CREDIT AGREEMENT
dated as of
December 5, 1995
among
MacDERMID, INCORPORATED
MacDERMID IMAGING TECHNOLOGY, INC.
the Banks signatory hereto
and
THE CHASE MANHATTAN BANK, N.A.
as Swingline Lender and Agent
Table of Contents
ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS
Section 1.1. Definitions 1
Section 1.2. Accounting Terms 14
Section 1.3. Construction 14
ARTICLE 2. THE CREDIT
Section 2.1. The Revolving Loans 15
Section 2.2. The Swingline Loans 15
Section 2.3. The Term Loans 16
Section 2.4. The Notes 16
Section 2.5. Letters of Credit 17
Section 2.6. Purpose 21
Section 2.7. Borrowing Procedures 21
Section 2.8. Payments, Prepayments and Conversions 21
Section 2.9. Interest Periods; Renewals 22
Section 2.10. Changes of Commitments 23
Section 2.11. Certain Notices 23
Section 2.12. Minimum Amounts 24
Section 2.13. Interest 24
Section 2.14. Fees 25
Section 2.15. Payments Generally 25
ARTICLE 3. YIELD PROTECTION; ILLEGALITY; ETC.
Section 3.1. Additional Costs 26
Section 3.2. Limitation of Types of Loans 27
Section 3.3. Illegality 28
Section 3.4. Certain Conversions pursuant to
Sections 3.1 and 3.3 28
Section 3.5. Certain Compensation 29
Section 3.6. Indemnification for Taxes 30
Section 3.7. Partial Defeasance 32
ARTICLE 4. CONDITIONS PRECEDENT
Section 4.1. Initial Conditions Precedent 32
Section 4.2. Subsequent Loans or Letters of Credit 34
Section 4.3. Deemed Representations 35
Section 4.4. First Borrowing by Each Eligible
Subsidiary 35
Section 4.5. Representations of Eligible
Subsidiaries 36
ARTICLE 5. REPRESENTATIONS AND WARRANTIES
Section 5.1. Incorporation, Good Standing and Due
Qualification 37
Section 5.2. Corporate Power and Authority; No
Conflicts 37
Section 5.3. Legally Enforceable Agreements 37
Section 5.4. Litigation 38
Section 5.5. Financial Statements; SEC Filings 38
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Section 5.6. Taxes 38
Section 5.7. ERISA 38
Section 5.8. Subsidiaries and Ownership of Stock 39
Section 5.9. Credit Arrangements 39
Section 5.10. No Default on Outstanding Judgments
or Orders 39
Section 5.11. Governmental Regulation 39
Section 5.12. Environmental Matters 39
Section 5.13. Margin Stock 40
Section 5.14. Full Disclosure 40
ARTICLE 6. AFFIRMATIVE COVENANTS
Section 6.1. Reporting Requirements 41
Section 6.2. Payment of Obligations 43
Section 6.3. Maintenance of Property; Insurance 43
Section 6.4. Conduct of Business and Maintenance
of Existence 44
Section 6.5. Compliance with Laws 44
Section 6.6. Inspection of Property, Books and
Records 45
Section 6.7. Maintenance of Ownership of
Subsidiaries 45
Section 6.8. Reviewed Division Financial Statements 45
ARTICLE 7. NEGATIVE COVENANTS
Section 7.1. Debt 45
Section 7.2. Restricted Payments 46
Section 7.3. Investments 46
Section 7.4. Negative Pledge 47
Section 7.5. Consolidations, Mergers and Sales
of Assets 47
Section 7.6. Transactions with Affiliates 48
ARTICLE 8. FINANCIAL COVENANTS
Section 8.1. EBIT to Interest Expense Ratio 49
Section 8.2. Minimum Consolidated Net Worth 49
Section 8.3. Maximum Total Debt to Net Worth Ratio 49
ARTICLE 9. EVENTS OF DEFAULT
Section 9.1. Events of Default 49
Section 9.2. Remedies 51
ARTICLE 10. THE AGENT; RELATIONS AMONG BANKS AND BORROWER
Section 10.1. Appointment, Powers and Immunities
of Agent 52
Section 10.2. Reliance by Agent 52
Section 10.3. Defaults 53
Section 10.4. Rights of Agent as a Bank 53
Section 10.5. Indemnification of Agent 53
Section 10.6. Documents 54
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Section 10.7. Non-Reliance on Agent and Other Banks 54
Section 10.8. Failure of Agent to Act 55
Section 10.9. Resignation of Agent 55
Section 10.10. Amendments Concerning Agency
Function 55
Section 10.11. Liability of Agent 56
Section 10.12. Transfer of Agency Function 56
Section 10.13. Non-Receipt of Funds by the Agent 56
Section 10.14. Withholding Taxes 56
Section 10.15. Several Obligations and Rights
of Banks 57
Section 10.16. PRO RATA Treatment of Loans, Etc 57
Section 10.17. Sharing of Payments Among Banks 57
ARTICLE 11. GUARANTY
Section 11.1. The Guaranty 58
Section 11.2. Guaranty Unconditional 58
Section 11.3. Discharge Only Upon Payment in Full;
Reinstatement in Certain
Circumstances 59
Section 11.4. Waiver by the Company 59
Section 11.5. Subrogation 59
Section 11.6. Stay of Acceleration 60
ARTICLE 12. MISCELLANEOUS
Section 12.1. Amendments and Waivers 60
Section 12.2. Usury 60
Section 12.3. Expenses; Indemnification 61
Section 12.4. Survival 62
Section 12.5. Assignments; Participations 62
Section 12.6. Notices 63
Section 12.7. Setoff 63
Section 12.8. Jurisdiction; Immunities 63
Section 12.9. Judgment Currency 64
Section 12.10. Confidentiality 64
Section 12.11. Table of Contents; Headings 65
Section 12.12. Severability 65
Section 12.13. Counterparts 65
Section 12.14. Integration 65
Section 12.15. Governing Law 65
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EXHIBITS
Exhibit A-1 Form of Revolving Promissory Note
Exhibit A-2 Form of Term Promissory Note
Exhibit A-3 Form of Swingline Promissory Note
Exhibit B Form of Authorization Letter
Exhibit C Form of Election to Participate
Exhibit D Form of Election to Terminate
Exhibit E Form of Opinion of Counsel for the Borrower
and MacDermid Imaging
Exhibit F Form of Opinion of Counsel for Each Eligible
Subsidiary
Exhibit G Revolving Loan Commitments
Exhibit H Term Loan Amounts
Exhibit I Forms of Letter of Credit Documents
Exhibit J Interest Margins and Commitment Fees
SCHEDULES
Schedule I Subsidiaries of the Borrower
Schedule II Credit Arrangements
Schedule III Litigation
Schedule IV Investments
Schedule V Environmental Disclosure
Schedule VI Hercules Division Monthly Management Report
iv
CREDIT AGREEMENT dated as of December 5, 1995 among
MacDERMID, INCORPORATED, a corporation organized under the laws
of the State of Connecticut (the "Company"), MacDERMID IMAGING
TECHNOLOGY, INC., a corporation organized under the laws of the
State of Delaware ("MacDermid Imaging"), each of the banks which
is now, or hereafter becomes, a signatory hereto (individually a
"Bank" and collectively the "Banks") and THE CHASE MANHATTAN
BANK, N.A., a national banking association organized under the
laws of the United States of America, as Swingline Lender (in
such capacity, together with its successors in such capacity, the
"Swingline Lender") and THE CHASE MANHATTAN BANK, N.A., as agent
for the Banks (in such capacity, together with its successors in
such capacity, the "Agent").
The Company and MacDermid Imaging desire that the Banks and
the Swingline Lender extend a $150,000,000 aggregate credit
facility as provided herein, and the Banks and the Swingline
Lender are prepared to extend such credit. Accordingly, the
Company, the Banks, the Swingline Lender and the Agent agree as
follows:
ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS
Section 1.1. DEFINITIONS. As used in this Agreement the
following terms have the following meanings:
"Additional Costs" shall have the meaning set forth in
Section 3.1(a).
"Affiliate" means (i) any Person that directly, or
indirectly through one or more intermediaries, controls the
Borrower (a "Controlling Person") or (ii) any Person (other than
the Borrower or a Subsidiary) which is controlled by or is under
common control with a Controlling Person. As used herein, the
term "control" means possession, directly or indirectly, of the
power to direct or cause the direction of the management or
policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" means The Chase Manhattan Bank, N.A.
"Agreement" means this Credit Agreement, as amended or
supplemented from time to time. References to Articles,
Sections, Exhibits, Schedules and the like refer to the Articles,
Sections, Exhibits, Schedules and the like of this Agreement
unless otherwise indicated.
"Alternative Currency" means Sterling, Deutschemarks, Lira,
Guilders or Francs or such other currency that the Banks may in
their sole discretion make available to one or more Borrowers
from time to time.
"Alternative Currency Equivalent" means with respect to an
amount of Dollars on any date in relation to any specific
Alternative Currency, the amount of such Alternative Currency
that may be purchased with such amount of Dollars at the Spot
Exchange Rate with respect to Dollars on such date.
"Alternative Currency Loan" means any Revolving Loan
denominated in an Alternative Currency.
"Authorization Letter" means the letter agreement executed
by the Borrower in the form of EXHIBIT B.
"Banking Day" means any day on which commercial banks are
not authorized or required to close in New York City and whenever
such day relates to a Eurocurrency Loan or notice with respect to
any Eurocurrency Loan, a day on which dealings in Dollar deposits
are also carried out in the London interbank market.
"Benefit Arrangement" means at any time an employee benefit
plan within the meaning of Section 3(3) of ERISA which is not a
Plan or Multiemployer Plan and which is maintained or otherwise
contributed to by any member of the ERISA Group.
"Borrower" means the Company, MacDermid Imaging or any
Eligible Subsidiary, as the context may require, and their
respective successors and assigns and "Borrowers" means all of
the foregoing.
"Borrowing" means a Loan or group of Loans of a single type
as to which a single Interest Period is in effect.
"Borrowing Request" means a request by a Borrower in
accordance with Section 2.7.
"Capital Expenditures" means for any period, the Dollar
amount of gross expenditures (including obligations under Capital
Leases) made for fixed assets, real property, plant and
equipment, and all renewals, improvements and replacements
thereto (but not repairs thereof) incurred during such period.
"Capital Lease" means any lease which has been or should be
capitalized on the books of the lessee in accordance with
generally accepted accounting principles.
"Closing Date" means the date this Agreement has been
executed by the Company, the Banks and the Agent.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Commitment" means with respect to each Bank, the obligation
of such Bank to make Revolving Loans under this Agreement in the
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aggregate principal amount set forth on EXHIBIT G, as such amount
may be reduced or otherwise modified from time to time pursuant
to the terms hereof.
"Common Stock" means common stock, no par value, of the
Company.
"Company" means MacDermid, Incorporated, a Connecticut
corporation, and its successors and assigns.
"Consolidated Capital Expenditures" means Capital
Expenditures of the Company and its Consolidated Subsidiaries on
a consolidated basis.
"Consolidated EBIT" means, for any period the sum of
(a) Consolidated Net Income of the Company and its Consolidated
Subsidiaries for such period, plus (b) to the extent deducted in
determining Consolidated Net Income, the sum of (i) Consolidated
Interest Expense and (ii) consolidated taxes of the Company and
its Consolidated Subsidiaries for such period.
"Consolidated EBITDA" means, for any period, the sum of
(a) Consolidated Net Income of the Company and its Consolidated
Subsidiaries for such period, PLUS (b) to the extent deducted in
determining such Consolidated Net Income, the sum of
(i) Consolidated Interest Expense, (ii) consolidated depreciation
and amortization expense and (iii) consolidated taxes of the
Company and its Consolidated Subsidiaries for such period.
"Consolidated Interest Expense" means, for any period, the
interest expense of the Company and its Consolidated Subsidiaries
determined on a consolidated basis for such period.
"Consolidated Net Income" means, for any period, the net
income of the Company and its Consolidated Subsidiaries for such
period as adjusted to exclude the following:
(a) the effect of each change in accounting principles;
(b) any gain, together with any related provisions for
taxes on such gain, realized upon the sale or other disposition
of any asset of the Company or any Consolidated Subsidiary
(including pursuant to any sale/leaseback transaction) which is
not sold or otherwise disposed of in the ordinary course of
business;
(c) any gain or loss, together with any related provision
for taxes on such gain, realized in connection with the
extinguishment of any Debt of the Company or any of its
Consolidated Subsidiaries;
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(d) all extraordinary gains and losses determined in
accordance with generally accepted accounting principles;
(e) all foreign currency translation gains and losses;
(f) the net income or loss of any Person that is not a
Consolidated Subsidiary of the Company or that the Company
accounts for by the equity method of accounting, whether or not
distributed to the Company; and
(g) the net income or loss of any Person acquired in a
pooling of interests transaction for any period prior to the date
of such acquisition.
"Consolidated Net Worth" means at any date the consolidated
stockholders' equity of the Company and its Consolidated
Subsidiaries, including the Preferred Stock, as of such date.
"Consolidated Subsidiary" means any Subsidiary whose
accounts are, or are required to be, consolidated with the
accounts of the Company.
"Consolidated Total Debt" means at any date the total Debt
of the Company and its Consolidated Subsidiaries on a
consolidated basis.
"Debt" means, with respect to any Person at any date,
without duplication: (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (c) all
obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in
the ordinary course of business, (d) all obligations of such
Person as lessee which are capitalized in accordance with
generally accepted accounting principles, (e) all obligations of
such Person to reimburse or prepay any bank or other Person in
respect of amounts paid under a letter of credit, banker's
acceptance or similar instrument, whether drawn or undrawn
(PROVIDED, however, if the Company provides standby letters of
credit or bank guarantees in support of obligations of a
Subsidiary, only the underlying obligation and not the contingent
liability created by the letter of credit or bank guaranty shall
be treated as Debt of the Company and such Subsidiary), (f) all
Debt of other Persons secured by a Lien on any asset of such
Person, whether or not such Debt is assumed by such Person, and
(g) all Debt of other Persons Guaranteed by such Person.
"Default" means any event which constitutes an Event of
Default or which with the giving of notice or lapse of time, or
both, would become an Event of Default.
4
"Default Rate" means, with respect to an amount of any Loan
not paid when due, a rate per annum equal to: (a) if such Loan
is a Variable Rate Loan, a variable rate 2% above the rate of
interest thereon; (b) if such Loan is a Eurocurrency Loan, a
fixed rate 2% above the rate of interest in effect thereon
(including any Interest Margin).
"Denomination Date" means (a) in relation to any Borrowing
in an Alternative Currency, the date that is three Banking Days
prior to the date such Borrowing is made and in the case of a
renewal of, or conversion to, such a Loan, the date that is three
Banking Days prior to the date of such renewal or conversion, and
(b) in relation to any Letter of Credit payable in an Alternative
Currency the date such Letter of Credit is issued or, in the case
of Letters of Credit to fund insurance payments, renewed, as
applicable.
"Deutschemarks" and the sign "DM" means lawful money of
Germany.
"Dollars" and the sign "$" mean lawful money of the United
States of America.
"Dollar Equivalent" means, with respect to an amount of any
Alternative Currency on any date, the amount of Dollars that may
be purchased with such amount of such Alternative Currency at the
Spot Exchange Rate with respect to such Alternative Currency on
such date.
"Election to Participate" means an Election to Participate
substantially in the form of EXHIBIT C.
"Election to Terminate" means an Election to Terminate
substantially in the form of EXHIBIT D.
"Eligible Subsidiary" means any Wholly-Owned Consolidated
Subsidiary of the Company as to which an Election to Participate
shall have been delivered to the Agent and as to which an
Election to Terminate shall not have been delivered to the Agent.
Each such Election to Participate and Election to Terminate shall
be duly executed on behalf of such Wholly-Owned Consolidated
Subsidiary and the Company in such number of copies as the Agent
may request. The delivery of an Election to Terminate shall not
affect any obligation of an Eligible Subsidiary theretofore
incurred. The Agent shall promptly give notice to the Banks of
the receipt of any Election to Participate or Election to
Terminate.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations,
ordinances, rules, judgments, orders, decrees, injunctions,
permits, conversions, grants, franchises, licenses, agreements
5
and other governmental restrictions relating to the environment,
to the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous
Substances or wastes into the environment, including ambient air,
surface water, ground water or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants,
Hazardous Substances or wastes or the clean up or other
remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor statute
including any rules and regulations promulgated thereunder.
"ERISA Group" means the Company, any Subsidiary and all
members of a controlled group of corporations and all trades or
businesses (whether or not incorporated) under common control
which, together with the Borrower or any Subsidiary, are treated
as a single employer under Section 414(c) of the Code.
"Eurocurrency Loan" means any Loan when and to the extent
the interest rate therefor is determined on the basis of the
definition "Fixed Base Rate."
"Event of Default" has the meaning given such term in
Section 9.1.
"Existing Credit Facility" means that certain Credit
Agreement, dated as of October 6, 1994, between the Company, the
banks signatory thereto, and The Chase Manhattan Bank, N.A., as
agent, as heretofore amended.
"Facility Documents" means this Agreement, the Notes, the
Guaranty and any documents relating to Letters of Credit.
"Federal Funds Rate" means, for any day, the rate per annum
equal to the weighted average of the rates on overnight federal
funds transactions as published by the Federal Reserve Bank of
New York for such day (or for any day that is not a Banking Day,
for the immediately preceding Banking Day).
"Fixed Base Rate" means with respect to any Interest Period
for a Eurocurrency Loan, the rate per annum (rounded upwards if
necessary to the nearest 1/16 of 1%) quoted at approximately
11:00 a.m. London time by the principal London branch of the
Agent two (2) Banking Days prior to the first day of such
Interest Period for the offering to leading banks in the London
interbank market of Dollar deposits or deposits in an Alternative
Currency, as the case may be, in immediately available funds, for
a period, and in an amount, comparable to the Interest Period and
6
principal amount of the Eurocurrency Loan which shall be made by
the Banks and outstanding during such Interest Period.
"Fixed Rate" means, for any Eurocurrency Loan for any
Interest Period therefor, a rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the Agent to
be equal to the quotient of (a) the Fixed Base Rate for such Loan
for such Interest Period, divided by (b) one minus the Reserve
Requirement for such Loan for such Interest Period.
"Francs" and the sign "FF" means lawful money of France.
"Funding Date" means the date of the earlier to occur of
(a) the initial Borrowing Request, (b) the initial issuance of a
Letter of Credit and (c) extension of the principal amount of the
Term Loan being advanced to MacDermid Imaging.
"Guarantee" means any obligation, contingent or otherwise,
of any Person directly or indirectly guaranteeing any Debt or
other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (a) to purchase or pay
(or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase
assets, goods, securities or services, to take-or-pay, or to
maintain financial statement conditions or otherwise) or
(b) entered into for the purpose of assuring in any other manner
the obligee of such Debt or other obligation of the payment
thereof or to protect such obligee against loss in respect
thereof (in whole or in part); PROVIDED that the term Guarantee
shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb
has a corresponding meaning.
"Guarantors" means MacDermid Overseas Asia Limited,
MacDermid Europe, Inc., MacDermid Equipment, Inc. and MacDermid
Imaging Technology, Inc.
