$120,000,000
CREDIT AGREEMENT
DATED AS OF JUNE 17, 1999
AMONG
FALCON PRODUCTS, INC.,
as Borrower,
THE LENDERS LISTED HEREIN,
as Lenders,
FIRST UNION NATIONAL BANK,
as Syndication Agent,
NATIONSBANK, N.A.,
as Documentation Agent,
and
DLJ CAPITAL FUNDING, INC.,
as Administrative Agent
LEAD ARRANGER and BOOK RUNNER:
DLJ CAPITAL FUNDING, INC.
$120,000,000
FALCON PRODUCTS, INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
SECTION 1. DEFINITIONS................................................2
1.1 Defined Terms..............................................2
1.2 Accounting Terms; Utilization of GAAP for Purposes
of Calculations Under Agreement...........................31
1.3 Other Definitional Provisions and Rules of
Construction..............................................32
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS................32
2.1 Commitments; Making of Loans; Notes.......................32
2.2 Interest on the Loans.....................................40
2.3 Fees......................................................43
2.4 Repayments, Prepayments and Reductions in Loan
Commitments; General Provisions Regarding Payments........44
2.5 Use of Proceeds...........................................54
2.6 Special Provisions Governing LIBO Rate Loans..............54
2.7 Increased Costs; Taxes; Capital Adequacy..................56
2.8 Obligation of Lenders and Issuing Lenders to
Mitigate; Replacement of Lender...........................60
SECTION 3. LETTERS OF CREDIT.........................................62
3.1 Issuance of Letters of Credit and Lenders'
Purchase of Participations Therein........................62
3.2 Letter of Credit Fees.....................................65
3.3 Drawings and Reimbursement of Amounts
Paid Under Letters of Credit..............................66
3.4 Obligations Absolute......................................69
3.5 Indemnification; Nature of Issuing Lenders' Duties........70
3.6 Increased Costs and Taxes Relating to Letters of Credit...71
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT.................72
4.1 Conditions to Initial Loans...............................72
4.2 Conditions to Loans Made on Merger Date...................83
4.3 Conditions to All Loans...................................88
4.4 Conditions to Letters of Credit...........................89
SECTION 5. COMPANY'S REPRESENTATIONS AND WARRANTIES..................90
5.1 Organization, Powers, Qualification,
Good Standing, Business and Subsidiaries..................90
5.2 Authorization of Borrowing, etc...........................91
5.3 Financial Condition.......................................92
5.4 No Material Adverse Change; No Restricted
Junior Payments...........................................92
5.5 Title to Properties; Liens; Real Property.................93
5.6 Litigation; Adverse Facts.................................93
5.7 Payment of Taxes..........................................94
5.8 Performance of Agreements; Materially Adverse
Agreements................................................94
5.9 Governmental Regulation....................................94
5.10 Securities Activities......................................94
5.11 Employee Benefit Plans.....................................95
5.12 Certain Fees...............................................96
5.13 Environmental Protection...................................96
5.14 Employee Matters...........................................97
5.15 Solvency...................................................97
5.16 Matters Relating to Collateral.............................97
5.17 Related Agreements.........................................98
5.18 Disclosure.................................................98
5.19 Year 2000 Compliance.......................................99
SECTION 6. COMPANY'S AFFIRMATIVE COVENANTS............................99
6.1 Financial Statements and Other Reports.....................99
6.2 Legal Existence, etc......................................104
6.3 Payment of Taxes and Claims; Tax Consolidation............104
6.4 Maintenance of Properties; Insurance; Application
of Net Insurance/Condemnation Proceeds....................105
6.5 Inspection Rights; Lender Meeting.........................107
6.6 Compliance with Laws, etc.................................107
6.7 Environmental Review and Investigation,
Disclosure, Etc.; Company's Actions Regarding
Hazardous Materials Activities, Environmental
Claims and Violations of Environmental Laws...............108
6.8 Execution of Subsidiary Guaranty and Personal
Property Collateral Documents by Certain
Subsidiaries and Future Subsidiaries; IP Collateral.......110
6.9 Leasehold Properties; Matters Relating to Additional
Real Property Collateral; Certain
Opinions; Removal of Liens................................112
6.10 Merger....................................................116
6.11 Interest Rate Protection..................................116
6.12 Year 2000 Compliance......................................116
SECTION 7. COMPANY'S NEGATIVE COVENANTS..............................116
7.1 Indebtedness..............................................116
7.2 Liens and Related Matters.................................118
7.3 Investments; Joint Ventures...............................119
7.4 Contingent Obligations....................................120
7.5 Restricted Junior Payments................................121
7.6 Financial Covenants.......................................121
7.7 Restriction on Fundamental Changes; Asset Sales
and Acquisitions..........................................123
7.8 Consolidated Capital Expenditures.........................125
7.9 Sales and Lease-Backs.....................................126
7.10 Sale or Discount of Receivables...........................127
7.11 Transactions with Stockholders and Affiliates.............127
7.12 Disposal of Subsidiary Equity.............................127
7.13 Conduct of Business.......................................128
7.14 Amendments or Waivers of Related Agreements...............128
7.15 Fiscal Year...............................................128
SECTION 8. EVENTS OF DEFAULT.........................................128
8.1 Failure to Make Payments When Due.........................129
8.2 Default in Other Agreements...............................129
8.3 Breach of Certain Covenants...............................129
8.4 Breach of Warranty........................................129
8.5 Other Defaults Under Loan Documents.......................129
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc......130
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc........130
8.8 Judgments and Attachments.................................130
8.9 Dissolution...............................................131
8.10 Employee Benefit Plans....................................131
8.11 Change in Control.........................................131
8.12 Invalidity of Guaranties; Failure of Security;
Repudiation of Obligations................................131
8.13 Mergers...................................................131
SECTION 9. THE AGENTS................................................132
9.1 Appointment...............................................132
9.2 Powers and Duties; General Immunity.......................134
9.3 Representations and Warranties; No Responsibility
For Appraisal of Creditworthiness.........................135
9.4 Right to Indemnity........................................135
9.5 Successor Agents and Swing Line Lender....................136
9.6 Collateral Documents and Guaranties.......................137
SECTION 10. MISCELLANEOUS.............................................137
10.1 Assignments and Participations in Loans
and Letters of Credit.....................................137
10.2 Expenses..................................................140
10.3 Indemnity.................................................141
10.4 Set-Off; Security Interest in Deposit Accounts............142
10.5 Ratable Sharing...........................................142
10.6 Amendments and Waivers....................................143
10.7 Independence of Covenants.................................145
10.8 Notices...................................................145
10.9 Survival of Representations, Warranties and Agreements....145
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.....146
10.11 Marshalling; Payments Set Aside...........................146
10.12 Severability..............................................146
10.13 Obligations Several; Independent Nature of
Lenders' Rights...........................................146
10.14 Headings..................................................147
10.15 Applicable Law............................................147
10.16 Successors and Assigns....................................147
10.17 Consent to Jurisdiction and Service of Process............147
10.18 Waiver of Jury Trial......................................148
10.19 Confidentiality...........................................148
10.20 Counterparts; Effectiveness...............................149
Signature pages ........................................................... S-1
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF REQUEST FOR ISSUANCE OF LETTER OF CREDIT
IV-A FORM OF TRANCHE A TERM NOTE
IV-B FORM OF REVOLVING NOTE
IV-C FORM OF SWING LINE NOTE
V FORM OF COMPLIANCE CERTIFICATE
VI FORM OF FINANCIAL CONDITION CERTIFICATE
VII FORM OF CLOSING DATE OPINION OF COMPANY'S COUNSEL
VIII FORM OF MERGER DATE OPINION OF COMPANY'S COUNSEL
IX FORM OF OPINION OF O'MELVENY & XXXXX LLP
X FORM OF ASSIGNMENT AGREEMENT
XI FORM OF CERTIFICATE RE NON-BANK STATUS
XII FORM OF COLLATERAL ACCOUNT AGREEMENT
XIII FORM OF PLEDGE AGREEMENT
XIV FORM OF SECURITY AGREEMENT
XV FORM OF SUBSIDIARY GUARANTY
XVI FORM OF SUBSIDIARY PLEDGE AGREEMENT
XVII FORM OF SUBSIDIARY SECURITY AGREEMENT
SCHEDULES
1.1 FISCAL QUARTERS
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES
5.1 SUBSIDIARIES OF COMPANY
5.5 REAL PROPERTY
5.6 LITIGATION
5.7 TAXES
5.13 ENVIRONMENTAL MATTERS
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
$120,000,000
FALCON PRODUCTS, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of June 17, 1999, and entered into by
and among FALCON PRODUCTS, INC., a Delaware corporation ("Company"), THE LENDERS
LISTED ON THE SIGNATURE PAGES HEREOF (each individually referred to herein as a
"Lender" and collectively as "Lenders"), DLJ CAPITAL FUNDING, INC. ("DLJ"), as
administrative agent for Lenders (in such capacity, "Administrative Agent"),
FIRST UNION NATIONAL BANK, as syndication agent for Lenders (in such capacity,
"Syndication Agent") and NATIONSBANK, N.A., as documentation agent for Lenders
(in such capacity, "Documentation Agent").
R E C I T A L S
WHEREAS, Company (capitalized terms used herein without definition
shall have the meanings set forth therefor in subsection 1.1 of this Agreement)
has formed Acquisition Co. for the purpose of tendering for the purchase of all
the outstanding Shelby Common Stock and to acquire in the Merger any Shelby
Common Stock not so purchased in the Tender Offer at the Tender Offer Price;
WHEREAS, as soon as practical after the consummation of the Tender
Offer, Acquisition Co. and Shelby will consummate the Merger with the effect
that Company will own not less than 100% of the Shelby Common Stock;
WHEREAS, Lenders have agreed to extend certain credit facilities to
Company to be used for the purposes of providing funds for (i) the Acquisition
Financing Requirements and (ii) working capital and other general purposes of
Company and its Subsidiaries, and issuing Letters of Credit for the purposes set
forth herein;
WHEREAS, on the Closing Date, Company will secure all of the
Obligations hereunder and under the other Loan Documents by granting to
Administrative Agent, on behalf of Lenders, a First Priority Lien on
substantially all of its personal, real and mixed property, including a pledge
of all of the capital stock of its existing Domestic Subsidiaries and a pledge
of 66% of the capital stock of its existing Foreign Subsidiaries (other than
Inactive Subsidiaries);
WHEREAS, on the Closing Date, all of Company's existing Domestic
Subsidiaries will guarantee the Obligations hereunder and under the other Loan
Documents and each of such existing Domestic Subsidiaries will secure its
guaranty by granting to Administrative Agent, on behalf of Lenders, a First
Priority Lien on substantially all of its respective personal, real and mixed
property, including a pledge of all of the capital stock of each of its existing
Domestic Subsidiaries and 66% of the capital stock of each of its existing
Foreign Subsidiaries (other than Inactive Subsidiaries);
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Company, Lenders, Syndication Agent,
Documentation Agent and Administrative Agent agree as follows:
Section 1. DEFINITIONS
1.1 Defined Terms
The following terms used in this Agreement shall have the following
meanings:
"Acquired Business" has the meaning assigned thereto in subsection
7.7(vii).
"Acquisition Co." means SY Acquisition, Inc., a Delaware corporation
and wholly-owned subsidiary of Company.
"Acquisition Financing Requirements" means the aggregate of all amounts
necessary (i) to finance the purchase price for all of the outstanding shares of
Shelby Common Stock (and the retirement of all outstanding stock options)
pursuant to the Tender Offer and the Merger in an aggregate amount of
approximately $148.3 million, (ii) to repay in full certain of the Existing
Company Indebtedness in an amount of approximately $20.0 million plus accrued
interest and fees thereon and (iii) to pay Transaction Costs in an amount not to
exceed $10.5 million.
"Adjusted LIBO Rate" means, for any Interest Rate Determination Date
with respect to an Interest Period for a LIBO Rate Loan, the rate per annum
obtained by dividing (i) the rate per annum (rounded upward to the nearest 1/16
of one percent) which appears on the British Bankers Association Telerate page
3750 (or such other comparable page as may, in the opinion of the Administrative
Agent, replace such page for the purpose of displaying such rate), at which
Dollar deposits with a maturity comparable to such Interest Period as of
approximately 11:00 a.m. (London time) on such Interest Rate Determination Date
by (ii) a percentage equal to 100% minus the stated maximum rate of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable on such Interest Rate Determination Date to any member bank
of the Federal Reserve System in respect of "Eurocurrency liabilities" as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"Administrative Agent" has the meaning assigned to that term in the
introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"Affected Lender" has the meaning assigned to that term in subsection
2.6C.
"Affiliate", as applied to any Person, means any other Person directly
or indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.
"Affiliated Fund" means, with respect to any Lender that is a fund that
invests (in whole or in part) in commercial loans, any other fund that invests
(in whole or in part) in commercial loans and is managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.
"Agents" means, collectively, the Syndication Agent, the Documentation
Agent and the Administrative Agent.
"Agreement" means this Credit Agreement dated as of June 17, 1999, as
it may be amended, supplemented or otherwise modified from time to time.
"Annualized" means (i) with respect to the Fiscal Quarter of Company
ending on or about October 31, 1999, the applicable amount for such Fiscal
Quarter multiplied by four, (ii) with respect to the Fiscal Quarter of Company
ending on or about January 31, 2000, the applicable amount for such Fiscal
Quarter and the immediately preceding Fiscal Quarter multiplied by two, and
(iii) with respect to the Fiscal Quarter of Company ending on or about April 30,
2000, the applicable amount for such Fiscal Quarter and the immediately
preceding two Fiscal Quarters multiplied by one and one-third.
"Applicable Base Rate Margin" means, as at any date of determination, a
percentage per annum as set forth below opposite the applicable Consolidated
Leverage Ratio calculated on a Pro Forma Basis:
Consolidated Leverage Ratio Applicable Base Rate Margin
----------------------------------------------------------------------------
greater than 4.00:1.00 1.50%
less than or equal to 4.00:1.00 1.25%
but greater than 3.50:1.00
less than or equal to 3.50:1.00 1.00%
but greater than 3.00:1.00
less than or equal to 3.00:1.00 0.75%
; provided that until the delivery of the first Margin Determination Certificate
by Company to Administrative Agent pursuant to subsection 6.1 (xvii) after the
six-month anniversary of the Closing Date, the Applicable Base Rate Margin for
Tranche A Term Loans and Revolving Loans that are Base Rate Loans shall be 1.50%
per annum.
"Applicable LIBO Rate Margin" means, as at any date of determination, a
percentage per annum as set forth below opposite the applicable Consolidated
Leverage Ratio calculated on a Pro Forma Basis:
Consolidated Leverage Ratio Applicable LIBO Rate Margin
----------------------------------------------------------------------------
greater than 4.00:1.00 2.50%
less than or equal to 4.00:1.00 2.25%
but greater than 3.50:1.00
less than or equal to 3.50:1.00 2.00%
but greater than 3.00:1.00
less than or equal to 3.00:1.00 1.75%
; provided that until the delivery of the first Margin Determination Certificate
by Company to Administrative Agent pursuant to subsection 6.1 (xvii) after the
six-month anniversary of the Closing Date, the Applicable LIBO Rate Margin for
Tranche A Term Loans and Revolving Loans that are LIBO Rate Loans shall be 2.50%
per annum.
"Arranger" means DLJ Capital Funding, Inc. as Sole Lead Arranger and
Book Runner.
"Asset Sale" means the sale, lease, assignment or other transfer
(whether voluntary or involuntary) for value (collectively, a "transfer") by
Company or any of its Subsidiaries to any Person other than Company or any of
its wholly-owned Subsidiaries of (i) any of the equity ownership of any of
Company's Subsidiaries, (ii) substantially all of the assets of any division or
line of business of Company or any of its Subsidiaries, or (iii) any other
assets (whether tangible or intangible) of Company or any of its Subsidiaries
(other than (a) inventory sold in the ordinary course of business, (b) obsolete
equipment transferred for not in excess of $1 million for any single transaction
or related series of transactions and $2 million in the aggregate for each
Fiscal Year, and (c) any such other assets to the extent that (x) the aggregate
value of such assets transferred in any single transaction or related series of
transactions is equal to $250,000 or less and (y) the aggregate value of such
assets transferred in any Fiscal Year is equal to $500,000 or less).
"Assignment Agreement" means an Assignment Agreement in substantially
the form of Exhibit X annexed hereto.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute.
"Base Rate" means, at any time, the higher of (x) the Prime Rate or (y)
the rate which is 1/2 of 1% in excess of the Federal Funds Effective Rate.
"Base Rate Loans" means Loans bearing interest at rates determined by
reference to the Base Rate as provided in subsection 2.2A.
"Business Day" means (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which is a
legal holiday under the laws of the State of New York or the State of Missouri
or is a day on which banking institutions located in such state are authorized
or required by law or other governmental action to close, and (ii) with respect
to all notices, determinations, fundings and payments in connection with the
Adjusted LIBO Rate or any LIBO Rate Loans, any day that is a Business Day
described in clause (i) above and that is also a day for trading by and between
banks in Dollar deposits in the London interbank market.
"Capital Lease", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"Cash" means money, currency or a credit balance in a demand, time,
savings, passbook or like account with a bank, savings and loan association,
credit union or like organization, other than an account evidenced by a
negotiable certificate of deposit.
"Cash Equivalents" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) 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, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, the highest rating
obtainable from either Standard & Poor's Ratings Group ("S&P") or Xxxxx'x
Investors Service, Inc. ("Moody's"); (iii) commercial paper maturing no more
than one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from
Moody's; (iv) certificates of deposit or bankers' acceptances maturing within
one year after such date and issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that (a) is at least "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100 million; and (v) shares of any money market mutual fund that (a)
invests solely in the types of investments referred to in clauses (i) through
(iv) above or in substantially similar investments and (b) has a rating of no
less than "AAA" from Moody's and equivalent rating from S&P.
"Certificate re Non-Bank Status" means a certificate substantially in
the form of Exhibit XI annexed hereto delivered by a Lender to Administrative
Agent pursuant to subsection 2.7B(iii).
"Change in Control" means:
(i) a change shall occur in the Board of Directors of Company
so that a majority of the Board of Directors of Company ceases to
consist of the individuals who constituted the Board of Directors of
Company on the Closing Date (or individuals whose election or
nomination for election was approved by a vote of at least 75% of the
directors then in office who either were directors on the Closing Date
or whose election or nomination for election was previously so
approved); or
(ii) any Person or group (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission) shall become or be the owner,
directly or indirectly, beneficially or of record, of shares
representing more than 30% of the aggregate ordinary voting power
represented by the issued and outstanding capital stock of Company on a
fully diluted basis; or
(iii) a "Change of Control" occurs as that term is defined in
the Senior Subordinated Debt Indenture.
"Closing Date" means the date on which the initial Loans are made.
"Collateral" means, collectively, all of the real, personal and mixed
property (including capital stock) in which Liens are purported to be granted
pursuant to the Collateral Documents as security for the Obligations.
"Collateral Account Agreement" means the Collateral Account Agreement
executed and delivered by Company and Administrative Agent on the Closing Date,
substantially in the form of Exhibit XII annexed hereto, as such Collateral
Account Agreement may hereafter be amended, supplemented or otherwise modified
from time to time.
"Collateral Documents" means any Collateral Account Agreement, Pledge
Agreement, Security Agreement, Subsidiary Pledge Agreement, Subsidiary Security
Agreement or Mortgage executed by Company or any of Company's Subsidiaries and
granting a Lien on any real, personal or mixed property of such Person to secure
the Obligations and all other instruments or documents delivered by any Loan
Party pursuant to this Agreement or any of the other Loan Documents in order to
grant to Administrative Agent, on behalf of Lenders, a Lien on any real,
personal or mixed property of that Loan Party as security for the Obligations.
"Commercial Letter of Credit" means any letter of credit or similar
instrument issued for the purpose of providing the primary payment mechanism in
connection with the purchase of any materials, goods or services of Company or
any of its Subsidiaries in the ordinary course of business of Company or such
Subsidiary.
"Commitment Fee Percentage" means 0.50% per annum.
"Commitments" means the commitments of Lenders to make Loans as set
forth in subsection 2.1A.
"Company" has the meaning assigned to that term in the introduction to
this Agreement.
"Company Employee Benefit Plan" means any Employee Benefit Plan which
is maintained or contributed to by Company or any of its Subsidiaries.
"Company Pension Plan" means any Pension Plan which is a Company
Employee Benefit Plan.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit V annexed hereto delivered to Agents and Lenders by Company pursuant
to subsection 6.1(iii).
"Computation Date" has the meaning assigned to that term in subsection
2.1F(i).
"Conforming Leasehold Interest" means any Recorded Leasehold Interest
as to which the lessor (and all other parties having a consent right) has agreed
in writing for the benefit of Administrative Agent (which writing has been
delivered to Administrative Agent), whether under the terms of the applicable
lease, under the terms of a Landlord Consent and Estoppel, or otherwise, to the
matters described in the definition of "Landlord Consent and Estoppel," which
interest, if a subleasehold or sub-subleasehold interest, is not subject to any
contrary restrictions contained in a superior lease or sublease.
"Consolidated Capital Expenditures" means, for any period, the sum of
the aggregate of all expenditures (whether paid in cash or other consideration
or accrued as a liability and including that portion of Capital Leases which is
capitalized on the consolidated balance sheet of Company and its Subsidiaries)
by Company and its Subsidiaries during that period that, in conformity with
GAAP, are included in "additions to property, plant or equipment" or comparable
items reflected in the consolidated statement of cash flows of Company and its
Subsidiaries.
"Consolidated Cash Interest Expense" means, for any period,
Consolidated Interest Expense for such period excluding, however, any interest
expense not payable in Cash (including amortization of discount and amortization
of debt issuance costs).
"Consolidated Current Assets" means, as at any date of determination,
the total assets of Company and its Subsidiaries on a consolidated basis which
may properly be classified as current assets in conformity with GAAP, but
excluding Cash and Cash Equivalents.
"Consolidated Current Liabilities" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current liabilities in
conformity with GAAP, but excluding the Revolving Loans and the current portion
of long term Indebtedness of Company (including the Term Loans).
"Consolidated EBITDA" means, for any period, the sum of the amounts for
such period of (i) Consolidated Net Income, (ii) Consolidated Interest Expense,
(iii) provisions for taxes based on income, (iv) total depreciation expense, (v)
total amortization expense (including without limitation any amounts referred to
in subsection 2.3 payable to Arranger, Agents and Lenders on or before the
Closing Date) and (vi) other non-cash items reducing Consolidated Net Income
less other non-cash items increasing Consolidated Net Income, all of the
foregoing as determined on a consolidated basis for Company and its Subsidiaries
in conformity with GAAP; provided that all calculations of Consolidated EBITDA
for any period that ends prior to the Merger Date or that includes the Merger
Date shall be made on a Pro Forma Basis assuming the Tender Offer and the Merger
were consummated on the first day of such period.
"Consolidated Excess Cash Flow" means, for any period, an amount (if
positive) equal to (i) the sum, without duplication, of the amounts for such
period of (a) Consolidated EBITDA and (b) the Consolidated Working Capital
Adjustment minus (ii) the sum, without duplication, of the amounts for such
period of (a) voluntary and scheduled repayments of Consolidated Total Debt
(excluding repayments of Revolving Loans except to the extent the Revolving Loan
Commitments are permanently reduced in connection with such repayments), (b)
Consolidated Capital Expenditures (net of any proceeds of any related financings
with respect to such expenditures), (c) amounts expended on Permitted
Acquisitions, (d) Consolidated Cash Interest Expense, (e) the consolidated
provision for current taxes based on income of Company and its Subsidiaries and
payable in cash with respect to such period and (f) dividends paid in cash.
"Consolidated Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio computed for the four Fiscal Quarter period most
recently ended on or before such date of determination of Consolidated EBITDA to
Consolidated Fixed Charges; provided that with respect to Consolidated Fixed
Charges for the Fiscal Quarters ending on or about October 31, 1999, January 31,
2000 and April 30, 2000, the calculations of Consolidated Cash Interest Expense,
taxes and dividends paid in cash during such period shall be determined on an
Annualized basis.
"Consolidated Fixed Charges" means, for any period, the sum (without
duplication) of the amounts for such period of (i) Consolidated Cash Interest
Expense, (ii) all taxes paid in cash during such period, (iii) Consolidated
Capital Expenditures for such period paid in cash, (iv) the aggregate amount of
scheduled payments of principal on Indebtedness of Company and its Subsidiaries
(including that portion attributable to Capital Leases in accordance with GAAP)
for such period, and (v) the amount of Restricted Junior Payments paid in cash
during such period permitted under subsection 7.5, all of the foregoing as
determined on a consolidated basis for Company and its Subsidiaries in
conformity with GAAP.
"Consolidated Interest Expense" means, for any period, the sum of total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) of Company and its Subsidiaries
on a consolidated basis with respect to all outstanding Indebtedness of Company
and its Subsidiaries, including all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs under Interest Rate Agreements, but excluding, however, any
amounts referred to in subsection 2.3 payable to Arranger, Agents and Lenders on
or before the Closing Date.
"Consolidated Leverage Ratio" means, as at any date of determination,
the ratio of (a) Consolidated Total Debt as of the last day of the Fiscal
Quarter for which such determination is being made to (b) Consolidated EBITDA
for the consecutive four Fiscal Quarters ending on the last day of the Fiscal
Quarter for which such determination is being made.
"Consolidated Net Income" means, for any period, the net income (or
loss) of Company and its Subsidiaries on a consolidated basis for such period
taken as a single accounting period determined in conformity with GAAP; provided
that there shall be excluded (i) the income (or loss) of any Person (other than
a Subsidiary of Company) in which any other Person (other than Company or any of
its Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to Company or any of its
Subsidiaries by such Person during such period, (ii) except as otherwise
expressly permitted under this Agreement, the income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of Company or is merged into
or consolidated with Company or any of its Subsidiaries or that Person's assets
are acquired by Company or any of its Subsidiaries, (iii) the income of any
Subsidiary of Company to the extent that the declaration or payment of dividends
or similar distributions by that Subsidiary of that income is not at the time
permitted by operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation applicable to
that Subsidiary, (iv) any after-tax gains or losses attributable to Asset Sales
or returned surplus assets of any Pension Plan, and (v) (to the extent not
included in clauses (i) through (iv) above) any net extraordinary gains or net
non-cash extraordinary losses.
"Consolidated Net Worth" means, as of any date of determination, the
sum of the capital stock and additional paid-in capital plus retained earnings
(or minus accumulated deficits) of Company and its Subsidiaries determined on a
consolidated basis in accordance with GAAP.
"Consolidated Total Debt" means, as at any date of determination, the
aggregate stated balance sheet amount of all Indebtedness of Company and its
Subsidiaries determined on a consolidated basis in accordance with GAAP.
"Consolidated Working Capital" means, as at any date of determination,
the excess (or deficit) of Consolidated Current Assets over Consolidated Current
Liabilities.
"Consolidated Working Capital Adjustment" means, for any period on a
consolidated basis, the amount (which may be a negative number) by which
Consolidated Working Capital as of the beginning of such period exceeds (or is
less than) Consolidated Working Capital as of the end of such period.
"Contingent Obligation", as applied to any Person, means any direct or
indirect liability, contingent or otherwise, of that Person (i) with respect to
any Indebtedness, lease, dividend or other obligation of another if the primary
purpose or intent thereof by the Person incurring the Contingent Obligation is
to provide assurance to the obligee of such obligation of another that such
obligation of another will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect thereof, (ii)
with respect to any letter of credit issued for the account of that Person or as
to which that Person is otherwise liable for reimbursement of drawings, or (iii)
under Hedge Agreements. Contingent Obligations shall include (a) the direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the obligation of another, (b) the obligation to make
take-or-pay or similar payments if required regardless of non-performance by any
other party or parties to an agreement, and (c) any liability of such Person for
the obligation of another through any agreement (contingent or otherwise) (X) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (Y) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclauses (X) or (Y) of this sentence, the primary purpose or
intent thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited.
"Contractual Obligation", as applied to any Person, means any provision
of any Security issued by that Person or of any material indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement to which Company or any of its Subsidiaries is a party.
"DLJ" means DLJ Capital Funding, Inc.
"Documentation Agent" has the meaning assigned to that term in the
introduction to this Agreement.
"Dollar Equivalent" means, at any time, (x) as to any amount
denominated in Dollars, the amount thereof at such time, and (y) as to any
amount denominated in a currency other than Dollars, the equivalent amount in
Dollars as determined by Administrative Agent at such time on the basis of the
Exchange Rate for the purchase of Dollars with such currency on the most recent
Computation Date provided for in subsection 2.1F(i) or such other time as may be
reasonably specified by Administrative Agent.
"Dollars" and the sign "$" mean the lawful money of the United States
of America.
"Domestic Subsidiary" means a direct or indirect Subsidiary of Company
that is incorporated or organized under the laws of a state of the United States
of America.
"Eligible Assignee" means (A) (i) a commercial bank organized under the
laws of the United States or any state thereof; (ii) a savings and loan
association or savings bank organized under the laws of the United States or any
state thereof; (iii) a commercial bank organized under the laws of any other
country or a political subdivision thereof; provided that (x) such bank is
acting through a branch or agency located in the United States or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country; and (iv) any other entity which is an "accredited investor" (as defined
in Regulation D under the Securities Act) which extends credit or buys loans as
one of its businesses, including insurance companies, mutual funds, lease
financing companies and investment funds and any Affiliated Funds; and (B)
Administrative Agent or any Lender, any Affiliate of Administrative Agent or any
Lender or any Affiliated Fund of Administrative Agent or any Lender; provided
that no Affiliate of Company shall be an Eligible Assignee.
"Employee Benefit Plan" means any "employee benefit plan" as defined in
Section 3(3) of ERISA which is or was maintained or contributed to by Company,
any of its Subsidiaries or any of their respective ERISA Affiliates. Any such
plan of a former ERISA Affiliate of Company or any of its Subsidiaries shall
continue to be considered an Employee Benefit Plan within the meaning of this
definition solely with respect to the period during which such former ERISA
Affiliate was an ERISA Affiliate of Company or any of its Subsidiaries with
respect to liabilities existing after such period for which Company or any of
its Subsidiaries could be liable under the Internal Revenue Code or ERISA.
"Environmental Claim" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any governmental authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials Activity, or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"Environmental Laws" means any and all current or future statutes,
ordinances, orders, rules, regulations, guidance documents, judgments,
Governmental Authorizations, or any other requirements of governmental
authorities relating to (i) environmental matters, including those relating to
any Hazardous Materials Activity, (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials, or (iii) occupational safety
and health, industrial hygiene, land use or the protection of human, plant or
animal health or welfare, in any manner applicable to Company or any of its
Subsidiaries or any Facility, including the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. ss.9601 et seq.), the
Hazardous Materials Transportation Act (49 U.S.C. ss.1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. ss.6901 et seq.), the Federal Water
Pollution Control Act (33 U.S.C. ss.1251 et seq.), the Clean Air Act (42 U.S.C.
ss.7401 et seq.), the Toxic Substances Control Act (15 U.S.C. ss.2601 et seq.),
the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. ss.136 et
seq.), the Occupational Safety and Health Act (29 U.S.C. ss.651 et seq.), the
Oil Pollution Act (33 U.S.C. ss.2701 et seq.) and the Emergency Planning and
Community Right-to-Know Act (42 U.S.C. ss.11001 et seq.), each as amended or
supplemented, any analogous present or future state or local statutes or laws,
and any regulations promulgated pursuant to any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor thereto.
"ERISA Affiliate" means, as applied to any Person, (i) any corporation
which is a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) which is a member of a
group of trades or businesses under common control within the meaning of Section
414(c) of the Internal Revenue Code of which that Person is a member; and (iii)
any member of an affiliated service group within the meaning of Section 414(m)
or (o) of the Internal Revenue Code of which that Person, any corporation
described in clause (i) above or any trade or business described in clause (ii)
above is a member. Any former ERISA Affiliate of Company or any of its
Subsidiaries shall continue to be considered an ERISA Affiliate of Company or
such Subsidiary within the meaning of this definition with respect to the period
such entity was an ERISA Affiliate of Company or such Subsidiary and with
respect to liabilities arising after such period for which Company or such
Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA Event" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect to any
Pension Plan (excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Company, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Company, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Company or any of its Subsidiaries of fines, penalties, taxes or related charges
under Chapter 43 of the Internal Revenue Code or under Section 409, Section
502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee Benefit
Plan; (ix) the occurrence of an act or omission which could give rise to the
imposition on Company, any of its Subsidiaries or any of their respective ERISA
Affiliates of fines, penalties, taxes or related charges under Section 4071 of
ERISA in respect of any Employee Benefit Plan; (x) the assertion of a material
claim (other than routine claims for benefits) against any Employee Benefit Plan
other than a Multiemployer Plan or the assets thereof, or against Company, any
of its Subsidiaries or any of their respective ERISA Affiliates in connection
with any Employee Benefit Plan; (xi) receipt from the Internal Revenue Service
of notice of the failure of any Pension Plan (or any other Employee Benefit Plan
intended to be qualified under Section 401(a) of the Internal Revenue Code) to
qualify under Section 401(a) of the Internal Revenue Code, or the failure of any
trust forming part of any Pension Plan to qualify for exemption from taxation
under Section 501(a) of the Internal Revenue Code; or (xii) the imposition of a
Lien pursuant to Section 401(a)(29) or 412(n) of the Internal Revenue Code or
pursuant to ERISA with respect to any Pension Plan.
"Event of Default" means each of the events set forth in Section 8.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor statute.
"Exchange Rate" means, on any date when an amount expressed in a
currency other than Dollars is to be determined with respect to any Letter of
Credit, the nominal rate of exchange of the applicable Issuing Lender in the New
York foreign exchange market for the purchase by such Issuing Lender (by cable
transfer) of such currency in exchange for Dollars at 12:00 noon (New York time)
one Business Day prior to such date, expressed as a number of units of such
currency per one Dollar.
"Existing Company Indebtedness" means all Indebtedness of Company and
its Subsidiaries under the Credit Agreement dated as of April 22, 1998 between
Company and NationsBank, N.A. in an outstanding principal amount of
approximately $19.2 million, indebtedness of Falcon Mimon, the Company's Czech
subsidiary, to a financial institution in an approximate principal amount of
$1.6 million and of Company under a Capital Lease dated November 16, 1998
between Kaydee Metal Products Corporation (assignor of the Company) and
Tishmingo County, Mississippi as Landlord.
"Existing Shelby Indebtedness" means all Indebtedness of Shelby and its
Subsidiaries under 7.83% Senior Notes due July 31, 1999 under Note Agreement
dated as of July 31, 1992 with the Prudential Insurance Company of America in an
outstanding amount not exceeding $3.0 million.
"Existing Letters of Credit" means the letters of credit identified as
such in Schedule 7.4 annexed hereto (but not any refinancings, renewals or
extensions thereof).
"Facilities" means any and all real property (including all buildings,
fixtures or other improvements located thereon) now, hereafter or heretofore
owned, leased, operated or used by Company, Shelby or any of their respective
Subsidiaries or any of their respective predecessors or Affiliates.
"Federal Funds Effective Rate" means, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by Administrative Agent from three Federal funds brokers
of recognized standing selected by Administrative Agent.
"Financial Condition Certificate" means a Financial Condition
Certificate, substantially in the form of Exhibit VI annexed hereto, dated as of
the Closing Date.
"Financial Plan" has the meaning assigned to that term in subsection
6.1(xii).
"First Priority" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that (i) such
Lien has priority over any other Lien on such Collateral (other than Permitted
Encumbrances which as a matter of statutory law have priority over any other
Lien irrespective of the prior perfection or filing of such other Lien) and (ii)
such Lien is the only Lien (other than Permitted Encumbrances) to which such
Collateral is subject.
"Fiscal Quarter" means a fiscal quarter of any Fiscal Year. The Fiscal
Quarters of Company are set forth on Schedule 1.1 annexed hereto.
"Fiscal Year" means the fiscal year of Company and its Subsidiaries
ending on the Saturday closest to October 31 of each calendar year.
"Flood Hazard Property" means a Mortgaged Property located in an area
designated by the Federal Emergency Management Agency as having special flood or
mud slide hazards.
"Foreign Subsidiary" means a direct or indirect Subsidiary of Company
which is incorporated or organized under the laws of any government or
sovereignty other than any state of the United States of America.
"Funding and Payment Office" means (i) the office of Administrative
Agent and Swing Line Lender located at 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000 or
(ii) such other office of Administrative Agent and Swing Line Lender as may from
time to time hereafter be designated as such in a written notice delivered by
Administrative Agent and Swing Line Lender to Company and each Lender.
"Funding Date" means the date of the funding of a Loan, which date
shall be a Business Day.
"GAAP" means, subject to the limitations on the application thereof set
forth in subsection 1.2, generally accepted accounting principles set forth in
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession, in each case as the same are applicable to the circumstances as of
the date of determination.
"Governmental Authorization" means any permit, license, authorization,
plan, directive, consent order or consent decree of or from any federal, state
or local governmental authority, agency or court.
"Guaranties" means the Subsidiary Guaranty and any Subsidiary Guaranty
executed by the Domestic Subsidiaries of Shelby.
"Hazardous Materials" means (i) any chemical, material or substance at
any time defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous waste", acutely
hazardous waste", "radioactive waste", "biohazardous waste", "pollutant", "toxic
pollutant", "contaminant", "restricted hazardous waste", "infectious waste",
"toxic substances", or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment (including harmful properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive
toxicity, "TCLP toxicity" or "EP toxicity" or words of similar import under any
applicable Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced waters and
other wastes associated with the exploration, development or production of crude
oil, natural gas or geothermal resources; (iv) any flammable substances or
explosives; (v) any radioactive materials; (vi) any asbestos-containing
materials; (vii) urea formaldehyde foam insulation; (viii) electrical equipment
which contains any oil or dielectric fluid containing polychlorinated biphenyls;
(ix) pesticides; and (x) any other chemical, material or substance, exposure to
which is prohibited, limited or regulated by any governmental authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Facility or to the indoor or outdoor
environment.
"Hazardous Materials Activity" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"Hedge Agreement" means an Interest Rate Agreement or a Currency
Agreement designed to hedge against fluctuations in interest rates or currency
values, respectively.
"Inactive Subsidiary" means any Subsidiary of Company that does not
engage in any business activity, which Subsidiary, together with all other
Inactive Subsidiaries, (a) does not own assets with an aggregate value for all
such Inactive Subsidiaries of greater than $50,000, and (b) does not, together
with all other Inactive Subsidiaries, generate aggregate revenues of greater
than $50,000 in any single Fiscal Year; and all Inactive Subsidiaries shall be
designated as such on Schedule 5.1.
"Indebtedness", as applied to any Person, means (i) all indebtedness
for borrowed money, (ii) that portion of obligations with respect to Capital
Leases that is properly classified as a liability on a balance sheet in
conformity with GAAP, (iii) notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
(iv) any obligation owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months from the date of incurrence
of the obligation in respect thereof or (b) evidenced by a note or similar
written instrument, and (v) all indebtedness secured by any Lien on any property
or asset owned or held by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person. Obligations under Interest Rate Agreements and Currency
Agreements constitute (X) in the case of Hedge Agreements, Contingent
Obligations, and (Y) in all other cases, Investments, and in neither case
constitute Indebtedness.
"Indemnitee" has the meaning assigned to that term in subsection 10.3.
"Information Systems and Equipment" means all computer hardware,
firmware and software, as well as other information processing systems, or any
equipment containing embedded microchips, whether directly or indirectly owned,
licensed, leased, operated or otherwise controlled by Company or any of its
Subsidiaries, including through third-party service providers, and which, in
whole or in part, are used, operated, relied upon or integral to Company's or
any of its Subsidiaries' conduct of their businesses.
"Intellectual Property" means all patents, trademarks, tradenames,
copyrights, technology, know-how and processes used in or necessary for the
conduct of the business of Company and its Subsidiaries as currently conducted
that are material to the condition (financial or otherwise), business or
operations of Company and its Subsidiaries, taken as a whole.
"Interest Payment Date" means (i) with respect to any Base Rate Loan,
the last Business Day of each March, June, September and December, of each year,
commencing on the first such date to occur after the Closing Date, and (ii) with
respect to any LIBO Rate Loan, the last Business Day of each Interest Period
applicable to such Loan; provided that in the case of each Interest Period of
longer than three months "Interest Payment Date" shall also include the Business
Day that is three months, or an multiple thereof, after the commencement of such
Interest Period.
"Interest Period" has the meaning assigned to that term in subsection
2.2B.
"Interest Rate Agreement" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement to which Company or any of its Subsidiaries is a party.
"Interest Rate Determination Date" means, with respect to any Interest
Period, the second Business Day prior to the first day of such Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"Investment" means (i) any direct or indirect purchase or other
acquisition by Company or any of its Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary of
Company), (ii) any direct or indirect redemption, retirement, purchase or other
acquisition for value, by any Subsidiary of Company from any Person other than
Company or any of its wholly-owned Domestic Subsidiaries, of any equity
Securities of such Subsidiary, (iii) any direct or indirect loan, advance (other
than advances to employees for moving, entertainment and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business) or
capital contribution by Company or any of its Subsidiaries to any other Person
(other than a wholly-owned Domestic Subsidiary of Company), including all
indebtedness and accounts receivable from that other Person that are not current
assets or did not arise from sales to that other Person in the ordinary course
of business, or (iv) Interest Rate Agreements or Currency Agreements not
constituting Hedge Agreements. The amount of any Investment shall be the
original cost of such Investment plus the cost of all additions thereto, without
any adjustments for increases or decreases in value, or write-ups, write-downs
or write-offs with respect to such Investment.
"IP Collateral" means, collectively, any Collateral under any Security
Agreement and any Subsidiary Security Agreement consisting of trademarks,
servicemarks, tradenames, tradesecrets, business names, logos, patents, patent
applications, licenses, copyrights, any registration and franchise rights and
interests relating thereto, and any other intellectual property of any type, and
all goodwill associated with any of the foregoing.
"Issuing Lender" means, with respect to any Letter of Credit, the
Revolving Lender that agrees or is otherwise obligated to issue such Letter of
Credit, determined as provided in subsection 3.1B(ii), or which has issued any
Existing Letters of Credit.
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
that in no event shall any corporate Subsidiary of any Person be considered to
be a Joint Venture to which such Person is a party.
