1
Exhibit 10.8
[CONFORMED COPY]
444444444444444444444444444444444444444
COMMONWEALTH ALUMINUM CORPORATION,
COMMONWEALTH INDUSTRIES, INC.,
COMMONWEALTH ALUMINUM LEWISPORT, INC.,
ALFLEX CORPORATION
and
BARMET ALUMINUM CORPORATION
-----------------------------
$325,000,000
-----------------------------
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of November 29, 1996
-----------------------------
NATIONAL WESTMINSTER BANK PLC,
as Administrative Agent
444444444444444444444444444444444444444
2
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is attached
but is inserted for convenience of reference only.
Page
----
Section 1. Definitions and Accounting Matters........................... 2
1.01 Certain Defined Terms........................................... 2
1.02 Accounting Terms and Determinations............................. 40
1.03 Types of Loans.................................................. 41
Section 2. Commitments, Loans, Notes and Prepayments.................... 41
2.01 Loans........................................................... 41
2.02 Borrowings...................................................... 44
2.03 Letters of Credit............................................... 45
2.04 Changes of Commitments.......................................... 51
2.05 Certain Fees.................................................... 51
2.06 Lending Offices................................................. 52
2.07 Several Obligations; Remedies Independent....................... 52
2.08 Notes........................................................... 52
2.09 Optional Prepayments and Conversions or
Continuations of Loans.......................................... 53
2.10 Mandatory Prepayments and Reductions of
Commitments..................................................... 54
2.11 Reserved Commitments, Etc....................................... 58
Section 3. Payments of Principal and Interest........................... 59
3.01 Repayment of Loans.............................................. 59
3.02 Interest........................................................ 60
Section 4. Payments; Pro Rata Treatment; Computations; Etc.............. 61
4.01 Payments........................................................ 61
4.02 Pro Rata Treatment.............................................. 62
4.03 Computations.................................................... 63
4.04 Minimum Amounts................................................. 63
4.05 Certain Notices................................................. 64
4.06 Non-Receipt of Funds by the Administrative Agent................ 65
4.07 Sharing of Payments, Etc........................................ 66
(1)
3
Page
----
Section 5. Yield Protection, Etc........................................ 68
5.01 Additional Costs................................................ 68
5.02 Limitation on Types of Loans.................................... 70
5.03 Illegality...................................................... 70
5.04 Treatment of Affected Loans..................................... 71
5.05 Compensation.................................................... 72
5.06 Additional Costs in Respect of Letters of Credit................ 73
5.07 U.S. Taxes...................................................... 73
5.08 Replacement of Lenders.......................................... 75
Section 6. Guarantee.................................................... 76
6.01 The Guarantee................................................... 76
6.02 Obligations Unconditional....................................... 77
6.03 Reinstatement................................................... 78
6.04 Subrogation..................................................... 79
6.05 Remedies........................................................ 79
6.06 Continuing Guarantee............................................ 79
6.07 Rights of Contribution.......................................... 79
6.08 Limitation on Guarantee Obligations............................. 81
Section 7. Conditions Precedent......................................... 81
7.01 Initial Loans................................................... 81
7.02 Conditions to Effectiveness..................................... 81
7.03 Initial and Subsequent Extensions of Credit..................... 84
7.04 Certain Determinations.......................................... 85
Section 8. Representations and Warranties............................... 85
8.01 Corporate Existence............................................. 85
8.02 Financial Condition............................................. 85
8.03 Litigation...................................................... 87
8.04 No Breach....................................................... 87
8.05 Action.......................................................... 87
8.06 Approvals....................................................... 87
8.07 Use of Credit................................................... 88
8.08 ERISA........................................................... 88
8.09 Taxes........................................................... 88
8.10 Investment Company Act.......................................... 89
8.11 Public Utility Holding Company Act.............................. 89
8.12 Material Agreements and Liens................................... 89
8.13 Environmental Matters........................................... 89
(2)
4
Page
----
8.14 Capitalization.................................................. 92
8.15 Subsidiaries, Etc............................................... 93
8.16 Title to Assets................................................. 94
8.17 True and Complete Disclosure.................................... 94
8.18 Real Property................................................... 95
8.19 Security Documents.............................................. 95
Section 9. Covenants of the Obligors.................................... 95
9.01 Financial Statements, Etc....................................... 95
9.02 Litigation...................................................... 100
9.03 Existence, Etc.................................................. 100
9.04 Insurance....................................................... 101
9.05 Prohibition of Fundamental Changes.............................. 104
9.06 Limitation on Liens............................................. 106
9.07 Indebtedness.................................................... 107
9.08 Investments..................................................... 108
9.09 Dividend Payments............................................... 109
9.10 Certain Financial Covenants..................................... 111
9.11 Capital Expenditures............................................ 117
9.12 Interest Rate Protection Agreements............................. 117
9.13 Subordinated Indebtedness....................................... 117
9.14 Lines of Business............................................... 118
9.15 Transactions with Affiliates.................................... 118
9.16 Use of Proceeds................................................. 118
9.17 Certain Obligations Respecting Subsidiaries..................... 119
9.18 Modifications of Certain Documents.............................. 120
9.19 Commodity Hedging Activities.................................... 120
9.20 After-Acquired Real Estate...................................... 120
9.21 Activities of the Parent and Holdings. ......................... 121
Section 10. Events of Default........................................... 121
Section 11. The Administrative Agent.................................... 126
11.01 Appointment, Powers and Immunities............................. 126
11.02 Reliance by Administrative Agent............................... 127
11.03 Defaults....................................................... 127
11.04 Rights as a Lender............................................. 128
11.05 Indemnification................................................ 128
11.06 Non-Reliance on Administrative Agent and Other
Lenders........................................................ 128
5
Page
----
11.07 Failure to Act................................................. 129
11.08 Resignation or Removal of Administrative Agent................. 129
11.09 Consents under Other Credit Documents.......................... 130
11.10 Collateral Sub-Agents.......................................... 130
Section 12. Miscellaneous............................................... 131
12.01 Waiver......................................................... 131
12.02 Notices........................................................ 131
12.03 Expenses, Etc.................................................. 131
12.04 Amendments, Etc................................................ 133
12.05 Successors and Assigns......................................... 134
12.06 Assignments and Participations................................. 134
12.07 Survival....................................................... 137
12.08 Captions....................................................... 137
12.09 Counterparts................................................... 137
12.10 Governing Law; Submission to Jurisdiction...................... 137
12.11 Waiver of Jury Trial........................................... 138
12.12 Treatment of Certain Information;
Confidentiality................................................ 138
(4)
6
SCHEDULES
---------
SCHEDULE I - Lenders and Commitments
SCHEDULE II - Litigation
SCHEDULE III - Conflicts
SCHEDULE IV - Governmental Approvals, Etc.
SCHEDULE V - Material Agreement and Liens
SCHEDULE VI - Certain Environmental Matters
SCHEDULE VII - Capitalization and Equity Rights relating to the Parent
SCHEDULE VIII - Capitalization and Equity Rights relating to Holdings
SCHEDULE IX - Capitalization and Equity Rights relating to CALI
SCHEDULE X - Capitalization and Equity Rights relating to Alflex
SCHEDULE XI - Capitalization and Equity Rights relating to Barmet
SCHEDULE XII - Subsidiaries and Investments
SCHEDULE XIII - Title to Properties
SCHEDULE XIV - Real Estate
SCHEDULE XV - Conditions Precedent to Original Credit Agreement
EXHIBITS
--------
EXHIBIT A-1 - Form of Term Loan Note
EXHIBIT A-2 - Form of Revolving Credit Note
EXHIBIT A-3 - Form of Swingline Note
EXHIBIT B - Form of Borrowing Base Certificate
EXHIBIT C - Form of Pledge and Security Agreement
EXHIBIT D - Form of Confidentiality Agreement
(5)
7
AMENDED AND RESTATED CREDIT AGREEMENT (this "AGREEMENT") dated as of
November 29, 1996, between:
(1) COMMONWEALTH ALUMINUM CORPORATION, a corporation duly organized
and validly existing under the laws of the State of Delaware (the
"PARENT");
(2) COMMONWEALTH INDUSTRIES, INC., a corporation duly organized and
validly existing under the laws of the State of Delaware ("HOLDINGS");
(3) COMMONWEALTH ALUMINUM LEWISPORT, INC., a corporation duly
organized and validly existing under the laws of the State of Delaware
("CALI");
(4) ALFLEX CORPORATION (formerly named CasTech Aluminum Group Inc.), a
corporation duly organized and validly existing under the laws of the State
of Delaware ("ALFLEX");
(5) BARMET ALUMINUM CORPORATION, a corporation duly organized and
validly existing under the laws of the State of Ohio ("BARMET");
(6) each of the Subsidiaries of the Parent identified under the
caption "SUBSIDIARY GUARANTORS" on the signature pages hereto and each
Subsidiary of the Parent that becomes a "Subsidiary Guarantor" after the
date hereof pursuant to Section 9.17(a) hereof (each, a "SUBSIDIARY
GUARANTOR" and, collectively, the "SUBSIDIARY GUARANTORS");
(7) each of the lenders that is a signatory hereto identified under
the caption "LENDERS" on the signature pages hereto and each lender that
becomes a "Lender" after the date hereof pursuant to Section 12.06(b)
hereof (individually, a "LENDER" and, collectively, the "LENDERS"); and
(8) NATIONAL WESTMINSTER BANK PLC, as administrative agent for the
Lenders (in such capacity, together with its successors in such capacity,
the "ADMINISTRATIVE AGENT").
Credit Agreement
----------------
8
-2-
PRELIMINARY STATEMENTS:
Terms used in these Preliminary Statements and not otherwise defined shall
have the meanings assigned to such terms in Section 1.01 of this Agreement.
(1) The Obligors, the Existing Lenders and the Administrative Agent are
parties to a Credit Agreement dated as of September 20, 1996 (as heretofore
modified and supplemented and in effect on the date of this Agreement, the
"ORIGINAL CREDIT AGREEMENT") providing, subject to the terms and conditions
thereof, for the making of revolving extensions of credit and term loans to the
Borrowers. The parties hereto now wish to amend the Original Credit Agreement in
certain respects and to add the New Lenders as parties thereto and, in that
connection, wish to amend and restate the Original Credit Agreement in its
entirety, it being the intention of the parties hereto that the loans
outstanding under the Original Credit Agreement on the Restatement Effective
Date shall continue and remain outstanding and not be repaid on the Restatement
Effective Date, but shall be assigned and reallocated among the Lenders as
provided in Section 2.01 hereof.
(2) Each of the Obligors expects to derive benefit, directly or indirectly,
from the credit extended to the Borrowers hereunder, both in its separate
capacity and as a member of the Commonwealth Group, since the successful
operation of each of such Obligors will be dependent on the continued successful
performance of the functions of such Commonwealth Group as a whole.
Accordingly, the parties hereto hereby agree that the Original Credit
Agreement shall, as of the date hereof (but subject to the satisfaction of the
conditions precedent specified in Section 7.02 hereof), be amended and restated
in its entirety as follows:
Credit Agreement
----------------
9
-3-
Section 1. DEFINITIONS AND ACCOUNTING MATTERS.
1.01 CERTAIN DEFINED TERMS. As used herein, the following terms shall have
the following meanings (all terms defined in this Section 1.01 or in other
provisions of this Agreement in the singular to have the correlative meanings
when used in the plural and vice versa):
"ACQUISITION" shall mean (a) the purchase by the Parent (either directly or
indirectly) of the Old CasTech Shares for cash pursuant to the Tender Offer
Documents, (b) the Merger and (c) the purchase of options in respect of the Old
CasTech Shares as contemplated by the Merger Agreement.
"ACQUISITION DOCUMENTS" shall mean the Tender Offer Documents, the Merger
Agreement, the certificate of merger with respect to the Merger and any other
document or information sent by the Parent or Old CasTech to the stockholders of
Old CasTech or filed with the Commission in connection with the Acquisition.
"ADMINISTRATIVE AGENT" shall have the meaning assigned to such term in the
recital of parties to this Agreement.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an administrative questionnaire
in a form supplied by the Administrative Agent.
"AFFILIATE" shall mean any Person directly or indirectly controlling,
directly or indirectly controlled by or under direct or indirect common control
with the Parent. As used in this definition, "CONTROL" (including, with its
correlative meanings, "CONTROLLING", "CONTROLLED BY" and "UNDER COMMON CONTROL
WITH") shall mean possession, directly or indirectly, of power to direct or
cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise), PROVIDED that, in any event, any Person that owns directly or
indirectly securities
Credit Agreement
----------------
10
-4-
having 10% or more of the voting power for the election of directors or other
governing body of a corporation or 10% or more of the partnership or other
ownership interests of any other Person (other than as a limited partner of such
other Person) will be deemed to control such corporation or other Person.
Notwithstanding the foregoing, (a) no individual shall be an Affiliate solely by
reason of his or her being a director, officer or employee of the Parent or any
of its Subsidiaries and (b) none of the Wholly Owned Subsidiaries of the Parent
shall be Affiliates.
"ALFLEX" shall have the meaning assigned to such term in the recital of
parties to this Agreement.
"ALUMINUM BUSINESS" shall mean the business of developing, manufacturing,
producing, marketing, transporting and selling aluminum, aluminum products and
electrical wiring products (including, without limitation, flexible conduit and
pre-wired armored cable) and any other business incidental thereto.
"APPLICABLE LENDING OFFICE" shall mean, for each Lender and for each Type
of Loan, the lending office of such Lender (or of an affiliate of such Lender)
designated for such Type of Loan in the Administrative Questionnaire of such
Lender or such other lending office of such Lender (or of an affiliate of such
Lender) as such Lender may from time to time specify to the Administrative Agent
and the Parent as the office by which its Loans of such Type are to be made and
maintained.
"APPLICABLE LETTER OF CREDIT PERCENTAGE" shall mean, at any time, the
Applicable Margin in effect at such time with respect to Term Loans that are
Eurodollar Loans.
"APPLICABLE MARGIN" shall mean, at any time, for each Type of Loans set
forth below, the percentage set forth below such Type opposite the Applicable
Pricing Level in effect at such time:
Credit Agreement
----------------
11
-5-
===========================================================================
APPLICABLE
PRICING LEVEL BASE RATE LOANS EURODOLLAR LOANS
---------------------------------------------------------------------------
1 0.00% 0.50%
---------------------------------------------------------------------------
2 0.00% 0.75%
---------------------------------------------------------------------------
3 0.00% 1.00%
---------------------------------------------------------------------------
4 0.00% 1.25%
---------------------------------------------------------------------------
5 0.25% 1.50%
---------------------------------------------------------------------------
6 0.50% 1.75%
---------------------------------------------------------------------------
7 0.75% 2.00%
---------------------------------------------------------------------------
8 1.00% 2.25%
===========================================================================
The Applicable Margin for Swingline Loans at any time shall be the Applicable
Margin in effect for Revolving Credit Loans that are Base Rate Loans at such
time.
"APPLICABLE NON-UTILIZATION FEE PERCENTAGE" shall mean, at any time, the
percentage set forth in the schedule below opposite the Applicable Pricing Level
in effect at such time:
Credit Agreement
----------------
12
-6-
===========================================================================
APPLICABLE APPLICABLE NON-UTILIZATION
PRICING LEVEL FEE PERCENTAGE
---------------------------------------------------------------------------
1 0.175%
---------------------------------------------------------------------------
2 0.200%
---------------------------------------------------------------------------
3 0.250%
---------------------------------------------------------------------------
4 0.250%
---------------------------------------------------------------------------
5 0.375%
---------------------------------------------------------------------------
6 0.375%
---------------------------------------------------------------------------
7 0.375%
---------------------------------------------------------------------------
8 0.500%
===========================================================================
The "APPLICABLE PRICING LEVEL" in effect at any time shall be deemed to be
the level specified in the schedule below opposite the Senior Indebtedness to
EBITDA Ratio in effect as at the close of business on the Original Closing Date
(PROVIDED that if the Senior Indebtedness to EBITDA Ratio as at the last day of
any fiscal quarter of the Parent ending on or after September 30, 1996 shall
fall within any of the ranges set forth in the schedule below then, subject to
the delivery to the Administrative Agent of a certificate of a Responsible
Officer of the Parent demonstrating such fact prior to the end of the next
succeeding fiscal quarter, the Applicable Pricing Level shall be changed to the
Applicable Pricing Level set forth opposite such range in such schedule during
the period commencing on the Quarterly Date on or immediately following the date
of receipt of such certificate to but not including the next succeeding
Quarterly Date thereafter):
Credit Agreement
----------------
13
-7-
===========================================================================
APPLICABLE
PRICING LEVEL SENIOR INDEBTEDNESS TO EBITDA RATIO
---------------------------------------------------------------------------
1 Less than 1.00 to 1.00
---------------------------------------------------------------------------
2 Greater than or equal to 1.00 to 1.00
and less than 2.00 to 1.00
---------------------------------------------------------------------------
3 Greater than or equal to 2.00 to 1.00
and less than 2.50 to 1.00
---------------------------------------------------------------------------
4 Greater than or equal to 2.50 to 1.00
and less than 3.00 to 1.00
---------------------------------------------------------------------------
5 Greater than or equal to 3.00 to 1.00
and less than 3.50 to 1.00
---------------------------------------------------------------------------
6 Greater than or equal to 3.50 to 1.00
and less than 4.00 to 1.00
---------------------------------------------------------------------------
7 Greater than or equal to 4.00 to 1.00
and less than 4.25 to 1.00
---------------------------------------------------------------------------
8 Greater than or equal to 4.25 to 1.00
---------------------------------------------------------------------------
Credit Agreement
----------------
14
-8-
"APPROVED ACCOUNT DEBTOR" shall mean each of Xxxxxxxx Aluminum Corporation
and Xxxxxx Corporation (formerly known as Alcoa Building Products) so long as
the senior unsecured, non-credit enhanced debt securities of Xxxxxxxx Aluminum
Corporation or Xxxxxx Corporation, as the case may be, are rated Baa3 or better
by Xxxxx'x and BBB- or better by Standard & Poor's.
"AVAILABLE COMMITMENTS" shall have the meaning assigned to such term in
Section 2.11 hereof.
"BANKRUPTCY CODE" shall mean the Federal Bankruptcy Code of 1978, as
amended from time to time.
"BARMET" shall have the meaning assigned to such term in the recital of
parties to this Agreement.
"BASE RATE" shall mean, for any day, a rate per annum equal to the higher
of (a) the Federal Funds Rate for such day plus 1/2 of 1% and (b) the Prime Rate
for such day. Each change in any interest rate provided for herein based upon
the Base Rate resulting from a change in the Base Rate shall take effect at the
time of such change in the Base Rate.
"BASE RATE LOANS" shall mean Loans that bear interest at rates based upon
the Base Rate.
"BASIC DOCUMENTS" shall mean, collectively, the Credit Documents and the
Acquisition Documents.
"BASLE ACCORD" shall mean the proposals for risk-based capital framework
described by the Basle Committee on Banking Regulations and Supervisory
Practices in its paper entitled "International Convergence of Capital
Measurement and Capital Standards" dated July 1988, as amended, modified and
supplemented and in effect from time to time or any replacement thereof.
Credit Agreement
----------------
00
-0-
"XXXXXXXX" shall mean Alflex and each Revolving Credit Borrower. When
reference is made in this Agreement or in any other Credit Document to the
"relevant" Borrower in connection with any Facility, such reference shall be
deemed to refer, in the case of the Term Loan Facility, to Alflex and, in the
case of the Revolving Credit Facility, to each of CALI, Alflex and Barmet.
"BORROWING BASE" shall mean, as at any date, the sum of:
(a) 85% of the aggregate amount of Eligible Receivables of the
Borrowing Base Group at said date PLUS
(b) 50% of the aggregate value of Eligible Inventory (other than
Eligible Product-in-Process and Special Inventory) of the Borrowing Base
Group at said date PLUS
(c) 35% of the aggregate value of Eligible Product-in-Process of the
Borrowing Base Group at said date PLUS
(d) 20% of the aggregate value of Special Inventory MINUS
(e) an amount equal to two times the average aggregate monthly
Processing Fees payable by Members of the Borrowing Base Group during the
period of two fiscal quarters of the Parent most recently ended on or
before said date PLUS
(f) the aggregate amount of cover for Letter of Credit Liabilities
held by the Administrative Agent in the Collateral Account as contemplated
in Section 2.10(i) hereof;
PROVIDED that not more than 50% of the Borrowing Base shall be composed of
Eligible Inventory, Eligible Product-in-Process and Special Inventory (x) at any
time prior to the Trigger Date or (y) at any time thereafter, when less than
$75,000,000 in the
Credit Agreement
----------------
16
-10-
aggregate is outstanding under Permitted Receivables Financings. The "VALUE" of
Eligible Inventory and Special Inventory shall be determined at the lower of
cost or market in accordance with GAAP, except that:
(i) initially, cost shall be determined for each Member of the
Borrowing Base Group in the manner described in the audited financial
statements referred to in Section 8.02 hereof relating to such Member; and
(ii) from and after receipt by the Administrative Agent of a notice
from the Parent to such effect, cost shall be determined on a
last-in-first-out basis.
"BORROWING BASE CERTIFICATE" shall mean a certificate of a Responsible
Officer of the Parent, substantially in the form of Exhibit B hereto and
appropriately completed.
"BORROWING BASE GROUP" shall mean, collectively, the Parent, Holdings,
CALI, Alflex, Barmet and the Subsidiary Guarantors. A "MEMBER" of the Borrowing
Base Group shall mean, individually, the Parent and each such Subsidiary.
"BUSINESS DAY" shall mean any day (a) on which commercial banks are not
authorized or required to close in New York City and (b) if such day relates to
a borrowing of, a payment or prepayment of principal of or interest on, a
Conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice
by a Borrower with respect to any such borrowing, payment, prepayment,
Conversion or Interest Period, that is also a day on which dealings in Dollar
deposits are carried out in the London interbank market.
"CALCULATION PERIOD" shall mean, at any date, the period of four
consecutive fiscal quarters of the Parent ending on or most recently ended prior
to such date (or, at any date on or prior to September 30, 1997, the period
consisting of the
Credit Agreement
----------------
17
-11-
fiscal quarters of the Parent that have ended after October 1, 1996).
"CALI" shall have the meaning assigned to such term in the recital of
parties to this Agreement.
"CAPITAL EXPENDITURES" shall mean, for any period, expenditures (including,
without limitation, the aggregate amount of Capital Lease Obligations paid or
payable during such period) made by the Parent or any of its Subsidiaries to
acquire or construct fixed assets, plant and equipment (including renewals,
improvements and replacements, but excluding repairs) during such period
computed in accordance with GAAP.
"CAPITAL LEASE OBLIGATIONS" shall mean, for any Person, all obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
"CAPITAL STOCK" shall mean, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital stock or other ownership
interests, including, without limitation, all common stock and all preferred
stock.
"CASUALTY EVENT" shall mean, with respect to any Property of any Person,
any loss of or damage to, or any condemnation or other taking of, such Property
for which such Person or any of its Subsidiaries receives insurance proceeds, or
proceeds of a condemnation award or other compensation.
Credit Agreement
----------------
18
-12-
"CHANGE OF CONTROL" shall mean:
(a) that any "person" or "group" (as such terms are used for purposes
of Sections 13(d) and 14(d) of the Exchange Act, whether or not applicable,
except that for purposes of this paragraph (b) such person or group shall
be deemed to have "beneficial ownership" of all shares that such person or
group has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), is or becomes the
"beneficial owner" (as such term is used in Rule 13d-3 promulgated pursuant
to the Exchange Act), directly or indirectly, of more than 25% of the
aggregate voting power of all Voting Stock of the Parent; or
(b) that individuals who on the date hereof constituted the Board of
Directors of the Parent (together with any new directors whose election by
such Board or whose nomination for election by the stockholders of the
Parent was approved by a majority of the directors then still in office who
were either directors on the date hereof or whose election or nomination
for election was previously so approved) cease for any reason to constitute
a majority of the Board of Directors of the Parent; or
(c) that the Parent shall be required pursuant to the provisions of
the Senior Subordinated Debt Documents (or any other agreement or
instrument relating to or providing for any other Subordinated
Indebtedness) to redeem or repurchase, or make an offer to redeem or
repurchase, all or any portion of the Senior Subordinated Debt (or such
Subordinated Indebtedness, as the case may be) as a result of a change of
control (however defined).
"CODE" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
Credit Agreement
----------------
19
-13-
"COLLATERAL ACCOUNT" shall have the meaning assigned to such term in
Section 4.01 of the Pledge and Security Agreement.
"COMMISSION" shall mean the Securities and Exchange Commission, or any
regulatory body that succeeds to the functions thereof.
"COMMITMENTS" shall mean the Term Loan Commitments and the Revolving Credit
Commitments. Where the context requires, the term "Commitments" shall include
reference to the Swingline Commitment.
"COMMITMENT TERMINATION DATE" shall mean the Quarterly Date falling on or
nearest to September 1, 2001.
"COMMODITY HEDGE AGREEMENTS" shall have the meaning assigned to such term
in Section 9.19 hereof.
"COMMONWEALTH GROUP" shall mean the Parent and each of its Subsidiaries,
and a "Member" of the Commonwealth Group shall mean, individually, the Parent
and each of its Subsidiaries.
"CONTINUE", "CONTINUATION" and "CONTINUED" shall refer to the continuation
pursuant to Section 2.09 hereof of a Eurodollar Loan from one Interest Period to
the next Interest Period.
"CONVERT", "CONVERSION" and "CONVERTED" shall refer to a conversion
pursuant to Section 2.09 hereof of one Type of Loans into another Type of Loans,
which may be accompanied by the transfer by a Lender (at its sole discretion) of
a Loan from one Applicable Lending Office to another.
"CREDIT DOCUMENTS" shall mean, collectively, this Agreement, the Notes, the
Letter of Credit Documents and the Security Documents.
Credit Agreement
----------------
20
-14-
"DEBT ISSUANCE" shall mean any incurrence or other issuance of Indebtedness
by the Parent or any of its Subsidiaries after the date hereof, other than any
Specified Debt Issuance.
"DEFAULT" shall mean an Event of Default or an event that with notice or
lapse of time or both would become an Event of Default.
"DELIVERY DATE" shall mean the date following the end of a fiscal quarter
of the Parent on which the Lenders receive the Parent's financial statements
pursuant to Section 9.01(a) hereof for such fiscal quarter.
"DISPOSITION" shall mean any sale, assignment, transfer or other
disposition of any Property (whether now owned or hereafter acquired) by the
Parent or any of its Subsidiaries to any other Person excluding (a) any sale,
assignment, transfer or other disposition of any Property sold or disposed of in
the ordinary course of business and on ordinary business terms and (b)
Receivables Sales.
"DIVIDEND PAYMENT" shall mean dividends (in cash, Property or obligations)
on, or other payments or distributions on account of, or the setting apart of
money for a sinking or other analogous fund for, or the purchase, redemption,
retirement or other acquisition of, any shares of any class of stock of the
Parent or any of its Subsidiaries or of any warrants, options or other rights to
acquire the same (or to make any payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference to the fair
market or equity value of the Parent or any of its Subsidiaries), but excluding
dividends payable solely in shares of Capital Stock of the Parent (or in
options, warrants and other rights to acquire such shares of Capital Stock).
"DOLLARS" and "$" shall mean lawful money of the United States of America.
Credit Agreement
----------------
21
-15-
"EBITDA" shall mean, for any period, the sum, for the Parent and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) net income for such period PLUS (b)
the amount of Total Interest Expense for such period PLUS (c) income and other
taxes paid during such period PLUS (d) depreciation and amortization for such
period PLUS (e) extraordinary losses for such period MINUS (f) extraordinary
gains for such period, MINUS (g) interest received during such period, PLUS (h)
with respect to periods ending on or prior to the first anniversary of the
Original Closing Date, Extraordinary Rationalization Costs paid during such
period up to but not exceeding $15,000,000 in the aggregate. Notwithstanding the
foregoing, (i) EBITDA for the three-month period ended December 31, 1995 shall
be deemed to be $18,900,000, (ii) EBITDA for the three-month period ended March
31, 1996 shall be deemed to be $16,200,000, (iii) EBITDA for the three-month
period ended June 30, 1996 shall be deemed to be $17,400,000 and (iv) EBITDA for
the three-month period ended September 30, 1996 shall be deemed to be
$20,000,000.
"ELIGIBLE INVENTORY" of the Borrowing Base Group shall mean, as at any
date, the sum of the following (determined without duplication):
(a) all Inventory (i) that is owned by (and in the possession or under
the control of) any Member of the Borrowing Base Group as at such date,
(ii) that is located in a jurisdiction in the United States of America,
(iii) as to which appropriate Uniform Commercial Code financing statements
have been filed naming the relevant Member of the Borrowing Base Group as
"debtor" and the Administrative Agent as "secured party", (iv) that is in
good condition, (v) that meets all standards imposed by any governmental
agency or department or division thereof having regulatory authority over
such Inventory, its use or sale and (vi) that is either currently usable or
currently saleable in the normal course of the Borrowing Base Group's
business without any notice to, or consent of, any governmental agency or
Credit Agreement
----------------
22
-16-
department or division thereof (excluding however, except to the extent
that the Majority Lenders otherwise agree with respect to any specific
customer or Processor, any such Inventory that has been shipped to a
customer of the Borrowing Base Group, including Processors, even if on a
consignment or "sale or return" basis), PLUS
(b) all Inventory being processed by Processors on behalf of a Member
of the Borrowing Base Group as at such date, but only to the extent that
the relevant Member of the Borrowing Base Group shall have filed an
appropriate Uniform Commercial Code financing statement in the respective
jurisdiction in which such Inventory is located naming the respective
Processor as "debtor", such Member as "secured party" and the
Administrative Agent as "assignee" and delivered to the Administrative
Agent an opinion of counsel satisfactory to the Administrative Agent to the
effect that (i) to the extent such arrangement constitutes a consignment or
security interest under applicable law, the relevant Member of the
Borrowing Base Group has a valid perfected first priority security interest
in such Inventory, (ii) by virtue of the Pledge and Security Agreement,
such security interest has been validly assigned to the Administrative
Agent and (iii) accordingly the Administrative Agent has a valid and
perfected security interest in such Inventory under the Pledge and Security
Agreement,
PROVIDED that the Majority Lenders (through the Administrative Agent) may at any
time exclude from Eligible Inventory any type of Inventory that the Majority
Lenders (in their sole discretion) determine to be unmarketable.
"ELIGIBLE PRODUCT-IN-PROCESS" of the Borrowing Base Group shall mean
work-in-process (excluding ingots) net of progress xxxxxxxx, if any (as such
items are classified on the consolidated balance sheet of such Person in
accordance with GAAP and consistent with past practice).
Credit Agreement
----------------
23
-17-
"ELIGIBLE RECEIVABLES" of the Borrowing Base Group shall mean, as at any
date, the aggregate amount of all Receivables at such date payable to Members
thereof other than the following (determined without duplication):
(a) any Receivable not payable in Dollars;
(b) any Receivable that, at the date of issuance of the invoice
therefor, was payable more than 60 days (or, in the case of an Extended
Payment Receivable, 90 days) after shipment of the related Inventory
(PROVIDED that the aggregate amount of Extended Payment Receivables
included in "Eligible Receivables" that are payable more than 60 days after
shipment of the related Inventory shall not at any time exceed
$15,000,000);
(c) any Receivable owing from a Subsidiary or Affiliate of a Member of
the Borrowing Base Group;
(d) any Receivable owing from an account debtor whose principal place
of business is located outside of the United States of America and Canada;
(e) any Receivable owing from an account debtor that the Majority
Lenders (through the Administrative Agent) have notified the Parent does
not have a satisfactory credit standing (as reasonably determined by the
Majority Lenders);
(f) any Receivable that is more than 60 days past due;
(g) all Receivables of any account debtor if more than 25% of the
aggregate amount of the Receivables owing from such account debtor shall at
the time be more than 30 days past due;
(h) all Receivables owing from any account debtor (other than an
Approved Account Debtor) to the extent the Receivables owing from such
account debtor and its
Credit Agreement
----------------
24
-18-
Affiliates at the time exceed 5% of all Receivables then payable to the
Members of the Borrowing Base Group;
(i) any Receivable which has been subject, for 60 days or more, to any
claim on the part of the respective account debtor disputing liability
under such Receivable in whole or in part (but only to the extent the
amount of such Receivable in dispute exceeds $50,000);
(j) any Receivable evidenced by an Instrument (as defined in the
Pledge and Security Agreement) not in the possession of the Administrative
Agent;
(k) any Receivable representing an obligation for goods sold on
consignment, approval or a sale-or-return basis or subject to any other
repurchase or return arrangement; and
(l) any Receivable sold under a Permitted Receivables Financing.
"EMPLOYEE STOCK REPURCHASES" shall mean Dividend Payments constituting the
purchase, redemption, retirement or other acquisition of shares of Capital Stock
of the Parent, of options on any such shares or related stock appreciation
rights or similar securities, held by officers, directors or employees or former
directors, officers or employees (or their transferees, estates or beneficiaries
under their estates), upon death, disability, retirement, severance or
termination of employment or service or pursuant to any agreement under which
such shares of Capital Stock or related rights were issued.
"ENVIRONMENTAL CLAIM" shall mean, with respect to any Person, any written
notice, claim, demand or other communication (collectively, a "claim") by any
other Person alleging or asserting such Person's liability for investigatory
costs, cleanup costs, governmental response costs, damages to natural resources
or other Property, personal injuries, fines or
Credit Agreement
----------------
25
-19-
penalties arising out of, based on or resulting from (i) the presence, or
Release into the environment, of any Hazardous Material at any location, whether
or not owned by such Person, or (ii) circumstances forming the basis of any
violation, or alleged violation, of any Environmental Law. The term
"Environmental Claim" shall include, without limitation, any claim by any
governmental authority for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and any
claim by any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from the presence of
Hazardous Materials or arising from alleged injury or threat of injury to
health, safety or the environment.
"ENVIRONMENTAL LAWS" shall mean any and all present and future Federal,
state, local and foreign laws, rules or regulations, and any orders or decrees,
in each case as now or hereafter in effect, relating to the regulation or
protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the environment,
including, without limitation, ambient air, soil, surface water, ground water,
wetlands, land or subsurface strata, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, chemicals or toxic or hazardous substances
or wastes.
