EXHIBIT 4.9
EXECUTION COPY
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U.S. $75,000,000
CREDIT AGREEMENT
Dated as of April 2, 2004
among
VITROCRISA COMERCIAL, S. de X.X. de C.V., as Borrower,
VITROCRISA, S. de X.X. de C.V., as Guarantor,
VARIOUS FINANCIAL INSTITUTIONS,
BANK OF MONTREAL, as the Administrative Agent,
and
HSBC BANK USA and HSBC Mexico, S.A., Institucion de Banca Multiple, Grupo
Financiero HSBC, as the Collateral
Agents
Arranged by
XXXXXX XXXXXXX
and
BANCO NACIONAL DE MEXICO, S.A.,
as Joint Lead Arrangers
Syndicated by
XXXXXX XXXXXXX
and
BANCO NACIONAL DE MEXICO, S.A.,
as Syndication Agents
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CREDIT AGREEMENT, dated as of April 2, 2004, among VITROCRISA COMERCIAL,
S. de X.X. de C.V., a corporation (sociedad de responsabilidad limitada de
capital variable) organized and existing under the laws of the United Mexican
States ("Comercial"), VITROCRISA, S. de X.X. de C.V., a corporation (sociedad
de responsabilidad limitada de capital variable) organized and existing under
the laws of the United Mexican States ("Vitrocrisa"), and the financial
institutions listed in Schedule I hereto (each, a "Lender" and collectively,
the "Lenders"), BANK OF MONTREAL, as the administrative agent (in such
capacity the "Administrative Agent"), HSBC BANK USA and HSBC Mexico, S.A.,
Institucion de Banca Multiple, Grupo Financiero HSBC ("HSBC Mexico, S.A."), as
the collateral agents (in such capacity collectively, the "Collateral
Agents"), and XXXXXX XXXXXXX, as the Arranger (in such capacity "Arranger").
W I T N E S S E T H:
WHEREAS, Comercial desires to obtain commitments from the Lenders
pursuant to which loans will be made to Comercial and the Lenders are willing,
on the terms and subject to the conditions herein set forth to extend such
commitments and make such loans to Comercial as herein specifically set forth;
NOW, THEREFORE, in consideration of the premises and mutual
agreements hereinafter contained, the parties hereto hereby agree as follows:
Section 1. Definitions and Principles of Construction.
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Accelerated Product Payment Agreement" shall mean that certain
accelerated product payment agreement of even date herewith executed by Crisa
Ltd. and Comercial in substantially the form of Exhibit Q, as the same may be
amended, supplemented, restated or otherwise modified and in effect from time
to time.
"Acceptable Bank" shall have the meaning provided in Section
9.13(b).
"Acceptable Letter of Credit" shall have the meaning provided in
Section 9.13(b).
"Account Banks" shall mean Comerica Bank, Citibank, and Laredo
National Bank.
"Account Control Agreement" shall mean each of those certain account
control agreements of even date herewith entered into among the Collateral
Agent, the US Affiliates and the Account Banks, with respect to the deposit
accounts of the US Affiliates existing on the Closing Date, as amended,
supplemented, restated or otherwise modified and in effect from time to time.
1
"Accounts Receivable Report" shall mean a report substantially in
the form of Exhibit G which shall contain details including, but not limited
to, currency of payment, buyer names and payment terms, including aging of
receivables and breakdown of transactions permitted under Section 8.6.
"Additional Costs" shall have the meaning provided in Section 4.4.
"Administrative Agent" shall have the meaning provided in the first
paragraph of this Agreement and shall include its successors including each
other Person as shall have been subsequently been appointed as the successor
Administrative Agent pursuant to Section 11.
"Administrative Agent Fee Letter" means that certain letter
agreement dated April 2, 2004 among Vitrocrisa, Comercial, the Administrative
Agent and the Arranger (including the annexes and exhibits thereto), as from
time to time amended, supplemented, restated or modified and in effect from
time to time.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if such Person possesses, directly or indirectly, the power either (a)
to vote 10% or more of the securities or equity interest having ordinary
voting power for the election of directors of such Person, or (b) to direct or
cause the direction of the management and policies of such other Person,
whether through the ownership of voting securities (or equity interests), by
contract or otherwise.
"Agent" shall mean each of the Administrative Agent and the
Collateral Agents.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented or amended from time to time in accordance with its terms.
"Applicable Margin" shall mean (i) in the case of Tranche A Loans,
the Tranche A Applicable Margin, and (ii) in the case of Tranche B Loans, the
Tranche B Applicable Margin.
"Arranger" shall have the meaning provided in the first paragraph of
the Agreement.
"Bankruptcy Code" shall mean the Ley de Concursos Mercantiles of
Mexico or any other law or provision dealing with insolvency matters in Mexico
or Title 11 of the United States Code, as amended from time to time and any
successor statute thereto.
"Base Rate" shall mean the rate of Xxxxxx Bank Trust & Savings which
appears on the Telerate Page 41 from time to time as its base rate, the Base
Rate to change when and as such base rate changes. The Base Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. Any Lender may make commercial loans or
other loans at rates of interest at, above or below the Base Rate.
"Base Rate Loan" shall mean a Loan that bears interest based on the
Base Rate.
2
"Base Rate Note" means a promissory note (xxxxxx), in substantially
the form of Exhibit B-1 in the case of a note evidencing Tranche A Term Loans,
Exhibit B-3 in the case of a note evidencing Tranche A Revolving Notes, and
Exhibit B-5 in the case of a note evidencing Tranche B Loans, in each case
executed by Comercial (and signed por aval by Vitrocrisa and in the case of a
Base Rate Note evidencing a Tranche A Loan also signed por aval by Vitro) in
favor of each relevant Lender.
"BMO" shall mean Bank of Montreal.
"Borrowing" shall mean the borrowing of Loans from the Lenders on
any Borrowing Date.
"Borrowing Date" shall mean each date occurring on or after the
Closing Date on which a Borrowing hereunder occurs.
"Business Day" shall mean any day except Saturday, Sunday and any
day which shall not be in New York, London or Mexico City a legal holiday or a
day on which banking institutions are authorized or required by law or other
government action to close.
"Capitalized Lease" means any lease of property, real or personal,
or similar arrangement, the obligations of the lessee in respect of which are
required in accordance with GAAP to be capitalized on a balance sheet of the
lessee.
"Capitalized Lease Liabilities" of any Person, means all monetary
obligations of such Person or any of its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, would be classified as
Capitalized Leases, and, for purposes of this Agreement and each other
Transaction Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP, and the stated maturity
thereof shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
"Cash Collateral Account" shall have the meaning provided in Section
7.19(b).
"Cash Equivalents" shall mean, as to any Person, (i)
dollar-denominated securities issued or directly and fully guaranteed or
insured by the United States or any Government Agency thereof (provided, that
the full faith and credit of the United States is pledged in support thereof)
having maturities of not more than six months from the date of acquisition,
(ii) dollar-denominated time deposits or certificates of deposit of any
commercial bank, or principal banking subsidiary of a bank holding company, in
any such case incorporated in the United States of recognized standing and
having a long-term unsecured debt rating of at least "A" or the equivalent
thereof from Standard & Poor's, a division of the McGraw Hill Companies, or
"A2" or the equivalent thereof from Xxxxx'x Investors Service, Inc., (iii)
dollar-denominated repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clause (i) above
entered into with any bank meeting the qualifications specified in clause (ii)
above, (iv) commercial paper issued by any Person incorporated in (x) the
United States rated at least A-1 or the equivalent by Standard & Poor's, a
division of the McGraw Hill Companies, or at least P-1 or the equivalent
thereof by Xxxxx'x Investor Service,
3
Inc. or (y) Mexico rated at least investment grade in Dollars by Fitch, Inc.,
and in each case of clause (x) and (y), maturing not more than six months
after the date of acquisition by such Person, (v) Certificados de la Tesoreria
de la Federacion (Cetes) or Bonos de Desarrollo del Gobierno Federal (Bondes)
issued by the Mexican government and maturing not more than 180 days after the
acquisition thereof, (vi) investments in money market funds substantially all
of whose assets are comprised of securities of the types described in clauses
(i) through (v) above, (vii) demand deposit accounts maintained in the
ordinary course of business, and (viii) certificates of deposits, bank
promissory notes and bankers' acceptances denominated in Pesos, maturing not
more than 180 days after the acquisition thereof and issued or guaranteed by
any one of the five largest banks (based on assets as of the immediately
preceding December 31) organized under the laws of Mexico and which are not
under intervention or controlled by the Comision Nacional Bancaria y de
Valores (CNBV) or by the Instituto de Proteccion al Ahorro Bancario (IPAB) or
any successor thereto.
"Change in Control" shall mean any of the following:
(i) either Vitro or Libbey shall own, directly or indirectly,
beneficially or of record, less than 40.0% of the issued and outstanding
voting equity of Vitrocrisa or Comercial; or
(ii) either Vitro or Libbey shall own, directly or indirectly,
beneficially or of record, more than 60.0% of the issued and outstanding
voting equity of Vitrocrisa or Comercial; or
(iii) Vitro and Libbey, together, shall cease to own, directly or
indirectly, beneficially or of record, less than 100.0% of the issued and
outstanding voting equity of Vitrocrisa or Comercial; or
(iii) either Vitro or Libbey shall cease to control, directly or
indirectly, the power to direct or cause the direction of the management
and policies of Vitrocrisa, whether through the ownership of voting
securities, by contract or otherwise or Comercial; or
(iv) in the event that Vitro or Libbey (or the Person(s) through
which either Vitro or Libbey own the equity) have pledged any of the
voting equity of Vitrocrisa or Comercial to any other Person, there shall
occur any default under the agreement(s) pursuant to which such pledge
was made.
"Clean Down Period" shall have the meaning provided in Section
4.2.3(c).
"Closing Date" shall mean the date hereof.
"Collateral Agent" shall have the meaning provided in the first
paragraph of this Agreement and shall include their respective successors
including each other Person as shall have been subsequently been appointed as
the successor Collateral Agent pursuant to Section 11.
"Collateral Agent Fee Letter" means that certain letter agreement
dated April 2, 2004 among Vitrocrisa, Comercial and the Collateral Agents
(including the annexes and exhibits thereto).
4
"Collateral Documents" means the Security Agreement, the US
Affiliate Security Agreements, the Non-Possessory Pledge Agreement, and the
Consents.
"Combined Operating Cash Flow" of any Person as of any date shall
mean the sum of (i) operating income, (ii) depreciation and amortization and
(iii) other non-cash charges to the extent deducted in the process of arriving
at the operating income, in each case determined on a consolidated basis
together with its Consolidated Subsidiaries in accordance with GAAP, all such
items for the twelve months ending on such date.
"Comercial" shall have the meaning provided in the first paragraph
of this Agreement.
"Commitment" shall mean for each Lender, its Tranche A Commitment
and its Tranche B Commitment, in each case, if any.
"Commitment Fee" shall have the meaning provided in Section 3.1.
"Consents" means each of those certain consents of even date
herewith executed by Libbey Glass, Sunbeam Products, Xxxxxxxx Beach, Simatelex
Manufactory Company Limited, Xxxxx Xxxx China Enterprise LTD, Whirlpool
Corporation, Conair Corporation, Sunbeam Latin America, Inc., Grupo Segma SPA
and Siemens PT & D arising from or related to exports made directly or
indirectly by Comercial, in substantially the form of Exhibit M hereto and the
consent from the payee of the Intercompany Note referenced in Section 5.1.11,
as the same may be amended, supplemented, restated or otherwise modified from
time to time.
"Consolidated Assets" of any Person means the sum obtained by adding
the Consolidated Current Assets and the amount of all other assets of such
Person, all as determined in accordance with GAAP.
"Consolidated Capital Expenditures" of any Person means, as of any
date, the aggregate amount of all expenditures of such Person and its
Consolidated Subsidiaries for fixed or capital assets made during the twelve
(12) month period ending on such date which, in accordance with GAAP, would be
classified as capital expenditures.
"Consolidated Current Assets" of any Person means the aggregate (as
of the relevant date of calculation) of such Person's and its Consolidated
Subsidiaries' cash, marketable securities, trade and other receivables
realizable within one year, and inventories and prepaid expenses and other
current assets, all as determined in accordance with GAAP.
"Consolidated Current Liabilities" means the aggregate (as of the
relevant date of calculation) of such Person's and its Consolidated
Subsidiaries' liabilities falling due on demand or within one year, all as
determined in accordance with GAAP.
"Consolidated Gross Interest Expense" of any Person, as of any date,
shall mean the aggregate amount of interest payable upon such Person's and its
Consolidated Subsidiaries' total outstanding Indebtedness for the twelve (12)
month period ending on such date.
5
"Consolidated Indebtedness" of any Person shall mean, as of any date
of determination, the aggregate consolidated Indebtedness of such Person and
its Consolidated Subsidiaries, as determined in accordance with GAAP.
"Consolidated Liabilities" of any Person means the sum obtained by
adding the Consolidated Current Liabilities and all other liabilities of such
Person and its Consolidated Subsidiaries, all as determined in accordance with
GAAP.
"Consolidated Net Income" of any Person for any period means the
consolidated net income of such Person and its Consolidated Subsidiaries for
such period, as determined in accordance with GAAP.
"Consolidated Net Worth" of any Person, at any date, means the
difference between (x) Consolidated Assets and (y) Consolidated Liabilities,
of such Person and its Consolidated Subsidiaries.
"Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with GAAP.
"Crisa Industrial" means Crisa Industrial, L.L.C., a Delaware
limited liability company.
"Crisa Ltd." means Crisa Texas Limited, LP (d/b/a Crisa Ltd.), a
Texas limited partnership.
"Default" shall mean any Event of Default or any event, act or
condition which, with notice or lapse of time, or both, would constitute an
Event of Default.
"Defaulting Guarantor" shall have the meaning provided in Section
9.13(a).
"Derivative Obligation" shall mean, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or without
recourse, with respect to Hedge Agreements. The amount of any Derivative
Obligation, as of any date of determination, shall be deemed equal to the fair
xxxx-to-market value as of the last day of the most recent fiscal quarter
ending on or before such date of determination.
"Dollars" and the sign "$" shall mean freely transferable lawful
money of the United States.
"Effective Date" shall mean the first Business Day occurring on or
after the Closing Date when all conditions to the initial Borrowing are
satisfied.
"Environmental Laws" means any and all applicable federal, national,
state and local treaties, laws, regulations, "normas tecnicas" or other
governmental restrictions of any applicable Government Agency relating to the
environment or to emissions, discharges or releases of pollutants,
contaminants, petroleum products, chemicals or industrial, toxic or hazardous
substances or wastes into the environment.
6
"Eurodollar Reserve Percentage" means, for any Borrowing of LIBOR
Loans, the daily average for the applicable Interest Period of the maximum
rate, expressed as a decimal, in which reserves (including, without
limitation, any supplemental, marginal and emergency reserves) are imposed
during such Interest Period by the Board of Governors of the Federal Reserve
System (or any successor) on "eurocurrency liabilities," as defined in such
Board's Regulation D (or in respect of any other category of liabilities that
includes the deposits by reference to which the interest rate on LIBOR Loans
is determined or any category of extensions of credit or other assets that
include loans by non-United States offices of any Lender to United States
residents), subject to any amendments of such reserve requirements by such
Board or its successor, taking into account any transitional adjustments
thereto. For purposes of this definition, the LIBOR Loans shall be deemed to
be "eurocurrency liabilities" as defined in Regulation D without benefit or
credit for any prorations, exemptions or offsets under Regulation D.
"Event of Default" shall have the meaning provided in Section 9.
"Excess Cash Flow Amount" shall have the meaning provided in Section
7.20(b).
"Excess Cash Flow Prepayment" shall have the meaning provided in
Section 7.20(a).
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.
"Final Maturity Date" shall mean (i) in the case of Tranche A Term
Loans, April 2, 2009, (ii) in the case of the Tranche A Revolving Loans, the
Tranche A Revolving Commitment Termination Date, and (iii) in the case of
Tranche B Term Loans, April 2, 2007.
"GAAP" means, Mexican generally accepted accounting principles as in
effect from time to time applied on a basis consistent with those applied in
the preparation of then-most recent audited consolidated financial statements
of the relevant Person and its Consolidated Subsidiaries delivered to the
Lenders (except for changes concurred in by such Person's independent
auditors).
"Government Agency" shall mean any ministry, administrative
department, agency, commission, bureau, board, regulatory authority, registry,
instrumentality, governmental body, entity, judicial or administrative body or
court (including, without limitation, banking and taxing authorities) of, or
controlled by, as the case may be, Mexico or the United States or any
political subdivision thereof.
"Governmental Approval" shall mean any authorization, approval,
consent, license, concession, ruling, permit, tariff, rate, certification,
order, validation, exemption, waiver, variance, opinion of, or registration,
filing or recording with, any applicable Government Agency.
"Guaranteed Obligations" shall have the meaning provided in Section
10.1.
"Guarantor" shall mean each Person who has executed a Guaranty.
7
"Guarantor Event of Default" shall mean, (a) collectively, (i) a
Guarantor Event of Default as defined in the Libbey Guaranty, (ii) a Guarantor
Event of Default as defined in the Vitro Guaranty, (iii) a Guarantor Event of
Default as defined in any US Affiliate Guaranty, and (iv) a Guarantor Event of
Default as defined in any Subsidiary Guaranty, and (b) individually, any of
the foregoing.
"Guaranty" shall mean any of the Libbey Guaranty, Vitro Guaranty, or
any US Affiliate Guaranty or Subsidiary Guaranty, as amended, supplemented,
restated or otherwise modified and in effect from time to time.
"Hedge Agreement" shall mean any interest rate exchange agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging agreement.
"HSBC Mexico, S.A." shall have the meaning provided in the first
paragraph of the Agreement.
"Indebtedness" as applied to any Person, means (i) all indebtedness
for borrowed money, (ii) that portion of obligations with respect to
capitalized leases or Capitalized Lease Liabilities which is properly
classified as a liability on a balance sheet of such Person in conformity with
GAAP, (iii) notes payable and drafts accepted representing extensions of
credit, (iv) any interest-bearing obligation owed for all or any part of the
deferred purchase price of property or services which purchase price is (a)
due more than six months from the date of incurrence of the obligation in
respect thereof, or (b) evidenced by a note or similar written instrument, (v)
any preferred, preference, special or similar stock of any Person which is not
entitled to share in a distribution without limitation of amount in the event
of a liquidation of such Person and which is not convertible or redeemable
into common stock of such Person, (vi) all guarantees, make-whole, keep well
or similar arrangements pursuant to which such Person has agreed to be liable
or responsible for or on account of any Indebtedness of any other Person
described in the other clauses of this definition, (vii) all Indebtedness
secured by any Lien on any property or asset owned or held by such Person,
irrespective of whether the Indebtedness secured thereby shall have been
assumed by such Person or is nonrecourse to the credit of such Person, and
(viii) all Derivative Obligations of such Person.
"Indebtedness to be Paid" shall have the meaning provided in Section
5.1.9.
"Intercompany Note" shall mean that certain intercompany note of
even date herewith executed by Comercial payable to the order of Servicios y
Operaciones Financieras Vitro in the principal amount set forth in Section
5.1.11 and in substantially the form of Exhibit I, as the same may be amended,
supplemented, restated or otherwise modified and in effect from time to time.
"Interest Determination Date" shall mean, with respect to any LIBOR
Loan, the second Business Day prior to the commencement of any Interest Period
relating to such LIBOR Loan.
"Interest Period" shall mean the interest period set forth in
respect of LIBOR Loans in Section 2.7(a).
8
"Investments" shall have the meaning set forth in Section 8.4.
"Law" shall mean any constitution, treaty or convention, statute,
law, code, act, ordinance, decree, order, injunction, rule, regulation,
resolution, guideline, interpretation, direction, policy, restriction or
request (whether or not in any such case having the force of law), or
judicial, administrative or arbitral decision.
"Lender" shall have the meaning provided in the first paragraph of
this Agreement, subject to Section 12.5(a) hereof.
"Lender Assignment Agreement" shall have the meaning set forth in
Section 12.5.
"Lending Office" shall mean, with respect to each Lender, the office
of such Lender specified as its "Lending Office" opposite its name on Schedule
II or such other office, Subsidiary or Affiliate of such Lender as such Lender
may from time to time specify as such to Comercial and the Administrative
Agent.
"Libbey" means Libbey Inc., a Delaware corporation.
"Libbey Collection Accounts" shall mean each of the Libbey
Collection Account and each Related Account as such terms are defined in that
certain US Affiliate Security Agreement, dated as of the date hereof, made by
Crisa Ltd. in favor of the Collateral Agent for the Lender Parties (as defined
therein).
"Libbey Glass" means Libbey Glass Inc., a Delaware corporation.
"Libbey Guaranty" shall mean that certain Guaranty executed by
Libbey and Libbey Glass dated the date hereof in substantially the form of
Exhibit J, as the same may be amended, supplemented, restated or otherwise
modified from time to time.
"Libbey Receivables" means accounts receivable payable by Libbey or
any Affiliate of Libbey to Comercial or the US Affiliates.
"LIBOR" shall mean, with respect to each Interest Period for LIBOR
Loans, (i) the rate which appears on the Telerate Page 3750 (the "Telerate
Page") (rounded upward to the next whole multiple of 1/16th of 1%) at 11:00
a.m. (London time) for deposits in Dollars comparable to the outstanding
principal amount of the Loans with maturities comparable to such Interest
Period; provided, that if the Telerate Page is not available or if no such
rate is quoted for the relevant Interest Period, then LIBOR shall mean the
average of the rates which appear on the Reuters Screen LIBO Page (the "LIBO
Page"); and, if the LIBO Page is not available or if no such rate is quoted
for the relevant Interest Period, then LIBOR shall mean the average of the
offered quotations to two leading banks in London for Dollar deposits of
amounts comparable to the outstanding principal amount of the Loan for which
an interest rate is then being determined with maturities comparable to the
Interest Period to be applicable to such Loan (in each such case rounded
upward to the next whole multiple of 1/16th of 1%), determined as of 10:00
A.M. (New York time) on the date which is two Business Days prior to the
commencement of such Interest Period, divided by (ii) a percentage equal to
100% minus the Eurodollar Reserve Percentage.
9
"LIBOR Loan" shall mean a Loan that bears interest based on LIBOR.
"LIBOR Note" means a promissory note (xxxxxx), in substantially the
form of Exhibit B-2 in the case of a note evidencing Tranche A Term Loans,
Exhibit B-4 in the case of a note evidencing Tranche A Revolving Loans, and
Exhibit B-6 in the case of a note evidencing Tranche B Loans, in each case
executed by Comercial (and signed por aval by Vitrocrisa and in the case of
any note evidencing a Tranche A Loan also signed por aval by Vitro) in favor
of each relevant Lender.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment
for security purposes, deposit arrangement, encumbrance, lien (statutory or
other), charge, option, right of first refusal, right of use or occupancy,
"fideicomiso", "xxxxxxx" preference, priority or other security agreement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any financing or similar statement or
notice filed under any recording or notice statute, and any lease having
substantially the same effect as any of the foregoing or any other arrangement
having the same effect as any of the foregoing).
"Loan" shall mean any Tranche A Term Loan, Tranche A Revolving Loan
or Tranche B Loan.
"Margin Stock" shall have the meaning provided in Regulation U of
the Board of Governors of the Federal Reserve System.
"Material Adverse Effect" shall mean, with respect to any Person,
(i) any material adverse effect on the condition (financial or otherwise),
business, operations, assets, liabilities (contingent or otherwise), revenues,
properties or prospects of such Person and, unless the context indicates
otherwise, such Person's Consolidated Subsidiaries, taken as a whole, (ii) any
material adverse effect on the ability of such Person to perform any of its
obligations under any Transaction Document to which it is a party, and/or
(iii) any material adverse effect on the rights and/or remedies of the
Administrative Agent, the Collateral Agent (in such capacity) and/or any
Lender hereunder or under any of the other Transaction Documents.
"Mexico" shall mean the United Mexican States and any political
subdivision thereof.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. and any
successor thereto that is a nationally recognized rating agency.
"Non-Possessory Pledge Agreement" shall mean that certain
Non-Possessory Pledge Agreement, dated of even date herewith, executed by
Comercial and HSBC Mexico, S.A., as the collateral agent in substantially the
form of Exhibit P hereto, as the same may be amended, supplemented, restated
or otherwise modified and in effect from time to time.
"Note" shall mean with respect to a Base Rate Loan, a Base Rate
Note, and with respect to a LIBOR Loan, a LIBOR Note.
"Notice of Borrowing" shall have the meaning provided in Section
2.2.
10
"Notice Office" shall mean, with respect to the Administrative
Agent, the office of the Administrative Agent located at 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or such `other office as the Administrative
Agent may hereafter designate in writing as such to the other parties hereto,
and with respect to the Collateral Agent, (i) if to HSBC Bank, N.A., (ii) if
to HSBC Mexico, S.A., Av. Xxxxxx 470 Pte Primer Piso Zona Centro, Monterrey,
Nuevo Xxxx, and (iii) if to HSBC Bank USA, to the office of the Collateral
Agent located at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other
office as the Collateral Agent may hereafter designate in writing as such to
the other parties hereto.
"Obligations" shall mean all present and future obligations,
liabilities and other amounts owing to the Administrative Agent or any Lender
pursuant to the terms of this Agreement or any other Transaction Document.
"Other Transactions" means, with respect to any twelve-month period,
(i) all cash payments made during such period relating to retirement and
pensions for employees, (ii) all cash payments made during such period
relating to the severance of employees who are not replaced, (iii) other
income or losses (on a net basis) derived from activities other than the main
business activities of Comercial and Vitrocrisa, and (iv) exchange rate
variations resulting in the revaluation or devaluation of accounts receivable
and accounts payable denominated in any currency other than Pesos, in each
case to the extent not otherwise included in determining Combined Operating
Cash Flow for such period.
"Payment Office" shall mean the office of the Administrative Agent
located at 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, XX 00000, or such other office
as the Administrative Agent may hereafter designate in writing as such to the
other parties hereto.
"Permitted Liens" shall have the meaning provided in Section 8.1.
"Person" shall mean any individual, partnership, limited
partnership, joint venture, firm, corporation, association, trust, estate or
other enterprise or any government or political subdivision or any agency,
department or instrumentality thereof.
"Peso" shall mean the lawful currency of Mexico.
"Process Agent" shall mean CT Corporation System, presently located
at 000 0xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Required Lenders" shall mean at any time with respect to any action
the Lenders, whose consent is required with respect to such action pursuant to
Section 12.14 hereof.
"Required Reserve Amount" shall have the meaning provided in Section
7.18.
"Required Tranche A Lenders" means at any time the Lenders holding
more than 50% of the sum of the then aggregate unpaid principal amount of the
Tranche A Loans and the Tranche A Total Commitment.
"Required Tranche A Revolving Lenders" means, at any time, Lenders
holding more than 66 2/3% of the then aggregate amount of the Tranche A
Revolving Commitments.
11
"Required Tranche B Lenders" means at any time the Lenders holding
more than 50% of the then aggregate unpaid principal amount of the Tranche B
Loans or, if no such principal amount is then outstanding, Lenders holding
more than 50% of the Tranche B Total Commitment.
"Reserve Account" shall have the meaning provided in Section 7.18.
"S&P" shall mean Standard and Poor's and any successor thereto that
is a nationally recognized rating agency.
"Scheduled Repayment Date" means (i) the Tranche A Term Scheduled
Repayment Date in the case of Tranche A Term Loans, and (ii) the Tranche B
Scheduled Repayment Date in the case of Tranche B Loans.
"Secured Obligations" means the Tranche A Obligations and any
Derivative Obligations owed to a Lender or its successors or assigns under a
Hedge Agreement entered into pursuant to Section 8.3(d).
"Security Agreement" means that certain security agreement executed
by Comercial in substantially the form of Exhibit L hereto , as amended,
supplemented, restated or otherwise modified and in effect from time to time.
"Servicios y Operaciones Financieras Vitro" means Servicios y
Operaciones Financieras Vitro, S.A. de C.V., a corporation (sociedad anonima
de capital variable) organized and existing under the laws of Mexico.
