EXHIBIT 10 (ee)
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CREDIT AGREEMENT
by and among
DATA GENERAL CORPORATION
as Borrower,
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION,
as Agent and as Lender,
THE BANK OF NEW YORK
and
FLEET NATIONAL BANK
as Co-Agents and as Lenders
and
THE LENDERS PARTY HERETO FROM TIME TO TIME
September 30, 1997
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TABLE OF CONTENTS
ARTICLE I
Definitions and Terms
1.1. Definitions.....................................................1
1.2. Rules of Interpretation........................................24
ARTICLE II
The Revolving Credit Facility
2.1. Revolving Loans................................................26
2.2. Payment of Interest............................................28
2.3. Payment of Principal...........................................28
2.4. Manner of Payments.............................................29
2.5. Notes..........................................................29
2.6. Pro Rata Payments..............................................30
2.7. Reductions.....................................................30
2.8. Conversions and Elections of Subsequent Interest Periods.......30
2.9. Increase and Decrease in Amounts...............................31
2.10. Commitment Fee................................................31
2.11. Deficiency Advances...........................................31
2.12. Use of Proceeds...............................................32
2.13. Swing Line....................................................32
ARTICLE III
Letters of Credit
3.1. Letters of Credit..............................................33
3.2. Reimbursement..................................................34
3.3. Letter of Credit Facility Fees.................................37
3.4. Administrative Fees............................................37
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ARTICLE IV
Change in Circumstances
4.1. Increased Cost and Reduced Return..............................38
4.2. Limitation on Types of Loans...................................39
4.3. Illegality.....................................................39
4.4. Treatment of Affected Loans....................................40
4.5. Compensation...................................................40
4.6. Taxes..........................................................41
ARTICLE V
Conditions to Making Loans and Issuing Letters of Credit
5.1. Conditions of Initial Advance of Revolving Loans and Initial Issuance
of Letters of Credit...........................................44
5.2. Conditions of Revolving Loans and Letter of Credit.............46
ARTICLE VI
Representations and Warranties
6.1. Organization and Authority.....................................48
6.2. Loan Documents.................................................48
6.3. Solvency.......................................................49
6.4. Ownership of the Borrower and its Subsidiaries.................49
6.5. Borrower Ownership Interests...................................49
6.6. Financial Condition............................................49
6.7. Title to Properties............................................50
6.8. Taxes..........................................................50
6.9. Other Agreements...............................................50
6.10. Litigation....................................................51
6.11. Margin Stock..................................................51
6.12. Investment Company; Public Utility Holding Company............51
6.13. Intellectual Property.........................................51
6.14. No Untrue Statement...........................................52
6.15. No Consents, Etc..............................................52
6.16. Employee Benefit Plans........................................52
6.17. No Default....................................................53
6.18. Hazardous Materials...........................................53
6.19. Employment Matters............................................54
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ARTICLE VII
Affirmative Covenants
7.1. Financial Reports, Etc........................................55
7.2. Maintain Properties...........................................56
7.3. Existence, Qualification, Etc.................................56
7.4. Regulations and Taxes.........................................56
7.5. Insurance.....................................................56
7.6. True Books....................................................57
7.7. Right of Inspection...........................................57
7.8. Observe all Laws..............................................57
7.9. Governmental Licenses.........................................57
7.10. Covenants Extending to Subsidiaries...........................57
7.11. Officer's Knowledge of Default................................57
7.12. Suits or Other Proceedings....................................58
7.13. Notice of Discharge of Hazardous Material or Environmental
Complaint.....................................................58
7.14. Environmental Compliance......................................58
7.15. Indemnification...............................................58
7.16. Further Assurances............................................59
7.17. Employee Benefit Plans........................................59
7.18. Continued Operations..........................................60
7.19. New Material Subsidiaries.....................................60
ARTICLE VIII
Negative Covenants
8.1. Financial Covenants...........................................61
8.2. Acquisitions..................................................61
8.3. Liens.........................................................62
8.4. Indebtedness..................................................63
8.5. Transfer of Assets; Issuance of Capital Stock.................65
8.6. Investments...................................................65
8.7. Merger or Consolidation.......................................66
8.8. Restricted Payments...........................................67
8.9. Transactions with Affiliates..................................67
8.10. Compliance with ERISA.........................................67
8.11. Fiscal Year...................................................68
8.12. Dissolution, etc..............................................68
8.13. Limitations on Sales and Leasebacks...........................68
8.14. Hedging Obligations...........................................68
8.15. Negative Pledge Clauses.......................................68
8.16. Change in Accountants.........................................69
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8.17. Limitations on Certain Restrictive Covenants..................69
8.18. Payment of Indebtedness.......................................69
ARTICLE IX
Events of Default and Acceleration
9.1. Events of Default.............................................70
9.2. Agent to Act..................................................73
9.3. Cumulative Rights.............................................73
9.4. No Waiver.....................................................73
9.5. Allocation of Proceeds........................................73
ARTICLE X
The Agent
10.1. Appointment, Powers, and Immunities...........................75
10.2. Reliance by Agent.............................................75
10.3. Defaults......................................................76
10.4. Rights as Lender..............................................76
10.5. Indemnification...............................................76
10.6. Non-Reliance on Agent and Other Lenders.......................77
10.7. Resignation of Agent..........................................77
10.8. Sharing of Payments, etc......................................77
10.9. Fees..........................................................78
ARTICLE XI
Miscellaneous
11.1. Assignments and Participations...............................79
11.2. Notices......................................................80
11.3. Right of Set-off; Adjustments................................82
11.4. Survival.....................................................82
11.5. Expenses.....................................................82
11.6. Amendments and Waivers.......................................83
11.7. Counterparts.................................................83
11.8. Termination..................................................83
11.9. Indemnification; Limitation of Liability.....................84
11.10. Severability.................................................85
11.11. Entire Agreement.............................................85
11.12. Agreement Controls...........................................86
11.13. Usury Savings Clause.........................................86
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11.14. Governing Law; Waiver of Jury Trial..........................86
11.15. Status of Debt...............................................87
11.16. Existing Letters of Credit...................................87
EXHIBIT A Applicable Commitment Percentages.....................A-1
EXHIBIT B Form of Assignment and Acceptance.....................B-1
EXHIBIT C Notice of Appointment (or Revocation) of Authorized
Representative........................................C-1
EXHIBIT D-1 Form of Borrowing Notice--Revolving Credit Loans......D-1-1
EXHIBIT D-2 Form of Borrowing Notice--Swing Line Loans............D-2-1
EXHIBIT E Form of Interest Rate Selection Notice................E-1
EXHIBIT F-1 Form of Revolving Note................................F-1-1
EXHIBIT F-2 Form of Swing Line Note...............................F-2-1
EXHIBIT G Form of Opinion of Borrower's Counsel.................G-1
EXHIBIT H Compliance Certificate................................H-1
EXHIBIT I Form of Subsidiary Guaranty...........................I-1
EXHIBIT J Terms of Subordination................................J-1
EXHIBIT K Form of Cash Collateral Account Agreement.............K-1
EXHIBIT L Confidentiality Agreement.............................L-1
Schedule 6.4 Subsidiaries and Investments in Other Persons.........S-1
Schedule 6.6 Indebtedness..........................................S-2
Schedule 8 Investment Guidelines.................................S-4
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of September 30, 1997 (the
"Agreement"), is made by and among DATA GENERAL CORPORATION, a Delaware
corporation (the "Borrower"), NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, a
national banking association organized and existing under the laws of the United
States, in its capacity as a Lender ("NationsBank"), and each other financial
institution executing and delivering a signature page hereto and each other
financial institution which may hereafter execute and deliver an instrument of
assignment with respect to this Agreement pursuant to Section 11.1 (hereinafter
such financial institutions may be referred to individually as a "Lender" or
collectively as the "Lenders"), the BANK OF NEW YORK, a New York chartered bank,
and FLEET NATIONAL BANK, a national banking association organized and existing
under the laws of the United States, each in their capacity as Co-agents for the
Lenders, and NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION, a national banking
association organized and existing under the laws of the United States, in its
capacity as agent for the Lenders (in such capacity, and together with any
successor agent appointed in accordance with the terms of Section 10.7 hereof,
the "Agent");
W I T N E S S E T H:
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WHEREAS, the Borrower has requested that the Lenders make available to
the Borrower a Revolving Credit Facility (as hereafter defined) of up to
$110,000,000, the proceeds of which are to be used to redeem certain existing
indebtedness and for working capital, capital expenditures, permitted
acquisitions and general corporate purposes and which shall include a letter of
credit subfacility of up to $15,000,000 for the issuance of standby and
commercial letters of credit and a swing line subfacility of up to $5,000,000;
and
WHEREAS, the Lenders are willing to make such revolving credit and
letter of credit facilities available to the Borrower and NationsBank is willing
to make the swing line facility available to the Borrower, all upon the terms
and conditions set forth herein;
NOW, THEREFORE, the Borrower, the Lenders and the Agent hereby agree as
follows:
ARTICLE I
Definitions and Terms
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1.1. Definitions.
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For the purposes of this Agreement, in additionto the
definitions set forth above, the following terms shall have the respective
meanings set forth below:
"Acquisition" means the acquisition of (i) a controlling
equity interest in another Person (including an option, warrant or
convertible or similar type security to acquire such a controlling
interest at the time it becomes exercisable by the holder thereof),
whether by purchase of such controlling equity interest or upon
exercise of an option or warrant for,
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or conversion of securities into, such equity interest, or (ii) all or
substantially all the assets of another Person or a line of business or
business segment of another Person.
"Advance" means any of a borrowing under the Revolving Credit
Facility consisting of a Base Rate Loan or a Eurodollar Rate Loan.
"Affiliate" means any Person (i) which directly or indirectly
through one or more intermediaries controls, or is controlled by, or is
under common control with the Borrower; or (ii) which beneficially owns
or holds 10% or more of any class of the outstanding voting stock (or
in the case of a Person which is not a corporation, 10% or more of the
equity interest) of the Borrower; or 10% or more of any class of the
outstanding voting stock (or in the case of a Person which is not a
corporation, 10% or more of the equity interest) of which is
beneficially owned or held by the Borrower. The term "control" means
the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether
through ownership of voting stock, by contract or otherwise.
"Applicable Commitment Percentage" means, with respect to each
Lender at any time, a fraction, the numerator of which shall be such
Lender's Revolving Credit Commitment and the denominator of which shall
be the Total Revolving Credit Commitment, which Applicable Commitment
Percentage for each Lender as of the Closing Date is as set forth in
Exhibit A; provided that the Applicable Commitment Percentage of each
Lender shall be increased or decreased to reflect any assignments to or
by such Lender effected in accordance with Section 11.1 hereof.
"Applicable Lending Office" means, for each Lender and for
each Type of Loan, the "Lending Office" of such Lender (or of an
affiliate of such Lender) designated for such Type of Loan on the
signature pages hereof or such other office of such Lender (or an
affiliate of such Lender) as such Lender may from time to time specify
to the Agent and the Borrower by written notice in accordance with the
terms hereof as the office by which its Loans of such Type are to be
made and maintained.
"Applicable Margin" means that percent per annum set forth
below, which shall be based upon the Consolidated Leverage Ratio for
the Four-Quarter Period most recently ended as specified below:
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Applicable Margin
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Consolidated Eurodollar Rate and
Leverage Ratio Letter of Credit Fee Base Rate Commitment Fee
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(a) Less than .75 to 1.00 .875% 0% .250%
(b) Less than 1.50 to 1.00
but greater than or equal
to .75 to 1.00 1.1250% 0% .350%
(c) Less than 2.25 to 1.00
but greater than or equal
to 1.50 to 1.00 1.250% 0% .375%
(d) Greater than or equal
to 2.25 to 1.00 1.375% .250% .500%
The Applicable Margin shall be established at the end of each fiscal
quarter of the Borrower (each, a "Determination Date"). Any change in
the Applicable Margin following each Determination Date shall be
determined based upon the computations set forth in the certificate
furnished to the Agent pursuant to Section 7.1(a)(ii) and Section
7.1(b)(ii) hereof, subject to review and approval of such computations
by the Agent, and shall be effective commencing on the date such
certificate is received until the date on which a new certificate is
delivered; provided however, if the Borrower shall fail to deliver any
such certificate within the time period required by Section 7.1 hereof,
then the Applicable Margin shall be 1.375% for Eurodollar Rate Loans
and the fee for Letters of Credit under Section 4.3 hereof, .250% for
Base Rate Loans and .500% for the Commitment Fee, in each case, from
the date such certificate was required to be delivered, until the
appropriate certificate is so delivered. From the Closing Date until
the date on which the certificate for the period ending December 31,
1997 is delivered, the Applicable Margin shall be 1.250% for Eurodollar
Rate Loans and the fee for Letters of Credit, 0% for Base Rate Loans
and .375% for the Commitment Fee.
"Applications and Agreements for Letters of Credit" means,
collectively, the Applications and Agreements for Letters of Credit, or
similar documentation, executed by the Borrower from time to time and
delivered to the Issuing Bank to support the issuance of Letters of
Credit.
"Assignment and Acceptance" shall mean an Assignment and
Acceptance in the form of Exhibit B (with blanks appropriately filled
in) delivered to the Agent in connection
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with an assignment of a Lender's interest under this Agreement pursuant
to Section 11.1 hereof.
"Authorized Representative" means any of the President, the
Chief Executive Officer, any Vice President, the Chief Financial
Officer, Treasurer and Controller of the Borrower or any other Person
expressly designated by the Board of Directors of the Borrower (or the
appropriate committee thereof) as an Authorized Representative of the
Borrower, as set forth from time to time in a certificate in the form
of Exhibit C.
"Available Revolving Credit Commitment" means an amount equal
to the excess, if any, of (a) the Total Revolving Credit Commitment
over (b) the aggregate Revolving Credit Outstandings.
"Base Rate" means, for any day, the rate per annum equal to
the sum of (a) the higher of (i) the Federal Funds Rate for such day
plus one-half of one percent (0.5%) and (ii) the Prime Rate for such
day plus (b) the Applicable Margin. Any change in the Base Rate due to
a change in the Prime Rate or the Federal Funds Rate shall be effective
on the effective date of such change in the Prime Rate or Federal Funds
Rate.
"Base Rate Loan" means a Revolving Loan for which the rate of
interest is determined by reference to the Base Rate.
"Base Rate Refunding Loan" means either (i) a Base Rate Loan
made to satisfy Reimbursement Obligations arising from a drawing under
a Letter of Credit or (ii) a Base Rate Loan made to pay NationsBank
with respect to Swing Line Outstandings;
"Board" means the Board of Governors of the Federal Reserve
System (or any successor body).
"Borrowing Notice" means the notice delivered by an Authorized
Representative in connection with an Advance under the Revolving Credit
Facility or a Swing Line Loan, in the forms attached hereto as Exhibits
D-1 and D-2, respectively;
"Business Day" means, (i) with respect to any Base Rate Loan,
any day which is not a Saturday, Sunday or a day on which banks in the
States of New York and Texas are authorized or obligated by law,
executive order or governmental decree to be closed and, (ii) with
respect to any Eurodollar Rate Loan, any day which is a Business Day,
as described above, and on which the relevant international financial
markets are open for the transaction of business contemplated by this
Agreement in London, England, New York, New York and Dallas, Texas.
"Capital Expenditures" means, with respect to the Borrower and
its Subsidiaries, for any period the sum of (without duplication) (i)
all expenditures (whether paid in cash or accrued as liabilities) by
the Borrower or any Subsidiary during such period for items
4
that would be classified as "property, plant or equipment" or
comparable items on the consolidated balance sheet of the Borrower and
its Subsidiaries, including without limitation all transactional costs
incurred in connection with such expenditures provided the same have
been capitalized, excluding, however, the amount of any Capital
Expenditures paid for with proceeds of casualty insurance as evidenced
in writing and submitted to the Agent together with any compliance
certificate delivered pursuant to Section 7.1(a) or (b) hereof, and
(ii) with respect to any Capital Lease entered into by the Borrower or
its Subsidiaries during such period, the present value of the lease
payments due under such Capital Lease over the term of such Capital
Lease applying a discount rate equal to the interest rate provided in
such lease (or in the absence of a stated interest rate, that rate used
in the preparation of the financial statements described in Section
7.1(a)), all the foregoing in accordance with GAAP applied on a
Consistent Basis.
"Capital Leases" means all leases which have been or should be
capitalized in accordance with GAAP as in effect from time to time
including Statement No. 13 of the Financial Accounting Standards Board
and any successor thereof.
"Cash Collateral Account Agreement" means a Cash Collateral
Account Agreement between the Borrower and the Agent in the form of
Exhibit K hereto, as amended, modified or supplemented from time to
time.
"Change of Control" means, at any time:
(i) any "person" or "group" (each as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act) either (A) becomes
the "beneficial owner" (as defined in Rule 13d-3 of the
Exchange Act), directly or indirectly, of Voting Stock of the
Borrower (or securities convertible into or exchangeable for
such Voting Stock) representing 20% or more of the combined
voting power of all Voting Stock of the Borrower (on a fully
diluted basis) or (B) otherwise has the ability, directly or
indirectly, to elect a majority of the board of directors of
the Borrower; or
(ii) during any period of up to 24 consecutive
months, commencing on the Closing Date, individuals who at the
beginning of such 24-month period were directors of the
Borrower shall cease for any reason (other than (A) the death,
disability or retirement of a director or (B) the death,
disability or retirement of an officer of the Borrower that is
serving as a director at such time so long as another officer
of the Borrower replaces such Person as a director) to
constitute a majority of the board of directors of the
Borrower; or
(iii) any Person or two or more Persons acting in
concert shall have acquired by contract or otherwise, or shall
have entered into a contract or arrangement that, upon
consummation thereof, will result in its or their acquisition
of the power to exercise, directly or indirectly, a
controlling influence on the management or policies of the
Borrower.
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"Closing Date" means the date as of which this Agreement is
executed by the Borrower, the Lenders and the Agent and on which the
conditions set forth in Section 4.1 have been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended,
and any regulations promulgated thereunder.
"Confidentiality Agreement" means a Confidentiality Agreement
in the form of Exhibit L hereto;
"Consistent Basis" in reference to the application of GAAP
means the accounting principles observed in the period referred to are
comparable in all material respects to those applied in the preparation
of the audited financial statements of the Borrower referred to in
Section 6.6(a);
"Consolidated Accounts Receivable" means the amount of all
accounts receivable of the Borrower and its Subsidiaries less all
reserves with respect thereto, including without limitation reserves
for past due and doubtful accounts, determined on a consolidated basis
in accordance with GAAP applied on a Consistent Basis.
"Consolidated Accounts Payable" means the amount of all unpaid
obligations of the Borrower and its Subsidiaries for the payment of the
price of goods purchased or leased (other than pursuant to a Capital
Lease) by or services rendered to the Borrower or the Subsidiaries and
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis.
"Consolidated EBIT" means, with respect to the Borrower and
its Subsidiaries for any Four-Quarter Period ending on the date of
computation, the difference of Consolidated EBITDA less amortization
and depreciation, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated EBITDA" means, with respect to the Borrower and
its Subsidiaries for any Four-Quarter Period ending on the date of
computation thereof, the sum of, without duplication, (i) Consolidated
Net Income, (ii) Consolidated Interest Expense, (iii) taxes on income,
(iv) amortization, and (v) depreciation, all determined on a
consolidated basis in accordance with GAAP applied on a Consistent
Basis; provided, however, that for each of the first four fiscal
quarters following any Acquisition, the calculation of Consolidated
EBITDA for each Four-Quarter Period ending on the last day of each such
fiscal quarter shall include the historical financial performance of
the acquired business for that portion of such Four-Quarter Period
occurring prior to such Acquisition.
"Consolidated Fixed Charge Ratio" means, with respect to the
Borrower and its Subsidiaries for any Four-Quarter Period ending on the
date of computation thereof, the
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ratio of (i) Consolidated EBIT plus Consolidated Lease Payments for
such period, to (ii) Consolidated Fixed Charges for such period.
"Consolidated Fixed Charges" means, with respect to Borrower
and its Subsidiaries for any Four-Quarter Period ending on the date of
computation thereof, the sum of, without duplication, (i) Consolidated
Interest Expense, and (ii) Consolidated Lease Payments for such period,
all determined on a consolidated basis in accordance with GAAP applied
on a Consistent Basis.
"Consolidated Funded Indebtedness" means, with respect to the
Borrower and its Subsidiaries, at any time as of which the amount
thereof is to be determined, the sum of (i) Indebtedness for Money
Borrowed of the Borrower and its Subsidiaries at such time, (ii) all
direct Guaranties of Indebtedness for Money Borrowed of a Person other
than a Consolidated Subsidiary at such time and (iii) the face amount
of all outstanding letters of credit issued for the account of the
Borrower or any of its Subsidiaries and all obligations (to the extent
not duplicative) arising under such letters of credit, all determined
on a consolidated basis in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis, less up to
$10,000,000 in aggregate face amount of letters of credit issued in
support of performance of Subsidiaries under agreements entered into in
the ordinary course of business.
"Consolidated Interest Expense" means, with respect to any
period of computation thereof, the gross interest expense of the
Borrower and its Subsidiaries for such period, including without
limitation (i) the current amortized portion of debt discounts to the
extent included in gross interest expense, (ii) the current amortized
portion of all fees (including fees payable in respect of any Swap
Agreement) payable in connection with the incurrence of Indebtedness to
the extent included in gross interest expense and (iii) the portion of
any payments made in connection with Capital Leases allocable to
interest expense, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated Lease Payments" means the gross amount of all
lease or rental payments, whether or not characterized as rent, of the
Borrower and its Subsidiaries, excluding payments in respect of Capital
Leases constituting Indebtedness, all determined on a consolidated
basis in accordance with GAAP applied on a Consistent Basis.
"Consolidated Leverage Ratio" means, as of the date of
computation thereof, the ratio of (i) Consolidated Funded Indebtedness
(as determined as at such date) to (ii) Consolidated EBITDA (for the
Four-Quarter Period ending on (or most recently prior to) such date).
"Consolidated Liquidity Ratio" means, as of the date of
computation thereof, the ratio of (i) the sum of cash plus Eligible
Securities of the Borrower and its Subsidiaries plus Consolidated
Accounts Receivable to (ii) the sum of Consolidated Funded
7
Indebtedness less the principal amount of all Indebtedness outstanding
under the Indenture plus Consolidated Accounts Payable.
"Consolidated Net Income" means, for any period of computation
thereof, the gross revenues from operations and income of the Borrower
and its Subsidiaries (including payments received by the Borrower and
its Subsidiaries of interest income and dividends and distributions
made in the ordinary course of their businesses by Persons in which
investment is permitted pursuant to this Agreement and not related to
an extraordinary event), less all operating and non-operating expenses
of the Borrower and its Subsidiaries including taxes on income, all
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis; but excluding (for all purposes other than compliance
with Section 8.1(c) hereof) as income: (i) net gains on the sale,
conversion or other disposition of capital assets, (ii) net gains on
the acquisition, retirement, sale or other disposition of capital stock
and other securities of the Borrower or its Subsidiaries, (iii) net
gains on the collection of proceeds of life insurance policies, (iv)
any write-up of any asset, and (v) any other net gain or credit of an
extraordinary nature as determined in accordance with GAAP applied on a
Consistent Basis.
"Consolidated Shareholders' Equity" means, as of any date on
which the amount thereof is to be determined, the sum of the following
in respect of the Borrower and its Subsidiaries (determined on a
consolidated basis and excluding any upward adjustment after the
Closing Date due to revaluation of assets): (i) the amount of issued
and outstanding share capital, plus (ii) the amount of additional
paid-in capital and retained earnings (or, in the case of a deficit,
minus the amount of such deficit), plus (iii) the amount of any foreign
currency translation adjustment (if positive, or, if negative, minus
the amount of such translation adjustment), plus (iv) the amount of
unrealized gain (or if a loss, minus such amount) on marketable
securities plus (v) software research and development costs required to
be capitalized, minus (v) the amount of any treasury stock, all as
determined in accordance with GAAP applied on a Consistent Basis.
"Consolidated Subsidiary" means any Subsidiary of the Borrower
whose financial information and operations are required to be
consolidated in the financial statements of the Borrower pursuant to
GAAP.
"Consolidated Tangible Net Worth" means, as of any date on
which the amount thereof is to be determined, Consolidated
Shareholders' Equity minus (without duplication of deductions in
respect of items already deducted in arriving at Consolidated
Shareholders' Equity) (i) all reserves (other than contingency reserves
not allocated to any particular purpose), including without limitation
reserves for depreciation, depletion, amortization, obsolescence,
deferred income taxes, insurance and inventory valuation, and (ii) the
net book value of all assets which would be treated as intangible
assets, such as (without limitation) goodwill (whether representing the
excess of cost over book value of assets acquired or otherwise),
unamortized debt discount and expense, patents, trademarks,
8
trade names, copyrights, franchises and licenses, all as determined on
a consolidated basis in accordance with GAAP applied on a Consistent
Basis.
"Consolidated Total Assets" means, as of any date on which the
amount thereof is to be determined, the net book value of all assets of
the Borrower and its Subsidiaries as determined on a consolidated basis
in accordance with GAAP applied on a Consistent Basis.
"Contingent Obligation" of any Person means all Guaranties and
other contingent liabilities required (or which, upon the creation or
incurring thereof, would be required) to be included in the financial
statements (including footnotes) of such Person in accord ance with
GAAP applied on a Consistent Basis, including Statement No. 5 of the
Financial Accounting Standards Board, all Hedging Obligations and any
obligation of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person (the
"primary obligor") in any manner, whether directly or indirectly,
including obligations of such Person however incurred:
(1) to purchase such Indebtedness or other obligation
or any property or assets constituting security therefor;
(2) to advance or supply funds in any manner (i) for
the purchase or payment of such Indebtedness or other
obligation, or (ii) to maintain a minimum working capital, net
worth or other balance sheet condition or any income statement
condition of the primary obligor;
(3) to grant or convey any lien, security interest,
pledge, charge or other encumbrance on any property or assets
of such Person to secure payment of such Indebtedness or other
obligation;
(4) to lease property or to purchase securities or
other property or services primarily for the purpose of
assuring the owner or holder of such Indebtedness or
obligation of the ability of the primary obligor to make
payment of such Indebtedness or other obligation; or
(5) otherwise to assure the owner of the Indebtedness
or such obligation of the primary obligor against loss in
respect thereof.
"Continue", "Continuation", and "Continued" shall refer to the
continuation pursuant to Section 2.8 hereof of a Eurodollar Rate Loan
of one Type as a Eurodollar Rate Loan of the same Type from one
Interest Period to the next Interest Period.
"Convert", "Conversion", and "Converted" shall refer to a
conversion pursuant to Section 2.8 or Article IV hereof of one Type of
Loan into another Type of Loan.
9
"Cost of Acquisition" means, with respect to any Acquisition,
as at the date of entering into any agreement therefor, the sum of the
following (without duplication): (i) the value of the capital stock,
warrants or options to acquire capital stock of Borrower or any
Subsidiary to be transferred in connection therewith, (ii) the amount
of any cash and fair market value of other property (excluding property
described in clause (i) and the unpaid principal amount of any debt
instrument) given as consideration, (iii) the amount (determined by
using the face amount or the amount payable at maturity, whichever is
greater) of any Indebtedness incurred, assumed or acquired by the
Borrower or any Subsidiary in connection with such Acquisition, (iv)
all additional purchase price amounts in the form of earnouts and other
contingent obligations that should be recorded on the financial
statements of the Borrower and its Subsidiaries in accordance with
GAAP, (v) all amounts paid in respect of covenants not to compete,
consulting agreements that should be recorded on financial statements
of the Borrower and its Subsidiaries in accordance with GAAP, and other
affiliated contracts in connection with such Acquisition, (vi) the
aggregate fair market value of all other consideration given by the
Borrower or any Subsidiary in connection with such Acquisition, and
(vii) out of pocket transaction costs for the services and expenses of
attorneys, accountants and other consultants incurred in effecting such
transaction, and other similar transaction costs so incurred. For
purposes of determining the Cost of Acquisition for any transaction,
(A) the capital stock of the Borrower shall be valued (I) at its market
value as reported on the New York Stock Exchange or any national
securities exchange or automated national market system with respect to
shares that are freely tradeable, and (II) with respect to shares that
are not freely tradeable, as determined by a committee composed of the
disinterested members of the Board of Directors of the Borrower and, if
requested by the Agent, determined to be a reasonable valuation by the
independent public accountants referred to in Section 7.1(a) hereof,
(B) the capital stock of any Subsidiary shall be valued as determined
by a committee composed of the disinterested members of the Board of
Directors of such Subsidiary and, if requested by the Agent, determined
to be a reasonable valuation by the independent public accountants
referred to in Section 7.1(a) hereof, and (C) with respect to any
Acquisition accomplished pursuant to the exercise of options or
warrants or the conversion of securities, the Cost of Acquisition shall
include both the cost of acquiring such option, warrant or convertible
security as well as the cost of exercise or conversion.
"Credit Facilities" means, collectively, the Revolving Credit
Facility and the Letter of Credit Facility.
"Credit Party" means, collectively or individually as the
context may indicate, the Borrower, and each Guarantor.
"Default" means any event or condition which, with the giving
or receipt of notice or lapse of time or both, would constitute an
Event of Default hereunder.
"Default Rate" means (i) with respect to each Eurodollar Rate
Loan, until the end of the Interest Period applicable thereto, a rate
of two percent (2%) above the Eurodollar rate applicable to such Loan,
10
and thereafter a rate of interest perannum which shall be two percent
(2%) above the Base Rate, (ii) with respect to each Base Rate Loan and
Reimbursement Obligations, a rate of interest per annum which shall be
two percent (2%) above the Base Rate and (iii) in any case, the maximum
rate permitted by applicable law, if lower.
"Dollars" and the symbol "$" means dollars constituting legal
tender for the payment of public and private debts in the United States
of America.
"Domestic" means, with respect to any Subsidiary, an entity
which is organized under the laws of the District of Columbia or one of
the states comprising the United States of America.
"Eligible Assignee" means (i) a Lender, (ii) an affiliate of a
Lender, and (iii) any other Person approved by the Agent and, unless an
Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 11.1 hereof, the
Borrower, such approval not to be unreasonably withheld or delayed by
the Borrower, provided, however, that neither the Borrower nor an
Affiliate shall qualify as an Eligible Assignee.
"Eligible Securities" means the following obligations and any
other obligations previously approved in writing by the Agent:
(a) Government Securities maturing no later than two
years from the date of purchase thereof;
(b) obligations of any corporation organized under
the laws of any state of the United States of America or under
the laws of any other nation, payable in the United States of
America, having a maturity and rating complying with the
investment guidelines for such obligations set forth on
Schedule 8 hereto;
(c) interest bearing demand or time deposits issued
by any Lender or certificates of deposit maturing within one
year from the date of issuance thereof and issued by a bank or
trust company organized under the laws of the United States or
of any state thereof having capital surplus and undivided
profits aggregating at least $400,000,000 and having a rating
complying with the investment guidelines for such deposits set
forth on Schedule 8 hereto;
(d) Municipal Obligations maturing no later than one
year from the date of issuance thereof;
(e) Money Market Funds with minimum net assets of
$300,000,000 and a dollar weighted portfolio maturity of 90
days or less as stated in the most recent report to
shareholders of such Money Market Funds.
11
"Employee Benefit Plan" means any employee benefit plan within
the meaning of Section 3(3) of ERISA which (i) is maintained for
employees of the Borrower or any of its ERISA Affiliates or is assumed
by the Borrower or any of its ERISA Affiliates in connection with any
Acquisition or (ii) has at any time within the last six (6) calendar
years been maintained for the employees of the Borrower or any current
or former ERISA Affiliate.
"Environmental Laws" means any federal, state or local
statute, law, ordinance, code, rule, regulation, order, decree, permit
or license regulating, relating to, or imposing liability or standards
of conduct concerning, any environmental matters or conditions,
environmental protection or conservation, including without limitation,
the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended; the Superfund Amendments and Reauthorization
Act of 1986, as amended; the Resource Conservation and Recovery Act, as
amended; the Toxic Substances Control Act, as amended; the Clean Air
Act, as amended; the Clean Water Act, as amended; together with all
regulations promulgated thereunder, and any other "Superfund" or
"Superlien" law.
"Equity Offering" means a public or private offering of equity
securities (including, without limitation, any security or investment
not constituting Indebtedness exchangeable, exercisable or convertible
for or into, or otherwise entitling the holder to receive, equity
securities) of the Borrower or any Subsidiary (other than securities
issued to the Borrower or another Subsidiary).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute and all
rules and regulations promulgated thereunder.
"ERISA Affiliate", as applied to the Borrower, means any
Person or trade or business which is a member of a group which is under
common control with the Borrower, who together with the Borrower, is
treated as a single employer within the meaning of Section 414(b) and
(c) of the Code.
"Eurodollar Rate Loan" means a Loan for which the rate of
interest is determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means the interest rate per annum calculated
according to the following formula:
Interbank Offered Rate
Eurodollar Rate = ---------------------- + Applicable Margin
1 - Reserve Requirement
"Event of Default" means any of the occurrences set forth as
such in Section 9.1.
12
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder.
"Existing Letters of Credit" means all letters of credit
issued and outstanding under the Existing Letter of Credit Agreement.
"Existing Letter of Credit Agreement" means that certain
Letter of Credit and Reimbursement Agreement dated as of December 21,
1994 by and among the Agent, the Borrower and certain lenders party
thereto under which the Existing Letters of Credit were issued.
"Facility Termination Date" means such date as all of the
following shall have occurred: (a) the Borrower shall have permanently
terminated the Revolving Credit Facility by payment in full of all
Revolving Credit Outstandings, Swing Line Outstandings and Letter of
Credit Outstandings, together with all accrued and unpaid interest
thereon, except for such issued and undrawn Letters of Credit as have
been fully cash collateralized in a manner consistent with the terms of
Section 9.1(l)(B) hereof, (b) all Swap Agreements shall have been
terminated, expired or cash collateralized in a manner substantially
similar to the terms of the Cash Collateral Account Agreement, (c) all
Revolving Credit Commitments and Letter of Credit Commitments shall
have terminated or expired and (d) the Borrower shall have fully,
finally and irrevocably paid and satisfied in full all Obligations
(other than Obligations consisting of continuing indemnities and other
contingent Obligations of the Borrower or any Guarantor that may be
owing to the Lenders pursuant to the Loan Documents and expressly
survive termination of this Agreement).
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided
that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and
(b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate
charged to the Agent (in its individual capacity) on such day on such
transactions as determined by the Agent.
"Fiscal Year" means the annual fiscal period of the Borrower
ending on the last Saturday in each September.
"Foreign Benefit Law" means any applicable statute, law,
ordinance, code, rule, regulation, order or decree of any foreign
nation or any province, state, territory, protectorate or other
political subdivision thereof regulating, relating to, or imposing
liability or standards of conduct concerning, any Employee Benefit
Plan.
13
"Four-Quarter Period" means a period of four full consecutive
fiscal quarters of the Borrower and its Subsidiaries, taken together as
one accounting period.
"GAAP" or "Generally Accepted Accounting Principles" means
generally accepted accounting principles, being those principles of
accounting set forth in pronouncements of the Financial Accounting
Standards Board, the American Institute of Certified Public Accountants
or which have other substantial authoritative support and are
applicable in the circumstances as of the date of a report.