"EQUITY ISSUANCE" shall mean (a) any issuance or sale by the Parent or any
of its Subsidiaries after the Original Closing Date of (i) any of its Capital
Stock, (ii) any warrants or options exercisable in respect of its Capital Stock
(other than any warrants or options issued to directors, officers or employees
of the Parent or any of its Subsidiaries pursuant to employee benefit or other
compensation-related plans established in the ordinary course of business and
any Capital Stock of the Parent or such Subsidiary issued upon the exercise of
such warrants or options) or (iii) any other security or instrument
Credit Agreement
----------------
26
-20-
representing an equity interest (or the right to obtain any equity interest) in
the Parent or any of its Subsidiaries or (b) the receipt by the Parent or any of
its Subsidiaries after the Original Closing Date of any capital contribution
(whether or not evidenced by any equity security issued by the recipient of such
contribution); PROVIDED that Equity Issuance shall not include (x) any such
issuance or sale by any Subsidiary of the Parent to the Parent or any Wholly
Owned Subsidiary of the Parent or (y) any capital contribution by the Parent or
any Wholly Owned Subsidiary of the Parent to any Subsidiary of the Parent.
"EQUITY RIGHTS" shall mean, with respect to any Person, any subscriptions,
options, warrants, commitments, preemptive rights or agreements of any kind
(including, without limitation, any stockholders' or voting trust agreements)
for the issuance, sale, registration or voting of, or securities convertible
into, any additional shares of Capital Stock of any class, or partnership or
other ownership interests of any type in, such Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA AFFILIATE" shall mean any corporation or trade or business that is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which the Parent is a member and (ii) solely for purposes of
potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of
the Code and the lien created under Section 302(f) of ERISA and Section 412(n)
of the Code, described in Section 414(m) or (o) of the Code of which the Parent
is a member.
"EURODOLLAR BASE RATE" shall mean, with respect to any Eurodollar Loan for
any Interest Period therefor:
(a) the rate per annum (rounded upwards, if necessary, to the nearest
1/16 of 1%) reported on the date two Business
Credit Agreement
----------------
27
-21-
Days prior to the first day of such Interest Period on Telerate Access
Service Page 3750 (British Bankers Association Settlement Rate) as the
London Interbank Offered Rate for Dollar deposits having a term comparable
to such Interest Period and in an amount of $1,000,000 or more; or
(b) if said Page shall cease to be publicly available or if the
information contained on said Page, in the sole judgment of the
Administrative Agent, shall cease to accurately reflect such London
Interbank Offered Rate, the Eurodollar Base Rate shall mean the arithmetic
mean (rounded upwards, if necessary, to the nearest 1/16 of 1%), as
determined by the Administrative Agent, of the rates per annum quoted by
the respective Reference Lenders at approximately 11:00 a.m. London time
(or as soon thereafter as practicable) on the date two Business Days prior
to the first day of such Interest Period for the offering by the respective
Reference Lenders to leading banks in the London interbank market of Dollar
deposits having a term comparable to such Interest Period and in an amount
comparable to the principal amount of the Eurodollar Loan to be made by the
respective Reference Lenders for such Interest Period (and, if any
Reference Lender is not participating in any Eurodollar Loans during any
Interest Period therefor, the Eurodollar Base Rate for such Loans for such
Interest Period shall be determined by reference to the amount of such
Loans that such Reference Lender would have made or had outstanding had it
been participating in such Loan during such Interest Period).
"EURODOLLAR LOANS" shall mean Loans that bear interest at rates based on
rates referred to in the definition of "Eurodollar Base Rate" in this Section
1.01.
"EURODOLLAR RATE" shall mean, for any Eurodollar Loan for any Interest
Period therefor, a rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) determined by the Administrative Agent to be equal to the
Eurodollar Base Rate
Credit Agreement
----------------
28
-22-
for such Loan for such Interest Period divided by 1 minus the Reserve
Requirement (if any) for such Loan for such Interest Period.
"EVENTS OF DEFAULT" shall have the meaning assigned to such term in Section
10 hereof.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended
from time to time.
"EXISTING LENDERS" shall mean each of the Lenders identified under the
caption "Existing Lenders" on the signature pages hereto.
"EXISTING REVOLVING CREDIT LOANS" means "Post-Merger Revolving Credit
Loans" under and as defined in the Original Credit Agreement outstanding on the
Restatement Effective Date.
"EXISTING TERM LOANS" means "Post-Merger Tranche A Term Loans" under and as
defined in the Original Credit Agreement outstanding on the Restatement
Effective Date.
"EXTENDED PAYMENT RECEIVABLE" shall mean any Receivable having normal trade
terms of more than 60 days and less than or equal to 90 days.
"EXTRAORDINARY RATIONALIZATION COSTS" shall mean rationalization costs
associated with the Acquisition incurred by the Parent and its Subsidiaries, as
determined by the Parent reasonably and in good faith.
"FACILITY" shall mean each of the Term Loan Facility and the Revolving
Credit Facility. Where the context requires, the term "Facility" shall include
reference to the Swingline Facility.
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of
Credit Agreement
----------------
29
-23-
1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, PROVIDED that (a) if the day for
which such rate is to be determined is not a Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day and (b) if such
rate is not so published for any Business Day, the Federal Funds Rate for such
Business Day shall be the average rate charged to NatWest on such Business Day
on such transactions as determined by the Administrative Agent.
"FIXED CHARGES RATIO" shall mean, as at any date, the ratio of (a) (i)
EBITDA for the then-current Calculation Period MINUS (ii) taxes paid during such
period to (b) the sum of (i) Total Interest Expense for such period PLUS (ii)
all regularly scheduled payments of principal of Senior Indebtedness (including,
without limitation, the principal component of any payments in respect of
Capital Lease Obligations) made during such period.
"GAAP" shall mean generally accepted accounting principles applied on a
basis consistent with those that, in accordance with the last sentence of
Section 1.02(a) hereof, are to be used in making the calculations for purposes
of determining compliance with this Agreement.
"GENERAL GUARANTEED OBLIGATIONS" shall have the meaning assigned to such
term in Section 6.01(a) hereof.
"GUARANTEE" shall mean a guarantee, an endorsement, a contingent agreement
to purchase or to furnish funds for the payment or maintenance of, or otherwise
to be or become contingently liable under or with respect to, the Indebtedness,
other obligations, net worth, working capital or earnings of any Person, or a
guarantee of the payment of dividends or other
Credit Agreement
----------------
30
-24-
distributions upon the stock or equity interests of any Person, or an agreement
to purchase, sell or lease (as lessee or lessor) Property, products, materials,
supplies or services primarily for the purpose of enabling a debtor to make
payment of such debtor's obligations or an agreement to assure a creditor
against loss, and including, without limitation, causing a bank or other
financial institution to issue a letter of credit or other similar instrument
for the benefit of another Person, but excluding endorsements for collection or
deposit in the ordinary course of business. The terms "GUARANTEE" and
"GUARANTEED" used as a verb shall have a correlative meaning.
"GUARANTEED OBLIGATIONS" shall have the meaning assigned to such term in
Section 6.01(b) hereof.
"GUARANTORS" shall mean (a) with respect to the General Guaranteed
Obligations, the Parent, Holdings, CALI, Alflex, Barmet and the Subsidiary
Guarantors and (b) with respect to the Joint Obligations, the Revolving Credit
Borrowers.
"HAZARDOUS MATERIAL" shall mean, collectively, (a) any petroleum or
petroleum products, flammable materials, explosives, radioactive materials,
asbestos, urea formaldehyde foam insulation, and transformers or other equipment
that contain polychlorinated biphenyls ("PCB's"), (b) any chemicals or other
materials or substances that are now or hereafter become defined as or included
in the definition of "hazardous substances", "hazardous wastes", "hazardous
materials", "extremely hazardous wastes", "restricted hazardous wastes", "toxic
substances", "toxic pollutants", "contaminants", "pollutants" or words of
similar import under any Environmental Law and (c) any other chemical or other
material or substance, exposure to which is now or hereafter prohibited, limited
or regulated under any Environmental Law.
"HOLDINGS" shall have the meaning assigned to such term in the recital of
parties to this Agreement.
Credit Agreement
----------------
31
-25-
"IMCO RECYCLING" shall mean IMCO Recycling Inc., a Delaware corporation.
"IMCO SUPPLY AGREEMENT" shall mean the Supply Agreement dated as of March
24, 1992 by and between Barmet and IMCO Recycling, as the same may be modified
and supplemented and in effect from time to time.
"IMMATERIAL SUBSIDIARY" shall mean, as at any date:
(a) Commonal Corp., PROVIDED that Commonal Corp. shall cease to be an
"Immaterial Subsidiary" if at any time it shall have (i) at least 5% of the
total consolidated assets of the Parent and its Subsidiaries (determined as
of the last day of the fiscal year of the Parent ending on or most recently
ended prior to such date) or (ii) at least 5% of the consolidated revenues
of the Parent and its Subsidiaries for the fiscal year of the Parent ending
on or most recently ended prior to such date);
(b) each other Subsidiary of the Parent that, as at the end of and for
the quarterly accounting period ending on or most recently ended prior to
such date, shall have less than $500,000 in assets and less than $500,000
in gross revenues; and
(c) any Subsidiary described in Section 9.08(h) hereof.
"INDEBTEDNESS" shall mean, for any Person (without duplication):
(a) obligations created, issued or incurred by such Person for
borrowed money (whether by loan, the issuance and sale of debt securities
or the sale of Property to another Person subject to an understanding or
agreement, contingent or otherwise, to repurchase such Property from such
Person);
Credit Agreement
----------------
32
-26-
(b) obligations of such Person to pay the deferred purchase or
acquisition price of Property or services, other than trade accounts
payable (other than for borrowed money) arising, and accrued liabilities
incurred, in the ordinary course of business so long as such trade accounts
payable are payable within 90 days of the date the respective goods are
delivered or the respective services are rendered;
(c) Indebtedness of others secured by a Lien on the Property of such
Person, whether or not the respective indebtedness so secured has been
assumed by such Person;
(d) obligations of such Person in respect of letters of credit or
similar instruments issued or accepted by banks and other financial
institutions for account of such Person;
(e) Capital Lease Obligations of such Person; and
(f) Indebtedness of others Guaranteed by such Person.
"INFORMATION MEMORANDUM" shall mean the Confidential Information Memorandum
dated September, 1996 with respect to the credit facilities provided under this
Agreement.
"INTEREST PERIOD" shall mean, with respect to any Eurodollar Loan, each
period commencing on the date such Eurodollar Loan is made or Converted from a
Base Rate Loan or (in the event of a Continuation) the last day of the next
preceding Interest Period for such Loan and ending on the numerically
corresponding day in the first, second, third or sixth calendar month
thereafter, as the relevant Borrower may select as provided in Section 4.05
hereof, except that each Interest Period that commences on the last Business Day
of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on the
last Business Day of the appropriate subsequent calendar month.
Credit Agreement
----------------
33
-27-
Notwithstanding the foregoing:
(i) no Interest Period for any Term Loan may commence before and end
after any Principal Payment Date unless, after giving effect thereto, the
aggregate principal amount of the Term Loans having Interest Periods that
end after such Principal Payment Date shall be equal to or less than the
aggregate principal amount of the Term Loans scheduled to be outstanding
after giving effect to the payments of principal required to be made on
such Principal Payment Date;
(ii) if any Interest Period for any Loan under the Revolving Credit
Facility would otherwise end after the Commitment Termination Date, such
Interest Period shall end on the Commitment Termination Date;
(iii) each Interest Period that would otherwise end on a day that is
not a Business Day shall end on the next succeeding Business Day (or, if
such next succeeding Business Day falls in the next succeeding calendar
month, on the next preceding Business Day); and
(iv) notwithstanding clause (i) and (ii) above, no Interest Period
shall have a duration of less than one month and, if the Interest Period
for any Eurodollar Loan would otherwise be a shorter period, such Loan
shall not be available hereunder for such period.
"INTEREST RATE PROTECTION AGREEMENT" shall mean, for any Person, an
interest rate swap, cap or collar agreement or similar arrangement between such
Person and one or more financial institutions providing for the transfer or
mitigation of interest risks either generally or under specific contingencies.
"INVENTORY" shall mean all readily marketable materials, including raw
materials, of a type manufactured or
Credit Agreement
----------------
34
-28-
consumed by the Members of the Borrowing Base Group in the ordinary course of
business as presently conducted (including ingots but excluding, in any event,
all work-in-process).
"INVESTMENT" shall mean, for any Person: (a) the acquisition (whether for
cash, Property, services or securities or otherwise) of Capital Stock, bonds,
notes, debentures, partnership or other ownership interests or other securities
of any other Person or any agreement to make any such acquisition (including,
without limitation, any "short sale" or any sale of any securities at a time
when such securities are not owned by the Person entering into such sale); (b)
the making of any deposit with, or advance, loan or other extension of credit
to, any other Person (including the purchase of Property from another Person
subject to an understanding or agreement, contingent or otherwise, to resell
such Property to such Person), but excluding any such advance, loan or extension
of credit having a term not exceeding 90 days arising in connection with the
sale of inventory or supplies by such Person in the ordinary course of business;
(c) the entering into of any Guarantee of, or other contingent obligation with
respect to, Indebtedness or other liability of any other Person and (without
duplication) any amount committed to be advanced, lent or extended to such
Person; (d) the entering into of any Interest Rate Protection Agreement; or (e)
the entering into of any Commodity Hedge Agreement.
"ISSUING BANK" shall mean NatWest and each other Lender requested by the
Parent and approved by the Administrative Agent to be an "Issuing Bank"
hereunder, as the issuers of Letters of Credit under Section 2.03 hereof,
together with their respective successors and assigns in such capacity.
"JOINT OBLIGATIONS" shall have the meaning assigned to such term in Section
6.01(b) hereof.
"LENDER" shall have the meaning assigned to such term in the recital of
parties to this Agreement. When reference is made in this Agreement or any other
Credit Document to any
Credit Agreement
----------------
35
-29-
"relevant" Lender in connection with any Facility, such reference shall be
deemed to refer to a Lender that has a Commitment, outstanding Loans or
outstanding Notes under such Facility.
"LETTER OF CREDIT DOCUMENTS" shall mean, with respect to any Letter of
Credit, collectively, any application therefor and any other agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to such
Letter of Credit or (b) any collateral security for any of such obligations,
each as the same may be modified and supplemented and in effect from time to
time.
"LETTER OF CREDIT INTEREST" shall mean, for each Revolving Credit Lender,
such Lender's participation interest (or, in the case of the relevant Issuing
Bank, such Issuing Bank's retained interest) in an Issuing Bank's liability
under Letters of Credit issued by such Issuing Bank and such Lender's rights and
interests in Reimbursement Obligations and fees, interest and other amounts
payable in connection with Letters of Credit and Reimbursement Obligations.
"LETTER OF CREDIT LIABILITY" shall mean, without duplication, at any time
and in respect of any Letter of Credit, the sum of (a) the undrawn face amount
of such Letter of Credit PLUS (b) the aggregate unpaid principal amount of all
Reimbursement Obligations at such time due and payable in respect of all
drawings made under such Letter of Credit. For purposes of this Agreement, a
Revolving Credit Lender (other than the Issuing Bank that issued the relevant
Letter of Credit) shall be deemed to hold a Letter of Credit Liability in an
amount equal to its participation interest in the related Letter of Credit under
Section 2.03 hereof, and such Issuing Bank shall be deemed to hold a Letter of
Credit Liability in an amount equal to its retained interest in the related
Letter of Credit after giving effect to the acquisition by the Revolving Credit
Lenders other
Credit Agreement
----------------
36
-30-
than such Issuing Bank of their participation interests under said Section 2.03.
"LETTERS OF CREDIT" shall have the meaning assigned to such term in
Section 2.03(a) hereof.
"LIEN" shall mean, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Agreement and the other Credit Documents, a
Person shall be deemed to own subject to a Lien any Property that it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
(other than an operating lease) relating to such Property.
"LOANS" shall mean each of the Term Loans and the Revolving Credit Loans.
Where the context requires, the term "Loans" shall include reference to
Swingline Loans.
"MAJORITY LENDERS" shall mean Lenders holding at least 51% of the sum of
(i) the aggregate unused Commitments, (ii) the aggregate unpaid principal amount
of the Loans and (iii) the aggregate amount of all Letter of Credit Liabilities.
"MAJORITY REVOLVING CREDIT LENDERS" shall mean Revolving Credit Lenders
having at least 51% of the aggregate amount of the Revolving Credit Commitments
or, if the Revolving Credit Commitments shall have terminated, Lenders holding
at least 51% of the sum of (a) the aggregate unpaid principal amount of the
Revolving Credit Loans plus (b) the aggregate amount of all Letter of Credit
Liabilities.
"MAJORITY TERM LOAN LENDERS" shall mean Term Loan Lenders holding at least
51% of the aggregate Term Loan Commitments (or, if the Term Loan Commitments
have been terminated, Lenders holding at least 51% of the aggregate unpaid
principal amount of the Term Loans).
Credit Agreement
----------------
37
-31-
"MARGIN STOCK" shall mean "margin stock" within the meaning of Regulations
G, T, U and X.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on (a) the
business, properties, assets, operations, conditions (financial or otherwise),
or prospects of the Parent and its Subsidiaries taken as a whole, (b) the
ability of any Obligor to perform its obligations under any of the Basic
Documents to which it is a party, (c) the validity or enforceability of any of
the Basic Documents, (d) the rights and remedies of the Lenders and the
Administrative Agent under any of the Credit Documents or (e) the timely payment
of the principal of or interest on the Loans or the Reimbursement Obligations or
other amounts payable in connection therewith.
"MERGER" shall mean the merger of New CALC with and into Old CasTech in
accordance with the terms of the Merger Agreement, with Old CasTech being the
surviving corporation.
"MERGER AGREEMENT" shall mean the Agreement and Plan of Merger dated as of
August 19, 1996 among Old CasTech, the Parent and New CALC, as the same shall,
subject to Section 9.18 hereof, be modified and supplemented and in effect from
time to time.
"MOODY'S" shall mean Xxxxx'x Investors Service, Inc., or any successor
thereto.
"MORTGAGES" shall mean, collectively, one or more Instruments of Mortgage,
Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing
executed by one or more Obligors pursuant to Section 7.01(m) and 7.03(d) of the
Original Credit Agreement or Section 9.17(a) or 9.20 hereof, in each case
substantially in the form of Exhibit F-1 or F-2 to the Original Credit
Agreement, as the case may be, and covering the respective Properties and
leasehold interest identified in Schedules I and II thereto, as said Instruments
of Mortgage, Deed of Trust,
Credit Agreement
----------------
38
-32-
Assignment of Rents, Security Agreement and Fixture Filing shall be modified and
supplemented and in effect from time to time.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions are being made by the Parent or
any ERISA Affiliate and that is covered by Title IV of ERISA.
"NATWEST" shall mean National Westminster Bank Plc.
"NET AVAILABLE PROCEEDS" shall mean:
(i) in the case of any Disposition, the amount of Net Cash Payments
received in connection with such Disposition;
(ii) in the case of any Casualty Event, the aggregate amount of
proceeds of insurance, condemnation awards and other compensation received
by the Parent and its Subsidiaries in respect of such Casualty Event net of
(A) reasonable expenses incurred by the Parent and its Subsidiaries in
connection therewith and (B) contractually required repayments of
Indebtedness to the extent secured by a Lien on such Property and any
income and transfer taxes payable by the Parent or any of its Subsidiaries
in respect of such Casualty Event;
(iii) in the case of any Equity Issuance or Debt Issuance, the
aggregate amount of all cash received by the Parent and its Subsidiaries in
respect thereof net of reasonable expenses incurred by the Parent and its
Subsidiaries in connection therewith; and
(iv) in the case of any Receivables Sale, the aggregate amount of all
cash received by the Parent and its Subsidiaries in connection with such
Receivables Sale net of reasonable expenses incurred by the Parent and its
Subsidiaries in connection therewith.
Credit Agreement
----------------
39
-33-
"NET CASH PAYMENTS" shall mean, with respect to any Disposition, the
aggregate amount of all cash payments (including, without limitation, all cash
payments received by way of deferred payment pursuant to a note or installment
receivable or otherwise, but only as and when received) received by the Parent
and its Subsidiaries directly or indirectly in connection with such Disposition;
PROVIDED that (a) Net Cash Payments shall be net of (i) the amount of any legal,
title and recording tax expenses, commissions and other fees and expenses paid
or payable by the Parent and its Subsidiaries in connection with such
Disposition and (ii) any Federal, state and local income or other taxes
estimated to be payable by the Parent and its Subsidiaries as a result of such
Disposition (but only to the extent that such estimated taxes are in fact paid
to the relevant Federal, state or local governmental authority within six months
of the date of such Disposition) and (b) Net Cash Payments shall be net of any
repayments by the Parent or any of its Subsidiaries of Indebtedness to the
extent that (i) such Indebtedness is secured by a Lien on the Property that is
the subject of such Disposition and (ii) the transferee of (or holder of a Lien
on) such Property requires that such Indebtedness be repaid as a condition to
the purchase of such Property.
"NEW CALC" shall mean CALC Corporation, a Delaware corporation and a
predecessor of Alflex.
"NEW LENDERS" shall mean each of the Lenders identified under the caption
"New Lenders" on the signature pages hereto.
"NON-UTILIZATION FEES" shall have the meaning assigned to such term in
Section 2.05(a) hereof.
"NOTES" shall mean each of the Term Loan Notes and the Revolving Credit
Notes. Where the context requires, the term "Notes" shall include reference to
the Swingline Note.
"OBLIGORS" shall mean, collectively, the Borrowers and the Guarantors.
Credit Agreement
----------------
40
-34-
"OFFER TO PURCHASE" shall mean the Offer to Purchase dated August 22, 1996,
issued by New CALC in connection with the Acquisition, as the same shall,
subject to Section 9.18 hereof, be modified and supplemented and in effect from
time to time.
"OLD CASTECH" shall be a reference to Alflex with respect to periods prior
to the Merger.
"OLD CASTECH SHARE" shall mean a share of common stock, par value $0.01 per
share, of Old CasTech.
"ORIGINAL CLOSING DATE" shall mean September 20, 1996, being the date on
which the initial loans were made under the Original Credit Agreement and the
date on which the Merger became effective in accordance with the terms of the
Merger Agreement.
"ORIGINAL CREDIT AGREEMENT" shall have the meaning assigned to such term in
the Preliminary Statements to this Agreement.
"OTHER EVENT OF DEFAULT" shall mean an Event of Default other than under
Section 10(a) or 9.10 hereof.
"PARENT" shall have the meaning assigned to such term in the recital of
parties to this Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED INVESTMENTS" shall mean:
(a) direct obligations of the United States of America, or of any
agency thereof, or obligations guaranteed as to principal and interest by
the United States of America, or of any agency thereof, in either case
maturing not more than 90 days from the date of acquisition thereof;
Credit Agreement
----------------
41
-35-
(b) time deposits or certificates of deposit issued by any bank or
trust company organized under the laws of the United States of America or
any state thereof whose outstanding senior long-term debt securities are
rated either A- or better by Standard & Poor's or A3 or better by Moody's,
maturing not more than 90 days from the date of acquisition thereof;
(c) commercial paper rated A-1 or better or P-1 by Standard & Poor's
or Moody's, respectively, maturing not more than 90 days from the date of
acquisition thereof;
(d) repurchase obligations with a term of not more than 30 days for
underlying securities of the types specified in paragraph (a) of this
definition with any bank or trust company meeting the qualifications
specified in paragraph (b) of this definition; and
(e) Investments in money market mutual funds substantially all of the
assets of which are cash or Permitted Investments specified in paragraphs
(a) through (d) of this definition;
in each case so long as the same (i) provide for the payment of principal and
interest (and not principal alone or interest alone) and (ii) are not subject to
any contingency regarding the payment of principal or interest.
"PERMITTED RECEIVABLES FINANCING" shall mean a transaction or series of
transactions (including amendments, supplements, extensions, renewals,
replacements, refinancings or modifications thereof) pursuant to which a
Securitization Subsidiary purchases Receivables and Related Assets from the
Parent or any of its Subsidiaries and finances such Receivables and Related
Assets through the issuance of Indebtedness or equity interests or through the
sale of the Receivables and Related Assets or a fractional undivided interest in
the Receivables and
Credit Agreement
----------------
42
-36-
Related Assets; PROVIDED that (a) the Board of Directors of the Parent shall
have determined in good faith that such Permitted Receivables Financing is
economically fair and reasonable to the Parent and such Securitization
Subsidiary, (b) all sales of Receivables and Related Assets to or by such
Securitization Subsidiary are made at fair market value (as determined in good
faith by the Board of Directors of the Parent), (c) the interest rate applicable
to such financing shall be a market rate of interest as of the time such
financing is entered into, (d) the covenants, termination events and other
provisions thereof shall be market terms (as determined in good faith by the
Board of Directors of the Parent), (e) no portion of the Indebtedness of a
Securitization Subsidiary is Guaranteed by or is recourse to the Parent or any
of its other Subsidiaries (other than recourse for customary representations,
warranties, covenants and indemnities, none of which shall related to the
collectibility of the Receivables and Related Assets) and (f) neither the Parent
nor any of its other Subsidiaries has any obligation to maintain or preserve
such Securitization Subsidiary's financial condition.
"PERMITTED REINVESTMENT CAPITAL EXPENDITURES" shall mean Capital
Expenditures made with the Net Available Proceeds of Casualty Events and
Dispositions that the Parent or any of its Subsidiaries is reinvesting in
replacement assets in accordance with Sections 2.10 and 9.05(c) hereof.
"PERSON" shall mean any individual, corporation, company, voluntary
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or government (or any agency, instrumentality or
political subdivision thereof).
"PLACEMENT AGREEMENT" shall mean the Placement Agreement dated as of
September 20, 1996 pursuant to which the purchasers of the Senior Subordinated
Debt have agreed to purchase and re-offer the same.
Credit Agreement
----------------
43
-37-
"PLAN" shall mean an employee benefit or other plan established or
maintained by the Parent or any ERISA Affiliate and that is covered by Title IV
of ERISA, other than a Multiemployer Plan.
"PLEDGE AND SECURITY AGREEMENT" shall mean an Amended and Restated Pledge
and Security Agreement substantially in the form of Exhibit C hereto between the
Obligors and the Administrative Agent, as the same shall be modified and
supplemented and in effect from time to time.
"POST-DEFAULT RATE" shall mean a rate per annum equal to 2.0% PLUS the Base
Rate as in effect from time to time plus the Applicable Margin for Base Rate
Loans, PROVIDED that the "Post-Default Rate" with respect to principal of a
Eurodollar Loan shall be 2.0% PLUS the interest rate for such Loan as provided
in Section 3.02(b) hereof.
"PRIME RATE" shall mean, at any time, the Bank Prime Loan rate then most
recently published by the Board of Governors of the Federal Reserve System in
Federal Reserve Statistical Release H.15(519) entitled "Selected Interest
Rates", or any successor publication.
"PRINCIPAL PAYMENT DATES" shall mean the Quarterly Dates falling on or
nearest to March 1, June 1, September 1 and December 1 of each year, commencing
with December 1, 1996 through and including September 1, 2001.
"PROCESSING FEES" shall mean commissions and processing fees payable to
bailees, warehousemen, terminal operators, Processors and other third parties
holding Inventory of Members of the Borrowing Base Group, but excluding, in any
event, fees payable to IMCO Recycling under the IMCO Supply Agreement.
"PROCESSOR" shall mean a third party (including, without limitation, IMCO
Recycling) that processes Inventory of one or more Members of the Borrowing Base
Group.
Credit Agreement
----------------
44
-38-
"PROPERTY" shall mean any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
"QUARTERLY DATES" shall mean the first Business Day of March, June,
September and December in each year, the first of which shall be the first such
day after the date of the Original Credit Agreement.
"QUARTERLY FINANCIAL STATEMENTS" shall mean the financial statements
furnished to the Lenders under Section 9.01(a) hereof (and, prior to the
delivery of the first financial statements under said Section 9.01(a), the
quarterly financial statements of the Parent as at June 30, 1996 referred to in
Section 8.02(a) hereof).
"RECAPTURE DATE" shall mean the last day of each Recapture Period.
"RECAPTURE PERIOD" shall mean:
(a) the period commencing on the Original Closing Date and ending on
the last day of the calendar month following the first date on which the
Parent and/or any of its Subsidiaries receives Net Cash Payments which,
together with all Net Cash Payments received by the Parent and its
Subsidiaries on and after the Original Closing Date, equal or exceed in the
aggregate $1,000,000; and
(b) thereafter, each period commencing on the date immediately
following the last day of the immediately preceding Recapture Period and
ending on the last day of the calendar month following the first date on
which the Parent and/or any of its Subsidiaries receives Net Cash Payments
which, together with all Net Cash Payments received by the Parent and its
Subsidiaries on and after the date immediately following the last day of
the immediately
Credit Agreement
----------------
45
-39-
preceding Recapture Period, equal or exceed in the aggregate $1,000,000.
"RECEIVABLES" of any Member of the Borrowing Base Group shall mean, as at
any date, the unpaid portion of the obligation, as stated on the respective
invoice, of a customer of such Member in respect of Inventory sold and shipped
by such Member to such customer, net of any credits, rebates or offsets owed to
such customer and also net of any commissions payable to third parties (and for
purposes hereof, a credit or rebate paid by check or draft of such Member or any
of its Subsidiaries shall be deemed to be outstanding until such check or draft
shall have been debited to the account of such Person on which such check or
draft was drawn).
"RECEIVABLES AND RELATED ASSETS" shall mean accounts receivable and
instruments, chattel paper, obligations, general intangibles and other similar
assets, in each case relating to such receivables, including interests in
merchandise or goods, the sale or lease of which gave rise to such receivable,
related contractual rights, guarantees, insurance proceeds, collections, other
related assets and proceeds of all of the foregoing.
"RECEIVABLES SALE" shall mean any sale, transfer or other disposition of
Receivables and Related Assets by the Parent or any of its Subsidiaries, but
excluding sales or transfers of Receivables and Related Assets for purposes of
collection in the ordinary course of business and consistent with past practice.
"REFERENCE LENDERS" shall mean NatWest and such other Lender or Lenders as
the Administrative Agent and the Parent shall agree (or their respective
Applicable Lending Offices, as the case may be).
"REGULATION A", "REGULATION D", "REGULATION G", "REGULATION T", "REGULATION
U" and "REGULATION X" shall mean, respectively, Regulations A, D, G, T, U and X
of the Board of Governors of the Federal Reserve System (or any successor), as
Credit Agreement
----------------
46
-40-
the same may be modified and supplemented and in effect from time to time.
"REGULATORY CHANGE" shall mean, with respect to any Lender, any change
after the date hereof in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Lender of or under any Federal, state or foreign law or
regulations (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"REIMBURSEMENT OBLIGATION" shall mean, at any time, the obligations of the
Revolving Credit Borrowers then outstanding, or that may thereafter arise in
respect of all Letters of Credit then outstanding, to reimburse amounts paid by
an Issuing Bank in respect of any drawings under a Letter of Credit issued by
such Issuing Bank.
"RELEASE" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the environment, including, without limitation, the movement of Hazardous
Materials through ambient air, soil, surface water, ground water, wetlands, land
or subsurface strata.
"RELEVANT PARTIES" shall have the meaning assigned to such term in Section
10(b) hereof.
"RESERVED COMMITMENTS" shall have the meaning assigned to such term in
Section 2.11(a) hereof.
"RESERVE REQUIREMENT" shall mean, for any Interest Period for any
Eurodollar Loan, the average maximum rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required to be
maintained
Credit Agreement
----------------
47
-41-
during such Interest Period under Regulation D by member banks of the Federal
Reserve System in New York City with deposits exceeding one billion Dollars
against "Eurocurrency liabilities" (as such term is used in Regulation D).
Without limiting the effect of the foregoing, the Reserve Requirement shall
include any other reserves required to be maintained by such member banks by
reason of any Regulatory Change with respect to (i) any category of liabilities
that includes deposits by reference to which the Eurodollar Base Rate is to be
determined as provided in the definition of "Eurodollar Base Rate" in this
Section 1.01 or (ii) any category of extensions of credit or other assets that
includes Eurodollar Loans.
"RESPONSIBLE OFFICER" shall mean, with respect to any Person, the
Treasurer, Chief Financial Officer and Controller of such Person and such other
officers of the relevant Person as the Administrative Agent may agree.
"RESTATEMENT EFFECTIVE DATE" shall mean the date on which the conditions to
effectiveness set forth in Section 7.02 hereof shall have been satisfied or
waived.
"REVOLVING CREDIT BORROWER" shall mean each of CALI, Alflex and Barmet.
"REVOLVING CREDIT BORROWING PERIOD" shall mean the period from and
including the Restatement Effective Date to but not including the Commitment
Termination Date.
"REVOLVING CREDIT COMMITMENT" shall mean, as to each Revolving Credit
Lender, the obligation of such Lender to make Revolving Credit Loans, and to
issue or participate in Letters of Credit pursuant to Section 2.03 hereof, in an
aggregate principal or face amount at any one time outstanding up to but not
exceeding the amount set opposite the name of such Lender on Schedule I hereto
under the caption "Revolving Credit Commitment" or, in the case of a Person that
becomes a Revolving Credit Lender pursuant to an assignment permitted under
Section 12.06(b)
Credit Agreement
----------------
48
-42-
hereof, as specified in the respective instrument of assignment pursuant to
which such assignment is effected (as the same may be reduced from time to time
pursuant to Section 2.04 or 2.10 hereof). The original aggregate principal
amount of the Revolving Credit Commitments is $225,000,000.
"REVOLVING CREDIT COMMITMENT PERCENTAGE" shall mean, with respect to any
Revolving Credit Lender, the ratio of (a) the amount of the Revolving Credit
Commitment of such Lender to (b) the aggregate amount of the Revolving Credit
Commitments of all of the Lenders.
"REVOLVING CREDIT FACILITY" shall mean the revolving credit facility
provided hereunder in respect of the Revolving Credit Commitments.
"REVOLVING CREDIT LENDERS" shall mean (a) on the date hereof, the Lenders
having Revolving Credit Commitments on Schedule I hereto and (b) thereafter, the
Lenders from time to time holding Revolving Credit Loans or and Revolving Credit
Commitments after giving effect to any assignments thereof permitted by Section
12.06(b) hereof.
"REVOLVING CREDIT LOANS" shall mean the loans provided for by Section
2.01(b) hereof, which may be Base Rate Loans and/or Eurodollar Loans.
"REVOLVING CREDIT NOTES" shall mean the promissory notes under the
Revolving Credit Facility provided for by Section 2.08(a) hereof and all
promissory notes delivered in substitution or exchange therefor, in each case as
the same shall be modified and supplemented and in effect from time to time.
"SECURITIZATION SUBSIDIARY" shall mean a Subsidiary of the Parent (all of
the outstanding Capital Stock of which, other than DE MINIMIS preferred stock
and director's qualifying shares, if any, is owned, directly or indirectly, by
the Parent) or another special purpose vehicle that is established for the
Credit Agreement
----------------
49
-43-
limited purpose of acquiring and financing Receivables and Related Assets of the
Parent and/or any of its Subsidiaries and engaging in activities ancillary
thereto.
