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CREDIT AGREEMENT
Dated as of December 28, 2001
among
THE MARCUS CORPORATION,
BANK ONE, NA,
as Administrative Agent,
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
and
BANC ONE CAPITAL MARKETS, INC.,
as Lead Arranger and Sole Book Runner
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS..........................................................1
1.1 Certain Defined Terms........................................2
1.2 Other Interpretive Provisions...............................12
1.3 Accounting Principles.......................................13
ARTICLE II THE CREDITS........................................................13
2.1 Amounts and Terms of Commitments............................13
2.2 Loan Accounts...............................................14
2.3 Procedure for Borrowing.....................................14
2.4 Conversion and Continuation Elections.......................15
2.5 Changes in Aggregate Commitments............................16
2.6 Optional Prepayments........................................17
2.7 Repayment...................................................17
2.8 Interest....................................................17
2.9 Fees........................................................18
2.10 Computation of Fees and Interest............................18
2.11 Payments by the Company.....................................18
2.12 Payments by the Banks to the Agent..........................19
2.13 Sharing of Payments, Etc....................................19
2.14 Extension of Termination Date...............................20
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY............................20
3.1 Taxes.......................................................20
3.2 Illegality..................................................21
3.3 Increased Costs and Reduction of Return.....................22
3.4 Funding Losses..............................................22
3.5 Inability to Determine Rates................................23
3.6 Certificates of Banks.......................................23
3.7 Substitution of Banks.......................................24
3.8 Survival....................................................24
ARTICLE IV CONDITIONS PRECEDENT...............................................24
4.1 Conditions of Initial Loans.................................24
4.2 Conditions to All Borrowings................................25
ARTICLE V REPRESENTATIONS AND WARRANTIES......................................25
5.1 Corporate Existence and Power...............................25
5.2 Corporate Authorization; No Contravention...................26
5.3 Governmental Authorization..................................26
5.4 Binding Effect..............................................26
5.5 Litigation..................................................26
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5.6 No Default..................................................27
5.7 ERISA Compliance............................................27
5.8 Use of Proceeds; Margin Regulations.........................27
5.9 Title to Properties.........................................28
5.10 Taxes.......................................................28
5.11 Financial Condition.........................................28
5.12 Environmental Matters.......................................28
5.13 Regulated Entities..........................................28
5.14 No Burdensome Restrictions..................................29
5.15 Copyrights, Patents, Trademarks and Licenses, etc...........29
5.16 Subsidiaries................................................29
5.17 Insurance...................................................29
5.18 Full Disclosure.............................................29
5.19 Subsidiary Indebtedness.....................................30
ARTICLE VI AFFIRMATIVE COVENANTS..............................................30
6.1 Financial Statements........................................30
6.2 Certificates; Other Information.............................30
6.3 Notices.....................................................31
6.4 Preservation of Corporate Existence, Etc....................32
6.5 Maintenance of Property....................................32
6.6 Insurance...................................................32
6.7 Payment of Obligations......................................32
6.8 Compliance with Laws........................................33
6.9 Employee Benefit Plans......................................33
6.10 Accounting; Inspection of Property and Books and Records....33
6.11 Environmental Laws..........................................33
6.12 Use of Proceeds.............................................33
6.13 Contingent Obligations......................................33
ARTICLE VII NEGATIVE COVENANTS................................................34
7.1 Limitation on Liens.........................................34
7.2 Disposition of Assets.......................................35
7.3 Merger; Purchase of Assets; Acquisitions; Etc...............35
7.4 Loans and Investments.......................................36
7.5 Limitation on Subsidiary Indebtedness.......................36
7.6 Transactions with Affiliates................................36
7.7 Use of Proceeds.............................................36
7.8 Restricted Payments.........................................36
7.9 Change in Business..........................................36
7.10 Accounting Changes..........................................37
7.11 Funded Debt Ratio...........................................37
7.12 Fixed Charge Coverage Ratio.................................37
7.13 Subsidiary Dividends........................................37
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ARTICLE VIII EVENTS OF DEFAULT................................................37
8.1 Event of Default............................................37
8.2 Remedies....................................................39
8.3 Rights Not Exclusive........................................40
ARTICLE IX THE AGENT..........................................................40
9.1 Appointment and Authorization...............................40
9.2 Delegation of Duties........................................40
9.3 Liability of Agent..........................................40
9.4 Reliance by Agent...........................................40
9.5 Notice of Default...........................................41
9.6 Credit Decision.............................................41
9.7 Indemnification.............................................42
9.8 Agent in Individual Capacity................................42
9.9 Successor Agent.............................................42
9.10 Withholding Tax.............................................43
ARTICLE X MISCELLANEOUS.......................................................44
10.1 Amendments and Waivers......................................44
10.2 Notices.....................................................45
10.3 No Waiver; Cumulative Remedies..............................45
10.4 Costs and Expenses. The Company shall:.....................46
10.5 Indemnity...................................................46
10.6 Payments Set Aside..........................................47
10.7 Successors and Assigns......................................47
10.8 Assignments, Participations, Etc............................47
10.9 Confidentiality.............................................48
10.10 Set-off.....................................................49
10.11 Automatic Debits of Fees....................................49
10.12 Notification of Addresses, Lending Offices, Etc.............50
10.13 Counterparts................................................50
10.14 Severability................................................50
10.15 No Third Parties Benefited..................................50
10.16 Governing Law and Jurisdiction..............................50
10.17 Waiver of Jury Trial........................................50
10.18 Entire Agreement............................................51
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EXHIBITS
EXHIBIT A NOTICE OF BORROWING......................................A-1
EXHIBIT B NOTICE OF CONVERSION/CONTINUATION........................B-1
EXHIBIT C THE MARCUS CORPORATION COMPLIANCE CERTIFICATE............C-1
EXHIBIT D FORM OF OPINION OF COMPANY'S COUNSEL.....................D-1
EXHIBIT E FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT..............E-1
EXHIBIT F FORM OF PROMISSORY NOTE..................................F-1
SCHEDULES
Schedule 1.1 Pricing Schedule
Schedule 2.1 Commitments and Pro Rata Shares
Schedule 5.16 Subsidiaries and Minority Interests
Schedule 7.1 Permitted Liens
Schedule 7.4 Investments
Schedule 10.2 Lending Offices; Addresses for Notices
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CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of December 28, 2001, among
THE MARCUS CORPORATION, a Wisconsin corporation (the "Company"), the several
financial institutions from time to time party to this Agreement (collectively,
the "Banks"; individually, a "Bank") and Bank One, NA, as administrative agent
for the Banks.
WHEREAS, the Company, the Agent and various financial institutions (the
"Existing Banks") are parties to a Credit Agreement dated as of December 29,
2000 (the "Existing Credit Agreement"), pursuant to which the Existing Banks
have made available to the company a revolving credit facility;
WHEREAS, the term of the Existing Credit Agreement expires on the date
hereof, and the Company, the Agent and the Banks have agreed to enter into this
Agreement in replacement of the Existing Credit Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms. The following terms have the following
meanings:
"Acquisition" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests or equity of any Person, or otherwise causing any
Person to become a Subsidiary, or (c) a merger or consolidation or any other
combination with another Person (other than a Person that is a Subsidiary)
provided that the Company or the Subsidiary is the surviving entity.
"Adjusted Consolidated Cash Flow" means, for any period, the
Consolidated Net Income of the Company and its Subsidiaries plus (a)
depreciation and amortization for such period, (b) all current and deferred
taxes on income, provision for taxes on income, provision for taxes on
unremitted foreign earnings which are included in consolidated gross revenues
and current additions to reserves, and (c) Interest and Rental Expense for the
Company and its Subsidiaries on a consolidated basis.
"Affiliate" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, by contract, or otherwise.
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"Agent" means Bank One in its capacity as administrative agent for the
Banks hereunder, and any successor administrative agent arising under Section
9.9.
"Agent-Related Persons" means Bank One and any successor administrative
agent arising under Section 9.9, together with their respective Affiliates
(including, in the case of Bank One, the Lead Arranger), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agent's Payment Office" means the address for payments set forth on
the signature page hereto in relation to the Agent, or such other address as the
Agent may from time to time specify.
"Agreement" means this Credit Agreement.
"Applicable Margin" means, at any time, with respect to Eurodollar Rate
Loans and Base Rate Loans, the rate per annum determined in accordance with
Schedule 1.1.
"Assignee" has the meaning specified in subsection 10.8(a).
"Attorney Costs" means and includes all fees and disbursements of any
law firm or other external counsel, the allocated cost of internal legal
services and all disbursements of internal counsel.
"Bank" has the meaning specified in the introductory clause hereto.
"Bank One" means Bank One, NA, a national banking association having
its principal office in Chicago, Illinois, in its individual capacity, and its
successors.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C.ss.101, et seq.).
"Base Rate" means, for any day, a rate of interest per annum equal to
the sum of (i) the higher of (a) the Corporate Base Rate for such day and (b)
the sum of the Federal Funds Effective Rate for such day plus 1/2% per annum,
plus (ii) the Applicable Margin.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Borrowing" means a borrowing hereunder consisting of Loans of the same
Type made to the Company on the same day by the Banks under Article II, and, in
the case of Eurodollar Rate Loans, having the same Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs under
Section 2.3.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in Chicago are authorized or required by law to close
and, if the
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applicable Business Day relates to any Eurodollar Rate Loan, means such a day on
which dealings are carried on in the London interbank market.
"Capital Adequacy Regulation" means any guideline, request or directive
of any central bank or other Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each case, regarding
capital adequacy of any bank or of any corporation controlling a bank.
"Capital Lease" means, as to any Person, any lease which, in accordance
with GAAP consistently applied, is or should be capitalized on the books of such
Person.
"Cash Equivalents" means, as to any Person, (a) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than three
months from the date of acquisition, (b) time deposits and certificates of
deposit of any commercial bank with a long-term unsecured debt rating of at
least A or its equivalent from Standard & Poor's Ratings Group or at least A-2
or its equivalent from Xxxxx'x Investors Service, Inc., with maturities of not
more than three months from the date of acquisition by such Person, (c)
repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clause (a) above entered into with any bank
meeting the qualifications specified in clause (b) above, (d) commercial paper
issued by any Person incorporated in the United States, which commercial paper
is rated at least A-l or the equivalent thereof by Standard & Poor's Corporation
or at least P-l or the equivalent thereof by Xxxxx'x Investors Service, Inc.,
and in each case maturing not more than three months after the date of
acquisition by such Person and (e) investments in money market funds,
substantially all the assets of which are comprised of securities of the types
described in clauses (a) through (d) above.
"Change of Control" means any event, or combination of events, the
result of which is that Xxxxxxx X. Xxxxxx and Xxxxx Xxxxxx Xxxxxxxxxx and their
respective heirs, together with the heirs of Xxx Xxxxxx, collectively, no longer
beneficially own (within the meaning of Rule 13d-3 of the SEC under the Exchange
Act) 51% or more of the voting rights with respect to outstanding shares of the
Company.
"Closing Date" means the date on which all conditions precedent set
forth in Section 4.1 are satisfied or waived by all Banks (or, in the case of
subsection 4.1(e), waived by the Person entitled to receive such payment).
"Code" means the Internal Revenue Code of 1986, as amended, and
regulations promulgated thereunder.
"Commitment", as to each Bank, has the meaning specified in Section
2.1. As of the date of this Agreement, the amount of the combined Commitments of
all Banks is $40,000,000.
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"Compliance Certificate" means a certificate substantially in the form
of Exhibit C.
"Consolidated Net Income" means, for any period, the consolidated gross
revenues of the Company and its Subsidiaries, less all operating and
nonoperating expenses of the Company and its Subsidiaries, including all charges
of a proper character (including current and deferred taxes on income, provision
for taxes on income, provisions for taxes on unremitted foreign earnings which
are included in consolidated gross revenues, and current additions to reserves),
all determined in accordance with GAAP consistently applied, but not including
in the computation thereof the amounts (including related expenses and any tax
effect related thereto) resulting from (i) any gains or losses resulting from
the sale, conversion or other disposition of capital assets (i.e., assets other
than current assets), (ii) any gains or losses resulting from the reevaluation
of assets, (iii) any gains or losses resulting from an acquisition by the
Company or any of its Subsidiaries at a discount of any debt of the Company or
any of its Subsidiaries, (iv) any equity of the Company or any of its
Subsidiaries in the unremitted earnings of any Person which is not a Subsidiary,
(v) any earnings of any Person acquired by the Company or any of its
Subsidiaries through purchase, merger or consolidation or otherwise for any time
prior to the date of acquisition, (vi) any deferred credit representing the
excess of equity in any Subsidiary of the Company at the date of acquisition
over the cost of the investment in such Subsidiary, (vii) any restoration to
income of any reserve, except to the extent that provision for such reserve was
made out of income accrued during such period, (viii) any net gain from the
collection of life insurance policies, or (ix) any gain resulting from any other
nonrecurring item.
"Contingent Obligation" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Obligation shall
(subject to any limitation set forth therein) be deemed to be the outstanding
principal amount (or maximum principal amount, if larger) of the debt,
obligation or other liability guaranteed thereby.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or agreement to
which such Person is a party or by which it or any of its property is bound.
"Controlled Group" means all members of a controlled group of
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Company, are treated as a single employer under Section 414 of the Code or
Section 4001 of ERISA.
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"Conversion/Continuation Date" means any date on which, under Section
2.4, the Company (a) converts Loans of one Type to another Type, or (b)
continues as Loans of the same Type, but with a new Interest Period, Loans
having Interest Periods expiring on such date.
"Corporate Base Rate" means a rate per annum equal to the corporate
base rate or prime rate of interest announced by Bank One or by its parent, BANK
ONE CORPORATION, from time to time, changing when and as said corporate base
rate or prime rate changes.
"Default" means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if not cured or otherwise remedied
during such time) constitute an Event of Default.
"Dollars", "dollars" and "$" each mean lawful money of the United
States.
"Eligible Assignee" means (i) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined, capital
and surplus of at least $100,000,000; (ii) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having a combined capital and surplus of at least $100,000,000,
provided that such bank is acting through a branch or agency located in the
United States; (iii) a Person that is primarily engaged in the business of
commercial banking and that is (A) a Subsidiary of a Bank, (B) a Subsidiary of a
Person of which a Bank is a Subsidiary, or (C) a Person of which a Bank is a
Subsidiary; and (iv) any other Person agreed to by the Company and the Agent.
"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or injury
to the environment.
"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
"Eurodollar Base Rate" means, with respect to a Eurodollar Rate Loan
for the relevant Interest Period, the applicable British Bankers' Association
Interest Settlement Rate for deposits in U.S. dollars appearing on Reuters
Screen FRBD as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, and having a maturity equal to such Interest
Period, provided that, (i) if Reuters Screen FRBD is not available to the Agent
for any reason, the applicable Eurodollar Base Rate for the relevant Interest
Period shall
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instead be the applicable British Bankers' Association Interest Settlement Rate
for deposits in U.S. dollars as reported by any other generally recognized
financial information service as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to
such Interest Period, and (ii) if no such British Bankers' Association Interest
Settlement Rate is available to the Agent, the applicable Eurodollar Base Rate
for the relevant Interest Period shall instead be the rate determined by the
Agent to be the rate at which Bank One or one of its Affiliate banks offers to
place deposits in U.S. dollars with first-class banks in the London interbank
market at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period, in the approximate amount of Bank One's
relevant Eurodollar Rate Loan and having a maturity equal to such Interest
Period.
