EXHIBIT 10.34
CREDIT AGREEMENT
DATED AS OF DECEMBER 27, 1995
AMONG
AST RESEARCH, INC.,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
ARRANGED BY
BA SECURITIES, INC.
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS 1
1.01 Certain Defined Terms 1
1.02 Other Interpretive Provisions 15
1.03 Accounting Principles 16
ARTICLE II
THE CREDITS 16
2.01 Amounts and Terms of Commitments 16
2.02 Loan Accounts 17
2.03 Procedure for Borrowing 17
2.04 Conversion and Continuation Elections 18
2.05 Voluntary Termination or Reduction of Commitments 19
2.06 Optional Prepayments 20
2.07 Repayment 20
2.08 Interest 20
2.09 Fees 21
(a) Arrangement, Agency Fees 21
(b) Commitment Fees 21
2.10 Computation of Fees and Interest 22
2.11 Payments by the Company 22
2.12 Payments by the Banks to the Agent 22
2.13 Sharing of Payments, Etc. 23
2.14 Extension of Termination Date 24
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY 24
3.01 Taxes 24
3.02 Illegality 27
3.03 Increased Costs and Reduction of Return 28
3.04 Funding Losses 29
3.05 Inability to Determine Rates 29
3.06 Invoices of Banks 30
3.07 Survival 30
3.08 Replacement Bank 30
ARTICLE IV
CONDITIONS PRECEDENT 31
4.01 Conditions of Initial Loans 31
(a) Credit Agreement and Notes 31
(b) Resolutions; Incumbency 31
(c) Organization Documents; Good Standing 32
(d) Legal Opinions 32
(e) Payment of Fees 32
(f) Certificate 32
(g) Guaranty 33
(h) Consents 33
(i) Other Documents 33
4.02 Conditions to All Borrowings 33
(a) Notice of Borrowing 33
(b) Continuation of Representations and
Warranties 33
(c) No Existing Default 33
ARTICLE V
REPRESENTATIONS AND WARRANTIES 33
5.01 Corporate Existence and Power 33
5.02 Corporate Authorization; No Contravention 34
5.03 Governmental Authorization 34
5.04 Binding Effect 34
5.05 Litigation 35
5.06 No Default 35
5.07 ERISA Compliance 35
5.08 Use of Proceeds; Margin Regulations 37
5.09 Title to Properties 37
5.10 Taxes 37
5.11 Financial Condition; No Material Adverse Change 37
5.12 Environmental Matters 38
5.13 Regulated Entities 38
5.14 No Burdensome Restrictions 39
5.15 Solvency 39
5.16 Copyrights, Patents, Trademarks and Licenses, Etc. 39
5.17 Subsidiaries 39
5.18 Full Disclosure 39
ARTICLE VI
AFFIRMATIVE COVENANTS 40
6.01 Financial Statements 40
6.02 Certificates; Other Information 40
6.03 Notices 41
6.04 Preservation of Corporate Existence, Etc. 42
6.05 Maintenance of Property 42
6.06 Insurance 42
6.07 Payment of Obligations 43
6.08 Compliance with Laws 43
6.09 Compliance with ERISA 43
6.10 Inspection of Property and Books and Records 44
6.11 Environmental Laws 44
6.12 Use of Proceeds 44
ARTICLE VII
NEGATIVE COVENANTS 44
7.01 Limitation on Liens 44
7.02 Disposition of Assets 46
7.03 Consolidations and Mergers 47
7.04 Loans and Investments 48
7.05 Transactions With Affiliates 49
7.06 Compliance With ERISA 49
7.07 Restricted Payments 50
7.08 Use of Proceeds 50
7.09 Change in Business 50
7.10 Accounting Changes 51
ARTICLE VIII
EVENTS OF DEFAULT 51
8.01 Event of Default 51
(a) Non-Payment 51
(b) Representation or Warranty 51
(c) Specific Defaults 51
(d) Other Defaults 51
(e) Cross-Default 51
(f) Insolvency; Voluntary Proceedings 52
(g) Involuntary Proceedings 52
(h) ERISA 52
(i) Monetary Judgments 53
(j) Non-Monetary Judgments 53
(k) Change of Control 53
(l) Guarantor Defaults 53
8.02 Remedies 53
8.03 Rights Not Exclusive 54
ARTICLE IX
THE AGENT 54
9.01 Appointment and Authorization; "Agent" 54
9.02 Delegation of Duties 54
9.03 Liability of Agent 55
9.04 Reliance by Agent 55
9.05 Notice of Default 56
9.06 Credit Decision 56
9.07 Indemnification of Agent 56
9.08 Agent in Individual Capacity 57
9.09 Successor Agent 57
9.10 Withholding Tax 58
ARTICLE X
MISCELLANEOUS 59
10.01 Amendments and Waivers 59
10.02 Notices 60
10.03 No Waiver; Cumulative Remedies 61
10.04 Costs and Expenses 61
10.05 Company Indemnification 62
10.06 Payments Set Aside 62
10.07 Successors and Assigns 62
10.08 Assignments, Participations, Etc. 62
10.09 Confidentiality 64
10.10 Set-off 65
10.11 Notification of Addresses, Lending Offices, Etc. 65
10.12 Counterparts 65
10.13 Severability 65
10.14 No Third Parties Benefited 66
10.15 Governing Law and Jurisdiction 66
10.16 Waiver of Jury Trial 66
10.17 Entire Agreement 66
SCHEDULES
Schedule 2.01 Commitments
Schedule 5.05 Litigation
Schedule 5.07 ERISA
Schedule 5.12 Environmental Matters
Schedule 5.17(a) Subsidiaries
Schedule 5.17(b) Affiliates
Schedule 7.01 Permitted Liens
Schedule 7.05 Transactions with Affiliates
Schedule 7.09 Permitted Changes in Business
Schedule 10.02 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinion of Company's California Counsel
Exhibit E Form of Legal Opinion of Guarantor's California Counsel
Exhibit F Form of Legal Opinion of Guarantor's Korea Counsel
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Promissory Note
Exhibit I Form of Guaranty
Exhibit J Form of Satisfaction of Conditions Certificate
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of December 20, 1995, among AST
Research, Inc., a Delaware corporation (the "Company"), the several financial
institutions from time to time party to this Agreement (collectively, the
"Banks"; individually, a "Bank"), and Bank of America National Trust and Savings
Association, as agent for the Banks.
WHEREAS, the Banks have agreed to make available to the Company a revolving
credit facility upon the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
DEFINITIONS
Certain Defined Terms The following terms have the following meanings:
"Acquiree" means any Person, control of which is to be acquired
in, or who is the target of, or will or having a division or business
that will be acquired in, an Acquisition.
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or indirectly, in
(a) the acquisition of all or substantially all of the assets of a Person,
or of any business or division of a Person, (b) the acquisition of in
excess of 50% of the capital stock, partnership interests, membership
interests or equity of any Person, or otherwise causing any Person to
become a Subsidiary, or (c) a merger or consolidation or any other
combination with another Person (other than a Person that is a Subsidiary)
provided that the Company or the Subsidiary is the surviving entity.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or indirectly,
the power to direct or cause the direction of the management and policies
of the other Person, whether through the ownership of voting securities,
membership interests, by contract, or otherwise.
"Agent" means BofA in its capacity as agent for the Banks hereunder,
and any successor agent arising under Section 9.09.
"Agent-Related Persons" means BofA and any successor agent arising
under Section 9.09, together with their respective Affiliates (including,
in the case of BofA, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Agent's Payment Office" means the address for payments set forth on
Schedule 10.02 or such other address as the Agent may from time to time
specify.
"Agreement" means this Credit Agreement.
"Applicable Margin" means
with respect to Base Rate Loans, 0%; and
with respect to Offshore Rate Loans, .25%.
"Arranger" means BA Securities, Inc., a Delaware corporation.
"Assignee" has the meaning specified in subsection 10.08(a).
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the allocated cost
of internal legal services and all disbursements of internal counsel.
"Bank" has the meaning specified in the introductory clause hereto.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. Section101, et seq.).
"Base Rate" means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in effect
for such day as publicly announced from time to time by BofA in San
Francisco, California, as its "reference rate." (The "reference rate" is a
rate set by BofA based upon various factors including BofA's costs and
desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above,
or below such announced rate.)
Any change in the reference rate announced by BofA shall take effect
at the opening of business on the day specified in the public announcement
of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"BofA" means Bank of America National Trust and Savings Association,
a national banking association.
"Borrowing" means a borrowing hereunder consisting of Loans of the
same Type made to the Company on the same day by the Banks under Article
II, and, other than in the case of Base Rate Loans, having the same
Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.03.
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banks in New York City or San Francisco are
authorized or required by law to close and, if the applicable Business Day
relates to any Offshore Rate Loan, means such a day on which dealings are
carried on in the applicable offshore dollar interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any other
law, rule or regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any bank or of any corporation
controlling a bank.
"Capital Lease Obligations" means all monetary obligations of the
Company or any of its Subsidiaries under any leasing or similar arrangement
which, in accordance with GAAP, is classified as a capital lease.
"Change of Control" means when (a) the Guarantor and it Subsidiaries
shall cease to own directly or indirectly at least 40% of the outstanding
capital stock of the Company which is entitled to vote in the election of
directors or (b) any Person other than the Guarantor and its Subsidiaries
(i) shall own, directly or indirectly, 30% or more of the outstanding
capital stock of the Company which is entitled to vote in the election of
directors or (ii) shall have the ability to elect a majority of the board
of directors of the Company.
"Closing Date" means the date on which all conditions precedent set
forth in Section 4.01 are satisfied or waived by all Banks (or, in the case
of subsection 4.01(e), waived by the Person entitled to receive such
payment).
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Commitment," as to each Bank, has the meaning specified in
Section 2.01.
"Company," has the meaning specified in the introductory paragraph
hereof.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit C.
"Consolidated Subsidiaries" means, at any time, those
Subsidiaries of the Company that in accordance with GAAP would be
consolidated with the Company for financial reporting purposes.
"Consolidated Total Assets" means, as of any date of determination,
the aggregate amount of all assets of the Company and its Subsidiaries that
would, in accordance with GAAP, be required to be shown as assets on a
consolidated balance sheet of the Company and its Subsidiaries as of such
date.
"Contingent Obligation" means, as applied to any Person, any
direct or indirect liability of that Person with respect to any
Indebtedness, lease, dividend, letter of credit or other obligation
(the "primary obligation") of another Person (the "primary obligor"),
including any obligation of that Person, whether or not contingent,
(a) to purchase, repurchase or otherwise acquire such primary
obligations or any property constituting direct or indirect security
therefor, or (b) to advance or provide funds (i) for the payment or
discharge of any such primary obligation, or (ii) to maintain working
capital or equity capital of the primary obligor or otherwise to main
tain the net worth or solvency or any balance sheet item, level of
income or financial condition of the primary obligor, or (c) to
purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation set forth above of
the ability of the primary obligor to make payment of such primary
obligation, or (d) otherwise to assure or hold harmless the holder of
any such primary obligation against loss in respect thereof. The
amount of any Contingent Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the primary obligation
outstanding at any point in time in respect of which such Contingent
Obligation is made or, if not stated or if indeterminable, the maximum
anticipated liability in respect thereof as reasonably determined by
the Company in accordance with past practices.
"Contractual Obligation" means, as to any Person, any provision of
any security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument, document
or agreement to which such Person is a party or by which it or any of its
property is bound.
"Controlled Group" means the Company and all Persons (whether
or not incorporated) under common control or treated as a single
employer with the Company pursuant to Section 414(b), (c), (m) or (o)
of the Code.
"Conversion/Continuation Date" means any date on which, under
Section 2.04, the Company (a) converts Loans of one Type to another Type,
or (b) continues as Loans of the same Type, but with a new Interest Period,
Loans having Interest Periods expiring on such date.
"Credit" means the Loans and Commitments extended hereunder.
"Default" means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
"Dollars," "dollars" and "$" each mean lawful money of the United
States.
"Eligible Assignee" means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $1,000,000,000; (b) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a combined capital
and surplus of at least $1,000,000,000, provided that such bank is acting
through a branch or agency located in the country in which it is organized
or another country which is also a member of the OECD; and (c) a Person
that is primarily engaged in the business of commercial banking and that is
(i) a Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a Bank
is a Subsidiary, or (iii) a Person of which a Bank is a Subsidiary.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental, health,
safety and land use matters.
"Environmental Permits" has the meaning specified in subsection
5.12(b).
"ERISA" means the Employee Retirement Income Security Act of 1974,
and regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the
Company or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multiemployer Plan is in reorganization; (d) the filing of a notice
of intent to terminate, the treatment of a Plan amendment as a termination
under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the
Company or any ERISA Affiliate.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate".
"Event of Default" means any of the events or circumstances
specified in Section 8.01.
"Exchange Act" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite the
caption "Federal Funds (Effective)"; or, if for any relevant day such rate
is not so published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the rates for
the last transaction in overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Agent.
"Fee Letter" has the meaning specified in subsection 2.09(a).
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are applicable to
the circumstances as of the date of determination.
"Governmental Authority" means any nation or government, any state
or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" means Samsung Electronics Co., Ltd., a Korean
corporation.
"Guaranty" means the Guaranty of the Guarantor in substantially the
form of Exhibit I.
"Hazardous Materials" means all those substances which are
regulated by, or which may form the basis of liability under, any
Environmental Law, including all substances identified under any
Environmental Law as a pollutant, contaminant, waste, solid waste,
hazardous waste, hazardous constituent, special waste, hazardous
substance, hazardous material, or toxic substance, or petroleum or
petroleum derived substance or waste.