"SECURITY DOCUMENTS" shall mean, collectively, the Pledge and Security
Agreement, the Mortgages and all Uniform Commercial Code financing statements
required thereby to be filed with respect to the security interests in personal
Property and fixtures created pursuant thereto.
"SENIOR INDEBTEDNESS" shall mean all Indebtedness of the Parent and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP) other than Subordinated Indebtedness.
"SENIOR INDEBTEDNESS TO EBITDA RATIO" shall mean:
(a) for determinations prior to September 30, 1996, the ratio of (i)
Senior Indebtedness outstanding at the close of business on the Original
Closing Date to (ii) $79,900,000; and
(b) for determinations on and after September 30, 1996, the ratio of
(i) Senior Indebtedness outstanding as at the last day of any fiscal
quarter of the Parent ending on or most recently ended prior to such day to
(ii) TTM EBITDA as at such day.
"SENIOR INTEREST COVERAGE RATIO" shall mean, at any date, the ratio of (a)
EBITDA for the then-current Calculation Period to (b) Senior Interest Expense
for such period.
"SENIOR INTEREST EXPENSE" shall mean, for any period, the sum, for the
Parent and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of all interest in respect of Specified
Senior Bank Debt accrued during such period (whether or not actually paid during
such period).
Credit Agreement
----------------
50
-44-
"SENIOR LEVERAGE RATIO" shall mean, as at any date, the ratio of (a)
Specified Senior Bank Debt as at such date to (b) EBITDA for the period of four
consecutive fiscal quarters of the Parent ending on or most recently ended prior
to such date for which Quarterly Financial Statements have been delivered.
"SENIOR SUBORDINATED DEBT" shall mean the Indebtedness of the Parent in
respect of the 10-3/4% Senior Subordinated Notes of the Parent due October 1,
2006 issued under the Senior Subordinated Debt Indenture.
"SENIOR SUBORDINATED DEBT DOCUMENTS" shall mean the Placement Agreement,
the Senior Subordinated Debt Indenture, the securities or other instruments
evidencing the Senior Subordinated Debt and all other documents, instruments and
agreements executed and delivered in connection with the original issuance of
the Senior Subordinated Debt, in each case, as the same shall, subject to
Section 9.18 hereof, be modified and supplemented and in effect from time to
time.
"SENIOR SUBORDINATED DEBT INDENTURE" shall mean the Indenture dated as of
September 20, 1996 between the Parent, each of the subsidiary guarantors party
thereto and Xxxxxx Trust and Savings Bank, as Trustee, as supplemented by a
First Supplemental Indenture thereto dated as of November 12, 1996 in
substantially the form delivered to the Lenders prior to the date hereof and as
the same shall, subject to Section 9.18 hereof, be further modified and
supplemented and in effect from time to time.
"SIGNING DATE" shall mean the earliest date as of which each of the
intended parties hereto shall have executed and delivered counterparts hereof.
"SPECIAL INVENTORY" of the Borrowing Base Group shall mean, as at any date,
all Inventory (other than Eligible Inventory) of Alflex constituting finished
goods being held by third parties on consignment on behalf of Members of the
Credit Agreement
----------------
51
- 45 -
Borrowing Base Group in the ordinary course of business as at such date, but
only to the extent that the relevant Member of the Borrowing Base Group shall
have filed an appropriate Uniform Commercial Code financing statement in the
respective jurisdiction in which such Inventory is located naming the respective
Processor or other third party as "debtor", such Member as "secured party" and
the Administrative Agent as "assignee"; PROVIDED that the Majority Lenders
(through the Administrative Agent) may at any time exclude from Special
Inventory any type of Inventory that the Majority Lenders (in their sole
discretion) determine to be unmarketable.
"SPECIFIED DEBT ISSUANCE" shall mean any incurrence or issuance of
Indebtedness under Section 9.07 hereof other than under paragraph (g) thereof
(except to the extent such Indebtedness constitutes Capital Lease Obligations
and other Indebtedness secured by Liens permitted under Section 9.06(i) or
9.06(j) hereof).
"SPECIFIED EVENT OF DEFAULT PERIOD" shall mean:
(a) any period during which an Event of Default has occurred and is
continuing under Section 10(a) hereof;
(b) any period during which an Event of Default has occurred and is
continuing under Section 9.10 hereof; and
(c) the period specified below relating to any Other Event of Default
that continues unremedied for a period of 30 or more days after notice
thereof to the Parent by the Administrative Agent or any Lender (through
the Administrative Agent). For purposes of this paragraph (c), the
"Specified Event of Default Period" relating to any Other Event of Default
shall be the period:
(i) commencing on the earlier of (x) the date on which the Parent
first obtains knowledge of the occurrence of such Other Event of
Default and (y) the
Credit Agreement
----------------
52
- 46 -
date on which notice of such Other Event of Default is delivered to
the Parent by the Administrative Agent or any Lender (through the
Administrative Agent) and
(ii) ending on the date on which such Other Event of Default is
cured or waived.
"SPECIFIED SENIOR BANK DEBT" shall mean all Indebtedness of the Parent and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP) in respect of Loans and Letters of Credit.
"STANDARD & POOR'S" shall mean Standard & Poor's Ratings Services, a
division of The McGraw Hill Companies, Inc., or any successor thereto.
"STOCK REPURCHASES" shall mean Dividend Payments constituting the purchase,
redemption, retirement or other acquisition of shares of any class of Capital
Stock of the Parent, but excluding Employee Stock Repurchases.
"SUBORDINATED INDEBTEDNESS" shall mean, collectively, (a) Senior
Subordinated Debt and (b) other Indebtedness (i) for which the Parent is
directly and primarily liable, (ii) in respect of which none of its Subsidiaries
is contingently or otherwise obligated and (iii) that is subordinated to the
obligations of the Obligors hereunder on terms, and pursuant to documentation
containing other terms (including interest, amortization, covenants and events
of default), no less favorable to the Lenders than the terms set forth in the
Senior Subordinated Debt Documents or otherwise in form and substance
satisfactory to the Majority Lenders.
"SUBSIDIARY" shall mean, with respect to any Person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
Credit Agreement
----------------
53
- 47 -
functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other
class or classes of such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.
"SUBSIDIARY GUARANTORS" shall have the meaning assigned to such term in the
recital of parties to this Agreement.
"SWINGLINE COMMITMENT" shall mean the obligation of the Swingline Lender to
make Swingline Loans in an aggregate principal at any one time outstanding up to
but not exceeding $20,000,000.
"SWINGLINE FACILITY" shall mean the swingline facility provided hereunder
in respect of the Swingline Commitments.
"SWINGLINE LENDER" shall mean NatWest in its capacity as lender under the
Swingline Facility, together with its successors in such capacity.
"SWINGLINE LOANS" shall have the meaning assigned to such term in Section
2.01(c) hereof.
"SWINGLINE NOTE" shall mean a promissory note provided for by Section
2.08(a) hereof and any promissory note delivered in substitution or exchange
therefor, in each case as the same shall be modified and supplemented and in
effect from time to time.
"TENDER OFFER" shall mean the offer by New CALC to purchase for cash all of
the Old CasTech Shares pursuant to the Tender Offer Documents.
Credit Agreement
----------------
54
- 48 -
"TENDER OFFER DOCUMENTS" shall mean the Offer to Purchase, the Schedule
14D-1 filed by New CALC with respect to the Offer to Purchase, and all
amendments, exhibits and schedules thereto and related documents distributed to
the shareholders of Old CasTech or filed with the Commission in connection with
the Acquisition.
"TERM LOAN COMMITMENT" shall mean, as to each Term Loan Lender, the
obligation of such Lender to make a single Term Loan in an aggregate principal
amount up to but not exceeding the amount set opposite the name of such Lender
on Schedule I hereto under the caption "Term Loan Commitment" or, in the case of
a Person that becomes a Term Loan Lender pursuant to an assignment permitted
under Section 12.06(b) hereof, as specified in the respective instrument of
assignment pursuant to which such assignment is effected (as the same may be
reduced from time to time pursuant to Section 2.04 or 2.10 hereof). The original
aggregate principal amount of the Term Loan Commitments is $100,000,000.
"TERM LOAN FACILITY" shall mean the term loan facility provided hereunder
in respect of the Term Loan Commitments.
"TERM LOAN LENDERS" shall mean (a) on the date hereof, the Lenders having
Term Loan Commitments on Schedule I hereto and (b) thereafter, the Lenders from
time to time holding Term Loans and Term Loan Commitments after giving effect to
any assignments thereof permitted by Section 12.06(b) hereof.
"TERM LOAN NOTES" shall mean the promissory notes under the Term Loan
Facility provided for by Section 2.08(a) hereof and all promissory notes
delivered in substitution or exchange therefor, in each case as the same shall
be modified and supplemented and in effect from time to time.
"TERM LOANS" shall mean the loans provided for by Section 2.01(a) hereof,
which may be Base Rate Loans and/or Eurodollar Loans.
Credit Agreement
----------------
55
- 49 -
"TOTAL INDEBTEDNESS" shall mean, as at any date, the sum, for the Parent
and its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) all Indebtedness and (b) all other
liabilities that should be classified as indebtedness on the Parent's
consolidated balance sheet.
"TOTAL INTEREST COVERAGE RATIO" shall mean, at any date, the ratio of (a)
EBITDA for the then-current Calculation Period to (b) Total Interest Expense for
such period.
"TOTAL INTEREST EXPENSE" shall mean, for any period, the sum, for the
Parent and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of the following: (a) all interest in
respect of Indebtedness (including, without limitation, the interest component
of any payments in respect of Capital Lease Obligations) accrued or capitalized
during such period (whether or not actually paid during such period) PLUS (b)
the net amount payable (or MINUS the net amount receivable) under Interest Rate
Protection Agreements during such period (whether or not actually paid or
received during such period).
"TOTAL LEVERAGE RATIO" shall mean, as at any date of determination, the
ratio of (a) Total Indebtedness as at such date to (b) EBITDA for the period of
four consecutive fiscal quarters of the Parent ending on or most recently ended
prior to such date for which Quarterly Financial Statements have been delivered.
"TRIGGER DATE" shall mean the earlier date as of which:
(a) (i) the ratio of (x) Total Indebtedness as at such date to (y) TTM
EBITDA as at such date shall be less than 3.00 to 1.00, and (ii) the ratio
of (x) TTM EBITDA as at such date to (y) TTM Total Interest Expense as at
such date shall be greater than 3.00 to 1.00; or
Credit Agreement
----------------
56
- 50 -
(b) the senior unsecured, non-credit enhanced debt securities of the
Parent shall be rated Baa3 or better by Xxxxx'x and BBB- or better by
Standard & Poor's.
"TTM EBITDA" shall mean, as at any date, EBITDA for the twelve-month period
ending on such date (if such date is the last day of a calendar month) or on the
last day of the calendar month most recently ended prior to such date.
"TTM TOTAL INTEREST EXPENSE" shall mean, as at any date, Total Interest
Expense for the twelve-month period ending on such date (if such date is the
last day of a calendar month) or on the last day of the calendar month most
recently ended prior to such date.
"TYPE" shall have the meaning assigned to such term in Section 1.03 hereof.
"VOTING STOCK" shall mean, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"WHOLLY OWNED SUBSIDIARY" shall mean, with respect to any Person, any
corporation, partnership or other entity of which all of the equity securities
or other ownership interests (other than, in the case of a corporation,
directors' qualifying shares) are directly or indirectly owned or controlled by
such Person or one or more Wholly Owned Subsidiaries of such Person or by such
Person and one or more Wholly Owned Subsidiaries of such Person.
Credit Agreement
----------------
57
- 51 -
1.02 ACCOUNTING TERMS AND DETERMINATIONS.
(a) Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall (unless otherwise disclosed to the Lenders in writing at the
time of delivery thereof in the manner described in paragraph (b) below) be
prepared, in accordance with generally accepted accounting principles applied on
a basis consistent with those used in the preparation of the latest financial
statements furnished to the Lenders hereunder (which, prior to the delivery of
the first financial statements under Section 9.01 hereof, shall mean the audited
financial statements as at December 31, 1995 referred to in Section 8.02
hereof). All calculations made for the purposes of determining compliance with
this Agreement shall (except as otherwise expressly provided herein) be made by
application of generally accepted accounting principles applied on a basis
consistent with those used in the preparation of the latest annual or quarterly
financial statements furnished to the Lenders pursuant to Section 9.01 hereof
(or, prior to the delivery of the first financial statements under Section 9.01
hereof, used in the preparation of the audited financial statements as at
December 31, 1995 referred to in Section 8.02 hereof) unless (i) the Parent
shall have objected to determining such compliance on such basis at the time of
delivery of such financial statements or (ii) the Majority Lenders shall so
object in writing within 30 days after delivery of such financial statements, in
either of which events such calculations shall be made on a basis consistent
with those used in the preparation of the latest financial statements as to
which such objection shall not have been made (which, if objection is made in
respect of the first financial statements delivered under Section 9.01 hereof,
shall mean the audited financial statements referred to in Section 8.02 hereof).
Credit Agreement
----------------
58
- 52 -
(b) The Parent shall deliver to the Lenders at the same time as the
delivery of any annual or quarterly financial statement under Section 9.01
hereof (i) a description in reasonable detail of any material variation between
the application of accounting principles employed in the preparation of such
statement and the application of accounting principles employed in the
preparation of the next preceding annual or quarterly financial statements as to
which no objection has been made in accordance with the last sentence of
paragraph (a) above and (ii) reasonable estimates of the difference between such
statements arising as a consequence thereof.
(c) On the date hereof, (i) the last day of the fiscal year of Alflex and
each of its Subsidiaries is March 31, and the last days of the first three
fiscal quarters in each of their fiscal years is June 30, September 30 and
December 31, and (ii) the last day of the fiscal year of the Parent and each of
its Subsidiaries (other than Alflex and Alflex's Subsidiaries) is December 31,
and the last days of the first three fiscal quarters in each of their fiscal
years is March 31, June 30 and September 30. To enable the ready and consistent
determination of compliance with the covenants set forth in Section 9 hereof,
(x) as promptly as practicable following the Restatement Effective Date, the
Parent will cause Alflex and each of Alflex's Subsidiaries to change the last
day of their fiscal year to December 31, and to change the last days of the
first three fiscal quarters in each of their fiscal years to March 31, June 30
and September 30, respectively; and (y) except as provided in the preceding
paragraph (x), neither the Parent nor any of its Subsidiaries will change the
last day of its fiscal year or the last days of the first three fiscal quarters
in each of its fiscal years.
1.03 TYPES OF LOANS. Loans hereunder are distinguished by "Type". The
"Type" of a Loan refers to whether such Loan is a Base Rate Loan or a Eurodollar
Loan, each of which constitutes a Type.
Credit Agreement
----------------
59
- 53 -
Section 2. COMMITMENTS, LOANS, NOTES AND PREPAYMENTS.
2.01 LOANS.
(a) TERM LOANS.
(i) On the Restatement Effective Date, the Existing Term Loans held by
the Existing Lenders under the Original Credit Agreement shall
automatically, and without any action on the part of any Person, be
designated as Term Loans owing by Alflex hereunder and each of the New
Lenders that is a Term Loan Lender (and each Existing Lender, if any, whose
relative proportion of Term Loans hereunder is increasing over the
proportion of Existing Term Loans held by it under the Original Credit
Agreement) shall, by assignments from the Existing Lenders (which shall be
deemed to occur automatically on the Restatement Effective Date), acquire a
portion of the Term Loans of the Existing Lenders in such amounts (and the
Lenders shall, through the Administrative Agent, make such additional
adjustments among themselves as shall be necessary) so that after giving
effect to such assignments and adjustments, the Lenders shall hold the Term
Loans hereunder ratably in accordance with their respective Term Loan
Commitments.
(ii) On the Restatement Effective Date all Interest Periods under the
Original Credit Agreement in respect of the Existing Term Loans shall
automatically be terminated, and, from and after the Restatement Effective
Date, Alflex may Convert Term Loans of one Type into Term Loans of another
Type (as provided in Section 2.09 hereof) or Continue Term Loans of one
Type as Term Loans of the same Type (as provided in Section 2.09 hereof).
(b) REVOLVING CREDIT LOANS.
Credit Agreement
----------------
60
- 54 -
(i) On the Restatement Effective Date, the Existing Revolving Credit
Loans held by the Existing Lenders under the Original Credit Agreement
shall automatically, and without any action on the part of any Person, be
designated as Revolving Credit Loans hereunder and each of the New Lenders
that is a Revolving Credit Lender (and each Existing Lender, if any, whose
relative proportion of Revolving Credit Commitments hereunder is increasing
over the proportion of Existing Revolving Credit Loans held by it under the
Original Credit Agreement) shall, by assignments from the Existing Lenders
(which shall be deemed to occur automatically on the Restatement Effective
Date), acquire a portion of the Revolving Credit Loans of the Existing
Lenders in such amounts (and the Revolving Credit Lenders shall, through
the Administrative Agent, make such additional adjustments among themselves
as shall be necessary) so that after giving effect to such assignments and
adjustments, the Revolving Credit Lenders shall hold the Revolving Credit
Loans hereunder ratably in accordance with their respective Revolving
Credit Commitments.
(ii) In addition to the Revolving Credit Loans provided for under
Section 2.01(b)(i) hereof, each Revolving Credit Lender severally agrees,
on the terms and conditions of this Agreement, to make loans to each of
CALI, Alflex and Barmet in Dollars during the Revolving Credit Borrowing
Period in an aggregate principal amount at any one time outstanding (as to
all such Borrowers) up to but not exceeding the amount of the Revolving
Credit Commitment of such Lender as in effect from time to time, PROVIDED
that in no event shall the sum of (x) the aggregate principal amount of all
Revolving Credit Loans (including all Swingline Loans), together with the
aggregate amount of all Letter of Credit Liabilities PLUS (y) the aggregate
amount of the Reserved Commitments exceed the aggregate amount of the
Revolving Credit Commitments as in effect from time to time.
Credit Agreement
----------------
61
- 55 -
(iii) On the Restatement Effective Date, all "Interest
Periods" under the Original Credit Agreement in respect of the Existing
Revolving Credit Loans shall automatically be terminated, and, subject
to the terms and conditions of this
Agreement, during the Revolving Credit Borrowing Period the Revolving
Credit Borrowers may borrow, repay and reborrow the amount of the
Revolving Credit Commitments by means of Base Rate Loans and Eurodollar
Loans and may Convert Revolving Credit Loans of one Type into Revolving
Credit Loans of another Type (as provided in Section 2.09 hereof) or
Continue Revolving Credit Loans of one Type as Revolving Credit Loans
of the same Type (as provided in Section 2.09 hereof).
(c) SWINGLINE LOANS. Subject to the terms and conditions of this Agreement,
in addition to the Revolving Credit Loans provided for in Section 2.01(b)
hereof, the Swingline Lender agrees to make loans ("SWINGLINE LOANS") to the
Revolving Credit Borrowers during the Revolving Credit Borrowing Period. During
the Revolving Credit Borrowing Period, the Revolving Credit Borrowers may
borrow, repay and reborrow Swingline Loans, PROVIDED that the sum of (x) the
aggregate principal amount of all Revolving Credit Loans (including all
Swingline Loans), together with the aggregate amount of all Letter of Credit
Liabilities PLUS (y) the Reserved Commitments, shall not at any time exceed the
aggregate amount of the Revolving Credit Commitments nor shall the aggregate
principal amount of all Swingline Loans exceed $20,000,000. All Swingline Loans
shall be made only as Base Rate Loans and may not be made as or Converted into
Eurodollar Loans.
Upon demand by the Swingline Lender through the Administrative Agent, each
other Lender having a Revolving Credit Commitment shall purchase from the
Swingline Lender, and the Swingline Lender shall sell and assign to each other
such Lender, such other Lender's Revolving Credit Commitment Percentage of each
outstanding Swingline Loan (and related claims for accrued and unpaid interest
thereon) made by such Swingline Lender, by
Credit Agreement
----------------
62
- 56 -
making available for the account of its Applicable Lending Office to the
Administrative Agent for the account of such Swingline Lender by deposit to the
Administrative Agent's Account, in same day funds, an amount equal to the sum of
(x) the portion of the outstanding principal amount of such Swingline Loans to
be purchased by such Lender PLUS (y) interest accrued and unpaid to and as of
such date on such portion of the outstanding principal amount of such Swingline
Loans. Each Lender's obligations to make such payments to the Administrative
Agent for account of the Swingline Lender under this paragraph, and the
Swingline Lender's right to receive the same, shall be absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including, without limitation, the failure of any other Lender to make its
payment under this paragraph, the financial condition of any Obligor, the
existence of any Default, the failure of any of the conditions set forth in
Section 7 hereof to be satisfied, or the termination of all or any of the
Commitments. Each such payment to the Swingline Lender shall be made without any
offset, abatement, withholding or reduction whatsoever. Each Lender agrees to
purchase its Revolving Credit Commitment Percentage of such outstanding
Swingline Loans on (x) the Business Day on which demand therefor is made by such
Swingline Lender, PROVIDED that notice of such demand is given not later than
12:00 noon New York City time on such Business Day or (y) the first Business Day
next succeeding such demand if notice of such demand is given after such time.
Upon any such assignment by the Swingline Lender to any other Lender of a
portion of the Swingline Lender's Swingline Loans, the Swingline Lender
represents and warrants to such other Lender that the Swingline Lender is the
legal and beneficial owner of such interest being assigned by it, but makes no
other representation or warranty and assumes no responsibility with respect to
such Swingline Loan. If and to the extent that any Lender shall not have so made
the amount of such Swingline Loan available to the Administrative Agent, such
Lender agrees to pay to the Administrative Agent for the account of the
Swingline Lender forthwith on demand such amount together with interest thereon,
for each day from the date of demand by the Swingline
Credit Agreement
----------------
63
- 57 -
Lender until the date such amount is paid to the Administrative Agent, at the
Federal Funds Rate.
(d) LIMIT ON EURODOLLAR LOANS. No more than eight separate Interest Periods
in respect of Eurodollar Loans under any Facility from each Lender may be
outstanding at any one time.
2.02 BORROWINGS. Each Borrower shall give the Administrative Agent (or, in
the case of Swingline Loans, shall give the Swingline Lender) notice of each
borrowing by it hereunder as provided in Section 4.05 hereof. Not later than
1:00 p.m. New York time on the date specified for each borrowing hereunder, each
Lender shall make available the amount of the Loan or Loans to be made by it on
such date to the Administrative Agent, at an account specified by the
Administrative Agent, in immediately available funds, for account of the
relevant Borrower. The amount so received by the Administrative Agent shall,
subject to the terms and conditions of this Agreement, promptly be made
available to the relevant Borrower by depositing the same, in immediately
available funds, in an account of such Borrower designated by such Borrower.
2.03 LETTERS OF CREDIT.
(a) Subject to the terms and conditions of this Agreement, the Revolving
Credit Commitments may be utilized, upon the request of the relevant Revolving
Credit Borrower, in addition to the Revolving Credit Loans to such Borrower
provided for by Section 2.01 hereof, by the issuance by the Issuing Banks of
letters of credit (collectively, "LETTERS OF CREDIT") for account of such
Borrower or any of its Subsidiaries (as specified by such Borrower), PROVIDED
that in no event shall:
(i) the sum of (x) the aggregate amount of all Letter of Credit
Liabilities, together with the aggregate principal amount of the Revolving
Credit Loans (including all Swingline Loans) PLUS (y) the Reserved
Commitments, exceed
Credit Agreement
----------------
64
- 58 -
the aggregate amount of the Revolving Credit Commitments as in effect from
time to time;
(ii) the outstanding aggregate amount of all Letter of Credit
Liabilities exceed $30,000,000; and
(iii) the expiration date of any Letter of Credit extend beyond the
earlier of the date five Business Days prior to the Commitment Termination
Date and the date twelve months following the issuance of such Letter of
Credit.
In addition, on the Restatement Effective Date, all "Letters of Credit"
outstanding under the Original Credit Agreement on the Restatement Effective
Date shall automatically, without any action on the part of any Person, become
Letters of Credit outstanding hereunder.
(b) The following additional provisions shall apply to Letters of Credit:
(i) The relevant Revolving Credit Borrower shall give the
Administrative Agent at least three Business Days' irrevocable prior notice
(effective upon receipt) specifying the Business Day (which shall be no
later than 30 days preceding the Commitment Termination Date) each Letter
of Credit is to be issued, the Issuing Bank to issue the same and the
account party or parties therefor and describing in reasonable detail the
proposed terms of such Letter of Credit (including the beneficiary thereof)
and the nature of the transactions or obligations proposed to be supported
thereby (including whether such Letter of Credit is to be a commercial
letter of credit or a standby letter of credit). Upon receipt of any such
notice, the Administrative Agent shall advise the relevant Issuing Bank of
the contents thereof.
(ii) On each day during the period commencing with the issuance by an
Issuing Bank of any Letter of Credit and
Credit Agreement
----------------
65
- 59 -
until such Letter of Credit shall have expired or been terminated, the
Revolving Credit Commitment of each Lender shall be deemed to be utilized
for all purposes of this Agreement in an amount equal to such Lender's
Revolving Credit Commitment Percentage of the then undrawn face amount of
such Letter of Credit. Each Revolving Credit Lender (other than the
relevant Issuing Bank) agrees that, upon the issuance of any Letter of
Credit hereunder, it shall automatically acquire a participation in such
Issuing Bank's liability under such Letter of Credit in an amount equal to
such Lender's Revolving Credit Commitment Percentage of such liability, and
each Revolving Credit Lender (other than such Issuing Bank) thereby shall
absolutely, unconditionally and irrevocably assume, as primary obligor and
not as surety, and shall be unconditionally obligated to such Issuing Bank
to pay and discharge when due, its Revolving Credit Commitment Percentage
of such Issuing Bank's liability under such Letter of Credit.
(iii) Upon receipt from the beneficiary of any Letter of Credit of any
demand for payment under such Letter of Credit, the relevant Issuing Bank
shall promptly notify the relevant Borrower (through the Administrative
Agent) of the amount to be paid by such Issuing Bank as a result of such
demand and the date on which payment is to be made by such Issuing Bank to
such beneficiary in respect of such demand. Notwithstanding the identity of
the account party of any Letter of Credit, the relevant Borrower hereby
unconditionally agrees to pay and reimburse the Administrative Agent for
account of such Issuing Bank for the amount of each demand for payment
under such Letter of Credit that is in substantial compliance with the
provisions of such Letter of Credit at or prior to the date on which
payment is to be made by such Issuing Bank to the beneficiary thereunder,
without presentment, demand, protest or other formalities of any kind.
Credit Agreement
----------------
66
- 60 -
(iv) Forthwith upon its receipt of a notice referred to in paragraph
(iii) of this Section 2.03(b), the relevant Borrower shall advise the
Administrative Agent whether or not such Borrower intends to borrow
hereunder to finance its obligation to reimburse the relevant Issuing Bank
for the amount of the related demand for payment and, if it does, submit a
notice of such borrowing as provided in Section 4.05 hereof.
(v) Each Revolving Credit Lender (other than the relevant Issuing
Bank) shall pay to the Administrative Agent for account of such Issuing
Bank at an account specified by the Administrative Agent in Dollars and in
immediately available funds, the amount of such Lender's Revolving Credit
Commitment Percentage of any payment under a Letter of Credit upon notice
by such Issuing Bank (through the Administrative Agent) to such Revolving
Credit Lender requesting such payment and specifying such amount. Each such
Revolving Credit Lender's obligation to make such payment to the
Administrative Agent for account of such Issuing Bank under this paragraph
(v), and such Issuing Bank's right to receive the same, shall be absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including, without limitation, the failure of any other Revolving Credit
Lender to make its payment under this paragraph (v), the financial
condition of the relevant Borrower (or any other account party or Obligor),
the existence of any Default or the termination of any of the Commitments.
Each such payment to an Issuing Bank shall be made without any offset,
abatement, withholding or reduction whatsoever. If any Revolving Credit
Lender shall default in its obligation to make any such payment to the
Administrative Agent for account of such Issuing Bank, for so long as such
default shall continue the Administrative Agent may at the request of such
Issuing Bank withhold from any payments received by the Administrative
Agent under this Agreement or any Note for account of such Revolving Credit
Lender the amount so in default and, to the extent so
Credit Agreement
----------------
67
- 61 -
withheld, pay the same to such Issuing Bank in satisfaction of such
defaulted obligation.
(vi) Upon the making of each payment by a Revolving Credit Lender to
an Issuing Bank pursuant to paragraph (v) above in respect of any Letter of
Credit, such Lender shall, automatically and without any further action on
the part of the Administrative Agent, such Issuing Bank or such Lender,
acquire (x) a participation in an amount equal to such payment in the
Reimbursement Obligation owing to such Issuing Bank by the relevant
Borrower hereunder and under the Letter of Credit Documents relating to
such Letter of Credit and (y) a participation in a percentage equal to such
Lender's Revolving Credit Commitment Percentage in any interest or other
amounts payable by the relevant Borrower hereunder and under such Letter of
Credit Documents in respect of such Reimbursement Obligation (other than
the commissions, charges, costs and expenses payable to such Issuing Bank
pursuant to paragraph (vii) of this Section 2.03(b)). Upon receipt by an
Issuing Bank from or for account of the relevant Borrower of any payment in
respect of any Reimbursement Obligation or any such interest or other
amount (including by way of setoff or application of proceeds of any
collateral security) such Issuing Bank shall promptly pay to the
Administrative Agent for account of each Revolving Credit Lender entitled
thereto, such Revolving Credit Lender's Revolving Credit Commitment
Percentage of such payment, each such payment by such Issuing Bank to be
made in the same money and funds in which received by such Issuing Bank. In
the event any payment received by an Issuing Bank and so paid to the
relevant Revolving Credit Lenders hereunder is rescinded or must otherwise
be returned by such Issuing Bank, each Revolving Credit Lender shall, upon
the request of such Issuing Bank (through the Administrative Agent), repay
to such Issuing Bank (through the Administrative Agent) the amount of such
payment paid to such Lender, with interest at the rate specified in
paragraph (x) of this Section 2.03(b).
Credit Agreement
----------------
68
- 62 -
(vii) The Revolving Credit Borrowers shall pay to the Administrative
Agent for account of each Revolving Credit Lender (ratably in accordance
with their respective Revolving Credit Commitment Percentages) a letter of
credit fee in respect of each Letter of Credit in an amount equal to the
Applicable Letter of Credit Percentage per annum of the daily average
undrawn face amount of such Letter of Credit for the period from and
including the date of issuance of such Letter of Credit (x) in the case of
a Letter of Credit that expires in accordance with its terms, to and
including such expiration date and (y) in the case of a Letter of Credit
that is drawn in full or is otherwise terminated other than on the stated
expiration date of such Letter of Credit, to but excluding the date such
Letter of Credit is drawn in full or is terminated (such fee to be
non-refundable, to be paid in arrears on each Quarterly Date and on the
Commitment Termination Date and to be calculated for any day after giving
effect to any payments made under such Letter of Credit on such day). In
addition, the Revolving Credit Borrowers shall pay to the Administrative
Agent for account of each Issuing Bank a fronting fee in respect of each
Letter of Credit issued by such Issuing Bank in an amount equal to 0.25%
per annum of the daily average undrawn face amount of such Letter of Credit
for the period from and including the date of issuance of such Letter of
Credit (x) in the case of a Letter of Credit that expires in accordance
with its terms, to and including such expiration date and (y) in the case
of a Letter of Credit that is drawn in full or is otherwise terminated
other than on the stated expiration date of such Letter of Credit, to but
excluding the date such Letter of Credit is drawn in full or is terminated
(such fee to be non-refundable, to be paid in arrears on each Quarterly
Date and on the Commitment Termination Date and to be calculated for any
day after giving effect to any payments made under such Letter of Credit on
such day) plus all commissions, charges, costs and expenses in the amounts
customarily charged by such Issuing
Credit Agreement
----------------
69
- 63 -
Bank from time to time in like circumstances with respect to the issuance
of each Letter of Credit and drawings and other transactions relating
thereto.
(viii) Promptly following the end of each calendar month, each Issuing
Bank shall deliver (through the Administrative Agent) to each Revolving
Credit Lender and each Revolving Credit Borrower a notice describing the
aggregate amount of all Letters of Credit outstanding at the end of such
month. Upon the request of any Revolving Credit Lender from time to time,
each Issuing Bank shall deliver any other information reasonably requested
by such Lender with respect to each Letter of Credit then outstanding.
(ix) The issuance by an Issuing Bank of a Letter of Credit shall, in
addition to the conditions precedent set forth in Section 7 hereof, be
subject to the conditions precedent that (x) such Letter of Credit shall be
in such form, contain such terms and support such transactions as shall be
satisfactory to such Issuing Bank consistent with its then current
practices and procedures with respect to letters of credit of the same type
and (y) the relevant Revolving Credit Borrower shall have executed and
delivered such applications, agreements and other instruments relating to
such Letter of Credit as such Issuing Bank shall have reasonably requested
consistent with its then current practices and procedures with respect to
letters of credit of the same type, PROVIDED that in the event of any
conflict between any such application, agreement or other instrument and
the provisions of this Agreement or any Security Document, the provisions
of this Agreement and the Security Documents shall control.
(x) To the extent that any Lender shall fail to pay any amount
required to be paid pursuant to paragraph (v) or (vi) of this Section
2.03(b) on the due date therefor, such Lender shall pay interest to the
relevant Issuing Bank (through the Administrative Agent) on such amount
from and
Credit Agreement
----------------
70
- 64 -
including such due date to but excluding the date such payment is made at a
rate per annum equal to the Federal Funds Rate, PROVIDED that if such
Lender shall fail to make such payment to such Issuing Bank within three
Business Days of such due date, then, retroactively to the due date, such
Lender shall be obligated to pay interest on such amount at the
Post-Default Rate.
(xi) The issuance by an Issuing Bank of any modification or supplement
to any Letter of Credit hereunder shall be subject to the same conditions
applicable under this Section 2.03 to the issuance of new Letters of
Credit, and no such modification or supplement shall be issued hereunder
unless either (x) the respective Letter of Credit affected thereby would
have complied with such conditions had it originally been issued hereunder
in such modified or supplemented form or (y) each Revolving Credit Lender
shall have consented thereto.
