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CREDIT AGREEMENT
Among
XXXXXXX (DE), INC.,
XXXXXXX, INC.,
SAFEWAY CHEMICAL TRANSPORTATION, INC.,
BRITE-SOL SERVICES, INC.,
XXXXXXX LEASING, INC.,
SUPER SERVICE, INC.
and
Certain Banking Institutions Named Herein
with
FIRST UNION NATIONAL BANK
As Agent
dated
August 19, 1998
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Table of Contents
1. Certain Definitions................................................................ 1
1.1. Definitions................................................................. 1
1.2. Accounting Terms............................................................12
2. The Credit.........................................................................13
2.1. The Loans...................................................................13
(a) Revolving Credit Loans..................................................13
(b) Term Loans..............................................................13
(c) Short Term Advances.....................................................13
(d) Limit for Xxxxxxx Leasing, Inc..........................................14
(e) Interest Rate Options...................................................14
(f) Maximum Loans Outstanding...............................................14
(g) Minimum Loan Amount.....................................................15
(h) Prepayment and Reborrowing..............................................15
(i) Extensions of the Revolver Termination Date.............................15
(j) Loan Commitment Percentages.............................................15
(k) Several Obligations.....................................................15
(l) Payment of Additional Amount............................................15
2.2. Standby Letters of Credit...................................................16
2.3. The Notes...................................................................17
(a) Revolving Credit Notes..................................................17
(b) Term Notes..............................................................17
2.4. Funding Procedures..........................................................17
(a) Request for Advance.....................................................17
(b) Actions by Agent........................................................18
(c) Availability of Funds...................................................18
(d) Funding Assumptions.....................................................18
(e) Proceeds of Loan Being Repaid...........................................18
2.5. Interest....................................................................18
(a) Base Rate Loans.........................................................18
(b) LIBO Rate Loans.........................................................19
(c) Conversion to Base Rate.................................................19
(d) Renewals and Conversions................................................19
(e) Interim Payments At Base Rate...........................................19
(f) Reinstatements..........................................................19
2.6. Fees.........................................................................20
(a) Closing Fee.............................................................20
(b) Unused Commitment Fee...................................................20
2.7. Reduction or Termination of Loan Commitments................................20
(a) Voluntary...............................................................20
(b) Loan Commitment Termination.............................................20
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2.8. Voluntary Prepayments.......................................................20
(a) Base Rate Loans.........................................................20
(b) LIBO Rate Loans.........................................................21
2.9. Payments.....................................................................21
(a) Accrued Interest........................................................21
(b) Form of Payments, Application of Payments, Payment Administration, Etc. 21
(c) Demand Deposit Account..................................................21
(d) Net Payments............................................................22
2.10. Change in Circumstances, Yield Protection..................................22
(a) Certain Regulatory Changes...............................................22
(b) Capital Adequacy........................................................22
(c) Ability to Determine LIBO Rate..........................................22
(d) Yield Protection........................................................23
(e) Notice of Events........................................................23
2.11. Illegality.................................................................23
2.12. Discretion of each Bank as to Manner of Funding............................23
3. Representations and Warranties.....................................................24
3.1. Corporate Existence and Power................................................24
3.2. Corporate Authorization; No Contravention...................................24
3.3. Governmental Authorization..................................................24
3.4. Binding Effect..............................................................24
3.5. Litigation..................................................................25
3.6. No Default..................................................................25
3.7. ERISA Compliance............................................................25
3.8. Use of Proceeds; Margin Regulations.........................................25
3.9. Title to Properties.........................................................25
3.10. Taxes......................................................................25
3.11. Financial Condition........................................................26
3.12. Environmental Matters......................................................26
3.13. Regulated Entities.........................................................26
3.14. No Burdensome Restrictions.................................................26
3.15. Subsidiaries...............................................................26
3.16. Insurance..................................................................26
3.17. Solvency...................................................................27
3.18. Borrowing Base Availability................................................27
3.19. Permits, Licenses, Etc.....................................................27
3.20. Year 2000 Problem..........................................................27
3.21. Disclosure Generally.......................................................27
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4. Conditions Precedent...............................................................27
4.1. All Loans...................................................................27
(a) Request For Advance.....................................................27
(b) Borrowing Base Certificate..............................................27
(c) Covenants; Representations..............................................27
(d) Defaults................................................................27
(e) Material Adverse Effect.................................................28
4.2. Conditions to First Loan....................................................28
(a) Articles, Bylaws........................................................28
(b) Evidence of Authorization...............................................28
(c) Legal Opinions..........................................................28
(d) Incumbency..............................................................28
(e) Revolving Credit Notes..................................................28
(f) Documents...............................................................28
(g) Other Agreements........................................................28
(h) Fees, Expenses..........................................................28
5. Affirmative Covenants..............................................................29
5.1. Financial Statements and Reports............................................29
(a) Annual Statements.......................................................29
(b) Quarterly Statements....................................................29
5.2. Certificates; Other Information.............................................29
(a) Compliance Certificate..................................................29
(b) Borrowing Base Certificate..............................................29
(c) ERISA...................................................................29
(d) Material Changes........................................................30
(e) Subsidiaries............................................................30
(f) Other Information.......................................................30
5.3. Corporate Existence..........................................................30
5.4. ERISA........................................................................30
5.5. Environmental Laws...........................................................30
5.6. Compliance with Regulations..................................................30
5.7. Compliance with Laws.........................................................30
5.8. Maintenance of Properties....................................................30
5.9. Maintenance of Insurance.....................................................30
5.10. Payment of Debt; Payment of Taxes, Etc......................................31
5.11. Notice of Events............................................................31
5.12. Inspection Rights...........................................................32
5.13. Compliance with Material Contracts..........................................32
5.14. Use of Proceeds.............................................................32
5.15. Significant Subsidiaries....................................................32
5.16. Year 2000 Program...........................................................32
5.17. Further Assurances..........................................................33
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6. Negative Covenants.................................................................33
6.1. Consolidation and Merger.....................................................33
6.2. Liens.......................................................................34
6.3. Guarantees, Loans or Advances...............................................34
6.4. Acquisitions and Investments................................................34
6.5. Restricted Payments.........................................................34
6.6. Margin Stock................................................................35
6.7. Change in Business..........................................................35
6.8. Accounting Change...........................................................35
6.9. Transactions with Affiliates................................................35
6.10. Restriction on Amendment of this Agreement.................................35
6.11. Negative, Negative Pledge Agreements.......................................35
7. Financial Covenants................................................................35
7.1. Minimum Tangible Net Worth..................................................35
7.2. Fixed Charge Coverage Ratio.................................................35
7.3. Leverage Ratio..............................................................35
7.4. Borrowing Base..............................................................36
8. Default............................................................................36
8.1. Events of Default...........................................................36
(a) Payments................................................................36
(b) Covenants...............................................................36
(c) Representations, Warranties.............................................36
(d) Bankruptcy..............................................................36
(e) ERISA...................................................................36
(f) Certain Other Defaults..................................................37
(g) Judgments...............................................................37
(h) Change in Control.......................................................37
(i) Material Adverse Effect.................................................37
9. Collateral.........................................................................37
9.1. Collateral & Security Agreement............................................37
9.2. Conditions Subsequent......................................................38
10. Agent.............................................................................38
10.1. Appointment and Authorization..............................................38
10.2. Duties and Obligations.....................................................39
10.3. First Union as a Bank......................................................39
10.4. Independent Credit Decisions...............................................39
10.5. Indemnification............................................................40
10.6. Successor Agent............................................................40
10.7. Allocations Made By First Union............................................40
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11. Miscellaneous.....................................................................40
11.1 Modifications and Waivers..................................................40
11.2. Waiver.....................................................................41
11.3. Governing Law..............................................................41
11.4. Participations and Assignments.............................................41
11.5. Captions...................................................................42
11.6. Notices....................................................................42
11.7. Sharing of Collections, Proceeds and Set-Offs: Application of Payments.....42
11.8. Expenses; Indemnification..................................................43
11.9. Survival of Warranties and Certain Agreements..............................43
11.10. Severability...............................................................44
11.11. Banks' Obligations Several; Independent Nature of Banks' Rights............44
11.12. No Fiduciary Relationship..................................................44
11.13. CONSENT TO JURISDICTION AND SERVICE OF PROCESS.............................44
11.14. WAIVER OF JURY TRIAL.......................................................44
11.15. Counterparts; Effectiveness................................................45
11.16. Use of Defined Terms.......................................................45
11.17. Offsets....................................................................45
11.18. Entire Agreement...........................................................45
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EXHIBIT A LIST OF BANKS AND COMMITMENTS
EXHIBIT B REVOLVING CREDIT NOTE
EXHIBIT C TERM NOTE
EXHIBIT D BORROWING BASE CERTIFICATE
EXHIBIT E SECURITY AGREEMENT
EXHIBIT F COMPLIANCE CERTIFICATE
SCHEDULE 1 MISCELLANEOUS INFORMATION
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Credit Agreement
This Credit Agreement, dated August 19, 1998 (the "Agreement"), is entered
into between and among XXXXXXX (DE), INC. (the "Company"), XXXXXXX, INC. ("MI"),
SAFEWAY CHEMICAL TRANSPORTATION, INC. ("SCT"), BRITE-SOL SERVICES, INC. ("BSS"),
XXXXXXX LEASING, INC. ("MLI"), SUPER SERVICE, INC. ("SSI") (the Company, MI,
SCT, BSS, MLI and SSI are each individually and collectively referred to as the
"Borrowers"), jointly and severally, the banking institutions signatories hereto
and named in Exhibit A attached hereto and such other institutions that
hereafter become a "Bank" pursuant to ss. 11.4 hereof (collectively the "Banks"
and individually a "Bank") and FIRST UNION NATIONAL BANK, a national banking
association, as agent for the Banks under this Agreement ("First Union", which
shall mean in its capacity as agent unless specifically stated otherwise).
Preliminary Statement
WHEREAS, Each of the Borrowers desire to have available to them a revolving
credit facility for general working capital purposes.
WHEREAS, the Banks are willing to establish such revolving credit facility
and make loans to Borrowers under the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and promises hereinafter
set forth and intending to be legally bound hereby, the parties hereto agree as
follows:
1. Certain Definitions
1.1. Definitions.
"Accounts" shall mean all accounts receivable of a Person, now owned and
hereafter arising.
"Adjusted LIBO Rate" shall mean, for any Interest Period, the rate per
annum (rounded upwards, if necessary to the next 1/16 of 1%) determined
pursuant to the following formula:
LIBO Rate
Adjusted LIBO Rate = ----------------------
1 - Reserve Percentage
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"Affiliate" shall mean as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the
power to direct or cause the direction of the management and policies of
the other Person, whether through the ownership of voting securities,
membership interests, by contract, or otherwise. Affiliate does not include
Xxxxxxx Truck Leasing, Corp., Safety-Kleen Corp. or Dover Downs
Entertainment, Inc.
"Aggregate Loan Commitment" shall have the meaning set forth in ss 2.1(a).
"Agreement" shall mean this Credit Agreement, as amended, supplemented,
modified, replaced, substituted for or restated from time to time and all
exhibits and schedules attached hereto.
"Amortization and Depreciation Period" shall mean, with respect to Eligible
Equipment Subject to Lease, a period not to exceed (a) twelve (12) years
from the date of manufacture or rebuild with respect to tank trailers and
containers, and (b) six (6) years from the date of manufacture or rebuild
with respect to trucks.
"Base Rate" shall mean (i) the rate of interest for commercial loans
established and publicly announced by First Union from time to time as its
prime rate, or, if higher, (ii) the Federal Funds Rate plus ss. of 1% per
annum. Any change in such interest rate due to a change in the Base Rate
shall be effective on the date of such change.
"Base Rate Loan" shall mean a Loan, or any portion thereof, made at the
Base Rate pursuant to a request for advance made under ss. 2.4 herein or
as otherwise provided in ss. 2.5(a) or in any other provision hereof or in
any other Loan Document.
"Borrowing Base" shall mean, as of any date of determination thereof, an
amount equal to the sum of (v) 90% of the Net Book Value of Eligible
Revenue Equipment plus (x) 85% of Eligible Accounts Receivable plus (y) 90%
of the depreciated book value of Eligible Equipment Subject to Lease minus
(z) all unsecured indebtedness for monies borrowed other than monies
borrowed pursuant to this Agreement.
"Borrowing Base Certificate" shall mean a certificate in substantially the
form attached hereto as Exhibit D hereto which shall be signed by the chief
financial officer or chief executive officer of the Company.
"Business Day" shall mean any day other than a Saturday, Sunday, or other
day on which commercial banks in Philadelphia or San Francisco are
authorized or required to close under the laws of the Commonwealth of
Pennsylvania and, if the applicable day relates to a LIBO Rate Loan, or
notice with respect to a LIBO Rate Loan, a day on which dealings in Dollar
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deposits are also carried on in the London interbank market and banks are
open for business in London ("London Business Day").
"Change of Control" shall mean (i) the replacement of a majority of the
board of directors of Xxxxxxx Systems, Inc., any of the Borrowers or any
Subsidiary ("Xxxxxxx") from the directors who constituted the board of
directors on the Effective Date for any reason other than death, retirement
or disability, and such replacement shall not have been approved by the
board of directors of Xxxxxxx as constituted on the Effective Date (or as
changed over time with the approval of the board of directors of Xxxxxxx),
(ii) a Person or entity or group of Persons or entities acting in concert,
other than the Xxxxxxx family, shall, as a result of a tender or exchange
offer, open market purchases, privately negotiated purchase or otherwise,
have become the beneficial owner (within the meaning of Rule 13d.3 under
the Securities Exchange Act of 1934, as amended) of securities of Xxxxxxx
representing more than 50% of the voting stock of Xxxxxxx, or (iii) the
Xxxxxxx family and related trusts cease to own at least 75% of its current
hold position.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and all rules and regulations with respect thereto in effect from
time to time.
"Collateral" shall have the meaning set forth in ss. 9.1.
"Compliance Certificate" shall mean a certificate in substantially the form
attached hereto as Exhibit F which shall be signed by the chief financial
officer, treasurer or controller of the Company.
"Consolidated Net Income" shall mean for any period, the consolidated net
income of the Company and its Subsidiaries, after deduction of all
expenses, taxes, and other proper charges, determined in accordance with
GAAP.
"Consolidated Net Worth" shall mean, at any time, the total shareholder's
equity, including capital stock, additional paid-in capital and retained
earnings after deducting treasury stock, of the Company and its
consolidated Subsidiaries prepared in accordance with GAAP.
"Consolidated Total Interest Expense" shall mean for any period the amount
which, in conformity with GAAP, would be set forth opposite the caption
"interest expense" on a consolidated income statement of the Company and
its Subsidiaries for such period.
"Contractual Obligation" shall mean, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or
agreement to which such Person is a party or by which it or any of its
property is bound.
"Current Maturities" shall mean Indebtedness due within one year.
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"Default Rate" on any Loan shall mean two percent (2.0%) per annum above
the rate then applicable to each Loan or portion thereof.
"Dollars" shall mean the lawful currency of the United States of America.
"EBITDA" shall mean with respect to the Company and its Subsidiaries for
any fiscal period, an amount equal to Consolidated Net Income for such
period, plus to the extent deducted in the calculation of Consolidated Net
Income and without duplication, (a) depreciation and amortization for such
period, (b) other noncash charges for such period, (c) income tax expense
for such period and (d) Consolidated Total Interest Expense (including,
without limitation, fees, commissions and other charges associated with
standby letters of credit and other financing charges) paid or accrued
during such period in accordance with GAAP.
"Eligible Accounts Receivable" shall mean, at the time of any determination
thereof, any Account of the Borrowers as to which each of the following
requirements has been met to the satisfaction of the Banks: (a) the
Borrowers have lawful and absolute title to such Account and such Account
is, in the Borrowers' reasonable judgment, collectible in the ordinary
course of business; (b) such Account is not subject to a bona fide dispute,
setoff, counterclaim or other claim or defense on the part of any Person
(including the account debtor of the Account) denying liability under such
Account; (c) such Account is not subject to any Lien in favor of any Person
except those Permitted Liens included in clauses (b), (c) and (g) of the
definition of such term; (d) such Account is not outstanding more than 90
days past its original due date; and (e) the Account Debtor on such Account
is not (i) an Affiliate of the Borrowers; or (ii) the subject of any
reorganization, bankruptcy, receivership, custodianship, insolvency, or
other proceeding analogous to those described in ss. 8.1(d) hereof.
"Eligible Equipment" shall mean Vehicles which are owned by the Borrowers
free and clear of all Liens, except for those Permitted Liens included in
clauses (b), (c), (d) and (g) of the definition of such term
"Eligible Equipment Subject to Lease" shall mean any Vehicle which is (a)
subject to a Lease in Good Standing, (b) is free and clear of all Liens,
except for any Lien granted under this Agreement, and (c) is in good
working order and condition; provided, however, that (x) the Amortization
and Depreciation Period for any such Vehicle does not exceed the applicable
term described in the definition of Amortization and Depreciation Period in
this Section 1.1, and (y) unless approved by the Required Banks, the
depreciated book value of Eligible Equipment Subject to Lease which is
leased to any one lessee or any group of related lessees shall not exceed
$2,000,000 in the aggregate outstanding at any time.
