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EXHIBIT 10.1
[EXECUTION COPY]
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$200,000,000
SECOND AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
Dated as of March 6, 2000
Between
XXXXXXX TIRE GROUP, INC.
WINSTON TIRE COMPANY
THE SPEED MERCHANT, INC.
CALIFORNIA TIRE COMPANY
(the Borrowers)
and
THE FINANCIAL INSTITUTIONS PARTY
HERETO FROM TIME TO TIME
(the Lenders)
and
FLEET CAPITAL CORPORATION
(the Administrative Agent)
and
BANK OF AMERICA, N.A.
(the Syndication Agent)
and
FIRST UNION NATIONAL BANK
(the Documentation Agent)
FLEETBOSTON XXXXXXXXX XXXXXXXX INC.
(the Arranger)
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TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS...........................................................1
SECTION 1.1 Definitions.....................................................1
SECTION 1.2 General Interpretive Rules.....................................30
SECTION 1.3 Exhibits and Schedules.........................................32
ARTICLE 2 COMMITMENTS..........................................................33
SECTION 2.1 Loans..........................................................33
SECTION 2.2 Manner of Borrowing............................................33
SECTION 2.3 Repayment......................................................35
SECTION 2.4 Notes..........................................................36
SECTION 2.5 Extension of Commitments.......................................36
ARTICLE 2A SWINGLINE FACILITY...................................................37
SECTION 2A.1 Swingline Loans................................................37
SECTION 2A.2 Making Swingline Loans.........................................37
SECTION 2A.3 Repayment of Swingline Loans...................................37
SECTION 2A.4 Prepayment.....................................................37
SECTION 2A.5 Swingline Note.................................................38
SECTION 2A.6 Extension of Commitments.......................................38
ARTICLE 3 LETTER OF CREDIT FACILITY............................................39
SECTION 3.1 Agreement to Issue.............................................39
SECTION 3.2 Amounts........................................................39
SECTION 3.3 Conditions.....................................................39
SECTION 3.4 Issuance of Letter of Credit Guarantees........................40
SECTION 3.5 Duties of FCC..................................................40
SECTION 3.6 Payment of Reimbursement Obligations...........................41
SECTION 3.7 Participations.................................................41
SECTION 3.8 Indemnification, Exoneration...................................43
SECTION 3.9 Supporting Letter of Credit; Cash Collateral Account...........44
ARTICLE 4 GENERAL LOAN PROVISIONS..............................................46
SECTION 4.1 Interest.......................................................46
SECTION 4.2 Certain Fees...................................................47
SECTION 4.3 Manner of Payment..............................................49
SECTION 4.4 General........................................................49
SECTION 4.5 Loan Accounts; Statements of Account...........................49
SECTION 4.6 Reduction of Commitments; Termination of Agreement.............50
SECTION 4.7 Making of Loans................................................51
SECTION 4.8 Settlement Among Lenders.......................................52
SECTION 4.9 Mandatory Prepayments..........................................55
SECTION 4.10 Payments Not at End of Interest Period; Failure to Borrow......55
SECTION 4.11 Notice of Conversion or Continuation...........................56
SECTION 4.12 Conversion or Continuation.....................................56
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SECTION 4.13 Duration of Interest Periods; Maximum Number of Eurodollar
Rate Loans; Minimum Increments................................56
SECTION 4.14 Changed Circumstances..........................................57
SECTION 4.15 Cash Collateral Account; Investment Accounts...................58
SECTION 4.16 Allocation of Payments from Borrowers..........................59
SECTION 4.17 Borrowers' Representative......................................60
SECTION 4.18 Joint and Several Liability....................................60
SECTION 4.19 Obligations Absolute...........................................61
SECTION 4.20 Waiver of Suretyship Defenses..................................61
ARTICLE 5 CONDITIONS PRECEDENT.................................................63
SECTION 5.1 Conditions Precedent to Effectiveness of Agreement.............63
SECTION 5.2 All Loans; Letters of Credit...................................65
SECTION 5.3 Conditions as Covenants........................................66
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF BORROWERS..........................67
SECTION 6.1 Representations and Warranties.................................67
SECTION 6.2 Survival of Representations and Warranties, Etc................74
ARTICLE 7 SECURITY INTEREST....................................................75
SECTION 7.1 Security Interest..............................................75
SECTION 7.2 Continued Priority of Security Interest........................76
ARTICLE 8 COLLATERAL COVENANTS.................................................78
SECTION 8.1 Collection of Receivables......................................78
SECTION 8.2 Verification and Notification..................................79
SECTION 8.3 Disputes, Returns and Adjustments..............................79
SECTION 8.4 Invoices.......................................................80
SECTION 8.5 Delivery of Instruments........................................80
SECTION 8.6 Sales of Inventory.............................................81
SECTION 8.7 Ownership and Defense of Title.................................81
SECTION 8.8 Insurance......................................................81
SECTION 8.9 Location of Offices and Collateral.............................82
SECTION 8.10 Records Relating to Collateral.................................82
SECTION 8.11 Inspection.....................................................83
SECTION 8.12 Information and Reports........................................83
SECTION 8.13 Power of Attorney..............................................84
SECTION 8.14 Assignment of Claims Act.......................................84
ARTICLE 9 AFFIRMATIVE COVENANTS................................................85
SECTION 9.1 Preservation of Corporate Existence and Similar Matters........85
SECTION 9.2 Compliance with Applicable Law.................................85
SECTION 9.3 Maintenance of Property........................................85
SECTION 9.4 Conduct of Business............................................85
SECTION 9.5 Insurance......................................................86
SECTION 9.6 Payment of Taxes and Claims....................................86
SECTION 9.7 Accounting Methods and Financial Records.......................86
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SECTION 9.8 Use of Proceeds................................................86
SECTION 9.9 Hazardous Waste and Substances; Environmental Requirements.....87
SECTION 9.10 Additional Subsidiaries........................................87
SECTION 9.11 Compliance with Senior Note Indenture..........................87
SECTION 9.12 Agency Account Agreements......................................87
ARTICLE 10 INFORMATION..........................................................88
SECTION 10.1 Financial Statements...........................................88
SECTION 10.2 Accountants' Certificate.......................................89
SECTION 10.3 Officer's Certificate..........................................89
SECTION 10.4 Copies of Other Reports........................................89
SECTION 10.5 Notice of Litigation and Other Matters.........................90
SECTION 10.6 ERISA..........................................................90
ARTICLE 11 NEGATIVE COVENANTS...................................................92
SECTION 11.1 Financial Covenant.............................................92
SECTION 11.2 Debt...........................................................92
SECTION 11.3 Guarantees.....................................................93
SECTION 11.4 Acquisitions...................................................93
SECTION 11.5 Capital Expenditures...........................................95
SECTION 11.6 Restricted Distributions and Payments, Etc.....................95
SECTION 11.7 Merger, Consolidation and Sale of Assets.......................95
SECTION 11.8 Transactions with Affiliates...................................95
SECTION 11.9 Liens..........................................................95
SECTION 11.10 Sales and Leasebacks...........................................95
SECTION 11.11 Amendments of Other Agreements.................................95
SECTION 11.12 Commingling....................................................96
ARTICLE 12 DEFAULT..............................................................97
SECTION 12.1 Events of Default..............................................97
SECTION 12.2 Remedies......................................................100
SECTION 12.3 Application of Proceeds.......................................102
SECTION 12.4 Power of Attorney.............................................102
SECTION 12.5 Miscellaneous Provisions Concerning Remedies..................103
SECTION 12.6 Trademark License.............................................104
ARTICLE 13 ASSIGNMENTS.........................................................105
SECTION 13.1 Successors and Assigns; Participations........................105
SECTION 13.2 Representation of Lenders.....................................107
ARTICLE 14 AGENT...............................................................108
SECTION 14.1 Appointment of Agent..........................................108
SECTION 14.2 Delegation of Duties..........................................108
SECTION 14.3 Exculpatory Provisions........................................108
SECTION 14.4 Reliance by Agent.............................................109
SECTION 14.5 Notice of Default.............................................109
SECTION 14.6 Non-Reliance on Agent and Other Lenders.......................109
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SECTION 14.7 Indemnification...............................................110
SECTION 14.8 Agent in Its Individual Capacity..............................111
SECTION 14.9 Successor Collateral Agent....................................112
SECTION 14.10 Notices from Agent to Lenders.................................113
SECTION 14.11 Declaring Events of Default...................................113
SECTION 14.12 Syndication Agent and Documentation Agent.....................113
ARTICLE 15 MISCELLANEOUS.......................................................114
SECTION 15.1 Notices.......................................................114
SECTION 15.2 Expenses......................................................115
SECTION 15.3 Stamp and Other Taxes.........................................116
SECTION 15.4 Setoff........................................................116
SECTION 15.5 Consent to Advertising and Publicity..........................117
SECTION 15.6 Reversal of Payments..........................................117
SECTION 15.7 Injunctive Relief.............................................117
SECTION 15.8 Accounting Matters............................................117
SECTION 15.9 Amendments....................................................118
SECTION 15.10 Assignment....................................................119
SECTION 15.11 Performance of Borrowers' Duties..............................119
SECTION 15.12 Indemnification...............................................120
SECTION 15.13 All Powers Coupled with Interest..............................120
SECTION 15.14 Survival......................................................120
SECTION 15.15 Titles and Captions...........................................121
SECTION 15.16 Severability of Provisions....................................121
SECTION 15.17 Governing Law.................................................121
SECTION 15.18 Counterparts..................................................122
SECTION 15.19 Reproduction of Documents.....................................122
SECTION 15.20 Term of Agreement.............................................122
SECTION 15.21 Increased Capital.............................................122
SECTION 15.22 Pro-Rata Participation........................................123
SECTION 15.23 Net Payments..................................................124
SECTION 15.24 Effect on Effectiveness of this Agreement.....................126
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ANNEX A COMMITMENTS
ANNEX B PRICING MATRIX
EXHIBIT A-1 FORM OF SECOND AMENDED AND RESTATED PROMISSORY NOTE
EXHIBIT A-2 FORM OF SWINGLINE NOTE
EXHIBIT B FORM OF BORROWING BASE CERTIFICATE
EXHIBIT C FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT D FORM OF COMPLIANCE CERTIFICATE
EXHIBIT E FORM OF SUBSIDIARY GUARANTY
EXHIBIT F FORM OF SUBSIDIARY SECURITY AGREEMENT
Schedule 1.1A Permitted Investments
Schedule 1.1B Permitted Liens
Schedule 1.1C Clearing Banks
Schedule 6.1(a) Jurisdictions in Which Borrowers are Qualified as
Foreign Corporations
Schedule 6.1(b) Capitalization
Schedule 6.1(c) Subsidiaries; Ownership of Stock
Schedule 6.1(e) Compliance with Laws
Schedule 6.1(f) Business of Borrowers
Schedule 6.1(g) Governmental Approvals
Schedule 6.1(h) Title to Properties
Schedule 6.1(i) Liens
Schedule 6.1(j) Indebtedness and Guarantees
Schedule 6.1(k) Litigation
Schedule 6.1(l) Tax Matters
Schedule 6.1(m) Burdensome Provisions
Schedule 6.1(n) Undisclosed Material Obligations
Schedule 6.1(p) ERISA
Schedule 6.1(t) Location of Offices and Receivables
Schedule 6.1(u) Location of Inventory and Equipment
Schedule 6.1(v) Corporate and Fictitious Names
Schedule 6.1(y) Employee Relations
Schedule 6.1(aa) Trade Names
Schedule 6.1(bb) Bank Accounts
Schedule 6.1(dd) Real Property
Schedule 11.8 Affiliate Transactions
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SECOND AMENDED AND RESTATED
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
is made as of March 6, 2000 by and between XXXXXXX TIRE GROUP, INC., WINSTON
TIRE COMPANY, THE SPEED MERCHANT, INC., CALIFORNIA TIRE COMPANY, the financial
institutions party to this Agreement from time to time as the Lenders, FIRST
UNION NATIONAL BANK, as documentation agent, BANK OF AMERICA, N.A., as
syndication agent, and FLEET CAPITAL CORPORATION, as administrative agent for
the Lenders.
PRELIMINARY STATEMENT
Xxxxxxx Tire Group, Inc., Winston Tire Company, The Speed
Merchant, Inc., and Fleet Capital Corporation and First Union National Bank and,
by assignment from Fleet Capital Corporation and First Union National Bank (the
"Existing Lenders"), Bank of America, N.A., Mellon Bank, N.A. and PNC Bank,
National Association (the "New Lenders"), are parties to an Amended and Restated
Loan and Security Agreement dated as of May 20, 1998 (as amended to date, the
"Existing Loan Agreement").
At the request of Xxxxxxx Tire Group, Inc., the parties to the
Existing Loan Agreement have agreed to increase the amount available to be
borrowed on a revolving credit basis, add California Tire Company as a Borrower,
modify certain covenants and make other changes to the Existing Loan Agreement,
and for the convenience of the parties, to effect such increase, additions,
modifications and other changes by amending and restating the Existing Loan
Agreement in its entirety as hereinafter set forth, upon and subject to all of
the terms, conditions and provisions hereof. This amendment and restatement is
not intended to be, and shall not be deemed or construed as, a repayment or
novation of the Debt outstanding under the Existing Loan Agreement.
Accordingly, in consideration of the Existing Loan Agreement,
the financial accommodations outstanding thereunder, the mutual promises
hereinafter set forth and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. For the purposes of this Agreement:
"ACH Transfer" means and refers to the transfer of funds
within or between financial institutions using electronic credits and debits in
accordance with banking procedures promulgated by the National Automated
Clearing House Association or any related regional association.
"Account Debtor" means a Person who is obligated on a
Receivable.
