CREDIT AGREEMENT
among
COVANCE INC.
as Borrower,
AND
CERTAIN SUBSIDIARIES OF COVANCE INC.
as Guarantors,
AND
THE LENDERS IDENTIFIED HEREIN,
AND
NATIONSBANK, N.A.,
as Administrative Agent
AND
WACHOVIA BANK OF GEORGIA, N.A.,
as Syndication Agent
DATED AS OF NOVEMBER 26, 1996
1
TABLE OF CONTENTS
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions............................................................ 1
1.2 Computation of Time Periods and Other Definitional Provisions......... 23
1.3 Accounting Terms...................................................... 23
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans....................................................... 23
2.2 Letter of Credit Subfacility.......................................... 26
2.3 Competitive Bid Loans Subfacility..................................... 31
2.4 Swing Line Loans Subfacility.......................................... 34
2.5 Currency Equivalents.................................................. 36
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest.............................................................. 36
3.2 Place and Manner of Payments.......................................... 36
3.3 Prepayments........................................................... 37
3.4 Fees.................................................................. 38
3.5 Payment in full at Maturity........................................... 39
3.6 Computations of Interest and Fees..................................... 39
3.7 Pro Rata Treatment.................................................... 40
3.8 Sharing of Payments................................................... 41
3.9 Capital Adequacy...................................................... 41
3.10 Inability To Determine Eurocurrency Rate or Make Loans in Foreign
Currency.............................................................. 42
3.11 Illegality............................................................ 42
3.12 Requirements of Law................................................... 43
3.13 Taxes................................................................. 44
3.14 Compensation.......................................................... 47
SECTION 4
GUARANTY
4.1 Guaranty of Payment................................................... 48
4.2 Obligations Unconditional............................................. 48
4.3 Modifications......................................................... 49
4.4 Waiver of Rights...................................................... 49
i
4.5 Reinstatement......................................................... 49
4.6 Remedies.............................................................. 50
4.7 Limitation of Guaranty................................................ 50
4.8 Rights of Contribution................................................ 51
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions.................................................... 52
5.2 Conditions to All Extensions of Credit................................ 55
SECTION 6
REPRESENTATIONS AND WARRANTIES
6.1 Financial Condition................................................... 56
6.2 No Material Change.................................................... 56
6.3 Organization and Good Standing........................................ 56
6.4 Due Authorization..................................................... 56
6.5 No Conflicts.......................................................... 56
6.6 Consents.............................................................. 57
6.7 Enforceable Obligations............................................... 57
6.8 No Default............................................................ 57
6.9 Liens................................................................. 57
6.10 Indebtedness.......................................................... 57
6.11 Litigation............................................................ 57
6.12 Taxes................................................................. 57
6.13 Compliance with Law................................................... 57
6.14 ERISA................................................................. 58
6.15 Subsidiaries.......................................................... 59
6.16 Use of Proceeds....................................................... 59
6.17 Government Regulation................................................. 59
6.18 Environmental Matters................................................. 60
6.19 Intellectual Property................................................. 61
6.20 Investments........................................................... 61
6.21 Disclosure............................................................ 61
SECTION 7
AFFIRMATIVE COVENANTS
7.1 Information Covenants................................................. 60
7.2 Financial Covenants................................................... 63
7.3 Preservation of Existence and Franchises.............................. 64
7.4 Books and Records..................................................... 64
7.5 Compliance with Law................................................... 64
7.6 Payment of Taxes and Other Indebtedness............................... 64
7.7 Insurance............................................................. 64
7.8 Maintenance of Property............................................... 64
7.9 Performance of Obligations............................................ 65
ii
7.10 Use of Proceeds....................................................... 65
7.11 Audits/Inspections.................................................... 65
7.12 Additional Credit Parties............................................. 65
7.13 Spin-Off.............................................................. 66
7.14 Uncertificated Securities............................................. 66
7.15 Additional Guarantors or Additional Pledges of Stock.
SECTION 8
NEGATIVE COVENANTS
8.1 Indebtedness.......................................................... 67
8.2 Liens................................................................. 68
8.3 Nature of Business.................................................... 68
8.4 Consolidation and Merger.............................................. 68
8.5 Sale or Lease of Assets............................................... 69
8.6 Sale Leasebacks....................................................... 69
8.7 Advances, Investments and Loans....................................... 69
8.8 Restricted Payments................................................... 69
8.9 Fiscal Year; Organizational Documents................................. 70
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default..................................................... 70
9.2 Acceleration; Remedies................................................ 72
9.3 Allocation of Payments After Event of Default......................... 73
SECTION 10
AGENCY PROVISIONS
10.1 Appointment........................................................... 74
10.2 Delegation of Duties.................................................. 75
10.3 Exculpatory Provisions................................................ 75
10.4 Reliance on Communications............................................ 75
10.5 Notice of Default..................................................... 76
10.6 Non-Reliance on Agents and Other Lenders.............................. 76
10.7 Indemnification....................................................... 77
10.8 Agents in Their Individual Capacity................................... 77
10.9 Successor Agent....................................................... 77
SECTION 11
MISCELLANEOUS
11.1 Notices............................................................... 78
11.2 Right of Set-Off...................................................... 78
11.3 Benefit of Agreement.................................................. 78
11.4 No Waiver; Remedies Cumulative........................................ 81
iii
11.5 Payment of Expenses; Indemnification.................................. 82
11.6 Amendments, Waivers and Consents...................................... 82
11.7 Counterparts.......................................................... 83
11.8 Headings.............................................................. 83
11.9 Defaulting Lender..................................................... 84
11.10 Survival.............................................................. 84
11.11 Governing Law......................................................... 84
11.12 Waiver of Jury Trial.................................................. 84
11.13 Time.................................................................. 84
11.14 Severability.......................................................... 84
11.15 Entirety.............................................................. 84
11.16 Binding Effect........................................................ 84
11.17 Confidentiality....................................................... 85
iv
SCHEDULES
Schedule 1.1(a) Revolving Commitment Percentages
Schedule 6.2 Material Adverse Effect
Schedule 6.10 Indebtedness
Schedule 6.11 Litigation
Schedule 6.14 ERISA
Schedule 6.15 Subsidiaries and Location of Facilities
Schedule 6.18 Environmental
Schedule 6.22 Location of Assets
Schedule 7.7 Insurance
Schedule 8.2 Liens
Schedule 8.7 Investments
Schedule 8.9 Organizational Documents
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Notice of Continuation/Conversion
Exhibit 2.1(g) Form of Revolving Loan Note
Exhibit 2.3(b) Form of Competitive Bid Loan Request
Exhibit 2.3(h) Form of Competitive Bid Loan Note
Exhibit 2.4(b) Form of Swing Line Loan Request
Exhibit 2.4(e) Form of Swing Line Loan Note
Exhibit 7.1(c) Form of Officer's Certificate
Exhibit 7.12 Form of Joinder Agreement
Exhibit 11.3 Form of Assignment Agreement
v
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (as amended, supplemented or otherwise modified
from time to time, this "Credit Agreement"), is entered into as of November 26,
1996 among COVANCE INC., a Delaware corporation ("Borrower"), certain of the
Borrower's Subsidiaries (individually a "Guarantor" and collectively the
"Guarantors"), the Lenders (as defined herein), NATIONSBANK, N.A., as
Administrative Agent for the Lenders and WACHOVIA BANK OF GEORGIA, N.A., as
Syndication Agent for the Lenders.
RECITALS
WHEREAS, Borrower wishes to enter into a $250 million revolving credit
facility; and
WHEREAS, the Lenders party hereto have agreed to make the requested
revolving credit facility available to the Borrower on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions. As used herein, the following terms shall have the
meanings herein specified unless the context otherwise requires. Defined terms
herein shall include in the singular number the plural and in the plural the
singular:
"Additional Credit Party" means, at any time, each Person that
shall have executed a Joinder Agreement after the Closing Date and
shall not have been released from its obligations as a Guarantor, as
provided in Sections 7.12 and 7.15.
"Adjusted Eurocurrency Rate" means the Eurocurrency Rate plus
the Applicable Percentage.
"Adjusted Leverage Ratio" means the ratio of (a) an amount
equal to Funded Debt minus the obligations of Corning Bio, Inc. under
the Corning Bio TROL to (b) EBITDA.
"Administrative Agent" means NationsBank, N.A. (or any
successor thereto) or any successor administrative agent appointed
pursuant to Section 10.9.
"Agents" mean the Administrative Agent and the Syndication
Agent and any successors and assigns in such capacity.
1
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling (including but not limited to
all directors and officers of such Person), controlled by or under
direct or indirect common control with such Person. A Person shall be
deemed to control a corporation if such Person possesses, directly or
indirectly, the power (i) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such corporation
or (ii) to direct or cause direction of the management and policies of
such corporation, whether through the ownership of voting securities,
by contract or otherwise.
"Agency Services Address" means NationsBank, N.A.,
NC1-001-15-04, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000,
Attn: Agency Services, or such other address as may be identified by
written notice from the Administrative Agent to the Borrower.
"Applicable Percentage" means, subject to the penultimate
paragraph of this definition, the appropriate applicable percentages
corresponding to the Adjusted Leverage Ratio in effect as of the most
recent Calculation Date as shown below:
------------------------------------------------------------------------------------------------------------
Long Term Applicable Applicable
Unsecured Percentage for Percentage Applicable
Pricing Adjusted Debt Rating of Eurocurrency for Letter of Percentage for
Level Leverage Ratio Borrower Loans Credit Fee Facility Fees
I Less than or = A- or better
1.0 to 1.0 from S&P .17% .17% .08%
A3 or better
from Moody's
II Less than or = BBB+ from S&P .20% .20% .10%
1.50 to 1.0 but Baa1 from Moody's
greater than
1.0 to 1.0
III Less than or = BBB from S&P .25% .25% .125%
2.0 to 1.0 Baa2 from Moody's
but greater than
1.50 to 1.0
IV Less than or = BBB- from S&P
2.50 to 1.0 but Baa3 from Moody's .30% .30% .15%
greater than
2.0 to 1.0
V Greater than Lower than BBB-
2.50 to 1.0 from S&P .45% .45% .20%
Lower than Baa3
from Moody's
------------------------------------------------------------------------------------------------------------
Subject to the penultimate paragraph of this definition, the
Applicable Percentage for Eurocurrency Loans, the Letter of Credit Fee
and the Facility Fees shall, in each case, be determined and adjusted
quarterly on the date (each a "Calculation Date") five Business Days
after the date by which the Borrower is required to provide the
officer's certificate in accordance with the provisions of Section
7.1(c); provided that the initial Applicable Percentage for
Eurocurrency Loans, the Letter of Credit Fee and the Facility Fees
shall be based on Pricing Level III (as shown above) and shall remain
at Pricing Level III until the first Calculation Date subsequent to
March 31, 1997 and, thereafter, the Pricing Level shall be determined
by the then current Adjusted Leverage Ratio; and provided further that
if the Borrower fails to provide the officer's certificate required by
Section 7.1(c) on or before any Calculation Date subsequent to March
31, 1997, the Applicable Percentage for Revolving Loans, the Letter of
Credit Fee and the Facility Fees shall be based on Pricing Level V from
2
such Calculation Date until such time that an appropriate officer's
certificate is provided whereupon the Pricing Level shall be determined
by the then current Adjusted Leverage Ratio. Each determination of the
Applicable Percentage shall be effective from one Calculation Date
until the next Calculation Date. Any adjustment in the Applicable
Percentage shall be applicable to all existing Loans and Letters of
Credit as well as any new Loans made or Letters of Credit issued.
At any time, the Borrower may, by written notice to the
Administrative Agent, tie the definition of Applicable Percentage to
the long term unsecured (non-credit enhanced) debt rating of the
Borrower as determined by S&P and Moody's (if the Borrower has received
a long term unsecured debt rating from both S&P and Moody's and
irrespective of the then Adjusted Leverage Ratio); provided that such
decision by the Borrower shall be permanent and irrevocable.
Thereafter, the Applicable Percentage shall mean, at any time, the
applicable percentage corresponding to the long term unsecured debt
ratings of the Borrower, as shown above, as such ratings may change
from time to time. If at any time the ratings provided by S&P and
Moody's are split between two different pricing levels, the appropriate
pricing level shall be based on the higher of the two ratings (i.e. the
lowest pricing based on the ratings); provided that if the split
between the two ratings is more than one pricing level then the
appropriate pricing level shall be one level above the lowest rating
(i.e. the pricing shall be based on the level that provides one level
cheaper pricing than the highest pricing based on the ratings). If
subsequent to the election by the Borrower to tie its pricing to its
long term unsecured (non-credit enhanced) debt rating, the Borrower's
long term unsecured debt is no longer rated by S&P and Moody's then
Pricing Level V shall apply.
The Borrower shall promptly deliver to the Administrative
Agent, at the address set forth on Schedule 11.1 and at the Agency
Services Address, information regarding any change in its unsecured
(non-credit enhanced) debt rating, as determined by S&P and Moody's
that would change the existing Pricing Level pursuant to the preceding
paragraph.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If for
any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is
unable after due inquiry to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Administrative Agent
to obtain sufficient quotations in accordance with the terms hereof,
the Base Rate shall be determined without regard to clause (a) of the
first sentence of this definition until the circumstances giving rise
to such inability no longer exist. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be effective
on the effective date of such change in the Prime Rate or the Federal
Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
3
"Benefits Plan" means each of (a) the Employee Stock Ownership
Plan of the Borrower, (b) the Trust Deed of the Covance Inc. Employee
Share Trust between the trustee and the Borrower, (c) the Stock
Purchase Savings Plan of the Borrower restated as of December 31, 1996,
(d) the Employee Stock Purchase Plan of the Borrower, (e) the Employee
Equity Participation Program of the Borrower and (f) any other "pension
plan" (as defined in Section 3(2) of ERISA) of the Borrower or trust
created thereunder.
"Borrower" means Covance Inc., a Delaware corporation,
together with any successors and permitted assigns.
"Borrower Obligations" means, without duplication, all of the
obligations of the Borrower to the Lenders (including the Issuing
Lender and NationsBank) and the Agents, whether for principal,
interest, fees, LOC Obligations, indemnifications or otherwise whenever
arising, under this Credit Agreement, the Notes, the Collateral
Documents or any of the other Credit Documents to which the Borrower is
a party, including, without limitation, any amounts that would have
accrued but for the automatic stay under the Bankruptcy Code.
"Business Day" means any day other than a Saturday, a Sunday,
a legal holiday or a day on which banking institutions are authorized
or required by law or other governmental action to close in Charlotte,
North Carolina or New York, New York; provided that in the case of
Eurocurrency Loans, such day is also a day on which dealings between
banks are carried on in U.S. dollar deposits in the London interbank
market.
"Calculation Date" has the meaning set forth in the definition
of Applicable Percentage.
"Capital Expenditures" means all expenditures of the Credit
Parties and their Subsidiaries which, in accordance with GAAP, would be
classified as capital expenditures, including, without limitation,
Capital Leases.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Cash Equivalents" means (a) 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 twelve months from the date of
acquisition, (b) U.S. dollar denominated time and demand deposits and
certificates of deposit of (i) any Lender, (ii) any domestic commercial
bank having capital and surplus in excess of $500,000,000 or (iii) any
bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Xxxxx'x is at least P-1 or the
equivalent thereof (any such bank being an "Approved Bank"), in each
case with maturities of not more than 270 days from the date of
acquisition, (c) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any
variable rate notes issued by, or
4
guaranteed by, any domestic corporation rated A-1 (or the equivalent
thereof) or better by S&P or P-1 (or the equivalent thereof) or better
by Moody's and maturing within six months of the date of acquisition,
(d) repurchase agreements with a bank or trust company (including any
of the Lenders) or securities dealer having capital and surplus in
excess of $500,000,000 for direct obligations issued by or fully
guaranteed by the United States of America in which the Borrower shall
have a perfected first priority security interest (subject to no other
Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations, (e)
marketable direct obligations issued by any state of the United States
of America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, rated A-1 (or the
equivalent thereof) or better from S&P or rated P-1 (or the equivalent
thereof) or better from Moody's, (f) Eurocurrency time deposits having
a maturity of less than one year purchased from any Lender directly
(whether or not such deposit is with such Lender or any other Lender
hereunder) and (g) Investments, classified in accordance with GAAP as
current assets, in money market investment programs registered under
the Investment Company Act of 1940, as amended, which are administered
by financial institutions having capital of at least $500,000,000 and
the portfolios of which are limited to Investments of the character
described in the foregoing subdivisions (a) through (g).
"Change of Control" means, at any time subsequent to the
occurrence of the Spin-Off, the occurrence of the following event: any
"person" or "group" (within the meaning of Section 13(d) or 14(d) of
the Exchange Act) has become, directly or indirectly, the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a Person shall be deemed to have "beneficial ownership" of
all shares that any such Person has the right to acquire, whether such
right is exercisable immediately or only after the passage of time), by
way of merger, consolidation or otherwise, of 30% or more of the voting
power of the Voting Stock of the Borrower on a fully-diluted basis,
after giving effect to the conversion and exercise of all outstanding
warrants, options and other securities of the Borrower (whether or not
such securities are then currently convertible or exercisable);
provided that none of the Benefit Plans shall be deemed to be a
"beneficial owner" under this definition.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986 and the rules
and regulations promulgated thereunder, as amended, modified, succeeded
or replaced from time to time.
"Collateral Assignment of Notes" means those certain
Collateral Assignment of Notes, executed and delivered by the
applicable Credit Parties in favor of the Administrative Agent, for the
benefit of the Lenders, collaterally assigning promissory notes issued
by any Non-Material Domestic Subsidiary to a Credit Party.
"Collateral Documents" means the Pledge Agreements and the
Collateral Assignments of Notes.
5
"Commitments" means the commitment of each Lender with respect
to the Revolving Committed Amount and the commitment of NationsBank
with respect to the Swing Line Committed Amount.
"Competitive Bid" means an offer by a Lender to make a
Competitive Bid Loan pursuant to the terms of Section 2.3.
"Competitive Bid Loan" means a loan made by a Lender in its
discretion pursuant to the provisions of Section 2.3.
"Competitive Bid Loan Notes" means the promissory notes of the
Borrower in favor of each of the Lenders evidencing the Competitive Bid
Loans provided pursuant to Section 2.3, individually or collectively,
as appropriate, as such promissory notes may be amended, modified,
supplemented, extended, renewed or replaced from time to time and as
evidenced in the form of Exhibit 2.3(h).
"Competitive Bid Loan Request" means a request by the Borrower
for Competitive Bids substantially in the form of Exhibit 2.3(b).
"Competitive Bid Rate" means, as to any Competitive Bid made
by a Lender in accordance with the provisions of Section 2.3, (a) in
the case of a Eurocurrency Competitive Loan, the Eurocurrency Rate and
(b) in the case of a Fixed Rate Competitive Loan the fixed rate of
interest offered by the Lender making the Competitive Bid.
"Corning Bio TROL" means (a) that certain Lease Agreement (Tax
Retention Operating Lease - Personal Property), dated as of June 30,
1995 between NationsBanc Leasing Corporation of North Carolina and
Corning Bio, Inc. (f/k/a Corning Biopro, Inc.), (b) that certain Lease
Agreement (Tax Retention Operating Lease - Real Property) dated as of
June 30, 1995 between NationsBanc Leasing Corporation and Corning Bio,
Inc. (f/k/a Corning Biopro, Inc.) and all Operative Agreements (as
defined in the above agreements) entered into in connection therewith,
as such agreements may be amended, modified or supplemented from time
to time and (c) without duplication, all agreements, instruments and
documents pursuant to which any one or more of the Borrower and its
Subsidiaries guaranty or otherwise support any obligations under any
Corning Bio TROL described in (a) or (b) above.
"Credit Documents" means this Credit Agreement, the Notes, any
Joinder Agreement, the Fee Letter, the Collateral Documents and all
other related agreements and documents issued or delivered hereunder by
(i) a Guarantor to guarantee the Borrower Obligations or to secure such
guarantee or (ii) the Borrower or one of its Subsidiaries (other than a
Guarantor) to secure the Borrower Obligations.
"Credit Parties" means the Borrower and the Guarantors and
"Credit Party" means any one of them.
6
"Credit Party Obligations" means, without duplication, all of
the obligations of the Credit Parties to the Lenders (including the
Issuing Lender and NationsBank) and the Agents, whether for principal,
interest, fees, LOC Obligations, indemnifications or otherwise whenever
arising, under this Credit Agreement, the Notes, the Collateral
Documents or any of the other Credit Documents to which the Borrower or
any other Credit Party is a party, including, without limitation, any
amounts that would have accrued but for the automatic stay under the
Bankruptcy Code.
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that: (a)
has failed to make a Loan or purchase a Participation Interest required
pursuant to the terms of this Credit Agreement (but only for so long as
such Loan is not made or such Participation Interest is not purchased),
(b) has failed to pay to the Agents or any Lender an amount owed by
such Lender pursuant to the terms of this Credit Agreement (but only
for so long as such amount has not been repaid) or (c) has been deemed
insolvent or has become subject to a bankruptcy or insolvency
proceeding or to a receiver, trustee or similar official.
"Disclosure Documents" means, collectively, as of any date,
the Information Statement, the Offering Memorandum, the Credit
Documents, the SEC Documents and other certificates or instruments
provided to the Agents and the Lenders in connection with this Credit
Agreement.
"Dollars" and "$" means dollars in lawful currency of the
United States of America.
"Domestic Subsidiary" means each direct and indirect
Subsidiary of the Borrower that (a) is domiciled, incorporated or
organized under the laws of any State of the United States or the
District of Columbia and (b) has at least 20% of its sales, earnings or
assets (determined on a consolidated basis) located or derived from its
operations in the United States of America.
"EBIT" means, for any period, with respect to the Borrower and
its Subsidiaries on a consolidated basis, the sum of (a) Net Income for
such period (excluding the effect of any extraordinary or other
non-recurring gains or losses outside of the ordinary course of
business), provided that for any fiscal quarter ending prior to
December 31, 1997, Net Income shall not include the one time
restructuring charge incurred in connection with the Spin-Off as long
as such restructuring charge does not exceed $75,000,000 plus (b) an
amount which, in the determination of Net Income for such period, has
been deducted for (i) Interest Expense for such period and (ii) total
Federal, state, foreign or other income taxes for such period, all as
determined in accordance with GAAP.
"EBITDA" means, for any period, with respect to the Borrower
and its Subsidiaries on a consolidated basis, an amount equal to (a)
EBIT plus (b) an amount which, in the determination of Net Income for
such period, has been deducted for all depreciation and amortization
for such period, all as determined in accordance with GAAP.
7
"Effective Date" means the date, as specified by the
Administrative Agent in writing, on which the conditions set forth in
Section 5.1 shall have been fulfilled (or waived in the sole discretion
of the Lenders).
"Eligible Assignee" means (a) a Lender; (b) an Affiliate or
Subsidiary of a Lender; (c) a commercial bank organized under the laws
of the United States, or any State thereof, and having a combined
capital and surplus of at least $500,000,000; (d) a savings and loan
association or savings bank organized under the laws of the United
States, or any State thereof, and having a combined capital and surplus
of at least $500,000,000; (e) a commercial bank organized under the
laws of any other country that is a member of the OECD or has concluded
special lending arrangements with the International Monetary Fund
associated with its general arrangements to borrow or a political
subdivision of any such country, and having a combined capital and
surplus of at least $500,000,000, so long as such bank is acting
through a branch or agency located in the United States; (f) a finance
company, insurance company or other financial institution or fund
(whether a corporation, partnership, trust or other entity) that is
engaged in making, purchasing or otherwise investing in commercial
loans in the ordinary course of its business and having a combined
capital and surplus of at least $250,000,000; and (g) any other Person
approved by the Agents and the Borrower.
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit,
injunction, judgment, order, consent decree, penalty, fine, lien,
proceeding, or written claim whether administrative, judicial, or
private in nature arising (a) pursuant to, or in connection with, an
actual or alleged violation of, any Environmental Law, (b) in
connection with any Hazardous Material, (c) from any assessment,
abatement, removal, remedial, corrective, or other response action in
connection with an Environmental Law or other order of a Governmental
Authority or (d) from any actual or alleged damage, injury, threat, or
harm to health, safety, natural resources, or the environment.
"Environmental Laws" means any current or future legal
requirement of any Governmental Authority pertaining to (a) the
protection of health, safety, and the indoor or outdoor environment,
(b) the conservation, management, or use of natural resources and
wildlife, (c) the protection or use of surface water and groundwater or
(d) the management, manufacture, possession, presence, use, generation,
transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure
to, any hazardous or toxic substance or material or (e) pollution
(including any release to land surface water and groundwater) and
includes, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid
Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and Hazardous and Solid Waste Amendment of 1984,
42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by
the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of
1966, as amended, 42 USC 7401 et seq., Toxic Substances Control Act of
1976, 15 USC 2601 et seq., Hazardous Materials Transportation Act, 49
USC App.
8
1801 et seq., Occupational Safety and Health Act of 1970, as amended,
29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et seq.,
Emergency Planning and Community Right- to-Know Act of 1986, 42 USC
11001 et seq., National Environmental Policy Act of 1969, 42 USC 4321
et seq., Safe Drinking Water Act of 1974, as amended, 42 USC 300(f) et
seq., any analogous implementing or successor law, and any amendment,
rule, regulation, order, or directive issued thereunder.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
from time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means (except as otherwise set forth herein)
any Credit Party, or any of its Subsidiaries, which, together with any
Credit Party, is treated as a single employer under Sections 414(b),
(c), (m), or (o) of the Code.
"Eurocurrency Competitive Loan" means a Competitive Bid Loan
bearing interest at a rate determined by reference to the Eurocurrency
Rate.
"Eurocurrency Loan" means a Loan, other than a Eurocurrency
Competitive Loan, bearing interest based at a rate determined by
reference to the Eurocurrency Rate.
"Eurocurrency Rate" means, for the Interest Period for each
Eurocurrency Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
determined pursuant to the following formula:
Eurocurrency Rate = London Interbank Offered Rate
1 - Eurocurrency Reserve Percentage
"Eurocurrency Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as such regulation may be amended
from time to time or any successor regulation, as the maximum reserve
requirement (including, without limitation, any basic, supplemental,
emergency, special, or marginal reserves, if any) applicable with
respect to Eurocurrency liabilities as that term is defined in
Regulation D (or against any other category of liabilities that
includes deposits by reference to which the interest rate of
Eurocurrency Loans is determined), whether or not Lender has any
Eurocurrency liabilities subject to such reserve requirement at that
time. The Eurocurrency Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurocurrency Reserve
Percentage.
"Event of Default" means any of the events or circumstances
described in Section 9.1.
9
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as
amended, modified, succeeded or replaced from time to time.
"Extension of Credit" means, as to any Lender, the making of a
Loan by such Lender (or a participation therein by a Lender) or the
issuance of, or participation in, a Letter of Credit by such Lender.
"Facility Fees" has the meaning set forth in Section 3.4.
"Federal Funds Rate" means for any day the rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided
that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day and (b) if no such rate is so published on such next
preceding Business Day, the Federal Funds Rate for such day shall be
the average rate quoted to the Administrative Agent on such day on such
transactions as determined by the Administrative Agent.