Each Revolving Credit Borrower hereby indemnifies and holds harmless each
Revolving Credit Lender and the Administrative Agent from and against any and
all claims and damages, losses, liabilities, costs or expenses that such Lender
or the Administrative Agent may incur (or that may be claimed against such
Lender or the Administrative Agent by any Person whatsoever) by reason of or in
connection with the execution and delivery or transfer of or payment or refusal
to pay by an Issuing Bank under any Letter of Credit issued by such Issuing
Bank; PROVIDED that such Borrower shall not be required to indemnify any Lender
or the Administrative Agent for any claims, damages, losses, liabilities, costs
or expenses to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of such Issuing Bank in determining whether a
request presented under any Letter of Credit complied with the terms of such
Letter of Credit or (y) in the case of such Issuing Bank, such Lender's failure
to pay under any Letter of Credit after the presentation to it of a request
strictly complying with the terms and conditions of such Letter of Credit.
Nothing in this
Credit Agreement
----------------
71
- 65 -
Section 2.03 is intended to limit the other obligations of any
Borrower, any Lender or the Administrative Agent under this Agreement.
2.04 CHANGES OF COMMITMENTS.
(a) EXPIRATION OF COMMITMENTS. Any portion of the Term Loan Commitments not
utilized on the Restatement Effective Date shall terminate automatically at the
close of business on the Restatement Effective Date. The Revolving Credit
Commitments shall be automatically reduced to zero on the Commitment Termination
Date.
(b) REDUCTIONS OF COMMITMENTS. Each Borrower shall have the right at any
time or from time to time (i) to reduce the aggregate unused amount of the
Commitments under its Facilities (for which purpose use of Revolving Credit
Commitments shall be deemed to include the aggregate amount of Swingline Loans
and Letter of Credit Liabilities) and (ii) in the case of the Revolving Credit
Borrowers, so long as no Loans (including all Swingline Loans) or Letter of
Credit Liabilities are outstanding, to terminate the Revolving Credit
Commitments; PROVIDED that (x) the relevant Borrower shall give notice of each
such termination or reduction as provided in Section 4.05 hereof and (y) each
partial reduction shall be in an aggregate amount at least equal to $5,000,000
(or a larger multiple of $1,000,000).
(c) GENERAL. The Commitments under any Facility once terminated or reduced
may not be reinstated.
Credit Agreement
----------------
72
- 66 -
2.05 CERTAIN FEES.
(a) The Revolving Credit Borrowers shall pay to the Administrative Agent
for account of each Lender a fee ("NON-UTILIZATION FEES") on the daily average
unused amount of such Lender's Revolving Credit Commitment (for which purpose
(i) the Reserved Commitments shall be deemed not to constitute usage of such
Lender's Revolving Credit Commitment and (ii) the aggregate amount of any Letter
of Credit Liabilities shall be deemed to be a pro rata (based on the Revolving
Credit Commitments) use of each Lender's Revolving Credit Commitment), for the
period from and including the Signing Date to but not including the earlier of
the date such Revolving Credit Commitment is terminated and the Commitment
Termination Date, at a rate per annum equal to the Applicable Non-Utilization
Fee Percentage in effect from time to time.
(b) Accrued Non-Utilization Fee shall be payable on each Quarterly Date and
on the earlier of the date the Revolving Credit Commitments are terminated and
the Commitment Termination Date.
(c) Notwithstanding anything to the contrary contained herein or in the
Original Credit Agreement, the accrued fees payable under Section 2.05 of the
Original Credit Agreement shall be payable on the Restatement Effective Date.
2.06 LENDING OFFICES. The Loans of each Type made by each Lender shall be
made and maintained at such Lender's Applicable Lending Office for Loans of such
Type.
2.07 SEVERAL OBLIGATIONS; REMEDIES INDEPENDENT. The
failure of any Lender to make any Loan to be made by it on the
date specified therefor shall not relieve any other Lender of its
obligation to make its Loan on such date, but neither any Lender
nor the Administrative Agent shall be responsible for the failure
of any other Lender to make a Loan to be made by such other
Credit Agreement
----------------
73
- 67 -
Lender, and (except as otherwise provided in Section 4.06 hereof) no Lender
shall have any obligation to the Administrative Agent or any other Lender for
the failure by such Lender to make any Loan required to be made by such Lender.
The amounts payable by each Borrower at any time hereunder and under the Notes
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 the
Notes, and it shall not be necessary for any other Lender or the Administrative
Agent to consent to, or be joined as an additional party in, any proceedings for
such purposes.
2.08 NOTES.
(a) PROMISSORY NOTES. The Loans made by each Lender under each Facility
shall be evidenced by a single promissory note of each relevant Borrower
substantially in the form of the Exhibit hereto identified below opposite the
name of such Facility:
Facility Exhibit
-------- -------
Term Loan Facility Exhibit A-1
Revolving Credit Facility Exhibit A-2
Swingline Facility Exhibit A-3
Each Note shall be dated the Restatement Effective Date, payable to such Lender
in a principal amount equal to the amount of its Commitment under the relevant
Facility as in effect on the Restatement Effective Date and otherwise duly
completed. The Swingline Note evidencing the Swingline Loans made by the
Swingline Lender shall be dated the Restatement Effective Date, payable to the
Swingline Lender in a principal amount equal to $20,000,000 and otherwise duly
completed.
(b) RECORDATION OF LOANS, ETC. The date, amount, Type, interest rate and
duration of Interest Period (if applicable) of each Loan under each Facility
made by each Lender
Credit Agreement
----------------
74
- 68 -
to the relevant Borrower, and each payment made on account of the principal
thereof, shall be recorded by such Lender on its books and, prior to any
transfer of the Note evidencing the Loans under such Facility held by it,
endorsed by such Lender on the schedule attached to such Note or any
continuation thereof; PROVIDED that the failure of such Lender to make any such
recordation or endorsement shall not affect the obligations of the relevant
Borrower to make a payment when due of any amount owing hereunder or under such
Note in respect of such Loans.
(c) SUBSTITUTION, EXCHANGE, SUBDIVISION, ETC. No Lender shall be entitled
to have its Notes substituted or exchanged for any reason, or subdivided for
promissory notes of lesser denominations, except in connection with a permitted
assignment of all or any portion of such Lender's relevant Commitments, Loans
and Notes pursuant to Section 12.06 hereof (and, if requested by any Lender,
each Borrower agrees to so exchange any Note).
2.09 OPTIONAL PREPAYMENTS AND CONVERSIONS OR CONTINUATIONS OF LOANS.
Subject to Section 4.04 hereof, each Borrower shall have the right to prepay
Loans, to Convert Loans of one Type under one Facility into Loans of another
Type under the same Facility or to Continue Loans of one Type under one Facility
as Loans of the same Type under the same Facility, at any time or from time to
time, PROVIDED that:
(a) such Borrower shall give the Administrative Agent (or, in the case
of Swingline Loans, shall give the Swingline Lender) notice of each such
prepayment, Conversion or Continuation as provided in Section 4.05 hereof
(and, upon the date specified in any such notice of prepayment, the amount
to be prepaid shall become due and payable hereunder);
(b) any such prepayment or Conversion of a Eurodollar Loan other than
on the last day of an Interest Period therefor shall be accompanied by, and
subject to, the
Credit Agreement
----------------
75
- 69 -
payment of any amount payable under Section 5.05 hereof in respect of such
prepayment or Conversion;
(c) prepayments of Loans under the Term Loan Facility shall be applied
FIRST in the direct order of maturity of the installments of such Loans
falling due within one year from the date of prepayment and THEN ratably to
the remaining installments of such Loans; and
(d) any Conversion or Continuation of Eurodollar Loans shall be
subject to the provisions of Section 2.01(d) hereof.
Notwithstanding the foregoing, and without limiting the rights and remedies of
the Lenders under Section 10 hereof, in the event that any Event of Default
shall have occurred and be continuing, the Administrative Agent may (and at the
request of the Majority Lenders shall) suspend the right of the Borrowers to
Convert any Loan into a Eurodollar Loan, or to Continue any Loan as a Eurodollar
Loan, in which event all Loans shall be Converted (on the last day(s) of the
respective Interest Periods therefor) or Continued, as the case may be, as Base
Rate Loans.
2.10 MANDATORY PREPAYMENTS AND REDUCTIONS OF COMMITMENTS.
(a) BORROWING BASE. The Revolving Credit Borrowers shall from time to time
prepay the Loans (and/or provide cover for Letter of Credit Liabilities as
specified in paragraph (i) below) under the Revolving Credit Facility, in each
case in such amounts as shall be necessary so that at all times the aggregate
outstanding amount of the Revolving Credit Loans (including all Swingline Loans)
together with the outstanding Letter of Credit Liabilities shall not exceed the
Borrowing Base, such amount to be applied, FIRST, to Loans outstanding under the
Revolving Credit Facility and, SECOND, as cover for outstanding Letter of Credit
Liabilities.
Credit Agreement
----------------
76
- 70 -
(b) SALE OF ASSETS. Without limiting the obligation of the Borrowers to
obtain the consent of the Majority Lenders pursuant to Section 9.05 hereof to
any Disposition not otherwise permitted hereunder, no later than five Business
Days after each Recapture Date the Parent shall deliver to the Administrative
Agent a certificate of a Responsible Officer of the Parent in form and detail
reasonably satisfactory to the Administrative Agent of the amount of Net
Available Proceeds for the Recapture Period ending on such Recapture Date and,
on the date five Business Days after such Recapture Date the Borrowers shall
prepay the Loans (and/or provide cover for Letter of Credit Liabilities as
specified in paragraph (i) below), and the Commitments shall be subject to
automatic reduction, in an aggregate amount equal to 100% (or, from and after
the Trigger Date, 75%) of the Net Available Proceeds of Dispositions for such
Recapture Period, such prepayment and reduction to be effected in each case in
the manner, order and to the extent specified in paragraph (h) below.
Notwithstanding the foregoing, the Borrowers shall not be required to make
a prepayment pursuant to this paragraph (b) with respect to the Net Available
Proceeds of any Disposition in the event that the Borrowers advise the
Administrative Agent at the time the Net Available Proceeds from such
Disposition are received that they intend to reinvest such Net Available
Proceeds in replacement assets pursuant to a transaction permitted hereunder, so
long as:
(x) such Net Available Proceeds are held by the Administrative Agent
in the Collateral Account pending such reinvestment, in which event the
Administrative Agent need not release such Net Available Proceeds except
upon presentation of evidence satisfactory to it that such Net Available
Proceeds are to be so reinvested in compliance with the provisions of this
Agreement,
(y) the Net Available Proceeds from any Disposition are in fact so
reinvested within twelve months of such
Credit Agreement
----------------
77
- 71 -
Disposition (it being understood that, in the event Net Available Proceeds
from more than one Disposition are paid into the Collateral Account as
provided in clause (x) above, such Net Available Proceeds shall be deemed
to be released in the same order in which such Dispositions occurred and,
accordingly, any such Net Available Proceeds so held for more than twelve
months shall be forthwith applied to the prepayment of Loans and reductions
of Commitments as provided above), and
(z) the aggregate amount of Net Available Proceeds (together with
investment earnings thereon) so held at any time by the Administrative
Agent pending reinvestment as contemplated by this sentence shall not at
any time exceed $10,000,000 or such greater amount as the Majority Lenders
may otherwise agree.
As contemplated by Section 4.01 of the Pledge and Security Agreement, nothing in
this Section 2.10(b) shall be deemed to obligate the Administrative Agent to
release any of such proceeds from the Collateral Account to the Borrowers upon
the occurrence and during the continuance of any Event of Default.
Credit Agreement
----------------
78
- 72 -
(c) CASUALTY EVENTS. Upon the date twelve months following the receipt by
the Parent or any of its Subsidiaries (the date of such receipt being the
"RECEIPT DATE") of the proceeds of insurance, condemnation award or other
compensation in respect of any Casualty Event affecting any Property of the
Parent or any of its Subsidiaries, the Parent shall cause the Borrowers to
prepay the Loans (and/or provide cover for Letter of Credit Liabilities as
specified in paragraph (i) below), and the Commitments shall be subject to
automatic reduction, in an aggregate amount, if any, equal to 100% (or, from and
after the Trigger Date, 75%) of the Net Available Proceeds of such Casualty
Event to the extent that all or substantially all of such Net Available Proceeds
have not theretofore been applied to the repair or replacement of such Property,
such prepayment and reduction to be effected in each case in the manner and to
the extent specified in paragraph (h) below. Notwithstanding the foregoing:
(i) the Parent shall cause such prepayment and reduction to occur (x)
upon the date 30 days after the Receipt Date (if the Parent or such
Subsidiary shall not theretofore have determined to repair or replace the
Property affected by such Casualty Event) and (y) upon the date 90 days
after the Receipt Date (if the Parent or such Subsidiary shall not
theretofore have commenced the repair or replacement of such Property); and
(ii) in the event that a Casualty Event shall occur with respect to
Property covered by any Mortgage, the Parent shall cause the Borrowers to
prepay the Loans (and/or provide cover for Letter of Credit Liabilities as
specified in paragraph (i) below), and the Commitments shall be subject to
automatic reduction, on the dates, and in the amounts of the required
prepayments, specified in such Mortgage.
Credit Agreement
----------------
79
- 73 -
Nothing in this paragraph (c) shall be deemed to limit any obligation of the
Parent or any of its Subsidiaries pursuant to any of the Security Documents to
remit to a collateral or similar account (including, without limitation, the
Collateral Account) maintained by the Administrative Agent pursuant to any of
the Security Documents the proceeds of insurance, condemnation award or other
compensation received in respect of any Casualty Event.
(d) DEBT ISSUANCE. Upon any Debt Issuance occurring prior to the Trigger
Date, the Parent shall cause the Borrowers to prepay the Loans (and/or provide
cover for Letter of Credit Liabilities as specified in paragraph (i) below), and
the Commitments shall be subject to automatic reduction, in an aggregate amount
equal to 100% of the Net Available Proceeds thereof, such prepayment and
reduction to be effected in each case in the manner and to the extent specified
in paragraph (h) below.
(e) EQUITY ISSUANCE. Upon any Equity Issuance occurring prior to the
Trigger Date, the Parent shall cause the Borrowers to prepay the Loans (and/or
provide cover for Letter of Credit Liabilities as specified in paragraph (i)
below), and the Commitments shall be subject to automatic reduction, in an
aggregate amount equal to 75% of the Net Available Proceeds thereof, such
prepayment and reduction to be effected in each case in the manner and to the
extent specified in paragraph (h) below.
(f) CHANGE OF CONTROL. If any Change of Control shall occur, then,
concurrently with such Change of Control, the Borrowers shall prepay the Loans
in full and the Commitments shall be automatically reduced to zero.
(g) RECEIVABLES SALES. Without limiting the obligation of the Borrowers to
obtain the consent of the Majority Lenders pursuant to Section 9.05 hereof to
any Receivables Sale not otherwise permitted hereunder, upon any Receivables
Sale the Parent shall cause the Borrowers to prepay the Loans (and/or
Credit Agreement
----------------
80
- 74 -
provide cover for Letter of Credit Liabilities as specified in paragraph (i)
below) in an aggregate amount equal to 100% of the Net Available Proceeds
thereof (as to each such Receivables Sale, the "PREPAYMENT AMOUNT"). Each such
prepayment pursuant to this Section 2.10(g) shall be applied FIRST to the
prepayment of outstanding Swingline Loans, SECOND to the prepayment of Revolving
Credit Loans, THIRD to provide cover for Letter of Credit Liabilities as
specified in paragraph (i) below and FOURTH to the prepayment of outstanding
Term Loans.
(h) APPLICATION. Prepayments and reductions of Commitments described in the
above paragraphs of this Section 2.10 (other than in paragraphs (a) and (g)
above) shall be effected as follows:
(i) FIRST, the amount of the prepayment specified in such paragraphs
shall be applied to the Term Loans then outstanding (to the installments
thereof in inverse order of maturity); and
(ii) SECOND, the Revolving Credit Commitments shall be automatically
reduced in an amount equal to any excess over the amount referred to in the
foregoing clause (i) (and to the extent that, after giving effect to such
reduction, the sum of (I) the aggregate principal amount of Loans
(including all Swingline Loans), together with the aggregate amount of all
Letter of Credit Liabilities, under the Revolving Credit Facility PLUS (II)
the aggregate amount of the Reserved Commitments would exceed the Revolving
Credit Commitments, the Revolving Credit Borrowers shall, first, prepay
Swingline Loans, second, prepay the other Revolving Credit Loans, and,
third, provide cover for Letter of Credit Liabilities as specified in
paragraph (i) below, in an aggregate amount equal to such excess).
(i) COVER FOR LETTER OF CREDIT LIABILITIES. In the event that a Revolving
Credit Borrower shall be required pursuant to this Section 2.10 to provide cover
for Letter of Credit
Credit Agreement
----------------
81
- 75 -
Liabilities, such Borrower shall effect the same by paying to the Administrative
Agent immediately available funds in an amount equal to the required amount,
which funds shall be retained by the Administrative Agent in the Collateral
Account (as provided therein as collateral security in the first instance for
such Letter of Credit Liabilities) until such time as the Letters of Credit
shall have been terminated and all of the Letter of Credit Liabilities paid in
full.
2.11 RESERVED COMMITMENTS, ETC.
(a) If the Borrowers shall at any time prepay Revolving Credit Loans with
Net Available Proceeds of any Receivables Sale in accordance with Section
2.10(g) hereof, then an amount of Revolving Credit Commitments equal to the
amount of such prepayment shall be reserved and shall not, except as provided in
paragraph (b) below, be available for borrowings or reborrowings of Revolving
Credit Loans under Section 2.01(b) hereof. The Revolving Credit Commitments at
any time so reserved are herein called the "RESERVED COMMITMENTS"; the Revolving
Credit Commitments not constituting Reserved Commitments are herein called the
"AVAILABLE COMMITMENTS".
(b) The Parent may from time to time deliver to the Administrative Agent a
request (an "AVAILABILITY INCREASE REQUEST") to reduce the aggregate amount of
the Reserved Commitments (and, thereby, to increase the aggregate amount of the
Available Commitments). Each Availability Increase Request shall state the
aggregate amount of the proposed reduction in the Reserved Commitments and the
date on which such reduction is to become effective (which date shall be a
Business Day no earlier than the date three Business Days following the delivery
of such Availability Increase Request), and shall be accompanied by a
certificate of a Responsible Officer of the Parent in form and detail
satisfactory to the Administrative Agent demonstrating that the amount of the
Reserved Commitments (after giving effect to the reduction thereof requested in
such Availability Increase Request) shall be not less than the aggregate amount
then
Credit Agreement
----------------
82
- 76 -
outstanding under all Permitted Receivable Financings. On the effective date
specified in each Availability Increase Request, the amount of the Reserved
Commitments shall be reduced automatically by the amount specified in such
Availability Increase Request.
(c) Notwithstanding anything in this Agreement to the contrary, reductions
of the Revolving Credit Commitments hereunder (including, without limitation,
reductions under Sections 2.04(b) and 2.10 hereof) shall be applied FIRST to the
Reserved Commitments and THEN to the Available Commitments.
Section 3. PAYMENTS OF PRINCIPAL AND INTEREST.
3.01 REPAYMENT OF LOANS.
(a) TERM LOANS. Alflex hereby promises to pay to the Administrative Agent
for account of each Lender the entire outstanding principal amount of such
Lender's Term Loans in 20 installments payable on the Principal Payment Dates as
follows:
Principal Payment Date
Falling on or Nearest To Amount of Installment
------------------------ ---------------------
December 1, 1996 $1,250,000.00
March 1, 1997 $1,250,000.00
June 1, 1997 $1,250,000.00
September 1, 1997 $1,250,000.00
December 1, 1997 $2,500,000.00
March 1, 1998 $2,500,000.00
June 1, 1998 $2,500,000.00
September 1, 1998 $2,500,000.00
December 1, 1998 $5,000,000.00
March 1, 1999 $5,000,000.00
June 1, 1999 $5,000,000.00
September 1, 1999 $5,000,000.00
December 1, 1999 $7,500,000.00
Credit Agreement
----------------
83
- 77 -
March 1, 2000 $7,500,000.00
June 1, 2000 $7,500,000.00
September 1, 2000 $7,500,000.00
December 1, 2000 $8,750,000.00
March 1, 2001 $8,750,000.00
June 1, 2001 $8,750,000.00
September 1, 2001 $8,750,000.00
(b) REVOLVING CREDIT FACILITY. Each Revolving Credit Borrower hereby
jointly and severally promises to pay to the Administrative Agent for account of
each Lender the entire outstanding principal amount of such Lender's Revolving
Credit Loans, and each such Loan shall mature, on the Commitment Termination
Date.
(c) SWINGLINE LOANS. The Revolving Credit Borrowers hereby jointly and
severally promise to pay to the Administrative Agent for account of the
Swingline Lender (or each other Lender holding a Swingline Loan) the entire
outstanding principal amount of the Swingline Loans, and each such Loan shall
mature, on the Commitment Termination Date.
3.02 INTEREST. Each Borrower hereby promises to pay to the Administrative
Agent for account of each Lender interest on the unpaid principal amount of each
Loan (including each Swingline Loan) made by such Lender to such Borrower for
the period from and including the date of such Loan to but excluding the date
such Loan shall be paid in full, at the following rates per annum:
(a) during such periods as such Loan is a Base Rate Loan, the Base
Rate (as in effect from time to time) PLUS the Applicable Margin and
(b) during such periods as such Loan is a Eurodollar Loan, for each
Interest Period relating thereto, the Eurodollar Rate for such Loan for
such Interest Period PLUS the Applicable Margin.
Credit Agreement
----------------
84
- 78 -
Notwithstanding the foregoing, each Borrower hereby promises to pay to the
Administrative Agent for account of each Lender interest at the applicable
Post-Default Rate:
(x) on any principal of any Loan made by such Lender to such Borrower,
on any Reimbursement Obligation of such Borrower held by such Lender and on
any other amount payable by such Borrower hereunder or under the Notes held
by such Lender to or for account of such Lender, that shall not be paid in
full when due (whether at stated maturity, by acceleration, by mandatory
prepayment or otherwise), for the period from and including the due date
thereof to but excluding the date the same is paid in full; and
(y) during any Specified Event of Default Period.
Accrued interest on each Loan shall be payable (i) in the case of a Base Rate
Loan and a Swingline Loan, quarterly on the Quarterly Dates, (ii) in the case of
a Eurodollar Loan, on the last day of each Interest Period therefor and, if such
Interest Period is longer than three months, at three-month intervals following
the first day of such Interest Period, and (iii) in the case of any Loan (other
than a Swingline Loan), upon the payment or prepayment thereof or the Conversion
of such Loan to a Loan of another Type (but only on the principal amount so
paid, prepaid or Converted), except that interest payable at the Post-Default
Rate shall be payable from time to time on demand. Promptly after the
determination of any interest rate provided for herein or any change therein,
the Administrative Agent shall give notice thereof to the Lenders to which such
interest is payable and to the Borrowers.
Notwithstanding anything to the contrary contained herein or in the
Original Credit Agreement, accrued interest payable under Section 3.02 of the
Original Credit Agreement with respect to any of the "Loans" outstanding
thereunder shall be paid on the Restatement Effective Date.
Credit Agreement
----------------
85
- 79 -
Section 4. PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC.
4.01 PAYMENTS.
(a) Except to the extent otherwise provided herein, all payments of
principal, interest, Reimbursement Obligations and other amounts to be made by
the Borrowers under this Agreement and the Notes, and, except to the extent
otherwise provided therein, all payments to be made by the Obligors under any
other Credit Document, shall be made in Dollars, in immediately available funds,
without deduction, set-off or counterclaim, to the Administrative Agent at an
account specified by the Administrative Agent, not later than 1:00 p.m. New York
time on the date on which such payment shall become due (each such payment made
after such time on such due date to be deemed to have been made on the next
succeeding Business Day).
(b) Any Lender for whose account any such payment by a Borrower is to be
made may (but shall not be obligated to) debit the amount of any such payment
that is not made by such time to any ordinary deposit account of such Borrower
with such Lender (with notice to such Borrower and the Administrative Agent),
PROVIDED that such Lender's failure to give such notice shall not affect the
validity thereof.
(c) Each Borrower shall, at the time of making each payment under this
Agreement or any Note for account of any Lender, specify to the Administrative
Agent (which shall so notify the intended recipient(s) thereof) the Loans,
Reimbursement Obligations or other amounts payable by such Borrower hereunder to
which such payment is to be applied (and in the event that such Borrower fails
to so specify, or if an Event of Default has occurred and is continuing, the
Administrative Agent may distribute such payment to the Lenders for application
Credit Agreement
----------------
86
- 80 -
in such manner as it or the Majority Lenders, subject to Section 4.02 hereof,
may determine to be appropriate).
(d) Except to the extent otherwise provided in the last sentence of Section
2.03(b)(v) hereof, each payment received by the Administrative Agent under this
Agreement or any Note for account of any Lender shall be paid by the
Administrative Agent promptly to such Lender, in immediately available funds,
for account of such Lender's Applicable Lending Office for the Loan or other
obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement or any Note would
otherwise fall on a day that is not a Business Day, such date shall be extended
to the next succeeding Business Day, and interest shall be payable for any
principal so extended for the period of such extension.
4.02 PRO RATA TREATMENT. Except to the extent otherwise provided herein:
(a) each borrowing of Loans under a particular Facility from the Lenders under
Section 2.01 hereof shall be made from the relevant Lenders, each payment of
Non-Utilization Fee under Section 2.05 hereof in respect of the Revolving Credit
Commitments shall be made for account of the relevant Revolving Credit Lenders,
and each termination or reduction of the amount of the Commitments under a
particular Facility under Section 2.04 hereof shall be applied to the respective
Commitments under such Facility of the relevant Lenders, pro rata according to
the amounts of their respective Commitments under such Facility; (b) except as
otherwise provided in Section 5.04 hereof, Eurodollar Loans under any Facility
having the same Interest Period shall be allocated pro rata among the relevant
Lenders according to the amounts of their respective Commitments under such
Facility (in the case of the making of Loans) or their respective Loans under
such Facility (in the case of Conversions and Continuations of Loans); (c) each
payment or prepayment of principal of Loans under a particular Facility by a
Borrower shall be made for account of the relevant Lenders pro rata in
accordance with the respective unpaid principal amounts
Credit Agreement
----------------
87
- 81 -
of the Loans under such Facility held by them; and (d) each payment of interest
on Loans under a particular Facility by the relevant Borrower shall be made for
account of the relevant Lenders pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective Lenders.
Notwithstanding the foregoing, borrowings, payments and prepayments of Swingline
Loans shall be made without regard to the foregoing provisions of this Section
4.02.
4.03 COMPUTATIONS. Interest on Eurodollar Loans, Non-Utilization Fees and
letter of credit fees shall be computed on the basis of a year of 360 days and
actual days elapsed (including the first day but, except as otherwise provided
in Section 2.03(b)(vii) hereof excluding the last day) occurring in the period
for which payable, and interest on Base Rate Loans and Reimbursement Obligations
shall be computed on the basis of a year of 365 or 366 days, as the case may be,
and actual days elapsed (including the first day but excluding the last day)
occurring in the period for which payable. Notwithstanding the foregoing, for
each day that the Base Rate is calculated by reference to the Federal Funds
Rate, interest on Base Rate Loans and Reimbursement Obligations shall be
computed on the basis of a year of 360 days and actual days elapsed.
4.04 MINIMUM AMOUNTS. Except for Conversions made pursuant to Section 5.04
hereof, each borrowing and Conversion of principal of Loans (other than
Swingline Loans) shall be in an aggregate amount at least equal to $5,000,000 or
a larger multiple of $1,000,000 (borrowings or Conversions of or into Loans of
different Types or, in the case of Eurodollar Loans, having different Interest
Periods at the same time hereunder to be deemed separate borrowings and
Conversions for purposes of the foregoing, one for each Type or Interest
Period), PROVIDED that the aggregate principal amount of Eurodollar Loans having
the same Interest Period shall be in an amount at least equal to $5,000,000 or a
larger multiple of $1,000,000 and, if any Eurodollar Loans would otherwise be in
a lesser principal amount for any period, such Loans shall be borrowed as Base
Rate Loans
Credit Agreement
----------------
88
- 82 -
during such period. Except for mandatory prepayments made pursuant to Section
2.10 hereof and prepayments made pursuant to Section 5.04 hereof, each partial
prepayment of principal of Loans (other than Swingline Loans) shall be in an
aggregate amount at least equal to $500,000 or a larger multiple of $500,000
(prepayments of Loans of different Types or, in the case of Eurodollar Loans,
having different Interest Periods at the same time hereunder to be deemed
separate prepayments for purposes of the foregoing, one for each Type or
Interest Period). Each borrowing of Swingline Loans shall be in an aggregate
amount at least equal to $100,000 or in multiples of $50,000 in excess thereof
and each partial prepayment of Swingline Loans shall be in an aggregate amount
at least equal to $50,000 or in multiples of $50,000 in excess thereof.
4.05 CERTAIN NOTICES. Notices by a Borrower to the Administrative Agent of
terminations or reductions of the Commitments, of borrowings, Conversions,
Continuations and optional prepayments of Loans, of Types of Loans and of the
duration of Interest Periods shall be irrevocable and shall be effective only if
received by the Administrative Agent not later than 12:00 noon New York time on
the number of Business Days prior to the date of the relevant termination,
reduction, borrowing, Conversion, Continuation or prepayment or the first day of
such Interest Period specified below:
Credit Agreement
----------------
89
- 83 -
Number of
Business
Notice Days Prior
------ ----------
Termination or reduction
of Commitments 3
Borrowing or prepayment
of Swingline Loans same day
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans
(other than Swingline Loans) 1
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans 3
Each such notice of termination or reduction shall specify the amount and the
Facility under which the Commitments are to be terminated or reduced. Each such
notice of borrowing, Conversion, Continuation or optional prepayment shall
specify the Facility of Loans to be borrowed, Converted, Continued or prepaid
and the amount (subject to Section 4.04 hereof) and Type of each Loan to be
borrowed, Converted, Continued or prepaid and the date of borrowing, Conversion,
Continuation or optional prepayment (which shall be a Business Day). Each such
notice of the duration of an Interest Period shall specify the Loans to which
such Interest Period is to relate. The Administrative Agent shall promptly
notify the Lenders of the contents of each such notice. In the event that a
Borrower fails to select the Type of Loan, or the duration of any Interest
Period for any Eurodollar Loan, within the time period and otherwise as provided
in this Section 4.05, such Loan (if outstanding as a Eurodollar Loan) will be
automatically Converted into a Base Rate Loan on the last day of the then
current Interest Period for such Loan or (if
Credit Agreement
----------------
90
- 84 -
outstanding as a Base Rate Loan) will remain as, or (if not then outstanding)
will be made as, a Base Rate Loan.
4.06 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT. Unless the
Administrative Agent shall have been notified by a Lender or a Borrower (the
"PAYOR") prior to the date on which the Payor is to make payment to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan
required to be made by such Lender hereunder or (in the case of a Borrower) a
payment to the Administrative Agent for account of one or more of the Lenders
hereunder (such payment being herein called the "REQUIRED PAYMENT"), which
notice shall be effective upon receipt, that the Payor does not intend to make
the Required Payment to the Administrative Agent, the Administrative Agent may
assume that the Required Payment has been made and may, in reliance upon such
assumption (but shall not be required to), make the amount thereof available to
the intended recipient(s) on such date; and, if the Payor has not in fact made
the Required Payment to the Administrative Agent, the recipient(s) of such
payment shall, on demand, repay to the Administrative Agent the amount so made
available together with interest thereon in respect of each day during the
period commencing on the date (the "ADVANCE DATE") such amount was so made
available by the Administrative Agent until the date the Administrative Agent
recovers such amount at a rate per annum equal to the Federal Funds Rate for
such day and, if such recipient(s) shall fail promptly to make such payment, the
Administrative Agent shall be entitled to recover such amount, on demand, from
the Payor, together with interest as aforesaid, PROVIDED that if neither the
recipient(s) nor the Payor shall return the Required Payment to the
Administrative Agent within three Business Days of the Advance Date, then,
retroactively to the Advance Date, the Payor and the recipient(s) shall each be
obligated to pay interest on the Required Payment as follows:
(i) if the Required Payment shall represent a payment to be made by a
Borrower to the Lenders, such Borrower and the recipient(s) shall each be
obligated retroactively to
Credit Agreement
----------------
91
- 85 -
the Advance Date to pay interest in respect of the Required Payment at the
Post-Default Rate (without duplication of the obligation of the Borrowers
under Section 3.02 hereof to pay interest on the Required Payment at the
Post-Default Rate), it being understood that the return by the recipient(s)
of the Required Payment to the Administrative Agent shall not limit such
obligation of such Borrower under said Section 3.02 to pay interest at the
Post-Default Rate in respect of the Required Payment and
(ii) if the Required Payment shall represent proceeds of a Loan to be
made by the Lenders to a Borrower, the Payor and such Borrower shall each
be obligated retroactively to the Advance Date to pay interest in respect
of the Required Payment pursuant to whichever of the rates specified in
Section 3.02 hereof is applicable to the Type of such Loan, it being
understood that the return by a Borrower of the Required Payment to the
Administrative Agent shall not limit any claim such Borrower may have
against the Payor in respect of such Required Payment.
4.07 SHARING OF PAYMENTS, ETC.
(a) Each Obligor agrees that, in addition to (and without limitation of)
any right of set-off, banker's lien or counterclaim a Lender may otherwise have,
each Lender shall be entitled, at its option (to the fullest extent permitted by
law), to set off and apply any deposit (general or special, time or demand,
provisional or final), or other indebtedness, held by it for the credit or
account of such Obligor at any of its offices, in Dollars or in any other
currency, against any principal of or interest on any of such Lender's Loans,
Reimbursement Obligations or any other amount payable to such Lender hereunder,
that is not paid when due (regardless of whether such deposit or other
indebtedness are then due to such Obligor), in which case it shall promptly
notify such Obligor and the Administrative Agent thereof, PROVIDED that such
Lender's failure to give such notice shall not affect the validity thereof.
Credit Agreement
----------------
92
- 86 -
(b) If any Lender shall obtain from any Obligor payment of any principal of
or interest on any Loan under any Facility or Letter of Credit Liability owing
to it or payment of any other amount under this Agreement or any other Credit
Document through the exercise of any right of set-off, banker's lien or
counterclaim or similar right or otherwise (other than from the Administrative
Agent as provided herein), and, as a result of such payment, such Lender shall
have received a greater percentage of the principal of or interest on the Loans
under such Facility or Letter of Credit Liabilities or such other amounts then
due hereunder or thereunder by such Obligor to such Lender than the percentage
received by any other Lender, it shall promptly purchase from such other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans under such Facility or Letter of Credit Liabilities or
such other amounts, respectively, owing to such other Lenders (or in interest
due thereon, as the case may be) in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such excess payment (net of any expenses that
may be incurred by such Lender in obtaining or preserving such excess payment)
pro rata in accordance with the unpaid principal of and/or interest on the Loans
under such Facility or Letter of Credit Liabilities or such other amounts,
respectively, owing to each of the Lenders. To such end all the Lenders shall
make appropriate adjustments among themselves (by the resale of participations
sold or otherwise) if such payment is rescinded or must otherwise be restored.