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"Eligible Revenue Equipment" shall mean Eligible Equipment which is used by
the Borrowers or any of them in the normal course of their or its business.
Eligible Revenue Equipment shall not include Eligible Equipment Subject to
Lease.
"Environmental Laws" shall mean all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with
all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authority, in each case relating to environmental, health, safety and land
use matters; including the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), the Clean Air Act, the
Federal Water Pollution Control Act of 1972, the Solid Waste Disposal Act,
the Federal Resource Conservation and Recovery Act, the Toxic Substances
Control Act, the Emergency Planning and Community Right-to-Know Act.
"Equipment" shall mean Vehicles which are owned by the Borrowers free and
clear of all Liens except Permitted Liens.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
it may be amended from time to time.
"ERISA Affiliate" shall mean any corporation which is a member of the same
controlled group of corporations as any Borrower within the meaning of ss.
414(b) of the Code, or any trade or business which is under common control
with any Borrower within the meaning of ss. 414(c) of the Code.
"ERISA Event" shall mean (a) a Reportable Event; (b) a withdrawal by the
Company or any ERISA Affiliate from a Pension Plan subject to ss. 4063 of
ERISA during a plan year in which it was a substantial employer (as defined
in ss. 4001(a)(2) of ERISA) or a cessation of operations which is treated
as such a withdrawal under ss. 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Company or any ERISA Affiliate from a Multiemployer Plan
or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan
amendment as a termination under xx.xx. 4041 or 4041A of ERISA, or the
commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which might reasonably be
expected to constitute grounds under ss. 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV
of ERISA, other than PBGC premiums, due but not delinquent under ss. 4007
of ERISA, upon the Borrowers or any ERISA Affiliate.
"Event of Default" shall have the meaning set forth in ?0.
"Federal Funds Rate" shall mean the daily rate of interest announced from
time to time by the Board of Governors of the Federal Reserve System in
publication H. 15 as the "Federal
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Funds Rate," or if such publication is unavailable, such rate as is
available to First Union on such day.
"Fiscal Quarter" shall mean a fiscal quarter of the Company, which shall be
any quarterly period ending on March 31, June 30, September 30 or December
31 of any year.
"Fiscal Year" shall mean a fiscal year of the Company, which shall end on
the last day of September.
"Fixed Charge Coverage Ratio" shall mean the ratio of EBITDA plus Rental
and Lease Expense to the sum of Consolidated Total Interest Expense, Rental
and Lease Expense, Current Maturities and 20% of Obligations, determined on
a rolling four quarter basis.
"Future Lease Obligations" shall mean the aggregate minimum payments
required under all operating leases with a commitment period of longer than
60 days, provided, however, that the aggregate minimum payments required
under operating leases with a commitment period of 60 days or fewer shall
be included to the extent such aggregate minimum payments exceed $250,000.
"Generally Accepted Accounting Principles" or "GAAP" shall mean generally
accepted accounting principles as in effect from time to time in the United
States, consistently applied.
"Governmental Authority" shall mean the federal, state, county or municipal
government, or any department, agency, bureau or other similar type body
obtaining authority therefrom or created pursuant to any laws.
"Indebtedness" shall mean (i) all indebtedness for borrowed money; (ii) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the
ordinary course of business on ordinary terms); (c) all non-contingent
reimbursement or payment obligations with respect to Surety instruments;
(d) all obligations evidenced by notes, bonds, debentures or similar
instruments, including obligations so evidenced incurred in connection with
the acquisition of property, assets or businesses; (e) all indebtedness
created or arising under any conditional sales or other title retention
agreement, or incurred as financing, in either case with respect to
property acquired by the Person (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property); (f) all obligations with respect to
capital leases; (g) all indebtedness referred to in clauses (a) through (f)
above secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon or
in property (including accounts and contract rights) owned by such Person,
even though such Person has not assumed or become liable for the payment of
such Indebtedness; (h) all Guaranty obligations in respect of indebtedness
or obligations of others of the kinds referred to in clauses (a) through
(g) above; (i) all contingent obligations of such Person with respect to
letters of
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credit, and (j) all obligations under any interest rate swap agreement,
interest rate cap agreement, interest collar agreement, interest rate
hedging agreement, interest rate floor agreement or other similar agreement
or arrangement.
"Intangible Assets" shall mean all assets which would be classified as
intangible assets under GAAP consistently applied, including, without
limitation, goodwill (whether representing the excess of cost over book
value of assets acquired or otherwise), patents, trademarks, trade names,
copyrights, franchises, and deferred charges (including, without
limitation, unamortized debt discount and expense, organization costs, and
research and development costs). For purposes of this definition,
prepayments of taxes, license fees and other expenses shall not be deemed
Intangible Assets.
"Interest Period" shall mean a period commencing on the date of a LIBO Rate
Loan or with respect to a Loan being renewed, the last day of the next
preceding Interest Period and ending one, two, three or six months
thereafter, as requested by Borrowers at the time of its Request for
Advance; provided also that (i) an Interest Period which would otherwise
expire on a day which is not a London Business Day shall be extended to the
next succeeding London Business Day unless such London Business Day falls
in another calendar month, in which case such Interest Period shall end on
the next preceding London Business Day, (ii) any Interest Period which
begins on the last London Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall, subject to the next succeeding
clause, end on the last London Business Day of a calendar month; and (iii)
no Interest Period shall end later than the Revolver Termination Date
unless the Revolving Credit Loans shall have been converted to Term Loans
as contemplated by ss. 2.1 hereof in which case no Interest Period shall
end later than the dates required for the Borrowers to make principal
payments as due in connection with said Term Loans.
"Investment" shall have the meaning set forth in ss. 6.4.
"Lease" shall mean a lease of Eligible Equipment, of which Xxxxxxx Leasing,
Inc. is the lessor and a responsible commercial user is the lessee,
pursuant to which such lessee is obligated to make periodic rental payments
to Xxxxxxx Leasing, Inc. (x) during a fixed minimum term of at least one
(1) year in duration, or (y) during a fixed minimum period of less than one
year, provided that leases with a fixed minimum period of less than one
year shall not constitute more than 25% of all leases.
"Lease in Good Standing" shall mean a Lease which is not delinquent more
than 60 days and no other default has occurred and remains uncured for a
period of 90 days.
"L/C Obligations" shall mean at any time the sum of (a) the aggregate
undrawn amount of all Standby Letters of Credit then outstanding, issued by
First Union at the request of the Borrowers, plus (b) the amount of all
unreimbursed drawings under all such Standby Letters of Credit.
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"Leverage Ratio" shall mean the ratio of Indebtedness (excluding
Subordinated Indebtedness) plus the net present value (in calculating the
net present value the discount rate shall be 10%) of Future Lease
Obligations plus L/C Obligations to Tangible Net Worth.
"LIBO Rate" shall mean the arithmetic average of the rates of interest per
annum (rounded upwards, if necessary to the next 1/16 of 1%) at which First
Union National Bank, individually, is offered deposits of United States
Dollars by leading banks in the interbank eurodollar or eurocurrency market
on or about eleven o'clock (11:00) a.m. London time two London Business
Days prior to the commencement of the requested Interest Period in an
amount substantially equal to the outstanding principal amount of the LIBO
Rate Loan requested for a maturity of comparable duration to the Interest
Period.
"LIBO Rate Loan" shall mean a Loan made at Adjusted LIBO Rate plus the LIBO
Rate Margin, pursuant to a request for advance made under ss. 2.4 herein.
"LIBO Rate Margin" shall mean the percentage listed in the following table.
Fixed Charge Coverage Ratio LIBO Rate Margin
Less than 1.25 1.750%
Equal to or greater than 1.25 but less than 1.50 1.375%
Equal to or greater than 1.50 but less than 1.75 1.125%
Equal to or greater than 1.75 0.875%
with such Fixed Charge Coverage Ratio to be computed as of the last
quarterly compliance period.
"LIBO Market Index Rate" shall mean for any day the rate (rounded upwards,
if necessary to the next 1/16 of 1%) for one (1) month U.S. dollar deposits
as reported on Telerate page 3750 as of 11:00 a.m. London Time for such
day, provided if such day is not a London Business Day, then the
immediately preceding London Business Day (or if not so reported, then as
determined by First Union from another recognized source or interbank
quotation).
"Lien" shall mean any lien, mortgage, security interest, chattel mortgage,
pledge or other encumbrance (statutory or otherwise) of any kind securing
satisfaction of an obligation, including any agreement to give any of the
foregoing, any conditional sales or other title retention agreement, any
lease in the nature thereof, and the filing of or the agreement to give any
financing statement under the Uniform Commercial Code of any jurisdiction
or similar evidence of any encumbrance, whether within or outside the
United States.
"Loan" or "Loans" shall mean LIBO Rate or Base Rate Loan or Loans.
"Loan Commitment" shall have the meaning set forth in ss. 2.1.
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"Loan Commitment Fee" shall have the meaning set forth in ss. 2.6.
"Loan Commitment Percentage" shall mean with respect to each Bank the
percentage set forth opposite its name in Exhibit A hereto.
"Loan Documents" shall mean this Agreement, the Notes, the Security
Agreement, and all other documents directly related or incidental to said
documents, the Loans or the Collateral.
"Material Adverse Effect" shall mean (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) of the Borrowers taken as a whole or
MLI; (b) a material impairment of the ability of the Borrowers to perform
under any Loan Document and to avoid any Event of Default; or (c) a
material adverse effect upon (i) the legality, validity, binding effect or
enforceability against the Borrowers of any Loan Document, or (ii) the
perfection or priority of any Lien granted under any of the Collateral
Documents.
"Multiemployer Plan" shall mean a multiemployer plan as defined in ERISA
ss. 4001(a)(3), which covers employees of any Borrower or any ERISA
Affiliate.
"Net Book Value of Eligible Revenue Equipment" shall mean the acquisition
cost of a Vehicle (a) less accumulated depreciation thereon, (b) plus the
cost of improvements capitalized in accordance with GAAP, (c) plus an
allowance for tires, rims and tubes installed on the Vehicle in the amount
of 75% of the cost of such tires and tubes.
"Note" or "Notes" shall have the meaning set forth in ss. 2.3.
"Obligations" shall mean all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Borrowers
to the Banks or any Indemnified Person, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising.
"Organization Documents" means, for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or
instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" shall mean, at any time, any Plan (including a Multiemployer
Plan), the funding requirements of which (under ERISA ss. 302 or Code ss.
412) are, or at any time within
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the six years immediately preceding the time in question, were in whole or
in part, the responsibility of the Company or any ERISA Affiliate.
"Permitted Liens" shall mean (a) any Lien (other than a Lien on the
Collateral) existing on property of any of the Borrowers or any Subsidiary
on the Closing Date and set forth in Schedule 1 securing Indebtedness
outstanding on such date; (b) any Lien created under any Loan Document; (c)
Liens for taxes, fees, assessments or other governmental charges which are
not delinquent or remain payable without penalty, or to the extent that
non-payment thereof is permitted hereunder, provided that no notice of lien
has been filed or recorded under the Code; (d) carriers', warehousemen's,
mechanics', landlords', materialmen's, repairmen's or other similar Liens
arising in the ordinary course of business which are not delinquent or
remain payable without penalty or which are being contested in good faith
and by appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property subject thereto, (e)
Liens (other than any Lien imposed by ERISA and other than on the
Collateral) consisting of pledges or deposits required in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other social security legislation; (f) Liens (other than
Liens on the Collateral) on the property of any of the Borrowers or any
Subsidiary securing (i) the nondelinquent performance of bids, trade
contracts (other than for borrowed money), leases, statutory obligations
which do not exceed in the aggregate $15,000,000, (ii) contingent
obligations on surety and appeal bonds, and (iii) other non-delinquent
obligations of a like nature; in each case, incurred in the ordinary course
of business, provided all such Liens in the aggregate would not (even if
enforced) cause a Material Adverse Effect; (g) Liens (other than Liens on
the Collateral) consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all
such liens in the aggregate at any time outstanding for any Borrower and
its Subsidiaries do not exceed 10% of Consolidated Net Worth; (h)
easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate, are
not substantial in amount, and which do not in any case materially detract
from the value of the property subject thereto or interfere with the
ordinary conduct of the businesses of any Borrower and any Subsidiary; (i)
purchase money security interests on any property acquired or held by any
Borrower or any Subsidiary in the ordinary course of business, securing
Indebtedness incurred or assumed for the purpose of financing all (or any
part of the cost of acquiring such property; provided that (1) any such
Lien attaches to such property concurrently with or within 60 days after
the acquisition thereof, (2) such Lien attaches solely to the property so
acquired in such transaction, (3) the principal amount of the debt secured
thereby does not exceed 100% of the cost of such property, and (4) the
aggregate amount of such Indebtedness incurred in connection with this
subsection (i) shall not exceed $40,000,000.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, company, business trust or entity, or other entity of
whatever nature.
"Plan" shall mean an employee benefit plan as defined in ss. 3(3) of ERISA,
other than a Multiemployer Plan, whether formal or informal and whether
legally binding or not.
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"Potential Default" shall mean an event, condition or circumstance that
with the giving of notice or lapse of time or both would become an Event of
Default.
"Regulation" shall mean any statute, law, ordinance, regulation, order or
rule of any United States or foreign, federal, state, local or other
government or governmental body, including, without limitation, those
covering or related to banking, financial transactions, securities, public
utilities, environmental control, energy, safety, health, transportation,
bribery, record keeping, zoning, antidiscrimination, antitrust, wages and
hours, employee benefits, and price and wage control matters.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System, as it may be amended from time to time.
"Regulatory Change" shall mean any change after the date of this Agreement
in any Regulation (including Regulation D) or the adoption or making after
such date of any interpretations, directives or requests of or under any
Regulation (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof applying to a class of banks including any one of
the Banks but excluding any foreign office of any Bank.
"Rental and Lease Expense" shall mean all rental payments paid under
operating leases.
"Reportable Event" shall mean, with respect to a Pension Plan: (a) Any of
the events set forth in ERISA ss. ss. 4043(b) (other than a reportable
event as to which the provision of 30 days' notice to the PBGC is waived
under applicable regulations) or 4063(a) or the regulations thereunder, (b)
an event requiring any Borrower or any ERISA Affiliate to provide security
to a Pension Plan under Code ss. 401(a)(29) and (c) any failure by any
Borrower or any ERISA Affiliate to make payments required by Code ss.
412(m).
"Request for Advance" shall have the meaning set forth in ss. 2.4.
"Required Banks" at any time shall mean Banks whose Loan Commitments equal
or exceed 51% of the total of such Loan Commitments if no Loans are
outstanding or, if Loans are outstanding, Banks whose outstanding Loans
equal or exceed 51% of the Loans.
"Requirement of Law" means, as to any Person, any Law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of
a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"Reserve Percentage" shall mean, for any LIBO Rate Loan for any Interest
Period, the daily average of the stated maximum rate (expressed as a
decimal) at which reserves (including
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any marginal, supplemental, or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by First Union
National Bank against "Eurocurrency liabilities" (as such term is used in
Regulation D) but without benefit of credit proration, exemptions, or
offsets that might otherwise be available to the Bank from time to time
under Regulation D. Without limiting the effect of the foregoing, the
Reserve Percentage shall reflect any other reserves required to be
maintained by the Bank against (1) any category of liabilities which
includes deposits by reference to which the rate for LIBO Rate Loans is to
be determined; or (2) any category of extension of credit or other assets
which include LIBO Rate Loans. The Adjusted LIBO Rate shall be adjusted on
and as of the effective day of any change in the Reserve Percentage.
"Responsible Officer" shall mean the chief executive officer or the
president of the Company, or any other officer having substantially the
same authority and responsibility; or, with respect to compliance with
financial covenants, the chief financial officer, the treasurer or the
controller of the Company, or any other officer having substantially the
same authority and responsibility.
"Revolver Termination Date" shall have the meaning set forth in ss. 2.1.
"Revolving Credit Loan" shall have the meaning set forth in ss. 2.1.
"Revolving Credit Note" shall have the meaning set for in ss. 2.2.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Security Agreement" shall mean the Security Agreement in the form and
substance attached hereto as Exhibit E.
"Solvent" shall mean, with respect to any Person, that the aggregate
present fair saleable value of such Person's assets is in excess of the
total amount of its probable liabilities on its existing debts as they
become absolute and matured, such Person has not incurred debts beyond its
foreseeable ability to pay such debts as they mature, and such Person has
capital adequate to conduct the business it is presently engaged in or is
about to engage in.
"Standby Letter of Credit" shall mean only those standby letters of credit
issued pursuant to a completed application on the form of letter of credit
application required by First Union at the time of the request for each
Standby Letter of Credit.
"Subordinated Indebtedness" shall mean all indebtedness which is
subordinated to the indebtedness under the Loan Documents in form and
substance satisfactory to the Banks in their reasonable opinion.
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"Subsidiary" shall mean a corporation or other entity the shares of stock
or other equity interests of which having ordinary voting power (other than
stock or other equity interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors
or other managers of such corporation are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through
one or more intermediaries or both, by the Borrowers.