"Fee Letter" means that certain letter agreement, dated as of
September 30, 1996, between the Agents and the Borrower, as amended,
modified, supplemented or replaced from time to time.
"First Tier Foreign Subsidiary" means, at any date of
determination, each Foreign Subsidiary in which any one or more of the
Borrower and its Domestic Subsidiaries owns more than 50%, in the
aggregate, of the Voting Stock of such Foreign Subsidiary.
"Fixed Charge Coverage Ratio" means the ratio of (a) an amount
equal to the sum of EBIT plus Rent Expense to (b) an amount equal to
the sum of Interest Expense plus Rent Expense.
"Fixed Rate" has the meaning set forth in Section 2.3(c).
"Fixed Rate Competitive Loan" means a Competitive Bid Loan
designated as a Fixed Rate Competitive Loan in accordance with Section
2.3.
"Foreign Currency" means British Pounds Sterling, Swiss
Francs, German Marks and Japanese Yen or such other currency as agreed
to between the Borrower and all the Lenders. Each Foreign Currency must
be one (a) that is freely transferable and convertible into Dollars and
(b) in which deposits are generally available to the Lenders in the
London interbank market.
"Foreign Subsidiaries" means all Subsidiaries of the Borrower
that are not Domestic Subsidiaries.
10
"Funded Debt" means, without duplication, the sum of (a) all
Indebtedness of the Credit Parties and their Subsidiaries for borrowed
money, (b) all purchase money Indebtedness of the Credit Parties and
their Subsidiaries, (c) the principal portion of all obligations of the
Credit Parties and their Subsidiaries under Capital Leases, (d) all
obligations, contingent or otherwise, relative to the face amount of
all letters of credit (other than letters of credit supporting trade
payables in the ordinary course of business), whether or not drawn, and
banker's acceptances issued for the account of such Person (it being
understood that, to the extent an undrawn letter of credit supports
another obligation consisting of Indebtedness, in calculating
aggregated Indebtedness only such other obligation shall be included),
(e) all Guaranty Obligations of the Credit Parties and their
Subsidiaries with respect to Funded Debt of another Person, (f) all
Funded Debt of another entity secured by a Lien on any property of the
Credit Parties and their Subsidiaries whether or not such Funded Debt
has been assumed by a Credit Party or any of its Subsidiaries, (g) all
Funded Debt of any partnership or unincorporated joint venture to the
extent a Credit Party or one of its Subsidiaries is legally obligated,
net of any assets of such partnership or joint venture and (h) the
principal balance outstanding under any synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet
financing product where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an operating lease
in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any Federal, state, local,
provincial or foreign court or governmental agency, authority,
instrumentality or regulatory body.
"Guarantor" means at any time, (a) each of the parties to this
Credit Agreement listed as "Guarantors" on the signature pages hereof
which are the only Material Domestic Subsidiaries as of the Closing
Date and (b) each other Person that is an Additional Credit Party, in
each case, together with their successors and assigns, but excluding
any such Person that shall have been released from its guaranty
obligations pursuant to Section 7.12 or 7.15.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations (other than endorsements in the
ordinary course of business of negotiable instru ments for deposit or
collection) guaranteeing any Indebtedness of any other Person in any
manner, whether direct or indirect, and including without limitation
any obligation, whether or not contingent, (a) to purchase any such
Indebtedness or other obligation or any property constituting security
therefor, (b) to advance or provide funds or other support for the
payment or purchase of such Indebtedness or to maintain working capital
or solvency of such other Person (including, without limitation,
maintenance agreements, comfort letters, take or pay arrangements, put
agreements or similar agreements or arrangements but excluding any
comfort letters, letters of awareness or similar agreements or
arrangements to the extent such Person is not legally obligated
thereunder) for the benefit of the holder of Indebtedness of such other
Person, (c) to lease or purchase property, securities or services
primarily for the purpose of assuring the owner of such Indebtedness or
(d) to otherwise assure or hold harmless the owner of such Indebtedness
or obligation against loss in respect thereof. The
11
amount of any Guaranty Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount equal to the
outstanding principal amount (or maximum principal amount, if larger)
of the Indebtedness in respect of which such Guaranty Obligation is
made.
"Hazardous Materials" means any substance, material or waste
defined or regulated in or under any applicable Environmental Laws.
"Indebtedness" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (c)
all obligations of such Person under conditional sale or other title
retention agreements relating to property purchased by such Person to
the extent of the value of such property (other than customary
reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (d) all obligations,
other than intercompany items, of such Person issued or assumed as the
deferred purchase price of property or services purchased by such
Person which would appear as liabilities on a balance sheet of such
Person, (e) all Indebtedness of others secured by any Lien on property
or assets owned by such Person, (f) all Guaranty Obligations of such
Person, (g) the principal portion of all obligations of such Person
under (i) Capital Leases and (ii) any synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet
financing product of such Person where such transaction is considered
borrowed money indebtedness for tax purposes but is classified as an
operating lease in accordance with GAAP, (h) the maximum amount of all
performance and standby letters of credit issued or bankers'
acceptances facilities created for the account of such Person and,
without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (i) the payment obligations required by such Person to
be made, prior to the Revolving Loan Maturity Date, for mandatory
redemption or mandatory sinking fund payments under any preferred stock
issued by such Person and (j) the aggregate amount of uncollected
accounts receivable of such Person subject at such time to a sale of
receivables (or similar transaction) regardless of whether such
transaction is effected without recourse to such Person or in a manner
that would not be reflected on the balance sheet of such Person in
accordance with GAAP. The Indebtedness of any Person shall include the
Indebtedness of any partnership or unincorporated joint venture in
which such Person is legally obligated or has a reasonable expectation
of being liable with respect thereto.
"Information Statement" means the information memorandum dated
September 20, 1996 delivered in connection with the distribution of the
common stock of Corning Clinical Laboratories Inc. and Corning
Pharmaceutical Services Inc., as such memorandum may be amended,
supplemented or otherwise modified from time to time on or before the
Effective Date.
"Interest Expense" means, for any period, with respect to the
Credit Parties and their Subsidiaries on a consolidated basis, all
interest expense (net of interest income), including the interest
component under Capital Leases, as determined in accordance with GAAP.
12
"Interest Payment Date" means (a) as to Base Rate Loans, the
first Business Day of each fiscal quarter of the Borrower, the date on
which a Base Rate Loan is converted to a Eurocurrency Loan and the
Revolving Loan Maturity Date, (b) as to Eurocurrency Loans, the last
day of each applicable Interest Period, the Revolving Loan Maturity
Date and, where the applicable Interest Period for a Eurocurrency Loan
is greater than three months, the date three months from the beginning
of the Interest Period and each three months thereafter and (c) as to
Competitive Bid Loans and Quoted Rate Swing Line Loans, the last day of
the Interest Period applicable to such Loan and the Revolving Loan
Maturity Date; provided that if the Interest Period for a Competitive
Bid Loan or a Quoted Rate Swing Line Loan is greater than 90 days then
also on the first Business Day of each fiscal quarter of the Borrower.
"Interest Period" means, (a) as to Eurocurrency Loans, a
period of one, two, three or six months' duration, as the Borrower may
elect, commencing, in each case, on the date of the borrowing
(including continuations and conversions thereof) and (b) with respect
to Competitive Bid Loans and Quoted Rate Swing Line Loans, a period
beginning on the date of such Loan and ending on the date specified in
the applicable Competitive Bid Loan Request or Swing Line Loan Request;
provided, however, (i) if any Interest Period would end on a day which
is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day (except, with respect to Eurocurrency
Loans, that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(ii) no Interest Period shall extend beyond the Revolving Loan Maturity
Date, (ii) with respect to Eurocurrency Loans, where an Interest Period
begins on a day for which there is no numerically corresponding day in
the calendar month in which the Interest Period is to end, such
Interest Period shall end on the last Business Day of such calendar
month and (iv) no Interest Period for a Competitive Bid Loan shall
exceed 180 days.
"Investment" in any Person means (a) the acquisition (whether
for cash, property, services, assumption of Indebtedness, securities or
otherwise) of assets, shares of capital stock, bonds, notes,
debentures, partnership, joint ventures or other ownership interests or
other securities of such other Person or (b) any deposit with, or
advance, loan or other extension of credit to, such Person (other than
deposits made in connection with the purchase of equipment or other
assets in the ordinary course of business) or (c) any other capital
contribution to or investment in such Person, including, without
limitation, any Guaranty Obligation (including any support for a Letter
of Credit issued on behalf of such Person) incurred for the benefit of
such Person.
"Issuing Lender" means NationsBank, N.A. or any successor
thereto.
"Issuing Lender Fees" has the meaning set forth in Section
3.4(b).
"Joinder Agreement" means a Joinder Agreement substantially in
the form of Exhibit 7.12, as such Joinder Agreement may be amended,
modified or supplemented from time to time.
13
"Lender" means any of the Persons identified as a "Lender" on
the signature pages hereto, and any Person which may become a Lender by
way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Letter of Credit" means a Letter of Credit issued for the
account of a Credit Party by the Issuing Lender pursuant to Section
2.2, as such Letter of Credit may be amended, modified, extended,
renewed or replaced.
"Letter of Credit Fee" shall have the meaning assigned to such
term in Section 3.4(b).
"Leverage Ratio" means the ratio of (a) Funded Debt to (b)
EBITDA.
"Lien" means any mortgage, pledge, hypothecation, security
interest, encumbrance or lien (statutory or otherwise) including,
without limitation, the rights of a vendor or lessor under any
conditional sale or title retention agreement or any lease
substantially equivalent thereto.
"Loan" or "Loans" means the Revolving Loans, the Swing Line
Loans and the Competitive Bid Loans, individually or collectively, as
appropriate.
"LOC Committed Amount" means Twenty Five Million Dollars
($25,000,000).
"LOC Documents" means, with respect to any Letter of Credit,
such Letter of Credit, any amendments thereto, any documents delivered
in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (a) the rights and obligations of the parties concerned
or at risk or (b) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (a) the
maximum amount which is, or at any time thereafter may become,
available to be drawn under Letters of Credit then outstanding,
assuming compliance with all requirements for drawings referred to in
such Letters of Credit plus (b) the aggregate amount of all drawings
under Letters of Credit honored by an Issuing Lender but not
theretofore reimbursed.
"LOC Participants" means the Lenders.
"London Interbank Offered Rate" means, with respect to any
Eurocurrency Loan for the Interest Period applicable thereto, the rate
of interest per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in Dollars (or the
applicable Foreign Currency) at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period; provided, however, if more
than one rate is specified on Telerate Page 3750, the applicable rate
shall be the arithmetic mean of all such rates. If, for any reason,
such rate is not available, the term "London Interbank Offered Rate"
shall mean, with respect to any Eurocurrency Loan for the
14
Interest Period applicable thereto, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing
on Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 A.M. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one
rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates.
"Mandatory Borrowing" has the meaning set forth in Section
2.2(e).
"Material Adverse Effect" means a material adverse effect
(after giving effect to any insurance proceeds or indemnification
payments under existing insurance policies or agreements as long as the
obligor under such policies or agreements is financially solvent and
has acknowledged coverage) on (a) the results of operations or
financial condition of the Borrower and its Subsidiaries taken as a
whole, (b) the ability of a Credit Party to perform its respective
obligations under this Credit Agreement or any of the other Credit
Documents, or (c) the validity or enforceability of this Credit
Agreement, any of the other Credit Documents, or the rights and
remedies of the Lenders hereunder or thereunder taken as a whole;
provided, however, that none of the following shall constitute a
Material Adverse Effect: (i) the execution, delivery and performance of
the Credit Documents, (ii) the Spin- Off and consummation of any one or
more of the contemplated transactions related to the Spin-Off, as
disclosed in the Information Statement, and (iii) the execution and
delivery, in and of themselves, of the Transaction Agreement, the Tax
Indemnity Agreements or the Tax Sharing Agreement.
"Material Domestic Subsidiary" means any Domestic Subsidiary
of the Borrower that is also a Material Subsidiary.
"Material First Tier Foreign Subsidiary" mean a First Tier
Foreign Subsidiary that is also a Material Subsidiary.
"Material Subsidiary" means, as of any date of determination,
any Domestic Subsidiary or any Foreign Subsidiary that, together with
its Subsidiaries on a consolidated basis, owns assets (excluding assets
that pursuant to GAAP principles of consolidation would be eliminated
from the consolidated balance sheet of the Borrower as of such date)
equal to at least five percent (5%) of the total assets of the Borrower
and its Subsidiaries on a consolidated basis; provided that neither
Covance Health Economics Outcome Services Inc. (f/k/a Corning HTA,
Inc.) nor any of its Subsidiaries shall not be deemed to be a Material
Subsidiary.
"Moody's" means Xxxxx'x Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Multiemployer Plan" means a Plan covered by Title IV of ERISA
which is a multiemployer plan as defined in Section 3(37) or 4001(a)(3)
of ERISA.
15
"Multiple Employer Plan" means a Plan covered by Title IV of
ERISA, other than a Multiemployer Plan, which any Credit Party or any
of its Subsidiaries or any ERISA Affiliate and at least one employer
other than a Credit Party or any of its Subsidiaries or any ERISA
Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. (or any successor
thereto).
"Net Income" means, for any period, the net income after taxes
for such period of the Credit Parties and their Subsidiaries on a
consolidated basis, as determined in accordance with GAAP.
"Non-Excluded Taxes" has the meaning set forth in Section
3.13.
"Non-Material Domestic Subsidiaries" means all Domestic
Subsidiaries that are not Material Domestic Subsidiaries.
"Note" or "Notes" means the Revolving Loan Notes, the
Competitive Bid Loan Notes and the Swing Line Loan Notes, individually
or collectively, as appropriate.
"Notice of Borrowing" means a request by the Borrower for a
Revolving Loan, substantially in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the
Borrower to continue an existing Eurocurrency Loan to a new Interest
Period or to convert a Eurocurrency Loan to a Base Rate Loan or a Base
Rate Loan to a Eurocurrency Loan, substantially in the form of Exhibit
2.1(e).
"Offering Memorandum" means the offering memorandum dated
October, 1996 delivered by the Administrative Agents to the Lenders, as
amended, supplemented or otherwise modified by the Information
Statement, and as it may be further amended, supplemented or otherwise
modified from time to time on or prior to the Effective Date.
"Operating Lease" means, as to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as an
operating lease.
"Participation Interest" means the Extension of Credit by a
Lender by way of a purchase of a participation in Letters of Credit or
LOC Obligations as provided in Section 2.2 or in any Loans as provided
in Section 3.8.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereto.
"Permitted Acquisition" means the acquisition of (a) all of
the capital stock of another Person or (b) all or substantially all of
the assets of another Person; provided that (i) to the extent any such
acquisition is paid for in cash or through deferred payments or through
the
16
assumption of debt, any such acquisition shall not exceed $100,000,000
and (ii) after giving effect to any such acquisition (A) the Credit
Parties and their Subsidiaries are in compliance with all the financial
covenants set forth in Section 7.2 and the use of proceeds covenant in
Section 7.10 and (B) no Default or Event of Default exists and is
continuing.
"Permitted Investments" means Investments which are (a) cash
or Cash Equivalents, (b) accounts receivable created, acquired or made
in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms, (c) inventory, raw materials and
general intangibles (to the extent such general intangible is not a
Capital Expenditure) acquired in the ordinary course of business, (d)
Investments in the Borrower or a Subsidiary of the Borrower, (e) loans
to directors, officers or employees in the ordinary course of business
for reasonable business expenses, not to exceed in the aggregate
$5,000,000 at any one time, (f) the investments existing on the date
hereof, as set forth on Schedule 8.7, (g) Investments in Capital
Expenditures, (h) Investments in Permitted Acquisitions, (i)
Investments in joint ventures (other than joint ventures which are
Subsidiaries of the Borrower), in the aggregate, not to exceed
$10,000,000 at any one time, (j) as long as no Default or Event of
Default exists and is continuing. Investments, if any, pursuant to (A)
the Benefits Plans of the type referred to in subsection (a) and (b) of
the definition of "Benefit Plans", (B) the Benefits Plans of the type
referred to in subsections (c), (d), (e) and (f) of the definition of
"Benefits Plans" in an aggregate amount not to exceed $50,000,000
during the term of this Credit Agreement and (C) the Rights Plan in an
aggregate amount not to exceed $2,000,000, and (k) received as
consideration in connection with an asset sale permitted pursuant to
Section 8.5.
"Permitted Liens" means (a) Liens securing Credit Party
Obligations, if any (b) Liens for taxes not yet due or Liens for taxes
being contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is
not yet subject to foreclosure, sale or loss on account thereof), (c)
Liens in respect of property imposed by law arising in the ordinary
course of business such as materialmen's, mechanics', warehousemen's,
carrier's, landlords' and other nonconsensual statutory Liens which are
not past due more than 30 days or which are being contested in good
faith by appropriate proceedings for which adequate reserves determined
in accordance with GAAP have been established (and as to which the
property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof), (d) pledges or deposits made in the
ordinary course of business to secure payment of worker's compensation
insurance, unemployment insurance, pensions or social security
programs, (e) Liens arising from good faith deposits in connection with
or to secure performance of tenders, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations incurred in the ordinary course of business (other than
obligations in respect of the payment of borrowed money), (f) Liens
arising from good faith deposits in connection with or to secure
performance of statutory obligations and surety and appeal bonds, (g)
easements, rights-of-way, restrictions (including zoning restrictions),
matters of plat, minor defects or irregularities in title and other
similar charges or encumbrances not, in any material respect, impairing
the use of the encumbered property for its intended purposes, (h)
judgment Liens that would not otherwise constitute an Event of Default
and any other judgment Lien unless
17
not discharged within sixty days of entry, pending appeal, or within
sixty days after expiration of stay, (i) Liens in connection with
Indebtedness allowed under Section 8.1(d), (j) Liens arising by virtue
of any statutory or common law provision relating to banker's liens,
rights of setoff or similar rights as to deposit accounts or other
funds maintained with a creditor depository institution, (k) liens on
leased equipment or under conditional sale or other title retention
agreements, (l) leases or subleases granted to others not interfering
in any material respect with the business of the Borrower or any of its
Subsidiaries, (m) liens in favor of customs and revenue authorities as
a matter of law to secure payment of customs duties, (n) liens securing
surety bonds in an aggregate amount not to exceed $5,000,000, (o) liens
securing appeal bonds covering assets less than or equal to
$20,000,000, (p) Liens existing on the date hereof and identified on
Schedule 8.2; provided that no such Lien shall extend to any property
other than the property subject thereto on the Closing Date, (q) Liens
securing any Corning Bio TROL and (r) Liens on the Voting Stock and
other capital stock of any First Tier Foreign Subsidiary to the extent
not pledged to the Administrative Agent pursuant to Section 7.12 and
7.15.
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated), or any Governmental
Authority.
"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which any
Credit Party or any of its Subsidiaries or any ERISA Affiliate is (or,
if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an "employer" within the meaning of Section 3(5)
of ERISA.
"Pledge Agreements" means those certain Pledge Agreements
executed and delivered by the applicable Credit Parties in favor of the
Administrative Agent, for the benefit of the Lenders, pledging 65% of
the capital stock of the Material First Tier Foreign Subsidiaries and
such other First Tier Foreign Subsidiaries as required by Section 7.15,
as they may be amended, modified, extended, renewed or replaced from
time to time.
"Prime Rate" means the per annum rate of interest established
from time to time by the Administrative Agent at its principal office
in Charlotte, North Carolina (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the
Lenders) as its Prime Rate. Any change in the interest rate resulting
from a change in the Prime Rate shall become effective as of 12:01 a.m.
of the Business Day on which each change in the Prime Rate is announced
by the Administrative Agent. The Prime Rate is a reference rate used by
the Administrative Agent in determining interest rates on certain loans
and is not intended to be the lowest rate of interest charged on any
extension of credit to any debtor.
"Quoted Rate" has the meaning set forth in Section 2.4.
"Quoted Rate Swing Line Loan" means a Swing Line Loan made
with a Quoted Rate.
18
"Real Properties" has the meaning specified in Section 6.18.
"Regulation D, G, U, or X" means Regulation D, G, U or X,
respectively, of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion
thereof.
"Rent Expense" means, for any period, with respect to the
Credit Parties and their Subsidiaries on a consolidated basis, all rent
payable under Operating Leases, as determined in accordance with GAAP.
"Reportable Event" means a "reportable event" as defined in
Section 4043 of ERISA with respect to which the notice requirements to
the PBGC have not been waived.
"Required Lenders" means Lenders whose aggregate Credit
Exposure (as hereinafter defined) constitutes more than 50% of the
Credit Exposure of all Lenders at such time; provided, however, that if
any Lender shall be a Defaulting Lender at such time then there shall
be excluded from the determination of Required Lenders the aggregate
principal amount of Credit Exposure of such Lender at such time. For
purposes of the preceding sentence, the term "Credit Exposure" as
applied to each Lender shall mean (a) at any time prior to the
termination of the Commitments, the Revolving Loan Commitment
Percentage of such Lender multiplied by the Revolving Committed Amount
and (b) at any time after the termination of the Commitments, the sum
of (i) the principal balance of the outstanding Loans of such Lender
plus (ii) such Lender's Participation Interests in the face amount of
the outstanding Letters of Credit.
"Requirement of Law" means, as to any Person (who is not a
Lender), the articles or certificate of incorporation and by-laws or
other organizational or governing documents of such Person and as to
any Person, any law, treaty, rule or regulation or final,
non-appealable determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such
Person or to which any of its material property is subject.
"Revolving Loan Commitment Percentage" means, for each Lender,
the percentage identified as its Revolving Commitment Percentage on
Schedule 1.1(a), as such percentage may be modified in connection with
any assignment made in accordance with the provisions of Section 11.3.
"Revolving Committed Amount" means TWO HUNDRED FIFTY MILLION
DOLLARS ($250,000,000) or such lesser amount as the Revolving Committed
Amount may be reduced pursuant to Section 2.1(d).
"Revolving Loan Maturity Date" means November 25, 2001 or such
earlier date if accelerated in accordance with Section 9.2.
"Revolving Loans" means the Revolving Loans made to the
Borrower pursuant to Section 2.1.
19
"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrower in favor of each of the Lenders evidencing the
Revolving Loans provided pursuant to Section 2.1, individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time
and as evidenced in the form of Exhibit 2.1(g).
"Rights Plan" means that certain Rights Agreement to be
entered into between the Borrower and Xxxxxx Trust and Savings Bank.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"SEC Documents" means the Borrower's Registration Statement on
Form 10, File No. 1-12213, filed with the Securities and Exchange
Commission on September 23, 1996, as further amended by Amendment No.
1, filed November 5, 1996, and Amendment No. 2, filed November 19, 1996
and as it may be further amended and supplemented on or before the
Effective Date.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Credit Party as of a
particular date, that on such date (a) such Credit Party is able to pay
its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (b) such
Credit Party does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Credit Party's ability to pay as
such debts and liabilities mature in their ordinary course, (c) such
Credit Party is not engaged in a business or a transaction, and is not
about to engage in a business or a transaction, for which such Credit
Party's assets would constitute unreasonably small capital after giving
due consideration to the prevailing practice in the industry in which
such Credit Party is engaged or is to engage, (d) the fair value of the
assets of such Credit Party is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of
such Credit Party and (e) the present fair saleable value of the assets
of such Credit Party is not less than the amount that will be required
to pay the probable liability of such Credit Party on its debts as they
become absolute and matured. The Calculation of Solvent for each Credit
Party shall be made for such Credit Party and its Subsidiaries on a
consolidated basis. Furthermore, (i) the assets of each Credit Party
shall include, without limitation, goodwill and the rights and
properties of such Credit Party pursuant to Section 4.8, to the extent
of their fair value or fair saleable value, as applicable; and (ii)
contingent liabilities, at any time, will be equal to the amount which,
in light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability; it being understood that the contingent
liabilities under the Tax Indemnification Agreements and the
Transaction Agreement shall be assumed to be zero for the purpose of
calculating whether any Credit Party is Solvent
20
because, as of the Closing Date, each Credit Party believes that there
is no reasonable expectation of any actual liability.
"Spin-Off" has the meaning set forth in Section 5.1(e).
"Subsidiary" means, as to any Person, (a) any corporation more
than 50% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at the time, any class
or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by
such Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture, limited liability company or
other entity in which such person directly or indirectly through
Subsidiaries has more than a 50% equity interest at any time.
"Swing Line Loans" means the loans made by NationsBank
pursuant to Section 2.4.
"Swing Line Committed Amount" means Ten Million Dollars
($10,000,000).
"Swing Line Loan Request" means a request by the Borrower for
a Swing Line Loan in substantially the form of Exhibit 2.4(b).
"Swing Line Loan Note" means the promissory note of the
Borrower in favor of NationsBank evidencing the Swing Line Loans
provided pursuant to Section 2.4, as such promissory note may be
amended, modified, supplemented, extended, renewed or replaced from
time to time in and as evidenced by the form of Exhibit 2.4(e).
"Syndication Agent" means Wachovia Bank of Georgia, N.A.
"Tax Indemnification Agreements" means the Corning/CPS
Spin-Off Tax Indemnification Agreement to be entered into between
Corning Incorporated and the Borrower, the CPS/CCL Spin-Off Tax
Indemnification Agreement to be entered into between the Borrower and
Corning Clinical Laboratories Inc. and the CCL/CPS Spin-Off Tax
Indemnification Agreement to be entered into between Corning Clinical
Laboratories Inc. and the Borrower, each as it may be amended,
supplemented or otherwise modified from time to time in accordance with
its terms.
"Tax Sharing Agreement" means that certain Tax Sharing
Agreement to be entered into by and among Corning Incorporated, Corning
Clinical Laboratories Inc. and the Borrower, each as it may be amended,
modified, supplemented or otherwise modified from time to time in
accordance with its terms.
"Termination Event" means (a) with respect to any Single
Employer Plan, the occurrence of a Reportable Event or the substantial
cessation of operations (within the meaning of Section 4062(e) of
ERISA); (b) the withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a substantial employer (as such term
is defined in Section 4001(a)(2) of
21
ERISA), or the termination of a Multiple Employer Plan; (c) the
distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA;
(d) the institution of proceedings to terminate or the actual
termination of a Plan by the PBGC under Section 4042 of ERISA; (e) any
event or condition which might reasonably constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan; or (f) the complete or partial
withdrawal of any Credit Party or any of its Subsidiaries or any ERISA
Affiliate from a Multiemployer Plan. For the purposes of subsections
(d) and (e) of this definition, "ERISA Affiliate" means an entity,
whether or not incorporated, which is under common control with any
Credit Party or any of its Subsidiaries within the meaning of Section
4001(a)(14) of ERISA, or is a member of a group which includes any
Credit Party or any of its Subsidiaries and which is treated as a
single employer under Section 414(b), (c), (m), or (o) of the Code;
provided, however, that such definition shall apply only if such
Termination Event could reasonably be expected to have a Material
Adverse Effect. Otherwise, the definition of "ERISA Affiliate"
generally applicable under this Credit Agreement shall apply.