"Guaranty" means the Joint and Several Guaranty of the
Guarantors in favor of the Agent for the benefit of the Banks.
"Guilders" means the lawful money of the Netherlands.
"Hazardous Substances" means any toxic, radioactive, caustic
or otherwise hazardous substance, including petroleum, its
derivatives, by-products and other hydro-carbons, or any
substance having any constituent elements displaying any of the
foregoing characteristics and any other element, compound,
"Intercompany Debt" means Debt representing loans from the
Company to any Subsidiary which is not a Guarantor.
7
mixture, solution or substance poses a present or potential
hazard to human health or the environment.
"Hercules Division" means the Electronics and Printing
Division of Hercules Incorporated.
"Interest Margin" means for Variable Rate Loans and
Eurocurrency Loans the applicable number of basis points
specified on EXHIBIT J based on the ratio of Debt of the Company
and its Consolidated Subsidiaries on a consolidated basis to
Consolidated EBITDA minus Consolidated Capital Expenditures. The
above ratio will be tested at the end of each calendar quarter
for the twelve-month period then ended and will be in effect with
respect to any Borrowing, conversion or renewal made subsequent
to the receipt by the Agent of the certificate described in
Section 6.1(c). hereof and prior to the Agent's receipt of the
next such certificate, PROVIDED that the Interest Margin for all
Eurocurrency Loans shall be 125 basis points with respect to any
Borrowing, conversion or renewal made after the date on which
such a certificate is to be delivered and prior to the date such
certificate is actually delivered.
"Interest Period" means, with respect to any Eurocurrency
Loan, the period commencing on the date such Loan is made,
converted from another type of Loan or renewed, as the case may
be, and ending, as the applicable Borrower may select pursuant to
Section 2.9, on the numerically corresponding day in the first,
second, third, or sixth calendar month thereafter, PROVIDED that
each such Interest Period which commences on the last Banking Day
of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Banking Day of the
appropriate calendar month.
"Investment" means any investment in any Person, whether by
means of share purchase, capital contribution, loan, time deposit
or otherwise.
"Lending Office" means, for each Bank and for each type of
Loan, the lending office of such Bank (or of an affiliate of such
Bank) designated as such for such type of Loan on its signature
page hereof or such other office of such Bank (or of an affiliate
of such Bank) as such Bank may from time to time specify to the
Agent and the Company as the office by which its Loans of such
type are to be made and maintained.
"Letter(s) of Credit" means any standby Letter of Credit
issued by the Agent for the account of a Borrower pursuant to
Borrowers, as at any date of determination, the sum of (i) the
maximum aggregate amount which is or at any time thereafter may
become available (including any amounts drawn but not yet
honored) under all Letters of Credit then outstanding and
8
Section 2.5 for the purpose of supporting performance, payment
deposit, or surety obligations of such Borrower, in any case if
required by law or governmental rule or regulation or if in
accordance with the custom or practice in the industry of such
Borrower.
"Letters of Credit Usage" means with respect to the
(ii) the aggregate amount of all drawings under Letters of Credit
honored by the Agent and not theretofore reimbursed by a
Borrower. Letters of Credit Usage of each Bank shall be
determined as if the Banks had bought the participations referred
to in Section 2.5(a) with respect to all then outstanding Letters
of Credit. In determining Letters of Credit Usage, any Letters
of Credit denominated in an Alternative Currency, shall be
converted to the Dollar Equivalent (as of the Denomination Date
for such Letter of Credit).
"Lien" means with respect to any asset, any mortgage, deed
of trust, lien (statutory or otherwise), pledge, charge, security
interest or encumbrance of any kind, or any other type of
preferential arrangement that has the practical effect of
creating a security interest, in respect of such asset. For the
purposes of this Agreement, the Company or any Subsidiary shall
be deemed to own subject to a Lien any asset which the Company or
such Subsidiary has acquired or holds subject to the interest of
a vendor or lessor under any conditional sale agreement, Capital
Lease or other title retention agreement relating to such asset.
"Lira" means lawful money of Italy.
"Loan" or "Loans" means the Revolving Loans, the Swingline
Loans and the Term Loans made by a Bank pursuant to Section 2.1,
Section 2.2 or Section 2.3.
"MacDermid Imaging" means MacDermid Imaging Technology, Inc.
a Delaware corporation and a wholly-owned subsidiary of the
Company, and its successors and assigns.
"Material Debt" means Debt (other than the Notes) of the
Company and/or one or more of its Subsidiaries, arising in one or
more related or unrelated transactions, in an aggregate principal
amount exceeding $1,000,000.
"Material Plan" means at any time a Plan or Plans having an
aggregate amount of Unfunded Liabilities in excess of $500,000.
"Maturity Date" means December 4, 2002; PROVIDED that if
such date is not a Banking Day, the Maturity Date shall be the
next succeeding Banking Day.
(5) plan years made contributions, including for these purposes
9
"Monthly Management Report" means the September 30, 1995
Monthly Management Report of the Hercules Division a copy of
which is attached hereto as Schedule VI.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to
which any member of the ERISA Group is then making or accruing an
obligation to make contributions or has within the preceding five
any Person which ceased to be a member of the ERISA Group during
such five year-period.
"Note" or "Notes" means a promissory note of a Borrower in
the form of EXHIBIT X-0, XXXXXXX X-0 or EXHIBIT A-3 evidencing
the Loans made by a Bank or Swingline Lender hereunder and all
promissory notes delivered in substitution or exchange therefor,
in each case as the same shall be modified and supplemented and
in effect from time to time.
"PBGC" means the Pension Benefit Guaranty Corporation and
any entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" means:
(a) in the case of real properties, easements,
restrictions, exceptions, reservations or defects which, in
the aggregate, do not interfere materially with the
continued use of such properties for the purposes for which
they are used and do not affect materially the value
thereof;
(b) liens, if contested in good faith by appropriate
proceedings and appropriate reserves are maintained with
respect thereto;
(c) pledges or deposits to secure obligations under
workmen's compensation laws or similar legislation or to
secure performance in connection with bids, tenders and
contracts (other than contracts for the payment of borrowed
money) to which the Company or any of its Subsidiaries is a
party;
(d) deposits to secure public or statutory obligations of
the Company or any of its Subsidiaries;
(e) materialmen's, mechanics', carriers', workmen's or
other like liens arising in the ordinary course of business,
or deposits of cash or United States obligations to obtain
the release of such liens;
(f) deposits to secure surety or appeal bonds in
proceedings to which the Company or any of its Subsidiaries
is a party;
10
(g) existing leases by the Company or its Subsidiaries of
real and personal property;
(h) liens for taxes not yet due and payable; and
(i) liens on the assets acquired by the Company pursuant
to the Purchase Agreement that are acceptable to the Agent
as of the Closing Date in the Agent's sole discretion.
"Person" means an individual, partnership, limited liability
partnership, corporation, limited liability company, business
trust, joint stock company, trust, unincorporated association,
joint venture, governmental authority or other entity of whatever
nature.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of
ERISA or subject to the minimum funding standards set forth in
Section 412 of the Code and either (a) is maintained, or
contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (b) has at any time within the
preceding five (5) years been maintained, or contributed to, by
any Person which was at such time a member of the ERISA Group for
employees of any Person which was at such time a member of the
ERISA Group.
"Preferred Stock" means the preferred stock issued by
MacDermid Imaging to Hercules, Inc. pursuant to the terms of the
Purchase Agreement.
"Preferred Stock Agreement" means that certain Series A
Preferred Stock Agreement among MacDermid Imaging, the Company
and Hercules, Inc. with respect to the Preferred Stock.
"Prime Rate" means that rate of interest from time to time
announced by the Agent at its principal office as its prime
commercial lending rate. Notwithstanding the foregoing, each
Borrower acknowledges that the Agent may regularly make
commercial loans at rates of interest less than the rate of
interest referred to in the immediately preceding sentence.
"Principal Office" means the principal office of the Agent,
presently located at Xxx Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
"Prohibited Transaction" means any transaction set forth in
Section 406 of ERISA or Section 4975 of the Code.
"Purchase Agreement" means the Sale and Purchase Agreement,
together with each Annex, Schedule and Exhibit thereto, among the
Company, MacDermid Imaging and Hercules Incorporated.
11
"Regulation D" means Regulation D of the Board of Governors
of the Federal Reserve System as the same may be amended or
supplemented from time to time.
"Regulation U" means Regulation U of the Board of Governors
of the Federal Reserve System as the same may be amended or
supplemented from time to time.
"Regulatory Change" means, with respect to any Bank, any
change after the date of this Agreement in United States or
foreign federal, state or municipal laws or regulations
(including Regulation D) or the adoption or making after such
date of any interpretations, directives or requests applying to a
class of banks including such Bank of or under any United States
or foreign federal, state or municipal laws or regulations
(whether or not having the force of law) by any court or
governmental or monetary authority charged with the
interpretation or administration thereof.
"Reportable Event" means any of the events set forth in
Section 4043(b) of ERISA as to which events the PBGC by
regulation has not waived the requirement of Section 4043(a) of
ERISA that the PBGC be notified within thirty (30) days of the
occurrence of such event, PROVIDED that a failure to meet the
minimum funding standard of Section 412 of the Code or Section
302 of ERISA shall be a Reportable Event regardless of any
waivers given under Section 412(d) of the Code.
"Required Banks" means, at any time while no Revolving Loans
are outstanding, Banks having at least 51% of the aggregate
amount of the Commitments and Term Loans outstanding and, at any
time while Revolving Loans are outstanding, Banks holding at
least 51% of the aggregate principal amount of the Loans.
"Reserve Requirement" means, for any Eurocurrency Loan for
any Interest Period therefor, the average maximum rate at which
reserves (including any marginal, supplemental or emergency
reserves) are required to be maintained during such Interest
Period under Regulation D by member banks of the Federal Reserve
System in New York City with deposits exceeding $1,000,000,000
against "Eurocurrency liabilities" (as such term is used in
Regulation D). Without limiting the effect of the foregoing, the
Reserve Requirement shall reflect any other reserves required to
be maintained by such member banks by reason of any Regulatory
Change against any category of extensions of credit or other
assets which include Variable Rate Loans.
"Restricted Payment" means (a) any dividend or other
distribution on any shares of any Borrower's capital stock
(except dividends payable solely in shares of such Borrower's
capital stock), (b) any payment on account of the purchase,
12
redemption, retirement or acquisition of (i) any shares of any
Borrower's capital stock or (ii) any option, warrant or other
right to acquire shares of any Borrower's capital stock or (c)
any payment by any Borrower of a "Performance Premium" (as that
term is defined in the Purchase Agreement) to Hercules
Incorporated.
"Revolving Loans" means revolving Loans made by the Banks
pursuant to Section 2.1 hereof.
"Senior Debt" means Debt which has been or is incurred by
the Borrower which is senior in right of payment pursuant to its
terms to the Debt under this Agreement.
"Spot Exchange Rate" means, on any day, (a) with respect to
any Alternative Currency, the spot rate at which Dollars are
offered on such day by the Agent in London for such Alternative
Currency at approximately 11:00 a.m. (London time), and (b) with
respect to Dollars in relation to any specified Alternative
Currency, the spot rate at which such specified Alternative
Currency is offered on such day by the Agent in London for
Dollars at approximately 11:00 a.m. (London time). For purposes
of determining the Spot Exchange Rate in connection with an
Alternative Currency Borrowing, such Spot Exchange Rate shall be
determined as of the Denomination Date for such Borrowing with
respect to transactions in the applicable Alternative Currency
that will settle on the date of such Borrowing.
"Sterling" or "(pound sterling symbol)" means lawful money
of the United Kingdom.
"Subsidiary" means, as to any Person, any corporation or
other entity of which at least a majority of the securities or
other ownership interests having ordinary voting power
(absolutely or contingently) for the election of directors or
other persons performing similar functions are at the time owned
directly or indirectly by such Person.
"Swingline Commitment" shall mean the obligation of the
Swingline Lender to make Swingline Loans pursuant to Section 2.2
hereof in an aggregate amount at any one time outstanding up to
but not exceeding $5,000,000 (as the same may be reduced at any
time or from time to time pursuant to Section 2.10 hereof).
"Swingline Loans" means the Swingline Loans made by the
Swingline Lender pursuant to Section 2.2 hereof.
"Termination Date" means December 4, 2000; PROVIDED that if
such date is not a Banking Day, the Termination Date shall be the
next succeeding Banking Day (or, if such next succeeding Banking
Day falls in the next calendar month, the next preceding Banking
Day).
13
"Term Loans" means the Term Loans made by the Banks pursuant
to Section 2.3 hereof.
"Unfunded Liabilities" means with respect to any Plan at any
time, the amount (if any) by which (a) the value of all benefit
liabilities under such Plan, determined on a plan termination
basis using the assumptions prescribed by the PBGC for purposes
of Section 4044 of ERISA, exceeds (b) the fair market value of
all Plan assets allocable to such liabilities under Title IV of
ERISA (excluding any accrued but unpaid contributions), but only
to the extent that such excess represents a potential liability
of any member of the ERISA Group to the PBGC or any other Person
under Title IV of ERISA.
"Variable Rate" means, for any day, the higher of (a) the
Federal Funds Rate for such day plus 1/2 of 1% or (b) the Prime
Rate for such day.
"Variable Rate Loan" means any Loan when and to the extent
the interest rate for such Loan is determined in relation to the
Variable Rate.
"Wholly-Owned Consolidated Subsidiary" means any
Consolidated Subsidiary all of the shares of capital stock or
other ownership interests of which (except directors' qualifying
shares) are at the time directly or indirectly owned by the
Company.
Section 1.2. ACCOUNTING TERMS. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted,
all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be
prepared in accordance with generally accepted accounting
principles as in effect from time to time, applied on a basis
consistent (except for changes concurred in by the Company's
independent public accountants) with the most recent audited
consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Banks; PROVIDED that,
if the Company notifies the Agent that the Company wishes to
amend any covenant in Article 8 to eliminate the effect of any
change in generally accepted accounting principles on the
operation of such covenant (or if the Agent notifies the Company
that the Required Banks wish to amend Article 8 for such
purpose), then the Company's compliance with such covenant shall
be determined on the basis of generally accepted accounting
principles in effect immediately before the relevant change in
generally accepted accounting principles became effective, until
either such notice is withdrawn or such covenant is amended in a
manner satisfactory to the Company and the Required Banks.
14
Section 1.3. CONSTRUCTION. Unless the context of this
Agreement otherwise clearly requires, references to the plural
include the singular, references to the singular include the
plural, references to any gender include the other genders, the
term "including" is not limiting and has the inclusive meaning
represented by the phrase "including without limitation;" and the
term "or" has the inclusive meaning represented by the phrase
"and/or." The terms "hereof," "herein," "hereunder" and similar
terms in this Agreement refer to this Agreement as a whole and
not to any particular provision of this Agreement.
ARTICLE 2. THE CREDIT
Section 2.1. THE REVOLVING LOANS. (a) Subject to the terms
and conditions of this Agreement, each of the Banks severally and
not jointly agrees to make Revolving Loans to the Company and its
Eligible Subsidiaries (as specified in the Borrowing Request with
respect thereto) from time to time from and including the date
hereof to and including the Banking Day next preceding the
Termination Date, in an aggregate principal amount up to but not
exceeding at any one time outstanding, the amount of its
Commitment; PROVIDED that the aggregate amount of Revolving Loans
outstanding plus the Letters of Credit Usage shall not at any
time exceed in the aggregate Commitments of the Banks. Each
Borrowing under this Section 2.1 shall be made by the Banks
ratably in accordance with their Commitments. The Revolving
Loans may be outstanding as Variable Rate Loans or Eurocurrency
Loans (each a "type" of Loan). Eurocurrency Loans may be
denominated in Dollars or in one or more Alternative Currencies,
and all Variable Rate Loans shall be denominated only in Dollars.
Subject to the terms hereof, the Borrowers may borrow, repay or
prepay and reborrow Revolving Loans hereunder prior to the
Termination Date. Each type of Loan of each Bank shall be made
and maintained at such Bank's Lending Office for such type of
Loans.
(b) Any Revolving Loans may be made in the Alternative
Currency specified in the applicable Borrowing Request given
pursuant to Section 2.7 in an amount equal to the Alternative
Currency Equivalent of the Dollar amount specified in such
Borrowing Request, as determined by the Agent as of the
Denomination Date for such Borrowing (which determination shall
be conclusive absent manifest error). For purposes of
determining the amount outstanding under any Bank's Commitment,
such amount outstanding for each Alternative Currency Loan shall
be the Dollar Equivalent for such Loan as of the Denomination
Date.
Section 2.2. THE SWINGLINE LOANS (a) Subject to the terms
and conditions of this Agreement, the Swingline Lender agrees to
make Swingline Loans to the Company and its Eligible Subsidiaries
15
(as specified in the Borrowing Request with respect thereto) from
time to time from and including the date hereof to and including
the Banking Day next preceding the Termination Date, in an
aggregate principal amount at any one time outstanding up to but
not exceeding the Swingline Commitment, PROVIDED that the
Swingline Loans outstanding PLUS the Revolving Loans PLUS the
Letters of Credit Usage of the Swingline Lender shall not at any
time exceed the Commitment of the Agent, and PROVIDED further
that the aggregate amount of Revolving Loans outstanding PLUS the
Letters of Credit Usage PLUS Swingline Loans shall not at any
time exceed the aggregate Commitments of the Banks. Each
Borrowing under this Section 2.2 shall be made by the Agent. The
Swingline Loans may be outstanding as Variable Rate Loans or
Eurocurrency Loans (each a "type" of Loan). Eurocurrency Loans
may be denominated in Dollars or in one or more Alternative
Currencies, and all Variable Rate Loans shall be denominated only
in Dollars. Subject to the terms hereof, the Borrowers may
borrow, repay or prepay and reborrow Swingline Loans hereunder
prior to the Termination Date.
(b) Any Swingline Loans may be made in the Alternative
Currency specified in the applicable Borrowing Request given
pursuant to Section 2.7 in an amount equal to the Alternative
Currency Equivalent of the Dollar amount specified in such
Borrowing Request, as determined by the Agent as of the
Denomination Date for such Borrowing (which determination shall
be conclusive absent manifest error).
(c) Each Bank irrevocably agrees that if a Borrower fails
to repay a Swingline Loan to the Agent when due (including upon
an Event of Default and acceleration of such Loans) then each
Bank shall be deemed to have purchased participations in the
Swingline Loans in proportion to their respective Commitments.
Section 2.3. THE TERM LOANS. Subject to the terms and
conditions of this Agreement, each of the Banks, severally and
not jointly, agrees to make a Term Loan to MacDermid Imaging on
the Closing Date in an amount equal to that set forth opposite
its name on EXHIBIT H. The Term Loans may be outstanding as
Variable Rate Loans or Eurocurrency Loans. All Term Loans shall
be denominated in Dollars.
Section 2.4. THE NOTES. (a) The Revolving Loans of each
Bank shall be evidenced by a promissory note in favor of such
Bank in the form of EXHIBIT A-1, dated the date of this
Agreement, duly completed and executed by the applicable
Borrower. Each Bank shall, and is hereby authorized by each of
the Borrowers to, endorse on the schedule attached to each Note
held by such Bank, or otherwise record in such Bank's internal
records, an appropriate notation evidencing the date, type,
amount and currency of each Revolving Loan or Swingline Loan
evidenced by such Note and the date, amount and currency of each
16
repayment or prepayment of principal; PROVIDED that the failure
of any Bank to make such notation or any error therein shall not
affect the obligations of the applicable Borrower to repay the
Revolving Loans or Swingline Loans made by such Bank.
