CREDIT AGREEMENT
By and Among
THE CASUAL MALE, INC.,
TCM HOLDING CO., INC.,
WGS CORP.,
TCMB&T, INC.,
X. XXXXX, INC.,
FLEET NATIONAL BANK AS ADMINISTRATIVE AGENT,
BANKBOSTON, N.A. AS DOCUMENTATION AGENT,
AND
THE OTHER LENDERS WHICH ARE OR MAY BECOME PARTIES HERETO
WITH
FLEET AND BANCBOSTON SECURITIES, INC. AS ARRANGERS
Dated: May 30, 1997
TABLE OF CONTENTS
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Compliance Certificate
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Loan Request
SCHEDULES
Schedule 1 - Lending Institutions
Schedule 2 - Definitions and Rules of Interpretation
Schedule 4.8 - Existing Letters of Credit
Schedule 7.2 - Ownership Interests
Schedule 7.4 - Owned Assets not listed on Balance Sheet
Schedule 7.5 - Contingent Liabilities
Schedule 7.8 - Litigation
Schedule 7.15 - Permitted Transactions
Schedule 8.17 - Corporate Overhead
Schedule 9.1 - Permitted Indebtedness
Schedule 9.2 - Permitted Liens
Schedule 9.3 - Permitted Investments
CREDIT AGREEMENT
This CREDIT AGREEMENT is made as of the 30th day of May, 1997, by and
among THE CASUAL MALE, INC. ("Casual Male"), TCM HOLDING CO., INC. ("TCM"), WGS
CORP. ("WGS") and TCMB&T, INC. ("TCMB&T" and, together with Casual Male, TCM and
WGS, the "Borrowers" and each, singularly, a "Borrower") and X. XXXXX, INC. (the
"Guarantor"), each a Massachusetts corporation, except for TCM which is a
Delaware corporation, and each having its principal place of business at 000
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or 00 Xxxxxxx Xxxxxx, Xxxx Xxxx,
Xxxxxxxxxxxxx 00000, FLEET NATIONAL BANK ("Fleet"), BANKBOSTON, N.A.
("BankBoston") and the other lending institutions listed on Schedule 1 attached
hereto (collectively, the "Lenders"), Fleet as Administrative Agent for itself
and the other Lenders (in such capacity, the "Administrative Agent") and
BankBoston as Documentation Agent for itself and the other Lenders (in such
capacity, the "Documentation Agent").
ss. DEFINITIONS AND RULES OF INTERPRETATION.
ss. Definitions.
Except as otherwise expressly provided herein, all capitalized terms
used in this Credit Agreement, the exhibits hereto and any notes, certificates,
reports or other documents or instruments made or delivered pursuant to or in
connection with this Credit Agreement shall have the meanings set forth for such
terms in Schedule 2 hereto.
ss.1.2 Rules of Interpretation.
Except as otherwise expressly provided herein, the rules of
interpretation set forth in Schedule 2 hereto shall apply to this Credit
Agreement, the exhibits hereto and any notes, certificates, reports or other
documents or instruments made or delivered pursuant to or in connection with
this Credit Agreement.
ss. THE REVOLVING CREDIT FACILITY.
ss. Commitment to Lend.
Subject to the terms and conditions set forth in this Credit
Agreement, each of the Lenders severally agrees to lend to the Borrowers and the
Borrowers may borrow, repay, and reborrow from time to time between the Closing
Date and the Maturity Date upon notice by the Borrowers to the Administrative
Agent given in accordance with ss.2.7, such sums as are requested by the
Borrowers up to a maximum aggregate amount outstanding (after giving effect to
all amounts requested) at any one time
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equal to such Lender's Commitment minus such Lender's Commitment Percentage of
the sum of the Maximum Drawing Amount, the Acceptance Face Amount and all Unpaid
Reimbursement Obligations; provided that the outstanding aggregate amount of all
Loans (after giving effect to all amounts requested) plus the Maximum Drawing
Amount, plus the Acceptance Face Amount, plus all Unpaid Reimbursement
Obligations shall not at any time exceed the Total Commitment. The Loans shall
be made pro rata in accordance with each Lender's Commitment Percentage. Each
request for a Loan hereunder shall constitute a representation and warranty by
the Obligors that the conditions set forth in ss.11 and ss.12, in the case of
the initial Loans to be made on the Closing Date, and ss.12, in the case of all
other Loans, have been satisfied on the date of such request.
ss. Facility Fee.
The Borrowers agree to pay to the Administrative Agent for the
respective accounts of the Lenders in accordance with their respective
Commitment Percentages a facility fee on the Total Commitment, whether used or
unused, at a rate per annum equal to the Facility Fee Rate. The facility fee
shall be payable quarterly in arrears on the first day of each calendar quarter
for the immediately preceding calendar quarter (or portion thereof) commencing
on the first such date following the date hereof, with a final payment on the
later of the (a) Maturity Date and (b) the date the Obligations are paid in
full. The facility fee provided in this Section shall accrue at all times after
the Closing Date (including at any time during which one or more of the
conditions in ss.12 are not met), until the later of the (a) Maturity Date and
(b) the date on which the Total Commitment is no longer in effect and the
Obligations shall have been paid in full; provided, however, that after the
Maturity Date the facility fee shall be calculated at the Facility Fee Rate on
the outstanding principal amount of the Loans plus any Unpaid Reimbursement
Obligations; and further provided, that in no event shall the continued accrual
of the facility fee after the Maturity Date be construed as a waiver of the
absolute and unconditional obligations of the Borrowers to repay the Obligations
in full on the Maturity Date.
ss. Voluntary Reduction of Total Commitment.
The Borrowers shall have the right at any time and from time to time
upon five (5) Business Days' prior written notice to the Administrative Agent to
reduce by $1,000,000 or any greater integral multiple thereof or terminate
entirely the Total Commitment, whereupon the Commitments of the Lenders shall be
reduced pro rata in accordance with their respective Commitment Percentages of
the amount specified in such notice or, as the case may be, terminated. Promptly
after receiving any notice from the Borrowers delivered pursuant to this ss.2.3,
the Administrative Agent will notify the Lenders of the substance thereof. Upon
the effective date of any such reduction or termination, the Borrowers shall pay
to the Administrative Agent for the respective accounts of the Lenders the full
amount of any facility fee then accrued on the amount of the reduction. No
reduction or termination of the Commitments may be reinstated.
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ss. Mandatory Reduction of Total Commitment.
On each of the dates set forth in the table below (each such date
being hereinafter referred to as a "Commitment Reduction Date"), the Total
Commitment shall be automatically reduced by the amount (the"Reduction Amount")
set forth opposite such date in the column headed "Reduction Amount"
set forth below, to the amount set forth opposite such date in the column headed
"Total Commitment" set forth below:
Date Reduction Amount Total Commitment
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December 31, 1997 $10,000,000 $90,000,000
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December 31, 1998 $12,500,000 $77,500,000
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December 31, 1999 $12,500,000 $65,000,000
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ss. The Notes.
The Loans shall be evidenced
by separate promissory notes of the Borrowers in substantially the form of
Exhibit A hereto (each a "Note"), dated as of the Closing Date and completed
with appropriate insertions. One Note shall be payable to the order of each
Lender in a principal amount equal to such Lender's Commitment or, if less, the
outstanding amount of all Loans made by such Lender, plus interest accrued
thereon, as set forth below. Each Borrower irrevocably authorizes each Lender to
make or cause to be made, at or about the time of the Drawdown Date of any Loan
or at the time of receipt of any payment of principal on such Lender's Note, an
appropriate notation on such Lender's Note Record reflecting the making of such
Loan or (as the case may be) the receipt of such payment. The outstanding amount
of the Loans set forth on such Lender's Note Record shall be prima facie
evidence, absent manifest error, of the principal amount thereof owing and
unpaid to such Lender, but the failure to record, or any error in so recording,
any such amount on such Lender's Note Record shall not limit or otherwise affect
the obligations of the Borrowers hereunder or under any Note to make payments of
principal of or interest on any Note when due.
ss. Interest on Loans.
Except as otherwise provided in ss.5.10,
Each Base Rate Loan shall bear interest for the period commencing with the
Drawdown Date thereof and ending on the last day of the Interest Period with
respect thereto at the rate of the Base Rate from time to time in effect plus
the Applicable Margin.
Each LIBOR Rate Loan shall bear interest for the period commencing with the
Drawdown Date thereof and ending on the last day of the Interest Period with
respect thereto at the rate of the LIBOR Rate determined for such Interest
Period plus the Applicable Margin.
The Borrowers promise to pay interest on each Loan in arrears on each Interest
Payment Date with respect thereto.
ss. Requests for Loans.
The Borrowers shall give to the Administrative Agent written notice
in the form of Exhibit D hereto (or telephonic notice confirmed in a writing in
the form of Exhibit D hereto) of each Loan requested hereunder (a "Loan
Request") (a) not later than 1:00 p.m., Boston time, on the Business Day of the
proposed Drawdown Date of any Base Rate Loan and (b) not less than three (3) and
not more than five (5) LIBOR Business Days prior to the proposed Drawdown Date
of any LIBOR Rate Loan. Each such notice shall specify (i) the principal amount
of the Loan requested, (ii) the proposed Drawdown Date of such Loan, (iii) the
Interest Period for such Loan and (iv) the Type of such Loan. Promptly upon
receipt of any such notice, the Administrative Agent shall notify each of the
Lenders thereof. Each Loan Request shall be irrevocable and binding on each
Borrower and shall obligate the Borrowers to accept the Loan requested from the
Lenders on the proposed Drawdown Date. Each Loan Request shall be in a minimum
aggregate amount of $1,000,000 or a larger integral multiple of $100,000
thereof.
ss. Conversion Options.
The Borrowers may elect from time to time to convert any
outstanding Loan to a Loan of another Type, provided that (i) with respect to
any such conversion of a Loan to a Base Rate Loan, the Borrowers shall give the
Administrative Agent not less than one (1) and not more than five (5) Business
Days' prior written notice of such election; (ii) with respect to any such
conversion of a Base Rate Loan to a LIBOR Rate Loan, the Borrowers shall give
the Administrative Agent no less than three (3) and not more than five (5) LIBOR
Business Days' prior written notice of such election; (iii) with respect to any
such conversion of a LIBOR Rate Loan into a Loan of another Type, such
conversion shall only be made on the last day of the Interest Period with
respect thereto and (iv) no Loan may be converted into a LIBOR Rate Loan when
any Default or Event of Default has occurred and is continuing. On the date on
which such conversion is being made each Lender shall take such action as is
necessary to transfer its Commitment Percentage of such Loans to its Domestic
Lending Office or its LIBOR Lending Office, as the case may be. All or any part
of outstanding Loans of any Type may be converted into a Loan of another Type as
provided herein, provided that (i) any partial conversion shall be in an
aggregate principal amount of $1,000,000 or a larger integral multiple of
$100,000. Each Conversion Request relating to the conversion of a Loan to a
LIBOR Rate Loan shall be irrevocable by the Borrowers and (ii) with respect to
LIBOR Rate Loans, there shall be no more than six (6) separate Interest Periods
in effect at any one time.
Any Loan of any Type may be continued as a Loan of the same Type upon
the expiration of an Interest Period with respect thereto by compliance by the
Borrowers with the notice provisions contained in ss.2.8(a); provided that no
LIBOR Rate Loan may be continued as such when any Default or Event of Default
has occurred and is continuing, but shall be automatically converted to a Base
Rate Loan on the last day of the first Interest Period relating thereto ending
during the continuance of any Default or Event of Default of which officers of
the Administrative Agent active upon the Borrowers' account have actual
knowledge. The Administrative Agent shall notify the Lenders promptly when any
such automatic conversion contemplated by this ss.2.8 is scheduled to occur.
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Any conversion to or from LIBOR Rate Loans shall be in such amounts and
be made pursuant to such elections so that, after giving effect thereto, the
aggregate principal amount of all LIBOR Rate Loans having the same Interest
Period shall not be less than $1,000,000 or a whole multiple of $100,000 in
excess thereof.
ss. Funds for Loans.
Not later than 2:00 p.m. (Boston, Massachusetts time) on the proposed Drawdown
Date of any Loan, each of the Lenders will make available to the Administrative
Agent, at the Administrative Agent's Head Office, in immediately available
funds, the amount of such Lender's Commitment Percentage of the amount of the
requested Loans. Upon receipt from each Lender of such amount, and upon receipt
of the documents required by (i) ss.ss.11 and 12 in the case of initial Loans,
and (ii) ss.12 for all other Loans, and the satisfaction of the other conditions
set forth therein, to the extent applicable, the Administrative Agent will make
available to the Borrowers the aggregate amount of such Loans made available to
the Administrative Agent by the Lenders. The failure or refusal of any Lender to
make available to the Administrative Agent at the aforesaid time and place on
any Drawdown Date the amount of such Lender's Commitment Percentage of the
requested Loans shall not relieve any other Lender from its several obligation
hereunder to make available to the Administrative Agent the amount of such other
Lender's Commitment Percentage of any requested Loans.
The Administrative Agent may, unless notified to the contrary by any Lender
prior to a Drawdown Date, assume that such Lender has made available to the
Administrative Agent on such Drawdown Date the amount of such Lender's
Commitment Percentage of the Loans to be made on such Drawdown Date, and the
Administrative Agent may (but it shall not be required to), in reliance upon
such assumption, make available to the Borrowers a corresponding amount. If any
Lender makes available to the Administrative Agent such amount on a date after
such Drawdown Date, such Lender shall pay to the Administrative Agent on demand
an amount equal to the product of (i) the average, computed for the period
referred to in clause (iii) below, of the weighted average interest rate paid by
the Administrative Agent for federal funds acquired by the Administrative Agent
during each day included in such period, times (ii) the amount of such Lender's
Commitment Percentage of such Loans, times (iii) a fraction, the numerator of
which is the number of days that elapse from and including such Drawdown Date to
the date on which the amount of such Lender's Commitment Percentage of such
Loans shall become immediately available to the Administrative Agent, and the
denominator of which is 365. A statement of the Administrative Agent submitted
to such Lender with respect to any amounts owing under this paragraph shall be
prima facie evidence of the amount due and owing to the Administrative Agent by
such Lender. If the amount of such Lender's Commitment Percentage of such Loans
is not made available to the Administrative Agent by such Lender within three
(3) Business Days following such Drawdown Date, the Administrative Agent shall
be entitled to recover such amount from the Borrowers on demand, with interest
thereon at the rate per annum applicable to the Loans made on such Drawdown
Date.
ss. REPAYMENT OF THE REVOLVING CREDIT LOANS.
ss. Maturity.
The Borrowers absolutely and unconditionally and jointly and
severally promise to pay on the Maturity Date, and there shall become absolutely
due and payable on the Maturity Date, all of the Loans outstanding on such date,
together with any and all accrued and unpaid interest thereon and all fees and
6
reasonable expenses incurred by the Lenders and Agents in connection therewith
and payable by the Borrowers hereunder.
ss. Mandatory Repayments of Loans.
If at any time the outstanding amount of the Loans, the Maximum
Drawing Amount, the Acceptance Face Amount and all Unpaid Reimbursement
Obligations exceeds an amount equal to the Total Commitment, then the Borrowers
shall immediately pay the amount of such excess to the Administrative Agent for
the respective accounts of the Issuing Bank, the Acceptance Bank and the Lenders
for application: first, to any Unpaid Reimbursement Obligations; second, to the
Loans; and third, to provide to the Administrative Agent cash collateral for
Reimbursement Obligations as contemplated by ss.4.3(b) and (c). Each payment of
any Unpaid Reimbursement Obligations or prepayment of Loans shall be allocated
among the Issuing Bank, the Acceptance Bank and the Lenders, in proportion, as
nearly as practicable, to each Reimbursement Obligation or (as the case may be)
the respective unpaid principal amount of each Lender's Note, with adjustments
to the extent practicable to equalize any prior payments or repayments not
exactly in proportion.
ss. Optional Repayments of Loans.
The Borrowers shall have the right, at their election, to repay the
outstanding amount of the Loans, as a whole or in part, at any time without
penalty or premium, provided that any full or partial prepayment of the
outstanding amount of any LIBOR Rate Loans pursuant to this ss.3.3 may be made
only on the last day of the Interest Period relating thereto. The Borrowers
shall give the Administrative Agent, no later than 2:00 p.m., Boston time, on
the date of the proposed prepayment prior telephonic notice (with such notice to
be confirmed in writing by the Borrowers) of any proposed prepayment pursuant to
this ss.3.3 of Base Rate Loans, and not less than three (3) and not more than
five (5) LIBOR Business Days' notice of any proposed prepayment pursuant to this
ss.3.3 of LIBOR Rate Loans, in each case specifying the proposed date of
prepayment of Loans and the principal amount to be prepaid. Each such partial
prepayment of the Loans shall be in a minimum amount of $1,000,000 or a larger
integral multiple of $100,000, and shall be applied, in the absence of
instruction by the Borrowers, first to the principal of Base Rate Loans and then
to the principal of LIBOR Rate Loans. Each partial prepayment shall be allocated
among the Lenders, in proportion, as nearly as practicable, to the respective
unpaid principal amount of each Lender's Note, with adjustments to the extent
practicable to equalize any prior repayments not exactly in proportion.
ss. LETTERS OF CREDIT AND BANKERS' ACCEPTANCES.
ss. Letter of Credit Commitments.
Subject to the terms and conditions hereof and the execution
and delivery by the Borrowers of a letter of credit application on the Issuing
Bank's customary form (a "Letter of Credit Application"), the Issuing Bank on
behalf of the Lenders and in reliance upon the agreement of the Lenders set
forth in ss.4.1(d) and upon the representations and warranties of the Obligors
contained herein, agrees, in its individual capacity, to issue, extend and renew
for the account of the Borrowers one or more standby or documentary letters of
credit (individually, a "Letter of Credit"), in such form as may be requested
from time to time by the Borrowers and agreed to by the Issuing Bank; provided,
however, that, after giving effect to such request, (i) the sum of the aggregate
Maximum Drawing Amount and all Unpaid Reimbursement Obligations shall not exceed
$25,000,000 at any one time and (ii) the sum of (A)
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the Maximum Drawing Amount of all Letters of Credit, (B) all Unpaid
Reimbursement Obligations, (C) the Acceptance Face Amount, and (D) the principal
amount of all Loans outstanding shall not exceed the Total Commitment, and
further provided, (x) no standby Letter of Credit shall have an expiry date
later than the date which is one year from the issuance thereof, and (y) no
documentary Letter of Credit shall have any expiry date which is later than the
date which is one hundred and eighty (180) days after the issuance thereof.
Upon receipt of a Letter of Credit Application, the Issuing
Bank shall notify the Administrative Agent by telephone of such application to
determine that after giving effect to the issuance of the requested Letter of
Credit (and the Administrative Agent will make reasonable efforts to reply as
promptly as is practicable to such notification), (i) the sum of the aggregate
Maximum Drawing Amount and all Unpaid Reimbursement Obligations shall not exceed
$25,000,000 at any one time and (ii) the sum of (A) the Maximum Drawing Amount
of all Letters of Credit, (B) all Unpaid Reimbursement Obligations, (C) the
Acceptance Face Amount, and (D) the principal amount of all Loans outstanding
shall not exceed the Total Commitment. Additionally, each Lender which is
designated by the Borrowers as an Issuing Bank, the Borrowers and the
Administrative Agent shall negotiate in good faith to establish additional
written procedures with respect to the issuance of Letters of Credit to reduce
the risk that Letters of Credit will be issued which would cause (i) the sum of
the aggregate Maximum Drawing Amount and all Unpaid Reimbursement Obligations to
exceed $25,000,000 at any one time and (ii) the sum of (A) the Maximum Drawing
Amount of all Letters of Credit, (B) all Unpaid Reimbursement Obligations, (C)
the Acceptance Face Amount, and (D) the principal amount of all Loans
outstanding to exceed the Total Commitment. Notwithstanding the foregoing, the
Borrowers acknowledge that it is the unconditional obligation of the Borrowers
to ensure that at no time shall (i) the sum of the aggregate Maximum Drawing
Amount and all Unpaid Reimbursement Obligations exceed $25,000,000 at any one
time and (ii) the sum of (A) the Maximum Drawing Amount of all Letters of
Credit, (B) all Unpaid Reimbursement Obligations, (C) the Acceptance Face
Amount, and (D) the principal amount of all Loans outstanding does not exceed
the Total Commitment, and that if at any time there shall be a failure to comply
with the foregoing, the Borrowers shall be required to immediately comply with
ss.3.2.
Each Letter of Credit Application shall be completed to the
satisfaction of the Issuing Bank. In the event that any provision of any Letter
of Credit Application shall be inconsistent with any provision of this Credit
Agreement, then the provisions of this Credit Agreement shall, to the extent of
any such inconsistency, govern.
Upon notification of such Letter of Credit Application by the
Issuing Bank, the Administrative Agent shall notify each Lender of its pro rata
participation interest in the Letter of Credit to be issued. Each Letter of
Credit issued, extended or renewed hereunder shall, among other things, (i)
provide for the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (ii) have an expiry date no later than the date which is
twenty (20) days (or, if the beneficiary is located outside of the United States
of America, thirty (30) days) prior to the Maturity Date. Each Letter of Credit
so issued, extended or renewed shall be subject to the Uniform Customs.