"Transaction Agreement" means the Transaction Agreement to be
entered into among Corning Incorporated, Corning Life Sciences Inc.,
Corning Clinical Laboratories Inc. and the Borrower, as may be amended,
supplemented or modified from time to time in accordance with its
terms.
"U.S. Dollar Equivalent" means the amount of Dollars that
would be realized by converting a Foreign Currency into Dollars using
the arithmetic average of the spot buying rates for such Foreign
Currency in Dollars as quoted to the Administrative Agent by three
foreign exchange dealers of recognized standing in the United States
selected by the Administrative Agent at approximately 10:00 a.m. on any
day on which a computation thereof is required to be made hereunder.
"Voting Stock" of a corporation means, at any time, all
classes of the capital stock of such corporation then outstanding and
ordinarily entitled to vote in the election of directors.
1.2 Computation of Time Periods and Other Definitional Provisions. For
purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding." References in this Agreement to "Articles", "Sections", "Schedules"
or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits of or to
this Agreement unless otherwise specifically provided.
1.3 Accounting Terms. Except as otherwise expressly provided herein,
all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be
delivered to the Lenders hereunder shall be prepared, in accordance with GAAP
applied on a consistent basis. All calculations made for the purposes of
determining compliance with this Credit Agreement shall (except as otherwise
expressly provided herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 7.1 (or, prior to the delivery of the first
financial statements pursuant to Section 7.1, consistent with the financial
statements described in Section
22
5.1(c)); provided, however, if (a) the Borrower shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
either Agent or the Required Lenders shall so object in writing within 60 days
after delivery of such financial statements (or after the Lenders have been
informed of the change in GAAP affecting such financial statements, if later),
then for the period following such objection, unless otherwise agreed by the
Borrower and the Required Lenders, such calculations shall be made on a basis
consistent with the most recent financial statements delivered by the Borrower
to the Lenders as to which no such objection shall have been made.
SECTION 2
CREDIT FACILITIES
2.1 Revolving Loans.
(a) Revolving Loan Commitment. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make
revolving loans (each a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrower, in Dollars or in Foreign Currency,
at any time and from time to time, during the period from and including
the Effective Date to but not including the Revolving Loan Maturity
Date (or such earlier date if the Revolving Committed Amount has been
terminated as provided herein); provided, however, that (i) the sum of
the aggregate amount of Revolving Loans outstanding plus the aggregate
amount of LOC Obligations outstanding plus the aggregate amount of
Swing Line Loans outstanding plus the aggregate amount of Competitive
Bid Loans outstanding shall not exceed the Revolving Committed Amount,
(ii) with respect to each individual Lender, the Lender's pro rata
share of outstanding Revolving Loans plus such Lender's pro rata share
of outstanding LOC Obligations shall not exceed such Lender's Revolving
Loan Commitment Percentage of the Revolving Committed Amount and (iii)
the amount of Revolving Loans outstanding in Foreign Currency plus
Competitive Bid Loans outstanding in Foreign Currency shall not exceed
the U.S. Dollar Equivalent of Fifty Million Dollars ($50,000,000).
Subject to the terms of this Credit Agreement (including Section 3.3),
the Borrower may borrow, repay and reborrow Revolving Loans.
(b) Method of Borrowing for Revolving Loans. By no later than
11:00 a.m. (i) one Business Day prior to the date of the requested
borrowing of Revolving Loans that will be Base Rate Loans or (ii) three
Business Days prior to the date of the requested borrowing of Revolving
Loans that will be Eurocurrency Loans, the Borrower shall submit a
written Notice of Borrowing in substantially the form of Exhibit 2.1(b)
to the Administrative Agent setting forth (A) the amount requested, (B)
whether such Revolving Loans shall accrue interest at the Base Rate or
the Adjusted Eurocurrency Rate, (C) with respect to Revolving Loans
that will be Eurocurrency Loans, the Interest Period applicable
thereto, (D) whether the Revolving Loan is requested in Dollars or in a
Foreign Currency and (E) certification that the Borrower has complied
in all respects with Section 5.2. Notwithstanding the above, the
Borrower may not request Revolving Loans made in a Foreign Currency to
accrue interest at the Base Rate unless the Adjusted Eurocurrency Rate
is not available.
23
(c) Funding of Revolving Loans. Upon receipt of a Notice of
Borrowing, the Administrative Agent shall promptly inform the Lenders
as to the terms thereof. Each Lender shall make its Revolving Loan
Commitment Percentage of the requested Revolving Loans available to the
Administrative Agent by 1:00 p.m. on the date specified in the Notice
of Borrowing by deposit, in Dollars or the applicable Foreign Currency,
of immediately available funds at the principal office of the
Administrative Agent in Charlotte, North Carolina or at such other
address as the Administrative Agent may designate in writing. The
amount of the requested Revolving Loans will then be made available to
the Borrower by the Administrative Agent by crediting the account of
the Borrower on the books of such office of the Administrative Agent,
to the extent the amount of such Revolving Loans are made available to
the Administrative Agent.
No Lender shall be responsible for the failure or delay by any
other Lender in its obligation to make Revolving Loans hereunder;
provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its
obligations hereunder. Unless the Administrative Agent shall have been
notified by any Lender prior to the time of any such Revolving Loan
that such Lender does not intend to make available to the
Administrative Agent its portion of the Revolving Loans to be made on
such date, the Administrative Agent may assume that such Lender has
made such amount available to the Administrative Agent on the date of
such Revolving Loans, and the Administrative Agent in reliance upon
such assumption, may (in its sole discretion but without any obligation
to do so) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the
Borrower, and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from the Lender or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from
the date such corresponding amount was made available by the
Administrative Agent to the Borrower to the date such corresponding
amount is recovered by the Administrative Agent at a per annum rate
equal to (i) from the Borrower at the applicable rate for such
Revolving Loan pursuant to the Notice of Borrowing and (ii) from a
Lender at the Federal Funds Rate.
(d) Reductions of Revolving Committed Amount. Upon at least
three Business Days' notice, the Borrower shall have the right to
permanently terminate or reduce the aggregate unused amount of the
Revolving Committed Amount at any time or from time to time; provided
that (i) each partial reduction shall be in an aggregate amount at
least equal to $5,000,000 and in integral multiples of $1,000,000 above
such amount and (ii) no reduction shall be made which would reduce the
Revolving Committed Amount to an amount less than the aggregate amount
of outstanding Revolving Loans plus the aggregate amount of outstanding
LOC Obligations plus the aggregate amount of Swing Line Loans
outstanding plus the aggregate amount of Competitive Bid Loans
outstanding. Any reduction in (or termination of) the Revolving
Committed Amount shall be permanent and may not be reinstated. The
Administrative Agent shall immediately notify the Lenders of any
reduction in the Revolving Committed Amount.
24
(e) Continuations and Conversions. Subject to the terms of
Section 5.2 (other than Section 5.2(b)), the Borrower shall have the
option, on any Business Day, to continue existing Eurocurrency Loans
for a subsequent Interest Period, to convert Base Rate Loans into
Eurocurrency Loans or to convert Eurocurrency Loans into Base Rate
Loans; provided, however, that (i) each such continuation or conversion
must be requested by the Borrower pursuant to a written Notice of
Continuation/Conversion, in substantially the form of Exhibit 2.1(e),
in compliance with the terms set forth below, (ii) except as provided
in Section 3.11, Eurocurrency Loans may only be continued or converted
into Base Rate Loans on the last day of the Interest Period applicable
thereto, (iii) Eurocurrency Loans may not be continued nor may Base
Rate Loans be converted into Eurocurrency Loans during the existence
and continuation of a Default or Event of Default and (iv) any request
to continue a Eurocurrency Loan that fails to comply with the terms
hereof or any failure to request a continuation of a Eurocurrency Loan
at the end of an Interest Period shall constitute a conversion to a
Base Rate Loan on the last day of the applicable Interest Period. Each
continuation or conversion must be requested by the Borrower no later
than 11:00 a.m. (A) one Business Day prior to the date for a requested
conversion of a Eurocurrency Loan to a Base Rate Loan or (B) three
Business Days prior to the date for a requested continuation of a
Eurocurrency Loan or conversion of a Base Rate Loan to a Eurocurrency
Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which
shall set forth (x) whether the Borrower wishes to continue or convert
such Loans and (y) if the request is to continue a Eurocurrency Loan or
convert a Base Rate Loan to a Eurocurrency Loan, the Interest Period
applicable thereto. Notwithstanding the foregoing, Loans made in
Foreign Currency may not be continued or converted pursuant to this
Section 2.1(e) but instead must be repaid at the end of the applicable
Interest Period in the Foreign Currency in which such Loan was made.
(f) Minimum Amounts. Each request for a borrowing, conversion
or continuation shall be subject to the requirements that (i) each
Eurocurrency Loan shall be in a minimum amount of $5,000,000 and in
integral multiples of $1,000,000 in excess thereof, or in the case of a
Foreign Currency, the U.S. Dollar Equivalents of such amounts, (ii)
each Base Rate Loan shall be in a minimum amount of the lesser of
$1,000,000 (and integral multiples of $100,000 in excess thereof) or
the remaining amount available under the Revolving Committed Amount, or
in the case of a Foreign Currency, the U.S. Dollar Equivalents of such
amounts and (iii) no more than eight Eurocurrency Loans shall be
outstanding hereunder at any one time. For the purposes of this
Section, all Eurocurrency Loans with the same Interest Periods shall be
considered as one Eurocurrency Loan, but Eurocurrency Loans with
different Interest Periods, even if they begin on the same date, shall
be considered as separate Eurocurrency Loans.
(g) Notes. The Revolving Loans made by each Lender shall be
evidenced by a duly executed promissory note of the Borrower to each
applicable Lender in the face amount of its Revolving Loan Commitment
Percentage of the Revolving Committed Amount in substantially the form
of Exhibit 2.1(g).
25
2.2 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and
of the LOC Documents, if any, and any other terms and conditions which
the Issuing Lender may reasonably require (so long as such terms and
conditions do not impose any financial obligation on or require any
Lien (not otherwise contemplated by this Agreement) to be given by any
Credit Party or conflict with any obligation of, or detract from any
action which may be taken by, any Credit Party or their Subsidiaries
under this Agreement), the Issuing Lender shall from time to time upon
request issue (from the Effective Date to the Revolving Loan Maturity
Date and in a form reasonably acceptable to the Issuing Lender), in
Dollars, and the LOC Participants shall participate in, letters of
credit (the "Letters of Credit") for the account of the Borrower or any
of its Subsidiaries; provided, however, that (i) the aggregate amount
of LOC Obligations shall not at any time exceed the LOC Committed
Amount, (ii) the sum of the aggregate amount of LOC Obligations
outstanding plus Revolving Loans outstanding plus Swing Line Loans
outstanding plus Competitive Bid Loans outstanding shall not exceed the
Revolving Committed Amount and (iii) with respect to each individual
LOC Participant, the LOC Participant's pro rata share of outstanding
Revolving Loans plus its pro rata share of outstanding LOC Obligations
shall not exceed such LOC Participant's Revolving Loan Commitment
Percentage of the Revolving Committed Amount. The issuance and expiry
date of each Letter of Credit shall be a Business Day. Except as
otherwise expressly agreed upon by all the LOC Participants, each
Letter of Credit shall have an original expiry date not more than one
year from the date of issuance; provided that, at the option of the
Borrower, Letters of Credit may be subject to automatic renewal for
periods not in excess of one year subject to the conditions that (x)
the Issuing Lender may give notice to the Borrower not less than 60
days prior to the effective date of such extension that it will not
extend such Letter of Credit (and, during the existence and
continuation of an Event of Default, the Issuing Lender agrees to give
such notice if instructed by the Required Lenders to do so) and (y) no
Letter of Credit (or renewal thereof), shall have an expiry date
extending beyond the Revolving Loan Maturity Date. Each Letter of
Credit shall be either (x) a standby letter of credit issued to support
the obligations (including pension or insurance obligations),
contingent or otherwise, of the Borrower or any of its Subsidiaries, or
(y) a commercial letter of credit in respect of the purchase of goods
or services by the Borrower or any of its Subsidiaries in the ordinary
course of business. Each Letter of Credit shall comply with the related
LOC Documents.
(b) Notice and Reports. The request for the issuance or
renewal of a Letter of Credit shall be submitted to the Issuing Lender
at least three Business Days prior to the requested date of issuance or
renewal. The Issuing Lender will, at least quarterly and more
frequently upon request, provide to the Administrative Agent for
dissemination to the Lenders a detailed report specifying the Letters
of Credit which are then issued and outstanding and any activity with
respect thereto which may have occurred since the date of the prior
report, and including therein, among other things, the account party,
the beneficiary, the face amount, and the expiry date as well as any
payments or expirations which may have occurred. The Issuing Lender
will further provide to the Administrative Agent, promptly upon
request, copies of the Letters of Credit and the other LOC Documents.
26
(c) Participations. Each LOC Participant, upon issuance of a
Letter of Credit, shall be deemed to have purchased without recourse a
risk participation from the Issuing Lender in such Letter of Credit and
each LOC Document related thereto and the rights and obligations
arising thereunder and any collateral relating thereto, in each case in
an amount equal to its Revolving Loan Commitment Percentage of the
obligations under such Letter of Credit, and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as
surety, and be obligated to pay to the Issuing Lender therefor and
discharge when due, its Revolving Loan Commitment Percentage of the
obligations arising under such Letter of Credit. Without limiting the
scope and nature of each LOC Participant's participation in any Letter
of Credit, to the extent that the Issuing Lender has not been
reimbursed as required hereunder or under any such Letter of Credit,
each such LOC Participant shall pay to the Issuing Lender its Revolving
Loan Commitment Percentage of such unreimbursed drawing in same day
funds on the day of notification by the Issuing Lender of an
unreimbursed drawing pursuant to the provisions of subsection (d)
hereof. The obligation of each LOC Participant to so reimburse the
Issuing Lender shall be absolute and unconditional and shall not be
affected by the occurrence of a Default, an Event of Default or any
other occurrence or event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrower or any other Credit
Party to reimburse the Issuing Lender under any Letter of Credit,
together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the Borrower.
Unless the Borrower shall immediately notify the Issuing Lender of its
intent to otherwise reimburse the Issuing Lender, the Borrower shall be
deemed to have requested a Revolving Loan in Dollars at the Base Rate
in the amount of the drawing as provided in subsection (e) hereof, the
proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower shall reimburse the Issuing Lender on the day
of drawing (unless such notice is received after 1:00 p.m. on such day
and then on the next succeeding Business Day with the outstanding
amount accruing interest at the Base Rate until reimbursed) under any
Letter of Credit either with the proceeds of a Revolving Loan obtained
hereunder or otherwise in same day funds as provided herein or in the
LOC Documents. If the Borrower shall fail to reimburse the Issuing
Lender as provided hereinabove, the unreimbursed amount of such drawing
shall bear interest at a per annum rate equal to the Base Rate plus two
percent (2%). The Borrower's reimbursement obligations hereunder shall
be absolute and unconditional under all circumstances irrespective of
(but without waiver of) any rights of set-off, counterclaim or defense
to payment that the applicable account party or the Borrower may claim
or have against the Issuing Lender, the Agents, the Lenders, the
beneficiary of the Letter of Credit drawn upon or any other Person,
including without limitation, any defense based on any failure of the
applicable account party, the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or
unenforceability of the Letter of Credit. The Issuing Lender will
promptly notify the LOC Participants of the amount of any unreimbursed
drawing and each LOC Participant shall promptly pay to the
Administrative Agent for the account of the Issuing Lender, in Dollars
and in immediately available funds, the amount of such LOC
Participant's Revolving Loan Commitment Percentage of such unreimbursed
drawing. Such payment shall be made on the day such notice is received
by such Lender from the Issuing Lender if such notice is received at or
before 2:00 p.m., otherwise such
27
payment shall be made at or before 12:00 Noon on the Business Day next
succeeding the day such notice is received. If such LOC Participant
does not pay such amount to the Issuing Lender in full upon such
request, such LOC Participant shall, on demand, pay to the
Administrative Agent for the account of the Issuing Lender interest on
the unpaid amount during the period from the date the LOC Participant
received the notice regarding the unreimbursed drawing until such LOC
Participant pays such amount to the Issuing Lender in full at a rate
per annum equal to, if paid within two Business Days of the date of
drawing, the Federal Funds Rate and thereafter at a rate equal to the
Base Rate. Each LOC Participant's obligation to make such payment to
the Issuing Lender, and the right of the Issuing Lender to receive the
same, shall be absolute and unconditional, shall not be affected by any
circumstance whatsoever and without regard to the termination of this
Credit Agreement or the Commitments hereunder, the existence of a
Default or Event of Default or the acceleration of the obligations
hereunder and shall be made without any offset, abatement, withholding
or reduction whatsoever. Simultaneously with the making of each such
payment by a LOC Participant to the Issuing Lender, such LOC
Participant shall, automatically and without any further action on the
part of the Issuing Lender or such LOC Participant, acquire a
participation in an amount equal to such payment (excluding the portion
of such payment constituting interest owing to the Issuing Lender) in
the related unreimbursed drawn portion of the LOC Obligation and in the
interest thereon and in the related LOC Documents, and shall have a
claim against the Borrower and the other Credit Parties with respect
thereto (including the reimbursement obligation).
(e) Repayment with Revolving Loans. On any day on which the
Borrower shall have requested, or been deemed to have requested, a
Revolving Loan borrowing to reimburse a drawing under a Letter of
Credit, the Administrative Agent shall give notice to the applicable
Lenders that a Revolving Loan has been requested or deemed requested in
connection with a drawing under a Letter of Credit, in which case a
Revolving Loan borrowing comprised solely of Base Rate Loans in Dollars
(each such borrowing, a "Mandatory Borrowing") shall be immediately
made from all applicable Lenders (without giving effect to any
termination of the Commitments pursuant to Section 9.2) pro rata based
on each Lender's respective Revolving Loan Commitment Percentage and
the proceeds thereof shall be paid directly to the Issuing Lender for
application to the respective LOC Obligations. Each such Lender hereby
irrevocably agrees to make such Revolving Loans immediately upon any
such request or deemed request on account of each such Mandatory
Borrowing in the amount and in the manner specified in the preceding
sentence and on the same such date notwithstanding (i) the amount of
Mandatory Borrowing may not comply with the minimum amount for
borrowings of Revolving Loans otherwise required hereunder, (ii)
whether any conditions specified in Section 5 are then satisfied, (iii)
whether a Default or Event of Default then exists, (iv) failure of any
such request or deemed request for Revolving Loans to be made by the
time otherwise required hereunder, (v) the date of such Mandatory
Borrowing, or (vi) any reduction in the Revolving Committed Amount or
any termination of the Commitments. In the event that any Mandatory
Borrowing cannot for any reason be made on the date otherwise required
above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code with respect to the Borrower
or any other Credit Party), then each such Lender hereby agrees that it
shall forthwith fund (as of the date the Mandatory Borrowing would
otherwise have occurred, but
28
adjusted for any payments received from the Borrower on or after such
date and prior to such purchase) its Participation Interest in the
outstanding LOC Obligations; provided that in the event any Lender
shall fail to fund its Participation Interest on the day the Mandatory
Borrowing would otherwise have occurred, then the amount of such
Lender's unfunded Participation Interest therein shall bear interest
payable to the Issuing Lender upon demand, at the rate equal to, if
paid within two Business Days of such date, the Federal Funds Rate, and
thereafter at a rate equal to the Base Rate.
(f) Modification and Extension. The issuance of any
supplement, modification or amendment, renewal, or extensions
(excluding extensions on an "evergreen" basis pursuant to Section
2.2(a)) to any Letter of Credit shall, for purposes hereof, be treated
in all respects the same as the issuance of a new Letter of Credit
hereunder.
(g) Uniform Customs and Practices. The Issuing Lender may have
the Letters of Credit be subject to The Uniform Customs and Practice
for Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (Publication No. 500 or the most
recent publication, the "UCP"), in which case the UCP may be
incorporated therein and deemed in all respects to be a part thereof.
(h) Responsibility of Issuing Lender. It is expressly
understood and agreed as between the Lenders that the obligations of
the Issuing Lender hereunder to the LOC Participants are only those
expressly set forth in this Credit Agreement and that the Issuing
Lender shall be entitled to assume that the conditions precedent set
forth in Section 5 have been satisfied unless it shall have acquired
actual knowledge that any such condition precedent has not been
satisfied; provided, however, that nothing set forth in this Section
2.2 shall be deemed to prejudice the right of any LOC Participant to
recover from the Issuing Lender any amounts made available by such LOC
Participant to the Issuing Lender pursuant to this Section 2.2 in the
event that it is determined by a court of competent jurisdiction that
the payment with respect to a Letter of Credit constituted gross
negligence or willful misconduct on the part of the Issuing Lender.
(i) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document, this Credit
Agreement shall govern.
(j) Indemnification of Issuing Lender.
(i) In addition to its other obligations under
this Credit Agreement, the Borrower hereby agrees to protect,
indemnify, pay and save the Issuing Lender harmless from and
against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be
subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of the
Issuing Lender to honor a drawing under a Letter of Credit as
a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein
called "Government Acts").
29
(ii) As between the Borrower and the Issuing
Lender, the Borrower shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary
thereof. The Issuing Lender shall not be responsible for
(except in the case of (A), (B) and (C) below if the Issuing
Lender has actual knowledge to the contrary): (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect
of any document submitted by any party in connection with the
application for and issuance of any Letter of Credit, even if
it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) failure of the beneficiary of
a Letter of Credit to comply fully with conditions required in
order to draw upon a Letter of Credit; (D) errors, omissions,
interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (E) errors in interpretation
of technical terms; (F) any loss or delay in the transmission
or otherwise of any document required in order to make a
drawing under a Letter of Credit or of the proceeds thereof;
and (G) any consequences arising from causes beyond the
control of the Issuing Lender, including, without limitation,
any Government Acts. None of the above shall affect, impair,
or prevent the vesting of the Issuing Lender's rights or
powers hereunder.
(iii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by the Issuing Lender, under or in
connection with any Letter of Credit or the related
certificates, if taken or omitted in good faith, shall not put
the Issuing Lender under any resulting liability to the
Borrower or any other Credit Party. It is the intention of the
parties that this Credit Agreement shall be construed and
applied to protect and indemnify the Issuing Lender against
any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower,
including, without limitation, any and all risks of the acts
or omissions, whether rightful or wrongful, of any present or
future Government Acts. The Issuing Lender shall not, in any
way, be liable for any failure by the Issuing Lender or anyone
else to pay any drawing under any Letter of Credit as a result
of any Government Acts or any other cause beyond the control
of the Issuing Lender.
(iv) Nothing in this subsection (j) is intended
to limit the reimbursement obligation of the Borrower
contained in this Section 2.2. The obligations of the Borrower
under this subsection (j) shall survive the termination of
this Credit Agreement. No act or omission of any current or
prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Issuing Lender to enforce
any right, power or benefit under this Credit Agreement.
(v) Notwithstanding anything to the contrary
contained in this subsection (j), the Borrower shall have no
obligation to indemnify the Issuing Lender in respect of any
liability incurred by the Issuing Lender arising solely out of
the
30
gross negligence or willful misconduct of the Issuing Lender,
as determined by a court of competent jurisdiction. Nothing in
this Agreement shall relieve the Issuing Lender of any
liability to the Borrower in respect of any action taken by
the Issuing Lender which action constitutes gross negligence
or willful misconduct of the Issuing Lender or a violation of
the UCP or Uniform Commercial Code (as applicable), as
determined by a court of competent jurisdiction. The Borrower
shall have a claim against the Issuing Lender, and the Issuing
Lender shall be liable to the Borrower, to the extent of any
direct, but not consequential, damages suffered by the
Borrower that the Borrower proves were caused by (i) the
Issuing Lender's willful misconduct or gross negligence in
determining whether documents presented under any Letter of
Credit comply with the terms of the Letter of Credit or (ii)
the Issuing Lender's willful failure to make lawful payment
under a Letter of Credit after the presentation to it of a
draft and certificates strictly complying with the terms and
conditions of the Letter of Credit.
2.3 Competitive Bid Loans Subfacility.
(a) Competitive Bid Loans. Subject to the terms and conditions
set forth herein, the Borrower may, from time to time, during the
period from and including the Effective Date to but not including the
Revolving Loan Maturity Date, request and each Lender may, in its sole
discretion, agree to make Competitive Bid Loans, in Dollars or in
Foreign Currency, to the Borrower; provided, however, that (i) the sum
of the Revolving Loans outstanding plus Competitive Bid Loans
outstanding plus Swing Line Loans outstanding plus the aggregate amount
of LOC Obligations outstanding, shall not exceed the Revolving
Committed Amount, (ii) if a Lender does make a Competitive Bid Loan it
shall not reduce such Lender's obligation to make its pro rata share of
any Revolving Loan, and (iii) the amount of Revolving Loans outstanding
in Foreign Currency plus Competitive Bid Loans outstanding in Foreign
Currency shall not exceed the U.S. Dollar Equivalent of Fifty Million
Dollars ($50,000,000).
(b) Competitive Bid Requests. The Borrower may solicit
Competitive Bids by delivery of a Competitive Bid Loan Request to the
Administrative Agent by 10:00 a.m. on a Business Day not less than (x)
in the case of Fixed Rate Competitive Loans not made in a Foreign
Currency, three Business Days and (y) in the case of Eurocurrency
Competitive Loans and Fixed Rate Competitive Loans made in a Foreign
Currency, five Business Days prior to the date of a requested
Competitive Bid Loan. A Competitive Bid Loan Request must be
substantially in the form of Exhibit 2.3(b) and shall specify (i) the
date of the requested Competitive Bid Loan (which shall be a Business
Day), (ii) the amount of the requested Competitive Bid Loan, (iii) the
applicable Interest Periods requested (iv) whether such Competitive Bid
Loan will be a Eurocurrency Competitive Loan or a Fixed Rate
Competitive Loan, and (v) whether such Competitive Bid Loan is to be
made in Dollars or in Foreign Currency and shall be accompanied by the
Competitive Bid Request Fee set forth in the Fee Letter and shall
comply in all respects with Section 5.2. The Administrative Agent shall
notify the Lenders of its receipt of a Competitive Bid Request and the
contents thereof and invite the Lenders to submit Competitive Bids in
response thereto. The Borrower may not request a Competitive Bid for
more than three different Interest Periods
31
per Competitive Bid Request and Competitive Bid Requests may be made no
more frequently than once every five Business Days.