"Government Securities" means direct obligations of, or
obligations the timely payment of principal and interest on which are
fully and unconditionally guaranteed by, the United States of America
or any federal department or agency thereof.
"Governmental Authority" shall mean any Federal, state,
municipal, national or other governmental department, commission,
board, bureau, court, agency or instrumentality or political
subdivision thereof or any entity or officer exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to any government or any court, in each case whether
associated with a state of the United States, the United States, or a
foreign entity or government.
"Guaranties" means all obligations of the Borrower or any
Subsidiary directly or indirectly guaranteeing, or in effect
guaranteeing, any Indebtedness or other obligation of any other Person.
"Guarantors" means, at any date, all Domestic Subsidiaries
that are Material Subsidiaries on the Closing Date and all further
Domestic Subsidiaries who are required to be parties to a Subsidiary
Guaranty at such date pursuant to Section 7.19 hereof.
"Hazardous Material" means and includes any pollutant,
contaminant, or hazardous, toxic or dangerous waste, substance or
material (including without limitation petroleum products,
asbestos-containing materials and lead), the generation, handling,
storage, transportation, disposal, treatment, release, discharge or
emission of which is subject to any Environmental Law.
"Hedging Obligations" means any and all obligations of the
Borrower or any Subsidiary, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements, devices or
arrangements designed to protect at least one of the parties thereto
from the fluctuations of interest rates, exchange rates or forward
rates applicable to such party's assets, liabilities or currency
exchange transactions, including, but not limited to, Dollar-
denominated or cross-currency interest rate exchange agreements,
forward currency exchange agreements, interest rate cap or collar
protection agreements, forward rate currency or interest rate options,
puts, warrants and those commonly known as interest rate
14
"swap" agreements; and (ii) any and all cancellations, buybacks,
reversals, terminations or assignments of any of the foregoing.
"Indebtedness" means with respect to any Person, without
duplication, all Indebtedness for Money Borrowed, all indebtedness of
such Person for the acquisition of property, all executory obligations
arising under Hedging Obligations, all indebtedness secured by any Lien
on the property of such Person whether or not such indebtedness is
assumed, all liability of such Person by way of endorsements (other
than for collection or deposit in the ordinary course of business), all
Guaranties, that portion of obligations with respect to Capital Leases
and other items which in accordance with GAAP is required to be
classified as a liability on a balance sheet; but excluding all
accounts payable in the ordinary course of business so long as payment
therefor is due within one year; provided that in no event shall the
term Indebtedness include surplus and retained earnings, lease
obligations (other than pursuant to Capital Leases), reserves for
deferred income taxes and investment credits, other deferred credits or
reserves.
"Indebtedness for Money Borrowed" means with respect to any
Person, without duplication, all indebtedness in respect of money
borrowed, including without limitation all Capital Leases and the
deferred purchase price of any property or asset, evidenced by a
promissory note, bond, debenture or similar written obligation for the
payment of money (including conditional sales or similar title
retention agreements), other than trade payables incurred in the
ordinary course of business.
"Indenture" means that certain Indenture dated as of May 21,
1997 pursuant to which the Borrower has issued its 6.0% subordinated
convertible debentures due 2004 in an original aggregate principal
amount of $212,750,000.
"Interbank Offered Rate" means, with respect to any Eurodollar
Rate Loan for the Interest Period applicable thereto, the rate per
annum (rounded upwards, if necessary), to the nearest 1/100 of 1%)
appearing on Telerate Page 3750 (or any successor page) as the London
interbank offered rate for deposits in Dollars at approximately 11:00
A.M. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period. If for
any reason such rate is not available, the term "Interbank Offered
Rate" shall mean, with respect to any Eurodollar Rate Loan for the
Interest Period applicable thereto, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 A.M. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to
such Interest Period, provided, however; if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.
"Interest Period" means, for each Eurodollar Rate Loan, a
period commencing on the date such Eurodollar Rate Loan is made or
Converted and ending, at the Borrower's option, on the date one, two,
three or six months thereafter as notified to the Agent by the
15
Authorized Representative three (3) Business Days prior to the
beginning of such Interest Period; provided, that,
(i) if the Authorized Representative fails to notify
the Agent of the length of an Interest Period three (3)
Business Days prior to the first day of such Interest Period,
the Loan for which such Interest Period was to be determined
shall be deemed to be a Base Rate Loan as of the first day
thereof;
(ii) if an Interest Period for a Eurodollar Rate Loan
would end on a day which is not a Business Day, such Interest
Period shall be extended to the next Business Day (unless such
extension would cause the applicable Interest Period to end in
the succeeding calendar month, in which case such Interest
Period shall end on the next preceding Business Day);
(iii) any Interest Period which 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 a calendar month;
(iv) no Interest Period shall extend past the Stated
Termination Date; and
(v) there shall not be more than six (6) Interest
Periods in effect on any day.
"Interest Rate Selection Notice" means the written notice
delivered by an Authorized Representative in connection with the
election of a subsequent Interest Period for any Eurodollar Rate Loan
or the Conversion of any Eurodollar Rate Loan into a Base Rate Loan or
the Conversion of any Base Rate Loan into a Eurodollar Rate Loan, in
the form of Exhibit E.
"Issuing Bank" means NationsBank as issuer of Letters of
Credit under Article III hereof and any successor thereto that is a
Lender.
"Letter of Credit" means a standby or commercial letter of
credit issued by the Issuing Bank pursuant to Article III hereof for
the account of the Borrower in favor of a Person advancing credit to or
securing an obligation for the benefit of the Borrower or its
Subsidiaries.
"Letter of Credit Commitment" means, with respect to each
Lender, the obligation of such Lender to acquire Participations in
respect of Letters of Credit and Reimbursement Obligations up to an
aggregate amount at any one time outstanding equal to such Lender's
Applicable Commitment Percentage of the Total Letter of Credit
Commitment as the same may be increased or decreased from time to time
pursuant to this Agreement.
16
"Letter of Credit Facility" means the facility described in
Article III hereof providing for the issuance by the Issuing Bank for
the account of the Borrower of Letters of Credit in an aggregate stated
amount at any time outstanding not exceeding the Total Letter of Credit
Commitment.
"Letter of Credit Outstandings" means, as of any date of
determination, the aggregate amount available to be drawn under all
Letters of Credit plus any Reimbursement Obligations then outstanding.
"Lien" means any interest in property securing any obligation
owed to, or a claim by, a Person other than the owner of the property,
whether such interest is based on the common law, statute or contract,
and including but not limited to the lien or security interest arising
from a mortgage, encumbrance, pledge, security agreement, conditional
sale or trust receipt or a lease, consignment or bailment for security
purposes. For the purposes of this Agreement, the Borrower and any
Subsidiary shall be deemed to be the owner of any property which it has
acquired or holds subject to a conditional sale agreement, financing
lease, or other arrangement pursuant to which title to the property has
been retained by or vested in some other Person for security purposes.
"Loan" or "Loans" means any of the Revolving Loans.
"Loan Documents" means this Agreement, the Notes, the
Subsidiary Guaranties, the Cash Collateral Account Agreement, the
Applications and Agreements for Letter of Credit, and all other
instruments and documents heretofore or hereafter executed and
delivered in favor of any Lender or the Agent in connection with the
Loans made and transactions contemplated under this Agreement, as the
same may be amended, supplemented or replaced from the time to time.
"Material Adverse Effect" means a material adverse effect on
(i) the business, properties, operations or condition, financial or
otherwise, or prospects of the Borrower and its Subsidiaries, taken as
a whole, (ii) the ability of any Credit Party to pay or perform its
respective obligations, liabilities and indebtedness under the Loan
Documents as such payment or performance becomes due in accordance with
the terms thereof, or (iii) the rights, powers and remedies of the
Agent or any Lender under any Loan Document or the validity, legality
or enforceability thereof.
"Material Subsidiary" means any direct or indirect Domestic
Subsidiary of the Borrower which (i) has total assets equal to or
greater than 5% of Consolidated Total Assets (calculated as of the most
recent fiscal period with respect to which the Agent shall have
received financial statements required to be delivered pursuant to
Sections 7.1(a) or (b) (or if prior to delivery of any financial
statements pursuant to such Sections, then calculated with respect to
the Fiscal Year end financial statements referenced in Section 6.6)
(the "Required Financial Information")) or (ii) has income equal to or
greater than 5% of Consolidated Net Income (calculated for the most
recent period for which the Agent has
17
received the Required Financial Information); provided, however, that
notwithstanding the foregoing, the term "Material Subsidiaries" shall
mean Domestic Subsidiaries of the Borrower that together with the
Borrower account for not less than 70% of Consolidated Total Assets
(calculated as described above) and 90% of Consolidated Net Income;
provided further that if more than one combination of Domestic
Subsidiaries satisfies such threshold, then those Domestic Subsidiaries
so determined to be "Material Subsidiaries" shall be specified by the
Borrower.
"Money Market Funds" means open-ended mutual funds that (i)
invest in first tier commercial paper, banker's acceptances, repurchase
agreements, government securities, certificates of deposit and other
highly liquid securities paying money market rates of interest, (ii)
seek to maintain a constant net asset value of $1.00 per share and
(iii) are rated AAA or better by S&P.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate is making, or is accruing an obligation to make,
contributions or has made, or been obligated to make, contributions
within the preceding six (6) Fiscal Years.
"Municipal Obligations" means general obligations issued by,
and supported by the full taxing authority of, any state of the United
States of America or of any municipal corporation or other public body
organized under the laws of any such state which are rated A-1 or AA-
or better by S&P and P-1 or Aa3 or better by Moody's.
"Nationally Recognized Standing" means with respect to any
firm of certified public accountants, any "Big Six" accounting firm or
other firm as may be recognized in writing as acceptable to the Agent.
"NationsBank" means NationsBank of Texas, National Association
"NCMI" means NationsBanc Capital Markets, Inc .and its
successors.
"Net Proceeds" means cash payments received by the Borrower
from an Equity Offering as and when received, net of all legal,
accounting, banking and underwriting fees and expenses, commissions,
discounts and other issuance expenses incurred in connection therewith
and all taxes required to be paid or accrued as a consequence of such
issuance.
"Note or Notes" means the Revolving Notes and the Swing Line
Notes.
"Obligations" means the obligations, liabilities and
Indebtedness of the Borrower with respect to (i) the principal and
interest on the Loans as evidenced by the Notes, (ii) the Reimbursement
Obligations and otherwise in respect of the Letters of Credit, (iii)
all
18
liabilities of Borrower to any Lender which arise under a Swap
Agreement, and (iv) the payment and performance of all other
obligations, liabilities and Indebtedness of the Borrower to the
Lenders, the Agent or NCMI hereunder, under any one or more of the
other Loan Documents or with respect to the Loans.
"Organizational Action" means with respect to any corporation,
limited liability company, partnership, limited partnership, limited
liability partnership or other legally authorized incorporated or
unincorporated entity, any corporate, organizational, partnership
action (including any required shareholder, member or partner action)
or other similar official action, as applicable, taken by such entity.
"Organizational Documents" means with respect to any
corporation, limited liability company, partnership, limited
partnership, limited liability partnership or other legally authorized
incorporated or unincorporated entity, the articles of incorporation,
certificate of incorporation, articles of organization, certificate of
limited partnership or other applicable organizational or charter
documents relating to the creation of such entity.
"Operating Documents" means with respect to any corporation,
limited liability company, partnership, limited partnership, limited
liability partnership or other legally authorized incorporated or
unincorporated entity, the bylaws, operating agreement, partnership
agreement, limited partnership agreement or other applicable documents
relating to the operation, governance or management of such entity.
"Outstandings" means, collectively, at any date, the Letter of
Credit Outstandings, Swing Line Outstandings and Revolving Credit
Outstandings on such date.
"Participation" means, (i) with respect to any Lender (other
than NationsBank) in connection with a Swing Line Loan, the extension
of credit represented by the participation of such Lender hereunder in
the liability of NationsBank in respect of such Swing Line Loan and
(ii) with respect to any Lender (other than the Issuing Bank) in
connection with a Letter of Credit, the extension of credit represented
by the participation of such Lender hereunder in the liability of the
Issuing Bank in respect of a Letter of Credit issued by the Issuing
Bank in accordance with the terms hereof;
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" means any employee pension benefit plan within
the meaning of Section 3(2) of ERISA, other than a Multiemployer Plan,
which is subject to the provisions of Title IV of ERISA or Section 412
of the Code and which (i) is maintained for employees of the Borrower
or any of its ERISA Affiliates or is assumed by the Borrower or any of
its ERISA Affiliates in connection with any Acquisition or (ii) has at
any time been maintained for the employees of the Borrower or any
current or former ERISA Affiliate.
19
"Permitted Liens" has the meaning given to such term in
Section 8.3 hereof.
"Person" means an individual, partnership, corporation, trust,
unincorporated organization, association, joint venture or a government
or agency or political subdivision thereof.
"Prime Rate" means the per annum rate of interest established
from time to time by NationsBank as its prime rate, which rate may not
be the lowest rate of interest charged by NationsBank to its customers.
"Principal Office" means the principal office of NationsBank,
presently located at 000 Xxxx Xxxxxx, XX0-000-00-00, Xxxxxx, Xxxxx
00000, Attention: Agency Services, or such other office and address as
the Agent may from time to time designate.
"Regulation D" means Regulation D of the Board as the same may
be amended or supplemented from time to time.
"Reimbursement Obligation" shall mean at any time, the
obligation of the Borrower with respect to any Letter of Credit to
reimburse the Issuing Bank and the Lenders to the extent of their
respective Participations (including by the receipt by the Issuing Bank
of proceeds of Base Rate Refunding Loans pursuant to Section 4.2) for
amounts theretofore paid by the Issuing Bank pursuant to a drawing
under such Letter of Credit.
"Required Financial Information" has the meaning given to such
term in the definition of "Material Subsidiary."
"Required Lenders" means, as of any date, Lenders on such date
having Credit Exposures (as defined below) aggregating in excess of 50%
of the aggregate Credit Exposures of all the Lenders on such date. For
purposes of the preceding sentence, the amount of the "Credit Exposure"
of each Lender shall be equal at all times (a) other than following the
occurrence and during the continuance of an Event of Default, to its
Revolving Credit Commitment, and (b) following the occurrence and
during the continuance of an Event of Default, to the sum of (i) the
amount of such Lender's Applicable Commitment Percentage of Revolving
Credit Outstandings, plus (ii) the amount of such Lender's Applicable
Commitment Percentage of Swing Line Outstandings and plus (iii) the
amount of such Lender's Applicable Commitment Percentage of Letter of
Credit Outstandings; provided that, for the purpose of this definition
only, (x) if any Lender shall have failed to fund its Applicable
Commitment Percentage of any Advance, the Revolving Credit Commitment
of such Lender shall be deemed reduced by the amount it so failed to
fund for so long as such failure shall continue and such Lender's
Credit Exposure attributable to such failure shall be deemed held by
any Lender making more than its Applicable Commitment Percentage of
such Advance to the extent it covers such failure, (y) if any Lender
shall have failed to pay to the Issuing Bank upon demand its Applicable
Commitment Percentage of any drawing under any Letter of Credit
resulting in an
20
outstanding Reimbursement Obligation, such Lender's Credit Exposure
attributable to such Letter of Credit Outstandings shall be deemed to
be held by Issuing Bank and (z) if any Lender shall have failed to pay
to NationsBank upon demand its Applicable Commitment Percentage of any
Swing Line Loan when required pursuant to Section 2.13(c), such
Lender's Credit Exposure attributable to all Swing Line Outstandings
shall be deemed to be held by NationsBank.
"Responsible Officer" means, the Chief Executive Officer,
Chief Financial Officer, President or General Counsel of the Borrower
or, with respect to matters relating to specific areas of the
Borrower's business, each executive officer of the Borrower managing or
responsible for oversight of such area.
"Reserve Requirement" means, at any time, the maximum rate at
which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained
under regulations issued from time to time by the Board of Governors of
the Federal Reserve System (or any successor) by member banks of the
Federal Reserve System against "Eurocurrency liabilities" (as such term
is used in Regulation D). Without limiting the effect of the foregoing,
the Reserve Requirement shall reflect any other reserves required to be
maintained by such member banks with respect to (i) any category of
liabilities which includes deposits by reference to which the
Eurodollar Rate is to be determined, or (ii) any category of extensions
of credit or other assets which include Eurodollar Rate Loans. The
Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
"Restricted Payment" means (a) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of Borrower or any of its Subsidiaries (other than those
payable or distributable solely to the Borrower) now or hereafter
outstanding, except a dividend or other distribution payable (i) solely
in shares of a class of stock to the holders of that class or (ii) in
shares of common stock to the holders of any class of stock; (b) any
redemption, conversion, exchange, retirement or similar payment,
purchase or other acquisition for value, direct or indirect, of any
shares of any class of stock of Borrower or any of its Subsidiaries
(other than those payable or distributable solely to the Borrower or
solely in shares of common stock) now or hereafter outstanding; and (c)
any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any
class of stock of Borrower or any of its Subsidiaries now or hereafter
outstanding.
"Revolving Credit Commitment" means, with respect to each
Lender, the obligation of such Lender to make Revolving Loans to the
Borrower up to an aggregate principal amount at any one time
outstanding equal to such Lender's Applicable Commitment Percentage of
the Total Revolving Credit Commitment.
21
"Revolving Credit Facility" means the facility described in
Article II hereof providing for Revolving Loans to the Borrower by the
Lenders in the aggregate principal amount of the Total Revolving Credit
Commitment.
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Revolving Loans
then outstanding.
"Revolving Credit Termination Date" means the earliest to
occur of (i) the Stated Termination Date or (ii) the date of
termination of Lenders' obligations pursuant to Section 9.1 hereof upon
the occurrence of an Event of Default, or (iii) the Facility
Termination Date.
"Revolving Loan" means any borrowing pursuant to an Advance
under the Revolving Credit Facility in accordance with Article II
hereof.
"Revolving Notes" means, collectively, the promissory notes of
the Borrower evidencing Revolving Loans executed and delivered to the
Lenders as provided in Section 2.5 hereof substantially in the form of
Exhibit F-1, with appropriate insertions as to amounts, dates and names
of Lenders.
"S&P" means Standard & Poor's Ratings Group, a division of the
XxXxxx-Xxxx Company, Inc.
"Significant Subsidiary" means each Material Subsidiary and
any non-Material Subsidiary of the Borrower which (i) has total assets
equal to or greater than 5% of Consolidated Total Assets (calculated as
of the most recent date for which the Agent has received the Required
Financial Information) or (ii) has income equal to or greater than 5%
of Consolidated Net Income (calculated for the most recent period for
which the Agent has received the Required Financial Information).
"Single Employer Plan" means any employee pension benefit plan
covered by Title IV of ERISA in respect of which the Borrower or any
Subsidiary is an "employer" as described in Section 4001(b) of ERISA
and which is not a Multiemployer Plan.
"Solvent" means, when used with respect to any Person, that at
the time of determination:
(i) the fair value of its assets (both at fair
valuation and at present fair saleable value on an orderly
basis) is in excess of the total amount of its liabilities,
including Contingent Obligations (calculated for the purposes
hereof at the amount which, in light of all facts and
circumstances at the time, could reasonably be expected to
become an actual or mature liability); and
22
(ii) it is then able and expects to be able to pay
its debts as they mature; and
(iii) it has capital sufficient to carry on its
business as conducted and as proposed to be conducted.
"Stated Termination Date" means September 30, 2000.
"Subsidiary" means any corporation or other entity in which
more than 50% of its outstanding voting stock or more than 50% of all
equity interests is owned directly or indirectly by the Borrower and/or
by one or more of the Borrower's Subsidiaries.
"Subsidiary Guaranty" means each Guaranty Agreement between
one or more Material Subsidiaries and the Agent for the benefit of the
Lenders, delivered as of the Closing Date and otherwise pursuant to
Section 7.19 hereof, as the same may be amended, supplemented or
replaced from time to time.
"Swap Agreement" means one or more agreements between the
Borrower and any Person with respect to Indebtedness evidenced by any
or all of the Notes, on terms mutually acceptable to Borrower and such
Person and approved by the Lenders, which agreements create Hedging
Obligations; provided, however, that no such approval of the Lenders
shall be required to the extent such agreements are entered into
between the Borrower and any Lender.
"Swing Line" means the revolving line of credit established by
NationsBank pursuant to Section 2.13.
"Swing Line Loans" means loans made by NationsBank pursuant to
Section 2.13.
"Swing Line Note" means the promissory note of the Borrower
evidencing Swing Line Loans executed and delivered to NationsBank
substantially in the form attached hereto as Exhibit F-2.
"Swing Line Outstandings" means, as of any date of
determination, the aggregate principal amount of all Swing Line Loans
then outstanding.
"Termination Event" means: (i) a "Reportable Event" described
in Section 4043 of ERISA and the regulations issued thereunder (unless
the notice requirement has been waived by applicable regulation); or
(ii) the withdrawal of the Borrower or any ERISA Affiliate from a
Pension Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA or was deemed such
under Section 4068(f) of ERISA; or (iii) the termination of a Pension
Plan, the filing of a notice of intent to terminate a Pension Plan or
the treatment of a Pension Plan amendment as a termination under
Section 4041 of ERISA; or (iv) the institution of proceedings to
terminate a Pension
23
Plan by the PBGC; or (v) any other event or condition which would
constitute grounds under Section 4042(a) of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan; or
(vi) the partial or complete withdrawal of the Borrower or any ERISA
Affiliate from a Multiemployer Plan; or (vii) the imposition of a Lien
pursuant to Section 412 of the Code or Section 302 of ERISA; or (viii)
any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Section 4241 or Section 4245
of ERISA, respectively; or (ix) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or
the institution by the PBGC of proceedings to terminate a Multiemployer
Plan under Section 4042 of ERISA.
"Total Letter of Credit Commitment" means an amount not to
exceed $15,000,000.
"Total Revolving Credit Commitment" means a principal amount
equal to $110,000,000, as reduced from time to time in accordance with
Section 2.7 hereof.
"Type" shall mean any type of Loan (i.e., a Base Rate Loan or
a Eurodollar Rate Loan).
"Voting Stock" means shares of capital stock issued by a
corporation, or equivalent interests in any other Person, the holders
of which are ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing similar
functions) of such Person, even if the right so to vote has been
suspended by the happening of such a contingency.
1.2. Rules of Interpretation.
(a) All accounting terms not specifically defined herein shall
have the meanings assigned to such terms and shall be interpreted in
accordance with GAAP applied on a Consistent Basis.
(b) Each term defined in Article 1, 5, 8 or 9 of the New York
Uniform Commercial Code shall have the meaning given therein unless
otherwise defined herein, except to the extent that the Uniform
Commercial Code of another jurisdiction is controlling, in which case
such terms shall have the meaning given in the Uniform Commercial Code
of the applicable jurisdiction.
(c) The headings, subheadings and table of contents used
herein or in any other Loan Document are solely for convenience of
reference and shall not constitute a part of any such document or
affect the meaning, construction or effect of any provision thereof.
(d) Except as otherwise expressly provided, references
herein to articles, sections, paragraphs, clauses, annexes, appendices,
exhibits and schedules are references
24
to articles, sections, paragraphs, clauses, annexes, appendices,
exhibits and schedules in or to this Agreement.
(e) All definitions set forth herein or in any other Loan
Document shall apply to the singular as well as the plural form of such
defined term, and all references to the masculine gender shall include
reference to the feminine or neuter gender, and vice versa, as the
context may require.
(f) When used herein or in any other Loan Document, words such
as "hereunder", "hereto", "hereof" and "herein" and other words of like
import shall, unless the context clearly indicates to the contrary,
refer to the whole of the applicable document and not to any particular
article, section, subsection, paragraph or clause thereof.
(g) References to "including" means including without limiting
the generality of any description preceding such term.
(h) All dates and times of day specified herein shall refer to
such dates and times at Dallas, Texas.
(i) Each of the parties to the Loan Documents and their
counsel have reviewed and revised, or requested (or had the opportunity
to request) revisions to, the Loan Documents, and any rule of
construction that ambiguities are to be resolved against the drafting
party shall be inapplicable in the construing and interpretation of the
Loan Documents and all exhibits, schedules and appendices thereto.
(j) Any reference to an officer of the Borrower or any other
Person by reference to the title of such officer shall be deemed to
refer to each other officer of such Person, however titled, exercising
the same or substantially similar functions.
(k) All references to any agreement or document as amended,
modified or supplemented, or words of similar effect, shall mean such
document or agreement, as the case may be, as amended, modified or
supplemented from time to time only as and to the extent permitted
therein and in the Loan Documents.
25
ARTICLE II
The Revolving Credit Facility
-----------------------------
2.1. Revolving Loans.
----------------
(a) Commitment. Subject to the terms and conditions of this
Agreement, each Lender severally agrees to make Advances to the Borrower under
the Revolving Credit Facility from time to time from the Closing Date until the
Revolving Credit Termination Date on a pro rata basis as to the total borrowing
requested by the Borrower on any day determined by such Lender's Applicable
Commitment Percentage up to but not exceeding the Revolving Credit Commitment of
such Lender, provided, however, that the Lenders will not be required and shall
have no obligation to make any such Advance (i) so long as a Default or an Event
of Default has occurred and is continuing or (ii) if the Agent has accelerated
the maturity of any of the Notes as a result of an Event of Default; provided
further, however, that immediately after giving effect to each such Advance, the
aggregate amount of Outstandings shall not exceed the Total Revolving Credit
Commitment. Within such limits, the Borrower may borrow, repay and reborrow
under the Revolving Credit Facility on a Business Day from the Closing Date
until, but (as to borrowings and reborrowings) not including, the Revolving
Credit Termination Date; provided, however, that (y) no Revolving Loan that is a
Eurodollar Rate Loan shall be made which has an Interest Period that extends
beyond the Stated Termination Date and (z) each Revolving Loan that is a
Eurodollar Rate Loan may, subject to the provisions of Section 2.7 hereof, be
repaid only on the last day of the Interest Period with respect thereto unless
such payment is accompanied by the additional payment, if any, required by
Section 4.5.
(b) Amounts. Except as otherwise permitted by the Lenders from
time to time, the aggregate amount of Outstandings shall not exceed at any time
the Total Revolving Credit Commitment, and, in the event there shall be
outstanding any such excess, the Borrower shall immediately make such payments
and prepayments as shall be necessary to comply with this restriction. Each
Revolving Loan hereunder, other than Base Rate Refunding Loans and Swing Line
Loans, and each Conversion under Section 2.8 hereof, shall be in an amount of at
least $1,000,000, and, if greater than $1,000,000, an integral multiple of
$100,000.
(c) Advances. (i) An Authorized Representative shall give the
Agent (1) at least three (3) Business Days' irrevocable written notice by
telefacsimile transmission of a Borrowing Notice or Interest Rate Selection
Notice (as applicable) with appropriate insertions, effective upon receipt, of
each Revolving Loan that is a Eurodollar Rate Loan (whether representing an
additional borrowing hereunder or the Conversion of a borrowing hereunder from
Base Rate Loans to Eurodollar Rate Loans) on or prior to 10:30 A.M. and (2)
irrevocable written notice by telefacsimile transmission of a Borrowing Notice
or Interest Rate Selection Notice (as applicable) with appropriate insertions,
effective upon receipt, of each Revolving Loan (other than Base Rate Refunding
Loans to the extent the same are effected without notice pursuant to Section
2.1(c)(iv) hereof) that is a Base Rate Loan (whether representing an additional
borrowing hereunder or the Conversion of borrowing hereunder from Eurodollar
Rate Loans to Base Rate
26
Loans) on or prior to 10:30 A.M. on the day of such proposed Revolving Loan.
Each such notice shall specify the amount of the borrowing, the Type of
Revolving Loan (Base Rate or Eurodollar Rate), the date of borrowing and, if a
Eurodollar Rate Loan, the Interest Period to be used in the computation of
interest. Notice of receipt of such Borrowing Notice or Interest Rate Selection
Notice, as the case may be, together with the amount of each Lender's portion of
an Advance requested thereunder, shall be provided by the Agent to each Lender
by telefacsimile transmission with reasonable promptness, but (provided the
Agent shall have received such notice by 10:30 A.M.) not later than 12:00 P.M.
on the same day as the Agent's receipt of such notice.
(ii) Not later than 2:00 P.M. on the date specified for each borrowing
under this Section 2.1, each Lender shall, pursuant to the terms and subject to
the conditions of this Agreement, make the amount of the Advance or Advances to
be made by it on such day available by wire transfer to the Agent in the amount
of its pro rata share, determined according to such Lender's Applicable
Commitment Percentage of the Revolving Loan or Revolving Loans to be made on
such day. Such wire transfer shall be directed to the Agent at the Principal
Office and shall be in the form of Dollars constituting immediately available
funds. The amount so received by the Agent shall, subject to the terms and
conditions of this Agreement, be made immediately available to the Borrower by
delivery of the proceeds thereof to the Borrower's Account or otherwise as shall
be directed in the applicable Borrowing Notice by the Authorized Representative
and reasonably acceptable to the Agent.
(iii) The Borrower shall have the option to elect the duration of the
initial and any subsequent Interest Periods and to Convert the Revolving Loans
in accordance with Section 2.8. Eurodollar Rate Loans and Base Rate Loans may be
outstanding at the same time, provided, however, there shall not be outstanding
at any one time Eurodollar Rate Loans having more than six (6) different
Interest Periods. If the Agent does not receive a Borrowing Notice or an
Interest Rate Selection Notice giving notice of election of the duration of an
Interest Period or of Conversion of any Loan to or Continuation of a Loan as a
Eurodollar Rate Loan by the time prescribed by Section 2.1(c)(i) or 2.8 hereof,
the Borrower shall be deemed to have elected to request such Advance to be, or
Convert such Loan to, or Continue such Loan as, a Base Rate Loan until the
Borrower notifies the Agent in accordance with Section 2.8 hereof.
(iv) Notwithstanding the foregoing, if a drawing is made under any
Letter of Credit, such drawing is honored by the Issuing Bank prior to the
Revolving Credit Termination Date, and the Borrower shall not immediately fully
reimburse the Issuing Bank in respect of such drawing, (A) provided that the
conditions to making a Revolving Loan as herein provided shall then be
satisfied, the Reimbursement Obligation arising from such drawing shall be paid
to the Issuing Bank by the Agent without the requirement of notice to or from
the Borrower from immediately available funds which shall be advanced as a Base
Rate Refunding Loan by each Lender under the Revolving Credit Facility in an
amount equal to such Lender's Applicable Commitment Percentage of such
Reimbursement Obligation, and (B) if the conditions to making a Revolving Loan
as herein provided shall not then be satisfied, each of the Lenders shall fund
by payment to the Agent (for the benefit of the Issuing Bank) in immediately
available funds the purchase from the Issuing Bank of their respective
Participations in the related Reimbursement Obligation based
27
on their respective Applicable Commitment Percentages of the Total Letter of
Credit Commitment. If a drawing is presented under any Letter of Credit in
accordance with the terms thereof and the Borrower shall not immediately
reimburse the Issuing Bank in respect thereof, then notice of such drawing or
payment shall be provided promptly by the Issuing Bank to the Agent and the
Agent shall provide notice to each Lender by telephone or telefacsimile
transmission. If notice to the Lenders of a drawing under any Letter of Credit
is given by the Agent at or before 12:00 noon on any Business Day, each Lender
shall, pursuant to the conditions specified in this Section 2.1(c)(iv), either
make a Base Rate Refunding Loan or fund the purchase of its Participation, as
applicable, in the amount of such Lender's Applicable Commitment Percentage of
such drawing or payment and shall pay such amount to the Agent for the account
of the Issuing Bank at the Principal Office in Dollars and in immediately
available funds before 2:00 P.M. on the same Business Day. If notice to the
Lenders of a drawing under a Letter of Credit is given by the Agent after 12:00
noon on any Business Day, each Lender shall, pursuant to the conditions
specified in this Section 2.1(c)(iv), either make a Base Rate Refunding Loan or
fund the purchase of its Participation in the amount of such Lender's Applicable
Commitment Percentage of such drawing or payment and shall pay such amount to
the Agent for the account of the Issuing Bank at the Principal Office in Dollars
and in immediately available funds before 12:00 noon on the next following
Business Day. Any such Base Rate Refunding Loan shall be advanced as, and shall
Continue as, a Base Rate Loan unless and until the Borrower Converts such Base
Rate Loan in accordance with the terms of Section 2.8 hereof.
2.2. Payment of Interest.
--------------------
(a) The Borrower shall pay interest to the Agent for the
account of each Lender on the outstanding and unpaid principal amount of each
Revolving Loan made by such Lender for the period commencing on the date of such
Revolving Loan until such Revolving Loan shall be due at the then applicable
Base Rate for Base Rate Loans or applicable Eurodollar Rate for Eurodollar Rate
Loans, as designated by the Authorized Representative pursuant to Section 2.1
hereof; provided, however, that if any amount shall not be paid when due (at
maturity, by acceleration or otherwise) or if any other Event of Default shall
have occurred and be continuing hereunder, all amounts outstanding hereunder
shall bear interest thereafter at the Default Rate from the date such Event of
Default occurred until the date such Event of Default is cured or waived.
(b) Interest on each Revolving Loan shall be computed on the
basis of a year of 360 days and calculated in each case for the actual number of
days elapsed. Interest on each Revolving Loan shall be paid (i) quarterly in
arrears on the last Business Day of each March, June, September and December,
commencing September 30, 1997 for each Base Rate Loan, (ii) on the last day of
the applicable Interest Period for each Eurodollar Rate Loan and, if such
Interest Period extends for more than three (3) months, at intervals of three
(3) months after the first day of such Interest Period, and (iii) upon payment
in full of the principal amount of such Revolving Loan.
2.3. Payment of Principal.
--------------------
The principal amount of each Revolving Loan shall be due and payable to the
Agent for the benefit of each Lender in full on the Revolving Credit Termination
Date, or earlier as specifically provided herein. The principal amount of any
Base Rate Loan may be prepaid in whole or in part at any time. The principal
28
Rate Loan may be prepaid in whole or in part at any time. The principal amount
of any Eurodollar Rate Loan may be prepaid only at the end of the applicable
Interest Period unless the Borrower shall pay to the Agent for the account of
the Lenders the additional amount, if any, required under Section 4.5 hereof.
All prepayments of Revolving Loans made by the Borrower shall be in the amount
of $1,000,000 or such greater amount which is an integral multiple of $100,000,
or the amount equal to all Revolving Credit Outstandings, or such other amount
as necessary to comply with Section 2.1(c)(iv) or Section 2.8 hereof.
2.4. Manner of Payments.
------------------
(a) Each payment of principal (including any prepayment) and
payment of interest and fees, and any other amount required to be paid to the
Lenders with respect to the Revolving Loans, shall be made to the Agent at the
Principal Office, for the account of each Lender, in Dollars and in immediately
available funds before 1:00 P.M. on the date such payment is due. The Agent may,
but shall not be obligated to, debit the amount of any such payment which is not
made by such time to any ordinary deposit account, if any, of the Borrower with
the Agent.
(b) The Agent shall deem any payment made by or on behalf of
the Borrower hereunder that is not made both in Dollars and in immediately
available funds and prior to 1:00 P.M. to be a non-conforming payment. Any such
payment shall not be deemed to be received by the Agent until the later of (i)
the time such funds become available funds and (ii) the next Business Day. Any
non-conforming payment may constitute or become a Default or Event of Default.
Interest shall continue to accrue on any principal as to which a non-conforming
payment is made until the later of (x) the date such funds become available
funds or (y) the next Business Day at the Default Rate from the date such amount
was due and payable.