Each Lender severally agrees that it shall be absolutely
liable, without regard to the occurrence of any Default or Event of Default or
any other condition precedent whatsoever, to the extent of such Lender's
Commitment Percentage, to reimburse the Issuing Bank on demand for the amount of
each draft paid by the Issuing Bank under each Letter of Credit to the extent
that such amount is not
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reimbursed by the Borrowers pursuant to ss.4.3 (such agreement for a Lender
being called herein the "Letter of Credit Participation" of such Lender).
Each such payment made by a Lender shall be treated as the
purchase by such Lender of a participating interest in the Borrowers'
Reimbursement Obligation under ss.4.3 in an amount equal to such payment. Each
Lender shall share in accordance with its participating interest in any interest
which accrues pursuant to ss.4.3.
ss. Bankers' Acceptance Facility.
Subject to the terms and conditions set forth in this Credit Agreement
and the execution by the Borrowers of an Acceptance Agreement in the Acceptance
Bank's customary form (the "Acceptance Agreement"), upon the written request of
the Borrowers, the Acceptance Bank, on behalf of the Lenders, and in reliance
upon the agreement of the Lenders set forth in ss.4.2(b) hereof and upon the
representations and warranties of the Borrowers contained herein, agrees, in its
individual capacity, to discount Eligible Drafts for the account of the
Borrowers (all such accepted and discounted Eligible Drafts whether heretofore
or hereafter issued being referred to individually as a "Bankers' Acceptance"
and collectively as the "Bankers' Acceptances"); provided, however, that (i) any
Bankers' Acceptance issued shall provide for a maturity date not longer than one
hundred and twenty (120) days; (ii) in no event shall such maturity extend
beyond the Maturity Date; (iii) after giving effect to such request, the sum of
(A) the Maximum Drawing Amount (B) the Acceptance Face Amount, (C) all Unpaid
Reimbursement Obligations, and (D) the amount of any Loans outstanding shall not
exceed the Total Commitment; and (iv) the Acceptance Bank shall not accept an
Eligible Draft if the face amount of all outstanding drafts accepted by the
Acceptance Bank which are of the type described in paragraph 7 of Section 13 of
the Federal Reserve Act (12 U.S.C. ss.372), as amended from time to time, or any
successor statute, would cause the Acceptance Bank to violate any limitation
imposed upon it under said paragraph or would cause the Acceptance Bank to
violate such limitation if all such drafts were sold by the Acceptance Bank in
the secondary market. To expedite the acceptance and discounting of Eligible
Drafts, the Borrowers shall provide to the Acceptance Bank fully executed
drafts, which shall be blank as to dates and amounts. The Borrowers may request
the Acceptance Bank to accept and discount an Eligible Draft by submitting to
the Acceptance Bank at least one (1) Business Day prior to the proposed date of
acceptance and discounting a bankers' acceptance application in the Acceptance
Bank's customary form, completed to the satisfaction of the Acceptance Bank and
accompanied by such documents as may be required by the Acceptance Bank to
establish that the drafts to be accepted and discounted will (if accepted and
endorsed by a member bank of the Federal Reserve System) be eligible for
discount by such Federal Reserve Bank. The Acceptance Bank shall make available
to the Borrowers at the time of acceptance of each Eligible Draft and upon the
satisfaction of the conditions set forth in ss.11 (but only in the case of the
first Loan or Credit Instrument to be made or issued hereunder) and ss.12
hereof, an amount equal to the discounted value of such Eligible Draft based on:
(x) the stated maturity date of such Eligible Draft, (y) the face amount of such
Eligible Draft, and (z) a rate (computed on the basis of a year of three hundred
sixty (360) days for the actual days elapsed) equal to the sum of (a) the per
annum average discount rate quoted to the Acceptance Bank on the day an Eligible
Draft is presented for discount by the Acceptance Bank's bankers' acceptance
traders for acceptances which are of the type described in paragraph 7 of
section 13 of the Federal Reserve Act (12 U.S.C. ss.372), as amended from time
to time, or any successor statute and which approximate the face amount and
mature on the maturity date of such Eligible Draft plus (b) the Applicable
Commission (the "Bankers Acceptance Fee").
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Upon receipt of such bankers' acceptance application, the
Acceptance Bank shall notify the Administrative Agent by telephone of such
application to determine that after giving effect to the issuance of the
requested bankers' acceptance (and the Administrative Agent will make reasonable
efforts to reply as promptly as is practicable to such notification), the sum of
(A) the Maximum Drawing Amount (B) the Acceptance Face Amount, (C) all Unpaid
Reimbursement Obligations, and (D) the amount of any Loans outstanding shall not
exceed the Total Commitment. Additionally, each Lender which is designated by
the Borrowers as an Acceptance Bank, the Borrowers and the Administrative Agent
shall negotiate in good faith to establish additional written procedures with
respect to the issuance of Bankers' Acceptance to reduce the risk that Bankers'
Acceptances will be issued which would cause (i) the sum of the aggregate
Maximum Drawing Amount and all Unpaid Reimbursement Obligations to exceed
$25,000,000 at any one time and (ii) the sum of (A) the Maximum Drawing Amount
of all Letters of Credit, (B) all Unpaid Reimbursement Obligations, (C) the
Acceptance Face Amount, and (D) the principal amount of all Loans outstanding to
exceed the Total Commitment. Notwithstanding the foregoing, the Borrowers
acknowledge that it is the unconditional obligation of the Borrowers to ensure
that at no time shall (i) the sum of the aggregate Maximum Drawing Amount and
all Unpaid Reimbursement Obligations exceed $25,000,000 at any one time and (ii)
the sum of (A) the Maximum Drawing Amount of all Letters of Credit, (B) all
Unpaid Reimbursement Obligations, (C) the Acceptance Face Amount, and (D) the
principal amount of all Loans outstanding the Total Commitment does not exceed
the Total Commitment and that if at any time there shall be a failure to comply
with the foregoing, the Borrowers shall be required to immediately comply with
ss.3.2.
Upon notification of such bankers' acceptance application by the
Acceptance Bank, the Administrative Agent shall notify each Lender of its pro
rata share of the Bankers' Acceptance. Subject to the terms and conditions
hereof, each Lender severally agrees that it shall participate in any Bankers'
Acceptances upon notification by the Administrative Agent that the Acceptance
Bank has received an application for acceptance and discounting of an Eligible
Draft in form and substance satisfactory to the Acceptance Bank and the
Administrative Agent. The Acceptance Bank agrees to furnish the Administrative
Agent and each of the Lenders a copy of each Bankers' Acceptance promptly after
issuance. Each Lender severally agrees that it shall be absolutely liable,
without regard to the occurrence of any Default or Event of Default or any other
condition precedent whatsoever to the extent of such Lender's Commitment
Percentage, to reimburse the Acceptance Bank on demand for the amount of each
draft paid by the Acceptance Bank under each Bankers' Acceptance to the extent
such amount is not reimbursed by the Borrowers pursuant to ss.4.3 hereof (such
amount for a Lender being called herein the "Bankers' Acceptance Participation"
of such Lender).
Each such payment made by a Lender shall be treated as the purchase by
such Lender of a participating interest in the Borrowers' Reimbursement
Obligation under ss.4.3 hereof in an amount equal to such payment. Each Lender
shall share in accordance with its participating interest in any interest which
accrues pursuant to ss.4.3 hereof.
In addition to Acceptance Bank's normal discount of Bankers'
Acceptances, the Borrowers shall pay to the Administrative Agent, for the
accounts of the Acceptance Bank and the Lenders in accordance with their
respective Commitment Percentages, a commission (the "Applicable Commission")
for each Bankers' Acceptance issued pursuant to this Credit Agreement at an
annual rate on the face amount of each Bankers' Acceptance equal to the
Applicable Margin for LIBOR Rate Loans on the face amount of each such Bankers'
Acceptance.
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ss. Reimbursement Obligation of the Borrowers.
In order to induce the Acceptance Bank and the Issuing Bank to issue,
extend and renew each Credit Instrument and the Lenders to participate therein,
the Borrowers hereby agree to reimburse or pay to the Acceptance Bank and the
Issuing Bank, for the account of the Acceptance Bank, the Issuing Bank or the
Lenders (as the case may be), with respect to each Credit Instrument issued,
extended or renewed by the Acceptance Bank or the Issuing Bank hereunder,
except as otherwise expressly provided in ss.4.3(b) and (c),
on each date that any draft presented under such Letter of Credit is
honored by the Issuing Bank, or the Issuing Bank otherwise makes a
payment with respect thereto, or, in the case of Bankers' Acceptances,
on the maturity date of such Bankers' Acceptances, (i) the amount paid
by the Issuing Bank under or with respect to such Letter of Credit,
and, with respect to the Bankers' Acceptances, the amount of such
Bankers' Acceptances then maturing, and (ii) the amount of any taxes,
fees, charges or other costs and expenses whatsoever incurred by the
Acceptance Bank, the Issuing Bank or any Lender in connection with any
payment made by the Acceptance Bank or the Issuing Bank under, or with
respect to, such Credit Instruments,
upon the reduction (but not termination) of the Total
Commitment to an amount less than the Maximum Drawing Amount plus the
Acceptance Face Amount, plus all unpaid Reimbursement Obligations, an
amount equal to such difference, which amount shall be held by the
Acceptance Bank or the Issuing Bank (as the case may be) for the
benefit of the Lenders, the Acceptance Bank and the Issuing Bank as
cash collateral for all Reimbursement Obligations, and
upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all
Credit Instruments in accordance with ss.15, an amount equal to the
then Maximum Drawing Amount on all Letters of Credit, plus the
Acceptance Face Amount, which amount shall be held by the Acceptance
Bank or the Issuing Bank (as the case may be) for the benefit of the
Lenders, the Acceptance Bank and the Issuing Bank as cash collateral
for all Reimbursement Obligations.
Each such payment shall be made to the Acceptance Bank or the Issuing
Bank (as the case may be) at the Acceptance Bank's or the Issuing Bank's head
office in immediately available funds. Interest on any and all amounts remaining
unpaid by the Borrowers under this ss.4.3 at any time from the date such amounts
become due and payable (whether as stated in this ss.4.3, by acceleration or
otherwise) until payment in full (whether before or after judgment) shall be
payable to Acceptance Bank or the Issuing Bank on demand at the rate specified
in ss.5.10 for overdue principal on the Loans.
ss. Credit Instrument Payments.
If any draft shall be presented or other demand for payment shall be
made under any Letter of Credit, the Issuing Bank shall notify the Borrowers of
the date and amount of the draft presented or demand for payment and of the date
and time when it expects to pay such draft or honor such demand for payment. If
the Borrowers fail to reimburse the Issuing Bank as provided in ss.4.3 on or
before the date that such draft is paid or other payment is made by the Issuing
Bank, or, with respect to Bankers' Acceptances, if the Borrowers fail to
reimburse the Acceptance Bank upon the maturity of such Bankers' Acceptances,
the Issuing Bank or the Acceptance Bank may at any time thereafter notify the
Lenders of the amount of any such Unpaid Reimbursement Obligation. No later than
3:00 p.m. (Boston time) on
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the Business Day next following the receipt of such notice, each Lender shall
make available to the Issuing Bank or the Acceptance Bank (as the case may be),
at its head office, in immediately available funds, such Lender's Commitment
Percentage of such Unpaid Reimbursement Obligation, together with an amount
equal to the product of (a) the average, computed for the period referred to in
clause (c) below, of the weighted average interest rate paid by the Issuing Bank
for federal funds acquired by the Issuing Bank or the Acceptance Bank during
each day included in such period, times (b) the amount equal to such Lender's
Commitment Percentage of such Unpaid Reimbursement Obligation, times (c) a
fraction, the numerator of which is the number of days that elapse from and
including the date the Issuing Bank or the Acceptance Bank paid the draft
presented for honor or otherwise made payment to the date on which such Lender's
Commitment Percentage of such Unpaid Reimbursement obligation shall become
immediately available to the Issuing Bank, and the denominator of which is 360.
The responsibility of the Issuing Bank and the Acceptance Bank to the Borrowers
and the Lenders shall be only to determine that the documents (including each
draft) delivered under each Credit Instrument in connection with such
presentment shall be in conformity in all material respects with such Credit
Instrument.
ss. Obligations Absolute.
The Borrowers' obligations under this ss.4 shall be joint and several
and absolute and unconditional under any and all circumstances and irrespective
of the occurrence of any Default or Event of Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which any Borrower
may have or have had against the Issuing Bank, the Acceptance Bank any Lender or
any beneficiary of a Credit Instrument. Each of the Borrowers further agrees
with the Issuing Bank, the Acceptance Bank and the Lenders that the Issuing
Bank, the Acceptance Bank and the Lenders shall not be responsible for, and the
Borrowers' Reimbursement Obligations under ss.4.3 shall not be affected by,
among other things, the validity or genuineness of documents or of any
endorsements thereon, even if such documents should in fact prove to be in any
or all respects invalid, fraudulent or forged, or any dispute between or among
the Borrowers, the beneficiary of any Credit Instrument or any financing
institution or other party to which any Credit Instrument may be transferred or
any claims or defenses whatsoever of the Borrowers against the beneficiary of
any Credit Instrument or any such transferee, provided, however, that the
Acceptance Bank or the Issuing Bank acts in good faith and in compliance with
all applicable foreign and domestic laws. The Acceptance Bank, the Issuing Bank
and the Lenders shall not be liable for any error, omission, interruption or
delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Credit Instrument. Each of the Borrowers
agrees that any action taken or omitted by the Acceptance Bank, the Issuing Bank
or any Lender under or in connection with each Credit Instrument and the related
drafts and documents, if done in good faith and in compliance with all
applicable foreign and domestic laws, shall be binding upon the Borrowers and
shall not result in any liability on the part of the Acceptance Bank, the
Issuing Bank or any Lender to the Borrowers. Notwithstanding the foregoing, the
Borrowers shall not be required to indemnify any Lender, the Acceptance Bank or
the Issuing Bank for any claims, damages, losses, liabilities, costs or expenses
to the extent that a court of competent jurisdiction makes a final unappealable
determination that such claims, damages, losses, liabilities, costs or expenses
were caused by (i) the willful misconduct or gross negligence of the Acceptance
Bank or Issuing Bank in determining whether a request presented under any Credit
Instrument complied with the terms of such Credit Instrument or (ii) the
Acceptance Bank or the Issuing Bank's bad faith failure to pay under any Credit
Instrument after the presentation of it to of a request strictly complying with
the terms and conditions of such Credit Instrument.
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ss. Reliance by Issuer.
To the extent not inconsistent with ss.4.5, the Acceptance Bank or
the Issuing Bank shall be entitled to rely, and shall be fully protected in
relying upon, any Credit Instrument, draft, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Acceptance Bank or the Issuing
Bank. The Acceptance Bank or the Issuing Bank shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Majority Banks as it
reasonably deems appropriate or it shall first be indemnified to its reasonable
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Acceptance Bank and the Issuing Bank shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement in accordance with a
request of the Majority Banks, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Lenders and all future holders
of the Notes or of a Credit Instrument Participation.
ss. Letter of Credit Fee.
(a) The Borrowers shall, on the date of issuance or any extension or
renewal of any Letter of Credit and at such other time or times as such charges
are customarily made by the Issuing Bank, pay a fee (in each case, a "Letter of
Credit Fee") to the Issuing Bank (a) annually in advance (with the first such
payment due upon the issuance thereof and thereafter on each successive
anniversary that such Letter of Credit is outstanding) in respect of each
standby Letter of Credit, an amount equal to the Applicable Margin for LIBOR
Rate Loans then in effect per annum multiplied by the Maximum Drawing Amount of
such standby Letter of Credit plus (i) the Issuing Bank's customary issuance
fee, and (ii) a fronting fee to the Issuing Bank equal to one-quarter of one
percent (0.25%) per annum on the Maximum Drawing Amount of such standby Letter
of Credit; and (b) in respect of each documentary Letter of Credit a negotiation
fee equal to one-quarter of one percent (0.25%) of the face amount of such
documentary Letter of Credit payable upon presentation plus the Issuing Bank's,
customary issuance fee, such Letter of Credit Fee (but not such issuance,
amendment, fronting or negotiation fee) to be for the accounts of the Lenders in
accordance with their respective Commitment Percentages. Amounts paid by the
Borrowers in respect of Letter of Credit Fees shall be non-refundable.
Notwithstanding the foregoing, if there is a reduction in the Maximum Drawing
Amount of any Letter of Credit (other than commercial or documentary Letters of
Credit), the Borrowers will receive on a per diem basis a pro-rata refund of the
fees (excluding any fronting fee or customary issuance fee) paid in connection
with such Letter of Credit as set forth in this ss.4.7.
(b) With respect to all fees payable by the Borrowers to the Issuing
Bank for the account of the Lenders hereunder, the Issuing Bank will, at the end
of each month, deliver to the Administrative Agent, for the account of the
Lenders, all fees paid by the Borrowers to the Issuing Bank during such month.
Promptly after its receipt of such fees, the Agent will distribute to each
Lender, to the extent of such Lender's Commitment Percentage therein, all such
fees paid to the Agent by the Issuing Bank. In the event that the Issuing Bank
makes a refund of fees to the Borrowers pursuant to ss.4.7(a), and upon the
Lenders' receipt of notice of such refund by the Issuing Bank, each of the
Lenders will promptly make available to the Issuing Bank, at its head office, in
immediately available funds, such Lender's
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Commitment Percentage of any such refunded fees; provided, however, that the
Lenders shall not be required to reimburse the Issuing Bank for their respective
Commitment Percentage for any refund to the extent that the Issuing Bank has
not, on the date the Borrowers have received a refund of fees, delivered the
fees in question to the Administrative Agent for distribution to the Lenders
pursuant to the provisions of this clause (b).
ss.
Existing Letters of Credit.
The Borrowers and the Lenders agree that the letters of credit
described on Schedule 4.8 hereto (the "Existing Letters of Credit"), which
Existing Letters of Credit have previously been issued by Fleet or its
affiliates either (a) for the account of the Borrowers, or (b) for the account
of one or more affiliates of the Borrowers, shall be deemed Letters of Credit
issued under and governed by this Credit Agreement, that this Credit Agreement
supersedes any and all prior agreements between the Borrowers and Fleet with
respect to the Existing Letters of Credit, and that all the Existing Letters of
Credit shall be subject to and governed by the terms of this Credit Agreement.
As to the letters of credit referred to in clause (b) of the preceding sentence,
the Borrowers acknowledge that (i) although the account parties for each of such
letters of credit were affiliates of the Borrowers, each of such letters of
credit was issued exclusively to secure payment obligations of one or more of
the Borrowers to trade vendors or to otherwise finance the working capital needs
of the Borrowers, (ii) the reimbursement of the issuer or issuers thereof for
drawings upon each of such letters of credit was unconditionally guaranteed by
the Borrowers, which guarantee obligations continue to be in full force and
effect as of and until the time that this Agreement is being executed, and (iii)
as between the Borrowers and the affiliates that were the account parties with
respect to each of such letters of credit, it has been agreed that the Borrowers
shall be obligated to reimburse the issuers thereof for any drawings thereon.
ss. CERTAIN GENERAL PROVISIONS.
ss. Agents' Fees.
The Borrowers shall pay to the Agents the fees set forth in the Fee Letter.
ss. Funds for Payments.
All payments of principal, interest, Reimbursement
Obligations, facility fees, Letter of Credit Fees and any other amounts due
hereunder or under any of the other Loan Documents shall be made to the
Administrative Agent, for the respective accounts of the Lenders, the Acceptance
Bank, the Issuing Bank and the Agents, as the case may be, at such location that
the Administrative Agent may from time to time designate, in each case in
Dollars in immediately available funds.
All payments by the Borrowers hereunder and under any of the
other Loan Documents shall be made without setoff or counterclaim and free and
clear of and without deduction for any taxes, levies, imposts, duties, charges,
fees, deductions, withholdings, compulsory loans, restrictions or conditions of
any nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein unless the
Borrowers are compelled by law to make such deduction or withholding. If any
such obligation is imposed upon the Borrowers with respect to any amount payable
by it hereunder or under any of the other Loan Documents, the Borrowers will
14
pay to the Administrative Agent, for the account of the Lenders or (as the case
may be) the Administrative Agent, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such additional amount in
Dollars as shall be necessary to enable the Lenders or the Administrative Agent
to receive the same net amount which the Lenders or the Administrative Agent
would have received on such due date had no such obligation been imposed upon
the Borrowers. The Borrowers will deliver promptly to the Administrative Agent
certificates or other valid vouchers for all taxes or other charges deducted
from or paid with respect to payments made by the Borrowers hereunder or under
such other Loan Document.
ss. Computations.