(c) Competitive Bid Procedure. Each Lender may, in its sole
discretion, make one or more Competitive Bids to the Borrower in
response to a Competitive Bid Request. Each Competitive Bid must be
received by the Administrative Agent not later than 10:00 a.m. (x) in
the case of Fixed Rate Competitive Loans not made in a Foreign Currency
on the proposed date of a Competitive Bid Loan advance and (y) in the
case of Eurocurrency Competitive Loans and Fixed Rate Competitive Loans
made in a Foreign Currency, three Business Days prior to the proposed
dated of a Competitive Bid Loan advance; provided, however, that should
the Administrative Agent, in its capacity as a Lender, desire to submit
a Competitive Bid it shall notify the Borrower of its Competitive Bid
and the terms thereof not later than 9:30 a.m. on such date. A Lender
may offer to make all or part of the requested Competitive Bid Loan and
may submit multiple Competitive Bids in response to a Competitive Bid
Request. The Competitive Bid must specify (i) the particular
Competitive Bid Request as to which the Competitive Bid is submitted,
(ii) the minimum (which shall be not less than $1,000,000 and integral
multiples of $500,000 in excess thereof, or in the case of a Foreign
Currency, the U.S. Dollar Equivalent), and maximum principal amounts of
the requested Competitive Bid Loan or Loans as to which the Lender is
willing to make, (iii) the applicable interest rate or rates (which (A)
in the case of a Eurocurrency Competitive Loan, shall be the
Eurocurrency Rate for the Interest Period in effect for such Loan plus
the margin offered by such Lender and accepted by the Borrower and (B)
in the case of a Fixed Rate Competitive Loan, shall be a fixed rate per
annum (computed on the basis of a 360-day year or the actual number of
days elapsed) offered by such Lender and accepted by the Borrower) (the
"Fixed Rate") and Interest Period or Interest Periods therefor, (iv)
whether such Competitive Bid Loan will be a Eurocurrency Competitive
Loan or a Fixed Rate Competitive Loan and (v) the currency in which the
Competitive Bid is made. A Competitive Bid submitted by a Lender in
accordance with the provisions hereof shall be irrevocable. The
Administrative Agent shall promptly notify the Borrower of all
Competitive Bids made and the terms thereof and shall send a copy of
each of the Competitive Bids to the Borrower for its records as soon as
practicable.
(d) Acceptance of Competitive Bids. The Borrower may, in its
sole discretion, subject only to the provisions of this subsection (d),
accept or refuse any Competitive Bid offered to it. To accept a
Competitive Bid, the Borrower shall give telephonic notification of its
acceptance of any or all such Competitive Bids to the Administrative
Agent by 11:00 a.m. on the proposed date of a Competitive Bid Loan
which shall be promptly confirmed in writing; provided, however, (i)
the failure by the Borrower to give timely notice of its acceptance of
a Competitive Bid shall be deemed to be a refusal thereof, (ii) to the
extent Competitive Bids are for comparable Interest Periods, the
Borrower may accept Competitive Bids only in ascending order of rates,
(iii) the aggregate amount of Competitive Bids accepted by the Borrower
shall not exceed the principal amount specified in the Competitive Bid
Request, (iv) if the Borrower shall accept a bid or bids made at a
particular Competitive Bid Rate, but the amount of such bid or bids
shall cause the total amount of bids to be accepted by the Borrower to
be in excess of the amount specified in the Competitive Bid Request,
then the Borrower shall accept a portion of such bid or bids in an
amount equal to
32
the amount specified in the Competitive Bid Request less the amount of
all other Competitive Bids accepted with respect to such Competitive
Bid Request, which acceptance shall be made pro rata in accordance with
the amount of each such bid at such Competitive Bid Rate and (v) no bid
shall be accepted for a Competitive Bid Loan unless such Competitive
Bid Loan is in a minimum principal amount of $1,000,000 and integral
multiples of $500,000 in excess thereof or in the case of a Foreign
Currency, the U.S. Dollar equivalent, except that where a portion of a
Competitive Bid is accepted in accordance with the provisions of
subsection (iv) hereof, then in a minimum principal amount of $100,000
and integral multiples of $100,000 (but not in any event less than the
minimum amount specified in the Competitive Bid), and in calculating
the pro rata allocation of acceptances of portions of multiple bids at
a particular Competitive Bid Rate pursuant to subsection (iv) hereof,
the amounts shall be rounded to integral multiples of $100,000, or in
the case of a Foreign Currency, the U.S. Dollar equivalent, in a manner
which shall be in the discretion of the Borrower. A notice of
acceptance of a Competitive Bid given by the Borrower in accordance
with the provisions hereof shall be irrevocable. The Administrative
Agent shall, not later than 1:00 p.m. on the date of receipt from the
Borrower of its acceptance or rejection of Competitive Bid, notify each
bidding Lender whether or not its Competitive Bid has been accepted
(and if so, in what amount and at what Competitive Bid Rate), and each
successful bidder will thereupon become bound, subject to the other
applicable conditions hereof, to make the Competitive Bid Loan in
respect of which its bid has been accepted.
(e) Funding of Competitive Bid Loans. Each Lender that is to
make a Competitive Bid Loan shall make its Competitive Bid Loan
available to the Administrative Agent by 2:00 P.M. on the date
specified in the Competitive Bid Request by deposit in Dollars or the
applicable Foreign Currency of immediately available funds at the
office of the Administrative Agent in Charlotte, North Carolina, or at
such other address as the Administrative Agent may designate in
writing. The Administrative Agent will, upon receipt, make the proceeds
of such Competitive Bid Loans available to the Borrower.
(f) Maturity of Competitive Bid Loans. Each Competitive Bid
Loan shall mature and be due and payable in full, in the currency in
which made, on the last day of the Interest Period applicable thereto.
Unless the Borrower shall give notice to the Administrative Agent
otherwise, or a Default or Event of Default exists and is continuing,
on the Business Day prior to the last day of the applicable Interest
Period of a maturing Competitive Bid Loan, the Borrower shall be deemed
to have requested from all of the Lenders Revolving Loans in Dollars in
the amount of such maturing Competitive Bid Loan, accruing interest at
the Base Rate, the proceeds of which will be used to repay such
Competitive Bid Loan.
(g) Minimum Amounts. Each Competitive Bid Loan shall be in an
amount not less than $1,000,000 and in integral multiples of $100,000
thereof.
(h) Competitive Bid Loan Notes. The Competitive Bid Loans made
by each Lender shall be evidenced by a duly executed promissory note of
the Borrower to such Lender in the original principal amount of the
Revolving Committed Amount and in substantially the form of Exhibit
2.3(h).
33
2.4 Swing Line Loans Subfacility.
(a) Swing Line Loans. NationsBank hereby agrees, on the terms
and subject to the conditions set forth herein and in the other Credit
Documents, to make loans to the Borrower in Dollars at any time and
from time to time during the period from and including the Effective
Date to but not including the Revolving Loan Maturity Date (each such
loan, a "Swing Line Loan" and collectively, the "Swing Line Loans");
provided that (i) the aggregate principal amount of the Swing Line
Loans outstanding at any one time shall not exceed the Swing Line
Committed Amount and (ii) the sum of Swing Line Loans outstanding plus
Revolving Loans outstanding plus Competitive Bid Loans outstanding plus
the aggregate amount of LOC Obligations outstanding shall not exceed
the Revolving Committed Amount. Prior to the Revolving Loan Maturity
Date, Swing Line Loans may be repaid and reborrowed by the Borrower in
accordance with the provisions hereof. Upon the request of any Lender,
NationsBank shall provide such Lender a schedule of Swing Line Loans
then outstanding.
(b) Method of Borrowing and Funding Swing Line Loans. By no
later than 10:00 a.m., on the date of the requested borrowing of Swing
Line Loans, the Borrower shall submit a Swing Line Loan Request to
NationsBank in the form of Exhibit 2.4(b) setting forth (i) the amount
of the requested Swing Line Loan, (ii) the date of the requested Swing
Line Loan and (iii) whether such Swing Line Loan is to be a Base Rate
Loan or a Quoted Rate Swing Line Loan and if it is a Quoted Rate Swing
Line Loan, the applicable Interest Period and complying in all respects
with Section 5.2. If the Borrower has requested a Quoted Rate Swing
Line Loan, NationsBank shall provide to the Borrower, no later than
1:00 p.m. on the date of the request, the rate at which NationsBank
would be willing to provide such Swing Line Loan (the "Quoted Rate").
The Borrower shall notify NationsBank by 2:00 p.m. on such date whether
it wishes to accept the Quoted Rate. Failure of the Borrower to timely
accept the Quoted Rate shall make the Quoted Rate and the corresponding
Swing Line Loan Request void.
(c) Repayment and Participations of Swing Line Loans. The
Borrower agrees to repay all Swing Line Loans that are Base Rate Loans
within one Business Day of demand therefor by NationsBank and all Swing
Line Loans that are Quoted Rate Swing Line Loans at the end of the
applicable Interest Period. Each repayment of a Swing Line Loan may be
accomplished by requesting Revolving Loans which request is not subject
to the conditions set forth in Section 5.2(b). In the event that the
Borrower shall fail to timely repay any Swing Line Loan, and in any
event upon (i) a request by NationsBank, (ii) the occurrence of an
Event of Default described in Section 9.1(f) or (iii) the acceleration
of any Loan or termination of any Commitment pursuant to Section 9.2,
each other Lender shall irrevocably and unconditionally purchase from
NationsBank, without recourse or warranty, an undivided interest and
participation in such Swing Line Loan in an amount equal to such other
Lender's Revolving Loan Commitment Percentage thereof, by directly
purchasing a participation in such Swing Line Loan in such amount
(regardless of whether the conditions precedent thereto set forth in
Section 5.2 hereof are then satisfied, whether or not the Borrower has
submitted a Notice of Borrowing and whether or not the Commitments are
then in effect, any Event of Default exists or all the Loans have been
accelerated) and paying the proceeds
34
thereof to NationsBank at the address provided in Section 11.1, or at
such other address as NationsBank may designate, in Dollars and in
immediately available funds. If such amount is not in fact made
available to NationsBank by any Lender, NationsBank shall be entitled
to recover such amount on demand from such Lender, together with
accrued interest thereon for each day from the date of demand thereof,
at the Federal Funds Rate. If such Lender does not pay such amount
forthwith upon NationsBank's demand therefor, and until such time as
such Lender makes the required payment, NationsBank shall be deemed to
continue to have outstanding Swing Line Loans in the amount of such
unpaid participation obligation for all purposes of the Credit
Documents other than those provisions requiring the other Lenders to
purchase a participation therein. Further, such Lender shall be deemed
to have assigned any and all payments made of principal and interest on
its Loans, and any other amounts due to it hereunder to NationsBank to
fund Swing Line Loans in the amount of the participation in Swing Line
Loans that such Lender failed to purchase pursuant to this Section
2.4(c) until such amount has been purchased (as a result of such
assignment or otherwise).
(d) Minimum Amounts. Each Swing Line Loan shall be in the
minimum amount of $100,000 and in integral multiples of $50,000 in
excess thereof.
(e) Swing Line Note. The Swing Line Loans made by NationsBank
shall be evidenced by a duly executed promissory note of the Borrower
to NationsBank in the face amount of the Swing Line Committed Amount
and in substantially the form of Exhibit 2.4(e).
2.5 Currency Equivalents. For purposes of determining compliance with
Section 2.1 and Section 3.3(b), the amount of each Loan outstanding in a Foreign
Currency: (a) shall be converted to its U.S. Dollar Equivalent on the date of
the initial Notice of Borrowing or Competitive Bid Loan Request with respect
thereto and on the date of each Notice of Continuation/Conversion or Competitive
Bid Loan Request requesting a new Interest Period therefor and (b) from and
after any such date, shall be deemed to remain equivalent to the U.S. Dollar
Equivalent determined in accordance with clause (a) notwithstanding any
fluctuation in exchange rates occurring thereafter.
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest.
(a) Interest Rate. All Revolving Loans that are Base Rate
Loans shall accrue interest at the Base Rate. All Swing Line Loans
shall accrue interest at the Base Rate unless such Swing Line Loan is a
Quoted Rate Swing Line Loan then at the Quoted Rate applicable thereto.
All Competitive Bid Loans shall accrue interest at the Competitive Bid
Rate applicable thereto. All Revolving Loans that are Eurocurrency
Loans shall accrue interest at the Adjusted Eurocurrency Rate.
35
(b) Default Rate of Interest. Upon the occurrence, and during
the continuance, of an Event of Default, the principal of and, to the
extent permitted by law, interest on the Loans and any other amounts
owing hereunder or under the other Credit Documents (including without
limitation fees and expenses) shall bear interest, payable on demand,
at a per annum rate equal to (i) two percent (2%) plus the rate which
would otherwise be applicable or (ii) if no rate is applicable, the
Base Rate plus two percent (2%).
(c) Interest Payments. Interest on Loans shall be due and
payable in arrears on each Interest Payment Date. If an Interest
Payment Date falls on a date which is not a Business Day, such Interest
Payment Date shall be deemed to be the next succeeding Business Day,
except that in the case of Eurocurrency Loans where the next succeeding
Business Day falls in the next succeeding calendar month, then on the
next preceding Business Day.
3.2 Place and Manner of Payments. All payments of principal, interest,
fees, expenses and other amounts to be made by a Credit Party under this
Agreement shall be received not later than 2:00 p.m. on the date when due, in
Dollars or the applicable Foreign Currency and in same day funds, by the
Administrative Agent at its offices in Charlotte, North Carolina. Payments
received after such time shall be deemed to have been received on the next
Business Day. The Borrower shall, at the time it makes any payment under this
Agreement, specify to the Administrative Agent, the Loans, Letters of Credit,
fees or other amounts payable by the Borrower hereunder to which such payment is
to be applied (and in the event that it fails to specify, or if such application
would be inconsistent with the terms hereof, the Administrative Agent shall,
subject to Section 3.7, distribute such payment to the Lenders in such manner as
the Administrative Agent may deem appropriate). The Administrative Agent will
distribute such payments to the applicable Lenders if any such payment is
received prior to 2:00 p.m.; otherwise the Administrative Agent will distribute
such payment to the applicable Lenders on the next succeeding Business Day.
Whenever any payment hereunder shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day (subject to accrual of interest and fees for the period of such
extension), except that in the case of Eurocurrency Loans, if the extension
would cause the payment to be made in the next following calendar month, then
such payment shall instead be made on the next preceding Business Day.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right
to prepay Loans in whole or in part from time to time without premium
or penalty; provided, however, that (i) Eurocurrency Loans may only be
prepaid on three Business Days' prior written notice to the
Administrative Agent and any prepayment of Eurocurrency Loans will be
subject to Section 3.14; (ii) each such partial prepayment of Loans
shall be in the minimum principal amount of (A) $5,000,000 for
Revolving Loans, (B) $1,000,000 for Competitive Bid Loans and (C)
$100,000 for Swing Line Loans, or in the case of Foreign Currency the
U.S. Dollar Equivalent; and (iii) Competitive Bid Loans and Quoted Rate
Swing Line Loans may not be prepaid unless a breakage fee equal to the
amount of actual damages suffered by the Lender whose Competitive Bid
Loan or Quoted Rate Swing Line Loan is prepaid is paid to such Lender;
provided that such Lender shall provide the Borrower with the
calculation of such
36
damages. Amounts prepaid hereunder shall be applied as the Borrower may
elect; provided, that if the Borrower fails to specify a voluntary
prepayment then such prepayment shall be applied first to Revolving
Loans that are Base Rate Loans, then to Eurocurrency Loans in direct
order of Interest Period maturities, then to Swing Line Loans (first to
those accruing interest at the Base Rate and then at the Quoted Rate)
and then to Competitive Bid Loans pro rata among all Lenders holding
same.
(b) Mandatory Prepayments. If at any time (i) the sum of
Revolving Loans outstanding plus Swing Line Loans outstanding plus
Competitive Bid Loans outstanding plus the aggregate amount of LOC
Obligations outstanding exceeds the Revolving Committed Amount, (ii)
the amount of Swing Line Loans outstanding exceeds the Swing Line
Committed Amount, (iii) the amount of LOC Obligations outstanding
exceeds the LOC Committed Amount, or (iv) the amount of Revolving Loans
outstanding in Foreign Currency plus Competitive Bid Loans outstanding
in Foreign Currency exceeds the U.S. Dollar Equivalent of Fifty Million
Dollars ($50,000,000), the Borrower shall immediately make a principal
payment to the Administrative Agent in the manner and in an amount
necessary to be in compliance with Section 2.1, 2.2, 2.3 or 2.4, as
applicable.
(c) Application of Prepayments. All amounts required to be
paid pursuant to Section 3.3(b) (i) shall be applied first to Revolving
Loans (first to Base Rate Loans and then to Eurocurrency Loans in
direct order of Interest Period maturities), second to Swing Line Loans
(first to Base Rate Loans and then to Quoted Rate Swing Line Loans),
third to a cash collateral account in respect of LOC Obligations and
fourth to Competitive Bid Loans pro rata among the Lenders holding
same. All prepayments hereunder shall be subject to Section 3.14 as
well as any breakage fees in connection with a prepayment of a
Competitive Bid Loan or a Quoted Rate Swing Line Loan.
3.4 Fees.
(a) Facility Fees. In consideration of the Revolving Committed
Amount being made available by the Lenders hereunder, the Borrower
agrees to pay to the Administrative Agent, for the pro rata benefit of
each applicable Lender (based on each Lender's Revolving Loan
Commitment Percentage of the Revolving Committed Amount), a fee equal
to the Applicable Percentage for Facility Fees on the Revolving
Committed Amount (the "Facility Fees"). The accrued Facility Fees shall
commence to accrue on the Effective Date and shall be due and payable
in arrears on the first Business Day of each fiscal quarter of the
Borrower (as well as on the Revolving Loan Maturity Date and on any
date that the Revolving Committed Amount is reduced) for the
immediately preceding fiscal quarter (or portion thereof), beginning
with the first of such dates to occur after the Closing Date.
(b) Letter of Credit Fees.
(i) Letter of Credit Fee. In consideration of the issuance of
Letters of Credit hereunder, the Borrower agrees to pay to the Issuing
Lender, for the pro rata benefit of the applicable Lenders (based on
each Lender's Revolving Loan Commitment Percentage of the Revolving
Committed Amount), a fee (the "Letter of
37
Credit Fee") equal to the Applicable Percentage for the Letter
of Credit Fee on the average daily maximum amount available to
be drawn under each such Letter of Credit from the date of
issuance to the date of expiration. The Letter of Credit Fee
will be payable in arrears on the first Business Day of each
fiscal quarter of the Borrower (as well as on the Revolving
Loan Maturity Date) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such
dates to occur after the Closing Date.
(ii) Issuing Lender Fees. In addition to the
Letter of Credit Fees payable pursuant to subsection (i)
above, the Borrower shall pay to the Issuing Lender for its
own account, without sharing by the other Lenders, (A) a fee
equal to one-eighth of one percent (1/8%) per annum on the
total sum of all Letters of Credit issued by the Issuing
Lender, such fee to be paid quarterly in arrears 15 days after
the end of each fiscal quarter of the Borrower (as well as on
the Revolving Loan Maturity Date) and (B) the customary
charges from time to time to the Issuing Lender for its
services in connection with the issuance, amendment, payment,
transfer, administration, cancellation and conversion of, and
drawings under, such Letters of Credit (collectively, the
"Issuing Lender Fees").
(c) Administrative Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual fee as agreed to
between the Borrower and the Administrative Agent in the Fee Letter.
(d) Competitive Bid Request Fees. The Borrower agrees to pay
to the Administrative Agent a Competitive Bid Request Fee as agreed to
between the Borrower and the Administrative Agent as set forth in the
Fee Letter.
3.5 Payment in full at Maturity. On the Revolving Loan Maturity Date,
the entire outstanding principal balance of all Revolving Loans, all Swing Line
Loans, all Competitive Bid Loans and all LOC Obligations then outstanding,
together with accrued but unpaid interest and all other sums owing with respect
thereto, shall be due and payable in full, unless accelerated sooner pursuant to
Section 9.
3.6 Computations of Interest and Fees.
(a) Except for Base Rate Loans, in which case interest shall
be computed on the basis of a 365 or 366 day year, as applicable, all
computations of interest and fees hereunder shall be made on the basis
of the actual number of days elapsed over a year of 360 days. Interest
shall accrue from and include the date of borrowing (or continuation or
conversion) but exclude the date of payment.
(b) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Borrower are hereby limited by the provisions of this paragraph which
shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including
38
but not limited to prepayment or acceleration of the maturity of any
obligation), shall the interest taken, reserved, contracted for,
charged, or received under this Credit Agreement, under the Notes or
otherwise, exceed the maximum nonusurious amount permissible under
applicable law. If, from any possible construction of any of the Credit
Documents or any other document, interest would otherwise be payable in
excess of the maximum nonusurious amount, any such construction shall
be subject to the provisions of this paragraph and such documents shall
be automatically reduced to the maximum nonusurious amount permitted
under applicable law, without the necessity of execution of any
amendment or new document. If any Lender shall ever receive anything of
value which is characterized as interest on the Loans under applicable
law and which would, apart from this provision, be in excess of the
maximum lawful amount, an amount equal to the amount which would have
been excessive interest shall, without penalty, be applied to the
reduction of the principal amount owing on the Loans and not to the
payment of interest, or refunded to the Borrower or the other payor
thereof if and to the extent such amount which would have been
excessive exceeds such unpaid principal amount of the Loans. The right
to demand payment of the Loans or any other indebtedness evidenced by
any of the Credit Documents does not include the right to receive any
interest which has not otherwise accrued on the date of such demand,
and the Lenders do not intend to charge or receive any unearned
interest in the event of such demand. All interest paid or agreed to be
paid to the Lenders with respect to the Loans shall, to the extent
permitted by applicable law, be amortized, prorated, allocated, and
spread throughout the full stated term (including any renewal or
extension) of the Loans so that the amount of interest on account of
such indebtedness does not exceed the maximum nonusurious amount
permitted by applicable law.
3.7 Pro Rata Treatment. Except to the extent otherwise
provided herein:
(a) Loans. Each Revolving Loan borrowing (including, without
limitation, each Mandatory Borrowing), each payment or prepayment of
principal of any Revolving Loan, each payment of fees (other than the
Issuing Lender Fees retained by the Issuing Lender for its own account
and the Administrative Fees and Competitive Bid Request Fees retained
by the Administrative Agent for its own account), each reduction of the
Revolving Committed Amount, and each conversion or continuation of any
Revolving Loan, shall (except as otherwise provided in Section 3.11) be
allocated pro rata among the relevant Lenders in accordance with the
respective Revolving Loan Commitment Percentages of such Lenders (or,
if the Commitments of such Lenders have expired or been terminated, in
accordance with the respective principal amounts of the outstanding
Revolving Loans and Participation Interests of such Lenders); provided
that, if any Lender shall have failed to pay its applicable pro rata
share of any Revolving Loan, then any amount to which such Lender would
otherwise be entitled pursuant to this subsection (a) shall instead be
payable to the Administrative Agent until the share of such Revolving
Loan not funded by such Lender has been repaid; provided further, that
in the event any amount paid to any Lender pursuant to this subsection
(a) is rescinded or must otherwise be returned by the Administrative
Agent, each Lender shall, upon the request of the Administrative Agent,
repay to the Administrative Agent the amount so paid to such Lender,
with interest for the period commencing on the date such payment is
returned by the Administrative Agent until the date the Administrative
Agent receives such repayment at a rate per annum equal to, during the
period to but
39
excluding the date two Business Days after such request, the Federal
Funds Rate, and thereafter, the Base Rate plus two percent (2%) per
annum; and
(b) Letters of Credit. Each payment of unreimbursed drawings
in respect of LOC Obligations shall be allocated to each LOC
Participant pro rata in accordance with its Revolving Loan Commitment
Percentage; provided that, if any LOC Participant shall have failed to
pay its applicable pro rata share of any drawing under any Letter of
Credit, then any amount to which such LOC Participant would otherwise
be entitled pursuant to this subsection (b) shall instead be payable to
the Issuing Lender until the share of such unreimbursed drawing not
funded by such Lender has been repaid; provided further, that in the
event any amount paid to any LOC Participant pursuant to this
subsection (b) is rescinded or must otherwise be returned by the
Issuing Lender, each LOC Participant shall, upon the request of the
Issuing Lender, repay to the Administrative Agent for the account of
the Issuing Lender the amount so paid to such LOC Participant, with
interest for the period commencing on the date such payment is returned
by the Issuing Lender until the date the Issuing Lender receives such
repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal
Funds Rate, and thereafter, the Base Rate plus two percent (2%) per
annum.
3.8 Sharing of Payments. The Lenders agree among themselves that,
except to the extent otherwise provided herein, in the event that any Lender
shall obtain payment in respect of any Loan, unreimbursed drawing with respect
to any LOC Obligations or any other obligation owing to such Lender under this
Credit Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
shall promptly pay in cash or purchase from the other Lenders a participation in
such Loans, LOC Obligations, and other obligations in such amounts, and make
such other adjustments from time to time, as shall be equitable to the end that
all Lenders share such payment in accordance with their respective ratable
shares as provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such a participation may, to
the fullest extent permitted by law, exercise all rights of payment, including
setoff, banker's lien or counterclaim, with respect to such participation as
fully as if such Lender were a holder of such Loan, LOC Obligation or other
obligation in the amount of such participation. Except as otherwise expressly
provided in this Credit Agreement, if any Lender or an Agent shall fail to remit
to an Agent or any other Lender an amount payable by such Lender or such Agent
to such Agent or such other Lender pursuant to this Credit Agreement on the date
when such amount is due, such payments shall be made together with interest
thereon for each date from the date such amount is due until the date such
amount is paid to such Agent or such other Lender at a rate per annum equal to
the Federal Funds Rate. If under any applicable bankruptcy, insolvency or other
40
similar law, any Lender receives a secured claim in lieu of a setoff to which
this Section 3.8 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 under this Section 3.8 to share in the benefits of any
recovery on such secured claim.
3.9 Capital Adequacy. If, after the date hereof, any Lender has
determined that the adoption or the becoming effective of, or any change in, or
any change by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof in the interpretation
or administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Lender, or its parent corporation, with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any such authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on such Lender's (or parent
corporation's) capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender, or its parent
corporation, could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's (or parent corporation's)
policies with respect to capital adequacy), then, within 30 days following
written notice from such Lender to the Borrower (such notice setting forth the
amount necessary to compensate such Lender and identifying in reasonable detail
the basis for the calculation of such amount and taking into account applicable
deductions and credits in respect of the amount indemnified), the Borrower shall
be obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender on an after-tax basis (after taking into account
applicable deductions and credits in respect of the amount indemnified) for such
reduction. Each determination by any such Lender of amounts owing under this
Section shall, absent manifest error, be conclusive and binding on the parties
hereto. This covenant shall survive the termination of this Credit Agreement and
the payment of the Loans and all other amounts payable hereunder. Each Lender
agrees not to give any such notice or demand any such payment with respect to
any such determinations at a time more than six months after the period as to
which the Lender has made such determinations. The Borrower shall not be
obligated to compensate any Lender for any such reductions if the Borrower shall
have received such demand from such Lender later than the time provided in the
preceding sentence. Each Lender agrees to make all reasonable efforts to avoid
or minimize the amount of any demand for payment under this Section 3.9,
including exercising all reasonable efforts to change its lending office or to
transfer its affected Loans to an Affiliate; provided, however, that no Lender
shall be required by this sentence to effect any change or transfer which would
have a materially adverse effect on such Lender's results of operations or
financial condition. Notwithstanding the foregoing, no Lender shall be entitled
to request compensation under this Section 3.9 with respect to any Eurocurrency
Competitive Loan if said Lender shall have been aware of the charge giving rise
to such request at the time of submission of the related Eurocurrency
Competitive Loan.