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"Acquire" or "Acquisition", as applied to any Business Unit or
Investment, means the acquisition of such Business Unit or Investment by
purchase, exchange, issuance of stock or other securities, or by merger,
reorganization or any other method.
"Acquired Debt" means Debt of a Person that becomes a
Consolidated Subsidiary after the Effective Date or is otherwise Acquired by a
Loan Party after the Effective Date and Debt secured by property included in a
Business Unit Acquired by a Loan Party after the Effective Date, which Debt was
outstanding immediately prior to such Acquisition but was not incurred or
created in contemplation of such Acquisition.
"Additional Reserves" means reserves other than the Letter of
Credit Reserve, the Rent Reserve or the Dilution Reserve against the Borrowing
Base established by the Administrative Agent from time to time in the exercise
of its reasonable credit judgment.
"Administrative Agent" means FCC and any successor agent
appointed pursuant to SECTION 14.9 hereof.
"Administrative Agent's Office" means the office of the
Administrative Agent specified in or determined in accordance with the
provisions of SECTION 15.1.
"Affiliate" (and with corollary meaning, "Affiliated") means,
with respect to a Person, (a) any partner, officer, shareholder (if holding more
than ten percent (10%) of the outstanding shares of capital stock of such
Person), member, director, manager or managing agent of such Person, (b) any
spouse, parents, siblings, children or grandchildren of such Person, and (c) any
other Person (other than a Subsidiary) that, (i) directly or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, such given Person, (ii) directly or indirectly beneficially owns
or holds ten percent (10%) or more of any class of voting stock or partnership
or other voting interest of such Person or any Subsidiary of such Person, or
(iii) ten percent (10%) or more of the voting stock or partnership or other
voting interest of which is directly or indirectly beneficially owned or held by
such Person or a Subsidiary of such Person. The term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities or partnership or other voting interest, by contract or
otherwise. So long as it is not a holder, beneficially or of record, of issued
and outstanding shares of common stock of Xxxxxxx or otherwise in control of
Xxxxxxx, The 1818 Mezzanine Fund, L.P. will not be deemed to be an Affiliate of
Xxxxxxx by reason of its holding the Warrant.
"Agency Account" means an account of a Loan Party maintained
by it with a Clearing Bank pursuant to an Agency Account Agreement.
"Agency Account Agreement" means an agreement among a Loan
Party, the Administrative Agent and a Clearing Bank, in form and substance
satisfactory to the Administrative Agent, concerning the collection and transfer
of payments which represent the proceeds of Receivables or of any other
Collateral.
"Agreement" means and includes this Second Amended and
Restated Loan and Security Agreement, including all Schedules, Exhibits and
other attachments hereto, and all
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amendments, modifications and supplements hereto and thereto and restatements
hereof and thereof.
"Agreement Date" means the date as of which this Agreement is
dated.
"Applicable Law" means all applicable provisions of
constitutions, statutes, rules, regulations and orders of all governmental
bodies and of all orders and decrees of all courts and arbitrators, including,
without limitation, Environmental Laws.
"Applicable Margin" means (a) as to Base Rate Revolving Credit
Loans, 0.25%, and (b) as to Eurodollar Rate Revolving Credit Loans, 1.75%,
subject to quarterly adjustment as follows: From and after the delivery of the
consolidated quarterly financial statements of Xxxxxxx and its Consolidated
Subsidiaries for the Fiscal Quarter ending on or about June 30, 2000 and each
Fiscal Quarter ending thereafter and the related officer's certificate in
accordance with the respective provisions of SECTIONS 10.1(B) and 10.3, the
foregoing percentages will be adjusted, PROVIDED that no Default or Event of
Default has occurred and is continuing, effective the first day of the calendar
month that begins at least 10 days after delivery of such financial statements
for such Fiscal Quarter or any succeeding Fiscal Quarter, to the percentages set
forth in ANNEX B that correspond to the Interest Coverage Ratio reflected in
such financial statements and the related certificate.
"Assignment and Acceptance" means an assignment and acceptance
in the form attached hereto as EXHIBIT C assigning all or a portion of a
Lender's interests, rights and obligations under this Agreement pursuant to
SECTION 13.1.
"Attributable Debt" in respect of a sale leaseback transaction
means, as at the date of determination, the present value (discounted at the
interest rate borne by the Senior Notes, compounded annually) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in such sale leaseback transaction (including any period for
which such lease has been extended).
"Bank" means Fleet National Bank, a national banking
association.
"BankBoston" means BankBoston, N.A., a national banking
association.
"Bank of America" means Bank of America, N.A., a national
banking association.
"Base Rate" means at any time a fluctuating interest rate per
annum equal to the greater of (i) the rate of interest announced or quoted from
time to time by Bank as its prime rate for commercial loans, which rate might
not be the lowest rate charged by Bank, and, if such prime rate for commercial
loans is discontinued by Bank as a standard, a comparable reference rate
designated by Bank as a substitute therefor shall be the Base Rate, and (ii) the
Federal Funds Rate plus 1/2 of 1% per annum.
"Base Rate Loan" means each Borrowing of Loans bearing
interest determined with reference to the Base Rate on the same day and a
specified principal amount of such Loans outstanding and any Non-Ratable Loan.
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"Base Rate Revolving Credit Loan" means each Base Rate Loan
outstanding under the Revolving Credit Facility.
"Benefit Plan" means an "employee pension benefit plan" as
defined in Section 3(3) of ERISA (other than a Multiemployer Plan) in respect of
which a Borrower or any Related Company is, or within the immediately preceding
six years was, an "employer" as defined in Section 3(5) of ERISA, including such
plans as may be established after the Agreement Date.
"Borrower" means each of Xxxxxxx, Xxxxxxx, CPW and Cal Tire.
"Borrowing" means Loans of the same Type hereunder made (or
continued or converted) by the Lenders Ratably on the same date, and, in the
case of Eurodollar Rate Loans, for the same Interest Period.
"Borrowing Base" means at any time an amount equal to the
lesser of:
(a) the aggregate Commitments, MINUS the sum of
(i) the Letter of Credit Reserve, PLUS
(ii) the Rent Reserve, PLUS
(iii) any Additional Reserves, and
(b) an amount equal to
(i) 85% (or such lesser percentage as the
Administrative Agent may in its reasonable credit judgment
determine from time to time) of the face value of Eligible
Receivables due and owing at such time, PLUS
(ii) 65% as to Inventory consisting of tires and 50%
as to all other Inventory (or in either case, such lesser
percentage as the Administrative Agent may in its reasonable
credit judgment determine from time to time) of the lesser of
cost determined on a FIFO (or first-in-first-out) accounting
basis and fair market value of applicable Eligible Inventory,
at such time, MINUS
(iii) the sum of
(A) the Letter of Credit Reserve, PLUS
(B) the Rent Reserve, PLUS
(C) the Dilution Reserve, PLUS
(D) any Additional Reserves.
"Borrowing Base Certificate" means a certificate in the form
attached hereto as EXHIBIT B or in such other form as the Borrowers and the
Administrative Agent may agree.
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"Business Day" means any day other than a Saturday, Sunday or
other day on which banks in Atlanta, Georgia, Boston, Massachusetts or Hartford,
Connecticut are authorized to close and, when used with respect to Eurodollar
Rate Loans, means any such day on which dealings in Dollar deposits are carried
on in the London interbank market.
"Business Unit" means assets constituting a business, whether
all of the assets of any Person or the assets of a division or operating unit of
any Person.
"CPW" means The Speed Merchant, Inc., a California
corporation, doing business as "The Speed Merchant" and as "Competition Parts
Warehouse" and a Wholly Owned Subsidiary of Xxxxxxx.
"Cal Tire" means California Tire Company, a California
corporation and a Wholly Owned Subsidiary of Xxxxxxx.
"Capital Expenditures" means, with respect to any Person, all
expenditures made and liabilities incurred for the acquisition of assets (other
than Inventory or assets that constitute a Business Unit) which are not, in
accordance with GAAP, treated as expense items for such Person in the year made
or incurred or as a prepaid expense applicable to a future year or years.
"Capitalized Lease" means a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP.
"Capitalized Lease Obligation" means Indebtedness represented
by obligations under a Capitalized Lease, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Cash Collateral" means collateral consisting of cash or Cash
Equivalents on which the Administrative Agent, for the benefit of itself as
Administrative Agent and the Lenders, has a first priority Lien.
"Cash Collateral Account" means a special interest-bearing
deposit account consisting of cash maintained by the Administrative Agent in the
name of Xxxxxxx but under the sole dominion and control of the Administrative
Agent, for its benefit and for the benefit of the Lenders, established pursuant
to the provisions of SECTION 4.15(A) for purposes set forth therein.
"Cash Equivalents" means
(a) marketable direct obligations issued or unconditionally
guaranteed by the United States Government or issued by any agency thereof and
backed by the full faith and credit of the United States, in each case maturing
within one year from the date of acquisition thereof;
(b) commercial paper maturing no more than one year from the
date issued and, at the time of acquisition thereof, rated at least A-1 by S&P
or at least P-1 by Xxxxx'x;
(c) certificates of deposit or bankers' acceptances issued in
Dollar denominations and maturing within one year from the date of issuance
thereof issued by any commercial bank organized under the laws of the United
States of America or any state thereof
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or the District of Columbia having combined capital and surplus of not less than
$100,000,000 and, unless issued by a Lender, not subject to set-off or offset
rights in favor of such bank arising from any banking relationship with such
bank;
(d) units or other interests in funds invested solely in
instruments described in CLAUSES (A), (B) and (C); and
(e) repurchase agreements in form and substance and for
amounts satisfactory to the Administrative Agent.
"Clearing Bank" means each bank listed on SCHEDULE 1.1C -
CLEARING BANKS and any other banking institution with which an Agency Account
has been established pursuant to an Agency Account Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Collateral" means and includes all of each Loan Party's
right, title and interest in and to each of the following, wherever located and
whether now or hereafter existing or now owned or hereafter acquired or arising:
(a) (i) all rights to the payment of money or other forms of
consideration of any kind (whether classified under the UCC as accounts,
contract rights, chattel paper, general intangibles or otherwise) including, but
not limited to, accounts receivable, insurance proceeds, letters of credit and
the right to receive payment thereunder, chattel paper, any rights under
contracts not yet earned by performance and not evidenced by an instrument or
chattel paper, notes, drafts, instruments, documents, acceptances and all other
debts, obligations and liabilities in whatever form from any Person, but
excluding tax refunds and insurance proceeds not arising out of the Collateral,
(ii) all guarantees, security and Liens securing payment thereof, (iii) all
goods, whether now owned or hereafter acquired, and whether sold, delivered,
undelivered, in transit or returned, which may be represented by, or the sale or
lease of which may have given rise to, any such right to payment or other debt,
obligation or liability, and (iv) all proceeds of any of the foregoing (the
foregoing, collectively, "Receivables"),
(b) (i) all inventory, (ii) all goods intended for sale or
lease or for display or demonstration, (iii) all work in process, (iv) all raw
materials and other materials and supplies of every nature and description used
or which might be used in connection with the manufacture, packing, shipping,
advertising, selling, leasing or furnishing of goods or services or otherwise
used or consumed in the conduct of business, and (v) all documents of title,
including bills of lading and warehouse receipts, and other documents evidencing
and general intangibles relating to any of the foregoing (the foregoing,
collectively, "Inventory"),
(c) any demand, time, savings, passbook, money market or like
depository account, and all certificates of deposit, maintained with a bank,
savings and loan association, credit union or like organization (other than an
account evidenced by a certificate of deposit that is an instrument under the
UCC) to which proceeds of Collateral are deposited (the foregoing, collectively,
"Deposit Accounts"),
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(d) all certificated and uncertificated securities, all
security entitlements, all securities accounts, all commodity contracts and all
commodity accounts (EXCLUDING, HOWEVER, the equity securities of any
Subsidiary), to the extent acquired directly with proceeds of Collateral (the
foregoing, collectively, "Investment Property"),
(e) (i) any investment account maintained by or on behalf of a
Loan Party with the Administrative Agent or any Lender or any Affiliate of the
Administrative Agent or any Lender, (ii) any agreement governing such account,
(iii) all cash proceeds and Investment Property now or hereafter held by the
Administrative Agent or any Lender or any Affiliate of the Administrative Agent
or any Lender on behalf of a Loan Party in connection with such investment
account and (iv) all documents evidencing and general intangibles related to the
foregoing (the foregoing, collectively, "Investment Accounts"),
(f) all cash or other property deposited with the
Administrative Agent or any Lender or any Affiliate of the Administrative Agent
or any Lender or which the Administrative Agent, for its benefit and for the
benefit of the Lenders, or any Lender or such Affiliate is entitled to retain or
otherwise possess as collateral pursuant to the provisions of this Agreement or
any of the Loan Documents or any agreement relating to any Letter of Credit,
including, without limitation, amounts on deposit in the Cash Collateral
Account,
(g) all goods and other property, whether or not delivered,
(i) the sale or lease of which gives or purports to give rise to any Receivable,
including, but not limited to, all merchandise returned or rejected by or
repossessed from customers, or (ii) securing any Receivable, including, without
limitation, all rights as an unpaid vendor or lienor (including, without
limitation, stoppage in transit, replevin and reclamation) with respect to such
goods and other properties,
(h) all mortgages, deeds to secure debt and deeds of trust on
real or personal property, guarantees, leases, security agreements and other
agreements and property which secure or relate to any Receivable or other
Collateral or are acquired for the purpose of securing and enforcing any item
thereof,
(i) all files, correspondence, computer programs, tapes, disks
and related data processing software which contain information identifying or
pertaining to any of the Collateral or any Account Debtor or showing the amounts
thereof or payments thereon or otherwise necessary or helpful in the realization
thereon or the collection thereof, and
(j) any and all products and cash and non-cash proceeds of the
foregoing (including, but not limited to, any claims to any items referred to in
this definition and any claims against third parties for loss of, damage to or
destruction of any or all of the Collateral or for proceeds payable under or
unearned premiums with respect to policies of insurance) in whatever form,
including, but not limited to, cash, negotiable instruments and other
instruments for the payment of money, chattel paper, security agreements and
other documents.