(c) In the event that any payment hereunder or under the
Revolving Notes becomes due and payable on a day other than a Business Day, then
such due date shall be extended to the next succeeding Business Day unless
provided otherwise under clause (ii) of the definition of "Interest Period";
provided that interest shall continue to accrue during the period of any such
extension and provided further, that in no event shall any such due date be
extended beyond the Revolving Credit Termination Date.
2.5. Notes.
------
(a) Revolving Loans made by each Lender shall be evidenced by
a Revolving Note payable to the order of such Lender in the respective amount of
its Revolving Credit Commitment, which Revolving Note shall be dated the Closing
Date or a later date pursuant to an Assignment and Acceptance and shall be duly
completed, executed and delivered by the Borrower.
(b) Swing Line Loans made by NationsBank shall be evidenced by
the Swing Line Note payable to the order of NationsBank, which Note shall be
dated the Closing Date and shall be duly completed, executed and delivered by
the Borrower.
29
2.6. Pro Rata Payments.
------------------
Except as otherwise provided herein, (a) each payment on account of the
principal of and interest on the Revolving Loans and the fees described in
Section 2.10 hereof shall be made to the Agent for the account of the Lenders
pro rata based on their Applicable Commitment Percentages, (b) all payments to
be made by the Borrower for the account of each of the Lenders on account of
principal, interest and fees, shall be made without diminution, setoff,
recoupment or counterclaim, and (c) the Agent will promptly distribute to the
Lenders in immediately available funds payments received infully collected,
immediately available funds from the Borrower.
2.7. Reductions.
-----------
The Borrower shall, by notice from an Authorized Representative, have the right
from time to time but not more frequently than once each calendar month, upon
not less than three (3) Business Days' written notice to the Agent, effective
upon receipt, to reduce the Total Revolving Credit Commitment. The Agent shall
give each Lender, within one (1) Business Day of receipt of such notice,
telefacsimile notice, or telephonic notice (confirmed in writing), of such
reduction. Each such reduction shall be in the aggregate amount of $1,000,000 or
such greater amount which is in an integral multiple of $1,000,000, or the
entire remaining Total Revolving Credit Commitment, and shall permanently reduce
the Total Revolving Credit Commitment and the Revolving Credit Commitment of
each Lender pro rata. Each reduction of the Total Revolving Credit Commitment
shall be accompanied by payment of the Revolving Loans to the extent that the
aggregate principal amount of Outstandings exceeds the Total Revolving Credit
Commitment after giving effect to such reduction, together with accrued and
unpaid interest on the amounts prepaid. No such reduction shall result in the
payment of any Eurodollar Rate Loan other than on the last day of the Interest
Period of such Eurodollar Rate Loan unless such prepayment is accompanied by
amounts due, if any, under Section 4.5 hereof.
2.8. Conversions and Elections of Subsequent Interest Periods.
--------------------------------------------------------
(a) Upon delivery, effective upon receipt, of a properly
completed Interest Rate Selection Notice to the Agent on or before 10:30 A.M. on
any Business Day, the Borrower may Convert all or a part of Eurodollar Rate
Loans under the Revolving Credit Facility to Base Rate Loans on the last day of
the Interest Period for such Eurodollar Rate Loans; and
(b) Provided that no Default or Event of Default shall have
occurred and be continuing and subject to the limitations set forth below and in
Article IV hereof, the Borrower may, upon delivery, effective upon receipt, of a
properly completed Interest Rate Selection Notice to the Agent on or before
10:30 A.M. three (3) Business Days' prior to the date of such election or
Conversion:
(i) elect a subsequent Interest Period for all or a
portion of Eurodollar Rate Loans under the Revolving Credit
Facility to begin on the last day of the then current Interest
Period for such Eurodollar Rate Loans; and
(ii) Convert Base Rate Loans under the Revolving
Credit Facility to Eurodollar Rate Loans on any Business Day.
30
Each election and Conversion pursuant to this Section 2.8 shall be subject to
the limitations on Eurodollar Rate Loans set forth in the definition of
"Interest Period" herein and in Sections 2.1, 2.3 and Article IV hereof. The
Agent shall give written notice to each Lender of such notice of election or
Conversion prior to 12:00 P.M. on the day such notice of election or Conversion
is received. All such Continuations or Conversions of Loans shall be effected
pro rata based on the Applicable Commitment Percentages of the Lenders.
2.9. Increase and Decrease in Amounts.
---------------------------------
The amount of the Total Revolving Credit Commitment which shall be available to
the Borrower as Advances shall be reduced by the aggregate amount of
Outstandings.
2.10. Commitment Fee.
---------------
For the period beginning on the Closing Date and ending on the Revolving Credit
Termination Date, the Borrower agrees to pay to the Agent, for the pro rata
benefit of the Lenders based on their Applicable Commitment Percentages, a fee
equal to the Applicable Margin for the Commitment Fee multiplied by the average
daily amount by which the Total Revolving Credit Commitment exceeds the
Outstandings (without giving effect to Swing Line Outstandings except in the
case of NationsBank). Such fees shall be due in arrears on the last Business Day
of each March, June, September and December, commencing September 30, 1997 to
and on the Revolving Credit Termination Date. Notwithstanding the foregoing, so
long as any Lender fails to make available any portion of its Revolving Credit
Commitment when requested, such Lender shall not be entitled to receive payment
of its pro rata share of such fee until such Lender shall make available such
portion. Such fee shall be calculated on the basis of a year of 360 days for the
actual number of days elapsed.
2.11. Deficiency Advances.
---------------------
No Lender shall be responsible for any default of any other Lender in respect to
such other Lender's obligation to make any Loan or fund its purchase of any
Participation hereunder nor shall the Revolving Credit Commitment of any Lender
hereunder be increased as a result of such default of any other Lender. Without
limiting the generality of the foregoing, in the event any Lender shall fail to
advance funds to the Borrower under the Revolving Credit Facility as herein
provided, the Agent may in its discretion, but shall not be obligated to,
advance under the Revolving Note in its favor as a Lender all or any portion of
such amount or amounts (each, a "deficiency advance") and shall thereafter be
entitled to payments of principal of and interest on such deficiency advance in
the same manner and at the same interest rate or rates to which such other
Lender would have been entitled had it made such advance under its Revolving
Note; provided that, upon payment to the Agent from such other Lender of the
entire outstanding amount of each such deficiency advance, together with accrued
and unpaid interest thereon,from the most recent date or dates interest was paid
to the Agent by the Borrower on each Revolving Loan comprising the deficiency
advance at the interest rate per annum for overnight borrowing by the Agent from
the Federal Reserve Bank, then such payment shall be credited against the
applicable Revolving Note of the Agent in full payment of such deficiency
31
advance and the Borrower shall be deemed to have borrowed the amount of such
deficiency advance from such other Lender as of the most recent date or dates,
as the case may be, upon which any payments of interest were made by the
Borrower thereon.
2.12. Use of Proceeds.
----------------
The proceeds of the Loans made pursuant to the Revolving Credit Facility
hereunder shall be used by the Borrower for working capital, capital
expenditures, permitted Acquisitions and general corporate purposes.
2.13. Swing Line.
-----------
a) Notwithstanding any other provision of this Agreement to the
contrary, in order to administer the Revolving Credit Facility in an efficient
manner and to minimize the transfer of funds between the Agent and the Lenders,
NationsBank shall make available Swing Line Loans to the Borrower prior to the
Facility Termination Date. NationsBank shall not make any Swing Line Loan
pursuant hereto (i) if NationsBank has received written notice from the Borrower
or a Lender that the Borrower is not in compliance with all the conditions to
the making of Loans set forth in this Agreement, (ii) if after giving effect to
such Swing Line Loan, the Swing Line Outstandings exceed $5,000,000 or (iii) if
after giving effect to such Swing Line Loan, the aggregate amount of all
Outstandings exceeds the Total Revolving Credit Commitment. Swing Line Loans
shall bear interest at the Base Rate. The Borrower may borrow, repay and
reborrow under this Section 2.13. Unless notified to the contrary by
NationsBank, borrowings under the Swing Line shall be made in the minimum amount
of $100,000 or, if greater, in amounts which are integral multiples of $50,000,
upon written request by telefacsimile transmission, effective upon receipt, by
an Authorized Representative made to NationsBank not later than 2:00 P.M. on the
Business Day of the requested borrowing. Each such Borrowing Notice shall
specify the amount of the borrowing and the date of borrowing, and shall be in
the form of Exhibit D-2, with appropriate insertions. Unless notified to the
contrary by NationsBank, each repayment of a Swing Line Loan shall be in the
minimum amount of $500,000 or an integral multiple of $50,000 in excess thereof,
or the aggregate amount of all Swing Line Outstandings. If an Authorized
Representative instructs NationsBank to debit any demand deposit account of a
Borrower in the amount of any payment with respect to a Swing Line Loan, or
NationsBank otherwise receives repayment, after 2:00 P.M. on a Business Day,
such payment shall be deemed received on the next Business Day. Each Swing Line
Loan shall be repaid by the Borrower on or before the tenth Business Day
following the day such Swing Line Loan is made.
(b) The interest payable on Swing Line Loans is solely for the
account of NationsBank, and all accrued and unpaid interest on Swing Line Loans
shall be payable on the dates and in the manner provided in Sections 2.2 and 2.4
with respect to interest on Base Rate Loans except as otherwise set forth in
Section 2.13(a) above. The Swing Line Outstandings shall be evidenced by th Note
delivered to NationsBank pursuant to Section 2.5.
(c) Upon the making of a Swing Line Loan, each Lender shall be
deemed to have purchased from NationsBank a Participation therein in an amount
equal to that Lender's Applicable Commitment Percentage of such Swing Line Loan.
Upon demand made by NationsBank, each Lender shall, according to its Applicable
Commitment Percentage of such Swing Line Loan, promptly provide to NationsBank
its purchase price therefor in an amount equal
32
to its Participation therein. Any Advance made by a Lender pursuant to demand of
NationsBank of the purchase price of its Participation shall be deemed to be (i)
provided that the conditions to making Loans shall be satisfied, a Base Rate
Refunding Loan pursuant to Section 2.1 until the Borrower Converts such Base
Rate Loan in accordance with the terms of Section 2.8, and (ii) in all other
cases, the funding by each Lender of the purchase price of its Participation in
such Swing Line Loan. The obligation of each Lender to so provide its purchase
price to NationsBank pursuant to clause (ii) above shall be absolute and
unconditional and shall not be affected by the occurrence or continuance of a
Default or an Event of Default, the failure to satisfy any condition to the
making of a Loan or any other occurrence or event.
(d) The Borrower at its option and subject to the terms
hereof, may request an Advance pursuant to Section 2.1 in an amount sufficient
to repay Swing Line Outstandings on any date and the Agent shall provide to
NationsBank from the proceeds of such Advance the amount necessary to repay such
Swing Line Outstandings (which NationsBank shall then apply to such repayment)
and credit any balance of the Advance in immediately available funds in the
manner directed by the Borrower pursuant to Section 2.1(c)(ii) and the Lenders
shall then be deemed to have made Loans in the amount of such Advances. The
Swing Line shall continue in effect until the Revolving Credit Termination Date.
ARTICLE III
-----------
Letters of Credit
-----------------
3.1. Letters of Credit.
-----------------
(a) The Issuing Bank agrees, subject to the terms and
conditions of this Agreement, upon request of the Borrower to issue from time to
time for the account of the Borrower Letters of Credit upon delivery to the
Issuing Bank of an Application and Agreement for Letter of Credit relating
thereto in form and content acceptable to the Issuing Bank; provided, that (i)
the Letter of Credit Outstandings shall not exceed the Total Letter of Credit
Commitment, (ii) no Letter of Credit shall be issued if, after giving effect
thereto, the aggregate amount of Outstandings shall exceed the Total Revolving
Credit Commitment and (iii) no Letter of Credit shall be issued if the Issuing
Bank has received written notice from the Borrower or a Lender that the Borrower
is not in compliance with all of the conditions to issuance of a Letter of
Credit set forth in this Agreement.
(b) No Letter of Creditshall have an initial expiry date
occurring later than the earlier to occur of twelve (12) month after the date of
its issuance or the fifth Business Day prior to the Stated Termination Date;
provided, however, that each Letter of Credit may by its terms automatically
extend its then existing expiry date for an additional twelve (12) month period
(an "Extension Period") provided (i) the Agent has not given notice to the
Borrower and the beneficiary of such Letter of Credit of its election not to
renew such Letter of Credit, such notice to be given at least sixty (60) days
prior to the then existing expiry date of such Letter of Credit and (ii) such
Letter of Credit shall have been cash-collateralized in a manner consistent with
the terms of Section 9.1(B) hereof. Each Letter of Credit may have any number of
consecutive Extension Periods provided no notice, as described above has been
33
delivered by the Agent; provided, however, no Letter of Credit shall have an
Extension Period ending after the date which is twelve (12) months following the
fifth Business Day prior to the Stated Termination Date. After the Stated
Termination Date, no Lender shall be deemed to have a Participation in a Letter
of Credit having an Extension Period which continues beyond the Stated
Termination Date to the extent such Lender has delivered to the Agent and each
other Lender written notice of its election not to renew its Participation in
such Letter of Credit, such notice to be given at least seventy-five (75) days
prior to the existing expiry date of such Letter of Credit. Notwithstanding the
foregoing provisions of this Section 3.1(b), no Letter of Credit providing for
confirmation by a confirming bank or a nominated Person shall have an expiry
date later than 45 days preceding the Stated Termination Date (or, if subject to
an Extension Period continuing past the Stated Termination Date, 45 days
preceding the date which is twelve(12) months following the Stated Termination
Date).
3.2. Reimbursement.
-------------
(a) The Borrower hereby unconditionally agrees to pay to the
Issuing Bank immediately on demand at the Principal Office all amounts required
to pay all drafts drawn or purporting to be drawn under the Letters of Credit
and all reasonable expenses incurred by the Issuing Bank in connection with the
Letters of Credit, and in any event and without demand to place in possession of
the Issuing Bank (which shall include Advances under the Revolving Credit
Facility if permitted by Section 2.1 hereof) sufficient funds to pay all debts
and liabilities arising under any Letter of Credit. The Issuing Bank agrees to
give the Borrower prompt notice of any request for a draw under a Letter of
Credit. The Issuing Bank may charge any account the Borrower may have with it
for any and all amounts the Issuing Bank pays under a Letter of Credit, plus
charges and reasonable expenses as from time to time agreed to by the Issuing
Bank and the Borrower; provided that to the extent permitted by Section
2.1(c)(iv) hereof, amounts shall be paid pursuant to Advances under the
Revolving Credit Facility. The Borrower agrees to pay the Issuing Bank interest
on any Reimbursement Obligations not paid when due hereunder at the Default
Rate, such rate to be calculated on the basis of a year of 360 days for actual
days elapsed.
(b) In accordance with the provisions of Section 2.1(c)(iv)
hereof, the Issuing Bank shall notify the Agent of any drawing under any Letter
of Credit promptly following the receipt by the Issuing Bank of such drawing.
(c) Each Lender (other than the Issuing Bank) shall
automatically acquire on the date of issuance thereof, a Participation in the
liability of the Issuing Bank in respect of each Letter of Credit in an amount
equal to such Lender's Applicable Commitment Percentage of such liability, and
to the extent that the Borrower is obligated to pay the Issuing Bank under
Section 3.2(a) hereof, each Lender (other than the Issuing Bank) thereby shall
absolutely, unconditionally and irrevocably assume, and shall be unconditionally
obligated to pay to the Issuing Bank as hereinafter described, its Applicable
Commitment Percentage of the liability of the Issuing Bank under such Letter of
Credit.
34
(i) Each Lender (other than the Issuing Bank) shall,
subject to the terms and conditions of Article II, pay to the
Agent for the account of the Issuing Bank at the Principal
Office in Dollars and in immediately available funds, an
amount equal to its Applicable Commitment Percentage of any
Reimbursement Obligation under a Letter of Credit, such funds
to be provided in the manner described in Section 2.1(c)(iv)
hereof.
(ii) Simultaneously with the making of each payment
by a Lender to the Issuing Bank pursuant to Section
2.1(c)(iv)(B) hereof, such Lender shall, automatically and
without any further action on the part of the Issuing Bank or
such Lender, acquire a Participation in an amount equal to
such payment (excluding the portion thereof constituting
interest accrued prior to the date the Lender made its
payment) in the related Reimbursement Obligation of the
Borrower. The Reimbursement Obligations of the Borrower shall
be immediately due and payable whether by Advances made in
accordance with Section 2.1(c)(iv)(A) hereof or otherwise.
(iii) Each Lender's obligation to make payment to the
Agent for the account of the Issuing Bank pursuant to Section
2.1(c)(iv) hereof and this Section 4.2(c), and the right of
the Issuing Bank to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance
whatsoever and shall be made without any offset, abatement,
withholding or reduction whatsoever. If any Lender is
obligated to pay but does not pay amounts to the Agent for the
account of the Issuing Bank in full upon such request as
required by Section 2.1(c)(iv) hereof or this Section 3.2(c),
such Lender shall, on demand, pay to the Agent for the account
of the Issuing Bank interest on the unpaid amount for each day
during the period commencing on the date of notice given to
such Lender pursuant to Section 2.1(c) hereof until such
Lender pays such amount to the Agent for the account of the
Issuing Bank in full at the interest rate per annum for
overnight borrowing by the Agent from the Federal Reserve
Bank.
(iv) In the event the Lenders have purchased
Participations in any Reimbursement Obligation as set forth in
clause (ii) above, then at any time payment of such
Reimbursement Obligation (including any payment of interest
pursuant to Section 3.2(a) hereof), in whole or in part, is
received by Issuing Bank in fully collected, immediately
available funds from the Borrower, Issuing Bank shall promptly
pay to each Lender an amount equal to its Applicable
Commitment Percentage of such payment.
(d) Promptly following the end of each calendar quarter, the
Issuing Bank shall deliver to the Agent a notice describing the aggregate
undrawn amount of all Letters of Credit at the end of such quarter. Upon the
request of any Lender from time to time, the Issuing Bank shall deliver to the
Agent, and the Agent shall deliver to such Lender, any other information
reasonably requested by such Lender with respect to each Letter of Credit
outstanding.
35
(e) The issuance by the Issuing Bank of each Letter of Credit
shall, in addition to the conditions precedent set forth in Article V hereof, be
subject to the conditions that such Letter of Credit be in such form and contain
such terms as shall be reasonably satisfactory to the Issuing Bank consistent
with the then current practices and procedures of the Issuing Bank with respect
to similar letters of credit, and the Borrower shall have executed and delivered
such other instruments and agreements relating to such Letters of Credit as the
Issuing Bank shall have reasonably requested consistent with such practices and
procedures. All Letters of Credit shall be issued pursuant to and subject to the
Uniform Customs and Practice for Documentary Credits, 1993 revision,
International Chamber of Commerce Publication No. 500 and all subsequent
amendments and revisions thereto.
(f) The Borrower agrees that Issuing Bank may, in its sole
discretion, accept or pay, as complying with the terms of any Letter of Credit,
any drafts or other documents otherwise in order which may be signed or issued
by an administrator, executor, trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, liquidator, receiver, attorney in fact or
other legal representative of a party who is authorized under such Letter of
Credit to draw or issue any drafts or other documents.
(g) Subject to and without limiting the generality of the
provisions of Section 11.9 hereof, the Borrower hereby agrees to indemnify and
hold harmless the Issuing Bank, each other Lender and the Agent from and against
any and all claims and damages, losses, liabilities, reasonable and documented
out-of-pocket costs and expenses which the Issuing Bank, such other Lender or
the Agent incurs by reason of or in connection with the issuance or transfer of
or payment or failure to pay under any Letter of Credit; provided that the
Borrower shall not be required to indemnify the Issuing Bank, any other Lender
or the Agent for any claims, damages, losses, liabilities, costs or expenses to
the extent, but only to the extent, (i) caused by the willful misconduct or
gross negligence of the party to be indemnified or (ii) caused by the failure of
the Issuing Bank to pay under any Letter of Credit after the presentation to it
of a request for payment strictly complying with the terms and conditions of
such Letter of Credit, unless such payment is prohibited by any law, regulation,
court order or decree.
(h) Without limiting Borrower's rights as set forth in Section
3.2(g) hereof, the obligation of the Borrower to immediately reimburse the
Issuing Bank for drawings made under Letters of Credit and the Issuing Bank's
right to receive such payment shall be absolute, unconditional and irrevocable,
and that such obligations of the Borrower shall be performed strictly in
accordance with the terms of this Agreement and such Letters of Credit and the
related Applications and Agreement for any Letter of Credit, under all
circumstances whatsoever, including the following circumstances:
(i) any lack of validity or enforceability of the
Letter of Credit, the obligation supported by the Letter of
Credit or any other agreement or instrument relating thereto
(collectively, the "Related LC Documents");
36
(ii) any amendment or waiver of or any consent to or
departure from all or any of the Related LC Documents;
(iii) the existence of any claim, setoff, defense
(other than the defense of payment in accordance with the
terms of this Agreement) or other rights which the Borrower
may have at any time against any beneficiary or any transferee
of a Letter of Credit (or any persons or entities for whom any
such beneficiary or any such transferee may be acting), the
Agent, the Lenders or any other Person, whether in connection
with the Loan Documents, the Related LC Documents or any
unrelated transaction;
(iv) any breach of contract or other dispute between
the Borrower and any beneficiary or any transferee of a Letter
of Credit (or any persons or entities for whom such
beneficiary or any such transferee may be acting), the Agent,
the Lenders or any other Person;
(v) any draft, statement or any other document
presented under the 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
whatsoever;
(vi) any delay, extension of time, renewal,
compromise or other indulgence or modification granted or
agreed to by the Agent, with or without notice to or approval
by the Borrower in respect of any of Borrower's Obligations
under this Agreement; or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing.
3.3. Letter of Credit Facility Fees.
--------------------------------
The Borrower shall pay to the Agent (a) for the pro rata benefit of the xxxxxx
based on their Applicable Commitment Percentages, a fee on the aggregate amount
available to be drawn on each outstanding Letter of Credit at a rate equal to
the Applicable Margin for the fee for Letters of Credit and (b) for the benefit
of the Issuing Bank, 0.125% per annum based on the aggregate amount available to
be drawn on each outstanding Letter of Credit. Such fees shall be due quarterly
in arrears on the last day of each March, June, September and December the first
such payment to be made on the first such date occurring after the date of
issuance of a Letter of Credit. The fees described in this Section 3.3 shall be
calculated on the basis of a year of 360 days for the actual number of days
elapsed.
3.4. Administrative Fees.
--------------------
The Borrower shall pay to the Issuing Bank such administrative fee and other
fees, if any,in connection with the Letters of Credit in such amounts and at
such times as the Issuing Bank and the Borrower shall agree from time to time.
37
ARTICLE IV
----------
Change in Circumstances
-----------------------
4.1. Increased Cost and Reduced Return.
----------------------------------
(a) If, after the date hereof, the adoption of any applicable
law, rule, or regulation, or any change in any applicable law, rule, or
regulation, or any change in the interpretation or administration thereof by any
governmental authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of law) of any such governmental authority, central bank, or
comparable agency:
(i) shall subject such Lender (or its Applicable
Lending Office) to any tax, duty, or other charge with respect to any
Loans, Letters of Credit, its Note, or its obligation to make Loans, or
change the basis of taxation of any amounts payable to such Lender (or
its Applicable Lending Office) under this Agreement or its Note in
respect of any Loans (other than taxes imposed on the overall net
income of such Lender by the jurisdiction in which such Lender has its
principal office or such Applicable Lending Office) and taxes for which
indemnification is provided under Section 4.6 hereof;
(ii) shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar requirement (other
than the Reserve Requirement utilized in the determination of the
Eurodollar Rate) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities or commitments of, such
Lender (or its Applicable Lending Office), including the Revolving
Credit Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable
Lending Office) or on the London interbank market any other condition
affecting this Agreement or its Note or any of such extensions of
credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, Converting into, Continuing, or
maintaining any Loans or to reduce any sum received or receivable by such Lender
(or its Applicable Lending Office) under this Agreement or its Note with respect
to any Loans or Letters of Credit, then the Borrower shall pay to such Lender on
demand such amount or amounts as will compensate such Lender for such increased
cost or reduction. If any Lender requests compensation by the Borrower under
this Section 4.1(a), the Borrower may, by notice to such Lender (with a copy to
the Agent), suspend the obligation of such Lender to make or Continue Loans of
the Type with respect to which such compensation is requested, or to Convert
Loans of any other Type into Loans of such Type, until the event or condition
giving rise to such request ceases to be in effect (in which case the provisions
of Section 4.4 shall be applicable); provided that such suspension shall not
affect the right of such Lender to receive the compensation so requested.
38
(b) If, after the date hereof, any Lender shall have
determined that the adoption of any applicable law, rule, or regulation
regarding capital adequacy or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
any request or directive regarding capital adequacy (whether or not having the
force of law) of any such governmental authority, central bank, or comparable
agency, has or would have the effect of reducing the rate of return on the
capital of such Lender or any corporation controlling such Lender as a
consequence of such Lender's obligations hereunder to a level below that which
such Lender or such corporation could have achieved but for such adoption,
change, request, or directive (taking into consideration its policies with
respect to capital adequacy), then from time to time upon demand the Borrower
shall pay to such Lender such additional amount or amounts as will compensate
such Lender for such reduction.
(c) Each Lender shall promptly notify the Borrower and the
Agent of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Lender to compensation pursuant to this Section 4.1 and
will designate a different Applicable Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Lender, be otherwise disadvantageous to it. Any Lender
claiming compensation under this Section 4.1 shall furnish to the Borrower and
the Agent a statement setting forth the additional amount or amounts to be paid
to it hereunder which shall be conclusive in the absence of manifest error. In
determining such amount, such Lender may use any reasonable averaging and
attribution methods.
4.2. Limitation on Types of Loans.
----------------------------
If on or prior to the first day of any Interest Period for any Eurodollar Rate
Loan:
(a) the Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period; or
(b) the Required Lenders determine (which determination shall
be conclusive) and notify the Agent that the Eurodollar Rate will not
adequately and fairly reflect the cost to the Lenders of funding
Eurodollar Rate Loans for such Interest Period;
then the Agent shall give the Borrower prompt notice thereof specifying the
relevant Type of Loans and the relevant amounts or periods, and so long as such
condition remains in effect, the Lenders shall be under no obligation to make
additional Loans of such Type, Continue Loans of such Type, or to Convert Loans
of any other Type into Loans of such Type and the Borrower shall, on the last
day(s) of the then current Interest Period(s) for the outstanding Loans of the
affected Type, either prepay such Loans or Convert such Loans into another Type
of Loan in accordance with the terms of this Agreement.
4.3. Illegality.
-----------
Notwithstanding any other provision of this Agreement, in the event that it
becomes unlawful for any Lender or its Applicable Lending Office to make,
maintain, or fund Eurodollar Rate Loans herunder, then such Lender shall
39
promptly notify the Borrower thereof and such Lender's obligation to make or
Continue Eurodollar Rate Loans and to Convert other Types of Loans into
Eurodollar Rate Loans shall be suspended until such time as such Lender may
again make, maintain, and fund Eurodollar Rate Loans (in which case the
provisions of Section 6.4 shall be applicable).
4.4. Treatment of Affected Loans.
-----------------------------
If the obligation of any Lender to make a Eurodollar Rate Loan or to Continue,
or to Convert Loans of any other Type into, Loans of a particular Type shall be
suspended pursuant to Section 4.1 or 4.3 hereof (Loans of such Type being herein
called "Affected Loans" and such Type being herein called the "Affected Type") ,
such Lender's Affected Loans shall be automatically Converted into Base Rate
Loans on the last day(s) of the then current Interest Period(s) for Affected
Loans (or, in the case of a Conversion required by Section 4.3 hereof, on such
earlier date as such Lender may specify to the Borrower with a copy to the
Agent) and, unless and until such Lender gives notice as provided below that the
circumstances specified in Section 4.1 or 4.3 hereof that gave rise to such
Conversion no longer exist:
(a) to the extent that such Lender's Affected Loans have been
so Converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Affected Loans shall be applied
instead to its Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by
such Lender as Loans of the Affected Type shall be made or Continued
instead as Base Rate Loans, and all Loans of such Lender that would
otherwise be Converted into Loans of the Affected Type shall be
Converted instead into (or shall remain as) Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 4.1 or 4.3 hereof that gave rise to the
Conversion of such Lender's Affected Loans pursuant to this Section 4.4 no
longer exist (which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Loans of the Affected Type made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Loans of the Affected Type, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding Loans of the
Affected Type and by such Lender are held pro rata (as to principal amounts,
Types, and Interest Periods) in accordance with their respective Revolving
Credit Commitments.
4.5. Compensation
------------
Upon the request of any Lender, the Borrower shall pay to such Lender such
amount or amounts as shall compensate it for any loss, cost, or reasonable
expense (including loss of anticipated profits) incurred by it as a result of:
(a) any payment, prepayment, or Conversion of a Eurodollar
Rate Loan for any reason (including, without limitation, the
acceleration of the Loans pursuant to Section 9.1 hereof) on a date
other than the last day of the Interest Period for such Loan; or
40
(b) any failure by the Borrower for any reason (including,
without limitation, the failure of any condition precedent specified in
Article V to be satisfied) to borrow, Convert, Continue, or prepay a
Eurodollar Rate Loan on the date for such borrowing, Conversion,
Continuation, or prepayment specified in the relevant notice of
borrowing, prepayment, Continuation, or Conversion under this
Agreement.
Any Lender claiming compensation under this Section 4.5 shall furnish
to the Borrower and the Agent a statement setting forth in reasonable detail the
calculation of amounts to be paid to it hereunder.
4.6. Taxes.
------
(a) Any and all payments by the Borrower to or for the
account of any Lender or the Agent hereunder or under any other Loan Document
shall be made free and clear of and without deduction for any and all present or
future taxes, duties, levies, imposts, deductions, charges or withholdings, and
all liabilities with respect thereto, excluding, in the case of each Lender and
the Agent, taxes imposed on its income, and franchise taxes imposed on it, by
the jurisdiction under the laws of which such Lender (or its Applicable Lending
Office) or the Agent (as the case may be) is organized or any political
subdivision thereof, other than to the extent such income or franchise tax is
imposed solely as a result of the activities of the Agent or a Lender pursuant
to or in respect of this Agreement or any of the other Loan Documents (all such
non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings,
and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by law to deduct any Taxes from or in respect of any sum payable
under this Agreement or any other Loan Document to any Lender or the Agent, (i)
the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 4.6) such Lender or the Agent receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions, (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law, and (iv) the Borrower shall furnish to the Agent, at its
address referred to in Section 11.2 hereof, the original or a certified copy of
a receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any and all
present or future stamp or documentary taxes and any other excise or property
taxes or charges or similar levies which arise from any payment made under this
Agreement or any other Loan Document or from the execution or delivery of, or
otherwise with respect to, this Agreement or any other Loan Document
(hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Lender and the Agent
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section 4.6) paid by such Lender or the Agent (as the case may be)
and any liability (including penalties, interest, and expenses) arising
therefrom or with respect thereto.
41
(d) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Lender listed on the signature pages
hereof and on or prior to the date on which it becomes a Lender in the case of
each other Lender, and from time to time thereafter if requested in writing by
the Borrower or the Agent (but only so long as such Lender remains lawfully able
to do so), shall provide the Borrower and the Agent with (i) a properly
completed Internal Revenue Service Form 1001 or 4224, as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying that such
Lender is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States, (ii) a properly completed Internal Revenue Service Form W-8 or W-9, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Lender is exempt from United States backup withholding, and
(iii) any other form or certificate required by any taxing authority (including
any certificate required by Sections 871(h) and 881(c) of the Internal Revenue
Code), certifying that such Lender is entitled to an exemption from or a reduced
rate of tax on payments pursuant to this Agreement or any of the other Loan
Documents.
(e) For any period with respect to which a Lender has failed
to provide the Borrower and the Agent with the appropriate form pursuant to
Section 4.6(d) hereof (unless such failure is due to a change in treaty, law, or
regulation occurring subsequent to the date on which a form originally was
required to be provided), such Lender shall not be entitled to indemnification
under Section 4.6(a) or 4.6(b) hereof with respect to Taxes imposed by the
United States; provided, however, that should a Lender, which is otherwise
exempt from or subject to a reduced rate of withholding tax, become subject to
Taxes because of its failure to deliver a form required hereunder, the Borrower
shall take such steps as such Lender shall reasonably request and at such
Lender's cost to assist such Lender to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to
or for the account of any Lender pursuant to this Section 4.6, then such Lender
will agree to use reasonable efforts to change the jurisdiction of its
Applicable Lending Office so as to eliminate or reduce any such additional
payment which may thereafter accrue if such change, in the judgment of such
Lender, is not otherwise disadvantageous to such Lender.
(g) Within thirty (30) days after the date of any payment of
Taxes, the Borrower shall furnish to the Agent the original or a certified copy
of a receipt evidencing such payment.
(h) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 4.6 shall survive until the first anniversary of the
Facility Termination Date.
(i) If the Borrower makes any additional payment to any Lender
pursuant to this Section 4.6 in respect of any Taxes, and such Lender determines
that it has received (i) a refund of such Taxes, or (ii) a credit against,
relief or remission for, or a reduction in the amount of, any taxes or other
42
governmental charge as a result of any deduction or credit for any Taxes with
respect to which it has received payments under this Section 4.6, such Lender
shall, to the extent that it can do so without prejudice to the retention of
such refund, credit, relief, remission or reduction, pay to the Borrower such
amount as shall be reasonably determined by such Lender to be solely
attributable to the deduction or withholding of such Taxes. If such Lender later
determines that it was not entitled to such refund, credit, relief, remission or
reduction to the full extent of any payment made pursuant to the first sentence
of this Section 4.6(i), the Borrower shall upon demand of such Lender promptly
repay the amount of such overpayment. Nothing in this Section 4.6(i) shall be
construed as requiring such Lender to conduct its business or to arrange or
alter in any respect its tax or financial affairs so that it is entitled to
receive such a refund, credit or reduction or as allowing any Person to inspect
any records, including tax returns, of such Lender.
43
ARTICLE V
-----------
Conditions to Making Loans and Issuing Letters of Credit
-------------------------------------------------------
5.1. Conditions of Initial Advance of Revolving Loans and Initial
-----------------------------------------------------------------
Issuance of Letters of Credit.