"Landlord Consent and Estoppel" means, with respect to any Leasehold
Property, a letter, certificate or other instrument in writing from the lessor
(and all other parties having a consent right) under the related lease,
satisfactory in form and substance to Administrative Agent, pursuant to which
such lessor (and all other parties having a consent right) agrees, for the
benefit of Administrative Agent, (i) that without any further consent of such
lessor (and all other parties having a consent right) or any further action on
the part of the Loan Party holding such Leasehold Property, such Leasehold
Property may be encumbered pursuant to a Mortgage and may be assigned to the
purchaser at a foreclosure sale or in a transfer in lieu of such a sale (and to
a subsequent third party assignee if any Agent, any Lender, or an Affiliate of
either so acquires such Leasehold Property), (ii) that such lessor shall not
terminate such lease as a result of a default by such Loan Party thereunder
without first giving Administrative Agent notice of such default and at least 15
days in the case of a monetary default and 30 days in the case of a non-monetary
default beyond the cure period afforded to the tenant thereunder to cure such
default, and (iii) to such other matters relating to such Leasehold Property as
Administrative Agent may reasonably request.
"Leasehold Property" means any leasehold interest of any Loan Party as
lessee under any lease of real property.
"Lender" and "Lenders" means the persons identified as "Lenders" and
listed on the signature pages of this Agreement, together with their successors
and permitted assigns pursuant to subsection 10.1, and the term "Lenders" shall
include Swing Line Lender unless the context otherwise requires.
"Letter of Credit" or "Letters of Credit" means Commercial Letters of
Credit and Standby Letters of Credit issued or to be issued by Issuing Lenders
for the account of Company pursuant to subsection 3.1 and the Existing Letters
of Credit.
"Letter of Credit Usage" means, as at any date of determination, the
sum of (i) the maximum aggregate amount which is or at any time thereafter may
become available for drawing under all Letters of Credit then outstanding plus
(ii) the aggregate amount of all drawings under Letters of Credit honored by
Issuing Lenders and not theretofore reimbursed by Company. For the purposes of
this definition, any amount described in clause (i) or (ii) of the preceding
sentence which is denominated in a currency other than Dollars shall be valued
based on the applicable Exchange Rate for such Currency as of the applicable
date of determination.
"LIBO Rate Loans" means Loans bearing interest at rates determined by
reference to the Adjusted LIBO Rate as provided in subsection 2.2A.
"Lien" means any lien, mortgage, pledge, assignment, security interest,
charge or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"Loan" or "Loans" means one or more of the Tranche A Term Loans,
Revolving Loans or Swing Line Loans or any combination thereof.
"Loan Documents" means this Agreement, the Notes, the Letters of Credit
(and any applications for, or reimbursement agreements or other documents or
certificates executed by Company in favor of an Issuing Lender relating to, the
Letters of Credit), the Guaranties and the Collateral Documents.
"Loan Party" means each of Acquisition Co., Company and any of
Company's Subsidiaries from time to time executing a Loan Document, and "Loan
Parties" means all such Persons, collectively.
"Margin Determination Certificate" means a Margin Determination
Certificate of Company delivered pursuant to 6.1(xvii) setting forth in
reasonable detail the calculation of the Consolidated Leverage Ratio for the
four-Fiscal Quarter period ending as of the last day of the Fiscal Quarter
immediately preceding the Fiscal Quarter in which such certificate is delivered.
"Margin Stock" has the meaning assigned to that term in Regulation U of
the Board of Governors of the Federal Reserve System as in effect from time to
time.
"Material Adverse Effect" means (i) any event or change in or effect on
the business of Company and its Subsidiaries, taken as a whole, that is or can
reasonably be expected to be materially adverse to the business, operations,
properties (including intangible properties), condition (financial or
otherwise), assets, liabilities or prospects of Company and its Subsidiaries,
taken as a whole, or (ii) the impairment in any material respect of the ability
of any Loan Party to perform, or of Administrative Agent or Lenders to enforce,
the Obligations.
"Material Leasehold Property" means a Leasehold Property reasonably
determined by Administrative Agent to be of material value as Collateral or of
material importance to the operations of Company or any of its Subsidiaries.
"Merger" means the merger of Acquisition Co. with and into Shelby
pursuant to the Merger Agreement, with Shelby as the surviving corporation.
"Merger Agreement" means the Agreement and Plan of Merger dated as of
May 5, 1999 by and among Company, Acquisition Co. and Shelby, as such agreement
may be amended from time to time to the extent permitted under subsection 7.14.
"Merger Date" means the date upon which the Merger is consummated.
"Merger Document" means either (x) the Merger Agreement dated as of the
Merger Date by and among Acquisition Co. and Shelby, or (y) the Certificate of
Merger filed with the Secretary of State for the State of Delaware on the Merger
Date, in each case as such agreement or certificate may be amended from time to
time to the extent permitted under subsection 7.14.
"Minimum Shares" means that number of shares of Shelby Common Stock
which represents at least a majority of the total number of outstanding shares
of Shelby Common Stock on a fully diluted basis on the date of purchase but not
less than a sufficient number of shares to permit Acquisition Co. acting alone
to cause the Merger to be approved by the stockholders of Shelby.
"Mortgage" means (i) a security instrument (whether designated as a
deed of trust or a mortgage or by any similar title) executed and delivered by
any Loan Party, substantially in such form as may be approved by Administrative
Agent in its reasonable discretion, in each case with such changes thereto as
may be recommended by Administrative Agent's local counsel based on local laws
or customary local mortgage or deed of trust practices, or (ii) at the option of
Administrative Agent, in the case of an Additional Mortgaged Property (as
defined in subsection 6.9), an amendment to an existing Mortgage, in form
reasonably satisfactory to Administrative Agent, adding such Additional
Mortgaged Property to the Real Property Assets encumbered by such existing
Mortgage, in either case as such security instrument or amendment may be
amended, supplemented or otherwise modified from time to time.
"Mortgages" means all such instruments, including the Closing Date
Mortgages (as defined in subsection 4.1G), the Merger Date Mortgages (as defined
in subsection 4.2E) and any Additional Mortgages (as defined in subsection 6.9),
collectively.
"Mortgaged Property" means a Closing Date Mortgaged Property (as
defined in subsection 4.1G), a Merger Date Mortgaged Property (as defined in
subsection 4.2E) or an Additional Mortgaged Property (as defined in subsection
6.9).
"Multiemployer Plan" means any Employee Benefit Plan which is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"Net Asset Sale Proceeds" means, with respect to any Asset Sale, Cash
payments (including any Cash received by way of deferred payment pursuant to, or
by monetization of, a note receivable or otherwise, but only as and when so
received) received from such Asset Sale, net of any bona fide direct costs
incurred in connection with such Asset Sale, including (i) income taxes
reasonably estimated to be actually payable within two years of the date of such
Asset Sale as a result of any gain recognized in connection with such Asset Sale
and (ii) payment of the outstanding principal amount of, premium or penalty, if
any, and interest on any Indebtedness (other than the Loans) that is secured by
a Lien on the stock or assets in question and that is required to be repaid
under the terms thereof as a result of such Asset Sale.
"Net Insurance/Condemnation Proceeds" means any Cash payments or
proceeds received by Company or any of its Subsidiaries (i) under any business
interruption or casualty insurance policy in respect of a covered loss
thereunder or (ii) as a result of the taking of any assets of Company or any of
its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, in each case net of any
actual and reasonable documented costs incurred by Company or any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
Company or such Subsidiary in respect thereof.
"Notes" means one or more of the Tranche A Term Notes, Revolving Notes
or Swing Line Note or any combination thereof.
"Notice of Borrowing" means a notice substantially in the form of
Exhibit I annexed hereto delivered by Company to Administrative Agent pursuant
to subsection 2.1B with respect to a proposed borrowing.
"Notice of Conversion/Continuation" means a notice substantially in the
form of Exhibit II annexed hereto delivered by Company to Administrative Agent
pursuant to subsection 2.2D with respect to a proposed conversion or
continuation of the applicable basis for determining the interest rate with
respect to the Loans specified therein.
"Obligations" means all obligations of every nature of each Loan Party
from time to time owed to Agents, Lenders or any of them under the Loan
Documents and Hedge Agreements to which any of the Lenders is a party, whether
for principal, interest, reimbursement of amounts drawn under Letters of Credit,
fees, expenses, indemnification or otherwise.
"Officers' Certificate" means, as applied to any corporation, a
certificate executed on behalf of such corporation by its president or one of
its vice-presidents and by its chief financial officer (or if there is no chief
financial officer, its chief accounting officer) or its treasurer; provided that
every Officers' Certificate with respect to the compliance with a condition
precedent to the making of any Loans hereunder shall include (i) a statement
that the officer or officers making or giving such Officers' Certificate has or
have read such condition and any definitions or other provisions contained in
this Agreement relating thereto, (ii) a statement that, in the opinion of the
signer or signers, such signer or signers has or have made or has or have caused
to be made such examination or investigation as is necessary to enable such
signer or signers to express an informed opinion as to whether or not such
condition has been complied with, and (iii) a statement as to whether, in the
opinion of the signer or signers, such condition has been complied with.
"Operating Lease" means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) that is not a Capital Lease in accordance with
GAAP other than any such lease under which that Person is the lessor.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"Permitted Acquisition" means any acquisition, whether by purchase,
merger, reorganization or any other method, by Company or any of its
Subsidiaries of (x) another Person which is engaged primarily in the same line
of business as Company and its Subsidiaries or (y) the assets or other property
of another Person relating primarily to the same line of business as Company and
its Subsidiaries; provided that any such Permitted Acquisition shall comply with
the provisions of subsection 7.7(vii).
"Permitted Currency" means, with respect to a Letter of Credit to be
issued in a currency other than Dollars, Italian Liras, Spanish Pesetas or any
other currency approved by the Administrative Agent and the Issuing Lender of
such Letter of Credit in their sole discretion.
"Permitted Encumbrances" means the following types of Liens (excluding
any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the Internal
Revenue Code or by ERISA, any such Lien relating to or imposed in connection
with any Environmental Claim, and any such Lien expressly prohibited by any
applicable terms of any of the Loan Documents):
(i) Liens for taxes, assessments or governmental charges or
claims the payment of which is not, at the time, required by subsection
6.3;
(ii) statutory Liens of landlords, statutory Liens of banks
and rights of set-off, statutory Liens of carriers, warehousemen,
mechanics, repairmen, workmen and materialmen, and other Liens imposed
by law, in each case incurred in the ordinary course of business (a)
for amounts not yet overdue or (b) for amounts that are overdue and
that (in the case of any such amounts overdue for a period in excess of
15 days) are being contested in good faith by appropriate proceedings,
so long as (1) such reserves or other appropriate provisions, if any,
as shall be required by GAAP shall have been made for any such
contested amounts, and (2) in the case of a Lien with respect to any
portion of the Collateral, such contest proceedings conclusively
operate to stay the sale of any portion of the Collateral on account of
such Lien;
(iii) Liens incurred or deposits made in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money), so long as no
foreclosure, sale or similar proceedings have been commenced with
respect to any portion of the Collateral on account thereof;
(iv) any attachment or judgment Lien not constituting an Event
of Default under subsection 8.8;
(v) leases or subleases granted to third parties in accordance
with any applicable terms of the Collateral Documents and not
interfering in any material respect with the ordinary conduct of the
business of Company or any of its Subsidiaries or resulting in a
material diminution in the value of any Collateral as security for the
Obligations;
(vi) easements, rights-of-way, covenants, conditions,
restrictions, encroachments, and other defects or irregularities in
title, in each case which do not and will not interfere in any material
respect with the ordinary conduct of the business of Company or any of
its Subsidiaries or result in a material diminution in the value of any
Collateral as security for the Obligations;
(vii) any (a) interest or title of a lessor or sublessor under
any lease permitted under this Agreement, (b) restriction or
encumbrance that the interest or title of such lessor or sublessor may
be subject to, or (c) subordination of the interest of the lessee or
sublessee under such lease to any restriction or encumbrance referred
to in the preceding clause (b), so long as the holder of such
restriction or encumbrance agrees to recognize the rights of such
lessee or sublessee under such lease;
(viii) Liens arising from filing UCC financing statements
relating solely to leases not prohibited by this Agreement;
(ix) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection
with the importation of goods;
(x) any zoning or similar law or right reserved to or vested
in any governmental office or agency to control or regulate the use of
any real property;
(xi) Liens securing obligations (other than obligations
representing Indebtedness for borrowed money) under operating,
reciprocal easement or similar agreements entered into in the ordinary
course of business of Company and its Subsidiaries; and
(xii) licenses of patents, trademarks and other intellectual
property rights granted by Company or any of its Subsidiaries in the
ordinary course of business and not interfering in any material respect
with the ordinary conduct of the business of Company or such
Subsidiary.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"Pledge Agreement" means the Pledge Agreement executed and delivered by
Company on the Closing Date with respect to all the capital stock of Company's
Domestic Subsidiaries and any pledged debt substantially in the form of Exhibit
XIII annexed hereto or with respect to pledges of the capital stock of Company's
Foreign Subsidiaries, such other forms as may be satisfactory to Administrative
Agent, as such Pledge Agreements may thereafter be amended, supplemented or
otherwise modified from time to time.
"Pledged Collateral" means, collectively, the "Pledged Collateral" as
defined in the Pledge Agreements and the Subsidiary Pledge Agreements.
"Potential Event of Default" means a condition or event that, after
notice or lapse of time or both, would constitute an Event of Default.
"Prime Rate" means the prime lending rate as set forth on the British
Banking Association Telerate page 5 (or such other comparable page as may, in
the opinion of the Administrative Agent, replace such page for the purpose of
displaying such rate), as in effect from time to time. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually available. Administrative Agent or any Lender may make commercial loans
or other loans at rates of interest at, above or below the Prime Rate.
"Pro Forma Basis" means, as of any date of determination, the
compliance of Company with the financial covenants set forth in subsection 7.6A
and 7.6B as of the last day of the four Fiscal Quarter period most recently
ended prior to such date of determination for which the relevant financial
information is available (the "Compliance Period"), after giving effect on a pro
forma basis to any Permitted Acquisitions made during such Compliance Period and
any dispositions made during such Compliance Period, other than sales of
inventory in the ordinary course of business and dispositions of obsolete
equipment on the following basis:
(i) any Indebtedness incurred or assumed by Company or any of
its Subsidiaries in connection with such Permitted Acquisitions and any
Indebtedness repaid in connection with such Permitted Acquisitions or
dispositions shall be deemed to have been incurred or repaid,
respectively, as of the first day of the Compliance Period;
(ii) if such Indebtedness incurred or assumed by Company or
any of its Subsidiaries in connection with such Permitted Acquisitions
has a floating or formula rate, then the rate of interest for such
Indebtedness for the applicable period shall be computed as if the rate
in effect for such Indebtedness on the relevant measurement date had
been the applicable rate for the entire applicable period;
(iii) income statement items (whether positive or negative)
attributable to the property or business acquired or disposed of in
such Permitted Acquisitions or dispositions shall be included as if
such acquisitions or dispositions took place on the first day of such
Compliance Period on a pro forma basis; and
(iv) any historical extraordinary non-recurring costs or
expenses or other verifiable costs or expenses that will not continue
after the acquisition or disposition date may be eliminated and other
expenses and cost reductions may be reflected on a basis consistent
with Regulation S-X promulgated by the Securities and Exchange
Commission.
With respect to any such Permitted Acquisitions, such pro
forma calculations shall be based on the audited or reviewed financial
results delivered in compliance with clause (f)(3) of subsection
7.7(vii). All pro forma adjustments shall be approved by the
Administrative Agent.
"Pro Rata Share" means (i) with respect to all payments, computations
and other matters relating to the Tranche A Term Loan Commitment or the Tranche
A Term Loan of any Lender, the percentage obtained by dividing (x) the Tranche A
Term Loan Exposure of that Lender by (y) the aggregate Tranche A Term Loan
Exposure of all Lenders, (ii) with respect to all payments, computations and
other matters relating to the Revolving Loan Commitment or the Revolving Loans
of any Lender or any Letters of Credit issued or participations therein
purchased by any Lender or any participations in any Swing Line Loans purchased
or deemed purchased by any Revolving Lender, the percentage obtained by dividing
(x) the Revolving Loan Exposure of that Lender by (y) the aggregate Revolving
Loan Exposure of all Lenders, and (iii) for all other purposes with respect to
each Lender, the percentage obtained by dividing (x) the sum of the Tranche A
Term Loan Exposure of that Lender plus the Revolving Loan Exposure of that
Lender by (y) the sum of the aggregate Tranche A Term Loan Exposure of all
Lenders plus the aggregate Revolving Loan Exposure of all Lenders, in any such
case as the applicable percentage may be adjusted by assignments permitted
pursuant to subsection 10.1. The initial Pro Rata Share of each Lender for
purposes of each of clauses (i), (ii) and (iii) of the preceding sentence is set
forth opposite the name of that Lender in Schedule 2.1 annexed hereto.
"PTO" means the United States Patent and Trademark Office or any
successor or substitute office in which filings are necessary or, in the opinion
of Administrative Agent, desirable in order to create or perfect Liens on any IP
Collateral.
"Purchase Money Indebtedness" means Indebtedness of Company or any of
its Subsidiaries incurred in connection with the purchase of assets or other
property for the business of Company or any of its Subsidiaries; provided that
the recourse of the lenders with respect to such Indebtedness is limited solely
to the assets or other property so purchased without further recourse to either
Company or any of its Subsidiaries.
"Real Property Asset" means, at any time of determination, any interest
then owned by any Loan Party in any real property.
"Recorded Leasehold Interest" means a Leasehold Property with respect
to which a Record Document (as hereinafter defined) has been recorded in all
places necessary or desirable, in the reasonable judgment of Administrative
Agent, to give constructive notice of such Leasehold Property to third-party
purchasers and encumbrances of the affected real property. For purposes of this
definition, the term "Record Document" means, with respect to any Leasehold
Property, (a) the lease evidencing such Leasehold Property or a memorandum
thereof, executed and acknowledged by the owner of the affected real property,
as lessor, or (b) if such Leasehold Property was acquired or subleased from the
holder of a Recorded Leasehold Interest, the applicable assignment or sublease
document, executed and acknowledged by such holder, in each case in form
sufficient to give such constructive notice upon recordation and otherwise in
form reasonably satisfactory to Administrative Agent.
"Refunded Swing Line Loans" has the meaning assigned to that term in
subsection 2.1A(iii).
"Register" has the meaning assigned to that term in subsection 2.1D.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Agreements" means, collectively, the Tender Offer Materials,
the Merger Agreement, the Senior Subordinated Debt Indenture and the Senior
Subordinated Debt Securities.
"Release" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"Replaced Lender" has the meaning assigned to that term in subsection
2.8.
"Replacement Lender" has the meaning assigned to that term in
subsection 2.8.
"Request for Issuance of Letter of Credit" means a notice substantially
in the form of Exhibit III annexed hereto delivered by Company to Administrative
Agent pursuant to subsection 3.1B(i) with respect to the proposed issuance of a
Letter of Credit.
"Requisite Lenders" means Lenders having or holding more than 50% of
the sum of (i) the aggregate Tranche A Term Loan Exposure of all Lenders plus
(ii) the aggregate Revolving Loan Exposure of all Lenders.
"Restricted Junior Payment" means (i) any distribution, direct or
indirect, on account of any class of stock of Company now or hereafter
outstanding, except a distribution payable solely in shares of that class of
stock payable solely to holders of that class, (ii) any redemption, retirement,
sinking fund or similar payment, purchase or other acquisition for value, direct
or indirect, of any class of stock of Company now or hereafter outstanding,
(iii) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of stock of
Company now or hereafter outstanding, and (iv) any payment or prepayment of
principal of, premium, if any, or interest on, or redemption, purchase,
retirement, defeasance (including in-substance or legal defeasance), sinking
fund or similar payment with respect to, any Subordinated Indebtedness.
"Revolving Lender" means a Lender having a Revolving Loan Commitment.
"Revolving Loan Commitment" means the commitment of a Revolving Lender
to make Revolving Loans to Company pursuant to subsection 2.1A(ii), and
"Revolving Loan Commitments" means such commitments of all Revolving Lenders in
the aggregate.
"Revolving Loan Commitment Termination Date" means the last day of the
Fiscal Quarter ending on or about April 30, 2005.
"Revolving Loan Exposure" means, with respect to any Revolving Lender
as of any date of determination (i) prior to the termination of the Revolving
Loan Commitments, that Revolving Lender's Revolving Loan Commitment and (ii)
after the termination of the Revolving Loan Commitments, the sum of (a) the
aggregate outstanding principal amount of the Revolving Loans of that Revolving
Lender plus (b) in the event that Revolving Lender is an Issuing Lender, the
aggregate Letter of Credit Usage in respect of all Letters of Credit issued by
that Revolving Lender (in each case net of any participations purchased or
deemed purchased by other Revolving Lenders in such Letters of Credit or any
unreimbursed drawings thereunder) plus (c) the aggregate amount of all
participations purchased or deemed purchased by that Revolving Lender in any
outstanding Letters of Credit or any unreimbursed drawings under any Letters of
Credit plus (d) in the case of Swing Line Lender, the aggregate outstanding
principal amount of all Swing Line Loans (net of any participations therein
purchased or deemed purchased by other Revolving Lenders) plus (e) the aggregate
amount of all participations purchased or deemed purchased by that Revolving
Lender in any outstanding Swing Line Loans.
"Revolving Loans" means the Loans made by Revolving Lenders to Company
pursuant to subsection 2.1A(ii).
"Revolving Notes" means (i) the promissory notes of Company issued
pursuant to subsection 2.1E(ii) on the Closing Date and (ii) any promissory
notes issued by Company pursuant to the last sentence of subsection 10.1B(i) in
connection with assignments of the Revolving Loan Commitments and Revolving
Loans of any Revolving Lenders, in each case substantially in the form of
Exhibit IV-B annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.
"Security Agreement" means the Security Agreement executed and
delivered by Company on the Closing Date substantially in the form of Exhibit
XIV annexed hereto, as such Security Agreement may thereafter be amended,
supplemented or otherwise modified from time to time.
"Securities" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, and any successor statute.
"Senior Subordinated Debt Securities" means the senior subordinated
unsecured notes, issued by Company pursuant to the Senior Subordinated Debt
Indenture, having the terms and conditions substantially as described in the
"Description of Notes" section of that certain Preliminary Offering Memorandum
of Company dated May 26, 1999, which Senior Subordinated Debt Securities shall
be in form and substance satisfactory to Administrative Agent and Requisite
Lenders, as such Senior Subordinated Debt Securities may be amended from time to
time to the extent permitted under subsection 7.14, all the proceeds of which
are to be used pursuant to subsection 4.1F.
"Senior Subordinated Debt Indenture" means the indenture executed by
Company and a trustee named therein pursuant to which the Senior Subordinated
Debt Securities are issued, which indenture shall be in form and substance
satisfactory to Administrative Agent, as such indenture may be amended from time
to time to the extent permitted under subsection 7.14.
"Shelby" means Xxxxxx Xxxxxxxx Industries, Inc., a Delaware
corporation.
"Shelby Common Stock" means the common stock, $0.05 par value, of
Shelby.
"Solvent" means, with respect to any Person, that as of the date of
determination both (A) (i) the then fair saleable value of the property of such
Person is (y) greater than the total amount of liabilities (including contingent
liabilities) of such Person and (z) not less than the amount that will be
required to pay the probable liabilities on such Person's then existing debts as
they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (ii) such Person's
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"Standby Letter of Credit" means any standby letter of credit or
similar instrument issued for the purpose of supporting (i) Indebtedness of
Company or any of its Subsidiaries in respect of industrial revenue or
development bonds or financings, (ii) workers' compensation liabilities of
Company or any of its Subsidiaries, (iii) the obligations of third party
insurers of Company or any of its Subsidiaries, (iv) obligations with respect to
Capital Leases or Operating Leases of Company or any of its Subsidiaries, and
(v) performance, payment, deposit or surety obligations of Company or any of its
Subsidiaries, in any case if required by law or governmental rule or regulation
or in accordance with custom and practice in the industry; provided that Standby
Letters of Credit may not be issued for the purpose of supporting (a) trade
payables or (b) any Indebtedness constituting "antecedent debt" (as that term is
used in Section 547 of the Bankruptcy Code).
"Subordinated Indebtedness" means Indebtedness of Company subordinated
in right of payment to the Obligations pursuant to documentation containing
maturities, amortization schedules, covenants, defaults, remedies, subordination
provisions and other material terms in form and substance satisfactory to
Administrative Agent and Requisite Lenders.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.
"Subsidiary Guarantor" means (i) any Domestic Subsidiary of Company
with respect to the Subsidiary Guaranty executed and delivered by such
Subsidiaries in favor of Administrative Agent, on behalf of Lenders, on the
Closing Date and to be executed and delivered by additional Subsidiaries of
Company from time to time thereafter in accordance with subsection 6.8, and (ii)
any Domestic Subsidiary of Company that executes and delivers a counterpart of
the Subsidiary Guaranty in favor of Administrative Agent, on behalf of Lenders,
on the Merger Date.
"Subsidiary Guaranty" means (i) the Subsidiary Guaranty in favor of
Administrative Agent, on behalf of Lenders, executed and delivered by the
Domestic Subsidiaries of Company (other than any Inactive Subsidiary) on the
Closing Date and to be executed and delivered by additional Subsidiaries of
Company (other than any Inactive Subsidiary) from time to time thereafter in
accordance with subsection 6.8, and (ii) the Subsidiary Guaranty in favor of
Administrative Agent, on behalf of Lenders, executed and delivered by Domestic
Subsidiaries of Company on the Merger Date, in each case substantially in the
form of Exhibit XV annexed hereto, as each such Subsidiary Guaranty may
hereafter be amended, supplemented or otherwise modified from time to time.
"Subsidiary Pledge Agreement" means (i) each Subsidiary Pledge
Agreement executed and delivered by an existing Subsidiary Guarantor of Company
on the Closing Date or executed and delivered by any additional Subsidiary
Guarantor of Company from time to time thereafter in accordance with subsection
6.8 and (ii) each Subsidiary Pledge Agreement executed and delivered by an
existing Subsidiary Guarantor of Company on the Merger Date, in each case
substantially in the form of Exhibit XVI annexed hereto or with respect to
pledges of the capital stock of Foreign Subsidiaries (other than any Inactive
Subsidiary), such other forms as may be satisfactory to Administrative Agent, as
each such Subsidiary Pledge Agreement may be amended, supplemented or otherwise
modified from time to time, and "Subsidiary Pledge Agreements" means all such
Subsidiary Pledge Agreements, collectively.
"Subsidiary Security Agreement" means (i) each Subsidiary Security
Agreement executed and delivered by an existing Subsidiary Guarantor of Company
on the Closing Date or executed and delivered by any additional Subsidiary
Guarantor of Company from time to time thereafter in accordance with subsection
6.8 and (ii) each Subsidiary Security Agreement executed and delivered by a
Subsidiary Guarantor of Company on the Merger Date, in each case substantially
in the form of Exhibit XVII annexed hereto, as each such Subsidiary Security
Agreement may be amended, supplemented or otherwise modified from time to time,
and "Subsidiary Security Agreements" means all such Subsidiary Security
Agreements, collectively.
"Supplemental Collateral Agent" has the meaning assigned to that term
in subsection 9.1B.
"Swing Line Lender" means DLJ, or any Person serving as a successor
Administrative Agent hereunder, in its capacity as Swing Line Lender hereunder.
"Swing Line Loan Commitment" means the commitment of Swing Line Lender
to make Swing Line Loans to Company pursuant to subsection 2.1A(iii).
"Swing Line Loans" means the Loans made by Swing Line Lender to Company
pursuant to subsection 2.1A(iii).
"Swing Line Note" means (i) the promissory note of Company issued
pursuant to subsection 2.1E(iii) on the Closing Date and (ii) any promissory
note issued by Company to any successor Administrative Agent and Swing Line
Lender pursuant to the last sentence of subsection 9.5B, in each case
substantially in the form of Exhibit IV-C annexed hereto, as it may be amended,
supplemented or otherwise modified from time to time.
"Syndication Agent" has the meaning assigned to that term in the
introduction to this Agreement.
"Tax" or "Taxes" means any present or future tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature and whatever called, by
whomsoever, on whomsoever and wherever imposed, levied, collected, withheld or
assessed; provided that "Tax on the overall net income" of a Person shall be
construed as a reference to a tax imposed by the jurisdiction in which that
Person is organized or in which that Person's principal office (and/or, in the
case of a Lender, its lending office) is located or in which that Person
(and/or, in the case of a Lender, its lending office) is deemed to be doing
business on all or part of the net income, profits or gains (whether worldwide,
or only insofar as such income, profits or gains are considered to arise in or
to relate to a particular jurisdiction, or otherwise) of that Person (and/or, in
the case of a Lender, its lending office).
"Tender Offer" means the offer by Acquisition Co. to purchase all of
the outstanding shares of Shelby Common Stock for the Tender Offer Price, in
cash, pursuant to the Tender Offer Materials.
"Tender Offer Materials" means the Tender Offer Statement on Schedule
14D-1 filed by Acquisition Co. on May 12, 1999 with the Securities and Exchange
Commission pursuant to Section 14(d)(1) of the Exchange Act, together with all
exhibits, supplements and amendments thereto and any other amendments prior to
the date hereof.
"Tender Offer Price" means $16.50 per share of Shelby Common Stock or
such other purchase price per share as may be approved by Administrative Agent
pursuant to subsections 4.1F(i) and (ii).
"Term Loans" means the Tranche A Term Loans.
"Title Company" means one or more title insurance companies reasonably
satisfactory to Administrative Agent.
"Total Utilization of Revolving Loan Commitments" means, as at any date
of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans plus (ii) the aggregate principal amount of all
outstanding Swing Line Loans plus (iii) the Letter of Credit Usage.
"Tranche A Term Loan Commitment" means the commitment of a Lender to
make a Tranche A Term Loan to Company pursuant to subsection 2.1A(i), and
"Tranche A Term Loan Commitments" means such commitments of all Lenders in the
aggregate.
"Tranche A Term Loan Exposure" means, with respect to any Tranche A
Term Loan Lender as of any date of determination (i) prior to the funding of all
of the Tranche A Term Loans, that Lender's original Tranche A Term Loan
Commitment and (ii) after the funding of all of the Tranche A Term Loans, the
outstanding principal amount of the Tranche A Term Loan of that Lender.
"Tranche A Term Loan Lender" means any Lender who holds a Tranche A
Term Loan Commitment, or who has made a Tranche A Term Loan hereunder and any
assignee of such Lender pursuant to subsection 10.1B.
"Tranche A Term Loans" means the Tranche A Term Loans made by Tranche A
Term Loan Lenders to Company pursuant to subsection 2.1A(i).
"Tranche A Term Notes" means (i) the promissory notes of Company issued
pursuant to subsection 2.1E(i) on the Closing Date and (ii) any promissory notes
issued by Company pursuant to the last sentence of subsection 10.1B(i) in
connection with assignments of the Tranche A Term Loan Commitments or Tranche A
Term Loans of any Tranche A Term Loan Lenders, in each case substantially in the
form of Exhibit IV-A annexed hereto, as they may be amended, supplemented or
otherwise modified from time to time.
"Transaction Costs" means the fees, costs and expenses payable by any
Loan Party or by Shelby in connection with the Tender Offer, the Merger, the
related financing and other transactions contemplated by the Loan Documents and
the Related Agreements in an aggregate amount not to exceed $10.5 million.
"UCC" means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.
"Year 2000 Compliant" means that all Information Systems and Equipment
accurately process date data (including without limitation calculating,
comparing and sequencing) in all material respects before, during and after the
year 2000, as well as same and multi-century dates, or between the years 1999
and 2000, taking into account all leap years, including the fact that the year
2000 is a leap year, and further, that when used in combination with, or
interfacing with, other Information Systems and Equipment, shall accurately
accept, release and exchange date data, and shall in all material respects
continue to function in the same manner as it performs today and shall not
otherwise materially impair the accuracy or functionality of Information Systems
and Equipment.
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (i), (ii),
and (xii) of subsection 6.1 shall be prepared in accordance with GAAP as in
effect at the time of such preparation (and delivered together with the
reconciliation statements provided for in subsection 6.1(iv)). Calculations in
connection with the definitions, covenants and other provisions of this
Agreement shall utilize accounting principles and policies in conformity with
those used to prepare the financial statements referred to in subsection 5.3.
1.3 Other Definitional Provisions and Rules of Construction
A. Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.
B. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided. C. The use in any of the Loan Documents of the word "include" or
"including", when following any general statement, term or matter, shall not be
construed to limit such statement, term or matter to the specific items or
matters set forth immediately following such word or to similar items or
matters, whether or not nonlimiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Making of Loans; Notes
A. Commitments. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Company herein set
forth, each Tranche A Term Loan Lender hereby severally agrees to make the
Tranche A Term Loans described in subsection 2.1A(i), each Revolving Lender
hereby severally agrees to make the Revolving Loans described in subsection
2.1A(ii), and Swing Line Lender hereby agrees to make the Swing Line Loans
described in subsection 2.1A(iii).
(i) Tranche A Term Loans. Each Tranche A Term Loan Lender
severally agrees to lend to Company on the Closing Date and on the
Merger Date an aggregate amount not exceeding its Pro Rata Share of the
aggregate amount of the Tranche A Term Loan Commitments to be used for
the purposes identified in subsection 2.5A. The amount of each Tranche
A Term Loan Lender's Tranche A Term Loan Commitment is set forth
opposite its name on Schedule 2.1 annexed hereto and the aggregate
amount of the Tranche A Term Loan Commitments is $70 million; provided
further that the Tranche A Term Loan Commitments of the Tranche A Term
Loan Lenders shall be adjusted to give effect to any assignments of the
Tranche A Term Loan Commitments pursuant to subsection 10.1B. Each
Tranche A Term Loan Lender's Term Loan Commitment (i) shall be reduced
by an amount equal to the principal amount of the Tranche A Term Loan,
if any, made by such Tranche A Term Lender on the Closing Date,
immediately after giving effect thereto, and (ii) to the extent unused,
shall expire on the close of business on the Merger Date. Amounts
borrowed under this subsection 2.1A(i) and subsequently repaid or
prepaid may not be reborrowed.
(ii) Revolving Loans. Each Revolving Lender severally agrees,
subject to the limitations set forth below with respect to the maximum
amount of Revolving Loans permitted to be outstanding from time to
time, to lend to Company from time to time during the period from the
Closing Date to but excluding the Revolving Loan Commitment Termination
Date an aggregate amount not exceeding its Pro Rata Share of the
aggregate amount of the Revolving Loan Commitments to be used for the
purposes identified in subsection 2.5B. The original amount of each
Revolving Lender's Revolving Loan Commitment is set forth opposite its
name on Schedule 2.1 annexed hereto and the aggregate original amount
of the Revolving Loan Commitments is $50 million; provided that the
Revolving Loan Commitments of the Revolving Lenders shall be adjusted
to give effect to any assignments of the Revolving Loan Commitments
pursuant to subsection 10.1B; and provided further that the amount of
the Revolving Loan Commitments shall be reduced from time to time by
the amount of any reductions thereto made pursuant to subsections
2.4B(ii) and 2.4B(iii). Each Revolving Lender's Revolving Loan
Commitment shall expire on the Revolving Loan Commitment Termination
Date and all Revolving Loans and all other amounts owed hereunder with
respect to the Revolving Loans and the Revolving Loan Commitments shall
be paid in full no later than that date. Amounts borrowed under this
subsection 2.1A(ii) may be repaid and reborrowed to but excluding the
Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, in no event shall the Total Utilization of Revolving
Loan Commitments at any time exceed the Revolving Loan Commitments then
in effect.
(iii) Swing Line Loans. Swing Line Lender hereby agrees,
subject to the limitations set forth below with respect to the maximum
amount of Swing Line Loans permitted to be outstanding from time to
time, to make a portion of the Revolving Loan Commitments available to
Company from time to time during the period from the Closing Date to
but excluding the Revolving Loan Commitment Termination Date by making
Swing Line Loans to Company in an aggregate amount not exceeding the
amount of the Swing Line Loan Commitment to be used for the purposes
identified in subsection 2.5B, notwithstanding the fact that such Swing
Line Loans, when aggregated with Swing Line Lender's outstanding
Revolving Loans and Swing Line Lender's Pro Rata Share of the Letter of
Credit Usage then in effect, may exceed Swing Line Lender's Revolving
Loan Commitment. The original amount of the Swing Line Loan Commitment
is $3 million; provided that any reduction of the Revolving Loan
Commitments made pursuant to subsection 2.4B(ii) or 2.4B(iii) which
reduces the aggregate Revolving Loan Commitments to an amount less than
the then current amount of the Swing Line Loan Commitment shall result
in an automatic corresponding reduction of the Swing Line Loan
Commitment to the amount of the Revolving Loan Commitments, as so
reduced, without any further action on the part of Company,
Administrative Agent or Swing Line Lender. The Swing Line Loan
Commitment shall expire on the Revolving Loan Commitment Termination
Date and all Swing Line Loans and all other amounts owed hereunder with
respect to the Swing Line Loans shall be paid in full no later than
that date. Amounts borrowed under this subsection 2.1A(iii) may be
repaid and reborrowed to but excluding the Revolving Loan Commitment
Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan
Commitment shall be subject to the limitation that in no event shall
the Total Utilization of Revolving Loan Commitments at any time exceed
the Revolving Loan Commitments then in effect.
With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to subsection 2.4B(i), Swing
Line Lender may, at any time in its sole and absolute discretion,
deliver to Administrative Agent (with a copy to Company), no later than
10:00 A.M. (New York City time) on the first Business Day in advance of
the proposed Funding Date, a notice (which shall be deemed to be a
Notice of Borrowing given by Company) requesting Revolving Lenders to
make Revolving Loans that are Base Rate Loans on such Funding Date in
an amount equal to the amount of such Swing Line Loans (the "Refunded
Swing Line Loans") outstanding on the date such notice is given which
Swing Line Lender requests Revolving Lenders to prepay. Anything
contained in this Agreement to the contrary notwithstanding, (i) the
proceeds of such Revolving Loans made by Revolving Lenders other than
Swing Line Lender shall be immediately delivered by Administrative
Agent to Swing Line Lender (and not to Company) and applied to repay a
corresponding portion of the Refunded Swing Line Loans and (ii) on the
day such Revolving Loans are made, Swing Line Lender's Pro Rata Share
of the Refunded Swing Line Loans shall be deemed to be paid with the
proceeds of a Revolving Loan made by Swing Line Lender, and such
portion of the Swing Line Loans deemed to be so paid shall no longer be
outstanding as Swing Line Loans and shall no longer be due under the
Swing Line Note of Swing Line Lender but shall instead constitute part
of Swing Line Lender's outstanding Revolving Loans and shall be due
under the Revolving Note of Swing Line Lender. Company hereby
authorizes Administrative Agent and Swing Line Lender to charge
Company's accounts with Administrative Agent and Swing Line Lender (up
to the amount available in each such account) in order to immediately
pay Swing Line Lender the amount of the Refunded Swing Line Loans to
the extent the proceeds of such Revolving Loans made by Revolving
Lenders, including the Revolving Loan deemed to be made by Swing Line
Lender, are not sufficient to repay in full the Refunded Swing Line
Loans. If any portion of any such amount paid (or deemed to be paid) to
Swing Line Lender should be recovered by or on behalf of Company from
Swing Line Lender in bankruptcy, by assignment for the benefit of
creditors or otherwise, the loss of the amount so recovered shall be
ratably shared among all Revolving Lenders in the manner contemplated
by subsection 10.5.
Immediately upon funding of the Swing Line Loan, each
Revolving Lender shall be deemed to, and hereby agrees to, have
purchased a participation in such outstanding Swing Line Loans in an
amount equal to its Pro Rata Share of the unpaid amount of such Swing
Line Loans together with accrued interest thereon. Upon one Business
Day's notice from Swing Line Lender, each Revolving Lender shall
deliver to Swing Line Lender an amount equal to its respective
participation in same day funds at the Funding and Payment Office. In
the event any Revolving Lender fails to make available to Swing Line
Lender the amount of such Revolving Lender's participation as provided
in this paragraph, Swing Line Lender shall be entitled to recover such
amount on demand from such Revolving Lender together with interest
thereon at the Federal Funds Effective Rate for three Business Days and
thereafter at the Base Rate. In the event Swing Line Lender receives a
payment of any amount in which other Revolving Lenders have purchased
participations as provided in this paragraph, Swing Line Lender shall
promptly distribute to each such other Revolving Lender its Pro Rata
Share of such payment.
Anything contained herein to the contrary notwithstanding,
each Revolving Lender's obligation to make Revolving Loans for the
purpose of repaying any Refunded Swing Line Loans pursuant to the
second preceding paragraph and each Revolving Lender's obligation to
purchase a participation in any unpaid Swing Line Loans pursuant to the
immediately preceding paragraph shall be absolute and unconditional and
shall not be affected by any circumstance, including (a) any set-off,
counterclaim, recoupment, defense or other right which such Revolving
Lender may have against Swing Line Lender, Company or any other Person
for any reason whatsoever; (b) the occurrence or continuation of an
Event of Default or a Potential Event of Default; (c) any adverse
change in the business, operations, properties, assets, condition
(financial or otherwise) or prospects of Company or any of its
Subsidiaries; (d) any breach of this Agreement or any other Loan
Document by any party thereto; or (e) any other circumstance, happening
or event whatsoever, whether or not similar to any of the foregoing;
provided that such obligations of each Revolving Lender are subject to
satisfaction of one of the following conditions (X) Swing Line Lender
believed in good faith that all conditions under Section 4 to the
making of the applicable Refunded Swing Line Loans or unpaid Swing Line
Loans, as the case may be, were satisfied at the time such Refunded
Swing Line Loans or unpaid Swing Line Loans were made or (Y) the
satisfaction of any such condition not satisfied had been waived in
accordance with subsection 10.6 prior to or at the time such Refunded
Swing Line Loans or other unpaid Swing Line Loans were made.
B. Borrowing Mechanics. Loans made on any Funding Date (other than
Revolving Loans made pursuant to a request by Swing Line Lender pursuant to
subsection 2.1A(iii) for the purpose of repaying any Refunded Swing Line Loans
or Revolving Loans made pursuant to subsection 3.3B for the purpose of
reimbursing any Issuing Lender for the amount of a drawing under a Letter of
Credit issued by it) shall be in an aggregate minimum amount of $1 million and
multiples of $100,000 in excess of that amount; provided that Loans made on any
Funding Date as LIBO Rate Loans with a particular Interest Period shall be in an
aggregate minimum amount of $5 million and multiples of $1 million in excess of
that amount. Swing Line Loans made on any Funding Date shall be in an aggregate
minimum amount of $500,000 and multiples of $100,000 in excess of that amount.