"Tangible Net Worth" shall mean with respect to the Company and its
Subsidiaries the sum of (i) the Consolidated Net Worth of the Company and
its Subsidiaries at any time determined in accordance with GAAP plus (ii)
the amount remaining outstanding at such time of any Subordinated
Indebtedness, less (iii) Intangible Assets.
"Unfunded Pension Liability" shall mean the excess of a Plan's benefit
liabilities under ss. 4001(a)(16) of ERISA, over the current value of that
Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to ss. 412 of the Code for the applicable
plan year.
"Unused Fee Percentage" shall mean the percentage listed in the following
table.
Fixed Charge Coverage Ratio Unused Fee Percentage
Less than 1.25 0.375%
Equal to or greater than 1.25 but less than 1.50 0.375%
Equal to or greater than 1.50 but less than 1.75 0.250%
Equal to or greater than 1.75 0.250%
with such Fixed Charge Coverage Ratio to be computed as of the last
quarterly compliance period.
"Vehicle" shall mean a revenue-producing truck, truck-tractor, trailer,
container or other similar unit, and all related equipment and accessories,
now or hereafter owned by the Borrowers.
"Wholly-Owned Subsidiary" shall mean any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of
each class having ordinary voting power, and 100% of the capital stock of
every other class, in each case, at the time as of which any determination
is being made, is owned, beneficially and of record, by the Borrowers, or
by one or more of the other Wholly-Owned Subsidiaries, or both.
"Year 2000 Problem" shall mean the risk that computer applications may be
unable to recognize, and perform properly, date-sensitive functions
involving certain dates prior to and after December 31, 1999.
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1.2. Accounting Terms. All accounting terms not specifically defined herein
shall be construed in accordance with Generally Accepted Accounting Principles
consistent with those applied in the preparation of the financial statements
referred to in ss. 5.1, and all financial data submitted pursuant to this
Agreement shall be prepared in accordance with such principles; provided,
however, that if there is a change in GAAP which adversely affects the
calculation of the financial covenants set forth in this Agreement, the
Borrowers and the Banks shall negotiate in good faith to amend the financial
covenants herein.
2. The Credit
2.1. The Loans. Subject to the terms and conditions herein set forth and in
reliance upon the representations, warranties and covenants contained herein,
each Bank agrees, severally and not jointly, to make loans (collectively, the
"Loans", and individually a "Loan") to the Borrowers during the period beginning
on the date hereof and ending on August __, 2000 or on the earlier date of
termination in full, pursuant to ss. 2.7 or ss. 8.1 hereof, of the obligations
of such Bank under this ss. 2.1 (August __, 2000 or such earlier date of
termination being herein called the "Revolver Termination Date") in amounts not
to exceed at any time outstanding, in the aggregate, the commitment amount set
forth opposite the name of such Bank on Exhibit A hereto (each such amount, as
the same may be reduced pursuant to ss. 2.7 hereof being hereinafter called such
Bank's "Loan Commitment"). The Banks' collective commitment to make Loans shall
be the "Aggregate Loan Commitment". All Loans shall be made by the Banks
simultaneously and pro rata in accordance with their respective Loan
Commitments. All Loans shall be made to the Borrowers at the main office of
First Union, Broad and Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000.
Loans made hereunder may either be revolving credit loans ("Revolving
Credit Loans"), term loans (herein called "Term Loans") or short term advances
("Short Term Advances"), as requested by the Borrowers. As provided below,
Revolving Credit Loans, Term Loans and Short Term Advances may be requested by
the Borrowers, and made by the Banks, at any time and from time to time prior to
the Revolver Termination Date. No request for Loan will be considered by the
Banks if and to the extent the aggregate amount outstanding in respect of all
Loans at any time would exceed the lesser of the Aggregate Loan Commitment or
the Borrowing Base.
(a) Revolving Credit Loans. Borrowers may request Revolving Credit Loans
from time to time up to but not including the Revolver Termination Date.
Revolving Credit Loans shall be Base Rate Loans or LIBO Rate Loans. All
Revolving Credit Loans shall mature and be due and payable on the Revolver
Termination Date; provided, however, that all Revolving Credit Loans due and
payable on the Revolver Termination Date may be converted to a Term Loan, such
Term Loan to mature 48 months from the Revolver Termination Date and be payable
in equal quarterly installments of principal together with all accrued and
unpaid interest thereon.
(b) Term Loans. Borrowers may request Term Loans from time to time and on
the Revolver Termination Date; provided, however, that all Term Loans together
shall not exceed an aggregate principal amount outstanding at any time of
$30,000,000 from the date hereof through the Revolver
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Termination Date. Term Loans may be Base Rate Loans or LIBO Rate Loans, as may
be requested by the Borrowers . Term Loans shall mature and be payable in equal
quarterly installments of principal (together with all accrued and unpaid
interest thereon) over the period requested by the Borrowers at the time of the
Request for Advance which period shall not exceed 60 months.
(c) Short Term Advances. The Agent, in its individual capacity and under
the terms and subject to the conditions of this Agreement, shall provide
advances (herein called "Short Term Advances" or "Advances") to Borrowers, from
time to time, as requested by Borrowers, provided that:
(i) the aggregate amount of Short Term Advances outstanding at any one
time shall not exceed $5,000,000 or such lesser amount, if any, as will,
when added to the amount of the Loans then outstanding, aggregate more than
the Aggregate Loan Commitment (or such lesser amount as Borrowers are
entitled to borrow hereunder at such time by reason of the limitation of
the Borrowing Base or otherwise),
(ii) no Short Term Advance shall be outstanding for more than seven
Business Days, and
(iii) no Short Term Advance shall be permitted if within the preceding
seven Business Days there shall not have been at least one day on which no
Short Term Advance shall have been outstanding.
Borrowers shall request a Short Term Advance by delivering a Request For
Short Term Advance (in such form as may be reasonably requested by First Union,
from time to time, the "Request") signed by a Responsible Officer to First
Union, as Agent on or before the date the Short Term Advance is to be made. Upon
receipt of such Request and if the conditions provided herein shall be satisfied
at the time of such receipt, the Agent shall make the Short Term Advance on the
date specified therein.
Short Term Advances shall bear interest at the LIBO Market Index Rate. If
on the seventh Business Day following the making of any Short Term Advance, the
Advance is not repaid by the Company the amount due shall be funded
automatically by a Revolving Credit Loan which Loan shall be made without regard
to any minimum borrowing requirement, condition precedent herein, or Event of
Default hereunder which would otherwise entitle any Bank or the Banks not to
provide such Revolving Credit Loan, and each Bank shall make its proportionate
share of such Revolving Credit Loan.
Within the foregoing limit, Borrowers may request Short Term Advances, pay
them within seven Business Days and request new Short Term Advances. It is
intended, and Borrowers agree, that the Short Term Advance facility shall be
used only for its convenience and need for very short term funds. This facility
shall not be used as a substitute for Revolving Credit Loans by continuously
maintaining a significant amount of Short Term Advances outstanding.
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All Short Term Advances shall be repaid by Borrowers at the Revolver
Termination Date.
(d) Limit for Xxxxxxx Leasing, Inc. Borrowers may have Loans outstanding at
any time and from time to time in an aggregate amount up to, but not exceeding
$30,000,000 for borrowings specifically to Xxxxxxx Leasing, Inc.
(e) Interest Rate Options. Loans shall bear interest at (i) the Base Rate,
(ii) Adjusted LIBO Rate plus the LIBO Rate Margin or (iii) some combination of
the foregoing, as requested by the Borrowers, subject to the terms and
conditions hereof including the requirements concerning minimum Loan requests
and the requirements that (i) no request may be made which would require more
than one interest rate option or more than one Interest Period to apply to Loans
made on any single date, and (ii), in the case of LIBO Rate Loans, (a) not more
than five such Loans may be outstanding at any one time, and (b) no LIBO Rate
Loan may have an Interest Period extending beyond the Revolver Termination Date.
(f) Maximum Loans Outstanding. Borrowers shall not be entitled to any new
Loan if, after giving effect to such Loan, the unpaid amount of the then
outstanding Loans would exceed the lesser of (i) the Aggregate Loan Commitment
or (ii) the then current Borrowing Base, as stated in the most recent Borrowing
Base Certificate furnished to the Banks as provided herein. For purposes of
determining the amount of Loans outstanding, the Standby Letters of Credit
issued pursuant to ss. 2.2 hereof shall be deemed Loans and shall be added to
the Loans outstanding to determine the aggregate Loans outstanding.
(g) Minimum Loan Amount. Except for Loans which exhaust the full remaining
amount of the Aggregate Loan Commitment which may be in lesser amount, (i) each
Term Loan when made shall be in an amount at least equal to $5,000,000 or, if
greater, then in such minimum amount plus $100,000 multiples , (ii) each
Revolving Credit Loan when made shall be in an amount at least equal to
$150,000, (iii) each LIBO Rate Loan when made (and each conversion of Base Rate
Loans into LIBO Rate Loans) shall be in an amount at least equal to $1,000,000
or, if greater, then in such minimum amount plus $100,000 multiples, and (iv)
each Base Rate Loan when made (and each conversion of LIBO Rate Loans into Base
Rate Loans) shall be in an amount at least equal to $150,000.
(h) Prepayment and Reborrowing. Prior to the Revolver Termination Date and
within the limits of the Aggregate Loan Commitment and the Borrowing Base,
Borrowers may borrow, prepay and reborrow Revolving Credit Loans. Except as
provided in ss. 2.1(a) hereof, all Revolving Credit Loans shall mature and be
due and payable on the Revolver Termination Date.
(i) Extensions of the Revolver Termination Date. Not less than 90 days
prior to the Revolver Termination Date, Borrowers may request in writing to
First Union that the Revolver Termination Date be extended for a new 364-day
period. Upon receipt of such request, First Union will promptly distribute
notice of such request to the Banks. The Banks shall notify First Union no less
than 60 days prior to the Revolver Termination Date of their willingness to
establish a new date. If all Banks agree to a new Revolver Termination Date,
First Union, on or before the 30th day prior to the existing Revolver
Termination Date, shall advise Borrowers and the Banks, in writing, that
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the Revolver Termination Date has been extended for 364 days (stating the date
of the new Revolver Termination Date) and this Agreement shall be deemed amended
to such extent.
(j) Loan Commitment Percentages. The obligation of each Bank to make a Loan
to Borrowers at any time shall be limited to its percentage (the "Loan
Commitment Percentage") as set forth opposite its name on Exhibit A hereto
multiplied by the aggregate principal amount of the Loan requested. The
principal amounts of the respective Loans made by the Banks on the occasion of
each Borrowing shall be pro rata in accordance with their respective Loan
Commitment Percentages. No Bank shall be required or permitted to make any Loan
if, immediately after giving effect to such Loan, and the application of the
proceeds of a Loan to the extent applied to the repayment of the Loans, the sum
of such Bank's Loans outstanding would exceed such Bank's Loan Commitment.
(k) Several Obligations. The failure of any one or more Banks to make Loans
in accordance with its or their obligations shall not relieve the other Banks of
their several obligations hereunder, but in no event shall the aggregate amount
at any one time outstanding which any Bank shall be required to lend hereunder
exceed its Loan Commitment.
(l) Payment of Additional Amount. If any principal of a LIBO Rate Loan
shall be repaid (whether upon prepayment, reduction of the Aggregate Loan
Commitment after acceleration or for any other reason) or converted to a Base
Rate Loan prior to the last day of the Interest Period applicable to such LIBO
Rate Loan or if Borrowers fail for any reason to borrow a LIBO Rate Loan after
giving irrevocable notice pursuant to ss. 2.4, it shall pay to each Bank, in
addition to the principal and interest then to be paid, such additional amounts
as may be necessary to compensate each Bank for all direct and indirect costs
and losses (including losses resulting from redeployment of prepaid or
unborrowed funds at rates lower than the cost of such funds to such Bank, and
including lost profits incurred or sustained by such Bank) as a result of such
repayment or failure to borrow (the "Additional Amount"). The Additional Amount
(which each Bank shall take reasonable measures to minimize) shall be specified
in a written notice or certificate delivered to Borrowers by First Union, as
Agent, in the form provided by each Bank sustaining such costs or losses. Such
notice or certificate shall contain a calculation in reasonable detail of the
Additional Amount to be compensated and shall be conclusive as to the facts and
the amounts stated therein, absent manifest error.
2.2. Standby Letters of Credit. First Union, as Agent, under the terms and
subject to the conditions of this Agreement, on behalf of itself and each other
Bank in the same proportions as each Bank's Loan Commitment bears to the
Aggregate Loan Commitment, shall provide Standby Letters of Credit to Borrowers,
from time to time prior to the Revolver Termination Date, as requested by
Borrowers, provided that (A) the aggregate amount of Standby Letters of Credit
outstanding at any one time shall not exceed $12,000,000 or such lesser amount,
if any, as will, when added to the amount of the Loans then outstanding,
aggregate more than the Aggregate Loan Commitment (or such lesser amount as
Borrowers are entitled to borrow hereunder at such time by reason of the
limitation of the Borrowing Base or otherwise), and (B) no Standby Letter of
Credit shall be for a term longer than one year or the Revolver Termination
Date, whichever is less.
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Borrowers shall request a Standby Letter of Credit by delivering a
completed letter of credit application to First Union on such form as may be
specified by First Union not less than three Business Days prior to the date
specified by Borrowers as the date the Standby Letter of Credit is to be issued.
The standard form of First Union letter of credit application as currently in
effect shall be used.
Standby Letters of Credit shall not bear interest until drawn upon but
shall each be subject to an annual charge, payable quarterly in arrears on the
last Business Day of each calendar quarter from the date of issuance, equal to
the LIBO Rate Margin as currently in effect on the average daily maximum amount
available to be drawn on the outstanding Standby Letters of Credit, computed on
a quarterly basis in arrears on the last Business Day of each calendar quarter
based upon Standby Letters of Credit outstanding for that quarter as calculated
by First Union on behalf of the Banks. Borrowers shall also pay an annual fee to
First Union, as Agent, for its own account, payable quarterly in arrears on the
last Business Day of each calendar quarter from the date of issuance, equal to
0.125% of the average daily maximum amount available to be drawn on the
outstanding Standby Letters of Credit, computed on a quarterly basis in arrears
on the last Business Day of each calendar quarter based upon Standby Letters of
Credit outstanding for that quarter as calculated by First Union on behalf of
the Banks.
If any obligation of Borrowers to pay money in connection with any Standby
Letter of Credit is not met when requested by First Union, as Agent, as
permitted by the applicable letter of credit application and the reimbursement
agreement contained therein, the amount due shall be funded automatically by a
Loan which Loan shall be made without regard to any minimum borrowing
requirement, condition precedent herein, or Event of Default hereunder which
would otherwise entitle any Bank or the Banks not to provide such Loan, and each
Bank shall make its proportionate share of such Loan. Any obligation of
Borrowers to pay money in connection with any Standby Letter of Credit or the
application therefor shall be deemed secured as if made as a Loan hereunder. In
the event Borrowers shall terminate the Aggregate Loan Commitment as provided in
ss. 2.6 and shall pay the outstanding principal amount of the Loans in full and
with interest or the Revolver Termination Date shall occur at a time when one or
more Standby Letters of Credit remain outstanding, then Borrowers shall furnish
to First Union, as Agent, within two Business Days such amount of cash, to be
held as cash collateral and invested in certificates of deposit of First Union
with interest payable to Borrowers, as will pay the maximum amount which may be
drawn by beneficiaries of Standby Letters of Credit outstanding at the date of
such termination or the Revolver Termination Date, as applicable.
2.3. The Notes.
(a) Revolving Credit Notes. The Revolving Credit Loans made by each Bank
shall be evidenced by a single promissory note of Borrowers (each such
promissory note as it may be amended, extended, modified or renewed a "Revolving
Credit Note" and together the "Revolving Credit Notes") in principal face amount
equal to such Bank's Loan Commitment, payable to the order of such Bank and
otherwise in the form attached hereto as Exhibit B. The Revolving Credit Notes
shall be dated the date of issuance, shall bear interest at the rate per annum
and be payable as to
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principal and interest in accordance with the terms hereof. Each outstanding
Revolving Credit Loan shall be due and payable as set forth in ss. 2.1 hereof
unless the maturity of said Loans is accelerated as provided in ss. 2.7 or ss.
8.1 hereof. Notwithstanding the stated amount of any Revolving Credit Note, the
liability of Borrowers under each Revolving Credit Note shall be limited at all
times to the outstanding principal amount of the Revolving Credit Loans by each
Bank evidenced thereby, plus all interest accrued thereon and the amount of all
costs and expenses then payable hereunder, as established by each such Bank's
books and records, which books and records shall be conclusive absent manifest
error.
(b) Term Notes. The Term Loans made by each Bank at each Borrowing shall be
evidenced by a single promissory note of Borrowers (each such promissory note as
it may be amended, extended, modified or renewed a "Term Note" and together the
"Term Notes" and together with the Revolving Credit Notes, the "Notes") in
principal face amount equal to such Bank's Loan Commitment Percentage of the
aggregate Term Loans made to Borrowers on the date of any Borrowing, payable to
the order of such Bank and otherwise in the form attached hereto as Exhibit C.