(c) Each Obligor agrees that any Lender so purchasing such a participation
(or direct interest) may exercise all rights of set-off, banker's lien,
counterclaim or similar rights with respect to such participation as fully as if
such Lender were a direct holder of Loans or other amounts (as the case may be)
owing to such Lender in the amount of such participation.
Credit Agreement
----------------
93
- 87 -
(d) Nothing contained herein shall require any Lender to exercise any such
right or shall affect the right of any Lender to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of any Obligor. If, under any applicable bankruptcy, insolvency or
other similar law, any Lender receives a secured claim in lieu of a set-off to
which this Section 4.07 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders entitled under this Section 4.07 to share in the
benefits of any recovery on such secured claim.
Section 5. YIELD PROTECTION, ETC.
5.01 ADDITIONAL COSTS.
(a) Each Borrower shall pay directly to each Lender from time to time such
amounts as such Lender may determine to be necessary to compensate such Lender
for any costs that such Lender determines are attributable to its making or
maintaining of any Eurodollar Loans or its obligation to make any Eurodollar
Loans hereunder, or any reduction in any amount receivable by such Lender
hereunder in respect of any of such Loans or such obligation, resulting from any
Regulatory Change that:
(i) shall subject any Lender (or its Applicable Lending Office for any
of such Loans) to any tax, duty or other charge in respect of such Loans or
its Notes or changes the basis of taxation of any amounts payable to such
Lender under this Agreement or its Notes in respect of any of such Loans
(excluding changes in the rate of tax on the overall net income of such
Lender or of such Applicable Lending Office by the jurisdiction in which
such Lender has its principal office or such Applicable Lending Office); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than the Reserve Requirement
Credit Agreement
----------------
94
- 88 -
utilized in the determination of the Eurodollar Rate for such Loan)
relating to any extensions of credit or other assets of, or any deposits
with or other liabilities of, such Lender (including, without limitation,
any of such Loans or any deposits referred to in the definition of
"Eurodollar Base Rate" in Section 1.01 hereof), or any commitment of such
Lender (including, without limitation, the Commitments of such Lender
hereunder); or
(iii) imposes any other condition affecting this Agreement or its
Notes (or any of such extensions of credit or liabilities) or its
Commitments.
If any Lender requests compensation from a Borrower under this Section 5.01(a),
such Borrower may, by notice to such Lender through the Parent (with a copy to
the Administrative Agent), suspend the obligation of such Lender thereafter to
make or Continue Eurodollar Loans, or to Convert Base Rate Loans into Eurodollar
Loans, until the Regulatory Change giving rise to such request ceases to be in
effect (in which case the provisions of Section 5.04 hereof shall be
applicable), PROVIDED that such suspension shall not affect the right of such
Lender to receive the compensation so requested.
(b) Without limiting the effect of the foregoing provisions of this Section
5.01 (but without duplication), each Borrower shall pay directly to each Lender
from time to time on request such amounts as such Lender may determine to be
necessary to compensate such Lender (or, without duplication, the bank holding
company of which such Lender is a subsidiary) for any costs that it determines
are attributable to the maintenance by such Lender (or any Applicable Lending
Office or such bank holding company), pursuant to any law or regulation or any
interpretation, directive or request (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) of any court or
governmental or monetary authority (i) following any Regulatory Change or (ii)
implementing any risk-based capital guideline or other requirement (whether or
not
Credit Agreement
----------------
95
- 89 -
having the force of law and whether or not the failure to comply therewith would
be unlawful) hereafter issued by any government or governmental or supervisory
authority implementing at the national level the Basle Accord, of capital in
respect of its Commitments or Loans (such compensation to include, without
limitation, an amount equal to any reduction of the rate of return on assets or
equity of such Lender (or any Applicable Lending Office or such bank holding
company) to a level below that which such Lender (or any Applicable Lending
Office or such bank holding company) could have achieved but for such law,
regulation, interpretation, directive or request).
(c) Each Lender shall notify the Borrowers of any event occurring after the
date hereof entitling such Lender to compensation under paragraph (a) or (b) of
this Section 5.01 as promptly as practicable, but in any event within 180 days,
after such Lender obtains actual knowledge thereof; PROVIDED that (i) if any
Lender fails to give such notice within 180 days after it obtains actual
knowledge of such an event, such Lender shall, with respect to compensation
payable pursuant to this Section 5.01 in respect of any costs resulting from
such event, only be entitled to payment under this Section 5.01 for costs
incurred from and after the date 180 days prior to the date that such Lender
does give such notice and (ii) each Lender will designate a different Applicable
Lending Office for the Loans of such Lender affected by such event if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the sole opinion of such Lender, be disadvantageous to such
Lender, except that such Lender shall have no obligation to designate an
Applicable Lending Office located in the United States of America. Each Lender
will furnish to the relevant Borrower a certificate setting forth in reasonable
detail the basis and amount of each request by such Lender for compensation
under paragraph (a) or (b) of this Section 5.01. Determinations and allocations
by any Lender for purposes of this Section 5.01 of the effect of any Regulatory
Change pursuant to paragraph (a) of this Section 5.01, or of the effect of
capital maintained pursuant to paragraph (b) of this Section 5.01, on its costs
or
Credit Agreement
----------------
96
- 90 -
rate of return of maintaining Loans or its obligation to make Loans, or on
amounts receivable by it in respect of Loans, and of the amounts required to
compensate such Lender under this Section 5.01, shall be conclusive, PROVIDED
that such determinations and allocations are made on a reasonable basis and
consistent with the methodology generally applied by such Lender.
5.02 LIMITATION ON TYPES OF LOANS. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of any Eurodollar Base
Rate for any Interest Period:
(a) the Administrative Agent determines, which determination shall be
conclusive, that quotations of interest rates for the relevant deposits
referred to in the definition of "Eurodollar Base Rate" in Section 1.01
hereof are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for Eurodollar
Loans as provided herein; or
(b) if the related Loans are Revolving Credit Loans, the Majority
Revolving Credit Lenders, or if the related Loans are Term Loans, the
Majority Term Loan Lenders, determine, which determination shall be
conclusive, and notify the Administrative Agent that the relevant rates of
interest referred to in the definition of "Eurodollar Base Rate" in Section
1.01 hereof upon the basis of which the rate of interest for Eurodollar
Loans for such Interest Period is to be determined are not likely
adequately to cover the cost to such Lenders of making or maintaining
Eurodollar Loans for such Interest Period;
then the Administrative Agent shall give each Borrower and each Lender prompt
notice thereof and, so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurodollar Loans, to Continue
Eurodollar Loans or to Convert Base Rate Loans into Eurodollar Loans, and each
Borrower shall, on the last day(s) of the then current Interest
Credit Agreement
----------------
97
- 91 -
Period(s) for the outstanding Eurodollar Loans, either prepay such Loans or
Convert such Loans into Base Rate Loans in accordance with Section 2.09 hereof.
5.03 ILLEGALITY. Notwithstanding any other provision of this Agreement, in
the event that it becomes unlawful for any Lender or its Applicable Lending
Office to honor its obligation to make or maintain Eurodollar Loans hereunder
(and, in the sole opinion of such Lender, the designation of a different
Applicable Lending Office would either not avoid such unlawfulness or would be
disadvantageous to such Lender), then such Lender shall promptly notify each
Borrower thereof (with a copy to the Administrative Agent) and such Lender's
obligation to make or Continue, or to Convert Loans of any other Type into,
Eurodollar Loans shall be suspended until such time as such Lender may again
make and maintain Eurodollar Loans (in which case the provisions of Section 5.04
hereof shall be applicable).
5.04 TREATMENT OF AFFECTED LOANS. If the obligation of any Lender to make
Eurodollar Loans or to Continue, or to Convert Base Rate Loans into, Eurodollar
Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof, such Lender's
Eurodollar Loans shall be automatically Converted into Base Rate Loans on the
last day(s) of the then current Interest Period(s) for Eurodollar Loans (or, in
the case of a Conversion resulting from a circumstance described in Section 5.03
hereof, on such earlier date as such Lender may specify to the Borrowers with a
copy to the Administrative Agent) and, unless and until such Lender gives notice
as provided below that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Lender's Eurodollar Loans shall be applied instead to
its Base Rate Loans; and
Credit Agreement
----------------
98
- 92 -
(b) all Loans that would otherwise be made or Continued by such Lender
as Eurodollar Loans shall be made or Continued instead as Base Rate Loans,
and all Base Rate Loans of such Lender that would otherwise be Converted
into Eurodollar Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrowers with a copy to the Administrative
Agent that the circumstances specified in Section 5.01 or 5.03 hereof that gave
rise to the Conversion of such Lender's Eurodollar Loans pursuant to this
Section 5.04 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans under the same
Facility made by other Lenders are outstanding, such Lender's Base Rate Loans
under such Facility shall be automatically Converted, on the first day(s) of the
next succeeding Interest Period(s) for such outstanding Eurodollar Loans, to the
extent necessary so that, after giving effect thereto, all Base Rate and
Eurodollar Loans under such Facility are allocated among the Lenders ratably (as
to principal amounts, Types and Interest Periods) in accordance with their
respective Commitments under such Facility.
5.05 COMPENSATION. Each Borrower shall pay to the Administrative Agent for
account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense (excluding lost profit) that such Lender determines is attributable to:
(a) any payment, mandatory or optional prepayment or Conversion of a
Eurodollar Loan made by such Lender for any reason (including, without
limitation, the acceleration of the Loans pursuant to Section 10 hereof) on
a date other than the last day of the Interest Period for such Loan; or
(b) any failure by such Borrower for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 7 hereof to be
Credit Agreement
----------------
99
- 93 -
satisfied) to borrow a Eurodollar Loan from such Lender on the date for
such borrowing specified in the relevant notice of borrowing given pursuant
to Section 2.02 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid,
Converted or not borrowed for the period from the date of such payment,
prepayment, Conversion or failure to borrow to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for such Loan that would have commenced on the date specified
for such borrowing) at the applicable rate of interest (but excluding the
Applicable Margin) for such Loan provided for herein OVER (ii) the amount of
interest that otherwise would have accrued on such principal amount at a rate
per annum equal to the interest component of the amount such Lender would have
bid in the London interbank market for Dollar deposits of leading banks in
amounts comparable to such principal amount and with maturities comparable to
such period (as reasonably determined by such Lender).
Without limiting the foregoing and notwithstanding anything to the contrary
contained herein or in the Original Credit Agreement, on the Restatement
Effective Date the Borrowers shall pay to the Administrative Agent for account
of the Existing Lenders such amounts (if any) that would be payable under
Section 5.05 of the Original Credit Agreement assuming any "Eurodollar Loans"
outstanding thereunder had been paid in full on the Restatement Effective Date.
5.06 ADDITIONAL COSTS IN RESPECT OF LETTERS OF CREDIT. Without limiting the
obligations of the Borrowers under Section 5.01 hereof (but without
duplication), if as a result of any Regulatory Change or any risk-based capital
guideline or other requirement heretofore or hereafter issued by any government
or governmental or supervisory authority implementing at the national level the
Basle Accord there shall be imposed,
Credit Agreement
----------------
100
- 94 -
modified or deemed applicable any tax, reserve, special deposit, capital
adequacy or similar requirement against or with respect to or measured by
reference to Letters of Credit issued or to be issued hereunder and the result
shall be to increase the cost to any Lender or Lenders of issuing (or purchasing
participations in) or maintaining its obligation hereunder to issue (or purchase
participations in) any Letter of Credit hereunder or reduce any amount
receivable by any Lender hereunder in respect of any Letter of Credit (which
increases in cost, or reductions in amount receivable, shall be the result of
such Lender's or Lenders' reasonable allocation of the aggregate of such
increases or reductions resulting from such event), then, upon demand by such
Lender or Lenders (through the Administrative Agent), the Borrowers shall pay
immediately to the Administrative Agent for account of such Lender or Lenders,
from time to time as specified by such Lender or Lenders (through the
Administrative Agent), such additional amounts as shall be sufficient to
compensate such Lender or Lenders (through the Administrative Agent) for such
increased costs or reductions in amount. A statement as to such increased costs
or reductions in amount incurred by any such Lender or Lenders, submitted by
such Lender or Lenders to the Borrowers shall be conclusive in the absence of
manifest error as to the amount thereof.
5.07 U.S. TAXES.
(a) Each Borrower agrees to pay to each Lender that is not a U.S. Person
such additional amounts as are necessary in order that the net payment of any
amount due to such non-U.S. Person hereunder after deduction for or withholding
in respect of any U.S. Taxes imposed with respect to such payment (or in lieu
thereof, payment of such U.S. Taxes by such non-U.S. Person), will not be less
than the amount stated herein to be then due and payable, PROVIDED that the
foregoing obligation to pay such additional amounts shall not apply:
(i) to any payment to any Lender hereunder unless such Lender is, on
the date hereof (or on the date it becomes a
Credit Agreement
----------------
101
- 95 -
Lender hereunder as provided in Section 12.06(b) hereof) and on the date of
any change in the Applicable Lending Office of such Lender, either entitled
to submit a Form 1001 (relating to such Lender and entitling it to a
complete exemption from withholding on all interest to be received by it
hereunder in respect of the Loans) or Form 4224 (relating to all interest
to be received by such Lender hereunder in respect of the Loans),
(ii) to any U.S. Taxes to the extent imposed by reason of the failure
by such non-U.S. Person to comply with applicable certification,
information, documentation or other reporting requirements concerning the
nationality, residence, identity or connections with the United States of
America of such non-U.S. Person (including the filing of Form 1001 or 4224,
as appropriate) if such compliance is required by statute or regulation of
the United States of America as a precondition to reduction of or relief or
exemption from such U.S. Taxes, or
(iii) to any tax assessment or other governmental charge which is
payable otherwise than by withholding or deduction from payments due such
non-U.S. Person hereunder.
For the purposes of this Section 5.07(a), (A) "U.S. PERSON" shall mean a
citizen, national or resident of the United States of America, a corporation,
partnership or other entity created or organized in or under any laws of the
United States of America or any State thereof, or any estate or trust that is
subject to U.S. Federal income taxation regardless of the source of its income,
(B) "U.S. TAXES" shall mean any present or future tax, assessment or other
charge or levy imposed by or on behalf of the United States of America or any
taxing authority thereof or therein, (C) "FORM 1001" shall mean Form 1001
(Ownership, Exemption, or Reduced Rate Certificate) of the Department of the
Treasury of the United States of America and (D) "FORM 4224" shall mean Form
4224 (Exemption from Withholding of Tax on Income Effectively Connected with the
Conduct of a Trade or Business in
Credit Agreement
----------------
000
- 00 -
xxx Xxxxxx Xxxxxx) of the Department of the Treasury of the United States of
America (or in relation to either such Form such successor and related forms as
may from time to time be adopted by the relevant taxing authorities of the
United States of America to document a claim to which such Form relates). Each
of the Forms referred to in the foregoing clauses (C) and (D) shall include such
successor and related forms as may from time to time be adopted by the relevant
taxing authorities of the United States of America to document a claim to which
such Form relates.
(b) Within 30 days after paying any amount to the Administrative Agent or
any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the
Borrowers shall deliver to the Administrative Agent for delivery to such
non-U.S. Person evidence satisfactory to such Person of such deduction,
withholding or payment (as the case may be).
5.08 REPLACEMENT OF LENDERS. If any Lender defaults in its obligations to
make Loans pursuant to Section 2.01 hereof or to fund unreimbursed drawings
under Section 2.03 hereof or requests compensation pursuant to Section 5.01 or
5.06 hereof (any such Lender so defaulting or so requesting such compensation
being herein called a "REQUESTING LENDER"), the Parent, upon three Business Days
notice, may require that such Requesting Lender transfer and assign all of its
right, title and interest under this Agreement and such Requesting Lender's
Notes, if any, to any bank or other financial institution (a "PROPOSED LENDER")
identified by the Parent that is satisfactory to the Administrative Agent and
the Issuing Banks (and, upon request of the Parent, the Administrative Agent
agrees to use reasonable efforts to assist the Parent in identifying Proposed
Lenders for this purpose) (a) if such Proposed Lender agrees to assume all of
the obligations of such Requesting Lender hereunder, and to purchase all of such
Requesting Lender's Loans hereunder for consideration equal to the aggregate
outstanding principal amount of such Requesting Lender's Loans, together with
interest thereon
Credit Agreement
----------------
103
- 97 -
to the date of such purchase, and satisfactory arrangements are made for payment
to such Requesting Lender of all other amounts payable hereunder to such
Requesting Lender on or prior to the date of such transfer (including any fees
accrued hereunder and all amounts payable under Section 5 hereof, including all
amounts payable under Section 5.05 hereof as if all of such Requesting Lender's
Loans were being prepaid in full on such date) and (b) if such Requesting Lender
has requested compensation pursuant to Section 5.01 or 5.06 hereof, such
Proposed Lender's aggregate requested compensation, if any, pursuant to said
Section 5.01 or 5.06 with respect to such Requesting Lender's Loans is lower
than that of the Requesting Lender. Subject to the provisions of Section
12.06(b) hereof, such Proposed Lender shall be a "Lender" for all purposes
hereunder. Without prejudice to the survival of any other agreement of the
Obligors hereunder the agreements of the Borrowers contained in Sections 5 and
12.03 hereof (without duplication of any payments made to such Requesting Lender
by the Parent or the Proposed Lender) shall survive for the benefit of such
Requesting Lender under this Section 5.08 with respect to the time prior to such
replacement.
Credit Agreement
----------------
104
- 98 -
Section 6. GUARANTEE.
6.01 THE GUARANTEE.
(a) The Guarantors hereby jointly and severally guarantee to each Lender
and the Administrative Agent and their respective successors and assigns the
prompt payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest on the Loans made by the Lenders to,
and the Notes held by each Lender of, the Borrowers and all other amounts from
time to time owing to the Lenders or the Administrative Agent by the Borrowers
under this Agreement and under the Notes and by any Obligor under any of the
other Credit Documents, and all obligations of the Parent or any of its
Subsidiaries to any Lender in respect of any Interest Rate Protection Agreement,
in each case strictly in accordance with the terms thereof (such obligations
being herein collectively called the "GENERAL GUARANTEED OBLIGATIONS"). The
Guarantors hereby further jointly and severally agree that if any Borrower shall
fail to pay in full when due (whether at stated maturity, by acceleration or
otherwise) any of the General Guaranteed Obligations, the Guarantors will
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the General
Guaranteed Obligations, the same will be promptly paid in full when due (whether
at extended maturity, by acceleration or otherwise) in accordance with the terms
of such extension or renewal.
Credit Agreement
----------------
105
- 99 -
(b) Without limiting the generality of Section 6.01(a) hereof, each
Revolving Credit Borrower hereby guarantees to each Revolving Credit Lender and
the Administrative Agent and their respective successors and assigns the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of the principal of and interest on the Loans made by such Lenders
to, and the Notes held by each Lender of, the other Revolving Credit Borrowers
and all other amounts from time to time owing to the Lenders or the
Administrative Agent by such Borrowers under the Revolving Credit Facility under
this Agreement and under the Notes and by any Obligor under any of the other
Credit Documents, and all obligations of such Borrowers or any of their
respective Subsidiaries to any Lender in respect of any Interest Rate Protection
Agreement, in each case strictly in accordance with the terms thereof (such
obligations being herein collectively called the "JOINT OBLIGATIONS" and,
collectively with the General Guaranteed Obligations, the "GUARANTEED
OBLIGATIONS"). The Revolving Credit Borrowers hereby further jointly and
severally agree that if any other Revolving Credit Borrower shall fail to pay in
full when due (whether at stated maturity, by acceleration or otherwise) any of
the Joint Obligations, the other Revolving Credit Borrowers will promptly pay
the same, without any demand or notice whatsoever, and that in the case of any
extension of time of payment or renewal of any of the Joint Obligations, the
same will be promptly paid in full when due (whether at extended maturity, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.
Credit Agreement
----------------
106
- 100 -
6.02 OBLIGATIONS UNCONDITIONAL.
(a) The obligations of the Guarantors under Section 6.01(a) hereof are
absolute and unconditional, joint and several, irrespective of the value,
genuineness, validity, regularity or enforceability of the obligations of the
Borrowers under this Agreement, the Notes or any other agreement or instrument
referred to herein or therein, or any substitution, release or exchange of any
other guarantee of or security for any of the Guaranteed Obligations, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 6.02(a) that the obligations of the Guarantors hereunder shall be
absolute and unconditional, joint and several, under any and all circumstances.
(b) The obligations of the Revolving Credit Borrowers under Section 6.01(b)
hereof are absolute and unconditional, joint and several, irrespective of the
value, genuineness, validity, regularity or enforceability of the obligations of
the other Revolving Credit Borrowers under this Agreement, the Notes or any
other agreement or instrument referred to herein or therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Joint Obligations, and, to the fullest extent permitted by applicable
law, irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 6.02(b) that the obligations of each
Revolving Credit Borrower shall be absolute and unconditional, joint and
several, under any and all circumstances.
(c) Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the
liability of the
Credit Agreement
----------------
107
- 101 -
Guarantors hereunder which shall remain absolute and unconditional as described
above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or compliance
shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement
or the Notes or any other agreement or instrument referred to herein or
therein shall be waived or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be released or exchanged in
whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of the
Guaranteed Obligations shall fail to be perfected.
The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that the Administrative
Agent or any Lender exhaust any right, power or remedy or proceed against any
Borrower under this Agreement or the Notes or any other agreement or instrument
referred to herein or therein, or against any other Person under any other
guarantee of, or security for, any of the Guaranteed Obligations.
Credit Agreement
----------------
108
- 102 -
6.03 REINSTATEMENT. The obligations of the Guarantors under this Section 6
shall be automatically reinstated if and to the extent that for any reason any
payment by or on behalf of the relevant Borrower in respect of the relevant
Guaranteed Obligations is rescinded or must be otherwise restored by any holder
of any of such Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise and the Guarantors jointly and
severally agree that they will indemnify the Administrative Agent and each
Lender on demand for all reasonable costs and expenses (including, without
limitation, fees of counsel) incurred by the Administrative Agent or such Lender
in connection with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
6.04 SUBROGATION. The Guarantors hereby jointly and severally agree that
until the payment and satisfaction in full of all Guaranteed Obligations and the
expiration and termination of the Commitments of the Lenders under this
Agreement they shall not exercise any right or remedy arising by reason of any
performance by them of their guarantee in Section 6.01 hereof, whether by
subrogation or otherwise, against the Borrowers or any other guarantor of any of
the Guaranteed Obligations or any security for any of the Guaranteed
Obligations.
6.05 REMEDIES. The Guarantors jointly and severally agree that, as between
the Guarantors and the Lenders, the obligations of the relevant Borrower under
this Agreement and the Notes may be declared to be forthwith due and payable as
provided in Section 10 hereof (and shall be deemed to have become automatically
due and payable in the circumstances provided in said Section 10) for purposes
of Section 6.01 hereof notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against such Borrower and that, in the event of such declaration
(or such obligations being
Credit Agreement
----------------
109
- 103 -
deemed to have become automatically due and payable),
such obligations (whether or not due and payable by such Borrower) shall
forthwith become due and payable by the Guarantors for purposes of said Section
6.01.
6.06 CONTINUING GUARANTEE. The guarantee in this Section 6 is a continuing
guarantee, and shall apply to all Guaranteed Obligations whenever arising.
6.07 RIGHTS OF CONTRIBUTION.
(a) Each Relevant Obligor hereby agrees, as between themselves, that if any
Relevant Obligor shall become an Excess Funding Guarantor (as defined below) by
reason of the payment by such Relevant Obligor of any Guaranteed Obligations,
each other Relevant Obligor shall, on demand of such Excess Funding Guarantor
(but subject to the next sentence), pay to such Excess Funding Guarantor an
amount equal to such Relevant Obligor's Pro Rata Share (as defined below and
determined, for this purpose, without reference to the Properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
in paragraph (b) below) in respect of such Guaranteed Obligations. The payment
obligation of a Relevant Obligor to any Excess Funding Guarantor under this
Section 6.07 shall be subordinate and subject in right of payment to the prior
payment in full of the obligations of such Relevant Obligor under the other
provisions of this Section 6 and such Excess Funding Guarantor shall not
exercise any right or remedy with respect to such excess until payment and
satisfaction in full of all of such obligations.
(b) For purposes of this Section 6.07: (i) "RELEVANT OBLIGOR" shall mean
each Borrower and each of the Subsidiary Guarantors; (ii) "EXCESS FUNDING
GUARANTOR" shall mean, in respect of any Guaranteed Obligations, a Relevant
Obligor that has paid an amount in excess of its Pro Rata Share of such
Guaranteed Obligations; (iii) "EXCESS PAYMENT" shall mean, in respect of any
Guaranteed Obligations, the amount paid by an
Credit Agreement
----------------
110
- 104 -
Excess Funding Guarantor in excess of its Pro Rata Share of such Guaranteed
Obligations; (iv) "PRO RATA SHARE" shall mean, for any Relevant Obligor, the
ratio (expressed as a percentage) of the amount of such Relevant Obligor's Net
Assets to the amount of the aggregate Net Assets of all of the Relevant
Obligors, in each case determined as of (A)(x) with respect to any Relevant
Obligor that was a party to the Original Credit Agreement on the Original
Closing Date, the Original Closing Date or (y) with respect to any other
Relevant Obligor, the date such Relevant Obligor becomes a Relevant Obligor
hereunder or (B) the date any demand is made hereunder in respect of the
Guaranteed Obligations, whichever date results in the higher amount (the
"DETERMINATION DATE"); and (v) "NET ASSETS" of any Relevant Obligor shall mean
the amount by which the aggregate present fair saleable value of all assets of
such Relevant Obligor (excluding any shares of stock of any other Relevant
Obligor) exceeds the amount of all the debts and liabilities of such Relevant
Obligor (including contingent, subordinated, unmatured and unliquidated
liabilities, but excluding (x) the obligations of such Relevant Obligor under
this Section 6, assuming the full utilization of permitted borrowings under this
Agreement and after giving effect, on a PRO FORMA basis (but without
duplication), to all such obligations of such Relevant Obligor to be incurred or
assumed as of the Original Closing Date and (y) the obligations of such Relevant
Obligor in respect of its guarantee of the Senior Subordinated Debt, assuming
all such obligations are in existence as of the date hereof and after giving
effect to all such obligations which shall become effective as of the Original
Closing Date).
6.08 LIMITATION ON GUARANTEE OBLIGATIONS. Notwithstanding any other
provision of this Agreement to the contrary, in any action or proceeding
involving any state corporate law or any state or Federal bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of any Relevant Obligor hereunder would otherwise
be held or determined to be void, invalid or unenforceable on account of the
amount of its liability under this Section 6, then notwithstanding any other
provision of this
Credit Agreement
----------------
111
- 105 -
Agreement to the contrary, the amount of such liability shall, without any
further action by such Relevant Obligor or any other Person, be automatically
limited and reduced to the highest amount that is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.
Section 7. CONDITIONS PRECEDENT.
7.01 INITIAL LOANS. Attached as Schedule XV hereto is a list of documents
delivered in connection with the making of the initial loans on the Original
Closing Date.
7.02 CONDITIONS TO EFFECTIVENESS. The effectiveness of this Agreement (and
the amendment and restatement of the Original Credit Agreement to be effected
hereby), and the obligation of any Lender to extend credit hereunder on the
Restatement Effective Date, are subject to the receipt by the Administrative
Agent of the following documents, each of which shall be satisfactory to the
Administrative Agent (and to the extent specified below, to each Lender or the
Majority Lenders) in form and substance:
(a) CORPORATE DOCUMENTS. The following documents, each certified as
indicated below:
(i) for each Obligor (other than Holdings), a certification to the
effect that none of the charter documents, by-laws, resolutions or other
documents relating to such Obligor delivered pursuant to Section 7.01(a) of
the Original Credit Agreement has been modified since delivery thereof to
the Administrative Agent on the Original Closing Date (or, to the extent
that any thereof have been modified, a copy of such modification certified
(in the case of a modification of a charter document) by the appropriate
Secretary of State or (in the case of a modification of
Credit Agreement
----------------
112
- 106 -
any such other document) by the Secretary or an Assistant Secretary of such
Obligor;
(ii) for Holdings:
(X) a copy of the charter, as amended and in effect, of Holdings
certified as of a date reasonably close to the Restatement Effective
Date by the appropriate Secretary of State and a certificate from such
Secretary of State dated as of a date reasonably close to the
Restatement Effective Date as to the good standing of and charter
documents filed by Holdings;
(Y) a certificate of the Secretary or an Assistant Secretary of
Holdings, dated the Restatement Effective Date and certifying (A) that
attached thereto is a true and complete copy of the by-laws of
Holdings as amended and in effect at all times from the date on which
the resolutions referred to in clause (B) were adopted to and
including the date of such certificate, (B) that attached thereto is a
true and complete copy of resolutions duly adopted by the board of
directors of Holdings authorizing the execution, delivery and
performance of such of the Loan Documents to which Holdings is or is
intended to be a party and the incurrence of liability hereunder, and
that such resolutions have not been modified, rescinded or amended and
are in full force and effect, (C) that the charter of Holdings has not
been amended since the date of the certification thereto furnished
pursuant to clause (i) above, and (D) as to the incumbency and
specimen signature of each officer of Holdings executing such of the
Loan Documents to which Holdings is intended to be a party and each
other document to be delivered by Holdings from time to time in
connection therewith (and the
Credit Agreement
----------------
113
- 107 -
Administrative Agent and each Lender may conclusively rely on such
certificate until it receives notice in writing from Holdings; and
(Z) a certificate of another officer of such Obligor, dated the
Restatement Effective Date, as to the incumbency and specimen
signature of the Secretary or Assistant Secretary, as the case may be,
of such Obligor; and
(iii) for each Obligor, such other proof of corporate or other
authority, charter documents, good standing certificates and evidence of
incumbency as the Administrative Agent may reasonably request.
(b) OFFICER'S CERTIFICATE. A certificate of a senior officer of the Parent,
dated the Restatement Effective Date, to the effect set forth in the first
sentence of Section 7.03 hereof.
(c) NOTES. The Notes, duly completed and executed for each Lender.
(d) OPINIONS OF SPECIAL NEW YORK COUNSEL TO THE OBLIGORS. Opinions, dated
the Restatement Effective Date, of Xxxxxxxx & Xxxxxxxx, special New York counsel
to certain of the Obligors, and such other counsel satisfactory to the
Administrative Agent, each in substantially the form delivered pursuant to
Section 7.01(d) of the Original Credit Agreement, with such changes thereto as
the Administrative Agent may reasonably request (and each Obligor hereby
instructs such counsel to deliver such opinions to the Lenders and the
Administrative Agent).
(e) OPINION OF SPECIAL NEW YORK COUNSEL TO NATWEST. An opinion, dated the
Restatement Effective Date, of Milbank, Tweed, Xxxxxx & XxXxxx, special New York
counsel to NatWest, in substantially the form delivered pursuant to Section
7.01(f) of the Original Credit Agreement, with such
Credit Agreement
----------------
114
- 108 -
changes thereto as the Administrative Agent may reasonably request (and
NatWest hereby instructs such counsel to deliver such opinion to the
Lenders and the Administrative Agent).
(f) AMENDED AND RESTATED PLEDGE AND SECURITY AGREEMENT. An Amended and
Restated Pledge and Security Agreement, in substantially the form attached
as Exhibit C hereto, duly executed and delivered by the Obligors and the
Administrative Agent. In addition, the Obligors shall have taken such other
action as the Administrative Agent shall have requested in order to perfect
the security interests created pursuant to the Security Documents to the
extent such actions have not already been taken pursuant to the Original
Credit Agreement.
(g) OTHER DOCUMENTS. Such other documents as the Administrative Agent
or any Lender or special New York counsel to the Administrative Agent may
reasonably request.
The effectiveness of this Agreement (the amendment and restatement of the
Original Credit Agreement contemplated hereby) and the obligation of any Lender
to make its initial extension of credit hereunder is also subject to the payment
or delivery by the Parent of such fees and other consideration as the Parent
shall have agreed to pay or deliver to any Lender or an affiliate thereof or the
Administrative Agent in connection herewith, including, without limitation, the
reasonable fees and expenses of Milbank, Tweed, Xxxxxx & XxXxxx, special New
York counsel to NatWest, in connection with the negotiation, preparation,
execution and delivery of this Agreement and the Notes and the other Credit
Documents and the making of the extensions of credit hereunder (to the extent
that statements for such fees and expenses have been delivered to the Parent).
7.03 INITIAL AND SUBSEQUENT EXTENSIONS OF CREDIT. The
obligation of the Lenders to make any Loan or otherwise extend
any credit to either Obligor upon the occasion of each borrowing
or other extension of credit hereunder (and the amendment and
Credit Agreement
----------------
115
- 109 -
restatement of the Original Credit Agreement to be effected hereby) is subject
to the further conditions precedent that, both immediately prior to the making
of such Loan or other extension of credit (and such amendment and restatement)
and also after giving effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be continuing;
(b) the representations and warranties made by each Obligor in Section
8 hereof and in each other Basic Document to which such Obligor is a party,
shall be true and complete in all material respects on and as of the date
of the making of such Loan or other extension of credit (and after giving
effect thereto) with the same force and effect as if made on and as of such
date (or, if any such representation or warranty is expressly stated to
have been made as of a specific date, as of such specific date); and
(c) to the extent there are Loans outstanding under the Revolving
Credit Facility, the aggregate principal amount of such Loans together with
the aggregate amount of all Letter of Credit Liabilities shall not exceed
the Borrowing Base reflected on the most recent Borrowing Base Certificate
delivered pursuant to Section 7.04(c) of the Original Credit Agreement or
Section 9.01(f) hereof.
Each notice of borrowing or request for the issuance of a Letter of Credit by a
Borrower hereunder shall constitute a certification by such Borrower to the
effect set forth in the preceding sentence (both as of the date of such notice
or request and, unless such Borrower otherwise notifies the Administrative Agent
prior to the date of such borrowing or issuance, as of the date of such
borrowing or issuance).