(b) The Swingline Loans of the Swingline Lender shall be
evidenced by a promissory note in favor of the Swingline Lender
in the form of EXHIBIT A-3, dated the date of this Agreement,
duly completed and executed by the applicable Borrower. The
Swingline Lender shall, and is hereby authorized by each of the
Borrowers to, endorse on the schedule attached as the Swingline
Note, or otherwise record in such Bank's internal records, an
appropriate notation evidencing the date, type, amount and
currency of each Swingline Loan evidenced by such Note and the
date, amount and currency of each repayment or prepayment of
principal; PROVIDED that the failure of the Swingline Lender to
make such notation or any error therein shall not affect the
obligations of the applicable Borrower to repay the Swingline
Loans made by the Swingline Lender.
(c) The Term Loans of each Bank shall be evidenced by a
promissory note in favor of such Bank in the form of EXHIBIT A-2,
dated the date of this Agreement, duly completed and executed by
MacDermid Imaging.
Section 2.5. LETTERS OF CREDIT. (a) Subject to the terms
and conditions of this Agreement, in addition to requesting that
the Banks make the Loans, any Borrower may request, in accordance
with the provisions of this Section 2.5(a), that the Agent issue
Letters of Credit for the account of such Borrower; PROVIDED that
(i) no Borrower shall request that the Agent issue any Letter of
Credit if, after giving effect to such issuance, the aggregate
outstanding Revolving Loans to the Borrowers plus the aggregate
amount of Letters of Credit Usage would exceed the aggregate of
all Commitments, (ii) in no event shall the Agent issue (A) any
Letter of Credit having an expiration date later than the tenth
Banking Day prior to the Termination Date, or (B) any Letter of
Credit having an expiration date more than one year after its
date of issuance, except those used to fund payment of insurance
premiums which, by their terms, are renewed automatically, and
(iii) no Borrower shall request that the Agent issue any Letter
of Credit if, after giving effect to such issuance, the aggregate
Letter of Credit Usage would exceed $15,000,000. The issuance of
any Letter of Credit in accordance with the provisions of this
Section 2.5(a) shall require the satisfaction of each condition
set forth in Article 4. All Letters of Credit may be denominated
in Dollars or in an Alternative Currency.
Immediately upon the issuance of each Letter of Credit, each
Bank shall be deemed to, and hereby agrees to, have irrevocably
agreed to participate with the Agent in such Letter of Credit and
any drawing thereunder in an amount equal to such Bank's ratable
17
share (determined in accordance with such Bank's Commitment) of
the maximum amount which is or at any time may become available
to be drawn thereunder.
Each Letter of Credit may provide that the Agent, with the
written consent of the Required Banks, may (but shall not be
required to) pay all or any part of the maximum amount which may
at any time be available for drawing thereunder to the
beneficiary thereof upon the occurrence of an Event of Default
and the acceleration of the maturity of the Loans. If payment is
not due to the beneficiary of an outstanding Letter of Credit,
upon the occurrence of an Event of Default the applicable
Borrower shall deposit immediately available funds, in the
applicable currency, in an account or fund a cash collateral
account, in the applicable currency, with the Agent to secure
payment to the beneficiary under such Letter of Credit. Any
funds so deposited or standing to the credit of such account
shall be paid to the beneficiary of such Letter of Credit if
conditions to such payment are satisfied or returned to the Agent
for distribution to the Banks (or, if all Loans shall have been
repaid in full in cash in the applicable currency, to the
applicable Borrower) if no payment to the beneficiary has been
made and the final date available for drawings under such Letter
of Credit has passed. Each payment or distribution of funds by
the Agent as provided in this paragraph shall be treated for all
purposes of this Agreement as a drawing duly honored by the Agent
under the related Letter of Credit and each deposit by the
Borrower as provided in this paragraph shall be treated for all
purposes of this Agreement as a reimbursement by Borrower for a
portion of such drawing equal to the amount of such deposit.
(b) Whenever a Borrower desires the issuance of a Letter of
Credit, it shall deliver to the Agent at the Principal Office a
written notice no later than 1:00 p.m. (New York City local time)
at least ten (10) Banking Days prior to the proposed date of
issuance. Such notice shall consist of the form of application
and agreement for letters of credit customarily used by the
Agent, a copy of the current form of which is attached hereto as
EXHIBIT I, as such document may be amended from time to time.
Promptly after receipt of a notice of desired issuance of a
Letter of Credit, (i) if the conditions set forth in Section
2.5(a) have been satisfied, the Agent shall notify each Bank of
the proposed issuance and the amount of each such other Bank's
respective participation therein, determined in accordance with
Section 2.5(a); and (ii) if such conditions have not been
satisfied, the Agent shall notify the applicable Borrower.
(c) In the event of any request for a drawing under any
Letter of Credit by the beneficiary thereof, the Agent shall give
telephonic notice (promptly confirmed in writing) to the
applicable Borrower (x) confirming receipt of such request and
(y) of the date on or before which the Agent intends to honor
18
such drawing, and the applicable Borrower shall reimburse the
Agent on the day on which such drawing is honored in compliance
with the terms of the applicable Letter of Credit in an amount in
Dollars in same day funds equal to: (i) the amount of such
drawing if such drawing is in Dollars or (ii) the Dollar
Equivalent on the date of such drawing of the amount required to
be paid in the Alternative Currency pursuant to the terms of the
applicable Letter of Credit if such drawing is in an Alternative
Currency (the "Contract Amount"); PROVIDED that, and anything
contained in this Agreement to the contrary notwithstanding,
(A) unless the applicable Borrower shall have notified the Agent
prior to 11:00 a.m. (New York City local time) on the Banking Day
immediately before the date on or before which the Agent has
indicated that it intends to honor such drawing that the
applicable Borrower intends to reimburse the Agent for the amount
of such drawing with funds other than the proceeds of Variable
Rate Loans, such Borrower shall be deemed to have timely given a
notice of borrowing pursuant to Section 2.7 requesting the Banks
to make Variable Rate Loans on the date on which such drawing is
honored in an amount equal to (x) the amount of such drawing if
such drawing is denominated in Dollars or (y) the Contract Amount
if such drawing is not denominated in Dollars, and (B) subsequent
to satisfaction or waiver of the conditions specified in
Article 4, the Banks shall make Variable Rate Loans on the date
on which such drawing is honored, the proceeds of which shall be
applied directly to reimburse the Agent for the amount of such
drawing; and PROVIDED further that if, for any reason, the Agent
does not receive proceeds of Variable Rate Loans on the date on
which such drawing is honored in an amount equal to the amount of
such drawing (or the Contract Amount for any drawing not
denominated in Dollars), the applicable Borrower shall reimburse
the Agent on the Banking Day immediately following the date of
such drawing, in an amount in Dollars in same day funds equal to
the excess of the amount of such drawing (or the Contract Amount
for any drawing not denominated in Dollars) over the proceeds of
such Variable Rate Loans, if any, which are so received, plus
accrued interest on such excess amount at the rate set forth in
Section 2.5(e)(i)(A).
(d) If a Borrower shall fail to reimburse the Agent as
provided in Section 2.5(c) in an amount equal to the amount of
any drawing under a Letter of Credit issued by the Agent and
honored by the Agent in compliance with the terms of such Letter
of Credit and for any reason Variable Rate Loans are not advanced
to the applicable Borrower as contemplated by Section 2.5(c), the
Agent shall promptly notify each Bank of the unreimbursed amount
of such drawing and of such Bank's PRO RATA participation
therein. Each Bank shall make available to the Agent an amount
equal to its PRO RATA participation in same day funds, at the
office of the Agent specified in such notice, immediately upon
demand of the Agent. If any Bank fails to make available to the
Agent the amount of such Bank's PRO RATA participation in such
19
Letter of Credit as provided in this Section 2.5(d), the Agent
shall be entitled to recover such amount on demand from such Bank
together with interest (i) at the customary rate set by the Agent
for the correction of errors among banks for three (3) Banking
Days and (ii) thereafter at the Variable Rate. The Agent shall
distribute to each Bank which has paid all amounts payable by it
under this Section 2.5(d) with respect to any Letter of Credit
issued by the Agent such Bank's PRO RATA share of all payments
received by the Agent from the applicable Borrower in
reimbursement of drawings honored by the Agent under such Letter
of Credit when such payments are received.
(e)(i) Each Borrower agrees to pay the following amount to
the Agent with respect to Letters of Credit issued by the Agent
for the account of such Borrower:
(A) with respect to drawings made under any
Letter of Credit, interest, payable on demand, on the
amount paid by the Agent in respect of each such drawing
made in compliance with the terms of such Letter of Credit
from the date of the drawing through the date such amount is
reimbursed by a Borrower (including, if any, any such
reimbursement out of the proceeds of Variable Rate Loans
pursuant to Section 2.5(c) at a rate per annum equal to the
Variable Rate; PROVIDED that if a Default or Event of
Default shall exist and such Borrower is not, by reason
thereof, eligible to borrow Variable Rate Loans, then
interest shall accrue on such amount paid by the Agent at
the Default Rate.
(B) with respect to the issuance, amendment or
transfer of each Letter of Credit and each drawing made
thereunder, the Agent's standard documentary and processing
charges as in effect on the date of such issuance, amendment
or transfer.
(ii) Each Borrower agrees to pay the Agent for
distribution to each Bank in respect of all Letters of Credit
outstanding issued for such Borrower's account such Bank's PRO
RATA share of a commission equal to 1% per annum of the maximum
amount available from time to time to be drawn under such
outstanding Letter of Credit, based on the actual number of days
in the quarter that such amount was available to be drawn and the
actual number of days in the quarter, payable quarterly in
arrears on the last day of each fiscal quarter of the Company
commencing on the last day of the fiscal quarter of the Company
during which such letter of credit is issued and terminating on
the last day of the last fiscal quarter of the Company during
which such Letter of Credit is outstanding. The Agent shall
promptly pay to the Banks such amounts received by the Agent for
the account of the Banks in accordance with the Banks' PRO RATA
participation. If any Letter of Credit is fully drawn upon or
20
otherwise terminated, each Bank agrees to refund to the
applicable Borrower such Bank's share of any letter of credit
fees paid in advance by such Borrower hereunder for the amount so
drawn or terminated on any such Letter of Credit and with respect
to any period (determined on a PRO RATA basis for actual days
elapsed) from and after the date on which such Letter of Credit
is so drawn upon or otherwise terminated. Any refund owing by a
Bank to a Borrower pursuant to the preceding sentence may be
effected by a reduction in the amount of any letter of credit
fees next payable by such Borrower to such Bank, PROVIDED that if
no further letter of credit fees shall become payable hereunder
against which such refund can be credited, then such Bank shall
promptly pay the amount of such refund directly to such Borrower.
(f) The obligations of each Borrower to reimburse the Agent
for drawings made under the Letters of Credit issued by the Agent
for such Borrower and the obligations of the Banks under
Section 2.5(d) shall be unconditional and irrevocable and shall
be paid strictly in accordance with the terms of this Agreement
under all circumstances and irrespective of any setoff,
counterclaim or defense to payment which a Borrower may have or
have had against the Agent, including any defense based upon the
failure of any drawing under any Letter of Credit to comply
strictly with the terms and conditions of such Letter of Credit;
PROVIDED, HOWEVER, that neither a Borrower nor any Bank shall be
obligated to reimburse the Agent for any wrongful payment made by
the Agent under a Letter of Credit as a result of acts or
omissions constituting gross negligence or willful misconduct on
the part of the Agent.
(g) The face amount of each Letter of Credit shall not be
less than an amount agreed upon between the Agent and the
Borrower from time to time.
(h) In the event of any conflict between the terms of any
application and agreement for a letter of credit hereunder and
the terms of this Agreement, the terms of this Agreement shall
control.
Section 2.6. PURPOSE. The Borrowers shall use the proceeds
of the Term Loan and the Revolving Loans for the purchase of the
Hercules Division pursuant to the Purchase Agreement, the
repayment of the amounts outstanding under the Existing Credit
Facility, working capital, future capital expenditures and for
general corporate purposes of the Borrowers, and the proceeds of
Swingline Loans for working capital purposes. Such proceeds
shall not be used for the purpose, whether immediate, incidental
or ultimate, of buying or carrying "margin stock" in violation of
Regulation U.
Section 2.7. BORROWING PROCEDURES. The applicable Borrower
shall give the Agent notice (a "Borrowing Request") of each
21
Borrowing to be made under Section 2.1 or Section 2.2 as provided
in Section 2.11. Not later than 2:00 p.m. New York City local
time on the date of such Borrowing pursuant to Section 2.1, each
Bank shall, through its Lending Office and subject to the
conditions of this Agreement, make available to the Agent, at the
Principal Office for the account of the Lending Office designated
by the Agent, the amount of the Loan to be made by such Bank on
such day in the currency in which such Loan is to be made and in
immediately available funds for the account of the applicable
Borrower. The amount so received by the Agent shall, subject to
the conditions of this Agreement, be made available to the
applicable Borrower, in immediately available funds, by the Agent
crediting an account of such Borrower designated by such Borrower
and maintained by such Borrower with the Agent at the Principal
Office.
Section 2.8. PAYMENTS, PREPAYMENTS AND CONVERSIONS. (a)
Subject to the terms of this Agreement the Borrowers shall have
the right to make prepayments of principal, or to convert one
type of Loan into another type of Loan, at any time or from time
to time; PROVIDED that: (i) the applicable Borrower shall give
the Agent notice of each such prepayment or conversion as
provided in Section 2.11; (ii) each Eurocurrency Loan may be
prepaid or converted only on the last day of the applicable
Interest Period for such Loan, and (iii) each prepayment shall be
in a minimum principal amount of $1,000,000. Each prepayment of
the Term Loans shall be applied to installments of the Term Loans
PRO RATA in accordance with the respective amounts thereof,
PROVIDED that the Borrowers may prepay up to the next succeeding
two (2) quarterly installments of principal on the Term Loan at
any time, and from time to time, upon notice to the Agent as
provided in Section 2.11.
(b) If at any time the amount of the Revolving Loans
outstanding hereunder plus the Letters of Credit Usage plus the
amount of the Swingline Loans exceeds the aggregate amount of the
Commitments, the Borrowers shall immediately repay the Revolving
Loans in an amount equal to such excess. For the purposes of
this Section 2.8(b) the amount outstanding under any Alternative
Currency Loan at any time shall be the Dollar Equivalent thereof
as of the Denomination Date.
(c) The principal balance of the Term Loans shall be repaid
in quarterly installments, due on the last day of each March,
June, September and December commencing with March 31, 1996, in
the following amounts:
March 31, 1996 - December 31, 1997: $1,517,857
March 31, 1998 - December 31, 2000: $3,035,714
March 31, 2001 - Maturity Date: $4,553,571,
22
with a final payment of all outstanding principal and accrued
interest to be made on the Maturity Date.
Section 2.9. INTEREST PERIODS; RENEWALS. (a) In the case
of each Eurocurrency Loan, the applicable Borrower shall select
an Interest Period of a duration specified in the definition of
Interest Period in Section 1.1, subject to the following
limitations: (i) no Interest Period may extend beyond the
Termination Date in the case of Revolving Loans and Swingline
Loans, or Maturity Date in the case of Term Loans; (ii)
notwithstanding Section 2.9(a)(i), no Interest Period shall have
a duration less than one month, and if any such proposed Interest
Period would otherwise be for a shorter period, such Interest
Period shall not be available; (iii) if an Interest Period would
end on a day which is not a Banking Day, such Interest Period
shall be extended to the next Banking Day, unless such Banking
Day would fall in the next calendar month in which event such
Interest Period shall end on the immediately preceding Banking
Day; and (iv) only seven Interest Periods of each Bank may be
outstanding at any one time.
(b) Upon notice to the Agent as provided in Section 2.11
and PROVIDED no Default or Event of Default has occurred and is
continuing, on the last day of the Interest Period therefor a
Borrower may (i) renew any Eurocurrency Loan as the same type of
Loan with an Interest Period of the same or different duration in
accordance with the limitations set forth in Section 2.9(a) or
(ii) convert such Loan to a Variable Rate Loan. If a Borrower
shall fail to give notice to the Agent of such a renewal or by
the terms of this Agreement shall not be permitted to renew a
Eurocurrency Loan, (A) in the case of a Eurocurrency Loan
denominated in Dollars, on the last day of the current Interest
Period such Eurocurrency Loan shall automatically become a
Variable Rate Loan and (B) in the case of a Eurocurrency Loan
denominated in an Alternative Currency, on the last day of the
current Interest Period such Eurocurrency Loan shall
automatically become a Eurocurrency Loan denominated in the same
Alternative Currency having an Interest Period of one month.
Section 2.10. CHANGES OF COMMITMENTS. The Company shall
have the right to reduce or terminate the amount of unused
Commitments or the Swingline Commitment at any time or from time
to time, PROVIDED that: (a) the Company shall give notice of
each such reduction or termination to the Agent and the Swingline
Lender as provided in Section 2.11; and (b) each partial
reduction shall be in an aggregate amount at least equal to
$1,000,000; PROVIDED that if any such reduction would cause the
aggregate Commitments to be reduced below the amount of
$5,000,000, the Banks shall have the right either to reduce the
Commitments to such amount or to terminate the Commitments in
whole. The Commitments once reduced or terminated may not be
reinstated.
23
Section 2.11. CERTAIN NOTICES. Borrowing Requests issued
by a Borrower to the Agent with respect to each Borrowing
pursuant to Section 2.7, each notice of prepayment or conversion
pursuant to Section 2.8, each notice of renewal pursuant to
Section 2.9(b), and each notice of reduction or termination of
the Commitments pursuant to Section 2.10 shall be irrevocable and
shall be effective only if received by the Agent not later than
11:00 a.m. New York City local time, and (a) in the case of
Borrowings and prepayments of, conversions into and renewals of
(i) Variable Rate Loans, given on or before the day of such
Borrowing; or (ii) Eurocurrency Loans, given at least three
Banking Days prior thereto; (b) in the case of reductions or
termination of the Commitments, given at least three Banking Days
prior thereto. Each such notice shall specify the Loans to be
borrowed, prepaid, converted or renewed and the currency, the
amount and type of the Loans to be borrowed, prepaid, converted
or renewed (and, in the case of a conversion, the type of Loans
to result from such conversion and, in the case of a Eurocurrency
Loan, the Interest Period therefor) and the date of the
Borrowing, prepayment, conversion or renewal (which shall be a
Banking Day). Each such notice of reduction or termination shall
specify the amount of the Commitments to be reduced or
terminated. The Agent shall promptly notify the Banks of the
contents of each such notice.