"Eurodollar Rate" means, with respect to a Eurodollar Rate Loan for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest Period, divided by (b) one minus the Eurodollar
Reserve Percentage (expressed as a decimal) applicable to such Interest Period,
plus (ii) the Applicable Margin.
"Eurodollar Rate Loan" means a Loan which, except as otherwise provided
in Section 2.8(c), bears interest at the applicable Eurodollar Rate.
"Eurodollar Reserve Percentage" means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal, rounded upward to
the next 1/100th of 1%) in effect on such day (whether or not applicable to any
Bank) under regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities").
"Event of Default" means any of the events or circumstances specified
in Section 8.1.
"Exchange Act" means the Securities and Exchange Act of 1934, and
regulations promulgated thereunder.
"Facility Fee Rate" means, at any time, the rate per annum determined
in accordance with Schedule 1.1.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by Agent in its sole discretion.
"Fee Letter" has the meaning specified in subsection 2.9(a).
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"FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
"Funded Debt" means all Indebtedness for borrowed money (including
obligations under Capital Leases and excluding Contingent Obligations with
respect to Funded Indebtedness of other Persons).
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the Closing Date.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to Government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business on ordinary terms) (c)
all non-contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses; (e) all indebtedness
created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to property
acquired by the Person (even though the rights and remedies of the seller or
bank under such agreement in the event of default are limited to repossession or
sale of such property); (f) all obligations with respect to capital leases; (g)
all net obligations with respect to Swap Contracts; (h) all indebtedness
referred to in clauses (a) through (g) above secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien upon or in property (including accounts and contracts
rights) owned by such Person, even though such Person has not assumed or become
liable for the payment of such Indebtedness; and (i) all Contingent Obligations
in respect of indebtedness or obligations of others of the kinds referred to in
clauses (a) through (g) above.
"Indemnified Liabilities" has the meaning specified in Section 10.5.
"Indemnified Person" has the meaning specified in Section 10.5.
"Independent Auditor" has the meaning specified in subsection 6.1(a).
"Insolvency Proceeding" means (a) any case, action or proceeding before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency,
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liquidation, receivership, dissolution, winding-up or relief of debtors, or (b)
any general assignment for the benefit of creditors, composition, marshalling of
assets for creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; undertaken under U.S.
Federal, state or foreign law, including the Bankruptcy Code.
"Interest and Rental Expense" means, for any period, all amounts
recorded and deducted in computing the Company's Consolidated Net Income for
such period in respect of interest charges and expense and rental charges for
such period (whether paid or accrued, or a cash or non-cash expense, and in the
case of rental payments, including the full amount of those payments made under
operating leases or synthetic leases, but only the imputed interest under
Capital Leases).
"Interest Payment Date" means, as to any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Eurodollar Rate Loan and, as to
any Base Rate Loan, the last Business Day of each month and each date such Base
Rate Loan is converted into a Eurodollar Rate Loan, provided, however, that if
any Interest Period for a Eurodollar Rate Loan exceeds three months, the date
that falls three months after the beginning of such Interest Period and after
each Interest Payment Date thereafter is also an Interest Payment Date.
"Interest Period" means, the period commencing on the Borrowing Date of
a Eurodollar Rate Loan or on the Conversion/Continuation Date on which the Loan
is converted into or continued as a Eurodollar Rate Loan, and ending on the date
one, two, three or six months thereafter as selected by the Company in its
Notice of Borrowing or Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to the
following Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the preceding Business Day;
(ii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Termination
Date.
"Investment" means any advance, loan, extension of credit or capital
contribution to, or any investment in the capital stock or other equity
interest, or debt securities or other obligations of, another Person or any
contingent liability incurred for the benefit of another Person.
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"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Joint Venture" means a single-purpose corporation, partnership, joint
venture or other similar legal arrangement (whether created by contract or
conducted through a separate legal entity) now or hereafter formed by the
Company or any of its Subsidiaries with another Person in order to conduct a
common venture or enterprise with such Person.
"Lead Arranger" means Banc One Capital Markets, Inc.
"Lending Office" means, as to any Bank, the office or offices of such
Bank specified as its "Lending Office" or "Domestic Lending Office" or
"Eurodollar Lending Office", as the case may be, on Schedule 10.2, or such other
office or offices as such Bank may from time to time notify the Company and the
Agent.
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising under
or evidenced by any conditional sale or other title retention agreement, the
interest of a lessor under a capital lease, any financing lease having
substantially the same economic effect as any of the foregoing, or the filing of
any financing statement naming the owner of the asset to which such lien relates
as debtor, under the Uniform Commercial Code or any comparable law), but not
including the interest of a lessor under an operating lease.
"Loan" means an extension of credit by a Bank to the Company under
Article II, and may be a Base Rate Loan or a Eurodollar Rate Loan (each, a
"Type" of Loan).
"Loan Documents" means this Agreement, any Notes, the Fee Letter and
all other documents delivered to the Agent or any Bank in connection herewith.
"Majority Banks" means at any time Banks then holding in excess of 50%
of the then aggregate unpaid principal amount of the Loans, or, if no such
principal amount is then outstanding, Banks then having in excess of 50% of the
Commitments.
"Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, assets, liabilities
(actual or contingent), properties, condition (financial or otherwise) or
prospects of the Company or the Company and its Subsidiaries taken as a whole;
(b) a material impairment of the ability of the Company or any Subsidiary to
perform under any Loan Document and to avoid any Event of Default; or (c) a
material adverse effect upon the legality, validity, binding effect or
enforceability against the Company or any Subsidiary of any Loan Document.
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"Multiemployer Plan" means a "multiemployer plan", within the meaning
of Section 4001(a) (3) of ERISA, to which the Company or any member of the
Controlled Group makes, is making, or is obligated to make contributions or,
during the preceding three calendar years, has made, or been obligated to make,
contributions.
"Note" means a promissory note executed by the Company in favor of a
Bank pursuant to subsection 2.2(b), in substantially the form of Exhibit F.
"Notice of Borrowing" means a notice in substantially the form of
Exhibit A.
"Notice of Conversion/Continuation" means a notice in substantially the
form of Exhibit B.
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company to any
Bank, the Agent, or any Indemnified Person, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising.
"Organization Documents" means, for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or
instrument relating to the rights of preferred shareholders of such corporation,
any shareholder rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation.
"Other Taxes" means any present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Agreement or any other Loan Documents.
"Participant" has the meaning specified in subsection 10.8(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
Section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
Multiemployer Plan), and to which the Company or any member of the Controlled
Group may have any liability with respect to current or former employees of the
Company or any member of the Controlled Group, including any liability by reason
of having been a substantial employer within the meaning of Section 4063 of
ERISA at any time during the preceding five years, or by reason of being deemed
to be a contributing sponsor under Section 4069 of ERISA.
"Permitted Liens" has the meaning specified in Section 7.1.
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"Person" means an individual, partnership, limited liability company,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture or Governmental Authority.
"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Bank's Commitment divided by the combined Commitments of all Banks.
"Replacement Bank" has the meaning specified in Section 3.7.
"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
"Responsible Officer" means the chief executive officer or the
president of the Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with financial
covenants, the chief financial officer or the treasurer of the Company, or any
other officer having substantially the same authority and responsibility.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Senior Indebtedness" means all Indebtedness of the Company for money
borrowed which is not by its terms subordinated in right of payment to the
payment of any other Indebtedness of the Company.
"Subsidiary" of a Person means any corporation, association,
partnership, joint venture or other business entity of which more than 50% of
the voting stock or other equity interests (in the case of Persons other than
corporations), is owned or controlled directly or indirectly by the Person, or
one or more of the Subsidiaries of the Person, or a combination thereof. Unless
the context otherwise clearly requires, references herein to a "Subsidiary"
refer to a Subsidiary of the Company.
"Surety Instruments" means all letters of credit (including standby and
commercial), banker's acceptances, bank guaranties, shipside bonds, surety bonds
and similar instruments.
"Swap Contract" means any agreement (including any master agreement and
any agreement, whether or not in writing, relating to any single transaction)
that is an interest rate swap agreement, basis swap, forward rate agreement,
commodity swap, commodity option, equity or equity index swap or option, bond
option, interest rate option, forward foreign exchange agreement, rate cap,
collar or floor agreement, currency swap agreement, cross-currency rate swap
agreement, swaption, currency option or any other, similar agreement (including
any option to enter into any of the foregoing).
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"Taxes" means any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Bank and the Agent, such taxes (including income
taxes or franchise taxes) as are imposed on or measured by each Bank's net
income by the jurisdictions (or any political subdivision thereof) under the
laws of which such Bank or the Agent, as the case may be, is organized or
maintains a lending office.
"Termination Date" means the earlier to occur of:
(a) December 27, 2002 (subject to extension at the discretion
of the Banks as provided in Section 2.14); and
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
"Total Capitalization" means, as to any Person and as of any date, the
sum of the shareholders' equity of such Person, calculated in accordance with
GAAP consistently applied, as shown on a balance sheet of such Person, plus the
Funded Debt of such Person.
"Type" has the meaning specified in the definition of "Loan."
"United States" and "U.S." each means the United States of America.
"Welfare Plan" means a "welfare plan", as such term is defined in
Section 3(1) of ERISA.
"Wholly-Owned Subsidiary" means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of each
class having ordinary voting power, and 100% of the capital stock of every other
class, in each case, at the time as of which any determination is being made, is
owned, beneficially and of record, by the Company, or by one or more of the
other Wholly-Owned Subsidiaries, or both.
1.2 Other Interpretive Provisions. (a) The meanings of defined terms
are equally applicable to the singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
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(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding",
and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for convenience of
reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Banks or the Agent merely because of the
Agent's or Banks' involvement in their preparation.
1.3 Accounting Principles. Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied.
(a) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments. Each Bank severally agrees, on
the terms and conditions set forth herein, to make loans to the Company (each
such loan, a "Loan") from time to time on any Business Day during the period
from the Closing Date to the Termination Date, in an aggregate amount not to
exceed at any time outstanding, together with the principal amount of Loans
outstanding in favor of such Bank at such time, the amount set forth next to
such Bank's name on Schedule 2.1 (such amount, as the same may be reduced under
Section 2.5 or as a result of one or more assignments under Section 10.8, the
Bank's
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"Commitment"); provided, however, that, after giving effect to any Borrowing,
the aggregate principal amount of all outstanding Loans shall not at any time
exceed the combined Commitments. Within the limits of each Bank's Commitment,
and subject to the other terms and conditions hereof, the Company may borrow
under this Section 2.1, prepay under Section 2.6 and reborrow under this Section
2.1.
2.2 Loan Accounts. (a) The Loans made by each Bank shall be evidenced
by one or more loan accounts or records maintained by such Bank in the ordinary
course of business. The loan accounts or records maintained by the Agent and
each Bank shall be conclusive absent manifest error of the amount of the Loans
made by the Banks to the Company and the interest and payments thereon. Any
failure so to record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Company hereunder to pay any amount owing
with respect to the Loans.
(b) Upon the request of any Bank made through the Agent, the Loans made
by such Bank may be evidenced by one or more Notes, instead of loan accounts.
Each such Bank shall endorse on the schedules annexed to its Note(s) the date,
amount and maturity of each Loan made by it and the amount of each payment of
principal made by the Company with respect thereto. Each such Bank is
irrevocably authorized by the Company to endorse its Note(s) and each Bank's
record shall be conclusive absent manifest error; provided, however, that the
failure of a Bank to make, or an error in making, a notation thereon with
respect to any Loan shall not limit or otherwise affect the obligations of the
Company hereunder or under any such Note to such Bank.
(c) Effective on the Closing Date, all indebtedness (whether for
principal, interest, fees or otherwise) previously evidenced by loan accounts or
records of Existing Banks or by promissory notes issued to Existing Banks under
the Existing Credit Agreement (the "Existing Accounts and Notes") shall
automatically, and without further action on the part of the Banks or the
Company, become evidenced by the loan accounts or records described in
subsection (a) or by one or more Notes described in subsection (b), as the case
may be. To that extent, the loan accounts or records described in subsection (a)
and the Notes described in subsection (b) (if any) are established and/or issued
in renewal of, and evidence the same indebtedness formerly evidenced by, the
Existing Accounts and Notes, as well as evidencing all Loans made pursuant to
this Agreement.
2.3 Procedure for Borrowing. (a) Each Borrowing shall be made upon the
Company's irrevocable telephonic or written notice delivered to the Agent in the
form of a Notice of Borrowing, if written and promptly confirmed by delivery of
a form of Notice of Borrowing, if telephonic, which written or telephonic notice
must be received by the Agent prior to 9:00 a.m. (Chicago time) (i) two Business
Days prior to the requested Borrowing Date, in the case of Eurodollar Rate
Loans; and (ii) on the requested Borrowing Date, in the case of Base Rate Loans,
specifying:
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(A) the amount of the Borrowing, which shall be in an
aggregate minimum amount of $5,000,000 or any multiple of $1,000,000 in
excess thereof;
(B) the requested Borrowing Date, which shall be a Business
Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to such
Loans included in such notice. If the Notice of Borrowing fails to
specify the duration of the Interest Period for any Borrowing comprised
of Eurodollar Rate Loans, such Interest Period shall be three months.
(b) The Agent will promptly notify each Bank of its receipt of any
Notice of Borrowing and of the amount of such Bank's Pro Rata Share of that
Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 1:00 p.m. (Chicago time) on the Borrowing Date requested by
the Company in funds immediately available to the Agent. The proceeds of all
such Loans will then be made available to the Company by the Agent by wire
transfer in accordance with written instructions provided to the Agent by the
Company of like funds as received by the Agent.
(d) After giving effect to any Borrowing, there may not be more than
ten different Interest Periods in effect.
2.4 Conversion and Continuation Elections. (a) The Company may, upon
irrevocable written or telephonic notice (promptly confirmed in writing, if
telephonic) to the Agent in accordance with subsection 2.4(b):
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the
case of Eurodollar Rate Loans, to convert any such Loans (or any part
thereof in an amount not less than $5,000,000, or that is in an
integral multiple of $1,000,000 in excess thereof) into Loans of any
other Type; or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any Eurodollar Rate Loans having Interest Periods
expiring on such day (or any part thereof in an amount not less than
$5,000,000, or that is in an integral multiple of $1,000,000 in excess
thereof);
provided, that if at any time the aggregate amount of Eurodollar Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000, such Eurodollar Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the right
of the Company to continue such Loans as, and convert such Loans into,
Eurodollar Rate Loans shall terminate.
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(b) The Company shall give written or telephonic notice to be received
by the Agent not later than 9:00 a.m. (Chicago time) at least (i) two Business
Days in advance of the Conversion/Continuation Date, if the Loans are to be
converted into or continued as Eurodollar Rate Loans; and (ii) on the
Conversion/Continuation Date, if the Loans are to be converted into Base Rate
Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or renewed;
(C) the Type of Loans resulting from the proposed conversion
or continuation; and
(D) in the case of conversions into or continuations of
Eurodollar Rate Loans, the duration of the requested Interest Period.
Such notice, if written, shall be in the form of a Notice of
Conversion/Continuation and, if telephonic, shall be confirmed with a Notice of
Conversion/Continuation.
