Exhibit 99.1
CREDIT AGREEMENT
by and among
XXXXX CORPORATION
and
THE BANKS PARTY HERETO
and
PNC BANK, NATIONAL ASSOCIATION, As Agent
Dated as of December 20, 2001
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
SCHEDULE 1.1(A) - PRICING GRID
SCHEDULE 1.1(B) - REVOLVING CREDIT COMMITMENTS OF BANKS AND ADDRESSES
FOR NOTICES
SCHEDULE 1.1(P) - PERMITTED LIENS
SCHEDULE 1.1(Q) - QUALIFIED INVENTORY
SCHEDULE 5.1.1 - QUALIFICATIONS TO DO BUSINESS
SCHEDULE 5.1.2 - CAPITALIZATION
SCHEDULE 5.1.3 - SUBSIDIARIES
SCHEDULE 5.1.7 - LITIGATION
SCHEDULE 5.1.8 - OWNED AND LEASED REAL PROPERTY
SCHEDULE 5.1.13 - CONSENTS AND APPROVALS
SCHEDULE 5.1.15 - PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, ETC.
SCHEDULE 5.1.17 - PARTNERSHIP AGREEMENTS; LLC AGREEMENTS
SCHEDULE 5.1.18 - INSURANCE POLICIES
SCHEDULE 5.1.20 - MATERIAL CONTRACTS
SCHEDULE 5.1.22 - EMPLOYEE BENEFIT PLAN DISCLOSURES
SCHEDULE 5.1.24 - ENVIRONMENTAL DISCLOSURES
SCHEDULE 7.2.1 - EXISTING INDEBTEDNESS, LETTERS OF CREDIT AND
CAPITALIZED LEASES
EXHIBITS
EXHIBIT 1.1(A) - ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 1.1(B) - BANK JOINDER
EXHIBIT 1.1(G)(1) - GUARANTOR JOINDER
EXHIBIT 1.1(G)(2) - GUARANTY AGREEMENT
EXHIBIT 1.1(I) - INTERCOMPANY SUBORDINATION AGREEMENT
EXHIBIT 1.1(P)(1) - THE PATENT, TRADEMARK AND COPYRIGHT ASSIGNMENT
EXHIBIT 1.1(P)(2) - PLEDGE AGREEMENT
EXHIBIT 1.1(R) - REVOLVING CREDIT NOTE
EXHIBIT 1.1(S)(1) - SECURITY AGREEMENT
EXHIBIT 1.1(S)(2) - Swing LOAN NOTE
EXHIBIT 2.4.1 - REVOLVING CREDIT LOAN REQUEST
EXHIBIT 2.4.2 - Swing LOAN REQUEST
EXHIBIT 6.1.4 - OPINION OF COUNSEL
EXHIBIT 6.1.15 - LANDLORD'S WAIVER
EXHIBIT 7.3.3 - QUARTERLY COMPLIANCE CERTIFICATE
EXHIBIT 7.3.4 - BORROWING BASE CERTIFICATE
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is dated as of December 20, 2001 and is made by
and among XXXXX CORPORATION, a Delaware corporation (the "Borrower"), each of
the Guarantors (as hereinafter defined), the BANKS (as hereinafter defined), and
PNC BANK, NATIONAL ASSOCIATION, in its capacity as agent for the Banks under
this Agreement (hereinafter referred to in such capacity as the "Agent").
WITNESSETH:
WHEREAS, the Borrower has requested the Banks to provide a revolving
credit facility to the Borrower in an aggregate initial principal amount of
$10,000,000 with a right to increase such principal amount to $30,000,000; and
WHEREAS, the revolving credit facility shall be used for general
corporate purposes including working capital needs and capital expenditures; and
WHEREAS, the Banks are willing to provide such credit upon the terms
and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS
1.1 CERTAIN DEFINITIONS.
In addition to words and terms defined elsewhere in this Agreement,
the following words and terms shall have the following meanings, respectively,
unless the context hereof clearly requires otherwise:
ADDITIONAL BANK shall have the meaning assigned to such term
in Section 2.9.
AFFILIATE as to any Person shall mean any other Person (i)
which directly or indirectly controls, is controlled by, or is under common
control with such Person, (ii) which beneficially owns or holds 5% or more of
any class of the voting or other equity interests of such Person, or (iii) 5% or
more of any class of voting interests or other equity interests of which is
beneficially owned or held, directly or indirectly, by such Person. Control, as
used in this definition, shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting
securities, by contract or otherwise, including the power to elect a majority of
the directors or trustees of a corporation or trust, as the case may be.
AGENT shall mean PNC Bank, National Association, and its
successors and assigns.
AGENT'S FEE shall have the meaning assigned to that term in
Section 9.15.
AGENT'S LETTER shall have the meaning assigned to that term in
Section 9.15.
AGREEMENT shall mean this Credit Agreement, as the same may be
supplemented or amended from time to time, including all schedules and exhibits.
ANNUAL STATEMENTS shall have the meaning assigned to that term
in Section 5.1.9(i).
APPLICABLE REVOLVING CREDIT COMMITMENT FEE RATE shall mean the
percentage rate per annum based on the Leverage Ratio then in effect according
to the pricing grid on SCHEDULE 1.1(A) below the heading "Revolving Credit
Commitment Fee." The Applicable Revolving Credit Commitment Fee Rate shall be
computed in accordance with the parameters set forth on Schedule 1.1(A).
APPLICABLE MARGIN shall mean the percentage spread to be added
to Euro-Rate under the Euro-Rate Option based on the Leverage Ratio then in
effect according to the pricing grid on SCHEDULE 1.1(A) below the heading
"Euro-Rate Spread". The Applicable Margin shall be computed in accordance with
the parameters set forth on Schedule 1.1(A).
ASSIGNMENT AND ASSUMPTION AGREEMENT shall mean an Assignment
and Assumption Agreement by and among an assignee Bank, an assignor Bank and the
Agent, as Agent and on behalf of the remaining Banks, substantially in the form
of EXHIBIT 1.1(A).
AUTHORIZED OFFICER shall mean those individuals, designated by
written notice to the Agent from the Borrower, authorized to execute notices,
reports and other documents on behalf of the Loan Parties required hereunder.
The Borrower may amend such list of individuals from time to time by giving
written notice of such amendment to the Agent.
BANK JOINDER shall mean a joinder after the date hereof by a
Bank under this Agreement and the other Loan Documents in the form of EXHIBIT
1.1(B).
BANK-PROVIDED INTEREST RATE HEDGE shall mean an Interest Rate
Hedge which is provided by any Bank and with respect to which the Agent confirms
meets the following requirements: such Interest Rate Hedge (i) is documented in
a standard International Swap Dealer Association Agreement, (ii) provides for
the method of calculating the reimbursable amount of the provider's credit
exposure in a reasonable and customary manner, and (iii) is
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entered into for hedging (rather than speculative) purposes. The liabilities of
the Loan Parties to the provider of any Bank-Provided Interest Rate Hedge (the
"Hedge Liabilities") shall be "Obligations" hereunder, guaranteed obligations
under the Guaranty Agreement and secured obligations under the Security
Agreement and otherwise treated as Obligations for purposes of each of the other
Loan Documents. The Liens securing the Hedge Liabilities shall be pari passu
with the Liens securing all other Obligations under this Agreement and the other
Loan Documents.
BANKS shall mean the financial institutions named on SCHEDULE
1.1(B) and their respective successors and assigns as permitted hereunder, each
of which is referred to herein as a Bank.
BASE RATE shall mean the greater of (i) the interest rate per
annum announced from time to time by the Agent at its Principal Office as its
then prime rate, which rate may not be the lowest rate then being charged
commercial borrowers by the Agent, or (ii) the Federal Funds Effective Rate plus
1/2%per annum.
BASE RATE OPTION shall mean the option of the Borrower to have
Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 3.1.1(i).
BASE TANGIBLE NET WORTH shall mean, as of any date of
determination, the sum of $210,000,000 (representing approximately 90% of the
Consolidated Tangible Net Worth of the Borrower and its Subsidiaries as of
September 30, 2001), plus the sum of the following amounts earned or received
from September 30, 2001 through the last day of each fiscal quarter after
September 30, 2001: (i) 50% of consolidated net income of the Borrower and its
Subsidiaries for each fiscal quarter in which net income was earned (as opposed
to a net loss) plus (ii) 50% of the proceeds received by Borrower from any sale
by Borrower of capital stock of the Borrower after deducting expenses incurred
in connection with such sale.
BENEFIT ARRANGEMENT shall mean at any time an "employee
benefit plan," within the meaning of Section 3(3) of ERISA, which is neither a
Plan nor a Multiemployer Plan and which is maintained, sponsored or otherwise
contributed to by any member of the ERISA Group.
XXXXX FACTORING COMPANY shall mean Xxxxx Factoring Company, a
Delaware corporation, which purchases the accounts of the Borrower and sells
such accounts to Market Street Funding Corporation under the Trade Receivables
Securitization.
BORROWER shall mean Xxxxx Corporation, a corporation organized
and existing under the laws of the State of Delaware.
BORROWING BASE shall mean at any time 40% of Qualified
Inventory. Notwithstanding anything to the contrary herein, the Required Banks
may, in their reasonable
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discretion based on customary or industry standards, at any time hereafter,
increase or decrease the advance percentage for Qualified Inventory, or increase
the level of any reserves or ineligibles, or define or maintain such other
reserves or ineligibles, as the Required Banks may deem necessary or
appropriate. Any such change shall become effective immediately upon written
notice from the Agent to the Borrower for the purpose of calculating the
Borrowing Base hereunder.
BORROWING DATE shall mean, with respect to any Loan, the date
for the making thereof or the renewal or conversion thereof at or to the same or
a different Interest Rate Option, which shall be a Business Day.
BORROWING TRANCHE shall mean specified portions of Loans
outstanding as follows: (i) any Revolving Credit Loans to which a Euro-Rate
Option applies which become subject to the same Interest Rate Option under the
same Revolving Credit Loan Request by the Borrower and which have the same
Revolving Credit Interest Period shall constitute one Borrowing Tranche, (ii)
any Swing Loans which have the same Swing Loan Interest Period shall constitute
one Borrowing Tranche, and (iii) all Revolving Credit Loans to which a Base Rate
Option applies shall constitute one Borrowing Tranche.
BUSINESS DAY shall mean any day other than a Saturday or
Sunday or a legal holiday on which commercial banks are authorized or required
to be closed for business in Pittsburgh, Pennsylvania and if the applicable
Business Day relates to any Revolving Credit Loan to which the Euro-Rate Option
applies, such day must also be a day on which dealings are carried on in the
London interbank market.
CLOSING DATE shall mean the Business Day on which the first
Loan shall be made, which shall be December 20, 2001.
COLLATERAL shall mean the UCC Collateral and the Pledged
Collateral.
COMMITMENT shall mean as to any Bank its Revolving Credit
Commitment and, in the case of the Agent, its Swing Loan Commitment, and
COMMITMENTS shall mean the Revolving Credit Commitments and the Swing Loan
Commitment of all of the Banks and the Agent.
COMPLIANCE CERTIFICATE shall have the meaning assigned to such
term in Section 7.3.3.
CONSOLIDATED TANGIBLE NET WORTH shall mean as of any date of
determination total stockholders' equity less intangible assets of the Borrower
and its Subsidiaries as of such date determined and consolidated in accordance
with GAAP.
CONTAMINATION shall mean the presence or release or threat of
release of Regulated Substances in, on, under or emanating to or from the
Property, which pursuant to Environmental Laws requires notification or
reporting to an Official Body, or which pursuant to
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Environmental Laws requires the investigation, cleanup, removal, remediation,
containment, abatement of or other response action or which otherwise
constitutes a violation of Environmental Laws.
DOLLAR, DOLLARS, U.S. DOLLARS and the symbol $ shall mean
lawful money of the United States of America.
DRAWING DATE shall have the meaning assigned to that term in
Section 2.10.3.2.
EBIT shall mean as of any date of determination (i) the sum of
net income, interest expense and income tax expense minus (ii) non-cash credits
to net income, in each case of the Borrower and its Subsidiaries as of such date
determined and consolidated in accordance with GAAP.
EBITDA for any period of determination shall mean (i) the sum
of net income, depreciation, amortization, interest expense and income tax
expense minus (ii) non-cash credits to net income, in each case of the Borrower
and its Subsidiaries for such period determined and consolidated in accordance
with GAAP.
ENVIRONMENTAL COMPLAINT shall mean any written complaint by
any Person or Official Body setting forth a cause of action for personal injury
or property damage, natural resource damage, contribution or indemnity for
response costs, civil or administrative penalties, criminal fines or penalties,
or declaratory or equitable relief arising under any Environmental Laws or any
order, notice of violation, citation, subpoena, request for information or other
written notice or demand of any type issued by an Official Body pursuant to any
Environmental Laws.
ENVIRONMENTAL LAWS shall mean all federal, state, local and
foreign Laws and any consent decrees, settlement agreements, judgments, orders,
directives, policies or programs issued by or entered into with an Official Body
pertaining or relating to: (i) pollution or pollution control; (ii) protection
of human health or the environment; (iii) employee safety in the workplace; (iv)
the presence, use, management, generation, manufacture, processing, extraction,
treatment, recycling, refining, reclamation, labeling, transport, storage,
collection, distribution, disposal or release or threat of release of Regulated
Substances; (v) the presence of Contamination; (vi) the protection of endangered
or threatened species; and (vii) the protection of Environmentally Sensitive
Areas.
ENVIRONMENTALLY SENSITIVE AREA shall mean (i) any wetland as
defined by applicable Environmental Laws; (ii) any area designated as a coastal
zone pursuant to applicable Laws, including Environmental Laws; (iii) any area
of historic or archeological significance or scenic area as defined or
designated by applicable Laws, including Environmental Laws; (iv) habitats of
endangered species or threatened species as designated by applicable Laws,
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including Environmental Laws; or (v) a floodplain or other flood hazard area as
defined pursuant to any applicable Laws.
ERISA shall mean the Employee Retirement Income Security Act
of 1974, as the same may be amended or supplemented from time to time, and any
successor statute of similar import, and the rules and regulations thereunder,
as from time to time in effect.
ERISA GROUP shall mean, at any time, the Borrower and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control and all other entities which,
together with the Borrower, are treated as a single employer under Section 414
of the Internal Revenue Code.
EURO-RATE shall mean, with respect to the Revolving Credit
Loans comprising any Borrowing Tranche to which the Euro-Rate Option applies for
any Revolving Credit Interest Period, the interest rate per annum determined by
the Agent by dividing (the resulting quotient rounded upwards, if necessary, to
the nearest 1/100th of 1% per annum) (i) the rate of interest determined by the
Agent in accordance with its usual procedures (which determination shall be
conclusive absent manifest error) to be the average of the London interbank
offered rates for U.S. Dollars quoted by the British Bankers' Association as set
forth on Dow Xxxxx Markets Service (formerly known as Telerate) (or appropriate
successor or, if the British Bankers' Association or its successor ceases to
provide such quotes, a comparable replacement determined by the Agent) display
page 3750 (or such other display page on the Dow Xxxxx Markets Service system as
may replace display page 3750) two (2) Business Days prior to the first day of
such Revolving Credit Interest Period for an amount comparable to such Borrowing
Tranche and having a borrowing date and a maturity comparable to such Revolving
Credit Interest Period by (ii) a number equal to 1.00 minus the Euro-Rate
Reserve Percentage. The Euro-Rate may also be expressed by the following
formula:
Average of London interbank offered rates quoted
by BBA or appropriate successor as shown on
Euro-Rate = Dow Xxxxx Markets Service Display page 3750
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1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Revolving Credit Loan to
which the Euro-Rate Option applies that is outstanding on the effective date of
any change in the Euro-Rate Reserve Percentage as of such effective date. The
Agent shall give prompt notice to the Borrower of the Euro-Rate as determined or
adjusted in accordance herewith, which determination shall be conclusive absent
manifest error.
EURO-RATE OPTION shall mean the option of the Borrower to have
Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 3.1.1(ii).
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EURO-RATE RESERVE PERCENTAGE shall mean as of any day the
maximum percentage in effect on such day, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
reserve requirements (including supplemental, marginal and emergency reserve
requirements) with respect to eurocurrency funding (currently referred to as
"Eurocurrency Liabilities").
EVENT OF DEFAULT shall mean any of the events described in
Section 8.1 and referred to therein as an "Event of Default."
Excluded Assets shall have the meaning assigned to such term
in the definition of Security Agreement.
EXCLUDED SUBSIDIARIES shall mean the Foreign Subsidiaries,
Xxxxx Factoring Company JLB Service Bank, and the Xxxx Xxxxxxx Joint Venture.
EXPIRATION DATE shall mean, with respect to the Commitments,
December 20, 2004.
FEDERAL FUNDS EFFECTIVE RATE for any day shall mean the rate
per annum (based on a year of 360 days and actual days elapsed and rounded
upward to the nearest 1/100 of 1%) announced by the Federal Reserve Bank of New
York (or any successor) on such day as being the weighted average of the rates
on overnight federal funds transactions arranged by federal funds brokers on the
previous trading day, as computed and announced by such Federal Reserve Bank (or
any successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; PROVIDED, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.
FINANCIAL PROJECTIONS shall have the meaning assigned to that
term in Section 5.1.9(ii).
FIRST UNION FACILITY shall mean that certain letter of credit
facility provided by First Union National Bank pursuant to letter agreements
between Borrower and First Union most recently extended by letter agreement
dated as of November 9, 2001, and modified by letter agreement dated the date
hereof.
FIXED CHARGE COVERAGE RATIO shall mean as of the end of any
quarter, for the four quarters then ended, the ratio of Borrower's EBITDA to
Fixed Charges.
FIXED CHARGES shall mean the sum of interest expense
(including borrowing, interest capital or equivalent costs under the Trade
Receivables Securitization) scheduled principal payments on Indebtedness,
scheduled payments under capital leases, dividends and distributions to
shareholders of the Borrower and capital expenditures (excluding
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capital expenditures of up to $24,000,000 associated with the Borrower's
expansion of its distribution facility incurred between the Closing Date and
December 31, 2003.
FOREIGN SUBSIDIARY shall mean a Subsidiary of the Borrower or
another Loan Party which is organized under the Laws of a country or
jurisdiction other than the United States of America or any state or
commonwealth thereof.
GAAP shall mean generally accepted accounting principles as
are in effect from time to time, subject to the provisions of Section 1.3, and
applied on a consistent basis both as to classification of items and amounts.
GOVERNMENTAL ACTS shall have the meaning assigned to that term
in Section 2.10.8.
GUARANTOR shall mean each of the parties to this Agreement
which is designated as a "Guarantor" on the signature page hereof and each other
Person which joins this Agreement as a Guarantor after the date hereof pursuant
to Section 10.19. The Excluded Subsidiaries shall not be Guarantors hereunder.
GUARANTOR JOINDER shall mean a joinder by a Person as a
Guarantor under this Agreement, the Guaranty Agreement and the other Loan
Documents in the form of EXHIBIT 1.1(G)(1).
GUARANTY of any Person shall mean any obligation of such
Person guaranteeing or in effect guaranteeing any liability or obligation of any
other Person in any manner, whether directly or indirectly, including any
agreement to indemnify or hold harmless any other Person, any performance bond
or other suretyship arrangement and any other form of assurance against loss,
except endorsement of negotiable or other instruments for deposit or collection
in the ordinary course of business.
GUARANTY AGREEMENT shall mean the Guaranty and Suretyship
Agreement in substantially the form of EXHIBIT 1.1(G)(2) executed and delivered
by each of the Guarantors to the Agent for the benefit of the Banks.
HISTORICAL STATEMENTS shall have the meaning assigned to that
term in Section 5.1.9(i).
INDEBTEDNESS shall mean, as to any Person at any time, any and
all indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (i) borrowed money including
any outstanding capital or other liabilities under the Trade Receivables
Securitization, (ii) amounts raised under or liabilities in respect of any note
purchase or acceptance credit facility, (iii) reimbursement obligations
(contingent or otherwise) under any letter of credit, currency swap agreement,
interest rate swap, cap, collar or floor agreement or other interest rate
management device, (iv) any other transaction (including forward
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sale or purchase agreements, capitalized leases and conditional sales
agreements) having the commercial effect of a borrowing of money entered into by
such Person to finance its operations or capital requirements (but not including
trade and customer payables and accrued expenses incurred in the ordinary course
of business which are not represented by a promissory note or other evidence of
indebtedness and which are not more than thirty (30) days past due), or (v) any
Guaranty of Indebtedness for borrowed money.
INELIGIBLE SECURITY shall mean any security which may not be
underwritten or dealt in by member banks of the Federal Reserve System under
Section 16 of the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as
amended.
INSOLVENCY PROCEEDING shall mean, with respect to any Person,
(a) a case, action or proceeding with respect to such Person (i) before any
court or any other Official Body under any bankruptcy, insolvency,
reorganization or other similar Law now or hereafter in effect, or (ii) for the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator, conservator (or similar official) of any Loan Party or otherwise
relating to the liquidation, dissolution, winding-up or relief of such Person,
or (b) any general assignment for the benefit of creditors, composition,
marshaling of assets for creditors, or other, similar arrangement in respect of
such Person's creditors generally or any substantial portion of its creditors;
undertaken under any Law.
INTERCOMPANY SUBORDINATION AGREEMENT shall mean a
Subordination Agreement among the Loan Parties in the form attached hereto as
EXHIBIT 1.1(I).
INTEREST PERIOD shall mean either the Revolving Credit
Interest Period or Swing Loan Interest Period, as applicable.
INTEREST RATE HEDGE shall mean an interest rate exchange,
collar, cap, swap, adjustable strike cap, adjustable strike corridor or similar
agreements entered into by the Loan Parties or their Subsidiaries in order to
provide protection to, or minimize the impact upon, the Borrower, the Guarantor
and/or their Subsidiaries of increasing floating rates of interest applicable to
Indebtedness.
INTEREST RATE OPTION shall mean any Euro-Rate Option or Base
Rate Option.
INTERIM STATEMENTS shall have the meaning assigned to that
term in Section 5.1.9(i).
INTERNAL REVENUE CODE shall mean the Internal Revenue Code of
1986, as the same may be amended or supplemented from time to time, and any
successor statute of similar import, and the rules and regulations thereunder,
as from time to time in effect.
INVESTMENT shall mean with respect to any Person, (i) loans
made, directly or indirectly, by the Loan Parties in such Person, (ii) capital
or other equity contributions or
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investments made, directly or indirectly, by the Loan Parties to such Person,
(iii) Guaranties made by the Loan Parties, directly or indirectly, to or for the
benefit of such Person, or (iv) any other consideration, benefit or investment
made or give to or for the benefit of such Person.
XXXX XXXXXXX JOINT VENTURE shall mean a Delaware limited
liability company which is initially owned 90% by the Borrower and 10% by an
Affiliate of Xxxx Xxxxxxx, which shall engage in the business of designing,
developing, manufacturing (or causing to be manufactured) and distributing
certain lifestyle products bearing the "Xxxx Xxxxxxx" brand name, image or
likeness.
JLB SERVICE BANK shall mean JLB Service Bank, a Delaware
banking association which shall engage in issuing credit cards to customers of
the Borrower permitted to a CEBA credit card bank under Federal law.
LABOR CONTRACTS shall mean all employment agreements,
employment contracts, collective bargaining agreements and other agreements
among any Loan Party or Subsidiary of a Loan Party and its employees.
LAW shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, opinion, release, ruling, order,
injunction, writ, decree, bond, judgment, authorization or approval, lien or
award of or settlement agreement with any Official Body.
LETTER OF CREDIT shall have the meaning assigned to that term
in Section 2.10.1.
LETTER OF CREDIT BORROWING shall have the meaning assigned to
such term in Section 2.10.3.4.
LETTER OF CREDIT FEE shall have the meaning assigned to that
term in Section 2.10.2.
LETTERS OF CREDIT OUTSTANDING shall mean at any time the sum
of (i) the aggregate undrawn face amount of outstanding Letters of Credit and
(ii) the aggregate amount of all unpaid and outstanding Reimbursement
Obligations and Letter of Credit Borrowings.
LEVERAGE RATIO shall mean as of any date of determination the
ratio of consolidated Indebtedness of Borrower and its Subsidiaries on such date
to the EBITDA for the four prior fiscal quarters ending on such date or
immediately before such date if such date is not a quarter end.
LIEN shall mean any mortgage, deed of trust, pledge, lien,
security interest, charge or other encumbrance or security arrangement of any
nature whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security
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and any filed financing statement or other notice of any of the foregoing
(whether or not a lien or other encumbrance is created or exists at the time of
the filing).
LLC INTERESTS shall have the meaning given to such term in
Section 5.1.3.
LOAN DOCUMENTS shall mean this Agreement, the Agent's Letter,
the Guaranty Agreement, the Intercompany Subordination Agreement, the Notes, the
Patent, Trademark and Copyright Assignment, the Pledge Agreement and the
Security Agreement, and any other instruments, certificates or documents
delivered or contemplated to be delivered hereunder or thereunder or in
connection herewith or therewith, as the same may be supplemented or amended
from time to time in accordance herewith or therewith, and LOAN DOCUMENT shall
mean any of the Loan Documents.
LOAN PARTIES shall mean the Borrower and the Guarantors.
LOAN REQUEST shall mean either a Revolving Credit Loan Request
or Swing Loan Request, as applicable.
LOANS shall mean collectively and LOAN shall mean separately
all Revolving Credit Loans or Swing Loans, or any Revolving Credit Loan or Swing
Loan.
MATERIAL ADVERSE CHANGE shall mean any set of circumstances or
events which (a) has or could reasonably be expected to have any material
adverse effect whatsoever upon the validity or enforceability of this Agreement
or any other Loan Document, (b) is or could reasonably be expected to be
material and adverse to the business, properties, assets, financial condition,
results of operations or prospects of the Loan Parties taken as a whole, (c)
impairs materially or could reasonably be expected to impair materially the
ability of the Loan Parties taken as a whole to duly and punctually pay or
perform its material Indebtedness, or (d) impairs materially or could reasonably
be expected to impair materially the ability of the Agent or any of the Banks,
to the extent permitted, to enforce their legal remedies pursuant to this
Agreement or any other Loan Document.
MONTH, with respect to an Revolving Credit Interest Period
under the Euro-Rate Option, shall mean the interval between the days in
consecutive calendar months numerically corresponding to the first day of such
Revolving Credit Interest Period. If any Euro-Rate Revolving Credit Interest
Period begins on a day of a calendar month for which there is no numerically
corresponding day in the month in which such Revolving Credit Interest Period is
to end, the final month of such Revolving Credit Interest Period shall be deemed
to end on the last Business Day of such final month.
MULTIEMPLOYER PLAN shall mean any employee benefit plan which
is a "multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and
to which the Borrower or any member of the ERISA Group is then making or
accruing an obligation to make
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contributions or, within the preceding five Plan years, has made or had an
obligation to make such contributions.
MULTIPLE EMPLOYER PLAN shall mean a Plan which has two or more
contributing sponsors (including the Borrower or any member of the ERISA Group)
at least two of whom are not under common control, as such a plan is described
in Sections 4063 and 4064 of ERISA.
1998 CREDIT FACILITY shall mean the Amended And Restated
Credit Agreement, dated as of November 13, 1998, as amended, among PNC Bank, as
agent, the Borrower and the banks parties thereto.
NOTES shall mean the Revolving Credit Notes and Swing Note.
NOTICES shall have the meaning assigned to that term in
Section 10.6.
OBLIGATION shall mean any obligation or liability of any of
the Loan Parties to the Agent or any of the Banks, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due, under or in connection with this Agreement,
the Agent's Letter, the Notes, the Letters of Credit, or any other Loan
Document. Obligations shall include the liabilities to any Bank under any
Bank-Provided Interest Rate Hedge but shall not include the liabilities to other
Persons under any other Interest Rate Hedge.
OFFERED RATE OPTION shall mean the rate of interest quoted
from time to time by PNC Bank to the Borrower and accepted by the Borrower with
respect to a Swing Loan.
OFFICIAL BODY shall mean any national, federal, state, local
or other government or political subdivision or any agency, authority, board,
bureau, central bank, commission, department or instrumentality of either, or
any court, tribunal, grand jury or arbitrator, in each case whether foreign or
domestic.