3.10 Inability To Determine Eurocurrency Rate or Make Loans in Foreign
Currency. If the Administrative Agent shall have determined in good faith (which
determination shall be conclusive and binding upon the Borrower) that, (a) by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurocurrency Rate or (b) Loans cannot be
made in a Foreign Currency, the Administrative Agent shall give telecopy or
telephonic notice thereof to the Borrower and the Lenders as soon as practicable
thereafter, and
41
will also give prompt written notice to the Borrower when such conditions no
longer exist. If such notice is given in connection with (a) above (i) any
Eurocurrency Loans requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans, (ii) any Loans that were to have been
converted on the first day of such Interest Period to or continued as
Eurocurrency Loans shall be converted to or continued as Base Rate Loans and
(iii) any outstanding Eurocurrency Loans shall be converted, on the first day of
such Interest Period, to Base Rate Loans. Until such notice has been withdrawn
by the Administrative Agent, no further Eurocurrency Loans shall be made or
continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurocurrency Loans. If such notice is given in connection with (b)
above, any request for a Loan in such Foreign Currency shall be a request for
such loan to be made in Dollars.
3.11 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof occurring after the Closing Date shall make it unlawful for
any Lender to make or maintain Eurocurrency Loans as contemplated by this Credit
Agreement, (a) such Lender shall promptly give written notice of such
circumstances to the Borrower and the Administrative Agent (which notice shall
be withdrawn whenever such circumstances no longer exist), (b) the commitment of
such Lender hereunder to make Eurocurrency Loans, continue Eurocurrency Loans as
such and convert a Base Rate Loan to Eurocurrency Loans shall forthwith be
canceled and, until such time as it shall no longer be unlawful for such Lender
to make or maintain Eurocurrency Loans, such Lender shall then have a commitment
only to make a Base Rate Loan when a Eurocurrency Loan is requested and (c) such
Lender's Loans then outstanding as Eurocurrency Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days or the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurocurrency Loan occurs
on a day which is not the last day of the then current Interest Period with
respect thereto, the Borrower shall pay to such Lender such amounts, if any, as
may be required pursuant to Section 3.14.
3.12 Requirements of Law. If, after the Closing Date, the adoption of
or any change in any Requirement of Law or in the interpretation or application
thereof applicable to any Lender, or compliance by any Lender with any request
or directive (whether or not having the force of law) from any central bank or
other Governmental Authority, in each case made subsequent to the Closing Date
(or, if later, the date on which such Lender becomes a Lender):
(a) shall change the basis of taxation of payments to such
Lender of the principal of or interest on any Loan made by such Lender
or any fees or other amounts payable to such Lender hereunder (except
for Non-Excluded Taxes covered by Section 3.13 (including Non- Excluded
Taxes imposed solely by reason of any failure of such Lender to comply
with its obligations under Section 3.13(b)) and changes in taxes
measured by or imposed upon the overall net income, or franchise tax,
gross receipt taxes, branch taxes, taxes on doing business or taxes on
the overall net worth of such Lender or its applicable lending office,
branch, or any affiliate thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
42
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurocurrency Rate
hereunder; or
(c) shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender reasonably deems to be material, of making,
converting into, continuing or maintaining Eurocurrency Loans or issuing or
participating in Letters of Credit or making Loans in a Foreign Currency or to
reduce any amount receivable hereunder in respect thereof, then, in any such
case, upon notice to the Borrower from such Lender, through the Administrative
Agent, in accordance herewith, the Borrower shall be obligated to promptly pay
such Lender, upon its demand, any additional amounts necessary to compensate
such Lender on an after-tax basis (after taking into account applicable
deductions and credits in respect of the amount indemnified) for such increased
cost or reduced amount receivable, provided that, in any such case, the Borrower
may elect to convert the Eurocurrency Loans made by such Lender hereunder to
Base Rate Loans by giving the Administrative Agent at least one Business Day's
notice of such election, in which case the Borrower shall promptly pay to such
Lender, upon demand, without duplication, such amounts, if any, as may be
required pursuant to Section 3.14. If any Lender becomes entitled to claim any
additional amounts pursuant to this Section 3.12, it shall provide prompt notice
thereof to the Borrower, through the Administrative Agent, certifying (x) that
one of the events described in this Section 3.12 has occurred and describing in
reasonable detail the nature of such event, (y) as to the increased cost or
reduced amount resulting from such event and (z) as to the additional amount
demanded by such Lender and a reasonably detailed explanation of the calculation
thereof. Such a certificate as to any additional amounts payable pursuant to
this Section 3.12 submitted by such Lender, through the Administrative Agent, to
the Borrower shall be conclusive and binding on the parties hereto in the
absence of manifest error. This covenant shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder. Notwithstanding the foregoing, no Lender shall be entitled to request
compensation under this Section 3.12 with respect to any Eurocurrency
Competitive Loan if said Lender shall have been aware of the charge giving rise
to such request at the time of submission of the related Eurocurrency
Competitive Loan.
3.13 Taxes.
(a) Except as provided below in this Section 3.13, all
payments made by the Borrower under this Credit Agreement and any Notes
shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any court, or governmental body, agency or other official,
excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or affiliate
thereof, and all franchise taxes, gross receipts, branch taxes, taxes
on doing business or taxes on the overall capital or net worth of any
Lender or its applicable lending office, or any branch or affiliate
thereof, in each case imposed: (i) by the jurisdiction under the laws
of which such Lender, applicable lending office, branch or affiliate is
organized or is located, or in which its principal executive or
business office is located, or any nation within which such
43
jurisdiction is located or any political subdivision thereof; or (ii)
by reason of any connection between the jurisdiction imposing such tax
and such Lender, applicable lending office, principal executive or
business office branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its
obligations, or received payment under or enforced, this Credit
Agreement or any Notes. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts
payable to an Agent or any Lender hereunder or under any Notes, (A) the
amounts so payable to an Agent or such Lender shall be increased to the
extent necessary to yield to an Agent or such Lender (after payment of
all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Credit
Agreement and any Notes, provided, however, that the Borrower shall be
entitled to deduct and withhold any Non-Excluded Taxes (and other
applicable taxes) and shall not be required to increase any such
amounts payable to any Lender that is not organized under the laws of
the United States of America or a state thereof if such Lender fails to
comply with the requirements of paragraph (b) (or (h)) of this Section
3.13 whenever any Non-Excluded Taxes (or other applicable taxes) are
payable by or otherwise imposed on or collected from the Borrower, and
(B) as promptly as possible after requested the Borrower shall send to
such Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt
received by the Borrower or, if none is available, other written
evidence showing payment thereof. If the Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or
fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Agents and any Lender for any incremental taxes, interest or penalties
that may become payable by an Agent or any Lender as a result of any
such failure. The agreements in this subsection shall survive the
termination of this Credit Agreement and the payment of the Loans and
all other amounts payable hereunder.
(b) Each Person which is a Lender that is not incorporated
under the laws of the United States of America or any state or
jurisdiction thereof shall:
(i) (A) on or before the date on which such Person
becomes a Lender hereunder, deliver to the Borrower and the
Administrative Agent (x) two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, or
successor applicable form, as the case may be, certifying that
it is entitled to receive payments under this Credit Agreement
and any Notes without deduction or withholding of any United
States federal income taxes and (y) an Internal Revenue
Service Form W-8 or W-9, or successor applicable form, as the
case may be, certifying that it is entitled to an exemption
from United States backup withholding tax;
(B) deliver to the Borrower and the
Administrative Agent two further copies of any such form or
certification on or before the date that any such form or
certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent
form previously delivered by it to the Borrower; and
44
(C) obtain such extensions of time for
filing and complete such forms or certifications as may
reasonably be requested by the Borrower or the Administrative
Agent; or
(ii) in the case of any such Person that is not
a "bank" within the meaning of Section 881(c)(3)(A) of the
Internal Revenue Code, on or before the date such Person
becomes a Lender hereunder, (A) represent in writing to the
Borrower (for the benefit of the Borrower and the Agents) that
it is not a bank within the meaning of Section 881(c)(3)(A) of
the Internal Revenue Code, (B) deliver to the Borrower, with a
copy to the Administrative Agent, two accurate and complete
original signed copies of Internal Revenue Service Form W-8,
or successor applicable form certifying to such Lender's legal
entitlement at the date of such certificate to an exemption
from U.S. withholding tax under the provisions of Section
881(c) of the Internal Revenue Code with respect to payments
to be made under this Credit Agreement and any Notes (and to
deliver to the Borrower and the Administrative Agent two
further copies of such form on or before the date it expires
or becomes obsolete and after the occurrence of any event
requiring a change in the most recently provided form and, if
necessary, obtain any extensions of time reasonably requested
by the Borrower or the Administrative Agent for filing and
completing such forms), and (C) agree, to the extent legally
entitled to do so, upon reasonable request by the Borrower, to
provide to the Borrower (for the benefit of the Borrower and
the Agents) such other forms as may be reasonably required in
order to establish the legal entitlement of such Lender to an
exemption from withholding with respect to payments under this
Credit Agreement and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation
has occurred after the date such Person becomes a Lender hereunder
which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form or reasonable
substitution therefor with respect to it and such Lender so advises the
Borrower and the Administrative Agent then such Lender shall be exempt
from such requirements. Each Person that shall become a Lender or a
participant of a Lender pursuant to Section 11.3 shall, upon the
effectiveness of the related transfer, be required to provide all of
the forms, certifications and statements required pursuant to this
subsection (b); provided that in the case of a participant of a Lender,
the obligations of such participant of a Lender pursuant to this
subsection (b) shall be determined as if the participant of a Lender
were a Lender except that such participant of a Lender shall furnish
all such required forms, certifications and statements to the Lender
from which the related participation shall have been purchased and such
Lender shall provide copies to the Administrative Agent and the
Borrower.
(c) Notwithstanding anything to the contrary in this Credit
Agreement, the Borrower shall not be required to pay any current or
future stamp, intangible or documentary taxes or any other excise or
property taxes, charges or similar levies (including without
limitation, mortgage recording taxes and similar fees) that arise as a
result of sales, assignments or other transfers of rights hereunder by
any Lender.
45
(d) If requested by a Borrower, and at the Borrower's expense,
any Lender and the Administrative Agent shall take such steps as may be
appropriate to seek a refund of any Non-Excluded Taxes paid by it and
shall permit the Borrower to participate in the preparation of any such
refund claim. If any Lender or the Administrative Agent receives a
refund in respect of any Non-Excluded Taxes for which the Lender has
received payment from the Borrower hereunder, any Lender and the
Administrative Agent, within 15 days of such receipt, shall deliver to
the Borrower the amount of such refund. In addition, within 15 days of
a written request of a Borrower, any Lender and the Administrative
Agent shall execute and deliver to the Borrower such certificates,
forms or other documents which can be reasonably furnished consistent
with the facts and which are reasonably necessary to assist the
Borrower in applying for refunds of Non-Excluded Taxes remitted
hereunder.
(e) If a Borrower is required to pay any amounts pursuant to
the provisions of this Section 3.13, and if thereafter any Lender or
the Administrative Agent shall receive or be granted a credit against
or remission or other relief for any Non-Excluded Taxes payable by the
Borrower solely in respect of the amounts so paid by the Borrower, such
Lender shall to the extent that it can do so without prejudice to the
retention of the amount of such credit, remission or other relief, pay
to the Borrower promptly after the date on which any Lender or the
Administrative Agent effectively obtains the benefit of such credit,
remission or other relief an amount which such Lender reasonably
determines to be equal to such credit, remission or other relief less
any sum which the Lender is required by law to deduct therefrom. The
Lender may, in its reasonable discretion, determine the order of
utilization of all charges, deductions, credits and expenses.
(f) In the event any Lender or the Administrative Agent
receives written communication from any tax authority with respect to
an assessment or proposed assessment of any Non-Excluded Taxes, such
Lender or the Administrative Agent shall promptly notify the Borrower
in writing and provide a copy of such communication to the Borrower.
(g) Each Lender shall use reasonable efforts to avoid or
minimize any amounts which might otherwise be payable pursuant to this
Section 3.13, including, upon request of a Borrower, the change of its
lending office; provided, however, that such efforts shall not include
the taking of any actions by the Lender that would result in any tax,
costs or other expense to the Lender (other than a tax, cost or expense
for which the Lender shall have been reimbursed or indemnified by the
Borrower pursuant to this Credit Agreement or otherwise) or any action
which would have a materially adverse effect on such Lenders results of
operations or financial condition.
(h) Each Person which is a Lender that is incorporated under
the laws of the United States of America or a state thereof shall, on
or before the date such Person becomes a Lender hereunder, deliver to
the Borrower and the Administrative Agent an Internal Revenue Service
Form W-9, or successor applicable form, certifying that it is entitled
to an exemption from United States backup withholding tax.
3.14 Compensation. The Borrower promises to indemnify each
Lender and to hold each Lender harmless from any loss or expense which
such Lender may sustain or incur as a consequence
46
of (a) default by the Borrower in making a borrowing of, conversion into or
continuation of Eurocurrency Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurocurrency Loan
after the Borrower has given a notice thereof in accordance with the provisions
of this Credit Agreement and (c) the making of a prepayment of Eurocurrency
Loans on a day which is not the last day of an Interest Period with respect
thereto. Such indemnification may include an amount equal to (i) the amount of
interest which would have accrued on the amount so prepaid, or not so borrowed,
converted or continued, for the period from the date of such prepayment or of
such failure to borrow, convert or continue to the last day of the applicable
Interest Period (or, in the case of a failure to borrow, convert or continue,
the Interest Period that would have commenced on the date of such failure) in
each case at the applicable rate of interest for such Eurocurrency Loans
provided for herein (excluding, however, the Applicable Percentage included
therein, if any) minus (ii) the amount of interest (as reasonably determined by
such Lender) which would have accrued to such Lender on such amount by placing
such amount on deposit for a comparable period with leading banks in the
interbank Eurocurrency market. The agreements in this Section shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
SECTION 4
GUARANTY
4.1 Guaranty of Payment. Subject to Section 4.7 below, each of the
Guarantors hereby, jointly and severally, unconditionally guarantees to each
Lender and the Agents the prompt payment of the Borrower Obligations in full
when due (whether at stated maturity, as a mandatory prepayment, by acceleration
or otherwise). This Guaranty is a guaranty of payment and not of collection and
is a continuing guaranty and shall apply to all Borrower Obligations whenever
arising.
4.2 Obligations Unconditional. The obligations of the Guarantors
hereunder are absolute and unconditional, irrespective of the value,
genuineness, validity, regularity or enforceability of any of the Credit
Documents or any other agreement or instrument referred to therein, to the
fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor. Each Guarantor agrees that this
Guaranty may be enforced by the Lenders without the necessity at any time of
resorting to or exhausting any other security or collateral and without the
necessity at any time of having recourse to the Notes or any other of the Credit
Documents or any collateral, if any, hereafter securing the Borrower Obligations
or otherwise and each Guarantor hereby waives the right to require the Lenders
to proceed against the Borrower or any other Person (including a co-guarantor)
or to require the Lenders to pursue any other remedy or enforce any other right.
Each Guarantor further agrees that any right of subrogation, indemnity,
reimbursement or contribution it may have against the Borrower or any other
Guarantor of the Borrower Obligations for amounts paid under this Guaranty shall
be subordinated to (and no Guarantor shall assert same unless and until) the
repayment in full of all Loans, all reimbursement obligations under Letters of
Credit, all interest thereon, and all fees until 100 days after the date on
which all Commitments and Letters of Credit have been terminated and all Loans,
LOC Obligations, interest, and fees have been paid in full. Each
47
Guarantor further agrees that nothing contained herein shall prevent the Lenders
from suing on the Notes or any of the other Credit Documents or foreclosing its
security interest in or Lien on any collateral, if any, securing the Borrower
Obligations or from exercising any other rights available to it under this
Credit Agreement, the Notes, any other of the Credit Documents, or any other
instrument of security, if any, and the exercise of any of the aforesaid rights
and the completion of any foreclosure proceedings shall not constitute a
discharge of any Guarantor's obligations hereunder; it being the purpose and
intent of each Guarantor that its obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances. Neither any
Guarantor's obligations under this Guaranty nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release or limitation of the
liability of the Borrower or by reason of the bankruptcy or insolvency of the
Borrower. Each Guarantor waives any and all notice of the creation, renewal,
extension or accrual of any of the Borrower Obligations and notice of or proof
of reliance of by any Agent or any Lender upon this Guarantee or acceptance of
this Guarantee. The Borrower Obligations, and any of them, shall conclusively be
deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon this Guarantee. All dealings between the
Borrower and any of the Guarantors, on the one hand, and the Agents and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been
had or consummated in reliance upon this Guarantee.
4.3 Modifications. Each Guarantor agrees that (a) all or any part of
the security now or hereafter held for the Borrower Obligations, if any, may be
exchanged, compromised or surrendered from time to time; (b) the Lenders shall
not have any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Borrower
Obligations or the properties subject thereto; (c) the time or place of payment
of the Borrower Obligations may be changed or extended, in whole or in part, to
a time certain or otherwise, and may be renewed or accelerated, in whole or in
part; (d) the Borrower and any other party liable for payment under the Credit
Documents may be granted indulgences generally or be released; (e) any of the
provisions of the Notes or any of the other Credit Documents may be modified,
amended or waived in accordance with Section 11.6; and (f) any deposit balance
for the credit of the Borrower or any other party liable for the payment of the
Borrower Obligations or liable upon any security therefor may be released, in
whole or in part, at, before or after the stated, extended or accelerated
maturity of the Borrower Obligations, all without notice to or further assent by
such Guarantor, which shall remain bound thereon, notwithstanding any such
exchange, compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.
4.4 Waiver of Rights. Each Guarantor expressly waives to the fullest
extent permitted by applicable law: (a) notice of acceptance of this Guaranty by
the Lenders and of all extensions of credit to the Borrower by the Lenders; (b)
presentment and demand for payment or performance of any of the Borrower
Obligations; (c) protest and notice of dishonor or of default (except as
specifically required in the Credit Agreement) with respect to the Borrower
Obligations or with respect to any security therefor; (d) notice of the Lenders
obtaining, amending, substituting for, releasing, waiving or modifying any
security interest, lien or encumbrance, if any, hereafter securing the Borrower
Obligations, or the Lenders' subordinating, compromising, discharging or
releasing such security interests, liens or encumbrances, if any; (e) all other
notices to which such Guarantor might otherwise be entitled; and (f) demand for
payment under this Guaranty.
48
4.5 Reinstatement. The obligations of the Guarantors under this Section
4 shall be automatically reinstated if and to the extent that, on or before 100
days following the date on which all Commitments and Letters of Credit have been
terminated, and all Loans, LOC Obligations, interest and fees have been paid,
for any reason any payment by or on behalf of any Person in respect of the
Credit Party Obligations is rescinded or must be otherwise restored by any
holder of any of the Credit Party Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and each Guarantor
agrees that it will indemnify the Agents and each Lender on demand for all
reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) incurred by an Agent or such Lender in connection with such rescission
or restoration, including any such costs and expenses incurred in defending
against any claim alleging that such payment constituted a preference,
fraudulent transfer or similar payment under any bankruptcy, insolvency or
similar law.
4.6 Remedies. The Guarantors agree that, as between the Guarantors, on
the one hand, and the Agents and the Lenders, on the other hand, the Credit
Party Obligations may be declared to be forthwith due and payable as provided in
Section 9 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person (including any other Guarantor) and that, in the event of such
declaration (or such Credit Party Obligations being deemed to have become
automatically due and payable), such Credit Party Obligations (whether or not
due and payable by any other Person) shall forthwith become due and payable by
the Guarantors.
4.7 Limitation of Guaranty.
(a) Each Guarantor and by its acceptance of hereof, the Agents
and each other Lender, hereby confirms that it is the intention of all
such parties that this Section 4 not constitute a fraudulent transfer
or conveyance for purposes of the Bankruptcy Code, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar federal or state law to the extent applicable to this Section
4. To effectuate the foregoing intention, the Agents, the other Lenders
and the Guarantors hereby irrevocably agree that the obligations of
each Guarantor and such Guarantor's Subsidiaries under this Section 4
and, without duplication, under any Collateral Document and any other
Credit Document to which such Guarantor is a party, shall not, in the
aggregate, exceed the greater of (i) the net benefit realized by such
Guarantor or any such Subsidiary from the proceeds of the Loans made
from time to time by the Borrower to the Guarantor or any Subsidiary of
the Guarantor and (ii) 95% of the Adjusted Net Assets of such Guarantor
from time to time following the Closing Date (or, if such Guarantor has
executed and delivered a Joinder Agreement, the date of execution of
such Joinder Agreement). "Adjusted Net Assets" of any Guarantor with
respect to any payment by such Guarantor at any date means the lesser
of (x) the amount by which the fair value of the property of the
Guarantor at such date (including, without limitation, goodwill and the
rights and property of such Guarantor incurred pursuant to Section 4.8
in conjunction with prior payments under this Section 4) exceeds the
total amount of liabilities (including, without limitation, contingent
liabilities and, in conjunction with prior payments made under this
Section 4, liabilities incurred by such Guarantor
49
pursuant to Section 4.8, but excluding all other liabilities under this
Section 4) of the Guarantor at such date and (y) the amount by which
the present fair salable value of the assets of the Guarantor at such
date (including, without limitation, goodwill and the rights and
property of such Guarantor incurred pursuant to Section 4.8 in
conjunction with prior payments under this Section 4) exceeds the
amount that will be required to pay the probable liability of the
Guarantor on its debts (including liabilities incurred by such
Guarantor pursuant to Section 4.8 in conjunction with prior payments
under this Section 4 but excluding all other debt in respect of this
Section 4), as they become absolute and matured.
(b) Notwithstanding any provision to the contrary contained
herein or in any of the other Credit Documents, to the extent the
obligations of any Guarantor shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of
any applicable state or federal law relating to fraudulent conveyances
or transfers) then the obligations of such Guarantor hereunder shall be
limited to the maximum amount that is permissible under applicable law
(whether federal or state and including, without limitation, the
Bankruptcy Code).
4.8 Rights of Contribution. The Guarantors hereby agree, as among
themselves, that if any Guarantor shall become an Excess Funding Guarantor (as
defined below), each other Guarantor shall, on demand of such Excess Funding
Guarantor (but subject to the next sentence hereof), pay to such Excess Funding
Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined below
and determined, for this purpose, without reference to the properties, assets,
liabilities and debts of such Excess Funding Guarantor) of such Excess Payment
(as defined below). The payment obligation of any Guarantor to any Excess
Funding Guarantor under this Section 4.8 shall be subordinate and subject in
right of payment to the prior payment in full of the obligations of such
Guarantor to the extent and until such time as set forth in the third sentence
of Section 4.2, and until such time such Excess Funding Guarantor shall not
exercise any right or remedy with respect to such excess. For purposes hereof,
(i) "Excess Funding Guarantor" shall mean, in respect of any obligations arising
under the other provisions of this Section 4 (hereafter, the "Guaranteed
Obligations"), a Guarantor that has made an Excess Payment; (ii) "Excess
Payment" shall mean, in respect of any Guaranteed Obligations, the amount paid
by a Guarantor in excess of the sum of (A) the lesser of its Pro Rata Share of
such Guaranteed Obligations and the maximum amount that such Guarantor is
required to pay in respect of such obligations pursuant to Section 4.7; and (B)
the aggregate amount of payments made by Borrower to such Guarantor in respect
of such Guaranteed Obligations in accordance with the third sentence of Section
4.2 and (iii) "Pro Rata Share", in respect of any determination for the purposes
of this Section 4.8, shall mean, for any Guarantor, the ratio (expressed as a
percentage) of (a) the amount by which the aggregate present fair saleable value
of all of its assets and properties exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (b) the amount by which the aggregate present fair saleable value
of all assets and other properties of the Borrower and all of the Guarantors
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of the Borrower and the Guarantors hereunder) of the Borrower and
all of the Guarantors, all as of the time of such determination.
50
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions. The obligation of the Lenders to enter into
this Credit Agreement and make the initial Extension of Credit is subject to
satisfaction of the following conditions:
(a) Executed Credit Documents. Receipt by the Agents of duly
executed copies of each of the following required to be effective on
the Effective Date: (i) this Credit Agreement; (ii) the Notes, (iii)
the Collateral Documents and (iv) all other Credit Documents, each in
form and substance reasonably acceptable to the Agents in their sole
discretion.
(b) Corporate and Partnership Documents. Receipt by the Agents
of the following:
(i) Charter Documents. Either (A) copies of
the articles or certificates of incorporation or other charter
documents of each Credit Party that is a corporation certified
to be true and complete as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
its incorporation and certified by a secretary or assistant
secretary of such Credit Party to be true and correct as of
the Effective Date or (B) a copy of the partnership agreement
of each Credit Party that is a partnership certified by its
general partner to be true and correct.
(ii) Bylaws. A copy of the bylaws of each
Credit Party that is a corporation certified by a secretary or
assistant secretary of such Credit Party to be true and
correct as of the Effective Date.
(iii) Resolutions. Copies of resolutions of the
Board of Directors of each Credit Party (or its general
partner, as applicable) approving and adopting such Credit
Documents to which it is a party, the transactions
contemplated therein and authorizing execution and delivery
thereof, certified by a secretary or assistant secretary of
such Credit Party (or its general partner, as applicable) to
be true and correct and in force and effect as of the
Effective Date.
(iv) Good Standing. Copies of (A) certificates
of good standing, existence or its equivalent, as applicable,
with respect to each Credit Party (and its general partner, as
applicable) certified as of a recent date by the appropriate
Governmental Authorities of the state or other jurisdiction of
incorporation and each other jurisdiction in which the failure
to so qualify and be in good standing would have a Material
Adverse Effect on the business or operations of a Credit Party
in such jurisdiction and (B) to the extent available, a
certificate indicating payment of all corporate franchise
taxes certified as of a recent date by the appropriate
governmental taxing authorities.
51
(v) Incumbency. An incumbency certificate of
each Credit Party (or its general partner, as applicable)
certified by a secretary or assistant secretary to be true and
correct as of the Effective Date.
(c) Financial Statements. Receipt by the Agents of (i) the
consolidated financial statements of the Credit Parties for fiscal
years 1994 and 1995, including balance sheets and income and cash flow
statements audited by an independent public accounting firm acceptable
to the Agents and containing an unqualified opinion of such firm that
such statements present fairly, in all material respects, the
consolidated financial condition and results of operations of the
Credit Parties, and are prepared in conformity with GAAP, and (ii) pro
forma financial statements for the immediate succeeding five fiscal
years.
(d) Opinion of Counsel. Receipt by the Agents of an opinion,
or opinions (which shall cover, among other things, authority,
legality, validity, binding effect and enforceability), reasonably
satisfactory to the Agents, addressed to the Agents on behalf of the
Lenders and dated as of the Effective Date, from legal counsel to the
Credit Parties.