"Collateral Availability" means at any time the excess, if
any, of the amount determined pursuant to CLAUSE (B) of the definition
"Borrowing Base" over the aggregate principal amount of Revolving Credit Loans
and Swingline Loans outstanding at such time.
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"Commitment" means, as to each Lender, the amount set forth
opposite such Lender's name on ANNEX A hereto or, from and after the date
hereof, as set forth in the Register, representing such Lender's obligation,
upon and subject to the terms and conditions of this Agreement (including the
applicable provisions of SECTION 13.1), to make its Proportionate Share of Loans
(including to repay Swingline Loans) and to purchase participations in Letter of
Credit Guarantees.
"Commitment Percentage" means, as to any Lender at the time of
determination, the percentage obtained by dividing such Lender's Commitment at
such time by the aggregate amount of the Commitments at such time.
"Consolidated Subsidiary" means each Subsidiary of Xxxxxxx the
financial results of which, at the time in question, are consolidated with those
of Xxxxxxx in accordance with GAAP.
"Contaminant" means any waste, pollutant, hazardous substance,
toxic substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, or any constituent of any such substance or waste.
"Controlled Disbursement Account" means one or more accounts
maintained by and in the name of the Borrowers (or any of them) with a
Disbursing Bank for the purposes of disbursing Loan proceeds and amounts
deposited thereto.
"Current Assets" means, with respect to any Person, the
aggregate amount of assets of such Person which should properly be classified as
current assets in accordance with GAAP, after deducting adequate reserves in
each case where a reserve is appropriate in accordance with GAAP.
"Current Liabilities" means, with respect to any Person, the
aggregate amount of all Liabilities of such Person which should properly be
classified as current liabilities in accordance with GAAP.
"Debt" means
(a) Indebtedness for money borrowed,
(b) Indebtedness, whether or not in any such case the same was
for money borrowed,
(i) represented by notes payable, drafts accepted and
reimbursement obligations under letters of credit, including
Reimbursement Obligations, and similar instruments that
represent extensions of credit,
(ii) constituting obligations evidenced by bonds,
debentures, notes or similar instruments,
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(iii) any amounts required to be included in the
Purchase Price of any Acquisition pursuant to SECTION 11.4 and
not paid in cash at the closing of such Acquisition,
(iv) upon which interest charges are customarily paid
or that was issued or assumed as full or partial payment for
property (other than trade credit that is incurred in the
ordinary course of business),
(c) Capitalized Lease Obligations, and
(d) Indebtedness that is such by virtue of CLAUSE (C) of the
definition thereof, but only to the extent that the obligations Guaranteed are
Debt.
The KS Preferred is not Debt for purposes of this Agreement or the other Loan
Documents.
"Default" means any of the events specified in SECTION 12.1
which with the passage of time or giving of notice or both would constitute an
Event of Default.
"Default Margin" means 2.0%.
"Deposit Account" has the meaning set forth in the definition
"Collateral."
"Dilution Reserve" means an amount equal to the EXCESS of (i)
non-cash reductions to the Loan Parties' Receivables (on a combined basis)
during a 12-month period prior to the date of determination as established by
the Loan Parties' records or by a field examination conducted by the
Administrative Agent's, the Syndication Agent's or the Documentation Agent's
employees or representatives, expressed as a percentage of the Loan Parties'
Receivables (on a combined basis) outstanding during the same period OVER (ii)
5%, MULTIPLIED by an amount equal to Eligible Receivables as of the date of
determination.
"Disbursing Bank" means any commercial bank with which a
Controlled Disbursement Account is maintained after the Effective Date.
"Dollar" and "$" means freely transferable United States
dollars.
"Documentation Agent" means FUNB.
"EBIT" for any specified accounting period means Net Income of
Xxxxxxx and its Consolidated Subsidiaries on a consolidated basis for such
period before provision for net interest expense and income taxes PLUS up to
$3,500,000 in non-recurring charges related to what is commonly referred to by
the Borrowers as the "Xxxxx Settlement" deducted in computing Net Income for
such specified period.
"EBITDA" for any specified accounting period means EBIT for
such period PLUS depreciation and amortization expense deducted in computing
EBIT.
"ERISA" means the Employee Retirement Income Security Act of
1974, as in effect from time to time.
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"ERISA Event" means (a) a "Reportable Event" as defined in
Section 4043(c) of ERISA, but excluding any such event as to which the provision
for 30 days' notice to the PBGC is waived under applicable regulations, (b) the
filing of a notice of intent to terminate a Benefit Plan subject to Title IV of
ERISA under a distress termination under Section 4041(c) of ERISA or the
treatment of an amendment to such a Benefit Plan as a termination under Section
4041(c) of ERISA, (c) the institution of proceedings by the PBGC to terminate a
Benefit Plan subject to Title IV of ERISA or the appointment of a trustee to
administer any such Benefit Plan or an event or condition that might reasonably
be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Benefit Plan
subject to Section 4042, (d) the imposition of any liability under Title IV of
ERISA other than for PBGC premiums due but not yet payable, (e) the filing of an
application for a minimum funding waiver under Section 412 of the Code, (f) a
withdrawal by a Borrower or any Related Company from a Benefit Plan subject to
Section 4063 of ERISA during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA), (g) a Benefit Plan
intending to qualify under Section 401(a) of the Code losing such qualified
status (other than because of a Remediable Defect), (h) the failure to make a
material required contribution to a Benefit Plan, (i) a Borrower or any Related
Company being in "default" (as defined in Section 4219(c)(5) of ERISA) with
respect to payments to a Multiemployer Plan because of its complete or partial
withdrawal (as described in Section 4203 or 4205 of ERISA) from such
Multiemployer or Plan, or (j) the occurrence of a material non-exempt prohibited
transaction within the meaning of Section 4975 of the Code or Section 406 of
ERISA with respect to any Benefit Plan that is not cured within 60 days after a
Borrower has knowledge thereof.
"Effective Date" means the later of:
(a) the Agreement Date, and
(b) the first date on which all of the conditions set forth in
ARTICLE 5 shall have been fulfilled.
"Effective Interest Rate" means each rate of interest per
annum on Revolving Credit Loans and Swingline Loans in effect from time to time
pursuant to the provisions of SECTIONS 4.1(A) and (C).
"Eligible Assignee" means (i) a commercial bank organized
under the laws of the United States, or any State thereof, having total assets
in excess of $10,000,000,000; (ii) any commercial finance or asset based lending
company organized under the laws of the United States, or any State thereof,
that is an Affiliate of a commercial bank having total assets in excess of
$10,000,000,000; and (iii) any Lender listed on the signature page of this
Agreement; PROVIDED that the representation contained in SECTION 13.2 hereof
shall be applicable with respect to any such Person.
"Eligible Inventory" means items of Inventory of a Loan Party
held for sale in the ordinary course of the business of such Loan Party (but not
including packaging or shipping materials or maintenance supplies) that meet all
of the following requirements: (a) such Inventory is owned by a Loan Party, is
subject to the Security Interest, which is perfected as to such Inventory, and
is not subject to a Vendor Lien or any other Lien whatsoever other than a
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Permitted Lien (that is not a Vendor Lien); (b) such Inventory consists of raw
materials or finished goods and does not consist of work-in-process, supplies or
consigned goods; (c) such Inventory is in good condition and meets all standards
applicable to such goods, their use or sale imposed by any governmental agency,
or department or division thereof, having regulatory authority over such
matters; (d) such Inventory is currently either usable or saleable, at prices
approximating at least the cost thereof, in the normal course of the applicable
Loan Party's business; (e) such Inventory is not obsolete or returned or
repossessed or used goods taken in trade; (f) such Inventory is located within
the United States at one of the Permitted Inventory Locations; (g) such
Inventory is in the possession and control of a Loan Party and not any third
party and if located in a warehouse or other facility leased by a Loan Party,
the lessor has delivered to the Administrative Agent a waiver and consent in
form and substance satisfactory to the Administrative Agent or such facility is
reflected in the Rent Reserve; and (h) such Inventory is not determined by the
Administrative Agent, in the exercise of its reasonable credit judgment, to be
ineligible for any reason.
"Eligible Receivable" means the unpaid portion of a Receivable
payable in Dollars to a Loan Party net of any returns, discounts, credits, or
other allowances or deductions agreed to by a Loan Party and net of any amounts
owed by a Loan Party to the Account Debtor on such Receivable, which Receivable
meets all of the following requirements: (a) such Receivable is owned by a Loan
Party and represents a complete bona fide transaction which requires no further
act under any circumstances on the part of any Loan Party to make such
Receivable payable by the Account Debtor; (b) such Receivable is not past due
more than 60 days after its due date, which due date shall not be later than 90
days after the invoice date; (c) such Receivable does not arise out of any
transaction with any Subsidiary, Affiliate, creditor, lessor or supplier of a
Loan Party; (d) such Receivable is not owing by an Account Debtor more than 15%
of whose then-existing accounts owing to the Loan Parties do not meet the
requirements set forth in CLAUSE (B) above; (e) if the Account Debtor with
respect thereto is located outside of the United States of America, Canada or
Puerto Rico, the goods which gave rise to such Receivable were shipped after
receipt by the applicable Loan Party from the Account Debtor of an irrevocable
letter of credit that has been confirmed by a financial institution acceptable
to the Administrative Agent and is in form and substance acceptable to the
Administrative Agent, payable in the full face amount of the face value of the
Receivable in Dollars at a place of payment located within the United States and
has been duly assigned to the Administrative Agent, except that up to $1,000,000
of such Receivables outstanding at any time that are otherwise Eligible
Receivables, may be included in Eligible Receivables without such letter of
credit support; (f) the Account Debtor with respect to such Receivable is not
located in a state which imposes conditions on the enforceability of Receivables
with which the applicable Loan Party has not complied; (g) such Receivable is
not subject to the Assignment of Claims Act of 1940, as amended from time to
time, or any applicable law now or hereafter existing similar in effect thereto,
as determined in the sole discretion of the Administrative Agent, or to any
provision prohibiting its assignment or requiring notice of or consent to such
assignment; (h) the Loan Party that is the obligee thereof is not in breach of
any express or implied representation or warranty with respect to the goods the
sale of which gave rise to such Receivable; (i) the Account Debtor with respect
to such Receivable is not insolvent or the subject of any bankruptcy or
insolvency proceedings of any kind or of any other proceeding or action,
threatened or pending, which might, in the Administrative Agent's judgment, have
a materially adverse effect on such Account Debtor; (j) the goods the sale of
which gave rise to such Receivable were shipped or
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delivered to the Account Debtor on an absolute sale basis and not on a xxxx and
hold sale basis, a consignment sale basis, a guaranteed sale basis, a sale or
return basis or on the basis of any other similar understanding, and such goods
have not been returned or rejected; (k) such Receivable is not owing by an
Account Debtor or a group of affiliated Account Debtors whose then-existing
accounts owing to the Loan Parties exceed in face amount 20% of the Loan
Parties' total Eligible Receivables; (l) such Receivable is evidenced by an
invoice or other documentation in form acceptable to the Administrative Agent
containing only terms normally offered by the applicable Loan Party, and dated
no later than the date of shipment; (m) such Receivable is a valid, legally
enforceable obligation of the Account Debtor with respect thereto and is not
subject to any present, or contingent (and no facts exist which are the basis
for any future), offset, deduction or counterclaim, dispute or other defense on
the part of such Account Debtor; (n) such Receivable is not evidenced by chattel
paper or an instrument of any kind; (o) other than mechanical services performed
by Winston or CPW, such Receivable does not arise from the performance of
services, including services under or related to any warranty obligation of a
Loan Party or out of service charges by a Loan Party or other fees for the time
value of money; (p) such Receivable is subject to the Security Interest, which
is perfected as to such Receivable, and is subject to no other Lien whatsoever
other than a Permitted Lien and the goods giving rise to such Receivable were
not, at the time of the sale thereof, subject to any Lien other than a Permitted
Lien (that is not a Vendor Lien); and (q) such Receivable is not determined by
the Administrative Agent, in the exercise of its reasonable credit judgment, to
be ineligible for any reason.
"Environmental Laws" means all federal, state, local and
foreign laws now or hereafter in effect relating to pollution or protection of
the environment, including laws relating to emissions, discharges, Releases or
threatened Releases of pollutants, Contaminants, chemicals, or industrial, toxic
or hazardous substances or wastes into the environment (including, without
limitation, ambient air, surface water, ground water, or land), or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, removal, transport, or handling of pollutants, Contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes, and any and
all regulations, notices or demand letters issued, entered, promulgated or
approved thereunder; such laws and regulations include but are not limited to
the Resource Conservation and Recovery Act, 42 U.S.C. ss. 6901 et seq., as
amended; the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. ss. 9601 et seq., as amended; the Toxic Substances Control Act,
15 U.S.C. ss. 2601 et seq., as amended; the Clean Air Act, 46 U.S.C. ss. 7401 et
seq., as amended; and state and federal lien and environmental cleanup programs.
"Environmental Lien" means a Lien in favor of any governmental
entity for (a) any liability under Environmental Laws or (b) damages arising
from, or costs incurred by such governmental entity in response to, a Release or
threatened Release of Contaminant into the environment.
"Eurodollar Rate" means, with respect to any Eurodollar Rate
Loan for the Interest Period applicable thereto, a simple per annum interest
rate determined pursuant to the following formula:
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Eurodollar Rate = Interbank Offered Rate
---------------------------------
1 - Eurodollar Reserve Percentage
The Eurodollar Rate shall be adjusted automatically as of the effective date of
any change in the Eurodollar Reserve Percentage.