"Indebtedness" of any Person means, without duplication,
(a) all indebtedness for borrowed money; (b) all obligations issued,
undertaken or assumed as the deferred purchase price of property or
services (other than ordinary course trade payables); (c) all
reimbursement obligations with respect to surety bonds, letters of
credit, bankers' acceptances and similar instruments (in each case,
whether or not matured); (d) all obligations evidenced by notes,
bonds, debentures or similar instruments, including obligations so
evidenced incurred in connection with the acquisition of property,
assets or businesses; (e) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred
as financing, in either case with respect to property acquired by the
Person (even though the rights and remedies of the seller or bank
under such agreement in the event of default are limited to
repossession or sale of such property; provided, however, in such case
the indebtedness shall be limited to the fair market value of such
property); (f) all Capital Lease Obligations; (g) all indebtedness
referred to in paragraphs (a) through (f) above secured by (or for
which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon or in
property (including accounts and contracts rights) owned by such
Person, even though such Person has not assumed or become liable for
the payment of such Indebtedness; and (h) all direct or indirect
guaranties in respect of and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a creditor
against loss in respect of, indebtedness or obligations of others of
the kinds referred to in paragraphs (a) through (f) above. The amount
of any Indebtedness of the kind set forth in paragraph (h) above shall
be deemed to be an amount equal to the stated or determinable amount
of Indebtedness outstanding at any point in time in respect of which
such guarantee is made or, if not stated or if indeterminable, the
amount reasonably determined by the Company in accordance with past
practices.
"Indemnified Liabilities" has the meaning specified in
Section 10.05.
"Indemnified Person" has the meaning specified in Section 10.05.
"Independent Auditor" has the meaning specified in subsection
6.01(a).
"Insolvency Proceeding" means, with respect to any Person, (a) any
case, action or proceeding with respect to such Person before any court or
other Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshalling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial
portion of its creditors; undertaken under U.S. Federal, state or foreign
law, including the Bankruptcy Code.
"Interest Payment Date" means, as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and, as
to any Base Rate Loan, the last Business Day of each calendar quarter and
each date such Loan is converted into another Type of Loan.
"Interest Period" means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two, three
or six months thereafter or on such other dates as the Agent and the Banks
in their sole discretion may agree to;
provided that:
(i) if any Interest Period would otherwise end on a day
that is not a Business Day, that Interest Period shall be extended
to the following Business Day unless, in the case of an Offshore
Rate Loan, the result of such extension would be to carry such
Interest Period into another calendar month, in which event such
Interest Period shall end on the preceding Business Day;
(ii) any Interest Period pertaining to an Offshore Rate
Loan that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Business Day of the calendar month at the end of such Interest
Period; and
(iii) no Interest Period for any Loan shall extend beyond
the Revolving Termination Date.
"Investments" has the meaning specified in Section 7.04.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Joint Venture" means a single-purpose corporation, partnership,
limited liability company, joint venture or other similar legal arrangement
(whether created by contract or conducted through a separate legal entity)
now or hereafter formed by the Company or any of its Subsidiaries with
another Person in order to conduct a common venture or enterprise with such
Person.
"Lending Office" means, as to any Bank, the office or offices of
such Bank specified as its "Lending Office" or "Domestic Lending Office" or
"Offshore Lending Office", as the case may be, on Schedule 10.02, or such
other office or offices as such Bank may from time to time notify the
Company and the Agent.
"LIBOR" means the rate of interest per annum determined by the Agent
from Telerate page 3750 to be the arithmetic mean (rounded upward to the
next 1/16th of 1%) of the rates of interest per annum at which dollar
deposits in the approximate amount of the amount of the Loan to be made or
continued as, or converted into, an Offshore Rate Loan and having a
maturity comparable to such Interest Period would be offered to major banks
in the London interbank market at their request at approximately 11:00 a.m.
(London time) two Business Days prior to the commencement of such Interest
Period. If no such quotations are available, LIBOR shall be determined by
the Agent to be the arithmetic mean, rounded upward to the nearest 1/16th
of one percent of the rates of interest per annum at which deposits in an
amount approximately equal to the aggregate amount of such Offshore Loan
requested to be borrowed, and having a maturity equal to such Interest
Period are offered to the Agent in the London Interbank Market at or about
11:00 a.m. (London time) on the second Business Day before (and for value
on) the commencement of such Interest Period.
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising
under or evidenced by any conditional sale or other title retention
agreement, the interest of a lessor under a capital lease, any financing
lease having substantially the same economic effect as any of the
foregoing, or the filing of any financing statement naming the owner of the
asset to which such lien relates as debtor, under the Uniform Commercial
Code or any comparable law) and any contingent or other agreement to
provide any of the foregoing, but not including the interest of a lessor
under an operating lease.
"Loan" means an extension of credit by a Bank to the Company under
Article II, and may be a Base Rate Loan or an Offshore Rate Loan (each, a
"Type" of Loan).
"Loan Documents" means this Agreement, any Notes, the Guaranty, the
Fee Letter and all other documents delivered to the Agent or any Bank in
connection herewith.
"Majority Banks" means at any time Banks then holding at least
66-2/3% of the then aggregate unpaid principal amount of the Loans, or, if
no such principal amount is then outstanding, Banks then having at least
66-2/3% of the Commitments.
"Margin Stock" means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
"Marketable Investments" means investments held by the Company
or any of its Subsidiaries in the form of cash equivalents or short-
term marketable securities.
"Material Adverse Effect" means (a) a material adverse change in, or
a material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of the Guarantor, the
Company or the Company and its Subsidiaries taken as a whole; (b) a
material impairment of the ability of the Guarantor or the Company to
perform under any Loan Document without default; or (c) a material adverse
effect upon the legality, validity, binding effect or enforceability
against the Company or the Guarantor of any Loan Document.
"Material Subsidiary" means any Subsidiary of the Company for which,
based upon the Company's most recent annual or quarterly consolidated and
consolidating financial statements delivered to the Agent and the Banks
pursuant to Section 6.01, the total assets of such Subsidiary exceeds five
percent of the consolidated assets of the Company and its Consolidated
Subsidiaries.
"Multiemployer Plan" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which the Company or any ERISA
Affiliate makes, is making, or is obligated to make contributions or,
during the preceding three calendar years, has made, or been obligated to
make, contributions.
"Note" means a promissory note executed by the Company in favor of a
Bank pursuant to subsection 2.02(b), in substantially the form of Exhibit
H.
"Notice of Borrowing" means a notice in substantially the form of
Exhibit A.
"Notice of Conversion/Continuation" means a notice in substantially
the form of Exhibit B.
"Notice of Lien" means any "notice of lien" or similar document
intended to be filed or recorded with any court, registry, recorder's
office, central filing office or Governmental Authority for the
purpose of evidencing, creating, perfecting or preserving the priority
of a Lien securing obligations owing to a Governmental Authority.
"Notice of Substitution" has the meaning specified in Section 3.08.
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
to any Bank, the Agent, or any Indemnified Person, whether direct or
indirect (including those acquired by assignment), absolute or contingent,
due or to become due, now existing or hereafter arising.
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum determined by the Agent by reference to LIBOR.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate.
"Organization Documents" means, for any corporation, the certificate
or articles of incorporation, the bylaws, any certificate of determination
or instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
"Other Taxes" has the meaning specified in Section 3.01(b).
"Participant" has the meaning specified in subsection 10.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA which the Company sponsors, maintains,
or to which it makes, is making, or is obligated to make contributions, or
in the case of a multiple employer plan (as described in Section 4064(a) of
ERISA) has made contributions at any time during the immediately preceding
five (5) plan years.
"Permitted Liens" has the meaning specified in Section 7.01.
"Permitted Waiver" means, in respect of any default or event of
default under any instrument or agreement evidencing any Indebtedness or
Contingent Obligation, a written waiver (including by amendment), duly
executed and delivered by the applicable creditor, permanently waiving such
default or event of default.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company sponsors or maintains or to which the Company
makes, is making, or is obligated to make contributions and includes any
Pension Plan.
"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at
such time of such Bank's Commitment divided by the combined Commitments of
all Banks.
"Qualified Plan" means a pension plan (as defined in Section 3(2) of
ERISA) intended to be tax-qualified under Section 401(a) of the Code and
which any member of the Controlled Group sponsors, maintains, or to which
it makes, is making or is obligated to make contributions, or in the case
of a multiple employer plan (as described in Section 4064(a) of ERISA) has
made contributions at any time during the immediately preceding period
covering at least five (5) plan years, but excluding any Multiemployer
Plan.
"Removed Bank" has the meaning specified in Section 3.08.
"Replacement Bank" has the meaning specified in Section 3.08.
"Reportable Event" means, any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been waived
in regulations issued by the PBGC.
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of
a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"Responsible Officer" means the chief executive officer, chief
financial officer, senior vice president, treasurer or the president of the
Company.
"Revolving Termination Date" means the earlier to occur of:
(a) December 31, 1996;
(b) 364 days after the Closing Date; and
(c) the date on which the Commitments terminate in
accordance with the provisions of this Agreement.
"Solvent" means, as to any Person at any time, that (a) the fair
value of the property of such Person is greater than the amount of such
Person's liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for
purposes of Section 101(31) of the United States Bankruptcy Code (12 U.S.C.
Section 101 et seq.); (b) the present fair saleable value of the property
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; (c) taking into account all of such Person's then-available
sources of liquidity, including borrowings, such Person is able to realize
upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the
normal course of business; and (d) 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.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership interests or
other equity interests (in the case of Persons other than corporations), is
owned or controlled directly or indirectly by the Person, or one or more of
the Subsidiaries of the Person, or a combination thereof. Unless the
context otherwise clearly requires, references herein to a "Subsidiary"
refer to a Subsidiary of the Company.
"Surety Instruments" means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, shipside bonds,
surety bonds and similar instruments.
"Tangible Net Worth" means, at any time of determination, in
respect of the Company and its Subsidiaries, determined on a xxxxxxx
dated basis, total assets (exclusive of goodwill, licensing
agreements, patents, trademarks, trade names, organization expense,
treasury stock, unamortized debt discount and premium, deferred
charges and other like intangibles) less total liabilities (including
accrued and deferred income taxes), at such time.
"Taxes" has the meaning specified in Section 3.01(a).
"Type" has the meaning specified in the definition of "Loan."
"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of
that Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"United States" and "U.S." each means the United States of America.
"Voluntary Lien" means any security agreement, pledge, assignment,
hypothecation, charge or deposit arrangement, grant of mortgage, grant of
deed of trust and any and all other Liens intentionally or voluntarily
entered into or incurred by the Company or any of its Subsidiaries.
"Wholly-Owned Subsidiary" means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of
each class having ordinary voting power, and 100% of the capital stock of
every other class, in each case, at the time as of which any determination
is being made, is owned, beneficially and of record, by the Company, or by
one or more of the other Wholly-Owned Subsidiaries, or both.
Other Interpretive Provisions. (a) The meanings of defined terms
are equally applicable to the singular and plural forms of the defined terms.
The words "hereof," "herein," "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
The term "including" is not limiting and means "including
without limitation."
In the computation of periods of time from a specified date
to a later specified date, the word "from" means "from and including"; the
words "to" and "until" each mean "to but excluding", and the word "through"
means "to and including."
Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
Accounting Principles. (a) Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied.
References herein to "fiscal year" and "fiscal quarter" refer
to such fiscal periods of the Company.
THE CREDITS
Amounts and Terms of Commitments Each Bank severally agrees, on the terms
and conditions set forth herein, to make Loans to the Company from time to time
on any Business Day during the period from the Closing Date to the Revolving
Termination Date, in an aggregate amount not to exceed at any time outstanding
the amount set forth on Schedule 2.01 (such amount, as the same may be reduced
under Section 2.05 or as a result of one or more assignments under
Section 10.08, the Bank's "Commitment"); provided, however, that, after giving
effect to any Borrowing, the aggregate principal amount of all outstanding Loans
shall not at any time exceed the combined Commitments. Within the limits of
each Bank's Commitment, and subject to the other terms and conditions hereof,
the Company may borrow under this Section 2.01, prepay under Section 2.06 and
reborrow under this Section 2.01.
Loan Accounts (a) The Loans made by each Bank shall be evidenced by one
or more loan accounts or records maintained by such Bank in the ordinary course
of business. The loan accounts or records maintained by the Agent and each Bank
shall be conclusive absent manifest error of the amount of the Loans made by the
Banks to the Company and the interest and payments thereon. Any failure so to
record or any error in doing so shall not, however, limit or otherwise affect
the obligation of the Company hereunder to pay any amount owing with respect to
the Loans.
Upon the request of any Bank made through the Agent, the Loans
made by such Bank may be evidenced by one or more Notes, instead of or in
addition to loan accounts. Each such Bank shall endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it and
the amount of each payment of principal made by the Company with respect
thereto. Each such Bank is irrevocably authorized by the Company to endorse its
Note(s) and each Bank's record shall be conclusive absent manifest error;
provided, however, that the failure of a Bank to make, or an error in making, a
notation thereon with respect to any Loan shall not limit or otherwise affect
the obligations of the Company hereunder or under any such Note to such Bank.
Procedure for Borrowing. (a) Each Borrowing shall be made upon the
Company's irrevocable written (or irrevocable notice via telephone confirmed
immediately by a facsimile provided such notice is confirmed with an original
written notice sent by mail or courier) notice delivered to the Agent in the
form of a Notice of Borrowing (which notice must be received by the Agent prior
to 9:00 a.m. (San Francisco time) (i) three Business Days prior to the requested
Borrowing Date, in the case of Offshore Rate Loans; and (ii) on the Business Day
that is the requested Borrowing Date, in the case of Base Rate Loans,
specifying:
the amount of the Borrowing, which shall be in an
aggregate minimum amount of $1,000,000 or any multiple of $100,000
in excess thereof;
the requested Borrowing Date, which shall be a
Business Day;
the Type of Loans comprising the Borrowing; and
the duration of the Interest Period applicable to
such Loans included in such notice. If the Notice of Borrowing
fails to specify the duration of the Interest Period for any
Borrowing comprised of Offshore Rate Loans, such Interest Period
shall be three months.
provided, however, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
1:00 p.m. (San Francisco time) one Business Day before the Closing Date and such
Borrowing will consist of Base Rate Loans only.
