REIMBURSEMENT AGREEMENT
between
Sesvenna 20. Vermogensverwaltungs
(in the process of being renamed CFC EUROPE GMBH)
and
LASALLE BANK NATIONAL ASSOCIATION
Dated as of March 19, 1999
REIMBURSEMENT AGREEMENT
This Reimbursement Agreement (this "Agreement") dated as of the 19th
day of March, 1999 is by and between Sesvenna 20. Vermogensverwaltungs GmbH (in
the process of being renamed CFC EUROPE GMBH), a German corporation (the
"Company") and LASALLE BANK NATIONAL ASSOCIATION, a national banking association
(the "Bank").
W I T N E S S E T H:
WHEREAS, the Company has entered into that certain letter agreement
(the "ABN Loan Documents") with ABN AMRO Bank (Deutschland) AG ("ABN AMRO")
providing for a DM 7,500,000 line of credit (the "Line of Credit") and a DM
11,000,000 term loan (the "Term Loan"; the Term Loan and the Line of Credit are
collectively referred to as the "Loans");
WHEREAS, the Company has requested that Bank cause LaSalle National
Bank ("L/C Bank") to issue an irrevocable standby letter of credit in the form
of Attachment A hereto (such letter of credit, as amended, modified or otherwise
supplemented from time to time, is referred to herein as the "Letter of Credit")
in favor of ABN AMRO to secure the obligations and liabilities of the Company to
ABN AMRO under the ABN Loan Documents, with such Letter of Credit to be in an
amount not exceeding DM 19,425,000 (the "Stated Amount"); and
WHEREAS, the parties hereto desire to enter into this Agreement in
order to, among other things, provide for the issuance of the Letter of Credit
and certain of the terms and conditions relating thereto;
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS. For the purpose of this Agreement, capitalized terms
used herein and not otherwise defined shall have the meanings assigned to them
in the other Loan Documents. In addition to terms defined elsewhere herein, the
following terms shall have the following meanings:
"Affiliate" of any Person shall mean any other Person which, directly
or indirectly, controls, is controlled by, or is under common control with such
Person. A Person shall be deemed to be "controlled by" any other Person if such
other Person possesses, directly or indirectly, the power
(1) to vote securities having fifty percent (50%) or more voting power
(on a fully diluted basis) for the election of directors
or managing general partners; or
(2) to direct or cause the direction of the management and policies of such
Person, whether by contract or otherwise.
"Authorized Officer" means, in the case of a corporation, the Chairman,
the Managing Director, the President, any Executive Vice-President, Vice
President of Finance, any Vice President or the Treasurer of the specified
corporation.
"Business Day" means any day other than (A) a Saturday, Sunday, or (B)
a day on which banking institutions located in Chicago, Illinois, are required
or are authorized by law or executive order to close.
"Certifying Officer" shall mean the Secretary or an Assistant Secretary
of the specified corporation.
"Date of Issuance" shall mean the date of issuance and delivery of the
Letter of Credit.
"Default" shall mean any event which with notice or lapse of time, or
both, would become an Event of Default.
"DM" or "Deutsche Xxxx" shall mean lawful currency of the Federal
Republic of Germany.
"Event of Default" shall have the meaning assigned to such term in
Section 10 hereof.
"Expiration Date" means the last day a drawing is available under the
Letter of Credit by operation of its terms, or as defined herein in subsection
3(f) hereof.
"Initial Stated Amount" shall mean the Stated Amount of the Letter of
Credit on the Date of Issuance.
"Loan Documents" means this Agreement, the Pledge, the ABN Loan
Documents, and all instruments, documents and agreements executed in connection
herewith or therewith, as the same may be amended, modified, supplemented or
restated from time to time, and "Loan Document" shall mean any one of the
foregoing.
"Obligations" shall mean all indebtedness, liabilities,
responsibilities and obligations, whether now existing or hereafter arising,
primary or contingent, owing to the Bank or the L/C Bank by the Company, whether
pursuant to this Agreement, any guaranty in favor of Bank by any Subsidiary or
the Company, by assignment, participation or otherwise, and all covenants,
agreements and obligations, whether now existing or hereafter arising, to be
performed or observed in favor of the Bank by the Company, whether pursuant to
this Agreement or otherwise.
"Person" shall mean any natural person, joint venture, trust,
unincorporated organization, firm, association, corporation, institution,
entity, partnership, public body or governmental body of any kind whatsoever.
"Prime Rate" means for any day the rate of interest announced by the
Bank from time to time as its prime rate which is not intended to be the Bank's
lowest or most favorable rate of interest at any one time. The effective date of
any change in the Prime Rate shall be for purposes hereof the date any change in
the Prime Rate is announced or quoted by the Bank.
"Subsidiary" means, with respect to any Person, any corporation of
which the outstanding capital stock having more than fifty percent (50%) of the
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person, by such
Person and one or more other Subsidiaries of such Person or by one or more other
Subsidiaries of such Person.
SECTION 2. ISSUANCE OF THE LETTER OF CREDIT. The Bank agrees to cause the L/C
Bank to issue on the date of execution and delivery of this Agreement, upon the
terms, subject to the satisfaction of the conditions and relying upon the
representations and warranties set forth in this Agreement, the Letter of Credit
in substantially the form of Attachment A hereto. The Letter of Credit shall
initially be in a Stated Amount of DM 19,425,000 (the "Stated Amount").
