EXECUTION COPY
EX-10.36
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AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 30, 2001
among
BUILDING MATERIALS HOLDING CORPORATION
and
BMC WEST CORPORATION
AND OTHER SUBSIDIARY GUARANTORS,
XXXXX FARGO BANK, N.A.,
as Administrative Agent, Lead Arranger
and
Letter of Credit Issuing Bank
FIRST UNION NATIONAL BANK,
as Syndication Agent
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS................................................. 2
1.01 Certain Defined Terms................................. 2
1.02 Other Interpretive Provisions......................... 26
1.03 Accounting Principles................................. 27
ARTICLE II THE CREDITS................................................. 27
2.01 Amounts and Terms of Commitments...................... 27
2.02 Loan Accounts......................................... 30
2.03 Procedure for Borrowing............................... 30
2.04 Conversion and Continuation Elections................. 31
2.05 Voluntary Termination or Reduction of Commitments..... 32
2.06 Swingline Loans....................................... 33
2.07 Optional Prepayments.................................. 35
2.08 Mandatory Prepayments of Loans; Mandatory Commitment
Reductions ........................................... 35
2.09 Repayment............................................. 36
2.10 Interest.............................................. 37
2.11 Fees.................................................. 37
2.12 Computation of Fees and Interest...................... 38
2.13 Payments by Holdings.................................. 38
2.14 Payments by the Banks to the Agent.................... 39
2.15 Sharing of Payments, Etc.............................. 39
2.16 Security and Guaranty................................. 40
ARTICLE III THE LETTERS OF CREDIT....................................... 40
3.01 The Letter of Credit Subfacility...................... 40
3.02 Issuance, Amendment and Renewal of Letters of Credit.. 41
3.03 Risk Participations, Drawings and Reimbursements...... 43
3.04 Repayment of Participations........................... 45
3.05 Role of the Issuing Bank.............................. 45
3.06 Obligations Absolute.................................. 46
3.07 Cash Collateral Pledge................................ 47
3.08 Letter of Credit Fees................................. 47
3.09 Applicability of Uniform Customs and Practice
and ISP 98 ........................................... 48
ARTICLE IV TAXES, YIELD PROTECTION AND ILLEGALITY...................... 48
4.01 Taxes................................................. 48
4.02 Illegality............................................ 49
4.03 Increased Costs and Reduction of Return............... 50
4.04 Funding Losses........................................ 50
4.05 Inability to Determine Rates.......................... 51
4.06 Certificates of Banks................................. 51
4.07 Substitution of Banks................................. 51
4.08 Survival.............................................. 52
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TABLE OF CONTENTS
(continued)
Page
ARTICLE V CONDITIONS PRECEDENT........................................ 52
5.01 Conditions to the Effective Date...................... 52
5.02 Conditions to the Subsequent Effective Date........... 56
5.03 Conditions to All Credit Extensions................... 57
ARTICLE VI REPRESENTATIONS AND WARRANTIES.............................. 58
6.01 Corporate Existence and Power......................... 58
6.02 Corporate Authorization; No Contravention............. 58
6.03 Governmental Authorization............................ 59
6.04 Binding Effect........................................ 59
6.05 Litigation............................................ 59
6.06 No Defaults........................................... 59
6.07 ERISA Compliance...................................... 59
6.08 Use of Proceeds; Margin Regulations................... 60
6.09 Title to Properties; Liens............................ 60
6.10 Taxes................................................. 60
6.11 Financial Condition................................... 60
6.12 Environmental Matters................................. 61
6.13 Collateral Documents.................................. 62
6.14 Regulated Entities.................................... 62
6.15 No Burdensome Restrictions............................ 63
6.16 Copyrights, Patents, Trademarks and Licenses, Etc..... 63
6.17 Subsidiaries.......................................... 63
6.18 Insurance............................................. 63
6.19 Swap Obligations...................................... 63
6.20 Real Property......................................... 64
6.21 Full Disclosure....................................... 64
ARTICLE VII AFFIRMATIVE COVENANTS....................................... 64
7.01 Financial Statements.................................. 64
7.02 Certificates; Other Information....................... 65
7.03 Notices............................................... 66
7.04 Preservation of Corporate Existence, Etc.............. 68
7.05 Maintenance of Property............................... 68
7.06 Insurance............................................. 68
7.07 Payment of Obligations................................ 68
7.08 Compliance with Laws.................................. 69
7.09 Compliance with ERISA................................. 69
7.10 Inspection of Property and Books and Records.......... 69
7.11 Environmental Laws.................................... 69
7.12 Use of Proceeds....................................... 70
7.13 Additional Guarantors................................. 70
7.14 Additional Subsidiaries............................... 71
7.15 Further Assurances.................................... 71
7.16 Post-Closing Deliveries............................... 72
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TABLE OF CONTENTS
(continued)
Page
ARTICLE VIII NEGATIVE COVENANTS.......................................... 72
8.01 Limitation on Liens................................... 72
8.02 Disposition of Assets................................. 74
8.03 Consolidations and Mergers............................ 75
8.04 Loans and Investments................................. 75
8.05 Limitation on Indebtedness............................ 76
8.06 Transactions with Affiliates.......................... 77
8.07 Use of Proceeds....................................... 77
8.08 Contingent Obligations................................ 77
8.09 Subsidiaries.......................................... 78
8.10 Lease Obligations..................................... 78
8.11 Restricted Payments................................... 78
8.12 ERISA................................................. 79
8.13 Capital Expenditures.................................. 79
8.14 Sales and Leasebacks.................................. 79
8.15 Certain Payments...................................... 79
8.16 Modification of Subordinated Debt Documents........... 79
8.17 Change in Business.................................... 80
8.18 Accounting Changes.................................... 80
8.19 Financial Covenants................................... 80
8.20 No Restrictions on Subsidiary Dividends............... 81
ARTICLE IX EVENTS OF DEFAULT........................................... 81
9.01 Event of Default...................................... 81
9.02 Remedies.............................................. 83
9.03 Specified Swap Contract Remedies...................... 84
ARTICLE X THE AGENT................................................... 84
10.01 Appointment and Authorization; "Agent"................ 84
10.02 Delegation of Duties.................................. 85
10.03 Liability of Agent.................................... 85
10.04 Reliance by Agent..................................... 85
10.05 Notice of Default..................................... 86
10.06 Credit Decision....................................... 86
10.07 Indemnification of Agent.............................. 87
10.08 Agent in Individual Capacity.......................... 87
10.09 Successor Agent....................................... 87
10.10 Withholding Tax....................................... 88
10.11 Collateral Matters.................................... 89
10.12 Senior Managing Agents; Co-Agents..................... 90
ARTICLE XI MISCELLANEOUS............................................... 90
11.01 Amendments and Waivers................................ 90
11.02 Notices............................................... 91
11.03 No Waiver; Cumulative Remedies........................ 92
iii
TABLE OF CONTENTS
(continued)
Page
11.04 Costs and Expenses.................................... 92
11.05 Indemnification....................................... 93
11.06 Marshalling; Payments Set Aside....................... 94
11.07 Successors and Assigns................................ 94
11.08 Assignments, Participations, Etc...................... 94
11.09 Confidentiality....................................... 96
11.10 Set-off............................................... 97
11.11 [Intentionally omitted.].............................. 97
11.12 Guaranty.............................................. 97
11.13 Notification of Addresses, Lending Offices, Etc....... 103
11.14 Counterparts.......................................... 103
11.15 Severability.......................................... 103
11.16 No Third Parties Benefited............................ 103
11.17 Governing Law and Jurisdiction........................ 103
11.18 Waiver of Jury Trial.................................. 104
11.19 Entire Agreement...................................... 104
iv
TABLE OF CONTENTS
(continued)
ANNEXES
Annex I Pricing Grid
SCHEDULES
Schedule 2.01 Commitments and Pro Rata Shares
Schedule 2.09 Term Loan Amortization Schedule
Schedule 6.05 Litigation
Schedule 6.07 ERISA
Schedule 6.11 Permitted Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.17 Subsidiaries and Minority Interests
Schedule 6.18 Insurance Matters
Schedule 6.20 Owned Real Property
Schedule 8.01 Permitted Liens
Schedule 8.05 Permitted Indebtedness
Schedule 8.08 Contingent Obligations
Schedule 11.02 Payment Offices; Addresses for Notices; Lending Offices
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 Counsel to Loan Parties
Exhibit E Form of Assignment and Acceptance
Exhibit F-1 Form of Revolving Note
Exhibit F-2 Form of Term Note
Exhibit G Form of Additional Guarantor Assumption Agreement
Exhibit H Form of Legal Opinion of Additional Guarantor's Counsel
Exhibit I Form of Borrowing Base Certificate
Exhibit J-1 Form of Security Agreement
Exhibit J-2 Form of First Amendment to Security Agreement
Exhibit J-3 Form of First Amendment to Intellectual Property Security Agreement
Exhibit K Form of Update Certificate
Exhibit L Form of First Amendment to Deeds of Trust
v
AMENDED AND RESTATED CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of August
30, 2001, among (i) BUILDING MATERIALS HOLDING CORPORATION, a Delaware
corporation ("Holdings"), as borrower, (ii) BMC WEST CORPORATION, a Delaware
corporation (the "Company"), and certain other affiliates of Holdings, as
guarantors, (iii) the several financial institutions from time to time party to
this Agreement (individually, a "Bank" and, collectively, the "Banks"), FIRST
UNION NATIONAL BANK, as syndication agent and (v) XXXXX FARGO BANK, N.A., as
letter of credit issuing bank and swingline bank, as administrative agent for
the Banks and as lead arranger of the credit facilities described herein.
RECITALS
A. Holdings previously entered into that certain Credit Agreement, dated
as of November 30, 1999 (as amended to the date hereof pursuant to that certain
First Amendment to Credit Agreement, dated as of June 26, 2000, the "Original
Credit Agreement") with the Company, and certain other affiliates of Holdings,
as guarantors, the several financial institutions from time to time party
thereto (collectively, the "Original Banks"), First Union National Bank, KeyBank
National Association, South Trust Bank, N.A., U.S. Bank National Association and
Xxxxx Fargo Bank, N.A., as senior managing agents, Union Bank of California,
N.A., and First Security Bank, N.A., as co-agents, and Bank of America, N.A., as
letter of credit issuing bank and swingline bank and as administrative agent for
the Original Banks (in such capacity as administrative agent, the "Original
Agent"), pursuant to which the Original Banks provided to Holdings (i) a secured
revolving line of credit facility with letter of credit subfacility and
swingline subfacility in the principal amount of $138,900,000.00 and (ii) a term
loan in the principal amount of $111,100,000.00 of which $102,767,500.00 is
outstanding on the date hereof.
B. Holdings has requested the Original Banks to amend and restate the
Original Credit Agreement to (i) replace the Original Agent with Xxxxx Fargo
Bank, N.A., as Agent; (ii) repay in full that portion of the Obligations of
those Original Banks which do not desire to become a party hereto (the "Replaced
Banks"); (iii) include each of the financial institutions who were not parties
to the Original Credit Agreement and whose names are set forth on the signature
pages hereto that desire to become parties to this Agreement as "Banks" (such
financial institutions, together with any Additional Banks (as hereinafter
defined), collectively the "New Banks"); (iv) increase the Revolving Commitment
initially to $178,916,666.67, which amount may be subsequently increased in
accordance with the terms and conditions set forth herein to an amount not to
exceed $190,000,000.00; (v) increase the Term Commitment to $103,583,333.33,
which amount may be subsequently increased in accordance with the terms and
conditions set forth herein to an amount not to exceed $110,000,000.00; (vi)
modify the amortization schedule with respect to the Term Commitment (each as
defined in Section 1.01 hereof) in accordance with the terms and conditions set
forth herein; and (vii) reallocate the outstanding Obligations among the New
Banks and those Original Banks that were parties to the Original Credit
Agreement and are to remain parties hereto (the "Remaining Banks"). (The
Remaining Banks and the New Banks together constitute the "Banks" defined
above.)
C. The parties hereto are willing so to amend and restate the Original
Credit Agreement upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
AGREEMENT
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms. The following terms have the following
meanings when used herein (including in the recitals hereof):
"Account" means for purposes of this Agreement and the Borrowing
Base Certificate any right of payment of Holdings or any of its
Subsidiaries for goods sold or leased or for services rendered in the
ordinary course of business which is not evidenced by an instrument
(except as part of chattel paper), whether or not it has been earned by
performance.
"Account Debtor" means the Person obligated on an Account.
"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 Holdings or the Company, as the case may be, or
the Subsidiary, is the surviving Person.
"Additional Banks" means the financial institutions which agree to
provide Additional Term Loans or make Additional Revolving Commitments to
Holdings in accordance with the terms and conditions set forth herein by
becoming parties to this Agreement on the Subsequent Effective Date.
"Additional Guarantor Accession Date" has the meaning specified in
Section 7.13.
"Additional Guarantor Assumption Agreement" has the meaning
specified in Section 7.13.
"Additional Revolving Commitment" has the meaning specified in
Section 2.01(d).
"Additional Term Loans" has the meaning specified in Section
2.01(c).
2
"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 Xxxxx Fargo in its capacity as administrative agent
for the Banks hereunder from and after the Effective Date as provided in
the Resignation, Assignment and Acceptance Agreement and any successor
agent arising under Section 10.09.
"Agent-Related Persons" means Xxxxx Fargo and any successor agent
arising under Section 10.09 and any successor letter of credit issuing
bank hereunder, together with their respective Affiliates (including, in
the case of Xxxxx Fargo, the Lead 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 11.02 or such other address as the Agent may from time to time
specify.
"Aggregate Commitment" means the combined Commitments of the Banks,
which combined Commitments shall not exceed $282,500,000.00 as of the
Effective Date and which amount may be increased, on the Subsequent
Effective Date, by no more than $17,500,000.00 pursuant to subsection
2.01(c) and subsection 2.01(d).
"Aggregate New Term Loan" has the meaning set forth in subsection
2.01(a).
"Aggregate Remaining Term Loan" has the meaning set forth in
subsection 2.01(a).
"Aggregate Revolving Commitment" means the combined Revolving
Commitments of the Banks, which combined Revolving Commitments shall not
exceed $178,916,666.67 as of the Effective Date, which amount includes
both the L/C Commitment and the Swingline Commitment and which amount may
be increased, on the Subsequent Effective Date, by no more than
$11,083,333.33 pursuant to subsection 2.01(d).
"Aggregate Term Commitment" means the combined Term Commitments of
the Banks, which Term Commitments shall not exceed $103,583,333.33 as of
the Effective Date and which amount may be increased, on the Subsequent
Effective Date, by no more than $6,416,666.67 pursuant to subsection
2.01(c).
"Agreement" means this Credit Agreement.
"Applicable Fee Amount" means with respect to the commitment fees
and Standby Letter of Credit fees payable hereunder, the amount set forth
opposite the indicated Level below the heading "Commitment Fee" or "Letter
of Credit Fee," as
3
applicable, in the pricing grid set forth on Annex I in accordance with
the parameters for calculations of such amount also set forth on Annex I.
"Applicable Margin" means, with respect to Base Rate Loans and
Offshore Rate Loans, the amount set forth opposite the indicated Level
below the heading "Base Rate Spread or "Offshore Rate Spread" in the
pricing grid set forth on Annex I in accordance with the parameters for
calculations of such amounts also set forth on Annex I.
"Assignee" has the meaning specified in subsection 11.08(a).
"Attorney Costs" means and includes all fees and disbursements of
any law firm or other external counsel, the allocated cost of internal
legal services and all disbursements of internal counsel.
"Available Commitment" has the meaning specific in Section 2.11(b).
"Bank" has the meaning specified in the introductory clause hereto,
provided, however, that after the Subsequent Effective Date, any
Additional Banks shall also be deemed "Banks" for all purposes hereunder.
References to the "Banks" shall include Xxxxx Fargo, including in its
capacity as Issuing Bank and Swingline Bank; for purposes of clarification
only, to the extent that Xxxxx Fargo may have any rights or obligations in
addition to those of the Banks due to its status as Issuing Bank or
Swingline Bank, its status as such will be specifically referenced. Unless
the context otherwise clearly requires, "Bank" includes any such
institution in its capacity as Swap Provider. Unless the context otherwise
clearly requires, references to any such institution as a "Bank" shall
also include any of such institution's Affiliates that may at any time of
determination be Swap Providers.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. ss. 101, 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 Xxxxx Fargo
as its prime rate. (The prime rate is a rate set by Xxxxx Fargo based upon
various factors including Xxxxx Fargo'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 prime rate announced by Xxxxx Fargo
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.
"Borrowing" means a borrowing hereunder consisting of (i) Loans of
the same Type made to Holdings on the same day by the Banks under Article
II, and, in the case of Offshore Rate Loans, having the same Interest
Period, or (ii) a Swingline Loan (or Swingline Loans) made to Holdings on
the same day by the Swingline Banks, (iii) an L/C Borrowing.
4
"Borrowing Base" means, at any time, an amount equal to the sum of:
(i) 80% of the value of the Accounts; plus (ii) 60% of the value of the
Inventory. As used in this definition, "value" as applied to Inventory
shall mean the lower of cost and market, or if there at any time exist any
other matters, events, conditions or contingencies which the Majority
Banks reasonably believe may cause a material portion of the Accounts to
be unpaid, the Majority Banks, in their sole discretion, may exclude any
of the Accounts or Inventory from the Borrowing Base if the Majority Banks
reasonably determine that the inclusion of such Account or Inventory in
the Borrowing Base would have a Material Adverse Effect.
"Borrowing Base Certificate" means a certificate substantially in
the form of Exhibit I.
"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 London or other 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.
"Capitalization" means, as at any date, for Holdings and its
Subsidiaries on a consolidated basis in accordance with GAAP, the sum of
Funded Debt plus Stockholder's Equity.
"Capital Expenditure Annual Limit" means, for any fiscal year, the
sum of (a) $30,000,000 plus (b) 3.0% of the aggregate sales reported by
all Persons acquired by Holdings or its Subsidiaries in such fiscal year
pursuant to a Permitted Acquisition, as reported by each such acquired
Person in its financial statements for such Person's then most recent
fiscal year-end, plus (c) the amount of proceeds of any Disposition or
Event of Loss which are reinvested as Capital Expenditures within six (6)
months of Holdings' or any Subsidiary's receipt of such proceeds.
"Capital Expenditures" means, for any period, the aggregate of all
expenditures (including the current portion of Capital Leases) which are
required to be capitalized on the consolidated balance sheet of Holdings
and its Subsidiaries during that period, in accordance with GAAP,
excluding Acquisitions permitted by subsection 8.04(d).
"Capital Lease" means, for any Person, any lease of property
(whether real, personal or mixed) which, in accordance with GAAP, would,
at the time a determination is made, be required to be recorded as a
capital lease in respect of which such Person is liable as lessee.
5
"Cash Collateralize" means to pledge and deposit with or deliver to
the Agent, for the benefit of the Agent, the Issuing Bank and the Banks,
as additional collateral for the L/C Obligations, cash or deposit account
balances pursuant to the Security Agreement. Derivatives of such term
shall have corresponding meaning.
"Change of Control" means any person or group of persons (within the
meaning of Section 13 or 14 of the Exchange Act) shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 promulgated by the
SEC under said Act) of 20% or more of the outstanding shares of common
stock of Holdings; or, during any period of twelve consecutive calendar
months, individuals who were directors of Holdings on the first day of
such period shall cease to constitute a majority of the board of directors
of Holdings.
"Closing Date" means November 30, 1999 (which is the date on which
the Original Credit Agreement closed).
"Code" means the Internal Revenue Code of 1986.
"Collateral" means all property and interests in property and
proceeds thereof now owned or hereafter acquired by Holdings and its
Subsidiaries in or upon which a Lien (i) existed in favor of the Original
Banks or the Original Agent on behalf of the Original Banks immediately
prior to the Effective Date now or (ii) now or hereafter exists in favor
of the Banks, or the Agent on behalf of the Banks on and after the
Effective Date, whether under this Agreement or under any other Collateral
Documents.
"Collateral Documents" means, collectively, (i) the Security
Agreement, the Intellectual Property Security Agreements, the Mortgages
and all other security agreements mortgages, deeds of trust, patent and
trademark assignments, lease assignments and other similar agreements
between Holdings or any Subsidiary and the Banks, or the Agent for the
benefit of the Banks, now or hereafter delivered to the Banks or the Agent
pursuant to or in connection with the transactions contemplated hereby,
and all financing statements (or comparable documents now or hereafter
filed in accordance with the Uniform Commercial Code or comparable law)
against Holdings or any Subsidiary as debtor in favor of the Banks, or the
Agent for the benefit of the Banks, as secured party, and (ii) any
amendments, supplements, modifications, renewals, replacements,
consolidations, substitutions and extensions of any of the foregoing.
"Commercial Letter of Credit" means a commercial Letter of Credit
Issued for the account of Holdings in respect of the purchase of Inventory
or other goods and services by Holdings or any of its Subsidiaries in the
ordinary course of business.
"Commitment," as to each Bank, means the sum of its Revolving
Commitment and Term Commitment.
"Company" has the meaning specified in the introductory paragraph
hereof.
"Compliance Certificate" means a certificate substantially in the
form of Exhibit C.
6
"Consolidated Net Worth" means, as of the date of determination, the
consolidated shareholders' equity of Holdings and its Subsidiaries, as
determined in accordance with GAAP.
"Consolidated Net Income" means, as of the date of determination,
the consolidated net income of Holdings and its Subsidiaries, as
determined in accordance with GAAP.
"Consolidated Total Assets" means, as of the date of determination,
the consolidated total assets of Holdings and its Subsidiaries, as
determined in accordance with GAAP.
"Contingent Obligation" means (without duplication), as to any
Person, any direct or indirect liability of that Person, whether or not
contingent, with or without recourse, (a) with respect to any
Indebtedness, lease, dividend, letter of credit or other obligation (the
"primary obligations") of another Person (the "primary obligor"),
including any obligation of that Person (i) to purchase, repurchase or
otherwise acquire such primary obligations or any security therefor, (ii)
to advance or provide funds for the payment or discharge of any such
primary obligation, or to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency or
any balance sheet item, level of income or financial condition of the
primary obligor, (iii) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation, (iv) in connection with any synthetic lease or other
similar off balance sheet lease transaction, or (v) otherwise to assure or
hold harmless the holder of any such primary obligation against loss in
respect thereof (each a "Guaranty Obligation"); (b) with respect to any
Surety Instrument issued for the account of that Person or as to which
that Person is otherwise liable for reimbursement of drawings or payments;
(c) to purchase any materials, supplies or other property from, or to
obtain the services of, another Person if the relevant contract or other
related document or obligation requires that payment for such materials,
supplies or other property, or for such services, shall be made regardless
of whether delivery of such materials, supplies or other property is ever
made or tendered, or such services are ever performed or tendered; (d) in
respect of Earn-Out Obligations; (e) in respect of any Swap Contract; and
(f) in respect of Stock Price Guaranties. The amount of any Contingent
Obligation shall, in the case of Guaranty Obligations, be deemed equal to
the stated or determinable amount of the primary obligation in respect of
which such Guaranty Obligation is made or, if not stated or if
indeterminable, the maximum reasonably anticipated liability in respect
thereof, and in the case of other Contingent Obligations other than in
respect of Swap Contracts, shall be equal to the maximum reasonably
anticipated liability in respect thereof and, in the case of Contingent
Obligations in respect of Swap Contracts, shall be equal to the Swap
Termination Value.
"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.
7
"Conversion/Continuation Date" means any date on which, under
Section 2.04, Holdings (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 Exposure" has the meaning specified in the definition of
Majority Banks.
"Credit Extension" means and includes (a) the making of any
Revolving Loans, Term Loans or Swingline Loans hereunder, and (b) the
Issuance of any Letters of Credit 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.
"Disposition" means the sale, lease, conveyance or other disposition
of property, other than sales or other dispositions expressly permitted
under subsections 8.02(a) through 8.02(h).
"Disposition Value" means the aggregate net book value of all assets
sold, transferred, leased or disposed of in any transaction determined as
of the date of such transfer or proposed transfer thereof.
"Dollars," "dollars" and "$" each mean lawful money of the United
States.
"Earn-out Obligations" means any obligations, whether contingent or
matured, to pay additional consideration in connection with the
Acquisition by Holdings or any Subsidiary of any capital stock or assets
of any Person.
"EBITA" means, for any period, for Holdings and its Subsidiaries,
the sum of consolidated net income (exclusive of extraordinary gains and
losses and exclusive of earnings from Minority Investments) of Holdings
and its Subsidiaries for such period plus (to the extent deducted in
determining consolidated net income) (i) Interest Expense for such period,
(ii) income tax expense for such period, (iii) amortization expense and
other non-cash expenses for such period (other than depreciation expense)
and (iv) cash dividends in respect of Minority Investments, in each case,
measured in accordance with GAAP.
"EBITDA" means, for any period, for Holdings and its Subsidiaries,
the sum of consolidated net income (exclusive of extraordinary gains and
losses and exclusive of earnings from Minority Investments) of Holdings
and its Subsidiaries for such period plus (to the extent deducted in
determining consolidated net income) (i) Interest Expense for such period,
(ii) income tax expense for such period, (iii) depreciation expense,
amortization expense and other non-cash expenses for such period and (iv)
cash dividends in respect of Minority Investments, in each case, measured
in accordance with GAAP. For purposes of determining the consolidated
EBITDA of Holdings and its Subsidiaries hereunder for purposes of
calculating the EBITDA Ratio hereunder, EBITDA shall be adjusted upon the
Permitted Acquisition of any acquired Subsidiary
8
(the "Acquiree") (A) to include the historical financial results of such
Acquiree for the four fiscal quarter period ("Calculation Period") for
which Holdings' consolidated EBITDA is calculated hereunder, until such
time as the first day of any Calculation Period falls on or after the date
on which the Acquisition of such Acquiree is consummated; and (B) to
exclude any specific, identifiable expense items which are eliminated as a
result of the Permitted Acquisition of such Acquiree at the closing
thereof, provided that audited financial statements accompanied by an
unqualified opinion of an Independent Auditor are delivered to the Agent
and the Banks in respect of such Acquiree for the then most recent fiscal
year of such Acquiree, and provided further that Holdings shall have
delivered a certificate of a Responsible Officer clearly setting forth
such pro forma additions to consolidated EBITDA resulting from the
Permitted Acquisition of such Acquiree.
"EBITDA Ratio" means, as of the end of any fiscal quarter, measured
on a consolidated basis for Holdings and its Subsidiaries as of such date,
the ratio of (i) Total Funded Debt existing on such date to (ii) EBITDA
for the period of four fiscal quarters ending on such date.
"Effective Amount" means (i) with respect to any Revolving Loans,
Term Loans and Swingline Loans on any date, the aggregate outstanding
principal amount thereof after giving effect to any Borrowings and
prepayments or repayments of Revolving Loans, Term Loans and Swingline
Loans occurring on such date; and (ii) with respect to any outstanding L/C
Obligations on any date, the amount of such L/C Obligations on such date
after giving effect to any Issuances of Letters of Credit occurring on
such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements
of outstanding unpaid drawings under any Letters of Credit or any
reductions in the maximum amount available for drawing under Letters of
Credit taking effect on such date; provided that for purposes of Section
2.08, the Effective Amount shall be determined without giving effect to
any mandatory prepayments to be made under Section 2.08.
"Effective Date" means the date on which all conditions precedent
set forth in Section 5.01 are satisfied or waived by all Banks (or, in the
case of subsection 5.01(f), waived by the Person entitled to receive such
payment).
"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 $100,000,000; (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 $100,000,000, provided that such bank is acting
through a branch or agency located in the United States; 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.
9
"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 or threat to public health, personal injury
(including sickness, disease or death), property damage, natural resources
damage, or otherwise alleging liability or responsibility for damages
(punitive or otherwise), cleanup, removal, remedial or response costs,
restitution, civil or criminal penalties, injunctive relief, or other type
of relief, resulting from or based upon the presence, placement,
discharge, emission or release (including intentional and unintentional,
negligent and non-negligent, sudden or non-sudden, accidental or
non-accidental, placement, spills, leaks, discharges, emissions or
releases) of any Hazardous Material at, in, or from any property, whether
or not owned by Holdings or any Subsidiary.
"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; including the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 ("CERCLA"), the Clean Air
Act, the Federal Water Pollution Control Act of 1972, the Solid Waste
Disposal Act, the Federal Resource Conservation and Recovery Act, the
Toxic Substances Control Act, the Emergency Planning and Community
Right-to-Know Act, the California Hazardous Waste Control Law, the
California Solid Waste Management, Resource, Recovery and Recycling Act,
the California Water Code and the California Health and Safety Code.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with Holdings or 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 Holdings, 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
Holdings, 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 Holdings, the Company or any ERISA Affiliate.
10
"Estimated Remediation Costs" means all costs associated with
performing work to remediate contamination of real property or
groundwater, including engineering and other professional fees and
expenses, costs to remove, transport and dispose of contaminated soil,
costs to "cap" or otherwise contain contaminated soil, and costs to pump
and treat water and monitor water quality.
"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 9.01.
"Event of Loss" means, with respect to any property, any of the
following: (a) any loss, destruction or damage of such property; (b) any
pending or threatened institution of any proceedings for the condemnation
or seizure of such property or for the exercise of any right of eminent
domain; or (c) any actual condemnation, seizure or taking, by exercise of
the power of eminent domain or otherwise, of such property, or
confiscation of such property or the requisition of the use of such
property.
"Exchange Act" means the Securities Exchange Act of 1934.
"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 with
respect to the preceding Business Day opposite the caption "Federal Funds
(Effective)"; or, if for any relevant day such rate is not so published
with respect to 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 2.11(a).
"First Amendment to Deeds of Trust" means those certain First
Amendments to Deeds of Trust, each dated as of the Effective Date, among
Holdings, the Guarantors party thereto and Agent in substantially the form
of Exhibit L.
"First Amendment to Intellectual Property Security Agreements" means
those certain First Amendments to Intellectual Property Security
Agreements, each dated as of the Effective Date, between Holdings, the
Guarantors party thereto and the Agent for the benefit of the Banks in
substantially the form of Exhibit J-3.
"First Amendment to Security Agreement" means that certain First
Amendment to Security Agreement, dated as of the Effective Date, between
Holdings, the Guarantors party thereto and the Agent for the benefit of
the Banks in substantially the form of Exhibit J-2.
11
"FRB" means the Board of Governors of the Federal Reserve System,
and any Governmental Authority succeeding to any of its principal
functions.
"Funded Debt" means, as of any date of determination, all
Indebtedness of Holdings and its Subsidiaries on such date, on a
consolidated basis in accordance with GAAP, including all Revolving Loans
and all Term Loans, but excluding all L/C Obligations.
"Further Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges (including net income taxes and franchise taxes), and all
liabilities with respect thereto, imposed by any jurisdiction on account
of amounts payable or paid pursuant to Section 4.01.
"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, subject to Section
1.03.
"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 the Company and each other direct or indirect
Subsidiary of Holdings party to a Guaranty in its capacity as a guarantor
hereunder.
"Guaranty" means the guaranty of each Guarantor made pursuant to
Section 11.12 and any other guaranty under any separate agreement executed
by any Guarantor pursuant to which it guarantees the Obligations.
"Guaranty Obligation" has the meaning specified in the definition of
"Contingent Obligation."
"Hazardous Materials" means all those substances that are regulated
by, or which may form the basis of liability under, any Environmental Law,
including any substance identified under any Environmental Law as a
pollutant, contaminant, hazardous waste, hazardous constituent, special
waste, hazardous substance, hazardous material, or toxic substance, or
petroleum or petroleum derived substance or waste.
"Holdings" means Building Materials Holding Corporation, a Delaware
corporation.
"Honor Date" has the meaning specified in subsection 3.03(b).
12
"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
trade payables entered into in the ordinary course of business on ordinary
terms but including all non-contingent Earn-Out Obligations); (c) all
reimbursement or payment obligations with respect to Surety Instruments
(contingent or otherwise); (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);
(f) all obligations with respect to Capital Leases; (g) all indebtedness
referred to in clauses (a) through (f) above secured by (or for which the
holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including
accounts and contracts rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such
Indebtedness; (h) all Guaranty Obligations in respect of indebtedness or
obligations of others of the kinds referred to in clauses (a) through (g)
above; and (i) all Stock Price Guaranties having a tenor of six (6) months
or more or exceeding $2,000,000 in the aggregate for all Stock Price
Guaranties then outstanding. For all purposes of this Agreement, the
Indebtedness of any Person shall include all recourse Indebtedness of any
partnership or joint venture or limited liability company in which such
Person is a general partner or a joint venturer or a member.
"Indemnified Liabilities" has the meaning specified in Section
11.05.
"Indemnified Person" has the meaning specified in Section 11.05.
"Independent Auditor" has the meaning specified in subsection
7.01(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; in either case undertaken under U.S. Federal,
state or foreign law, including the Bankruptcy Code.
"Intellectual Property Security Agreement" has the meaning specified
in the Security Agreement.
"Interest Expense" means, for any period, for Holdings and its
Subsidiaries in accordance with GAAP, all interest in respect of
Indebtedness accrued or capitalized during such period (whether or not
actually paid during such period).
13
"Interest Payment Date" means, (i) as to any Offshore Rate Loan, the
last day of each Interest Period applicable to such Loan, (ii) as to any
Base Rate Loan, the last Business Day of each calendar quarter and the
Revolving Termination Date (in the case of Revolving Loans) and the Term
Maturity Date (in the case of Term Loans) and (iii) as to any Swingline
Loan, each of the last Business Day of each calendar month and the
Revolving Termination Date; provided, however, that if any Interest Period
for an Offshore Rate Loan exceeds three months, the date that falls three
months after the beginning of such Interest Period and after each Interest
Payment Date thereafter is also an Interest Payment Date.
"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, as selected by Holdings in its Notice of
Borrowing or Notice of Conversion/ Continuation; 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 Term Loan shall extend beyond
the Term Maturity Date and no Interest Period for any Revolving Loan
shall extend beyond the Revolving Termination Date; and
(iv) no Interest Period applicable to a Term Loan or portion
thereof shall extend beyond any date upon which is due any scheduled
principal payment in respect of the Term Loans unless the aggregate
principal amount of Term Loans represented by Base Rate Loans or
Offshore Rate Loans having Interest Periods that will expire on or
before such date, equals or exceeds the amount of such principal
payment.
"Inventory" shall mean for purposes of this Agreement and the
Borrowing Base Certificate all goods of Holdings or any of its
Subsidiaries held for sale or lease in the ordinary course of business,
work in progress and any and all raw materials used in connection with the
foregoing.
"Investment" has the meaning specified in Section 8.04.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
14
"Issuance Date" has the meaning specified in subsection 3.01(a).
"Issue" means, with respect to any Letter of Credit, to issue or to
extend the expiry of, or to renew or increase the amount of or otherwise
amend, such Letter of Credit; and the terms "Issued," "Issuing" and
"Issuance" have corresponding meanings.
"Issuing Bank" means Xxxxx Fargo in its capacity as issuer of one or
more Letters of Credit hereunder, together with any replacement letter of
credit issuer arising under subsection 10.01(b) or Section 10.09.
"L/C Advance" means each Bank's participation in any L/C Borrowing
in accordance with its Pro Rata Share.
"L/C Amendment Application" means an application form for amendment
of outstanding Standby or Commercial Letters of Credit as shall at any
time be in use at the Issuing Bank, as the Issuing Bank shall request.
"L/C Application" means an application form for issuances of Standby
or Commercial Letters of Credit as shall at any time be in use at the
Issuing Bank, as the Issuing Bank shall request.
"L/C Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been reimbursed on
the date when made nor converted into a Borrowing of Revolving Loans under
subsection 3.03(c).
"L/C Commitment" means the commitment of the Issuing Bank to Issue,
and the commitment of the Banks severally to participate in, Letters of
Credit from time to time Issued or outstanding under Article III, in an
aggregate amount not to exceed on any date the amount of $20,000,000, as
the same shall be reduced as a result of a reduction in the L/C Commitment
pursuant to Section 2.05 or 2.08; provided that the L/C Commitment is a
part of the combined Revolving Commitments of the Banks rather than a
separate, independent commitment; and provided further that if as a result
of any Commitment reductions hereunder the L/C Commitment shall exceed the
combined Revolving Commitments of the Banks, the L/C Commitment shall
automatically reduce by the amount of such excess.