PARTICIPATION ADVANCE shall mean, with respect to any Bank,
such Bank's payment in respect of its participation in a Letter of Credit
Borrowing according to its Ratable Share pursuant to Section 2.10.3.4.
PARTNERSHIP INTERESTS shall have the meaning given to such
term in Section 5.1.3.
PATENT, TRADEMARK AND COPYRIGHT ASSIGNMENT shall mean the
Patent, Trademark and Copyright Collateral Assignment in substantially the form
of EXHIBIT 1.1(P)(1) executed and delivered by each of the Loan Parties to the
Agent for the benefit of the Banks.
PBGC shall mean the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA or any successor.
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PERMITTED INVESTMENTS shall mean:
(i) direct obligations of the United States of America or
any agency or instrumentality thereof or obligations backed by the full faith
and credit of the United States of America maturing in twelve (12) months or
less from the date of acquisition;
(ii) commercial paper maturing in 180 days or less rated
not lower than A-1, by Standard & Poor's or P-1 by Xxxxx'x Investors Service,
Inc. on the date of acquisition;
(iii) demand deposits, time deposits or certificates of
deposit maturing within one year in commercial banks whose obligations are rated
A-1, A or the equivalent or better by Standard & Poor's on the date of
acquisition; and.
(iv) funds investing exclusively in the investments
described in clauses (i) through (iii) above.
PERMITTED LIENS shall mean:
(i) Liens for taxes, assessments, or similar charges,
incurred in the ordinary course of business and which are not yet due and
payable;
(ii) Pledges or deposits made in the ordinary course of
business to secure payment of workmen's compensation, or to participate in any
fund in connection with workmen's compensation, unemployment insurance, old-age
pensions or other social security programs;
(iii) Liens of mechanics, materialmen, warehousemen,
carriers, or other like Liens, securing obligations incurred in the ordinary
course of business that are not yet due and payable and Liens of landlords
securing obligations to pay lease payments that are not yet due and payable or
in default;
(iv) Good-faith pledges or deposits made in the ordinary
course of business to secure performance of bids, tenders, contracts (other than
for the repayment of borrowed money) or leases, not in excess of the aggregate
amount due thereunder, or to secure statutory obligations, or surety, appeal,
indemnity, performance or other similar bonds required in the ordinary course of
business;
(v) Encumbrances consisting of zoning restrictions,
easements or other restrictions on the use of real property, none of which
materially impairs the use of such property or the value thereof, and none of
which is violated in any material respect by existing or proposed structures or
land use;
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(vi) Liens, security interests and mortgages in favor of
the Agent for the benefit of the Banks securing the Obligations including
liabilities under any Bank-Provided Interest Rate Hedge;
(vii) Liens on property leased by any Loan Party or
Subsidiary of a Loan Party under capital and operating leases permitted in
Section 7.2.14 securing obligations of such Loan Party or Subsidiary to the
lessor under such leases;
(viii) Any Lien existing on the date of this Agreement
and described on SCHEDULE 1.1(P), PROVIDED that the principal amount secured
thereby is not hereafter increased, and no additional assets become subject to
such Lien;
(ix) Liens on assets excluded from the Collateral under
the Security Agreement granted or to be granted by Borrower to Xxxxx Factoring
Company, or by Xxxxx Factoring Company to the administrator for the conduit
purchasers, pursuant to or in connection with the Trade Receivables
Securitization; and
(x) The following, (A) if the validity or amount thereof
is being contested in good faith by appropriate and lawful proceedings
diligently conducted so long as levy and execution thereon have been stayed and
continue to be stayed or (B) if a final judgment is entered and such judgment is
discharged within thirty (30) days of entry, and in either case they do not
affect the Collateral or, in the aggregate, materially impair the ability of any
Loan Party to perform its Obligations hereunder or under the other Loan
Documents:
(1) Claims or Liens for taxes, assessments or charges due and
payable and subject to interest or penalty, PROVIDED that the
applicable Loan Party maintains such reserves or other appropriate
provisions as shall be required by GAAP and pays all such taxes,
assessments or charges forthwith upon the commencement of proceedings
to foreclose any such Lien;
(2) Claims, Liens or encumbrances upon, and defects of title
to, real or personal property other than the Collateral, including any
attachment of personal or real property or other legal process prior to
adjudication of a dispute on the merits;
(3) Claims or Liens of mechanics, materialmen, warehousemen,
carriers, or other statutory nonconsensual Liens; or
(4) Liens resulting from final judgments or orders described
in Section 8.1.6.
PERSON shall mean any individual, corporation, partnership,
limited liability company, association, joint-stock company, trust,
unincorporated organization, joint venture, government or political subdivision
or agency thereof, or any other entity.
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PLAN shall mean at any time an employee pension benefit plan
(including a Multiple Employer Plan, but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject to the minimum funding standards
under Section 412 of the Internal Revenue Code and either (i) is maintained by
any member of the ERISA Group for employees of any member of the ERISA Group or
(ii) has at any time within the preceding five years been maintained by any
entity which was at such time a member of the ERISA Group for employees of any
entity which was at such time a member of the ERISA Group.
PLEDGE AGREEMENT shall mean the Pledge Agreement in
substantially the form of EXHIBIT 1.1(P)(2) executed and delivered by the Loan
Parties to the Agent for the benefit of the Banks.
PLEDGED COLLATERAL shall mean the property of the Loan Parties
in which security interests are to be granted under the Pledge Agreement, which
shall include the ownership interests in each of the Subsidiaries of the
Borrower including the Borrower's interest in the Xxxx Xxxxxxx Joint Venture and
Xxxxx Factoring but excluding JLB Service Bank and the Foreign Subsidiaries
PNC BANK shall mean PNC Bank, National Association, its
successors and assigns.
POTENTIAL DEFAULT shall mean any event or condition which with
notice, passage of time or a determination by the Agent or the Required Banks,
or any combination of the foregoing, would constitute an Event of Default.
PRINCIPAL OFFICE shall mean the main banking office of the
Agent in Pittsburgh, Pennsylvania.
PRIOR SECURITY INTEREST shall mean a valid and enforceable
perfected first-priority security interest under the Uniform Commercial Code in
the UCC Collateral and the Pledged Collateral which is subject only to Liens for
taxes not yet due and payable to the extent such prospective tax payments are
given priority by statute.
PROHIBITED TRANSACTION shall mean any prohibited transaction
as defined in Section 4975 of the Internal Revenue Code or Section 406 of ERISA
for which neither an individual nor a class exemption has been issued by the
United States Department of Labor.
PROPERTY shall mean all real property, both owned and leased,
of any Loan Party or Subsidiary of a Loan Party.
QUALIFIED INVENTORY shall mean any Inventory which the Agent
in its sole discretion determines to have met all of the minimum requirements
set forth on SCHEDULE 1.1(Q).
RATABLE SHARE shall mean the proportion that a Bank's
Revolving Credit Commitment bears to the Revolving Credit Commitments of all of
the Banks.
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REGULATED SUBSTANCES shall mean, without limitation, any
substance, material or waste, regardless of its form or nature, defined under
Environmental Laws as a "hazardous substance," "pollutant," "pollution,"
"contaminant," "hazardous or toxic substance," "extremely hazardous substance,"
"toxic chemical," "toxic substance," "toxic waste," "hazardous waste," "special
handling waste," "industrial waste," "residual waste," "solid waste," "municipal
waste," "mixed waste," "infectious waste," "chemotherapeutic waste," "medical
waste," or "regulated substance" or any other material, substance or waste,
regardless of its form or nature, which otherwise is regulated by Environmental
Laws, excepting immaterial quantities of commonly used cleaning and related
products in offices or retail facilities.
REGULATION U shall mean Regulation U, T, G or X as promulgated
by the Board of Governors of the Federal Reserve System, as amended from time to
time.
REIMBURSEMENT OBLIGATION shall have the meaning assigned to
such term in Section 2.10.3.2.
REPORTABLE EVENT shall mean a reportable event described in
Section 4043 of ERISA and regulations thereunder with respect to a Plan or
Multiemployer Plan.
REQUIRED BANKS shall mean
(i) if there are no Loans, Reimbursement Obligations or
Letter of Credit Borrowings outstanding, Banks whose Revolving Credit
Commitments aggregate at least 51% of the Revolving Credit Commitments of all of
the Banks, or
(ii) if there are Loans, Reimbursement Obligations, or
Letter of Credit Borrowings outstanding:
(A) prior to a termination of the Commitments
hereunder pursuant to Section 8.2.1 or 8.2.2, any Bank or group of Banks if the
sum of the, any Bank or group of Banks if the sum of the Revolving Credit Loans,
Reimbursement Obligations and Letter of Credit Borrowings of such Banks then
outstanding aggregates at least 51% of the total principal amount of all of the
Revolving Credit Loans, Reimbursement Obligations and Letter of Credit
Borrowings then outstanding. Reimbursement Obligations and Letter of Credit
Borrowings shall be deemed, for purposes of this definition, to be in favor of
the Agent and not a participating Bank if such Bank has not made its
Participation Advance in respect thereof and shall be deemed to be in favor of
such Bank to the extent of its Participation Advance if it has made its
Participation Advance in respect thereof.
(B) after a termination of the Commitments hereunder
pursuant to Section 8.2.1 or 8.2.2, any Bank or group of Banks if the sum of the
Loans, Reimbursement Obligations and Letter of Credit Borrowings of such Banks
then outstanding aggregates at least 51% of the total principal amount of all of
the Loans, Reimbursement Obligations and Letter of Credit Borrowings then
outstanding.
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REQUIRED ENVIRONMENTAL NOTICES shall mean all notices,
reports, plans, forms or other filings which pursuant to Environmental Laws,
Required Environmental Permits or at the request or direction of an Official
Body either must be submitted to an Official Body or which otherwise must be
maintained.
REQUIRED ENVIRONMENTAL PERMITS shall mean all permits,
licenses, bonds, consents, programs, approvals or authorizations required under
Environmental Laws to own, occupy or maintain the Property or which otherwise
are required for the operations and business activities of the Borrower or
Guarantors.
REVOLVING CREDIT COMMITMENT shall mean, as to any Bank at any
time, the amount initially set forth opposite its name on SCHEDULE 1.1(B) in the
column labeled "Amount of Commitment for Revolving Credit Loans," and REVOLVING
CREDIT COMMITMENTS shall mean the aggregate Revolving Credit Commitments of all
of the Banks.
REVOLVING CREDIT COMMITMENT FEE shall mean the fee referred to
in Section 2.3.
REVOLVING CREDIT INTEREST PERIOD shall mean the period of time
selected by the Borrower in connection with (and to apply to) any election
permitted hereunder by the Borrower to have Revolving Credit Loans bear interest
under the Euro-Rate Option. Subject to the last sentence of this definition,
such period shall be (i) one Month if Borrower selects the Euro-Rate Option
during the Syndications Period and (ii) one, two, three or six Months. Such
Revolving Credit Interest Period shall commence on the effective date of such
Interest Rate Option, which shall be (i) the Borrowing Date if the Borrower is
requesting new Revolving Credit Loans, or (ii) the date of renewal of or
conversion to the Euro-Rate Option if the Borrower is renewing or converting to
the Euro-Rate Option applicable to outstanding Revolving Credit Loans.
Notwithstanding the second sentence hereof: (A) any Revolving Credit Interest
Period which would otherwise end on a date which is not a Business Day shall be
extended to the next succeeding Business Day unless such Business Day falls in
the next calendar month, in which case such Revolving Credit Interest Period
shall end on the next preceding Business Day, and (B) the Borrower shall not
select, convert to or renew an Revolving Credit Interest Period for any portion
of the Revolving Credit Loans that would end after the Expiration Date.
REVOLVING CREDIT LOANS shall mean collectively and Revolving
Credit LOAN shall mean separately all Revolving Credit Loans or any Revolving
Credit Loan made by the Banks or one of the Banks to the Borrower pursuant to
Section 2.1 or 2.10.3.
REVOLVING CREDIT LOAN REQUEST shall have the meaning given to
such term in Section 2.4.1.
REVOLVING CREDIT NOTES shall mean collectively and Revolving
Credit NOTE shall mean separately all the Revolving Credit Notes of the Borrower
in the form of
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EXHIBIT 1.1(R) evidencing the Revolving Credit Loans together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.
REVOLVING FACILITY USAGE shall mean at any time the sum of the
Revolving Credit Loans and Swing Loans outstanding and the Letters of Credit
Outstanding.
SCHEDULE OF INVENTORY shall mean a current schedule of
Inventory in form and substance satisfactory to the Agent, itemizing and
describing the kind, type, quality and quantity of Inventory, as determined by
physical counts taken, the Borrower's costs therefor and selling price thereof,
and the daily withdrawals therefrom and additions thereto.
SCHEDULE OF PAYABLES shall mean a detailed listing of
Borrower's existing accounts payable, specifying the names of each creditor and
the amount owed to such creditor and such matters and information relating to
the status of Borrower's accounts payable so scheduled as the Agent may from
time to time reasonably request.
SECTION 20 SUBSIDIARY shall mean the Subsidiary of the bank
holding company controlling any Bank, which Subsidiary has been granted
authority by the Federal Reserve Board to underwrite and deal in certain
Ineligible Securities.
SECURITY AGREEMENT shall mean the Security Agreement in
substantially the form of EXHIBIT 1.1(S)(1) executed and delivered by each of
the Loan Parties to the Agent for the benefit of the Banks. The collateral under
the Security Agreement shall include inventory, equipment, and all other
tangible personal property of the Loan Parties, including stock of each of the
Loan Parties (except for the Borrower), and all other personal property,
excluding accounts and certain related assets of the Borrower sold to Xxxxx
Factoring Company under or in connection with the Trade Receivables
Securitization as more fully described in such Security Agreement (the "Excluded
Assets").
SETTLEMENT DATE shall mean any Business Day on which the Agent
elects to effect settlement pursuant to Section 4.7.
SHARES shall have the meaning assigned to that term in Section
5.1.2.
SOLVENT shall mean, with respect to any Person on a particular
date, that on such date (i) the fair value of the property of such Person is
greater than the total amount of liabilities, including, without limitation,
contingent liabilities, of such Person, (ii) the present fair saleable value of
the assets of such Person is not less than the amount that will be required to
pay the probable liability of such Person on its debts as they become absolute
and matured, (iii) such Person is able to realize upon its assets and pay its
debts and other liabilities, contingent obligations and other commitments as
they mature in the normal course of business, (iv) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature, and (v) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such
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Person's property would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which such Person is
engaged. In computing the amount of contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount which, in light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability.
STANDARD & POOR'S shall mean Standard & Poor's Ratings
Services, a division of The XxXxxx-Xxxx Companies, Inc.
STANDBY LETTER OF CREDIT shall mean a Letter of Credit issued
to support obligations of one or more of the Loan Parties, contingent or
otherwise, which finance the working capital and business needs of the Loan
Parties incurred in the ordinary course of business, but excluding any Letter of
Credit under which the stated amount of such Letter of Credit increases
automatically over time.
SUBSIDIARY of any Person at any time shall mean (i) any
corporation or trust of which 50% or more (by number of shares or number of
votes) of the outstanding capital stock or shares of beneficial interest
normally entitled to vote for the election of one or more directors or trustees
(regardless of any contingency which does or may suspend or dilute the voting
rights) is at such time owned directly or indirectly by such Person or one or
more of such Person's Subsidiaries, (ii) any partnership of which such Person is
a general partner or of which 50% or more of the partnership interests is at the
time directly or indirectly owned by such Person or one or more of such Person's
Subsidiaries, (iii) any limited liability company of which 50% or more of the
limited liability company interests is at the time directly or indirectly owned
by such Person or one or more of such Person's Subsidiaries or (iv) any
corporation, trust, partnership, limited liability company or other entity which
is controlled or capable of being controlled by such Person or one or more of
such Person's Subsidiaries.
SUBSIDIARY SHARES shall have the meaning assigned to that term
in Section 5.1.3.
SWING LOAN COMMITMENT shall mean PNC Bank's commitment to make
Swing Loans to the Borrower pursuant to Section 2.1.2 hereof in an aggregate
principal amount up to $5,000,000.
Swing Loan Due Date shall have the meaning assigned to that
term in Section 2.5.2.
SWING LOAN INTEREST PERIOD shall mean the period of time
selected by the Borrower in connection with any Swing Loan Request. Such period
shall (i) be no less than one (1) and no more than seven (7) days, (ii) shall
end on a Business Day, and (iii) shall end on or before the Revolving Credit
Expiration Date. Notwithstanding the second sentence hereof, the Borrower shall
not select, convert to or renew an Interest Period for any portion of the Swing
Loans that would end after the Expiration Date.
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SWING LOAN NOTE shall mean the Swing Loan Note of the Borrower
in the form of EXHIBIT 1.1(S)(2) evidencing the Swing Loans, together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.
SWING LOAN REQUEST shall mean a request for Swing Loans made
in accordance with Section 2.4.2 hereof.
SWING LOANS shall mean collectively and SWING LOAN shall mean
separately all Swing Loans or any Swing Loan made by PNC Bank to the Borrower
pursuant to Section 2.1.2 hereof.
SYNDICATIONS PERIOD shall mean the period between the Closing
Date and the earlier of the following dates: (a) the date on which the
Commitments equal or exceed $30,000,000, or (b) the date which is six (6) months
days after the Closing Date.
TRADE LETTER OF CREDIT shall mean a letter of credit issued in
respect of the purchase of goods or services by one or more of the Loan Parties
in the ordinary course of their business.
TRADE RECEIVABLES SECURITIZATION shall mean the sale of the
receivables of the Loan Parties and their Subsidiaries to Xxxxx Factoring
Company and subsequent sale to Market Street Funding Corporation and other
conduit purchasers with a capital balance not to exceed $100,000,000 and any
extensions, amendments or replacements on terms no less favorable than the terms
of such securitization on the Closing Date and approved by the Agent.
TRANSACTION CONSIDERATION shall have the meaning assigned to
such term in Section 7.2.6.
UCC COLLATERAL shall mean the property of the Loan Parties in
which security interests are to be granted under the Patent, Trademark and
Copyright Assignment, the Pledge Agreement and the Security Agreement.
UNIFORM COMMERCIAL CODE shall have the meaning assigned to
that term in Section 5.1.16.
1.2 CONSTRUCTION.
Unless the context of this Agreement otherwise clearly
requires, the following rules of construction shall apply to this Agreement and
each of the other Loan Documents:
1.2.1. NUMBER; INCLUSION.
references to the plural include the singular, the
plural, the part and the whole; "or" has the inclusive meaning represented by
the phrase "and/or," and "including" has the meaning represented by the phrase
"including without limitation";
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1.2.2. DETERMINATION.
references to "determination" of or by the Agent or the
Banks shall be deemed to include good-faith estimates by the Agent or the Banks
(in the case of quantitative determinations) and good-faith beliefs by the Agent
or the Banks (in the case of qualitative determinations) and such determination
shall be conclusive absent manifest error;
1.2.3. AGENT'S DISCRETION AND CONSENT.
whenever the Agent or the Banks are granted the right
herein to act in its or their sole discretion or to grant or withhold consent
such right shall be exercised in good faith;
1.2.4. DOCUMENTS TAKEN AS A WHOLE.
the words "hereof," "herein," "hereunder," "hereto" and
similar terms in this Agreement or any other Loan Document refer to this
Agreement or such other Loan Document as a whole and not to any particular
provision of this Agreement or such other Loan Document;
1.2.5. HEADINGS.
the section and other headings contained in this
Agreement or such other Loan Document and the Table of Contents (if any),
preceding this Agreement or such other Loan Document are for reference purposes
only and shall not control or affect the construction of this Agreement or such
other Loan Document or the interpretation thereof in any respect;
1.2.6. IMPLIED REFERENCES TO THIS AGREEMENT.
article, section, subsection, clause, schedule and
exhibit references are to this Agreement or other Loan Document, as the case may
be, unless otherwise specified;
1.2.7. PERSONS.
reference to any Person includes such Person's
successors and assigns but, if applicable, only if such successors and assigns
are permitted by this Agreement or such other Loan Document, as the case may be,
and reference to a Person in a particular capacity excludes such Person in any
other capacity;
1.2.8. MODIFICATIONS TO DOCUMENTS.
reference to any agreement (including this Agreement
and any other Loan Document together with the schedules and exhibits hereto or
thereto), document or instrument means such agreement, document or instrument as
amended, modified, replaced, substituted for, superseded or restated;
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1.2.9. FROM, TO AND THROUGH.
relative to the determination of any period of time,
"from" means "from and including," "to" means "to but excluding," and "through"
means "through and including"; and
1.2.10. SHALL; WILL.
references to "shall" and "will" are intended to have
the same meaning.
1.3 ACCOUNTING PRINCIPLES.
Except as otherwise provided in this Agreement, all
computations and determinations as to accounting or financial matters and all
financial statements to be delivered pursuant to this Agreement shall be made
and prepared in accordance with GAAP (including principles of consolidation
where appropriate), and all accounting or financial terms shall have the
meanings ascribed to such terms by GAAP; PROVIDED, HOWEVER, that all accounting
terms used in Section 7.2 [Negative Covenants] (and all defined terms used in
the definition of any accounting term used in Section 7.2) shall have the
meaning given to such terms (and defined terms) under GAAP as in effect on the
date hereof applied on a basis consistent with those used in preparing the
Annual Statements referred to in Section 5.1.9(i) [Historical Statements]. In
the event of any change after the date hereof in GAAP, and if such change would
result in the inability to determine compliance with the financial covenants set
forth in Section 7.2 based upon the Borrower's regularly prepared financial
statements by reason of the preceding sentence, then the parties hereto agree to
endeavor, in good faith, to agree upon an amendment to this Agreement that would
adjust such financial covenants in a manner that would not affect the substance
thereof, but would allow compliance therewith to be determined in accordance
with the Borrower's financial statements at that time.
2. REVOLVING CREDIT FACILITY
2.1 COMMITMENTS.
2.1.1. REVOLVING CREDIT COMMITMENT.
Subject to the terms and conditions hereof and relying upon
the representations and warranties herein set forth, each Bank severally agrees
to make Revolving Credit Loans to the Borrower at any time or from time to time
on or after the date hereof to the Expiration Date provided that after giving
effect to such Revolving Credit Loan the aggregate amount of Revolving Credit
Loans from such Bank shall not exceed such Bank's Revolving Credit Commitment
minus such Bank's Ratable Share of the Letters of Credit Outstanding. Within
such limits of time and amount and subject to the other provisions of this
Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section
2.1.
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2.1.2. SWING LOAN COMMITMENT.
Subject to the terms and conditions hereof including Section
2.4.2 and relying upon the representations and warranties herein set forth, and
in order to facilitate loans and repayments between Settlement Dates, PNC Bank
may at its option make swing loans (the "Swing Loans") to the Borrower at any
time or from time to time after the date hereof to, but not including, the
Revolving Credit Expiration Date, in an aggregate principal amount up to but not
in excess of $5,000,000 (the "Swing Loan Commitment"), provided that after
giving effect to such Swing Loans the Revolving Facility Usage shall not exceed
the Revolving Credit Commitments. Within such limits of time and amount and
subject to the other provisions of this Agreement, the Borrower may borrow,
repay and borrow again pursuant to this Section 2.1.2.
2.2 NATURE OF BANKS' OBLIGATIONS WITH RESPECT TO REVOLVING CREDIT
LOANS.
Each Bank shall be obligated to participate in each request
for Revolving Credit Loans pursuant to Section 2.4 [Loan Requests] in accordance
with its Ratable Share. The aggregate of each Bank's Revolving Credit Loans
outstanding hereunder to the Borrower at any time shall never exceed its
Revolving Credit Commitment minus its Ratable Share of the Letters of Credit
Outstanding. The obligations of each Bank hereunder are several. The failure of
any Bank to perform its obligations hereunder shall not affect the Obligations
of the Borrower to any other party nor shall any other party be liable for the
failure of such Bank to perform its obligations hereunder. The Banks shall have
no obligation to make Loans hereunder on or after the Expiration Date.
2.3 REVOLVING CREDIT COMMITMENT FEES.
Accruing from the date hereof until the Expiration Date, the
Borrower agrees to pay to the Agent for the account of each Bank, as
consideration for such Bank's Revolving Credit Commitment hereunder, a
nonrefundable commitment fee (the "Revolving Credit Commitment Fee") equal to
the Applicable Revolving Credit Commitment Fee Rate (computed on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed) on the
average daily difference between the amount of (i) such Bank's Revolving Credit
Commitment as the same may be constituted from time to time and the (ii) the sum
of such Bank's Revolving Credit Loans outstanding plus its Ratable Share of
Letters of Credit Outstanding. All Revolving Credit Commitment Fees shall be
payable in arrears on the first Business Day of each January, April, July and
October after the date hereof and on the Expiration Date or upon acceleration of
the Revolving Credit Notes.
2.4 LOAN REQUESTS.
2.4.1. REVOLVING CREDIT LOAN REQUESTS.
Except as otherwise provided herein, the Borrower may from
time to time prior to the Expiration Date request the Banks to make Revolving
Credit Loans, or renew or convert the
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Interest Rate Option applicable to existing Revolving Credit Loans pursuant to
Section 3.1[Interest Rate Options] and 3.2 [Interest Periods], by delivering to
the Agent, not later than 10:00 a.m., Pittsburgh time, (i) three (3) Business
Days prior to the proposed Borrowing Date with respect to the making of
Revolving Credit Loans to which the Euro-Rate Option applies or the conversion
to or the renewal of the Euro-Rate Option for any Revolving Credit Loans; and
(ii) one (1) Business Day prior to either the proposed Borrowing Date with
respect to the making of a Revolving Credit Loan to which the Base Rate Option
applies or the last day of the preceding Revolving Credit Interest Period with
respect to the conversion to the Base Rate Option for any Revolving Credit Loan,
of a duly completed request therefor substantially in the form of EXHIBIT 2.4.1
or a request by telephone immediately confirmed in writing by letter, facsimile
or telex in such form (each, a "Revolving Credit Loan Request"), it being
understood that the Agent may rely on the authority of any individual making
such a telephonic request without the necessity of receipt of such written
confirmation. Each Revolving Credit Loan Request shall be irrevocable and shall
specify (i) the proposed Borrowing Date; (ii) the aggregate amount of the
proposed Revolving Credit Loans comprising each Borrowing Tranche, which shall
be in integral multiples of $500,000 and not less than $1,000,000 for each
Borrowing Tranche to which the Euro-Rate Option applies and not less than the
lesser of $500,000 or the maximum amount available for Borrowing Tranches to
which the Base Rate Option applies; (iii) whether the Euro-Rate Option or Base
Rate Option shall apply to the proposed Revolving Credit Loans comprising the
applicable Borrowing Tranche; and (iv) in the case of a Borrowing Tranche to
which the Euro-Rate Option applies, an appropriate Revolving Credit Interest
Period for the Revolving Credit Loans comprising such Borrowing Tranche.
2.4.2. SWING LOAN REQUESTS.
Except as otherwise provided herein, the Borrower may
from time to time prior to the Expiration Date request PNC Bank to make Swing
Loans by delivering to PNC Bank not later than 2:00 p.m., Pittsburgh time on the
proposed Borrowing Date a duly completed request therefor substantially in the
form of EXHIBIT 2.4.2 hereto or a request by telephone immediately confirmed in
writing by letter, facsimile or telex (each, a "Swing Loan Request"), it being
understood that the PNC Bank may rely on the authority of any individual making
such a telephonic request without the necessity of receipt of such written
confirmation. Each Swing Loan Request shall be irrevocable and shall specify (i)
the proposed Borrowing Date, (ii) the Swing Loan Swing Loan Interest Period, and
(iii) the principal amount of such Swing Loan, which shall be not less than
$500,000 and shall be an integral multiple of $500,000.