"SHCP" shall have the meaning provided in Section 4.4.
"Short Term Investments" shall have the meaning provided in Section
8.4(c).
"Solvent" shall mean (a) with respect to any Person organized under
Mexican law, including without limitation, Comercial, Vitrocrisa and Vitro
that, as of any date of determination, Comercial or Vitrocrisa have not
defaulted on payment of at least two different creditors: (i) for obligations
that have been due for at least 30 days, which represent at least 35% of all
obligations owed by either Comercial or Vitrocrisa, as the case may be; and,
(ii) that Comercial and Vitrocrisa do have assets to cover at least 80% of its
due obligations, as defined in article 10 of the Mexican Commercial Insolvency
Law (Ley de Concursos Mercantiles); and (b) when used with respect to any
Person organized under the laws of the U.S. or any state of the U.S.,
including each US Affiliate and Libbey that, as of any date of determination,
(a) the amount of the "present fair saleable value" of the assets of such
Person will, as of such date, exceed the amount of all "liabilities of such
Person, contingent or otherwise", as of such date, as such quoted terms are
determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable
value of the assets of such Person will, as of such date, be greater than the
amount that will be required to pay the liability of such Person on its debts
as such debts become absolute and matured, (c) such Person will not have, as
of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they
mature. For purposes of this definition, (i) "debt" means liability on a
"claim", and (ii) "claim" means any (x) right to
12
payment, whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured or (y) right to an equitable remedy for
breach of performance if such breach gives rise to a right to payment, whether
or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.
"Subsidiary" of any Person means any other Person, (i) of which (or
in which) greater than 50% of (A) the outstanding capital stock of any class
or classes having ordinary voting power to elect a majority of the board of
directors of such second Person, if a corporation, (B) the interest in the
capital or profits of such second Person, if a partnership or other entity, or
(C) the beneficial interest of such trust or estate, if a trust or estate, is
at the time directly or indirectly owned by such first Person, by such first
Person and one or more other Subsidiaries of such first Person, or by one or
more other Subsidiaries of such first Person; (ii) which is otherwise
effectively controlled by such first Person or any other Subsidiary of such
first Person, pursuant to contract, arrangement, understanding or otherwise;
or (iii) any other corporation, association or other business entity that is
required by GAAP to be combined or consolidated with such Person.
"Subsidiary Guaranty" means the unconditional guaranty of the
Subsidiaries of Vitrocrisa and/or Comercial in substantially the form of
Exhibit H hereto, as such guaranty may be amended, supplemented, restated or
otherwise modified from time to time.
"Supermajority Lenders" shall mean, at any time, Lenders holding 66
2/3% or more of the then aggregate unpaid principal amount of the Loans and
the unused Total Commitment; provided that such Lenders shall include at least
one Lender having outstanding Tranche A Loans or a Tranche A Term Commitment
or Tranche A Revolving Commitment and one Lender having outstanding Tranche B
Loans or a Tranche B Commitment.
"Total Commitment" shall mean, at any time, the sum of the Tranche A
Total Commitments and the Tranche B Total Commitments of all the Lenders.
"Tranche A Applicable Margin" means at any time:
(a) for any date during the period from the Closing Date to (but not
including) the first anniversary of the Closing Date, 2.75% per annum
with respect to Tranche A LIBOR Loans and 1.75% per annum with respect to
Tranche A Base Rate Loans;
(b) for any date during the period from the first anniversary of the
Closing Date to (but not including) the second anniversary of the Closing
Date, 2.875% per annum with respect to Tranche A LIBOR Loans and 1.875%
per annum with respect to Tranche A Base Rate Loans;
(c) for any date during the period from the second anniversary of
the Closing Date to (but not including) the third anniversary of the
Closing Date, 3.00% per annum with respect to Tranche A LIBOR Loans and
2.00% per annum with respect to Tranche A Base Rate Loans;
13
(d) for any date during the period from the third anniversary of the
Closing Date to (but not including) the fourth anniversary of the Closing
Date, 3.125% per annum with respect to Tranche A LIBOR Loans and 2.125%
per annum with respect to Tranche A Base Rate Loans; and
(e) for any date during the period from the fourth anniversary of
the Closing Date and thereafter, 3.25% per annum with respect to Tranche
A LIBOR Loans and 2.25% per annum with respect to Tranche A Base Rate
Loans;
provided, that if on any quarterly report delivered pursuant to Section 7.1(a)
(other than a quarterly report delivered in respect of a quarter ended prior
to the date six months following the Closing Date) the ratio of Consolidated
Indebtedness to Combined Operating Cash Flow (determined on a combined basis
for Vitrocrisa and Comercial) as of the last day of the quarter to which such
quarterly report relates (i) is equal to or less than 2.5:1.0, then the
Tranche A Applicable Margin shall be 0.25% lower than the Tranche A Applicable
Margin otherwise applicable during such time period from and after the first
day of the quarter immediately following the receipt by the Administrative
Agent of the relevant quarterly report, and (ii) is equal to or less than
1.75:1.0, then the Tranche A Applicable Margin shall decrease by 0.25% (in
addition to the 0.25% referred to in clause (i) above) from and after the
first day of the quarter immediately following the receipt by the
Administrative Agent of the relevant quarterly report; further, provided, that
any decrease in the Tranche A Applicable Margin as a result of the immediately
preceding proviso shall remain in effect only for any quarter for which the
ratio of Consolidated Indebtedness to Combined Operating Cash Flow (such ratio
to be determined on a combined basis for Vitrocrisa and Comercial), as of the
last day of the immediately preceding quarter, is equal to or less than the
relevant corresponding ratio specifically referenced in clauses (i) or (ii),
as applicable, of this proviso.
"Tranche A Commitment" means either a Tranche A Term Commitment or a
Tranche A Revolving Commitment.
"Tranche A Lender" means any Lender that holds Tranche A Loans or
Tranche A Commitments.
"Tranche A Loans" means, with respect to each Lender, its Tranche A
Revolving Loans and its Tranche A Term Loans.
"Tranche A Notes" means the Tranche A Term Notes and the Tranche A
Revolving Notes.
"Tranche A Obligations" means all Obligations of Vitrocrisa and/or
Comercial to each of the Tranche A Lenders and the Agents relating to the
Tranche A Loans or the Tranche A Commitments, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, or due or to become due, which arise out of or in
connection with this Agreement or any other Transaction Document, in each case
as the same may be amended, supplemented, restated, extended, renewed or
otherwise modified from time to time.
14
"Tranche A Revolving Commitment" means, with respect to each Lender
at any time, its commitment to make Tranche A Revolving Loans to Comercial
pursuant to Section 2.1.2 hereof in a principal amount from time to time
outstanding not to exceed the amount set forth opposite such Lender's name in
Schedule I directly below the column entitled "Tranche A Revolving
Commitment", as may be reduced by voluntary prepayments applied to Tranche A
Term Loans pursuant to Section 4.1 or Excess Cash Flow Prepayments applied to
Tranche A Loans pursuant to Section 4.1.
"Tranche A Revolving Commitment Termination Date" shall mean the
third anniversary date of the Closing Date.
"Tranche A Revolving Loans" shall have the meaning provided in
Section 2.1.2.
"Tranche A Revolving Note" shall have the meaning provided in
Section 2.4.
"Tranche A Term Note" shall have the meaning provided in Section
2.4.
"Tranche A Term Commitment" means, with respect to each Lender at
any time, its commitment to make one Tranche A Term Loan to Comercial on the
Effective Date pursuant to Section 2.1.1 hereof in a principal amount equal to
the amount set forth opposite such Lender's name in Schedule I directly below
the column entitled "Tranche A Term Commitment" or in the relevant Lender
Assignment Agreement.
"Tranche A Term Loans" shall have the meaning provided in Section
2.1.1.
"Tranche A Term Scheduled Repayment" shall have the meaning provided
in Section 4.2.1.
"Tranche A Term Scheduled Repayment Date" shall have the meaning
provided in Section 4.2.1.
"Tranche A Total Commitment" means at any time the sum of the
Tranche A Revolving Commitment and the Tranche A Term Commitment of all the
Lenders.
"Tranche B Applicable Margin" means at any time:
(a) for any date during the period from the Closing Date to (but not
including) the first anniversary of the Closing Date, 2.00% per annum
with respect to Tranche B LIBOR Loans and 1.00% per annum with respect to
Tranche B Base Rate Loans;
(b) for any date during the period from the first anniversary of the
Closing Date to (but not including) the second anniversary of the Closing
Date, 2.125% per annum with respect to Tranche B LIBOR Loans and 1.125%
per annum with respect to Tranche B Base Rate Loans; and
(c) for any date during the period from the second anniversary of
the Closing Date and thereafter, 2.25% per annum with respect to Tranche
B LIBOR Loans and 1.25% per annum with respect to Tranche B Base Rate
Loans;
15
provided, that if on any quarterly report delivered pursuant to Section 7.1(a)
(other than a quarterly report delivered in respect of a quarter ended prior
to the date six months following the Closing Date) the ratio of Consolidated
Indebtedness to Combined Operating Cash Flow (determined on a combined basis
for Vitrocrisa and Comercial) as of the last day of the quarter to which such
quarterly report relates (i) is equal to or less than 2.5:1.0, then the
Tranche B Applicable Margin shall be 0.125% lower than the Tranche B
Applicable Margin otherwise applicable during such time period from and after
the first day of the quarter immediately following the receipt by the
Administrative Agent of the relevant quarterly report, and (ii) is equal to or
less than 1.75:1.0, then the Tranche B Applicable Margin shall decrease by
0.125% (in addition to the 0.125% referred to in clause (i) above) from and
after the first day of the quarter immediately following the receipt by the
Administrative Agent of the relevant quarterly report; further, provided, that
any decrease in the Tranche B Applicable Margin as a result of the immediately
preceding proviso shall remain in effect for any quarter for which the ratio
of Consolidated Indebtedness to Combined Operating Cash Flow (such ratio to be
determined on a combined basis for Vitrocrisa and Comercial), as of the last
day of the immediately preceding quarter, is equal to or less than the
relevant corresponding ratio specifically referenced in clauses (i) or (ii),
as applicable, of this proviso.
"Tranche B Commitment" shall mean for each Lender at any time, its
commitment to make one Tranche B Term Loan to Comercial on the Effective Date
pursuant to Section 2.1.3 hereof in a principal amount equal to the amount set
forth opposite such Lender's name in Schedule I directly below the column
entitled "Tranche B Commitment" or in the relevant Lender Assignment
Agreement.
"Tranche B Lender" means any Lender that holds Tranche B Loans or
Tranche B Commitments.
"Tranche B Loans" shall have the meaning provided in Section 2.1.3.
"Tranche B Note" shall have the meaning provided in Section 2.4.
"Tranche B Obligations" means all Obligations of Vitrocrisa and/or
Comercial to each of the Tranche B Lenders and the Administrative Agent
relating to the Tranche B Loans or the Tranche B Commitments, howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, which arise
out of or in connection with this Agreement or any other Transaction Document,
in each case as the same may be amended, supplemented, restated, extended,
renewed or otherwise modified from time to time.
"Tranche B Scheduled Repayment" shall have the meaning provided in
Section 4.2.2.
"Tranche B Scheduled Repayment Date" shall have the meaning provided
in Section 4.2.2.
"Tranche B Total Commitment" means at any time the sum of the
Tranche B Commitments of all the Lenders.
16
"Transaction Documents" means this Agreement, the Notes, the Libbey
Guaranty, the Vitro Guaranty, the Subsidiary Guaranties, the US Affiliate
Guaranties, the Collateral Documents, the Administrative Agent Fee Letter, the
Collateral Agent Fee Letter, the Non-Possessory Pledge Agreement, each Account
Control Agreement, each letter of credit delivered pursuant to this Agreement
and each document or instrument provided to be delivered by any Person
hereunder or thereunder or in connection herewith or therewith.
"Triggering Ratio" shall have the meaning provided in Section
7.19(a).
"United States" and "U.S." shall each mean the United States of
America.
"US Affiliate" means each of Crisa Ltd. and Crisa Industrial, and
their respective successors and permitted assigns.
"US Affiliate Guaranty" means each of those certain guaranties in
substantially the form of Exhibit N hereto, as amended, supplemented, restated
or otherwise modified and in effect from time to time.
"US Affiliate Security Agreement" means each of those certain
security agreements in substantially the form of Exhibit O hereto, as amended,
supplemented, restated or otherwise modified and in effect from time to time.
"Vitro" means Vitro, S.A. de C.V., a corporation (sociedad anonima
de capital variable) organized and existing under the laws of Mexico.
"Vitro Guaranty" shall mean that certain Guaranty executed by Vitro
dated the date hereof in substantially the form of Exhibit K, as the same may
be amended, supplemented, restated or otherwise modified from time to time.
"Vitrocrisa" shall have the meaning provided in the first paragraph
of this Agreement.
"Vitrocrisa Comercial Collection Account" shall mean (i) until the
Tranche A Loans are indefeasibly paid in full and the Tranche A Total
Commitments are terminated, that certain account number 000-00000-0, reference
Vitrocrisa Comercial Collection Account 10-878572 established with, and in the
name of, the Collateral Agent, and (ii) thereafter, such other account in the
name of the Borrower established with the Collateral Agent.
"Vitrocrisa Holding" means Vitrocrisa Holding, S. de X.X. de C.V., a
corporation (sociedad de responsabilidad limitada de capital variable)
organized and existing under the laws of Mexico.
1.2 Principles of Construction.
(a) All references to sections, schedules and exhibits are to
sections, schedules and exhibits in or to this Agreement unless otherwise
specified. The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement. The words
17
"including" or "include" shall mean "including, without limitation" and
"include, without limitation," respectively.
(b) All accounting terms not specifically defined herein shall be
construed in accordance with GAAP in conformity with those used in the
preparation of the financial statements described in Section 6.7(a).
Section 2. Amount and Terms of Loans.
2.1 The Loans. On the terms and subject to the conditions of this
Agreement (including Section 5), each Lender severally agrees to make Loans
pursuant to the commitments described in this Section 2.1.
2.1.1 The Tranche A Term Loans. Subject to and upon the terms and
conditions set forth herein, each Lender having a Tranche A Term Commitment
severally agrees to make one term loan (each, a "Tranche A Term Loan" and
collectively, the "Tranche A Term Loans") to Comercial on the Effective Date
in an aggregate amount equal to such Lender's Tranche A Term Commitment.
Tranche A Term Loans are available only on the terms and conditions specified
hereunder, and once repaid, in full or in part, at maturity or by prepayment,
may not be reborrowed in full or in part. For the purpose of clarification,
the Tranche A Term Loan Commitments are for principal only and are exclusive
of any amount of interest, fees or other amounts due hereunder. The Borrowing
of Tranche A Term Loans shall be incurred from the Lenders pro rata on the
basis of their Tranche A Term Commitments.
2.1.2 Tranche A Revolving Loans. Subject to and upon the terms and
conditions set forth herein, each Lender having a Tranche A Revolving
Commitment severally agrees to make revolving loans (each, a "Tranche A
Revolving Loan" and collectively, the "Tranche A Revolving Loans") to
Comercial from time to time on any Business Day occurring on or after the
Effective Date and prior to the Tranche A Revolving Commitment Termination
Date in a minimum aggregate amount for each Borrowing of U.S.$1,000,000 and
integral multiples of U.S.$500,000 in excess thereof; provided, that such
U.S.$1,000,000 minimum borrowing amount shall not apply to any Borrowing of
the entire remaining available amount of the Tranche A Revolving Commitment;
further provided, that after giving effect to any Borrowing the aggregate
principal amount of Tranche A Revolving Loans outstanding of any Lender shall
not exceed the Tranche A Revolving Commitment of such Lender and the aggregate
principal amount of Tranche A Revolving Loans outstanding of all Lenders shall
not exceed the sum of the Tranche A Revolving Commitments of all the Lenders.
Tranche A Revolving Loans are available only on the terms and conditions
specified hereunder. For the purpose of clarification, the Tranche A Revolving
Commitments are for principal only and are exclusive of any amount of
interest, fees or other amounts due hereunder. On the terms and subject to the
conditions hereof, Comercial may from time to time borrow, prepay and reborrow
Tranche A Revolving Loans. The Borrowing of Tranche A Revolving Loans shall be
incurred from the Lenders pro rata on the basis of their Tranche A Revolving
Commitments.
2.1.3 Tranche B Loans. Subject to and upon the terms and conditions
set forth herein, each Lender severally agrees to make one term loan (each, a
"Tranche B Loan" and collectively, the "Tranche B Loans") to Comercial on the
Effective Date in an aggregate amount
18
equal to such Lender's Tranche B Commitment. Tranche B Loans are available
only on the terms and conditions specified hereunder, and once repaid, in full
or in part, at maturity or by prepayment, may not be reborrowed in full or in
part. For the purpose of clarification, the Tranche B Commitments are for
principal only and are exclusive of any amount of interest, fees or other
amounts due hereunder. The Borrowing of Tranche B Loans shall be incurred from
the Lenders pro rata on the basis of their Tranche B Commitments.
2.2 Notice of Borrowing. Whenever Comercial desires to make a
Borrowing, it shall give the Administrative Agent at its Notice Office at
least three Business Days' prior notice thereof; provided, that such notice
shall be deemed to have been given on a certain day only if given before 11:00
a.m. (U.S. Central Standard time) on such day; and if given at 11:00 a.m.
(U.S. Central Standard time) or later on any day, such notice shall be deemed
to have been given on the following Business Day. Such notice (the "Notice of
Borrowing") shall be irrevocable and shall be given by Comercial in
substantially the form of Exhibit A, appropriately completed to specify (i)
the aggregate principal amount of the Loans to be made pursuant to such
Borrowing, (ii) whether such Borrowing will consist of Base Rate Loans or
LIBOR Loans, (iii) the Borrowing Date (which shall be a Business Day), (iv)
the duration of the initial Interest Period applicable thereto (which shall be
one, two, three or, if available and in the discretion of the Administrative
Agent, six months), and (v) the maturity date of any Tranche A Revolving Note
to be issued to evidence any proposed Tranche A Revolving Note and noting
either that there are no Tranche A Revolving Notes then outstanding or that
all other Tranche A Revolving Notes have the same maturity date. The
Administrative Agent shall promptly (but in any event, not later than two
Business Days prior to the applicable Borrowing Date) give each relevant
Lender notice of such proposed Borrowing, of such Lender's proportionate share
thereof, if any, and of the other matters required by the immediately
preceding sentence to be specified in the Notice of Borrowing.
2.3 Disbursement of Funds.
(a) Subject to the terms and conditions hereof, no later than 11:00
a.m. (U.S. Central Standard time) on the applicable Borrowing Date, each
Lender will make available, through such Lender's Lending Office, its pro rata
portion, if any, of the aggregate amount of the Loans requested to be made on
such date, in Dollars and in immediately available funds at the Payment Office
of the Administrative Agent, and the Administrative Agent will transfer the
aggregate of the amounts so made available by the Lenders to, or to the order
of, Comercial pursuant to wire instructions provided to the Administrative
Agent not later than two Business Days prior to such Borrowing Date.
(b) Unless the Administrative Agent shall have been notified by any
Lender prior to the date of the applicable Borrowing that such Lender does not
intend to make available to the Administrative Agent such Lender's portion of
such Borrowing to be made on such date, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent on
such date and the Administrative Agent may (but shall have no obligation to),
in reliance upon such assumption, make available to Comercial a corresponding
amount. If such corresponding amount is not in fact made available to the
Administrative Agent by such Lender, the Administrative Agent shall be
entitled to recover such corresponding amount from such Lender on demand. If
such Lender does not pay such corresponding amount forthwith
19
upon the Administrative Agent's demand therefor, the Administrative Agent shall
promptly notify Comercial and Comercial shall promptly pay such corresponding
amount to the Administrative Agent; provided, that any such repayment by
Comercial under this Section 2.3(b) shall not constitute a repayment of the
Loans for purposes of the second sentence of Section 2.1.1 or the second
sentence of Section 2.1.3. The Administrative Agent shall also be entitled to
recover on demand from such Lender or Comercial, as the case may be, interest
on such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to
Comercial until the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (i) if such amount is
recovered from such Lender, the cost to the Administrative Agent of acquiring
overnight federal funds at the then applicable rate for the Loans, and (ii) if
such amount is recovered from Comercial, the then applicable rate of interest
as provided herein. Nothing in this Section 2.3 shall be deemed to relieve any
Lender from its obligation to make a Loan hereunder or to prejudice any rights
which Comercial may have against any Lender as a result of any failure by such
Lender to make a Loan thereunder.
2.4 Notes.
(a) Comercial's obligation to pay the principal of, and interest on,
each Tranche A Term Loan made by a Lender shall be evidenced by a promissory
note (each, a "Tranche A Term Note") which shall be a Base Rate Note to
evidence Borrowings accruing interest at the Base Rate and/or a LIBOR Note to
evidence Borrowings accruing interest at LIBOR, as the case may be) in
substantially the form of Exhibit B-1 or Exhibit B-2, respectively, duly
executed and delivered by Comercial (and signed por aval by Vitrocrisa and
Vitro) with blanks appropriately completed in conformity herewith. Comercial's
obligation to pay the principal of, and interest on, each Tranche A Revolving
Loans made by a Lender shall be evidenced by a promissory note (each, a
"Tranche A Revolving Note") which shall be a Base Rate Note to evidence
Borrowings accruing interest at the Base Rate and/or a LIBOR Note to evidence
Borrowings accruing interest at LIBOR, as the case may be) in substantially
the form of Exhibit B-3 or Exhibit B-4, respectively, duly executed and
delivered by Comercial (and signed por aval by Vitrocrisa and Vitro) with
blanks appropriately completed in conformity herewith. Comercial's obligation
to pay the principal of, and interest on, each Tranche B Loan made by a Lender
shall be evidenced by a promissory note (each, a "Tranche B Note") which shall
be a Base Rate Note to evidence Borrowings accruing interest at the Base Rate
and/or a LIBOR Note to evidence Borrowings accruing interest at LIBOR, as the
case may be) in substantially the form of Exhibit B-5 or Exhibit B-6,
respectively, duly executed and delivered by Comercial (and signed por aval by
Vitrocrisa) with blanks appropriately completed in conformity herewith. The
Notes issued to each Lender on or before each Borrowing Date in accordance
with Section 5.2.6 shall (i) be executed by Comercial (and signed por aval by
Vitrocrisa and in the case of the Tranche A Notes also signed por aval by
Vitro), (ii) be payable to such Lender and be dated such Borrowing Date, (iii)
be in a stated principal amount equal to the relevant Loan of such Lender made
on such Borrowing Date, (iv) provide for repayment of principal as provided in
Section 4.2, (v) bear interest as provided in Section 2.6, and (vi) in the
case of the Revolving Tranche A Notes, all notes outstanding at any time shall
have the same maturity date, and such maturity date shall not occur more than
6 months after the funding date of the Tranche A Revolving Loan that has been
outstanding for the longest time. Upon changes to the Tranche A Applicable
Margin or Tranche B Applicable Margin pursuant to the provisos to the
definitions
20
thereof or in the case of a change from LIBOR to the Base Rate
pursuant to Section 2.8(a), Comercial and Vitrocrisa (and in the case of
changes to the Tranche A Applicable Margin, Vitro) shall execute or sign por
aval, as applicable, and deliver new Notes to the Lenders reflecting the new
Applicable Margin; and the Lenders shall deliver to the Administrative Agent
for cancellation the Notes to be replaced and the Administrative Agent shall
promptly deliver the canceled Notes to Comercial.
(b) Each Lender will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will, prior to any
transfer of its Note, endorse such Note "en propriedad" and record on such
Note any amounts received thereunder as of the date of transfer. Failure to
make any such notation shall not affect Comercial's obligations (or
Vitrocrisa's or Vitro's obligations as guarantors) in respect of such Loans.
2.5 Several Commitments. No Lender shall be responsible for any
default by any other Lender of its obligation to make a Loan, and each Lender
shall be obligated to make the Loans provided to be made by it hereunder
regardless of the failure of any other Lender to make its Loan hereunder.
2.6 Interest.
(a) Comercial agrees to pay interest in respect of the unpaid
principal amount of each Loan from the date the proceeds thereof are made
available to Comercial as provided herein until the maturity thereof (whether
by acceleration or otherwise) at a rate per annum which shall, during each
period applicable thereto, be (i) in respect of LIBOR Loans, equal to the sum
of LIBOR for such Interest Period plus the Applicable Margin in effect during
such period, (ii) in respect of Base Rate Loans, equal to the sum of the Base
Rate for such period plus the Applicable Margin in effect during such period
and (iii) upon the occurrence of the events described in Section 2.8(a), the
rate of interest shall be as provided therein.
(b) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable by
Comercial hereunder or under any other Transaction Document shall bear
interest payable on demand at a rate per annum equal to (i) in respect of
LIBOR Loans, the sum of LIBOR in effect from time to time plus the relevant
Applicable Margin applicable to such Loan in effect during such period plus
2.00%, or (ii) in respect of Base Rate Loans, the sum of the Base Rate plus
the relevant Applicable Margin applicable to such Loan in effect during such
period plus 2.00%.
(c) Accrued (and theretofore unpaid) interest shall be payable in
respect of (i) each LIBOR Loan on the last day of the Interest Period
applicable thereto in the case of interest accruing during a one-, two- or
three-month Interest Period, and, on the day which is three months after the
first day, and on the last day, of the Interest Period applicable thereto in
the case of interest accruing during a six-month Interest Period, and (ii)
each Base Rate Loan on the last Business Day of each calendar quarter, for the
quarter then ending. Interest on all Loans shall also be payable, on any
repayment or prepayment (on the amount repaid or prepaid), at maturity
(whether by acceleration or otherwise) and, after such maturity, on demand.
21
(d) In the case of LIBOR Loans, on each Interest Determination Date
the Administrative Agent shall determine LIBOR for the Interest Period
applicable to such Loans and shall promptly notify in writing Comercial and
the Lenders thereof. Each determination by the Administrative Agent of LIBOR
and the Base Rate shall, absent manifest error, be final and conclusive and
binding on all parties hereto.
(e) In accordance with Section 4.3 hereof, all payments under this
Section 2.6 from, or on behalf of, Comercial shall be made to the
Administrative Agent for distribution by the Administrative Agent to the
Lenders in like funds as received and to the extent received by the
Administrative Agent.
2.7 Interest Periods. (a) As to the making of any LIBOR Loan, at the
time Comercial gives the Notice of Borrowing in respect of the making of such
LIBOR Loan (in the case of the initial Interest Period applicable thereto) or
on the third Business Day prior to the expiration of an Interest Period
applicable to such LIBOR Loan (in the case of any subsequent Interest Period),
Comercial shall have the right to elect, by giving the Administrative Agent
notice thereof, the interest period (the "Interest Period") applicable to such
LIBOR Loan, which Interest Period shall, at the option of Comercial, be a
one-, two-, three- or, if available and in the discretion of the
Administrative Agent, six-month period; provided, that (i) all LIBOR Loans
comprising a Borrowing shall at all times have the same Interest Period, (ii)
the initial Interest Period for the LIBOR Loans shall commence on the
Borrowing Date of such LIBOR Loans and each Interest Period occurring
immediately thereafter in respect of such LIBOR Loans (A) shall commence on
(and include) the day on which the next preceding Interest Period applicable
thereto expires, and (B) shall not include the day on which the Interest
Period for such LIBOR Loans expires, (iii) no Interest Period may be selected
at any time when a Default or Event of Default is then in existence or when
such Interest Period extends beyond the relevant Final Maturity Date, (iv) no
Interest Period with respect to the Tranche A Term Loans or the Tranche B
Loans shall extend beyond any date upon which a repayment of the Tranche A
Term Loans or the Tranche B Loans, respectively, is required to be made
pursuant to Section 4.2 unless the aggregate principal amount of the Tranche A
Term Loans which are Base Rate Loans or which have Interest Periods which will
expire before such date is equal to or in excess of the amount of the
repayment of the Tranche A Term Loans or the Tranche B Loans, as the case may
be, required to be made on such date, and (v) there shall be no more than two
Interest Periods in effect at any time for Tranche A Revolving Loans
consisting of LIBOR Loans and (vi) there shall be no more than one Interest
Period at any time for all Tranche A Term Loans and Tranche B Loans consisting
of LIBOR Loans. If on the third Business Day prior to the expiration of any
Interest Period, Comercial has failed to make an election of a new Interest
Period to be applicable thereto, Comercial shall be deemed to have elected a
one-month Interest Period.