(c) If upon the expiration of any Interest Period applicable to
Eurodollar Rate Loans, the Company has failed to select timely a new Interest
Period to be applicable to such Eurodollar Rate Loans or if any Default or Event
of Default then exists, the Company shall be deemed to have elected to convert
such Eurodollar Rate Loans into Base Rate Loans effective as of the expiration
date of such Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of a Notice
of Conversion/Continuation, or, if no timely notice is provided by the Company,
the Agent will promptly notify each Bank of the details of any automatic
conversion. All conversions and continuations shall be made ratably according to
the respective outstanding principal amounts of the Loans with respect to which
the notice was given held by each Bank.
(e) Unless the Majority Banks otherwise agree, during the existence of
a Default or Event of Default, the Company may not elect to have a Loan
converted into or continued as a Eurodollar Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
there may not be more than five different Interest Periods in effect.
2.5 Changes in Aggregate Commitments. The Company may, upon not less
than four Business Days' prior notice to the Agent, terminate the Commitments,
or permanently reduce the Commitments by an aggregate minimum amount of
$5,000,000 or any multiple of $1,000,000 in excess thereof; unless, after giving
effect thereto and to any prepayments of Loans made on the effective date
thereof, the then-outstanding principal amount of the Loans would exceed the
amount of the combined Commitments then in effect. Once reduced in accordance
with this Section 2.5, the Commitments may not be increased. Any reduction of
the Commitments shall be applied to each Bank according to its Pro Rata Share.
All accrued
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commitment fees to, but not including the effective date of any reduction or
termination of Commitments, shall be paid on the effective date of such
reduction or termination.
2.6 Optional Prepayments. Subject to Section 3.4, the Company may, at
any time or from time to time, upon not less than one Business Day's irrevocable
notice to the Agent (in the case of Base Rate Loans) and three Business Days'
irrevocable notice to the Agent (in the case of Eurodollar Rate Loans), ratably
prepay Loans in whole or in part, in minimum amounts of $1,000,000 or any
multiple of $1,000,000 in excess thereof. Such notice of prepayment shall
specify the date and amount of such prepayment and the Type(s) of Loans to be
prepaid. The Agent will promptly notify each Bank of its receipt of any such
notice, and of such Bank's Pro Rata Share of such prepayment. If such notice is
given by the Company, the Company shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein, together with, in the case of Eurodollar Rate Loans, accrued interest
to each such date on the amount prepaid and any amounts required pursuant to
Section 3.4.
2.7 Repayment. The Company shall repay to the Banks on the Termination
Date the aggregate principal amount of Loans outstanding on such date.
2.8 Interest. (a) Each Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per annum
equal to the Eurodollar Rate or the Base Rate, as the case may be (and subject
to the Company's right to convert to other Types of Loans under Section 2.4).
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of Loans
under Section 2.6 for the portion of the Loans so prepaid and upon payment
(including prepayment) in full thereof and, during the existence of any Event of
Default, interest shall be paid on demand of the Agent at the request or with
the consent of the Majority Banks.
(c) Notwithstanding subsection (a) of this Section, while any Event of
Default exists or after acceleration, the Company shall pay interest (after as
well as before entry of judgment thereon to the extent permitted by law) on the
principal amount of all outstanding Loans, at a rate per annum which is
determined by adding 2% per annum to the Applicable Margin then in effect for
such Loans; provided, however, that, on and after the expiration of any Interest
Period applicable to any Eurodollar Rate Loan outstanding on the date of
occurrence of such Event of Default or acceleration, the principal amount of
such Eurodollar Rate Loan shall, during the continuation of such Event of
Default or after acceleration, bear interest at a rate per annum equal to the
Base Rate plus 2%.
(d) Anything herein to the contrary notwithstanding, the obligations of
the Company to any Bank hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Bank would be contrary to the provisions of
any law applicable to such Bank limiting the highest rate of
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interest that may be lawfully contracted for, charged or received by such Bank,
and in such event the Company shall pay such Bank interest at the highest rate
permitted by applicable law.
2.9 Fees. (a) Arrangement, Agency Fees. The Company shall pay an
arrangement fee to the Lead Arranger for the Lead Arranger's own account, and
shall pay an agency fee to the Agent for the Agent's own account, as required by
the letter agreement ("Fee Letter") between the Company and the Lead Arranger
and Agent dated December 12, 2001.
(b) Facility Fee. The Company shall pay to the Agent for the account of
each Bank a facility fee on the Bank's Commitment (regardless of usage),
computed on a quarterly basis in arrears on the last Business Day of each
calendar quarter, equal to the Facility Fee Rate. Such facility fee shall accrue
from the date hereof to the Termination Date and shall be due and payable
quarterly in arrears on the last Business Day of each calendar quarter
commencing on March 31, 2002 through the Termination Date, with the final
payment to be made on the Termination Date; provided that, in connection with
any reduction or termination of Commitments under Section 2.5, the accrued
facility fee calculated for the period ending on such date shall also be paid on
the date of such reduction or termination, with the following quarterly payment
being calculated on the basis of the period from such reduction or termination
date to such quarterly payment date. The facility fees provided in this
subsection shall accrue at all times after the above-mentioned commencement
date, including at any time during which one or more conditions in Article IV
are not met.
(c) Upfront Fee. The Company shall pay an upfront fee to the Lead
Arranger for the ratable benefit of the Banks as required by the Fee Letter.
2.10 Computation of Fees and Interest. (a) All computations of fees and
interest shall be made on the basis of a 360-day year and actual days elapsed
(which results in more interest being paid than if computed on the basis of a
365-day year). Interest and fees shall accrue during each period during which
interest or such fees are computed from the first day thereof to the last day
thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Banks in the absence of manifest
error.
2.11 Payments by the Company. (a) All payments to be made by the
Company shall be made without set-off, recoupment or counterclaim. Except as
otherwise expressly provided herein, all payments by the Company shall be made
to the Agent for the account of the Banks at the Agent's Payment Office, and
shall be made in dollars and in immediately available funds, no later than 2:00
p.m. (Chicago time) on the date specified herein. The Agent will promptly
distribute to each Bank its Pro Rata Share (or other applicable share as
expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than 2:00 p.m. (Chicago time) shall be
deemed to have been received on the following Business Day and any applicable
interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of "Interest
Period" herein, whenever any payment is due on a day other than a Business Day,
such payment shall
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be made on the following Business Day, and such extension of time shall in such
case be included in the computation of interest or fees, as the case may be.
(c) Unless the Agent receives notice from the Company prior to the date
on which any payment is due to the Banks that the Company will not make such
payment in full as and when required, the Agent may assume that the Company has
made such payment in full to the Agent on such date in immediately available
funds and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Bank on such due date an amount equal to the
amount then due such Bank. If and to the extent the Company has not made such
payment in full to the Agent, each Bank shall repay to the Agent on demand such
amount distributed to such Bank, together with interest thereon at the Federal
Funds Rate for each day from the date such amount is distributed to such Bank
until the date repaid.
2.12 Payments by the Banks to the Agent. (a) Unless the Agent receives
notice from a Bank on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at least one Business Day prior to the date of
such Borrowing, that such Bank will not make available as and when required
hereunder to the Agent for the account of the Company the amount of that Bank's
Pro Rata Share of the Borrowing, the Agent may assume that each Bank has made
such amount available to the Agent in immediately available funds on the
Borrowing Date and the Agent may (but shall not be so required), in reliance
upon such assumption, make available to the Company on such date a corresponding
amount. If and to the extent any Bank shall not have made its full amount
available to the Agent in immediately available funds and the Agent in such
circumstances has made available to the Company such amount, that Bank shall on
the Business Day following such Borrowing Date make such amount available to the
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Agent submitted to any Bank with respect to amounts
owing under this subsection (a) shall be conclusive, absent manifest error. If
such amount is so made available, such payment to the Agent shall constitute
such Bank's Loan on the date of Borrowing for all purposes of this Agreement. If
such amount is not made available to the Agent on the Business Day following the
Borrowing Date, the Agent will notify the Company of such failure to fund and,
upon demand by the Agent, the Company shall pay such amount to the Agent for the
Agent's account, together with interest thereon for each day elapsed since the
date of such Borrowing, at a rate per annum equal to the interest rate
applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a Loan on
such Borrowing Date, but no Bank shall be responsible for the failure of any
other Bank to make the Loan to be made by such other Bank on any Borrowing Date.
2.13 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Bank shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its Pro Rata Share, such Bank shall
immediately (a) notify the Agent of such fact, and (b) purchase from the other
Banks such participations in the Loans made by them as shall be
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necessary to cause such purchasing Bank to share the excess payment pro rata
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Bank, such purchase shall to
that extent be rescinded and each other Bank shall repay to the purchasing Bank
the purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Company agrees
that any Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 10.9) with respect to such
participation as fully as if such Bank were the direct creditor of the Company
in the amount of such participation. The Agent will keep records (which shall be
conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Banks following
any such purchases or repayments.
2.14 Extension of Termination Date. At least 30 days but not more than
60 days prior to the Termination Date, the Company, by written notice to the
Agent, may request one extension of the Termination Date for an additional
period of 364 days. The Agent shall promptly notify each Bank of such request,
and each Bank shall in turn, in its sole discretion, within 21 days after
receipt of such notice from the Agent, notify the Company and the Agent in
writing as to whether such Bank will consent to such extension. If any Bank
shall fail to notify the Agent and the Company in writing of its consent to any
such request for extension of the Termination Date by such time, such Bank shall
be deemed to have not consented to such extension request. The Agent shall
notify the Company on or prior to the scheduled Termination Date of the decision
of the Banks regarding the Company's request for an extension of the Termination
Date. If all the Banks consent in writing to such request as provided above, the
Termination Date shall, effective as at the scheduled Termination Date set forth
in clause (a) of the definition thereof in Section 1.1, be automatically
extended for a period of 364 days; provided that on such date the applicable
conditions set forth in Article IV shall be satisfied.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 Taxes. (a) Any and all payments by the Company to each Bank or the
Agent under this Agreement and any other Loan Document shall be made free and
clear of, and without deduction or withholding for any Taxes. In addition, the
Company shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless each Bank and the
Agent for the full amount of Taxes or Other Taxes (including any Taxes or Other
Taxes imposed by any jurisdiction on amounts payable under this Section) paid by
the Bank or the Agent and any liability (including penalties, interest,
additions to tax and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or
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legally asserted. Payment under this indemnification shall be made within 30
days after the date the Bank or the Agent makes written demand therefor.
(c) If the Company shall be required by law to deduct or withhold any
Taxes or Other Taxes from or in respect of any sum payable hereunder to any Bank
or the Agent, then:
(i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section) such Bank or the Agent, as the case may be, receives an
amount equal to the sum it would have received had no such deductions
or withholdings been made;
(ii) the Company shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Company shall also pay to each Bank or the Agent for
the account of such Bank, at the time interest is paid, all additional
amounts which the respective Bank specifies as necessary to preserve
the after-tax yield the Bank would have received if such Taxes or Other
Taxes had not been imposed.
(d) Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes, the Company shall furnish the Agent the original or a
certified copy of a receipt evidencing payment thereof, or other evidence of
payment satisfactory to the Agent.
(e) If the Company is required to pay additional amounts to any Bank or
the Agent pursuant to subsection (c) of this Section, then such Bank shall use
reasonable efforts (consistent with legal and regulatory restrictions) to change
the jurisdiction of its Lending Office so as to eliminate any such additional
payment by the Company which may thereafter accrue, if such change in the
judgment of such Bank is not otherwise disadvantageous to such Bank.
3.2 Illegality. (a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Bank or its applicable Lending Office to make
Eurodollar Rate Loans, then, on notice thereof by the Bank to the Company
through the Agent, any obligation of that Bank to make Eurodollar Rate Loans
shall be suspended until the Bank notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
(b) If a Bank determines that it is unlawful to maintain any Eurodollar
Rate Loan, the Company shall, upon its receipt of notice of such fact and demand
from such Bank (with a copy to the Agent), prepay in full such Eurodollar Rate
Loans of that Bank then
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outstanding, together with interest accrued thereon and amounts required under
Section 3.4, either on the last day of the Interest Period thereof, if the Bank
may lawfully continue to maintain such Eurodollar Rate Loans to such day, or
immediately, if the Bank may not lawfully continue to maintain such Eurodollar
Rate Loan. If the Company is required to so prepay any Eurodollar Rate Loan,
then concurrently with such prepayment, the Company shall borrow from the
affected Bank, in the amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Bank to make or maintain Eurodollar Rate
Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Bank through the Agent that all Loans which would otherwise be
made by the Bank as Eurodollar Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Agent under this Section, the
affected Bank shall designate a different Lending Office with respect to its
Eurodollar Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of the Bank be
illegal or otherwise disadvantageous to the Bank.
3.3 Increased Costs and Reduction of Return. (a) If any Bank determines
that, due to either (i) the introduction of or any change in or in the
interpretation of any law or regulation or (ii) the compliance by that Bank with
any guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in the
cost to such Bank of agreeing to make or making, funding or maintaining any
Eurodollar Rate Loans, then the Company shall be liable for, and shall from time
to time, upon demand (with a copy of such demand to be sent to the Agent), pay
to the Agent for the account of such Bank, additional amounts as are sufficient
to compensate such Bank for such increased costs.
(b) If any Bank shall have determined that (i) the introduction of any
Capital Adequacy Regulation, (ii) any change in any Capital Adequacy Regulation,
(iii) any change in the interpretation or administration of any Capital Adequacy
Regulation by any central bank or other Governmental Authority charged with the
interpretation or administration thereof, or (iv) compliance by the Bank (or its
Lending Office) or any corporation controlling the Bank with any Capital
Adequacy Regulation, affects or would affect the amount of capital required or
expected to be maintained by the Bank or any corporation controlling the Bank
and (taking into consideration such Bank's or such corporation's policies with
respect to capital adequacy and such Bank's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitments, loans, credits or obligations under this Agreement, then, upon
demand of such Bank to the Company through the Agent, the Company shall pay to
the Bank, from time to time as specified by the Bank, additional amounts
sufficient to compensate the Bank for such increase.
3.4 Funding Losses. The Company shall reimburse each Bank and hold each
Bank harmless from any loss or expense which the Bank may sustain or incur as a
consequence of:
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(a) the failure of the Company to make on a timely basis any payment of
principal of any Eurodollar Rate Loan;
(b) the failure of the Company to borrow, continue or convert a Loan
after the Company has given (or is deemed to have given) a Notice of Borrowing
or a Notice of Conversion/Continuation;
(c) the failure of the Company to make any prepayment in accordance
with any notice delivered under Section 2.6; -
(d) the prepayment or other payment (including after acceleration
thereof) of a Eurodollar Rate Loan on a day that is not the last day of the
relevant Interest Period; or
(e) the automatic conversion under Section 2.4 of any Eurodollar Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Eurodollar Rate Loans or from fees
payable to terminate the deposits from which such funds were obtained. For
purposes of calculating amounts payable by the Company to the Banks under this
Section and under subsection 3.3(a), each Eurodollar Rate Loan made by a Bank
(and each related reserve, special deposit or similar requirement) shall be
conclusively deemed to have been funded at the Eurodollar Base Rate used in
determining the Eurodollar Rate for such Eurodollar Rate Loan by a matching
deposit or other borrowing in the London interbank market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan is
in fact so funded.