(e) Spin-Off. The Agents shall have received in connection
with the spin-off of the Borrower from Corning Clinical Laboratories
Inc., a Delaware corporation (the "Spin- Off") a copy of the IRS
Private Letter Ruling issued to Corning Incorporated addressing the tax
treatment of the Spin-Off.
(f) Consents and Approvals. The Borrower shall receive all
governmental, shareholder and third party consents and approvals
necessary in connection with the Spin- Off.
(g) Expiration of Waiting Periods. The Borrower and its
Subsidiaries shall confirm the expiration of all applicable waiting
periods, without any action being taken by any authority (i) in
connection with the Spin-Off, and (ii) to the extent it would restrain,
prevent or impose any material adverse conditions on the Borrower or
any of its Subsidiaries.
(h) Due Diligence. The completion of all due diligence with
respect to the Credit Parties and their Subsidiaries in scope and
determination satisfactory to the Agents in their reasonable
discretion, including, without limitation, historical financial
information, litigation, tax, accounting, labor, insurance, pension
liabilities (actual or contingent) real estate leases, material
contracts, debt agreements, property ownership and contingent
liabilities.
(i) Liens. The Agents shall have received evidence
satisfactory to the Agents that no Liens are in effect except for
Permitted Liens.
(j) Evidence of Insurance. Receipt by the Agents of copies of
insurance policies or certificates of insurance of the Credit Parties
evidencing liability and casualty insurance meeting the requirements
set forth in the Credit Documents.
52
(k) Material Adverse Effect. There shall not have occurred a
change since December 31, 1995 that has had or could reasonably be
expected to have a Material Adverse Effect.
(l) Litigation. Except as disclosed on Schedule 6.11, there
shall not exist any pending or threatened action, suit, investigation
or proceeding pending or threatened in any court or before any
arbitrator or governmental authority against a Credit Party or any of
their Subsidiaries that would have or would reasonably be expected to
have a Material Adverse Effect.
(m) Officer's Certificates. The Agents shall have received a
certificate or certificates executed by the chief financial officer of
the Borrower on behalf of the Borrower as of the Effective Date stating
that (i) the Borrower and each of the Borrower's Subsidiaries are in
compliance with all existing material financial obligations, (ii) no
action, suit, investigation or proceeding is pending or threatened in
any court or before any arbitrator or governmental instrumentality that
purports to effect the Borrower, any of the Borrower's Subsidiaries or
any transaction contemplated by the Credit Documents, if such action,
suit, investigation or proceeding would have or would be reasonably
expected to have a Material Adverse Effect, (iii) the financial
statements and information delivered pursuant to Section 5.1(c) were
prepared in good faith and using reasonable assumptions and (iv)
immediately after giving effect to this Credit Agreement, the other
Credit Documents and all the transactions contemplated therein to occur
on such date, (A) each Credit Party is Solvent, (B) no Default or Event
of Default has occurred and is continuing, (C) all representations and
warranties contained herein and in the other Credit Documents are true
and correct in all material respects, and (D) the Borrower is in
compliance with each of the financial covenants set forth in Section
7.2.
(n) Existing Financial Obligations. The Borrower and its
Subsidiaries shall be in compliance with all existing financial
obligations in all material respects.
(o) Disruption of Financial Markets. The absence of any
disruption or adverse change in the financial or capital markets
generally which the Agents, in their sole discretion, deem material in
connection with the syndication of the credit facility evidenced by
this Credit Agreement.
(p) Fees and Expenses. Payment by the Credit Parties of all
fees and expenses owed by them to the Lenders and the Agents,
including, without limitation, payment to the Agents of the fees set
forth in the Fee Letter.
(q) Collateral. Receipt by the Administrative Agent of (i) all
stock certificates or other instruments evidencing the Voting Stock
pledged pursuant to a Pledge Agreement, together with duly executed in
blank stock powers attached thereto and (ii) all promissory notes
evidencing loans from Credit Parties to Non-Material Domestic
Subsidiaries together with duly executed endorsements attached thereto.
53
(r) Other. Receipt by the Agents of such other documents,
instruments, agreements or information as reasonably and timely
requested by an Agent.
5.2 Conditions to All Extensions of Credit. In addition to the
conditions precedent stated elsewhere herein, the Lenders shall not be obligated
to make, continue or convert Loans nor shall the Issuing Lender be required to
issue or extend a Letter of Credit unless:
(a) Notice. The Borrower shall have delivered (i) in the case
of any new Revolving Loan, a Notice of Borrowing, duly executed and
completed, by the time specified in Section 2.1, (ii) in the case of
any Letter of Credit, the Issuing Lender shall have received an
appropriate request for issuance in accordance with the provisions of
Section 2.2, (iii) in the case of any Swing Line Loan, a Swing Line
Loan Request, duly executed and completed, by the time specified in
Section 2.4, (iv) in the case of any Competitive Bid Loans, a
Competitive Bid Loan Request, duly executed and completed, by the time
specified in Section 2.3 and (v) in the case of any continuation or
conversion of an existing Loan, a Notice of Continuation/Conversion by
the time specified in Section 2.1(e);
(b) Representations and Warranties. If the Borrower is
requesting (i) a new Loan (as opposed to a continuation or conversion
of an existing Loan) or (ii) the issuance of a Letter of Credit, the
representations and warranties made in the Credit Documents are true
and correct in all material respects at and as if made as of such date
except to the extent they expressly relate to an earlier date;
(c) No Default. No Default or Event of Default shall exist or
be continuing either prior to or after giving effect thereto;
(d) Availability. Immediately after giving effect to the
making of a Revolving Loan (and the application of the proceeds
thereof) or to the issuance of a Letter of Credit, as the case may be,
the sum of the Revolving Loans outstanding plus LOC Obligations
outstanding plus Swing Line Loans outstanding plus Competitive Bid
Loans outstanding shall not exceed the Revolving Committed Amount.
The delivery of each Notice of Borrowing and each request for a Letter of Credit
shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c) and (d) above and
the delivery of each Notice of Continuation/Conversion shall constitute a
representation and warranty by the Borrower of the correctness of the matters
specified in subsections (c) and (d) above.
54
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Agents and each Lender that:
6.1 Financial Condition. The financial statements delivered to the
Lenders pursuant to Section 5.1(c)(i) and Section 7.1(a) and (b): (a) have been
prepared in accordance with GAAP and (b) present fairly the consolidated
financial condition, results of operations and cash flows of the Credit Parties
and their Subsidiaries as of such date and for such periods.
6.2 No Material Change. Except as set forth on Schedule 6.2, since
December 31, 1995, there has been no development or event relating to or
affecting a Credit Party or any of their Subsidiaries which has had or would be
reasonably expected to have a Material Adverse Effect.
6.3 Organization and Good Standing. Each Credit Party and each of its
Material Subsidiaries (a) is either a corporation duly incorporated or a
partnership duly formed, validly existing and in good standing under the laws of
the State (or other jurisdiction) of its incorporation or formation, as the case
may be, (b) is duly qualified and in good standing as a foreign corporation or
foreign partnership and is authorized to do business in every jurisdiction where
it does business unless the failure to be so qualified, in good standing or
authorized would not have or would not be reasonably expected to have a Material
Adverse Effect and (c) has the requisite corporate or partnership power and
authority to own its properties and to carry on its business as now conducted
and as proposed to be conducted.
6.4 Due Authorization. Each Credit Party (a) has the requisite
corporate or partnership power and authority to execute, deliver and perform
this Credit Agreement and the other Credit Documents to which it is a party and
to incur the obligations herein and therein provided for and (b) is duly
authorized to, and has been authorized by all necessary corporate or partnership
action, to execute, deliver and perform this Credit Agreement and the other
Credit Documents to which it is a party.
6.5 No Conflicts. Neither the execution and delivery of the Credit
Documents, nor the consummation of the transactions contemplated therein, nor
performance of and compliance with the terms and provisions thereof by such
Credit Party will (a) violate or conflict with any provision of its articles or
certificate of incorporation or bylaws, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation (including,
without limitation, Regulation U or Regulation X), order, writ, judgment,
injunction, decree or permit applicable to it, if the result thereof could cause
or be reasonably expected to cause a Material Adverse Effect, (c) violate,
contravene or conflict with contractual provisions of, or cause an event of
default under, any indenture, loan agreement, mortgage, deed of trust, contract
or other agreement or instrument to which it is a party or by which it may be
bound, if the result thereof could cause or be reasonably expected to cause a
Material Adverse Effect, or (d) result in or require the creation of any Lien
upon or with respect to its properties.
55
6.6 Consents. Except for consents, approvals and authorizations which
have been obtained, no consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party in respect of any Credit Party is required in connection with the
execution, delivery or performance of this Credit Agreement or any of the other
Credit Documents by such Credit Party.
6.7 Enforceable Obligations. This Credit Agreement and the other Credit
Documents have been duly executed and delivered and constitute legal, valid and
binding obligations of each Credit Party thereto enforceable against such Credit
Party in accordance with their respective terms, except as may be limited by
bankruptcy or insolvency laws or similar laws affecting creditors' rights
generally or by general equitable principles.
6.8 No Default. No Credit Party, nor any of its Subsidiaries, is in
default under any contract, lease, loan agreement, indenture, mortgage, security
agreement or other agreement or obligation to which it is a party or by which
any of its properties is bound which default would have or would be reasonably
expected to have a Material Adverse Effect.
6.9 Liens. None of the assets of the Credit Parties, nor any of their
Subsidiaries, is subject to any Lien other than Permitted Liens.
6.10 Indebtedness. As of the Closing Date, the Credit Parties have no
Indebtedness except (a) as disclosed in the financial statements referenced in
Section 6.1, (b) as set forth on Schedule 6.10 and (c) as otherwise permitted by
this Credit Agreement.
6.11 Litigation. Except as set forth on Schedule 6.11, there are no
actions, suits or legal, equitable, arbitration or administrative proceedings,
pending or, to the knowledge of any Credit Party, threatened against, the
Borrower or any of its Subsidiaries which could have or might be reasonably
expected to have a Material Adverse Effect.
6.12 Taxes. Except as set forth on Schedule 6.12, each Credit Party,
and each of its Subsidiaries, has filed, or caused to be filed, all tax returns
(federal, state, local and foreign) required to be filed and paid (a) all
amounts of taxes shown thereon to be due (including interest and penalties) and
(b) all other taxes, fees, assessments and other governmental charges (including
mortgage recording taxes, documentary stamp taxes and intangibles taxes) owing
by it, except for such taxes (i) which are not yet delinquent or (ii) that are
being contested in good faith and by proper proceedings, and against which
adequate reserves are being maintained in accordance with GAAP. No Credit Party
is aware of any proposed tax assessments issued by a taxing authority to and
against such Credit Party, except as would not have or be reasonably expected to
have a Material Adverse Effect.
6.13 Compliance with Law. Each Credit Party, and each of its
Subsidiaries, is in compliance with all Requirements of Law and all other laws,
rules, regulations, orders and decrees (including without limitation
Environmental Laws) applicable to it, or to its properties, unless such failure
to comply would not have or would not be reasonably expected to have a Material
Adverse Effect.
56
6.14 ERISA. Except as set forth on Schedule 6.14 or except as would not
result or be reasonably expected to result in a Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no Termination Event
has occurred, and, to the best knowledge of the Credit Parties, no
event or condition has occurred or exists as a result of which any
Termination Event could reasonably be expected to occur, with respect
to any Plan; (ii) no "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether or
not waived, has occurred with respect to any Plan; (iii) each Plan has
been maintained, operated, and funded in compliance with its own terms
and in material compliance with the provisions of ERISA, the Code, and
any other applicable federal or state laws; and (iv) no lien in favor
or the PBGC or a Plan has arisen or is reasonably likely to arise on
account of any Plan.
(b) The actuarial present value of all "benefit liabilities"
under each Single Employer Plan (determined within the meaning of
Section 401(a)(2) of the Code, utilizing the actuarial assumptions used
to fund such Plans), whether or not vested, did not, as of the last
annual valuation date prior to the date on which this representation is
made or deemed made, exceed the current value of the assets of such
Plan allocable to such accrued liabilities.
(c) Neither the Borrower, nor any of its Subsidiaries nor any
ERISA Affiliate has incurred, or, to the best knowledge of the Credit
Parties, are reasonably expected to incur, any withdrawal liability
under ERISA to any Multiemployer Plan or Multiple Employer Plan that
could have or be reasonably expected to have a Material Adverse Effect.
Neither the Borrower, any of its Subsidiaries nor any ERISA Affiliate
has received any notification that any Multiemployer Plan is in
reorganization (within the meaning of Section 4241 of ERISA), is
insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no
Multiemployer Plan is, to the best knowledge of the Credit Parties,
reasonably expected to be in reorganization, insolvent, or terminated.
For the purposes of this subsection (c), "ERISA Affiliate" means an
entity, whether or not incorporated, which is under common control with
any Credit Party or any of its Subsidiaries within the meaning of
Section 4001(a)(14) of ERISA, or is a member of a group which includes
any Credit Party or any of its Subsidiaries and which is treated as a
single employer under Section 414(b), (c), (m), or (o) of the Code.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or to the best knowledge of the Borrower is reasonably likely to
subject the Borrower or any of its Subsidiaries or any ERISA Affiliate
to any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which the Borrower or any of its Subsidiaries or any ERISA
Affiliate has agreed or is required to indemnify any person against any
such liability.
(e) The present value (determined using actuarial and other
assumptions which are reasonable with respect to the benefits provided
and the employees participating) of the
57
liability of the Borrower and its Subsidiaries and each ERISA Affiliate
for post-retirement welfare benefits to be provided to their current
and former employees under Plans which are welfare benefit plans (as
defined in Section 3(1) of ERISA), net of all assets under all such
Plans allocable to such benefits, are reflected on the Financial
Statements in accordance with FASB 106.
(f) Each Plan which is a welfare plan (as defined in Section
3(1) of ERISA) to which Sections 601-609 of ERISA and Section 4980B of
the Code apply has been administered in compliance in all material
respects with such sections.
6.15 Subsidiaries. As of the Closing Date, set forth on Schedule 6.15
is a complete and accurate list of all Subsidiaries of each Credit Party,
including the jurisdiction of incorporation or organization for each such
Subsidiary and the location of its facilities and whether such Subsidiary is a
Domestic Subsidiary, a Foreign Subsidiary, a First Tier Foreign Subsidiary or a
Material Subsidiary.
6.16 Use of Proceeds. The proceeds of the Loans hereunder will be used
solely for the purposes specified in Section 7.10. None of the proceeds of the
Loans or other Extensions of Credit will be used in such a manner as to cause a
violation of Regulation U or X or to make an Investment other than a Permitted
Investment. Following application of the proceeds of each Loan and after giving
effect to any Permitted Acquisition, not more than 25 percent of the value of
the assets either (a) of the Borrower only or (b) of the Borrower and its
Subsidiaries on a consolidated basis (to the extent that such assets are subject
to any restriction contained in any agreement or instrument between the Borrower
and any Lender or any Affiliate of any Lender relating to Indebtedness) will be
Margin Stock (as defined in Regulation U).
6.17 Government Regulation. No Credit Party, nor any of its
Subsidiaries, is subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act, the Investment Company Act of 1940 or the
Interstate Commerce Act, each as amended. In addition, no Credit Party, nor any
of its Subsidiaries, is (a) an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or controlled
by such a company, or (b) a "holding company," or a "Subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "Subsidiary"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, as amended. No director or executive officer of the Borrower or any
of its Subsidiaries is a director, executive officer or principal shareholder of
any Lender. For the purposes hereof the terms "director", "executive officer"
and "principal shareholder" (when used with reference to any Lender) have the
respective meanings assigned thereto in Regulation O issued by the Board of
Governors of the Federal Reserve System.
58
6.18 Environmental Matters.
Except as disclosed on Schedule 6.18 or except as would not
have or be reasonably expected to have a Material Adverse Effect:
(i) Each of the real properties owned or
leased by the Credit Parties or any of their Subsidiaries (the
"Real Properties") and all operations at the Real Properties
are in compliance with all applicable Environmental Laws, and
there is no violation of any Environmental Law with respect to
the Real Properties or the businesses operated by the Borrower
or any of their Subsidiaries (the "Businesses"), and there are
no conditions relating to the Businesses or Real Properties
that would be reasonably expected to give rise to liability
under any applicable Environmental Laws.
(ii) No Credit Party has received any written
notice of, or written inquiry from any Governmental Authority
regarding, any violation, alleged violation, non-compliance,
liability or potential liability regarding Hazardous Materials
or compliance with Environmental Laws with regard to any of
the Real Properties or the Businesses, nor does the Borrower
or any of its Subsidiaries have knowledge that any such notice
is being threatened.
(iii) Hazardous Materials have not been
transported or disposed of from the Real Properties, or
generated, treated, stored or disposed of at, on or under any
of the Real Properties, in each case by, or on behalf or with
the permission of, the Borrower or any of its Subsidiaries in
a manner that would reasonably be expected to give rise to
liability under any applicable Environmental Law.
(iv) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Borrower or any of its Subsidiaries, threatened, under any
Environmental Law to which the Borrower or any of its
Subsidiaries is or will be named as a party, nor are there any
consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental
Law with respect to the Borrower or any of its Subsidiaries,
the Real Properties or the Businesses, in any amount
reportable under the federal Comprehensive Environmental
Response, Compensation and Liability Act or any analogous
state law, except releases in compliance with any
Environmental Laws.
(v) There has been no release of Hazardous
Materials at or from the Real Properties, or arising from or
related to the operations (including, without limitation,
disposal) of the Borrower or any of its Subsidiaries in
connection with the Real Properties or otherwise in connection
with the Businesses.
(vi) None of the Real Properties contains, or
has previously contained, any Hazardous Materials at, on or
under the Real Properties in amounts
59
or concentrations that, if released, constitute or constituted
a violation of, or could give rise to liability under,
Environmental Laws.
(vii) No Credit Party, nor any of its
Subsidiaries, has assumed any liability of any Person (other
than another Credit Party) under any Environmental Law.
6.19 Intellectual Property. Each Credit Party, and each of its
Subsidiaries, owns, or has the legal right to use, all trademarks, tradenames,
patents, copyrights, technology, know-how and processes (the "Intellectual
Property") necessary for each of them to conduct its business as currently
conducted except for those the failure to own or have such legal right to use
would not have or be reasonably expected to have a Material Adverse Effect.
6.20 Investments. All Investments of each Credit Party and each of its
Material Subsidiaries are either Permitted Investments or otherwise permitted by
the terms of this Credit Agreement.
6.21 Disclosure. To the best of the Borrower's knowledge, when taken
together with all information disclosed or reflected in the Disclosure
Documents, in each case, as amended, modified or supplemented from time to time
prior to the time this representation is made or deemed made by the Borrower, no
written or formally presented information and data concerning the Borrower and
its Subsidiaries (except for financial statements, projections, annual business
plans and budgets and except for information and data published by Persons other
than (a) the Borrower or its Subsidiaries and (b) before the Spin-Off, Corning
Incorporated or its Subsidiaries) which are made available to any Lender in
connection with this Credit Agreement or any other Credit Document contain any
untrue statement of material fact or omit to state a material fact necessary in
order to make the statement therein not materially misleading in light of the
circumstances under which such statements are made.
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until all
Commitments and Letters of Credit have been terminated and the Loans and LOC
Obligations, together with interest and fees hereunder, have been paid in full:
7.1 Information Covenants. The Borrower will furnish, or cause to be
furnished, to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Borrower, a consolidated balance sheet and income statement of the
Borrower and its Subsidiaries, as of the end of such fiscal year,
together with related consolidated statements of stockholder's equity
and of cash flows for such fiscal year, setting forth in comparative
form consolidated figures for the preceding
60
fiscal year, all such financial information described above to be in
reasonable form and detail and audited by independent certified public
accountants of recognized national standing reasonably acceptable to
the Agents and whose opinion shall be to the effect that such financial
statements have been prepared in accordance with GAAP (except for
changes with which such accountants concur) and shall not be limited as
to the scope of the audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and
in any event within 60 days after the close of the first three quarters
of each fiscal year of the Borrower, (i) a consolidated balance sheet
and income statement of the Borrower and its Subsidiaries, as of the
end of such fiscal quarter, together with related consolidated
statements of cash flows for such fiscal quarter in each case setting
forth in comparative form consolidated figures for the corresponding
period of the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and reasonably
acceptable to the Agents, and accompanied by a certificate of the chief
financial officer of the Borrower to the effect that such quarterly
financial statements fairly present in all material respects the
financial condition of the Borrower and its Subsidiaries and have been
prepared in accordance with GAAP, subject to changes resulting from
audit and normal year-end audit adjustments and (ii) a management
discussion and analysis of operating results for such fiscal quarter.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b) above,
a certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.2 by
calculation thereof as of the end of each such fiscal period, and
showing the calculation of the Adjusted Leverage Ratio for purposes of
determining Applicable Percentage, (ii) certifying as to which
Subsidiaries are Material Subsidiaries and calculating the percentage
of total assets of the Borrower and its Subsidiaries, on a consolidated
basis, owned by (x) the Credit Parties and (y) First Tier Foreign
Subsidiaries in which the Lenders have received a pledge of 65% of
their Voting Stock, and (iii) stating that no Default or Event of
Default has occurred and is continuing, or if any Default or Event of
Default has occurred and is continuing, specifying the nature and
extent thereof and what action the Borrower proposes to take with
respect thereto.
(d) Auditor's Reports. Promptly upon receipt thereof, a copy
of any "management letter" submitted by independent accountants to the
Borrower or any of its Subsidiaries in connection with any annual audit
of the books of the Borrower or any of its Subsidiaries.
(e) Reports. (i) Promptly upon transmission or receipt
thereof, copies of any filings and registrations with, and reports to
or from, the Securities and Exchange Commission, or any successor
agency, and copies of all financial statements, proxy statements,
notices and reports as the Borrower or any of its Subsidiaries shall
send to its shareholders generally and (ii) upon the reasonable written
request of an Agent, all reports and written information to and from
the United States Environmental Protection Agency, or any state or
local agency responsible for environmental matters, the United States
Occupational Health and Safety Administration, or any state or local
agency responsible for
61
health and safety matters, or any successor agencies or authorities
concerning environmental, health or safety matters.
(f) Notices. Upon the Borrower obtaining knowledge thereof,
the Borrower will give written notice to the Administrative Agent
promptly of (i) the occurrence of an event or condition consisting of a
Default or Event of Default, specifying the nature and existence
thereof and what action the Borrower proposes to take with respect
thereto, and (ii) the occurrence of any of the following with respect
to the Borrower or any of its Subsidiaries (x) the pendency or
commencement of any litigation, arbitral or governmental proceeding
against the Borrower or any of its Subsidiaries which if adversely
determined would have or would be reasonably expected to have a
Material Adverse Effect, or (y) the institution of any proceedings
against the Borrower or any of its Subsidiaries with respect to, or the
receipt of notice by such Person of potential liability or
responsibility for violation, or alleged violation of any federal,
state or local law, rule or regulation, including but not limited to,
Environmental Laws, the liability for the violation of which would have
or would be reasonably expected to have a Material Adverse Effect.
(g) ERISA. Upon any of the Credit Parties or any ERISA
Affiliate obtaining knowledge thereof, Borrower will give written
notice to the Administrative Agent and each of the Lenders promptly
(and in any event within five Business Days) of: (i) any event or
condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, a Termination Event; (ii)
with respect to any Multiemployer Plan, the receipt of notice as
prescribed in ERISA or otherwise of any withdrawal liability assessed
against the Borrowers or any of their ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or
insolvent (both within the meaning of Title IV of ERISA); (iii) the
failure to make full payment on or before the due date (including
extensions) thereof of all amounts which the Borrower or any of its
Subsidiaries or ERISA Affiliates is required to contribute to each Plan
pursuant to its terms and as required to meet the minimum funding
standard set forth in ERISA and the Code with respect thereto; or (iv)
any change in the funding status of any Plan that could or could be
reasonably expected to have a Material Adverse Effect; together, with a
description of any such event or condition or a copy of any such notice
and a statement by the principal financial officer of the Borrower
briefly setting forth the details regarding such event, condition, or
notice, and the action, if any, which has been or is being taken or is
proposed to be taken by the Credit Parties with respect thereto.
Promptly upon request, the Borrower shall furnish the Administrative
Agent and each of the Lenders with such additional information
concerning any Plan as may be reasonably requested, including, but not
limited to, copies of each annual report/return (Form 5500 series), as
well as all schedules and attachments thereto required to be filed with
the Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the
meaning of Section 3(39) of ERISA).
(h) Environmental.
(i) Subsequent to a notice from the Borrower pursuant to
Section 7.1(f)(ii)(y) or during the existence of an Event of Default,
and upon the written
62
request of an Agent, the Borrower will furnish or cause to be
furnished to the Administrative Agent, at the Borrower's
expense, a report of an environmental assessment of reasonable
scope, form and depth, including, where appropriate, invasive
soil or groundwater sampling, by a consultant reasonably
acceptable to the Agents as to the nature and extent of the
presence of any Hazardous Materials on any property owned,
leased or operated by a Credit Party and as to the compliance
by the Credit Parties with Environmental Laws. If the Borrower
fails to deliver such an environmental report within
seventy-five (75) days after receipt of such written request
then the Agents may arrange for same, and the Borrower hereby
grants to the Agents and their representatives access to the
Real Properties and a license of a scope reasonably necessary
to undertake such an assessment (including, where appropriate,
invasive soil or groundwater sampling). The reasonable cost of
any assessment arranged for by the Agents pursuant to this
provision will be payable by the Borrower on demand and added
to the Credit Party Obligations.
(ii) Each Credit Party will conduct and
complete all investigations, studies, sampling, and testing
and all remedial, removal, and other actions necessary to
address all Hazardous Materials on, from, or affecting any
Real Property to the extent necessary to be in compliance with
all Environmental Laws and all other applicable federal,
state, and local laws, regulations and rules and with the
orders and directives of all Governmental Authorities
exercising jurisdiction over such Real Property to the extent
any failure would have or be reasonably expected to have a
Material Adverse Effect.
(i) Other Information. With reasonable promptness upon any
such request, such other information regarding the business, properties
or financial condition of the Credit Parties as an Agent may reasonably
request, including, without limitation, appraisals on personal
property.
7.2 Financial Covenants.
(a) Leverage Ratio. The Leverage Ratio, as of the end of each
fiscal quarter of the Borrower for the twelve month period ending on
such date, shall be less than or equal to:
(i) On December 31, 1996 and March 31, 1997, 3.30 to
1.0;
(ii) On June 30, 1997 and September 30, 1997, 3.25 to
1.0;
(iii) On December 31, 1997 and March 31, 1998, 3.00
to 1.0; and (iv) On June 30, 1998 and on the
last day of each fiscal quarter of the Borrower
thereafter, 2.75 to 1.0.
(b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio, as of the end of each fiscal quarter of the Borrower for the
twelve month period ending on such date, shall be greater than or equal
to:
63
(i) On the last day of each fiscal quarter of the
Borrower from the Closing Date to and including
September 30, 1997, 2.0 to 1.0; and
(ii) On December 31, 1997 and on the last day of
each fiscal quarter of the Borrower thereafter,
2.25 to 1.0.