"L/C Obligations" means at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of all unreimbursed drawings under all Letters of Credit, including
all outstanding L/C Borrowings.
"L/C-Related Documents" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of Credit, including any of the Issuing Bank's
standard form documents for letter of credit issuances.
"Lead Arranger" means Xxxxx Fargo Bank, N.A., in its capacity as
Sole Lead Arranger and Sole Book Manager.
15
"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 11.02, or
such other office or offices as such Bank may from time to time notify to
Holdings and the Agent.
"Letters of Credit" means any letters of credit Issued by the
Issuing Bank pursuant to Article III (which may be Commercial Letters of
Credit or Standby Letters of Credit).
"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 Holdings under
Article II, which may be a Base Rate Loan, an Offshore Rate Loan or a
Swingline Loan (each a "Type" of Loan), and includes a Revolving Loan or
Term Loan, or Article III in the form of an L/C Advance.
"Loan Documents" means this Agreement, any Notes, any Guaranty, the
Collateral Documents, the Fee Letter, the L/C-Related Documents, any
documents evidencing or relating to Specified Swap Contracts and all other
documents delivered to the Agent or any Bank in connection herewith.
"Loan Party" means the Company, Holdings and each other Subsidiary
of Holdings party hereto as a Guarantor.
"Majority Banks" means at any time Banks then holding in excess of
50% of the then aggregate Credit Exposure of all the Banks, or, if no
Credit Exposure exists, Banks then having in excess of 50% of the
Aggregate Commitment. As used in this definition, the "Credit Exposure" of
any Bank means (i) with respect to any outstanding Revolving Loans, the
aggregate outstanding principal amount of the Revolving Loans made by such
Bank, (ii) with respect to any outstanding Term Loans, the aggregate
outstanding principal amount of the Term Loans made by such Bank, and
(iii) with respect to any outstanding Swingline Loans and L/C Obligations,
the participating interest therein equal to such Bank's Pro Rata Share
thereof.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change in, or
a material adverse effect upon, the operations, business, properties,
condition (financial or
16
otherwise) or prospects of Holdings or Holdings and its Subsidiaries taken
as a whole; (b) a material impairment of the ability of any Loan Party to
perform under any Loan Document and to avoid any Event of Default; or (c)
a material adverse effect upon (i) the legality, validity, binding effect
or enforceability against any Loan Party of any Loan Document or (ii) the
perfection or priority of any Lien granted under the Collateral Documents.
"Minimum Amount" means (i) in respect of any Borrowing, conversion
or continuation of Loans, (a) in the case of Base Rate Loans, an aggregate
minimum amount of $5,000,000 or any integral multiple of $1,000,000 in
excess thereof, (b) in the case of Offshore Rate Loans, an aggregate
minimum amount of $5,000,000 or any integral multiple of $1,000,000 in
excess thereof and (c) in the case of Swingline Loans, an aggregate
minimum amount of $100,000 or any integral multiple of $100,000 in excess
thereof (or such other amount as shall be acceptable to the Swingline
Bank), (ii) in the case of any reduction of the Commitments under Section
2.05, $5,000,000 or any multiple of $1,000,000 in excess thereof, and
(iii) in the case of any optional prepayment of Loans under Section 2.07,
$1,000,000 or any multiple of $1,000,000 in excess thereof.
"Minority Investment" means the direct or indirect Investment by
Holdings in any Person, provided in each case that such Person is not a
Subsidiary at the time of such Investment and after giving effect thereto.
"Mortgage" means any deed of trust, mortgage, leasehold mortgage,
assignment of rents or other document creating a Lien on real property or
any interest in real property.
"Mortgaged Property" means all property subject to a Lien pursuant
to a Mortgage.
"Multiemployer Plan" means a "multiemployer plan," within the
meaning of Section 4001(a)(3) of ERISA, to which Holdings, 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.
"Net Issuance Proceeds" means, as to any issuance of debt or equity
by any Person, cash proceeds received or receivable by such Person in
connection therewith, net of out-of-pocket costs and expenses paid or
incurred in connection therewith in favor of any Person not an Affiliate
of such Person.
"Net Proceeds" means, as to any Disposition by a Person, proceeds in
cash, checks or other cash equivalent financial instruments as and when
received by such Person, net of: (i) the direct costs relating to such
Disposition excluding amounts payable to such Person or any Affiliate of
such Person, (ii) sale, use or other transaction taxes and capital gains
taxes paid or payable by such Person as a direct result thereof, and (iii)
amounts required to be applied to repay principal, interest and prepayment
premiums and penalties on Indebtedness secured by a purchase money
security interest on any asset which is the subject of such Disposition.
"Net Proceeds" shall also include proceeds paid
17
on account of any Event of Loss, net of (i) all money actually applied to
repair or reconstruct the damaged property or property affected by the
condemnation or taking, (ii) all of the costs and expenses incurred in
connection with the collection of such proceeds, award or other payments,
and (iii) any amounts retained by or paid to parties having superior
rights to such proceeds, awards or other payments. For purposes of
determining the amount of Net Proceeds in respect of any Disposition or
Event of Loss, however, the amount of proceeds calculated as provided
above shall be reduced by the amount of such proceeds that such Person has
used (or intends to use within six months of the date of receipt of such
proceeds) to pay the purchase price in connection with any Permitted
Acquisition, Minority Investment or any Capital Expenditures (to the
extent permitted hereunder), it being understood that any portion of such
proceeds that has not been so used within such six month period shall be
deemed to be Net Proceeds received on the last day of such six month
period and that all such proceeds shall be deemed to be Net Proceeds at
any time that an Event of Default exists hereunder.
"New Banks" has the meaning set forth in Recital B.
"New Term Loan" has the meaning set forth in Section 2.01(a).
"Notes" means the Revolving Notes and the Term Notes.
"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.
"Obligations" means the Revolving Loans, Term Loans Swingline Loans,
L/C Obligations and other Indebtedness arising under any Loan Document
owing by Holdings to any Bank, the Agent, the Issuing Bank, the Swingline
Bank 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 (rounded upward to the next 1/16th of 1%) determined by
the Agent as follows:
LIBOR
Offshore Rate = ----------------------------
1.00 - Eurodollar Reserve
Percentage
Where,
"Eurodollar Reserve Percentage" means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
(whether or not applicable to any Bank) under regulations issued
from time to time by the FRB for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"); and
18
"LIBOR" means: (i) the rate of interest per annum determined by the
Agent to be the rate of interest per annum (rounded upward to the
nearest 1/100th of 1%) appearing on Dow Xxxxx Page 3750 (as defined
below) for Dollar deposits having a maturity comparable to such
Interest Period, at approximately 11:00 a.m. (London time) two
Business Days prior to the commencement of such Interest Period,
subject to clause (ii) below; or (ii) if for any reason the rate is
not available as provided in the preceding clause (i) of this
definition, "LIBOR" instead means the rate of interest per annum
determined by the Agent to be the arithmetic mean (rounded upward to
the nearest 1/16th of 1%) of the rates of interest per annum
notified to the Agent by Xxxxx Fargo as the rate of interest at
which Dollar deposits in the approximate amount of the Offshore Rate
Loan to be made, continued or converted by Xxxxx Fargo, 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. As used in this
definition, "Dow Xxxxx Page 3750" means the display designated as
"3750" on the Dow Xxxxx Market Service (formerly known as the
Telerate Service) or any replacement page thereof or successor
thereto.
The Offshore Rate shall be adjusted automatically as to all Offshore
Rate Loans then outstanding as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate.
"Operating Lease" means, for any Person, any lease of property
(whether real, personal or mixed) which, in accordance with GAAP, would,
at the time a determination is made, be required to be recorded as an
operating lease in respect of which such Person is liable as lessee.
"Original Agent" means Bank of America, N.A., in its capacity as
Administrative Agent under the Original Credit Agreement.
"Original Banks" has the meaning specified in Recital A.
"Original Credit Agreement" has the meaning specified in Recital A.
"Organization Documents" means, for any Person, 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, any other applicable
organizational or constitutional documents and all applicable resolutions
of the board of directors (or any committee thereof) of such Person
"Other Taxes" means any present or future stamp, court 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, performance, enforcement or
19
registration of, or otherwise with respect to, this Agreement or any other
Loan Documents.
"Participant" has the meaning specified in subsection 11.08(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 Holdings or 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 Acquisition" means any Acquisition that conforms to the
following requirements: (a) the assets, Person, division or line of
business to be acquired is in a substantially similar or ancillary line of
business as the Company, (b) the Agent and the Banks shall have received
promptly, and in any event no less than ten (10) Business Days prior to
the consummation of such Acquisition, (i) financial information regarding
the assets, Person or business to be acquired, including the most recent
audited financial statements, if available, but in any case the most
recently prepared balance sheet, statement of income and statement of cash
flows for the assets, Person or business to be acquired and pro forma
projected financial statements showing the effect of the Acquisition of
the assets, Person or business on Holdings, including a balance sheet for
Holdings and its Subsidiaries as of the time of the Acquisition and
projected statements of income and cash flows for Holdings and its
Subsidiaries through at least the Revolving Termination Date, and (ii) a
completed worksheet in substantially the form of Schedule 1 to the
Compliance Certificate demonstrating Holdings' pro forma compliance with
the financial covenants set forth in Section 8.19, measured as of the last
day of the fiscal quarter then most recently ended, after giving effect to
such Acquisition, (c) all transactions related to such Acquisition shall
be consummated in accordance with applicable Requirements of Law, (d) such
Acquisition shall be non-hostile in nature, (e) the prior, effective
written consent or approval to such Acquisition of the board of directors
or equivalent governing body of the acquiree is obtained, (f) immediately
after giving effect to such Acquisition: (i) no Default or Event of
Default shall have occurred and be continuing or would result therefrom,
(ii) 100% of the capital stock of any acquired or newly formed
corporation, partnership, limited liability company or other business
entity is owned directly by Holdings or a U.S. Wholly-Owned Subsidiary of
Holdings, and (iii) all actions required to be taken with respect to such
acquired or newly formed Subsidiary under Section 7.13 or as otherwise
required under Section 7.14 shall have been taken, and (g) in the case of
any Significant Acquisition, the Majority Banks shall have consented in
writing to the consummation of such Acquisition.
"Permitted Capital Expenditure Carry-Forward" means, for any fiscal
year, the Dollar amount equal to (a) the maximum Dollar amount of Capital
Expenditures permitted to be incurred by Holdings and its Subsidiaries in
such fiscal year under
20
Section 8.13 minus (b) the Dollar amount of Capital Expenditures actually
incurred by Holdings and its Subsidiaries in such fiscal year.
"Permitted Equity Offering" means an offering by Holdings of
preferred stock or other equity interests of Holdings, if the rights,
preferences, privileges and use of proceeds of such equity offering have
been approved by the Majority Banks in writing prior to issuance, provided
that no such securities shall be issued if a Default or Event of Default
exists prior to, or immediately after, such issuance.
"Permitted Liens" has the meaning specified in Section 8.01.
"Permitted Subordinated Debt" has the meaning specified in Section
8.05(h).
"Permitted Swap Obligations" means all obligations (contingent or
otherwise) of Holdings or any Subsidiary existing or arising under Swap
Contracts, provided that each of the following criteria is satisfied: (a)
such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly mitigating risks associated
with liabilities, commitments or assets held or reasonably anticipated by
such Person, or changes in the value of securities issued by such Person
in conjunction with a securities repurchase program not otherwise
prohibited hereunder, and not for purposes of speculation or taking a
"market view;" (b) such Swap Contracts do not contain (i) any provision
("walk-away" provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the defaulting
party, or (ii) any provision creating or permitting the declaration of an
event of default, termination event or similar event upon the occurrence
of an Event of Default hereunder (other than an Event of Default under
subsection 9.01(a)).
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or any
other entity of whatever nature.
"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which Holdings or the Company sponsors or maintains or to which
Holdings or the Company makes, is making, or is obligated to make
contributions and includes any Pension Plan.
"Pledged Collateral" means the "Pledged Collateral" as defined in
the Security Agreement and shall include all products and Proceeds (as
defined in the Security Agreement) of the Pledged Collateral.
"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 (a) in the case of the Revolving Commitments or the Revolving
Loans, such Bank's Revolving Commitment divided by the combined Revolving
Commitments of all Banks (or, if all Revolving Commitments have been
terminated, the aggregate principal amount of such Bank's Revolving Loans
divided by the aggregate principal amount of the Revolving Loans then held
by all Banks), and (b) in the case of the Term Commitments or the Term
Loans, such Bank's Term Commitment divided by the combined Term
Commitments of
21
all Banks (or, if all Term Commitments have been terminated, the aggregate
principal amount of such Bank's Term Loans divided by the aggregate
principal amount of Term Loans then held by all Banks). The initial Pro
Rata Shares of each Bank are set forth opposite such Bank's name in
Schedule 2.01 under the heading "Pro Rata Share (Revolving Commitments)"
and "Pro Rata Share (Term Commitments)."
"Reimbursement Date" has the meaning specified in Section 3.03.
"Remaining Bank" has the meaning specified in Recital B.
"Replaced Bank" has the meaning specified in Recital B.
"Replacement Bank" has the meaning specified in Section 4.07.
"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.
"Resignation, Assignment and Acceptance Agreement" means that
certain Resignation, Assignment and Acceptance Agreement, dated as of the
Effective Date, among the Agent, the Original Agent, Holdings, the
Guarantors party thereto, the Replaced Banks and the Remaining Banks.
"Responsible Officer" means as to any Person, the chief executive
officer or the president of such Person, or any other officer having
substantially the same authority and responsibility; or, with respect to
compliance with financial covenants, the chief financial officer or the
treasurer of such Person, or any other officer having substantially the
same authority and responsibility.
"Revolving Commitment," as to each Bank, has the meaning specified
in subsection 2.01(b).
"Revolving Loan" has the meaning specified in Section 2.01.
"Revolving Note" means a promissory note executed by Holdings in
favor of a Bank pursuant to subsection 2.02(b), in substantially the form
of Exhibit F-1
"Revolving Termination Date" means the earlier to occur of: (a)
December 1, 2004; and (b) the date on which the Revolving Commitments
terminate in accordance with the provisions of this Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
22
"Security Agreement" means that certain Security Agreement, dated as
of November 30, 1999, among Holdings, the Company, certain other
Affiliates of Holdings listed therein and the Original Agent, in
substantially the form of Exhibit J-1.
"Senior Funded Debt" means, as of any date of determination, all
Funded Debt of Holdings and its Subsidiaries on such date which is not
subordinated in right of payment to the Obligations, on a consolidated
basis in accordance with GAAP.
"Significant Acquisition" means (a) any Acquisition by Holdings or
any Subsidiary in respect of which cash or cash equivalents and/or
assumption and/or incurrence of Indebtedness exceeding $25,000,000 in the
aggregate constitutes all or a portion of the consideration therefor, and
(b) any Acquisition by Holdings or any Subsidiary at any time that cash or
cash equivalents and/or assumption and/or incurrence of Indebtedness
exceeding $25,000,000 in the aggregate has constituted (or, immediately
after giving effect to such Acquisition, shall have constituted) all or a
portion of the consideration for all Acquisitions by Holdings and its
Subsidiaries consummated in the then current fiscal year.
"Specified Swap Contract" means any Swap Contract made or entered
into at any time, or in effect at any time (whether heretofore or
hereafter), whether directly or indirectly, and whether as a result of
assignment or transfer or otherwise, between Holdings and any Swap
Provider which Swap Contract is or was intended by Holdings to have been
entered into for purposes of mitigating interest rate or currency exchange
risk relating to any Loan (which intent shall conclusively be deemed to
exist if Holdings so represents to the Swap Provider in writing), and as
to which the final scheduled payment by Holdings is not later than the
Revolving Termination Date.
"Standby Letter of Credit" means a standby Letter of Credit Issued
for the account of Holdings to support obligations of Holdings or any
Subsidiary, contingent or otherwise.
"Stockholder's Equity" shall mean, at any date, as applied to
Holdings, the aggregate sum of Holdings' stock, capital surplus and
retained earnings (or minus accumulated deficit), determined on a
consolidated basis in accordance with GAAP.
"Stock Price Guaranty" means a guaranty that (i) is issued by
Holdings or an Affiliate of Holdings in connection with the Acquisition of
another Person, and (ii) is for the payment of cash or issuance of
Holdings' common stock if the common stock issued by Holdings in
connection with such an Acquisition is sold for less than the price
provided for in the guaranty during its term, provided that for purposes
of determining the amount of any Stock Price Guaranty, the amount of such
guaranty shall be equal to (a) the guaranteed stock price multiplied by
the number of shares covered by the guaranty, minus (b) the current fair
market value of one share of Holdings' common stock (which fair market
value shall be equal to the five day trailing average closing price for
Holdings' common stock as reported by the Nasdaq National Stock Market)
multiplied by the number of shares covered by the guaranty, provided
further, that for
23
purposes of determining the amount of any Stock Price Guaranty which is
payable solely in common stock of Holdings, the amount of such Stock Price
Guaranty shall equal zero.
"Subordinated Debt Documents" means any documents and instruments
evidencing any Permitted Subordinated Debt.
"Subsequent Effective Date" means the date on which all conditions
precedent set forth in Section 5.02 are satisfied or waived by all
Additional Banks which date (if it shall occur) shall occur on or prior to
one hundred eighty (180) days after the Effective Date.
"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 Holdings.
"Surety Instruments" means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, shipside bonds,
surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap
or option, bond, note or xxxx option, interest rate option, forward
foreign exchange transaction, cap, collar or floor transaction, currency
swap, cross-currency rate swap, swaption, currency option or any other,
similar transaction (including any option to enter into any of the
foregoing) or any combination of the foregoing, and, unless the context
otherwise clearly requires, any master agreement relating to or governing
any or all of the foregoing.
"Swap Provider" means any Bank, or any Affiliate of any Bank, that
is at the time of determination party to a Swap Contract with Holdings.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or
after the date such Swap Contracts have been closed out and termination
value(s) determined in accordance therewith, such termination value(s),
and (b) for any date prior to the date referenced in clause (a) the
amount(s) determined as the xxxx-to-market value(s) for such Swap
Contracts, as determined by Holdings based upon one or more mid-market or
other readily available quotations provided by any recognized dealer in
such Swap Contracts (which may include any Bank).
"Swingline Bank" means Xxxxx Fargo, in its capacity as maker of
Swingline Loans hereunder. Specific reference to the Swingline Bank shall
exclude the Swingline Bank in its capacity as a Bank hereunder.
24
"Swingline Commitment" has the meaning specified in subsection
2.06(a).
"Swingline Loan" has the meaning specified in subsection 2.06(a).
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case
of each Bank and the Agent, respectively, taxes imposed on or measured by
its net income by the jurisdiction (or any political subdivision thereof)
under the laws of which such Bank or the Agent, as the case may be, is
organized or maintains a Lending Office.
"Term Commitment," as to each Bank, has the meaning specified in
subsection 2.01(a).
"Term Loan" has the meaning specified in subsection 2.01(a).
"Term Maturity Date" means December 1, 2004.
"Term Note" means a promissory note executed by Holdings in favor of
a Bank pursuant to subsection 2.02(b), in substantially the form of
Exhibit F-2.
"Total Assets" means for any date the net book value of the
consolidated assets of Holdings and its Subsidiaries as of the end of the
fiscal quarter ended on or most recently prior to such date.
"Total Funded Debt" means, as of any date of determination, all
Funded Debt of Holdings and its Subsidiaries on such date, on a
consolidated basis in accordance with GAAP.
"Type" has the meaning specified in the definition of "Loan."
"UCC" means the Uniform Commercial Code as in effect in the State of
California.
"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.
"Update Certificate" means a certificate in substantially the form
of Exhibit K.
"U.S. Subsidiary" and "U.S. Wholly-Owned Subsidiary" means a
Subsidiary or Wholly-Owned Subsidiary, as the case may be, that is located
in and a resident of the United States.
25
"Xxxxx Fargo" means Xxxxx Fargo Bank, N.A., a national banking
association, or any successor by merger thereto.
"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 Holdings, or by
one or more of the other Wholly-Owned Subsidiaries, or both.
1.02 Other Interpretive Provisions. (a) The meanings of defined terms are
equally applicable to the singular and plural forms of the defined terms.
(b) 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.
(c) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(d) The term "including" is not limiting and means "including
without limitation."
(e) 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."
(f) 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 (unless any such prohibitive term has been
waived), 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.
(g) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(h) 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. Unless otherwise expressly
provided, any reference to any action of the Agent or the Banks by way of
consent, approval or waiver shall be deemed modified by the phrase "in its/their
sole discretion."
(i) This Agreement and the other Loan Documents are the result of
negotiations among the Agent, Holdings, the Company and the other parties, have
been reviewed by counsel to the Agent, Holdings, the Company and such other
parties, and are the products of all parties.
26
Accordingly, they shall not be construed against the Banks or the Agent merely
because of the Agent's or Banks' involvement in their preparation.
1.03 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; provided, however, that if GAAP
shall have been modified after the Effective Date and the application of such
modified GAAP shall have a material effect on such financial computations
(including the computations required for the purpose of determining compliance
with the covenants set forth in Article VIII), then such computations shall be
made and such financial statements, certificates and reports shall be prepared,
and all accounting terms not otherwise defined herein shall be construed, in
accordance with GAAP as in effect prior to such modification, unless and until
the Majority Banks and Holdings shall have agreed upon the terms of the
application of such modified GAAP.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of Holdings.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments.
(a) The Term Credit. Holdings hereby acknowledges and agrees that
pursuant to the Original Credit Agreement, the Original Banks provided to
Holdings term loans in the aggregate principal amount of $111,100,000.00, of
which $102,767,500.00 is outstanding on the date hereof (the "Aggregate
Remaining Term Loan"). Subject to the conditions set forth herein, each Bank
severally agrees that on the Effective Date, it shall make a new single loan
denominated in Dollars to Holdings in the amount of such Bank's Pro Rata Share
of $815,833.33 (each a "New Term Loan" and collectively, the "Aggregate New Term
Loans") such that the sum of the aggregate principal amount of the Aggregate
Remaining Term Loan and the Aggregate New Term Loan is equal to the Aggregate
Term Commitment. The parties hereto further acknowledge and agree that on and
after the Effective Date, each Remaining Bank and each New Bank shall be a Bank
under this Agreement and the other Loan Documents with Term Loans, Term
Commitments and Pro Rata Shares as set forth on Schedule 2.01 attached hereto
(each Pro Rata Share of such loan, a "Term Loan" and each Pro Rata Share of the
Aggregate Term Loan Commitment, a "Term Loan Commitment") in an aggregate amount
not to exceed the Aggregate Term Commitment, with the rights, duties and
obligations of such a Bank under this Agreement and the other Loan Documents. To
effect the foregoing, on the Effective Date, Agent shall calculate the Pro Rata
Share of each Remaining Bank and each New Bank of the Aggregate Term Commitment.
Based upon such calculation, each New Bank and any applicable Remaining Bank
shall purchase from the Original Banks such portion of the Aggregate Remaining
Term Loan as Agent determines is necessary (after taking into account
application of amounts advanced by each Bank in connection with the Aggregate
New Term Loan) to cause each Remaining Bank and each New Bank to hold such Pro
Rata Share of the outstanding aggregate Term Loans in a principal amount equal
to such Remaining Bank's and such New
27
Bank's Pro Rata Share of such Aggregate Term Commitment. On and after the
Effective Date, the Effective Amount of all outstanding Revolving Loans plus the
Effective Amount of all Swingline Loans plus the Effective Amount of all L/C
Obligations plus the Effective Amount of all outstanding Term Loans shall not
exceed the Aggregate Commitment. Amounts that have been borrowed as Term Loans
which are repaid or prepaid by Holdings may not be reborrowed. The Term Loans of
the Remaining Banks and the New Banks shall be deemed to be Term Loans of such
Banks under this Agreement and the other Loan Documents for all purposes.
(b) The Revolving Credit. Holdings hereby acknowledges and agrees
that pursuant to the Original Credit Agreement, the Original Banks provided to
Holdings revolving loans from time to time of which
[$_____________]82,900,000.00 in aggregate principal amount is outstanding on
the date hereof. Subject to the conditions set forth herein, the parties hereto
hereby acknowledge and agree that on and after the Effective Date, each
Remaining Bank and each New Bank shall be a Bank under this Agreement and the
other Loan Documents with Revolving Commitments and Pro Rata Shares as set forth
on Schedule 2.01 attached hereto (each such commitment, a "Revolving
Commitment") in an aggregate amount not to exceed the Aggregate Revolving
Commitment, with the rights, duties and obligations of such a Bank under this
Agreement and the other Loan Documents. To effect the foregoing, on the
Effective Date, Agent shall calculate the Pro Rata Share of each Remaining Bank
and each New Bank in each Revolving Loan then outstanding (each such loan,
together with all other loans advanced from time to time pursuant to this
Section 2.01(b), a "Revolving Loan"). Based upon such calculation, each New Bank
and any applicable Remaining Bank shall purchase from the Original Banks such
shares in the outstanding Revolving Loans as Agent determines is necessary to
cause each Remaining Bank and each New Bank to hold Revolving Loans in each
outstanding Revolving Loan Borrowing in a principal amount equal to such
Remaining Bank's and such New Bank's Pro Rata Share of such Revolving Loan
Borrowings. On and after the Effective Date, after giving effect to any
Borrowing of Revolving Loans, (i) the Effective Amount of all outstanding
Revolving Loans and Swingline Loans and the Effective Amount of all L/C
Obligations shall not exceed an amount equal to the lesser of (1) the combined
Revolving Commitments of the Banks and (2) the Borrowing Base; and (ii) the
Effective Amount of the Revolving Loans of any Bank plus the participation of
such Bank in the Effective Amount of all L/C Obligations and the Effective
Amount of all Swingline Loans shall not at any time exceed such Bank's Revolving
Commitment. Within the limits of each Bank's Revolving Commitment, and subject
to the other terms and conditions hereof, Holdings may borrow under this Section
2.01, prepay under Section 2.07 and reborrow under this Section 2.01.
(c) Additional Term Loans. Upon Holding's written notice to the
Agent, on the Subsequent Effective Date one or more Additional Banks may become
parties to this Agreement for the purpose of making additional Term Loans in an
aggregate amount not to exceed $6,416,666.67 (each Additional Bank's Pro Rata
Share of such amount, an "Additional Term Commitment"). On the Subsequent
Effective Date, each Additional Bank shall make a new single loan denominated in
Dollars to Holdings in the amount of such Bank's Pro Rata Share of the
Additional Term Commitment (the "Additional Term Loan") upon the terms and
subject to the conditions contained herein, as such terms and conditions may be
amended pursuant to Section 11.01 hereof, and any Additional Banks shall become
parties to this Agreement by executing a counterpart signature page to this
Agreement and shall be treated as a Bank for all purposes of this Agreement from
and after the Subsequent Effective Date. Once the Additional
28
Term Loans shall have been made pursuant to this Agreement, (i) Schedule 2.01
hereto shall be deemed to have been amended to include all Additional Banks
party to this Agreement together with such Additional Banks' respective Term
Commitment and Pro Rate Share, (ii) Schedule 2.01 hereto shall be deemed to have
been amended to adjust the Pro Rata Share of all other Banks party hereto, (iii)
Schedule 2.09 hereto shall be deemed to have been amended to include the then
applicable Term Loan amortization schedule based upon the percentages set forth
therein, and (iv) the definitions of "Aggregate Term Commitment" and "Aggregate
Commitment" shall be deemed to have been amended to include the Additional Term
Commitments made by such Additional Banks on the Subsequent Effective Date. On
and after the Subsequent Effective Date, the Effective Amount of all outstanding
Revolving Loans plus the Effective Amount of all Swingline Loans plus the
Effective Amount of all L/C Obligations plus the Effective Amount of all
outstanding Term Loans shall not exceed the then applicable Aggregate
Commitment. The Additional Term Loans of the Additional Banks shall be deemed to
be Term Loans of such Banks under this Agreement and the other Loan Documents
for all purposes.
(d) Additional Revolving Commitments. Upon Holding's written notice
to the Agent, on the Subsequent Effective Date one or more Additional Banks may
provide additional Revolving Commitments in an aggregate amount not to exceed
$11,083,333.33 (each such additional commitment, the "Additional Revolving
Commitment"), which Additional Revolving Commitment may thereafter be made
available to Holdings as Revolving Loans. Any Additional Banks shall become
parties to this Agreement by executing a counterpart signature page to this
Agreement and shall be treated as a Banks for all purposes of this Agreement
from and after the Subsequent Effective Date. Once such Additional Revolving
Commitments shall be deemed to have been made available pursuant to this
Agreement, (i) Schedule 2.01 hereto shall be deemed to have been amended to
include all Additional Banks party to this Agreement together with such
Additional Bank's respective Revolving Commitment and Pro Rate Share, (ii)
Schedule 2.01 hereto shall be deemed to have been amended to adjust the Pro Rata
Share of all other Banks party hereto, and (iii) the definitions of "Aggregate
Revolving Commitment" and "Aggregate Commitment" shall be deemed to have been
amended to include the Additional Revolving Commitments provided by such
Additional Banks on the Subsequent Effective Date. To effect the foregoing, on
the Subsequent Effective Date, Agent shall calculate the Pro Rata Share of each
Bank and each Additional Bank in each Revolving Loan then outstanding. Based
upon such calculation, each Additional Bank shall purchase from the other Banks
such portion of the Aggregate Revolving Loans outstanding immediately prior to
the Subsequent Effective Date as Agent determines is necessary to cause each
Bank to hold Revolving Loans in a principal amount equal to such Bank's Pro Rata
Share of such Revolving Loan Borrowings. On and after the Subsequent Effective
Date, after giving effect to any Borrowing of Revolving Loans, (i) the Effective
Amount of all outstanding Revolving Loans and Swingline Loans and the Effective
Amount of all L/C Obligations shall not exceed an amount equal to the lesser of
(1) the combined Revolving Commitments of the Banks and (2) the Borrowing Base;
and (ii) the Effective Amount of the Revolving Loans of any Bank plus the
participation of such Bank in the Effective Amount of all L/C Obligations and
the Effective Amount of all Swingline Loans shall not at any time exceed such
Bank's Revolving Commitment. On and after the Subsequent Effective Date, each
Additional Bank shall be a Bank under this Agreement and the other Loan
Documents with Revolving Commitments and Pro Rata Shares as set forth on
Schedule 2.01 attached hereto in an aggregate amount not to exceed the Aggregate
Revolving Commitment,
29
with the rights, duties and obligations of such a Bank under this Agreement and
the other Loan Documents.
2.02 Loan Accounts. (a) The Loans made by each Bank and the Letters of
Credit Issued by the Issuing Bank shall be evidenced by one or more accounts or
records maintained by such Bank or Issuing Bank, as the case may be, in the
ordinary course of business. The accounts or records maintained by the Agent,
the Issuing Bank and each Bank shall be conclusive absent manifest error of the
amount of the Loans made by the Banks to Holdings and the Letters of Credit
Issued for the account of Holdings, 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 Holdings hereunder to pay any amount owing
with respect to the Loans or any Letter of Credit.
(b) 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 Holdings with respect thereto. Each
such Bank is irrevocably authorized by Holdings 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
Holdings hereunder or under any such Note to such Bank.
2.03 Procedure for Borrowing. (a) Each Borrowing of Loans shall be made
upon Holdings' irrevocable written notice delivered to the Agent in the form of
a Notice of Borrowing (which notice must be received by the Agent (i) prior to
9:00 a.m. (San Francisco time) at least three Business Days prior to the
requested Borrowing Date, in the case of Offshore Rate Loans, except in the case
of Swingline Loans, in which case such notice must be received by 9:00 a.m. (San
Francisco time) on the requested Borrowing Date; and (ii) prior to 9:00 a.m.
(San Francisco time) on the requested Borrowing Date, in the case of Base Rate
Loans, specifying:
(i) the amount of the Borrowing, which shall be in a Minimum Amount,
and whether such Borrowing shall be of Term Loans or Revolving Loans;
(ii) the requested Borrowing Date, which shall be a Business Day;
(iii) the Type of Loans comprising the Borrowing; and
(iv) if applicable, the duration of the Interest Period applicable
to such Loans included in such notice, subject to the provisions of the
definition of "Interest Period" herein. 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 one month;
provided, however, that with respect to the Borrowing to be made on the
Effective Date, the Notice of Borrowing shall be delivered to the Agent not
later than 11:00 a.m. (San Francisco time) one Business Day before the Effective
Date and such Borrowing will consist of Base Rate Loans only; and further
provided that if so requested by the Agent, all Borrowings during the first 60
days following the Effective Date shall have the same Interest Period and shall
be Base Rate Loans or Offshore Rate Loans for Interest Periods no longer than
one month.
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(b) 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.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of Holdings at the Agent's
Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by Holdings in funds immediately available to the Agent. The proceeds
of each such Borrowing will then be made available to Holdings by the Agent at
such office by crediting the account of Holdings on the books of Xxxxx Fargo
with the aggregate of the amounts made available to the Agent by the Banks and
in like funds as received by the Agent, or if requested by Holdings, by wire
transfer in accordance with written instructions provided to the Agent by
Holdings of such funds as received by the Agent, unless on the date of the
Borrowing all or any portion of the proceeds thereof shall then be required to
be applied to the repayment of any outstanding Loans, in which case such
proceeds or portion thereof shall be applied to the payment of such Loans.
(d) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than eight different Interest Periods
in effect.
2.04 Conversion and Continuation Elections. (a) Holdings may, upon
irrevocable written notice to the Agent in accordance with subsection 2.04(b):
(i) 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
Offshore Rate Loans, to convert any such Loans (or any part thereof in a Minimum
Amount) into Loans of any other Type; or
(ii) elect, as of the last day of the applicable Interest Period, to
continue any Revolving Loans or Term Loans having Interest Periods expiring on
such day (or any part thereof in a Minimum Amount);
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 $5,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of Holdings to continue such Loans as, and convert such Loans into, Offshore
Rate Loans, shall terminate.
(b) Holdings shall deliver a Notice of Conversion/Continuation to be
received by the Agent (i) not later than 9:00 a.m. (San Francisco time) at least
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)
prior to 9:00 a.m. (San Francisco time) on the Conversion/Continuation Date, if
the Loans are to be converted into Base Rate Loans, specifying:
(i) the proposed Conversion/Continuation Date;
(ii) the aggregate amount of Loans to be converted or
continued;
(iii) the Type of Loans resulting from the proposed conversion
or continuation; and
31
(iv) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period, subject to the provisions
of the definition of "Interest Period" herein.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, Holdings has failed to select timely a new Interest Period
to be applicable to such Offshore Rate Loans, as the case may be, or if any
Default or Event of Default then exists, Holdings 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.
(d) The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by
Holdings, 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.
(e) Unless the Majority Banks otherwise consent, during the
existence of a Default or Event of Default, Holdings may not elect to have a
Loan converted into or continued as an Offshore Rate Loan.
(f) 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.
2.05 Voluntary Termination or Reduction of Commitments. (a) Holdings may,
upon not less than three Business Days' prior notice to the Agent, terminate the
Revolving Commitments, or permanently reduce the Revolving Commitments, provided
that the aggregate amount of any partial reduction is in a Minimum Amount;
unless, after giving effect thereto and to any prepayments of any Loans made on
the effective date thereof, (i) the Effective Amount of all Revolving Loans,
Swingline Loans and L/C Obligations together would exceed the amount of the
combined Revolving Commitments of the Banks then in effect, or (ii) the
Effective Amount of all L/C Obligations then outstanding would exceed the L/C
Commitment. Once reduced in accordance with this Section 2.05, the Revolving
Commitments may not be increased. Any reduction of the Revolving Commitments
shall be applied to each Bank according to its Pro Rata Share. If and to the
extent specified by Holdings in the notice to the Agent, some or all of the
reduction in the Revolving Commitments shall be applied to reduce the L/C
Commitment. All accrued commitment and letter of credit fees to, but not
including, the effective date of any reduction or termination of Revolving
Commitments, shall be paid on the effective date of such reduction or
termination.
(b) At no time shall the Swingline Commitment exceed the combined
Revolving Commitments of the Banks, and any reduction of the Revolving
Commitments which reduces combined Revolving Commitments of the Banks below the
then-current amount of the Swingline Commitment shall result in an automatic
corresponding reduction of the Swingline Commitment to the amount of the
combined Revolving Commitments of the Banks, as so reduced, without any action
on the part of the Swingline Bank.
