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EXHIBIT 10.69
FINANCING AGREEMENT
Dated as of May 2, 2000
by and among
DECORA INDUSTRIES, INC.
DECORA, INCORPORATED,
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THE FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTY HERETO,
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ABLECO FINANCE LLC,
as Collateral Agent,
and
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Administrative Agent
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS; CERTAIN TERMS..................................................
SECTION 1.01. Definitions....................................................... 1
SECTION 1.02. Terms Generally................................................... 27
SECTION 1.03. Accounting and Other Terms........................................ 28
SECTION 1.04. Time References................................................... 28
ARTICLE II THE LOANS.................................................................. 28
SECTION 2.01. Commitments....................................................... 28
SECTION 2.02. Making the Loans.................................................. 29
SECTION 2.03. Notes; Repayment of Loans......................................... 33
SECTION 2.04. Interest.......................................................... 34
(a) Loans.................................................... 34
(b) Revolving Loans.......................................... 34
(c) Default Interest......................................... 34
(d) Interest Payment......................................... 34
(e) General.................................................. 34
SECTION 2.05. Reduction of Commitment; Prepayment of Loans...................... 34
(a) Reduction of Commitments................................. 34
(b) Optional Prepayment...................................... 35
(c) Mandatory Prepayment..................................... 35
(d) Application of Payments.................................. 37
(e) Interest and Fees........................................ 37
(f) Cumulative Prepayments................................... 37
SECTION 2.06. Fees.............................................................. 37
(a) Closing Fee.............................................. 37
(b) Commitment Fee........................................... 37
(c) Unused Line Fee.......................................... 37
(d) Loan Servicing Fee....................................... 38
(e) Anniversary Fee.......................................... 38
SECTION 2.07. Securitization.................................................... 38
ARTICLE III SUPPORT LETTER OF CREDIT.................................................. 39
SECTION 3.01. Letter of Credit Guaranty......................................... 39
SECTION 3.02. Participations.................................................... 40
SECTION 3.03. Support Letter of Credit.......................................... 42
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(a) Request for Issuance..................................... 42
(b) Letter of Credit Fees.................................... 42
ARTICLE IV FEES, PAYMENTS AND OTHER COMPENSATION...................................... 42
SECTION 4.01. Audit and Collateral Monitoring Fees.............................. 42
SECTION 4.02. Payments; Computations and Statements............................. 42
SECTION 4.03. Sharing of Payments, Etc.......................................... 43
SECTION 4.04. Apportionment of Payments......................................... 44
SECTION 4.05. Increased Costs and Reduced Return................................ 45
ARTICLE V CONDITIONS TO LOANS......................................................... 47
SECTION 5.01. Conditions Precedent to Effectiveness............................. 47
(a) Payment of Fees, Etc..................................... 47
(b) Representations and Warranties; No Event of
Default.................................................. 47
(c) Legality................................................. 47
(d) Delivery of Documents.................................... 47
(e) Material Adverse Change.................................. 50
(f) Proceedings; Receipt of Documents........................ 50
(g) Management Reference Checks.............................. 51
(h) Due Diligence............................................ 51
SECTION 5.02. Conditions Precedent to all Loans and the Support Letter
of Credit...................................................... 51
(a) Payment of Fees, Etc..................................... 51
(b) Representations and Warranties; No Event of
Default.................................................. 51
(c) Legality................................................. 52
(d) Notices; Borrowing Base Certificate...................... 52
(e) Delivery of Documents.................................... 52
(f) Proceedings; Receipt of Documents........................ 52
(g) Title Continuation; Term C Note.......................... 52
ARTICLE VI REPRESENTATIONS AND WARRANTIES............................................. 53
SECTION 6.01. Representations and Warranties.................................... 53
(a) Organization, Good Standing, Etc......................... 53
(b) Authorization, Etc....................................... 53
(c) Governmental Approvals................................... 53
(d) Enforceability of Loan Documents......................... 53
(e) Subsidiaries............................................. 53
(f) Litigation............................................... 54
(g) Financial Condition...................................... 54
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(h) Compliance with Law, Etc................................. 54
(i) ERISA.................................................... 54
(j) Taxes, Etc............................................... 55
(k) Regulation U............................................. 55
(l) Nature of Business....................................... 55
(m) Adverse Agreements, Etc.................................. 55
(n) Permits, Etc............................................. 56
(o) Properties............................................... 56
(p) Full Disclosure.......................................... 56
(q) Year 2000................................................ 56
(r) Operating Lease Obligations.............................. 57
(s) Environmental Matters.................................... 57
(t) Insurance................................................ 57
(u) Use of Proceeds.......................................... 57
(v) Solvency................................................. 58
(w) Location of Bank Accounts................................ 58
(x) Intellectual Property.................................... 58
(y) Material Contracts....................................... 58
(z) Holding Company and Investment Company Acts.............. 58
(aa) Employee and Labor Matters............................... 59
(bb) Customers and Suppliers.................................. 59
(cc) No Bankruptcy Filing..................................... 59
(dd) Separate Existence....................................... 59
(ee) Location of Inventory; Place of Business;
Chief Executive Office................................... 60
(ff) Tradenames............................................... 60
(gg) Security Interests....................................... 60
(hh) Schedules................................................ 60
(ii) Representations and Warranties in Documents;
No Default............................................... 60
(jj) Indenture................................................ 61
ARTICLE VII COVENANTS OF THE BORROWER................................................. 61
SECTION 7.01. Affirmative Covenants............................................. 61
(a) Reporting Requirements................................... 61
(b) Additional Guaranties and Collateral Security............ 65
(c) Compliance with Laws, Etc................................ 65
(d) Preservation of Existence, Etc........................... 66
(e) Keeping of Records and Books of Account.................. 66
(f) Inspection Rights........................................ 66
(g) Maintenance of Properties, Etc........................... 66
(h) Maintenance of Insurance................................. 66
(i) Obtaining of Permits, Etc................................ 67
(j) Environmental............................................ 67
(k) Further Assurances....................................... 68
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(l) Change in Collateral; Collateral Records................. 68
(m) Landlord Waivers; Collateral Access Agreements........... 68
(n) Subordination............................................ 68
(o) After Acquired Real Property............................. 69
(p) Fiscal Year.............................................. 69
(q) Borrowing Base........................................... 69
(r) XXX Indenture............................................ 69
(s) Environmental Remediation................................ 70
(t) CIGNA Indebtedness....................................... 70
SECTION 7.02. Negative Covenants................................................ 70
(a) Liens, Etc............................................... 70
(b) Indebtedness............................................. 70
(c) Fundamental Changes...................................... 70
(d) Change in Nature of Business............................. 71
(e) Loans, Advances, Investments, Etc........................ 71
(f) Lease Obligations........................................ 72
(g) Capital Expenditures..................................... 72
(h) Restricted Payments...................................... 72
(i) Federal Reserve Regulations.............................. 73
(j) Transactions with Affiliates............................. 73
(k) Limitations on Dividends and Other Payment
Restrictions Affecting Subsidiaries...................... 73
(l) Limitation on Issuance of Capital Stock.................. 74
(m) Modifications of Indebtedness, Organizational
Documents and Certain Other Agreements; Etc.............. 74
(n) Investment Company Act of 1940........................... 75
(o) Compromise of Accounts Receivable........................ 75
(p) Environmental............................................ 75
(q) Certain Agreements....................................... 75
SECTION 7.03. Financial Covenants............................................... 75
(a) Leverage Ratio........................................... 75
(c) Fixed Charge Coverage Ratio.............................. 76
(d) Consolidated EBITDA...................................... 76
ARTICLE VIII MANAGEMENT, COLLECTION AND STATUS OF ACCOUNTS RECEIVABLE AND
OTHER COLLATERAL...................................................... 77
SECTION 8.01. Collection of Accounts Receivable; Management of
Collateral..................................................... 77
SECTION 8.02. Accounts Receivable Documentation................................. 79
SECTION 8.03. Status of Accounts Receivable and Other Collateral................ 79
SECTION 8.04. Collateral Custodian.............................................. 80
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ARTICLE IX EVENTS OF DEFAULT.......................................................... 81
SECTION 9.01. Events of Default................................................. 81
ARTICLE X AGENT ...................................................................... 84
SECTION 10.01. Appointment...................................................... 84
SECTION 10.02. Nature of Duties................................................. 84
SECTION 10.03. Rights, Exculpation, Etc......................................... 85
SECTION 10.04. Reliance......................................................... 86
SECTION 10.05. Indemnification.................................................. 86
SECTION 10.06. Agents Individually.............................................. 86
SECTION 10.07. Successor Agent.................................................. 86
SECTION 10.08. Collateral Matters............................................... 87
ARTICLE XI GUARANTY................................................................... 89
SECTION 11.01. Guaranty; Limitation of Liability................................ 89
SECTION 11.02. Guaranty Absolute................................................ 89
SECTION 11.03. Waiver........................................................... 90
SECTION 11.04. Continuing Guaranty; Assignments................................. 90
SECTION 11.05. Subrogation...................................................... 91
ARTICLE XII MISCELLANEOUS............................................................. 91
SECTION 12.01. Notices, Etc..................................................... 91
SECTION 12.02. Amendments, Etc.................................................. 93
SECTION 12.03. No Waiver; Remedies, Etc......................................... 93
SECTION 12.04. Expenses; Taxes; Attorneys' Fees................................. 94
SECTION 12.05. Right of Set-off................................................. 95
SECTION 12.06. Severability..................................................... 95
SECTION 12.07. Assignments and Participations................................... 95
SECTION 12.08. Counterparts..................................................... 98
SECTION 12.09. GOVERNING LAW.................................................... 98
SECTION 12.10. CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE............ 98
SECTION 12.11. WAIVER OF JURY TRIAL, ETC........................................ 99
SECTION 12.12. Consent by the Agents and Lenders................................ 99
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SECTION 12.13. No Party Deemed Drafter.......................................... 99
SECTION 12.14. Reinstatement; Certain Payments.................................. 99
SECTION 12.15. Indemnification.................................................. 100
SECTION 12.16. Records.......................................................... 101
SECTION 11.17. Binding Effect................................................... 101
SECTION 12.18. Confidentiality.................................................. 101
SCHEDULE AND EXHIBITS
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Schedule 1.01(A) Lenders and Lenders' Commitments
Schedule 6.01(e) Subsidiaries
Schedule 6.01(f) Litigation
Schedule 6.01(i) ERISA
Schedule 6.01(o) Real Property
Schedule 6.01(r) Operating Leases
Schedule 6.01(s) Environmental Matters
Schedule 6.01(t) Insurance
Schedule 6.01(w) Bank Accounts
Schedule 6.01(x) Intellectual Property
Schedule 6.01(y) Material Contracts
Schedule 6.01(ee) Inventory Locations; Place of Business; Chief Executive Office
Schedule 6.01(ff) Tradenames
Schedule 7.01(l) Collateral Locations
Schedule 7.02(a) Existing Liens
Schedule 7.02(b) Existing Indebtedness
Schedule 7.02(e) Existing Investments
Schedule 7.02(k) Limitations on Dividends and Other Payment Restrictions
Exhibit A-1 Form of Term A Note
Exhibit A-2 Form of Term B Note
Exhibit A-3 Form of Term C Note
Exhibit B Form of Revolving Credit Note
Exhibit C Form of Guaranty
Exhibit D Form of Security Agreement (Borrower)
Exhibit E Form of Security Agreement (Guarantor)
Exhibit F Form of Pledge Agreement
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FINANCING AGREEMENT
Financing Agreement, dated as of May 2, 2000, by and among Decora
Industries, Inc., a Delaware corporation (the "Parent"), Decora, Incorporated, a
Delaware corporation (the "Borrower"), the financial institutions from time to
time party hereto (individually a "Lender" and collectively, the "Lenders"),
Ableco Finance LLC, a Delaware limited liability company ("Ableco"), as
collateral agent for the Lenders (in such capacity, the "Collateral Agent"), and
The CIT Group/Business Credit, Inc. ("CIT"), as administrative agent for the
Lenders (in such capacity, the "Administrative Agent" and together with the
Collateral Agent, each an "Agent" and collectively the "Agents").
RECITALS
The Parent and the Borrower have asked the Lenders to extend credit
to the Borrower consisting of (a) term loans in the aggregate principal amount
of up to $13,000,000 and (b) a revolving credit facility in an aggregate
principal amount not to exceed $14,000,000 at any time outstanding, which will
include a subfacility for the issuance of the Support Letter of Credit (as
hereinafter defined). The proceeds of the term loans and the loans made under
the revolving credit facility shall be used to refinance the indebtedness
outstanding under the Borrower's existing credit facility (the "Existing Credit
Facility") with Fleet National Bank (the "Existing Lender"), to provide funds
for interest payments under the Senior Secured Notes (as hereinafter defined)
and for general working capital purposes of the Borrower. The Support Letter of
Credit will be used to support an existing letter of credit issued by the
Existing Lender on behalf of the Borrower in connection with the XXX Xxxxx (as
hereinafter defined). The Lenders are severally, and not jointly, willing to
extend such credit to the Borrower subject to the terms and conditions
hereinafter set forth.
In consideration of the premises and the covenants and agreements
contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CERTAIN TERMS
SECTION 1.01. Definitions. As used in this Agreement, the following
terms shall have the respective meanings indicated below, such meanings to be
applicable equally to both the singular and plural forms of such terms:
"Ableco" has the meaning specified therefor in the preamble hereto.
"Account Debtor" means each debtor, customer or obligor in any way
obligated on or in connection with any Account Receivable.
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"Account Receivable" means any and all rights of the Borrower to
payment for goods sold and services rendered, including accounts, general
intangibles and any and all such rights evidenced by chattel paper, instruments
or documents, whether due or to become due and whether or not earned by
performance, and whether now or hereafter acquired or arising in the future and
any proceeds arising therefrom or relating thereto.
"Action" has the meaning specified therefor in Section 12.12.
"Adjusted Letter of Credit Obligations" means, at any time and
without duplication, the sum of (i) one-half of the sum of (A) the Reimbursement
Obligations at such time, plus (B) the aggregate maximum amount available for
drawing under the Support Letter of Credit at such time and (ii) all other
amounts for which the Administrative Agent may be liable to L/C Issuer pursuant
to any Letter of Credit Guaranty.
"Administrative Agent's Account" means an account at a bank
designated by the Administrative Agent from time to time as the account into
which the Borrower shall make all payments to the Administrative Agent for the
benefit of the Agents and the Lenders under this Agreement and the other Loan
Documents.
"Affiliate" means, as to any Person, any other Person that directly
or indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, either to (i)
vote 10% or more of the Capital Stock having ordinary voting power for the
election of directors of such Person or (ii) direct or cause the direction of
the management and policies of such Person whether by contract or otherwise.
Notwithstanding anything herein to the contrary, in no event shall any Agent or
any Lender be considered an "Affiliate" of any Loan Party.
"Agents" has the meaning specified therefor in the preamble hereto.
"Agreement" means this Financing Agreement, including all
amendments, modifications and supplements and any exhibits or schedules to any
of the foregoing, and shall refer to the Agreement as the same may be in effect
at the time such reference becomes operative.
"Anniversary Fee" has the meaning specified therefor in Section
2.06(e).
"Assignment and Acceptance" means an assignment and acceptance
entered into by an assigning Lender and an assignee, and accepted by the
Collateral Agent, in accordance with Section 12.07 hereof and substantially in
the form of Exhibit L hereto.
"Authorized Officer" means Xxxxxx Xxxxxxx, Xxxxxx XxxXxxxxx, Xxxxxx
Xxxxxx or such other officer of the Parent or the Borrower from time to time
designated in writing by the Parent or the Borrower.
"Availability" means, at any time, the difference between (i) the
lesser of (A) the Borrowing Base and (B) the Total Revolving Credit Commitment
and (ii) the sum of (A) the
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aggregate outstanding principal amount of all Revolving Loans and (B) all
Adjusted Letter of Credit Obligations.
"Bank" means The Chase Manhattan Bank, its successors or any other
bank designated by the Administrative Agent to the Borrower from time to time.
"Board" means the Board of Governors of the Federal Reserve System
of the United States.
"Book Value" means, as to any Inventory, the lower of (i) cost (as
reflected in the general ledger of the Borrower before customary (but not
extraordinary) reserves established by the Borrower in good faith and in
accordance with GAAP) and (ii) market value, in each case determined in
accordance with GAAP calculated on a first in first out basis.
"Borrower" has the meaning specified therefor in the preamble
hereto.
"Borrowing Base" means, at any time, the lesser of (i) the
difference between (A) the sum of (x) up to 85% of the value of the Borrower's
Net Amount of Eligible Accounts Receivable at such time plus (y) the lesser of
(1) up to 50% of the Book Value of the Borrower's Eligible Inventory at such
time and (2) up to 80% of the appraised orderly liquidation value of the
Borrower's Eligible Inventory at such time as determined by an independent third
party appraiser acceptable to the Agents and (B) the sum of (x) a reserve in an
amount equal to the outstanding principal amount of the WCLDC Loan plus (y) such
additional reserves as the Administrative Agent may deem appropriate in the
exercise of its reasonable business judgment based upon the lending practices of
the Administrative Agent, including, without limitation, such additional
reserves as the Administrative Agent deems appropriate in the event that the XXX
Indenture Documents are not terminated on or before July 6, 2000, and (ii) the
Indenture Borrowing Base.
"Borrowing Base Certificate" means a certificate signed by the chief
financial officer of the Borrower and setting forth the calculation of the
Borrowing Base (including the Indenture Borrowing Base) in compliance with
Section 7.01(a)(vi), substantially in the form of Exhibit I.
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required to
close.
"Capital Expenditures" means, with respect to any Person for any
period, the sum of (i) the aggregate of all expenditures by such Person and its
Subsidiaries during such period that in accordance with GAAP are or should be
included in "property, plant and equipment" or similar fixed asset account on
its balance sheet, whether such expenditures are paid in cash or financed and
including all Capitalized Lease Obligations paid or payable during such period,
and (ii) to the extent not covered by clause (i) above, the aggregate of all
expenditures by such Person and its Subsidiaries to acquire by purchase or
otherwise the business or fixed assets of, or the Capital Stock of, any other
Person.
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"Capital Guideline" means any law, rule, regulation, policy,
guideline or directive (whether or not having the force of law and whether or
not the failure to comply therewith would be unlawful) (i) regarding capital
adequacy, capital ratios, capital requirements, the calculation of a bank's
capital or similar matters, or (ii) affecting the amount of capital required to
be obtained or maintained by the Lenders, any Person controlling any Lender, or
the L/C Issuer or the manner in which the Lenders, any Person controlling any
Lender or the L/C Issuer allocate capital to any of their contingent liabilities
(including letters of credit), advances, acceptances, commitments, assets or
liabilities.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate stock, and (ii) with
respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.
"Capitalized Lease" means, with respect to any Person, any lease of
real or personal property by such Person as lessee which is required under GAAP
to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligations" means, with respect to any Person,
obligations of such Person and its Subsidiaries under Capitalized Leases, and,
for purposes hereof, the amount of any such obligation shall be the capitalized
amount thereof determined in accordance with GAAP.
"Cash and Cash Equivalents" means all cash and any presently
existing or hereafter arising deposit account balances, certificates of deposit
or other financial instruments properly classified as cash equivalents under
GAAP.
"Change of Control" means each occurrence of any of the following:
(a) the acquisition, directly or indirectly, by any person or group
(within the meaning of Section 13(d)(3) of the Exchange Act) of beneficial
ownership of more than 33% of the aggregate outstanding voting power of the
Capital Stock of the Parent;
(b) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of the Parent
(together with any new directors whose election by such Board of Directors or
whose nomination for election by the shareholders of the Parent was approved by
a vote of at least a majority of the directors of the Parent then still in
office who were either directors at the beginning of such period, or whose
election or nomination for election was previously approved) cease for any
reason to constitute a majority of the Board of Directors of the Parent;
(c) the Parent shall cease to have beneficial ownership (as defined
in Rule 13d-3 under the Exchange Act) of 100% of the aggregate voting power of
the Capital Stock of the Borrower and each Guarantor (other than the Parent),
free and clear of all Liens (other than any security interest in favor of the
Trustee);
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(d) (i) the Parent consolidates with or merges into another entity
or conveys, transfers or leases all or substantially all of its property and
assets to any Person, or (ii) the Borrower consolidates with or merges into
another entity or conveys, transfers or leases all or substantially all of its
property and assets to another Person, or (iii) any entity consolidates with or
merges into any Loan Party in a transaction pursuant to which the outstanding
voting Capital Stock of such Loan Party is reclassified or changed into or
exchanged for cash, securities or other property, other than any such
transaction described (A) in this clause (iii) in which either (x) in the case
of any such transaction involving the Parent, no person or group (within the
meaning of Section 13(d)(3) of the Exchange Act) has, directly or indirectly,
acquired beneficial ownership of more than 33% of the aggregate outstanding
voting Capital Stock of the Parent or (y) in the case of any such transaction
involving a Loan Party other than the Parent, the Parent has beneficial
ownership of 100% of the aggregate voting power of all Capital Stock of the
resulting, surviving or transferee entity;
(e) Xxxxxx Xxxxxxx shall cease to be involved in the day to day
operations and management of the business of the Parent and the Borrower and, in
the case of the death or permanent incapacity of Xxxxxx Xxxxxxx, a successor,
reasonably acceptable to the Collateral Agent, is not appointed, on terms
reasonably acceptable to the Collateral Agent, within 90 days of such cessation
of involvement; or
(f) a "Change of Control", as such term is defined under the
Indenture.
"CIT" has the meaning specified therefor in the preamble hereto.
"Closing Fee" has the meaning specified therefor in Section 2.06(a).
"Collateral" means all of the property and assets and all interests
therein and proceeds thereof now owned or hereafter acquired by any Person upon
which a Lien is granted or purported to be granted by such Person as security
for all or any part of the Obligations.
"Collateral Agent" has the meaning specified therefor in the
preamble hereto.
"Collateral Agent Advances" has the meaning specified therefor in
Section 10.08(a).
"Collection Account" and "Collection Accounts" have the meanings
specified therefor in Section 8.01.
"Commitment Fee" has the meaning specified therefor in Section
2.06(b).
"Commitments" means with respect to each Lender, such Lender's
Revolving Credit Commitment, Term Loan A Commitment, Term Loan B Commitment and
Term Loan C Commitment.
"Consolidated Current Assets" means, with respect to any Person at
any date, all assets other than Cash and Cash Equivalents that, as of the date
of determination thereof and in
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accordance with GAAP, should be classified as current assets on a consolidated
balance sheet of such Person and its Subsidiaries at such date.
"Consolidated Current Liabilities" means, with respect to any Person
at any date, all liabilities that, as of the date of determination thereof and
in accordance with GAAP, should be classified as current liabilities on a
consolidated balance sheet of such Person and its Subsidiaries at such date
including, without limitation, all Indebtedness (including, without limitation,
the Obligations) payable on demand or within one year after such date (whether
by final maturity, required prepayment or otherwise) without any option on the
part of the obligor to extend or renew beyond such year.
"Consolidated EBITDA" means, with respect to any Person for any
period, the Consolidated Net Income of such Person and its Subsidiaries for such
period, plus (i) without duplication, the sum of the following amounts of such
Person and its Subsidiaries for such period and to the extent deducted in
determining Consolidated Net Income of such Person for such period: (A)
Consolidated Net Interest Expense, (B) income tax expense, (C) depreciation
expense, (D) amortization expense, and (E) (i) extraordinary or unusual losses
and other losses from sales of assets other than Inventory sold in the ordinary
course of business less (ii) extraordinary or unusual gains and other gains from
sales of assets other than Inventory sold in the ordinary course of business.
"Consolidated Funded Indebtedness" means, with respect to any Person
at any date, all Indebtedness of such Person, determined on a consolidated basis
in accordance with GAAP, which by its terms matures more than one year after the
date of calculation, and any such Indebtedness maturing within one year from
such date which is renewable or extendable at the option of such Person to a
date more than one year from such date including, in any event, with respect to
the Borrower and its Subsidiaries, the Revolving Loans.
"Consolidated Net Income" means, with respect to any Person for any
period, the net income (loss) of such Person and its Subsidiaries for such
period, determined on a consolidated basis and in accordance with GAAP, but
excluding from the determination of Consolidated Net Income (without
duplication) (a) restructuring charges, (b) effects of discontinued operations
and (c) interest income.
"Consolidated Net Interest Expense" means, with respect to any
Person for any period, gross interest expense of such Person and its
Subsidiaries for such period determined in conformity with GAAP (including,
without limitation, interest expense paid to Affiliates of such Person), less
(i) the sum of (A) interest income for such period and (B) gains for such period
on Hedging Agreements (to the extent not included in interest income above and
to the extent not deducted in the calculation of such gross interest expense),
plus (ii) the sum of (A) losses for such period on Hedging Agreements (to the
extent not included in such gross interest expense) and (B) the upfront costs or
fees for such period associated with Hedging Agreements (to the extent not
included in gross interest expense), each determined on a consolidated basis and
in accordance with GAAP for such Person and its Subsidiaries.
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"Consolidated Subsidiary" means, with respect to any Person, those
Subsidiaries of such Person (including, in the case of the Parent, German
Holdings and its Subsidiaries) whose accounts are or should in accordance with
GAAP be consolidated with those of such Person.
"Consolidated Tangible Net Worth" means, with respect to any Person
at any time, (i) the sum of the following accounts (or their equivalents) set
forth on a consolidated balance sheet of such Person and its Subsidiaries
prepared in accordance with GAAP: the par or stated value of all outstanding
Capital Stock, capital surplus and retained earnings (or less accumulated
deficits), less (ii) all intangibles included on the asset side of such balance
sheet, including, without limitation, goodwill (including any amounts, however
designated on such balance sheet, representing the excess of the purchase price
paid for assets or stock acquired over the value assigned thereto on the books
of such Person and its Subsidiaries), patents, trademarks, trade names,
copyrights and similar intangibles.
"Contingent Obligation" means, with respect to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, (i) the direct or indirect guaranty,
endorsement (other than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of a primary obligor, (ii) the obligation to make
take-or-pay or similar payments, if required, regardless of nonperformance by
any other party or parties to an agreement, (iii) any obligation of such Person,
whether or not contingent, (A) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (B) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (C) to
purchase property, assets, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (D) otherwise to assure or
hold harmless the holder of such primary obligation against loss in respect
thereof; provided, however, that the term "Contingent Obligation" shall not
include any products warranties extended in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation with respect to which
such Contingent Obligation is made (or, if less, the maximum amount of such
primary obligation for which such Person may be liable pursuant to the terms of
the instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability with respect thereto
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.
"Default" means an event which, with the giving of notice or the
lapse of time or both, would constitute an Event of Default.
"Disposition" means any transaction, or series of related
transactions, pursuant to which any Loan Party or any of its Subsidiaries sells,
assigns, transfers or otherwise disposes of any property or assets (whether now
owned or hereafter acquired) to any other Person, in each
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case whether or not the consideration therefor consists of cash, securities or
other assets owned by the acquiring Person, excluding any sales of Inventory in
the ordinary course of business on ordinary business terms or sales or other
dispositions of Permitted Investments.
"Dollar," "Dollars" and the symbol "$" each means lawful money of
the United States of America.
"Effective Date" means the date on which all of the conditions
precedent set forth in Article IV are satisfied or waived and the initial Loan
is made.
"Eligible Accounts Receivable" means the Accounts Receivable which
are, and at all times continue to be, acceptable to the Administrative Agent in
the exercise of its reasonable business judgment. In general, an Account
Receivable may, in the sole and absolute discretion of the Administrative Agent,
be deemed to be eligible if: (i) delivery of the merchandise or the rendition of
the services has been completed; (ii) with respect to such Account Receivable,
no return, rejection, repossession or dispute has occurred, the Account Debtor
has not asserted any setoff, defense or counterclaim, and there has not occurred
any extension of the time for payment without the consent of the Administrative
Agent, provided that, in the case of any dispute, setoff, defense or
counterclaim with respect to an Account Receivable, the portion of such Account
Receivable not subject to such dispute, setoff, defense or counterclaim will not
be ineligible solely by reason of this clause (ii); (iii) such Account
Receivable is lawfully owned by the Borrower free and clear of any Lien other
than in favor of the Collateral Agent for the benefit of the Lenders and
otherwise continues to be in full conformity with all representations and
warranties made by the Borrower to the Agents and the Lenders with respect
thereto in the Loan Documents; (iv) such Account Receivable is unconditionally
payable in Dollars within 90 days from the invoice date and is not evidenced by
a promissory note, chattel paper or any other instrument or other document; (v)
no more than 60 days have elapsed from the invoice due date and no more than 90
days have elapsed from the invoice date with respect to such Account Receivable;
(vi) such Account Receivable is not due from an Affiliate of the Borrower; (vii)
such Account Receivable does not constitute an obligation of the United States
or any other Governmental Authority (unless all steps required by the
Administrative Agent in connection therewith, including notice to the United
States Government under the Federal Assignment of Claims Act, have been duly
taken in a manner satisfactory to the Administrative Agent); (viii) the Account
Debtor (or the applicable office of the Account Debtor) with respect to such
Account Receivable is located (A) in the continental United States, unless such
Account Receivable is supported by a letter of credit or other similar
obligation satisfactory to the Administrative Agent or (B) in Canada or any
province thereof, provided that the aggregate value of the Eligible Accounts
Receivable permitted by this clause (viii)(B) shall not exceed $1,500,000 at any
time; (ix) the Account Debtor with respect to such Account Receivable is not
also a supplier to or creditor of the Borrower, unless such Account Debtor has
executed a no-offset letter satisfactory to the Administrative Agent; (x) not
more than 50% of the aggregate amount of all Accounts Receivable of the Account
Debtor with respect to such Account Receivable have remained unpaid 60 days past
the invoice due date or 90 days past the invoice date; (xi) the Account Debtor
with respect to such Account Receivable (A) has not filed a petition for
bankruptcy or any other relief under the Bankruptcy Code or any other law
relating to
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bankruptcy, insolvency, reorganization or relief of debtors, made an assignment
for the benefit of creditors, had filed against it any petition or other
application for relief under the Bankruptcy Code or any such other law, (B) has
not failed, suspended business operations, become insolvent or called a meeting
of its creditors for the purpose of obtaining any financial concession or
accommodation, (C) has not had or suffered to be appointed a receiver or a
trustee for all or a significant portion of its assets or affairs or (D) in the
case of an Account Debtor who is an individual, is not an employee of the
Borrower or any of its Affiliates and has not died or been declared incompetent;
and (xii) the Administrative Agent is, and continues to be, satisfied with the
credit standing of the Account Debtor in relation to the amount of credit
extended and the Administrative Agent believes, in its discretion, that the
prospect of collection of such Account Receivable is not impaired for any
reason.
"Eligible Inventory" means all finished goods and raw materials
Inventory that meets all of the following specifications: (i) such Inventory is
lawfully owned by the Borrower free and clear of any existing Lien, other than
that of the Collateral Agent for the benefit of the Lenders under the Loan
Documents; (ii) such Inventory is not held on consignment and may be lawfully
sold and it continues to be in full conformity with all representations and
warranties made by the Borrower with respect thereto in the Loan Documents;
(iii) the Borrower has the right to grant Liens on such Inventory; (iv) such
Inventory arose or was acquired in the ordinary course of the business of the
Borrower and does not represent damaged, obsolete or unsalable goods; (v) no
Account Receivable or document of title has been created or issued with respect
to such Inventory; (vi) such Inventory is located in one of the locations in one
of the continental United States listed on Schedule 6.01(ee) or such other
locations in the continental United States as the Collateral Agent may approve
in writing from time to time; (vii) if such Inventory consists of finished goods
Inventory sold under a licensed trademark (A) the Collateral Agent shall have
entered into a waiver letter, in form and substance satisfactory to the
Collateral Agent, with the licensor with respect to the rights of the Collateral
Agent to use the licensed trademark to sell or otherwise dispose of such
Inventory or (B) the Collateral Agent shall otherwise be satisfied, in its sole
discretion, that the Collateral Agent has rights to sell or dispose of such
Inventory; (viii) the Inventory is not work-in-process, supplies or packaging;
and (ix) such Inventory is and at all times shall continue to be acceptable to
the Administrative Agent in the exercise of its reasonable business judgement.
"Employee Plan" means an employee benefit plan (other than a
Multiemployer Plan) covered by Title IV of ERISA and maintained (or was
maintained at any time during the six (6) calendar years preceding the date of
any borrowing hereunder) for employees of the Borrower or any of its ERISA
Affiliates.
"Environmental Actions" means any complaint, summons, citation,
notice, directive, order, claim, litigation, investigation, judicial or
administrative proceeding, judgment, letter or other communication from any
Governmental Authority involving violations of Environmental Laws or Releases of
Hazardous Materials (i) from any assets, properties or businesses of any Loan
Party or any of its Subsidiaries or any predecessor in interest; (ii) from
adjoining properties or businesses; or (iii) onto any facilities which received
Hazardous Materials generated by any Loan Party or any of its Subsidiaries or
any predecessor in interest.