(b) If any Interest Period relating to any Loan begins on a day for
which there is no numerically corresponding day in the calendar month at the
end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month.
(c) If any Interest Period would otherwise expire on a day which is
not a Business Day, such Interest Period shall expire on the next succeeding
Business Day (provided, however, that if any Interest Period would otherwise
expire on a day which is not a Business Day
22
but is a day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business Day).
2.8 Increased Costs, Illegality, etc.
(a) In the event that any Lender (or, the Administrative Agent, in
the case of Section 2.8(a)(i) as to which only the Administrative Agent is
permitted to make a determination) shall have determined (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto):
(i) on any Interest Determination Date that, by reason of any
changes arising after the Closing Date affecting the London interbank
Eurodollar market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition
of LIBOR; or
(ii) at any time, that such Lender shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Loan because of (x) any change since the Closing Date in
any applicable Law or governmental rule, regulation, order, guideline or
request (whether or not having the force of Law) or in the interpretation
or administration thereof and including the introduction of any new Law
or governmental rule, regulation, order, guideline or request, such as,
for example, but not limited to: (A) a change in the basis of taxation of
payments to any Lender of the principal of or interest on the Notes or
any other amounts payable hereunder (except for changes in the rate of
tax on, or determined by reference to, the net income or profits of such
Lender pursuant to the laws of the jurisdiction in which it is organized
or in which its principal office or applicable lending office is located
or any subdivision thereof or therein) or (B) a change in official
reserve requirements and/or (y) other circumstances external to such
Lender since the Closing Date affecting such Lender or the London
interbank Eurodollar market or the position of such Lender in such
market; or
(iii) at any time, that the making, conversion or continuance
of any Loan has been made (x) unlawful by any Law or governmental rule,
regulation or order, (y) impossible by compliance by any Lender in good
faith with any governmental request (whether or not having force of Law)
or (z) impracticable as a result of a contingency occurring after the
Closing Date which materially and adversely affects the London interbank
Eurodollar market;
then, and in any such event, such Lender (or the Administrative Agent, in the
case of clause (i) above) shall promptly give telephonic notice (confirmed in
writing) to Comercial and, except in the case of clause (i) above, to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x) in
the case of clause (i) above, the interest rate during the applicable Interest
Period shall be the Base Rate in effect from time to time during such Interest
Period plus the Applicable Margin, (y) in the case of clause (ii) above,
Comercial shall pay to such Lender, upon written demand therefor, such
additional amounts as shall be required to compensate such Lender for such
increased costs or reductions in amounts received or receivable hereunder (a
written notice as to the additional amounts owed to such Lender, showing the
basis for the calculation thereof, submitted to
23
Comercial by such Lender shall, absent manifest error, be final and conclusive
and binding on all the parties hereto) and (z) in the case of clause (iii)
above, Comercial shall take one of the actions specified in Section 2.8(b) as
promptly as possible and, in any event, within the time period required by
law.
(b) At any time that any Loan is affected by the circumstances
described in Section 2.8(a)(i) or (ii), Comercial may (and in the case of a
Loan affected by the circumstances described in Section 2.8(a)(iii) shall) if
the affected Loan is then outstanding, upon at least five Business Days'
written notice to the Administrative Agent, repay the Loan of the affected
Lender (including all accrued interest and fees); provided, that if more than
one Lender is affected at any time, then all affected Lenders must be treated
the same pursuant to this Section 2.8(b).
(c) If any Lender determines at any time that the introduction or
implementation of, or any change in, any applicable Law or governmental rule,
regulation, order, guideline, direction or request (whether or not having the
force of Law), concerning capital adequacy, or any change in interpretation or
administration thereof by any governmental authority, central bank or
comparable agency, will have the effect of increasing the amount of capital
required or expected to be maintained by such Lender or any Person controlling
such Lender based on the existence of such Lender's Tranche A Revolving
Commitment, Tranche A Term Commitment and/or Tranche B Commitment hereunder or
its obligations or Loans hereunder, then Comercial shall pay to such Lender,
within 15 Business Days of its written demand therefor, such additional
amounts as shall be required to compensate such Lender for the increased cost
to such Lender as a result of such increase of capital. In determining such
additional amounts, each Lender will act reasonably and in good faith and will
use averaging and attribution methods which are reasonable; provided, that
such Lender's determination of compensation owing under this Section 2.8
shall, absent manifest error, be final and conclusive and binding on all the
parties hereto. Each Lender, upon determining that any additional amounts will
be payable pursuant to this Section 2.8(c), will give prompt written notice
thereof to Comercial and the Administrative Agent, which notice shall show the
basis for calculation of such additional amounts; provided, that no such
additional amounts shall be payable hereunder for any period from 45 days
after the date on which the affected Lender becomes actually aware of such
increased capital requirements to the date on which such Lender delivers
notice of such increased capital requirements.
2.9 Compensation. Comercial shall compensate each Lender, upon its
written request (which request shall set forth the basis for requesting such
compensation and shall, absent manifest error, be final and conclusive and
binding on all the parties hereto), for all reasonable losses, expenses and
liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other
funds required by such Lender to fund its Loans) which such Lender may
sustain: (i) if for any reason (other than a default by such Lender or the
Administrative Agent) the Borrowing of Loans does not occur on the date
specified therefor in the Notice of Borrowing (whether or not withdrawn by
Comercial); (ii) if any repayment (including any prepayment made pursuant to
Section 4, but excluding any prepayment pursuant to Section 2.3(b)) of its
LIBOR Loans occurs on a date which is not the last day of an Interest Period
with respect thereto; (iii) as a consequence of (x) any other default by
Comercial to repay the Loans when required by the terms of this
24
Agreement or the Notes or (y) any actions taken pursuant to Section 2.8(b); or
(iv) as a consequence of the assignment or participation by any Lender of all
or any portion of the Loans.
2.10 Change of Lending Office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.8 or 4.4
with respect to such Lender, it shall, if reasonably requested by Comercial,
designate another Lending Office for any Loans affected by such event;
provided, that such designation is made on such terms that such Lender and its
Lending Office suffer no economic, legal or regulatory disadvantage or loss,
with the object of avoiding or reducing the consequence of the event giving
rise to the operation of such Section. Nothing in this Section 2.10 shall
affect or postpone any of the obligations of Comercial or the right of any
Lender provided in Section 2.8 or 4.4.
Section 3. Fees.
3.1 Commitment Fee. Comercial agrees to pay to the Administrative
Agent for the account of each Lender having a Tranche A Revolving Commitment a
commitment fee (the "Commitment Fee") for the period from the Closing Date to
the Tranche A Revolving Commitment Termination Date on the average daily
unused portion of such Lender's Tranche A Revolving Commitment, as from time
to time in effect, at the rate of .75% per annum. The Commitment Fee shall be
payable in arrears on the last day of each calendar quarter. Any amount of
accrued Commitment Fees which is not paid when due shall bear interest payable
on demand, from the date on which such amount is due until such amount is paid
in full, at the rate per annum equal at all times to the lesser of (i) the
highest lawful rate under applicable law, and (ii) 2% per annum above the sum
of the Tranche A Applicable Margin plus the Base Rate.
3.2 Upfront and Structuring Fees. Comercial agrees to pay to the
Administrative Agent for the account of the Arranger, on the Closing Date, all
upfront fees and structuring fees in the amount specified in, and otherwise in
accordance with, the terms of and for the account of the Persons specified, in
the Administrative Agent Fee Letter. For the avoidance of doubt, such fees may
be paid from the proceeds of the Loans made on the initial Borrowing Date.
3.3 Administrative Agency Fee. Comercial agrees to pay to the
Administrative Agent for its sole account, on the Closing Date and on each
anniversary date thereafter, an administrative agency fee in the amount
specified in, and otherwise in accordance with, the terms of the
Administrative Agent Fee Letter. For the avoidance of doubt, the initial fee
due pursuant to this Section 3.3 may be paid from the proceeds of the Loans
made on the initial Borrowing Date.
3.4 Collateral Agency Fee. Comercial agrees to pay to the Collateral
Agents for their sole account, on the Closing Date and on such dates specified
in the Collateral Agent Fee Letter, a collateral agency fee in the amount
specified in, and otherwise in accordance with, the terms of the Collateral
Agent Fee Letter. In addition, Comercial agrees to reimburse the Collateral
Agents for their sole account, on the Closing Date and at such other times as
specified in the Collateral Agent Fee Letter, all out-of-pocket expenses
reasonably incurred by the Collateral Agents, in accordance with the terms of
the Collateral Agent Fee Letter. For the
25
avoidance of doubt, the initial fee due pursuant to this Section 3.4 may be
paid from the proceeds of the Loans made on the initial Borrowing Date.
Section 4. Prepayments; Payments.
4.1 Voluntary Prepayments. Comercial shall have the right to prepay
the Loans, without premium or penalty, in whole or in part, on the following
terms and conditions: (a) Comercial shall give the Administrative Agent at the
Notice Office at least five Business Days' prior written notice of its intent
to prepay the Loans and the amount of such prepayment; (b) each prepayment in
respect of any Loans shall be in an aggregate principal amount of at least
U.S.$2,500,000; (c) prepayments of a LIBOR Loan may only be made pursuant to
this Section 4.1 on the last day of an Interest Period applicable thereto,
unless Comercial pays all amounts owing under Section 2.9 as a result of
repaying such Loan on a day other than the last day of the Interest Period
applicable thereto; (d) all voluntary prepayments (other than voluntary
prepayments designated by the Borrower as prepayments of Tranche A Revolving
Loans) and Excess Cash Flow Prepayments on the Loans shall be applied as
follows: (i) the initial U.S.$6,000,000 of such voluntary prepayments and
Excess Cash Flow Prepayments shall be applied pro rata based on the ratio of
the outstanding Tranche A Loans plus unused Tranche A Revolving Commitments to
the outstanding Tranche B Loans on the date the prepayment is made as follows:
(A) first to all Tranche A Term Loans and Tranche B Loans then outstanding in
inverse order of maturity; and (B) after all Tranche A Term Loans and Tranche
B Loans have been repaid in full, to the Tranche A Revolving Loans then
outstanding; and (ii) all other voluntary prepayments and Excess Cash Flow
Prepayments shall be applied as follows: (A) first, to all Tranche A Term
Loans then outstanding in inverse order of maturity, until the outstanding
amount of Tranche B Loans reaches 49% of the sum of the aggregate principal
amount of the Loans then outstanding plus the unused Tranche A Revolving
Commitments; (B) thereafter until all Tranche B Loans are paid in full,
further voluntary prepayments and Excess Cash Flow Prepayments will be applied
to Tranche A Term Loans and Tranche B Loans in inverse order of maturity, in a
proportion that assures that following the application of such repayment the
Tranche A Loans plus the unused Tranche A Revolving Commitments represent 51%
and the Tranche B Term Loans represent 49%, in each case, of the sum of the
aggregate principal amount of the Loans then outstanding plus the unused
Tranche A Revolving Commitments; and (C) thereafter, further voluntary
prepayments and Excess Cash Flow Prepayments will be applied to repay Tranche
A Term Loans in inverse order of maturity and after all Tranche A Term Loans
are paid, to repay Tranche A Revolving Loans; and (e) any voluntary
prepayments applied to the Tranche A Term Loans and any Excess Cash Flow
Prepayments applied to repay Tranche A Loans shall permanently reduce, on a
pro rata basis, the Tranche A Revolving Commitments in an amount equal to such
voluntary prepayments or Excess Cash Flow Prepayments. All prepayments
pursuant to this Section shall be made together with accrued interest to the
date of such prepayment on the principal amount prepaid. The foregoing
notwithstanding, amounts paid by a Guarantor to pay in full the Loans
guaranteed by a Defaulting Guarantor shall be applied to the Loans guaranteed
by the Defaulting Guarantor, it being further understood that in such
instance, the Guarantor making such payment shall not have greater subrogation
rights than the Defaulting Guarantor would have had under the terms of its
Guaranty.
26
4.2 Repayments; Mandatory Repayments.
4.2.1 Mandatory Repayment of Tranche A Term Loans. Comercial shall
repay the Tranche A Term Loans in nineteen (19) consecutive quarterly
installments and on the Final Maturity Date for Tranche A Term Loans, on the
dates set forth below and in an amount, on each such date, equal to the
product of (x) the applicable percentage set forth opposite such date and (y)
the aggregate principal amount of the Tranche A Term Loans made (each such
repayment, a "Tranche A Term Scheduled Repayment" and each such date, a
"Tranche A Term Scheduled Repayment Date"):
Tranche A Term
Scheduled Repayment Date Amortization Percentage
July 6, 2004 4.0%
October 2, 2004 4.0%
January 2, 2005 4.0%
April 2, 2005 4.0%
July 2, 2005 4.0%
October 2, 2005 4.0%
January 2, 2006 4.0%
April 2, 2006 4.0%
July 2, 2006 5.50%
October 2, 2006 5.50%
January 2, 2007 5.50%
April 2, 2007 5.50%
July 2, 2007 5.50%
October 2, 2007 5.50%
January 2, 2008 5.50%
April 2, 2008 5.50%
July 2, 2008 6.00%
October 2, 2008 6.00%
January 2, 2009 6.00%
April 2, 2009 6.00%
4.2.2 Mandatory Repayments of Tranche B Loans. (a) Comercial shall
repay the Tranche B Loans in two (2) consecutive quarterly installments and on
the Final Maturity Date for Tranche B Loans, on the dates set forth below and
in an amount, on each such date, equal to the product of (x) the applicable
percentage set forth opposite such date and (y) the aggregate principal amount
of the Tranche B Loans made (each such repayment, a "Tranche B Scheduled
Repayment" and each such date, a "Tranche B Scheduled Repayment Date"):
00
Xxxxxxx X
Scheduled Repayment Date Amortization Percentage
October 2, 2006 10%
January 2, 2007 30%
April 2, 2007 60%
4.2.3 Mandatory Repayments of Tranche A Revolving Loans. (a)
Comercial shall repay the Tranche A Revolving Loans outstanding as of the
Tranche A Revolving Loans Commitment Termination Date in full on such date.
(b) In addition to any repayments pursuant to Section 4.2.3 (a), if
at any time after any Borrowing Date the aggregate outstanding principal
amount of the Tranche A Revolving Loans exceeds the Tranche A Revolving
Commitment, Comercial shall promptly prepay principal of the Tranche A
Revolving Loans in an amount equal to such excess. Each prepayment in respect
of any Tranche A Revolving Loans shall be applied pro rata first, to all Base
Rate Loans then outstanding, and second, to all LIBOR Loans then outstanding.
Any such prepayment shall be applied to scheduled maturities in inverse order
of maturity.
(c) In addition to any repayments of principal of Tranche A
Revolving Loans required to be made pursuant to Section 4.2.3(a) or Section
4.2.3(b), Comercial shall cause the aggregate outstanding principal amount of
the Tranche A Revolving Loans to be prepaid in full and reduced to zero for at
least one period of five (5) consecutive calendar days (each a "Clean Down
Period") during each six (6) month period following the Closing Date,
commencing with the six-month period that begins on the Closing Date and that
ends on the numerically corresponding day in the calendar month that is six
months after the Closing Date (or if there is no numerically corresponding
date, the last day of the month that is six months after the Closing Date),
and thereafter during each sixth-month period commencing when the immediately
preceding six-month period ends. Comercial shall designate each Clean Down
Period by giving three (3) Business Days prior notice to the Administrative
Agent; provided, that if Comercial shall fail to provide such notice with
respect to any six-month period then the Clean Down Period for such six-month
period shall be the last five (5) calendar days of such period.
4.2.4 Excess Cash Flow Prepayments. Within five (5) Business Days
after each delivery of a certificate from Comercial pursuant to Section
7.1(f), Comercial shall make an Excess Cash Flow Prepayment of the outstanding
Loans in an amount required by Section 7.20. Each Excess Cash Flow Prepayment
shall be applied to the repayment of Loans pursuant to Sections 4.1(d) and
(e). Each Excess Cash Flow Prepayment shall be paid in Dollars.
4.3 Method and Place of Payment.
(a) Except as otherwise specifically provided herein, all payments
under this Agreement or any Note shall be made by Comercial to the
Administrative Agent for the account of the Lender or Lenders entitled thereto
not later than 11:00 a.m. (U.S. Central Standard time) on the date when due
and shall be made in Dollars in immediately available funds at the Payment
Office pursuant to the following wire instructions:
28
Xxxxxx Trust and Savings Bank
Chicago Branch
ABA# 000000000
for the account of
Bank of Montreal, Chicago Branch
A/C# 0000000
Re: Comercial
The foregoing wire instructions may be changed at any time by the
Administrative Agent by providing ten (10) days advance notice to Comercial in
the manner provided herein.
(b) Whenever any payment to be made hereunder or under any Note
shall be stated to be due on a day which is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day unless such next
Business Day falls in the following calendar month, in which case the due date
shall be the next preceding Business Day, and, with respect to payments of
principal, such extension or reduction of time shall be included in the
computation of interest.
4.4 Net Payments. All payments made by Comercial and Vitrocrisa
hereunder or under any Note will be made without setoff, counterclaim or other
defense. All such payments will be made free and clear of, and without
deduction or withholding for, any present or future taxes, value-added taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed (in all cases excluding income taxes) and all
interest, penalties or similar liabilities with respect thereto (collectively,
"Additional Costs"); provided, however, that anything herein contained to the
contrary notwithstanding, Comercial and Vitrocrisa shall not be required to
pay withholding taxes in excess of the amount of withholding taxes that would
be payable by a financial institution that is both (i) a resident of a country
with which Mexico has entered into a treaty for the avoidance of double
taxation which is in effect in such country and (ii) registered with the SHCP
for purposes of Article 195(I) of the Mexican Income Tax Law (or any successor
provision). Such withholding tax rate is currently 4.9%. If any Additional
Costs are required by Law to be deducted or withheld from, or in respect of,
any sum payable hereunder, each of Comercial and Vitrocrisa, as the case may
be, agrees to pay, subject to the proviso in the immediately foregoing
sentence, the full amount of such Additional Costs and such other additional
amounts as may be necessary so that every payment of all amounts due hereunder
or under any Note, after withholding or deduction for or on account of any
Additional Costs, will not be less than the amount provided for herein or in
such Note. Subject to the proviso in the first sentence of this Section 4.4,
Comercial or Vitrocrisa, as the case may be, will furnish to the
Administrative Agent within sixty (60) days after the date the payment of any
Additional Costs is due pursuant to applicable law copies of tax forms
evidencing such payment by Comercial or Vitrocrisa, duly stamped by or on
behalf of the Ministry of Finance and Public Credit of Mexico (the "SHCP") or
any other applicable Government Agency. Subject to the proviso in the first
sentence of this Section 4.4, each of Comercial and Vitrocrisa, as the case
may be, will indemnify and hold harmless each Lender, and reimburse such
Lender promptly upon its written request, for the amount of any Additional
Costs or other taxes described above which are levied or imposed on and paid
by such Lender.
29
Section 5. Conditions Precedent.
5.1 Conditions Precedent to the Initial Borrowing Date. The
obligation of each Lender to make Loans on the initial Borrowing Date is
subject, at the time of such Borrowing, to the satisfaction of the following
conditions precedent set forth in this Section 5.1:
5.1.1 Execution of Agreement and other Transaction Documents. The
Administrative Agent shall have received executed counterparts of each of the
following documents duly executed by each of the parties thereto:
(i) This Agreement executed by each of Comercial, Vitrocrisa,
each Lender, the Collateral Agent and the Administrative Agent;
(ii) The Libbey Guaranty executed by Libbey and Libbey Glass;
(iii) The US Affiliate Guaranties executed by the US
Affiliates;
(iv) The Security Agreement executed by Comercial and the
Collateral Agent;
(v) The US Affiliate Security Agreements executed by the US
Affiliates and the Collateral Agent;
(vi) The Non-Possessory Pledge Agreement which (A) has been
duly executed by Comercial and the Collateral Agent before a notary
public (or public attestor) and (B) has been filed for recordation with
the Public Registry of Property and Commerce of Monterrey, Nuevo Xxxx,
Mexico, together with evidence thereof as shall be acceptable to the
Administrative Agent;
(vii) The Consent executed by Libbey Glass;
(viii) The Vitro Guaranty executed by Vitro; and
(ix) The Account Control Agreements executed by the Account
Banks, the Collateral Agent and the US Affiliates,
together with acknowledgement copies of properly filed Uniform Commercial Code
financing statements (Form UCC-1), or such other evidence of filing as may be
acceptable to the Administrative Agent, naming Comercial and the US Affiliates
as debtor and the Collateral Agent as secured party and other instruments or
documents, filed under the relevant laws of all jurisdictions as may be
necessary or, in the opinion of the Administrative Agent, desirable to perfect
the security interest of the Collateral Agent pursuant to the Transaction
Documents.
5.1.2 Officer's Certificate; Proceedings.
(i) The Administrative Agent shall have received a certificate
from each of Comercial, Vitrocrisa, Vitro, Libbey and Libbey Glass dated
the initial Borrowing Date, signed by the President, any Vice President
or other duly authorized
30
senior officer or attorney-in-fact of Comercial, Vitrocrisa, Vitro,
Libbey and Libbey Glass, respectively, substantially in the form of
Exhibit C-1, and a certificate of the Secretary or Assistant Secretary of
Comercial, Vitrocrisa, Vitro, Libbey and Libbey Glass, respectively,
substantially in the form of Exhibit C-2, certifying as to, among other
things, the names and true signatures of the officers authorized to sign
the Transaction Documents, with appropriate insertions, together with
copies of the incorporation deed (acta constitutiva) or articles of
incorporation, as applicable, the current bylaws (estatutos sociales) and
resolutions then in full force and effect authorizing the execution,
delivery and performance of the Transaction Documents to which such
Person is a party and the incumbency and signatures of those of its
officers authorized to act with respect to the Transaction Documents
executed by it.
(ii) All corporate and legal proceedings and all Transaction
Documents shall be satisfactory in form and substance to the Lenders, and
the Administrative Agent shall have received all information and copies
of all documents and papers, including records of corporate proceedings,
Governmental Approvals and contractual approvals, if any, which any
Lender reasonably may have requested in connection therewith, such
documents and papers where appropriate to be certified by proper
corporate authorities or Government Agencies.
5.1.3 Opinions of Counsel. The Administrative Agent shall have
received an opinion addressed to the Administrative Agent and each of the
Lenders and dated the Closing Date from each of (i) Cravath, Swaine & Xxxxx
LLP, special New York counsel to Comercial, Vitrocrisa, Vitro and the US
Affiliates, in substantially the form of Exhibit D-1, (ii) in-house counsel to
Comercial, Vitrocrisa and Vitro in substantially the form of Exhibit D-2,
(iii) Jauregui, Navarrete, Xxxxx x Xxxxx, S.C., special Mexican counsel to
Comercial, Vitrocrisa and Vitro, in substantially the form of Exhibit D-3,
(iv) Xxxxxx & Xxxxxxx LLP, counsel to Libbey and Libbey Glass, in
substantially the form of Exhibit D-4, (v) Xxxxxxxx & Xxxxxx, special Texas
counsel to Crisa Ltd., in substantially the form of Exhibit D-5, and (vi)
Xxxxxxxx, Xxxxxx & Finger, P.A., special Delaware counsel to Crisa Industrial,
in substantially the form of Exhibit D-6, and (vii) Lasa Xxxxxxx & Veve,
special District of Columbia counsel to Comercial, in substantially the form
of Exhibit D-7.
5.1.4 Process Agent Letter. The Administrative Agent shall have
received a letter from each of Comercial, Vitrocrisa and Vitro, in each case
substantially in the form of Exhibit E, confirming its appointment of the
Process Agent as agent for each such Person to accept service of process in
connection with the transactions contemplated by the Transaction Documents,
together with the countersignature of the Process Agent indicating its consent
to serve in such capacity.
5.1.5 Financial Statements. Each of Comercial, Vitrocrisa, Vitro and
Libbey shall have delivered to the Administrative Agent the financial
statements described in Section 6.7(a).
5.1.6 Due Diligence. The Arranger and the Administrative Agent shall
have completed due diligence, in scope and with results satisfactory to them,
of Comercial, Vitrocrisa, Vitro, Libbey and Libbey Glass and their respective
Subsidiaries, plants, business,
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management, corporate governance, tax, accounting, legal, regulatory,
environmental, structural, and ownership matters.
5.1.7 Subsidiaries. Each of Comercial and Vitrocrisa shall have
delivered a certificate to the Administrative Agent for the benefit of the
Lenders certifying that such Person has no existing Subsidiaries.
5.1.8 Market Conditions, etc. There shall not have occurred any
material adverse change or any development involving a material prospective
adverse change, in the United States, Mexican or international capital markets
or other financial, political or economic conditions, or currency exchange
rates or exchange controls applicable to the Dollar or the Peso, including
without limitation any disruption or material adverse change in the market for
borrowers domiciled in Mexico, as would, in the sole judgment of the
Administrative Agent, make it impracticable for the Administrative Agent to
successfully syndicate any Loan.
5.1.9 Payment of Outstanding Indebtedness, etc. Simultaneous with,
and from the net proceeds of, the initial Borrowing, all Indebtedness
identified in Schedule III ("Indebtedness to be Paid"), together with all
interest, all prepayment premiums and other amounts due and payable with
respect thereto, shall be paid in full, all commitments related to any
existing credit facility shall be terminated and all Liens securing payment of
any such Indebtedness shall be released and the Administrative Agent shall
receive such evidence of the foregoing including all pay off letters,
termination statements, releases or other instruments, as may be suitable or
appropriate in connection therewith.
5.1.10 Payment of Closing Fees, Expenses, etc. The Administrative
Agent shall have received for its own account or for the account of each
Lender or the Arranger, as the case may be, (including to the extent requested
by Comercial, from the proceeds of the initial Borrowing) all fees, costs and
expenses due and payable pursuant to Section 3 and, if then invoiced, Section
12.1.
5.1.11 Intercompany Loan. Vitro shall have refinanced 51% of an
existing 62,540,000 Peso intercompany loan owed by Comercial to Servicios y
Operaciones Financieras Vitro pursuant to the terms of the Intercompany Note
and the Administrative Agent shall have received an executed copy of such
Intercompany Note executed by each of Comercial, as borrower, and Servicios y
Operaciones Financieras Vitro, as lender, together with evidence of
satisfaction in full of the remaining 49% of such existing Peso intercompany
loan and a consent from Servicios y Operaciones Financieras Vitro in form and
substance satisfactory to the Administrative Agent.
5.1.12 Accelerated Product Payment by Crisa Ltd. The Administrative
Agent shall have received an executed copy of the Accelerated Product Payment
Agreement executed by each of Crisa Ltd. and Comercial, together with evidence
of receipt by Comercial of any amounts required to be paid thereunder prior to
the Effective Date.
5.1.13 Leverage Ratio. Vitrocrisa's and Comercial's ratio of
Consolidated Indebtedness to Combined Operating Cash Flow (determined on a
combined basis for Vitrocrisa
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and Comercial) as of September 30, 2003 and as of December 31, 2003 shall
not have exceeded 3.00 to 1.0.
5.1.14 Consolidated Indebtedness. Consolidated Indebtedness of
Vitrocrisa and Comercial (determined on a combined basis) shall not exceed
U.S.$77,500,000 as of the date of the initial Borrowing. 5.1.15 Accounts and
Required Reserve Amount. HSBC Bank USA shall have opened the Vitrocrisa
Comercial Collection Account and the Reserve Account with the Collateral Agent
and, Comercial simultaneous with, and from the proceeds of, the initial
Borrowing, shall have deposited into the Reserve Account an amount equal to
the Required Reserve Amount as of the Closing Date, and Crisa Ltd. shall have
opened the Libbey Collection Account with the Collateral Agent.
5.1.16 Letter Referenced in Schedule V. Each of the parties hereto
shall have executed and delivered to the Administrative Agent.