Whenever Company desires that Lenders make Loans it shall deliver to
Administrative Agent a Notice of Borrowing no later than 10:00 A.M. (New York
City time) at least three Business Days in advance of the proposed Funding Date
(in the case of a LIBO Rate Loan) or at least one Business Day in advance of the
proposed Funding Date (in the case of a Base Rate Loan). Whenever Company
desires that Swing Line Lender make a Swing Line Loan, it shall deliver to
Administrative Agent a Notice of Borrowing no later than 12:00 Noon (New York
City time) on the proposed Funding Date. The Notice of Borrowing shall specify
(i) the proposed Funding Date (which shall be a Business Day), (ii) the amount
and type of Loans requested, (iii) in the case of Swing Line Loans, that such
Loans shall be Base Rate Loans, (iv) whether such Loans shall be Base Rate Loans
or LIBO Rate Loans, and (v) in the case of any Loans requested to be made as
LIBO Rate Loans, the initial Interest Period requested therefor. Term Loans and
Revolving Loans may be continued as or converted into Base Rate Loans and LIBO
Rate Loans in the manner provided in subsection 2.2D. In lieu of delivering the
above-described Notice of Borrowing, Company may give Administrative Agent
telephonic notice by the required time of any proposed borrowing under this
subsection 2.1B; provided that such notice shall be promptly confirmed in
writing by delivery of a Notice of Borrowing to Administrative Agent on or
before the applicable Funding Date.
Neither Administrative Agent nor any Lender shall incur any liability
to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Company or
for otherwise acting in good faith under this subsection 2.1B, and upon funding
of Loans by Lenders in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected Loans hereunder.
Company shall notify Administrative Agent prior to the funding of any
Loans in the event that any of the matters to which Company is required to
certify in the applicable Notice of Borrowing is no longer true and correct as
of the applicable Funding Date, and the acceptance by Company of the proceeds of
any Loans shall constitute a re-certification by Company, as of the applicable
Funding Date, as to the matters to which Company is required to certify in the
applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Borrowing for a LIBO Rate Loan (or telephonic notice in lieu thereof)
shall be irrevocable on and after the related Interest Rate Determination Date,
and Company shall be bound to make a borrowing in accordance therewith.
C. Disbursement of Funds. All Loans (other than Swing Line Loans) under
this Agreement shall be made by Lenders simultaneously and proportionately to
their respective Pro Rata Shares of the Tranche A Term Loan Commitment and the
Revolving Loan Commitment, as the case may be, it being understood that no
Lender shall be responsible for any default by any other Lender in that other
Lender's obligation to make a Loan requested hereunder nor shall the Commitment
of any Lender to make the particular type of Loan requested be increased or
decreased as a result of a default by any other Lender in that other Lender's
obligation to make a Loan requested hereunder. Promptly after receipt by
Administrative Agent of a Notice of Borrowing pursuant to subsection 2.1B (or
telephonic notice in lieu thereof), Administrative Agent shall notify each
Lender or Swing Line Lender, as the case may be, of the proposed borrowing. Each
Lender shall make the amount of its Loan available to Administrative Agent not
later than 1:00 P.M. (New York City time) on the applicable Funding Date, and
Swing Line Lender shall make the amount of its Swing Line Loan available to
Administrative Agent not later than 2:00 P.M. (New York City time) on the
applicable Funding Date, in each case in same day funds in Dollars, at the
Funding and Payment Office. Except as provided in subsection 2.1A(iii) or
subsection 3.3B with respect to Revolving Loans used to repay Refunded Swing
Line Loans or to reimburse any Issuing Lender for the amount of a drawing under
a Letter of Credit issued by it, upon satisfaction or waiver of the conditions
precedent specified in subsections 4.1 (in the case of Loans made on the Closing
Date), 4.2 (in the case of Loans made on the Merger Date) and 4.3 (in the case
of all Loans), Administrative Agent shall make the proceeds of such Loans
available to Company on the applicable Funding Date by causing an amount of same
day funds in Dollars equal to the proceeds of all such Loans received by
Administrative Agent from Lenders or Swing Line Lender, as the case may be, to
be credited to the account of Company at the Funding and Payment Office.
Unless Administrative Agent shall have been notified by any Lender
prior to the Funding Date for any Loans that such Lender does not intend to make
available to Administrative Agent the amount of such Lender's Loan requested on
such Funding Date, Administrative Agent may assume that such Lender has made
such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Company a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon,
for each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the Federal Funds Effective Rate for three Business
Days and thereafter at the Base Rate. If such Lender does not pay such
corresponding amount forthwith upon Administrative Agent's demand therefor,
Administrative Agent shall promptly notify Company and Company shall immediately
pay such corresponding amount to Administrative Agent together with interest
thereon, for each day from such Funding Date until the date such amount is paid
to Administrative Agent, at the rate payable under this Agreement for Base Rate
Loans. Nothing in this subsection 2.1C shall be deemed to relieve any Lender
from its obligation to fulfill its Commitments hereunder or to prejudice any
rights that Company may have against any Lender as a result of any default by
such Lender hereunder.
D. The Register.
(i) Administrative Agent shall maintain, at its address
referred to in subsection 10.8, a register for the recordation of the
names and addresses of Lenders and the Commitments and Loans of each
Lender from time to time (the "Register"). The Register shall be
available for inspection by Company or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the
Tranche A Term Loan Commitment and Revolving Loan Commitment and the
Tranche A Term Loan and Revolving Loans from time to time of each
Lender, the Swing Line Loan Commitment and the Swing Line Loans from
time to time of Swing Line Lender, and each repayment or prepayment in
respect of the principal amount of the Tranche A Term Loan or Revolving
Loans of each Lender or the Swing Line Loans of Swing Line Lender. Any
such recordation shall be conclusive and binding on Company and each
Lender, absent error; provided that failure to make any such
recordation, or any error in such recordation, shall not affect any
Lender's Commitments or Company's Obligations in respect of any
applicable Loans.
(iii) Each Lender shall record on its internal records
(including, without limitation, the Notes held by such Lender) the
amount of the Tranche A Term Loan and each Revolving Loan made by it
and each payment in respect thereof. Any such recordation shall be
conclusive and binding on Company, absent error; provided that failure
to make any such recordation, or any error in such recordation, shall
not affect any Lender's Commitments or Company's Obligations in respect
of any applicable Loans; and provided further that in the event of any
inconsistency between the Register and any Lender's records, the
recordations in the Register shall govern.
(iv) Company, Administrative Agent and Lenders shall deem and
treat the Persons listed as Lenders in the Register as the holders and
owners of the corresponding Commitments and Loans listed therein for
all purposes hereof, and no assignment or transfer of any such
Commitment or Loan shall be effective, in each case unless and until an
Assignment Agreement effecting the assignment or transfer thereof shall
have been accepted by Administrative Agent and recorded in the Register
as provided in subsection 10.1B(ii). Prior to such recordation, all
amounts owed with respect to the applicable Commitment or Loan shall be
owed to the Lender listed in the Register as the owner thereof, and any
request, authority or consent of any Person who, at the time of making
such request or giving such authority or consent, is listed in the
Register as a Lender shall be conclusive and binding on any subsequent
holder, assignee or transferee of the corresponding Commitments or
Loans.
(v) Company hereby designates Administrative Agent to serve as
Company's agent solely for purposes of maintaining the Register as
provided in this subsection 2.1D, and Company hereby agrees that, to
the extent Administrative Agent serves in such capacity, Administrative
Agent and its officers, directors and employees shall constitute
Indemnitees for all purposes under subsection 10.3.
E. Evidence of Debt.
(i) The Register maintained by the Administrative Agent
pursuant to Section 2.1D shall include a control account, and a
subsidiary account for each Lender, in which accounts (taken together)
shall be recorded (i) the date, amount and tenor, as applicable, of
each Loan, the type of Loan and the Interest Period applicable thereto,
(ii) the terms of each Assignment Agreement delivered to and accepted
by it, (iii) the amount of any principal or interest due and payable or
to become due and payable from the Company to each Lender hereunder,
and (iv) the amount of any sum received by the Administrative Agent
from the Company hereunder and each Lender's share thereof.
(ii) The entries made in the Register shall be conclusive and
binding for all purposes, absent manifest error.
(iii) If, in the opinion of any Lender, a promissory note or
other evidence of debt is required, appropriate or desirable to reflect
or enforce the indebtedness of the Company resulting from a Tranche A
Loan, a Revolving Loan or a Swing Line Loan made, or to be made, by
such Lender to the Company, then, upon request of such Lender, the
Company shall promptly execute and deliver to such Lender a promissory
note substantially in the form of Exhibit IV-A in the case of Tranche A
Loans, Exhibit IV-B in the case of Revolving Loans and Exhibit IV-C in
the case of Swing Line Loans, payable to the order of such Lender in an
amount up to the maximum amount of Tranche A Loans, Revolving Loans or
Swing Line Loans, as the case may be, payable or to be payable by
Company to the Lender from time to time hereunder.
(iv) Administrative Agent may deem and treat the payee of any
Note as the owner thereof for all purposes hereof unless and until an
Assignment Agreement effecting the assignment or transfer thereof shall
have been accepted by Administrative Agent as provided in subsection
10.1B(ii). Any request, authority or consent of any person or entity
who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on
any subsequent holder, assignee or transferee of that Note or of any
Note or Notes issued in exchange therefor.
F. Special Provisions Governing Foreign Currency Letters of Credit.
Notwithstanding any other provision of this Agreement to the contrary, the
following provisions shall govern with respect to Letters of Credit denominated
in a currency other than Dollars, in each case as to the matters covered:
(i) Calculation of Dollar Equivalent Amount of Foreign
Currency Letters of Credit. For purposes of determining (1) whether the
Total Utilization of Commitments exceeds the Revolving Loan Commitments
then in effect or (2) the Letter of Credit Usage, Administrative Agent
shall determine the Dollar Equivalent amounts with respect to any
Letters of Credit denominated in a currency other than Dollars (a) on
the first Business Day following each monthly anniversary of the
issuance of such Letter of Credit, and (b) at such other dates as
Administrative Agent may reasonably require (each such date under
clauses (a) and (b) being a "Computation Date"). Administrative Agent
shall determine the Dollar Equivalent amount for a particular Letter of
Credit at the time a Request for Issuance of Letter of Credit is given
with respect to such Letter of Credit.
(ii) European Economic and Monetary Union. The European
Economic and Monetary Union (the "European Monetary Union") anticipates
the introduction of a single currency and the substitution of such
currency for the national currencies of the member states participating
in the European Monetary Union. On the date on which any currency under
which a Letter of Credit is issued is replaced by such single currency,
the conversion of any outstanding Letters of Credit denominated in such
foreign currency into such single currency shall take effect; provided
that the original foreign currency shall be retained for so long as
legally permissible; provided further that any such conversion shall be
based on the rate of conversion officially fixed by the European
Monetary Union on the date such single currency replaces the applicable
foreign currency. Notwithstanding anything contained herein to the
contrary, none of the introduction of such single currency, the rate of
conversion nor any economic consequences that arise from any of the
aforementioned events or otherwise in connection with the European
Monetary Union shall give rise to any right to terminate prematurely,
contest, cancel, rescind, modify or renegotiate this Agreement or any
of its provisions or to raise any other objections and/or exceptions or
to assert any claim for compensation.
(iii) Limitation to Permitted Currencies. Letters of Credit
issued in a currency other than Dollars shall only be issued in a
Permitted Currency.
2.2 Interest on the Loans
A. Rate of Interest. Subject to the provisions of subsections 2.6 and
2.7, each Loan shall bear interest on the unpaid principal amount thereof from
the date made through maturity (whether by acceleration or otherwise) at a rate
determined by reference to the Base Rate or the Adjusted LIBO Rate. Subject to
the provisions of subsection 2.7, each Swing Line Loan shall bear interest on
the unpaid principal amount thereof from the date made through maturity (whether
by acceleration or otherwise) at a rate determined by reference to the Base
Rate. The applicable basis for determining the rate of interest with respect to
any Loan shall be selected by Company initially at the time a Notice of
Borrowing is given with respect to such Loan pursuant to subsection 2.1B, and
the basis for determining the interest rate with respect to any Loan may be
changed from time to time pursuant to subsection 2.2D. If on any day a Loan is
outstanding with respect to which notice has not been delivered to
Administrative Agent in accordance with the terms of this Agreement specifying
the applicable basis for determining the rate of interest, then for that day
that Loan shall bear interest determined by reference to the Base Rate.
(i) Subject to the provisions of subsections 2.2E and 2.7, the
Tranche A Term Loans and the Revolving Loans shall bear interest
through maturity as follows:
(1) if a Base Rate Loan, then at the sum of the Base Rate
plus the Applicable Base Rate Margin or
(2) if a LIBO Rate Loan, then at the sum of the Adjusted
LIBO Rate plus the Applicable LIBO Rate Margin.
(ii) Subject to the provisions of subsections 2.2E and 2.7,
the Swing Line Loans shall bear interest through maturity at the sum of
the Base Rate plus the Applicable Base Rate Margin for Revolving Loans
minus the Commitment Fee Percentage.
Upon delivery of a Margin Determination Certificate by Company to
Administrative Agent pursuant to subsection 6.1(xvii), each of the Applicable
Base Rate Margin and the Applicable LIBO Rate Margin shall automatically be
adjusted in accordance with such Margin Determination Certificate, such
adjustment to become effective on the next succeeding Business Day following the
receipt by Administrative Agent of such Margin Determination Certificate;
provided that if at any time a Margin Determination Certificate is not delivered
at the time required pursuant to subsection 6.1(xvii), the highest Applicable
Base Rate Margin or Applicable LIBO Rate Margin, as the case may be, shall be
applicable from such time until delivery of such Margin Determination
Certificate; provided further that if a Margin Determination Certificate
erroneously indicates an applicable margin more favorable to Company than should
be afforded by the actual calculation of the Consolidated Leverage Ratio,
Company shall promptly pay additional interest, letter of credit fees and all
other applicable fees or commitment fees, as the case may be, to correct such
error.
B. Interest Periods. In connection with each LIBO Rate Loan, Company
may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"Interest Period") to be applicable to such Loan, which Interest Period shall
be, at Company's option, either a one, two, three or six month period; provided
that:
(i) the initial Interest Period for any LIBO Rate Loan shall
commence on the Funding Date in respect of such Loan, in the case of a
Loan initially made as a LIBO Rate Loan, or on the date specified in
the applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a LIBO Rate Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a LIBO Rate Loan continued as such pursuant to a Notice
of Conversion/ Continuation, each successive Interest Period shall
commence on the day on which the next preceding Interest Period
expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the
Tranche A Term Loans shall extend beyond the last day of the Fiscal
Quarter ending on or about April 30, 2005 and no Interest Period with
respect to any portion of the Revolving Loans shall extend beyond the
Revolving Loan Commitment Termination Date;
(vi) no Interest Period with respect to any portion of the
Tranche A Term Loans shall extend beyond a date on which Company is
required to make a scheduled payment of principal of the Tranche A Term
Loans unless the sum of (a) the aggregate principal amount of Tranche A
Term Loans that are Base Rate Loans plus (b) the aggregate principal
amount of Tranche A Term Loans that are LIBO Rate Loans with Interest
Periods expiring on or before such date equals or exceeds the principal
amount required to be paid on the Tranche A Term Loans on such date;
(vii) there shall be no more than five (5) Interest Periods
outstanding at any time; and
(viii) in the event Company fails to specify an Interest
Period for any LIBO Rate Loan in the applicable Notice of Borrowing or
Notice of Conversion/Continuation, Company shall be deemed to have
selected an Interest Period of one month.
C. Interest Payments. Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event any Swing Line Loans or any Revolving
Loans that are Base Rate Loans are prepaid pursuant to subsection 2.4B(i),
interest accrued on such Swing Line Loans or Revolving Loans through the date of
such prepayment shall be payable on the next succeeding Interest Payment Date
applicable to Base Rate Loans (or, if earlier, at final maturity).
D. Conversion or Continuation. Subject to the provisions of subsection
2.6, Company shall have the option to convert at any time all or any part of its
outstanding Loans equal to $5 million and multiples of $1 million in excess of
that amount from Loans bearing interest at a rate determined by reference to one
basis to Loans bearing interest at a rate determined by reference to an
alternative basis or (ii) upon the expiration of any Interest Period applicable
to a LIBO Rate Loan, to continue all or any portion of such Loan equal to $5
million and multiples of $1 million in excess of that amount as a LIBO Rate
Loan; provided, however, that (i) a LIBO Rate Loan may only be converted into a
Base Rate Loan on the expiration date of an Interest Period applicable thereto.
Company shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 10:00 A.M. (New York City time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a LIBO Rate Loan). A Notice of Conversion/Continuation shall
specify (i) the proposed conversion/continuation date (which shall be a Business
Day), (ii) the amount and type of the Loan to be converted/continued, (iii) the
nature of the proposed conversion/continuation, (iv) in the case of a conversion
to, or a continuation of, a LIBO Rate Loan, the requested Interest Period, and
(v) in the case of a conversion to, or a continuation of, a LIBO Rate Loan, that
no Potential Event of Default or Event of Default has occurred and is
continuing. In lieu of delivering the above-described Notice of
Conversion/Continuation, Company may give Administrative Agent telephonic notice
by the required time of any proposed conversion/continuation under this
subsection 2.2D; provided that such notice shall be promptly confirmed in
writing by delivery of a Notice of Conversion/ Continuation to Administrative
Agent on or before the proposed conversion/continuation date. Upon receipt of
written or telephonic notice of any proposed conversion/continuation under this
subsection 2.2D, Administrative Agent shall promptly transmit such notice by
telefacsimile or telephone to each Lender.
Neither Administrative Agent nor any Lender shall incur any liability
to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Company or for
otherwise acting in good faith under this subsection 2.2D, and upon conversion
or continuation of the applicable basis for determining the interest rate with
respect to any Loans in accordance with this Agreement pursuant to any such
telephonic notice Company shall have effected a conversion or continuation, as
the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Conversion/Continuation for conversion to, or continuation of, a LIBO
Rate Loan (or telephonic notice in lieu thereof) shall be irrevocable on and
after the related Interest Rate Determination Date, and Company shall be bound
to effect a conversion or continuation in accordance therewith.
E. Default Rate. Upon the occurrence and during the continuation of any
Event of Default, the outstanding principal amount of all Loans and, to the
extent permitted by applicable law, any interest payments thereon not paid when
due and any fees and other amounts then due and payable hereunder, shall
thereafter bear interest (including post-petition interest in any proceeding
under the Bankruptcy Code or other applicable bankruptcy laws) payable upon
demand at a rate that is 2.00% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2.00% per
annum in excess of the interest rate otherwise payable under this Agreement for
Base Rate Loans); provided that, in the case of LIBO Rate Loans, upon the
expiration of the Interest Period in effect at the time any such increase in
interest rate is effective such LIBO Rate Loans shall thereupon become Base Rate
Loans and shall thereafter bear interest payable upon demand at a rate which is
2.00% per annum in excess of the interest rate otherwise payable under this
Agreement for Base Rate Loans. Payment or acceptance of the increased rates of
interest provided for in this subsection 2.2E is not a permitted alternative to
timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of any Agent or any Lender.
F. Computation of Interest. Interest on the Loans shall be computed on
the basis of a 360-day year, in each case for the actual number of days elapsed
in the period during which it accrues. In computing interest on any Loan, the
date of the making of such Loan or the first day of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan being converted
from a LIBO Rate Loan, the date of conversion of such LIBO Rate Loan to such
Base Rate Loan, as the case may be, shall be included, and the date of payment
of such Loan or the expiration date of an Interest Period applicable to such
Loan or, with respect to a Base Rate Loan being converted to a LIBO Rate Loan,
the date of conversion of such Base Rate Loan to such LIBO Rate Loan, as the
case may be, shall be excluded; provided that if a Loan is repaid on the same
day on which it is made, one day's interest shall be paid on that Loan.
2.3 Fees
A. Commitment Fees.
(i) Revolving Loan Commitments. Company agrees to pay to
Administrative Agent, for distribution to each Revolving Lender in
proportion to that Lender's Pro Rata Share of the Revolving Loan
Commitments, commitment fees for the period from and including the
Closing Date to and excluding the Revolving Loan Commitment Termination
Date equal to (x) the average of the daily excess of the Revolving Loan
Commitments over the Total Utilization of Revolving Loan Commitments
(but not including any outstanding Swing Line Loans) multiplied by (y)
the Commitment Fee Percentage, such commitment fees to be calculated on
the basis of a 360-day year and the actual number of days elapsed and
to be payable quarterly in arrears on the last Business Day of each
March, June, September and December of each year, commencing on the
first such date to occur after the Closing Date, and on the Revolving
Loan Commitment Termination Date.
(ii) Tranche A Term Loan Commitments. Company agrees to pay to
Administrative Agent, for distribution to each Tranche A Term Loan
Lender in proportion to that Tranche A Term Loan Lender's Pro Rata
Share of the Tranche A Term Loan Commitments, commitment fees for the
period from and including the Closing Date to and excluding the Merger
Date (or, if earlier, the date of termination of the Tranche A Term
Loan Commitments in their entirety) equal to (x) the aggregate original
principal amount of the Tranche A Term Loan Commitments minus the
aggregate principal amount of outstanding Tranche A Term Loans
multiplied by (y) 2.50% per annum; such commitment fees to be
calculated on the basis of a 360-day year and the actual number of days
elapsed and to be payable quarterly on the last Business Day of the
Fiscal Quarter ending on or about the last day of each October,
January, April and July, commencing on the first such date to occur
after the Closing Date, and on the Merger Date.
B. Other Fees. Company agrees to pay to Arranger and Administrative
Agent such other fees in the amounts and at the times separately agreed upon
between Company, Arranger and Administrative Agent.
2.4 Repayments, Prepayments and Reductions in Loan Commitments; General
Provisions Regarding Payments
A. Scheduled Payments of Tranche A Term Loans.
Company shall make principal payments on the Tranche A Term Loans on
the last Business Day of the Fiscal Quarter ending on or about each of the
following dates in the aggregate amount set forth opposite such date in the
table set forth below:
-----------------------------------------------------------------------
Scheduled Repayment
Scheduled Repayment Date of Tranche A Term Loans
-----------------------------------------------------------------------
July 31, 2000 $1,750,000
October 31, 2000 $1,750,000
January 31, 2001 $1,750,000
April 30, 2001 $1,750,000
July 31, 2001 $2,625,000
October 31, 2001 $2,625,000
January 31, 2002 $2,625,000
April 30, 2002 $2,625,000
July 31, 2002 $3,500,000
October 30, 2002 $3,500,000
January 31, 2003 $3,500,000
April 30, 2003 $3,500,000
July 31, 2003 $4,375,000
October 31, 2003 $4,375,000
January 31, 2004 $4,375,000
April 30, 2004 $4,375,000
July 31, 2004 $5,250,000
October 31, 2004 $5,250,000
January 31, 2005 $5,250,000
April 30, 2005 $5,250,000
----------------------------
Total $70,000,000
; provided that the scheduled installments of principal of the Tranche A
Term Loans set forth above shall be reduced in connection with any voluntary
or mandatory prepayments of the Tranche A Term Loans in accordance with
subsection 2.4B(iv); and provided further that the Tranche A Term Loans and all
other amounts owed hereunder with respect to the Tranche A Term Loans shall be
paid in full no later than the last Business Day of the Fiscal Quarter ending on
or about April 30, 2005, and the final installment payable by Company in respect
of the Tranche A Term Loans on such date shall be in an amount, if such amount
is different from that specified above, sufficient to repay all amounts owing by
Company under this Agreement with respect to the Tranche A Term Loans.
B. Prepayments and Unscheduled Reductions in Revolving Loan
Commitments.
(i) Voluntary Prepayments.
(a) Company may, upon written or telephonic notice to
Administrative Agent on or prior to 12:00 Noon (New York City time) on
the date of prepayment, which notice, if telephonic, shall be promptly
confirmed in writing, at any time and from time to time prepay, without
premium or penalty, any Swing Line Loan on any Business Day in whole or
in part in an aggregate minimum amount of $500,000 and multiples of
$100,000 in excess of that amount. Company may, upon not less than one
Business Day's prior written or telephonic notice, in the case of Base
Rate Loans, and three Business Days' prior written or telephonic
notice, in the case of LIBO Rate Loans, in each case given to
Administrative Agent by 12:00 Noon (New York City time) on the date
required and, if given by telephone, promptly confirmed in writing to
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or
telephone to each Lender), at any time and from time to time prepay,
without premium or penalty, any Loans on any Business Day in whole or
in part in an aggregate minimum amount of $1 million and multiples of
$100,000 in excess of that amount; provided, however, that a LIBO Rate
Loan may only be prepaid on the expiration of the Interest Period
applicable thereto unless Company complies with subsection 2.6D with
respect to any breakage costs resulting from such prepayment being made
on a date prior to the expiration of the applicable Interest Period.
Notice of prepayment having been given as aforesaid, the principal
amount of the Loans specified in such notice shall become due and
payable on the prepayment date specified therein. Any such voluntary
prepayment shall be applied as specified in subsection 2.4B(iv).
(b) In the event Company is entitled to replace a
non-consenting Lender pursuant to subsection 10.6B, Company shall have
the right, upon five Business Days' written notice to Administrative
Agent (which notice Administrative Agent shall promptly transmit to
each of the Lenders), to prepay all Loans, together with accrued and
unpaid interest, fees and other amounts owing to such Lender (including
without limitation amounts owing to such Lender pursuant to subsection
2.6D) in accordance with subsection 10.6B so long as (1) in the case of
the prepayment of the Revolving Loans of any Lender pursuant to this
subsection 2.4B(i)(b), the Revolving Loan Commitment of such Lender is
terminated concurrently with such prepayment pursuant to subsection
2.4B(ii)(b) (at which time Schedule 2.1 shall be deemed modified to
reflect the changed Revolving Loan Commitments), and (2) in the case of
the prepayment of the Loans of any Lender, the consents required by
subsection 10.6B in connection with the prepayment pursuant to this
subsection 2.4B(i)(b) shall have been obtained, and at such time, such
Lender shall no longer constitute a "Lender" for purposes of this
Agreement, except with respect to indemnifications under this Agreement
(including, without limitation, subsections 2.6D, 2.7, 3.6, 10.2 and
10.3), which shall survive as to such Lender.
(ii) Voluntary Reductions of Loan Commitments.
(a) Company may, upon not less than three Business
Days' prior written or telephonic notice confirmed in writing to
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or
telephone to each Revolving Lender), at any time and from time to time
terminate in whole or permanently reduce in part, without premium or
penalty, the Revolving Loan Commitments in an amount up to the amount
by which the Revolving Loan Commitments exceed the Total Utilization of
Revolving Loan Commitments at the time of such proposed termination or
reduction; provided that any such partial reduction shall be in an
aggregate minimum amount of $1 million and multiples of $100,000 in
excess of that amount. Company's notice to Administrative Agent shall
designate the date (which shall be a Business Day) of such termination
or reduction and the amount of any partial reduction, and such
termination or reduction of the Revolving Loan Commitments shall be
effective on the date specified in Company's notice and shall reduce
the Revolving Loan Commitment of each Revolving Lender proportionately
to its Pro Rata Share.
(b) In the event Company is entitled to replace a
non-consenting Lender pursuant to subsection 10.6B, Company shall have
the right, upon five Business Days' written notice to Administrative
Agent (which notice Administrative Agent shall promptly transmit to
each of the Lenders), to terminate the entire Revolving Loan Commitment
of such Lender so long as (1) all Loans, together with accrued and
unpaid interest, fees and other amounts owing to such Lender are
repaid, including without limitation amounts owing to such Lender
pursuant to subsection 2.6D, pursuant to subsection 2.4B(i)(b)
concurrently with the effectiveness of such termination (at which time
Schedule 2.1 shall be deemed modified to reflect such changed amounts),
and (2) the consents required by subsection 10.6B in connection with
the prepayment pursuant to subsection 2.4B(i)(b) shall have been
obtained, and at such time, such Lender shall no longer constitute a
"Lender" for purposes of this Agreement, except with respect to
indemnifications under this Agreement (including, without limitation,
subsections 2.6D, 2.7, 3.6, 10.2 and 10.3), which shall survive as to
such Lender.
(iii) Mandatory Prepayments and Mandatory Reductions of Loan
Commitments. The Loans shall be prepaid and/or the Revolving Loan
Commitments shall be permanently reduced in the amounts and under the
circumstances set forth below, all such prepayments and/or reductions
to be applied as set forth below or as more specifically provided in
subsection 2.4B(iv); provided however that prior to the Merger Date,
no prepayment and/or Revolving Loan Commitment reduction shall be
required as a result of (i) any Asset Sale of Shelby Common Stock or
(ii) any receipt of Net Asset Sale Proceeds or Net Insurance/
Condemnation Proceeds by Shelby and its Subsidiaries:
(a) Prepayments and Reductions From Net Asset Sale
Proceeds. No later than the first Business Day following the date of
receipt by Company or any of its Subsidiaries of any Net Asset Sale
Proceeds in respect of any Asset Sale, Company shall prepay the Loans
and/or the Revolving Loan Commitments shall be permanently reduced in
an aggregate amount equal to 100% of such Net Asset Sale Proceeds minus
any such Net Asset Sale Proceeds (the "Proposed Asset Sale Reinvestment
Proceeds") that Company or any Subsidiary intends to use within 360
days of such date of receipt to acquire any asset used or useful to the
Company or such Subsidiary in conducting its business; provided that
Company shall have delivered to Administrative Agent, on or before such
first Business Day, an Officers' Certificate setting forth the proposed
use of the Proposed Asset Sale Reinvestment Proceeds and such other
information with respect to such proposed use as Administrative Agent
may reasonably request. In addition, no later than 360 days after
receipt of any Net Asset Sale Proceeds, Company shall prepay the Loans
and/or the Revolving Loan Commitments shall be permanently reduced in
an amount equal to the amount of any related Proposed Asset Sale
Reinvestment Proceeds that have not been applied to the purchase of an
asset by Company or such Subsidiary as provided above; provided further
that the aggregate amount of any such Proposed Asset Sale Reinvestment
Proceeds so reinvested in the business of Company or any Subsidiary
shall not exceed $10 million for any Fiscal Year;
If, following the receipt by Company or any of its
Subsidiaries of any Net Asset Sale Proceeds, Company is required to
apply or cause to be applied any portion of such Net Asset Sale
Proceeds to prepay any Indebtedness evidenced by any of the Related
Agreements pursuant to the applicable Related Agreement, then,
notwithstanding anything contained in this subsection 2.4B(iii)(a),
Company shall prepay the Loans and/or reduce the Revolving Loan
Commitments as set forth in this subsection 2.4B(iii)(a) so as to
eliminate any obligation to prepay such Indebtedness.
(b) Prepayments and Reductions from Net
Insurance/Condemnation Proceeds. No later than the first Business Day
following the date of receipt by Administrative Agent or by Company or
any of its Subsidiaries of any Net Insurance/Condemnation Proceeds,
Company shall, or shall instruct the Administrative Agent to, prepay
the Loans and/or the Revolving Loan Commitments shall be permanently
reduced in an aggregate amount equal to 100% of the amount of such Net
Insurance/Condemnation Proceeds minus any such Net Insurance/
Condemnation Proceeds (the "Proposed Reinvestment Proceeds") that
Company or such Subsidiary intends to use within 360 days of such date
of receipt to pay or reimburse the costs of repairing, restoring or
replacing the assets in respect of which such Net Insurance/
Condemnation Proceeds were received; provided that Company shall have
delivered to Administrative Agent, on or before such first Business
Day, an Officers' Certificate setting forth the proposed use of the
Proposed Reinvestment Proceeds and such other information with respect
to such proposed use as Administrative Agent may reasonably request. In
addition, no later than 360 days after receipt of any Net
Insurance/Condemnation Proceeds, Company shall prepay the Loans and/or
the Revolving Loan Commitments shall be permanently reduced in an
amount equal to the amount of any related Proposed Reinvestment
Proceeds that have not been applied to the costs of repairing,
restoring or replacing the applicable assets of Company or such
Subsidiary as provided above; provided further that the aggregate
amount of any such Proposed Reinvestment Proceeds so applied to such
repair, restoration or replacement shall not exceed $10 million for any
Fiscal Year;
(c) Prepayments and Reductions Due to Issuance of
Equity Securities. No later than the first Business Day following
receipt by Company or any of its Subsidiaries of the Cash proceeds (any
such Cash proceeds, net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith, including
reasonable legal fees and expenses, being "Net Equity Securities
Proceeds"), from the issuance of equity Securities of Company (other
than proceeds from common equity Securities of Company issued to
officers, employees, directors, consultants and certain other qualified
persons of Company and its Subsidiaries pursuant to option plans or
other similar plans or agreements adopted by Company's Board of
Directors), Company shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount equal
to 50% of such Net Equity Securities Proceeds; provided that if the
Consolidated Leverage Ratio on the last day of the four Fiscal Quarter
period most recently ended prior to the date of receipt of such Net
Securities Proceeds for which Company has delivered a Margin
Determination Certificate to Administrative Agent pursuant to
subsection 6.1(xvii) is less than or equal to 3.00:1.00, such
percentage shall be reduced to 0.
(d) Prepayments and Reductions Due to Issuance of
Debt Securities. No later than the first Business Day following receipt
by Company or any of its Subsidiaries of the Cash proceeds (any such
Cash proceeds, net of underwriting discounts and commissions and other
reasonable costs and expenses associated therewith, including
reasonable legal fees and expenses, being "Net Debt Securities
Proceeds"), from the issuance of debt Securities of Company or any of
its Subsidiaries after the Closing Date (other than Net Debt Securities
Proceeds of Indebtedness permitted under subsection 7.1 as in effect on
the Closing Date, except for Senior Subordinated Debt Securities issued
pursuant to subsection 7.1(vi) which are not used to make Permitted
Acquisitions), Company shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate amount equal
to 100% of such Net Debt Securities Proceeds.
(e) Prepayments and Reductions from Consolidated
Excess Cash Flow. In the event that there shall be Consolidated Excess
Cash Flow for any Fiscal Year (commencing with the Fiscal Year ending
on or about October 31, 2000), Company shall, no later than ninety (90)
days after the end of such Fiscal Year, prepay the Loans and/or the
Revolving Loan Commitments shall be permanently reduced in an aggregate
amount equal to 75% of such Consolidated Excess Cash Flow.
(f) Prepayments Due to Restrictions on Revolving
Loans Commitments or Currency Fluctuations. Company shall from time to
time prepay first the Swing Line Loans and second the Revolving Loans
to the extent necessary so that the Total Utilization of Revolving Loan
Commitments shall not exceed the Revolving Loan Commitments then in
effect. If on any Computation Date Administrative Agent shall have
determined that the Total Utilization of Revolving Loan Commitments
exceeds the Revolving Loan Commitments because of a change in
applicable rates of exchange between Dollars and any other currency
under which a Letter of Credit has been issued, then Administrative
Agent shall give notice to the Company that a prepayment is required
under this subsection 2.4B(iii)(f) and Company shall promptly (x)
prepay first its Swing Line Loans and second its Revolving Loans and/or
(y) cash collateralize its outstanding Letters of Credit by depositing
Dollars into the Collateral Account established under the Collateral
Account Agreement, in each case to the extent necessary so that the
Total Utilization of Revolving Loan Commitments shall not exceed the
Revolving Loan Commitments.
(g) Calculations of Net Proceeds Amounts; Additional
Prepayments and Reductions Based on Subsequent Calculations.
Concurrently with any prepayment of the Loans and/or reduction of the
Revolving Loan Commitments pursuant to subsections 2.4B(iii)(a)-(e),
Company shall deliver to Administrative Agent an Officers' Certificate
demonstrating the calculation of the amount (the "Net Proceeds Amount")
of the applicable Net Asset Sale Proceeds or Net Insurance/Condemnation
Proceeds, or Net Equity Securities Proceeds (as such term is defined in
subsection 2.4B(iii)(c)) or Net Debt Securities Proceeds (as such term
is defined in subsection 2.4B(iii)(d)) or the applicable Consolidated
Excess Cash Flow, as the case may be, that gave rise to such prepayment
and/or reduction. In the event that Company shall subsequently
determine that the actual Net Proceeds Amount was greater than the
amount set forth in such Officers' Certificate, Company shall promptly
make an additional prepayment of the Loans (and/or, if applicable, the
Revolving Loan Commitments shall be permanently reduced) in an amount
equal to the amount of such excess, and Company shall concurrently
therewith deliver to Administrative Agent an Officers' Certificate
demonstrating the derivation of the additional Net Proceeds Amount
resulting in such excess.
(iv) Application of Prepayments.
(a) Application of Voluntary Prepayments by Type of
Loans and Order of Maturity. Any voluntary prepayments pursuant to
subsection 2.4B(i) shall be applied to the Loans as specified by
Company in the applicable notice of prepayment; provided that in the
event Company fails to specify the Loans to which any such prepayment
shall be applied, such prepayment shall be applied first to repay
outstanding Swing Line Loans to the full extent thereof, second to
repay outstanding Revolving Loans to the full extent thereof and third
to repay outstanding Tranche A Term Loans to the full extent thereof.
Any voluntary prepayments of the Term Loans pursuant to subsection
2.4B(i) (whether the application thereof is specified by Company or
not) shall be applied to reduce the scheduled installments of principal
of the Tranche A Term Loans set forth in subsection 2.4A on a pro rata
basis.
(b) Application of Mandatory Prepayments by Type of
Loans. Any amount (the "Applied Amount") required to be applied as a
mandatory prepayment of the Loans and/or a reduction of the Revolving
Loan Commitments pursuant to subsections 2.4B(iii)(a)-(e) shall be
applied first to prepay the Term Loans to the full extent thereof as
provided in subsection 2.4B(iv)(c), second, to the extent of any
remaining portion of the Applied Amount, to prepay the Swing Line Loans
to the full extent thereof and to permanently reduce the Revolving Loan
Commitments by the amount of such prepayment, third, to the extent of
any remaining portion of the Applied Amount, to prepay the Revolving
Loans to the full extent thereof and to further permanently reduce the
Revolving Loan Commitments by the amount of such prepayments, and
fourth, to the extent of any remaining portion of the Applied Amount,
to further permanently reduce the Revolving Loan Commitments to the
full extent thereof.
(c) Application of Mandatory Prepayments of Term
Loans to Tranche A Term Loans and the Scheduled Installments of
Principal Thereof. Any mandatory prepayments of the Term Loans pursuant
to subsection 2.4B(iii) shall be applied to prepay the Tranche A Term
Loans. All mandatory prepayments of the Term Loans pursuant to
subsection 2.4B(iii) shall reduce the scheduled installments of
principal of the Tranche A Term Loans set forth in subsection 2.4A on a
pro rata basis.
(d) Application of Prepayments to Base Rate Loans and
LIBO Rate Loans. Considering Tranche A Term Loans and Revolving Loans
being prepaid separately, any prepayment thereof shall be applied first
to Base Rate Loans to the full extent thereof before application to
LIBO Rate Loans, in each case in a manner which minimizes the amount of
any payments required to be made by Company pursuant to subsection
2.6D.
C. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Company of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 12:00 Noon (New York
City time) on the date due at the Funding and Payment Office for the
account of Lenders; funds received by Administrative Agent after that
time on such due date shall be deemed to have been paid by Company on
the next succeeding Business Day. Company hereby authorizes
Administrative Agent to charge its accounts with Administrative Agent
in order to cause timely payment to be made to Administrative Agent of
all principal, interest, fees and expenses due hereunder (subject to
sufficient funds being available in its accounts for that purpose).
(ii) Application of Payments to Principal and Interest. Except
as provided in subsection 2.2C, all payments in respect of the
principal amount of any Loan shall include payment of accrued interest
on the principal amount being repaid or prepaid, and all such payments
(and, in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be applied
to the payment of interest before application to principal.
(iii) Apportionment of Payments. Aggregate principal and
interest payments in respect of Loans shall be apportioned among all
outstanding Loans to which such payments relate, in each case
proportionately to Lenders' respective Pro Rata Shares. Administrative
Agent shall promptly distribute to each Lender, at its primary address
set forth below its name on the appropriate signature page hereof or at
such other address as such Lender may request, its Pro Rata Share of
all such payments received by Administrative Agent and the commitment
fees of such Lender when received by Administrative Agent pursuant to
subsection 2.3. Notwithstanding the foregoing provisions of this
subsection 2.4C(iii), if, pursuant to the provisions of subsection
2.6C, any Notice of Conversion/Continuation is withdrawn as to any
Affected Lender or if any Affected Lender makes Base Rate Loans in lieu
of its Pro Rata Share of any LIBO Rate Loans, Administrative Agent
shall give effect thereto in apportioning payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be
made hereunder shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the
computation of the payment of interest hereunder or of the commitment
fees hereunder, as the case may be.
(v) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of all Loans evidenced by that Note and all principal payments
previously made thereon and of the date to which interest thereon has
been paid; provided that the failure to make (or any error in the
making of) a notation of any Loan made under such Note shall not limit
or otherwise affect the obligations of Company hereunder or under such
Note with respect to any Loan or any payments of principal or interest
on such Note.
D. Application of Proceeds of Collateral and Payments Under Guaranties
(i) Application of Proceeds of Collateral. Except as provided
in subsection 2.4B(iii)(a) with respect to prepayments from Net Asset
Sale Proceeds, all proceeds received by Administrative Agent in respect
of any sale of, collection from, or other realization upon all or any
part of the Collateral under any Collateral Document may, in the
discretion of Administrative Agent, be held by Administrative Agent as
Collateral for, and/or (then or at any time thereafter) applied in full
or in part by Administrative Agent against, the applicable Secured
Obligations (as defined in such Collateral Document) in the following
order of priority:
(a) To the payment of all costs and expenses of such
sale, collection or other realization, including reasonable
compensation to Administrative Agent and its agents and counsel, and
all other expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, and all amounts for which
Administrative Agent is entitled to indemnification under such
Collateral Document and all advances made by Administrative Agent
thereunder for the account of the applicable Loan Party, and to the
payment of all costs and expenses paid or incurred by Administrative
Agent in connection with the exercise of any right or remedy under such
Collateral Document, all in accordance with the terms of this Agreement
and such Collateral Document;
(b) thereafter, to the extent of any excess such
proceeds, to the payment of all other such Secured Obligations for the
ratable benefit of the holders thereof;
(c) thereafter, to the extent of any excess such
proceeds, to the payment of cash collateral for Letters of Credit for
the ratable benefit of the Issuing Lenders thereof and holders of
participations therein; and (d) thereafter, to the extent of any excess
such proceeds, to the payment to or upon the order of such Loan Party
or to whosoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct.