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"Environmental Indemnity Agreement" means an Environmental Indemnity
Agreement, in form and substance satisfactory to the Collateral Agent, made by a
Loan Party in favor of the Collateral Agent.
"Environmental Laws" means the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. Section 9601, et seq.), the Hazardous
Materials Transportation Act (49 U.S.C. Section 1801, et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901, et seq.), the Federal
Clean Water Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act (42 U.S.C.
Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. Section 2601
et seq.) and the Occupational Safety and Health Act (29 U.S.C. Section 651 et
seq.), as such laws may be amended or otherwise modified from time to time, and
any other present or future federal, state, local or foreign statute, ordinance,
rule, regulation, order, judgment, decree, permit, license or other binding
determination of any Governmental Authority imposing liability or establishing
standards of conduct for protection of the environment.
"Environmental Liabilities and Costs" means all liabilities,
monetary obligations, Remedial Actions, losses, damages, punitive damages,
consequential damages, treble damages, costs and expenses (including all
reasonable fees, disbursements and expenses of counsel, experts and consultants
and costs of investigations and feasibility studies), fines, penalties,
sanctions and interest incurred as a result of any claim or demand by any
Governmental Authority or any third party, and which relate to any environmental
condition or a Release of Hazardous Materials from or onto (i) any property
presently or formerly owned by any Loan Party or any of its Subsidiaries or (ii)
any facility which received Hazardous Materials generated by any Loan Party or
any of its Subsidiaries.
"Environmental Lien" means any Lien in favor of any Governmental
Authority for Environmental Liabilities and Costs.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and any successor statute of similar import, and regulations
thereunder, in each case as in effect from time to time. References to sections
of ERISA shall be construed also to refer to any successor sections.
"ERISA Affiliate" means, with respect to any Person, any trade or
business (whether or not incorporated) which is a member of a group of which
such Person is a member and which would be deemed to be a "controlled group"
within the meaning of Sections 414(b), (c), (m) and (o) of the Code.
"Event of Default" means any of the events set forth in Section
8.01.
"Excess Cash Flow" means, with respect to any Person for any period,
(i) Consolidated Net Income of such Person and its Subsidiaries for such period,
plus (ii) all non-cash items of such Person and its Subsidiaries deducted in
determining Consolidated Net Income for such period, less (iii) the sum of (A)
all non-cash items of such Person and its Subsidiaries included in determining
Consolidated Net Income for such period, (B) all scheduled and mandatory cash
principal payments on the Loans made during such period (but, in the case of the
Revolving
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18
Loans, only to the extent that the Revolving Credit Commitment is permanently
reduced by the amount of such payments), and all scheduled cash principal
payments on other Indebtedness of such Person or any of its Subsidiaries during
such period to the extent such other Indebtedness is permitted to be incurred,
and such payments are permitted to be made, under this Agreement, and (C) the
cash portion of Capital Expenditures made by such Person and its Subsidiaries
during such period to the extent permitted to be made under this Agreement, plus
(iv) extraordinary cash gains (other than the proceeds of any judgment, award,
settlement or other similar payment with respect to the Rubbermaid Proceedings)
of such Person and its Subsidiaries during such period.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Credit Facility" has the meaning specified therefor in the
preamble hereto.
"Existing Lender" has the meaning specified therefor in the preamble
hereto.
"Expense Deposit" means the expense deposit in the amount of
$150,000 paid by the Parent to the Collateral Agent on or prior to the Effective
Date to pay the out-of-pocket costs and expenses of the Agents in connection
with the performance of due diligence, the appraising and securing of Collateral
and other property and assets of the Loan Parties, and the preparation of
agreements, instruments and other documents in connection with the transactions
contemplated hereby and by the other Loan Documents, and otherwise in connection
with the consummation of such transactions.
"Facility" means the real property located at 0 Xxxx Xxxxxx, Xxxx
Xxxxxx, XX 00000, including, without limitation, the land on which such facility
is located, all buildings and other improvements thereon, all fixtures located
at such facility, all whether now or hereafter existing.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period of the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.
"Final Maturity Date" means April 30, 2002 or such earlier date on
which any Loan shall become due and payable, in whole or in part, in accordance
with the terms of this Agreement and the other Loan Documents.
"Financial Statements" means (i) the audited consolidated balance
sheet of the Parent and its Consolidated Subsidiaries for the Fiscal Years ended
March 31, 1999 and March 31, 1998 and the related consolidated statement of
operations, shareholders' equity and cash flows for each Fiscal Year then ended,
(ii) the unaudited consolidated balance sheet of the Parent and its Consolidated
Subsidiaries for the three months ended June 30th, September 30th and December
31, 1999 and the related consolidated statement of operations, shareholders'
equity and cash flows for each period then ended, (iii) the Parent's
consolidating balance sheet and related statement of
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19
operations for the Fiscal Year ended March 31, 1997 and (iv) the estimated
balance sheet for Borrower as of March 31, 2000.
"Fiscal Year" means the fiscal year of the Parent and its
Subsidiaries ending on March 31 of each year.
"Fixed Charge Coverage Ratio" means, for any period, the ratio of
(i) Consolidated EBITDA of the Borrower and its Subsidiaries for such period, to
(ii) the sum of (A) all principal of Indebtedness of the Borrower and its
Subsidiaries scheduled to be paid or prepaid during such period (not including
prepayments of the Revolving Loans unless such prepayments are accompanied by a
reduction of the Revolving Credit Commitment), plus (B) Consolidated Net
Interest Expense of the Borrower and its Subsidiaries for such period, plus (C)
income taxes paid or payable by the Borrower and its Subsidiaries during such
period, plus (D) cash dividends or distributions paid by the Borrower and its
Subsidiaries (other than dividends or distributions paid to the Borrower) during
such period, including, but not limited to, any payments, loans, advances,
dividends or other disbursements made by the Borrower to the Parent the proceeds
of which are used to make interest payments on the Senior Secured Notes or
otherwise, plus (E) Capital Expenditures made by the Borrower and its
Subsidiaries during such period, plus (F) all amounts paid or payable by the
Borrower and its Subsidiaries on Operating Lease Obligations having a scheduled
due date during such period. In determining the Fixed Charge Coverage Ratio for
a particular period (A) pro forma effect will be given to: (1) the incurrence,
repayment or retirement of any Indebtedness by the Borrower and its Subsidiaries
since the first day of such period as if such Indebtedness was incurred, repaid
or retired on the first day of such period and (2) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any property or assets acquired or disposed of by the Borrower and
its Subsidiaries since the first day of such period, as if such acquisition or
disposition occurred on the first day of such period; (B) interest on
Indebtedness bearing a floating interest rate will be computed as if the rate of
computation had been the applicable rate for the entire period; (C) if such
Indebtedness bears, at the option of the Borrower and its Subsidiaries, a fixed
or floating rate of interest, interest thereon will be computed by applying, at
the option of the Borrower, either the fixed or floating rate; and (D) the
amount of Indebtedness under a revolving credit facility will be computed based
upon the average daily balance of such Indebtedness during such period.
"Fleet Documents" means the Fleet Letter of Credit, the Fleet
Reimbursement Agreement, the Fleet Revolving Credit Agreement, the Fleet Pledge
and Assignment, the Fleet Pledge Agreement, the Fleet Security Agreement and all
other agreements, instruments, and other documents executed and delivered
pursuant thereto.
"Fleet Letter of Credit" means the irrevocable, transferable direct
pay letter of credit dated November 13, 1996, issued by the Existing Lender
pursuant to the XXX Indenture to provide support for the XXX Xxxxx.
"Fleet Pledge Agreement" means the Pledge and Security Agreement
dated as of November 1, 1996 by and between the Borrower and the Existing
Lender.
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"Fleet Pledge and Assignment" means the Pledge and Assignment dated
as of November 1, 1996 from the XXX to the XXX Trustee and the Existing Lender.
"Fleet Reimbursement Agreement" means the Credit and Reimbursement
Agreement dated as of November 1, 1996 by and between the Borrower and the
Existing Lender, as amended by Credit and Reimbursement Agreement Modification
No. 1, dated as of March 27, 1997, Credit and Reimbursement Agreement
Modification Agreement No. 2, dated as of September 26, 1997, and Credit and
Reimbursement Agreement Modification Agreement No. 3, dated as of April 29,
1998.
"Fleet Revolving Credit Agreement" means the Restated Secured
Revolving Line of Credit Agreement, dated as of April 29, 1998, by and between
the Borrower and the Existing Lender, as amended by the Amendment to Loan
Agreement dated February 20, 2000.
"Fleet Security Agreement" means the Security Agreement dated as of
November 1, 1996 by and between the Borrower and the Existing Lender, as amended
by the Restated Security Agreement, dated as of April 17, 1998.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States, applied on a consistent basis, provided that
for the purpose of Section 6.03 hereof and the definitions used therein, "GAAP"
shall mean generally accepted accounting principles in effect on the date hereof
and consistent with those used in the preparation of the Financial Statements,
provided, further, that if there occurs after the date of this Agreement any
change in GAAP that affects in any respect the calculation of any covenant
contained in Section 6.03 hereof, the Collateral Agent and the Parent shall
negotiate in good faith amendments to the provisions of this Agreement that
relate to the calculation of such covenant with the intent of having the
respective positions of the Lenders and the Parent after such change in GAAP
conform as nearly as possible to their respective positions as of the date of
this Agreement and, until any such amendments have been agreed upon, the
covenants in Section 6.03 hereof shall be calculated as if no such change in
GAAP has occurred.
"German Holdings" means Decora Industries Deutschland GmbH, a German
company and a wholly owned Subsidiary of the Parent, and its successors.
"Governmental Authority" means any nation or government, any
Federal, state, city, town, municipality, county, local or other political
subdivision thereof or thereto and any department, commission, board, bureau,
instrumentality, agency or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guaranties" means (i) the guaranty of the Parent contained in
Article XI hereof, and (ii) each guaranty substantially in the form of Exhibit
C, made by a Guarantor (other than the Parent) in favor of the Collateral Agent
for the benefit of the Lenders pursuant to Section 7.01(b).
"Guarantor" means (i) the Parent, and (ii) each other Person which
guarantees, pursuant to Section 7.01(b) or otherwise, all or any part of the
Obligations.
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"Hazardous Materials" means (a) any element, compound or chemical
that is defined, listed or otherwise classified as a contaminant, pollutant,
toxic pollutant, toxic or hazardous substances, extremely hazardous substance or
chemical, hazardous waste, special waste, or solid waste under Environmental
Laws; (b) petroleum and its refined products; (c) polychlorinated biphenyls; (d)
any substance exhibiting a hazardous waste characteristic, including but not
limited to, corrosivity, ignitability, toxicity or reactivity as well as any
radioactive or explosive materials; and (e) any raw materials, building
components, including but not limited to asbestos-containing materials and
manufactured products containing hazardous substances.
"Hedging Agreement" means any interest rate, foreign currency,
commodity or equity swap, collar, cap, floor or forward rate agreement, or other
agreement or arrangement designed to protect against fluctuations in interest
rates or currency, commodity or equity values (including, without limitation,
any option with respect to any of the foregoing and any combination of the
foregoing agreements or arrangements), and any confirmation executed in
connection with any such agreement or arrangement.
"Hornschuch" means Xxxxxx Xxxxxxxxxx AG, a German company and a
Subsidiary of German Holdings, and its successors.
"XXX" means the Counties of Xxxxxx and Washington Industrial
Development Agency and any public benefit corporation or political subdivision
resulting from or surviving any consolidation or merger to which it or its
successors or assigns may be a party.
"XXX Xxxxx" means the Tax-Exempt Industrial Development Revenue
Bonds (Decora, Incorporated Project), Series 1996 issued pursuant to the Trust
Indenture, and any bond or bonds issued in exchange or substitution thereof.
"XXX Indenture" means the Trust Indenture dated as of November 1,
1996 by and between the XXX and the XXX Trustee.
"XXX Indenture Documents" means the XXX Indenture, the XXX Xxxxx,
the Installment Sale Agreement and all other agreements, instruments, and other
documents executed and delivered pursuant thereto.
"XXX Payment Amount" means the amount necessary to satisfy in full
all of the obligations for the payment of money of the XXX and the Borrower
under the XXX Indenture Documents and the Fleet Documents.
"XXX Trustee" means Mellon Bank, F.S.B., a Federal savings bank
organized and existing under the laws of the United States, or any successor
trustee or co-trustee, acting as trustee under the Trust Indenture.
"Indebtedness" means, without duplication, with respect to any
Person, (i) all indebtedness of such Person for borrowed money; (ii) all
obligations of such Person for the deferred purchase price of property or
services (other than trade payables or other account payables incurred in the
ordinary course of such Person's business and not past due for more than 90 days
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22
after the date such payable was created); (iii) all obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments or upon which
interest payments are customarily made; (iv) all obligations and liabilities of
such Person created or arising under any conditional sales or other title
retention agreement with respect to property used and/or acquired by such
Person, even though the rights and remedies of the lessor, seller and/or lender
thereunder are limited to repossession or sale of such property; (v) all
Capitalized Lease Obligations of such Person; (vi) all obligations and
liabilities, contingent or otherwise, of such Person, in respect of letters of
credit, acceptances and similar facilities; (vii) all obligations and
liabilities, calculated on a basis satisfactory to the Collateral Agent and in
accordance with accepted practice, of such Person under Hedging Agreements;
(viii) all Contingent Obligations; (ix) liabilities incurred under Title IV of
ERISA with respect to any plan (other than a Multiemployer Plan) covered by
Title IV of ERISA and maintained for employees of such Person or any of its
ERISA Affiliates; (x) withdrawal liability incurred under ERISA by such Person
or any of its ERISA Affiliates to any Multiemployer Plan; (xi) all other items
which, in accordance with GAAP, would be included as liabilities on the
liability side of the balance sheet of such Person; and (xii) all obligations
referred to in clauses (i) through (xi) of this definition of another Person
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien upon property owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness. The Indebtedness of any Person shall include the
Indebtedness of any partnership of or joint venture in which such Person is a
general partner or a joint venturer.
"Indemnified Matters" has the meaning specified therefor in Section
12.15.
"Indemnitees" has the meaning specified therefor in Section 12.15.
"Indenture" means Indenture dated as of April 29, 1998 among the
Parent, the Borrower, any future guarantors that become party thereto and the
Trustee.
"Indenture Borrowing Base" means the difference between (i) the
greater of (A) $15.0 million and (B) the sum of 85% of the book value of the
Accounts Receivable and 60% of the book value of Inventory of the Parent and its
Restricted Subsidiaries (other than any Foreign Subsidiary) (as each such term
is defined in the Indenture), calculated on a consolidated basis in accordance
with GAAP and (ii) $9.0 million, provided, that, at any time following the
German Holdings Revocation (as defined in the Indenture), the $9.0 million
amount set forth in clause (ii) may be reduced a single time by up to $2.0
million at the option of the Borrower by delivering to the Agents a written
notice of such election.
"Indenture Documents" means (i) the Indenture, (ii) the Senior
Secured Notes, (iii) the Pledge Agreement dated April 28, 1998 between the
Parent and the Trustee relating to the Parent's pledge of its shares in the
Borrower and any future Subsidiaries of the Parent, (iv) the Pledge Agreement
dated April 29, 1998 between the Parent and the Trustee relating to the Parent's
pledge of 65% of its shares of German Holdings, (v) the Registration Rights
Agreement dated April 29, 1998 among the Parent, the guarantors party thereto
and the initial purchasers party thereto, and (vi) all other agreements,
instruments, and other documents executed and delivered pursuant to any of the
foregoing.
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"Insolvency Proceeding" means any proceeding commenced by or against
any Person under any provision of the Bankruptcy Code or under any other
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.
"Installment Sale Agreement" means the Installment Sale Agreement
dated as of November 1, 1996 by and between the XXX and the Borrower.
"Intercompany Loan Documents" means the Loan Agreement dated as of
April 28, 1998 between Hornschuch and the Borrower, and all other agreements,
instruments and other documents executed and delivered pursuant thereto.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended (or any successor statute thereto) and the regulations thereunder.
"Inventory" means all goods and merchandise of the Borrower,
including, without limitation, all raw materials, work-in-process, packaging,
supplies, materials and finished goods of every nature used or usable in
connection with the shipping, storing, advertising or sale of such goods and
merchandise, whether now owned or hereafter acquired, and all such other
property the sale or other disposition of which would give rise to an Account
Receivable or cash.
"Lease" means any lease of real property to which any Loan Party is
a party as lessor or lessee.
"L/C Issuer" means the Bank or such other bank as the Administrative
Agent may select in its sole and absolute discretion.
"L/C Subfacility" means that portion of the Total Revolving Credit
Commitment equal to $2,092,330.68.
"Lender" has the meaning specified therefor in the preamble hereto.
"Letter of Credit Application" has the meaning specified therefor in
Section 3.01(a).
"Letter of Credit Fee" has the meaning specified therefor in Section
3.03(b).
"Letter of Credit Guaranty" means one or more guaranties by the
Administrative Agent in favor of the L/C Issuer guaranteeing the Borrower's
obligations to the L/C Issuer under a reimbursement agreement, Letter of Credit
Application or other like document in respect of the Support Letter of Credit.
"Letter of Credit Obligations" means, at any time and without
duplication, the sum of (i) the Reimbursement Obligations at such time, plus
(ii) the aggregate maximum amount available for drawing under the Support Letter
of Credit at such time, plus (iii) all amounts for
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which the Administrative Agent may be liable to the L/C Issuer pursuant to any
Letter of Credit Guaranty.
"Liabilities" has the meaning specified therefor in Section 2.07.
"Lien" means any mortgage, deed of trust, pledge, lien (statutory or
otherwise), security interest, charge or other encumbrance or security or
preferential arrangement of any nature, including, without limitation, any
conditional sale or title retention arrangement, any Capitalized Lease and any
assignment, deposit arrangement or financing lease intended as, or having the
effect of, security.
"Loan" means any Term Loan or Revolving Loan made by an Agent or a
Lender to the Borrower pursuant to Article II hereof.
"Loan Account" means an account maintained hereunder by the
Administrative Agent on its books of account, at the Payment Office and with
respect to the Borrower, in which the Borrower will be charged with all Loans
made to, and all other Obligations incurred by, the Borrower.
"Loan Documents" means this Agreement, the Notes, the Guaranties,
the Security Agreements, the Pledge Agreements, the Mortgages, the Letter of
Credit Applications, the Environmental Indemnity Agreement and all other
agreements, instruments, and other documents executed and delivered pursuant
hereto or thereto or otherwise evidencing or securing any Loan, Letter of Credit
Obligation or other Obligation.
"Loan Parties" means the Parent, the Borrower and each other
Guarantor.
"Loan Servicing Fee" has the meaning specified therefor in Section
2.06(d).
"Lockbox Bank" has the meaning specified therefor in Section 8.01.
"Lockboxes" has the meaning specified therefor in Section 8.01.
"Material Adverse Effect" means a material adverse effect on any of
(i) the operations, business, assets, properties, condition (financial or
otherwise) or prospects of any Loan Party, (ii) the ability of any Loan Party to
perform any of its obligations under any Loan Document to which it is a party,
(iii) the legality, validity or enforceability of this Agreement or any other
Loan Document, (iv) the rights and remedies of the Agents and the Lenders under
any Loan Document, or (v) the validity, perfection or priority of a Lien in
favor of the Collateral Agent for the benefit of the Lenders on any of the
Collateral.
"Material Contract" means, with respect to any Person, each contract
or agreement to which such Person or its Subsidiary is a party involving
aggregate consideration payable to or by such Person or such Subsidiary of
$500,000 or more (other than purchase orders in the ordinary course of the
business of such Person and other than contracts that by their terms may be
terminated by such Person or Subsidiary in the ordinary course of its business
upon less than 60 days' notice
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without penalty or premium) or otherwise material to the business, operations,
condition (financial or otherwise), performance, prospects or properties of such
Person or such Subsidiary.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Mortgage" means each Mortgage, Deed of Trust or Deed to Secure
Debt, in form and substance satisfactory to the Collateral Agent, made by the
Borrower in favor of the Collateral Agent for the benefit of the Lenders,
securing the Obligations and delivered to the Collateral Agent pursuant to
Article V or Section 7.01(b).
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA for which the Borrower or any ERISA Affiliate has
contributed to, or has been obligated to contribute to, at any time during the
preceding six (6) years.
"Net Amount of Eligible Accounts Receivable" means the aggregate
unpaid invoice amount of Eligible Accounts Receivable less, without duplication,
sales, excise or similar taxes, returns, discounts, chargebacks, claims, advance
payments, credits and allowances of any nature at any time issued, owing,
granted, outstanding, available or claimed.
"Net Cash Proceeds" means, (i) with respect to any Disposition by
any Person, the amount of cash received (directly or indirectly) from time to
time (whether as initial consideration or through the payment of deferred
consideration) by or on behalf of such Person or any of its Subsidiaries or
Affiliates, in connection therewith after deducting therefrom only (A) the
principal amount of any Indebtedness secured by any Lien permitted by Section
7.02(a) on any asset (other than Indebtedness assumed by the purchaser of such
asset) which is required to be, and is, repaid in connection with such
Disposition (other than Indebtedness under this Agreement), (B) reasonable
expenses related thereto reasonably incurred by such Person or such Affiliate in
connection therewith, (C) transfer taxes paid by such Person or such Affiliate
in connection therewith, and (D) net income taxes to be paid in connection with
such Disposition (after taking into account any tax credits or deductions and
any tax sharing arrangements and (ii) with respect to the issuance or incurrence
of any Indebtedness by any Person, or the sale or issuance by any Person of any
shares of its Capital Stock, the aggregate amount of cash received (directly or
indirectly) from time to time (whether as initial consideration or through the
payment of deferred consideration) by or on behalf of such Person or any of its
Subsidiaries or Affiliates in connection therewith after deducting therefrom
only reasonable brokerage commissions, underwriting fees and discounts, legal
fees and similar fees and commissions.
"Notes" means the Revolving Credit Notes, the Term A Notes, Term B
Notes and the Term C Notes.
"Notice of Borrowing" has the meaning specified therefor in Section
2.02.
"Obligations" means (i) the obligations of the Borrower to pay, as
and when due and payable (by scheduled maturity, required prepayment,
acceleration, demand or otherwise), all amounts from time to time owing by it in
respect of the Loan Documents, whether for principal, interest (including,
without limitation, all interest that accrues after the commencement of any
case,
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proceeding or other action relating to bankruptcy, insolvency or reorganization
of the Borrower), Letter of Credit Obligations, fees, indemnification payments,
expense reimbursements or otherwise, and (ii) the obligations of the Borrower
and any other Loan Party to perform or observe all of its obligations from time
to time existing under the Loan Documents.
"Operating Lease Obligations" means all obligations for the payment
of rent for any real or personal property under leases or agreements to lease,
other than Capitalized Lease Obligations.
"Parent" has the meaning specified therefor in the Preamble.
"Participant Register" has the meaning specified therefor in Section
12.07(b)(v).
"Payment Office" means the Administrative Agent's office located at
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other office
or offices of the Administrative Agent as may be designated in writing from time
to time by the Administrative Agent to the Collateral Agent and the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Permitted Indebtedness" means:
(a) any Indebtedness owing to the Agents and the Lenders under this
Agreement and the other Loan Documents;
(b) the Indebtedness under the Indenture and the Senior Secured
Notes, the XXX Indenture Documents, the Intercompany Loan Documents, the WCLDC
Loan Documents and any Indebtedness listed on Schedule 7.02(b), and the
extension of maturity, refinancing or modification of the terms thereof;
provided, however, that (i) such extension, refinancing or modification is
pursuant to terms that are not less favorable to the Borrower and the Lenders
than the terms of the Indebtedness being extended, refinanced or modified and
(ii) after giving effect to the extension, refinancing or modification, such
Indebtedness is not greater than the amount of Indebtedness outstanding
immediately prior to such extension, refinancing or modification;
(c) Indebtedness evidenced by Capitalized Lease Obligations entered
into in order to finance Capital Expenditures made by the Borrower in accordance
with the provisions of Section 7.02(g), which Indebtedness, when aggregated with
the principal amount of all Indebtedness incurred under this clause (c) and
clause (d) of this definition, does not exceed $100,000 at any time outstanding;
(d) Indebtedness permitted by clause (e) of the definition of
"Permitted Lien";
(e) Indebtedness permitted under Section 7.02(e); and
(f) Subordinated Indebtedness.
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"Permitted Investments" means (i) marketable direct obligations
issued or unconditionally guaranteed by the United States Government or issued
by any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within six months from the date of acquisition
thereof; (ii) commercial paper, maturing not more than 270 days after the date
of issue rated P-1 by Moody's or A-1 by Standard & Poor's; (iii) certificates of
deposit maturing not more than 270 days after the date of issue, issued by
commercial banking institutions and money market or demand deposit accounts
maintained at commercial banking institutions, each of which is a member of the
Federal Reserve System and has a combined capital and surplus and undivided
profits of not less than $500,000,000; (iv) repurchase agreements having
maturities of not more than 90 days from the date of acquisition which are
entered into with major money center banks included in the commercial banking
institutions described in clause (iii) above and which are secured by readily
marketable direct obligations of the Government of the United States of America
or any agency thereof, (v) money market accounts maintained with mutual funds
having assets in excess of $2,500,000,000, and (vi) tax exempt securities rated
A or better by Moody's or A+ or better by Standard & Poor's.
"Permitted Liens" means:
(a) Liens securing the Obligations;
(b) Liens for taxes, assessments and governmental charges the
payment of which is not required under Section 7.01(c);
(c) Liens imposed by law, such as carriers', warehousemen's,
mechanics', materialmen's and other similar Liens arising (provided they are
subordinate to the Collateral Agent's Liens on Collateral) in the ordinary
course of business and securing obligations (other than Indebtedness for
borrowed money) that are not overdue by more than 30 days or are being contested
in good faith and by appropriate proceedings promptly initiated and diligently
conducted, and a reserve or other appropriate provision, if any, as shall be
required by GAAP shall have been made therefor;
(d) Liens described on Schedule 7.02(a), but not the extension of
coverage thereof to other property or the extension of maturity, refinancing or
other modification of the terms thereof (except for the filing of Form UCC-3
continuation statements) or the increase of the Indebtedness secured thereby;
(e) (i) purchase money Liens on equipment acquired or held by the
Borrower in the ordinary course of its business to secure the purchase price of
such equipment or Indebtedness incurred solely for the purpose of financing the
acquisition of such equipment or (ii) Liens existing on such equipment at the
time of its acquisition; provided, however, that (A) no such Lien shall extend
to or cover any other property of any Loan Party, (B) the principal amount of
the Indebtedness secured by any such Lien shall not exceed the lesser of 80% of
the fair market value or the cost of the property so held or acquired and (C)
the aggregate principal amount of Indebtedness secured by any or all such Liens
shall not exceed at any one time outstanding $1,000,000;
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(f) deposits and pledges securing (i) obligations incurred in
respect of workers' compensation, unemployment insurance or other forms of
governmental insurance or benefits, (ii) the performance of bids, tenders,
leases, contracts (other than for the payment of money) and statutory
obligations or (iii) obligations on surety or appeal bonds, but only to the
extent such deposits or pledges are incurred or otherwise arise in the ordinary
course of business and secure obligations not past due;
(g) easements, zoning restrictions and similar encumbrances on real
property and minor irregularities in the title thereto that do not (i) secure
obligations for the payment of money or (ii) materially impair the value of such
property or its use by any Loan Party or any of its Subsidiaries in the normal
conduct of such Person's business, including, without limitation, any easements,
zoning restrictions and similar encumbrances reflected in the Title Insurance
Policy and accepted by the Collateral Agent as of the Effective Date; and
(h) Liens securing Indebtedness evidencing Capitalized Lease
Obligations described under subsection (c) of the definition of Permitted
Indebtedness.
"Person" means an individual, corporation, limited liability
company, partnership, association, joint-stock company, trust, unincorporated
organization, joint venture or Governmental Authority.
"Pledge Agreements" means the Pledge and Security Agreements made by
each of the Loan Parties in favor of the Collateral Agent for the benefit of the
Lenders, substantially in the form of Exhibits F and G, securing the Obligations
and delivered to the Collateral Agent.
"Post-Default Rate" means a rate of interest per annum equal to the
rate of interest otherwise in effect from time to time pursuant to the terms of
this Agreement plus 2%, or, if a rate of interest is not otherwise in effect,
the Reference Rate plus 2%.
"property" means any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.
"Pro Rata Share" means:
(a) with respect to a Lender's obligation to make Revolving Loans
and receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender's Revolving Credit Commitment,
by (ii) the Total Revolving Commitment, provided, that, if the Revolving Credit
Commitments have been reduced to zero, the numerator shall be the aggregate
unpaid principal amount of such Lender's Revolving Loans (including Collateral
Agent Advances) and its interest in the Letter of Credit Obligations and the
denominator shall be the aggregate unpaid principal amount of all of the
Revolving Loans (including Collateral Agent Advances) and Letter of Credit
Obligations,
(b) with respect to a Lender's obligation to make the Term Loan A
and receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender's Term Loan A Commitment, by
(ii) the Total Term Loan A Commitment,
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(c) with respect to a Lender's obligation to make the Term Loan B
and receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender's Term Loan B Commitment, by
(ii) the Total Term Loan B Commitment,
(d) with respect to a Lender's obligation to make the Term Loan C
and receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender's Term Loan C Commitment, by
(ii) the Total Term Loan C Commitment, and
(e) with respect to all other matters (including, without
limitation, the indemnification obligations arising under Section 10.05), the
percentage obtained by dividing (i) the sum of such Lender's Revolving Credit
Commitment and principal amount of Term Loans, by (ii) the sum of the Total
Revolving Credit Commitment and the aggregate principal amount of all Term
Loans.
"Rating Agencies" has the meaning specified therefor in Section
2.07.
"Reference Bank" means The Chase Manhattan Bank, N.A., its
successors or any other commercial bank designated by the Collateral Agent to
the Borrower from time to time.
"Reference Rate" means the rate of interest publicly announced by
the Reference Bank in New York, New York from time to time as its prime rate or
base rate. The prime rate or base rate is determined from time to time by the
Reference Bank as a means of pricing some loans to its borrowers and neither is
tied to any external rate of interest or index nor necessarily reflects the
lowest rate of interest actually charged by the Reference Bank to any particular
class or category of customers. Each change in the Reference Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"Register" has the meaning specified therefor in Section
12.07(b)(ii).
"Registered Loan" has the meaning specified therefor in Section
2.03(f).
"Registered Note" has the meaning specified therefor in Section
2.03(f).
"Regulation T", "Regulation U" and "Regulation X" mean,
respectively, Regulations T, U and X of the Board or any successor, as the same
may be amended or supplemented from time to time.
"Reimbursement Obligations" means the obligation of the Borrower to
reimburse the Administrative Agent and the Lenders for amounts payable by the
Administrative Agent or the Lenders under a Letter of Credit Guaranty in respect
of any drawing made under the Support Letter of Credit, together with interest
thereon as provided in Section 2.04.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, seeping, migrating,
dumping or disposing of any Hazardous Material (including the abandonment or
discarding of barrels, containers and other
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closed receptacles containing any Hazardous Material) into the indoor or outdoor
environment, including ambient air, soil, surface or ground water.
"Remedial Action" means all actions taken to (i) clean up, remove,
remediate, contain, treat, monitor, assess, evaluate or in any other way address
Hazardous Materials in the indoor or outdoor environment; (ii) prevent or
minimize a Release or threatened Release of Hazardous Materials so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; (iii) perform pre-remedial studies and
investigations and post-remedial operation and maintenance activities; or (iv)
any other actions authorized by 42 U.S.C. 9601.
"Reportable Event" means an event described in Section 4043 of ERISA
(other than an event not subject to the provision for 30-day notice to the PBGC
under the regulations promulgated under such Section).
"Required Lenders" means Lenders whose Pro Rata Share of the Term
Loans aggregate at least 50%.
"Revolving Credit Commitment" means, with respect to each Lender,
the commitment of such Lender to make Revolving Loans to the Borrower in the
amount set forth opposite such Lender's name in Schedule 1.01(A) hereto, as such
amount may be terminated or reduced from time to time in accordance with the
terms of this Agreement.
"Revolving Credit Note" means a promissory note of the Borrower,
substantially in the form of Exhibit B, made payable to the order of a Lender,
evidencing the Indebtedness resulting from the making by such Lender to the
Borrower of Revolving Loans and delivered to such Lender pursuant to Article V,
as such promissory note may be amended, supplemented, restated, modified or
extended from time to time, and any promissory note or notes issued in exchange
or replacement therefor. The term "Revolving Credit Note" shall include any
Registered Note evidencing the Revolving Loans and delivered pursuant to Section
2.03(a).