The Agent will promptly notify each Bank of its receipt of any
Notice of Borrowing and of the amount of such Bank's Pro Rata Share of that
Borrowing.
Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by the Company in funds immediately available to the Agent. The
proceeds of all such Loans will then be made available to the Company by the
Agent at such office by crediting the account of the Company on the books of
BofA with the aggregate of the amounts made available to the Agent by the Banks
and in like funds as received by the Agent.
After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than eight different Interest Periods
in effect.
Conversion and Continuation Elections (a) The Company may, upon
irrevocable written notice (or irrevocable notice via telephone confirmed
immediately by a facsimile provided such notice is confirmed with an original
written notice sent by mail or courier) to the Agent in accordance with
subsection 2.04(b):
elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the case
of any other Type of Loans, to convert any such Loans (or any part thereof
in an amount not less than $1,000,000, or that is in an integral multiple
of $100,000 in excess thereof) into Loans of any other Type; or
elect, as of the last day of the applicable Interest Period,
to continue any Loans having Interest Periods expiring on such day (or any
part thereof in an amount not less than $1,000,000, or that is in an
integral multiple of $100,000 in excess thereof);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Company to continue such Loans as, and convert such Loans into, Offshore
Rate Loans shall terminate.
The Company shall deliver a Notice of Conversion/Continuation
to be received by the Agent not later than 9:00 a.m. (San Francisco time) at
least (i) three Business Days in advance of the Conversion/Continuation Date, if
the Loans are to be converted into or continued as Offshore Rate Loans; and
(ii) on the Business Day that is the Conversion/Continuation Date, if the Loans
are to be converted into Base Rate Loans, specifying:
the proposed Conversion/Continuation Date;
the aggregate amount of Loans to be converted or
continued;
the Type of Loans resulting from the proposed
conversion or continuation; and
other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Company has failed to select timely a new Interest
Period to be applicable to such Offshore Rate Loans, or, subject to Subsection
2.04(e) wherein the Majority Banks may direct otherwise, if any Default or Event
of Default then exists, the Company shall be deemed to have elected to convert
such Offshore Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by the
Company, the Agent will promptly notify each Bank of the details of any
automatic conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Loans with
respect to which the notice was given held by each Bank.
Unless the Majority Banks otherwise consent, during the
existence of a Default or Event of Default, the Company may not elect to have a
Loan converted into or continued as an Offshore Rate Loan.
After giving effect to any conversion or continuation of Loans,
unless the Agent shall otherwise consent, there may not be more than eight
different Interest Periods in effect.
Voluntary Termination or Reduction of Commitments. The Company may, upon
not less than five Business Days' prior notice to the Agent, terminate the
Commitments, or permanently reduce the Commitments by an aggregate minimum
amount of $5,000,000 or any multiple of $1,000,000 in excess thereof; unless,
after giving effect thereto and to any prepayments of Loans made on the
effective date thereof, the then-outstanding principal amount of the Loans would
exceed the amount of the combined Commitments then in effect. Once reduced in
accordance with this Section, the Commitments may not be increased. Any
reduction of the Commitments shall be applied to each Bank according to its Pro
Rata Share. All accrued commitment fees to, but not including the effective
date of any termination of Commitments, shall be paid on the effective date of
such termination.
Optional PrepaymentsSubject to Section 3.04, the Company may, at any
time or from time to time, upon not less than (a) three Business Days' (in the
case of Offshore Rate Loans) and (b) the same Business Day's (in the case of
Base Rate Loans) irrevocable notice to the Agent, ratably prepay Loans in whole
or in part, in minimum amounts of $1,000,000 or any multiple of $100,000 in
excess thereof. Such notice of prepayment shall specify the date and amount of
such prepayment and the Type(s) of Loans to be prepaid. The Agent will promptly
notify each Bank of its receipt of any such notice, and of such Bank's Pro Rata
Share of such prepayment. If such notice is given by the Company, the Company
shall make such prepayment and the payment amount specified in such notice shall
be due and payable on the date specified therein, together with accrued interest
to each such date on the amount prepaid and any amounts required pursuant to
Section 3.04.
RepaymentThe Company shall repay to the Banks on the Revolving Termination
Date the aggregate principal amount of Loans outstanding on such date.
Interest (a) Each Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per annum
equal to the Offshore Rate or the Base Rate, as the case may be (and subject to
the Company's right to convert to other Types of Loans under Section 2.04), plus
the Applicable Margin.
Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of
Loans under Section 2.06 for the portion of the Loans so prepaid and upon
payment (including prepayment) in full thereof and, during the existence of any
Event of Default, interest shall be paid on demand of the Agent at the request
or with the consent of the Majority Banks.
Notwithstanding subsection (a) of this Section, while any Event
of Default exists or after acceleration, the Company shall pay interest (after
as well as before entry of judgment thereon to the extent permitted by law) on
the principal amount of all outstanding Obligations, at a rate per annum which
is determined by adding 1.50% per annum to the Applicable Margin then in effect
for such Loans and, in the case of Obligations not subject to an Applicable
Margin, at a rate per annum equal to the Base Rate plus 1.50%; provided,
however, that, on and after the expiration of any Interest Period applicable to
any Offshore Rate Loan outstanding on the date of occurrence of such Event of
Default or acceleration, the principal amount of such Loan shall, during the
continuation of such Event of Default or after acceleration, bear interest at a
rate per annum equal to the Base Rate plus 1.50%.
Anything herein to the contrary notwithstanding, the
obligations of the Company to any Bank hereunder shall be subject to the
limitation that payments of interest shall not be required for any period for
which interest is computed hereunder, to the extent (but only to the extent)
that contracting for or receiving such payment by such Bank would be contrary to
the provisions of any law applicable to such Bank limiting the highest rate of
interest that may be lawfully contracted for, charged or received by such Bank,
and in such event the Company shall pay such Bank interest at the highest rate
permitted by applicable law.
Fees a) Arrangement, Agency Fees. The Company shall pay an
arrangement fee to the Arranger for the Arranger's own account, and shall pay an
agency fee to the Agent for the Agent's own account, as required by the letter
agreement ("Fee Letter") between the Company and the Arranger and Agent dated
December 13, 1995.
Commitment FeesThe Company shall pay to the Agent for the
account of each Bank a commitment fee on the average daily unused portion of
such Bank's Commitment, computed on a quarterly basis in arrears on the last
Business Day of each calendar quarter based upon the daily utilization for that
quarter as calculated by the Agent, equal to .125 percent per annum. Such
commitment fee shall accrue from the Closing Date to the Revolving Termination
Date and shall be due and payable quarterly in arrears on the last Business Day
of each calendar quarter commencing on March 31, 1996 through the Revolving
Termination Date, with the final payment to be made on the Revolving Termination
Date; provided that, in connection with any reduction or termination of
Commitments under Section 2.05, the accrued commitment fee calculated for the
period ending on such date shall also be paid on the date of such reduction or
termination, with the following quarterly payment being calculated on the basis
of the period from such reduction or termination date to such quarterly payment
date. The commitment fees provided in this subsection shall accrue at all times
after the above-mentioned commencement date, including at any time during which
one or more conditions in Article IV are not met.
Computation of Fees and Interest. (a) All computations of fees and
interest for Base Rate Loans when the Base Rate is determined by BofA's
"reference rate" shall be made on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed. All other computations of interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more interest being paid than if computed on the basis of a 365-day year).
Interest and fees shall accrue during each period during which interest or such
fees are computed from the first day thereof to the last day thereof.
Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Banks in the absence of manifest
error.
Payments by the Company (a) All payments to be made by the Company
shall be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Company shall be made to the
Agent for the account of the Banks at the Agent's Payment Office, and shall be
made in dollars and in immediately available funds, no later than 10:00 a.m.
(San Francisco time) on the date specified herein. The Agent will promptly
distribute to each Bank its Pro Rata Share (or other applicable share as
expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than 10:00 a.m. (San Francisco time) shall
be deemed to have been received on the following Business Day and any applicable
interest or fee shall continue to accrue.
Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the computation of interest
or fees, as the case may be.
Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Banks that the Company will not make
such payment in full as and when required, the Agent may assume that the Company
has made such payment in full to the Agent on such date in immediately available
funds and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Bank on such due date an amount equal to the
amount then due such Bank. If and to the extent the Company has not made such
payment in full to the Agent, each Bank shall repay to the Agent on demand such
amount distributed to such Bank, together with interest thereon at the Federal
Funds Rate for each day from the date such amount is distributed to such Bank
until the date repaid.
Payments by the Banks to the Agent (a) Unless the Agent receives
notice from a Bank on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at least by 9:30 a.m. (San Francisco time) on
the date of such Borrowing, that such Bank will not make available as and when
required hereunder to the Agent for the account of the Company the amount of
that Bank's Pro Rata Share of the Borrowing, the Agent may assume that each Bank
has made such amount available to the Agent in immediately available funds on
the Borrowing Date and the Agent may (but shall not be so required), in reliance
upon such assumption, make available to the Company on such date a corresponding
amount. If and to the extent any Bank shall not have made its full amount
available to the Agent in immediately available funds and the Agent in such
circumstances has made available to the Company such amount, that Bank shall on
the Business Day following such Borrowing Date make such amount available to the
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Agent submitted to any Bank with respect to amounts
owing under this subsection (a) shall be conclusive, absent manifest error. If
such amount is so made available, such payment to the Agent shall constitute
such Bank's Loan on the date of Borrowing for all purposes of this Agreement.
If such amount is not made available to the Agent on the Business Day following
the Borrowing Date, the Agent will notify the Company of such failure to fund
and, upon demand by the Agent, the Company shall pay such amount to the Agent
for the Agent's account, together with interest thereon for each day elapsed
since the date of such Borrowing, at a rate per annum equal to the interest rate
applicable at the time to the Loans comprising such Borrowing.
The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a Loan on
such Borrowing Date, but no Bank shall be responsible for the failure of any
other Bank to make the Loan to be made by such other Bank on any Borrowing Date.
Sharing of Payments, Etc If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder), such Bank shall immediately (a) notify the Agent of
such fact, and (b) purchase from the other Banks such participations in the
Loans made by them as shall be necessary to cause such purchasing Bank to share
the excess payment pro rata with each of them; provided, however, that if all or
any portion of such excess payment is thereafter recovered from the purchasing
Bank, such purchase shall to that extent be rescinded and each other Bank shall
repay to the purchasing Bank the purchase price paid therefor, together with an
amount equal to such paying Bank's ratable share (according to the proportion of
(i) the amount of such paying Bank's required repayment to (ii) the total amount
so recovered from the purchasing Bank) of any interest or other amount paid or
payable by the purchasing Bank in respect of the total amount so recovered. The
Company agrees that any Bank so purchasing a participation from another Bank
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to Section 10.10) with respect to
such participation as fully as if such Bank were the direct creditor of the
Company in the amount of such participation. The Agent will keep records (which
shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments.
Extension of Termination Date. Upon (a) the written request of the
Company, received by the Agent not sooner than ninety (90) days nor later than
sixty (60) days prior to the first anniversary of the Closing Date (and, if
extended, thereafter at any time during the third month prior to the then
current Revolving Termination Date), and (b) the written concurrence of all the
Banks (in the sole discretion of each Bank) which is received by the Agent not
later than thirty (30) days prior to the then current Revolving Termination
Date, the Revolving Termination Date shall be extended for an additional one-
year period commencing on the then current Revolving Termination Date. In the
event such written concurrence from each and every one of the Banks is not
received by the Agent on or before thirty (30) days prior to the then current
Revolving Termination Date (after receipt by the Agent of such request from the
Company), the Revolving Termination Date shall not be extended. The Agent will
promptly notify each Bank of the receipt by it of a request under this
subsection.
TAXES, YIELD PROTECTION AND ILLEGALITY
Taxes (a) Subject to subsection 3.01(g), any and all payments by the
Company to each Bank or the Agent under this Agreement shall be made free and
clear of, and without deduction or withholding for, any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Bank and the
Agent, such taxes (including income taxes or franchise taxes including any
interest or penalties thereon) as are imposed on or measured by each Bank's net
income by any jurisdiction (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes").
In addition, the Company shall pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
other Loan Documents (hereinafter referred to as "Other Taxes").
Subject to subsection 3.01(g), the Company shall indemnify and
hold harmless each Bank and the Agent for the full amount of Taxes or Other
Taxes (including, without limitation, any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 3.01) paid by the Bank or the
Agent and any liability (including penalties, interest, additions to tax and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days from the date the Bank or the Agent
makes written demand therefor.
If the Company shall be required by law to deduct or withhold
any Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Bank or the Agent, then, subject to subsection 3.01(g):
the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable
to additional sums payable under this Section 3.01) and giving effect
to the tax benefits such Bank or the Agent of such deduction or
withholding (to the extent such benefits are reasonably determined
without undue effort by the Agent or such Bank) such Bank or the
Agent, as the case may be, receives an amount equal to the sum it
would have received had no such deductions been made;
the Company shall make such deductions, and
the Company shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with
applicable law.
Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes, the Company shall furnish to the Agent the original or a
certified copy of a receipt evidencing payment thereof, or other evidence of
payment satisfactory to the Agent.