(ii) Application of Payments Under Guaranties. All payments
received by Administrative Agent under any of the Guaranties shall be
applied promptly from time to time by Administrative Agent in the
following order of priority:
(a) to the payment of the costs and expenses of any
collection or other realization under the Guaranties, including
reasonable compensation to Administrative Agent and its agents and
counsel, and all expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, all in accordance with
the terms of this Agreement and such Guaranty;
(b) thereafter, to the extent of any excess such
payments, to the payment of all other Guarantied Obligations (as
defined in such Guaranty) for the ratable benefit of the holders
thereof; (c) thereafter, to the extent of any excess such payments, to
the payment of cash collateral for Letters of Credit for the ratable
benefit of the Issuing Lenders thereof and holders of participations
therein; and (d) thereafter, to the extent of any excess such payments,
to the payment to the applicable Subsidiary Guarantor or to whosoever
may be lawfully entitled to receive the same or as a court of competent
jurisdiction may direct.
2.5 Use of Proceeds
A. Term Loans. On the Closing Date, after application of not less than
$7.5 million in cash on hand of the Company and the cash proceeds, if any, of
$100 million of the Senior Subordinated Debt Securities as described in
subsection 4.1D, then the proceeds of the Tranche A Term Loans shall be applied
by Company to pay any remaining Acquisition Financing Requirements on the
Closing Date. On the Merger Date, the proceeds of any Tranche A Term Loans not
made on the Closing Date shall be applied by Company to pay the Acquisition
Financing Requirements not otherwise paid on the Closing Date.
B. Revolving Loans; Swing Line Loans. The proceeds of the Revolving
Loans and any Swing Line Loans shall be applied by Company for working capital
and general corporate purposes, which may include the making of interest
payments on the Loans, Permitted Acquisitions and the making of intercompany
loans to any of Company's Subsidiaries in accordance with subsection 7.1(iv) for
their own working capital purposes, and Letters of Credit may be issued for the
purposes set forth in the definition of such term.
C. Margin Regulations. No portion of the proceeds of any borrowing
under this Agreement shall be used by Company or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation U, Regulation T or Regulation X of the Board of Governors of
the Federal Reserve System or any other regulation of such Board or to violate
the Exchange Act, in each case as in effect on the date or dates of such
borrowing and such use of proceeds.
2.6 Special Provisions Governing LIBO Rate Loans
Notwithstanding any other provision of this Agreement to the contrary,
the following provisions shall govern with respect to LIBO Rate Loans as to the
matters covered:
A. Determination of Applicable Interest Rate. As soon as practicable
after 10:00 A.M. (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the LIBO Rate Loans for which an interest rate is then being
determined for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to Company and each
Lender.
B. Inability to Determine Applicable Interest Rate. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBO Rate Loans, that by reason of
circumstances affecting the London interbank market adequate and fair means do
not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBO Rate, Administrative Agent
shall on such date give notice (by telefacsimile or by telephone confirmed in
writing) to Company and each Lender of such determination, whereupon (i) no
Loans may be made as, or converted to, LIBO Rate Loans until such time as
Administrative Agent notifies Company and Lenders that the circumstances giving
rise to such notice no longer exist and (ii) any Notice of Borrowing or Notice
of Conversion/Continuation given by Company with respect to the Loans in respect
of which such determination was made shall be deemed to be rescinded by Company.
C. Illegality or Impracticability of LIBO Rate Loans. In the event that
on any date any Lender shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto but shall be made only after
consultation with Company and Administrative Agent) that the making, maintaining
or continuation of its LIBO Rate Loans (i) has become unlawful as a result of
compliance by such Lender in good faith with any law, treaty, governmental rule,
regulation, guideline or order (or would conflict with any such treaty,
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful) or (ii) has
become impracticable, or would cause such Lender material hardship, as a result
of contingencies occurring after the date of this Agreement which materially and
adversely affect the London interbank market or the position of such Lender in
that market, then, and in any such event, such Lender shall be an "Affected
Lender" and it shall on that day give notice (by telefacsimile or by telephone
confirmed in writing) to Company and Administrative Agent of such determination
(which notice Administrative Agent shall promptly transmit to each other
Lender). Thereafter (a) the obligation of the Affected Lender to make Loans as,
or to convert Loans to, LIBO Rate Loans shall be suspended until such notice
shall be withdrawn by the Affected Lender, (b) to the extent such determination
by the Affected Lender relates to a LIBO Rate Loan then being requested by
Company pursuant to a Notice of Borrowing or a Notice of Conversion/
Continuation, the Affected Lender shall make such Loan as (or convert such Loan
to, as the case may be) a Base Rate Loan, (c) the Affected Lender's obligation
to maintain its outstanding LIBO Rate Loans (the "Affected Loans") shall be
terminated at the earlier to occur of the expiration of the Interest Period then
in effect with respect to the Affected Loans or when required by law, and (d)
the Affected Loans shall automatically convert into Base Rate Loans on the date
of such termination. Notwithstanding the foregoing, to the extent a
determination by an Affected Lender as described above relates to a LIBO Rate
Loan then being requested by Company pursuant to a Notice of Borrowing or a
Notice of Conversion/Continuation, Company shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which the Affected Lender gives notice of its determination as
described above (which notice of rescission Administrative Agent shall promptly
transmit to each other Lender). Except as provided in the immediately preceding
sentence, nothing in this subsection 2.6C shall affect the obligation of any
Lender other than an Affected Lender to make or maintain Loans as, or to convert
Loans to, LIBO Rate Loans in accordance with the terms of this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest Periods.
Company shall compensate each Lender, upon written request by that Lender (which
request shall set forth in reasonable detail the basis for requesting such
amounts), for all reasonable losses, expenses and liabilities (including any
interest paid by that Lender to lenders of funds borrowed by it to make or carry
its LIBO Rate Loans and any loss, expense or liability sustained by that Lender
in connection with the liquidation or re-employment of such funds) which that
Lender may sustain: (i) if for any reason (other than a default by that Lender)
a borrowing of any LIBO Rate Loan does not occur on a date specified therefor in
a Notice of Borrowing or a telephonic request for borrowing, or a conversion to
or continuation of any LIBO Rate Loan does not occur on a date specified
therefor in a Notice of Conversion/Continuation or a telephonic request for
conversion or continuation, (ii) if any prepayment (including any prepayment
pursuant to subsection 2.4B(i)) or other principal payment or any conversion of
any of its LIBO Rate Loans occurs on a date prior to the last day of an Interest
Period applicable to that Loan, (iii) if any prepayment of any of its LIBO Rate
Loans is not made on any date specified in a notice of prepayment given by
Company, or (iv) as a consequence of any other default by Company in the
repayment of its LIBO Rate Loans when required by the terms of this Agreement.
E. Booking of LIBO Rate Loans. Any Lender may make, carry or transfer
LIBO Rate Loans at, to, or for the account of any of its branch offices or the
office of an Affiliate of that Lender.
F. Assumptions Concerning Funding of LIBO Rate Loans. Calculation of
all amounts payable to a Lender under this subsection 2.6 and under subsection
2.7A shall be made as though that Lender had actually funded each of its
relevant LIBO Rate Loans through the purchase of a LIBO deposit bearing interest
at the rate obtained pursuant to clause (i) of the definition of Adjusted LIBO
Rate in an amount equal to the amount of such LIBO Rate Loan and having a
maturity comparable to the relevant Interest Period and through the transfer of
such LIBO deposit from an offshore office of that Lender to a domestic office of
that Lender in the United States of America; provided, however, that each Lender
may fund each of its LIBO Rate Loans in any manner it sees fit and the foregoing
assumptions shall be utilized only for the purposes of calculating amounts
payable under this subsection 2.6 and under subsection 2.7A.
G. LIBO Rate Loans After Default. After the occurrence of and during
the continuation of a Potential Event of Default or an Event of Default, (i)
Company may not elect to have a Loan be made or maintained as, or converted to,
a LIBO Rate Loan after the expiration of any Interest Period then in effect for
that Loan and (ii) subject to the provisions of subsection 2.6D, any Notice of
Borrowing or Notice of Conversion/Continuation given by Company with respect to
a requested borrowing or conversion/continuation that has not yet occurred shall
be deemed to be rescinded by Company.
2.7 Increased Costs; Taxes; Capital Adequacy
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that the adoption, effectiveness, phase-in or
applicability after the date hereof of any law, treaty or governmental rule,
regulation or order, or any change therein or in the interpretation,
administration or application thereof, or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to
any additional Tax (other than any Tax on the overall net income of
such Lender) with respect to this Agreement or any of its obligations
hereunder or any payments to such Lender (or its applicable lending
office) of principal, interest, fees or any other amount payable
hereunder;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Lender (other than any such reserve or other requirements with respect
to LIBO Rate Loans that are reflected in the definition of Adjusted
LIBO Rate); or
(iii) imposes any other condition (other than with respect to
a Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the London interbank market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto in an amount deemed by such Lender (in its sole discretion) to
be material; then, in any such case, Company shall promptly pay to such Lender,
upon receipt of the statement referred to in the next sentence, such additional
amount or amounts (in the form of an increased rate of, or a different method of
calculating, interest or otherwise as such Lender in its sole discretion shall
determine) as may be necessary to compensate such Lender for any such increased
cost or reduction in amounts received or receivable hereunder. Such Lender shall
deliver to Company (with a copy to Administrative Agent) a written statement,
setting forth in reasonable detail the basis for calculating the additional
amounts owed to such Lender under this subsection 2.7A, which statement shall be
conclusive and binding upon all parties hereto absent manifest error.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by Company
under this Agreement and the other Loan Documents shall (except to the
extent required by law) be paid free and clear of, and without any
deduction or withholding on account of, any Tax (other than a Tax on
the overall net income of any Lender) imposed, levied, collected,
withheld or assessed by or within the United States of America or any
political subdivision in or of the United States of America or any
other jurisdiction from or to which a payment is made by or on behalf
of Company or by any federation or organization of which the United
States of America or any such jurisdiction is a member at the time of
payment.
(ii) Grossing-up of Payments. If Company or any other Person
is required by law to make any deduction or withholding on account of
any such Tax from any sum paid or payable by Company to Administrative
Agent or any Lender under any of the Loan Documents:
(a) Company shall notify Administrative Agent of any
such requirement or any change in any such requirement as soon as
Company becomes aware of it;
(b) Company shall pay any such Tax before the date on
which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on Company) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as the
case may be) on behalf of and in the name of Administrative Agent or
such Lender;
(c) the sum payable by Company in respect of which
the relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making of
that deduction, withholding or payment, Administrative Agent or such
Lender, as the case may be, receives on the due date a net sum equal to
what it would have received had no such deduction, withholding or
payment been required or made; and
(d) within 30 days after paying any sum from which it
is required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required by
clause (b) above to pay, Company shall deliver to Administrative Agent
evidence satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the relevant
taxing or other authority;
provided that no such additional amount shall be required to be paid to any
Lender under clause (c) above except to the extent that any change after the
date hereof (in the case of each Lender listed on the signature pages hereof) or
after the date of the Assignment Agreement pursuant to which such Lender became
a Lender (in the case of each other Lender) in any such requirement for a
deduction, withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment from that in
effect at the date of this Agreement or at the date of such Assignment
Agreement, as the case may be, in respect of payments to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "Non-US Lender") shall deliver to Administrative Agent for
transmission to Company, on or prior to the Closing Date (in the case
of each Lender listed on the signature pages hereof) or on or prior to
the date of the Assignment Agreement pursuant to which it becomes a
Lender (in the case of each other Lender), and at such other times as
may be necessary in the determination of Company or Administrative
Agent (each in the reasonable exercise of its discretion), (1) two
original copies of Internal Revenue Service Form 1001 or 4224 (or any
successor forms), properly completed and duly executed by such Lender,
together with any other certificate or statement of exemption required
under the Internal Revenue Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or withholding
of United States federal income tax with respect to any payments to
such Lender of principal, interest, fees or other amounts payable under
any of the Loan Documents or (2) if such Lender is not a "bank" or
other Person described in Section 881(c)(3) of the Internal Revenue
Code and cannot deliver either Internal Revenue Service Form 1001 or
4224 pursuant to clause (1) above, a Certificate re Non-Bank Status
together with two original copies of Internal Revenue Service Form W-8
(or any successor form), properly completed and duly executed by such
Lender, together with any other certificate or statement of exemption
required under the Internal Revenue Code or the regulations issued
thereunder to establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to any
payments to such Lender of interest payable under any of the Loan
Documents.
(b) Each Lender required to deliver any forms,
certificates or other evidence with respect to United States federal
income tax withholding matters pursuant to subsection 2.7B(iii)(a)
hereby agrees, from time to time after the initial delivery by such
Lender of such forms, certificates or other evidence, whenever a lapse
in time or change in circumstances renders such forms, certificates or
other evidence obsolete or inaccurate in any material respect, that
such Lender shall promptly (1) deliver to Administrative Agent for
transmission to Company two new original copies of Internal Revenue
Service Form 1001 or 4224, or a Certificate re Non-Bank Status and two
original copies of Internal Revenue Service Form W-8, as the case may
be, properly completed and duly executed by such Lender, together with
any other certificate or statement of exemption required in order to
confirm or establish that such Lender is not subject to deduction or
withholding of United States federal income tax with respect to
payments to such Lender under the Loan Documents or (2) notify
Administrative Agent and Company of its inability to deliver any such
forms, certificates or other evidence.
(c) Company shall not be required to pay any additional
amount to any Non-US Lender under clause (c) of subsection 2.7B(ii) if
such Lender shall have failed to satisfy the requirements of clause (a)
or (b)(1) of this subsection 2.7B(iii); provided that if such Lender
shall have satisfied the requirements of subsection 2.7B(iii)(a) on the
Closing Date (in the case of each Lender listed on the signature pages
hereof) or on the date of the Assignment Agreement pursuant to which it
became a Lender (in the case of each other Lender), nothing in this
subsection 2.7B(iii)(c) shall relieve Company of its obligation to pay
any additional amounts pursuant to clause (c) of subsection 2.7B(ii) in
the event that, as a result of any change in any applicable law, treaty
or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is
no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender is
not subject to withholding as described in subsection 2.7B(iii)(a).
C. Capital Adequacy Adjustment. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such governmental authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Company from
such Lender of the statement referred to in the next sentence, Company shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such controlling corporation on an after-tax basis for such reduction. Such
Lender shall deliver to Company (with a copy to Administrative Agent) a written
statement, setting forth in reasonable detail the basis of the calculation of
such additional amounts, which statement shall be conclusive and binding upon
all parties hereto absent manifest error.
2.8 Obligation of Lenders and Issuing Lenders to Mitigate; Replacement of
Lender
A. Mitigation. Each Lender and Issuing Lender agrees that, as promptly
as practicable after the officer of such Lender or Issuing Lender responsible
for administering the Loans or Letters of Credit of such Lender or Issuing
Lender, as the case may be, becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to become an Affected
Lender or that would entitle such Lender or Issuing Lender to receive payments
under subsection 2.7 or subsection 3.6, it will, to the extent not inconsistent
with the internal policies of such Lender or Issuing Lender and any applicable
legal or regulatory restrictions, use reasonable efforts (i) to make, issue,
fund or maintain the Commitments of such Lender or the affected Loans or Letters
of Credit of such Lender or Issuing Lender through another lending or letter of
credit office of such Lender or Issuing Lender, or (ii) take such other measures
as such Lender or Issuing Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6
would be materially reduced and if, as determined by such Lender or Issuing
Lender in its sole discretion, the making, issuing, funding or maintaining of
such Commitments or Loans or Letters of Credit through such other lending or
letter of credit office or in accordance with such other measures, as the case
may be, would not otherwise materially adversely affect such Commitments or
Loans or Letters of Credit or the interests of such Lender or Issuing Lender;
provided that such Lender or Issuing Lender will not be obligated to utilize
such other lending or letter of credit office pursuant to this subsection 2.8
unless Company agrees to pay all incremental expenses incurred by such Lender or
Issuing Lender as a result of utilizing such other lending or letter of credit
office as described in clause (i) above. A certificate as to the amount of any
such expenses payable by Company pursuant to this subsection 2.8 (setting forth
in reasonable detail the basis for requesting such amount) submitted by such
Lender or Issuing Lender to Company (with a copy to Administrative Agent) shall
be conclusive absent manifest error.
B. Replacement of Lender. If Company receives a notice pursuant to
subsection 2.7A, 2.7B, 2.7C or 3.6, a Lender defaults in its obligations
hereunder or in the event a Lender has not consented to a proposed change,
waiver, discharge or termination with respect to this Agreement which requires
the consent of all Lenders and which has been approved by Requisite Lenders, as
provided in subsection 10.6B, Company shall have the right, if no Potential
Event of Default or Event of Default then exists, to replace such Lender (a
"Replaced Lender") with one or more Eligible Assignees (collectively, the
"Replacement Lender") acceptable to Administrative Agent; provided that (i) at
the time of any replacement pursuant to this subsection 2.8, the Replacement
Lender shall enter into one or more Assignment Agreements pursuant to subsection
10.1B (and with all fees payable pursuant to such subsection 10.1B to be paid by
the Replacement Lender) pursuant to which the Replacement Lender shall acquire
all of the outstanding Loans and Commitments of, and in each case participations
in Letters of Credit and Swing Line Loans by, the Replaced Lender and, in
connection therewith, shall pay to (x) the Replaced Lender in respect thereof an
amount equal to the sum of (A) an amount equal to the principal of, and all
accrued interest on, all outstanding Loans of the Replaced Lender, (B) an amount
equal to all unpaid drawings with respect to Letters of Credit that have been
funded by (and not reimbursed to) such Replaced Lender, together with all then
unpaid interest with respect thereto at such time and (C) an amount equal to all
accrued, but theretofore unpaid, fees owing to the Replaced Lender with respect
thereto, (y) the appropriate Issuing Lender an amount equal to such Replaced
Lender's Pro Rata Share of any unpaid drawings with respect to Letters of Credit
(which at such time remains an unpaid drawing) issued by it to the extent such
amount was not theretofore funded by such Replaced Lender, and (z) Swing Line
Lender an amount equal to such Replaced Lender's Pro Rata Share of any Refunded
Swing Line Loans to the extent such amount was not theretofore funded by such
Replaced Lender, and (ii) all obligations (including without limitation all such
amounts, if any, owing under subsection 2.6D) of Company owing to the Replaced
Lender (other than those specifically described in clause (i) above in respect
of which the assignment purchase price has been, or is concurrently being,
paid), shall be paid in full to such Replaced Lender concurrently with such
replacement. Upon the execution of the respective Assignment Agreements,
recordation of such assignment in the Register by Administrative Agent pursuant
to subsection 2.1D, the payment of amounts referred to in clauses (i) and (ii)
above and delivery to the Replacement Lender of the appropriate Note or Notes
executed by Company, the Replacement Lender shall become a Lender hereunder and
the Replaced Lender shall cease to constitute a Lender hereunder except with
respect to indemnification provisions under this Agreement which by the terms of
this Agreement survive the termination of this Agreement, which indemnification
provisions shall survive as to such Replaced Lender. Notwithstanding anything to
the contrary contained above, no Issuing Lender may be replaced hereunder at any
time while it has Letters of Credit outstanding hereunder unless arrangements
satisfactory to such Issuing Lender (including the furnishing of a Standby
Letter of Credit in form and substance, and issued by an issuer, satisfactory to
such Issuing Lender or the furnishing of cash collateral in amounts and pursuant
to arrangements satisfactory to such Issuing Lender) have been made with respect
to such outstanding Letters of Credit.
Section 3. LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein
A. Letters of Credit. In addition to Company requesting that Revolving
Lenders make Revolving Loans pursuant to subsection 2.1A(ii) and that Swing Line
Lender make Swing Line Loans pursuant to subsection 2.1A(iii), Company may
request, in accordance with the provisions of this subsection 3.1, from time to
time during the period from the Closing Date to but excluding the date which is
thirty (30) days prior to Revolving Loan Commitment Termination Date, that one
or more Revolving Lenders issue Letters of Credit payable on a sight basis for
the account of Company for the purposes specified in the definitions of
Commercial Letters of Credit and Standby Letters of Credit. Subject to the terms
and conditions of this Agreement and in reliance upon the representations and
warranties of Company herein set forth, any one or more Revolving Lenders may,
but (except as provided in subsection 3.1B(ii)) shall not be obligated to, issue
such Letters of Credit in accordance with the provisions of this subsection 3.1;
provided that Company shall not request that any Revolving Lender issue (and no
Revolving Lender shall issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Revolving Loan Commitments would
exceed the Revolving Loan Commitments then in effect;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $5 million;
(iii) any Standby Letter of Credit having an expiration date
later than the earlier of (a) the date which is ten (10) Business Days
prior to the Revolving Loan Commitment Termination Date and (b) the
date that is one year from the date of issuance of such Standby Letter
of Credit; provided that the immediately preceding clause (b) shall not
prevent any Issuing Lender from agreeing that a Standby Letter of
Credit will automatically be extended for one or more successive
periods not to exceed one year each unless such Issuing Lender elects
not to extend for any such additional period; and provided further that
such Issuing Lender shall elect not to extend such Standby Letter of
Credit if it has knowledge that an Event of Default has occurred and is
continuing (and has not been waived in accordance with subsection 10.6)
at the time such Issuing Lender must elect whether or not to allow such
extension;
(iv) any Commercial Letter of Credit having an expiration date
(a) later than the earlier of (X) the date which is thirty (30) days
prior to the Revolving Loan Commitment Termination Date and (Y) the
date which is 180 days from the date of issuance of such Commercial
Letter of Credit or (b) that is otherwise unacceptable to the
applicable Issuing Lender in its reasonable discretion;
(v) any Letter of Credit at a tenor other than at sight; or
(vi) any Letter of Credit denominated in a currency other than Dollars
if, after giving effect to such issuance, the Dollar Equivalent of the
Letter of Credit Usage for all Letters of Credit denominated in a
currency other than Dollars would exceed $2 million.
B. Mechanics of Issuance.
(i) Request for Issuance. Whenever Company desires the
issuance of a Letter of Credit, it shall deliver to Administrative
Agent a Request for Issuance of Letter of Credit in the form of Exhibit
III annexed hereto no later than 12:00 Noon (New York City time) at
least five Business Days, or such shorter period as may be agreed to by
the Issuing Lender in any particular instance, in advance of the
proposed date of issuance. The Request for Issuance of Letter of Credit
shall specify (a) the proposed date of issuance (which shall be a
Business Day), (b) whether the Letter of Credit is to be a Standby
Letter of Credit or a Commercial Letter of Credit, (c) the face amount
of the Letter of Credit, (d) in the case of a Letter of Credit which
Company requests to be denominated in a currency other than Dollars,
the currency in which Company requests such Letter of Credit to be
issued, (e) the expiration date of the Letter of Credit, (f) the name
and address of the beneficiary, and (g) either the verbatim text of the
proposed Letter of Credit or the proposed terms and conditions thereof,
including a precise description of any documents to be presented by the
beneficiary which, if presented by the beneficiary prior to the
expiration date of the Letter of Credit, would require the Issuing
Lender to make payment under the Letter of Credit; provided that the
Issuing Lender, in its reasonable discretion, may require changes in
the text of the proposed Letter of Credit or any such documents.
Company shall notify the applicable Issuing Lender (and
Administrative Agent, if Administrative Agent is not such Issuing
Lender) prior to the issuance of any Letter of Credit in the event that
any of the matters to which Company is required to certify in the
applicable Request for Issuance of Letter of Credit is no longer true
and correct as of the proposed date of issuance of such Letter of
Credit, and upon the issuance of any Letter of Credit Company shall be
deemed to have re-certified, as of the date of such issuance, as to the
matters to which Company is required to certify in the applicable
Request for Issuance of Letter of Credit.
(ii) Determination of Issuing Lender. Upon receipt by
Administrative Agent of a Request for Issuance of Letter of Credit
pursuant to subsection 3.1B(i) requesting the issuance of a Letter of
Credit, in the event Administrative Agent elects to issue such Letter
of Credit, Administrative Agent shall promptly so notify Company, and
Administrative Agent shall be the Issuing Lender with respect thereto.
In the event that Administrative Agent, in its sole discretion, elects
not to issue such Letter of Credit, Administrative Agent shall promptly
so notify Company, whereupon Administrative Agent shall request any
other Revolving Lender to issue such Letter of Credit by delivering to
such Revolving Lender a copy of the applicable Request for Issuance of
Letter of Credit. Any Revolving Lender so requested to issue such
Letter of Credit shall promptly notify Administrative Agent whether or
not, in its sole discretion, it has elected to issue such Letter of
Credit, and any such Lender which so elects to issue such Letter of
Credit shall be the Issuing Lender with respect thereto. In the event
that all other Revolving Lenders shall have declined to issue such
Letter of Credit, notwithstanding the prior election of Administrative
Agent not to issue such Letter of Credit, Administrative Agent shall be
obligated to issue such Letter of Credit and shall be the Issuing
Lender with respect thereto, notwithstanding the fact that the Letter
of Credit Usage with respect to such Letter of Credit and with respect
to all other Letters of Credit issued by Administrative Agent, when
aggregated with Administrative Agent's outstanding Revolving Loans and
Swing Line Loans, may exceed Administrative Agent's Revolving Loan
Commitment then in effect; provided that Administrative Agent shall not
be obligated to issue any Letter of Credit denominated in a foreign
currency which in the judgment of Administrative Agent is not readily
and freely available..
(iii) Issuance of Letter of Credit. Upon satisfaction or
waiver (in accordance with subsection 10.6) of the conditions set forth
in subsection 4.4, the Issuing Lender shall issue the requested Letter
of Credit in accordance with the Issuing Lender's standard operating
procedures.
(iv) Notification to Revolving Lenders. Upon the issuance of
or amendment to any Letter of Credit the applicable Issuing Lender
shall promptly notify Administrative Agent and each other Revolving
Lender of such issuance or amendment. The notice to Administrative
Agent shall be accompanied by a copy of such Letter of Credit or
amendment and in the event a Revolving Lender requests a copy of such
issuance or amendment, such copies will be provided by Administrative
Agent. Promptly after receipt of such notice (or, if Administrative
Agent is the Issuing Lender, together with such notice), Administrative
Agent shall notify each Revolving Lender of the amount of such Lender's
respective participation in such Letter of Credit, determined in
accordance with subsection 3.1C.
(v) Reports to Revolving Lenders. In the event that the
Issuing Lender is other than Administrative Agent, such Issuing Lender
will send by facsimile transmission to Administrative Agent, promptly
on the first Business Day of each month, the daily maximum amount
available to be drawn for the Letters of Credit for the previous month.
Administrative Agent shall deliver to each Revolving Lender, upon each
Letter of Credit fee payment, a report setting forth for such period
the daily maximum amount available to be drawn under the Letters of
Credit issued by all Issuing Lenders during such period.
(vi) Collateralization of Letters of Credit Due to Currency
Fluctuation. If on any Computation Date Administrative Agent shall have
determined that the Letter of Credit Usage exceeds the amount permitted
under subsection 3.1A(ii) by an amount greater than $50,000 because of
a change in applicable rates of exchange between Dollars and any
foreign currency, then Administrative Agent shall give notice to the
Company that cash collateralization of the Letter of Credit Usage
exceeding the amount permitted under subsection 3.1A(ii) is required
and Company shall cash collateralize its outstanding Letters of Credit
by depositing Dollars into the Collateral Account established under the
Collateral Account Agreement in an amount equal to the extent that the
Letter of Credit Usage exceeds the amount permitted under subsection
3.1A(ii).
C. Revolving Lenders' Purchase of Participations in Letters of Credit.
Immediately upon the issuance of each Letter of Credit, each Revolving Lender
shall be deemed to, and hereby agrees to, have irrevocably purchased from the
Issuing Lender a participation in such Letter of Credit and any drawings honored
thereunder in an amount equal to such Revolving Lender's Pro Rata Share of the
maximum amount which is or at any time may become available to be drawn
thereunder. Upon satisfaction of the conditions set forth in subsection 4.1, the
Existing Letters of Credit shall, effective as of the Closing Date, become
Letters of Credit under this Agreement to the same extent as if initially issued
hereunder and each Revolving Loan Lender shall be deemed to have irrevocably
purchased from the Issuing Lender(s) of such Existing Letters of Credit a
participation in such Letters of Credit and drawings thereunder in an amount
equal to such Revolving Lender's Pro Rata Share of the maximum amount which is
or at any time may become available to be drawn thereunder. All such Existing
Letters of Credit which become Letters of Credit under this Agreement shall be
fully secured by the Collateral commencing on the Closing Date to the same
extent as if initially issued hereunder on such date.
3.2 Letter of Credit Fees
Company agrees to pay the following amounts with respect to Letters of
Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting fee,
payable directly to the applicable Issuing Lender for its own account,
equal to the greater of (x) $500 and (y) 0.25% per annum the Dollar
Equivalent of the daily amount available to be drawn under such Letter
of Credit and (b) a letter of credit fee, payable to Administrative
Agent for the account of Revolving Lenders (based upon their respective
Pro Rata Shares), equal to (x) the Applicable LIBO Rate Margin
multiplied by (y) the Dollar Equivalent of the daily maximum amount
available from time to time to be drawn under such Letter of Credit,
each such fronting fee or letter of credit fee to be payable in arrears
on and to (but excluding) the last Business Day of each March, June,
September and December of each year and computed on the basis of a
360-day year for the actual number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of
each Letter of Credit and each payment of a drawing made thereunder
(without duplication of the fees payable under clause (i) above),
documentary and processing charges payable directly to the applicable
Issuing Lender for its own account in accordance with such Issuing
Lender's standard schedule for such charges in effect at the time of
such issuance, amendment, transfer or payment, as the case may be.
For purposes of calculating any fees payable under clause (i) of this subsection
3.2, (1) the Dollar Equivalent of the daily amount available to be drawn under
any Letter of Credit shall be determined as of the close of business on any date
of determination and (2) the Dollar Equivalent of any amount described in such
clause which is denominated in a currency other than Dollars shall be determined
by the applicable Exchange Rate for such currency as of the immediately
preceding monthly anniversary of the date of issuance of such Letter of Credit.
Promptly upon receipt by Administrative Agent of any amount described in clause
(i)(b) of this subsection 3.2, Administrative Agent shall distribute to each
Revolving Lender its Pro Rata Share of such amount. With respect to Existing
Letters of Credit, the fees described in clauses (i) and (ii) above shall accrue
from and including the Closing Date.
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit
A. Responsibility of Issuing Lender With Respect to Drawings. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, the Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in substantial accordance with
the terms and conditions of such Letter of Credit.
B. Reimbursement by Company of Amounts Paid Under Letters of Credit. In
the event an Issuing Lender has determined to honor a drawing under a Letter of
Credit issued by it, such Issuing Lender shall immediately notify Company and
Administrative Agent, and Company shall reimburse such Issuing Lender on or
before the Business Day immediately following the date on which such drawing is
honored (the "Reimbursement Date") in an amount in Dollars (which amount, in the
case of a drawing under a Letter of Credit which is denominated in a currency
other than Dollars, shall be calculated by reference to the applicable Exchange
Rate) and in same day funds equal to the amount of such drawing; provided that,
anything contained in this Agreement to the contrary notwithstanding, (i) unless
Company shall have notified Administrative Agent and such Issuing Lender prior
to 10:00 A.M. (New York City time) on the date such drawing is honored that
Company intends to reimburse such Issuing Lender for the amount of such drawing
with funds other than the proceeds of Revolving Loans, Company shall be deemed
to have given a timely Notice of Borrowing to Administrative Agent requesting
Lenders to make Revolving Loans that are Base Rate Loans on the Reimbursement
Date in an amount in Dollars (which amount, in the case of a drawing under a
Letter of Credit which is denominated in a currency other than Dollars, shall be
calculated by reference to the applicable Exchange Rate) equal to the amount of
such drawing and (ii) subject to satisfaction or waiver of the conditions
specified in subsection 4.3B, Revolving Lenders shall, on the Reimbursement
Date, make Revolving Loans that are Base Rate Loans in the amount of such
drawing, the proceeds of which shall be applied directly by Administrative Agent
to reimburse such Issuing Lender for the amount of such drawing; and provided
further that if for any reason proceeds of Revolving Loans are not received by
such Issuing Lender on the Reimbursement Date in an amount equal to the amount
of such drawing, Company shall reimburse such Issuing Lender, on demand, in an
amount in same day funds equal to the excess of the amount of such drawing over
the aggregate amount of such Revolving Loans, if any, which are so received.
Nothing in this subsection 3.3B shall be deemed to relieve any Revolving Lender
from its obligation to make Revolving Loans on the terms and conditions set
forth in this Agreement, and Company shall retain any and all rights it may have
against any Revolving Lender resulting from the failure of such Lender to make
such Revolving Loans under this subsection 3.3B.
C. Payment by Revolving Lenders of Unreimbursed Amounts Paid Under
Letters of Credit.
(i) Payment by Revolving Lenders. In the event that Company
shall fail for any reason to reimburse any Issuing Lender as provided
in subsection 3.3B in an amount (calculated, in the case of a drawing
under a Letter of Credit denominated in a currency other than Dollars,
by reference to the applicable Exchange Rate) equal to the amount of
any drawing honored by such Issuing Lender under a Letter of Credit
issued by it, such Issuing Lender shall promptly notify each other
Revolving Lender of the unreimbursed amount of such drawing and of such
other Revolving Lender's respective participation therein based on such
Revolving Lender's Pro Rata Share. Each Revolving Lender shall make
available to such Issuing Lender an amount equal to its respective
participation, in Dollars and in same day funds, at the office of such
Issuing Lender specified in such notice, not later than 12:00 Noon (New
York City time) on the first business day (under the laws of the
jurisdiction in which such office of such Issuing Lender is located)
after the date notified by such Issuing Lender. In the event that any
Revolving Lender fails to make available to such Issuing Lender on such
business day the amount of such Revolving Lender's participation in
such Letter of Credit as provided in this subsection 3.3C, such Issuing
Lender shall be entitled to recover such amount on demand from such
Revolving Lender together with interest thereon at the Federal Funds
Effective Rate for three Business Days and thereafter at the Base Rate.
Nothing in this subsection 3.3C shall be deemed to prejudice the right
of any Revolving Lender to recover from any Issuing Lender any amounts
made available by such Revolving Lender to such Issuing Lender pursuant
to this subsection 3.3C in the event that it is determined by the final
judgment of a court of competent jurisdiction that the payment with
respect to a Letter of Credit by such Issuing Lender in respect of
which payment was made by such Revolving Lender constituted gross
negligence or willful misconduct on the part of such Issuing Lender.
(ii) Distribution to Revolving Lenders of Reimbursements
Received From Company. In the event any Issuing Lender shall have been
reimbursed by other Revolving Lenders pursuant to subsection 3.3C(i)
for all or any portion of any drawing honored by such Issuing Lender
under a Letter of Credit issued by it, such Issuing Lender shall
distribute to each other Revolving Lender which has paid all amounts
payable by it under subsection 3.3C(i) with respect to such honored
drawing such other Revolving Lender's Pro Rata Share of all payments
subsequently received by such Issuing Lender from Company in
reimbursement of such honored drawing when such payments are received.
Any such distribution shall be made to a Revolving Lender at its
primary address set forth below its name on the appropriate signature
page hereof or at such other address as such Revolving Lender may
request.
D. Interest on Amounts Paid Under Letters of Credit.
(i) Payment of Interest by Company. Company agrees to pay to
each Issuing Lender, with respect to drawings honored under any Letters
of Credit issued by it, interest on the amount paid by such Issuing
Lender in respect of each such drawing from the date such drawing is
honored to but excluding the date such amount is reimbursed by Company
(including any such reimbursement out of the proceeds of Revolving
Loans pursuant to subsection 3.3B) at a rate equal to (a) for the
period from the date of such drawing to but excluding the Reimbursement
Date, the rate then in effect under this Agreement with respect to
Revolving Loans that are Base Rate Loans and (b) thereafter, a rate
which is 2.00% per annum in excess of the rate of interest otherwise
payable under this Agreement with respect to Revolving Loans that are
Base Rate Loans. Interest payable pursuant to this subsection 3.3D(i)
shall be computed on the basis of a 360-day year for the actual number
of days elapsed in the period during which it accrues and shall be
payable on demand or, if no demand is made, on the date on which the
related drawing under a Letter of Credit is reimbursed in full.
(ii) Distribution of Interest Payments by Issuing Lender.
Promptly upon receipt by any Issuing Lender of any payment of interest
pursuant to subsection 3.3D(i) with respect to a drawing under a Letter
of Credit issued by it, (a) such Issuing Lender shall distribute to
each other Revolving Lender, out of the interest received by such
Issuing Lender in respect of the period from the date of such drawing
to but excluding the date on which such Issuing Lender is reimbursed
for the amount of such drawing (including any such reimbursement out of
the proceeds of Revolving Loans pursuant to subsection 3.3B), the
amount that such other Revolving Lender would have been entitled to
receive in respect of the letter of credit fee that would have been
payable in respect of such Letter of Credit for such period pursuant to
subsection 3.2 if no drawing had been honored under such Letter of
Credit, and (b) in the event such Issuing Lender shall have been
reimbursed by other Revolving Lenders pursuant to subsection 3.3C(i)
for all or any portion of such drawing, such Issuing Lender shall
distribute to each other Revolving Lender which has paid all amounts
payable by it under subsection 3.3C(i) with respect to such drawing
such other Revolving Lender's Pro Rata Share of any interest received
by such Issuing Lender in respect of that portion of such drawing so
reimbursed by other Revolving Lenders for the period from the date on
which such Issuing Lender was so reimbursed by other Revolving Lenders
to but excluding the date on which such portion of such drawing is
reimbursed by Company. Any such distribution shall be made to a
Revolving Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Revolving Lender may request.
3.4 Obligations Absolute
The obligation of Company to reimburse each Issuing Lender for drawings
made under the Letters of Credit issued by it and to repay any Revolving Loans
made by Revolving Lenders pursuant to subsection 3.3B and the obligations of
Revolving Lenders under subsection 3.3C(i) shall be unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit;
(ii) the existence of any claim, set-off, defense or other
right which Company or any Revolving Lender may have at any time
against a beneficiary or any transferee of any Letter of Credit (or any
Persons for whom any such transferee may be acting), any Issuing Lender
or other Lender or any other Person or, in the case of a Lender,
against Company, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction
(including any underlying transaction between Company or one of its
Subsidiaries and the beneficiary for which any Letter of Credit was
procured);
(iii) any draft or other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) payment by the applicable Issuing Lender under any Letter
of Credit against presentation of a draft or other document which does
not substantially comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document
by any party thereto;
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event
of Default shall have occurred and be continuing;
provided, in each case, that payment by the applicable Issuing
Lender under the applicable Letter of Credit shall not have constituted gross
negligence or willful misconduct of such Issuing Lender under the circumstances
in question (as determined by a final judgment of a court of competent
jurisdiction).
3.5 Indemnification; Nature of Issuing Lenders' Duties
A. Indemnification. In addition to amounts payable as provided in
subsection 3.6, Company hereby agrees to protect, indemnify, pay and save
harmless each Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which such Issuing Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by such Issuing
Lender, other than as a result of (a) the gross negligence or willful misconduct
of such Issuing Lender as determined by a final judgment of a court of competent
jurisdiction or (b) subject to the following clause (ii), the wrongful dishonor
by such Issuing Lender of a proper demand for payment made under any Letter of
Credit issued by it or (ii) the failure of such Issuing Lender to honor a
drawing under any such 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
"Governmental Acts").
B. Nature of Issuing Lenders' Duties. As between Company and any
Issuing Lender, Company assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by such Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Lender shall not be responsible (absent a
determination of a court of competent jurisdiction of gross negligence or
willful misconduct by such Issuing Lender) for: (i) 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 such Letter
of Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any such Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) failure of the beneficiary of any such Letter of Credit to
comply fully with any conditions required in order to draw upon such Letter of
Credit; (iv) 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; (v) errors in interpretation of technical terms; (vi)
any loss or delay in the transmission or otherwise of any document required in
order to make a drawing under any such Letter of Credit or of the proceeds
thereof; (vii) the misapplication by the beneficiary of any such Letter of
Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any
consequences arising from causes beyond the control of such Issuing Lender,
including any Governmental Acts, and none of the above shall affect or impair,
or prevent the vesting of, any of such Issuing Lender's rights or powers
hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by any Issuing Lender under or in connection with the Letters
of Credit issued by it or any documents and certificates delivered thereunder,
if taken or omitted in good faith, shall not put such Issuing Lender under any
resulting liability to Company.
Notwithstanding anything to the contrary contained in this subsection
3.5, Company shall retain any and all rights it may have against any Issuing
Lender for any liability arising solely out of the gross negligence or willful
misconduct of such Issuing Lender, as determined by a final judgment of a court
of competent jurisdiction.
3.6 Increased Costs and Taxes Relating to Letters of Credit
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that any
Issuing Lender or Revolving Lender shall determine (which determination shall,
absent manifest error, be final and conclusive and binding upon all parties
hereto) that any law, treaty or governmental rule, regulation or order, or any
change therein or in the interpretation, administration or application thereof
(including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by any
Issuing Lender or Revolving Lender with any guideline, request or directive
issued or made after the date hereof by any central bank or other governmental
or quasi-governmental authority (whether or not having the force of law):
(i) subjects such Issuing Lender or Revolving Lender (or its
applicable lending or letter of credit office) to any additional Tax
(other than any Tax on the overall net income of such Issuing Lender or
Revolving Lender) with respect to the issuing or maintaining of any
Letters of Credit or the purchasing or maintaining of any
participations therein or any other obligations under this Section 3,
whether directly or by such being imposed on or suffered by any
particular Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve
(including any marginal, emergency, supplemental, special or other
reserve), special deposit, compulsory loan, FDIC insurance or similar
requirement in respect of any Letters of Credit issued by any Issuing
Lender or participations therein purchased by any Revolving Lender; or
(iii) imposes any other condition (other than with respect to
a Tax matter) on or affecting such Issuing Lender or Revolving Lender
(or its applicable lending or letter of credit office) regarding this
Section 3 or any Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Revolving Lender of agreeing to issue, issuing or maintaining any
Letter of Credit or agreeing to purchase, purchasing or maintaining any
participation therein or to reduce any amount received or receivable by such
Issuing Lender or Revolving Lender (or its applicable lending or letter of
credit office) with respect thereto (in any amount deemed by such Issuing Lender
(in its sole discretion) to be material); then, in any case, Company shall
promptly pay to such Issuing Lender or Revolving Lender, upon receipt of the
statement referred to in the next sentence, such additional amount or amounts as
may be necessary to compensate such Issuing Lender or Revolving Lender for any
such increased cost or reduction in amounts received or receivable hereunder.