"Revolving Loan" means a loan made by a Lender to the Borrower
pursuant to Section 2.01(a)(i).
"Revolving Loan Obligations" means any Obligations with respect to
the Revolving Loans (including, without limitation, the principal thereof, the
interest thereon, and fees and expenses specifically related thereto).
"Rubbermaid Proceedings" means those certain legal proceedings
instituted by the Borrower and the Parent against Rubbermaid Incorporated as
described in Schedule 6.01(f) hereof.
"SEC" means the Securities and Exchange Commission or any other
similar or successor agency of the Federal government administering the
Securities Act.
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"Securities Act" means the Securities Act of 1933, as amended, or
any similar Federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect at the time.
"Securitization" has the meaning specified therefor in Section 2.07.
"Securitization Parties" has the meaning specified therefor in
Section 2.07.
"Security Agreements" means the Security Agreements made by each of
the Loan Parties in favor of the Collateral Agent for the benefit of the
Lenders, substantially in the form of Exhibits D and E, securing the Obligations
and delivered to the Collateral Agent.
"Senior Secured Notes" means the Parent's 11% Senior Secured Notes
due 2005 and the 11% Senior Secured Notes due 2005, Series B, in each case,
issued pursuant to the Indenture.
"Settlement Period" has the meaning specified therefor in Section
2.2(d)(i) hereof.
"Solvent" means, with respect to any Person on a particular date,
that on such date (i) the fair value of the property of such Person is not less
than the total amount of its liabilities of such Person, (ii) the present fair
salable value of the assets of such Person is not less than the amount that will
be required to pay the probable liability of such Person on its existing debts
as they become absolute and matured, (iii) such Person is able to realize upon
its assets and pay its debts and other liabilities, contingent obligations and
other commitments as they mature in the normal course of business, (iv) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, and (v) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person's
property would constitute unreasonably small capital.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc. and any successor thereto.
"Subordinated Indebtedness" means Indebtedness of the Borrower the
terms of which are satisfactory to the Agents and which has been expressly
subordinated in right of payment to all Indebtedness of the Borrower under the
Loan Documents (i) by the execution and delivery of a subordination agreement,
in form and substance satisfactory to the Agents, or (ii) otherwise on terms and
conditions (including, without limitation, subordination provisions, payment
terms, interest rates, covenants, remedies, defaults and other material terms)
satisfactory to the Agents.
"Subsidiary" means, with respect to any Person at any date, any
corporation, limited or general partnership, limited liability company, trust,
association or other entity (i) the accounts of which would be consolidated with
those of such Person in such Person's consolidated financial statements if such
financial statements were prepared in accordance with GAAP or (ii) of which more
than 50% of (A) the outstanding Capital Stock having (in the absence of
contingencies) ordinary voting power to elect a majority of the board of
directors of such corporation, (B) the interest in the capital or profits of
such partnership or limited liability company or (C) the beneficial interest in
such trust or estate is, at the time of determination, owned or controlled
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directly or indirectly through one or more intermediaries, by such Person;
provided, however, that the term Subsidiary shall exclude German Holdings,
Hornschuch and any other foreign Subsidiary of any Loan Party.
"Support Letter of Credit" has the meaning specified therefor in
Section 3.01(a).
"Term A Note" means the promissory note of the Borrower,
substantially in the form of Exhibit A-1, made payable to the order of a Lender,
evidencing the Indebtedness resulting from the making by such Lender to the
Borrower of a Term Loan A and delivered to such Lender pursuant to Article V, as
such promissory note may be amended, supplemented, restated, modified or
extended from time to time, and any promissory note or notes issued in exchange
or replacement therefor. The term "Term A Note" shall include any Registered
Note evidencing a Term Loan A and delivered pursuant to Section 2.03(a).
"Term B Note" means the promissory note of the Borrower,
substantially in the form of Exhibit A-2, made payable to the order of a Lender,
evidencing the Indebtedness resulting from the making by such Lender to the
Borrower of a Term Loan B and delivered to such Lender pursuant to Article V, as
such promissory note may be amended, supplemented, restated, modified or
extended from time to time, and any promissory note or notes issued in exchange
or replacement therefor. The term "Term B Note" shall include any Registered
Note evidencing a Term Loan B and delivered pursuant to Section 2.03(a).
"Term C Note" means the promissory note of the Borrower,
substantially in the form of Exhibit A-3, made payable to the order of a Lender,
evidencing the Indebtedness resulting from the making by such Lender to the
Borrower of a Term Loan C and delivered to such Lender pursuant to Article V, as
such promissory note may be amended, supplemented, restated, modified or
extended from time to time, and any promissory note or notes issued in exchange
or replacement therefor. The term "Term C Note" shall include any Registered
Note evidencing a Term Loan C and delivered pursuant to Section 2.03(a).
"Term Loan A" means a loan made by a Lender to the Borrower on the
Effective Date pursuant to Section 2.01(a)(ii).
"Term Loan A Commitment" means, with respect to each Lender, the
commitment of such Lender to make a Term Loan A to the Borrower in the amount
set forth in Schedule 1.01(A) hereto, as the same may be terminated or reduced
from time to time in accordance with the terms of this Agreement.
"Term Loan A Obligations" means any Obligations with respect to the
Term Loans A (including, without limitation, the principal thereof, the interest
thereon, and fees and expenses specifically related thereto).
"Term Loan B" means a loan made by a Lender to the Borrower on the
Effective Date pursuant to Section 2.01(a)(iii).
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"Term Loan B Commitment" means, with respect to each Lender, the
commitment of such Lender to make a Term Loan B to the Borrower in the amount
set forth in Schedule 1.01(A) hereto, as the same may be terminated or reduced
from time to time in accordance with the terms of this Agreement.
"Term Loan B Obligations" means any Obligations with respect to the
Term Loans B (including, without limitation, the principal thereof, the interest
thereon, and fees and expenses specifically related thereto).
"Term Loan C" means a loan made by a Lender to the Borrower on the
Term Loan C Effective Date pursuant to Section 2.01(a)(iv).
"Term Loan C Commitment" means, with respect to each Lender, the
commitment of such Lender to make a Term Loan C to the Borrower in the amount
set forth in Schedule 1.01(A) hereto, as the same may be terminated or reduced
from time to time in accordance with the terms of this Agreement.
"Term Loan C Effective Date" means any date on or before July 6,
2000, on which (i) the Support Letter of Credit shall have been (A) returned to
the L/C Issuer undrawn for cancellation or (B) drawn in full, (ii) the Borrower
has executed and delivered to the Collateral Agent a Term C Note for each Lender
with a Term Loan C Commitment; and (iii) all of the conditions precedent set
forth in Section 5.02 hereof are satisfied.
"Term Loan C Obligations" means any Obligations with respect to the
Term Loans C (including, without limitation, the principal thereof, the interest
thereon, and fees and expenses specifically related thereto).
"Term Loan Obligations" means any Obligations with respect to the
Term Loans (including, without limitation, the principal thereof, the interest
thereon, and fees and expenses specifically related thereto).
"Term Loans" means, collectively, the Term Loans A, the Term Loans B
and the Term Loans C.
"Termination Event" means (i) a Reportable Event with respect to any
Employee Plan, (ii) any event that causes the Borrower or any of its ERISA
Affiliates to incur liability under Section 409, 502(i), 502(l), 515, 4062,
4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the
Code, (iii) the filing of a notice of intent to terminate an Employee Plan or
the treatment of an Employee Plan amendment as a termination under Section 4041
of ERISA, (iv) the institution of proceedings by the PBGC to terminate an
Employee Plan, or (v) any other event or condition which might constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Employee Plan.
"Title Insurance Policy" means the mortgagee's loan policy, together
with all endorsements made from time to time thereto, issued by or on behalf of
a title insurance company satisfactory in form and substance to the Collateral
Agent, insuring the Lien created by the
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Mortgages in an amount and on terms satisfactory to the Collateral Agent,
delivered to the Collateral Agent pursuant to Article III hereof.
"Total Commitment" means the sum of the Total Revolving Credit
Commitment, the Total Term Loan A Commitment, the Total Term Loan B Commitment
and the Total Term Loan C Commitment.
"Total Revolving Credit Commitment" means the sum of the amounts of
the Lenders' Revolving Credit Commitments.
"Total Term Loan A Commitment" means the sum of the amounts of the
Lenders' Term Loan A Commitments.
"Total Term Loan B Commitment" means the sum of the amounts of the
Lenders' Term Loan B Commitments.
"Total Term Loan C Commitment" means the sum of the amounts of the
Lenders' Term Loan C Commitments.
"Trustee" means the United States Trust Company of New York, as
trustee under the Indenture, or its successor.
"Unused Line Fee" has the meaning specified therefor in Section
2.06(c).
"WARN" has the meaning specified therefor in Section 6.01(i).
"WCLDC" means the Washington County Local Development Corporation, a
non-for-profit corporation under the laws of the State of New York.
"WCLDC Loan" means the loan in the original principal amount of
$375,000 made by the WCLDC to the Borrower pursuant to the WCLDC Loan Documents,
of which approximately $42,000 is outstanding on the Effective Date.
"WCLDC Loan Documents" means (i) the Promissory Note dated September
20, 1995 in the amount of $375,000 made by the Borrower payable to the order of
the WCLDC, (ii) the Loan Agreement dated as of September 20, 1995 among the
Parent, the Borrower and the WCLDC, (iii) the Security Agreement dated as of
September 20, 1995 between the Borrower and the WCLDC, (iv) the Unconditional
Guaranty Agreement dated as of September 20, 1995 made by the Parent in favor of
the WCLDC, and (v) the Intercreditor Agreement dated as of September 20, 1995
between the WCLDC and the Existing Lender, as in effect on the date hereof.
SECTION 1.02. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word
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"shall". Unless the context requires otherwise, (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights. References in this Agreement to "determination" by any Agent
include good faith estimates by such Agent (in the case of quantitative
determinations) and good faith beliefs by such Agent (in the case of qualitative
determinations).
SECTION 1.03. Accounting and Other Terms. Unless otherwise expressly
provided herein, each accounting term used herein shall have the meaning given
it under GAAP applied on a basis consistent with those used in preparing the
Financial Statements. All terms used in this Agreement which are defined in
Article 8 or Article 9 of the Uniform Commercial Code in effect in the State of
New York on the date hereof and which are not otherwise defined herein shall
have the same meanings herein as set forth therein.
SECTION 1.04. Time References. Unless otherwise indicated herein,
all references to time of day refer to Eastern standard time or Eastern daylight
saving time, as in effect in New York City on such day. For purposes of the
computation of a period of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding"; provided, however, that with respect to a computation
of fees or interest payable to any Agent, any Lender or the L/C Issuer, such
period shall in any event consist of at least one full day.
ARTICLE II
THE LOANS
SECTION 2.01. Commitments.
(a) Subject to the terms and conditions and relying upon the
representations and warranties herein set forth, each Lender:
(i) severally agrees to make Revolving Loans to the Borrower
at any time and from time to time from the Effective Date to the Final
Maturity Date, or until the earlier reduction of its Revolving Credit
Commitment to zero in accordance with the terms hereof, in an aggregate
principal amount of Revolving Loans at any time outstanding not to
exceed the amount of such Lender's Revolving Credit Commitment;
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(ii) agrees to make a Term Loan A to the Borrower on the
Effective Date, in an aggregate principal amount not to exceed the
amount of such Lender's Term Loan A Commitment;
(iii) agrees to make a Term Loan B to the Borrower on the
Effective Date, in an aggregate principal amount not to exceed the
amount of such Lender's Term Loan B Commitment; and
(iv) upon the simultaneous (A) cancellation of the Support
Letter of Credit or (B) drawing in full under the Support Letter of
Credit, agrees to make a Term Loan C to the Borrower on the Term Loan C
Effective Date in an aggregate principal amount not to exceed the amount
of such Lender's Term Loan C Commitment, which, in the case of subclause
(B) of this clause (iii), shall repay in full the Reimbursement
Obligations of the Borrower arising from the drawing of the Support
Letter of Credit.
(b) Notwithstanding the foregoing, the aggregate principal
amount of Revolving Loans outstanding at any time to the Borrower shall not
exceed the lower of (i) the difference between (A) the Total Revolving Credit
Commitment and (B) the aggregate Adjusted Letter of Credit Obligations and (ii)
the difference between (A) the then current Borrowing Base and (B) the aggregate
Adjusted Letter of Credit Obligations. The Revolving Credit Commitment of each
Lender shall automatically and permanently be reduced to zero on the Final
Maturity Date. Within the foregoing limits, the Borrower may borrow, repay and
reborrow, on or after the Effective Date and prior to the Final Maturity Date,
subject to the terms, provisions and limitations set forth herein.
(c) Notwithstanding the foregoing (i) the aggregate principal
amount of the Term Loans A made on the Effective Date shall not exceed the Total
Term Loan A Commitment, (ii) the aggregate principal amount of the Term Loans B
made on the Effective Date shall not exceed the Total Term Loan B Commitment,
and (iii) the aggregate principal amount of the Term Loans C made on the Term
Loan C Effective Date shall not exceed the least of (A) the Total Term Loan C
Commitment, (B) the XXX Payment Amount, and (C) the maximum principal amount of
Indebtedness permitted to be incurred by the Borrower under the Indenture as a
Permitted Refinancing (as defined in the Indenture) of the Indebtedness under
the Fleet Documents and the XXX Indenture Documents. Any principal amount of a
Term Loan which is repaid or prepaid may not be reborrowed.
SECTION 2.02. Making the Loans. (a) The Borrower shall give the
Administrative Agent prior telephone notice (immediately confirmed in writing,
in substantially the form of Exhibit H hereto (a "Notice of Borrowing"), not
later than 12:00 noon (New York City time) on the date of the proposed Loan.
Such Notice of Borrowing shall be irrevocable and shall specify (i) the
principal amount of the proposed Loan, (ii) in the case of Loans requested on
the Effective Date and on the Term Loan C Effective Date, whether such Loan is
requested to be a Revolving Loan or a Term Loan, (iii) if requested by the
Administrative Agent, the use of the proceeds of such proposed Loan, (iv) the
proposed borrowing date, which must be a Business Day,
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and, with respect to the Term Loan A and the Term Loan B, must be the Effective
Date and with respect to the Term Loan C, must be the Term Loan C Effective
Date, and (v) in the case of Revolving Loans, a Borrowing Base Certificate
current as of the close of business on the immediately preceding day and
otherwise complying with the conditions of Section 7.01(a)(vi), supported by a
schedule showing the derivation thereof. The Administrative Agent and the
Lenders may act without liability upon the basis of written, telecopied or
telephonic notice believed by the Administrative Agent in good faith to be from
the Borrower (or from any Authorized Officer thereof designated in writing
purportedly from the Borrower to the Administrative Agent) in the absence of
gross negligence or willful misconduct on the part of the Administrative Agent
as determined by a final judgment of a court of competent jurisdiction. The
Borrower hereby waives the right to dispute the Administrative Agent's record of
the terms of any such telephonic Notice of Borrowing. The Administrative Agent
and each Lender shall be entitled to rely conclusively on any Authorized
Officer's authority to request a Loan on behalf of the Borrower until the
Administrative Agent receives written notice to the contrary. The Administrative
Agent and the Lenders shall have no duty to verify the authenticity of the
signature appearing on any written Notice of Borrowing. Except as otherwise
provided in this Section 2.02, Loans shall be made ratably by the Lenders in
accordance with their respective Revolving Credit Commitments, Term Loan A
Commitments, Term Loan B Commitments and Term Loan C Commitments, as the case
may be.
(b) Each Notice of Borrowing pursuant to this Section 2.02 shall
be irrevocable and the Borrower shall be bound to make a borrowing in accordance
therewith. Each Revolving Loan shall be made in a minimum amount of $50,000 and
shall be in an integral multiple of $25,000.
(c) (i) Except as otherwise provided in this subsection 2.02(c),
all Loans under this Agreement shall be made by the Lenders simultaneously and
proportionately to their Pro Rata Shares of the Total Revolving Credit
Commitment, the Total Term Loan A Commitment, the Total Term Loan B Commitment
and the Total Term Loan C Commitment, as the case may be, it being understood
that no Lender shall be responsible for any default by any other Lender in that
other Lender's obligations to make a Loan requested hereunder, nor shall the
Commitment of any Lender be increased or decreased as a result of the default by
any other Lender in that other Lender's obligation to make a Loan requested
hereunder, and each Lender shall be obligated to make the Loans required to be
made by it by the terms of this Agreement regardless of the failure by any other
Lender.
(ii) Notwithstanding any other provision of this Agreement,
and in order to reduce the number of fund transfers among the Borrower, the
Agents and the Lenders, the Borrower, the Agents and the Lenders agree that the
Administrative Agent may (but shall not be obligated to), and the Borrower and
the Lenders hereby irrevocably authorize the Administrative Agent to, fund, on
behalf of the Lenders, Revolving Loans pursuant to Section 2.01, subject to the
procedures for settlement set forth in subsection 2.02(d); provided, however,
that (a) the Administrative Agent shall in no event fund such Loans if the
Administrative Agent shall have received written notice from the Required
Lenders on the Business Day prior to the day of the proposed Loan that one or
more of the conditions precedent contained in Section 5.02 will not be
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satisfied on the day of the proposed Loan, and (b) the Administrative Agent
shall not otherwise be required to determine that, or take notice whether, the
conditions precedent in Section 5.02 have been satisfied. If the Borrower gives
a Notice of Borrowing requesting a Revolving Loan and the Administrative Agent
elects not to fund such Loan on behalf of the Lenders, then promptly after
receipt of the Notice of Borrowing requesting such Loan, the Administrative
Agent shall notify each Lender of the specifics of the requested Loan and that
it will not fund the requested Loan on behalf of the Lenders. If the
Administrative Agent notifies the Lenders that it will not fund a requested
Revolving Loan on behalf of the Lenders, each Lender shall make its Pro Rata
Share of the Loan available to the Administrative Agent, in immediately
available funds, at the Payment Office no later than 3:00 p.m. (New York City
time) (provided that the Administrative Agent requests payment from such Lender
not later than 1:00 p.m.) on the date of the proposed Loan. The Administrative
Agent will make the proceeds of such Loans available to the Borrower on the day
of the proposed Loan by causing an amount, in immediately available funds, equal
to the proceeds of all such Loans received by the Administrative Agent at the
Payment Office or the amount funded by the Administrative Agent on behalf of the
Lenders to be deposited in an account designated by the Borrower.
(iii) If the Administrative Agent has notified the Lenders
that the Administrative Agent, on behalf of the Lenders, will fund a particular
Loan pursuant to subsection 2.02(c)(ii), the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent on
such day and the Administrative Agent, in its sole discretion, may, but shall
not be obligated to, cause a corresponding amount to be made available to the
Borrower on such day. If the Administrative Agent makes such corresponding
amount available to the Borrower and such corresponding amount is not in fact
made available to the Administrative Agent by such Lender, the Administrative
Agent shall be entitled to recover such corresponding amount on demand from such
Lender together with interest thereon, for each day from the date such payment
was due until the date such amount is paid to the Administrative Agent, at the
Federal Funds Rate for three Business Days and thereafter at the Reference Rate.
During the period in which such Lender has not paid such corresponding amount to
the Administrative Agent, notwithstanding anything to the contrary contained in
this Agreement or any other Loan Document, the amount so advanced by the
Administrative Agent to the Borrower shall, for all purposes hereof, be a
Revolving Loan made by the Administrative Agent for its own account. Upon any
such failure by a Lender to pay the Administrative Agent, the Administrative
Agent shall promptly thereafter notify the Borrower of such failure and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent for its own account.
(iv) Nothing in this subsection 2.02(c) shall be deemed to
relieve any Lender from its obligations to fulfill its Revolving Credit
Commitments hereunder or to prejudice any rights that the Administrative Agent
or the Borrower may have against any Lender as a result of any default by such
Lender hereunder.
(d) (i) With respect to all periods for which the Administrative
Agent has funded Loans pursuant to subsection 2.02(c), on Friday of each week,
or if the applicable Friday is not a Business Day, then on the following
Business Day, or such shorter period as the Administrative Agent may from time
to time select (any such week or shorter period being herein
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called a "Settlement Period"), the Administrative Agent shall notify each Lender
of the unpaid principal amount of the Revolving Loans outstanding as of the last
day of each such Settlement Period. In the event that such amount is greater
than the unpaid principal amount of the Revolving Loans outstanding on the last
day of the Settlement Period immediately preceding such Settlement Period (or,
if there has been no preceding Settlement Period, the amount of the Revolving
Loans made on the date of such Lender's initial funding), each Lender shall
promptly (and in any event not later than 2:00 p.m. if the Administrative Agent
requests payment from such Lender not later than 12:00 noon on such day) make
available to the Administrative Agent its Pro Rata Share of the difference in
immediately available funds. In the event that such amount is less than such
unpaid principal amount, the Administrative Agent shall promptly pay over to
each Lender its Pro Rata Share of the difference in immediately available funds.
In addition, if the Administrative Agent shall so request at any time when a
Default or an Event of Default shall have occurred and be continuing, or any
other event shall have occurred as a result of which the Administrative Agent
shall determine that it is desirable to present claims against the Borrower for
repayment, each Lender shall promptly remit to the Administrative Agent or, as
the case may be, the Administrative Agent shall promptly remit to each Lender,
sufficient funds to adjust the interests of the Lenders in the then outstanding
Revolving Loans to such an extent that, after giving effect to such adjustment,
each Lender's interest in the then outstanding Revolving Loans will be equal to
its Pro Rata Share thereof. The obligations of the Administrative Agent and each
Lender under this subsection 2.02(d) shall be absolute and unconditional. Each
Lender shall only be entitled to receive interest on its Pro Rata Share of the
Revolving Loans which have been funded by such Lender.
(ii) In the event that any Lender fails to make any payment
required to be made by it pursuant to subsection 2.02(d)(i), the Administrative
Agent shall be entitled to recover such corresponding amount on demand from such
Lender together with interest thereon, for each day from the date such payment
was due until the date such amount is paid to the Administrative Agent, at the
Federal Funds Rate for three Business Days and thereafter at the Reference Rate.
During the period in which such Lender has not paid such corresponding amount to
the Administrative Agent, notwithstanding anything to the contrary contained in
this Agreement or any other Loan Document, the amount so advanced by the
Administrative Agent to the Borrower shall, for all purposes hereof, be a
Revolving Loan made by the Administrative Agent for its own account. Upon any
such failure by a Lender to pay the Administrative Agent, the Administrative
Agent shall promptly thereafter notify the Borrower of such failure and the
Borrower shall immediately pay such corresponding amount to the Administrative
Agent for its own account. Nothing in this subsection 2.02(d)(ii) shall be
deemed to relieve any Lender from its obligation to fulfill its Revolving Credit
Commitments hereunder or to prejudice any rights that the Administrative Agent
or the Borrower may have against any Lender as a result of any default by such
Lender hereunder.
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SECTION 2.03. Notes; Repayment of Loans. (a) The Term Loan A made by
a Lender shall be evidenced by a single Term A Note, duly executed on behalf of
the Borrower, dated the Effective Date, and delivered to and made payable to the
order of such Lender in a principal amount equal to the amount of such Lender's
Term Loan A Commitment. The Term Loan B made by a Lender shall be evidenced by a
single Term B Note, duly executed on behalf of the Borrower, dated the Effective
Date, and delivered to and made payable to the order of such Lender in a
principal amount equal to the amount of such Lender's Term Loan B Commitment.
The Term Loan C made by a Lender shall be evidenced by a single Term C Note,
duly executed on behalf of the Borrower, dated the Term Loan C Effective Date,
and delivered to and made payable to the order of such Lender in a principal
amount equal to the amount of such Lender's Term Loan C Commitment. All
Revolving Loans made by a Lender to the Borrower shall be evidenced by a single
Revolving Credit Note, duly executed on behalf of the Borrower, dated the
Effective Date, and delivered to and made payable to the order of such Lender in
a principal amount equal to the amount of such Lender's Revolving Credit
Commitment.
(b) The Term Loan A shall be repayable in 5 consecutive
quarterly installments, on the last day of each January, April, July and October
commencing on April 30, 2001 and ending on the Final Maturity Date, consisting
of (i) four (4) installments, each in an amount equal to $400,000, followed by
(ii) one (1) installment, in the amount equal to $7,150,000; provided, however,
that the last such installment shall be in the amount necessary to repay in full
the unpaid principal amount of the Term Loan A.
(c) The Term Loan B shall be repaid in full on the Final
Maturity Date.
(d) The Term Loan C shall be repaid in two installments, on
September 30, 2003 and on November 13, 2004, consisting of (i) one (1)
installment, in the amount equal to $1,999,900 and (ii) one (1) installment, in
the amount equal to $100; provided, however, that the last such installment
shall be in the amount necessary to repay in full the unpaid principal amount of
the Term Loan C.
(e) The outstanding principal of all Revolving Loans shall be
due and payable on the Final Maturity Date.
(f) The Borrower agrees to record each Loan on the Register
referred to in Section 12.07(b). Each Loan recorded on the Register (the
"Registered Loan") may not be evidenced by promissory notes other than a Term A
Note, a Term B Note, a Term C Note or a Revolving Credit Note, each of which is
a Registered Note (as defined below). Upon the registration of any Loan, any
promissory note (other than a Registered Note) evidencing the same shall be null
and void and shall be returned to the Borrower. The Borrower agrees, at the
request of any Lender, to execute and deliver to such Lender a promissory note
in registered form to evidence such Registered Loan (i.e. containing the
registered note language set forth in Exhibits X-0, X-0, X-0 and B hereto) and
registered as provided in Section 12.07(b) (a "Registered Note"), dated the date
hereof, payable to such Lender and otherwise duly completed. Once recorded on
the Register, the Loan or Loans evidenced by such Note may not be removed
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from the Register so long as it remains outstanding, and a Registered Note may
not be exchanged for a promissory note that is not a Registered Note.
SECTION 2.04. Interest.
(a) Term Loans. Each Term Loan shall bear interest on the
principal amount thereof from time to time outstanding, from the date of such
Loan until such principal amount becomes due, at a rate per annum equal to the
greater of (i) the Reference Rate plus 3.00% and (ii) 12.00%, provided, that,
the interest rate per annum on each Term Loan C shall be increased by 5% on the
first day of each month, commencing with the first month after the Final
Maturity Date.
(b) Revolving Loans. Each Revolving Loan shall bear interest on
the principal amount thereof from time to time outstanding, from the date of
such Loan until such principal amount becomes due, at a rate per annum equal to
the greater of (i) the Reference Rate plus 2.00% and (ii) 11.00%.
(c) Default Interest. To the extent permitted by law, upon the
occurrence and during the continuance of an Event of Default, the principal of,
and all accrued and unpaid interest on, all Loans, and all fees, indemnities,
outstanding Reimbursement Obligations or any other Obligations of the Borrower
under this Agreement, the Notes and other Loan Documents shall bear interest,
from the date such Event of Default occurred until such Event of Default is
cured or waived in writing in accordance herewith, at a rate per annum equal at
all times to the Post-Default Rate.
(d) Interest Payment. Interest on each Loan shall be payable
monthly, in arrears, on the first day of each month, commencing on the first day
of the month following the month in which such Loan is made and at maturity
(whether upon demand, by acceleration or otherwise). Interest at the
Post-Default Rate shall be payable on demand. The Borrower hereby authorizes the
Administrative Agent to, and the Administrative Agent may, from time to time,
charge the Loan Account pursuant to Section 4.02 with the amount of any interest
payment due hereunder.
(e) General. All interest shall be computed on the basis of a
year of 360 days for the actual number of days, including the first day but
excluding the last day, elapsed.
SECTION 2.05. Reduction of Commitment; Prepayment of Loans.
(a) Reduction of Commitments.
(i) Revolving Credit Commitments. The Total Revolving Credit
Commitment shall terminate on the Final Maturity Date. The Borrower may, without
premium or penalty, reduce the Total Revolving Credit Commitment to an amount
(which may be zero) not less than the sum of (A) the aggregate unpaid principal
amount of all Revolving Loans then outstanding, (B) the aggregate principal
amount of all Revolving Loans not yet made as to which a Notice of Borrowing has
been given by the Borrower under Section 2.02, and (C) the
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Letter of Credit Obligations at such time. Each such reduction shall be in an
amount which is an integral multiple of $1,000,000, (unless the Total Revolving
Credit Commitment in effect immediately prior to such reduction is less than
$1,000,000) shall be made by providing not less than three Business Days' prior
written notice to the Administrative Agent and shall be irrevocable. Once
reduced the Total Revolving Credit Commitment may not be increased. Each such
reduction of the Total Revolving Credit Commitment shall reduce the Revolving
Credit Commitment of each Lender proportionately in accordance with its Pro Rata
Share thereof.
(ii) Term Loans. The Total Term Loan A Commitment and the
Total Term Loan B Commitment shall terminate at 5:00 p.m. (New York City time)
on the Effective Date. The Total Term Loan C Commitment shall terminate at 5:00
p.m. (New York City time) on July 6, 2000.
(b) Optional Prepayment.
(i) Revolving Loans. The Borrower may prepay without penalty
or premium the principal of any Revolving Loan, in whole or in part.
(ii) Term Loans. The Borrower may, upon at least three (3)
Business Days' prior written notice to the Administrative Agent, prepay without
penalty the principal of any Term Loan, in whole or in part. Each prepayment
made pursuant to this clause (b)(ii) shall be accompanied by the payment of
accrued interest to the date of such payment on the amount prepaid and shall be
made without penalty or premium. Each prepayment shall be applied, first, to the
Term Loan A, second, to the Term Loan B and, third, to the Term Loan C, in each
case, against the remaining installments of principal due on such Term Loan in
the inverse order of maturity.
(c) Mandatory Prepayment.
(i) The Borrower will immediately prepay the Revolving Loans
at any time when the aggregate principal amount of all Revolving Loans plus the
outstanding amounts of all Letter of Credit Obligations exceeds the Borrowing
Base, to the full extent of any such excess. On each day that any Revolving
Loans or Letter of Credit Obligations are outstanding, the Borrower shall hereby
be deemed to represent and warrant to the Agents and the Lenders that the
Borrowing Base calculated as of such day equals or exceeds the aggregate
principal amount of all Revolving Loans and Letter of Credit Obligations
outstanding on such day. If at any time after the Borrower has complied with the
first sentence of this Section 2.05(c), the aggregate Letter of Credit
Obligations is greater than the then current Borrowing Base, the Borrower shall
provide cash collateral to the Administrative Agent in the amount of such
excess, which cash collateral shall be deposited in an interest bearing account
maintained by the Administrative Agent and, provided that no Event of Default
shall have occurred and be continuing, returned to the Borrower, at such time as
the aggregate Letter of Credit Obligations plus the aggregate principal amount
of all outstanding Revolving Loans no longer exceeds the then current Borrowing
Base.
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(ii) The Borrower will immediately prepay the outstanding
principal amount of the Term Loans in the event that the Total Revolving Credit
Commitment is terminated for any reason, including the termination of the Total
Revolving Credit Commitment on the Final Maturity Date, unless the Total
Revolving Credit Commitment terminates on the Final Maturity Date and the
Borrower obtains a new revolving credit facility in an amount, from a lender and
on such other terms and conditions (including, without limitation, an
intercreditor arrangement between the lender providing such revolving credit
facility and the Collateral Agent) as are acceptable to the Collateral Agent in
its sole discretion, in which case, any Term Loans not required to be paid
pursuant to other provisions of this Agreement may remain outstanding.
(iii) The Administrative Agent shall on each Business Day
apply all funds transferred to or deposited in the Payment Office, to the
payment, in whole or in part, of the outstanding Revolving Loans.
(iv) Within ten (10) days of delivery to the Agents and the
Lenders of audited annual financial statements pursuant to Section 7.01(a)(ii),
commencing with the delivery to the Agents and the Lenders of the financial
statements for the Fiscal Year ended March 31, 2001 or, if such financial
statements are not delivered to the Agents and the Lenders on the date such
statements are required to be delivered pursuant to such Section 7.01(a)(ii),
ten (10) days after the date such statements are required to be delivered to the
Agents and the Lenders pursuant to Section 7.01(a)(ii), the Borrower shall
prepay the outstanding principal of the Term Loans in an amount equal to 50% of
the Excess Cash Flow of the Borrower for such Fiscal Year.