2.5 MAKING LOANS.
2.5.1. MAKING REVOLVING CREDIT LOANS.
The Agent shall, promptly after receipt by it of a Revolving
Credit Loan Request pursuant to Section 2.4 [Loan Requests], notify the Banks of
its receipt of such Revolving Credit Loan Request specifying: (i) the proposed
Borrowing Date and the time and method of disbursement of the Revolving Credit
Loans requested thereby; (ii) the amount and type of each
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such Revolving Credit Loan and the applicable Revolving Credit Interest Period
(if any); and (iii) the apportionment among the Banks of such Revolving Credit
Loans as determined by the Agent in accordance with Section 2.2 [Nature of
Banks' Obligations]. Each Bank shall remit the principal amount of each
Revolving Credit Loan to the Agent such that the Agent is able to, and the Agent
shall, to the extent the Banks have made funds available to it for such purpose
and subject to Section 6.2 [Each Additional Loan], fund such Revolving Credit
Loans to the Borrower in U.S. Dollars and immediately available funds at the
Principal Office prior to 2:00 p.m., Pittsburgh time, on the applicable
Borrowing Date, PROVIDED that if any Bank fails to remit such funds to the Agent
in a timely manner, the Agent may elect in its sole discretion to fund with its
own funds the Revolving Credit Loans of such Bank on such Borrowing Date, and
such Bank shall be subject to the repayment obligation in Section 9.16
[Availability of Funds].
2.5.2. MAKING SWING LOANS; REPAYMENT.
So long as PNC Bank makes Swing Loans, PNC Bank shall, after
receipt by it of a Swing Loan Request pursuant to Section 2.4.2, fund such Swing
Loan to the Borrower in U.S. Dollars and immediately available funds at the
Principal Office prior to 3 p.m. Pittsburgh time on the Borrowing Date, such
request to specify the Swing Loan Interest Period (which shall also be the due
date (the "Swing Loan Due Date" for such Swing Loan). Swing Loans shall bear
interest at the Offered Rate Option. Swing Loans shall be repaid on the Swing
Loan Due Date or such earlier times as may be specified in this Agreement.
2.6 NOTES.
2.6.1. REVOLVING CREDIT NOTE.
The Obligation of the Borrower to repay the aggregate unpaid
principal amount of the Revolving Credit Loans made to it by each Bank, together
with interest thereon, shall be evidenced by a Revolving Credit Note dated the
Closing Date payable to the order of such Bank in a face amount equal to the
Revolving Credit Commitment of such Bank.
2.6.2. SWING LOAN NOTE.
The obligation of the Borrower to repay the unpaid principal
amount of the Swing Loans made to it by PNC Bank together with interest thereon
shall be evidenced by a promissory note of the Borrower dated the Closing Date
in substantially the form attached hereto as EXHIBIT 1.1(S) payable to the order
of PNC Bank in a face amount equal to the Swing Loan Commitment.
2.7 USE OF PROCEEDS.
The proceeds of the Loans shall be used as provided for in
the recitals and in accordance with Section 7.1.10 [Use of Proceeds].
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2.8 BORROWINGS TO REPAY SWING LOANS.
PNC Bank may, at its option, exercisable at any time for any
reason whatsoever, demand repayment of the Swing Loans, and each Bank shall make
a Revolving Credit Loan in an amount equal to such Bank's Ratable Share of the
aggregate principal amount of the outstanding Swing Loans, plus, if PNC Bank so
requests, accrued interest thereon, PROVIDED that no Bank shall be obligated in
any event to make Revolving Credit Loans in excess of its Revolving Credit
Commitment and that the Revolving Facility Usage shall not exceed the Revolving
Credit Commitment. Revolving Credit Loans made pursuant to the preceding
sentence shall bear interest at the Base Rate Option and shall be deemed to have
been properly requested in accordance with Section 2.4.1 without regard to any
of the requirements of that provision. PNC Bank shall provide notice to the
Banks (which may be telephonic or written notice by letter, facsimile or telex)
that such Revolving Credit Loans are to be made under this Section 2.8 and of
the apportionment among the Banks, and the Banks shall be unconditionally
obligated to fund such Revolving Credit Loans (whether or not the conditions
specified in Section 2.4.1 are then satisfied and whether or not an Event of
Default or Potential Default (including any Event of Default specified in
Section 8.1.14 or 8.1.15) exists at the time PNC Bank so requests) not later
than 3:00 p.m. Pittsburgh time on the Business Day next after the date the Banks
receive such notice from PNC Bank.
2.9 ADDITIONAL BANKS; INCREASE IN REVOLVING CREDIT COMMITMENTS.
The Borrower may request that a new bank (each an "Additional
Bank") join this Agreement and provide a Revolving Credit Commitment hereunder
and that the Revolving Credit Commitments be increased by the amount of such new
Revolving Credit Commitment and such Additional Bank shall join this Agreement
as a Bank hereunder provided that:
(i) The Agent shall consent to the selection of such
Additional Bank, which consent shall not be unreasonably withheld, conditioned
or delayed;
(ii) Such new Additional Bank's Revolving Credit
Commitment shall be at least $5,000,000 and an integral multiple of $1,000,000;
(iii) Such new bank shall sign a Bank Joinder and join
this Agreement as a Bank pursuant to the procedures contained in Section 10.12;
and
(iv) After giving effect to the Revolving Credit
Commitment of such Additional Bank, the amount of the Revolving Credit
Commitments shall not exceed $30,000,000.
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2.10 LETTER OF CREDIT SUBFACILITY.
2.10.1. ISSUANCE OF LETTERS OF CREDIT.
Borrower may request the issuance of a letter of
credit (each a "Letter of Credit") on behalf of itself or another Loan Party by
delivering or having such other Loan Party deliver to the Agent or any other
Bank which agrees to issue Letters of Credit hereunder (each an "Issuing Bank")
(with a copy of such notice to the Agent) a completed application and agreement
for letters of credit in such form as the Issuing Bank may specify from time to
time by no later than 10:00 a.m., Pittsburgh time, at least five (5) Business
Days in advance of the proposed date of issuance of Standby Letters of Credit,
or such shorter period as may be agreed to by the Issuing Bank, or one (1)
Business Day (such notice period may be increased to two (2) Business Days at
the request of the Issuing Bank if it reasonably determines that it requires
more notice) in advance of the proposed date of issuance of Trade Letters of
Credit. Each Letter of Credit shall be a Standby Letter of Credit or a Trade
Letter of Credit. Subject to the terms and conditions hereof and in reliance on
the agreements of the other Banks set forth in this Section 2.8, the Issuing
Bank or any of the Issuing Bank's Affiliates will issue a Letter of Credit
provided that each Letter of Credit shall (A) have a maximum maturity of twelve
(12) months from the date of issuance, and (B) in no event expire later than ten
(10) Business Days prior to the Expiration Date and providing that in no event
shall (i) the Letters of Credit Outstanding exceed, at any one time, $20,000,000
or (ii) the Revolving Facility Usage exceed, at any one time, the Revolving
Credit Commitments. Each Issuing Bank shall notify the Agent within one (1)
Business Day after any new Letter of Credit is issued or the face amount of
Letters of Credit outstanding and issued by such Issuing Bank has changed and
shall from time to time and upon request of the Agent deliver a schedule of the
outstanding Letters of Credit issued by such Issuing Bank.
2.10.2. LETTER OF CREDIT FEES.
The Borrower shall pay (i) to the Agent for the
ratable account of the Banks a fee (the "Letter of Credit Fee") equal to the
Applicable Margin for Standby Letters of Credit and 50% of the Applicable Margin
for Trade Letters of Credit, and (ii) to the Issuing Bank for its own account a
fronting fee equal to 1/8% (computed on the basis of a year of 360 days and
actual days elapsed), which fee shall be computed on the daily average Letters
of Credit Outstanding and shall be payable quarterly in arrears commencing with
the first Business Day of each January, April, July and October following
issuance of each Letter of Credit and on the Expiration Date. The Borrower shall
also pay to the Issuing Bank for the Issuing Bank's sole account the Issuing
Bank's then in effect customary fees and administrative expenses payable with
respect to the Letters of Credit as the Issuing Bank may generally charge or
incur from time to time in connection with the issuance, maintenance,
modification (if any), assignment or transfer (if any), negotiation, and
administration of Letters of Credit.
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2.10.3. DISBURSEMENTS, REIMBURSEMENT.
2.10.3.1 Immediately upon the issuance of each Letter
of Credit, each Bank shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Issuing Bank a participation in
such Letter of Credit and each drawing thereunder in an amount equal to such
Bank's Ratable Share of the maximum amount available to be drawn under such
Letter of Credit and the amount of such drawing, respectively.
2.10.3.2 In the event of any request for a drawing
under a Letter of Credit by the beneficiary or transferee thereof, the Issuing
Bank will promptly notify the Borrower and the Agent. Provided that it shall
have received such notice, the Borrower shall reimburse (such obligation to
reimburse the Issuing Bank shall sometimes be referred to as a "Reimbursement
Obligation") the Issuing Bank prior to 12:00 noon, Pittsburgh time on each date
that an amount is paid by the Issuing Bank under any Letter of Credit (each such
date, an "Drawing Date") in an amount equal to the amount so paid by the Issuing
Bank. In the event the Borrower fails to reimburse the Issuing Bank for the full
amount of any drawing under any Letter of Credit by 12:00 noon, Pittsburgh time,
on the Drawing Date, the Issuing Bank will promptly notify the Agent and each
Bank thereof, and the Borrower shall be deemed to have requested that Revolving
Credit Loans be made by the Banks under the Base Rate Option to be disbursed on
the Drawing Date under such Letter of Credit, subject to such request not
exceeding the amount of the unutilized portion of the Revolving Credit
Commitment and subject to the conditions set forth in Section 6.2 [Each
Additional Loan] other than any notice requirements. Any notice given by the
Issuing Bank pursuant to this Section 2.10.3.2 may be oral if immediately
confirmed in writing; provided that the lack of such an immediate confirmation
shall not affect the conclusiveness or binding effect of such notice.
2.10.3.3 Each Bank shall upon any notice pursuant to
Section 2.10.3.2 make available to the Agent who shall thereafter disburse the
same to the Issuing Bank an amount in immediately available funds equal to its
Ratable Share of the amount of the drawing, whereupon the participating Banks
shall (subject to Section 2.10.3.4) each be deemed to have made a Revolving
Credit Loan under the Base Rate Option to the Borrower in that amount. If any
Bank so notified fails to make available to the Agent for the account of the
Issuing Bank the amount of such Bank's Ratable Share of such amount by no later
than 2:00 p.m., Pittsburgh time on the Drawing Date, then interest shall accrue
on such Bank's obligation to make such payment, from the Drawing Date to the
date on which such Bank makes such payment (i) at a rate per annum equal to the
Federal Funds Effective Rate during the first three days following the Drawing
Date and (ii) at a rate per annum equal to the rate applicable to Revolving
Credit Loans under the Base Rate Option on and after the fourth day following
the Drawing Date. The Issuing Bank will promptly give notice of the occurrence
of the Drawing Date, but failure of the Issuing Bank to give any such notice on
the Drawing Date or in sufficient time to enable any Bank to effect such payment
on such date shall not relieve such Bank from its obligation under this Section
2.10.3.3.
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2.10.3.4 With respect to any unreimbursed drawing
that is not converted into Revolving Credit Loans under the Base Rate Option to
the Borrower in whole or in part as contemplated by Section 2.10.3.2, because of
the Borrower's failure to satisfy the conditions set forth in Section 6.2 [Each
Additional Loan] other than any notice requirements or for any other reason, the
Borrower shall be deemed to have incurred from the Issuing Bank a borrowing
(each a "Letter of Credit Borrowing") in the amount of such drawing. Such Letter
of Credit Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at the rate per annum applicable to the Revolving Credit
Loans under the Base Rate Option. Each Bank's payment to the Agent for the
benefit of the Issuing Bank pursuant to Section 2.10.3.3 shall be deemed to be a
payment in respect of its participation in such Letter of Credit Borrowing and
shall constitute a "Participation Advance" from such Bank in satisfaction of its
participation obligation under this Section 2.10.3.
2.10.4. REPAYMENT OF PARTICIPATION ADVANCES.
2.10.4.1 Upon (and only upon) receipt by the Agent for
the benefit of the Issuing Bank of immediately available funds from the Borrower
or receipt by the Issuing Bank of any such funds from the Agent (i) in
reimbursement of any payment made by the Issuing Bank under the Letter of Credit
with respect to which any Bank has made a Participation Advance to the Agent for
the benefit of the Issuing Bank, or (ii) in payment of interest on such a
payment made by the Issuing Bank under such a Letter of Credit, the Agent, or
Issuing Bank, as the case may be, will pay to each Bank (or to the Agent for
payment to each Bank), in the same funds as those received by the Agent or the
Issuing Bank, as the case may be, the amount of such Bank's Ratable Share of
such funds, except the Agent shall retain and turnover to the Issuing Bank (or
the Issuing Banks shall retain) the amount of the Ratable Share of such funds of
any Bank that did not make a Participation Advance in respect of such payment.
2.10.4.2 If the Agent or any Issuing Bank is required
at any time to return to any Loan Party, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of the
payments made by any Loan Party to the Agent or by the Agent to such Issuing
Bank pursuant to Section 2.10.4.1 in reimbursement of a payment made under the
Letter of Credit or interest or fee thereon, each Bank shall, on demand of the
Agent, forthwith return to the Agent or to the Agent for the benefit of such
Issuing Bank the amount of its Ratable Share of any amounts so returned plus
interest thereon from the date such demand is made to the date such amounts are
returned by such Bank to the Agent or the Issuing Bank, at a rate per annum
equal to the Federal Funds Effective Rate in effect from time to time.
2.10.5. DOCUMENTATION.
Each Loan Party agrees to be bound by the terms of the
Issuing Bank's application and agreement for letters of credit and the Issuing
Bank's written regulations and customary practices relating to letters of
credit, though such interpretation may be different from such Loan Party's own.
In the event of a conflict between such application or agreement and this
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Agreement, this Agreement shall govern. It is understood and agreed that, except
in the case of gross negligence or willful misconduct, the Issuing Bank shall
not be liable for any error, negligence and/or mistakes, whether of omission or
commission, in following any Loan Party's instructions or those contained in the
Letters of Credit or any modifications, amendments or supplements thereto.
2.10.6. DETERMINATIONS TO HONOR DRAWING REQUESTS.
In determining whether to honor any request for
drawing under any Letter of Credit by the beneficiary thereof, the Issuing Bank
shall be responsible only to determine that the documents and certificates
required to be delivered under such Letter of Credit have been delivered and
that they comply on their face with the requirements of such Letter of Credit.
2.10.7. NATURE OF PARTICIPATION AND REIMBURSEMENT OBLIGATIONS.
Each Bank's obligation in accordance with this
Agreement to make the Revolving Credit Loans or Participation Advances, as
contemplated by Section 2.10.3, as a result of a drawing under a Letter of
Credit, and the Obligations of the Borrower to reimburse the Issuing Bank upon a
draw under a Letter of Credit, shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms of this Section
2.10.7 under all circumstances, including the following circumstances:
(i) any set-off, counterclaim, recoupment,
defense or other right which such Bank may have against the Issuing Bank or any
of its Affiliates, the Borrower or any other Person for any reason whatsoever;
(ii) the failure of any Loan Party or any other
Person to comply, in connection with a Letter of Credit Borrowing, with the
conditions set forth in Section 2.1 [Commitments] 2.4 [Loan Requests] 2.5
[Making Loans] or 6.2 [Each Additional Loan] or as otherwise set forth in this
Agreement for the making of a Revolving Credit Loan, it being acknowledged that
such conditions are not required for the making of a Letter of Credit Borrowing
and the obligation of the Banks to make Participation Advances under Section
2.10.3;
(iii) any lack of validity or enforceability of
any Letter of Credit;
(iv) any claim of breach of warranty that might
be made by any Loan Party or any Bank against any beneficiary of a Letter of
Credit, or the existence of any claim, set-off, recoupment, counterclaim,
crossclaim, defense or other right which any Loan Party or any Bank may have at
any time against a beneficiary, successor beneficiary any transferee or assignee
of any Letter of Credit or the proceeds thereof (or any Persons for whom any
such transferee may be acting), the Issuing Bank or its Affiliates or any Bank
or any other Person or, whether in connection with this Agreement, the
transactions contemplated herein or
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any unrelated transaction (including any underlying transaction between any Loan
Party or Subsidiaries of a Loan Party and the beneficiary for which any Letter
of Credit was procured);
(v) the lack of power or authority of any signer
of (or any defect in or forgery of any signature or endorsement on), or the form
of or lack of validity, sufficiency, accuracy, enforceability or genuineness of,
any draft, demand, instrument, certificate or other document presented under or
in connection with any Letter of Credit, or any fraud or alleged fraud in
connection with any Letter of Credit, or the transport of any property or
provisions of services relating to a Letter of Credit, in each case even if the
Issuing Bank or any of the Issuing Bank's Affiliates has been notified thereof;
(vi) payment by the Issuing Bank or any of its
Affiliates under any Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the terms of such
Letter of Credit;
(vii) the solvency of, or any acts or omissions
by, any beneficiary of any Letter of Credit, or any other Person having a role
in any transaction or obligation relating to a Letter of Credit, or the
existence, nature, quality, quantity, condition, value or other characteristic
of any property or services relating to a Letter of Credit;
(viii) any failure by the Issuing Bank or any of
Issuing Bank's Affiliates to issue any Letter of Credit in the form requested by
any Loan Party, unless the Issuing Bank has received written notice from such
Loan Party of such failure within three Business Days after the Issuing Bank
shall have furnished such Loan Party a copy of such Letter of Credit and such
error is material and no drawing has been made thereon prior to receipt of such
notice;
(ix) any adverse change in the business,
operations, properties, assets, condition (financial or otherwise) or prospects
of any Loan Party or Subsidiaries of a Loan Party;
(x) any breach of this Agreement or any other
Loan Document by any party thereto;
(xi) the occurrence or continuance of an
Insolvency Proceeding with respect to any Loan Party;
(xii) the fact that an Event of Default or a
Potential Default shall have occurred and be continuing;
(xiii) the fact that the Expiration Date shall
have passed or this Agreement or the Commitments hereunder shall have been
terminated; and
(xiv) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing.
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2.10.8. INDEMNITY.
In addition to amounts payable as provided in Section 10.3
[Reimbursement of Banks by Borrower, Etc.] and 9.5 [Reimbursement of Agent by
Borrower, Etc.], the Borrower hereby agrees to protect, indemnify, pay and save
harmless the Issuing Bank and any of Issuing Bank's Affiliates that has issued a
Letter of Credit from and against any and all claims, demands, liabilities,
damages, taxes, penalties, interest, judgments, losses, costs, charges and
expenses (including reasonable fees, expenses and disbursements of counsel and
allocated costs of internal counsel) which the Issuing Bank or any of Issuing
Bank's Affiliates may incur or be subject to as a consequence, direct or
indirect, of the issuance of any Letter of Credit, other than as a result of (A)
the gross negligence or willful misconduct of the Issuing Bank or any of its
Affiliates as determined by a final judgment of a court of competent
jurisdiction or (B) the wrongful dishonor by the Issuing Bank or any of Issuing
Bank's Affiliates of a proper demand for payment made under any Letter of
Credit, except if such dishonor resulted from any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions herein called "Governmental
Acts").
2.10.9. LIABILITY FOR ACTS AND OMISSIONS.
As between any Loan Party and the Issuing Bank, or the
Issuing Bank's Affiliates, such Loan Party assumes all risks of the acts and
omissions of, or misuse of the Letters of Credit by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, the Issuing Bank shall not be responsible for any of the
following including any losses or damages to any Loan Party or other Person or
property relating therefrom: (i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for an issuance of any such Letter of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged (even if the Issuing Bank or the Issuing Bank's
Affiliates shall have been notified thereof); (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any such Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) the failure of the beneficiary of any such Letter of Credit,
or any other party to which such Letter of Credit may be transferred, to comply
fully with any conditions required in order to draw upon such Letter of Credit
or any other claim of any Loan Party against any beneficiary of such Letter of
Credit, or any such transferee, or any dispute between or among any Loan Party
and any beneficiary of any Letter of Credit or any such transferee; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of the Issuing Bank or the Issuing Bank's
Affiliates, as applicable, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of the Issuing
Bank's or the Issuing
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Bank's Affiliates rights or powers hereunder. Nothing in the preceding sentence
shall relieve the Issuing Bank from liability for the Issuing Bank's or any of
its Affiliates' gross negligence or willful misconduct in connection with
actions or omissions described in such clauses (i) through (viii) of such
sentence. In no event shall the Issuing Bank or the Issuing Bank's Affiliates be
liable to any Loan Party for any indirect, consequential, incidental, punitive,
exemplary or special damages or expenses (including without limitation
attorneys' fees), or for any damages resulting from any change in the value of
any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the
Issuing Bank and each of its Affiliates in the exercise of good faith, (i) may
rely on any oral or other communication believed in good faith by the Issuing
Bank or such Affiliate to have been authorized or given by or on behalf of the
applicant for a Letter of Credit, (ii) may honor any presentation if the
documents presented appear on their face substantially to comply with the terms
and conditions of the relevant Letter of Credit; (iii) may honor a previously
dishonored presentation under a Letter of Credit, whether such dishonor was
pursuant to a court order, to settle or compromise any claim of wrongful
dishonor, or otherwise, and shall be entitled to reimbursement to the same
extent as if such presentation had initially been honored, together with any
interest paid by the Issuing Bank or its Affiliate; (iv) may honor any drawing
that is payable upon presentation of a statement advising negotiation or
payment, upon receipt of such statement (even if such statement indicates that a
draft or other document is being delivered separately), and shall not be liable
for any failure of any such draft or other document to arrive, or to conform in
any way with the relevant Letter of Credit; (v) may pay any paying or
negotiating bank claiming that it rightfully honored under the laws or practices
of the place where such bank is located; and (vi) may settle or adjust any claim
or demand made on the Issuing Bank or its Affiliate in any way related to any
order issued at the applicant's request to an air carrier, a letter of guarantee
or of indemnity issued to a carrier or any similar document (each an "Order")
and honor any drawing in connection with any Letter of Credit that is the
subject to such Order, notwithstanding that any drafts or other documents
presented in connection with such Letter of Credit fail to conform in any way
with such Letter of Credit.
In furtherance and extension and not in limitation of the
specific provisions set forth above, any action taken or omitted by the Issuing
Bank or the Issuing Bank's Affiliates under or in connection with the Letters of
Credit issued by it or any documents and certificates delivered thereunder, if
taken or omitted in good faith, shall not put the Issuing Bank or the Issuing
Bank's Affiliates under any resulting liability to the Borrower or any Bank.
2.11 BORROWING BASE EXCEEDED.
Whenever the outstanding principal balance of Revolving
Facility Usage exceeds the Borrowing Base, the Borrower shall make, within one
(1) Business Day after the Borrower learns of such excess and whether or not the
Agent has given notice to such effect, a mandatory prepayment of principal equal
to the excess of the Revolving Facility Usage over the Borrowing Base, together
with accrued interest on such principal amount.
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3. INTEREST RATES
3.1 INTEREST RATE OPTIONS.
The Borrower shall pay interest in respect of the outstanding
unpaid principal amount of the Revolving Credit Loans as selected by it from the
Base Rate Option or Euro-Rate Option set forth below applicable to the Revolving
Credit Loans, it being understood that, subject to the provisions of this
Agreement, the Borrower may select different Interest Rate Options and different
Interest Periods to apply simultaneously to the Revolving Credit Loans
comprising different Borrowing Tranches and may convert to or renew one or more
Interest Rate Options with respect to all or any portion of the Revolving Credit
Loans comprising any Borrowing Tranche. There shall not be at any one time
outstanding more than six (6) Borrowing Tranches in the aggregate among all of
the Loans. If at any time the designated rate applicable to any Loan made by any
Bank exceeds such Bank's highest lawful rate, the rate of interest on such
Bank's Loan shall be limited to such Bank's highest lawful rate.
3.1.1. INTEREST RATE OPTIONS.
The Borrower shall have the right to select from the
following Interest Rate Options applicable to the Revolving Credit Loans:
(i) BASE RATE OPTION: A fluctuating rate per
annum (computed on the basis of a year of 365 or 366 days, as the case may be,
and actual days elapsed) equal to the Base Rate, such interest rate to change
automatically from time to time effective as of the effective date of each
change in the Base Rate; or
(ii) EURO-RATE OPTION: A rate per annum (computed
on the basis of a year of 360 days and actual days elapsed) equal to the
Euro-Rate plus the Applicable Margin.
The Borrower shall pay interest on the Swing Loans
under the Offered Rate Option.
3.1.2. RATE QUOTATIONS.
The Borrower may call the Agent on or before the date on
which a Loan Request is to be delivered to receive an indication of the rates
then in effect, but it is acknowledged that such projection shall not be binding
(except with respect to Swing Loans) on the Agent or the Banks nor affect the
rate of interest which thereafter is actually in effect when the election is
made.
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3.2 REVOLVING CREDIT INTEREST PERIODS.
At any time when the Borrower shall select, convert to or renew a
Euro-Rate Option, the Borrower shall notify the Agent thereof at least three (3)
Business Days prior to the effective date of such Euro-Rate Option by delivering
a Revolving Credit Loan Request. The notice shall specify a Revolving Credit
Interest Period during which such Interest Rate Option shall apply.
Notwithstanding the preceding sentence, the following provisions shall apply to
any selection of, renewal of, or conversion to a Euro-Rate Option:
3.2.1. AMOUNT OF BORROWING TRANCHE.
Each Borrowing Tranche of Euro-Rate Revolving Credit Loans
shall be in integral multiples of $500,000 and not less than $1,000,000. Each
Borrowing Tranche of Swing Loans shall be in integral multiples of $500,000 and
not less than $500,000.
3.2.2. RENEWALS.
In the case of the renewal of a Euro-Rate Option at the
end of a Revolving Credit Interest Period, the first day of the new Revolving
Credit Interest Period shall be the last day of the preceding Revolving Credit
Interest Period, without duplication in payment of interest for such day.
3.3 INTEREST AFTER DEFAULT.
To the extent permitted by Law, upon the occurrence of an
Event of Default and until such time such Event of Default shall have been cured
or waived:
3.3.1. LETTER OF CREDIT FEES, INTEREST RATE.
the Letter of Credit Fees and the rate of interest for each
Loan otherwise applicable pursuant to Section 2.10.2 [Letter of Credit Fees] or
Section 3.1 [Interest Rate Options], respectively, shall be increased by 2.0%
per annum; and
3.3.2. OTHER OBLIGATIONS.
each other Obligation hereunder if not paid when due shall
bear interest at a rate per annum equal to the sum of the rate of interest
applicable under the Base Rate Option plus an additional 2.0% per annum from the
time such Obligation becomes due and payable and until it is paid in full.
3.3.3. ACKNOWLEDGMENT.
The Borrower acknowledges that the increase in rates
referred to in this Section 3.3 reflects, among other things, the fact that such
Loans or other amounts have become a substantially greater risk given their
default status and that the Banks are entitled to additional
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compensation for such risk; and all such interest shall be payable by Borrower
upon demand by Agent.
3.4 EURO-RATE UNASCERTAINABLE; ILLEGALITY; INCREASED COSTS; DEPOSITS
NOT AVAILABLE.
3.4.1. UNASCERTAINABLE.
If on any date on which a Euro-Rate would otherwise
be determined, the Agent shall have determined that:
(i) adequate and reasonable means do not exist for
ascertaining such Euro-Rate, or
(ii) a contingency has occurred which materially and
adversely affects the London interbank eurodollar market relating to the
Euro-Rate, the Agent shall have the rights specified in Section 3.4.3.
3.4.2. ILLEGALITY; INCREASED COSTS; DEPOSITS NOT AVAILABLE.
If at any time any Bank shall have determined that:
(i) the making, maintenance or funding of any
Revolving Credit Loan to which a Euro-Rate Option applies has been made
impracticable or unlawful by compliance by such Bank in good faith with any Law
or any interpretation or application thereof by any Official Body or with any
request or directive of any such Official Body (whether or not having the force
of Law), or
(ii) such Euro-Rate Option will not adequately and
fairly reflect the cost to such Bank of the establishment or maintenance of any
such Revolving Credit Loan, or
(iii) after making all reasonable efforts, deposits
of the relevant amount in Dollars for the relevant Revolving Credit Interest
Period for a Revolving Credit Loan, or to banks generally, to which a Euro-Rate
Option applies, respectively, are not available to such Bank with respect to
such Revolving Credit Loan, or to banks generally, in the interbank eurodollar
market,
then the Agent shall have the rights specified in Section 3.4.3.