3.5 Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the Eurodollar
Rate for any requested Interest Period with respect to a proposed Eurodollar
Rate Loan, or that the Eurodollar Rate applicable pursuant to subsection 2.8(a)
for any requested Interest Period with respect to a proposed Eurodollar Rate
Loan does not adequately and fairly reflect the cost to such Banks of funding
such Loan, the Agent will promptly so notify the Company and each Bank.
Thereafter, the obligation of the Banks to make or maintain Eurodollar Rate
Loans hereunder shall be suspended until the Agent with the consent of the
Majority Banks revokes such notice in writing. Upon receipt of such notice, the
Company may revoke any Notice of Borrowing or Notice of Conversion/Continuation
then submitted by it. If the Company does not revoke such Notice, the Banks
shall make, convert or continue the Loans, as proposed by the Company, in the
amount specified in the applicable notice submitted by the Company, but such
Loans shall be made, converted or continued as Base Rate Loans instead of
Eurodollar Rate Loans.
3.6 Certificates of Banks. Any Bank claiming reimbursement or
compensation under this Article III shall deliver to the Company (with a copy to
the Agent) a certificate setting forth in reasonable detail the amount payable
to the Bank hereunder and such certificate shall be conclusive and binding on
the Company in the absence of manifest error.
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3.7 Substitution of Banks. Upon the receipt by the Company from any
Bank (an "Affected Bank") of a claim for compensation under Section 3.3, the
Company may: (i) request the Affected Bank to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Company to acquire
and assume all or a ratable part of all of such Affected Bank's Loans and
Commitment (a "Replacement Bank"); (ii) request one or more of the other Banks
to acquire and assume all or part of such Affected Bank's Loans and Commitment;
or (iii) designate a Replacement Bank. Any such designation of a Replacement
Bank under clause (i) or (iii) shall be subject to the prior written consent of
the Agent (which consent shall not be unreasonably withheld)
3.8 Survival. The agreements and obligations of the Company in this
Article III shall survive the payment of all other Obligations.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Conditions of Initial Loans. The obligation of each Bank to make
its initial Loan hereunder is subject to the condition that the Agent have
received on or before the Closing Date all of the following, in form and
substance satisfactory to the Agent and each Bank, and in sufficient copies for
each Bank:
(a) Credit Agreement. This Agreement executed by each party thereto;
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors of the
Company (or a committee thereof having power to authorize the
transactions contemplated hereby) authorizing the transactions
contemplated hereby, certified as of the Closing Date by the Secretary
or an Assistant Secretary of the Company; and
(ii) A certificate of the Secretary or Assistant Secretary of
the Company certifying the names and true signatures of the officers of
the Company authorized to execute, deliver and perform this Agreement,
and all other Loan Documents to be delivered by it hereunder;
(c) Organization Documents. The articles or certificate of
incorporation and the bylaws of the Company as in effect on the Closing Date,
certified by the Secretary or Assistant Secretary of the Company as of the
Closing Date.
(d) Legal Opinions. An opinion of Xxxxx X. Xxxxx, counsel to the
Company and addressed to the Agent and the Banks, substantially in the form of
Exhibit D;
(e) Payment of Fees. Evidence of payment by the Company of all accrued
and unpaid fees, costs and expenses to the extent then due and payable on the
Closing Date;
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including any such costs, fees and expenses arising under or referenced in
Sections 2.9 and 10.4;
(f) Certificate. A certificate signed by a Responsible Officer, dated
as of the Closing Date, stating that:
(i) the representations and warranties contained in Article V
are true and correct on and as of such date, as though made on and as
of such date;
(ii) no Default or Event of Default exists or would result
from the initial Borrowing; and
(iii) there has occurred since May 31, 2001, no event or
circumstance that has resulted or could reasonably be expected to
result in a Material Adverse Effect;
(g) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may request.
4.2 Conditions to All Borrowings. The obligation of each Bank to make
any Loan to be made by it (including its initial Loan) is subject to the
satisfaction of the following conditions precedent in the relevant Borrowing
Date:
(a) Notice of Borrowing. The Agent shall have received a Notice of
Borrowing;
(b) Continuation of Representations and Warranties. The representations
and warranties in Article V shall be true and correct on and as of such
Borrowing Date with the same effect as if made on and as of such Borrowing Date
(except to the extent such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct as of such earlier
date); and
(c) No Existing Default. No Default or Event of Default shall exist or
shall result from such Borrowing.
Each Notice of Borrowing submitted by the Company hereunder shall constitute a
representation and warranty by the Company hereunder, as of the date of each
such notice and as of each Borrowing Date, that the conditions in Section 4.2
are satisfied.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Bank that:
5.1 Corporate Existence and Power. The Company and each of its
Subsidiaries:
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(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;
(c) is duly qualified as a foreign corporation and is licensed and in
good standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
or license; and
(d) is in compliance with all Requirements of Law; except, with respect
to clauses (c) and (d), to the extent that the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
5.2 Corporate Authorization; No Contravention. The execution, delivery
and performance by the Company and its Subsidiaries of this Agreement and each
other Loan Document to which such Person is party, have been duly authorized by
all necessary corporate action, and do not and will not:
(a) contravene the terms of any of that Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any Contractual Obligation
to which such Person is a party or any order, injunction, writ or decree of any
Governmental Authority to which such Person or its property is subject; or
(c) violate any Requirement of Law, except to the extent that such
violation could not reasonably be expected to have a Material Adverse Effect.
5.3 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Company or
any of its Subsidiaries of the Agreement or any other Loan Document.
5.4 Binding Effect. This Agreement and each other Loan Document to
which the Company or any of its Subsidiaries is a party constitute the legal,
valid and binding obligations of the Company and any or its Subsidiaries to the
extent it is a party thereto, enforceable against such Person in accordance with
their respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement or creditors'
rights generally or by equitable principles relating to enforceability.
5.5 Litigation. There are no actions, suits, proceedings, claims or
disputes pending, or to the best knowledge of the Company, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, against the Company, or its Subsidiaries or any of their respective
properties which:
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(a) purport to affect or pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) if determined adversely to the Company or its Subsidiaries, would
reasonably be expected to have a Material Adverse Effect. No injunction, writ,
temporary restraining order or any order of any nature has been issued by any
court or other Governmental Authority purporting to enjoin or restrain the
execution, delivery or performance of this Agreement or any other Loan Document,
or directing that the transactions provided for herein or therein not be
consummated as herein or therein provided.
5.6 No Default. No Default or Event of Default exists or would result
from the incurring of any Obligations by the Company or the execution, delivery
and performance of a Guaranty by any Subsidiary. As of the Closing Date, neither
the Company nor any Subsidiary is in default under or with respect to any
Contractual Obligation in any respect which, individually or together with all
such defaults could reasonably be expected to have a Material Adverse Effect, or
that would, if such default had occurred after the Closing Date, create an Event
of Default under subsection 8.1(e).
5.7 ERISA Compliance.
(a) During the twelve-consecutive-month period prior to the date of the
execution and delivery of this Agreement or the making of any Loan hereunder,
(i) no steps have been taken to terminate any Pension Plan and (ii) no
contribution failure has occurred with respect to any Pension Plan sufficient to
give rise to a lien under Section 302(f) of ERISA. No condition exists or event
or transaction has occurred with respect to any Pension Plan which might result
in the incurrence by the Company or any Subsidiary of any material liability,
fine or penalty.
(b) All contributions (if any) have been made to any Multiemployer Plan
that are required to be made by the Company or any other member of the
Controlled Group under the terms of the plan or of any collective bargaining
agreement or by applicable law; neither the Company nor any member of the
Controlled Group has withdrawn or partially withdrawn from any Multiemployer
Plan (except a single withdrawal, with respect to which the liability of the
Company and the members of the Controlled Group shall not exceed $l,000,000),
incurred any withdrawal liability with respect to any such plan, received notice
of any claim or demand for withdrawal liability or partial withdrawal liability
from any such plan, and no condition has occurred which, or continued, might
result in a withdrawal or partial withdrawal from any such plan; and neither the
Company nor any member of the Controlled Group has received any notice that any
Multiemployer Plan is in reorganization, that increased contributions may be
required to avoid a reduction in plan benefits or the imposition of any excise
tax, that any such plan is or has been funded at a rate less than that required
under Section 412 of the Code, that any such plan is or may be terminated, or
that any such plan is or may become insolvent.
5.8 Use of Proceeds; Margin Regulations. The proceeds of the Loans are
to be used solely for the purposes set forth in and permitted by Section 6.12
and Section 7.7.
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Neither the Company nor any Subsidiary is generally engaged in the business of
purchasing or selling Margin Stock or extending credit for the purpose of
purchasing or carrying Margin Stock.
5.9 Title to Properties. The Company and each Subsidiary have good
record and marketable title in fee simple to, or valid leasehold interests in
all real property necessary or used in the ordinary conduct of their respective
businesses, except for such defects in title as could not, individually or in
the aggregate, have a Material Adverse Effect. The property of the Company and
its Subsidiaries is subject to no Liens, other than Permitted Liens.
5.10 Taxes. The Company and its Subsidiaries have filed all Federal and
other material tax returns and reports required to be filed, and have paid all
Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment against the Company or
any Subsidiary that would, if made, have a Material Adverse Effect.
5.11 Financial Condition. (a) The audited consolidated financial
statements of the Company and its Subsidiaries dated May 31, 2001 and the
unaudited consolidated financial statements of the Company and its Subsidiaries
dated August 30, 2001; and the related consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal year or period
ended on such dates:
(i) Were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly
noted therein;
(ii) fairly present the financial condition of the Company and
its Subsidiaries as of the date thereof and results of operations for
the period covered thereby; and
(iii) show all material indebtedness and other liabilities,
direct or contingent, of the Company and its consolidated Subsidiaries
as of the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.
(b) Since May 31, 2001, there has been no Material Adverse Effect.
5.12 Environmental Matters. The Company and its Subsidiaries conduct in
the ordinary course of business a review of the effect of existing Environmental
Laws and existing Environmental Claims on its business, operations and
properties, and as a result thereof the Company has reasonably concluded that
such Environmental Laws and Environmental Claims could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.
5.13 Regulated Entities. None of the Company, any person controlling
the Company, or any Subsidiary, is an "Investment Company" within the meaning of
the
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Investment Company Act of 1940. The Company is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other Federal
or state statute or regulation limiting its ability to incur Indebtedness.
5.14 No Burdensome Restrictions. Neither the Company nor any Subsidiary
is a party to or bound by any Contractual Obligation, or subject to any
restriction in any Organization Document, or any Requirement of Law, which could
reasonably be expected to have a Material Adverse Effect.
5.15 Copyrights, Patents, Trademarks and Licenses, etc. The Company or
its Subsidiaries own or are licensed or otherwise have the right to use all of
the patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person, except to the extent any such conflict could not reasonably
be expected to have a Material Adverse Effect. To the best knowledge of the
Company, no slogan or other advertising device, product, process, method,
substance, part or other material now employed, or now contemplated to be
employed, by the Company or any Subsidiary infringes upon any rights held by any
other Person. No claim or litigation regarding any of the foregoing is pending
or threatened, and no patent, invention, device, application, principle or any
statute, law, rule, regulation, standard or code is pending or, to the knowledge
of the Company, proposed, which, in either case, could reasonably be expected to
have a Material Adverse Effect.
5.16 Subsidiaries. As of the Closing Date, the Company has no
Subsidiaries other than those specifically disclosed in part (a) of Schedule
5.16 hereto and, except as specifically disclosed in part (b) of Schedule 5.16
has no equity investments in any other corporation or entity, which, as to any
one corporation or entity, are equal to or greater than 20% of the aggregate
ownership interests in such corporation or entity or the value of which equity
investments in any one corporation or entity is equal to or greater than
$100,000.
5.17 Insurance. The properties of the Company and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of the Company, in such amounts, with such deductibles and covering such risks
as are customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Company or such Subsidiary operates.
5.18 Full Disclosure. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Company to the Banks prior to the Closing Date), contains any
untrue statement of a material fact or omits any material fact required to be
stated therein or necessary
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to make the statements made therein, in light of the circumstances under which
they are made, not misleading as of the time when made or delivered.
5.19 Subsidiary Indebtedness. No Subsidiary has outstanding any
Contingent Obligations with respect to Indebtedness of the Company.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks
waive compliance in writing:
6.1 Financial Statements. The Company shall deliver to the Agent and
the Banks, in form and detail satisfactory to the Agent and the Majority Banks:
(a) as soon as available, but not later than 110 days after the end of
each fiscal year, a copy of the audited consolidated balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Ernst & Young
LLP or another nationally recognized independent public accounting firm
("Independent Auditor") which report shall state that such consolidated
financial statements present fairly the financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years. Such opinion shall not be qualified or limited because of a restricted or
limited examination by the Independent Auditor of any material portion of the
Company's or any Subsidiary's records;
(b) as soon as available, but not later than 60 days after the end of
each of the first three fiscal quarters of each fiscal year, a copy of the
unaudited consolidated balance sheet of the Company and its Subsidiaries as of
the end of such quarter and the related consolidated statements of income,
shareholders' equity and cash flows for the period commencing on the first day
and ending on the last day of such quarter, and certified by a Responsible
Officer as fairly presenting, in accordance with GAAP (subject to ordinary, good
faith year-end audit adjustments), the financial position and the results of
operations of the Company and the Subsidiaries;
6.2 Certificates; Other Information. The Company shall furnish to the
Agent and the Banks:
(a) concurrently with the delivery of the financial statements referred
to in subsections 6.1(a) and (b), a Compliance Certificate executed by a
Responsible Officer;
(b) promptly, copies of all financial statements and reports that the
Company sends to its shareholders, and copies of all financial statements and
regular, periodical or
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special reports (including Forms 10K, 10Q and 8K) that the Company or any
Subsidiary may make to, or file with, the SEC, any securities exchange or the
National Association of Securities Dealers, Inc.; and
(c) promptly, such additional information regarding the business,
financial or corporate affairs or the Company or any Subsidiary as the Agent, at
the request of any Bank, may from time to time request.
6.3 Notices. The Company shall promptly notify the Agent and each Bank:
(a) of the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that foreseeably will
become a Default or Event of Default;
(b) of any matter that has resulted or may result in a Material Adverse
Effect, including (i) breach or non-performance of, or any default under, a
Contractual Obligation of the Company or any Subsidiary; (ii) any dispute,
litigation, investigation, proceeding or suspension between the Company or any
Subsidiary and any Governmental Authority; or (iii) the commencement of, or any
material development in, any litigation or proceeding affecting the Company or
any Subsidiary; including pursuant to any applicable Environmental Laws;
(c) of the institution of any steps by any member of the Controlled
Group or any other Person to terminate any Pension Plan, or the failure or any
member of the Controlled Group to make a required contribution to any Pension
Plan (if such failure is sufficient to give rise to a lien under Section 302(f)
of ERISA) or to any Multiemployer Plan, or the taking of any action with respect
to a Pension Plan which could result in the requirement that the Company furnish
a bond on or other security to the PBGC or such Pension Plan, or the occurrence
of any event with respect to any Pension Plan or Multiemployer Plan which could
result in the incurrence by any member of the Controlled Group of any material
liability, fine or penalty (including any claim or demand for withdrawal
liability or partial withdrawal from any Multiemployer Plan), or any material
increase in the contingent liability of the Company with respect to any
post-retirement Welfare Plan benefit, or any notice that any Multiemployer Plan
is in reorganization, that increased contributions may be required to avoid a
reduction in plan benefits or the imposition of an excise tax, that any such
plan is or has been funded at a rate less than that required under Section 412
of the Code, that any such plan is or may be terminated or that any such plan is
or may become insolvent;
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary Proposes to take with respect thereto and at what time. Each notice
under subsection 6.3(a) shall describe with particularity any and all
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clauses or provisions of this Agreement or other Loan Document that have been
(or foreseeably will be) breached or violated.