--------------------------------
The obligations of the Lenders to make the initial Advance under the Revolving
Credit Facility and of NationsBank to make any Swing Line Loan and of the
Issuing Bank to issue any Letter of Credit, are subject to the conditions
precedent that:
(a) the Agent shall have received on the Closing Date, in form
and substance satisfactory to the Agent and Lenders, the following:
(i) executed originals of each of this Agreement,
the Notes, the initial Subsidiary Guaranties and the other
Loan Documents, together with all schedules and exhibits
thereto;
(ii) the favorable written opinion or opinions with
respect to the Loan Documents and the transactions
contemplated thereby of special counsel to the Credit Parties
dated the Closing Date, addressed to the Agent and the Lenders
and reasonably satisfactory to Xxxxx Xxxxx Mulliss & Xxxxx,
L.L.P., special counsel to the Agent;
(iii) resolutions of the boards of directors or other
appropriate governing body (or of the appropriate committee
thereof) of each Credit Party certified by its secretary, or
assistant secretary as of the Closing Date, approving and
adopting the Loan Documents to be executed by such Person, and
authorizing the execution and delivery thereof;
(iv) specimen signatures of officers of each of the
Credit Parties executing the Loan Documents on behalf of such
Credit Party, certified by the secretary or assistant
secretary of such Credit Party;
(v) the Organizational Documents of each of the
Credit Parties certified as of a recent date by the Secretary
of State of its state of organization;
(vi) the Operating Documents of each of the Credit
Parties certified as of the Closing Date as true and correct
by its secretary or assistant secretary;
(vii) certificates issued as of a recent date by the
Secretaries of State of the respective jurisdictions of
formation of each of the Credit Parties as to the due
existence and good standing of such Person;
(viii) appropriate certificates of qualification to
do business, good standing and, where appropriate, authority
to conduct business under assumed name, issued
44
in respect of each of the Credit Parties as of a recent date
by the Secretary of State or comparable official of each
jurisdiction in which the failure to be qualified to do
business or authorized so to conduct business could reasonably
be likely to have a Material Adverse Effect;
(ix) notice of appointment of the initial Authorized
Representative(s);
(x) certificate of an Authorized Representative
dated the Closing Date demonstrating compliance with the
financial covenants contained in Sections 8.1(a) through
8.1(d) hereof as of the Closing Date, substantially in the
form of Exhibit H;
(xi) evidence of all insurance required by the Loan
Documents;
(xii) an initial Borrowing Notice, if any, and, if
elected by the Borrower, Interest Rate Selection Notice;
(xiii) evidence that all fees payable by the Borrower
on the Closing Date to the Agent, NCMI and the Lenders have
been paid in full;
(xiv) a certificate of an Authorized Representative
as to the matters set forth in Section 5.1(b) hereof; and
(xv) such other documents, instruments, certificates
and opinions as the Agent or any Lender may reasonably request
on or prior to the Closing Date in connection with the
consummation of the transactions contemplated hereby;
(b) In the good faith judgment of the Agent and the Lenders:
(i) there shall not have occurred (A) any material
adverse change in the business, assets, revenues, operations
or condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole since June 28,
1997 and (B) any event, condition, situation or status of, or
change in the facts, assumptions or information regarding, the
Borrower and its Subsidiaries, since the date of the
information contained in the financial and business
projections, budgets, pro forma data and forecasts concerning
the Borrower and its Subsidiaries delivered to the Agent prior
to the Closing Date that has had or could reasonably be
expected to result in a Material Adverse Effect;
(ii) no litigation, action, suit, investigation or
other arbitral, administrative or judicial proceeding before
any arbitrator or Governmental Authority shall be pending or
threatened which purports to affect the transactions
contemplated under the Loan Documents or which could
reasonably be likely to result in a Material Adverse Effect;
45
(iii) the Credit Parties shall have received all
approvals, consents and waivers, and shall have made or given
all necessary filings and notices as shall be required to
consummate the transactions contemplated hereby without the
occurrence of any default under, conflict with or violation of
(A) any applicable law, rule, regulation, order or decree of
any Governmental Authority or arbitral authority or (B) any
agreement, document or instrument to which any of the Credit
Parties is a party or by which any of them or their properties
is bound; and
(iv) there shall not have occurred and be continuing
a material adverse change in the market for syndicated credit
facilities similar in nature to the Facilities or a material
disruption of, or a material adverse change in, financial,
banking or capital market conditions, in each case as
determined by the Agent in its reasonable discretion; and
(c) the Existing Letter of Credit Agreement shall have been
terminated and all letters of credit outstanding thereunder shall be
deemed Letters of Credit hereunder.
5.2. Conditions of Revolving Loans and Letter of Credit.
----------------------------------------------------------
The obligations of the Lenders to make any Revolving Loans and of NationsBank to
make any Swing Line Loan and the Issuing Bank to issue Letters of Credit,
hereunder on or subsequent to the Closing Date are subject to the satisfaction
of the following conditions:
(a) the Agent (or, in the case of Swing Line Loans,
NationsBank) shall have received a Borrowing Notice if required by
Article II hereof;
(b) the representations and warranties of the Credit Parties
set forth in Article VI hereof and in each of the other Loan Documents
shall be true and correct in all material respects on and as of the
date of such Advance or Swing Line Loan or Letter of Credit issuance or
renewal, with the same effect as though such representations and
warranties had been made on and as of such date, except to the extent
that such representations and warranties expressly relate to an earlier
date and except that the financial statements referred to in Section
6.6(a) hereof shall be deemed to be those financial statements most
recently delivered to the Agent and the Lenders pursuant to Section 7.1
hereof from the date financial statements are delivered to the Agent
and the Lenders in accordance with such Section;
(c) in the case of the issuance of a Letter of Credit, the
Borrower shall have executed and delivered to the Issuing Bank an
Application and Agreement for Letter of Credit in form and content
acceptable to the Issuing Bank together with such other instruments and
documents as it shall reasonably request;
(d) at the time of (and after giving effect to) each Advance
or Swing Line Loan or the issuance of a Letter of Credit, no Default or
Event of Default shall have occurred and be continuing; and
46
(e) immediately after giving effect to:
(i) a Revolving Loan, the aggregate principal balance
of all outstanding Revolving Loans for each Lender shall not
exceed such Lender's Revolving Credit Commitment;
(ii) a Swing Line Loan, the aggregate principal
balance of all Swing Line Outstandings shall not exceed
$5,000,000;
(iii) a Letter of Credit or renewal thereof, the
aggregate principal balance of all outstanding Participations
in Letters of Credit and Reimbursement Obligations (or in the
case of the Issuing Bank, its remaining interest after
deduction of all Participations in Letters of Credit and
Reimbursement Obligations of other Lenders) for each Lender
and in the aggregate shall not exceed, respectively, (A) such
Lender's Letter of Credit Commitment or (B) the Total Letter
of Credit Commitment;
(iv) a Revolving Loan, a Swing Line Loan or a Letter
of Credit or renewal thereof, the sum of all Outstandings
shall not exceed the Total Revolving Credit Commitment.
47
ARTICLE VI
----------
Representations and Warranties
------------------------------
The Borrower represents and warrants with respect to itself and to its
Subsidiaries (which representations and warranties shall survive the delivery of
the documents mentioned herein and the making of Loans), that:
6.1. Organization and Authority.
---------------------------
(a) The Borrower and each Significant Subsidiary is a
corporation duly organized and validly existing under the laws of the
jurisdiction of its formation;
(b) The Borrower and each Significant Subsidiary (i) has the
requisite power and authority to own its properties and assets and to
carry on its business as now being conducted and as contemplated in the
Loan Documents, and (ii) is qualified to do business in every
jurisdiction in which failure so to qualify could reasonably be likely
to have a Material Adverse Effect;
(c) The Borrower has the power and authority to execute,
deliver and perform this Agreement and the Notes, and to borrow
hereunder, and to execute, deliver and perform each of the other Loan
Documents to which it is a party;
(d) Each Material Subsidiary has the power and authority to
execute, deliver and perform the Subsidiary Guaranty and each of the
other Loan Documents to which it is a party; and
(e) When executed and delivered, each of the Loan Documents to
which any Credit Party is a party will be the legal, valid and binding
obligation or agreement, as the case may be, of such Credit Party,
enforceable against such Credit Party in accordance with its terms,
subject to the effect of any applicable bankruptcy, moratorium,
insolvency, reorganization or other similar law affecting the
enforceability of creditors' rights generally and to the effect of
general principles of equity (whether considered in a proceeding at law
or in equity);
6.2. Loan Documents.
--------------
The execution, delivery and performance by each Credit Party of each of the Loan
Documents to which it is a party:
(a) have been duly authorized by all requisite Organizational
Action (including any required shareholder or partner approval) of such
Credit Party required for the lawful execution, delivery and
performance thereof;
(b) do not violate any provisions of (i) applicable law, rule
or regulation, (ii) any judgment, writ, order, determination, decree or
arbitral award of any Governmental Authority or arbitral authority
48
binding on such Credit Party or its properties, or (iii) the
Organizational Documents or Operating Documents of such Credit Party;
(c) does not and will not be in conflict with, result in a
breach of or constitute an event of default, or an event which, with
notice or lapse of time or both, would constitute an event of default,
under any contract, indenture, agreement or other instrument or
document to which such Credit Party is a party, or by which the
properties or assets of such Credit Party are bound; and
(d) does not and will not result in the creation or imposition
of any Lien upon any of the properties or assets of such Credit Party;
6.3. Solvency.
--------
Each Credit Party is Solvent after giving effect to the transactions
contemplated by the Loan Documents;
6.4. Ownership of the Borrower and its Subsidiaries.
----------------------------------------------
The Borrower has no Significant Subsidiaries other than those Persons listed as
Significant Subsidiaries in Schedule 6.4 and additional Subsidiaries created or
acquired after the Closing Date. Schedule 6.4 states as of the date hereof the
organizational form of the Borrower and each Significant Subsidiary, the
authorized and issued capitalization of the Borrower listed thereon, the number
of shares or other equity interests of each class of capital stock or interest
issued and outstanding of the Borrower and the number or percentage of
outstanding shares or other equity interest (including options, warrants and
other rights to acquire any interest) of such class of capital stock or other
equity interest of each Significant Subsidiary owned by Borrower or by any such
Significant Subsidiary.
The outstanding shares or other equity interests of the Borrower and each such
Significant Subsidiary have been duly authorized and validly issued and are
fully paid and nonassessable and the Borrower and each such Significant
Subsidiary owns beneficially and of record all the shares and other interests it
is listed as owning in Schedule 6.4, free and clear of any Lien;
6.5. Borrower Ownership Interests.
----------------------------
Borrower owns no interest in any Person other than the Persons listed in
Schedule 6.4, equity investments in Persons not constituting Subsidiaries
permitted under Section 8.6 hereof and additional Subsidiaries created or
acquired after the Closing Date;
6.6. Financial Condition.
--------------------
(a) The Borrower has heretofore furnished to each Lender an
audited consolidated balance sheet of the Borrower and its Subsidiaries
as at September 28, 1996 and the notes thereto and the related
consolidated statements of income, stockholders' equity and cash flows
for the Fiscal Year then ended as examined and certified by Price
Waterhouse, and unaudited consolidated interim financial statements of
the Borrower and its Subsidiaries consisting of consolidated balance
sheets and related consolidated and consolidating statements of income,
stockholders' equity and cash flows, in each case without notes, for
and as of the end of the nine month period ending June 28, 1997.
49
Except as set forth therein, such financial statements (including the
notes thereto) present fairly the financial condition of the Borrower
and its Subsidiaries as of the end of such Fiscal Year and six month
period and results of their operations and the changes in its
stockholders' equity for the Fiscal Year and interim period then ended,
all in conformity with GAAP, subject however, in the case of unaudited
interim statements to normal, recurring year end audit adjustments;
(b) since September 28, 1996 there has been no material
adverse change in the condition, financial or otherwise, of the
Borrower and its Subsidiaries taken as a whole or in the businesses,
properties, performance, prospects or operations of the Borrower and
its Subsidiaries taken as a whole, nor have such businesses or
properties taken as a whole been materially adversely affected as a
result of any fire, explosion, earthquake, accident, strike, lockout,
combination of workers, flood, embargo or act of God; and
(c) except as set forth in the financial statements referred
to in Section 6.6(a) hereof or on Schedule 6.6 hereto, neither Borrower
nor any Subsidiary has incurred, other than in the ordinary course of
business, any (i) Indebtedness, (ii) Contingent Obligation or (iii)
other commitment or liability which remains outstanding or unsatisfied,
which are material to the Borrower and its Subsidiaries taken as a
whole;
6.7. Title to Properties.
-------------------
The Borrower and each Material Subsidiary has good title to all its real and
personal properties, subject to no transfer restrictions or Liens of any kind,
except for Permitted Liens;
6.8. Taxes.
------
The Borrower and each of its Significant Subsidiaries has filed or caused to be
filed all federal, state and local tax returns which are required to be filed by
it and, except for taxes and assessments being contested in good faith by
appropriate proceedings diligently conducted and against which reserves
reflected in the financial statements described in Section 6.6(a) hereof and as
required by GAAP have been established, have paid or caused to be paid all taxes
as shown on said returns or on any assessment received by it, to the extent that
such taxes have become due and payable;
6.9. Other Agreements.
-----------------
Neither the Borrower nor any Subsidiary is
(a) a party to or subject to any judgment, order, decree,
agreement, lease or instrument, or subject to other restrictions, which
individually or in the aggregate could reasonably be expected to have a
Material Adverse Effect or would result in or require the creation of a
Lien on the property or assets of any Credit Party; or
(b) in default in the performance, observance or fulfillment
of any of the obligations, covenants or conditions contained in any
agreement or instrument to which any Subsidiary is a party, which
default has, or if not remedied within any applicable grace period
could reasonably be likely to have, a Material Adverse Effect; or
50
(c) is a party to any indenture, loan or credit agreement or
any lease or other agreement or instrument or subject to any charter or
corporate restriction that could reasonably be expected to have, and no
provision of applicable law or governmental regulation could reasonably
be expected to have, a material adverse effect on the ability of the
Borrower to carry out its obligations under this Agreement or any other
Loan Document as such obligations become due.
6.10. Litigation.
----------
There is no action, suit, investigation or proceeding at law or in equity or by
or before any governmental instrumentality or agency or arbitral body pending,
or, to the knowledge of any Responsible Officer, threatened by or against the
Borrower or any Subsidiary that (i) is reasonably likely to be determined
adversely to the Borrower or such Subsidiary and which, if determined adversely
to the Borrower or such Subsidiary, could reasonably be likely to have a
Material Adverse Effect or (ii) questions the validity or enforceability of, or
the ability of any Credit Party to perform under, any Loan Document;
6.11. Margin Stock.
-------------
The proceeds of the borrowings made hereunder will be used by the Borrower only
for the purposes expressly authorized herein. None of such proceeds will be used
directly or indirectly, for the purpose of purchasing or carrying any margin
stock or for the purpose of reducing or retiring any Indebtedness which was
originally incurred to purchase or carry margin stock or for any other purpose
which might constitute any of the Loans under this Agreement a "purpose credit"
within the meaning of said Regulation U or Regulation X (12 C.F.R. Part 224) of
the Board. Neither the Borrower nor any agent acting in its behalf has taken or
will take any action which might cause this Agreement or any of the documents or
instruments delivered pursuant hereto to violate any regulation of the Board or
to violate the Securities Exchange Act of 1934, as amended, or the Securities
Act of 1933, as amended, or any state securities laws, in each case as in effect
on the date hereof;
6.12. Investment Company; Public Utility Holding Company.
--------------------------------------------------
Neither the Borrower nor any Subsidiary is (a) an "investment company," or an
"affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company", as such terms are defined in the Investment Company Act of
1940, as amended (15 U.S.C. ss. 80a-1, et seq.) or (b) a "holding company" as
defined in, or otherwise subject to regulation under, the Public Utility Holding
Company Act of 1935, as amended;
6.13. Intellectual Property.
-----------------------
To the knowledge of each Responsible Officer, each of the Credit Parties owns,
or has a license or otherwise has the right to use, in all jurisdictions in
which it carries on business, all patents (including all applications, renewals,
reissues, extensions, divisions, continuations and extensions thereof)
trademarks (including both registered and unregistered trademarks and
applications therefor), service marks, trade names, copyrights (including all
registrations, renewals, modifications and extensions thereof), and know-how and
trade secrets of material importance to the conduct of its business as currently
conducted (collectively, the "Intellectual Property"), without violating or
conflicting with any patent, license, franchise, trademark, trade secret, trade
name, copyright, or other proprietary rights of any other Person, except where
the failure to so own or have the right to use or such conflict could not
51
reasonably be expected to have a Material Adverse Effect. None of the
Intellectual Property is subject to any Lien other than Permitted Liens;
6.14. No Untrue Statement.
---------------------
Neither (a) this Agreement nor any other Loan Document or certificate or
document executed and delivered by or on behalf of the Borrower or any other
Credit Party in accordance with or pursuant to any Loan Document nor (b) any
statement, representation, or warranty contained in the Loan Documents contains
any misrepresentation or untrue statement of material fact or omits to state a
material fact necessary, in light of the circumstance under which it was made,
in order to make any such warranty, representation or statement contained
therein not misleading in any material respect, and, to the extent that any such
written statements constitute projections, such projections were prepared in
good faith on the basis of assumptions, methods, data, tests and information
believed by the Borrower to be valid and accurate at the time such projections
were furnished to the Agent or such governmental authority, as the case may be;
6.15. No Consents, Etc.
-----------------
Neither the respective businesses or properties of the Borrower or any
Subsidiary, nor any relationship among the Borrower and its Subsidiaries and any
other Person, nor any circumstance in connection with the execution, delivery
and performance of the Loan Documents and the transactions contemplated thereby,
is such as to require a consent, approval or authorization of, or filing,
registration or qualification with, any Governmental Authority or any other
Person on the part of the Borrower or any Subsidiary as a condition to the
execution, delivery and performance of, or consummation of the transactions
contemplated by the Loan Documents, or if so, such consent, approval,
authorization, filing, registration or qualification has been duly obtained or
effected, as the case may be;
6.16. Employee Benefit Plans.
----------------------
(a) The Borrower and each ERISA Affiliate is in compliance
with all applicable provisions of ERISA and the regulations and
published interpretations thereunder and in compliance with all Foreign
Benefit Laws with respect to all Employee Benefit Plans except for any
required amendments for which the remedial amendment period as defined
in Section 401(b) of the Code has not yet expired and except to the
extent non-compliance does not or is not reasonably expected to have a
Material Adverse Effect. Each Employee Benefit Plan that is intended to
be qualified under Section 401(a) of the Code has been determined by
the Internal Revenue Service to be so qualified. No material liability
has been incurred by the Borrower or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties with respect to any Employee
Benefit Plan or any Multiemployer Plan;
(b) Neither the Borrower nor any ERISA Affiliate has (i)
engaged in a nonexempt prohibited transaction described in Section 4975
of the Code or Section 406 of ERISA affecting any of the Employee
Benefit Plans or the trusts created thereunder which could subject any
such Employee Benefit Plan or trust to a material tax or penalty on
prohibited transactions imposed under Internal Revenue Code Section
4975 or ERISA, (ii) incurred any accumulated funding deficiency within
the meaning of Section 412 of the
52
Code with respect to any Pension Plan, whether or not waived, or any
other material liability to the PBGC which remains outstanding other
than the payment of premiums, (iii) failed to make a required
contribution or payment to a Multiemployer Plan, or (iv) failed to make
a required installment or other required payment under Section 412 of
the Code, Section 302 of ERISA or the terms of such Employee Benefit
Plan which, if not contributed, could reasonably be expected to have a
Material Adverse Effect;
(c) No Termination Event has occurred or is reasonably
expected to occur with respect to any Pension Plan or Multiemployer
Plan, and neither the Borrower nor any ERISA Affiliate has incurred any
unpaid withdrawal liability with respect to any Multiemployer Plan;
(d) The present value of all vested accrued benefits under
each Employee Benefit Plan which is subject to Title IV of ERISA
(determined in accordance with the assumptions used to compute the
minimum funding standards under Section 302(b) of ERISA), did not, as
of the most recent valuation date for each such plan, exceed the then
current value of the assets of such Employee Benefit Plan allocable to
such benefits;
(e) To the Borrower's knowledge, each Employee Benefit Plan
subject to Title IV of ERISA, maintained by the Borrower or any ERISA
Affiliate, has been administered in accordance with its terms in all
material respects and is in compliance in all material respects with
all applicable requirements of ERISA and other applicable laws,
regulations and rules except for any compliance for which the remedial
amendment period as defined in Section 401(b) of the Code has not yet
expired and except to the extent non-compliance does not or is not
reasonably expected to have a Material Adverse Effect;
(f) No material proceeding, claim, lawsuit and/or
investigation exists or, to the best knowledge of the Borrower after
due inquiry, is threatened concerning or involving any Employee Benefit
Plan;
6.17. No Default.
----------
As of the date hereof, there does not exist any Default or Event of Default
hereunder;
6.18. Hazardous Materials.
--------------------
The Borrower and each Subsidiary is in compliance with all applicable
Environmental Laws except to the xtent non-compliance could not reasonably be
expected to have a Material Adverse Effect. Neither the Borrower nor any
Subsidiary has been notified of any action, suit, proceeding or investigation
which (i) calls into question compliance by the Borrower or any Subsidiary with
any Environmental Laws, (ii) which seeks to suspend, revoke or terminate any
license, permit or approval necessary for the generation, handling, storage,
treatment or disposal of any Hazardous Material, or (iii) which seeks to cause
any property of the Borrower or any Subsidiary to be subject to any restrictions
on ownership, use, occupancy or transferability under any Environmental Law to
the extent any such non-compliance, suspension revocation or restriction,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect;
53
6.19. Employment Matters.
------------------
(a) None of the employees of the Borrower or any Subsidiary
is subject to any collective bargaining agreement and there are no strikes, work
stoppages, election or decertification petitions or proceedings, unfair labor
charges, equal opportunity proceedings, or other material labor/employee related
controversies or proceedings pending or, to the knowledge of a Responsible
Officer, threatened against the Borrower or any Subsidiary or between the
Borrower or any Subsidiary and any of its employees, other than to the extent
the foregoing arise in the ordinary course of business and could not reasonably
be expected, individually or in the aggregate, to have a Material Adverse
Effect; and
(b) Except to the extent a failure to maintain compliance
could not reasonably be expected to have a Material Adverse Effect, the Borrower
and each Subsidiary is in compliance in all respects with all applicable laws,
rules and regulations pertaining to labor or employment matters, including
without limitation those pertaining to wages, hours, occupational afety and
taxation and there is neither pending or threatened any litigation,
administrative proceeding nor, to the knowledge of a Responsible Officer, any
investigation, in respect of such matters which, if decided adversely, could
reasonably be likely, individually or in the aggregate, to have a Material
Adverse Effect.
54
ARTICLE VII
-----------
Affirmative Covenants
---------------------
Until the Facility Termination Date, unless the Required Lenders shall
otherwise consent in writing, the Borrower will, and where applicable will cause
each Subsidiary to:
7.1. Financial Reports, Etc.
------------------------
(a) As soon as practical and in any event within 90 days after
the end of each Fiscal Year of the Borrower, deliver or cause to be delivered to
the Agent and each Lender (i) consolidated balance sheets of the Borrower and
its Subsidiaries as at the end of such Fiscal Year, and the notes thereto, and
the related consolidated statements of income, stockholders' equity and cash
flows, and the respective notes thereto, for such Fiscal Year, setting forth
comparative financial statements for the preceding Fiscal Year, all prepared in
accordance with GAAP applied on a Consistent Basis, except to the extent GAAP
requires application of different accounting principles, and containing, with
respect to the consolidated financial statements, opinions of Price Waterhouse,
or other independent certified public accountants of Nationally Recognized
Standing, which are unqualified as to the scope of the audit performed and as to
the "going concern" status of the Borrower and without any exception not
acceptable to the Lenders, and (ii) a certificate of an Authorized
Representative demonstrating compliance with Sections 8.1(a) through 8.1(d)
hereof, which certificate shall be in the form of Exhibit H;
(b) as soon as practical and in any event within 45 days after
the end of each fiscal quarter (except the last fiscal quarter of the Fiscal
Year), deliver to the Agent and each Lender (i) consolidated balance sheets of
the Borrower and its Subsidiaries as at the end of such fiscal quarter, and the
related consolidated statements of income, stockholders' equity and cash flows
for such fiscal quarter and for the period from the beginning of the then
current Fiscal Year through the end of such reporting period, and accompanied by
a certificate of an Authorized Representative to the effect that such financial
statements present fairly the financial position of the Borrower and its
Subsidiaries as of the end of such fiscal period and the results of their
operations and the changes in their financial position for such fiscal period,
in conformity with the standards set forth in Section 6.6(a) hereof with respect
to interim financial statements, and (ii) a certificate of an Authorized
Representative containing computations for such quarter comparable to that
required pursuant to Section 7.1(a)(ii) hereof;
(c) together with each delivery of the financial statements
required by Section 7.1(a)(i) hereof, deliver to the Agent and each Lender a
letter from the Borrower's accountants specified in Section 7.1(a)(i) hereof
stating that in performing the audit necessary to render an opinion on the
financial statements delivered under Section 7.1(a)(i) hereof, they obtained no
knowledge of any Default or Event of Default by the Borrower in the fulfillment
of the terms and provisions of this Agreement insofar as they relate to
financial matters (which at the date of such statement remains uncured); or if
the accountants have obtained knowledge of such Default or Event of Default, a
statement specifying the nature and period of existence thereof;
55
(d) promptly upon their becoming available to the Borrower,
the Borrower shall deliver to the Agent and each Lender a copy of (i) all
regular or special reports or effective registration statements which Borrower
shall file with the Securities and Exchange Commission (or any successor
thereto) or any securities exchange, (ii) any proxy statement distributed by the
Borrower to its shareholders, bondholders or the financial community in general,
and (iii) any management letter or other report submitted to the Borrower by
independent accountants in connection with any annual or special audit of the
Borrower;
(e) promptly, from time to time, deliver or cause to be
delivered to the Agent and each Lender such other information regarding
Borrower's and any Subsidiary's operations, business affairs and financial
condition as the Agent or such Lender may reasonably request.
The Agent and the Lenders are hereby authorized to deliver a copy of any such
financial or other information delivered hereunder to the Lenders (or any
affiliate of any Lender) or to the Agent, to any Governmental Authority having
jurisdiction over the Agent or any of the Lenders pursuant to any written
request therefor or in the ordinary course of examination of loan files, or to
any other Person who shall acquire or consider the assignment of, or acquisition
of any participation interest in, any Obligation permitted by this Agreement;
7.2. Maintain Properties.
-------------------
Maintain all properties of any Credit Party necessary to its operations in good
working order and condition, as reasonably necessary to conduct its business as
currently conducted or as contemplated hereby and in accordance with customary
and prudent business practices;
7.3. Existence, Qualification, Etc.
--------------------------------
Except as otherwise expressly permitted under Sections 8.5 and 8.7 hereof, do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence and all material rights and franchises, and maintain its
license or qualification to do business as a foreign corporation and good
standing in each jurisdiction in which its ownership or lease of property or the
nature of its business makes such license or qualification necessary except
where the failure to so preserve and keep or maintain the same or to so qualify
could not reasonably be expected to have a Material Adverse Effect;
7.4. Regulations and Taxes.
-----------------------
Comply in all material respects with or contest in good faith all statutes and
governmental regulations and pay all material taxes, assessments, governmental
charges, claims for labor, supplies, rent and any other obligation which, if
unpaid, would become a Lien against any material portion of any Credit Party's
properties except liabilities being contested in good faith by appropriate
proceedings diligently conducted and against which all reserves with respect
thereto as may be required by GAAP have been established unless and until any
Lien resulting therefrom attaches to any of its property and becomes enforceable
against its creditors;
7.5. Insurance.
----------
(a) Keep all of its insurable properties adequately insured at
all times with financially sound and responsible insurance carriers against loss
or damage by fire and other hazards to the extent and in the manner as is
consistent with past practice,
(b) maintain general public liabilityinsurance at all times
56
with responsible insurance carriers against liability on account of damage
to persons and property,
(c) maintain insurance against interruption of its business
operations and,
(d) maintain insurance under all applicable workers'
compensation laws (or in the alternative, maintain required reserves if
self-insured for workers' compensation purposes), all such policies of insurance
to have such limits, deductibles, exclusions, co-insurance and other provisions
providing no less coverages than is consistent with past practice. Each of the
issuers of the policies of insurance described in this Section 7.5 shall
undertake to provide the Agent not less than thirty (30) days' prior written
notice before any such policy shall be terminated, lapse or be altered in any
manner;
7.6. True Books.
-----------
Keep true books of record and account in which, to the extent required by GAAP,
full, true and correct entries will be made of all of its dealings and
transactions, and set up on its books such reserves as may be required by GAAP
with respect to doubtful accounts and all taxes, assessments, charges, levies
and claims and with respect to its business in general, and include such
reserves in interim as well as year-end financial statements;
7.7. Right of Inspection.
--------------------
Permit any Person designated by any Lender or the Agent (such Person to be
subject to a Confidentiality Agreement) to visit and inspect at the Agent's or
such Lender's expense any of the properties, corporate books and financial
reports of the Borrower or any Subsidiary and to discuss its affairs, finances
and accounts with its principal officers and independent certified public
accountants, all at reasonable times, at reasonable intervals and with
reasonable prior notice; provided that, upon and during the continuance of an
Event of Default, all costs and expenses incurred in connection with any such
visits and inspections shall be paid by the Borrower;
7.8. Observe all Laws.
------------------
Conform to and duly observe in all material respects all laws, rules and
regulations and all other valid requirements of any Governmental Authority with
respect to the conduct of its business, except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect;
7.9. Governmental Licenses.
---------------------
Obtain and maintain all licenses, permits, certifications and approvals of all
applicable Governmental Authorities as are required for the conduct of its
business as currently conducted and as contemplated by the Loan Documents,
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect;
7.10. Covenants Extending to Subsidiaries.
------------------------------------
Cause each of its Significant Subsidiaries to do with respect to itself, its
business and its assets, each of the things required of the Borrower in Sections
7.2 through 7.9, 7.18 and 7.19 hereof inclusive;
7.11. Officer's Knowledge of Default.
-------------------------------
Upon any Responsible Officer obtaining knowledge of any Default or Event of
Default hereunder or under any other obligation of the Borrower or other Credit
Party to any Lender, notify the Agent of the nature thereof, the period of
existence thereof and what action the Borrower or other Credit Party proposes to
take with respect thereto;
57
7.12. Suits or Other Proceedings.
-----------------------------
Upon any Responsible Officer obtaining knowledge of any litigation or other
proceedings being instituted against the Borrower or other Credit Party, or any
attachment, levy, execution or other process being instituted against any assets
of the Borrower or any other Credit Party, making a claim or claims in an
aggregate amount greater than $15,000,000 not otherwise covered by insurance,
promptly deliver to the Agent written notice thereof stating the nature and
status of such litigation, dispute, proceeding, levy, execution or other
process;
7.13. Notice of Discharge of Hazardous Material or Environmental Complaint.
---------------------------------------------------------------------
Promptly provide to the Agent true, accurate and complete copies of any and all
notices, complaints, orders, directives, claims, or citations received by the
Borrower or any Significant Subsidiary relating to any (a) material violation or
alleged material violation by any applicable Environmental Law; (b) release or
threatened release by the Borrower or any Significant Subsidiary on any facility
or property owned or leased or operated by the Borrower or any Significant
Subsidiary, of any Hazardous Material, except where occurring legally; or (c)
liability or alleged liability of the Borrower or any Significant Subsidiary for
the costs of cleaning up, removing, remediating or responding to a release of
Hazardous Materials;
7.14. Environmental Compliance.
--------------------------
If the Borrower or any Significant Subsidiary shall receive any letter, notice,
complaint, order, directive, claim or citation alleging that the Borrower or
such Significant Subsidiary is liable for any material cost of cleaning up,
removing, remediating or responding to a release of Hazardous Materials, the
Borrower shall, within the time period permitted by the applicable Environmental
Law or the Governmental Authority responsible for enforcing such Environmental
Law, remove or remedy, or cause the applicable Significant Subsidiary to remove
or remedy, such violation or release or satisfy such liability unless and only
during the period that the applicability of the Environmental Law, the fact of
such violation or liability or what is required to remove or remedy such
violation is being contested by the Borrower or the applicable Significant
Subsidiary by appropriate proceedings diligently conducted and all reserves with
respect thereto as may be required under GAAP, if any, have been made, and no
Liens in connection therewith shall have attached to any property of the
Borrower or the applicable Significant Subsidiary which shall have become
enforceable against creditors of such Person and which individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect;
7.15. Indemnification.
---------------
Subject to and without limiting the generality of Section 11.9 hereof, the
Borrower hereby agrees to indemnify and hold the Agent, the Lenders, and their
respective officers, directors, employees and agents, harmless from and against
any and all claims, losses, penalties, liabilities, damages and documented
out-of-pocket expenses (including assessment and cleanup costs and reasonable
attorneys' fees and disbursements) arising directly or indirectly from, out of
or by reason of (a) the violation of any Environmental Law by the Borrower or
any Subsidiary or with respect to any property owned, operated or leased by the
Borrower or any Subsidiary or (b) the handling, storage, treatment, emission or
disposal of any Hazardous Materials by or on behalf of the Borrower or any
Subsidiary or on or with respect to property owned or leased or operated by the
Borrower or any Subsidiary;
58
7.16. Further Assurances.
--------------------
At the Borrower's cost and expense, upon written request of the Agent, duly
execute and deliver or cause to be duly executed and delivered, to the Agent
such further instruments, documents and certificates and do and cause to be done
such further acts that may be reasonably necessary to carry out more effectively
the provisions and purposes of this Agreement and the other Loan Documents;
7.17. Employee Benefit Plans.
-----------------------
(a) With reasonable promptness, and in any event within thirty
(30) days thereof, give notice to the Agent of (a) the establishment of
any new Pension Plan (which notice shall include a copy of such plan),
(b) the commencement of contributions to any Employee Benefit Plan to
which the Borrower or any of its ERISA Affiliates was not previously
contributing, (c) any material increase in the benefits of any existing
Pension Plan, (d) each funding waiver request filed with respect to any
Employee Benefit Plan and (e) the failure of the Borrower or any ERISA
Affiliate to make a required installment or payment under Section 302
of ERISA or Section 412 of the Code by the due date which, if not made
could reasonably be expected to have a Material Adverse Effect;
(b) Promptly and in any event within fifteen (15) days of
becoming aware of the occurrence or forthcoming occurrence of any (a)
Termination Event or (b) nonexempt "prohibited transaction," as such
term is defined in Section 406 of ERISA or Section 4975 of the Code, in
connection with any Pension Plan or any trust created thereunder,
deliver to the Agent a notice specifying the nature thereof, what
action the Borrower or any ERISA Affiliate has taken, is taking or
proposes to take with respect thereto and, when known, any action taken
or threatened by the Internal Revenue Service, the Department of Labor
or the PBGC with respect thereto; and
(c) With reasonable promptness but in any event within fifteen
(15) days for purposes of clauses (a) and (b) and within sixty (60)
days of the filing of the annual report for purposes of clause (c),
deliver to the Agent copies of (a) any unfavorable determination letter
from the Internal Revenue Service regarding the qualification of an
Employee Benefit Plan under Section 401(a) of the Code, (b) all notices
received by the Borrower or any ERISA Affiliate of the PBGC's intent to
terminate any Pension Plan or to have a trustee appointed to administer
any Pension Plan, (c) each Schedule B (Actuarial Information) to the
annual report (Form 5500 Series) filed by the Borrower or any ERISA
Affiliate with the Internal Revenue Service with respect to each
Pension Plan and (d) all notices received by the Borrower or any ERISA
Affiliate from a Multiemployer Plan sponsor concerning the imposition
or amount of withdrawal liability pursuant to Section 4202 of ERISA.