All computations of interest on the Loans and of facility fees,
Bankers' Acceptance Fees, Letter of Credit Fees or other fees shall, unless
otherwise expressly provided herein, be based on a 360-day year and paid for the
actual number of days elapsed. Except as otherwise provided in the definition of
the term "Interest Period" with respect to LIBOR Rate Loans, whenever a payment
hereunder or under any of the other Loan Documents becomes due on a day that is
not a Business Day, the due date for such payment shall be extended to the next
succeeding Business Day, and interest shall accrue during such extension. The
outstanding amount of the Loans as reflected on the Note Records from time to
time shall be considered prima facie evidence, absent manifest error, of the
principal amount thereof owing and unpaid to such Lender unless within five (5)
Business Days after receipt of any notice by the Administrative Agent or any of
the Lenders of such outstanding amount, the Administrative Agent or such Lender
shall notify the Borrowers to the contrary.
ss. Inability to Determine LIBOR Rate.
In the event, prior to the commencement of any Interest Period
relating to any LIBOR Rate Loan, the Administrative Agent shall determine in
good faith or be notified by the Majority Lenders in good faith that adequate
and reasonable methods do not exist for ascertaining the LIBOR Rate that would
otherwise determine the rate of interest to be applicable to any LIBOR Rate Loan
during any Interest Period, the Administrative Agent shall forthwith give notice
of such determination (which shall be conclusive and binding on the Borrowers
and the Lenders) to the Borrowers and the Lenders. In such event (a) any Loan
Request or Conversion Request with respect to LIBOR Rate Loans shall be
automatically withdrawn and shall be deemed a request for Base Rate Loans, (b)
each LIBOR Rate Loan will automatically, on the last day of the then current
Interest Period relating thereto, become a Base Rate Loan, and (c) the
obligations of the Lenders to make LIBOR Rate Loans shall be suspended until the
Administrative Agent or the Majority Lenders determines that the circumstances
giving rise to such suspension no longer exist, whereupon the Administrative
Agent shall so notify the Borrowers and the Lenders.
ss. Illegality.
Notwithstanding any other provisions herein, if any present or
future law, regulation, treaty or directive or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
LIBOR Rate Loans, such Lender shall forthwith give notice of such circumstances
to the Borrowers and the other Lenders and thereupon (a) the commitment of such
Lender to make LIBOR Rate Loans or convert Loans of another Type to LIBOR Rate
Loans shall forthwith be suspended and (b) such Lender's Loans then outstanding
as LIBOR Rate Loans, if any, shall be converted automatically to Base Rate Loans
on the last day of each Interest Period applicable to such LIBOR Rate Loans or
within such
15
earlier period as may be required by law. The Borrowers hereby agree promptly to
pay the Administrative Agent for the account of such Lender, upon demand by such
Lender, any additional amounts necessary to compensate such Lender for any costs
incurred by such Lender in making any conversion in accordance with this ss.5.5,
including any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its LIBOR Loans hereunder.
ss. Additional Costs, Etc.
If any future applicable law or any change in any present law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court or by any governmental or
other regulatory body or official charged with the administration or the
interpretation thereof and requests, directives, instructions and notices at any
time or from time to time hereafter made upon or otherwise issued to any Lender
or the Administrative Agent by any central bank or other fiscal, monetary or
other authority (whether or not having the force of law), shall:
subject any Lender, the Agents, the Acceptance Bank or the
Issuing Bank to any tax, levy, impost, duty, charge, fee, deduction or
withholding of any nature with respect to this Credit Agreement, the other Loan
Documents, any Credit Instrument, such Lender's Commitment, Loans or Credit
Instrument Participations (other than taxes based upon or measured by the income
or profits of such Lender, the Administrative Agent, the Acceptance Bank or the
Issuing Bank), or
materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Lender of the principal of or the
interest on any Loans or Credit Instrument Participation or any other amounts
payable to any Lender, the Agents, the Acceptance Bank or the Issuing Bank under
this Credit Agreement or any of the other Loan Documents, or
impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or letters of credit issued by,
or commitments of an office of any Lender, the Acceptance Bank or the Issuing
Bank, or
impose on any Lender, the Agents, the Acceptance Bank or the
Issuing Bank any other conditions or requirements with respect to this Credit
Agreement, the other Loan Documents, any Credit Instrument, the Loans, such
Lender's Commitment or Credit Instrument Participations, or any class of loans,
letters of credit, bankers' acceptances or commitments of which any of the Loans
or such Lender's Commitment or Credit Instrument Participation forms a part, and
the result of any of the foregoing is
(i) to increase the cost to the Acceptance
Bank or the Issuing Bank or any Lender of making,
funding, issuing, renewing, extending or maintaining
any of the Loans or such Lender's Commitment, any
Credit Instrument or any Credit Instrument
Participation, or
(ii) to reduce the amount of principal,
interest, Reimbursement Obligation or other amount
payable to such Lender, the Agents, the Acceptance
Bank or the Issuing Bank hereunder on account of such
Lender's Commitment, any Credit Instrument, any of
the Loans or any Credit Instrument Participation, or
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(iii) to require such Lender, the Agents,
the Acceptance Bank or the Issuing Bank to make any
payment or to forego any interest or Reimbursement
Obligation or other sum payable hereunder, the amount
of which payment or foregone interest or
Reimbursement Obligation or other sum is calculated
by reference to the gross amount of any sum
receivable or deemed received by such Lender, the
Agents, the Acceptance Bank or the Issuing Bank from
the Borrowers hereunder,
then, and in each such case, the Borrowers will, upon demand made by such
Lender, the Agents, the Acceptance Bank or the Issuing Bank (as the case may be)
at any time and from time to time and as often as the occasion therefor may
arise, pay to such Lender, the Agents, the Acceptance Bank or the Issuing Bank
such additional amounts as will be sufficient to compensate such Lender, the
Agent, the Acceptance Bank or the Issuing Bank for such additional cost,
reduction, payment or foregone interest or Reimbursement Obligation or other
sum.
ss. Capital Adequacy.
If after the date hereof the Acceptance Bank, the Issuing Bank, any
Lender or the Administrative Agent determines that (a) the adoption of or change
in any law, governmental rule, regulation, policy, guideline or directive
(whether or not having the force of law) regarding capital requirements for
banks or bank holding companies or any change in the interpretation or
application thereof by a court or governmental authority with appropriate
jurisdiction, or (b) compliance by the Acceptance Bank, the Issuing Bank or such
Lender or any corporation controlling the Acceptance Bank, the Issuing Bank or
such Lender with any law, governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law) of any such entity regarding
capital adequacy, has the effect of reducing the return on such Lender's
Commitment, Loans or Credit Instrument Participation to a level below that which
the Acceptance Bank, the Issuing Bank or such Lender could have achieved but for
such adoption, change or compliance (taking into consideration the Acceptance
Bank, the Issuing Bank's or such Lender's then existing policies with respect to
capital adequacy and assuming full utilization of such entity's capital) by any
amount deemed by the Acceptance Bank, the Issuing Bank or such Lender to be
material, then the Acceptance Bank, the Issuing Bank or such Lender may notify
the Borrowers of such fact. To the extent that the amount of such reduction in
the return on capital is not reflected in the Base Rate (if relating to Loans or
Unpaid Reimbursement Obligations) or the Bankers' Acceptance Fee (if relating to
the Bankers' Acceptances), the Borrowers, the Acceptance Bank, the Issuing Bank
or such Lender shall thereafter attempt to negotiate in good faith an adjustment
to the compensation payable hereunder which will adequately compensate such
lender for such reduction. If the Borrowers, the Acceptance Bank, the Issuing
Bank or such Lender are unable to agree to such adjustment within thirty (30)
days of the day on which the Borrowers receive such notice, then the fees
payable hereunder shall increase by an amount which will, in the Acceptance
Bank's, the Issuing Bank's or such Lender's reasonable determination, be
sufficient to compensate the Acceptance Bank, the Issuing Bank or the such
Lender for the amount of such reduction in the return on capital as and when
such reduction is evidenced by calculations, in reasonable detail, presented by
the Acceptance Bank, the Issuing Bank or such Lender of a certificate in
accordance with ss.5.8 hereof. The Acceptance Bank, the Issuing Bank and each
Lender shall allocate such cost increases among its customers in good faith and
on an equitable basis.
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ss. Certificate.
The Agents, the Acceptance Bank, the Issuing Bank or the Lenders
shall provide to the Borrowers a certificate setting forth any additional
amounts payable pursuant to ss.ss.5.6 or 5.7 and a brief explanation of such
amounts which are due, and such certificate shall be conclusive, absent manifest
error, that such amounts are due and owing.
ss. Indemnity.
Each Borrower agrees to indemnify each Lender and to hold each
Lender harmless from and against any loss, cost or expense (including loss of
anticipated profits) that such Lender may sustain or incur as a consequence of
(a) default by the Borrowers in payment of the principal amount of or any
interest on any LIBOR Rate Loans as and when due and payable, including any such
loss or expense arising from interest or fees payable by such Lender to lenders
of funds obtained by it in order to maintain its LIBOR Rate Loans, (b) default
by the Borrowers in making a borrowing or conversion after the Borrowers have
given (or is deemed to have given) a Loan Request, notice or a Conversion
Request relating thereto in accordance with ss.2.7 or ss.2.8 or (c) the making
of any payment of a LIBOR Rate Loan or the making of any conversion of any such
Loan to a Base Rate Loan on a day that is not the last day of the applicable
Interest Period with respect thereto, including interest or fees payable by such
Lender to lenders of funds obtained by it in order to maintain any such Loans.
ss. Interest After Default.
Overdue principal and (to the extent permitted by applicable law)interest on the
Loans and all other overdue amounts payable hereunder or under any of the other
Loan Documents shall bear interest compounded monthly and payable on demand at a
rate per annum equal to three percent (3%) above the Base Rate from time to time
in effect plus the Applicable Margin until such amount shall be paid in full
(after as well as before judgment).
During the continuance of any Event of Default the principal of the Loans not
overdue or any other amounts payable under any of the other Loan Documents
shall, until such Event of Default has been cured or remedied or such Event of
Default has been waived by the Majority Lenders pursuant to ss.27, bear interest
at a rate per annum equal to the rate of interest applicable to overdue
principal pursuant to ss.5.10(a) hereof.
ss. Concerning Joint and Several Liability of the Borrowers.
Each of the Borrowers is accepting joint and several liability
hereunder in consideration of the financial accommodations to be provided by the
Agents, the Acceptance Bank, the Issuing Bank and the Lenders under this
Agreement, for the mutual benefit, directly and indirectly, of each of the
Borrowers and in consideration of the undertakings of each of the Borrowers to
accept joint and several liability for the obligations of each of them.
Each of the Borrowers, jointly and severally, hereby
irrevocably and unconditionally accepts, not merely as a surety but also as a
co-debtor, joint and several liability with each other Borrower, with respect to
the payment and performance of all of the Obligations, it being the intention of
the parties hereto that all the Obligations shall be the joint and several
obligations of all of the Borrowers without preferences or distinction among
them.
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If and to the extent that any of the Borrowers shall fail to
make any payment with respect to any of the Obligations as and when due or to
perform any of such Obligations in accordance with the terms thereof, then in
each such event each other Borrower will make such payment with respect to, or
perform, such Obligation.
The obligations of each Borrower under the provisions of this
ss.5.11 constitute the absolute and unconditional obligations of such Borrower
enforceable against it to the full extent permitted under the terms hereof,
irrespective of the validity, regularity or enforceability of this Agreement or
any other circumstance whatsoever.
Except as otherwise expressly provided for herein, each
Borrower hereby waives notice of acceptance of its joint and several liability,
notice of the Loans made under this Agreement, notice of the occurrence of any
Default or Event of Default, or of any demand for any payment under this
Agreement, notice of any action at any time taken or omitted by the Agent, the
Acceptance Bank, the Issuing Bank or the Lenders under or in respect of any of
the Obligations, any requirement of diligence or to mitigate damages and,
generally, all demands, notices and other formalities of every kind in
connection with this Agreement. Each Borrower hereby assents to, and waives
notice of, any extension or postponement of the time for the payment of any of
the Obligations, the acceptance of any partial payment thereon, any waiver,
consent or other action or acquiescence by the Agent, the Acceptance Bank, the
Issuing Bank or the Lenders at any time or times in respect of any default by
any Obligor in the performance or satisfaction of any term, covenant, condition
or provision of this Agreement, any and all other indulgences whatsoever by the
Agent, the Acceptance Bank, the Issuing Bank or the Lenders in respect of any of
the obligations hereunder, and the taking, addition, substitution or release, in
whole or in part, at any time or times, of any security for any of such
obligations or the addition, substitution or release, in whole or in part, of
any Obligor. Without limiting the generality of the foregoing, each Borrower
assents to any other action or delay in acting or failure to act on the part of
the Agent, the Acceptance Bank, the Issuing Bank or the Lenders including,
without limitation, any failure strictly or diligently to assert any right or to
pursue any remedy or to comply fully with applicable laws or regulations
thereunder, which might, but for the provisions of this ss.5.11, afford grounds
for terminating, discharging or relieving such Borrower, in whole or in part,
from any of its Obligations under this ss.5.11, it being the intention of each
Borrower that, so long as any of the Obligations remain unsatisfied, the
Obligations of such Borrower under this ss.5.11 shall not be discharged except
by performance and then only to the extent of such performance. The joint and
several liability of the Borrowers hereunder shall continue in full force and
effect notwithstanding any absorption, merger, amalgamation or any other change
whatsoever in the name, membership, constitution or place of formation of any
Obligor or the Agent, the Acceptance Bank, the Issuing Bank or the Lenders. If
at any time, any payment, or any part thereof, made in respect of any of the
Obligations, is rescinded or must otherwise be restored or returned by the
Agent, the Acceptance Bank, the Issuing Bank or the Lenders upon the insolvency,
bankruptcy or reorganization of any of the Obligors, or otherwise, the
provisions of this ss.5.11 will forthwith be reinstated in effect, as though
such payment had not been made.
ss. Interest.
In no event shall the amount of interest due or payable
hereunder or under the Notes exceed the maximum rate of interest allowed by
applicable law and, in the event any such payment is inadvertently made by the
Borrowers or inadvertently received by the Administrative Agent, the Acceptance
Bank, the Issuing Bank or any Lender, then such excess sum shall be credited as
a payment of principal, unless the Borrowers shall notify the Administrative
Agent, the Acceptance Bank, the Issuing
19
Bank or such Lender in writing that it elects to have such excess returned
forthwith. It is the express intent hereof that the Borrowers not pay and none
of the Administrative Agent, the Acceptance Bank, the Issuing Bank or the
Lenders receive, directly or indirectly in any manner whatsoever, interest in
excess of that which may legally be paid by the Borrowers under applicable law.
Notwithstanding the use by the Lenders of the Base Rate and
the LIBOR Rate as reference rates for the determination of interest on the
Loans, the Lenders shall be under no obligation to obtain funds from any
particular source in order to charge interest to the Borrowers at interest rates
related to such reference rates.
ss. COLLATERAL SECURITY.
The Obligations shall be secured by a perfected first priority
security interest in all of the issued and outstanding capital stock of each
Borrower pursuant to the terms of the Security Documents.
ss. REPRESENTATIONS AND WARRANTIES.
Each Apparel Obligor represents and warrants to the Lenders, the
Agents, the Acceptance Bank and the Issuing Bank as follows:
ss. Corporate Authority; Ownership.
Incorporation; Good Standing. Each Apparel Obligor (i) is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation, (ii) has all requisite corporate power to own its
property and conduct its business as now conducted and as presently
contemplated, and (iii) is in good standing as a foreign corporation and is duly
authorized to do business in each jurisdiction where a failure to be so
qualified would have a materially adverse effect on the business, assets or
financial condition of such Apparel Obligor.
Authorization. The execution, delivery and performance of this
Credit Agreement and the other Loan Documents to which each Apparel Obligor is
or is to become a party, and the performance by each such Person of all of its
agreements and obligations under each of such documents, and the transactions
contemplated hereby and thereby (i) are within the corporate authority of each
such Person, (ii) have been duly authorized by all necessary corporate
proceedings, (iii) do not conflict with or result in any breach or contravention
of any provision of law, statute, rule or regulation to which any Apparel
Obligor is subject or any judgment, order, writ, injunction, license or permit
applicable to such Person, (iv) do not conflict with any provision of the
corporate charter or bylaws of, any agreement or other instrument binding upon,
or trust agreement of, such Person and (v) do not require any approval, consent,
order, authorization or license by, or giving notice to, or taking any other
action with respect to, any governmental or regulatory authority or agency under
any provision of any applicable law.
Enforceability. The execution and delivery of this Credit
Agreement and the other Loan Documents to which each Apparel Obligor is or is to
become a party will result in valid and legally binding obligations of such
Person enforceable against such Person in accordance with the respective terms
and provisions hereof and thereof, except as enforceability is limited by
bankruptcy, insolvency,
20
reorganization, moratorium or other laws relating to or affecting generally the
enforcement of creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding therefor may be brought.
ss. No Business Activity; Subsidiaries.
Except as set forth on Schedule 7.2, or as a result of transactions
occurring after the Closing Date permitted by ss.9.3 and ss.9.5, no Apparel
Obligor owns or holds of record and/or beneficially (whether directly or
indirectly) any shares of any class in the capital of any other corporations or
any legal and/or beneficial interests in any corporation, partnership, limited
liability company, business trust or joint venture or in any other
unincorporated trade or business enterprise (excluding certain immaterial
investments having a value not exceeding $50,000).
ss. Governmental Approvals.
The execution, delivery and performance by each of the Apparel
Obligors of any of the Loan Documents to which any such Apparel Obligors is or
is to become a party and the transactions contemplated hereby and thereby do not
require the approval or consent of, or filing with, any governmental agency or
authority other than those already obtained. Each of the Apparel Obligors holds
all material licenses, permits and other certificates required for the operation
of its business. Each of the Apparel Obligors is in compliance in all material
respects with all applicable state and Federal filing and operating
requirements, including all regulations governing equal employment opportunity.
ss. Title to Properties; Leases.
Except as indicated on Schedule 7.4 hereto, the Apparel Obligors own
all of the assets reflected in the balance sheets of the Apparel Obligors as at
the Balance Sheet Date or acquired since that date (except property and assets
sold or otherwise disposed of in the ordinary course of business since that date
or Permitted Dispositions), subject to no rights of others, including any
mortgages, leases, conditional sales agreements, title retention agreements,
liens or other encumbrances except Permitted Liens.
ss. Financial Statements.
There has been furnished to each of the Lenders consolidated
and consolidating balance sheets of the Guarantor and its Subsidiaries as at
February 1, 1997 and the consolidated and consolidating statements of income and
cash flow of the Guarantor and its Subsidiaries, each for the fiscal year then
ended, in each case audited and certified by KPMG Peat Marwick. Such balance
sheets and statements of income and cash flow of the Guarantor and their
Subsidiaries shall have been prepared in accordance with generally accepted
accounting principles and fairly present the financial condition of the
Guarantor and their Subsidiaries as at the close of business on the date thereof
and the results of operations for the fiscal year then ended. Except as set
forth on Schedule 7.5, there are no contingent liabilities of the Guarantor as
of such date involving material amounts (other than guaranties of obligations of
Borrowers), known to the officers of such Person, which were not disclosed in
such balance sheets and the notes related thereto.
21
There has been furnished to each of the Lenders an unaudited
combined balance sheet of the Borrowers and combined statements of income and
cash flow of the Borrowers, each as at the Balance Sheet Date. Such balance
sheet and statements of income and cash flow shall have been prepared in
accordance with generally accepted accounting principles (except for the absence
of footnotes) and fairly present the financial condition of the Borrowers as at
the close of business on the date thereof. Except as set forth on Schedule 7.5,
there are no contingent liabilities of any Borrower or any of its Subsidiaries
as of such date involving material amounts which were not disclosed in such
balance sheets of the Borrowers or the notes related thereto.
ss. No Material Changes, Etc.
Except as set forth on Schedule 7.6, since the Balance Sheet Date
there has occurred no materially adverse change in the financial condition or
business of any Apparel Obligor as shown on or reflected in the balance sheets
of the Apparel Obligors as at the Balance Sheet Date, or the statements of
income and cash flow for the fiscal year then ended, other than changes in the
ordinary course of business that have not had any materially adverse effect
either individually or in the aggregate on the business or financial condition
of the Apparel Obligors.
ss. Franchises, Patents, Copyrights, Etc.
The Apparel Obligors possess all material franchises, patents,
copyrights, trademarks, trade names, licenses and permits, and rights in respect
of the foregoing, adequate for the conduct of their respective businesses
substantially as now conducted without known conflict with any rights of others.
ss. Litigation.
Except as set forth on Schedule 7.8, there are no actions, suits,
proceedings or investigations of any kind pending or, to the best knowledge of
the Obligors after due inquiry, threatened against any Apparel Obligor or before
any court, tribunal or administrative agency or board that, if adversely
determined, would likely, either in any case or in the aggregate, materially
adversely affect the properties, assets, financial condition or business of any
Apparel Obligor or materially impair the right of any Apparel Obligor to carry
on business substantially as now conducted by them, or result in any material
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the combined balance sheet of the Apparel Obligors, or
which question the validity of this Credit Agreement or any of the other Loan
Documents or any action taken or to be taken pursuant hereto or thereto.
ss. No Materially Adverse Contracts, Etc.