7.04 CERTAIN DETERMINATIONS. For purposes of determining compliance with
the conditions specified in Section 7.02 hereof, each Lender shall be deemed to
be consented to, approved or accepted or to be satisfied with each document or
other matter required thereunder to be consented to or approved
Credit Agreement
----------------
116
- 110 -
by or acceptable or satisfactory to the Lenders unless an officer of the
Administrative Agent responsible for the transactions contemplated by the Credit
Documents shall have received notice from such Lender prior to the Restatement
Effective Date specifying its objection thereto, and such Lender shall not have
made available to the Administrative Agent such Lender's ratable portion of the
Loans to be made by it on such date.
Section 8. REPRESENTATIONS AND WARRANTIES. Each Obligor represents and
warrants to the Administrative Agent and the Lenders that:
8.01 CORPORATE EXISTENCE. Each Obligor and its Subsidiaries: (a) is a
corporation, partnership or other entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization; (b) has
all requisite corporate or other power, and has all material governmental
licenses, authorizations, consents and approvals necessary to own its assets and
carry on its business as now being or as proposed to be conducted except where
the failure to have the same could not reasonably be expected to have a Material
Adverse Effect; and (c) is qualified to do business and is in good standing as a
foreign entity in all jurisdictions in which the nature of the business
conducted by it requires such qualification except where failure so to qualify
could not reasonably be expected (either individually or in the aggregate) to
have a Material Adverse Effect.
8.02 FINANCIAL CONDITION. The Parent has heretofore furnished to each of
the Lenders the following:
(a) consolidated and consolidating balance sheets of the Parent and
its Subsidiaries as at December 31, 1995 and the related consolidated and
consolidating statements of income, retained earnings and cash flows of the
Parent and its Subsidiaries for the fiscal year ended on said date, with
the opinion thereon (in the case of said consolidated balance sheet and
statements) of Coopers & Xxxxxxx L.L.P.,
CREDIT AGREEMENT
117
- 111 -
and the unaudited consolidated and consolidating balance sheets of the
Parent and its Subsidiaries as at June 30, 1996 and the related
consolidated and consolidating statements of income, retained earnings and
cash flows of the Parent and its Subsidiaries for the six-month period
ended on such date; and
(b) consolidated and consolidating balance sheets of Alflex and its
Subsidiaries as at March 31, 1996 and the related consolidated and
consolidating statements of income, retained earnings and cash flows of
Alflex and its Subsidiaries for the fiscal year ended on said date, with
the opinion thereon (in the case of said consolidated balance sheet and
statements) of Ernst & Young L.L.P., and the unaudited consolidated and
consolidating balance sheets of Alflex and its Subsidiaries as at June 30,
1996 and the related consolidated and consolidating statements of income,
retained earnings and cash flows of Alflex and its Subsidiaries for the
three-month period ended on such date.
All such financial statements fairly present, in all material respects, the
consolidated financial condition of the Parent and its Subsidiaries and Alflex
and its Subsidiaries, as the case may be, and (in the case of said consolidating
financial statements) the respective unconsolidated financial condition of the
Parent and its Subsidiaries and Alflex and its Subsidiaries, as the case may be,
as at said dates and the consolidated and unconsolidated results of their
respective operations for the fiscal years and periods ended on said dates
(subject, in the case of such financial statements as at June 30, 1996, to
normal year-end audit adjustments), all in accordance with generally accepted
accounting principles and practices applied on a consistent basis. Except as
otherwise disclosed to the Administrative Agent or the Lenders in writing prior
to the date hereof, none of the Parent nor any of its Subsidiaries has on the
date hereof any material contingent liabilities, liabilities for taxes, unusual
forward or long-term commitments or unrealized or anticipated losses from any
unfavorable commitments, except as referred to or reflected or provided for in
said balance sheets as at said
Credit Agreement
----------------
118
- 112 -
dates. Since December 31, 1995 (in the case of
the Parent and its Subsidiaries (other than Alflex and its Subsidiaries)) or
March 31, 1996 (in the case of Alflex and its Subsidiaries):
(i) there has been no material adverse change in the business,
properties, assets, operations, conditions (financial or otherwise), or
prospects of Alflex and its Subsidiaries, taken as a whole; and
(ii) other than the Merger, there has been no material adverse change
in the business, properties, assets, operations, conditions (financial or
otherwise), or prospects of the Parent and its Subsidiaries (including
CALI, but excluding Alflex and its Subsidiaries) taken as a whole.
8.03 LITIGATION. Except as disclosed in Schedule II hereto, there are no
legal or arbitral proceedings, or any proceedings by or before any governmental
or regulatory authority or agency, now pending or (to the knowledge of any
Obligor) threatened against any Obligor or any of its Subsidiaries that could
reasonably be expected (either individually or in the aggregate) to have a
Material Adverse Effect.
8.04 NO BREACH. Except as disclosed in Schedule III hereto, none of the
execution and delivery of this Agreement and the Notes and the other Basic
Documents, the consummation of the transactions herein and therein contemplated
or compliance with the terms and provisions hereof and thereof will conflict
with or result in a breach of, or require any consent under, the charter or
by-laws of any Obligor or any of its Subsidiaries, or any applicable law or
regulation, or any order, writ, injunction or decree of any court or
governmental authority or agency, or any material agreement or instrument to
which it or any of its Subsidiaries is a party or by which any of them or any of
their Property is bound or to which any of them is subject, or constitute a
default under any such agreement or instrument, or (except for the Liens created
pursuant to the Security Documents) result in the creation or imposition of any
Lien upon any
Credit Agreement
----------------
119
- 113 -
Property of any Obligor or any of its Subsidiaries pursuant to the terms of any
such agreement or instrument.
8.05 ACTION. Each Obligor and each of its Subsidiaries has all necessary
corporate power, authority and legal right to execute, deliver and perform its
obligations under each of the Basic Documents to which it is a party; the
execution, delivery and performance by each Obligor of each of the Basic
Documents to which it is a party have been duly authorized by all necessary
corporate action on its part; and this Agreement has been duly and validly
executed and delivered by each Obligor and constitutes, and each of the Notes
and the other Basic Documents to which it is a party when executed and delivered
by such Obligor (in the case of the Notes, for value) will constitute, its
legal, valid and binding obligation, enforceable against each Obligor in
accordance with its terms.
8.06 APPROVALS. Except for filings and recordings in respect of the Liens
created pursuant to the Security Documents and the other filings and recordings
identified on Schedule IV hereto, no authorizations, approvals or consents of,
and no filings or registrations with, any governmental or regulatory authority
or agency, or any securities exchange, are necessary for the execution, delivery
or performance by any Obligor of this Agreement or any of the other Basic
Documents to which it is a party or for the legality, validity or enforceability
hereof or thereof.
8.07 USE OF CREDIT. No Obligor nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose, whether immediate, incidental or ultimate, of buying or
carrying Margin Stock. After applying the proceeds of each Loan, not more than
25% of the value of the assets of any Obligor and such Obligor's Subsidiaries
(as determined in good faith by such Obligor) will consist of or be represented
by Margin Stock. Neither the making of any of the Loans nor issuance of the
Letters of Credit nor the use of the proceeds thereof will
Credit Agreement
----------------
120
- 114 -
violate or be inconsistent with the provisions of Regulations G, U or X.
8.08 ERISA. Each Plan, and, to the knowledge of the Parent, each
Multiemployer Plan, is in compliance in all material respects with, and has been
administered in all material respects in compliance with, the applicable
provisions of ERISA, the Code and any other Federal or State law, except where
such non-compliance thereof could not reasonably be expected to lead to a
material liability, and no event or condition has occurred and is continuing as
to which any Obligor (or, prior to the Merger, CasTech) would be under an
obligation to furnish a report to the Lenders under Section 9.01(e) hereof,
unless such event or condition could not reasonably be expected to lead to a
material liability.
8.09 TAXES.
(a) The Parent and its Subsidiaries are members of an affiliated group of
corporations filing consolidated returns for Federal income tax purposes, of
which the Parent is the "common parent" (within the meaning of Section 1504 of
the Code) of such group.
(b) The Parent and its Subsidiaries have filed all Federal income tax
returns and all other material tax returns that are required to be filed by them
and have paid all taxes due pursuant to such returns or pursuant to any
assessment received by them or any of their respective Subsidiaries, subject to
any extensions granted so long as no penalty shall be due in relation thereto.
The charges, accruals and reserves on the books of the Parent and its
Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of the Parent, adequate. Neither the Parent nor any of its Subsidiaries
has given or been requested to give a waiver of the statute of limitations
relating to the payment of any Federal, state, local and foreign taxes or other
impositions.
Credit Agreement
----------------
121
- 115 -
8.10 INVESTMENT COMPANY ACT. Neither the Parent nor any of its Subsidiaries
is an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
8.11 PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Parent nor any of its
Subsidiaries is a "holding company", or an "affiliate" of a "holding company" or
a "subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
8.12 MATERIAL AGREEMENTS AND LIENS.
(a) Part A of Schedule V hereto is a complete and correct list of each
credit agreement, loan agreement, indenture, purchase agreement, guarantee,
letter of credit or other arrangement providing for or otherwise relating to any
Indebtedness or any extension of credit (or commitment for any extension of
credit) to, or guarantee by, the Parent and its Subsidiaries outstanding on the
date hereof, or that (after giving effect to the transactions contemplated to
occur on or before the Restatement Effective Date) will be outstanding on the
Restatement Effective Date, and the aggregate principal or face amount
outstanding or that may become outstanding under each such arrangement is
correctly described in Part A of said Schedule V.
(b) Part B of Schedule V hereto is a complete and correct list of each Lien
securing Indebtedness of any Person outstanding on the date hereof, or that
(after giving effect to the transactions contemplated to occur on or before the
Restatement Effective Date) will be outstanding on the Restatement Effective
Date, covering any Property of the Parent or any of its Subsidiaries, and the
aggregate Indebtedness secured (or that may be secured) by each such Lien and
the Property covered by each such Lien is correctly described in Part B of said
Schedule V.
8.13 ENVIRONMENTAL MATTERS. Except as set forth on Schedule VI hereto or as
could not reasonably be expected (either
Credit Agreement
----------------
122
- 116 -
individually or in the aggregate) to have a Material Adverse Effect:
(a) Each of the Parent and its Subsidiaries has obtained all
environmental, health and safety permits, licenses and other authorizations
required under all Environmental Laws to carry on its business as being
conducted, and each of such permits, licenses and authorizations is in full
force and effect and each of the Parent and its Subsidiaries is in
compliance with the terms and conditions thereof, and is also in compliance
with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained
in any applicable Environmental Law or in any regulation, code, plan,
order, decree, judgment, injunction, notice or demand letter issued,
entered, promulgated or approved thereunder.
(b) No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been filed, no
penalty has been assessed and, to the Parent's or any of its Subsidiaries'
knowledge, no investigation or review is pending or threatened by any
governmental or other entity with respect to any alleged failure by the
Parent or any of its Subsidiaries to have any environmental, health or
safety permit, license or other authorization required under any
Environmental Law in connection with the conduct of the business of the
Parent or any of its Subsidiaries or with respect to any generation,
treatment, storage, recycling, transportation, discharge or disposal, or
any Release of any Hazardous Materials generated by the Parent or any of
its Subsidiaries.
(c) Neither the Parent nor any of its Subsidiaries owns, operates or
leases a treatment, storage or disposal facility requiring a permit under
the Resource Conservation and Recovery Act of 1976, as amended; and
Credit Agreement
----------------
123
- 117 -
(i) no polychlorinated biphenyls (PCB's) are or have been present
at any site or facility now or previously owned, operated or leased by
the Parent or any of its Subsidiaries;
(ii) no Hazardous Materials have been Released at, on or under
any site or facility now or previously owned, operated or leased by
the Parent or any of its Subsidiaries in a reportable quantity
established by statute, ordinance, rule, regulation or order; and
(iii) no Hazardous Materials have been otherwise Released at, on
or under any site or facility now or previously owned, operated or
leased by the Parent or any of its Subsidiaries.
(d) Neither the Parent nor any of its Subsidiaries has transported or
arranged for the transportation of any Hazardous Material to any location
that is listed on the National Priorities List ("NPL") under the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended ("CERCLA"), listed for possible inclusion on the NPL by
the Environmental Protection Agency in the Comprehensive Environmental
Response and Liability Information System, as provided for by 40 C.F.R. '
300.5 ("CERCLIS"), or on any similar state or local list or that is the
subject of Federal, state or local enforcement actions or other
investigations that could reasonably be expected to lead to Environmental
Claims against the Parent or any of its Subsidiaries.
(e) No Hazardous Material generated by the Parent or any of its
Subsidiaries has been recycled, treated, stored, disposed of or Released by
the Parent or any of its Subsidiaries in violation of Environmental Law or
that could reasonably be expected to give rise to liability under
Environmental Law.
Credit Agreement
----------------
124
- 118 -
(f) No oral or written notification of a Release of a Hazardous
Material has been filed by or on behalf of the Parent or any of its
Subsidiaries and no site or facility now or previously owned, operated or
leased by the Parent or any of its Subsidiaries is listed or proposed for
listing on the NPL, CERCLIS or any similar state list of sites requiring
investigation or clean-up.
(g) No Liens have arisen under or pursuant to any Environmental Laws
on any site or facility owned, operated or leased by the Parent or any of
its Subsidiaries, and no government action has been taken or is known by
the Parent or any such Subsidiary to be in process that could reasonably be
expected to subject any such site or facility to such Liens and neither the
Parent nor any of its Subsidiaries would be required to place any notice or
restriction relating to the presence of Hazardous Materials at any site or
facility owned by it in any deed to the real property on which such site or
facility is located.
(h) The Parent and its Subsidiaries have made available to the
Administrative Agent certain environmental investigations, studies, audits,
tests, reviews or other analyses conducted by or that are in the possession
of the Parent or any of its Subsidiaries with respect to all matters
relating to facts, circumstances or conditions at or affecting any site or
facility now or previously owned, operated or leased by the Parent or any
of its Subsidiaries and that, to the Parent's knowledge, could reasonably
be expected (either individually or in the aggregate) to have resulted in a
Material Adverse Effect.
Credit Agreement
----------------
125
- 119 -
8.14 CAPITALIZATION.
(a) Part A of Schedule VII hereto correctly sets forth the authorized
Capital Stock of the Parent on the date hereof. All of the issued and
outstanding shares of each class of Capital Stock of the Parent on the date
hereof are duly and validly issued, fully paid and nonassessable. On the date
hereof, except as disclosed in Part B of said Schedule VII, (x) there are no
outstanding Equity Rights with respect to the Parent and there are no
outstanding obligations of the Parent or any or any of its Subsidiaries to
repurchase, redeem, or otherwise acquire any shares of Capital Stock of the
Parent, and (y) are there no outstanding obligations of the Parent or any of its
Subsidiaries to make payments to any Person, such as "phantom stock" payments,
where the amount thereof is calculated with reference to the fair market value
or equity value of the Parent or any of its Subsidiaries.
(b) Part A of Schedule VIII hereto correctly sets forth the authorized
Capital Stock of Holdings on the date hereof. All of the issued and outstanding
shares of each class of Capital Stock of Holdings on the date hereof are duly
and validly issued, fully paid and nonassessable. On the date hereof all of such
issued and outstanding shares of Capital Stock are owned beneficially and of
record by the Parent. On the date hereof, except as disclosed in Part B of said
Schedule VIII, there are no outstanding Equity Rights with respect to Holdings
and there are no outstanding obligations of the Parent or any or any of its
Subsidiaries to repurchase, redeem, or otherwise acquire any shares of Capital
Stock of Holdings.
(c) Part A of Schedule IX hereto correctly sets forth the authorized
Capital Stock of CALI on the date hereof. All of the issued and outstanding
shares of each class of Capital Stock of CALI on the date hereof are duly and
validly issued, fully paid and nonassessable. On the date hereof all of such
issued and outstanding shares of Capital Stock are owned beneficially and of
record by Holdings. On the date hereof, except as
Credit Agreement
----------------
126
- 120 -
disclosed in Part B of said Schedule IX, there are no outstanding Equity Rights
with respect to CALI and there are no outstanding obligations of the Parent or
any or any of its Subsidiaries to repurchase, redeem, or otherwise acquire any
shares of Capital Stock of CALI.
(d) Part A of Schedule X hereto correctly sets forth the authorized Capital
Stock of Alflex on the date hereof. All of the issued and outstanding shares of
each class of Capital Stock of Alflex are fully paid and nonassessable. On the
date hereof all of such issued and outstanding shares of Capital Stock are owned
beneficially and of record by Holdings. On the date hereof, except as disclosed
in Part B of said Schedule X, (x) there are no outstanding Equity Rights with
respect to the Alflex and there are no outstanding obligations of the Parent or
any of its Subsidiaries to repurchase, redeem, or otherwise acquire any shares
of Capital Stock of Alflex and (y) are there no outstanding obligations of the
Parent or any of its Subsidiaries to make payments to any Person, such as
"phantom stock" payments, where the amount thereof is calculated with reference
to the fair market value or equity value of Alflex or any of its Subsidiaries
(other than rights arising under Section 262 of the Delaware General Corporation
Law in connection with the Acquisition).
(e) Part A of Schedule XI hereto correctly sets forth the authorized
Capital Stock of Barmet on the date hereof. All of the issued and outstanding
shares of each class of Capital Stock of Barmet are fully paid and
nonassessable. On the date hereof all of such issued and outstanding shares of
Capital Stock are owned beneficially and of record by Alflex. On the date
hereof, except as disclosed in Part B of said Schedule XI, (x) there are no
outstanding Equity Rights with respect to the Barmet and there are no
outstanding obligations of the Parent or any of its Subsidiaries to repurchase,
redeem, or otherwise acquire any shares of Capital Stock of Barmet and (y) are
there no outstanding obligations of the Parent or any of its Subsidiaries to
make payments to any Person, such as "phantom stock" payments, where the amount
thereof is calculated with
Credit Agreement
----------------
127
- 121 -
reference to the fair market value or equity value of Barmet or any of its
Subsidiaries.
8.15 SUBSIDIARIES, ETC.
(a) Set forth in Part A of Schedule XII hereto is a complete and correct
list of all of the Subsidiaries of the Parent on the date hereof, together with,
for each such Subsidiary, (i) the jurisdiction of organization of such
Subsidiary, (ii) each Person holding ownership interests in such Subsidiary and
(iii) the nature of the ownership interests held by each such Person and the
percentage of ownership of such Subsidiary represented by such ownership
interests. Except as disclosed in Part A of said Schedule XII, as of the date
hereof, (x) each of the Parent and its Subsidiaries owns, free and clear of
Liens (other than Liens created pursuant to the Security Documents), and has the
unencumbered right to vote, all outstanding ownership interests in each Person
shown to be held by it in Part A of said Schedule XII, (y) all of the issued and
outstanding Capital Stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (z) there are no outstanding
Equity Rights with respect to such Person.
(b) Set forth in Part B of Schedule XII hereto is a complete and correct
list of all Investments (other than Investments disclosed in Part A of said
Schedule XII) held by the Parent or any of its Subsidiaries on the date hereof
and, for each such Investment, (x) the identity of the Person or Persons holding
such Investment and (y) the nature of such Investment. Except as disclosed in
Part B of said Schedule XII, each of the Parent and its Subsidiaries owns, free
and clear of all Liens (other than Liens created pursuant to the Security
Documents), all such Investments.
(c) None of the Subsidiaries of the Parent is, on the date hereof, subject
to any indenture, agreement, instrument or other arrangement of the type
described in Section 9.17(c) hereof.
Credit Agreement
----------------
128
- 122 -
8.16 TITLE TO ASSETS. Except as disclosed in Schedule XIII hereto, each of
the Parent and its Subsidiaries owns and has on the date hereof good and
marketable title (subject only to Liens permitted by Section 9.06 hereof) to the
Properties shown to be owned in the most recent financial statements referred to
in Section 8.02 hereof (other than Properties disposed of in the ordinary course
of business or otherwise permitted to be disposed of pursuant to Section 9.05
hereof). Each of the Parent and its Subsidiaries owns and has on the date hereof
good and marketable title to, or (in the case of any real property leases), a
valid and subsisting leasehold estate in and to, and enjoys on the date hereof
peaceful and undisturbed possession of, all Properties (subject only to Liens
permitted by Section 9.06 hereof) that are necessary for the operation and
conduct of its businesses.
8.17 TRUE AND COMPLETE DISCLOSURE. The information, reports, financial
statements, exhibits and schedules furnished in writing by or on behalf of the
Obligors to the Administrative Agent or any Lender in connection with the
negotiation, preparation or delivery of this Agreement and the other Credit
Documents or included herein or therein or delivered pursuant hereto or thereto,
when taken as a whole (together with the Information Memorandum) do not contain
any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading. All written
information furnished after the date hereof by the Parent and its Subsidiaries
to the Administrative Agent and the Lenders in connection with this Agreement
and the other Credit Documents and the transactions contemplated hereby and
thereby will be true, complete and accurate in every material respect, or (in
the case of projections) based on reasonable estimates, on the date as of which
such information is stated or certified. There is no fact known to any Obligor
that could reasonably be expected (either individually or in the aggregate) to
have a Material Adverse Effect that has not been disclosed herein, in the other
Credit Documents or in a report, financial statement, exhibit,
Credit Agreement
----------------
129
- 123 -
schedule, disclosure letter or other writing furnished to the Lenders for use in
connection with the transactions contemplated hereby or thereby.
8.18 REAL PROPERTY. Set forth on Schedule XIV hereto is a list, as of the
date hereof, of all of the real property interests held by the Parent and its
Subsidiaries, indicating in each case whether the respective Property is owned
or leased, the identity of the owner or lessee and the location of the
respective Property.
8.19 SECURITY DOCUMENTS. The Security Documents create, as security for the
obligations purported to be secured thereby, a valid and enforceable perfected
security interest in and Lien on all of the Properties to be covered thereby in
favor of the Administrative Agent, superior to and prior to the right of all
third Persons and subject to no other Liens (other than Liens permitted under
Section 9.06 hereof).
Section 9. COVENANTS OF THE OBLIGORS. Each Obligor covenants and agrees
with the Lenders and the Administrative Agent that, so long as any Commitment,
Loan or Letter of Credit Liability is outstanding and until payment in full of
all amounts payable by the Borrowers hereunder:
Credit Agreement
----------------
130
- 124 -
9.01 FINANCIAL STATEMENTS, ETC. The Parent (for itself and on behalf of
each other Obligor) shall deliver to each of the Lenders:
(a) as soon as available and in any event within 45 days after the end
of each quarterly fiscal period of each fiscal year of the Parent,
consolidated and consolidating statements of income, retained earnings and
cash flows of the Parent and its Subsidiaries for such period and for the
period from the beginning of the respective fiscal year to the end of such
period, and the related consolidated and consolidating balance sheets of
the Parent and its Subsidiaries as at the end of such period, setting forth
in each case in comparative form the corresponding consolidated and
consolidating figures for the corresponding periods in the preceding fiscal
year (PROVIDED that, until four full fiscal quarters of the Parent have
elapsed since the Original Closing Date, such corresponding figures shall
be the pro forma consolidated figures furnished to the Administrative Agent
prior to the Original Closing Date), accompanied by a certificate of a
Responsible Officer of the Parent, which certificate shall state that said
consolidated financial statements fairly present in all material respects
the consolidated financial condition and results of operations of the
Parent and its Subsidiaries, and said consolidating financial statements
fairly present in all material respects the respective individual
unconsolidated financial condition and results of operations of the Parent
and of each of its Subsidiaries, in each case in accordance with generally
accepted accounting principles, consistently applied, as at the end of, and
for, such period (subject to normal year-end audit adjustments);
(b) as soon as available and in any event within 90 days after the end
of each fiscal year of the Parent, consolidated and consolidating
statements of income, retained earnings and cash flows of the Parent and
its Subsidiaries for such fiscal year and the related
CREDIT AGREEMENT
131
- 125 -
consolidated and consolidating balance sheets of the Parent and its
Subsidiaries as at the end of such fiscal year, setting forth in each case
in comparative form the corresponding consolidated and consolidating
figures for the preceding fiscal year (PROVIDED that, until a full fiscal
year of the Parent has elapsed since the Original Closing Date, such
corresponding figures shall be the pro forma consolidated figures furnished
to the Administrative Agent prior to the Original Closing Date), and
accompanied (i) in the case of said consolidated statements and balance
sheet of the Parent, by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall state that
said consolidated financial statements fairly present in all material
respects the consolidated financial condition and results of operations of
the Parent and its Subsidiaries as at the end of, and for, such fiscal year
in accordance with generally accepted accounting principles, and a
statement of such accountants to the effect that, in making the examination
necessary for their opinion, nothing came to their attention that caused
them to believe that the Parent was not in compliance with Sections
9.07(g), 9.09, 9.10 and 9.11 hereof, insofar as such Sections relate to
accounting matters, and (ii) in the case of said consolidating statements
and balance sheets, by a certificate of a senior financial officer of the
Parent, which certificate shall state that said consolidating financial
statements fairly present in all material respects the respective
individual unconsolidated financial condition and results of operations of
the Parent and of each of its Subsidiaries, in each case in accordance with
generally accepted accounting principles, consistently applied, as at the
end of, and for, such fiscal year;
(c) promptly upon their becoming available, copies of all registration
statements and regular periodic reports, if any, that the Parent or any of
its Subsidiaries shall have filed with the Commission (or any governmental
agency substituted therefor) or any national securities exchange;
Credit Agreement
----------------
132
- 126 -
(d) promptly upon the mailing thereof to the shareholders of the
Parent generally or to holders of Subordinated Indebtedness or Senior
Subordinated Debt generally, copies of all financial statements, reports
and proxy statements so mailed;
(e) as soon as possible, and in any event within 15 days after any
Obligor knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan has occurred
or exists, a statement signed by a Responsible Officer of the Parent
setting forth details respecting such event or condition and the action, if
any, that the Parent or its ERISA Affiliate proposes to take with respect
thereto (and a copy of any report or notice required to be filed with or
given to the PBGC by the Parent or an ERISA Affiliate with respect to such
event or condition):
(i) any reportable event, as defined in Section 4043(c) of ERISA
and the regulations issued thereunder, with respect to a Plan, as to
which the PBGC has not by regulation waived the requirement of Section
4043(a) of ERISA that it be notified within 30 days of the occurrence
of such event (PROVIDED that a failure to meet the minimum funding
standard of Section 412 of the Code or Section 302 of ERISA,
including, without limitation, the failure to make on or before its
due date a required installment under Section 412(m) of the Code or
Section 302(e) of ERISA, shall be a reportable event regardless of the
issuance of any waivers in accordance with Section 412(d) of the
Code); and any request for a waiver under Section 412(d) of the Code
for any Plan;
(ii) the distribution under Section 4041(c)(1)(A) of ERISA of a
notice of intent to terminate any Plan or any action taken by any
Obligor or an ERISA Affiliate to terminate any Plan;
Credit Agreement
----------------
000
- 000 -
(xxx) the institution by the PBGC of proceedings under Section
4042 of ERISA for the termination of, or the appointment of a trustee
to administer, any Plan, or the receipt by any Obligor or any ERISA
Affiliate of a notice from a Multiemployer Plan that such action has
been taken by the PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a Multiemployer Plan
by any Obligor or any ERISA Affiliate that results in liability under
Section 4201 or 4204 of ERISA (including the obligation to satisfy
secondary liability as a result of a purchaser default) or the receipt
by any Obligor or any ERISA Affiliate of notice from a 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 of ERISA;
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against any Obligor or any ERISA Affiliate to
enforce Section 515 of ERISA, which proceeding is not dismissed within
30 days; and
(vi) the adoption of an amendment to any Plan that, pursuant to
Section 401(a)(29) of the Code or Section 307 of ERISA, would result
in the loss of tax-exempt status of the trust of which such Plan is a
part if any Obligor or an ERISA Affiliate fails to timely provide
security to the Plan in accordance with the provisions of said
Sections;
(f) as soon as available and in any event within 15 Business Days
after the end of each monthly accounting period (ending on the last day of
each calendar month), a Borrowing Base Certificate of the Parent as at the
last day of such accounting period;
Credit Agreement
----------------
134
- 128 -
(g) periodically at the request of the Administrative Agent or the
Majority Lenders, a report of an independent collateral auditor (which may
be, or be affiliated with, one of the Lenders) selected by the
Administrative Agent and reasonably acceptable to the Parent with respect
to the Receivables and Inventory components included in the Borrowing Base
as at the end of any monthly accounting period, which report shall indicate
that, based upon a review by such auditors of the Receivables (including,
without limitation, verification with respect to the amount, aging,
identity and credit of the respective account debtors and the billing
practices of the Parent and its Subsidiaries) and Inventory (including,
without limitation, verification as to the value, location and respective
types), the information set forth in the Borrowing Base Certificate
delivered by the Parent as at the end of such accounting period is accurate
and complete in all material respects and in addition, as soon as available
and in any event within 45 days after the end of each fiscal year of the
Parent, a like report of independent public accountants of recognized
national standing with respect to the Receivables and Inventory components
included in the Borrowing Base as at the end of such fiscal year;
(h) promptly after any Responsible Officer of any Obligor knows or has
reason to believe that any Default has occurred, a notice of such Default
describing the same in reasonable detail and, together with such notice or
as soon thereafter as possible, a description of the action that the
Obligors have taken or propose to take with respect thereto; and
(i) from time to time such other information regarding the financial
condition, operations, business or prospects of the Parent or any of its
Subsidiaries (including, without limitation, any Plan or Multiemployer Plan
and any reports or other information required to be filed under ERISA) as
any Lender or the Administrative Agent may reasonably request.
Credit Agreement
----------------
135
- 129 -
The Parent will furnish to each Lender, at the time it furnishes each set of
financial statements pursuant to paragraph (a) or (b) above, (i) a certificate
of a Responsible Officer of the Parent (x) to the effect that no Default has
occurred and is continuing (or, if any Default has occurred and is continuing,
describing the same in reasonable detail and describing the action that the
Obligors have has taken or propose to take with respect thereto) and (y) setting
forth in reasonable detail the computations necessary to determine whether the
Obligors are in compliance with Sections 9.07(g), 9.08(i), 9.09, 9.10 and 9.11
hereof as of the end of the respective quarterly fiscal period or fiscal year
and (ii) the certificate referred to in the definition of "Applicable Pricing
Level" in Section 1.01 hereof setting forth in reasonable detail the computation
of the Senior Indebtedness to EBITDA Ratio as at the end of the respective
quarterly fiscal period.
9.02 LITIGATION. The Parent (for itself and on behalf of each other
Obligor) will promptly give to each Lender notice of all legal or arbitral
proceedings, and of all proceedings by or before any governmental or regulatory
authority or agency, and any material development in respect of such legal or
other proceedings, affecting the Parent or any of its Subsidiaries, except
proceedings that could not reasonably be expected (either individually or in the
aggregate) to have a Material Adverse Effect. Without limiting the generality of
the foregoing, the Parent will give to each Lender notice of the assertion of
any Environmental Claim by any Person against, or with respect to the activities
of, the Parent or any of its Subsidiaries and notice of any alleged violation of
or non-compliance with any Environmental Laws or any permits, licenses or
authorizations, other than any Environmental Claim or alleged violation that
could not reasonably be expected (either individually or in the aggregate) to
have a Material Adverse Effect.
9.03 EXISTENCE, ETC. The Parent will, and will cause each of its
Subsidiaries to:
Credit Agreement
----------------
136
- 130 -
(a) preserve and maintain its legal existence and all of its material
rights, privileges, licenses and franchises (PROVIDED that nothing in this
Section 9.03 shall prohibit any transaction expressly permitted under
Section 9.05 hereof);
(b) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if failure
to comply with such requirements could reasonably be expected (either
individually or in the aggregate) to have a Material Adverse Effect;
(c) pay and discharge all taxes, assessments and governmental charges
or levies imposed on it or on its income or profits or on any of its
Property prior to the date on which penalties attach thereto, except for
any such tax, assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and against which
adequate reserves are being maintained;
(d) maintain all of its Properties used or useful in its business in
good working order and condition, ordinary wear and tear excepted;
(e) keep adequate records and books of account, in which complete
entries will be made in accordance with generally accepted accounting
principles consistently applied; and
(f) permit representatives of any Lender or the Administrative Agent,
during normal business hours, to examine, copy and make extracts from its
books and records, to inspect any of its Properties, and to discuss its
business and affairs with its officers, all to the extent reasonably
requested by such Lender or the Administrative Agent (as the case may be).
Credit Agreement
----------------
137
- 131 -
9.04 INSURANCE. The Parent will, and will cause each of its Subsidiaries
to, maintain insurance with financially sound and reputable insurance companies,
and with respect to Property and risks of a character usually maintained by
corporations engaged in the same or similar business similarly situated, against
loss, damage and liability of the kinds and in the amounts customarily
maintained by such corporations.
The Parent will in any event maintain (with respect to itself and each of
its Subsidiaries):
(1) CASUALTY INSURANCE -- insurance against loss or damage covering
all of the tangible real and personal Property and improvements of the
Parent and each of its Subsidiaries by reason of any Peril (as defined
below) in such amounts (subject to such deductibles as shall be
satisfactory to the Majority Lenders) as shall be reasonable and customary
and sufficient to avoid the insured named therein from becoming a
co-insurer of any loss under such policy but in any event in an amount (i)
in the case of fixed assets and equipment (other than vehicles), at least
equal to 100% of the actual replacement cost of such assets (including,
without limitation, foundation, footings and excavation costs), subject to
deductibles as aforesaid and (ii) in the case of inventory, not less than
the fair market value thereof, subject to deductibles as aforesaid.
(2) AUTOMOBILE LIABILITY INSURANCE FOR BODILY INJURY AND PROPERTY
DAMAGE -- insurance against liability for bodily injury and property damage
in respect of all vehicles (whether owned, hired or rented by the Parent or
any of its Subsidiaries) at any time located at, or used in connection
with, its Properties or operations in such amounts as are then customary
for vehicles used in connection with similar Properties and businesses, but
in any event to the extent required by applicable law.
(3) COMPREHENSIVE GENERAL LIABILITY INSURANCE --insurance against
claims for bodily injury, death or
Credit Agreement
----------------
138
- 132 -
Property damage occurring on, in or about the Properties (and adjoining
streets, sidewalks and waterways) of the Parent and its Subsidiaries, in
such amounts as are then customary for Property similar in use in the
jurisdictions where such Properties are located.
(4) WORKERS' COMPENSATION INSURANCE -- workers' compensation insurance
or a qualified self-insurance program (including, without limitation,
Employers' Liability Insurance) to the extent required by applicable law.
(5) PRODUCT LIABILITY INSURANCE -- insurance against claims for bodily
injury, death or Property damage resulting from the use of products sold by
the Parent or any of its Subsidiaries in such amounts as are then
customarily maintained by responsible persons engaged in businesses similar
to that of the Parent and its Subsidiaries.