(v) Dispositions; Casualty Events. Immediately upon any
Disposition by the Borrower or any Loan Party pursuant to Section 7.02(c)(ii),
other than any Disposition of any asset in which the Trustee has been granted a
Lien to secure the Senior Secured Notes, the Borrower shall prepay the
outstanding principal of the Term Loans in an amount equal to 100% of the Net
Cash Proceeds received by the Borrower or any Loan Party in connection with such
Disposition to the extent that the aggregate amount of Net Cash Proceeds
received by the Borrower or any Loan Party (and not paid to the Administrative
Agent as a prepayment of the Term Loans) shall exceed for all such Dispositions
since the Effective Date $50,000. Upon the loss, destruction or taking by
condemnation of any Collateral, the Borrower shall prepay the outstanding
principal of the Term Loans (or, to the extent such loss or destruction is with
respect to Inventory, the Revolving Loans) in an amount equal to 100% of the
proceeds received by the Borrower or any Loan Party in connection therewith, net
of any reasonable expenses incurred in collecting such net proceeds.
(vi) Upon the issuance or incurrence by the Borrower of any
Indebtedness except as permitted by Section 7.02(b), or the sale or issuance by
the Borrower or any Loan Party of any shares of its Capital Stock, the Borrower
shall prepay the outstanding amount of the Term Loans in an amount equal to 100%
of the Net Cash Proceeds received by the Borrower or any Loan Party in
connection therewith. The provisions of this subsection (c) shall not be deemed
to be implied consent to any such issuance, incurrence or sale otherwise
prohibited by the terms and conditions hereof.
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(vii) Upon receipt by any Loan Party of the proceeds of a
judgment, award, settlement or other similar payment with respect to the
Rubbermaid Proceedings, the Borrower shall prepay the outstanding principal
amount of the Term Loans (or if the Term Loans have been paid in full, the
Revolving Loans) in an amount equal to the first $5,000,000 of such judgment,
award, settlement or other similar payment.
(d) Application of Payments. Subject to Section 4.04(f) hereof,
each prepayment of the Term Loans pursuant to subsections (c)(v), (c)(vi) and
(c)(vii) above shall be applied, first, to the Term Loan A, second, to the Term
Loan B, and third, to the Term Loan C. Each such prepayment of the Term Loans
shall be applied against the remaining installments of principal of the Term
Loans in the inverse order of maturity.
(e) Interest and Fees. Any prepayment made pursuant to this
Section 2.05 (other than payments pursuant to subsections (c)(i) and (c)(iii) of
this Section 2.05) shall be accompanied by accrued interest on the principal
amount being prepaid to the date of prepayment, and if such prepayment would
reduce the amount of the outstanding Loans to zero at a time when the Revolving
Credit Commitment has been terminated, such prepayment shall be accompanied by
the payment of the fees accrued to such date pursuant to Section 2.06.
(f) Cumulative Prepayments. Except as otherwise expressly
provided in this Section 2.05, payments with respect to any subsection of this
Section 2.05 are in addition to payments made or required to be made under any
other subsection of this Section 2.05.
SECTION 2.06. Fees.
(a) Closing Fee. On or prior to the Effective Date, the Borrower
shall pay to the Administrative Agent for the account of the Lenders in
accordance with a written agreement among such Lenders a non-refundable closing
fee (the "Closing Fee") equal to $270,000 which shall be deemed fully earned
when paid.
(b) Commitment Fee. On or prior to the Effective Date, the
Borrower shall pay to the Administrative Agent for the account of the Lenders in
accordance with a written agreement among such Lenders a non-refundable
commitment fee (the "Commitment Fee") equal to $270,000, which shall be deemed
fully earned when paid.
(c) Unused Line Fee. From and after the Effective Date and until
the Final Maturity Date, the Borrower shall pay to the Administrative Agent for
the account of the Lenders in accordance with a written agreement among such
Lenders an unused line fee (the "Unused Line Fee"), which shall accrue at the
rate per annum of 0.5% on the excess, if any, of the Total Revolving Credit
Commitment over the sum of the average principal amount of Revolving Loans and
Letter of Credit Obligations outstanding from time to time and shall be payable
monthly in arrears on the first day of each month commencing June 1, 2000.
(d) Loan Servicing Fee. From and after the Effective Date and
until the Final Maturity Date, the Borrower shall pay to the Administrative
Agent for the account of the Agents in accordance with a written agreement
between such Agents a non-refundable loan
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servicing fee (the "Loan Servicing Fee") equal to $25,000 each quarter, payable
on the Effective Date and quarterly in advance thereafter on the first day of
each calendar quarter commencing on July 1, 2000.
(e) Anniversary Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders in accordance with a written
agreement between such Lenders an anniversary fee (the "Anniversary Fee") equal
to 1% of the average principal amount of the Loans outstanding during the
previous twelve (12) months, payable on the first anniversary of the Effective
Date.
SECTION 2.07. Securitization. The Borrower hereby acknowledges that
the Lenders and any of their Affiliates may sell or securitize the Loans (a
"Securitization") through the pledge of the Loans as collateral security for
loans to the Lenders or their Affiliates or through the sale of the Loans or the
issuance of direct or indirect interests in the Loans, which loans to the
Lenders or their Affiliates or direct or indirect interests will be rated by
Xxxxx'x, Standard & Poor's or one or more other rating agencies (the "Rating
Agencies"). The Borrower shall cooperate with the Lenders and their Affiliates
to effect the Securitization including, without limitation, by (a) amending this
Agreement and the other Loan Documents, and executing such additional documents,
as reasonably requested by the Lenders in connection with the Securitization,
provided that (i) any such amendment or additional documentation does not impose
material additional costs on the Borrower and (ii) any such amendment or
additional documentation does not materially adversely affect the rights, or
materially increase the obligations, of the Borrower under the Loan Documents or
change or affect in a manner adverse to the Borrower the financial terms of the
Loans, (b) providing such information as may be reasonably requested by the
Lenders in connection with the rating of the Loans or the Securitization, and
(c) providing in connection with any rating of the Loans a certificate (i)
agreeing to indemnify the Lenders and any of their Affiliates, any of the Rating
Agencies, or any party providing credit support or otherwise participating in
the Securitization (collectively, the "Securitization Parties") for any losses,
claims, damages or liabilities (the "Liabilities") to which the Lenders, their
Affiliates or such Securitization Parties may become subject insofar as the
Liabilities arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any Loan Document or in any
writing delivered by or on behalf of the Borrower and its Affiliates to the
Lenders in connection with any Loan Document or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein, or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading and such
indemnity shall survive any transfer by the Lenders or their successors or
assigns of the Loans and (ii) agreeing to reimburse the Lenders and any of their
Affiliates for any legal or other expenses reasonably incurred by such Persons
in connection with defending the Liabilities.
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ARTICLE III
SUPPORT LETTER OF CREDIT
SECTION 3.01. Letter of Credit Guaranty.
(a) In order to assist the Borrower in establishing or opening a
standby letter of credit in the stated amount of the L/C Subfacility, to be
issued by the L/C Issuer on the Effective Date in favor of the Existing Lender
in order to provide for payment of all reimbursement and other payment
obligations of the Borrower with respect to the Fleet Letter of Credit, the
Borrower has requested the Administrative Agent to join in the application for
such letter of credit (the "Support Letter of Credit"), and/or guarantee payment
or performance of the Support Letter of Credit and any drafts thereunder through
the issuance of a Letter of Credit Guaranty, thereby lending the Administrative
Agent's credit to that of the Borrower, and the Administrative Agent has agreed
to do so. These arrangements shall be coordinated by the Administrative Agent
subject to the terms and conditions set forth below. The Administrative Agent
shall not be required to be the issuer of the Support Letter of Credit. The
Borrower will be the account party for the application for the Support Letter of
Credit, which shall be substantially in the form of Exhibit K hereto or on a
computer transmission system approved by the Administrative Agent and the L/C
Issuer or such other written form or computer transmission system as may be
approved by the L/C Issuer and the Administrative Agent, and shall be duly
completed in a manner reasonably acceptable to the Administrative Agent,
together with such other certificates, agreements, documents and other papers
and information as the L/C Issuer or the Administrative Agent may reasonably
request (the "Letter of Credit Application"). In the event of any conflict
between the terms of the Letter of Credit Application and this Agreement, for
purposes of this Agreement, the terms of this Agreement shall control.
(b) The terms and conditions of the Support Letter of Credit and
all changes or modifications thereof by the Borrower and/or the L/C Issuer shall
in all respects be subject to the prior approval of the Administrative Agent in
the reasonable exercise of its sole and absolute discretion, provided, however,
that the Support Letter of Credit and all documentation in connection therewith
shall be in form and substance reasonably satisfactory to the Administrative
Agent and the L/C Issuer.
(c) The Administrative Agent shall have the right, without
notice to the Borrower, to charge the Loan Account with the amount of any and
all indebtedness, liabilities and obligations of any kind (including
indemnification for breakage costs, capital adequacy and reserve requirement
charges) incurred by the Agents or the Lenders under the Letter of Credit
Guaranty or incurred by an L/C Issuer with respect to the Support Letter of
Credit at the earlier of (i) payment by the Administrative Agent or the Lenders
under the Letter of Credit Guaranty or (ii) the occurrence of an Event of
Default. Any amount charged to the Loan Account shall be deemed a Revolving Loan
hereunder made by the Lenders to the Borrower, funded by the Administrative
Agent on behalf of the Lenders and subject to Section 2.02 of this Agreement.
Any charges, fees, commissions, costs and expenses charged to the Administrative
Agent for the Borrower's account by the L/C Issuer in connection with or arising
out of the Support Letter of
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Credit or transactions relating thereto will be charged to the Loan Account in
full when charged to or paid by the Administrative Agent and, when charged,
shall be conclusive on the Borrower absent manifest error. Each of the Lenders
and the Borrower agrees that the Administrative Agent shall have the right to
make such charges regardless of whether any Event of Default or Default shall
have occurred and be continuing or whether any of the conditions precedent in
Section 5.02 have been satisfied.
(d) The Borrower unconditionally indemnifies each Agent and each
Lender and holds each Agent and each Lender harmless from any and all loss,
claim or liability incurred by any Agent or any Lender arising from any
transactions or occurrences relating to the Support Letter of Credit, any drafts
or acceptances thereunder, the Collateral relating thereto, and all Obligations
in respect thereof, including any such loss or claim due to any action taken by
the L/C Issuer, other than for any such loss, claim or liability arising out of
the gross negligence or willful misconduct of the L/C Issuer, any Agent or any
Lender as determined by a final judgment of a court of competent jurisdiction.
The Borrower further agrees to jointly and severally hold each Agent and each
Lender harmless from any errors or omission, negligence or misconduct by the L/C
Issuer. The Borrower's unconditional obligations to each Agent, the L/C Issuer
and each Lender with respect to the Support Letter of Credit hereunder shall not
be modified or diminished for any reason or in any manner whatsoever, other than
as a result of such Agent's, the L/C Issuer's or such Lender's gross negligence
or willful misconduct as determined by a final judgment of a court of competent
jurisdiction. The Borrower agrees that any charges incurred by the
Administrative Agent or the L/C Issuer for the Borrower's account hereunder may
be charged to the Loan Account.
(e) Upon any payments made to the L/C Issuer under the Letter of
Credit Guaranty, the Agents or the Lenders, as the case may be, shall, without
prejudice to its rights under this Agreement (including that such unreimbursed
amounts shall constitute Loans hereunder), acquire by subrogation, any rights,
remedies, duties or obligations granted or undertaken by the Borrower in favor
of the L/C Issuer in any application for the Support Letter of Credit, any
standing agreement relating to the Support Letter of Credit or otherwise, all of
which shall be deemed to have been granted to the Agents and the Lenders and
apply in all respects to the Agents and the Lenders and shall be in addition to
any rights, remedies, duties or obligations contained herein.
SECTION 3.02. Participations.
(a) Purchase of Participations. Immediately upon issuance by the
L/C Issuer of the Support Letter of Credit pursuant to this Agreement, each
Lender shall be deemed to have irrevocably and unconditionally purchased and
received from the Administrative Agent, without recourse or warranty, an
undivided interest and participation, to the extent of such Lender's Pro Rata
Share, in all obligations of the Administrative Agent in the Support Letter of
Credit (including, without limitation, all Reimbursement Obligations of the
Borrower with respect thereto pursuant to the Letter of Credit Guaranty or
otherwise).
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(b) Sharing of Payments. In the event that the Administrative
Agent makes any payment in respect of the Letter of Credit Guaranty and the
Borrower shall not have repaid such amount to the Administrative Agent, the
Administrative Agent shall charge the Loan Account in the amount of the
Reimbursement Obligation, in accordance with Sections 3.01(c) and 4.02 of this
Agreement.
(c) Obligations Irrevocable. The obligations of a Lender to make
payments to the Administrative Agent for the account of the Agents, the Lenders
or the L/C Issuer with respect to the Support Letter of Credit shall be
irrevocable, without any qualification or exception whatsoever and shall be made
in accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against a beneficiary named in the
Support Letter of Credit or any transferee of the Support Letter of Credit (or
any Person for whom any such transferee may be acting), any Agent, any Lender,
or any other Person, whether in connection with this Agreement, the Support
Letter of Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transactions between the Borrower or any
other party and the beneficiary named in the Support Letter of Credit);
(iii) any draft, certificate or any other document presented
under the Support Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan Documents;
(v) any failure by any Agent to provide any notices required
pursuant to this Agreement relating to the Support Letter of Credit;
(vi) any payment by the L/C Issuer under the Support Letter
of Credit against presentation of a draft or certificate which does not comply
with the terms of the Support Letter of Credit; or
(vii) the occurrence of any Default or Event of Default.
SECTION 3.03. Support Letter of Credit.
(a) Request for Issuance. The Borrower may, upon notice not
later than 12:00 noon, New York City time, at least two Business Days in advance
of the Effective Date, request the Administrative Agent to assist the Borrower
in establishing or opening the
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Support Letter of Credit by delivering to the Administrative Agent, with a copy
to the L/C Issuer, a Letter of Credit Application, together with any necessary
related documents.
(b) Letter of Credit Fees. (i) The Borrower shall pay to the
Administrative Agent for the account of the Lenders with a Revolving Credit
Commitment, in accordance with the Lenders' Pro Rata Shares, a nonrefundable fee
equal to 3% per annum of the stated amount of the Support Letter of Credit,
payable on the date the Support Letter of Credit is issued.
(ii) L/C Issuer Charges. The Borrower shall pay to the
Administrative Agent the standard charges assessed by the L/C Issuer in
connection with the issuance, administration, amendment, payment or cancellation
of the Support Letter of Credit.
(iii) Charges to the Loan Account. The Borrower hereby
authorizes the Administrative Agent to, and the Administrative Agent may, from
time to time, charge the Loan Account pursuant to Sections 3.01(c) and 4.02 of
this Agreement with the amount of any Support Letter of Credit fees or charges
due under this Section 3.03.
ARTICLE IV
FEES, PAYMENTS AND OTHER COMPENSATION
SECTION 4.01. Audit and Collateral Monitoring Fees. The Borrower
acknowledges that the Agents may visit the Borrower and the Guarantors and/or
conduct audits, inspectors and/or field examinations of the Borrower and the
Guarantors at any time and from time to time in a manner so as to not unduly
disrupt the business of the Borrower and the Guarantors. The Borrower agrees to
pay $750 per day per examiner plus the examiner's out-of-pocket costs and
reasonable expenses incurred in connection with all such visits, inspections,
audits and examinations.
SECTION 4.02. Payments; Computations and Statements. (a) The
Borrower will make each payment under the Notes not later than 12:00 noon (New
York City time) on the day when due, in lawful money of the United States of
America and in immediately available funds, to the Administrative Agent at the
Payment Office. All payments received by the Administrative Agent after 12:00
noon (New York City time) on any Business Day will be credited to the Loan
Account on the next succeeding Business Day. All payments shall be made by the
Borrower without defense, set-off or counterclaim to the Agents and the Lenders.
Except as provided in Section 2.02, after receipt, the Administrative Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal ratably to the Lenders in accordance with their Pro Rata Shares and
like funds relating to the payment of any other amount payable to any Lender to
such Lender, in each case to be applied in accordance with the terms of this
Agreement, provided that the Administrative Agent will cause to be distributed
all interest and fees received from or for the account of the Borrower not less
than once each month and in any event promptly after receipt thereof. The
Lenders and the Borrower hereby authorize the Administrative Agent to, and the
Administrative Agent may, from time to time, charge the Loan
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Account of the Borrower with any amount due and payable by the Borrower under
any Loan Document. Each of the Lenders and the Borrower agree that the
Administrative Agent shall have the right to make such charges whether or not
any Event of Default or Default shall have occurred and be continuing or whether
any of the conditions precedent in Section 5.02 have been satisfied. Any amount
charged to the Loan Account of the Borrower shall be deemed a Revolving Loan
hereunder made by the Lenders to the Borrower, funded by the Administrative
Agent on behalf of the Lenders and subject to Section 2.02 of this Agreement.
The Lenders and the Borrower confirm that any charges which the Administrative
Agent may so make to the Loan Account of the Borrower as herein provided will be
made as an accommodation to the Borrower and solely at the Administrative
Agent's discretion, provided that the Administrative Agent shall from time to
time upon the request of the Collateral Agent, charge the Loan Account of the
Borrower with any amount due and payable under any Loan Document. Whenever any
payment to be made under any such Loan Document shall be stated to be due on a
day other than a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall in such case be included in the
computation of interest or fees, as the case may be. All computations of fees
shall be made by the Administrative Agent on the basis of a year of 360 days for
the actual number of days (including the first day but excluding the last day)
occurring in the period for which such fees are payable. Each determination by
the Administrative Agent of an interest rate or fees hereunder shall be
conclusive and binding for all purposes in the absence of manifest error.
(b) The Administrative Agent shall provide the Borrower,
promptly after the end of each calendar month, a summary statement (in the form
from time to time used by the Administrative Agent) of the opening and closing
daily balances in the Loan Account of the Borrower during such month, the
amounts and dates on all Loans made to the Borrower during such month, the
amounts and dates of all payments on account of the Loans to the Borrower during
such month and the Loans to which such payments were applied, the amount of
interest accrued on the Loans to the Borrower during such month, the amount of
charges to such Loan Account and/or Loans made to the Borrower during such month
to reimburse the Lenders for drawings made under the Support Letter of Credit,
and the amount and nature of any charges to such Loan Account made during such
month on account of fees, commissions, expenses and other Obligations. All
entries on any such statement shall, 30 days after the same is sent, be presumed
to be correct and shall be final and conclusive absent manifest error.
SECTION 4.03. Sharing of Payments, Etc. Except as provided in
Section 2.02 hereof, if any Lender shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) on
account of any Obligation in excess of its ratable share of payments on account
of similar obligations obtained by all the Lenders, such Lender shall forthwith
purchase from the other Lenders such participations in such similar obligations
held by them as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's ratable share (according to the
proportion of (i) the amount of such Lender's required repayment to (ii) the
total amount so
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recovered from the purchasing Lender of any interest or other amount paid by the
purchasing Lender in respect of the total amount so recovered). The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 4.03 may, to the fullest extent permitted by law,
exercise all its rights (including the Lender's right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
SECTION 4.04. Apportionment of Payments. (a) Subject to Section 2.02
hereof and to any written agreement among the Agents and the Lenders, all
payments of principal and interest in respect of outstanding Loans, all payments
in respect of the Reimbursement Obligations, all payments of fees (other than
the fees set forth in Sections 2.06 hereof to the extent set forth in such
written agreement among the Agents and the Lenders, fees with respect to the
Support Letter of Credit provided for in Section 3.03(b)(ii) and the audit and
collateral monitoring fee provided for in Section 4.01) and all other payments
in respect of any other Obligations, shall be allocated by the Administrative
Agent among such of the Lenders as are entitled thereto, in proportion to their
respective Pro Rata Shares or otherwise as provided herein or, in respect of
payments not made on account of Loans or Letter of Credit Obligations, as
designated by the Person making payment when the payment is made.
(b) After the occurrence and during the continuance of an Event
of Default, all payments in respect of any Obligations and all proceeds of the
Collateral, shall, unless the Administrative Agent shall otherwise agree, be
applied (i) first, to pay the Obligations in respect of any fees, expense
reimbursements, indemnities and other amounts then due to the Agents or the L/C
Issuer until paid in full; (ii) second, to pay the Revolving Loan Obligations in
respect of any fees and indemnities then due to the Lenders until paid in full;
(iii) third, ratably to pay interest due in respect of the Revolving Loans,
Collateral Agent Advances and Reimbursement Obligations until paid in full; (iv)
fourth, ratably to pay principal of the Revolving Loans, Collateral Agent
Advances and Letter of Credit Obligations (or, to the extent such Obligations
are contingent, to provide cash collateral in respect of such Obligations) until
paid in full; (v) fifth, ratably to pay the Term Loan Obligations, in respect of
any fees and indemnities then due the Lenders until paid in full; (vi) sixth,
ratably to pay interest due in respect of the Term Loans until paid in full;
(vii) seventh, ratably to pay principal of the Term Loans until paid in full,
and (viii) eighth, to the ratable payment of all other Obligations then due and
payable, provided that (A) notwithstanding anything to the contrary, paragraph
(f) of this Section 4.04 and Section 10.08(e) shall apply to proceeds received
in respect of the Facility and (B) except as set forth in clause (A) above,
payments with respect to the Term Loans shall be applied, first, to the Term
Loan A Obligations, second, to the Term Loan B Obligations, and third, to the
Term Loan C Obligations.
(c) In each instance, so long as no Event of Default has
occurred and is continuing, Section 4.04(b) shall not be deemed to apply to any
payment by the Borrower specified by the Borrower to the Administrative Agent to
be for the payment of Term Loan Obligations, then due and payable under any
provision of this Agreement or the prepayment of all or part of the principal of
the Term Loans, in accordance with the terms and conditions of Section 2.05.
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(d) For purposes of Section 4.04(b), "paid in full" with respect
to interest shall include interest accrued after the commencement of any
Insolvency Proceeding irrespective of whether a claim for such interest is
allowable in such Insolvency Proceeding.
(e) In the event of a direct conflict between the priority
provisions of this Section 4.04 and other provisions contained in any other Loan
Document, it is the intention of the parties hereto that both such priority
provisions in such documents shall be read together and construed, to the
fullest extent possible, to be in concert with each other. In the event of any
actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms
and provisions of this Section 4.04 shall control and govern.
(f) Notwithstanding anything to the contrary, all proceeds
received in respect of the Facility shall be applied upon receipt, first, to the
outstanding Term Loan C Obligations and second, to the outstanding Term Loan B
Obligations.
(g) For the avoidance of doubt, all proceeds of Accounts
Receivable and Inventory, including, without limitation, insurance proceeds,
shall be deposited into the Lockboxes or Collection Accounts, and sent to the
Payment Office to be credited to the Administrative Agent's Account for
application to the Revolving Loans pursuant to Sections 2.05(c)(iii) and 8.01.
SECTION 4.05. Increased Costs and Reduced Return.
(a) If any Lender or the L/C Issuer shall have determined that
the adoption or implementation of, or any change in, any law, rule, treaty or
regulation, or any policy, guideline or directive of, or any change in the
interpretation or administration thereof by, any court, central bank or other
administrative or Governmental Authority, or compliance by the L/C Issuer or any
Lender or any Person controlling any such Lender or the L/C Issuer with any
directive of or guideline from any central bank or other Governmental Authority
or the introduction of or change in any accounting principles applicable to the
L/C Issuer or any Lender or any Person controlling any such Lender or the L/C
Issuer (in each case, whether or not having the force of law), shall (i) change
the basis of taxation of payments to the L/C Issuer or any Lender or any Person
controlling any such Lender or the L/C Issuer of any amounts payable hereunder
(except for taxes on the overall net income of the L/C Issuer or any Lender or
any Person controlling any such Lender or the L/C Issuer), (ii) impose, modify
or deem applicable any reserve, special deposit or similar requirement against
any Loan, the Support Letter of Credit or against assets of or held by, or
deposits with or for the account of, or credit extended by, the L/C Issuer or
any Lender, or any Person controlling any such Lender or the L/C Issuer or (iii)
impose on the L/C Issuer or any Lender or any Person controlling any such Lender
or the L/C Issuer any other condition regarding this Agreement or any Loan or
the Support Letter of Credit, and the result of any event referred to in clauses
(i), (ii) or (iii) above shall be to increase the cost to the L/C Issuer or any
Lender of making any Loan, issuing, guaranteeing or participating in the Support
Letter of Credit, or agreeing to make any Loan or issue, guaranty or participate
in the Support Letter of Credit, or to reduce any amount received or receivable
by the L/C Issuer or any Lender hereunder, then, upon demand by the L/C Issuer
or such Lender, the
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Borrower shall pay to the L/C Issuer or such Lender such additional amounts as
will compensate the L/C Issuer or such Lender for such increased costs or
reductions in amount.
(b) If any Lender or the L/C Issuer shall have determined that
any Capital Guideline or adoption or implementation of, or any change in, any
Capital Guideline by the Governmental Authority charged with the interpretation
or administration thereof, or compliance by the L/C Issuer, any Lender or any
Person controlling such L/C Issuer or any Lender with any Capital Guideline or
with any request or directive of any such Governmental Authority with respect to
any Capital Guideline, or the implementation of, or any change in, any
applicable accounting principles (in each case, whether or not having the force
of law), either (i) affects or would affect the amount of capital required or
expected to be maintained by the L/C Issuer, any Lender or any Person
controlling such L/C Issuer or any Lender, and the L/C Issuer or any Lender
determines that the amount of such capital is increased as a direct or indirect
consequence of any Loans made or maintained, the Support Letter of Credit issued
or any guaranty or participation with respect thereto, or the L/C Issuer's, any
Lender's or any such other controlling Person's other obligations hereunder, or
(ii) has or would have the effect of reducing the rate of return on the L/C
Issuer's, any Lender's, any such other controlling Person's capital to a level
below that which such L/C Issuer, such Lender or such controlling Person could
have achieved but for such circumstances as a consequence of any Loans made or
maintained, the Support Letter of Credit issued, or any guaranty or
participation with respect thereto or any agreement to make Loans, to issue the
Support Letter of Credit or such L/C Issuer's, such Lender's, such other
controlling Person's other obligations hereunder (in each case, taking into
consideration such L/C Issuer's, such Lender's or such other controlling
Person's policies with respect to capital adequacy), then, upon demand by the
L/C Issuer or any Lender, the Borrower shall pay to the L/C Issuer or such
Lender from time to time such additional amounts as will compensate the L/C
Issuer or such Lender for such cost of maintaining such increased capital or
such reduction in the rate of return on such L/C Issuer's, such Lender's or such
other controlling Person's capital.
(c) All amounts payable under this Section 4.05 shall bear
interest from the date that is ten days after the date of demand by the L/C
Issuer or a Lender until payment in full to the L/C Issuer or such Lender at the
Reference Rate. A certificate of the L/C Issuer or any Lender claiming
compensation under this Section 4.05 specifying the event herein above described
and the nature of such event shall be submitted by the L/C Issuer or such Lender
to the Borrower, setting forth the additional amount due and an explanation of
the calculation thereof, the L/C Issuer's or such Lender's reasons for invoking
the provisions of this Section 4.05, and shall be final and conclusive absent
manifest error.
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ARTICLE V
CONDITIONS TO LOANS
SECTION 5.01. Conditions Precedent to Effectiveness. This Agreement
shall become effective as of the Business Day (the "Effective Date") when each
of the following conditions precedent shall have been satisfied in a manner
satisfactory to the Agents:
(a) Payment of Fees, Etc. The Borrower shall have paid on or
before the date of this Agreement all fees, costs, expenses and taxes then
payable pursuant to Sections 2.06 and 12.04 (it being understood that the
Expense Deposit will be applied to reduce the amount of such fees, costs,
expenses and taxes).
(b) Representations and Warranties; No Event of Default. The
following statements shall be true and correct: (i) the representations and
warranties contained in Article VI and in each other Loan Document, certificate
or other writing delivered to the Agents, the Lenders or the L/C Issuer pursuant
hereto or thereto on or prior to the Effective Date are true and correct on and
as of the Effective Date as though made on and as of such date and (ii) no
Default or Event of Default shall have occurred and be continuing on the
Effective Date or would result from this Agreement or the other Loan Documents
becoming effective in accordance with its or their respective terms.
(c) Legality. The making of the initial Loans or the issuance of
the Support Letter of Credit shall not contravene any law, rule or regulation
applicable to the Agents, the Lenders or the L/C Issuer.
(d) Delivery of Documents. The Collateral Agent shall have
received on or before the Effective Date the following, each in form and
substance satisfactory to the Collateral Agent and, unless indicated otherwise,
dated the Effective Date:
(i) a Term A Note payable to the order of each Lender with a
Term Loan A Commitment, duly executed by the Borrower;
(ii) a Term B Note payable to the order of each Lender with
a Term Loan B Commitment, duly executed by the Borrower;
(iii) a Revolving Credit Note payable to the order of each
Lender with a Revolving Credit Commitment, duly executed by the Borrower;
(iv) a Security Agreement, duly executed by each of the
Parent and the Borrower;
(v) a Pledge Agreement, duly executed by each of the Parent
and the Borrower, together with all intercompany promissory notes of such Loan
Parties, accompanied by proper instruments of transfer;
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(vi) the Mortgage, Security Agreement, Assignment of Leases
and Rents and Fixture Filing in the maximum principal amount of $2,225,000, duly
executed by the Borrower, with respect to the Facility;
(vii) the Mortgage, Security Agreement, Assignment of Leases
and Rents and Fixture Filing in the maximum principal amount of $2,000,000, duly
executed by the Borrower, with respect to the Facility;
(viii) the Title Insurance Policy dated as of the Effective
Date;
(ix) a survey of the Facility, in form and substance
satisfactory to the Collateral Agent, certified to the Collateral Agent and to
the issuer of the Title Insurance Policy;
(x) a copy of each letter issued by the applicable State
Governmental Authority, evidencing the Facility's compliance with all applicable
building codes, fire codes, other health and safety rules and regulations,
parking, density and height requirements and other building and zoning laws;
(xi) an Environmental Indemnity Agreement, duly executed by
the Borrower;
(xii) appropriate financing statements on Form UCC-1, duly
executed by each Loan Party and duly filed in such office or offices as may be
necessary or, in the opinion of the Collateral Agent, desirable to perfect the
security interests purported to be created by the Security Agreements and the
Mortgages;
(xiii) certified copies of request for copies of information
on Form UCC-11, listing all effective financing statements which name as debtor
any Loan Party and which are filed in the offices referred to in paragraph (xii)
above, together with copies of such financing statements, none of which, except
as otherwise agreed in writing by the Collateral Agent, shall cover any of the
Collateral and the results of searches for any tax Lien and judgment Lien filed
against such Person or its property, which results, except as otherwise agreed
to in writing by the Collateral Agent, shall not show any such Liens;
(xiv) a copy of the resolutions of each Loan Party,
certified as of the Effective Date by an Authorized Officer thereof, authorizing
(A) the borrowings hereunder and the transactions contemplated by the Loan
Documents to which such Loan Party is or will be a party, and (B) the execution,
delivery and performance by such Loan Party of each Loan Document and the
execution and delivery of the other documents to be delivered by such Person in
connection herewith and therewith;
(xv) a certificate of an Authorized Officer of each Loan
Party, certifying the names and true signatures of the representatives of such
Loan Party authorized to sign each Loan Document to which such Loan Party is or
will be a party and the other documents to be executed and delivered by such
Loan Party in connection herewith and therewith, together with evidence of the
incumbency of such authorized officers;
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(xvi) a certificate of the appropriate official(s) of the
state of organization and each state of foreign qualification of each Loan Party
certifying as to the subsistence in good standing of, and the payment of taxes
by, such Loan Party in such states, together with confirmation by telephone or
telegram (where available) on the Effective Date from such official(s) as to
such matters;
(xvii) a true and complete copy of the charter, certificate
of formation, certificate of limited partnership or other publicly filed
organizational document of each Loan Party certified as of a date not more than
30 days prior to the Effective Date by an appropriate official of the state of
organization of such Loan Party;
(xviii)a copy of the charter and by-laws, limited liability
company agreement, operating agreement, agreement of limited partnership or
other organizational document of each Loan Party, together with all amendments
thereto, certified as of the Effective Date by an Authorized Officer of such
Loan Party;
(xix) an opinion of Xxxxxx & Xxxxxxx, counsel to the Loan
Parties, substantially in the form of Exhibit J and as to such other matters as
the Collateral Agent may reasonably request;
(xx) a certificate of an Authorized Officer of each Loan
Party, certifying as to the matters set forth in subsection (b) of this Section
5.01;
(xxi) a copy of the Financial Statements, together with a
certificate of an Authorized Officer of the Parent setting forth all existing
Indebtedness, pending or threatened litigation or claims and other contingent
liabilities of the Parent and its Subsidiaries;
(xxii) evidence of the insurance coverage required by
Section 7.01 and the terms of the Security Agreements and the Mortgages and such
other insurance coverage with respect to the business and operations of the Loan
Parties as the Collateral Agent may reasonably request, in each case, where
requested by the Collateral Agent, with such indorsements as to the named
insureds or loss payees thereunder as the Collateral Agent may request and
providing that such policy may be terminated or canceled (by the insurer or the
insured thereunder) only upon 30 days' prior written notice to the Collateral
Agent and each such named insured or loss payee, together with evidence of the
payment of all premiums due in respect thereof for such period as the Collateral
Agent may request;
(xxiii)a certificate of an Authorized Officer of the
Borrower, certifying the names and true signatures of the persons that are
authorized to provide Notices of Borrowings, Letters of Credit Applications and
all other notices under this Agreement and the other Loan Documents;
(xxiv) a landlord waiver, in form and substance satisfactory
to the Collateral Agent and which may be included as a provision contained in
the relevant Lease, executed by each landlord with respect to each of the Leases
set forth on Schedule 6.01(p);
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(xxv) a collateral access agreement, in form and substance
satisfactory to the Collateral Agent, executed by each Person who possesses
Inventory of the Borrower;
(xxvi) a certificate of an Authorized Officer of the Parent
stating that true and correct copies of the Indenture Documents, the XXX
Indenture Documents, the Fleet Documents, the Intercompany Loan Documents, the
WCLDC Loan Documents and the other Material Contracts as in effect on the
Effective Date have been previously been provided to the Agents' counsel and
that such agreements remain in full force and effect and that the Parent and its
Subsidiaries have not breached or defaulted in any of their obligations under
such agreements;
(xxvii) a termination and release agreement with respect to
the Existing Credit Facility and all related documents, duly executed by the
Borrower and the Existing Lender, together with UCC-3 termination statements for
all UCC-1 financing statements filed by the Existing Lender and covering any
portion of the Collateral;
(xxviii) a satisfactory update of the existing Phase I
environmental audit provided by Borrower to the Collateral Agent (and, if
requested by the Collateral Agent based upon the results of such update, a Phase
II environmental audit) of the Facility, in form and substance and by an
independent firm satisfactory to the Collateral Agent;
(xxix) such depository account, block account, lockbox
account and similar agreements and other documents, each in form and substance
satisfactory to the Agents, as the Agents may request with respect to the
Borrower's cash management system; and
(xxx) such other agreements, instruments, approvals,
opinions and other documents, each satisfactory to the Collateral Agent in form
and substance, as the Collateral Agent may reasonably request.