SECTION 3. REIMBURSEMENT AND OTHER PAYMENTS.
(1) Reimbursement and Interest. The payment of a draft under the Letter of
Credit shall constitute a loan to and indebtedness of the Company and the
Company hereby agrees to pay to the Bank (i) the full amount of all drawings
made under the Letter of Credit immediately upon payment by the L/C Bank, of
each such drawing and on the date of each such payment and (ii) on demand, any
and all reasonable charges and expenses which the Bank or L/C Bank may pay or
incur relative to the Letter of Credit and any and all reasonable expenses
incurred by the Bank in enforcing any rights under this Agreement, including,
but not limited to, reasonable attorneys' fees incurred by the Bank in enforcing
any of such rights. If the Company does not make such reimbursements on the date
due or demanded, in addition to any Event of Default resulting therefrom, such
reimbursement obligations shall bear interest at the rate per annum specified in
Section 3(h) hereof.
(2) Commission and Other Fees. The Company hereby agrees to pay the following
amounts to the Bank:
(1) an annual Letter of Credit fee in the amount of .75% per
annum of the Stated Amount, or such lesser face amount as the Letter of
Credit has been reduced to as of the date of any such payment, payable in
advance, on the Date of Issuance and on each anniversary thereof hereafter;
(2) a transaction fee in an amount equal to the greater of
(a) one-eighth of one percent (1/8 of 1%) of any amount drawn under
the Letter of Credit to pay principal or interest or expenses on the
Loans, or (b) $200, plus, in either case, any applicable wire transfer and
special handling charges of the L/C Bank, payable when such drawing has
been paid by the L/C Bank;
(3) all customary fees and administrative expenses of the Bank
or L/C Bank in connection with the issuance, transfer, maintenance,
modification (if any) and administration of the Letter of Credit,
payable upon demand from time to time; and
(4) a commitment fee in the amount of .5% of the Stated Amount,
payable on the Date of Issuance.
(3) Computation of Interest. Interest payable hereunder shall be computed on the
basis of a year of 360 days, for the actual number of days elapsed (including
the first day and excluding the last day). Whenever any payment under this
Agreement shall be due on any day that is not a Business Day, the date for
payment thereof shall be extended to the next succeeding Business Day. If the
due date for any such payment is so extended or extended for any other reason,
including operation of law, interest shall accrue and be payable for such
extended time.
(4) Change in Law, Compensation.
(1) If any change in any law, regulation, guideline or directive
(whether or not having the force of law) or in the interpretation thereof
by any court or administrative or governmental authority charged with the
administration thereof shall either (1) impose, modify or deem
applicable any reserve, special deposit or similar requirement against
letters of credit issued by the Bank or the L/C Bank, or any advance or
forbearance in respect of the reimbursement obligations of the Company
under this Agreement (an "Advance") or (2) impose on the Bank or the
L/C Bank any other condition regarding this Agreement, the Letter of
Credit and the result of any event referred to in clause (1) or (2)
above shall be to increase the cost to the Bank or L/C Bank of issuing
or maintaining the Letter of Credit (which increase in cost shall be
the reasonable allocation of the aggregate of such cost increases
resulting from such events), then, upon demand by the Bank, the Company
shall immediately pay to the Bank or the L/C Bank from time to time as
specified by such party, additional amounts which shall be sufficient
to compensate such party for such increased cost from the date of such
change, together with interest on each such amount from the date
demanded until payment in full thereof at the rate provided in clause
(ii) of paragraph (a) above. A certificate setting forth in reasonable
detail such increased cost incurred by any such party as a result of
any event mentioned in clause (1) or (2) above, submitted by such party
to the Company, shall be conclusive, absent manifest error, as to the
amount thereof.
(2) If any change in any law, regulation, guideline or directive
(whether or not having the force of law) or in the interpretation thereof
by any court or administrative or governmental authority charged with
the administration thereof shall prohibit or restrict the making of any
drawing under the Letter of Credit, maintaining as outstanding any loan
on behalf of the Company or the charging of interest on such loan, the
Company agrees that the Bank or the L/C Bank shall have the right to
comply with such prohibition or restriction and require repayment in
full of each loan together with accrued interest thereon. A certificate
setting forth the details concerning the foregoing submitted by the
Bank or the L/C Bank to the Company shall be conclusive, absent
manifest error, as to such matters.
(5) Time and Place of Payment. All payments by the Company to the Bank hereunder
shall be made by 12:00 noon (Chicago time) on the date due in lawful currency of
the United States, in immediately available funds, to the Chicago office of the
Bank at 0000 Xxxx Xxxxxx Xxxx Xxxx, Xxxxxxx, Xxxxxxxx 00000 in an amount equal
to the U.S. Dollar equivalent of the amount in DM paid by the L/C Bank under the
Letter of Credit to ABN AMRO, at the exchange rate in effect on the date of the
payment by the L/C Bank.
(6) Expiration. The Expiration Date of the Letter of Credit shall be the earlier
of (i) the later of the close of banking business in Chicago on April 15, 2004,
or such later date as the Letter of Credit has been extended to in accordance
with its terms (the "Stated Expiration Date"), or if such day is not a Business
Day, then the next succeeding Business Day; and (ii) the close of business on
the date on which the Loans have been indefeasibly paid in full.