Each Bank which is a foreign Person (i.e., a Person other than
a United States Person for United States federal income tax purposes) agrees
that:
it shall, no later than the Closing Date (or, in the
case of a Bank which becomes a party hereto pursuant to Section 10.08
after the Closing Date, the date upon which the Bank becomes a party
hereto), deliver to the Company through the Agent two accurate and
complete signed originals of Internal Revenue Service Form 4224 or any
successor thereto ("Form 4224"), or two accurate and complete signed
originals of Internal Revenue Service Form 1001 or any successor
thereto ("Form 1001"), as appropriate, in each case indicating that
the Bank is on the date of delivery thereof entitled to receive
payments of principal, interest and fees under this Agreement free
from withholding of United States federal income tax;
if at any time the Bank makes any changes necessitating
a new form, it shall with reasonable promptness deliver to the Company
through the Agent in replacement for, or in addition to, the forms
previously delivered by it hereunder, two accurate and complete signed
originals of Form 4224, or two accurate and complete signed originals
of Form 1001, as appropriate, in each case indicating that the Bank is
on the date of delivery thereof entitled to receive payments of
principal, interest and fees under this Agreement free from
withholding of United States federal income tax;
it shall, before or promptly after the occurrence of any
event (including the passing of time but excluding any event mentioned
in (ii) above) requiring a change in the most recent Form 4224 or Form
1001 previously delivered by such Bank and if the delivery of the same
be lawful, deliver to the Company through the Agent two accurate and
complete original signed copies of Form 4224 or Form 1001 in
replacement for the forms previously delivered by the Bank; and
it shall, promptly upon the Company's reasonable request
to that effect, deliver to the Company such other forms or similar
documentation as may be required from time to time by any applicable
law, treaty, rule or regulation in order to establish such Bank's tax
status for withholding purposes.
The Company will not be required to pay any additional amounts
in respect of United States federal income tax pursuant to subsection 3.01(d) to
any Bank for the account of any Lending Office of such Bank:
if the obligation to pay such additional amounts would
not have arisen but for a failure by such Bank to comply with its
obligations under subsection 3.01(f) in respect of such Lending
Office;
if such Bank shall have delivered to the Company a Form
4224 in respect of such Lending Office pursuant to subsection
3.01(f)(i), and such Bank shall not at any time be entitled to
exemption from deduction or withholding of United States federal
income tax in respect of payments by the Company hereunder for the
account of such Lending Office for any reason other than a change in
United States law or regulations or in the official interpretation of
such law or regulations by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the
force of law) after the date of delivery of such Form 4224; or
if the Bank shall have delivered to the Company a Form
1001 in respect of such Lending Office pursuant to subsection
3.01(f)(i), and such Bank shall not at any time be entitled to
exemption from deduction or withholding of United States federal
income tax in respect of payments by the Company hereunder for the
account of such Lending Office for any reason other than a change in
United States law or regulations or any applicable tax treaty or
regulations or in the official interpretation of any such law, treaty
or regulations by any Governmental Authority charged with the
interpretation or administration thereof (whether or not having the
force of law) after the date of delivery of such Form 1001.
If the Company is required to pay additional amounts to any
Bank or the Agent pursuant to subsection 3.01(d), then such Bank shall use its
reasonable best efforts (consistent with legal and regulatory restrictions) to
change the jurisdiction of its Lending Office so as to eliminate any such addi
tional payment by the Company which may thereafter accrue if such change in the
judgment of such Bank is not otherwise disadvantageous to such Bank.
The agreements and obligations of the Company contained in this
Section 3.01 shall survive the payment in full of all other Obligations.
Illegality (a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Bank or its applicable Lending Office to make
Offshore Rate Loans, then, on notice thereof by the Bank to the Company through
the Agent, any obligation of that Bank to make Offshore Rate Loans shall be
suspended until the Bank notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
If a Bank determines that it is unlawful to maintain any
Offshore Rate Loan, the Company shall, upon its receipt of notice of such fact
and demand from such Bank (with a copy to the Agent), prepay in full such
Offshore Rate Loans of that Bank then outstanding, together with interest
accrued thereon and amounts required under Section 3.04, either on the last day
of the Interest Period thereof, if the Bank may lawfully continue to maintain
such Offshore Rate Loans to such day, or immediately, if the Bank may not
lawfully continue to maintain such Offshore Rate Loan. If the Company is
required to so prepay any Offshore Rate Loan, then concurrently with such
prepayment, the Company shall borrow from the affected Bank, in the amount of
such repayment, a Base Rate Loan.
If the obligation of any Bank to make or maintain Offshore Rate
Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Bank through the Agent that all Loans which would otherwise be
made by the Bank as Offshore Rate Loans shall be instead Base Rate Loans.
Before giving any notice to the Agent under this Section, the
affected Bank shall designate a different Lending Office with respect to its
Offshore Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of the Bank, be
illegal or otherwise disadvantageous to the Bank.
Increased Costs and Reduction of (a) If any Bank determines that, due to
either (i) the introduction of or any change (other than any change by way of
imposition of or increase in reserve requirements included in the calculation of
the Offshore Rate or in respect of the assessment rate payable by any Bank to
the FDIC for insuring U.S. deposits) in or in the interpretation of any law or
regulation or (ii) the compliance by that Bank with any guideline or request
from any central bank or other Governmental Authority (whether or not having the
force of law), there shall be any increase in the cost to such Bank of agreeing
to make or making, funding or maintaining any Offshore Rate Loans, then the
Company shall be liable for, and shall from time to time, upon demand (with a
copy of such demand to be sent to the Agent), pay to the Agent for the account
of such Bank, additional amounts as are sufficient to compensate such Bank for
such increased costs.
If any Bank shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
the Bank (or its Lending Office) or any corporation controlling the Bank with
any Capital Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by the Bank or any corporation controlling
the Bank and (taking into consideration such Bank's or such corporation's
policies with respect to capital adequacy and such Bank's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitment, loans, credits or obligations under this
Agreement, then, upon written demand of such Bank to the Company through the
Agent, the Company shall pay to the Bank, from time to time as specified by the
Bank, additional amounts sufficient to compensate the Bank for such increase.
Any such Bank shall notify the Company in writing of its intent to demand such
compensation under this Section 3.03.
Funding LossesThe Company agrees to reimburse each Bank and to hold each
Bank harmless from any loss or expense which the Bank may sustain or incur as
follows:
upon the failure of the Company to borrow (including for
purposes of continuing or converting) any Offshore Rate Loan after the Company
has given a Notice of Borrowing with respect to Loans for any reason (including
the occurrence of a Default or an Event of Default), the Company shall, on
demand by each Bank, pay such Bank the amount (if any) by which (i) the interest
which would have been payable on such Bank's Pro Rata Share of the amount the
Company failed to borrow had such Bank's Pro Rata Share of such amount been
borrowed and outstanding for the Interest Period specified in the request for
such Borrowing exceeds (ii) the interest which would have been recoverable by
such Bank by placing such unborrowed amount on deposit in the LIBOR markets for
the Interest Period specified in the request for such Borrowing;
upon the failure of the Company to make any prepayment of a
Loan after the Company has given notice in accordance with Section 2.06 for any
reason, the Company agrees to reimburse each such Bank on demand for any loss,
cost or expense which such Bank may sustain or incur, including any such loss,
cost or expense arising from the liquidation or reemployment of funds obtained
by it to maintain its Offshore Rate Loans hereunder or from fees payable to
terminate the deposits from which such funds were obtained;
upon the conversion of an Offshore Rate Loan or the prepayment
of an Offshore Rate Loan in each case on a day which is not the last day of the
Interest Period with respect thereto for any reason (including conversions
pursuant to subsection 3.02(b)), the Company shall, on demand by such Bank, pay
such Bank the amount (if any) by which (i) the additional interest which would
have been payable on the amount so received had it not been received until the
last day of such Interest Period exceeds (ii) the interest which would have been
recoverable by such Bank by placing the amount so received on deposit in the
LIBOR markets for a period starting on the date on which it was so received and
ending on the last day of such Interest Period.
This covenant shall survive the payment in full of all other
Obligations.
Inability to Determine Rates If the Majority Banks determine that for any
reason adequate and reasonable means do not exist for determining the Offshore
Rate for any requested Interest Period with respect to a proposed Offshore Rate
Loan, or that the Offshore Rate applicable pursuant to subsection 2.08(a) for
any requested Interest Period with respect to a proposed Offshore Rate Loan does
not adequately and fairly reflect the cost to the Banks of funding such Loan,
the Agent will promptly so notify the Company and each Bank. Thereafter, the
obligation of the Banks to make or maintain Offshore Rate Loans, as the case may
be, hereunder shall be suspended until the Agent, upon the instruction of the
Majority Banks, revokes such notice in writing. Upon receipt of such notice,
the Company may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Company does not revoke
such Notice, the Banks shall make, convert or continue the Loans, as proposed by
the Company, in the amount specified in the applicable notice submitted by the
Company, but such Loans shall be made, converted or continued as Base Rate Loans
instead of Offshore Rate Loans.
Invoices of BanksAny Bank claiming reimbursement or compensation under this
Article III shall deliver to the Company (with a copy to the Agent) a written
invoice of all such amounts as may be due together with a reasonably detailed
calculation and explanation of the amount payable to the Bank hereunder, which
amount shall be paid by the Company within 30 days of the date of invoice
provided, however, that the Company shall have no liability for any amounts
attributable to a period more than three months prior to invoice date in respect
thereof.
SurvivalThe agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
Replacement Bank (a) If any Bank demands compensation under
Section 3.01, 3.02 or 3.03, the Company may, subject to the provisions of
subsections (b) and (c) of this Section 3.08, remove such Bank ("Removed Bank")
and designate another bank acceptable to the Agent, or, if BofA is the Removed
Bank, acceptable to the Banks ("Replacement Bank"), to purchase the Removed
Bank's share of the Credit, and to assume all of the Removed Bank's obligations
under this Agreement.
Each substitution under subsection 3.08(a) shall be made upon
the irrevocable written notice of the Company received by Agent and Removed Bank
at least ten days prior to the date thereof (a "Notice of Substitution"). The
Notice of Substitution shall identify the Removed Bank, the Replacement Bank and
the effective date of the substitution.
The substitution specified in each Notice of Substitution shall
take effect as of the date specified in such Notice of Substitution subject to
the conditions precedent that the following are complied with or exist on and as
of such date:
No Loan is to be made on the effective date of the
substitution and there is no pending request for a Loan;
The Replacement Bank has purchased all of Removed Bank's
share of the Credit and interest in this Agreement for a price equal
to all principal, interest and commitment fees outstanding on such
Removed Bank's share of the Credit on and as of the effective date of
the substitution;
The Replacement Bank has assumed by an agreement in form
and substance satisfactory to Removed Bank and Agent, or, if BofA is
the Removed Bank in form and substance satisfactory to the Banks, all
of Removed Bank's commitment to extend credit and other obligations
under this Agreement; and
There exists no Default or Event of Default.
CONDITIONS PRECEDENT
Conditions of Initial Loans. The obligation of each Bank to make
its initial Loan hereunder is subject to the condition that the Agent shall have
received on or before the Closing Date all of the following, in form and
substance satisfactory to the Agent and its counsel (the existence of which
satisfaction will be confirmed to the Company by delivery of a Certificate of
the Agent in the form of Exhibit J), and in sufficient copies for each Bank:
Credit Agreement and Notes. This Agreement and the Notes
executed by each party thereto;
Resolutions; Incumbency.
Copies of the resolutions of the board of directors of
(A) the Company authorizing the transactions contemplated hereby and
(B) the Guarantor authorizing the transactions contemplated by the
Guaranty, each certified as of the Closing Date by the Secretary or an
Assistant Secretary or other duly authorized officer of such Person; and
A certificate of the Secretary or Assistant Secretary or
other duly authorized officer of each of the Company and the Guarantor
certifying the names and true signatures of the officers of the Company and
the Guarantor, respectively, authorized to execute, deliver and perform, as
applicable, this Agreement, and all other Loan Documents to be delivered by
it, respectively, hereunder;
Organization Documents; Good Standing. Each of the following
documents:
the certificate of incorporation and the bylaws of the
Company as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary of the Company as of the Closing Date; and
a good standing certificate for the Company from the
Secretary of State (or similar, applicable Governmental Authority) of its
state of incorporation and each state where the Company is qualified to do
business as a foreign corporation as of a recent date;
Legal Opinions
an opinion of Stradling, Yocca, Xxxxxxx & Xxxxx, California
counsel to the Company and addressed to the Agent and the Banks,
substantially in the form of Exhibit D;
an opinion of Xxxxxx, Xxxx & Xxxxxxxx, California counsel to
the Guarantor and addressed to the Agent and the Banks, substantially in
the form of Exhibit E;
an opinion of Shin & Xxx, Korea counsel to the Guarantor and
addressed to the Agent and the Banks, substantially in the form of Exhibit
F;
Payment of FeesEvidence of payment by the Company of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with Attorney Costs of BofA to the extent invoiced
prior to the Closing Date; including any such costs, fees and expenses arising
under or referenced in Sections 2.09 and 10.04;
CertificateA certificate signed by a Responsible Officer, dated
as of the Closing Date, stating that:
the representations and warranties contained in Article V are
true and correct on and as of such date, as though made on and as of such
date;
no Default or Event of Default exists or would result from
the initial Borrowing; and
there has occurred since September 30, 1995, no event or
circumstance that has resulted or could reasonably be expected to result in
a Material Adverse Effect other than as previously disclosed in writing to
the Agent and the Banks;
GuarantyThe Guaranty executed and delivered by the Guarantor;
ConsentsCopies of all consents of any Governmental Authority
required in connection with the Loan Documents; and
Other DocumentsSuch other approvals, opinions, documents or
materials as the Agent or any Bank may request.
Conditions to All Borrowings. The obligation of each Bank to make
any Loan to be made by it is subject to the satisfaction of the following
conditions precedent on the relevant Borrowing Date:
Notice of Borrowing. The Agent shall have received a Notice of
Borrowing;
Continuation of Representations and WarrantiesThe
representations and warranties in Article V shall be true and correct on and as
of such Borrowing Date with the same effect as if made on and as of such
Borrowing Date (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they shall be true and correct
as of such earlier date); and
No Existing DefaultNo Default or Event of Default shall exist
or shall result from such Borrowing.