The Term Notes shall be dated the date of the applicable borrowing, shall bear
interest at the rate per annum and be payable as to principal in equal quarterly
installments over the number of months to final maturity as requested by
Borrowers and specified in the Term Note, and be payable as to interest in the
amount of the accrued interest at the date of the monthly payment.
2.4. Funding Procedures.
(a) Request for Advance. Each request for a Loan or the conversion or
renewal of an interest rate with respect to a Loan shall be made not later than
11:00 a.m. EST on a Business Day by delivery to First Union of a written request
signed by Borrowers or, in the alternative, a telephone request followed
promptly by written confirmation of the request (a "Request for Advance"),
specifying the date and amount of the Loan to be made, converted or renewed,
selecting the interest rate option applicable thereto, and in the case of LIBO
Rate Loans, specifying the Interest Period applicable to such Loans. The form of
request to be used in connection with the making, conversion or renewal of Loans
shall be that form provided to Borrowers by First Union. Each request shall be
received on the Business Day of the proposed borrowing, conversion or renewal in
the case of Base Rate Loans, and two London Business Days prior to the date of
the proposed borrowing, conversion or renewal in the case of LIBO Rate Loans. No
request shall be effective until actually received in writing by First Union, as
the Agent. Borrowers may not request more than one advance per day. Each request
for advance shall be for Loans at a single interest rate option.
(b) Actions by Agent. Upon receipt of a Request for Advance and if the
conditions precedent provided herein shall be satisfied at the time of such
request, First Union promptly shall notify each Bank of such request and of such
Bank's ratable share of such Loan. Upon receipt by First Union of a Request for
Advance, the request shall not be revocable by Borrowers.
(c) Availability of Funds. Not later than 2:00 p.m. EST on the date of each
Loan, each Bank shall make available (except as provided in clause (d) below)
its ratable share of such Loan, in immediately available funds, to First Union
at the address set forth opposite its name on the signature page hereof or at
such account in London as First Union shall specify to Borrowers and the Banks.
Unless First Union knows that any applicable condition specified herein has not
been satisfied, it will make the funds so
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received from the Banks immediately available to Borrowers on the date of each
Loan by a credit to the account of Borrowers at First Union' aforesaid address.
(d) Funding Assumptions. Unless First Union shall have been notified by any
Bank at least one Business Day prior to the date of the making, conversion or
renewal of any LIBO Rate Loan, or by 3:00 P.M. on the date a Base Rate Loan is
requested, that such Bank does not intend to make available to First Union, such
Bank's portion of the total amount of the Loan to be made, converted or renewed
on such date, First Union may assume that such Bank has made such amount
available to First Union on the date of the Loan and First Union may, in
reliance upon such assumption, make available to Borrowers a corresponding
amount. If and to the extent such Bank shall not have so made such funds
available to First Union, such Bank agrees to repay First Union forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to Borrowers until the date such
amount is repaid to First Union, at the Federal Funds Rate plus 50 basis points
for three Business Days, and thereafter at the Base Rate. If such Bank shall
repay to First Union such corresponding amount, such amounts so repaid shall
constitute such Bank's Loan for purposes of this Agreement. If such Bank does
not repay such corresponding amount forthwith upon First Union's demand
therefor, First Union shall promptly notify Borrowers, and Borrowers shall
immediately pay such corresponding amount to First Union, without any prepayment
penalty or premium, but with interest on the amount repaid, for each day from
the date such amount is made available to Borrowers until the date such amount
is repaid to First Union, at the rate of interest applicable at the time to such
Loan. Nothing herein shall be deemed to relieve any Bank of its obligation to
fulfill its Revolving Loan Commitment hereunder or to prejudice any rights which
Borrowers may have against any Bank as a result of any default by such Bank
hereunder.
(e) Proceeds of Loan Being Repaid. If the Banks make a Loan on a day on
which all or any part of an outstanding Loan from the Banks is to be repaid,
each Bank shall apply the proceeds of its new Loan to make such repayment and
only an amount equal to the difference (if any) between the amount being
borrowed and the amount being repaid shall be made available by such Bank to
First Union as provided in clause (c).
2.5. Interest.
(a) Base Rate Loans. Each Base Rate Loan shall bear interest on the unpaid
principal balance thereof from day to day at a rate per annum which at all times
shall be equal to the Base Rate. Interest on Loans shall be computed on the
basis of a year of 365 or 366 days, as applicable, if the Base Rate is equal to
the prime rate of First Union. Interest on Loans shall be computed on the basis
of a year of 360 days, for the actual days elapsed, if the Base Rate is equal to
the Federal Funds Rate plus 1/2 of 1% annum.
(b) LIBO Rate Loans. Each LIBO Rate Loan shall bear interest from its
effective date on the unpaid principal amount thereof at Adjusted LIBO Rate plus
the LIBO Rate Margin. Interest on LIBO Rate Loans shall be computed on the basis
of a year of 360 days, for the actual days elapsed. Accrued interest on LIBO
Rate Loans with Interest Periods of three months or less shall be due and
payable on the last day of such Interest Period. Accrued interest on LIBO Rate
Loans with Interest Periods of more than three months shall be due and payable
at the end of the third month and on the last day of each three month period
thereafter and on the last day of the Interest Period.
(c) Conversion to Base Rate. Unless Borrowers shall have elected in
accordance with the provisions of ss. 2.4 or this ss. 2.5 that LIBO Rate apply
to the one, two, three or six month period immediately
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succeeding a particular Interest Period, upon the termination of such Interest
Period the applicable Loan shall bear interest at the Base Rate until such time
as Borrowers elect to request a new LIBO Rate Loan for a subsequent Interest
Period.
(d) Renewals and Conversions. Borrowers shall have the right to convert
Base Rate Loans into LIBO Rate Loans, and vice versa, and to renew LIBO Rate
Loans from time to time, provided that: (i) Borrowers shall give First Union, as
Agent, notice of each permitted conversion or renewal; (ii) LIBO Rate Loans may
be converted or renewed only as of the last day of the applicable Interest
Period for such Loans; (iii) without the consent of the Required Banks, no Base
Rate Loan may be converted into a LIBO Rate Loan, and no Interest Period may be
renewed if on the proposed date of conversion an Event of Default, or Potential
Default exists or would thereby occur. First Union, as Agent, shall use its best
efforts to notify Borrowers of the effectiveness of such conversion or renewal,
and the new interest rate to which the converted or renewed Loan is subject, as
soon as practicable after the conversion; provided, however, that any failure to
give such notice shall not affect Borrowers' obligations or the Banks' rights
and remedies hereunder in any way whatsoever.
(e) Interim Payments At Base Rate. If at any time Borrowers request that
Adjusted LIBO Rate plus the LIBO Rate Margin be applicable to a Loan for a
particular Interest Period and a payment of principal is due within such period
(other than on the last day of such Interest Period), only that portion of that
Loan equal to the outstanding principal amount of the Loan less the principal
installment due during such period shall bear interest at Adjusted LIBO Rate
plus the LIBO Rate Margin for such Interest Period. The portion of that Loan
equal to the principal installment due during such period shall bear interest at
the Base Rate.
(f) Reinstatements. The liability of Borrowers under this ss. 2.5 shall
continue to be effective or be automatically reinstated, as the case may be, if
at any time payment, in whole or in part, of any of the payments to the Banks is
rescinded or must otherwise be restored or returned upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of Borrowers or any other
Person, or upon or as a result of the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to Borrowers or any
other Person or any substantial part of its property, or otherwise, all as
though such payment had not been made.
2.6. Fees.
(a) Closing Fee. Borrowers agree to pay to First Union, as Agent, for the
account of each Bank as compensation to such Bank on its allocation to the
facility a fee (the "Closing Fee") as follows:
Commitment Closing Fee
---------- -----------
$22,500,000 0.25%
$20,000,000 0.25%
$12,500,000 0.15%
The Closing Fee shall be payable on or before the date hereof.
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(b) Unused Commitment Fee. Borrowers agree to pay to First Union, as Agent,
for the account of each Bank as compensation for each Bank's Loan Commitment, a
fee (the "Unused Commitment Fee") computed at the applicable Unused Fee
Percentage per annum on the average daily amount of the unused portion of each
Bank's Loan Commitment accrued from and after the date hereof. The unused
portion of the each Bank's Loan Commitment shall mean each Bank's Loan
Commitment less the principal amount of the outstanding Loans and Standby
Letters of Credit issued hereunder. The Unused Commitment Fee shall be payable
in arrears on the first day of each January, April, July and October, commencing
October 1, 1998 (for the three month period or portion thereof ended on the
preceding day), and on the Revolver Termination Date. The Unused Commitment Fee
shall be calculated on the basis of of 365 or 366 days, as applicable, for the
actual days elapsed.
2.7. Reduction or Termination of Loan Commitments.
(a) Voluntary. Borrowers may at any time, on not less than one Business
Days' written notice, terminate or permanently reduce the Aggregate Revolving
Loan Commitment pro rata among the Banks, provided that any reduction shall be
in the minimum amount of $150,000 or a multiple thereof and that no such
reduction shall cause the principal amount of Loans outstanding to exceed the
reduced Aggregate Loan Commitment or the Borrowing Base, whichever is less.
(b) Loan Commitment Termination. In the event the Aggregate Loan Commitment
is terminated, the Revolver Termination Date shall be accelerated to the date of
such termination and Borrowers shall, simultaneously with such termination,
repay the Loans in accordance with ss. 2.9.
2.8. Voluntary Prepayments.
(a) Base Rate Loans. On one Business Day's notice to First Union, Borrowers
may, without penalty, at their option, prepay any Base Rate Loan in whole at any
time or in part from time to time, provided that each partial prepayment shall
be in the minimum principal amount of $100,000 or, if greater, then in multiples
thereof and, if less than $100,000 shall be outstanding, in principal amount
equal to amount remaining outstanding.
(b) LIBO Rate Loans. On three London Business Days' notice to First Union,
Borrowers may, without penalty, at their option, prepay any LIBO Rate Loan in
whole at any time or in part from time to time, provided that each partial
prepayment shall be in the minimum principal amount of $1,000,000 or, if
greater, then in multiples of $100,000 and, if less than $1,000,000 shall be
outstanding, in principal amount equal to amount remaining outstanding provided
that if it shall prepay a LIBO Rate Loan prior to the last day of the applicable
Interest Period, or shall fail to borrow any LIBO Rate Loan on the date such
Loan is to be made, it shall pay to each Bank, in addition to the principal and
interest then to be paid in the case of a prepayment, on such date of
prepayment, the Additional Amount incurred or sustained by such Bank as a result
of such prepayment or failure to borrow as provided in ss. 2.1.
2.9. Payments.
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(a) Accrued Interest. Accrued interest on all Base Rate Loans shall be due
and payable on the first Business Day of each calendar month. Accrued interest
on LIBO Rate Loans with Interest Periods of three months or less shall be due
and payable on the last day of such Interest Period. Accrued interest on LIBO
Rate Loans with Interest Periods of more than three months shall be due and
payable at the end of the third month and on the last day of each three month
period thereafter and on the last day of the Interest Period.
Interest on LIBO Rate Loans shall be payable on the last day of the applicable
Interest Period. Each Loan shall mature as provided in ss. 2.1.
(b) Form of Payments, Application of Payments, Payment Administration, Etc.
All payments of principal, interest, fees, or other amounts payable by Borrowers
hereunder shall be applied to the Loans in such order and to such extent as
shall be specified by Borrowers by written notice to First Union at the time of
such payment or prepayment for all payments prior to the Revolver Termination
Date. After the Revolver Termination Date and if Term Loans shall be in
existence, all payments of principal paid by Borrowers hereunder shall be
applied to the Term Loans shall first be applied to the payment then due with
any excess to be applied to payments due under the Term Loans in the inverse
order of their maturities. Such payments shall be remitted to First Union on
behalf of the Banks at the address set forth opposite its name on the signature
page hereof or at such office or account as First Union shall specify to
Borrowers, in immediately available funds not later than 2:00 p.m. on the day
when due. Whenever any payment is stated as due on a day which is not a Business
Day, the maturity of such payment shall, except as otherwise provided in the
definition of "Interest Period," be extended to the next succeeding Business Day
and interest and commitment fees shall continue to accrue during such extension.
Borrowers authorize First Union to deduct from any account of Borrowers
maintained at First Union or over which First Union has control any amount
payable under this Agreement, the Notes or any other Loan Document which is not
paid in a timely manner. First Union's failure to deliver any xxxx, statement or
invoice with respect to amounts due under this Section or under any Loan
Document shall not affect Borrowers's obligation to pay any installment of
principal, interest or any other amount under this Agreement when due and
payable.
(c) Demand Deposit Account. Borrowers shall maintain at least one demand
deposit account with First Union for purposes of this Agreement. Borrowers
authorize First Union to deposit into said account all amounts to be advanced to
Borrowers hereunder. Further, Borrowers authorize First Union (but First Union
shall not be obligated) to deduct from said account, or any other account
maintained by Borrowers at First Union National Bank, any amount payable
hereunder on or after the date upon which it is due and payable. Such
authorization shall include but not be limited to amounts payable with respect
to principal, interest, fees and expenses.
(d) Net Payments. All payments made to the Banks by Borrowers hereunder,
under any Note or under any other Loan Document will be made without set off,
counterclaim or other defense.
2.10. Change in Circumstances, Yield Protection.
(a) Certain Regulatory Changes. If any Regulatory Change or compliance by
any Bank with any request made after the date of this Agreement by the Board of
Governors of the Federal Reserve System or by any Federal Reserve Bank or other
central bank or fiscal, monetary or similar authority (in each case whether or
not having the force of law) shall (i) impose, modify or make applicable any
reserve, special deposit, Federal Deposit Insurance Corporation premium or
similar requirement or imposition against assets
-23-
held by, or deposits in or for the account of, or loans made by, or any other
acquisition of funds for loans or advances by, any Bank; (ii) impose on any Bank
any other condition regarding the Notes; (iii) subject any Bank to, or cause the
withdrawal or termination of any previously granted exemption with respect to,
any tax (including any withholding tax but not including any income tax not
currently causing any Bank to be subject to withholding) or any other levy,
impost, duty, charge, fee or deduction on or from any payments due from
Borrowers; or (iv) change the basis of taxation of payments from Borrowers to
any Bank (other than by reason of a change in the method of taxation of any
Bank's net income); and the result of any of the foregoing events is to increase
the cost to any Bank of making or maintaining any Loan or to reduce the amount
of principal, interest or fees to be received by any Bank hereunder in respect
of any Loan, First Union will immediately so notify Borrowers. If any Bank
determines in good faith that the effects of the change resulting in such
increased cost or reduced amount cannot reasonably be avoided or the cost
thereof mitigated, then upon notice by First Union to Borrowers, Borrowers shall
pay to such Bank on each interest payment date of the Loan, such additional
amount as shall be necessary to compensate that Bank for such increased cost or
reduced amount.
(b) Capital Adequacy. If any Bank shall determine that any Regulation
regarding capital adequacy or the adoption of any Regulation regarding capital
adequacy, which Regulation is applicable to banks (or their holding companies)
generally and not such Bank (or its holding company) specifically, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Bank (or its
holding company) with any such request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has the effect of reducing the rate of return on such Bank's
capital as a consequence of its obligations hereunder to a level below that
which such Bank could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, Borrowers shall
promptly pay to First Union for the account of such Bank, upon the demand of
such Bank, such additional amount or amounts as will compensate such Bank for
such reduction.
(c) Ability to Determine LIBO Rate. If First Union shall determine (which
determination will be made after consultation with any Bank requesting same and
shall be, in the absence of fraud or manifest error, conclusive and binding upon
all parties hereto) that by reason of abnormal circumstances affecting the
interbank eurodollar or applicable eurocurrency market adequate and reasonable
means do not exist for ascertaining the LIBO Rate to be applicable to the
requested LIBO Rate Loan or that eurodollar or eurocurrency funds in amounts
sufficient to fund all the LIBO Rate Loans are not obtainable on reasonable
terms, First Union shall give notice of such inability or determination by
telephone to Borrowers and to each Bank at least two Business Days prior to the
date of the proposed Loan and thereupon the obligations of the Banks to make,
convert other Loans to, or renew such LIBO Rate Loan shall be excused, subject,
however, to the right of Borrowers at any time thereafter to submit another
request.
(d) Yield Protection. Determination by a Bank for purposes hereof of the
effect of any Regulatory Change or other change or circumstance referred to
above on its costs of making or maintaining Loans or on amounts receivable by it
in respect of the Loans and of the additional amounts required to compensate
such Bank in respect of any additional costs, shall be made in good faith and
shall be evidenced by a certificate, signed by an officer of such Bank and
delivered to Borrowers, as to the fact and amount of
-24-
the increased cost incurred by or the reduced amount accruing to such Bank owing
to such event or events. Such certificate shall be prepared in reasonable detail
and shall be conclusive as to the facts and amounts stated therein, absent
manifest error.
(e) Notice of Events. The affected Bank will notify Borrowers of any event
occurring after the date of this Agreement that will entitle such Bank to
compensation pursuant to this Section as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation. Said
notice shall be in writing, shall specify the applicable Section or Sections of
this Agreement to which it relates and shall set forth the amount or amounts
then payable pursuant to this Section. Borrowers shall pay such Bank the amount
shown as due on such notice within 10 days after their receipt of the same.