6.4 Preservation of Corporate Existence, Etc. The Company shall and
shall cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation;
(b) preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
or desirable in the normal conduct of its business except in connection with
transactions permitted by Section 7.3 and sales or assets permitted by Section
7.2;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks, trade
names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
6.5 Maintenance of Property. The Company shall maintain, and shall
cause each Subsidiary to maintain, and preserve all its property which is used
or useful in its business in good working order and condition, ordinary wear and
tear excepted and make all necessary repairs thereto and renewals and
replacements thereof except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
6.6 Insurance. The Company shall maintain, and shall cause each
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons.
6.7 Payment of Obligations. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by the Company or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien upon
its property; and
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(c) all indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
6.8 Compliance with Laws. The Company shall comply, and shall cause
each Subsidiary to comply, in all material respects with all Requirements of Law
of any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Poor Standards Act), except as such may be contested
in good faith or as to which a bona fide dispute may exist.
6.9 Employee Benefit Plans. The Company shall maintain and cause each
or its Subsidiaries to maintain, each Pension Plan in substantial compliance
with all applicable requirements of law and regulations.
6.10 Accounting; Inspection of Property and Books and Records. The
Company shall maintain a system of accounting established and administered in
accordance with sound business practices to permit preparation of financial
statements in accordance with GAAP consistently applied, and to comply with the
requirements of this Agreement and the other Loan Documents. The Company shall
maintain and shall cause each Subsidiary to maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall permit, and shall cause each Subsidiary to permit, representatives
and independent contractors of the Agent or any Bank to visit and inspect any of
their respective properties, to examine their respective corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the expense of
the Company and at such reasonable times during normal business hours and as
often as may be reasonably desired, upon reasonable advance notice to the
Company; provided, however, when an Event of Default exists the Agent or any
Bank may do any of the foregoing at the expense of the Company at any time
during normal business hours and without advance notice.
6.11 Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws except to the extent any such
noncompliance could not reasonably be expected to have a Material Adverse
Effect.
6.12 Use of Proceeds. The Company shall use the proceeds of the Loans
for working capital, capital expenditures, commercial paper backup and other
general corporate purposes not in contravention of any Requirement of Law or of
any Loan Document.
6.13 Contingent Obligations. If any Subsidiary shall have any
Contingent Obligations with respect to any Indebtedness of the Company, the
Company shall cause such Subsidiary to take such actions as are reasonably
necessary, or as the Agent or any Bank may reasonably request from time to time,
to guarantee the Obligations.
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ARTICLE VII
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks
waive compliance in writing:
7.1 Limitation on Liens. The Company shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, make, create, incur, assume or
suffer to exist any Lien upon or with respect to any part of its property,
whether now owned or hereafter acquired, other than the following ("Permitted
Liens"):
(a) Liens for taxes not delinquent or for taxes being contested in good
faith by appropriate proceedings and as to which adequate financial reserves
have been established on the books and records of the Company or any Subsidiary;
(b) Liens (other than any Lien imposed by ERISA) created and maintained
in the ordinary course of business which are not material in the aggregate, and
which would not constitute or result in a Material Adverse Effect, and which
constitute (i) pledges or deposits under worker's compensation laws,
unemployment insurance laws or similar legislation, (ii) good faith deposits in
connection with bids, tenders, contracts or leases to which the Company or a
Subsidiary is a party for a purpose other than borrowing money or obtaining
credit, including rent security deposits, (iii) Liens imposed by law, such as
those of carriers, warehousemen and mechanics, if payment of the obligation
secured thereby is not yet due, (iv) Liens securing taxes, assessments or other
charges or levies of any Governmental Authority not yet subject to penalties for
nonpayment, and (v) pledges or deposits to secure public or statutory
obligations of the Company or a Subsidiary, or surety, customs or appeal bonds
to which the Company or a Subsidiary is a party;
(c) Liens affecting real property which constitute minor survey
exceptions or defects or irregularities in title, minor encumbrances, easements
or reservations of, or rights of others for, rights of way, sewers, electric
lines, telegraph and telephone lines and other similar purposes, or zoning or
other restrictions as to the use of such real property; provided, however, that
all of the foregoing, in the aggregate, do not at any time materially detract
from the value of said properties or materially impair their use in the
operation of the businesses of the Company or any Subsidiary;
(d) each Lien described in Schedule 7.1 may be suffered to exist upon
the same terms as those existing on the date hereof, but no extension or renewal
thereof shall be permitted except for a refinancing in the ordinary course of
business for an amount not in excess of the original amount subject to such
Lien;
(e) purchase money Liens upon or in property of the Company or a
subsidiary acquired after the Closing Date; provided, however, that no such Lien
shall extend
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to or cover any other property of the Company or a Subsidiary or secure an
amount in excess of the lesser of the purchase price or the market value of such
property; and
(f) other Liens provided that the aggregate outstanding amount of
Indebtedness secured by all such other Liens shall not exceed $15,000,000 at any
time after the Closing Date.
7.2 Disposition of Assets. The Company shall not, and shall not suffer
or permit any Subsidiary to, directly or indirectly, sell, assign, lease,
convey, transfer or otherwise dispose of (whether in one or a series of
transactions) any property (including accounts and notes receivable, with or
without recourse) or enter into any agreement to do any of the foregoing,
except: (a) inventory sold in the ordinary course of business upon customary
credit terms and sales of obsolete or damaged material or equipment, (b) sales
of assets in connection with sale-leaseback transactions in an amount not to
exceed $10,000,000 and (c) other sales of assets not to exceed 10% of the
consolidated total assets of the Company and its Subsidiaries in any fiscal year
of the Company ending after the Closing Date; except that (x) any Subsidiary may
sell, lease, transfer or otherwise dispose of its assets to the Company or any
other Subsidiary; and (y) the Company may sell, lease, transfer or otherwise
dispose of assets in excess of the limitations set forth above if the proceeds
thereof (i) are used to purchase or are committed to purchase other property of
a similar nature of at least equivalent value within one year of such sale,
lease, transfer or other disposition or (ii) are used to prepay Senior
Indebtedness (including the Loans) on a pro-rata basis.
7.3 Merger; Purchase of Assets; Acquisitions; Etc. The Company shall
not, and shall not suffer or permit any Subsidiary to purchase or otherwise
acquire, whether in one or a series of transactions, all or a substantial
portion of the business, assets, rights, revenues or property, real, personal or
mixed, tangible or intangible, of any Person, or all or a substantial portion of
the capital stock of or other ownership interest in any other Person; nor merge
or consolidate or amalgamate with any other Person or take any other action
having a similar effect, nor enter into any Joint Venture or similar arrangement
with any other Person; provided, however, that this Section 7.3 shall not
prohibit any Acquisition by the Company or any of its Subsidiaries of any Person
engaged in substantially the same business as the Company or such Subsidiary if
(a) in the case of an Acquisition of stock or a merger, the acquired Person
shall be immediately merged with and into the Company or such Subsidiary which
shall be the surviving corporation, and (b) immediately after such Acquisition,
no Default or Event of Default shall exist or shall have occurred and be
continuing and, prior to the consummation of such Acquisition, the Company shall
have provided to the Bank a certificate of a Responsible Officer (attaching
computations to demonstrate compliance with all financial covenants hereunder)
stating that such Acquisition complies with this Section 7.3 and will not cause
a Default or Event of Default to occur or continue and that any other conditions
under this Agreement and the other Loan Documents relating to such transaction
have been satisfied; and provided, further, that this Section 7.3 shall not
prohibit any merger or consolidation solely between or among the Company and its
Subsidiaries, so long as the Company is the surviving person of such merger or
consolidation.
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7.4 Loans and Investments. The Company shall not and shall not suffer
or permit any Subsidiary to make or commit to make any Investment, other than:
(a) Investments in Cash Equivalents; (b) Investments in its existing
Subsidiaries; (c) Investments in new Subsidiaries consisting of partnerships or
limited liability companies engaged in the business of owning and operating
hotels or motels, movie theaters or restaurants; (d) loans or advances to
franchisees not to exceed $10,000,000, on a consolidated basis, in the aggregate
at any time after the Closing Date; (e) Investments listed in the attached
Schedule 7.4, (f) Investments (excluding contingent liabilities) to owners of
properties or businesses managed by the Company or a Subsidiary not to exceed
$15,000,000, on a consolidated basis, in the aggregate at any time after the
Closing Date; (g) Investments, consisting of contingent liabilities, to owners
of properties or businesses managed by the Company or a Subsidiary not to exceed
$10,000,000, on a consolidated basis, in the aggregate at any time after the
Closing Date; and (h) other Investments (including contingent liabilities) not
to exceed $3,000,000 on a consolidated basis, in the aggregate at any time after
the Closing Date.
7.5 Limitation on Subsidiary Indebtedness. The Company shall not permit
any Subsidiary to create, incur, assume, suffer to exist, or otherwise become or
remain directly or indirectly liable with respect to, any Indebtedness, except
Indebtedness, which when added to the Indebtedness secured by Liens permitted
under Sections 7.1(d), (e) and (f) shall not exceed 5% of Total Capitalization.
7.6 Transactions with Affiliates. The Company shall not, and shall not
suffer or permit any Subsidiary to, enter into any transaction with any
Affiliate of the Company, except upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Company or such
Subsidiary.
7.7 Use of Proceeds. The Company shall not, and shall not suffer or
permit any Subsidiary to, use any portion of the Loan proceeds, directly or
indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or otherwise
refinance indebtedness of the Company or others incurred to purchase or carry
Margin Stock, (iii) to extend credit for the purpose of purchasing or carrying
any Margin Stock, or (iv) to acquire any security in any transaction that is
subject to Section 13 or 14 of the Exchange Act.
7.8 Restricted Payments. The Company shall not, and shall not suffer or
permit any Subsidiary to, declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities on
account of any shares of any class of its capital stock, or purchase, redeem or
otherwise acquire for value any shares of its capital stock or any warrants,
rights or options to acquire such shares, now or hereafter outstanding, if a
Default or Event of Default has occurred and is continuing or would result from
any of the foregoing.
7.9 Change in Business. The Company shall not, and shall not suffer or
permit any Subsidiary to, change the nature of its business from that engaged in
on the date hereof or engage in any other businesses other than those in which
it is engaged on the date hereof or other than those related thereto.
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7.10 Accounting Changes. The Company shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
the Company or of any Subsidiary.
7.11 Funded Debt Ratio. The Company shall not permit or suffer the
ratio of Funded Debt to Total Capitalization to exceed at any time 0.55 to 1.0.
7.12 Fixed Charge Coverage Ratio. The Company shall not permit or
suffer the ratio at any fiscal quarter end for the four fiscal quarters then
ending of Adjusted Consolidated Cash Flow to Interest and Rental Expense to be
less than 3.0 to 1.0.
7.13 Subsidiary Dividends. The Company shall not, and shall not permit
any Subsidiary to, enter into any agreement that would restrict the ability of
any Subsidiary to pay dividends.
ARTICLE VIII
EVENTS OF DEFAULT
8.1 Event of Default. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment. The Company fails to pay, (i) when and as required to
be paid herein, any amount of principal of any Loan, or (ii) within three days
after the same becomes due, any interest, fee or any other amount payable
hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by the
Company or any Subsidiary made or deemed made herein, in any other Loan
Document, or which is contained in any certificate, document or financial or
other statement by the Company, any Subsidiary, or any Responsible Officer,
furnished at any time under this Agreement, or in or under any other Loan
Document, is incorrect in any material respect on or as of the date made or
deemed made; or
(c) Specific Defaults. The Company fails to perform or observe any
term, covenant or agreement contained in any of Section 6.1, 6.2, 6.3, 6.4, 6.9
or 6.12 or in Article VII; or
(d) Other Defaults. The Company or any Subsidiary party thereto fails
to perform or observe any other term or covenant contained in this Agreement or
any other Loan Document, and such default shall continue unremedied for a period
of 30 days after the earlier of (i) the date upon which a Responsible Officer
knew or reasonably should have known of such failure or (ii) the date upon which
written notice thereof is given to the Company by the Agent or any Bank; or
(e) Cross-Default. The Company or any Subsidiary (i) fails to make any
payment in respect of any Indebtedness or Contingent Obligation having an
aggregate principal
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amount (including undrawn committed or available amounts and including amounts
owing to all creditors under any combined or syndicated credit arrangement) of
more than $5,000,000 when due (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) and such failure continues after
the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure; or (ii) fails to perform or observe any
other condition or covenant, or any other event shall occur or condition exist,
under any agreement or instrument relating to any such Indebtedness or
Contingent Obligation, and such failure continues after the applicable grace or
notice period, if any, specified in the relevant document on the date of such
failure if the effect of such failure, event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause such Indebtedness to
be declared to be due and payable prior to its stated maturity, or such
Contingent Obligation to become payable or cash collateral in respect thereof to
be demanded; or
(f) Insolvency; Voluntary Proceedings. The Company or any Subsidiary
(i) ceases or fails to be solvent, or generally fails to pay, or admits in
writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding
is commenced or filed against the Company or any Subsidiary, or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of the Company's or any Subsidiary's
properties, and any such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process shall not be
released, vacated or fully bonded within 60 days after commencement, filing or
levy; (ii) the Company or any Subsidiary admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) the Company or any Subsidiary acquiesces in the appointment of a receiver,
trustee, custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion of its
property or business; or
(h) Pension Plans. (i) Institution of any steps by the Company or any
other Person to terminate a Pension Plan if as a result of such termination the
Company could be required to make a contribution to such Pension Plan, or could
incur a liability or obligation to such Pension Plan, in excess of $10,000,000;
(ii) a contribution failure occurs with respect to any Pension Plan sufficient
to give rise to a Lien under Section 302(f) of ERISA; or (iii) there shall occur
any withdrawal or partial withdrawal from a Multiemployer Plan and the
withdrawal liability (without unaccrued interest) to Multiemployer Plans as a
result of such withdrawal (including any outstanding withdrawal liability that
the Company and the Controlled Group have incurred on the date of such
withdrawal) exceeds $10,000,000; or
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(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of $10,000,000 or more, and the same shall remain
unvacated and unstayed pending appeal for a period of 30 days after the entry
thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or decree
is entered against the Company or any Subsidiary which does or would reasonably
be expected to have a Material Adverse Effect, and there shall be any period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(k) Change of Control. There occurs any Change of Control; or
(l) Loss of Licenses. The Company or any Subsidiary for any reason
loses any material license, permit or franchise, or the Company or any
Subsidiary suffers the imposition of any restraining order, escrow, suspension
or impound of funds in connection with any proceeding (judicial or
administrative) with respect to any material license, permit or franchise; or
(m) Adverse Change. There occurs a Material Adverse Effect.
8.2 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Banks,
(a) declare the commitment of each Bank to make Loans to be terminated,
whereupon such commitments shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Company; and
(c) exercise on behalf of itself and the Banks all rights and remedies
available to it and the Banks under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 8.1 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each Bank
to make Loans shall automatically terminate and the unpaid principal amount of
all outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable without further act of the Agent or any
Bank.