None of the Apparel Obligors are subject to any charter, corporate
or other legal restriction, or any judgment, decree, order, rule or regulation
that has or is expected in the future to have a materially adverse effect on the
business, assets or financial condition of any of such Persons. None of the
Apparel Obligors are a party to any contract or agreement that has or is
expected to have any materially adverse effect on the business of any of such
Persons.
ss. Compliance with Other Instruments, Laws, Etc.
22
None of the Apparel Obligors are in material violation of any
provision of their respective charter documents, bylaws, or any agreement or
instrument to which any of them may be subject or by which any of them or any of
their properties may be bound or any decree, order, judgment, statute, license,
rule or regulation, in any of the foregoing cases in a manner that could result
in the imposition of material penalties or materially and adversely affect the
financial condition, properties or business of any of such Persons.
ss. Tax Status.
The Guarantor and each of its Subsidiaries (a) has made or filed all
federal income tax returns, reports and declarations and, has made or filed all
state and other tax returns, reports and declarations required by any
jurisdiction to which any of them is subject (to the extent that any failure to
make or file any such tax returns, reports and declarations would have,
individually or in the aggregate, a materially adverse effect on the financial
condition, properties or business of any such Person), (b) has paid all taxes
and other governmental assessments and charges shown or determined to be due on
such returns, reports and declarations, except those being contested in good
faith and by appropriate proceedings and (c) has set aside on its books
provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and to the best knowledge of each Obligor after
due and diligent inquiry, there is no basis for any such claim.
ss. No Event of Default.
No Default or Event of Default has occurred and is continuing.
ss. Holding Company and Investment Company Acts.
None of the Apparel Obligors are a "holding company", or a
"subsidiary company" of a "holding company", or an affiliate" of a "holding
company", as such terms are defined in the Public Utility Holding Company Act of
1935; nor are any of them an "investment company", or an "affiliated company" or
a "principal underwriter" of an "investment company", as such terms are defined
in the Investment Company Act of 1940.
ss. Absence of Financing Statements, Etc.
To the best of the Apparel Obligors' knowledge, except with respect
to Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future lien on, or security interest
in, any assets or property owned by any Apparel Obligor or any rights relating
thereto.
ss. Certain Transactions.
Except as set forth on Schedule 7.15, none of the officers,
directors, or employees of any of the Apparel Obligors is presently a party to
any material transaction with any Apparel Obligor (other than for services as
employees, officers and directors or for management services), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any officer, director
23
or such employee or, to the knowledge of the Apparel Obligors, any corporation,
partnership, trust or other entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner.
ss. Employee Benefit Plans.
In General. Each Employee Benefit Plan and each Guaranteed
Pension Plan has been maintained and operated in compliance in all material
respects with the provisions of ERISA and, to the extent applicable, the Code,
including but not limited to the provisions thereunder respecting prohibited
transactions and the bonding of fiduciaries and other persons handling plan
funds as required by ss.412 of ERISA. Each Obligor has heretofore delivered to
the Administrative Agent, when requested by the Administrative Agent, the most
recently completed annual report, Form 5500, with all required attachments, and
actuarial statement required to be submitted under ss.103(d) of ERISA, with
respect to each Guaranteed Pension Plan.
Terminability of Welfare Plans. No Employee Benefit Plan,
which is an employee welfare benefit plan within the meaning of ss.3(1) or
ss.3(2)(B) of ERISA, provides benefit coverage subsequent to termination of
employment, except as required by Title I, Part 6 of ERISA or the applicable
state insurance laws. The Obligors may terminate each such Plan at any time (or
at any time subsequent to the expiration of any applicable bargaining agreement)
in the discretion of the Obligors without liability to any Person other than for
claims arising prior to termination.
Guaranteed Pension Plans. Each contribution required to be
made to a Guaranteed Pension Plan, whether required to be made to avoid the
incurrence of an accumulated funding deficiency, the notice or lien provisions
of ss.302(f) of ERISA, or otherwise, has been timely made. No waiver of an
accumulated funding deficiency or extension of amortization periods has been
received with respect to any Guaranteed Pension Plan, and neither the Obligors
nor any ERISA Affiliate is obligated to or has posted security in connection
with an amendment to a Guaranteed Pension Plan pursuant to ss.307 of ERISA or
ss.401(a)(29) of the Code. No liability to the PBGC (other than required
insurance premiums, all of which have been paid) has been incurred by any
Obligor, or any ERISA Affiliate with respect to any Guaranteed Pension Plan and
there has not been any ERISA Reportable Event (other than an ERISA Reportable
Event as to which the requirement of thirty (30) days notice has been waived),
or any other event or condition which presents a material risk of termination of
any Guaranteed Pension Plan by the PBGC. Based on the latest valuation of each
Guaranteed Pension Plan, and on the actuarial methods and assumptions employed
for that valuation, the aggregate benefit liabilities of all such Guaranteed
Pension Plans determined on an ongoing funding basis (and not on a termination
basis) did not exceed the aggregate value of the assets of all such Guaranteed
Pension Plans, disregarding for this purpose the benefit liabilities and assets
of any Guaranteed Pension Plan with assets in excess of benefit liabilities.
Multiemployer Plans. No Obligor or any ERISA Affiliate has
incurred any material liability (including secondary liability) to any
Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan under ss.4201 of ERISA or as a result of a sale of assets
described in ss.4204 of ERISA. No Obligor or any ERISA Affiliate has been
notified that any Multiemployer Plan is in reorganization or insolvent under and
within the meaning of ss.4241 or ss.4245 of ERISA or is at risk of entering
reorganization or becoming insolvent, or that any Multiemployer Plan intends to
terminate or has been terminated under ss.4041A of ERISA.
24
ss. Regulations U and X.
The proceeds of the Loans shall be used (i) to refinance on the
Closing Date a portion of the Indebtedness of JBI, Inc. under the JBI Credit
Agreement and (ii) for working capital and general corporate purposes. The
Borrowers will obtain Letters of Credit solely for working capital and other
general corporate purposes. No portion of any Loan is to be used, and no portion
of any Letter of Credit is to be obtained, for the purpose of purchasing or
carrying any "margin security" or "margin stock" as such terms are used in
Regulations U and X of the Board of Governors of the Federal Reserve System, 12
C.F.R. Parts 221 and 224.
ss. Environmental Compliance.
Each Obligor has determined that (a) neither the Apparel Obligors
nor any operator of the Real Estate or any operations thereon, is in material
violation, or alleged material violation, of any Environmental Laws and (b) none
of the Real Estate owned by the Guarantor or any Subsidiary contains any
material amount of any Hazardous Substances.
ss. Fiscal Year.
The fiscal year of each of the Apparel Obligors ends on the Saturday
closest to January 31, of each calendar year.
ss. Loans as Senior Indebtedness.
All obligations and liabilities of the Apparel Obligors to the
Acceptance Bank, the Issuing Bank and/or the Lenders in respect of the principal
of and interest on the Loans and all Reimbursement Obligations under the Credit
Instruments will constitute "Senior Indebtedness", "Senior Debt" or "Superior
Indebtedness" under the terms of each of the documents or instrument evidencing,
or pursuant to which there is issued indebtedness which purports to be
Subordinated Debt.
ss. Other Representations.
Each of the representations and warranties made by each of the
Apparel Obligors or any other Person in any of the Loan Documents to which any
such Person is a party, was true and correct in all material respects when made
and continues to be true and correct in all material respects on the Closing
Date, except to the extent that any of such representations and warranties may
have been affected by the consummation of the transactions contemplated and
permitted or required by the Loan Documents.
ss. Solvency.
As of the Closing Date and after giving effect to the transactions
contemplated by the Loan Documents (including, without limitation, the
conversion into equity of all intercompany loans owing by any of the Borrowers
to any Subsidiary of the Guarantor (other than the Borrowers as of the Balance
Sheet Date)), (i) the property of each Obligor, at a fair valuation, will exceed
its debt; (ii) the capital of each Obligor will not be unreasonably small to
conduct its business; (iii) each Obligor will not have incurred debts, or have
intended to incur debts, beyond its ability to pay such debts as they mature;
and (iv) the present fair, saleable value of the assets of each Obligor will be
materially greater than the amount that will be required to pay its probable
liabilities (including debts) as they become absolute and
25
matured. For purposes of this ss.7.22, "debt" means any liability on a claim,
and "claim" means (i) the right to payment, whether or not such right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
undisputed, legal, equitable, secured or unsecured, or (ii) the right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, undisputed, secured or
unsecured.
ss. Bankers' Acceptances.
With respect to each draft accepted and discounted for a Borrower's
account by the Acceptance Bank, on behalf of the Lenders, that (i) each such
draft is an Eligible Draft; (ii) each such draft will grow out of one or more
transactions involving the importation or exportation of goods between two
countries or the domestic shipment of goods within the United States pursuant to
a contract in existence at the time of creation of such Bankers' Acceptance;
(iii) each such draft will finance a current shipment of goods; (iv) each such
draft of such Borrower as exporter/seller will have a tenor reasonably
commensurate with usual credit terms or six months, whichever is shorter; (v)
each such draft of such Borrower as importer/ purchaser will have a tenor
reasonably commensurate with the anticipated time of receipt of the goods plus
the anticipated time for preparing the goods for distribution into the channels
of trade or thirty (30) days, whichever is shorter; (vi) on the date of
acceptance of such draft, no other financing is or will be outstanding in
respect of such transaction during the period from the date of such draft until
the maturity thereof; (vii) all necessary licenses for the exportation,
importation and payment of the purchase price and related costs of shipment will
have been obtained; (viii) a description of goods being shipped, the actual or
anticipated date of shipment, value of the shipment and the addresses to which
and from which shipment will be made, has been furnished to the Acceptance Bank
for each such transaction; (ix) additional information about each such
transaction, including documents or copies of documents, will be furnished
promptly upon such Acceptance Bank's request and (x) on the date of acceptance
of such draft, such goods will be in the channels of trade and no other
financing will be existence for such transaction.
ss. Full Disclosure.
All information heretofore furnished by any Apparel Obligor to any
Lender or the Administrative Agent in connection with the Loan Documents was,
and all such information hereafter furnished by any Apparel Obligor to any
Lender or Administrative Agent will be, true and accurate in all material
respects or based on reasonable estimates on the date as of which such
information is stated or certified.
ss. AFFIRMATIVE COVENANTS OF THE APPAREL OBLIGORS.
Each Apparel Obligor covenants and agrees that, so long as any Loan,
Unpaid Reimbursement Obligation, Credit Instrument or Note is outstanding or any
Lender has any obligation to make any Loans or the Acceptance Bank or Issuing
Bank has any obligation to issue, extend or renew any Credit Instrument:
ss. Punctual Payment.
The Borrowers will duly and punctually pay or cause to be paid the
principal and interest on the Loans, all Reimbursement Obligations, the Letter
of Credit Fees, the facility fees, the Agents' fees and all other amounts
provided for in this Credit Agreement and the other Loan Documents to which any
26
Borrower or any of its Subsidiaries is a party, all in accordance with the terms
of this Credit Agreement and such other Loan Documents.
ss. Maintenance of Office.
Each Apparel Obligor will maintain its chief executive office at 000
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 or 00 Xxxxxxx Xxxxxx, Xxxx Xxxx,
Xxxxxxxxxxxxx 00000, or at such other place in the United States of America as
such Apparel Obligor shall designate upon written notice to the Administrative
Agent, where notices, presentations and demands to or upon such Apparel Obligor
in respect of the Loan Documents to which such Obligor is a party may be given
or made.
ss. Records and Accounts.
Each Apparel Obligor will (a) keep true and accurate records and
books of account in which full, true and correct entries will be made in
accordance with generally accepted accounting principles and (b) maintain
adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties,
contingencies, and other reserves.
ss. Financial Statements, Certificates and Information.
The Obligors will deliver to each of the Lenders:
as soon as practicable, but in any event not later than ninety
(90) days after the end of each fiscal year of the Obligors, the
consolidated and consolidating (in the case of the Guarantor and its
Subsidiaries) and the combined (in the case of the Borrowers and their
Subsidiaries) balance sheets as at the end of such year, and the
related consolidated and consolidating (in the case of the Guarantor
and its Subsidiaries) and combined (in the case of the Borrowers and
Subsidiaries) statements of income and statements of cash flow, for
such year, each setting forth in comparative form the figures for the
previous fiscal year and all such statements to be in reasonable
detail, prepared in accordance with generally accepted accounting
principles, and certified without qualification by KPMG Peat Marwick or
by other independent certified public accountants satisfactory to the
Administrative Agent, together with a written statement from such
accountants to the effect that they have read a copy of this Credit
Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event
of Default, or, if such accountants shall have obtained knowledge of
any then existing Default or Event of Default they shall disclose in
such statement any such Default or Event of Default; provided that such
accountants shall not be liable to the Lenders for failure to obtain
knowledge of any Default or Event of Default;
as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the first three fiscal
quarters of the Obligors, copies of the unaudited consolidated and
consolidating (in the case of the Guarantor and its Subsidiaries) and
combined (in the case of the Borrowers and their Subsidiaries) balance
sheets as at the end of such quarter, and the related consolidated and
combined statements of income and statements of cash flow for the
portion of Obligors' fiscal year then elapsed, all in reasonable detail
and prepared in accordance with generally accepted accounting
principles, together with a certification by the principal financial or
accounting officer of each Obligor that the information contained in
such financial statements
27
fairly presents the financial position of the Obligors and their
Subsidiaries on the date thereof (subject to year-end adjustments);
as soon as practicable, but in any event within forty-five
(45) days after the end of each month in each fiscal year of the
Obligors or in the case of the last month of each fiscal year, within
ninety (90) days, unaudited monthly consolidated (in the case of the
Guarantor and its Subsidiaries) and combined (in the case of the
Borrowers and their Subsidiaries) financial statements for such month
prepared in accordance with generally accepted accounting principles,
together with a certification by the principal financial or accounting
officer of each Obligor that the information contained in such
financial statements fairly presents the financial condition of the
Obligors and their Subsidiaries on the date thereof (subject to
year-end adjustments);
simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of each Obligor in
substantially the form of Exhibit B hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in ss.10 and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance
Sheet Date;
as soon as practicable and in any event no later than sixty
(60) days after the beginning of each fiscal year of the Obligors, a
quarterly consolidated and consolidating plan and financial forecast
for such fiscal year, including, without limitation, (i) forecasted
consolidated and consolidating balance sheets and forecasted
consolidated and consolidating statements of income and cash flows of
the Guarantor and its Subsidiaries for such fiscal year, and (ii) such
other projections as the Agents or any Lender may request;
upon the request of the Administrative Agent or any Lender,
copies of all compliance certificates and other reports and information
required to be delivered to the lenders under the Licensed Shoe Debt;
contemporaneously with the filing or mailing thereof,
copies of all material of a financial nature filed with the
Securities and Exchange Commission by the Guarantor or sent to the
stockholders of the Guarantor; and
from time to time such other financial data and information
(including accountants, management letters) as the Administrative Agent
or any Lender may reasonably request.
ss. Notices.
Defaults. The Apparel Obligors will promptly notify the Administrative
Agent and each of the Lenders in writing of the occurrence of any Default or
Event of Default. If any Person shall give any notice or take any other action
in respect of a claimed default (whether or not constituting an Event of
Default) under (i) this Credit Agreement or (ii) any other note, evidence of
indebtedness, indenture or other obligation to which or with respect to which
any Apparel Obligors is a party or obligor, whether as principal, guarantor,
surety or otherwise, the Obligors shall forthwith give written notice thereof to
the Administrative Agent and each of the Lenders, describing the notice or
action and the nature of the claimed default; provided, however, that no notice
shall be required to be given if the occurrence of the
28
default under any such note, evidence of indebtedness, indenture or other
obligation referred to in clause (ii) above would not result in an Event of
Default under ss.14.1(f) and would not have a material adverse effect on the
business and financial condition of Apparel Obligors.
Notice of Litigation and Judgments. The Apparel Obligors will give
notice to the Administrative Agent and each of the Lenders in writing within
twenty (20) days of becoming aware of any litigation or proceedings threatened
in writing or any pending litigation and proceedings affecting any of the
Apparel Obligors or to which any of such Persons is or becomes a party involving
an uninsured claim against such Apparel Obligors that could reasonably be
expected to have a materially adverse effect on any of such Persons and stating
the nature and status of such litigation or proceedings. The Apparel Obligors
shall give notice to the Administrative Agent and each of the Lenders, in
writing, in form and detail satisfactory to the Administrative Agent, within
twenty (20) days of any judgment not covered by insurance, final or otherwise,
against any of the Apparel Obligors in an amount in excess of $500,000.
ss. Corporate Existence; Maintenance of Properties.
The Apparel Obligors will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence,
and reasonably necessary to preserve their respective rights and franchises.
Each of the Apparel Obligors (a) will cause all of its properties used or useful
in the conduct of their respective businesses to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment,
(b) will use reasonable efforts, consistent with its strategic goals, to cause
to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times,
and (c) will continue to engage primarily in the businesses of the same general
type now conducted by them and in related businesses.
ss. Insurance.
The Apparel Obligors will maintain with financially sound and
reputable insurers insurance with respect to their respective properties and
businesses against such casualties and contingencies as shall be in accordance
with the general practices of businesses engaged in similar activities in
similar geographic areas and in amounts, containing such terms, in such forms
and for such periods as may be reasonable and prudent.
ss. Taxes.
Subject to provisions of the Tax Sharing Agreement, the Guarantor
will, and will cause each of its Subsidiaries to, duly pay and discharge, or
cause to be paid and discharged, before the same shall become overdue, all
taxes, assessments and other governmental charges imposed upon it and its real
properties, sales and activities, or any part thereof, or upon the income or
profits therefrom, as well as all claims for labor, materials, or supplies that
if unpaid might by law become a lien or charge upon any of its property;
provided that any such tax, assessment, charge, levy or claim need not be paid
if (a) the validity or amount thereof shall currently be contested in good faith
by appropriate proceedings and if the Guarantor or such Subsidiary shall have
set aside on its books adequate reserves with respect thereto or (b) to the
extent that the failure to do so could not be expected to result in a materially
adverse effect on the Guarantor's business or the business of any Borrower; and
provided further that the Guarantor and each of its Subsidiaries will pay all
such taxes, assessments, charges, levies or claims forthwith upon the
commencement of proceedings to foreclose any lien that may have attached as
security therefor.
29
ss. Inspection of Properties and Books, Etc.
General. Upon five (5) Business Days' prior notice, by the
Administrative Agent or any of the Lenders to the Apparel Obligors, the Lenders,
through the Administrative Agent or any of the Lenders' other designated
representatives, shall be permitted to visit and inspect any of the properties
of the Apparel Obligors, to examine the books of account of such Persons (and to
make copies thereof and extracts therefrom), and to discuss the affairs,
finances and accounts of such Persons with, and to be advised as to the same by,
its and their officers, all during normal business hours and at such reasonable
intervals as the Administrative Agent or any Lender may reasonably request;
provided, however, that in the event an Event of Default shall have occurred and
be continuing, no prior notice will be required for any such visit or
inspection.
Communications with Accountants. The Obligors authorize the Agents and,
if accompanied by the Agents, the Lenders to communicate directly with any
independent certified public accountants for the Guarantor or any of its
Subsidiaries and authorizes such accountants to disclose to the Administrative
Agent and the Lenders any and all financial statements and copies of any
management letter with respect to the business, financial condition and other
affairs of the Guarantor or any of its Subsidiaries. At the request of the
Administrative Agent, the Obligors shall cause to be delivered letters addressed
to such accountants instructing them to comply with the provisions of this
ss.8.9(b).
ss. Compliance with Laws, Contracts, Licenses, and Permits.
Each of the Apparel Obligors will (a) comply in all material
respects with the applicable laws and regulations wherever its business is
conducted, including all Environmental Laws, (b) comply with the provisions of
its charter documents and by-laws, (c) comply in all material respects with all
agreements and instruments by which it or any of its properties may be bound and
(d) comply in all material respects with all applicable decrees, orders, and
judgments, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a materially adverse effect on the
businesses of such Apparel Obligors. If any authorization, consent, approval,
permit or license from any officer, agency or instrumentality of any government
shall become necessary or required in order that any Apparel Obligor may fulfill
any of its obligations hereunder or any of the other Loan Documents to which
such Person is a party, such Apparel Obligor will immediately take or cause to
be taken all reasonable steps within the power of such Apparel Obligor to obtain
such authorization, consent, approval, permit or license and furnish the
Administrative Agent and the Lenders with evidence thereof. Without limiting the
foregoing, each of the Apparel Obligors will continuously hold all permits and
licenses required for the operation of its business, in all material respects,
including, without limitation all licenses, permits and other certificates
required by any Federal, state or local authority in connection with the
ownership and operation of its business.
ss. Employee Benefit Plans.