3.4.3. AGENT'S AND BANK'S RIGHTS.
In the case of any event specified in Section 3.4.1 above,
the Agent shall promptly so notify the Banks and the Borrower thereof, and in
the case of an event specified in Section 3.4.2 above, such Bank shall promptly
so notify the Agent and endorse a certificate to such notice as to the specific
circumstances of such notice, and the Agent shall promptly send
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copies of such notice and certificate to the other Banks and the Borrower. Upon
such date as shall be specified in such notice (which shall not be earlier than
the date such notice is given), the obligation of (A) the Banks, in the case of
such notice given by the Agent, or (B) such Bank, in the case of such notice
given by such Bank, to allow the Borrower to select, convert to or renew a
Euro-Rate Option shall be suspended until the Agent shall have later notified
the Borrower, or such Bank shall have later notified the Agent, of the Agent's
or such Bank's, as the case may be, determination that the circumstances giving
rise to such previous determination no longer exist. If at any time the Agent
makes a determination under Section 3.4.1 and the Borrower has previously
notified the Agent of its selection of, conversion to or renewal of a Euro-Rate
Option and such Interest Rate Option has not yet gone into effect, such
notification shall be deemed to provide for selection of, conversion to or
renewal of the Base Rate Option otherwise available with respect to such
Revolving Credit Loans. If any Bank notifies the Agent of a determination under
Section 3.4.2, the Borrower shall, subject to the Borrower's indemnification
Obligations under Section 4.6.2 [Indemnity], as to any Revolving Credit Loan of
the Bank to which a Euro-Rate Option applies, on the date specified in such
notice either convert such Revolving Credit Loan to the Base Rate Option
otherwise available with respect to such Revolving Credit Loan or prepay such
Revolving Credit Loan in accordance with Section 4.4 [Voluntary Prepayments].
Absent due notice from the Borrower of conversion or prepayment, such Revolving
Credit Loan shall automatically be converted to the Base Rate Option otherwise
available with respect to such Revolving Credit Loan upon such specified date.
3.5 SELECTION OF INTEREST RATE OPTIONS.
If the Borrower fails to select a new Revolving Credit Interest
Period to apply to any Borrowing Tranche of Revolving Credit Loans under the
Euro-Rate Option at the expiration of an existing Revolving Credit Interest
Period applicable to such Borrowing Tranche in accordance with the provisions of
Section 3.2 [Interest Periods], the Borrower shall be deemed to have converted
such Borrowing Tranche to the Base Rate Option, commencing upon the last day of
the existing Revolving Credit Interest Period.
4. PAYMENTS
4.1 PAYMENTS.
All payments and prepayments to be made in respect of principal,
interest, Revolving Credit Commitment Fee, Letter of Credit Fees, Agent's Fee or
other fees or amounts due from the Borrower hereunder shall be payable prior to
11:00 a.m., Pittsburgh time, on the date when due without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived by the
Borrower, and without set-off, counterclaim or other deduction of any nature,
and an action therefor shall immediately accrue. Such payments shall be made to
the Agent at the Principal Office for the account of PNC Bank with respect to
the Swing Loans and for the ratable accounts of the Banks with respect to the
Loans in U.S. Dollars and in immediately available funds, and the Agent shall
promptly distribute such amounts to the Banks
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in immediately available funds, PROVIDED that in the event payments are received
by 11:00 a.m., Pittsburgh time, by the Agent with respect to the Loans and such
payments are not distributed to the Banks on the same day received by the Agent,
the Agent shall pay the Banks the Federal Funds Effective Rate with respect to
the amount of such payments for each day held by the Agent and not distributed
to the Banks. The Agent's and each Bank's statement of account, ledger or other
relevant record shall, in the absence of manifest error, be conclusive as the
statement of the amount of principal of and interest on the Loans and other
amounts owing under this Agreement and shall be deemed an "account stated."
4.2 PRO RATA TREATMENT OF BANKS.
Each borrowing shall be allocated to each Bank according to its
Ratable Share, and each selection of, conversion to or renewal of any Interest
Rate Option and each payment or prepayment by the Borrower with respect to
principal, interest, Revolving Credit Commitment Fee, Letter of Credit Fees, or
other fees or amounts due from the Borrower hereunder to the Banks with respect
to the Loans, shall (except as provided in Section 3.4.3 [Agent's and Bank's
Rights] in the case of an event specified in Section 3.4 [Euro-Rate
Unascertainable; Etc.], 4.4.2 [Replacement of a Bank] or 4.6 [Additional
Compensation in Certain Circumstances]) be made in proportion to the applicable
Loans outstanding from each Bank and, if no such Loans are then outstanding, in
proportion to the Ratable Share of each Bank. Notwithstanding any of the
foregoing, each borrowing or payment or prepayment by the Borrower of principal,
interest, fees or other amounts from the Borrower with respect to Swing Loans
shall be made by or to PNC Bank according to Section 2.
4.3 INTEREST PAYMENT DATES.
Interest on Revolving Credit Loans to which the Base Rate Option
applies shall be due and payable in arrears on the first Business Day of each
January, April, July and October after the date hereof and on the Expiration
Date or upon acceleration of the Revolving Credit Notes. Interest on Revolving
Credit Loans to which the Euro-Rate Option applies shall be due and payable on
the last day of each Interest Period for those Revolving Credit Loans and, if
such Interest Period is longer than three (3) Months, also on the 90th day of
such Interest Period. Interest on Swing Loans shall be due and payable on the
last day of the applicable Swing Loan Interest Period. Interest on mandatory
prepayments of principal under Section 4.5 [Mandatory Prepayments] shall be due
on the date such mandatory prepayment is due. Interest on the principal amount
of each Loan or other monetary Obligation shall be due and payable on demand
after such principal amount or other monetary Obligation becomes due and payable
(whether on the stated maturity date, upon acceleration or otherwise).
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4.4 VOLUNTARY PREPAYMENTS.
4.4.1. RIGHT TO PREPAY.
The Borrower shall have the right at its option from time
to time to prepay the Loans in whole or part without premium or penalty (except
as provided in Section 4.4.2 below or in Section 4.6 [Additional Compensation in
Certain Circumstances]):
(i) at any time with respect to any Revolving Credit
Loan to which the Base Rate Option applies,
(ii) on the last day of the applicable Revolving
Credit Interest Period with respect to Revolving Credit Loans to which a
Euro-Rate Option applies,
(iii) on the last day of the applicable Swing Loan
Interest Period with respect to Swing Loan Loans,
(iv) on the date specified in a notice by any Bank
pursuant to Section 3.4 [Euro-Rate Unascertainable, Etc.] with respect to any
Loan to which a Euro-Rate Option applies.
Whenever the Borrower desires to prepay any part of the
Loans, it shall provide a prepayment notice to the Agent by 1:00 p.m. at least
one (1) Business Day prior to the date of prepayment of Loans setting forth the
following information:
(x) the date, which shall be a Business Day, on which the
proposed prepayment is to be made;
(y) a statement indicating the application of the
prepayment between the Loans; and
(z) the total principal amount of such prepayment, which
shall not be less than the lesser of $500,000 for any Swing Loan or
Revolving Credit Loan or the remaining amount outstanding.
All prepayment notices shall be irrevocable. The principal
amount of the Loans for which a prepayment notice is given, together with
interest on such principal amount except with respect to Revolving Credit Loans
to which the Base Rate Option applies, shall be due and payable on the date
specified in such prepayment notice as the date on which the proposed prepayment
is to be made. Except as provided in Section 3.4.3 [Agent's and Bank's rights],
if the Borrower prepays a Loan but fails to specify the applicable Borrowing
Tranche which the Borrower is prepaying, the prepayment shall be applied first
to Loans to which the Base Rate Option applies, then to Loans to which the
Euro-Rate Option applies. Any prepayment hereunder shall be subject to the
Borrower's Obligation to indemnify the Banks under Section 4.6.2 [Indemnity].
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4.4.2. REPLACEMENT OF A BANK.
In the event any Bank (i) gives notice under Section 3.4
[Euro-Rate Unascertainable, Etc.] or Section 4.6.1 [Increased Costs, Etc.], (ii)
does not fund Loans because the making of such Loans would contravene any Law
applicable to such Bank, or (iii) becomes subject to the control of an Official
Body (other than normal and customary supervision), then the Borrower shall have
the right at its option, with the consent of the Agent, which shall not be
unreasonably withheld, conditioned or delayed, to prepay the Loans of such Bank
in whole, together with all interest accrued thereon, and terminate such Bank's
Commitments within ninety (90) days after (x) receipt of such Bank's notice
under Section 3.4 [Euro-Rate Unascertainable, Etc.] or 4.6.1 [Increased Costs,
Etc.], (y) the date such Bank has failed to fund Loans because the making of
such Loans would contravene Law applicable to such Bank, or (z) the date such
Bank became subject to the control of an Official Body, as applicable; PROVIDED
that the Borrower shall also pay to such Bank at the time of such prepayment any
amounts required under Section 4.6 [Additional Compensation in Certain
Circumstances] and any accrued interest due on such amount and any related fees;
PROVIDED, however, that the Commitments of such Bank shall be provided by one or
more of the remaining Banks or a replacement bank acceptable to the Agent;
PROVIDED, further, the remaining Banks shall have no obligation hereunder to
increase their Commitments. Notwithstanding the foregoing, the Agent may only be
replaced subject to the requirements of Section 9.14 [Successor Agent] and
PROVIDED that all Letters of Credit have expired or been terminated or replaced.
4.4.3. CHANGE OF LENDING OFFICE.
Each Bank agrees that upon the occurrence of any event
giving rise to increased costs or other special payments under Section 3.4.2
[Illegality, Etc.] or 4.6.1 [Increased Costs, Etc.] with respect to such Bank,
it will if requested by the Borrower, use reasonable efforts (subject to overall
policy considerations of such Bank) to designate another lending office for any
Loans or Letters of Credit affected by such event, PROVIDED that such
designation is made on such terms that such Bank and its lending office suffer
no material economic, legal or regulatory disadvantage, with the object of
avoiding the consequence of the event giving rise to the operation of such
Section. Nothing in this Section 4.4.3 shall affect or postpone any of the
Obligations of the Borrower or any other Loan Party or the rights of the Agent
or any Bank provided in this Agreement.
4.5 MANDATORY PREPAYMENTS.
4.5.1. SALE OF ASSETS; RECEIPT OF INSURANCE PROCEEDS.
Within ten (10) Business Days of any sale by the Borrower of
assets which requires a mandatory prepayment of the Loans under Section
7.2.7(vii) [Disposition of Assets or Subsidiaries or any receipt by the Borrower
of insurance proceeds receivable by the Agent described in Section 7.1.3, the
Borrower shall make a mandatory prepayment (the "Mandatory Prepayment Amount")
of principal on the Revolving Credit Loans equal to the after-tax proceeds
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of such sale (as estimated in good faith by the Borrower) in the case of a
disposition of assets or equal to the amount of proceeds received in the case of
a receipt of insurance proceeds, together with accrued interest on such
principal amount.
4.5.2. APPLICATION AMONG INTEREST RATE OPTIONS.
All prepayments required pursuant to this Section 4.5 shall
first be applied among the Interest Rate Options to the principal amount of the
Revolving Credit Loans subject to the Base Rate Option, then to Revolving Credit
Loans subject to a Euro-Rate Option, then to Swing Loans. In accordance with
Section 4.6.2 [Indemnity], the Borrower shall indemnify the Banks for any loss
or expense, including loss of margin, incurred with respect to any such
prepayments applied against Loans subject to a Euro-Rate Option on any day other
than the last day of the applicable Revolving Credit Interest Period.
4.6 ADDITIONAL COMPENSATION IN CERTAIN CIRCUMSTANCES.
4.6.1. INCREASED COSTS OR REDUCED RETURN RESULTING FROM TAXES,
RESERVES, CAPITAL ADEQUACY REQUIREMENTS, EXPENSES, ETC.
If after the Closing Date any Law, guideline or
interpretation or any change in any Law, guideline or interpretation or
application thereof by any Official Body charged with the interpretation or
administration thereof or compliance with any request or directive (whether or
not having the force of Law) of any central bank or other Official Body:
(i) subjects any Bank to any tax or changes the basis
of taxation with respect to this Agreement, the Notes, the Loans or payments by
the Borrower of principal, interest, Revolving Credit Commitment Fees, or other
amounts due from the Borrower hereunder or under the Notes (except for taxes on
the overall net income of such Bank),
(ii) imposes, modifies or deems applicable any
reserve, special deposit or similar requirement against credits or commitments
to extend credit extended by, or assets (funded or contingent) of, deposits with
or for the account of, or other acquisitions of funds by, any Bank, or
(iii) imposes, modifies or deems applicable any
capital adequacy or similar requirement (A) against assets (funded or
contingent) of, or letters of credit, other credits or commitments to extend
credit extended by, any Bank, or (B) otherwise applicable to the obligations of
any Bank under this Agreement,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Bank with respect to this Agreement, the Notes or the making, maintenance or
funding of any part of the Loans (or, in the case of any capital adequacy or
similar requirement, to have the effect of reducing the rate of return on any
Bank's capital, taking into consideration such Bank's customary policies with
respect to capital adequacy) by an amount which such Bank in its sole discretion
deems to be material, such Bank
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shall from time to time notify the Borrower and the Agent of the amount
determined in good faith (using any averaging and attribution methods employed
in good faith) by such Bank to be necessary to compensate such Bank for such
increase in cost, reduction of income, additional expense or reduced rate of
return. Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower to such Bank
ten (10) Business Days after such notice is given.
4.6.2. INDEMNITY.
In addition to the compensation required by Section 4.6.1
[Increased Costs, Etc.], the Borrower shall indemnify each Bank against all
liabilities, losses or expenses (including loss of margin, any loss or expense
incurred in liquidating or employing deposits from third parties and any loss or
expense incurred in connection with funds acquired by a Bank to fund or maintain
Loans subject to a Euro-Rate Option) which such Bank sustains or incurs as a
consequence of any
(i) payment, prepayment, conversion or renewal of any
Revolving Credit Loan to which a Euro-Rate Option applies or any Swing Loan on a
day other than the last day of the corresponding Interest Period (whether or not
such payment or prepayment is mandatory, voluntary or automatic and whether or
not such payment or prepayment is then due),
(ii) attempt by the Borrower to revoke (expressly, by
later inconsistent notices or otherwise) in whole or part any Loan Requests
under Section 2.4 [Loan Requests] or Section 3.2 [Interest Periods] or notice
relating to prepayments under Section 4.4 [Voluntary Prepayments], or
(iii) default by the Borrower in the performance or
observance of any covenant or condition contained in this Agreement or any other
Loan Document, including any failure of the Borrower to pay when due (by
acceleration or otherwise) any principal, interest, Revolving Credit Commitment
Fees or any other amount due hereunder.
If any Bank sustains or incurs any such loss or expense, it
shall from time to time notify the Borrower of the amount determined in good
faith by such Bank (which determination may include such assumptions,
allocations of costs and expenses and averaging or attribution methods as such
Bank shall deem reasonable) to be necessary to indemnify such Bank for such loss
or expense. Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower to such Bank
ten (10) Business Days after such notice is given.
4.7 SETTLEMENT DATE PROCEDURES.
In order to minimize the transfer of funds between the Banks and
the Agent, the Borrower may borrow, repay and borrow again Swing Loans and PNC
Bank may make Swing
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Loans as provided in Section 2.1.2 hereof. Not later than 11:00 a.m., Pittsburgh
time, on any Business Day (each a "Settlement Date"), the Agent may at its
option for any reason notify each Bank of its Ratable Share of the total of the
Swing Loans. Prior to 2:00 p.m., Pittsburgh time, on such Settlement Date, each
Bank shall pay to the Agent an amount equal to, and shall purchase, its Ratable
Share of the outstanding Swing Loans. These settlement procedures are
established solely as a matter of administrative convenience, and nothing
contained in this Section 4.7 shall relieve the Banks of their obligations to
fund Revolving Credit Loans.
5. REPRESENTATIONS AND WARRANTIES
5.1 REPRESENTATIONS AND WARRANTIES.
The Loan Parties, jointly and severally, represent and warrant
to the Agent and each of the Banks as follows:
5.1.1. ORGANIZATION AND QUALIFICATION.
Each Loan Party and each Subsidiary of each Loan Party is a
corporation, partnership or limited liability company duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization. Each Loan Party and each Subsidiary of each Loan Party has the
lawful power to own or lease its properties and to engage in the business it
presently conducts or proposes to conduct. Each Loan Party and each Subsidiary
of each Loan Party is duly licensed or qualified and in good standing in each
jurisdiction listed on SCHEDULE 5.1.1 and in all other jurisdictions where the
property owned or leased by it or the nature of the business transacted by it or
both makes such licensing or qualification necessary.
5.1.2. CAPITALIZATION AND OWNERSHIP.
The authorized capital stock of the Borrower consists of
common stock without nominal or par value, of which 7,969,544 shares (referred
to herein as the "Shares") were issued and outstanding as of November 12, 2001.
All of the Shares have been validly issued and are fully paid and nonassessable.
There are no options, warrants or other rights outstanding to purchase any such
shares except as indicated on SCHEDULE 5.1.2.
5.1.3. SUBSIDIARIES.
SCHEDULE 5.1.3 states the name of each of the Borrower's
Subsidiaries, its jurisdiction of incorporation, its authorized capital stock,
the issued and outstanding shares (referred to herein as the "Subsidiary
Shares") and the owners thereof if it is a corporation, its outstanding
partnership interests (the "Partnership Interests") if it is a partnership and
its outstanding limited liability company interests, interests assigned to
managers thereof and the voting rights associated therewith (the "LLC
Interests") if it is a limited liability company. The Borrower and each
Subsidiary of the Borrower has good and marketable title to all of the
Subsidiary Shares, Partnership Interests and LLC Interests it purports to own,
free and clear in
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each case of any Lien. All Subsidiary Shares, Partnership Interests and LLC
Interests have been validly issued, and all Subsidiary Shares are fully paid and
nonassessable. All capital contributions and other consideration required to be
made or paid in connection with the issuance of the Partnership Interests and
LLC Interests have been made or paid, as the case may be. There are no options,
warrants or other rights outstanding to purchase any such Subsidiary Shares,
Partnership Interests or LLC Interests except as indicated on SCHEDULE 5.1.3.
5.1.4. POWER AND AUTHORITY.
Each Loan Party has full power to enter into, execute,
deliver and carry out this Agreement and the other Loan Documents to which it is
a party, to incur the Indebtedness contemplated by the Loan Documents and to
perform its Obligations under the Loan Documents to which it is a party, and all
such actions have been duly authorized by all necessary proceedings on its part.
5.1.5. VALIDITY AND BINDING EFFECT.
This Agreement has been duly and validly executed and
delivered by each Loan Party, and each other Loan Document which any Loan Party
is required to execute and deliver on or after the date hereof will have been
duly executed and delivered by such Loan Party on the required date of delivery
of such Loan Document. This Agreement and each other Loan Document constitutes,
or will constitute, legal, valid and binding obligations of each Loan Party
which is or will be a party thereto on and after its date of delivery thereof,
enforceable against such Loan Party in accordance with its terms, except to the
extent that enforceability of any of such Loan Document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforceability of creditors' rights generally or limiting the
right of specific performance.
5.1.6. NO CONFLICT.
Neither the execution and delivery of this Agreement or the
other Loan Documents by any Loan Party nor the consummation of the transactions
herein or therein contemplated or compliance with the terms and provisions
hereof or thereof by any of them will conflict with, constitute a default under
or result in any breach of (i) the terms and conditions of the certificate of
incorporation, bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, limited liability company agreement or
other organizational documents of any Loan Party or (ii) any Law or any material
agreement or instrument or order, writ, judgment, injunction or decree to which
any Loan Party or any of its Subsidiaries is a party or by which it or any of
its Subsidiaries is bound or to which it is subject, or result in the creation
or enforcement of any Lien, charge or encumbrance whatsoever upon any property
(now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other
than Liens granted under the Loan Documents).
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5.1.7. LITIGATION.
Except as disclosed on Schedule 5.1.7, there are no material
actions, suits, proceedings or investigations pending or, to the knowledge of
any Loan Party, threatened against such Loan Party or any Subsidiary of such
Loan Party at law or equity before any Official Body provided that such items
disclosed on such Schedule, could not reasonably be expected to individually or
in the aggregate result in any Material Adverse Change. None of the Loan Parties
or any Subsidiaries of any Loan Party is in violation of any order, writ,
injunction or any decree of any Official Body which may result in any Material
Adverse Change.
5.1.8. TITLE TO PROPERTIES.
The real property owned or leased by each Loan Party and
each Subsidiary of each Loan Party is described on SCHEDULE 5.1.8. Each Loan
Party and each Subsidiary of each Loan Party has good and marketable title to or
valid leasehold interest in all properties, assets and other rights which it
purports to own or lease or which are reflected as owned or leased on its books
and records, free and clear of all Liens and encumbrances except Permitted
Liens, and subject to the terms and conditions of the applicable leases. All
leases of property are in full force and effect without the necessity for any
consent which has not previously been obtained upon consummation of the
transactions contemplated hereby.
5.1.9. FINANCIAL STATEMENTS.
(i) HISTORICAL STATEMENTS. The Borrower has delivered
to the Agent copies of its audited consolidated year-end financial statements
for and as of the end of the three (3) fiscal years ended December 31, 2000 (the
"Annual Statements"). In addition, the Borrower has delivered to the Agent
copies of its unaudited consolidated interim financial statements for the fiscal
year to date and as of the end of the fiscal quarter ended September 30, 2001
(the "Interim Statements") (the Annual and Interim Statements being collectively
referred to as the "Historical Statements"). The Historical Statements were
compiled from the books and records maintained by the Borrower's management, are
correct and complete and fairly represent the consolidated financial condition
of the Borrower and its Subsidiaries as of their dates and the results of
operations for the fiscal periods then ended and have been prepared in
accordance with GAAP consistently applied, subject (in the case of the Interim
Statements) to normal year-end audit adjustments.
(ii) FINANCIAL PROJECTIONS. The Borrower has
delivered to the Agent financial projections of the Borrower and its
Subsidiaries for the period 2001 through 2003 derived from various assumptions
of the Borrower's management (the "Financial Projections"). The Financial
Projections represent a reasonable range of possible results in light of the
history of the business, present and foreseeable conditions and the intentions
of the Borrower's management. The Financial Projections accurately reflect the
liabilities of the Borrower and its Subsidiaries upon consummation of the
transactions contemplated hereby as of the Closing Date.
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(iii) ACCURACY OF FINANCIAL STATEMENTS. Neither the
Borrower nor any Subsidiary of the Borrower has any liabilities, contingent or
otherwise, or forward or long-term commitments that are not disclosed in the
Historical Statements or in the notes thereto, and except as disclosed therein
there are no unrealized or anticipated losses from any commitments of the
Borrower or any Subsidiary of the Borrower which may cause a Material Adverse
Change. Since December 31, 2000, no Material Adverse Change has occurred.
5.1.10. USE OF PROCEEDS; MARGIN STOCK; SECTION 20 SUBSIDIARIES.
5.1.10.1 GENERAL.
The Loan Parties intend to use the proceeds of the Loans in
accordance with Sections 2.7 and 7.1.10.
5.1.10.2 MARGIN STOCK.
None of the Loan Parties or any Subsidiaries of any Loan
Party engages or intends to engage principally, or as one of its important
activities, in the business of extending credit for the purpose, immediately,
incidentally or ultimately, of purchasing or carrying margin stock (within the
meaning of Regulation U). No part of the proceeds of any Loan has been or will
be used, immediately, incidentally or ultimately, to purchase or carry any
margin stock or to extend credit to others for the purpose of purchasing or
carrying any margin stock or to refund Indebtedness originally incurred for such
purpose, or for any purpose which entails a violation of or which is
inconsistent with the provisions of the regulations of the Board of Governors of
the Federal Reserve System. None of the Loan Parties or any Subsidiary of any
Loan Party holds or intends to hold margin stock in such amounts that more than
25% of the reasonable value of the assets of any Loan Party or Subsidiary of any
Loan Party are or will be represented by margin stock.
5.1.10.3 SECTION 20 SUBSIDIARIES.
The Loan Parties do not intend to use and shall not use any
portion of the proceeds of the Loans, directly or indirectly, to purchase during
the underwriting period, or for thirty (30) days thereafter, Ineligible
Securities being underwritten by a Section 20 Subsidiary.
5.1.11. FULL DISCLOSURE.
Neither this Agreement nor any other Loan Document, nor any
certificate, statement, agreement or other documents furnished to the Agent or
any Bank in connection herewith or therewith, contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which they were made, not misleading. There is no fact known to any Loan Party
which materially adversely affects the business, property, assets, financial
condition, results of operations or prospects of any Loan Party or Subsidiary of
any Loan Party which has not been
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set forth in this Agreement or in the certificates, statements, agreements or
other documents furnished in writing to the Agent and the Banks prior to or at
the date hereof in connection with the transactions contemplated hereby.
5.1.12. TAXES.
All federal, state, local and other tax returns required to
have been filed with respect to each Loan Party and each Subsidiary of each Loan
Party have been filed, and payment or adequate provision has been made for the
payment of all taxes, fees, assessments and other governmental charges which
have or may become due pursuant to said returns or to assessments received,
except to the extent that such taxes, fees, assessments and other charges are
being contested in good faith by appropriate proceedings diligently conducted
and for which such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made. There are no agreements or waivers
extending the statutory period of limitations applicable to any federal income
tax return of any Loan Party or Subsidiary of any Loan Party for any period.
5.1.13. CONSENTS AND APPROVALS.
Except for the filing of financing statements in the state
and county filing offices and the filing with the Securities and Exchange
Commission and American Stock Exchange after the Closing Date, no consent,
approval, exemption, order or authorization of, or a registration or filing
with, any Official Body or any other Person is required by any Law or any
agreement in connection with the execution, delivery and carrying out of this
Agreement and the other Loan Documents by any Loan Party, except as listed on
SCHEDULE 5.1.13, all of which shall have been obtained or made on or prior to
the Closing Date except as otherwise indicated on SCHEDULE 5.1.13.
5.1.14. NO EVENT OF DEFAULT; COMPLIANCE WITH INSTRUMENTS.
No event has occurred and is continuing and no condition
exists or will exist after giving effect to the borrowings or other extensions
of credit to be made on the Closing Date under or pursuant to the Loan Documents
which constitutes an Event of Default or Potential Default. None of the Loan
Parties or any Subsidiaries of any Loan Party is in violation of (i) any term of
its certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited liability company
agreement or other organizational documents or (ii) any material agreement or
instrument to which it is a party or by which it or any of its properties may be
subject or bound where such violation would constitute a Material Adverse
Change.
5.1.15. PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, ETC.
Each Loan Party and each Subsidiary of each Loan Party owns
or possesses all the material patents, trademarks, service marks, trade names,
copyrights, licenses,
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registrations, franchises, permits and rights necessary to own and operate its
properties and to carry on its business as presently conducted and planned to be
conducted by such Loan Party or Subsidiary, without known possible, alleged or
actual conflict with the rights of others. All material patents, trademarks,
service marks, trade names, copyrights, licenses, registrations, franchises and
permits of each Loan Party and each Subsidiary of each Loan Party are listed and
described on SCHEDULE 5.1.15.
5.1.16. SECURITY INTERESTS.
The Liens and security interests granted to the Agent for
the benefit of the Banks pursuant to the Patent, Trademark and Copyright
Assignment, the Pledge Agreement and the Security Agreement in the Collateral
constitute and will continue to constitute Prior Security Interests under the
Uniform Commercial Code as in effect in each applicable jurisdiction (the
"Uniform Commercial Code") or other applicable Law entitled to all the rights,
benefits and priorities provided by the Uniform Commercial Code or such Law.
Upon the filing of financing statements relating to said security interests in
each office and in each jurisdiction where required in order to perfect the
security interests described above, taking possession of any stock certificates
or other certificates evidencing the Pledged Collateral and recordation of the
Patent, Trademark and Copyright Assignment in the United States Patent and
Trademark Office and United States Copyright Office, as applicable, all such
action as is necessary or advisable to establish such rights of the Agent will
have been taken, and there will be upon execution and delivery of the Patent,
Trademark and Copyright Assignment, the Pledge Agreement and the Security
Agreement, such filings and such taking of possession, no necessity for any
further action in order to preserve, protect and continue such rights, except
the filing of continuation statements with respect to such financing statements
within six months prior to each five-year anniversary of the filing of such
financing statements. All filing fees and other expenses in connection with each
such action have been or will be paid by the Borrower.