(e) Material Adverse Change. The Collateral Agent shall have
determined, in its sole judgment, that no material adverse change shall have
occurred in the business, operations, condition (financial or otherwise),
properties or prospects of any Loan Party since March 31, 2000.
(f) Proceedings; Receipt of Documents. All proceedings in
connection with the making of the initial Loan or the issuance of the Support
Letter of Credit and the other transactions contemplated by this Agreement and
the other Loan Documents, and all documents incidental hereto and thereto, shall
be satisfactory to the Collateral Agent and its counsel, and the Collateral
Agent and such counsel shall have received all such information and such
counterpart originals or certified or other copies of such documents as the
Collateral Agent or such counsel may reasonably request.
(g) Management Reference Checks. The Collateral Agent shall have
received satisfactory reference checks for key management of each Loan Party.
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(h) Due Diligence. The Agents shall have completed their due
diligence with respect to each Loan Party and the results thereof shall be
acceptable to the Agents, in their sole and absolute discretion. Without
limiting the foregoing, the Collateral Agent shall have received an appraisal of
the Collateral, dated not earlier than 30 days prior to the Effective Date, from
such appraisal firm as selected by Collateral Agent, and such appraisal and the
results thereof shall be acceptable to the Collateral Agent, in its sole and
absolute discretion.
(i) Availability. After giving effect to all Loans made on the
Effective Date and the Support Letter of Credit issued on the Effective Date,
(i) the Availability shall not be less than $1,900,000 and (ii) all liabilities
of the Loan Parties shall be current. The Borrower shall deliver to the Agent a
certificate of the chief financial officer and the chief operating officer of
the Borrower certifying as to the matters set forth in clauses (i) and (ii)
above and containing the calculations thereof.
SECTION 5.02. Conditions Precedent to all Loans and the Support
Letter of Credit. The obligation of any Agent or any Lender to make any Loan or
of the Administrative Agent to assist the Borrower in establishing or opening
the Support Letter of Credit is subject to the fulfillment, in a manner
satisfactory to the Administrative Agent, of each of the following conditions
precedent:
(a) Payment of Fees, Etc. The Borrower shall have paid all fees,
costs, expenses and taxes then payable by the Borrower pursuant to this
Agreement and the other Loan Documents, including, without limitation, Sections
2.06 and 12.04 hereof.
(b) Representations and Warranties; No Event of Default. The
following statements shall be true and correct, and the submission by the
Borrower to the Administrative Agent of a Notice of Borrowing with respect to
each such Loan, and the Borrower's acceptance of the proceeds of such Loan, or
the submission by the Borrower of a Letter of Credit Application with respect to
the Support Letter of Credit, and the issuance of the Support Letter of Credit,
shall each be deemed to be a representation and warranty by the Borrower on the
date of such Loan or the date of issuance of the Support Letter of Credit that:
(i) the representations and warranties contained in Article VI and in each other
Loan Document, certificate or other writing delivered to the Agents pursuant
hereto or thereto on or prior to the date of such Loan or the Support Letter of
Credit are true and correct on and as of such date as though made on and as of
such date, (ii) at the time of and after giving effect to the making of such
Loan and the application of proceeds thereof or at the time of issuance of the
Support Letter of Credit, no Default or Event of Default has occurred and is
continuing or would result from the making of the Loan to be made, or the
issuance of the Support Letter of Credit to be issued, on such date and (iii)
the conditions set forth in this Section 5.02 have been satisfied as of the date
of such request.
(c) Legality. The making of such Loan or the issuance of the
Support Letter of Credit shall not contravene any law, rule or regulation
applicable to the Agents, the Lenders or the L/C Issuer.
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(d) Notices; Borrowing Base Certificate. Except in the case of a
Revolving Loan pursuant to Section 3.01(c), the Administrative Agent shall have
received (i) a Notice of Borrowing pursuant to Section 2.02 hereof together
with, in the case of a Revolving Loan, a Borrowing Base Certificate as required
by Section 2.02 hereof and (ii) a Letter of Credit Application pursuant to
Section 3.03 hereof.
(e) Delivery of Documents. The Agents shall have received such
other agreements, instruments, approvals, opinions and other documents, each in
form and substance satisfactory to the Agents, as any Agent may reasonably
request.
(f) Proceedings; Receipt of Documents. All proceedings in
connection with the making of such Loan or the issuance of the Support Letter of
Credit and the other transactions contemplated by this Agreement and the other
Loan Documents, and all documents incidental hereto and thereto, shall be
satisfactory to the Agents and their counsel, and the Agents and such counsel
shall have received all such information and such counterpart originals or
certified or other copies of such documents, in form and substance satisfactory
to the Agents, as the Agents or such counsel may reasonably request.
(g) Title Continuation; Term C Note. In the case of the Term
Loan C, the Collateral Agent shall have received, in form and substance
satisfactory to it, (i) a date down endorsement from the title insurer issuing
the Title Insurance Policy, effective as of the Term Loan C Effective Date,
increasing the amount of coverage under the Title Insurance Policy by the amount
of the aggregate principal amount of Term Loan C, and indicating that since the
issuance of the Title Insurance Policy there has been no Lien not theretofore
approved by the Collateral Agent, together with other evidence satisfactory to
the Collateral Agent that no mechanics' liens have been filed and remain filed
with respect to the Facility and (ii) a Term C Note payable to the order of each
Lender with a Term Loan C Commitment, duly executed by the Borrower.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01. Representations and Warranties. Each Loan Party hereby
represents and warrants to the Agents, the Lenders and the L/C Issuer as
follows:
(a) Organization, Good Standing, Etc. Each Loan Party (i) is a
corporation, limited liability company or limited partnership duly organized,
validly existing and in good standing under the laws of the state of its
organization, (ii) has all requisite power and authority to conduct its business
as now conducted and as presently contemplated and, in the case of the Borrower,
to make the borrowings hereunder, and to execute and deliver each Loan Document
to which it is a party, and to consummate the transactions contemplated thereby,
and (iii) is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it or
in which the transaction of its business makes such qualification necessary.
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(b) Authorization, Etc. The execution, delivery and performance
by each Loan Party of each Loan Document to which it is or will be a party, (i)
have been duly authorized by all necessary action, (ii) do not and will not
contravene its charter or by-laws, its limited liability company or operating
agreement or its certificate of partnership or partnership agreement, as
applicable, or any applicable law or any contractual restriction binding on or
otherwise affecting it or any of its properties, (iii) do not and will not
result in or require the creation of any Lien (other than pursuant to any Loan
Document) upon or with respect to any of its properties, and (iv) do not and
will not result in any suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to its
operations or any of its properties.
(c) Governmental Approvals. No authorization or approval or
other action by, and no notice to or filing with, any Governmental Authority is
required in connection with the due execution, delivery and performance by any
Loan Party of any Loan Document to which it is or will be a party.
(d) Enforceability of Loan Documents. This Agreement is, and
each other Loan Document to which any Loan Party is or will be a party, when
delivered hereunder, will be, a legal, valid and binding obligation of such
Person, enforceable against such Person in accordance with its terms, except as
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws.
(e) Subsidiaries. Schedule 6.01(e) is a complete and correct
description of the name, jurisdiction of incorporation and ownership of the
outstanding Capital Stock of such Subsidiaries of the Parent in existence on the
date hereof. All of the issued and outstanding shares of Capital Stock of such
Subsidiaries have been validly issued and are fully paid and nonassessable, and
the holders thereof are not entitled to any preemptive, first refusal or other
similar rights. Except as indicated on such Schedule, all such Capital Stock is
owned by the Parent or one or more of its wholly-owned Subsidiaries, free and
clear of all Liens. There are no outstanding debt or equity securities of any
Subsidiaries of the Borrower and no outstanding obligations of any Subsidiaries
of the Borrower convertible into or exchangeable for, or warrants, options or
other rights for the purchase or acquisition from any Subsidiaries of the
Borrower, or other obligations of any Subsidiary to issue, directly or
indirectly, any shares of Capital Stock of any Subsidiary of the Borrower.
(f) Litigation. Except as set forth in Schedule 6.01(f), there
is no pending or, to the knowledge of any Loan Party, threatened action, suit or
proceeding affecting any Loan Party before any court or other Governmental
Authority or any arbitrator that (i) if adversely determined, could have a
Material Adverse Effect or (ii) relates to this Agreement, the Notes or any
other Loan Document or any transaction contemplated hereby or thereby.
(g) Financial Condition.
(i) The Financial Statements, copies of which have been
delivered to the Agents and the Lenders, fairly present the consolidated
financial condition of the Parent and its Subsidiaries as at the respective
dates thereof and the consolidated results of
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operations of the Parent and its Subsidiaries for the fiscal periods ended on
such respective dates, all in accordance with GAAP, and since March 31, 2000, no
event or development has occurred that has had or could have a Material Adverse
Effect.
(ii) The Parent has heretofore furnished to the Lenders (A)
a projected monthly Borrowing Base and Consolidated EBITDA of the Borrower for
the period from April 1, 2001 through March 31, 2003, and (B) projected annual
balance sheets, income statements and statements of cash flows of the Parent and
its Subsidiaries for the Fiscal Years ending in 2001 through 2003, in each case
as may be updated from time to time pursuant to Section 7.01(a)(vii). Such
projections, as so updated, are believed by the Parent at the time furnished to
be reasonable, have been prepared on a reasonable basis and in good faith by the
Parent, and have been based on assumptions believed by the Parent to be
reasonable at the time made and upon the best information then reasonably
available to the Parent, and the Parent is not aware of any facts or information
that would lead it to believe that such projections, as so updated, are
incorrect or misleading in any material respect.
(h) Compliance with Law, Etc. None of the Loan Parties is in
violation of its organizational documents, any law, rule, regulation, judgment
or order of any Governmental Authority applicable to it or any of its property
or assets, or any material term of any agreement or instrument (including,
without limitation, any Material Contract) binding on or otherwise affecting it
or any of its properties, and no Default or Event of Default has occurred and is
continuing.
(i) ERISA. Except as set forth on Schedule 6.01(i), (i) each
Employee Plan is in substantial compliance with ERISA and the Code, (ii) no
Termination Event has occurred nor is reasonably expected to occur with respect
to any Employee Plan, (iii) the most recent annual report (Form 5500 Series)
with respect to each Employee Plan, including any required Schedule B (Actuarial
Information) thereto, copies of which have been filed with the Internal Revenue
Service and delivered to the Agents, is complete and correct and fairly presents
the funding status of such Employee Plan, and since the date of such report
there has been no material adverse change in such funding status, (iv) no
Employee Plan had an accumulated or waived funding deficiency or permitted
decreases which would create a deficiency in its funding standard account or has
applied for an extension of any amortization period within the meaning of
Section 412 of the Code at any time during the previous 60 months, and (v) no
Lien imposed under the Code or ERISA exists or is likely to arise on account of
any Employee Plan within the meaning of Section 412 of the Code at any time
during the previous 60 months. Except as set forth on Schedule 6.01(i), none of
the Loan Parties or any of their ERISA Affiliates have incurred any withdrawal
liability under ERISA with respect to any Multiemployer Plan, or are aware of
any facts indicating that the Loan Parties or any of their ERISA Affiliates may
in the future incur any such withdrawal liability. Except as required by Section
4980B of the Code, none of the Loan Parties or any of their ERISA Affiliates
maintains an employee welfare benefit plan (as defined in Section 3(1) of ERISA)
which provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of any Loan Party or any of its
ERISA Affiliates or coverage after a participant's termination of employment.
None of the Loan Parties or any of their ERISA Affiliates has incurred any
liability or obligation under the Worker Adjustment and Retraining Notification
Act ("WARN") or similar state law, which remains unpaid or unsatisfied.
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(j) Taxes, Etc. All Federal, state and local tax returns and
other reports required by applicable law to be filed by any Loan Party have been
filed, or extensions have been obtained, and all taxes, assessments and other
governmental charges imposed upon any Loan Party or any property of any Loan
Party and which have become due and payable on or prior to the date hereof have
been paid, except to the extent contested in good faith by proper proceedings
which stay the imposition of any penalty, fine or Lien resulting from the
non-payment thereof and with respect to which adequate reserves have been set
aside for the payment thereof.
(k) Regulation U. None of the Loan Parties is nor will be
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulations T, U or X), and no
proceeds of any Loan will be used to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any margin
stock.
(l) Nature of Business. The Borrower is not engaged in any
business other than the manufacture and distribution of consumer self-adhesive,
decorative and surface protection products, industrial laminates and textured
films.
(m) Adverse Agreements, Etc. Neither the Parent nor any other
Loan Party is a party to any agreement or instrument, or subject to any charter,
limited liability company agreement, partnership agreement or other corporate,
partnership or limited liability company restriction or any judgment, order,
regulation, ruling or other requirement of a court or other Governmental
Authority, which has, or in the future could have, a Material Adverse Effect.
(n) Permits, Etc. Each Loan Party has, and is in compliance
with, all material permits, licenses, authorizations, approvals, entitlements
and accreditations required for such Person lawfully to own, lease, manage or
operate, or to acquire, each business currently owned, leased, managed or
operated, or to be acquired, by such Person. No condition exists or event has
occurred which, in itself or with the giving of notice or lapse of time or both,
would result in the suspension, revocation, impairment, forfeiture or
non-renewal of any such permit, license, authorization, approval, entitlement or
accreditation, and there is no claim that any thereof is not in full force and
effect.
(o) Properties. (i) Each Loan Party has good and marketable
title to, or valid leasehold interests in, all property and assets material to
its business, free and clear of all Liens except Permitted Liens. The properties
are in good working order and condition, ordinary wear and tear excepted.
(ii) Schedule 6.01(o) sets forth a complete and accurate
list as of the Effective Date of the location, by state and street address, of
all real property owned or leased by each Loan Party. As of the Effective Date,
each Loan Party has valid leasehold interests in the Leases described on
Schedule 6.01(o) to which it is a party. Schedule 6.01(o) sets forth with
respect to each such Lease, the commencement date, termination date, renewal
options (if any) and annual base rents. Each such Lease is valid and enforceable
in accordance with its terms in all material respects and is in full force and
effect. No consent or approval of any landlord or other third party in
connection with any such Lease is necessary for any Loan Party to enter into and
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execute the Loan Documents to which it is a party, except as set forth on
Schedule 6.01(o). To the knowledge of any Loan Party, no other party to any such
Lease is in default of its obligations thereunder, and none of the Loan Parties
(or any other party to any such Lease) has not at any time delivered or received
any notice of default which remains uncured under any such Lease and, as of the
Effective Date, no event has occurred which, with the giving of notice or the
passage of time or both, would constitute a default under any such Lease.
(p) Full Disclosure. Each Loan Party has disclosed to the Agents
all agreements, instruments and corporate or other restrictions to which it is
subject, and all other matters known to it, that, individually or in the
aggregate, could result in a Material Adverse Effect. None of the other reports,
financial statements, certificates or other information furnished by or on
behalf of any Loan Party to the Agents in connection with the negotiation of
this Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which it was made, not misleading; provided that,
with respect to projected financial information, each Loan Party represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time. There is no contingent liability or fact that may
have a Material Adverse Effect which has not been set forth in a footnote
included in the Financial Statements or a schedule hereto.
(q) Year 2000. Any reprogramming required to permit the proper
functioning, in and following the year 2000, of (i) any Loan Party's computer
systems and (ii) equipment containing embedded microchips (including systems and
equipment supplied by others or with which any Loan Party's systems interface)
and the testing of all such systems and equipment, as so reprogrammed, has been
completed. The cost to such Loan Party of such reprogramming and testing and of
the reasonably foreseeable consequences of year 2000 to such Loan Party
(including, without limitation, reprogramming errors and the failure of others'
systems or equipment) will not result in a Default or a Material Adverse Effect.
Except for such of the reprogramming referred to in the preceding sentence as
may be necessary, the computer and management information systems of each Loan
Party are and, with ordinary course upgrading and maintenance, will continue for
the term of this Agreement to be, sufficient to permit such Loan Party to
conduct its business without Material Adverse Effect.
(r) Operating Lease Obligations. On the Effective Date, none of
the Loan Parties has any obligations as lessee for the payment of rent for any
real or personal property other than the Operating Lease Obligations set forth
on Schedule 6.01(r).
(s) Environmental Matters. Except as set forth on Schedule
6.01(s), (i) the operations of each Loan Party are in compliance with
Environmental Laws; (ii) there has been no Release at any of the properties
owned or operated by any Loan Party or a predecessor in interest, or at any
disposal or treatment facility which received Hazardous Materials generated by
any Loan Party or any predecessor in interest which could have a Material
Adverse Effect; (iii) no Environmental Action has been asserted against any Loan
Party or any predecessor in interest nor does any Loan Party have knowledge or
notice of any threatened or pending Environmental Action
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against any Loan Party or any predecessor in interest which could have a
Material Adverse Effect; and (iv) no Environmental Actions have been asserted
against any facilities that may have received Hazardous Materials generated by
any Loan Party or any predecessor in interest which could have a Material
Adverse Effect.
(t) Insurance. Each Loan Party keeps its property adequately
insured and maintains (i) insurance to such extent and against such risks,
including fire, as is customary with companies in the same or similar
businesses, (ii) workmen's compensation insurance in the amount required by
applicable law, (iii) public liability insurance, which shall include product
liability insurance, in the amount customary with companies in the same or
similar business against claims for personal injury or death on properties
owned, occupied or controlled by it, and (iv) such other insurance as may be
required by law or as may be reasonably required by the Collateral Agent
(including, without limitation, against larceny, embezzlement or other criminal
misappropriation). Schedule 6.01(t) sets forth a list of all insurance
maintained by each Loan Party on the Effective Date.
(u) Use of Proceeds. The proceeds of the Loans shall be used to
(a) refinance existing indebtedness of the Borrower, (b) pay fees and expenses
in connection with the transactions contemplated hereby, (c) provide funds for
interest payments under the Senior Secured Notes, and (d) fund working capital
of the Borrower. The Support Letter of Credit will be used to support the Fleet
Letter of Credit.
(v) Solvency. After giving effect to the transactions
contemplated by this Agreement and before and after giving effect to each Loan
and the Support Letter of Credit, each Loan Party is, and the Loan Parties on a
consolidated basis are, Solvent.
(w) Location of Bank Accounts. Schedule 6.01(w) sets forth a
complete and accurate list as of the Effective Date of all deposit, checking and
other bank accounts, all securities and other accounts maintained with any
broker dealer and all other similar accounts maintained by each Loan Party,
together with a description thereof (i.e., the bank or broker dealer at which
such deposit or other account is maintained and the account number and the
purpose thereof).
(x) Intellectual Property. Except as set forth on Schedule
6.01(x), each Loan Party owns or licenses or otherwise has the right to use all
licenses, permits, patents, patent applications, trademarks, trademark
applications, service marks, tradenames, copyrights, copyright applications,
franchises, authorizations and other intellectual property rights that are
necessary for the operations of its businesses, without infringement upon or
conflict with the rights of any other Person with respect thereto, except for
such infringements and conflicts which, individually or in the aggregate, could
not have a Material Adverse Effect. Set forth on Schedule 6.01(x) is a complete
and accurate list as of the Effective Date of all such material licenses,
permits, patents, patent applications, trademarks, trademark applications,
service marks, tradenames, copyrights, copyright applications, franchises,
authorizations and other intellectual property rights of each Loan Party. No
slogan or other advertising device, product, process, method, substance, part or
other material now employed, or now contemplated to be employed, by any Loan
Party infringes upon or
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conflicts with any rights owned by any other Person, and no claim or litigation
regarding any of the foregoing is pending or threatened, except for such
infringements and conflicts which could not have, individually or in the
aggregate, a Material Adverse Effect. To the best knowledge of each Loan Party,
no patent, invention, device, application, principle or any statute, law, rule,
regulation, standard or code is pending or proposed, which, individually or in
the aggregate, could have a Material Adverse Effect.
(y) Material Contracts. Set forth on Schedule 6.01(y) is a
complete and accurate list as of the Effective Date of all Material Contracts of
each Loan Party, showing the parties and subject matter thereof and amendments
and modifications thereto. Each such Material Contract (i) is in full force and
effect and is binding upon and enforceable against each Loan Party that is a
party thereto and, to the best knowledge of such Loan Party, all other parties
thereto in accordance with its terms, (ii) has not been otherwise amended or
modified, and (iii) is not in default due to the action of any Loan Party or, to
the best knowledge of any Loan Party, any other party thereto.
(z) Holding Company and Investment Company Acts. None of the
Loan Parties is (i) a "holding company" or a "subsidiary company" of a "holding
company" or an "affiliate" of a "holding company", as such terms are defined in
the Public Utility Holding Company Act of 1935, as amended, or (ii) an
"investment company" or an "affiliated person" or "promoter" of, or "principal
underwriter" of or for, an "investment company", as such terms are defined in
the Investment Company Act of 1940, as amended.
(aa) Employee and Labor Matters. (i) There is (A) no unfair
labor practice complaint pending or, to the best knowledge of any Loan Party,
threatened against any Loan Party before any Governmental Authority and no
grievance or arbitration proceeding pending or threatened against any Loan Party
which arises out of or under any collective bargaining agreement, (B) no strike,
labor dispute, slowdown, stoppage or similar action or grievance pending or
threatened against any Loan Party and (C) to the best knowledge of any Loan
Party, no union representation question existing with respect to the employees
of any Loan Party and no union organizing activity taking place with respect to
any of the employees of any of them.
(bb) Customers and Suppliers. There exists no actual or
threatened termination, cancellation or limitation of, or modification to or
change in, the business relationship between (A) any Loan Party, on the one
hand, and any customer or any group thereof, on the other hand, whose agreements
with any Loan Party are individually or in the aggregate material to the
business or operations of such Loan Party, or (B) any Loan Party, on the one
hand, and any material supplier thereof, on the other hand; and there exists no
present state of facts or circumstances that could give rise to or result in any
such termination, cancellation, limitation, modification or change.
(cc) No Bankruptcy Filing. None of the Loan Parties is
contemplating either the filing of a petition by it under any state or federal
bankruptcy or insolvency laws or the
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liquidation of all or a major portion of such Loan Party's assets or property,
and none of the Loan Parties has any knowledge of any Person contemplating the
filing of any such petition against it.
(dd) Separate Existence.
(i) All customary formalities regarding the corporate
existence of each Loan Party has been at all times since its formation and will
continue to be observed.
(ii) Each Loan Party has at all times since its formation
accurately maintained, and will continue to accurately maintain, its financial
statements, accounting records and other organizational documents separate from
those of any Affiliate of such Loan Party and any other Person. None of the Loan
Parties has at any time since its formation commingled, and will not commingle,
its assets with those of any of its Affiliates or any other Person. Each Loan
Party has at all times since its formation accurately maintained, and will
continue to accurately maintain its own bank accounts and separate books of
account.
(iii) Each Loan Party has at all times since its formation
paid, and will continue to pay, its own liabilities from its own separate
assets.
(iv) Each Loan Party has at all times since its formation
identified itself, and will continue to identify itself, in all dealings with
the public, under its own name and as a separate and distinct Person. Each Loan
Party has not at any time since its formation identified itself, and will not
identify itself, as being a division or a part of any other Person.
(ee) Location of Inventory; Place of Business; Chief Executive
Office. There is no location at which the Borrower has any Inventory (except for
Inventory in transit) other than (i) those locations listed on Schedule 6.01(ee)
and (ii) any other locations approved in writing by the Collateral Agent
pursuant to the definition of "Eligible Inventory". Schedule 6.01(ee) hereto
contains a true, correct and complete list, as of the Effective Date, of the
legal names and addresses of each warehouse at which Inventory of each Loan
Party is stored. None of the receipts received by any Loan Party from any
warehouse states that the goods covered thereby are to be delivered to bearer or
to the order of a named Person or to a named Person and such named Person's
assigns. Schedule 6.01(ee) sets forth a complete and accurate list as of the
date hereof of (A) each place of business of each Loan Party and (B) the chief
executive office of each Loan Party.
(ff) Tradenames. Schedule 6.01(ff) hereto sets forth a complete
and accurate list as of the Effective Date of all tradenames used by each Loan
Party.
(gg) Security Interests. Each Security Agreement creates in
favor of the Collateral Agent, for the benefit of the Lenders, a legal, valid
and enforceable security interest in the Collateral secured thereby. Upon the
filing of the UCC-1 financing statements described in Section 5.01(d)(xi), the
recording of the Collateral Assignment for Security (Trademarks), referred to in
each Security Agreement, in the United States Patent and Trademark Office, such
security interests in and Liens on the Collateral granted thereby shall be
perfected, first priority security
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interests, subject, however, to Liens senior in priority which are Permitted
Liens, and no further recordings or filings are or will be required in
connection with the creation, perfection or enforcement of such security
interests and Liens, other than (i) the filing of continuation statements in
accordance with applicable law, (ii) the recording of the Collateral Assignment
for Security (Trademarks) pursuant to each Security Agreement in the United
States Patent and Trademark Office, with respect to after-acquired U.S. patent
and trademark applications and registrations, (iii) the recordation of
appropriate evidence of the security interest in the appropriate foreign
registry with respect to all foreign intellectual property, and (iv) the
registration of all U.S. copyrights and the recordation of the Collateral
Assignment for Security (Copyrights) in the United States Copyright Office.
(hh) Schedules. All of the information which is required to be
scheduled to this Agreement is set forth on the Schedules attached hereto, is
correct and accurate and does not omit to state any information material
thereto.
(ii) Representations and Warranties in Documents; No Default.
All representations and warranties set forth in the Loan Documents are true and
correct in all respects at the time as of which such representations were made
and on the Effective Date. No Event of Default has occurred and is continuing
and no condition exists which constitutes a Default or an Event of Default.
(jj) Indenture. The Borrower incurring Indebtedness from (i) the
Loans made by the Lenders to the Borrower on and after Effective Date and (ii)
the issue of the Support Letter of Credit on the Effective Date, in each case
does not conflict with or result in a default under the Indenture.