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8.3 Rights Not Exclusive. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE IX
THE AGENT
9.1 Appointment and Authorization. Each Bank hereby irrevocably
(subject to Section 9.9) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Agent
have or be deemed to have any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent.
9.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
9.3 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Banks for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Bank to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.
9.4 Reliance by Agent. The Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter,
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telegram, facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to the Company), independent accountants and
other experts selected by the Agent. The Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Majority Banks as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in acting, or
in refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Majority Banks and such request and
any action taken or failure to act pursuant thereto shall be binding upon all of
the Banks.
(a) For purposes of determining compliance with the conditions
specified in Section 4.1, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Bank.
9.5 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Agent for the account of the Banks, unless the Agent shall have
received written notice from a Bank or the Company referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". The Agent will notify the Banks of its receipt of any such
notice. The Agent shall take such action with respect to such Default or Event
of Default as may be requested by the Majority Banks in accordance with Article
VIII; provided, however, that unless and until the Agent has received any such
request, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable or in the best interest of the Banks.
9.6 Credit Decision. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Bank. Each Bank represents to the
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Company and its Subsidiaries, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Company hereunder. Each Bank also
represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such
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investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Company. Except for notices, reports and other documents
expressly herein required to be furnished to the Banks by the Agent, the Agent
shall not have any duty or responsibility to provide any Bank with any credit or
other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of the Company which may come
into the possession of any of the Agent-Related Persons.
9.7 Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Banks shall indemnify upon demand the Agent-Related
Persons (to the extent not reimbursed by or on behalf of the Company and without
limiting the obligation of the Company to do so), pro rata, from and against any
and all Indemnified Liabilities; provided, however, that no Bank shall be liable
for the payment to the Agent-Related Persons of any portion of such Indemnified
Liabilities resulting solely from such Person's gross negligence or willful
misconduct. Without limitation of the foregoing, each Bank shall reimburse the
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or on behalf
of the Company. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Agent.
9.8 Agent in Individual Capacity. Bank One and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though Bank One were not the Agent hereunder and
without notice to or consent of the Banks. The Banks acknowledge that, pursuant
to such activities, Bank One or its Affiliates may receive information regarding
the Company or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Company or such Subsidiary) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, Bank One shall have the same
rights and powers under this Agreement as any other Bank and may exercise the
same as though it were not the Agent, and the terms "Bank" and "Banks" include
Bank One in its individual capacity.
9.9 Successor Agent. The Agent may, and at the request of the Majority
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Majority Banks shall appoint from among the
Banks a successor agent for the Banks. If no successor agent is appointed prior
to the effective date of the resignation of the Agent, the Agent may appoint,
after consulting with the Banks and the Company, a successor agent from among
the Banks. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's
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appointment, powers and duties as Agent shall be terminated. After any retiring
Agent's resignation hereunder as Agent, the provisions of this Article IX and
Sections 10.4 and 10.5 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement. If no
successor agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring Agent's
resignation shall nevertheless thereupon become effective and the Banks shall
perform all of the duties of the Agent hereunder until such time, if any, as the
Majority Banks appoint a successor agent as provided for above.
9.10 Withholding Tax. (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Bank agrees with and in favor of the Agent, to deliver to
the Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, properly completed
IRS Forms 1001 and W-8 before the payment of any interest in the first
calendar year and before the payment of any interest in each third
succeeding calendar year during which interest may be paid under this
Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Bank, two properly completed and executed copies of IRS Form 4224
before the payment of any interest is due in the first taxable year of
such Bank and in each succeeding taxable year of such Bank during which
interest may be paid under this Agreement, and IRS Form W-9; and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
(b) If any Bank claims exemption from, or reduction of, withholding tax
under a United States tax treaty by providing IRS Form 1001 and such Bank sells,
assigns, grants a participation in, or otherwise transfers all or part of the
Obligations of the Company to such Bank, such Bank agrees to notify the Agent of
the percentage amount in which it is no longer the beneficial owner of
Obligations of the Company to such Bank. To the extent of such percentage
amount, the Agent will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding tax
by filing IRS Form 4224 with the Agent sells, assigns, grants a participation
in, or otherwise transfers all or part of the Obligations of the Company to such
Bank, such Bank agrees to undertake sole responsibility for complying with the
withholding tax requirements imposed by Sections 1441 and 1442 of the Code.
-43-
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Bank
an amount equivalent to the applicable withholding tax after taking into account
such reduction. If the forms or other documentation required by subsection (a)
of this Section are not delivered to the Agent, then the Agent may withhold from
any interest payment to such Bank not providing such forms or other
documentation an amount equivalent to the applicable withholding tax.
(e) If the IRS or any other Governmental Authority of the United States
or other jurisdiction asserts a claim that the Agent did not properly withhold
tax from amounts paid to or for the account of any Bank (because the appropriate
form was not delivered, was not properly executed, or because such Bank failed
to notify the Agent of a change in circumstances which rendered the exemption
from, or reduction of, withholding tax ineffective, or for any other reason)
such Bank shall indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax or otherwise, including penalties and interest,
and including any taxes imposed by any jurisdiction on the amounts payable to
the Agent under this Section, together with all costs and expenses (including
Attorney Costs). The obligation of the Banks under this subsection shall survive
the payment of all Obligations and the resignation or replacement of the Agent.
ARTICLE X
MISCELLANEOUS
10.1 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Company or any applicable Subsidiary therefrom, shall be
effective unless the same shall be in writing and signed by the Majority Banks
(or by the Agent at the written request of the Majority Banks) and the Company
and acknowledged by the Agent, and then any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no such waiver, amendment, or consent shall,
unless in writing and signed by all the Banks and the Company and acknowledged
by the Agent, do any of the following:
(a) increase (except as provided in Section 2.5) or extend the
Commitment of any Bank (or reinstate any Commitment terminated pursuant to
Section 8.2);
(b) postpone or delay any date for any scheduled payment of principal
or any date for payment of interest, fees or other amounts due to the Banks (or
any of them) hereunder or under any other Loan Document;
(c) reduce the principal of, or the rate of interest specified herein
on any Loan, or (subject to clause (ii) below) any fees or other amounts payable
hereunder or under any other Loan Document;
-44-
(d) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for the Banks or any of them to
take any action hereunder; or
(e) amend this Section, or Section 2.13, or any provision herein
providing for consent or other action by all Banks;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Majority Banks or all the
Banks, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (ii) the Fee Letter may be amended, or
rights or privileges thereunder waived, in a writing executed by the parties
thereto.
10.2 Notices. (a) All notices, requests and other communications shall
be in writing (including, unless the context expressly otherwise provides, by
facsimile transmission, provided that any matter transmitted by the Company by
facsimile (i) shall be immediately confirmed by a telephone call to the
recipient at the number specified on Schedule 10.2, and (ii) shall be followed
promptly by delivery of a hard copy original thereof) and mailed, faxed or
delivered, to the address or facsimile number specified for notices on Schedule
10.2; or, as directed to the Company or the Agent, to such other address as
shall be designated by such party in a written notice to the other parties, and
as directed to any other party, at such other address as shall be designated by
such party in a written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Article II or IX shall not be effective until actually
received by the Agent.
(c) Any agreement of the Agent and the Banks herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Company. The Agent and the Banks shall be entitled to rely on the
authority of any Person purporting to be a Person authorized by the Company to
give such notice and the Agent and the Banks shall not have any liability to the
Company or other Person on account of any action taken or not taken by the Agent
or the Banks in reliance upon such telephonic or facsimile notice. The
obligation of the Company to repay the Loans shall not be affected in any way or
to any extent by any failure by the Agent and the Banks to receive written
confirmation of any telephonic or facsimile notice or the receipt by the Agent
and the Banks of a confirmation which is at variance with the terms understood
by the Agent and the Banks to be contained in the telephonic or facsimile
notice.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Bank, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any
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right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
10.4 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Bank One (including in its capacity as Agent) and
the Lead Arranger within ten days after demand (subject to subsection 4.1(e))
for all costs and expenses incurred by Bank One (including in its capacity as
Agent) and the Lead Arranger in connection with the development, preparation,
delivery, administration and execution of, and any amendment, supplement, waiver
or modification to (in each case, whether or not consummated), this Agreement,
any Loan Document and any other documents prepared in connection herewith or
therewith, and the consummation of the transactions contemplated hereby and
thereby, including reasonable Attorney Costs incurred by Bank One (including in
its capacity as Agent) and the Lead Arranger with respect thereto; and
(b) pay or reimburse the Agent, the Lead Arranger and each Bank within
ten days after demand (subject to subsection 4.1(e)) for all costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or any other Loan Document during the existence of an Event of Default
or after acceleration of the Loans (including in connection with any "workout"
or restructuring regarding the Loans, and including in any Insolvency Proceeding
or appellate proceeding)
10.5 Indemnity. Whether or not the transactions contemplated hereby are
consummated, the Company shall indemnify and hold the Agent-Related Persons, and
each Bank and each of its respective officers, directors, employees, counsel,
agents and attorneys-in-fact (each, an "Indemnified Person") harmless from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, charges, expenses and disbursements (including
Attorney Costs) of any kind or nature whatsoever which may at any time
(including at any time following repayment of the Loans and the termination,
resignation or replacement of the Agent or replacement of any Bank) be imposed
on, incurred by or asserted against any such Person in any way relating to or
arising out of this Agreement or any document contemplated by or referred to
herein, or the transactions contemplated hereby, or any action taken or omitted
by any such Person under or in connection with any of the foregoing, including
with respect to any investigation, litigation or proceeding (including any
Insolvency Proceeding or appellate proceeding) related to or arising out of this
Agreement or the Loans or the use of the proceeds thereof, whether or not any
Indemnified Person is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"); provided, that the Company shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities
resulting solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
-46-
10.6 Payments Set Aside. To the extent that the Company makes a payment
to the Agent or the Banks, or the Agent or the Banks exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any Insolvency Proceeding or otherwise, then (a)
to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Bank severally agrees to pay to the Agent upon demand its pro rata share of
any amount so recovered from or repaid by the Agent.
10.7 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Bank.
10.8 Assignments, Participations, Etc. (a) Any Bank may, with the
written consent of the Company at all times other than during the existence of
an Event of Default and the Agent, which consents shall not be unreasonably
withheld, at any time assign and delegate to one or more Eligible Assignees
(provided that no written consent of the Company or the Agent shall be required
in connection with any assignment and delegation by a Bank to an Eligible
Assignee that is an Affiliate of such Bank) (each an "Assignee") all, or any
ratable part of all, of the Loans, the Commitments and the other rights and
obligations of such Bank hereunder, in a minimum amount of $5,000,000 (or the
remaining amount of such Bank's Loans and Commitment, if less); provided,
however, that the Company and the Agent may continue to deal solely and directly
with such Bank in connection with the interest so assigned to an Assignee until
(i) written notice of such assignment, together with payment instructions,
addresses and related information with respect to the Assignee, shall have been
given to the Company and the Agent by such Bank and the Assignee; (ii) such Bank
and its Assignee shall have delivered to the Company and the Agent an Assignment
and Acceptance in the form of Exhibit E ("Assignment and Acceptance") and (iii)
the assignor Bank or Assignee has paid to the Agent a processing fee in the
amount of $3,500 (including, without limitation, in connection with any
assignment by a Bank to a Bank).
(b) From and after the date that the Agent notifies the assignor Bank
that it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank under
the Loan Documents, and (ii) the assignor Bank shall, to the extent that rights
and obligations hereunder and under the other Loan Documents have been assigned
by it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.
-47-
(c) Within five Business Days after its receipt of notice by the Agent
that it has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in accordance
with subsection 10.8(a)) the Company shall execute and deliver to the Agent, new
Notes evidencing such Assignee's assigned Loans and Commitment and, if the
assignor Bank has retained a portion of its Loans and its Commitment,
replacement Notes in the principal amount of the Loans retained by the assignor
Bank (such Notes to be in exchange for, but not in payment of, the Notes held by
such Bank). Immediately upon each Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the addition
of the Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Bank pro tanto.
(d) Any Bank may at any time sell to one or more commercial banks or
other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Bank and the other interests of
that Bank (the "originating Bank") hereunder and under the other Loan Documents;
provided, however, that (i) the originating Bank's obligations under this
Agreement shall remain unchanged, (ii) the originating Bank shall remain solely
responsible for the performance of such obligations, (iii) the Company and the
Agent shall continue to deal solely and directly with the originating Bank in
connection with the originating Bank's rights and obligations under this
Agreement and the other Loan Documents, and (iv) no Bank shall transfer or grant
any participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, except to the extent such amendment, consent or waiver
would require unanimous consent of the Banks as described in the first proviso
to Section 10.1. In the case of any such participation, the Participant shall be
entitled to the benefit of Sections 3.1, 3.3 and 10.5 as though it were also a
Bank hereunder, and if amounts outstanding under this Agreement are due and
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall be deemed to have
the right of set-off in respect of its participating interest in amounts owing
under this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Bank under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Bank may
at any time create a security interest in, or pledge, all or any portion of its
rights under and interest in this Agreement and the Note held by it in favor of
any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.
10.9 Confidentiality. Each Bank agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Company and provided to it by the Company or any Subsidiary, or
by the Agent on such Company's or Subsidiary's behalf, under this Agreement or
any other Loan Document, and neither it nor any of its Affiliates shall use
-48-
any such information other than in connection with or in enforcement of this
Agreement and the other Loan Documents or in connection with other business now
or hereafter existing or contemplated with the Company or any Subsidiary; except
to the extent such information (i) was or becomes generally available to the
public other than as a result of disclosure by the Bank, or (ii) was or becomes
available on a non-confidential basis from a source other than the Company,
provided that such source is not bound by a confidentiality agreement with the
Company known to the Bank; provided, however, that any Bank may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Bank is subject or in connection with an
examination of such Bank by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the Agent, any
Bank or their respective Affiliates may be party; (E) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document; (F) to such Bank's independent auditors and other
professional advisors; (G) to any Participant or Assignee, actual or potential,
provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Banks hereunder; (H) as to any
Bank or its Affiliate, as expressly permitted under the terms of any other
document or agreement regarding confidentiality to which the Company or any
Subsidiary is party or is deemed party with such Bank or such Affiliate; and (I)
to its Affiliates.
10.10 Set-off. In addition to any rights and remedies of the Banks
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank is authorized at any time and from time to time, without
prior notice to the Company, any such notice being waived by the Company to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Bank to or for the credit or
the account of the Company against any and all Obligations owing to such Bank,
now or hereafter existing, irrespective of whether or not the Agent or such Bank
shall have made demand under this Agreement or any Loan Document and although
such Obligations may be contingent or unmatured. Each Bank agrees promptly to
notify the Company and the Agent after any such set-off and application made by
such Bank; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application.
10.11 Automatic Debits of Fees. With respect to any commitment fee,
arrangement fee, or other fee, or any other cost or expense (including Attorney
Costs) due and payable to the Agent, Bank One or the Lead Arranger under the
Loan Documents, the Company hereby irrevocably authorizes Bank One to debit any
deposit account of the Company with Bank One in an amount such that the
aggregate amount debited from all such deposit accounts does not exceed such fee
or other cost or expense. If there are insufficient funds in such deposit
accounts to cover the amount of the fee or other cost or expense then due, such
debits will be reversed (in whole or in part, in Bank One's sole discretion) and
such amount not debited shall be deemed to be unpaid. No such debit under this
Section shall be deemed a set-off.