The Guarantor will, and will cause each of its Subsidiaries to, (i)
promptly upon filing the same with the Department of Labor or Internal Revenue
Service, furnish to the Administrative Agent, if requested by the Administrative
Agent, a copy of the most recent actuarial statement required to be submitted
under ss.103(d) of ERISA and Annual Report, Form 5500, with all required
attachments, in respect of each Guaranteed Pension Plan and (ii) promptly upon
receipt or dispatch, furnish to the Administrative Agent any notice, report or
demand sent or received in respect of a Guaranteed Pension
30
Plan under ss.ss.302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or
in respect of a Multiemployer Plan, under ss.ss.4041A, 4202, 4219, 4242, or 4245
of ERISA.
ss. Use of Proceeds.
Each Borrower will use the proceeds of the Loans solely (i) to
refinance on the Closing Date a portion of the Indebtedness of JBI, Inc. under
the JBI Credit Agreement and (ii) for working capital and general corporate
purposes. The Borrowers will obtain Letters of Credit solely for working capital
and general corporate purposes.
ss. Further Assurances.
The Apparel Obligors will cooperate with the Lenders and the
Administrative Agent and execute such further instruments and documents as the
Lenders or the Administrative Agent shall reasonably request to carry out to
their satisfaction the transactions contemplated by this Credit Agreement and
the other Loan Documents.
ss. Payment of Wages.
Each Borrower shall at all times comply, in all material respects,
with the requirements of the Fair Labor Standards Act, as amended, including,
without limitation, the provisions of such Act relating to the payment of
minimum and overtime wages as the same may become due from time to time.
ss. Maintenance of Corporate Separateness.
The Guarantor will, and will cause each of its Subsidiaries to,
satisfy customary corporate formalities, including the holding of regular board
of directors' and shareholders' meetings or action by directors or shareholders
without a meeting and the maintenance of corporate offices and records. None of
the Borrowers nor any of their respective Subsidiaries shall make any payment to
a creditor of any other Person in respect of any liability (other than those
liabilities set forth on Schedule 7.5) of any such other Person, and no bank
account of any Borrower or any of its Subsidiaries shall be commingled with any
bank account of any other Person that is not a Borrower. Any financial
statements distributed to any creditors of any Subsidiaries of the Guarantor
(other than the Borrowers and their Subsidiaries) shall clearly establish or
indicate the corporate separateness of such Subsidiary from the Borrowers and
their respective Subsidiaries. Finally, neither the Guarantor nor any of its
Subsidiaries shall take any action, or conduct its affairs in a manner, which is
likely to result in the corporate existence of the Guarantor or any of its
Subsidiaries being ignored, or in the assets and liabilities of the Borrowers or
any of their respective Subsidiaries being substantively consolidated with those
of any other Subsidiaries of the Guarantor in a bankruptcy, reorganization or
other insolvency proceeding.
ss. Cash Management System.
The Borrowers will, and will cause each of their Subsidiaries to,
utilize and maintain the Cash Management System for all deposits made by any of
them. The Cash Management System shall be operated solely for the business of
the Borrowers and their Subsidiaries.
31
ss. Corporate Overhead.
The Guarantor will cause each of the Borrowers to, maintain the
manner and allocation of such Person's corporate overhead and expense as between
such Persons and its Affiliates consistent with the past practices of the
Borrowers and are as set forth on Schedule 8.17 hereto.
ss. Lender Meeting.
The Obligors will, if requested by the Administrative Agent, (a)
participate in a meeting of the Lenders once during each fiscal year, as well as
such other times as may be reasonable during the occurrence or continuance of an
Event of Default, and (b) participate in all meetings of the Lenders necessary
(in the opinion of the Agents and the Arrangers) to syndicate successfully the
Total Commitment, each such meeting to be held at a location and a time selected
by the Agents and the Lenders in consultation with the Obligors.
ss. CERTAIN NEGATIVE COVENANTS OF THE APPAREL OBLIGORS.
Each Apparel Obligor covenants and agrees that, so long as any Loan,
Unpaid Reimbursement Obligation, Credit Instrument or Note is outstanding or any
Lender has any obligation to make any Loans or the Acceptance Bank or Issuing
Bank has any obligation to issue, extend or renew any Credit Instrument:
ss. Restrictions on Indebtedness.
The Apparel Obligors will not create, incur, assume, guarantee or be
or remain liable, contingently or otherwise, with respect to any Indebtedness
other than:
Indebtedness to the Lenders and the Administrative Agent
arising under any of the Loan Documents;
current liabilities of such Apparel Obligor incurred in the
ordinary course of business not incurred through (i) the borrowing of
money, or (ii) the obtaining of credit except for credit on an open
account basis customarily extended and in fact extended in connection
with normal purchases of goods and services;
Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be
made in accordance with the provisions of ss.8.8;
Indebtedness in respect of judgments or awards that have been
in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which such
Borrower or such Subsidiary shall at the time in good faith be
prosecuting an appeal or proceedings for review and in respect of which
a stay of execution shall have been obtained pending such appeal or
review;
endorsements for collection, deposit or negotiation and warranties
of products or services, in each case incurred in the ordinary course of
business;
32
obligations under Capitalized Leases not exceeding $2,500,000
in aggregate amount for all Apparel Obligors at any time outstanding;
Indebtedness incurred in connection with the acquisition after
the date hereof of any real or personal property by such Apparel
Obligor, provided that the aggregate principal amount of all such
Indebtedness of all Apparel Obligors shall not exceed the aggregate
amount of $1,000,000 at any one time; and further, provided that the
aggregate amount of indebtedness permitted under this clause (g) and
the immediately preceding clause (f) of this ss.9.1 shall not at any
time together exceed $2,500,000.
Indebtedness of the Guarantor under its License Shoe Guaranty;
Indebtedness existing on the date hereof and listed and
described on Schedule 9.1 hereto;
obligations of any Apparel Obligor under any lease treated as an
operating lease;
Indebtedness to any Lender under interest rate swap agreements
or similar interest rate protection agreements;
Indebtedness of the Guarantor under any guarantee of the
obligations of its Subsidiaries provided, that such obligations are
incurred in the ordinary course of business and not incurred (i)
through the borrowing of money, or (ii) through the obtaining of credit
(except for credit on an open account basis customarily extended and in
fact extended in connection with normal purchases of goods and
services) or (iii) under Capitalized Leases or under similar financing
arrangements; and
Indebtedness of any Apparel Obligor, existing as of
the Closing Date, in connection with the Subordinated Debt.
ss. Restrictions on Liens.
The Apparel Obligors will not (a) create or incur or suffer to be
created or incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (b) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (c) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (d) suffer to exist
for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; (e) sell, assign, pledge or otherwise
transfer any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; or (f) enter into or permit to exist any
arrangement or agreement which directly or indirectly prohibits any Apparel
Obligor from creating or incurring any lien, encumbrance, mortgage, pledge,
charge, restriction or other security interest of any kind, other than pursuant
to the Security Documents and Permitted Restrictions; provided that the Apparel
Obligors may create or incur or suffer to be created or incurred or to exist:
33
liens to secure taxes, assessments and other
government charges in respect of obligations not overdue or
being contested in good faith and with the Apparel Obligors
maintaining reserves required under generally accepted
accounting principles, or liens on properties other than Real
Estate to secure claims for labor, material or supplies in
respect of obligations not overdue;
deposits or pledges made in connection with, or to
secure payment of, workmen's compensation, unemployment
insurance, old age pensions or other social security
obligations;
liens on properties in respect of judgments or awards,
the Indebtedness with respect to which is permitted by
ss.9.1(d);
liens of carriers, warehousemen, mechanics and
materialmen, and other like liens on properties in existence
less than 120 days from the date of creation thereof in
respect of obligations not overdue;
encumbrances on Real Estate consisting of easements,
rights of way, zoning restrictions, restrictions on the use of
real property and defects and irregularities in the title
thereto, landlord's or lessor's liens under leases to which
such Apparel Obligor is a party, and other liens or
encumbrances none of which in the opinion of such Apparel
Obligor interferes materially with the use of the property
affected in the ordinary conduct of the business of such
Apparel Obligor, which defects do not individually or in the
aggregate have a materially adverse effect on the business of
such Apparel Obligor individually or of such Apparel Obligor
on a consolidated basis;
liens existing on the date hereof and listed on
Schedule 9.2 hereto;
purchase money security interests in or purchase
money mortgages on real or personal property acquired after
the date hereof to secure purchase money Indebtedness of the
type and amount permitted by ss.9.1(g), incurred in connection
with the acquisition of such property, which security
interests or mortgages cover only the real or personal
property so acquired;
encumbrances arising as a result of the operation of
Section 503(b) of the Bankruptcy Code; and
liens in favor of the Administrative Agent for the
benefit of the Lenders and the Administrative Agent under the
Loan Documents.
ss. Restrictions on Investments.
The Apparel Obligors will not make or permit to exist or to remain
outstanding any Investment except:
Investments in marketable direct or guaranteed obligations of
the United States of America that mature within one (1) year from the
date of purchase by such Apparel Obligor;
34
Investments in demand deposits, certificates of deposit,
bankers acceptances and time deposits of United States banks having
total assets in excess of $2,000,000,000;
Investments in securities commonly known as "commercial paper"
issued by a corporation organized and existing under the laws of the
United States of America or any state thereof that at the time of
purchase have been rated and the ratings for which are not less than "P
1" if rated by Xxxxx'x Investors Services, Inc., and not less than "A
1" if rated by Standard and Poor's;
Investments existing on the date hereof and listed on Schedule 9.3 hereto;
extensions of trade credit in the ordinary course of business; and
investments in: (i) bankers' acceptances having a maturity of
not more than one hundred and eighty (180) days and created by United
States commercial banks (having a combined capital surplus in of
$50,000,000); (ii) Eurodollar deposits; and (iii) common and preferred
stock traded on national securities exchanges so long as the aggregate,
at any one time invested under subclause (iii) of this clause (f) does
not exceed $50,000 in the aggregate;
(g) capital contributions which are permitted pursuant to ss.9.5.1(b);
(h) additional investments in the capital stock, or other beneficial
interests of, any other Apparel Obligor; and
(i) loans or advances made by any Borrower to any other Borrower;
(j) advances to employees of the Apparel Obligors for travel and other
business expenses to be incurred in the ordinary course of business;
(k) loans to employees of the Apparel Obligors of not more than $75,000
outstanding, in the aggregate, to any one employee or $500,000 outstanding, in
the aggregate, at any one time;
provided, however, that nothing in ss.ss.9.2, 9.3 and 9.5.2 shall
restrict or limit the rights of any Apparel Obligor to sublet any store or
facility.
ss. Distributions.
The Borrowers will not make any Distributions; provided, however,
that (a) the Borrowers may, from time to time, make a Permitted Distribution so
long as (i) no Default or Event of Default shall have occurred and be continuing
on the date of the payment of any Permitted Stock Dividend under the Loan
Documents (or would result therefrom); (ii) the Guarantor receives a
simultaneous Distribution from its Subsidiaries (other than the Borrowers or any
Subsidiary of the Borrowers) in an equivalent amount as such Permitted
Distribution, and (iii) the ability of any Subsidiary of the Guarantor (other
than the Borrowers and the Borrowers' Subsidiaries) to make Distributions to the
Guarantor under any other agreement is not restricted in any manner, and (b) the
Borrowers and its Subsidiaries may make payments to the Guarantor to the extent
necessary to permit the Guarantor to discharge that portion of the consolidated
tax liabilities of the Guarantor and its Subsidiaries which are attributable
solely to the income
35
and operations of the Borrowers and the Borrowers' Subsidiaries and consistent
with the terms of the Tax Sharing Agreement.
ss. Merger, Consolidation and Disposition of Assets.
Mergers and Acquisitions.
(a) The Guarantor will not, and will not permit any of its
Subsidiaries to, become a party to any merger or consolidation, or
agree to or effect any asset acquisition or equity acquisition (other
than the acquisition of assets in the ordinary course of business
consistent with past practices) except that, so long as no Default or
Event of Default has occurred or is continuing, or would exist after
giving effect thereto:
(i) any Borrower may merge into a Borrower,
(ii) any Subsidiary which is not a Borrower (or a Subsidiary of a Borrower)
may merge into another Subsidiary which is not a Borrower (or a Subsidiary of a
Borrower),
(iii) the Guarantor or any Subsidiary which is not a
Borrower (or a Subsidiary of a Borrower) may enter into asset
or stock acquisitions of Persons in the same or a similar line
of business or distribution channels as the Guarantor and its
Subsidiaries (a "Permitted Acquisition") where (A) the
Guarantor has provided the Administrative Agent with ten (10)
Business Days prior written notice of such Permitted
Acquisition, which notice shall include a reasonably detailed
description of such Permitted Acquisition; (B) the business to
be acquired would not subject the Agents, the Acceptance Bank,
the Issuing Bank or the Lenders to regulatory or third party
approvals in connection with the exercise of its rights and
remedies under this Credit Agreement or any other Loan
Document; (C) no contingent obligations or liabilities will be
incurred or assumed in connection with such Permitted
Acquisition which could be expected to have a material adverse
effect on the business, assets or financial condition of any
of the Apparel Obligors; (D) the Guarantor shall have provided
the Administrative Agent with such other information as was
reasonably requested by the Agents; and (E) the Obligors have
demonstrated to the reasonable satisfaction of the Agents,
based on a pro forma Compliance Certificate, compliance with
ss.10 on a pro forma basis immediately prior to and after
giving effect to such Permitted Acquisition.
(b) The Borrowers will not, and will not permit any of their
Subsidiaries to, create or acquire any Subsidiaries except, so long as
no Default or Event of Default has occurred or is continuing, or would
exist after giving effect thereto, any Borrower may create or acquire a
Subsidiary so long as:
the issued and outstanding capital stock or other equity interests of all
classes of such Subsidiary is one hundred percent (100%) owned by such Borrower;
36
(ii) the aggregate of all capital contributions by
the Guarantor or the Borrower, or any combination thereof, to
all Subsidiaries of the Borrowers created after the Closing
Date, does not exceed $1,000,000;
(iii) such Subsidiary shall, at the election of the
Majority Lenders, become either a guarantor of the Obligations
or a Borrower hereunder and, contemporaneously therewith,
shall execute such documents in connection therewith as the
Agents may require;
(iv) all issued and outstanding capital stock or
other equity interests of all classes of such Subsidiary are,
contemporaneously therewith, pledged to the Administrative
Agent for the benefit of the Lenders as security for the
payment and performance of the Obligations, pursuant to
documentation satisfactory to the Agents; and
(v) in connection with the foregoing subclauses (iii)
and (iv), and contemporaneously therewith, the Borrowers shall
deliver or cause to be delivered to the Agents and the Lenders
all such instruments and documents (including legal opinions)
as the Agents shall reasonably request to evidence compliance
with this ss.9.5.1(b) and the other terms hereof.
Disposition of Assets.
The Guarantor will not, and will not permit any of its
Subsidiaries to, become a party to or agree to or effect any Asset Sale
without the prior written consent of the Majority Lenders except that,
so long as no Default or Event of Default has occurred or is
continuing, or would exist after giving effect thereto (i) the
Guarantor may sell any Subsidiary which is not a Borrower or a
Subsidiary of a Borrower and (ii) the Guarantor and any Subsidiary
which is not a Borrower or a Subsidiary of a Borrower may consummate
any Asset Sale (each, a "Permitted Disposition"); provided, that (a)
the Guarantor has provided the Administrative Agent with ten (10)
Business Days prior written notice of any such Permitted Disposition,
which notice shall include a reasonably detailed description of such
Permitted Disposition; and (b) the Obligors have demonstrated to the
reasonable satisfaction of the Agents, based on a pro forma Compliance
Certificate, compliance with ss.10 on a pro forma basis immediately
prior to and after giving effect to such Permitted Disposition.
ss. Sale and Leaseback.
The Apparel Obligors will not enter into any arrangement, directly
or indirectly, whereby any Apparel Obligors shall sell or transfer any property
owned by it for more than ninety (90) days in order then or thereafter to lease
such property or lease other property that such Apparel Obligor intends to use
for substantially the same purpose as the property being sold or transferred.
ss. Employee Benefit Plans.
No Obligor or any ERISA Affiliate will:
37
engage in any "prohibited transaction" within the meaning of
ss.406 of ERISA or ss.4975 of the Code which could result in a material
liability for such Obligor or any of its Subsidiaries; or
permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in ss.302 of ERISA,
whether or not such deficiency is or may be waived; or
fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which,
could result in the imposition of a lien or encumbrance on the assets
of such Borrower or any of its Subsidiaries pursuant to ss.302(f) or
ss.4068 of ERISA; or
any Guaranteed Pension Plan in circumstances requiring the posting of security
pursuant to ss.307 of ERISA or ss.401(a)(29) of the Code; or
permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of ss.4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities.
Additional Shares.
No Borrower will at any time, nor will any Borrower cause or permit
any of its Subsidiaries at any time, to sell or offer to sell any shares of any
class of capital stock, or any other securities, of such Borrower or any
Subsidiary.
ss. Changes in Terms of Subordinated Debt.
No Obligor will, and none will permit any of its Subsidiaries to,
make any changes relating to the interest rate, maturity, scheduled
amortization, notice to the Lenders and the Administrative Agent of defaults,
events of default or intended accelerations, subordination or any other
provision of any promissory note, indenture, agreement or other instrument
evidencing or governing any Subordinated Debt.
ss. Change of Fiscal Year.
None of the Apparel Obligors shall change its fiscal year.
ss. Total Commitment Amount.
The Borrowers shall not cause or permit the sum of the outstanding
amount of all Loans, the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations to exceed the Total Commitment.
ss. Amendments or Waivers of Certain Documents.
After the Closing Date, (a) none of the Apparel Obligors, without
the prior written consent of the Majority Lenders, which consent shall not be
unreasonably withheld (but which may be withheld if the effect of any amendment,
supplement, change or waiver would be adverse to the Lenders or the
38
Apparel Obligors), amend, supplement, change or waive compliance with or consent
to departures from the terms of its certificate of incorporation or bylaws or
any agreement entered into by any such Person with respect to its equity
interests which change, amendment, supplement or waiver would have a material
adverse effect on the financial condition, assets or business of any Apparel
Obligor or adversely affect the rights, remedies or benefits available to the
Agents, the Issuing Bank, the Acceptance Bank or any Lender under any Loan
Document, (b) the Apparel Obligors shall not amend, supplement, change or waive
compliance with or consent to a departure from, or consent to any action or
failure to act under, any of the terms or provisions of any Subordinated Debt or
the Licensed Shoe Guaranty, or any other material contract, lease, license or
agreement of such Person and (c) the Apparel Obligors shall not amend,
supplement, change or waive compliance with or consent to a departure from, or
consent to any action or failure to act under, the Tax Sharing Agreement.
ss. Limitation on Other Restrictions on Amendment of Loan Documents.
The Apparel Obligors will not enter into, suffer to exist or become
or remain subject to any agreement or instrument to which such Person is a party
or by which such Person or any property of such Person (now owned or hereafter
acquired) may be subject or bound, except for the Loan Documents, that would
prohibit or restrict in any manner (directly or indirectly and including by way
of covenant representation or warranty or event of default), or require the
consent of any Person to, any amendment to, or waiver or consent to departure
from the terms of, any of the Loan Documents.
ss. Purchase of Ineligible Securities.
The Obligors will not, and will not permit any of their Subsidiaries to,
directly or indirectly, use any portion of the Loans or Letter of Credit
proceeds (a) knowingly to purchase Ineligible Securities from a Section 20
Subsidiary during any period in which such Section 20 Subsidiary makes a market
in such Ineligible Securities, (b) knowingly to purchase during the underwriting
or placement period Ineligible Securities being underwritten or privately placed
by a Section 20 Subsidiary, or (c) to make payments of principal or interest on
Ineligible Securities underwritten or privately placed by a Section 20
Subsidiary and issued by or for the benefit of the Borrowers, any other
Subsidiary or any Affiliates.
ss. FINANCIAL COVENANTS OF THE APPAREL OBLIGORS.
Each Apparel Obligor covenants and agrees that, so long as any Loan,
Unpaid Reimbursement Obligation or Note is outstanding or any Lender has any
obligation to make any combined Loans or the Administrative Agent or Issuing
Bank has any obligation to issue, extend or renew any Credit Instruments:
39
ss. Fixed Charge Coverage Ratio.
The Borrowers will not permit the Fixed Charge Coverage Ratio at the
end of any fiscal quarter ending during any period described below to be less
than the ratio set forth opposite such period below:
=========================================================================
Period Ratio
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Fiscal quarter ending May 3, 1997 1.00 to 1
----------------------------------------------------------------------------
Two consecutive fiscal quarters ending August 2, 1997 1.00 to 1
---------------------------------------------------------------------------
Three consecutive fiscal quarters ending November 1, 1997 1.00 to 1
----------------------------------------------------------------------------
Each period of four consecutive fiscal
quarters ending February 1, 1998
through October 31, 1998 1.25 to 1
----------------------------------------------------------------------------
Each period of four consecutive fiscal quarters ending 1.35 to 1
January 31, 1999 through October 30, 1999
----------------------------------------------------------------------------
Each period of four consecutive fiscal
quarters ending thereafter 1.45 to 1
----------------------------------------------------------------------------
ss. Leverage Ratio.