"Eurodollar Rate Loan" means any Loan (or Loans made (or
converted or continued) by the Lenders Ratably on the same date for the same
Interest Period), bearing interest determined with reference to the Eurodollar
Rate.
"Eurodollar Rate Revolving Credit Loan" means each Eurodollar
Rate Loan outstanding under the Revolving Credit Facility.
"Eurodollar Reserve Percentage" means that percentage
(expressed as a decimal) which is in effect from time to time under Regulation D
of the Board of Governors of the Federal Reserve System, as such regulation may
be amended from time to time, or any successor regulation, as the maximum
reserve requirement (including, without limitation, any basic, supplemental,
emergency, special, or marginal reserves) applicable with respect to
Eurocurrency liabilities as that term is defined in Regulation D (or against any
other category of liabilities that includes deposits by reference to which the
interest rate of Eurodollar Rate Loans is determined), whether or not any Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Rate Loans shall be deemed to constitute Eurocurrency
liabilities and as such shall be deemed subject to reserve requirements without
benefits of credits for proration, exceptions or offsets that may be available
from time to time to any Lender.
"Event of Default" means any of the events specified in
SECTION 12.1, PROVIDED that any requirement for notice or lapse of time or any
other condition has been satisfied.
"Existing Loan Agreement" has the meaning specified in the
Preliminary Statement.
"Existing Lender" has the meaning specified in the Preliminary
Statement.
"FCC" means Fleet Capital Corporation, a Rhode Island
corporation.
"FUNB" means First Union National Bank, a national banking
association.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve system arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next 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 for such day
on such transactions received by Bank from three federal funds brokers of
recognized standing selected by Bank.
"Financed Capex" means Capital Expenditures funded with the
proceeds of Debt (excluding Loans) or represented by Capitalized Lease
Obligations.
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"Financial Officer" means the chief financial officer,
Treasurer or Controller of Xxxxxxx.
"Financing Statements" means any and all Uniform Commercial
Code financing statements, in form and substance satisfactory to the
Administrative Agent, executed and delivered by a Loan Party to the
Administrative Agent or assigned to the Administrative Agent by BankBoston,
naming the Administrative Agent, for the benefit of the Lenders, as secured
party or assignee and the applicable Loan Party as debtor, in connection with
this Agreement.
"Fiscal Month" means each of the 12 consecutive four- or
five-week periods beginning on the first day of the Fiscal Year, in the pattern
4,4,5 within a Fiscal Quarter (or 4,5,5 in the fourth Fiscal Quarter of any
53-week Fiscal Year).
"Fiscal Quarter" means each of the four consecutive periods of
13 weeks (or 14 weeks in the fourth Fiscal Quarter of any 53-week Fiscal Year),
beginning on the first day of the Fiscal Year.
"Fiscal Year" means the period of 52 or 53 consecutive weeks
beginning on the Sunday after the Saturday nearest December 31 in one calendar
year and ending on the Saturday nearest December 31 of the following calendar
year and when followed or preceded by the designation of a calendar year, means
such period ending on the Saturday nearest December 31 of such designated
calendar year.
"Foreign Lender" means any Lender organized under the laws of
a jurisdiction outside of the United States.
"GAAP" means generally accepted accounting principles
consistently applied and maintained throughout the period indicated and, when
used with reference to a Borrower or any Subsidiary, consistent with the prior
financial practice of Xxxxxxx, as reflected on the financial statements referred
to in SECTION 6.1(N); PROVIDED, HOWEVER, that, in the event that changes shall
be mandated by the Financial Accounting Standards Board or any similar
accounting authority of comparable standing, or shall be recommended by
Xxxxxxx'x independent public accountants, such changes shall be included in GAAP
as applicable to Xxxxxxx and its Consolidated Subsidiaries only from and after
such date as the Borrowers, the Required Lenders and the Administrative Agent
shall have amended this Agreement to the extent necessary to reflect any such
changes in the financial covenants set forth in ARTICLE 11.
"Governmental Approvals" means all authorizations, consents,
approvals, licenses and exemptions of, registrations and filings with, and
reports to, all governmental bodies, whether federal, state, local or foreign
national or provincial and all agencies thereof.
"Guaranty", "Guaranteed" or to "Guarantee" as applied to any
obligation of another Person shall mean and include
(a) a guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), directly or
indirectly, in any manner, of any part or all of such obligation of such other
Person, and
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(b) an agreement, direct or indirect, contingent or otherwise,
and whether or not constituting a guaranty, the practical effect of which is to
assure the payment or performance (or payment of damages in the event of
nonperformance) of any part or all of such obligation of such other Person
whether by
(i) the purchase of securities or obligations,
(ii) the purchase, sale or lease (as lessee or
lessor) of property or the purchase or sale of services
primarily for the purpose of enabling the obligor with respect
to such obligation to make any payment or performance (or
payment of damages in the event of nonperformance) of or on
account of any part or all of such obligation, or to assure
the owner of such obligation against loss,
(iii) the supplying of funds to or in any other
manner investing in the obligor with respect to such
obligation,
(iv) repayment of amounts drawn down by beneficiaries
of letters of credit, or
(v) the supplying of funds to or investing in a
Person on account of all or any part of such Person's
obligation under a Guaranty of any obligation or indemnifying
or holding harmless, in any way, such Person against any part
or all of such obligation.
"Xxxxxxx" means Xxxxxxx Tire Group, Inc., a Delaware
corporation, successor by merger to The X.X. Xxxxxxx Company, Inc., a North
Carolina corporation.
"Indebtedness" of any Person means, without duplication, all
Liabilities of such Person, and to the extent not otherwise included in
Liabilities, the following:
(a) all obligations for money borrowed or for the deferred
purchase price of property or services or in respect of drafts accepted or
similar instruments or reimbursement obligations under letters of credit,
(b) all obligations (including, during the noncancellable term
of any lease in the nature of a title retention agreement, all future payment
obligations under such lease discounted to their present value in accordance
with GAAP) secured by any Lien to which any property or asset owned or held by
such Person is subject, whether or not the obligation secured thereby shall have
been assumed by such Person,
(c) all obligations of other Persons which such Person has
Guaranteed, including, but not limited to, all obligations of such Person
consisting of recourse liability with respect to accounts receivable sold or
otherwise disposed of by such Person,
(d) all obligations of such Person in respect of Interest Rate
Protection Agreements, and
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(e) in the case of the Borrowers (without duplication) all
obligations under the Loans and the Reimbursement Obligations.
"Initial Notice of Borrowing" means the Notice of Borrowing
given by the Borrowers with respect to the Loans to be made on the Effective
Date which shall also specify the method of disbursement.
"Interbank Offered Rate" for an Interest Period means the rate
per annum (rounded upwards, if necessary to the nearest 1/100 of 1%) appearing
on Telerate Page 3750 (or any successor page) as the London interbank offered
rate for deposits in Dollars at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period. If for any reason such rate is not
available, the term "Interbank Offered Rate" shall mean, for any Eurodollar Rate
Loan for any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on the Reuters Screen LIBO Page
as the London interbank offered rate for deposits in Dollars at approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period; PROVIDED,
HOWEVER, that if more than one rate is specified on the Reuters Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates.
"Interest Coverage Ratio" means for any specified measurement
period, the ratio of (i) EBITDA for such period to (ii) consolidated interest
expense of Xxxxxxx and its Consolidated Subsidiaries for such period.
"Interest Payment Date" means the first day of each calendar
month commencing April 1, 2000.
"Interest Period" means with respect to each Eurodollar Rate
Loan, the period commencing on the date of the making or continuation of or
conversion to such Eurodollar Rate Loan and ending one, two, three, six or, if
available in the Administrative Agent's reasonable judgment to all Lenders,
twelve months thereafter, as the Borrowers may elect in the applicable Notice of
Borrowing or Notice of Conversion or Continuation; PROVIDED, that:
(i) any Interest Period that would otherwise end on a
day that is not a Business Day shall, subject to the
provisions of CLAUSE (III) below, be extended to the next
succeeding Business Day unless such Business Day falls in the
next calendar month, in which case such Interest Period shall
end on the immediately 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, subject to CLAUSE
(III) below, end on the last Business Day of a calendar month;
(iii) any Interest Period that would otherwise end
after the Termination Date shall end on the Termination Date;
and
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(iv) notwithstanding CLAUSE (III) above, no Interest
Period shall have a duration of less than one month and if any
applicable Interest Period would be for a shorter period, such
Interest Period shall not be available hereunder.
"Interest Rate Protection Agreement" shall mean an interest
rate swap, cap or collar agreement or similar arrangement between any Person and
a financial institution providing for the transfer or mitigation of interest
risks either generally or under specific contingencies.
"Inventory" has the meaning set forth in the definition
"Collateral."
"Investment" means, with respect to any Person:
(a) the acquisition or ownership by such Person of any share
of capital stock, evidence of Indebtedness or other security issued by any other
Person,
(b) any loan, advance or extension of credit to, or
contribution to the capital of, any other Person, excluding advances to
employees in the ordinary course of business for business expenses,
(c) any Guaranty of the obligations of any other Person,
(d) any other investment (other than the Acquisition of a
Business Unit) in any other Person, and
(e) any commitment or option to make any of the investments
listed in CLAUSES (A) through (D) above if, in the case of an option, the
consideration therefor exceeds $100.
"Investment Account" has the meaning set forth in the
definition "Collateral."
"Investment Property" has the meaning set forth in the
definition "Collateral."
"IRS" means the Internal Revenue Service.
"Issuing Bank" means BankBoston as to Letters of Credit
outstanding on the Effective Date and Bank as to Letters of Credit issued on and
after the Effective Date.
"KS Preferred" means up to 7,000 shares of Series A Cumulative
Redeemable Preferred Stock and up to 4,500 shares of Series B Cumulative
Redeemable Preferred Stock of Xxxxxxx issued by Xxxxxxx and sold to The
Kelly-Springfield Tire Company, a division of The Goodyear Tire and Rubber
Company, pursuant to the KS Preferred Stock Purchase Agreement.
"KS Preferred Stock Purchase Agreement" means the Securities
Purchase Agreement dated May 7, 1997 between Xxxxxxx and The Kelly-Springfield
Tire Company, a division of The Goodyear Tire and Rubber Company, as amended and
in effect on the Effective Date and modified after the Effective Date in
accordance with the terms of this Agreement.
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"Lender" means at any time any financial institution party to
this agreement at such time, including any such Person becoming a party hereto
pursuant to the provisions of ARTICLE 13.
"Letter of Credit" means each documentary or standby letter of
credit (i) issued by BankBoston for the account of a Borrower under the Existing
Loan Agreement and outstanding on the Effective Date or (ii) issued by the
Issuing Bank for the account of a Borrower or any Subsidiary and Guaranteed by
FCC pursuant to ARTICLE 3.
"Letter of Credit Amount" means, at any time with respect to
any Letter of Credit Guarantee, the aggregate maximum amount at any time
available for drawing under the Guaranteed Letter of Credit at such time
(assuming all conditions to drawing are satisfied).
"Letter of Credit Availability" means, as of the date of
determination, the aggregate face amount of Letter of Credit Obligations
available to be incurred hereunder at the time of determination in accordance
with SECTION 3.2, which shall be an amount equal to the lesser of (i) the Letter
of Credit Guarantee Facility MINUS the Letter of Credit Obligations and (ii) the
Loan Availability, on such date.
"Letter of Credit Guarantee" means any Guarantee pursuant to
which FCC or any of its Affiliates Guarantees to an Issuing Bank, the payment or
performance by a Loan Party of its Reimbursement Obligations under any Letter of
Credit, including by FCC's (or such Affiliate's) joining in the Reimbursement
Agreement for such Letter of Credit as a co-applicant or otherwise as acceptable
to the Issuing Bank.
"Letter of Credit Guarantee Facility" means a subfacility of
the Revolving Credit Facility providing for the issuance of Letters of Credit
and Letter of Credit Guarantees as described in Article 3 in an aggregate amount
of Letter of Credit Obligations at any one time outstanding not to exceed
$10,000,000.
"Letter of Credit Obligations" means, at any time, the sum of
(a) the Reimbursement Obligations at such time, PLUS (b) the aggregate Letter of
Credit Amount of Letter of Credit Guarantees outstanding at such time, PLUS (c)
the aggregate Letter of Credit Amount of Letter of Credit Guarantees the
issuance of which has at such time been authorized by the Administrative Agent
and FCC pursuant to SECTION 3.4(B) but that have not yet been issued, in each
case as determined by the Administrative Agent.
"Letter of Credit Reserve" means, at any time, the aggregate
Letter of Credit Obligations at such time, other than Letter of Credit
Obligations that are fully secured by Cash Collateral.
"Liabilities" of any Person means all items (except for items
of capital stock, including specifically as to Xxxxxxx the KS Preferred,
additional paid-in capital or retained earnings, or of general contingency or
deferred tax reserves) which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance sheet
of such Person as at the date as of which Liabilities are to be determined.
"Lien" as applied to the property of any Person means:
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(a) any mortgage, deed to secure debt, deed of trust, lien,
pledge, charge, lease constituting a Capitalized Lease Obligation, conditional
sale or other title retention agreement, or other security interest, security
title or encumbrance of any kind in respect of any property of such Person, or
upon the income or profits therefrom,
(b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise identified for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other obligation in priority to the payment of the general, unsecured
creditors of such Person,
(c) any Indebtedness which is unpaid more than 30 days after
the same shall have become due and payable and which if unpaid might by law
(including, but not limited to, bankruptcy and insolvency laws), or otherwise,
be given any priority whatsoever over the claims of general unsecured creditors
of such Person, except to the extent being disputed or contested by such Person
by appropriate proceedings and in respect of which any reserve required by GAAP
has been appropriately established and maintained,
(d) the filing of, or any agreement to give, any financing
statement under the UCC or its equivalent in any jurisdiction (excluding
informational financing statements relating to property leased by a Borrower or
any Subsidiary), and
(e) in the case of Real Estate, reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances.