The Borrower will notify the Agent in writing within five (5) Business
Days of the Borrower or any ERISA Affiliate obtaining knowledge or
reason to know that the Borrower or any ERISA Affiliate has filed or
intends to file a notice of intent to terminate any Pension Plan under
a distress termination within the meaning of Section 4041(c) of ERISA;
59
7.18. Continued Operations.
---------------------
Continue at all times to conduct its business and engage principally in the same
line or lines of business substantially as heretofore conducted;
7.19. New Material Subsidiaries.
-------------------------
Within 30 days of the acquisition or creation of any Material Subsidiary, or
upon any existing Subsidiary becoming a Material Subsidiary, cause to be
delivered to the Agent for the benefit of the Lenders each of the following, as
applicable:
(a) a Subsidiary Guaranty executed by such Material Subsidiary
substantially in the form of Exhibit I; and
(b) an opinion of counsel to such Material Subsidiary dated as
of the date of delivery of the Subsidiary Guaranty and other Loan
Documents provided for in this Section 7.19(a) and addressed to the
Agent and the Lenders, in form and substance reasonably acceptable to
the Agent, which opinion shall include substantially identical opinions
as those delivered to the Agent and the Lenders on the Closing Date
with respect to comparable matters and from comparable jurisdictions
and which opinion may include assumptions and qualifications, all of
similar effect to those contained in the opinions of counsel delivered
pursuant to Section 5.1(a) hereof.
60
ARTICLE VIII
------------
Negative Covenants
------------------
Until the Facility Termination Date, unless the Required Lenders shall
otherwise consent in writing, the Borrower will not, nor will it permit any
Subsidiary or Significant Subsidiary, as applicable, to violate any of the
following provisions:
8.1. Financial Covenants.
--------------------
The Borrower and its Subsidiaries will not:
(a) Consolidated Leverage Ratio. Permit at any time during any
Four-Quarter Period of the Borrower, the Consolidated Leverage Ratio to
be greater than 2.25 to 1.00.
(b) Consolidated Fixed Charge Ratio. Permit at any time during
any Four - Quarter Period of the Borrower the Consolidated Fixed Charge
Ratio to be less than 1.50 to 1.00.
(c) Consolidated Tangible Net Worth. Permit at any time
Consolidated Tangible Net Worth to be less than $375,000,000, such
amount to be increased as at the first day of each fiscal quarter,
beginning with the fiscal quarter ending December 31, 1997, by an
amount equal to (a) fifty percent (50%) of Consolidated Net Income
during the immediately preceding fiscal quarter, plus (b) one hundred
percent (100%) of the Net Proceeds of any Equity Offering consummated
during the immediately preceding fiscal quarter; provided, however, in
no event shall the Consolidated Tangible Net Worth requirement be
decreased as a result of a net loss of the Borrower and its
Subsidiaries (i.e., negative Consolidated Net Income) for any fiscal
quarter. Any increase calculated pursuant hereto shall be determined
based upon financial statements delivered in accordance with Section
7.1(a) hereof; provided, however such increase shall be deemed
effective as of the first day of the fiscal quarter in which such
financial statements are delivered.
(d) Consolidated Liquidity Ratio. Permit at any time during
any Four - Quarter Period of the Borrower the Consolidated Liquidity
Ratio to be less than 1.50 to 1.00.
8.2. Acquisitions.
------------
Neither the Borrower, nor any Subsidiary shall enter into any agreement,
contract, binding commitment or other arrangement providing for any Acquisition
or take any action to solicit the tender of securities or proxies in respect
thereof in order to effect any Acquisition, unless (i) the Person to be (or
whose assets are to be) acquired does not oppose such Acquisition, (ii) no
Default or Event of Default shall have occurred and be continuing either
immediately prior to or immediately after giving effect to such Acquisition,
(iii) if the Cost of Acquisition shall exceed $25,000,000, the Borrower shall
have furnished to the Agent a certificate in the form of Exhibit H prepared on a
historical pro forma basis giving effect to such Acquisition, which certificate
shall demonstrate that no Default or Event of Default would exist immediately
61
after giving effect thereto, and pro forma historical financial statements as of
the end of the most recently completed Fiscal Year of the Borrower and most
recent interim fiscal quarter, if applicable, giving effect to such Acquisition
and (iv) the Cost of Acquisition, in the aggregate with all Costs of Acquisition
during the Four-Quarter Period in which the Acquisition is closed, does not
exceed twenty percent (20%) of Consolidated Tangible Net Worth as at the
beginning of such Four-Quarter Period;
8.3. Liens.
-----
Neither the Borrower nor any Significant Subsidiary shall incur, create or
permit to exist any Lien, charge or other encumbrance of any nature whatsoever
with respect to any property or assets now owned or hereafter acquired by the
Borrower or any Significant Subsidiary, other than the following (collectively
"Permitted Liens"):
(a) Liens existing as of the date hereof and as set forth in
Schedule 6.7;
(b) Liens imposed by law for taxes, assessments or charges of
any Governmental Authority for claims not yet due or which are being
contested in good faith by appropriate proceedings diligently conducted
and with respect to which adequate reserves are being maintained in
accordance with GAAP and which Liens are not yet enforceable;
(c) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law or
created in the ordinary course of business and in existence less than
90 days from the date of creation thereof for amounts not yet due or
which are being contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves are
being maintained in accordance with GAAP and which Liens are not yet
enforceable;
(d) Liens incurred or deposits made in the ordinary course of
business (including, without limitation, surety bonds and appeal bonds)
in connection with workers' compensation, unemployment insurance and
other types of social security benefits or to secure (or to obtain
letters of credit that secure) the performance of tenders, bids,
leases, contracts (other than for the repayment of Indebtedness),
statutory obligations or tax obligations or refunds, and other similar
obligations or arising as a result of progress payments under
government contracts;
(e) easements (including reciprocal easement agreements and
utility agreements), rights-of-way, covenants, consents, reservations,
encroachments, variations and zoning and other restrictions, charges or
encumbrances (whether or not recorded), which do not interfere
materially with the ordinary conduct of the business of the Borrower or
any Significant Subsidiary and which do not materially detract from the
value of the property to which they attach or materially impair the use
thereof to the Borrower or any Significant Subsidiary; and
62
(f) purchase money Liens to secure Indebtedness permitted
under Section 8.4(d) hereof, including any refinancing thereof
permitted under Section 8.4(m) hereof, provided that no such Lien shall
extend to any property other than the assets so purchased;
(g) Liens arising in connection with Capital Leases permitted
under Section 8.4(f) hereof; provided that no such Lien shall extend to
any property other than the assets subject to such Capital Leases;
(h) Liens on the property or assets of a Significant
Subsidiary acquired after the date hereof securing Indebtedness
permitted by Section 8.4(j) hereof, provided that (i) such Liens
existed at the time such corporation became a Subsidiary and were not
created in anticipation thereof, (ii) any such Lien does not attach to
any additional property or assets of such corporation (other than the
proceeds of the property subject to such Lien on the date such
corporation becomes a Subsidiary and after-acquired property of such
corporation on which a Lien had been granted prior to such date) after
the time such corporation becomes a Subsidiary, and (iii) the amount of
Indebtedness secured thereby is not increased;
(i) Liens arising pursuant to one or more orders of
attachment, distraint or similar legal process issued in connection
with one or more court proceedings (which may or may not be related) so
long as the execution or other enforcement thereof is effectively
stayed and the claims secured thereby do not exceed $2,500,000 in the
aggregate and are being contested in good faith by appropriate
proceedings diligently conducted; and
(j) other incidental Liens which do not individually or in the
aggregate materially interfere with the use, occupancy or operation of
any property to which they attach and which secured Indebtedness or
obligations in an aggregate amount not greater than $5,000,000.
8.4. Indebtedness.
-------------
Neither the Borrower nor any Significant Subsidiary shall incur, create, assume
or permit to exist any Indebtedness of the Borrower or any Significant
Subsidiary,howsoever evidenced, except:
(a) Indebtedness existing as of the Closing Date as set forth
in Schedule 6.6; provided, none of the instruments and agreements
evidencing or governing such Indebtedness shall be amended, modified or
supplemented after the Closing Date to change any terms of
subordination, repayment or rights of conversion, put, exchange or
other rights from such terms and rights as in effect on the Closing
Date or to change any terms in a manner not permitted under Section
8.4(m) hereof with respect to any refinancing;
(b) Indebtedness owing to the Agent or any Lender in
connection with this Agreement, any Note or other Loan Document;
63
(c) the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;
(d) Indebtedness not to exceed an aggregate principal
outstanding amount at any time of $15,000,000 incurred to purchase
fixed assets, provided such Indebtedness represents not less than 75%
nor more than 100% of the purchase price or market value, whichever is
less, of such assets as of the date of purchase thereof;
(e) Indebtedness arising from Hedging Obligations not
prohibited under Section 8.14 hereof;
(f) Indebtedness consisting of Capital Leases not to exceed an
aggregate amount outstanding at any time of $5,000,000;
(g) unsecured intercompany Indebtedness of the Borrower or any
Material Subsidiary owing to any non-Guarantor Subsidiary, provided
that such Indebtedness shall be subordinated upon terms substantially
the same as set forth in Exhibit J hereto and, if evidenced by a note
or other instrument, such instrument shall be non-negotiable;
(h) unsecured intercompany Indebtedness of the Borrower or any
Material Subsidiary owing to a Material Subsidiary;
(i) Indebtedness of the Borrower or a Subsidiary hereunder
incurred to fund part of the Cost of Acquisition in connection with an
Acquisition permitted hereunder, provided such Indebtedness is owed to
the selling party in such Acquisition and is evidenced by a promissory
note which is subordinated to the Obligations hereunder on terms
substantially the same as set forth in Exhibit J hereto;
(j) Indebtedness for Borrowed Money of a Person acquired in an
Acquisition permitted under Section 8.2 hereof so long as (i) such
Indebtedness is not incurred in contemplation of such Acquisition, and
(ii) the aggregate principal amount of all such Indebtedness does not
exceed $10,000,000;
(k) Indebtedness in connection with contingent lease
obligations in accordance with Generally Accepted Accounting Principles
applied on a Consistent Basis arising from recourse lease transactions
in an aggregate amount not in excess of $25,000,000;
(l) intercompany Indebtedness of non-Guarantor Subsidiaries
permitted under Section 8.6(e) or (h) hereof;
(m) additional unsecured Indebtedness for Money Borrowed not
otherwise covered by clauses (a) through (k) above, provided that the
aggregate outstanding principal amount of all such other Indebtedness
permitted under this clause (k) shall in no event exceed $5,000,000 at
any time;
64
(n) Indebtedness consisting of short-term overdraft facilities
arising in the ordinary course of business and consistent with past
practice and to the extent repaid within 30 days of incurrence;
(o) Indebtedness of the Borrower consisting of Guaranties of
performance obligations of Subsidiaries entered into in the ordinary
course of business and consistent with past practice of the Borrower;
and
(p) Indebtedness extending the maturity of, or renewing,
refunding or refinancing, in whole or in part, Indebtedness incurred
created, assumed or permitted under clauses (a), (d), (f), (g), (h),
(i), (j), (k), (l) or (m) of this Section 8.4, provided that the terms
of any such extension, renewal, refunding or refinancing Indebtedness
(and of any agreement or instrument entered into in connection
therewith) are no less favorable to the Agent and the Lenders than the
terms of the Indebtedness as in effect prior to such action, and
provided further that (1) the aggregate principal amount of or interest
rate or rates and fees payable on such extended, renewed, refunded or
refinanced Indebtedness shall not be increased by such action, (2) the
group of direct or contingent obligors on such Indebtedness shall not
be expanded as a result of any such action, and (3) immediately before
and immediately after giving effect to any such extension, renewal,
refunding or refinancing, no Default or Event of Default shall have
occurred and be continuing.
8.5. Transfer of Assets; Issuance of Capital Stock.
-----------------------------------------------
(a) Neither the Borrower nor any Significant Subsidiary shall
sell, lease, transfer or otherwise dispose of any of its assets,
including any sale of any capital stock of a Significant Subsidiary (or
any option, warrant or right to acquire such stock), other than (i)
dispositions of inventory, demonstration equipment, or equipment on
rotation in the ordinary course of business, (ii) dispositions of
equipment which, in the aggregate during any Fiscal Year, have a fai
market value or book value, whichever is less, of $10,000,000 or less
and is not replaced by equipment having at least equivalent value,(iii)
dispositions of property that is substantially worn, damaged, obsolete
or, in the judgment of the Borrower, no longer best used or useful in
its business or that of any Significant Subsidiary, iv) transfers of
assets necessary to give effect to merger or consolidation liquidation
or dissolution transactions permitted by Section 8.7 hereof and (v) the
disposition of Eligible Securities in the ordinary course of management
of the investment portfolio of the Borrower and its Significant
Subsidiaries.
(b) The Borrower shall not permit any Significant Subsidiary
to issue any shares of capital stock to any Person other than a
Material Subsidiary or the Borrower.
8.6. Investments.
------------
Neither the Borrower nor any Significant Subsidiary shall purchase, own, invest
in or otherwise acquire, directly or indirectly, any stock or other securities,
or make or permit to exist any interest whatsoever in any other Person or permit
to exist any loans or advances to any Person, except the Borrower and its
Significant Subsidiaries may:
(a) own securities of any Person acquired in an Acquisition
permitted hereunder and de minimis equity interests in any Person;
65
(b) own Eligible Securities;
(c) maintain investments existing as of the date hereof not
otherwise provided for in this Section 8.6 and as set forth in Schedule
6.4 hereof;
(d) create accounts receivable arising and provide trade
credit granted in the ordinary course of business and own any
securities received in satisfaction or partial satisfaction thereof in
connection with accounts of financially troubled Persons to the extent
reasonably necessary in order to prevent or limit loss;
(e) in addition to any Indebtedness permitted under clause (h)
below, make or maintain unsecured intercompany loans, advances and cash
investments by the Borrower or any Significant Subsidiary to or in any
non-Guarantor Subsidiary in an aggregate amount not in excess of
$10,000,000; provided that if the obligations thereunder are evidenced
by a note or other instrument, such instrument shall be non-negotiable;
(f) make and maintain loans and advances between the Borrower
and its Material Subsidiaries and between a Material Subsidiary and any
other Material Subsidiary;
(g) make and maintain cash investments in non-Guarantor
Subsidiaries in an aggregate amount outstanding at any time not in
excess of $10,000,000;
(h) make and maintain non-cash investments in Non-Guarantor
Subsidiaries in the form of sales or transfers of inventory to such
Subsidiaries consistent with past practice and in the ordinary course
of business, whether in the form of accounts receivable or Indebtedness
derived therefrom owing from the Subsidiary;
(i) make and maintain investments in any Person or Persons
engaged in the same or similar line of business as the Borrower, which
is acquired in an Acquisition permitted under Section 8.2 hereof;
(j) make loans and advances to its officers, directors and
employees for any business purpose in an aggregate amount outstanding
at any time not in excess of $750,000;
(k) invest in key man life insurance with respect to its
executive officers; and
(l) make other loans, advances and investments in an aggregate
principal amount at any time outstanding not to exceed $15,000,000.
8.7. Merger or Consolidation.
-----------------------
Neither the Borrower nor any Subsidiary shall
(a)consolidate with or merge into any other Person, or
(b) permit any other Person to merge into it; provided,however
(i) any Subsidiary of the Borrower may merge or transfer all or
substantiallyall of its assets inot or consldate with the Borrower or
66
any Guarantor, (ii) any non-Guarantor Subsidiary may merge or consolidate with
or into any other non-Guarantor Subsidiary and (iii) any other Person may merge
into or consolidate with the Borrower or any wholly-owned Subsidiary and any
Subsidiary may merge into or consolidate with any other Person in order to
consummate an Acquisition permitted by Section 8.2 hereof provided further, that
any resulting or surviving entity shall execute and deliver such agreements and
other documents, including a Subsidiary Guaranty, and take such other action
required under Section 7.19 hereof or as the Agent may reasonably require to
evidence or confirm its express assumption of the obligations and liabilities of
its predecessor entities under the Loan Documents to which such predecessor
entities were party;
8.8. Restricted Payments.
-------------------
Neither the Borrower nor any Subsidiary shall make any Restricted Payment or
apply or set apart any of their assets therefor or agree to do any of the
foregoing;
8.9. Transactions with Affiliates.
-----------------------------
Other than transactions permitted under Sections 8.7 and 8.8, neither the
Borrower nor any Subsidiary shall enter into any transaction after the Closing
Date, including, without limitation, the purchase, sale, lease or exchange of
property, real or personal, or the rendering of any service, with any Affiliate
of the Borrower, except
(a) that such Affiliates may render services to the Borrower or
its Subsidiaries for compensation at the same rates generally paid by
Persons engaged in the same or similar businesses for the same or
similar services,
(b) that the Borrower or any Subsidiary may render services to
such Affiliates for compensation at the same rates generally charged by
the Borrower or such Subsidiary,
(c) in the ordinary course of business and pursuant to the
reasonable requirements of the Borrower's (or any Subsidiary's)
business and upon fair and reasonable terms no less favorable to the
Borrower (or any Subsidiary) than would be obtained in a comparable
arm's-length transaction with a Person not an Affiliate or
(d)transactions described in Section 8.6(g) hereof;
8.10. Compliance with ERISA.
----------------------
Neither the Borrower nor any Subsidiary shall with respect to any Pension Plan,
Employee Benefit Plan or Multiemployer Plan:
(a) permit the occurrence of any Termination Event which would
result in a liability on the part of the Borrower or any ERISA
Affiliate to the PBGC except where such occurrence could not reasonably
be expected to have a Material Adverse Effect; or
(b) permit any accumulated funding deficiency (as defined in
Section 302 of ERISA and Section 412 of the Code) with respect to any
Pension Plan, whether or not waived, except where such occurrence could
not reasonably be expected to have a Material Adverse Effect; or
(c) fail to make any contribution or payment to any
Multiemployer Plan which the Borrower or any ERISA Affiliate may be
required to make under any agreement relating to such Multiemployer
Plan, or any law pertaining thereto; or
67
(d) engage, or permit any Borrower or any ERISA Affiliate to
engage, in any prohibited transaction under Section 406 of ERISA or
Sections 4975 of the Code for which a civil penalty pursuant to Section
502(i) of ERISA or a tax pursuant to Section 4975 of the Code may be
imposed except where such occurrence could not reasonably be expected
to have a Material Adverse Effect; or
(e) permit the establishment of any Employee Benefit Plan
providing post-retirement welfare benefits, or establish or amend any
Employee Benefit Plan which establishment or amendment could result in
any liability to the Borrower or any ERISA Affiliate or increase the
obligation of the Borrower or any ERISA Affiliate to a Multiemployer
Plan except where such liability or increased obligation could not
reasonably be expected to have a Material Adverse Effect; or
(f) fail, or permit the Borrower or any ERISA Affiliate to
fail, to establish, maintain and operate each Employee Benefit Plan in
compliance in all material respects with the provisions of ERISA, the
Code, all applicable Foreign Benefit Laws and all other applicable laws
and the regulations and interpretations thereof except where such
occurrence could not reasonably be expected to have a Material Adverse
Effect;
8.11. Fiscal Year.
------------
Neither the Borrower nor any Subsidiary shall change its Fiscal Year;
8.12. Dissolution, etc.
------------------
Neither the Borrower nor any Significant Subsidiary shall wind up, liquidate or
dissolve (voluntarily or involuntarily) or commence or suffer any proceedings
seeking any such winding up, liquidation or dissolution, except in connection
with a merger or consolidation permitted pursuant to Section 8.7 hereof;
8.13. Limitations on Sales and Leasebacks.
-----------------------------------
Neither the Borrower nor any Significant Subsidiary shall enter into any
arrangement with any Person providing for the leasing by the Borrower or any
Significant Subsidiary of real or personal property, whether now owned or
hereafter acquired in a related transaction or series of related transactions,
which has been or is to be sold or transferred by the Borrower or any
Significant Subsidiary to such Person or to any other Person to whom funds have
been or are to be advanced by such Person on the security of such property or
rental obligations of the Borrower or any Significant Subsidiary (a "Sale and
Leaseback Transaction"); provided however, the Borrower or any Significant
Subsidiary may enter into Sale and Leaseback Transactions to the extent the
aggregate amount of all payments made in connection therewith during any twelve
month period do not exceed $10,000,000;
8.14. Hedging Obligations.
--------------------
Neither the Borrower nor any Significant Subsidiary shall incur any Hedgin
Obligations, or enter into any agreements, arrangements, devices or instruments
relating to Hedging Obligations, for speculative or investment purposes;
8.15. Negative Pledge Clauses.
------------------------
Neither the Borrower nor any Subsidiary shall enter into or cause, suffer or
permit to exist any agreement with any Person other than the Agent and the
Lenders pursuant to this Agreement or any other Loan Documents which prohibits
or limits the ability of any of the Borrower or any Subsidiary to create, incur
68
assume or suffer to exist any Lien upon any of its property, assets or revenues,
whether now owned or hereafter acquired, provided that the Borrower and any
Subsidiary may enter into such an agreement in connection with, and limited to,
property acquired with the proceeds of purchase money Indebtedness permitted
hereunder;
8.16. Change in Accountants.
---------------------
The Borrower shall not change its independent public accountants to any
accounting firm other than an accounting firm of Nationally Recognized Standing;
8.17. Limitations on Certain Restrictive Covenants.
-------------------------------------------------
Neither the Borrower nor any Subsidiary shall enter into, or permit to exist,
with any Person any agreement (other than this Agreement) which prohibits or
limits the ability of any Subsidiary to declare or pay any dividend or make any
loan to or investment in the Borrower or any other owner of such Subsidiary.
8.18. Payment of Indebtedness.
------------------------
The Borrower shall not make any optional redemption of any Indebtedness
outstanding under the Indenture nor deposit any funds with the Trustee (as
defined in the Indenture) pursuant to Section 13.1(b)of the Indenture in order
to effect, directly or indirectly, an optional redemption if
(a) an Event of Default has occurred and is continuing or such
prepayment would create a Default or Event of Default,
(b) there are any Outstandings hereunder or
(c) the sum of cash plus Eligible Securities of the
Borrower is less than $500,000,000.
69
ARTICLE IX
----------
Events of Default and Acceleration
-----------------------------------
9.1. Events of Default.
------------------
If any one or more of the following events (herein called "Events of Default")
shall occur for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court or
any order, rule or regulation of any Governmental Authority), that is to say:
(a) if default shall be made in the due and punctual payment
of the principal or interest of any Loan, Swing Line Loan, or
Reimbursement Obligation, when and as the same shall be due and payable
whether pursuant to any provision of Article II or Article III hereof,
at maturity, by acceleration or otherwise; or
(b) if default shall be made in the due and punctual payment
of any fees or other Obligations payable to NationsBank, any of the
Lenders or the Agent on the date on which the same shall be due and
payable and such default shall continue for a period of five (5)
Business Days after notice of such default is received from the Agent
or any Lender; or
(c) if default shall be made in the performance or observance
of any covenant set forth in Section 7.3, 7.7, 7.11, 7.12, 7.19 or
Article VIII;
(d) if a default shall be made in the performance or
observance of, or shall occur under, any covenant, agreement or
provision contained in this Agreement or the Notes (other than as
described in clauses (a), (b) or (c) above) and such default shall
continue for 30 or more days after the earlier of receipt of notice of
such default by the Authorized Representative from the Agent or any
Lender, or a Responsible Officer of the Borrower becomes aware of such
default, or if a default shall be made in the performance or observance
of, or shall occur under, any covenant, agreement or provision
contained in any of the other Loan Documents (beyond any applicable
grace period, if any, contained therein) or in any instrument or
document evidencing or creating any obligation, guaranty, or Lien in
favor of the Agent or any of the Lenders or delivered to the Agent or
any of the Lenders in connection with or pursuant to this Agreement or
any of the Obligations, or if any Loan Document ceases to be in full
force and effect (other than by reason of any action by the Agent or in
accordance with its terms), or if without the written consent of the
Lenders, this Agreement or any other Loan Document shall be disaffirmed
or shall ter minate, be terminable or be terminated or become void or
unenforceable for any reason whatsoever (other than in accordance with
its terms in the absence of default or by reason of any action by the
Lenders or the Agent); or
(e) if there shall occur (i) a default, which is not waived,
in the payment of any principal, interest, premium or other amount with
respect to any Indebtedness(other than the Loans and other Obligations)
70
of the Borrower or any Subsidiary which Indebtedness is in an amount
not less than $15,000,000 in the aggregate outstanding, or (ii) a
default, which is not waived, in the performance, observance or
fulfillment of any term or covenant contained in any agreement
instrument under or pursuant to which any such Indebtedness may have
been issued, created, assumed, guaranteed or secured by the Borrower or
any Subsidiary, and such default or event of default shall continue for
more than the period of grace, if any, therein specified, or such
default or event of default shall permit the holder of any such
Indebtedness (or any agent or trustee acting on behalf of one or more
holders) to accelerate the maturity thereof; or
(f) if any representation, warranty or other statement of fact
contained in any Loan Document or in any writing, certificate, report
or statement at any time furnished to the Agent or any Lender by or on
behalf of the Borrower or any other Credit Party pursuant to or in
connection with any Loan Document, or otherwise, shall be false or
misleading in any material respect when given; or
(g) if the Borrower or any other Credit Party shall be unable
to pay its debts generally as they become due; file a petition to take
advantage of any insolvency statute; make an assignment for the benefit
of its creditors; commence a proceeding for the appointment of a
receiver, trustee, liquidator or conservator of itself or of the whole
or any substantial part of its property; file a petition or answer
seeking liquidation, reorganization or arrangement or similar relief
under the federal bankruptcy laws or any other applicable law or
statute; or
(h) if a court of competent jurisdiction shall enter an order,
judgment or decree appointing a custodian, receiver, trustee,
liquidator or conservator of the Borrower or any other Credit Party or
of the whole or any substantial part of its properties and such order,
judgment or decree continues unstayed and in effect for a period of
sixty (60) days, or approve a petition filed against the Borrower or
any other Credit Party seeking liquidation, reorganization or
arrangement or similar relief under the federal bankruptcy laws or any
other applicable law or statute of the United States of America or any
state, which petition is not dismissed within sixty (60) days; or if,
under the provisions of any other law for the relief or aid of debtors,
a court of competent jurisdiction shall assume custody or control of
the Borrower or any other Credit Party or of the whole or any
substantial part of its properties, which control is not relinquished
within sixty (60) days; or if there is commenced against the Borrower
or any other Credit Party any proceeding or petition seeking
reorganization, arrangement or similar relief under the federal
bankruptcy laws or any other applicable law or statute of the United
States of America or any state which proceeding or petition remains
undismissed for a period of sixty (60) days; or if the Borrower or any
other Credit Party takes any action to indicate its consent to or
approval of any such proceeding or petition; or
(i)if (i) one or more judgments or orders where the amount not
covered by insurance (or the amount as to which the insurer denies
liability) in excess of $15,000,000 is rendered against the Borrower
71
or any Subsidiary, or (ii) there is any attachment, injunction or
execution against any of the Borrower's or Subsidiaries' properties for
any amount in excess of $15,000,000 in the aggregate; and such
judgment, attachment, injunc tion or execution remains unpaid, unstayed
undischarged, unbonded or undismissed for a period of sixty (60) days;
or
(j) if the Borrower or any Subsidiary shall, other than in the
ordinary course of business (as determined by past practices), suspend
all or any part of its operations material to the conduct of the
business of the Borrower or such Subsidiary for a period of more than
60 days; or
(k) if the Borrower or any Subsidiary shall breach any of the
material terms or conditions of any agreement under which any Hedging
Obligations permitted hereby is created and such breach shall continue
beyond any grace period, if any, relating thereto pursuant to the terms
of such agreement, or if the Borrower or any Subsidiary shall disaffirm
or seek to disaffirm any such agreement or any of its obligations
thereunder; or
(l) if a Change of Control shall occur;
then, and in any such event and at any time thereafter, if such Event of Default
or any other Event of Default shall have not been waived,
(A) either or both of the following actions may be
taken: (i) the Agent, with the consent of the Required Lenders
may, and at the direction of the Required Lenders shall,
declare any obligation of the Lenders, NationsBank and the
Issuing Bank to make further Revolving Loans or Swing Line
Loans or to issue additional Letters of Credit terminated,
whereupon the obligation of each Lender to make further
Revolving Loans and of NationsBank to make Swing Line Loans
and of the Issuing Bank to issue additional Letters of Credit,
hereunder shall terminate immediately, and (ii) the Agent
shall at the direction of the Required Lenders, at their
option, declare by notice to the Borrower any or all of the
Obligations to be immediately due and payable, and the same,
including all interest accrued thereon and all other
obligations of the Borrower to the Agent and the Lenders,
shall forthwith become immediately due and payable without
presentment, demand, protest, notice or other formality of any
kind, all of which are hereby expressly waived, anything
contained herein or in any instrument evidencing the
Obligations to the contrary notwithstanding; provided,
however, that notwithstanding the above, if there shall occur
an Event of Default under clause (g) or (h) above, then the
obligation of the Lenders to make Revolving Loans, and of
NationsBank to make Swing Line Loans and of the Issuing Bank
to issue Letters of Credit hereunder shall automatically
terminate and any and all of the Obligations shall be
immediately due and payable without the necessity of any
action by the Agent or the Required Lenders or notice to or by
the Agent or the Lenders;
72
(B) The Borrower shall, upon demand of the Agent or
the Required Lenders, deposit cash with the Agent in an amount
equal to the amount of any Letter of Credit Outstandings, as
collateral security for the repayment of any future drawings
or payments under such Letters of Credit, and such amounts
shall be held by the Agent pursuant to the terms of the Cash
Collateral Account Agreement; and
(C) the Agent and each of the Lenders shall have all
of the rights and remedies available under the Loan Documents
or under any applicable law.
9.2. Agent to Act.
-------------
In case any one or more Events of Default shalloccur and not have been waived,
the Agent may, and at the direction of the Required Lenders shall, proceed to
protect and enforce their rights or remedies either by suit in equity or by
action at law, or both, whether for the specific performance of any covenant,
agreement or other provision contained herein or in any other Loan Document, or
to enforce the payment of the Obligations or any other legal or equitable right
or remedy.
9.3. Cumulative Rights.
-------------------
No right or remedy herein conferred upon the Lenders or the Agent is intended to
be exclusive of any other rights or remedies contained herein or in any other
Loan Document, and every such right or remedy shall be cumulative and shall be
in addition to every other such right or remedy contained herein and therein or
now or hereafter existing at law or in equity or by statute, or otherwise.
9.4. No Waiver.
----------
No course of dealing between the Borrower and any Lender or the Agent or any
failure or delay on the part of any Lender or the Agent in exercising any rights
or remedies under any Loan Document or otherwise available to it shall operate
as a waiver of any rights or remedies and no single or partial exercise of any
rights or remedies shall operate as a waiver or preclude the exercise of any
other rights or remedies hereunder or of the same right or remedy on a future
occasion.
9.5. Allocation of Proceeds.
-----------------------
If an Event of Default has occurred and not been waived, and the maturity of the
Notes has been accelerated pursuant to Article XI hereof, all payments received
by the Agent hereunder, in respect of any principal of or interest on the
Obligations or any other amounts payable by the Borrower hereunder, shall be
applied by the Agent in the following order:
(a) amounts due to the Lenders pursuant to Sections 2.10, 3.3,
3.4 and 11.5;
(b) amounts due to the Agent pursuant to Section 10.9;
(c) payments of interest on Loans, Swing Line Loans and
Reimbursement Obligations, to be applied for the ratable benefit of the
Lenders;
(d) payments of principal of Loans, Swing Line Loans and
Reimbursement Obligations, to be applied for the ratable benefit of the
Lenders;
73
(e) payments of cash amounts to the Agent in respect of Letter
of Credit Outstandings pursuant to Section 9.1(l)(B);
(f) amounts due to the Lenders pursuant to Sections 3.2(g),
7.15 and 11.9;
(g) payments of all other amounts due to the Lenders under any
of the Loan Documents, if any, to be applied for the ratable benefit of
the Lenders;
(h) amounts due to any of the Lenders in respect of
Obligations consisting of liabilities under any Swap Agreement with any
of the Lenders on a pro rata basis according to the amounts owed; and
(i) any surplus remaining after application as provided for
herein, to the Borrower or otherwise as may be required by applicable
law.
74
ARTICLE X
---------
The Agent
---------
10.1. Appointment, Powers, and Immunities.
-------------------------------------
Each Lender hereby irrevocably appoints and authorizes the Agent to act as its
agent under this Agreement and the other Loan Documents with such powers and
discretion as are specifically delegated to the Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. The Agent (which term as used in this sentence
and in Section 10.5 hereof and the first sentence of Section 10.6 hereof shall
include its affiliates and its own and its affiliates' officers, directors
employees, and agents):
(a) shall not have any duties or responsibilities except those
expressly set forth in this Agreement and shall not be a trustee or
fiduciary for any Lender;
(b) shall not be responsible to the Lenders for any recital,
statement, representation, or warranty (whether written or oral) made
in or in connection with any Loan Document or any certificate or other
document referred to or provided for in, or received by any of them
under, any Loan Document, or for the value, validity, effectiveness,
genuineness, enforceability, or sufficiency of any Loan Document, or
any other document referred to or provided for therein or for any
failure by any Credit Party or any other Person to perform any of its
obligations thereunder;
(c) shall not be responsible for or have any duty to
ascertain, inquire into, or verify the performance or observance of any
covenants or agreements by any Credit Party or the satisfaction of any
condition or to inspect the property (including the books and records)
of any Credit Party or any of its Subsidiaries or affiliates;
(d) shall not be required to initiate or conduct any
litigation or collection proceedings under any Loan Document; and
(e) shall not be responsible for any action taken or omitted
to be taken by it under or in connection with any Loan Document, except
for its own gross negligence or willful misconduct.
The Agent may employ agents and attorneys-in-fact and shall not be responsible
for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care.
10.2. Reliance by Agent.
-----------------
The Agent shall be entitled to rely upon any certification, notice, instrument,
writing, or other communication (including, without limitation, any thereof by
telephone or telefacsimile) believed by it to be genuine and correct and to have
been signed, sent or made by or on behalf of the proper Person or Persons, and
upon advice and statements of legal counsel (including counsel for any Credit
Party), independent accountants, and other experts selected by the Agent. The
Agent may deem and treat the payee of any Note as the holder thereof for all
75
purposes hereof unless and until the Agent receives and accepts an Assignment
and Acceptance executed in accordance with Section 11.1 hereof. As to any
matters not expressly provided for by this Agreement, the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required Lenders, and such
instructions shall be binding on all of the Lenders; provided, however, that the
Agent shall not be required to take any action that exposes the Agent to
personal liability or that is contrary to any Loan Document or applicable law or
unless it shall first be indemnified to its satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking any such action.
10.3. Defaults.
--------
The Agent shall not be deemed to have knowledge or notice of the occurrence of a
Default or Event of Default unless the Agent has received written notice from a
Lender or the Borrower specifying such Default or Event of Default and stating
that such notice is a "Notice of Default". In the event that the Agent receives
such a notice of the occurrence of a Default or Event of Default, the Agent
shall give prompt notice thereof to the Lenders. The Agent shall (subject to
Section 10.2 hereof) take such action with respect to such Default or Event of
Default as shall reasonably be directed by the Required Lenders, provided that
unless and until the Agent shall have received such directions, 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 in the best interest of the Lenders.
10.4. Rights as Lender.
-----------------
With respect to its Revolving Credit Commitment and the Loans made by it,
NationsBank (and any successor acting as Agent) in its capacity as a Lender
hereunder shall have the same rights and powers hereunder as any other Lender
and may exercise the same as though it were not acting as the Agent, and the
term "Lender" or "Lenders" shall, unless the context otherwise indicates,
include the Agent in its individual capacity. NationsBank (and any successor
acting as Agent) and its affiliates may (without having to account therefor to
any Lender) accept deposits from, lend money to, make investments in, provide
services to, and generally engage in any kind of lending, trust, or other
business with any Credit Party or any of its Subsidiaries or affiliates as if it
were not acting as Agent, and NationsBank (and any successor acting as Agent)
and its affiliates may accept fees and other consideration from any Credit Party
or any of its Subsidiaries or affiliates for services in connection with this
Agreement or otherwise without having to account for the same to the Lenders.