The Borrowers will not
permit the Leverage Ratio as at the end of any fiscal quarter ending during any
period described below to be greater than the ratio set forth opposite such
period below:
=============================================================================
Period Ratio
----------------------------------------------------------------------------
Fiscal quarter ended February 1, 1998 2.00 to 1
----------------------------------------------------------------------------
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February 2, 1998 through October 31, 1998 3.00 to 1
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November 1, 1998 through January 31, 1999 1.75 to 1
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February 1, 1999 through October 30, 1999 2.75 to 1
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October 31, 1999 and thereafter 1.50 to 1
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ss. Consolidated Tangible Net Worth.
The Obligors will not permit the Consolidated Tangible Net Worth of
the Guarantor and its Subsidiaries at any time to be less than the sum of (a)
$65,713,184, plus (b) on a cumulative basis, 75% of positive Consolidated Net
Income of the Guarantor and its Subsidiaries for each fiscal quarter beginning
with the fiscal quarter ended May 2, 1997, plus (c) 100% of the proceeds of
any sale by the
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Guarantor of equity securities issued by the Guarantor from and after February
2, 1997, less (d) the Permitted Stock Dividends made from and after February
2, 1997, plus (e) any increase in the Guarantor's net worth resulting from a
conversion of any "convertible" debt securities issued by the Guarantor.
ss. Combined Tangible Net Worth.
The Borrowers will not permit the Combined Tangible Net Worth of
the Borrowers and their Subsidiaries at any time to be less than the sum of
(a) $23,600,144, plus (b) on a cumulative basis, 75% of positive Combined Net
Income of the Borrowers and their Subsidiaries for each fiscal quarter
beginning with the fiscal quarter ended May 2, 1997, plus (c) 100% of the
proceeds of any sale by any Borrower of equity securities issued by Borrowers
from and after February 2, 1997, less (d) the Permitted Distributions made
from and after February 2, 1997, plus (e) any amortization of the contra
account of the Borrowers, described on their combined balance sheet as the
"intercompany account" which results in an increase to shareholder's equity.
ss. Capital Expenditures; Capitalized Leases.
None of the Apparel Obligors will make Capital Expenditures plus
Capitalized Lease expenditures (including the "face amount" of Capitalized
Leases) that exceed, in the aggregate for all Apparel Obligors (a) $9,000,000
in the aggregate during the fiscal year of the Borrowers ending January 31,
1998 and (b) $10,000,000 in the aggregate during each fiscal year of the
Borrowers ending after February 1, 1998.
ss. INITIAL CLOSING CONDITIONS.
The obligations of the Lenders to make the initial Loans and of the
Acceptance Bank or Issuing Bank to issue any initial Credit Instruments, shall
be subject to the satisfaction of the following conditions precedent on or
prior to the Closing Date:
ss. Loan Documents.
Each of the Loan Documents shall have been duly executed and
delivered by the respective parties thereto, shall be in full force and effect
and shall be in form and substance satisfactory to each of the Lenders. Each
Lender shall have received a fully executed copy of each such document,
certified as true and correct by the Obligors.
ss. Certified Copies of Charter Documents.
The Administrative Agent shall have received from each of the
Apparel Obligors a copy, certified by a duly authorized officer of such Person
to be true and complete on the Closing Date, of each of (a) its charter or
other incorporation documents as in effect on such date of certification, and
(b) its by-laws as in effect on such date.
ss. Corporate, Action.
All corporate action necessary for the valid execution, delivery
and performance by each Apparel Obligor of this Credit Agreement and the other
Loan Documents to which it is or is to become
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a party shall have been duly and effectively taken, and evidence thereof
satisfactory to the Agents shall have been provided to the Administrative
Agent.
ss. Incumbency Certificates.
The Administrative Agent shall have received from each of the
Apparel Obligors an incumbency certificate, dated as of the Closing Date,
signed by a duly authorized officer of such Person, and giving the name and
bearing a specimen signature of each individual who shall be authorized: (a)
to sign, in the name and on behalf of Person, each of the Loan Documents to
which such Person is or is to become a party; (b) in the case of such
Borrower, to make Loan Requests and apply for Credit Instruments; and (c) to
give notices and to take other action on such Persons' behalf under the Loan
Documents.
ss. Legality of Transactions.
No change in applicable law shall have occurred as a consequence of
which it shall have become and continue to be unlawful (a) for any Lender or
the Administrative Agent to perform any of its agreements or obligations under
any of the Loan Documents to which any such Person is a party on the Closing
Date or (b) for any Obligor or any of its Subsidiaries to perform any of its
agreements or obligations under any of the Loan Documents to which it is a
party on the Closing Date.
ss. Validity of Liens.
The Security Documents shall be effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable first security interest in and lien upon the Collateral. All
deliveries of (a) certificates representing all of the outstanding capital
stock of the Borrowers and (b) duly executed stock powers relating to such
capital stock to the Administrative Agent to perfect such security interests
shall have been duly effected.
ss. UCC Search Results.
The Administrative Agent shall have received UCC searches with
respect to the Obligors, indicating no liens other than Permitted Liens and
otherwise in form and substance satisfactory to the Administrative Agent.
ss. Proceedings and Documents.
All corporate, partnership, governmental and other proceedings in
connection with the transactions contemplated by the Loan Documents and all
instruments and documents incidental thereto, shall be in form and substance
reasonably satisfactory to the Lenders and the Lenders shall have received all
such counterpart originals or certified or other copies of all such
instruments and documents as the Lenders shall have reasonably requested.
ss. Financial Condition.
The Lenders shall be satisfied that the financial statements
referred to in ss.7.5 fairly present the business and financial condition of
the Obligors, as at and for the periods ending on the respective dates
thereof, and that, except for changes described in writing to the Lenders and
acceptable to them,
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there has been no material adverse change in the assets, business or financial
condition of any Obligor since the applicable dates set forth in ss.7.5
hereof.
ss. Opinion of Counsel.
Each of the Lenders and the Agents shall have received a favorable
legal opinion addressed to the Lenders and the Agents, dated as of the Closing
Date, in form and substance satisfactory to the Lenders and the Agents, from
Xxxxxxx, Procter & Xxxx LLP, counsel to the Obligors.
ss. Payment of Agents' Fees.
The Borrowers shall have paid the fees to the Agents pursuant to ss.5.1.
ss. Payoff Letter.
The Administrative Agent shall have received a payoff letter from
Fleet, as agent to the Banks named therein, indicating the amount of the loan
obligations of the Borrowers to Fleet, as agent to the Banks named therein, to
be discharged on the Closing Date and an acknowledgment by Fleet, as agent to
the Banks named therein, that upon receipt of such funds the JBI Credit
Agreement, and all Obligations thereunder (as defined therein) will have
terminated, and it will forthwith execute and deliver to the Administrative
Agent for filing all termination statements and take such other actions as may
be necessary to discharge all mortgages, deeds of trust and security interests
granted by the Borrowers or any of their Subsidiaries in favor of Fleet, as
agent to the Banks named therein.
ss. Disbursement Instructions.
The Administrative Agent shall have received disbursement
instructions from the Borrowers regarding use of proceeds of the initial
Loans.
ss. Senior Indebtedness.
The Administrative Agent shall have received evidence satisfactory
to it that all of the Obligations constitute "Senior Indebtedness," "Senior
Debt," or "Superior Indebtedness" under the Subordinated Debt.
ss. Certified Copies of Subordinated Debt Documents.
The Administrative Agent shall have received from the Apparel
Obligors a copy, certified by a duly authorized officer to be true and
complete on the Closing Date, of all documents evidencing or otherwise related
to Subordinated Debt.
ss. Licensed Shoe Debt.
The Administrative Agent shall have received evidence satisfactory
to it that the Licensed Shoe division of the Guarantor shall have consummated
its financing arrangements with respect to the Licensed Shoe Debt, the
documentation evidencing the Licensed Shoe Debt to be in form and substance
satisfactory to the Administrative Agent.
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ss. Cash Management System.
The Borrowers and their Subsidiaries shall have created a cash
management system (the "Cash Management System") satisfactory to the Agents,
and all agreements related thereto shall have been delivered to the Agents and
shall be satisfactory to the Agents.
ss. Tax Sharing Agreement.
The Administrative Agent shall have received a fully executed copy
of the Tax Sharing Agreement, in form and substance satisfactory to the Agents
in all respects.
ss. CONDITIONS TO ALL BORROWINGS.
The obligations of the Lenders to make any Loan, and the Acceptance
Bank or Issuing Bank to issue, extend or renew any Credit Instruments in each
case whether on or after the Closing Date, shall also be subject to the
satisfaction of the following conditions precedent:
ss. Representations True; No Event of Default.
Each of the representations and warranties of the Apparel Obligors
contained in this Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with this Credit Agreement
shall be true as of the date as of which they were made and shall also be true
at and as of the time of the making of such Loan or the issuance, extension or
renewal of such Credit Instrument, with the same effect as if made at and as of
that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.
ss. No Legal Impediment.
No change shall have occurred in any law or regulations thereunder
or interpretations thereof that in the reasonable opinion of any Lender would
make it illegal for such Lender to make such Loan or participate in the
issuance, extension or renewal of such Credit Instrument, or in the opinion of
the Acceptance Bank or the Issuing Bank would make it illegal for the Acceptance
Bank or the Issuing Bank to issue, extend or renew such Credit Instruments.
ss. Governmental Regulation.
Each Lender shall have received such statements in substance and
form reasonably satisfactory to such Lender as such Lender shall require for the
purpose of compliance with any applicable regulations of the Comptroller of the
Currency or the Board of Governors of the Federal Reserve System.
ss. Proceedings and Documents.
All proceedings in connection with the transactions contemplated by
this Credit Agreement, the other Loan Documents and all other documents incident
thereto shall be reasonably satisfactory in substance and in form to the Lenders
and to the Administrative Agent and the Administrative Agent's
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Special Counsel, and the Lenders, the Administrative Agent and such counsel
shall have received all information and such counterpart originals or certified
or other copies of such documents as the Administrative Agent may reasonably
request.
ss. GUARANTY.
ss. Guaranty Of Payment And Performance.
For value received and hereby acknowledged and as an inducement to
the Lenders to make the Loans to the Borrowers, the Guarantor hereby
unconditionally guarantees to the Administrative Agent and the Lenders the full
and punctual payment in cash when due (whether at maturity, by acceleration or
otherwise), and the performance, of all of the Obligations, whether direct or
indirect, absolute or contingent, due or to become due, secured or unsecured,
now existing or hereafter arising or acquired. The guaranty contained herein is
an absolute, unconditional and continuing guaranty of the full and punctual
payment in cash and performance of the Obligations and not of their
collectability only and is in no way conditioned upon any requirement that the
Administrative Agent and/or the Lenders first attempt to collect any of the
Obligations from any of the Borrowers or resort to any security or other means
of obtaining their payment. Should any of the Borrowers default in the payment
or performance of any of the Obligations, the obligations of the Guarantor
hereunder shall become immediately due and payable to the Administrative Agent
and the Lenders, without demand or notice of any nature, all of which are
expressly waived by the Guarantor. Payments by the Guarantor hereunder may be
required by the Administrative Agent and the Lenders on any number of occasions.
ss. Guarantor's Agreement To Pay.
The Guarantor further agrees, as a principal obligor and not as a
guarantor only, to pay to the Administrative Agent, on behalf of the Lenders, on
demand, all costs and expenses (including court costs and reasonable legal
expenses) incurred or expended by the Administrative Agent, the Acceptance Bank,
the Issuing Bank and/or the Lenders, on behalf of the Lenders in connection with
the enforcement or collection of the Obligations and the guaranty contained
herein, together with interest on amounts recoverable under the Guaranty
contained herein from the time such amounts become due until payment, at the
rate per annum equal to three percent (3%) above the Base Rate from time to time
in effect plus the Applicable Margin; provided that if such interest exceeds the
maximum amount permitted to be paid under applicable law, then such interest
shall be reduced to such maximum permitted amount.
ss. Unlimited Guaranty.
The liability of the Guarantor hereunder shall be unlimited.
ss. Waivers By the Guarantor; Administrative Agent's and Lenders' Freedom To Act
The Guarantor agrees that the Obligations will be paid and performed
strictly in accordance with their respective terms regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of the Administrative Agent and Lenders with respect
thereto. The Guarantor waives presentment, demand, protest, notice of
acceptance, notice of Obligations incurred and all other notices of any kind,
all defenses which may be available by virtue of any valuation, stay, moratorium
law or other similar law now or hereafter in effect, any right to require the
marshalling of assets of any of the Borrowers, and all suretyship defenses
generally. Without limiting the generality
45
of the foregoing, the Guarantor agrees to the provisions of any instrument
evidencing, securing or otherwise executed in connection with any Obligation and
agrees that the obligations of the Guarantor hereunder shall not be released or
discharged, in whole or in part, or otherwise affected by (i) the failure of the
Agents, the Acceptance Bank, the Issuing Bank and/or the Lenders to assert any
claim or demand or to enforce any right or remedy against any of the Borrowers;
(ii) any extensions or renewals of any Obligation; (iii) any rescissions,
waivers, amendments or modifications of any of the terms or provisions of any
agreement evidencing, securing or otherwise executed in connection with any
Obligation; (iv) the substitution or release of any entity primarily or
secondarily liable for any Obligation; (v) the adequacy of any rights the
Administrative Agent, the Acceptance Bank, the Issuing Bank or the Lenders may
have against any collateral or other means of obtaining repayment of the
Obligations; (vi) the impairment of any collateral securing the Obligations,
including without limitation the failure to perfect or preserve any rights the
Administrative Agent, the Acceptance Bank, the Issuing Bank or the Lenders might
have in such collateral or the substitution, exchange, surrender, release, loss
or destruction of any such collateral; or (vii) any other act or omission which
might in any manner or to any extent vary the risk of the Guarantor or otherwise
operate as a release or discharge of the Guarantor, all of which may be done
without notice to the Guarantor.
ss. Unenforceability Of Obligations Against Borrowers.
If for any reason any of the Borrowers has no legal existence or is
under no legal obligation to discharge any of the Obligations, or if any of the
Obligations have become irrecoverable from the Borrowers by operation of law or
for any other reason, the guaranty contained herein shall nevertheless be
binding on the Guarantor to the same extent as if the Guarantor at all times had
been the principal obligor on all such Obligations. In the event that
acceleration of the time for payment of the Obligations is stayed upon the
insolvency, bankruptcy or reorganization of any of the Obligors, or for any
other reason, all such amounts otherwise subject to acceleration under the terms
of any agreement evidencing, securing or otherwise executed in connection with
any Obligation shall be immediately due and payable by the Guarantor.
ss. Subrogation; Subordination.
Until the payment and performance in full in cash of all
Obligations, the Guarantor shall not exercise any rights against any Borrower
arising as a result of payment by the Guarantor hereunder, by way of subrogation
or otherwise, and will not prove any claim in competition with the
Administrative Agent and/or the Lenders or any of their affiliates in respect of
any payment hereunder in bankruptcy or insolvency proceedings of any nature; the
Guarantor will not claim any set-off or counterclaim against any Borrower in
respect of any liability of the Guarantor to any Guarantor; and the Guarantor
waives any benefit of and any right to participate in any collateral which may
be held by the Administrative Agent, any Lender or any such affiliate. The
payment of any amounts due with respect to any indebtedness of the Borrowers now
or hereafter held by the Guarantors is hereby subordinated to the prior payment
in full in cash of the Obligations. The Guarantor agrees that it will not
demand, xxx for or otherwise attempt to collect any such indebtedness of the
Borrowers to the Guarantor until the Obligations shall have been paid in full in
cash. If, notwithstanding the foregoing sentence, the Guarantor shall collect,
enforce or receive any amounts in respect of such indebtedness, such amounts
shall be collected, enforced and received by the Guarantor as trustee for the
Administrative Agent and the Lenders and be paid over to the Administrative
Agent on account of the Obligations without affecting in any manner the
liability of the Guarantor under the other provisions of the guaranty contained
herein.
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ss. Termination; Reinstatement.
The guaranty contained herein shall remain in full force and effect
until the Obligations have been indefeasibly paid in full in cash. The guaranty
contained herein shall continue to be effective or be reinstated, if at any time
any payment made or value received with respect to an Obligation is rescinded or
must otherwise be returned by the Administrative Agent, the Acceptance Bank, the
Issuing Bank or any Lender upon the insolvency, bankruptcy or reorganization of
any of the Borrowers, or otherwise, all as though such payment had not been made
or value received.
ss. Miscellaneous.
The rights and remedies herein provided are cumulative and not
exclusive of any remedies provided by law or any other agreement, and the
guaranty contained herein shall be in addition to any other guaranty of the
Obligations.
ss. EVENTS OF DEFAULT; ACCELERATION; ETC.
ss. Events of Default and Acceleration.
If any of the following events ("Events of Default" or, if the
giving of notice or the lapse of time or both is required, then, prior to such
notice or lapse of time, "Defaults") shall occur:
any
Borrower shall fail to pay any principal of the Loans or any
Reimbursement Obligation when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
any Borrower or any of its Subsidiaries shall fail to pay any
interest on the Loans, the facility fee, the Bankers' Acceptance Fees,
any Letter of Credit Fee, the Agents' fees, or other sums due hereunder
or under any of the other Loan Documents, after the same shall become
due and payable, whether at the stated date of maturity or any
accelerated date of maturity or at any other date fixed for payment,
and such failure shall continue unremedied for a period of five (5)
days;
any Obligor shall fail to comply with any of its covenants
contained in (i) ss.10, or (ii) ss.9 and such default shall continue
unremedied for a period of ten (10) days after notice of such default
is given to the Borrowers by the Administrative Agent or any Lender;
any Apparel Obligor shall fail to perform any term, covenant
or agreement contained herein or in any of the other Loan Documents
(other than those specified elsewhere in this ss.14.1) for thirty (30)
days after written notice of such failure has been given to such
Obligor by the Administrative Agent;
any representation or warranty of any Obligor in this Credit
Agreement or any of the other Loan Documents or in any other document
or instrument delivered pursuant to or in connection with this Credit
Agreement shall prove to have been false in any material respect upon
the date when made or deemed to have been made or repeated;
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The Guarantor or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace (not to exceed
thirty (30) days), (i) any Indebtedness with an outstanding principal
amount in excess of $1,000,000, (ii) any Indebtedness under the
Licensed Shoe Debt, or (iii) any obligations in respect of any
operating leases where the remaining lease payments (under one or more
operating leases) would, in the aggregate, be in excess of $1,000,000,
or fail to observe or perform any term, covenant or agreement contained
in any agreement by which it is bound, evidencing or securing any such
Indebtedness described in subclauses (i) or (ii) of this clause (f), or
any such operating lease described in subclause (iii) of this clause
(f) for such period of time as would permit (assuming the giving of
appropriate notice if required) the holder or holders thereof or of any
obligations issued thereunder to accelerate the maturity thereof or
otherwise act to enforce any rights and remedies thereunder, unless,
prior to termination of the Commitments and/or acceleration pursuant to
this ss.14.1, the holder or holders of such obligations shall have, in
writing, waived such default and a copy of such waiver of default shall
have been furnished to the Administrative Agent;
the Guarantor or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of any such Person or of any
substantial part of the assets of such Person or shall commence any
case or other proceeding relating to the Guarantor or any of its
Subsidiaries under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation or similar
law of any jurisdiction, now or hereafter in effect, or shall take any
action to authorize or in furtherance of any of the foregoing, or if
any such petition or application shall be filed or any such case or
other proceeding shall be commenced against the Guarantor or any of its
Subsidiaries and the Guarantor or any of its Subsidiaries shall
indicate its approval thereof, consent thereto, acquiescence therein or
otherwise remain undismissed for a period of sixty (60) days;
a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Guarantor or any
of its Subsidiaries bankrupt or insolvent, or approving a petition in
any such case or other proceeding, or a decree or order for relief is
entered in respect of the Guarantor or any of its Subsidiaries in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted (which order is not dismissed within sixty (60) days after
the entry thereof);
there shall remain in force, undischarged, unsatisfied,
unstayed for more than sixty (60) days, whether or not consecutive, any
final judgment (unless bonded pending appeal) against the Apparel
Obligors that, with other outstanding final judgments, undischarged,
against the Borrower or any of its Subsidiaries exceeds in $500,000 the
aggregate;
the holders of all or any part of Subordinated Debt shall
accelerate the maturity of all or any part of the Subordinated Debt or
the Subordinated Debt shall be prepaid, redeemed or repurchased in
whole or in part; provided, however, that a conversion of the
Subordinated Notes into equity interests in the Guarantor (pursuant to
the terms of the indenture under which the Subordinated Notes were
issued) shall not constitute a prepayment, redemption or repurchase of
such Subordinated Notes;
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if any of the Loan Documents, including without limitation,
the guaranty provisions contained within the Credit Agreement, shall be
canceled, terminated, revoked or rescinded otherwise than in accordance
with the terms thereof or with the express prior written agreement,
consent or approval of the Lenders, or any action at law, suit or in
equity or other legal proceeding to cancel, revoke or rescind any of
the Loan Documents shall be commenced by or on behalf of the Guarantor
or any of its Subsidiaries party thereto or any of their respective
stockholders, or any court or any other governmental or regulatory
authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid
or unenforceable in accordance with the terms thereof;
with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Majority Lenders shall
have determined in their reasonable discretion that such event
reasonably could be expected to result in liability of the Obligors or
any of their Subsidiaries to the PBGC or such Guaranteed Pension Plan
in an aggregate amount exceeding $1,000,000 and such event in the
circumstances occurring reasonably could constitute grounds for the
termination of such Guaranteed Pension Plan by the PBGC or for the
appointment by the appropriate United States District Court of a
trustee to administer such Guaranteed Pension Plan; or a trustee shall
have been appointed by the United States District Court to administer
such Plan; or the PBGC shall have instituted proceedings to terminate
such Guaranteed Pension Plan;
the Borrowers shall be enjoined, restrained or in any way
prevented by the order of any court or any administrative or regulatory
agency from conducting any material part of its business and such order
shall continue in effect for more than thirty (30) days;
there shall occur any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty, which in
any such case causes, for more than sixty (60) consecutive days, the
complete cessation of revenue producing activities at a material number
of facilities of the Guarantor or any of its Subsidiaries if such event
or circumstance is not covered by business interruption insurance and
has a material adverse effect on the business or financial condition of
the Borrowers taken as a whole;
except as permitted under ss.9.5,
the Guarantor shall, at any time, legally or beneficially own
directly or indirectly, less than one hundred percent of the issued and
outstanding capital stock of any Borrower, on a fully diluted basis; or
except as permitted under ss.9.5,
Casual Male shall, at any time, legally or beneficially own
less than one hundred percent of the issued and outstanding capital
stock of each of TCM and TCMB&T, on a fully diluted basis;
then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Majority Lenders shall, by
notice in writing to the Borrowers declare all amounts owing with respect to
this Credit Agreement, the Notes and the other Loan Documents and all
Reimbursement Obligations to be, and they shall thereupon forthwith become,
immediately due and
49
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby expressly waived by the Borrowers; provided that in the event
of any Event of Default specified in ss.ss.14.1(g), 14.1(h) or 14.1(k), all such
amounts shall become immediately due and payable automatically and without any
requirement of notice from the Administrative Agent or any Lender; provided
further that in the event of any Event of Default specified in ss.ss.14.1(g),
14.1(h) or 14.1(k), the Total Commitments of the Lenders shall immediately
terminate and all such amounts owing shall become immediately due and payable
automatically and without any requirement of notice from the Administrative
Agent or the Lenders. No remedy herein conferred upon the Lenders is intended to
be exclusive of any other remedy and each and every remedy shall be cumulative
and shall be in addition to every other remedy given hereunder or now or
hereafter existing at law or in equity or by statute or any other provision of
law.
ss. Termination of Commitments.