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2.06 Swingline Loans. (a) Subject to the terms and conditions hereof, the
Swingline Bank agrees to make a portion of the Revolving Commitment available to
Holdings by making swingline loans denominated in Dollars (individually, a
"Swingline Loan", and, collectively, the "Swingline Loans") to Holdings on any
Business Day during the period from the Effective Date to the Revolving
Termination Date in accordance with the procedures set forth in this Section
2.06 in an aggregate principal amount at any one time outstanding not to exceed
Fifteen Million Dollars ($15,000,000), notwithstanding the fact that such
Swingline Loans, when aggregated with any other Credit Extensions made by or
participated in by the Swingline Bank, may exceed the Swingline Bank's Revolving
Commitment (the amount of such commitment of the Swingline Bank to make
Swingline Loans to Holdings pursuant to this subsection 2.06(a), as the same
shall be reduced pursuant to Section 2.05 or 2.08 or as a result of any
assignment pursuant to Section 11.08, the Swingline Bank's "Swingline
Commitment"); provided that at no time shall (i) the sum of the Effective Amount
of all Swingline Loans plus the Effective Amount of all Revolving Loans plus the
Effective Amount of all L/C Obligations exceed the combined Revolving
Commitments of the Banks, or (ii) the Effective Amount of all Swingline Loans
exceed the Swingline Commitment. Additionally, no more than three Swingline
Loans may be outstanding at any one time, and all Swingline Loans shall at all
times accrue interest at the Base Rate or at such other rate as may be agreed to
by the Swingline Bank and Holdings. Within the foregoing limits, and subject to
the other terms and conditions hereof, Holdings may borrow under this subsection
2.06(a), prepay pursuant to Section 2.07 and reborrow pursuant to this
subsection 2.06(a).
(b) Holdings shall provide the Agent irrevocable written notice
(including notice via facsimile confirmed immediately by a telephone call) in
the form of a Notice of Borrowing of any Swingline Loan requested hereunder
(which notice must be received by the Agent prior to 9:00 a.m. (San Francisco
time) on the requested Borrowing Date) specifying (i) the amount to be borrowed,
which shall be in a Minimum Amount, and (ii) the requested Borrowing Date, which
shall be a Business Day. Unless the Swingline Bank has received notice prior to
9:00 a.m. (San Francisco time) on such Borrowing Date from the Agent (including
at the request of any Bank) (A) directing the Swingline Bank not to make the
requested Swingline Loan as a result of the limitations set forth in the proviso
set forth in the first sentence of subsection 2.06(a); or (B) that one or more
conditions specified in Article V are not then satisfied; then, subject to the
terms and conditions hereof, the Swingline Bank will, not later than 12:00 noon
(San Francisco time) on the Borrowing Date specified in such Notice of
Borrowing, make the amount of its Swingline Loan available to Holdings by
crediting the account of Holdings on the books of Xxxxx Fargo or if requested by
Holdings, by wire transfer in accordance with written instructions provided to
the Agent by Holdings. The Agent will notify the Banks on a quarterly basis if
any Swingline Loan Borrowings occurred during such quarter.
(c) Holdings shall repay to the Swingline Bank in full on the
Revolving Termination Date the aggregate principal amount of the Swingline Loans
outstanding on the Revolving Termination Date.
(d) For one Business Day during each successive seven Business Day
period the aggregate principal amount of Swingline Loans shall be $0 (a
"Clean-Up Day"). Holdings shall prepay the outstanding principal amount of the
Swingline Loans in whole to the extent required so that a Clean-Up Day may occur
in each such seven Business Day period as provided in this
33
subsection 2.06(d) (which Swingline Loans may not be reborrowed until such
Clean-Up Day has ended).
(e) If:
(i) any Swingline Loans shall remain outstanding at 4:00 p.m. (San
Francisco time) on the Business Day immediately prior to a Clean-Up Day and by
such time on such Business Day the Agent shall have received neither: (A) a
Notice of Borrowing delivered pursuant to Section 2.03 requesting that Revolving
Loans be made pursuant to subsection 2.01 on the Clean-Up Day in an amount at
least equal to the aggregate principal amount of such Swingline Loans; nor (B)
any other notice indicating Holdings' intent to repay such Swingline Loans with
funds obtained from other sources; or
(ii) any Swingline Loans shall remain outstanding during the
existence of an Event of Default and the Swingline Bank shall in its sole
discretion notify the Agent that the Swingline Bank desires that such Swingline
Loans be converted into Revolving Loans;
then the Agent shall be deemed to have received a Notice of Borrowing from
Holdings pursuant to Section 2.03 requesting that Base Rate Loans be made
pursuant to subsection 2.01 on such Clean-Up Day (in the case of the
circumstances described in clause (i) above) or on the first Business Day
subsequent to the date of such notice from the Swingline Bank (in the case of
the circumstances described in clause (ii) above) in an amount equal to the
aggregate amount of such Swingline Loans, and the procedures set forth in
subsections 2.03(b) and 2.03(c) shall be followed in making such Base Rate
Loans; provided, that such Base Rate Loans shall be made notwithstanding
Holdings' failure to comply with Section 5.02; and provided, further, that if a
Borrowing of Revolving Loans becomes legally impracticable and if so required by
the Swingline Bank at the time such Revolving Loans are required to be made by
the Banks in accordance with this subsection 2.06(e), each Bank agrees that in
lieu of making Revolving Loans as described in this subsection 2.06(e), such
Bank shall purchase a participation from the Swingline Bank in the applicable
Swingline Loans in an amount equal to such Bank's Pro Rata Share of such
Swingline Loans, and the procedures set forth in subsections 2.03(b) and 2.03(c)
shall be followed in connection with the purchases of such participations. Upon
such purchases of participations the prepayment requirements of subsection
2.06(d) shall be deemed waived with respect to such Swingline Loans. If any
Swingline Loan shall remain outstanding in lieu of a Borrowing of Revolving
Loans as provided above, interest on such Swingline Loan shall be due and
payable on demand and shall accrue at the rate then applicable to Base Rate
Loans. The proceeds of such Base Rate Loans, or participations purchased, shall
be applied to repay such Swingline Loans. A copy of each notice given by the
Agent to the Banks pursuant to this subsection 2.06(e) with respect to the
making of Revolving Loans, or the purchases of participations, shall be promptly
delivered by the Agent to Holdings. Each Bank's obligation in accordance with
this Agreement to make the Revolving Loans, or purchase the participations, as
contemplated by this subsection 2.06(e), shall be absolute and unconditional and
shall not be affected by any circumstance, including (1) any set-off,
counterclaim, recoupment, defense or other right which such Bank may have
against the Swingline Bank, Holdings or any other Person for any reason
whatsoever; (2) the occurrence or continuance of a Default, an Event of Default
or a Material Adverse Effect; or (3) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
34
2.07 Optional Prepayments. Subject to Section 4.04, Holdings may, at any
time or from time to time, upon not less than three Business Days' irrevocable
notice to the Agent, ratably prepay Loans in whole or in part, in Minimum
Amounts. Such notice of prepayment shall specify the date and amount of such
prepayment, whether such prepayment of Loans is of Term Loans, Revolving Loans
or Swingline Loans (or a combination thereof) and the Type(s) of Loans to be
prepaid. The Agent will promptly notify the Swingline Bank (in the case of any
prepayment of Swingline Loans) and 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
Holdings, Holdings shall make such prepayment and the payment amount specified
in such notice shall be due and payable on the date specified therein, together
with (other than in the case of Base Rate Loans) accrued interest to each such
date on the amount prepaid and any amounts required pursuant to Section 4.04.
Optional prepayments of Term Loans shall be applied to reduce the Term Loans
with respect to each remaining installment of principal pro rata in accordance
with the then remaining installments payable under subsection 2.09(a).
2.08 Mandatory Prepayments of Loans; Mandatory Commitment Reductions. (a)
If on the Effective Date the aggregate Term Commitments shall exceed the
outstanding principal amount of the Term Loans made, such unused portion of the
Term Commitments shall automatically terminate on the Effective Date.
(b) If at any time the Effective Amount of Revolving Loans and
Swingline Loans plus the Effective Amount of any L/C Obligations shall exceed
the Borrowing Base, Holdings, within 15 Business Days of the earlier of (i) the
date a Responsible Officer of Holdings became aware of such excess, and (ii)
notice from the Agent informing Holdings of the existence of such excess, shall
prepay the outstanding principal amount of the Loans and any L/C Advances, in an
amount equal to such excess and, if necessary (after giving effect to such
prepayment), shall also Cash Collateralize outstanding Letters of Credit in an
amount equal to the excess of the maximum amount then available to be drawn
under the Letters of Credit over the Borrowing Base.
(c) If on any date the Effective Amount of L/C Obligations exceeds
the L/C Commitment, Holdings shall Cash Collateralize on such date the
outstanding Letters of Credit in an amount equal to the excess of the maximum
amount then available to be drawn under the Letters of Credit over the Aggregate
L/C Commitment.
(d) If on any date (after giving effect to any Cash
Collateralization made on such date pursuant to subsection 2.08(b)), the
Effective Amount of all Revolving Loans and Swingline Loans then outstanding
plus the Effective Amount of all L/C Obligations exceeds the combined Revolving
Commitments of the Banks, Holdings shall immediately, and without notice or
demand, prepay the outstanding principal amount of the Revolving Loans,
Swingline Loans and L/C Advances by an amount equal to the applicable excess.
(e) If Holdings, the Company or any other Subsidiary shall at any
time or from time to time make or agree to make a Disposition, then (i) Holdings
shall promptly notify the Agent in advance of such Disposition (including the
amount of the estimated Net Proceeds to be received by Holdings, the Company or
such other Subsidiary in respect thereof) and (ii) if, after giving effect to
such Disposition, the Net Proceeds of all Dispositions which have occurred in
35
such fiscal year are greater than $1,000,000 in the aggregate, then promptly
upon, and in no event later than one Business Day after, receipt by Holdings,
the Company or the other Subsidiary of the Net Proceeds of such Disposition,
Holdings shall prepay Term Loans in an aggregate amount equal to the amount of
all Net Proceeds received by Holdings, the Company or any other Subsidiary on
account of all Dispositions which have occurred in such fiscal year less the
amount, if any, of Net Proceeds already so applied in such fiscal year.
(f) If Holdings, the Company or any other Subsidiary shall at any
time or from time to time issue any debt or equity securities for cash
consideration in excess of $5,000,000, then (i) Holdings shall promptly notify
the Agent in advance of the estimated Net Issuance Proceeds of such issuance and
(ii) promptly upon, and in no event later than one Business Day after, receipt
by Holdings, the Company or the other Subsidiary of the Net Issuance Proceeds of
such issuance, Holdings shall prepay Term Loans in an aggregate amount equal to
the amount of all Net Issuance Proceeds received by Holdings, the Company or any
such other Subsidiary on account of such issuance unless such equity securities
were issued pursuant to a Permitted Equity Offering and the Majority Banks shall
have approved such other use of the Net Issuance Proceeds.
(g) Any prepayments pursuant to this Section 2.08 shall be subject
to Section 4.04 and applied, first, to Swingline Loans (only if such prepayment
is pursuant to Subsection 2.08(b)) then outstanding, second, to any Base Rate
Loans then outstanding and then to Offshore Rate Loans with the shortest
Interest Periods remaining; provided, however, that if the amount of Swingline
Loans and Base Rate Loans then outstanding is not sufficient to satisfy the
entire prepayment requirement, Holdings may, at its option, place any amounts
which it would otherwise be required to use to prepay Offshore Rate Loans on a
day other than the last day of the Interest Period therefor in an
interest-bearing account pledged to the Agent for the benefit of the Banks until
the end of such Interest Period at which time such pledged amounts will be
applied to prepay such Offshore Rate Loans. Holdings shall pay, together with
each prepayment under this Section 2.08, accrued interest on the amount of any
Offshore Rate Loans prepaid and any amounts required pursuant to Section 4.04.
Prepayments of Term Loans pursuant to this Section 2.08 shall be applied to
reduce the Term Loans with respect to each remaining installment of principal
thereof pro rata in accordance with the then remaining installments payable
under subsection 2.09(a).
2.09 Repayment. (a) The Term Loans. Holdings shall repay to the Agent for
the account of the Banks the aggregate principal amount of Term Loans in
quarterly installments on the last Business Day of each calendar quarter (each a
"Principal Payment Date"), commencing on September 30, 2002, in the applicable
amounts set forth on Schedule 2.09 hereto (or as such Schedule may be amended
pursuant to Section 2.01(c) hereof).
(b) The Revolving Loans and Swingline Loans. Holdings shall repay to
the Agent for the account of the Banks on the Revolving Termination Date the
aggregate principal amount of Revolving Loans and Swingline Loans outstanding on
such date.
2.10 Interest. (a) (i) Each Revolving Loan and Term 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 Holdings' right to
36
convert to other Types of Loans under Section 2.04), plus the Applicable Margin;
and (ii) each Swingline Loan shall bear interest on the outstanding principal
amount thereof from the applicable Borrowing Date at a rate per annum equal to
the Base Rate plus the Applicable Margin, or at such other rate as may be agreed
to by the Swingline Bank.
(b) Interest on each Revolving Loan, Term Loan and Swingline Loan
shall be paid in arrears on each Interest Payment Date. Interest shall also be
paid on the date of any prepayment of Loans (other than Base Rate Loans) under
Section 2.07 or 2.08 for the portion of such 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.
(c) Notwithstanding subsection (a) of this Section, while any Event
of Default exists or after acceleration, Holdings 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 2% 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 the Applicable Margin then in
effect for Base Rate Loans, plus 2% per annum; 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 the Applicable Margin then in effect for Base Rate Loans, plus
2% per annum.
(d) Anything herein to the contrary notwithstanding, the obligations
of Holdings 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
Holdings shall pay such Bank interest at the highest rate permitted by
applicable law.
2.11 Fees. In addition to certain fees described in Section 3.08:
(a) Arrangement and Agency Fees. Holdings shall pay an arrangement
fee to the Lead Arranger for the Lead 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 (the "Fee Letter") between Holdings and the Lead Arranger and Agent
dated June 26, 2001.
(b) Commitment Fees. Holdings shall pay to the Agent for the account
of each Bank a commitment fee on the actual daily unused portion of such Bank's
Revolving Commitment (the "Available 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 at a rate per
annum equal to the Applicable Fee Amount. For purposes of calculating the
Available Commitment under this Section 2.11, the Revolving Commitments shall be
deemed used to the extent of the Effective Amount of Revolving Loans then
outstanding, plus the Effective Amount of L/C Obligations then outstanding
(other than L/C
37
Obligations consisting of the aggregate undrawn amount of all Commercial Letters
of Credit then outstanding). Swingline Loans shall not constitute utilization.
Such commitment fee shall accrue from the Effective 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 September 30, 2001, to the
Revolving Termination Date, with the final payment to be made on the Revolving
Termination Date; provided that in connection with any termination of
Commitments hereunder, the accrued commitment fee calculated for the period
ending on such date shall also be paid on the date of termination. 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 V are not met.
2.12 Computation of Fees and Interest. (a) All computations of interest
for Base Rate Loans when the Base Rate is determined by Xxxxx Fargo's "prime
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 fees and 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.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on Holdings and the Banks in the absence of manifest
error. The Agent will, at the request of Holdings or any Bank, deliver to
Holdings or the Bank, as the case may be, a statement showing the quotations
used by the Agent in determining any interest rate and the resulting interest
rate.
2.13 Payments by Holdings. (a) All payments to be made by Holdings shall
be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by Holdings 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 11:00 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 11:00 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.
(b) 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.
(c) Unless the Agent receives notice from Holdings prior to the date on
which any payment is due to the Banks that Holdings will not make such payment
in full as and when required, the Agent may assume that Holdings 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 Holdings 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,
38
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.
2.14 Payments by the Banks to the Agent. (a) Unless the Agent receives
notice from a Bank on or prior to the Effective Date or, with respect to any
Borrowing after the Effective Date, at least one Business Day prior to the date
of such Borrowing, that such Bank will not make available as and when required
hereunder to the Agent for the account of Holdings 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 Holdings 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 Holdings 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 Holdings of such failure to fund and, upon demand by
the Agent, Holdings 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.
(b) 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.
2.15 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.
Holdings 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 11.10) with respect to
such participation as fully as if such Bank were the direct creditor of Holdings
in the amount of such participation. The Agent will keep records (which shall be
conclusive and binding in the absence
39
of manifest error) of participations purchased under this Section and will in
each case notify the Banks following any such purchases or repayments.
2.16 Security and Guaranty. (a) All obligations of Holdings under this
Agreement, the Notes and all other Loan Documents shall be secured in accordance
with the Collateral Documents.
(b) All obligations of Holdings under this Agreement, each of the
Notes and all other Loan Documents to which it is a party shall be
unconditionally guaranteed by each Guarantor pursuant to its Guaranty.
ARTICLE III.
THE LETTERS OF CREDIT
3.01 The Letter of Credit Subfacility. (a) On the terms and conditions set
forth herein (i) the Issuing Bank agrees, (A) from time to time on any Business
Day during the period from the Effective Date to the Revolving Termination Date
to issue Letters of Credit for the account of Holdings, and to amend or renew
Letters of Credit previously issued by it, in accordance with subsections
3.02(c) and 3.02(d), and (B) to honor drafts under the Letters of Credit; and
(ii) the Banks severally agree to participate in Letters of Credit Issued for
the account of Holdings; provided that the Issuing Bank shall not be obligated
to Issue, and no Bank shall be obligated to participate in, any Letter of Credit
if such Letter of Credit is not denominated in Dollars or if as of the date of
Issuance of such Letter of Credit and after giving effect thereto (the "Issuance
Date") (1) the Effective Amount of all L/C Obligations plus the Effective Amount
of all Revolving Loans and Swingline Loans shall exceed an amount equal to the
lesser of (a) the combined Revolving Commitments and (b) the Borrowing Base, (2)
the participation of any Bank in the Effective Amount of all L/C Obligations and
in the Effective Amount of all Swingline Loans plus the Effective Amount of the
Revolving Loans of such Bank shall exceed such Bank's Revolving Commitment, or
(3) the Effective Amount of L/C Obligations shall exceed the L/C Commitment.
Within the foregoing limits, and subject to the other terms and conditions
hereof, Holdings ability to obtain Letters of Credit shall be fully revolving,
and, accordingly, Holdings may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit which have expired or which have been drawn
upon and reimbursed.
(b) The Issuing Bank is under no obligation to Issue any Letter of
Credit if:
(i) any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank
from Issuing such Letter of Credit, or any Requirement of Law applicable to the
Issuing Bank or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Bank
shall prohibit, or request that the Issuing Bank refrain from, the Issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Bank with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the Issuing Bank is not
otherwise compensated hereunder) not in effect on the Effective Date, or shall
impose upon the Issuing Bank any unreimbursed loss, cost or expense which was
40
not applicable on the Effective Date and which the Issuing Bank in good xxxxx
xxxxx material to it;
(ii) the Issuing Bank has received written notice from any Bank, the
Agent or Holdings, on or prior to the Business Day prior to the requested date
of Issuance of such Letter of Credit, that one or more of the applicable
conditions contained in Article V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (A) more
than 365 days after the date of Issuance, unless the Majority Banks have
approved such expiry date in writing, or (B) after the Revolving Termination
Date, unless all of the Banks have approved such expiry date in writing;
(iv) the expiry date of any requested Letter of Credit is prior to
the maturity date of any financial obligation to be supported by the requested
Letter of Credit;
(v) any requested Letter of Credit does not provide for drafts, or
is not otherwise in form and substance acceptable to the Issuing Bank, or the
Issuance of a Letter of Credit shall violate any applicable policies of the
Issuing Bank;
(vi) any Standby Letter of Credit is for the purpose of supporting
the issuance of any letter of credit by any other Person;
(vii) any Standby Letter of Credit is in a face amount less than
$1,000,000; or
(viii) any requested Letter of Credit is to be denominated in a
currency other than Dollars.
(c) Letters of Credit issued under this Article III shall be either
Commercial Letters of Credit or Standby Letters of Credit.
3.02 Issuance, Amendment and Renewal of Letters of Credit. (a) Each Letter
of Credit shall be issued upon the irrevocable written request of Holdings
received by the Issuing Bank (with a copy sent by Holdings to the Agent) at
least four Business Days (or such shorter time as the Issuing Bank may agree in
a particular instance in its sole discretion) prior to the proposed date of
issuance. Each such request for issuance of a Letter of Credit shall be by
facsimile, confirmed immediately in an original writing, in the form of an L/C
Application, and shall specify in form and detail satisfactory to the Issuing
Bank: (i) the proposed date of issuance of the Letter of Credit (which shall be
a Business Day); (ii) the face amount of the Letter of Credit; (iii) the expiry
date of the Letter of Credit; (iv) the name and address of the beneficiary
thereof; (v) the documents to be presented by the beneficiary of the Letter of
Credit in case of any drawing thereunder; (vi) the full text of any certificate
to be presented by the beneficiary in case of any drawing thereunder; and (vii)
such other matters as the Issuing Bank may require.
(b) At least two Business Days prior to the Issuance of any Letter
of Credit, the Issuing Bank will confirm with the Agent (by telephone or in
writing) that the Agent has received a copy of the L/C Application or L/C
Amendment Application from Holdings and, if not, the Issuing Bank will provide
the Agent with a copy thereof. Unless the Issuing Bank has
41
received notice on or before the Business Day immediately preceding the date the
Issuing Bank is to issue a requested Letter of Credit from the Agent (A)
directing the Issuing Bank not to issue such Letter of Credit because such
issuance is not then permitted under subsection 3.01(a) as a result of the
limitations set forth in clauses (1) through (3) thereof or subsection
3.01(b)(ii); or (B) that one or more conditions specified in Article V are not
then satisfied; then, subject to the terms and conditions hereof, the Issuing
Bank shall, on the requested date, issue a Letter of Credit for the account of
Holdings in accordance with the Issuing Bank's usual and customary business
practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Bank will, upon the written
request of Holdings received by the Issuing Bank (with a copy sent by Holdings
to the Agent) at least four Business Days (or such shorter time as the Issuing
Bank may agree in a particular instance in its sole discretion) prior to the
proposed date of amendment (including a renewal or extension thereof), amend any
Letter of Credit issued by it. Each such request for amendment of a Letter of
Credit shall be made by facsimile, confirmed immediately in an original writing,
made in the form of an L/C Amendment Application and shall specify in form and
detail satisfactory to the Issuing Bank: (i) the Letter of Credit to be amended;
(ii) the proposed date of amendment of the Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such other
matters as the Issuing Bank may require. The Issuing Bank shall be under no
obligation to amend any Letter of Credit if: (A) the Issuing Bank would have no
obligation at such time to issue such Letter of Credit in its amended form under
the terms of this Agreement; or (B) the beneficiary of any such Letter of Credit
does not accept the proposed amendment to the Letter of Credit. The Agent will
promptly notify the Banks of the Issuance of any Standby Letter of Credit
notified to it by the Issuing Bank. The Banks acknowledge and agree that the
Agent will not notify them of the receipt by the Agent of any L/C Application or
L/C Amendment Application or of the Issuance of any Commercial Letter of Credit.
From time to time the Agent will notify the Banks of the amount of all
outstanding Letters of Credit hereunder.
(d) The Issuing Bank and the Banks agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, the Issuing
Bank shall be entitled to authorize the renewal of any Letter of Credit issued
by it. The Issuing Bank shall be under no obligation so to renew any Letter of
Credit if: (A) the Issuing Bank would have no obligation at such time to issue
or amend such Letter of Credit in its renewed form under the terms of this
Agreement; or (B) the beneficiary of any such Letter of Credit does not accept
the proposed renewal of the Letter of Credit. If any outstanding Letter of
Credit shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the Issuing Bank that such Letter of
Credit shall not be renewed, and if at the time of renewal the Issuing Bank
would be entitled to authorize the renewal of such Letter of Credit in
accordance with this subsection 3.02(d) upon the request of Holdings but the
Issuing Bank shall not have received any written direction by Holdings with
respect thereto, the Issuing Bank shall nonetheless be permitted to allow such
Letter of Credit to renew, and Holdings and the Banks hereby authorize such
renewal, and, accordingly, the Issuing Bank shall be deemed to have received an
L/C Amendment Application from Holdings requesting such renewal.
42
(e) The Issuing Bank may, at its election (or as required by the
Agent at the direction of the Majority Banks), deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any time
and from time to time, in order to cause the expiry date of such Letter of
Credit to be a date not later than the Revolving Termination Date.
(f) This Agreement shall control in the event of any conflict with
any L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Bank will also deliver to the Agent, concurrently or
promptly following its delivery of a Letter of Credit, or amendment to or
renewal of a Letter of Credit, to an advising bank or a beneficiary, a true and
complete copy of each such Letter of Credit or amendment to or renewal of a
Letter of Credit.
3.03 Risk Participations, Drawings and Reimbursements. (a) Immediately
upon the Issuance of each Letter of Credit, each Bank shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from the Issuing Bank
a participation in such Letter of Credit and each drawing thereunder in an
amount equal to the product of (i) the Pro Rata Share of such Bank, times (ii)
the maximum amount available to be drawn under such Letter of Credit and the
amount of such drawing, respectively. Each Issuance of a Letter of Credit shall
be deemed to utilize the Commitment of each Bank by an amount equal to the
amount of such participation.
(b) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the Issuing Bank will promptly
notify Holdings and specify in such notice the date such drawing will be honored
by the Issuing Bank (the "Honor Date"). If the Issuing Bank so notifies Holdings
prior to 9:00 a.m. (San Francisco time) on the Honor Date, Holdings, as account
party under such Letter of Credit, shall reimburse the Issuing Bank no later
than 11:00 a.m. (San Francisco time) on the Honor Date for the amount paid by
the Issuing Bank under such Letter of Credit or, if the Issuing Bank shall so
notify Holdings after 9:00 a.m. (San Francisco time) on the Honor Date,
Holdings, as account party under such Letter of Credit, shall reimburse the
Issuing Bank no later than 11:00 a.m. (San Francisco time) on the next
succeeding Business Day for the amount paid by the Issuing Bank under such
Letter of Credit on the Honor Date (each such date, a "Reimbursement Date"), in
each case, in an amount equal to the amount so paid by the Issuing Bank. In the
event Holdings fails to reimburse the Issuing Bank for the full amount of any
drawing under any Letter of Credit by the required time as provided above on the
Reimbursement Date, the Issuing Bank will promptly notify the Agent, and the
Agent will promptly notify each Bank thereof (including the amount thereof and
such Bank's Pro Rata Share thereof), and Holdings shall be deemed to have
requested that Base Rate Loans be made by the Banks to Holdings to be disbursed
on the Reimbursement Date for such Letter of Credit, subject to the amount of
the unutilized portion of the Aggregate Commitment and subject to the conditions
set forth in Section 5.02. Holdings hereby directs that the proceeds of any such
Loans deemed to be made by it shall be used to pay its reimbursement obligations
in respect of any such drawing. Solely for the purposes of making such Loans,
the Minimum Amount limitations set forth in Section 2.03 shall not be
applicable. Any notice given by the Issuing Bank or the Agent pursuant to this
subsection 3.03(b) may be oral if immediately confirmed in writing (including by
facsimile); provided that the lack of such an immediate confirmation shall not
affect the conclusiveness or binding effect of such notice. In the event that
any amount of any
43
drawing under any Letter of Credit is not reimbursed by Holdings on the Honor
Date, such unreimbursed amount shall bear interest until it is either deemed to
be an L/C Borrowing as provided in subsection (f) or deemed to be converted to a
Base Rate Loan as provided in this subsection (b), at a rate per annum equal to
the Base Rate plus the Applicable Margin then in effect for Base Rate Loans.
(c) Each Bank shall upon receipt of any notice pursuant to
subsection 3.03(b) make available to the Agent for the account of the Issuing
Bank an amount in Dollars and in immediately available funds equal to its Pro
Rata Share of the amount of the drawing, whereupon such Bank shall (subject to
subsection 3.03(f)) be deemed to have made a Revolving Loan consisting of a Base
Rate Loan to Holdings in that amount. The Agent will promptly give notice of the
occurrence of the Reimbursement Date, but failure of the Agent to give any such
notice on the Reimbursement Date or in sufficient time to enable any Bank to
effect such payment on such date shall not relieve such Bank from its
obligations under this Section 3.03.
(d) With respect to any unreimbursed drawing that is not converted
into Revolving Loans in whole or in part, because of Holdings' failure to
satisfy the conditions set forth in Section 5.02 or for any other reason,
Holdings shall be deemed to have incurred from the Issuing Bank an L/C Borrowing
in the amount of such drawing, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at a rate per annum
equal to the Base Rate, plus the Applicable Margin then in effect for Base Rate
Loans, plus 2% per annum. In such event, each Bank shall upon receipt of any
notice pursuant to subsection 3.03(b) make available to the Agent for the
account of the Issuing Bank an amount in Dollars and in immediately available
funds equal to its Pro Rata Share of the amount of the drawing. Each Bank's
payment to the Issuing Bank pursuant to this subsection 3.03(d) shall be deemed
payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Bank in satisfaction of its participation
obligation under this Section 3.03.
(e) If any Bank fails to make available to the Agent for the account
of the Issuing Bank the amount of such Bank's Pro Rata Share of the amount of
any drawing by no later than 12:00 noon (San Francisco time) on the
Reimbursement Date, then interest shall accrue on such Bank's obligation to make
such payment, from the Reimbursement Date to the date such Bank makes such
payment, at (i) the Federal Funds Rate in effect from time to time during the
period commencing on the Reimbursement Date and ending on the date three
Business Days thereafter, and (ii) thereafter at the Base Rate as in effect from
time to time, payable on demand of the Agent.
(f) Each Bank's obligation in accordance with this Agreement to make
or participate in the Revolving Loans or L/C Advances, as contemplated by this
Section 3.03, as a result of a drawing under a Letter of Credit, shall be
absolute and unconditional and without recourse to the Issuing Bank and shall
not be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Bank may have against the Issuing
Bank, Holdings or any other Person for any reason whatsoever; (ii) the
occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided, however, that each
Bank's obligation to make Revolving Loans under this Section 3.03 is subject to
the conditions set forth in Section 5.02.
44
3.04 Repayment of Participations. (a) Upon (and only upon) receipt by the
Agent for the account of the Issuing Bank of immediately available funds from
Holdings (i) in reimbursement of any payment made by the Issuing Bank under the
Letter of Credit with respect to which any Bank has paid the Agent for the
account of the Issuing Bank for such Bank's participation in the Letter of
Credit pursuant to Section 3.03 or (ii) in payment of interest thereon, the
Agent will pay to each Bank, in the same funds as those received by the Agent
for the account of the Issuing Bank, the amount of such Bank's Pro Rata Share of
such funds, and the Issuing Bank shall receive the amount of the Pro Rata Share
of such funds of any Bank that did not so pay the Agent for the account of the
Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any time to
return to Holdings, or to a trustee, receiver, liquidator, custodian, or any
official in any Insolvency Proceeding, any portion of the payments made by
Holdings to the Agent for the account of the Issuing Bank pursuant to subsection
3.04(a) in reimbursement of a payment made under the Letter of Credit or
interest or fee thereon, each Bank shall, on demand of the Agent, forthwith
return to the Agent or the Issuing Bank the amount of its Pro Rata Share of any
amounts so returned by the Agent or the Issuing Bank plus interest thereon from
the date such demand is made to the date such amounts are returned by such Bank
to the Agent or the Issuing Bank, at a rate per annum equal to the Federal Funds
Rate in effect from time to time.
3.05 Role of the Issuing Bank. (a) Each Bank and Holdings agree that, in
paying any drawing under a Letter of Credit, the Issuing Bank shall not have any
responsibility to obtain any document (other than any sight draft and
certificates expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document.
(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be liable to
any Bank for: (i) any action taken or omitted in connection herewith at the
request or with the approval of the Banks (including the Majority Banks, as
applicable); (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
(c) Holdings hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not,
preclude Holdings pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. No Agent-Related
Person, nor any of the respective correspondents, participants or assignees of
the Issuing Bank, shall be liable or responsible for any of the matters
described in clauses (i) through (vii) of Section 3.06; provided, however,
anything in such clauses to the contrary notwithstanding, that Holdings may have
a claim against the Issuing Bank, and the Issuing Bank may be liable to
Holdings, to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by Holdings which Holdings proves
were caused by the Issuing Bank's willful misconduct or gross negligence or the
Issuing Bank's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing: (i) the Issuing Bank may
accept
45
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary;
and (ii) the Issuing Bank shall not be responsible for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign a Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason.
3.06 Obligations Absolute. The obligations of Holdings under this
Agreement and any L/C-Related Document to reimburse the Issuing Bank for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Revolving Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(i) any lack of validity or enforceability of this Agreement or any
L/C-Related Document;
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the obligations of Holdings in respect of any
Letter of Credit or any other amendment or waiver of or any consent to departure
from all or any of the L/C-Related Documents;
(iii) the existence of any claim, set-off, defense or other right
that Holdings may have at any time against any beneficiary or any transferee of
any Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the Issuing Bank or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by the
L/C-Related Documents or any unrelated transaction;
(iv) any draft, demand, certificate or other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; or any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit;
(v) any payment by the Issuing Bank under any Letter of Credit
against presentation of a draft or certificate that does not strictly comply
with the terms of any Letter of Credit; or any payment made by the Issuing Bank
under any Letter of Credit to any Person purporting to be a trustee in
bankruptcy, debtor-in-possession, assignee for the benefit of creditors,
liquidator, receiver or other representative of or successor to any beneficiary
or any transferee of any Letter of Credit, including any arising in connection
with any Insolvency Proceeding;
(vi) any exchange, release or non-perfection of any collateral, or
any release or amendment or waiver of or consent to departure from any other
guarantee, for all or any of the obligations of Holdings in respect of any
Letter of Credit; or
46
(vii) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that might
otherwise constitute a defense available to, or a discharge of, Holdings or a
guarantor.
3.07 Cash Collateral Pledge. (i) Upon the request of the Agent, if the
Issuing Bank has honored any full or partial drawing request on any Letter of
Credit and such drawing has resulted in an L/C Borrowing hereunder, or (ii) if,
as of the Revolving Termination Date, any Letters of Credit may for any reason
remain outstanding and partially or wholly undrawn, or (iii) the occurrence of
the circumstances described in subsection 2.08(b) or 2.08(c) requiring Holdings
to Cash Collateralize Letters of Credit, then, Holdings shall immediately Cash
Collateralize the L/C Obligations in an amount equal to such L/C Obligations.
Holdings shall, to the extent necessary, make such additional pledges from time
to time as shall be necessary to ensure that all L/C Obligations remain at all
times fully cash collateralized. Cash collateral held under this Section 3.07 or
Section 9.02 shall be maintained in blocked, non-interest bearing deposit
accounts at Xxxxx Fargo pursuant to the Security Agreement.
3.08 Letter of Credit Fees. (a) Holdings shall pay to the Agent for the
account of each of the Banks in accordance with its Pro Rata Share a letter of
credit fee with respect to the Standby Letters of Credit equal to the rate per
annum equal to the Applicable Fee Amount of the actual daily maximum amount
available to be drawn of the outstanding Standby Letters of Credit, computed on
a quarterly basis in arrears on the last Business Day of each calendar quarter
based upon Standby Letters of Credit outstanding for that quarter as calculated
by the Agent. Such letter of credit fees shall be due and payable quarterly in
arrears on the last Business Day of each calendar quarter during which Standby
Letters of Credit are outstanding, commencing on the first such quarterly date
to occur after the Effective Date, to the Revolving Termination Date (or such
later date upon which the outstanding Letters of Credit shall expire), with the
final payment to be made on the Revolving Termination Date (or such later
expiration date).
(b) Holdings shall pay to the Issuing Bank, for the Issuing Bank's
sole account, a letter of credit fee with respect to the amount from time to
time available to be drawn under Commercial Letters of Credit in such amount and
on such dates as shall separately be agreed between the Issuing Bank and
Holdings.