2.11. Illegality. Notwithstanding any other provision in this Agreement, if
the adoption of any applicable Regulation, or any change therein, or any change
in the interpretation or administration thereof by any governmental authority,
central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank with any request or directive
(whether or not having the force of law) of any such authority, central bank, or
comparable agency shall make it unlawful or impossible for any Bank to (1)
maintain their Loan Commitments, then upon notice to Borrowers by First Union,
the Loan Commitments shall terminate; or (2) maintain or fund their LIBO Rate
Loans, then upon notice to the Borrowers of such event, the Borrowers'
outstanding LIBO Rate Loans shall be converted into Base Rate Loans.
2.12. Discretion of each Bank as to Manner of Funding. Notwithstanding any
provision of this Agreement to the contrary, each Bank shall be entitled to fund
and maintain its funding of all or any part of its Loans in any manner it sees
fit, it being understood, however, that for the purposes of this Agreement all
determinations hereunder shall be made as if each Bank had actually funded and
maintained each LIBO Rate Loan during each Interest Period for such Loan through
the purchase of deposits in the relevant interbank market having a maturity
corresponding to such Interest Period and bearing an interest rate equal to the
LIBO Rate plus the LIBO Rate Margin, for such Interest Period.
-25-
3. Representations and Warranties
Each of the Borrowers represents and warrants to the Banks that:
3.1. Corporate Existence and Power. Each of the Borrowers:
(a) is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;
(c) is duly qualified as a corporation and is licensed and in good standing
under the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification or license;
and
(d) is in compliance with all Requirements of Law; except, in each case
referred to in clause (b) or clause (c), to the extent that the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
3.2. Corporate Authorization; No Contravention. The execution, delivery and
performance by each of the Borrowers of this Agreement and each other Loan
Document to which such Borrower is party, has been duly authorized by all
necessary corporate action, and do not and will not:
(a) Contravene the terms of any of that Person's Organization Documents;
(b) Conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any Contractual Obligation
to which such Person is a party or any order, injunction, writ or decree of any
Governmental Authority to which such Person or its property is subject; or
(c) Violate any Requirement of Law.
3.3. Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (except for recordings or filings in connection with the
Liens granted to the Banks under the Collateral Documents) or third party is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, each of the Borrowers of the Agreement or any other
Loan Document.
3.4. Binding Effect. This Agreement and each other Loan Document to which
any of the Borrowers is a party constitute the legal, valid and binding
obligations of such Borrower to the extent
-26-
such Borrower is a party thereto, enforceable against such Borrower in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, or similar laws affecting the enforcement
of creditors' rights generally or by equitable principles relating to
enforceability.
3.5. Litigation. Except as specifically disclosed in Schedule 1, there are
no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of each of the Borrowers, threatened or contemplated, at law, in
equity, in arbitration or before any Governmental Authority, against any such
Borrower or any of its respective properties which:
(a) Purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby or
(b) If determined adversely to the Borrower, would reasonably be expected
to have a Material Adverse Effect. No injunction, writ, temporary restraining
order or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution, delivery
or performance of this Agreement or any other Loan Document, or directing that
the transactions provided for herein or therein not be consummated as herein or
therein provided.
3.6. No Default. No Event of Default or Potential Default exists or would
result from the incurring of any Obligations by any of the Borrowers or from the
grant or perfection of the Liens of the Bank on the Collateral. As of the
Closing Date, each of the Borrowers is not in default under or with respect to
any Contractual Obligation in any respect which, individually or together with
all such defaults, could reasonably be expected to have a Material Adverse
Effect, or that would, if such default had occurred after the Closing Date,
create an Event of Default under ss. 8.1.
3.7. ERISA Compliance. Except as specifically disclosed in Schedule 1, each
of the Borrowers is in material compliance with all statutes and governmental
rules and regulations applicable to it, including, without limitation, ERISA
insofar as such Act applies to it. Each Plan complies in all material respects
with all applicable statutes and governmental rules and regulations, and each of
the Borrowers is not aware that (i) any Reportable Event has occurred and is
continuing with respect to any Plan, (ii) any such Borrower or any ERISA
Affiliate has withdrawn from any Multiemployer Plan or instituted steps to do
so, and (iii) any steps have been instituted to terminate any Plan or
Multiemployer Plan, which such occurrence, withdrawal or termination has
resulted or would result in the incurrence by any Borrower of liability that
could reasonably be expected to have a Material Adverse Effect.
3.8. Use of Proceeds; Margin Regulations. The proceeds of the Loans are to
be used solely for the purposes set forth in and permitted hereunder. Each of
the Borrowers is not generally engaged in the business of purchasing or selling
Margin Stock or extending credit for the purpose of purchasing or carrying
Margin Stock.
-27-
3.9. Title to Properties. Each of the Borrowers has good record and
marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of its respective businesses,
except for such defects in title as could not, individually or in the aggregate,
have a Material Adverse Effect. As of the Closing Date, the property of each of
the Borrowers is subject to no Liens, other than Permitted Liens.
3.10. Taxes. Each of the Borrowers has filed all Federal and other material
tax returns and reports required to be filed, and has paid all Federal, state
and other material taxes, assessments, fees and other governmental charges
levied or imposed upon them or their properties, income or assets otherwise due
and payable, except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP. There is no proposed tax assessment against any Borrower that would,
if made, have a Material Adverse Effect.
3.11. Financial Condition.
(a) The audited consolidated financial statements of each of the Borrowers
dated September 30, 1997, and the related consolidated statements of income or
operations, shareholders equity and cash flows for the fiscal year ended on that
date:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject to ordinary, good faith year end audit adjustments;
(ii) fairly present the financial condition of such Borrower as of the
date thereof and results of operations for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 1, show all
material Indebtedness and other liabilities, direct or contingent, of such
Borrower as of the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(b) Since September 30, 1997, there has been no Material Adverse Effect.
3.12. Environmental Matters. Each of the Borrowers conducts in the ordinary
course of business a review of the effect of existing Environmental Laws and
existing environmental claims on its business, operations and properties, and as
a result thereof each of the Borrowers has reasonably concluded that, except as
specifically disclosed in Schedule 1, such Environmental Laws and environmental
claims could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
3.13. Regulated Entities. None of the Borrowers or any Person controlling
the Borrowers is an "Investment Company" within the meaning of the Investment
Company Act of 1940. None of the Borrowers is subject to regulation under the
Public Utility Holding Company Act of 1935,
-28-
the Federal Power Act, any state public utilities code, or any other Federal or
state statute or regulation limiting its ability to incur Indebtedness.
3.14. No Burdensome Restrictions. None of the Borrowers is a party to or
bound by any Contractual Obligation, or subject to any restriction in any
Organization Document, or any Requirement of Law, which could reasonably be
expected to have a Material Adverse Effect.
3.15. Subsidiaries. As of the Closing Date, the Borrowers have no
Subsidiaries other than those specifically disclosed in Schedule 1 hereto and
none of the Borrowers has equity investments in any other corporation or entity,
other than those specifically disclosed in Schedule 1.
3.16. Insurance. Except as specifically disclosed in Schedule 1, the
properties of each of the Borrowers are insured with financially sound and
reputable insurance companies not Affiliates of the Borrower, in such amounts,
with such deductibles and covering such risks as are customarily carried by
companies engaged in similar businesses and owning similar properties in
localities where the each of the Borrowers operates.
3.17. Solvency. The Borrowers, on a consolidated basis, are Solvent.
3.18. Borrowing Base Availability. The aggregate outstanding principal
amount of the Loans and L/C Obligations does not exceed the Borrowing Base.
3.19. Permits, Licenses, Etc. Each of the Borrowers possesses all permits,
licenses, franchises, trademarks, trade names, copyrights and patents necessary
to the conduct of its business as presently conducted or as presently proposed
to be conducted, except where the failure to possess the same would not have a
Material Adverse Effect.
3.20. Year 2000 Problem. The Borrowers have taken all action reasonably
necessary to assess the risk that the computer applications they use in their
businesses may be unable to properly perform date sensitive functions on or
after December 31, 1999. Further, they are in the process of taking all remedial
action reasonably necessary to avoid such risk and expect to timely complete
such action. To the knowledge of the Borrowers, no third party with which any
Borrower has any material contractual relationship has identified any similar
risk in its own computer applications which it is not addressing and which, if
not properly addressed, would be likely to have a Material Adverse Effect on the
business, financial condition or operations of the Borrowers.
3.21. Disclosure Generally. The representations and statements made by each
of the Borrowers or on its behalf in connection with this credit facility and
the Loans, including representations and statements in each of the Loan
Documents, do not and will not contain any untrue statement of a material fact
or omit to state a material fact or any fact necessary to make the
representations made not materially misleading. No written information, exhibit,
report, brochure or financial statement furnished by any of the Borrowers to the
Banks in connection with this credit facility, the Loans, or any Loan Document
contains or will contain any material misstatement of fact
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or omit to state a material fact or any fact necessary to make the statements
contained therein not misleading.
4. Conditions Precedent
4.1. All Loans. The obligation of each Bank to make any Loan or First
Union, as Agent, to issue any Standby Letter of Credit, is conditioned upon the
following:
(a) Request For Advance. Borrowers shall have delivered and First Union
shall have received a Request for Advance in such form as First Union may
request from time to time.
(b) Borrowing Base Certificate. Borrowers shall have delivered and the
Banks shall have received a Borrowing Base Certificate dated the date of the
Loan requested under this Agreement.
(c) Covenants; Representations. Each of the Borrowers shall be in
compliance with all covenants, agreements and conditions in each Loan Document
and each representation and warranty contained in each Loan Document shall be
true with the same effect as if such representation or warranty had been made on
the date such Loan or Standby Letter of Credit, as applicable, is made or
issued.
(d) Defaults. Immediately prior to and after giving effect to such
transaction, no Event of Default or Potential Default shall exist.
(e) Material Adverse Effect. Since September 30, 1997, there shall not have
been any Material Adverse Effect with respect to each of the Borrowers.
4.2. Conditions to First Loan. In addition to the conditions to all Loans
and Standby Letters of Credit as provided in ss. 4.1, the obligation of each
Bank to make its first Loan is conditioned upon the following:
(a) Articles, Bylaws. Each Bank shall have received copies of the Articles
or Certificate of Incorporation and Bylaws of each of the Borrowers certified by
its Secretary or Assistant Secretary; together with a Certificate of Good
Standing from the state of incorporation of such Borrower.
(b) Evidence of Authorization. Each Bank shall have received copies
certified by the Secretary or Assistant Secretary of each of the Borrowers or
any other appropriate official (in the case of a Person other than a Borrower)
of all corporate or other action taken by each Person other than the Banks who
is a party to any Loan Document to authorize its execution and delivery and
performance of the Loan Documents and to authorize the Loans, together with such
other related papers as First Union shall reasonably require.
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(c) Legal Opinions. Each Bank shall have received a favorable written
opinion from the Company's in-house counsel, in form and substance satisfactory
to the Banks, which shall be addressed to the Banks.
(d) Incumbency. First Union, as Agent, shall have received a certificate
signed by the secretary or assistant secretary of each Borrower, together with
the true signature of the officer or officers authorized to execute and deliver
the Loan Documents and certificates thereunder, upon which the Banks shall be
entitled to rely conclusively until it shall have received a further certificate
of the secretary or assistant secretary of each Borrower amending the prior
certificate and submitting the signature of the officer or officers named in the
new certificate as being authorized to execute and deliver Loan Documents and
certificates thereunder.
(e) Revolving Credit Notes. Each Bank shall have received its Revolving
Credit Note duly executed, completed and issued in accordance herewith.
(f) Documents. First Union, as Agent, shall have received all certificates,
instruments and other documents then required to be delivered pursuant to any
Loan Documents, in each instance in form and substance reasonably satisfactory
to it.
(g) Other Agreements. Each of the Borrowers shall have executed and
delivered each other Loan Document required hereunder.
(h) Fees, Expenses. Each of the Borrowers shall simultaneously pay or shall
have paid all fees and expenses, if any, due hereunder or any other Loan
Document.
5. Affirmative Covenants
Each of the Borrowers covenants and agrees that, without the prior written
consent of Required Banks, from and after the date hereof and so long as the
Loan Commitments are in effect or any Obligation remains unpaid or outstanding,
it will:
5.1. Financial Statements and Reports. Furnish to the Banks the following
financial information:
(a) Annual Statements. As soon as available, but not later than 90 days
after the end of each fiscal year (commencing with the fiscal year ended
September 30, 1998), a copy of the audited consolidated balance sheet of the
Company as at the end of such year and the related consolidated statements of
income or operations, shareholders' equity and cash flows for such year, setting
forth in each case in comparative form the figures for the previous fiscal year,
and accompanied by the opinion of KPMG Peat Marwick, L.L.P. or another
nationally-recognized independent public accounting firm ("Independent Auditor")
which report shall state that such consolidated financial statements present
fairly the financial position for the periods indicated in
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conformity with GAAP applied on a basis consistent with prior years. Such
opinion shall not be qualified or limited because of a restricted or limited
examination by the Independent Auditor of any material portion of the Borrower's
or any Subsidiary's records. The Company and its Subsidiaries also shall
provide, as soon as available, but not later than 90 days after the end of each
fiscal year (commencing with the fiscal year ended September 30, 1998), a copy
of an unaudited consolidating balance sheet of the Company and its Subsidiaries
as at the end of such year and the related consolidating statement of income,
and cash flows for such year, certified by a Responsible Officer as having been
developed and used in connection with the preparation of the financial
statements referred to in this subsection (a).
(b) Quarterly Statements. As soon as available, but not later than 60 days
after the end of each of the first three fiscal quarters of each fiscal year
(commencing with the fiscal quarter ended December 31, 1998), a copy of the
unaudited consolidated balance sheet of the Company as of the end of such
quarter and the related consolidated statements of income, shareholders equity
and cash flows for the period commencing on the first day and ending on the last
day of such quarter, and certified by a Responsible Officer as fairly
presenting, in accordance with GAAP (subject to ordinary, good faith year-end
audit adjustments), the financial position and the results of operations of the
Borrowers and the Subsidiaries;
5.2. Certificates; Other Information. Furnish to the Banks:
(a) Compliance Certificate. Concurrently with the delivery of the financial
statements referred to in subsections 5.1(a) and 5.1(b), a Compliance
Certificate executed by a Responsible Officer;
(b) Borrowing Base Certificate. As soon as available and in any event
within 30 days after the end of each month, a Borrowing Base Certificate and a
receivables-aging summary report as of the end of such month;
(c) ERISA. All reports and forms filed with respect to all Plans, except as
filed in the normal course of business and that would not result in an adverse
action to be taken under ERISA, and details of related information of a
Reportable Event, promptly following each filing;
(d) Material Changes. Notification to First Union, as Agent, and each other
Bank, of any litigation, administrative proceeding, investigation, business
development, or change in financial condition which would reasonably have a
Material Adverse Effect, promptly following its discovery;
(e) Subsidiaries. Notification to First Union, as Agent, and each other
Bank, of the formation or acquisition of any new Subsidiary together with the
nature and amount of assets and liabilities of such Subsidiary and the character
of business to be undertaken by such Subsidiary, promptly following its
formation or acquisition.
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(f) Other Information. Promptly, copies of all financial statements and
reports that the Company sends to its shareholders, and copies of all financial
statements and regular, periodical or special reports (including Forms 10K, 10Q
and 8K) that the each of the Borrowers or any Subsidiary may make to, or file
with, the SEC; such additional information regarding the business, financial or
corporate affairs of any of the Borrowers or any Subsidiary as First Union may
from time to time request.
5.3. Corporate Existence. Preserve its corporate existence and all material
franchises, licenses, patents, copyrights, trademarks, trade names contracts,
permits, approvals and other rights consistent with good business practice; and
maintain, keep, and preserve all of its properties (tangible and intangible)
necessary or useful in the conduct of its business in good working order and
condition, ordinary wear and tear excepted.
5.4. ERISA. Cause, and shall cause each of its ERISA Affiliates to: (a)
maintain each Plan in compliance in all material respects with the applicable
provisions of ERISA, the Code and other federal or state law; (b) cause each
Plan which is qualified under ss. 401(a) of the Code to maintain such
qualification; and (c) make all required contributions to any Plan subject to
ss. 412 of the Code.
5.5. Environmental Laws. Cause, and shall cause each Subsidiary to, conduct
its operations and keep and maintain its property in compliance with all
Environmental Laws, the noncompliance with which could have a Material Adverse
Effect.
5.6. Compliance with Regulations. Comply in all material respects with all
Regulations applicable to its business, the noncompliance with which reasonably
could have a Material Adverse Effect.
5.7. Compliance with Laws. Comply, and shall cause each Subsidiary to
comply, in all material respects with all Requirements of Law of any
Governmental Authority having jurisdiction over it or its business (including
the Federal Fair Labor Standards Act), except such as may be contested in good
faith or as to which a bona fide dispute may exist.
5.8. Maintenance of Properties. Maintain, and shall cause each Subsidiary
to maintain, and preserve all its property which is used or useful in its
business in good working order and condition, ordinary wear and tear excepted
and make all necessary repairs thereto and renewals and replacements thereof
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect.