(7) Non-Usurious Interest Rate. It is the intention of the Bank and the Company
to comply with the laws of the State of Illinois and notwithstanding any
provision to the contrary contained herein, the Company shall not be required to
pay, and the Bank shall not be permitted to collect any interest (or fees
determined to constitute interest) in an amount in excess of, the maximum
non-usurious amount of interest permitted by applicable law ("Excess Interest").
If any Excess Interest is provided for or determined to have been provided for
under this Agreement by a court of competent jurisdiction, then in such event
(i) the provisions of this subsection 3(g) shall govern and control; (ii)
neither the Company nor any endorser shall be obligated to pay any Excess
Interest; (iii) any Excess Interest that the Bank may have received hereunder
shall be, at Bank's option, (1) applied as a credit against the outstanding
principal balance of the Obligations or accrued and unpaid interest (not to
exceed the maximum amount permitted by law), (2) refunded to the payor thereof,
or (3) any combination of the foregoing; (iv) the interest rate(s) provided for
herein shall be automatically reduced to the maximum lawful rate allowed under
applicable law, and this Agreement shall be deemed to have been, and shall be,
reformed and modified to reflect such reduction; and (v) neither the Company nor
any endorser shall have any action against the Bank for any damages, penalties
or relief under any usury statute to set aside the Obligations or to make the
Obligations or any portion thereof uncollectible arising out of the payment or
collection of any Excess Interest.
(8) Late Payments. If the principal amount of any Obligation is not paid when
due, such Obligation shall bear interest until paid in full at a rate per annum
equal to the Prime Rate from time to time in effect plus two percent (2%),
payable on demand, for the period from and including the date on which payment
is due or declared due, but not including the date on which the payment is made.
Interest shall be computed on the basis of a year consisting of 360 days for the
actual number of days elapsed.
SECTION 4. REDUCTION.
Reduction of the Stated Amount. The Letter of Credit shall be
permanently reduced on a quarterly basis in an amount equal to DM 218,750, if
within ten (10) days after the end of each calendar quarter, ABN AMRO shall not
have made a drawing thereunder.
SECTION 5. CONDITIONS PRECEDENT TO ISSUANCE OF THE LETTER OF CREDIT. The
obligation of the Bank to cause the L/C Bank to issue the Letter of Credit shall
be subject to the satisfaction of the following conditions precedent:
(1) The following statements shall be true and correct on the Date of Issuance
and the Bank shall have received a certificate of the Company signed on its
behalf by an Authorized Officer, dated the Date of Issuance, stating that:
(i) the representations and warranties contained in the Loan
Documents and this Agreement are correct on and as of the Date
of Issuance as though made on and as of such date; and
(ii) no Event of Default has occurred and is continuing, or
would result from the issuance of the Letter of Credit, and no
event has occurred and is continuing which would constitute
any such Event of Default but for the requirement that notice
be given or time elapse or both;
(b) The Bank shall have received on or before the Date of
Issuance the following, each dated the Date of Issuance or the date
hereof, as the Bank may require, in form and substance satisfactory to
the Bank and its counsel:
(i) incumbency certificate with respect to the Authorized
Officers of the Company executing the documents referred to in
item (i) above;
(ii) evidence of the due authorization, execution and delivery
by the parties thereto of the Loan Documents to which the
Company or any Subsidiary is a party, including without
limitation fully executed copies (or a certified duplicate
thereof) of each of the ABN Loan Documents;
(iii) a guaranty by CFC International, Inc. of the obligations
of the Company hereunder;
(iv) the pledge by the Company of the shares of CFC Oeserwerk
GMBH and CFC Oeser France SARL ("Pledge") as collateral for
the Obligations;
(v) copies of the organizational documents of the Company;
(vi) an opinion of counsel to the Company;
(vii) a fully executed copy of this Agreement; and
(viii) such other certificates, documents, instruments,
approvals (and, if requested by the Bank, certified duplicates
of executed copies thereof) or opinions as the Bank may
reasonably request.
SECTION 6. OBLIGATIONS ABSOLUTE. The Obligations of the Company under this
Agreement shall be absolute, unconditional and irrevocable, and shall be paid
and performed strictly in accordance with the respective terms thereof, under
all circumstances whatsoever, including, without limitation, the following
circumstances:
(1) any lack of validity or enforceability of the Letter of Credit;
(2) any amendment or waiver of or any consent to departure from all or any
of the other Loan Documents;
(3) the existence of any claim, set-off, defense or other rights which the
Company may have at any time against any beneficiary or any transferee of the
Letter of Credit (or any persons or entities for whom any such beneficiary or
any such transferee may be acting), the Bank or the L/C Bank (other than the
defense of payment to the Bank in accordance with the terms of this Agreement)
or any other person or entity, whether in connection with this Agreement, the
Letter of Credit, the Loan Documents or any unrelated transaction;
(4) any statement or any other document presented under the Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect whatsoever; provided
that the acceptance of any such statement or document by the Bank or the L/C
Bank shall not be the result of gross negligence or willful misconduct by the
Bank or the L/C Bank;
(5) payment by the L/C Bank under the Letter of Credit against presentation of a
sight draft or certificate which does not comply with the terms of the Letter of
Credit, provided that such payment shall not have constituted gross negligence
or willful misconduct of the L/C Bank;
(6) payment by the L/C Bank under the Letter of Credit notwithstanding:
(i) any instructions of the Company given after the Letter
of Credit is issued not to make payment thereunder;
(ii) the occurrence of any event, including, without
limitation, the commencement of legal proceedings to prohibit
payment under the Letter of Credit; or
(iii) the issuance of any order by any government agency,
governing body or court whether or not having jurisdiction in
the premises prohibiting payment under the Letter of Credit
provided that such payment shall not have constituted gross
negligence or willful misconduct on the part of the L/C Bank;
and
(7) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing, provided that such other circumstance or happening shall
not have been the result of gross negligence or willful misconduct of the Bank
or the L/C Bank.