(c) Holdings shall pay to the Issuing Bank, for the Issuing Bank's
sole account, a letter of credit fronting fee for each Standby Letter of Credit
Issued by the Issuing Bank equal to 0.125% per annum of the actual daily maximum
amount available to be drawn of the outstanding Standby Letters of Credit,
computed on a quarterly basis in arrears on the last Business Day of each
calendar quarter based upon Standby Letters of Credit outstanding for that
quarter as calculated by the Issuing Bank. Such letter of credit fronting fees
shall be due and payable quarterly in arrears on the last Business Day of each
calendar quarter during which Standby Letters of Credit are outstanding,
commencing on the first such quarterly date to occur after the Effective Date,
to the Revolving Termination Date (or such later date upon which the outstanding
Letters of Credit shall expire), with the final payment to be made on the
Revolving Termination Date (or such later expiration date).
47
(d) Holdings shall pay to the Issuing Bank from time to time on
demand the normal issuance, presentation, amendment and other processing fees,
and other standard costs and charges, of the Issuing Bank relating to letters of
credit as from time to time in effect.
(e) Notwithstanding subsection (a) of this Section, while any Event
of Default exists or after acceleration, Holdings shall pay a letter of credit
fee (after as well as before entry of judgment thereon to the extent permitted
by law) on the actual daily maximum amount available to be drawn of the
outstanding Letters of Credit, at a rate per annum which is determined by adding
2% per annum to the rate otherwise then in effect hereunder for such Letters of
Credit.
3.09 Applicability of Uniform Customs and Practice and ISP 98. Unless
otherwise expressly agreed by the Issuing Bank and Holdings when a Letter of
Credit is issued and subject to applicable laws, performance under Letters of
Credit by the Issuing Bank, its correspondents, and beneficiaries will be
governed by (i) with respect to Standby Letters of Credit, the rules of the
"International Standby Practices 1998" (ISP98) or such later revision as may be
published by the Institute of International Banking Law & Practice on any date
any Standby Letter of Credit may be issued, and (ii) with respect to Commercial
Letters of Credit, the rules of the Uniform Customs and Practice for Documentary
Credits, as published in its most recent version by the International Chamber of
Commerce (the "ICC") on the date any Commercial Letter of Credit is issued.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.01 Taxes. (a) Any and all payments by Holdings to each Bank or the Agent
under this Agreement and any other Loan Document shall be made free and clear
of, and without deduction or withholding for, any Taxes. In addition, Holdings
shall pay all Other Taxes.
(b) If Holdings shall be required by law to deduct or withhold any
Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Bank or the Agent, then:
(i) the sum payable shall be increased as necessary so that, after
making all required deductions and withholdings (including deductions and
withholdings applicable to additional sums payable under this Section), such
Bank or the Agent, as the case may be, receives and retains an amount equal to
the sum it would have received and retained had no such deductions or
withholdings been made;
(ii) Holdings shall make such deductions and withholdings;
(iii) Holdings shall pay the full amount deducted or withheld to the
relevant taxing authority or other authority in accordance with applicable law;
and
(iv) Holdings shall also pay to each Bank or the Agent for the
account of such Bank, at the time interest is paid, Further Taxes in the amount
that the respective Bank specifies
48
as necessary to preserve the after-tax yield such Bank would have received if
such Taxes, Other Taxes or Further Taxes had not been imposed.
(c) Holdings agrees to indemnify and hold harmless each Bank and the
Agent for the full amount of (i) Taxes, (ii) Other Taxes, and (iii) Further
Taxes in the amount that the respective Bank specifies as necessary to preserve
the after-tax yield such Bank would have received if such Taxes, Other Taxes or
Further Taxes had not been imposed, and any liability (including penalties,
interest, additions to tax and expenses) arising therefrom or with respect
thereto, whether or not such Taxes, Other Taxes or Further Taxes were correctly
or legally asserted. Payment under this indemnification shall be made within 30
days after the date such Bank or the Agent makes written demand therefor.
(d) Within 30 days after the date of any payment by Holdings of
Taxes, Other Taxes or Further Taxes, Holdings shall furnish to each Bank or the
Agent the original or a certified copy of a receipt evidencing payment thereof,
or other evidence of payment satisfactory to such Bank or the Agent.
(e) If Holdings is required to pay any amount to any Bank or the
Agent pursuant to subsection (b) or (c) of this Section, then such Bank shall
use reasonable efforts (consistent with legal and regulatory restrictions) to
change the jurisdiction of its Lending Office so as to eliminate any such
additional payment by Holdings which may thereafter accrue, if such change in
the sole judgment of such Bank is not otherwise disadvantageous to such Bank.
(f) Nothing contained in this Section 4.01 shall override any term
or provision of any Specified Swap Contract regarding withholding taxes relating
to Swap Contracts.
4.02 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 such Bank to Holdings through
the Agent, any obligation of that Bank to make Offshore Rate Loans shall be
suspended until such Bank notifies the Agent and Holdings that the circumstances
giving rise to such determination no longer exist.
(b) If a Bank determines that it is unlawful to maintain any
Offshore Rate Loan, Holdings 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 4.04, either on the last day of the Interest
Period thereof, if such Bank may lawfully continue to maintain such Offshore
Rate Loans to such day, or immediately, if such Bank may not lawfully continue
to maintain such Offshore Rate Loan. If Holdings is required to so prepay any
Offshore Rate Loan, then concurrently with such prepayment, Holdings shall
borrow from the affected Bank, in the amount of such repayment, a Base Rate
Loan.
(c) If the obligation of any Bank to make or maintain Offshore Rate
Loans has been so terminated or suspended, Holdings may elect, by giving notice
to such Bank through the
49
Agent that all Loans which would otherwise be made by such Bank as Offshore Rate
Loans shall be instead Base Rate Loans.
(d) 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 such Bank, be
illegal or otherwise disadvantageous to such Bank.
4.03 Increased Costs and Reduction of Return. (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) 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 or
participating in Letters of Credit, or, in the case of the Issuing Bank, any
increase in the cost to the Issuing Bank of agreeing to issue, issuing or
maintaining any Letter of Credit or of agreeing to make or making, funding or
maintaining any unpaid drawing under any Letter of Credit, then Holdings 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.
(b) 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
such Bank (or its Lending Office) or any corporation controlling such Bank with
any Capital Adequacy Regulation, affects or would affect the amount of capital
required or expected to be maintained by such Bank or any corporation
controlling such 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 demand of such Bank to Holdings through the Agent,
Holdings shall pay to such Bank, from time to time as specified by such Bank,
additional amounts sufficient to compensate such Bank for such increase.
4.04 Funding Losses. Holdings shall reimburse each Bank and hold each Bank
harmless from any loss or expense which such Bank may sustain or incur as a
consequence of:
(a) the failure of Holdings to make on a timely basis any payment of
principal of any Offshore Rate Loan;
(b) the failure of Holdings to borrow, continue or convert a Loan
after Holdings has given (or is deemed to have given) a Notice of Borrowing or a
Notice of Conversion/ Continuation;
50
(c) the failure of Holdings to make any prepayment in accordance
with any notice delivered under Section 2.05, 2.07 or 2.08;
(d) the prepayment (including pursuant to Section 2.05, 2.07, 2.08
or 4.02(b)) or other payment (including after acceleration thereof) of an
Offshore Rate Loan on a day that is not the last day of the relevant Interest
Period; and
(e) the conversion under Section 2.04 of any Offshore Rate Loan to a
Base Rate Loan on a day that is not the last day of the relevant Interest
Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by Holdings to the Banks under this Section and
under subsection 4.03(a), each Offshore Rate Loan made by a Bank (and each
related reserve, special deposit or similar requirement) shall be conclusively
deemed to have been funded at the LIBOR used in determining the Offshore Rate
for such Offshore Rate Loan by a matching deposit or other borrowing in the
London interbank eurodollar market for a comparable amount and for a comparable
period, whether or not such Offshore Rate Loan is in fact so funded.
4.05 Inability to Determine Rates. If the Agent or 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 Borrowing of Offshore Rate Loans or conversion or continuation of
Offshore Rate Loans, or that the Offshore Rate applicable pursuant to subsection
2.10(a) for any requested Interest Period with respect to a proposed Borrowing
of Offshore Rate Loans, or a conversion into or continuation of Offshore Rate
Loans does not adequately and fairly reflect the cost to such Banks of funding
such Loans, the Agent will promptly so notify Holdings 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, Holdings may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If Holdings does not revoke such
Notice, the Banks shall make, convert or continue the Loans, as proposed by
Holdings, in the amount specified in the applicable notice submitted by
Holdings, but such Loans shall be made, converted or continued as Base Rate
Loans instead of Offshore Rate Loans, as the case may be.
4.06 Certificates of Banks. Any Bank claiming reimbursement or
compensation under this Article IV shall deliver to Holdings (with a copy to the
Agent) a certificate setting forth in reasonable detail the amount payable to
such Bank hereunder, and the basis for calculation of such amount, and such
certificate shall be conclusive and binding on Holdings in the absence of
manifest error.
4.07 Substitution of Banks. Upon the receipt by Holdings from any Bank (an
"Affected Bank") of a claim for compensation under Section 4.03, Holdings may:
(i) request one or more of the other Banks to acquire and assume all of such
Affected Bank's Loans and Commitment; or (ii) designate a replacement lending
institution (which shall be an Eligible Assignee) to acquire and assume all of
such Affected Bank's Loans and Commitment (a
51
"Replacement Bank"); provided, however, that Holdings shall be liable for the
payment upon demand of all costs and other amounts arising under Section 4.04
that result from the acquisition of any Affected Bank's Loan and/or Commitment
(or any portion thereof) by a Bank or Replacement Bank, as the case may be, on a
date other than the last day of the applicable Interest Period with respect to
any Offshore Rate Loan then outstanding. Any such designation of a Replacement
Bank under clause (ii) shall be effected in accordance with, and subject to the
terms and conditions of, the assignment provisions contained in Section 11.08,
and shall in any event be subject to the prior written consent of the Agent, the
Issuing Bank and the Swingline Bank (which consent shall not be unreasonably
withheld).
4.08 Survival. The agreements and obligations of Holdings in this Article
IV shall survive the termination of the Commitments, the termination or
expiration of all Letters of Credit and the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
5.01 Conditions to the Effective Date. The effectiveness of this Agreement
and the obligations of each Bank to become a party hereto (and of any New Bank
to advance its Pro Rata Share of any Loans currently outstanding under the
Original Credit Agreement pursuant to Section 2.01 hereof) and to make the New
Term Loans shall be subject to the condition that the Agent shall have received
on or before the Effective Date all of the following, in form and substance
reasonably satisfactory to the Agent and each Bank, and in sufficient copies for
each Bank:
(a) Credit Agreement and Notes. This Agreement executed by each
party hereto and Notes executed by Holdings for the Banks requesting Notes;
(b) Resignation, Assignment and Acceptance Agreement. The
Resignation, Assignment and Acceptance Agreement executed by the parties
thereto;
(c) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors of each Loan
Party authorizing the transactions contemplated hereby, certified as of the
Effective Date by the Secretary or an Assistant Secretary of such Person; and
(ii) a certificate of the Secretary or Assistant Secretary of each
Loan Party, dated as of the Effective Date, certifying the names, titles and
true signatures of the officers of such Person authorized to execute, deliver
and perform, as applicable, this Agreement and all other Loan Documents to be
delivered by it hereunder;
(d) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the bylaws of
each Loan Party as in effect on the Effective Date, certified by the Secretary
or Assistant Secretary of such Person as of the Effective Date; and
52
(ii) a good standing certificate, as of a recent date, for each Loan
Party from the Secretary of State (or similar, applicable Governmental
Authority) of its state of incorporation and each state where its ownership,
lease or operation of property or the conduct of its business requires such Loan
Party be qualified or otherwise licensed to do business;
(e) Legal Opinion. An opinion of Xxxxxx, Xxxx & Xxxxxxxx LLP,
counsel to the Loan Parties and addressed to the Agent and the Banks, dated the
Effective Date, substantially in the form of Exhibit D;
(f) Payment of Fees. Evidence of payment by Holdings of all accrued
and unpaid fees, costs and expenses to the extent then due and payable on the
Effective Date, together with reasonable Attorney Costs of Xxxxx Fargo to the
extent invoiced prior to or on the Effective Date, plus such additional amounts
of reasonable Attorney Costs as shall constitute Xxxxx Fargo's reasonable
estimate of Attorney Costs incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter preclude final
settling of accounts between Holdings and Xxxxx Fargo); including any such
costs, fees and expenses arising under or referenced in Sections 2.11 and 11.04;
(g) Officer's Certificate. A certificate signed by a Responsible
Officer of each of Holdings and the Company, dated as of the Effective Date,
stating that:
(i) the representations and warranties contained in Article VI are
true and correct on and as of such date, as though made on and as of such date;
(ii) no Default or Event of Default exists or would result from the
initial Credit Extension; and
(iii) there has occurred since December 31, 2000, no event or
circumstance that has resulted or could reasonably be expected to result in a
Material Adverse Effect;
(h) Financial Statements.
(i) The audited consolidated balance sheet of Holdings and its
Subsidiaries as at December 31, 1998, December 31, 1999 and December 31, 2000,
and the related consolidated statements of income or operations, shareholders'
equity and cash flows for the fiscal year then ended, certified by a Responsible
Officer of the Company;
(ii) the unaudited consolidated balance sheet of Holdings and its
Subsidiaries as at June 30, 2001, and the related consolidated statements of
income or operations, shareholders' equity and cash flows for the fiscal quarter
then ended, certified by a Responsible Officer of the Company; and
(iii) such other financial information as the Agent or any Bank may
reasonably request;
(i) Borrowing Base Certificate. A completed Borrowing Base
Certificate, certifying the Borrowing Base as of the month ended June 30, 2001,
signed by a Responsible Officer of Holdings, and dated the Effective Date;
53
(j) Collateral Documents. The Collateral Documents, executed by each
Loan Party, in appropriate form for recording, where necessary, together with:
(i) copies of all UCC-l, UCC-2 and UCC-3 financing statements to be
filed to perfect or amend the security interests of the Agent for the benefit of
the Banks, or other evidence satisfactory to the Agent that there have been
filed, registered or recorded all financing statements and other filings,
registrations and recordings necessary and advisable to perfect or amend the
perfection of the Liens of the Agent for the benefit of the Banks in accordance
with applicable law, or, with respect to the Mortgaged Property, evidence
satisfactory to the Agent that the executed Mortgages with respect to the
Mortgaged Property shall have been delivered to Chicago Title Insurance Company
in recordable form on or prior to the Effective Date for recording;
(ii) written advice relating to such Lien and judgment searches as
the Agent shall have requested, and such termination statements or other
documents as may be necessary to confirm that the Collateral is subject to no
other Liens in favor of any Persons (other than Permitted Liens);
(iii) receipt by the Agent from the Original Agent of all
certificates and instruments representing the Pledged Collateral, together with
stock transfer powers executed in blank with signatures guaranteed as the Agent
may specify;
(iv) funds sufficient to pay any filing or recording tax or fee in
connection with any and all UCC-1 financing statements and the Mortgages;
(v) with respect to the Mortgaged Property, an A.L.T.A. Form B (or
other form acceptable to the Agent and the Banks) mortgagee policy of title
insurance or a binder issued by a title insurance company satisfactory to the
Agent and the Banks insuring (or undertaking to insure, in the case of a binder)
that each Mortgage creates and constitutes a valid first Lien against the
Mortgaged Property contemplated thereby in favor of the Agent, subject only to
exceptions acceptable to the Agent and the Banks, with such endorsements and
affirmative insurance as the Agent or any Bank may reasonably request;
(vi) to the extent not previously delivered pursuant to the Original
Credit Agreement, surveys and surveyor's certification as to all real property
and all land covered by a lease in respect of which there is delivered a
Mortgage, or as may be reasonably required by the Agent, each in form and
substance satisfactory to the Agent and the Banks, provided, however, that the
surveys of the properties located in Frisco, Texas and Glendale, Arizona shall
be delivered no later than sixty (60) days after the Effective Date;
(vii) to the extent not previously delivered pursuant to the
Original Credit Agreement, appraisals, in form and substance satisfactory to the
Agent and the Majority Banks, of certain real property Collateral, provided,
however, that the appraisals of the properties located in Frisco, Texas and
Glendale, Arizona shall be delivered no later than sixty (60) days after the
Effective Date;
(viii) proof of payment of all title insurance premiums, documentary
stamp or intangible taxes, recording fees and mortgage taxes payable in
connection with the recording of
54
any Mortgage or the issuance of the title insurance policies (whether due on the
Effective Date or in the future) including sums due in connection with any
future advances;
(ix) to the extent not previously delivered pursuant to the Original
Credit Agreement, such consents, estoppels, subordination agreements and other
documents and instruments executed by landlords, tenants and other Persons party
to material contracts relating to any Collateral as to which the Agent shall be
granted a Lien for the benefit of the Banks, as requested by the Agent or any
Bank; and
(x) evidence that all other actions necessary or, in the reasonable
opinion of the Agent or the Banks, desirable to perfect and protect the first
priority Lien created by the Collateral Documents, and to enhance the Agent's
ability to preserve and protect its interests in and access to the Collateral;
(k) Insurance Policies. Evidence that the Agent has been named as
loss payee under all policies of casualty insurance under a Form 438FBFU or
other standard lender's loss payable endorsement, and as additional insured
under all policies of liability insurance, required in accordance with Section
7.06 and the Collateral Documents, together with a certificate of insurance as
to all insurance coverage on the properties of Holdings and its Subsidiaries;
(l) Compliance Certificate. A completed Compliance Certificate, as
of June 30, 2001, signed by a Responsible Officer of Holdings, and dated the
Effective Date;
(m) Original Credit Agreement. Evidence that: (i) all amounts due
under the Original Credit Agreement to the Replaced Banks have been paid in
full; (ii) neither Holdings nor any Guarantor is obligated with respect to any
outstanding Letters of Credit thereunder; and (iii) all commitments of the
Replaced Banks under the Original Credit Agreement have been terminated as of
the Effective Date;
(n) First Amendment to Deeds of Trust. The First Amendment to Deeds
of Trust executed by each party thereto pursuant to which the Agent shall be
appointed substitute named beneficiary under all Mortgages and the Mortgages
shall be amended as provided therein;
(o) Control Agreements. Any control agreements for the perfection of
deposit accounts of Holdings and the Guarantors party hereto which have been
requested by the Agent prior to the Effective Date shall have been executed by
Holdings or such Guarantor, as applicable, and any applicable financial
institutions;
(p) Assignments of Trademarks. Such assignment documents as are
necessary such that that the Original Agent's rights as secured party with
respect to any trademarks of Holdings or any Guarantor party hereto have been
assigned to the Agent shall have been executed.
(q) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may reasonably request.
5.02 Conditions to the Subsequent Effective Date. The obligations of each
Additional Bank to become a party hereto and of each Additional Bank to make the
Additional Term Loans
55
and provide the Additional Revolving Commitment shall be subject to the
condition that the Agent shall have received on or before the Subsequent
Effective Date all of the following, in form and substance reasonably
satisfactory to the Agent and each Additional Bank, and in sufficient copies for
each Additional Bank:
(a) Credit Agreement and Notes. This Agreement executed by each
Additional Bank and Notes executed by Holdings for each Additional Bank
requesting Notes;
(b) Secretary's Certificate. A certificate of the Secretary or
Assistant Secretary of each Loan Party, dated as of the Subsequent Effective
Date, certifying:
(i) that the resolutions of the board of directors of each Loan
Party authorizing the transactions contemplated hereby, as delivered on the
Effective Date, are in full force and effect and have not been amended,
supplemented or modified; and
(ii) the names, titles and true signatures of the officers of such
Person authorized to execute, deliver and perform, as applicable, this Agreement
and all other Loan Documents to be delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the following
documents:
(i) the articles or certificate of incorporation and the bylaws of
each Loan Party as in effect on the Subsequent Effective Date, certified by the
Secretary or Assistant Secretary of such Person as of the Subsequent Effective
Date; and
(ii) a good standing certificate, as of a date reasonably prior to
the Subsequent Effective Date as is determined by the Agent in good faith, for
each Loan Party from the Secretary of State (or similar, applicable Governmental
Authority) of its state of incorporation and each state where its ownership,
lease or operation of property or the conduct of its business requires such Loan
Party be qualified or otherwise licensed to do business;
(d) Payment of Fees. Evidence of payment by Holdings of all accrued
and unpaid fees, costs and expenses to the extent then due and payable on the
Subsequent Effective Date, together with reasonable Attorney Costs of Xxxxx
Fargo to the extent invoiced prior to or on the Subsequent Effective Date, plus
such additional amounts of reasonable Attorney Costs as shall constitute Xxxxx
Fargo's reasonable estimate of Attorney Costs incurred or to be incurred by it
through the closing proceedings (provided that such estimate shall not
thereafter preclude final settling of accounts between Holdings and Xxxxx
Fargo); including any such costs, fees and expenses arising under or referenced
in Sections 2.11 and 11.04;
(e) Officer's Certificate. A certificate signed by a Responsible
Officer of each of Holdings and the Company, dated as of the Subsequent
Effective Date, stating that:
(i) the representations and warranties contained in Article VI are
true and correct on and as of such date, as though made on and as of such date;
(ii) no Default or Event of Default exists or would result from the
Credit Extensions to be made as of the Subsequent Effective Date; and
56
(iii) there has occurred since the Effective Date, no event or
circumstance that has resulted or could reasonably be expected to result in a
Material Adverse Effect; and
(f) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Additional Bank may reasonably request.
5.03 Conditions to All Credit Extensions. The obligation of each Bank and
the Swingline Bank to make any Credit Extension (including its initial Credit
Extension) and the obligation of the Issuing Bank to Issue any Letter of Credit
(including the initial Letter of Credit) shall be subject to the satisfaction of
the following conditions precedent on the relevant Borrowing Date or Issuance
Date:
(a) Notice, Application. The Agent shall have received a Notice of
Borrowing or in the case of any Issuance of any Letter of Credit, the Issuing
Bank and the Agent shall have received an L/C Application or L/C Amendment
Application, as required under Section 3.02;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on and as
of such Borrowing Date or Issuance Date with the same effect as if made on and
as of such Borrowing Date or Issuance 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 except that this
subsection (b) shall be deemed instead to refer to the last day of the most
recent quarter and year for which financial statements have then been delivered
in respect of the representation and warranty made in subsection 6.11(a));
(c) No Existing Default. No Default or Event of Default shall exist
or shall result from such Borrowing or Issuance;
(d) No Material Adverse Effect. There has occurred since December
31, 2000, no event or circumstance that has resulted or could reasonably be
expected to result in a Material Adverse Effect; and
(e) Borrowing Base. On any such Borrowing Date or Issuance Date, the
Agent shall be in receipt of the completed Borrowing Base Certificate then
required to be delivered by Holdings hereunder, and the Effective Amount of all
outstanding Revolving Loans and Swingline Loans and the Effective Amount of all
L/C Obligations shall not exceed an amount equal to the lesser of (A) the
Aggregate Commitment and (B) the Borrowing Base.
(f) No Future Advance Notice. Neither the Agent nor any Bank shall
have received from Holdings or any other Person any notice that any Collateral
Document will no longer secure on a first priority basis future advances or
future Loans to be made or extended under this Agreement.
Each Notice of Borrowing and L/C Application or L/C Amendment Application
submitted by Holdings hereunder shall constitute a representation and warranty
by Holdings hereunder, as of the date of each such notice and as of each
Borrowing Date or Issuance Date, as applicable, that (i) the conditions in this
Section 5.02 are satisfied, and (ii) the statements contained in the most recent
Borrowing Base Certificate, if any, delivered by Holdings hereunder shall be
true, correct
57
and complete on and as of the date of such Borrowing Date or Issuance Date, as
applicable, as though made on and as of such date, except for changes in the
information set forth in such Borrowing Base Certificate in the ordinary course
of business.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Each of Holdings and the Company represents and warrants to the Agent and
each Bank that:
6.01 Corporate Existence and Power. Holdings and each of its Subsidiaries:
(a) is a corporation, limited liability company or partnership duly
organized or formed, as the case may be, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals (i) to own its assets and carry on its
business and (ii) in the case of any Loan Party, to execute, deliver, and
perform its obligations under the Loan Documents;
(c) is duly qualified, 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, license or good standing;
and
(d) is in compliance with all Requirements of Law;
except, in each case referred to in clauses (b)(i) or (c) of this Section 6.01,
to the extent that the failure to do so would not reasonably be expected to have
a Material Adverse Effect.
6.02 Corporate Authorization; No Contravention. The execution, delivery
and performance by each Loan Party of this Agreement and each other Loan
Document to which such Loan Party is party, have been duly authorized by all
necessary corporate action, and do not and will not:
(a) contravene the terms of any of that Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which such Person is a party or any order, injunction, writ or
decree of any Governmental Authority to which such Person or its property is
subject; or
(c) violate any Requirement of Law.
6.03 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (except for recordings or filings in connection with the
Liens granted to the Agent under the Collateral Documents) is
58
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, any Loan Party of this Agreement or any other Loan
Document.
6.04 Binding Effect. This Agreement and each other Loan Document to which
any Loan Party is a party constitute the legal, valid and binding obligations of
such Loan Party, enforceable against any Loan Party 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.
6.05 Litigation. Except as specifically disclosed in Schedule 6.05, there
are no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of Holdings and the Company, threatened or contemplated, at law, in
equity, in arbitration or before any Governmental Authority, against Holdings,
or its Subsidiaries or any of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) are reasonably likely to result in an adverse result for
Holdings or its Subsidiaries, which adverse result would reasonably be expected
to have a Material Adverse Effect. No injunction, writ, temporary restraining
order or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution, delivery
or performance of this Agreement or any other Loan Document, or directing that
the transactions provided for herein or therein not be consummated as herein or
therein provided.
6.06 No Defaults. No Default or Event of Default exists or would result
from the incurring of any Obligations by any Loan Party or from the grant or
perfection of the Liens of the Agent and the Banks on the Collateral. Neither
Holdings nor any Subsidiary is in default under or with respect to any
Contractual Obligation in any respect which, individually or together with all
such defaults, could reasonably be expected to have a Material Adverse Effect,
or that would create an Event of Default under subsection 9.01(e).
6.07 ERISA Compliance. Except as specifically disclosed in Schedule 6.07:
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of
Holdings and the Company, nothing has occurred which would cause the loss of
such qualification. Holdings, the Company and each ERISA Affiliate have made all
required contributions to any Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect
59
to any Plan which has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
Holdings nor any ERISA Affiliate has incurred, or reasonably expects to incur,
any liability under Title IV of ERISA with respect
to any Pension Plan (other than premiums due and not delinquent under Section
4007 of ERISA); (iv) neither Holdings nor any ERISA Affiliate has incurred, or
reasonably expects to incur, 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; and (v) neither Holdings nor any ERISA Affiliate has engaged in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
6.08 Use of Proceeds; Margin Regulations. The proceeds of the Loans
and the Letters of Credit are to be used solely for the purposes set forth in
and permitted by Section 7.12 and Section 8.07. No Loan Party is generally
engaged in the business of purchasing or selling Margin Stock or extending
credit for the purpose of purchasing or carrying Margin Stock.
6.09 Title to Properties; Liens. Holdings and each Subsidiary have good
record and marketable title in fee simple to, or valid leasehold interests in,
all real property necessary or used in the ordinary conduct of their respective
businesses, except for such defects in title as could not, individually or in
the aggregate, have a Material Adverse Effect. The property of Holdings and its
Subsidiaries is subject to no Liens, other than Permitted Liens.
6.10 Taxes. Holdings 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 otherwise due
and payable, except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP. There is no proposed tax assessment against Holdings or any
Subsidiary that would, if made, have a Material Adverse Effect.
6.11 Financial Condition. (a) The audited consolidated balance sheet of
Holdings and its Subsidiaries dated December 31, 2000, the unaudited balance
sheet of Holdings and its Subsidiaries for the fiscal quarter ended June 30,
2001 and the related consolidated statements of income or operations and cash
flows for the fiscal period ended on that date:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein, subject to ordinary, good faith year end audit adjustments in the case
of quarterly financial statements;
(ii) are complete and accurate in all material respects and fairly
present the financial condition of Holdings and its Subsidiaries as of the date
thereof and results of operations and cash flows for the period covered thereby;
and
(iii) except as specifically disclosed in Schedule 6.11, show all
material Indebtedness and other liabilities, direct or contingent, of Holdings
and its consolidated
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Subsidiaries as of the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(b) Since December 31, 2000, there has not been, nor is it
reasonably likely that there will be, any Material Adverse Effect.
(c) Any pro forma financial statements of Holdings and its
Subsidiaries furnished by Holdings to the Banks hereunder were prepared in
accordance with GAAP, are complete and accurate in all material respects and
fairly present the pro forma financial condition of Holdings and its
Subsidiaries as of the date thereof, and any financial projections furnished to
the Banks hereunder represent Holdings' best estimates and assumptions as to
future performance, which Holdings believes to be fair and reasonable as of the
time made in the light of current and reasonably foreseeable business
conditions.
6.12 Environmental Matters. Holdings conducts in the ordinary course of
business a review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties, and as a result
thereof Holdings has reasonably concluded that, except as specifically disclosed
in Schedule 6.12, such Environmental Laws and Environmental Claims could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(a) To the best knowledge of Holdings, except as specifically
disclosed in Schedule 6.12, the ongoing operations of Holdings and each of its
Subsidiaries comply in all respects with all Environmental Laws, except such
non-compliance which would not (if enforced in accordance with applicable law)
result in liability in excess of $1,000,000 in the aggregate.
(b) Except as specifically disclosed in Schedule 6.12, Holdings and
each of its Subsidiaries have obtained all licenses, permits, authorizations and
registrations required under any Environmental Law ("Environmental Permits") and
necessary for their respective ordinary course operations, all such
Environmental Permits are in good standing, and Holdings and each of its
Subsidiaries are in compliance with all material terms and conditions of such
Environmental Permits.
(c) Except as specifically disclosed in Schedule 6.12, none of
Holdings, any of its Subsidiaries or any of their respective present property or
operations, is subject to any outstanding written order from or agreement with
any Governmental Authority, nor subject to any judicial or docketed
administrative proceeding, respecting any Environmental Law, Environmental Claim
or Hazardous Material.
(d) Except as specifically disclosed in Schedule 6.12, there are no
Hazardous Materials or other conditions or circumstances existing with respect
to any property of Holdings or any Subsidiary, or arising from operations prior
to the Effective Date, of Holdings or any of its Subsidiaries that would
reasonably be expected to give rise to Environmental Claims with a potential
liability of Holdings and its Subsidiaries in excess of $1,000,000 in the
aggregate for any such condition, circumstance or property. In addition, (i)
neither Holdings nor any Subsidiary has any underground storage tanks (A) that
are not properly registered or permitted under applicable Environmental Laws, or
(B) that are leaking or disposing of Hazardous
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Materials off-site, and (ii) Holdings and its Subsidiaries have notified all of
their employees of the existence, if any, of any health hazard arising from the
conditions of their employment and have met all notification requirements under
Title III of CERCLA and all other Environmental Laws.
6.13 Collateral Documents. (a) (i) The provisions of each of the
Collateral Documents were, as of the Closing Date, and as amended, remain, as of
the Effective Date, effective to create in favor of the Agent for the benefit of
the Banks, a legal, valid and enforceable first priority Lien in all right,
title and interest of Holdings, or the applicable Subsidiary (as the case may
be), in the Collateral described therein, (ii) financing statements were filed
by the Closing Date in the offices in all of the jurisdictions listed in the
schedule to the Security Agreement and each Intellectual Property Security
Agreement has been filed in the U.S. Patent and Trademark Office and the U.S.
Copyright Office, and (iii) amendments to financing statements were filed in the
respective jurisdictions of organization of each of Holdings and the Guarantors
party hereto, as necessary, by the Effective Date as are required to ensure the
perfection of all of the Collateral pursuant to the requirements of Article 9 of
the Uniform Commercial Code as is in effect in California on and after July 1,
2001.
(b) Each Mortgage when delivered was, as of the Closing Date, and as
amended, remains, as of the Effective Date, effective to grant to the Agent for
the benefit of the Banks a legal, valid and enforceable deed of trust/mortgage
Lien on all the right, title and interest of the mortgagor under such Mortgage
in the Mortgaged Property described therein. Each such Mortgage was duly
recorded in the offices listed on the schedule to such Mortgage and the mortgage
recording fees and taxes in respect thereof were paid and compliance was
otherwise had with the formal requirements of state law applicable to the
recording of real estate mortgages generally. Each such Mortgaged Property,
subject to the encumbrances and exceptions to title set forth therein and except
as noted in the title policies delivered to the Agent pursuant to Section 5.01,
is subject to a legal, valid, enforceable and perfected first priority Lien. In
addition, financing statements have been filed in the offices specified in such
Mortgage thereby creating a legal, valid, enforceable and perfected first Lien
on all right, title and interest of Holdings or such Subsidiary under such
Mortgage in all personal property and fixtures which is covered by such
Mortgage, subject to no other Liens, except the encumbrances and exceptions to
title set forth therein and except as noted in the title policies delivered to
the Agent pursuant to Section 5.01, and Permitted Liens.
(c) All representations and warranties of Holdings and any of its
Subsidiaries party thereto contained in the Collateral Documents are true and
correct.
6.14 Regulated Entities. None of Holdings, any Person controlling
Holdings, or any Subsidiary, is an "Investment Company" within the meaning of
the Investment Company Act of 1940. No Loan Party is subject to regulation 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 limiting its ability to incur Indebtedness.
6.15 No Burdensome Restrictions. Neither Holdings nor any Subsidiary is a
party to or bound by any Contractual Obligation, or subject to any restriction
in any Organization Document, or any Requirement of Law, which could reasonably
be expected to have a Material
62
Adverse Effect. Neither Holdings nor any Subsidiary is a party to or bound by
any Contractual Obligation which restricts, limits or prohibits the payment of
dividends by any Subsidiary or the making of any other distribution in respect
of such Subsidiary's capital stock.
6.16 Copyrights, Patents, Trademarks and Licenses, Etc. Holdings or its
Subsidiaries own or are licensed or otherwise have the right to use all of the
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of Holdings and 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 Holdings or
any Subsidiary infringes upon any rights held by any other Person. Except as
specifically disclosed in Schedule 6.05, no claim or litigation regarding any of
the foregoing is pending or, to the best knowledge of Holdings and the Company,
threatened, and no patent, invention, device, application, principle or any
statute, law, rule, regulation, standard or code is pending or, to the best
knowledge of Holdings and the Company, proposed, which, in either case, could
reasonably be expected to have a Material Adverse Effect.
6.17 Subsidiaries. As of the Effective Date, Holdings has no Subsidiaries
other than those specifically disclosed in part (a) of Schedule 6.17 and has no
equity investments in any other Person other than those specifically disclosed
in part (b) of Schedule 6.17. All U.S. Subsidiaries of Holdings as of the
Effective Date are identified as such on part (a) of Schedule 6.17.
6.18 Insurance. Except as specifically disclosed in Schedule 6.18, the
properties of Holdings and its Subsidiaries are insured with financially sound
and reputable insurance companies not Affiliates of Holdings, in such amounts,
with such deductibles and covering such risks as are deemed to be appropriate by
Holdings in the exercise of its reasonable business judgment.
6.19 Swap Obligations. (a) Neither Holdings nor any of its Subsidiaries
has incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. In the ordinary course of managing its business,
Holdings undertakes its own independent assessment of its consolidated assets,
liabilities and commitments and considers appropriate means of mitigating and
managing risks associated with such matters, and Holdings has not relied on any
swap counterparty or any Affiliate of any swap counterparty in determining
whether to enter into any Swap Contract.
(b) Neither Holdings nor any of its Subsidiaries has entered into
any master agreement relating to Swap Contracts and under which termination
values resulting from Swap contracts that are Specified Swap Contracts are
nettable against termination values resulting from Swap Contracts that are not
Specified Swap Contracts, unless only Specified Swap Contracts are outstanding
under such master agreement.
6.20 Real Property. Schedule 6.20 contains a complete listing of all real
property owned by Holdings or any of its Subsidiaries as of the Effective Date,
and identifies which of such properties constitute Mortgaged Property as of the
Effective Date.
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6.21 Full Disclosure. None of the representations or warranties made by
any Loan Party in the Loan Documents as of the date such representations and
warranties are made or deemed made, and none of the statements contained in any
exhibit, report, statement or certificate furnished by or on behalf of any Loan
Party in connection with the Loan Documents (including the offering and
disclosure materials delivered by or on behalf of any Loan Party to the Banks
prior to the Effective Date), 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 as of the time when made or delivered; provided that to the
extent any such information, report, financial statement, exhibit or schedule
was based upon or constitutes a forecast or projection, such Loan Party
represents only that it acted in good faith and utilized reasonable assumptions
and due care in the preparation of such information, report, financial
statement, exhibit or schedule (it being understood that forecasts and
projections by their nature involve approximations and uncertainties).