5.9. Maintenance of Insurance. In addition to insurance requirements set
forth in the Collateral Documents (when applicable), each of the Borrowers shall
maintain, and shall cause each of its Subsidiaries to maintain, with financially
sound and reputable independent insurers, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business, of such types and in
such amounts as
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are customarily carried under similar circumstances by such other Persons;
including workers' compensation insurance, public liability and property and
casualty insurance.
5.10. Payment of Debt; Payment of Taxes, Etc. Cause, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) All tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by such Borrower or such Subsidiary;
(b) All lawful claims which, if unpaid, would by law become a Lien upon its
property; and
(c) All indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
5.11. Notice of Events. Promptly notify the Banks:
(a) of the occurrence of any Event of Default or Potential Default under
this Agreement or any other Loan Document;
(b) of (i) any breach or non-performance of, or any default under, any
Contractual Obligation of any Borrower or any Subsidiary which could result in a
Material Adverse Effect; and (ii) any dispute, litigation, investigation,
proceeding or suspension which may exist at any time between any Borrower or any
Subsidiary and any Governmental Authority which could result in a Material
Adverse Effect;
(c) of the commencement of, or any material development in, any litigation
or proceeding affecting any Borrower or any Subsidiary which, if adversely
determined, would reasonably be expected to have a Material Adverse Effect, or
(iii) in which the relief sought is an injunction or other stay of the
performance of this Agreement or any Loan Document;
(d) of any other litigation or proceeding affecting any Borrower or any
Subsidiary which such Borrower would be required to report to the SEC pursuant
to the Exchange Act, within four days after reporting the same to the SEC;
(e) of the occurrence of any of the following events affecting any Borrower
or any ERISA Affiliate which could result in a Material Adverse Effect, and
deliver to First Union a copy of any notice with respect to such event is filed
with a Governmental Authority and any notice delivered by a Governmental
Authority to any Borrower or any ERISA Affiliate with respect to such event:
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(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any
Plan;
(iii) the adoption of, or the commencement of contributions to, any
Plan subject to ss. 412 of the Code by the Borrowers or any ERISA
Affiliate;
(iv) the adoption of any amendment to a Plan subject to ss. 412 of the
Code, if such amendment results in a material increase in contributions or
Unfunded Pension Liability;
(f) of any material change in accounting policies or financial reporting
practices by any Borrower or any consolidated Subsidiary;
Each notice under this Section shall be accompanied by a written statement
by a Responsible Officer setting forth details of the occurrence referred to
therein, and stating what action the Borrowers or any affected Subsidiary
proposes to take with respect thereto and at what time. Each notice under this
subsection 5.10(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been (or
foreseeably will be) breached or violated.
5.12. Inspection Rights. Maintain and shall cause each Subsidiary to
maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all
financial transactions and matters involving the assets and business of the
Borrowers and such Subsidiary. With respect to each unit of Eligible Equipment
owned by it, Borrowers shall maintain records on a continuous basis, which shall
be in such form and show such information with respect to each individual unit
of Eligible Equipment as is necessary for the determination of the Net Book
Value of the Eligible Equipment and the security value of the Vehicle. The
Borrowers shall permit, and shall cause each Subsidiary to permit,
representatives and independent contractors of the Banks to visit and inspect
any of their respective properties, to examine their respective corporate,
financial and operating records, and make copies thereof or abstracts therefrom,
and to discuss their respective affairs, finances and accounts with their
respective officers, all at such reasonable times during normal business hours
and as often as may be reasonably desired, upon reasonable advance notice to the
Borrower; provided, however, when an Event of Default exists the Banks may do
any of the foregoing at the expense of the Borrower at any time during normal
business hours and without advance notice.
5.13. Compliance with Material Contracts. Comply in all material respects
with all obligations, terms, conditions and covenants, as applicable, in all
Indebtedness applicable to it and all instruments and agreements related
thereto, and all other instruments and agreements to which it is a party or by
which it is bound or any of its properties is affected and in respect of which
the failure to comply reasonably would have a Material Adverse Effect.
5.14. Use of Proceeds. Use the proceeds of each Loan made pursuant hereto
for the purchase or refinance of Equipment as provided herein or general working
capital purposes.
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5.15. Significant Subsidiaries. If at any time any Subsidiary of any of the
Borrowers represents ten percent (10%) or more of total Accounts, Equipment or
Tangible Net Worth on a consolidated basis, the Borrowers shall cause such
Subsidiary to become a Borrower and party to this Agreement and the Collateral
Documents.
5.16. Year 2000 Program. The Borrowers will use their best efforts to
continue to monitor the potential impact of the Year 2000 Problem and if any
problem is determined to exist to develop and implement a comprehensive detailed
program to address on a timely basis such problem.
5.17. Further Assurances.
(a) Ensure that all written information, exhibits and reports furnished to
the Banks do not and will not contain any untrue statement of a material fact
and do not and will not omit to state any material fact or any fact necessary to
make the statements contained therein not misleading in light of the
circumstances in which made, and will promptly disclose to the Banks and correct
any defect or error that may be discovered therein or in any Loan Document or in
the execution, acknowledgment or recordation thereof.
(b) Promptly upon request by First Union or the Banks, the Borrowers shall
(and shall cause any Subsidiary) to do, execute, acknowledge, deliver, record,
re-record, file, re-file, resister and re-register, any and all such further
acts, deeds, conveyances, security agreements, mortgages, assignments, estoppel
certificates, financing statements and continuations thereof, termination
statements, notices of assignment, transfers, certificates, assurances and other
instruments the Banks may reasonably require from time to time in order (i) to
carry out more effectively the purposes of this Agreement or any other Loan
Document, (ii) to subject to the Liens created by any of the Collateral
Documents any of the properties, rights or interests covered by any of the
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Collateral Documents and the Liens intended to be
created thereby, (iv) cause the title to all Eligible Equipment purchased on or
after the date of this Agreement to be and continue to be in the name of the
Company; (v) at any time a Security Agreement is executed hereunder, continue to
be the lawful owner of the Assigned Vehicle and Accounts free and clear of all
Liens, except as otherwise permitted hereunder and (vi) to better assure,
convey, grant, assign, transfer, preserve, protect and confirm to the Banks the
rights granted or now or hereafter intended to be granted to the Banks under any
Loan Document or under any other document executed in connection therewith.
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6. Negative Covenants
Each of the Borrowers covenants and agrees that, without the prior written
consent of the Required Banks, from and after the date hereof and so long as the
Loan Commitments are in effect or any Obligation remains unpaid or outstanding,
it will not:
6.1. Consolidation and Merger. Subject to the provisions of ss. 6.4, no
Borrower will suffer or permit any Subsidiary to, merge, consolidate with or
into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to or in favor of any Person,
except:
(a) any Subsidiary may merge with any Borrower, provided that such Borrower
shall be the continuing or surviving corporation, or with any one or more
Subsidiaries, provided that if any transaction shall be between a Subsidiary and
a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be the continuing
or surviving corporation; and
(b) any Subsidiary may sell all or substantially all of its assets (upon
voluntary liquidation or otherwise), to a Borrower or another Wholly-Owned
Subsidiary, provided such Subsidiary shall either be or shall become a Borrower
hereunder.
6.2. Liens. No Borrower will, or permit any Subsidiary to, create, assume
or permit to exist any Lien on any of its property or assets, whether now owned
or hereafter acquired, or upon any income or profits therefrom, except Permitted
Liens.
6.3. Guarantees, Loans or Advances. Except as otherwise provided in ss. 6.2
and 6.4, no Borrower will suffer, or permit any Subsidiary to, become or be a
guarantor or surety of, or otherwise become or be responsible in any manner
(whether by agreement to purchase any obligations, stock, assets, goods or
services, or to supply or advance any funds, assets, goods or services or
otherwise) with respect to, any undertaking of any other person or entity, or
make or permit to exist any loans or advances to any other Person or entity,
except for those guarantees, loans or advances made in the ordinary course of
business which in the aggregate shall not exceed $2,500,000 outstanding at any
time.
6.4. Acquisitions and Investments. Purchase or acquire, or suffer or permit
any Subsidiary to purchase or acquire, or make any commitment therefor, any
capital stock, equity interest, or any obligations or other securities of, or
any interest in, any Person, or make or commit to make any acquisitions, or make
or commit to make any advance, loan, extension of credit or capital contribution
to or any other investment in, any Person including any Affiliate of the
Borrowers(together, "Investments"), except that so long as no Event of Default
or Potential Default has occurred or would occur as result thereof:
(a) Investments held by any Borrower or Subsidiary in the form of cash
equivalents;
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(b) Investments by any Subsidiary, provided, however, that the aggregate
total of all Investments by any all Subsidiaries taken together shall not exceed
$2,500,000;
(c) advances, loans or extensions of credit to non-Borrower or restricted
Subsidiaries of the Borrowers not in excess of $1,000,000 in the aggregate at
any time outstanding;
(d) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the ordinary
course of business; and
(e) Acquisitions, provided, however, that the aggregate total of all
Acquisitions shall not exceed $25,000,000 during the term of this Agreement.
6.5. Restricted Payments. Declare or make, and shall not suffer or permit
any Subsidiary to declare or make, any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock, or purchase, redeem or otherwise
acquire for value any shares of its capital stock or any warrants, rights or
options to acquire such shares, now or hereafter outstanding; except that so
long as no Event of Default or Potential Default has occurred, each Borrower
may:
(a) Declare and make dividend payments or other distributions payable
solely in its common stock;
(b) Purchase, redeem or otherwise acquire shares of its common stock or
warrants or options to acquire any such shares with the proceeds received from
the substantially concurrent issue of new shares of its common stock; and
(c) Make equity distributions to Xxxxxxx Systems, Inc. not in excess of 25%
of Consolidated Net Income subsequent to January 1, 1998.
6.6. Margin Stock. Use or permit any proceeds of the Loans to be used,
either directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of buying or carrying margin stock within the meaning of Regulation U
of The Board of Governors of the Federal Reserve System, as amended from time to
time.
6.7. Change in Business. Engage, and shall not suffer or permit any
Subsidiary to engage, in any material line of business substantially different
from those lines of business carried on by the Borrowers and any Subsidiary on
the date hereof.
6.8. Accounting Change. Without the prior written approval of the Required
Banks, make or permit any material change in financial accounting policies
(including but not limited to depreciation policies in effect at December 31,
1997) or financial reporting practices, except as required by Generally Accepted
Accounting Principles or regulations of the Securities and Exchange Commission,
if applicable.
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6.9. Transactions with Affiliates. Enter into, and shall not suffer or
permit any Subsidiary to enter into, any transaction with any Affiliate of any
Borrower, except upon fair and reasonable terms no less favorable to such
Borrower or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of such Borrower or such Subsidiary.
6.10. Restriction on Amendment of this Agreement. Enter into or otherwise
become subject to or suffer to exist any agreement which would require it to
obtain the consent of any other person as a condition to the ability of the
Banks and the Borrowers to amend or otherwise modify this Agreement.
6.11. Negative, Negative Pledge Agreements. Create, incur, assume or become
subject to any obligation to any third party which would prohibit or restrict
the ability of the Borrowers to grant any Lien in favor of the Banks pursuant to
this Agreement.
7. Financial Covenants
Each of the Borrowers covenants and agrees that, without the prior written
consent of the Required Banks, from and after the date hereof and so long as the
Loan Commitments are in effect or any Obligation remains unpaid or outstanding,
that:
7.1. Minimum Tangible Net Worth. Tangible Net Worth of the Company, on a
consolidated basis, will be equal to or greater than the sum of (i) $50,000,000
and (ii) 50% of Consolidated Net Income for each Fiscal Quarter ending after
December 31, 1997, without deduction for any net losses.
7.2. Fixed Charge Coverage Ratio. The Company, on a consolidated basis,
shall not incur a Fixed Charge Coverage Ratio of less than 1.15 to 1.0.
7.3. Leverage Ratio. The Company, on a consolidated basis, shall not incur
a Leverage Ratio of greater than 2.5 to 1.0.
7.4. Borrowing Base. The aggregate principal amount of Loans and L/C
Obligations outstanding shall not at any time exceed the Borrowing Base or the
Aggregate Loan Commitment, whichever is less; provided, however, that this
covenant shall not be deemed breached if, at the time such aggregate amount
exceeds said level, within four Business Days after the earlier of the date any
Borrwer first has knowledge of such excess or the date of the next Borrowing
Base Certificate disclosing the existence of such excess, a prepayment of Loans
shall be made in an amount sufficient to assure continued compliance with this
covenant in the future.
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8. Default
8.1. Events of Default. Each of the Borrowers shall be in default if any
one or more of the following events (each an "Event of Default") occurs:
(a) Payments. Borrowers fail to pay the principal due on any Note when due
and payable (whether at maturity, by notice of intention to prepay, or
otherwise); or Borrowers fail to pay interest or any other amount payable
hereunder or under any other Loan Document within five Business Days after the
date such interest or other amount is due and payable.
(b) Covenants. Borrowers fail to observe or perform (1) any term, condition
or covenant set forth in xx.xx. 5.1, 5.2(a), 5.2(b) or 5.2(d), ss. 5.3 (with
respect to corporate existence only), all sections of Articles 6, 7 and 9, or
ss. 8.1(a) of this Agreement, as and when required, or (2) any term, condition
or covenant contained in this Agreement or any other Loan Document other than as
set forth in (1) above, as and when required and such failure shall continue for
a period of 20 Business Days or more.
(c) Representations, Warranties. Any representation or warranty made or
deemed to be made by any Borrower, as applicable, herein or in any Loan Document
or in any exhibit, schedule, report or certificate delivered pursuant hereto or
thereto shall prove to have been false, misleading or incorrect in any material
respect when made or deemed to have been made.
(d) Bankruptcy. Any Borrower is dissolved or liquidated, makes an
assignment for the benefit of creditors, files a petition in bankruptcy, is
adjudicated insolvent or bankrupt, petitions or applies to any tribunal for any
receiver or trustee, commences any proceeding relating to itself under any
bankruptcy, reorganization, readjustment of debt, dissolution or liquidation law
or statute of any jurisdiction, has commenced against it any such proceeding
which remains undismissed for a period of sixty (60) days, or indicates its
consent to, approval of or acquiescence in any such proceeding, or any receiver
of or trustee for such Borrower or any substantial part of the property of such
Borrower is appointed, or if any such receivership or trusteeship continues
undischarged for a period of sixty (60) days.
(e) ERISA. (i) An ERISA Event shall occur with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of any Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of 10% of
Consolidated Net Worth at the time of the ERISA Event; or (ii) the aggregate
amount of Unfunded Pension Liability among all Plans at any time exceeds 10% of
Consolidated Net Worth; or (iii) any Borrower or any ERISA Affiliate shall fail
to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under ss. 4201 of
ERISA under a Multiemployer Plan in an aggregate amount in excess of 10% of
Consolidated Net Worth at the time calculated.
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(f) Certain Other Defaults. Any Borrower shall fail to pay when due any
Indebtedness which singularly or in the aggregate exceeds 10% of Consolidated
Net Worth at the time calculated, and such failure shall continue beyond any
applicable cure period, or any Borrower shall suffer to exist any default or
event of default in the performance or observance, subject to any applicable
grace period, of any agreement, term, condition or covenant with respect to any
agreement or document relating to Indebtedness if the effect of such default is
to permit, with the giving of notice or passage of time or both, the holders
thereof, or any trustee or agent for said holders, to terminate or suspend any
commitment (which is equal to or in excess of 10% of Consolidated Net Worth at
the time calculated) to lend money or to cause or declare any portion of any
borrowings thereunder to become due and payable prior to the date on which it
would otherwise be due and payable, provided that during any applicable cure
period the Bank's obligations hereunder to make further Loans shall be
suspended.
(g) Judgments. Any judgments against any Borrower or against its assets or
property (i) for amounts in excess of 10% of Consolidated Net Worth at the time
calculated in the aggregate remain unpaid, unstayed on appeal, undischarged,
unbonded and undismissed for a period of ten (10) days and (ii) to the extent
such judgments are not covered by independent third-party insurance as to which
the insurer does not dispute coverage.
(h) Change in Control. There occurs any Change of Control.
(i) Material Adverse Effect. There occurs a Material Adverse Effect.
THEN and in every such event other than that specified in ss. 8.1(d), First
Union, as Agent, may, or at the written request of the Required Banks shall
immediately terminate the Aggregate Loan Commitment by notice in writing to
Borrowers and immediately declare the Notes, including without limitation
accrued interest, to be, and they shall thereupon forthwith become due and
payable without presentment, demand, or notice of any kind, all of which are
hereby expressly waived by Borrowers. Upon the occurrence of any event specified
in ?0, the Aggregate Loan Commitment shall automatically terminate and the
Notes, including without limitation accrued interest, shall immediately be due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by Borrowers. Any date on which the
Notes and such other Obligations are declared due and payable pursuant to this
ss. 8.1, shall be the Revolver Termination Date for purposes of this Agreement.
From and after the date an Event of Default shall have occurred and for so long
as an Event of Default shall be continuing, the Loans shall bear interest at the
Default Rate.