SECTION 7. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Bank as follows:
(1) Incorporation By Reference. The representations and warranties of the
Company as set forth in the ABN Loan Documents are hereby incorporated in this
Agreement by this reference as if they were fully set forth herein, and such
representations and warranties shall continue in effect as long as this
Agreement remains in effect regardless of whether the ABN Loan Documents shall
be earlier terminated. If any provision contained in this Agreement is in
conflict with, or inconsistent with, any provisions in the ABN Loan Documents,
the provision contained in this Agreement shall govern and control with respect
to the contractual relationship between the Company and the Bank under this
Agreement.
(2) Reaffirmation and Readoption. Each and every representation and warranty
contained in the ABN Loan Documents or thereafter made by the Company is hereby
reaffirmed and readopted as being true and correct in all respects on and as of
the date hereof.
(3) Power and Authority, No Contravention. The execution, delivery and
performance by the Company of this Agreement has been duly authorized by all
necessary corporate action, and (i) does not contravene any law or contractual
restriction binding on or affecting the Company, and (ii) does not contravene
any charter, or other organizational document of the Company.
(4) No Consent, etc. No consent, authorization, order, registration,
qualification or approval or other action by, and no notice to or filing with,
any Person is required for the due execution, delivery and performance by the
Company of this Agreement, other than those already obtained.
(5) Legal, Valid and Binding. This Agreement has been duly executed and
delivered by the Company, is the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(6) Litigation. There is no outstanding judgment, order or award, or pending
action or proceeding before any court, governmental agency or arbitrator against
or directly involving, the Company and, to the best of the Company's knowledge,
there is no threatened action or proceeding affecting the Company before any
court, governmental agency or arbitrator which, in any case, may materially and
adversely affect the financial condition, business, properties or operations of
the Company.
(7) Compliance with Other Instruments, Material Restrictions. The Company is not
in default in the performance, observance or fulfillment of any of the material
obligations, covenants or conditions contained in any agreement, instrument or
document evidencing or pursuant to which indebtedness has been issued by it or
in any other agreement to which it is a party. The Company is not a party to any
agreement or other instrument or subject to any other restriction which
materially adversely affects its business, property, assets, operations or
condition, financial or otherwise.
(8) No Defaults. No Event of Default or no event has occurred and is continuing
which would constitute any such Event of Default but for the requirement that
notice be given or time elapse or both.
SECTION 8. AFFIRMATIVE COVENANTS OF THE COMPANY. So long as the Expiration Date
has not occurred or any Obligation has not been completely performed or
otherwise satisfied, unless the Bank shall otherwise consent in writing, the
Company agrees:
(1) Incorporation by Reference. The affirmative covenants of the Company as set
forth in the ABN Loan Documents, as amended from time to time, are hereby
incorporated in this Agreement by this reference as if they were fully set forth
herein, and such covenants shall continue in effect and the Company agrees to
keep and perform same as long as this Agreement remains in effect regardless of
whether the ABN Loan Documents shall be earlier terminated. If any provision
contained in this Agreement is in conflict with, or inconsistent with, any
provisions in the ABN Loan Documents, the provision contained in this Agreement
shall govern and control with respect to the contractual relationship among the
Company and the Bank under this Agreement.
(2) Payment and Performance. The Company will pay and perform each of the
Company's covenants and obligations under this Agreement, the Letter of Credit,
and the Loan Documents in accordance with the terms and conditions set forth
herein and therein.
(3) Reports and Notices of Certain Events. The Company will furnish to the Bank,
promptly, and in no event more than five (5) Business Days after learning of the
occurrence of any of the following, written notice thereof, describing the same
and the steps, if any, being taken by the Company with respect thereto: (i) the
occurrence of an Event of Default or (ii) the institution of, or any adverse
determination in, any litigation, arbitration or governmental proceeding that is
material to the transactions contemplated by this Agreement.
(4) Annual Profitability. The Company and its Subsidiaries shall each have an
after-tax Net Income of not less than $1 as of the end of each of its fiscal
years. For purposes hereof, "Net Income" shall mean the net income of each of
the Company and its Subsidiaries as calculated in accordance with Generally
Accepted Accounting Principles consistently applied.