Section 2.12. MINIMUM AMOUNTS. Except for Borrowings which
exhaust the full remaining amount of the Commitments, prepayments
or conversions which result in the prepayment or conversion of
all Loans of a particular type or conversions made pursuant to
Section 3.4, each Borrowing, prepayment, conversion and renewal
of principal of Revolving Loans of a particular type shall be,
(a) in the case of a Variable Rate Loan in an amount at least
equal to $500,000 (or the Dollar Equivalent of $500,000) in the
aggregate for all Banks, and (b) in the case of Eurocurrency
Loans in an amount equal to $2,000,000 or any larger integral
multiple of $100,000 (or the Dollar Equivalent of $2,000,000 or
any integral multiple of $100,000 in excess thereof) in the
aggregate for all Banks. Each Borrowing, prepayment, conversion,
and renewal of principal of Swingline Loans shall be in an amount
at least equal to $1,000,000 (or the Dollar Equivalent of
$1,000,000), except in the case of prepayments when the
outstanding principal balance of the Swingline Loans is less than
$1,000,000; PROVIDED that in such case any prepayment shall be in
an amount equal to such outstanding principal balance.
Borrowings, prepayments, conversions or renewals of or into Loans
of different types or, in the case of Eurocurrency Loans, having
different Interest Periods at the same time hereunder shall be
deemed separate Borrowings, prepayments, conversions and renewals
for the purposes of the foregoing minimum amounts, one for each
type or Interest Period.
Section 2.13. INTEREST. (a) Interest shall accrue on the
24
outstanding and unpaid principal amount of each Loan for the
period from and including the date of such Loan to but excluding
the date such Loan is due, at the following rates per annum: (i)
for a Variable Rate Loan, at a variable rate per annum equal to
the Variable Rate PLUS the applicable Interest Margin; and (ii)
for a Eurocurrency Loan, at a fixed rate equal to the Fixed Rate
PLUS the applicable Interest Margin. If any principal amount
shall not be paid when due (at stated maturity, by acceleration
or otherwise), interest shall accrue on such amount from and
including such due date to but excluding the date such amount is
finally paid in full at the Default Rate.
(b The interest rate on each Variable Rate Loan shall
change when the Variable Rate changes, without notice of demand
of any kind, effective as of the opening of business on the
calendar day on which such change in the Variable Rate becomes
effective. Interest on the Loans shall be calculated on the
basis of a year of 365/366 days and the actual number of days
elapsed. Promptly after the determination of any interest rate
provided for herein or any change therein, the Agent shall notify
the Borrower and the Banks.
(c) Accrued interest shall be due and payable in arrears
upon any repayment or prepayment of principal on or conversion of
any Loan and (i) for each Variable Rate Loan, on the last day of
each March, June, September and December, in arrears, commencing
the first such date after such Loan and (ii) for each
Eurocurrency Loan, in arrears on the last day of the applicable
Interest Period (unless a six month interest period is chosen in
which case interest will be payable in arrears ninety days from
the date of the Loan and on the last day of the Interest Period);
PROVIDED that interest accruing at the Default Rate shall be due
and payable from time to time on demand of the Agent.
Section 2.14. FEES. (a) The Company shall pay to the Agent
for the account of each Bank a commitment fee on the daily
average unused Commitment of such Bank (it being understood that
outstanding Swingline Loans, if any, shall not be taken into
account when calculating the unused Commitment of any Bank) for
the period from and including the Closing Date to the date the
Commitments are terminated at the applicable rate per annum
specified in EXHIBIT J, based on the ratio of Debt of the Company
and its Consolidated Subsidiaries on a consolidated basis to
Consolidated EBITDA minus Consolidated Capital Expenditures,
calculated on the basis of a year of 365/366 days for the actual
number of days elapsed. The accrued commitment fee shall be due
and payable in arrears upon any reduction or termination of the
Commitments, on the last day of each March, June, September and
December, commencing on March 31, 1996 and on the Termination
Date.
(b) The Company shall pay to the Agent as compensation for
25
its services hereunder an agency fee and an arrangement fee as
set forth in that certain letter dated December 5, 1995 between
the Agent and the Company.
Section 2.15. PAYMENTS GENERALLY. All payments under this
Agreement or the Notes shall be made in immediately available
funds. In the case of Loans denominated in Dollars, payment
shall be made in Dollars on the relevant payment date not later
than 1:00 p.m. New York City local time at the Principal Office
for the account of the applicable Lending Office of each Bank.
In the case of Loans denominated in an Alternative Currency,
payment shall be made in such Alternative Currency on the
relevant payment date not later than 1:00 p.m. New York City
local time at the Principal Office for the account of the Lending
Office designated by the Agent for the account of the applicable
Lending Office of each Bank. Each such payment made after such
time on such due date shall be deemed to have been made on the
next succeeding Banking Day. The Agent, or any Bank for whose
account any such payment is to be made, may (but shall not be
obligated to) debit the amount of any such payment which is not
made by such time to any ordinary deposit account of the Borrower
with the Agent or such Bank, as the case may be, and any Bank
that makes such a debit shall promptly notify the Agent and the
Company. Each Borrower shall, at the time of making each payment
under this Agreement or any Note, specify to the Agent the
principal or other amount payable by such Borrower under this
Agreement or the Notes to which such payment is to be applied
(and if a Borrower fails so to specify, or if a Default or Event
of Default has occurred and is continuing, the Agent may apply
such payment as the Agent may elect in its sole discretion
(subject to Section 10.16(c)). If the due date of any payment
under this Agreement or any Note would otherwise fall on a day
which is not a Banking Day, such date shall be extended to the
next succeeding Banking Day and interest shall be payable for any
principal so extended for the period of such extension. Each
payment received by the Agent hereunder or under any Note for the
account of a Bank shall be paid promptly by the Agent to such
Bank, in immediately available funds, for the account of such
Bank's Lending Office.
ARTICLE 3. YIELD PROTECTION; ILLEGALITY; ETC.
Section 3.1. ADDITIONAL COSTS. (a) The Company shall pay
directly to each Bank from time to time on demand such amounts as
such Bank may determine to be necessary to compensate it for any
costs which such Bank determines are attributable to its making
or maintaining any Eurocurrency Loan or Eurocurrency Loans under
this Agreement or its Notes or its obligation to make any such
Loan or Loans hereunder, or any reduction in any amount
receivable by such Bank hereunder in respect of any such Loan or
Loans or such obligation (such increases in costs and reductions
26
in amounts receivable being herein called "Additional Costs"),
resulting from any Regulatory Change which: (i) changes the
basis of taxation of any amounts payable to such Bank under this
Agreement or its Notes in respect of any of such Loans (other
than taxes imposed on the overall net income of such Bank or of
its Lending Office for any of such Loans by the jurisdiction in
which such Bank has its principal office or such Lending Office);
(ii) imposes or modifies any reserve, special deposit, deposit
insurance or assessment, minimum capital, capital ratio or
similar requirement relating to any extensions of credit or other
assets of, or any deposits with or other liabilities of, such
Bank (including any of such Loans or any deposits referred to in
the definition of "Fixed Base Rate" in Section 1.1); or (iii)
imposes any other condition affecting this Agreement or its Notes
(or any of such extensions of credit or liabilities). Each Bank
will notify the Company of any event occurring after the date of
this Agreement which will entitle such Bank to compensation
pursuant to this Section 3.1(a) as promptly as practicable after
such Bank obtains knowledge thereof and determines to request
such compensation. Such notice will set forth in reasonable
detail the calculation of any Additional Costs due hereunder. If
any Bank requests compensation from the Company under this
Section 3.1(a), or under Section 3.1(c), the Company may, by
notice to such Bank (with a copy to the Agent), require that such
Bank's Loans of the type with respect to which such compensation
is requested be converted in accordance with Section 3.4.
(b) Without limiting the effect of the foregoing provisions
of this Section 3.1, if, by reason of any Regulatory Change, any
Bank either (i) incurs Additional Costs based on or measured by
the excess above a specified level of the amount of a category of
deposits or other liabilities of such Bank which includes
deposits by reference to which the interest rate on Eurocurrency
Loans is determined as provided in this Agreement or a category
of extensions of credit or other assets of such Bank which
includes Eurocurrency Loans or (ii) becomes subject to
restrictions on the amount of such a category of liabilities or
assets which it may hold, then, if such Bank so elects by notice
to the Company (with a copy to the Agent), the obligation of such
Bank to make or renew, and to convert Loans of any other type
into, Loans of such type hereunder shall be suspended until the
date such Regulatory Change ceases to be in effect, and all Loans
of such type held by such Bank then outstanding shall be
converted in accordance with Section 3.4.
(c) Without limiting the effect of the foregoing provisions
of this Section 3.1 (but without duplication), the Company shall
pay directly to each Bank from time to time on demand such
amounts as such Bank may determine to be necessary to compensate
such Bank for any costs which such Bank determines are
attributable to the maintenance by it, pursuant to any law or
regulation of any jurisdiction or any interpretation, directive
27
or request (whether or not having the force of law and whether in
effect on the date of this Agreement or thereafter) of any court
of governmental or monetary authority, of capital in respect of
its Loans hereunder or its obligation to make Loans hereunder
(such compensation to include an amount equal to any reduction in
return on assets or equity of such Bank to a level below that
which it could have achieved but for such law, regulation,
interpretation, directive or request). Each Bank will notify the
Agent if such Bank is entitled to compensation pursuant to this
Section 3.1(c) as promptly as practicable after such Bank it
determines to request such compensation, and the Agent will
notify the Company. Such notice will set forth in reasonable
detail the calculation of any amounts due hereunder.
(d) Determinations and allocations by a Bank for purposes
of this Section 3.1 of the effect of any Regulatory Change
pursuant to Sections 3.1(a) or 3.1(b), or of the effect of
capital maintained pursuant to Section 3.1(c), on its costs of
making or maintaining Loans or its obligation to make Loans, or
on amounts receivable by, or the rate of return to, such Bank in
respect of Loans or such obligation, and of the additional
amounts required to compensate such Bank under this Section 3.1,
shall be conclusive, PROVIDED that such determinations and
allocations are made on a reasonable basis.
Section 3.2. LIMITATION OF TYPES OF LOANS. Notwithstanding
any other provision in this Agreement, if:
(a) the Agent determines (which determination shall be
conclusive) that quotations of interest rates for the
relevant deposits referred to in the definition of "Fixed
Base Rate" in Section 1.1 are not being provided in the
relevant amounts or for the relevant maturities for purposes
of determining the rate of interest for any type of
Eurocurrency Loans as provided in this Agreement; or
(b) the Required Banks determine (which determination shall
be conclusive) and notify the Agent that the relevant rates
of interest referred to in the definition of "Fixed Base
Rate" in Section 1.1 upon the basis of which the rate of
interest for any type of Eurocurrency Loans is to be
determined do not adequately cover the cost to the Banks of
making or maintaining such Loans;
then the Agent shall give the applicable Borrowers and each Bank
prompt notice thereof, and so long as such condition remains in
effect, the Banks shall be under no obligation to make or renew
Loans of such type or to convert Loans of any other type into
Loans of such type, and each Borrower shall, on the last day(s)
of the then current Interest Period(s) for the outstanding Loans
of the affected type, either prepay such Loans or convert such
Loans into another type of Loans in accordance with Section 2.8.
28
Section 3.3. ILLEGALITY. Notwithstanding any other
provision in this Agreement, if it becomes unlawful for any Bank
or its Lending Office to (a) honor its obligation or make or
renew Eurocurrency Loans hereunder or convert Loans of any type
into Eurocurrency Loans, (b) maintain Eurocurrency Loans
hereunder or (c) in the case of a Borrowing denominated in an
Alternative Currency, there shall have occurred a change in (i)
national or international financial, political or economic
conditions (including the imposition of or any change in exchange
controls) or (ii) any currency exchange rate which would make it
impracticable for any Bank to make Loans denominated in such
Alternative Currency, then such Bank shall promptly notify the
Company thereof (with a copy to the Agent), and such Bank's
obligation to make or renew Eurocurrency Loans and to convert
other types of Loans into Eurocurrency Loans or to make Loans
denominated in such Alternative Currency hereunder shall be
suspended until such time as such Bank may again make, renew, or
convert and maintain such affected Loans and such Bank's
outstanding Eurocurrency Loans or Alternative Currency Loans, as
the case may be, shall be converted in accordance with
Section 3.4.
Section 3.4. CERTAIN CONVERSIONS PURSUANT TO SECTIONS 3.1
AND 3.3. If the Loans of any Bank of a particular type (Loans of
such type being herein called "Affected Type" or "Affected
Loans") are to be converted pursuant to Section 3.1 or 3.3, such
Bank's Affected Loans shall be automatically converted into
Variable Rate Loans (and in the case of Loans denominated in an
Alternative Currency, to Variable Rate Loans denominated in
Dollars in the Dollar Equivalent amount) on the last day(s) of
the then current Interest Period(s) for the Affected Loans or, in
the case of a conversion required by Section 3.1(b) or 3.3, on
such earlier date as such Bank may specify to the Company with a
copy to the Agent) and, unless and until such Bank gives notice
as provided below that the circumstances specified in Section 3.1
or 3.3 which gave rise to such conversion no longer exist:
(a) to the extent that such Bank's Affected Loans have been
converted into Variable Rate Loans, all payments and
prepayments of principal which would otherwise be applied to
such Bank's Affected Loans shall be applied instead to its
Variable Rate Loans; and
(b) all Loans which would otherwise be made or renewed by
such Bank as Loans of the Affected Type shall be made
instead as Variable Rate Loans and all Loans of such Bank
which would otherwise be converted into Loans of the
Affected Type shall be converted instead into (or shall
remain as) Variable Rate Loans; and
(c) if Loans of other Banks of the Affected Type are
subsequently converted into Loans of another type (other
29
than Variable Rate Loans), such Bank's Variable Rate Loans
shall be automatically converted on the conversion date into
Loans of such other type to the extent necessary so that,
after giving effect thereto, all Loans held by such Bank and
the Banks whose Loans are so converted are held PRO RATA (as
to principal amounts, types and Interest Periods) in
accordance with their respective Commitments.
If such Bank gives notice to the Company (with a copy to the
Agent) that the circumstances specified in Section 3.1 or 3.3
which gave rise to the conversion of such Bank's Affected Loans
pursuant to this Section 3.4 no longer exist (which such Bank
agrees to do promptly upon such circumstances ceasing to exist)
at a time when Loans of the Affected Type are outstanding, such
Bank's Variable Rate Loans shall be automatically converted, on
the first day(s) of the next succeeding Interest Period(s) for
such outstanding Loans of the Affected Type to the extent
necessary so that, after giving effect thereto, all Loans held by
the Banks holding Loans of the Affected Type and by such Bank are
held PRO RATA (as to principal amounts, types and Interest
Periods) in accordance with their respective Commitments.
Section 3.5. CERTAIN COMPENSATION. The Company shall pay
to the Agent for the account of each Bank, upon the request of
such Bank through the Agent, such amount or amounts as shall be
sufficient (in the reasonable opinion of such Bank) to compensate
it for any loss, cost or expense which such Bank determines is
attributable to:
(a) any payment, prepayment, conversion or renewal of a
Eurocurrency Loan made by such Bank on a date other than the
last day of an Interest Period for such Loan (whether by
reason of acceleration or otherwise); or
(b) any failure by the Borrower to borrow, convert into or
renew a Eurocurrency Loan to be made, converted into or
renewed by such Bank on the date specified therefor in the
relevant notice under Section 2.7, 2.8 or 2.9, as the case
may be.
Without limiting the foregoing provisions of this Section 3.5,
such compensation shall include any losses (including loss of
anticipated profits), costs or expenses arising from converting
Loans denominated in an Alternative Currency to the Dollar
Equivalent on the day of payment, prepayment, conversion or
renewal or incurred by reason of liquidation or reemployment of
deposits or other funds acquired by any Bank to fund or maintain
any prepaid principal amount at the yield being earned prior to
such prepayment. A determination by any Bank as to the amounts
payable pursuant to this Section 3.5 shall be conclusive absent
manifest error.
30
Section 3.6. INDEMNIFICATION FOR TAXES. (a) All payments
hereunder and under any of the Facility Documents (including
payments on account of principal and interest and fees) shall be
made by the Borrowers without deduction or withholding for or on
account of any present or future tax, duty, levy, impost,
assessment or other governmental charge imposed by any
jurisdiction ("Taxes"). If a Borrower is required by law to make
any deduction or withholding of any Taxes from any payment due
hereunder or under any of the Facility Documents, then the amount
payable will be increased to such amount which, after deduction
from such increased amount of all Taxes required to be withheld
or deducted therefrom, will not be less than the amount due and
payable hereunder had no such deduction or withholding been
required. Notwithstanding the foregoing, Taxes shall not
include, and no such additional amounts shall be payable in
respect of:
(i) any tax imposed on the overall net income of the
Lending Office of any Bank in respect of which the relevant
payment is made to the jurisdiction in which such Bank is
organized, in which such Bank's Lending Office is located or
in which such Bank is managed and controlled; or
(ii) any such deduction or withholding which would not
have been required to be so deducted or withheld if the Bank
to which such payment was made had at the date of payment
been either:
(A) a Bank carrying on a bona fide banking
business in the United Kingdom recognized by the Inland
Revenue Service and bringing the interest payable
hereunder into account as a trading receipt of such
business; or
(B) resident in a country with which the United
Kingdom has an appropriate Double Taxation Treaty
giving exemption from United Kingdom taxation on
interest and had any necessary application thereunder
been made
(except that this Section 3.6(a)(ii) shall not operate to
prevent a Bank receiving such additional amounts to the
extent that such amounts become payable solely as a result
of any revocation or repeal of, or any change in, or any
published change in the interpretation or application of,
any relevant law or the practice of the Inland Revenue
Service or the provisions of a double taxation treaty since
the date of this Agreement).
(b) If any additional amounts shall become payable pursuant
to Section 3.6(a), the applicable Borrower and the Bank concerned
will discuss in good faith with a view to determining whether any
31
means (not being detrimental in the opinion of such Bank to any
of such Bank's interests) exist or may be implemented by which
such amounts may lawfully be mitigated or reduced, (or such Bank
be compensated in some other way) so as to leave such Bank in the
same position in which such Bank would have been had such Taxes
not been payable.
(c) If any Borrower makes any payment hereunder in respect
of which such Borrower is required by law to make any deduction
or withholding of any Taxes, such Borrower shall pay the full
amount to be deducted or withheld to the relevant taxation or
other authority within the time allowed for such payment under
applicable law and shall deliver to the Banks as soon as
practicable after it has made such payment to the applicable
authority a receipt issued by such authority or a statement of
the Borrower confirming the payment to such authority of all
amounts so required to be deducted or withheld from such payment.
(d) Without prejudice to the provisions of Section3.6(a),
if any Bank, or the Agent on its behalf, is required by law to
make any payment on account of Taxes (other than those referred
to in Section 3.6(a)(i) above) on or in relation to any sum
received or receivable hereunder or under any of the Facility
Documents by such Bank, or the Agent on its behalf, or any
liability for such Taxes in respect of any such payment is
imposed, levied or assessed against any Bank, or the Agent on its
behalf, the Borrowers will promptly indemnify such person against
such Tax payment or liability, together with any interest,
penalties and expenses (including counsel fees and expenses)
payable or incurred in connection therewith, including any such
Tax on any Bank arising by virtue of payments under this
Section 3.6(d), computed in a manner consistent with
Section 3.6(a). A certificate as to the amount of such payment
by such Bank, or the Agent on its behalf, absent manifest error,
shall be final, conclusive and binding for all purposes.