Each Notice of Borrowing submitted by the Company hereunder shall constitute a
representation and warranty by the Company hereunder, as of the date of each
such notice and as of each Borrowing Date, that the conditions in this
Section 4.02 are satisfied.
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Bank that:
Corporate Existence and PowerThe Company and each of its Material
Subsidiaries:
is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver and perform its obligations under the Loan Documents;
is duly qualified as a foreign corporation, licensed and in
good standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
except where the failure to so qualify would not have a Material Adverse Effect;
and
is in compliance in all material respects with all Requirements
of Law of any Governmental Authority having jurisdiction over it and its
business (including the Federal Fair Labor Standards Act), except such as may be
contested in good faith, as to which a bona fide dispute may exist or which
could not reasonably be expected to have a Material Adverse Effect.
Corporate Authorization; No ContraventionThe execution and delivery
of, and receipt of Loans and payment thereof and thereon and of other fees and
expenses as provided for in, this Agreement and any other Loan Document to which
the Company is party have been duly authorized by all necessary corporate action
and do not and will not:
contravene the terms of the Company's certificate of
incorporation, bylaws or other organizational document;
conflict with or result in any breach or contravention of, or
the creation of any Lien under, any indenture, agreement, lease, instrument,
Contractual Obligation, injunction, order, decree or undertaking to which the
Company is a party; or
violate any Requirement of Law.
Governmental AuthorizationNo approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental Authority is
necessary or required in connection with the execution, delivery, performance or
enforcement against the Company of this Agreement or any other Loan Document or
any other instrument or agreement required hereunder to be made by the Company.
Binding EffectThis Agreement and each other Loan Document to which
the Company or any of its Subsidiaries is a party constitute the legal, valid
and binding obligations of the Company, enforceable against such Person in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency or similar laws affecting the enforcement
of creditors' rights generally or by equitable principles relating to
enforceability.
Litigation
Except as specifically set forth in Schedule 5.05 hereto, there
are no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of any Responsible Officer or the general counsel of the Company or
any person holding a similar position within the Company, threatened or
contemplated at law, in equity, in arbitration or before any Governmental
Authority, against the Company, or its Subsidiaries or any of their respective
properties which: (i) purport to affect or pertain to this Agreement, or any
Loan Document, or any of the transactions contemplated hereby or thereby; or
(ii) if determined adversely to the Company, or its Subsidiaries, could
reasonably be expected to have a Material Adverse Effect.
No injunction, writ, temporary restraining order or any order
of any nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution, delivery and performance of this
Agreement or any other Loan Document, or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.
No DefaultNo Default or Event of Default exists or would result from the
incurring of obligations by the Company under this Agreement or any other Loan
Document. Neither the Company, nor any of its Subsidiaries, is in default under
or with respect to any Contractual Obligation in any respect which, individually
or together with all such defaults, would have a Material Adverse Effect.
ERISA Compliance
Schedule 5.07 lists all Plans and separately identifies Plans
intended to be Qualified Plans and Multiemployer Plans.
Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law,
including all requirements under the Code or ERISA for filing reports (which are
true and correct in all material respects as of the date filed), and benefits
have been paid in accordance with the provisions of the Plan except where
failure to comply would not have a Material Adverse Effect.
With respect to each Plan intended to qualify under the Code,
the Company or a member of its Controlled Group has applied to the Internal
Revenue Service for an advance determination letter to the effect that such Plan
and related trust are so qualified and, to the best knowledge of the Company, no
circumstances exist that would adversely affect the issuance of such letter or
such qualification (other than changes required to be made pursuant to the Tax
Reform Act of 1986 and subsequent laws and regulations, which will be made
within the applicable remedial amendment period under section 401(b) of the
Code).
Except as set forth on Schedule 5.07, no Plan subject to Title
IV of ERISA has any Unfunded Pension Liability.
Except as set forth in Schedule 5.07, no member of the
Controlled Group has ever represented, promised or contracted (whether in oral
or written form) to any current or former employee (either individually or to
employees as a group) that such current or former employee(s) would be provided,
at any cost to any member of the Controlled Group, with life insurance or
employee welfare plan benefits (within the meaning of Section 3(1) of ERISA)
following retirement or termination of employment. To the extent that any
member of the Controlled Group has made any such representation, promise or
contract, such member has expressly reserved the right to amend or terminate
such life insurance or employee welfare plan benefits with respect to claims not
yet incurred.
Members of the Controlled Group have complied in all material
respects with the notice and continuation coverage requirements of Section 4980B
of the Code.
Except as set forth in Schedule 5.07, no ERISA Event has
occurred or is reasonably expected to occur with respect to any Plan.
There are no pending or, to the best knowledge of the Company,
threatened claims, actions or lawsuits, other than routine claims for benefits
in the usual and ordinary course and claims that are not reasonably likely to
have a Material Adverse Effect, asserted or instituted against (i) any Plan
maintained or sponsored by the Company or its assets, (ii) any member of the
Controlled Group with respect to any Qualified Plan, or (iii) any fiduciary with
respect to any Plan for which the Company may be directly or indirectly liable,
through indemnification obligations or otherwise.
Except as set forth in Schedule 5.07, neither the Company nor
any ERISA Affiliate has incurred nor reasonably expects to incur (i) any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Section 4201 or
4243 of ERISA with respect to a Multiemployer Plan or (ii) any liability under
Title IV of ERISA (other than premiums due and not delinquent under Section 4007
of ERISA) with respect to a Plan.
Except as set forth in Schedule 5.07, neither the Company nor
any ERISA Affiliate has transferred any Unfunded Pension Liability outside of
the Controlled Group or otherwise engaged in a transaction that could be subject
to Section 4069 or 4212(c) of ERISA.
No member of the Controlled Group has engaged, directly or
indirectly, in a non-exempt prohibited transaction (as defined in Section 4975
of the Code or Section 406 of ERISA) in connection with any Plan which has a
reasonable likelihood of having a Material Adverse Effect.
Use of Proceeds; Margin RegulationsThe proceeds of the Loans are to be used
solely for the purposes set forth in and permitted by Section 6.12 and
Section 7.08. Neither the Company nor any Subsidiary is generally engaged in
the business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
Title to PropertiesThe Company and each of its Subsidiaries has good record
and marketable title in all their real property, except for Permitted Liens and
such defects in title as could not, individually or in the aggregate, have a
Material Adverse Effect.
Taxes. The Company and its Subsidiaries have filed all federal and
other material tax returns and reports required to be filed and have paid all
federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets other
wise due and payable except those which are being contested in good faith by
appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP and no Notice of Lien has been filed or recorded. There is
no proposed tax assessment against the Company or any of its Subsidiaries which
would, if the assessment were made, have a Material Adverse Effect.
Financial Condition; No Material Adverse Change
The unaudited consolidated financial statements of financial
condition of the Company and its Subsidiaries dated September 30, 1995, and the
related consolidated statements of operations, shareholders' equity and cash
flows for the fiscal period ended on that date:
were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise
expressly noted therein;
are complete, accurate and fairly present the financial
condition of the Company and its Subsidiaries as of the date thereof
and results of operations for the period covered thereby, subject to
normal year-end audit adjustments; and
show all material indebtedness and other material
liabilities, direct or contingent, of the Company and its consolidated
Subsidiaries as of the date thereof (including material liabilities
for taxes and material commitments) all as required by GAAP for year-
end reporting in accordance with the Company's past practices.
Except as disclosed in writing to the Agent and the Banks prior
to the Closing Date, since September 30, 1995, there has occurred no event or
circumstance that has resulted or will result (assuming for this purpose that no
unanticipated mitigating circumstances will arise) in a material adverse change
with respect to any of (i) the operations, business, properties or condition
(financial or otherwise) of the Company and its Consolidated Subsidiaries taken
as a whole; (ii) the ability of the Company to perform its obligations under the
Loan Documents without default; or (iii) the legality, validity, binding effect
or enforceability of any Loan Document.
Environmental Matters. Except as specifically identified in
Schedule 5.12:
the operations of the Company and each of its Subsidiaries
comply in all respects with all Environmental Laws except such non-compliance
which would not result in liability in excess, in the aggregate, of 5% of the
Company's Tangible Net Worth;
the Company and each of its Subsidiaries have obtained all
licenses, permits, authorizations and registrations required under any
Environmental Law ("Environmental Permits") necessary for their operations, and
all such Environmental Permits are in good standing, and the Company and each of
its Subsidiaries are in compliance with all terms and conditions of such
Environmental Permits, except such Environmental Permits of which the failure to
obtain could not reasonably be expected to have a Material Adverse Effect; and
as of the Closing Date, neither the Company, nor any of its
Subsidiaries or any of their present property or operations is in violation of
any outstanding written order from or agreement with any Governmental Authority
or other Person which expressly mentions the Company or such Subsidiary, nor
subject to any judicial or docketed administrative proceeding, respecting any
Environmental Law, Environmental Claim or Hazardous Material. After the Closing
Date, other than violations or proceedings which could not reasonably be
expected to have a Material Adverse Effect, neither the Company, nor any of its
Subsidiaries or any of their present property or operations is in violation of
any outstanding written order from or agreement with any Governmental Authority
or other Person which expressly mentions the Company or such Subsidiary, nor
subject to any judicial or docketed administrative proceeding, respecting any
Environmental Law, Environmental Claim or Hazardous Material.
Regulated Entities. None of the Company, any Person controlling the
Company, or any Subsidiaries of the Company, (a) is an "Investment Company"
within the meaning of the Investment Company Act of 1940; or (b) is limited in
its ability to incur Indebtedness under the Public Utility Holding Company Act
of 1935, the federal Power Act, the Interstate Commerce Act, any state public
utilities code or any other federal or state statute or regulation.
No Burdensome RestrictionsNeither the Company, nor any of its
Subsidiaries is a party to or bound by any Contractual Obligation or subject to
any charter or corporate restriction or any Requirement of Law which would
probably be expected to have a Material Adverse Effect.
SolvencyThe Company is Solvent.
Error! Bookmark not defined. Copyrights, Patents, Trademarks and Licenses,
Etc. The Company or any of its Consolidated Subsidiaries owns or is licensed or
otherwise has the right to use all of the patents, trademarks, service marks,
trade names, copyrights, franchises, authorizations and other rights the absence
of which could not reasonably be expected to have a Material Adverse Effect on
the operation of their respective businesses. As of the Closing Date, except
where such infringement would not have a Material Adverse Effect, to the best
knowledge of the Company, no slogan or other advertising device, product,
process, method, substance, part or other material now employed, or now
contemplated to be employed by the Company or any of its Subsidiaries infringes
upon any rights owned by any other Person. Except as set forth on Schedule
5.05, as of the Closing Date, no claim or litigation regarding any of the
foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of the Company, proposed, which, in either case,
would be likely to result in a Material Adverse Effect.
SubsidiariesAs of the Closing Date, the Company has no Subsidiaries other
than those listed on Schedule 5.17(a) hereto, and has no equity investments in
any other corporation or entity that would constitute an Affiliate (other than
Subsidiaries listed on Schedule 5.17(a)) except as listed on Schedule 5.17(b)
hereto.
Full DisclosureNone of the representations or warranties made by the
Company or any of its Subsidiaries in the Loan Documents as of the date of such
representations and warranties, and none of the statements contained in each
Exhibit, Schedule, report, statement or certificate furnished by or on behalf of
the Company or any of its Subsidiaries in connection with the Loan Documents,
contains any untrue statement of a material fact or omits any material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they are made, not misleading.
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks
waive compliance in writing:
Financial StatementsThe Company shall deliver to the Agent, in form
and detail satisfactory to the Agent and the Majority Banks, with sufficient
copies for each Bank:
as soon as available, but not later than 90 days after the end
of each fiscal year, a copy of the audited consolidated balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Ernst & Young
LLP or another nationally-recognized independent public accounting firm
("Independent Auditor") which report shall state that such consolidated
financial statements present fairly the financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years. Such opinion shall not be qualified or limited because of a restricted
or limited examination by the Independent Auditor of any material portion of the
Company's or any Material Subsidiary's records; and
as soon as available, but not later than 50 days after the end
of each of the first three fiscal quarters of each fiscal year (commencing with
the fiscal quarter ended March 30, 1996), a copy of the unaudited consolidated
balance sheet of the Company and its Subsidiaries as of the end of such quarter
and the related consolidated statements of income, shareholders' equity and cash
flows for the period commencing on the first day and ending on the last day of
such quarter, and certified by a Responsible Officer as fairly presenting, in
accordance with GAAP (subject to ordinary, good faith year-end audit
adjustments), the financial position and the results of operations of the
Company and the Subsidiaries; provided, however, that such financial statements
need not include footnotes and certain other financial presentations customarily
presented only for audited year-end statements under GAAP.
Certificates; Other InformationThe Company shall furnish to the
Agent, with sufficient copies for each Bank:
within 90 days of the delivery of the financial statements
referred to in subsection 6.01(a), and within 50 days of the delivery of the
financial statements referred to in subsection 6.01(b), a Compliance Certificate
executed by a Responsible Officer;
promptly (and in any event no later than 5 days after filing
with the Securities and Exchange Commission), copies of all financial statements
and reports that the Company sends to or files with the Securities and Exchange
Commission; and
promptly, such additional information regarding the Company as
the Agent, at the request of any Bank, may from time to time reasonably request.