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Banks waive compliance in writing:
7.01 Financial Statements. Holdings shall deliver to the Agent and each
Bank, in form and detail satisfactory to the Agent and the Majority Banks:
(a) 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
Holdings 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 unqualified opinion of
PricewaterhouseCoopers LLP or another nationally-recognized independent public
accounting firm (the "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 as to (i) going concern or (ii)
any limitation in the scope of the audit;
(b) as soon as available, but not later than 45 days after the end
of each of the first three fiscal quarters of each fiscal year, a copy of the
unaudited consolidated balance sheet of Holdings 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 of Holdings as being complete and accurate in all material respects and
fairly presenting, in accordance with GAAP (subject to ordinary, good faith
year-end audit adjustments), the financial position and the results of
operations and cash flows of Holdings and the Subsidiaries; and
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(c) promptly, such other financial statements and information
(including financial information regarding Minority Investments) as the Agent,
at the request of any Bank, may from time to time request.
As to any information contained in materials furnished pursuant to subsection
7.02(e), Holdings shall not be separately required to furnish such information
under subsection (a) or (b) above, but the foregoing shall not be in derogation
of the obligation of Holdings to furnish the information and materials described
in subsection (a) and (b) above at the times specified therein.
7.02 Certificates; Other Information. Holdings shall furnish to the Agent
and each Bank:
(a) concurrently with the delivery of the financial statements
referred to in subsection 7.01(a), a certificate of the Independent Auditor
stating that in the course of the regular examination of the business of
Holdings and its Subsidiaries, which examination was conducted by such
accounting firm in accordance with GAAP, nothing has come to the attention of
the Independent Auditor which would cause it to believe that a Default or Event
of Default has occurred and is continuing, or if, in the opinion of the
Independent Auditor, a Default or an Event of Default has occurred and is
continuing, a statement as to the nature thereof.
(b) within 90 days after the close of each fiscal year, an update of
the projections delivered to the Banks prior to the Effective Date (the
"Effective Date Projections") for the then-current and next succeeding four
fiscal years, certified by a Responsible Officer of Holdings, together with a
statement of such Responsible Officer explaining in reasonable detail any
significant variances from the Effective Date Projections;
(c) concurrently with the delivery of the financial statements
referred to in subsections 7.01(a) and (b), a Compliance Certificate executed by
a Responsible Officer of Holdings;
(d) within 30 days after the end of each calendar month, a Borrowing
Base Certificate appropriately completed by a Responsible Officer of Holdings;
(e) not later than 15 days before the end of each fiscal year,
projections of consolidated balance sheets of Holdings and its Subsidiaries and
of the related consolidated statements of income or operations, shareholders'
equity and cash flows for the upcoming fiscal year;
(f) promptly, copies of all financial statements and reports that
Holdings sends to its shareholders, and copies of all financial statements and
regular, periodical or special reports (including Forms 10K, 10Q and 8K) that
Holdings or any Subsidiary may make to, or file with, the SEC;
(g) promptly upon sending or receipt, copies of any and all
management letters and correspondence relating to management letters, sent or
received by Holdings or any of its Subsidiaries to or from the Independent
Auditor;
65
(h) at the same time it is provided to the holders of any Permitted
Subordinated Debt, any notices and other information provided to such holders
pursuant to the reporting and notices provisions of the Subordinated Debt
Documents (without duplication of any notices, financial statements and other
information required hereunder);
(i) within 20 days of the Agent's or any Bank's request therefor,
(i) a current list of the names, addresses and outstanding debts of all Account
Debtors, and (ii) a current list of the names, addresses and outstanding amounts
due all creditors of Holdings or any Subsidiary;
(j) concurrently with the delivery of the financial statements
referred to in subsections 7.01(a) and (b), an Update Certificate, in
substantially the form of Exhibit K, executed by a Responsible Officer of
Holdings;
(k) promptly, such additional information regarding the business,
financial or corporate affairs of Holdings or any Subsidiary as the Agent, at
the request of any Bank, may from time to time request.
7.03 Notices. Holdings shall promptly notify the Agent:
(a) of the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that foreseeably will
become a Default or Event of Default;
(b) of any matter that has resulted or could result in a Material
Adverse Effect, including (i) any breach or non-performance of, or any default
under, any Contractual Obligation of Holdings or any of its Subsidiaries which
has resulted or could result in a Material Adverse Effect; and (ii) any dispute,
litigation, investigation, proceeding or suspension which may exist at any time
between Holdings or any of its Subsidiaries and any Governmental Authority
(including under or pursuant to any Environmental Laws) which has resulted or
could result in a Material Adverse Effect;
(c) of the commencement of, or any material development in, any
litigation or proceeding affecting Holdings or any Subsidiary (i) which, if
adversely determined, would reasonably be expected to have a Material Adverse
Effect, or (ii) in which the relief sought is an injunction or other stay of the
performance of this Agreement or any Loan Document;
(d) upon, but in no event later than 10 days after, becoming aware
of (i) any and all enforcement, cleanup, removal or other governmental or
regulatory actions instituted, completed or threatened against Holdings or any
Subsidiary or any of their respective properties pursuant to any applicable
Environmental Laws, (ii) all other Environmental Claims, and (iii) any
environmental or similar condition on any real property adjoining or in the
vicinity of the property of Holdings or any Subsidiary that could reasonably be
anticipated to cause such property or any part thereof to be subject to any
restrictions on the ownership, occupancy, transferability or use of such
property under any Environmental Laws;
(e) of any other litigation or proceeding affecting Holdings or any
of its Subsidiaries which Holdings would be required to report to the SEC
pursuant to the Exchange Act, within four days after reporting the same to the
SEC;
66
(f) of the occurrence of any of the following events affecting
Holdings 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 Holdings or any ERISA Affiliate with
respect to such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any
Pension Plan;
(iii) the adoption of, or the commencement of contributions to, any
Plan subject to Section 412 of the Code by Holdings or any ERISA Affiliate; or
(iv) 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;
(g) of any material change in accounting policies or financial
reporting practices by Holdings or any of its consolidated Subsidiaries; and
(h) upon the request from time to time of the Agent or any Bank, the
Swap Termination Values, together with a description of the method by which such
amounts were determined, relating to any then-outstanding Swap Contracts to
which Holdings or any of its Subsidiaries is party;
(i) the occurrence of any Event of Loss exceeding $1,000,000;
(j) of the entry by Holdings into any Specified Swap Contract,
together with the details thereof; and
(k) of the occurrence of any default, event of default, termination
event or other event under any Specified Swap Contract that after the giving of
notice, passage of time or both, would permit either counterparty to such
Specified Swap Contract to terminate early any or all trades relating to such
contract.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer of Holdings setting forth details of the
occurrence referred to therein, and stating what action Holdings or any affected
Subsidiary proposes to take with respect thereto and at what time. Each notice
under subsection 7.03(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.
7.04 Preservation of Corporate Existence, Etc. Holdings shall, and shall
cause each Subsidiary to, except in connection with transactions permitted by
Section 8.03 and sales of assets permitted by Section 8.02:
(a) preserve and maintain in full force and effect its (i) legal
existence and (ii) good standing under the laws of its state or jurisdiction of
incorporation or formation;
67
(b) preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
or desirable in the normal conduct of its business;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
7.05 Maintenance of Property. Holdings shall, and shall cause each
Subsidiary to, maintain, and preserve all its property which is used or useful
in its business in good repair and condition, and from time to time make
necessary repairs, renewals and replacements thereto so that its property shall
be fully and efficiently preserved and maintained consistent with Holdings' or
such Subsidiary's past practice.
7.06 Insurance. In addition to insurance requirements set forth in the
Collateral Documents, Holdings shall maintain, and shall cause each Subsidiary
to maintain, with financially sound and reputable independent insurers,
insurance with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons, including workers' compensation
insurance, public liability and property and casualty insurance. All such
insurance shall name the Agent as loss payee/mortgagee and as additional
insured, for the benefit of the Banks, as their interests may appear. All
casualty and key man insurance maintained by Holdings shall name the Agent as
loss payee and all liability insurance shall name the Agent as additional
insured for the benefit of the Banks, as their interests may appear. Upon the
request of the Agent or any Bank, Holdings shall furnish the Agent, with
sufficient copies for each Bank, at reasonable intervals (but not more than once
per calendar year) a certificate of a Responsible Officer of Holdings (and, if
requested by the Agent, any insurance broker of Holdings) setting forth the
nature and extent of all insurance maintained by Holdings and its Subsidiaries
in accordance with this Section or any Collateral Documents (and which, in the
case of a certificate of a broker, were placed through such broker).
7.07 Payment of Obligations. Holdings shall, and shall cause each of its
Subsidiaries to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets, unless the same are being contested
in good faith by appropriate proceedings and adequate reserves in accordance
with GAAP are being maintained by Holdings or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien
upon its property not constituting a Permitted Lien; and
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(c) all Indebtedness, as and when due and payable, but subject to
any subordination provisions contained in any instrument or agreement evidencing
such Indebtedness (except where failure to do so would not otherwise constitute
a Default or Event of Default hereunder).
7.08 Compliance with Laws. Holdings 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.
7.09 Compliance with ERISA. Holdings 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.
7.10 Inspection of Property and Books and Records. (a) Holdings shall, 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 Holdings and such Subsidiary. Holdings shall permit, and
shall cause each Subsidiary to 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,
operating and other 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, all at the expense of
Holdings and the Company and at such reasonable times during normal business
hours and as often as may be reasonably desired, upon reasonable advance notice
to Holdings; provided, however, when an Event of Default exists the Agent or any
Bank may do any of the foregoing at any time during normal business hours and
without advance notice;
(b) Without limiting the generality of subsection 7.10(a), as
frequently as the Majority Banks may deem appropriate, each of Holdings and the
Company will provide Agent or its designee access to Holdings' and the Company's
records and premises and allow such auditors or appraisers to conduct audits of
Holdings' and its Subsidiaries' accounts, including Accounts and Inventory.
Holdings shall pay all reasonable fees and expenses of one such audit in any
12-month period; provided, however, that during the existence of any Event of
Default, Holdings shall pay all reasonable fees and expenses of each such audit.
7.11 Environmental Laws. (a) Holdings shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws.
(b) Upon the written request of the Agent or any Bank, Holdings
shall submit and cause each of its Subsidiaries to submit, to the Agent with
sufficient copies for each Bank, at Holdings' sole cost and expense, at
reasonable intervals, a report providing an update of the status of any
environmental, health or safety compliance, hazard or liability issue identified
in
69
any notice or report required pursuant to subsection 7.03(d), that could,
individually or in the aggregate, result in liability in excess of $1,000,000.
7.12 Use of Proceeds. Holdings shall, directly or indirectly, use the
proceeds of the Loans (i) for Permitted Acquisitions, (ii) for making
Investments permitted under Section 8.04, and (iii) for working capital and
other general corporate purposes not in contravention of any Requirement of Law
or of any Loan Document.
7.13 Additional Guarantors. (a) If a Minority Investment or Subsidiary
shall at any time become a U.S. Subsidiary, or if Holdings, or any Subsidiary of
Holdings, otherwise shall incorporate, create or acquire any U.S. Subsidiary,
Holdings shall cause such U.S. Subsidiary to furnish promptly, but in no event
more than 30 days thereafter, each of the following to the Agent, in sufficient
quantities for each Bank:
(i) a duly executed notice and agreement in substantially the form
of Exhibit G (an "Additional Guarantor Assumption Agreement");
(ii) (A) copies of the resolutions of the board of directors (or
equivalent governing body) of such Subsidiary approving and authorizing the
execution, delivery and performance by such Subsidiary of its Additional
Guarantor Assumption Agreement and this Agreement, certified as of the date of
such Additional Guarantor Assumption Agreement (the "Additional Guarantor
Accession Date") by the Secretary or an Assistant Secretary (or other
appropriate officer) of such Subsidiary; (B) a certificate of the Secretary or
Assistant Secretary (or other appropriate officer) of such Subsidiary certifying
the names and true signatures of the officers of such Subsidiary authorized to
execute and deliver and perform, as applicable, its Additional Guarantor
Assumption Agreement, this Agreement and all other Loan Documents to be
delivered hereunder; (C) copies of the articles or certificate of incorporation
and bylaws (or other applicable Organization Documents) of such Subsidiary as in
effect on the Additional Guarantor Accession Date, certified by the Secretary or
Assistant Secretary (or other appropriate officer) of such Subsidiary as of the
Additional Guarantor Accession Date; and (D) an opinion of counsel to such
Subsidiary and addressed to the Agent and the Banks, substantially in the form
of Exhibit H; and
(iii) (A) such amendments to the schedules to the Security Agreement
as shall be required in connection with the accession of such Subsidiary
thereto;(B) executed UCC-1 financing statements furnished by the Agent in each
jurisdiction in which such filing is necessary to perfect the security interest
of the Agent on behalf of the Banks in the Collateral of such Subsidiary and in
which the Agent requests that such filing be made, and (C) if requested by the
Agent, such Mortgages and other documents as may be required to create and
perfect a lien in the interests of such Subsidiary in any real property and such
title insurance policies and other documents as the Agent or the Majority Banks
may reasonably request in connection therewith.
(b) Additionally, Holdings and such Subsidiary shall have executed
and delivered to the Agent (in sufficient quantities for each Bank) such other
items as reasonably requested by the Agent in connection with the foregoing,
including officers' certificates, search reports and other certificates and
documents.
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7.14 Additional Subsidiaries. If Holdings, directly or indirectly,
incorporates, creates or acquires any additional Subsidiary, or if any Minority
Investment shall become a Subsidiary, then within ten (10) days thereafter,
Holdings shall (i) (A) pledge the capital stock of such additional Subsidiary to
the Agent pursuant to the Security Agreement, if such stock is directly owned by
Holdings, or (B) if such stock is owned by a Subsidiary, cause such Subsidiary
to pledge the capital stock of such additional Subsidiary to the Agent pursuant
to the Security Agreement, and (ii) execute and deliver, or cause such
Subsidiary to have executed and delivered, to the Agent stock transfer powers
executed in blank with signatures guaranteed as the Agent shall request, such
UCC-1 financing statements (as furnished by the Agent) in each jurisdiction in
which such filing is necessary to perfect the security interest of the Agent in
the Collateral with respect to Holdings or such Subsidiary, and (iii) deliver
such other items as reasonably requested by the Agent in connection with the
foregoing, including resolutions, incumbency and officers' certificates,
opinions of counsel, search reports and other certificates and documents;
provided, however, that if any such additional Subsidiary is not a U.S.
Subsidiary, in no event shall more than 65% of the capital stock of any such
Subsidiary be required to be so pledged.
7.15 Environmental Review. Holdings shall deliver to the Agent, promptly
upon the granting of any Lien in favor of the Agent for the benefit of the Banks
from and after the Effective Date, with respect to any real property, an
environmental site assessment or other environmental analysis, report or review
with respect to any such real property in form and substance reasonably
satisfactory to the Agent. If any such environmental site assessment or other
environmental analysis, report or review with respect to any Mortgaged Property
shall indicate the presence of any Hazardous Materials on or in the vicinity of
such Mortgaged Property or otherwise shall indicate any environmental problem
with respect to such Mortgaged Property (including any environmental problem
which may give rise to any Environmental Claim) which, in the reasonable
determination of the Agent, adversely affects the value of such Mortgaged
Property or causes the Agent to desire to exclude such Mortgaged Property from
the Collateral, then Holdings shall, and shall cause its Subsidiaries to, enter
into and deliver to the Agent one or more Mortgages in respect of additional or
replacement real property Collateral, in form and substance reasonably
satisfactory to the Agent, together with such title insurance policies,
insurance endorsements, surveys, appraisals, consents, estoppels, subordination
agreements and other documents and other instruments as the Agent shall
reasonably request.
7.16 Further Assurances. (a) Holdings shall ensure that all written
information, exhibits and reports furnished to the Agent or the Banks do not and
will not contain any untrue statement of a material fact and do not and will not
omit to state any material fact or any fact necessary to make the statements
contained therein not misleading in light of the circumstances in which made,
and will promptly disclose to the Agent and the Banks and correct any defect or
error that may be discovered therein or in any Loan Document or in the
execution, acknowledgement or recordation thereof.
(b) If at any time Holdings, the Company or any Subsidiary shall
become the owner of any real property that is located in the United States that
has a fair market or book value equal to at least $1,000,000, then, upon the
request of the Agent or the Majority Banks, Holdings and the Company shall (and
shall cause any of their Subsidiaries to) promptly, and in any event within
thirty (30) days following acquisition of such real property, enter into and
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deliver to the Agent a Mortgage in respect to such property, in form and
substance reasonably satisfactory to the Agent, together with such title
insurance policies, insurance endorsements, surveys, appraisals, consents,
estoppels, subordination agreements and other documents and other instruments as
the Agent or the Majority Banks shall reasonably request.
(c) Promptly upon request by the Agent or the Majority Banks,
Holdings shall (and shall cause any of its Subsidiaries to) do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreements, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments the Agent or such
Banks, as the case may be, may reasonably require from time to time in order (i)
to carry out more effectively the purposes of this Agreement or any other Loan
Document, (ii) to subject to the Liens created by any of the Collateral
Documents any of the properties, rights or interests covered by any of the
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Collateral Documents and the Liens intended to be
created thereby, and (iv) to better assure, convey, grant, assign, transfer,
preserve, protect and confirm to the Agent and Banks the rights granted or now
or hereafter intended to be granted to the Banks under any Loan Document or
under any other document executed in connection therewith.
7.17 Post-Closing Deliveries. To the extent not already delivered as of
the Effective Date, Holdings shall deliver to the Agent within sixty (60) days
after the Effective Date (i) surveys of the properties located in Frisco, Texas
and Glendale, Arizona as required under Section 5.01(k)(vi), and (ii) appraisal
of the properties located in Frisco, Texas and Glendale, Arizona as required
under Section 5.01(k)(vii).
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Banks waive compliance in writing:
8.01 Limitation on Liens. (a) Holdings shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, make, create, incur, assume or
suffer to exist any Lien upon or with respect to any part of its property,
whether now owned or hereafter acquired, other than the following ("Permitted
Liens"):
(i) any Lien existing on the Effective Date and set forth in
Schedule 8.01 securing Indebtedness outstanding on such date;
(ii) any Lien created under any Loan Document;
(iii) Liens for taxes, fees, assessments or other governmental
charges which are not delinquent or remain payable without penalty, or to the
extent that non-payment thereof is permitted by subsection 7.07(a), provided
that no notice of Lien has been filed or recorded under the Code;
72
(iv) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary course
of business which are not delinquent or remain payable without penalty or which
are being contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto;
(v) Liens (other than any Lien imposed by ERISA and other than on
the Collateral) consisting of pledges or deposits required in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other social security legislation;
(vi) Liens securing (A) the non-delinquent performance of bids,
trade contracts (other than for borrowed money), leases (other than Capital
Leases), statutory obligations, (B) contingent obligations on surety and appeal
bonds, and (C) other non-delinquent obligations of a like nature; in each case,
incurred in the ordinary course of business, provided all such Liens in the
aggregate would not (even if enforced) cause a Material Adverse Effect;
(vii) Liens (other than Liens on the Collateral) consisting of
judgment or judicial attachment liens, provided that the enforcement of such
Liens is effectively stayed and all such Liens in the aggregate at any time
outstanding for Holdings and its Subsidiaries do not exceed $1,000,000;
(viii) 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 Holdings and its Subsidiaries;
(ix) Liens on specific tangible assets of Persons which become
Subsidiaries after the date of this Agreement; provided, however, that (A) such
Liens existed at the time the respective Persons became Subsidiaries and were
not created in anticipation thereof, (B) any such Lien does not by its terms
cover any assets after the time such Person becomes a Subsidiary which were not
covered immediately prior thereto, (C) any such Lien does not by its terms
secure any Indebtedness other than Indebtedness existing immediately prior to
the time such Person becomes a Subsidiary, and (D) such Indebtedness is
permitted by Section 8.05(d);
(x) purchase money Liens on any property acquired or held by
Holdings or its Subsidiaries in the ordinary course of business, securing
Indebtedness incurred or assumed for the purpose of financing all or any part of
the cost of acquiring such property; provided that (i) any such Lien attaches to
such property concurrently with or within 20 days after the acquisition thereof,
(ii) such Lien attaches solely to the property so acquired in such transaction,
(iii) the principal amount of the Indebtedness secured thereby does not exceed
100% of the cost of such property, and (iv) such Indebtedness is permitted under
subsection 8.05(d);
(xi) Liens securing obligations in respect of Capital Leases on
assets subject to such leases, provided that such Capital Leases are otherwise
permitted hereunder;
(xii) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or
73
other funds maintained with a creditor depository institution; provided that (A)
such deposit account is not a dedicated cash collateral account and is not
subject to restrictions against access by Holdings in excess of those set forth
by regulations promulgated by the FRB, and (B) such deposit account is not
intended by Holdings or any Subsidiary to provide collateral to the depository
institution;
(xiii) Liens consisting of pledges of cash collateral or government
securities to secure on a xxxx-to-market basis Permitted Swap Obligations only,
provided that (A) the counterparty to any Swap Contract relating to such
Permitted Swap Obligation is under a similar requirement to deliver similar
collateral from time to time to Holdings or the Subsidiary party thereto on a
xxxx-to-market basis; and (B) the aggregate value of such collateral so pledged
by Holdings and the Subsidiaries together in favor of any counterparty does not
at any time exceed $3,000,000; and
(xiv) Liens not otherwise permitted hereunder securing Indebtedness
in principal amount not exceeding $5,000,000 in the aggregate at any time
outstanding; provided that (A) no such Lien shall attach to any Collateral and
(B) such Indebtedness is otherwise permitted hereunder.
(b) Holdings shall not, and shall not permit any of its Subsidiaries
to, enter into or suffer to exist any agreement (other than this Agreement)
prohibiting or conditioning the creation or assumption of any Lien upon any of
its properties, revenues or assets, whether now owned or hereafter acquired.
Notwithstanding the foregoing, no other Liens may exist at any time on or
with respect to the Pledged Collateral.
8.02 Disposition of Assets. Holdings shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, sell, assign, lease, convey,
transfer or otherwise dispose of (whether in one or a series of transactions)
any property (including accounts and notes receivable, with or without recourse)
or enter into any agreement to do any of the foregoing, except:
(a) dispositions of inventory or equipment, all in the ordinary
course of business;
(b) 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 reasonably promptly applied to the
purchase price of such replacement equipment;
(c) dispositions of inventory and equipment by the Company or any
Subsidiary to the Company or any Subsidiary pursuant to reasonable business
requirements and in the ordinary course of business;
(d) the lease or sublease of real property by Holdings or any
Subsidiary to other Persons in the ordinary course of business;
74
(e) the sale of cash equivalents and other short term money market
investments in the ordinary course of business pursuant to Holdings' usual and
customary cash management policies and procedures;
(f) dispositions of inventory and equipment (other than dispositions
permitted under subsection (a)) by Holdings or any Subsidiary to any Person in
which Holdings has a Minority Investment, provided that the aggregate amount of
such dispositions in any calendar year, plus the aggregate amount of Minority
Investments under subsection 8.04(d) in such year, does not exceed the sublimit
of the Annual Limit specified in subsection 8.04(d);
(g) dispositions pursuant to sales and leaseback transactions
permitted under Section 8.14; and
(h) dispositions not otherwise permitted hereunder which are made
for fair market value (as determined in good faith by Holdings or the Company);
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, (iii) immediately after giving effect to
such disposition, the Disposition Value of all assets disposed of as permitted
by this subsection 8.02(h) during the period of 365 days ending on the date of
such proposed sale (but excluding the Disposition Value of any real property so
disposed of, provided that the proceeds of any such disposition are reinvested
within six (6) months of such disposition in similar replacement property) shall
not exceed 15% of Total Assets determined as of such date, (iv) no disposition
by Holdings of any of its equity interest in the Company shall be permitted
hereunder, and (v) no dispositions of accounts or notes receivable shall be
permitted hereunder unless in connection with the sale of all or substantially
all of a business unit, division or Subsidiary of Holdings and such sale is
otherwise permitted hereunder.
8.03 Consolidations and Mergers. Holdings shall not, and shall not suffer
or permit any Subsidiary to, merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except:
(a) any Subsidiary may merge with Holdings, provided that Holdings
shall be the continuing or surviving Person, or with any one or more
Subsidiaries, provided that if any transaction shall be between a Subsidiary and
a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be the continuing
or surviving Person;
(b) as permitted by Section 8.02;
(c) any Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise), to Holdings or to a Wholly-Owned
Subsidiary; and
(d) Holdings or any Subsidiary thereof may merge with or consolidate
into any other Person, provided that (i) (in the case of Holdings) Holdings
shall be the continuing or surviving Person, (ii) such merger or consolidation
is in connection with a Permitted Acquisition, and (iii) no such merger or
consolidation shall be made while there exists a Default or if a Default would
occur as a result thereof.
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8.04 Loans and Investments. Holdings shall not purchase or acquire, or
suffer or permit any Subsidiary to purchase or acquire, or make any commitment
therefor, any capital stock, equity interest, or any obligations or other
securities of, or any interest in, any Person, or make or commit to make any
Acquisitions, or make or commit to make any advance, loan, extension of credit
or capital contribution to or any other investment in, any Person including any
Affiliate of Holdings (together, "Investments") except for:
(a) Investments held by Holdings or Subsidiary in the form of cash
equivalents and short term money market investments in the ordinary course of
business pursuant to Holdings' usual and customary cash management policies and
procedures;
(b) 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;
(c) Investments in the capital stock of Wholly-Owned Subsidiaries,
and extensions of credit by Holdings to any of its Wholly-Owned Subsidiaries or
by any of its Wholly-Owned Subsidiaries to Holdings or to any other Wholly-Owned
Subsidiaries in the ordinary course of business;
(d) Investments constituting Minority Investments and Investments
incurred in order to consummate Permitted Acquisitions, provided that (i) all
such Investments in the aggregate, plus the aggregate amount of dispositions
under subsection 8.02(f), do not exceed $60,000,000 in any calendar year (the
"Annual Limit"), (ii) all such Investments constituting Minority Investments,
plus the aggregate amount of dispositions under subsection 8.02(f), do not
exceed a sublimit of $25,000,000 in any calendar year, (iii) no such Investment
shall be made if the Subsidiary or the Person in which Holdings has a Minority
Investment, as the case may be, that is the subject of such Investment shall not
be a U.S. Subsidiary or is located outside the United States, and (iv) on and
after the effectiveness of any Investment, Holdings shall not be in violation of
any of the financial covenants contained in Section 8.19 hereof;
(e) Investments constituting Permitted Swap Obligations or payments
or advances under Swap Contracts relating to Permitted Swap Obligations; and
(f) officer, shareholder, director and employee loans and guarantees
in accordance with Holdings' and its Subsidiaries' usual and customary practices
with respect thereto in aggregate amount not exceeding $1,000,000 at any time.
8.05 Limitation on Indebtedness. Holdings shall not, and shall not suffer
or permit any Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 8.08;
(c) Indebtedness existing on the Effective Date and set forth in
Schedule 8.05;
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(d) Indebtedness secured by Liens permitted by clauses (ix), (x) and
(xiv) of subsection 8.01(a) in an aggregate amount outstanding not to exceed
$25,000,000;
(e) Indebtedness of Wholly-Owned Subsidiaries of Holdings to
Holdings or to other Wholly-Owned Subsidiaries of Holdings;
(f) Indebtedness incurred pursuant to sales and leaseback
transactions permitted under Section 8.14;
(g) additional unsecured Indebtedness incurred after the Effective
Date in an aggregate amount not to exceed $25,000,000, provided that (i) no such
Indebtedness shall be incurred while there exists a Default or if a Default
would occur as a result thereof, and (ii) without limiting the generality of the
foregoing, as of the end of the most recent quarter for which Holdings has
delivered financial statements under subsection 7.01(a) or 7.01(b) and
immediately after giving effect to such incurrence, Holdings shall be in full
compliance with subsections 8.19(a) and 8.19(b); and
(h) additional Indebtedness which by its terms is expressly
subordinated to the Obligations, provided that (i) the terms of such
subordination shall be satisfactory to the Majority Banks, (ii) the terms of
such Indebtedness and the indenture or other agreement evidencing such
Indebtedness otherwise shall be satisfactory in all material respects to the
Majority Banks (including terms and conditions relating to the interest rate,
fees, amortization, maturity, covenants, events of default and remedies), (iii)
no such Indebtedness shall be incurred while there exists a Default or if a
Default would occur as a result thereof, and (iv) without limiting the
generality of the foregoing, as of the end of the most recent quarter for which
Holdings has delivered financial statements under subsection 7.01(a) or 7.01(b)
and immediately after giving effect to such incurrence, Holdings shall be in
full compliance with subsections 8.19(a) and, if then applicable, 8.19(b) (any
such Indebtedness issued in compliance with this subsection (i) hereinafter
"Permitted Subordinated Debt").
Notwithstanding anything to the contrary in this Section 8.05, the Indebtedness
of all Subsidiaries that are not Guarantors which is otherwise permitted under
this Section 8.05 shall not exceed $5,000,000 in the aggregate at any time
outstanding.
8.06 Transactions with Affiliates. Holdings shall not, and shall not
suffer or permit any Subsidiary to, enter into any transaction with any
Affiliate of Holdings, except upon fair and reasonable terms no less favorable
to Holdings or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of Holdings or such Subsidiary.
8.07 Use of Proceeds. Holdings shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the Loan proceeds or any Letter of Credit,
directly or indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or
otherwise refinance indebtedness of Holdings or others incurred to purchase or
carry Margin Stock, or (iii) to extend credit for the purpose of purchasing or
carrying any Margin Stock.
8.08 Contingent Obligations. Holdings shall not, and shall not suffer or
permit any Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations, except:
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(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of Holdings in respect of Indebtedness of
any of its Wholly-Owned Subsidiaries, or Contingent Obligations of any of its
Wholly-Owned Subsidiaries in respect of Indebtedness of another of its
Wholly-Owned Subsidiaries or of Holdings, in each case to the extent such
Indebtedness is permitted hereunder;
(d) Contingent Obligations of Holdings and its Subsidiaries existing
as of the Effective Date and listed in Schedule 8.08;
(e) Contingent Obligations with respect to Surety Instruments
incurred in the ordinary course of business and not exceeding at any time
$5,000,000 in the aggregate in respect of Holdings and its Subsidiaries
together; and
(f) Contingent Obligations of Holdings with respect to Stock Price
Guaranties incurred in the ordinary course of business and not exceeding at any
time $5,000,000 in the aggregate.
Notwithstanding anything to the contrary in this Section 8.08, the Contingent
Obligations of all Subsidiaries that are not Guarantors which are otherwise
permitted under this Section 8.08 shall not exceed $5,000,000 in the aggregate
at any time outstanding.
8.09 Subsidiaries. Holdings shall not, and shall not suffer or permit any
Subsidiary to, incorporate, create or acquire any Subsidiary which is not a U.S.
Subsidiary.
8.10 Lease Obligations. Holdings shall not, and shall not suffer or permit
any Subsidiary to, create or suffer to exist any obligations for the payment of
rent for any property under any Operating Lease, which exceed $15,000,000 in
aggregate amount in any fiscal year.
8.11 Restricted Payments. Holdings shall not, and shall not suffer or
permit any Subsidiary to, declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities on
account of any shares of any class of its capital stock (other than dividends or
other distributions by a Subsidiary to Holdings), 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 Holdings may:
(a) declare and make dividend payments or other distributions
payable solely in its common stock;
(b) purchase, redeem or otherwise acquire shares of its common stock
or warrants or options to acquire any such shares with the proceeds received
from the substantially concurrent issue of new shares of its common stock;
(c) allow any Subsidiary that is not a Wholly-Owned Subsidiary to
make distributions to its owners (on a pro rata basis);
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(d) purchase shares of Holdings' common stock either (1) for deposit
into the 401(k) trust fund on behalf of Holdings' employees by using funds
obtained through employee payroll deductions of such employees, or (2) to the
extent necessary to provide discounts to employees in connection with Holdings'
Employee Stock Purchase Plan; and
(e) dividends required to be declared or paid pursuant to the terms
of any securities issued in a Permitted Equity Offering so long as the dividend
provisions of such securities were approved by the Majority Banks in writing
prior to the issuance of such securities.
8.12 ERISA. Holdings shall not, and shall not suffer or permit any of its
ERISA Affiliates to: (a) engage in a prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan which has resulted or
could reasonably expected to result in liability of Holdings in an aggregate
amount in excess of $500,000; or (b) engage in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA.
8.13 Capital Expenditures. Holdings shall not, and shall not permit any of
its Subsidiaries to, make any Capital Expenditures in excess of, on a
consolidated basis, in any fiscal year, the sum of (a) the Capital Expenditure
Annual Limit plus (b) so long as no Event of Default has occurred and is
continuing, the Permitted Capital Expenditure Carry-Forward for all prior fiscal
years (beginning with fiscal year 1999).
8.14 Sales and Leasebacks. Holdings shall not, and shall not permit any of
its Subsidiaries to, become liable, directly or indirectly, with respect to any
lease, whether an Operating Lease or a Capital Lease, of any property (whether
real, personal or mixed), whether now owned or hereafter acquired, (i) which
Holdings or such Subsidiary has sold or transferred or is to sell or transfer to
any other Person or (ii) which Holdings or such Subsidiary intends to use for
substantially the same purposes as any other property which has been or is to be
sold or transferred by Holdings or such Subsidiary to any other Person in
connection with such lease; provided that Holdings and any of its Subsidiaries
may enter into any such lease if (A) no Default shall then exist or would occur
as a result thereof, (B) as of the end of the most recent quarter for which
Holdings has delivered financial statements under subsection 7.01(a) or 7.01(b)
and immediately after giving effect to any such lease, Holdings shall be in full
compliance with subsections 8.19(a), 8.19(b) and 8.19(c) and (C) the aggregate
amount of Indebtedness incurred in connection with all such leases shall not
exceed $25,000,000 at any time outstanding.
8.15 Certain Payments. Holdings shall not, and shall not permit any of its
Subsidiaries to, (i) prepay, redeem, repurchase or otherwise acquire for value
any of the Permitted Subordinated Debt; or (ii) make any principal, interest or
other payments on any Permitted Subordinated Debt if not permitted by the
respective subordination provisions of the Subordinated Debt Documents.
8.16 Modification of Subordinated Debt Documents. Holdings shall not, and
shall not permit any of its Subsidiaries to, agree to or permit any amendment,
modification or waiver of any provision of any Subordinated Debt Document
(including any amendment, modification or waiver pursuant to an exchange of
other securities or instruments for outstanding Permitted Subordinated Debt) if
the effect of such amendment, modification or waiver is to (i) increase
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the interest rate on such Permitted Subordinated Debt or change (to earlier
dates) the dates upon which principal and interest are due thereon; (ii) alter
the redemption, prepayment or subordination provisions thereof; (iii) alter the
covenants and events of default in a manner which would make such provisions
more onerous or restrictive to Holdings or such Subsidiary; or (iv) otherwise
increase the obligations of Holdings or such Subsidiary in respect of such
Permitted Subordinated Debt or confer additional rights upon the holders thereof
which individually or in the aggregate would be adverse to Holdings, its
Subsidiaries or the Banks.
8.17 Change in Business. Holdings shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business substantially
different from those lines of business carried on by Holdings and its
Subsidiaries on the date hereof and lines of business ancillary thereto.
8.18 Accounting Changes. Holdings shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
Holdings or of any Subsidiary, except to change the fiscal year of a Subsidiary
to conform its fiscal year to that of Holdings.
8.19 Financial Covenants. (a) Holdings shall not permit as at the end of
any fiscal quarter, measured on a consolidated basis for Holdings and its
Subsidiaries for the period of four fiscal quarters ended on such date in
accordance with GAAP, Total Funded Debt to be an amount which exceeds 60% of
Capitalization.
(b) Holdings shall not permit as at the end of any fiscal quarter,
measured on a consolidated basis for Holdings and its Subsidiaries for the
period of four fiscal quarters ended on such date in accordance with GAAP,
Senior Funded Debt to be an amount which exceeds 55% of Capitalization.