9. Collateral
9.1. Collateral & Security Agreement. Upon the request of the Required
Banks, as security for the punctual payment in full of all Notes (including all
payments of principal, and interest and other costs contemplated hereby),
Borrowers shall execute and deliver to First Union,
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as Agent, the Security Agreement and such other documents as may be necessary to
constitute and evidence a perfected first priority security interest in the
Collateral (as defined in the Security Agreement, hereinafter referred to as the
"Collateral").
9.2. Conditions Subsequent. Upon the request of the Required Banks pursuant
to ss. 9.1 of this Agreement, the Borrowers shall deliver to First Union, as
Agent, immediately following such request:
(a) a Security Agreement, executed by the Borrower, in appropriate form for
recording, where necessary, together with acknowledgment copies of all UCC-1
financing statements filed, registered or recorded to perfect the security
interests of First Union, as Agent for the Banks, or other evidence satisfactory
to First Union, as Agent, that there has been filed, registered or recorded all
financing statements and other filings, registrations and recordings necessary
and advisable to perfect the Liens of First Union, as Agent for the benefit of
the Banks, in accordance with applicable law; provided, however, that Borrowers
shall deliver, within 30 days after receipt of the request of the Required
Banks, certificates of title with encumbrances properly noted thereon to perfect
First Union's lien for the benefit of the Banks;
(b) written advice relating to such Lien and judgment searches as the Banks
shall have requested, and such termination statements or other documents as may
be necessary to confirm that the Collateral is subject to no other Liens in
favor of any Persons (other than Permitted Liens);
(c) evidence that all other actions necessary or, in the opinion of First
Union, as Agent, desirable to perfect and protect the first priority Lien
created by the Loan Documents, and to enhance First Union's ability to preserve
and protect its interests in and access to the Collateral, have been taken.
10. Agent
10.1. Appointment and Authorization. Each Bank hereby irrevocably appoints
and authorizes First Union, as Agent, to take such action on its behalf and to
exercise such powers under this Agreement and the Loan Documents as are
specifically delegated to it as Agent by the terms hereof or thereof, together
with such other powers as are reasonably incidental thereto. The relationship
between First Union and each Bank has no fiduciary aspects, and First Union'
duties as Agent hereunder are acknowledged to be only ministerial and not
involving the exercise of discretion on its part. Nothing in this Agreement or
any Loan Document shall be construed to impose on First Union any duties or
responsibilities other than those for which express provision is made herein or
therein. In performing its duties and functions under this Article 10, First
Union does not assume and shall not be deemed to have assumed, and hereby
expressly disclaims, any obligation with or for Borrowers. As to matters not
expressly provided for in this Agreement or any Loan Document, First
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Union shall not be required to exercise any discretion or to take any action or
communicate any notice, but shall be fully protected in so acting or refraining
from acting upon the instructions of the Required Banks and their respective
successors and assigns; provided, however, that in no event shall First Union be
required to take any action which exposes it to personal liability or which is
contrary to this Agreement, any Loan Document or applicable law, and First Union
shall be fully justified in failing or refusing to take any action hereunder
unless it shall first be specifically indemnified to its satisfaction by the
Banks against any and all liability and expense which may be incurred by it by
reason of taking or omitting to take any such action. If an indemnity furnished
to First Union for any purpose shall, in its reasonable opinion, be insufficient
or become impaired, First Union may call for additional indemnity from the Banks
and not commence or cease to do the acts for which such indemnity is requested
until such additional indemnity is furnished.
10.2. Duties and Obligations. In performing its functions and duties
hereunder on behalf of the Banks, First Union shall exercise the same care and
skill as it would exercise in dealing with loans for its own account. Neither
First Union nor any of its directors, officers, employees or other agents shall
be liable for any action taken or omitted to be taken by it or them under or in
connection with this Agreement or any Loan Document except for its or their own
gross negligence or willful misconduct. Without limiting the generality of the
foregoing, First Union (a) may consult with legal counsel and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith and in accordance with the advice of such experts; (b)
makes no representation or warranty to any Bank as to, and shall not be
responsible to any Bank for, any recital, statement, representation or warranty
made in or in connection with this Agreement, any Loan Document or in any
written or oral statement (including a financial or other such statement),
instrument or other document delivered in connection herewith or therewith or
furnished to any Bank by or on behalf of any Borrower; (c) shall have no duty to
ascertain or inquire into Borrowers' performance or observance of any of the
covenants or conditions contained herein or to inspect any of the property
(including the books and records) of any Borrower or inquire into the use of the
proceeds of the Loans or (unless the officers of First Union active in their
capacity as officers of First Union on any Borrower's account have actual
knowledge thereof or have been notified in writing thereof) to inquire into the
existence or possible existence of any Event of Default or Potential Default;
(d) shall not be responsible to any Bank for the due execution, legality,
validity, enforceability, effectiveness, genuineness, sufficiency,
collectability or value of this Agreement or any other Loan Document or any
instrument or document executed or issued pursuant hereto or in connection
herewith, except to the extent that such may be dependent on the due
authorization and execution by First Union itself; (e) except as expressly
provided herein in respect of information and data furnished to First Union for
distribution to the Banks, shall have no duty or responsibility, either
initially or on a continuing basis, to provide to any Bank any credit or other
information with respect to Borrower, whether coming into its possession before
the making of the Loans or at any time or times thereafter; and (f) shall incur
no liability under or in respect of this Agreement or any other Loan Document
for, and shall be entitled to rely and act upon, any notice, consent,
certificate or other instrument or writing (which may be by facsimile
(telecopier), telegram, cable, or other electronic means) believed by it to be
genuine and correct and to have been signed or sent by the proper party or
parties.
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10.3. First Union as a Bank. With respect to its Loan Commitment and the
Loans made and to be made by it, First Union shall have the same rights and
powers under this Agreement and all other Loan Documents as the other Banks and
may exercise the same as if it were not the Agent. The terms "Bank" and "Banks"
as used herein shall, unless otherwise expressly indicated, include First Union
in its individual capacity. First Union and any successor Agent which is a
commercial bank, and their respective affiliates, may accept deposits from, lend
money to, act as trustee under indentures of and generally engage in any kind of
business with, any Borrower and its affiliates from time to time, all as if such
entity were not the Agent hereunder and without any duty to account therefor to
any Bank.
10.4. Independent Credit Decisions. Each Bank acknowledges to First Union
that it has, independently and without reliance upon First Union or any other
Bank, and based upon such documents and information as it has deemed
appropriate, made its own independent credit analysis and decision to enter into
this Agreement. Each Bank also acknowledges that it will, independently or
through other advisers and representatives but without reliance upon First Union
or any other Bank, and based upon such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or refraining from taking any action under this Agreement or any Loan
Document.
10.5. Indemnification. The Banks agree to indemnify First Union (to the
extent not previously reimbursed by Borrowers), ratably in proportion to each
Bank's Commitment Percentage, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against First Union in its capacity as Agent in any
way relating to or arising out of this Agreement or any Loan Document or any
action taken or omitted to be taken by First Union in its capacity as Agent
hereunder or under any Loan Document; provided that none of the Banks shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from First Union' gross negligence or willful misconduct. Without limiting the
generality of the foregoing, each Bank agrees to reimburse First Union, promptly
on demand, for such Bank's ratable share (based upon the aforesaid
apportionment) of any out-of-pocket expenses (including counsel fees and
disbursements) incurred by First Union in connection with the preparation,
execution, administration or enforcement of, or the preservation of any rights
under, this Agreement and the Loan Documents to the extent that First Union is
not reimbursed for such expenses by Borrowers.
10.6. Successor Agent. First Union may resign at any time by giving written
notice of such resignation to the Banks and Borrowers, such resignation to be
effective only upon the appointment of a successor Agent as hereinafter
provided. Upon any such notice of resignation, the Banks shall jointly appoint a
successor Agent upon written notice to Borrowers and First Union. If no
successor Agent shall have been jointly appointed by such Banks and shall have
accepted such appointment within thirty (30) days after First Union shall have
given notice of resignation, First Union may, upon notice to Borrowers and the
Banks, appoint a successor Agent. Upon its acceptance of any appointment as
Agent hereunder, the successor Agent shall succeed to and become vested with all
the rights, powers, privileges and duties of First Union, and First Union shall
be discharged from its
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duties and obligations as Agent under this Agreement and the Loan Documents.
After First Union' resignation hereunder, the provisions hereof shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
the Agent under this Agreement and the Loan Documents.
10.7. Allocations Made By First Union. As between First Union, as Agent,
and the Banks, unless a Bank objecting to a determination or allocation made by
First Union pursuant to this Agreement delivers to First Union written notice of
such objection within one hundred twenty (120) days after the date any
distribution was made by First Union, such determination or allocation shall be
conclusive on such one hundred twentieth day and only those items expressly
objected to in such notice shall be deemed disputed by such Bank. First Union
shall not have any duty to inquire as to the application by the Banks of any
amounts distributed to them.
11. Miscellaneous
11.1 Modifications and Waivers. No amendment, modification, termination or
waiver of any provision of this Agreement, including, without limitation, the
amendment, modification or waiver of any covenant or default located herein, any
Revolving Credit Note, any Term Note or any other Loan Document and no consent
to any departure by Borrowers therefrom shall in any event be effective, unless
the same shall be in writing, and approved by the Required Banks except as
provided below, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given; provided, however, that
without the written consent of all of the Banks, no such modification, waiver or
consent shall (a) change the amount or maturity date of the principal of, or
change the rate or extend the time of payment of interest on, any Revolving
Credit Note or Term Note, (b) change the amount of or extend the time of payment
of any fee due under any Loan Document, (c) change any of the amounts and
percentages of the Loan Commitments, (d) change or affect the provisions of ss.
8.1(a), (e) subordinate any Revolving Credit Note or Term Note in right of
payment to any other indebtedness or obligation whatsoever, (f) change or
otherwise modify the definition of "Borrowing Base" or "Required Banks", (g)
change or affect any provision of this ss. 11.1, (h) release any Borrower from
its obligations to repay the Loans and all related fees and expenses, or (i)
release any Collateral once obtained except as expressly provided herein or in
any other Loan Document. No notice to or demand on the Borrowers shall entitle
Borrowers to any other or further notice or demand in similar or other
circumstances.
11.2. Waiver. No failure or delay on the part of First Union or any Bank or
any holder of any Note in exercising any right, power or remedy under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy under any
Loan Document. The remedies provided under the Loan Documents are cumulative and
not exclusive of any remedies provided by law.
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11.3. Governing Law. The Loan Documents and all rights and obligations of
the parties thereunder shall be governed by and be construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania without regard to
Pennsylvania or federal principles of conflict of laws.
11.4. Participations and Assignments. Each Borrower hereby acknowledges and
agrees that any Bank may at any time, with the consent of the Company and First
Union, as Agent (which consents shall not be unreasonably withheld): (a) grant
participations in all or any portion of its Loan Commitment or any portion of
its Note or of its right, title and interest therein or in or to this Agreement
(collectively, "Participations") to any other lending office of such Bank or to
any other bank, lending institution or other entity which has the requisite
sophistication to evaluate the merits and risks of investments in Participations
("Participants"); provided, however, that: (i) all amounts payable by Borrowers
hereunder shall be determined as if such Bank had not granted such
Participation; (ii) such Bank shall act as agent for all Participants; and (iii)
any agreement pursuant to which such Bank may grant a Participation: (x) shall
provide that such Bank shall retain the sole right and responsibility to enforce
the obligations of Borrowers hereunder including, without limitation, the right
to approve any amendment, modification or waiver of any provisions of this
Agreement; (y) such participation agreement may provide that such Bank will not
agree to any modification, amendment or waiver of this Agreement without the
consent of the Participant if such modification, amendment or waiver would
reduce the principal of or rate of interest on any Loan or postpone the date
fixed for any payment of principal of or interest on any Loan; and (z) shall not
relieve such Bank from its obligations, which shall remain absolute, to make
Loans hereunder; and (b) assign any of its Loans and its Loan Commitment,
provided that each such assignment shall be in an amount of at least $5,000,000
(unless, after giving effect to such assignment and all other such assignments
by such assigning Bank occurring simultaneously or substantially simultaneously
therewith, such assigning Bank shall hold no Revolving Credit Commitment or any
portion of its Note hereunder). Upon execution and delivery by the assignee to
Borrowers of an instrument in writing pursuant to which such assignee agrees to
become a "Bank" hereunder having the Loan Commitment and Loans specified in such
instrument, and upon consent thereto by Borrower, to the extent required above,
the assignee shall have, to the extent of such assignment (unless otherwise
provided in such assignment with the consent of the Borrower), the obligations,
rights and benefits of a Bank hereunder holding the Loan Commitment and Loans
(or portions thereof) assigned to it, and such Bank shall, to the extent of such
assignment, be released from the Commitment (or portion(s) thereof) so assigned.
In each such instance, the assignee Bank shall be entitled to receive
substituted Notes in its name. Upon receipt of the substituted Notes, the
assignee Bank shall xxxx the assigned Notes "canceled" and return them to the
Company. Upon each such assignment, the assignee shall pay to First Union, as
Agent, an assignment fee of $3,500.
11.5. Captions. Captions in the Loan Documents are included for convenience
of reference only and shall not constitute a part of any Loan Document for any
other purpose.
11.6. Notices. All notices, requests, demands, directions, declarations and
other communications between the Banks and the Borrowers provided for in any
Loan Document shall, except as otherwise expressly provided, be mailed by
registered or certified mail, return receipt
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requested, or telegraphed, or faxed, or delivered in hand to the applicable
party at its address indicated opposite its name on the signature pages hereto.
The foregoing shall be effective and deemed received three days after being
deposited in the mails, postage prepaid, addressed as aforesaid and shall
whenever sent by telegram, telegraph or fax or delivered in hand be effective
when received. Any party may change its address by a communication in accordance
herewith.
11.7. Sharing of Collections, Proceeds and Set-Offs: Application of
Payments.
(a) If any Bank, by exercising any right of set-off, counterclaim or
foreclosure against trade collateral or otherwise, receives payment of principal
or interest or other amount due on any Note which is greater than the percentage
share of such Bank (determined as set forth below), the Bank receiving such
proportionately greater payment shall purchase such participations in the Loans
held by the other Banks, and such other adjustments shall be made as may be
required, so that all such payments shall be shared by the Banks on the basis of
their percentage shares; provided that if all or any portion of such
proportionately greater payment of such indebtedness is thereafter recovered
from, or must otherwise be restored by, such purchasing Bank, the purchase shall
be rescinded and the purchase price restored to the extent of such recovery, but
without interest being paid by such purchasing Bank. The percentage share of
each Bank shall be based on the portion of the outstanding Loans of such Bank
(prior to receiving any payment for which an adjustment must be made under this
ss. in relation to the aggregate outstanding Loans of all the Banks. Borrowers
agree, to the fullest extent it may effectively do so under applicable law, that
any holder of a participation in a Loan or reimbursement obligation, whether or
not acquired pursuant to the foregoing arrangements, may exercise rights of
set-off or counterclaim and other rights with respect to such participation as
fully as if such holder of a participation were a direct creditor of any
Borrower in the amount of such participation. If under any applicable
bankruptcy, insolvency or other similar law, any Bank receives a secured claim
in lieu of a set-off to which this Section would apply, such Bank shall, to the
extent practicable, exercise its rights in respect of such secured claim in a
manner consistent with the rights of the Banks entitled under this Section to
share in the benefits of any recovery on such secured claim.
(b) If an Event of Default or Potential Default shall have occurred and be
continuing First Union, as Agent, and each Bank and each Borrower agree that all
payments on account of the Loans shall be applied by First Union, as Agent, and
the Banks as follows:
First, to First Union, as Agent, for any Agent fees then due and payable
under this Agreement until such fees are paid in full;
Second, to First Union, as Agent, for any fees, costs or expenses
(including expenses described in ss. 11.8) incurred by First Union, as
Agent, under any of the Loan Documents or this Agreement, then due and
payable and not reimbursed by Borrowers or the Banks until such fees, costs
and expenses are paid in full;
Third, to the Banks for their percentage shares of the Commitment Fee then
due and payable under this Agreement until such fee is paid in full;
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Fourth, to the Banks for their respective shares of all costs, expenses and
fees then due and payable from Borrowers until such costs, expenses and
fees are paid in full;
Fifth, to the Banks for their percentage shares of all interest then due
and payable from Borrowers until such interest is paid in full, which
percentage shares shall be calculated by determining each Bank's percentage
share of the amounts allocated in (a) above determined as set forth in said
clause (a); and
Sixth, to the Banks for their percentage shares of the principal amount of
the Loans then due and payable from Borrowers until such principal is paid
in full, which percentage shares shall be calculated by determining each
Bank's percentage share of the amounts allocated in (a) above determined as
set forth in said clause (a).
11.8. Expenses; Indemnification. Borrowers will from time to time reimburse
First Union, as Agent, promptly following demand for all reasonable
out-of-pocket expenses (including the reasonable fees and expenses of its legal
counsel) in connection with (i) the preparation of the Loan Documents, (ii) the
making of any Loans, and (iii) the administration of the Loan Documents.