(5) Financial Reporting. The Company shall cause to be furnished to the Bank:
(i) Beginning with the month ending May 31, 1999, as soon as
practicable, and in any event within thirty (30) after the end
of each month, the Company's and its Subsidiaries'
consolidated and consolidating statements of income and
retained earnings and statements of cash flow for the month
then ended and consolidated and consolidating balance sheets
of the Company and its Subsidiaries as of the end of such
month, all in reasonable detail, and certified by an
Authorized Officer of Company as being accurate in all
material respects and on a basis consistent with that applied
in the preparation of Company's previous monthly financial
statements; and
(ii) As soon as practicable and, in any event, within ninety
(90) days after the end of each fiscal year of the Company,
beginning with the fiscal year ended December 31, 1999, the
Company's consolidated and consolidating audited statements of
income and retained earnings and statements of cash flow for
the fiscal year then ended and consolidated and consolidating
balance sheets of the Company and its Subsidiaries as of the
end of such fiscal year, all in reasonable detail, certified
by an independent certified public accountant selected by the
Company, and reasonably acceptable to the Bank and prepared in
accordance with Generally Accepted Accounting Principles
consistently applied.
(6) Records, Books and Inspections. The Company will maintain complete and
accurate records and books of account; permit reasonable access by the Bank to,
and permit the Bank to make copies of and to take abstracts from, such books and
records of the Company. The Bank shall treat all such information as
confidential and shall disclose it only to the L/C Bank, Bank's regulators,
employees, agents, assignees, participants, under court order or in connection
with any administrative or judicial proceeding.
(7) Other Agreements. The Company will not enter into any agreement containing
any provision that would be violated or breached in any material respect by the
performance of the Company's obligations under this Agreement, the Letter of
Credit or any of the Loan Documents or under any other instrument or document
delivered or to be delivered by the Company thereunder or in connection
therewith.
(8) Borrowing Base. The Company shall cause its Subsidiary, CFC Oeserwerk GMBH
("Oeserwerk") to provide to the Bank on a monthly basis, within ten (10)
Business Days after the end of each month, a Borrowing Base Certificate (the
"Borrowing Base Certificate") in the form of Attachment B, calculating the
Eligible Accounts and Eligible Inventory of Oeserwerk. If at any time, the
outstanding principal balance of the Line of Credit exceeds the Borrowing Base,
the Company shall or shall cause Oeserwerk to make a payment to ABN AMRO in the
amount of such deficiency.
For purposes of this section,
"Account" means all contract rights, any and all manner of
accounts receivable, contract rights, and all security agreements, guaranties,
letters of credit and any other collateral security for any or all of the
foregoing wheresoever located and whether now or hereafter owned, acquired,
arising or existing.
"Account Debtor" means the Person obligated on any Account.
"Borrowing Base" shall mean: (a) 80% of the face amount of the
Eligible Accounts of Oeserwerk plus (b) 50% of the lower of cost or market value
of the Eligible Inventory of Oeserwerk.
"Eligible Accounts" means such Accounts arising in the
ordinary course of Oeserwerk's business which are not subject to any lien or
encumbrance and which are evidenced by an invoice. In addition, no Account shall
be an Eligible Account, if:
(i) it arises out of a sale made by Oeserwerk to an
Affiliate of Oeserwerk or to a Person controlled by
an Affiliate of Oeserwerk; or
(ii) it is due or unpaid more than ninety (90) days
after the original invoice date; or
(iii) twenty-five percent (25%) or more at any one
time of the Accounts from a particular Account Debtor are
not deemed Eligible Accounts hereunder; or
(iv) the Account Debtor has commenced a voluntary
case under any bankruptcy or insolvency law, as now
constituted or hereafter amended, or a decree or order for
relief has been entered by a court having jurisdiction in
the premises in respect of the Account Debtor in an
involuntary case under the bankruptcy or insolvency laws,
as now constituted or hereafter amended, or any other
petition or other application for relief under the
bankruptcy or insolvency laws has been filed against the
Account Debtor, or if the Account Debtor has failed,
suspended business, ceased to be solvent; or
(v) the goods giving rise to such Account have not
been shipped and delivered to the Account Debtor or the
Account otherwise does not represent a final sale; or
(vi) the Account is subject to any offset, deduction,
defense, dispute, or counterclaim, or if the Account is
contingent in any respect or for any reason; or
(vii) Oeserwerk has made any agreement with any
Account Debtor for any deduction therefrom, except for
discounts or allowances made in the ordinary course of
business for prompt payment, all of which discounts or
allowances are reflected in the calculation of the face
value of each respective invoice related thereto;
"Eligible Inventory" shall mean that portion of Oeserwerk's
inventory consisting of new raw materials and finished goods which is not
subject to any lien or encumbrance, is in good and saleable condition and is not
obsolete, damaged or defective, but shall not include work-in-process, supplies
or packaging material.
SECTION 9. NEGATIVE COVENANTS OF THE COMPANY. So long as the Expiration Date has
not occurred or any Obligation has not been completely performed or otherwise
satisfied, unless the Bank shall otherwise consent in writing, the Company
agrees:
(1) Incorporation By Reference. The negative covenants of the Company as set
forth in the ABN Loan Documents, as amended from time to time, are hereby
incorporated in this Agreement by this reference as if they were fully set forth
herein, and such covenants shall continue in effect and the Company agrees to
keep and perform same as long as this Agreement remains in effect regardless of
whether the ABN Loan Documents shall be earlier terminated. If any provision
contained in this Agreement is in conflict with, or inconsistent with, any
provisions in the Loan Documents, the provision contained in this Agreement
shall govern and control with respect to the contractual relationship between
the Company and the Bank under this Agreement.
(2) Liens. The Company shall not and shall not permit Oeserwerk to create,
incur, grant, pledge, permit or suffer to exist, any security interest, lien,
pledge, mortgage, charge, or encumbrance upon any of its real or personal
property assets, except as provided in the Pledge.