5.1.17. STATUS OF THE PLEDGED COLLATERAL.
All the shares of capital stock, Partnership Interests or
LLC Interests included in the Pledged Collateral to be pledged pursuant to the
Pledge Agreement are or will be upon issuance validly issued and nonassessable
and owned beneficially and of record by the pledgor free and clear of any Lien
or restriction on transfer, except as otherwise provided by the Pledge Agreement
and except as the right of the Banks to dispose of the Shares, Partnership
Interests or LLC Interests may be limited by the Securities Act of 1933, as
amended, and the regulations promulgated by the Securities and Exchange
Commission thereunder and by applicable state securities laws. Except as
disclosed on Schedule 5.1.17, there are no shareholder, partnership, limited
liability company or other agreements or understandings with respect to the
shares of capital stock, Partnership Interests or LLC Interests included in the
Pledged Collateral. The Loan Parties have delivered true and correct copies of
such partnership agreements and limited liability company agreements to the
Agent.
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5.1.18. INSURANCE.
SCHEDULE 5.1.18 lists all insurance policies and other
bonds to which any Loan Party or Subsidiary of any Loan Party is a party, all of
which are valid and in full force and effect. No notice has been given or claim
made and no grounds exist to cancel or avoid any of such policies or bonds or to
reduce the coverage provided thereby. Such policies and bonds provide adequate
coverage from reputable and financially sound insurers in amounts sufficient to
insure the assets and risks of each Loan Party and each Subsidiary of each Loan
Party in accordance with prudent business practice in the industry of the Loan
Parties and their Subsidiaries.
5.1.19. COMPLIANCE WITH LAWS.
The Loan Parties and their Subsidiaries are in compliance
in all material respects with all applicable Laws (other than Environmental Laws
which are specifically addressed in Section 5.1.24 [Environmental Matters]) in
all jurisdictions in which any Loan Party or Subsidiary of any Loan Party is
presently or will be doing business except where the failure to do so would not
constitute a Material Adverse Change.
5.1.20. MATERIAL CONTRACTS; BURDENSOME RESTRICTIONS.
SCHEDULE 5.1.20 lists all material contracts relating to
the business operations of each Loan Party and each Subsidiary of any Loan
Party, including all employee benefit plans and Labor Contracts. All such
material contracts are valid, binding and enforceable upon such Loan Party or
Subsidiary and each of the other parties thereto in accordance with their
respective terms, and there is no default thereunder, to the Loan Parties'
knowledge, with respect to parties other than such Loan Party or Subsidiary. To
their knowledge, none of the Loan Parties or their Subsidiaries is bound by any
contractual obligation, or subject to any restriction in any organization
document, or any requirement of Law which could result in a Material Adverse
Change.
5.1.21. INVESTMENT COMPANIES; REGULATED ENTITIES.
None of the Loan Parties or any Subsidiaries of any Loan
Party is an "investment company" registered or required to be registered under
the Investment Company Act of 1940 or under the "control" of an "investment
company" as such terms are defined in the Investment Company Act of 1940 and
shall not become such an "investment company" or under such "control." None of
the Loan Parties or any Subsidiaries of any Loan Party is subject to any other
Federal or state statute or regulation limiting its ability to incur
Indebtedness for borrowed money.
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5.1.22. PLANS AND BENEFIT ARRANGEMENTS.
Except as set forth on SCHEDULE 5.1.22:
(i) The Borrower and each other member of the
ERISA Group are in compliance in all material respects with any applicable
provisions of ERISA with respect to all Benefit Arrangements, Plans and
Multiemployer Plans. There has been no Prohibited Transaction with respect to
any Benefit Arrangement or any Plan or, to the best knowledge of the Borrower,
with respect to any Multiemployer Plan or Multiple Employer Plan, which could
result in any material liability of the Borrower or any other member of the
ERISA Group. The Borrower and all other members of the ERISA Group have made
when due any and all payments required to be made under any agreement relating
to a Multiemployer Plan or a Multiple Employer Plan or any Law pertaining
thereto. With respect to each Plan and Multiemployer Plan, the Borrower and each
other member of the ERISA Group (i) have fulfilled in all material respects
their obligations under the minimum funding standards of ERISA, (ii) have not
incurred any liability to the PBGC, and (iii) have not had asserted against them
any penalty for failure to fulfill the minimum funding requirements of ERISA.
(ii) To the best of the Borrower's knowledge,
each Multiemployer Plan and Multiple Employer Plan is able to pay benefits
thereunder when due.
(iii) Neither the Borrower nor any other member
of the ERISA Group has instituted or intends to institute proceedings to
terminate any Plan.
(iv) No event requiring notice to the PBGC under
Section 302(f)(4)(A) of ERISA has occurred or is reasonably expected to occur
with respect to any Plan, and no amendment with respect to which security is
required under Section 307 of ERISA has been made or is reasonably expected to
be made to any Plan.
(v) The aggregate actuarial present value of all
benefit liabilities (whether or not vested) under each Plan, determined on a
plan termination basis, as disclosed in, and as of the date of, the most recent
actuarial report for such Plan, does not exceed the aggregate fair market value
of the assets of such Plan.
(vi) Neither the Borrower nor any other member of
the ERISA Group has incurred or reasonably expects to incur any material
withdrawal liability under ERISA to any Multiemployer Plan or Multiple Employer
Plan. Neither the Borrower nor any other member of the ERISA Group has been
notified by any Multiemployer Plan or Multiple Employer Plan that such
Multiemployer Plan or Multiple Employer Plan has been terminated within the
meaning of Title IV of ERISA and, to the best knowledge of the Borrower, no
Multiemployer Plan or Multiple Employer Plan is reasonably expected to be
reorganized or terminated, within the meaning of Title IV of ERISA.
(vii) To the extent that any Benefit Arrangement
is insured, the Borrower and all other members of the ERISA Group have paid when
due all premiums required to be paid for all periods through the Closing Date.
To the extent that any Benefit Arrangement is funded other than with insurance,
the Borrower and all other members of
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the ERISA Group have made when due all contributions required to be paid for all
periods through the Closing Date.
(viii) All Plans, Benefit Arrangements and
Multiemployer Plans have been administered in accordance with their terms and
applicable Law.
5.1.23. EMPLOYMENT MATTERS.
Each of the Loan Parties and each of their Subsidiaries is
in compliance with the Labor Contracts and all applicable federal, state and
local labor and employment Laws including those related to equal employment
opportunity and affirmative action, labor relations, minimum wage, overtime,
child labor, medical insurance continuation, worker adjustment and relocation
notices, immigration controls and worker and unemployment compensation, where
the failure to comply would constitute a Material Adverse Change. There are no
outstanding grievances, arbitration awards or appeals therefrom arising out of
the Labor Contracts or current or threatened strikes, picketing, handbilling or
other work stoppages or slowdowns at facilities of any of the Loan Parties or
any of their Subsidiaries which in any case would constitute a Material Adverse
Change. The Borrower has delivered to the Agent true and correct copies of each
of the Labor Contracts, if any.
5.1.24. ENVIRONMENTAL MATTERS.
Except as disclosed on SCHEDULE 5.1.24:
(i) None of the Loan Parties has received any
Environmental Complaint, whether directed or issued to any Loan Party or
relating or pertaining to any prior owner, operator or occupant of the Property,
and has no reason to believe that it might receive an Environmental Complaint.
(ii) No activity of any Loan Party at the
Property is being or has been conducted in violation of any Environmental Law or
Required Environmental Permit and to the knowledge of any Loan Party no activity
of any prior owner, operator or occupant of the Property was conducted in
violation of any Environmental Law.
(iii) To the Loan Parties' knowledge, there are
no Regulated Substances present on, in, under, or emanating from or to the
Property or any portion thereof which result in Contamination.
(iv) Each Loan Party has all Required
Environmental Permits and all such Required Environmental Permits are in full
force and effect.
(v) Each Loan Party has submitted to an Official
Body and/or maintains, as appropriate, all Required Environmental Notices.
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(vi) No structures, improvements, equipment,
fixtures, impoundments, pits, lagoons or aboveground or underground storage
tanks located on the Property contain or use, except in compliance with
Environmental Laws and Required Environmental Permits, Regulated Substances or
otherwise are operated or maintained except in compliance with Environmental
Laws and Required Environmental Permits. To the knowledge of each Loan Party, no
structures, improvements, equipment, fixtures, impoundments, pits, lagoons or
aboveground or underground storage tanks of prior owners, operators or occupants
of the Property contained or used, except in compliance with Environmental Laws,
Regulated Substances or otherwise were operated or maintained by any such prior
owner, operator or occupant except in compliance with Environmental Laws.
(vii) To the knowledge of each Loan Party, no
facility or site to which any Loan Party, either directly or indirectly by a
third party, has sent Regulated Substances for storage, treatment, disposal or
other management has been or is being operated in violation of Environmental
Laws or pursuant to Environmental Laws is identified or proposed to be
identified on any list of contaminated properties or other properties which
pursuant to Environmental Laws are the subject of an investigation, cleanup,
removal, remediation or other response action by an Official Body.
(viii) No portion of the Property is identified
or to the knowledge of any Loan Party proposed to be identified on any list of
contaminated properties or other properties which pursuant to Environmental Laws
are the subject of an investigation or remediation action by an Official Body,
nor to the knowledge of any Loan Party is any property adjoining or in the
proximity of the Property identified or proposed to be identified on any such
list.
(ix) No portion of the Property constitutes an
Environmentally Sensitive Area.
(x) No lien or other encumbrance authorized by
Environmental Laws exists against the Property and none of the Loan Parties has
any reason to believe that such a lien or encumbrance may be imposed.
5.1.25. SENIOR DEBT STATUS.
The Obligations of each Loan Party under this Agreement,
the Notes, the Guaranty Agreement and each of the other Loan Documents to which
it is a party do rank and will rank at least PARI PASSU in priority of payment
with all other Indebtedness of such Loan Party except Indebtedness of such Loan
Party to the extent secured by Permitted Liens. There is no Lien upon or with
respect to any of the properties or income of any Loan Party or Subsidiary of
any Loan Party which secures indebtedness or other obligations of any Person
except for Permitted Liens.
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5.1.26. SOLVENCY.
Each of the Loan Parties is Solvent. After giving effect to
the transactions contemplated by the Loan Documents, including all Indebtedness
incurred thereby, the Liens granted by the Borrower in connection therewith and
the payment of all fees related thereto, each of the Loan Parties will be
Solvent, determined as of the Closing Date.
5.2 UPDATES TO SCHEDULES.
Should any of the information or disclosures on any of the
following Schedules attached hereto be outdated or incorrect in any material
respect as of the date on which Borrower delivers its Compliance Certificates
pursuant to Section 7.3.3, Borrower shall deliver an amended and restated form
of such Schedule together with such Compliance Certificate:
Schedule 5.1.1 - Qualifications To Do Business
Schedule 5.1.2 - Capitalization
Schedule 5.1.17 - Insurance Policies
Schedule 5.1.20 - Material Contracts
Should any of the information or disclosures provided on any of
the following Schedules attached hereto become outdated or incorrect in any
material respect, the Borrower shall promptly provide the Agent in writing with
such revisions or updates to such Schedule as may be necessary or appropriate to
update or correct same; PROVIDED, however, that no Schedule shall be deemed to
have been amended, modified or superseded by any such correction or update, nor
shall any breach of warranty or representation resulting from the inaccuracy or
incompleteness of any such Schedule be deemed to have been cured thereby, unless
and until the Required Banks, in their sole and absolute discretion, shall have
accepted in writing such revisions or updates to such Schedule.
Schedule 5.1.3 - Subsidiaries
Schedule 5.1.7 - Litigation
Schedule 5.1.8 - Owned And Leased Real Property
Schedule 5.1.13 - Consents And Approvals
Schedule 5.1.15 - Patents, Trademarks, Copyrights,
Licenses, Etc.
Schedule 5.1.17 - Partnership Agreements; LLC Agreements
Schedule 5.1.22 - Employee Benefit Plan Disclosures
Schedule 5.1.24 - Environmental Disclosures
6. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
The obligation of each Bank to make Loans and of the Agent to issue
Letters of Credit hereunder is subject to the performance by each of the Loan
Parties of its Obligations to be performed hereunder at or prior to the making
of any such Loans or issuance of such Letters of Credit and to the satisfaction
of the following further conditions:
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6.1 FIRST LOANS AND LETTERS OF CREDIT.
On the Closing Date:
6.1.1. OFFICER'S CERTIFICATE.
The representations and warranties of each of the Loan
Parties contained in Section 5.1 and in each of the other Loan Documents shall
be true and accurate on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of such date
(except representations and warranties which relate solely to an earlier date or
time, which representations and warranties shall be true and correct on and as
of the specific dates or times referred to therein), and each of the Loan
Parties shall have performed and complied with all covenants and conditions
hereof and thereof, no Event of Default or Potential Default shall have occurred
and be continuing or shall exist; and there shall be delivered to the Agent for
the benefit of each Bank a certificate of each of the Loan Parties, dated the
Closing Date and signed by the Chief Executive Officer, President or Chief
Financial Officer of each of the Loan Parties, to each such effect.
6.1.2. SECRETARY'S CERTIFICATE.
There shall be delivered to the Agent for the benefit of
each Bank a certificate dated the Closing Date and signed by the Secretary or an
Assistant Secretary of each of the Loan Parties, certifying as appropriate as
to:
(i) all action taken by each Loan Party in
connection with this Agreement and the other Loan Documents;
(ii) the names of the officer or officers
authorized to sign this Agreement and the other Loan Documents and the true
signatures of such officer or officers and specifying the Authorized Officers
permitted to act on behalf of each Loan Party for purposes of this Agreement and
the true signatures of such officers, on which the Agent and each Bank may
conclusively rely; and
(iii) copies of its organizational documents,
including its certificate of incorporation, bylaws, certificate of limited
partnership, partnership agreement, certificate of formation, and limited
liability company agreement as in effect on the Closing Date certified by the
appropriate state official where such documents are filed in a state office
together with certificates from the appropriate state officials as to the
continued existence and good standing of each Loan Party in each state where
organized or qualified to do business.
6.1.3. DELIVERY OF LOAN DOCUMENTS.
The Guaranty Agreement, Notes, Intercompany Subordination
Agreement the Patent, Trademark and Copyright Assignment, the Pledge Agreement
and Security Agreement shall have been duly executed and delivered to the Agent
for the benefit of the Banks,
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together with all appropriate financing statements and appropriate stock powers
and certificates evidencing the Shares, the Partnership Interests and the LLC
Interests.
6.1.4. OPINION OF COUNSEL.
There shall be delivered to the Agent for the benefit of
each Bank a written opinion of Xxxxxx Xxxxx LLP, counsel for the Loan Parties
(who may rely on the opinions of such other counsel as may be acceptable to the
Agent), dated the Closing Date and in form and substance satisfactory to the
Agent and its counsel:
(i) as to the matters set forth in EXHIBIT 6.1.4;
and
(ii) as to such other matters incident to the
transactions contemplated herein as the Agent may reasonably request.
6.1.5. LEGAL DETAILS.
All legal details and proceedings in connection with the
transactions contemplated by this Agreement and the other Loan Documents shall
be in form and substance satisfactory to the Agent and counsel for the Agent,
and the Agent shall have received all such other counterpart originals or
certified or other copies of such documents and proceedings in connection with
such transactions, in form and substance satisfactory to the Agent and said
counsel, as the Agent or said counsel may reasonably request.
6.1.6. PAYMENT OF FEES.
The Borrower shall have paid or caused to be paid to the
Agent for itself and for the account of the Banks to the extent not previously
paid all fees accrued through the Closing Date and the costs and expenses for
which the Agent and the Banks are entitled to be reimbursed.
6.1.7. FIRST UNION CREDIT FACILITY.
The Borrower shall have delivered satisfactory
confirmation that First Union National Bank acknowledges the transactions under
this Agreement.
6.1.8. CONSENTS.
All material consents required to effectuate the
transactions contemplated hereby as set forth on SCHEDULE 5.1.13 shall
have been obtained.
6.1.9. OFFICER'S CERTIFICATE REGARDING MACS.
Since December 31, 2000, no Material Adverse Change shall
have occurred; there shall have been no material change in the management of any
Loan Party or
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Subsidiary of any Loan Party; and there shall have been delivered to the Agent
for the benefit of each Bank a certificate dated the Closing Date and signed by
the Chief Executive Officer, President or Chief Financial Officer of each Loan
Party to each such effect.
6.1.10. NO VIOLATION OF LAWS.
The making of the Loans and the issuance of the Letters
of Credit shall not contravene any Law applicable to any Loan Party or any of
the Banks.
6.1.11. NO ACTIONS OR PROCEEDINGS.
No action, proceeding, investigation, regulation or
legislation shall have been instituted, threatened or proposed before any court,
governmental agency or legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, this Agreement, the other Loan Documents or the
consummation of the transactions contemplated hereby or thereby or which, in the
Agent's sole discretion, would make it inadvisable to consummate the
transactions contemplated by this Agreement or any of the other Loan Documents.
6.1.12. INSURANCE POLICIES; CERTIFICATES OF INSURANCE;
ENDORSEMENTS.
The Loan Parties shall have delivered certificates of
insurance and other evidence acceptable to the Agent that adequate insurance in
compliance with Section 7.1.3 [Maintenance of Insurance] is in full force and
effect and that all premiums then due thereon have been paid, together with
copies of additional insured, mortgagee and lender loss payable special
endorsements relating to each Loan Party's casualty insurance policy or policies
thereto in form and substance satisfactory to the Agent and its counsel naming
the Agent as additional insured, mortgagee and lender loss payee.
6.1.13. LIEN SEARCHES
The Agent shall have received satisfactory results of a
Lien search demonstrating that the Agent's Lien constitutes a Prior Security
Interest in favor of the Banks and their exist no other Liens, including UCC
filings, judgments, suits and tax and other claims, except for Permitted Liens.
6.1.14. FINANCING STATEMENTS.
The Agent shall have received executed originals of
financing statements necessary to perfect the Lien of the Banks on the
Collateral.
6.1.15. TRADE RECEIVABLES SECURITIZATION.
The Agent shall be satisfied with all aspects of the
Trade Receivables Securitization and the Loan Parties shall have delivered to
the Agent copies of all of the
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documents executed in connection therewith, and the parties thereto shall have
closed on the transactions thereunder.
6.1.16. LANDLORD'S WAIVER.
The Loan Parties shall have delivered an executed
Landlord's Waiver in substantially the form of EXHIBIT 6.1.16 from the lessor
for each leased Collateral location, as listed on Schedule A to the Security
Agreement except for the leased premises in Grove City, Pennsylvania.
6.1.17. PAYOFF.
The Loan Parties shall have delivered an executed payoff
letter from the lenders under the 1998 Credit Agreement which shall evidence
that such Agreement shall be terminated upon the Closing Date upon the payment
of the outstanding balance thereunder.
6.1.18. CONTINGENT LIABILITIES.
The Agent shall be satisfied as to the amount and nature
of all tax, ERISA and other contingent liabilities to which the Loan Parties may
be subject.
6.1.19. APPRAISAL.
The Agent shall have received a satisfactory appraisal
of the inventory of the Loan Parties.
6.1.20. DUE DILIGENCE.
The Agent shall have completed its due diligence with
respect to the Loan Parties.
6.1.21. BORROWING BASE CERTIFICATE.
The Borrower shall deliver a Borrowing Base Certificate
prepared as of the Closing Date in substantially the form of EXHIBIT 7.3.4,
showing that the Borrowing Base shall exceed the Revolving Facility Usage after
giving effect to the Loans to be made on the Closing Date and consummation of
the transactions contemplated hereby.
6.2 EACH ADDITIONAL LOAN OR LETTER OF CREDIT.
At the time of making any Loans or issuing any Letters of Credit
other than Loans made or Letters of Credit issued on the Closing Date and after
giving effect to the proposed extensions of credit: the representations and
warranties of the Loan Parties contained in Section 5.1 and in the other Loan
Documents shall be true on and as of the date of such additional Loan or Letter
of Credit with the same effect as though such representations and
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warranties had been made on and as of such date (except representations and
warranties which expressly relate solely to an earlier date or time, which
representations and warranties shall be true and correct on and as of the
specific dates or times referred to therein) and the Loan Parties shall have
performed and complied with all covenants and conditions hereof; no Event of
Default or Potential Default shall have occurred and be continuing or shall
exist; the making of the Loans or issuance of such Letter of Credit shall not
contravene any Law applicable to any Loan Party or Subsidiary of any Loan Party
or any of the Banks; and the Borrower shall have delivered to the Agent a duly
executed and completed Loan Request or application for a Letter of Credit as the
case may be.
7. COVENANTS
7.1 AFFIRMATIVE COVENANTS.
The Loan Parties, jointly and severally, covenant and agree that
until payment in full of the Loans, Reimbursement Obligations and Letter of
Credit Borrowings, and interest thereon, expiration or termination of all
Letters of Credit, satisfaction of all of the Loan Parties' other Obligations
under the Loan Documents and termination of the Commitments, the Loan Parties
shall comply at all times with the following affirmative covenants:
7.1.1. PRESERVATION OF EXISTENCE, ETC.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain its legal existence as a corporation, limited
partnership or limited liability company and its license or qualification and
good standing in each jurisdiction in which its ownership or lease of property
or the nature of its business makes such license or qualification necessary,
except as otherwise expressly permitted in Section 7.2.6 [Liquidations, Mergers,
Etc.].
7.1.2. PAYMENT OF LIABILITIES, INCLUDING TAXES, ETC.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, duly pay and discharge all liabilities to which it is subject
or which are asserted against it, promptly as and when the same shall become due
and payable, including all taxes, assessments and governmental charges upon it
or any of its properties, assets, income or profits, prior to the date on which
penalties attach thereto, except to the extent that such liabilities, including
taxes, assessments or charges, are being contested in good faith and by
appropriate and lawful proceedings diligently conducted and for which such
reserve or other appropriate provisions, if any, as shall be required by GAAP
shall have been made, but only to the extent that failure to discharge any such
liabilities would not result in any additional liability which would adversely
affect to a material extent the financial condition of any Loan Party or
Subsidiary of any Loan Party or which would affect the Collateral, PROVIDED that
the Loan Parties and their Subsidiaries will pay all such liabilities forthwith
upon the commencement of proceedings to foreclose any Lien which may have
attached as security therefore.
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7.1.3. MAINTENANCE OF INSURANCE.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, insure its properties and assets against loss or damage by fire
and such other insurable hazards as such assets are commonly insured (including
fire, extended coverage, property damage, workers' compensation, public
liability and business interruption insurance) and against other risks
(including errors and omissions) in such amounts as similar properties and
assets are insured by prudent companies in similar circumstances carrying on
similar businesses, and with reputable and financially sound insurers, including
self-insurance to the extent customary, all as reasonably determined by the
Agent. At the request of the Agent, the Loan Parties shall deliver to the Agent
and each of the Banks (x) on the Closing Date and annually thereafter an
original certificate of insurance signed by the Loan Parties' independent
insurance broker describing and certifying as to the existence of the insurance
on the Collateral required to be maintained by this Agreement and the other Loan
Documents, together with a copy of the endorsement described in the next
sentence attached to such certificate and (y) from time to time a summary
schedule indicating all insurance then in force with respect to each of the Loan
Parties. Such policies of insurance shall contain special endorsements, in form
and substance acceptable to the Agent, which shall (i) specify the Agent as an
additional insured, mortgagee and lender loss payee as its interests may appear,
with the understanding that any obligation imposed upon the insured (including
the liability to pay premiums) shall be the sole obligation of the applicable
Loan Parties and not that of the insured, (ii) provide that the interest of the
Banks shall be insured regardless of any breach or violation by the applicable
Loan Parties of any warranties, declarations or conditions contained in such
policies or any action or inaction of the applicable Loan Parties or others
insured under such policies, (iii) provide a waiver of any right of the insurers
to set off or counterclaim or any other deduction, whether by attachment or
otherwise, (iv) provide that any and all rights of subrogation which the
insurers may have or acquire shall be, at all times and in all respects, junior
and subordinate to the prior payment in full of the Indebtedness hereunder and
that no insurer shall exercise or assert any right of subrogation until such
time as the Indebtedness hereunder has been paid in full and the Commitments
have terminated, (v) provide, except in the case of public liability insurance
and workmen's compensation insurance, that all insurance proceeds for losses of
less than $2,500,000 shall be adjusted with and payable to the applicable Loan
Parties and that all insurance proceeds for losses of $2,500,000 or more shall
be adjusted with and payable to the Agent, (vi) include effective waivers by the
insurer of all claims for insurance premiums against the Agent, (vii) provide
that no cancellation of such policies for any reason (including non-payment of
premium) nor any change therein shall be effective until at least thirty (30)
days after receipt by the Agent of written notice of such cancellation or
change, (viii) be primary without right of contribution of any other insurance
carried by or on behalf of any additional insureds with respect to their
respective interests in the Collateral, and (ix) provide that inasmuch as the
policy covers more than one insured, all terms, conditions, insuring agreements
and endorsements (except limits of liability) shall operate as if there were a
separate policy covering each insured. The applicable Loan Parties shall notify
the Agent promptly of any occurrence causing a material loss or decline in value
of the Collateral and the estimated (or
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actual, if available) amount of such loss or decline. Proceeds received by the
Agent shall be applied as follows
(1) If no Event of Default exists at the time the insurance
proceeds are received, the Borrower may reinvest such proceeds in substitute
assets provided that:
(i) the Borrower shall notify the Agent of Borrower's
intent to purchase substitute assets within ten (10) Business Days of the date
of Borrower's receipt of such proceeds, and
(ii) the Borrower shall purchase such substitute
assets within ninety (90) days following such receipt.
If (a) the Borrower fails to deliver the notice within ten (10) Business Days
described in (i) above, the Borrower shall apply all of the proceeds received
prepay the Loans and reduce the Revolving Credit Commitments pursuant to Section
4.5 on the last day of such 5 Business Day period, or (b) if Borrower delivers
the notice described in clause (i) but does not invest all of the proceeds
within 90 days pursuant to clause (ii), then the Borrower shall on the last day
of such 90-day period apply all of the proceeds not so reinvested to repay Loans
and reduce the Revolving Credit Commitments pursuant to Section 4.5.
(2) If an Event of Default exists at the time the insurance
proceeds are received, the Agent may elect to apply the proceeds to repay the
Loans in such manner as the Agent may determine and, in the discretion of the
Agent, reduce the Revolving Credit Commitments to the extent of the amount of
such repayment, or (ii) disburse such proceeds to the applicable Loan Parties on
such terms as are deemed appropriate by the Agent for the repair, restoration
and/or replacement of property in respect of which such proceeds were received.
7.1.4. MAINTENANCE OF PROPERTIES AND LEASES.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain in good repair, working order and condition (ordinary
wear and tear excepted) in accordance with the general practice of other
businesses of similar character and size, all of those properties useful or
necessary to its business, and from time to time, such Loan Party will make or
cause to be made all appropriate repairs, renewals or replacements thereof.
7.1.5. MAINTENANCE OF PATENTS, TRADEMARKS, ETC.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, maintain in full force and effect all patents, trademarks,
service marks, trade names, copyrights, licenses, franchises, permits and other
authorizations necessary for the ownership and operation of its properties and
business if the failure so to maintain the same would constitute a Material
Adverse Change.
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7.1.6. VISITATION RIGHTS.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, permit any of the officers or authorized employees or
representatives of the Agent or any of the Banks to visit and inspect any of its
properties and to examine and make excerpts from its books and records and
discuss its business affairs, finances and accounts with its officers, all in
such detail and at such times and as often as any of the Banks may reasonably
request, PROVIDED that each Bank shall provide the Borrower and the Agent with
reasonable notice prior to any visit or inspection. In the event any Bank
desires to conduct an audit of any Loan Party, such Bank shall make a reasonable
effort to conduct such audit contemporaneously with any audit to be performed by
the Agent.