10.5. Indemnification.
----------------
The Lenders agree to indemnify the Agent (to the extent not reimbursed under
Section 11.9 hereof, but without limiting the obligations of the Borrower under
such Section) ratably in accordance with their respective Applicable Commitment
Percentages, for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including attorneys'
fees), or disbursements of any kind and nature whatsoever that may be imposed
on, incurred by or asserted against the Agent (including by any Lender) in any
way relating to or arising out of any Loan Document or the transactions
contemplated thereby or any action taken or omitted by the Agent under any Loan
Document; provided that no Lender shall be liable for any of the foregoing to
the extent they arise from the gross negligence or willful
76
misconduct of the Person to be indemnified. Without limitation of the foregoing,
each Lender agrees to reimburse the Agent promptly upon demand for its ratable
share of any costs or expenses payable by the Borrower under Section 11.5, to
the extent that the Agent is not promptly reimbursed for such costs and expenses
by the Borrower. The agreements contained in this Section 10.5 shall survive
payment in full of the Loans and all other amounts payable under this Agreement.
10.6. Non-Reliance on Agent and Other Lenders.
---------------------------------------
Each Lender agrees that it has, independently and without reliance on the Agent
or any other Lender, and based on such documents and information as it has
deemed appropriate, made its own credit analysis of the Credit Parties and their
Subsidiaries and decision to enter into this Agreement and that it will,
independently and without reliance upon the Agent or any other Lender, and based
on such documents and information as it shall deem appropriate at the time
continue to make its own analysis and decisions in taking or not taking action
under the Loan Documents. Except for notices, reports, and other documents and
information expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the affairs, financial
condition, or business of any Credit Party or any of its Subsidiaries or
affiliates that may come into the possession of the Agent or any of its
affiliates.
10.7. Resignation of Agent.
---------------------
The Agent may resign at any time by giving notice thereof to the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Agent who must be reasonably acceptable to the Borrower.
If no successor Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within thirty (30) days after the retiring
Agent's giving of notice of resignation, then the retiring Agent may, on behalf
of the Lenders, appoint a successor Agent which shall be a commercial bank
organized under the laws of the United States of America having combined capital
and surplus of at least $500,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor, such successor shall thereupon succeed to and
become vested with all the rights, powers, discretion, privileges, and duties of
the retiring Agent, and the retiring Agent shall be discharged from its duties
and obligations hereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article X hereof shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Agent.
10.8. Sharing of Payments, etc.
-------------------------
Each Lender agrees that if it shall, through the exercise of a right of banker's
lien, set-off, counterclaim or otherwise, obtain payment with respect to its
Obligations (other than pursuant to Article IV hereof) which results in its
receiving more than its pro rata share of the aggregate payments with respect to
all of the Obligations (other than any payment expressly provided hereunder to
be distributed on other than a pro rata basis and payments pursuant to Article
IV hereof), then
(a) such Lender shall be deemed to have simultaneously
purchased from the other Lenders a share in their Obligations so that
the amount of the Obligations held by each of the Lenders shall be pro rata and
(b) such other adjustments shall be made from time to time as
shall be equitable to insure that the Lenders share such payments
ratably;
provided, however, that for purposes of this Section 10.8 the term "pro rata"
77
shall be determined with respect to the Revolving Credit Commitment of each
Lender to the Total Revolving Credit Commitments after subtraction in each case
of amounts, if any, by which any such Lender has not funded its share of the
outstanding Loans and Obligations. If all or any portion of any such excess
payment is thereafter recovered from the Lender which received the same, the
purchase provided in this Section 10.8 shall be rescinded to the extent of such
recovery, without interest. The Borrower expressly consents to the foregoing
arrangements and agrees that each Lender so purchasing a portion of the other
Lenders' Obligations may exercise all rights of payment (including, without
limitation, all rights of set-off, banker's lien or counterclaim) with respect
to such portion as fully as if such Lender were the direct holder of such
portion.
10.9. Fees.
----
The Borrower agrees to pay to the Agent, for its individual account, an annual
Agent's fee as agreed to by the Borrower and Agent pursuant to that certain fee
letter dated July 2, 1997 between the Borrower and the Agent, as it may be
amended prior to the Closing Date.
78
ARTICLE XI
----------
Miscellaneous
-------------
11.1. Assignments and Participations.
-------------------------------
(a) Each Lender may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Loans, its Note
and its Revolving Credit Commitment); provided, however, that
(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender
or an assignment of all of a Lender's rights and obligations under
this Agreement, any such partial assignment shall be in an amount
at least equal to $5,000,000;
(iii) each such assignment by a Lender shall be of a
constant, and not varying, percentage of all of its rights and
obligations under this Agreement and the Note; and
(iv) the parties to such assignment shallexecute and
deliver to the Agent for its acceptance an Assignment and
Acceptance in the form of Exhibit B hereto, together with any Note
subject to such assignment and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the
extent of such assignment, have the obligations, rights, and benefits
of a Lender hereunder and the assigning Lender shall, to the extent of
such assignment, relinquish its rights (other than rights under
Sections 3.2(g), 4.1, 4.6, 7.15, 11.5 and 11.9 of the Credit Agreement
which shall survive any such assignment) and be released from its
obligations under this Agreement. Upon the consummation of any
assignment pursuant to this Section, the assignor, the Agent and the
Borrower shall make appropriate arrangements so that, if required, new
Notes are issued to the assignor and the assignee. If the assignee is
not incorporated under the laws of the United States of America or a
state thereof, it shall deliver to the Borrower and the Agent
certification as to exemption from deduction or withholding of Taxes in
accordance with Section 4.6 hereof.
(b) The Agent shall maintain at its address referred to in
Section 11.2 hereof a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Revolving Credit Commitment of,
and principal amount of the Loans owing to, each Lender from time to
time (the "Register"). The entries in the Register shall be conclusive
and binding for all purposes, absent manifest error, and the Borrower,
the Agent and the Lenders may treat each Person whose name is recorded
in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
79
(c) Upon its receipt of an Assignment and Acceptance executed
by the parties thereto, together with any Note subject to such
assignment and payment of the processing fee, the Agent shall, if such
Assignment and Acceptance has been completed and is in substantially
the form of Exhibit B hereto, (i) accept such Assignment and Acceptance
(ii) record the information contained therein in the Register and (iii)
give prompt notice thereof to the parties thereto.
(d) Each Lender may sell participations to one or more Persons
in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Revolving Credit Commitment and its
Loans); provided, however, that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of
such obligations, (iii) the participant shall be entitled to the
benefit of the yield protection provisions contained in Article IV and
the right of set-off contained in Section 11.3 hereof provided, however
that no participant shall be entitled to receive any greater amount
than the transferor Lender would have been entitled to receive in
respect of the participation effected by such transfer had no
participation occurred, and (iv) the Borrower shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrower
relating to its Loans and its Note and to approve any amendment,
modification, or waiver of any provision of this Agreement (other than
amendments, modifications, or waivers decreasing fees or the amount of
principal of or the rate at which interest is payable on such Loans or
Notes, extending any scheduled principal payment date or date fixed for
the payment of interest on or fees with espect to such Loans or Notes,
or extending its Revolving Credit Commitment).
(e) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time assign and pledge all or any
portion of its Loans and its Notes to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating
Circular issued by such Federal Reserve Bank. No such assignment shall
release the assigning Lender from its obligations hereunder.
(f) Any Lender may furnish any information concerning the
Borrower or any of its Subsidiaries in the possession of such Lender
from time to time to assignees and participants.
11.2. Notices.
--------
Any notice (other than notice of a Default or Event of Default) shall be
conclusively deemed to have been received by any party hereto and be effective
(i) on the day on which delivered (including hand delivery by commercial courier
service) to such party (against receipt therefor), (ii) on the date of receipt
at such telefacsimile number as may from time to time be specified by such party
in written notice to the other parties hereto, or otherwise received, in the
case of notice by telefacsimile (where the receipt of such message is verified
by return), or (iii) on the fifth Business Day after the day on which mailed, if
sent prepaid by certified or registered mail, return receipt requested, in each
case delivered, transmitted or mailed, as the case may be, to the address or
telefacsimile number, as appropriate, set forth below or such other address or
number as such party shall specify by notice hereunder; provided, however, that
notice of a Default or event of Default herunder shall
80
only be effective if delivered pursuant to subsection (i) or (iii) of this
Section 11.2:
(a) if to the Borrower or any other Credit Party:
Data General Corporation
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Treasurer (Mr. Xxxxxx XxXxxxx)
Telephone:(000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to (in the case of notice of a Default or
an Event of Default only):
Data General Corporation
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: General Counsel, Law Department
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
(b) if to the Agent:
NationsBank of Texas, National Association
TX1-492-14-11
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telephone:(000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to:
NationsBank of Texas, National Association
TX1-492-67-01
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxxx Xxxx
Telephone:(000) 000-0000
Telefacsimile: (000) 000-0000
81
(c) if to the Lenders:
At the addresses set forth on the signature pages
hereof and on the signature page of each Assignment and
Acceptance;
(d) if to any other Credit Party, at the address set forth on
the signature page of the Subsidiary Guaranty executed by such Credit
Party.
11.3. Right of Set-off; Adjustments.
-----------------------------
Upon the occurrence and during the continuance of any Event of Default, each
Lender (and each of its affiliates) is hereby authorized at any time and from
time to time, 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 and other indebtedness at any time owing by such Lender (or any of
its affiliates) to or for the credit or the account of the Borrower against any
and all of the obligations of the Borrower now or hereafter existing under this
Agreement and the Note held by such Lender, irrespective of whether such Lender
shall have made any demand under this Agreement or such Note and although such
obligations may be unmatured. Each Lender agrees promptly to notify the Borrower
after any such set-off and application made by such Lender; provided, however,
that the failure to give such notice shall not affect the validity of such
set-off and application. The rights of each Lender under this Section 11.3 are
in addition to other rights and remedies (including, without limitation, other
rights of set-off) that such Lender may have.
11.4. Survival.
---------
All covenants, agreements, representations and warranties made herein shall
survive the making by the Lenders of the Loans and the issuance of the Letters
of Credit and the execution and delivery to the Lenders of this Agreement and
the Notes and shall continue in full force and effect until the Facility
Termination Date unless otherwise provided herein. Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and permitted assigns of such party and all covenants,
provisions and agreements by or on behalf of the Borrower which are contained in
the Loan Documents shall inure to the benefit of the successors and permitted
assigns of the Lenders or any of them.
11.5. Expenses.
---------
The Borrower agrees to pay on demand all reasonable, documented out-of-pocket
costs and expenses of the Agent incurred in connection with the syndication,
preparation, execution, delivery, administration, modification, and amendment of
this Agreement, the other Loan Documents, and the other documents to be
delivered hereunder, including, without limitation, the reasonable fees and
expenses of special counsel for the Agent with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under the Loan
Documents. The Borrower further agrees to pay on demand all reasonable,
documented out-of-pocket costs and expenses of the Agent and the Lenders, if any
(including, without limitation, reasonable attorneys' fees and expenses and the
cost of internal counsel of each Lender), in connection with the enforcement
(whether through negotiations, legal proceedings, or otherwise) of the Loan
Documents and the other documents to be delivered hereunder. All of the
foregoing costs and expenses will be paid by the Borrower to the Agent except to
the extent such cost, liability or expense is
82
found in a judgment by a court of competent jurisdiction to have resulted from
the gross negligence or willful misconduct of the party claiming reimbursement.
11.6. Amendments and Waivers.
------------------------
Any provision of this Agreement or any other Loan Document may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed by
the Borrower and the Required Lenders (and, if Article X or the rights or duties
of the Agent are affected thereby, by the Agent); provided that no such
amendment or waiver shall, unless signed by all the Lenders, (i) increase the
Revolving Credit Commitments hereunder, (ii) reduce the principal of or rate of
interest on any Loan or any fees or other amounts payable hereunder, (iii)
postpone any date fixed for the payment of any scheduled installment of
principal of or interest on any Loan or any fees or other amounts payable
hereunder or for termination of any Loan, (iv) change the percentage of the
Revolving Credit Commitments or of the unpaid principal amount of the Notes, or
change the number of Lenders which shall be required for the Lenders or any of
them to take any action under this Section 11.6 or any other provision of this
Agreement, (v) release any Guarantor or (vi) change the provisions of this
Section 11.6; and provided, further, that no such amendment or waiver that
affects the rights, privileges or obligations of NationsBank as provider of
Swing Line Loans, shall be effective unless signed in writing by NationsBank and
that no such amendment or waiver that affects the rights, privileges or
obligations of the Issuing Bank as issuer of Letters of Credit, shall be
effective unless signed in writing by the Issuing Bank;
Notwithstanding any provision of the other Loan Documents to the contrary,
solely as between the Agent and the Lenders, execution by the Agent shall not be
deemed conclusive evidence that the Agent has obtained the written consent of
the Required Lenders. No notice to or demand on the Borrower in any case shall
entitle the Borrower to any other or further notice or demand in similar or
other circumstances, except as otherwise expressly provided herein. No delay or
omission on any Lender's or the Agent's part in exercising any right, remedy or
option shall operate as a waiver of such or any other right, remedy or option or
of any Default or Event of Default.
11.7. Counterparts.
-------------
This Agreement may be executed in any number of counterparts, each of which when
so executed and delivered shall be deemed an original, and it shall not be
necessary in making proof of this Agreement to produce or account for more than
one such fully - executed counterpart.
11.8. Termination.
------------
The termination of this Agreement shall not affect any rights of the Borrower,
the Lenders or the Agent or any obligation of the Borrower, the Lenders or the
Agent, arising prior to the effective date of such termination. The rights
granted to the Agent for the benefit of the Lenders under the Loan Documents
shall continue in full force and effect, notwith standing the termination of
this Agreement, until the Facility Termination Date shall have occurred (other
than with respect to Sections 3.2(g), 7.15 and 11.9 hereof which shall survive
any such termination). All representations, warranties, covenants, waivers and
agreements contained herein shall survive termination hereof until the Facility
Termination Date unless otherwise provided herein. Notwithstanding the
foregoing, if after receipt of any payment of all or any part of the
83
Obligations, any Lender is for any reason compelled to surrender such payment to
any Person because such payment is determined to be void or voidable as a
preference, impermissible setoff, a diversion of trust funds or for any other
reason, this Agreement shall continue in full force and the Borrower shall be
liable to, and shall indemnify and hold the Agent or such Lender harmless for,
the amount of such payment surrendered until the Agent or such Lender shall have
been finally and irrevocably paid in full. The provisions of the foregoing
sentence shall be and remain effective notwithstanding any contrary action which
may have been taken by the Agent or the Lenders in reliance upon such payment,
and any such contrary action so taken shall be without prejudice to the Agent or
the Lenders' rights under this Agreement and shall be deemed to have been
conditioned upon such payment having become final and irrevocable.
11.9. Indemnification; Limitation of Liability.
-----------------------------------------
(a) The Borrower agrees to indemnify and hold harmless the
Agent and each Lender and each of their affiliates and their respective
officers directors, employees, agents, and advisors (each, an
"Indemnified Party") from and against any and all claims, damages,
losses, liabilities, costs, and expenses (including, without
limitation, reasonable attorneys' fees and disbursements) ("Indemnified
Liabilities") incurred by or awarded against any Indemnified Party, in
each case arising out of or in connection with or by reason of
(including, without limitation, in connection with any investigation,
litigation, or proceeding or preparation of defense in connection
therewith) the Loan Documents, any of the transactions contemplated
herein or the actual or proposed use of the proceeds of the Loans,
except to the extent such Indemnified Liability is found in a final,
non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful
misconduct or to the extent relating to actions or proceedings between
or among the Indemnified Parties and the Lenders not arising from any
action or inaction of the Borrower or any Credit Party. In the case of
an investigation, litigation or other proceeding to which the indemnity
in this Section 11.9 applies, such indemnity shall be effective whether
or not such investigation, litigation or proceeding is brought by the
Borrower, its directors, shareholders or creditors or an Indemnified
Party or any other Person or any Indemnified Party is otherwise a party
thereto and whether or not the transactions contemplated hereby are
consummated. If and to the extent that the foregoing undertaking may be
unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. This
Section 11.9 supersedes any prior agreements of the parties as to
indemnification or limits on liability.
(b) If a claim is to be made by a party entitled to
indemnification under this Section 11.9, Section 3.2(g) or Section 7.15
hereof against the Borrower, the applicable Indemnified Party shall
give written notice to the Borrower promptly after such Indemnified
Party receives actual notice of any claim, action, suit, loss, cost,
liability, damage or expense incurred or instituted for which the
indemnification is sought. If requested by the Borrower in writing, and
so long as no Default or Event of Default shall have occurred and be
continuing, such Indemnified Party shall contest at the expense of the
Borrower the validity, applicability and/or amount of such suit,
action, or cause of action to the extent such contest may be conducted
in good faith on legally supportable grounds. If any lawsuit or
enforcement action is filed against any Indemnified Party, written
notice thereof shall be given to the Borrower as soon as practicable
(and in any event within 20 days after the service of the citation or
summons. Notwithstanding the foregoing, the failure so
84
to notify the Borrower as provided in this section will relieve the
Borrower from liability hereunder only if and to the extent that such
failure results in the forfeiture by the Borrower of any substantive
rights or defenses or results in demonstrable monetary harm to the
Borrower (but such relief from liability shall only be the extent of
such demonstrable monetary harm). The applicable Indemnified Party
shall control the defense and investigation of such lawsuit o action
and shall employ and engage counsel of its own choice to handle and
defend the same, at the Borrower's cost, risk and expense; provided,
however, that the Borrower may, at its own cost participate in the
investigation, trial and defense of such lawsuit or action and any
appeal arising therefrom and the Indemnified Party shall provide
reasonable cooperation with any such participation to the extent
determined, in such Indemnified Party's sole judgement, not to be
detrimental to the interests and rights of such Indemnified Party. If
the Borrower has acknowledged in writing to any Indemnified Party its
obligation to indemnify hereunder (including during the twenty (20) day
notice period described below), such Indemnified Party, so long as no
Default or Event of Default shall have occurred and be continuing,
shall not settle such lawsuit or enforcement action without the prior
written consent of the Borrower and, if the Borrower has not so
acknowledged its obligation, such Indemnified Party shall not settle
such lawsuit or enforcement action without giving twenty (20) days'
prior written notice of such settlement and its terms to the Borrower.
(c) The Borrower agrees that no Indemnified Party shall have
anyliability (whether direct or indirect, in contract or tort or
otherwise) to it, any of its Subsidiaries, any Guarantor, or any
security holders or creditors thereof arising out of, related to or in
connection with the transactions contemplated herein, except to the
extent that such liability is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct; provided,
however, in no event shall any Indemnified Party be liable for
punitive, consequential, indirect or special damages, as opposed to
direct damages.
(d) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the
Borrower contained in Section 11.9, Section 3.2(g) and Section 7.15
shall survive the payment in full of the Obligations payable under this
Agreement, the occurrence of the Facility Termination Date and the
expiration or termination of this Agreement.
11.10. Severability.
-------------
If any provision of this Agreement or the other Loan Documents shall be
determined to be illegal or invalid as to one or more of the parties hereto,
then such provision shall remain in effect with respect to all parties, if any,
as to whom such provision is neither illegal nor invalid, and in any event all
other provisions hereof shall remain effective and binding on the parties hereto
11.11. Entire Agreement.
-----------------
This Agreement, together with the other Loan Documents, constitutes the entire
agreement among the parties with respect to the subject matter hereof and
85
supersedes all previous proposals, negotiations, representations and other
communications between or among the parties, both oral and written, with respect
thereto.
11.12. Agreement Controls.
------------------
In the event that any term of any of the Loan Documents other than this
Agreement conflicts with any express term of this Agreement, the terms and
provisions of this Agreement shall control to the extent of such conflict.
11.13. Usury Savings Clause.
-----------------------
Notwithstanding any other provision herein, the aggregate interest rate charged
under any of the Notes, including all charges or fees in connection therewith
deemed in the nature of interest under applicable law shall not exceed the
Highest Lawful Rate (as such term is defined below). If the rate of interest
(determined without regard to the preceding sentence) under this Agreement at
any time exceeds the Highest Lawful Rate (as defined below), the utstanding
amount of the Loans made hereunder shall bear interest at the Highest Lawful
Rate until the total amount of interest due hereunder equals the amount of
interest which would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect. In addition, if when
the Loans made hereunder are repaid in full the total interest due hereunder
(taking into account the increase provided for above) is less than the total
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect, then to
the extent permitted by law, the Borrower shall pay to the Agent an amount equal
to the difference between the amount of interest paid and the amount of interest
which would have been paid if the Highest Lawful Rate had at all times been in
effect. Notwithstanding the foregoing, it is the intention of the Lenders and
the Borrower to conform strictly to any applicable usury laws. Accordingly, if
any Lender contracts for,charges, or receives any consideration which
constitutes interest in excess of the Highest Lawful Rate, then any such excess
shall be cancelled automatically and, if previously paid, shall at such Lender's
option be applied to the outstanding amount of the Loans made hereunder or be
refunded to the Borrower. As used in this paragraph, the term "Highest Lawful
Rate" means the maximum lawful interest rate, if any, tha at any time or from
time to time may be contracted for, charged, or received under the laws
applicable to such Lender which are presently in effect or, to the extent
allowed by law, under such applicable laws which may hereafter be in effect and
which allow a higher maximum nonusurious interest rate than applicable laws now
allow.
11.14. Governing Law; Waiver of Jury Trial.
-----------------------------------
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED,
IN SUCH STATE.
(b) THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND
CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE
INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX
XXXX, XXXXX XX XXX XXXX, XXXXXX XXXXXX OF AMERICA AND, BY THE
86
EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER EXPRESSLY WAIVES
ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE
IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY
SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND THE BORROWER
HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) THE BORROWER AGREES THAT SERVICE OF PROCESS MAY BE MADE BY
PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR
CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF THE BORROWER
PROVIDED IN SECTION 11.2, OR BY ANY OTHER METHOD OF SERVICE PROVIDED
FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NEW YORK.
(d) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS OR REMEDIES UNDER OR RELATED TO ANY LOAN DOCUMENT OR ANY
AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN
THE FUTURE BE DELIVERED IN CONNECTION THEREWITH, THE BORROWER, THE
AGENT AND THE LENDERS HEREBY AGREE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE
TO TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING.
11.15. Status of Debt.
--------------
EACH PARTY HERETO AGREES THAT THE REVOLVING CREDIT FACILITY, THE LETTER OF
CREDIT FACILITY, ALL SWING LINE LOANS AND ALL OUTSTANDINGS ARE HEREBY
SPECIFICALLY DESIGNATED AS "DESIGNATED SENIOR INDEBTEDNESS" AND AS "SENIOR
INDEBTEDNESS" FOR ALL PURPOSES OF THE INDENTURE AND ARE TO BE AFFORDED ALL
RIGHTS OF, AND TERMS APPLICABLE TO, DESIGNATED SENIOR INDEBTEDNESS AND SENIOR
INDEBTEDNESS UNDER THE TERMS OF THE INDENTURE, INCLUDING, WITHOUT LIMITATION,
SUBORDINATION OF THE NOTES (AS DEFINED IN THE INDENTURE) PURSUANT TO ARTICLE IV
OF THE INDENTURE.
11.16. Existing Letters of Credit.
--------------------------
Each party hereto agrees that the Existing Letters of Credit shall be deemed
Letters of Credit issued and outstanding under the terms of this Agreement.
87
[Signatures on following pages]
88
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be made, executed and delivered by their duly authorized officers as of the day
and year first above written.
DATA GENERAL CORPORATION
By:__/s/ Xxxxxx X. McBride_________________
Name:____Robert C. McBride_________________
Title:__Vice President and Treasurer_______
NATIONSBANK OF TEXAS, NATIONAL
ASSOCIATION, as Agent for the Lenders
By___/s/ Yousuf Omar_______________________
Name:____Yousuf Omar_______________________
Title:___Senior Vice President_____________
Signature Page 1 of 7
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION
By:___/s/ Yousuf Omar______________________
Name:_____Yousuf Omar______________________
Title:____Senior Vice President____________
Lending Office:
NationsBank of Texas, National Association
000 Xxxx Xxxxxx
XX0-000-00-00
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
Wire Transfer Instructions:
NationsBank of Texas, National Association
ABA# _________________________________
Account No.:__________________________
Reference: Data General Corporation
Attention: Corporate Loans Funds Transfer
Signature Page 2 of 7
THE BANK OF NEW YORK
By:___/s/ Xxxxxx Keith_____________________
Name:_____Andrew Keith_____________________
Title:____A.V.P.___________________________
Lending Office:
The Bank of New York
Corporate Banking, N/E Division
0 Xxxx Xxxxxx 00xx Xx
Xxx Xxxx, Xxx Xxxx 00000
====================================
Attention:__Andrew Keith___________________
Telephone:_____(000) 000-0000______________
Telefacsimile:_(000) 000-0000______________
Wire Transfer Instructions:
The Bank of New York
ABA#_________________________________
Account No.:_________________________
Reference:___________________________
Attention:__Lorna O. Alleyne_______________
Signature Page 3 of 7
FLEET NATIONAL BANK
By:__/s/ Xxxxxx X. Davies__________________
Name:____Thomas W. Davies__________________
Title:___Senior Vice President_____________
Lending Office:
Fleet National Bank
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
=====================================
Attention:_____Thomas W. Davies____________
Telephone:_____(000) 000-0000______________
Telefacsimile:_(000) 000-0000______________
Wire Transfer Instructions:
Fleet National Bank
ABA#_________________________________
Account No.:_________________________
Reference:__Data General Corporation_______
Attention:___________________________
Signature Page 4 of 0
XXX XXXX XX XXXX XXXXXX
By:____/s/ T.M. Pitcher____________________
Name:______T.M. Pitcher____________________
Title:_____Authorized Signatory____________
Lending Office:
The Bank of Nova Scotia
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
Wire Transfer Instructions:
The Bank of Nova Scotia-Atlanta Agency
ABA#
Account No.:
Reference: Boston Loan Servicing
Attention: Xxxxxx Xxxxxxxxxx
Signature Page 5 of 7
CREDIT LYONNAIS NEW YORK BRANCH
By:___/s/ Alain Papiasse___________________
Name:_____Alain Papiasse___________________
Title:__Executive Vice President___________
Lending Office:
Credit Lyonnais New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
=====================================
Attention:____Anthony Muller_______________
Telephone:_____(000) 000-0000______________
Telefacsimile:_(000) 000-0000______________
Wire Transfer Instructions:
Credit Lyonnais New York
ABA#_________________________________
Account No.:_________________________
Reference:Client name+description of funds
Attention:Loan Servicing___________________
Signature Page 6 of 7
US TRUST
By:__/s/ Xxxxxx X. Macina__________________
Name:____Thomas F. Macina__________________
Title:___Vice President____________________
Lending Office:
-------------------------------------
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxxxx
Telephone: (000) 000-0000
Telefacsimile:(000) 000-0000
Wire Transfer Instructions:
-------------------------------------
ABA# ________________________________
Account No.:_________________________
Reference: Data General Corporation
Attention: Commercial Loan Operations
Signature Page 7 of 7
EXHIBIT A
----------
Applicable Commitment Percentages
---------------------------------
Commitment
Lender Percentage Amount
------------------------------ -------------- ------------
NationsBank of Texas, National
Association 22.7272727272% $ 25,000,000
The Bank of New York 18.1818181818% $ 20,000,000
Fleet National Bank 18.1818181818% $ 20,000,000
The Bank of Nova Scotia 13.0000000000% $ 15,000,000
Credit Lyonnais New York Branch 13.6363636363% $ 15,000,000
US Trust 13.6363636363% $ 15,000,000
TOTAL: $110,000,000
A-1
EXHIBIT B
---------
Form of Assignment and Acceptance
---------------------------------
Reference is made to the Credit Agreement dated as of September 30,
1997 (the "Credit Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Terms defined in the Credit Agreement are used herein with the same
meaning.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee, WITHOUT
RECOURSE and without representation or warranty except as expressly set forth
herein, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement and the other Loan Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Credit Agreement and the other Loan Documents. After
giving effect to such sale and assignment, the Assignee's Revolving Loans owing
to the Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that 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 adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Credit Party or
the performance or observance by any Credit Party of any of its obligations
under the Loan Documents or any other instrument or document furnished pursuant
thereto; and (iv) attaches the Note held by the Assignor and requests that the
Agent exchange such Note for new Notes payable to the order of the Assignee in
an amount equal to the Revolving Credit Commitment assumed by the Assignee
pursuant hereto and to the Assignor in an amount equal to the Revolving Credit
Commitment retained by the Assignor, if any, as specified on Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 9.1 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon the Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iii) confirms that it is an Eligible Assignee; (iv) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement as are delegated to the
Agent by
B-1
the terms thereof, together with such powers and discretion as are reasonably
incidental thereto; (v) agrees that it will perform in accordance with their
terms all of the obligations that by the terms of the Credit Agreement are
required to be performed by it as a Lender; and (vi) attaches any U.S. Internal
Revenue Service or other forms required under Section 6.6.
4. Following the execution of this Assignment and Acceptance, it will
be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1.
5. Upon such acceptance and recording by the Agent, as of the Effective
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights (other than
rights under Sections 3.2(g), 4.1, 4.6, 7.15, 11.5 and 11.9 of the Credit
Agreement which shall survive the assignment hereunder) and be released from its
obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after the
Effective Date, the Agent shall make all payments under the Credit Agreement and
the Notes in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and commitment fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes for periods
prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of New York.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telefacsimile
shall be effective as delivery of a manually executed counterpart of this
Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule
1 to this Assignment and Acceptance to be executed by their officers thereunto
duly authorized as of the date specified thereon.
B-2
Schedule 1
----------
Percentage interest assigned: ________%
Assignee's Commitment: $_______
Aggregate outstanding principal amount
of Loans assigned: $_______
Principal amount of Revolving Note payable to
Assignee: $_______
Principal amount of Revolving Note payable to
Assignor: $_______
Effective Date (if other than date
of acceptance by Agent): *_______, 19__
[NAME OF ASSIGNOR], as Assignor
By:________________________________
Title:
Dated:_______________________, 19 _
[NAME OF ASSIGNEE], as Assignee
By:________________________________
Title:
Domestic Lending Office:
Eurodollar Lending Office:
* This date should be no earlier than five Business Days after the
delivery of this Assignment and Acceptance to the Agent.
Accepted [and Approved] **
this ___ day of ___________, 19 _
NationsBank of Texas, National Association
B-3
By:_______________
Title:
[Approved this ____ day
of ____________, 19__
Data General Corporation
By:____________________]**
Title:
** Required if the Assignee is an Eligible Assignee solely by reason of clause
(iii) of the definition of "Eligible Assignee".
B-4
EXHIBIT C
---------
Notice of Appointment (or Revocation) of Authorized Representative
------------------------------------------------------------------
Reference is hereby made to the Credit Agreement dated as of
September 30, 1997 (the "Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Capitalized terms used but not defined herein shall have the
respective meanings therefor set forth in the Agreement.
The Borrower hereby nominates, constitutes and appoints each
individual named below as an Authorized Representative under the Loan Documents,
and hereby represents and warrants that (i) set forth opposite each such
individual's name is a true and correct statement of such individual's office
(to which such individual has been duly elected or appointed), a genuine
specimen signature of such individual and an address for the giving of notice,
and (ii) each such individual has been duly authorized by the Borrower to act as
Authorized Representative under the Loan Documents:
Name and Address Office Specimen Signature
----------------- --------------- ------------------
-----------------
----------------- --------------- ------------------
-----------------
Borrower hereby revokes (effective upon receipt hereof by the Agent) the prior
appointment of ________________ as an Authorized Representative.
This the ___ day of __________________, 19__.
By:_________________________________
Name:_______________________________
Title:______________________________
X-0
XXXXXXX X-0
-----------
Form of Borrowing Notice--Revolving Credit Loans
------------------------------------------------
To: NationsBank of Texas, National Association,
as Agent
000 Xxxx Xxxxxx
XX0-000-00-00
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telefacsimile: (000) 000-0000
Reference is hereby made to the Credit Agreement dated as of
September 30, 1997 (the "Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Capitalized terms used but not defined herein shall have the
respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives
notice to the Agent that Loans of the type and amount set forth below be made on
the date indicated:
Type of Loan Interest Aggregate
(check one) Period(1) Amount(2) Date of Loan(3)
----------- --------- ---------- ---------------
Revolving Loan
--------------
o Base Rate Loan ______ _________ ____________
o Eurodollar Rate Loan ______ _________ ____________
----------------------
(1) For any Eurodollar Rate Loan, one, two, three or six months.
(2) Must be $_________ or if greater an integral multiple of $_______, unless a
Base Rate Refunding Loan.
(3)At least three (3) Business Days later if a Eurodollar Rate Loan;
The Borrower hereby requests that the proceeds of Loans described
in this Borrowing Notice be made available to the Borrower as follows: [insert
transmittal instructions] .
The undersigned hereby certifies that:
1. No Default or Event of Default exists either now or after
giving effect to the borrowing described herein; and
D-1-1
2. All the representations and warranties set forth in Article VIII
of the Agreement and in the Loan Documents (other than those expressly stated to
refer to a particular date) are true and correct as of the date hereof except
that the reference to the financial statements in Section 6.6(a) of the
Agreement are to those financial statements most recently delivered to you
pursuant to Section 7.1 of the Agreement (it being understood that any financial
statements delivered pursuant to Section 7.1(b) have not been certified by
independent public accountants) and attached hereto are any changes to the
Schedules referred to in connection with such representations and warranties.
3. All conditions contained in the Agreement to the making of any
Loan requested hereby have been met or satisfied in full.
DATA GENERAL CORPORATION
BY:____________________________________
Authorized Representative
DATE:__________________________________
X-0-0
XXXXXXX X-0
-------------
Form of Borrowing Notice--Swing Line Loans
-------------------------------------------
To: NationsBank of Texas, National Association,
as Agent
000 Xxxx Xxxxxx
XX0-000-00-00
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telefacsimile:(000) 000-0000
Reference is hereby made to the Credit Agreement dated as of
September 30, 1997 (the "Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Capitalized terms used but not defined herein shall have the
respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives
notice to the Agent that Loans of the type and amount set forth below be made on
the date indicated:
Amount(1) Date of Loan
-----------------------
(1)Must be $100,000 or if greater an integral multiple of $50,000, unless a Base
Rate Refunding Loan.
The Borrower hereby requests that the proceeds of Loans described
in this Borrowing Notice be made available to the Borrower as follows: [insert
transmittal instructions] .
The undersigned hereby certifies that:
0.Xx Default or Event of Default exists either now or after giving
effect to the borrowing described herein; and
2. All the representations and warranties set forth in Article VIII
of the Agreement and in the Loan Documents (other than those expressly stated to
refer to a particular date) are true and correct as of the date hereof except
that the reference to the financial statements in Section 6.6(a) of the
Agreement are to those financial statements most recently delivered to you
pursuant to Section 7.1 of the Agreement (it being understood that any financial
D-2-1
statements delivered pursuant to Section 7.1(b) have not been certified by
independent public accountants) and attached hereto are any changes to the
Schedules referred to in connection with such representations and warranties.