5.2 Conditions Precedent to Each Borrowing. The obligation of each
Lender to make Loans on each Borrowing Date (including the initial Borrowing
Date) is subject, at the time of the request of such Borrowing and at the time
of such Borrowing, to the satisfaction of the following additional conditions
precedent:
5.2.1 Notice of Borrowing. Comercial shall have delivered to the
Administrative Agent a Notice of Borrowing with respect to the Loans to be
made on such Borrowing Date meeting the requirements of Section 2.2.
5.2.2 Payments. Simultaneously, all Fees and other amounts required
to be paid or deposited on or prior to such Borrowing Date under this
Agreement and the other Transaction Documents shall have been paid or
deposited.
5.2.3 No Material Adverse Change. Nothing shall have occurred since
December 31, 2002 (and the Lenders shall have become aware of no facts or
conditions not previously known), which the Administrative Agent shall
determine has, or could reasonably be expected to have, a Material Adverse
Effect on Comercial, Vitrocrisa or any US Affiliate.
5.2.4 No Default; Representations and Warranties. At the time of any
Borrowing (and after giving effect thereto) (i) there shall exist no Default
or Event of Default and (ii) all representations and warranties contained
herein and in the other Transaction Documents shall be true and correct in all
material respects with the same effect as though such representations and
warranties had been made on and as of the date of such Borrowing Date (it
being understood and agreed that any representation or warranty which by its
terms is made as of a specified date shall be required to be true and correct
in all material respects only as of such specified date).
5.2.5 Accounts Receivable Report. Comercial shall have provided to
the Administrative Agent an Accounts Receivable Report providing shipping
details of exports, together with such shipping or other documents as the
Administrative Agent or the Lenders may reasonably request with respect to all
accounts receivable and other amounts payable to
33
Comercial or any US Affiliate arising from or related to exports made directly
or indirectly by Comercial including, without limitation, all those arising
from sales by the US Affiliates of products or other assets sold by Comercial.
5.2.6 Notes. Each Lender having a Tranche A Term Commitment (or the
Administrative Agent on its behalf) shall have received a duly executed and
signed por aval Tranche A Term Note with respect to any Tranche A Term Loans
requested meeting the requirements of Section 2.4, each Lender having a
Tranche A Revolving Commitment (or the Administrative Agent on its behalf)
shall have received a duly executed and signed por aval Tranche A Revolving
Note with respect to any Tranche A Revolving Loans requested meeting the
requirements of Section 2.4, and each Lender having a Tranche B Commitment (or
the Administrative Agent on its behalf) shall have received a duly executed
and signed por aval Tranche B Note with respect to any Tranche B Loans
requested meeting the requirements of Section 2.4.
5.2.7 Clean Down Period. In the case of a Borrowing consisting of
Tranche A Revolving Loans, the date on which such Borrowing is requested to be
made shall not occur during a Clean Down Period.
The acceptance of the proceeds of a Borrowing shall constitute a
representation and warranty by Comercial to the Administrative Agent and each
of the Lenders that all the conditions which Comercial is required to meet as
specified in this Section 5 and applicable to such Borrowing have been
fulfilled in accordance with the terms hereof. All of the Notes, certificates,
legal opinions and other documents and papers referred to in this Section 5,
unless otherwise specified, shall be delivered to the Administrative Agent at
the Notice Office for the account of each of the Lenders and in sufficient
counterparts or copies for each of the Lenders and shall, unless otherwise
specified, be in form and substance satisfactory to the Administrative Agent
and the Lenders.
Section 6. Representations, Warranties and Agreements.
In order to induce the Lenders to enter into this Agreement, to
issue their respective commitments and to make the Loans, each of Vitrocrisa
and Comercial makes the following representations, warranties and agreements,
all of which shall survive the execution and delivery of this Agreement and
the Notes and the making of the Loans, with the occurrence of each Borrowing
being deemed to constitute a representation and warranty that the matters
specified in this Section 6 are true and correct on and as of the date of such
Borrowing (it being understood and agreed that any representation or warranty
which by its terms is made as of a specified date shall be required to be true
and correct in all material respects only as of such specified date).
6.1 Legal Status. Each of Vitrocrisa, Comercial and their
Subsidiaries (i) is a duly organized and validly existing corporation
(sociedad de responsabilidad limitada de capital variable in the case of
Vitrocrisa and Comercial) or other business entity in good standing under the
laws of the jurisdiction of its incorporation or organization (except, in the
case of good standing, in any jurisdiction that does not recognize such
concept), (ii) has the power and authority to own its property and assets and
to transact the business in which it is engaged and to
34
do all things necessary or appropriate in respect of its business and (iii) is
duly qualified and is authorized to do business and is in good standing in
each jurisdiction where the ownership, leasing or operation of its property or
the conduct of its business requires such qualification, except for failures
to be so qualified which, in the aggregate, could not reasonably be expected
to have a Material Adverse Effect on Vitrocrisa or Comercial.
6.2 Power and Authority. Each of Vitrocrisa and Comercial has the
power and authority to execute, deliver and perform the terms and provisions
of each of the Transaction Documents to which it is a party. Duly authorized
or empowered representatives of Vitrocrisa and Comercial have, or, in the case
of the Transaction Documents other than this Agreement, will have, duly
executed and delivered each of the Transaction Documents on behalf of
Vitrocrisa and Comercial, and each such Transaction Document constitutes or,
when executed and delivered, will constitute, its legal, valid and binding
obligation enforceable in accordance with its terms, except to the extent that
the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws generally
affecting creditors' rights and by equitable principles (regardless of whether
enforcement is sought in equity or at law).
6.3 No Immunity. Neither Vitrocrisa nor Comercial nor any of their
respective properties has any immunity from the jurisdiction of any court or
from setoff or any legal process (whether through service of notice,
attachment prior to judgment, attachment in aid of execution, execution or
otherwise) under the laws of any jurisdiction, including the laws of Mexico.
6.4 No Violation. Neither the execution, delivery or performance by
Vitrocrisa or Comercial of the Transaction Documents to which each is a party,
nor compliance by each with the terms and provisions thereof, nor the use of
the proceeds of the Loans as contemplated herein, will (i) contravene any
provision of any law, statute, rule or regulation or any order, writ,
injunction or decree of any court or governmental instrumentality binding on
Vitrocrisa or Comercial, (ii) conflict or be inconsistent with or result in
any breach of any of the terms, covenants, conditions or provisions of, or
constitute a default in respect of, or result in the creation or imposition of
(or the obligation to create or impose) any Lien upon any of the property or
assets of Vitrocrisa or Comercial or pursuant to the terms of any material
indenture, mortgage, deed of trust, credit agreement, or any other agreement,
contract or instrument to which Vitrocrisa or Comercial is a party or by which
Vitrocrisa's or Comercial's respective properties or assets is bound or to
which Vitrocrisa, or Comercial may be subject, or (iii) violate any provision
of the articles of incorporation (acta constitutiva) or bylaws (estatutos
sociales) or other organizational documents of Vitrocrisa or Comercial. Each
of Vitrocrisa and Comercial is in compliance in all material respects with all
such indentures, mortgages, deeds of trust, credit agreements, or other
agreements, contracts or instruments.
6.5 Governmental Approvals. No Governmental Approval is required to
authorize, or is required in connection with (i) the execution, delivery and
performance by Vitrocrisa and Comercial of any Transaction Document, or (ii)
the legality, validity, binding effect or enforceability against Vitrocrisa
and Comercial of any such Transaction Document.
35
6.6 Litigation. There is no litigation, action, suit, investigation,
claim or proceeding pending or, to the knowledge of Vitrocrisa or Comercial,
threatened with respect to this Agreement or any other Transaction Document or
the transactions contemplated hereby. There is no litigation, action, suit,
investigation, claim or proceeding pending or, to the knowledge of Vitrocrisa
or Comercial, threatened which could reasonably be expected to have a Material
Adverse Effect on Vitrocrisa or Comercial.
6.7 Financial Statements; No Material Adverse Change; Liens.
(a) (i) The combined balance sheet of Comercial and Vitrocrisa as at
December 31, 2002, and each of the related statements of income and retained
earnings and changes in financial position of such Person for the twelve-month
period then ended, and (ii) the combined balance sheet of Comercial and
Vitrocrisa as at September 30, 2003, and the related statements of income and
retained earnings and changes in financial position of such Person for the
nine-month period then ended, heretofore furnished to the Administrative Agent
were prepared in accordance with GAAP and, on that basis, fairly present the
financial condition and results of operations of such Person as at the dates
and for the periods covered thereby, subject to, in the case of the financial
statements described in clause (ii) above, the absence of certain footnotes
and normal recurring year-end adjustments.
(b) Since December 31, 2002, there has been no material adverse
change in the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of Vitrocrisa, Comercial, or any US
Affiliate.
(c) Except as fully disclosed in the financial statements referred
to in Section 6.7(a), there are no liabilities or obligations with respect to
Comercial or Vitrocrisa or their respective Subsidiaries of any nature
whatsoever (whether absolute, accrued, contingent or otherwise and whether or
not due) which, either individually or in the aggregate, would be material to
Comercial or Vitrocrisa. Vitrocrisa and Comercial know of no basis for the
assertion against Comercial or Vitrocrisa or their respective Subsidiaries of
any liability or obligation of any nature whatsoever that is not fully
disclosed in the financial statements referred to in Section 6.7(a) which,
either individually or in the aggregate, are reasonably likely to have a
Material Adverse Effect on Comercial or Vitrocrisa.
(d) Schedule IV sets forth a true and complete list of Liens
securing Indebtedness of Vitrocrisa, Comercial and their Consolidated
Subsidiaries as of the Closing Date.
6.8 Use of Proceeds. The proceeds of (a) the Tranche A Loans and the
Tranche B Loans will be used (i) to pay fees, costs and expenses incurred in
connection with the preparation and execution of the Transaction Documents and
the transactions contemplated thereby (including the fees contemplated by
Section 3) and to fund the initial Required Reserve Amount, and (ii) to repay
in full the Indebtedness to be Paid, together with all interest, all
prepayment premiums and other amounts due and payable with respect thereto,
and (b) the Tranche A Revolving Loans will be used for working capital
purposes; provided, that, without limiting the generality of the foregoing, it
is understood and agreed that the proceeds of the Tranche A Revolving Loans
shall not be used for any of the following: (1) for making payments
36
under the Intercompany Note, (2) for making payments with respect to any other
Indebtedness incurred after the Closing Date other than Indebtedness permitted
to be incurred pursuant to Section 8.3, or (3) for making dividends or
distributions or other payments to Affiliates of Comercial or Vitrocrisa.
Neither Vitrocrisa nor Comercial is engaged, nor is contemplating engaging, in
the business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock and no proceeds of any Loan
will be used: (A) to acquire any equity security of a class that is registered
pursuant to Section 12 of the Securities Exchange Act of 1934, (B) to acquire
or carry any Margin Stock or (C) to extend credit to others for the purpose of
acquiring or carrying Margin Stock (it being understood that neither
Vitrocrisa nor Comercial is hereby prohibited from investing its pension plan
assets in any manner otherwise permitted by this Agreement and applicable
Law).
6.9 Properties. Each of Vitrocrisa, Comercial and their Subsidiaries
has good and marketable title to all properties owned by it, free and clear of
all Liens other than Permitted Liens. With respect to any lease or rental
agreement to which Vitrocrisa, Comercial or any of their Subsidiaries is a
party, (i) such lease or rental agreement is in full force and effect, (ii)
each of Vitrocrisa, Comercial and their Subsidiaries has complied in all
material respects with all of the terms of such lease or rental agreement,
(iii) there exists no event of default or an event, act or condition (other
than defaults or conditions which are not reasonably likely to have a Material
Adverse Effect on Vitrocrisa or Comercial) which with notice or lapse of time,
or both, would constitute an event of default thereunder by Vitrocrisa,
Comercial or any of their Subsidiaries or, to the knowledge of Vitrocrisa and
Comercial, the lessor thereunder, and (iv) Vitrocrisa, Comercial or their
Subsidiaries, as the case may be, is in possession of the premises demised
under all such leases and rental agreements and is conducting business on such
premises.
6.10 Patents, Licenses, Franchises and Formulas. Each of Vitrocrisa,
Comercial and their Subsidiaries owns all the material patents, trademarks,
permits, service marks, trade names, copyrights, licenses, franchises and
formulas, or rights with respect to the foregoing, or has obtained assignments
of all leases and other rights of whatever nature, necessary for the present
conduct of its business, without any known conflict with the rights of others.
6.11 True and Complete Disclosure. All factual information (taken as
a whole) heretofore or contemporaneously furnished by or on behalf of
Vitrocrisa or Comercial (including, without limitation, such factual
information as contained in the Transaction Documents), for purposes of or in
connection with this Agreement or any transaction contemplated herein or in
any Transaction Document is, and all other such factual information (taken as
a whole) hereafter furnished by or on behalf of Vitrocrisa or Comercial to the
Administrative Agent, the Collateral Agent or any Lender will be, true and
accurate in all material respects on the date as of which such information is
dated or certified and not incomplete by omitting to state any material fact
necessary to make such information (taken as a whole) not misleading at such
time in light of the circumstances under which such information was provided.
There is no material fact or circumstance which could reasonably be expected
to have a Material Adverse Effect on Vitrocrisa or Comercial which has not
been disclosed herein or in such other documents, certificates and statements
furnished to the Lenders for use in connection with the transactions
contemplated hereby and there are in existence no documents or
37
agreements which have not been disclosed to the Lenders which are material in
the context of the Transaction Documents or which have the effect of varying
any of the Transaction Documents.
6.12 Tax Returns and Payments. Each of Vitrocrisa, Comercial and
their Subsidiaries has filed all material Mexican, United States or applicable
foreign, federal, state and local income tax returns and all other material
tax returns and reports required to be filed by it and has paid all taxes
payable by it which have become due pursuant to such tax returns and all other
taxes and assessments payable by it which have become due, other than those
not yet delinquent and except for those diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP have been established.
6.13 Employee Benefit Plans. Each of Vitrocrisa, Comercial and their
Subsidiaries is in compliance in all material respects with its respective
obligations relating to all employee benefit plans established, maintained or
contributed to by it, and none of Vitrocrisa, Comercial or any of their
Subsidiaries has any outstanding material liabilities with respect to any such
employee benefit plans which is not properly reflected in the financial
statements delivered pursuant to Section 6.7(a).
6.14 Labor Relations. None of Vitrocrisa, Comercial or any of their
Subsidiaries has engaged in any unfair labor practice that could reasonably be
expected to have a Material Adverse Effect on it. Except for instances that
could not have a Material Adverse Effect on Comercial or Vitrocrisa or on
Vitrocrisa, Comercial and their Subsidiaries taken as a whole, there is (i) no
unfair labor practice complaint pending against Vitrocrisa, Comercial or any
of their Subsidiaries, or, to the knowledge of Comercial and Vitrocrisa,
threatened against Vitrocrisa, Comercial or any of their Subsidiaries, before
any governmental body or any political subdivision thereof with
responsibility, authority or jurisdiction for such matters, and no significant
grievance or significant arbitration proceeding arising out of or under any
collective bargaining agreement is so pending against Vitrocrisa, Comercial or
any of their Subsidiaries, or, to the knowledge of Comercial and Vitrocrisa,
threatened against Vitrocrisa, Comercial or any of their Subsidiaries, (ii) no
strike, labor dispute, general slowdown or stoppage pending against
Vitrocrisa, Comercial or any of their Subsidiaries, or, to the knowledge of
Comercial and Vitrocrisa, threatened against Vitrocrisa, Comercial or any of
their Subsidiaries, (iii) to the knowledge of Comercial and Vitrocrisa, no
union representation question existing with respect to the employees of
Vitrocrisa, Comercial and their Subsidiaries and, to the knowledge of
Comercial and Vitrocrisa, no union organizing activities with respect to
Vitrocrisa, Comercial or any of their Subsidiaries are taking place.
6.15 Capitalization. (a) As of the Closing Date, the authorized
capital of Vitrocrisa consists of 4 equity interests (partes sociales), all of
which are issued, outstanding, and fully paid; such equity interests are
directly or indirectly owned 51.0% by Vitro and 49.0% by Libbey. Vitrocrisa
does not have outstanding (i) any securities convertible into or exchangeable
for its equity interests or (ii) any rights to subscribe for or to purchase,
or any options for the purchase of, or any agreements, arrangements or
understandings providing for the issuance (contingent or otherwise) of, or any
calls, puts, commitments or claims of any character relating to, its equity
interests.
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(b) As of the Closing Date, the authorized capital of Comercial
consists of 4 equity interests (partes sociales), all of which are issued,
outstanding, and fully paid; such equity interests are directly or indirectly
owned 51.0% by Vitro and 49.0% by Libbey. Comercial does not have outstanding
(i) any securities convertible into or exchangeable for its equity interests
or (ii) any rights to subscribe for or to purchase, or any options for the
purchase of, or any agreements, arrangements or understandings providing for
the issuance (contingent or otherwise) of, or any calls, puts, commitments or
claims of any character relating to, its equity interests.
6.16 Subsidiaries. Neither Vitrocrisa nor Comercial has any
Subsidiaries as of the Closing Date, and thereafter, neither Vitrocrisa nor
Comercial shall have any Subsidiaries, except such Subsidiaries (a) about
which Vitrocrisa or Comercial, as the case may be, shall have provided written
notice to the Administrative Agent prior to the formation or acquisition
thereof, and (b) formed or acquired with the consent of the Supermajority
Lenders and otherwise in compliance with the provisions hereof.
6.17 Compliance with Statutes, etc. Each of Vitrocrisa, Comercial
and their Subsidiaries is in compliance in all respects with all applicable
Laws (including all Environmental Laws) imposed by all Government Agencies,
domestic or foreign, in respect of the conduct of its business and the
ownership of its property, except such noncompliance as could not reasonably
be expected to have a Material Adverse Effect on Vitrocrisa, Comercial or on
Vitrocrisa, Comercial and their Subsidiaries taken as a whole.
6.18 Availability and Transfer of Foreign Currency. No foreign
exchange control approvals or other authorizations by Mexico or any other
applicable Government Agency thereof are required to assure the availability
of Dollars to enable Vitrocrisa or Comercial to perform all of its obligations
under each Transaction Document to which it is a party in accordance with the
terms thereof. There are no restrictions or requirements which limit the
availability or transfer of foreign exchange for the purpose of the
performance by Vitrocrisa or Comercial of its obligations under this Agreement
or any other Transaction Document to which it is a party.
6.19 Fees and Enforcement. No fees or taxes, including, without
limitation, stamp, transaction, registration or similar taxes, are required to
be paid for the legality, validity, or enforceability of this Agreement or any
of the other Transaction Documents. This Agreement and each other Transaction
Document is in proper legal form under the laws of Mexico, and under the
respective governing laws selected in such Transaction Documents, for the
enforcement thereof in such jurisdiction without any further action by
Comercial, Vitrocrisa, the Administrative Agent or the Lenders.
6.20 Investment Company Act. Neither Comercial nor Vitrocrisa is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
6.21 Public Utility Holding Company Act. Neither Comercial nor
Vitrocrisa is a "holding company," or a "subsidiary company" of a "holding
company," or an "Affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
39
6.22 Solvency. Each of Comercial, Vitrocrisa and (to Comercial's and
Vitrocrisa's knowledge) each US Affiliate is Solvent as of the Closing Date
and as of the date of Borrowing both before and after giving effect to such
Borrowing.
6.23 Other Creditors. Vitrocrisa has no creditors.
6.24 Pari Passu Status, etc. The payment Obligations of Comercial
and Vitrocrisa under this Agreement and the other Transaction Documents to
which each is a party rank pari passu in priority of payment with all and any
other senior unsecured Indebtedness of Comercial and Vitrocrisa, as
applicable, and the Tranche A Loans secured by the Collateral Documents have
priority of payments with respect to the collateral purported to be covered by
the Collateral Documents as provided in Section 12.12, and the liens granted
under the Collateral Documents to secure the Obligations due with respect to
the Tranche A Loans are first priority perfected liens in the collateral
purported to be covered by the Collateral Documents.
Section 7. Affirmative Covenants.
Each of Comercial and Vitrocrisa covenants and agrees that on and
after the Closing Date and until the Loans, together with all accrued
interest, Fees, costs, expenses and all other amounts with respect thereto,
are paid in full:
7.1 Information Covenants.
Comercial and Vitrocrisa, as applicable, will furnish or cause to be
furnished to the Administrative Agent for distribution to each Lender:
(a) Quarterly Financial Statements of Vitrocrisa and Comercial. As
soon as available, but, in any event, within 60 days after the close of each
quarterly accounting period in each fiscal year of Vitrocrisa and Comercial, a
copy of the unaudited, combined balance sheet of Vitrocrisa, Comercial and
their Consolidated Subsidiaries for such period, together with the related
statements of income and retained earnings and statements of changes in
financial position for such quarterly period, certified, with respect to each
of Vitrocrisa and Comercial, by the principal executive officer, the principal
financial officer or another authorized executive officer of such company, who
in such capacity has actual knowledge of the matters to which he or she is
certifying, as prepared in accordance with GAAP consistently applied, subject
to normal recurring year-end adjustments and the absence of certain footnotes
to such financial statements.
(b) Quarterly Financial Statements of Crisa Ltd. As soon as
available, but, in any event, within 60 days after the close of each quarterly
accounting period in each fiscal year of Crisa Ltd., a copy of the unaudited
balance sheet of Crisa Ltd. for such period, together with the related
statements of income and retained earnings and statements of changes in
financial position for such quarterly period, certified by the principal
executive officer, the principal financial officer or another authorized
executive officer of Crisa Ltd., who in such capacity has actual knowledge of
the matters to which he or she is certifying, as prepared in accordance with
GAAP consistently applied, subject to normal recurring year-end adjustments
and the absence of certain footnotes to such financial statements.
40
(c) Annual Financial Statements of Vitrocrisa and Comercial. As soon
as available, but, in any event, within 120 days after the close of each
fiscal year of Vitrocrisa and Comercial, the audited combined balance sheet of
Vitrocrisa, Comercial, and their respective Consolidated Subsidiaries for such
fiscal year, together with the related audited combined statements of income
and retained earnings and statements of changes in financial position for such
fiscal year certified by independent public accountants of recognized
international standing selected by Vitrocrisa and Comercial, and in each case
pursuant to an unqualified opinion of such independent public accountants, and
together with a report of such accounting firm stating that in the course of
its regular audit of the combined financial statements of Vitrocrisa,
Comercial, and their respective Consolidated Subsidiaries, which audit was
conducted in accordance with GAAP consistently applied, such accounting firm
obtained no knowledge of any Default or Event of Default.
(d) Annual Financial Statements of Crisa Ltd. As soon as available,
but, in any event, within 120 days after the close of each fiscal year of
Crisa Ltd. ending on or after December 31, 2004, the audited consolidated
balance sheet of Crisa Ltd. and its Consolidated Subsidiaries for such fiscal
year, together with the related audited consolidated statements of income and
retained earnings and statements of changes in financial position for such
fiscal year certified by independent public accountants of recognized
international standing selected by Crisa Ltd., and pursuant to an unqualified
opinion of such independent public accountants.
(e) Management Letters. As soon as available, but, in any event,
within 30 days after Vitrocrisa's or Comercial's receipt thereof, a copy of
any "management letter" or other similar communication received by Vitrocrisa
or Comercial from its auditors which (i) pertains to a material issue raised
by Vitrocrisa's or Comercial's auditors in connection with their audit and/or
review of Vitrocrisa's or Comercial's financial, accounting and other systems,
management or accounts, or (ii) reflects any material disagreement regarding
the preparation of Vitrocrisa's or Comercial's financial statements or the
information reflected therein.
(f) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Section 7.1(a) and (c), a certificate in
substantially the form of Exhibit R or such other form acceptable to the
Administrative Agent signed, with respect to each of Vitrocrisa and Comercial,
by the principal executive officer, the principal financial officer or another
authorized executive officer of such company, who in such capacity has actual
knowledge of the matters to which he or she is certifying, to the effect that,
to the best of his or her knowledge, no Default or Event of Default has
occurred and is continuing, and setting forth the calculations required to
establish compliance by Vitrocrisa and Comercial with the provisions of
Sections 7.19, 7.20, 8.1(f), 8.1(g), 8.2, 8.3(b), 8.4(c), 8.7, 8.8, 8.9, 8.17,
8.18, 8.19, 8.20, and 8.21 at the end of such fiscal quarter or year, as the
case may be.
(g) Notice of Default or Litigation, etc. Promptly upon an officer
of Vitrocrisa or Comercial obtaining knowledge thereof, written notice of (i)
the occurrence of any event which constitutes a Default or Event of Default
(including the details thereof and the action that Vitrocrisa or Comercial has
taken or proposes to take with respect thereto), (ii) any material action,
litigation, suit or governmental proceeding pending or threatened against
Vitrocrisa or Comercial before any court or governmental department,
commission, board, bureau, agency or instrumentally, domestic or foreign (x)
which could reasonably be expected to have a Material
41
Adverse Effect on Vitrocrisa or Comercial or (y) with respect to any
Transaction Document, and (iii) any other event which could reasonably be
expected to have a Material Adverse Effect on Vitrocrisa or Comercial.
(h) Monthly Accounts Receivable Report. As soon as available, but,
in any event, by a date no later than fifteen (15) days after the end of each
calendar month a report providing details of all accounts receivable or other
amounts payable to Comercial, Vitrocrisa, or any of their Consolidated
Subsidiaries or US Affiliates, including without limitation, the amount of any
receivables that are known to be subject to a factoring agreement and the
relevant discount rate under any such agreement, the amount of total
collections of receivables or other amounts payable to Comercial arising from
or relating to exports made directly or indirectly by Comercial and deposited
in the Vitrocrisa Comercial Collection Account and the amount of total
collections of receivables or other amounts payable to Comercial or any US
Affiliate and deposited in the Libbey Collection Accounts, as well as such
other documents as the Administrative Agent or the Lenders may reasonably
request with respect to such accounts receivable or collection of receivables.
(i) Annual Business Forecasts. Promptly after the end of each
calendar year, but in any event within ninety (90) days after the end of each
calendar year, business forecasts for the following calendar year for each of
Vitrocrisa and Comercial in a form acceptable to the Administrative Agent that
includes, without limitation, summaries of such company's balance sheet,
income statement and cash flow statement for the relevant year.
(j) Consents. Within thirty (30) days after the Closing Date, each
Consent (other than the Consent required by Section 5.1.1(vii)) that is not
delivered to the Administrative Agent on the Closing Date, duly executed by
the parties thereto.
(k) Other Information. From time to time, such other information or
documents (financial, fiscal or otherwise) as any Lender and/or the
Administrative Agent may reasonably request.
7.2 Books, Records and Inspections; Accounting Matters; Provision of
Certain Financial Statements. Each of Vitrocrisa and Comercial shall, and
shall cause each of their Subsidiaries to, keep proper books of record and
account adequate to reflect truly and fairly the financial condition and
results of operations of Vitrocrisa, Comercial and their Subsidiaries and in
which full, true and correct entries in conformity with GAAP consistently
applied and all requirements of Law shall be made of all dealings and
transactions in relation to its business and activities. Throughout the term
of the Transaction Documents and until all principal and interest accrued
hereunder is paid in full, upon prior written notification, Vitrocrisa and
Comercial shall afford to the employees, agents, officers and authorized
representatives of the Administrative Agent or any Lender reasonable access to
Vitrocrisa's, Comercial's and their Subsidiaries' properties and facilities,
offices, files, books and records.
7.3 Compliance with Statutes, etc. Each of Comercial and Vitrocrisa
will, and will cause each of their Subsidiaries to comply with all applicable
Laws imposed by all Governmental Agencies (including all applicable
Environmental Laws), except where the failure
42
to so comply could not reasonably be expected to have a Material Adverse
Effect on Comercial or Vitrocrisa.
7.4 Taxes; Labor. Each of Comercial and Vitrocrisa will, and will
cause each of their Subsidiaries to, pay and discharge or cause to be paid and
discharged (i) all applicable material Mexican, United States or applicable
foreign federal, state and local income taxes (including stamp taxes),
assessments and governmental charges or levies imposed upon it or upon its
income or profits or upon any of its property, real, personal or mixed or upon
any part thereof, when due, except those diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with
GAAP have been established, and (ii) all valid claims for labor, materials and
supplies which, if unpaid might by law become a Lien upon such property
(except to the extent permitted by Section 8.1).