(6) BUSINESS INTERRUPTION INSURANCE -- insurance against loss of
operating income by reason of any Peril in such amounts as are consistent
with the coverages in place on the date hereof.
(7) OTHER INSURANCE -- such other insurance, including, without
limitation, War-Risk Insurance when and to the extent obtainable from the
United States Government, in each case as generally carried by owners of
similar Properties in the jurisdictions where such Properties are located,
in such amounts and against such risks as are then customary for Property
similar in use.
Such insurance shall be written by financially responsible companies selected by
the Parent and having an A. M. Best rating of "A-" or better and being in a
financial size category of XI or larger (or, with respect to companies providing
insurance on the date hereof, a financial size category of IX or larger), or by
other companies acceptable to the Majority Lenders, and (other than workers'
compensation) shall name the Administrative Agent as loss payee (to the extent
covering risk of loss or damage to
Credit Agreement
----------------
139
- 133 -
tangible property) and as an additional named insured as its interests may
appear (to the extent covering any other risk). Each policy referred to in this
Section 9.04 shall provide that it will not be canceled or reduced, or allowed
to lapse without renewal, except after not less than 30 days' notice to the
Administrative Agent and shall also provide that the interests of the
Administrative Agent and the Lenders shall not be invalidated by any act or
negligence of the Parent or any Person having an interest in any Property
covered by the Mortgage nor by occupancy or use of any such Property for
purposes more hazardous than permitted by such policy nor by any foreclosure or
other proceedings relating to such Property. The Parent will advise the
Administrative Agent promptly of any policy cancellation, reduction or
amendment.
On or before the Restatement Effective Date, the Parent will deliver to the
Administrative Agent certificates of insurance satisfactory to the
Administrative Agent evidencing the existence of all insurance required to be
maintained by the Parent hereunder setting forth the respective coverages,
limits of liability, carrier, policy number and period of coverage and showing
that such insurance will remain in effect through the March 31 falling after the
date hereof, subject only to the payment of premiums as they become due (and
attaching original copies of any policies with respect to casualty insurance).
Thereafter, on each March 31 and October 31 in each year (commencing with the
first March 31 after the date hereof), the Parent will deliver to the
Administrative Agent certificates of insurance evidencing that all insurance
required to be maintained by the Parent hereunder will be in effect through the
following October 31 or March 31, as the case may be, subject only to the
payment of premiums as they become due. In addition, the Parent will not modify
any of the provisions of any policy with respect to casualty insurance without
delivering the original copy of the endorsement reflecting such modification to
the Administrative Agent accompanied by a written report of any firm of
independent insurance brokers of nationally recognized standing satisfactory to
the Administrative Agent, stating that, in their opinion, such policy (as so
modified) adequately protects the interests of the
Credit Agreement
----------------
140
- 134 -
Lenders and the Administrative Agent, is in compliance with the provisions of
this Section 9.04, and is comparable in all respects with insurance carried by
responsible owners and operators of Properties similar to those covered by the
Mortgages. The Parent will not obtain or carry separate insurance concurrent in
form or contributing in the event of loss with that required by this Section
9.04 unless the Administrative Agent is the named insured thereunder, with loss
payable as provided herein. The Parent will immediately notify the
Administrative Agent whenever any such separate insurance is obtained and shall
deliver to the Administrative Agent the certificates evidencing the same.
Without limiting the obligations of the Parent under the foregoing
provisions of this Section 9.04, in the event the Parent shall fail to maintain
in full force and effect insurance as required by the foregoing provisions of
this Section 9.04, then the Administrative Agent may, but shall have no
obligation so to do, procure insurance covering the interests of the Lenders and
the Administrative Agent in such amounts and against such risks as the
Administrative Agent (or the Majority Lenders) shall deem appropriate, and the
Parent shall reimburse the Administrative Agent in respect of any premiums paid
by the Administrative Agent in respect thereof.
For purposes hereof, the term "PERIL" shall mean, collectively, fire,
lightning, windstorm, hail, explosion, riot and civil commotion, vandalism and
malicious mischief, damage from aircraft, vehicles and smoke and all other
perils covered by the "all-risk" endorsement then in use in the jurisdictions
where the Properties of the Parent and its Subsidiaries are located.
Notwithstanding the foregoing, the Parent and each of its Subsidiaries may carry
a portion of the insurance required hereunder through self-insurance
arrangements with a Subsidiary described in Section 9.08(h) hereof, PROVIDED
that such self-insurance is maintained only in amounts and in a manner that is
Credit Agreement
----------------
141
- 135 -
prudent and consistent with current market practices for such insurance coverage
of corporations engaged in the same or similar business similarly situated.
9.05 PROHIBITION OF FUNDAMENTAL CHANGES.
(a) The Parent will not, nor will it permit any of its Subsidiaries to,
enter into any transaction of merger or consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution)
other than the Merger.
(b) The Parent will not, nor will it permit any of its Subsidiaries to,
acquire any business or Property from, or Capital Stock of, or be a party to any
acquisition of, any Person except for (i) purchases of inventory and other
Property to be sold or used in the ordinary course of business, (ii) Investments
permitted under Section 9.08 hereof, (iii) Capital Expenditures permitted under
Section 9.11 hereof and (iv) Permitted Reinvestment Capital Expenditures.
(c) The Parent will not, nor will it permit any of its Subsidiaries to,
convey, sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, any part of its business or Property, whether now owned
or hereafter acquired, including, without limitation, Receivables and leasehold
interests, but excluding:
(i) obsolete or worn-out Property, tools or equipment no longer used
or useful in its business so long as the amount thereof sold in any single
fiscal year by the Parent and its Subsidiaries shall not have a fair market
value in excess of $750,000; and
(ii) any inventory or other Property sold or disposed of in the
ordinary course of business and on ordinary business terms;
Credit Agreement
----------------
142
- 136 -
(iii) (x) Receivables Sales pursuant to Permitted Receivables
Financings and (y) sales or transfers of Receivables and Related Assets for
purposes of collection in the ordinary course of business and consistent
with past practices; and
(iv) other sales of Property for fair market value (as reasonably
determined by the Parent) for cash in an aggregate amount not exceeding
$2,000,000 in any fiscal year of the Parent, so long as the Net Available
Proceeds thereof are reinvested in replacement assets as provided in
Section 2.10(b) hereof.
(d) Notwithstanding the foregoing provisions of this Section 9.05:
(i) any Subsidiary of the Parent may be merged or consolidated with or
into: (x) the Parent if the Parent shall be the continuing or surviving
corporation or (y) any other such Subsidiary; PROVIDED that (1) if any such
transaction shall be between a Subsidiary and a Wholly Owned Subsidiary,
the Wholly Owned Subsidiary shall be the continuing or surviving
corporation and (2) that if any such transaction shall be between a
Subsidiary Guarantor and a Subsidiary not a Subsidiary Guarantor, and such
Subsidiary Guarantor is not the continuing or surviving corporation, then
the continuing or surviving corporation shall have assumed all of the
obligations of such Subsidiary Guarantor hereunder and under the other
Credit Documents in a manner satisfactory to the Administrative Agent; and
(ii) any Subsidiary of the Parent may sell, lease, transfer or
otherwise dispose of any or all of its Property (upon voluntary liquidation
or otherwise) to the Parent or a Wholly Owned Subsidiary of the Parent;
PROVIDED that if any such sale is by a Subsidiary Guarantor to a Subsidiary
of the Parent not a Subsidiary Guarantor, then such Subsidiary shall have
assumed all of the obligations of such Subsidiary
Credit Agreement
----------------
143
- 137 -
Guarantor hereunder and under the other Credit Documents in a manner
satisfactory to the Administrative Agent.
9.06 LIMITATION ON LIENS. The Parent will not, nor will it permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any
of its Property, whether now owned or hereafter acquired, except:
(a) Liens created pursuant to the Security Documents;
(b) Liens in existence on the Original Closing Date and listed in Part
B of Schedule V hereto;
(c) Liens imposed by any governmental authority for taxes, assessments
or charges not yet due or that are being contested in good faith and by
appropriate proceedings if, unless the amount thereof is not material with
respect to it or its financial condition, adequate reserves with respect
thereto are maintained on the books of the Parent or the affected
Subsidiaries, as the case may be, in accordance with GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business that are not
overdue for a period of more than 30 days or that are being contested in
good faith and by appropriate proceedings and Liens securing judgments but
only to the extent for an amount and for a period not resulting in an Event
of Default under Section 10(h) hereof;
(e) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(f) deposits to secure the performance of bids, trade contracts (other
than for Indebtedness), leases, statutory obligations, surety and appeal
bonds, performance bonds and
Credit Agreement
----------------
144
- 138 -
other obligations of a like nature incurred in the ordinary course of
business;
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the
use of Property or minor imperfections in title thereto that, in the
aggregate, are not material in amount, and that do not in any case
materially interfere with the ordinary conduct of the business of the
Parent or any of its Subsidiaries;
(h) Liens on Property of any corporation that becomes a Subsidiary of
the Parent after the Original Closing Date, PROVIDED that such Liens are in
existence at the time such corporation becomes a Subsidiary of the Parent
and were not created in anticipation thereof;
(i) Liens upon real and/or tangible personal Property acquired after
the Original Closing Date (by purchase, construction or otherwise) by the
Parent or any of its Subsidiaries, each of which Liens either (A) existed
on such Property before the time of its acquisition and was not created in
anticipation thereof or (B) was created solely for the purpose of securing
Indebtedness representing, or incurred to finance, refinance or refund, the
cost (including the cost of construction) of such Property; PROVIDED that
(i) no such Lien shall extend to or cover any Property of the Parent or
such Subsidiary other than the Property so acquired and improvements
thereon and (ii) the principal amount of Indebtedness secured by any such
Lien shall at no time exceed 80% of the fair market value (as determined in
good faith by a Responsible Officer of the Parent) of such Property at the
time it was acquired (by purchase, construction or otherwise);
(j) additional Liens upon real and/or personal Property created after
the Original Closing Date, PROVIDED that the aggregate Indebtedness secured
thereby and incurred
Credit Agreement
----------------
145
- 139 -
on and after the Original Closing Date shall not exceed (i) at any time
prior to the Trigger Date, $1,000,000 in the aggregate at any one time
outstanding and (ii) at any time on or after the Trigger Date, $5,000,000
in the aggregate at any one time outstanding; and
(k) Liens upon Receivables and Related Assets to secure obligations
under Permitted Receivables Financings.
9.07 INDEBTEDNESS. The Parent will not, nor will it permit any of its
Subsidiaries to, create, incur or suffer to exist any Indebtedness except:
(a) Indebtedness to the Lenders hereunder;
(b) Indebtedness outstanding on the Original Closing Date and listed
in Part A of Schedule V hereto;
(c) (i) Indebtedness of the Parent in respect of the Senior
Subordinated Debt in an aggregate original principal amount not exceeding
$125,000,000, and (ii) subordinated Guarantees of such Indebtedness by
Subsidiaries of the Parent pursuant to the Senior Subordinated Debt
Documents;
(d) Indebtedness of Subsidiaries of the Parent to the Parent or to
other Subsidiaries of the Parent (other than a Subsidiary described in
Section 9.08(h) hereof);
(e) Indebtedness in an aggregate amount not exceeding $7,000,000 owing
by the Parent and/or certain of its Subsidiaries to Lockheed Xxxxxx
Corporation pursuant to agreements relating to the reimbursement for
certain environmental costs;
(f) obligations of the Parent and its Subsidiaries under Permitted
Receivables Financings;
(g) additional Indebtedness of Subsidiaries of the Parent incurred
after the Original Closing Date (including,
Credit Agreement
----------------
146
- 140 -
without limitation, Capital Lease Obligations and other Indebtedness
secured by Liens permitted under Section 9.06(i) or 9.06(j) hereof) up to
but not exceeding (i) at any time prior to the Trigger Date, $1,000,000 in
the aggregate at any one time outstanding and (ii) at any time on or after
the Trigger Date, $5,000,000 in the aggregate at any one time outstanding;
and
(h) obligations in respect of Interest Rate Protection Agreements and
Commodity Hedge Agreements (to the extent the same constitute Indebtedness)
permitted under Section 9.08(e) hereof.
9.08 INVESTMENTS. The Parent will not, nor will it permit any of its
Subsidiaries to, make or permit to remain outstanding any Investments except:
(a) Investments outstanding on the Original Closing Date and
identified in Part B of Schedule XI hereto;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) Investments by the Parent and Holdings in the Borrowers;
(e) (i) over-the-counter Interest Rate Protection Agreements with one
or more of the Lenders (and/or with a bank or other financial institution
having capital, surplus and undivided profits of at least $500,000,000) as
to an aggregate notional principal amount not at any time exceeding
$150,000,000; and (ii) Commodity Hedge Agreements to the extent permitted
under Section 9.19 hereof;
(f) loans or advances made to employees of the Parent or any of its
Subsidiaries in the ordinary course of business and in furtherance of the
Parent's business in an
Credit Agreement
----------------
147
- 141 -
aggregate amount not exceeding $4,000,000 at any time outstanding;
(g) in the event the Parent or any of its Subsidiaries maintains any
unfunded deferred compensation plan (within the meaning of Title I of
ERISA), to the extent benefits under such plan are defined by reference to
specific investments, whether at the participant's or the beneficiaries'
election or otherwise, any Investment in such a specific investment;
(h) Investments not to exceed $3,000,000 in the aggregate in one or
more Subsidiaries of the Parent organized solely for the purpose of
permitting the Parent and its Subsidiaries to self-insure in a usual and
customary manner consistent with current market practices for
self-insurance programs of corporations engaged in the same or similar
business similarly situated;
(i) additional Investments up to but not exceeding $5,000,000 in the
aggregate; and
(j) Investments constituting capitalization of Securitization
Subsidiaries consistent with normal practice for transactions of such type.
9.09 DIVIDEND PAYMENTS. The Parent will not, nor will it permit any of its
Subsidiaries to, declare or make any Dividend Payment at any time; PROVIDED that
the Parent may:
(a) declare and make Dividend Payments in cash, subject to the
satisfaction of each of the following conditions on the date of such
Dividend Payment and after giving effect thereto:
(i) no Default shall have occurred and be continuing;
Credit Agreement
----------------
148
- 142 -
(ii) the aggregate amount of Dividend Payments made in the form
of cash dividends on the Capital Stock of the Parent during the
then-current fiscal quarter of the Parent shall not exceed $600,000;
and
(iii) the Parent shall have delivered to each Lender, at least 10
Business Days (but not more than 20 Business Days) prior to the date
of the proposed Dividend Payment, a certificate of a Responsible
Officer of the Parent setting forth computations in reasonable detail
demonstrating satisfaction of the foregoing conditions as at the date
of such certificate;
(b) make Stock Repurchases in cash, subject to the satisfaction of
each of the following conditions on the date of such Stock Repurchase and
after giving effect thereto:
(i) no Default shall have occurred and be continuing;
(ii) at any time prior to the Trigger Date, the aggregate amount
of Stock Repurchases made in any twelve-month period shall not exceed
$3,000,000; and
(iii) at any time from and after the Trigger Date, the aggregate
amount of Stock Repurchases made in any twelve-month period shall not
exceed $8,000,000; and
(c) make Employee Stock Repurchases in cash, subject to the
satisfaction of each of the following conditions on the date of such
Employee Stock Repurchase and after giving effect thereto:
(i) no Default shall have occurred and be continuing; and
Credit Agreement
----------------
149
- 143 -
(ii) the aggregate amount of all Employee Stock Repurchases made
after the date hereof shall not exceed $6,000,000.
This Section 9.09 shall in any event not prohibit: (x) the payment of any
dividend by the Parent within 60 days after the date of declaration thereof if,
at such date of declaration, such payment would comply with the foregoing
paragraph; (y) the redemption of any Stock Purchase Rights issued under the
Stockholder Protection Rights Agreement; and (z) the payment of dividends by any
Subsidiary of the Parent to the Parent or to any other Subsidiary of the Parent.
9.10 CERTAIN FINANCIAL COVENANTS.
(a) LEVERAGE RATIOS.
(i) The Parent will not permit the Senior Leverage Ratio to
exceed the following respective ratios at any time during the
following respective periods:
Period Ratio
------ -----
From and including the first
Delivery Date after the date
hereof through but excluding
the first Delivery Date after
December 31, 1996 3.70 to 1.00
From and including the first
Delivery Date after December
31, 1996 through but
excluding the first Delivery
Date after
March 31, 1997 3.50 to 1.00
Credit Agreement
----------------
150
- 144 -
From and including the first
Delivery Date after March 31,
1997 through but excluding
the first Delivery Date after
June 30, 1997 3.00 to 1.00
From and including the first
Delivery Date after June 30,
1997 through but excluding
the first Delivery Date after
September 30, 1997 2.80 to 1.00
From and including the first
Delivery Date after September
30, 1997 through but
excluding the first Delivery
Date after
December 31, 1997 2.70 to 1.00
From and including the first
Delivery Date after December
31, 1997 through but
excluding the first Delivery
Date after
March 31, 1998 2.50 to 1.00
From and including the first
Delivery Date after March 31,
1998 through but excluding
the first Delivery Date after
June 30, 1998 2.40 to 1.00
Credit Agreement
----------------
151
- 145 -
From and including the first
Delivery Date after June 30,
1998 through but excluding
the first Delivery Date after
September 30, 1998 2.30 to 1.00
From and after the first
Delivery Date after
September 30, 1998 2.20 to 1.00
(ii) The Parent will not permit the Total Leverage Ratio to
exceed the following respective ratios at any time during the
following respective periods:
Period Ratio
------ -----
From and including the first
Delivery Date after the date
hereof through but excluding
the first Delivery Date after
December 31, 1996 5.50 to 1.00
From and including the first
Delivery Date after December
31, 1996 through but
excluding the first Delivery
Date after
March 31, 1997 5.20 to 1.00
From and including the first
Delivery Date after March 31,
1997 through but excluding
the first Delivery Date after
June 30, 1997 4.40 to 1.00
Credit Agreement
----------------
152
- 146 -
From and including the first
Delivery Date after June 30,
1997 through but excluding
the first Delivery Date after
September 30, 1997 4.20 to 1.00
From and including the first
Delivery Date after September
30, 1997 through but
excluding the first Delivery
Date after
December 31, 1997 4.00 to 1.00
From and including the first
Delivery Date after December
31, 1997 through but
excluding the first Delivery
Date after
March 31, 1998 3.80 to 1.00
From and including the first
Delivery Date after March 31,
1998 through but excluding
the first Delivery Date after
June 30, 1998 3.60 to 1.00
From and including the first
Delivery Date after June 30,
1998 through but excluding
the first Delivery Date after
September 30, 1998 3.40 to 1.00
Credit Agreement
----------------
153
- 147 -
From and including the first
Delivery Date after September
30, 1998 through but
excluding the first Delivery
Date after
December 31, 1998 3.30 to 1.00
From and after the first
Delivery Date after
December 31, 1998 3.30 to 1.00
(b) INTEREST COVERAGE RATIOS.
(i) The Parent will not permit the Senior Interest Coverage Ratio
to be less than the following respective ratios at any time during the
following respective periods:
Period Ratio
------ -----
From the date hereof
through December 31, 1996 3.80 to 1.00
From January 1, 1997
through March 31, 1997 3.80 to 1.00
From April 1, 1997
through June 30, 1997 4.50 to 1.00
From July 1, 1997
through September 30, 1997 4.80 to 1.00
From October 1, 1997
through December 31, 1997 4.90 to 1.00
From January 1, 1998
through March 31, 1998 5.00 to 1.00
Credit Agreement
----------------
154
- 148 -
From April 1, 1998
through June 30, 1998 5.30 to 1.00
From July 1, 1998
through September 30, 1998 5.60 to 1.00
From October 1, 1998
through December 31, 1998 5.80 to 1.00
From January 1, 1999
and at all times thereafter 5.80 to 1.00
(ii) The Parent will not permit the Total Interest Coverage Ratio
to be less than the following respective ratios at any time during the
following respective periods:
Period Ratio
------ -----
From the date hereof
through December 31, 1996 2.20 to 1.00
From January 1, 1997
through March 31, 1997 2.20 to 1.00
From April 1, 1997
through June 30, 1997 2.60 to 1.00
From July 1, 1997
through September 30, 1997 2.80 to 1.00
From October 1, 1997
through December 31, 1997 2.80 to 1.00
From January 1, 1998
through March 31, 1998 2.90 to 1.00
From April 1, 1998
Credit Agreement
----------------
155
- 149 -
through June 30, 1998 3.00 to 1.00
From July 1, 1998
through September 30, 1998 3.20 to 1.00
From October 1, 1998
through December 31, 1998 3.30 to 1.00
From January 1, 1999
and at all times thereafter 3.30 to 1.00
(c) MINIMUM TTM EBITDA. The Parent will not permit TTM EBITDA as at
any day during the following respective periods to be less than the
following respective amounts:
Period Amount
------ ------
From the date hereof
through December 31, 1996 $ 70,000,000
From January 1, 1997
through March 31, 1997 $ 75,000,000
From April 1, 1997
through June 30, 1997 $ 80,000,000
From July 1, 1997
through September 30, 1997 $ 85,000,000
From October 1, 1997
through December 31, 1997 $ 90,000,000
From January 1, 1998
and at all times thereafter $100,000,000
Credit Agreement
----------------
000
- 000 -
(x) FIXED CHARGES RATIO. The Parent will not permit the Fixed Charges
Ratio to be less than the following respective ratios at any time during
the following respective periods:
Period Ratio
------ -----
From the date hereof
through December 31, 1996 1.70 to 1.00
From January 1, 1997
through March 31, 1997 1.80 to 1.00
From April 1, 1997
through June 30, 1997 1.80 to 1.00
From July 1, 1997
through September 30, 1997 1.80 to 1.00
From October 1, 1997
through December 31, 1997 1.80 to 1.00
From January 1, 1998
and at all times thereafter 1.90 to 1.00
9.11 CAPITAL EXPENDITURES. The Parent will not permit the aggregate amount
of Capital Expenditures (other than Permitted Reinvestment Capital Expenditures)
by the Parent and its Subsidiaries to exceed the following respective amounts
for the following respective periods:
Credit Agreement
----------------
157
- 151 -
Period Amount
------ ------
From the date hereof
through December 31, 1996 $ 8,000,000
Each fiscal year of the Parent
ending thereafter $38,000,000
If the aggregate amount of Capital Expenditures for any period set forth in the
schedule above shall be less than the amount set forth opposite such period in
the schedule above, then the shortfall shall be added to the amount of Capital
Expenditures permitted for the immediately succeeding (but not any other) period
and, for purposes hereof, the amount of Capital Expenditures made during any
period shall be deemed to have been made first from the permitted amount for
such period set forth in the schedule above and last from the amount of any
carryover from any previous period.
9.12 INTEREST RATE PROTECTION AGREEMENTS. The Parent will within 90 days of
the Original Closing Date enter into, and thereafter maintain in full force and
effect, one or more over-the-counter Interest Rate Protection Agreements with
one or more of the Lenders (and/or with a bank or other financial institution
having capital, surplus and undivided profits of at least $500,000,000), that
effectively enables the Borrowers (in a manner satisfactory to the
Administrative Agent) to protect itself against three-month London interbank
offered rates exceeding 8% per annum as to a notional principal amount at least
equal to $95,000,000 initially (which amount may be subject to amortization) for
a period of at least 3 years measured from the Original Closing Date.
9.13 SUBORDINATED INDEBTEDNESS. The Parent will not, nor will it permit any
of its Subsidiaries to, purchase, redeem, retire or otherwise acquire for value,
or set apart any money for a sinking, defeasance or other analogous fund for the
purchase, redemption, retirement or other acquisition of, or make any voluntary
payment or prepayment of the principal of or interest
Credit Agreement
----------------
158
- 152 -
on, or any other amount owing in respect of, any Subordinated Indebtedness,
except for regularly scheduled payments or prepayments of principal and interest
in respect thereof required pursuant to the instruments evidencing such
Subordinated Indebtedness and not prohibited by the subordination provisions
thereof.
9.14 LINES OF BUSINESS. The Parent will not, nor will it permit any of its
Subsidiaries to, engage to any substantial extent in any line or lines of
business activity other than the Aluminum Business.
9.15 TRANSACTIONS WITH AFFILIATES. Except as expressly permitted by this
Agreement, the Parent will not, nor will it permit any of its Subsidiaries to,
directly or indirectly:
(a) make any Investment in an Affiliate;
(b) transfer, sell, lease, assign or otherwise dispose of any Property
to an Affiliate;
(c) merge into or consolidate with or purchase or acquire Property
from an Affiliate; or
(d) enter into any other transaction directly or indirectly with or
for the benefit of an Affiliate (including, without limitation, Guarantees
and assumptions of obligations of an Affiliate);
PROVIDED that (i) any Affiliate who is an individual may serve as a director,
officer or employee of the Parent or any of its Subsidiaries and receive
reasonable compensation for his or her services in such capacity, (ii) the
Parent and its Subsidiaries may enter into transactions (other than extensions
of credit by the Parent or any of its Subsidiaries to an Affiliate) providing
for the leasing of Property, the rendering or receipt of services or the
purchase or sale of inventory and other Property in the ordinary course of
business if the monetary or business
Credit Agreement
----------------
159
- 153 -
consideration arising therefrom would be substantially as advantageous to the
Parent and its Subsidiaries as the monetary or business consideration that would
obtain in a comparable transaction with a Person not an Affiliate and (iii)
transactions in connection with a Permitted Receivables Financing are not
prohibited by this Section 9.15.
9.16 USE OF PROCEEDS. On the Restatement Effective Date, the Term Loans and
Revolving Credit Loans will be used as provided in Section 2.01 hereof. The
Borrowers will use the proceeds of the Revolving Credit Loans, after the
Restatement Effective Date, to finance the ongoing working capital requirements
and other general corporate purposes of the Borrowers and their respective
Subsidiaries. The Borrowers will use the proceeds of the Loans in compliance
with all applicable legal and regulatory requirements, including, without
limitation, Regulations G, T, U and X and the Securities Act of 1933 and the
Securities Exchange Act of 1934 and the regulations thereunder; PROVIDED that
neither the Administrative Agent nor any Lender shall have any responsibility as
to the use of any of such proceeds.
Credit Agreement
----------------
160
- 154 -
9.17 CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES.
(a) SUBSIDIARY GUARANTORS. In the event that the Parent or any of its
Subsidiaries shall form or acquire any new Subsidiary (other than a
Securitization Subsidiary) that the Parent or the respective Subsidiary
anticipates will not be an Immaterial Subsidiary (or, in the event that any
Immaterial Subsidiary (other than a Securitization Subsidiary) shall cease to be
an Immaterial Subsidiary), the Parent will cause such new Subsidiary (or such
Immaterial Subsidiary that ceases to be an Immaterial Subsidiary) to become a
"Subsidiary Guarantor" and/or a "Guarantor" (and, thereby, an "Obligor")
hereunder, and to pledge and grant a security interest in its Property pursuant
to the Security Documents to the Administrative Agent for the benefit of the
Lenders, pursuant to a written instrument in form and substance satisfactory to
the Administrative Agent and to deliver such proof of corporate action,
incumbency of officers, opinions of counsel and other documents as is consistent
with those delivered by each "Obligor" pursuant to the Original Closing Date or
as the Administrative Agent shall have requested.
(b) OWNERSHIP OF SUBSIDIARIES. The Parent will, and will cause each of its
Subsidiaries to, take such action from time to time as shall be necessary to
ensure that each of its Subsidiaries is a Wholly Owned Subsidiary. In the event
that any additional shares of stock shall be issued by any Subsidiary, the
respective Obligor agrees forthwith to deliver to the Administrative Agent
pursuant to the Security Documents the certificates evidencing such shares of
stock, accompanied by undated stock powers executed in blank and to take such
other action as the Administrative Agent shall request to perfect the security
interest created therein pursuant to the Security Documents.
(c) CERTAIN RESTRICTIONS. Other than pursuant to the Senior Subordinated
Debt Documents or in connection with transactions related to a Permitted
Receivables Financing, the Obligors will not permit any of their respective
Subsidiaries to
Credit Agreement
----------------
161
- 155 -
enter into, after the date hereof, any indenture, agreement, instrument or other
arrangement that, directly or indirectly, prohibits or restrains, or has the
effect of prohibiting or restraining, or imposes materially adverse conditions
upon, the incurrence or payment of Indebtedness, the granting of Liens, the
declaration or payment of dividends, the making of loans, advances or
Investments or the sale, assignment, transfer or other disposition of Property.
9.18 MODIFICATIONS OF CERTAIN DOCUMENTS.
(a) No Obligor will consent to any modification, supplement or waiver of
any of the provisions of the Acquisition Documents, the Senior Subordinated Debt
Documents, any other documents providing for or relating to Subordinated
Indebtedness, or terminate the Merger Agreement, without the prior approval of
the Majority Lenders.
(b) No Obligor will take any action to modify or supplement its articles of
incorporation or the articles of incorporation of any of its Subsidiaries, other
than modifications that do not adversely affect the interests of the Lenders,
without the prior approval of the Majority Lenders.
9.19 COMMODITY HEDGING ACTIVITIES. The Parent shall not, and shall not
permit any of its Subsidiaries to, enter into any commodity futures contract,
commodity option or other similar agreement or arrangement (collectively,
"COMMODITY HEDGE AGREEMENTS"), except the Parent and its Subsidiaries may enter
into Hedge Agreements designed to protect the Parent and its Subsidiaries
against fluctuations in the price of aluminum and commodities used in the
Aluminum Business and prices associated with customer forward sales contracts
and purchase commitments, so long as the same (a) is consistent with the
relevant Obligor's past practice or then-current industry practice in the
markets in which such Obligor operates and (b) is in accordance with the
Parent's "Price Risk Program: Briefing Summary", as the same may be amended from
time to time.
Credit Agreement
----------------
162
- 156 -
9.20 AFTER-ACQUIRED REAL ESTATE. If any Obligor or any of its Subsidiaries
shall acquire any real property, or shall lease any real property that is
material to the operation of its business, after the Original Closing Date,
other than any real property encumbered by Liens permitted by Section 9.06(i)
hereof, such Obligor or such Subsidiary, as the case may be, shall promptly
execute a Mortgage covering such real property, together with such surveys,
title insurance policies and endorsements, certificates of occupancy and such
other agreements, estoppels and consents (including agreements with lessors) as
the Administrative Agent may request, and shall deliver opinions of local
counsel and other documents as is consistent with those delivered with respect
to each Mortgage pursuant to Section 7.01(m) of the Original Credit Agreement
upon the Original Closing Date or as the Administrative Agent shall have
requested.
9.21 ACTIVITIES OF THE PARENT AND HOLDINGS.
(a) The Parent (i) will at all times own, beneficially and of record, all
of the issued and outstanding Capital Stock of Holdings (PROVIDED that this
Section 9.21(a)(i) shall not prohibit any transaction expressly permitted under
Section 9.05 hereof), (ii) will own no other Property (other than cash and
Permitted Investments, other Property incidental to its business as a holding
company and Capital Stock of its Subsidiaries), (iii) will have no Indebtedness
(other than Indebtedness hereunder and Indebtedness in respect of Subordinated
Indebtedness permitted under Section 9.07 hereof), (iv) will have no operations
other than DE MINIMIS operations incidental to its business as a holding company
and (v) in furtherance of the foregoing will not make any expenditures or incur
any liabilities other than those consistent with and reasonably necessary in the
conduct of the business of the Parent as contemplated by this Section 9.21(a).
(b) Holdings (i) will at all times own, beneficially and of record, all of
the issued and outstanding Capital Stock of each of CALI and Alflex (PROVIDED
that this Section 9.21(b)(i)
Credit Agreement
----------------
163
- 157 -
shall not prohibit any transaction expressly permitted under Section 9.05
hereof), (ii) will own no other Property (other than cash and Permitted
Investments, other Property incidental to its business as a holding company and
Capital Stock of its Subsidiaries), (iii) will have no Indebtedness (other than
Indebtedness hereunder and Indebtedness in respect of Subordinated Indebtedness
permitted under Section 9.07 hereof), (iv) will have no operations other than DE
MINIMIS operations incidental to its business as a holding company and (v) in
furtherance of the foregoing will not make any expenditures or incur any
liabilities other than those consistent with and reasonably necessary in the
conduct of the business of Holdings as contemplated by this Section 9.21(b).