3. All conditions contained in the Agreement to the making of any
Swing Line Loan requested hereby have been met or satisfied in full .
DATA GENERAL CORPORATION
By:______________________________
Authorized Representative
Date:____________________________
D-2-2
EXHIBIT E
---------
Form of Interest Rate Selection Notice
--------------------------------------
To: NationsBank of Texas, National Association,
as Agent
000 Xxxx Xxxxxx
XX0-000-00-00
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telefacsimile:(000) 000-0000
Reference is hereby made to the Credit Agreement dated as of
September 30, 1997 (the "Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Capitalized terms used but not defined herein shall have the
respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives
notice to the Agent of the following selection of a type of Loan and Interest
Period:
Type of Loan Interest Aggregate
(check one) Period(1) Amount(2) Date of Loan(3)
------------- --------- ----------- ---------------
Revolving Loan
o Base Rate Loan ______ _________ ____________
o Eurodollar Rate Loan ______ _________ ____________
-----------------------
(1) For any Eurodollar Rate Loan, one, two, three or six months.
(2) Must be $_________ or if greater an integral multiple of $_______, unless a
Base Rate Refunding Loan.
(3) At least three (3) Business Days later if a Eurodollar Rate Loan;
----------------------------------------
BY:_____________________________________
Authorized Representative
DATE:___________________________________
E-1
EXHIBIT F-1
-----------
Form of Revolving Note
----------------------
Promissory Note
(Revolving Loan)
$______________ New York, New York
______ __, 1997
FOR VALUE RECEIVED, DATA GENERAL CORPORATION, a Delaware corporation
(the "Borrower"), hereby promises to pay to the order of________________________
--------------------------------------------------------------------------------
(the "Lender"), in its individual capacity, at the office of NationsBank of
Texas, National Association, as agent for the Lenders (the "Agent"), located at
000 Xxxx Xxxxxx, XX0-000-00-00, Xxxxxx, Xxxxx 00000 (or at such other place or
places as the Agent may designate in writing) at the times set forth in the
Credit Agreement dated as of September 30, 1997 among the Borrower, the
financial institutions party thereto (collectively, the "Lenders") and the Agent
(the "Agreement" -- all capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Agreement), in lawful money of the
United States of America, in immediately available funds, the principal amount
of ___________ DOLLARS ($__________) or, if less than such principal amount, the
aggregate unpaid principal amount of all Revolving Loans made by the Lender to
the Borrower pursuant to the Agreement on the Revolving Credit Termination Date
or such earlier date as may be required pursuant to the terms of the Agreement,
and to pay interest from the date hereof on the unpaid principal amount hereof,
in like money, at said office, on the dates and at the rates provided in Article
II of the Agreement. All or any portion of the principal amount of Loans may be
prepaid or required to be prepaid as provided in the Agreement.
If payment of all sums due hereunder is accelerated under the terms of
the Agreement or under the terms of the other Loan Documents executed in
connection with the Agreement, the then remaining principal amount and accrued
but unpaid interest shall bear interest which shall be payable on demand at the
Default Rate. Further, in the event of such acceleration, this Revolving Note
shall become immediately due and payable, without presentation, demand, protest
or notice of any kind, all of which are hereby waived by the Borrower.
In the event this Revolving Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys' fees, and
interest due hereunder thereon at the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
F-1-1
This Revolving Note is one of the Revolving Notes in the principal
amount of $110,000,000 referred to in the Agreement and is issued pursuant to
and entitled to the benefits and security of the Agreement to which reference is
hereby made for a more complete statement of the terms and conditions upon which
the Revolving Loans evidenced hereby were or are made and are to be repaid. This
Revolving Note is subject to certain restrictions on transfer or assignment as
provided in the Agreement.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby waive
to the full extent permitted by law the benefits of all provisions of law for
stay or delay of execution or sale of property or other satisfaction of judgment
against any of them on account of liability hereon until judgment be obtained
and execution issues against any other of them and returned satisfied or until
it can be shown that the maker or any other party hereto had no property
available for the satisfaction of the debt evidenced by this instrument, or
until any other proceedings can be had against any of them, also their right, if
any, to require the holder hereof to hold as security for this Revolving Note
any collateral deposited by any of said Persons as security. Protest, notice of
protest, notice of dishonor, diligence or any other formality are hereby waived
by all parties bound hereon.
IN WITNESS WHEREOF, the Borrower has caused this Revolving Note to be
made, executed and delivered by its duly authorized representative as of the
date and year first above written, all pursuant to authority duly granted.
DATA GENERAL CORPORATION
By:_____________________________________
Name:___________________________________
Title:__________________________________
F-1-2
EXHIBIT F-2
-----------
Form of Swing Line Note
-----------------------
$5,000,000 New York, New York
September __, 1997
FOR VALUE RECEIVED, FOR VALUE RECEIVED, DATA GENERAL CORPORATION, a
Delaware corporation (the "Borrower"), hereby promises to pay to the order of
NATIONSBANK OF TEXAS, NATIONAL ASSOCIATION (the "Lender"), in its individual
capacity, at its office, located at 000 Xxxx Xxxxxx, XX0-000-00-00, Xxxxxx,
Xxxxx 00000 (or at such other place or places as the Lender may designate) at
the times set forth in the Credit Agreement dated as of September 30, 1997 among
the Borrower, the financial institutions party thereto (collectively, the
"Lenders") and the Agent (as from time to time, amended, supplemented or
replaced, the "Agreement" -- all capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Agreement), in lawful money
of the United States of America, in immediately available funds, the lesser of
(i) the principal amount of FIVE MILLION DOLLARS ($5,000,000) or (ii) if less
than such principal amount, the aggregate unpaid principal amount of all Swing
Line Loans made by the Lender to the Borrower pursuant to the Agreement on the
Revolving Credit Termination Date or such earlier date as may be required
pursuant to the terms of the Agreement, and to pay interest from the date hereof
on the unpaid principal amount hereof, in like money, at said office, on the
dates and at the rates provided in Section 2.13 of the Agreement. All or any
portion of the principal amount of Loans may be prepaid as provided in the
Agreement.
If payment of all sums due hereunder is accelerated under the terms of
the Agreement or under the terms of the other Loan Documents executed in
connection with the Agreement, the then remaining principal amount and accrued
but unpaid interest shall bear interest which shall be payable on demand at a
rate of two percent (2%) per annum in excess of the Base Rate for such Swing
Line Loan, or the maximum rate permitted under applicable law, if lower, until
such principal and interest have been paid in full. Further, in the event of
such acceleration, this Note, and all other indebtedness of the Borrower to the
Lender shall become immediately due and payable, without presentation, demand,
protest or notice of any kind, all of which are hereby waived by the Borrower.
In the event this Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys' fees, and
interest thereon at the rates set forth above.
F-2-1
Interest hereunder shall be computed as specified in the Agreement.
This Note is the Swing Line Note referred to in the Agreement and is
issued pursuant to and entitled to the benefits of the Agreement to which
reference is hereby made for a more complete statement of the terms and
conditions upon which the Loans evidenced hereby were or are made and are to be
repaid. This Note is subject to certain restrictions on transfer or assignment
as provided in the Agreement.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby waive
to the full extent permitted by law the benefits of all provisions of law for
stay or delay of execution or sale of property or other satisfaction of judgment
against any of them on account of liability hereon until judgment be obtained
and execution issues against any other of them and returned satisfied or until
it can be shown that the maker or any other party hereto had no property
available for the satisfaction of the debt evidenced by this instrument, or
until any other proceedings can be had against any of them, also their right, if
any, to require the holder hereof to hold as security for this Note any
collateral deposited by any of said Persons as security. Protest, notice of
protest, notice of dishonor, diligence or any other formality are hereby waived
by all parties bound hereon.
IN WITNESS WHEREOF, the Borrower has caused this Note to be made,
executed and delivered by its duly authorized representatives as of the date and
year first above written, all pursuant to authority duly granted.
DATA GENERAL CORPORATION
By: _________________________________
Name: ______________________________
Title: ______________________________
F-2-2
EXHIBIT G
---------
Form of Opinion of Borrower's Counsel
-------------------------------------
_____________ ___, 199_
NationsBank of Texas, National Association,
as Agent and
Each of the Lenders Party to the
Credit Agreement Referenced Below
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Re: Revolving Credit and Letter of Credit Facilities among NationsBank of Texas,
National Association, as Agent, the Lenders party thereto and Data General
Corporation
Ladies and Gentlemen:
We have acted as counsel to Data General Corporation, a Delaware
corporation (the "Borrower"), and the Guarantors in connection with the
Revolving Loan in an aggregate amount of up to $110,000,000 (the "Revolving
Loans"), including the $10,000,000 Swing Line Facility and the $15,000,000
Letter of Credit Facility constituting part of the Revolving Credit Facility
(the "LC Facility"), each being made available to the Borrower by you on this
date pursuant to the Credit Agreement of even date herewith among you, the
Lenders and the Borrower (the "Credit Agreement"), and the other transactions
contemplated under the Credit Agreement.
This opinion is being delivered in accordance with the conditions set
forth in Section 5.1 of the Credit Agreement. All capitalized terms not
otherwise defined herein shall have the meanings provided therefor in the Credit
Agreement.
As such counsel, we have reviewed the following documents:
1. the Credit Agreement;
2. the Notes;
3. the Swing Line Note; and
G-1
4. the Subsidiary Guaranty.
The documents described in items 1 through 4 immediately above are
referred to herein as the "Loan Documents".
For purposes of the opinions expressed below, we have assumed that all
natural persons executing the Loan Documents have legal capacity to do so; that
all signatures (other than those of representatives of the Borrower and the
Guarantors on the Loan Documents) on all documents submitted to us are genuine;
that all documents submitted to us as originals (other than the Loan Documents)
are authentic; and that all documents submitted to us as certified copies or
photocopies conform to the originals of such documents, which themselves are
authentic.
In addition, for purposes of giving this opinion, we have examined such
corporate records of the Borrower and the Guarantors, certificates of public
officials, certificates of appropriate officials of the Borrower and the
Guarantors, and such other documents, and have made such inquiries as we have
deemed appropriate.
Based upon and subject to the foregoing, it is our opinion that:
1. The Borrower is a corporation duly organized, validly existing and
in good standing under the laws of its state of incorporation and is duly
qualified to transact business as a foreign corporation and is in good standing
in all jurisdictions in which the nature of its business requires such
qualification and in which the failure to be so qualified would reasonably be
likely to result in a Material Adverse Effect. The Borrower has full corporate
power and authority to own its assets and conduct the businesses in which it is
now engaged and as are expressly contemplated by the Loan Documents, and has
full corporate power and authority to enter into each of the Loan Documents to
which it is a party and to perform its obligations thereunder.
2. Each of the Loan Documents to which the Borrower is a party has been
duly authorized by the Board of Directors of the Borrower (and by any required
shareholder action), has been duly executed and delivered by the Borrower, and
constitutes the legal, valid and binding obligation, agreement, instrument or
conveyance, as the case may be, of the Borrower, enforceable against the
Borrower in accordance with its respective terms, except as the enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization and
other similar laws relating to or affecting creditors' rights generally and by
the application of general equitable principles (whether considered in
proceedings at law or in equity).
3. Each Credit Party (other than the Borrower) is a corporation duly
organized, validly existing and in good standing under the laws of its
respective state of its formation and is duly qualified to transact business as
a foreign entity and is in good standing in all jurisdictions in which the
nature of its business requires such qualification and in which the failure to
be so qualified would reasonably be likely to result in a Material Adverse
Effect. Each Credit Party (other than the Borrower) has full corporate power and
authority to own its assets and conduct the businesses in which it is now
engaged and as expressly contemplated in the Loan Documents, and
G-2
has full corporate power and authority to enter into each of the Loan Documents
to which it is a party and to perform its obligations thereunder.
4. Each of the Loan Documents to which each Credit Party (other than
the Borrower) is a party has been duly authorized by the Board of Directors of
such Credit Party (and by any required shareholder action), has been duly
executed and delivered by such Credit Party, and con stitutes the legal, valid
and binding obligation, agreement or instrument, as the case may be, of such
Credit Party, enforceable against such Credit Party in accordance with its
respective terms, except as the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization and other similar laws
relating to or affecting creditors' rights generally and by the application of
general equitable principles (whether considered in proceedings at law or in
equity).
5. Neither the execution or delivery of, nor performance by the
Borrower or any other Credit Party of its obligations under, the Loan Documents
(a) does or will conflict with, violate or constitute a breach of (i) the
Organizational Documents or Operating Documents of the Borrower or any other
Credit Party, (ii) any laws, rules or regulations applicable to the Borrower or
any other Credit Party, or (iii) any contract, agreement, indenture, lease,
instrument, other document, judgment, writ, determination, order, decree or
arbitral award to which the Borrower or any Subsidiary is a party or by which
the Borrower or any Subsidiary or any other Credit Party or any of their
properties is bound, (b) requires the prior consent of, notice to, license from
or filing with any Governmental Authority which has not been duly obtained or
made on or prior to the date hereof, or (c) does or will result in the creation
or imposition of any lien, pledge, charge or encumbrance of any nature upon or
with respect to any of the properties of the Borrower or any Subsidiary or any
other Credit Party, except for the Liens in your favor expressly created
pursuant to the Loan Documents.
6. There is no pending or, to our knowledge, threatened, action, suit,
investigation or proceeding (including, without limitation, any action, suit,
investigation, or proceeding under any environmental or labor law), nor is there
any basis therefor, before or by any court, or governmental department,
commission, board, bureau, instrumentality, agency or arbitral authority, (i)
which calls into question the validity or enforceability of any of the Loan
Documents, or the titles to their respective offices or authority of any
officers of the Borrower or any other Credit Party or (ii) an adverse result in
which would reasonably be likely to have a Material Adverse Effect.
7. Neither the Borrower nor any Subsidiary nor any other Credit Party
is subject to any Organizational Document or Operating Document or other
corporate restrictions nor, to our knowledge, is the Borrower or any Subsidiary
or any other Credit Party party to or bound by any contract or agreement which
(i) materially and adversely affects its business, properties or condition
(financial or otherwise), or (ii) restricts, limits, or prohibits performance of
any of their respective obligations pursuant to the terms of the Loan Documents.
0.Xx our knowledge after due inquiry, neither the Borrower nor any
Subsidiary nor any other Credit Party (i) is in default (which default has not
been waived) under any agreement,
G-3
document or instrument to which it is a party or by which it or any of its
assets is bound or (ii) is in violation of any law, rule, regulation, judgment,
writ, determination, order, decree or arbitral award to which the Borrower or
any Subsidiary or any other Credit Party is a party or by which the Borrower or
any Subsidiary or any other Credit Party or any of their respective properties
is bound, which default or violation, as the case may be, would constitute a
Default or Event of Default under the Credit Agreement or otherwise could
reasonably be likely to have a Material Adverse Effect.
9. None of the transactions contemplated by the Credit Agreement,
including, without limitation, the use of the proceeds of the Loans provided for
in the Loan Documents, will violate or result in a violation of Section 7 of the
Securities Exchange Act of 1934, as amended, any regulations issued pursuant
thereto, or regulations G, T, U or X of the Board of Governors of the Federal
Reserve System.
Our opinions contained herein are rendered solely in connection with
the transactions contemplated under the Loan Documents and may not be relied
upon in any manner by any Person other than the addressees hereof, any successor
or assignee of any addressee (including successive assignees) and any Person who
shall acquire a participation interest in the interest of any Lender
(collectively, the "Reliance Parties"), or by any Reliance Party for any other
purpose. Our opinions herein shall not be quoted or otherwise included,
summarized or referred to in any publication or document, in whole or in part,
for any purposes whatsoever, or furnished to any Person other than a Reliance
Party (or a Person considering whether to become a Reliance Party), except as
may be required of any Reliance Party by applicable law or regulation or in
accordance with any auditing or oversight function or request of regulatory
agencies to which a Reliance Party is subject.
Very truly yours,
G-4
EXHIBIT H
---------
Compliance Certificate
----------------------
NationsBank of Texas, National Association,
as Agent
000 Xxxx Xxxxxx
XX0-000-00-00
Xxxxxx, Xxxxx 00000
Attention: Agency Services
Telefacsimile:(000) 000-0000
NationsBank of Texas, National Association,
as Agent
000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxxx Xxxx, Senior Vice President
Telefacsimile:(000) 000-0000
Reference is hereby made to the Credit Agreement dated as of September
30, 1997 (the "Agreement") among Data General Corporation, a Delaware
corporation (the "Borrower"), the Lenders (as defined in the Credit Agreement)
and NationsBank of Texas, National Association, as agent for the Lenders (the
"Agent"). Capitalized terms used but not otherwise defined herein shall have the
respective meanings therefor set forth in the Agreement. The undersigned, a duly
authorized and acting Authorized Representative, hereby certifies to you as of
__________ (the "Determination Date") as follows:
1. Calculations:
A. Compliance with Section 8.1(a): Consolidated Leverage Ratio
1. Consolidated Funded Indebtedness $______________
2. Consolidated EBITDA* $______________
3. Ratio of A.1 to A.2 __.__ to 1.00
Required: A.3 must not be greater than 2.25 to 1.00
* See attached Schedule 1 for EBIT and EBITDA calculation
H-1
B. Compliance with Section 8.1(b): Consolidated Fixed Charge Ratio
1. Consolidated EBIT* $______________
2. Consolidated Lease Payments $______________
3. Sum of B.1 + B.2 $______________
4. Consolidated Interest Expense $______________
5. Consolidated Lease Payments $______________
6. Sum of B.4 + B.5 $______________
7. Ratio of B.3 to B.6 __.__ to 1.00
Required: B.7 must not be less than 1.50 to 1.00
C.Compliance with Section 8.1(c): Consolidated Tangible Net Worth
1. Required Consolidated Tangible Net Worth at the last
day of the preceding fiscal quarter $______________
2. Consolidated Net Income x 0.5 $______________
3. Net Proceeds of any Equity Offering $______________
4. Sum of C.1 + C.2 + C.3 $______________
5. Actual Consolidated Tangible Net Worth $______________
Required: C.5 must not be less than C.4
D. Compliance with Section 8.1(d): Consolidated Liquidity Ratio
1. Cash $______________
2. Eligible Securities $______________
3. Consolidated Accounts Receivable $______________
* See attached Schedule 1 for EBIT and EBITDA calculation
H-2
4. Sum of D.1 + D.2 + D.3 $______________
5. Consolidated Funded Indebtedness $______________
6. Consolidated Accounts Payable $______________
7. Sum of D.5 + D.6 $______________
8. Ratio of D.4 to D.7 __.__ to 1.00
Required: D.8 must not be less than 1.50 to 1.00
2. No Default
A. Since __________ (the date of the last similar
certification), (a) the Borrower has not defaulted in the
keeping, observance, performance or fulfillment of its
obligations pursuant to any of the Loan Documents; and (b) no
Default or Event of Default specified in Article IX of the
Agreement has occurred and is continuing.
B. If a Default or Event of Default has occurred
since __________ (the date of the last similar certification),
the Borrower proposes to take the following action with
respect to such Default or Event of Default:
(Note, if no Default or Event of Default has
occurred, insert "Not Applicable").
The Determination Date is the date of the last required financial
statements submitted to the Lenders in accordance with Section 7.1 of the
Agreement.
IN WITNESS WHEREOF, I have executed this Certificate this _____ day of
__________, 19___.
By:_____________________________________
Authorized Representative
Name:___________________________________
Title:__________________________________
H-3
Schedule 1 to Compliance Certificate
------------------------------------
[Insert Applicable Determination Date__,__]
-------------------------------------------
Consolidated EBITDA Calculation
A. Consolidated Net Income $____________________
B. Consolidated Interest Expense $____________________
C. Taxes on Income $____________________
D. Consolidated EBIT $____________________
(A +B+C)
E. Amortization $____________________
F. Depreciation $____________________
G. Consolidated EBITDA $____________________
(D +E +F)
H-4
EXHIBIT I
---------
Form of Subsidiary Guaranty
---------------------------
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (the "Guaranty Agreement" or the "Guaranty"),
dated as of September 30, 1997, is made by each of the undersigned guarantors
(each a "Guarantor" and collectively the "Guarantors") to NATIONSBANK, NATIONAL
ASSOCIATION, a national banking association organized and existing under the
laws of the United States, as Agent (the "Agent") for each of the financial
institutions (each a "Lender" and collectively, the "Lenders") now or hereafter
party to the Credit Agreement (as defined below).
W I T N E S S E T H:
-------------------
WHEREAS, the Agent and the Lenders have agreed to provide to Data
General Corporation, a Delaware corporation (the "Borrower"), certain revolving
credit facilities and letter of credit facilities pursuant to the terms of the
Credit Agreement dated as of September 29, 1997 among the Borrower, the Agent
and the Lenders (as from time to time amended, modified or supplemented, the
"Credit Agreement"); and
WHEREAS, each Guarantor is a Material Subsidiary of the Borrower;
WHEREAS, the Agent and the Lenders are unwilling to enter into the
Credit Agreement and to make the Loans thereunder unless each Guarantor
guarantees to the Lenders payment of the Borrower's Liabilities (as hereinafter
defined) in accordance with the terms of this Guaranty; and
WHEREAS, each Guarantor will materially benefit from the Loans to be
made under the Credit Agreement, and each Guarantor is willing to enter into
this Guaranty to provide an inducement for the Lenders and the Agent to enter
into the Credit Agreement and for the Lenders to make the Loans thereunder.
NOW, THEREFORE, in order to induce the Lenders and the Agent to enter
into the Credit Agreement and to make the Loans thereunder, each Guarantor
agrees as follows:
1. Definitions.
------------
All capitalized terms not otherwise defined herein shall have the meanings
ascribed to such terms in the Credit Agreement.
2. Guaranty.
--------
Each Guarantor hereby jointly and severally, unconditionally, absolutely,
continually and irrevocably guarantees to the Agent and the Lenders the payment
and performance in full of the Borrower's Liabilities (as defined below). For
all purposes of this Guaranty Agreement, "Borrower's Liabilities" means: (a) the
Borrower's prompt payment in full, when due or declared due and at all such
times, of all Obligations and all other amounts pursuant to the terms of the
I-1
Credit Agreement, the Notes, and all other Loan Documents executed in connection
with the Credit Agreement heretofore, now or at any time or times hereafter
owing, arising, due or payable from the Borrower to the Lenders, including
without limitation principal, interest, premium or fee (including, but not
limited to, loan fees and attorneys' fees and expenses); and (b) Borrower's
prompt, full and faithful performance, observance and discharge of each and
every agreement, undertaking, covenant and provision to be performed, observed
or discharged by the Borrower under the Credit Agreement and all other Loan
Documents executed in connection therewith. Each Guarantor's obligations to the
Agent and the Lenders under this Guaranty Agreement are hereinafter collectively
referred to as the "Guarantors' Obligations";
Each Guarantor agrees that it is jointly and severally, directly and
primarily liable for the Borrowers' Liabilities; provided, however, the
obligations of each Guarantor hereunder shall be limited to an aggregate amount
equal to the largest amount that would not render its obligations hereunder
subject to avoidance under Section 548 of the United States Bankruptcy Code or
any comparable provisions of any applicable state law.
3. Payment.
--------
If the Borrower shall default in payment or performance of any Borrower's
Liabilities, whether principal, interest, premium, fee (including, but not
limited to, loan fees and attorneys' fees and expenses), or otherwise, when and
as the same shall become due, whether according to the terms of the Credit
Agreement, by acceleration, or otherwise, or upon the occurrence of any other
Event of Default under the Credit Agreement that has not been cured or waived,
then each Guarantor, upon demand thereof by the Agent or its successors or
assigns, will as of the date of the Agent's demand fully pay to the Agent, for
the benefit of the Lenders, subject to any restriction set forth in Section 2
hereof, an amount equal to all Guarantors' Obligations then due and owing. Each
Guarantor hereby agrees that the Guarantors' Obligations will be paid in lawful
currency of the United States of America and in immediately available funds,
regardless of any law, regulation or decree now or hereafter in effect that
might in any manner affect the Borrower's Liabilities, or the rights of the
Agent or any Lender with respect thereto as against the Borrower, or cause or
permit to be invoked any alteration in the time, amount or manner of payment by
the Borrower of any or all of the Borrower's Liabilities.
4. Unconditional Obligations.
--------------------------
This is a guaranty of payment and not of collection. The Guarantors' Obligations
under this Guaranty Agreement shall be joint and several, absolute and
unconditional irrespective of the validity, legality or enforceability of the
Credit Agreement, the Notes or any other Loan Document or any other guaranty of
the Borrower's Liabilities, and shall not be affected by any action taken under
the Credit Agreement, the Notes or any other Loan Document, this Guaranty
Agreement against any other Guarantor, any other guaranty of the Borrower's
Liabilities, or any other agreement between the Agent or the Lenders and the
Borrower or any other person, in the exercise of any right or power therein
conferred, or by any failure or omission to enforce any right conferred hereby
or thereby, or by any waiver of any covenant or condition herein or therein
provided, or by any acceleration of the maturity of any of the Borrower's
Liabilities, or by the release or other disposal of any security for any of the
Borrower's Liabilities, or by the dissolution of the Borrower or any Guarantor
or the combination or consolidation of the Borrower or any Guarantor into or
with another entity or any transfer or disposition of any assets of the
I-2
Borrower or any Guarantor or by any extension or renewal of the Credit Agreement
any of the Notes or any other Loan Document, in whole or in part, or by any
modification, alteration, amendment or addition of or to the Credit Agreement,
any of the Notes or any other Loan Document, this Guaranty Agreement or any
other guaranty of the Borrower's Liabilities, or any other agreement between the
Agent or the Lenders and the Borrower or any other Person, or by any other
circumstance whatsoever(with or without notice to or knowledge of any Guarantor)
which may or might in any manner or to any extent vary the risks of any
Guarantor, or might otherwise constitute a legal or equitable discharge of a
surety or guarantor; it being the purpose and intent of the parties hereto that
this Guaranty Agreement and the Guarantors' Obligations hereunder shall be
absolute and unconditional under any and all circumstances and shall not be
discharged except by payment as herein provided.
5. Subordination.
-------------
Until the Guarantors' Obligations are paid in full and the Lenders are under no
further obligation to lend or extend funds or credit which would constitute
Guarantors' Obligations, and until the occurrence of the Facility Termination
Date, each Guarantor hereby unconditionally subordinates all present and future
debts, liabilities or obligations of the Borrower to such Guarantor to the
Guarantors' Obligations, and all amounts due under such debts, liabilities, or
obligations shall, upon the occurrence and during the continuance of an Event of
Default, be collected and paid over forthwith to the Lenders on account of the
Guarantors' Obligations and, pending such payment, shall be held by each
Guarantor as agent and bailee of the Lenders separate and apart from all other
funds, property and accounts of such Guarantor; provided, however, nothing
herein shall be deemed to prevent such Guarantor from receiving payments of such
obligations from the Borrower other than after the occurrence and during the
continuation of an Event of Default. Each Guarantor, at the reasonable request
of the Lenders, shall execute such further documents in favor of the Lenders to
further evidence and support the purpose of this Section 5. Each Guarantor
hereby irrevocably waives and releases any right or rights of subrogation or
contribution existing at law, by contract or otherwise to recover all or any
portion of any payment made hereunder from the Borrower or any other Guarantor.
6. Suits.
-----
Each Guarantor from time to time shall pay to the Agent for the benefit of the
Lenders, on demand, at the Agent's place of business set forth in the Credit
Agreement, the Guarantors' Obligations as they become or are declared due, and
in the event such payment is not made forthwith, the Agent or the Lenders or any
of them may proceed to suit against any one or more or all of the Guarantors. At
the Agent's election, one or more and successive or concurrent suits may be
brought hereon by the Agent against any one or more or all of the Guarantors,
whether or not suit has been commenced against the Borrower, any other
Guarantor, any other guarantor of the Borrower's Liabilities, or any other
Person and whether or not the Agent or any Lender has taken or failed to take
any other action to collect all or any portion of theBorrower's Liabilities.
7. Set-Off and Waiver.
--------------------
Each Guarantor waives any right to assert against the Agent and the Lenders as a
defense, counterclaim, set-off or cross claim, any defense (legal or equitable)
or other claim which such Guarantor may now or at any time hereafter have
against the Borrower, each other Guarantor, the Agent or the Lenders, without
waiving any additional defenses, set-offs, counterclaims or other claims
I-3
otherwise available to such Guarantor. If at any time hereafter the Agent or any
Lender employs counsel for advice or other representation to enforce the
Guarantors' Obligations, then, in any of the foregoing events, all of the
expenses, costs and charges in any way or respect arising in connection
therewith or relating thereto shall be jointly and severally paid by the
Guarantors to the Agent, for the benefit of the Lenders, on demand.
8. Waiver; Subrogation.
-------------------
(a) Each Guarantor hereby waives notice of the following events or
occurrences: (i) the Agent's acceptance of this Guaranty Agreement; (ii) the
Lenders' heretofore, now or from time to time hereafter loaning monies or giving
or extending credit to or for the benefit of the Borrower, whether pursuant to
the Credit Agreement or the Notes or any amendments, modifications, or
supplements thereto, or replacements or extensions thereof; (iii) the Agent, the
Lenders or the Borrower heretofore, now or at any time hereafter, obtaining,
amending, sub stituting for, releasing, waiving or modifying the Credit
Agreement, the Notes or any other Loan Documents or this Guaranty Agreement with
respect to any other Guarantor; (iv) presentment, demand, default, non-payment,
partial payment and protest; (v) the Agent or the Lenders heretofore, now or at
any time hereafter granting to the Borrower (or any other party liable to the
Lenders on account of the Borrowers' Liabilities) any indulgence or extensions
of time of payment of the Borrower's Liabilities or granting to any other
Guarantor any indulgence or extension of time of payment of its Guarantors'
Obligations; and (vi) the Agent or the Lenders heretofore, now or at any time
hereafter accepting from the Borrower or any other Person, any partial payment
or payments on account of the Borrower's Liabilities or any collateral securing
the payment thereof or the Agent settling, subordinating, compromising,
discharging or releasing the same. Each Guarantor agrees that the Agent and each
Lender may heretofore, now or at any time hereafter do any or all of the
foregoing in such manner, upon such terms and at such times as the Agent and
each Lender, in its sole and absolute discretion, deems advisable, without in
any way or respect impairing, affecting, reducing or releasing such Guarantor
from the Guarantors' Obligations, and each Guarantor hereby consents to each and
all of the foregoing events or occurrences.
(b) Each Guarantor hereby agrees that payment or performance by such
Guarantor of the Guarantors' Obligations under this Guaranty Agreement may be
enforced by the Agent on behalf of the Lenders upon demand by the Agent to such
Guarantor without the Agent being required, each Guarantor expressly waiving any
right it may have to require the Agent, to (i) prosecute collection or seek to
enforce or resort to any remedies against the Borrower or any other Guarantor or
any other guarantor of the Borrower's Liabilities, it being expressly
understood, acknowledged and agreed to by each Guarantor that demand under this
Guaranty Agreement may be made by the Agent, and the provisions hereof enforced
by the Agent, effective as of the first date any Event of Default occurs and is
continuing under the Credit Agreement, or (ii) seek to enforce or resort to any
remedies with respect to any security interests, Liens or encumbrances granted
to the Agent by the Borrower, any other Guarantor, or any other Person on
account of the Borrower's Liabilities or any guaranty thereof or the Guarantors'
Obligations. Neither the Agent nor any Lender shall have any obligation to
protect, secure or insure any of the foregoing security interests, Liens or
I-4
encumbrances on the properties or interests in properties subject thereto. The
Guarantors' Obligations shall in no way be impaired, affected, reduced, or
released by reason of the Agent's or any Lender's failure or delay to do or take
any of the acts, actions or things described in this Guaranty Agreement
including, without limiting the generality of the foregoing, those acts, actions
and things described in this Section 8.
(c) Each Guarantor further agrees with respect to this Guaranty
Agreement that such Guarantor shall have no right of subrogation, reimbursement
or indemnity, nor any right of recourse to security for the Borrower's
Liabilities until the Facility Termination Date has occurred.
9. Effectiveness; Enforceability.
------------------------------
This Guaranty Agreement shall be effective as of the date of the initial Advance
under the Credit Agreement and shall continue in full force and effect until the
Facility Termination Date. This Guaranty Agreement shall be binding upon and
inure to the benefit of each Guarantor, the Agent and the Lenders and their
respective successors and assigns. Notwithstanding the foregoing, no Guarantor
may, without the prior written consent of the Agent, assign any rights, powers,
duties or obligations hereunder. Any claim or claims that the Agent and the
Lenders may at any time hereafter have against any Guarantor under this Guaranty
Agreement may be asserted by the Agent or any Lender by written notice directed
to any one or more or all of the Guarantors at the address specified in the
Credit Agreement.
10. Representations and Warranties.
--------------------------------
Each Guarantor warrants and represents to the Agent for the benefit of the
Lenders that it is duly authorized to execute, deliver and perform this Guaranty
Agreement; that this Guaranty Agreement is legal, valid, binding and enforceable
against such Guarantor in accordance with its terms except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles; and that such Guarantor's execution, delivery and
performance of this Guaranty Agreement do not violate or constitute a breach of
its certificate of incorporation or other documents of corporate governance or
any agreement to which such Guarantor is a party, or any applicable laws.
11. Expenses.
--------
Each Guarantor agrees to be liable for the payment of all reasonable fees and
expenses, including attorney's fees, incurred by the Agent in connection with
the enforcement of this Guaranty Agreement, other than fees and expenses arising
as a result of the Agent's or a Lender's gross negligence or wilfull misconduct.
12. Reinstatement.
-------------
Each Guarantor agrees that this Guaranty Agreement and the obligations of each
Guarantor hereunder shall be reinstated at any time any payment received by the
Agent under the Credit Agreement or this Guaranty Agreement is rescinded or must
be restored for any reason after the Facility Termination Date.
13. Counterparts.
------------
This Guaranty Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original as against any party whose signature
appears thereon, and all of which shall constitute one and the same instrument.
I-5
14. Reliance.
---------
Each Guarantor represents and warrants to the Agent, for the benefit of the
Agent and the Lenders, that: (a) such Guarantor has adequate means to obtain
from the Borrower, on a continuing basis, information concerning the Borrower
and the Borrower's financial condition and affairs and has full and complete
access to the Borrower's books and records; (b) such Guarantor is not relying,
and will not rely, on the Agent or any Lender, its or their employees, agents or
other representatives, to provide such information, now or in the future; (c)
such Guarantor is executing this Guaranty Agreement freely and deliberately, and
understands the obligations and financial risk undertaken by providing this
Guaranty; (d) such Guarantor has relied solely on the Guarantor's own
independent investigation, appraisal and analysis of the Borrower and the
Borrower's financial condition and affairs in deciding to provide this Guaranty
and is fully aware of the same; and (e) such Guarantor has not depended or
relied on the Agent or any Lender, its or their employees, agents or
representatives, for any information whatsoever concerning the Borrowers or the
Borrower's financial condition and affairs or other matters material to such
Guarantor's decision to provide this Guaranty or for any counseling, guidance,
or special consideration or any promise therefor with respect to such decision.
Each Guarantor agrees that neither the Agent nor any Lender has any duty or
responsibility whatsoever, now or in the future, to provide to any Guarantor any
information concerning the Borrower or the Borrower's financial condition and
affairs, other than as expressly provided herein, and that, if such Guarantor
receives any such information from the Agent or any Lender, its or their
employees, agents or other representatives, such Guarantor will independently
verify the information and will not rely on the Agent or any Lender, its or
their employees, agents or other representatives, with respect to such
information.