7.5 Corporate Franchises, etc. Each of Comercial and Vitrocrisa
will, and will cause each of their Subsidiaries to, do or cause to be done all
things necessary to preserve and keep in full force and effect its existence
and its material patents, trademarks, permits, service marks, trade names,
copyrights, licenses, franchises, formulas, or rights with respect to the
foregoing; provided, however, that nothing in this Section 7.5 shall prevent
the withdrawal by Comercial, Vitrocrisa or their Subsidiaries of their
respective qualification as a foreign corporation in any jurisdiction where
such withdrawal could not reasonably be expected to have a Material Adverse
Effect on Comercial or Vitrocrisa or from discontinuing its existence as
permitted by and in strict compliance with Section 8.5(b), in which case, all
restrictions and limitations regarding Comercial or Vitrocrisa, as applicable,
shall apply to the surviving entity.
7.6 Maintenance of Property, Insurance. Each of Comercial and
Vitrocrisa shall, and shall cause their Subsidiaries to:
(a) maintain all property useful or necessary in their business in
good working order and condition, ordinary wear and tear excepted; and
(b) maintain liability insurance, and maintain all types of
insurance, in each case, with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas as Comercial, Vitrocrisa or such Subsidiary, as the case
may be, operates.
7.7 Use of Proceeds. Comercial shall use the proceeds of the Loans
solely as set forth in the first sentence of Section 6.8.
7.8 Conduct of Business. Each of Comercial and Vitrocrisa will, and
will cause each of their Subsidiaries to, continue to engage principally in
business of the same general type as now conducted, and preserve, renew and
keep in full force and effect their respective corporate existences and their
respective rights, privileges, franchises and concessions necessary or
desirable in the normal conduct of business; provided, however, that each of
Comercial, Vitrocrisa and such Subsidiaries shall not be prevented from
discontinuing those operations or disposing of or suspending the maintenance
of those properties which, in its reasonable judgment, are no longer necessary
or useful in the conduct of its business or from discontinuing
43
its existence if permitted by Section 8.5(b). All books, records, files and
financial records shall continue to be prepared and maintained by Comercial or
Vitrocrisa as currently executed.
7.9 Governmental Licenses, etc. Each of Comercial and Vitrocrisa
will, and will cause each of their Subsidiaries to, promptly obtain and
maintain at all times at its own expense all such material governmental
licenses, registrations, authorizations, consents, permits and approvals
(including without limitation, foreign exchange control approvals) as may be
required to comply with its obligations, preserve its rights and consummate
the transactions contemplated under the Transaction Documents. Without
limiting the generality of the foregoing covenant, each of Comercial and
Vitrocrisa specifically agrees, if necessary, to register with any applicable
required Governmental Agency the transactions contemplated hereby, including
without limitation, the making, funding or repayment of the Loans.
7.10 Performance of Obligations. Each of Comercial and Vitrocrisa
shall, and shall cause each of their Subsidiaries to, perform all of its
obligations under each Transaction Document to which it is a party. Except for
the exercise of any right under applicable Law or any agreement, each of
Comercial and Vitrocrisa also shall, and shall cause each of its Subsidiaries
to, pay all their respective material obligations and liabilities when due,
including:
(a) all operating agreements, indentures, mortgages, deeds of trust,
credit agreements and other material contracts;
(b) all valid claims that, if unpaid when due, would by applicable
law result in a Lien upon its properties other than a Permitted Lien, and
(c) all Indebtedness as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
7.11 Compliance with Terms of Leaseholds. Each of Comercial and
Vitrocrisa shall, and shall cause each of their Subsidiaries to, make all
payments and otherwise perform in all material respects all obligations in
respect of all material leases of real property, and, to the extent material
to the business of such Persons, keep such leases in full force and effect and
not allow such leases to lapse or be terminated or right to renew such leases
to be forfeited or canceled, except where the failure to do so (individually
or in the aggregate) could not reasonably be expected to have a Material
Adverse Effect on Comercial or Vitrocrisa.
7.12 Maintenance of Pari Passu Status; Priority of Liens. Each of
Comercial and Vitrocrisa will take all actions necessary to ensure that (i)
the payment Obligations of Comercial and Vitrocrisa under this Agreement and
the other Transaction Documents to which each is a party shall at all times
rank pari passu in priority of payment with all and any other senior unsecured
Indebtedness of Comercial and Vitrocrisa, as applicable; provided, that the
Tranche A Loans shall be secured by the Collateral Documents and shall have
priority of payments with respect to the collateral purported to be covered by
the Collateral Documents as provided in Section 12.12, and (ii) the liens
granted under the Collateral Documents to secure the Obligations due with
respect to the Tranche A Loans, shall be first priority perfected liens in the
collateral purported to be covered by the Collateral Documents.
44
7.13 Future Subsidiaries. Promptly, and in any event within 30 days
(in the case of the item set forth in clause (a)) or 45 days (in the case of
the items set forth in clauses (b), (c), (d), (e) and (f)) of the date on
which Comercial or Vitrocrisa acquires or creates a Subsidiary, Comercial or
Vitrocrisa, as the case may be, shall cause such Subsidiary to execute and
deliver (a) a counterpart of the Subsidiary Guaranty, (b) certified copies of
(i) its articles of incorporation and by-laws in effect, (ii) resolutions of
its board of directors authorizing the execution, delivery and performance of
the Subsidiary Guaranty, (iii) if applicable, powers of attorney granted by
such Subsidiary to the persons executing the Subsidiary Guaranty on its
behalf, (iv) if applicable, powers of attorney granted by such Subsidiary to
the Process Agent and (v) all other documents evidencing other necessary
corporate action and governmental approvals, if any, with respect to the
Subsidiary Guaranty and the transactions contemplated thereby, (c) a
certificate of the Secretary or Assistant Secretary of such Subsidiary
certifying the names and true signatures of its officers authorized to sign
the Subsidiary Guaranty and the other documents to be delivered by it
hereunder, (d) a duly executed letter from the Process Agent, substantially in
the form attached hereto as Exhibit E, confirming its appointment as agent to
accept service of process, (e) a favorable opinion of New York counsel
regarding the enforceability of such Subsidiary Guaranty and (f) a favorable
opinion of local counsel to such Subsidiary regarding the existence, good
standing, non-contravention with laws or other agreements of such Subsidiary,
and the due authorization, execution, delivery and enforceability of such
Subsidiary Guaranty.
7.14 Further Assurances. Each of Comercial and Vitrocrisa shall do
and perform, and shall cause each of their Subsidiaries to do and perform,
from time to time, any and all acts (and execute any and all documents) as may
be necessary or as may be reasonably requested by the Administrative Agent,
the Collateral Agent or any Lender or Lenders in order to effect the purposes
of the Transaction Documents, including without limitation, creating and
maintaining the first priority of the liens purported to be granted under the
Collateral Documents.
7.15 Process Agent. Each of Comercial and Vitrocrisa shall, within
30 days of the Closing Date, in connection with the appointment of the Process
Agent, deliver to the Administrative Agent evidence that a power of attorney
contained in a notarial instrument has been granted.
7.16 Security. The Tranche A Loans shall be secured by a first
priority perfected lien and security interest in the collateral granted
pursuant to the Collateral Documents. The Collateral Agent shall have the
rights set forth in the Collateral Documents and under applicable law with
respect to such collateral.
7.17 Vitrocrisa Comercial Collection Account. Comercial shall at all
times maintain with the Collateral Agent a special depository account which
shall be titled the "Vitrocrisa Comercial Collection Account" and which shall
be in the name and under the control of the Collateral Agent. Comercial shall
irrevocably direct all account debtors, and shall cause all account debtors to
agree, to pay all amounts due to Comercial directly into the Vitrocrisa
Comercial Collection Account and, to the extent that notwithstanding such
instructions, Comercial receives payment of amounts due with respect to any
account or other amount payable to Comercial arising from or related to the
export of products or goods by Comercial, Comercial shall deposit or caused to
be deposited such collections including any amounts paid on account of accrued
interest thereon, into the Vitrocrisa Comercial Collection Account. All
amounts from
45
time to time deposited into the Vitrocrisa Comercial Collection Account shall
be invested, held and distributed in accordance with the Security Agreement
entered into by and among Comercial, the Collateral Agent and the
Administrative Agent.
7.18 Reserve Account. Comercial shall maintain at the Collateral
Agent a special trust account which shall be titled the "Reserve Account" and
which shall be in the name and under the control of the Collateral Agent (the
"Reserve Account"). Comercial shall maintain at all times on deposit in the
Reserve Account an amount (such amount as of any date being the "Required
Reserve Amount") equal to the greater of (x) $2,000,000 and (y) an amount
equal to the sum of the amount of principal plus accrued interest scheduled to
be paid during the immediately following calendar quarter with respect to
Tranche A Term Loans plus the amount of accrued interest scheduled to be paid
with respect to the Tranche A Revolving Loans during the immediately following
calendar quarter. At the Closing Date, the Required Reserve Amount may be
initially funded from the proceeds of the initial Borrowing. For purposes of
this Section 7.18, the amount of interest scheduled to be paid with respect to
Tranche A Loans during any quarter shall be calculated assuming (i) that the
interest rate applicable to the Tranche A Loans shall be the highest interest
rate (including the relevant Applicable Margin) then payable with respect to
Tranche A Loans (or if no Tranche A Loans are then outstanding assuming that
the interest rate applicable shall be the Base Rate plus the relevant
Applicable Margin as of the determination date), and (ii) that the Tranche A
Revolving Commitment shall be fully drawn during the relevant calendar
quarter. All amounts from time to time deposited into the Reserve Account
shall be invested, held and distributed in accordance with the Security
Agreement entered into by and among Comercial, the Collateral Agent and the
Administrative Agent.
7.19 Reduction of Ratio of Consolidated Indebtedness to Combined
Operating Cash Flow.
(a) If as of the last day of any fiscal quarter of Comercial, the
ratio of Consolidated Indebtedness as of such day to Combined Operating Cash
Flow for the twelve-month period ending on such day, in each case of Comercial
and Vitrocrisa (determined on a combined basis) (the "Triggering Ratio")
exceeds 2.75 to 1.00, then within five (5) Business Days following such date
any Person shall obtain and deliver to the Administrative Agent, for the
benefit of the Lenders and as collateral for all Loans, an Acceptable Letter
of Credit in a minimum face amount equal to at least an amount necessary to
cause the Triggering Ratio to be equal to or less than 2.75 to 1.00, if the
proceeds of such Acceptable Letter of Credit were applied to the prepayment of
such Loans, taking into consideration all undrawn amounts under other
outstanding Acceptable Letters of Credit held by the Administrative Agent or
an Acceptable Bank for the benefit of all the Lenders pursuant to this Section
7.19 and all amounts then held by the Administrative Agent or an Acceptable
Bank in a Cash Collateral Account pursuant to Section 7.19(b).
(b) If the Administrative Agent has not received an Acceptable
Letter of Credit that renews or replaces an Acceptable Letter of Credit
delivered pursuant to this Section 7.19 on or before fifteen (15) days prior
to its stated expiry date, then the Administrative Agent shall be entitled to
draw, and at the request of the Required Tranche A Lenders and the Required
Tranche B Lenders shall draw, the entire amount of such Acceptable Letter of
Credit and the proceeds thereof shall be deposited in an account in the name
and under the control of the
46
Administrative Agent (the "Cash Collateral Account") at the Administrative
Agent or an Acceptable Bank and held by the Administrative Agent or such
Acceptable Bank as collateral for the Obligations of Comercial and Vitrocrisa
and applied to repay such Obligations when due.
(c) If Comercial or Vitrocrisa delivers to the Administrative Agent
a certificate pursuant to Section 7.1(f) certifying and evidencing that the
Triggering Ratio is equal to or less than 2.75 to 1.00, then as long as no
Default or Event of Default shall have occurred and be continuing, Comercial
or Vitrocrisa shall have the right to request the Administrative Agent to
terminate any Acceptable Letter of Credit previously delivered to the
Administrative Agent pursuant to this Section 7.19 and to return any cash
collateral then held by the Administrative Agent or an Acceptable Bank in a
Cash Collateral Account pursuant to Section 7.19(b).
7.20 Excess Cash Flow Prepayments.
(a) Within five (5) Business Days after each delivery of a
certificate from Comercial pursuant to Section 7.1(f), Comercial shall prepay
the outstanding Loans in an amount equal to fifty percent (50%) of the sum of
the Excess Cash Flow Amount as of the last day of the fiscal quarter to which
such certificate applies and the Excess Cash Flow Amount as of the last day of
the fiscal quarter immediately preceding such fiscal quarter, in each case
calculated in constant Pesos as of the last day of the fiscal quarter of
Comercial to which such certificate applies, each such prepayment, an "Excess
Cash Flow Prepayment". Each Excess Cash Flow Prepayment shall be applied to
the repayment of Loans pursuant to Sections 4.1(d) and (e). Prior to any such
prepayment, the calculation of any Excess Cash Flow Prepayment shall be
converted from Pesos into Dollars pursuant to a conversion rate in effect at
the time such calculation is performed, and each Excess Cash Flow Prepayment
shall be paid in Dollars.
(b) For the purposes of this Agreement, the term "Excess Cash Flow
Amount" shall mean, as of the last day of any fiscal quarter of Comercial,
Combined Operating Cash Flow for the twelve-month period ending on the last
day of such fiscal quarter plus or minus working capital (as defined under
GAAP), plus or minus gross interest expense (as defined under GAAP), plus or
minus taxes, plus or minus Consolidated Capital Expenditures, plus or minus
any permitted dividends paid by Comercial or Vitrocrisa during such period,
plus or minus mandatory prepayments or repayments paid during such period with
respect to the Obligations (including any Excess Cash Flow Prepayments
previously paid) and any other permitted Indebtedness incurred pursuant to
Section 8.3 including any such permitted Indebtedness owing to Affiliates,
plus or minus Other Transactions to the extent not otherwise included in any
of the foregoing, plus or minus statutory profit sharing for employees under
Mexican law (PTU) for such period to the extent not otherwise included in
taxes, plus any cash balances, minus the equivalent in Pesos of
U.S.$2,000,000, based on a conversion rate in effect at the time such Excess
Cash Flow Amount is calculated, minus restricted cash held in the Debt Reserve
Account (as defined in the Security Agreement) and, minus restricted cash held
in the Vitrocrisa Comercial Collection Account to the extent required to pay
debt service for the next quarter; provided, that the foregoing shall be
calculated on a combined basis for Comercial and Vitrocrisa.
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Section 8. Negative Covenants.
Each of Comercial and Vitrocrisa covenants and agrees that on and
after the Closing Date and until the Loans, together with all accrued
interest, Fees, costs, expenses and all other amounts with respect thereto,
are paid in full:
8.1 Liens. Each of Comercial and Vitrocrisa will not, and will not
permit their Consolidated Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon or with respect to any of its property or assets (real,
personal or mixed, tangible or intangible), whether now owned or hereafter
acquired; provided, that the provisions of this Section 8.1 shall not prevent
the creation, incurrence, assumption or existence of (Liens described below
are collectively referred to as "Permitted Liens"):
(a) Liens for taxes, assessments or governmental charges or levies
not yet due, or Liens for taxes, assessments or governmental charges or levies
being contested in good faith and by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP.
(b) Liens in respect of property or assets of such Person imposed by
Law, which were incurred in the ordinary course of business and do not secure
Indebtedness for borrowed money, such as carriers', warehousemen's,
materialmen's and mechanics' liens and other similar Liens arising in the
ordinary course of business, and which do not in the aggregate materially
detract from the value of such Person's respective property or assets or
materially impair the use thereof in the operation of the business of such
Person;
(c) Liens in existence on the Closing Date described in Schedule IV
and which secure Indebtedness described on Schedule IV hereto, plus renewals
and extensions of such Indebtedness; provided, that (x) the aggregate
principal amount of the Indebtedness, if any, secured by such Liens is not
increased above the amount secured on the date hereof at the time of any such
renewal, extension or replacement and (y) any such renewals, replacements or
extensions do not encumber any additional assets or properties of such Person
including without limitation any collateral covered or purported to be covered
by the Collateral Documents;
(d) easements, rights-of-way, restrictions, encroachments and other
similar charges or encumbrances, and minor title deficiencies, survey
exceptions, statutory and common law landlords' liens under leases to which
such Person is party, in each case not securing Indebtedness and not
materially interfering with the conduct of the business of such Person;
(e) Liens created under the Collateral Documents to secure the
Secured Obligations including any extensions or renewals thereof; provided,
that such extensions or renewals are effectuated and evidenced by the terms of
the Transaction Documents in compliance with the terms herein; and
(f) Liens securing Indebtedness in an aggregate principal amount not
exceeding U.S.$5,000,000; provided, that such Liens permitted pursuant to this
clause (f) shall not encumber property or assets purported to be covered by
any of the Collateral Documents, or cash or Cash Equivalents; provided,
however, that any such Lien may encumber property or assets purported to be
covered by the Non-Possessory Pledge Agreement only if (i) such Lien
48
does not include (and expressly excludes) inventory exported outside of Mexico
and any proceeds thereof or any rights to payment with respect to inventory
that is exported outside of Mexico or any accounts held outside of Mexico or
any letter of credit posted for the benefit of the Lenders, and (ii) any
Person to whom such Lien has been granted has entered into an intercreditor
agreement with the Administrative Agent and the Collateral Agent for the
benefit of the Lenders in form and substance satisfactory to the
Administrative Agent and the Collateral Agent;
(g) Liens on any property or assets of Comercial or Vitrocrisa or
any of their Subsidiaries securing Indebtedness incurred or assumed for the
purpose of financing (i) all or any part of the acquisition of raw materials,
utilities and other property or assets (including working capital loans
("creditos de habilitacion" or "avio")) or (ii) all or part of the
acquisition, construction or improvement of fixed assets and other property or
assets (including capital expenditure loans ("creditos refaccionarios"));
provided, that such Liens attach only to the property or assets so acquired,
constructed or improved concurrently with or within ninety (90) days after the
acquisition, construction or improvement thereof and secures only such
Indebtedness; and further provided, that such Liens shall not secure
Indebtedness in an aggregate principal amount exceeding $5,000,000;
(h) any Lien on any property or assets existing at the time of
acquisition thereof and which is not created as a result of or in connection
with or in anticipation of such acquisition;
(i) any Lien existing on any property or assets of an entity which
is merged with or into Comercial or Vitrocrisa which is not created as a
result of or in connection with or in anticipation of such merger; and
(j) Liens, if any, deemed created by the discount of domestic
accounts receivable contemplated by Section 8.6(b)(ii);
provided, that notwithstanding the foregoing, all Permitted Liens in clauses
(f), (g), (h) and (i) above, together, shall not secure Indebtedness not
otherwise permitted to be incurred pursuant to Section 8.3; and further
provided, that neither Comercial nor Vitrocrisa nor any of their Consolidated
Subsidiaries shall create, incur, assume or suffer to exist any Lien of the
type described in clauses (g), (h) and (i) after the occurrence and during the
continuation of a Default.
8.2 Dividends. Neither Comercial nor Vitrocrisa shall (i) declare or
pay any dividend or make any distribution on its capital in an amount such
that the amount of such dividend or distribution shall exceed the difference
between (A) the aggregate amount of its Consolidated Net Income from and after
January 1, 2003, and (B) the aggregate amount of dividends and distributions
theretofore declared and paid by it from and after January 1, 2003, (ii)
purchase, redeem or otherwise acquire any equity interests of its own capital
or equivalents, if any Event of Default shall have occurred and be continuing
or if, after giving effect to such action, an Event of Default shall occur and
be continuing, or (iii) declare or pay any dividend or make any other
distribution in respect of its capital, unless after giving effect to such
declaration or payment, the ratio of Consolidated Indebtedness to Combined
Operating Cash Flow (determined on a combined basis for Comercial and
Vitrocrisa), as of the last day of Vitrocrisa's
49
and Comercial's fiscal quarter immediately preceding the date of such payment,
shall not exceed 3.0 to 1.0.
8.3 Indebtedness. Each of Comercial and Vitrocrisa will not, and
will not permit any of their Consolidated Subsidiaries to, contract, create,
incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and the other
Transaction Documents;
(b) unsecured Indebtedness so long as, after giving effect to any
such incurrence, (i) the ratio of Consolidated Indebtedness, as of the date of
such incurrence, to Combined Operating Cash Flow, for the twelve-month period
immediately preceding the last day of Vitrocrisa's and Comercial's fiscal
quarter immediately preceding the date of such incurrence (in each case
determined on a combined basis for Comercial and Vitrocrisa) does not exceed
3.0:1.0, if such incurrence is made on or prior to June 30, 2005 and 2.75:1.0
at any time thereafter, and (ii) there shall exist no Default or Event of
Default, and (iii) the aggregate outstanding principal amount of Consolidated
Indebtedness of Comercial and Vitrocrisa (determined on a combined basis)
including all Indebtedness outstanding hereunder and under the other
Transactional Documents does not exceed $85,000,000; provided, that an
aggregate principal amount not to exceed U.S.$5,000,000 in aggregate of such
Indebtedness may be secured pursuant to Section 8.1(f) and an aggregate
principal amount not to exceed U.S.$5,000,000 in the aggregate of such
Indebtedness may be secured pursuant to Section 8.1(g);
(c) Indebtedness incurred to refinance existing Indebtedness so long
as, as of the date of any such incurrence, after giving pro forma effect to
such Indebtedness, there shall exist no Default or Event of Default; provided,
that the principal amount of the new Indebtedness is no greater than the
principal amount of the refinanced Indebtedness;
(d) Indebtedness in respect of Derivative Obligations entered into
in the ordinary course of business of Comercial, Vitrocrisa or any of their
Consolidated Subsidiaries with reputable financial institutions or vendors and
not for purposes of speculation; and
(e) Indebtedness, if any, deemed incurred by the discount of
domestic accounts receivable contemplated by Section 8.6(b)(ii).
8.4 Investments. Each of Comercial and Vitrocrisa will not, and will
not permit any of their Consolidated Subsidiaries to, directly or indirectly,
lend money or credit or make advances to any Person, or provide a guaranty or
keep well or similar arrangement in respect of Indebtedness of any Person, or
make any capital contribution to any other Person, or purchase or otherwise
acquire (in one or a series of related transactions) any equity interests or
any part of the property or assets (other than purchases or other acquisitions
of land, buildings, machinery, inventory, materials and equipment reasonably
required to conduct its business) of any other Person (collectively,
"Investments"), except that the following shall be permitted:
(a) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may acquire and hold accounts receivables owing to it, if created
or acquired in the ordinary course of business and payable or dischargeable in
accordance with customary terms;
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(b) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may acquire and hold cash and Cash Equivalents; and
(c) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may make Investments in their Affiliates consisting of loans or
advances to such Affiliates, provided that (i) with respect to such
Investments with a term of 180 days or less ("Short Term Investments"), the
aggregate amount of all such Investments and all Investments of more than 180
days shall not exceed 55% of the Consolidated Net Worth of Vitrocrisa and
Comercial (determined on a combined basis), and (ii) with respect to such
Investments with a term of more than 180 days, (A) the aggregate amount of all
such Investments shall not exceed 25% of the Consolidated Net Worth of
Vitrocrisa and Comercial (determined on a combined basis) and (B) such
Investments permitted pursuant to this clause (c)(ii) shall, for all purposes
of this Agreement (including Section 8.2) be deemed a dividend or other
distribution paid by Vitrocrisa or Comercial; provided, however, that solely
for purposes of this clause (c)(ii), but not for purposes of Section 8.2, the
Investment in the amount of US$14,000,000 outstanding as of the date hereof to
Vitrocrisa Holding shall be deemed to be a Short Term Investment to the extent
it exceeds the amount permitted to be outstanding under this clause (c)(ii)
prior to giving effect to any other Investments. It is understood and agreed
that any Investment that is not repaid or required to be repaid within at
least 180 days after it is made or that is advanced less than three (3) days
after it is paid is not a Short Term Investment; and for the avoidance of
doubt, revolving advances are not Short Term Investments.
8.5 Consolidations, Mergers. Each of Comercial and Vitrocrisa will
not, and will not permit any of their Consolidated Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of
consolidation or merger with or into any other Person, except that:
(a) Comercial and Vitrocrisa may allow a Consolidated Subsidiary to
wind up, liquidate or dissolve its affairs; provided, that all of the property
and assets of such Consolidated Subsidiary are transferred to Vitrocrisa or
Comercial or to another Consolidated Subsidiary of Vitrocrisa or Comercial and
the Indebtedness of the liquidated Consolidated Subsidiary is fully
discharged; and
(b) Comercial and Vitrocrisa may consolidate with, or merge with or
into, any other Person; provided, that (i) Vitrocrisa or Comercial, as the
case may be, shall be the continuing or surviving corporation, (ii) such
consolidation or merger is effected by means of an arms' length transaction,
(iii) such Person is engaged in a similar business as Vitrocrisa or Comercial,
as the case may be, and any business incidental thereto, (iv) both prior to
and after giving effect thereto there shall be no Default or Event of Default,
(v) such consolidation or merger shall not result in a Material Adverse Effect
on Vitrocrisa or Comercial and (vi) no such consolidation or merger shall be
contested by such Person's management or board of directors, whether through
court proceedings or otherwise; and further provided, that, Comercial and
Vitrocrisa may consolidate with or merge with or into each other, or with or
into Vitrocrisa Holding; and further provided, that (A) if neither Comercial
nor Vitrocrisa is the surviving entity, such surviving entity shall expressly
assume the obligations of Comercial and Vitrocrisa, as applicable, under the
Transaction Documents concurrently with the effectuation of such consolidation
or merger pursuant to documentation in form and substance satisfactory to the
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Xxxxxxxxxxxxxx Xxxxx, (X) both prior to and after giving effect thereto there
shall be no Default or Event of Default, (C) the Administrative Agent shall
have received favorable legal opinions from Mexican and New York counsel of
Comercial and all other relevant entities acceptable to the Administrative
Agent as to the existence, organization, good standing, non-contravention with
laws or other agreements of Comercial and such relevant entities, and to the
due authorization, assumption, execution, delivery and enforceability of the
Transaction Documents and the perfection of the liens created thereby.
8.6 Sales of Assets. Each of Comercial and Vitrocrisa will not, and
will not permit any of their Consolidated Subsidiaries to, sell, lease,
assign, transfer or otherwise dispose of, directly or indirectly (or agree to
do any of the foregoing at any future time), all or any part of its property
or assets, except that:
(a) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may, in the ordinary course of business, sell, lease or otherwise
dispose of any assets which, in its reasonable judgment, are no longer useful
in the conduct of its business; provided, that the aggregate proceeds of any
such sales, leases or dispositions, if any, and net of fees and expenses
related thereto, are either (i) reinvested in the business of such Person or
(ii) applied to repay Indebtedness of such Person, in each case by a date no
later than 180 days from the closing date of such sale, lease or disposition;
and further provided, that such sales, leases or dispositions are for fair
value and that the aggregate proceeds of all such sales, leases or
dispositions in any calendar year shall not exceed ten percent (10%) of the
book value of all assets and properties of Comercial and Vitrocrisa determined
by reference to the most recent financial statements delivered to the
Administrative Agent pursuant to this Agreement;
(b) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may (i) make sales of inventory in the ordinary course of
business, the proceeds of which sales are applied to such business and (ii)
discount domestic accounts receivables in the ordinary course of business on a
non-recourse basis without representations or warranties as to such
receivables pursuant to payment arrangements entered into with purchasers of
product; and (c) Each of Comercial, Vitrocrisa and their Consolidated
Subsidiaries may sell, lease or otherwise dispose of assets or property;
provided, that (i) the aggregate proceeds of any such sales, leases or
dispositions, if any, and net of fees and expenses related thereto, are either
(x) reinvested in the business of such Person or (y) applied to repay
Indebtedness of such Person, in each case by a date no later than 180 days
from the closing date of such sale, lease or disposition, and (ii) that the
aggregate proceeds of all assets subject to such sales, leases or dispositions
in any calendar year shall not exceed 10% of the Consolidated Net Worth of
Vitrocrisa and Comercial (determined on a combined basis) (as determined by
reference to the most recent quarterly consolidated and combined balance sheet
of Vitrocrisa, Comercial and their Consolidated Subsidiaries).