NoticesThe Company shall promptly notify the Agent and each Bank:
of the occurrence of any Default or Event of Default, and of
the occurrence or existence of any event or circumstance that, to the knowledge
of any Responsible Officer, will become a Default or Event of Default;
of any matter that has resulted or may be reasonably likely to
result in a Material Adverse Effect, including (i) breach or non-performance of,
or any default under, a Contractual Obligation of the Company or any Subsidiary;
(ii) any dispute, litigation, investigation, proceeding or suspension between
the Company or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting the Company or any Subsidiary; including pursuant to any applicable
Environmental Laws;
of the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event more than 10 days after such
event), and deliver to the Agent and each Bank a copy of any notice with respect
to such event that is filed with a Governmental Authority and any notice
delivered by a Governmental Authority to the Company or any ERISA Affiliate with
respect to such event:
an ERISA Event;
a material increase in the Unfunded Pension Liability of any
Pension Plan;
the adoption of, or the commencement of contributions to, any
Plan subject to Section 412 of the Code by the Company or any ERISA
Affiliate; or
the adoption of any amendment to a Plan subject to
Section 412 of the Code, if such amendment results in a material increase
in contributions or Unfunded Pension Liability; or
of any material change in accounting policies or financial
reporting practices by the Company or any of its Consolidated Subsidiaries.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary proposes to take with respect thereto and at what time. Each notice
under subsection 6.03(a) shall describe with particularity any and all clauses
or provisions of this Agreement or other Loan Document that have been (or
foreseeably will be) breached or violated.
Preservation of Corporate Existence, Etc. The Company shall and
(with respect to clauses (a), (b) and (c)) shall cause each of its Material
Subsidiaries to:
with respect to the Company, preserve and maintain in full
force and effect its corporate existence and good standing under the laws of its
state or jurisdiction of incorporation and, with respect to the Material
Subsidiaries, preserve and maintain in full force and effect the corporate
existence and good standing under the laws of each state or jurisdiction of
incorporation except where failure to take such actions could not reasonably be
expected to have a Material Adverse Effect;
preserve and maintain in full force and effect all rights,
privileges, qualifications, permits, licenses and franchises necessary or
desirable in the normal conduct of its business except in connection with
(i) dispositions of assets permitted by Section 7.02, (ii) transactions
permitted by Section 7.03, and (iii) dissolution or abandonment of any
Subsidiary in compliance with either Section 7.02 or 7.03, and the failure to
maintain such rights, privileges, qualifications, permits, licenses and
franchises would not have a Material Adverse Effect; provided, however, nothing
set forth herein shall limit the application of Section 7.02 or 7.03;
preserve or renew all of its registered trademarks, trade names
and service marks, the non-preservation of which could have a Material Adverse
Effect; and
use its reasonable efforts, in the ordinary course, to preserve
its business and the goodwill of its business.
Maintenance of PropertyThe Company shall maintain, and shall cause
each Subsidiary to maintain, and preserve all its property which is used or
useful in its business in good working order and condition, ordinary wear and
tear excepted, except as permitted by Section 7.02. The Company and each
Subsidiary shall use the standard of care typical in the industry in the
operation and maintenance of its facilities.
InsuranceThe Company shall maintain, and shall cause each Subsidiary
to maintain, with financially sound and reputable insurers, insurance with
respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons; provided, however, the Company and its
Subsidiaries may, with the prior consent of the Majority Banks (which consent
may be withheld in their reasonable credit judgment in light of prevailing
credit standards), substitute for or augment any insurance with self-insurance;
provided, further, that such self-insurance is adequate in view of the risks and
financial condition of the Company and its Subsidiaries at such time and is in
accordance with customary industry standards; and provided, further, that, for
the purposes of this Section 6.06, the self-insurance programs of the Company
for employee medical insurance and disability insurance in effect as of the
Closing Date are approved.
Payment of ObligationsThe Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
all material tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same are being
contested in good faith by appropriate proceedings and adequate reserves in
accordance with GAAP are being maintained by the Company or such Subsidiary;
all lawful claims which, if unpaid, would by law become a Lien
upon its property, other than Permitted Liens; and
all Indebtedness, as and when due and payable, but subject to
any subordination provisions contained in any instrument or agreement evidencing
such Indebtedness, except (i) where the amount or validity thereof is being
contested in good faith by appropriate proceedings or as to which a bona fide
dispute may exist and provision has been made in conformity with GAAP with
respect thereto, or (ii) to the extent the failure to pay is due to a good faith
error omission and will not in any event have a Material Adverse Effect.
Compliance with Laws. The Company shall comply, and shall cause each
Subsidiary to comply, in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
Compliance with ERISA. The Company shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; and (c) make all required contributions to
any Plan subject to Section 412 of the Code.
Inspection of Property and Books and Records. The Company shall
maintain and shall cause each Subsidiary to maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall permit representatives and independent contractors of the Agent or
any Bank to visit and inspect any of their respective properties, to examine
their respective corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants, at such reasonable times during normal business hours and as
often as may be reasonably desired, upon reasonable advance notice to the
Company; provided, however, when an Event of Default exists the Agent or any
Bank may do any of the foregoing at the expense of the Company at any time
during normal business hours and without advance notice.
Environmental LawsThe Company shall, and shall cause each Subsidiary
to, conduct its operations and keep and maintain its property in compliance with
all Environmental Laws.
Use of Proceeds. The Company shall use the proceeds of the Loans for
working capital not in contravention of any Requirement of Law or of any Loan
Document.
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks
waive compliance in writing:
Limitation on LiensThe Company shall not, nor shall it permit any of
its Subsidiaries to, directly or indirectly, make, create, incur, assume or
suffer to exist any Lien upon or with respect to any part of its property or
assets, whether now owned or hereafter acquired, or agree to do so, other than
the following ("Permitted Liens"):
any Lien existing on the property of the Company on the Closing
Date as set forth in Schedule 7.01 securing Indebtedness outstanding on such
date;
any Lien created under any Loan Document;
Liens for taxes, fees, assessments or other governmental
charges which are not yet delinquent or remain payable without penalty, or to
the extent that non-payment thereof is permitted by Section 6.07, provided that
(i) no Notice of Lien has been filed or recorded in the United States of America
and (ii) no Notice of Lien has been filed or recorded in any other jurisdiction
except such Notices of Lien which would not have a Material Adverse Effect;
carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary course
of business which are not delinquent or remain payable without penalty or which
are being contested in good faith and by appropriate proceedings;
Liens (other than any Lien imposed by ERISA) on the property of
the Company or any of its Subsidiaries incurred, or pledges or deposits required
in connection with worker's compensation, unemployment insurance, other social
security legislation and Liens consisting of deposits placed with insurance
companies for health insurance created in the ordinary course of business;
Liens on the property of the Company or any of its Subsidiaries
securing (i) the performance of bids, trade contracts (other than for borrowed
money), leases, subleases, statutory obligations and regulatory or other
governmentally imposed obligations, and (ii) obligations on surety, appeal,
performance or similar bonds, and (iii) other obligations of a like nature
incurred in the ordinary course of business provided all such Liens in the
aggregate would not have a Material Adverse Effect;
easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the businesses of the Company and its Subsidiaries;
purchase money security interests on any real or personal
property acquired or held by the Company in the ordinary course of business,
securing Indebtedness incurred or assumed for the purpose of financing all or
any part of the cost of acquiring such property or Capital Lease Obligations;
provided that any such Lien attaches to such property concurrently with or
within 30 days after the acquisition or refinancing thereof;
Liens on property existing prior to the acquisition of such
property by the Company or its Subsidiaries and not created in anticipation of
such acquisition;
Extensions and renewals of any Lien described in
subsection 7.01(a), (b), (f), (h), (i) or (k);
Liens which constitute rights of set-off of a customary nature
or bankers' Liens with respect to amounts on deposit, whether arising by
operation of law or by contract, in connection with working capital facilities,
operational services, lines of credit, term loans, or other credit facilities
and similar arrangements entered into with banks in the ordinary course of
business;
Other Liens incidental to the conduct of the business of the
Company or any of its Subsidiaries or the ownership of their property which are
incurred in the ordinary course of business (and are not security for borrowed
money); provided such Liens do not exceed $10,000,000 in the aggregate; and
Liens arising in connection with any sale of accounts
receivable permitted under Section 7.02; provided, that the Lien does not extend
beyond the accounts receivable so sold or discounted except to the extent
reasonably required by any purchaser of such accounts receivable.
Disposition of AssetsThe Company shall not, nor shall it permit any
of its Subsidiaries to, directly or indirectly, sell, assign, lease, convey,
transfer or otherwise dispose of (whether in one or a series of transactions)
any of its material assets, business or property (including accounts and notes
receivable (with or without recourse) and equipment sale-leaseback
transactions), or enter into any agreement to do any of the foregoing, except:
dispositions of inventory, or used, worn-out or surplus
equipment, all in the ordinary course of business and other dispositions of
property (i) not necessary to the normal operations of the Company and its
Subsidiaries taken as a whole as contemplated by this Agreement and (ii) which
would not have a Material Adverse Effect;
the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement equipment
or the proceeds of such sale are promptly applied to the purchase price of such
replacement equipment;
dispositions in connection with Investments permitted under
Section 7.04, provided that full, fair and reasonable consideration is received
in return for any assets disposed of to acquire such Investments;
dispositions of any Investments, provided that fair and
reasonable consideration is received in connection therewith as reasonably
determined by the Company;
abandonments or dispositions for less than reasonably
equivalent value, resulting from any seizure, forfeiture or taking, or any
threatened or imminent seizure, forfeiture or taking, of licenses, franchises or
properties of Subsidiaries located outside of the United States, so long as all
such abandonments and other dispositions will not, in the aggregate, have a
Material Adverse Effect;
the sale or discounting of accounts receivable by the Company
or any Subsidiary, without restriction;
sale of trade-related instruments arising in foreign countries, in the
ordinary course of business, with or without recourse to the Company or any of
its Subsidiaries, to banks or other financial service institutions, for fair
value, provided that (i) the amount of any fees, discounts and other considera
tion received by such banks or other financial service institutions is normal
and customary, and (ii) such sales are customary business practices in the
country where such activity takes place;
the sale or discounting of accounts receivable through asset-
backed securitizations so long as fair market value is received for such
accounts and so long as there would be no Material Adverse Effect;
disposition of the Company's headquarters building located at
the address set forth in Section 10.02 in a sale-leaseback transaction so long
as the Company receives fair market value for its ownership interest in its
headquarters;
dispositions not otherwise permitted hereunder which are made
for fair market value; provided, that (i) at the time of any disposition, no
Event of Default shall exist or shall result from such disposition, (ii) the
aggregate sales price from such disposition shall be paid in cash, and (iii) the
aggregate value of all assets so sold by the Company and its Subsidiaries,
together, shall not exceed in any fiscal year 15% of Consolidated Total Assets;
and
such other dispositions as the Agent and the Majority Banks
shall agree to in their sole discretion.
Consolidations and MergersExcept as provided in Section 7.02, the Company
shall not, and shall not permit any of its Material Subsidiaries to, merge,
consolidate with or into, or convey, transfer, lease or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to any Person,
except:
any Subsidiary of the Company may merge, consolidate or combine
with or into, or transfer assets to the Company (provided that the Company shall
be the continuing or surviving corporation) or with any one or more Subsidiaries
of the Company (provided that if any transaction shall be between a Subsidiary
and a Material Subsidiary that is a Wholly-Owned Subsidiary, the Wholly-Owned
Subsidiary shall be the continuing or surviving corporation);
any Subsidiary of the Company may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to the Company or another Wholly-Owned Subsidiary of the Company if,
immediately after giving effect thereto, no Default or Event of Default would
exist; and
the Company or any of its Subsidiaries may enter into any
partnership or joint venture.
Loans and InvestmentsThe Company shall not, directly or indirectly,
purchase or acquire, or permit any of its Subsidiaries to purchase or acquire,
or make any commitment therefor, any capital stock, equity interest, assets,
obligations or other securities of or any interest in, any Person (including by
merger), or make any advance, loan, extension of credit or capital contribution
to or any other investment in, any Person including any Affiliate of the Company
("Investments"), except for:
Investments in Marketable Investments;
extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business and ordinary course rescheduling of such amounts in
connection with the collection thereof;
extensions of credit or capital contributions by the Company to
any of its Subsidiaries or by any of its Subsidiaries to another of its
Subsidiaries;
loans to officers or employees of the Company or any Subsidiary
of the Company to the extent permitted by applicable law, charter and by-law
provisions and which do not exceed in the aggregate amount outstanding at any
time for the Company and its Subsidiaries $5,000,000 and are not for the purpose
of an Acquisition;
Investments in connection with Acquisitions in the capital
stock, assets, obligations or other securities of or interest in other Persons,
provided, in each case, (i) the amount of consideration payable (including by
assumption of liabilities) by the Company or its Subsidiary, when added to
similar amounts for all transactions entered into after the Closing Date by the
Company or any of its Subsidiaries, does not exceed $50,000,000; and (ii) (x) if
any Acquiree is subject to Section 12 of the Exchange Act or subject to the
requirements of Section 15(d) of such Act, the prior, effective written consent
of the board of directors or equivalent governing body of the Acquiree is
obtained and delivered to the Agent, or (y) if the Acquiree does not meet the
qualifications set forth in clause (x) of this subclause (ii) of
subsection 7.04(e), the prior effective written consent of the board of
directors or equivalent governing body and the percent of any and all classes of
stock or other equity of such Acquiree the consent of which, notwithstanding any
provisions in the charter or by-laws of the Acquiree to the contrary, is
required by applicable statute to consummate the Acquisition, is obtained and
delivered to the Agent;
purchases or redemptions of debt obligations of the Company or
its Subsidiaries so long as no Default or Event of Default exists and is
continuing or would occur as a result thereof;
Investments for transactions permitted under subsection 7.03(c)
hereof; and
other Investments not described above and that are not pro
hibited elsewhere in this Agreement, to the extent such Investments do not
exceed $25,000,000 outstanding at any one time and are not used for the purpose
of an Acquisition.