Such Issuing Lender or Revolving Lender shall deliver to Company a written
statement, setting forth in reasonable detail the basis for calculating the
additional amounts owed to such Issuing Lender or Revolving Lender under this
subsection 3.6, which statement shall be conclusive and binding upon all parties
hereto absent manifest error.
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters of
Credit hereunder are subject to, and the Existing Letters of Credit shall become
Letters of Credit under this Agreement upon, the satisfaction of the following
conditions:
4.1 Conditions to Initial Loans
The obligations of Lenders to make the initial Loans to be made on the
Closing Date are, in addition to the conditions precedent specified in
subsection 4.3, subject to prior or concurrent satisfaction of the following
conditions:
A. Loan Party Documents. On or before the Closing Date, Company shall,
and shall cause each other Loan Party to, deliver to Lenders (or to
Administrative Agent for Lenders with sufficient originally executed copies,
where appropriate, for each Lender and its counsel) the following with respect
to Company or such Loan Party, as the case may be, each, unless otherwise noted,
dated the Closing Date:
(i) Certified copies of the Certificate or Articles of
Incorporation of such Person, together with a good standing certificate
from the Secretary of State of its jurisdiction of incorporation and
each other state in which such Person is qualified as a foreign
corporation to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing
authority of each of such jurisdictions, each dated a recent date prior
to the Closing Date;
(ii) Copies of the Bylaws of such Person, certified as of the
Closing Date by such Person's corporate secretary or an assistant
secretary;
(iii) Resolutions of the Board of Directors of such Person
approving and authorizing the execution, delivery and performance of
the Loan Documents and the Related Agreements to which it is a party,
and the consummation of the transactions contemplated by the foregoing,
certified as of the Closing Date by the corporate secretary or an
assistant secretary of such Person as being in full force and effect
without modification or amendment;
(iv) Signature and incumbency certificates of the officers of
such Person executing the Loan Documents to which it is a party;
(v) Executed originals of the Loan Documents, in each case to
which such Person is a party; and (vi) Such other documents as
Administrative Agent may reasonably request.
B. No Material Adverse Change. Since October 31, 1998, Company and each
of its Subsidiaries and, since December 31, 1998, Shelby and each of its
Subsidiaries, shall have conducted its business in the ordinary course of
business and consistent with past practice and there shall not have been any
Material Adverse Effect.
C. Corporate Structure, Ownership, Management, Etc. The corporate
organizational structure of Company and its Subsidiaries, both before and after
consummation of the Tender Offer and the Merger, shall be as set forth on
Schedule 5.1 annexed hereto. The senior management of Company, Shelby and their
respective Subsidiaries shall be satisfactory to Administrative Agent in all
material respects.
D. Senior Subordinated Debt Securities; Use of Proceeds
(i) On or before the Closing Date (1) the Senior Subordinated
Debt Indenture, the Senior Subordinated Debt Securities and any
guaranties relating thereto shall be satisfactory to Administrative
Agent and shall be in full force and effect and shall not have been
amended, supplemented, waived or otherwise modified without the consent
of Administrative Agent, and executed or conformed copies thereof
(including all exhibits and schedules thereto) and any amendments
thereto and all documents executed in connection therewith shall have
been delivered to Administrative Agent, and (2) Company shall have
received the gross cash proceeds from the issuance of an aggregate
principal amount of $100 million in Senior Subordinated Debt
Securities.
(ii) On or before the Closing Date, (1) Company shall have
contributed the net cash proceeds from the Senior Subordinated Debt
Securities issuance to Acquisition Co., and Company and Acquisition Co.
shall have applied such proceeds to the Acquisition Financing
Requirements; and (2) Company shall have applied at least $7.5 million
in cash on hand to the Acquisition Financing Requirements.
E. Necessary Governmental Authorizations and Consents; Expiration of
Waiting Periods, Etc. Company, Acquisition Co. and Shelby shall have obtained
all Governmental Authorizations and all consents of other Persons, in each case
that are necessary or advisable in connection with the Tender Offer, the Merger,
the related financings and the other transactions contemplated by the Loan
Documents and the Related Agreements and the continued operation of the business
conducted by Company and its Subsidiaries and Shelby and its Subsidiaries in
substantially the same manner as conducted prior to the consummation of the
Tender Offer, the Merger, the related financings and the other transactions
contemplated by the Loan Documents and the Related Agreements, and each of the
foregoing shall be in full force and effect, in each case other than those the
failure to obtain or maintain which, either individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect. All
applicable waiting periods relating to competition or antitrust laws and
regulations shall have expired without any action being taken or threatened by
any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the Tender Offer, the Merger, the related financings and
the transactions contemplated by the Loan Documents and the Related Agreements.
No action, request for stay, petition for review or rehearing, reconsideration,
or appeal with respect to any of the foregoing shall be pending, and the time
for any applicable agency to take action to set aside its consent on its own
motion shall have expired.
F. Tender Offer Matters.
(i) Tender Offer Materials. The Tender Offer Materials shall
be satisfactory to Administrative Agent and shall not have been
amended, supplemented, waived or otherwise modified in any respect
determined by Administrative Agent to be material (including, without
limitation, any increase in the price to be paid for the Shelby Common
Stock to an amount in excess of $16.50 per share) without the consent
of Administrative Agent.
(ii) Merger Agreement and certain other Related Agreements.
Administrative Agent shall have received fully executed or conformed
copies of the Merger Agreement and any documents executed in connection
therewith, and the Merger Agreement shall be in full force and effect
and no provision thereof shall have been amended, supplemented, waived
or otherwise modified in any respect determined by Administrative Agent
to be material (including, without limitation, any increase in the
price to be paid for the Shelby Common Stock to an amount in excess of
$16.50 per share), in each case without the consent of Administrative
Agent.
(iii) Consummation of Tender Offer; Minimum Shares.
Contemporaneously with the application of the proceeds of the Senior
Subordinated Debt Securities and the Company's cash on hand described
in subsection 4.1D and the initial Loans to be made on the Closing
Date, the Tender Offer shall have been consummated in all respects in
accordance with the Tender Offer Materials and no term or condition of
the Tender Offer shall have been amended, supplemented, waived or
otherwise modified in any respect determined by Administrative Agent to
be material without the consent of Administrative Agent. The cash
consideration paid to the holders of the shares of Shelby Common Stock
shall not exceed the Tender Offer Price. Not less than the Minimum
Shares shall have been tendered and accepted for payment in the Tender
Offer, the depository shall have delivered a report as to the number of
shares of Shelby Common Stock being held by it that have been validly
tendered and not withdrawn as of the Closing Date, and Company shall
have delivered an Officers' Certificate to the total number of shares
of Shelby Common Stock outstanding on a fully diluted basis as of the
Closing Date.
(iv) Use of Proceeds. Company shall have provided evidence
satisfactory to Administrative Agent that the proceeds of the Senior
Subordinated Debt Securities and the Company's cash on hand described
in subsection 4.1D have been irrevocably committed, prior to the
application of the proceeds of the Tranche A Term Loans made on the
Closing Date, to the payment of a portion of the Acquisition Financing
Requirements. Acquisition Co. shall have deposited with the depository
not less than the aggregate purchase price for the Shelby Common Stock
to be purchased by Acquisition Co. in the Tender Offer in immediately
available funds contemporaneously with the application of the initial
Loans to be made on the Closing Date.
(v) Officers' Certificates. Administrative Agent shall have an
Officers' Certificate from Company to the effect that the
representations and warranties of each of Acquisition Co. and Shelby in
the Merger Agreement are true, correct and complete in all material
respects on and as of the Closing Date to the same extent as though
made on and as of that date. Administrative Agent shall have received
Officers' Certificates from Company to the effect that (a) the Merger
Agreement is in full force and effect and no provision thereof has been
amended, supplemented, waived or otherwise modified in any material
respect without the consent of Administrative Agent and (b) each of the
parties to the Merger Agreement has complied with all agreements, terms
and conditions contained in the Merger Agreement and any agreements or
documents referred to therein required to be performed or complied with
by each of them on or before the Closing Date, except where such
failure to comply or perform could not reasonably be expected to have a
Material Adverse Effect, and none of such Persons are in default in
their performance or compliance with any of the terms or provisions
thereof, except where such default could not reasonably be expected to
have a Material Adverse Effect.
(vi) Existing Company Indebtedness; Release of Liens. As of
the Closing Date, the Existing Company Indebtedness shall not exceed
approximately $20 million plus accrued interest and fees thereon.
Contemporaneously with the application of the proceeds of the initial
Loans to be made on the Closing Date:
(a) Company shall have repaid in full its Indebtedness
under the Credit Agreement dated April 22, 1998 between Company and
NationsBank, N.A., and shall have terminated any commitments to lend or
make other extensions of credit thereunder and no other Existing
Company Indebtedness shall remain outstanding other than the
Indebtedness permitted under Section 7.1(v);
(b) Company shall have delivered to Administrative Agent
all documents and instruments and taken all other actions, in each case
necessary to release all Liens securing the Existing Company
Indebtedness in connection therewith;
(c) Company shall have made arrangements satisfactory to
Administrative Agent with respect to the cancellation of any letters of
credit (other than the Existing Letters of Credit) outstanding
thereunder or the issuance of Letters of Credit to support the
obligations of Company and its Subsidiaries with respect thereto;
(d) Administrative Agent shall have received an Officers'
Certificate of Company stating that, after giving effect to the
transactions described in this subsection 4.1F(vi), there shall be no
existing Indebtedness of Company or its Subsidiaries outstanding after
consummation of the Closing Date transactions other than the
Indebtedness permitted under subsection 7.1, such Indebtedness to be in
form and substance satisfactory to Administrative Agent.
(vii) Existing Shelby Indebtedness. As of the Closing Date,
the Existing Shelby Indebtedness shall not exceed approximately $3.0
million plus accrued interest and fees thereon. Contemporaneously with
the application of the proceeds of the initial Loans to be made on the
Closing Date:
(a) Shelby and its Subsidiaries shall have repaid in full
the Existing Shelby Indebtedness;
(b) Shelby and its Subsidiaries shall have terminated any
commitments to lend or make other extensions of credit thereunder;
(c) Shelby shall have delivered to Administrative Agent
all documents and instruments and taken all other actions, in each case
necessary to release all Liens securing the Existing Shelby
Indebtedness in connection therewith;
(d) Shelby shall have made arrangements satisfactory to
Administrative Agent with respect to the cancellation of any letters of
credit (other than the Existing Letters of Credit) outstanding
thereunder or the issuance of Letters of Credit to support the
obligations of Shelby and its Subsidiaries with respect thereto; (e)
Company shall cause Shelby and its Domestic Subsidiaries to deliver to
Lenders (or to Administrative Agent for Lenders with sufficient
originally executed copies, where appropriate, for each Lender and its
counsel) the following with respect such Person, each, unless otherwise
noted, dated the Closing Date:
(1) Certified copies of the Certificate or Articles
of Incorporation of such Person, together with a good standing
certificate from the Secretary of State of its jurisdiction of
incorporation and each other state in which such Person is qualified as
a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to
payment of any applicable franchise or similar taxes from the
appropriate taxing authority of each of such jurisdictions, each dated
a recent date prior to the Closing Date;
(2) Copies of the Bylaws of such Person, certified
as of the Closing Date by such Person's corporate secretary or an
assistant secretary;
(3) Resolutions of the Board of Directors of such
Person approving and authorizing the execution, delivery and
performance of the Loan Documents and the Related Agreements to which
it is a party, and the consummation of the transactions contemplated by
the foregoing, certified as of the Closing Date by the corporate
secretary or an assistant secretary of such Person as being in full
force and effect without modification or amendment; and
(4) Signature and incumbency certificates of the
officers of such Person executing the Loan Documents to which it is a
party.
(viii) Existing Letters of Credit. On the Closing Date, the
Existing Letters of Credit shall have become Letters of Credit under
this Agreement. Company shall have furnished to Administrative Agent
copies of all Existing Letters of Credit and all amendments thereto.
Company shall have paid to the issuing lenders with respect to such
Existing Letters of Credit all fees and other amounts owing with
respect thereto through and including the Closing Date.
G. Mortgages; Mortgage Policies; Etc. Administrative Agent shall have
received from Company and each applicable Subsidiary of Company:
(i) Mortgages. Fully executed and notarized Mortgages and any
assignments thereof in favor of Administrative Agent, on behalf of
Lenders (each a "Closing Date Mortgage" and, collectively, the "Closing
Date Mortgages"), in proper form for recording in all appropriate
places in all applicable jurisdictions, encumbering each Real Property
Asset listed in Schedule 5.5 annexed hereto and identified as a Closing
Date mortgaged property (each a "Closing Date Mortgaged Property" and,
collectively, the "Closing Date Mortgaged Properties");
(ii) Matters Relating to Flood Hazard Properties. (a)
Evidence, which may be in the form of a letter from an insurance broker
or a municipal engineer, as to whether (1) any Closing Date Mortgaged
Property is a Flood Hazard Property and (2) the community in which any
such Flood Hazard Property is located is participating in the National
Flood Insurance Program, (b) if there are any such Flood Hazard
Properties, such Person's written acknowledgement of receipt of written
notification from Administrative Agent (1) as to the existence of each
such Flood Hazard Property and (2) as to whether the community in which
each such Flood Hazard Property is located is participating in the
National Flood Insurance Program, and (c) in the event any such Flood
Hazard Property is located in a community that participates in the
National Flood Insurance Program, evidence that Company or the
applicable Subsidiary of Company has obtained flood insurance in
respect of such Flood Hazard Property to the extent required under the
applicable regulations of the Board of Governors of the Federal Reserve
System;
(iii) Opinions of Local Counsel. If required by Administrative
Agent, an opinion of counsel (which counsel shall be reasonably
satisfactory to Administrative Agent) in each state in which a Closing
Date Mortgaged Property is located with respect to the enforceability
of the form(s) of Closing Date Mortgages to be recorded in such state
and such other matters as Administrative Agent may reasonably request,
in each case in form and substance reasonably satisfactory to
Administrative Agent;
(iv) Landlord Consents and Estoppels; Recorded Leasehold
Interests. In the case of each Closing Date Mortgaged Property
consisting of a Leasehold Property, (a) a Landlord Consent and Estoppel
with respect thereto and (b) evidence that such Leasehold Property is a
Recorded Leasehold Interest;
(v) Title Insurance. (a) ALTA mortgagee title insurance
policies or unconditional commitments therefor (the "Closing Date
Mortgage Policies") issued by the Title Company with respect to the
Closing Date Mortgaged Properties listed on Schedule 5.5 annexed
hereto, in amounts not less than the respective amounts designated
therein with respect to any particular Closing Date Mortgaged
Properties, insuring fee simple title to, or a valid leasehold interest
in, each such Closing Date Mortgaged Property vested in such Loan Party
and assuring Administrative Agent that the applicable Closing Date
Mortgages create valid and enforceable First Priority mortgage Liens on
the respective Closing Date Mortgaged Properties encumbered thereby
(provided that Company may cause to be delivered to Administrative
Agent on the Closing Date a Closing Date Mortgage Policy listing as an
exception any of the items set forth on Schedule 5.5 so long as such
exception is removed by endorsement within 15 days of the Closing
Date), which Closing Date Mortgage Policies (1) shall include an
endorsement for mechanics' liens, for future advances under this
Agreement and for any other matters reasonably requested by
Administrative Agent and (2) shall provide for affirmative insurance
and such reinsurance as Administrative Agent may reasonably request,
all of the foregoing in form and substance reasonably satisfactory to
Administrative Agent; and (b) evidence satisfactory to Administrative
Agent that such Loan Party has (i) delivered to the Title Company all
certificates and affidavits required by the Title Company in connection
with the issuance of the Closing Date Mortgage Policies and (ii) paid
to the Title Company or to the appropriate governmental authorities all
expenses and premiums of the Title Company in connection with the
issuance of the Closing Date Mortgage Policies and all recording and
stamp taxes (including mortgage recording and intangible taxes) payable
in connection with recording the Closing Date Mortgages in the
appropriate real estate records;
(vi) Surveys. Unless otherwise approved by Administrative
Agent for delivery pursuant to subsection 6.9D, ALTA Surveys of each
Closing Date Mortgaged Property satisfactory in form and substance to
the Administrative Agent and the Title Company reasonably current and
certified to Administrative Agent and Title Company by a licensed
surveyor. Notwithstanding anything to the contrary herein, if
Administrative Agent, in its sole discretion, determines not to record
a Mortgage against one or more Mortgaged Properties on the Closing Date
or Merger Date, as the case may be, because the survey for such
Mortgaged Property has not been delivered to Administrative Agent,
Company shall not be in default hereunder for failure to satisfy the
requirements of this subsection with respect to such Mortgaged
Property; provided, however, that Company or the applicable Subsidiary
Guarantor shall satisfy such requirements no later than forty-five (45)
days after the Closing Date or Merger Date, as the case may be.
(vii) Copies of Documents Relating to Title Exceptions. Copies
of all recorded documents listed as exceptions to title or otherwise
referred to in the Closing Date Mortgage Policies; and
(viii) Environmental Indemnity. If requested by Administrative
Agent, an environmental indemnity agreement, reasonably satisfactory in
form and substance to Administrative Agent and its counsel, with
respect to the indemnification of Agents and Lenders for any
liabilities that may be imposed on or incurred by any of them as a
result of any Hazardous Materials Activity.
H. Security Interests in Personal and Mixed Property. To the extent not
otherwise satisfied pursuant to subsection 4.1G, Administrative Agent shall have
received evidence satisfactory to it that Company and Subsidiary Guarantors
(other than Acquisition Co. and Shelby and its Subsidiaries in the event that
less than 90% of the Shelby Common Stock is tendered in the Tender Offer) shall
have taken or caused to be taken all such actions, executed and delivered or
caused to be executed and delivered all such agreements, documents and
instruments, and made or caused to be made all such filings and recordings
(other than the filing or recording of items described in clauses (iii) and (iv)
below) that may be necessary or, in the opinion of Administrative Agent,
desirable in order to create in favor of Administrative Agent, for the benefit
of Lenders, a valid and (upon such filing and recording) perfected First
Priority security interest in the entire personal and mixed property Collateral.
Such actions shall include the following:
(i) Schedules to Collateral Documents. Delivery to
Administrative Agent of accurate and complete schedules to all of the
applicable Collateral Documents;
(ii) Stock Certificates and Instruments. Delivery to
Administrative Agent of (a) certificates (which certificates shall be
accompanied by irrevocable undated stock powers, duly endorsed in blank
and otherwise satisfactory in form and substance to Administrative
Agent) representing all capital stock pledged pursuant to the Pledge
Agreement executed by Company and the Subsidiary Pledge Agreements
executed by the applicable existing Domestic Subsidiaries of Company
and (b) all promissory notes or other instruments (duly endorsed, where
appropriate, in a manner satisfactory to Administrative Agent)
evidencing any Collateral;
(iii) Lien Searches and UCC Termination Statements. Delivery
to Administrative Agent of (a) the results of a recent search, by a
Person satisfactory to Administrative Agent, of all effective UCC
financing statements and fixture filings which may have been made with
respect to any personal or mixed property of any Loan Party, together
with copies of all such filings disclosed by such search, and (b) UCC
termination statements duly executed by all applicable Persons for
filing in all applicable jurisdictions as may be necessary to terminate
any effective UCC financing statements or fixture filings disclosed in
such search (other than any such financing statements or fixture
filings in respect of Liens permitted to remain outstanding pursuant to
the terms of this Agreement);
(iv) UCC Financing Statements and Fixture Filings. Delivery to
Administrative Agent of UCC financing statements and, where
appropriate, fixture filings, duly executed by each applicable Loan
Party with respect to all personal and mixed property Collateral of
such Loan Party, for filing in all jurisdictions as may be necessary
or, in the opinion of Administrative Agent, desirable to perfect the
security interests created in such Collateral pursuant to the
Collateral Documents;
(v) PTO Cover Sheets, Etc. Delivery to Administrative Agent of
all cover sheets or other documents or instruments required to be filed
with the PTO in order to create or perfect Liens in respect of any IP
Collateral; and
(vi) Opinions of Local Counsel. To the extent required by
Administrative Agent, delivery to Administrative Agent of an opinion of
counsel (which counsel shall be reasonably satisfactory to
Administrative Agent) under the laws of each jurisdiction in which any
Loan Party or any personal or mixed property Collateral is located with
respect to the creation and perfection of the security interests in
favor of Administrative Agent in such Collateral and such other matters
governed by the laws of such jurisdiction regarding such security
interests as Administrative Agent may reasonably request, in each case
in form and substance reasonably satisfactory to Administrative Agent.
I. Environmental Reports. Administrative Agent shall have received
reports and other information, in form, scope and substance satisfactory to
Administrative Agent, regarding environmental matters relating to Company, its
Subsidiaries, Shelby and its Subsidiaries and the Facilities, which reports
shall include (i) a Phase I, and, if necessary, a Phase II, environmental
assessment for each of the Facilities located within the United States currently
owned, leased, operated or used by Company, Shelby or any of their Subsidiaries
(collectively, the "Phase I and II Reports") which (a) conforms to the ASTM
Standard Practice for Environmental Site Assessments: Phase I Environmental Site
Assessment Process, E 1527, and the equivalent with respect to Phase II
assessments, (b) was conducted no more than six months prior to the Closing Date
by one or more environmental consulting firms reasonably satisfactory to
Administrative Agent, and (c) includes an estimate of the reasonable worst-case
cost of investigating and remediating any Hazardous Materials Activity
identified in the Phase I and II Reports as giving rise to an actual or
potential material violation of any Environmental Law or as presenting a
material risk of giving rise to a material Environmental Claim, and (ii) a
current compliance audit setting forth an assessment of Company's and Shelby's,
their Subsidiaries' and such Facilities' current and past compliance with
Environmental Laws and an estimate of the cost of rectifying any non-compliance
with current Environmental Laws identified therein and the cost of compliance
with reasonably anticipated future Environmental Laws identified therein.
J. Financial Statements; Pro Forma Balance Sheet. Lenders shall have
received (i) audited financial statements of Company and its Subsidiaries for
the Fiscal Years ended October 31, 1998, November 1, 1997 and November 2, 1996,
consisting of balance sheets and the related consolidated statements of income,
stockholders' equity and cash flows for such Fiscal Years, (ii) unaudited
financial statements of Company and its Subsidiaries for the Fiscal Quarters
ending on or about January 31 and, if available, April 30, 1999, consisting of a
balance sheet and the related consolidated statements of income, stockholders'
equity and cash flows for the three- and six-month periods ending on such dates,
all in reasonable detail and certified by the chief financial officer of Company
that they fairly present the financial condition of Company and its Subsidiaries
as at the dates indicated and the results of their operations and their cash
flows for the periods indicated, subject to changes from audit and normal
year-end adjustments, (iii) pro forma consolidated balance sheets of Company and
its Subsidiaries and of Shelby and its Subsidiaries as at the Merger Date,
prepared in accordance with GAAP and reflecting the consummation of the Tender
Offer, the related financings and the other transactions contemplated by the
Loan Documents and the Related Agreements, which pro forma financial statements
shall be in form and substance satisfactory to Agents and Lenders, and (iv)
projected financial statements (including balance sheets and related statements
of operations, stockholders' equity and cash flows) of, Company and its
Subsidiaries through and including the last day of Company's Fiscal Year ended
on or about October 31, 2005, which projected financial statements shall be in
form and substance satisfactory to Agents and Lenders.
K. Solvency Assurances. On the Closing Date, Administrative Agent and
Lenders shall have received a Financial Condition Certificate, with appropriate
attachments, in each case demonstrating that, after giving effect to the Tender
Offer, the related financings and the other transactions contemplated by the
Loan Documents and the Related Agreements, Company and its Subsidiaries will be
Solvent.
L. Evidence of Insurance. Administrative Agent shall have received a
certificate from Company's insurance broker or other evidence satisfactory to it
that all insurance required to be maintained pursuant to subsection 6.4 is in
full force and effect and that Administrative Agent on behalf of Lenders has
been named as additional insured and/or loss payee thereunder to the extent
required under subsection 6.4.
M. Opinions of Counsel to Loan Parties; Reliance Letters. Lenders and
their respective counsel shall have received originally executed copies of one
or more favorable written opinions of Gallop, Xxxxxxx & Xxxxxx, X.X., counsel
for Loan Parties, in form and substance reasonably satisfactory to
Administrative Agent and its counsel, dated as of the Closing Date and setting
forth substantially the matters in the opinions designated in Exhibit VII
annexed hereto and as to such other matters as Administrative Agent acting on
behalf of Lenders may reasonably request. Administrative Agent and its counsel
shall have received copies of each of the opinions of counsel delivered to the
parties under the Related Agreements on or prior to the Closing Date, together
with a letter from each such counsel authorizing Lenders to rely upon such
opinion to the same extent as though it were addressed to Lenders.
N. Opinions of Administrative Agent's Counsel. Lenders shall have
received originally executed copies of one or more favorable written opinions of
O'Melveny & Xxxxx LLP, counsel to Administrative Agent, dated as of the Closing
Date, substantially in the form of Exhibit IX annexed hereto and as to such
other matters as Administrative Agent acting on behalf of Lenders may reasonably
request.
O. Fees. Company shall have paid to Arranger, Agents and Lenders the
fees payable on the Closing Date.
P. Representations and Warranties; Performance of Agreements. Company
shall have delivered to Administrative Agent an Officers' Certificate, in form
and substance satisfactory to Administrative Agent, to the effect that the
representations and warranties in Section 5 hereof are true, correct and
complete in all material respects on and as of the Closing Date to the same
extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Company shall have performed
in all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before the
Closing Date except as otherwise disclosed to and agreed to in writing by
Administrative Agent and Requisite Lenders.
Q. Additional Information. There shall have been no information
relating to conditions or events not previously disclosed to Administrative
Agent or relating to new information or additional developments concerning
conditions of events previously disclosed to Administrative Agent which may have
a Material Adverse Effect on the business, operations, properties, assets,
liabilities, condition (financial or otherwise) or prospects of Company, Shelby
and their respective Subsidiaries. The results of Administrative Agent's legal,
tax, regulatory and environmental investigations with respect to Shelby and its
Subsidiaries, the Tender Offer, the Merger, the related financings and the other
transactions contemplated by the Loan Documents and the Related Agreements shall
be reasonably satisfactory in all material respects to Administrative Agent.
R. Completion of Proceedings. All corporate and other proceedings taken
or to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by Administrative
Agent, acting on behalf of Lenders, and its counsel shall be satisfactory in
form and substance to Administrative Agent and such counsel, and Administrative
Agent and such counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may reasonably
request.
Each Lender hereby agrees that by its execution and delivery of its
signature page hereto and by the funding of its Loans to be made on the Closing
Date, such Lender approves of and consents to each of the matters set forth in
this subsection 4.1 which must be approved by, or satisfactory to, Requisite
Lenders; provided that, in the case of any agreement or document which must be
approved by, or which must be satisfactory to, Requisite Lenders, a copy of such
agreement or document shall have been delivered to such Lender on or prior to
the Closing Date.
4.2 Conditions to Loans Made on Merger Date
The obligations of Lenders to make the Loans to be made on the Merger
Date are, in addition to the conditions precedent specified in subsection 4.3,
subject to the prior or concurrent satisfaction of the following conditions:
A. Shelby Documents. On or before the Merger Date, Company shall, or
shall cause Shelby and its Domestic Subsidiaries to, as the case may be, deliver
to Lenders (or to Administrative Agent for Lenders with sufficient originally
executed copies, where appropriate, for each Lender and its counsel) the
following, each, unless otherwise noted, dated the Merger Date:
(i) Certified copies of the Certificate or Articles of
Incorporation of each of Shelby and its Domestic Subsidiaries, together
with, where applicable, a good standing certificate from the Secretary
of State of its jurisdiction of incorporation and each other state in
which Shelby or any of its Domestic Subsidiaries is qualified as a
foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to
payment of any applicable franchise or similar taxes from the
appropriate taxing authority of each of such jurisdictions, each dated
a recent date prior to the Merger Date;
(ii) Copies of the Bylaws of each of Shelby and its Domestic
Subsidiaries, certified as of the Merger Date by such Person's
corporate secretary or an assistant secretary;
(iii) Resolutions of the Board of Directors of Shelby and its
Domestic Subsidiaries approving and authorizing the execution, delivery
and performance of the Loan Documents and the Related Agreements to
which it is a party and the consummation of the transactions
contemplated by the foregoing, each certified as of the Merger Date by
the corporate secretary or an assistant secretary of such Person as
being in full force and effect without modification or amendment;
(iv) Signature and incumbency certificates of the officers of
Shelby and its Subsidiaries executing the Loan Documents to which it is
a party;
(v) Originals of the Subsidiary Guaranty, the Subsidiary
Pledge Agreements, the Subsidiary Security Agreements and the
Mortgages, in each case executed by Shelby and each of its Domestic
Subsidiaries, as the case may be; and
(vi) Such other documents as Administrative Agent may
reasonably request;
provided, however, that to the extent the documents required to be delivered
pursuant to subsections 4.2A(i)-(iv) have been previously delivered pursuant to
subsections 4.1A(i)-(iv) or subsection 4.1F(vii)(e) on the Closing Date,
Company, Shelby or its Subsidiaries, as the case may be, may deliver a
certificate from the corporate secretary or assistant secretary of such Person
certifying that each such document has been previously delivered and has not
been amended, supplemented, waived or otherwise modified since the Closing Date
and each such document is in full force and effect.
B. Satisfaction of Conditions in Subsection 4.1. On or before the
Merger Date, all conditions precedent set forth in subsection 4.1 shall have
been satisfied or waived in writing by Requisite Lenders and (unless the Closing
Date is also the Merger Date as determined in accordance with subsection 6.10)
and Lenders shall have made the initial Loans on the Closing Date.
C. Related Agreements. To the extent not otherwise satisfied pursuant
to subsection 4.1F, Administrative Agent shall have received a fully executed or
conformed copy of each Related Agreement and any documents executed in
connection therewith, and each such Related Agreement shall be in full force and
effect and no provision thereof shall have been amended, supplemented, waived or
otherwise modified in any respect determined by Administrative to be material,
in each case without the consent of Administrative Agent.
D. Consummation of Merger.
(i) All conditions to the Merger set forth in the Merger
Agreement shall have been satisfied or the fulfillment of any such
conditions shall have been waived with the consent of Administrative
Agent and Requisite Lenders;
(ii) the Merger shall have become effective in accordance with
the terms of the Merger Agreement and the Delaware General Corporation
Law;
(iii) Administrative Agent shall have received satisfactory
evidence of the filing of the documents with the Secretary of State of
the State of Delaware effecting the Merger on the Merger Date;
(iv) the aggregate cash consideration for the shares of Shelby
Common Stock to be acquired in any manner whatsoever in connection with
the Tender Offer and the Merger shall not exceed approximately $148.3
million in the aggregate or the Tender Offer Price;
(v) Transaction Costs incurred as of the Merger Date
(including any such amounts incurred on or before the Closing Date)
shall not exceed $10.5 million and Administrative Agent shall have
received evidence to its satisfaction to such effect; and
(vi) Administrative Agent shall have received an Officers'
Certificate of Company to the effect set forth in clauses (i)-(v)
above.
E. Mortgages; Mortgage Policies; Etc. Administrative Agent shall have
received from Company and each applicable Subsidiary Guarantor:
(i) Mortgages. Fully executed and notarized Mortgages (each a
"Merger Date Mortgage" and, collectively, the "Merger Date Mortgages")
in proper form for recording in all appropriate places in all
applicable jurisdictions, encumbering each Real Property Asset listed
in Schedule 5.5 annexed hereto and identified as a Merger Date
mortgaged property (each a "Merger Date Mortgaged Property" and,
collectively, the "Merger Date Mortgaged Properties"); and
(ii) Matters Relating to Flood Hazard Properties. (a)
Evidence, which may be in the form of a letter from an insurance broker
or a municipal engineer, as to whether (1) any Merger Date Mortgaged
Property is a Flood Hazard Property and (2) the community in which any
such Flood Hazard Property is located is participating in the National
Flood Insurance Program, (b) if there are any such Flood Hazard
Properties, such Person's written acknowledgement of receipt of written
notification from Administrative Agent (1) as to the existence of each
such Flood Hazard Property and (2) as to whether the community in which
each such Flood Hazard Property is located is participating in the
National Flood Insurance Program, and (c) in the event any such Flood
Hazard Property is located in a community that participates in the
National Flood Insurance Program, evidence that Company or the
applicable Subsidiary of Company has obtained flood insurance in
respect of such Flood Hazard Property to the extent required under the
applicable regulations of the Board of Governors of the Federal Reserve
System;
(iii) Opinions of Local Counsel. To the extent required by
Administrative Agent, an opinion of counsel (which counsel shall be
reasonably satisfactory to Administrative Agent) in each state in which
a Merger Date Mortgaged Property is located with respect to the
enforceability of the form(s) of Merger Date Mortgages to be recorded
in such state and such other matters as Administrative Agent may
reasonably request, in each case in form and substance reasonably
satisfactory to Administrative Agent;
(iv) Landlord Consents and Estoppels; Recorded Leasehold
Interests. In the case of each Merger Date Mortgaged Property
consisting of a Leasehold Property, (a) a Landlord Consent and Estoppel
with respect thereto and (b) evidence that such Leasehold Property is a
Recorded Leasehold Interest;
(v) Title Insurance. (a) ALTA mortgagee title insurance
policies or unconditional commitments therefor (the "Merger Date
Mortgage Policies") issued by the Title Company with respect to the
Merger Date Mortgaged Properties listed on Schedule 5.5 annexed hereto,
in amounts not less than the respective amounts designated therein with
respect to any particular Merger Date Mortgaged Properties, insuring
fee simple title to, or a valid leasehold interest in, each such Merger
Date Mortgaged Property vested in such Loan Party and assuring
Administrative Agent that the applicable Merger Date Mortgages create
valid and enforceable First Priority mortgage Liens on the respective
Merger Date Mortgaged Properties encumbered thereby (provided that
Company may cause to be delivered to Administrative Agent on the Merger
Date a Merger Date Mortgage Policy listing as an exception any of the
items set forth on Schedule 5.5 so long as such exception is removed by
endorsement within 15 days of the Merger Date), which Merger Date
Mortgage Policies (1) shall include an endorsement for mechanics'
liens, for future advances under this Agreement and for any other
matters reasonably requested by Administrative Agent and (2) shall
provide for affirmative insurance and such reinsurance as
Administrative Agent may reasonably request, all of the foregoing in
form and substance reasonably satisfactory to Administrative Agent; and
(b) evidence satisfactory to Administrative Agent that such Loan Party
has (i) delivered to the Title Company all certificates and affidavits
required by the Title Company in connection with the issuance of the
Merger Date Mortgage Policies and (ii) paid to the Title Company or to
the appropriate governmental authorities all expenses and premiums of
the Title Company in connection with the issuance of the Merger Date
Mortgage Policies and all recording and stamp taxes (including mortgage
recording and intangible taxes) payable in connection with recording
the Merger Date Mortgages in the appropriate real estate records;
(vi) Surveys. Unless otherwise approved by Administrative
Agent for delivery pursuant to subsection 6.9D, ALTA Surveys of each
Merger Date Mortgaged Property satisfactory in form and substance to
the Administrative Agent and the Title Company reasonably current and
certified to Administrative Agent and Title Company by a licensed
surveyor. Notwithstanding anything to the contrary herein, if
Administrative Agent, in its sole discretion, determines not to record
a Mortgage against one or more Mortgaged Properties on the Closing Date
or Merger Date, as the case may be, because the survey for such
Mortgaged Property has not been delivered to Administrative Agent,
Company shall not be in default hereunder for failure to satisfy the
requirements of this subsection with respect to such Mortgaged
Property; provided, however, that Company or the applicable Subsidiary
Guarantor shall satisfy such requirements no later than forty-five (45)
days after the Closing Date or Merger Date, as the case may be.
(vii) Copies of Documents Relating to Title Exceptions. Copies
of all recorded documents listed as exceptions to title or otherwise
referred to in the Merger Date Mortgage Policies or in the title
reports delivered pursuant to subsection 4.2E(vi); and
(viii) Environmental Indemnity. If requested by Administrative
Agent, an environmental indemnity agreement, reasonably satisfactory in
form and substance to Administrative Agent and its counsel, with
respect to the indemnification of Agents and Lenders for any
liabilities that may be imposed on or incurred by any of them as a
result of any Hazardous Materials Activity.
F. Security Interests in Personal and Mixed Property. To the extent not
otherwise satisfied pursuant to subsection 4.1G, 4.1H or 4.2E, Administrative
Agent shall have received evidence satisfactory to it that Company and
Subsidiary Guarantors shall have taken or caused to be taken all such actions,
executed and delivered or caused to be executed and delivered all such
agreements, documents and instruments, and made or caused to be made all such
filings and recordings (other than the filing or recording of items described in
clauses (iii) and (iv) below) that may be necessary or, in the opinion of
Administrative Agent, desirable in order to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and (upon such filing and recording)
perfected First Priority security interest in the entire personal and mixed
property Collateral. Such actions shall include the following:
(i) Schedules to Collateral Documents. Delivery to
Administrative Agent of accurate and complete schedules to all of the
applicable Collateral Documents;
(ii) Stock Certificates and Instruments. Delivery to
Administrative Agent of (a) certificates (which certificates shall be
accompanied by irrevocable undated stock powers, duly endorsed in blank
and otherwise satisfactory in form and substance to Administrative
Agent) representing all capital stock pledged pursuant to the Pledge
Agreement executed by Company and the Subsidiary Pledge Agreements
executed by the Subsidiaries of Company and (b) all promissory notes or
other instruments (duly endorsed, where appropriate, in a manner
satisfactory to Administrative Agent) evidencing any Collateral;
(iii) UCC Financing Statements and Fixture Filings. Delivery
to Administrative Agent of UCC financing statements and, where
appropriate, fixture filings, duly executed by each applicable Loan
Party with respect to all personal and mixed property Collateral of
such Loan Party, for filing in all jurisdictions as may be necessary
or, in the opinion of Administrative Agent, desirable to perfect the
security interests created in such Collateral pursuant to the
Collateral Documents;
(iv) PTO Cover Sheets, Etc. Delivery to Administrative Agent
of all cover sheets or other documents or instruments required to be
filed with the PTO in order to create or perfect Liens in respect of
any IP Collateral; and
(v) Opinions of Local Counsel. If required by Administrative
Agent, delivery to Administrative Agent of an opinion of counsel (which
counsel shall be reasonably satisfactory to Administrative Agent) under
the laws of each jurisdiction in which any Loan Party or any personal
or mixed property Collateral is located with respect to the creation
and perfection of the security interests in favor of Administrative
Agent in such Collateral and such other matters governed by the laws of
such jurisdiction regarding such security interests as Administrative
Agent may reasonably request, in each case in form and substance
reasonably satisfactory to Administrative Agent.
G. Opinions of Counsel to Loan Parties; Reliance Letters. Lenders and
their respective counsel shall have received originally executed copies of one
or more favorable written opinions of Gallop, Xxxxxxx & Xxxxxx, X.X., counsel
for Loan Parties, in form and substance satisfactory to Administrative Agent s
and Lenders, dated as of the Merger Date and setting forth substantially the
matters in the opinions designated in Exhibit VIII annexed hereto and as to such
other matters as Administrative Agent acting on behalf of Lenders may reasonably
request and unless otherwise agreed by Administrative Agent. Administrative
Agent and its counsel shall have received copies of each of the opinions of
counsel delivered to the parties under the Related Agreements after the Closing
Date, together with a letter from each such counsel authorizing Lenders to rely
upon such opinion to the same extent as though it were addressed to Lenders.
H. Fees. Company shall have paid to Arrangers, Agents and Lenders the
fees payable on the Merger Date.
I. Representations and Warranties; Performance of Agreements. Company
shall have delivered to Administrative Agent an Officers' Certificate, in form
and substance satisfactory to Administrative Agent, to the effect that the
representations and warranties in Section 5 hereof are true, correct and
complete in all material respects on and as of the Merger Date to the same
extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Company shall have performed
in all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before the Merger
Date except as otherwise disclosed to and agreed to in writing by Administrative
Agent and Requisite Lenders.
4.3 Conditions to All Loans
The obligations of Lenders to make Loans on each Funding Date are
subject to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding Date,
in accordance with the provisions of subsection 2.1B, an originally executed
Notice of Borrowing, in each case signed by the chief executive officer, the
chief financial officer or the treasurer of Company or by any executive officer
of Company designated by any of the above-described officers on behalf of
Company in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein and in
the other Loan Documents shall be true, correct and complete in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date;
(ii) No event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such
Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before
that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender
from making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date
shall not violate any law including Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System;
and
(vi) There shall not be pending or, to the knowledge of
Company, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries that
has not been disclosed by Company in writing pursuant to subsection 5.6
or 6.1(ix) prior to the making of the last preceding Loans (or, in the
case of the initial Loans, prior to the execution of this Agreement),
and there shall have occurred no development not so disclosed in any
such action, suit, proceeding, governmental investigation or
arbitration so disclosed, that, in either event, in the opinion of
Administrative Agent or of Requisite Lenders, would be expected to have
a Material Adverse Effect; and no injunction or other restraining order
shall have been issued and no hearing to cause an injunction or other
restraining order to be issued shall be pending or noticed with respect
to any action, suit or proceeding seeking to enjoin or otherwise
prevent the consummation of, or to recover any damages or obtain relief
as a result of, the transactions contemplated by this Agreement or the
making of the Loans hereunder.
4.4 Conditions to Letters of Credit
The issuance of any Letter of Credit hereunder (whether or not the
applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
A. On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), an originally executed Request for Issuance of Letter of
Credit, in each case signed by the chief executive officer, the chief financial
officer or the treasurer of Company or by any executive officer of Company
designated by any of the above-described officers on behalf of Company in a
writing delivered to Administrative Agent, together with all other information
specified in subsection 3.1B(i) and such other documents or information as the
applicable Issuing Lender may reasonably require in connection with the issuance
of such Letter of Credit.
C. On the date of issuance of such Letter of Credit, all conditions
precedent described in subsection 4.3B shall be satisfied to the same extent as
if the issuance of such Letter of Credit were the making of a Loan and the date
of issuance of such Letter of Credit were a Funding Date.