(c) Holdings shall not permit its Consolidated Net Worth as of the
last day of any fiscal quarter to be less than (a) 85% of its Consolidated Net
Worth on and as of the Effective Date, plus (b) 50% of Consolidated Net Income
for each fiscal quarter (without giving effect to any net loss for any such
period) ending after the Effective Date, plus (c) 50% of all Net Issuance
Proceeds completed in any fiscal quarter from and after the Effective Date.
(d) Holdings shall not permit as at the end of any fiscal quarter,
measured on a consolidated basis for Holdings and its Subsidiaries for the
period of four fiscal quarters ended on such date in accordance with GAAP, the
ratio of (i) EBITA to (ii) the sum of (A) cash Interest Expense, plus (B) cash
taxes, plus (C) scheduled principal payments in respect of Indebtedness to be
less than 1.20 to 1.00.
(e) Holdings shall not permit the EBITDA Ratio at any time to be
greater than the following amounts for the respective periods set forth below:
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Period EBITDA Ratio
------------------------------------ ---------------------
Effective Date through and including
March 31, 2003 3.50:1.00
April 1, 2003 through and including the
later of the Revolving Termination Date
and the Term Maturity Date 3.25:1.00
8.20 No Restrictions on Subsidiary Dividends. Holdings shall not, and
shall not suffer or permit any Subsidiary to, enter into or be bound by any
Contractual Obligation which restricts, limits or prohibits the payment of
dividends by any Subsidiary or the making of any other distribution in respect
of such Subsidiary's capital stock.
ARTICLE IX
EVENTS OF DEFAULT
9.01 Event of Default. Any of the following shall constitute an "Event of
Default":
(a) Non-Payment. Holdings fails to make, (i) when and as required to
be made herein, payments of any amount of principal of any Loan or of any L/C
Obligation, (ii) when and as required to be paid under any Specified Swap
Contract, any payment or transfer under such Specified Swap Contract, or (iii)
within three Business Days after the same becomes due, payment of any interest,
fee or any other amount payable hereunder or under any other Loan Document
(other than a Specified Swap Contract); or
(b) Representation or Warranty. Any representation or warranty by
any Loan Party made or deemed made herein, in any other Loan Document (other
than a Specified Swap Contract), or which is contained in any certificate,
document or financial or other statement by any Loan Party, or any Responsible
Officer, furnished at any time under this Agreement, or in or under any other
Loan Document (other than a Specified Swap Contract), is incorrect in any
material respect on or as of the date made or deemed made; or
(c) Specific Defaults. Holdings or the Company fails to perform or
observe any term, covenant or agreement contained in any of Section 7.04(a)(i),
or 7.12 or in Article VIII; or
(d) Other Defaults. Any Loan Party fails to perform or observe any
other term or covenant contained in this Agreement or any other Loan Document
(other than a Specified Swap Contract), and such default shall continue
unremedied for a period of 20 days after the earlier of (i) the date upon which
a Responsible Officer of Holdings or the Company obtained actual knowledge of
such failure and (ii) the date upon which written notice thereof is given to
Holdings by the Agent or any Bank; or
(e) Cross-Default. (i) Holdings or any Subsidiary (A) fails to make
any payment in respect of any Indebtedness or Contingent Obligation (other than
in respect of Swap
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Contracts), having an aggregate principal amount (including undrawn committed or
available amounts and including amounts owing to all creditors under any
combined or syndicated credit arrangement) of more than $5,000,000 when due
(whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise) and such failure continues after the applicable grace or notice
period, if any, specified in the relevant document on the date of such failure;
or (B) 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, and such failure continues
after the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure if the effect of such failure, 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 or cash collateral in respect
thereof to be demanded; or (ii) there occurs under any Swap Contract an Early
Termination Date (as defined in such Swap Contract) resulting from (1) any event
of default under such Swap Contract as to which Holdings or any Subsidiary is
the Defaulting Party (as defined in such Swap Contract) or (2) any Termination
Event (as so defined) as to which Holdings or any Subsidiary is an Affected
Party (as so defined), and, in either event, the Swap Termination Value owed by
Holdings or such Subsidiary as a result thereof is greater than $5,000,000; or
(f) Insolvency; Voluntary Proceedings. Holdings or any 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
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against Holdings or any Subsidiary, or any
writ, judgment, warrant of attachment, execution or similar process, is issued
or levied against a substantial part of Holdings' or any 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) Holdings or any 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) Holdings or any 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
(h) 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 Holdings under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $500,000; the
aggregate amount of Unfunded Pension Liability among all Pension Plans at any
time exceeds $500,000; or (iii) Holdings or any ERISA Affiliate shall fail to
pay when due, after the expiration of any applicable grace period, any
installment
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payment with respect to its withdrawal liability under Section 4201 of ERISA
under a Multiemployer Plan in an aggregate amount in excess of $500,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against
Holdings or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related or unrelated series of
transactions, incidents or conditions, of $1,000,000 or more, and the same shall
remain unsatisfied, unvacated and unstayed pending appeal for a period of 30
days after the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against Holdings 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
(k) Change of Control. There occurs any Change of Control; or
(l) Guarantor Defaults. Any Guarantor fails in any material respect
to perform or observe any term, covenant or agreement in its Guaranty; or any
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 such 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
(m) Invalidity of Subordination Provisions. The subordination
provisions applicable to the Permitted Subordinated Debt shall be for any reason
revoked or invalidated, or otherwise cease to be in full force and effect, or
the holders thereof or any other Person shall contest in any manner the validity
or enforceability thereof or denies that it has any further liability or
obligation thereunder, or the Indebtedness hereunder is for any reason
subordinated or does not have the priority contemplated by this Agreement or
such subordination provisions.
(n) Collateral. (i) Any provision of any Collateral Document shall
for any reason cease to be valid and binding on or enforceable against Holdings
or any Subsidiary party thereto or Holdings or any Subsidiary shall so state in
writing or bring an action to limit its obligations or liabilities thereunder;
or (ii) any Collateral Document shall for any reason (other than pursuant to the
terms thereof) cease to create a valid security interest in the Collateral
purported to be covered thereby or such security interest shall for any reason
cease to be a perfected and first priority security interest subject only to
Permitted Liens.
9.02 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Banks, do any or all of
the following:
(a) declare the obligation of each Bank to make any Loans hereunder
and any obligation of the Issuing Bank to Issue any Letters of Credit hereunder
to be terminated,
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whereupon such obligations and each Bank's Commitment and the L/C Commitment
shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is
or at any time thereafter may become available for drawing under any outstanding
Letters of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, which
amount shall be held by the Agent as security for Holdings' reimbursement
obligations for drawings that may subsequently occur under outstanding Letters
of Credit, and 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 Holdings; and
(c) 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 9.01 (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 and any obligation of the Issuing Bank to Issue Letters of Credit
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, the Issuing Bank or any Bank.
9.03 Specified Swap Contract Remedies. Notwithstanding any other provision
of this Article IX, each Swap Provider shall have the right, with prior notice
to the Agent, but without the approval or consent of the Agent or the other
Banks, with respect to any Specified Swap Contract of such Swap Provider, (a) to
declare an event of default, termination event or other similar event thereunder
and to create an Early Termination Date (as defined in such Specified Swap
Contract), (b) to determine net termination amounts in accordance with the terms
of such Specified Swap Contracts and to set-off amounts between such Specified
Swap Contracts, and (c) to prosecute any legal action against Holdings to
enforce net amounts owing to such Swap Provider.
ARTICLE X
THE AGENT
10.01 Appointment and Authorization; "Agent". (a) Each Bank hereby
irrevocably (subject to Section 10.09) 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 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,
84
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.
(b) The Issuing Bank shall act on behalf of the Banks with respect
to any Letters of Credit Issued by it and the documents associated therewith
until such time and except for so long as the Agent may agree at the request of
the Majority Banks to act for the Issuing Bank with respect thereto; provided,
however, that the Issuing Bank shall have all of the benefits and immunities (i)
provided to the Agent in this Article X with respect to any acts taken or
omissions suffered by the Issuing Bank in connection with Letters of Credit
Issued by it or proposed to be Issued by it and the application and agreements
for letters of credit pertaining to the Letters of Credit as fully as if the
term "Agent," as used in this Article X, included the Issuing Bank with respect
to such acts or omissions, and (ii) as additionally provided in this Agreement
with respect to the Issuing Bank.
10.02 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.
10.03 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken 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 Holdings or any Subsidiary or
Affiliate of Holdings, 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 for the value of
or title to any Collateral, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document, or
for any failure of any Loan Party 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 Holdings or any of its Subsidiaries or Affiliates.
10.04 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 any Loan Party), 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
85
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.
(b) For purposes of determining compliance with the conditions
specified in Section 5.01, 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 (or made available) 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 such Bank.
10.05 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 any Loan Party referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default." The Agent will 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 IX; 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.
10.06 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
Holdings 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 creditworthiness of
Holdings and its Subsidiaries, the value of and title to any Collateral, 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 any Loan Party 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
creditworthiness of any Loan Party. 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 creditworthiness of Holdings or any
Subsidiary which may come into the possession of any of the Agent-Related
Persons.
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10.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Banks shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company or Holdings and without limiting the obligation of the Company and
Holdings to do so), in accordance with the Banks' Pro Rata Shares, 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 to the extent they are found by a final decision of
a court of competent jurisdiction to have resulted 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 Holdings and the Company. The
undertaking in this Section shall survive the termination of the Commitments,
the termination or expiration of all Letters of Credit, the payment of all other
Obligations hereunder and the resignation or replacement of the Agent.
10.08 Agent in Individual Capacity. Xxxxx Fargo 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 Holdings and its
Subsidiaries and Affiliates as though Xxxxx Fargo were not the Agent or the
Issuing Bank hereunder and without notice to or consent of the Banks. The Banks
acknowledge that, pursuant to such activities, Xxxxx Fargo or its Affiliates may
receive information regarding Holdings or its Subsidiaries or Affiliates
(including information that may be subject to confidentiality obligations in
favor of Holdings or such Subsidiary or Affiliate) and acknowledge that the
Agent shall be under no obligation to provide such information to them. With
respect to its Loans, Xxxxx Fargo 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 or the Issuing Bank.
10.09 Successor Agent. The 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 Holdings, 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 X and Sections 11.04 and 11.05 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.
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Notwithstanding the foregoing, however, Xxxxx Fargo may not be removed as the
Agent at the request of the Majority Banks unless Xxxxx Fargo shall also
simultaneously be replaced as "Issuing Bank" and "Swingline Bank" hereunder
pursuant to documentation in form and substance reasonably satisfactory to Xxxxx
Fargo.
10.10 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:
(i) 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 W-8BEN before the payment of any interest or fees in
the first calendar year and before the payment of any interest or fees in each
third succeeding calendar year during which interest or fees may be paid under
this Agreement;
(ii) if such Bank claims that interest or fees 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 W-8ECI before the payment of any
interest or fees is due in the first taxable year of such Bank and in each
succeeding taxable year of such Bank during which interest or fees 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.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of Holdings owing 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 Holdings owing to such Bank. To the extent of such percentage
amount, the Agent will treat such Bank's IRS Form W-8BEN as no longer valid.
(c) If any Bank claiming exemption from United States withholding
tax by filing IRS Form W-8ECI with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of
Holdings owing 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.
(d) 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
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or other documentation an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction.
(e) 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 reasonable Attorney Costs). The obligation of the Banks under this
subsection shall survive the termination of the Commitments, the termination or
expiration of all Letters of Credit, the payment of all other Obligations
hereunder and the resignation or replacement of the Agent.
(f) (i) Each Bank party to this Agreement as of the Effective Date
represents and warrants to the Agent and Holdings as of the Effective Date and
(ii) each Additional Bank party to this Agreement as of the Subsequent Effective
Date represents and warrants to the Agent and Holdings as of the Subsequent
Effective Date, that under applicable law and treaties no tax is required to be
withheld by Holdings or the Agent with respect to any payments to be made to
such Bank hereunder.
10.11 Collateral Matters.
(a) The Agent is authorized on behalf of all the Banks, without the
necessity of any notice to or further consent from the Banks, from time to time
to take any action with respect to any Collateral or the Collateral Documents
which may be necessary to perfect and maintain perfected the security interest
in and Liens upon the Collateral granted pursuant to the Collateral Documents.
(b) The Banks irrevocably authorize the Agent, at its option and in
its discretion, to release any Lien granted to or held by the Agent upon any
Collateral (i) upon termination of the Commitments and payment in full of all
Loans and all other Obligations known to the Agent and payable under this
Agreement or any other Loan Document; (ii) constituting property sold or to be
sold or disposed of as part of or in connection with any disposition permitted
hereunder; (iii) constituting property in which Holdings or any Subsidiary owned
no interest at the time the Lien was granted or at any time thereafter; (iv)
constituting property leased to Holdings or any Subsidiary in a transaction
permitted under this Agreement; (v) consisting of an instrument evidencing
Indebtedness or other debt instrument, if the indebtedness evidenced thereby has
been paid in full; (vi) constituting real property to be excluded from the
Collateral pursuant to matters arising under Section 7.15; or (vii) if approved,
authorized or ratified in writing by the Majority Banks or all the Banks, as the
case may be, as provided in subsection 11.01(f). Upon request by the Agent at
any time, the Banks will confirm in writing the Agent's authority to release
particular types or items of Collateral pursuant to this subsection 10.11(b),
provided that the absence of any such confirmation for whatever reason shall not
affect the Agent's rights under this Section 10.11.
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(c) Each Bank agrees with and in favor of each other (which
agreement shall not be for the benefit of Holdings or any Subsidiary) that the
Obligations to such Bank under this Agreement and the other Loan Documents shall
not be secured by any real property collateral now or hereafter acquired by such
Bank other than the Mortgaged Properties described in the Mortgages.
10.12 Senior Managing Agents; Co-Agents. None of the Banks identified on
the facing page or signature pages of this Agreement as a "senior managing
agent" or a "co-agent" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Banks as such. Without limiting the foregoing, none of the Banks so identified
as a "senior managing agent" or a "co-agent" shall have or be deemed to have any
fiduciary relationship with any Bank. Each Bank acknowledges that it has not
relied, and will not rely, on any of the Banks so identified in deciding to
enter into this Agreement or in taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS
11.01 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 any Loan Party 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 such Loan Party 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 acknowledged by the Agent, do any of the following:
(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 9.02), provided, however, that with
respect to this clause (a), Additional Banks may become party to this Agreement
and the amount of Aggregate Term Commitments, Aggregate Revolving Commitments
and Aggregate Commitments may increase pursuant to subsections 2.01(c) and (d)
hereof without the consent of any Bank, notwithstanding that such Bank's Pro
Rata Share of the Aggregate Term Commitment or Pro Rata Share of the Aggregate
Revolving Commitment may decrease;
(b) 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
(including the date of any mandatory prepayment hereunder);
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (iii) below) any fees or other amounts
payable hereunder or under any other Loan Document;
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(d) 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;
(e) discharge any Guarantor except as otherwise may be provided
herein;
(f) release any portion of the Collateral except as otherwise may be
provided herein or in the Collateral Documents or except where the consent of
the Majority Banks only is specifically provided for;
(g) amend this Section 11.01, Section 2.15, the definition of
"Majority Banks" herein, or any provision herein providing for consent or other
action by all Banks or some specified amount of Banks; or
(h) waive any of the conditions precedent to the Effective Date set
forth in subsections 5.01(m) and 5.01(n); or
(i) amend the definition of "Borrowing Base" herein;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Bank in addition to the Majority Banks or all
the Banks, as the case may be, affect the rights or duties of the Issuing Bank
under this Agreement or any L/C-Related Document relating to any Letter of
Credit Issued or to be Issued by it, (ii) 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, (iii) the Fee Letter and
documents evidencing Specified Swap Contracts may be amended, or rights or
privileges thereunder waived, in a writing executed by the parties thereto, and
(iv) no amendment, waiver or consent shall, unless in writing and signed by the
Swingline Bank in addition to the Majority Banks or all the Banks, as the case
may be, increase the Swingline Commitment or otherwise affect the rights or
duties of the Swingline Bank under this Agreement.
11.02 Notices. (a) All notices, requests, consents, approvals, waivers and
other communications shall be in writing (including, unless the context
expressly otherwise provides, by facsimile transmission, but excluding by
electronic mail unless accompanied by notice delivered via one of the other
methods specified herein), and mailed, faxed or delivered, to the address or
facsimile number specified for notices on Schedule 11.02; or, as directed to
Holdings, 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 Holdings, the Company and the Agent.
(b) 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 mails, or if delivered, upon delivery; except that notices
pursuant to Article II, III or X to the Agent shall not be effective until
actually received by the Agent, notices pursuant to Article III to the Issuing
Bank shall not be effective until actually received by the Issuing Bank at the
address specified for the "Issuing Bank" on
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Schedule 11.02 and notices pursuant to Article II to the Swingline Bank shall
not be effective until actually received by the Swingline Bank, at the address
specified for such Person on Schedule 11.02.
(c) 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 Holdings. The Agent and the Banks shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by Holdings to
give such notice and the Agent and the Banks shall not have any liability to
Holdings 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. The
obligation of Holdings to repay the Loans and L/C Obligations 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.
11.03 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. The 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.
11.04 Costs and Expenses. Holdings shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Xxxxx Fargo (including in its capacity as Agent
and Issuing Bank) within five Business Days after demand (subject to subsection
5.01(e)) for all costs and expenses incurred by Xxxxx Fargo (including in its
capacity as Agent and Issuing Bank) in connection with (i) the development,
preparation, delivery, administration and execution of, 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, (ii) the consummation of the transactions
contemplated hereby and thereby, and (iii) the syndication and assignment
following the Effective Date of all or any part of Xxxxx Fargo's interest as
Bank hereunder, including reasonable Attorney Costs incurred by Xxxxx Fargo
(including in its capacity as Agent and Issuing Bank) with respect thereto;
(b) pay or reimburse the Agent, the Lead Arranger and each Bank
within five Business Days after demand (subject to subsection 5.01(e)) for all
invoiced (or otherwise documented) 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);
and
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(c) pay or reimburse Xxxxx Fargo (including in its capacity as
Agent) within five Business Days after demand (subject to subsection 5.01(e))
for all appraisal (including the allocated cost of internal appraisal services),
audit, environmental inspection and review (including the allocated cost of such
internal services), search and filing costs, fees and expenses, incurred or
sustained by Xxxxx Fargo (including in its capacity as Agent) in connection with
the matters referred to under subsections (a) and (b) of this Section.
11.05 Indemnification.
(a) Whether or not the transactions contemplated hereby are
consummated, each of Holdings and the 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, claims,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
settlement costs, charges, expenses and disbursements (including reasonable
Attorney Costs) of any kind or nature whatsoever which may at any time
(including at any time following repayment of the Loans, the termination of all
Specified Swap Contracts, the termination of the Letters of Credit 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, the other Loan Documents or any
document contemplated by or referred to therein, 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, the Specified
Swap Contracts, the Loans or Letters of Credit 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 neither
Holdings nor the Company shall have any obligation hereunder to any Indemnified
Person with respect to Indemnified Liabilities to the extent they are found by a
final decision of a court of competent jurisdiction to have resulted primarily
from the gross negligence or willful misconduct of such Indemnified Person. The
agreements in this Section and in Section 11.04 shall survive the termination of
the Commitments, the termination or expiration of all Letters of Credit and the
payment of all other Obligations.
(b) (i) Each of Holdings and the Company shall indemnify, defend and
hold harmless each Indemnified Person, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses or disbursements (including Attorney Costs and the allocated
cost of internal environmental audit or review services), which may be incurred
by or asserted against such Indemnified Person in connection with or arising out
of any pending or threatened investigation, litigation or proceeding, or any
action taken by any Person, with respect to any Environmental Claim arising out
of or related to any property subject to a Mortgage in favor of the Original
Agent, the Agent or any Bank. No action taken by legal counsel chosen by the
Original Agent, the Agent or any Bank in defending against any such
investigation, litigation or proceeding or requested remedial, removal or
response action shall vitiate or any way impair Holdings' and the Company's
obligation and duty hereunder to indemnify and hold harmless the Agent and each
Bank.
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(ii) In no event shall any site visit, observation, or testing by
the Agent or any Bank (or any contractee of the Agent or any Bank) be deemed a
representation or warranty that Hazardous Materials are or are not present in,
on, or under, the site, or that there has been or shall be compliance with any
Environmental Law. Neither Holdings nor any other Person is entitled to rely on
any site visit, observation, or testing by the Agent or any Bank. Neither the
Agent nor any Bank owes any duty of care to protect Holdings or any other Person
against, or to inform Holdings or any other Person of, any Hazardous Materials
or any other adverse condition affecting any site or property. Neither the Agent
nor any Bank shall be obligated to disclose to Holdings or any other Person any
report or findings made as a result of, or in connection with, any site visit,
observation, or testing by the Agent or any Bank.
(c) The obligations in this Section shall survive payment of all
other Obligations. At the election of any Indemnified Person, Holdings shall
defend such Indemnified Person using legal counsel satisfactory to such
Indemnified Person in such Person's sole discretion, at the sole cost and
expense of Holdings. All amounts owing under this Section shall be paid within
30 days after demand.
11.06 Marshalling; Payments Set Aside. Neither the Agent nor the Banks
shall be under any obligation to marshal any assets in favor of Holdings or any
other Person or against or in payment of any or all of the Obligations. To the
extent that any Loan Party 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.
11.07 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 a Loan Party 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.
11.08 Assignments, Participations, Etc. (a) Any Bank may, with the written
consent of Holdings, the Agent, the Issuing Bank and the Swingline Bank (which
in each case shall not be unreasonably withheld), at any time assign and
delegate to one or more Eligible Assignees (each an "Assignee") all, or any
ratable part of all, of the Loans, the Commitment, the L/C Obligations and the
other rights and obligations of such Bank hereunder; provided, however, that (i)
no written consent of Holdings shall be required during the existence of a
Default or an Event of Default; (ii) no written consent of Holdings or the
Agent, the Issuing Bank or the Swingline Bank shall be required in connection
with any assignment and delegation by a Bank to an Eligible Assignee that is
another Bank or an Affiliate of such Bank, provided that if the proposed
Assignee is another Bank, the Bank seeking to assign its interests hereunder
shall consult with Holdings and the Agent before entering into such assignment);
(iii) except in connection with an assignment of all of a Bank's rights and
obligations with respect to its Commitment, Loans and
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L/C Obligations, any such assignment to an Eligible Assignee that is not a Bank
hereunder shall be equal to or greater than $5,000,000; and (iv) each such
partial assignment shall be of a ratable part of the Loans, the Commitment and
the other interests, rights and obligations hereunder of such assigning Bank;
and provided further, however, that Holdings and the Agent may continue to deal
solely and directly with such Bank in connection with the interest so assigned
to an Assignee until (A) such Bank and its Assignee shall have delivered to
Holdings and the Agent an Assignment and Acceptance Agreement substantially in
the form of Exhibit E ("Assignment and Acceptance"), together with any Note or
Notes subject to such assignment; (B) a written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, in substantially the form of the Notice of Assignment
and Acceptance attached as Schedule 1 to the Assignment and Acceptance, shall
have been given to Holdings and the Agent by such Bank and the Assignee; (C) the
assignor Bank or Assignee shall have paid to the Agent a processing fee in the
amount of $4,000 and (D) the Agent, Holdings, the Issuing Bank and the Swingline
Bank each shall have provided any required consent to such assignment in
accordance with this Section. In connection with any assignment by Xxxxx Fargo,
its Swingline Commitment may be assigned in whole (and not part) and only in
connection with an assignment transaction involving an assignment of all of its
Commitment and Loans, and the Assignment and Acceptance may be appropriately
modified to include an assignment and delegation of its Swingline Commitment and
any outstanding Swingline Loans.
(b) From and after the date that the Agent notifies the assignor
Bank that the Agent has received (and, if required, provided its consent with
respect thereto and received any other consents required under this Section
11.08) 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, (ii) 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, and
(iii) 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; provided, however, that the assignor
Bank shall not relinquish its rights under Article IV or under Sections 11.04
and 11.05 to the extent such rights relate to the time prior to the effective
date of the Assignment and Acceptance. The Commitment allocated to each Assignee
shall reduce the Commitment of the assigning Bank pro tanto.
(c) Within five Business Days after Holding's receipt of notice by
the Agent that it has received (and, if necessary, consented to) an executed
Assignment and Acceptance and payment of the processing fee (and provided that
the Issuing Bank, the Swingline Bank and Holdings each consent to such
assignment in accordance with subsection 11.08(a)), Holdings shall execute and
deliver to the Agent any new Note requested by such Assignee 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 as requested by the
assignor Bank evidencing the Loans and Commitment retained by the assignor Bank
(such Note to be in exchange for, but not in payment of, the Note held by such
Bank, if any).
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(d) Any Bank may at any time sell to one or more commercial banks or
other Persons not Affiliates of Holdings (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) Holdings, the Issuing
Bank 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 11.01. In the case of any such
participation, the Participant shall be entitled to the benefit of Sections
4.01, 4.03 and 11.05 as though it were also a Bank hereunder, and 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.
(e) 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 any Note held by it (other
than in respect of Swingline Loans) in favor of any Federal Reserve Bank in
accordance with Regulation A of the FRB or U.S. Treasury Regulation 31 C.F.R.
ss.203.14, and such Federal Reserve Bank may enforce such pledge or security
interest in any manner permitted under applicable law.
11.09 Confidentiality. Each 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 information identified as "confidential" or
"secret" by Holdings or the Company and provided to it by Holdings, the Company
or any Subsidiary, or by the Agent on Holdings', 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 Holdings, 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 such Bank, or (ii) was or becomes available on a
non-confidential basis from a source other than Holdings or the Company,
provided that such source is not bound by a confidentiality agreement with
Holdings or the Company known to such 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 such 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, legal counsel and
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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 Holdings, the Company
or any Subsidiary is party or is deemed party with such Bank or such Affiliate;
and (I) to its Affiliates.
11.10 Set-off. In 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 any Loan Party, any such notice being waived by such Loan Party
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 such Loan Party 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 such Loan Party 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.
NOTWITHSTANDING THE FOREGOING, NO BANK SHALL EXERCISE, OR ATTEMPT TO EXERCISE,
ANY RIGHT OF SET-OFF, BANKER'S LIEN, OR THE LIKE, AGAINST ANY DEPOSIT ACCOUNT OR
PROPERTY OF HOLDINGS OR ANY SUBSIDIARY OF HOLDINGS HELD OR MAINTAINED BY THE
BANK WITHOUT THE UNANIMOUS PRIOR WRITTEN CONSENT OF THE BANKS.
11.11 [Intentionally omitted.]
11.12 Guaranty. (a) Guaranty. Each of the Guarantors unconditionally and
irrevocably, jointly and severally guarantees to the Agent, the Lead Arranger
and the Banks, and their respective successors, endorsers, transferees and
assigns (the "Guaranteed Persons"), the full and prompt payment when due
(whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise) and performance of all indebtedness, liabilities and other
obligations of Holdings to any Guaranteed Person, whether arising out of or in
connection with this Agreement, any other Loan Document or otherwise, including
all unpaid principal of the Loans, all L/C Obligations, all interest accrued
thereon, all fees due under this Agreement and all other amounts payable by
Holdings to any Guaranteed Person thereunder or in connection therewith. The
terms "indebtedness," "liabilities" and "obligations" are used herein in their
most comprehensive sense and include any and all advances, debts, obligations
and liabilities, now existing or hereafter arising, whether voluntary or
involuntary and whether due or not due, absolute or contingent, liquidated or
unliquidated, determined or undetermined, and whether recovery upon such
indebtedness, liabilities and obligations may be or hereafter become
unenforceable or shall be an allowed or disallowed claim under the Bankruptcy
Code or other applicable law. The foregoing indebtedness, liabilities and other
obligations of Holdings shall hereinafter be collectively referred to as the
"Guaranteed Obligations." The Guaranteed Obligations include interest which, but
for an Insolvency Proceeding, would have accrued on such Guaranteed Obligations,
whether or not a claim is allowed against Holdings for such interest in any such
Insolvency Proceeding.
97
(b) Separate Obligation. Each Guarantor acknowledges and agrees (i)
that the Guaranteed Obligations are separate and distinct from any indebtedness,
obligations or liabilities arising under or in connection with any other
agreement, instrument or guaranty, including under any provision of this
Agreement other than this Section 11.12, executed at any time by such Guarantor
in favor of any Guaranteed Person, and (ii) such Guarantor shall pay and perform
all of the Guaranteed Obligations as required under this Section 11.12, and each
Guaranteed Person may enforce any and all of its rights and remedies hereunder,
without regard to any other agreement, instrument or guaranty, including any
provision of this Agreement other than this Section 11.12, at any time executed
by such Guarantor in favor of any Guaranteed Person, regardless of whether or
not any such other agreement, instrument or guaranty, or any provision thereof
or hereof, shall for any reason become unenforceable or any of the indebtedness,
obligations or liabilities thereunder shall have been discharged, whether by
performance, avoidance or otherwise. Each Guarantor acknowledges that in
providing benefits to Holdings and such Guarantor, the Guaranteed Persons are
relying upon the enforceability of this Section 11.12 and the Guaranteed
Obligations as separate and distinct indebtedness, obligations and liabilities
of such Guarantor, and each Guarantor agrees that each Guaranteed Person would
be denied the full benefit of their bargain if at any time this Section 11.12 or
the Guaranteed Obligations were treated any differently. The fact that the
Guaranty of each Guarantor is set forth in this Agreement rather than in a
separate guaranty document is for the convenience of Holdings and the Guarantors
and shall in no way impair or adversely affect the rights or benefits of any
Guaranteed Person under this Section 11.12. Each Guarantor agrees to execute and
deliver a separate agreement, immediately upon request at any time of any
Guaranteed Person, evidencing such Guarantor's obligations under this Section
11.12. Upon the occurrence of any Event of Default, a separate action or actions
may be brought against each Guarantor, whether or not Holdings or any other
Guarantor or Person is joined therein or a separate action or actions are
brought against Holdings or any other Guarantor or Person.
(c) Limitation of Guaranty. To the extent that any court of
competent jurisdiction shall impose by final judgment under applicable law
(including the California Uniform Fraudulent Transfer Act and ss.ss.544 and 548
of the Bankruptcy Code) any limitations on the amount of any Guarantor's
liability with respect to the Guaranteed Obligations which any Guaranteed Person
can enforce under this Section 11.12, each Guaranteed Person by its acceptance
hereof accepts such limitation on the amount of such Guarantor's liability
hereunder to the extent needed to make this Section 11.12 fully enforceable and
nonavoidable.
(d) Liability of Guarantor. The liability of each Guarantor under
this Section 11.12 shall be irrevocable, absolute, independent and
unconditional, and shall not be affected by any circumstance which might
constitute a discharge of a surety or guarantor other than the indefeasible
payment and performance in full of all Guaranteed Obligations. In furtherance of
the foregoing and without limiting the generality thereof, each Guarantor agrees
as follows:
(i) such Guarantor's liability hereunder shall be the immediate,
direct, and primary obligation of such Guarantor and shall not be contingent
upon any Guaranteed Person's exercise or enforcement of any remedy it may have
against Holdings or any other Person, or against any collateral or other
security for any Guaranteed Obligations;
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(ii) this Guaranty is a guaranty of payment when due and not merely
of collectibility;
(iii) such Guarantor's payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge such
Guarantor's liability for any portion of the Guaranteed Obligations remaining
unsatisfied; and
(iv) such Guarantor's liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard to, and shall
not be impaired or affected by, nor shall such Guarantor be exonerated or
discharged by, any of the following events:
(A) any Insolvency Proceeding;
(B) any limitation, discharge, or cessation of the liability
of Holdings or any other guarantor or Person for any Guaranteed Obligations due
to any statute, regulation or rule of law, or any invalidity or unenforceability
in whole or in part of any of the Guaranteed Obligations or the Loan Documents;
(C) any merger, acquisition, consolidation or change in
structure of Holdings or any other Guarantor or Person, or any sale, lease,
transfer or other disposition of any or all of the assets or shares of Holdings
or any other Guarantor or other Person;
(D) any assignment or other transfer, in whole or in part, of
any Guaranteed Person's interests in and rights under this Guaranty or the other
Loan Documents;
(E) any claim, defense, counterclaim or set-off, other than
that of prior performance, that Holdings, such Guarantor, any other guarantor or
other Person may have or assert, including any defense of incapacity or lack of
corporate or other authority to execute any of the Loan Documents;
(F) any Guaranteed Person's amendment, modification, renewal,
extension, cancellation or surrender of any Loan Document or any Guaranteed
Obligations;
(G) any Guaranteed Person's exercise or nonexercise of any
power, right or remedy with respect to any Guaranteed Obligations or any
collateral;
(H) any Guaranteed Person's vote, claim, distribution,
election, acceptance, action or inaction in any Insolvency Proceeding; or
(I) any other guaranty, whether by any Guarantor or any other
Person, of all or any part of the Guaranteed Obligations or any other
indebtedness, obligations or liabilities of any Guaranteed Person.
(e) Consents of Guarantor. Each Guarantor hereby unconditionally
consents and agrees that, without notice to or further assent from such
Guarantor:
(i) the principal amount of the Guaranteed Obligations may be
increased or decreased and additional indebtedness or obligations of Holdings
under the Loan Documents
99
may be incurred and the time, manner, place or terms of any payment under any
Loan Document be extended or changed, by one or more amendments, modifications,
renewals or extensions of any Loan Document or otherwise;
(ii) the time for Holdings' (or any other Person's) performance of
or compliance with any term, covenant or agreement on its part to be performed
or observed under any Loan Document may be extended, or such performance or
compliance waived, or failure in or departure from such performance or
compliance consented to, all in such manner and upon such terms as any
Guaranteed Person (or the Majority Banks, as the case may be) may deem proper;
(iii) each Guaranteed Person may request and accept other guarantees
and may take and hold other security as collateral for the Guaranteed
Obligations, and may, from time to time, in whole or in part, exchange, sell,
surrender, release, subordinate, modify, waive, rescind, compromise or extend
such other guaranties or security and may permit or consent to any such action
or the result of any such action, and may apply such security and direct the
order or manner of sale thereof;
(iv) each Guaranteed Person may exercise, or waive or otherwise
refrain from exercising, any other right, remedy, power or privilege even if the
exercise thereof affects or eliminates any right of subrogation or any other
right of such Guarantor against Holdings.
(f) Guarantor's Waivers. Each Guarantor waives and agrees not to
assert:
(i) any right to require the Agent, the Issuing Bank or any Bank to
marshal assets in favor of Holdings, the Guarantors, any other guarantor or any
other Person, to proceed against Holdings, any other guarantor or any other
Person, to proceed against or exhaust any of the Collateral, to give notice of
the terms, time and place of any public or private sale of personal property
security constituting the Collateral or other collateral for the Guaranteed
Obligations or comply with any other provisions of ss.9504 of the UCC (or any
equivalent provision of any other applicable law) or to pursue any other right,
remedy, power or privilege of the Agent, the Issuing Bank or any Bank
whatsoever;
(ii) the defense of the statute of limitations in any action
hereunder or for the collection or performance of the Guaranteed Obligations;
(iii) any defense arising by reason of any lack of corporate or
other authority or any other defense of Holdings, such Guarantor or any other
Person;
(iv) any defense based upon any Guaranteed Person's errors or
omissions in the administration of the Guaranteed Obligations;
(v) any rights to set-offs and counterclaims;
(vi) without limiting the generality of the foregoing, to the
fullest extent permitted by law, any defenses or benefits that may be derived
from or afforded by applicable law limiting the liability of or exonerating
guarantors or sureties, or which may conflict with the terms of this Section
11.12;
100
(vii) any defense based upon an election of remedies (including, if
available, an election to proceed by nonjudicial foreclosure) which destroys or
impairs the subrogation rights of such Guarantor or the right of such Guarantor
to proceed against Holdings or any other obligor of the Guaranteed Obligations
for reimbursement;
(viii) without limiting the generality of the foregoing, to the
fullest extent permitted by law, any defenses or benefits that may be derived
from or afforded by applicable law limiting the liability of or exonerating
guarantors or sureties, or which may conflict with the terms of this Section
11.12, including any and all benefits that otherwise might be available to such
Guarantor under California Civil Code ss.ss.1432, 2809, 2810, 2815, 2819, 2839,
2845, 2848, 2849, 2850, 2899 and 3433 and California Code of Civil Procedure
ss.ss.580a, 580b, 580d and 726 or Texas Property Code ss.ss.51.003 - 51.005.