Borrowers also will from to time reimburse First Union, as Agent, and each Bank
for all out-of-pocket expenses (including reasonable fees and expenses of legal
counsel) in connection with the enforcement of the Loan Documents. In addition
to the payment of the foregoing expenses, each Borrower hereby agrees to
indemnify, protect and hold First Union, as Agent, each Bank and any holder of
any Note and the officers, directors, employees, agents, affiliates and
attorneys of First Union, as Agent, each Bank and such holder (collectively, the
"Indemnitees") harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature, including reasonable fees and expenses of
legal counsel, which may be imposed on, incurred by, or asserted against such
Indemnitee by any Borrower or other third parties and arise out of or relate to
this Agreement or the other Loan Documents or any other matter whatsoever
related to the transactions contemplated by or referred to in this Agreement or
the other Loan Documents; provided, however, that Borrowers shall have no
obligation to an Indemnitee hereunder to the extent that the liability incurred
by such Indemnitee has been determined by a court of competent jurisdiction to
be the result of gross negligence or willful misconduct of such Indemnitee.
11.9. Survival of Warranties and Certain Agreements. All agreements,
representations and warranties expressly made herein shall survive the execution
and delivery of this Agreement, the making of the Loans hereunder and the
execution and delivery of the Note. Notwithstanding anything in this Agreement
or implied by law to the contrary, the agreements of Borrowers set forth in ss.
11.8 shall survive the payment of the Loans and the termination of this
Agreement. This Agreement shall remain in full force and effect until the
repayment in full of all amounts owed by Borrowers under the Notes or any other
Loan Document and the termination of the Loan Commitment of each Bank.
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11.10. Severability. The invalidity, illegality or unenforceability in any
jurisdiction of any provision in or obligation under this Agreement, the Notes
or other Loan Documents shall not affect or impair the validity, legality or
enforceability of the remaining provisions or obligations under this Agreement,
the Notes or other Loan Documents or of such provision or obligation in any
other jurisdiction.
11.11. Banks' Obligations Several; Independent Nature of Banks' Rights. The
obligation of each Bank hereunder is several and not joint and no Bank shall be
the agent of any other (except to the extent the Agent is authorized to act as
such hereunder). No Bank shall be responsible for the obligation or commitment
of any other Bank hereunder. In the event that any Bank at any time should fail
to make a Loan as herein provided, the other Banks, or any of them as may then
be agreed upon, at their sole option, may make the Loan that was to have been
made by the Bank so failing to make such Loan. Nothing contained in any Loan
Document and no action taken by Agent or any Bank pursuant hereto or thereto
shall be deemed to constitute the Banks to be a partnership, an association, a
joint venture or any other kind of entity. The amounts payable at any time
hereunder to each Bank shall be a separate and independent debt, and, subject to
the terms of this Agreement, each Bank shall be entitled to protect and enforce
its rights arising out of this Agreement and it shall not be necessary for any
other Bank to be joined as an additional party in any proceeding for such
purpose.
11.12. No Fiduciary Relationship. No provision in this Agreement or in any
of the other Loan Documents and no course of dealing between the parties shall
be deemed to create any fiduciary duty by any Bank to any Borrower.
11.13. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. BORROWERS, FIRST
UNION AS AGENT AND THE BANKS, EACH HEREBY CONSENTS TO THE JURISDICTION OF ANY
STATE OR FEDERAL COURT LOCATED WITHIN THE EASTERN DISTRICT OF PENNSYLVANIA AND
IRREVOCABLY AGREES THAT, ANY ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING
TO THE NOTES, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS MAY BE LITIGATED IN
SUCH COURTS. EACH PARTY TO THIS AGREEMENT ACCEPTS FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH THIS AGREEMENT, ANY NOTE, OR SUCH OTHER LOAN DOCUMENT.
11.14. WAIVER OF JURY TRIAL. BORROWERS, FIRST UNION AS AGENT AND THE BANKS,
EACH HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OF THE LOAN
DOCUMENTS, OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS
AGREEMENT AND THE LENDER/BORROWERS RELATIONSHIP ESTABLISHED HEREBY. THE SCOPE OF
THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY
BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
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TRANSACTION, INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH
OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. BORROWERS, FIRST
UNION AS AGENT AND THE BANKS, EACH ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO THE TRANSACTION, THAT EACH HAS ALREADY RELIED ON THE WAIVER IN
ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER
IN THEIR RELATED FUTURE DEALINGS. BORROWERS, FIRST UNION AS AGENT AND THE BANKS,
EACH FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS WAIVER WITH ITS
LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE,
AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS,
MODIFICATIONS, REPLACEMENTS OR RESTATEMENTS TO THIS AGREEMENT, THE LOAN
DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS. IN THE
EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL
BY THE COURT.
11.15. Counterparts; Effectiveness. This Agreement and any amendment hereto
or waiver hereof may be signed in any number of counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument. This Agreement and any amendments hereto
or waivers hereof shall become effective when First Union, as Agent, shall have
received signed counterparts or notice by fax of the signature page that the
counterpart has been signed and is being delivered to it or facsimile that such
counterparts have been signed by all the parties hereto or thereto.
11.16. Use of Defined Terms. All words used herein in the singular or
plural shall be deemed to have been used in the plural or singular where the
context or construction so requires. Any defined term used in the singular
preceded by "any" shall be taken to indicate any number of the members of the
relevant class.
11.17. Offsets. Nothing in this Agreement shall be deemed a waiver or
prohibition of any Bank's right of banker's lien or offset.
11.18. Entire Agreement. This Agreement, the Notes issued hereunder and the
other Loan Documents constitute the entire understanding of the parties hereto
as of the date hereof with respect to the subject matter hereof and thereof and
supersede any prior agreements, written or oral, with respect hereto or thereto.
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IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to
be duly executed by their duly authorized representatives as of the date first
above written.
XXXXXXX (DE), INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
Xxxxxxx Systems, Inc.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
XXXXXXX, INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
Xxxxxxx Systems, Inc.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
SAFEWAY CHEMICAL TRANSPORTATION, INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
Xxxxxxx Systems, Inc.
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X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
BRITE-SOL SERVICES, INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
Xxxxxxx Systems, Inc.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
XXXXXXX LEASING, INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
Xxxxxxx Systems, Inc.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
SUPER SERVICE, INC.
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx X. Xxxxxx
Vice President & Chief Financial Officer
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Xxxxxxx Systems, Inc.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
FIRST UNION NATIONAL BANK
By ______________________________
Name:
Title:
Notices To:
Xxxxxxx Xxxxxxxxx
Vice President
First Union National Bank
Transportation and Equipment Finance Group
FC 1-8-11-24
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
FAX No. (000) 000-0000
CHASE BANK OF TEXAS, N.A.
By ______________________________
Name:
Title:
Notices To:
Xxx X. Sample
Senior Vice President
Chase Bank of Texas, N.A.
000 Xxxxxx
0xx Xxxxx
Xxxxxx, XX 00000
FAX No. (000) 000-0000
-53-
BANKBOSTON, NA
By ______________________________
Name:
Title:
Notices To:
Xxxx Xxxxx
Assistant Vice President
BankBoston, NA
Transportation Division
000 Xxxxxxx Xxxxxx
Mail Code: 01-08-01
Xxxxxx, XX 00000-0000
FAX No. (000) 000-0000
SUNTRUST BANK, ATLANTA
By ______________________________
Name:
Title:
By ______________________________
Name:
Title:
Notices To:
Xxxxx X. Xxxxxxxxxx
Vice President
SunTrust Bank, Atlanta
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
FAX No. (000) 000-0000
-54-
Reference Table of Definitions
definition page defined
Accounts.......................................................................1
Additional Amount.............................................................16
Adjusted LIBO Rate.............................................................1
Advances......................................................................13
Affiliate......................................................................1
Aggregate Loan Commitment.....................................................13
Agreement......................................................................2
Amortization Period............................................................2
Bank...........................................................................1
Banks..........................................................................1
Base Rate......................................................................2
Base Rate Loan.................................................................2
Borrowing Base.................................................................2
Borrowing Base Certificate.....................................................2
Business Day...................................................................2
Change of Control..............................................................2
Code...........................................................................3
Collateral.....................................................................3
Compliance Certificate.........................................................3
Consolidated Net Income........................................................3
Consolidated Net Worth.........................................................3
Consolidated Total Interest Expense............................................3
Contractual Obligation.........................................................3
Current Maturities.............................................................3
Default Rate...................................................................3
Dollars........................................................................3
EBITDA.........................................................................3
Eligible Accounts Receivables..................................................3
Eligible Equipment.............................................................4
Eligible Equipment Subject to Lease............................................4
Eligible Revenue Equipment.....................................................4
Environmental Laws.............................................................4
Equipment......................................................................4
ERISA..........................................................................4
ERISA Affiliate................................................................4
ERISA Event....................................................................5
Event of Default...............................................................5
Federal Funds Rate.............................................................5
-55-
First Union....................................................................1
Fiscal Quarter.................................................................5
Fiscal Year....................................................................5
Fixed Charge Coverage Ratio....................................................5
Future Lease Obligations.......................................................5
GAAP...........................................................................5
Generally Accepted Accounting Principles.......................................5
Governmental Authority.........................................................5
Indebtedness...................................................................5
Indemnitees...................................................................43
Intangible Assets..............................................................6
Interest Period................................................................6
Investment.....................................................................6
L/C Obligations................................................................7
Lease..........................................................................6
Lease in Good Standing.........................................................7
Leverage Ratio.................................................................7
LIBO Market Index Rate.........................................................7
LIBO Rate......................................................................7
LIBO Rate Loan.................................................................7
LIBO Rate Margin...............................................................7
Lien...........................................................................7
Loan..........................................................................13
Loan Commitment...............................................................13
Loan Commitment Fee............................................................8
Loan Commitment Percentage.....................................................8
Loan Documents.................................................................8
Loans.........................................................................13
London Business Day............................................................2
Material Adverse Effect........................................................8
Xxxxxxx........................................................................2
Multiemployer Plan.............................................................8
Net Book Value of Eligible Revenue Equipment...................................8
Note...........................................................................8
Obligations....................................................................8
Organization Documents.........................................................8
Participants..................................................................41
Participations................................................................41
PBGC...........................................................................8
Pension Plan...................................................................8
Permitted Liens................................................................9
Person.........................................................................9
Plan...........................................................................9
Potential Default..............................................................9
-56-
Regulation.....................................................................9
Regulation D..................................................................10
Regulatory Change.............................................................10
Rental and Lease Expense......................................................10
Reportable Event..............................................................10
Request.......................................................................14
Request for Advance...........................................................17
Required Banks................................................................10
Requirement of Law............................................................10
Reserve Percentage............................................................10
Responsible Officer...........................................................10
Revolver Termination Date.....................................................13
Revolving Credit Note.........................................................17
Revolving Credit Notes........................................................17
Revolving Loan Commitment Percentage..........................................15
SEC...........................................................................11
Security Agreement............................................................11
Short Term Advances...........................................................13
Solvent.......................................................................11
Standby Letter of Credit......................................................11
Subordinated Indebtedness.....................................................11
Subsidiary....................................................................11
Tangible Net Worth............................................................11
Unused Fee Percentage.........................................................12
Vehicle.......................................................................12
Wholly-Owned Subsidiary.......................................................12
Year 2000 Problem.............................................................12
-1-
EXHIBIT A
BANKS' COMMITMENTS AND PERCENTAGES
Bank Commitment Percentage
---- ---------- ----------
First Union National Bank $22,500,000 30.00%
Transportation and Equipment Finance Group
FC 1-8-11-24
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
FAX No. (000) 000-0000
Chase Bank of Texas, N.A. $12,500,000 16.67%
000 Xxxxxx
0xx Xxxxx
Xxxxxx, XX 00000
FAX No. (000) 000-0000
BankBoston, NA $20,000,000 26.67%
Transportation Division
000 Xxxxxxx Xxxxxx
Mail Code: 01-08-01
Xxxxxx, XX 00000-0000
FAX No. (000) 000-0000
SunTrust Bank, Atlanta $20,000,000 26.67%
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
FAX No. (000) 000-0000
EXHIBIT B
REVOLVING CREDIT NOTE
$__,000,000 Philadelphia, PA
August ___, 1998
For Value Received, XXXXXXX (DE), INC., XXXXXXX, INC., SAFEWAY CHEMICAL
TRANSPORTATION, INC., BRITE-SOL SERVICES, INC., XXXXXXX LEASING, INC., SUPER
SERVICE, INC. (individually a "Borrower" and collectively the "Borrowers"),
jointly and severally, hereby promise to pay to the order of ______________ (the
"Bank"), in lawful currency of the United States of America in immediately
available funds at the offices of First Union National Bank located at Broad and
Chestnut Streets, Philadelphia, Pennsylvania, on the Revolver Termination Date
or on such earlier date or dates as provided in the Credit Agreement described
below, the principal sum of ___________ DOLLARS ($__,000,000) or, if less, the
then unpaid principal amount of all Loans made by the Bank pursuant to the
Credit Agreement.
The Borrowers, jointly and severally, promise also to pay interest on the unpaid
principal amount hereof in like money at such office from the date hereof until
paid in full at the rates and at the times provided in the Credit Agreement.
This Note is one of the Revolving Credit Notes referred to in, is entitled to
the benefits of and is secured by security interests referred to in the Credit
Agreement, dated August 19, 1998, by and among the Borrowers and the banking
institutions named therein, with First Union National Bank as Agent (as such may
be amended, modified, supplemented, restated or replaced from time to time, the
"Credit Agreement"). This Note is subject to voluntary prepayment and mandatory
repayment prior to the Revolver Termination Date, in whole or in part, as
provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the maturity date of
the principal of and the accrued interest on this Note may be accelerated and be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
The Borrowers jointly and severally hereby waive presentment, demand, protest or
notice of any kind in connection with this Note.
Notwithstanding the face amount of this Note, the undersigned's liability
hereunder shall be limited, at all times, to the actual aggregate outstanding
indebtedness to the Bank relating to such Bank's Loans, including all principal
and interest, together with all fees and expenses as provided in the Credit
Agreement, as established by the Bank's books and records which shall be
conclusive absent manifest error.
Note _________________,_____
-1-
Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Credit Agreement.
Revolving Credit Note Dated August __, 1998
-2-
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OR CONFLICT OF LAWS.
XXXXXXX (DE), INC.
XXXXXXX, INC.
SAFEWAY CHEMICAL TRANSPORTATION, INC.
BRITE-SOL SERVICES, INC.
XXXXXXX LEASING, INC.
SUPER SERVICE, INC.
By ______________________________
Name:
Title:
Revolving Credit Note Dated August __, 1998
-3-
EXHIBIT C
TERM NOTE
$__,000,000 Philadelphia, PA
[date]
For Value Received, XXXXXXX (DE), INC., XXXXXXX, INC., SAFEWAY CHEMICAL
TRANSPORTATION, INC., BRITE-SOL SERVICES, INC., XXXXXXX LEASING, INC., SUPER
SERVICE, INC. (individually a "Borrower" and collectively the "Borrowers"),
jointly and severally, hereby promise to pay to the order of ______________ (the
"Bank"), in lawful currency of the United States of America in immediately
available funds at the offices of First Union National Bank located at Broad and
Chestnut Streets, Philadelphia, Pennsylvania, the principal sum of DOLLARS ($
,000,000) in equal monthly installments of principal each in the amount of $ due
and payable on the first Business Day of each calendar quarter, and a final
installment in the amount of principal remaining unpaid which shall be due and
payable on _____________ , 19__ .
The Borrowers, jointly and severally, promise also to pay interest on the unpaid
principal amount hereof in like money at such office from the date hereof until
paid in full at the rates and at the times provided in the Credit Agreement.
This Note is one of the Term Notes referred to in, is entitled to the benefits
of and is secured by security interests referred to in the Credit Agreement,
dated August 19, 1998, by and among the Borrowers and the banking institutions
named therein, with First Union National Bank as Agent (as such may be amended,
modified, supplemented, restated or replaced from time to time, the "Credit
Agreement"). This Note is subject to voluntary prepayment and mandatory
repayment, in whole or in part, as provided in the Credit Agreement. Any
prepayment shall be applied to principal in the inverse order of maturity.
In case an Event of Default shall occur and be continuing, the maturity date of
the principal of and the accrued interest on this Note may be accelerated and be
declared to be due and payable in the manner and with the effect provided in the
Credit Agreement.
The Borrowers jointly and severally hereby waive presentment, demand, protest or
notice of any kind in connection with this Note.
Notwithstanding the face amount of this Note, the undersigned's liability
hereunder shall include all principal and interest, together with all fees and
expenses as provided in the Credit Agreement, as established by the Bank's books
and records which shall be conclusive absent manifest error.
Revolving Credit Note Dated August __, 1998
-1-
Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Credit Agreement.
Term Note Dated________
-2-
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OR CONFLICT OF LAWS.
XXXXXXX (DE), INC.
XXXXXXX, INC.
SAFEWAY CHEMICAL TRANSPORTATION, INC.
BRITE-SOL SERVICES, INC.
XXXXXXX LEASING, INC.
SUPER SERVICE, INC.
By ______________________________
Name:
Title:
Term Note Dated _______
-3-
EXHIBIT D
BORROWING BASE CERTIFICATE
Term Note Dated _______
-1-
EXHIBIT E
SECURITY AGREEMENT
Note ______________,____
-1-
EXHIBIT F
COMPLIANCE CERTIFICATE
SCHEDULE 1
DISCLOSURE SCHEDULE