Notwithstanding any provision in this Section 7.04 to the contrary, none of the
following shall constitute "Investments" for purposes of this Section 7.04:
Any distributions paid or made in respect of the stock of the
Company or any Subsidiary of the Company (whether in cash, property or
stock of the Company or any such Subsidiary), or
Any payments (whether in cash, property or stock of the
Company or any Subsidiary) to redeem, purchase or otherwise acquire any
stock of the Company or any Subsidiary of the Company;
provided, in each case, (A) that any such distribution or payment is otherwise
permitted under the terms of this Agreement, and (B) if any such distribution or
payment is changed from the form in which it was received, it must comply with
the provisions of this Section 7.04. For purposes of the preceding sentence,
the term "stock" shall include warrants, options and other rights to purchase
stock.
Transactions With Affiliates. Except as set forth on Schedule 7.05,
the Company shall not and shall not permit any of its Subsidiaries to enter into
any transaction with any Affiliate of the Company or of any such Subsidiary
except as contemplated by this Agreement or in the ordinary course of business
and pursuant to the reasonable requirements of the business of the Company or
such Subsidiary and upon fair and reasonable terms no less favorable to the
Company or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of the Company or such Subsidiary.
Compliance With ERISAExcept with the specific written consent of the
Majority Banks, which consent shall not unreasonably be withheld, the Company
shall not directly or indirectly and shall not permit any ERISA Affiliate
directly or indirectly (i) to terminate any Plan subject to Title IV of ERISA so
as to result in any material (in the opinion of the Majority Banks) liability to
the Company or any ERISA Affiliate, (ii) to permit to exist any ERISA Event or
any other event or condition which presents the risk of a material (in the
opinion of the Majority Banks) liability of the Company or any ERISA Affiliate,
or (iii) to make a complete or partial withdrawal (within the meaning of ERISA
section 4201) from any Multiemployer Plan so as to result in any material (in
the opinion of the Majority Banks) liability to the Company or any ERISA
Affiliate, (iv) to enter into any new Plan or modify any existing Plan so as to
increase its obligations thereunder (except in the ordinary course of business
consistent with past practice) which could result in any material (in the
opinion of the Majority Banks) liability to any member of the Controlled Group,
or (v) permit the present value of all nonforfeitable benefits (within the
meaning of ERISA section 4001(a)(8)) under each Plan (using the actuarial assump
tions utilized by the PBGC upon termination of a Plan) materially (in the
opinion of the Majority Banks) to exceed the fair market value of Plan assets
allocable to such benefits, all determined as of the most recent valuation date
for each such Plan.
Restricted Payments. The Company shall not declare or make any
dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any shares of any class of its capital
stock or purchase, redeem or otherwise acquire for value any shares of its
capital stock or any warrants, rights or options to acquire such shares, now or
hereafter outstanding; except that the Company and its Subsidiaries may:
declare and make dividend payments or other distributions
payable solely in its common stock;
purchase, redeem or otherwise acquire shares of its common
stock or warrants or options to acquire any such shares from employees
terminating employment with the Company, pursuant to the Company's customary
policies and procedures relating to such matters, up to a maximum aggregate
amount of $5,000,000 in any fiscal year of the Company; and
purchase or redeem debt obligations convertible into Common
Stock.
Use of Proceeds. The Company shall not, and shall not suffer or permit any
Subsidiary to, use any portion of the Loan proceeds, directly or indirectly, (i)
to purchase or carry Margin Stock, (ii) to repay or otherwise refinance
Indebtedness of the Company or others incurred to purchase or carry Margin
Stock, (iii) to extend credit for the purpose of purchasing or carrying any
Margin Stock, or (iv) to acquire any security in any transaction that is subject
to Section 13 or 14 of the Exchange Act.
Change in Business. The Company shall not, and shall not suffer or
permit any of its Material Subsidiaries to, engage in any material line of
business which accounts for a substantial portion of the business or assets of
the Company and its Subsidiaries as a whole which is substantially different
from those lines of business carried on by it on the date hereof; provided,
however, the specific activities listed on Schedule 7.09 hereto will not be
deemed to be substantially different; provided, further, no inference as to the
character of any other activities may be drawn from Schedule 7.09. The Company
and its Consolidated Subsidiaries shall not cease to be primarily engaged in the
manufacture or assembly of personal computers, and shall not voluntarily cease
to operate its business as a manufacturer or assembler of personal computers for
a significant period of time.
Accounting ChangesThe Company shall not make any significant or material
change in accounting treatment and reporting practices, except in accordance
with GAAP.
EVENTS OF DEFAULT
Event of Default. Any of the following shall constitute an "Event
of Default":
Non-PaymentThe Company fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan, or (ii) within 10 days
after the same becomes due, any interest, fee or any other amount payable
hereunder or under any other Loan Document; or
Representation or Warranty. Any representation or warranty by
the Company or any Subsidiary made or deemed made herein, in any other Loan
Document, or which is contained in any certificate, document or financial or
other statement by the Company, any Subsidiary, or any Responsible Officer,
furnished at any time under this Agreement, or in or under any other Loan
Document, is incorrect in any material respect on or as of the date made or
deemed made; or
Specific Defaults. The Company fails to perform or observe any
term, covenant or agreement contained in any of Section 6.03 or in Article VII
(except for Section 7.01 to the extent Liens are not Voluntary Liens and
Section 7.06); or
Other Defaults. The Company fails to perform or observe any
other term or covenant contained in this Agreement or any other Loan Document,
and such default shall continue unremedied for a period of 20 days after the
earlier of (i) the date upon which a Responsible Officer knew or reasonably
should have known of such failure or (ii) the date upon which written notice
thereof is given to the Company by the Agent or any Bank; or
Cross-DefaultThe Company or any of its Subsidiaries (i) fails
to make any payment in respect of any Indebtedness or Contingent Obligation,
having an aggregate principal amount (including unused commitments and
outstanding amounts) of more than $25,000,000, when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) and, in the
case of payments other than in respect of principal, such failure continues
without any Permitted Waiver for the duration of any grace period specified in
the applicable document as of the time such failure occurs; or (ii) fails to
perform or observe any other condition or covenant or any other event shall
occur or condition exist under any agreement or instrument relating to any such
Indebtedness or Contingent Obligation if same has an aggregate principal amount
more than $25,000,000, and such failure continues without any Permitted Waiver
for the duration of any grace period specified in the applicable document as of
the time such failure occurs, if the effect of such event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, such Indebtedness
to be declared to be due and payable prior to its stated maturity or such
Contingent Obligation to become payable (immediately or after expiration of any
grace period); or
Insolvency; Voluntary Proceedings. The Company or any Material
Subsidiary (i) ceases or fails to be Solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
Involuntary Proceedings (i) Any involuntary Insolvency Proceeding is
commenced or filed against the Company or any Subsidiary, or any writ, judgment,
warrant of attachment, execution or similar process, is issued or levied against
a substantial part of the Company's or any Material Subsidiary's properties, and
any such proceeding or petition shall not be dismissed, or such writ, judgment,
warrant of attachment, execution or similar process shall not be released,
vacated or fully bonded within 60 days after commencement, filing or levy; (ii)
the Company or any Material Subsidiary admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) the Company or any Material Subsidiary acquiesces in the appointment of a
receiver, trustee, custodian, conservator, liquidator, mortgagee in possession
(or agent therefor), or other similar Person for itself or a substantial portion
of its property or business; or
ERISA (i) An ERISA Event shall occur with respect to a Pension
Plan or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Company under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $25,000,000;
(ii) the aggregate amount of Unfunded Pension Liability among all Pension Plans
at any time exceeds $25,000,000; or (iii) the Company or any ERISA Affiliate
shall fail to pay when due, after the expiration of any applicable grace period,
any installment payment with respect to its withdrawal liability under
Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $25,000,000; or
Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Material Subsidiary involving in the aggregate a liability (to
the extent not covered by third-party insurance) as to any single or related
series of transactions, incidents or conditions, of 10% of Tangible Net Worth or
more, and the same shall remain unsatisfied, unvacated and unstayed pending
appeal for a period of 45 consecutive days after the entry thereof; or
Non-Monetary Judgments. Any non-monetary judgment, order or decree
is entered against the Company or any Subsidiary which does or would reasonably
be expected to have a Material Adverse Effect, and there shall be any period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
Change of Control. There occurs any Change of Control; or
Guarantor Defaults. The Guarantor fails in any material
respect to perform or observe any term, covenant or agreement in the Guaranty,
or the Guaranty is for any reason partially (including with respect to future
advances) or wholly revoked or invalidated, or otherwise ceases to be in full
force and effect, or the Guarantor or any other Person contests in any manner
the validity or enforceability thereof or denies that it has any further
liability or obligation thereunder, or any event described at subsections (f) or
(g) of this Section occurs with respect to the Guarantor, or the Guarantor fails
to promptly obtain the payment authorization of the Guarantor's designated
foreign exchange bank, which is currently Hanil Bank, required for payment under
the Guaranty, or the Guarantor fails to maintain the approval of such designated
foreign exchange bank that has approved the issuance, execution, delivery and
performance of the Guaranty by the Guarantor or to promptly (and in any event
within 15 days after a request for payment under the Guaranty) obtain the
approval of such designated foreign exchange bank to any assignment of, or
amendment to, the Guaranty.
Remedies. If any Event of Default occurs, the Agent shall, at the request
of, or may, with the consent of, the Majority Banks,
declare the Commitment of each Bank to make Loans to be
terminated, whereupon such Commitments shall be terminated;
declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Company; and
exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 8.01 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each Bank
to make Loans shall automatically terminate and the unpaid principal amount of
all outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable without further act of the Agent or any
Bank.
Rights Not ExclusiveThe rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
THE AGENT
Appointment and Authorization; "Agent. Each Bank hereby irrevocably
(subject to Section 9.09) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties or
responsibilities, except those expressly set tc forth herein, nor shall the
Agent have or be deemed to have any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent. Without limiting the generality of the
foregoing sentence, 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.
Delegation of Duties. The Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
Liability of Agent. None of the Agent-Related Persons shall (i) be liable
for any action taken or omitted to be taken in good faith by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Banks for any
recital, statement, representation or warranty made by the Company or any
Subsidiary or Affiliate of the Company, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan Document, or
the validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of the Company or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Agent-Related Person shall be under any obligation to any Bank
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Company or any
of the Company's Subsidiaries or Affiliates.
Reliance by Agent. (a) The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to the Company), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Banks as it deems appropriate
and, if it so requests, 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. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent of
the Majority Banks and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Banks.
For purposes of determining compliance with the conditions
specified in Section 4.01, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Bank.
Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Agent for the account of the Banks, unless the Agent shall have
received written notice from a Bank or the Company referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". The Agent will promptly notify the Banks of its receipt of
any such notice. The Agent shall take such action with respect to such Default
or Event of Default as may be requested by the Majority Banks in accordance with
Article VIII; provided, however, that unless and until the Agent has received
any such request, the Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Default or
Event of Default as it shall deem advisable or in the best interest of the
Banks.
Credit Decision. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Bank. Each Bank represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and credit worthiness of the
Guarantor, the Company and its Subsidiaries, and all applicable bank regulatory
laws relating to the transactions contemplated hereby, and made its own decision
to enter into this Agreement and to extend credit to the Company hereunder.
Each Bank also represents that it will, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and credit worthiness of the Company and the Guarantor.
Except for notices, reports and other documents expressly herein required to be
furnished to the Banks by the Agent, the Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or credit worthiness of the Company which may come into the possession
of any of the Agent-Related Persons.
Indemnification of Agent. The Banks shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from and against any and all Indemnified Liabilities; provided, however, that no
Bank shall be liable for the payment to the Agent-Related Persons of any portion
of such Indemnified Liabilities resulting solely from such Person's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Bank shall reimburse the Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Agent is not
reimbursed for such expenses by or on behalf of the Company. The undertaking in
this Section shall survive the payment of all Obligations hereunder and the
resignation or replacement of the Agent.
Agent in Individual Capacity. BofA and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BofA were not the Agent hereunder and
without notice to or consent of the Banks. The Banks acknowledge that, pursuant
to such activities, BofA or its Affiliates may receive information regarding the
Company or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Company or such Subsidiary) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, BofA shall have the same rights
and powers under this Agreement as any other Bank and may exercise the same as
though it were not the Agent, and the terms "Bank" and "Banks" include BofA in
its individual capacity.
Successor AgentThe Agent may, and at the request of the Majority
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Majority Banks shall appoint from among the
Banks a successor agent for the Banks. If no successor agent is appointed prior
to the effective date of the resignation of the Agent, the Agent may appoint,
after consulting with the Banks and the Company, a successor agent from among
the Banks. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Article IX and Sections 10.04 and 10.05 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Banks shall perform all of the duties of the Agent hereunder until such
time, if any, as the Majority Banks appoint a successor agent as provided for
above.
Withholding Tax (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Bank agrees with and in favor of the Agent, to deliver to
the Agent:
if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly completed
and executed copies of IRS Form 1001 before the payment of any interest in
the first calendar year and before the payment of any interest in each
third succeeding calendar year during which interest may be paid under this
Agreement;
if such Bank claims that interest paid under this Agreement
is exempt from United States withholding tax because it is effectively
connected with a United States trade or business of such Bank, two properly
completed and executed copies of IRS Form 4224 before the payment of any
interest is due in the first taxable year of such Bank and in each
succeeding taxable year of such Bank during which interest may be paid
under this Agreement; and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption from,
or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form 1001 and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of the Company to such Bank, such Bank agrees to notify the
Agent of the percentage amount in which it is no longer the beneficial owner of
Obligations of the Company to such Bank. To the extent of such percentage
amount, the Agent will treat such Bank's IRS Form 1001 as no longer valid.
If any Bank claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company to such Bank, such Bank agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.
If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Bank
an amount equivalent to the applicable withholding tax after taking into account
such reduction. However, if the forms or other documentation required by
subsection (a) of this Section are not delivered to the Agent, then the Agent
may withhold from any interest payment to such Bank not providing such forms or
other documentation an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction.