"Loan" means any Revolving Credit Loan or Swingline Loan, as
well as all such loans collectively, as the context requires.
"Loan Account" and "Loan Accounts" have the meanings specified
in SECTION 4.5.
"Loan Availability" means, as of the date of determination,
the aggregate principal amount of Revolving Credit Loans available to be
borrowed by the Borrowers hereunder at the time in accordance with SECTION 2.1,
which shall be an amount equal to the remainder derived by subtracting the
aggregate principal amount of Revolving Credit Loans and Swingline Loans
outstanding on such date from the Borrowing Base on such date.
"Loan Documents" means collectively this Agreement, the Notes,
the Security Documents and each other instrument, agreement or document executed
by a Loan Party or any Affiliate or Subsidiary of a Loan Party in connection
with this Agreement whether prior to, on or after the Effective Date and each
other instrument, agreement or document referred to herein or contemplated
hereby.
"Loan Party" means any Borrower or Subsidiary Guarantor.
"Lockbox" means each U. S. Post Office Box specified in a
Lockbox Agreement.
"Lockbox Agreement" means each agreement between a Borrower
and a Clearing Bank concerning the establishment of a Lockbox for the collection
of Receivables.
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"Margin Stock" means margin stock as defined in Section
221.1(h) of Regulation U.
"Materially Adverse Effect" means any act, omission,
situation, circumstance, event or undertaking which would, singly or in any
combination with one or more other acts, omissions, situations, circumstances,
events or undertakings, have, or reasonably be expected to have, a materially
adverse effect upon (a) the business, assets, properties, liabilities, condition
(financial or otherwise), results of operations or business prospects of Xxxxxxx
and its Consolidated Subsidiaries taken as a whole, (b) the value of the whole
or any material part of the Collateral, (c) the Security Interest or the
priority of the Security Interest, (d) the ability of Xxxxxxx and its
Consolidated Subsidiaries taken as a whole to perform any material obligation
under this Agreement or any other Loan Document, or (e) other than solely and
directly by reason of any release given or other action taken by the
Administrative Agent or any Lender, the legality, validity, binding effect,
enforceability or admissibility into evidence of any Loan Document or the
ability of the Administrative Agent or the Lenders to enforce in any material
respect any rights or remedies under or in connection with any Loan Document.
"Minimum Commitment" means $10,000,000.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which a Borrower or a Related Company is
required to contribute or has contributed within the immediately preceding six
years.
"Net Amount" means, with respect to any Investments made by
any Person, the gross amount of all such Investments MINUS the aggregate amount
of all cash received and the fair value, at the time of receipt by such Person,
of all property received as payments of principal or premiums, returns of
capital, liquidating dividends or distributions, proceeds of sale or other
dispositions with respect to such Investments.
"Net Income" or "Net Loss" means, as applied to any Person for
any accounting period, the net income or net loss, as the case may be, of such
Person for the period in question after giving effect to deduction of or
provision for all operating expenses, all taxes and reserves (including reserves
for deferred taxes) and all other proper deductions, all determined in
accordance with GAAP, PROVIDED that there shall be excluded:
(a) the net income or net loss of any Person accrued prior to
the date it becomes a Subsidiary of, or is merged into or consolidated with, the
Person whose Net Income is being determined or a Subsidiary of such Person,
(b) the net income or net loss of any Person in which the
Person whose Net Income is being determined or any Subsidiary of such Person has
an ownership interest, except, in the case of net income, to the extent that any
such income has actually been received by such Person or such Subsidiary in the
form of cash dividends or similar distributions,
(c) any restoration of any contingency reserve, except to the
extent that provision for such reserve was made out of income during such
period,
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(d) any net gains or losses on the sale or other disposition,
not in the ordinary course of business, of Investments, Business Units and other
capital assets, provided that there shall also be excluded any related charges
for taxes thereon,
(e) any net gain arising from the collection of the proceeds
of any insurance policy,
(f) any write-up of any asset, and
(g) any other extraordinary item.
"Net Outstandings" of any Lender means, at any time, the sum
of (a) all amounts paid by such Lender (other than pursuant to SECTION 14.7) to
the Administrative Agent in respect of Revolving Credit Loans made by such
Lender, MINUS (b) all amounts received by the Administrative Agent and paid by
the Administrative Agent to such Lender for application, pursuant to this
Agreement, to reduction of the outstanding principal balance of the outstanding
Revolving Credit Loans of such Lender.
"Net Worth" means, with respect to any Person, such Person's
total shareholder's equity (including specifically as to Xxxxxxx the KS
Preferred, the Warrant and including any other capital stock, warrants,
additional paid-in capital and retained earnings, after deducting treasury
stock) which would appear as such on a balance sheet of such Person prepared in
accordance with GAAP.
"New Lender" has the meaning specified in the Preliminary
Statement.
"Non-Ratable Loan" means a Base Rate Loan made by FCC in
accordance with the provisions of SECTION 4.8(B).
"Note" means any of the Revolving Credit Notes and the
Swingline Note and "Notes" means more than one such Note.
"Notice of Borrowing" means a written notice (including by
electronic mail), or telephonic notice followed by a confirming same-day written
notice, requesting a Borrowing of, respectively, (i) Base Rate Revolving Credit
Loans or Eurodollar Rate Revolving Credit Loans or (ii) a Swingline Loan which
is given by telex or facsimile transmission in accordance with the applicable
provisions of SECTION 2.2 or SECTION 2A.2, as the case may be, and which
specifies (i) the amount of the requested Borrowing, (ii) the date of the
requested Borrowing, and (iii) if the requested Borrowing is of Eurodollar Rate
Loans, the duration of the applicable Interest Period.
"Notice of Conversion or Continuation" has the meaning
specified in SECTION 4.13.
"Overadvance" means at any time the amount by which the
aggregate outstanding principal amount of Loans exceeds the Borrowing Base.
"Overadvance Condition" means and is deemed to exist any time
the aggregate outstanding principal amount of Loans exceeds the Borrowing Base.
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"Overadvance Loan" means a Base Rate Loan made at a time an
Overadvance Condition exists or which results in an Overadvance Condition.
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor agency.
"Permitted Inventory Locations" means each location listed on
SCHEDULE 6.1(U) and from time to time each other location within the continental
United States which Xxxxxxx has notified the Administrative Agent is a location
at which Inventory of a Loan Party is maintained together with such evidence as
the Administrative Agent may reasonably require that the Inventory at such
location is subject to the Security Interest and to no other Lien other than
Permitted Liens.
"Permitted Investments" means
(a) Investments of Xxxxxxx and its Consolidated Subsidiaries
in:
(i) cash and Cash Equivalents in an aggregate amount not
greater than $5,000,000,
(ii) sales of inventory on credit in the ordinary course of
business,
(iii) shares of capital stock, evidence of Debt or other
security acquired in consideration for or as evidence of past-due or
restructured Receivables in an aggregate face amount of such
Receivables as to Xxxxxxx and its Subsidiaries at any time not to
exceed $2,500,000,
(iv) any Loan Party, and
(v) those items described on SCHEDULE 1.1A - PERMITTED
INVESTMENTS; and
(b) Investments of any Loan Party in any Subsidiary that is
not a Loan Party to the extent in existence on the Effective Date, as such
Investments may increase by reason of the profitable operations of such
Subsidiary.
"Permitted Liens" means:
(a) Liens securing taxes, assessments and other governmental
charges or levies (excluding any Lien imposed pursuant to any of the provisions
of ERISA) or the claims of materialmen, mechanics, carriers, warehousemen or
landlords for labor, materials, supplies or rentals incurred in the ordinary
course of business, but (i) in all cases only if payment shall not at the time
be required to be made in accordance with SECTION 9.6, and (ii) in the case of
warehousemen or landlords, only if such liens are junior to the Security
Interest in any of the Collateral or the relevant premises are reflected in the
Rent Reserve,
(b) Liens consisting of deposits or pledges made in the
ordinary course of business in connection with, or to secure payment of,
obligations under workers' compensation, unemployment insurance or similar
legislation or under payment or performance bonds,
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(c) Liens constituting encumbrances in the nature of zoning
restrictions, easements, and rights or restrictions of record on the use of real
property, which do not materially detract from the value of such property or
impair the use thereof in the business of the applicable Borrower,
(d) Liens shown on SCHEDULE 1.1B - PERMITTED LIENS,
(e) Vendor Liens,
(f) Liens of the Administrative Agent, for the benefit of the
Lenders, arising under this Agreement and the other Loan Documents,
(g) Liens on Margin Stock,
(h) Liens in existence immediately prior to the Effective Date
that are satisfied in full and released on the Effective Date or promptly
thereafter by application of the proceeds of the Loans or cash on hand,
(i) the Lien of FUNB as Trustee under the Senior Note
Indenture pursuant to Section 7.07 thereof on certain property in its possession
as security for payment of fees and other amounts owing to it in its capacity as
such Trustee, and
(j) additional Liens in accordance with the provisions of
SECTION 11.9.
"Person" means an individual, corporation, limited liability
company, partnership, association, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
"Projections" means the forecasted (a) balance sheets, (b)
income statements and (c) cash flow statements of the Borrowers for each Fiscal
Year, prepared annually by the Borrowers on a consolidated monthly basis,
together with appropriate supporting details (including stand-alone forecasts
for each Borrower) and a statement of underlying assumptions.
"Proportionate Share" or "Ratable Share" or "Ratable" (and
with corollary meaning, "Ratably") means, as to a Lender, such Lender's share of
an amount in Dollars or of other property at the time of determination equal to
(i) the Commitment Percentage of such Lender, or (ii) if the Commitments are
terminated, the percentage obtained by dividing the principal amount of the
Loans then owing to such Lender by the total principal amount of all Loans then
owing to all Lenders, or (iii) if no Loans are outstanding, the percentage
obtained by dividing such Lender's participation in the total Letter of Credit
Obligations then outstanding by the total Letter of Credit Obligations then
outstanding.
"Proprietary Rights" means as to any Person, such Person's
rights, title and interest in and to intellectual property and all other rights
(including rights as a licensee thereof) under any patents, trademarks, trade
names, tradestyles, copyrights and all extensions, renewals, reissues,
divisions, continuations, and continuations-in-part of any of the foregoing, and
all rights to xxx for past, present and future infringement of any of the
foregoing.
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"Purchase Money Lien" means any Lien securing Debt created to
finance the payment of all or any part of the purchase price (not in excess of
the fair market value thereof) of any tangible personal property (other than
Inventory) and incurred at the time of or within 10 days prior to or after the
acquisition of such tangible asset, but only if such Lien shall at all times be
confined solely to the property (other than Inventory) the purchase price of
which was financed through the incurrence of such Debt.
"Purchase Price" has the meaning specified in SECTION 11.4.
"Real Estate" means all real property now or hereafter owned
or leased by Xxxxxxx or any Subsidiary, including, without limitation, all fees,
leaseholds and future interests.
"Receivables" has the meaning set forth in the definition
"Collateral."
"Register" has the meaning specified in SECTION 13.1(D).
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System (or any successor).
"Reimbursement Agreement" means, with respect to a Letter of
Credit, such form of application therefor and form of reimbursement agreement
therefor (whether in a single document or several documents) as the Issuing Bank
may employ in the ordinary course of business for its own account, in such form
as may be acceptable to FCC in its reasonable judgment and with such
modifications thereto as may be agreed upon by the Issuing Bank, FCC and the
Borrowers, PROVIDED that such application and agreement and any modifications
thereto are not inconsistent with the terms of this Agreement.
"Reimbursement Obligations" means the unsatisfied
reimbursement or repayment obligations of the Borrowers to FCC pursuant to
SECTION 3.6 or (but without duplication) to an Issuing Bank pursuant to a
Reimbursement Agreement with respect to amounts that have been drawn under
Letters of Credit Guaranteed by FCC.
"Related Company" means any (i) corporation which is a member
of the same controlled group of corporations (within the meaning of Section
414(b) of the Code) as Xxxxxxx; (ii) partnership or other trade or business
(whether or not incorporated) under common control (within the meaning of
Section 414(c) of the Code) with Xxxxxxx; or (iii) member of the same affiliated
service group (within the meaning of Section 414(m) of the Code) as Xxxxxxx, any
corporation described in CLAUSE (I) above or any partnership, trade or business
described in CLAUSE (II) above.
"Release" means release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the indoor or outdoor environment or into or out of any property, including the
movement of Contaminants through or in the air, soil, surface water or
groundwater.
"Remediable Defect" means an operational defect or violation
that could disqualify a Benefit Plan intended to qualify under Section 401(a)
(and, if applicable, Section 401(k)) of the Code and that can be remedied under
the IRS's Closing Agreement Program,
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Voluntary Compliance Resolution Program, or Administrative Policy Regarding
Self-Correction, without in any case a payment to any governmental authority
with respect to such Benefit Plan and any other Benefit Plan of more than
$100,000 in any calendar year.
"Remedial Action" means actions required to (i) clean up,
remove, treat or in any other way address Contaminants in the indoor or outdoor
environment; (ii) prevent the Release or threat of Release or minimize the
further Release of Contaminants so they do not migrate or endanger or threaten
to endanger public health or welfare or the indoor or outdoor environment; or
(iii) perform pre-remedial studies and investigations and post-remedial
monitoring and care.
"Rent Reserve" means an amount approximately equal to the
aggregate monthly rental payable by the Borrowers on all leased Real Estate in
respect of which landlord's or warehouseman's waivers, in form and substance
acceptable to the Administrative Agent, are not in effect or such greater amount
as the Administrative Agent may, in its reasonable credit judgment, determine to
be appropriate after notice to the Borrowers.