7.1.7. KEEPING OF RECORDS AND BOOKS OF ACCOUNT.
The Borrower shall, and shall cause each Subsidiary of the
Borrower to, maintain and keep proper books of record and account which enable
the Borrower and its Subsidiaries to issue financial statements in accordance
with GAAP and as otherwise required by applicable Laws of any Official Body
having jurisdiction over the Borrower or any Subsidiary of the Borrower, and in
which full, true and correct entries shall be made in all material respects of
all its dealings and business and financial affairs.
7.1.8. PLANS AND BENEFIT ARRANGEMENTS.
The Borrower shall, and shall cause each other member of
the ERISA Group to, comply with ERISA, the Internal Revenue Code and other
applicable Laws applicable to Plans and Benefit Arrangements except where such
failure, alone or in conjunction with any other failure, would not result in a
Material Adverse Change. Without limiting the generality of the foregoing, the
Borrower shall cause all of its Plans and all Plans maintained by any member of
the ERISA Group to be funded in accordance with the minimum funding requirements
of ERISA and shall make, and cause each member of the ERISA Group to make, in a
timely manner, all contributions due to Plans, Benefit Arrangements and
Multiemployer Plans.
7.1.9. COMPLIANCE WITH LAWS.
Each Loan Party shall, and shall cause each of its
Subsidiaries to, comply with all applicable Laws, including all Environmental
Laws, in all respects, PROVIDED that it shall not be deemed to be a violation of
this Section 7.1.9 if any failure to comply with any Law would not result in
fines, penalties, remediation costs, other similar liabilities or injunctive
relief which in the aggregate would constitute a Material Adverse Change.
7.1.10. USE OF PROCEEDS.
The Loan Parties will use the Letters of Credit and the
proceeds of the Loans only for (i) general corporate purposes and for working
capital, or (ii) to repay and terminate Indebtedness outstanding under the 1998
Credit Facility. The Loan Parties shall not
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use the Letters of Credit or the proceeds of the Loans for any purposes which
contravenes any applicable Law or any provision hereof.
7.1.11. FURTHER ASSURANCES.
Each Loan Party shall, from time to time, at its expense,
faithfully preserve and protect the Agent's Lien on and Prior Security Interest
in the Collateral as a continuing first priority perfected Lien, subject only to
Permitted Liens, and shall do such other acts and things as the Agent in its
sole discretion may deem necessary or advisable from time to time in order to
preserve, perfect and protect the Liens granted under the Loan Documents and to
exercise and enforce its rights and remedies thereunder with respect to the
Collateral.
7.1.12. SUBORDINATION OF INTERCOMPANY LOANS.
Each Loan Party shall cause any intercompany Indebtedness,
loans or advances owed by any Loan Party to any other Loan Party to be
subordinated pursuant to the terms of the Intercompany Subordination Agreement.
7.2 NEGATIVE COVENANTS.
The Loan Parties, jointly and severally, covenant and agree that
until payment in full of the Loans, Reimbursement Obligations and Letter of
Credit Borrowings and interest thereon, expiration or termination of all Letters
of Credit, satisfaction of all of the Loan Parties' other Obligations hereunder
and termination of the Commitments, the Loan Parties shall comply with the
following negative covenants:
7.2.1. INDEBTEDNESS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time create, incur, assume or suffer to exist
any Indebtedness, except:
(i) Indebtedness under the Loan Documents;
(ii) Existing Indebtedness, excluding Indebtedness
described in clauses (i) through (vii) as set forth on SCHEDULE 7.2.1 (including
any extensions or renewals thereof, PROVIDED there is no increase in the amount
thereof or other significant change in the terms thereof unless otherwise
specified on SCHEDULE 7.2.1;
(iii) Trade letters of credit issued under the First
Union Facility in an amount not to exceed $15,000,000 on the Closing Date and
thereafter as such amount is reduced by the face amount of such letters of
credit which expire or are replaced. All letters of credit issued under the
First Union Facility shall have been drawn or replaced or shall have expired on
or before July 31, 2002 and letters of credit under the First Union Facility
shall cease to be Permitted Indebteness hereunder after such date;
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(iv) Capital or other liabilities under the Trade
Receivables Securitization, provided that the amount thereof shall not exceed
$150,000,000
(v) Capitalized leases in an amount not to exceed
$5,000,000. Borrower has listed on Schedule 7.2.1 the amount of capitalized
leases existing on the Closing Date;
(vi) Indebtedness, or Guaranties of Indebtedness, of
a Loan Party to another Loan Party which is subordinated in accordance with the
provisions of Section 7.1.12 [Subordination of Intercompany Loans];
(vii) Any Bank-Provided Interest Rate Hedge or other
Interest Rate Hedge approved by the Agent.
7.2.2. LIENS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time create, incur, assume or suffer to exist
any Lien on any of its property or assets, tangible or intangible, now owned or
hereafter acquired, or agree or become liable to do so, except Permitted Liens.
7.2.3. GUARANTIES.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time, directly or indirectly, become or be
liable in respect of any Guaranty, or assume, guarantee, become surety for,
endorse or otherwise agree, become or remain directly or contingently liable
upon or with respect to any obligation or liability of any other Person, except
for Guaranties of Indebtedness of the Loan Parties permitted hereunder.
7.2.4. LOANS AND INVESTMENTS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time make or suffer to remain outstanding any
loan or advance to, or purchase, acquire or own any stock, bonds, notes or
securities of, or any partnership interest (whether general or limited) or
limited liability company interest in, or any Guaranty for the benefit of or any
other investment or interest in, or make any capital contribution to, any other
Person, or agree, become or remain liable to do any of the foregoing
(collectively "Investments"), except:
(i) trade credit extended on usual and customary
terms in the ordinary course of business;
(ii) advances to employees to meet expenses incurred
by such employees in the ordinary course of business;
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(iii) Permitted Investments; and
(iv) Investments in other Loan Parties.
(v) Investments in Foreign Subsidiaries not to exceed
$1,500,000
(vi) Investments in JLB Service Bank not to exceed
$2,500,000 at any time following receipt of applicable federal and state
regulatory approvals for the organization and operation thereof.
(vii) The following Investments in the Xxxx Xxxxxxx
Joint Venture:
(a) equity investments in the Xxxx Xxxxxxx
Joint Venture in an amount not to exceed $200,000 in the aggregate, and
(b) loans by the Borrower to the Xxxx Xxxxxxx
Joint Venture in an amount not to exceed $5,000,000 in the aggregate provided
that on or before prior to the making of such loans,
(1) the Xxxx Xxxxxxx Joint Venture shall
execute a note in favor of the Borrower evidencing such loans and a security
agreement granting first priority security interest and Liens in the inventory
and other assets (but not Excluded Assets) of the Xxxx Xxxxxxx Joint Venture in
favor of the Borrower and appropriate financing statements perfecting such first
priority security interest and Liens all in such forms as are approved by and
acceptable to the Agent, and
(2) the Borrower shall cause the note,
security agreement and Liens described in clause (1) above to be assigned and
pledged to the Agent so that the Agent shall have a first priority security
interest and Liens in such items in such forms as are approved by and acceptable
to the Agent and with accompanying documentation reasonably requested by the
Agent which may include appropriate lien searches and opinions of counsel.
7.2.5. DIVIDENDS AND RELATED DISTRIBUTIONS AND STOCK REPURCHASES.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, make or pay, or agree to become or remain liable to
make or pay, any dividend or other distribution of any nature (whether in cash,
property, securities or otherwise) on account of or in respect of its shares of
capital stock, partnership interests or limited liability company interests on
account of the purchase, redemption, retirement or acquisition of its shares of
capital stock (or warrants, options or rights therefor), partnership interests
or limited liability company
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interests, except dividends or other distributions payable to another Loan
Party, except for dividends paid by the Borrower and repurchases by the Borrower
of its Shares provided that (1) there shall exist no Potential Default or Event
of Default on the date of any such payment of a dividend or stock repurchase,
and (2) the total consideration paid for all stock repurchases by the Borrower
over the term of this Agreement shall not exceed $5,000,000.
7.2.6. LIQUIDATIONS, MERGERS, CONSOLIDATIONS, ACQUISITIONS.
The Loan Parties shall not, and shall not permit any of
their Subsidiaries to, dissolve, liquidate or wind-up its affairs, or become a
party to any merger or consolidation, or acquire by purchase, lease or otherwise
all or substantially all of the assets or capital stock of any other Person,
EXCEPT that (A) any Subsidiary of the Borrower may consolidate or merge into the
Borrower or any other Loan Party or its Subsidiary, provided that the Loan
Parties shall (1) notify the Agent at least 10 Business Days prior to any such
merger, and (2) take all steps necessary or appropriate or reasonably requested
by the Agent to cause the successor to grant Liens in of the assets of the
merging entity in favor of the Agent for the benefit of the Banks; and that (B)
the Loan Parties or a Subsidiary thereof may merge with or purchase, lease or
otherwise acquire all of the assets of another Person (each a "Transaction")
provided that (i) the aggregate consideration paid or given, whether in cash,
stock, or other property, and liabilities assumed by the Borrower and its
Subsidiaries in all Transactions during each fiscal year of the Borrower (the
"Transaction Consideration") does not exceed $7,500,000; (ii) the Loan Party
shall be the surviving Person if the Transaction is a merger to which the Loan
Party is a party; (iii) the Loan Parties and the acquired business shall comply
with Section 7.2.10 [Continuation of or Change in Business], (iv) after giving
effect to such Transaction there shall not be continuing any Event of Default
under this Agreement; (v) the board of directors or equivalent governing
officers of the acquired business shall have consented to such transaction, (vi)
the Borrower shall notify the Agent and the Banks of such Transaction within
five (5) Business Days before the date of such Transaction if the Transaction
Consideration exceeds $1,000,000 and such notice shall describe such
Transaction, the purpose therefore, the parties thereto, and the amount and type
of the Consideration paid and (vii) the Loan Parties and the new Subsidiaries
being formed or acquired in connection therewith shall have delivered to the
Agent prior to such sale joinders and other documents described in Section 10.19
required to cause the acquired or newly formed Subsidiaries to join the Loan
Documents as Guarantors, grant Liens in their assets and for their owners to
grant Liens in the ownership interests in such Subsidiaries.
7.2.7. DISPOSITIONS OF ASSETS OR SUBSIDIARIES.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, sell, convey, assign, lease, abandon or otherwise
transfer or dispose of, voluntarily or involuntarily, any of its properties or
assets, tangible or intangible (including sale, assignment, discount or other
disposition of accounts, contract rights, chattel paper, equipment or general
intangibles with or without recourse or of capital stock, shares of beneficial
interest, partnership interests or limited liability company interests of a
Subsidiary of such Loan Party), except:
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(i) transactions involving the sale of inventory in
the ordinary course of business, excluding any sales of inventory to the Xxxx
Xxxxxxx Joint Venture which are addressed in clause (ii) below;
(ii) The sale of inventory by the Borrower to the
Xxxx Xxxxxxx Joint Venture, provided that (1) the aggregate book value of such
inventory purchased may not exceed $5,000,000 at any time, (2) the purchase
price paid by the Xxxx Xxxxxxx Joint Venture therefore shall not be less than
the amount paid by the Borrower therefor, and (3) the Xxxx Xxxxxxx Joint Venture
shall execute and deliver a note in consideration for any such purchase which is
not paid for in cash and shall grant Liens in such inventory in favor of the
Borrower and the Xxxx Xxxxxxx Joint Venture and the Borrower shall take such
other steps as are described in clause (vii)(b) of Section 7.2.4 with respect to
such sale and related transactions,
(iii) sales of the Exluded Assets in connection with
the Trade Receivables Securitization;
(iv) any sale, transfer or lease of assets in the
ordinary course of business which are no longer necessary or required in the
conduct of such Loan Party's or such Subsidiary's business;
(v) any sale, transfer or lease of assets by any
wholly owned Subsidiary of such Loan Party to another Loan Party;
(vi) any sale, transfer or lease of assets in the
ordinary course of business which are replaced by substitute assets acquired or
leased within the parameters of Section 7.2.14 [Capital Expenditures and
Leases], provided such substitute assets are subject to the Banks' Prior
Security Interest; or
(vii) any sale, transfer or lease of assets, other
than those specifically excepted pursuant to clauses (i) through (vi) above,
which is approved by the Required Banks, so long as the after-tax proceeds (as
reasonably estimated by the Borrower) are applied as a mandatory prepayment of
the Loans in accordance with the provisions of Section 4.5.1 [Sale of Assets;
Receipt of Insurance Proceeds] if the amount of such proceeds exceeds
$1,000,000.
7.2.8. AFFILIATE TRANSACTIONS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, enter into or carry out any transaction (including
purchasing property or services from or selling property or services to any
Affiliate of any Loan Party or other Person) unless such transaction is not
otherwise prohibited by this Agreement, is entered into in the ordinary course
of business upon fair and reasonable arm's-length terms and conditions which are
fully disclosed to the Agent and is in accordance with all applicable Law.
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7.2.9. SUBSIDIARIES, PARTNERSHIPS AND JOINT VENTURES.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, own or create directly or indirectly any
Subsidiaries other than (i) any Subsidiary which has joined this Agreement as
Guarantor on the Closing Date; (ii) any Subsidiary formed after the Closing Date
which joins this Agreement as a Guarantor pursuant to Section 10.19 [Joinder of
Guarantors], and (iii) any of the Excluded Subsidiaries, provided that the
Required Banks shall have consented to any formation of each Subsidiary
described in clause (ii) and joinder by such Subsidiary to this Agreement and
the other Loan Documents and that such Subsidiary and the Loan Parties, as
applicable, shall grant and cause to be perfected first priority Liens to the
Agent for the benefit of the Banks in such Subsidiary's inventory and the assets
(excluding Excluded Assets) held by, and stock of or other ownership interests
in, such Subsidiary. Each of the Loan Parties shall not become or agree to (1)
become a general or limited partner in any general or limited partnership,
except that the Loan Parties may be general or limited partners in other Loan
Parties, (2) become a member or manager of, or hold a limited liability company
interest in, a limited liability company, except that the Loan Parties may be
members or managers of, or hold limited liability company interests in, other
Loan Parties or Excluded Subsidiaries, or (3) become a joint venturer or hold a
joint venture interest in any joint venture.
7.2.10. CONTINUATION OF OR CHANGE IN BUSINESS.
The Loan Parties shall not, and shall not permit any of
their Subsidiaries to, engage in any business other than the retail catalogue
business, the ownership and use of related intellectual property, and the
maintenance, sale and servicing of trade and customer receivables arising
therefrom or in connection therewith substantially as conducted and operated by
such Borrower or Subsidiary during the present fiscal year, and such Loan Party
or Subsidiary shall not permit any material change in such business.
7.2.11. PLANS AND BENEFIT ARRANGEMENTS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to:
(i) fail to satisfy the minimum funding requirements
of ERISA and the Internal Revenue Code with respect to any Plan;
(ii) request a minimum funding waiver from the
Internal Revenue Service with respect to any Plan;
(iii) engage in a Prohibited Transaction with any
Plan, Benefit Arrangement or Multiemployer Plan which, alone or in conjunction
with any other circumstances or set of circumstances resulting in liability
under ERISA, would constitute a Material Adverse Change;
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(iv) permit the aggregate actuarial present value of
all benefit liabilities (whether or not vested) under each Plan, determined on a
plan termination basis, as disclosed in the most recent actuarial report
completed with respect to such Plan, to exceed, as of any actuarial valuation
date, the fair market value of the assets of such Plan;
(v) fail to make when due any contribution to any
Multiemployer Plan that the Borrower or any member of the ERISA Group may be
required to make under any agreement relating to such Multiemployer Plan, or any
Law pertaining thereto;
(vi) withdraw (completely or partially) from any
Multiemployer Plan or withdraw (or be deemed under Section 4062(e) of ERISA to
withdraw) from any Multiple Employer Plan, where any such withdrawal is likely
to result in a material liability of the Borrower or any member of the ERISA
Group;
(vii) terminate, or institute proceedings to
terminate, any Plan, where such termination is likely to result in a material
liability to the Borrower or any member of the ERISA Group;
(viii) make any amendment to any Plan with respect to
which security is required under Section 307 of ERISA; or
(ix) fail to give any and all notices and make all
disclosures and governmental filings required under ERISA or the Internal
Revenue Code, where such failure is likely to result in a Material Adverse
Change.
7.2.12. FISCAL YEAR.
The Borrower shall not, and shall not permit any Subsidiary
of the Borrower to, change its fiscal year from the twelve-month period
beginning January 1 and ending December 31.
7.2.13. CHANGES IN ORGANIZATIONAL DOCUMENTS.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, amend in any respect its certificate of
incorporation (including any provisions or resolutions relating to capital
stock), by-laws, certificate of limited partnership, partnership agreement,
certificate of formation, limited liability company agreement or other
organizational documents without providing at least fifteen (15) calendar days'
prior written notice to the Agent and the Banks and, in the event such change
would be adverse to the Banks as determined by the Agent in its sole discretion,
obtaining the prior written consent of the Required Banks.
7.2.14. CAPITAL EXPENDITURES AND LEASES.
Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, make any payments exceeding the amounts specified
below in the aggregate in
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any fiscal year specified below on account of the purchase or lease of any
assets which if purchased would constitute fixed assets or which if leased would
constitute a capitalized lease (the excess of the permited amounts of capital
expenditures in each year over the amount of actual capital expenditures in such
year will increase the permitted amount for the immediately following year):
FISCAL YEAR MAXIMUM CAPITAL EXPENDITURES
----------- ----------------------------
Year ending December 31, 2002 $23,000,000
Year ending December 31, 2003 $13,000,000
Year ending December 31, 2004 $12,000,000
7.2.15. MAXIMUM LEVERAGE RATIO.
The Loan Parties shall not at any time permit the Leverage
Ratio at any time to exceed 3.0 to l.0
7.2.16. MINIMUM FIXED CHARGE COVERAGE RATIO.
The Loan Parties shall not permit the Fixed Charge Coverage
Ratio, calculated as of the end of each fiscal quarter for the four (4) fiscal
quarters then ended, to be less than the minimum ratio specified below during
the period specified below.
PERIOD MINIMUM RATIO
------ -------------
Closing Date through December 31, 2002 1.15 to 1.0
On and after January 1, 2003 1.25 to 1.0
7.2.17. MINIMUM TANGIBLE NET WORTH.
The Borrower shall not at any time permit Consolidated
Tangible Net Worth to be less than Base Tangible Net Worth.
7.3 REPORTING REQUIREMENTS.
The Loan Parties, jointly and severally, covenant and agree that
until payment in full of the Loans, Reimbursement Obligations and Letter of
Credit Borrowings and interest thereon, expiration or termination of all Letters
of Credit, satisfaction of all of the Loan Parties' other Obligations hereunder
and under the other Loan Documents and termination of the Commitments, the Loan
Parties will furnish or cause to be furnished to the Agent and each of the
Banks:
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7.3.1. QUARTERLY FINANCIAL STATEMENTS.
As soon as available and in any event within forty-five (45)
calendar days after the end of each of the first three fiscal quarters in each
fiscal year, financial statements of the Borrower, consisting of a consolidated
and consolidating balance sheet as of the end of such fiscal quarter and related
consolidated and consolidating statements of income, stockholders' equity and
cash flows for the fiscal quarter then ended and the fiscal year through that
date, all in reasonable detail and certified (subject to normal year-end audit
adjustments) by the President, Chief Financial Officer, Treasurer or Assistant
Treasurer of the Borrower as having been prepared in accordance with GAAP,
consistently applied, and setting forth in comparative form the respective
financial statements for the corresponding date and period in the previous
fiscal year.
7.3.2. ANNUAL FINANCIAL STATEMENTS.
As soon as available and in any event within ninety (90)
days after the end of each fiscal year of the Borrower, financial statements of
the Borrower consisting of a consolidated and consolidating balance sheet as of
the end of such fiscal year, and related consolidated and consolidating
statements of income, stockholders' equity and cash flows for the fiscal year
then ended, all in reasonable detail and setting forth in comparative form the
financial statements as of the end of and for the preceding fiscal year, and
certified by independent certified public accountants of nationally recognized
standing satisfactory to the Agent. The certificate or report of accountants
shall be free of qualifications (other than any consistency qualification that
may result from a change in the method used to prepare the financial statements
as to which such accountants concur) and shall not indicate the occurrence or
existence of any event, condition or contingency which would materially impair
the prospect of payment or performance of any covenant, agreement or duty of any
Loan Party under any of the Loan Documents. The Loan Parties shall deliver with
such financial statements and certification by their accountants a letter of
such accountants to the Agent and the Banks substantially (i) to the effect
that, based upon their ordinary and customary examination of the affairs of the
Borrower, performed in connection with the preparation of such consolidated
financial statements, and in accordance with generally accepted auditing
standards, they are not aware of the existence of any condition or event which
constitutes an Event of Default or Potential Default or, if they are aware of
such condition or event, stating the nature thereof and confirming the
Borrower's calculations with respect to the certificate to be delivered pursuant
to Section 7.3.3 [Certificate of the Borrower] with respect to such financial
statements and (ii) to the effect that the Banks are intended to rely upon such
accountant's certification of the annual financial statements and that such
accountants authorize the Loan Parties to deliver such reports and certificate
to the Banks on such accountants' behalf.
7.3.3. CERTIFICATE OF THE BORROWER.
Concurrently with the financial statements of the Borrower
furnished to the Agent and to the Banks pursuant to Sections 7.3.1 [Quarterly
Financial Statements] and 7.3.2
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[Annual Financial Statements], a certificate (each a "Compliance Certificate")
of the Borrower signed by the President or Chief Financial Officer, Treasurer or
Assistant Treasurer of the Borrower, in the form of EXHIBIT 7.3.3, to the effect
that, except as described pursuant to Section 7.3.5 [Notice of Default], (i) the
representations and warranties of the Borrower contained in Section 5.1 and in
the other Loan Documents are true on and as of the date of such certificate with
the same effect as though such representations and warranties had been made on
and as of such date (except representations and warranties which expressly
relate solely to an earlier date or time) and the Loan Parties have performed
and complied with all covenants and conditions hereof, (ii) no Event of Default
or Potential Default exists and is continuing on the date of such certificate
and (iii) containing calculations in sufficient detail to demonstrate compliance
as of the date of such financial statements with all financial covenants
contained in Section 7.2 [Negative Covenants].
7.3.4. MONTHLY BORROWING BASE CERTIFICATES, SCHEDULES OF ACCOUNTS,
INVENTORY AND PAYABLES.
As soon as available: by the fifteenth (15th) day of each
fiscal month of the Borrower, a Borrowing Base Certificate as of the last day of
the immediately preceding fiscal month in the form of EXHIBIT 7.3.4 hereto,
appropriately completed, executed and delivered by an Authorized Officer,
together with a detailed sales register, a cash receipts journal and a purchase
journal showing sales, receipts and purchases for the preceding month,
Upon request by the Agent, monthly Schedules of Accounts,
Schedules of Inventory and Schedules of Payables as of the end of each month due
within five (5) days thereafter;
7.3.5. NOTICE OF DEFAULT.
Promptly after any officer of any Loan Party has learned of
the occurrence of an Event of Default or Potential Default, a certificate signed
by the Chief Executive Officer, President or Chief Financial Officer of such
Loan Party setting forth the details of such Event of Default or Potential
Default and the action which the such Loan Party proposes to take with respect
thereto.
7.3.6. NOTICE OF LITIGATION.
Promptly after the commencement thereof, notice of all
actions, suits, proceedings or investigations before or by any Official Body or
any other Person against any Loan Party or Subsidiary of any Loan Party which
relate to the Collateral, involve a claim or series of claims in excess of
$1,000,000 or which if adversely determined would constitute a Material Adverse
Change.
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7.3.7. CERTAIN EVENTS.
Written notice to the Agent:
(i) at least fifteen (15) calendar days prior
thereto, with respect to any proposed sale or transfer of assets pursuant to
Section 7.2.7((vi)) or ((vii)),
(ii) within the time limits set forth in Section
7.2.13 [Changes in Organizational Documents], any amendment to the
organizational documents of any Loan Party; and
(iii) at least fifteen (15) calendar days prior
thereto, with respect to any change in any Loan Party's locations from the
locations set forth in Schedule A to the Security Agreement.
7.3.8. BUDGETS, FORECASTS, OTHER REPORTS, INSURANCE POLICIES AND
INFORMATION.
Promptly upon there becoming available to the Borrower:
(i) the annual budget and any forecasts or
projections of the Borrower, to be supplied not later than thirty (30) days
prior to commencement of the fiscal year to which any of the foregoing may be
applicable,
(ii) any reports including management letters
submitted to the Borrower by independent accountants in connection with any
annual, interim or special audit,
(iii) any reports, notices or proxy statements
generally distributed by the Borrower to its stockholders on a date no later
than the date supplied to such stockholders,
(iv) regular or periodic reports, including Forms
10-K, 10-Q and 8-K, registration statements and prospectuses, filed by the
Borrower with the Securities and Exchange Commission,
(v) a copy of any order in any proceeding to which
the Borrower or any of its Subsidiaries is a party issued by any Official Body,
and
(vi) such other reports and information, including
copies of insurance policies, as the Agent or any of the Banks may from time to
time reasonably request. The Borrower shall also notify the Banks promptly of
the enactment or adoption of any Law which may result in a Material Adverse
Change.
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7.3.9. NOTICES REGARDING PLANS AND BENEFIT ARRANGEMENTS.
7.3.9.1 CERTAIN EVENTS.
Promptly upon becoming aware of the occurrence
thereof, notice (including the nature of the event and, when known, any action
taken or threatened by the Internal Revenue Service or the PBGC with respect
thereto) of:
(i) any Reportable Event with respect to the
Borrower or any other member of the ERISA Group (regardless of whether the
obligation to report said Reportable Event to the PBGC has been waived),
(ii) any Prohibited Transaction which could
subject the Borrower or any other member of the ERISA Group to a civil penalty
assessed pursuant to Section 502(i) of ERISA or a tax imposed by Section 4975 of
the Internal Revenue Code in connection with any Plan, any Benefit Arrangement
or any trust created thereunder,
(iii) any assertion of material withdrawal
liability with respect to any Multiemployer Plan,
(iv) any partial or complete withdrawal from a
Multiemployer Plan by the Borrower or any other member of the ERISA Group under
Title IV of ERISA (or assertion thereof), where such withdrawal is likely to
result in material withdrawal liability,
(v) any cessation of operations (by the Borrower
or any other member of the ERISA Group) at a facility in the circumstances
described in Section 4062(e) of ERISA,
(vi) withdrawal by the Borrower or any other
member of the ERISA Group from a Multiple Employer Plan,
(vii) a failure by the Borrower or any other
member of the ERISA Group to make a payment to a Plan required to avoid
imposition of a Lien under Section 302(f) of ERISA,
(viii) the adoption of an amendment to a Plan
requiring the provision of security to such Plan pursuant to Section 307 of
ERISA, or
(ix) any change in the actuarial assumptions or
funding methods used for any Plan, where the effect of such change is to
materially increase or materially reduce the unfunded benefit liability or
obligation to make periodic contributions.
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7.3.9.2 NOTICES OF INVOLUNTARY TERMINATION AND ANNUAL
REPORTS.
Promptly after receipt thereof, copies of (a) all
notices received by the Borrower or any other member of the ERISA Group of the
PBGC's intent to terminate any Plan administered or maintained by the Borrower
or any member of the ERISA Group, or to have a trustee appointed to administer
any such Plan; and (b) at the request of the Agent or any Bank each annual
report (IRS Form 5500 series) and all accompanying schedules, the most recent
actuarial reports, the most recent financial information concerning the
financial status of each Plan administered or maintained by the Borrower or any
other member of the ERISA Group, and schedules showing the amounts contributed
to each such Plan by or on behalf of the Borrower or any other member of the
ERISA Group in which any of their personnel participate or from which such
personnel may derive a benefit, and each Schedule B (Actuarial Information) to
the annual report filed by the Borrower or any other member of the ERISA Group
with the Internal Revenue Service with respect to each such Plan.
7.3.9.3 NOTICE OF VOLUNTARY TERMINATION.
Promptly upon the filing thereof, copies of any Form
5310, or any successor or equivalent form to Form 5310, filed with the PBGC in
connection with the termination of any Plan.