If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent did not properly
withhold tax from amounts paid to or for the account of any Bank (because the
appropriate form was not delivered or was not properly executed, or because such
Bank failed to notify the Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason) such Bank shall indemnify the Agent fully for all amounts paid, directly
or indirectly, by the Agent as tax or otherwise, including penalties and
interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Banks under this subsection
shall survive the payment of all Obligations and the resignation or replacement
of the Agent.
MISCELLANEOUS
Amendments and Waivers. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent with respect to any
departure by the Company therefrom, shall be effective unless the same shall be
in writing and signed by the Majority Banks (or by the Agent at the written
request of the Majority Banks) and the Company and acknowledged by the Agent,
and then any such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
no such waiver, amendment, or consent shall, unless in writing and signed by all
the Banks and the Company and acknowledged by the Agent, do any of the
following:
increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 8.02);
postpone or delay any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees or other amounts due to
the Banks (or any of them) hereunder or under any other Loan Document;
reduce the principal of, or the rate of interest specified herein on
any Loan, or (subject to clause (ii) below) any fees or other amounts payable
hereunder or under any other Loan Document;
change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for the Banks or any of them to
take any action hereunder;
amend this Section, or Section 2.13, or any provision herein
providing for consent or other action by all Banks;
modify the definition of "Majority Banks"; or
waive any Event of Default under Sections 8.01(k) or (l);
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Majority Banks or all the
Banks, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (ii) the Fee Letter may be amended, or
rights or privileges thereunder waived, in a writing executed by the parties
thereto.
Notices. (a) Except as set forth in subsection 10.02(c), all notices,
requests, consents, approvals, waivers and other communications shall be in
writing (including, unless the context expressly otherwise provides, by
facsimile transmission, provided that any matter transmitted by the Company by
facsimile shall be followed promptly by delivery of a hard copy original
thereof) and mailed, faxed or delivered, to the address or facsimile number
specified for notices on Schedule 10.02; or, as directed to the Company or the
Agent, to such other address as shall be designated by such party in a written
notice to the other parties, and as directed to any other party, at such other
address as shall be designated by such party in a written notice to the Company
and the Agent. All notices to the Company shall be sent to 00000 Xxxxx Xxxxxxx,
Xxxxxx, XX 00000, Attention: Treasurer (telecopy: 000-000-0000; telephone:
000-000-0000).
Except as set forth in subsection 10.02(c), all such notices,
requests and communications shall, when transmitted by overnight delivery, or
faxed, be effective when delivered for overnight (next-day) delivery, or
transmitted in legible form by facsimile machine, respectively, or if mailed,
upon the third Business Day after the date deposited into the U.S. mail, or if
delivered, upon delivery; except that notices pursuant to Article II or IX to
the Agent shall not be effective until actually received by the Agent.
Notwithstanding anything to the contrary herein, the Company may
borrow, continue or convert Loans via telephonic communication so long as such
telephonic communication is followed by facsimile confirmation thereof by no
later than 11:00 a.m. ( San Francisco time) on the same day.
Any agreement of the Agent and the Banks herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Company. The Agent and the Banks shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by the Company
to give such notice and the Agent and the Banks shall not have any liability to
the Company or other Person on account of any action taken or not taken by the
Agent or the Banks in reliance upon such telephonic or facsimile notice except
for gross negligence or willful misconduct on the part of the Agent and the
Banks. The obligation of the Company to repay the Loans shall not be affected
in any way or to any extent by any failure by the Agent and the Banks to receive
written confirmation of any telephonic or facsimile notice or the receipt by the
Agent and the Banks of a confirmation which is at variance with the terms
understood by the Agent and the Banks to be contained in the telephonic or
facsimile notice.
No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Agent or any Bank, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
Costs and ExpensesThe Company shall:
pay or reimburse BofA (including in its capacity as Agent) promptly
after written demand (subject to subsection 4.01(f)) for all reasonable costs
and expenses incurred by BofA (including in its capacity as Agent) in connection
with the administration and any amendment, supplement, waiver or modification to
(in each case, whether or not consummated), this Agreement, any Loan Document
and any other documents prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including
reasonable Attorney Costs incurred by BofA (including in its capacity as Agent)
with respect thereto; and
pay or reimburse the Agent, the Arranger and each Bank promptly
after written demand (subject to subsection 4.01(f)) for all reasonable costs
and expenses (including Attorney Costs) incurred by them in connection with the
enforcement, attempted enforcement, or preservation of any rights or remedies
under this Agreement or any other Loan Document during the existence of an Event
of Default or after acceleration of the Loans (including in connection with any
"workout" or restructuring regarding the Loans, and including in any Insolvency
Proceeding or appellate proceeding).
Company IndemnificationThe Company shall indemnify, defend and hold the
Agent-Related Persons, and each Bank and each of its respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement of the
Agent or replacement of any Bank) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this Agreement
or any document contemplated by or referred to herein, or the transactions
contemplated hereby, or any action taken or omitted by any such Person under or
in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding or
appellate proceeding) related to or arising out of this Agreement or the Loans
or the use of the proceeds thereof, whether or not any Indemnified Person is a
party thereto (all the foregoing, collectively, the "Indemnified Liabilities");
provided, that the Company shall have no obligation hereunder to any Indemnified
Person with respect to Indemnified Liabilities resulting solely from the gross
negligence or willful misconduct of such Indemnified Person. The agreements in
this Section shall survive payment of all other Obligations.
Payments Set Aside. To the extent that the Company makes a payment to
the Agent or the Banks, or the Agent or the Banks exercise their right of set-
off, and such payment or the proceeds of such set-off or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the Agent or
such Bank in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any Insolvency Proceeding or otherwise, then (a) to
the extent of such recovery the obligation or part thereof originally intended
to be satisfied shall be revived and continued in full force and effect as if
such payment had not been made or such set-off had not occurred, and (b) each
Bank severally agrees to pay to the Agent upon demand its pro rata share of any
amount so recovered from or repaid by the Agent.
Successors and Assigns. The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Bank.
Assignments, Participations, Etc. (a) Any Bank may, with the written
consent of the Company at all times other than during the existence of an Event
of Default and the Agent, which consent of the Company and the Agent shall not
be unreasonably withheld, at any time assign and delegate to one or more
Eligible Assignees (provided that no written consent of the Company or the Agent
shall be required in connection with any assignment and delegation by a Bank to
an Eligible Assignee that is an Affiliate of such Bank) (each an "Assignee")
all, or any ratable part of all, of the Loans, the Commitments and the other
rights and obligations of such Bank hereunder, in a minimum amount of
$10,000,000; provided, however, that the Company and the Agent may continue to
deal solely and directly with such Bank in connection with the interest so
assigned to an Assignee until (i) written notice of such assignment, together
with payment instructions, addresses and related information with respect to the
Assignee, shall have been given to the Company and the Agent by such Bank and
the Assignee; (ii) such Bank and its Assignee shall have delivered to the
Company and the Agent an Assignment and Acceptance in the form of Exhibit G
("Assignment and Acceptance") together with any Note or Notes subject to such
assignment and (iii) the assignor Bank or Assignee has paid to the Agent a
processing fee in the amount of $3,500.
From and after the date that the Agent notifies the assignor Bank
that it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank under
the Loan Documents, and (ii) the assignor Bank shall, to the extent that rights
and obligations hereunder and under the other Loan Documents have been assigned
by it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.
Within ten Business Days after its receipt of notice by the Agent
that it has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in accordance
with subsection 10.08(a)), the Company shall execute and deliver to the Agent,
new Notes evidencing such Assignee's assigned Loans and Commitment and, if the
assignor Bank has retained a portion of its Loans and its Commitment,
replacement Notes in the principal amount of the Loans retained by the assignor
Bank (such Notes to be in exchange for, but not in payment of, the Notes held by
such Bank). Immediately upon each Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the addition
of the Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Bank pro tanto.
Any Bank may at any time sell to one or more commercial banks or
other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Bank and the other interests of
that Bank (the "originating Bank") hereunder and under the other Loan Documents;
provided, however, that (i) the originating Bank's obligations under this
Agreement shall remain unchanged, (ii) the originating Bank shall remain solely
responsible for the performance of such obligations, (iii) the Company and the
Agent shall continue to deal solely and directly with the originating Bank in
connection with the originating Bank's rights and obligations under this
Agreement and the other Loan Documents, and (iv) no Bank shall transfer or grant
any participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, except to the extent such amendment, consent or waiver
would require unanimous consent of the Banks as described in the first proviso
to Section 10.01. In the case of any such participation, the Participant shall
not have any rights under this Agreement, or any of the other Loan Documents,
and all amounts payable by the Company hereunder shall be determined as if such
Bank had not sold such participation; except that, if amounts outstanding under
this Agreement are due and unpaid, or shall have been declared or shall have
become due and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Bank under this Agreement.
Notwithstanding any other provision in this Agreement, any Bank may
at any time create a security interest in, or pledge, all or any portion of its
rights under and interest in this Agreement and the Note held by it in favor of
any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR Section203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
ConfidentialityEach Bank agrees to take and to cause its Affiliates to take
normal and reasonable precautions and exercise due care to maintain the
confidentiality of all non-public information provided to it by the Company or
any Subsidiary, or by the Agent on the Company's or such Subsidiary's behalf,
under this Agreement or any other Loan Document, and neither it nor any of its
Affiliates shall use any such information other than in connection with or in
enforcement of this Agreement and the other Loan Documents or in connection with
other business now or hereafter existing or contemplated with the Company or any
Subsidiary; except to the extent such information (i) was or becomes generally
available to the public other than as a result of disclosure by the Bank, or
(ii) was or becomes available on a non-confidential basis from a source other
than the Company, provided that such source is not bound by a confidentiality
agreement with the Company known to the Bank; provided, however, that any Bank
may disclose such information (A) at the request or pursuant to any requirement
of any Governmental Authority to which the Bank is subject or in connection with
an examination of such Bank by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the Agent, any
Bank or their respective Affiliates may be party; (E) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document; (F) to such Bank's independent auditors and other
professional advisors who are bound by an ethical obligation of confidentiality
(it being understood that no written confidentiality agreements are required to
be obtained from such auditors or other professional advisors); (G) to any
Participant or Assignee, actual or potential, provided that such Person agrees
in writing to keep such information confidential to the same extent required of
the Banks hereunder; (H) as to any Bank or its Affiliate, as expressly permitted
under the terms of any other document or agreement regarding confidentiality to
which the Company or any Subsidiary is party or is deemed party with such Bank
or such Affiliate; and (I) to its Affiliates.
Set-offIn addition to any rights and remedies of the Banks provided by
law, if an Event of Default exists or the Loans have been accelerated, each Bank
is authorized at any time and from time to time, without prior notice to the
Company, any such notice being waived by the Company to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Bank to or for the credit or the account
of the Company against any and all Obligations owing to such Bank, now or
hereafter existing, irrespective of whether or not the Agent or such Bank shall
have made demand under this Agreement or any Loan Document and although such
Obligations may be contingent or unmatured. Each Bank agrees promptly to notify
the Company and the Agent after any such set-off and application made by such
Bank; provided, however, that the failure to give such notice shall not affect
the validity of such set-off and application. All set-offs shall benefit each
Bank in accordance with its Pro Rata Share and the Banks shall share any set-
offs among the Banks accordingly.
Notification of Addresses, Lending Offices, Etc. Each Bank shall
notify the Agent in writing of any changes in the address to which notices to
the Bank should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
CounterpartsThis Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an original, and
all of said counterparts taken together shall be deemed to constitute but one
and the same instrument.
SeverabilityThe illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
No Third Parties BenefitedThis Agreement is made and entered into for
the sole protection and legal benefit of the Company, the Banks, the Agent and
the Agent-Related Persons, and their permitted successors and assigns, and no
other Person shall be a direct or indirect legal beneficiary of, or have any
direct or indirect cause of action or claim in connection with, this Agreement
or any of the other Loan Documents.
Governing Law and Jurisdiction (a) THIS AGREEMENT AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
CALIFORNIA; PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA, AND BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT AND THE BANKS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT AND
THE BANKS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
Waiver of Jury TrialTHE COMPANY, THE BANKS AND THE AGENT EACH WAIVE THEIR
RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR
ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE BANKS AND THE
AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A
COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER
AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF
THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT
OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
Entire AgreementThis Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Banks and the Agent, and supersedes all prior or contemporaneous agreements
and understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in San Francisco, California by their proper and
duly authorized officers as of the day and year first above written.
AST RESEARCH, INC.
By: /s/ Xxxxxx X. Xxxxxx
Title: Senior Vice President, Legal,
Administration and Secretary
By: /s/Xxxx X. xx Xxxx
Title: Vice President, Controller
and Principal Accounting Officer
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By: /s/Xxxxx X. Xxxxx
Title: Vice President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as a Bank
By: /s/Xxxxx XxXxxxx
Title: Vice President
ROYAL BANK OF CANADA
By: /s/Xxx X. Xxxxxxxxxx
Title: Manager
BANQUE NATIONALE DE PARIS
By: /s/Xxxxx Xxxxxxx
Title: Senior Vice President and Manager
By: /s/Xxxxxxxx Xxxxxxxx
Title: Vice President
NATIONSBANK OF TEXAS, N.A.
By: /s/Xxxxx X. Xxxxx Xx.
Title: Senior Vice President
SCHEDULE 2.01
COMMITMENTS
AND PRO RATA SHARES
Pro Rata
Bank Commitment Share
Bank of America National
Trust and Savings
Association $ 25,000,000 25%
Royal Bank of Canada $ 25,000,000 25%
Banque Nationale de Paris $ 25,000,000 25%
NationsBank of Texas, N.A. $ 25,000,000 25%
TOTAL $100,000,000 100%