-49-
10.12 Notification of Addresses, Lending Offices, Etc. Each Bank shall
notify the Agent in writing of any changes in the address to which notices to
the Bank should be directed, of addresses of any Lending Office, of payment
instructions in respect of all payments to be made to it hereunder and of such
other administrative information as the Agent shall reasonably request.
10.13 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
10.14 Severability. The illegality or unenforceability of any provision
of this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
10.15 No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the Banks, the
Agent and the Agent-Related Persons, and their permitted successors and assigns,
and no other Person shall be a direct or indirect legal beneficiary of, or have
any direct or indirect cause of action or claim in connection with, this
Agreement or any of the other Loan Documents.
10.16 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
ILLINOIS; PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT AND THE BANKS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT AND THE
BANKS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
10.17 Waiver of Jury Trial. THE COMPANY, THE BANKS AND THE AGENT EACH
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS
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AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE COMPANY, THE BANKS AND THE AGENT EACH AGREE THAT ANY SUCH
CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
10.18 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Banks and the Agent, and supersedes all prior or contemporaneous agreements
and understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
THE MARCUS CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------------
Title: President
---------------------------------------
BANK ONE, NA (Main Office Chicago),
as Agent
By: /s/ X.X. Xxxxxxxx
------------------------------------------
Title: Director, Banc One Capital Markets, Inc.
---------------------------------------
BANK ONE, NA (Main Office Chicago),
as a Bank
By: /s/ X.X. Xxxxxxxx
------------------------------------------
Title: Director, Banc One Capital Xxxxxx, Inc.
---------------------------------------
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxx
------------------------------------------
Title: Senior Vice President
---------------------------------------
M&I XXXXXXXX & ILSLEY BANK
By: /s/ Xxx X. Xxxxxxx
------------------------------------------
Title: Vice President
---------------------------------------
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Title: Vice President
---------------------------------------
ASSOCIATED BANK, N.A.
By: /s/ Xxxx Xxxxxxxxxx
------------------------------------------
Title: Vice President
---------------------------------------
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Schedule 1.1
PRICING SCHEDULE
---------------------- ---------------- --------------- ----------------
Funded Debt
to Total Facility Eurodollar Base
Capitalization Fee Rate Rate Margin Rate Margin
---------------------- ---------------- --------------- ----------------
Level I 0.200% 1.050% 0%
<=.25:1
Level II 0.250% 1.250% 0%
<=.35:1 but >.25:1
Level III 0.300% 1.450% 0%
<=.50:1 but >.35:l
Level IV 0.350% 1.650% 0%
>.50:1
Initially, the Eurodollar Rate Margin, the Base Rate Margin and the
Facility Fee Rate shall be at Level III. The Eurodollar Rate Margin, the Base
Rate Margin and the Facility Fee Rate shall be adjusted, to the extent
applicable, five Business Days after receipt by the Agent of the financial
statements required by Section 6.1 for the most recent fiscal quarter based on
the ratio of Funded Debt to Total Capitalization as of the last day of such
fiscal quarter; provided that if the Company fails to deliver the financial
statements required by Section 6.1 by the 60th day (or, if applicable, the 110th
day) after any fiscal quarter, the Eurodollar Rate Margin, the Base Rate Margin
and the Facility Fee Rate that would apply if the ratio of Funded Debt to Total
Capitalization were greater than .50:1 shall apply until five Business Days
after such financial statements are delivered.
SCHEDULE 2.1
COMMITMENTS
AND PRO RATA SHARES
Bank Commitment Pro Rata Share
Bank One, NA $10,000,000 25%
LaSalle Bank National Association $10,000,000 25%
M&I Xxxxxxxx & Ilsley Bank $10,000,000 25%
Associated Bank, N.A. $10,000,000 25%
SCHEDULE 10.2
EURODOLLAR AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK ONE, NA,
as Agent
Agency Compliance Division
One Bank Xxx Xxxxx
Xxxxx XX0-0000, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
BANK ONE, NA,
as a Bank
Domestic and Eurodollar Lending Office:
Xxx Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing notices and Notices of Conversion/Continuation):
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Managing Director
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
LASALLE BANK NATIONAL ASSOCIATION
Domestic and Eurodollar Lending Office:
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing notices and Notices of Conversion/Continuation):
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
M&I XXXXXXXX & XXXXXX BANK
Domestic and Eurodollar Lending Office:
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx/Xxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing notices and Notices of Conversion/Continuation):
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx/Xxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ASSOCIATED BANK, N.A.
Domestic and Eurodollar Lending Office:
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Borrowing notices and Notices of Conversion/Continuation):
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
EXHIBIT A
NOTICE OF BORROWING
Date: ________________
To: Bank One, NA as Administrative Agent for the Banks parties to the Credit
Agreement dated as of December 28, 2001 (as extended, renewed, amended or
restated from time to time, the "Credit Agreement") among The Marcus
Corporation, certain Banks which are signatories thereto and Bank One, NA, as
Administrative Agent
Ladies and Gentlemen:
The undersigned, The Marcus Corporation (the "Company"), refers to the
Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.3 of the
Credit Agreement, of the Borrowing specified below:
1. The Business Day of the proposed Borrowing is _____________.
2. The aggregate amount of the proposed Borrowing is $____________.
3. The Borrowing is to be comprised of $__________ of [Base Rate]
[Eurodollar Rate] Loans.
4. The duration of the Interest Period for the Eurodollar Rate Loans
included in the Borrowing shall be _____ months.
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the proposed Borrowing,
before and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of the Company
contained in Article V of the Credit Agreement are true and correct as
though made on and as of such date (except to the extent such
representations and warranties relate to an earlier date, in which
case they are true and correct as of such date); and
A-1
(b) no Default or Event of Default has occurred and is
continuing, or would result from such proposed Borrowing.
THE MARCUS CORPORATION
By:
------------------------------------
Title:
---------------------------------
-2-
EXHIBIT B
NOTICE OF CONVERSION/CONTINUATION
Date: __________________
To: Bank One, NA, as Administrative Agent for the Banks parties to the
Credit Agreement dated as of December 28, 2001 (as extended, renewed,
amended or restated from time to time, the "Credit Agreement") among
The Marcus Corporation, certain Banks which are signatories thereto and
Bank One, NA, as Administrative Agent
Ladies and Gentlemen:
The undersigned, The Marcus Corporation (the "Company") refers to the
Credit Agreement, the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.4 of the
Credit Agreement, of the [conversion] [continuation] of the Loans specified
herein, that:
1. The Conversion/Continuation Date is _______________, ____.
2. The aggregate amount of the Loans to be [converted] [continued] is
$_______________.
3. The Loans are to be [converted into] [continued as] [Eurodollar
Rate] [Base Rate] Loans.
4. [If applicable:] The duration of the Interest Period for the Loans
included in the [conversion] [continuation] shall be [____ months].
THE MARCUS CORPORATION
By:
-----------------------------------
Title:
--------------------------------
B-1
EXHIBIT C
THE MARCUS CORPORATION
COMPLIANCE CERTIFICATE
Financial Statement Date: ___________
Reference is made to that certain Credit Agreement dated as of December
28, 2001 (as extended, renewed, amended or restated from time to time, the
"Credit Agreement") among The Marcus Corporation, (the "Company"), the several
financial institutions from time to time parties to this Credit Agreement (the
"Banks") and Bank One, NA, as Administrative Agent for the Banks (in such
capacity, the "Agent"). Unless otherwise defined herein, capitalized terms used
herein have the respective meanings assigned to them in the Credit Agreement.
The undersigned Responsible Officer hereby certifies as of the date
hereof that he/she is the _______________ of the Company, and that, as such,
he/she is authorized to execute and deliver this Certificate to the Banks and
the Agent on the behalf of the Company and its consolidated Subsidiaries, and
that:
1. Enclosed herewith is a copy of the [annual audit/quarterly] report
of the Company as at __________ (the "Computation Date").
2. The undersigned has reviewed and is familiar with the terms of the
Credit Agreement and has made, or has caused to be made under his/her
supervision, a detailed review of the transactions and conditions (financial or
otherwise) of the Company during the accounting period covered by the attached
financial statements.
3. To the best of the undersigned's knowledge, the Company, during
such period, has observed, performed or satisfied all of its covenants and other
agreements, and satisfied every condition in the Credit Agreement to be
observed, performed or satisfied by the Company, and the undersigned has no
knowledge of any Default or Event of Default.
4. The following financial covenant analyses and information set forth
on Schedule 2 attached hereto are true and accurate on and as of the date of
this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ____________________.
THE MARCUS CORPORATION
By:
-----------------------------------
Title:
--------------------------------
C-1
The Marcus Corporation
Compliance Certificate
Schedule 1
Schedule 7.1 - Liens
1. Liens under Section 7.1(e) $_________
2. Liens under Section 7.1(f)
(a) Permitted basket $15,000,000
[(b) Actual outstanding other liens] $_________
Section 7.2 - Disposition of Assets
1. Sales in connection with sale-leaseback transactions
(a) Aggregate Permitted $10,000,000
(b) Actual sale-leaseback transactions $_________
2. Other permitted asset sales
(a) Aggregate permitted annually (10% of consolidated
total assets) $_________
(b) Actual aggregate sales year to date $_________
Section 7.4 - Loans and Investments
1. Loans and Investments to franchisees (limit $10,000,000) $_________
2. Cash Investments to owners of properties or businesses
managed by Company or a Subsidiary (limit $10,000,000) $_________
3. Non-cash Investments to owners of properties or
businesses managed by Company or a Subsidiary
(limit $5,000,000) $_________
4. Other Investments (limit $3,000,000) $_________
Section 7.5 - Limitation on Subsidiary Indebtedness
1. Aggregate secured debt and subsidiary debt.
(a) Indebtedness secured by Liens under Section 7.1(d) $_________
(b) Indebtedness secured by Liens under Section 7.1(e) $_________
(c) Indebtedness secured by Liens under Section 7.1(f) $_________
(d) Subsidiary Indebtedness not included above $_________
(e) Sum of (a) through (d) $_________
-2-
2. Total Permitted
(a) Total Capitalization $_________
(b) 5% of (a) $_________
Section 7.11 - Funded Debt Ratio
1. Actual
(a) Funded Debt $_________
(b) Total Capitalization $_________
(c) Ratio of (a) to (b) ___ to 1.0
2. Maximum Ratio Permitted 0.55 to 1.0
Section 7.12 - Fixed Charge Coverage Ratio
1. Adjusted Consolidated Cash Flow for 12 month period
(a) Consolidated Net Income $_________
(b) depreciation and amortization $_________
(c) taxes $_________
(d) Interest and Rental Expense $_________
(e) Sum of (a) through (d) $_________
2. Ratio of (e) to (d) ___ to 1.0
3. Minimum Ratio Permitted 3.0 to 1.0
-3-
EXHIBIT D
XXXXX X. XXXXX
Attorney at Law
00000 X. Xxxx Xxxxxxxxxx Xxxx - Xxxxx 0
Xxxxxx, Xxxxxxxxx 00000-0000
(000) 000-0000 Fax (000) 000-0000
E-mail: xxxxxxxxx@xxxx.xxx
December 28, 2001
To: Bank One, NA, as Administrative Agent, and the other Banks, parties
from time to time to the Credit Agreement hereinafter referred to
Re: $40,000,000 Credit Agreement dated as of December 28, 2001
between The Marcus Corporation (the "Company"), Bank One,
N.A., as Administrative Agent, and certain other financial
institutions
Gentlemen:
The undersigned has acted as counsel for the Company in connection
with the negotiation, execution and delivery of the Credit Agreement and other
Loan Documents. This opinion letter is delivered pursuant to Section 4.1(d) of
the Credit Agreement. Unless otherwise defined herein or the context otherwise
requires, all capitalized terms used in this opinion letter shall have the
respective meanings assigned to them in the Credit Agreement.
In rendering the opinion set forth herein, I have reviewed the Credit
Agreement and the other Loan Documents. In addition, I have examined originals
or copies, certified or otherwise identified to my satisfaction, of the Articles
of Incorporation and Bylaws of the Company as in effect on the date hereof and
such other documents, records, certificates and instruments as in my judgment
are necessary or appropriate as the basis for the opinions expressed below.
Based upon the foregoing and subject to the qualifications set forth
herein, I am of the opinion that:
1. The Company is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, and
has full corporate power and authority to own and hold under lease its property
and to conduct its business substantially as currently conducted by it. The
Company has full corporate power and authority to obtain the Loans and to enter
into and perform its obligations under each Loan Document.
2. The Company's execution, delivery and performance of the Loan
Documents are within the Company's corporate powers, have been duly authorized
by all necessary corporate action, and do not:
A. contravene the Company's Organization Documents;
B. contravene any Requirement of Law which is applicable to
transactions of the type provided for in the Loan Documents
(a "Relevant Law");
Bank One, NA
December 28, 2001
Page 2
C. to the best of my knowledge contravene any order,
injunction, writ or degree of any court or any other
Governmental Authority (a "Relevant Order");
D. conflict with or result in any breach or contravention of,
or the creation of any Lien under, any document evidencing
any Contractual Obligation to which the Company is a party;
or
E. result in, or require the creation or imposition of, any
Lien on the Company's property under any Relevant Law or
Relevant Order.
3. No authorization or approval or other action by, and no notice to
or filing with, any Governmental Authority is required for the Company's due
execution, delivery or performance of the Loan Documents to which it is a party.
4. The Loan Documents constitute the legal, valid and binding
obligations of the Company, enforceable against the Company in accordance with
their respective terms.
The opinion set forth above is subject to the following qualifications
and limitations:
A. The enforceability of the Loan Documents may be subject to
or limited by bankruptcy, insolvency, reorganization,
arrangement, fraudulent conveyance or transfer, moratorium,
or other similar laws and court decisions, now or hereafter
in effect, relating to or affecting the right of creditors
generally;
B. The enforceability of the Loan Documents is subject to the
application of and may be limited by general principles of
equity; and
C. The remedies of specific performance and injunctive and
other forms of equitable relief are subject to equitable
defenses and to the discretion of the court before which any
proceeding therefor may be brought.
D. This opinion is given as of the date hereof and is intended
to apply only to those facts and circumstances which exist
as of the date hereof. I assume no obligation or
responsibility to update or supplement this opinion to
reflect any facts or circumstances which may hereafter come
to my attention, including any change in law which may
hereafter occur.
E. The opinions herein are limited to the laws of the State of
Illinois, the State of Wisconsin and the federal law of the
United States. I am not a member of the Illinois Bar.
Accordingly, the opinions expressed herein are based on the
assumption that Illinois law is the same as Wisconsin Law in
all respects material to the opinions expressed above.
This opinion letter is rendered solely for your benefit in connection
with the above transaction. Without my prior written consent, this opinion
letter may not be: (i) relied upon by any other party or for any other purpose;
(ii) quoted in whole or in part or otherwise referred to
Bank One, NA
December 28, 2001
Page 3
in any report or document; or (iii) furnished (the original or copies thereof)
to any party except in connection with the enforcement of the Loan Documents;
provided, however, that copies of this opinion letter may be furnished to
regulatory authorities, assignees and participants (actual or potential) in the
Loans and pursuant to the requirements of process.