(3) Other Agreements. The Company will not enter into any agreement containing
any provision that would be violated or breached in any material manner by the
performance of the Company's obligations under this Agreement or any other
instrument or document delivered or to be delivered by the Company hereunder or
in connection herewith.
SECTION 10. EVENTS OF DEFAULT. Upon the occurrence of any one or more of
the following events (herein referred to as an "Event of Default"), unless
waived by the Bank pursuant to Section 12 hereof:
(1) Incorporation By Reference. Each "Event of Default" as set forth in the ABN
Loan Documents, as amended from time to time, are hereby incorporated in this
Agreement by this reference as if it were fully set forth herein, regardless of
whether the ABN Loan Documents shall be earlier terminated. If any provision
contained in this Agreement is in conflict with, or inconsistent with, any
provisions in the ABN Loan Documents, the provision contained in this Agreement
shall govern and control with respect to the contractual relationship between
the Bank and the Company under this Agreement; or
(2) Untrue Representation. Any representation or warranty made by the Company
herein, in the other Loan Documents in any certificate, financial or other
statement furnished to the Bank by the Company pursuant to this Agreement or any
other Loan Document shall prove to have been untrue or incomplete in any
material respect when made; or
(3) Failure to Pay. The Company shall fail to pay when due any Obligation; or
(4) Failure to Perform. The Company shall fail to perform or observe any term,
covenant or agreement contained in this Agreement, and any such failure shall
remain unremedied for ten (10) days after written notice thereof shall have been
given to the Company by the Bank; or
(5) Insolvency. The Company becomes insolvent or over-indebted, or a request for
opening of court insolvency proceedings is filed, or the Company commences
out-of-court reorganization or composition negotiations with creditors; or
(6) Dissolution. The Company shall be dissolved or its existence shall otherwise
be terminated.
(7) Other Agreements. A default shall occur and be continuing under any
agreement between the Company and the Bank or under any obligation owed by the
Company to the Bank, subject to any applicable grace or cure period;
(8) Other Indebtedness. A default shall occur in the payment when due (subject
to any applicable grace or cure period), whether by acceleration, redemption, or
otherwise, of any material indebtedness (other than indebtedness under this
Agreement) for borrowed money of the Company, the effect of which causes the
Person to whom such indebted ness is owed to cause such indebtedness to become
due prior to its stated maturity or otherwise accelerated; or
(9) Judgment. A judgment or order shall be rendered against the Company for the
payment of money in excess of DM 435,000, and such judgment or order shall
continue unsatisfied or unstayed for a period of 60 consecutive days.
(10) Lack of Validity. Any provision of this Agreement shall at any time for any
reason cease to be valid and binding on the Company, or shall be declared to be
null and void, or the validity or enforceability thereof shall be contested by
the Company or any other party (excluding the Bank) or any governmental agency
or authority or the Company or any other party shall deny that it has any or
further liability or obligation under this Agreement; or
(11) Borrowing Base Deficiency. The Company or CFC Oeserwerk shall fail to pay
to ABN AMRO the amount of any borrowing base deficiency as provided in Section
8(h) hereof.
SECTION 11. DEFAULT, RIGHTS AND REMEDIES OF THE BANK.
Upon the occurrence of an Event of Default, the Bank may exercise any
one or more of the following rights and remedies contained in this Agreement,
all of the rights and remedies under applicable laws, all of which rights and
remedies shall be cumulative and non-exclusive, to the extent permitted by law:
(1) by written notice to the Company, require that the Company immediately
prepay to the Bank in immediately available funds an amount equal to the
Available Amount (such amounts to be held by the Bank as collateral security for
the Obligations), provided however, that in the case of any Event of Default
described in Section 10(e), such prepayment Obligations shall automatically
become immediately due and payable without any notice;
(2) by written notice to the Company, declare all Obligations to be, and such
amounts shall thereupon become, immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Company, provided that upon the occurrence of an Event of Default under
Section 10(e) hereof such acceleration shall automatically occur; or
(3) pursue any other action available at law or in equity.
(4) DEMAND, PRESENTMENT, PROTEST AND NOTICE OF DEMAND, PRESENTMENT, PROTEST AND
NONPAYMENT ARE HEREBY WAIVED BY THE COMPANY EXCEPT FOR NOTICE OF ACCELERATION IN
ACCORDANCE WITH SUBSECTION 11(a) HEREOF. THE COMPANY ALSO WAIVES THE BENEFIT OF
ALL VALUATION, APPRAISAL AND EXEMPTION LAWS.
SECTION 12. AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of
this Agreement, or consent to any departure by the Company therefrom shall in
any event be effective unless the same shall be in writing and signed by the
Bank, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
SECTION 13. NOTICES. Except as otherwise expressly provided herein, any notice
required or desired to be served, given or delivered hereunder shall be in
writing, and shall be deemed to have been validly served, given or delivered
three (3) days after deposit in the United States mails, with proper postage
prepaid, or upon delivery by courier or upon transmission by telex, telecopy or
similar electronic medium to the following addresses:
(i) If to the Bank, at:
LaSalle Bank National Association
0000 Xxxx Xxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx Xxxxxxxx
Facsimile (000) 000-0000
with a copy to:
Jenner & Block
Xxx XXX Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
(ii) If to the Company, at:
CFC Europe GmbH
Xxxxxxxxxxx 00
00000 Xxxxxxxxxx-Xxxxxxxx
Xxxxxxx
Attn: Xxxxxxx Xxxxx
Facsimile: 011-49-71-61-800-94-60
with a copy to:
CFC International, Inc.