Section 5. COMPANY'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders and the Agents to enter into this Agreement
and to make the Loans, to induce Issuing Lenders to issue Letters of Credit and
to induce other Lenders to purchase participations therein, Company represents
and warrants to each Lender and the Agents, on the date of this Agreement, on
each Funding Date and on the date of issuance of each Letter of Credit, that the
following statements are true, correct and complete:
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries
A. Organization and Powers. Each Loan Party is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization as specified in Schedule 5.1
annexed hereto. Each Loan Party has all requisite corporate power and authority
to own and operate its properties, to carry on its business as now conducted and
as proposed to be conducted, to enter into the Loan Documents and the Related
Agreements to which it is a party and to carry out the transactions contemplated
thereby.
B. Qualification and Good Standing. Each Loan Party is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions, individually or in the aggregate for all such jurisdictions,
where the failure to be so qualified or in good standing has not had and will
not have a Material Adverse Effect.
C. Conduct of Business. Company and its Subsidiaries are engaged only
in the businesses permitted to be engaged in pursuant to subsection 7.13.
D. Subsidiaries. All of the Subsidiaries of Company, including any
Inactive Subsidiaries, are identified in Schedule 5.1 annexed hereto, as said
Schedule 5.1 may be supplemented from time to time pursuant to the provisions of
subsection 6.1(xv). The capital stock of each of the Subsidiaries of Company
identified in Schedule 5.1 is duly authorized, validly issued, fully paid and
nonassessable and none of such capital stock (other than the Shelby Common
Stock) constitutes Margin Stock. Each of the Subsidiaries of Company identified
in Schedule 5.1 is a corporation duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of incorporation or
organization set forth therein, has all requisite corporate power and authority
to own and operate its properties and to carry on its business as now conducted
and as proposed to be conducted, and is qualified to do business and in good
standing in every jurisdiction where its assets are located and wherever
necessary to carry out its business and operations, in each case except where
failure to be so qualified or in good standing or a lack of such corporate power
and authority, individually or in the aggregate, has not had and will not have a
Material Adverse Effect. Schedule 5.1 correctly sets forth the ownership
interest of Company and each of its Subsidiaries in each of the Subsidiaries of
Company identified therein.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and performance
of the Loan Documents and the Related Agreements have been duly authorized by
all necessary actions on the part of each Loan Party that is a party thereto.
B. No Conflict. The execution, delivery and performance by Loan Parties
of the Loan Documents and the Related Agreements and the consummation of the
transactions contemplated by the Loan Documents and the Related Agreements do
not and will not (i) violate any provision of any law or any governmental rule
or regulation applicable to Company or any of its Subsidiaries, the Certificate
or the Articles of Incorporation or Bylaws of Company or any of Company's
Subsidiaries or any order, judgment or decree of any court or other agency of
government binding on Company or any of Company's Subsidiaries, (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any Contractual Obligation of Company or any of its
Subsidiaries, except for such breaches, conflicts and defaults which could not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, (iii) result in or require the creation or imposition of any
Lien upon any of the properties or assets of Company or any of Company's
Subsidiaries (other than any Liens created under any of the Loan Documents in
favor of Administrative Agent on behalf of Lenders), or (iv) require any
approval of or consent of any Person under any Contractual Obligation of Company
or any of Company's Subsidiaries, except for such approvals or consents which
will be obtained on or before the Closing Date and disclosed in writing to
Lenders or which the failure to obtain could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
C. Governmental Consents. The execution, delivery and performance by
Loan Parties of the Loan Documents and the Related Agreements and the
consummation of the transactions contemplated by the Loan Documents and the
Related Agreements do not and will not require any registration with, consent or
approval of, or notice to, or other action to, with or by, any federal, state or
other governmental authority or regulatory body, except for filings required in
connection with the perfection of security interests granted pursuant to the
Loan Documents, and such other registrations, consents, approvals, notices or
other actions which have been or will be made, obtained, given or taken on or
before the Closing Date or which the failure to obtain or take could not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
D. Binding Obligation. Each of the Loan Documents and the Related
Agreements has been duly executed and delivered by each Loan Party that is a
party thereto and is the legally valid and binding obligation of such Loan
Party, enforceable against such Loan Party in accordance with its respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
E. Valid Issuance of Equity Securities. The capital stock of
Acquisition Co. to be sold on or before the Closing Date, when issued and
delivered, will be duly and validly issued, fully paid and nonassessable. No
stockholder of Acquisition Co. has or will have any preemptive rights to
subscribe for any additional equity Securities of Acquisition Co. The issuance
of sale of such common equity Securities of Acquisition Co., upon such issuance
and sale, will either (a) have been registered or qualified under applicable
federal and state securities laws or (b) be exempt therefrom.
F. Senior Subordinated Debt Securities. Company has the corporate power
and authority to issue the Senior Subordinated Debt Securities. The Senior
Subordinated Debt Securities, when issued, will be the legally valid and binding
obligations of Company, enforceable against Company in accordance with their
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability. The subordination
provisions of the Senior Subordinated Debt Securities are enforceable against
the holders thereof in accordance with their terms and the Loans, Letters of
Credit and all other monetary Obligations hereunder are within the definitions
of "Senior Indebtedness" and "Designated Senior Indebtedness" included in such
provisions. The Senior Subordinated Debt Securities are either (a) registered or
qualified under applicable federal and state securities laws or (b) are exempt
therefrom.
5.3 Financial Condition
Company has heretofore delivered to Lenders, at Lenders' request, the
following financial statements and information: (i) the audited consolidated
balance sheets of Company and its Subsidiaries as at October 31, 1998, November
1, 1997 and November 2, 1996 and the audited consolidated balance sheets of
Shelby and its Subsidiaries as at December 31, 1998, 1997 and 1996, and the
related consolidated statements of income, stockholders' equity and cash flows
of Company, Shelby and their respective Subsidiaries for the Fiscal Years then
ended and (ii) the unaudited consolidated balance sheet of Company and its
Subsidiaries for the Fiscal Quarters ending on or about January 31, 1999 and of
Shelby and its Subsidiaries as of March 31, 1999, and the related unaudited
consolidated statements of income, stockholders' equity and cash flows of
Company, Shelby and their respective Subsidiaries for the three months then
ended. All such statements were prepared in conformity with GAAP and fairly
present, in all material respects, the financial position (on a consolidated
basis) of the entities described in such financial statements as at the
respective dates thereof and the results of operations and cash flows (on a
consolidated basis) of the entities described therein for each of the periods
then ended, subject, in the case of any such unaudited financial statements, to
changes resulting from normal year-end adjustments. Company does not (and will
not following the funding of the initial Loans) have any Contingent Obligation,
contingent liability or liability for taxes, long-term lease or unusual forward
or long-term commitment that is not reflected in the foregoing financial
statements or the notes thereto and which in any such case is material in
relation to the business, operations, properties, assets, condition (financial
or otherwise) or prospects of Company or any of its Subsidiaries, taken as a
whole.
5.4 No Material Adverse Change; No Restricted Junior Payments
Since October 31, 1998, no event or change has occurred that has caused
or evidences, either in any case or in the aggregate, a Material Adverse Effect,
and neither Company nor any of its Subsidiaries has directly or indirectly
declared, ordered, paid or made, or set apart any sum or property for, any
Restricted Junior Payment or agreed to do so except as permitted under
subsection 7.5.
5.5 Title to Properties; Liens; Real Property
A. Title to Properties; Liens. Company and its Subsidiaries have (i)
good, sufficient and legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold interests
in real or personal property), or (iii) good title to (in the case of all other
personal property), all of their respective properties and assets reflected in
the financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, in each case except
for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under subsection 7.7.
Except as permitted by this Agreement, all such properties and assets are free
and clear of Liens. With respect to those Liens set forth on Schedule 5.5, the
debts secured thereby have been paid in full and are no longer outstanding.
B. Real Property. As of the Closing Date, Schedule 5.5 annexed hereto
contains a true, accurate and complete list of (i) all real property owned by
Company or any Subsidiary and (ii) all leases, subleases or assignments of
leases (together with all amendments, modifications, supplements, renewals or
extensions of any thereof) affecting each Real Property Asset of any Loan Party,
regardless of whether such Loan Party is the landlord or tenant (whether
directly or as an assignee or successor in interest) under such lease, sublease
or assignment. Except as specified in Schedule 5.5, each agreement listed in
clause (ii) of the immediately preceding sentence is in full force and effect
and Company does not have knowledge of any default that has occurred and is
continuing thereunder, and each such agreement constitutes the legally valid and
binding obligation of each applicable Loan Party, enforceable against such Loan
Party in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles.
5.6 Litigation; Adverse Facts
Except as set forth in Schedule 5.6 annexed hereto, there are no
actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of Company or any of its Subsidiaries) at
law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign (including any Environmental Claims) that are pending or, to
the knowledge of Company, threatened against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries and that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect or could reasonably be expected to prevent or unduly
delay the Merger or the consummation of the Tender Offer. Neither Company nor
any of its Subsidiaries (i) is in violation of any applicable laws (including
Environmental Laws) that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect, or (ii) is subject to or in
default with respect to any final judgments, writs, injunctions, decrees, rules
or regulations of any court or any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect.
5.7 Payment of Taxes
Except to the extent permitted by subsection 6.3 and except as
described or referred to on Schedule 5.7 annexed hereto, all tax returns and
reports of Company and its Subsidiaries required to be filed by any of them have
been timely filed, and all taxes shown on such tax returns to be due and payable
and all assessments, fees and other governmental charges upon Company and its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises which are due and payable have been paid when due and payable.
Company knows of no proposed tax assessment against Company or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect and which is not being actively contested by Company or such Subsidiary
in good faith and by appropriate proceedings; provided that such reserves or
other appropriate provisions, if any, as shall be required in conformity with
GAAP shall have been made or provided therefor.
5.8 Performance of Agreements; Materially Adverse Agreements
A. Neither Company nor any of its Subsidiaries is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any of its Contractual Obligations, and no condition
exists that, with the giving of notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default or defaults, if any, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
B. Neither Company nor any of its Subsidiaries is a party to or is
otherwise subject to any agreements or instruments or any charter or other
internal restrictions which, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
5.9 Governmental Regulation
Neither Company nor any of its Subsidiaries is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or the Investment Company Act of 1940 or under any other
federal or state statute or regulation which may limit its ability to incur
Indebtedness or which may otherwise render all or any portion of the Obligations
unenforceable.
5.10 Securities Activities
A. Neither Company nor any of its Subsidiaries is engaged principally,
or as one of its important activities, in the business of extending credit for
the purpose of purchasing or carrying any Margin Stock.
B. Not more than 25% of the value of the assets (either of Company only
or of Company and its Subsidiaries on a consolidated basis) that are subject to
the restrictions on Liens or dispositions contained in subsection 7.2 or 7.7 or
subject to any restriction contained in any agreement or instrument, between
Company and any Lender or any Affiliate of any Lender, relating to Indebtedness
and within the scope of subsection 8.2, will be Margin Stock.
5.11 Employee Benefit Plans
A. Company and each of its Subsidiaries are in compliance with all
applicable provisions and requirements of ERISA and the regulations and
published interpretations thereunder with respect to each Company Employee
Benefit Plan, and have performed all their obligations under each Company
Employee Benefit Plan, except where a failure to comply or perform could not
reasonably be expected to have a Material Adverse Effect. Each Company Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Internal
Revenue Code is so qualified.
B. No ERISA Event has occurred or is reasonably expected to occur.
C. Except to the extent required under Section 4980B of the Internal
Revenue Code or other applicable law or individual contract, no Company Employee
Benefit Plan provides health or welfare benefits (through the purchase of
insurance or otherwise) for any retired or former employee of Company, any of
its Subsidiaries or any of their respective ERISA Affiliates.
D. As of the most recent valuation date for any Pension Plan, and
excluding for purposes of such computation all Pension Plans with respect to
which assets exceed benefit liabilities (as defined in Section 4001(a)(16) of
ERISA), the sum of:
(i) the unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA) individually or in the aggregate for all Company
Pension Plans; and
(ii) the liability that Company or its Subsidiaries could
reasonably be expected to incur as the result of such unfunded benefit
liabilities, individually or in the aggregate, for all Pension Plans
other than Company Pension Plans (assuming amortization of such
unfunded benefit liabilities over ten years);
does not exceed $1 million.
E. As of the most recent valuation date for which an actuarial report
has been received and based on information available pursuant to Section 4221(e)
of ERISA, the sum of:
(i) the potential liability of Company and its Subsidiaries
for a complete withdrawal from all Multiemployer Plans (within the
meaning of Section 4203 of ERISA) to which Company or any of its
Subsidiaries contribute; and
(ii) the liability of Company or its Subsidiaries could be
reasonably be expected to incur as a result of the complete withdrawal
from all Multiemployer Plans to which neither Company nor any of its
Subsidiaries contribute, after considering the financial condition of
all of the ERISA Affiliates most closely related to the contributing
employer(s);
does not exceed $1 million.
5.12 Certain Fees
Other than as disclosed in the Tender Offer Materials, no broker's or
finder's fee or commission will be payable with respect to this Agreement or any
of the transactions contemplated hereby, and Company hereby indemnifies Lenders
against, and agrees that it will hold Lenders harmless from, any claim, demand
or liability for any such broker's or finder's fees alleged to have been
incurred in connection herewith or therewith and any expenses (including
reasonable fees, expenses and disbursements of counsel) arising in connection
with any such claim, demand or liability.
5.13 Environmental Protection
Except as set forth in Schedule 5.13 annexed hereto:
(i) neither Company nor any of its Subsidiaries nor any of
their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with
any Person relating to (a) any Environmental Law, (b) any Environmental
Claim, or (c) any Hazardous Materials Activity, except where such an
order, consent, decree or settlement agreement, individually or in the
aggregate, could not be reasonably expected to have a Material Adverse
Effect;
(ii) neither Company nor any of its Subsidiaries has received
any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act
(42 U.S.C. ss. 9604) or any comparable state law, except where such a
letter or request, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect;
(iii) there are and, to Company's knowledge, have been no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim
against Company or any of its Subsidiaries, except where such a
condition, occurrence or Hazardous Materials Activity, individually or
in the aggregate, could not reasonably be expected to have a Material
Adverse Effect;
(iv) neither Company nor any of its Subsidiaries nor, to
Company's knowledge, any predecessor of Company or any of its
Subsidiaries has filed any notice under any Environmental Law
indicating past or present treatment of Hazardous Materials at any
Facility, and none of Company's or any of its Subsidiaries' operations
involves the generation, transportation, treatment, storage or disposal
of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or any
state equivalent, except where such treatment or generation,
transportation, storage or disposal, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect; and
(v) compliance with all current or reasonably foreseeable
future requirements pursuant to or under Environmental Laws will not,
individually or in the aggregate, have a reasonable possibility of
giving rise to a Material Adverse Effect.
Notwithstanding anything in this subsection 5.13 to the contrary, no
event or condition has occurred or is occurring with respect to Company or any
of its Subsidiaries relating to any Environmental Law, any Release of Hazardous
Materials, or any Hazardous Materials Activity, including any matter disclosed
on Schedule 5.13 annexed hereto, which individually or in the aggregate, has had
or could reasonably be expected to have a Material Adverse Effect.
5.14 Employee Matters
There is no strike or work stoppage in existence or threatened
involving Company or any of its Subsidiaries that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
5.15 Solvency
Each Loan Party is and, upon the incurrence of any Obligations by such
Loan Party on any date on which this representation is made, will be, Solvent.
5.16 Matters Relating to Collateral
A. Creation, Perfection and Priority of Liens. The execution and
delivery of the Collateral Documents by Loan Parties, together with actions
taken pursuant to subsections 4.1G, 4.1H, 4.2E, 4.2F, 6.8 and 6.9 are effective
or, in the case of subsections 4.2E and 4.2F, will be effective as of the Merger
Date, or in the case of subsections 6.8 and 6.9, will be effective at the time
of the acquisition of such Subsidiaries, to create in favor of Administrative
Agent for the benefit of Lenders, as security for the respective Secured
Obligations (as defined in the applicable Collateral Document in respect of any
Collateral), a valid and perfected First Priority Lien on all of the Collateral.
B. Governmental Authorizations. No authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the pledge or grant by any Loan Party
of the Liens purported to be created in favor of Administrative Agent pursuant
to any of the Collateral Documents or (ii) the exercise by Administrative Agent
of any rights or remedies in respect of any Collateral (whether specifically
granted or created pursuant to any of the Collateral Documents or created or
provided for by applicable law), except for filings or recordings contemplated
by subsection 5.16A and except as may be required, in connection with the
disposition of any Pledged Collateral, by laws generally affecting the offering
and sale of securities.
C. Absence of Third-Party Filings. Except such as may have been filed
in favor of Administrative Agent, (i) no effective UCC financing statement,
fixture filing or other instrument similar in effect covering all or any part of
the Collateral is on file in any filing or recording office and (ii) no
effective filing covering all or any part of the IP Collateral is on file in the
PTO.
D. Margin Regulations. The pledge of the Pledged Collateral pursuant to
the Collateral Documents does not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System. E. Information Regarding Collateral.
All information supplied to Agents by or on behalf of any Loan Party with
respect to any of the Collateral (in each case taken as a whole with respect to
any particular Collateral) is accurate and complete in all material respects.
5.17 Related Agreements
A. Delivery of Related Agreements. Company has delivered to Lenders
complete and correct copies of each Related Agreement and of all exhibits and
schedules thereto.
B. Warranties. Subject to the qualifications set forth therein, each of
the representations and warranties given by Company, Acquisition Co. and Shelby
in the Merger Agreement is true and correct in all material respects as of the
date hereof (or as of any earlier date to which such representation and warranty
specifically relates) and will be true and correct in all material respects as
of the Closing Date and the Merger Date (or such earlier date as the case may
be).
C. Survival. Notwithstanding anything in the Merger Agreement to the
contrary, the representations and warranties of Company set forth in subsection
5.17B shall, solely for purposes of this Agreement, survive the Closing Date and
the Merger Date for the benefit of Lenders.
5.18 Disclosure
A. Loan Documents. No representation or warranty of any Loan Party
contained in any Loan Document or Related Agreement or in any other document,
certificate or written statement furnished to Lenders by or on behalf of Company
or any of its Subsidiaries for use in connection with the transactions
contemplated by this Agreement contains any untrue statement of a material fact
or omits to state a material fact (known to Company, in the case of any document
not furnished by it) necessary in order to make the statements contained herein
or therein not misleading in light of the circumstances in which the same were
made. Any projections and pro forma financial information contained in such
materials are based upon good faith estimates and assumptions believed by
Company to be reasonable at the time made, it being recognized by Lenders that
such projections as to future events are not to be viewed as facts and that
actual results during the period or periods covered by any such projections may
differ from the projected results. There are no facts known (or which should
upon the reasonable exercise of diligence be known) to Company (other than
matters of a general economic nature) that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect and that
have not been disclosed herein or in such other documents, certificates and
statements furnished to Lenders for use in connection with the transactions
contemplated hereby.
B. Tender Offer Materials. The Tender Offer Materials do not contain
any untrue statement of a material fact or omit to state a material fact (known
to Company or any of its Subsidiaries, in the case of any document not furnished
by it) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made.
5.19 Year 2000 Compliance
All Information Systems and Equipment are either Year 2000 Compliant,
or any reprogramming, remediation or any other corrective action, including the
internal testing of all such Information Systems and Equipment, will be
completed by June 30, 1999. To the extent that such reprogramming/remediation
and testing action is required, the cost thereof, as well as the cost of the
reasonably foreseeable consequences of failure to become Year 2000 Compliant, to
Company and its Subsidiaries (including without limitation reprogramming errors
and the failure or other systems or equipment) will not result in an Event of
Default or a Material Adverse Effect.
Section 6. COMPANY'S AFFIRMATIVE COVENANTS
Company covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Company shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 6.
6.1 Financial Statements and Other Reports
Company will maintain, and cause each of its Subsidiaries to maintain,
a system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in conformity
with GAAP. Company will deliver to Agents and Lenders:
(i) Quarterly Financials: as soon as available and in any
event within 45 days after the end of each Fiscal Quarter, (a) the
consolidated balance sheets of Company and its Subsidiaries as at the
end of such Fiscal Quarter and the related consolidated statements of
income, stockholders' equity and cash flows of Company and its
Subsidiaries for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal
Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous
Fiscal Year and the corresponding figures from the Financial Plan for
the current Fiscal Year, all in reasonable detail and certified by the
chief financial officer of Company that they fairly present, in all
material respects, the financial condition of Company and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end adjustments, and (b) a
narrative report describing the operations of Company and its
Subsidiaries in the form prepared for presentation to senior management
for such Fiscal Quarter and for the period from the beginning of the
then current Fiscal Year to the end of such Fiscal Quarter (it being
understood and agreed that the "Management Discussion and Analysis"
contained in the Company's quarterly report on Form 10-Q filed with the
Securities and Exchange Commission for such period or in Company's
annual report on Form 10-K filed with the Securities and Exchange
Commission shall be deemed to comply with the foregoing requirement);
(ii) Year-End Financials: as soon as available and in any
event within 90 days after the end of each Fiscal Year, (a) the
consolidated balance sheets of Company and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated statements of
income, stockholders' equity and cash flows of Company and its
Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the corresponding figures for the previous Fiscal Year
and, the corresponding figures from the Financial Plan for the Fiscal
Year covered by such financial statements, all in reasonable detail and
certified by the chief financial officer, chief accounting officer or
controller of Company that they fairly present, in all material
respects, the financial condition of Company and its Subsidiaries as at
the dates indicated and the results of their operations and their cash
flows for the periods indicated, (b) a narrative report describing the
operations of Company and its Subsidiaries in the form prepared for
presentation to senior management for such Fiscal Year, and (c) in the
case of such consolidated financial statements, a report thereon of
Xxxxxx Xxxxxxxx LLP or other independent certified public accountants
of recognized national standing selected by Company and satisfactory to
Administrative Agent, which report shall be unqualified, shall express
no doubts about the ability of Company and its Subsidiaries to continue
as a going concern, and shall state that such consolidated financial
statements fairly present, in all material respects, the consolidated
financial position of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated in conformity with GAAP applied on a basis
consistent with prior years (except as otherwise disclosed in such
financial statements) and that the examination by such accountants in
connection with such consolidated financial statements has been made in
accordance with generally accepted auditing standards;
(iii) Officers' and Compliance Certificates: together with
each delivery of financial statements pursuant to subdivisions (i) and
(ii) above, (a) an Officers' Certificate of Company stating that the
signers have reviewed the terms of this Agreement and have made, or
caused to be made under their supervision, a review in reasonable
detail of the transactions and condition of Company and its
Subsidiaries during the accounting period covered by such financial
statements and that such review has not disclosed the existence during
or at the end of such accounting period, and that the signers do not
have knowledge of the existence as at the date of such Officers'
Certificate, of any condition or event that constitutes an Event of
Default or Potential Event of Default, or, if any such condition or
event existed or exists, specifying the nature and period of existence
thereof and what action Company has taken, is taking and proposes to
take with respect thereto and (b) a Compliance Certificate
demonstrating in reasonable detail compliance during and at the end of
the applicable accounting periods with the restrictions contained in
Section 7, in each case to the extent compliance with such restrictions
is required to be tested at the end of the applicable accounting
period;
(iv) Reconciliation Statements: if, as a result of any change
in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 5.3, the consolidated financial statements of Company and
its Subsidiaries delivered pursuant to subdivisions (i), (ii) or (xii)
of this subsection 6.1 will differ in any material respect from the
consolidated financial statements that would have been delivered
pursuant to such subdivisions had no such change in accounting
principles and policies been made, then (a) together with the first
delivery of financial statements pursuant to subdivision (i), (ii) or
(xii) of this subsection 6.1 following such change, consolidated
financial statements of Company and its Subsidiaries for (x) the
current Fiscal Year to the effective date of such change and (y) the
full Fiscal Year immediately preceding the Fiscal Year in which such
change is made, in each case prepared on a pro forma basis as if such
change had been in effect during such periods, and (b) together with
each delivery of financial statements pursuant to subdivision (i), (ii)
or (xii) of this subsection 6.1 following such change, a written
statement of the chief accounting officer or chief financial officer of
Company setting forth the differences (including without limitation any
differences that would affect any calculations relating to the
financial covenants set forth in subsection 7.6) which would have
resulted if such financial statements had been prepared without giving
effect to such change;
(v) Accountants' Certification: together with each delivery of
consolidated financial statements of Company and its Subsidiaries
pursuant to subdivision (ii) above, a written statement by the
independent certified public accountants giving the report thereon (a)
stating that their audit examination has included a review of the terms
of Section 7 of this Agreement as they relate to accounting matters,
(b) stating whether, in connection with their audit examination, any
condition or event that constitutes an Event of Default or Potential
Event of Default has come to their attention and, if such a condition
or event has come to their attention, specifying the nature and period
of existence thereof; provided that such accountants shall not be
liable by reason of any failure to obtain knowledge of any such Event
of Default or Potential Event of Default that would not be disclosed in
the course of their audit examination, and (c) stating that based on
their audit examination nothing has come to their attention that causes
them to believe either or both that the information contained in the
certificates delivered therewith pursuant to subdivision (iii) above is
not correct or that the matters set forth in the Compliance
Certificates delivered therewith pursuant to clause (c) of subdivision
(iii) above for the applicable Fiscal Year are not stated in accordance
with the terms of this Agreement;
(vi) Accountants' Reports: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of all
reports submitted to Company by independent certified public
accountants in connection with each annual, interim or special audit of
the financial statements of Company and its Subsidiaries made by such
accountants, including any comment letter submitted by such accountants
to management in connection with their annual audit;
(vii) SEC Filings and Press Releases: promptly upon their
becoming available, copies of (a) all financial statements, reports,
notices and proxy statements sent or made available generally by
Company to its security holders or by any Subsidiary of Company to its
security holders other than Company or another Subsidiary of Company,
(b) all regular and periodic reports and all registration statements
(other than on Form S-8 or a similar form) and prospectuses, if any,
filed by Company or any of its Subsidiaries with any securities or with
the Securities and Exchange Commission or any governmental or private
regulatory authority, and (c) all press releases and other statements
made available generally by Company or any of its Subsidiaries to the
public concerning material developments in the business of Company or
any of its Subsidiaries;
(viii) Events of Default, etc.: promptly upon any officer of
Company obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or
becoming aware that any Lender has given any notice (other than to
Administrative Agent) or taken any other action with respect to a
claimed Event of Default or Potential Event of Default, (b) that any
Person has given any notice to Company or any of its Subsidiaries or
taken any other action with respect to a claimed default or event or
condition of the type referred to in subsection 8.2, (c) of any
condition or event that would be required to be disclosed in a current
report filed by Company with the Securities and Exchange Commission on
Form 8-K (Items 1, 2, 4, 5 and 6 of such Form as in effect on the date
hereof) whether or not Company is required to file such reports under
the Exchange Act, or (d) of the occurrence of any event or change that
has caused or evidences, either in any case or in the aggregate, a
Material Adverse Effect, an Officers' Certificate specifying the nature
and period of existence of such condition, event or change, or
specifying the notice given or action taken by any such Person and the
nature of such claimed Event of Default, Potential Event of Default,
default, event or condition, and what action Company has taken, is
taking and proposes to take with respect thereto;
(ix) Litigation or Other Proceedings: (a) promptly upon any
officer of Company obtaining knowledge of (X) the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries (collectively,
"Proceedings") not previously disclosed in writing by Company to
Lenders or (Y) any material development in any Proceeding that, in any
case:
(1) if adversely determined, could reasonably be expected
to have a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the consummation
of, or to recover any damages or obtain relief as a result of, the
transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their respective
counsel to evaluate such matters; and (b) within twenty days after the
end of each Fiscal Quarter, a schedule of all Proceedings involving an
alleged liability of, or claims against or affecting, Company or any of
its Subsidiaries equal to or greater than $500,000, and promptly after
request by Administrative Agent such other information as may be
reasonably requested by Administrative Agent to enable Administrative
Agent and its respective counsel to evaluate any of such Proceedings;
(x) ERISA Events: promptly upon Company becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Company, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(xi) ERISA Notices: with reasonable promptness, copies of (a)
all notices received by Company, any of its Subsidiaries or (if
obtained by Company) any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (b) copies of
such other documents or governmental reports or filings relating to any
Employee Benefit Plan as Administrative Agent shall reasonably request;
(xii) Financial Plans: as soon as practicable and in any event
no later than thirty (30) days after the beginning of the Fiscal Year
ending on or about October 31, 1999 and thirty (30) days prior to the
beginning of each subsequent Fiscal Year, a consolidated and
consolidating plan and financial forecast for such Fiscal Year and the
next four succeeding Fiscal Years (the "Financial Plan" for such Fiscal
Years), including (a) a forecasted consolidated balance sheet and
forecasted consolidated statements of income and cash flows of Company
and its Subsidiaries for each such Fiscal Year and an explanation of
the assumptions on which such forecasts are based, (b) forecasted
consolidated statements of income and cash flows of Company and its
Subsidiaries for each quarter of the first such Fiscal Year, together
with pro forma financial covenant calculations for such Fiscal Year
determined in a manner consistent with financial covenant calculations
shown in a Compliance Certificate, together with an explanation of the
assumptions on which such forecasts are based, (c) the amount of
forecasted unallocated overhead for each such Fiscal Year, and (d) such
other information and projections as Administrative Agent or any Lender
may reasonably request;
(xiii) Insurance: as soon as practicable and in any event by
the last day of each Fiscal Year, a report in form and substance
satisfactory to Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by Company and its
Subsidiaries and all material insurance coverage planned to be
maintained by Company and its Subsidiaries in the immediately
succeeding Fiscal Year;
(xiv) Board of Directors: with reasonable promptness, written
notice of any change in the Board of Directors of Company;
(xv) New Subsidiaries: promptly upon any Person becoming a
Subsidiary of Company, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Company and (b) all of the data required to be set forth in Schedule
5.1 with respect to all Subsidiaries of Company (it being understood
that such written notice shall be deemed to supplement Schedule 5.1 for
all purposes of this Agreement);
(xvi) UCC Search Report: As promptly as practicable after the
date of delivery to Administrative Agent of any UCC financing statement
executed by any Loan Party pursuant to subsection 4.1H, 4.2F or 6.8A,
copies of completed UCC searches evidencing the proper filing,
recording and indexing of all such UCC financing statement and listing
all other effective financing statements that name such Loan Party as
debtor, together with copies of all such other financing statements not
previously delivered to Administrative Agent by or on behalf of Company
or such Loan Party;
(xvii) Margin Determination Certificate: together with each
delivery of financial statements pursuant to subdivisions (i) and (ii)
above, a Margin Determination Certificate demonstrating in reasonable
detail the calculation of the Consolidated Leverage Ratio for the four
consecutive Fiscal Quarters ending on the day of the accounting period
covered by such financial statements; and
(xviii) Other Information: with reasonable promptness, such
other information and data with respect to Company or any of its
Subsidiaries as from time to time may be reasonably requested by
Administrative Agent or any Lender.
6.2 Legal Existence, etc.
Except as permitted under subsection 7.7, Company will, and will cause
each of its Subsidiaries to, at all times preserve and keep in full force and
effect its legal existence and all rights and franchises material to its
business; provided, however, that neither Company nor any of its Subsidiaries
shall be required to preserve any such right or franchise if the Board of
Directors of Company or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of Company or such
Subsidiary, as the case may be, and that the loss thereof is not disadvantageous
in any material respect to Company, such Subsidiary or Lenders.
6.3 Payment of Taxes and Claims; Tax Consolidation
A. Company will, and will cause each of its Subsidiaries to, pay all
taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all claims (including claims
for labor, services, materials and supplies) for sums that have become due and
payable and that by law have or may become a material Lien upon any of its
properties or assets, prior to the time when any penalty or fine shall be
incurred with respect thereto; provided that no such charge or claim need be
paid if it is being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted, so long as (1) such reserve or other
appropriate provision, if any, as shall be required in conformity with GAAP
shall have been made therefor and (2) in the case of a charge or claim which has
or may become a Lien against any of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the Collateral to
satisfy such charge or claim.
B. Company will not, nor will it permit any of its Subsidiaries to,
file or consent to the filing of any consolidated income tax return with any
Person (other than Company or any of its Subsidiaries).
6.4 Maintenance of Properties; Insurance; Application of Net Insurance/
Condemnation Proceeds
A. Maintenance of Properties. Company will, and will cause each of its
Subsidiaries to, maintain or cause to be maintained in good repair, working
order and condition, ordinary wear and tear excepted, all material properties
used or useful in the business of Company and its Subsidiaries (including all
Intellectual Property) and from time to time will make or cause to be made all
appropriate repairs, renewals and replacements thereof.
B. Insurance. Company will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Company and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by corporations
of established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for
corporations similarly situated in the industry. Without limiting the generality
of the foregoing, Company will maintain or cause to be maintained (i) flood
insurance with respect to each Flood Hazard Property that is located in a
community that participates in the National Flood Insurance Program, in each
case in compliance with any applicable regulations of the Board of Governors of
the Federal Reserve System, and (ii) replacement value casualty insurance on the
Collateral under such policies of insurance, with such insurance companies, in
such amounts, with such deductibles, and covering such risks as are at all times
satisfactory to Administrative Agent in its commercially reasonable judgment.
Each such policy of insurance shall (a) name Administrative Agent for the
benefit of Lenders as an additional insured thereunder as its interests may
appear and (b) in the case of each business interruption and casualty insurance
policy, contain a loss payable clause or endorsement, satisfactory in form and
substance to Administrative Agent, that names Administrative Agent for the
benefit of Lenders as the loss payee thereunder for any covered loss in excess
of $1 million and provides for at least 30 days prior written notice to
Administrative Agent of any modification or cancellation of such policy.
C. Application of Net Insurance/Condemnation Proceeds.
(i) Business Interruption Insurance. Upon receipt by Company
or any of its Subsidiaries of any business interruption insurance
proceeds constituting Net Insurance/Condemnation Proceeds, (a) so long
as no Event of Default or Potential Event of Default shall have
occurred and be continuing, Company or such Subsidiary may retain and
apply such Net Insurance/Condemnation Proceeds for working capital
purposes, and (b) if an Event of Default or Potential Event of Default
shall have occurred and be continuing, Company shall apply an amount
equal to such Net Insurance/Condemnation Proceeds to prepay the Loans
(and/or the Revolving Loan Commitments shall be reduced) as provided in
subsection 2.4B(iii)(b);
(ii) Casualty Insurance/Condemnation Proceeds. Upon receipt by
Company or any of its Subsidiaries of any Net Insurance/Condemnation
Proceeds other than from business interruption insurance, (a) so long
as no Event of Default or Potential Event of Default shall have
occurred and be continuing, Company shall, or shall cause one or more
of its Subsidiaries to, promptly and diligently apply such Net
Insurance/Condemnation Proceeds to pay or reimburse the costs of
repairing, restoring or replacing the assets in respect of which such
Net Insurance/Condemnation Proceeds were received or, to the extent not
so applied, to prepay the Loans (and/or the Revolving Loan Commitments
shall be reduced) as provided in subsection 2.4B(iii)(b), and (b) if an
Event of Default or Potential Event of Default shall have occurred and
be continuing, Company shall apply an amount equal to such Net
Insurance/Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b); provided that the aggregate amount applied by Company to
pay or reimburse the costs of repairing, restoring or replacing such
assets pursuant to the foregoing clause (a) shall not exceed $10
million for any Fiscal Year.
(iii) Net Insurance/Condemnation Proceeds Received by
Administrative Agent. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, if and to the extent
Company would have been required to apply such Net
Insurance/Condemnation Proceeds (if it had received them directly) to
prepay the Loans and/or reduce the Revolving Loan Commitments,
Administrative Agent shall, and Company hereby authorizes
Administrative Agent to, apply such Net Insurance/Condemnation Proceeds
to prepay the Loans (and/or the Revolving Loan Commitments shall be
reduced) as provided in subsection 2.4B(iii)(b), and (b) to the extent
the foregoing clause (a) does not apply and (1) the aggregate amount of
such Net Insurance/Condemnation Proceeds received (and reasonably
expected to be received) by Administrative Agent in respect of any
covered loss does not exceed $5 million, Administrative Agent shall
deliver such Net Insurance/Condemnation Proceeds to Company, and
Company shall, or shall cause one or more of its Subsidiaries to,
promptly apply such Net Insurance/Condemnation Proceeds to the costs of
repairing, restoring, or replacing the assets in respect of which such
Net Insurance/Condemnation Proceeds were received, and (2) if the
aggregate amount of Net Insurance/Condemnation Proceeds received (and
reasonably expected to be received) by Administrative Agent in respect
of any covered loss exceeds $5 million, Administrative Agent shall hold
such Net Insurance/Condemnation Proceeds pursuant to the terms of the
Collateral Account Agreement and, so long as Company or any of its
Subsidiaries proceeds diligently to repair, restore or replace the
assets of Company or such Subsidiary in respect of which such Net
Insurance/Condemnation Proceeds were received, Administrative Agent
shall from time to time disburse to Company or such Subsidiary from the
Collateral Account, to the extent of any such Net
Insurance/Condemnation Proceeds remaining therein in respect of the
applicable covered loss, amounts necessary to pay the cost of such
repair, restoration or replacement after the receipt by Administrative
Agent of invoices or other documentation reasonably satisfactory to
Administrative Agent relating to the amount of costs so incurred and
the work performed (including, if required by Administrative Agent,
lien releases and architects' certificates); provided, however that if
at any time Administrative Agent reasonably determines (A) that Company
or such Subsidiary is not proceeding diligently with such repair,
restoration or replacement or (B) that such repair, restoration or
replacement cannot be completed with the Net Insurance/Condemnation
Proceeds then held by Administrative Agent for such purpose, together
with funds otherwise available to Company for such purpose, or that
such repair, restoration or replacement cannot be completed within 360
days after the receipt by Administrative Agent of such Net
Insurance/Condemnation Proceeds, Administrative Agent shall, and
Company hereby authorizes Administrative Agent to, apply such Net
Insurance/ Condemnation Proceeds to prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) as provided in subsection
2.4B(iii)(b).
6.5 Inspection Rights; Lender Meeting
A. Inspection Rights. Company shall, and shall cause each of its
Subsidiaries to, permit any authorized representatives designated by
Administrative Agent or any Lender to visit and inspect any of the properties of
Company or of any of its Subsidiaries, to inspect, copy and take extracts from
its and their financial and accounting records, and to discuss its and their
affairs, finances and accounts with its and their officers and independent
public accountants (provided that Company may, if it so chooses, be present at
or participate in any such discussion), all upon reasonable notice and at such
reasonable times during normal business hours and as often as may reasonably be
requested.
B. Lender Meeting. Company will, upon the request of Administrative
Agent or Requisite Lenders, participate in a meeting of Administrative Agent and
Lenders once during each Fiscal Year to be held at Company's corporate offices
(or at such other location as may be agreed to by Company and Administrative
Agent) at such time as may be agreed to by Company and Administrative Agent.
6.6 Compliance with Laws, etc.
Company shall comply, and shall cause each of its Subsidiaries and all
other Persons on or occupying any Facilities to comply, with the requirements of
all applicable laws, rules, regulations and orders of any governmental authority
(including all Environmental Laws), noncompliance with which could reasonably be
expected to cause, individually or in the aggregate, a Material Adverse Effect.
6.7 Environmental Review and Investigation, Disclosure, Etc.; Company's Actions
Regarding Hazardous Materials Activities, Environmental Claims and Violations of
Environmental Laws
A. Environmental Review and Investigation. Company agrees that
Administrative Agent may, from time to time and in its reasonable discretion, at
Company's expense, (i) retain an independent professional consultant to review
any environmental audits, investigations, analyses and reports relating to
Hazardous Materials prepared by or for Company and (ii) conduct its own
investigation of any Facility; provided that, in the case of any Facility no
longer owned, leased, operated or used by Company or any of its Subsidiaries,
Company shall only be obligated to use its reasonable good faith efforts to
obtain permission for Administrative Agent's professional consultant to conduct
an investigation of such Facility. For purposes of conducting such a review
and/or investigation, Company hereby grants to Administrative Agent and its
respective agents, employees, consultants and contractors the right to enter
into or onto any Facilities currently owned, leased, operated or used by Company
or any of its Subsidiaries and to perform such tests on such property (including
taking samples of soil, groundwater and suspected asbestos-containing materials)
as are reasonably necessary in connection therewith. Any such investigation of
any Facility shall be conducted, unless otherwise agreed to by Company and
Administrative Agent, during normal business hours and, to the extent reasonably
practicable, shall be conducted so as not to interfere with the ongoing
operations at such Facility or to cause any damage or loss to any property at
such Facility. So long as no Event of Default or Potential Event of Default has
occurred and is continuing, Administrative Agent shall provide reasonable notice
to Company prior to the inspection of any Facility. Company and Administrative
Agent hereby acknowledge and agree that any report of any investigation
conducted at the request of Administrative Agent pursuant to this subsection
6.7A will be obtained and shall be used by Administrative Agent and Lenders for
the purposes of Lenders' internal credit decisions, to monitor and police the
Loans and to protect Lenders' security interests, if any, created by the Loan
Documents. Administrative Agent agrees to deliver a copy of any such report to
Company with the understanding that Company acknowledges and agrees that (x) it
will indemnify and hold harmless Administrative Agent and each Lender from any
costs, losses or liabilities relating to Company's use of or reliance on such
report, (y) none of the Administrative Agent nor any Lender makes any
representation or warranty with respect to such report, and (z) by delivering
such report to Company, none of the Administrative Agent nor any Lender is
requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
B. Environmental Disclosure. Company will deliver to Administrative
Agent and Lenders:
(i) Environmental Audits and Reports. As soon as practicable
following receipt thereof, copies of all environmental audits,
investigations, analyses and reports of any kind or character, whether
prepared by personnel of Company or any of its Subsidiaries or by
independent consultants, governmental authorities or any other Persons,
with respect to significant environmental matters at any Facility
which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect or with respect to any
Environmental Claims which, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc.
Promptly upon the occurrence thereof, written notice describing in
reasonable detail (a) any Release required to be reported to any
federal, state or local governmental or regulatory agency under any
applicable Environmental Laws, (b) any remedial action taken by Company
or any other Person of which Company has knowledge in response to (1)
any Hazardous Materials Activities the existence of which has a
reasonable possibility of resulting in one or more Environmental Claims
having, individually or in the aggregate, a Material Adverse Effect, or
(2) any Environmental Claims that, individually or in the aggregate,
have a reasonable possibility of resulting in a Material Adverse
Effect, and (c) Company's discovery of any occurrence or condition on
any real property adjoining or in the vicinity of any Facility that
could cause such Facility or any part thereof to be subject to any
material restrictions on the ownership, occupancy, transferability or
use thereof under any Environmental Laws.