8.7 Consolidated Interest Coverage Ratio. Vitrocrisa and Comercial
will not, as of the last day of any fiscal quarter of each of Vitrocrisa and
Comercial ending after the date hereof, permit the ratio of Combined Operating
Cash Flow to Consolidated Gross Interest Expense (in each case, determined on
a combined basis for Vitrocrisa and Comercial) to be less than 2.5:1.0.
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8.8 Consolidated Leverage Ratio. Vitrocrisa and Comercial will not,
as of the last day of any fiscal quarter of each of Vitrocrisa and Comercial
ending after the date hereof, permit the ratio of Consolidated Indebtedness to
Combined Operating Cash Flow (in each case, determined on a combined basis for
Vitrocrisa and Comercial) to exceed (i) 3.25 to 1.0 at any time during the
period from and including the Closing Date through and including June 30,
2005, and (ii) 3.0 to 1.0, at any time thereafter.
8.9 Net Worth. Vitrocrisa and Comercial will not, as of the last day
of any fiscal quarter of each of Vitrocrisa and Comercial ending after the
date hereof, permit the Consolidated Net Worth of Vitrocrisa and Comercial
(determined on a combined basis) to be less than 320,000,000 constant Pesos as
of December 31, 2003.
8.10 Limitations on Modifications of Certain Agreements; etc. Each
of Comercial and Vitrocrisa will not, and will not permit any of their
Consolidated Subsidiaries to, (i) make (or give any notice in respect of) any
voluntary or optional payment or prepayment on or redemption or acquisition
for value of (including, without limitation, by way of depositing with the
trustee with respect thereto money or securities before due for the purpose of
paying when due) any unsecured Indebtedness which is subordinated in right of
payment to the Loans and/or the other Obligations, (ii) amend or modify, or
permit the amendment or modification of, any provision of any Indebtedness or
of any agreement (including, without limitation, any royalty or technical
assistance agreement, purchase agreement, indenture, loan agreement or
security agreement) if such amendment or modification could reasonably result
in a Material Adverse Effect on Comercial or Vitrocrisa, or (iii) amend,
modify or change its current bylaws (estatutos sociales) or other
organizational documents if such amendment, modification or change could
reasonably result in a Material Adverse Effect on Comercial or Vitrocrisa, or
(iv) amend or modify any provision of the Intercompany Note or the Accelerated
Product Payment Agreement.
8.11 No Other Business. Each of Comercial and Vitrocrisa will not,
and will not permit any of their Subsidiaries to, carry on any business other
than the business similar to the one conducted by it as of the Closing Date,
and will not take any action whether by acquisition or otherwise which would
constitute or result in any material alteration to the nature of that
business.
8.12 Transactions with Affiliates. Except as set forth in Schedule
V, each of Comercial and Vitrocrisa will not, and will not permit any of their
Consolidated Subsidiaries to, enter into any transaction or series of related
transactions with any of its shareholders or Affiliates other than in the
ordinary course of business and on terms and conditions substantially as
favorable to Comercial, Vitrocrisa or such Consolidated Subsidiary as would
reasonably be obtained at that time in a comparable arm's-length transaction
with a Person other than a shareholder or Affiliate.
8.13 Limitation on Restrictions on Subsidiary Dividends and Other
Distributions. Each of Comercial and Vitrocrisa will not, directly or
indirectly, create or otherwise cause or suffer to exist or become effective
any encumbrance or restriction on the ability of any of their Subsidiaries to
(i) pay dividends or make any other distributions on its equity interests or
any other interest or participation in its profits owned by Vitrocrisa,
Comercial
53
or any of their Subsidiaries, or pay any Indebtedness owed to Vitrocrisa,
Comercial or any of their Subsidiaries, (ii) make loans or advances to
Vitrocrisa or Comercial or (iii) transfer any of its properties or assets to
Vitrocrisa or Comercial, except for such encumbrances or restrictions existing
under or by reasons of (A) applicable Law, (B) this Agreement, and (C)
agreements or obligations of Vitrocrisa or its Subsidiaries which are in
existence on the Closing Date.
8.14 Inconsistent Agreements. Each of Comercial and Vitrocrisa will
not, and will not permit any of their Consolidated Subsidiaries to, enter into
any agreement (other than this Agreement and the other Transaction Documents
and other Permitted Liens) permitting the creation or assumption of any Lien
upon its properties, revenues or assets, whether now owned or hereafter
acquired, or the ability of it to modify this Agreement or any other
Transaction Document.
8.15 Change in Accounting Policies. Each of Comercial and Vitrocrisa
will not, and will not permit any of their Consolidated Subsidiaries to,
change its accounting policies or reporting practices (including changing its
fiscal year), except as required by GAAP or United States generally accepted
accounting principles, if such change could reasonably be expected to result
in a Material Adverse Effect with respect to Comercial or Vitrocrisa.
8.16 Subsidiaries. Each of Comercial and Vitrocrisa will not, and
will not permit any of their Subsidiaries to, form any Subsidiary unless such
newly-formed Subsidiary, simultaneously therewith, guarantees the Obligations
hereunder pursuant to the Subsidiary Guaranty and otherwise complies with
Section 7.13.
8.17 Sale-leaseback Transactions. Each of Comercial and Vitrocrisa
will not, and will not permit any of their Subsidiaries to, enter into any
sale-leaseback transaction with respect to any of their respective assets;
provided, that up to U.S.$5,000,000 in the aggregate (determined by reference
to the lower of the gross proceeds of the related sale and the fair market
value of the sold asset) may be sold and leased back.
8.18 Operating Leases. Comercial and Vitrocrisa will not permit the
aggregate amount of all lease and rental payments in respect of operating
leases for real or personal property under which Vitrocrisa, Comercial or any
of their Subsidiaries has any payment, guarantee or other obligation made by
Vitrocrisa, Comercial or their Subsidiaries to exceed U.S.$5,000,000 in the
last twelve (12) months.
8.19 Minimum Operating Cash Flow. Comercial and Vitrocrisa shall not
permit their Combined Operating Cash Flow to be less than U.S.$24,000,000 as
of the end of any consecutive four fiscal quarter period ending after the
Closing Date.
8.20 Minimum Debt Service Coverage Ratio. (a) Comercial and
Vitrocrisa shall not permit (i) the amount of total collections of account
receivables or other amounts payable to Comercial and deposited in the
Vitrocrisa Comercial Collection Account during any calendar quarter ending on
or after the Closing Date to be less than an amount equal to (W) two (2)
multiplied by (X) the sum of the amount of interest and principal due on
account of Tranche A Term Loans plus the amount of interest due on account of
the Tranche A Revolving Loans, in each case, during the immediately following
calendar quarter calculated assuming that
54
the Tranche A Revolving Commitments are fully drawn and that all Tranche A
Loans will bear interest at the highest rate then in effect for any
outstanding Tranche A Loans, (or if no Tranche A Loans are then outstanding at
a per annum rate equal to the Base Rate plus the Tranche A Applicable Margin
calculated as of such determination date), or (ii) the amount of total
collections of Libbey Receivables deposited in the Libbey Collection Accounts,
for any twelve-month period ending on the last day of any calendar quarter
ending after the Closing Date, divided by four (4) (provided, that for any
such twelve-month period that includes one or more calendar quarters ending
prior to the Closing Date, the amount of collections for such quarter or
quarters shall be those certified by Comercial as the collections of the
Libbey Receivables for such period), to be less than the product of (Y) one
and one half (1.5) multiplied by (Z) the sum of amount of interest and
principal due on account of Tranche A Term Loans plus the amount of interest
due on account of the Tranche A Revolving Loans, in each case, during the
immediately following calendar quarter calculated assuming that the Tranche A
Revolving Commitments are fully drawn and that all Tranche A Loans will bear
interest at the highest rate then in effect for any outstanding Tranche A
Loans (or if no Tranche A Loans are then outstanding, at the Base Rate plus
the Tranche A Applicable Margin calculated as of such determination date);
provided, however, that failure to comply with this Section 8.20 shall
constitute a Default but shall not constitute an Event of Default unless
Comercial and Vitrocrisa shall fail to comply with the provisions of this
Section 8.20(a) for two (2) consecutive quarters.
(b) Comercial and Vitrocrisa shall not permit (i) the amount of
total collections of account receivables or other amounts payable to Comercial
arising from or relating to exports made directly or indirectly by Comercial
and deposited in the Vitrocrisa Comercial Collection Account during any
calendar quarter ending on or after the Closing Date to be less than an amount
equal to (W) one and one quarter (1.25) multiplied by (X) the sum of the
amount of interest and principal due on account of Tranche A Term Loans plus
the amount of interest due on account of the Tranche A Revolving Loans, or
(ii) the amount of total collections of Libbey Receivables deposited in the
Libbey Collection Accounts, for any twelve-month period ending on the last day
of any calendar quarter ending after the Closing Date, divided by four (4)
(provided, that for any such twelve-month period that includes one or more
calendar quarters ending prior to the Closing Date, the amount of collections
for such quarter or quarters shall be those certified by Comercial as the
collections of the Libbey Receivables for such period), to be less than the
product of (Y) one and one quarter (1.25) multiplied by (Z) the sum of the
amount of interest and principal due on account of Tranche A Term Loans plus
the amount of interest due on account of the Tranche A Revolving Loans, in
each case described in clauses (i) and (ii), during the immediately following
calendar quarter calculated assuming that the Tranche A Revolving Commitments
are fully drawn and that all Tranche A Loans will bear interest at the highest
rate then in effect for any outstanding Tranche A Loans, (or if no Tranche A
Loans are then outstanding at a per annum rate equal to the sum of the Base
Rate plus the Tranche A Applicable Margin calculated as of such determination
date).
8.21 Fixed Charge Coverage Ratio. Vitrocrisa and Comercial will not,
as of the last day of any fiscal quarter of each of Vitrocrisa and Comercial
ending after the date hereof, permit the ratio of their Combined Operating
Cash Flow (determined on a combined basis for Vitrocrisa and Comercial) to the
sum of (i) their Consolidated Gross Interest Expense as of such date plus (ii)
their Consolidated Capital Expenditures as of such date (in each case,
determined on a combined basis for Vitrocrisa and Comercial) to be less than
1.25:1.0.
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Section 9. Events of Default.
Upon the occurrence of any of the following specified events (each
an "Event of Default"):
9.1 Payments. Comercial shall fail to pay (i) any principal when
due, or (ii) after three Business Days following the due date in respect
thereof, interest or Fees or other amounts in respect of the Loans and the
Notes as provided herein and therein; or
9.2 Representations, etc. Any representation, warranty or statement
made by or on behalf of Vitrocrisa or Comercial in this Agreement or any
Transaction Document or in any certificate delivered pursuant hereto or
thereto shall prove to be untrue in any material respect on the date as of
which made or deemed made; or
9.3 Covenants. (i) Vitrocrisa or Comercial shall default in the due
performance or observance by it of any term, covenant or agreement contained
in Section 7.1(g) or Section 8 or (ii) Comercial, Vitrocrisa or any of their
Subsidiaries shall default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in Sections 9.1 and
9.2 and clause (i) of this Section 9.3) contained in this Agreement or any
other Transaction Document and any such default shall have continued
unremedied for a period of twenty (20) days after the earlier of (a) written
notice thereof shall have been provided to Comercial or Vitrocrisa by any of
the Lenders or the Administrative Agent or (b) any responsible officer of
Comercial or Vitrocrisa or any Subsidiary knows, or reasonably should have
known, of such default; or
9.4 Payment Default Under Other Agreements. Comercial, Vitrocrisa or
any of their Subsidiaries shall default in any payment of any Indebtedness,
other than the Obligations, having a principal amount in excess of
U.S.$5,000,000 (or its equivalent in any other currency), either individually
or in the aggregate, as the same shall become due and payable beyond the
period of grace, if any, provided in the instrument or agreement under which
such Indebtedness was created; or
9.5 Acceleration of Indebtedness. Comercial, Vitrocrisa or any of
their Subsidiaries shall suffer any event or condition that occurs which
results in the acceleration of the maturity of any Indebtedness of Comercial,
Vitrocrisa and/or any of their Subsidiaries having a principal amount in
excess of U.S.$5,000,000 (or its equivalent in any other currency), either
individually or in the aggregate; or
9.6 Bankruptcy, etc. (a) There is entered against Comercial,
Vitrocrisa or any of the Subsidiaries of Comercial or Vitrocrisa a decree or
order by a court under the Bankruptcy Code or any other applicable law which
shall remain in effect for a period of 60 days after entry: (i) adjudging
Comercial, Vitrocrisa or such Subsidiary bankrupt, insolvent or in concurso
mercantil, (ii) approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of Comercial,
Vitrocrisa or such Subsidiary under any applicable law, (iii) appointing a
receiver, "visitador", "conciliador", "sindico", "interventor", liquidator,
assignee, trustee, sequestrator (or other similar official) of Comercial,
Vitrocrisa or such Subsidiary or of any substantial part of their respective
property or other assets, or (iv)
56
ordering the winding up or liquidation of its affairs; or (b) (i) Comercial,
Vitrocrisa or any of its Subsidiaries (A) institutes proceedings or takes any
form of corporate action to be liquidated or adjudicated bankrupt, insolvent,
in suspension of payments or in concurso mercantil, (B) consents to the
institution of bankruptcy (concurso mercantil) or insolvency proceedings
against it, (C) files a petition or consent seeking reorganization, suspension
of payments, concurso mercantil or relief under any applicable law or consents
to the filing of any such petition or to the appointment of a receiver,
"visitador", "conciliador", "sindico", "interventor", liquidator, assignee,
trustee, sequestrator (or other similar official) of Vitrocrisa, Comercial or
such Subsidiary or of any substantial part of their respective property, (D)
makes a general assignment for the benefit of creditors, or (E) admits in
writing its inability to pay its debts generally as they become due or
otherwise becomes insolvent, or (ii) any trust or corporate action is taken by
Comercial, Vitrocrisa or any of their Subsidiaries for the purpose of
effecting any of the foregoing; or
9.7 Judgments. One or more final judgments or decrees for the
payment of money shall be entered against Comercial, Vitrocrisa or any of
their Subsidiaries involving, in the aggregate, a liability (not paid or fully
covered by insurance other than reasonable and customary deductibles) of the
equivalent of U.S.$5,000,000 or more, and all such judgments or decrees shall
not have been vacated, discharged or stayed or bonded pending appeal within 60
days after the entry thereof; or
9.8 Cancellation of Payment Obligation. Any dominant authority
asserting or exercising de jure or de facto governmental or police powers in
Mexico shall, by moratorium laws or otherwise, cancel, suspend or defer the
Obligation of Comercial or Vitrocrisa to pay any amount required to be paid
hereunder or under the Notes, or the Obligations of Comercial, Vitrocrisa or
any of their Subsidiaries under any other Transaction Document; or
9.9 Government Action. Any Government Agency shall have (a)
condemned, nationalized, seized, or otherwise expropriated all or
substantially all of the property or other assets of Comercial, Vitrocrisa or
any of their Subsidiaries, (b) assumed custody or control of such property or
other assets of the business or operations of Comercial, Vitrocrisa or any
such Subsidiary, or (c) taken (i) any action for the dissolution or
disestablishment of Comercial, Vitrocrisa or any such Subsidiary or (ii) any
action that would prevent Comercial, Vitrocrisa or any such Subsidiary from
carrying on a substantial part of its business; or
9.10 Failure of Enforceability. Any Transaction Document shall cease
to be enforceable and in full force and effect, or Vitrocrisa or Comercial
shall deny or disaffirm any of its obligations under any Transaction Document;
or
9.11 Change in Control. A Change in Control shall occur; or
9.12 Imposition of Exchange Restrictions. Any restriction or
requirement not in effect on the Closing Date shall have been imposed, whether
by legislative enactment, decree, regulation, order or otherwise, which limits
Comercial's, Vitrocrisa's or any of their Subsidiaries' ability to transfer
foreign exchange for the purpose of performing any obligation under any
Transaction Document unless, within 30 days after the imposition of any such
restriction or requirement, Comercial or Vitrocrisa, as applicable, shall have
delivered to the
57
Administrative Agent evidence satisfactory to it that foreign exchange will be
made available to it for the purpose of performing its obligations under the
Transaction Documents; or
9.13 Guarantor Default Under Libbey Guaranty or Vitro Guaranty.
(a) (i) Any Guarantor Event of Default set forth in Sections 5.1,
5.2, 5.4, 5.5, 5.6, 5.7 or 5.9 of the Libbey Guaranty or in Sections 5.1, 5.2,
5.4, 5.5, 5.6, 5.7, 5.8, or 5.10 the Vitro Guaranty shall occur and be
continuing; provided, that such occurrence shall not constitute an Event of
Default hereunder if: (A) on or before (5) days after any such occurrence, the
Guarantor party to the Guaranty under which such Guarantor Event of Default
has occurred (the "Defaulting Guarantor") or any other Guarantor shall provide
written notice to the Administrative Agent of its intent to obtain and deliver
to the Administrative Agent, for the benefit of the Lenders that are entitled
to the benefit of the Guaranty provided by the Defaulting Guarantor, an
Acceptable Letter of Credit in a minimum face amount equal to at least such
Defaulting Guarantor's Guaranteed Obligations (as defined in the Guaranty to
which such Defaulting Guarantor is a party and used herein with the same
meaning) or to pay in full in cash the Defaulting Guarantor's Guaranteed
Obligations; and (B) on or before thirty (30) days after any such occurrence,
the Defaulting Guarantor or any other Guarantor shall obtain a commitment from
an Acceptable Bank to issue such an Acceptable Letter of Credit for the
benefit of the Administrative Agent; and (C) on or before forty-five (45) days
after any such occurrence, the Defaulting Guarantor or any other Guarantor
shall obtain and deliver to the Administrative Agent, for the benefit of such
Lenders, such an Acceptable Letter of Credit or shall pay in full in
immediately available funds the amount of such Guaranteed Obligations to the
Administrative Agent for the account of the relevant Lenders as provided
herein together with all Additional Costs and any amounts payable pursuant to
Section 2.9, if any, with respect to such payment; and
(ii) Any Guarantor Event of Default set forth in Section 5.3 of
either the Libbey Guaranty or the Vitro Guaranty shall occur and be
continuing; provided, that such occurrence shall not constitute an Event of
Default hereunder if: (A) within five (5) days after any such occurrence, the
Defaulting Guarantor or any other Guarantor shall provide written notice to
the Administrative Agent of its intent to obtain and deliver to the
Administrative Agent, for the benefit of the Lenders that are entitled to the
benefit of the Guaranty provided by the Defaulting Guarantor, an Acceptable
Letter of Credit in a minimum face amount equal to at least such Defaulting
Guarantor's Guaranteed Obligations (as defined in the Guaranty to which such
Defaulting Guarantor is a party and used herein with the same meaning) or to
pay in full in cash the Defaulting Guarantor's Guaranteed Obligations; and (B)
within thirty (30) days after any such occurrence, the Defaulting Guarantor or
any other Guarantor shall obtain and deliver to the Administrative Agent, for
the benefit of such Lenders, such an Acceptable Letter of Credit, or shall pay
in full in immediately available funds the amount of such Guaranteed
Obligations to the Administrative Agent for the account of the relevant
Lenders as provided herein together with all Additional Costs and any amounts
payable pursuant to Section 2.9, if any, with respect to such payment;
(b) For the purposes of this Agreement, the term "Acceptable Letter
of Credit" shall mean one or more irrevocable standby letters of credit
obtained by (or on behalf of) any Person and delivered to the Administrative
Agent for the benefit of certain Lenders as set
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forth in this Agreement, which letter of credit (i) shall be issued for the
benefit of the Administrative Agent by an Acceptable Bank, (ii) shall be in a
minimum face amount as set forth in this Agreement, (iii) shall have an expiry
date of at least ten (10) days beyond the maturity date of the Loan or Loans
which such Defaulting Guarantor has guaranteed, or alternatively, shall have
an expiry date of one (1) year, provided that such letter of credit shall be
drawable in full if it is not renewed or replaced by an Acceptable Letter of
Credit on or before fifteen (15) days prior to its stated expiry date, (iv)
shall be drawable upon presentment by the Administrative Agent of a
certificate stating that the Administrative Agent is entitled to make such
drawing under such letter of credit, (v) shall be drawable if (A) the issuer's
long-term unsecured debt ratings are downgraded such that the issuer ceases to
be an Acceptable Bank and (B) such Guarantor shall have failed to obtain a
replacement letter of credit from an Acceptable Bank within the earlier of (1)
fifteen (15) days after such downgrade or (2) a shorter period if the stated
expiry date of such letter of credit falls within the twenty-day period
commencing on the date of such downgrade, and (vi) otherwise shall be in form
and substance acceptable to the Administrative Agent; and for the purposes of
this Agreement, the term "Acceptable Bank" shall mean any Lender or a
commercial bank whose or whose parent company's unsecured long-term debt
obligations are rated "A" or "A2" or better by S&P or Xxxxx'x, respectively,
for the term of any Acceptable Letter of Credit that it issues;
(c) If the Administrative Agent has not received an Acceptable
Letter of Credit from a Guarantor that renews or replaces an Acceptable Letter
of Credit on or before fifteen (15) days prior to its stated expiry date, then
the Administrative Agent shall be entitled to draw, and at the request of the
Required Tranche A Lenders or the Required Tranche B Lenders, as the case may
be (which are certain of the Lenders that are entitled to the benefit of the
Guaranty provided by the Defaulting Guarantor), shall draw, the entire amount
of such Acceptable Letter of Credit and the proceeds thereof shall be
deposited in the Cash Collateral Account at the Administrative Agent or an
Acceptable Bank and held by the Administrative Agent as collateral for the
Defaulting Guarantor's Guaranteed Obligations (as defined in the Guaranty to
which such Defaulting Guarantor is a party) and applied in payment of such
Guaranteed Obligations when due;
9.14 Guarantor Default Under US Affiliate Guaranty or Subsidiary
Guaranty, etc. A Guarantor Event of Default under any US Affiliate Guaranty or
Subsidiary Guaranty shall occur or a Guarantor Event of Default under Section
5.8 of the Libbey Guaranty or Section 5.9 of the Vitro Guaranty shall occur;
then, and in any such event, and at any time thereafter:
(a) if an Event of Default specified in Section 9.6 shall occur in
respect of Comercial or Vitrocrisa: (i) the Commitments (if not theretofore
terminated) shall automatically terminate and the outstanding principal amount
of all outstanding Loans and all other obligations hereunder shall
automatically be and become immediately due and payable, without demand,
protest or presentment or notice of any kind, all of which are hereby
expressly waived by Comercial, Vitrocrisa and their respective Subsidiaries;
and (ii) without limiting the foregoing, the Agents and the Lenders shall be
entitled to exercise any and all other remedies available to them under the
Transaction Documents or other document or instrument entered into in
connection therewith;
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(b)(i) if an Event of Default specified in Section 9.13 shall
occur in respect of Vitro, then: (1) (A) the Administrative Agent may, and
with the approval of the Required Tranche A Lenders shall, terminate the
Tranche A Total Commitment (if not theretofore terminated) and accelerate the
outstanding principal amount of all outstanding Tranche A Loans and all other
Tranche A Obligations, which upon acceleration shall be and become immediately
due and payable, without demand, protest or presentment or notice of any kind,
all of which are hereby expressly waived by Comercial, Vitrocrisa and their
respective Subsidiaries, and (B) the Agents and the Tranche A Lenders shall be
entitled to exercise any and all other remedies available to them under the
Transaction Documents or other documents or instruments entered into in
connection therewith, including without limitation, any remedies in Section
9(c) below; and (2) (A) the Administrative Agent may, and with the approval of
the Required Tranche B Lenders shall, terminate the Tranche B Commitment (if
not theretofore terminated) and accelerate the outstanding principal amount of
all outstanding Tranche B Loans and all other Tranche B Obligations, which
upon acceleration shall automatically be and become immediately due and
payable, without demand, protest or presentment or notice of any kind, all of
which are hereby expressly waived by Comercial, Vitrocrisa and their
respective Subsidiaries, and (B) the Administrative Agent and the Tranche B
Lenders shall be entitled to exercise any and all other remedies available to
them under the Transaction Documents or other documents or instruments entered
into in connection therewith, including without limitation, any remedies in
Section 9(c) below; and
(ii) if an Event of Default specified in Section 9.13 shall occur in
respect of Libbey or Libbey Glass, then: (1) (A) the Administrative Agent
may, and with the approval of the Required Tranche B Lenders shall,
terminate the Tranche B Commitment (if not theretofore terminated) and
accelerate the outstanding principal amount of all outstanding Tranche B
Loans and all other Tranche B Obligations, which upon acceleration shall
be and become immediately due and payable, without demand, protest or
presentment or notice of any kind, all of which are hereby expressly
waived by Comercial, Vitrocrisa and their respective Subsidiaries, and
(B) the Administrative Agent and the Tranche B Lenders shall be entitled
to exercise any and all other remedies available to them under the
Transaction Documents or other documents or instruments entered into in
connection therewith, including without limitation, any remedies in
Section 9(c) below; and (2) (A) the Administrative Agent may, and with
the approval of the Required Tranche A Lenders shall, terminate the
Tranche A Total Commitment (if not theretofore terminated) and accelerate
the outstanding principal amount of all outstanding Tranche A Loans and
all other Tranche A Obligations, which upon acceleration shall
automatically be and become immediately due and payable, without demand,
protest or presentment or notice of any kind, all of which are hereby
expressly waived by Comercial, Vitrocrisa and their respective
Subsidiaries, and (B) the Agents and the Tranche A Lenders shall be
entitled to exercise any and all other remedies available to them under
the Transaction Documents or other documents or instruments entered into
in connection therewith, including without limitation, any remedies in
Section 9(c) below;
(c) if any other Event of Default shall then be continuing:
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(i) the Administrative Agent may, and shall with the approval of
the Required Tranche A Lenders, by written notice to Comercial, take any of
the following actions without the consent of, but with prior written notice
to, the Tranche B Lenders (it being understood that none of such actions shall
in any way limit or otherwise affect the rights available to the Tranche B
Lenders, any Agent or the holder of any Tranche B Note under this Agreement or
any other Transaction Document): (A) declare the Tranche A Total Commitment
terminated whereupon the Tranche A Term Commitment and the Tranche A Revolving
Commitment of each Tranche A Lender, as the case may be, shall forthwith
terminate immediately; (B) declare the principal of and any accrued interest
in respect of all Tranche A Loans and the Tranche A Notes and all Obligations
owing in respect of the Tranche A Loans or Tranche A Total Commitment to be,
whereupon the same shall become, forthwith due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by Comercial and Vitrocrisa, and exercise any rights available
under any Guaranty guaranteeing any of the Tranche A Loans or any other
document or instrument entered into in connection therewith; (C) enforce,
realize upon or exercise, or instruct the Collateral Agent to enforce, realize
upon or exercise, its remedies against any security or collateral provided
under or in connection with any of the Collateral Documents; and/or (D)
exercise any other rights available under the Transaction Documents or other
document or instrument entered into in connection therewith in respect of the
Tranche A Loans or Tranche A Total Commitment; and
(ii) the Administrative Agent may, and shall with the approval of
the Required Tranche B Lenders, by written notice to Comercial, take any of
the following actions without the consent of, but with prior written notice
to, the Tranche A Lenders (it being understood that none of such actions shall
in any way limit or otherwise affect the rights available to the Tranche A
Lenders, any Agent or the holder of any Tranche A Note under this Agreement or
any other Transaction Document): (A) declare the Tranche B Total Commitment
terminated whereupon the Tranche B Commitment of each Tranche B Lender shall
forthwith terminate immediately; (B) declare the principal of and any accrued
interest in respect of all Tranche B Loans and the Tranche B Notes and all
Obligations owing in respect of the Tranche B Loans or Tranche B Total
Commitment to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by Comercial and Vitrocrisa, and exercise any rights
available under any Guaranty guaranteeing any of the Tranche B Loans or any
other document or instrument entered into in connection therewith; and/or (C)
exercise any other rights available under the Transaction Documents or other
document or instrument entered into in connection therewith in respect of the
Tranche B Loans or Tranche B Total Commitment; and
(iii) without limiting the foregoing, the Agents and the Lenders
shall be entitled to exercise any and all other remedies available to them
under the Transaction Documents or other document or instrument entered into
in connection therewith.