000 Xxxxx Xxxxxx
Xxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx Xxxxx
or to such other address as each party designates to the other in the manner
herein prescribed.
SECTION 14. NO WAIVER; REMEDIES. No failure on the part of the Bank to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other further exercise thereof or the exercise of any other right.
The remedies herein provided are cumulative and not exclusive of any remedies
provided in any other Loan Document or now or hereafter existing at law or in
equity.
SECTION 15. INDEMNIFICATION. The Company hereby indemnifies and holds harmless
the Bank from and against any and all claims, damages, losses, liabilities,
reasonable costs or expenses whatsoever which the Bank may incur (or which may
be claimed against the Bank by any person or entity whatsoever) by reason of or
in connection with the execution and delivery or transfer of, or payment or
failure to pay under, the Letter of Credit; provided that the Company shall not
be required to indemnify the Bank for any claims, damages, losses, liabilities,
costs or expenses to the extent, but only to the extent, caused by (a) the
willful misconduct or gross negligence of the Bank or L/C Bank in determining
whether a sight draft or certificate presented under the Letter of Credit
complied with the terms of the Letter of Credit or (b) the Bank's or L/C Bank's
willful failure to pay under the Letter of Credit after the presentation to it
by ABN AMRO of a sight draft and certificate strictly complying with the terms
and conditions of the Letter of Credit. Nothing in this Section 15 is intended
to limit the reimbursement obligation of the Company contained in paragraph (a)
of Section 3 hereof. In case any action or proceeding is brought against the
Bank in respect of which indemnity may be sought under this Agreement the party
seeking indemnification shall give notice of any such action or proceeding to
the Company and may require the Company, upon such notice, to assume the defense
of the action or proceeding; provided that failure of such party to give such
notice shall not relieve the Company from any of its obligations under this
Section 15. Upon receipt of notice from any party seeking indemnification the
Company shall resist and defend such action or proceeding at the Company's
expense. The obligations of the Company under this Section 15 shall survive the
payment of the Obligations owed under this Agreement and the termination of this
Agreement. SECTION 1.
SECTION 16. CONTINUING OBLIGATION. This Agreement is a continuing obligation and
shall (i) be binding upon the Company, its successors and assigns, and (ii)
inure to the benefit of and be enforceable by the Bank and its successors,
transferees and assigns; provided that the Company may not assign all or any
part of this Agreement without the prior written consent of the Bank. The Bank
may assign, negotiate, pledge or otherwise hypothecate all or any portion of
this Agreement, or grant participations herein, in the Letter of Credit or in
any of its rights or security hereunder, including, without limitation, the
instruments securing the Company's obligations hereunder. No such assignment or
participation by the Bank, however, will relieve the L/C Bank of its obligation
under the Letter of Credit. In connection with any assignment or participation,
the Bank may disclose to the proposed assignee or participant any information
that the Company is required to deliver to the Bank pursuant to this Agreement;
provided, however, that if any such information is confidential, such third
party shall first enter into a confidentiality agreement with the Company.
SECTION 17. LIMITED LIABILITY OF THE BANK. The Company assumes all risks of the
acts or omissions of ABN AMRO with respect to its use of the Letter of Credit.
Neither the Bank nor any of its officers or directors shall be liable or
responsible for: (a) the use which may be made of the Letter of Credit or for
any acts or omissions of ABN AMRO and any transferee in connection therewith;
(b) the validity, sufficiency or genuineness of documents, or of any
endorsement(s) or signature(s) thereon, even if such documents should in fact
prove to be in any or all respects invalid, insufficient, fraudulent or forged;
(c) payment by the Bank or the L/C Bank against presentation of documents which
do not comply with the terms of the Letter of Credit, including failure of any
documents to bear any reference or adequate reference to the Letter of Credit;
or (d) any other circumstances whatsoever in making or failing to make payment
under the Letter of Credit, except only that the Company shall have a claim
against the Bank, and the Bank shall be liable to the Company, to the extent,
but only to the extent, of any direct, as opposed to consequential, damages
suffered by the Company which the Company proves were caused by (i) the L/C
Bank's willful misconduct or gross negligence in determining whether documents
presented under the Letter of Credit comply with the terms of the Letter of
Credit, or (ii) the L/C Bank's willful failure to pay under the Letter of Credit
after the presentation to it by ABN AMRO of a sight draft and certificate
strictly complying with the terms and conditions of the Letter of Credit.