"Required Lenders" means, at any time, any combination of two
or more Lenders whose Commitment Percentages at such time aggregate in excess of
50%.
"Restricted Distribution" by any Person means (a) its
retirement, redemption, purchase, or other acquisition or retirement for value
of any capital stock or other equity securities (except equity securities
acquired on the conversion or exercise thereof into other equity securities of
such Person) or partnership interests issued by such Person, (b) the declaration
or payment of any dividend or distribution in cash or property on or with
respect to any such securities (other than dividends payable solely in shares of
its capital stock) or partnership interests, EXCLUDING, HOWEVER, any such
dividend, distribution or payment to a Loan Party by any of its Subsidiaries,
(c) any Investment (other than a Permitted Investment) by such Person in, the
holder of any of such securities or partnership interests, and (d) any other
payment by such Person in respect of such securities or partnership interests.
"Restricted Payment" means (a) any redemption or prepayment or
other retirement, prior to the stated maturity thereof or prior to the due date
of any regularly scheduled installment or amortization payment with respect
thereto, of any Debt (other than the Loans) or of any Indebtedness that is
junior and subordinate to the Secured Obligations, (b) any payment on or with
respect to any Subordinated Debt other than in accordance with the subordination
provisions thereof, (c) the payment by any Person of the principal amount of or
interest on any Indebtedness (other than trade accounts payable and employee
compensation in the ordinary course of business, consistent with past practices)
owing to an Affiliate of such Person or to any Affiliate of any such Affiliate
and (d) the payment of any management, consulting or similar fee by any Person
to any Affiliate of such Person.
"Revolving Credit Facility" means the credit facility
providing for Revolving Credit Loans based upon the Borrowing Base and described
in SECTION 2.1 up to an aggregate principal amount at any one time outstanding
not to exceed $200,000,000 or such lesser or greater amount as shall be agreed
upon from time to time in writing by the Administrative Agent, the Syndication
Agent, the Documentation Agent, the Lenders and the Borrowers.
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"Revolving Credit Loans" means (i) the Loans under and as
defined in the Existing Loan Agreement outstanding on the Effective Date and
(ii) the Loans made to the Borrowers pursuant to SECTION 2.1., including any
Non-Ratable Loan.
"Revolving Credit Note" means each Second Amended and Restated
Promissory Note made by the Borrowers payable to the order of a Lender
evidencing the joint and several obligation of the Borrowers to pay the
aggregate unpaid principal amount of the Loans made to them by such Lender under
the Revolving Credit Facility (and any promissory note or notes that may be
issued from time to time in substitution, renewal, extension, replacement or
exchange therefor whether payable to such Lender or to a different Lender in
connection with a Person becoming a Lender after the Effective Date or
otherwise) substantially in the form of EXHIBIT A-1 hereto, with all blanks
properly completed, either as originally executed or as the same may from time
to time be supplemented, modified, amended, renewed, extended or refinanced.
"S&P" means Standard & Poor's Ratings Service, a division of
The XxXxxx-Xxxx Companies.
"Schedule of Inventory" means a schedule delivered by the
Borrowers to the Administrative Agent pursuant to the provisions of SECTION
8.12(B).
"Schedule of Receivables" means a schedule delivered by the
Borrowers to the Administrative Agent pursuant to the provisions of SECTION
8.12(A).
"Secured Obligations" means, in each case whether now in
existence or hereafter arising,
(a) the principal of and interest on the Loans,
(b) the Reimbursement Obligations and all other obligations of
the Borrowers to FCC, any Lender or any Affiliate of a Lender arising in
connection with the issuance of Letter of Credit Guarantees,
(c) all obligations of the Borrowers to any Lender or any
Affiliate of a Lender (i) under any Interest Rate Protection Agreement, and (ii)
under, arising out of or related to any ACH Transfer arrangement, and
(d) all indebtedness, liabilities, obligations, covenants and
duties of the Borrowers or any Subsidiary to the Administrative Agent or to the
Lenders or to any Affiliate of the Administrative Agent or any Lender of every
kind, nature and description arising under or in respect of this Agreement, the
Notes or any of the other Loan Documents, whether direct or indirect, absolute
or contingent, due or not due, contractual or tortious, liquidated or
unliquidated, and whether or not evidenced by any note, and whether or not for
the payment of money, including without limitation, fees required to be paid
pursuant to ARTICLE 4 and expenses required to be paid or reimbursed pursuant to
SECTION 15.2.
"Security Documents" means the Financing Statements, any
Subsidiary Security Agreements and each other writing executed and delivered by
a Loan Party or any other Person
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securing the Secured Obligations or assuring rights of the Administrative Agent
or the Lenders in respect of the Collateral.
"Security Interest" means the Liens of the Administrative
Agent, for the benefit of itself as the Administrative Agent and the Lenders and
Affiliates of the Lenders, on and in the Collateral effected hereby or by any of
the Security Documents or pursuant to the terms hereof or thereof.
"Senior Note Indenture" means collectively (i) the Indenture,
dated as of May 15, 1998, as amended and supplemented by the Supplemental
Indenture, dated as of February 22, 1999, and the Second Supplemental Indenture,
dated as of May 14, 1999, each between Xxxxxxx and First Union National Bank,
Trustee, and (ii) the Indenture, dated as of December 1, 1998, as amended and
supplemented by the Supplemental Indenture, dated as of February 22, 1999, and
the Second Supplemental Indenture, dated as of May 14, 1999, each between
Xxxxxxx and First Union National Bank, Trustee.
"Senior Notes" means Xxxxxxx'x 10% Senior Notes due 2008 in
the original principal amount of $150,000,000, issued pursuant to the Senior
Note Indenture, including any "Exchange Securities" and "Private Exchange
Securities" issued (and as defined) thereunder.
"Settlement Date" means each Business Day after the Effective
Date selected by the Administrative Agent in its sole discretion subject to and
in accordance with the provisions of SECTION 4.8(B)(I) as of which a Settlement
Report is delivered by the Administrative Agent and on which settlement is to be
made among the Lenders in accordance with the provisions of SECTION 4.8.
"Settlement Report" means each report substantially in the
form employed by the Administrative Agent from time to time or as the
Administrative Agent and the Lenders may otherwise agree, prepared by the
Administrative Agent and delivered to each Lender and setting forth, among other
things, as of the Settlement Date indicated thereon and as of the next preceding
Settlement Date, the aggregate principal balance of all Revolving Credit Loans
outstanding, each Lender's Proportionate Share thereof, each Lender's Net
Outstandings and all payments of principal and interest in respect of Revolving
Credit Loans and of fees received by the Administrative Agent from the Borrowers
during the period beginning on such next preceding Settlement Date and ending on
such Settlement Date.
"Subordinated Debt" means any Debt of Xxxxxxx or any
Subsidiary that is subordinated to the Secured Obligations on terms and
conditions acceptable to the Required Lenders in their sole discretion.
"Subsidiary" (a) when used to determine the relationship of a
Person to another Person, means a Person of which an aggregate of 50% or more of
the stock of any class or classes or 50% or more of other ownership interests is
owned of record or beneficially by such other Person, or by one or more
Subsidiaries of such other Person, or by such other Person and one or more
Subsidiaries of such Person,
(i) if the holders of such stock, or other ownership
interests, (A) are ordinarily, in the absence of
contingencies, entitled to vote for the election of a
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majority of the directors (or other individuals performing
similar functions) of such Person, even though the right so to
vote has been suspended by the happening of such a
contingency, or (B) are entitled, as such holders, to vote for
the election of a majority of the directors (or individuals
performing similar functions) of such Person, whether or not
the right so to vote exists by reason of the happening of a
contingency, or
(ii) in the case of such other ownership interests,
if such ownership interests constitute a majority voting
interest and
(b) when used without other designation of ownership, means a
Subsidiary of Xxxxxxx.
"Subsidiary Guarantor" means any Subsidiary of Xxxxxxx that is
not a Borrower and that has, at the Administrative Agent's request or with its
consent, executed and delivered a Subsidiary Guaranty and a Subsidiary Security
Agreement.
"Subsidiary Guaranty" means a Guaranty of the Secured
Obligations substantially in the form of EXHIBIT F attached hereto or as
otherwise acceptable to the Administrative Agent and Xxxxxxx.
"Subsidiary Security Agreement" means one or more agreements
substantially in the form of EXHIBIT F attached hereto or otherwise in form and
substance satisfactory to the Administrative Agent in its reasonable judgment,
sufficient to create in favor of the Administrative Agent a security interest in
all of the Receivables, Inventory and proceeds thereof of any Subsidiary
Guarantor.
"Swingline Facility" means an amount equal to $5,000,000.
"Swingline Lender" means FCC.
"Swingline Loan" means each advance by the Swingline Lender to
the Borrowers pursuant to SECTION 2A.1.
"Swingline Loan Request" has the meaning set forth in SECTION
2A.2.
"Swingline Note" means the Swingline Note made by the
Borrowers payable to the order of the Swingline Lender evidencing the joint and
several obligation of the Borrowers to pay the aggregate unpaid principal amount
of the Swingline Loans made to them by the Swingline Lender under the Swingline
Facility (and any promissory note that may be issued from time to time in
substitution, renewal, extension, replacement or exchange therefor)
substantially in the form of EXHIBIT A-2 hereto, with all blanks properly
completed, either as originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or refinanced.
"Syndication Agent" means Bank of America.
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"Termination Date" means March 6, 2005, such earlier date as
all Secured Obligations shall have been irrevocably paid in full and the
Commitments shall have been terminated, or such later date to which the same may
be extended pursuant to the provisions of SECTION 2.5.
"Type" when used in respect of any Loan or Borrowing, shall
refer to the rate by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined.
"UCC" means the Uniform Commercial Code as in effect from time
to time in the applicable jurisdiction.
"Unfunded Vested Accrued Benefits" means at any time, with
respect to any Benefit Plan that is a pension plan within the meaning of Section
3(2) of ERISA, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Benefit Plan exceeds (b) the fair market
value of all such Benefit Plan assets allocable to such benefits, as determined
using the valuation date and such reasonable actuarial assumptions and methods
as are specified in the Schedule B (Actuarial Information) to the most recent
Annual Report (Form 5500) filed with respect to such Benefit Plan.
"Unused Commitments" has the meaning specified in SECTION
4.2(B).
"Vendor Lien" means any Lien affecting tire Inventory of a
Loan Party for the benefit of the vendor of such Inventory, as security for the
payment or repayment of amounts (including trade accounts and vendor loans
permitted pursuant to SECTION 11.2(F)) owing by such Loan Party to such vendor;
provided, that if and to the extent that any such Lien purports to affect any
property of a Loan Party other than such tire Inventory (including, without
being limited to, proceeds including accounts), such Lien as it affects such
other property is subordinated to the Security Interest in a manner satisfactory
to the Administrative Agent.
"Warrant" means the Amended and Restated Warrant No. 2 to
purchase common stock of Xxxxxxx issued to The 1818 Mezzanine Fund II, L.P., as
amended and in effect on the Effective Date and as thereafter amended in
accordance with the provisions of this Agreement.
"Wholly Owned Subsidiary" when used to determine the
relationship of a Subsidiary to a Person means a Subsidiary all of the issued
and outstanding shares (other than directors' qualifying shares) of the capital
stock of which shall at the time be owned by such Person or one or more of such
Person's Wholly Owned Subsidiaries or by such Person and one or more of such
Person's Wholly Owned Subsidiaries.
"Winston" means Winston Tire Company, a California corporation
and a Wholly Owned Subsidiary of Xxxxxxx.
"Year 2000 Compliant" as to any Person means that all
software, embedded microchips and other processing capabilities utilized by, and
material to the business operations or financial condition of, such Person are
able to interpret and manipulate data on and involving all calendar dates
correctly and without causing any abnormal ending scenario, including in
relation to dates in and after the calendar year 2000.
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SECTION 1.2 General Interpretive Rules.
(a) All terms of an accounting nature not specifically defined
herein shall have the meanings ascribed thereto by GAAP.
(b) The terms accounts, chattel paper, contract rights,
documents, equipment, instruments, general intangibles, inventory and proceeds,
as and when used in this Agreement or the Security Documents (without being
capitalized), shall have the meanings given those terms in the UCC.
(c) Unless otherwise specified, the words "hereof," "herein,"
"hereunder" and words of similar import, when used in this Agreement, refer to
this Agreement as a whole and not to any particular provision, section or
subsection of this Agreement.
(d) Wherever from the context it appears appropriate, each
term stated in either the singular or plural shall include the singular and
plural, and pronouns stated in the masculine, feminine or neuter gender shall
include the masculine, the feminine and the neuter. Words denoting individuals
include corporations and vice versa.
(e) References to any legislation or statute or code, or to
any provisions of any legislation or statute or code, shall include any
modification or reenactment of, or any legislative, statutory or code provision
substituted for, such legislation, statute or code or provision thereof.
(f) References to any document or agreement (including this
Agreement) shall include references to such document or agreement as amended,
novated, supplemented, modified or replaced from time to time, so long as and to
the extent that such amendment, novation, supplement, modification or
replacement is not prohibited by the terms of this Agreement or is consented to,
if such consent is required, in accordance with the applicable provisions of
this Agreement.
(g) Except where specifically restricted in a Loan Document,
references to any Person include its successors and substitutes and assigns
permitted or not prohibited under such Loan Document.
(h) References to the time of day are to the time of day in
the city in which the Administrative Agent's Office is located.
(i) The terms "payment", "prepayment", "distribution" and
similar terms used in the definitions of "Restricted Distribution" and
"Restricted Payment" and in SECTION 11.6, shall include payment by means of the
transfer of funds or of property and, in the event of a transfer of property,
the payment shall be deemed to be in an amount equal to the greater of the fair
market value and the book value of the property at the time of the transfer.