7.3 Preservation of Existence and Franchises. Each of the Credit
Parties will, and will cause all of their Subsidiaries to, do all things
necessary to preserve and keep in full force and effect its existence, rights,
franchises and authority except (a) as permitted by Section 8.4 or (b) as would
not have or be reasonably expected to have a Material Adverse Effect.
7.4 Books and Records. Each of the Credit Parties will, and will cause
all of their Material Subsidiaries to, keep complete and accurate books and
records of its transactions in accordance with good accounting practices on the
basis of GAAP (including the establishment and maintenance of appropriate
reserves).
7.5 Compliance with Law. Each of the Credit Parties will comply, and
will cause all of their Subsidiaries to comply, with all laws, rules,
regulations and orders, and all applicable restrictions imposed by all
Governmental Authorities, applicable to it and its property (including, without
limitation, Environmental Laws) unless such non-compliance would not have or
would not be reasonably expected to have a Material Adverse Effect.
7.6 Payment of Taxes and Other Indebtedness. Each of the Credit Parties
will, and will cause all of their Subsidiaries to, pay, settle or discharge (a)
all taxes, assessments and governmental charges or levies imposed upon it, or
upon its income or profits, or upon any of its properties, before they shall
become delinquent, (b) all lawful claims (including claims for labor, materials
and supplies) which, if unpaid, might give rise to a Lien upon any of its
properties, and (c) except as prohibited hereunder, all of its other
Indebtedness as it shall become due; provided, however, that a Credit Party
shall not be required to pay any such tax, assessment, charge, levy, claim or
Indebtedness which is being contested in good faith by appropriate proceedings
and as to which adequate reserves therefor have been established in accordance
with GAAP, unless the failure to make any such payment would have a Material
Adverse Effect.
7.7 Insurance. The Borrower will, for itself and on behalf of each of
its Subsidiaries, at all times maintain in full force and effect insurance
(including worker's compensation insurance, liability insurance, casualty
insurance and business interruption insurance) in such amounts, covering such
risks and liabilities and with such deductibles or self-insurance retentions as
are in accordance with normal industry practice. The insurance coverage of the
Borrower and its Subsidiaries, as of the Closing Date, is outlined as to
carrier, policy number, expiration date, type and amount on Schedule 7.7.
7.8 Maintenance of Property. Except as permitted by Section 7.3, each
of the Credit Parties will, and will cause their Subsidiaries to, maintain and
preserve its properties and equipment in good repair, working order and
condition, normal wear and tear excepted (subject to damage by casualties), and
will make, or cause to be made, in such properties and equipment from time to
time
64
all repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent and in the manner
customary for companies in similar businesses unless the failure to do so would
not have or would not be reasonably expected to have a Material Adverse Effect.
7.9 Performance of Obligations. Each of the Credit Parties will, and
will cause their Subsidiaries to, perform in all respects all of its obligations
under the terms of all agreements, indentures, mortgages, security agreements or
other debt instruments to which it is a party or by which it is bound unless the
failure to do so would not have or be reasonably expected to have a Material
Adverse Effect.
7.10 Use of Proceeds. The Borrower will use the proceeds of the Loans
solely (a) to effect the Spin-Off including refinancing the current existing
intercompany debt of the Borrower and its Subsidiaries and the payment of any
federal consolidated tax liabilities of the Borrower and its Subsidiaries and
(b) to provide for working capital, capital expenditures, acquisitions and other
lawful corporate purposes of the Borrower and its Subsidiaries.
7.11 Audits/Inspections. Upon reasonable notice and during normal
business hours and in a manner that will not unreasonably interfere with its
business operations, each Credit Party will, and will cause their Subsidiaries
to, permit representatives appointed by an Agent (and upon the request of the
Required Lenders, an Agent shall make such appointment), including, without
limitation, independent accountants, agents, attorneys and appraisers to visit
and inspect such Credit Party's or Subsidiaries' property, including its books
and records, its accounts receivable and inventory, its facilities and its other
business assets, and to make photocopies or photographs thereof and to write
down and record any information such representative obtains and shall permit an
Agent or its representatives to investigate and verify the accuracy of
information provided to the Lenders, and to discuss all such matters with the
officers, employees and representatives of the Credit Parties and their
Subsidiaries.
7.12 Additional Credit Parties. Within 30 days after the date the
officer's certificate is due pursuant to Section 7.1(c), the Borrower shall
cause (a) each Person who is a Material Domestic Subsidiary who is not already a
Guarantor to execute a Joinder Agreement in substantially the form of Exhibit
7.12, (b) itself and each Domestic Subsidiary that directly owns a Material
First Tier Foreign Subsidiary to pledge 65% of the Voting Stock of such Material
First Tier Foreign Subsidiary pursuant to a Pledge Agreement (to the extent 65%
of the Voting Stock of such Material First Tier Foreign Subsidiary was not
previously pledged), (c) itself and each Material Domestic Subsidiary that has
loaned money to a Non-Material Domestic Subsidiary to evidence such loan by an
enforceable promissory note and to deliver such promissory note, together with a
Collateral Assignment of Note and endorsement thereto (to the extent not
previously delivered), (d) such other Persons to execute Joinder Agreements or
pledge Voting Stock as required by Section 7.15, and (e) deliver such other
documentation as the Administrative Agent may reasonably request in connection
with the foregoing, including, without limitation, (i) appropriate certified
resolutions and other organizational and authorizing documents of such Person,
(ii) favorable opinions of counsel to such Person (which shall cover, among
other things, the legality, validity, binding effect and enforceability of the
documentation referred to above), all in form, content and scope reasonably
satisfactory to the Administrative Agent, and (iii) stock certificates with
stock powers executed in
65
blank or evidence of perfection (which may include opinions) regarding
uncertificated securities and/or original promissory notes with executed
endorsements attached thereto. The Lenders agree that within 30 days after
receipt of reasonably sufficient evidence that (x) a Domestic Subsidiary ceases
to be a Material Domestic Subsidiary or (y) a Material First Tier Foreign
Subsidiary ceases to be a First Tier Foreign Subsidiary or ceases to be a
Material Foreign Subsidiary, then either such Domestic Subsidiary shall be
released from its obligations as a Guarantor or the stock of such Foreign
Subsidiary shall be returned to the Domestic Subsidiary pledging such stock. The
Lenders further agree that within 30 days after notice from the Borrower that
any loan or series of loans referred to in clause (c) above has been repaid in
full, then the pledge of the promissory note evidencing such loan shall be
terminated and the Administrative Agent shall release and return such promissory
note, together with the related Collateral Assignment of Note, to the Borrower
or such Material Domestic Subsidiary, as the case may be. The Agent is hereby
authorized in connection with the events described in the prior two sentences,
at the expense of the Borrower, to execute such documentation as appropriate to
evidence such release or return unless, in the circumstances described in (x)
and (y) above, such release or return would cause a violation of Section 7.15.
7.13 Spin-Off. On or before March 31, 1997, the Agents shall have
received (a) evidence reasonably sufficient to them that (i) the Spin-Off has
occurred in accordance with applicable law and the terms and conditions of the
IRS Letter Ruling issued in connection therewith and (ii) the intercompany debt
has been repaid in connection with the Spin-Off, (b) copies of the Tax
Indemnification Agreements, the Tax Sharing Agreement and the Transaction
Agreement (which shall be in substantially the form delivered to the Lenders on
or before the Effective Date) and, if requested by a Lender, copies of all other
documents executed and delivered in connection with the Spin-Off, and (c) the
registration statement filed by the Borrower and declared effective by the
Securities and Exchange Commission.
7.14 Uncertificated Securities. On or before March 31, 1997, the
Administrative Agent shall have received evidence satisfactory to it that the
Lenders have a first priority perfected security interest in the uncertificated
securities pledged on the Closing Date pursuant to the Pledge Agreements,
including, without limitation, opinions from foreign counsel.
7.15 Additional Guarantors or Additional Pledges of Stock. (a) The
Borrower shall take all necessary action, at the times specified by the second
and third sentences of this Section 7.15(a), in respect of each fiscal quarter,
to ensure that, as of the last day of such fiscal quarter (after giving effect
to any Joinder Agrement and/or Pledge Agreement executed in respect of such
fiscal quarter pursuant to Section 7.12), the combined sum of the total assets
(excluding assets that pursuant to GAAP principles of consolidation would be
eliminated from the consolidated balance sheet of the Borrower as of such date)
owned by (a) the Credit Parties (together with their Subsidiaries on a
consolidated basis) and (b) the First Tier Foreign Subsidiaries in which the
Lenders have received a pledge of at least 65% of their Voting Stock (together
with their Subsidiaries on a consolidated basis) is greater than or equal to 80%
of the total assets owned by the Borrower and its Subsidiaries on a consolidated
basis. If on the date the officer's certificate is required to be delivered by
Section 7.1(c), the Borrower is not in compliance with the first sentence of
this Section 7.15(a), then, within 30 days after the due date of such
certificate, the Borrower shall do either or both of the following (as the
Borrower shall choose in its discretion): (a) cause additional Domestic
Subsidiaries to execute and deliver Joinder Agreements or (b) pledge or cause
one or more of its Domestic
66
Subsidiaries to pledge (pursuant to a Pledge Agreement) 65% of the Voting Stock
of one or more additional First Tier Foreign Subsidiaries to the extent
necessary to be in compliance with the first sentence of this Section 7.15(a)
and to deliver such other documents, instruments, certificates or opinions in
connection therewith as required in connection with the execution of Joinder
Agreements or the pledge of Voting Stock as set forth in Section 7.12(e).
(b) If, as of the last day of any fiscal quarter of the Borrower, the
percentage of total assets determined pursuant to the first sentence of Section
7.15(a) is greater than 80%, then, within 30 days of notice thereof by the
Borrower, the Lenders shall, as directed by the Borrower in its discretion, (i)
release any Domestic Subsidiary (other than a Material Domestic Subsidiary) from
its obligation as Guarantor and (ii) such pledged Voting Stock of any First Tier
Foreign Subsidiary (other than a Material First Tier Foreign Subsidiary),
together with any such other documents, instruments or certificates which were
delivered in connection with the execution of any Joinder Agreement executed by
such Domestic Subsidiary or pledge of Voting Stock by such Foreign Subsidiary;
provided however, that after giving effect to such release or return, the
Borrower and its Subsidiaries shall be in compliance with Section 7.15(a).
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until all
Commitments and Letters of Credit have been terminated and the Loans and LOC
Obligations, together with interest and fees hereunder, have been paid in full:
8.1 Indebtedness. No Credit Party will, nor will it permit any of its
Subsidiaries to, contract, create, incur, assume or permit to exist any
Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the
other Credit Documents;
(b) Indebtedness existing as of the Closing Date as referenced
in Section 6.10 (and renewals, refinancings or extensions thereof on
terms and conditions substantially the same as such existing
Indebtedness and in a principal amount not in excess of that
outstanding as of the date of such renewal, refinancing or extension);
(c) Indebtedness in respect of current accounts payable and
accrued expenses incurred in the ordinary course of business including,
to the extent not current, accounts payable and accrued expenses that
are subject to bona fide dispute;
(d) purchase money Indebtedness (including Capital Leases)
incurred by the Borrower or any of its Subsidiaries to finance the
purchase of fixed assets; provided that (i) the total of all such
Indebtedness for all such Persons taken together shall not exceed an
aggregate principal amount of $10,000,000 at any one time outstanding
(including any such Indebtedness referred to in subsection (b) above);
(ii) such Indebtedness when incurred shall not exceed the purchase
price of the asset(s) financed; and (iii) no such Indebtedness shall
67
be refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing;
(e) other unsecured Indebtedness owing by Domestic
Subsidiaries not to exceed, in the aggregate, at any one time,
$10,000,000; and
(f) other unsecured Indebtedness owing by Foreign Subsidiaries
not to exceed, in the aggregate, at any one time, $10,000,000.
8.2 Liens. No Credit Party will, nor will it permit its Subsidiaries
to, contract, create, incur, assume or permit to exist any Lien with respect to
any of its property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3 Nature of Business. The Borrower will not, and will not permit its
Material Subsidiaries to, engage in any business other than (a) businesses in
which the Borrower (whether directly or through one or more of its Subsidiaries)
engages on the Closing Date or are contemplated by the Information Statement,
(b) similar or related businesses (including, without limitation, similar or
related businesses that serve the industries which purchase or use goods
manufactured or processed or services rendered by, any business in which the
Borrower is then permitted to engage (whether directly or through one or more of
its Subsidiaries), pursuant to this Section 8.3, and (c) businesses incidental
to the foregoing.
8.4 Consolidation and Merger. No Credit Party will nor will it permit
any Subsidiary to, enter into any transaction of merger or consolidation or
liquidate, wind up or dissolve itself; provided that a Credit Party or a
Subsidiary of a Credit Party may merge or consolidate with or into another
Person if the following conditions are satisfied:
(a) the Administrative Agent is given prior written notice of
such action;
(b) if the merger or consolidation involves a Credit Party,
the Person formed by such consolidation or into which a Credit Party is
merged shall either (i) be such Credit Party or (ii) be a Domestic
Subsidiary and shall expressly assume in writing all of the obligations
of such Credit Party under the Credit Documents; provided that if the
transaction is between the Borrower and another Person, the Borrower
must be the surviving entity;
(c) if the merger or consolidation involves a Material First
Tier Foreign Subsidiary, the Lenders receive 65% of the Voting Stock of
the surviving Material First Tier Foreign Subsidiary, if any;
(d) to the extent otherwise required by Section 7.12 or 7.15,
the Credit Parties execute and deliver such documents, instruments and
certificates as the Administrative Agent may request (including, if
necessary, to maintain its perfection and priority in the collateral
pledged pursuant to the Collateral Documents;
68
(e) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; and
(f) the Borrower delivers to the Agents an officer's
certificate demonstrating compliance with clause (b) or (c) above, as
applicable, and an opinion of counsel (who may, at the option of the
Borrower, be the Borrower's in-house counsel) stating that such
consolidation or merger and any written agreement entered into in
connection therewith, comply with this Section 8.4.
8.5 Sale or Lease of Assets. No Credit Party will, nor will it permit
any of its Subsidiaries to, convey, sell, lease, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or any part of its
business or assets whether now owned or hereafter acquired, including, without
limitation, inventory, receivables, equipment, real property interests (whether
owned or leasehold), and securities, other than (a) any inventory sold or
otherwise disposed of in the ordinary course of business; (b) the sale, lease,
transfer or other disposal by a Credit Party (other than the Borrower) of any or
all of its assets to the Borrower or to another Credit Party; (c) obsolete,
slow-moving, idle or worn-out assets (including inventory) no longer used or
useful in its business; (d) the transfer of assets which constitute a Permitted
Investment or (e) such other transfer of assets if (i) such transfer is for fair
market value, (ii) at the time of such transfer no Default or Event of Default
exists and is continuing, (iii) as a result of such transfer no Material Adverse
Effect would occur or be reasonably likely to occur, (iv) the proceeds from such
transfer are not used to pay dividends and (v) the proceeds from such transfer
are, within six months from the date of such transfer, reinvested in a business
of a type similar to that which the Credit Parties and their Subsidiaries are
already engaged or were engaged at the time of such sale.
8.6 Sale Leasebacks. No Credit Party will directly or indirectly, nor
will it permit its Subsidiaries to, become or remain liable as lessee or as
guarantor or other surety with respect to any lease of any property (whether
real or personal or mixed), whether now owned or hereafter acquired, (a) which
such Credit Party has sold or transferred or is to sell or transfer to any other
Person other than a Credit Party or (b) which such Credit Party intends to use
for substantially the same purpose as any other property which has been sold or
is to be sold or transferred by such Credit Party to any Person in connection
with such lease.
8.7 Advances, Investments and Loans. No Credit Party will, nor will it
permit its Subsidiaries to, make any Investments except for Permitted
Investments.
8.8 Restricted Payments. No Credit Party will, directly or indirectly,
nor will it permit its Subsidiaries to, (a) declare or pay any dividends or make
any other distribution upon any shares of its capital stock of any class or (b)
purchase, redeem or otherwise acquire or retire or make any provisions for
redemption, acquisition or retirement of any shares of its capital stock of any
class or any warrants or options to purchase any such shares (any such dividend,
repurchase, redemption, acquisition or retirement being a "Restricted Payment");
provided that (i) any Subsidiary of the Borrower may make Restricted Payments to
the Borrower, (ii) stock dividends may be paid pursuant to the Rights Plan and
the Benefits Plans, (iii) as long as no Default or Event of Default exists and
is continuing, Restricted Payments may be made with respect to (A) the Benefits
Plans of the type referred to in subsection (a) and (b) of the definition of
"Benefits Plans", (B) the Benefits Plans of
69
the type referred to in subsection (c), (d), (e) and (f) of the definition of
"Benefits Plans" in an aggregate amount not to exceed $50,000,000, during the
term of this Credit Agreement and (C) the Rights Plans in an aggregate amount
not to exceed $2,000,000 during the term of this Credit Agreement, (iv) other
than with proceeds from a sale as set forth in Section 8.5, Restricted Payments
may be made if (A) no Default or Event of Default exists and is continuing and
(B) after giving effect thereto, the Credit Parties and their Subsidiaries are
in compliance with Section 7.2 and (v) the Borrower and any of its Subsidiaries
may repurchase stock of Covance Bio Technology Services Inc. in accordance with
that certain Capital Contribution and Shareholder's Agreement dated as of
February 22, 1995.
8.9 Fiscal Year; Organizational Documents. Except as set forth on
Schedule 8.9, no Credit Party will, nor will it permit its Subsidiaries to, (a)
change its fiscal year or (b) change its articles or certificate of
incorporation or its bylaws if such change would have or be reasonably expected
to have a Material Adverse Effect.
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default. An Event of Default shall exist upon the
occurrence of any of the following specified events (each an "Event of
Default"):
(a) Payment. Any Credit Party shall default in the payment (i)
when due of any principal of any of the Loans or any reimbursement
obligation arising from drawings under Letters of Credit or (ii) within
three days of when due of any interest on the Loans or any fees or
other amounts owing hereunder, under any of the other Credit Documents
or in connection herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Credit Documents, or in any state ment or certificate delivered
or required to be delivered pursuant hereto or thereto shall prove
untrue in any material respect on the date as of which it was made or
deemed to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or
observance of any term, covenant or agreement
contained in Sections 7.2 or 8.1 through 8.9
inclusive; or
(ii) default in the due performance or
observance by it of any term, covenant or agreement
contained in Section 7.1 and such default shall
continue unremedied for a period of five Business
Days after the earlier of an officer of the Borrower
becoming aware of such default or notice thereof
given by an Agent; or
70
(iii) default in the due performance or
observance by it of any term, covenant or agreement (other
than those referred to in subsections (a), (b) or (c)(i) or
(ii) of this Section 9.1) contained in this Credit Agreement
and such default shall continue unremedied for a period of at
least 20 Business Days after notice thereof given by an Agent.
(d) Other Credit Documents. (i) Any Credit Party shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Credit Documents and such default shall continue
unremedied for a period of at least 20 Business Days after notice
thereof given by an Agent, or (ii) any Credit Document shall fail to be
in full force and effect or the Borrower shall so assert or any Credit
Document shall fail to give the Agents and/or the Lenders the security
interests, liens, rights, powers and privileges purported to be created
thereby.
(e) Guaranties. The guaranty given by the Credit Parties
hereunder or by any Additional Credit Party hereafter or any provision
thereof shall cease to be in full force and effect, or any guarantor
thereunder or any Person acting by or on behalf of such guarantor shall
deny or disaffirm such Guarantor's obligations under such guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following
with respect to the Borrower or any of its Material Subsidiaries (i) a
court or governmental agency having juris diction in the premises shall
enter a decree or order for relief in respect of the Borrower or any of
its Material Subsidiaries in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
or appoint a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Borrower or any of its Material
Subsidiaries or for any substantial part of its property or ordering
the winding up or liquidation of its affairs; or (ii) an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect is commenced against the Borrower or any of
its Material Subsidiaries and such petition remains unstayed and in
effect for a period of 60 consecutive days; or (iii) the Borrower or
any of its Material Subsidiaries shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consent to the entry of an order for relief in
an involuntary case under any such law, or consent to the appointment
or taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of such Person or any
substantial part of its property or make any general assignment for the
benefit of creditors; or (iv) the Borrower or any of its Material
Subsidiaries shall admit in writing its inability to pay its debts
generally as they become due or any action shall be taken by such
Person in furtherance of any of the aforesaid purposes.
(g) Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) of the Borrower or any of its Subsidiaries in an aggregate
principal amount in excess of $10,000,000, (i) a Credit Party shall (A)
default in any payment (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, or (B) default
(after giving effect to any applicable grace period) in the observance
or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or
any
71
other event or condition shall occur or condition exist, the effect of
which default or other event or condition is to cause, or permit, the
holder or holders of such Indebtedness (or trustee or agent on behalf
of such holders) to cause (determined without regard to whether any
notice or lapse of time is required) any such Indebtedness to become
due prior to its stated maturity; or (ii) any such Indebtedness shall
be declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment prior to the stated maturity
thereof and such Indebtedness remains unpaid; or (iii) any such
Indebtedness shall mature and remain unpaid.
(h) Judgments. One or more judgments, orders, or decrees shall
be entered against any one or more of the Credit Parties involving a
liability of $10,000,000 or more, in the aggregate, (to the extent not
paid or covered by insurance provided by a financially solvent carrier
who has acknowledged coverage) and such judgments, orders or decrees
(i) are the subject of any enforcement proceeding commenced by any
creditor or (ii) shall continue unsatisfied, undischarged and unstayed
for a period ending on the last day on which such judgment, order or
decree becomes final and unappealable.
(i) ERISA. The occurrence of any of the following events or
conditions: (A) any "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether or
not waived, shall exist with respect to any Plan, or any lien shall
arise on the assets of the Borrower or any of its Subsidiaries or any
ERISA Affiliate in favor of the PBGC or a Plan; (B) a Termination Event
shall occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Administrative Agent, likely to result in the
termination of such Plan for purposes of Title IV of ERISA; (C) a
Termination Event shall occur with respect to a Multiemployer Plan or
Multiple Employer Plan, which is, in the reasonable opinion of the
Administrative Agent, likely to result in (i) the termination of such
Plan for purposes of Title IV of ERISA, or (ii) the Borrower or any of
its Subsidiaries or any ERISA Affiliate incurring any liability in
connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency (within the meaning of
Section 4245 of ERISA) of such Plan; or (D) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the
Code) or breach of fiduciary responsibility shall occur which may
subject the Borrower or any of its Subsidiaries or any ERISA Affiliate
to any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which the Borrower or any of its Subsidiaries or any ERISA
Affiliate has agreed or is required to indemnify any person against any
such liability.
(j) Ownership. There shall occur a Change of Control.
9.2 Acceleration; Remedies. Following the occurrence and during the
continuance of an Event of Default, the Administrative Agent shall, upon the
request and direction of the Required Lenders, by written notice to the
Borrower, take any of the following actions without prejudice to the rights of
the Agents or any Lender to enforce its claims against the Credit Parties,
except as otherwise specifically provided for herein:
72
(a) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and
any accrued interest in respect of all Loans, any reimbursement
obligations arising from drawings under Letters of Credit and, without
duplication, any and all other indebtedness or obligations of any and
every kind then owing by a Credit Party to any of the Lenders hereunder
to be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the
Borrower agrees that upon receipt of such notice, or upon the
occurrence of an Event of Default under Section 9.1(f), it will
immediately pay) to the Administrative Agent additional cash, to be
held by the Administrative Agent, for the benefit of the Lenders, in a
cash collateral account as security for the LOC Obligations in respect
of subsequent drawings under all then outstanding Letters of Credit in
an amount equal to the maximum aggregate amount which may be drawn
under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents, including,
without limitation, all rights and remedies against a Guarantor, all
rights under the Collateral Documents and all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations under Letters of Credit, all accrued and
unpaid interest in respect thereof, all accrued and unpaid fees and other
indebtedness or obligations owing to the Lenders hereunder shall immediately
become due and payable without the giving of any notice or other action by the
Agents or the Lenders, which notice or other action is expressly waived by the
Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
9.3 Allocation of Payments After Event of Default. Notwithstanding any
other provisions of this Credit Agreement, after the occurrence and during the
continuance of an Event of Default, all amounts collected or received by an
Agent or any Lender on account of amounts outstanding under any of the Credit
Documents or collateral under the Pledge Agreement shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Agents in connection with enforcing the rights of the Lenders
under the Credit Documents and any protective advances made by the
Administrative Agent under or pursuant to the terms of the Pledge
Agreement;
SECOND, to payment of any fees owed to an Agent or the Issuing
Lender;
73
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses, (including, without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents;
FOURTH, to the payment of all accrued fees and interest
payable to the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of
the Loans and unreimbursed drawings under Letters of Credit and to the
payment or cash collateralization of the outstanding LOC Obligations,
pro rata, as set forth below;
SIXTH, to all other obligations of the Credit Parties which
shall have become due and payable under the Credit Documents and the
LOC Documents and not repaid pursuant to clauses "FIRST" through
"FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH," "FIFTH," and "SIXTH" above; and (c) to the extent that any
amounts available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Administrative Agent in a cash collateral
account and applied (x) first, to reimburse the Issuing Lender from time to time
for any drawings under such Letters of Credit and (y) then, following the
expiration of all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner provided in this
Section 9.3.
SECTION 10
AGENCY PROVISIONS
10.1 Appointment. Each Lender hereby designates and appoints
NationsBank, N.A. as Administrative Agent and Wachovia Bank of Georgia, N.A. as
Syndication Agent of such Lender to act as specified herein and the other Credit
Documents and the LOC Documents (including with respect to NationsBank, N.A. the
right to act as the collateral agent under the Collateral Documents), and each
such Lender hereby authorizes the Agents, as the agents for such Lender, to take
such action on its behalf under the provisions of this Credit Agreement and the
other Credit Documents and the LOC Documents and to exercise such powers and
perform such duties as are expressly delegated by the terms hereof and of the
other Credit Documents and of the LOC Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere herein and in the other Credit Documents, the Agents shall
not have any
74
duties or responsibilities, except those expressly set forth herein and therein,
or any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Credit Agreement or any of the other Credit Documents or any of the
LOC Documents, or shall otherwise exist against the Agents. The provisions of
this Section are solely for the benefit of the Agents and the Lenders and none
of the Credit Parties shall have any rights as a third party beneficiary of the
provisions hereof. In performing its functions and duties under this Credit
Agreement and the other Credit Documents and the LOC Documents, each Agent shall
act solely as an agent of the Lenders and does not assume and shall not be
deemed to have assumed any obligation or relationship of agency or trust with or
for any Credit Party.