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Section 10. Guaranty.
10.1 Guaranty. For valuable consideration, the receipt of which is
hereby acknowledged, and to induce the Lenders to enter into this Agreement,
Vitrocrisa hereby absolutely and unconditionally guarantees prompt payment
when due, whether at stated maturity, upon acceleration or otherwise, and at
all times thereafter, of any and all Obligations of Comercial to the
Administrative Agent, the Collateral Agent, the Lenders and any holder of a
Note, or any of them, under or with respect to the Transaction Documents,
whether for principal, interest, fees, expenses or otherwise, in each case
howsoever created, arising or evidenced, whether direct or indirect, absolute
or contingent, now or hereafter existing, or due or to become due
(collectively, the "Guaranteed Obligations").
10.2 Waivers. Vitrocrisa waives notice of the acceptance of this
guaranty and of the extension or continuation of the Guaranteed Obligations or
any part thereof. Vitrocrisa further waives presentment, protest, notice of
notices delivered or demand made on Comercial or action or delinquency in
respect of the Guaranteed Obligations or any part thereof, including any right
to require the Administrative Agent, the Collateral Agent, and the Lenders to
xxx Comercial, any other guarantor or any other Person obligated with respect
to the Guaranteed Obligations or any part thereof, or otherwise to enforce
payment thereof against any collateral securing the Guaranteed Obligations or
any part thereof; provided, that if at any time any payment of any portion of
the Guaranteed Obligations is rescinded or must otherwise be restored or
returned upon the insolvency, bankruptcy or reorganization of Comercial or
otherwise, Vitrocrisa's obligations hereunder with respect to such payment
shall be reinstated at such time as though such payment had not been made and
whether or not the Administrative Agent, the Collateral Agent, or the Lenders
are in possession of this guaranty. The Administrative Agent and the Lenders
shall have no obligation to disclose or discuss with Vitrocrisa their
assessments of the financial condition of Comercial.
Vitrocrisa hereby expressly waives any right, beneficio de orden,
division and excusion and any of the rights provided for in Articles 2813,
2814, 2815, 2816, 2817, 2818, 2820, 2821, 2822, 2823, 2836, 2840, 2842, 2844,
2845, 2846, 2847, 2848, 2849 et al of the Federal Civil Code and the
corresponding provisions of the Civil Code for the Federal District of Mexico,
and the Civil Codes for all of the States of Mexico, which are not reproduced
herein inasmuch as Vitrocrisa hereby represents to be familiar with the
contents thereof, as well as all other rights and defenses the assertion or
exercise of which would in any way diminish the liability of Vitrocrisa
hereunder.
10.3 Guaranty Absolute. This guaranty is a guaranty of payment and
not of collection, is a primary obligation of Vitrocrisa and not merely one of
surety, and the validity and enforceability of this guaranty shall be absolute
and unconditional irrespective of, and shall not be impaired or affected by
any of the following: (a) any extension, modification or renewal of, or
indulgence with respect to, or substitutions for, the Guaranteed Obligations
or any part thereof or any agreement relating thereto at any time; (b) any
failure or omission to enforce any right, power or remedy with respect to the
Guaranteed Obligations or any part thereof or any agreement relating thereto,
or any collateral; (c) any waiver of any right, power or remedy with respect
to the Guaranteed Obligations or any part thereof or any agreement relating
thereto or with respect to any collateral; (d) any release, surrender,
compromise, settlement, waiver,
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subordination or modification, with or without consideration, of any
collateral, or any other guaranties with respect to the Guaranteed Obligations
or any part thereof; (e) the enforceability or validity of the Guaranteed
Obligations or any part thereof or the genuineness, enforceability or validity
of any agreement relating thereto or with respect to any collateral; (f) the
application of payments received from any source to the payment of obligations
other than the Guaranteed Obligations, any part thereof or amounts which are
not covered by this guaranty even though the Administrative Agent, the
Collateral Agent, and the Lenders might lawfully have elected to apply such
payments to any part or all of the Guaranteed Obligations or to amounts which
are not covered by this guaranty; (g) any change in the ownership of Comercial
or the insolvency, bankruptcy or any other change in the legal status of
Comercial; (h) the change in or the imposition of any law, decree, regulation
or other governmental act which does or might impair, delay or in any way
affect the validity, enforceability or the payment when due of the Guaranteed
Obligations; (i) the failure of Vitrocrisa or Comercial to maintain in full
force, validity or effect or to obtain or renew when required all governmental
and other approvals, licenses or consents required in connection with the
Guaranteed Obligations or this guaranty, or to take any other action required
in connection with the performance of all obligations pursuant to the
Guaranteed Obligations or this guaranty; (j) the existence of any claim,
setoff or other rights which Vitrocrisa may have at any time against Comercial
or any other Person in connection herewith or an unrelated transaction; or (k)
any other circumstance, whether or not similar to any of the foregoing, which
could constitute a defense to a guarantor (other than indefeasible payment in
full in cash of the Guaranteed Obligations); all whether or not Vitrocrisa
shall have had notice or knowledge of any act or omission referred to in the
foregoing clauses (a) through (k) of this Section. It is agreed that
Vitrocrisa's liability hereunder is several and independent of any other
guaranties or other obligations at any time in effect with respect to the
Guaranteed Obligations or any part thereof and that Vitrocrisa's liability
hereunder may be enforced regardless of the existence, validity, enforcement
or non-enforcement of any such other guaranties or other obligations or any
provision of any applicable law or regulation purporting to prohibit payment
by Comercial of the Guaranteed Obligations in the manner agreed upon by
Comercial and the Administrative Agent, the Collateral Agent, and the Lenders.
10.4 Acceleration. Vitrocrisa agrees that, as between Vitrocrisa
on the one hand, and the Lenders, the Collateral Agent, and the Administrative
Agent, on the other hand, the obligations of Comercial guaranteed under this
Section 10 may be declared to be forthwith due and payable, or may be deemed
automatically to have been accelerated, as provided in Section 9 hereof for
purposes of this Section 10, notwithstanding any stay, injunction or other
prohibition (whether in a bankruptcy proceeding affecting Comercial or
otherwise) preventing such declaration as against Comercial and that, in the
event of such declaration or automatic acceleration, such obligations (whether
or not due and payable by Comercial) shall forthwith become due and payable by
Vitrocrisa for purposes of this Section 10.
10.5 Marshaling; Reinstatement. None of the Lenders nor the
Administrative Agent nor any Person acting for or on behalf of the Lenders,
the Collateral Agent, or the Administrative Agent shall have any obligation to
marshal any assets in favor of Vitrocrisa or against or in payment of any or
all of the Guaranteed Obligations. If Vitrocrisa, Comercial or any other
guarantor of all or any part of the Guaranteed Obligations makes a payment or
payments to any Lender, the Collateral Agent, or the Administrative Agent, or
if any Lender, the Collateral Agent, or the Administrative Agent receives any
proceeds of collateral, which
63
payment or payments or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside and/or required to be repaid to
Comercial, Vitrocrisa, such other guarantor or any other Person, or their
respective estates, trustees, receivers or any other party, including, without
limitation, Vitrocrisa, under any bankruptcy law, state or federal law, common
law or equitable cause, then, to the extent of such payment or repayment, the
part of the Guaranteed Obligations which has been paid, reduced or satisfied
by such amount shall be reinstated and continued in full force and effect as
of the time immediately preceding such initial payment, reduction or
satisfaction.
10.6 Waiver of Subrogation and Contribution. Until the Guaranteed
Obligations have been paid in cash indefeasibly in full and the Commitments by
the Lenders to Comercial shall have terminated, Vitrocrisa hereby irrevocably
waives any claim or other rights which it may now or hereafter acquire against
Comercial or any other Person that arise from the existence, payment,
performance or enforcement of Vitrocrisa's obligations under this guaranty or
any other Transaction Document, including any right of subrogation,
reimbursement, contribution, exoneration, or indemnification, any right to
participate in any claim or remedy of the Administrative Agent, the Collateral
Agent, or any Lender against Comercial or any other Person or any collateral
which the Administrative Agent, the Collateral Agent or any Lender now has or
hereafter acquires, whether or not such claim, remedy or right arises in
equity, or under contract, statute or common law, including the right to take
or receive from Comercial or any other Person, directly or indirectly, in cash
or other property or by set-off or in any manner, payment or security on
account of such claim or other rights. If any amount shall be paid to
Vitrocrisa in violation of the preceding sentence and the Guaranteed
Obligations shall not have been paid in cash indefeasibly in full and the
Commitments shall not have been terminated, such amount shall be deemed to
have been paid to Vitrocrisa for the benefit of, and held in trust for, the
Administrative Agent, the Collateral Agent and the Lenders, and shall
forthwith be paid to the Administrative Agent for the account of the
Administrative Agent and the Lenders to be credited and applied upon the
Guaranteed Obligations, whether matured or unmatured. Vitrocrisa acknowledges
that it will receive direct and indirect benefits from the financing
arrangements contemplated by this Agreement and that the waiver set forth in
this Section is knowingly made in contemplation of such benefits. If (a)
Vitrocrisa has made payment to the Administrative Agent, the Collateral Agent,
and the Lenders of all or any part of the Guaranteed Obligations and (b) the
Guaranteed Obligations have been paid in full and the Commitments have been
terminated, the Administrative Agent, the Collateral Agent, and the Lenders
agree to execute and deliver to Vitrocrisa appropriate documents (without
recourse and without representation and warranty) necessary to evidence the
transfer by subrogation to Vitrocrisa of an interest in the Guaranteed
Obligations resulting from such payment by Vitrocrisa.
Section 11. The Agents.
11.1 Appointment of the Agents. The Lenders hereby appoint and
designate Bank of Montreal as Administrative Agent and the Tranche A Lenders
hereby appoint and designate HSBC Bank USA and HSBC Mexico, S.A. as Collateral
Agents, in each case to act in such capacity as specified herein and in the
other Transaction Documents. Each Lender hereby irrevocably authorizes, and
each holder of any Note by the acceptance of such Note shall be deemed
irrevocably to authorize, the Administrative Agent and the Collateral Agents
to take such action on its behalf under the provisions of this Agreement, the
other Transaction
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Documents and any other instruments and agreements referred to herein or
therein and to exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of the Administrative
Agent and the Collateral Agents, as the case may be, by the terms hereof and
thereof and such other powers as are reasonably incidental hereto and thereto.
The Administrative Agent and the Collateral Agents may perform any of their
respective duties hereunder and under the other Transaction Documents by or
through its officers, directors, agents or employees.
11.2 Nature of Duties. None of the Administrative Agent, the
Collateral Agents or the Arranger shall have any duties or responsibilities
except those expressly set forth in this Agreement and in the other
Transaction Documents. None of the Administrative Agent, the Collateral
Agents, the Arranger, or any of their respective officers, directors, agents
or employees, shall be liable for any action taken or omitted by it or them
hereunder or under any other Transaction Document or in connection herewith or
therewith, unless resulting solely by its or their gross negligence or willful
misconduct. The duties of the Administrative Agent and the Collateral Agents
shall be mechanical and administrative in nature; none of the Administrative
Agent, the Collateral Agent nor the Arranger shall have by reason of this
Agreement or any other Transaction Document a fiduciary relationship in
respect of any Lender or the holder of any Note; and nothing in this Agreement
or any other Transaction Document, expressed or implied, is intended to or
shall be so construed as to impose upon the Administrative Agent, the
Collateral Agents or the Arranger any obligations in respect of this Agreement
or any other Transaction Document except as expressly set forth herein.
11.3 No Reliance on the Agents. Independently and without reliance
upon the Administrative Agent, the Collateral Agents or the Arranger, each
Lender and the holder of each Note, to the extent it deems appropriate, has
made and shall continue to make (i) its own independent investigation of the
financial condition and affairs of Comercial, Vitrocrisa, Vitro, Libbey, and
each US Affiliate in connection with the making of its Commitments and the
continuance of the Loans and the taking or not taking of any action in
connection herewith and (ii) its own appraisal of the creditworthiness of
Comercial, Vitrocrisa, Vitro, Libbey, and each US Affiliate and their
respective Affiliates and, except as expressly provided in this Agreement,
none of the Administrative Agent, the Collateral Agents, or the Arranger shall
have any duty or responsibility, either initially or on a continuing basis, to
provide any Lender or the holder of any Note with any credit or other
information with respect thereto, whether coming into its possession before
the making of the Loans or at any time or times thereafter. None of the
Administrative Agent, the Collateral Agents or the Arranger shall be
responsible to any Lender or the holder of any Note for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability,
perfection, collectability, priority or sufficiency of this Agreement or any
other Transaction Document or the financial condition of each of Comercial,
Vitrocrisa, Vitro, Libbey, and each US Affiliate and their respective
Affiliates or be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of
this Agreement or any other Transaction Document, or the financial condition
of each of Comercial, Vitrocrisa, Vitro, Libbey, and each US Affiliate and
their respective Affiliates or the existence or possible existence of any
Default or Event of Default.
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11.4 Certain Rights of the Agents. (a) If the Administrative
Agent, or either Collateral Agent shall request instructions from the Required
Tranche A Lenders, Required Tranche A Revolving Lenders, Required Tranche B
Lenders and/or Supermajority Lenders, as the case may be, with respect to any
act or action (including failure to act) in connection with this Agreement or
any other Transaction Document, then the Administrative Agent and such
Collateral Agent, respectively, shall be entitled to refrain from such act or
taking such action unless and until it shall have received instructions from
such Lenders, and, in any such event, neither the Administrative Agent nor the
Collateral Agents shall incur liability to any Person by reason of so
refraining. Without limiting the generality of the foregoing, no Lender or the
holder of any Note shall have any right of action whatsoever against the
Administrative Agent or either Collateral Agent as a result of acting or
refraining from acting hereunder or under any other Transaction Document in
accordance with the instructions of the Required Tranche A Lenders, Required
Tranche A Revolving Lenders, Required Tranche B Lenders and/or Supermajority
Lenders, as the case may be.
(b) If either Collateral Agent shall request instructions from the
Tranche A Lenders with respect to any action (including failure to act) in
connection with this Agreement or any other Transaction Document, then such
Collateral Agent shall be entitled to refrain from such act or taking such
action unless and until it shall have received instructions from the Tranche A
Lenders, and in any such event, such Collateral Agent shall not incur
liability to any Person by reason of so refraining. Without limiting the
generality of the foregoing, no Lender or the holder of any Note shall have
any right of action whatsoever against the Collateral Agents as a result of
acting or refraining from acting hereunder or under any other Transaction
Document in accordance with the instructions of the Tranche A Lenders.
11.5 Reliance by the Administrative Agent and the Collateral
Agents. The Administrative Agent and the Collateral Agents shall be entitled
to rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by any Person that such Agent believed to be the proper
Person, and, with respect to all legal matters pertaining to this Agreement
and any other Transaction Document and its duties hereunder and thereunder,
upon advice of counsel selected by it.
11.6 Indemnification. To the extent the Administrative Agent, the
Collateral Agents, the Arranger or any of their respective officers,
directors, agents or employees are not reimbursed and indemnified by Comercial
or Vitrocrisa, the Lenders (or in the case of the Collateral Agents, the
Tranche A Lenders) will reimburse and indemnify each such Person, in
proportion to their outstanding Notes, for and against any and all
liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses or disbursements of whatsoever kind or
nature which may be imposed on, asserted against or incurred by each such
Person, in performing its duties hereunder or under any other Transaction
Document, or in any way relating to or arising out of this Agreement or any
other Transaction Document; provided, that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting solely from the
gross negligence or willful misconduct of such Person.
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11.7 Capacity as Lenders. With respect to its obligation to make
Loans under this Agreement, the Administrative Agent, the Collateral Agents
and the Arranger shall have the rights and powers specified herein for a
"Lender" and may exercise the same rights and powers as though it were not
performing the duties specified herein; and the term "Lenders," "Required
Lenders," "Required Tranche A Lenders," "Required Tranche B Lenders," Required
Tranche A Revolving Lenders," "Supermajority Lenders," "holders of Notes" or
any similar terms shall, unless the context clearly otherwise indicates,
include the Administrative Agent and the Arranger in its individual capacity.
The Administrative Agent, the Collateral Agents and the Arranger may accept
deposits from, lend money to, and generally engage in any kind of banking,
trust or other business with Comercial, Vitrocrisa, Vitro, Libbey or any
Affiliate of Vitrocrisa, Comercial, Vitro, or Libbey as if it were not
performing the duties specified herein, and may accept fees and other
consideration from Comercial, Vitrocrisa, Vitro, Libbey or such Affiliate for
services in connection with this Agreement and otherwise without having to
account for the same to the Lenders.
11.8 Holders. The Administrative Agent and the Collateral Agents
may deem and treat the payee of any Note as the owner thereof for all purposes
hereof unless and until a written notice of the assignment, transfer or
endorsement thereof, as the case may be, shall have been filed with such
Agent. Any request, authority or consent of any Person who, at the time of
making such request or giving such authority or consent, is the holder of any
Note shall be conclusive and binding on any subsequent holder, transferee,
assignee or endorsee, as the case may be, of such Note or of any Note or Notes
issued in exchange therefor.
11.9 Resignation.
(a) Bank of Montreal, HSBC Bank USA and/or HSBC Mexico, S.A. may
resign from the performance of their respective duties as Administrative Agent
and Collateral Agent hereunder and/or under the other Transaction Documents at
any time by giving 15 Business Days' prior written notice to Comercial and the
Lenders and the other Agent. Such resignation shall take effect upon the
appointment of a successor Administrative Agent or Collateral Agent, as the
case may be, pursuant to clauses (b), (c) and (d) below or as otherwise
provided below.
(b) Upon any such notice of resignation, the Lenders shall appoint
a successor Administrative Agent or Collateral Agent, as the case may be,
hereunder or thereunder who shall be an internationally-recognized commercial
bank or trust company reasonably acceptable to Comercial (except that no such
consent shall be necessary during a Default).
(c) If a successor Administrative Agent or Collateral Agent, as
the case may be, shall not have been so appointed within such 15 Business Day
period, the Administrative Agent, with the consent of Comercial (except that
no such consent shall be necessary during a Default), may then appoint a
successor Administrative Agent, or the Collateral Agents may petition a court
of competent jurisdiction to appoint a successor Collateral Agent, who shall
serve as such hereunder or thereunder until such time, if any, as the Lenders
appoint a successor as provided above.
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(d) If no successor has been appointed pursuant to clause (b) or
(c) above by the 20th Business Day after the date such notice of resignation
was given by the Administrative Agent or the Collateral Agent, as the case may
be, the resignation shall become effective and the Lenders shall thereafter
perform all the duties of the Administrative Agent or Collateral Agent, as the
case may be, hereunder and/or under any other Transaction Document until such
time, if any, as the Lenders appoint a successor as provided above.
11.10 Mexican Income Tax Law.
(a) Each Lender represents and warrants to Comercial and the
Administrative Agent on the date hereof that it (i) (A) has been registered,
and will use reasonable efforts, subject to overall policy considerations, to
maintain in force such Lender's registration (the "Registration") during the
time such Lender is a party hereto, as a financial institution with the SHCP
for purposes of Article 195(I) of the Mexican Income Tax Law (or successor
provision), and (B) is a resident of a country with which Mexico has entered
into a treaty for the avoidance of double taxation which is in effect in such
country or (ii) is exempt from Mexican withholding taxes (including as a
result of being a development bank).
(b) Comercial agrees and acknowledges that, despite the reasonable
efforts of the Lenders relying on the representation made in Section
11.10(a)(i), the maintenance of the Registration of a Lender may not be
practicable, and, accordingly, agrees that if, after the exercise of such
reasonable efforts, a Lender is not able to maintain such Registration and any
such inability is not reasonably the fault of such Lender, such Lender shall
try to sell its Loan to a financial institution which meets the requirements
of Section 11.10(a)(i) or (ii), but nevertheless Comercial will continue to
pay Additional Costs when due, to the extent provided in Section 4.4. In the
case of the Lenders making the representations in Section 11.10(a)(i)(B) or
Section 11.10(a)(ii), if a Lender is notified by Comercial or has otherwise
actual knowledge that the applicable double taxation treaty or the applicable
Mexican legislation, as the case may be, ceases to be in effect, such Lender
shall try to sell its Loan to a financial institution which meets the
requirements of Section 11.10(a)(i) or (ii) above, at the cost of Comercial
and at a price satisfactory to that Lender, but nevertheless Comercial agrees
that it shall continue to pay Additional Costs when due, to the extent
provided in Section 4.4. Comercial also agrees and acknowledges that,
notwithstanding the provisions of Section 11.10(a), if any Lender (i)
determines (which determination shall, absent manifest error, be final and
conclusive) that maintenance of its Registration would cause such Lender to
suffer any material legal, regulatory or economic disadvantage, such Lender
shall not be required to maintain such Registration or (ii) ceases to be
resident of a country with which Mexico has a treaty for the avoidance of
double taxation in effect or (iii) ceases to be otherwise exempt from Mexican
withholding taxes, Comercial may, at its option, designate another bank that
meets the requirements of Section 11.10(a)(i) or (ii) to replace such Lender
by purchasing such Lender's outstanding Loans for a purchase price equal to
the outstanding principal amount of the Loans payable to such Lender plus any
accrued and unpaid interest, fees and other accrued unpaid amounts payable to
such Lender under the Transaction Documents; such affected Lender will
consummate such sale in accordance with such terms within a reasonable period
of time not exceeding five (5) Business Days from the date Comercial shall
have designated a replacement lender subject to such Lender's receipt of the
purchase price in immediately available funds and compliance with Section
12.5.
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Section 12. Miscellaneous.
12.1 Payment of Expenses, etc. Comercial shall: (i) whether or not
the transactions herein contemplated are consummated, pay, from time to time
upon request, all reasonable out-of-pocket costs and expenses of (x) the
Administrative Agent (including, without limitation, the reasonable costs and
expenses of the syndication of the Loans, the reasonable fees and
disbursements of Mayer, Brown, Xxxx & Maw LLP as special U.S. counsel to the
Arranger and the Administrative Agent and of Xxxxx & XxXxxxxx as special
Mexican counsel to the Arranger and the Administrative Agent, and reasonable
printing, document production and delivery, communication, travel and
publicity costs) incurred in connection with the preparation, review,
negotiation, translation, execution, delivery, syndication and administration
of this Agreement and the other Transaction Documents and the documents and
instruments prepared in connection herewith or in anticipation hereof and any
amendment, waiver or consent relating hereto or thereto, and (y) the
Administrative Agent and each of the Lenders in connection with the
enforcement of this Agreement and the other Transaction Documents and the
documents and instruments referred to herein and therein (including, without
limitation, the reasonable fees and disbursements of counsel for the
Administrative Agent and for each of the Lenders); (ii) pay and hold each of
the Lenders harmless from and against any and all present and future stamp and
other similar taxes with respect to the foregoing matters and save and hold
each of the Lenders harmless from and against any and all liabilities with
respect to or resulting from any delay or omission (other than to the extent
attributable to such Lender) to pay such taxes; and (iii) indemnify the
Administrative Agent, the Arranger and each Lender, and their respective
officers, directors, employees, representatives and agents (each an
"indemnified person") from and hold each of them harmless against any and all
liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses and disbursements incurred by any of them as
a result of, or arising out of, or in any way related to, or by reason of, any
investigation, litigation or other proceeding (whether or not the indemnified
person is a party thereto) related to the entering into and/or performance of
this Agreement or any other Transaction Document or the use of the proceeds of
any Loans hereunder or the consummation of any transactions contemplated
herein or in any other Transaction Document, including, without limitation,
the reasonable fees and disbursements of counsel incurred in connection with
any such investigation, litigation or other proceeding (but excluding any such
liabilities, obligations, losses, etc., to the extent incurred solely by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). Each of Comercial and Vitrocrisa hereby waives and releases each
Lender, the Arranger and the Administrative Agent from, and agrees not to
pursue against them, any claim for consequential, special or punitive damages.
12.2 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, the Administrative
Agent, the Collateral Agent and each Lender is hereby authorized at any time
or from time to time, without presentment, demand, protest or other notice of
any kind to Comercial, Vitrocrisa or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and apply any and
all deposits (general or special) and any other Indebtedness at any time held
or owing by such Lender (including without limitation by branches and agencies
of such Lender wherever located) to or for the credit or the account of
Comercial or Vitrocrisa against and on account of the Obligations and
liabilities of Comercial to such Lender, the Collateral Agent or the
Administrative Agent under this
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Agreement or under any of the other Transaction Documents, including, without
limitation, all interests in Obligations purchased by such Lender pursuant to
Section 12.7(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Transaction Document,
irrespective of whether or not such Lender, the Collateral Agent or the
Administrative Agent shall have made any demand hereunder and although said
Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
12.3 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including facsimile communication) and sent by facsimile, private express
courier or delivered: if to Comercial or Vitrocrisa, to its address specified
opposite its signature below (in the case of a notice of acceleration or an
amendment to increase the rate set forth in the definition of the term
"Tranche B Applicable Margin" or notice of the occurrence of an Event of
Default, with a copy to Libbey at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxx 00000,
Attention: VP and Treasurer, Telephone: (000) 000-0000, Facsimile: (419)
325-2117); if to any Lender, at its Lending Offices specified opposite its
name on Schedule II; if to the Administrative Agent or the Collateral Agent,
at their respective Notice Offices; or, as to Comercial, Vitrocrisa, the
Collateral Agent or the Administrative Agent, at such other address as shall
be designated by such party in a written notice to the other parties hereto
and, as to each other party, at such other address as shall be designated by
such party in a written notice to Comercial, the Collateral Agent and the
Administrative Agent. All such notices and communications shall, when sent by
facsimile or private express courier, be effective when sent by facsimile, or
delivered to such private express courier, as the case may be, in each case
confirmed by telephone, except that notices and communications to the
Administrative Agent or to the Collateral Agent shall not be effective until
received by such Agent.
12.4 Benefit of Agreement. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided, that neither Comercial nor
Vitrocrisa may assign or transfer any of its rights or obligations hereunder
without the prior written consent of all of the Lenders.
12.5 Syndication or Assignment of Loans.
(a) Each Lender may at any time, (i) grant participations in the
Loans made hereunder (provided, that the Person purchasing any such
participation shall have voting rights only in respect of those issues set
forth in the first proviso to Section 12.14) or (ii) transfer or assign
pursuant to an assignment and assumption agreement substantially in the form
of Exhibit F hereto (each a "Lender Assignment Agreement"), any of its rights
hereunder or under any of the Notes; provided, however, that any such transfer
or assignment by a Lender pursuant to this clause (ii) to any lending
institution other than one of the other Lenders or any Affiliate of any Lender
of a portion of its rights hereunder or under any Note shall (w) be for an
amount not less than U.S.$1,000,000 or a higher integral multiple of
U.S.$1,000,000 in each instance, (x) be made only upon the making by any such
lending institution of the representations and warranties contained in Section
11.10 hereof, (y) be subject to the prior consent of Comercial (except upon
Default) and the Administrative Agent (which consent by Comercial (if
required) or by the Administrative Agent shall not be unreasonably withheld,
delayed or conditioned), and (z) be effective only upon payment by the
assignee or assignor to the Administrative Agent of an
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administrative processing fee of U.S.$3,500. If any Lender transfers or
assigns all or a part of its rights and obligations hereunder or under the
Notes to any other financial institution, such financial institution shall be
a party hereto and, to the extent that rights and obligations hereunder have
been transferred or assigned to it, shall have the rights and obligations of a
Lender hereunder and under the other Transaction Documents, and this Agreement
shall be deemed to be amended to the extent necessary to reflect the transfer
and assignment of such rights and obligations and the addition of such
financial institution, and any reference to the transferring or assigning
Lender in this Agreement, the other Transaction Documents or the Note of such
Lender shall thereafter refer to such Lender and to such other financial
institution to the extent of their respective interests.