(j) Titles of Articles and Sections in this Agreement are for
convenience only, do not constitute part of this Agreement and neither limit nor
amplify the provisions of this Agreement, and all references in this Agreement
to Articles, Sections, subsections, paragraphs, clauses, subclauses, Schedules
or Exhibits shall refer to the corresponding Article, Section, subsection,
paragraph, clause or subclause of, or Schedule or Exhibit attached to, this
Agreement,
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unless specific reference is made to the articles, sections or other
subdivisions or divisions of, or to schedules or exhibits to, another document
or instrument.
(k) Whenever from the context it appears appropriate, the term
"Loan", including such terms as used as part of a defined term including the
term "Loan", shall mean and include a Loan made by all Lenders to the Borrowers
as well as a Lender's Proportionate Share of any Loan.
(l) Whenever the phrase "to the knowledge of the Borrower" or
words of similar import relating to the knowledge of the Borrowers (or any of
them) are used herein, such phrase shall mean and refer to the actual knowledge
of the President or chief financial officer of such Borrower.
(m) Unless otherwise specified herein, any Lien created or
purported to be created hereby or by or pursuant to any Loan Documents in favor
of the Administrative Agent and each payment made to the Administrative Agent,
is and shall be deemed to have been created in favor of the Administrative
Agent, for its benefit as the Administrative Agent and for the Ratable benefit
of the Lenders, or made to and received by the Administrative Agent for the
Ratable benefit of the Lenders, as the case may be.
(n) Whenever in this Agreement or any other Loan Document the
word "stock" or "capital stock" or other similar word or phrase is used in
connection with a Loan Party or any Subsidiary of a Loan Party referring to
equity ownership interests in such Loan Party or such Subsidiary, such word or
phrase shall also be deemed to include a reference to member interests, each
reference to "corporation" with reference to a Loan Party or any Subsidiary of a
Loan Party shall also be deemed to include a reference to limited liability
companies and each reference to "certificate of incorporation" or "articles of
incorporation" or "bylaws" with reference to a Loan Party or any Subsidiary of a
Loan Party shall also be deemed to include a reference to "certificate of
formation" and "operating agreement" or other constituent documents of a limited
liability company.
SECTION 1.3 Exhibits and Schedules. All Exhibits and Schedules
attached hereto are by reference made a part hereof.
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ARTICLE 2
REVOLVING CREDIT FACILITY
SECTION 2.1 Revolving Credit Loans. Upon the terms and subject
to the conditions of, and in reliance upon the representations and warranties
made under, this Agreement, each Lender agrees, severally, but not jointly, to
make Revolving Credit Loans to the Borrowers from time to time from the
Effective Date to but not including the Termination Date, as requested or deemed
requested by the Borrowers in accordance with the terms of SECTION 2.2, in
amounts equal to such Lender's Proportionate Share of each Revolving Credit Loan
requested or deemed requested hereunder up to an aggregate amount at any one
time outstanding equal to such Lender's Proportionate Share of the Borrowing
Base; PROVIDED, HOWEVER, that no Borrowing shall exceed the Loan Availability at
the time and the aggregate principal amount of all outstanding Loans (after
giving effect to the Revolving Credit Loans requested or deemed requested) shall
not exceed the Borrowing Base. It is expressly understood and agreed that the
Lenders may and at present intend to use the Borrowing Base as a maximum ceiling
on Loans made to the Borrowers; PROVIDED, HOWEVER, that it is agreed that should
the aggregate outstanding amount of such Loans exceed the ceiling so determined
or any other limitation set forth in this Agreement, such Loans shall
nevertheless constitute Secured Obligations and, as such, shall be entitled to
all benefits thereof and security therefor. The principal amount of any
Revolving Credit Loan which is repaid may be reborrowed by the Borrowers,
subject to the terms and conditions of this Agreement, in accordance with the
terms of this Section 2.1. The Administrative Agent's and each Lender's books
and records reflecting the date and the amount of each Revolving Credit Loan and
each repayment of principal thereof shall constitute prima facie evidence of the
accuracy of the information contained therein, subject to the provisions of
SECTION 4.5.
SECTION 2.2 Manner of Borrowing. Borrowings shall be made as
follows:
(a) Requests for Borrowing.
(i) Base Rate Revolving Credit Loans. A request for
the Borrowing of Base Rate Revolving Credit Loans shall be
made, or shall be deemed to be made, in the following manner:
(A) with respect to any Loans to be made on
the Effective Date, which shall be Base Rate Loans,
the Borrowers' representative shall give the
Administrative Agent the Initial Notice of Borrowing
at least two Business Days prior to the proposed date
of the Borrowing, and, with respect to each
subsequent Borrowing, the Borrowers may request a
Base Rate Revolving Credit Loan by giving the
Administrative Agent a Notice of Borrowing, before
noon on the proposed date of the Borrowing, PROVIDED
that if such notice is received after noon on the
proposed date of Borrowing, the proposed Borrowing
may be postponed by the Administrative Agent to the
next Business Day;
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(B) whenever a check or other item is
presented to a Disbursing Bank for payment against a
Controlled Disbursement Account in an amount greater
than the then available balance in such account, such
Disbursing Bank shall, and is hereby irrevocably
authorized by the Borrowers to, give the
Administrative Agent notice thereof, which notice
shall be deemed to be a request for a Base Rate
Revolving Credit Loan on the date of such notice in
an amount equal to the excess of such check or other
item over such available balance, and such request
shall be irrevocable;
(C) unless payment is otherwise made by the
Borrowers, the becoming due of any amount required to
be paid under this Agreement or any of the Notes as
interest shall be deemed to be a request for a Base
Rate Revolving Credit Loan on the due date in the
amount required to pay such interest, and such
request shall be irrevocable;
(D) unless payment is otherwise made by the
Borrowers, a becoming due of any other Secured
Obligation shall be deemed to be a request for a Base
Rate Revolving Credit Loan on the due date in the
amount then so due, and such request shall be
irrevocable; and
(E) the receipt by the Administrative Agent
of notification from FCC to the effect that a payment
has been made under a Letter of Credit or Letter of
Credit Guarantee and that the Borrowers have failed
to reimburse FCC therefor in accordance with the
terms of ARTICLE 3, shall be deemed to be a request
for a Base Rate Revolving Credit Loan on the date
such notification is received in the amount of such
payment which is so unreimbursed.
(ii) Eurodollar Rate Revolving Credit Loans. At any
time after the Effective Date, and so long as no Default or
Event of Default has occurred and is continuing, the Borrowers
may request a Eurodollar Rate Revolving Credit Loan by giving
the Administrative Agent a Notice of Borrowing (which notice
shall be irrevocable) not later than 11:30 a.m. on the date
three Business Days before the day on which the requested
Eurodollar Rate Revolving Credit Loan is to be made. The
Borrowers may direct the Administrative Agent to apply the
proceeds of a Eurodollar Rate Revolving Credit Loan to Secured
Obligations as described in SECTIONS 2.2(A)(I)(B), (C), (D)
and (E) and the Administrative Agent shall comply with such
direction to the extent that proceeds of a Borrowing of
Eurodollar Rate Revolving Credit Loans are available to be so
applied and in such case, no duplicative Borrowing of Base
Rate Revolving Credit Loans will be deemed to have been
requested.
(iii) Notification of Lenders. In the case of each
Eurodollar Rate Revolving Credit Loan and, unless the
Administrative Agent has elected to make a Swingline Loan to
the Borrowers pursuant to SECTION 2A.2, in the case of each
Base Rate Loan, the Administrative Agent shall promptly notify
the Lenders of any Notice of Borrowing given or deemed given
pursuant to this SECTION 2.2(A) by
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12:00 noon on the proposed Borrowing date (in the case of Base
Rate Loans) or by 3:00 p.m. three Business Days before the
proposed Borrowing date (in the case of Eurodollar Rate
Loans). If the Administrative Agent does so notify the
Lenders, then not later than 1:30 p.m. on the proposed
Borrowing date, each Lender will make available to the
Administrative Agent, for the account of the Borrowers, at the
Administrative Agent's Office in funds immediately available
to the Administrative Agent, such Lender's Proportionate Share
of the Base Rate Loan or Eurodollar Rate Loan, as the case may
be.
(b) Disbursement of Loans. The Borrowers hereby irrevocably
authorize the Administrative Agent to disburse the proceeds of each Borrowing
requested, or deemed to be requested, pursuant to SECTION 2.2(A) as follows:
(i) the proceeds of each Borrowing requested under
SECTIONS 2.2(A)(I)(A) (other than the Borrowing of any Loans
made on the Effective Date) or (B) or 2.2(A)(II) shall be
disbursed by the Administrative Agent in Dollars in
immediately available funds by wire transfer to a Controlled
Disbursement Account or, in the absence of a Controlled
Disbursement Account, by wire transfer to such other account
as may be agreed upon by the Borrowers and the Administrative
Agent from time to time, and the proceeds of the Loans to be
made on the Effective Date under SECTION 2.2(A)(I)(A) shall be
disbursed in accordance with the Initial Notice of Borrowing,
(ii) the proceeds of each Borrowing deemed requested
under SECTION 2.2(A)(I)(C) or (D) shall be disbursed by the
Administrative Agent by way of direct payment of the relevant
Secured Obligation, and
(iii) the proceeds of each Borrowing deemed requested
under SECTION 2.2(A)(I)(E) shall be disbursed by the
Administrative Agent directly to FCC on behalf of the
Borrowers for application to the Reimbursement Obligations.
SECTION 2.3 Repayment. The Revolving Credit Loans will be
repaid as follows:
(a) The outstanding principal amount of all Revolving Credit
Loans is due and payable, and shall be repaid by the Borrowers, as their joint
and several obligation, in full, not later than the Termination Date and the
outstanding principal amount of any Revolving Credit Loan may be repaid by the
Borrowers at any time and from time to time prior to the Termination Date;
(b) If at any time the aggregate outstanding unpaid principal
amount of the Revolving Credit Loans exceeds the Borrowing Base in effect at
such time, but subject to the provisions of SECTION 4.7(D), the Borrowers shall
repay the Revolving Credit Loans in an amount sufficient to reduce the aggregate
unpaid principal amount of the Revolving Credit Loans by an amount equal to such
excess, together with accrued and unpaid interest on the amount so repaid to the
date of repayment; and
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(c) The Borrowers hereby instruct the Administrative Agent to
repay the Revolving Credit Loans outstanding on any day in an amount equal to
the amount received by the Administrative Agent on such day pursuant to SECTION
8.1(C); PROVIDED that payments received in excess of outstanding Revolving
Credit Loans or payments received (when no Default or Event of Default exists)
on account of Eurodollar Rate Revolving Credit Loans which would otherwise
result in prepayment of such Eurodollar Rate Revolving Credit Loans prior to the
end of the Interest Period applicable thereto may, upon the instruction of the
Borrowers to the Administrative Agent not later than 1:00 p.m. on any Business
Day, be applied to the Cash Collateral Account or any Investment Account.
Repayments pursuant to SECTION 2.3(B) or (C) shall be applied first to the Base
Rate Revolving Credit Loans and then to Eurodollar Rate Revolving Credit Loans.
SECTION 2.4 Notes. Each Lender's Revolving Credit Loans and
the joint and several obligation of the Borrowers to repay such Revolving Credit
Loans shall also be evidenced by a Revolving Credit Note payable to the order of
such Lender. Each such Note shall be dated the Effective Date (or later
"effective date" under any Assignment and Acceptance) and be duly and validly
executed and delivered by the Borrowers.
SECTION 2.5 Extension of Commitments. Upon the request of the
Borrowers, all, but not less than all, of the Lenders may, in their sole
discretion, effective as of any anniversary of the Effective Date, agree to
extend the Commitments for a period such that the Termination Date would fall on
a date that is up to but not in excess of five years after such anniversary
date. Any such extension may be effected solely by the delivery to the Borrowers
of a written notice to that effect by the Lenders, not less than 30 days prior
to such anniversary date.
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ARTICLE 2A
SWINGLINE FACILITY
SECTION 2A.1 Swingline Loans. Upon the terms and subject to the
conditions of, and in reliance upon the representations and warranties made
under, this Agreement, the Swingline Lender shall make Swingline Loans to the
Borrowers from time to time, from and after the Effective Date until the
Termination Date, as requested or deemed requested by the Borrowers in
accordance with the terms of SECTION 2A.2, up to an aggregate principal amount
of Swingline Loans at any time outstanding not to exceed the lesser of (i) the
Swingline Facility and (ii) the Borrowing Base MINUS the aggregate principal
amount of outstanding Revolving Credit Loans. The Swingline Loans will be deemed
to be usage of the Revolving Credit Facility for the purpose of calculating
availability pursuant to SECTION 2.1, but will not reduce the Swingline Lender's
obligation to lend its Proportionate Share of the remaining unused Revolving
Credit Facility. The principal amount of any Swingline Loan which is repaid may
be reborrowed by the Borrowers, subject to the terms and conditions of this
Agreement, in accordance with the terms of this SECTION 2A.1.
SECTION 2A.2 Making Swingline Loans. Requests for Swingline Loans,
which shall be Base Rate Loans and shall not be entitled to be converted into
Eurodollar Loans, shall be made not later than 1:00 p.m. on the Business Day of
the proposed Swingline Loan by delivery by telex, telegraph, telecopy or
telephone of a request therefor by Xxxxxxx to the Administrative Agent and the
Swingline Lender and shall be deemed to be made on each Settlement Date. Each
such notice (a "Swingline Loan Request") shall specify (i) the proposed
borrowing date and (ii) the amount of Swingline Loan requested (which, in the
case of deemed Settlement Date requests shall be, respectively, the Settlement
Date and the excess, if any, of the Swingline Facility over the outstanding
principal amount of Swingline Loans on the Settlement Date). Not later than 3:00
p.m. on the date specified for any Swingline Loan, the Swingline Lender shall
make available such Swingline Loan in immediately available funds to the
Administrative Agent. After the Administrative Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in ARTICLE 5, the
Administrative Agent will, and the Borrowers hereby irrevocably authorize the
Administrative Agent to, disburse the proceeds of each Swingline Loan by making
such funds available to the Borrowers by wire transfer to such account of a
Borrower as Xxxxxxx and the Administrative Agent may agree from time to time.