10.2 Delegation of Duties. An Agent may execute any of its duties
hereunder or under the other Credit Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. An Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
10.3 Exculpatory Provisions. Neither the Agents nor any of their
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(a) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection herewith or in connection with any of the other
Credit Documents or the LOC Documents (except for its or such Person's own gross
negligence or willful misconduct) or (b) responsible in any manner to any of the
Lenders for any recitals, statements, representations or warranties made by any
of the Credit Parties contained herein or in any of the other Credit Documents
or the LOC Documents or in any certificate, report, document, financial
statement or other written or oral statement referred to or provided for in, or
received by an Agent under or in connection herewith or in connection with the
other Credit Documents or the LOC Documents, or enforceability or sufficiency
therefor of any of the other Credit Documents or the LOC Documents, or for any
failure of the Borrower to perform its obligations hereunder or thereunder. The
Agents shall not be responsible to any Lender for the effectiveness,
genuineness, validity, enforceability, collectibility or sufficiency of this
Credit Agreement, or any of the other Credit Documents or the LOC Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any Credit Party in any written or oral
statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by an Agent to the Lenders or by or on behalf of the Credit
Parties to the Agents or any Lender or be required to ascertain or inquire as to
the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or of the existence or
possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Credit Parties. The Agents are not trustees
for the Lenders and owe no fiduciary duty to the Lenders.
10.4 Reliance on Communications. The Agents shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to any of the Credit Parties,
independent accountants and other experts selected
75
by the Agents with reasonable care). The Agents may deem and treat the Lenders
as the owner of its interests hereunder for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.3(b). The Agents shall be
fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents or the LOC Documents unless
it shall first receive such advice or concurrence of the Required Lenders as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Agents shall in all
cases be fully protected in acting, or in refraining from acting, hereunder or
under any of the other Credit Documents or the LOC Documents in accordance with
a request of the Required Lenders (or to the extent specifically provided in
Section 11.6, all the Lenders) and such request and any action taken or failure
to act pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
10.5 Notice of Default. An Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has actual knowledge of such Default or Event of Default or has
received notice from a Lender or a Credit Party referring to the Credit
Document, describing such Default or Event of Default and stating that such
notice is a "notice of default." In the event that the Administrative Agent
receives such a notice or has such actual knowledge, the Administrative Agent
shall give prompt notice thereof to the Lenders. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders.
10.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents, NationsBanc Capital Markets, Inc. ("NCMI")
nor any of their officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
the Agents, NCMI or any affiliate thereof hereinafter taken, including any
review of the affairs of any Credit Party, shall be deemed to constitute any
representation or warranty by the Agents or NCMI to any Lender. Each Lender
represents to the Agents and NCMI that it has, independently and without
reliance upon the Agents or NCMI or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Agents, NCMI or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Credit
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent hereunder, the Agents
and NCMI shall not have any duty or responsibility to provide any Lender with
any credit or other information concerning the business, operations, assets,
property, financial or other conditions, prospects or creditworthiness of the
Credit Parties which may come into the possession of the Agents, NCMI or any of
their officers, directors, employees, agents, attorneys-in-fact or affiliates.
76
10.7 Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Commitments (or if the Commitments have expired or been terminated,
in accordance with the respective principal amounts of outstanding Loans and
Participation Interest of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against an
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or the LOC Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by an Agent under
or in connection with any of the foregoing; provided that no Lender shall be
liable for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the gross negligence or willful misconduct of an Agent. If any
indemnity furnished to an Agent for any purpose shall, in the opinion of such
Agent, be insufficient or become impaired, such Agent may call for additional
indemnity and cease, or not commence, to do the acts indemnified against until
such additional indemnity is furnished. The agreements in this Section shall
survive the payment of the Credit Party Obligations and all other amounts
payable hereunder and under the other Credit Documents.
10.8 Agents in Their Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with the Borrower or any other Credit Party as though such Agent were
not an Agent hereunder. With respect to the Loans made and Letters of Credit
issued and all obligations owing to it, an Agent shall have the same rights and
powers under this Credit Agreement as any Lender and may exercise the same as
though they were not an Agent, and the terms "Lender" and "Lenders" shall
include each Agent in its individual capacity.
10.9 Successor Agent. Any Agent may, at any time, resign upon 20 days
written notice to the Lenders. Upon any such resignation, the Required Lenders
shall, subject to the consent of the Borrower in its sole discretion, have the
right to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Lenders, and shall have accepted such appointment,
within 45 days after the notice of resignation, then the retiring Agent shall
select a successor Agent provided such successor is a Lender hereunder or
qualifies as an Eligible Assignee. Upon the acceptance of any appointment as an
Agent hereunder by a successor, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations as an Agent, as appropriate, under this Credit Agreement and the
other Credit Documents and the provisions of this Section 10.9 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Credit Agreement.
77
SECTION 11
MISCELLANEOUS
11.1 Notices. Except as otherwise expressly provided herein, all
notices and other communications shall have been duly given and shall be
effective (a) when delivered, (b) when transmitted via telecopy (or other
facsimile device) to the number set out below, (c) the Business Day following
the day on which the same has been delivered prepaid to a reputable national
overnight air courier service, or (d) the third Business Day following the day
on which the same is sent by certified or registered mail, postage prepaid, in
each case to the respective parties at the address or telecopy numbers set forth
on Schedule 11.1, or at such other address as such party may specify by written
notice to the other parties hereto.
11.2 Right of Set-Off. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence and during the continuance of an Event of
Default and the commencement of remedies described in Section 9.2, then, to the
extent permitted by applicable law, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation, branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party to the Lenders hereunder, under the Notes, or
the other Credit Documents, irrespective of whether the Administrative Agent or
the Lenders shall have made any demand hereunder and although such obligations,
liabilities or claims, or any of them, may be contingent or unmatured, and any
such set-off shall be deemed to have been made immediately upon the occurrence
of an Event of Default even though such charge is made or entered on the books
of such Lender subsequent thereto; provided that promptly following any such
set-off, such Lender will provide written notice thereof to the Borrower.
11.3 Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests (except as
permitted by Section 8.4 or 8.5) without the prior written consent of
the Lenders; and provided further that the rights of each Lender to
transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth below in
subsections (b) and (c) of this Section 11.3. Notwithstanding the above
(including anything set forth in subsections (b) and (c) of this
Section 11.3), nothing herein shall restrict, prevent or prohibit any
Lender from (A) pledging its Loans hereunder to a Federal Reserve Bank
in support of borrowings made by such Lender from such Federal Reserve
Bank, or (B) granting assignments or participations in such Lender's
Loans and/or Commitments hereunder to its parent company and/or to any
Affiliate of such Lender (provided that such parent company or
Affiliate qualifies as an Eligible Assignee) or to any existing Lender;
provided that, as of the date of such assignment or participation, such
assignee or participant shall not be entitled
78
to receive a greater payment under Section 3.13 than the assigning or
participating Lender would be entitled to receive.
(b) Assignments. In addition to the assignments permitted by
Section 11.3(a), each Lender may, with the prior written consent of the
Borrower and the Administrative Agent (provided that no consent of the
Borrower shall be required during the existence and continuation of an
Event of Default), which consent shall not be unreasonably withheld or
delayed, assign all or a portion of its rights and obligations
hereunder pursuant to an assignment agreement substantially in the form
of Exhibit 11.3 to one or more Eligible Assignees; provided that (i)
any such assignment shall be in a minimum aggregate amount of
$10,000,000 of the Commitments and in integral multiples of $1,000,000
above such amount (or the remaining amount of Commitments held by such
Lender), (ii) each such assignment shall be of a constant, not varying,
percentage of all of the assigning Lender's rights and obligations
under the Commitment being assigned. Any assignment hereunder
(including, but not limited to, any assignment by a Lender to another
Lender) shall be effective upon satisfaction of the conditions set
forth above and delivery to the Administrative Agent of a duly executed
assignment agreement, in substantially the form of Exhibit 11.3,
together with a transfer fee of $3,500 payable to the Administrative
Agent for its own account, (iii) each such assignment made as a result
of a demand by the Borrower pursuant to Section 11.3(d) shall be
arranged by the Borrower after consultation with the Agents and shall
be either an assignment of all of the rights and obligations of the
assigning Lender under this Credit Agreement or an assignment of a
portion of such rights and obligations made concurrently with another
such assignment or other such assignments that together cover all of
the rights and obligations of the assigning Lender under this Credit
Agreement or an assignment of a portion of such rights and obligations
made concurrently with another such assignment or other such
assignments that together cover all of the rights and obligations of
the assigning Lender under this Credit Agreement, (iv) no Lender shall
be obligated to make any such assignment as a result of a demand by the
Borrower pursuant to Section 11.3(d) unless and until such Lender shall
have received one or more payments from either the Borrower or one or
more Eligible Assignees in an aggregate amount at least equal to the
aggregate outstanding principal amount of the Revolving Loans owing to
such Lender, together with accrued interest thereon, to the date of
payment of such principal amount and all other amounts payable to such
lender under this Credit Agreement and (v) the Borrower shall be
entitled to withhold its consent if an assignment would result in
greater payments under Sections 3.9, 3.11, or 3.13. Upon the
effectiveness of any such assignment, the assignee shall become a
"Lender" for all purposes of this Credit Agreement and the other Credit
Documents and, to the extent of such assignment, the assigning Lender
shall be relieved of its obligations hereunder to the extent of the
Loans and Commitment components being assigned. Along such lines the
Borrower agrees that upon notice of any such assignment and surrender
of the appropriate Note or Notes, it will promptly provide to the
assigning Lender and to the assignee separate promissory notes in the
amount of their respective interests substantially in the form of the
original Note or Notes (but with notation thereon that it is given in
substitution for and replacement of the original Note or Notes or any
replacement notes thereof).
79
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants
that it is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim and the assignee
warrants that it is an Eligible Assignee; (ii) except as set forth in
clause (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution,
legality, validity, enforceability, genuineness, sufficiency or value
of this Credit Agreement, any of the other Credit Documents or any
other instrument or document furnished pursuant hereto or thereto or
the financial condition of any Credit Party or the performance or
observance by any Credit Party of any of its obligations under this
Credit Agreement, any of the other Credit Documents or any other
instrument or document furnished pursuant hereto or thereto; (iii) such
assignee represents and warrants that it is legally authorized to enter
into such assignment agreement; (iv) such assignee confirms that it has
received a copy of this Credit Agreement, the other Credit Documents
and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into such
assignment agreement; (v) such assignee will independently and without
reliance upon the Agents, such assigning Lender or any other Lender,
and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Credit Agreement and the other
Credit Documents; (vi) such assignee appoints and authorizes the Agents
to take such action on its behalf and to exercise such powers under
this Credit Agreement or any other Credit Document as are delegated to
the Agents by the terms hereof or thereof, together with such powers as
are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all the obligations
which by the terms of this Credit Agreement and the other Credit
Documents are required to be performed by it as a Lender.
(c) Participations. Each Lender may sell, transfer, grant or
assign participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under this Credit Agreement (such
selling Lender's obligations under the Credit Documents remaining
unchanged) and the participant shall not constitute a Lender hereunder,
(ii) no such participant shall have, or be granted, rights to approve
any amendment or waiver relating to this Credit Agreement or the other
Credit Documents except to the extent any such amendment or waiver
would (A) reduce the principal of or rate of interest on or fees in
respect of any Loans in which the participant is participating or
increase any Commitments with respect thereto, (B) postpone the date
fixed for any payment of principal (including the extension of the
final maturity of any Loan or the date of any mandatory prepayment),
interest or fees in which the participant is participating, or (C)
release all or substantially all of the collateral or guaranties
(except as expressly provided in the Credit Documents) supporting any
of the Loans or Commitments in which the participant is participating,
(iii) sub-participations by the participant (except to an Affiliate,
parent company or Affiliate of a parent company of the participant)
shall be prohibited and (iv) any such participations shall be in a
minimum
80
aggregate amount of $10,000,000 of the Commitments and in integral
multiples of $1,000,000 in excess thereof. In the case of any such
participation, the participant shall not have any rights under this
Credit Agreement or the other Credit Documents (the participant's
rights against the selling Lender in respect of such participation to
be those set forth in the participation agreement with such Lender
creating such participation) and all amounts payable by the Borrower
hereunder shall be determined as if such Lender had not sold such
participation; provided, however, that such participant shall be
entitled to receive additional amounts under Sections 3.9, 3.12, 3.13
and 3.14 to the same extent that the Lender from which such participant
acquired its participation would be entitled to the benefit of such
cost protection provisions.
(d) Each Lender grants (i) to the Agents the right to purchase
all (but not less than all) of such Lender's Commitments and Revolving
Loans owning to it and the Notes held by it and all of its rights and
obligations hereunder and under the other Credit Documents at a price
equal to the aggregate amount of outstanding Revolving Loans owed to
such Lender (together with all accrued and unpaid interest and fees and
other amounts owing to such Lender), and (ii) to the Borrower the right
to cause an assignment of all (but not less than all) of such Lender's
Commitment and Revolving Loans owing to it and the Notes held by it and
all of its rights and obligations hereunder and under the other Credit
Documents, which right may be exercised by the Agents or the Borrower,
as the case may be, if (A) such Lender refuses to execute any
amendment, waiver or consent which requires the written consent of all
of the Lenders and to which the Required Lenders, the Agents and the
Borrower have agreed, (B) such Lender has delivered a notice or
certificate pursuant to Section 3.9 or 3.11 or if the Borrower in
connection therewith or for any other reason is required to deduct or
withhold any tax, levy, impost, charge, assessment or similar item from
any amount payable to or for such Lender hereunder, (C) the Borrower
has knowledge or facts, events or circumstances which are reasonably
likely to entitle such Lender to deliver a certificate pursuant to
Section 3.9 or 3.11 and such Lender is unwilling or unable to take
action to eliminate or avoid its delivery of such a certificate, (D)
any Non-Excluded Taxes have been or are reasonably likely to be imposed
on such Lender, (E) such Lender is unable or unwilling to complete or
deliver any form required to be delivered by it pursuant to Section
3.13, (F) such Lender has received or is reasonably likely to receive a
notice or written communication as described in Section 3.13(f), (G)
such Lender shall have become subject to any receivership,
conservatorship or other insolvency proceeding, (H) the Eurocurrency
Reserve Percentage with respect to such Lender's Eurocurrency Loans is,
or would be reasonably likely to become with any incurrence of
Eurocurrency Loans, greater than zero, or (I) such Lender shall be a
Defaulting Lender. Each Lender agrees that if the Agents or the
Borrower, as the case may be, exercises its option hereunder, it shall
promptly execute and deliver all agreements and documentation necessary
to effectuate such assignment as set forth in Section 11.3(b).
11.4 No Waiver; Remedies Cumulative. No failure or delay on the part of
an Agent or any Lender in exercising any right, power or privilege hereunder or
under any other Credit Document and no course of dealing between the Borrower or
any Credit Party and the Agents or any Lender shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or privilege
hereunder or under any other Credit Document preclude any other or further
exercise
81
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Agents or any Lender would
otherwise have. No notice to or demand on any Credit Party in any case shall
entitle any Credit Party to any other or further notice or demand in similar or
other circumstances or constitute a waiver of the rights of the Agents or the
Lenders to any other or further action in any circumstances without notice or
demand.
11.5 Payment of Expenses; Indemnification. The Credit Parties agree to:
(a) pay all reasonable out-of-pocket costs and expenses of (i) the Agents and
NationsBanc Capital Markets, Inc. ("NCMI") in connection with (A) the
negotiation, preparation, execution and delivery and administration of this
Credit Agreement and the other Credit Documents and the LOC Documents and the
documents and instruments referred to therein (including, without limitation,
the reasonable fees and expenses of Xxxxx & Xxx Xxxxx, special counsel to the
Agents and the fees and expenses of counsel for the Agents in connection with
collateral issues), and (B) any amendment, waiver or consent relating hereto and
thereto including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Credit Parties under this Credit Agreement and (ii)
the Agents and the Lenders in connection with (A) enforcement of the Credit
Documents and the documents and instruments referred to therein, including,
without limitation, in connection with any such enforcement, the reasonable fees
and disbursements of counsel for the Agents and each of the Lenders, and (B) any
bankruptcy or insolvency proceeding of the Borrower or a Material Subsidiary and
(b) indemnify each Agent, NCMI and each Lender, its officers, directors,
employees, representatives and agents from and hold each of them harmless
against any and all losses, liabilities, claims, damages or expenses incurred by
any of them as a result of, or arising out of, or in any way related to, or by
reason of, any investigation, litigation or other proceeding (whether or not any
Agent, NCMI or Lender is a party thereto) related to (i) the entering into
and/or performance of any Credit Document or any LOC Document or the use of
proceeds of any Loans (including other extensions of credit) hereunder or the
consummation of any other transactions contemplated in any Credit Document or
any LOC Document, including, without limitation, the reasonable fees and
disbursements of counsel and settlement costs incurred in connection with any
such investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses to the extent incurred by
reason of gross negligence or willful misconduct on the part of the Person to be
indemnified), (ii) any Environmental Claim and (iii) any claims for Non-Excluded
Taxes.
11.6 Amendments, Waivers and Consents. In order for any amendment,
change, waiver, discharge or termination of this Credit Agreement or any of the
other Credit Documents to be binding on the Lenders and the Credit Parties, such
amendment, change, waiver, discharge or termination must be in writing and
signed by the Required Lenders and the then Credit Parties; provided that to be
binding no such amendment, change, waiver, discharge or termination shall:
(a) extend the Revolving Loan Maturity Date without the
consent of all the Lenders, or postpone or extend the time for any
payment or prepayment of principal to any Lender without the consent of
such Lender;
82
(b) reduce the rate (other than as a result of waiving the
applicability of any post- default increase in interest rates) or
extend the time of payment of interest on any Loan made by or any fees
hereunder for the account of any Lender without the consent of such
Lender;
(c) reduce or waive the principal amount of any Loan made by
any Lender without the consent of such Lender;
(d) increase or extend the Commitment of a Lender over the
amount thereof in effect without the consent of such Lender (it being
understood and agreed that a waiver of any Default or Event of Default
or a waiver of any mandatory reduction in the Commitments shall not
constitute an increase in the Commitment of any Lender);
(e) except as otherwise permitted in this Credit Agreement or
the Collateral Documents, release the Borrower or substantially all of
the other Credit Parties from their respective obligations under the
Credit Documents or release all or substantially all of the collateral
pledged under the Collateral Documents without the consent of all the
Lenders;
(f) amend, modify or waive any provision of this Section or
Section 3.4(a), 3.4(b)(i), 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14,
9.1(a), 11.2, 11.3 or 11.5 without the consent of all the Lenders;
(g) reduce any percentage specified in, or otherwise modify,
the definition of Required Lenders without the consent of all the
Lenders; or
(h) consent to the assignment or transfer by the Borrower or
of any of its rights and obligations under (or in respect of) the
Credit Documents except as permitted under Section 8.4 without the
consent of all the Lenders.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans or the
Letters of Credit, and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions set
forth herein and (y) the Required Lenders may consent to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts. This Credit Agreement may be executed in any number
of counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument.
Delivery of an executed counterpart by telecopy shall be as effective as
delivery of a manually executed counterpart hereto and shall constitute a
representation that an original executed counterpart will be provided. It shall
not be necessary in making proof of this Credit Agreement to produce or account
for more than one such counterpart.
11.8 Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Credit Agreement.
83
11.9 Defaulting Lender. Each Lender understands and agrees that if such
Lender is a Defaulting Lender then notwithstanding the provisions of Section
11.6 it shall not be entitled to vote on any matter requiring the consent of the
Required Lenders or to object to any matter requiring the consent of all the
Lenders; provided, however, that all other benefits and obligations under the
Credit Documents shall apply to such Defaulting Lender.
11.10 Survival of Indemnification and Representations and Warranties.
All indemnities set forth herein and all representations and warranties made
herein shall survive the execution and delivery of this Credit Agreement, the
making of the Loans, the issuance of the Letters of Credit and the repayment of
the Loans, LOC Obligations and other obligations and the termination of the
Commitments hereunder. No representation or warranty made or deemed made as of
any date pursuant to any Section or subsection of this Credit Agreement or any
other Credit Document, or any other document, certificate or statement delivered
in connection therewith, shall be deemed by reason of this Section 11.10 to have
been made or deemed made as of any other date.
11.11 Governing Law. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
11.12 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE
OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
11.13 Time. All references to time herein shall be references to
Eastern Standard Time or Eastern Daylight time, as the case may be, unless
specified otherwise.
11.14 Severability. If any provision of any of the Credit Documents is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
11.15 Entirety. This Credit Agreement together with the other Credit
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
11.16 Binding Effect. This Credit Agreement shall become effective at
such time when all of the conditions set forth in Section 5.1 have been
satisfied or waived by the Lenders and it shall have been executed by the
Borrower, the Guarantors and the Agents, and the Agents shall have received
copies hereof (telefaxed or otherwise) which, when taken together, bear the
signatures of each Lender, and thereafter this Credit Agreement shall be binding
upon and inure to the benefit of the Borrower, the Guarantors, the Agents and
each Lender and their respective successors and assigns.
84
11.17 Confidentiality. Each Lender agrees that it will use its
reasonable best efforts to keep confidential and to cause any representative
designated under Section 7.11 to keep confidential any non-public information
from time to time supplied to it under any Credit Document; provided, however,
that nothing herein shall prevent the disclosure of any such information to (a)
the extent a Lender in good faith believes such disclosure is required by
Requirement of Law, (b) counsel for a Lender or to its accountants, (c) bank
examiners or auditors or comparable Persons, (d) any affiliate of a Lender, (e)
any other Lender, or any assignee, transferee or participant, or any potential
assignee, transferee or participant, of all or any portion of any Lender's
rights under this Agreement who is notified of the confidential nature of the
information or (f) any other Person in connection with any litigation to which
any one or more of the Lenders is a party; and provided further that no Lender
shall have any obligation under this Section 11.17 to the extent any such
information becomes available on a non-confidential basis from a source other
than a Credit Party or that any information becomes publicly available other
than by a breach of this Section 11.17.
85
Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER:
COVANCE INC.,
a Delaware corporation
By:_______________________________
Name:_____________________________
Title:____________________________
GUARANTORS: COVANCE CLINICAL AND PERIAPPROVAL
SERVICES, INC.
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE PHARMACEUTICAL PACKAGING
SERVICES, INC.
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE LABORATORIES INC.
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE RESEARCH PRODUCTS INC.
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE CENTRAL LABORATORY SERVICES
LIMITED PARTNERSHIP
By CORNING SCICOR, INC., a corporation, its
General Partner
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE PRECLINICAL CORPORATION
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
COVANCE CENTRAL LABORATORY SERVICES,INC.
a corporation
By:_______________________________
Name:_____________________________
Title:____________________________
LENDERS:
NATIONSBANK, N.A.,
individually in its capacity as a
Lender and in its capacity as Administrative Agent
By:________________________________
Name:______________________________
Title:_____________________________
WACHOVIA BANK OF GEORGIA, N.A.,
individually in its capacity as a Lender and in
its capacity as Syndication Agent
By:________________________________
Name:______________________________
Title:_____________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
BANK OF MONTREAL
By:______________________________
Name:____________________________
Title:___________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
FUJI BANK LTD.
By:_______________________________
Name:_____________________________
Title:____________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By:______________________________
Name:____________________________
Title:___________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
THE BANK OF NOVA SCOTIA
By:_______________________________
Name:_____________________________
Title:____________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
BANQUE PARIBAS
By:________________________________
Name:______________________________
Title:_____________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
BARCLAYS BANK PLC
By:______________________________
Name:____________________________
Title:___________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
THE CHASE MANHATTAN BANK
By:_____________________________
Name:___________________________
Title:__________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
CREDIT SUISSE
By:_____________________________
Name:___________________________
Title:__________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
THE DAI-ICHI KANGYO BANK, LTD.
By:____________________________
Name:__________________________
Title:_________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
FLEET NATIONAL BANK
By:_____________________________
Name:___________________________
Title:__________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By:_____________________________
Name:___________________________
Title:__________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
MELLON BANK, N.A.
By:____________________________
Name:__________________________
Title:_________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
PNC BANK, NATIONAL ASSOCIATION
By:_____________________________
Name:___________________________
Title:__________________________
Signature page to Credit Agreement, dated as of November 26, 1996, among Covance
Inc. as Borrower, certain Subsidiaries of Covance Inc. as Guarantors, the
lenders party thereto, NationsBank, N.A., as Administrative Agent and Wachovia
Bank of Georgia, N.A., as Syndication Agent.
THE SANWA BANK LTD
By:_____________________________
Name:___________________________
Title:__________________________
Exhibit 2.1(g)
to
Credit Agreement
FORM OF REVOLVING LOAN NOTE
, 199
FOR VALUE RECEIVED, COVANCE INC., a Delaware corporation (the "Borrower"),
hereby promises to pay to the order of (the "Lender"), at the office of
NationsBank, N.A. (the "Administrative Agent") as set forth in that certain
Credit Agreement dated as of , 1996 among the Borrower, certain of the
Subsidiaries of the Borrower, the Lenders named therein (including the Lender),
NationsBank, N.A., as Administrative Agent, and Wachovia Bank of Georgia, N.A.,
as Syndication Agent (as the same may be amended, modified, extended or restated
from time to time, the "Credit Agreement") or at such other place or places as
the holder of this Revolving Loan Note may designate), the aggregate principal
amount of all advances made by the Lender (in the respective currencies made) as
Revolving Loans (and not otherwise repaid), in lawful money (in the currency in
which the Revolving Loan was provided) and in immediately available funds, on
the dates and in the principal amounts provided in the Credit Agreement, and to
pay interest on the unpaid principal amount of each Revolving Loan made by the
Lender, at such office, in like money and funds, for the period commencing on
the date of each Revolving Loan until each Revolving Loan shall be paid in full,
at the rates per annum and on the dates provided in the Credit Agreement.
This Note is one of the Revolving Loan Notes referred to in the Credit
Agreement and evidences Revolving Loans made by the Lender thereunder. The
Lender shall be entitled to the benefits of the Credit Agreement. Capitalized
terms used in this Revolving Loan Note have the respective meanings assigned to
them in the Credit Agreement and the terms and conditions of the Credit
Agreement are expressly incorporated herein and made a part hereof.
The Credit Agreement provides for the acceleration of the maturity of
the Revolving Loans evidenced by this Revolving Loan Note upon the occurrence of
certain events (and for payment of collection costs in connection therewith) and
for prepayments of Revolving Loans upon the terms and conditions specified
therein. In the event this Revolving Loan Note is not paid when due at any
stated or accelerated maturity, the Borrower agrees to pay, in addition to the
principal and interest, all costs of collection, including reasonable attorney
fees.
Except as permitted by Section 11.3(b) of the Credit Agreement, this
Revolving Loan Note may not be assigned by the Lender to any other Person.
The date, amount, type, currency, interest rate and duration of
Interest Period (if applicable) of each Revolving Loan made by the Lender to the
Borrower, and each payment made on account of the principal thereof, shall be
recorded by the Administrative Agent on its books; provided that the failure of
the Administrative Agent to make any such recordation shall not affect the
obligations of the Borrower to make a payment when due of any amount owing
hereunder or under this Revolving Loan Note in respect of the Revolving Loans to
be evidenced
by this Revolving Loan Note, and each such recordation shall be prima facie
evidence of the obligations owing under this Revolving Loan Note absent manifest
error.
THIS REVOLVING LOAN NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed as
of the date first above written.
COVANCE INC.
By:_______________________________
Name:_____________________________
Title:____________________________