(b) Not later than five Business Days after the receipt of a
notice from the Administrative Agent that a Lender has assigned all or a
portion of its Loans hereunder in accordance with the provisions hereof,
Comercial, Vitrocrisa and Vitro, as applicable, will, at their expense,
execute and deliver to the Administrative Agent new Notes prepared in
conformity herewith evidencing the assigned Loans and, if the assigning Lender
has retained a portion of its Loans, replacement Notes in the principal amount
of the Loans retained by the assigning Lender; provided, however, that the
Administrative Agent shall have notified Comercial that it has possession of
the assigning Lender's Note or Notes for exchange and that it will deliver to
Comercial such Note or Notes upon receipt of the new Notes referred to above.
12.6 No Waiver; Remedies Cumulative. No failure or delay on the
part of any of the Administrative Agent or any Lender or the holder of any
Note in exercising any right, power or privilege hereunder or under any other
Transaction Document and no course of dealing between (a) Comercial or
Vitrocrisa, on the one hand and (b) the Administrative Agent, the Collateral
Agent or any Lender or the holder of any Note, on the other hand, shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Transaction Document
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder or thereunder. The rights, powers and
remedies herein or in any other Transaction Document expressly provided are
cumulative and not exclusive of any rights, powers or remedies which any of
the Administrative Agent, the Collateral Agent or any Lender or the holder of
any Note would otherwise have. No notice to or demand on Comercial or
Vitrocrisa or any other Person in any case shall entitle Comercial or
Vitrocrisa or any other Person to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of any of
the Administrative Agent, the Collateral Agent or any Lender or the holder of
any Note to any other or further action in any circumstances without notice or
demand.
12.7 Payments Pro Rata.
(a) The Administrative Agent agrees that promptly after its
receipt of any payment (other than payments pursuant to Section 3) from or on
behalf of Comercial in respect of any Obligations of Comercial hereunder, it
shall distribute such payment to the Lenders pro rata based upon their
respective shares, if any, of the Obligations with respect to which such
payment was received.
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(b) Each of the Lenders agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization upon security,
by the exercise of the right of setoff or banker's lien, by counterclaim or
cross action, by the enforcement of any right under the Transaction Documents,
or otherwise), which can or may be applicable to the payment of the principal
of, or interest on, the Loans or any Fee related thereto, of a sum which with
respect to the related sum or sums received by other Lenders is in a greater
proportion than the total amount of the relevant Obligation then owed and due
to such Lender bears to the total amount of such Obligation then owed and due
to all the Lenders immediately prior to such receipt, then such Lender
receiving such excess payment shall purchase for cash without recourse or
warranty from the other Lenders having an interest in the related Obligations
of Comercial to such Lenders in such amount as shall result in a proportional
participation by all the Lenders having an interest in the related Obligations
in such amount; provided, however, that if all or any portion of such excess
amount is thereafter recovered from such Lender, such purchase shall be
rescinded and the purchase price restored to the extent of such recovery, but
without interest. It is understood and agreed that nothing herein contained
shall require a Lender who does not have an interest in Tranche A Loans to
purchase a participation in a Tranche A Loan or a Fee related thereto or a
Lender who does not have an interest in Tranche B Loans to purchase a
participation in a Tranche B Loan or a Fee related thereto. Comercial and
Vitrocrisa agree that any Lender so purchasing a participation from another
Lender pursuant to this Section 12.7 may, to the fullest extent permitted by
law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of Comercial in the amount of such participation.
12.8 Calculations; Computations.
(a) The financial statements to be furnished to the Lenders
pursuant hereto shall be made and prepared in accordance with GAAP.
(b) All computations of interest for LIBOR Loans and Fees
hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring
in the period for which such interest or Fees are payable. All computations of
interest for Base Rate Loans shall be made on the basis of the actual number
of days in the applicable year and actual days elapsed.
12.9 Governing Law; Submission to Jurisdiction; Venue.
(a) This Agreement and the other Transaction Documents and the
rights and obligations of the parties hereunder and thereunder shall be
construed in accordance with and be governed by the law of the State of New
York without giving effect to the principles thereof relating to conflicts of
law (except Section 5-1401 of the New York General Obligations Law), except as
is otherwise specifically provided in such Transaction Document. Any legal
action or proceeding with respect to this Agreement or any other Transaction
Document may be brought in the courts of the State of New York sitting in the
City and the County of New York or of the United States for the Southern
District of New York or of the courts of the corporate domicile of a party
hereto in an action brought against it as a defendant, and, by execution and
delivery of this Agreement, each party hereby irrevocably accepts for itself
and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. Each of Comercial and
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Vitrocrisa hereby irrevocably designates, appoints and empowers the Process
Agent, as its designee, appointee and agent to receive, accept and acknowledge
for and on its behalf, and in respect of its property, service of any and all
legal process, summons, notices and documents which may be served in any
action or proceeding. If for any reason such designee, appointee and agent
shall cease to be available to act as such, Comercial or Vitrocrisa, as the
case may be, agrees to designate a new designee, appointee and agent in New
York City on the terms and for the purposes of this provision satisfactory to
the Administrative Agent; each such appointment shall be contained in a
notarial instrument. Each of Comercial and Vitrocrisa further irrevocably
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by personal delivery of certified copies thereof
to Comercial or Vitrocrisa, as applicable, at the address set forth opposite
its signature below. Nothing herein shall affect the right of the
Administrative Agent, any Lender or the holder of any Note to serve process in
any other manner permitted by law or to commence legal proceedings or
otherwise proceed against Comercial or Vitrocrisa in any other jurisdiction.
(b) Each of Comercial, Vitrocrisa, the Lenders and the Agents
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement or any other Transaction Document
brought in the courts referred to in clause (a) above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum.
(c) Each of Comercial and Vitrocrisa agrees, to the extent
permitted by applicable law, that in any legal action or proceeding arising
out of or in connection with this Agreement or any other Transaction Document
(the "Proceedings") anywhere (whether for an injunction, specific performance,
damages or otherwise), no immunity (to the extent that it may at any time
exist) from those Proceedings, from attachment (whether in aid of execution,
before judgment or otherwise), or from judgment shall be claimed by it or on
its behalf or with respect to its assets. Each of Comercial and Vitrocrisa
agrees, to the extent permitted by applicable law, that it is and its assets
are, and shall be, subject to such Proceedings, attachment or execution in
respect of its obligations under this Agreement and each other Transaction
Document to which it is party.
12.10 Obligation to Make Payments in Dollars. The obligation of
Comercial and Vitrocrisa to make payment in Dollars of the principal of and
interest on the Notes and any other amounts due hereunder or under any other
Transaction Document to the Payment Office of the Administrative Agent as
provided in Section 4.3 shall not be discharged or satisfied by any tender, or
any recovery pursuant to any judgment, which is expressed in or converted into
any currency other than Dollars, except to the extent such tender or recovery
shall result in the actual receipt by the Administrative Agent at its Payment
Office on behalf of the Lenders or holders of the Notes of the full amount of
Dollars expressed to be payable in respect of the principal of and interest on
the Notes and all other amounts due hereunder or under any other Transaction
Document. The obligation of Comercial and Vitrocrisa to make payments in
Dollars as aforesaid shall be enforceable as an alternative or additional
cause of action for the purpose of recovery in Dollars of the amount, if any,
by which such actual receipt shall fall short of the full amount of Dollars
expressed to be payable in respect of the principal of and interest on the
Notes and any other amounts due under any other Transaction Document, and
shall not be affected by judgment
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being obtained for any other sums due under this Agreement or under any other
Transaction Document.
12.11 Counterparts. This Agreement may be executed in any number
of counterparts (including via facsimile) and by the different parties hereto
on separate counterparts, each of which when so executed and delivered shall
be an original, but all of which shall together constitute one and the same
instrument.
12.12 Intercreditor Provisions. Each Tranche B Lender hereby
acknowledges and agrees that (a) it has received a copy of, and is familiar
with, and understands the contents of, this Agreement and the other
Transaction Documents, (b) this Agreement and the other Transaction Documents
contain provisions governing the application of payments with respect to the
Obligations that differentiate between the Obligations arising out of or
relating to the Tranche A Loans and the Obligations arising out of or relating
to the Tranche B Loans, and (c) the Obligations arising out of or relating to
the Tranche A Loans will be secured by the collateral purported to be granted
by the Collateral Documents and will have priority of payment with respect to
such collateral and the proceeds thereof whereas the Obligations arising out
of or relating to the Tranche B Loans will be unsecured and such Tranche B
Lender shall have no right or claim to any such collateral or the proceeds
thereof. Each Tranche B Lender further agrees (i) that it will not take any
action to challenge or otherwise contest the validity, perfection, priority or
enforceability of the Liens created by the Collateral Documents or the
priority of payment provisions contained in the Credit Agreement or any of the
other Transaction Documents, (ii) to cooperate in the defense of any action
contesting the validity, perfection, priority or enforceability of such Liens
or the validity or enforceability of the Credit Agreement or any of the other
Transaction Documents, and (iii) that without such Tranche B Lender's consent,
the Collateral Agent may exercise any remedies available to it with respect to
the Liens created by the Collateral Documents or any of the other Transaction
Documents.
12.13 Headings Descriptive. The headings of the several sections
and subsections of this Agreement are inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Agreement.
12.14 Amendment or Waiver. Except as specifically set forth in the
remainder of this Section 12.14, (a) neither this Agreement nor any of the
Subsidiary Guaranties, the Intercompany Note, the Accelerated Product Payment
Agreement, or any letter of credit delivered pursuant to Section 7.19 nor any
terms hereof or thereof may be changed, waived, discharged or terminated
unless such change, waiver, discharge or termination is in writing signed by
the Supermajority Lenders and the Administrative Agent; (b) none of the Vitro
Guaranty, the US Affiliate Guaranties, the Tranche A Notes, or the Collateral
Documents nor any terms thereof may be changed, waived, discharged or
terminated unless such change, waiver, discharge or termination is in writing
signed by (1) the Lenders holding at least 66 2/3% of the sum of the then
aggregate unpaid principal amount of the Tranche A Loans and the unused
Tranche A Total Commitment, and (2) the Administrative Agent; (c) none of the
Libbey Guaranty, the Tranche B Notes, or any letter of credit posted pursuant
to Section 9.13 hereof for the benefit of the Tranche B Lenders, nor any terms
thereof may be changed, waived, discharged or terminated unless such change,
waiver, discharge or termination is in writing signed by (A) the Lenders
holding at least 66 2/3% of the sum of the then aggregate unpaid principal
amount of
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the Tranche B Loans and the unused Tranche B Total Commitment, and (B) the
Administrative Agent; provided, however, that no such change, waiver,
discharge or termination shall, without the prior written consent of each
Lender, (i) increase the Commitment of any Lender over the amount thereof then
in effect (it being understood that a waiver of any Default or Event of
Default shall not constitute a change in the terms of any Commitment of any
Lender), (ii) amend, modify or waive any provision of this Section 12.14, of
Sections 2.1, 12.1, 12.2, 12.4, 12.5, 12.7, 12.8(b) or 12.12, (iii) reduce the
percentage specified in the definition of Required Tranche A Lenders, Required
Tranche B Lenders or Supermajority Lenders, (iv) consent to the assignment or
transfer by Comercial or Vitrocrisa of any of its rights and obligations under
this Agreement or under any of the other Transaction Documents or to the
assignment by the issuer bank of any obligations under a letter of credit
posted pursuant to this Agreement for the benefit of all of the Lenders or
reduce the amount payable thereunder or change the payment terms thereof or
(v) add any collateral or otherwise amend the description of the collateral
contained in any of the Collateral Documents or except to the extent permitted
pursuant to Section 8.1(f) increase the amount of the Indebtedness secured
thereby except to the extent provided in the Collateral Documents as in effect
on the Closing Date or as amended with the consent of all the Lenders; and
further provided, that no such change or waiver affecting the rights or duties
of the Administrative Agent or the Collateral Agent may be made without the
prior written consent of the Administrative Agent or of the Collateral Agent,
respectively. Neither this Agreement nor any other Transaction Document nor
any terms hereof or thereof may be changed, waived, discharged or terminated
so as to (x) release any collateral (including without limitation any letter
of credit) for the Tranche A Loans and the other Obligations related to the
Tranche A Loans, or release Comercial, Vitrocrisa, Vitro or any of the US
Affiliates from, or consent to the assignment of, any of their respective
obligations under the Transaction Documents relating to the Tranche A Loans,
the other Obligations related to the Tranche A Loans or the Tranche A Total
Commitment, or extend the final maturity or the scheduled date for repayment
of any Tranche A Loan, or reduce the interest rate or fees payable with
respect to the Tranche A Loans, or reduce the principal amount thereof,
without the prior written consent of all the Tranche A Lenders, or consent to
the assignment by the issuer bank of any obligations under a letter of credit
posted pursuant to this Agreement for the benefit of the Lenders having
Tranche A Loans or all or part of the Tranche A Total Commitment or reduce the
amount payable under such letters of credit or change the payment terms
thereof, or (y) release Comercial, Vitrocrisa, Libbey, or Libbey Glass from,
or consent to the assignment of, any of their respective obligations under the
Transaction Documents relating to the Tranche B Loans, or extend the final
maturity or the scheduled date for repayment of any Tranche B Loan, or reduce
the interest rate or fee payable with respect to the Tranche B Loans, or
reduce the principal amount thereof, without the consent of all the Tranche B
Lenders, or consent to the assignment by the issuer bank of any obligations
under a letter of credit posted pursuant to this Agreement for the benefit of
the Lenders having Tranche B Loans or all or part of the Tranche B Total
Commitment or reduce the amount payable under such letters of credit or change
the payment terms thereof without the consent of all the Tranche B Lenders or
(z) amend, modify or waive any provision of Section 5 or Section 2.1.2 without
the prior written consent of the Required Tranche A Revolving Lenders, or
amend, modify or waive any provision of Section 5 prior to the initial
Borrowing without the consent of the Required Tranche A Lenders and the
Required Tranche B Lenders.
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12.15 Survival. All indemnities set forth herein, including,
without limitation, in Sections 2.7, 2.8, 2.9, 4.4, 11.6 and 12.1, shall
survive the execution and delivery of this Agreement and the Notes and the
making and repayment of the Loans.
12.16 Domicile of Loans. Each Lender may transfer and carry its
Loans at, to or for the account of any office, Subsidiary or Affiliate of such
Lender.
12.17 WAIVER OF JURY TRIAL. EACH OF THE LENDERS, THE ARRANGER, THE
COLLATERAL AGENT, THE ADMINISTRATIVE AGENT, VITROCRISA AND COMERCIAL HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT ANY OF THEM MAY HAVE
TO A TRIAL BY JURY OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE NOTES
OR ANY OTHER TRANSACTION DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY
RELATING HERETO OR THERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
VITROCRISA, COMERCIAL, THE LENDERS, THE ARRANGER, THE COLLATERAL AGENT AND THE
ADMINISTRATIVE AGENT TO ENTER INTO THIS AGREEMENT.
[SIGNATURE PAGES FOLLOW]
76
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
VITROCRISA COMERCIAL, S.
DE X.X. DE C.V.
By: /s/ Xxxxxxx X. Xxxxx Xxxxxx
-----------------------------------------------
Name: Xxxxxxx X. Xxxxx Xxxxxx
Title: Attorney in Fact
By: /s/ Xxxx Xxxxxxx Xxxxx Vara
-----------------------------------------------
Name: Xxxx Xxxxxxx Xxxxx Xxxx
Title: Attorney in Fact
Address for Notices:
Vitrocrisa Comercial, S. de X.X. de X.X.
Xxxxxxx Norte 1627-B Colonia Terminal
Monterrey, Nuevo Xxxx, Mexico C.P. 64580
Attention: Xx. Xxxxxxxxx Xxxxxx Nin?o or
Xx. Xxxx Xxxxxxx Xxxxx Vara
Telephone: 000-00-00-0000-0000 or
011-52-81-1001-3117
Facsimile: 011-52-81-1001-3178 or
011-52-81-1001-3051
VITROCRISA, S. DE X.X. DE C.V.
By: /s/ Xxxxxxx X. Xxxxx Xxxxxx
-----------------------------------------------
Name: Xxxxxxx X. Xxxxx Xxxxxx
Title: Attorney in Fact
By: /s/ Xxxx Xxxxxxx Xxxxx Vara
-----------------------------------------------
Name: Xxxx Xxxxxxx Xxxxx Xxxx
Title: Attorney in Fact
Address for Notices:
Vitrocrisa, S. de X.X. de X.X.
Xxxxxxx Norte 1627-B Colonia Terminal
Monterrey, Nuevo Xxxx, Mexico C.P. 64580
Attention: Xx. Xxxxxxxxx Xxxxxx Nin?o or
Xx. Xxxx Xxxxxxx Xxxxx Vara
Telephone: 000-00-00-0000-0000 or
011-52-81-1001-3117
Facsimile: 011-52-81-1001-3178 or
011-52-81-1001-3051
ii
BANK OF MONTREAL, as the
Administrative Agent and a Tranche A Lender
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
iii
BANCO NACIONAL DE MEXICO, S.A.,
as a Syndication Agent
By: /s/ Xxxxxxxx Xxxxx Xxxxxxxx
-----------------------------------------------
Name: Xxxxxxxx Xxxxx Xxxxxxxx
Title: Director of Corporate Finances
By: /s/ Xxxx Xxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxx Xxxxxx Xxxxxxx
Title: Vice-President
iv
COMERICA BANK,
as a Tranche A Lender
By: /s/ Xxxxxxx X. xx Xxxxxxxx
-----------------------------------------------
Name: Xxxxxxx X. xx Xxxxxxxx
Title: Vice President
v
HSBC MEXICO, S.A., Institucion de
Banca Multiple, Grupo Financiero HSBC,
as a Tranche A Lender and as Collateral Agent
By: /s/ Xxxxx Casa De la Torre
-----------------------------------------------
Name: Xxxxx Casa De la Torre
Title: Corporate Bank
vi
THE BANK OF NOVA SCOTIA
as a Tranche B Lender
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Representative
vii
STANDARD FEDERAL BANK, N.A.,
as a Tranche B Lender
By: /s/ Xxxxxxxxxxx Xxxxxxxx
-----------------------------------------------
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Vice President
viii
XXXXXX XXXXXXX, as the Arranger and a
Syndication Agent
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
ix
HSBC BANK USA, as Collateral Agent
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
x
CITIBANK N.A., NASSAU BAHAMAS BRANCH, as Tranche A
Lender
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------------
Name: Xxxxxx Xxxxxx
Title: Attorney-in-Fact
Citibank N.A.
Nassau, Bahamas Branch
xi
Table of Contents
Page
Section 1. Definitions and Principles of Construction.................1
1.1 Defined Terms..............................................1
1.2 Principles of Construction................................17
Section 2. Amount and Terms of Loans.................................18
2.1 The Loans.................................................18
2.2 Notice of Borrowing.......................................19
2.3 Disbursement of Funds.....................................19
2.4 Notes.....................................................20
2.5 Several Commitments.......................................21
2.6 Interest..................................................21
2.7 Interest Periods..........................................22
2.8 Increased Costs, Illegality, etc..........................23
2.9 Compensation..............................................24
2.10 Change of Lending Office..................................25
Section 3. Fees......................................................25
3.1 Commitment Fee............................................25
3.2 Upfront and Structuring Fees..............................25
3.3 Administrative Agency Fee.................................25
3.4 Collateral Agency Fee.....................................26
Section 4. Prepayments; Payments.....................................26
4.1 Voluntary Prepayments.....................................26
4.2 Repayments; Mandatory Repayments..........................27
4.3 Method and Place of Payment...............................29
4.4 Net Payments..............................................29
Section 5. Conditions Precedent......................................30
5.1 Conditions Precedent to the Initial Borrowing
Date......................................................30
5.2 Conditions Precedent to Each Borrowing....................33
Section 6. Representations, Warranties and Agreements................34
6.1 Legal Status..............................................35
6.2 Power and Authority.......................................35
TABLE OF CONTENTS
(continued)
6.3 No Immunity...............................................35
6.4 No Violation..............................................35
6.5 Governmental Approvals....................................36
6.6 Litigation................................................36
6.7 Financial Statements; No Material Adverse
Change; Liens.............................................36
6.8 Use of Proceeds...........................................37
6.9 Properties................................................37
6.10 Patents, Licenses, Franchises and Formulas................37
6.11 True and Complete Disclosure..............................38
6.12 Tax Returns and Payments..................................38
6.13 Employee Benefit Plans....................................38
6.14 Labor Relations...........................................38
6.15 Capitalization............................................39
6.16 Subsidiaries..............................................39
6.17 Compliance with Statutes, etc.............................39
6.18 Availability and Transfer of Foreign Currency.............39
6.19 Fees and Enforcement......................................40
6.20 Investment Company Act....................................40
6.21 Public Utility Holding Company Act........................40
6.22 Solvency..................................................40
6.23 Other Creditors...........................................40
6.24 Pari Passu Status, etc....................................40
Section 7. Affirmative Covenants.....................................41
7.1 Information Covenants.....................................41
7.2 Books, Records and Inspections; Accounting
Matters; Provision of Certain Financial Statements........43
7.3 Compliance with Statutes, etc.............................43
7.4 Taxes; Labor..............................................43
7.5 Corporate Franchises, etc.................................44
7.6 Maintenance of Property, Insurance........................44
TABLE OF CONTENTS
(continued)
7.7 Use of Proceeds...........................................44
7.8 Conduct of Business.......................................44
7.9 Governmental Licenses, etc................................44
7.10 Performance of Obligations................................45
7.11 Compliance with Terms of Leaseholds.......................45
7.12 Maintenance of Pari Passu Status; Priority
of Liens..................................................45
7.13 Future Subsidiaries.......................................45
7.14 Further Assurances........................................46
7.15 Process Agent.............................................46
7.16 Security..................................................46
7.17 Vitrocrisa Comercial Collection Account...................46
7.18 Reserve Account...........................................47
7.19 Reduction of Ratio of Consolidated Indebtedness
to Combined Operating Cash Flow...........................47
7.20 Excess Cash Flow Prepayments..............................48
Section 8. Negative Covenants........................................49
8.1 Liens.....................................................49
8.2 Dividends.................................................50
8.3 Indebtedness..............................................51
8.4 Investments...............................................51
8.5 Consolidations, Mergers...................................52
8.6 Sales of Assets...........................................53
8.7 Consolidated Interest Coverage Ratio......................54
8.8 Consolidated Leverage Ratio...............................54
8.9 Net Worth.................................................54
8.10 Limitations on Modifications of Certain
Agreements; etc...........................................54
8.11 No Other Business.........................................54
8.12 Transactions with Affiliates..............................54
8.13 Limitation on Restrictions on Subsidiary
Dividends and Other Distributions.........................55
8.14 Inconsistent Agreements...................................55
8.15 Change in Accounting Policies.............................55
TABLE OF CONTENTS
(continued)
8.16 Subsidiaries..............................................55
8.17 Sale-leaseback Transactions...............................55
8.18 Operating Leases..........................................55
8.19 Minimum Operating Cash Flow...............................56
8.20 Minimum Debt Service Coverage Ratio.......................56
8.21 Fixed Charge Coverage Ratio...............................57
Section 9. Events of Default.........................................57
9.1 Payments..................................................57
9.2 Representations, etc......................................57
9.3 Covenants.................................................57
9.4 Payment Default Under Other Agreements....................57
9.5 Acceleration of Indebtedness..............................58
9.6 Bankruptcy, etc...........................................58
9.7 Judgments.................................................58
9.8 Cancellation of Payment Obligation........................58
9.9 Government Action.........................................59
9.10 Failure of Enforceability.................................59
9.11 Change in Control.........................................59
9.12 Imposition of Exchange Restrictions.......................59
9.13 Guarantor Default Under Libbey Guaranty or
Vitro Guaranty............................................59
9.14 Guarantor Default Under US Affiliate
Guaranty or Subsidiary Guaranty, etc......................61
Section 10. Guaranty..................................................63
10.1 Guaranty..................................................63
10.2 Waivers...................................................63
10.3 Guaranty Absolute.........................................64
10.4 Acceleration..............................................65
10.5 Marshaling; Reinstatement.................................65
10.6 Waiver of Subrogation and Contribution....................65
TABLE OF CONTENTS
(continued)
Section 11. The Agents................................................66
11.1 Appointment of the Agents.................................66
11.2 Nature of Duties..........................................66
11.3 No Reliance on the Agents.................................67
11.4 Certain Rights of the Agents..............................67
11.5 Reliance by the Administrative Agent and
the Collateral Agents.....................................68
11.6 Indemnification...........................................68
11.7 Capacity as Lenders.......................................68
11.8 Holders...................................................68
11.9 Resignation...............................................69
11.10 Mexican Income Tax Law....................................69
Section 12. Miscellaneous.............................................70
12.1 Payment of Expenses, etc..................................70
12.2 Right of Setoff...........................................71
12.3 Notices...................................................71
12.4 Benefit of Agreement......................................72
12.5 Syndication or Assignment of Loans........................72
12.6 No Waiver; Remedies Cumulative............................73
12.7 Payments Pro Rata.........................................73
12.8 Calculations; Computations................................74
12.9 Governing Law; Submission to Jurisdiction;
Venue.....................................................74
12.10 Obligation to Make Payments in Dollars....................75
12.11 Counterparts..............................................75
12.12 Intercreditor Provisions..................................75
12.13 Headings Descriptive......................................76
12.14 Amendment or Waiver.......................................76
12.15 Survival..................................................77
12.16 Domicile of Loans.........................................77
12.17 WAIVER OF JURY TRIAL......................................77
TABLE OF CONTENTS
(continued)
Schedule I........Commitments
Schedule II.......Lending Offices
Schedule III......Indebtedness to be Paid
Schedule IV.......Secured Indebtedness/Liens
Schedule V........Transactions with Affiliates
Exhibit A Form of Notice of Borrowing
Exhibit B-1 Form of Base Rate Tranche A Term Note
Exhibit B-2 Form of LIBOR Tranche A Term Note
Exhibit B-3 Form of Base Rate Tranche A Revolving Note
Exhibit B-4 Form of LIBOR Tranche A Revolving Note
Exhibit B-5 Form of Base Rate Tranche B Term Note
Exhibit B-6 Form of LIBOR Tranche B Term Note
Exhibit C-1 Form of Officer's Certificate
Exhibit C-2 Form of Secretary's Certificate
Exhibit D-1 Form of Opinion of Cravath, Swaine & Xxxxx LLP, U.S.
counsel to Comercial, Vitrocrisa, Vitro and the US Affiliates
Exhibit D-2 Form of Opinion of General Counsel to Comercial, Vitrocrisa
and Vitro
Exhibit D-3 Form of Opinion of Jauregui, Navarrete, Xxxxx x Xxxxx, S.C.,
Mexican counsel to Comercial, Vitrocrisa and Vitro
Exhibit D-4 Form of Opinion of Xxxxxx & Xxxxxxx LLP, counsel to Libbey and
Libbey Glass
Exhibit D-5 Form of Opinion of Xxxxxxxx & Xxxxxx, special Texas counsel to
Crisa Ltd.
Exhibit D-6 Form of Opinion of Xxxxxxxx, Xxxxxx & Finger, P.A., special
Delaware counsel to Crisa Industrial
Exhibit D-7 Form of Opinion of Lasa Xxxxxxx & Veve, special District of
Columbia counsel to Comercial
Exhibit E Form of Process Agent Letter
Exhibit F Form of Assignment and Assumption Agreement
Exhibit G Form of Accounts Receivable Report
Exhibit H Form of Subsidiary Guaranty
Exhibit I Form of Intercompany Note
Exhibit J Form of Libbey Guaranty
Exhibit K Form of Vitro Guaranty
Exhibit L Form of Security Agreement
Exhibit M Form of Consent
Exhibit N Form of US Affiliate Guaranty
Exhibit O Form of US Affiliate Security Agreement
Exhibit P Form of Non-Possessory Pledge Agreement
Exhibit Q Form of Accelerated Product Payment Agreement
Exhibit R Form of Compliance Certificate