Accordingly, each Guarantor waives all rights and defenses that such Guarantor
may have because Holdings' debt is secured by real property. This means, among
other things: (A) the Agent, the Issuing Bank and the Banks may collect from
such Guarantor without first foreclosing on any real or personal property
Collateral pledged by Holdings or such Guarantor; and (B) if the Agent
forecloses on any real property Collateral pledged by Holdings or such
Guarantor: (1) the amount of the debt may be reduced only by the price for which
that Collateral is sold at the foreclosure sale, even if the Collateral is worth
more than the sale price, and (2) the Agent, the Issuing Bank and the Banks may
collect from such Guarantor even if the Agent, by foreclosing on the real
property Collateral, has destroyed any right such Guarantor may have to collect
from Holdings. This is an unconditional and irrevocable waiver of any rights and
defenses such Guarantor may have because Holdings' debt is secured by real
property. These rights and defenses include, but are not limited to, any rights
of defenses based upon Section 580a, 580b, 580d or 726 of the California Code of
Civil Procedure or Sections 51.003 - 51.005 of the Texas Property Code; and
(ix) any and all notice of the acceptance of this Guaranty, and any
and all notice of the creation, renewal, modification, extension or accrual of
the Guaranteed Obligations, or the reliance by any Guaranteed Person upon this
Guaranty, or the exercise of any right, power or privilege hereunder. The
Guaranteed Obligations shall conclusively be deemed to have been created,
contracted, incurred and permitted to exist in reliance upon this Guaranty. Each
Guarantor waives promptness, diligence, presentment, protest, demand for
payment, notice of default, dishonor or nonpayment and all other notices to or
upon Holdings, such Guarantor or any other Person with respect to the Guaranteed
Obligations.
(g) Financial Condition of Holdings. No Guarantor shall have any
right to require any Guaranteed Person to obtain or disclose any information
with respect to: the financial condition or character of Holdings or the ability
of Holdings to pay and perform the Guaranteed Obligations; the Guaranteed
Obligations; any collateral or other security for any or all of the Guaranteed
Obligations; the existence or nonexistence of any other guarantees of all or any
part of the Guaranteed Obligations; any action or inaction on the part of any
Guaranteed Person or any other Person; or any other matter, fact or occurrence
whatsoever. Each Guarantor hereby acknowledges that it has undertaken its own
independent investigation of the financial condition of Holdings and the other
Loan Parties and all other matters pertaining to this Guaranty and further
acknowledges that it is not relying in any manner upon any representation or
statement of any Guaranteed Person with respect thereto.
101
(h) Subrogation. Until the Guaranteed Obligations shall be satisfied
in full and the Commitments shall be terminated, each Guarantor shall not have,
and shall not directly or indirectly exercise (i) any rights that it may acquire
by way of subrogation under this Section 11.12, by any payment hereunder or
otherwise, (ii) any rights of contribution, indemnification, reimbursement or
similar suretyship claims arising out of this Section 11.12 or (iii) any other
right which it might otherwise have or acquire (in any way whatsoever) which
could entitle it at any time to share or participate in any right, remedy or
security of any Guaranteed Person as against Holdings or other guarantors,
whether in connection with this Section 11.12, any of the other Loan Documents
or otherwise. If any amount shall be paid to any Guarantor on account of the
foregoing rights at any time when all the Guaranteed Obligations shall not have
been paid in full, such amount shall be held in trust for the benefit of each
Guaranteed Person and shall forthwith be paid to the Agent to be credited and
applied to the Guaranteed Obligations, whether matured or unmatured, in
accordance with the terms of the Loan Documents.
(i) Continuing Guaranty. This Guaranty is a continuing guaranty and
agreement of subordination and shall continue in effect and be binding upon each
Guarantor until termination of the Commitments and payment and performance in
full of all Guaranteed Obligations, including Guaranteed Obligations which may
exist continuously or which may arise from time to time under successive
transactions, and each Guarantor expressly acknowledges that this Guaranty shall
remain in full force and effect notwithstanding that there may be periods in
which no Guaranteed Obligations exist.
(j) Reinstatement. This Guaranty shall continue to be effective or
shall be reinstated and revived, as the case may be, if, for any reason, any
payment of the Guaranteed Obligations by or on behalf of Holdings (or receipt of
any proceeds of collateral) shall be rescinded, invalidated, declared to be
fraudulent or preferential, set aside, voided or otherwise required to be repaid
to Holdings, its estate, trustee, receiver or any other Person (including under
the Bankruptcy Code or other state or federal law), or must otherwise be
restored by any Guaranteed Person, whether as a result of Insolvency Proceedings
or otherwise. All losses, damages, costs and expenses that any Guaranteed Person
may suffer or incur as a result of any voided or otherwise set aside payments
shall be specifically covered by the indemnity in favor of the Banks and the
Agent contained in Section 11.05.
(k) Substantial Benefits. The funds that have been borrowed from the
Banks by Holdings have been and are to be contemporaneously used for the direct
or indirect benefit of Holdings and each Guarantor. It is the position, intent
and expectation of the parties that Holdings and each Guarantor have derived and
will derive significant and substantial direct or indirect benefits from the
accommodations that have been made by the Banks under the Loan Documents.
(l) Knowing and Explicit Waivers. EACH GUARANTOR ACKNOWLEDGES THAT
IT EITHER HAS OBTAINED THE ADVICE OF LEGAL COUNSEL OR HAS HAD THE OPPORTUNITY TO
OBTAIN SUCH ADVICE IN CONNECTION WITH THE TERMS AND PROVISIONS OF THIS SECTION
11.12. EACH GUARANTOR ACKNOWLEDGES AND AGREES THAT EACH OF THE WAIVERS AND
CONSENTS SET FORTH HEREIN ARE MADE WITH FULL KNOWLEDGE OF THEIR SIGNIFICANCE AND
CONSEQUENCES, AND THAT ALL SUCH WAIVERS AND CONSENTS HEREIN ARE
102
EXPLICIT AND KNOWING AND WHICH EACH GUARANTOR EXPECTS TO BE FULLY ENFORCEABLE.
(m) Release of Subsidiary Guarantors. Holdings may at any time
deliver to the Agent a certificate from a Responsible Officer of Holdings
certifying as of the date of the certificate that, after the consummation of the
transaction or series of transactions described in such certificate (which
certification shall also state that such transactions, individually or in the
aggregate, will be in compliance with the terms and conditions of this
Agreement, including to the extent applicable Sections 8.02 and 8.03, and that
no Event of Default existed, exists or will exist, as the case may be,
immediately before, as a result of or immediately after giving effect to such
transaction or transactions and termination), the Guarantor identified in such
certification will no longer be a Subsidiary of Holdings. Effective upon the
consummation of the transaction or series of transactions described in such
certificate, the Subsidiary identified in such certification shall thereupon
automatically cease to be a Guarantor hereunder and shall cease to be a party
hereto and shall thereupon automatically be released from its obligations under
this Section 11.12 and under the Security Agreement, and all Liens in favor of
the Agent and the Banks under the Collateral Documents in respect of the
property of such Subsidiary shall thereupon terminate. Holdings shall promptly
notify the Agent of the consummation of any such transaction or series of
transactions. The Agent, on behalf of the Banks, shall, at Holdings' expense,
execute and deliver such instruments as Holdings may reasonably request to
evidence such release and Lien termination.
11.13 Notification of Addresses, Lending Offices, Etc. Each Bank shall
notify the Agent in writing of any changes in the address to which notices to
such 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.
11.14 Counterparts. This 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.
11.15 Severability. The 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.
11.16 No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of Holdings, the Company, the Banks,
the Agent and the Agent-Related Persons, the Indemnified 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.
11.17 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND ANY 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.
103
(b) 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 SITTING IN THE STATE OF CALIFORNIA, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE LOAN PARTIES, 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 LOAN PARTIES, 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 LOAN PARTIES, 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.
(c) Nothing contained in this Section shall override any contrary
provision contained in any Specified Swap Contract.
11.18 Waiver of Jury Trial. THE LOAN PARTIES, 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 LOAN PARTIES,
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.
11.19 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Loan
Parties, the Issuing Bank, the Swingline Bank, 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.
(remainder of page intentionally left blank)
104
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.
BUILDING MATERIALS HOLDING CORPORATION
By:_______________________
Title:____________________
BMC WEST CORPORATION
By:_______________________
Title:____________________
BMC WEST CORPORATION SOUTHCENTRAL
By:_______________________
Title:____________________
BMCW SOUTHCENTRAL, L.P.
By: BMC WEST CORPORATION
SOUTHCENTRAL, its General Partner
By:_______________________
Title:____________________
BMCW, LLC
By:_______________________
Title:____________________
BMC FRAMING, INC. (formerly known as BMHC
FRAMING, INC.)
By:_______________________
Title:____________________
XXXXX BROTHERS INDUSTRIES, LLC
By: BMC Framing, Inc., its Managing Member
By:_______________________
Title:____________________
KB INDUSTRIES LIMITED PARTNERSHIP
By: BUILDING MATERIALS HOLDING CORPORATION,
its General Partner
By:_______________________
Title:____________________
XXXXX FARGO BANK, N.A.,
as Agent, Issuing Bank, Swingline Bank and a Bank
By:_______________________
Title:____________________
FIRST UNION NATIONAL BANK,
as Syndication Agent and a Bank
By:_______________________
Title:____________________
2
U.S. BANK NATIONAL ASSOCIATION
By:_______________________
Title:____________________
UNION BANK OF CALIFORNIA, N.A.
By:_______________________
Title:____________________
COMERICA WEST INCORPORATED
By:_______________________
Title:____________________
WASHINGTON MUTUAL BANK DBA WM BUSINESS BANK
By:_______________________
Title:____________________
BNP PARIBAS
By:_______________________
Title:____________________
XXXXXX TRUST AND SAVINGS BANK
By:_______________________
Title:____________________
3
GUARANTY BANK
By:_______________________
Title:____________________
WEST COAST BANK
By:_______________________
Title:____________________
BANK LEUMI USA
By:_______________________
Title:____________________
4
SCHEDULE 2.01
COMMITMENTS AND PRO RATA SHARES
-------------------------------------------------------------------------------------------------------------------------
Pro Rata Share Pro Rata Share
Banks Term Commitment Revolving Commitment (Term Commitment) (Revolving Commitment)
-------------------------------------------------------------------------------------------------------------------------
Xxxxx Fargo Bank, $27,500,000.00 $47,500,000.00 26.55% 26.55%
N.A.
-------------------------------------------------------------------------------------------------------------------------
First Union
National Bank $14,666,666.67 $25,333,333.33 14.16% 14.16%
-------------------------------------------------------------------------------------------------------------------------
U.S. Bank National
Association $9,166,666.67 $15,833,333.33 8.85% 8.85%
-------------------------------------------------------------------------------------------------------------------------
Union Bank of
California, N.A. $9,166,666.67 $15,833,333.33 8.85% 8.85%
-------------------------------------------------------------------------------------------------------------------------
Comerica West
Incorporated $7,333,333.33 $12,666,666.67 7.08% 7.08%
-------------------------------------------------------------------------------------------------------------------------
Washington Mutual
Bank dba WM
Business Bank $7,333,333.33 $12,666,666.67 7.08% 7.08%
-------------------------------------------------------------------------------------------------------------------------
BNP Paribas $5,500,000.00 $9,500,000.00 5.31% 5.31%
-------------------------------------------------------------------------------------------------------------------------
Xxxxxx Trust and
Savings Bank $9,166,666.66 $15,833,333.34 8.85% 8.85%
-------------------------------------------------------------------------------------------------------------------------
Guaranty Bank $5,500,000.00 $9,500,000.00 5.31% 5.31%
-------------------------------------------------------------------------------------------------------------------------
West Coast Bank $5,500,000.00 $9,500,000.00 5.31% 5.31%
-------------------------------------------------------------------------------------------------------------------------
Bank Leumi USA $2,750,000.00 $4,750,000.00 2.65% 2.65%
-------------------------------------------------------------------------------------------------------------------------
TOTAL $103,583,333.33 $178,916,666.67 100% 100%
-------------------------------------------------------------------------------------------------------------------------
SCHEDULE 2.09
TERM LOAN AMORTIZATION SCHEDULE
----------------------------------------------------------------------------------------------
Date % of Total Due Payment Due Based on Payment Due Assuming
Aggregate Term Advancement of Maximum
Commitment as of Allowable Additional Term
Effective Date Loans as of Subsequent
Effective Date
==============================================================================================
----------------------------------------------------------------------------------------------
9/30/01 0.0% $0 $0
----------------------------------------------------------------------------------------------
12/31/01 0.0% $0 $0
==============================================================================================
----------------------------------------------------------------------------------------------
3/31/02 0.0% $0 $0
----------------------------------------------------------------------------------------------
6/30/02 0.0% $0 $0
----------------------------------------------------------------------------------------------
9/30/02 3.0% $3,107,500.00 $3,300,000
----------------------------------------------------------------------------------------------
12/31/02 4.0% $4,143,333.33 $4,400,000
==============================================================================================
----------------------------------------------------------------------------------------------
3/31/03 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
6/30/03 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
9/30/03 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
12/31/03 4.0% $4,143,333.33 $4,400,000
==============================================================================================
----------------------------------------------------------------------------------------------
3/31/04 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
6/30/04 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
9/30/04 4.0% $4,143,333.33 $4,400,000
----------------------------------------------------------------------------------------------
12/1/04 65.0% $67,329,166.69 $71,500,000
==============================================================================================
----------------------------------------------------------------------------------------------
12/1/04 100.00% $103,583,333.33 $110,000,000
----------------------------------------------------------------------------------------------
SCHEDULE 11.02
PAYMENT OFFICES; ADDRESSES FOR NOTICES;
LENDING OFFICES
BUILDING MATERIALS HOLDING CORPORATION
Address for Notices:
Building Materials Holding Corporation
Xxx Xxxxxx Xxxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx, Senior Vice President of Finance and Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
With a copy to:
Xxxx X. Street, Esq.
Senior Vice President, General Counsel & Secretary
BMC West Corporation
000 Xxxx Xxxxxxxxx, Xxxxx 000
X.X. Xxx 00000
Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
Xxxx X. Xxxxxx
Assistant Treasurer
Building Materials Holding Corporation
Xxx Xxxxxx Xxxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
GUARANTORS
Address for Notices:
c/o Building Materials Holding Corporation
Xxx Xxxxxx Xxxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx, Senior Vice President of Finance and Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
With a copy to:
Xxxx X. Street, Esq.
Senior Vice President, General Counsel & Secretary
BMC West Corporation
000 Xxxx Xxxxxxxxx, Xxxxx 000
X.X. Xxx 00000
Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
Xxxx X. Xxxxxx
Assistant Treasurer
Building Materials Holding Corporation
Xxx Xxxxxx Xxxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
XXXXX FARGO BANK, N.A., as Agent
Notices for Borrowing, Conversions/Continuations, and Payments:
Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxxx, 0xx Xxxxx
MAC X0000-000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
2
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxx.xxx
Other Notices:
Xxxxx Fargo Bank, N.A.
000 Xxxxxxxxxx Xxxxxx
MAC A0101-096
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxx@xxxxxxxxxx.xxx
Agent's Payment Office:
Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxxx, 0xx Xxxxx
MAC X0000-000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Reference: Building Materials Holding
For credit to Acct. No. 41219-02167
ABA No. 000000000
XXXXX FARGO BANK, N.A., as Issuing Bank
Address for Notices:
Xxxxx Fargo Bank, N.A.
000 Xxxxxxxxxx Xxxxxx
MAC A0101-096
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxx@xxxxxxxxxx.xxx
XXXXX FARGO BANK, N.A., as Swingline Bank
3
Domestic and Offshore Lending Office:
Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxxx, 0xx Xxxxx
MAC X0000-000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxx.xxx
XXXXX FARGO BANK, N.A., as a Bank
Domestic and Offshore Lending Office:
Xxxxx Fargo Bank, N.A.
000 Xxxxx Xxxxxx, 0xx Xxxxx
MAC X0000-000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Xxxxx Fargo Bank, N.A.
000 Xxxxxxxxxx Xxxxxx
MAC A0101-096
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxx@xxxxxxxxxx.xxx
COMERICA WEST INCORPORATED
Domestic and Offshore Lending Office:
Comerica West Incorporated
0000 Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxxxx X. XxXxxxx
4
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx_x_xxxxxxx@xxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Comerica West Incorporated
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxx_x_xxxxxx@xxxxxxxx.xxx
FIRST UNION NATIONAL BANK
Domestic and Offshore Lending Office:
First Union National Bank
000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx.xxxxxxxx@xxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
First Union National Bank
000 X. Xxxxxxx Xxxxxx, XX-0
Xxxxxxxxx, XX 00000-0000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxx.xxxxxx@xxxx.xxx
U.S. BANK NATIONAL ASSOCIATION
Domestic and Offshore Lending Office:
U.S. Bank National Association
000 XX Xxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
5
Facsimile: (000) 000-0000
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
U.S. Bank National Association
000 Xxxxx Xxxxxxx Xxxx.
Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxx.xxxxxx@xxxxxx.xxx
UNION BANK OF CALIFORNIA, N.A.
Domestic and Offshore Lending Office:
Union Bank of California, N.A.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000 or (000)000-0000
Email: xxxxxxx.xxxxx@xxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxx.xxxxxxx@xxxx.xxx
WASHINGTON MUTUAL BANK, DBA WM BUSINESS BANK
Domestic and Offshore Lending Office:
WM Business Bank
Business Banking Center
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
6
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
WM Business Bank
Business Banking Center
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx_xxxx@xxxxx.xxx
BNP PARIBAS
Domestic and Offshore Lending Office:
BNP Paribas
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
BNP Paribas
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Backup contact:
BNP Paribas
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxxxxxx@xxxxxxxx.xxxxxxxxxx.xxx
7
XXXXXX TRUST AND SAVINGS BANK
Domestic and Offshore Lending Office:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx, 0X
Xxxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx.xxxxxxxx@xxx.xxx
GUARANTY BANK
Domestic and Offshore Lending Office:
Guaranty Bank
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxx
Telephone: (000) 000-000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx.xxxxxxxx@xxxxxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Guaranty Bank
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxx.xxxx@xxxxxxxxxxxxx.xxx
0
XXXX XXXXX XXXX
Xxxxxxxx xxx Xxxxxxxx Xxxxxxx Office:
West Coast Bank
X.X. Xxx 0000
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
West Coast Bank
000 Xxxxxx Xxxxxx XX
X.X. Xxx 000
Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxx.xxx
BANK LEUMI USA
Domestic and Offshore Lending Office:
Bank Leumi USA
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxxxx.xxx
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Bank Leumi USA
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxxx@xxxxxxxxxxxx.xxx
9
ANNEX I
PRICING GRID
From the Effective Date until the date six months after the Effective Date
(the "Initial Period"), the Applicable Margin and the Applicable Fee Amount
shall be at Level 2 or higher. Thereafter, the Applicable Margin and the
Applicable Fee Amount for any day shall be the amount per annum set forth below
based on the EBITDA Ratio set forth in the most recently delivered Compliance
Certificate delivered by Holdings pursuant to Section 7.02(c) of the Credit
Agreement. Changes in the Applicable Margin and the Applicable Fee Amount
resulting from a change in the EBITDA Ratio shall become effective on the date
of delivery by Holdings to the Agent of a new Compliance Certificate pursuant to
Section 7.02(c), except that no such change shall take effect until the end of
the Initial Period. If Holdings shall fail to deliver a Compliance Certificate
and accompanying financial statements within the number of days after the end of
any fiscal quarter or fiscal year as required pursuant to Section 7.02(c), the
parties agree that the Applicable Margin and the Applicable Fee Amount shall be
fixed at Level 4 until such time as Holdings delivers such new Compliance
Certificate and accompanying financial statements pursuant to Section 7.02(c).
======================================================================================================================
Offshore Rate Letter of
Level EBITDA Ratio Spread Base Rate Spread Credit Fee Commitment Fee
======================================================================================================================
Level 4 greater than 3.50 to 3.00% 1.50% 3.00% 0.50%
1
----------------------------------------------------------------------------------------------------------------------
Level 3 greater than 3.00 to 2.75% 1.25% 2.75% 0.50%
1 but less than or
equal to 3.50 to 1
----------------------------------------------------------------------------------------------------------------------
Level 2 greater than 2.50 to 2.50% 1.00% 2.50% 0.50%
1 but less than or
equal to 3.00
to 1
----------------------------------------------------------------------------------------------------------------------
Level 1 less than or equal 2.00% 0.50% 2.00% 0.375%
to 2.50 to 1
----------------------------------------------------------------------------------------------------------------------
Execution Copy
RESIGNATION, ASSIGNMENT AND ACCEPTANCE AGREEMENT
This Resignation, Assignment and Acceptance Agreement (this "Agreement"),
dated as of August 30, 2001, is entered into by and between Bank of America,
N.A., a national banking association ("BofA"), and Xxxxx Fargo Bank, National
Association, a national banking association ("Xxxxx Fargo").
RECITALS
A. Reference is made to (a) that certain Credit Agreement, dated as of
November 30, 1999 (as amended, supplemented or otherwise modified through the
date hereof, the "Original Credit Agreement") among (i) Building Materials
Holding Corporation, a Delaware corporation ("Holdings"), (ii) BMC West
Corporation, a Delaware corporation (the "Company"), and certain other
affiliates of Holdings, as guarantors, (iii) the several financial institutions
from time to time party to the Original Credit Agreement (collectively, the
"Original Banks") and (iv) BofA, as letter of credit issuing bank (in such
capacity, the "Original L/C Issuer") and swingline bank (in such capacity, the
"Original Swingline Lender") and as administrative agent for the Original Banks
(in such capacity as administrative agent for the Original Banks under the
Original Credit Agreement, the "Original Agent"); and (b) that certain Amended
and Restated Credit Agreement, to be dated as of the date hereof (the "Amended
Credit Agreement"), among (i) Holdings, (ii) the Company, and certain other
affiliates of Holdings, as guarantors, (iii) the several financial institutions
from time to time party to such Amended Credit Agreement (collectively, the "New
Banks") and (iv) Xxxxx Fargo, as letter of credit issuing bank (in such
capacity, the "New Issuing Bank") and swingline bank (in such capacity, the "New
Swingline Lender"), and as administrative agent for the New Banks (in such
capacity as administrative agent for the New Banks under the Amended Credit
Agreement, the "Successor Agent"). Unless otherwise defined herein, terms used
herein shall have the meanings given to them in the Original Credit Agreement.
B. Holdings has requested the Original Banks to amend and restate the
Original Credit Agreement in certain respects. Immediately prior to, and in
connection with, such amendment and restatement, BofA has agreed to resign as
Agent under the Original Credit Agreement and Xxxxx Fargo has agreed to replace
BofA as Agent under the Original Credit Agreement, whereupon the Original Credit
Agreement shall be amended and restated in its entirety pursuant to the Amended
Credit Agreement.
C. In order to effectuate such resignation and replacement, BofA and Xxxxx
Fargo have agreed to enter into this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, BofA and Xxxxx Fargo hereby agree as follows:
1
1. Resignation. BofA hereby provides notice to the Original Banks that,
effective as of the Effective Time, it hereby resigns as Agent under the
Original Credit Agreement, and the Original Banks, Holdings, the Company and the
other Loan Parties hereby accept such resignation. Effective as of the Effective
Time, BofA shall be discharged from its duties and obligations as Agent under
the Original Credit Agreement for matters arising from and after the Effective
Time, provided that the provisions of Section 4.01, Article X and Sections 11.04
and 11.05 of the Original Credit Agreement shall survive and continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Agent under the Original Credit Agreement.
2. Successor Agent. Effective as of the Effective Time, Xxxxx Fargo shall
succeed to and become vested with all the rights, powers, privileges and duties
of BofA as Agent under the Original Credit Agreement and all other Loan
Documents (including, without limitation, the Security Agreement, the
Intellectual Property Security Agreement and the Mortgages) (collectively, the
"Assigned Interests"). The Original Banks, Holdings, the Company and the other
Loan Parties hereby consent to such succession.
3. Representations of Original Agent. BofA (a) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Original Credit
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Original Credit
Agreement, any other Loan Document, any other instrument or document furnished
pursuant thereto, or any Collateral other than that it has not created any
adverse claim upon the Assigned Interests except as provided in the Loan
Documents and that the Assigned Interests are free and clear of any such adverse
claim; and (b) makes no representation or warranty and assumes no responsibility
with respect to the solvency or financial condition of Holdings, the Company,
any other Loan Party, any other guarantor or any other obligor or the
performance or observance by Holdings, the Company, any other Loan Party, any
other guarantor or any other obligor of any of their respective obligations
under the Original Credit Agreement or any other Loan Document or any other
instrument or document furnished pursuant hereto or thereto.
4. Representations of Successor Agent. Xxxxx Fargo (a) represents and
warrants that it is legally authorized to enter into this Agreement and is a
permitted successor agent under Section 10.09 of the Original Credit Agreement;
(b) confirms that it has received copies of the Loan Documents and such other
documents and information as it has deemed appropriate to make its own decision
to enter into this Agreement; (c) agrees that it will be bound by the provisions
of the Loan Documents and will perform in accordance with their terms all the
duties and obligations which by the terms of the Loan Documents are required to
be performed by it as Agent from and after the Effective Time; and (d) agrees
that it will, independently and without reliance upon BofA and based on such
documents and information as it shall deem appropriate at the time, make its own
credit and legal decisions in taking or not taking action in its capacity as
Agent under the Original Credit Agreement.
5. Replacement of Issuing Bank and Swingline Bank. Effective as of the
Effective Time, Xxxxx Fargo shall replace BofA as Issuing Bank and Swingline
Bank under the Original Credit Agreement. As of the Effective Time, BofA shall
be discharged from its duties
2
and obligations as Issuing Bank and Swingline Bank under the Original Credit
Agreement and Xxxxx Fargo shall succeed to and become vested with all the
rights, powers, privileges and duties of the Issuing Bank and Swingline Bank
under the Original Credit Agreement. The Original Banks, Holdings, the Company
and the other Loan Parties hereby consent to such replacement of the Issuing
Bank and Swingline Bank. Notwithstanding the foregoing, BofA agrees that the
following letters of credit may remain outstanding, provided that such letters
of credit are supported by one or more back-up letters of credit issued by Xxxxx
Fargo in form and substance satisfactory to BofA: (i) Irrevocable Standby Letter
of Credit Number 3021910 in the face amount of $2,300,000 and (ii) Irrevocable
Standby Letter of Credit Number 3025917 in the face amount of $500,000.
6. Effective Time. The effective time of this Agreement shall be deemed to
occur immediately prior to the closing of the Amended Credit Agreement (the
"Effective Time"), subject to (i) receipt by BofA of a counterpart of this
Agreement duly executed by Xxxxx Fargo, the Original Banks, Holdings, the
Company and the other Loan Parties, and (ii) receipt by BofA, in its capacity as
Original Agent, via wire transfer in immediately available funds, of the amounts
specified on Schedule 1 hereto. Such amounts shall be wired to the Original
Agent to the following account:
BANK OF AMERICA, N.A.
Dallas, Texas
ABA #000000000
For the Account of Credit Services
Account #1292000883
Ref: Building Materials Holding Corp./BMC West Corp.
7. Effect of Assignment. From and after the Effective Time, (a) Xxxxx
Fargo shall be a party to the Original Credit Agreement and the other Loan
Documents as Agent, Issuing Bank and Swingline Bank and shall have the rights,
powers, duties and obligations of the Agent, Issuing Bank and Swingline Bank
under the Original Credit Agreement and the other Loan Documents and shall be
bound by the provisions thereof; and (b) BofA shall relinquish its rights and
powers and be released from its duties and obligations as Agent, Issuing Bank
and Swingline Bank under the Original Credit Agreement and the other Loan
Documents; provided, however, that the provisions of Section 4.01, Article X and
Sections 11.04 and 11.05 of the Original Credit Agreement shall survive and
continue to inure to its benefit as to any actions taken or omitted to be taken
by it under the Original Credit Agreement; and provided, further, that Xxxxx
Fargo shall only be liable for any obligations as Agent, Issuing Bank and
Swingline Bank arising from and after the Effective Time.
8. Receipt of Loan Documents; Further Assurances. Xxxxx Fargo acknowledges
its receipt of all original counterparts of the Loan Documents received by BofA
in its capacity as Agent under the Original Credit Agreement. Each party shall
execute and deliver to the other party all documents and instruments and perform
all acts which the other party may reasonably request in order more fully to
effectuate the assignment and assumption of the Assigned Interests provided for
in this Agreement.
3
9. Miscellaneous. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. No
third party beneficiaries are intended in connection with this Agreement. This
Agreement shall be governed by and construed in accordance with the law of the
State of California. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument. This
Agreement contains the entire and exclusive agreement of the parties hereto with
reference to the matters discussed herein and supersedes all prior drafts and
communications with respect hereto or thereto. This Agreement may not be amended
without the written consent of all parties. If any term or provision of this
Agreement shall be deemed prohibited by or invalid under any applicable law,
such provision shall be invalidated without affecting the remaining provisions
of this Agreement.
[Signature pages follow.]
4
IN WITNESS WHEREOF, the parties hereto have caused this Resignation,
Assignment and Acceptance Agreement to be executed as of the date first above
written by their respective duly authorized officers.
BANK OF AMERICA, N.A., as Original Agent, Original L/C
Issuer, Original Swingline Lender and as an Original
Bank
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
XXXXX FARGO BANK, N.A.
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
The undersigned, representing all of the Original Banks under the Original
Credit Agreement, hereby acknowledge and consent to the foregoing Resignation,
Assignment and Acceptance Agreement, and waive any rights to advance notice of
such resignation, assignment and acceptance as is otherwise required pursuant to
Section 10.09 of the Credit Agreement.
COMERICA WEST INCORPORATED
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
FIRST SECURITY BANK, N.A.
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
FIRST UNION NATIONAL BANK
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
KEYBANK NATIONAL ASSOCIATION
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
SOUTH TRUST BANK, N.A.
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
UNION BANK OF CALIFORNIA, N.A.
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
U.S. BANK NATIONAL ASSOCIATION
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
XXXXX FARGO BANK, N.A.
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
WM BUSINESS BANK A DIVISION OF WASHINGTON MUTUAL
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
BNP PARIBAS
By:
-----------------------------------------------------
Name:
---------------------------------------------------
Title:
--------------------------------------------------
ACKNOWLEDGED AND CONSENTED TO:
BUILDING MATERIALS HOLDING CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
BMC WEST CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
BMC WEST CORPORATION SOUTHCENTRAL
By:
-------------------------------------------------------
Name:
-----------------------------------------------------
Title:
----------------------------------------------------
BMCW SOUTHCENTRAL, L.P.
By: BMC WEST CORPORATION
SOUTHCENTRAL, its General Partner
By:
-------------------------------------------------------
Name:
-----------------------------------------------------
Title:
----------------------------------------------------
BMCW, LLC
By: BMC WEST CORPORATION,
its member
By:
-------------------------------------------------------
Name:
-----------------------------------------------------
Title:
----------------------------------------------------
BMC FRAMING, INC.
By:
-------------------------------------------------------
Name:
-----------------------------------------------------
Title:
----------------------------------------------------
SCHEDULE 1
to Resignation, Assignment and Acceptance Agreement
[To be provided.]
ASSIGNMENT AND ACCEPTANCE
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of September 28, 2001 is made between XXXXX FARGO BANK,
N.A. (the "Assignor") and LASALLE BUSINESS CREDIT, INC. (the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Amended and Restated
Credit Agreement, dated as of August 30, 2001 (as extended, renewed, amended or
restated from time to time, the "Credit Agreement"), among Building Materials
Holdings Corporation, ("Holdings"), BMC West Corporation (the "Company") and
certain other affiliates of Holdings, as guarantors, the several financial
institutions from time to time party thereto (the "Banks"), First Union National
Bank, as Syndication Agent and Xxxxx Fargo Bank, N.A., as issuing bank of
certain letters of credit (in such capacity, the "Issuing Bank"), as Swingline
Bank and as administrative agent (in such capacity, the "Agent"). Any terms
defined in the Credit Agreement and not defined in this Assignment and
Acceptance are used herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to participating in Letters of Credit issued for the account of
Holdings, participating in Swingline Loans to Holdings and to making Loans to
Holdings in an aggregate amount not to exceed $75,000,000.00 (the "Commitment");
WHEREAS, the Assignor has made or participated in Loans in the
aggregate principal amount of $47,411,504.42 to Holdings consisting of
$19,911,504.42 of Revolving Loans and $27,500,000.00 of Term Loans and the
amount of the Assignor's percentage share of the aggregate amount available for
drawing under outstanding Letters of Credit issued for the account of Holdings
is $3,708,000.00;
WHEREAS, the Assignor wishes to assign to the Assignee part of the
rights and obligations of the Assignor under the Credit Agreement in respect of
its Commitment, together with a corresponding portion of any outstanding Loans
and participations in Swingline Loans, if any, participations in L/C Advances,
if any, and participations in Letters of Credit, if any (the "Participations"),
in an amount equal to 10.000000000% of the Assignor's Commitment, Loans and
Participations (if any), on the terms and subject to the conditions set forth
herein, and the Assignee wishes to accept assignment of such rights and to
assume such obligations from the Assignor on such terms and subject to such
conditions; and
WHEREAS, Assignee is simultaneously becoming a party to the Credit
Agreement pursuant to Sections 2.01(c) and 2.01(d) and shall make a Term Loan to
Borrower in the amount of $6,416,666.67 (exclusive of amounts assigned
hereunder) on the date hereof, shall provide a Revolving Commitment to Borrower
in the amount of $11,083,333.33 (exclusive of amounts assigned hereunder), shall
execute and deliver a counterpart signature page to the Credit Agreement, and
shall consequently cause the Aggregate Commitment to increase from
$282,500,000.00 on the Effective Date of the Amended and Restated Credit
Agreement to $300,000,000.00 on the Subsequent Effective Date.
1
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
1. Assignment and Acceptance.
Subject to the terms and conditions of this Assignment and
Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from
the Assignor, without recourse and without representation or warranty (except as
provided in this Assignment and Acceptance) 10.000000000% (the "Assignee's
Percentage Share") of (A) the Commitment and the Loans and Participations (if
any) of the Assignor and (B) all related rights, benefits, obligations,
liabilities and indemnities of the Assignor under and in connection with the
Credit Agreement and the Loan Documents.
With effect on and after the Effective Date (as defined in Section 5
hereof), the Assignee shall be a party to the Credit Agreement and succeed to
all of the rights and be obligated to perform all of the obligations of a Bank
under the Credit Agreement, including the requirements concerning
confidentiality and the payment of indemnification, with a Commitment in the
amount set forth in subsection (c) below. The Assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Bank. It is the
intent of the parties hereto that the Commitment of the Assignor shall, as of
the Effective Date, be reduced by an amount equal to the portion thereof
assigned to the Assignee hereunder, and the Assignor shall relinquish its rights
and be released from its obligations under the Credit Agreement to the extent
such obligations have been assumed by the Assignee; provided, however, that the
Assignor shall not relinquish its rights under Article IV or Sections 11.04 and
11.05 of the Credit Agreement to the extent such rights relate to the time prior
to the Effective Date.
After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignee's Revolving Commitment will be
$15,833,333.33; (ii) the Assignee's Pro Rata Share of the Aggregate Revolving
Commitment will be 8.333333333%; (iii) the Assignee's Term Commitment will be
$9,166,666.67; and (iv) the Assignee's Pro Rata Share of the Aggregate Term
Commitment will be 8.333333333%.
After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignor's Revolving Commitment will be
$42,750,000.00; (ii) the Assignor's Pro Rata Share of the Aggregate Revolving
Commitment will be 22.500000000%; (iii) the Assignor's Term Commitment will be
$24,750,000.00; and (iv) the Assignor's Pro Rata Share of the Aggregate Term
Commitment will be 22.500000000%.
2. Payments.
As consideration for the sale, assignment and transfer contemplated
in Section 1 hereof, the Assignee shall pay to the Assignor on the Effective
Date in immediately available funds an amount equal to $4,500,000.00,
representing the Assignee's Percentage Share of the principal amount of all
Loans and Participations of the Assignor under the Credit
2
Agreement and outstanding on the Effective Date, net of repayment of Revolving
Loans as shown in Exhibit A to this Assignment and Acceptance.