8. DEFAULT
8.1 EVENTS OF DEFAULT.
An Event of Default shall mean the occurrence or existence of any
one or more of the following events or conditions (whatever the reason therefor
and whether voluntary, involuntary or effected by operation of Law):
8.1.1. PAYMENTS UNDER LOAN DOCUMENTS.
The Borrower shall fail to pay any principal of any Loan
(including scheduled installments, mandatory prepayments or the payment due at
maturity), Reimbursement Obligation or Letter of Credit Borrowing or shall fail
to pay any interest on any Loan, Reimbursement Obligation or Letter of Credit
Borrowing or any other amount owing hereunder or under the other Loan Documents
after such principal, interest or other amount becomes due in accordance with
the terms hereof or thereof;
8.1.2. BREACH OF WARRANTY.
Any representation or warranty made at any time by any of
the Loan Parties herein or by any of the Loan Parties in any other Loan
Document, or in any certificate,
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other instrument or statement furnished pursuant to the provisions hereof or
thereof, shall prove to have been false or misleading in any material respect as
of the time it was made or furnished;
8.1.3. BREACH OF NEGATIVE COVENANTS OR VISITATION RIGHTS.
Any of the Loan Parties shall default in the observance or
performance of any covenant contained in Section 7.1.6 [Visitation Rights] or
Section 7.2 [Negative Covenants];
8.1.4. BREACH OF OTHER COVENANTS.
Any of the Loan Parties shall default in the observance or
performance of any other covenant, condition or provision hereof or of any other
Loan Document and such default shall continue unremedied for a period of twenty
(20) days after any officer of any Loan Party becomes aware of the occurrence
thereof (such grace period to be applicable only in the event such default can
be remedied by corrective action of the Loan Parties as determined by the Agent
in its sole discretion);
8.1.5. DEFAULTS IN OTHER AGREEMENTS OR INDEBTEDNESS.
A default or event of default shall occur at any time under
the terms of any other agreement involving borrowed money or the extension of
credit or any other Indebtedness under which any Loan Party or Subsidiary of any
Loan Party may be obligated as a borrower or guarantor in excess of $1,000,000
in the aggregate, and such breach, default or event of default consists of the
failure to pay (beyond any period of grace permitted with respect thereto,
whether waived or not) any indebtedness when due (whether at stated maturity, by
acceleration or otherwise) or if such breach or default permits or causes the
acceleration of any indebtedness (whether or not such right shall have been
waived) or the termination of any commitment to lend;
8.1.6. FINAL JUDGMENTS OR ORDERS.
Any final judgments or orders for the payment of money in
excess of $1,000,000 in the aggregate shall be entered against any Loan Party by
a court having jurisdiction in the premises, which judgment is not discharged,
vacated, bonded or stayed pending appeal within a period of thirty (30) days
from the date of entry;
8.1.7. LOAN DOCUMENT UNENFORCEABLE.
Any of the Loan Documents shall cease to be legal, valid and
binding agreements enforceable against the party executing the same or such
party's successors and assigns (as permitted under the Loan Documents) in
accordance with the respective terms thereof or shall in any way be terminated
(except in accordance with its terms) or become or be declared ineffective or
inoperative or shall in any way be challenged or contested or cease to give or
provide the respective Liens, security interests, rights, titles, interests,
remedies, powers or privileges intended to be created thereby;
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8.1.8. UNINSURED LOSSES; PROCEEDINGS AGAINST ASSETS.
There shall occur any material uninsured damage to or loss,
theft or destruction of any of the Collateral in excess of $1,000,000 or the
Collateral or any other of the Loan Parties' or any of their Subsidiaries'
assets are attached, seized, levied upon or subjected to a writ or distress
warrant; or such come within the possession of any receiver, trustee, custodian
or assignee for the benefit of creditors and the same is not cured within thirty
(30) days thereafter;
8.1.9. NOTICE OF LIEN OR ASSESSMENT.
A notice of Lien or assessment in excess of $1,000,000 which
is not a Permitted Lien is filed of record with respect to all or any part of
any of the Loan Parties' or any of their Subsidiaries' assets by the United
States, or any department, agency or instrumentality thereof, or by any state,
county, municipal or other governmental agency, including the PBGC, or any taxes
or debts owing at any time or times hereafter to any one of these becomes
payable and the same is not paid within thirty (30) days after the same becomes
payable;
8.1.10. INSOLVENCY.
Any Loan Party or any Subsidiary of a Loan Party ceases to
be Solvent or admits in writing its inability to pay its debts as they mature;
8.1.11. EVENTS RELATING TO PLANS AND BENEFIT ARRANGEMENTS.
Any of the following occurs: (i) any Reportable Event,
which the Agent determines in good faith constitutes grounds for the termination
of any Plan by the PBGC or the appointment of a trustee to administer or
liquidate any Plan, shall have occurred and be continuing; (ii) proceedings
shall have been instituted or other action taken to terminate any Plan, or a
termination notice shall have been filed with respect to any Plan; (iii) a
trustee shall be appointed to administer or liquidate any Plan; (iv) the PBGC
shall give notice of its intent to institute proceedings to terminate any Plan
or Plans or to appoint a trustee to administer or liquidate any Plan; and, in
the case of the occurrence of (i), (ii), (iii) or (iv) above, the Agent
determines in good faith that the amount of the Borrower's liability is likely
to exceed 10% of its consolidated tangible net worth; (v) the Borrower or any
member of the ERISA Group shall fail to make any contributions when due to a
Plan or a Multiemployer Plan; (vi) the Borrower or any other member of the ERISA
Group shall make any amendment to a Plan with respect to which security is
required under Section 307 of ERISA; (vii) the Borrower or any other member of
the ERISA Group shall withdraw completely or partially from a Multiemployer
Plan; (viii) the Borrower or any other member of the ERISA Group shall withdraw
(or shall be deemed under Section 4062(e) of ERISA to withdraw) from a Multiple
Employer Plan; or (ix) any applicable Law is adopted, changed or interpreted by
any Official Body with respect to or otherwise affecting one or more Plans,
Multiemployer Plans or Benefit Arrangements and, with respect to any of the
events specified in (v), (vi), (vii), (viii) or (ix), the Agent determines in
good faith that
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any such occurrence would be reasonably likely to materially and adversely
affect the total enterprise represented by the Borrower and the other members of
the ERISA Group;
8.1.12. CESSATION OF BUSINESS.
Any Loan Party or Subsidiary of a Loan Party ceases to
conduct its business as contemplated, except as expressly permitted under
Section 7.2.6 [Liquidations, Mergers, Etc.] or 7.2.7, or any Loan Party or
Subsidiary of a Loan Party is enjoined, restrained or in any way prevented by
final court order from conducting all or any material part of its business and
such injunction, restraint or other preventive order is not dismissed within
thirty (30) days after the entry thereof;
8.1.13. CHANGE OF CONTROL.
Any person or group of persons (within the meaning of
Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended)
shall have acquired beneficial ownership of (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under said Act) 40% or
more of the outstanding voting capital stock of the Borrower; or (ii) within a
period of twelve (12) consecutive calendar months, individuals who were
directors of the Borrower on the first day of such period shall cease to
constitute a majority of the board of directors of the Borrower;
8.1.14. INVOLUNTARY PROCEEDINGS.
A proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of
any Loan Party or Subsidiary of a Loan Party in an involuntary case under any
applicable bankruptcy, insolvency, reorganization or other similar law now or
hereafter in effect, or for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator, conservator (or similar official) of any Loan
Party or Subsidiary of a Loan Party for any substantial part of its property, or
for the winding-up or liquidation of its affairs, and such proceeding shall
remain undismissed or unstayed and in effect for a period of forty-five (45)
consecutive days or such court shall enter a decree or order granting any of the
relief sought in such proceeding; or
8.1.15. VOLUNTARY PROCEEDINGS.
Any Loan Party or Subsidiary of a Loan Party shall commence
a voluntary case under any applicable bankruptcy, insolvency, reorganization or
other similar law now or hereafter in effect, shall consent to the entry of an
order for relief in an involuntary case under any such law, or shall consent to
the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator, conservator (or other similar official) of
itself or for any substantial part of its property or shall make a general
assignment for the benefit of creditors, or shall fail generally to pay its
debts as they become due, or shall take any action in furtherance of any of the
foregoing.
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8.2 CONSEQUENCES OF EVENT OF DEFAULT.
8.2.1. EVENTS OF DEFAULT OTHER THAN BANKRUPTCY, INSOLVENCY OR
REORGANIZATION PROCEEDINGS.
If an Event of Default specified under Sections 8.1.1
through 8.1.13 shall occur and be continuing, the Banks and the Agent shall be
under no further obligation to make Loans or issue Letters of Credit, as the
case may be, and the Agent may, and upon the request of the Required Banks,
shall (i) by written notice to the Borrower, declare the unpaid principal amount
of the Notes then outstanding and all interest accrued thereon, any unpaid fees
and all other Indebtedness of the Borrower to the Banks hereunder and thereunder
to be forthwith due and payable, and the same shall thereupon become and be
immediately due and payable to the Agent for the benefit of each Bank without
presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived, and (ii) require the Borrower to, and the Borrower
shall thereupon, deposit in a non-interest-bearing account with the Agent, as
cash collateral for its Obligations under the Loan Documents, an amount equal to
the maximum amount currently or at any time thereafter available to be drawn on
all outstanding Letters of Credit, and the Borrower hereby pledges to the Agent
and the Banks, and grants to the Agent and the Banks a security interest in, all
such cash as security for such Obligations. Upon the curing of all existing
Events of Default to the satisfaction of the Required Banks, the Agent shall
return such cash collateral to the Borrower; and
8.2.2. BANKRUPTCY, INSOLVENCY OR REORGANIZATION PROCEEDINGS.
If an Event of Default specified under Section 8.1.14
[Involuntary Proceedings] or 8.1.15 [Voluntary Proceedings] shall occur, the
Banks shall be under no further obligations to make Loans hereunder and the
unpaid principal amount of the Loans then outstanding and all interest accrued
thereon, any unpaid fees and all other Indebtedness of the Borrower to the Banks
hereunder and thereunder shall be immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived; and
8.2.3. SET-OFF.
If an Event of Default shall occur and be continuing, any
Bank to whom any Obligation is owed by any Loan Party hereunder or under any
other Loan Document or any participant of such Bank which has agreed in writing
to be bound by the provisions of Section 9.13 [Equalization of Banks] and any
branch, Subsidiary or Affiliate of such Bank or participant anywhere in the
world shall have the right, in addition to all other rights and remedies
available to it, without notice to such Loan Party, to set-off against and apply
to the then unpaid balance of all the Loans and all other Obligations of the
Borrower and the other Loan Parties hereunder or under any other Loan Document
any debt owing to, and any other funds held in any manner for the account of,
the Borrower or such other Loan Party by such Bank or participant or by such
branch, Subsidiary or Affiliate, including all funds in all deposit accounts
(whether time
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or demand, general or special, provisionally credited or finally credited, or
otherwise) now or hereafter maintained by the Borrower or such other Loan Party
for its own account (but not including funds held in custodian or trust
accounts) with such Bank or participant or such branch, Subsidiary or Affiliate.
Such right shall exist whether or not any Bank or the Agent shall have made any
demand under this Agreement or any other Loan Document, whether or not such debt
owing to or funds held for the account of the Borrower or such other Loan Party
is or are matured or unmatured and regardless of the existence or adequacy of
any Collateral, Guaranty or any other security, right or remedy available to any
Bank or the Agent; and
8.2.4. SUITS, ACTIONS, PROCEEDINGS.
If an Event of Default shall occur and be continuing, and
whether or not the Agent shall have accelerated the maturity of Loans pursuant
to any of the foregoing provisions of this Section 8.2, the Agent or any Bank,
if owed any amount with respect to the Loans, may proceed to protect and enforce
its rights by suit in equity, action at law and/or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Agreement or the other Loan Documents, including as permitted by applicable
Law the obtaining of the EX PARTE appointment of a receiver, and, if such amount
shall have become due, by declaration or otherwise, proceed to enforce the
payment thereof or any other legal or equitable right of the Agent or such Bank;
and
8.2.5. APPLICATION OF PROCEEDS; COLLATERAL SHARING.
8.2.5.1 APPLICATION OF PROCEEDS.
From and after the date on which the Agent has taken any
action pursuant to this Section 8.2 and until all Obligations of the Loan
Parties have been paid in full, any and all proceeds received by the Agent from
any sale or other disposition of the Collateral, or any part thereof, or the
exercise of any other remedy by the Agent, shall be applied as follows:
(i) first, to reimburse the Agent and the Banks
for out-of-pocket costs, expenses and disbursements, including reasonable
attorneys' and paralegals' fees and legal expenses, incurred by the Agent or the
Banks in connection with realizing on the Collateral or collection of any
Obligations of any of the Loan Parties under any of the Loan Documents,
including advances made by the Banks or any one of them or the Agent for the
reasonable maintenance, preservation, protection or enforcement of, or
realization upon, the Collateral, including advances for taxes, insurance,
repairs and the like and reasonable expenses incurred to sell or otherwise
realize on, or prepare for sale or other realization on, any of the Collateral;
(ii) second, to the repayment of all Obligations
then due and unpaid of the Loan Parties to the Banks incurred under this
Agreement or any of the other Loan Documents or a Bank-Provided Interest Rate
Hedge, whether of principal, interest, fees, expenses or otherwise, in such
manner as the Agent may determine in its discretion; and
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(iii) the balance, if any, as required by Law.
8.2.5.2 COLLATERAL SHARING.
All Liens granted under the Patent, Trademark and
Copyright Assignment, the Pledge Agreement and the Security Agreement and any
other Loan Document (the "Collateral Documents") shall secure ratably and on a
pari passu basis (i) the Obligations in favor of the Agent and the Banks
hereunder and (ii) the Obligations incurred by any of the Loan Parties in favor
of any Bank which provides a Bank-Provided Interest Rate Hedge (the "IRH
Provider"). The Agent under the Collateral Documents shall be deemed to serve as
the collateral agent (the "Collateral Agent") for the IRH Provider and the Banks
hereunder, provided that the Collateral Agent shall comply with the instructions
and directions of the Agent (or the Banks under this Agreement to the extent
that this Agreement or any other Loan Documents empowers the Banks to direct the
Agent), as to all matters relating to the Collateral, including the maintenance
and disposition thereof. No IRH Provider (except in its capacity as a Bank
hereunder) shall be entitled or have the power to direct or instruct the
Collateral Agent on any such matters or to control or direct in any manner the
maintenance or disposition of the Collateral.
8.2.6. OTHER RIGHTS AND REMEDIES.
In addition to all of the rights and remedies contained in
this Agreement or in any of the other Loan Documents, the Agent shall have all
of the rights and remedies of a secured party under the Uniform Commercial Code
or other applicable Law, all of which rights and remedies shall be cumulative
and non-exclusive, to the extent permitted by Law. The Agent may, and upon the
request of the Required Banks shall, exercise all post-default rights granted to
the Agent and the Banks under the Loan Documents or applicable Law.
8.3 NOTICE OF SALE.
Any notice required to be given by the Agent of a sale, lease, or
other disposition of the Collateral or any other intended action by the Agent,
if given ten (10) days prior to such proposed action, shall constitute
commercially reasonable and fair notice thereof to the Borrower.
9. THE AGENT
9.1 APPOINTMENT.
Each Bank hereby irrevocably designates, appoints and authorizes
PNC Bank to act as Agent for such Bank under this Agreement and to execute and
deliver or accept on behalf of each of the Banks the other Loan Documents. Each
Bank hereby irrevocably authorizes, and each holder of any Note by the
acceptance of a Note shall be deemed irrevocably to authorize, the Agent to take
such action on its behalf under the provisions of this Agreement and the other
Loan Documents and any other instruments and agreements referred to herein, and
to exercise such powers and to perform such duties hereunder as are specifically
delegated to or required of the
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Agent by the terms hereof, together with such powers as are reasonably
incidental thereto. PNC Bank agrees to act as the Agent on behalf of the Banks
to the extent provided in this Agreement.
9.2 DELEGATION OF DUTIES.
The Agent may perform any of its duties hereunder by or through
agents or employees (PROVIDED such delegation does not constitute a
relinquishment of its duties as Agent) and, subject to Sections 9.5
[Reimbursement of Agent by Borrower, Etc.] and 9.6, shall be entitled to engage
and pay for the advice or services of any attorneys, accountants or other
experts concerning all matters pertaining to its duties hereunder and to rely
upon any advice so obtained.
9.3 NATURE OF DUTIES; INDEPENDENT CREDIT INVESTIGATION.
The Agent shall have no duties or responsibilities except those
expressly set forth in this Agreement and no implied covenants, functions,
responsibilities, duties, obligations, or liabilities shall be read into this
Agreement or otherwise exist. The duties of the Agent shall be mechanical and
administrative in nature; the Agent shall not have by reason of this Agreement a
fiduciary or trust relationship in respect of any Bank; and nothing in this
Agreement, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Agreement except as
expressly set forth herein. Without limiting the generality of the foregoing,
the use of the term "agent" in this Agreement with reference to the Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties. Each
Bank expressly acknowledges (i) that the Agent has not made any representations
or warranties to it and that no act by the Agent hereafter taken, including any
review of the affairs of any of the Loan Parties, shall be deemed to constitute
any representation or warranty by the Agent to any Bank; (ii) that it has made
and will continue to make, without reliance upon the Agent, its own independent
investigation of the financial condition and affairs and its own appraisal of
the creditworthiness of each of the Loan Parties in connection with this
Agreement and the making and continuance of the Loans hereunder; and (iii)
except as expressly provided herein, that the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Bank
with any credit or other information with respect thereto, whether coming into
its possession before the making of any Loan or at any time or times thereafter.
9.4 ACTIONS IN DISCRETION OF AGENT; INSTRUCTIONS FROM THE BANKS.
The Agent agrees, upon the written request of the Required Banks,
to take or refrain from taking any action of the type specified as being within
the Agent's rights, powers or discretion herein, PROVIDED that the Agent shall
not be required to take any action which exposes the Agent to personal liability
or which is contrary to this Agreement or any other Loan Document or applicable
Law. In the absence of a request by the Required Banks, the Agent shall
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have authority, in its sole discretion, to take or not to take any such action,
unless this Agreement specifically requires the consent of the Required Banks or
all of the Banks. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on the Banks, subject to Section 9.6
[Exculpatory Provisions, Etc.]. Subject to the provisions of Section 9.6, no
Bank shall have any right of action whatsoever against the Agent as a result of
the Agent acting or refraining from acting hereunder in accordance with the
instructions of the Required Banks, or in the absence of such instructions, in
the absolute discretion of the Agent.
9.5 REIMBURSEMENT AND INDEMNIFICATION OF AGENT BY THE BORROWER.
The Borrower unconditionally agrees to pay or reimburse the Agent
and hold the Agent harmless against (a) liability for the payment of all
reasonable out-of-pocket costs, expenses and disbursements, including the
reasonable fees and expenses of counsel, appraisers and environmental
consultants, incurred by the Agent (i) in connection with the development,
negotiation, preparation, printing, execution, administration, syndication,
interpretation and performance of this Agreement and the other Loan Documents,
(ii) relating to any requested amendments, waivers or consents pursuant to the
provisions hereof, (iii) in connection with the enforcement of this Agreement or
any other Loan Document or collection of amounts due hereunder or thereunder or
the proof and allowability of any claim arising under this Agreement or any
other Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, and (iv) in any workout or restructuring or in connection with the
protection, preservation, exercise or enforcement of any of the terms hereof or
of any rights hereunder or under any other Loan Document or in connection with
any foreclosure, collection or bankruptcy proceedings, and (b) all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Agent, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by the Agent hereunder or thereunder, PROVIDED that
the Borrower shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements if the same results from the Agent's gross negligence
or willful misconduct, or if the Borrower was not given notice of the subject
claim and the opportunity to participate in the defense thereof, at its expense
(except that the Borrower shall remain liable to the extent such failure to give
notice does not result in a loss to the Borrower), or if the same results from a
compromise or settlement agreement entered into without the consent of the
Borrower, which shall not be unreasonably withheld. In addition, the Borrower
agrees to reimburse and pay all reasonable out-of-pocket expenses of the Agent's
regular employees and agents engaged periodically to perform audits of the Loan
Parties' books, records and business properties not to exceed one (1) such audit
per year if no Event of Default exists or is continuing (but without limitation
of number if any Event of Default exists and is continuing).
9.6 EXCULPATORY PROVISIONS; LIMITATION OF LIABILITY.
Neither the Agent nor any of its directors, officers, employees,
agents, attorneys or Affiliates shall (a) be liable to any Bank for any action
taken or omitted to be taken by it or them
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hereunder, or in connection herewith including pursuant to any Loan Document,
unless caused by its or their own gross negligence or willful misconduct, (b) be
responsible in any manner to any of the Banks for the effectiveness,
enforceability, genuineness, validity or the due execution of this Agreement or
any other Loan Documents or for any recital, representation, warranty, document,
certificate, report or statement herein or made or furnished under or in
connection with this Agreement or any other Loan Documents, or (c) be under any
obligation to any of the Banks to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions hereof or thereof on
the part of the Loan Parties, or the financial condition of the Loan Parties, or
the existence or possible existence of any Event of Default or Potential
Default. No claim may be made by any of the Loan Parties, any Bank, the Agent or
any of their respective Subsidiaries against the Agent, any Bank or any of their
respective directors, officers, employees, agents, attorneys or Affiliates, or
any of them, for any special, indirect or consequential damages or, to the
fullest extent permitted by Law, for any punitive damages in respect of any
claim or cause of action (whether based on contract, tort, statutory liability,
or any other ground) based on, arising out of or related to any Loan Document or
the transactions contemplated hereby or any act, omission or event occurring in
connection therewith, including the negotiation, documentation, administration
or collection of the Loans, and each of the Loan Parties, (for itself and on
behalf of each of its Subsidiaries), the Agent and each Bank hereby waive,
releases and agree never to xxx upon any claim for any such damages, whether
such claim now exists or hereafter arises and whether or not it is now known or
suspected to exist in its favor. Each Bank agrees that, except for notices,
reports and other documents expressly required to be furnished to the Banks by
the Agent hereunder or given to the Agent for the account of or with copies for
the Banks, the Agent and each of its directors, officers, employees, agents,
attorneys or Affiliates shall not have any duty or responsibility to provide any
Bank with an credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Loan Parties which may come into the possession of the Agent or any of its
directors, officers, employees, agents, attorneys or Affiliates.
9.7 REIMBURSEMENT AND INDEMNIFICATION OF AGENT BY BANKS.
Each Bank agrees to reimburse and indemnify the Agent (to the
extent not reimbursed by the Borrower and without limiting the Obligation of the
Borrower to do so) in proportion to its Ratable Share from and against all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements, including attorneys' fees and disbursements
(including the allocated costs of staff counsel), and costs of appraisers and
environmental consultants, of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Agent, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by the Agent hereunder or thereunder, PROVIDED that
no Bank shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements (a) if the same results from the Agent's gross negligence or
willful misconduct, or (b) if such Bank was not given notice of the subject
claim and the opportunity to participate in the defense thereof, at its expense
(except that such Bank shall remain liable to the extent such
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failure to give notice does not result in a loss to the Bank), or (c) if the
same results from a compromise and settlement agreement entered into without the
consent of such Bank, which shall not be unreasonably withheld. In addition,
each Bank agrees promptly upon demand to reimburse the Agent (to the extent not
reimbursed by the Borrower and without limiting the Obligation of the Borrower
to do so) in proportion to its Ratable Share for all amounts due and payable by
the Borrower to the Agent in connection with the Agent's periodic audit of the
Loan Parties' books, records and business properties.
9.8 RELIANCE BY AGENT.
The Agent shall be entitled to rely upon any writing, telegram,
telex or teletype message, resolution, notice, consent, certificate, letter,
cablegram, statement, order or other document or conversation by telephone or
otherwise believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons, and upon the advice and opinions of
counsel and other professional advisers selected by the Agent. The Agent shall
be fully justified in failing or refusing to take any action hereunder unless it
shall first be indemnified to its satisfaction by the Banks against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.
9.9 NOTICE OF DEFAULT.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Potential Default or Event of Default unless the Agent has
received written notice from a Bank or the Borrower referring to this Agreement,
describing such Potential Default or Event of Default and stating that such
notice is a "notice of default."
9.10 NOTICES.
The Agent shall promptly send to each Bank a copy of all notices
received from the Borrower pursuant to the provisions of this Agreement or the
other Loan Documents promptly upon receipt thereof. The Agent shall promptly
notify the Borrower and the other Banks of each change in the Base Rate and the
effective date thereof.
9.11 BANKS IN THEIR INDIVIDUAL CAPACITIES; AGENT IN ITS INDIVIDUAL
CAPACITY.
With respect to its Commitments and the Loans made by it and any
other rights and powers given to it as a Bank hereunder or under any of the
other Loan Documents, the Agent shall have the same rights and powers hereunder
as any other Bank and may exercise the same as though it were not the Agent, and
the term "Bank" and "Banks" shall, unless the context otherwise indicates,
include the Agent in its individual capacity. PNC Bank and its Affiliates and
each of the Banks and their respective Affiliates may, without liability to
account, except as prohibited herein, make loans to, issue letters of credit for
the account of, acquire equity interests in, accept deposits from, discount
drafts for, act as trustee under indentures of, and generally engage in any kind
of banking, trust, financial advisory, underwriting or other business with, the
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Loan Parties and their Affiliates, in the case of the Agent, as though it were
not acting as Agent hereunder and in the case of each Bank, as though such Bank
were not a Bank hereunder, in each case without notice to or consent of the
other Banks. The Banks acknowledge that, pursuant to such activities, the Agent
or its Affiliates may (i) receive information regarding the Loan Parties or any
of their Subsidiaries or Affiliates (including information that may be subject
to confidentiality obligations in favor of the Loan Parties or such Subsidiary
or Affiliate) and acknowledge that the Agent shall be under no obligation to
provide such information to them, and (ii) accept fees and other consideration
from the Loan Parties for services in connection with this Agreement and
otherwise without having to account for the same to the Banks.
9.12 HOLDERS OF NOTES.
The Agent may deem and treat any payee of any Note as the owner
thereof for all purposes hereof unless and until written notice of the
assignment or transfer thereof shall have been filed with the 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 or assignee of such
Note or of any Note or Notes issued in exchange therefor.
9.13 EQUALIZATION OF BANKS.
The Banks and the holders of any participations in any Notes agree
among themselves that, with respect to all amounts received by any Bank or any
such holder for application on any Obligation hereunder or under any Note or
under any such participation, whether received by voluntary payment, by
realization upon security, by the exercise of the right of set-off or banker's
lien, by counterclaim or by any other non-pro rata source, equitable adjustment
will be made in the manner stated in the following sentence so that, in effect,
all such excess amounts will be shared ratably among the Banks and such holders
in proportion to their interests in payments under the Notes, except as
otherwise provided in Section 3.4.3 [Agent's and Bank's Rights], 4.4.2
[Replacement of a Bank] or 4.6 [Additional Compensation in Certain
Circumstances]. The Banks or any such holder receiving any such amount shall
purchase for cash from each of the other Banks an interest in such Bank's Loans
in such amount as shall result in a ratable participation by the Banks and each
such holder in the aggregate unpaid amount under the Notes, PROVIDED that if all
or any portion of such excess amount is thereafter recovered from the Bank or
the holder making such purchase, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, together with interest
or other amounts, if any, required by law (including court order) to be paid by
the Bank or the holder making such purchase.
9.14 SUCCESSOR AGENT.
The Agent (i) may resign as Agent or (ii) shall resign if such
resignation is requested by the Required Banks (if the Agent is a Bank, the
Agent's Loans and its Revolving Credit Commitment shall be considered in
determining whether the Required Banks have
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requested such resignation) or required by Section 4.4.2 [Replacement of a
Bank], in either case of (i) or (ii) by giving not less than thirty (30) days'
prior written notice to the Borrower. If the Agent shall resign under this
Agreement, then either (a) the Required Banks shall appoint from among the Banks
a successor agent for the Banks, subject to the consent of the Borrower, such
consent not to be unreasonably withheld, or (b) if a successor agent shall not
be so appointed and approved within the thirty (30) day period following the
Agent's notice to the Banks of its resignation, then the Agent shall appoint,
with the consent of the Borrower, such consent not to be unreasonably withheld,
a successor agent who shall serve as Agent until such time as the Required Banks
appoint and the Borrower consents to the appointment of a successor agent. Upon
its appointment pursuant to either clause (a) or (b) above, such successor agent
shall succeed to the rights, powers and duties of the Agent, and the term
"Agent" shall mean such successor agent, effective upon its appointment, and the
former Agent's rights, powers and duties as Agent shall be terminated without
any other or further act or deed on the part of such former Agent or any of the
parties to this Agreement. After the resignation of any Agent hereunder, the
provisions of this Section 9 shall inure to the benefit of such former Agent and
such former Agent shall not by reason of such resignation be deemed to be
released from liability for any actions taken or not taken by it while it was an
Agent under this Agreement.