Section 3.7. PARTIAL DEFEASANCE. If the Company shall
become obligated to make any payment to any Bank under this
Article 3 or any Bank shall be excused from performing by the
provisions of Article 3, then the Company shall have the right,
on giving to the Agent and such Bank not less than thirty (30)
days prior written notice, to prepay in full, without penalty or
premium, the outstanding principal amount of the Loans held by
such Bank, together with interest accrued thereon to the date of
such prepayment. Such prepayment shall terminate the Commitment
of each Bank whose Loans are prepaid, and the other Banks shall
be under no obligation to increase their respective Commitments
to cover such terminated Commitment; provided that the other
Banks shall be deemed to have increased their pro-rata
participation (determined in accordance with their respective
Commitments) in outstanding Letters of Credit by the
participation amount previously held by each Bank whose Loans are
prepaid.
32
ARTICLE 4. CONDITIONS PRECEDENT
Section 4.1. INITIAL CONDITIONS PRECEDENT. The obligations
of the Banks to make the Loans pursuant to the initial Borrowing
Request, to advance the Term Loan on the Funding Date or to issue
a Letter of Credit on the Closing Date are subject to
satisfaction of the following conditions precedent on the Funding
Date:
(a) this Agreement in form and substance satisfactory to
the Agent and its counsel shall have been duly executed and
delivered to the Agent by the Company and MacDermid Imaging;
(b) the Notes shall have been duly executed and delivered
to the Agent by the applicable Borrowers;
(c) the Agent shall have received Certificates of duly
authorized officers of the Company and MacDermid Imaging
certifying that the following statements shall be true as of the
Funding Date:
(i) the representations and warranties contained in
Article 5, and in the case of a Borrowing by an
Eligible Subsidiary, Section 4.5, and the
representations and warranties made by the Guarantors
in Section of the Guaranty, are true and correct in all
material respects on and as of the date of such Loans
or the issuance of such Letter of Credit as though made
on and as of such date (unless they specifically
related to an earlier date); and
(ii) no Default or Event of Default has occurred and
is continuing, or would result from such Loans or the
issuance of such Letter of Credit; and
(d) an Authorization Letter in form and substance
satisfactory to the Agent and its counsel shall have been duly
executed and delivered to the Agent by each of the Company,
MacDermid Imaging and as applicable, any Eligible Subsidiary;
(e) the Guaranty, in form and substance satisfactory to the
Agent and its counsel shall have been duly executed and delivered
to the Agent by the Guarantors;
(f) all amounts outstanding under the Existing Credit
Facility shall have been repaid;
(g) a certificate of the Secretary or Assistant Secretary
of each of the Company and MacDermid Imaging, dated the Funding
Date, shall have been delivered to the Agent attesting to all
corporate action taken by the Company and MacDermid Imaging,
33
including resolutions adopted by their respective Boards of
Directors authorizing the execution, delivery and performance of
the Facility Documents and each other document to be delivered
pursuant to this Agreement and certifying the names and true
signatures of the officers of the Company and MacDermid Imaging,
authorized to sign the Facility Documents and the other documents
to be delivered by the Company and MacDermid Imaging, under this
Agreement;
(h) a certificate of a duly authorized officer of the
Company, dated the Funding Date, shall have been delivered to the
Agent setting forth the calculation of the ratio for the twelve-
month period ending September 30, 1995, of (i) the Debt of the
Company and its Consolidated Subsidiaries on a consolidated basis
adjusted to include the Debt of the Division during such period
as reflected in the Division's internally prepared financial
reports and the Debt incurred pursuant to this Agreement on the
Funding Date to (ii) Consolidated EBITDA adjusted to include the
earnings before interest, taxes, depreciation and amortization of
the Division for such period minus Consolidated Capital
Expenditures adjusted to include capital expenditures of the
Division during such period;
(i) a favorable opinion of counsel for the Company and
MacDermid Imaging dated the Funding Date, in substantially the
form of EXHIBIT E and as to such other matters as the Agent may
reasonably request shall have been delivered to the Agent;
(j) since September 30, 1995, there has been no material
adverse change in the business, financial position or results of
operations of the Hercules Division from that reflected in the
Monthly Management Report and no event shall have occurred (and
the Agent shall not have become aware of conditions) which the
Agent or any Bank reasonably determines could have a material
adverse effect on (i) the operations, assets or prospects of the
Company and the Hercules Division from those reflected in the
September 30, 1995 Monthly Management Report, taken as a whole,
or (ii) any Borrower's ability to meet its obligations under any
Facility Document;
(k) the Agent shall have received evidence satisfactory to
the Agent that each Borrower and Hercules is in compliance in all
material respects with all foreign and U.S. federal, state and
local laws (including laws relating to the environment);
(l) the Agent shall have received phase one and phase two
environmental assessments of the properties of the Hercules
Division which shall be satisfactory to the Agent in its sole
discretion;
(m) MacDermid Imaging shall have received a credit at
closing (subject to subsequent adjustment as contemplated by the
34
Purchase Agreement) of not less than $30,000,000 against the
purchase price paid to Hercules Inc. pursuant to the Purchase
Agreement from the issuance of its preferred stock, and the terms
and conditions of such preferred stock shall be satisfactory to
the Agent in its sole discretion;
(n) the transactions contemplated by the Purchase Agreement
shall have been consummated;
(o) the audited financial statements of the Company and its
Consolidated Subsidiaries for the fiscal year ending March 31,
1995 shall have been delivered to the Agent;
(p) the Agent shall have received a Consent and
Acknowledgement Agreement relating to the Preferred Stock in form
and substance satisfactory to the Agent from Hercules
Incorporated agreed to by the Company and MacDermid Imaging;
(q) the Agent shall have received audited financial
statements for the Hercules Division as of December 31, 1994,
December 31, 1993, and December 31, 1992; and
(r) the Agent shall have received such other certificates,
opinions and information as the Agent shall reasonably request.
Section 4.2. SUBSEQUENT LOANS OR LETTERS OF CREDIT. The
obligations of the Banks to make Loans (other than renewals of
Eurocurrency Loans pursuant to Section 2.9) pursuant to any
subsequent Borrowing Request or to issue any Letter of Credit
after the Funding Date shall be subject to satisfaction of the
following conditions precedent:
(a) from and after the Closing Date no material adverse
change which would be reasonably likely to result in a Default or
an Event of Default shall have occurred in the business,
financial position or results of operation of the Company and its
Consolidated Subsidiaries, taken as a whole; and
(b) the statements in Section 4.1(c) shall be true and
correct as of such date.
Section 4.3. DEEMED REPRESENTATIONS. Each Borrowing
Request hereunder and each acceptance by the Company or any
Eligible Subsidiary of the proceeds of such Borrowing or
Borrowings and each request for issuance of a Letter of Credit
shall constitute a representation and warranty that the
statements contained in Section 4.2 are true and correct both on
the date of such notice and, unless the Borrower otherwise
notifies the Agent prior to such Borrowing, as of the date of
such Borrowing or issuance of a Letter of Credit.
Section 4.4. FIRST BORROWING BY EACH ELIGIBLE SUBSIDIARY.
35
The obligation of each Bank to make a Loan or issue a Letter of
Credit on the occasion of the first Borrowing Request or request
for issuance of a Letter of Credit by each Eligible Subsidiary is
subject to the satisfaction of the following further conditions:
(a) receipt by the Agent for the account of each Bank of a
duly executed Revolving Note of such Eligible Subsidiary dated on
or before the date of such Borrowing complying with the
provisions of Section 2.4;
(b) receipt by the Agent of an Authorization Letter duly
executed by the Eligible Subsidiary;
(c) receipt by the Agent of an Election to Participate duly
executed by the Eligible Subsidiary;
(d) receipt by the Agent of an opinion of counsel for such
Eligible Subsidiary acceptable to the Agent, substantially in the
form of EXHIBIT F and covering such additional matters relating
to the transactions contemplated hereby as the Required Banks may
reasonably request;
(e) receipt by the Agent of all documents which it may
reasonably request relating to the existence of such Eligible
Subsidiary, the corporate authority for and the validity of this
Agreement, the Authorization Letter, the Election to Participate
and the Notes of such Eligible Subsidiary, and any other matters
relevant thereto, all in form and substance satisfactory to the
Agent; and
(f) the representations and warranties contained in
Section 4.5 shall be true and correct on and as of the date of
such Borrowing as though made on and as of such date, and no
Default or Event of Default shall have occurred and be
continuing, or would result from such Loans.
The opinion referred to in Section 4.4(d) above shall be
dated no more than five Banking Days before the date of the first
Borrowing by such Eligible Subsidiary hereunder.
Section 4.5. REPRESENTAIONS OF ELIGIBLE SUBSIDIARIES. Each
Eligible Subsidiary shall be deemed by the execution and delivery
of its Election to Participate to have represented and warranted
as of the date thereof that:
(a) It is a corporation duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of
incorporation and is a Wholly-Owned Consolidated Subsidiary of
the Company.
(b) The execution and delivery by it of its Authorization
Letter, its Election to Participate and its Notes, and the
36
performance by it of this Agreement and its Notes: are within
its corporate powers; have been duly authorized by all necessary
corporate action; require no action by or in respect of, or
filing with, any governmental body, agency or official; do not
contravene, or constitute a default under, any provision of any
applicable law or regulation or of its certificate of
incorporation or by-laws or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the
Company or such Eligible Subsidiary; and will not result in the
creation or imposition of any Lien on any asset of the Company or
any of its Subsidiaries.
(c) This Agreement constitutes a legal, valid and binding
obligation of such Eligible Subsidiary, and its Notes, when
executed and delivered in accordance with this Agreement, will
constitute the legal, valid and binding obligation of such
Eligible Subsidiary, and each of this Agreement and its Notes is
enforceable against such Eligible Subsidiary in accordance with
its terms except to the extent that such enforcement may be
limited by applicable bankruptcy, insolvency or other similar
laws affecting creditors' rights generally.
(d) Except as disclosed in such Election to Participate,
there is no income, stamp or other tax of any country, or any
taxing authority thereof or therein, in the nature of withholding
or otherwise, which is imposed on any payment to be made by such
Eligible Subsidiary pursuant hereto or on any of its Notes, or is
imposed on or by virtue of the execution, delivery, performance
or enforcement of its Election to Participate or any of its
Notes.
ARTICLE 5. REPRESENTAIONS AND WARRANTIES
Each of the Company and MacDermid Imaging hereby represents
and warrants that:
Section 5.1. INCORPORATION, GOOD STANDING AND DUE
QUALIFICATION. Each of the Company, MacDermid Imaging and the
Company's Subsidiaries is duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
assets and to transact the business in which it is now engaged,
and is duly qualified as a foreign corporation and in good
standing under the laws of each other jurisdiction in which such
qualification is required except where failure to be so qualified
would not have a material adverse effect on the Company's
business as a whole or its properties, condition (financial or
otherwise) or operation.
Section 5.2. CORPORATE POWER AND AUTHORITY; NO CONFLICTS.
The execution, delivery and performance by each of the Company
37
and MacDermid Imaging of the Facility Documents to which it is a
party have been duly authorized by all necessary corporate action
and do not and will not: (a) require any consent or approval of
its stockholders; (b) contravene its charter or by-laws; (c)
violate any provision of, or require any filing (except for the
filing of this Agreement with the Securities and Exchange
Commission and the New York Stock Exchange), registration,
consent or approval under, any law, rule, regulation (including
Regulation U), order, writ, judgment, injunction, decree,
determination or award presently in effect having applicability
to the Company or any of its Subsidiaries or affiliates; (d)
result in a breach of, or constitute a default or require any
consent (except for those consents which have been obtained)
under, any indenture or loan or credit agreement or any other
agreement, lease or instrument to which any Borrower is a party
or by which it or its properties may be bound; (e) result in, or
require, the creation or imposition of any Lien upon or with
respect to any of the properties now owned or hereafter acquired
by the Company or any of its Subsidiaries; or (f) cause the
Company (or any Subsidiary or affiliate, as the case may be) to
be in default under any law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award or any such
indenture, agreement, lease or instrument.
Section 5.3. LEGALLY ENFORCEABLE AGREEMENTS. Each Facility
Document to which the Company or MacDermid Imaging is a party is,
or when delivered under this Agreement will be, a legal, valid
and binding obligation of the Company or MacDermid Imaging, as
applicable, enforceable against the Company or MacDermid Imaging,
as applicable, in accordance with its terms, except to the extent
that such enforcement may be limited by applicable bankruptcy,
insolvency and other similar laws affecting creditors' rights
generally.
Section 5.4. LITIGATION. Except as disclosed on SCHEDULE
III, there are no actions, suits or proceedings pending or, to
the knowledge of the Company or MacDermid Imaging, threatened,
against or affecting the Company or any of its Subsidiaries
before any court, governmental agency or arbitrator, which, in
any one case or in the aggregate, would have a reasonable
likelihood of having a material adverse effect on the financial
condition, operations, properties or business of the Company and
its Subsidiaries as taken as a whole or the ability of the
Company or MacDermid Imaging to perform its obligation under the
Facility Documents.
Section 5.5. FINANCIAL STATEMENTS; SEC FILINGS. The
consolidated balance sheet of the Company and its Consolidated
Subsidiaries as at March 31, 1995, and the related consolidated
statements of income and statements of cash flows and changes in
stockholders' equity of the Company and its Consolidated
Subsidiaries for the fiscal year then ended, and the accompanying
38
footnotes, together with the opinion thereon, of KPMG Peat
Marwick LLP, independent certified public accountants, a copy of
which has been furnished to the Agent, are complete and correct
and fairly present the financial condition of the Company and its
Consolidated Subsidiaries as at such date and the results of the
operations of the Company and its Consolidated Subsidiaries for
the periods covered by such statements, all in accordance with
generally accepted accounting principles. Since March 31, 1995,
there has been no material adverse change in the business,
financial position or results of operations of the Company and
its Subsidiaries. The Company has timely made all filings
required of it with the Securities and Exchange Commission and is
in material compliance with all securities laws applicable to it.
Section 5.6. TAXES. Each of the Company and its
Subsidiaries has filed all United States Federal income tax
returns and all other material tax returns required to be filed
and has paid all taxes, assessments and governmental charges and
levies shown thereon to be due, including interest and penalties,
except for those which are being contested in good faith and by
appropriate proceedings diligently conducted. The federal income
tax liability of the Company and its Subsidiaries has been
audited by the Internal Revenue Service and has been finally
determined and satisfied for all taxable years up to and
including the taxable year ended March 31, 1988. The charges,
accruals and reserves on the books of the Company and its
Subsidiaries with respect to taxes or other governmental charges
are adequate in the opinion of the Company.
Section 5.7. ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of
ERISA and the Code with respect to each Plan and is in compliance
in all material respects with the presently applicable provisions
of ERISA and the Code with respect to each Plan. No member of
the ERISA Group has (a) sought a waiver of the minimum funding
standard under Section 412 of the Code in respect of any Plan,
(b) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or
made any amendment to any Plan or Benefit Arrangement, which has
resulted or could result in the imposition of a Lien or the
posting of a bond or other security under ERISA or the Code or
(c) incurred any liability under Title IV of ERISA other than a
liability to the PBGC for premiums under Section 4007 of ERISA.
Section 5.8. SUBSIDIARIES AND OWNERSHIP OF STOCK.
SCHEDULE I is a complete and accurate list of Subsidiaries of the
Company as of the date hereof, showing the jurisdiction of
incorporation or organization of each Subsidiary and showing the
percentage of the Company's ownership of the outstanding capital
stock or other ownership interest of each such Subsidiary.
Except as set forth on SCHEDULE I, all of the outstanding capital
stock or other ownership interest of each such Subsidiary has
39
been validly issued, is fully paid and nonassessable and if owned
by the Company is free and clear of all Liens.
Section 5.9. CREDIT ARRANGEMENTS. As of the October 31,
1995, SCHEDULE II is a complete and correct list of all Debt of
the Company and its Subsidiaries outstanding pursuant to which
the Company or its Subsidiaries are or may be, in any manner,
directly or contingently, obligated in an amount equal to or
greater than $1,000,000 and all Liens existing securing Debt
outstanding. Except as set forth on SCHEDULE II, there has been
no material change in the amount of Debt outstanding of the
Company and its Subsidiaries since March 31, 1995.
Section 5.10. NO DEFAULTS ON OUTSTANDING JUDGMENTS OR
ORDERS. Each of the Company and its Subsidiaries has satisfied
all material judgments, and neither the Company nor any of its
Subsidiaries is in default with respect to any material judgment,
writ, injunction, decree, rule or regulation of any court,
arbitrator or federal, state, municipal or other governmental
authority, commission, board, bureau, agency or instrumentality,
domestic or foreign.
Section 5.11. GOVERNMENTAL REGULATION. Neither the Company
nor any of its Subsidiaries is a "holding company" or a "public
utility" within the meaning of the Public Utility Holding Company
Act of 1935, or an "investment company" or a company "controlled"
by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or an "investment advisor"
within the meaning of the Investment Advisors Act of 1940, as
amended.
Section 5.12. ENVIRONMENTAL MATTERS. Except as disclosed
in SCHEDULE V, each of the Company and its Subsidiaries is in
compliance with all applicable Environmental Laws, and neither
the Company nor any of its Subsidiaries has any fixed or
contingent liability under any Environmental Law applicable to
the business, operations or properties of the Company or any of
its Subsidiaries (for purposes of this Section 5.12 "liabilities"
shall include liabilities for any capital or operating
expenditures required for clean-up or closure of properties
presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with
environmental protection standards imposed by law or as a
condition of any license, permit or contract, any related
constraints on operating activities, including any losses or
expenses relating to periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of
operations conducted thereat, any costs or liabilities in
connection with off-site disposal of wastes or Hazardous
Substances, and any actual or potential liabilities to third
parties, including employees, and any related costs and
expenses), except in each case where the amount of the
40
liabilities associated with such noncompliance and the amount of
such fixed or contingent liabilities does not exceed in the
aggregate $5,000,000. For purposes of determining the liability
of the Company and its Subsidiaries with respect to any remedial
obligation imposed pursuant to the Comprehensive Environmental
Response Compensation and Liability Act, as amended, or other
similar laws, whether state or federal, the Company and the Banks
shall take account of the contribution obligations of other
potentially responsible parties associated with such remedial
obligation.
Section 5.13. MARGIN STOCK. As of the Closing Date, the
fair market value of all margin stock (as defined in Regulation
U, 12 CFR Section 221.2(h)) owned by the Company and its
Subsidiaries does not exceed $100,000 (not including any shares
of the Company's Common Stock held in the MacDermid, Incorporated
Employee Pension Plan, the MacDermid, Incorporated Employees
Profit Sharing Plan and the MacDermid, Incorporated Employee
Stock Ownership Plan and 530,648 shares of Common Stock held in
the Company's treasury as of the date hereof).