ARTICLE VII
COVENANTS OF THE BORROWER
SECTION 7.01. Affirmative Covenants. So long as any principal of or
interest on any Loan, Reimbursement Obligation, Letter of Credit Obligation or
any other Obligations (whether or not due) shall remain unpaid or any Lender
shall have any Commitment hereunder, the Loan Parties will, unless the Required
Lenders shall otherwise consent in writing:
(a) Reporting Requirements. Furnish to each Agent and each
Lender:
(i) as soon as available and in any event within 50 days
after the end of each fiscal quarter of the Parent, consolidated and
consolidating balance sheets, consolidated and consolidating statements of
operations and retained earnings and consolidated and consolidating statements
of cash flows of the Parent and its Consolidated Subsidiaries as at the end of
such quarter, and for the period commencing at the end of the immediately
preceding Fiscal Year and ending with the end of such quarter, setting forth in
each case in comparative form the figures for the corresponding date or period
of the immediately preceding Fiscal Year, all in reasonable detail and certified
by an Authorized Officer as fairly presenting, in all material respects, the
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financial position of the Parent and its Subsidiaries as of the end of such
quarter and the results of operations and cash flows of the Parent and its
Subsidiaries for such quarter, in accordance with GAAP applied in a manner
consistent with that of the most recent audited financial statements of the
Parent and its Subsidiaries furnished to the Lenders, subject to normal year-end
adjustments;
(ii) as soon as available, and in any event within 105 days
after the end of each Fiscal Year consolidated and consolidating balance sheets,
consolidated and consolidating statements of operations and retained earnings
and consolidated and consolidating statements of cash flows of the Parent and
its Consolidated Subsidiaries as at the end of such Fiscal Year, setting forth
in comparative form the corresponding figures for the immediately preceding
Fiscal Year, all in reasonable detail and prepared in accordance with GAAP, and
accompanied by a report and an unqualified opinion, prepared in accordance with
generally accepted auditing standards, of independent certified public
accountants of recognized standing selected by the Parent and satisfactory to
the Agents (which opinion shall be without (A) a "going concern" or like
qualification or exception, (B) any qualification or exception as to the scope
of such audit or (C) any qualification which relates to the treatment or
classification of any item and which, as a condition to the removal of such
qualification, would require an adjustment to such item, the effect of which
would be to cause any noncompliance with the provisions of Section 7.03,
together with a written statement of such accountants (1) to the effect that, in
making the examination necessary for their certification of such financial
statements, they have not obtained any knowledge of the existence of an Event of
Default or a Default and (2) if such accountants shall have obtained any
knowledge of the existence of an Event of Default or such Default, describing
the nature thereof;
(iii) as soon as available, and in any event within 30 days
of the end of each fiscal month of the Parent and its Consolidated Subsidiaries
internally prepared consolidated and consolidating balance sheets, consolidated
and consolidating statements of operations and consolidated and consolidating
statements of cash flows for such fiscal month of the Parent and its
Subsidiaries for such fiscal month and for the period from the beginning of such
Fiscal Year to the end of such fiscal month, all in reasonable detail and
certified by an Authorized Officer as fairly presenting, in all material
respects, the financial position of the Parent and its Subsidiaries as of the
end of such fiscal month and the results of operations and cash flows of the
Parent and its Subsidiaries for such fiscal month, in accordance with GAAP
applied in a manner consistent with that of the most recent audited financial
statements furnished to the Lenders, subject to normal year-end adjustments;
(iv) simultaneously with the delivery of the financial
statements of the Parent required by clauses (i), (ii) and (iii) of this Section
7.01(a), a certificate of an Authorized Officer (A) stating that such Authorized
Officer has reviewed the provisions of this Agreement and the other Loan
Documents and has made or caused to be made under his or her supervision a
review of the condition and operations of the Parent and its Subsidiaries during
the period covered by such financial statements with a view to determining
whether the Parent and its Subsidiaries were in compliance with all of the
provisions of such Loan Documents at the times such compliance is required by
the Loan Documents, and that such review has not disclosed, and such Authorized
Officer has no knowledge of, the existence during such period of an Event of
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Default or Default or, if an Event of Default or Default existed, describing the
nature and period of existence thereof and the action which the Parent and its
Subsidiaries propose to take or have taken with respect thereto and (B)
attaching a schedule showing the calculations specified in Section 7.03;
(v) as soon as available and in any event within 10 days of
the end of each fiscal month of the Borrower, reports in detail satisfactory to
the Agents and certified by an Authorized Officer as being accurate and complete
(A) listing all Accounts Receivable of the Borrower as of such day, which shall
include the amount and age of each Account Receivable, showing separately those
which are more than 30, 60, 90 and 120 days old and a description of all Liens,
set-offs, defenses and counterclaims with respect thereto, together with a
reconciliation of such schedule with the schedule delivered to the Agents
pursuant to this clause (v)(A) for the immediately preceding fiscal month, the
name and mailing address of each Account Debtor with respect to each such
Account Receivable and such other information as any Agent may request, (B)
listing all accounts payable of the Borrower as of each such day which shall
include the amount and age of each account payable, the name and mailing address
of each account creditor and such other information as any Agent may request,
and (C) listing all Inventory of the Borrower as of each such day, and
containing a breakdown of such Inventory by type and amount, the cost and the
current market value thereof (by location), the date of acquisition, the
warehouse and production facility location and such other information as any
Agent may request, all in detail and in form satisfactory to the Agents;
(vi) on the date of each Revolving Loan and within 3
Business Days after the end of each week, a Borrowing Base Certificate, current
as of the close of business on the preceding day, in the case of a Borrowing
Base Certificate with respect to a Revolving Loan, and as of Friday of the
immediately preceding week, in the case of a weekly Borrowing Base Certificate,
supported by schedules showing the derivation thereof and containing such detail
and other information as any Agent may request from time to time provided, that
(A) the Borrowing Base set forth in the Borrowing Base Certificate shall be
effective from and including the date such Borrowing Base Certificate is duly
received by the Agents but not including the date on which a subsequent
Borrowing Base Certificate is received by the Agents, unless any Agent disputes
the eligibility of any property for inclusion in the calculation of the
Borrowing Base or the valuation thereof by notice of such dispute to the
Borrower and (B) in the event of any dispute about the eligibility of any
property for inclusion in the calculation of the Borrowing Base or the valuation
thereof, such Agent's good faith judgment shall control;
(vii) (A) on or before March 15 of each year, financial
projections supplementing and superseding the financial projections for such
period referred to in Section 6.01(g)(ii), prepared on a monthly basis and
otherwise in form and substance satisfactory to the Agents, for the immediately
succeeding Fiscal Year for the Parent and its Subsidiaries and (B) on or before
October 31 of each fiscal year, financial projections supplementing and
superseding the financial projections for such period referred to in Section
6.01(g)(ii), in form and substance satisfactory to the Agents, for each
remaining quarterly period in such Fiscal Year, all such financial projections
to be reasonable, to be prepared on a reasonable basis and in good faith,
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and to be based on assumptions believed by the Parent to be reasonable at the
time made and from the best information then available to the Parent;
(viii) promptly after submission to any Government
Authority, all documents and information furnished to such Government Authority
in connection with any investigation of any Loan Party other than routine
inquiries by such Governmental Authority;
(ix) as soon as possible, and in any event within three
days after the occurrence of an Event of Default or Default or the occurrence of
any event or development that could have a Material Adverse Effect, the written
statement of an Authorized Officer setting forth the details of such Event of
Default, Default, other event or Material Adverse Effect and the action which
the Parent and its Subsidiaries propose to take with respect thereto;
(x) (A) as soon as possible and in any event (1) within 10
days after any Loan Party or any ERISA Affiliate thereof knows or has reason to
know that any Termination Event described in clause (i) of the definition of
Termination Event with respect to any Employee Plan has occurred, (2) within 10
days after the Borrower or any ERISA Affiliate thereof knows or has reason to
know that any other Termination Event with respect to any Employee Plan has
occurred, or (3) within 10 days after any Loan Party or any ERISA Affiliate
thereof knows or has reason to know that an accumulated funding deficiency has
been incurred or an application has been made to the Secretary of the Treasury
for a waiver or modification of the minimum funding standard (including
installment payments) or an extension of any amortization period under Section
412 of the Code with respect to an Employee Plan, a statement of an Authorized
Officer setting forth the details of such occurrence and the action, if any,
which such Loan Party or such ERISA Affiliate proposes to take with respect
thereto, (B) promptly and in any event within three days after receipt thereof
by any Loan Party or any ERISA Affiliate thereof from the PBGC, copies of each
notice received by any Loan Party or any ERISA Affiliate thereof of the PBGC's
intention to terminate any Plan or to have a trustee appointed to administer any
Plan, (C) promptly and in any event within 10 days after the filing thereof with
the Internal Revenue Service if requested by the Agent, copies of each Schedule
B (Actuarial Information) to the annual report (Form 5500 Series) with respect
to each Employee Plan and Multiemployer Plan, (D) promptly and in any event
within 10 days after any Loan Party or any ERISA Affiliate thereof knows or has
reason to know that a required installment within the meaning of Section 412 of
the Code has not been made when due with respect to an Employee Plan, (E)
promptly and in any event within three days after receipt thereof by any Loan
Party or any ERISA Affiliate thereof from a sponsor of a Multiemployer Plan or
from the PBGC, a copy of each notice received by any Loan Party or any ERISA
Affiliate thereof concerning the imposition or amount of withdrawal liability
under Section 4202 of ERISA or indicating that such Multiemployer Plan may enter
reorganization status under Section 4241 of ERISA, and (F) promptly and in any
event within 10 days after any Loan Party or any ERISA Affiliate thereof send
notice of a plant closing or mass layoff (as defined in WARN) to employees,
copies of each such notice sent by such Loan Party or such ERISA Affiliate
thereof;
(xi) promptly after the commencement thereof but in any
event not later than 5 days after service of process with respect thereto on, or
the obtaining of knowledge thereof by, any Loan Party, notice of each action,
suit or proceeding before any court or other
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Governmental Authority or other regulatory body or any arbitrator which, if
adversely determined, could have a Material Adverse Effect;
(xii) as soon as possible and in any event within 10 days
after execution, receipt or delivery thereof, copies of any material notices
that any Loan Party executes or receives in connection with any Indenture
Document, XXX Indenture Document, Intercompany Loan Document, WCLDC Loan
Document or any other Material Contract;
(xiii) promptly after the sending or filing thereof, copies
of all statements, reports and other information any Loan Party sends to any
holders of its Indebtedness or its securities or files with the SEC or any
national (domestic or foreign) securities exchange;
(xiv) promptly upon receipt thereof, copies of all financial
reports (including, without limitation, management letters), if any, submitted
to any Loan Party by its auditors in connection with any annual or interim audit
of the books thereof; and
(xv) promptly upon request, such other information
concerning the condition or operations, financial or otherwise, of any Loan
Party as any Agent may from time to time may reasonably request.
(b) Additional Guaranties and Collateral Security. Cause:
(i) each Subsidiary of any Loan Party not in existence on
the Effective Date, to execute and deliver to the Collateral Agent promptly and
in any event within three days after the formation, acquisition or change in
status thereof (A) a Guaranty guaranteeing the Obligations, (B) a Security
Agreement, (C) if such Subsidiary has any Subsidiaries which are Unrestricted
Subsidiaries (as defined in the Indenture), a Pledge Agreement together with (x)
certificates evidencing all of the Capital Stock of any Person owned by such
Subsidiary, (y) undated stock powers executed in blank with signature
guaranteed, and (z) such opinion of counsel and such approving certificate of
such Subsidiary as the Collateral Agent may reasonably request in respect of
complying with any legend on any such certificate or any other matter relating
to such shares, (D) one or more Mortgages creating on the real property of such
Subsidiary a perfected, first priority Lien on such real property (subject only
to such Liens as may exist as of the date of the acquisition of such Subsidiary
and not created in anticipation of such acquisition), a Title Insurance Policy
covering such real property, a current ALTA survey thereof and a surveyor's
certificate, each in form and substance satisfactory to the Collateral Agent,
together with such other agreements, instruments and documents as the Collateral
Agent may require whether comparable to the documents required under Section
7.01(o) or otherwise, and (E) such other agreements, instruments, approvals,
legal opinions or other documents reasonably requested by the Collateral Agent
in order to create, perfect, establish the first priority of (subject only to
such Liens as may exist as of the date of the acquisition of such Subsidiary and
not created in anticipation of such acquisition) or otherwise protect any Lien
purported to be covered by any such Security Agreement, Pledge Agreement or
Mortgage or otherwise to effect the intent that such Subsidiary shall become
bound by all of the terms, covenants and agreements contained in the Loan
Documents and that all property and assets of such Subsidiary shall become
Collateral for the Obligations; and
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(ii) each owner of the Capital Stock of any such Subsidiary
which is an Unrestricted Subsidiary (as defined in the Indenture) to execute and
deliver promptly and in any event within three days after the formation or
acquisition of such Subsidiary a Pledge Agreement in form and substance
satisfactory to the Collateral Agent, together with (A) certificates evidencing
all of the Capital Stock of such Subsidiary, (B) undated stock powers or other
appropriate instruments of assignment executed in blank with signature
guaranteed, (C) such opinion of counsel and such approving certificate of such
Subsidiary as the Collateral Agent may reasonably request in respect of
complying with any legend on any such certificate or any other matter relating
to such shares and (D) such other agreements, instruments, approvals, legal
opinions or other documents requested by the Collateral Agent;
(c) Compliance with Laws, Etc. Comply, and cause each of their
Subsidiaries to comply, in all material respects with all applicable laws,
rules, regulations and orders (including, without limitation, all Environmental
Laws), such compliance to include, without limitation, (i) paying before the
same become delinquent all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or upon any of its properties, and
(ii) paying all lawful claims which if unpaid might become a Lien or charge upon
any of its properties, except to the extent contested in good faith by proper
proceedings which stay the imposition of any penalty, fine or Lien resulting
from the non-payment thereof and with respect to which adequate reserves have
been set aside for the payment thereof.
(d) Preservation of Existence, Etc. Maintain and preserve, and
cause each of their Subsidiaries to maintain and preserve, their existence,
rights and privileges, and become or remain duly qualified and in good standing
in each jurisdiction in which the character of the properties owned or leased by
them or in which the transaction of their business makes such qualification
necessary.
(e) Keeping of Records and Books of Account. Keep, and cause
each of their Subsidiaries to keep, adequate records and books of account, with
complete entries made in accordance with GAAP.
(f) Inspection Rights. Permit, and cause each of their
Subsidiaries to permit, the Agents or any agents or representatives thereof at
any time and from time to time during normal business hours, at the expense of
the Borrower, to examine and make copies of and abstracts from their records and
books of account, to visit and inspect their properties, to verify materials,
leases, notes, accounts receivable, deposit accounts and other assets of the
Loan Parties and their Subsidiaries, to conduct audits, physical counts,
valuations, appraisals, environmental assessments or examinations and to discuss
their affairs, finances and accounts with any of the directors, officers,
managerial employees, independent accountants or other representatives thereof.
The Borrower agrees to pay the reasonable cost of such audit, appraisal,
assessment or examination.
(g) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of their Subsidiaries to maintain and preserve, all of their
properties which are necessary or useful in the proper conduct of their business
in good working order and condition, ordinary wear and tear excepted, and
comply, and cause each of their Subsidiaries to comply, at all times with the
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provisions of all leases to which each of them is a party as lessee or under
which each of them occupies property, so as to prevent any loss or forfeiture
thereof or thereunder.
(h) Maintenance of Insurance. Maintain, and cause each of their
Subsidiaries to maintain, insurance with responsible and reputable insurance
companies or associations (including, without limitation, comprehensive general
liability, hazard, rent and business interruption insurance) with respect to
their properties (including all real properties leased or owned by them) and
business, in such amounts and covering such risks as is required by any
Governmental Authority having jurisdiction with respect thereto or as is carried
generally in accordance with sound business practice by companies in similar
businesses similarly situated and in any event in amount, adequacy and scope
reasonably satisfactory to the Collateral Agent. All policies covering the
Collateral are to be made payable to the Collateral Agent for the benefit of the
Lenders, as its interests may appear, in case of loss, under a standard
non-contributory "lender" or "secured party" clause and are to contain such
other provisions as the Collateral Agent may require to fully protect the
Lenders' interest in the Collateral and to any payments to be made under such
policies. All certificates of insurance are to be delivered to the Collateral
Agent and the policies are to be premium prepaid, with the loss payable and
additional insured endorsement in favor of Collateral Agent and such other
Persons as the Collateral Agent may designate from time to time, and shall
provide for not less than 30 days' prior written notice to the Collateral Agent
of the exercise of any right of cancellation. If the Loan Parties or any of
their Subsidiaries fail to maintain such insurance, the Collateral Agent may
arrange for such insurance, but at the Borrower's expense and without any
responsibility on the Collateral Agent's part for obtaining the insurance, the
solvency of the insurance companies, the adequacy of the coverage, or the
collection of claims. Upon the occurrence of an Event of Default, the Collateral
Agent shall have the sole right, in the name of the Lenders, the Loan Parties
and their Subsidiaries, to file claims under any insurance policies, to receive,
receipt and give acquittance for any payments that may be payable thereunder,
and to execute any and all endorsements, receipts, releases, assignments,
reassignments or other documents that may be necessary to effect the collection,
compromise or settlement of any claims under any such insurance policies.
(i) Obtaining of Permits, Etc. Obtain, maintain and preserve,
and cause each of their Subsidiaries to obtain, maintain and preserve, all
material permits, licenses, authorizations, approvals, entitlements and
accreditations which are necessary or useful in the proper conduct of its
business and become or remain, and cause each of their Subsidiaries to become or
remain, duly qualified and in good standing in each jurisdiction in which the
character of the properties owned or leased by it or in which the transaction of
its business makes such qualification necessary.
(j) Environmental. (i) Keep any property either owned or
operated by them or any of their Subsidiaries free of any Environmental Liens;
(ii) comply, and cause their Subsidiaries to comply, in all material respects
with Environmental Laws and provide to the Collateral Agent documentation of
such compliance which the Collateral Agent reasonably requests; (iii)
immediately notify the Agents of any Release of a Hazardous Material in excess
of any reportable quantity from or onto property owned or operated by the Loan
Parties or any of their Subsidiaries and take any Remedial Actions required to
xxxxx said Release; (iv) promptly provide
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the Agents with written notice within 10 days of the receipt of any of the
following: (A) notice that an Environmental Lien has been filed against any
property of any Loan Party or any of its Subsidiaries; (B) commencement of any
Environmental Action or notice that an Environmental Action will be filed
against any Loan Party or any of its Subsidiaries; and (C) notice of a
violation, citation or other administrative order which could have a Material
Adverse Effect and (v) defend, indemnify and hold harmless the Agents and the
Lenders and their transferees, and their respective employees, agents, officers
and directors, from and against any claims, demands, penalties, fines,
liabilities, settlements, damages, costs or expenses (including, without
limitation, attorney and consultant fees, investigation and laboratory fees,
court costs and litigation expenses) arising out of (A) the presence, disposal,
release or threatened release of any Hazardous Materials on any property at any
time owned or occupied by any Loan Party or any of its Subsidiaries (or its
respective predecessors in interest or title), (B) any personal injury
(including wrongful death) or property damage (real or personal) arising out of
or related to such Hazardous Materials, (C) any investigation, lawsuit brought
or threatened, settlement reached or government order relating to such Hazardous
Materials and/or (D) any violation of any Environmental Law.
(k) Further Assurances. Take such action and execute,
acknowledge and deliver, and cause each of their Subsidiaries to take such
action and execute, acknowledge and deliver, at their sole cost and expense,
such agreements, instruments or other documents as each Agent may require from
time to time in order (i) to carry out more effectively the purposes of this
Agreement and the other Loan Documents, (ii) to subject to valid and perfected
first priority Liens any of the Collateral or any other property of the Loan
Parties and their Subsidiaries other than property pledged to the Trustee under
the Indenture, subject, however, to Liens senior in priority which are Permitted
Liens, (iii) to establish and maintain the validity and effectiveness of any of
the Loan Documents and the validity, perfection and priority of the Liens
intended to be created thereby, and (iv) to better assure, convey, grant,
assign, transfer and confirm unto each Agent the rights now or hereafter
intended to be granted to the Agents, the Lenders and the L/C Issuer under this
Agreement or any other Loan Document.
(l) Change in Collateral; Collateral Records. (i) Give the
Collateral Agent not less than 30 days' prior written notice of any change in
the location of any Collateral, other than to locations set forth on Schedule
7.01(l) and with respect to which the Collateral Agent has filed financing
statements and otherwise fully perfected its Liens thereon, (ii) advise the
Collateral Agent promptly, in sufficient detail, of any material adverse change
relating to the type, quantity or quality of the Collateral or the Lien granted
thereon and (iii) execute and deliver, and cause each of their Subsidiaries to
execute and deliver, to the Collateral Agent for the benefit of the Lenders from
time to time, solely for the Collateral Agent's convenience in maintaining a
record of Collateral, such written statements and schedules as the Collateral
Agent may reasonably require, designating, identifying or describing the
Collateral.
(m) Landlord Waivers; Collateral Access Agreements. Obtain at
the time any Loan Party enters into a lease for real property not occupied on
the Effective Date or delivers possession of Collateral to Persons that did not
have possession of Collateral on the Effective Date a landlord's waiver from the
landlord of such real property (which waiver may be
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contained in such lease) or a collateral access agreement from the Person that
has possession of such Collateral, in form and substance reasonably satisfactory
to the Collateral Agent.
(n) Subordination. Cause all Indebtedness and other obligations
now or hereafter owed by any Loan Party to any of its Affiliates (prior to
Hornschuch becoming a wholly-owned Subsidiary of the Parent, other than
Hornschuch), to be subordinated in right of payment and security to the
Indebtedness and other Obligations owing to the Agents and the Lenders in
accordance with a subordination agreement in form and substance satisfactory to
the Agents.
(o) After Acquired Real Property. Upon the acquisition by any
Loan Party or any of its Subsidiaries after the date hereof of any interest
(whether fee or leasehold) in any real property (wherever located) (each such
interest being an "After Acquired Property") (x) with a Current Value (as
defined below) in excess of $100,000 in the case of a fee interest, or (y)
requiring the payment of annual rent exceeding in the aggregate $36,000 in the
case of leasehold interest, immediately so notify the Collateral Agent, setting
forth with specificity a description of the interest acquired, the location of
the real property, any structures or improvements thereon and either an
appraisal or such Loan Party's good-faith estimate of the current value of such
real property (for purposes of this Section, the "Current Value"). The
Collateral Agent shall notify such Loan Party whether it intends to require a
Mortgage and the other documents referred to below or in the case of leasehold,
a leasehold Mortgage or landlord's waiver (pursuant to Section 7.01(m) hereof).
Upon receipt of such notice requesting a Mortgage, the Person which has acquired
such After Acquired Property shall immediately furnish to the Collateral Agent
the following, each in form and substance satisfactory to the Collateral Agent:
(i) a Mortgage and an Environmental Indemnity Agreement with respect to such
real property and related assets located at the After Acquired Property, each
duly executed by such Person and in recordable form; (ii) evidence of the
recording of the Mortgage referred to in clause (i) above in such office or
offices as may be necessary or, in the opinion of the Collateral Agent,
desirable to create and perfect a valid and enforceable first priority lien on
the property purported to be covered thereby or to otherwise protect the rights
of the Agents and the Lenders thereunder, (iii) a Title Insurance Policy, (iv) a
survey of such real property, certified to the Collateral Agent and to the
issuer of the Title Insurance Policy by a licensed professional survey or
reasonably satisfactory to the Collateral Agent, (v) Phase I environmental
assessment reports with respect to such real property, certified to the
Collateral Agent by a company reasonably satisfactory to the Collateral Agent,
(vi) in the case of a leasehold interest, a certified copy of the lease between
the landlord and such Person with respect to such real property in which such
Person has a leasehold interest, and the certificate of occupancy with respect
thereto, (vii) in the case of a leasehold interest, an attornment and
nondisturbance agreement between the landlord (and any fee mortgagee) with
respect to such real property and the Collateral Agent, and (viii) such other
documents or instruments (including guarantees and opinions of counsel) as the
Collateral Agent may reasonably require. The Loan Parties shall pay all fees and
expenses, including reasonable attorneys' fees and expenses, and all title
insurance charges and premiums, in connection with their obligations under this
Section 7.01(o).
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(p) Fiscal Year. Cause the Fiscal Year of the Parent and its
Subsidiaries to end on March 31 of each calendar year unless the Agents consent
to a change in such Fiscal Year (and appropriate related changes to this
Agreement).
(q) Borrowing Base. Maintain all Revolving Loans and Letter of
Credit Obligations in compliance with the then current Borrowing Base.
(r) XXX Indenture. On or before July 6, 2000, terminate the XXX
Indenture Documents and all related documents, and cause the XXX Trustee to
reassign to the Borrower any interest in the Collateral subject to the XXX
Indenture. Promptly after the Effective Date, take all action necessary to
comply with the first sentence of this Section 7.01(r).
(s) Environmental Remediation. Within 60 days of the Effective
Date, provide to the Collateral Agent an action plan to address any recognized
environmental conditions noted by Xxxxxxx Xxxxxx in its initial site assessment
of the Facility, dated May 2, 2000, and within 120 days of the Effective Date,
or such other time reasonably satisfactory to the Collateral Agent, provide the
Collateral Agent with evidence of completion of all such action in form and
substance reasonably satisfactory to the Collateral Agent.
(t) CIGNA Indebtedness. Within 120 days after the Effective
Date, amend the Amended and Restated Payment and Deferral Agreement, dated as of
September 23, 1999, by and among the Parent, the Borrower and each of the
Holders identified and listed on Schedule A thereto, to provide for the payment
by the Loan Parties of the New Settlement Amount (as defined therein) by
delivery to the Holders of Capital Stock of the Parent.
SECTION 7.02. Negative Covenants. So long as any principal of or
interest on any Loan, Reimbursement Obligation, Letter of Credit Obligation or
any other Obligation (whether or not due) shall remain unpaid or any Lender
shall have any Commitment hereunder, the Loan Parties shall not, unless the
Required Lenders shall otherwise consent in writing:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of their Subsidiaries to create, incur, assume or suffer to exist any
Lien upon or with respect to any of their properties, whether now owned or
hereafter acquired, to file or suffer to exist under the Uniform Commercial Code
or any similar law or statute of any jurisdiction, a financing statement (or the
equivalent thereof) that names any Loan Party or any of its Subsidiaries as
debtor, to sign or suffer to exist any security agreement authorizing any
secured party thereunder to file such financing statement (or the equivalent
thereof), to sell any of its property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable) with recourse to any Loan Party or any
of its Subsidiaries or assign or otherwise transfer, or permit any of its
Subsidiaries to assign or otherwise transfer, any account or other right to
receive income, other than Permitted Liens.
(b) Indebtedness. Create, incur, assume, guarantee or suffer to
exist, or otherwise become or remain liable with respect to, or permit any of
their Subsidiaries to create, incur, assume, guarantee or suffer to exist or
otherwise become or remain liable with respect to, any Indebtedness other than
Permitted Indebtedness.
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(c) Fundamental Changes.
(i) Wind-up, liquidate or dissolve (or permit or suffer any
Subsidiary thereof) or merge, consolidate or amalgamate with any Person, or
agree to do any of the foregoing or permit any of their Subsidiaries to do any
of the foregoing, provided that any wholly-owned Subsidiary of any Loan Party
(other than the Borrower) may be merged into such Loan Party or another such
wholly-owned Subsidiary of such Loan Party, or may consolidate with another such
wholly-owned Subsidiary of such Loan Party, so long as (A) no other provision of
this Agreement would be violated thereby, (B) such Loan Party gives the Agents
at least 60 days' prior written notice of such merger or consolidation, (C) no
Default or Event of Default shall have occurred and be continuing either before
or after giving effect to such transaction, (D) the Lenders' rights in any
Collateral, including, without limitation, the existence, perfection and
priority of any Lien thereon, are not adversely affected by such merger or
consolidation and (E) the surviving Subsidiary, if any, is a party to a Guaranty
and Security Agreement and the Capital Stock of which Subsidiary is the subject
of a Pledge Agreement, in each case which is in full force and effect on the
date of and immediately after giving effect to such merger or consolidation.
(ii) Convey, sell, lease or sublease, transfer or otherwise
dispose of, whether in one transaction or a series of related transactions, all
or any part of their business, property or assets, whether now owned or
hereafter acquired, or agree to do any of the foregoing or permit any of their
Subsidiaries to do any of the foregoing, provided that any of the Loan Parties
and their Subsidiaries may (A) sell Inventory in the ordinary course of
business, (B) dispose of obsolete or worn-out equipment in the ordinary course
of business, and (C) sell or otherwise dispose of other property or assets for
cash in an aggregate amount not less than the fair market value of such property
or assets, provided that the Net Cash Proceeds of such Dispositions do not
exceed $100,000 in the aggregate in any twelve-month period and are paid to the
Administrative Agent for the benefit of the Lenders pursuant to the terms of
Section 2.05(c)(v).
(iii) Purchase or otherwise acquire, whether in one
transaction or a series of related transactions, all or substantially all of the
assets of any Person (or any division thereof), or agree to do any of the
foregoing or permit any of their Subsidiaries to do any of the foregoing.
(d) Change in Nature of Business. Make, or permit any of their
Subsidiaries to make, any change in the nature of its business as carried on at
the date hereof.
(e) Loans, Advances, Investments, Etc. Make or commit or agree
to make any loan, advance guarantee of obligations, other extension of credit or
capital contributions to, or hold or invest in or commit or agree to hold or
invest in, or purchase or otherwise acquire or commit or agree to purchase or
otherwise acquire any shares of the Capital Stock, bonds, notes, debentures or
other securities of, or make or commit or agree to make any other investment in,
any other Person, or purchase or own any futures contract or otherwise become
liable for the purchase or sale of currency or other commodities at a future
date in the nature of a futures contract, or permit any of its Subsidiaries to
do any of the foregoing, except for: (i) Investments existing on the date
hereof, as set forth on Schedule 7.02(e) hereto, but not any
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increase in the amount thereof as set forth in such Schedule or any other
modification of the terms thereof, (ii) temporary loans and advances by any Loan
Party to its Subsidiaries, officers or directors and by such Subsidiaries,
officers or directors to such Loan Party, made in the ordinary course of
business and not exceeding in the aggregate for all such Persons at any one time
outstanding $10,000, (iii) Permitted Investments, (iv) trade credit extended in
the ordinary course of business, and (v) loans and advances to German Holdings
not to exceed in the aggregate $2,500,000 to facilitate the purchase of the
remaining Capital Stock of Hornschuch that German Holdings does not own on the
Effective Date and to pay other expenses that are due and payable by German
Holdings, including interest and principal, provided that (A) both before and
immediately after giving effect to such purchase (x) no Default or Event of
Default exists and (y) Availability is not less than $750,000, and (B) the
Borrower enters into arrangements with German Holdings and Hornschuch in
connection with such loans and advances, such arrangements to be acceptable to
the Collateral Agent.
(f) Lease Obligations. Create, incur or suffer to exist, or
permit any of their Subsidiaries to create, incur or suffer to exist, any
obligations as lessee (i) for the payment of rent for any real or personal
property in connection with any sale and leaseback transaction, or (ii) for the
payment of rent for any real or personal property under leases or agreements to
lease other than (A) Capitalized Lease Obligations which would not cause the
aggregate amount of all obligations under Capitalized Leases entered into after
the Effective Date owing by the Loan Parties and their Subsidiaries in any
Fiscal Year to exceed the amounts set forth in subsection (h) of this Section
7.02, and (B) Operating Lease Obligations which would not cause the aggregate
amount of all Operating Lease Obligations owing by the Loan Parties and their
Subsidiaries in any Fiscal Year to exceed $2,000,000.
(g) Capital Expenditures. Make or commit or agree to make, or
permit any of their Subsidiaries to make or commit or agree to make, any Capital
Expenditure (by purchase or Capitalized Lease) that would cause the aggregate
amount of all such Capital Expenditures made by the Loan Parties and their
Subsidiaries to exceed $2,500,000 in any Fiscal Year.
(h) Restricted Payments. (i) Declare or pay any dividend or
other distribution, direct or indirect, on account of any Capital Stock of any
Loan Party or any of its Subsidiaries, now or hereafter outstanding, (ii) make
any repurchase, redemption, retirement, defeasance, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
Capital Stock of any Loan Party or any direct or indirect parent of any Loan
Party, now or hereafter outstanding, (iii) make any payment to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights for
the purchase or acquisition of shares of any class of Capital Stock of any Loan
Party, now or hereafter outstanding, (iv) return any of capital to any
shareholders or other equity holders of any Loan Party or any of its
Subsidiaries, or make any other distribution of property, assets, shares of
Capital Stock, warrants, rights, options, obligations or securities thereto as
such or (v) pay any management fees or any other fees or expenses (including the
reimbursement thereof by any Loan Party or any of its Subsidiaries) pursuant to
any management, consulting or other services agreement to any of the
shareholders or other equityholders of any Loan Party or any of its Subsidiaries
or other Affiliates, or to any
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other Subsidiaries or Affiliates of any Loan Party; provided, however, (i) the
Borrower may pay dividends to the Parent (A) in amounts necessary to pay
customary expenses of the Parent in the ordinary course of its business as a
public holding company (including salaries and related reasonable and customary
expenses incurred by employees of the Parent), (B) in amounts necessary to pay
taxes when due and owing by the Parent, (C) in amounts necessary to pay
principal and interest when due pursuant to the Indenture, (ii) any Subsidiaries
of the Borrower may pay dividends to the Borrower, and (iii) the Parent may pay
dividends in the form of common Capital Stock, provided that at the election of
the Collateral Agent which the Collateral Agent may and, upon the direction of
the Required Lenders, shall make by notice to the Loan Parties, no such payment
shall be made if an Event of Default shall have occurred and be continuing or
would result from the making of any such payment or, if either immediately
before or after giving effect to any such payment, the Loans and Letter of
Credit Obligations exceed the Borrowing Base; provided, further, that in the
absence of an Event of Default, the limitations contained in this Section
7.02(h) shall not apply to the Borrower to the extent such limitations are not
permitted by the terms of the Indenture.
(i) Federal Reserve Regulations. Permit any Loan or the proceeds
of any Loan under this Agreement to be used for any purpose that would cause
such Loans to be margin loans under the provisions of Regulation T, U or X of
the Board.
(j) Transactions with Affiliates. Enter into, renew, extend or
be a party to, or permit any of their Subsidiaries to enter into, renew, extend
or be a party to any transaction or series of related transactions (including,
without limitation, the purchase, sale, lease, transfer or exchange of property
or assets of any kind or the rendering of services of any kind) with any
Affiliate, except (i) in the ordinary course of business in a manner and to an
extent consistent with past practice and necessary or desirable for the prudent
operation of its business, for fair consideration and on terms no less favorable
to the Loan Parties or such Subsidiaries than would be obtainable in a
comparable arm's length transaction with a Person that is not an Affiliate
thereof, (ii) transactions among the Loan Parties, and (iii) transactions
permitted under Section 7.02(e) of this Agreement.
(k) Limitations on Dividends and Other Payment Restrictions
Affecting Subsidiaries. Create or otherwise cause, incur, assume, suffer or
permit to exist or become effective any consensual encumbrance or restriction of
any kind on the ability of any of Subsidiaries of the Borrower (i) to pay
dividends or to make any other distribution on any shares of Capital Stock of
such Subsidiary owned by the Borrower or any of its Subsidiaries, (ii) to pay or
prepay or to subordinate any Indebtedness owed to the Borrower or any of its
Subsidiaries, (iii) to make loans or advances to the Borrower or any of its
Subsidiaries or (iv) to transfer any of its property or assets to the Borrower
or any of its Subsidiaries, or permit any of its Subsidiaries to do any of the
foregoing; provided, however, that nothing in any of clauses (i) through (iv) of
this Section 7.02(k) shall prohibit or restrict:
(A) this Agreement and the other Loan Documents;
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(B) any agreements in effect on the date of this Agreement
and described on Schedule 7.02(k);
(C) any applicable law, rule or regulation (including,
without limitation, applicable currency control laws and applicable state
corporate statutes restricting the payment of dividends in certain
circumstances);
(D) in the case of clause (iv) any agreement setting forth
customary restrictions on the subletting, assignment or transfer of any property
or asset that is a lease, license, conveyance or contract of similar property or
assets; or
(E) in the case of clause (iv) any holder of a Permitted
Lien from restricting on customary terms the transfer of any property or assets
subject thereto.
(l) Limitation on Issuance of Capital Stock. Permit any
Subsidiaries of the Parent to issue or sell or enter into any agreement or
arrangement for the issuance and sale of any shares of its Capital Stock, any
securities convertible into or exchangeable for its Capital Stock or any
warrants.