15. Termination.
------------
Subject to reinstatement pursuant to Section 12 hereof, this Guaranty Agreement
and all obligations of the Guarantors hereunder shall terminate without delivery
of any instrument or performance of any act by any party on the Facility
Termination Date.
16. Governing Law; Venue; Waiver of Jury Trial.
------------------------------------------
(a) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORKAPPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
(b) EACH GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND
CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS GUARANTY AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE
INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX
XXXX, XXXXX XX XXX XXXX, XXXXXX XXXXXX OF AMERICA AND, BY THE EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH GUARANTOR EXPRESSLY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN,
OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY
SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND EACH GUARANTOR
I-6
HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) EACH GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE
BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER
LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED
OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF THE BORROWER
PROVIDED IN SECTION 11.2 OF THE CREDIT AGREEMENT, OR BY ANY OTHER
METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN
THE STATE OF NEW YORK.
(d) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS OR REMEDIES UNDER OR RELATED TO THIS GUARANTY OR ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE
BE DELIVERED IN CONNECTION THEREWITH, EACH GUARANTOR AND THE AGENT ON
BEHALF OF THE LENDERS HEREBY AGREE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE
TO TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING.
[Signature page Follows.]
I-7
IN WITNESS WHEREOF, the parties have duly executed this Agreement on
the day and year first written above.
GUARANTORS:
DATAGEN, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
DATA GENERAL INTERNATIONAL, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
DATA GENERAL INVESTMENT
CORPORATION
By:____________________________________
Name:__________________________________
Title:_________________________________
AGENT:
NATIONSBANK, NATIONAL ASSOCIATION,
as Agent for the Lenders
By:____________________________________
Name:__________________________________
Title:_________________________________
SIGNATURE PAGE 1 OF 1
EXHIBIT J
---------
Terms of Subordination*
----------------------
1. DEFINITIONS
-----------
1.1 Terms defined in the Credit Agreement shall have their defined
meanings when used herein unless otherwise defined herein, and the following
terms shall have the following meanings:
"Senior Loans" shall mean, collectively, the Loans and any extension,
renewal, refunding or refinancing thereof.
"Senior Obligations" shall mean the unpaid principal amount of, any
premium applicable to, and interest on (including, without limitation, interest
accruing after the maturity of the Senior Loans and interest accruing after the
filing of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
the Notes and all other obligations and liabilities of the Borrower or any
Guarantor to the Agent or the Lenders, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, the Notes,
the other Loan Documents or this Agreement and any other document made,
delivered or given in connection therewith or herewith, whether on account of
principal, premium, interest, reimbursement obligations, fees, indemnities,
costs, expenses (including, without limitation, all fees and disbursements of
counsel to the Agent or any Lender that are required to be paid by the Borrower
pursuant to the terms of the Credit Agreement) or otherwise.
"Subordinated Creditors" shall mean the holders of Subordinated Debt
and their successors and assigns.
"Subordinated Debt" shall mean the unpaid principal amount of, any
premium applicable to and any interest on the Indebtedness of the Subordinated
Debtor to the Subordinated Creditor evidenced by that certain promissory note
dated _____________ by the Subordinated Debtor payable to the Subordinated
Creditor in the original principal amount of $__________.
"Subordinated Debtor" means____________________________________________
1.2 (a) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified.
--------
* The terms hereof shall not apply to any Indebtedness under the Indenture.
J-1
(b) the meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. SUBORDINATION
------------
2.1 The Subordinated Creditor and the Subordinated Debtor agree, for
themselves and their respective successors and assigns, that the Subordinated
Debt is expressly subordinate and junior in right of payment (as defined in
subsection 2.2) to all Senior Obligations.
2.2 "Subordinate and junior in right of payment" shall mean that:
(a) The Subordinated Creditor shall not have any claim, as holder of
the Subordinated Debt, to any assets of the Subordinated Debtor on parity with
or prior to the claim of the Lenders as holders of the Senior Obligations. At
any time after an Event of Default shall have occurred and be continuing, the
Subordinated Creditor will not take, demand or receive from the Subordinated
Debtor or any of its direct or indirect subsidiaries, nor will the Subordinated
Debtor or any of its direct or indirect subsidiaries, give or permit, directly
or indirectly, by set-off, redemption, purchase or in any other manner, any
payment or prepayment of principal or interest on, or security, guarantee or
collateral for the whole or any part of, the Subordinated Debt.
(b) In the event (i) of any distribution, division or application,
partial or complete, voluntary or involuntary, by operation of law or otherwise,
of all or any substantial part of the property, assets or business of the
Subordinated Debtor or the proceeds thereof to any creditor or creditors of the
Subordinated Debtor or (ii) of any Indebtedness of the Subordinated Debtor
becoming due and payable by reason of any liquidation, dissolution or other
winding-up of the Subordinated Debtor or its business or by reason of any sale,
receivership, insolvency, reorganization or bankruptcy proceedings, assignment
for the benefit of creditors, arrangement or any proceeding by or against the
Subordinated Debtor for any relief under any bankruptcy, reorganization or
insolvency law or laws, Federal or state, or any law, Federal or state, relating
to the relief of debtors, readjustment of indebtedness, reorganization,
composition, or extension, or (iii) any of the Senior Obligations have become,
or have been declared to be, due and payable (and have not been paid in
accordance with their terms), then and in any such event, any payment or
distribution of any kind or character, whether in cash, property or securities
which, but for the subordination provisions contained herein, would otherwise be
payable or deliverable to the Subordinated Creditor upon or in respect of the
Subordinated Debt, shall instead be paid over or delivered to the Agent on
behalf of the Lenders to be applied to the Senior Obligations and the remainder,
if any, to be paid to the Subordinated Creditor.
3. PAYMENTS, ETC.
-------------
3.1 The Subordinated Creditor and the Subordinated Debtor irrevocably
authorize and empower (without imposing any obligation on) the Lenders, or the
Agent on behalf of the Lenders, under the circumstances set forth in clause (i)
or (ii) of subsection 2.2(b), to demand, xxx for, collect and receive every such
payment or distribution referred to in such subsection and give acquittance
therefor, and file claims and proofs of claim in any statutory or non-statutory
proceeding, to vote the Subordinated Debt in the sole discretion of the Lenders
J-2
or the Agent, as the case may be, in connection with any resolution,
arrangement, plan of reorganization, compromise, settlement or extension and to
take such other action (including, without limitation, the right to participate
in any composition of creditors and the right to vote such Subordinated Debt at
creditors' meetings for the election of trustees, acceptances of plans and
otherwise) and take such other proceedings, in their own names as Lenders, or
the Agent, as the case may be, or in the name of the Subordinated Creditor or
otherwise, as the Lenders or the Agent, as the case may be, may deem necessary
or advisable for the enforcement of the provisions of this Agreement. The
Subordinated Creditor hereby agrees, under the circumstances set forth in clause
(i) or (ii) of subsection 2.2(b), duly and promptly to take such action as may
be requested at any time and from time to time by the Lenders or the Agent to
enable the Lenders or the Agent, as the case may be, to enforce all claims upon
or in respect of the Subordinated Debt, including, without limitation, the
filing of appropriate proofs of claim in respect of the Subordinated Debt, and
to collect and receive any and all payments or distributions which may be
payable or deliverable any time upon or in respect of the Subordinated Debt.
3.2 Should any payment or distribution or security, or the proceeds of
any thereof, be collected or received by the Subordinated Creditor in respect of
the Subordinated Debt after the occurrence and during the continuance of an
Event of Default, the applicable Subordinated Creditor will forthwith deliver
the same to the Agent in the form received (except for the endorsement or
assignment of such Subordinated Creditor when necessary) and, until such
delivery, shall hold the same in trust for the benefit of the Agent.
3.3 Notwithstanding anything to the contrary in this Agreement, the
Subordinated Creditor hereby irrevocably waives all rights which may have arisen
in connection with this Agreement to be subrogated to any of the rights (whether
contractual, under the Bankruptcy Code, including Section 509 thereof, under
common law or otherwise) of the Agent or any Lender against the Subordinated
Debtor or against the Agent or any Lender for the payment of the Senior
Obligations. The Subordinated Creditor hereby further irrevocably waives all
contractual, common law, statutory or other rights of reimbursement,
contribution, exoneration or indemnity (or any similar right) from or against
the Subordinated Debtor or any other Person which may have arisen in connection
with this Agreement. So long as the Senior Obligations remain outstanding, if
any amount shall be paid by or on behalf of the Subordinated Debtor to the
Subordinated Creditor on account of any of the rights waived in this paragraph,
such amount shall be held by the Subordinated Creditor in trust, segregated from
other funds of the Subordinated Creditor, and shall, forthwith upon receipt by
the Subordinated Creditor, be turned over to the Agent, in the exact form
received by the Subordinated Creditor (duly indorsed by the Subordinated
Creditor to the Collateral Agent, if required), to be applied against the Senior
Obligations, whether matured or unmatured, in such order as the Agent may
determine. The provisions of this paragraph shall survive until the occurrence
of the Facility Termination Date.
3.4 Notwithstanding the foregoing, the obligations of the Subordinated
Creditor under this Agreement shall continue to be effective, or be reinstated,
as the case may be, if at any time any payment in respect of any Senior
Obligations, or any other payment to any Lender in respect of the Senior
Obligations, is rescinded or must otherwise be restored or returned by such
Lender upon, or as a result of the appointment of a receiver, intervenor or
conservator of, or trustee or similar officer for, the Debtor or any substantial
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part of its property, or otherwise, all as though such payment had not been
made.
J-4
EXHIBIT K
---------
Form of Cash Collateral Account Agreement
-----------------------------------------
CASH COLLATERAL ACCOUNT AGREEMENT
THIS CASH COLLATERAL ACCOUNT AGREEMENT (the "Agreement") dated as of
this 30th day of September, 1997, and made between DATA GENERAL CORPORATION, a
Delaware corporation (the "Pledgor"), and NATIONSBANK, NATIONAL ASSOCIATION, a
national banking association, as Agent (in such capacity herein and together
with any successors in such capacity, the "Agent") for each of the lenders (the
"Lenders" and together with the Agent, the "Secured Parties") now or hereafter
party to the Credit Agreement (as defined below).
W I T N E S S E T H:
WHEREAS, the Pledgor, the Lenders, and the Agent have entered into that
certain Credit Agreement dated as of the date hereof among the Pledgor, the
Agent and the Lenders (as from time to time amended, supplemented or restated,
the "Credit Agreement") pursuant to which the Lenders have agreed to make
certain credit facilities available to the Pledgor and to issue certain letters
of credit; and
WHEREAS, as a condition precedent to the Lenders' obligations to make
Loans or to issue Letters of Credit, the Pledgor is required to execute and
deliver to the Agent a copy of this Agreement on or before the Closing Date;
NOW, THEREFORE, in consideration of the foregoing and the agreements,
provisions and covenants contained herein, the Pledgor and the Agent hereby
agree as follows:
1. Definitions.
-----------
The following capitalized terms used in this Agreement shall have the following
meanings notwithstanding any definition thereof in the Credit Agreement. Other
capitalized terms used but not defined herein shall have the meanings therefore
set forth in the Credit Agreement.
"Collateral" means (a) all funds from time to time on deposit in the
Cash Collateral Account; (b) all Investments and all certificates and
instruments from time to time representing or evidencing such Investments; (c)
all notes, certificates of deposit, checks and other instruments from time to
time hereafter delivered to or otherwise possessed by the Agent for or on behalf
of the Pledgor in substitution for or in addition to any or all of the
Collateral described in clause (a) or (b) above; (d) all interest, dividends,
cash, instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the
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Collateral described in clause (a), (b) or (c) above; and (e) to the extent not
covered by clauses (a) through (d) above, all proceeds of any or all of the
foregoing Collateral.
"Investments" means those investments, if any, made by the Agent
pursuant to Section 5 hereof.
"Cash Collateral Account" means the cash collateral account established
and maintained pursuant to Section 2 hereof.
"Secured Obligations" means (i) all Obligations of the Pledgor now
existing or hereafter arising under or in respect of the Credit Agreement or the
Notes (including, without limitation, the Pledgor's obligation to pay principal
and interest and all other charges, fees, expenses, commissions, reimbursements,
indemnities and other payments related to or in respect of the obligations
contained in the Credit Agreement or the Notes) or any documents or agreement
related to the Credit Agreement or the Notes; and (ii) without duplication, all
obligations of the Pledgor now or hereafter existing under or in respect of this
Agreement, including, without limitation, with respect to all charges, fees,
expenses, commissions, reimbursements, indemnities and other payments related to
or in respect of the obligations contained in this Agreement.
0.Xxxx Collateral Account; Cash Collateralization of Letters of Credit.
--------------------------------------------------------------------
(i) At any time, in the Agent's sole discretion, the Agent
shall establish and maintain at its offices at 000 Xxxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx, in its name and under its sole dominion and
control, a cash collateral account designated as Data General
Corporation Cash Collateral Account.
(ii) In the event that the Pledgor delivers to the Agent an
amount equal to the maximum amount remaining undrawn or unpaid under
any Letters of Credit either (A) as required pursuant to Article IX of
the Credit Agreement or (B) as otherwise agreed by the parties hereto
to provide cash collateral for the undrawn amount of any Letter of
Credit, the Agent shall deposit such amount into the Cash Collateral
Account to be held pursuant to the terms of this Agreement. Upon a
drawing under the Letters of Credit in respect of which any amounts
described above have been deposited in the Cash Collateral Account, the
Agent shall apply such amounts to reimburse NationsBank for the amount
of such drawing. In the event the Letters of Credit are canceled or
expire or in the event of any reduction in the maximum amount available
at any time for drawing under such Letters of Credit (the "Maximum
Available Amount"), the Agent shall apply the amount then in the Cash
Collateral Account less the Maximum Available Amount immediately after
such cancellation, expiration or reduction, if any, first, to the cash
collateralization of the Letters of Credit if the Pledgor has failed to
pay all or a portion of the maximum amounts described in the first
sentence of this clause (ii) above, second, to the payment in full of
the outstanding Secured Obligations and third, the balance, if any, to
the Pledgor or as otherwise required by law.
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(iii) Interest and other income received in respect of
Investments of any amounts deposited in the Cash Collateral Account
pursuant to clause (ii) of this Section 2 shall be held by the Agent as
additional Collateral hereunder.
3. Pledge; Security for Secured Obligations.
----------------------------------------
The Pledgor hereby grants and pledges to the Agent, for itself and on behalf of
the Secured Parties, a first priority lien and security interest in the
Collateral now existing or hereafter arising or acquired, s collateral security
for the prompt payment in full when due, whether at stated maturity, by
acceleration or otherwise (including, without limitation, the payment of
interest and other amounts which would accrue and become due but for the filing
of a petition in bankruptcy or the operation of the automatic stay under Section
362(a) of the Bankruptcy Code), of all Secured Obligations.
4. Delivery of Collateral.
----------------------
The Collateral, when delivered to the Agent, for the benefit of the Lenders,
shall be in the form of immediately available funds.
5. Investing of Amounts in the Cash Collateral Account; Amounts held by the
------------------------------------------------------------------------
Agent.
------
Cash held by the Agent in the Cash Collateral Account shall not be invested or
reinvested except as provided in this Section 5.
(i) Subject to the remedies and other rights provided in
Section 11 hereof and provided that the lien and security interest in
favor of the Agent and Secured Parties remains perfected and so long as
no Event of Default shall have occurred and be continuing, any funds on
deposit in the Cash Collateral Account shall be invested by the Agent
in cash equivalents.
(ii) The Agent shall have no responsibility and the Pledgor
hereby agrees to hold the Agent and the Lenders harmless for any loss
in the value of the Collateral resulting from a fluctuation in interest
rates or otherwise. Any interest on Investments permitted hereunder and
the net proceeds of the sale or payment of any such Investments shall
constitute part of the Collateral and be held in the Cash Collateral
Account by the Agent.
6. Representations and Warranties.
-------------------------------
In addition to its representations and warranties made pursuant to Article VI of
the Credit Agreement, the Pledgor represents and warrants to the Agent (for
itself and as agent on behalf of the Lenders), that the following statements are
true, correct and complete:
(i) The Pledgor will be the legal and beneficial owner of the
Collateral free and clear of any Lien except for the lien and security
interest created by this Agreement;
(ii) The pledge and assignment of the Collateral pursuant to
this Agreement creates a valid and perfected first priority security
interest in the Collateral, securing the payment of the Secured
Obligations.
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7. Further Assurances.
--------------------
The Pledgor agrees that at any time and from time to time, at the Pledgor's
expense, the Pledgor will promptly execute and deliver to the Agent any further
instruments and documents, and take any further actions, that may be necessary
or that the Agent may reasonably request in order to perfect and protect any
security interest granted or purported to be granted hereby or to enable the
Agent to exercise and enforce its rights and remedies hereunder with respect to
any Collateral.
8. Transfers and Other Liens.
--------------------------
The Pledgor agrees that it will not (a) sell or otherwise dispose of any of the
Collateral, or (b) create or permit to exist any Lien upon or with respect to
any of the Collateral, except for the Lien and security interest created by this
Agreement and the Credit Agreement.
9. The Agent Appointed Attorney-in Fact.
---------------------------------------
Upon the occurrence and during the continuation of an Event of Default and
acceleration of the Obligations under the Credit Agreement, the Pledgor hereby
appoints the Agent as its attorney-in-fact, with full authority in the place and
stead of the Pledgor and in the name of the Pledgor or otherwise, from time to
time in the Agent's reasonable discretion to take any action and to execute any
instrument which the Agent may reasonably deem necessary or advisable to
accomplish the purposes of the Agreement, including, without limitation, to
receive, endorse and collect all instruments made payable to the Pledgor or
either of them representing any payment, dividend, or other distribution in
respect of the Collateral or any part thereof and to give full discharge for the
same. In performing its functions and duties under this Agreement, the Agent
shall act solely for the Secured Parties and the Agent has not assumed nor shall
be deemed to have assumed, other than as may be required by law, any obligation
towards or relationship of agency or trust with or for the Pledgor.
10. The Agent May Perform.
---------------------
If Pledgor fails to perform any agreement contained herein, after reasonable
notice to Pledgor, the Agent may itself perform, or cause performance of, such
agreement, and the reasonable expenses of the Agent incurred in connection
therewith shall be payable by Pledgor under Section 13 hereof.
11. Standard of Care; No Responsibility For Certain Matters.
-------------------------------------------------------
In dealing with the Collateral in its possession, the Agent shall exercise the
same care which it would exercise in dealing with similar collateral property
pledged by others in transactions of a similar nature, but it shall not be
responsible for (a) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Collateral, whether or not the Agent has or is deemed to have knowledge of such
matters, (b) taking any steps to preserve rights against any parties with
respect to any Collateral (other than steps taken in accordance with the
standard of care set forth above to maintain possession of the Collateral), (c)
the collection of any proceeds, (d) any loss resulting from Investments made
pursuant to Section 5 hereof, or (e) determining (x) the correctness of any
statement or calculation made by the Pledgor in any written instructions, or (y)
whether any deposit in the Cash Collateral Account is proper.
12. Remedies upon Default; Application of Proceeds.
----------------------------------------------
If the Pledgor shall fail to perform any action required hereunder or shall
otherwise breach any term or provision hereof (a "Default" hereunder which
K-4
Default shall not have been waived in accordance with Section 11.6 of the Credit
Agreement:
(i) The Agent may and shall at the request of the Required
Lenders exercise in respect of the Collateral, in addition to other
rights and remedies provided for herein otherwise available to it, all
the rights and remedies of a secured party on default under the Uniform
Commercial Code (the "Code") as in effect in the state in which the
Collateral is located at that time, and the Agent may, without notice
except as specified below, sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any exchange or
broker's board or at any of the Agent's offices or elsewhere, for cash,
on credit or for future delivery, and at such price or prices, and upon
such other terms as the Agent may deem commercially reasonable. Pledgor
agrees that, to the extent notice of sale shall be required by law, at
least ten (10) days' notice to Pledgor of the time and place of any
public sale or the time after which any private sale is to be made
shall constitute reasonable notification. The Agent shall not be
obligated to make any sale of the Collateral regardless of notice of
sale having been given. The Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(ii) In addition to the remedies set forth in part (i) above
and subject to the provisions of Section 2(ii) hereof, any cash held by
the Agent as Collateral and all cash proceeds received by the Agent in
respect of any sale of, collection from, or other realization upon all
or part of the Collateral shall be applied (after payment of any
amounts payable to the Agent pursuant to Section 12 hereof) by the
Agent to pay the Secured Obligations pursuant to Article IX of the
Credit Agreement.
13. Expenses.
--------
In addition to any payments of expenses of the Agent pursuant to the Credit
Agreement or the other Loan Documents, the Pledgor agrees to pay promptly to the
Agent all the costs and expenses, including reasonable attorneys fees and
expenses, which the Agent may incur in connection with (a) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Collateral, (b) the exercise or enforcement of any of the rights of the
Agent hereunder, or (c) the failure by the Pledgor to perform or observe any of
the provisions hereof, other than costs and expenses arising as a result of the
Agent's or a Lender's gross negligence or wilfull misconduct.
14. No Delays; Waiver, etc.
--------------------------
No delay or failure on the part of the Agent in exercising, and no course of
dealing with respect to, any power or right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Agent of any power or
right hereunder preclude other or further exercise thereof or the exercise of
any other power or right. The remedies herein provided are to the fullest extent
permitted by law cumulative and are not exclusive of any remedies provided by
law.
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15. Amendments, Etc.
---------------
No amendment, modification, termination or waiver of any provision of this
Agreement, or consent to any departure by the Pledgor therefrom, shall in any
event be effective without the written concurrence of the Agent.
16. Notices.
--------
Except as otherwise specifically provided herein, all notices which are to be
sent to the Pledgor or Agent shall be given in accordance with the Credit
Agreement.
17. Continuing Security Interest; Termination.
--------------------------------------------
This Agreement shall create a continuing security interest in the Collateral and
shall (a) remain in full force and effect until all Secured Obligations (other
than Secured Obligations in the nature of continuing indemnities or expense
reimbursement obligations not yet due and payable) shall have been indefeasibly
paid in full in cash, the commitments or other obligations of the Agent or any
Lender to make any Loan under the Credit Agreement shall have expired, the
Letters of Credit shall have expired and the Facility Termination Date shall
have occurred, (b) be binding upon Pledgor, its successors and assigns, and (c)
inure to the benefit of the Agent, the Secured Parties and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing clause (c) and subject to the provisions of the Credit Agreement, any
Lender may assign or otherwise transfer any Note held by it to any other person
or entity, and such other person or entity shall thereupon become vested with
all the benefits in respect thereof granted to such Lender herein or otherwise.
Upon the indefeasible payment in full in cash of the Secured Obligations (other
than Secured Obligations in the nature of continuing indemnities or expense
reimbursement obligations not yet due and payable), and the cancellation or
expiration of the Letters of Credit and termination or expiration of all
commitments and other obligations of the Agent and any Lender to make any Loan
and the occurrence of the Facility Termination Date, Pledgor shall be entitled,
subject to the provisions of Section 11 hereof, to the return, upon its request
and at its expense, of such of the Collateral as shall not have been sold or
otherwise applied pursuant to the terms hereof.
18. Successors and Assigns.
-------------------------
Whenever in this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of such party
and all covenants, promises, and agreements by or on behalf of the Pledgor or by
and on behalf of the Agent shall bind and inure to the benefit of the successors
and assigns of the Pledgor, the Agent and the Lenders.
19. Execution in Counterparts.
---------------------------
This Agreement may be executed in any number of counterparts and by the
different parties on separate counterparts and each such counterpart shall for
all purposes be deemed an original, but all such counterparts shall together
constitute but one and the same Agreement. The Pledgor and the Agent hereby
acknowledge receipt of a true, correct, and complete counterpart of this
Agreement.
20. Swap Agreements.
---------------
All Hedging Obligations of any Pledgor shall be deemed to be Secured Obligations
secured hereby, and each Lender or affiliate of a Lender party to any Swap
Agreement shall be deemed to be a Secured Party hereunder.
K-6
21. Severability.
------------
Any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such provision and such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
22. Headings.
--------
The section headings in this Agreement are inserted for convenience of reference
and shall not be considered a part of this Agreement or used in its
interpretation.
23. GOVERNING LAW; TERMS.
--------------------
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
(b) THE PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND
CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE
INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX
XXXX, XXXXX XX XXX XXXX, XXXXXX XXXXXX OF AMERICA AND, BY THE EXECUTION
AND DELIVERY OF THIS AGREEMENT, THE PLEDGOR EXPRESSLY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN,
OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY
SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND THE PLEDGOR
HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) THE PLEDGOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY
PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR
CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF THE PLEDGOR PROVIDED
IN SECTION 11.2 OF THE CREDIT AGREEMENT, OR BY ANY OTHER METHOD OF
SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE
OF NEW YORK.
(d) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS OR REMEDIES UNDER OR RELATED TO THIS AGREEMENT OR ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE
BE DELIVERED IN CONNECTION THEREWITH, THE PLEDGOR AND THE AGENT ON
K-7
BEHALF OF THE LENDERS HEREBY AGREE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO
THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE
TO TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING.
[Signatures on following pages]
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IN WITNESS WHEREOF, the Pledgor and the Agent have caused this Cash
Collateral Account Agreement to be duly executed and delivered by their
respective officers thereunto duly authorized as of the date first above
written.
DATA GENERAL CORPORATION
By:____________________________________
Name:__________________________________
Title:_________________________________
NATIONSBANK, NATIONAL ASSOCIATION,
as Agent for the Lenders
By:____________________________________
Name:__________________________________
Title:_________________________________
CASH COLLATERAL ACCOUNT AGREEMENT
Signature Page
EXHIBIT L
---------
Confidentiality Agreement
-------------------------
PROPRIETARY RIGHTS AND NONDISCLOSURE AGREEMENT
Non-Disclosure Agreement for the benefit of:
DATA GENERAL CORPORATION ("DGC")
0000 Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxxxx 00000
Reference is hereby made to that certain Credit Agreement dated as of
September 30, 1997 among DGC, the lenders party thereto (the "Lenders") and
NationsBank, National Association, as agent for the Lenders (as amended,
supplemented or replaced from time to time, the "Credit Agreement"). All
capitalized terms not otherwise defined herein shall have the meanings given to
such terms in the Credit Agreement.
1. The undersigned shall not disclose to any third party any Confidential
Information and shall keep confidential any Confidential Information, except
as provided in the next sentence, unless DGC has, in its sole discretion,
previously and expressly consented to such disclosure in writing. The
undersigned may disclose Confidential Financial Information to the extent
necessary to protect, exercise or enforce its rights or perform its
obligations under the Credit Agreement or as otherwise specifically permitted
pursuant to the terms of the Credit Agreement, or to (i) any of the
undersigned's directors, officers, employees, agents, accountants, attorneys,
auditors and advisors on a "need to know" and confidential basis pursuant to
this Agreement or terms equivalent, (ii) prospective participants or
prospective assignees on a confidential basis pursuant to this Agreement or
terms equivalent; (iii) examiners or regulatory agencies having supervisory
or examination authority over the undersigned; and (iv) any person pursuant
to the order of any governmental authority or as otherwise required by any
rule, regulation, law or judicial process, after giving DGC notice thereof
promptly after becoming aware of such requirement, to the extent such notice
would not be prohibited by law, regulation or such judicial process. The
undersigned may disclose Confidential Non-Financial Information to the extent
necessary to protect, exercise or enforce its rights or perform its
obligations under the Credit Agreement but only upon notice to DGC sufficient
to permit DGC to obtain such protective orders reasonably necessary to
prevent public disclose of such Non-Financial Information (and the
undersigned agrees not to oppose obtaining such protective orders where such
action is not reasonably likely to impair the rights or interests of the
undersigned) or as otherwise specifically permitted pursuant to the terms of
the Credit Agreement, or to (i) any of the undersigned's directors, officers,
employees, agents, accountants, attorneys, auditors and advisors on a "need
to know" and confidential basis pursuant to this Agreement or terms
equivalent, (ii) prospective participants or prospective assignees on a
confidential basis pursuant to this Agreement or terms equivalent; (iii)
examiners or regulatory agencies having supervisory or examination authority
over the undersigned requesting or requiring such disclosure; and (iv) any
person pursuant to the order of any governmental authority or as otherwise
required by any rules, regulation, law or judicial process, after giving DGC
notice thereof promptly after becoming aware of such requirement, to the
extent such notice would not be prohibited by law, regulation or such
judicial process.
"Confidential Information" means all Confidential Financial Information
and all Confidential Non-Financial Information.
"Confidential Financial Information" means all financial information
concerning DGC and its Affiliates which has been identified in good
faith by DGC as confidential and delivered to the undersigned by or on
behalf of DGC pursuant to this Agreement and which is not information
which is (a) in the public domain; (b) known to the undersigned at the
time of such disclosure without duty of confidentiality; (c)
subsequently received by the undersigned in good faith from a third
party who is not known to the undersigned to be bound by a
confidentiality agreement with DGC or known to the undersigned to be
otherwise prohibited from transmitting the information to the
undersigned by a contractual, legal or fiduciary obligation; (d)
independently generated by the undersigned; or (e) approved for release
or disclosure by DGC in a separate writing;
"Confidential Non-Financial Information" means all non-financial
information which has been identified in good faith by DGC as
confidential and relating to DGC and its Subsidiaries and its and their
trade-secrets, proprietary rights, operations and plans which has been
delivered to the undersigned by or on behalf of DGC pursuant to this
Agreement and which is not information which is (a) in the public
domain; (b) known to the undersigned at the time of such disclosure
without duty of confidentiality; (c) subsequently received by the
undersigned in good faith from a third party who is not known to the
undersigned to be bound by a confidentiality agreement with DGC or
known to the undersigned to be otherwise prohibited from transmitting
the information to the undersigned by a contractual, legal or fiduciary
obligation; (d) independently generated by the undersigned; or (e)
approved for release or disclosure by DGC in a separate writing;
2. The undersigned recognizes the proprietary rights of DGC in and to the
Confidential Information and/or the confidential nature of the Confidential
Information, and agrees to keep the Confidential Information as confidential
in accordance with its customary procedures for handling similar information
and with such care as is otherwise reasonable and treat the Confidential
Information as confidential to DGC, and to take appropriate action by
instruction, agreement or notice to its directors, officers, agent,
consultants, contractors and employees to notify them of the confidential and
proprietary nature of the Confidential Information submitted by DGC, and to
require that they conform to therequirements of this Agreement.
3. The undersigned further agrees that it will not make use of, either directly
or indirectly, any of the Confidential Information which it receives or has
received from DGC, other than for the purpose for which such Confidential
Information has been disclosed or in connection with the protection, exercise
or enforcement of its rights under the Loan Documents, except as otherwise
permitted hereunder or with the specific proper written authorization of an
officer of DGC.
4. This Agreement shall be governed by and construed in accordance with the laws
of the State of New York.
AGREED:
By:____________________________________
Its:___________________________________
Date:__________________________________
Schedule 6.4
------------
Borrower, Material and Significant Subsidiaries of Borrower
disclosed under Section 6.4:
-----------------------------------------------------------
Share Owned by Capitalization
Borrower or -----------------
Organizational Other Significant Class of
Name of Entity Form Subsidiaries Security Authorized Issued
-----------------------------------------------------------------------------------------------------------------
Borrower:
---------
Data General Delaware N/A Common 100M Approximately
Corporation corporation 48.8M
(including
220,653
treasury
shares)
Preferred 1M -0-
Material Subsidiaries
---------------------
Data General Delaware 100% Common
International, Inc. corporation
Datagen, Inc. Delaware 100% Common
corporation
Data General Investment Delaware 100% Common
Corporation corporation
Significant Subsidiaries
Those Subsidiaries listed in that letter from Borrower to Agent dated and
delivered contemporaneously with this Agreement.
Borrower Ownership Interests disclosed under Section 6.5:
-------------------------------------------------------------
Those investments listed in that letter from Borrower to Agent dated and
delivered contemporaneously with this Agreement.
Schedule 6.6
------------
Indebtedness
------------
1. $212,750,000 6% Convertible Subordinated Notes due 2004
2. That guarantee described in that letter from Borrower to Agent dated and
delivered contemporaneously with this Agreement.
SCHEDULE 6.7
------------
Liens
None.
SCHEDULE 8
----------
INVESTMENT GUIDELINES
---------------------
ISSUE/
RATING MINIMUM
TYPE OF INVESTMENT MAX PER MAXIMUM MAX % OF BANK RATING MIN.
XXXXX/S&P ACCOUNT ANK/ISSUE MATURITY PORTFOLIO MOOD/ S&P FUND
-----------------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Securities (OID only) (1) (2) BVI Unlimited 183 days 100% - - - - - - - -
U.S. Treasury Securities (1) DGC/DGIC Unlimited 1 Year 100% - - - - - - - -
U.S. Treasury Securities (1) DGC/DGIC Unlimited 2 Years 50% - - - - - - - -
U.S. Government Agencies (OID only) (2) BVI Unlimited 183 days 50% - - - - - - - -
U.S. Government Agencies DGC/DGIC Unlimited 1 Year 50% - - - - - - - -
Repurchase Agreements (3) (4) DGC/DGIC $10M 2 months 50% X0 X - - - -
Xxxxxxxxxx Agreements (3) DGC/DGIC $20M 3 Months 50% Aaa AAA - - - -
Bankers Acceptances (4) DGC/DGIC $10M 3 Months 50% A2 A - - - -
Bankers Acceptances DGC/DGIC $20M 6 Months 50% Aaa AAA - - - -
CD's(Dom/Euro/Yankee/Floating rate) (4) DGC/DGIC /BVI $10M 6 Months 50% A2 A - - - -
CD's(Dom/Euro/Yankee/Floating rate) DGC/DGIC /BVI $20M 1 Year 50% Aaa AAA - - - -
Time Deposits (Domestic, Euro) (4) DGC/DGIC /BVI $10M 3 Months 50% A2 A - - - -
Time Deposits (Domestic, Euro) DGC/DGIC /BVI $20M 6 Months 50% Aaa AAA - - - -
Corporate/Municipal Bonds (4) DGC/DGIC $10M 3 Months 50% - - - - A2 A
Corporate/Municipal Bonds DGC/DGIC $20M 6 Months 50% - - - - Aaa AAA
Commercial Paper DGC/DGIC $10M 1 Month 20% - - - - A1 P1
Commercial Paper DGC/DGIC $10M 3 Months 20% - - - - A1+ P1
Eurocommercial Paper BVI $10M 1 Month 20% - - - - A1 P1
Eurocommercial Paper BVI $10M 3 Months 20% - - - - A1+ P1
Money Market Fund (w/Facility Banks) DGC/DGIC $20M Daily 20% A3 A- Aaa AAA
Liquidity
Auction Preferreds and Notes DGC/DGIC $10M 2 Months 20% - - - - Aaa AAA
A minimum 50% of the domestic investment portfolio must be maintained in U.S. Treasuries.
BVI limits further restricted by Tax Department. OID = Original Issue Discount.
(1) With permitted institutions only and secured only by U.S. Treasury and Agency collateral at 102%
Xxxx to Market plus accrued interest: (subject to investment criteria on banks).
(2) $10M limit for Credit Facility Banks with a bank rating of A3/A-.