Section 5.14. FULL DISCLOSURE. All information heretofore
furnished by the Company or any of its Subsidiaries to the Agent
or any Bank for purposes of or in connection with this Agreement
or any transaction contemplated hereby is, and all such
information hereafter furnished by the Company to the Agent or
any Bank will be, true and accurate in all material respects on
the date as of which such information is stated or certified
(provided that the representation and warranty of the Company in
this Section 5.14, as it applies to information regarding the
Division furnished prior to the date hereof, is limited to the
extent of the representations and warranties of Hercules
Incorporated as to truth and accuracy contained in the Purchase
Agreement). The Company has disclosed to the Banks in writing
any and all facts, other than general economic conditions, which
materially and adversely affect or may affect (to the extent the
Company can now reasonably foresee) the business, operations or
financial condition of the Company and its Subsidiaries, taken as
a whole, or the ability of the Company or any of its Subsidiaries
to perform their respective obligations under this Agreement or
any Note.
ARTICLE 6. AFFIRMATIVE COVENANTS
So long as any of the Notes shall remain unpaid, any amounts
shall be owing hereunder by any Borrower, or any Bank shall have
any Commitment under this Agreement, the Company shall comply
with the following covenants:
Section 6.1. REPORTING REQUIREMENTS. The Company shall
furnish directly to the Agent:
41
(a) as soon as available and in any event within 90 days
after the end of each fiscal year of the Company, a consolidated
and consolidating balance sheet of the Company and its
Consolidated Subsidiaries as of the end of such fiscal year and
the related consolidated and consolidating statements of income
and consolidated statements of cash flows and changes in
stockholders' equity of the Company and its Consolidated
Subsidiaries for such fiscal year, all in reasonable detail and
stating in comparative form the respective consolidated and
consolidating figures for the corresponding date and period in
the prior fiscal year and (i) in the case of the consolidated
statements, all reported on in a manner acceptable to the
Securities and Exchange Commission by KPMG Peat Marwick LLP or
other independent public accountants of nationally recognized
standing, and (ii) in the case of consolidating statements, all
certified as to fairness of presentation, compliance with
generally accepted accounting principles and consistency by the
chief financial officer of the Company;
(b) as soon as available and in any event within 60 days
after the end of each of the first three quarters of each fiscal
year of the Company, a consolidated and consolidating balance
sheet of the Company and its Consolidated Subsidiaries as of the
end of such quarter and the related consolidated and
consolidating statements of income and consolidated statements of
cash flows and changes in stockholders' equity of the Company and
its Consolidated Subsidiaries for such quarter and for the period
commencing at the end of the previous fiscal year and ending with
the end of such quarter, all in reasonable detail and stating in
comparative form the respective consolidated figures for the
corresponding quarter and the corresponding year-to-date period
in the previous fiscal year, and certified by the chief financial
officer of the Company (subject to year end adjustments and the
omission of notes permitted by the applicable regulations of the
Securities and Exchange Commission to be excluded from quarterly
reports filed on Form 10-Q) as to fairness of presentation,
compliance with generally accepted accounting principles and
consistency;
(c) simultaneously with the delivery of each set of
financial statements referred to in Sections 6.1(a) and 6.1(b)
above, a certificate of the chief financial officer of the
Company (i) setting forth in reasonable detail the calculations
required to establish whether the Company was in compliance with
the requirements of Sections 7.1 through 7.4, inclusive, and
Sections 7.6, 8.1, 8.2 and 8.3 on the date of such financial
statements, (ii) certifying as to the ratio for the twelve-month
period then ending of the Debt of the Company and its
Consolidated Subsidiaries on a consolidated basis to its
Consolidated EBITDA minus Consolidated Capital Expenditures for
such period, and (iii) stating whether any Default or Event of
Default exists on the date of such certificate and, if any
42
Default or Event of Default then exists, setting forth the
details thereof and the action which the Company is taking or
proposes to take with respect thereto;
(d) within ten days after any officer of the Company
obtains knowledge of any Default, if such Default is then
continuing, a certificate of the chief financial officer of the
Company setting forth the details thereof and the action which
the Company is taking or proposes to take with respect thereto;
(e) promptly upon the mailing thereof to the shareholders
of the Company generally, copies of all financial statements,
reports and proxy statements so mailed;
(f) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and
reports on Forms 10-K, 10-Q and 8-K (or their equivalents) which
the Company shall file with the Securities and Exchange
Commission;
(g) if and when any member of the ERISA Group (i) gives or
is required to give notice to the PBGC of any "reportable event"
(as defined in Section 4043 of ERISA) with respect to any Plan
which might constitute grounds for a termination of such Plan
under Title IV of ERISA, or knows that the Plan administrator of
any Plan has given or is required to give notice of any such
reportable event to the PBGC, a copy of such notice; (ii)
receives notice of complete or partial withdrawal liability under
Title IV of ERISA or notice that any Multiemployer Plan is in
reorganization, is insolvent or has been terminated, a copy of
such notice; (iii) receives notice from the PBGC under Title IV
of ERISA of an intent to terminate, impose liability (other than
for premiums under Section 4007 of ERISA) in respect of, or
appoint a trustee to administer any Plan, a copy of such notice;
(iv) applies for a waiver of the minimum funding standard under
Section 412 of the Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of
ERISA, a copy of such notice and other information filed with the
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to
Section 4063 of ERISA, a copy of such notice; or (vii) fails to
make any payment or contribution to any Plan or Multiemployer
Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted
or could result in the imposition of a Lien or the posting of a
bond or other security, a certificate of the chief financial
officer of the Company setting forth details as to such
occurrence and action, if any, which any member of the ERISA
Group is required or proposes to take;
(h) promptly after the commencement thereof, notice of all
actions, suits and proceedings before any court or governmental
43
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, affecting the Company or any of its
Subsidiaries which have a reasonable likelihood of a material
adverse effect on the financial condition, properties, or
operations of the Company and its Subsidiaries taken as a whole;
(i) If, at any time, the Company shall become aware or have
reasonable cause to believe (i) that Hazardous Substances or
solid wastes have been released, or have otherwise come to be
located, on or in or have begun to affect any real property owned
or leased by the Company or any Subsidiary or that any liability
arising out of the violation of any Environmental Laws has
arisen, including liability for off-site environmental
conditions, or (ii) that a notice has been received from any
governmental body or other party seeking any information or
alleging any violation of any Environmental Laws or alleging any
liability with regard to any real property owned or leased by the
Company or any Subsidiary or off-site environmental conditions,
in either case which may materially impair the Borrowers' ability
to meet their obligations under the Facility Documents, the
Company shall promptly give notice of that event to the Agent;
and
(j) such other information respecting the condition or
operations, financial or otherwise, of the Company or any of its
Subsidiaries as the Agent or any Bank may from time to time
reasonably request.
Section 6.2. PAYMENT OF OBLIGATIONS. The Company will pay
and discharge, and will cause each Subsidiary to pay and
discharge, at or before maturity or in accordance with the
Company's customary trade practices, all their respective
material obligations and liabilities, including tax liabilities,
except where the same may be contested in good faith by appropri
ate proceedings, and will maintain, and will cause each Subsid
iary to maintain, in accordance with generally accepted account
ing principles, appropriate reserves for the accrual of any of
the same.
Section 6.3. MAINTENANCE OF PROPERTY; INSURANCE. (a) The
Company will maintain, and will cause each Subsidiary to
maintain, all property useful and necessary in its business in
good working order and condition, ordinary wear and tear
excepted.
(b) To the extent that insurance is reasonably available to
the Company and its Subsidiaries at a price comparable to the
price paid by other Persons in the same or similar types of
business conducted by the Company and such Subsidiary, the
Company will, and will cause each of its Subsidiaries to,
maintain (either in the name of the Company or in such
Subsidiary's own name) with financially sound and responsible
44
insurance companies, insurance on all their respective properties
in at least such amounts and against at least such risks (and
with such risk retention) as are (i) insured against under the
policies of insurance of the Company and its Subsidiaries set
forth on the schedule previously provided by the Company to the
Banks or (ii) usually insured against in the same general area by
companies of established repute engaged in the same or a similar
business; and will furnish to the Banks, upon request from the
Agent, information presented in reasonable detail as to the
insurance so carried. To the extent such insurance is not
obtained, the Company will adopt, in lieu of or supplemental to
such insurance, such other plan or method of protection, whether
by the establishment of an insurance fund or a reserve to be held
and applied to casualty losses, or otherwise, satisfactory to the
Banks and conforming to the practices of similar corporations
self-insurance.
Section 6.4. CONDUCT OF BUSINESS AND MAINTENANCE OF
EXISTENCE. The Company will continue, and will cause each
Subsidiary to continue, to engage in business of the same general
type as now conducted by the Company and its Subsidiaries (i.e.,
the business of specialty chemicals and related equipment), and
will preserve, renew and keep in full force and effect, and will
cause each Subsidiary to preserve, renew and keep in full force
and effect their respective corporate existence and their
respective permits, licenses, certifications, approvals, rights,
privileges and franchises necessary or desirable in the normal
conduct of business; PROVIDED that nothing in this Section 6.4
shall prohibit (a) the merger or consolidation of a Subsidiary
with or into another Person if the corporation surviving such
consolidation or merger is a Wholly-Owned Subsidiary or the
merger of a Subsidiary into the Company if, in each case, after
giving effect thereto, no Default shall have occurred and be
continuing, or (b) the termination of the corporate existence of
any Subsidiary if (i) such termination is not materially
disadvantageous to the Banks and the Company in good faith
determines that such termination is in the best interest of the
Company or (ii) such termination is in compliance with clause
(ii) of the proviso in Section 7.5.
Section 6.5. COMPLIANCE WITH LAWS. The Company will
comply, and will cause each Subsidiary to comply, in all material
respects with all applicable laws, ordinances, rules, regulations
and requirements of governmental authorities (including
Environmental Laws and ERISA and the rules and regulations
thereunder), whether foreign or domestic, except (a) where the
necessity of compliance therewith is contested in good faith by
appropriate proceedings and appropriate reserves are maintained
and (b) where failure to comply with such law, ordinance, rules,
regulation or requirement would not have a material adverse
effect on the financial condition of the Company and its
Subsidiaries taken as a whole.
45
Section 6.6. INSPECTION OF PROPERTY, BOOKS AND RECORDS.
The Company will keep, and will cause each Subsidiary to keep,
proper books of record and account in which materially full, true
and correct entries shall be made of all dealings and transac
tions in relation to its business and activities; and will
permit, and will cause each Subsidiary to permit, representatives
of any Bank to visit and inspect any of their respective
properties, to examine and make abstracts from any of their
respective books and records and to discuss their respective
affairs, finances and accounts with their respective officers,
employees and independent public accountants, PROVIDED the
Company shall have the right to be present at any meeting with
its independent public accountants, all at such reasonable times,
upon reasonable notice and as often as may reasonably be desired.
Section 6.7. MAINTENANCE OF OWNERSHIP OF SUBSIDIARIES. The
Company will at all times maintain direct or indirect legal and
beneficial ownership of the percentage of outstanding shares of
each class of capital stock substantially as set forth on
SCHEDULE I of each of its Subsidiaries, except as modified by a
consolidation merger or sale permitted pursuant to the proviso to
Section 7.5.
Section 6.8. REVIEWED DIVISION FINANCIAL STATEMENTS. As
soon as available, but in no event later then ninety (90) days
following the Closing Date, the Company shall deliver to the
Agent the year to date reviewed financial statements of the
Hercules Division as of November 30, 1995, contemplated by the
Purchase Agreement.
ARTICLE 7.NEGATIVE COVENANTS
So long as any of the Notes shall remain unpaid, any amounts
shall be owing hereunder by any Borrower, or any Bank shall have
any Commitment under this Agreement, the Company shall not, and
will not permit any Subsidiary to:
Section 7.1. DEBT. Incur or at any time be liable with
respect to any Debt except:
(a) Debt outstanding under this Agreement and the Notes;
(b) Debt outstanding on the date of this Agreement and
identified on SCHEDULE II;
(c) Debt (in addition to the allowances in subsections (a),
(b), (d), (e), (f) and (g) of this Section 7.1 in an aggregate
principal amount not to exceed $15,000,000 at any time
outstanding; PROVIDED that at such time as the Company's ratio of
Debt to Consolidated EBITDA minus Consolidated Capital
Expenditures (tested at the end of each calendar quarter for the
46
twelve-month period then ended) is equal to or less than 2.00 to
1.00, the Company and its Subsidiaries may incur Debt in an
aggregate principal amount not to exceed $25,000,000 pursuant to
this Section 7.1(c); and at such time as such ratio is equal to
or less than 1.75 to 1.0, the Company and its Subsidiaries may
incur Debt in an aggregate principal amount not to exceed
$30,000,000 pursuant to this Section 7.1(c);
(d) Debt subordinated to the Debt hereunder, in amounts and
on terms and conditions satisfactory to the Required Banks;
(e) Guarantees by the Guarantors of the Debt hereunder;
(f) From the date hereof until March 31, 1997, Guarantees
of obligations which do not exceed in the aggregate $10,000,000;
from April 1, 1997 until March 31, 1998, Guarantees of
obligations which do not exceed in the aggregate $14,000,000;
from April 1, 1998 until March 31, 1999, Guarantees of
obligations which do not exceed in the aggregate $20,000,000; and
thereafter Guarantees of obligations which do not exceed in the
aggregate $24,000,000; and
(g) Up to an aggregate of $15,000,000 of Intercompany Debt.
Section 7.2. RESTRICTED PAYMENTS. Declare or make any
Restricted Payment unless (a) no Default or Event of Default has
occurred and is continuing and (b) immediately after giving
effect thereto, the aggregate of all Restricted Payments declared
or made subsequent to the Closing Date does not exceed
$17,500,000 plus 50% of Consolidated Net Income (less
consolidated net loss, if any) of the Company and its Consolidat
ed Subsidiaries for the period from March 31, 1994 through the
end of the Company's then most recent fiscal quarter (treated for
this purpose as a single accounting period). Nothing in this
Section 7.2 shall prohibit the payment of any dividend or
distribution within 60 days after the declaration thereof if such
declaration was not prohibited by this Section 7.2.
Section 7.3. INVESTMENTS. Make or acquire any Investment
in any Person other than:
(a) Investments outstanding as of March 31, 1995 (such
Investments in excess of $1,000,000 are set forth on SCHEDULE
IV);
(b) Investments in joint ventures of the Company or its
Subsidiaries, if after giving effect thereto the aggregate amount
of all such Investments does not exceed $10,000,000 outstanding
at any one time, excluding any Investments described in
Section 7.3(a) above;
(c) deposits with, or time deposits with, including
47
certificates of deposits issued by, (i) any office located in the
United States of any bank or trust company which is organized
under the laws of the United States or any state thereof and has
capital surplus and undivided profits aggregating at least
$100,000,000 (ii) any Bank or (iii) any foreign bank for which
Standard and Poors Rating Group or Xxxxx'x Investors Service,
Inc. issues a rating of "A" or higher and which has capital
surplus and undivided profits aggregating at least $100,000,000;
(d) Investments in investment grade securities;
(e) Investments made in another Person pursuant to a merger
or asset acquisition made in compliance with subsection (i) of
the proviso in Section 7.5; and
(f) other Investments up to $10,000,000 in the aggregate.
The amount of any Investment shall be the original cost of
such Investment plus the cost of all additions thereto, without
adjustments for increases or decreases in value, write-ups,
write-downs or write-offs with respect to such Investment.
Section 7.4. NEGATIVE PLEDGE. Create, assume or suffer to
exist any Lien on any asset now owned or hereafter acquired by
it, except:
(a) Liens existing on the date of this Agreement securing
Debt outstanding on the date of this Agreement and identified on
Schedule II;
(b) Permitted Liens; and
(c) any Lien existing on any non-current asset securing
Debt (i) in an amount up to $7,500,000 during the period from the
Closing Date until June 30, 1996; (ii) in an amount up to
$9,000,000 during the period from July 1, 1996 until June 30,
1997; and (iii) which amount shall be increased by $1,500,000 for
each twelve month period thereafter.
Section 7.5. CONSOLIDATIONS, MERGERS ABD SALES OF ASSETS.
(a) consolidate or merge with or into any other Person or (b)
sell, lease or otherwise transfer, directly or indirectly in one
transaction or a series of related transactions, all or any
substantial part of its assets (including in the case of the
Company, the stock of its Subsidiaries) to any other Person;
PROVIDED that (i) the Company or any Subsidiary may merge with or
acquire the assets of another Person which is in the business of
specialty chemicals and related equipment if (A) the Company or
the Subsidiary is the surviving entity and (B) after giving
effect thereto the ratio of Consolidated Debt to Consolidated
EBITDA on a pro forma basis (including synergies agreed to by the
Agent) is equal to or less than 3.25 to 1.0, (ii) the Company or
48
any Subsidiary may, in the aggregate, sell assets in the ordinary
course of business and sell (A) up to $7,500,000 additional
assets during the period from the Closing Date until June 30,
1996; (B) up to $9,000,000 additional assets during the period
from July 1, 1996 to June 30, 1997, which amount shall be
increased by $1,500,000 for each twelve month period thereafter;
and (iii) a Subsidiary of the Borrower may merge with the
Borrower or a Wholly-Owned Subsidiary of the Borrower if (A) the
Borrower or such Wholly-Owned Subsidiary, as the case may be, is
the corporation surviving such merger and (B) immediately after
giving effect to such merger, no Default shall have occurred and
be continuing.
Section 7.6. TRANSACTIONS WITH AFFILIATES. Directly or
indirectly, pay any funds to or for the account of, make any
Investment in (whether by acquisition of stock or indebtedness,
by loan, advance, transfer of property, guarantee or other
agreement to pay, purchase or service, directly or indirectly,
any Debt, or otherwise), lease, sell, transfer or otherwise
dispose of any assets, tangible or intangible, to, or participate
in, or effect any transaction in connection with any joint
enterprise or other joint arrangement with, any Affiliate;
PROVIDED, HOWEVER, that the foregoing provisions of this
Section 7.6 shall not prohibit (a) the Company from declaring or
paying any lawful dividend so long as, after giving effect
thereto, no Default shall have occurred and be continuing, (b)
the Company or any Subsidiary from making sales to or purchases
from any Affiliate and, in connection therewith, extending credit
or making payments, or from making payments for extending credit
or making payments, or from making payments for services rendered
by any Affiliate, if such sales or purchases are made or such
services are rendered in the ordinary course of business and on
terms and conditions at least as favorable to the Company or such
Subsidiary as the terms and conditions which would apply in a
similar transaction with a Person not an Affiliate, (c) the
Company or any Subsidiary from participating in, or effecting
any transaction in connection with, any joint enterprise or other
joint arrangement with any Affiliate if the Company or such
Subsidiary participates in the ordinary course of its business
and on a basis no less advantageous than the basis on which such
Affiliate participates, (d) any transactions between the Company
and any Eligible Subsidiary which has executed and delivered an
Election to Participate which is still in effect or any
Subsidiary that has executed a Guaranty hereunder, (e) any
payment from any Subsidiary to the Company, (f) intercompany
loans involving only the Company and its Subsidiaries which are
Guarantors, and (g) Intercompany Debt which does not exceed
$15,000,000 in the aggregate.
ARTICLE 8. FINANCIAL COVENANTS
49
So long as any of the Notes shall remain unpaid, any amounts
shall be owing hereunder by any Borrower, or any Bank shall have
any Commitment under this Agreement, the Company covenants that:
Section 8.1. EBIT TO INTEREST EXPENSE RATIO. The Company's
ratio of Consolidated EBIT for the preceding four fiscal quarters
to Consolidated Interest Expense for the preceding four fiscal
quarters shall not be less than 2.50 to 1.00, tested at end of
each fiscal quarter.