(m) Modifications of Indebtedness, Organizational Documents and
Certain Other Agreements; Etc. (i) Amend, modify or otherwise change (or permit
the amendment, modification or other change in any manner of) any of the
provisions of any Indebtedness of the Loan Parties or any of their Subsidiaries
or of any instrument or agreement (including, without limitation, any purchase
agreement, indenture, loan agreement or security agreement) relating to any such
Indebtedness if such amendment, modification or change would shorten the final
maturity or average life to maturity of, or require any payment to be made
earlier than the date originally scheduled on, such Indebtedness, would increase
the interest rate applicable to such Indebtedness, or would change the
subordination provision, if any, of such Indebtedness, or would otherwise be
adverse to the issuer of such Indebtedness in any respect, (ii) except for (A)
the Obligations, the XXX Payment Amount and the WCLDC Loan and (B) the proceeds
of any judgment, award, settlement or other similar payment with respect to the
Rubbermaid Proceeds not required to be paid by the Borrower to the Loans
pursuant to Section 2.05(c)(vii), provided that, in the case of this subclause
(B), both before and immediately after giving effect to any such payment,
prepayment, redemption or other acquisition (x) no Default or Event of Default
exists, and (y) Availability is not less than $1,000,000, make any voluntary or
optional payment, prepayment, redemption or other acquisition for value of any
Indebtedness of the Loan Parties or any of their Subsidiaries (including,
without limitation, by way of depositing money or securities with the trustee
therefor before the date required for the purpose of paying any portion of such
Indebtedness when due), or refund, refinance, replace or exchange any other
Indebtedness for any such Indebtedness, or make any prepayment, redemption or
repurchase of any outstanding Indebtedness as a result of any asset sale (other
than with respect to assets in which the Trustee has been granted a lien to
secure the Senior Secured Notes), change of control, issuance and sale of debt
or equity securities or similar event, or give any notice with respect to any of
the foregoing, or (iii) amend, modify or otherwise change their certificate of
incorporation or bylaws (or other similar organizational documents), including,
without limitation, by the filing
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or modification of any certificate of designation, or any agreement or
arrangement entered into by them, with respect to any of their Capital Stock
(including any shareholders' agreement), or enter into any new agreement with
respect to any of their Capital Stock except any such amendments, modifications
or changes or any such new agreements or arrangements pursuant to this clause
(iii) that either individually or in the aggregate, could have a Material
Adverse Effect.
(n) Investment Company Act of 1940. Engage in any business,
enter into any transaction, use any securities or take any other action or
permit any of their Subsidiaries to do any of the foregoing, that would cause
them or any of their Subsidiaries to become subject to the registration
requirements of the Investment Company Act of 1940, as amended, by virtue of
being an "investment company" or a company "controlled" by an "investment
company" not entitled to an exemption within the meaning of such Act.
(o) Compromise of Accounts Receivable. Compromise or adjust any
Account Receivable (or extend the time of payment thereof) or grant any
discounts, allowances or credits or permit any of their Subsidiaries to do so
other than, provided no Default or Event of Default has occurred and is
continuing, in the ordinary course of business of the Loan Parties or their
Subsidiaries, as the case may be; provided, however, in no event shall any such
discount, allowance or credit exceed $100,000 in the aggregate and no such
extension of the time for payment extend beyond 60 days from the original due
date.
(p) Environmental. Permit the use, handling, generation,
storage, treatment, release or disposal of Hazardous Materials at any property
owned or leased by the Loan Parties or any of their Subsidiaries except in
compliance with Environmental Laws and so long as such use, handling,
generation, storage, treatment, release or disposal of Hazardous Materials does
not result in a Material Adverse Effect.
(q) Certain Agreements. Agree to any material amendment or other
material change to or material waiver of any of its rights under any Indenture
Document, XXX Indenture Document, Fleet Document, Intercompany Loan Document,
WCLDC Loan Document or any Material Contract.
SECTION 7.03. Financial Covenants.
(a) Leverage Ratio. Permit the ratio of Consolidated Funded
Indebtedness to Consolidated EBITDA of the Borrower and its Subsidiaries as of
the end of each period of four (4) consecutive fiscal quarters for which the
last quarter ends on a date set forth below to be greater than the applicable
ratio set forth below:
Fiscal Quarter End Leverage Ratio
------------------ --------------
June 30, 2000 2.70 to 1.0
September 30, 2000 2.50 to 1.0
December 31, 2000 2.25 to 1.0
March 31, 2001 2.00 to 1.0
June 30, 2001 2.00 to 1.0
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September 30, 2001 2.00 to 1.0
December 31, 2001 2.00 to 1.0
March 31, 2002 2.00 to 1.0
(b) Fixed Charge Coverage Ratio. Permit the Fixed Charge
Coverage Ratio for each period of four (4) consecutive fiscal quarters of the
Borrower and its Subsidiaries for which the last quarter ends on a date set
forth below to be less than the amount set forth opposite such date:
Fiscal Quarter End Fixed Charge Coverage Ratio
------------------ ---------------------------
June 30, 2000 0.58 to 1.0
September 30, 2000 0.65 to 1.0
December 31, 2000 0.72 to 1.0
March 31, 2001 0.77 to 1.0
June 30, 2001 0.86 to 1.0
September 30, 2001 0.88 to 1.0
December 31, 2001 0.89 to 1.0
March 31, 2002 0.92 to 1.0
(c) Consolidated EBITDA. Permit Consolidated EBITDA of the
Borrower and its Subsidiaries at the end of each fiscal quarter of the Borrower
and its Subsidiaries to be less than the applicable amount set forth below:
Fiscal Quarter Ending Consolidated EBITDA
--------------------- -------------------
June 30, 2000 $10,000,000
September 30, 2000 $11,500,000
December 31, 2000 $13,000,000
March 31, 2001 $14,500,000
June 30, 2001 $16,000,000
September 30, 2001 $16,000,000
December 31, 2001 $16,000,000
March 31, 2002 $16,000,000
ARTICLE VIII
MANAGEMENT, COLLECTION AND STATUS OF
ACCOUNTS RECEIVABLE AND OTHER COLLATERAL
SECTION 8.01. Collection of Accounts Receivable; Management of
Collateral. (a) On or prior to the Effective Date, the Borrower shall assist the
Administrative Agent in (i) establishing, and, during the term of this
Agreement, maintaining one or more lockboxes in the name of the Administrative
Agent and identified on Schedule 8.01 hereto (collectively, the "Lockboxes")
with the financial institutions set forth on Schedule 8.01 hereto or such other
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financial institutions selected by the Borrower and acceptable to the
Administrative Agent in its sole discretion (each being referred to as a
"Lockbox Bank"), and (ii) establishing, and during the term of this Agreement,
maintaining an account (a "Collection Account" and, collectively, the
"Collection Accounts") in the name of the Administrative Agent with each Lockbox
Bank. The Borrower shall irrevocably instruct their Account Debtors, with
respect to Accounts Receivable of the Borrower, to remit all payment to be made
by checks or other drafts to the Lockboxes and to remit all payments to be made
by wire transfer or by Automated Clearing House, Inc. payments as directed by
the Administrative Agent and shall instruct each Lockbox Bank to deposit all
amounts received in its Lockbox to the Collection Account at such Lockbox Bank
on the day received or, if such day is not a Business Day, on the next
succeeding Business Day. Until the Administrative Agent has advised the Borrower
to the contrary after the occurrence and during the continuance of an Event of
Default, the Borrower may and will enforce, collect and receive all amounts
owing on the Accounts Receivable of the Borrower for the Administrative Agent's
benefit and on the Administrative Agent's behalf, but at the Borrower's expense;
such privilege shall terminate, at the election of any Agent, upon the
occurrence and during the continuance of any Event of Default. All checks,
drafts, notes, money orders, acceptances, cash and other evidences of
Indebtedness received directly by the Borrower from any Account Debtor, as
proceeds from Accounts Receivable of the Borrower, or as proceeds of any other
Collateral, shall be held by the Borrower in trust for the Agents and the
Lenders and upon receipt be deposited by the Borrower in original form and no
later than the next Business Day after receipt thereof into a Collection
Account. The Borrower shall not commingle such collections with the Borrower's
own funds or the funds of any Subsidiary or Affiliate of the Borrower or with
the proceeds of any assets not included in the Collateral. The Administrative
Agent shall charge the Loan Account on the last day of each month with two (2)
collection days for all such collections. All funds received in the Collection
Account shall be sent by wire transfer or Automated Clearing House Inc. payment
to the Payment Office to be credited to the Administrative Agent's Account for
application at the end of each Business Day to reduce the then principal balance
of the Revolving Loans, conditional upon final payment to the Administrative
Agent. No checks, drafts or other instrument received by the Administrative
Agent shall constitute final payment to the Administrative Agent unless and
until such instruments have actually been collected.
(b) After the occurrence and during the continuance of an Event
of Default, the Collateral Agent may send a notice of assignment and/or notice
of the Lenders' security interest to any and all Account Debtors or third
parties holding or otherwise concerned with any of the Collateral, and
thereafter the Collateral Agent shall have the sole right to collect the
Accounts Receivable and/or take possession of the Collateral and the books and
records relating thereto. The Borrower shall not, without prior written consent
of the Collateral Agent, grant any extension of time of payment of any Account
Receivable, compromise or settle any Account Receivable for less than the full
amount thereof, release, in whole or in part, any Person or property liable for
the payment thereof, or allow any credit or discount whatsoever thereon, except,
in the absence of a continuing Event of Default, as permitted by Section
7.02(o).
(c) The Borrower hereby appoints each Agent or its designee on
behalf of such Agent as the Borrower's attorney-in-fact with power exercisable
during the continuance of any Event of Default to endorse the Borrower's name
upon any notes, acceptances, checks,
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drafts, money orders or other evidences of payment relating to the Accounts
Receivable, to sign the Borrower's name on any invoice or xxxx of lading
relating to any of the Accounts Receivable, drafts against Account Debtors with
respect to Accounts Receivable, assignments and verifications of Accounts
Receivable and notices to Account Debtors with respect to Accounts Receivables,
to send verification of Accounts Receivable, and, to notify the Postal Service
authorities to change the address for delivery of mail addressed to the Borrower
to such address as such Agent may designate and to do all other acts and things
necessary to carry out this Agreement. All acts of said attorney or designee are
hereby ratified and approved, and said attorney or designate shall not be liable
for any acts of omission or commission (other than acts or omissions
constituting gross negligence or willful misconduct), or for any error of
judgment or mistake of fact or law; this power being coupled with an interest is
irrevocable until all of the Loans, Reimbursement Obligations, Letter of Credit
Obligations and other Obligations under the Loan Documents are paid in full and
all of the Loan Documents are terminated.
(d) Nothing herein contained shall be construed to constitute
any Agent as agent of the Borrower for any purpose whatsoever, and the Agents
shall not be responsible or liable for any shortage, discrepancy, damage, loss
or destruction of any part of the Collateral wherever the same may be located
and regardless of the cause thereof (other than from acts or omissions of the
Agents constituting gross negligence or willful misconduct as determined by a
final judgment of a court of competent jurisdiction). The Agents shall not,
under any circumstance or in any event whatsoever, have any liability for any
error or omission or delay of any kind occurring in the settlement, collection
or payment of any of the Accounts Receivable or any instrument received in
payment thereof or for any damage resulting therefrom (other than acts or
omissions of the Agents constituting gross negligence or willful misconduct as
determined by a final judgment of a court of competent jurisdiction). The
Agents, by anything herein or in any assignment or otherwise, do not assume any
of the obligations under any contract or agreement assigned to any Agent and
shall not be responsible in any way for the performance by the Borrower of any
of the terms and conditions thereof.
(e) If any Account Receivable includes a charge for any tax
payable to any Governmental Authority, the Agents are hereby authorized (but in
no event obligated) in its discretion to pay the amount thereof to the proper
taxing authority for the Borrower's account and to charge the Borrower therefor.
The Borrower shall notify the Agents if any Account Receivable includes any
taxes due to any such Governmental Authority and, in the absence of such notice,
the Agents shall have the right to retain the full proceeds of such Account
Receivable and shall not be liable for any taxes that may be due by reason of
the sale and delivery creating such Account Receivable.
SECTION 8.02. Accounts Receivable Documentation. The Borrower will
at such intervals as the Agents may require, execute and deliver confirmatory
written assignments of the Accounts Receivable to the Agents and furnish such
further schedules and/or information as any Agent may require relating to the
Accounts Receivable, including, without limitation, sales invoices or the
equivalent, credit memos issued, remittance advises, reports and copies of
deposit slips and copies of original shipping or delivery receipts for all
merchandise sold. In addition, the Borrower shall notify the Agents of any
non-compliance in respect of the
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representations, warranties and covenants contained in Section 8.03. The items
to be provided under this Section 8.02 are to be in form reasonably satisfactory
to the Agents and are to be executed and delivered to the Agents from time to
time solely for their convenience in maintaining records of the Collateral. The
Borrower's failure to give any of such items to the Agents shall not affect,
terminate, modify or otherwise limit the Collateral Agent's Lien on the
Collateral. The Borrower shall not re-date any invoice or sale or make sales on
extended dating beyond that customary in the Borrower's industry, and shall not
re-xxxx any Accounts Receivable without promptly disclosing the same to the
Agents and providing the Agents with copy of such re-billing, identifying the
same as such. If the Borrower becomes aware of anything materially detrimental
to any of the Borrower's customers' credit, the Borrower will promptly advise
the Agents thereof.
SECTION 8.03. Status of Accounts Receivable and Other Collateral.
With respect to Collateral of any Loan Party at the time the Collateral becomes
subject to the Collateral Agent's Lien, each Loan Party covenants, represents
and warrants: (a) such Loan Party shall be the sole owner, free and clear of all
Liens except in the favor of the Agent for the benefit of the Lenders or
otherwise permitted hereunder, and fully authorized to sell, transfer, pledge
and/or grant a security interest in each and every item of said Collateral; (b)
each Account Receivable shall be a good and valid account representing an
undisputed bona fide indebtedness incurred or an amount indisputably owed by the
Account Debtor therein named, for a fixed sum as set forth in the invoice
relating thereto with respect to any absolute sale and delivery upon the
specified terms of goods sold or services rendered by the such Loan Party; (c)
no Account Receivable shall be subject to any defense, offset, counterclaim,
discount or allowance except as may be stated in the invoice relating thereto,
discounts and allowances as may be customary in such Loan Party's business and
as otherwise disclosed to the Agents, and each Account Receivable will be paid
when due; (d) none of the transactions underlying or giving rise to any Account
Receivable shall violate any applicable state or federal laws or regulations,
and all documents relating thereto shall be legally sufficient under such laws
or regulations and shall be legally enforceable in accordance with their terms;
(e) no agreement under which any deduction or offset of any kind, other than
normal trade discounts, may be granted or shall have been made by such Loan
Party at or before the time such Accounts Receivable is created; (f) all
agreements, instruments and other documents relating to any Account Receivable
shall be true and correct and in all material respects what they purport to be;
(g) all signatures and endorsements that appear on all material agreements,
instruments and other documents relating to Account Receivable shall be genuine
and all signatories and endorsers shall have full capacity to contract; (h) such
Loan Party shall maintain books and records pertaining to said Collateral in
such detail, form and scope as the Agents shall reasonably require; (i) such
Loan Party shall immediately notify the Agents if any accounts arise out of
contracts with the United States or any department, agency, or instrumentality
thereof and will execute any instruments and take any steps required by the
Agents in order that all monies due or to become due under any such contract
shall be assigned to the Collateral Agent and notice thereof given to the United
States Government under the Federal Assignment of Claims Act; (j) such Loan
Party will, immediately upon learning thereof, report to the Agents any material
loss or destruction of, or substantial damage to, any of the Collateral, and any
other matters affecting the value, enforceability or collectability of any of
the Collateral; (k) if any amount payable under or in connection with any
Account Receivable is
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evidenced by a promissory note or other instrument, such promissory note or
instrument shall be immediately pledged, endorsed, assigned and delivered to the
Collateral Agent for the benefit of the Lenders as additional Collateral; (l)
such Loan Party shall not re-date any invoice or sale or make sales on extended
dating beyond that which is customary in the ordinary course of its business and
in the industry; (m) such Loan Party shall conduct a physical count of the
Inventory at such intervals as the Collateral Agent may request and such Loan
Party shall promptly supply the Agents with a copy of such count accompanied by
a report of the value (based on the lower of cost (on a first in first out
basis) and market value) of such Inventory; and (n) such Loan Party is not and
shall not be entitled to pledge the Agents' or the Lenders' credit on any
purchases or for any purpose whatsoever.
SECTION 8.04. Collateral Custodian. Upon the occurrence and during
the continuance of any Default or Event of Default, the Collateral Agent may at
any time and from time to time employ and maintain on the premises of any Loan
Party a custodian selected by the Collateral Agent who shall have full authority
to do all acts necessary to protect the Agents' and the Lenders' interests. Each
Loan Party hereby agrees to, and to cause its Subsidiaries to, cooperate with
any such custodian and to do whatever the Collateral Agent may reasonably
request to preserve the Collateral. All costs and expenses incurred by the
Collateral Agent by reason of the employment of the custodian shall be the
responsibility of the Borrower and charged to the Loan Account.
ARTICLE IX
EVENTS OF DEFAULT
SECTION 9.01. Events of Default. If any of the following Events of
Default shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of or interest
on any Loan, any Collateral Agent Advance, any Reimbursement Obligation or any
fee, indemnity or other amount payable under this Agreement or any other Loan
Document when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise);
(b) any representation or warranty made or deemed made by or on
behalf of any Loan Party or by any officer of the foregoing under or in
connection with any Loan Document or under or in connection with any report,
certificate, or other document delivered to the Agents, the L/C Issuer or the
Lenders pursuant to any Loan Document shall have been incorrect in any material
respect when made or deemed made;
(c) any Loan Party shall fail to perform or comply with any
covenant or agreement contained in Article VII or Article VIII, or any Loan
Party shall fail to perform or comply with any covenant or agreement contained
in Section 5 of any Security Agreement to which it is a party, Section 6 of any
Pledge Agreement to which it is a party or Section 5 of any Mortgage to which it
is a party;
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(d) any Loan Party shall fail to perform or comply with any
other term, covenant or agreement contained in any Loan Document to be performed
or observed by it and, except as set forth in subsections (a), (b) and (c) of
this Section 9.01, such failure, if capable of being remedied, shall remain
unremedied for 15 days after the earlier of the date a senior officer of any
Loan Party becomes aware of such failure and the date written notice of such
default shall have been given by the Collateral Agent to such Loan Party;
(e) any Loan Party shall fail to pay any principal of or
interest on any of its Indebtedness (excluding Indebtedness evidenced by the
Notes) in excess of $200,000, or any interest or premium thereon, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such Indebtedness, or
any other default under any agreement or instrument relating to any such
Indebtedness, or any other event, shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such Indebtedness
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), redeemed, purchased or defeased
or an offer to prepay, redeem, purchase or defease such Indebtedness shall be
required to be made, in each case prior to the stated maturity thereof;
(f) any Loan Party (i) shall institute any proceeding or
voluntary case seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for any such Person or for any substantial
part of its property, (ii) shall be generally not paying its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
(iii) shall make a general assignment for the benefit of creditors, or (iv)
shall take any action to authorize or effect any of the actions set forth above
in this subsection (f);
(g) any proceeding shall be instituted against any Loan Party
seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, custodian or other similar official for any
such Person or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of 30 days or any
of the actions sought in such proceeding (including, without limitation, the
entry of an order for relief against any such Person or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur;
(h) any provision of any Loan Document shall at any time for any
reason (other than pursuant to the express terms thereof) cease to be valid and
binding on or enforceable against any Loan Party intended to be a party thereto,
or the validity or enforceability thereof shall be contested by any party
thereto, or a proceeding shall be commenced by any Loan Party or any
Governmental Authority having jurisdiction over any of them, seeking to
establish the
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invalidity or unenforceability thereof, any Loan Party shall deny
in writing that it has any liability or obligation purported to be created under
any Loan Document;
(i) any Security Agreement, any Mortgage or any other security
document, after delivery thereof pursuant hereto, shall for any reason fail or
cease to create a valid and perfected and, except to the extent permitted by the
terms hereof or thereof, first priority Lien in favor of the Collateral Agent
for the benefit of the Lenders on any Collateral purported to be covered
thereby;
(j) one or more judgments or orders for the payment of money
exceeding $200,000 in the aggregate shall be rendered against any Loan Party and
remain unsatisfied and either (i) enforcement proceedings shall have been
commenced by any creditor upon any such judgment or order, or (ii) there shall
be a period of 10 consecutive days after entry thereof during which a stay of
enforcement of any such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; provided, however, that any such judgment or
order shall not give rise to an Event of Default under this subsection (j) if
and for so long as (A) the amount of such judgment or order is covered by a
valid and binding policy of insurance between the defendant and the insurer
covering full payment thereof and (B) such insurer has been notified, and has
not disputed the claim made for payment, of the amount of such judgment or
order;
(k) any Loan Party or any of its ERISA Affiliates shall have
made a complete or partial withdrawal from a Multiemployer Plan, and, as a
result of such complete or partial withdrawal any Loan Party or such ERISA
Affiliate incurs a withdrawal liability in an annual amount exceeding $100,000;
or a Multiemployer Plan enters reorganization status under Section 4241 of
ERISA, and, as a result thereof such Loan Party's, or such ERISA Affiliate's
annual contribution requirement with respect to such Multiemployer Plan
increases in an annual amount exceeding $100,000;
(l) any Termination Event with respect to any Employee Plan
shall have occurred, and, 30 days after notice thereof shall have been given to
any Loan Party by the Agent, (i) such Termination Event (if correctable) shall
not have been corrected, and (ii) the then current value of such Employee Plan's
vested benefits exceeds the then current value of assets allocable to such
benefits in such Employee Plan by more than $100,000 (or, in the case of a
Termination Event involving liability under Section 409, 502(i), 502(l), 515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of
the Code, the liability is in excess of such amount);
(m) a Change of Control shall have occurred; or
(n) an event or development occurs which has a Material Adverse
Effect, then, and in any such event, the Collateral Agent may, and shall at the
request of the Required Lenders, by notice to the Borrower, (i) terminate the
Commitments, whereupon the Commitments shall terminate immediately, (ii) declare
all Loans and Reimbursement Obligations then outstanding to be due and payable,
whereupon the aggregate principal of such Loans and Reimbursement Obligations,
all accrued and unpaid interest thereon, all fees and all other amounts
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payable under this Agreement shall become due and payable immediately, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by each Loan Party and (iii) exercise any and all of its
other rights and remedies under applicable law, hereunder and under the other
Loan Documents; provided, however, that upon the occurrence of any Event of
Default described in subsection (f) or (g) of this Section 9.01, without any
notice to any Loan Party or any other Person or any act by any Agent or any
Lender, the Commitments shall automatically terminate and the Loans and
Reimbursement Obligations then outstanding, together with all accrued and unpaid
interest thereon, all fees and all other amounts due under this Agreement shall
become due and payable automatically and immediately, without presentment,
demand, protest or notice of any kind, all of which are expressly waived by each
Loan Party. Upon demand by the Administrative Agent after the occurrence and
during the continuation of any Event of Default, the Borrower shall deposit with
the Administrative Agent with respect to the Support Letter of Credit cash in an
amount equal to the greatest amount for which the Support Letter of Credit may
be drawn. Such deposits shall be held by the Administrative Agent in a joint
non-interest bearing account maintained at the Payment Office of the
Administrative Agent as security for, and to provide for the payment of, the
Letter of Credit Obligations.
ARTICLE X
AGENT
SECTION 10.01. Appointment. Each Lender (and each subsequent holder
of any Note by its acceptance thereof) hereby irrevocably appoints and
authorizes the Administrative Agent and the Collateral Agent to perform the
duties of each such Agent as set forth in this Agreement including: (i) to
receive on behalf of each Lender any payment of principal of or interest on the
Notes outstanding hereunder and all other amounts accrued hereunder for the
account of the Lenders and paid to such Agent, and, subject to Section 2.02 of
this Agreement, to distribute promptly to each Lender its Pro Rata Share of all
payments so received (ii) to distribute to each Lender copies of all material
notices and agreements received by such Agent and not required to be delivered
to each Lender pursuant to the terms of this Agreement, provided that the Agents
shall not have any liability to the Lenders for the Agents' inadvertent failure
to distribute any such notices or agreements to the Lenders and (iii) subject to
Section 10.03 of this Agreement, to take such action as such Agent deems
appropriate on its behalf to administer the Loans and the Loan Documents and to
exercise such other powers delegated to such Agent by the terms hereof or the
Loan Documents (including, without limitation, the power to give or to refuse to
give notices, waivers, consents, approvals and instructions and the power to
make or to refuse to make determinations and calculations) together with such
powers as are reasonably incidental thereto to carry out the purposes hereof and
thereof. As to any matters not expressly provided for by this Agreement and the
other Loan Documents (including, without limitation, enforcement or collection
of the Notes), the Agents shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Required Lenders, and such instructions of the Required
Lenders shall be binding upon all Lenders and all holders of Notes; provided,
however, that the L/C Issuer shall not be required to refuse to honor a drawing
under the Support Letter of
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Credit and the Agents shall not be required to take any action which, in the
reasonable opinion of any Agent, exposes such Agent to liability or which is
contrary to this Agreement or any Loan Document or applicable law.
SECTION 10.02. Nature of Duties. The Agents shall have no duties or
responsibilities except those expressly set forth in this Agreement or in the
Loan Documents. The duties of the Agents shall be mechanical and administrative
in nature. The Agents shall not have by reason of this Agreement or any Loan
Document a fiduciary relationship in respect of any Lender. Nothing in this
Agreement or any of the Loan Documents, express or implied, is intended to or
shall be construed to impose upon the Agents any obligations in respect of this
Agreement or any of the Loan Documents except as expressly set forth herein or
therein. Each Lender shall make its own independent investigation of the
financial condition and affairs of the Loan Parties in connection with the
making and the continuance of the Loans hereunder and shall make its own
appraisal of the creditworthiness of the Loan Parties and the value of the
Collateral, and the Agents shall have no duty or responsibility, either
initially or on a continuing basis, to provide any Lender with any credit or
other information with respect thereto, whether coming into its possession
before the initial Loan hereunder or at any time or times thereafter, provided
that, upon the reasonable request of a Lender, each Agent shall provide to such
Lender any documents or reports delivered to such Agent by the Loan Parties
pursuant to the terms of this Agreement or any Loan Document. If any Agent seeks
the consent or approval of the Required Lenders to the taking or refraining from
taking any action hereunder, such Agent shall send notice thereof to each
Lender. Each Agent shall promptly notify each Lender any time that the Required
Lenders have instructed such Agent to act or refrain from acting pursuant
hereto.
SECTION 10.03. Rights, Exculpation, Etc. The Agents and their
directors, officers, agents or employees shall not be liable for any action
taken or omitted to be taken by them under or in connection with this Agreement
or the other Loan Documents, except for their own gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. Without limiting the generality of the foregoing, the Agents (i)
may treat the payee of any Note as the holder thereof until the Agents receive
written notice of the assignment or transfer thereof, pursuant to Section 12.07
hereof, signed by such payee and in form satisfactory to the Agent; (ii) may
consult with legal counsel (including, without limitation, counsel to such Agent
or counsel to the Loan Parties), independent public accountants, and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel or
experts; (iii) make no warranty or representation to any Lender and shall not be
responsible to any Lender for any statements, certificates, warranties or
representations made in or in connection with this Agreement or the other Loan
Documents; (iv) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement or the other Loan Documents on the part of any Person, the existence
or possible existence of any Default or Event of Default, or to inspect the
Collateral or other property (including, without limitation, the books and
records) of any Person; (v) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or the other Loan Documents or any other instrument or
document furnished pursuant hereto or thereto; and (vi) shall not be deemed to
have made any representation or warranty regarding the existence, value or
collectability of the Collateral, the
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existence, priority or perfection of the Collateral Agent's Lien thereon, or any
certificate prepared by any Loan Party in connection therewith, nor shall the
Collateral Agent be responsible or liable to the Lenders for any failure to
monitor or maintain any portion of the Collateral. The Agents shall not be
liable for any apportionment or distribution of payments made in good faith
pursuant to Section 2.07(c), and if any such apportionment or distribution is
subsequently determined to have been made in error the sole recourse of any
Lender to whom payment was due but not made, shall be to recover from other
Lenders any payment in excess of the amount which they are determined to be
entitled. The Agents may at any time request instructions from the Lenders with
respect to any actions or approvals which by the terms of this Agreement or of
any of the Loan Documents the Agents are permitted or required to take or to
grant, and if such instructions are promptly requested, the Agents shall be
absolutely entitled to refrain from taking any action or to withhold any
approval under any of the Loan Documents until it shall have received such
instructions from the Required Lenders. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against any Agent as a result
of such Agent acting or refraining from acting under this Agreement, the Notes,
or any of the other Loan Documents in accordance with the instructions of the
Required Lenders.
SECTION 10.04. Reliance. Each Agent shall be entitled to rely upon
any written notices, statements, certificates, orders or other documents or any
telephone message believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the Loan Documents and its duties
hereunder or thereunder, upon advice of counsel selected by it.
SECTION 10.05. Indemnification. To the extent that any Agent is not
reimbursed and indemnified by any Loan Party, the Lenders will reimburse and
indemnify such Agent and the L/C Issuer from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, advances or disbursements of any kind or nature whatsoever
which may be imposed on, incurred by, or asserted against such Agent or the L/C
Issuer in any way relating to or arising out of this Agreement or any of the
Loan Documents or any action taken or omitted by such Agent or the L/C Issuer
under this Agreement or any of the Loan Documents, in proportion to each
Lender's Pro Rata Share, including, without limitation, advances and
disbursements made pursuant to Section 10.08; provided, however, that no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses, advances or
disbursements for which there has been a final judicial determination that such
resulted from any Agent's or the L/C Issuer's gross negligence or willful
misconduct. The obligations of the Lenders under this Section 10.05 shall
survive the payment in full of the Loans and the termination of this Agreement.
SECTION 10.06. Agents Individually. With respect to its Pro Rata
Share of the Total Commitment hereunder, the Loans made by it and the Notes
issued to or held by it, each Agent shall have and may exercise the same rights
and powers hereunder and is subject to the same obligations and liabilities as
and to the extent set forth herein for any other Lender or holder of a Note. The
terms "Lenders" or "Required Lenders" or any similar terms shall, unless the
context clearly otherwise indicates, include each Agent in its individual
capacity as a Lender or one of the Required Lenders. Each Agent and its
Affiliates may accept deposits from, lend money to, and
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generally engage in any kind of banking, trust or other business with the
Borrower as if it were not acting as an Agent pursuant hereto without any duty
to account to the Lenders.
SECTION 10.07. Successor Agent.
(a) Each Agent may resign from the performance of all its
functions and duties hereunder and under the other Loan Documents at any time by
giving at least thirty (30) Business Days' prior written notice to the Borrower
and each Lender. Such resignation shall take effect upon the acceptance by a
successor Agent of appointment pursuant to clauses (b) and (c) below or as
otherwise provided below.
(b) Upon any such notice of resignation, the Required Lenders
shall appoint a successor Agent who, in the absence of a continuing Event of
Default, shall be reasonably satisfactory to the Borrower. Upon the acceptance
of any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents. After any Agent's resignation hereunder as the Agent, the
provisions of this Article X shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement and the
other Loan Documents.
(c) If a successor Agent shall not have been so appointed within
said thirty (30) Business Day period, the retiring Agent, with the consent of
the other Agent and, if an Event of Default is not continuing, the Borrower,
shall then appoint a successor Agent who shall serve as Agent until such time,
if any, as the Required Lenders, with the consent of other Agent and, the
Borrower, if an Event of Default is not continuing, appoint a successor Agent as
provided above.
SECTION 10.08. Collateral Matters.
(a) The Collateral Agent may from time to time, during the
occurrence and continuance of an Event of Default, make such disbursements and
advances ("Collateral Agent Advances") which the Collateral Agent, in its sole
discretion, deems necessary or desirable to preserve or protect the Collateral
or any portion thereof, to enhance the likelihood or maximize the amount of
repayment by the Borrower of the Loans, Reimbursement Obligations, Letter of
Credit Obligations and other Obligations or to pay any other amount chargeable
to the Borrower pursuant to the terms of this Agreement, including, without
limitation, costs, fees and expenses as described in Section 12.05. The
Collateral Agent Advances shall be repayable on demand and be secured by the
Collateral. The Collateral Agent Advances shall not constitute Loans but shall
otherwise constitute Obligations hereunder. The Collateral Agent shall notify
each Lender and the Borrower in writing of each such Collateral Agent Advance,
which notice shall include a description of the purpose of such Collateral Agent
Advance. Without limitation to its obligations pursuant to Section 10.05, each
Lender agrees that it shall make available to the Collateral Agent, upon the
Collateral Agent's demand, in Dollars in immediately available funds, the amount
equal to such Lender's Pro Rata Share of each such Collateral Agent Advance. If
such funds are not made available to the Collateral Agent by such Lender the
Collateral Agent shall be entitled to recover
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such funds, on demand from such Lender together with interest thereon, for each
day from the date such payment was due until the date such amount is paid to the
Collateral Agent, at the Federal Funds Rate for three Business Days and
thereafter at the Reference Rate.
(b) The Lenders hereby irrevocably authorize the Collateral
Agent, at its option and in its discretion, to release any Lien granted to or
held by the Collateral Agent upon any Collateral upon termination of the Total
Commitments and payment and satisfaction of all Loans, Reimbursement
Obligations, Letter of Credit Obligations, and all other Obligations which have
matured and which the Collateral Agent has been notified in writing are then due
and payable; or constituting property being sold or disposed of in the ordinary
course of any Loan Party's business and in compliance with the terms of this
Agreement and the other Loan Documents; or constituting property in which the
Loan Parties owned no interest at the time the Lien was granted or at any time
thereafter; or if approved, authorized or ratified in writing by the Lenders.