9.15 AGENT'S FEE.
The Borrower shall pay to the Agent a nonrefundable fee (the
"Agent's Fee") under the terms of a letter (the "Agent's Letter") between the
Borrower and Agent, as amended from time to time.
9.16 AVAILABILITY OF FUNDS.
The Agent may assume that each Bank has made or will make the
proceeds of a Loan available to the Agent unless the Agent shall have been
notified by such Bank on or before the later of (1) the close of Business on the
Business Day preceding the Borrowing Date with respect to such Loan or two (2)
hours before the time on which the Agent actually funds the proceeds of such
Loan to the Borrower (whether using its own funds pursuant to this Section 9.16
or using proceeds deposited with the Agent by the Banks and whether such funding
occurs before or after the time on which Banks are required to deposit the
proceeds of such Loan with the Agent). The Agent may, in reliance upon such
assumption (but shall not be required to), make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made available
to the Agent by such Bank, the Agent shall be entitled to recover such amount on
demand from such Bank (or, if such Bank fails to pay such amount forthwith upon
such demand from the Borrower) together with interest thereon, in respect of
each day during the period commencing on the date such amount was made available
to the Borrower and ending on the date the Agent recovers such amount, at a rate
per annum equal to (i) the Federal Funds Effective Rate during the first three
(3) days after such interest shall begin to accrue and (ii) the applicable
interest rate in respect of such Loan after the end of such three-day period.
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9.17 CALCULATIONS.
In the absence of gross negligence or willful misconduct, the
Agent shall not be liable for any error in computing the amount payable to any
Bank whether in respect of the Loans, fees or any other amounts due to the Banks
under this Agreement. In the event an error in computing any amount payable to
any Bank is made, the Agent, the Borrower and each affected Bank shall,
forthwith upon discovery of such error, make such adjustments as shall be
required to correct such error, and any compensation therefor will be calculated
at the Federal Funds Effective Rate.
9.18 BENEFICIARIES.
Except as expressly provided herein, the provisions of this
Section 9 are solely for the benefit of the Agent and the Banks, and the Loan
Parties shall not have any rights to rely on or enforce any of the provisions
hereof. In performing its functions and duties under this Agreement, the Agent
shall act solely as agent of the Banks and does not assume and shall not be
deemed to have assumed any obligation toward or relationship of agency or trust
with or for any of the Loan Parties.
10. MISCELLANEOUS
10.1 MODIFICATIONS, AMENDMENTS OR WAIVERS.
With the written consent of the Required Banks, the Agent, acting
on behalf of all the Banks, and the Borrower, on behalf of the Loan Parties, may
from time to time enter into written agreements amending or changing any
provision of this Agreement or any other Loan Document or the rights of the
Banks or the Loan Parties hereunder or thereunder, or may grant written waivers
or consents to a departure from the due performance of the Obligations of the
Loan Parties hereunder or thereunder. Any such agreement, waiver or consent made
with such written consent shall be effective to bind all the Banks and the Loan
Parties; PROVIDED, that, without the written consent of all the Banks, no such
agreement, waiver or consent may be made which will:
10.1.1. INCREASE OF COMMITMENT; EXTENSION OF EXPIRATION DATE.
Increase the amount of the Revolving Credit Commitment of
any Bank hereunder or extend the Expiration Date;
10.1.2. EXTENSION OF PAYMENT; REDUCTION OF PRINCIPAL INTEREST OR
FEES; MODIFICATION OF TERMS OF PAYMENT.
Whether or not any Loans are outstanding, extend the time
for payment of principal or interest of any Loan (excluding the due date of any
mandatory prepayment of a Loan or any mandatory Commitment reduction in
connection with such a mandatory prepayment
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hereunder except for mandatory reductions of the Commitments on the Expiration
Date), the Revolving Credit Commitment Fees or any other fee payable to any
Bank, or reduce the principal amount of or the rate of interest borne by any
Loan or reduce the Revolving Credit Commitment Fees or any other fee payable to
any Bank, or otherwise affect the terms of payment of the principal of or
interest of any Loan, the Revolving Credit Commitment Fees or any other fee
payable to any Bank;
10.1.3. RELEASE OF COLLATERAL OR GUARANTOR.
Except for transactions permitted by Section 7.2.6
[Liquidations, Mergers etc.] and for sales of assets permitted by Section 7.2.7
[Disposition of Assets or Subsidiaries], release any Collateral consisting of
capital stock or other ownership interests of any Loan Party or its Subsidiary
or substantially all of the assets of any Loan Party, any Guarantor from its
Obligations under the Guaranty Agreement or any other security for any of the
Loan Parties' Obligations; or
10.1.4. MISCELLANEOUS.
Amend Section 4.2 [Pro Rata Treatment of Banks], 9.6
[Exculpatory Provisions, Etc.] or 9.13 [Equalization of Banks] or this Section
10.1, alter any provision regarding the pro rata treatment of the Banks, change
the definition of Required Banks, or change any requirement providing for the
Banks or the Required Banks to authorize the taking of any action hereunder;
PROVIDED, further, that no agreement, waiver or consent which would modify the
interests, rights or obligations of the Agent in its capacity as Agent or as the
issuer of Letters of Credit shall be effective without the written consent of
the Agent.
10.2 NO IMPLIED WAIVERS; CUMULATIVE REMEDIES; WRITING REQUIRED.
No course of dealing and no delay or failure of the Agent or any
Bank in exercising any right, power, remedy or privilege under this Agreement or
any other Loan Document shall affect any other or future exercise thereof or
operate as a waiver thereof, nor shall any single or partial exercise thereof or
any abandonment or discontinuance of steps to enforce such a right, power,
remedy or privilege preclude any further exercise thereof or of any other right,
power, remedy or privilege. The rights and remedies of the Agent and the Banks
under this Agreement and any other Loan Documents are cumulative and not
exclusive of any rights or remedies which they would otherwise have. Any waiver,
permit, consent or approval of any kind or character on the part of any Bank of
any breach or default under this Agreement or any such waiver of any provision
or condition of this Agreement must be in writing and shall be effective only to
the extent specifically set forth in such writing.
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10.3 REIMBURSEMENT AND INDEMNIFICATION OF BANKS BY THE BORROWER; TAXES.
The Borrower agrees unconditionally upon demand to pay or
reimburse to each Bank (other than the Agent, as to which the Borrower's
Obligations are set forth in Section 9.5 [Reimbursement of Agent By Borrower,
Etc.]) and to save such Bank harmless against (i) liability for the payment of
all reasonable out-of-pocket costs, expenses and disbursements (including
reasonable fees and expenses of counsel for each Bank except with respect to (a)
and (b) below), incurred by such Bank (a) in connection with the administration
and interpretation of this Agreement, and other instruments and documents to be
delivered hereunder, (b) relating to any amendments, waivers or consents
pursuant to the provisions hereof, (c) in connection with the enforcement of
this Agreement or any other Loan Document, or collection of amounts due
hereunder or thereunder or the proof and allowability of any claim arising under
this Agreement or any other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, and (d) in any workout or restructuring or in
connection with the protection, preservation, exercise or enforcement of any of
the terms hereof or of any rights hereunder or under any other Loan Document or
in connection with any foreclosure, collection or bankruptcy proceedings, or
(ii) all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against such Bank,
in its capacity as such, in any way relating to or arising out of this Agreement
or any other Loan Documents or any action taken or omitted by such Bank
hereunder or thereunder, PROVIDED that the Borrower shall not be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements (A) if the same results from
such Bank's gross negligence or willful misconduct, or (B) if the Borrower was
not given notice of the subject claim and the opportunity to participate in the
defense thereof, at its expense (except that the Borrower shall remain liable to
the extent such failure to give notice does not result in a loss to the
Borrower), or (C) if the same results from a compromise or settlement agreement
entered into without the consent of the Borrower, which shall not be
unreasonably withheld. The Banks will attempt to minimize the fees and expenses
of legal counsel for the Banks which are subject to reimbursement by the
Borrower hereunder by considering the usage of one law firm to represent the
Banks and the Agent if appropriate under the circumstances. The Borrower agrees
unconditionally to pay all stamp, document, transfer, recording or filing taxes
or fees and similar impositions now or hereafter determined by the Agent or any
Bank to be payable in connection with this Agreement or any other Loan Document,
and the Borrower agrees unconditionally to save the Agent and the Banks harmless
from and against any and all present or future claims, liabilities or losses
with respect to or resulting from any omission to pay or delay in paying any
such taxes, fees or impositions, unless the same is caused by their gross
negligence or willful misconduct.
10.4 HOLIDAYS.
Whenever payment of a Loan to be made or taken hereunder shall be
due on a day which is not a Business Day such payment shall be due on the next
Business Day (except as provided in Section 3.2 [Interest Periods] with respect
to Revolving Credit Interest Periods under the Euro-Rate Option) and such
extension of time shall be included in computing interest and
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fees, except that the Loans shall be due on the Business Day preceding the
Expiration Date if the Expiration Date is not a Business Day. Whenever any
payment or action to be made or taken hereunder (other than payment of the
Loans) shall be stated to be due on a day which is not a Business Day, such
payment or action shall be made or taken on the next following Business Day, and
such extension of time shall not be included in computing interest or fees, if
any, in connection with such payment or action.
10.5 FUNDING BY BRANCH, SUBSIDIARY OR AFFILIATE.
10.5.1. NOTIONAL FUNDING.
Each Bank shall have the right from time to time, without
notice to the Borrower, to deem any branch, Subsidiary or Affiliate (which for
the purposes of this Section 10.5 shall mean any corporation or association
which is directly or indirectly controlled by or is under direct or indirect
common control with any corporation or association which directly or indirectly
controls such Bank) of such Bank to have made, maintained or funded any Loan to
which the Euro-Rate Option applies at any time, PROVIDED that immediately
following (on the assumption that a payment were then due from the Borrower to
such other office), and as a result of such change, the Borrower would not be
under any greater financial obligation pursuant to Sections 3.4 [Euro-Rate
Unascertainable], 4.4 [Voluntary Prepayments], or 4.6 [Additional Compensation
in Certain Circumstances] than it would have been in the absence of such change.
Notional funding offices may be selected by each Bank without regard to such
Bank's actual methods of making, maintaining or funding the Loans or any sources
of funding actually used by or available to such Bank.
10.5.2. ACTUAL FUNDING.
Each Bank shall have the right from time to time to make
or maintain any Loan by arranging for a branch, Subsidiary or Affiliate of such
Bank to make or maintain such Loan subject to the last sentence of this Section
10.5.2. If any Bank causes a branch, Subsidiary or Affiliate to make or maintain
any part of the Loans hereunder, all terms and conditions of this Agreement
shall, except where the context clearly requires otherwise, be applicable to
such part of the Loans to the same extent as if such Loans were made or
maintained by such Bank, but in no event shall any Bank's use of such a branch,
Subsidiary or Affiliate to make or maintain any part of the Loans hereunder
cause such Bank or such branch, Subsidiary or Affiliate to incur any cost or
expenses payable by the Borrower hereunder or require the Borrower to pay any
other compensation to any Bank (including any expenses incurred or payable
pursuant to Sections 3.4 [Euro-Rate Unascertainable], 4.4 [Voluntary
Prepayments], or 4.6 [Additional Compensation in Certain Circumstances]) which
would otherwise not be incurred.
10.6 NOTICES.
Any notice, request, demand, direction or other communication (for
purposes of this Section 10.6 only, a "Notice") to be given to or made upon any
party hereto under any
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provision of this Agreement shall be given or made by telephone or in writing
(which includes means of electronic transmission (i.e., "e-mail") or facsimile
transmission or by setting forth such Notice on a site on the World Wide Web (a
"Website Posting") if Notice of such Website Posting (including the information
necessary to access such site) has previously been delivered to the applicable
parties hereto by another means set forth in this Section 10.6) in accordance
with this Section 10.6. Any such Notice must be delivered to the applicable
parties hereto at the addresses and numbers set forth under their respective
names on Schedule 1.1(B) hereof or in accordance with any subsequent unrevoked
Notice from any such party that is given in accordance with this Section 10.6.
Any Notice shall be effective:
(i) In the case of hand-delivery, when delivered;
(ii) If given by mail, four (4) days after such
Notice is deposited with the United States Postal Service, with first-class
postage prepaid, return receipt requested;
(iii) In the case of a telephonic Notice, when a
party is contacted by telephone, if delivery of such telephonic Notice is
confirmed no later than the next Business Day by hand delivery, a facsimile or
electronic transmission, a Website Posting or overnight courier delivery of a
confirmatory notice (received at or before noon on such next Business Day);
(iv) In the case of a facsimile transmission, when
sent to the applicable party's facsimile machine's telephone number if the party
sending such Notice receives confirmation of the delivery thereof from its own
facsimile machine;
(v) In the case of electronic transmission, when
actually received;
(vi) In the case of a Website Posting, upon delivery
of a Notice of such posting (including the information necessary to access such
web site) by another means set forth in this Section 10.6; and
(vii) If given by any other means (including by
overnight courier), when actually received.
Any Bank giving a Notice to a Loan Party shall concurrently send a copy thereof
to the Agent, and the Agent shall promptly notify the other Banks of its receipt
of such Notice.
10.7 SEVERABILITY.
The provisions of this Agreement are intended to be severable. If
any provision of this Agreement shall be held invalid or unenforceable in whole
or in part in any jurisdiction, such provision shall, as to such jurisdiction,
be ineffective to the extent of such invalidity or
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unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.
10.8 GOVERNING LAW.
Each Letter of Credit and Section 2.10 [Letter of Credit
Subfacility] shall be subject to the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, as the same may be revised or amended from time to time,
and to the extent not inconsistent therewith, the internal laws of the
Commonwealth of Pennsylvania without regard to its conflict of laws principles,
and the balance of this Agreement shall be deemed to be a contract under the
Laws of the Commonwealth of Pennsylvania and for all purposes shall be governed
by and construed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania without regard to its conflict of laws principles.
10.9 PRIOR UNDERSTANDING.
This Agreement and the other Loan Documents supersede all prior
understandings and agreements, whether written or oral, between the parties
hereto and thereto relating to the transactions provided for herein and therein,
including any prior confidentiality agreements and commitments.
10.10 DURATION; SURVIVAL.
All representations and warranties of the Loan Parties contained
herein or made in connection herewith shall survive the making of Loans and
issuance of Letters of Credit and shall not be waived by the execution and
delivery of this Agreement, any investigation by the Agent or the Banks, the
making of Loans, issuance of Letters of Credit, or payment in full of the Loans.
All covenants and agreements of the Loan Parties contained in Sections 7.1
[Affirmative Covenants], 7.2 [Negative Covenants] and 7.3 [Reporting
Requirements] herein shall continue in full force and effect from and after the
date hereof so long as the Borrower may borrow or request Letters of Credit
hereunder and until termination of the Commitments and payment in full of the
Loans and expiration or termination of all Letters of Credit. All covenants and
agreements of the Borrower contained herein relating to the payment of
principal, interest, premiums, additional compensation or expenses and
indemnification, including those set forth in the Notes, Section 4 [Payments]
and Sections 9.5 [Reimbursement of Agent by Borrower, Etc.], 9.7 [Reimbursement
of Agent by Banks, Etc.] and 10.3 [Reimbursement of Banks by Borrower; Etc.],
shall survive payment in full of the Loans, expiration or termination of the
Letters of Credit and termination of the Commitments.
10.11 SUCCESSORS AND ASSIGNS.
(i) This Agreement shall be binding upon and shall
inure to the benefit of the Banks, the Agent, the Loan Parties and their
respective successors and
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assigns, except that none of the Loan Parties may assign or transfer any of its
rights and Obligations hereunder or any interest herein. Each Bank may, at its
own cost, make assignments of or sell participations in all or any part of its
Commitments and the Loans made by it to one or more banks or other entities,
subject to the consent of the Borrower and the Agent with respect to any
assignee, such consent not to be unreasonably withheld, PROVIDED that (1) no
consent of the Borrower shall be required (A) if an Event of Default exists and
is continuing, or (B) in the case of an assignment by a Bank to an Affiliate of
such Bank, and (2) any assignment by a Bank to a Person other than an Affiliate
of such Bank may not be made in amounts less than the lesser of $5,000,000 or
the amount of the assigning Bank's Commitment. In the case of an assignment,
upon receipt by the Agent of the assignment and assumption agreement in a form
acceptable to the Agent, the assignee shall have, to the extent of such
assignment (unless otherwise provided therein), the same rights, benefits and
obligations as it would have if it had been a signatory Bank hereunder, the
Commitments shall be adjusted accordingly, and upon surrender of any Note
subject to such assignment, the Borrower shall execute and deliver a new Note to
the assignee in an amount equal to the amount of the Commitment assumed by it
and a new Note to the assigning Bank in an amount equal to the Commitment
retained by it hereunder. Any Bank which assigns any or all of its Commitment or
Loans to a Person other than an Affiliate of such Bank shall pay to the Agent a
service fee in the amount of $3,500 for each assignment. In the case of a
participation, the participant shall only have the rights specified in Section
8.2.3 [Set-off] (the participant's rights against such Bank in respect of such
participation to be those set forth in the agreement executed by such Bank in
favor of the participant relating thereto and not to include any voting rights
except with respect to changes of the type referenced in Sections 10.1.1
[Increase of Commitment, Etc.], 10.1.2 [Extension of Payment, Etc.], or 10.1.3
[Release of Collateral or Guarantor]), all of such Bank's obligations under this
Agreement or any other Loan Document shall remain unchanged, and all amounts
payable by any Loan Party hereunder or thereunder shall be determined as if such
Bank had not sold such participation.
(ii) Any assignee or participant which is not
incorporated under the Laws of the United States of America or a state thereof
shall deliver to the Borrower and the Agent the form of certificate described in
Section 10.18 [Tax Withholding Clause] relating to federal income tax
withholding. Each Bank may furnish any publicly available information concerning
any Loan Party or its Subsidiaries and any other information concerning any Loan
Party or its Subsidiaries in the possession of such Bank from time to time to
assignees and participants (including prospective assignees or participants),
PROVIDED that such assignees and participants agree to be bound by the
provisions of Section 10.13 [Confidentiality].
(iii) Notwithstanding any other provision in this
Agreement, any Bank may at any time pledge or grant a security interest in all
or any portion of its rights under this Agreement, its Note and the other Loan
Documents to any Federal Reserve Bank in accordance with Regulation A of the FRB
or U.S. Treasury Regulation 31 CFR Section 203.14 without notice to or consent
of the Borrower or the Agent. No such pledge or grant of a security interest
shall release the transferor Bank of its obligations hereunder or under any
other Loan Document.
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10.12 ADDITIONAL BANK.
Any Additional Bank which is to become a party to this Agreement
pursuant to Section 2.9 hereof or otherwise shall execute and deliver to Agent a
Bank Joinder to this Agreement in substantially the form attached hereto as
EXHIBIT 1.1(b). Upon execution and delivery of a Bank Joinder, such Additional
Bank shall be a party hereto and a Bank under each of the Loan Documents for all
purposes. On the date of such Bank Joinder, the Borrower shall repay all of the
outstanding Revolving Credit Loans (subject to the Borrower's indemnity
obligations in Section 4.6.2(i)) and any reborrowings shall be allocated to the
existing Banks and such Additional Bank based on their ratable shares after such
Bank Joinder becomes effective. Simultaneously with the execution and delivery
of such Bank Joinder, Borrower shall execute a Revolving Credit Note, and
deliver such Note to such Additional Bank.
10.13 CONFIDENTIALITY.
10.13.1. GENERAL.
The Agent and the Banks each agree to keep confidential
all information obtained from any Loan Party or its Subsidiaries which is
nonpublic and confidential or proprietary in nature (including any information
the Borrower specifically designates as confidential), except as provided below,
and to use such information only in connection with their respective capacities
under this Agreement and for the purposes contemplated hereby. The Agent and the
Banks shall be permitted to disclose such information (i) to outside legal
counsel, accountants and other professional advisors who need to know such
information in connection with the administration and enforcement of this
Agreement, subject to agreement of such Persons to maintain the confidentiality,
(ii) to assignees and participants as contemplated by Section 10.11, and
prospective assignees and participants, subject to the agreement of such Person
to maintain the confidentiality thereof, (iii) to the extent requested by any
bank regulatory authority or, with notice to the Borrower, as otherwise required
by applicable Law or by any subpoena or similar legal process, or in connection
with any investigation or proceeding arising out of the transactions
contemplated by this Agreement, (iv) if it becomes publicly available other than
as a result of a breach of this Agreement or becomes available from a source not
known to be subject to confidentiality restrictions, or (v) if the Borrower
shall have consented to such disclosure.
10.13.2. SHARING INFORMATION WITH AFFILIATES OF THE BANKS.
Each Loan Party acknowledges that from time to time
financial advisory, investment banking and other services may be offered or
provided to the Borrower or one or more of its Affiliates (in connection with
this Agreement or otherwise) by any Bank or by one or more Subsidiaries or
Affiliates of such Bank and each of the Loan Parties hereby authorizes each Bank
to share any information delivered to such Bank by such Loan Party and its
Subsidiaries pursuant to this Agreement, or in connection with the decision of
such Bank to enter into this Agreement, to any such Subsidiary or Affiliate of
such Bank, it being understood that any such
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Subsidiary or affiliate of any Bank receiving such information shall be bound by
the provisions of Section 10.13.1 as if it were a Bank hereunder. Such
Authorization shall survive the repayment of the Loans and other Obligations and
the termination of the Commitments.
10.14 COUNTERPARTS.
This Agreement may be executed by different parties hereto on any
number of separate counterparts, each of which, when so executed and delivered,
shall be an original, and all such counterparts shall together constitute one
and the same instrument.
10.15 AGENT'S OR BANK'S CONSENT.
Whenever the Agent's or any Bank's consent is required to be
obtained under this Agreement or any of the other Loan Documents as a condition
to any action, inaction, condition or event, except as expressly provided herein
or therein, the Agent and each Bank shall be authorized to give or withhold such
consent in its sole and absolute discretion and to condition its consent upon
the giving of additional collateral, the payment of money or any other matter.
10.16 EXCEPTIONS.
The representations, warranties and covenants contained herein
shall be independent of each other, and no exception to any representation,
warranty or covenant shall be deemed to be an exception to any other
representation, warranty or covenant contained herein unless expressly provided,
nor shall any such exceptions be deemed to permit any action or omission that
would be in contravention of applicable Law.
10.17 CONSENT TO FORUM; WAIVER OF JURY TRIAL.
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EACH LOAN PARTY HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY AND THE UNITED
STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA, AND WAIVES
PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH
SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN
PARTY AT THE ADDRESSES PROVIDED FOR IN SECTION 10.6 AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS
PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF
JURISDICTION OR VENUE. EACH LOAN PARTY, THE AGENT AND THE BANKS HEREBY WAIVE
TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND
ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.
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10.18 TAX WITHHOLDING CLAUSE.
Each Bank or assignee or participant of a Bank that is not
incorporated under the Laws of the United States of America or a state thereof
(and, upon the written request of the Agent, each other Bank or assignee or
participant of a Bank) agrees that it will deliver to each of the Borrower and
the Agent two (2) duly completed appropriate valid Withholding Certificates (as
defined under ss. 1.1441-1(c)(16) of the Income Tax Regulations (the
"Regulations")) certifying its status (i.e. U.S. or foreign person) and, if
appropriate, making a claim of reduced, or exemption from, U.S. withholding tax
on the basis of an income tax treaty or an exemption provided by the Internal
Revenue Code. The term "Withholding Certificate" means a Form W-9; a Form
W-8BEN; a Form W-8ECI; a Form W-8IMY and the related statements and
certifications as required under ss. 1.1441-1(e)(2) and/or (3) of the
Regulations; a statement described in ss. 1.871-14(c)(2)(v) of the Regulations;
or any other certificates under the Internal Revenue Code or Regulations that
certify or establish the status of a payee or beneficial owner as a U.S. or
foreign person. Each Bank, assignee or participant required to deliver to the
Borrower and the Agent a Withholding Certificate pursuant to the preceding
sentence shall deliver such valid Withholding Certificate as follows: (A) each
Bank which is a party hereto on the Closing Date shall deliver such valid
Withholding Certificate at least five (5) Business Days prior to the first date
on which any interest or fees are payable by the Borrower hereunder for the
account of such Bank; (B) each assignee or participant shall deliver such valid
Withholding Certificate at least five (5) Business Days before the effective
date of such assignment or participation (unless the Agent in its sole
discretion shall permit such assignee or participant to deliver such valid
Withholding Certificate less than five (5) Business Days before such date in
which case it shall be due on the date specified by the Agent). Each Bank,
assignee or participant which so delivers a valid Withholding Certificate
further undertakes to deliver to each of the Borrower and the Agent two (2)
additional copies of such Withholding Certificate (or a successor form) on or
before the date that such Withholding Certificate expires or becomes obsolete or
after the occurrence of any event requiring a change in the most recent
Withholding Certificate so delivered by it, and such amendments thereto or
extensions or renewals thereof as may be reasonably requested by the Borrower or
the Agent. Notwithstanding the submission of a Withholding Certificate claiming
a reduced rate of or exemption from U.S. withholding tax, the Agent shall be
entitled to withhold United States federal income taxes at the full 30%
withholding rate if in its reasonable judgment it is required to do so under the
due diligence requirements imposed upon a withholding agent under ss.
1.1441-7(b) of the Regulations. Further, the Agent is indemnified under ss.
1.1461-1(e) of the Regulations against any claims and demands of any Bank or
assignee or participant of a Bank for the amount of any tax it deducts and
withholds in accordance with regulations under ss. 1441 of the Internal Revenue
Code.
10.19 JOINDER OF GUARANTORS.
Any Subsidiary of the Borrower which is required to join this
Agreement as a Guarantor pursuant to Section 7.2.7 [Subsidiaries, Partnerships
and Joint Ventures] shall execute and deliver to the Agent (i) a Guarantor
Joinder in substantially the form attached hereto as EXHIBIT 1.1(g)(1) pursuant
to which it shall join as a Guarantor each of the documents to which
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the Guarantors are parties; (ii) documents in the forms described in Section 6.1
[First Loans] modified as appropriate to relate to such Subsidiary; and (iii)
documents necessary to grant and perfect Prior Security Interests to the Agent
for the benefit of the Banks in all Collateral held by such Subsidiary. The Loan
Parties shall deliver such Guarantor Joinder and related documents to the Agent
within fifteen (15) Business Days after the date of the filing of such
Subsidiary's articles of incorporation if the Subsidiary is a corporation, the
date of the filing of its certificate of limited partnership if it is a limited
partnership or the date of its organization if it is an entity other than a
limited partnership or corporation.
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[SIGNATURE PAGE 1 OF 3 TO THE CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed this Agreement as of the day and year first above
written.
XXXXX CORPORATION
By:
-------------------------------------
Title:
-----------------------------------
XXXXX HOLDINGS, INC.
By:
--------------------------------------
Title:
XXXXX FACTORING COMPANY
By:
--------------------------------------
Title:
XXXXX PAYROLL, LLC
By:
--------------------------------------
Title:
SCHEDULE 1.1(B) - 1
[SIGNATURE PAGE 2 OF 3 TO THE CREDIT AGREEMENT]
XXXXX CREDIT SERVICES CORPORATION
By:
--------------------------------------
Title:
XXXXX INTERNATIONAL HOLDINGS, INC.
By:
--------------------------------------
Title:
SCHEDULE 1.1(B) - 2
[SIGNATURE PAGE 3 OF 3 TO THE CREDIT AGREEMENT]
PNC BANK, NATIONAL ASSOCIATION,
individually and as Agent
By:
--------------------------------------
Title:
-----------------------------------
SCHEDULE 1.1(B) - 3