Section 8.2. MINIMUM CONSOLIDATED NET WORTH. The Company
shall maintain at all times Consolidated Net Worth at the end of
each fiscal quarter of not less than $80,000,000 (subject to a
dollar for dollar downward adjustment equal to the amount, if
any, by which the Company's independent auditor's valuation of
the Preferred Stock is less than $30,000,000, but in no event
shall the adjustment be greater than $5,000,000), PLUS an amount
equal to the sum of (a) 50% of Consolidated Net Income for each
full fiscal quarter since the date hereof to the measurement date
PLUS (b) an amount equal to the net proceeds received by the
Borrower from the issuance of its capital stock during such
period.
Section 8.3. MAXIMUM TOTAL DEBT TO NET WORTH RATIO. The
Company's ratio of Consolidated Total Debt to Consolidated Net
Worth tested at the end of each quarter shall not during the
periods set forth below exceed the following:
PERIOD RATIO
Closing Date to March 31, 1997 2.00 to 1.00
April 1, 1997 to March 31, 1998 1.80 to 1.00
April 1, 1998 to March 31, 1999 1.60 to 1.00
April 1, 1999 to march 31, 2000 1.40 to 1.00
April 1, 2000 and thereafter 1.20 to 1.00
ARTICLE 9. EVENTS OF DEFAULT
Section 9.1. EVENTS OF DEFAULT. Any of the following
events shall be an "Event of Default":
(a) any Borrower shall: (i) fail to pay the principal of
any Note as and when due and payable and such failure shall
continue for five (5) Banking Days; (ii) fail to pay interest on
any Note or any fee or other amount due hereunder as and when due
and payable and such failure shall continue for thirty (30)
Banking Days;
(b) any representation or warranty made or deemed made by
any Borrower in this Agreement or in any other Facility Document
or which is contained in any certificate, document, opinion,
financial or other written statement furnished at any time under
50
or in connection with any Facility Document shall prove to have
been incorrect in any material respect on or as of the date made
or deemed made;
(c) any Borrower shall fail to perform or observe any term,
covenant or agreement contained in Article 6, Article 7 or
Article 8;
(d) any Borrower shall fail to perform or observe any term,
covenant or agreement on its part to be performed or observed
(other than the obligations specifically referred to elsewhere in
this Section 9.1) in any Facility Document and such failure shall
continue for thirty (30) consecutive calendar days after written
notice thereof has been given to the Company by the Agent at the
request of the Required Banks;
(e) the Company or any Subsidiary shall fail to make any
payment in respect of any Material Debt when due or within any
applicable grace period;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables (or,
with the giving of notice or lapse of time or both, would enable)
the holder of such Debt or any Person acting on such holder's
behalf to accelerate the maturity thereof;
(g) the Company or any Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its
debts under any bankruptcy, insolvency or other similar law now
or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any
such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as
they become due, or shall take any corporate action to authorize
any of the foregoing;
(h) an involuntary case or other proceeding shall be
commenced against the Company or any Subsidiary seeking
liquidation, reorganization or other relief with respect to it or
its debts under any bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and
unstayed for a period of sixty (60) days; or an order for relief
shall be entered against the Company or any Subsidiary under the
federal bankruptcy laws as now or hereafter in effect;
51
(i) any member of the ERISA Group shall fail to pay when
due an amount or amounts aggregating in excess of $500,000 which
such member shall have become liable to pay under Title IV of
ERISA; or notice of intent to terminate a Material Plan shall be
filed under Title IV of ERISA by any member of the ERISA Group,
any plan administrator or any combination of the foregoing; or
the PBGC shall institute proceedings under Title IV of ERISA to
terminate, to impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any Material Plan must be terminated; or
there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with
respect to, one or more Multiemployer Plans which could cause one
or more members of the ERISA Group to incur a current payment
obligation in excess of $500,000;
(j) a judgment or order for the payment of money in excess
of $5,000,000 shall be rendered against the Company or any
Subsidiary and such judgment or order shall continue unsatisfied
and unstayed for a period of (i) in the case of a judgment or
order rendered by a court, arbitrator or governmental authority
located in the United States, ten (10) days or (ii) in the case
of a judgment or order rendered by a court, arbitrator or
governmental authority located outside the United States, thirty
(30) days; or
(k) a "mandatory redemption" (as defined therein) occurs
under the Preferred Stock Agreement following a "change of
control" (as defined in the Preferred Stock Agreement").
Section 9.2. REMEDIES. If any Event of Default shall occur
and be continuing, the Agent shall, upon request of the Required
Banks, by notice to the Borrowers, (a) declare the Commitments to
be terminated, whereupon the same shall forthwith terminate, and
(b) declare the outstanding principal of the Notes, all interest
thereon and all other amounts payable under this Agreement and
the Notes to be forthwith due and payable, whereupon the Notes,
all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest
or further notice of any kind, all of which are hereby expressly
waived by the Borrowers; PROVIDED that, in the case of an Event
of Default referred to in Section 9.1(g) or 9.1(h) above, the
Commitments shall be immediately terminated, and the Notes, all
interest thereon and all other amounts payable under this
Agreement and each of the other Facility Documents shall be
immediately due and payable without notice, presentment, demand,
protest or other formalities of any kind, all of which are hereby
expressly waived by each of the Borrowers.
52
ARTICLE 10. THE AGENT; RELATIONS AMONG BANKS AND BORROWER.
Section 10.1. APPOINTMENT, POWERS AND IMMUNITIES OF AGENT.
Each Bank hereby irrevocably appoints and authorizes the Agent to
act as its agent hereunder and under any other Facility Document
with such powers as are specifically delegated to the Agent by
the terms of this Agreement or any other Facility Document,
together with such other powers as are reasonably incidental
thereto. The Agent shall have no duties or responsibilities
except those expressly set forth in this Agreement or any other
Facility Document, and shall not by reason of this Agreement be a
trustee for any Bank. The Agent shall not be responsible to the
Banks for any recitals, statements, representations or warranties
made by any Borrower or any officer or official of any Borrower
or any other Person contained in this Agreement or any other
Facility Document, or in any certificate or other document or
instrument referred to or provided for in, or received by any
Bank under, this Agreement or any other Facility Document, or for
the value, legality, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other
Facility Document or any other document or instrument referred to
or provided for herein or therein, for the perfection or priority
of any collateral security for the Loans, if any, or for any
failure by any Borrower to perform any of such Borrower's
obligations under this Agreement or any other Facility Document.
The Agent may employ agents and attorneys-in-fact and shall not
be responsible, except as to money or securities received by the
Agent or its authorized agents, for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it with
reasonable care. Neither the Agent nor any of its directors,
officers, employees or agents shall be liable or responsible for
any action taken or omitted to be taken by the Agent or any one
or more of them hereunder or under any other Facility Document or
in connection herewith or therewith, except for its or their own
gross negligence or willful misconduct or action not authorized
under this Agreement or by the Required Banks which is in
violation of law and results in a liability of the Banks to any
Borrower. The Company shall pay any fee agreed to by the Company
and the Agent with respect to the Agent's services hereunder.
Section 10.2. RELIANCE BY AGENT. The Agent shall be
entitled to rely upon any certification, notice or other
communication (including any thereof by telephone, facsimile,
telex, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by
the Agent. The Agent may deem and treat each Bank as the holder
of the Loans made by such Bank for all purposes hereof unless and
until a notice of the assignment or transfer thereof satisfactory
to the Agent signed by such Bank shall have been furnished to the
Agent, but the Agent shall not be required to deal with any
53
Person who has acquired a participation in any Loan from a Bank.
As to any matters not expressly provided for by this Agreement or
any other Facility Document, the Agent shall in all cases be
fully protected in acting, or in refraining from acting,
hereunder in accordance with instructions signed by the Required
Banks, and such instructions of the Required Banks and any action
taken or failure to act pursuant thereto shall be binding on all
of the Banks and any other holder of all or any portion of any
Loan.
Section 10.3. DEFAULTS. The Agent shall not be deemed to
have knowledge of the occurrence of any Default or Event of
Default (other than the non-payment of principal of or interest
on the Loans to the extent the same is required to be paid to the
Agent for the account of the Banks) unless the Agent has received
notice from a Bank or a Borrower specifying such Default or Event
of Default and stating that such notice is a "Notice of Default."
If the Agent receives such a notice of the occurrence of a
Default or Event of Default, the Agent shall give prompt notice
thereof to the Banks (and shall give each Bank prompt notice of
each such non-payment). The Agent shall (subject to
Section 10.8) take such action with respect to such Default or
Event of Default which is continuing as shall be directed by the
Required Banks; PROVIDED that, unless and until the Agent shall
have received such directions, the Agent may take such action, or
refrain from taking such action, with respect to such Default or
Event of Default as the Agent shall deem advisable and in the
best interest of the Banks; and PROVIDED further that the Agent
shall not be required to take any such action which the Agent
determines to be contrary to law.
Section 10.4. RIGHTS OF AGENT AS A BANK. With respect to
its Commitment and the Loans made by it, the Agent in its
capacity as a Bank hereunder shall have the same rights and
powers hereunder as any other Bank and may exercise the same as
though it were not acting as the Agent, and the term "Bank" or
"Banks" shall, unless the context otherwise indicates, include
the Agent in its capacity as a Bank. The Agent and its
affiliates may (without having to account therefor to any Bank)
accept deposits from, lend money to (on a secured or unsecured
basis), and generally engage in any kind of banking, trust or
other business with, any Borrower (and any of such Borrower's
Affiliates) as if the Agent were not acting as the Agent, and the
Agent may accept fees and other consideration from any Borrower
for services in connection with this Agreement or otherwise
without having to account for the same to the Banks.
Section 10.5. INDEMNIFICATION OF AGENT. The Banks agree to
indemnify the Agent (to the extent not reimbursed under
Section 12.3 or under the applicable provisions of any other
Facility Document, but without limiting the obligations of the
Borrowers under Section 12.3 or such applicable provisions),
54
ratably in accordance with the aggregate unpaid principal amount
of the Loans made by the Banks (without giving effect to any
participations, in all or any portion of such Loans, sold by them
to any other Person) (or, if no Loans are at the time
outstanding, ratably in accordance with their respective
Commitments), for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way
relating to or arising out of this Agreement, any other Facility
Document or any other documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or
thereby (including the costs and expenses which any Borrower is
obligated to pay under Section 12.3 or under the applicable
provisions of any other Facility Document but excluding, unless a
Default or Event of Default has occurred, normal administrative
costs and expenses incident to the performance of its agency
duties hereunder) or the enforcement of any of the terms hereof
or thereof or of any such other documents or instruments;
PROVIDED that no Bank shall be liable for any of the foregoing to
the extent they arise from the gross negligence or willful
misconduct of the Agent or actions not authorized under this
Agreement or by the Required Banks which are in violation of law
and result in a liability of the Banks to any Borrower.
Section 10.6. DOCUMENTS. The Agent will forward to each
Bank, promptly after the Agent's receipt thereof, a copy of each
report, notice or other document required by this Agreement or
any other Facility Document to be delivered to the Agent for such
Bank.
Section 10.7. NON-RELIANCE ON AGENT AND OTHER BANKS. Each
Bank agrees that it has, independently and without reliance on
the Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit
analysis of the Company and the Company's Subsidiaries and its
own decision to enter into this Agreement and that it will,
independently and without reliance upon the Agent or any other
Bank, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own analyses
and decisions in taking or not taking action under this Agreement
or any other Facility Document. The Agent shall not be required
to keep itself informed as to the performance or observance by
the Company or the Company's Subsidiaries of this Agreement or
any other Facility Document or any other document referred to or
provided for herein or therein or to inspect the properties or
books of the Company or any Subsidiary. Except for notices,
reports and other documents and information expressly required to
be furnished to the Banks by the Agent hereunder, the Agent shall
not have any duty or responsibility to provide any Bank with any
credit or other information concerning the affairs, financial
condition or business of the Company or any Subsidiary (or any of
55
the Company's or any Subsidiary's Affiliates) which may come into
the possession of the Agent or any of the Agent's affiliates.
The Agent shall not be required to file this Agreement, any other
Facility Document or any document or instrument referred to
herein or therein, for record or give notice of this Agreement,
any other Facility Document or any document or instrument
referred to herein or therein, to any Person.
Section 10.8. FAILURE OF AGENT TO ACT. Except for action
expressly required of the Agent hereunder, the Agent shall in all
cases be fully justified in failing or refusing to act hereunder
unless the Agent shall have received further assurances (which
may include cash collateral to the extent permitted by law) of
the indemnification obligations of the Banks under Section 10.5
in respect of any and all liability and expense which may be
incurred by the Agent by reason of taking or continuing to take
any such action.
Section 10.9. RESIGNATION OF AGENT. Subject to the
appointment and acceptance of a successor Agent as provided
below, the Agent may resign at any time by giving thirty (30)
days prior written notice thereof to the Banks and the Company;
PROVIDED that the Company and the other Banks shall be promptly
notified thereof. Upon any such resignation, the Required Banks
shall have the right to appoint, with the consent of the Company,
which consent shall not be unreasonably withheld or delayed, a
successor Agent, which shall be a commercial bank organized or
licensed under the laws of the United States of America or of any
state thereof, with an office in New York, New York and having a
combined capital and surplus of at least $100,000,000. If no
successor Agent shall have been so appointed by the Required
Banks and shall have accepted such appointment within thirty (30)
days after the retiring Agent gives notice of resignation, then
the retiring Agent may, on behalf of the Banks and without the
consent of the Company, appoint a successor Agent, which shall be
a commercial bank organized or licensed under the laws of the
United States of America or of any state thereof, with an office
in New York, New York, and having a combined capital and surplus
of at least $100,000,000. The Required Banks or the retiring
Agent, as the case may be, shall, upon the appointment of a
successor Agent, promptly so notify the Company and the other
Banks. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the
provisions of this Article 10 shall continue in effect for such
retiring Agent's benefit in respect of any actions taken or
omitted to be taken by such retiring Agent while it was acting as
the Agent.
56
Section 10.10. AMENDMENTS CONCERNING AGENCY FUNCTION. The
Agent shall not be bound by any waiver, amendment, supplement or
modification of this Agreement or any other Facility Document
which affects its duties hereunder or thereunder unless the Agent
shall have given its prior consent thereto.
Section 10.11. LIABILITY OF AGENT. The Agent shall not
have any liabilities or responsibilities to any Borrower on
account of the failure of any Bank to perform such Bank's
obligations hereunder or under any other Facility Document or to
any Bank on account of the failure of any Borrower to perform its
obligations hereunder or under any other Facility Document. This
Section 10.11 shall not be construed to relieve the Agent of any
liability it may have as a Bank when acting in its capacity as a
Bank hereunder.
Section 10.12. TRANSFER OF AGENCY FUNCTION. Without the
consent of the Company or any Bank, the Agent may at any time or
from time to time transfer its functions as Agent hereunder to
any of its offices wherever located, PROVIDED that the Agent
shall promptly notify the Company and the Banks thereof.
Section 10.13. NON-RECEIPT OF FUNDS BY THE AGENT. Unless
the Agent shall have been notified by a Bank or a Borrower
(either one, as appropriate, being the "Payor") prior to the date
on which such Bank is to make payment hereunder to the Agent of
the proceeds of a Loan or any Borrower is to make payment to the
Agent, as the case may be (either such payment being a "Required
Payment"), which notice shall be effective upon receipt, that the
Payor does not intend to make the Required Payment to the Agent,
the Agent may assume that the Required Payment has been made and
may, in reliance upon such assumption (but shall not be required
to), make the amount thereof available to the intended recipient
on such date and, if the Payor has not in fact made the Required
Payment to the Agent, the recipient of such payment from the
Agent (and, if such recipient is a Borrower and the Payor Bank
fails to pay the amount thereof to the Agent forthwith upon
demand, such Borrower) shall, on demand, repay to the Agent the
amount made available to it together with interest thereon for
the period from the date such amount was so made available by the
Agent until the date the Agent recovers such amount at a rate per
annum equal to the average daily Federal Funds Rate for such
period.
Section 10.14. WITHHOLDING TAXES. Each Bank represents
that it is entitled to receive any payments to be made to it
hereunder without the withholding of any tax and will furnish to
the Agent such forms, certifications, statements and other
documents as the Agent may request from time to time to evidence
such Bank's exemption from the withholding of any tax imposed by
any jurisdiction or to enable the Agent to comply with any
applicable laws or regulations relating thereto. Without
57
limiting the effect of the foregoing, if any Bank is not created
or organized under the laws of the United States of America or
any state thereof, if the payment of interest by any Borrower is
treated for U.S. income tax purposes as derived in whole or in
part from sources from within the U.S., such Bank will furnish to
the Agent and such Borrower Form 4224 or Form 1001 of the
Internal Revenue Service, or such other forms, certifications,
statements or documents, duly executed and completed by such Bank
as evidence of such Bank's exemption from the withholding of U.S.
tax with respect thereto. The Agent shall not be obligated to
make any payments hereunder to such Bank in respect of any Loan
or such Bank's Commitment until such Bank shall have furnished to
the Agent the requested form, certification, statement or
document.
Section 10.15. SEVERAL OBLIGATIONS AND RIGHTS OF BANKS.
The failure of any Bank to make any Loan to be made by it on the
date specified therefor shall not relieve any other Bank of such
other Bank's obligation to make its Loan or Loans on such date,
but no Bank shall be responsible for the failure of any other
Bank to make a Loan to be made by such other Bank. The amounts
payable at any time hereunder to each Bank shall be a separate
and independent debt, and 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.
Section 10.16. PRO RATA TREATMENT OF LOANS, ETC. Except to
the extent otherwise provided: (a) each Borrowing under
Section 2.7 shall be made from the Banks, each reduction or
termination of the amount of the Commitments under Section 2.10
shall be applied to the Commitments of the Banks, and each
payment of commitment fee accruing under Section 2.14 shall be
made for the account of the Banks, PRO RATA according to the
amounts of their respective unused Commitments; (b) each
conversion under Section 2.8 of Loans of a particular type (other
than conversions provided for by Section 3.4), shall be made PRO
RATA among the Banks holding Loans of such type according to the
respective principal amounts of such Loans by such Banks; and (c)
each prepayment and payment of principal of or interest on Loans
of a particular type and a particular Interest Period shall be
made to the Agent for the account of the Banks holding Loans of
such type and Interest Period PRO RATA in accordance with the
respective unpaid principal amounts of such Loans of such
Interest Period held by such Banks.
Section 10.17. SHARING OF PAYMENTS AMONG BANKS. If a Bank
shall obtain payment of any principal of or interest on any Loan
made by it through the exercise of any right of setoff, banker's
lien, counterclaim, or by any other means, such Bank shall
promptly purchase from the other Banks participations in (or, if
and to the extent specified by such Bank, direct interests in)
58
the Loans made by the other Banks in such amounts, and make such
other adjustments from time to time as shall be equitable to the
end that all the Banks shall share the benefit of such payment
(net of any expenses which may be incurred by such Bank in
obtaining or preserving such benefit) PRO RATA in accordance with
the unpaid principal and interest on the Loans held by each of
the Banks. To such end the Banks shall make appropriate
adjustments among themselves (by the resale of participations
sold or otherwise) if such payment is rescinded or must otherwise
be restored. Each Borrower agrees that any Bank so purchasing a
participation (or direct interest) in the Loans made by other
Banks may exercise all rights of setoff, banker's lien,
counterclaim or similar rights with respect to such participation
(or direct interest). Nothing contained herein shall require any
Bank to exercise any such right of setoff, banker's lien,
counterclaim or similar right of setoff, banker's lien,
counterclaim or similar right or shall affect the right of any
Bank to exercise, and retain the benefits of exercising, any such
right with respect to any other indebtedness of any Borrower.