If any one or more of the Events of Default specified in ss.14.1(g),
ss.14.1(h) or ss.14.1(k) shall occur, any unused portion of the Total Commitment
hereunder shall forthwith terminate and each of the Lenders shall be relieved of
all further obligations to make Loans to the Borrowers and the Acceptance Bank
and the Issuing Bank shall be relieved of all further obligations to issue,
extend or renew Credit Instruments and the Borrowers shall pay to the
Administrative Agent an amount equal to the sum of the Maximum Drawing Amount,
plus, the Acceptance Face Amount, plus all Unpaid Reimbursement Obligations to
be held by the Administrative Agent as cash collateral as contemplated by
ss.4.3(c). If any other Event of Default shall have occurred and be continuing,
or if on any Drawdown Date or other date for issuing, extending or renewing any
Credit Instrument the conditions precedent to the making of the Loans to be made
on such Drawdown Date or (as the case may be) to issuing, extending or renewing
such Credit Instrument on such date are not satisfied, the Administrative Agent
may and, upon the request of the Majority Lenders, shall, by notice to the
Borrowers, terminate the unused portion of the credit hereunder, and upon such
notice being given such unused portion of the credit hereunder shall terminate
immediately and each of the Lenders shall be relieved of all further obligations
to make Loans and the Acceptance Bank and the Issuing Bank shall be relieved of
all further obligations to issue, extend or renew Credit Instruments and the
Borrowers shall pay to the Administrative Agent an amount equal to the sum of
the Maximum Drawing Amount, plus, the Acceptance Face Amount, plus all Unpaid
Reimbursement Obligations to be held by the Administrative Agent as cash
collateral as contemplated by ss.4.3(c). No termination of the credit hereunder
shall relieve any Borrower or any of its Subsidiaries of any of the Obligations.
ss. Remedies.
In case any one or more of the Events of Default shall have occurred
and be continuing, and whether or not the Lenders shall have accelerated the
maturity of the Loans pursuant to ss.14.1, the Administrative Agent, may, with
the consent of the Majority Lenders but not otherwise, proceed to protect and
enforce the Lenders' rights by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant or
agreement contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to the Lenders are evidenced,
including as permitted by applicable law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Lender. No remedy herein conferred upon any
Lender, Acceptance Bank, Issuing Bank or the Administrative Agent or the holder
of any Note or purchaser of any Credit Instrument Participation is intended to
be exclusive of any other remedy and each
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and every remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by
statute or any other provision of law.
ss. Distribution of Collateral Proceeds.
In the event that, following the occurrence or during the
continuance of any Default or Event of Default, the Administrative Agent, the
Acceptance Bank, the Issuing Bank or any Lender, as the case may be, receives
any monies in connection with the enforcement of any of the Security Documents,
or otherwise with respect to the realization upon any of the Collateral, such
monies shall be distributed for application as follows:
First, to the payment of, or (as the case may be) the
reimbursement of the Agents for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agents in connection with the collection of such
monies by the Agents, for the exercise, protection or enforcement by
the Agents of all or any of the rights, remedies, powers and privileges
of the Agents under this Credit Agreement or any of the other Loan
Documents or in respect of the Collateral or in support of any
provision of adequate indemnity to the Agents against any taxes or
liens which by law shall have, or may have, priority over the rights of
the Agents to such monies;
Second, to all other Obligations in such order or preference
as the Majority Lenders may determine; provided, however, that
distributions in respect of such obligations shall be made (i) pari
passu among Obligations with respect to the Agents' fees payable
pursuant to ss.5.1 and all other Obligations and (ii) Obligations owing
to the Lenders with respect to each type of Obligation such as
interest, principal, fees and expenses, shall be made among the Lenders
pro rata; and provided, further, that the Administrative Agent may in
its discretion make proper allowance to take into account any
Obligations not then due and payable;
Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lenders and the
Administrative Agent of all of the Obligations, to the payment of any
obligations required to be paid pursuant to ss.9-504(1)(c) of the
Uniform Commercial Code of the Commonwealth of Massachusetts as in
effect from time to time; and
Fourth, the excess, if any, shall be returned to the Borrowers
or to such other Persons as are entitled thereto.
ss. SETOFF.
Regardless of the adequacy of any collateral, during the continuance
of any Event of Default, any deposits or other sums credited by or due from any
of the Lenders to any Obligor and any securities or other property of such
Obligor in the possession of such Lender may be applied to or set off by such
Lender against the payment of Obligations and any and all other liabilities,
direct, or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, of such Obligor to such Lender. Each of the Lenders agrees
with each other Lender that (a) if an amount to be set off is to be applied to
Indebtedness of the Obligors to such Lender, other than Indebtedness evidenced
by the Notes held by such Lender or constituting Reimbursement Obligations owed
to such Lender, such amount shall be applied ratably to such other Indebtedness
and to the Indebtedness evidenced by all such Notes held by such Lender or
constituting Reimbursement Obligations owed to such Lender, and (b) if such
Lender shall
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receive from any Obligor, whether by voluntary payment, exercise of the right of
setoff, counterclaim, cross action, enforcement of the claim evidenced by the
Notes held by, or constituting Reimbursement Obligations owed to, such Lender by
proceedings against such Obligor at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings, or
otherwise, and shall retain and apply to the payment of the Note or Notes held
by, or Reimbursement Obligations owed to, such Lender any amount in excess of
its ratable portion of the payments received by all of the Lenders with respect
to the Notes held by, and Reimbursement Obligations owed to, all of the Lenders,
such Lender will make such disposition and arrangements with the other Lenders
with respect to such excess, either by way of distribution, pro tanto assignment
of claims, subrogation or otherwise as shall result in each Lender receiving in
respect of the Notes held by it or Reimbursement Obligations owed to it, its
proportionate payment as contemplated by this Credit Agreement; provided that if
all or any part of such excess payment is thereafter recovered from such Lender,
such disposition and arrangements shall be rescinded and the amount restored to
the extent of such recovery, but without interest.
ss. THE AGENTS.
ss. Authorization.
The Administrative Agent is authorized to take such action on behalf
of each of the Acceptance Bank, the Issuing Bank and the Lenders and to exercise
all such powers as are hereunder and under any of the other Loan Documents and
any related documents delegated to the Administrative Agent, together with such
powers as are reasonably incident thereto, provided that no duties or
responsibilities not expressly assumed herein or therein shall be implied to
have been assumed by the Administrative Agent. The relationship between the
Administrative Agent and the Acceptance Bank, the Issuing Bank and the Lenders
is and shall be that of agent and principal only, and nothing contained in this
Credit Agreement or any of the other Loan Documents shall be construed to
constitute the Administrative Agent as a trustee for any Acceptance Bank, the
Issuing Bank or Lender. The Documentation Agent shall have no independent
powers, duties or obligations under this Credit Agreement.
ss. Employees and Agents.
The Administrative Agent may exercise its powers and execute its
duties by or through employees or agents and shall be entitled to take, and to
rely on, advice of counsel concerning all matters pertaining to its rights and
duties under this Credit Agreement and the other Loan Documents. The
Administrative Agent may utilize the services of such Persons as the
Administrative Agent in its sole discretion may reasonably determine, and all
reasonable fees and expenses of any such Persons shall be paid by the Borrowers.
ss. No Liability.
No Agent nor any of its shareholders, directors, officers or
employees nor any other Person assisting them in their duties nor any agent or
employee thereof, shall be liable for any waiver, consent or approval given or
any action taken, or omitted to be taken, in good faith by it or them hereunder
or under any of the other Loan Documents, or in connection herewith or
therewith, or be responsible for the consequences of any oversight or error of
judgment whatsoever, except that any Agent or such other Person, as the case may
be, may be liable for losses due to its willful misconduct or gross negligence.
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ss. No Representations.
(a) The Agents shall not be responsible for the execution or
validity or enforceability of this Credit Agreement, the Notes, any Credit
Instrument, any of the other Loan Documents or any instrument at any time
constituting, or intended to constitute, collateral security for the Notes, or
for the value of any such collateral security or for the validity,
enforceability or collectability of any such amounts owing with respect to the
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Obligors or any of their
Subsidiaries, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or in
any instrument at any time constituting, or intended to constitute, collateral
security for the Notes or to inspect any of the properties, books or records of
the Obligors or any of their Subsidiaries. The Agents shall not be bound to
ascertain whether any notice, consent, waiver or request delivered to it by the
Obligors or any holder of any of the Notes shall have been duly authorized or is
true, accurate and complete. No Agent has made or does it now make any
representations or warranties, express or implied, nor does it assume any
liability to the Lenders, with respect to the credit worthiness or financial
condition of the Obligors or any of their Subsidiaries. Each Acceptance Bank,
Issuing Bank and Lender acknowledges that it has, independently and without
reliance upon the Agents, the Arrangers, any Lender or any of their Affiliates,
and based upon such information and documents as it has deemed appropriate, made
its own credit analysis and decision to enter into this Credit Agreement.
(b) For purposes of determining compliance with the conditions
specified in ss.11 hereof of each Lender that has executed this Agreement shall
be deemed to have consented to, approved or accepted or to be satisfied with,
each document or other matter either sent (or made available) by any Agent to
such Lender for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory to
such Lender, unless an officer of the Administrative Agent contemplated by the
Loan Documents shall have received notice from such Lender prior to the Closing
Date specifying its objection thereto and such objection shall not have been
withdrawn by notice to the Administrative Agent to that effect on or prior to
the Closing Date.
ss. Payments.
A payment by the Obligors to the Administrative Agent hereunder or any
of the other Loan Documents for the account of the Acceptance Bank, the Issuing
Bank or any Lender shall constitute a payment to such Acceptance Bank, Issuing
Bank or Lender. The Administrative Agent agrees promptly to distribute to each
of the Acceptance Bank, the Issuing Bank and/or Lender such Acceptance Bank,
Issuing Bank and/or Lender's pro rata share of payments received by the
Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.
If in the opinion of the Administrative Agent the distribution of any
amount received by it in such capacity hereunder, under the Notes or under any
of the other Loan Documents might involve it in liability, it may refrain from
making distribution until its right to make distribution shall have been
adjudicated by a court of competent jurisdiction. If a court of competent
jurisdiction shall adjudge that any amount received and distributed by the
Administrative Agent is to be repaid, each Person to whom any such distribution
shall have been made shall either repay to the Administrative Agent its
proportionate
53
share of the amount so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
Notwithstanding anything to the contrary contained in this Credit
Agreement or any of the other Loan Documents, any Acceptance Bank, Issuing Bank
and/or Lender that fails (i) to make available to the Administrative Agent its
pro rata share of any Loan or to purchase a Credit Instrument Participation or
(ii) to comply with the provisions of ss.15 with respect to making dispositions
and arrangements with the other Lenders, where such Acceptance Bank, Issuing
Bank and/or Lender's share of any payment received, whether by setoff or
otherwise, is in excess of its pro rata share of such payments due and payable
to all of the Lenders, in each case as, when and to the full extent required by
the provisions of this Credit Agreement, shall be deemed delinquent (a
"Delinquent Lender") and shall be deemed a Delinquent Lender until such time as
such delinquency is satisfied. A Delinquent Lender shall be deemed to have
assigned any and all payments due to it from the Borrowers, whether on account
of outstanding Loans, Unpaid Reimbursement Obligations, interest, fees or
otherwise, to the remaining nondelinquent Lenders for application to, and
reduction of, their respective pro rata shares of all outstanding Loans and
Unpaid Reimbursement Obligations. The Delinquent Lender hereby authorizes the
Administrative Agent to distribute such payments to the nondelinquent Lenders in
proportion to their respective pro rata shares of all outstanding Loans and
Unpaid Reimbursement Obligations. A Delinquent Lender shall be deemed to have
satisfied in full a delinquency when and if, as a result of application of the
assigned payments to all outstanding Loans and Unpaid Reimbursement Obligations
of the nondelinquent Lenders, the Lenders' respective pro rata shares of all
outstanding Loans and Unpaid Reimbursement Obligations have returned to those in
effect immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
ss. Holders of Notes.
The Administrative Agent may deem and treat the payee of any Note or
the purchaser of any Credit Instrument Participation as the absolute owner or
purchaser thereof for all purposes hereof until it shall have been furnished in
writing with a different name by such payee or by a subsequent holder, assignee
or transferee.
ss. Indemnity.
The Acceptance Bank, the Issuing Bank and/or Lenders ratably agree
hereby to indemnify and hold harmless the Agents and the Arrangers from and
against any and all claims, actions and suits (whether groundless or otherwise),
losses, damages, costs, expenses (including any expenses for which the Agents or
the Arrangers have not been reimbursed by the Borrowers as required by ss.17),
and liabilities of every nature and character arising out of or related to this
Credit Agreement, the Notes, or any of the other Loan Documents or the
transactions contemplated or evidenced hereby or thereby, or the Agents' or
Arrangers' actions taken hereunder or thereunder, except to the extent that any
of the same shall be directly caused by an Agent's or Arranger's willful
misconduct or gross negligence.
ss. Agents as Lenders.
In their respective individual capacities, Fleet National Bank and
BankBoston, N.A. shall each have the same obligations and the same rights,
powers and privileges in respect to its respective Commitment and the Loans made
by it, and as the holder of any of the Notes and as the purchaser of
54
any Credit Instrument Participation, as it would have were it not also the
Administrative Agent and Documentation Agent, respectively.
ss. Resignation.
Any Agent may resign at any time by giving sixty (60) days' prior
written notice thereof to the Acceptance Bank, the Issuing Bank, the Lenders and
the Borrowers. Upon any such resignation, the Majority Lenders shall have the
right, in consultation with the Borrowers, to appoint a successor Agent. Unless
a Default or Event of Default shall have occurred and be continuing, such
successor Agent shall be reasonably acceptable to the Borrowers. If no successor
Agent shall have been so appointed by the Majority 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 financial institution
having a rating of not less than "A" or its equivalent by Standard & Poor's
Corporation. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, 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, the provisions of this Credit
Agreement and the other Loan Documents 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.
ss. Notification of Defaults and Events of Default.
Each Acceptance Bank, Issuing Bank and Lender hereby agrees that,
upon learning of the existence of a Default or an Event of Default, it shall
promptly notify the Administrative Agent thereof. The Administrative Agent
hereby agrees that upon receipt of any notice under this ss.16.10 it shall
promptly notify the Acceptance Bank, the Issuing Bank and the others Lenders (as
the case may be) of the existence of such Default or Event of Default.
ss. Duties in the Case of Enforcement.
In case of one or more Events of Default have occurred and shall be
continuing, and whether or not acceleration of the Obligations shall have
occurred, the Administrative Agent shall, if (a) so requested by the Majority
Lenders and (b) the Lenders have provided to the Administrative Agent such
additional indemnities and assurances against expenses and liabilities as the
Administrative Agent may reasonably request, proceed to enforce the provisions
of the Security Documents authorizing the sale or other disposition of all or
any part of the Collateral and exercise all or any such other legal and
equitable and other rights or remedies as it may have in respect of such
Collateral. The Majority Lenders may direct the Administrative Agent in writing
as to the method and the extent of any such sale or other disposition, the
Lenders hereby agreeing to indemnify and hold the Administrative Agent, harmless
from all liabilities incurred in respect of all actions taken or omitted in
accordance with such directions, provided that the Administrative Agent need not
comply with any such direction to the extent that the Administrative Agent
reasonably believes the Administrative Agent's compliance with such direction to
be unlawful or commercially unreasonable in any applicable jurisdiction. Each
Lender agrees that, notwithstanding any other term to the contrary contained
herein, it will not have any right individually to enforce or seek to enforce
this Agreement or any of the other Loan Documents or to realize upon any
Collateral for the Loans, it being understood and agreed that such rights and
remedies may be exercised only by the Administrative Agent.
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ss. EXPENSES.
The Borrowers agree to pay (a) the reasonable out-of-pocket costs of
producing and reproducing this Credit Agreement, the other Loan Documents and
the other agreements and instruments mentioned herein, (b) any taxes (including
any interest and penalties in respect thereto) payable by any Agent, any of the
Lenders, the Acceptance Bank, the Issuing Bank or any of their affiliates (other
than taxes based upon any Agent's, any Lender's, the Acceptance Bank, the
Issuing Bank or any affiliate's net income) on or with respect to the
transactions contemplated by this Credit Agreement (the Borrowers hereby
agreeing to indemnify the each Agent, each Lender, the Acceptance Bank, the
Issuing Bank and each affiliate with respect thereto), (c) the reasonable
out-of-pocket fees, expenses and disbursements of the Administrative Agent's
Special Counsel or any local counsel to the Administrative Agent incurred in
connection with the preparation, administration or interpretation of the Loan
Documents and other instruments mentioned herein, each closing hereunder, and
amendments, modifications, approvals, consents or waivers hereto or hereunder,
(d) the reasonable out-of-pocket fees, expenses and disbursements incurred by
the Agents and the Arrangers in connection with the preparation, syndication,
administration or interpretation of the Loan Documents and other instruments
mentioned herein, including all commercial finance examination charges, (e) all
reasonable out-of-pocket expenses (including without limitation reasonable
attorneys' fees and costs, which attorneys may be employees of the
Administrative Agent, and reasonable consulting, accounting, appraisal,
investment banking and similar professional fees and charges) incurred by the
Administrative Agent in connection with (i) the out-of-pocket expenses incurred
in connection with the enforcement of or preservation of rights under any of the
Loan Documents against the Obligors or any of their Subsidiaries or the
administration thereof after the occurrence of a Default or Event of Default and
(ii) any out-of-pocket expenses incurred in connection with litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way related
to any Lender's, any Agent's, the Acceptance Bank, the Issuing Bank or any of
their affiliates relationship with the Borrowers or any of their Subsidiaries,
(f) in the event that a Default or Event of Default shall have occurred and be
continuing, all reasonable out-of-pocket expenses (including without limitation
reasonable attorneys' fees and costs, which attorneys may be employees of any
Lender, any Agent, the Issuing Bank or the Acceptance Bank, and reasonable
consulting, accounting, appraisal, investment banking and similar professional
fees and charges) incurred by any Lender, any Agent, the Issuing Bank or the
Acceptance Bank, in connection with (i) the out-of-pocket expenses incurred in
connection with the enforcement of or preservation of rights under any of the
Loan Documents against the Obligors or any of their Subsidiaries or the
administration thereof after the occurrence of a Default or Event of Default and
(ii) any out- of-pocket expenses incurred in connection with litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way related
to any Lender's, any Agent's, the Acceptance Bank, the Issuing Bank or any of
their affiliates relationship with the Borrowers or any of their Subsidiaries
and (g) all reasonable fees, expenses and disbursements of any Lender or any
Agent incurred in connection with UCC searches, UCC filings or mortgage
recordings. The covenants of this ss.17 shall survive payment or satisfaction of
all other Obligations.
ss. INDEMNIFICATION.