SECTION 18. COSTS, EXPENSES AND TAXES. The Company agrees to pay on demand all
reasonable costs and expenses in connection with the preparation, execution,
delivery and administration of this Agreement and any other documents which may
be delivered in connection with this Agreement, including, without limitation,
the reasonable fees and out-of-pocket expenses of special counsel and local
counsel for the Bank with respect thereto and with respect to advising the Bank
as of its rights and responsibilities under this Agreement and all reasonable
costs and expenses, if any, in connection with (i) the change in terms,
maintenance, renewal or cancellation of the Letter of Credit, (ii) any and all
reasonable amounts which the Bank has paid relative to the Bank's curing of any
Event of Default resulting from the acts or omissions of the Company under this
Agreement or any Loan Document, (iii) the enforcement of this Agreement or any
Loan Documents, or (iv) any action or proceeding relating to a court order,
injunction or other process or decree restraining or seeking to restrain the
Bank from paying any amount under the Letter of Credit. In addition, the Company
shall pay any and all stamp and other similar taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing and
recording of the Letter of Credit, this Agreement, any other Loan Document or
any other document which may be delivered in connection with this Agreement, and
agrees to save the Bank harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omission to pay such taxes
and fees.
SECTION 19. SEVERABILITY. Any provision of this Agreement which is prohibited,
unenforceable or not authorized in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition, unenforceability
or non-authorization without invalidating the remaining provisions hereof or
affecting the validity, enforceability or legality of such provision in any
other jurisdiction.
SECTION 20. SATISFACTION REQUIREMENT. If any agreement, certificate or other
writing, or any action taken or to be taken, is by the terms of this Agreement
required to be satisfactory to the Bank, the determination of such satisfaction
shall be made by the Bank, in its sole and exclusive judgment exercised in good
faith.
SECTION 21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF. THE COMPANY AGREES
AND CONSENTS TO THE EXERCISE OF JURISDICTION OVER IT BY ANY STATE OR FEDERAL
COURT IN THE STATE OF ILLINOIS AND THAT ANY ACTION OR PROCEEDING BROUGHT BY THE
COMPANY UNDER THIS AGREEMENT OR AGAINST THE BANK SHALL BE BROUGHT IN SUCH
COURTS.
SECTION 22. WAIVER OF TRIAL BY JURY. EACH OF THE COMPANY AND THE BANK HEREBY
AGREES THAT, IN ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, IRREVOCABLY
WAIVES ANY AND ALL RIGHTS TO TRIAL THEREOF BY JURY.
SECTION 23. CURRENCY OF ACCOUNT AND PAYMENT. Payment for each and every
obligation due from the Company hereunder shall be made in lawful currency of
the United States. If any sum due from the Company under this Agreement, or any
order or judgment given or made in relation hereto has to be converted from the
currency (the "First Currency") in which the same is payable hereunder, or under
such order or judgment into another currency (the "Second Currency") for the
purpose of (i) making or filing a claim or proof against the Company, (ii)
obtaining an order or judgment in any court or other tribunal, or (iii)
enforcing any order or judgment given or made in relation hereto, the Company
shall indemnify and hold harmless each of the Persons to whom such sum is due
from and against any loss suffered as a result of any discrepancy between (a)
the rate of exchange used for such purpose to convert the sum in question from
the First Currency into the Second Currency and (b) the rate or rates of
exchange at which such Person may in the ordinary course of business purchase
the First Currency with the Second Currency upon receipt of a sum paid to it in
satisfaction, in whole or in part, of any such order, judgment, claim or proof.
SECTION 24. ENGLISH LANGUAGE This Agreement shall be made in the
English language and each communication and document made or delivered by one
party to another pursuant to this Agreement shall be in the English language or
accompanied by a translation thereof into English certified (by an officer of
the Person making or delivering the same), as being a true and accurate
translation thereof.
SECTION 25. FORUM AND JURISDICTION. The Company irrevocably waives any
objection which it might now or hereafter have to the court referred to in
paragraph 21 above being nominated as the forum to hear and determine any suit,
action or proceeding, and to settle any disputes which may arise out of or in
connection with this Agreement and agrees not to claim that any such court is
not a convenience or appropriate forum. The Company agrees the process by which
any suit, action or proceeding is begun may be served on it by being delivered
to CFC International, Inc. at its principal place of business at c/o CFC
International, Inc., 000 Xxxxx Xxxxxx, Xxxxxxx Xxxxxxx, Xxxxxxxx 00000. Nothing
contained herein shall affect the right of the Bank to serve process in any
other manner permitted by law nor shall limit the Bank's right to take
proceedings against the Company in any other court of competent jurisdiction,
nor shall the taking of proceedings in any one or more jurisdictions preclude
the taking of proceedings in any other jurisdiction (whether concurrently or
not) if and to the extent permitted by applicable law.
SECTION 26. WITHHOLDING. All payments made by the Company hereunder
shall be made free and clear of, and without deduction, for any present or
future taxes, withholdings or charges other than income taxes of the United
States and any political subdivision thereof on the interest income received by
the Bank (all such non-excluded taxes, withholdings or charges are hereinafter
referred to as "Taxes"). If the Company shall be required by law to deduct any
Taxes from any sum payable hereunder, (i) the sum payable shall be increased so
that after making all required deductions, the Bank receives the amount
originally payable, and (ii) the Company shall pay the amount of such deductions
to the relevant taxing authority in accordance with applicable law and provide
Bank with an original or certified copy of a receipt evidencing payment thereof.
SECTION 27. COUNTERPARTS. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original, and it
shall not be necessary in making proof of this Agreement to produce or account
for more than one such counterpart.
SECTION 28. HEADINGS. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their duly authorized officers as of the day and year first above
written.
CFC EUROPE GMBH
By: ____________________________________
Title: ____________________________________
LASALLE BANK NATIONAL ASSOCIATION
By: ____________________________________
Title: ____________________________________