Very truly yours,
Xxxxx X. Xxxxx
EXHIBIT E
FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of ____________, ____ is made between
______________________________ (the "Assignor") and __________________________
(the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Credit Agreement dated as
of December 28, 2001 (as amended, amended and restated, modified, supplemented
or renewed, the "Credit Agreement") among The Marcus Corporation, (the
"Company"), the several financial institutions from time to time party thereto
(including the Assignor, the "Banks") and Bank One, NA, as administrative agent
for the Banks (the "Agent"). Any terms defined in the Credit Agreement and not
defined in this Assignment and Acceptance, are used herein as defined in the
Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to making Loans (the "Loans") to the Company in an aggregate amount
not to exceed $___________ (the "Commitment");
WHEREAS, [the Assignor has made Loans in the aggregate principal amount
of $__________ to the Company] [no Loans are outstanding under the Credit
Agreement]; and
WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all] rights and obligations of the Assignor under the Credit Agreement in
respect of its Commitment, [together with a corresponding portion of each of its
outstanding Loans,] in an amount equal to $__________ (the "Assigned Amount") on
the terms and subject to the conditions set forth herein and the Assignee wishes
to accept assignment of such rights and to assume such obligations from the
Assignor on such terms and subject to such conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
1. Assignment and Acceptance.
(a) Subject to the terms and conditions of this Assignment and
Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes
from the Assignor, without recourse and without representation or
warranty (except as provided in this Assignment and Acceptance) __% (the
"Assignee's Percentage Share") of (A) the Commitment [and the Loans] of
the Assignor and (B) all related rights, benefits, obligations,
E-1
liabilities and indemnities of the Assignor under and in connection with
the Credit Agreement and the Loan Documents.
[If appropriate, add paragraph specifying payment to Assignor by Assignee
of outstanding principal of, accrued interest on, and fees with respect to,
Loans assigned.]
(b) With effect on and after the Effective Date (as defined in
Section 5 hereof), the Assignee shall be a party to the Credit Agreement
and succeed to all of the rights and be obligated to perform all of the
obligations of a Bank under the Credit Agreement, including the
requirements concerning confidentiality and the payment of
indemnification, with a Commitment in an amount equal to the Assigned
Amount. The Assignee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Agreement
are required to be performed by it as a Bank. It is the intent of the
parties hereto that the Commitment of the Assignor shall, as of the
Effective Date, be reduced by an amount equal to the Assigned Amount and
the Assignor shall relinquish its rights and be released from its
obligations under the Credit Agreement to the extent such obligations
have been assumed by the Assignee; provided, however, the Assignor shall
not relinquish its rights under Sections 10.4 and 10.5 of the Credit
Agreement to the extent such rights relate to the time prior to the
Effective Date.
(c) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignee's Commitment will be
$_________.
(d) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignor's Commitment will be
$_________.
2. Payments.
(a) As consideration for the sale, assignment and transfer
contemplated in Section 1 hereof, the Assignee shall pay to the Assignor
on the Effective Date in immediately available funds an amount equal to
$_______, representing the Assignee's Pro Rata Share of the principal
amount of all Loans.
(b) The [Assignor] [Assignee] further agrees to pay to the Agent a
processing fee in the amount specified in Section 10.8 of the Credit
Agreement.
3. Reallocation of Payments.
Any interest, fees and other payments accrued to the Effective Date with
respect to the Commitment and Loans shall be for the account of the Assignor.
Any interest, fees and other payments accrued on and after the Effective Date
with respect to the Assigned Amount shall be for the account of the Assignee.
Each of the Assignor and the Assignee agrees that it will hold in trust for the
other party any interest, fees and other amounts which it may receive to which
the other party is entitled pursuant to the preceding sentence and pay to the
other party any such amounts which it may receive promptly upon receipt.
-2-
4. Independent Credit Decision.
The Assignee (a) acknowledges that it has received a copy of the Credit
Agreement and the Schedules and Exhibits thereto, together with copies of the
most recent financial statements referred to in Section 6.l of the Credit
Agreement, and such other documents and information as it has deemed appropriate
to make its own credit and legal analysis and decision to enter into this
Assignment and Acceptance; and (b) agrees that it will, independently and
without reliance upon the Assignor, the Agent or any other Bank and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit and legal decisions in taking or not taking
action under the Credit Agreement.
5. Effective Date; Notices.
(a) As between the Assignor and the Assignee, the effective date
for this Assignment and Acceptance shall be __________, _____ (the
"Effective Date"); provided that the following conditions precedent have
been satisfied on or before the Effective Date:
(i) this Assignment and Acceptance shall be executed and
delivered by the Assignor and the Assignee;
(ii) the consent of the Company and the Agent required for
an effective assignment of the Assigned Amount by the Assignor to
the Assignee under Section 10.8 of the Credit Agreement shall have
been duly obtained and shall be in full force and effect as of the
Effective Date;
(iii) the Assignee shall pay to the Assignor all amounts
due to the Assignor under this Assignment, and Acceptance; and
(iv) the processing fee referred to in Section 2(b) hereof
and in Section 10.8 of the Credit Agreement shall have been paid
to the Agent; and
(v) the Assignor shall have assigned and the Assignee shall
have assumed a percentage equal to the Assignee's Percentage Share
of the rights and obligations of the Assignor under the Credit
Agreement (if such agreement exists).
(b) Promptly following the execution of this Assignment and
Acceptance, the Assignor shall deliver to the Company and the Agent for
acknowledgment by the Agent, a Notice of Assignment substantially in the
form attached hereto as Schedule 1.
6. Agent. [INCLUDE ONLY IF ASSIGNOR IS ADMINISTRATIVE AGENT]
(a) The Assignee hereby appoints and authorizes the Assignor to
take such action as agent on its behalf and to exercise such powers under
the Credit Agreement as are delegated to the Agent by the Banks pursuant
to the terms of the Credit Agreement.
-3-
(b) The Assignee shall assume no duties or obligations held by the
Assignor in its capacity as Agent under the Credit Agreement.]
7. Withholding Tax.
The Assignee (a) represents and warrants to the Bank, the Agent and the
Company that under applicable law and treaties no tax will be required to be
withheld by the Bank with respect to any payments to be made to the Assignee
hereunder, (b) agrees to furnish (if it is organized under the laws of any
jurisdiction other than the United States or any State thereof) to the Agent and
the Company prior to the time that the Agent or Company is required to make any
payment of principal, interest or fees hereunder, duplicate executed originals
of either U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue
Service Form 1001 (wherein the Assignee claims entitlement to the benefits of a
tax treaty that provides for a complete exemption from U.S. federal income
withholding tax on all payments hereunder) and agrees to provide new Forms 4224
or 1001 upon the expiration of any previously delivered form or comparable
statements in accordance with applicable U.S. law and regulations and amendments
thereto, duly executed and completed by the Assignee, and (c) agrees to comply
with all applicable U.S. laws and regulations with regard to such withholding
tax exemption.
8. Representations and Warranties.
(a) The Assignor represents and warrants that (i) it is the legal
and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any Lien or other adverse claim;
(ii) it is duly organized and existing and it has the full power and
authority to take, and has taken, all action necessary to execute and
deliver this Assignment and Acceptance and any other documents required
or permitted to be executed or delivered by it in connection with this
Assignment and Acceptance and to fulfill its obligations hereunder; (iii)
no notices to, or consents, authorizations or approvals of, any Person
are required (other than any already given or obtained) for its due
execution, delivery and performance of this Assignment and Acceptance,
and apart from any agreements or undertakings or filings required by the
Credit Agreement, no further action by, or notice to, or filing with, any
Person is required of it for such execution, delivery or performance; and
(iv) this Assignment and Acceptance has been duly executed and delivered
by it and constitutes the legal, valid and binding obligation of the
Assignor, enforceable against the Assignor in accordance with the terms
hereof, subject, as to enforcement, to bankruptcy, insolvency,
moratorium, reorganization and other laws of general application relating
to or affecting creditors' rights and to general equitable principles.
(b) The Assignor makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement or any other instrument or document
furnished pursuant thereto. The Assignor makes no representation or
warranty in connection with, and assumes no responsibility with
-4-
respect to, the solvency, financial condition or statements of the
Company, or the performance or observance by the Company, of any of its
respective obligations under the Credit Agreement or any other instrument
or document furnished in connection therewith.
(c) The Assignee represents and warrants that (i) it is duly
organized and existing and it has full power and authority to take, and
has taken, all action necessary to execute and deliver this Assignment
and Acceptance and any other documents required or permitted to be
executed or delivered by it in connection with this Assignment and
Acceptance, and to fulfill its obligations hereunder; (ii) no notices to,
or consents, authorizations or approvals of, any Person are required
(other than any already given or obtained) for its due execution,
delivery and performance of this Assignment and Acceptance; and apart
from any agreements or undertakings or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person
is required of it for such execution, delivery or performance; (iii) this
Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignee,
enforceable against the Assignee in accordance with the terms hereof,
subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or
affecting creditors' rights and to general equitable principles; and (iv)
it is an Eligible Assignee.
9. Further Assurances.
The Assignor and the Assignee each hereby agree to execute and deliver
such other instruments, and take such other action, as either party may
reasonably request in connection with the transactions contemplated by this
Assignment and Acceptance, including the delivery of any notices or other
documents or instruments to the Company or the Agent, which may be required in
connection with the assignment and assumption contemplated hereby.
10. Miscellaneous.
(a) Any amendment or waiver of any provision of this Assignment
and Acceptance shall be in writing and signed by the parties hereto. No
failure or delay by either party hereto in exercising any right, power or
privilege hereunder shall operate as a waiver thereof and any waiver of
any breach of the provisions of this Assignment and Acceptance shall be
without prejudice to any rights with respect to any other or further
breach thereof.
(b) All payments made hereunder shall be made without any set-off
or counterclaim.
(c) The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation,
execution and performance of this Assignment and Acceptance.
-5-
(d) This Assignment and Acceptance may be executed in any number
of counterparts and all of such counterparts taken together shall be
deemed to constitute one and the same instrument.
(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF ILLINOIS. The
Assignor and the Assignee each irrevocably submits to the non-exclusive
jurisdiction of any State or Federal court sitting in Illinois over any
suit, action or proceeding arising out of or relating to this Assignment
and Acceptance and irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such Illinois State
or Federal court. Each party to this Assignment and Acceptance hereby
irrevocably waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding.
(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH THIS ASSIGNMENT AND ACCEPTANCE, THE CREDIT
AGREEMENT, ANY RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, OR STATEMENTS (WHETHER ORAL OR WRITTEN).
[Other provisions to be added as may be negotiated between the Assignor
and the Assignee, provided that such provisions are not inconsistent with the
Credit Agreement.]
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
[ASSIGNOR]
By:
---------------------------------------
Title:
------------------------------------
[ASSIGNEE]
By:
---------------------------------------
Title:
------------------------------------
-6-
SCHEDULE 1
NOTICE OF ASSIGNMENT AND ACCEPTANCE
----------------, ----
Bank One, NA, as
Administrative Agent
Xxx Xxxx Xxx Xxxxx
Xxxxxxx, XX 00000
The Marcus Corporation
Suite 1700
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
We refer to the Credit Agreement dated as of December 28, 2001 (as
amended, amended and restated, modified, supplemented or renewed from time to
time the "Credit Agreement") among The Marcus Corporation (the "Company") the
Banks referred to therein and Bank One, NA as administrative agent for the Banks
(the "Agent"). Terms defined in the Credit Agreement are used herein as therein
defined.
1. We hereby give you notice of, and request your consent to, the
assignment by __________________ (the "Assignor") to _______________ (the
"Assignee") of _____% of the right, title and interest of the Assignor in and to
the Credit Agreement (including, without limitation, the right, title and
interest of the Assignor in and to the Commitments of the Assignor,] [and] all
outstanding Loans made by the Assignor pursuant to the Assignment and Acceptance
Agreement attached hereto (the "Assignment and Acceptance"). Before giving
effect to such assignment the Assignor's Commitment is $ __________ [,] [and]
the aggregate amount of its outstanding Loans is $_____________.
2. The Assignee agrees that, upon receiving the consent of the Agent and,
if applicable, The Marcus Corporation to such assignment, the Assignee will be
bound by the terms of the Credit Agreement as fully and to the same extent as if
the Assignee were the Bank originally holding such interest in the Credit
Agreement.
3. The following administrative details apply to the Assignee:
(A) Notice Address:
Assignee name:
------------------------------------
Address:
------------------------------------
Attention:
-----------------------------------
Telephone: ( )
-----------------------------------
Telecopier: ( )
-----------------------------------
(B) Payment Instructions:
Account No.
-----------------------------------
At:
-----------------------------------
Reference:
-----------------------------------
Attention:
-----------------------------------
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
-2-
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
[NAME OF ASSIGNOR]
By:
-----------------------------------
Title:
--------------------------------
[NAME OF ASSIGNEE]
By:
-----------------------------------
Title:
--------------------------------
ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:
THE MARCUS CORPORATION
By:
----------------------------------
Title:
-------------------------------
BANK ONE, NA,
as Administrative Agent
By:
----------------------------------
Title:
-------------------------------
-3-
EXHIBIT F
[FORM OF PROMISSORY NOTE
$
-------------- ---------------, ----
FOR VALUE RECEIVED, the undersigned, The Marcus Corporation, (the
"Company"), hereby promises to pay to the order of __________________ (the
"Bank") the principal sum of _________ Dollars ($___________) or, if less, the
aggregate unpaid principal amount of all Loans made by the Bank to the Company
pursuant to the Credit Agreement, dated as of December 28, 2001 (such Credit
Agreement, as it may be amended, restated, supplemented or otherwise modified
from time to time, being hereinafter called the "Credit Agreement"), among the
Company, the Bank, the other banks parties thereto and Bank One, NA, as
Administrative Agent on the dates and in the amounts provided in the Credit
Agreement. The Company further promises to pay interest on the unpaid principal
amount of the Loans evidenced hereby from time to time at the rates, on the
dates, and otherwise as provided in the Credit Agreement.
The Bank is authorized to endorse the amount and the date on which each
Loan is made, the maturity date therefor and each payment of principal with
respect thereto on the schedules annexed hereto and made a part hereof, or on
continuations thereof which shall be attached hereto and made a part hereof;
provided, that any failure to endorse such information on such schedule or
continuation thereof shall not in any manner affect any obligation of the
Company under the Credit Agreement and this Promissory Note (the "Note").
This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Credit Agreement, which Credit Agreement, among other things,
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein specified.
Terms defined in the Credit Agreement are used herein with their defined
meanings therein unless otherwise defined herein. This Note shall be governed
by, and construed and interpreted in accordance with, the laws of the State of
Illinois applicable to contracts made and to be performed entirely within such
State.
THE MARCUS CORPORATION
By:
--------------------------------
Title:
-----------------------------
F-1
Schedule A to Note
BASE RATE LOANS AND REPAYMENT OF BASE RATE LOANS
(2)
Amount (3) (4) (5)
Of Maturity Date Amount of Base Notation
(1) Base Rate of Base Rate Rate Loan Made
Date Loan Loan Repaid By
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Schedule B to Note
EURODOLLAR RATE LOANS AND REPAYMENT OF EURODOLLAR RATE LOANS
(2)
Amount (4)
Of (3) Amount of (5)
Eurodollar Maturity Date Eurodollar Notation
(1) Rate of Eurodollar Rate Loan Made
Date Loan Rate Loan Repaid By
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