3. Reallocation of Payments. Any interest, fees and other payments
accrued to the Effective Date with respect to the Commitment and any Loans and
Participations of the Assignor shall be for the account of the Assignor. Any
interest, fees and other payments accrued on and after the Effective Date with
respect to the portion of such Commitment and any Loans and Participations
assigned to the Assignee shall be for the account of the Assignee. Each of the
Assignor and the Assignee agrees that it will hold in trust for the other party
any interest, fees and other amounts which it may receive to which the other
party is entitled pursuant to the preceding sentence and pay to the other party
any such amounts which it may receive promptly upon receipt.
4. Independent Credit Decision. The Assignee: (a) acknowledges that
it has received a copy of the Credit Agreement and the Schedules and Exhibits
thereto, together with copies of the most recent financial statements referred
to in Section 6.11 or Section 7.01 of the Credit Agreement, and such other
documents and information as it has deemed appropriate to make its own credit
and legal analysis and decision to enter into this Assignment and Acceptance;
and (b) agrees that it will, independently and without reliance upon the
Assignor, the Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit and legal decisions in taking or not taking action under the Credit
Agreement.
5. Effective Date; Notices.
As between the Assignor and the Assignee, the effective date for
this Assignment and Acceptance shall be September 28, 2001 (the "Effective
Date"); provided that the following conditions precedent have been satisfied on
or before the Effective Date:
(i) this Assignment and Acceptance shall be executed and
delivered by the Assignor and the Assignee;
(ii) any consent of Holdings, the Issuing Bank and the Agent
required under Section 11.08 of the Credit Agreement for the
effectiveness of the assignment hereunder by the Assignor to the
Assignee shall have been duly obtained and shall be in full force
and effect as of the Effective Date;
(iii) the Assignee shall pay to the Assignor all amounts due
to the Assignor under this Assignment and Acceptance;
(iv) the processing fee referred to in Section 2(b) hereof and
in Section 11.08 of the Credit Agreement shall have been paid to the
Agent; and
(v) the Assignor and Assignee shall have complied with the
other requirements of Section 11.08 of the Credit Agreement and with
the requirements of Sections 10.10 and 11.09 of the Credit Agreement
(in each case to the extent applicable).
3
Promptly following the execution of this Assignment and
Acceptance, the Assignor shall deliver to Holdings and the Agent for
acknowledgement a Notice of Assignment substantially in the form
attached hereto as Schedule 1.
6. Agent. The Assignee hereby appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under the
Credit Agreement as are delegated to the Agent by the Banks pursuant to the
terms of the Credit Agreement. The Assignee shall assume no duties or
obligations held by the Assignor in its capacity as Agent or Issuing Bank under
the Credit Agreement.
7. Withholding Tax. The Assignee (a) represents and warrants to the
Assignor, the Agent and Holdings that under applicable law and treaties no tax
will be required to be withheld by Holdings or the Agent with respect to any
payments to be made to the Assignee hereunder, and (b) agrees to furnish (if it
is organized under the laws of any jurisdiction other than the United States or
any State thereof) to the Agent and Holdings prior to the time that the Agent or
Holdings is required to make any payment of interest or fees under the Credit
Agreement, duplicate executed originals of either U.S. Internal Revenue Service
Form W-8ECI (if the Assignee claims that interest or fees paid under the Credit
Agreement will be exempt from United States withholding tax because it is
effectively connected with a United States trade or business of the Assignee) or
U.S. Internal Revenue Service Form W-8BEN (if the Assignee claims an exemption
from, or a reduction of, withholding tax under a United States tax treaty) and
agrees to provide new Forms W-8ECI or W-8BEN upon the expiration of any
previously delivered form or comparable statements in accordance with applicable
U.S. law and regulations and amendments thereto, duly executed and completed by
the Assignee, as and when required under the Credit Agreement.
8. Representations and Warranties.
The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any Lien or other adverse claim; (ii) it is duly
organized and existing and it has the full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any Person are required (other than those referred to in Section
5(a)(ii) hereof and any already given or obtained) for its due execution,
delivery and performance of this Assignment and Acceptance, and apart from any
agreements or undertakings or filings required by the Credit Agreement, no
further action by, or notice to, or filing with, any Person is required of it
for such execution, delivery or performance; and (iv) this Assignment and
Acceptance has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignor, enforceable against the Assignor
in accordance with the terms hereof, subject, as to enforcement, to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors' rights and to general equitable principles.
The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in
4
connection with the Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement or any
other instrument or document furnished pursuant thereto. The Assignor makes no
representation or warranty in connection with, and assumes no responsibility
with respect to, the solvency, financial condition or statements of any Loan
Party, or the performance or observance by any Loan Party, of any of its
respective obligations under the Credit Agreement or any other instrument or
document furnished in connection therewith.
The Assignee represents and warrants that (i) it is duly organized
and existing and it has full power and authority to take, and has taken, all
action necessary to execute and deliver this Assignment and Acceptance and any
other documents required or permitted to be executed or delivered by it in
connection with this Assignment and Acceptance, and to fulfill its obligations
hereunder; (ii) no notices to, or consents, authorizations or approvals of, any
Person are required (other than those referred to in Section 5(a)(ii) hereof and
any already given or obtained) for its due execution, delivery and performance
of this Assignment and Acceptance; and apart from any agreements or undertakings
or filings required by the Credit Agreement, no further action by, or notice to,
or filing with, any Person is required of it for such execution, delivery or
performance; (iii) this Assignment and Acceptance has been duly executed and
delivered by it and constitutes the legal, valid and binding obligation of the
Assignee, enforceable against the Assignee in accordance with the terms hereof,
subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles; and (iv) it is an
Eligible Assignee.
9. Further Assurances. The Assignor and the Assignee each hereby
agrees to execute and deliver such other instruments, and take such other
action, as either party may reasonably request in connection with the
transactions contemplated by this Assignment and Acceptance, including the
delivery of any notices or other documents or instruments to Holdings or the
Agent, which may be required in connection with the assignment and assumption
contemplated hereby.
10. Miscellaneous.
Any amendment or waiver of any provision of this Assignment and
Acceptance shall be in writing and signed by the parties hereto. No failure or
delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance shall be without prejudice to any
rights with respect to any other or further breach thereof.
All payments made hereunder shall be made without any set-off or
counterclaim.
The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.
5
This Assignment and Acceptance may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF CALIFORNIA. THE ASSIGNOR AND THE
ASSIGNEE EACH IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY STATE
OR FEDERAL COURT SITTING IN CALIFORNIA OVER ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS ASSIGNMENT AND ACCEPTANCE AND IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH CALIFORNIA STATE OR FEDERAL COURT. EACH PARTY TO THIS
ASSIGNMENT AND ACCEPTANCE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY EFFECTIVELY DO SO, 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 ASSIGNMENT AND ACCEPTANCE OR ANY DOCUMENT RELATED HERETO, AND
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS
ASSIGNMENT AND ACCEPTANCE, AND ANY RELATED DOCUMENTS AND AGREEMENTS, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY EITHER OF THE PARTIES AGAINST THE OTHER PARTY,
WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH OF THE
PARTIES ALSO AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A
COURT TRIAL WITHOUT A JURY.
6
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
XXXXX FARGO BANK, N.A.
By:_______________________
Title:____________________
LASALLE BUSINESS CREDIT, INC.
By:_______________________
Title:____________________
7
SCHEDULE 1
to the Assignment and Acceptance
NOTICE OF ASSIGNMENT AND ACCEPTANCE
Date: September 28, 2001
Xxxxx Fargo Bank, N.A. as Issuing Bank,
Swingline Bank and Agent
Xxxxx Fargo Bank, N.A.
000 Xxxxxxxxxx Xxxxxx
MAC A0101-096
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxx@xxxxxxxxxx.xxx
Building Materials Holding Corporation
Xxx Xxxxxx
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx, Senior Vice President of Finance and
Treasurer
Ladies and Gentlemen:
We refer to the Amended and Restated Credit Agreement, dated as of
August 30, 2001 (as extended, renewed, amended or restated from time to time,
the "Credit Agreement"), among Building Materials Holdings Corporation,
("Holdings"), BMC West Corporation (the "Company") and certain other affiliates
of Holdings, as guarantors, the several financial institutions from time to time
party thereto (the "Banks"), First Union National Bank, as Syndication Agent and
Xxxxx Fargo Bank, N.A., as issuing bank of certain letters of credit (in such
capacity, the "Issuing Bank"), as Swingline Bank and as administrative agent (in
such capacity, the "Agent"). Terms defined in the Credit Agreement are used
herein as therein defined.
1. We hereby give you notice of , and request the consent of
Holdings to, the assignment by XXXXX FARGO BANK, N.A. (the "Assignor") to
LASALLE
8
BUSINESS CREDIT, INC. (the "Assignee") of 10.000000000% of the right, title and
interest of the Assignor in and to the Credit Agreement (including, without
limitation, 10.000000000% of the right, title and interest of the Assignor in
and to the Commitment of the Assignor, all outstanding Loans made or
participated in by the Assignor and all Letters of Credit participated in by
Assignor) pursuant to that certain Assignment and Acceptance Agreement, dated as
of September 28, 2001 (the "Assignment and Acceptance") between Assignor and
Assignee, a copy of which Assignment and Acceptance is attached hereto. Before
giving effect to such assignment the Assignor's Revolving Commitment is
$47,500,000.00, its Pro Rata Share of the Aggregate Revolving Commitment is
26.548672566%, its Term Commitment is $27,500,000.00 and its outstanding Pro
Rata Share of the Aggregate Term Commitment is 26.548672566%.
2. The Assignee agrees that, upon receiving the consent of Holdings,
the Agent, the Issuing Bank and the Swingline Bank to such assignment (in each
case, if applicable) and from and after the Effective Date (as such term is
defined in Section 5 of the Assignment and Acceptance), the Assignee shall be
bound by the terms of the Credit Agreement, with respect to the interest in the
Credit Agreement assigned to it as specified above, as fully and to the same
extent as if the Assignee were the Bank originally holding such interest in the
Credit Agreement.
3. The following administrative details apply to the Assignee:
(A) Lending Office(s):
Assignee name: LaSalle Business Credit, Inc.
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: Xxxxx.xxxxxxxx@xxxxxxx.xxx
(B) Notice Address:
Assignee name: LaSalle Business Credit, Inc.
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
9
Facsimile: (000) 000-0000
Email: Xxxxxxx.xxxxxx@xxxxxxx.xxx
(C) Payment Instructions:
Name of Bank: LaSalle Bank N.A.
City Chicago, IL
Account No.: 0000000
ABA No.: 000000000
Account Name: LaSalle Business Credit
Reference: Building Materials Participation
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
5. This Notice of Assignment and Acceptance may be executed by the
Assignor and the Assignee in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute one and the same notice and agreement.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
Revolving Commitment: XXXXX FARGO BANK, N.A.
$42,750,000.00 By:____________________
Term Commitment: Title:_________________
$24,750,000.00
Pro Rata Share of Aggregate Revolving Commitment:
22.500000000%
10
Pro Rata Share of Aggregate Term Commitment:
22.500000000%
Revolving Commitment: LASALLE BUSINESS CREDIT, INC.
$15,833,333.33 By:____________________
Term Commitment: Title:_________________
$9,166,666.67
Pro Rata Share of Aggregate Revolving Commitment:
8.333333333%
Pro Rata Share of Aggregate Revolving Commitment:
8.333333333%
11
CONSENTED TO as of September 28, 2001:
BUILDING MATERIALS HOLDING CORPORATION
By:___________________________________
Title:________________________________
ACKNOWLEDGED AND CONSENTED TO as of September 28, 2001:
XXXXX FARGO BANK, N.A.,
as Issuing Bank, Swingline Bank and Agent
By:___________________________________
Title:________________________________
12
EXHIBIT A
Pre-Increase and Assignment
Institution Commitment Revolver Commitment Percentage Revolver Funded
----------- ------------ ------------------- --------------- ---------------
Xxxxx Fargo Bank, N.A. $ 75,000,000 $ 47,500,000.00 26.548672566% $19,911,504.42
First Union National Bank $ 40,000,000 $ 25,333,333.33 14.159292035% $10,619,469.03
U.S. Bank National Association $ 25,000,000 $ 15,833,333.33 8.849557522% $ 6,637,168.14
Union Bank of California, N.A. $ 25,000,000 $ 15,833,333.33 8.849557522% $ 6,637,168.14
Comerica West Incorporated $ 20,000,000 $ 12,666,666.67 7.079646018% $ 5,309,734.51
WM Business Bank $ 20,000,000 $ 12,666,666.67 7.079646018% $ 5,309,734.51
Banque Nationale De Paris $ 15,000,000 $ 9,500,000.00 5.309734513% $ 3,982,300.88
Xxxxxx Trust and Savings Bank $ 25,000,000 $ 15,833,333.33 8.849557522% $ 6,637,168.14
Guaranty Bank $ 15,000,000 $ 9,500,000.00 5.309734513% $ 3,982,300.88
West Coast Bank $ 15,000,000 $ 9,500,000.00 5.309734513% $ 3,982,300.88
Bank Leumi USA $ 7,500,000 $ 4,750,000.00 2.654867257% $ 1,991,150.44
------------
$282,500,000 $ 178,916,666.67 100.000000000% $75,000,000.00
============
check $ 178,916,666.67 $75,000,000.00
Institution Term Total Commitment Total Funded
----------- --------------- ---------------- --------------
Xxxxx Fargo Bank, N.A. $ 27,500,000.00 $ 75,000,000.00 $ 47,411,504.42
First Union National Bank $ 14,666,666.67 $ 40,000,000.00 $ 25,286,135.69
U.S. Bank National Association $ 9,166,666.67 $ 25,000,000.00 $ 15,803,834.81
Union Bank of California, N.A. $ 9,166,666.67 $ 25,000,000.00 $ 15,803,834.81
Comerica West Incorporated $ 7,333,333.33 $ 20,000,000.00 $ 12,643,067.85
WM Business Bank $ 7,333,333.33 $ 20,000,000.00 $ 12,643,067.85
Banque Nationale De Paris $ 5,500,000.00 $ 15,000,000.00 $ 9,482,300.88
Xxxxxx Trust and Savings Bank $ 9,166,666.67 $ 25,000,000.00 $ 15,803,834.81
Guaranty Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,482,300.88
West Coast Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,482,300.88
Bank Leumi USA $ 2,750,000.00 $ 7,500,000.00 $ 4,741,150.44
$103,583,333.33 $282,500,000.00 $178,583,333.33
$103,583,333.33 $282,500,000.00 $178,583,333.33
Post-Increase and Assignment: Pre-$5MM paydown of revolver
Institution Commitment Revolver Commitment Percentage Revolver Funded
----------- ------------- ------------------- ------------ ---------------
Xxxxx Fargo Bank, N.A. $ 67,500,000 $ 42,750,000.00 22.500000000% $ 16,875,000.00
First Union National Bank $ 40,000,000 $ 25,333,333.33 13.333333333% $ 10,000,000.00
LaSalle Business Credit $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
U.S. Bank National Association $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
Union Bank of California, N.A. $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
Comerica West Incorporated $ 20,000,000 $ 12,666,666.67 6.666666667% $ 5,000,000.00
WM Business Bank $ 20,000,000 $ 12,666,666.67 6.666666667% $ 5,000,000.00
Banque Nationale De Paris $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,750,000.00
Xxxxxx Trust and Savings Bank $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
Guaranty Bank $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,750,000.00
West Coast Bank $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,750,000.00
Bank Leumi USA $ 7,500,000 $ 4,750,000.00 2.500000000% $ 1,875,000.00
-------------
$ 300,000,000 $ 190,000,000.00 100.000000000% $ 75,000,000.00
=============
check $ 190,000,000.00 $ 75,000,000.00
Institution Term Total Commitment Total Funded
----------- --------------- ---------------- ---------------
Xxxxx Fargo Bank, N.A. $ 24,750,000.00 $ 67,500,000.00 $ 41,625,000.00
First Union National Bank $ 14,666,666.67 $ 40,000,000.00 $ 24,666,666.67
LaSalle Business Credit $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
U.S. Bank National Association $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
Union Bank of California, N.A. $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
Comerica West Incorporated $ 7,333,333.33 $ 20,000,000.00 $ 12,333,333.33
WM Business Bank $ 7,333,333.33 $ 20,000,000.00 $ 12,333,333.33
Banque Nationale De Paris $ 5,500,000.00 $ 15,000,000.00 $ 9,250,000.00
Xxxxxx Trust and Savings Bank $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
Guaranty Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,250,000.00
West Coast Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,250,000.00
Bank Leumi USA $ 2,750,000.00 $ 7,500,000.00 $ 4,625,000.00
$ 110,000,000.00 $300,000,000.00 $185,000,000.00
$ 110,000,000.00 $300,000,000.00 $185,000,000.00
Increase and Assignment Detail: Pre-$5MM paydown of revolver
Institution Commitment Revolver Commitment Percentage Revolver Funded
----------- ------------ ------------------- ---------- ---------------
LaSalle Business Credit $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
Increased $ 17,500,000 $ 11,083,333.33 5.833333333% $ 4,375,000.00
Assigned $ 7,500,000 $ 4,750,000.00 2.500000000% $ 1,875,000.00
Total $ 25,000,000 $ 15,833,333.33 8.333333333% $ 6,250,000.00
Institution Term Total Commitment Total Funded
----------- -------------- --------------- ----------------
LaSalle Business Credit $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
Increased $ 6,416,666.67 $ 17,500,000.00 $ 10,791,666.67
Assigned $ 2,750,000.00 $ 7,500,000.00 $ 4,625,000.00
Total $ 9,166,666.67 $ 25,000,000.00 $ 15,416,666.67
Post-Increase and Assignment Post-$5MM paydown of revolver
Institution Commitment Revolver Commitment Percentage Revolver Funded
----------- ------------- ------------------- ------------- ---------------
Xxxxx Fargo Bank, N.A. $ 67,500,000 $ 42,750,000.00 22.500000000% $ 15,750,000.00
First Union National Bank $ 40,000,000 $ 25,333,333.33 13.333333333% $ 9,333,333.33
LaSalle Business Credit $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
U.S. Bank National Association $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
Union Bank of California, N.A. $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
Comerica West Incorporated $ 20,000,000 $ 12,666,666.67 6.666666667% $ 4,666,666.67
WM Business Bank $ 20,000,000 $ 12,666,666.67 6.666666667% $ 4,666,666.67
Banque Nationale De Paris $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,500,000.00
Xxxxxx Trust and Savings Bank $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
Guaranty Bank $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,500,000.00
West Coast Bank $ 15,000,000 $ 9,500,000.00 5.000000000% $ 3,500,000.00
Bank Leumi USA $ 7,500,000 $ 4,750,000.00 2.500000000% $ 1,750,000.00
-------------
$ 300,000,000 $190,000,000.00 100.000000000% $ 70,000,000.00
=============
check $190,000,000.00 $ 70,000,000.00
Institution Term Total Commitment Total Funded
----------- ---------------- ---------------- ----------------
Xxxxx Fargo Bank, N.A. $ 24,750,000.00 $ 67,500,000.00 $ 40,500,000.00
First Union National Bank $ 14,666,666.67 $ 40,000,000.00 $ 24,000,000.00
LaSalle Business Credit $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
U.S. Bank National Association $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
Union Bank of California, N.A. $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
Comerica West Incorporated $ 7,333,333.33 $ 20,000,000.00 $ 12,000,000.00
WM Business Bank $ 7,333,333.33 $ 20,000,000.00 $ 12,000,000.00
Banque Nationale De Paris $ 5,500,000.00 $ 15,000,000.00 $ 9,000,000.00
Xxxxxx Trust and Savings Bank $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
Guaranty Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,000,000.00
West Coast Bank $ 5,500,000.00 $ 15,000,000.00 $ 9,000,000.00
Bank Leumi USA $ 2,750,000.00 $ 7,500,000.00 $ 4,500,000.00
$ 110,000,000.00 $ 300,000,000.00 $ 180,000,000.00
$ 110,000,000.00 $ 300,000,000.00 $ 180,000,000.00
Increase and Assignment Detail: Pre-$5MM paydown of revolver
Institution Commitment Revolver Commitment Percentage Revolver Funded
----------- ------------ ------------------- ------------ ---------------
LaSalle Business Credit $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
Increased $ 17,500,000 $ 11,083,333.33 5.833333333% $ 4,083,333.33
Assigned $ 7,500,000 $ 4,750,000.00 2.500000000% $ 1,750,000.00
Total $ 25,000,000 $ 15,833,333.33 8.333333333% $ 5,833,333.33
Institution Term Total Commitment Total Funded
----------- -------------- ---------------- ----------------
LaSalle Business Credit $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
Increased $ 6,416,666.67 $ 17,500,000.00 $105,000,000.00
Assigned $ 2,750,000.00 $ 7,500,000.00 $ 4,500,000.00
Total $ 9,166,666.67 $ 25,000,000.00 $ 15,000,000.00
13
FORM OF ASSIGNMENT AND ACCEPTANCE
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of January 15, 2002 is made between Xxxxx Fargo Bank, N.A.
(the "Assignor") and Israel Discount Bank of New York (the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Amended and Restated
Credit Agreement, dated as of August 30, 2001 (as extended, renewed, amended or
restated from time to time, the "Credit Agreement"), among Building Materials
Holdings Corporation, ("Holdings"), BMC West Corporation (the "Company") and
certain other affiliates of Holdings, as guarantors, the several financial
institutions from time to time party thereto (the "Banks"), First Union National
Bank, as Syndication Agent and Xxxxx Fargo Bank, N.A., as issuing bank of
certain letters of credit (in such capacity, the "Issuing Bank"), as Swingline
Bank and as administrative agent (in such capacity, the "Agent"). Any terms
defined in the Credit Agreement and not defined in this Assignment and
Acceptance are used herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to participating in Letters of Credit issued for the account of
Holdings, participating in Swingline Loans to Holdings and to making Loans to
Holdings in an aggregate amount not to exceed $67,500,000.00 (the "Commitment");
WHEREAS, [the Assignor has made or participated in Loans in the
aggregate principal amount of $35,685,000.00 to Holdings consisting of
$10,935,000.00 of Revolving Loans and $24,750,000.00 of Term Loans and the
amount of the Assignor's percentage share of the aggregate amount available for
drawing under outstanding Letters of Credit issued for the account of Holdings
is $924,300.00; and
WHEREAS, the Assignor wishes to assign to the Assignee part of the
rights and obligations of the Assignor under the Credit Agreement in respect of
its Commitment, together with a corresponding portion of any outstanding Loans
and participations in Swingline Loans, if any, participations in L/C Advances,
if any, and participations in Letters of Credit, if any (the "Participations"),
in an amount equal to 11.111111111% of the Assignor's Commitment, Loans and
Participations (if any), on the terms and subject to the conditions set forth
herein, and the Assignee wishes to accept assignment of such rights and to
assume such obligations from the Assignor on such terms and subject to such
conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
E-1
Assignment and Acceptance.
Subject to the terms and conditions of this Assignment and
Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from
the Assignor, without recourse and without representation or warranty (except as
provided in this Assignment and Acceptance) 11.111111111% (the "Assignee's
Percentage Share") of (A) the Commitment and the Loans and Participations (if
any) of the Assignor and (B) all related rights, benefits, obligations,
liabilities and indemnities of the Assignor under and in connection with the
Credit Agreement and the Loan Documents.
With effect on and after the Effective Date (as defined in Section 5
hereof), the Assignee shall be a party to the Credit Agreement and succeed to
all of the rights and be obligated to perform all of the obligations of a Bank
under the Credit Agreement, including the requirements concerning
confidentiality and the payment of indemnification, with a Commitment in the
amount set forth in subsection (c) below. The Assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Bank. It is the
intent of the parties hereto that the Commitment of the Assignor shall, as of
the Effective Date, be reduced by an amount equal to the portion thereof
assigned to the Assignee hereunder, and the Assignor shall relinquish its rights
and be released from its obligations under the Credit Agreement to the extent
such obligations have been assumed by the Assignee; provided, however, that the
Assignor shall not relinquish its rights under Article IV or Sections 11.04 and
11.05 of the Credit Agreement to the extent such rights relate to the time prior
to the Effective Date.
After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignee's Revolving Commitment will be
$4,750,000.00; (ii) the Assignee's Pro Rata Share of the Aggregate Revolving
Commitment will 2.5%; (iii) the Assignee's Term Commitment will be
$2,750,000.00; and (iv) the Assignee's Pro Rata Share of the Aggregate Term
Commitment will be 2.5%.
After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignor's Revolving Commitment will be
$38,000,000.00; (ii) the Assignor's Pro Rata Share of the Aggregate Revolving
Commitment will be 20.00%; (iii) the Assignor's Term Commitment will be
$22,000,000.00; and (iv) the Assignor's Pro Rata Share of the Aggregate Term
Commitment will be 20.00%.
Payments.
As consideration for the sale, assignment and transfer contemplated
in Section 1 hereof, the Assignee shall pay to the Assignor on the Effective
Date in immediately available funds an amount equal to $3,965,000.00,
representing the Assignee's Percentage Share of the principal amount of all
Loans and Participations of the Assignor under the Credit Agreement and
outstanding on the Effective Date.
The Assignment, processing and recordation fee of $3,5000.00 is
waived as referenced in Section 11.08 for this particular Assignment &
Assumption Agreement
E-2
Reallocation of Payments. Any interest, fees and other payments
accrued to the Effective Date with respect to the Commitment and any Loans and
Participations of the Assignor shall be for the account of the Assignor. Any
interest, fees and other payments accrued on and after the Effective Date with
respect to the portion of such Commitment and any Loans and Participations
assigned to the Assignee shall be for the account of the Assignee. Each of the
Assignor and the Assignee agrees that it will hold in trust for the other party
any interest, fees and other amounts which it may receive to which the other
party is entitled pursuant to the preceding sentence and pay to the other party
any such amounts which it may receive promptly upon receipt.
Independent Credit Decision. The Assignee: (a) acknowledges that it
has received a copy of the Credit Agreement and the Schedules and Exhibits
thereto, together with copies of the most recent financial statements referred
to in Section 6.11 or Section 7.01 of the Credit Agreement, and such other
documents and information as it has deemed appropriate to make its own credit
and legal analysis and decision to enter into this Assignment and Acceptance;
and (b) agrees that it will, independently and without reliance upon the
Assignor, the Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit and legal decisions in taking or not taking action under the Credit
Agreement.
Effective Date; Notices.
As between the Assignor and the Assignee, the effective date for
this Assignment and Acceptance shall be January 15, 2002 (the "Effective Date");
provided that the following conditions precedent have been satisfied on or
before the Effective Date:
(i) this Assignment and Acceptance shall be executed and delivered
by the Assignor and the Assignee;
any consent of Holdings, the Issuing Bank and the Agent required
under Section 11.08 of the Credit Agreement for the effectiveness of the
assignment hereunder by the Assignor to the Assignee shall have been duly
obtained and shall be in full force and effect as of the Effective Date;
the Assignee shall pay to the Assignor all amounts due to the
Assignor under this Assignment and Acceptance;
the processing fee referred to in Section 2(b) hereof and in Section
11.08 of the Credit Agreement shall have been paid to the Agent; and
the Assignor and Assignee shall have complied with the other
requirements of Section 11.08 of the Credit Agreement and with the
requirements of Sections 10.10 and 11.09 of the Credit Agreement (in each
case to the extent applicable).
Promptly following the execution of this Assignment and Acceptance,
the Assignor shall deliver to Holdings and the Agent for acknowledgement a
Notice of Assignment substantially in the form attached hereto as Schedule 1.
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Agent. The Assignee hereby appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent by the Banks pursuant to the terms of
the Credit Agreement. The Assignee shall assume no duties or obligations held by
the Assignor in its capacity as Agent or Issuing Bank under the Credit
Agreement.
Withholding Tax. The Assignee (a) represents and warrants to the
Assignor, the Agent and Holdings that under applicable law and treaties no tax
will be required to be withheld by Holdings or the Agent with respect to any
payments to be made to the Assignee hereunder, and (b) agrees to furnish (if it
is organized under the laws of any jurisdiction other than the United States or
any State thereof) to the Agent and Holdings prior to the time that the Agent or
Holdings is required to make any payment of interest or fees under the Credit
Agreement, duplicate executed originals of either U.S. Internal Revenue Service
Form W-8ECI (if the Assignee claims that interest or fees paid under the Credit
Agreement will be exempt from United States withholding tax because it is
effectively connected with a United States trade or business of the Assignee) or
U.S. Internal Revenue Service Form W-8BEN (if the Assignee claims an exemption
from, or a reduction of, withholding tax under a United States tax treaty) and
agrees to provide new Forms W-8ECI or W-8BEN upon the expiration of any
previously delivered form or comparable statements in accordance with applicable
U.S. law and regulations and amendments thereto, duly executed and completed by
the Assignee, as and when required under the Credit Agreement.
Representations and Warranties.
The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any Lien or other adverse claim; (ii) it is duly
organized and existing and it has the full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any Person are required (other than those referred to in Section
5(a)(ii) hereof and any already given or obtained) for its due execution,
delivery and performance of this Assignment and Acceptance, and apart from any
agreements or undertakings or filings required by the Credit Agreement, no
further action by, or notice to, or filing with, any Person is required of it
for such execution, delivery or performance; and (iv) this Assignment and
Acceptance has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignor, enforceable against the Assignor
in accordance with the terms hereof, subject, as to enforcement, to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors' rights and to general equitable principles.
The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto. The
Assignor makes no representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency, financial condition or
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statements of any Loan Party, or the performance or observance by any Loan
Party, of any of its respective obligations under the Credit Agreement or any
other instrument or document furnished in connection therewith.
The Assignee represents and warrants that (i) it is duly organized
and existing and it has full power and authority to take, and has taken, all
action necessary to execute and deliver this Assignment and Acceptance and any
other documents required or permitted to be executed or delivered by it in
connection with this Assignment and Acceptance, and to fulfill its obligations
hereunder; (ii) no notices to, or consents, authorizations or approvals of, any
Person are required (other than those referred to in Section 5(a)(ii) hereof and
any already given or obtained) for its due execution, delivery and performance
of this Assignment and Acceptance; and apart from any agreements or undertakings
or filings required by the Credit Agreement, no further action by, or notice to,
or filing with, any Person is required of it for such execution, delivery or
performance; (iii) this Assignment and Acceptance has been duly executed and
delivered by it and constitutes the legal, valid and binding obligation of the
Assignee, enforceable against the Assignee in accordance with the terms hereof,
subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles; and (iv) it is an
Eligible Assignee.
Further Assurances. The Assignor and the Assignee each hereby agrees
to execute and deliver such other instruments, and take such other action, as
either party may reasonably request in connection with the transactions
contemplated by this Assignment and Acceptance, including the delivery of any
notices or other documents or instruments to Holdings or the Agent, which may be
required in connection with the assignment and assumption contemplated hereby.
Miscellaneous.
Any amendment or waiver of any provision of this Assignment and
Acceptance shall be in writing and signed by the parties hereto. No failure or
delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance shall be without prejudice to any
rights with respect to any other or further breach thereof.
All payments made hereunder shall be made without any set-off or
counterclaim.
The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.
This Assignment and Acceptance may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
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THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF CALIFORNIA. THE ASSIGNOR AND THE
ASSIGNEE EACH IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY STATE
OR FEDERAL COURT SITTING IN CALIFORNIA OVER ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS ASSIGNMENT AND ACCEPTANCE AND IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH CALIFORNIA STATE OR FEDERAL COURT. EACH PARTY TO THIS
ASSIGNMENT AND ACCEPTANCE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY EFFECTIVELY DO SO, 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 ASSIGNMENT AND ACCEPTANCE OR ANY DOCUMENT RELATED HERETO, AND
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS
ASSIGNMENT AND ACCEPTANCE, AND ANY RELATED DOCUMENTS AND AGREEMENTS, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY EITHER OF THE PARTIES AGAINST THE OTHER PARTY,
WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH OF THE
PARTIES ALSO AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A
COURT TRIAL WITHOUT A JURY.
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IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
Xxxxx Fargo Bank, N.A.
By:_______________________
Title:____________________
Israel Discount Bank of New York
By:_______________________
Title:____________________
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SCHEDULE 1
to the Assignment and Acceptance
NOTICE OF ASSIGNMENT AND ACCEPTANCE
Date: January 15, 2002
Xxxxx Fargo Bank, N.A. as Issuing Bank,
Swingline Bank and Agent
Attention: Xxxxxx (Max) Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Building Materials Holding Corporation
Xxx Xxxxxx
Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, SVP
Ladies and Gentlemen:
We refer to the Amended and Restated Credit Agreement, dated as of
August 30, 2001 (as extended, renewed, amended or restated from time to time,
the "Credit Agreement"), among Building Materials Holdings Corporation,
("Holdings"), BMC West Corporation (the "Company") and certain other affiliates
of Holdings, as guarantors, the several financial institutions from time to time
party thereto (the "Banks"), First Union National Bank, as Syndication Agent and
Xxxxx Fargo Bank, N.A., as issuing bank of certain letters of credit (in such
capacity, the "Issuing Bank"), as Swingline Bank and as administrative agent (in
such capacity, the "Agent"). Terms defined in the Credit Agreement are used
herein as therein defined.
1. We hereby give you notice of, and request the consent of
Holdings, the Issuing Bank, the Swingline Bank and the Agent to, the assignment
by Xxxxx Fargo Bank, N.A. (the "Assignor") to Israel Discount Bank of New York
(the "Assignee") of 11.111111111% of the right, title and interest of the
Assignor in and to the Credit Agreement (including, without limitation,
11.111111111% of the right, title and interest of the Assignor in and to the
Commitment of the Assignor, all outstanding Loans made or participated in by the
Assignor and all Letters of Credit participated in by Assignor) pursuant to that
certain Assignment and Acceptance Agreement, dated as of January 15, 2002 (the
"Assignment and Acceptance") between Assignor and Assignee, a copy of which
Assignment and Acceptance is attached hereto. Before giving effect to such
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assignment the Assignor's Revolving Commitment is $42,750,000.00, its Pro Rata
Share of the Aggregate Revolving Commitment is 22.50%, its Term Commitment is
$24,750,000.00 and its outstanding Pro Rata Share of the Aggregate Term
Commitment is $24,750,000.00.
2. The Assignee agrees that, upon receiving the consent of Holdings,
the Agent, the Issuing Bank and the Swingline Bank to such assignment (in each
case, if applicable) and from and after the Effective Date (as such term is
defined in Section 5 of the Assignment and Acceptance), the Assignee shall be
bound by the terms of the Credit Agreement, with respect to the interest in the
Credit Agreement assigned to it as specified above, as fully and to the same
extent as if the Assignee were the Bank originally holding such interest in the
Credit Agreement.
3. The following administrative details apply to the Assignee:
(A) Lending Office(s):
Assignee name: Israel Discount Bank of New York
Address: 0000 Xxxxxxxx Xxxx, Xxx 000
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxx Xxxxxx, VP
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(B) Notice Address:
Assignee name: Israel Discount Bank of New York
Address: 0000 Xxxxxxxx Xxxx, Xxx. 000
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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(C) Payment Instructions:
ABA.: 000-000-000
At: Israel Discount Bank of New York
Beverly Hills, CA
Reference: Building Material Holding Corp.
Attention:
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
5. This Notice of Assignment and Acceptance may be executed by the
Assignor and the Assignee in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute one and the same notice and agreement.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
Revolving Commitment: Xxxxx Fargo Bank, N.A.
$38,000,000 By:____________________
Term Commitment: Title:_________________
$22,000,000
Pro Rata Share of Aggregate Revolving Commitment:
20%
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Pro Rata Share of Aggregate Term Commitment:
20%
Revolving Commitment: Israel Discount Bank of
New York
$4,750,000
By:_____________________
Term Commitment: Title:__________________
$2,750,000
Pro Rata Share of Aggregate Revolving Commitment:
2.5%
Pro Rata Share of Aggregate Revolving Commitment:
2.5%
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CONSENTED TO as of ________:
BUILDING MATERIALS HOLDING CORPORATION
By:____________________________________
Title:_________________________________
ACKNOWLEDGED AND CONSENTED TO as of ___________:
XXXXX FARGO BANK, N.A.,
as Issuing Bank, Swingline Bank and Agent
By:____________________________________
Title:_________________________________
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