ARTICLE 11. GUARANTY
Section 11.1. THE GUARANTY. The Company hereby
unconditionally guaranties the full and punctual payment (whether
at stated maturity, upon acceleration or otherwise) of the
principal of and interest on each Term Note and each Note issued
by any Eligible Subsidiary pursuant to this Agreement, and the
full and punctual payment of all other amounts payable by
MacDermid Imaging or any Eligible Subsidiary under this Agreement
and each other Facility Document. Upon failure by MacDermid
Imaging or any Eligible Subsidiary to pay punctually any such
amount, the Company shall forthwith on demand pay the amount not
so paid at the place and in the manner specified in this
Agreement or the other applicable Facility Document.
Section 11.2. GUARANTY UNCONDITIONAL. The obligations of
the Company under this Article 11 shall be unconditional and
absolute and, without limiting the generality of the foregoing,
shall not be released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver
or release in respect of any obligation of any Eligible
Subsidiary under this Agreement or any Note or any other Facility
Document, by operation of law or otherwise;
(b) any modification or amendment of or supplement to this
Agreement or any Note or any other Facility Document;
(c) any release, non-perfection or invalidity of any direct
or indirect security for any obligation of any Eligible
59
Subsidiary under this Agreement or any Note or any other Facility
Document;
(d) Any change in the corporate existence, structure or
ownership of MacDermid Imaging or any Eligible Subsidiary, or any
insolvency, bankruptcy, reorganization or other similar
proceeding affecting MacDermid Imaging or any Eligible Subsidiary
or its assets or any resulting release or discharge of MacDermid
Imaging or any obligation of any Eligible Subsidiary contained in
this Agreement or any Note; or any other Facility Document
(e) the existence of any claim, set-off or other rights
which the Company may have at any time against MacDermid Imaging
or any Eligible Subsidiary, the Agent, any Bank or any other
Person, whether in connection herewith or any unrelated
transactions; PROVIDED that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory
counterclaim;
(f) any invalidity or unenforceability relating to or
against MacDermid Imaging or any Eligible Subsidiary, for any
reason, of this Agreement or any Note or any other Facility
Document, or any provision of applicable law or regulation
purporting to prohibit the payment by any Eligible Subsidiary of
the principal of or interest on any Note or any other amount
payable by it under this Agreement or any other Facility
Document; or
(g) any other act or omission to act or delay of any kind
by MacDermid Imaging or any Eligible Subsidiary, the Agent, any
Bank or any other Person or any other circumstance whatsoever
which might, but for the provisions of this Section 11.2,
constitute a legal or equitable discharge of the Company's
obligations hereunder.
Section 11.3. DISCHARGE ONLY UPON PAYMENT IN FULL;
REINSTATEMENT IN CERTAIN CIRCUMSTANCES. The Company's
obligations under this Article 11 shall remain in full force and
effect until the Commitments shall have terminated and the
principal of and interest on the Notes and all other amounts
payable by the Company MacDermid Imaging or and each Eligible
Subsidiary under this Agreement and each of the other Facility
Documents shall have been finally and indefeasibly paid in full
in cash. If at any time any payment of the principal of or
interest on any Note or any other amount payable by any MacDermid
Imaging or Eligible Subsidiary under this Agreement or any other
Facility Document is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of
MacDermid Imaging or any Eligible Subsidiary or otherwise, the
Company's obligations hereunder with respect to such payment
shall be reinstated at such time as though such payment had been
due but not made at such time.
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Section 11.4. WAIVER BY THE COMPANY. The Company
irrevocably waives acceptance hereof, presentment, demand,
protest and any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person
against any Eligible Subsidiary or any other Person.
Section 11.5. SUBROGATION. The Company irrevocably waives
any and all rights to which it may be entitled, by operation of
law or otherwise, upon making any payment hereunder to be
subrogated to the rights of the payee against MacDermid Imaging
or an Eligible Subsidiary with respect to such payment or
otherwise to be reimbursed, indemnified or exonerated by
MacDermid Imaging or an Eligible Subsidiary in respect thereof.
Section 11.6. STAY OF ACCELERATION. If acceleration of the
time for payment of any amount payable by MacDermid Imaging or
any Eligible Subsidiary under this Agreement or its Notes or any
other Facility Document is stayed upon insolvency, bankruptcy or
reorganization of MacDermid Imaging or such Eligible Subsidiary,
all such amounts otherwise subject to acceleration under the
terms of this Agreement shall nonetheless be payable by the
Company hereunder forthwith on demand by the Agent made at the
request of the Required Banks.
ARTICLE 12. MISCELLANEOUS
Section 12.1. AMENDMENTS AND WAIVERS. No amendment or
waiver of any provision of this Agreement, and no consent to any
departure by any Borrower therefrom, shall in any event be
effective unless the same shall be in writing and signed by the
Required Banks, and then such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given. Notwithstanding the foregoing, no
amendment, waiver or consent shall, unless in writing and signed
by the Agent and all the Banks, do any of the following: (a)
increase the Commitments of the Banks or subject the Banks to any
additional obligations, (b) reduce the principal amount of, or
interest on, any Loan or any fees or other amounts payable under
any Facility Document, (c) postpone any date fixed for any
payment of principal of, or interest on, any Loan or any fees or
other amounts payable under any Facility Document, (d) change the
percentage of the Commitments or of the aggregate unpaid
principal amount of Loans, or the number of Banks which shall be
required for the Banks or any of them to take any action under
any Facility Document, (e) amend this Section 12.1, (f) release
the Company's Guaranty described in Article 11 hereof, or (g)
extend the expiration date of a Letter of Credit beyond the tenth
Banking Day prior to the Termination Date; PROVIDED that no
amendment, waiver or consent, unless in writing and signed by the
Agent in addition to the Banks required hereinabove to take such
action, shall affect the rights or duties of the Agent under any
61
Facility Document. No failure on the part of the Agent or any
Bank to exercise, and no delay in exercising, any right hereunder
or under any other Facility Document shall operate as a waiver
thereof or preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
Section 12.2. USURY. Anything herein to the contrary
notwithstanding, the obligations of the Company and its
Subsidiaries under this Agreement and the Notes shall be subject
to the limitation that payments of interest shall not be required
to the extent that receipt thereof would be contrary to
provisions of law applicable to a Bank limiting rates of interest
which may be charged or collected by such Bank.
Section 12.3. EXPENSES; INDEMNIFICATION. (a) The Borrowers
shall reimburse (i) the Agent on demand for all reasonable out-
of-pocket costs, expenses, and charges (including fees and
charges of external legal counsel for the Agent and costs
allocated by its internal legal department) incurred by the Agent
in connection with the preparation, performance, or
administration of this Agreement or the Notes and (ii) the Agent
and the Banks on demand for all costs, expenses, and charges
(including fees and expenses of counsel) in connection with the
enforcement of this Agreement, PROVIDED that the Borrowers shall
not be required to reimburse the Agent for the fees and charges
of the Agent's external legal counsel that exceed $50,000 in
connection with the preparation of this Agreement and the other
Facility Documents.
(b) The Borrowers agree to indemnify the Agent and each
Bank and each of such Persons' respective affiliates and
controlling persons and each of their respective shareholders,
directors, officers, employees, attorneys and agents (each an
"Indemnified Person") from, and hold each of them harmless
against, any and all losses, liabilities, claims, damages
(including consequential damages) or expenses incurred by any of
them arising out of or by reason of or in connection with any
investigation or litigation or other proceedings (including any
threatened investigation or litigation or other proceedings)
arising out of or relating to this Agreement or any other
Facility Document or any actual or proposed use by the Company or
any Subsidiary of the proceeds of the Loans, including the
reasonable fees and disbursements of counsel incurred in
connection with any such investigation or litigation or other
proceedings (but excluding any such losses, liabilities, claims,
damages or expenses that are determined by a court of competent
jurisdiction to have resulted from the gross negligence or
willful misconduct of the applicable Indemnified Person or the
intentional breach by a Bank or the Agent of its agreement to
make Loans or issue a letter of credit in accordance with the
terms of this Agreement).
62
(c) The Borrowers agree to indemnify, hold harmless and
defend each Indemnified Person or any of them from and against
any and all claims, losses, damages, response costs, clean-up
costs and expenses arising out of or in any way relating to the
existence of Hazardous Substances over, beneath, in or upon any
real property owned or leased by the Company or any Subsidiary or
a breach of the representations, warranties, covenants and
agreements set forth in this Agreement, or any violation of any
Environmental Laws or any allegations arising out of any
violation of any Environmental Laws, including: (i) claims of
third parties (including agencies) for damages, penalties,
response costs, clean-up costs, injunctive or other relief; (ii)
costs and expenses of removal and restoration, including
reasonable fees of attorneys and experts, and costs of reporting
the existence of Hazardous Substances to any governmental body,
and (iii) any and all reasonable expenses or obligations incurred
at, before and after any trial or appeal therefrom whether or not
taxable as costs, including witness fees deposition costs,
copying and telephone charges, and reasonable attorneys' fees,
all of which shall be paid by Company when incurred.
(d) Each of the Borrowers hereby waives any right it may
have to seek consequential damages against any Indemnified Person
in connection with this Agreement or any other Facility Document
or any of the transactions contemplated hereby or thereby.
Section 12.4. SURVIVAL. The obligations of the Borrowers
under Sections 3.1, 3.5 and 12.3 shall survive the repayment of
the Loans and the termination of the Commitments.
Section 12.5. ASSIGNMENTS; PARTICIPATIONS. This Agreement
shall be binding upon, and shall inure to the benefit of, the
Borrowers, the Agent, the Banks and their respective successors
and assigns, except that none of the Company, MacDermid Imaging,
or any Eligible Subsidiary may assign or transfer its rights or
obligations hereunder. Each Bank may assign or transfer, or sell
a participation in, all or any part of any Loan, its Commitment
or its interest in any Letters of Credit to another bank or other
financial institution acceptable to the Agent and upon notice to
the Company, in which event (i) in the case of an assignment or
transfer, the assignee or transferee shall have, to the extent of
such assignment or transfer (unless otherwise provided therein),
the same rights, benefits and obligations as such assignee or
transferee would have if it were a Bank hereunder, and (ii) in
the case of the sale of a participation, the participant shall
have no rights under the Facility Documents and all amounts
payable by any Borrower under Article 3 shall be determined as if
such Bank had not sold such participation. Each Bank that sells
any such participation shall deliver a notice to the Company and
the Agent of such participation which shall set forth the
participant and the amount of such participation. Any agreement
executed by such Bank in favor of the participant shall not give
63
the participant the right to require such Bank to take or omit to
take any action hereunder except action requiring the consent of
all of the Banks as set forth in Section 12.1. Upon notice to
the Agent, but without consent of any Person, each Bank may
pledge all or any part of any Loan to a Federal Reserve Bank in
support of borrowings made by such Bank from such Federal Reserve
Bank. Any Bank may furnish any information concerning the
Borrowers in the possession of such Bank from time to time to
assignees and participants (including prospective assignees and
participants); PROVIDED that such Bank shall require any such
prospective assignee or such participant (prospective or
otherwise) to agree in writing to maintain the confidentiality of
such information. In connection with any assignment or transfer
or sale of a participation hereunder, the assigning, transferring
or selling Bank shall pay to the Agent an administrative
processing fee in the amount of $2,500.
Section 12.6. NOTICES. Unless the party to be notified
otherwise notifies the other parties in writing as provided in
this Section 12.6, and except as otherwise provided in this
Agreement, notices shall be given to the Agent by telephone,
confirmed by telex, telecopy, facsimile or other writing, and to
the Banks and to the Borrowers by ordinary mail, telex, telecopy
or facsimile addressed to such party at its address on the
signature page of this Agreement. Notices shall be effective:
(a) if given by mail, 72 hours after deposit in the mails with
first class postage prepaid, addressed as aforesaid; and (b) if
given by telex, telecopy or facsimile, when the telex, telecopy
or facsimile is transmitted to the telex, telecopy or facsimile
number as aforesaid; PROVIDED that notices to the Agent and the
Banks shall be effective upon receipt.
Section 12.7. SETOFF. The Borrowers agree that, in
addition to (and without limitation of) any right of setoff,
banker's lien or counterclaim a Bank may otherwise have, each
Bank shall be entitled, at its option, to offset balances
(general or special, time or demand, provisional or final) held
by such Bank for the account of any Borrower at any of such
Bank's offices, in Dollars or in any other currency, against any
amount payable by any Borrower to such Bank under this Agreement
or any of such Bank's Notes which is not paid when due
(regardless of whether such balances are then due to any
Borrower), in which case such Bank shall promptly notify the
applicable Borrower and the Agent thereof; PROVIDED that such
Bank's failure to give such notice shall not affect the validity
of such offset. Payments by any Borrower hereunder shall be made
without setoff or counterclaim.
Section 12.8. JURISDICTION; IMMUNITIES. (a) The Borrowers
hereby irrevocably submit to the jurisdiction of any New York
State or United States Federal Court sitting in New York City
over any action or proceeding arising out of or relating to this
64
Agreement or any Note or any other Facility Document, and each
Borrower hereby irrevocably agrees that all claims in respect of
such action or proceeding may be heard and determined in such New
York State or Federal court. The Borrowers irrevocably consent
to the service of any and all process in any such action or
proceeding by the mailing of copies of such process to the
Company at the Company's address specified on the signature pages
hereof. The Borrowers agree that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other
manner provided by law. The Borrowers further waive any
objection to venue in such state and any objection to an action
or proceeding in such state on the basis of forum NON CONVENIENS.
The Borrowers further agree that any action or proceeding brought
against the Agent shall be brought only in New York State or
United States Federal court sitting in New York County. Each of
the Borrowers, the Agent and each of the Banks waives any right
such Person may have to jury trial.
(b) Nothing in this Section 12.8 shall affect the right of
the Agent or any Bank to serve legal process in any other manner
permitted by law or affect the right of the Agent or any Bank to
bring any action or proceeding against any Borrower or any of
such Borrower's property in the courts of any other jurisdiction.
(c) To the extent that any Borrower has or hereafter may
acquire any immunity from jurisdiction of any court or from any
legal process (whether from service or notice, attachment prior
to judgment, attachment in aid of execution, execution or
otherwise) with respect to itself or its property, such Borrower
hereby irrevocably waives such immunity in respect of such
Borrower's obligations under this Agreement, and the Notes and
the other Facility Documents.
Section 12.9. JUDGMENT CURRENCY. If for the purpose of
obtaining judgment in any court it is necessary to convert a sum
due from any Borrower hereunder or under any of the Notes in
Dollars into another currency, the parties hereto agree, to the
fullest extent that they may effectively do so, that the rate of
exchange used shall be that at which in accordance with normal
banking procedures the Agent could purchase Dollars with such
other currency at the Agent's New York office on the Banking Day
preceding that on which final judgment is given. The obligations
of each Borrower in respect of any sum due to any Bank or the
Agent hereunder or under any Note or under any other Facility
Document shall, notwithstanding any judgment in a currency other
than Dollars, be discharged only to the extent that on the
Banking Day following receipt by such Bank or the Agent (as the
case may be) of any sum adjudged to be so due in such other
currency such Bank or the Agent (as the case may be) may in
accordance with normal banking procedures purchase Dollars with
such other currency; if the amount of Dollars so purchased is
65
less than the sum originally due to such Bank or the Agent, as
the case may be, in Dollars, the Borrowers agree, to the fullest
extent that they may effectively do so, as a separate obligation
and notwithstanding any such judgment, to indemnify such Bank or
the Agent, as the case may be, against such deficiency, and if
the amount of Dollars so purchased exceeds (a) the sum originally
due to any Bank or the Agent, as the case may be, and (b) any
amounts shared with other Banks as a result of allocations of
such excess as a disproportionate payment to such Bank under
Section 10.17, such Bank or the Agent, as the case may be, agrees
to remit such excess to the applicable Borrower.
Section 12.10. CONFIDENTIALITY. The Agent and each Bank
shall keep confidential any information provided by any Borrower
clearly identified as confidential; PROVIDED that nothing herein
shall prevent the Agent or any Bank from disclosing such
information (a) to its officers, directors, employees, agents,
attorneys and accountants in connection with the entry into and
administration of this Agreement and the extensions of credit
hereunder, (b) upon the order of a court or administrative
agency, (c) upon the request or demand of any regulatory agency
or authority having jurisdiction over such party, (d) which has
become publicly available without breach of any agreement among
the parties hereto, (e) as necessary for the exercise of any
remedy hereunder or under any Note, or (f) subject to provisions
similar to those contained in this Section 12.10, to any
participant or assignee or prospective participant or assignee.
Section 12.11. TABLE OF CONTENTS; HEADINGS. Any table of
contents and the headings and captions hereunder are for
convenience of reference only, are not a part of this Agreement
and shall not affect the interpretation or construction of this
Agreement.
Section 12.12. SEVERABILITY. The provisions of this
Agreement are intended to be severable. If for any reason any
provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction, such
provision shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any
other jurisdiction or the remaining provisions hereof in any
jurisdiction.
Section 12.13. COUNTERPARTS. This Agreement may be
executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing any such
counterpart.
Section 12.14. INTEGRATION. Except as set forth in
Section 2.14, the Facility Documents set forth the entire
66
agreement among the parties hereto relating to the transactions
contemplated thereby and supersede any prior oral or written
statements or agreements with respect to such transactions.
Section 12.15. GOVERNING LAW. This Agreement shall be
governed by, and interpreted and construed in accordance with,
the law of the State of New York.
[The Remainder of This Page Has Been Left Intentionally Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the day and year first above written.
MacDERMID, INCORPORATED
By___________________________
Name:
Title:
Address for Notices:
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attn: Corporate Secretary
MacDERMID IMAGING
TECHNOLOGY, INC.
By______________________________
Name:
Title:
Address for Notices:
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attn: President
AGENT:
THE CHASE MANHATTAN BANK, N.A.
By______________________________
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
Address for Notices:
Xxxxx X. Xxxxxxxxx
The Chase Manhattan Bank, N.A.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Xxxx Xxxxxxx
The Chase Manhattan Bank, N.A.
0 Xxxxx Xxxxxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
BANKS:
THE CHASE MANHATTAN BANK, N.A.
By______________________________
Name: Xxxxx Xxxxxxxxx
Title: Vice President
Lending Office for Variable Rate
Loans:
The Chase Manhattan Bank, N.A.
Xxx Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Lending Office for Eurocurrency
Loans:
The Chase Manhattan Bank, N.A.
Nassau Branch c/o
Eurocurrency Operations
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Address for Notices:
Xxxxx Xxxxxxxxx
The Chase Manhattan Bank of
Connecticut, N.A.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Xxxx Xxxxxxx
The Chase Manhattan Bank, N.A.
0 Xxxxx Xxxxxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