Upon request by the Collateral Agent at any time, the Lenders will confirm in
writing the Collateral Agent's authority to release particular types or items of
Collateral pursuant to this Section 10.08(b).
(c) Without in any manner limiting the Collateral Agent's
authority to act without any specific or further authorization or consent by the
Lenders (as set forth in Section 10.08(b)), each Lender agrees to confirm in
writing, upon request by the Collateral Agent, the authority to release
Collateral conferred upon the Collateral Agent under Section 10.08(b). Upon
receipt by the Collateral Agent of confirmation from the Lenders of its
authority to release any particular item or types of Collateral, and upon prior
written request by any Loan Party, the Collateral Agent shall (and is hereby
irrevocably authorized by the Lenders to) execute such documents as may be
necessary to evidence the release of the Liens granted to the Collateral Agent
for the benefit of the Lenders upon such Collateral; provided, however, that (i)
the Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent's opinion, would expose the Collateral Agent to
liability or create any obligations or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Obligations or any Lien upon
(or obligations of any Loan Party in respect of) all interests in the Collateral
retained by any Loan Party.
(d) The Collateral Agent shall have no obligation whatsoever to
any Lenders to assure that the Collateral exists or is owned by the Loan Parties
or is cared for, protected or insured or has been encumbered or that the Lien
granted to the Collateral Agent pursuant to this Agreement has been properly or
sufficiently or lawfully created, perfected, protected or enforced or is
entitled to any particular priority, or to exercise at all or in any particular
manner or under any duty of care, disclosure or fidelity, or to continue
exercising, any of the rights, authorities and powers granted or available to
the Collateral Agent in this Section 10.08 or in any of the Loan Documents, it
being understood and agreed that in respect of the Collateral, or any act,
omission or event related thereto, the Collateral Agent may act in any manner it
may deem appropriate, in its sole discretion, given the Collateral Agent's own
interest in the Collateral as one of the Lenders and that the Collateral Agent
shall have no duty or liability whatsoever to any other Lender.
(e) To the extent that Collateral Agent shall receive on behalf
of and for the benefit of the Lenders holding Term Loans B or Term Loans C, any
proceeds from the
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sale, transfer or other disposition of, or casualty or condemnation with respect
to the Facility at any time prior to the time at which the Revolving Loan
Obligations have been paid in full each Lender holding a Term Loan B or Term
Loan C shall purchase, without recourse or warranty, an undivided interest and
participation in the Revolving Loan Commitments and the Revolving Loan
Obligations in an amount equal to its Pro Rata Share of such proceeds received;
provided, however, that if all or part of such proceeds received by the
purchasing party is thereafter recovered from it, those purchases of
participations shall be rescinded in whole or in part, as applicable, and the
applicable portion of the purchase price paid therefor shall be returned to such
purchasing party, but without interest except to the extent that such purchasing
party is required to pay interest in connection with the recovery of such
proceeds. The Borrower consents to the foregoing and agrees, to the extent it
may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.
(f) The parties hereby agree that no Revolving Loans shall
constitute, or be deemed to constitute, "any part of the mortgage debt" as such
phrase is used in Section 1301 of the New York Real Property Actions and
Proceedings Law, and that any Revolving Loans shall constitute and be deemed to
constitute indebtedness wholly separate from the Term Loans for all purposes of
such Section.
ARTICLE XI
GUARANTY
SECTION 11.01. Guaranty; Limitation of Liability. The Guarantor
hereby unconditionally and irrevocably guarantees the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all obligations of
the Borrower now or hereafter existing under any Loan Document, whether for
principal, interest, fees, expenses or otherwise (such obligations, to the
extent not paid by the Borrower, being the "Guaranteed Obligations"), and agrees
to pay any and all expenses (including reasonable counsel fees and expenses)
incurred by the Agents, the Lenders and the L/C Issuer in enforcing any rights
under the guaranty set forth in this Article. Without limiting the generality of
the foregoing, the Guarantor's liability shall extend to all amounts that
constitute part of the Guaranteed Obligations and would be owed by the Borrower
to the Agents, the Lenders and the L/C Issuer under any Loan Document but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Borrower.
SECTION 11.02. Guaranty Absolute. The Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of the
Loan Documents, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Agents, the Lenders or the L/C Issuer with respect thereto. The obligations of
the Guarantor under this Article are independent of the Guaranteed Obligations,
and a separate action or actions may be brought and prosecuted against
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the Guarantor to enforce such obligations, irrespective of whether any action is
brought against the Borrower or whether the Borrower is joined in any such
action or actions. The liability of the Guarantor under this Article shall be
irrevocable, absolute and unconditional irrespective of, and the Guarantor
hereby irrevocably waives any defenses it may now or hereafter have in any way
relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan Document
or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Guaranteed Obligations, or any other
amendment or waiver of or any consent to departure from any Loan Document,
including, without limitation, any increase in the Guaranteed Obligations
resulting from the extension of additional credit to the Borrower or otherwise;
(c) any taking, exchange, release or non-perfection of any
Collateral, or any taking, release or amendment or waiver of or consent to
departure from any other guaranty, for all or any of the Guaranteed Obligations;
(d) any change, restructuring or termination of the corporate,
limited liability company or partnership structure or existence of the Borrower;
or
(e) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any representation by
the Agents, the Lenders or the L/C Issuer that might otherwise constitute a
defense available to, or a discharge of, the Guarantor, the Borrower or any
other guarantor or surety.
This Article shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Lender or any other Person upon the
insolvency, bankruptcy or reorganization of the Borrower or otherwise, all as
though such payment had not been made.
SECTION 11.03. Waiver. The Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Article and any requirement that the Agents, the
Lenders or the L/C Issuer exhaust any right or take any action against the
Borrower or any other Person or any collateral. The Guarantor acknowledges that
it will receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section 11.03 is
knowingly made in contemplation of such benefits. The Guarantor hereby waives
any right to revoke this Article, and acknowledges that this Article is
continuing in nature and applies to all Guaranteed Obligations, whether existing
now or in the future.
SECTION 11.04. Continuing Guaranty; Assignments. This Article is a
continuing guaranty and shall (a) remain in full force and effect until the
later of the cash payment in full of the Guaranteed Obligations (other than
indemnification obligations as to which no claim has been made) and all other
amounts payable under this Article and the
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Revolving Credit Termination Date, (b) be binding upon the Guarantor, its
successors and assigns and (c) inure to the benefit of and be enforceable by the
Agents, the Lenders and the L/C Issuer and their successors, pledgees,
transferees and assigns. Without limiting the generality of the foregoing clause
(c), any Lender may pledge, assign or otherwise transfer all or any portion of
its rights and obligations under this Agreement (including, without limitation,
all or any portion of its Commitments, the Loans, the Reimbursement Obligations
and the Letter of Credit Obligations owing to it and any Note held by it) to any
other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted such Lender herein or otherwise, in each
case as provided in Section 12.07.
SECTION 11.05. Subrogation. The Guarantor will not exercise any
rights that it may now or hereafter acquire against the Borrower or any other
insider guarantor that arise from the existence, payment, performance or
enforcement of the Guarantor's obligations under this Article, including,
without limitation, any right of subrogation, reimbursement, exoneration,
contribution or indemnification and any right to participate in any claim or
remedy of the Agents and the Lenders against the Borrower or any other insider
guarantor or any collateral, whether or not such claim, remedy or right arises
in equity or under contract, statute or common law, including, without
limitation, the right to take or receive from the Borrower or any other insider
guarantor, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security solely on account of such claim, remedy or
right, unless and until all of the Guaranteed Obligations and all other amounts
payable under this Article shall have been paid in full in cash and the Final
Maturity Date shall have occurred. If any amount shall be paid to the Guarantor
in violation of the immediately preceding sentence at any time prior to the
later of the payment in full in cash of the Guaranteed Obligations and all other
amounts payable under this Article and the Final Maturity Date, such amount
shall be held in trust for the benefit of the Agents and the Lenders and shall
forthwith be paid to the Agents and the Lenders to be credited and applied to
the Guaranteed Obligations and all other amounts payable under this Article,
whether matured or unmatured, in accordance with the terms of this Agreement, or
to be held as collateral for any Guaranteed Obligations or other amounts payable
under this Article thereafter arising. If (i) the Guarantor shall make payment
to the Agents and the Lenders of all or any part of the Guaranteed Obligations,
(ii) all of the Guaranteed Obligations and all other amounts payable under this
Article shall be paid in full in cash and (iii) the Final Maturity Date shall
have occurred, the Agents and the Lenders will, at the Guarantor's request and
expense, execute and deliver to the Guarantor appropriate documents, without
recourse and without representation or warranty, necessary to evidence the
transfer by subrogation to the Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by the Guarantor.
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ARTICLE XII
MISCELLANEOUS
SECTION 12.01. Notices, Etc. All notices and other communications
provided for hereunder shall be in writing and shall be mailed, telecopied or
delivered, if to any Loan Party, at the following address:
Decora Industries, Inc.
0 Xxxx Xxxxxx
Xxxx Xxxxxx, XX 00000-0000
Attention: Chief Financial Officer
Telephone: 000-000-0000
Telecopier: 000-000-0000
with a copy to:
Xxxxxx & Xxxxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxxx, Esq.
Telephone: 000-000-0000
Telecopier: 000-000-0000
if to the Administrative Agent, to it at the following address:
The CIT Group/Business Credit, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx
Telephone: 000-000-0000
Telecopier: 000-000-0000
if to the Collateral Agent, to it at the following address:
Ableco Finance LLC
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxx
Telephone: 000-000-0000
Telecopier: 000-000-0000
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in each case, with a copy to:
Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Telephone: 000-000-0000
Telecopier: 000-000-0000
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party complying as to delivery with the terms
of this Section 12.01. All such notices and other communications shall be
effective, (i) if mailed, when received or three days after deposited in the
mails, whichever occurs first, (ii) if telecopied, when transmitted and
confirmation received, or (iii) if delivered, upon delivery, except that notices
to any Agent or the L/C Issuer pursuant to Articles II and III shall not be
effective until received by such Agent or the L/C Issuer, as the case may be.
SECTION 12.02. Amendments, Etc. (a) No amendment or waiver of any
provision of this Agreement or any Note, and no consent to any departure by the
Borrower or any other Loan Party therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Lenders, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given provided, however, that no amendment,
waiver or consent shall (i) increase the Commitment of any Lender, reduce the
principal of, or interest on, the Loans or the Reimbursement Obligations payable
to any Lender, reduce the amount of any fee payable for the account of any
Lender, or postpone or extend any date fixed for any payment of principal of, or
interest or fees on, the Loans or Letter of Credit Obligations payable to any
Lender, in each case without the written consent of any Lender affected thereby,
(ii) increase the Total Commitment without the written consent of each Lender,
(iii) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Notes that is required for the Lenders or any of them to
take any action hereunder, (iv) amend the definition of "Required Lenders" or
"Pro Rata Share", (v) release all or a substantial portion of the Collateral
(except as otherwise provided in this Agreement and the other Loan Documents),
subordinate any Lien granted in favor of the Collateral Agent for the benefit of
the Lenders, or release the Borrower or any Guarantor, or (vi) amend, modify or
waive Section 4.04 or this Section 12.02 of this Agreement, in each case without
the written consent of each Lender. Notwithstanding the foregoing, no amendment,
waiver or consent shall, unless in writing and signed by an Agent, affect the
rights or duties of such Agent (but not in its capacity as a Lender) under this
Agreement or the other Loan Documents.
(b) The Administrative Agent and CIT, in its capacity as a Lender,
on the one hand, and the Collateral Agent and Ableco and its Affiliates, in its
capacity as a Lender, on the other hand, have executed an agreement on the
Effective Date pursuant to which the Administrative Agent, CIT, the Collateral
Agent and Ableco and its Affiliates have agreed, among other things, to certain
voting arrangements relative to matters requiring the approval of
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the Lenders. The rights and duties of the Administrative Agent, CIT, the
Collateral Agent, and Ableco and its Affiliates, with respect to such matters,
are subject to such Agreement.
SECTION 12.03. No Waiver; Remedies, Etc. No failure on the part of
any Agent or any Lender to exercise, and no delay in exercising, any right
hereunder or under any other Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right under any Loan Document
preclude any other or further exercise thereof or the exercise of any other
right. The rights and remedies of the Agents and the Lenders provided herein and
in the other Loan Documents are cumulative and are in addition to, and not
exclusive of, any rights or remedies provided by law. The rights of the Agents
and the Lenders under any Loan Document against any party thereto are not
conditional or contingent on any attempt by the Agents and the Lenders to
exercise any of their rights under any other Loan Document against such party or
against any other Person.
SECTION 12.04. Expenses; Taxes; Attorneys' Fees. The Borrower will
pay on demand, all costs and expenses incurred by or on behalf of the Agents
(and, in the case of clauses (c) through (m) below, the Lenders), regardless of
whether the transactions contemplated hereby are consummated, including, without
limitation, reasonable fees, costs, client charges and expenses of counsel for
the Agents (and, in the case of clauses (c) through (m) below, the Lenders),
accounting, due diligence, periodic field audits, physical counts, valuations,
investigations, searches and filings, monitoring of assets, appraisals of
Collateral, environmental assessments, miscellaneous disbursements, examination,
travel, lodging and meals, arising from or relating to: (a) the negotiation,
preparation, execution, delivery, performance and administration of this
Agreement and the other Loan Documents, (including, without limitation, the
preparation of any additional Loan Documents, pursuant to Section 7.01(b) or the
review of any of the agreements, instruments and documents referred to in
Section 7.02(f)), (b) any requested amendments, waivers or consents to this
Agreement or the other Loan Documents whether or not such documents become
effective or are given, (c) the preservation and protection of any of the
Lenders' rights under this Agreement or the other Loan Documents, (d) the
defense of any claim or action asserted or brought against the Agents or the
Lenders by any Person that arises from or relates to this Agreement, any other
Loan Document, the Agents' or the Lenders' claims against the Borrower and each
other Loan Party, or any and all matters in connection therewith, (e) the
commencement or defense of, or intervention in, any court proceeding arising
from or related to this Agreement or any other Loan Document, (f) the filing of
any petition, complaint, answer, motion or other pleading by the Agents or the
Lenders, or the taking of any action in respect of the Collateral or other
security, in connection with this Agreement or any other Loan Document, (g) the
protection, collection, lease, sale, taking possession of or liquidation of, any
Collateral or other security in connection with this Agreement or any other Loan
Document, (h) any attempt to enforce any Lien or security interest in any
Collateral or other security in connection with this Agreement or any other Loan
Document, (i) any attempt to collect from the Borrower or any other Loan Party,
(j) the receipt by the Agents or the Lenders of any advice from professionals
with respect to any of the foregoing, (k) all liabilities and costs arising from
or in connection with the past, present or future operations of the Borrower and
each other Loan Party involving any damage to real or personal property or
natural resources or harm or injury alleged to have resulted from any Release of
Hazardous Materials on, upon or into such property, (l) any Environmental
Liabilities and Costs incurred in connection with the
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investigation, removal, cleanup and/or remediation of any Hazardous Materials
present or arising out of the operations of any facility of the Borrower and any
other Loan Party, or (m) any Environmental Liabilities and Costs incurred in
connection with any Environmental Lien. Without limitation of the foregoing or
any other provision of any Loan Document: (x) the Borrower agrees to pay all
stamp, document, transfer, recording or filing taxes or fees and similar
impositions now or hereafter determined by any Agent or any Lender to be payable
in connection with this Agreement or any other Loan Document, and the Borrower
agrees to save the Agents and the Lenders harmless from and against any and all
present or future claims, liabilities or losses with respect to or resulting
from any omission to pay or delay in paying any such taxes, fees or impositions,
(y) the Borrower agrees to pay all broker fees that may become due in connection
with the transactions contemplated by this Agreement, and (z) if the Borrower
fails to perform any covenant or agreement contained herein or in any other Loan
Document, any Agent may itself perform or cause performance of such covenant or
agreement, and the expenses of the such Agent incurred in connection therewith
shall be reimbursed on demand by the Borrower.
SECTION 12.05. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, any Lender may, and is hereby authorized
to, at any time and from time to time, without notice to the Borrower (any such
notice being expressly waived by the Borrower) and to the fullest extent
permitted by law, set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender to or for the credit or the account of the
Borrower against any and all obligations of either now or hereafter existing
under any Loan Document, irrespective of whether or not such Lender shall have
made any demand hereunder or thereunder and although such obligations may be
contingent or unmatured. Each Lender agrees to notify the Borrower promptly
after any such set-off and application made by such Lender provided that the
failure to give such notice shall not affect the validity of such set-off and
application.
SECTION 12.06. Severability. Any provision of this Agreement, which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or affecting
the validity or enforceability of such provision in any other jurisdiction.
SECTION 12.07. Assignments and Participations.
(a) This Agreement and the Notes shall be binding upon and inure
to the benefit of the Borrower and the other the Loan Parties and each Agent and
each Lender and their respective successors and assigns; provided, however, that
each of the Borrower and the other Loan Parties may not assign or transfer any
of their rights hereunder, or under the Notes, without the prior written consent
of each Lender and any such assignment without the Lenders' prior written
consent shall be null and void.
(b) Each Lender may, with the written consent of the Collateral
Agent, assign to one or more other lenders or other entities all or a portion of
its rights and obligations under this Agreement (including, without limitation,
all or a portion of its Commitments, the Loans made by it, the Notes held by it
and its Pro Rata Share of Letter of Credit Obligations);
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provided, however, that (i) such assignment is in an amount which is at least
$5,000,000 or a multiple of $1,000,000 in excess thereof (or the remainder of
such Lender's Commitment) and (ii) the parties to each such assignment shall
execute and deliver to the Collateral Agent, for its acceptance, an Assignment
and Acceptance, together with any Note subject to such assignment and such
parties shall deliver to the Collateral Agent a processing and recordation fee
of $5,000. Upon such execution, delivery and acceptance, from and after the
effective date specified in each Assignment and Acceptance, which effective date
shall be at least three Business Days after the delivery thereof to the
Collateral Agent (or such shorter period as shall be agreed to by the Collateral
Agent and the parties to such assignment), (A) the assignee thereunder shall
become a "Lender" hereunder and, in addition to the rights and obligations
hereunder held by it immediately prior to such effective date, have the rights
and obligations hereunder that have been assigned to it pursuant to such
Assignment and Acceptance and (B) the assigning Lender thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).
(i) By executing and delivering an Assignment and
Acceptance, the assigning Lender and the assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (A) other than as
provided in such Assignment and Acceptance, the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Loan Document furnished pursuant hereto; (B) the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Loan Parties or any of their Subsidiaries or the
performance or observance by the Loan Parties of any of their obligations under
this Agreement or any other Loan Document furnished pursuant hereto; (C) such
assignee confirms that it has received a copy of this Agreement and the other
Loan Documents, together with such other documents and information it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (D) such assignee will, independently and without
reliance upon the Assigning Lender, any Agent or any Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents; (E) such assignee appoints and
authorizes the Agents to take such action as agents on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to the Agents by the terms thereof, together with such powers as are
reasonably incidental thereto; and (F) such assignee agrees that it will perform
in accordance with their terms all of the obligations which by the terms of this
Agreement and the other Loan Documents are required to be performed by it as a
Lender.
(ii) The Collateral Agent shall maintain, or cause to be
maintained at the Payment Office, a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of the
Loans and Letter of Credit Obligations owing to each
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Lender from time to time (the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Agents and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower and
any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(iii) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an assignee, together with the Notes subject
to such assignment, the Collateral Agent shall, if the Collateral Agent consents
to such assignment and if such Assignment and Acceptance has been completed (i)
accept such Assignment and Acceptance, (ii) give prompt notice thereof to the
Borrower, (iii) record the information contained therein in the Register, and
(iv) prepare and distribute to each Lender and the Borrower a revised Schedule
1.01(A) hereto after giving effect to such assignment, which revised Schedule
1.01(A) shall replace the prior Schedule 1.01(A) and become part of this
Agreement.
(iv) A Registered Loan (and the Registered Note, if any,
evidencing the same) may be assigned or sold in whole or in part only by
registration of such assignment or sale on the Register (and each Registered
Note shall expressly so provide). Any assignment or sale of all or part of such
Registered Loan (and the Registered Note, if any, evidencing the same) may be
effected only by registration of such assignment or sale on the Register,
together with the surrender of the Registered Note, if any, evidencing the same
duly endorsed by (or accompanied by a written instrument of assignment or sale
duly executed by) the holder of such Registered Note, whereupon, at the request
of the designated assignee(s) or transferee(s), one or more new Registered Notes
in the same aggregate principal amount shall be issued to the designated
assignee(s) or transferee(s). Prior to the registration of assignment or sale of
any Registered Loan (and the Registered Note, if any evidencing the same), the
Agents shall treat the Person in whose name such Loan (and the Registered Note,
if any, evidencing the same) is registered as the owner thereof for the purpose
of receiving all payments thereon and for all other purposes, notwithstanding
notice to the contrary.
(v) In the event that any Lender sells participations in the
Registered Loan, such Lender shall maintain a register on which it enters the
name of all participants in the Registered Loans held by it (the "Participant
Register"). A Registered Loan (and the Registered Note, if any, evidencing the
same) may be participated in whole or in part only by registration of such
participation on the Participant Register (and each Registered Note shall
expressly so provide). Any participation of such Registered Loan (and the
Registered Note, if any, evidencing the same) may be effected only by the
registration of such participation on the Participant Register.
(vi) Any foreign Person who purchases or is assigned or
participates in any portion of such Loan shall provide the Agents (in the case
of a purchase or assignment) or the Lender (in the case of a participation) with
a completed Internal Revenue Service Form W-8 (Certificate of Foreign Status) or
a substantially similar form for such purchaser, participant or any other
affiliate who is a holder of beneficial interests in the Loan.
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(c) Each Lender may sell participations to one or more banks or
other entities in or to all or a portion of its rights and obligations under
this Agreement and the other Loan Documents (including, without limitation, all
or a portion of its Commitments, the Loans made by it and its Pro Rata Share of
the Letter of Credit Obligations); provided, that (i) such Lender's obligations
under this Agreement (including, without limitation, its Commitments hereunder)
and the other Loan Documents shall remain unchanged; (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and the Borrower, the Agents and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and the other Loan
Documents; and (iii) a participant shall not be entitled to require such Lender
to take or omit to take any action hereunder except (A) action directly
effecting an extension of the maturity dates or decrease in the principal amount
of the Loans or Letter of Credit Obligations, or (B) action directly effecting
an extension of the due dates or a decrease in the rate of interest payable on
the Loans or the fees payable under this Agreement, or (C) actions directly
effecting a release of all or a substantial portion of the Collateral or the
Borrower or any Guarantor (except as set forth in Section 10.08 of this
Agreement or any Loan Document).
SECTION 12.08. Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement.
SECTION 12.09. GOVERNING LAW. THIS AGREEMENT, THE NOTES AND THE
OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN
THE STATE OF NEW YORK.
SECTION 12.10. CONSENT TO JURISDICTION; SERVICE OF PROCESS AND
VENUE. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX IN THE
COUNTY OF NEW YORK OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
LOAN PARTY HEREBY IRREVOCABLY ACCEPT IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH LOAN PARTY
FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS AND IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF
COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO BORROWER AT
ITS ADDRESS FOR NOTICES AS SET FORTH IN SECTION 12.01, SUCH SERVICE TO BECOME
EFFECTIVE TEN (10) DAYS AFTER SUCH MAILING. EACH LOAN PARTY HEREBY IRREVOCABLY
APPOINTS THE SECRETARY OF STATE OF THE STATE OF NEW YORK AS ITS AGENT FOR
SERVICE OF PROCESS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING. NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE LENDER TO SERVICE OF PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL
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PROCEEDINGS OR OTHERWISE PROCEED AGAINST EACH LOAN PARTY IN ANY OTHER
JURISDICTION. EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT EACH LOAN PARTY HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF
ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 12.11. WAIVER OF JURY TRIAL, ETC. EACH LOAN PARTY, THE
AGENTS AND THE LENDERS HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AGREEMENT, THE NOTES
OR OTHER LOAN DOCUMENTS, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT,
DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN
CONNECTION THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, AND AGREE THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH LOAN
PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY AGENT
OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ANY AGENT OR ANY
LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK
TO ENFORCE THE FOREGOING WAIVERS. EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDERS ENTERING INTO THIS AGREEMENT.
SECTION 12.12. Consent by the Agents and Lenders. Except as
otherwise expressly set forth herein to the contrary, if the consent, approval,
satisfaction, determination, judgment, acceptance or similar action (an
"Action") of any Agent or any Lender shall be permitted or required pursuant to
any provision hereof or any provision of any other agreement to which the
Borrower and any other Loan Party are parties and to which any Agent or any
Lender has succeeded thereto, such Action shall be required to be in writing and
may be withheld or denied by such Agent or such Lender, in its sole discretion,
with or without any reason, and without being subject to question or challenge
on the grounds that such Action was not taken in good faith.
SECTION 12.13. No Party Deemed Drafter. Each of the parties hereto
agrees that no party hereto shall be deemed to be the drafter of this Agreement.
SECTION 12.14. Reinstatement; Certain Payments. If any claim is ever
made upon any Agent, any Lender or the L/C Issuer for repayment or recovery of
any amount or amounts
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received by such Agent, such Lender or the L/C Issuer in payment or on account
of any of the Obligations, such Agent, such Lender or the L/C Issuer shall give
prompt notice of such claim to each other Agent and Lender and the Borrower, and
if such Agent, such Lender or the L/C Issuer repays all or part of such amount
by reason of (i) any judgment, decree or order of any court or administrative
body having jurisdiction over such Agent, such Lender or the L/C Issuer or any
of their property, or (ii) any good faith settlement or compromise of any such
claim effected by such Agent, such Lender or the L/C Issuer with any such
claimant, then and in such event each Loan Party agrees that (A) any such
judgment, decree, order, settlement or compromise shall be binding upon it
notwithstanding the cancellation of any Note or other instrument evidencing the
Obligations or the other Loan Documents or the termination of this Agreement or
the other Loan Documents, and (B) it shall be and remain liable to such Agent,
such Lender or the L/C Issuer hereunder for the amount so repaid or recovered to
the same extent as if such amount had never originally been received by such
Agent, such Lender or the L/C Issuer.
SECTION 12.15. Indemnification. In addition to each Loan Party's
other Obligations under this Agreement, each Loan Party agrees to, jointly and
severally, defend, protect, indemnify and hold harmless each Agent, each Lender,
the L/C Issuer and all of their respective officers, directors, employees,
attorneys, consultants and agents (collectively called the "Indemnitees") from
and against any and all losses, damages, liabilities, obligations, penalties,
fees, reasonable costs and expenses (including, without limitation, reasonable
attorneys' fees, costs and expenses) incurred by such Indemnitees, whether prior
to or from and after the Effective Date, whether direct, indirect or
consequential, as a result of or arising from or relating to or in connection
with any of the following: (i) the negotiation, preparation, execution or
performance or enforcement of this Agreement, any other Loan Document or of any
other document executed in connection with the transactions contemplated by this
Agreement, (ii) any Agent's or any Lender's furnishing of funds to the Borrower
or the L/C Issuer's issuing of the Support Letter of Credit for the account of
the Borrower under this Agreement, including, without limitation, the management
of any such Loans, the Reimbursement Obligations or the Letter of Credit
Obligations, (iii) any matter relating to the financing transactions
contemplated by this Agreement or the other Loan Documents or by any document
executed in connection with the transactions contemplated by this Agreement or
the other Loan Documents, or (iv) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether or not any Indemnitee is a
party thereto (collectively, the "Indemnified Matters"); provided, however, that
the Loan Parties shall not have any obligation to any Indemnitee under this
Section 12.15 for any Indemnified Matter caused by the gross negligence or
willful misconduct of such Indemnitee, as determined by a final judgment of a
court of competent jurisdiction. Such indemnification for all of the foregoing
losses, damages, fees, costs and expenses of the Indemnitees are chargeable
against the Loan Account. To the extent that the undertaking to indemnify, pay
and hold harmless set forth in this Section 12.15 may be unenforceable because
it is violative of any law or public policy, each Loan Party shall, jointly and
severally, contribute the maximum portion which it is permitted to pay and
satisfy under applicable law, to the payment and satisfaction of all Indemnified
Matters incurred by the Indemnitees. This Indemnity shall survive the repayment
of the Obligations and the discharge of the Liens granted under the Loan
Documents.
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SECTION 12.16. Records. The unpaid principal of and interest on the
Notes, the interest rate or rates applicable to such unpaid principal and
interest, the duration of such applicability, the Commitments, and the accrued
and unpaid fees payable pursuant to Section 2.06 hereof, including, without
limitation, the Closing Fee, Loan Servicing Fee, the Anniversary Fee, the Unused
Line Fee, the Letter of Credit Fee and Commitment Fee, shall at all times be
ascertained from the records of the Agents, which shall be conclusive and
binding absent manifest error.
SECTION 12.17. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Parent, the Borrower, each Agent and
each Lender and when the conditions precedent set forth in Section 5.01 hereof
have been satisfied or waived in writing by the Agents, and thereafter shall be
binding upon and inure to the benefit of the Borrower, each Agent and each
Lender, and their respective successors and assigns, except that the Parent and
the Borrower shall not have the right to assign their rights hereunder or any
interest herein without the prior written consent of each Lender, and any
assignment by any Lender shall be governed by Section 12.07 hereof.
SECTION 12.18. Confidentiality. Each Agent and each Lender agrees
(on behalf of itself and each of its directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature and in accordance with safe and sound practices of comparable
commercial finance companies, any non-public information supplied to it by the
Loan Parties pursuant to this Agreement or the other Loan Documents which is
identified by the Loan Parties as being confidential at the time the same is
delivered to such Person (and which at the time is not, and does not thereafter
become, publicly available or available to such Person from another source not
known to be subject to a confidentiality obligation to such Person not to
disclose such information), provided that nothing herein shall limit the
disclosure of any such information (i) to the extent required by statute, rule,
regulation or judicial process, (ii) to counsel for any Agent or any Lender,
(iii) to examiners, auditors, accountants or Securitization Parties, (iv) in
connection with any litigation to which any Agent or any Lender is a party or
(v) to any assignee or participant (or prospective assignee or participant) so
long as such assignee or participant (or prospective assignee or participant)
first agrees, in writing, to be bound by confidentiality provisions similar in
substance to this Section 12.18. Each Agent and each Lender agrees that, upon
receipt of a request or identification of the requirement for disclosure
pursuant to clause (iv) hereof, it will make reasonable efforts to keep the Loan
Parties informed of such request or identification; provided that the each Loan
Party acknowledges that each Agent and each Lender may make disclosure as
required or requested by any Governmental Authority or representative thereof
and that each Agent and each Lender may be subject to review by Securitization
Parties or other regulatory agencies and may be required to provide to, or
otherwise make available for review by, the representatives of such parties or
agencies any such non-public information.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
BORROWER:
DECORA, INCORPORATED
By:
-----------------------------------------
Name:
Title:
GUARANTOR:
DECORA INDUSTRIES, INC.
By:
-----------------------------------------
Name:
Title:
COLLATERAL AGENT AND LENDER:
ABLECO FINANCE LLC
By:
-----------------------------------------
Name:
Title:
ADMINISTRATIVE AGENT AND LENDER:
THE CIT GROUP/BUSINESS CREDIT, INC.
By:
-----------------------------------------
Name:
Title:
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Schedule 1.01(A)
Lenders and Lenders' Commitments
Revolving Credit
Lender Commitment Percentage
------ ---------------- ----------
Ableco Finance LLC $ -0- 0%
The CIT Group/Business Credit, Inc. $14,000,000 100%
----------- ---
Total Revolving Credit Commitment $14,000,000 100%
Term Loan A Term Loan B Term Loan C
Lender Commitment Commitment Commitment Percentage
------ ---------- ----------- ----------- ----------
Ableco Finance LLC $8,750,000 $2,250,000 $2,000,000 100%
The CIT Group/Business Credit, Inc. $ -0- $ -0- $ -0- 0%
---------- ---------- ---------- ---
Total Term Loan A Commitment/
Total Term Loan B Commitment/
Total Term Loan C Commitment $8,750,000 $2,250,000 $2,000,000 100%
Revolving Credit Term Loan A/B/C
Lender Commitment Commitment Percentage
------ ---------------- --------------- ----------
Ableco Finance LLC $ -0- $13,000,000 48.15%
The CIT Group/ $14,000,000 $ -0- 51.85%
Business Credit, Inc.
----------- ----------- ------
Total Commitment $14,000,000 $13,000,000 100.00%