(iii) Written Communications Regarding Environmental Claims,
Releases, Etc. As soon as practicable following the sending or receipt
thereof by Company or any of its Subsidiaries, a copy of any and all
written communications with respect to (a) any Environmental Claims
that, individually or in the aggregate, have a reasonable possibility
of giving rise to a Material Adverse Effect, (b) any Release required
to be reported to any federal, state or local governmental or
regulatory agency, and (c) any request for information from any
governmental agency that suggests such agency is investigating whether
Company or any of its Subsidiaries may be potentially responsible for
any Hazardous Materials Activity.
(iv) Notice of Certain Proposed Actions Having Environmental
Impact. Prompt written notice describing in reasonable detail (a) any
proposed acquisition of stock, assets, or property by Company or any of
its Subsidiaries that could reasonably be expected to (1) expose
Company or any of its Subsidiaries to, or result in, Environmental
Claims that could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect or (2) affect the ability of
Company or any of its Subsidiaries to maintain in full force and effect
all material Governmental Authorizations required under any
Environmental Laws for their respective operations and (b) any proposed
action to be taken by Company or any of its Subsidiaries to commence
manufacturing or other industrial operations or to modify current
operations in a manner that could reasonably be expected to subject
Company or any of its Subsidiaries to any additional obligations or
requirements under any Environmental Laws.
(v) Other Information. With reasonable promptness, such other
documents and information as from time to time may be reasonably
requested by Administrative Agent in relation to any matters disclosed
pursuant to this subsection 6.7.
C. Company's Actions Regarding Hazardous Materials Activities,
Environmental Claims and Violations of Environmental Laws.
(i) Remedial Actions Relating to Hazardous Materials
Activities. Company shall promptly undertake, and shall cause each of
its Subsidiaries promptly to undertake, any and all investigations,
studies, sampling, testing, abatement, cleanup, removal, remediation or
other response actions necessary to remove, remediate, clean up or
xxxxx any Hazardous Materials Activity on, under or about any Facility
that is in violation of any Environmental Laws or that presents a
material risk of giving rise to an Environmental Claim. In the event
Company or any of its Subsidiaries undertakes any such action with
respect to any Hazardous Materials, Company or such Subsidiary shall
conduct and complete such action in compliance with all applicable
Environmental Laws and in accordance with the policies, orders and
directives of all federal, state and local governmental authorities
except when, and only to the extent that, Company's or such
Subsidiary's liability with respect to such Hazardous Materials
Activity is being contested in good faith by Company or such
Subsidiary.
(ii) Actions with Respect to Environmental Claims and
Violations of Environmental Laws. Company shall promptly take, and
shall cause each of its Subsidiaries promptly to take, any and all
actions necessary to (a) cure any violation of applicable Environmental
Laws by Company or its Subsidiaries that could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect
and (b) make an appropriate response to any Environmental Claim against
Company or any of its Subsidiaries and discharge any obligations it may
have to any Person thereunder where failure to do so could reasonably
be expected to have, individually or in the aggregate, a Material
Adverse Effect.
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral
Documents by Certain Subsidiaries and Future Subsidiaries; IP Collateral
A. Execution of Subsidiary Guaranty and Personal Property Collateral
Documents. In the event that any Person (other than an Inactive Subsidiary)
becomes a Domestic Subsidiary of Company or any Domestic Subsidiary of Company
after the Closing Date, Company will promptly notify Administrative Agent of
that fact and (i) Company or such Domestic Subsidiary shall execute and deliver
to Administrative Agent a Pledge Amendment (as defined in the Pledge Agreement
and the Subsidiary Pledge Agreements) to the Pledge Agreement or Subsidiary
Pledge Agreement executed and delivered by Company or such Domestic Subsidiary
pledging all of the stock of such Domestic Subsidiary owned by Company or such
Domestic Subsidiary and (ii) cause such Domestic Subsidiary to execute and
deliver to Administrative Agent a counterpart of the Subsidiary Guaranty and, as
applicable, a Subsidiary Pledge Agreement, a Subsidiary Security Agreement and
Additional Mortgages (as defined in subsection 6.9) and to take all such further
actions and execute all such further documents and instruments (including
actions, documents and instruments comparable to those described in subsection
4.1H) as may be necessary or, in the opinion of Administrative Agent, desirable
to create in favor of Administrative Agent, for the benefit of Lenders, a valid
and perfected First Priority Lien on all of the personal and mixed property
assets of such Subsidiary described in the applicable forms of Collateral
Documents.
B. Execution of Future Foreign Subsidiary Guaranty and Collateral
Documents. In the event that any Person (other than an Inactive Subsidiary)
becomes a direct Foreign Subsidiary of Company or any Domestic Subsidiary of
Company after the Closing Date, Company will promptly notify Administrative
Agent of that fact and Company or such Domestic Subsidiary will execute a Pledge
Amendment (as defined in the Pledge Agreement and the Subsidiary Pledge
Agreements) to the Pledge Agreement or Subsidiary Pledge Agreement executed and
delivered by Company or such Domestic Subsidiary pledging not less than 66% of
the stock of such Foreign Subsidiary. In the event that U.S. tax laws and/or any
other applicable laws in foreign jurisdictions, as the case may be, are amended
to permit a Foreign Subsidiary to guarantee the Loans without the incurrence of
an investment in U.S. property or other deemed dividends for U.S. tax purposes
or without otherwise resulting in U.S. taxable income or without otherwise
violating any other applicable laws in foreign jurisdictions, Company will
promptly notify Administrative Agent of that fact and Company or such Domestic
Subsidiary will execute Pledge Amendments to the Pledge Agreement or Subsidiary
Pledge Agreement executed and delivered by Company or such Domestic Subsidiary
pledging not less than 100% of the stock of its Foreign Subsidiaries (other than
Inactive Subsidiaries) and Company will cause its Foreign Subsidiaries (other
than Inactive Subsidiaries) to execute and deliver to Administrative Agent a
counterpart of a Subsidiary Guaranty, a Subsidiary Pledge Agreement, a
Subsidiary Security Agreement and Additional Mortgages, as applicable, and to
take all such further action and execute all such further documents and
instruments as may be reasonably required to grant and perfect in favor of
Administrative Agent, for the benefit of Lenders, a First Priority security
interest in all of the personal and mixed property assets of such Subsidiary
described in the applicable Collateral Documents.
C. Subsidiary Charter Documents, Legal Opinions, Etc. Company shall
deliver to Administrative Agent, together with such Loan Documents, (i)
certified copies of such Subsidiary's Certificate or Articles of Incorporation,
together with a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation and each other state in which such Person is
qualified as a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each to be dated a recent date prior to their
delivery to Administrative Agent, (ii) a copy of such Subsidiary's Bylaws
certified by its secretary or an assistant secretary as of a recent date prior
to their delivery to Administrative Agent, (iii) a certificate executed by the
secretary or an assistant secretary of such Subsidiary as to (a) the fact that
the attached resolutions of the Board of Directors of such Subsidiary approving
and authorizing the execution, delivery and performance of such Loan Documents
are in full force and effect and have not been modified or amended and (b) the
incumbency and signatures of the officers of such Subsidiary executing such Loan
Documents, and (iv) if required by the Administrative Agent, a favorable opinion
of counsel to such Subsidiary, in form and substance satisfactory to
Administrative Agent and its counsel, as to (a) the due organization and good
standing of such Subsidiary, (b) the due authorization, execution and delivery
by such Subsidiary of such Loan Documents, (c) the enforceability of such Loan
Documents against such Subsidiary, (d) such other matters (including matters
relating to the creation and perfection of Liens in any Collateral pursuant to
such Loan Documents) as Administrative Agent may reasonably request, all of the
foregoing to be satisfactory in form and substance to Administrative Agent and
its counsel.
D. Pledge of Foreign Subsidiary Stock. To the extent not otherwise
satisfied on the Closing Date with respect to Company's Foreign Subsidiaries and
to the extent not otherwise satisfied on the Merger Date with respect to
Shelby's Foreign Subsidiaries, no later than ninety (90) days after the Closing
Date or the Merger Date, as the case may be, Company and Shelby shall, and shall
cause each of its Subsidiaries owning Foreign Subsidiaries to, deliver to
Administrative Agent such Pledge Agreements executed with respect to the capital
stock of each such Foreign Subsidiary (other than Inactive Subsidiaries) and to
deliver such stock certificates and such other related documents or instruments
as Administrative Agent may reasonably request.
6.9 Leasehold Properties; Matters Relating to Additional Real Property
Collateral; Certain Opinions; Removal of Liens
A. Leasehold Properties.
To the extent not otherwise satisfied on the Closing Date with respect
to Company and its Subsidiaries and to the extent not otherwise satisfied on the
Merger Date with respect to Shelby and its Subsidiaries, Company, Shelby and
each applicable Subsidiary Guarantor shall use its reasonable good faith best
efforts (without requiring Company, Shelby or such Subsidiary Guarantor to
relinquish any material rights or incur any material obligations or to expend
more than a nominal amount of money as well as reasonable attorneys' fees
incurred by (x) the landlord under the applicable lease, (y) Administrative
Agent and (z) Company, Shelby or such Subsidiary Guarantor) to:
(i) Landlord Consents and Estoppels; Recorded Leasehold
Interests. Deliver to Administrative Agent no later than 60 days after
the Closing Date, in the case of each Material Leasehold Property of
Company or its Domestic Subsidiaries existing as of the Closing Date or
each Material Leasehold Property of Shelby or its Domestic Subsidiaries
existing as of the Merger Date, as the case may be, (a) a Landlord
Consent and Estoppel with respect thereto and (b) evidence that such
Material Leasehold Property is a Recorded Leasehold Interest; and
(ii) Conforming Leasehold Interests. If Company or any of its
Subsidiaries acquires any Material Leasehold Property after the Closing
Date, Company shall, or shall cause such Subsidiary to, use its
reasonable good faith best efforts (without requiring Company or such
Subsidiary to relinquish any material rights or incur any material
obligations or to expend more than a nominal amount of money as well as
reasonable attorneys' fees incurred by (x) the landlord under the
applicable lease, (y) Administrative Agent and (z) Company or such
Subsidiary) to cause such Material Leasehold Property to be a
Conforming Leasehold Interest.
B. Additional Mortgages, Etc. From and after the Closing Date, in the
event that (i) Company or any Subsidiary Guarantor acquires any fee interest in
real property or any Material Leasehold Property or (ii) at the time any Person
becomes a Subsidiary Guarantor, such Person owns or holds any fee interest in
real property or any Material Leasehold Property, in either case excluding any
such Real Property Asset the encumbrancing of which requires the consent of any
applicable lessor or (in the case of clause (ii) above) then-existing senior
lienholder, where Company and its Subsidiaries are unable to obtain such
lessor's or senior lienholder's consent (any such non-excluded Real Property
Asset described in the foregoing clause (i) or (ii) being an "Additional
Mortgaged Property"), Company or such Subsidiary Guarantor shall deliver to
Administrative Agent, as soon as practicable after such Person acquires such
Additional Mortgaged Property or becomes a Subsidiary Guarantor, as the case may
be, the following:
(i) Additional Mortgage. A fully executed and notarized
Mortgage (an "Additional Mortgage"), duly recorded in all appropriate
places in all applicable jurisdictions, encumbering the interest of
such Loan Party in such Additional Mortgaged Property;
(ii) Opinions of Counsel. If required by Administrative Agent,
(a) a favorable opinion of counsel to such Loan Party, in form and
substance satisfactory to Administrative Agent and its counsel, as to
the due authorization, execution and delivery by such Loan Party of
such Additional Mortgage and such other matters as Administrative Agent
may reasonably request, and (b) an opinion of counsel (which counsel
shall be reasonably satisfactory to Administrative Agent) in the state
in which such Additional Mortgaged Property is located with respect to
the enforceability of the form of Additional Mortgage recorded in such
state and such other matters (including any matters governed by the
laws of such state regarding personal property security interests in
respect of any Collateral) as Administrative Agent may reasonably
request, in each case in form and substance reasonably satisfactory to
Administrative Agent;
(iii) Landlord Consent and Estoppel; Recorded Leasehold
Interest. In the case of an Additional Mortgaged Property consisting of
a Material Leasehold Property, after using reasonable good faith best
efforts (without requiring Company or such Subsidiary Guarantor to
relinquish any material rights or incur any material obligations or to
expend more than a nominal amount of money as well as reasonable
attorneys' fees incurred by (i) the landlord under the applicable
lease, (ii) Administrative Agent and (iii) Company or such Subsidiary
Guarantor) to obtain the following, (a) a Landlord Consent and
Estoppel, unless Company or such Subsidiary is unable to obtain the
Landlord Consent and Estoppel and (b) evidence that such Material
Leasehold Property is a Recorded Leasehold Interest;
(iv) Title Insurance. (a) If required by Administrative Agent,
an ALTA mortgagee title insurance policy or an unconditional commitment
therefor (an "Additional Mortgage Policy") issued by the Title Company
with respect to such Additional Mortgaged Property, in an amount
reasonably satisfactory to Administrative Agent, insuring fee simple
title to, or a valid leasehold interest in, such Additional Mortgaged
Property vested in such Loan Party and assuring Administrative Agent
that such Additional Mortgage creates a valid and enforceable First
Priority mortgage Lien on such Additional Mortgaged Property, which
Additional Mortgage Policy (1) shall include, if available in the state
in which such Mortgaged Property is located, a lenders aggregation
endorsement, an endorsement for future advances under this Agreement
and for any other matters reasonably requested by Administrative Agent
and (2) shall provide for affirmative insurance and such reinsurance as
Administrative Agent may reasonably request, all of the foregoing in
form and substance reasonably satisfactory to Administrative Agent; and
(b) evidence satisfactory to Administrative Agent that such Loan Party
has (i) delivered to the Title Company all certificates and affidavits
required by the Title Company in connection with the issuance of the
Additional Mortgage Policy and (ii) paid to the Title Company or to the
appropriate governmental authorities all expenses and premiums of the
Title Company in connection with the issuance of the Additional
Mortgage Policy and all recording and stamp taxes (including mortgage
recording and intangible taxes) payable in connection with recording
the Additional Mortgage in the appropriate real estate records;
(v) Title Report. If no Additional Mortgage Policy is required
with respect to such Additional Mortgaged Property, a title report
issued by the Title Company with respect thereto, dated not more than
30 days prior to the date such Additional Mortgage is to be recorded
and satisfactory in form and substance to Administrative Agent;
(vi) Copies of Documents Relating to Title Exceptions. Copies
of all recorded documents listed as exceptions to title or otherwise
referred to in the Additional Mortgage Policy or title report delivered
pursuant to clause (iv) or (v) above;
(vii) Matters Relating to Flood Hazard Properties. (a)
Evidence, which may be in the form of a letter from an insurance broker
or a municipal engineer, as to (1) whether such Additional Mortgaged
Property is a Flood Hazard Property and (2) if so, whether the
community in which such Flood Hazard Property is located is
participating in the National Flood Insurance Program, (b) if such
Additional Mortgaged Property is a Flood Hazard Property, such Loan
Party's written acknowledgement of receipt of written notification from
Administrative Agent (1) that such Additional Mortgaged Property is a
Flood Hazard Property and (2) as to whether the community in which such
Flood Hazard Property is located is participating in the National Flood
Insurance Program, and (c) in the event such Additional Mortgaged
Property is a Flood Hazard Property that is located in a community that
participates in the National Flood Insurance Program, evidence that
Company has obtained flood insurance in respect of such Flood Hazard
Property to the extent required under the applicable regulations of the
Board of Governors of the Federal Reserve System; and
(viii) Surveys. ALTA Surveys of each Additional Mortgaged
Property satisfactory in form and substance to the Administrative Agent
and the Title Company reasonably current and certified to
Administrative Agent and Title Company by a licensed Surveyor.
(ix) Environmental Audit. If required by Administrative Agent,
reports and other information, in form, scope and substance
satisfactory to Administrative Agent and prepared by environmental
consultants satisfactory to Administrative Agent, concerning any
environmental hazards or liabilities to which Company or any of its
Subsidiaries may be subject with respect to such Additional Mortgaged
Property.
C. Real Estate Appraisals. Company shall, and shall cause each of its
Subsidiaries to, permit an independent real estate appraiser satisfactory to
Administrative Agent, upon reasonable notice, to visit and inspect any
Additional Mortgaged Property for the purpose of preparing an appraisal of such
Additional Mortgaged Property satisfying the requirements of any applicable laws
and regulations (in each case to the extent required under such laws and
regulations as determined by Administrative Agent in its discretion). Any such
inspection of any Additional Mortgaged Property shall be conducted, unless
otherwise agreed to by Company and Administrative Agent, during normal business
hours and, to the extent reasonably practicable, shall be conducted so as not to
interfere with the ongoing business operations at such Additional Mortgaged
Property.
D. Surveys. To the extent not otherwise satisfied on the Closing Date
with respect to Company and its Subsidiaries, and to the extent not otherwise
satisfied on the Merger Date with respect to Shelby and its Subsidiaries,
Company, Shelby and each Subsidiary Guarantor, as applicable, shall (a) no later
than thirty (30) days after the Closing Date or Merger Date, as the case may be,
deliver or cause to be delivered to Administrative Agent a survey for each of
the Mortgaged Properties, in the form more specifically described in Sections
4.1G(vi) and 4.2E(vi) above, (b) no later than fifteen (15) days after the
delivery of such surveys to Administrative Agent, cause the Title Company to
issue endorsements removing the standard survey exception (the "Survey
Endorsements") from the appropriate Closing Date Mortgage Policies and Merger
Date Mortgage Policies, (c) pay to the Title Company all costs associated with
the issuance of such Survey Endorsements and (d) in the event Administrative
Agent determined not to record a Mortgage against one or more Mortgaged
Properties on the Closing Date or the Merger Date, as the case may be, because
the survey for such Mortgaged Property was not available, Company shall deliver
such Mortgage no later than forty-five (45) days after the Closing Date or
Merger Date, as the case may be.
E. Removal of Liens. With respect to those Liens set forth on Schedule
5.5 annexed hereto, Company shall cause such Liens to be released of record
within 15 days of the Closing Date for Closing Date Mortgaged Properties or
within 15 days of the Merger Date for Merger Date Mortgaged Properties (as those
terms are defined in subsection 4.1G and 4.2E, respectively); provided that
Company may satisfy such requirement by causing Title Company to issue an
endorsement to the Closing Date Mortgage Policy and/or Merger Date Mortgage
Policy (as those terms are defined in subsection 4.1G and 4.2E, respectively)
removing the Liens set forth on Schedule 5.5 as an exception to such Title
Policies within the periods set forth herein for removal of such Liens.
6.10 Merger
Company shall cause Acquisition Co. and Shelby to comply with all
covenants set forth in the Merger Agreement applicable prior to the consummation
of the Merger. Company shall cause the Merger to be consummated as soon as
practicable in accordance with the terms and conditions of the Merger Agreement
but in any event no later than 120 calendar days after the Closing Date. In the
event that the Shelby Common Stock to be purchased concurrently with receipt of
the proceeds of the Loans on the Closing Date shall represent, in the aggregate,
not less than 90% of the outstanding shares of Shelby Common Stock so as to
permit Company to cause the Merger to occur in accordance with the terms of the
Merger Agreement and Section 253 of the Delaware General Corporation Law,
Company shall cause the Merger to be consummated as soon as practicable after
the Closing Date and in any event no later than five (5) Business Days after the
Closing Date.
6.11 Interest Rate Protection
Within ninety (90) days after the Merger Date, Company shall obtain and
shall thereafter maintain in effect for a period of not less than two years
after the Merger Date one or more Interest Rate Agreements with respect to the
Term Loans, in an aggregate notional principal amount of not less than 50% of
the Term Loans outstanding on the Merger Date, each such Interest Agreement to
be in form and substance satisfactory to Administrative Agent.
6.12 Year 2000 Compliance
Company will take all reasonable steps to ensure that its Information
Systems and Equipment are at all times after June 30, 1999 Year 2000 Compliant,
except insofar as the failure to do so will not result in a Material Adverse
Effect, and Company shall notify Administrative Agent and any Lender promptly
upon detecting any failure of the Information Systems and Equipment to be Year
2000 Compliant. In addition, Company shall provide Administrative Agent with
such information about its year 2000 computer readiness (including without
limitation information as to contingency plans, budgets and testing results) as
Administrative Agent or such Lender shall reasonably request.
Section 7. COMPANY'S NEGATIVE COVENANTS
Company covenants and agrees that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Company shall perform, and shall cause each of its Subsidiaries to perform, all
covenants in this Section 7.
7.1 Indebtedness
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
(i) Company may become and remain liable with respect to the
Obligations;
(ii) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations permitted by subsection 7.4 and,
upon any matured obligations actually arising pursuant thereto, the
Indebtedness corresponding to the Contingent Obligations so
extinguished;
(iii) Company and its Subsidiaries may become and remain
liable with respect to Indebtedness in respect of Capital Leases
entered into after the Closing Date and incurred for the purpose of
financing all or any part of the purchase price or cost of construction
or improvement of property, plant or equipment used in the business of
the Company or its Subsidiaries; provided that the aggregate
Indebtedness incurred in respect of such Capital Leases together with
mortgage financings or Purchase Money Indebtedness incurred pursuant to
subsection 7.1(vii), in each case incurred for purpose of financing all
or any part of the purchase price or cost of construction or
improvement of property, plant or equipment used in the business of the
Company or its Subsidiaries, does not exceed $5 million;
(iv) Company may become and remain liable with respect to
Indebtedness to any of its Subsidiary Guarantors and any of its Foreign
Subsidiaries, and any Subsidiary Guarantor of Company may become and
remain liable with respect to Indebtedness to Company or any other
Subsidiary Guarantor or any Foreign Subsidiary of Company and any
Foreign Subsidiary of Company may become and remain liable with respect
to Indebtedness (A) to Company or any Subsidiary Guarantor to the
extent that such Indebtedness is a permitted Investment by Company or
such Subsidiary Guarantor under subsection 7.3 and (B) to any other
Foreign Subsidiary of Company; provided that (a) all such intercompany
Indebtedness shall be evidenced by promissory notes; (b) all such
intercompany Indebtedness owed by Company to any of its Subsidiaries
shall be subordinated in right of payment to the payment in full of the
Obligations pursuant to the terms of the applicable promissory notes or
an intercompany subordination agreement, and (c) any payment by any
Subsidiary of Company under any guaranty of the Obligations shall
result in a pro tanto reduction of the amount of any intercompany
Indebtedness owed by such Subsidiary to Company or to any of its
Subsidiaries for whose benefit such payment is made;
(v) Company and its Subsidiaries, as applicable, may remain
liable with respect to Indebtedness and Capital Leases existing as of
the Closing Date, and described in Schedule 7.1 annexed hereto;
provided that the amount of such Indebtedness does not exceed
approximately $2.5 million;
(vi) Company may become and remain liable with respect to
Indebtedness evidenced by the Senior Subordinated Debt Securities in an
aggregate principal amount which does not exceed $100 million on the
Closing Date, and Company may further become and remain liable after
the Closing Date for an additional $25 million under the Senior
Subordinated Debt Indenture; provided that the proceeds of any such
additional Senior Subordinated Debt Securities shall be applied as
required under subsection 2.4B(iii)(d) or shall be used to make a
Permitted Acquisition;
(vii) Company and its Subsidiaries may become and remain
liable with respect to Purchase Money Indebtedness in an aggregate
principal amount not to exceed $3 million;
(viii) Company and its Domestic Subsidiaries may become and
remain liable with respect to other Indebtedness and Contingent
Obligations permitted under subsection 7.4(x) in an aggregate amount
not to exceed $3 million at any time outstanding; and
(ix) Company's Foreign Subsidiaries may become and remain
liable with respect to other Indebtedness and Contingent Obligations
permitted under subsection 7.4(xi) in an aggregate amount not to exceed
$5 million; provided that any such Indebtedness is non-recourse to
Company and its Domestic Subsidiaries.
7.2 Liens and Related Matters
A. Prohibition on Liens. Company shall not, and shall not permit any of
its Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Company or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any State or under any similar
recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens described in Schedule 7.2 annexed hereto;
(iv) Liens securing Indebtedness permitted under subsections
7.1(iii) and 7.1(vii) with respect to the property or assets financed
by such Indebtedness; and
(v) Liens securing Indebtedness incurred by a Foreign
Subsidiary under subsection 7.1(ix) and encumbering only the assets of
such Foreign Subsidiary.
Nothing in this subsection 7.2 shall prohibit (a) the sale, assignment,
transfer, conveyance or other disposition of any Margin Stock owned by Company
or any of its Subsidiaries for Cash at its fair value (as determined in good
faith by its Board of Directors) so long as proceeds are held as Cash or Cash
Equivalents or (b) the creation, incurrence, assumption or existence of any Lien
on or with respect to any Margin Stock.
B. Equitable Lien in Favor of Lenders. If Company or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; provided that, notwithstanding the foregoing,
this covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A; and provided further that Company shall under no circumstances
be required to make or cause to be made effective provision whereby the
Obligations will be secured, directly or indirectly, by Margin Stock.
C. No Further Negative Pledges. Except with respect to specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to an Asset Sale or held in
respect of Capital Leases permitted pursuant to subsection 7.1(iii), neither
Company nor any of its Subsidiaries shall enter into any agreement (other than
an agreement prohibiting only the creation of Liens securing Subordinated
Indebtedness) prohibiting the creation or assumption of any Lien upon any of its
properties or assets, whether now owned or hereafter acquired.
D. No Restrictions on Subsidiary Distributions to Company or Other
Subsidiaries. Except as provided herein, Company will not, and will not permit
any of its Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Company or any
other Subsidiary of Company, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (iii) make loans or
advances to Company or any other Subsidiary of Company, or (iv) transfer any of
its property or assets to Company or any other Subsidiary of Company.
7.3 Investments; Joint Ventures
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, including any
Joint Venture, except:
(i) Company and its Subsidiaries may make and own Investments
in Cash Equivalents;
(ii) Company and its Subsidiaries may continue to own the
Investments owned by them as of the Closing Date in any Subsidiaries of
Company;
(iii) Company and its wholly-owned Subsidiary Guarantors may
make Investments in any of Company's wholly-owned Subsidiary Guarantors
and Subsidiaries of Company may make Investments in Company;
(iv) Company and its Subsidiaries may make Consolidated
Capital Expenditures permitted by subsection 7.8;
(v) Company and its Subsidiaries may continue to own the
Investments owned by them as of the Closing Date and described in
Schedule 7.3 annexed hereto;
(vi) Company and its Subsidiaries may make and own Investments
in Permitted Acquisitions permitted under subsection 7.7(vii); and
(vii) Company and its Subsidiaries may make and own other
Investments in an aggregate amount not to exceed at any time $5
million.
7.4 Contingent Obligations
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Subsidiaries of Company may become and remain liable with
respect to Contingent Obligations in respect of the Subsidiary
Guaranty;
(ii) Company may become and remain liable with respect to
Contingent Obligations in respect of Letters of Credit;
(iii) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations under (x) Interest Rate
Agreements with Lenders with respect to Indebtedness in an aggregate
notional principal amount not to exceed at any time the aggregate
amount of the Commitments and (y) Currency Agreements with Lenders
entered into in the ordinary course of business for hedging purposes;
(iv) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with Asset Sales or other sales of assets;
(v) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations under guarantees in the ordinary
course of business of the obligations of suppliers, customers,
franchisees and licensees of Company and its Subsidiaries in an
aggregate amount not to exceed at any time $500,000;
(vi) Company and its Subsidiaries may become and remain liable
with respect to Contingent Obligations in respect of any Indebtedness
of Company or any of its wholly-owned Subsidiaries permitted by
subsection 7.1;
(vii) Company and its Subsidiaries, as applicable, may remain
liable with respect to Contingent Obligations described in Schedule 7.4
annexed hereto;
(viii) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations in connection with
Operating Leases;
(ix) Subsidiary Guarantors may become and remain liable with
respect to Contingent Obligations arising under subordinated guaranties
of the Senior Subordinated Debt Securities as set forth in and to the
extent required under the Senior Subordinated Debt Indenture as in
effect on the Closing Date;
(x) Company and its Domestic Subsidiaries may become and
remain liable with respect to other Contingent Obligations; provided
that the maximum aggregate liability, contingent or otherwise, of
Company and its Domestic Subsidiaries in respect of all such Contingent
Obligations, together with the aggregate principal amount of all
Indebtedness permitted under subsection 7.1(viii), shall at no time
exceed $3 million; and
(xi) Company's Foreign Subsidiaries may become and remain
liable with respect to other Contingent Obligations; provided that the
Contingent Obligations are non-recourse to Company and its Domestic
Subsidiaries and the maximum aggregate liability, contingent or
otherwise, of Company's Foreign Subsidiaries in respect of all such
Contingent Obligations, together with the aggregate principal amount of
all Indebtedness permitted under subsection 7.1(ix), shall at no time
exceed $5 million.
7.5 Restricted Junior Payments
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, declare, order, pay, make or set apart any sum for any
Restricted Junior Payment; provided that so long as no Potential Event of
Default or Event of Default shall have occurred and be continuing or occurs as a
result thereof:
(i) Company may make Restricted Junior Payments consisting of
cash dividends paid on Company's common stock in accordance with
Company's historical dividend policies in an aggregate amount not to
exceed $1,500,000 in any Fiscal Year;
(ii) Company may make payments in respect of statutory
appraisal rights (and any settlement thereof) exercised by holders of
outstanding Shelby Common Stock in connection with the Merger; and
(iii) Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, declare, order, pay, make or
set apart any sum for payment on the Senior Subordinated Debt
Securities; provided that Company may make payments of regularly
scheduled interest in respect of the Senior Subordinated Debt
Securities in accordance with the terms of and to the extent required
by, and subject to the subordination provisions contained in, the
Senior Subordinated Debt Indenture.
7.6 Financial Covenants
A. Minimum Fixed Charge Coverage Ratio. Company shall not permit the
Consolidated Fixed Charge Coverage Ratio, calculated on a Pro Forma Basis,
during any of the periods set forth below to be less than the correlative ratio
indicated:
Minimum Fixed Charge Coverage
Period Ratio
--------------------------------------------------------------------------------
4th Fiscal Quarter of Fiscal Year 1999
to 4th Fiscal Quarter of Fiscal Year 2002 1.10:1.00
1st Fiscal Quarter of Fiscal Year 2003 and 1.05:1.00
thereafter
B. Maximum Consolidated Leverage Ratio. Company shall not permit the
Consolidated Leverage Ratio, calculated on a Pro Forma Basis, for any
four-Fiscal Quarter period ending during any of the periods set forth below to
exceed the correlative ratio indicated:
Maximum Consolidated Leverage
Period Ratio
-------------------------------------------------------------------------------
4th Fiscal Quarter of Fiscal Year 1999 4.90:1.00
1st Fiscal Quarter of Fiscal Year 2000 4.75:1.00
through 2nd Fiscal Quarter of Fiscal
Year 2000
3rd Fiscal Quarter of Fiscal Year 2000 4.50:1.00
through 4th Fiscal Quarter of Fiscal
Year 0000
0xx Xxxxxx Xxxxxxx of Fiscal Year 2001 4.25:1.00
through 4th Fiscal Quarter of Fiscal
Year 0000
0xx Xxxxxx Xxxxxxx of Fiscal Year 2002 4.00:1.00
through 4th Fiscal Quarter of Fiscal
Year 0000
0xx Xxxxxx Xxxxxxx of Fiscal Year 2004 3.75:1.00
and thereafter
C. Minimum Consolidated EBITDA. Company shall not permit Consolidated
EBITDA for any consecutive four-Fiscal Quarter period ending during any of the
periods set forth below to be less than the correlative amount indicated:
Minimum Consolidated
Period EBITDA
------------------------------------------------------------------------------
4th Fiscal Quarter of Fiscal Year 1999 $38 million
1st Fiscal Quarter of Fiscal Year 2000 $39 million
2nd Fiscal Quarter of Fiscal Year 2000
through 4th $40 million
Fiscal Quarter of Fiscal Year 2001
Fiscal Year 2002 $42 million
Fiscal Year 2003 $45 million
Fiscal Year 2004 and thereafter $47 million
D. Minimum Consolidated Net Worth. Company shall not permit
Consolidated Net Worth at any time during any of the periods set forth below to
be less than the correlative amount indicated:
Minimum Consolidated
Period Net Worth
--------------------------------------------------------------------------------
4th Fiscal Quarter of Fiscal Year 1999 $60 million
Fiscal Year 2000 $75 million
Fiscal Year 2001 $80 million
Fiscal Year 2002 $85 million
Fiscal Year 2003 $90 million
Fiscal Year 2004 and thereafter $95 million
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions
Company shall not, and shall not permit any of Company's Subsidiaries
to, alter the corporate, capital or legal structure of Company or any of
Company's Subsidiaries, or enter into any transaction of merger or
consolidation, or liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease or sub-lease (as lessor or
sublessor), transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired, or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person, except:
(i) any Domestic Subsidiary of Company may be merged with or
into Company or any wholly-owned Subsidiary Guarantor, or be
liquidated, wound up or dissolved, or all or any part of its business,
property or assets may be conveyed, sold, leased, transferred or
otherwise disposed of, in one transaction or a series of transactions,
to Company or any wholly-owned Subsidiary Guarantor; provided that, in
the case of such a merger, Company or such wholly-owned Subsidiary
Guarantor shall be the continuing or surviving corporation;
(ii) Company and its Subsidiaries may make Consolidated
Capital Expenditures permitted under subsection 7.8;
(iii) Company and its Subsidiaries may dispose of obsolete,
worn out or surplus property in the ordinary course of business;
(iv) Company and its Subsidiaries may sell or otherwise
dispose of assets in transactions that do not constitute Asset Sales;
provided that the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof;
(v) Acquisition Co. and Xxxxxx xxx consummate the Merger;
(vi) Company or any of its Subsidiaries may convey, sell,
transfer or otherwise dispose for Cash of any Margin Stock, whether now
owned or hereafter acquired; provided that such disposition is for fair
value and the proceeds are held in Cash or Cash Equivalents;
(vii) Company and its Subsidiaries may acquire, whether by
purchase, issuance of stock or other equity or debt securities, merger,
reorganization or any other method, any Person, substantially all of
the assets of any Person, or any division or line of business of any
Person (any such Person, assets, division or line of business being an
"Acquired Business" and any such acquisition permitted hereunder being
a "Permitted Acquisition"), provided that each of the following
conditions is satisfied:
(a) the Acquired Business is engaged in a line of
business that Company and its Subsidiaries are permitted to engage in
under subsection 7.13A;
(b) the Acquired Business becomes a wholly-owned
Subsidiary of Company or is acquired by a wholly-owned Subsidiary of
Company in such Permitted Acquisition;
(c) the aggregate amount of Cash consideration paid by
Company and its Subsidiaries for any Permitted Acquisition or series of
related Permitted Acquisitions made after the Closing Date shall not
exceed $20 million;
(d) the excess of the Revolving Loan Commitments over the
Total Utilization of Revolving Loan Commitments immediately after
giving effect to such Permitted Acquisition will be not less than $10
million;
(e) concurrently with the consummation of such Permitted
Acquisition, Company shall, and shall cause its Subsidiaries to, comply
with the requirements of subsections 6.8 and 6.9 with respect to such
Permitted Acquisition;
(f) prior to the consummation of any such Permitted
Acquisition having a purchase price in excess of $5 million, Company
shall deliver to Administrative Agent an Officers' Certificate (1)
certifying that no Potential Event of Default or Event of Default under
this Agreement shall then exist or shall occur as a result of such
Permitted Acquisition, (2) demonstrating that after giving effect to
such Permitted Acquisition and to all Indebtedness to be incurred or
assumed or repaid in connection with or as consideration for such
Permitted Acquisition, Company will be in compliance with the financial
covenants, calculated on a Pro Forma Basis, as of the last day of the
four Fiscal Quarter period most recently ended prior to the date of the
proposed Permitted Acquisition for which the relevant financial
information is available, (3) delivering a copy, prepared in conformity
with GAAP (subject to year-end adjustments and the absence of
footnotes), of (i) financial statements of the Person or business so
acquired for the immediately preceding four consecutive Fiscal Quarter
period corresponding to the calculation period for the financial
covenants in the immediately preceding clause and (ii) audited or
reviewed financial statements of the Person or business so acquired for
the fiscal year ended within such period of such Person, and (4)
revised financial projections (in a form substantially consistent with
previously provided projections) for Company pro forma for any proposed
Permitted Acquisition in excess of $5 million for the succeeding four
Fiscal Quarters; and
(g) the aggregate total amount of all Permitted
Acquisitions that result in a new Foreign Subsidiary of Company or
result in the Acquired Business being owned by a Foreign Subsidiary of
Company shall not exceed $5 million; and
(h) a Foreign Subsidiary acquired in a Permitted
Acquisition shall be directly owned by Company or one of its
wholly-owned Domestic Subsidiaries; and
(viii) Company and its Subsidiaries may make Asset Sales of
assets having a fair market value of not in excess of $5 million in any
Fiscal Year or of $15 million in the aggregate for all such Asset
Sales; provided that in each case (x) the consideration received for
such assets shall be in an amount at least equal to the fair market
value thereof; (y) 90% of the consideration received therefor shall be
Cash; and (z) the proceeds of any such Asset Sale are applied as
required by subsection 2.4B(iii)(a).
7.8 Consolidated Capital Expenditures
Company shall not, and shall not permit its Subsidiaries to, make or
incur Consolidated Capital Expenditures, in any Fiscal Year indicated below, in
an aggregate amount in excess of the corresponding amount (the "Maximum
Consolidated Capital Expenditures Amount") set forth below opposite such Fiscal
Year; provided that the Maximum Consolidated Capital Expenditures Amount for any
Fiscal Year shall be increased by an amount equal to the excess, if any, of the
Maximum Consolidated Capital Expenditures Amount for the previous Fiscal Year
(prior to any adjustment in accordance with this proviso) over the actual amount
of Consolidated Capital Expenditures for such previous Fiscal Year; provided,
further that in no event shall the amount of such increase exceed 50% of the
Maximum Consolidated Capital Expenditures Amount for such previous Fiscal Year
(prior to any adjustment in accordance with this proviso):
Fiscal Year Maximum Consolidated
Capital Expenditures
------------------------------------------------------------------------------
Fiscal Year 2000 $10.0 million
Fiscal Year 2001 $10.5 million
Fiscal Year 2002 $11.0 million
Fiscal Year 2003 $11.5 million
Fiscal Year 2004 $12.0 million
Fiscal Year 2005 $12.0 million
and thereafter
7.9 Sales and Lease-Backs
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, become or remain liable as lessee or as a guarantor or
other surety with respect to any lease, whether an Operating Lease or a Capital
Lease, of any property (whether real, personal or mixed), whether now owned or
hereafter acquired, (i) which Company or any of its Subsidiaries has sold or
transferred or is to sell or transfer to any other Person (other than Company or
any of its Subsidiaries) or (ii) which Company or any of its Subsidiaries
intends to use for substantially the same purpose as any other property which
has been or is to be sold or transferred by Company or any of its Subsidiaries
to any Person (other than Company or any of its Subsidiaries) in connection with
such lease; provided that Company may remain liable as lessee with respect to
the lease of the Company's principal executive offices located at 0000 Xxxxxxx
Xxxxxxxxxx Xxxxx, Xx. Xxxxx, Xxxxxxxx, and provided further that Company and its
Subsidiaries may become and remain liable as lessee, guarantor or other surety
with respect to any such lease to the extent that (i) such lease, if a Capital
Lease, is permitted pursuant to subsection 7.1(iii), (ii) the consideration
received is at least equal to the fair market value of the property sold as
determined in good faith by Company's Board of Directors and (iii) the Net Asset
Sale Proceeds derived from the sale/leaseback of such sold properties or assets
owned by the Company or its Subsidiaries shall be applied to prepay Loans and/or
reduce commitments pursuant to subsection 2.4B(iii)(a) without regard to any
reinvestment of such Net Asset Sale Proceeds otherwise permitted under such
subsection.
7.10 Sale or Discount of Receivables
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, sell with recourse, or discount or otherwise sell for
less than the face value thereof, any of its notes or accounts receivable.
7.11 Transactions with Stockholders and Affiliates
Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction (including
the purchase, sale, lease or exchange of any property or the rendering of any
service) with any holder of 5% or more of any class of equity Securities of
Company or with any Affiliate of Company or of any such holder, on terms that
are less favorable to Company or that Subsidiary, as the case may be, than those
that might be obtained at the time from Persons who are not such a holder or
Affiliate; provided that the foregoing restriction shall not apply to (i) any
transaction between Company and any of its wholly-owned Subsidiaries or between
any of its wholly-owned Subsidiaries, or (ii) reasonable and customary fees paid
to members of the Boards of Directors of Company and its Subsidiaries.
7.12 Disposal of Subsidiary Equity
Except pursuant to the Collateral Documents and except for any sale of
100% of the capital stock or other equity Securities of any its Subsidiaries in
compliance with the provisions of subsection 7.7(i) or 7.7(viii), Company shall
not:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of its Subsidiaries, except to qualify directors if
required by applicable law; or
(ii) permit any of its Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any shares of
capital stock or other equity Securities of any of its Subsidiaries
(including such Subsidiary), except to Company, a Domestic Subsidiary
of Company, or to qualify directors if required by applicable law.
Nothing in this subsection 7.12 shall prohibit (a) the sale,
assignment, transfer, conveyance or other disposition of any Margin Stock owned
by Company or any of its Subsidiaries for Cash at its fair value (as determined
in good faith by its Board of Directors) so long as proceeds are held as Cash or
Cash Equivalents or (b) the creation, incurrence, assumption or existence of any
Lien on or with respect to any Margin Stock; provided, however, that except with
respect to the shares of Shelby Common Stock tendered for purchase pursuant to
the Tender Offer, Company shall not, and shall not permit any of its
Subsidiaries to, take any action which will have the effect of causing any
shares of the capital stock of any Subsidiary of Company to constitute Margin
Stock.
7.13 Conduct of Business
A. From and after the Closing Date, Company shall not, and shall not
permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Company and its Subsidiaries on the Closing Date and
similar or related businesses and (ii) such other lines of business as may be
consented to by Requisite Lenders.
B. Company will not permit Acquisition Co. to engage in any activities
other than those that are necessary or advisable to effect the Tender Offer upon
the terms set forth in the Tender Offer Materials, to consummate the Merger, and
to effect the transaction contemplated by this Agreement.
7.14 Amendments or Waivers of Related Agreements
A. None of Company nor any of its Subsidiaries will agree to any
material amendment to, or waive any of its material rights under, any Related
Agreement, or terminate or agree to terminate any Related Agreement without in
each case obtaining the prior written consent of Requisite Lenders to such
amendment, waiver or termination.