Section 10. EVENTS OF DEFAULT. If one or more of the following events
(herein called "EVENTS OF DEFAULT") shall occur and be continuing:
(a) Any Obligor shall: (i) default in the payment of any principal of
any Loan or any Reimbursement Obligation when due (whether at stated
maturity or at mandatory or optional prepayment); or (ii) default in the
payment of any interest on any Loan, any fee or any other amount payable by
it hereunder or under any other Credit Document when due and such default
shall have continued unremedied for three or more days; or
(b) The Parent or any of its Subsidiaries (herein collectively called
the "RELEVANT PARTIES") shall default in the payment when due of any
principal of or interest on any of its other Indebtedness having a
principal amount in of $1,000,000 or more individually or $2,000,000 or
more for all Relevant Parties and their Subsidiaries in the aggregate; or
any event specified in any note, agreement, indenture or other document
evidencing or relating to any such Indebtedness shall occur if the effect
of such event is to cause, or (with the giving of any notice or the lapse
of time or both) to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder
Credit Agreement
----------------
164
- 158 -
or holders) to cause, such Indebtedness to become due, or to be prepaid in
full (whether by redemption, purchase, offer to purchase or otherwise),
prior to its stated maturity or to have the interest rate thereon reset to
a level so that securities evidencing such Indebtedness trade at a level
specified in relation to the par value thereof; or any Relevant Party shall
default in the payment when due of any individual amount of $1,000,000 or
more (or of amounts aggregating $2,000,000 or more) under any Interest Rate
Protection Agreement; or any event specified in any Interest Rate
Protection Agreement shall occur if the effect of such event is to cause,
or (with the giving of any notice or the lapse of time or both) to permit,
any individual termination or liquidation payment in an amount of
$1,000,000 or more (or any termination or liquidation payments aggregating
$2,000,000 or more) to become due; or
(c) Any representation, warranty or certification made or deemed made
herein or in any other Basic Document (or in any modification or supplement
hereto or thereto) by any Obligor party thereto, or any certificate
furnished to any Lender or the Administrative Agent pursuant to the
provisions hereof or thereof, shall prove to have been false or misleading
as of the time made or furnished in any material respect; or
(d) The Parent or any of the other Obligors (as applicable) shall
default in the performance of any of its obligations under any of Sections
9.01(f), 9.01(h), 9.05, 9.06, 9.07, 9.08, 9.09, 9.10, 9.11, 9.13, 9.15,
9.17(b), 9.18, 9.20 or 9.21 hereof or any Obligor shall default in the
performance of any of its obligations under Section 4.02 or 5.02 of the
Pledge and Security Agreement, or any provisions of any Mortgage; or any
Obligor shall default in the performance of any of its other obligations in
this Agreement or any other Credit Document and such default shall continue
unremedied for a period of thirty or more days after notice thereof to the
Parent by the
Credit Agreement
----------------
165
- 159 -
Administrative Agent or any Lender (through the Administrative Agent); or
(e) Any Relevant Party shall admit in writing its inability to, or be
generally unable to, pay its debts as such debts become due; or
(f) Any Relevant Party shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian,
trustee, examiner or liquidator of itself or of all or a substantial part
of its Property, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the Bankruptcy Code, (iv)
file a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts, (v)
fail to controvert in a timely and appropriate manner, or acquiesce in
writing to, any petition filed against it in an involuntary case under the
Bankruptcy Code or (vi) take any corporate action for the purpose of
effecting any of the foregoing; or
(g) A proceeding or case shall be commenced, without the application
or consent of the affected Relevant Party, in any court of competent
jurisdiction, seeking (i) its reorganization, liquidation, dissolution,
arrangement or winding-up, or the composition or readjustment of its debts,
(ii) the appointment of a receiver, custodian, trustee, examiner,
liquidator or the like of such Relevant Party or of all or any substantial
part of its Property or (iii) similar relief in respect of such Relevant
Party under any law relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts, and such proceeding or
case shall continue undismissed, or an order, judgment or decree approving
or ordering any of the foregoing shall be entered and continue unstayed and
in effect, for a period of 60 or more days; or an order for
Credit Agreement
----------------
166
- 160 -
relief against any Relevant Party shall be entered in an involuntary case
under the Bankruptcy Code; or
(h) A final judgment or judgments for the payment of money of $250,000
or more in the aggregate (exclusive of judgment amounts fully covered by
insurance where the insurer has admitted liability in respect of such
judgment) or of $500,000 or more in the aggregate (regardless of insurance
coverage) shall be rendered by one or more courts, administrative tribunals
or other bodies having jurisdiction against any Relevant Party and the same
shall not be paid discharged (or provision shall not be made for such
payment or discharge), or a stay of execution thereof shall not be
procured, within 30 days from the date of entry thereof and such Relevant
Party shall not, within said period of 30 days, or such longer period
during which execution of the same shall have been stayed, appeal therefrom
and cause the execution thereof to be stayed during such appeal; or
(i) An event or condition specified in Section 9.01(e) hereof shall
occur or exist with respect to any Plan or Multiemployer Plan and, as a
result of such event or condition, together with all other such events or
conditions specified in said Section 9.01(e), any Obligor or any ERISA
Affiliate shall incur or in the opinion of the Majority Lenders shall be
reasonably likely to incur a liability to a Plan, a Multiemployer Plan or
the PBGC (or any combination of the foregoing) that, in the reasonable
determination of the Majority Lenders, could reasonably be expected (either
individually or in the aggregate) to have a Material Adverse Effect; or
(j) There shall have been asserted against the Parent or any of its
Subsidiaries, or any predecessor in interest thereof, an Environmental
Claim that, in the judgment of the Majority Lenders is reasonably likely to
be determined adversely to the Parent or any of its Subsidiaries, and the
amount thereof (either individually or in the aggregate) is reasonably
likely to have a Material Adverse Effect (insofar
Credit Agreement
----------------
167
- 161 -
as such amount is payable by the Parent or any of its Subsidiaries, but
after deducting any portion thereof that is reasonably expected to be paid
by other creditworthy Persons jointly and severally liable therefor or the
amount of funded reserves which have been established that do not cause, or
are not reasonably likely to cause, a breach of any other provision of this
Agreement); or
(k) The Liens created by the Security Documents shall at any time not
(other than by reason of the action or inaction by the Administrative
Agent) constitute a valid and perfected Lien on the collateral intended to
be covered thereby (to the extent perfection by filing, registration,
recordation or possession is required herein or therein) in favor of the
Administrative Agent, free and clear of all other Liens (other than Liens
permitted under Section 9.06 hereof or under the respective Security
Documents), or, except for expiration in accordance with its terms, any of
the Security Documents shall for whatever reason be terminated or cease to
be in full force and effect, or the enforceability thereof shall be
contested by any Obligor;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (f) or (g) of this Section 10 with respect to any Obligor, the
Administrative Agent may, by notice to the Parent, terminate the Commitments
(including the Swingline Commitment) and/or declare the principal amount then
outstanding of, and the accrued interest on, the Loans (including all Swingline
Loans), the Reimbursement Obligations and all other amounts payable by the
Obligors hereunder and under the Notes and the other Credit Documents
(including, without limitation, any amounts payable under Section 5.05 or 5.06
hereof) to be forthwith due and payable, whereupon such amounts shall be
immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by each
Obligor; and (2) in the case of the occurrence of an Event of Default referred
to in clause (f) or (g) of this Section 10 with respect to any Obligor, the
Commitments (including the Swingline Commitment) shall
Credit Agreement
----------------
168
- 162 -
automatically be terminated and the principal amount then outstanding of, and
the accrued interest on, the Loans (including all Swingline Loans), the
Reimbursement Obligations and all other amounts payable by the Obligors
hereunder and under the Notes and the other Credit Documents (including, without
limitation, any amounts payable under Section 5.05 or 5.06 hereof) shall
automatically become immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by each Obligor.
In addition, upon the occurrence and during the continuance of any Event of
Default (if the Administrative Agent has declared the principal amount then
outstanding of, and accrued interest on, the Revolving Credit Loans and all
other amounts payable by the Obligors hereunder and under the Notes to be due
and payable), each Revolving Credit Borrower agrees that it shall, if requested
by the Administrative Agent or the Majority Revolving Credit Lenders through the
Administrative Agent (and, in the case of any Event of Default referred to in
clause (f) or (g) of this Section 10 with respect to such Borrower, forthwith,
without any demand or the taking of any other action by the Administrative Agent
or such Lenders) provide cover for the Letter of Credit Liabilities under such
Borrower's Revolving Credit Facility by paying to the Administrative Agent
immediately available funds in an amount equal to the then aggregate undrawn
face amount of all Letters of Credit under such Facility, which funds shall be
held by the Administrative Agent in the Collateral Account as collateral
security in the first instance for the Letter of Credit Liabilities under such
Facility and be subject to withdrawal only as therein provided.
Credit Agreement
----------------
000
- 000 -
Xxxxxxx 00. THE ADMINISTRATIVE AGENT.
11.01 APPOINTMENT, POWERS AND IMMUNITIES. Each Lender hereby appoints and
authorizes the Administrative Agent to act as its agent hereunder and under the
other Credit Documents with such powers as are specifically delegated to the
Administrative Agent by the terms of this Agreement and of the other Credit
Documents, together with such other powers as are reasonably incidental thereto.
The Administrative Agent (which term as used in this sentence and in Section
11.05 and the first sentence of Section 11.06 hereof shall include reference to
its affiliates and its own and its affiliates' officers, directors, employees
and agents):
(a) shall have no duties or responsibilities except those expressly
set forth in this Agreement and in the other Credit Documents, and shall
not by reason of this Agreement or any other Credit Document be a trustee
for any Lender;
(b) shall not be responsible to the Lenders for any recitals,
statements, representations or warranties contained in this Agreement or in
any other Credit Document, or in any certificate or other document referred
to or provided for in, or received by any of them under, this Agreement or
any other Credit Document, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement, any Note or
any other Credit Document or any other document referred to or provided for
herein or therein or for any failure by the Parent or any other Person to
perform any of its obligations hereunder or thereunder;
(c) shall not, except to the extent expressly instructed by the
Majority Lenders with respect to collateral security under the Security
Documents, be required to initiate or conduct any litigation or collection
proceedings hereunder or under any other Credit Document; and
Credit Agreement
----------------
000
- 000 -
(x) shall not be responsible for any action taken or omitted to be
taken by it hereunder or under any other Credit Document or under any other
document or instrument referred to or provided for herein or therein or in
connection herewith or therewith, except for its own gross negligence or
willful misconduct.
The Administrative Agent may employ agents and attorneys-in-fact and shall not
be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith. The Administrative Agent may
deem and treat the payee of a Note as the holder thereof for all purposes hereof
unless and until a notice of the assignment or transfer thereof shall have been
filed with the Administrative Agent, together with the consent of the Parent to
such assignment or transfer (to the extent required by Section 12.06(b) hereof).
11.02 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall be
entitled to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone, telecopy, telegram or
cable) reasonably believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by the Administrative Agent. As to any matters not expressly provided
for by this Agreement or any other Credit Document, the Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by the Majority
Lenders or, if provided herein, in accordance with the instructions given by all
of the Lenders as is required in such circumstance, and such instructions of
such Lenders and any action taken or failure to act pursuant thereto shall be
binding on all of the Lenders.
11.03 DEFAULTS. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default unless the Administrative
Agent has received notice from a Lender
Credit Agreement
----------------
171
- 165 -
or the Parent specifying such Default and stating that such notice is a "Notice
of Default". In the event that the Administrative Agent receives such a notice
of the occurrence of a Default, the Administrative Agent shall give prompt
notice thereof to the Lenders. The Administrative Agent shall (subject to
Section 11.07 hereof) take such action with respect to such Default as shall be
directed by the Majority Lenders, PROVIDED that, unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem advisable in
the best interest of the Lenders except to the extent that this Agreement
expressly requires that such action be taken, or not be taken, only with the
consent or upon the authorization of the Majority Lenders or all of the Lenders.
11.04 RIGHTS AS A LENDER. With respect to its Commitments and the Loans
made by it, NatWest (and any successor acting as Administrative Agent) in its
capacity as a Lender hereunder shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were not acting as
the Administrative Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Agent in its individual
capacity. NatWest (and any successor acting as Administrative Agent) and its
affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Obligors (and any of their
Subsidiaries or Affiliates) as if it were not acting as the Administrative
Agent, and NatWest (and any such successor) and its affiliates may accept fees
and other consideration from the Obligors for services in connection with this
Agreement or otherwise without having to account for the same to the Lenders.
11.05 INDEMNIFICATION. The Lenders agree to indemnify the Administrative
Agent (to the extent not reimbursed under Section 12.03 hereof, but without
limiting the obligations of the Parent under said Section 12.03) ratably in
accordance with the
Credit Agreement
----------------
172
- 166 -
aggregate principal amount of the Loans and Reimbursement Obligations held by
the Lenders (or, if no Loans or Reimbursement Obligations are at the time
outstanding, ratably in accordance with their respective Notes), for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against the Administrative Agent (including
by any Lender) arising out of or by reason of any investigation in or in any way
relating to or arising out of this Agreement or any other Credit Document or any
other documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby (including, without limitation, the
costs and expenses that the Borrowers are obligated to pay under Section 12.03
hereof, but excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof or thereof or of
any such other documents, PROVIDED that no Lender shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the party to be indemnified.
11.06 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each Lender
agrees that it has, independently and without reliance on the Administrative
Agent or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own credit analysis of the Parent and its
Subsidiaries and made its own decision to enter into this Agreement and that it
will, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or under any other Credit
Document. The Administrative Agent shall not be required to keep itself informed
as to the performance or observance by any Obligor of this Agreement or any of
the other Credit Documents or any other document referred to or provided for
herein or therein or to inspect the Properties or books of the Parent or any of
its Subsidiaries. Except for notices,
Credit Agreement
----------------
173
- 167 -
reports and other documents and information expressly required to be furnished
to the Lenders by the Administrative Agent hereunder or under the Security
Documents, the Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition or business of the Parent or any of its Subsidiaries (or any
of their affiliates) that may come into the possession of the Administrative
Agent or any of its affiliates.
11.07 FAILURE TO ACT. Except for action expressly required of the
Administrative Agent hereunder and under the other Credit Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 11.05 hereof against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action.
11.08 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Parent and the Borrowers, and the Administrative Agent
may be removed at any time with or without cause by the Majority Lenders. Upon
any such resignation or removal, the Majority Lenders shall have the right to
appoint a successor Administrative Agent. If no successor Administrative Agent
shall have been so appointed by the Majority Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent's giving
of notice of resignation or the Majority Lenders' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, that shall be a bank that
has an office in New York, New York with a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested
Credit Agreement
----------------
174
- 168 -
with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder. After any retiring Administrative
Agent's resignation or removal hereunder as Administrative Agent, the provisions
of this Section 11 shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as the
Administrative Agent.
11.09 CONSENTS UNDER OTHER CREDIT DOCUMENTS. Except as otherwise provided
in Section 12.04 hereof with respect to this Agreement, the Administrative Agent
may, with the prior consent of the Majority Lenders (but not otherwise), consent
to any modification, supplement or waiver under any of the Credit Documents,
PROVIDED that, without the prior consent of each Lender, the Administrative
Agent shall not (except as provided herein or in the Security Documents) release
any collateral or otherwise terminate any Lien under any Security Document
providing for collateral security, agree to additional obligations being secured
by such collateral security (unless the Lien for such additional obligations
shall be junior to the Lien in favor of the other obligations secured by such
Security Document, in which event the Administrative Agent may consent to such
junior Lien provided that it obtains the consent of the Majority Lenders
thereto), alter the relative priorities of the obligations entitled to the
benefits of the Liens created under the Security Documents or release any
guarantor under any Security Document from its guarantee obligations thereunder,
except that no such consent shall be required, and the Administrative Agent is
hereby authorized, to release any Lien covering Property (and to release any
such guarantor) that is the subject of either a disposition of Property
permitted hereunder (including, without limitation, dispositions of Receivables
and Related Assets pursuant to Permitted Receivables Financings) or a
disposition to which the Majority Lenders have consented.
11.10 COLLATERAL SUB-AGENTS. Each Lender by its execution and delivery of
this Agreement agrees, as contemplated by Section 4.03 of the Pledge and
Security Agreement, that, in
Credit Agreement
----------------
175
- 169 -
the event it shall hold any Permitted Investments referred to therein, such
Permitted Investments shall be held in the name and under the control of such
Lender, and such Lender shall hold such Permitted Investments as a collateral
sub-agent for the Administrative Agent thereunder. The Obligors by their
execution and delivery of this Agreement hereby consent to the foregoing.
Section 12. MISCELLANEOUS.
12.01 WAIVER. No failure on the part of the Administrative Agent or any
Lender to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power or privilege under this Agreement or any Note shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege under this Agreement or any Note preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
12.02 NOTICES. All notices, requests and other communications provided for
herein and under the Security Documents (including, without limitation, any
modifications of, or waivers, requests or consents under, this Agreement) shall
be given or made in writing (including, without limitation, by telecopy)
delivered to the intended recipient:
(a) in the case of each of the Obligors, at the "Address for Notices"
specified below the name of the Parent on the signature pages hereof;
(b) in the case of the Administrative Agent, at the "Address for
Notices" specified below the name of the Administrative Agent on the
signature pages hereof; and
(c) in the case of any Lender, at its address (or telecopy number) set
forth in its Administrative Questionnaire;
Credit Agreement
----------------
176
- 170 -
or, as to any party, at such other address as shall be designated by such party
in a notice to each other party. Except as otherwise provided in this Agreement,
all such communications shall be deemed to have been duly given when transmitted
by telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
12.03 EXPENSES, ETC. The Parent and the Borrowers agree jointly and
severally to pay or reimburse each of the Lenders and the Administrative Agent
for: (a) all reasonable out-of-pocket costs and expenses of the Administrative
Agent (including, without limitation, the reasonable fees and expenses of
Milbank, Tweed, Xxxxxx & XxXxxx, special New York counsel to NatWest) in
connection with (i) the negotiation, preparation, execution and delivery of this
Agreement and the other Credit Documents and the extension of credit hereunder
and (ii) the negotiation or preparation of any modification, supplement or
waiver of any of the terms of this Agreement or any of the other Credit
Documents (whether or not consummated); (b) all reasonable out-of-pocket costs
and expenses of the Lenders and the Administrative Agent (including, without
limitation, the reasonable fees and expenses of legal counsel) in connection
with (i) any Default and any enforcement or collection proceedings resulting
therefrom, including, without limitation, all manner of participation in or
other involvement with (x) bankruptcy, insolvency, receivership, foreclosure,
winding up or liquidation proceedings, (y) judicial or regulatory proceedings
and (z) workout, restructuring or other negotiations or proceedings (whether or
not the workout, restructuring or transaction contemplated thereby is
consummated) and (ii) the enforcement of this Section 12.03; (c) all transfer,
stamp, documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement or any of the
other Credit Documents or any other document referred to herein or therein and
all costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated by
Credit Agreement
----------------
177
- 171 -
any Security Document or any other document referred to therein; and (d) all
costs, expenses and other charges in respect of title insurance procured with
respect to the Liens created pursuant to the Mortgages.
The Parent and the Borrowers hereby agree jointly and severally to
indemnify the Administrative Agent and each Lender and their respective
directors, officers, employees, attorneys and agents from, and hold each of them
harmless against, any and all losses, liabilities, claims, damages or expenses
incurred by any of them (including, without limitation, any and all losses,
liabilities, claims, damages or expenses incurred by the Administrative Agent to
any Lender, whether or not the Administrative Agent or any Lender is a party
thereto) arising out of or by reason of any investigation or litigation or other
proceedings (including any threatened investigation or litigation or other
proceedings) relating to the extensions of credit hereunder or any actual or
proposed use by the Obligors of any of its Subsidiaries of the proceeds of any
of the extensions of credit hereunder, including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation or litigation or other proceedings (but excluding any such
losses, liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified or such
Person's directors, officers, employees, attorneys or agents). Without limiting
the generality of the foregoing, the Parent and the Borrowers jointly and
severally will indemnify the Administrative Agent and each Lender from, and hold
the Administrative Agent and each Lender harmless against, any losses,
liabilities, claims, damages or expenses described in the preceding sentence
(including any Lien filed against any Property covered by the Mortgages or any
part of the Mortgage Estate thereunder in favor of any governmental entity, but
excluding, as provided in the preceding sentence, any loss, liability, claim,
damage or expense incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified) arising under any Environmental Law
as a result of the past, present or future operations of the Parent or any of
its Subsidiaries (or any predecessor in interest
Credit Agreement
----------------
178
- 172 -
to the Parent or any of its Subsidiaries), or the past, present or future
condition of any site or facility owned, operated or leased at any time by the
Parent or any of its Subsidiaries (or any such predecessor in interest), or any
Release or threatened Release of any Hazardous Materials at or from any such
site or facility, excluding any such Release or threatened Release that shall
occur during any period when the Administrative Agent or any Lender shall be in
possession of any such site or facility following the exercise by the
Administrative Agent or any Lender of any of its rights and remedies hereunder
or under any of the Security Documents, but including any such Release or
threatened Release occurring during such period that is a continuation of
conditions previously in existence, or of practices employed by the Parent and
its Subsidiaries, at such site or facility.
12.04 AMENDMENTS, ETC. Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be modified or supplemented only
after written notice to all Lenders and by an instrument in writing signed by
the Parent, the Borrowers and the Majority Lenders, or by the Parent, the
Borrowers and the Administrative Agent acting with the consent of the Majority
Lenders, and any provision of this Agreement may be waived after written notice
to all Lenders by the Majority Lenders or by the Administrative Agent acting
with the consent of the Majority Lenders; PROVIDED that:
(a) no modification, supplement or waiver shall, unless by an
instrument signed by all of the Lenders or by the Administrative Agent
acting with the consent of all of the Lenders: (i) increase, or extend the
term of any of the Commitments, or extend the time or waive any requirement
for the scheduled reduction or termination of any of the Commitments, (ii)
extend the date fixed for the scheduled payment of principal of or interest
on any Loan, the Reimbursement Obligations or any fee hereunder, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at
which interest is payable thereon or any fee is payable hereunder, (v)
alter the rights or obligations of the Borrowers to prepay Loans, (vi)
alter the manner in
Credit Agreement
----------------
179
- 173 -
which payments or prepayments of principal, interest or other amounts
hereunder shall be applied as between the Lenders or Types or Facilities of
Loans, (vii) alter the terms of this Section 12.04, (viii) modify the
definition of the term "Majority Lenders", "Majority Revolving Credit
Lenders" or "Majority Term Loan Lenders" or modify in any other manner the
number or percentage of the Lenders required to make any determinations or
waive any rights hereunder or to modify any provision hereof, (ix) release
any Guarantor from any of its guarantee obligations under Section 6 hereof,
or (x) waive any of the conditions precedent set forth in Section 7.02
hereof;
(b) any modification, supplement or waiver of Section 2.01(c) hereof
shall require the consent of the Swingline Lender;
(c) any modification or supplement of Section 11 hereof, or of any of
the rights or duties of the Administrative Agent hereunder, shall require
the consent of the Administrative Agent; and
(d) any modification or supplement of Section 6 hereof shall require
the consent of each Guarantor.
12.05 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
12.06 ASSIGNMENTS AND PARTICIPATIONS.
(a) No Obligor may assign any of its rights or obligations hereunder or
under the Notes without the prior consent of all of the Lenders and the
Administrative Agent.
(b) Each Lender may assign any of its Loans, its Notes, its Commitments,
and, if such Lender is a Revolving Credit Lender, its Letter of Credit Interest
(but only with the consent of the Administrative Agent, the Parent and (in the
case of a
Credit Agreement
----------------
180
- 174 -
Revolving Credit Commitment or a Letter of Credit Interest) the Issuing Banks,
such consents not to be unreasonably withheld); PROVIDED that
(i) no such consent by the Parent, the Administrative Agent or the
Issuing Banks shall be required in the case of any assignment to another
Lender;
(ii) except to the extent the Parent and the Administrative Agent
shall otherwise consent, any such partial assignment (other than to another
Lender) shall be in an amount at least equal to $5,000,000;
(iii) each such assignment by a Lender of its Loans, Note, Commitment
or Letter of Credit Interest under the Revolving Credit Facility shall be
made in such manner so that the same portion of its Loans, Note, Commitment
and Letter of Credit Interest under the Revolving Credit Facility are
assigned to the respective assignee; and
(iv) each such assignment by a Lender of its Loans or Commitment under
the Term Loan Facility shall be made in such manner so that the same
portion of its Term Loans and Term Loan Commitment are assigned to the
respective assignee.
Upon execution and delivery by the assignee to the Parent, the Administrative
Agent and the Issuing Banks of an instrument in writing pursuant to which such
assignee agrees to become a "Lender" hereunder (if not already a Lender) having
the Commitment(s), Loans, and, if applicable, Letter of Credit Interest
specified in such instrument, and upon consent thereto by the Parent, the
Administrative Agent and the Issuing Banks to the extent required above, the
assignee shall have, to the extent of such assignment (unless provided in such
assignment with the consent of the Parent, the Administrative Agent and the
Issuing Banks), the obligations, rights and benefits of a Lender hereunder
holding the Commitment(s), Loans and, if applicable, Letter of Credit Interest
(or portions thereof) assigned to it
Credit Agreement
----------------
181
- 175 -
(in addition to the Commitment(s), Loans and Letter of Credit Interest, if any,
theretofore held by such assignee) and the assigning Lender shall, to the extent
of such assignment, be released from the Commitment(s) (or portion(s) thereof)
so assigned. Upon each such assignment (but excluding, in any event, the
assignments contemplated in Section 2.01(c) hereof) the assigning Lender shall
pay the Administrative Agent an assignment fee of $3,500.
(c) A Lender may sell or agree to sell to one or more other Persons (each a
"PARTICIPANT") a participation in all or any part of any Loans or Letter of
Credit Interest held by it, or in its Commitments, PROVIDED that such
Participant shall not have any rights or obligations under this Agreement or any
Note or any other Credit Document (the Participant's rights against such Lender
in respect of such participation to be those set forth in the agreements
executed by such Lender in favor of the Participant). All amounts payable by the
Borrowers to any Lender under Section 5 hereof in respect of Loans, Letter of
Credit Interest held by it, and its Commitments, shall be determined as if such
Lender had not sold or agreed to sell any participations in such Loans, Letter
of Credit Interest and Commitments, and as if such Lender were funding each of
such Loan, Letter of Credit Interest and Commitments in the same way that it is
funding the portion of such Loan, Letter of Credit Interest and Commitments in
which no participations have been sold. In no event shall a Lender that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Credit Document except that such Lender may
agree with the Participant that it will not, without the consent of the
Participant, agree to (i) increase or extend the term of such Lender's related
Commitment, (ii) extend the scheduled date fixed for the payment of principal of
or interest on the related Loan or Loans, Reimbursement Obligations or any
portion of any fee hereunder payable to the Participant, (iii) reduce the amount
of any such payment of principal, (iv) reduce the rate at which interest is
payable thereon, or any fee hereunder payable to the Participant, to a level
below the rate at which the Participant is entitled to receive such interest or
fee or (v) consent to any
Credit Agreement
----------------
182
- 176 -
modification, supplement or waiver hereof or of any of the other Credit
Documents to the extent that the same, under Section 11.09 or 12.04 hereof,
requires the consent of each Lender.
(d) In addition to the assignments and participations permitted under the
foregoing provisions of this Section 12.06, any Lender may (without notice to
the Parent, the Administrative Agent, the Issuing Banks or any other Lender and
without payment of any fee) assign and pledge all or any portion of its Loans
and its Notes to any Federal Reserve Bank as collateral security pursuant to
Regulation A and any Operating Circular issued by such Federal Reserve Bank, and
such Loans and Notes shall be fully transferrable as provided therein. No such
assignment shall release the assigning Lender from its obligations hereunder.
(e) A Lender may furnish any information concerning the Parent or any of
its Subsidiaries in the possession of such Lender from time to time to assignees
and participants (including prospective assignees and participants), subject,
however, to the provisions of Section 12.12(b) hereof.
(f) Anything in this Section 12.06 to the contrary notwithstanding, no
Lender may assign or participate any interest in any Loan or Reimbursement
Obligation held by it hereunder to the Parent or any of its Affiliates or
Subsidiaries without the prior consent of each Lender.
12.07 SURVIVAL. The obligations of the Obligors under Sections 5.01, 5.05,
5.06, 5.07 and 12.03 hereof, the obligations of each Guarantor under Section
6.03 hereof, and the obligations of the Lenders under Section 11.05 hereof,
shall survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments and, in the case of any Lender that may assign
any interest in its Commitments, Loans or Letter of Credit Interest hereunder,
shall survive the making of such assignment, notwithstanding that such assigning
Lender may cease to be a "Lender" hereunder. In addition, each representation
and warranty made, or deemed to be made by a notice of any extension
Credit Agreement
----------------
183
- 177 -
of credit (whether by means of a Loan or a Letter of Credit), herein or
pursuant hereto shall survive the making of such representation and warranty,
and no Lender shall be deemed to have waived, by reason of making any extension
of credit hereunder (whether by means of a Loan or a Letter of Credit), any
Default that may arise by reason of such representation or warranty proving to
have been false or misleading, notwithstanding that such Lender or the
Administrative Agent may have had notice or knowledge or reason to believe that
such representation or warranty was false or misleading at the time such
extension of credit was made.
12.08 CAPTIONS. The table of contents and captions and section headings
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.
12.09 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
12.10 GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement and the
Notes shall be governed by, and construed in accordance with, the law of the
State of New York. Each Obligor hereby submits to the nonexclusive jurisdiction
of the United States District Court for the Southern District of New York and of
the Supreme Court of the State of New York sitting in New York County (including
its Appellate Division), and of any other appellate court in the State of New
York, for the purposes of all legal proceedings arising out of or relating to
this Agreement or the transactions contemplated hereby. Each Obligor hereby
irrevocably waives, to the fullest extent permitted by applicable law, any
objection that it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
Credit Agreement
----------------
184
- 178 -
12.11 WAIVER OF JURY TRIAL. EACH OF THE OBLIGORS, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
12.12 TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY.
(a) Each Obligor acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided to the Parent
or one or more of its Subsidiaries (in connection with this Agreement or
otherwise) by any Lender or by one or more subsidiaries or affiliates of such
Lender and each of the Obligors hereby authorizes each Lender to share any
information delivered to such Lender by such Obligor and its Subsidiaries
pursuant to this Agreement, or in connection with the decision of such Lender to
enter into this Agreement, with any such subsidiary or affiliate, it being
understood that any such subsidiary or affiliate receiving such information
shall be bound by the provisions of paragraph (b) below as if it were a Lender
hereunder. Such authorization shall survive the repayment of the Loans and
Reimbursement Obligations and the termination of the Commitments.
(b) Each Lender and the Administrative Agent agrees (on behalf of itself
and each of its affiliates, directors, officers, employees and representatives)
to use reasonable precautions to keep confidential, in accordance with their
customary procedures for handling confidential information of the same nature
and in accordance with safe and sound banking practices, any non-public
information supplied to it by any of the Obligors pursuant to this Agreement
that is identified by such Person as being confidential at the time the same is
delivered to the Lenders or the Administrative Agent, PROVIDED that nothing
herein shall limit the disclosure of any such information (i) after such
information shall have become public (other than through a violation of this
Section 12.12), (ii) to
Credit Agreement
----------------
185
- 179 -
the extent required by statute, rule, regulation or judicial process, (iii) to
counsel for any of the Lenders or the Administrative Agent, (iv) to bank
examiners (or any other regulatory authority having jurisdiction over any Lender
or the Administrative Agent), or to auditors or accountants, (v) to the
Administrative Agent or any other Lender, (vi) in connection with any litigation
to which any one or more of the Lenders or the Administrative Agent is a party,
or in connection with the enforcement of rights or remedies hereunder or under
any other Credit Document, (vii) to a subsidiary or affiliate of such Lender as
provided in paragraph (a) above or (viii) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the
respective Lender a Confidentiality Agreement substantially in the form of
Exhibit D hereto (or executes and delivers to such Lender an acknowledgement to
the effect that it is bound by the provisions of this Section 12.12(b), which
acknowledgement may be included as part of the respective assignment or
participation agreement pursuant to which such assignee or participant acquires
an interest in the Loans or Letter of Credit Interest hereunder); PROVIDED,
FURTHER, that in no event shall any Lender or the Administrative Agent be
obligated or required to return any materials furnished by any of the Obligors
or any of their respective Subsidiaries. The obligations of each Lender under
this Section 12.12 shall supersede and replace the obligations of such Lender
under the confidentiality letter in respect of this financing signed and
delivered by such Lender to the Company prior to the date hereof; in addition,
the obligations of any assignee that has executed a Confidentiality Agreement in
the form of Exhibit D hereto shall be superseded by this Section 12.12 upon the
date upon which such assignee becomes a Lender hereunder pursuant to Section
12.06(b) hereof.
Credit Agreement
----------------
186
- 180 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
THE PARENT
----------
COMMONWEALTH ALUMINUM CORPORATION
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
Address for Notices:
Commonwealth Aluminum Corporation
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: President
with a copy to:
Xxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxx, Esq.
Credit Agreement
----------------
187
- 181 -
HOLDINGS
--------
COMMONWEALTH INDUSTRIES, INC.
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
THE BORROWERS
-------------
COMMONWEALTH ALUMINUM LEWISPORT,
INC.
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
ALFLEX CORPORATION
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
BARMET ALUMINUM CORPORATION
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
Credit Agreement
----------------
188
- 182 -
SUBSIDIARY GUARANTOR
--------------------
COMMONWEALTH ALUMINUM SALES
CORPORATION
By /s/ Xxxxxx Xxxxx, Xx.
--------------------------------
Title: Executive Vice President
Credit Agreement
----------------
189
- 183 -
LENDERS
-------
Existing Lenders
----------------
NATIONAL WESTMINSTER BANK PLC
By /s/ Xxxxx Xxxxx
--------------------------------
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
By /s/ Xxxxxxxx X. Xxxxxx
--------------------------------
Title: Vice President
BANK OF MONTREAL
By /s/ Xxxxxx X. Xxxxxxx
--------------------------------
Title: Director
MELLON BANK, N.A.
By /s/ Xxxxxx X. Xxxxxx
--------------------------------
Title: Assistant Vice President
NBD BANK, N.A.
Credit Agreement
----------------
190
- 184 -
By /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Title: First Vice President
New Lenders
-----------
ABN AMRO BANK N.V.
By /s/ Xxxxxxx X. Xxxx
--------------------------------
Title: Group Vice President
By /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Title: Assistant Vice President
THE BANK OF NOVA SCOTIA
By /s/ F. C. H. Xxxxx
--------------------------------
Title: Senior Manager Loan
Operations
CAISSE NATIONALE DE CRIDIT AGRICOLE
By /s/ Xxxxx Xxxxx
--------------------------------
Title: F.V.P. Head of Croporate
Banking Chicago
Credit Agreement
----------------
191
- 185 -
THE FUJI BANK, LIMITED
CHICAGO BRANCH
By /s/ Xxxxx X. Xxxxxxxx
------------------------------
Title: Joint General Manager
THE BANK OF TOKYO-MITSUBISHI, LTD.,
NEW YORK BRANCH
By /s/ Xxxxxx Xxxxxxxxx
------------------------------
Title: Deputy General Manager
CREDITANSTALT BANKVEREIN
By /s/ Xxxxxxxxx X. XxxXxxxxx
------------------------------
Title: Senior Associate
By /s/ Xxxxxxx X. Xxxxxxxxxxx
------------------------------
Title: Vice President
THE INDUSTRIAL BANK
OF JAPAN, LIMITED
By /s/ Xxxxxx X. Xxxxxx, Xx.
------------------------------
Title: Senior Vice President
Credit Agreement
----------------
192
- 186 -
THE MITSUBISHI TRUST AND
BANKING CORPORATION
By /s/ Xxxxxxxx Xxxxx Xx Xxxx
-----------------------------
Title: Senior Vice President
NATIONAL CITY BANK OF KENTUCKY
By /s/ Xxx Xxxxxxx
-----------------------------
Title: Vice President
SOCIETE GENERALE
By /s/ Xxxxxx X. Xxxxxx
-----------------------------
Title: Vice President
THE YASUDA TRUST AND
BANKING CO., LTD.
By /s/ Xxxxxx Xxxxxx
-----------------------------
Title: Deputy General Manager
Credit Agreement
----------------
193
- 187 -
FIFTH THIRD BANK OF KENTUCKY, INC.
By /s/ Xxx Xxxx
----------------------------------
Title: Assistant Vice President
Credit Agreement
----------------
194
- 188 -
THE ADMINISTRATIVE AGENT
------------------------
NATIONAL WESTMINSTER BANK PLC,
as Administrative Agent
By /s/ Xxxxx Xxxxx
-----------------------------
Title: Vice President
Address for Notices:
National Westminster Bank Plc
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
Attention: Xxxxx Xxxxx
Credit Agreement
----------------