The Obligors agree to indemnify and hold harmless the Agents, the
Arrangers, the Lenders, the Acceptance Bank, the Issuing Bank and their
affiliates from and against any and all claims, actions and suits whether
groundless or otherwise, and from and against any and all liabilities, losses,
damages and expenses of every nature and character arising out of this Credit
Agreement or any of the other Loan Documents or the transactions contemplated
hereby including, without limitation, (a) any actual or proposed use by the
Borrowers or any of their Subsidiaries of the proceeds of any of the Loans or
any
56
Credit Instrument, (b) the syndication of the credit facility contemplated
hereby and by the other Loan Documents (c) the Obligors or any of their
Subsidiaries entering into or performing this Credit Agreement or any of the
other Loan Documents or (d) with respect to the Apparel Obligors and their
respective properties and assets, the violation of any Environmental Law, in
each case including, without limitation, the reasonable fees and disbursements
of counsel incurred in connection with any such investigation, litigation or
other proceeding. In litigation, or the preparation therefor, the Agents, the
Arrangers, the Lenders, the Acceptance Bank, the Issuing Bank and their
affiliates shall be entitled to select their own counsel and, in addition to the
foregoing indemnity, the Obligors agree to pay promptly the reasonable fees and
expenses of such counsel. If, and to the extent that the obligations of the
Obligors under this ss.18 are unenforceable for any reason, the Obligors hereby
agree to make the maximum contribution to the payment in satisfaction of such
obligations which is permissible under applicable law. The covenants contained
in this ss.18 shall survive payment or satisfaction in full of all other
Obligations provided, however, that the Obligors and their Subsidiaries shall
have no obligation hereunder to any Agent or any Arranger, Issuing Bank,
Acceptance Bank or Lender with respect to indemnified liabilities arising from
the gross negligence or willful misconduct of any such Agent, Arranger or any
such Issuing Bank, Acceptance Bank or Lender.
ss. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made
herein, in the Notes, in any of the other Loan Documents or in any documents or
other papers delivered by or on behalf of the Obligors or any of their
Subsidiaries pursuant hereto shall be deemed to have been relied upon by the
Acceptance Bank, the Issuing Bank, the Lenders and the Agents, notwithstanding
any investigation heretofore or hereafter made by any of them, and shall survive
the making by the Lenders of any of the Loans and the Acceptance Bank's and the
Issuing Bank's issuance, extension or renewal of any Credit Instrument, as
herein contemplated, and shall continue in full force and effect so long as any
Credit Instrument or amount due under this Credit Agreement or the Notes or any
of the other Loan Documents remains outstanding or any Lender has any obligation
to make any Loans hereunder or the Acceptance Bank or the Issuing Bank has any
obligation to issue, extend or renew any Credit Instrument, and for such further
time as may be otherwise expressly specified in this Credit Agreement. All
statements contained in any certificate or other paper delivered to any Lender
or any Agent at any time by or on behalf of any Obligor or any of its
Subsidiaries pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by such Obligor or such
Subsidiary hereunder.
ss. ASSIGNMENT AND PARTICIPATION.
ss. Conditions to Assignment by Lenders.
Except as provided herein, each Lender may assign to one or more
Eligible Assignees all or a portion of its interests, rights and obligations
under this Credit Agreement (including all or a portion of its Commitment
Percentage and Commitment and the same portion of the Loans at the time owing to
it and the Notes held by it and its participation interest in the risk relating
to any Credit Instrument); provided that (a) each of the Issuing Bank, the
Administrative Agent and, if no Event of Default shall have occurred and be
continuing, the Obligors, shall have given its prior written consent to such
assignment (such consents not to be unreasonably withheld), (b) each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Lender's rights and obligations under this Credit Agreement, (c) each
assignment shall be in an amount not less than $5,000,000, or such lesser
57
amount provided that both Agents have given their prior written consent to any
such lesser amount and further provided, that any such lesser amounts assigned
to an Eligible Assignee shall in the aggregate equal not less than $5,000,000,
and (d) the parties to such assignment shall execute and deliver to the
Administrative Agent, for recording in the Register (as hereinafter defined), an
Assignment and Acceptance, substantially in the form of Exhibit C hereto (an
"Assignment and Acceptance"), together with any Notes subject to such
assignment. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, (i) the assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Acceptance, have the rights and obligations of a
Lender hereunder, and (ii) the assigning Lender shall, to the extent provided in
such assignment and upon payment to the Administrative Agent of the registration
fee referred to in ss.20.3, be released from its obligations under this Credit
Agreement.
ss. Certain Representations and Warranties; Limitations; Covenants.
By executing and delivering an Assignment and Acceptance, the
parties to the assignment thereunder confirm to and agree with each other and
the other parties hereto as follows: (a) other than the representation and
warranty that it is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim, the assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto; (b) the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Obligors and their
Subsidiaries or any other Person primarily or secondarily liable in respect of
any of the Obligations, or the performance or observance by the Obligors and
their Subsidiaries or any other Person primarily or secondarily liable in
respect of any of the Obligations of any of their obligations under this Credit
Agreement or any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; (c) such assignee confirms that it has
received a copy of this Credit Agreement, together with copies of the most
recent financial statements referred to in ss.7.5 and ss.8.4 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (d) such
assignee will, independently and without reliance upon the assigning Lender, the
Administrative 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
credit decisions in taking or not taking action under this Credit Agreement; (e)
such assignee represents and warrants that it is an Eligible Assignee; (f) such
assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Credit Agreement and
the other Loan Documents as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto; (g) such assignee agrees that it will perform in accordance with their
terms all of the obligations that by the terms of this Credit Agreement are
required to be performed by it as a Lender; (h) such assignee represents and
warrants that it is legally authorized to enter into such Assignment and
Acceptance; and (i) such assignee acknowledges that it has made arrangements
with the assigning Lender satisfactory to such assignee with respect to its pro
rata share of Letter of Credit Fees in respect of outstanding Credit
Instruments.
ss. Register.
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The Administrative Agent shall maintain a copy of each Assignment
and Acceptance delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Lenders and the Commitment
Percentage of, and principal amount of the Loans owing to, and Credit Instrument
Participations purchased by, the Lenders from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Obligors, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of this
Credit Agreement. The Register shall be available for inspection by the Obligors
and the Lenders at any reasonable time and from time to time upon reasonable
prior notice. Upon each such recordation, the assigning Lender agrees to pay to
the Administrative Agent a registration fee in the sum of $2,500.00.
ss. New Notes.
Upon its receipt of an Assignment and Acceptance executed by the
parties to such assignment, together with each Note subject to such assignment,
the Administrative Agent shall (a) record the information contained therein in
the Register, and (b) give prompt notice thereof to the Borrowers and the
Lenders (other than the assigning Lender). Within ten (10) days after receipt of
such notice, the Borrowers, at their own expense, shall execute and deliver to
the Administrative Agent, in exchange for each surrendered Note, a new Note to
the order of such Eligible Assignee in an amount equal to the amount assumed by
such Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Lender has retained some portion of its obligations hereunder, a new
Note to the order of the assigning Lender in an amount equal to the amount
retained by it hereunder. Such new Notes shall provide that they are
replacements for the surrendered Notes, shall be in an aggregate principal
amount equal to the aggregate principal amount of the surrendered Notes, shall
be dated the effective date of such in Assignment and Acceptance and shall
otherwise be substantially the form of the assigned Notes.
ss. Participations.
Each Lender may sell participations to one or more banks or other
entities in all or a portion of such Lender's rights and obligations under this
Credit Agreement and the other Loan Documents; provided that (a) any such sale
or participation shall not affect the rights and duties of the selling Lender
hereunder to the Borrowers and (b) the only rights granted to the participant
pursuant to such participation arrangements with respect to waivers, amendments
or modifications of the Loan Documents shall be the rights to approve waivers,
amendments or modifications that would reduce the principal of or the interest
rate on any Loans, extend the term or increase the amount of the Commitment of
such Lender as it relates to such participant, reduce the amount of any facility
fees or Letter of Credit Fees or Bankers' Acceptance Fees to which such
participant is entitled or extend any regularly scheduled payment date for
principal or interest.
ss. Disclosure.
The Obligors agree that in addition to disclosures made in
accordance with standard and customary banking practices any Lender may disclose
information obtained by such Lender pursuant to this Credit Agreement to
assignees or participants and potential assignees or participants hereunder;
provided that such assignees or participants or potential assignees or
participants shall agree in writing (a) to treat in confidence such information,
(b) not to disclose such information to a third party and (c) not to make use of
such information for purposes of transactions unrelated to such contemplated
assignment or participation.
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ss. Assignee or Participant Affiliated with the Obligors.
If any assignee Lender is an Affiliate of the Obligors, then any
such assignee Lender shall have no right to vote as a Lender hereunder or under
any of the other Loan Documents for purposes of granting consents or waivers or
for purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Administrative Agent
pursuant to ss.14.1 or ss.14.2, and the determination of the Majority Lenders
shall for all purposes of this Agreement and the other Loan Documents be made
without regard to such assignee Lender's interest in any of the Loans. If any
Lender sells a participating interest in any of the Loans or Reimbursement
Obligations to a participant, and such participant is an Obligor or an Affiliate
of an Obligor, then such transferor Lender shall promptly notify the
Administrative Agent of the sale of such participation. A transferor Lender
shall have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Administrative Agent pursuant to ss.14.1 or
ss.14.2 to the extent that such participation is beneficially owned by any
Obligor or any Affiliate of such Obligor, and the determination of the Majority
Lenders shall for all purposes of this Agreement and the other Loan Documents be
made without regard to the interest of such transferor Lender in the Loans to
the extent of such participation.
ss. Miscellaneous Assignment Provisions.
If any assignee Lender is not incorporated under the laws of the
United States of America or any state thereof, it shall, prior to the date on
which any interest or fees are payable hereunder or under any of the other Loan
Documents for its account, deliver to the Borrowers and the Administrative Agent
certification as to its exemption from deduction or withholding of any United
States federal income taxes. If Fleet transfers all of its interest, rights and
obligations under this Credit Agreement, the Administrative Agent shall, in
consultation with the Borrowers and with the consent of the Borrowers and the
Majority Lenders, appoint another Lender to act as a reference bank hereunder.
Anything contained in this ss.20 to the contrary notwithstanding, any Lender may
at any time pledge all or any portion of its interest and rights under this
Credit Agreement (including all or any portion of its Notes) to any of the
twelve Federal Reserve Lenders organized under ss.4 of the Federal Reserve Act,
12 U.S.C. ss.341. No such pledge or the enforcement thereof shall release the
pledgor Lender from its obligations hereunder or under any of the other Loan
Documents.
ss. Assignment by Obligors.
No Obligor shall assign or transfer any of its rights or obligations
under any of the Loan Documents without the prior written consent of each of the
Lenders.
ss. Marshalling; Payments Set Aside.
Neither the Agents not any Lender shall be under any obligation to
marshal any assets in favor of the Obligors or any other party or against or in
payment of any or all of the Obligations. To the extent that any Obligor makes a
payment or payments to the Administrative Agent or any Lender (or to the
Administrative Agent for the benefit of any Lender), or the Administrative Agent
or any Lender enforces any security interest or exercises rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any
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bankruptcy law, any other state or federal law, common law or any equitable
cause, then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement setoff had not
occurred.
ss. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Application shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent by overnight courier, or sent
by telegraph, telecopy, facsimile or telex and confirmed by delivery via courier
or postal service, addressed as follows:
if to the Obligors, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, Attention: Xx. Xxxxxx X. Xxxxxxxxx, Chief Financial Officer, or
at such other address for notice as the Obligors shall last have
furnished in writing to the Person giving the notice, with a copy
delivered to Xxxxxxx, Procter & Xxxx XXX, Xxxxxxxx Xxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention:
Xxxxxxx X. Xxxxxx, Esq.;
if to the Administrative Agent, at Xxx Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxxxx Xxxxxxx, Assistant Vice
President, or such other address for notice as the Administrative Agent
shall last have furnished in writing to the Person giving the notice;
if to the Documentation Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxxx X. Xxxxxx, Managing Director,
or such other address for notice as the Documentation Agent shall last
have furnished in writing to the Person giving the notice; and
if to any Lender, at such Lender's address set forth on
Schedule 1 hereto, or such other address for notice as such Lender
shall have last furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
ss. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS, ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF
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SAID COMMONWEALTH OF MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS
OR CHOICE OF LAW). EACH OBLIGOR AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS
CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS
OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS
IN ANY SUCH SUIT BEING MADE UPON THE OBLIGORS BY MAIL AT THE ADDRESS SPECIFIED
IN ss.21. EACH OBLIGOR HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT IN THE COMMONWEALTH OF
MASSACHUSETTS OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
ss. HEADINGS.
The captions in this Credit Agreement are for convenience of
reference only and shall not define or limit the provisions hereof.
ss. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Credit Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.
ss. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in ss.27.
ss. WAIVER OF JURY TRIAL.
Each Obligor, as an inducement to the Administrative Agent and the
Lenders to enter into this Credit Agreement, hereby waives its right to a jury
trial with respect to any action or claim arising out of any dispute in
connection with this Credit Agreement, the Notes or any of the other Loan
Documents, any rights or obligations hereunder or thereunder or the performance
of which rights and obligations. Except as prohibited by law, each Obligor
hereby waives any right it may have to claim or recover in any litigation
referred to in the preceding sentence any special, exemplary, punitive or
consequential damages or any damages other than, or in addition to, actual
damages. Each Obligor (a) certifies that no representative, agent or attorney of
any Lender or the Administrative Agent has represented, expressly or otherwise,
that such Lender or the Administrative Agent would not, in the event of
litigation, seek to enforce the foregoing waivers and (b) acknowledges that the
Administrative Agent and the Lenders have been induced to enter into this Credit
Agreement, the other Loan Documents to which it is a party and by, among other
things, the waivers and certifications contained herein.
ss. CONSENTS, AMENDMENTS, WAIVERS, ETC.
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Neither this Credit Agreement, any of the Loan Documents, nor any
term hereof or thereof may be amended, nor may any provision hereof or thereof
be waived, except by an instrument in writing signed by the Majority Lenders
and, in the case of an amendment, by the Obligors, except that in the event of
(i) any increase in the amount of any Commitment (other than by way of
assignment pursuant to ss.20 hereof), (ii) any delay or extension in the terms
of or any scheduled reduction of Commitments or repayment of the Loans as
provided in ss.2.4 hereof, (iii) any reduction in principal, interest or fees
due hereunder or postponement of the payment thereof, (iv) any release of any
portion of the Collateral for the Loans except as permitted in ss.9.5 hereof,
(v) any waiver of any Default or Event of Default due to the failure by the
Obligors to pay any sum due to any of the Lenders hereunder, (vi) any release of
the Guarantor hereunder or under any of the Loan Documents, or (vii) any
amendment of this ss.27 or of the definition of Majority Lenders or of any
portion of this Credit Agreement as they relate to the relative priorities of
payment among the Obligations or of the amount of the Administrative Agent's
fee, any such amendment or waiver or consent may be made only by an instrument
in writing signed by each of the Lenders and, in the case of an amendment, by
the Obligors.
Any amendment to any provision hereunder or under any other Loan Document
governing the rights, obligations or liabilities of any Agent or the Issuing
Bank, including, without limitation, Bankers' Acceptance fees, the Letter of
Credit Fees in each case in its capacity as such, will be effective only if any
instrument in writing has been signed by such affected Person. No waiver shall
extend to or affect any obligation not expressly waived or impair any right
consequent thereon. No course of dealing or delay or omission on the part of the
Administrative Agent or any Lender in exercising any right shall operate as a
waiver thereof or otherwise be prejudicial thereto. No notice to or demand upon
the Obligors shall entitle the Obligors to other or further notice or demand in
similar or other circumstances.
ss. TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY.
(a) Each of the Obligors acknowledges that from time to time
financial advisory, investment banking and other services may be offered or
provided to the Obligors or one or more of their Subsidiaries (in connection
with this Credit Agreement or otherwise) by any Section 20 Subsidiary and each
of the Obligors hereby authorizes each Lender to share any information delivered
to such Lender by the Section 20 Subsidiary pursuant to this Credit Agreement,
or in connection with the decision of such Lender to enter into this Credit
Agreement, to any such Section 20 Subsidiary, it being understood that any such
Section 20 Subsidiary receiving such information shall be bound by the
confidentiality provisions of this Credit Agreement. Such authorization shall
survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments.
(b) Each of the Lenders and the Agents agree (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Guarantor or the Borrowers pursuant
to this Credit Agreement that is identified by such Person as being confidential
at the time the same is delivered to the Lenders or the Administrative Agent,
provided that nothing herein shall limit the disclosure of any such information
(i) after such information shall have become public (other than through a
violation of this ss.28, (ii) to the extent required by statute, rule,
regulation or judicial process, (iii) to counsel for any of the Lenders or the
Agents, (iv) to bank examiners (or any other regulatory authority having
jurisdiction over any Lender or Agent), or to auditors or accountants, (v) to
the Agents or any other Lender, (vi) in connection with any
63
litigation to which any one or more of the Lenders or the Agents is a party, or
in connection with the enforcement of rights or remedies hereunder or under any
other Loan Document, (vii) to a Subsidiary or affiliate of any such Lender as
provided in paragraph (a) above or (viii) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first executes and delivers to the
respective Lender a Confidentiality Agreement in form and substance satisfactory
to the Agents (a "Confidentiality Agreement") (or executes and delivers to such
Lender an acknowledgment to the effect that it is bound by the provisions of
this ss.28(b), which acknowledgment may be included as part of the respective
assignment or participation agreement pursuant to which such assignee or
participant acquires an interest in the Loans or Credit Instrument hereunder);
provided, further, that (x) unless specifically prohibited by applicable law or
court order, each Lender and the Agents shall, prior to disclosure thereof,
notify the Borrowers of any request for disclosure of any such non-public
information (A) by any governmental agency or representative thereof (other than
any such request in connection with an examination of the financial condition of
such Lender by such governmental agency) or (B) pursuant to legal process and
(y) in no event shall any Lender or the Agents be obligated or required to
return any materials furnished by the Guarantor or the Borrowers. The
obligations of each Lender under this ss.28 shall supersede and replace the
obligations of such Lender under the confidentiality letter in respect of this
financing signed and delivered by such Lender to the Borrowers prior to the date
hereof, in addition, the obligations of any assignee that has executed a
Confidentiality Agreement shall be superseded by this ss.28 upon the date upon
which such assignee becomes a Lender hereunder pursuant to ss.20 hereof.
ss. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or in
part in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and shall
not in any manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Credit Agreement in any jurisdiction.
ss. NOTICE FROM BORROWERS.
Any notice given or made by any Borrower under this Credit Agreement
or any of the other Loan Documents shall be deemed to have been given or made by
all of the Borrowers.
IN WITNESS WHEREOF, the undersigned have caused this Credit Agreement
to be duly executed as a sealed instrument as of the date first set forth above.
THE CASUAL MALE, INC.
By:/s/ Xxxxxx Xxxxxxxxx
Its: Executive Vice President
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TCM HOLDING CO., INC.
By:/s/ Xxxxxx Xxxxxxxxx
Its: Executive Vice President
WGS CORP.
By:/s/ Xxxxxx Xxxxxxxxx
Its: Executive Vice President
TCMB&T, INC.
By:/s/ Xxxxxx Xxxxxxxxx
Its: Executive Vice President
X. XXXXX, INC.
By:/s/ Xxxxxx Xxxxxxxxx
Its: Executive Vice President
FLEET NATIONAL BANK,
individually and as Administrative Agent
By: /s/Xxxxxxx Xxxxxxx
Its Vice President
BANKBOSTON, N.A.,
individually and as Documentation Agent
By: /s/Xxxxx Xxxxxx
Its Managing Director
65
THE CHASE MANHATTAN BANK
By: /s/Xxxxx X. Xxxxx
Its Senior Vice President
IMPERIAL BANK
By: Xxxxx Xxxxxxx
Its Vice President
USTRUST
By: /s/Xxxxxx X. Xxxxxx
Its Vice President
XXXXXXXXXX BANK &
TRUST COMPANY
By:/s/Xxxxxx X. Xxxxxxx
Its Senior Vice President