B. Company shall not, and shall not permit any of its Subsidiaries to,
amend or otherwise change the terms of any Subordinated Indebtedness, or make
any payment consistent with an amendment thereof or change thereto, if the
effect of such amendment or change is to increase the interest rate on such
Subordinated Indebtedness, change (to earlier dates) any dates upon which
payments of principal or interest are due thereon, change any event of default
or condition to an event of default with respect thereto (other than to
eliminate any such event of default or increase any grace period related
thereto), change the redemption, prepayment or defeasance provisions thereof,
change the subordination provisions thereof (or of any guaranty thereof), or
change any collateral therefor (other than to release such collateral), or if
the effect of such amendment or change, together with all other amendments or
changes made, is to increase materially the obligations of the obligor
thereunder or to confer any additional rights on the holders of such
Subordinated Indebtedness (or a trustee or other representative on their behalf)
which would be adverse to Company or Lenders.
C. Company shall not, and shall not permit any of its Subsidiaries to,
designate any Indebtedness as "Designated Senior Debt" (as defined in the Senior
Subordinated Debt Indenture) for purposes of the Senior Subordinated Debt
Indenture without the prior written consent of Requisite Lenders.
7.15 Fiscal Year
Company shall not change its Fiscal Year-end from the Saturday closest
to October 31 of each calendar year.
Section 8. EVENTS OF DEFAULT
If any of the following conditions or events ("Events of Default")
shall occur:
8.1 Failure to Make Payments When Due
Failure by Company to pay any installment of principal of any Loan when
due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Company to pay when
due any amount payable to an Issuing Lender in reimbursement of any drawing
under a Letter of Credit; or failure by Company to pay any interest on any Loan
or any fee or any other amount due under this Agreement within five days after
the date due; or
8.2 Default in Other Agreements
(i) Failure of Company or any of its Subsidiaries to pay when
due any principal of or interest on or any other amount payable in
respect of one or more items of Indebtedness (other than Indebtedness
referred to in subsection 8.1) or Contingent Obligations in an
aggregate principal amount of $2 million or more beyond the end of any
grace period provided therefor; or
(ii) breach or default by Company or any of its Subsidiaries
with respect to any other material term of (a) one or more items of
Indebtedness or Contingent Obligations in the aggregate principal
amount referred to in clause (i) above or (b) any loan agreement,
mortgage, indenture or other agreement relating to such item(s) of
Indebtedness or Contingent Obligation(s), if the effect of such breach
or default is to cause, or to permit the holder or holders of that
Indebtedness or Contingent Obligation(s) (or a trustee on behalf of
such holder or holders) to cause, that Indebtedness or Contingent
Obligation(s) to become or be declared due and payable prior to its
stated maturity or the stated maturity of any underlying obligation, as
the case may be (upon the giving or receiving of notice, lapse of time,
both, or otherwise); or
8.3 Breach of Certain Covenants
Failure of Company to perform or comply with any term or condition
contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or
8.4 Breach of Warranty
Any representation, warranty, certification or other statement made by
Company or any of its Subsidiaries in any Loan Document or in any statement or
certificate at any time given by Company or any of its Subsidiaries in writing
pursuant hereto or thereto or in connection herewith or therewith shall be false
in any material respect on the date as of which made; or
8.5 Other Defaults Under Loan Documents
Any Loan Party shall default in the performance of or compliance with
any term contained in this Agreement or any of the other Loan Documents, other
than any such term referred to in any other subsection of this Section 8, and
such default shall not have been remedied or waived within thirty (30) days
after the earlier of (i) an officer of Company or such Loan Party becoming aware
of such default or (ii) receipt by Company and such Loan Party of notice from
Administrative Agent or any Lender of such default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
A court having jurisdiction in the premises shall enter a decree or
order for relief in respect of Company or any of its Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, which decree
or order is not stayed; or any other similar relief shall be granted under any
applicable federal or state law; or (ii) an involuntary case shall be commenced
against, Company or any of its Subsidiaries under the Bankruptcy Code or under
any other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Company or any of its Subsidiaries, or
over all or a substantial part of its property, shall have been entered; or
there shall have occurred the involuntary appointment of an interim receiver,
trustee or other custodian of Company or any of its Subsidiaries for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Company or any of its Subsidiaries, and any such event described in
this clause (ii) shall continue for 60 days unless dismissed, bonded or
discharged; or
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Company or any of its Subsidiaries shall have an order for
relief entered with respect to it or commence a voluntary case under
the Bankruptcy Code or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect, or shall consent
to the entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such
law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of
its property; or Company or any of its Subsidiaries shall make any
assignment for the benefit of creditors; or
(ii) Company or any of its Subsidiaries shall be unable, or
shall fail generally, or shall admit in writing its inability, to pay
its debts as such debts become due; or the Board of Directors of
Company or any of its Subsidiaries (or any committee thereof) shall
adopt any resolution or otherwise authorize any action to approve any
of the actions referred to in clause (i) above or this clause (ii); or
8.8 Judgments and Attachments
Any money judgment, writ or warrant of attachment or similar process
involving either in any individual case or in the aggregate at any time an
amount in excess of $2 million (in either case not adequately covered by
insurance as to which a solvent and unaffiliated insurance company has
acknowledged coverage) shall be entered or filed against Company or any of its
Subsidiaries or any of their respective assets and shall remain undischarged,
unvacated, unbonded or unstayed for a period of 60 days (or in any event later
than five days prior to the date of any proposed sale thereunder); or
8.9 Dissolution
Any order, judgment or decree shall be entered against, Company or any
of its Subsidiaries decreeing the dissolution or split up of Company or that
Subsidiary and such order shall remain undischarged or unstayed for a period in
excess of 30 days; or
8.10 Employee Benefit Plans
There shall occur one or more ERISA Events which individually or in the
aggregate results in or might reasonably be expected to result in liability of
Company, any of its Subsidiaries or any of their respective ERISA Affiliates in
excess of $1 million during the term of this Agreement; or there shall exist an
amount of liability calculated in accordance with the provisions of subsection
5.11D which exceeds $1 million; or
8.11 Change in Control
Any Change in Control shall occur; or
8.12 Invalidity of Guaranties; Failure of Security; Repudiation of Obligations
At any time after the execution and delivery thereof, (i) any Guaranty
for any reason, other than the satisfaction in full of all Obligations, shall
cease to be in full force and effect (other than in accordance with its terms)
or shall be declared to be null and void, (ii) any Collateral Document shall
cease to be in full force and effect (other than by reason of a release of
Collateral thereunder in accordance with the terms hereof or thereof, the
satisfaction in full of the Obligations or any other termination of such
Collateral Document in accordance with the terms hereof or thereof) or shall be
declared null and void, or Administrative Agent shall not have or shall cease to
have a valid and perfected First Priority Lien in any Collateral purported to be
covered thereby, in each case for any reason other than the failure of any Agent
or any Lender to take any action within its control, or (iii) any Loan Party
shall contest the validity or enforceability of any Loan Document in writing or
deny in writing that it has any further liability, including with respect to
future advances by Lenders, under any Loan Document to which it is a party; or
8.13 Mergers
The Merger shall be unwound, reversed or otherwise rescinded in whole
or in part for any reason or, prior to the Merger Date, any party to the Merger
Agreement shall take any action to terminate the Merger Agreement or abandon the
Merger or the Merger shall not occur on or prior to the 120th calendar day after
the Closing Date:
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans, (b) an amount equal to the maximum amount that may at any time be drawn
under all Letters of Credit then outstanding (whether or not any beneficiary
under any such Letter of Credit shall have presented, or shall be entitled at
such time to present, the drafts or other documents or certificates required to
draw under such Letter of Credit), and (c) all other Obligations shall
automatically become immediately due and payable, without presentment, demand,
protest or other requirements of any kind, all of which are hereby expressly
waived by Company, and the obligation of each Lender to make any Loan, the
obligation of Administrative Agent to issue any Letter of Credit and the right
of any Lender to issue any Letter of Credit hereunder shall thereupon terminate,
and (ii) upon the occurrence and during the continuation of any other Event of
Default, Administrative Agent shall, upon the written request or may, with the
written consent of Requisite Lenders, by written notice to Company, declare all
or any portion of the amounts described in clauses (a) through (c) above to be,
and the same shall forthwith become, immediately due and payable, and the
obligation of each Lender to make any Loan, the obligation of Administrative
Agent to issue any Letter of Credit and the right of any Lender to issue any
Letter of Credit hereunder shall thereupon terminate; provided that the
foregoing shall not affect in any way the obligations of Revolving Lenders under
subsection 3.3C(i) or the obligations of Revolving Lenders to purchase
participations in any unpaid Swing Line Loans as provided in subsection
2.1A(iii).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Collateral Account Agreement and shall be applied as provided
therein.
Notwithstanding anything contained in the second preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph Company shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Company, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended,
directly or indirectly, to benefit Company, and such provisions shall not at any
time be construed so as to grant Company the right to require Lenders to rescind
or annul any acceleration hereunder or to preclude Administrative Agent or
Lenders from exercising any of the rights or remedies available to them under
any of the Loan Documents, even if the conditions set forth in this paragraph
are met.
Section 9. THE AGENTS
9.1 Appointment
A. Appointment of Agents. DLJ is hereby appointed Administrative Agent
hereunder and under the other Loan Documents and each Lender hereby authorizes
Administrative Agent to act as its agent in accordance with the terms of this
Agreement and the other Loan Documents. First Union National Bank is hereby
appointed Syndication Agent hereunder and under the other Loan Documents and
each Lender hereby authorizes Syndication Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents.
NationsBank, N.A. is hereby appointed Documentation Agent hereunder and under
the other Loan Documents and each Lender hereby authorizes Documentation Agent
to act as its agent in accordance with the terms of this Agreement and the other
Loan Documents. Each of Administrative Agent, Syndication Agent and
Documentation Agent agrees to act upon the express conditions contained in this
Agreement and the other Loan Documents, as applicable. The provisions of this
Section 9 are solely for the benefit of each of Agents and Lenders and Company
shall have no rights as a third party beneficiary of any of the provisions
thereof. In performing its functions and duties under this Agreement, each of
Administrative Agent, Syndication Agent and Documentation Agent shall act solely
as an agent of Lenders and does not assume and shall not be deemed to have
assumed any obligation towards or relationship of agency or trust with or for
Company or any of its Subsidiaries.
B. Appointment of Supplemental Collateral Agents. It is the purpose of
this Agreement and the other Loan Documents that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement
or any of the other Loan Documents, and in particular in case of the enforcement
of any of the Loan Documents, or in case Administrative Agent deems that by
reason of any present or future law of any jurisdiction it may not exercise any
of the rights, powers or remedies granted herein or in any of the other Loan
Documents or take any other action which may be desirable or necessary in
connection therewith, it may be necessary that Administrative Agent appoint an
additional individual or institution as a separate trustee, co-trustee,
collateral agent or collateral co-agent (any such additional individual or
institution being referred to herein individually as a "Supplemental Collateral
Agent" and collectively as "Supplemental Collateral Agents").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent and all references therein to Administrative Agent shall be deemed to be
references to Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.
Should any instrument in writing from Company or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Company shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.2 Powers and Duties; General Immunity
X. Xxxxxx; Duties Specified. Each Lender irrevocably authorizes each
Agent to take such action on such Lender's behalf and to exercise such powers,
rights and remedies hereunder and under the other Loan Documents as are
specifically delegated or granted to such Agent by the terms hereof and thereof,
together with such powers, rights and remedies as are reasonably incidental
thereto. Each Agent shall have only those duties and responsibilities that are
expressly specified in this Agreement and the other Loan Documents. Each Agent
may exercise such powers, rights and remedies and perform such duties by or
through its agents or employees. No Agent shall have, by reason of this
Agreement or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender; and nothing in this Agreement or any of the other Loan
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon any Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
Notwithstanding anything herein to the contrary, Agent shall not be responsible
for notifying any Federal banking authority of its activities hereunder
(including pursuant to the Bank Service Company Act (12 U.S.C. 1867)).
B. No Responsibility for Certain Matters. No Agent shall be responsible
to any Lender for the execution, effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Agreement or any other
Loan Document or for any representations, warranties, recitals or statements
made herein or therein or made in any written or oral statements or in any
financial or other statements, instruments, reports or certificates or any other
documents furnished or made by such Agent to Lenders or by or on behalf of
Company to such Agent or any Lender in connection with the Loan Documents and
the transactions contemplated thereby or for the financial condition or business
affairs of Company or any other Person liable for the payment of any
Obligations, nor shall such Agent be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained in any of the Loan Documents or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or as to the existence
or possible existence of any Event of Default or Potential Event of Default.
Anything contained in this Agreement to the contrary notwithstanding,
Administrative Agent shall not have any liability arising from confirmations of
the amount of outstanding Loans or the Letter of Credit Usage or the component
amounts thereof.
C. Exculpatory Provisions. None of the Agents nor any of their
respective officers, directors, employees or agents shall be liable to Lenders
for any action taken or omitted by any such Agent under or in connection with
any of the Loan Documents except to the extent caused by such Agent's gross
negligence or willful misconduct. Each Agent shall be entitled to refrain from
any act or the taking of any action (including the failure to take an action) in
connection with this Agreement or any of the other Loan Documents or from the
exercise of any power, discretion or authority vested in it hereunder or
thereunder unless and until such Agent shall have received instructions in
respect thereof from Requisite Lenders (or such other Lenders as may be required
to give such instructions under subsection 10.6) and, upon receipt of such
instructions from Requisite Lenders (or such other Lenders, as the case may be),
such Agent shall be entitled to act or (where so instructed) refrain from
acting, or to exercise such power, discretion or authority, in accordance with
such instructions. Without prejudice to the generality of the foregoing, (i)
each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and
shall be entitled to rely and shall be protected in relying on opinions and
judgments of attorneys (who may be attorneys for Company and its Subsidiaries),
accountants, experts and other professional advisors selected by it; and (ii) no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or (where so instructed) refraining from acting under this
Agreement or any of the other Loan Documents in accordance with the instructions
of Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 10.6).
D. Agents Entitled to Act as Lender. The agency hereby created shall in
no way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder.
With respect to its participation in the Loans and the Letters of Credit, each
Agent shall have the same rights and powers hereunder as any other Lender and
may exercise the same as though it were not performing the duties and functions
delegated to it hereunder, and the term "Lender" or "Lenders" or any similar
term shall, unless the context clearly otherwise indicates, include such Agent
in its individual capacity. Any Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Company or any of its Affiliates as if
it were not performing the duties specified herein, and may accept fees and
other consideration from Company for services in connection with this Agreement
and otherwise without having to account for the same to Lenders.
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Company and
its Subsidiaries in connection with the making of the Loans and the issuance of
Letters of Credit hereunder and that it has made and shall continue to make its
own appraisal of the creditworthiness of Company and its Subsidiaries. No Agent
shall have any duty or responsibility, either initially or on a continuing
basis, to make any such investigation or any such appraisal on behalf of Lenders
or to provide any Lender with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter, and no Agent shall have any responsibility with
respect to the accuracy of or the completeness of any information provided to
Lenders.
9.4 Right to Indemnity
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify each Agent, to the extent that such Agent shall not have been
reimbursed by Company, for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
(including counsel fees and disbursements) or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against such
Agent in exercising its powers, rights and remedies or performing its duties
hereunder or under the other Loan Documents or otherwise in its capacity as
Administrative Agent, Syndication Agent or Documentation Agent, as the case may
be, in any way relating to or arising out of this Agreement or the other Loan
Documents; provided that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from any Agent's gross negligence or
willful misconduct. If any indemnity furnished to any 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.
9.5 Successor Agents and Swing Line Lender
A. Successor Agents. Each Agent may resign at any time by giving 30
days' prior written notice thereof to the other Agents, Lenders and Company, and
any Agent may be removed at any time with or without cause by an instrument or
concurrent instruments in writing delivered to Company and the Agents and signed
by Requisite Lenders. Upon any notice of resignation or removal of
Administrative Agent, Requisite Lenders shall have the right, upon five Business
Days' notice to Company, to appoint a successor Administrative Agent. If for any
reason Requisite Lenders cannot agree on a successor Administrative Agent, the
resigning Administrative Agent shall have the right to designate a successor
Administrative Agent, after consulting with Company. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, that successor Administrative Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Administrative Agent, and the retiring or removed Administrative Agent
shall be discharged from its duties and obligations under this Agreement. After
any retiring or removed Administrative Agent's resignation or removal hereunder
as Administrative Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement.
B. Successor Swing Line Lender. Any resignation or removal of
Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation or removal of DLJ or its successor as Swing Line Lender, and any
successor Administrative Agent appointed pursuant to subsection 9.5A shall, upon
its acceptance of such appointment, become the successor Swing Line Lender for
all purposes hereunder. In such event (i) Company shall prepay any outstanding
Swing Line Loans made by the retiring or removed Administrative Agent in its
capacity as Swing Line Lender, (ii) upon such prepayment, the retiring or
removed Administrative Agent and Swing Line Lender shall surrender the Swing
Line Note held by it to Company for cancellation, and (iii) Company shall issue
a new Swing Line Note to the successor Administrative Agent and Swing Line
Lender substantially in the form of Exhibit IV-C annexed hereto, in the
principal amount of the Swing Line Loan Commitment then in effect and with other
appropriate insertions.
9.6 Collateral Documents and Guaranties
A. Each Lender hereby further authorizes Administrative Agent, on
behalf of and for the benefit of Lenders, to enter into each Collateral Document
as secured party and to be the agent for and representative of Lenders under
each Guaranty, and each Lender agrees to be bound by the terms of each
Collateral Document and Guaranty; provided that Administrative Agent shall not
(i) enter into or consent to any material amendment, modification, termination
or waiver of any provision contained in any Collateral Document or Guaranty or
(ii) release any Collateral (except as otherwise expressly permitted or required
pursuant to the terms of this Agreement or the applicable Collateral Document),
in each case without the prior consent of Requisite Lenders (or, if required
pursuant to subsection 10.6, all Lenders); provided further, however, that,
without further written consent or authorization from Lenders, Administrative
Agent may execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets permitted by this Agreement or to which Requisite Lenders
have otherwise consented or (b) release any Subsidiary Guarantor from the
Subsidiary Guaranty if all of the equity Securities of such Subsidiary Guarantor
is sold to any Person (other than an Affiliate of Company) pursuant to a sale or
other disposition permitted hereunder or to which Requisite Lenders have
otherwise consented. Anything contained in any of the Loan Documents to the
contrary notwithstanding, Company, each Agent and each Lender hereby agree that
(X) no Lender shall have any right individually to realize upon any of the
Collateral under any Collateral Document or to enforce any Guaranty, it being
understood and agreed that all rights and remedies under the Collateral
Documents and the Guaranties may be exercised solely by Administrative Agent for
the benefit of Lenders in accordance with the terms thereof, and (Y) in the
event of a foreclosure by Administrative Agent on any of the Collateral pursuant
to a public or private sale, any Agent or any Lender may be the purchaser of any
or all of such Collateral at any such sale and Administrative Agent, as agent
for and representative of Lenders (but not any Lender or Lenders in its or their
respective individual capacities unless Requisite Lenders shall otherwise agree
in writing) shall be entitled, for the purpose of bidding and making settlement
or payment of the purchase price for all or any portion of the Collateral sold
at any such public sale, to use and apply any of the Obligations as a credit on
account of the purchase price for any collateral payable by Administrative Agent
at such sale.
B. Each Lender hereby authorizes Administrative Agent to execute any
and all powers of attorney or other instruments on behalf of such Lender
necessary to effect the pledge of any Subsidiary's shares of capital stock under
the laws of a jurisdiction outside of the United States of America.
Section 10. MISCELLANEOUS
10.1 Assignments and Participations in Loans and Letters of Credit
A. General. Subject to subsection 10.1B, each Lender shall have the
right at any time to (i) sell, assign or transfer to any Eligible Assignee, or
(ii) sell participations to any Person in, all or any part of its Commitments or
any Loan or Loans made by it or its Letters of Credit or participations therein
or any other interest herein or in any other Obligations owed to it; provided
that no such sale, assignment, transfer or participation shall, without the
consent of Company, require Company to file a registration statement with the
Securities and Exchange Commission or apply to qualify such sale, assignment,
transfer or participation under the securities laws of any state; provided
further that no such sale, assignment, transfer or participation of any Letter
of Credit or any participation therein may be made separately from a sale,
assignment, transfer or participation of a corresponding interest in the
Revolving Loan Commitment and the Revolving Loans of the Revolving Lender
effecting such sale, assignment, transfer or participation; and provided further
that, anything contained herein to the contrary notwithstanding, the Swing Line
Loan Commitment and the Swing Line Loans of Swing Line Lender may not be sold,
assigned or transferred as described in clause (i) above to any Person other
than a successor Administrative Agent and Swing Line Lender to the extent
contemplated by subsection 9.5. Except as otherwise provided in this subsection
10.1, no Lender shall, as between Company and such Lender, be relieved of any of
its obligations hereunder as a result of any sale, assignment or transfer of, or
any granting of participations in, all or any part of its Commitments or the
Loans, the Letters of Credit or participations therein, or the other Obligations
owed to such Lender.
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan,
Letter of Credit or participation therein, or other Obligation may (a)
be assigned in any amount to another Lender, or to an Affiliate or
Affiliated Fund of the assigning Lender or another Lender, with the
giving of notice to Company and Administrative Agent or (b) be assigned
in an aggregate amount of not less than $1 million (or such lesser
amount as shall constitute the aggregate amount of the Commitments,
Loans, Letters of Credit and participations therein, and other
Obligations of the assigning Lender or as may be consented to by
Company and Administrative Agent) to any other Eligible Assignee with
the consent of Company (which consent shall only be required if no
Potential Event of Default or Event of Default has occurred and is
continuing) and Administrative Agent (which consent of Company and
Administrative Agent shall not be unreasonably withheld or delayed). To
the extent of any such assignment in accordance with either clause (a)
or (b) above, the assigning Lender shall be relieved of its obligations
with respect to its Commitments, Loans, Letters of Credit or
participations therein, or other Obligations or the portion thereof so
assigned. The parties to each such assignment shall execute and deliver
to Administrative Agent, for its acceptance, an Assignment Agreement,
together with a processing fee of $1,000 (to be assessed only if the
assignee is not a Lender or an Affiliate or Affiliated Fund of a Lender
and otherwise at Administrative Agent's discretion) and such forms,
certificates or other evidence, if any, with respect to United States
federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a). Upon such execution, delivery and
acceptance from and after the effective date specified in such
Assignment Agreement, (y) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment Agreement, shall have
the rights and obligations of a Lender hereunder and (z) the assigning
Lender thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment
Agreement, relinquish its rights (other than any rights which survive
the termination of this Agreement under subsection 10.9B) and be
released from its obligations under this Agreement (and, in the case of
an Assignment Agreement covering all or the remaining portion of an
assigning Lender's rights and obligations under this Agreement, such
Lender shall cease to be a party hereto; provided that, anything
contained in any of the Loan Documents to the contrary notwithstanding,
if such Lender is the Issuing Lender with respect to any outstanding
Letters of Credit such Lender shall continue to have all rights and
obligations of an Issuing Lender with respect to such Letters of Credit
until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder). The Commitments
hereunder shall be modified to reflect the Commitment of such assignee
and any remaining Commitment of such assigning Lender and, if any such
assignment occurs after the issuance of the Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its applicable Notes to
Administrative Agent for cancellation, and thereupon new Notes shall be
issued to the assignee and to the assigning Lender, substantially in
the form of Exhibit IV-A, Exhibit IV-B or Exhibit IV-C annexed hereto,
as the case may be, with appropriate insertions, to reflect the new
Commitments and/or outstanding Term Loans, as the case may be, of the
assignee and the assigning Lender.
(ii) Acceptance by Administrative Agent. Upon its receipt of
an Assignment Agreement executed by an assigning Lender and an assignee
representing that it is an Eligible Assignee, together with any
processing fee required pursuant to subsection 10.1B(i) and any forms,
certificates or other evidence with respect to United States federal
income tax withholding matters that such assignee may be required to
deliver to Administrative Agent pursuant to subsection 2.7B(iii)(a),
Administrative Agent shall, if Administrative Agent and Company have
consented to the assignment evidenced thereby (in each case to the
extent such consent is required pursuant to subsection 10.1B(i)), (a)
accept such Assignment Agreement by executing a counterpart thereof as
provided therein (which acceptance shall evidence any required consent
of Administrative Agent to such assignment) and (b) give prompt notice
thereof to Company. Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in
this subsection 10.1B(ii).
C. Participations. The holder of any participation, other than an
Affiliate or Affiliated Fund of the Lender granting such participation, shall
not be entitled to require such Lender to take or omit to take any action
hereunder except action directly affecting (i) the extension of the scheduled
final maturity date of any Loan allocated to such participation or (ii) a
reduction of the principal amount of or the rate of interest payable on any Loan
allocated to such participation, and all amounts payable by Company hereunder
(including amounts payable to such Lender pursuant to subsections 2.6D, 2.7 and
3.6) shall be determined as if such Lender had not sold such participation.
Company and each Lender hereby acknowledge and agree that, solely for purposes
of subsections 10.3, 10.4 and 10.5, (a) any participation will give rise to a
direct obligation of Company to the participant and (b) the participant shall be
considered to be a "Lender".
D. Assignments to Federal Reserve Banks; Pledge by Funds. In addition
to the assignments and participations permitted under the foregoing provisions
of this subsection 10.1, any Lender may assign and pledge all or any portion of
its Loans, the other Obligations owed to such Lender, and its Notes to any
Federal Reserve Bank as collateral security pursuant to Regulation A of the
Board of Governors of the Federal Reserve System and any operating circular
issued by such Federal Reserve Bank; provided that (i) no Lender shall, as
between Company and such Lender, be relieved of any of its obligations hereunder
as a result of any such assignment and pledge and (ii) in no event shall such
Federal Reserve Bank be considered to be a "Lender" or be entitled to require
the assigning Lender to take or omit to take any action hereunder. Any Lender
which is an investment fund may pledge all or any portion of its Loans and Notes
to its trustee in support of such investment fund's fees, expenses and indemnity
obligations to such trustee; provided that no Lender shall, as between Company
and such Lender, be relieved of any of its obligations hereunder as a result of
any such pledge.
E. Information. Each Lender may furnish any information concerning any
Loan Party in the possession of that Lender from time to time to assignees and
participants (including prospective assignees and participants), subject to
subsection 10.19.
F. Representations of Lenders. Each Lender listed on the signature
pages hereof hereby represents and warrants (i) that it is an Eligible Assignee
described in clause (A) of the definition thereof; (ii) that it has experience
and expertise in the making of loans such as the Loans; and (iii) that it will
make its Loans for its own account in the ordinary course of its business and
without a view to distribution of such Loans within the meaning of the
Securities Act or the Exchange Act or other federal securities laws (it being
understood that, subject to the provisions of this subsection 10.1, the
disposition of such Loans or any interests therein shall at all times remain
within its exclusive control). Each Lender that becomes a party hereto pursuant
to an Assignment Agreement shall be deemed to agree that the representations and
warranties of such Lender contained in Section 2(c) of such Assignment Agreement
are incorporated herein by this reference.
10.2 Expenses
Whether or not the transactions contemplated hereby shall be
consummated, Company agrees to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto; (ii) all the costs of
furnishing all opinions by counsel for Company (including any opinions requested
by Administrative Agent or Lenders as to any legal matters arising hereunder)
and of Company's performance of and compliance with all agreements and
conditions on its part to be performed or complied with under this Agreement and
the other Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable fees,
expenses and disbursements of counsel to Arranger and Administrative Agent
(including allocated costs of internal counsel) in connection with the
negotiation, preparation, execution and administration of the Loan Documents and
any consents, amendments, waivers or other modifications thereto and any other
documents or matters requested by Company; (iv) all the actual costs and
reasonable expenses of creating and perfecting Liens in favor of Administrative
Agent on behalf of Lenders pursuant to any Collateral Document, including filing
and recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to Administrative Agent and of counsel providing any opinions that
Administrative Agent or Requisite Lenders may request in respect of the
Collateral Documents or the Liens created pursuant thereto; (v) all the actual
costs and reasonable expenses (including the reasonable fees, expenses and
disbursements of any auditors, accountants or appraisers and any environmental
or other consultants, advisors and agents employed or retained by Administrative
Agent or their respective counsel) of obtaining and reviewing any appraisals,
environmental audits or reports and any audits or reports provided for under
subsection 4.1I, 6.9B or 6.9C; (vi) the custody or preservation of any of the
Collateral; (vii) all other actual and reasonable costs and expenses incurred by
Arranger or Administrative Agent in connection with the syndication of the
Commitments and the negotiation, preparation and execution of the Loan Documents
and any consents, amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (viii) after the occurrence and during
the continuation of an Event of Default, all costs and expenses, including
reasonable attorneys' fees (including allocated costs of internal counsel) and
costs of settlement, incurred by Administrative Agent and Lenders in enforcing
any Obligations of or in collecting any payments due from any Loan Party
hereunder or under the other Loan Documents by reason of such Event of Default
(including in connection with the sale of, collection from, or other realization
upon any of the Collateral or the enforcement of the Guaranties or in connection
with any refinancing or restructuring of the credit arrangements provided under
this Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings).
10.3 Indemnity
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Company agrees to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless Arranger, Agents and Lenders, and the officers,
directors, trustees, employees, agents and affiliates of Arranger, Agents and
Lenders (collectively called the "Indemnitees"), from and against any and all
Indemnified Liabilities (as hereinafter defined); provided that Company shall
not have any obligation to any Indemnitee hereunder with respect to any
Indemnified Liabilities to the extent such Indemnified Liabilities arise solely
from the gross negligence or willful misconduct of that Indemnitee as determined
by a final judgment of a court of competent jurisdiction.
As used herein, "Indemnified Liabilities" means, collectively, any and
all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including Environmental
Claims), costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including Lenders' agreement to
make the Loans hereunder or the use or intended use of the proceeds thereof or
the issuance of Letters of Credit hereunder or the use or intended use of any
thereof), or any enforcement of any of the Loan Documents (including any sale
of, collection from, or other realization upon any of the Collateral or the
enforcement of the Guaranties), (ii) the statements contained in the commitment
letter delivered by any Lender to Company with respect thereto, or (iii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of Company or any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this subsection 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, Company shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 Set-Off; Security Interest in Deposit Accounts
In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence and during
the continuation of any Event of Default each Lender is hereby authorized by
Company at any time or from time to time, without notice to Company or to any
other Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits (general or special, including
Indebtedness evidenced by certificates of deposit, whether matured or unmatured,
but not including trust accounts) and any other Indebtedness at any time held or
owing by that Lender to or for the credit or the account of Company against and
on account of the obligations and liabilities of Company to that Lender under
this Agreement, the Letters of Credit and participations therein and the other
Loan Documents, including all claims of any nature or description arising out of
or connected with this Agreement, the Letters of Credit and participations
therein or any other Loan Document, irrespective of whether or not (i) that
Lender shall have made any demand hereunder or (ii) the principal of or the
interest on the Loans or any amounts in respect of the Letters of Credit or any
other amounts due hereunder shall have become due and payable pursuant to
Section 8 and although said obligations and liabilities, or any of them, may be
contingent or unmatured. Company hereby further grants to each Agent and each
Lender a security interest in all deposits and accounts maintained with such
Agent or such Lender as security for the Obligations.
10.5 Ratable Sharing
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) which is greater than the proportion received by
any other Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them; provided that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered from
such Lender upon the bankruptcy or reorganization of Company or otherwise, those
purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to such purchasing Lender ratably to the extent
of such recovery, but without interest. Company expressly consents to the
foregoing arrangement and agrees that any holder of a participation so purchased
may exercise any and all rights of banker's lien, set-off or counterclaim with
respect to any and all monies owing by Company to that holder with respect
thereto as fully as if that holder were owed the amount of the participation
held by that holder.
10.6 Amendments and Waivers
A. No amendment, modification, termination or waiver of any provision
of this Agreement or of the Notes, and no consent to any departure by Company
therefrom, shall in any event be effective without the written concurrence of
Requisite Lenders; provided that any amendment, modification, termination,
waiver or consent which:
(a) extends the final scheduled maturity of any Loan or
Note, or extends the stated maturity of any Letter of Credit beyond the
Revolving Loan Commitment Termination Date, or reduces the rate or
extends the time of payment of interest or fees thereon (except in
connection with a waiver of applicability of any post-default increase
in interest rates), or reduces the principal amount thereof (except to
the extent repaid in cash), or increases the amount or extends the
expiration date of any Lender's Commitments; or
(b) releases all or substantially all of (x) the
Collateral (except as expressly provided in the Loan Documents) under
all the Collateral Documents (it being understood that an increase in
the amount of Indebtedness of the Company secured ratably by the
Collateral shall not be deemed a release of Collateral), or (y) the
Guarantors (except as expressly provided in the Loan Documents) from
their obligations under any of the Guaranties; or
(c) amends, modifies or waives any provision of this
subsection 10.6; or
(d) reduces the percentage specified in the definition
"Requisite Lenders" (it being understood that, with the consent of
Requisite Lenders, additional extensions of credit pursuant to this
Agreement may be included in the determination of Requisite Lenders on
substantially the same basis as the extensions of Term Loans and
Revolving Loan Commitments are included on the Closing Date); or
(e) consents to the assignment or transfer by Company of
any of its rights and obligations under this Agreement or any other
Loan Document;
shall be effective only if evidenced in a writing signed by or on behalf of all
Lenders (with Obligations being directly affected in the case of clause (a)
above).
In addition, (i) no amendment, modification, termination or waiver of
any provision of any Note held by a Lender or which increases the Commitments of
any Lender over the amount thereof then in effect shall be effective without the
written concurrence of such Lender, (ii) no amendment, modification, termination
or waiver of any provision of subsection 2.1A(iii) or any other provision of
this Agreement relating to the Swing Line Lender shall be effective without the
written concurrence of Swing Line Lender, and (iii) no amendment, modification,
termination or waiver of any provision of Section 9 or of any other provision of
this Agreement which, by its terms, expressly requires the approval or
concurrence of Administrative Agent shall be effective without the written
concurrence of Administrative Agent.
B. If, in connection with any proposed amendment, modification,
termination or waiver of any of the provisions of this Agreement or the Notes
which requires the consent of all Lenders, the consent of Requisite Lenders is
obtained but the consent of one or more of such other Lenders whose consent is
required is not obtained, then Company shall have the right, so long as all
non-consenting Lenders whose individual consent is required are treated as
described in either clause (i) or (ii) below, to either (i) replace each such
non-consenting Lender or Lenders with one or more Replacement Lenders pursuant
to subsection 2.8 so long as at the time of such replacement, each such
Replacement Lender consents to the proposed amendment, modification, termination
or waiver, or (ii) terminate such non-consenting Lender's Commitments and repay
in full its outstanding Loans in accordance with subsections 2.4B(i)(b) and
2.4B(ii)(b); provided that unless the Commitments that are terminated and the
Loans that are repaid pursuant to the preceding clause (ii) are immediately
replaced in full at such time through the addition of new Lenders or the
increase of the Commitments and/or outstanding Loans of existing Lenders (who in
each case must specifically consent thereto), then in the case of any action
pursuant to the preceding clause (ii), the Requisite Lenders (determined before
giving effect to the proposed action) shall specifically consent thereto;
provided further that Company shall not have the right to terminate such
non-consenting Lender's Commitment and repay in full its outstanding Loans
pursuant to clause (ii) of this subsection 10.6B if, immediately after the
termination of such Lender's Revolving Loan Commitment in accordance with
subsection 2.4B(ii)(b), the Revolving Loan Exposure of all Lenders would exceed
the Revolving Loan Commitments of all Lenders; provided still further that
Company shall not have the right to replace a Lender solely as a result of the
exercise of such Lender's rights (and the withholding of any required consent by
such Lender) pursuant to the second paragraph of subsection 10.6A.
C. Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was given. No
notice to or demand on Company in any case shall entitle Company to any other or
further notice or demand in similar or other circumstances. Any amendment,
modification, termination, waiver or consent effected in accordance with this
subsection 10.6 shall be binding upon each Lender at the time outstanding, each
future Lender and, if signed by Company, on Company.
10.7 Independence of Covenants
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 Notices
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed; provided that notices to Administrative Agent shall not
be effective until received. For the purposes hereof, the address of each party
hereto shall be as set forth under such party's name on the signature pages
hereof or (i) as to Company and Administrative Agent, such other address as
shall be designated by such Person in a written notice delivered to the other
parties hereto and (ii) as to each other party, such other address as shall be
designated by such party in a written notice delivered to Administrative Agent.
10.9 Survival of Representations, Warranties and Agreements
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Company set forth in subsections 2.6D, 2.7, 3.5A,
3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections
9.2C, 9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative
No failure or delay on the part of any Agent or any Lender in the
exercise of any power, right or privilege hereunder or under any other Loan
Document shall impair such power, right or privilege or be construed to be a
waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside
None of Agents or Lenders shall be under any obligation to marshal any
assets in favor of Company or any other party or against or in payment of any or
all of the Obligations. To the extent that Company makes a payment or payments
to Administrative Agent or Lenders (or to Administrative Agent for the benefit
of Lenders), or any of Agents or Lenders enforce any security interests or
exercise their rights of setoff, and such payment or payments or the proceeds of
such enforcement or setoff or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, any
other state or federal law, common law or any equitable cause, then, to the
extent of such recovery, the obligation or part thereof originally intended to
be satisfied, and all Liens, rights and remedies therefor or related thereto,
shall be revived and continued in full force and effect as if such payment or
payments had not been made or such enforcement or setoff had not occurred.
10.12 Severability
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders' Rights
The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights arising out of this Agreement and it shall not be necessary for any other
Lender to be joined as an additional party in any proceeding for such purpose.
10.14 Headings
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 Applicable Law
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
10.16 Successors and Assigns
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the parties
hereto and the successors and assigns of Lenders (it being understood that
Lenders' rights of assignment are subject to subsection 10.1). Neither Company's
rights or obligations hereunder nor any interest therein may be assigned or
delegated by Company without the prior written consent of all Lenders.
10.17 Consent to Jurisdiction and Service of Process
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING AND
DELIVERING THIS AGREEMENT, COMPANY, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO COMPANY AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SUBSECTION 10.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER COMPANY IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST
COMPANY IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO
THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
10.18 Waiver of Jury Trial
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each party hereto acknowledges that this waiver is a material
inducement to enter into a business relationship, that each has already relied
on this waiver in entering into this Agreement, and that each will continue to
rely on this waiver in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
10.19 Confidentiality
Each Lender shall hold all non-public information obtained pursuant to
the requirements of this Agreement which has been identified as confidential by
Company in accordance with such Lender's customary procedures for handling
confidential information of this nature and in accordance with safe and sound
banking practices, it being understood and agreed by Company that in any event a
Lender may make disclosures to Affiliates and professional advisors of such
Lender or disclosures reasonably required by (a) any bona fide assignee,
transferee or participant in connection with the contemplated assignment or
transfer by such Lender of any Loans or any participations therein or (b) by any
direct or indirect contractual counterparties in swap agreements or such
contractual counterparties' professional advisors provided that such contractual
counterparty or professional advisor to such contractual counterparty agrees to
keep such information confidential to the same extent required of the Lenders
hereunder, or disclosures required or requested by any governmental agency or
representative thereof or pursuant to legal process; provided that, unless
specifically prohibited by applicable law or court order, each Lender shall
notify Company of any request by any governmental agency or representative
thereof (other than any such request in connection with any examination of the
financial condition of such Lender by such governmental agency) for disclosure
of any such non-public information prior to disclosure of such information; and
provided further that in no event shall Administrative Agent or any Lender be
obligated or required to return any materials furnished by Company or any of its
Subsidiaries.
10.20 Counterparts; Effectiveness
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Company and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
COMPANY: FALCON PRODUCTS, INC.
By:
------------------------------------
Name:
Title:
Notice Address:
0000 Xxxxxxx Xxxxxxxxxx Xxxxx
Xx. Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
LENDERS:
DLJ CAPITAL FUNDING, INC.,
individually and as
Administrative Agent
By:
-----------------------------------
Name:
Title:
Notice Address:
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
FIRST UNION NATIONAL BANK,
individually and as Syndication Agent
By:
-----------------------------------
Name:
Title:
Notice Address:
000 Xxxxx Xxxxxxx Xxxxxx
One First Union Center NC 0737
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X.X. Xxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
NATIONSBANK, N.A., individually and
as Documentation Agent
By:
-----------------------------------
Name:
Title:
Notice Address:
000 Xxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
THE BANK OF NOVA SCOTIA,
By:
-----------------------------------
Name:
Title:
Notice Address:
000 Xxxxxxxxx Xxxxxx X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
COMERICA BANK,
By:
----------------------------------
Name:
Title:
Notice Address:
One Detroit Center
500 Xxxxxxxx Avenue-Mail Code 3289
Xxxxxxx, XX 00000
Attention: Xxxx Xxxx
Tel.: 000-000-0000
Fax: 000-000-0000
THE FIRST NATIONAL BANK OF CHICAGO,
By:
-----------------------------------
Name:
Title:
Notice Address:
0 Xxxxx Xxxxxxxx Xxxxx
00xx Xxxxx
Xxxxxxx, XX 00000-0000
Attention: Xxxxxxxxxxx Xxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
XXXXXX TRUST & SAVINGS BANK,
By:
-----------------------------------
Name:
Title:
Notice Address:
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxx Xxxx
Tel.: 000-000-0000
Fax: 000-000-0000
XXXXXX FINANCIAL, INC.,
By:
----------------------------------
Name:
Title:
Notice Address:
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
MERCANTILE BANK,
By:
----------------------------------
Name:
Title:
Notice Address:
One Mercantile Center
000 Xxxxxx-xxxx 00-0
Xx. Xxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
NATIONAL CITY BANK,
By:
----------------------------------
Name:
Title:
Notice Address:
0000 Xxxx 0xx Xx.
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
THE NORTHERN TRUST COMPANY,
By:
----------------------------------
Name:
Title:
Notice Address:
00 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxx XxXxxxxxx
Tel.: 000-000-0000
Fax: 312-
PROVIDENT BANK,
By:
----------------------------------
Name:
Title:
Notice Address:
Xxx Xxxx Xxxxxx Xxxxxx
Corporate Finance Group-M.S.
216A
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
CREDIT AGRICOLE INDOSUEZ
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
Notice Address:
00 Xxxxxx Xxxxxx
47th Floor-Suite 4700
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
THE FUJI BANK, LIMITED
By:
----------------------------------
Name:
Title:
Notice Address:
000 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Tel.: 000-000-0000
Fax: 000-000-0000