SECTION 2A.3 Repayment of Swingline Loans. The outstanding principal
amount of all Swingline Loans is due and payable, and shall be repaid by the
Borrowers, as their joint and several obligation, in full, not later than the
Termination Date, together with accrued and unpaid interest thereon to such
date.
SECTION 2A.4 Prepayment. If at any time the aggregate unpaid principal
amount of Swingline Loans outstanding to the Borrowers from the Swingline Lender
exceeds the amount set forth in the first sentence of SECTION 2A.1, the
Borrowers shall pay to the Administrative Agent for the account of the Swingline
Lender on demand by the Administrative Agent, an amount equal to such excess,
together with accrued and unpaid interest on the principal amount prepaid to the
date of prepayment. For the avoidance of doubt, notwithstanding the foregoing,
no
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such prepayment shall be required if the Borrowers shall have made an
appropriate prepayment in accordance with the provisions of SECTION 2.3(B).
SECTION 2A.5 Swingline Note. The Swingline Loans made by the Swingline
Lender and the obligation of the Borrowers to repay such Loans shall be
evidenced by, and be repayable in accordance with the terms of, a single
Swingline Note, made by the Borrowers payable to the order of the Swingline
Lender. The Swingline Note shall be dated the Effective Date and be duly and
validly executed and delivered by the Borrowers.
SECTION 2A.6 Settlement with Other Lenders. All payments of principal,
interest and any other amount with respect to such Swingline Loan shall be
payable to and received by the Administrative Agent for the account of the
Swingline Lender. Upon demand by the Swingline Lender, with notice thereof to
the Administrative Agent, and notwithstanding the occurrence and continuation at
the time of such demand of any Default or Event of Default, each Lender shall
make a Base Rate Revolving Credit Loan in the amount of its Commitment
Percentage of the outstanding Swingline Loans for the account of the Borrowers
or purchase a participation of such amount in each outstanding Swingline Loan,
the proceeds of which shall be paid over to the Swingline Lender and applied to
the repayment of such Swingline Loans. Any payments received by the
Administrative Agent prior to such repayment by the Lenders which in accordance
with the terms of this Agreement are to be applied to the reduction of the
outstanding principal balance of Swingline Loans shall be paid over to the
Swingline Lender and so applied.
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ARTICLE 3
LETTER OF CREDIT GUARANTEES
SECTION 3.1 Agreement to Issue. Upon the terms and subject to
the conditions of, and in reliance upon the representations and warranties made
under, this Agreement, FCC agrees to issue or cause the issuance of, including
by issuance of Letter of Credit Guarantees, for the account of any Borrower or
Subsidiary one or more Letters of Credit in accordance with this ARTICLE 3, from
time to time during the period commencing on the Effective Date and ending on
the Termination Date.
SECTION 3.2 Amounts. FCC shall not have any obligation to
issue or cause the issuance of any Letter of Credit at any time:
(a) if, after giving effect to the issuance of the requested
Letter of Credit, (i) the aggregate Letter of Credit Obligations of the
Borrowers would exceed the Letter of Credit Guarantee Facility then in effect or
(ii) the aggregate principal amount of Loans outstanding would exceed the
Borrowing Base (after reduction for the Letter of Credit Reserve in respect of
such Letter of Credit) or (iii) if no Loans are outstanding, the aggregate
Letter of Credit Obligations would exceed the Borrowing Base; or
(b) which has a term longer than one calendar year or an
expiration date after the last Business Day that is more than 30 days prior to
the Termination Date.
SECTION 3.3 Conditions. The obligation of FCC to issue any
Letter of Credit Guarantee is subject to the satisfaction of (a) the applicable
conditions precedent contained in ARTICLE 5 and (b) the following additional
conditions precedent in a manner satisfactory to the Administrative Agent and
FCC:
(i) the Borrowers shall have delivered to FCC and the
Administrative Agent at such times and in such manner as FCC
or the Administrative Agent may prescribe, a Reimbursement
Agreement and such other documents as may be required pursuant
to the terms thereof, and the form of the proposed Letter of
Credit, all of which shall be satisfactory in form and
substance, as completed, to the Issuing Bank, FCC and the
Administrative Agent; and
(ii) as of the date of issuance, no law, rule or
regulation, or order of any court, arbitrator or governmental
authority having jurisdiction or authority over FCC shall
purport by its terms to enjoin or restrain FCC or commercial
financing entities, generally, from issuing guarantees,
including guarantees of letter of credit obligations, of the
type and in the amount of the proposed Letter of Credit
Guarantee or the proposed Letter of Credit Guarantee
specifically.
SECTION 3.4 Issuance of Letter of Credit Guarantees.
(a) Request for Issuance. A Borrower shall give the Issuing
Bank, FCC and the Administrative Agent written notice of such Borrower's request
for the issuance of a Letter of Credit no later than six Business Days prior to
the proposed date of issuance. Such notice shall
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be irrevocable and shall be accompanied by a completed form of letter of credit
application in a form acceptable to the Issuing Bank specifying at least the
name of the Subsidiary (if other than such Borrower) which will appear as the
account party on the face of such Letter of Credit, the original face amount of
the Letter of Credit requested, the effective date (which date shall be a
Business Day) of issuance of such requested Letter of Credit, whether the Letter
of Credit may be drawn in a single or in multiple draws, the date on which such
requested Letter of Credit is to expire (which date shall be a Business Day
earlier than the 30th day prior to the Termination Date), the purpose for which
the Letter of Credit is to be issued and the beneficiary of the Letter of
Credit. The Borrower shall attach to such notice the form of the Letter of
Credit that the Borrower requests be issued.
(b) Responsibilities of the Administrative Agent; Issuance.
The Administrative Agent shall determine, as of the Business Day immediately
preceding the requested effective date of issuance of a Letter of Credit set
forth in the notice from the Borrowers pursuant to SECTION 3.4(A), the amount of
Letter of Credit Availability. If (i) the form of requested Letter of Credit
delivered by the Borrowers to the Administrative Agent is acceptable to FCC and
the Administrative Agent in their sole, reasonable discretion, (ii) the amount
of the Letter of Credit Guarantee necessary to procure the issuance by the
Issuing Bank of such Letter of Credit is less than or equal to the Letter of
Credit Availability and (iii) the Administrative Agent has received a
certificate from the Borrowers stating that the applicable conditions set forth
in ARTICLE 5 have been satisfied, then FCC will join in the application for such
Letter of Credit or otherwise cause the Issuing Bank to issue the requested
Letter of Credit.
(c) Notice of Issuance. Promptly after the issuance of any
Letter of Credit supported by a Letter of Credit Guarantee, FCC or the Issuing
Bank shall give the Administrative Agent written or facsimile notice, or
telephonic notice confirmed promptly thereafter in writing, of the issuance of
such Letter of Credit, and the Administrative Agent shall give each Lender a
periodic written report, not less frequently than monthly, of each such Letter
of Credit outstanding as of the date thereof, the amount available to be drawn
thereunder and the expiration date thereof.
(d) No Extension or Amendment. FCC shall not cause any Letter
of Credit to be extended or amended unless the requirements of this SECTION 3.4
are met as though a new Letter of Credit were being requested and issued.
SECTION 3.5 Duties of FCC. The rights and obligations of the
Issuing Bank in connection with any Letter of Credit shall be governed by the
Reimbursement Agreement for such Letter of Credit and in no event shall the
Administrative Agent or any Lender have any liability or obligation to any Loan
Party or its Subsidiaries for any failure or refusal or delay by the Issuing
Bank to issue, or error in issuing, any Letter of Credit. Any action taken or
omitted to be taken by FCC under or in connection with any Letter of Credit
Guarantee, if taken or omitted in the absence of gross negligence or willful
misconduct, shall not result in any liability of FCC to any Lender or relieve
any Lender of its obligations hereunder to FCC. In determining whether to pay
under any Letter of Credit Guarantee, FCC shall have no obligation to confirm
that the Issuing Bank acted properly in honoring any drawing under the related
Letter of Credit and shall be entitled to rely on the Issuing Bank's demand for
payment as sufficient evidence of the Issuing Bank's entitlement thereto.
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SECTION 3.6 Payment of Reimbursement Obligations.
(a) Payment to Issuing Bank, FCC. Notwithstanding any
provisions to the contrary in any Reimbursement Agreement, the Borrowers agree,
jointly and severally, for the benefit of FCC and the other Lenders, to
reimburse the Issuing Bank for any drawings (whether partial or full) under each
Letter of Credit on demand and agree to pay to the Issuing Bank the amount of
all other Reimbursement Obligations and other amounts payable to the Issuing
Bank under or in connection with such Letter of Credit in accordance with the
Reimbursement Agreement. If FCC shall pay any amount under any Letter of Credit
Guarantee, the Borrowers shall, jointly and severally, unless the Borrowers
shall have already paid the amount in respect of which payment was made under
such Letter of Credit Guarantee to the Issuing Bank in accordance with a
Reimbursement Agreement, pay to FCC on the first Business Day following such
payment, an amount equal to the amount of the payment made by FCC under such
Letter of Credit Guarantee, together with interest on such amount for the period
from FCC's payment under the applicable Letter of Credit Guarantee, until
repayment in full of such amount, at the interest rate then applicable to Base
Rate Revolving Credit Loans. So long as FCC remains unpaid, it shall be
subrogated to all rights and remedies of (i) the Issuing Bank under the related
Reimbursement Agreement and (ii) any beneficiary of such Letter of Credit whose
claims against the account party on such Letter of Credit have been satisfied
with proceeds of drawing under such Letter of Credit.
(b) Recovery or Avoidance of Payments. In the event any
payment by or on behalf of the Borrowers with respect to any Letter of Credit
(or any Reimbursement Obligation relating thereto) or any Letter of Credit
Guarantee received by FCC, the Issuing Bank or by the Administrative Agent and
distributed by the Administrative Agent to the Lenders on account of their
respective participations therein, is thereafter set aside, avoided or recovered
from FCC, the Issuing Bank or the Administrative Agent in connection with any
receivership, liquidation or bankruptcy proceeding, the Lenders shall, upon
demand by the Administrative Agent, pay to the Administrative Agent, for the
account of the Administrative Agent, FCC or the Issuing Bank, as the case may
be, their respective Proportionate Shares of such amount set aside, avoided or
recovered together with interest at the rate required to be paid by the
Administrative Agent, FCC or the Issuing Bank upon the amount required to be
repaid by it.
SECTION 3.7 Participations.
(a) Purchase of Participations. Immediately upon the Effective
Date as to Letters of Credit outstanding on the Effective Date and immediately
upon issuance by the Issuing Bank of any other Letter of Credit, each Lender
shall be deemed to have irrevocably and unconditionally purchased and received
without recourse or warranty, an undivided interest and participation in the
Letter of Credit Obligations thereunder, equal to such Lender's Proportionate
Share thereof (including, without limitation, all obligations of the Borrowers
with respect thereto, other than amounts owing to FCC or for the account of the
Issuing Bank under SECTION 4.2(E), and any security therefor or guaranty
pertaining thereto).
(b) Sharing of Letter of Credit Payments. In the event that
FCC makes a payment under any Letter of Credit Guarantee and shall not have been
repaid such amount pursuant to SECTION 3.6, then the Borrowers shall be deemed
to have requested a Base Rate
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Revolving Credit Loan in the amount of such payment and, notwithstanding the
occurrence or continuance of a Default or Event of Default at the time of such
payment, each Lender shall be absolutely obligated to make its Proportionate
Share of such Loan available to the Administrative Agent for disbursement as
provided by SECTION 2.2(B) or to purchase a participation in the payment made by
FCC under any such Letter of Credit Guarantee.
(c) Sharing of Reimbursement Obligation Payments. Whenever FCC
receives a payment from or on behalf of the Borrowers or the Issuing Bank on
account of a Reimbursement Obligation as to which the Administrative Agent has
previously received for the account of FCC payment from a Lender pursuant to
this SECTION 3.7, FCC shall promptly pay to the Administrative Agent, for the
benefit of such Lender, such Lender's Proportionate Share of the amount of such
payment from the Borrowers or the Issuing Bank in Dollars. Each such payment
shall be made by FCC on the Business Day on which FCC receives immediately
available funds from the Borrowers or the Issuing Bank pursuant to the
immediately preceding sentence, if received prior to 11:00 a.m. on such Business
Day, and otherwise on the next succeeding Business Day.
(d) Documentation. Upon the request of any Lender, the
Administrative Agent shall furnish to such Lender copies of any Letter of
Credit, Reimbursement Agreement, Letter of Credit Guarantee or application for
any Letter of Credit and such other documentation as to Letters of Credit as may
reasonably be requested by such Lender.
(e) Obligations Irrevocable. The obligations of each Lender to
make payments to the Administrative Agent with respect to any Letter of Credit
or Letter of Credit Guarantee in respect thereof and its participation therein
pursuant to the provisions of this SECTION 3.7 or otherwise and the obligations
of the Borrowers to make payments to FCC, the Issuing Bank or to the
Administrative Agent, for the account of Lenders, shall be irrevocable, shall
not be subject to any qualification or exception whatsoever and shall be made in
accordance with the terms and conditions of this Agreement (assuming, in the
case of the obligations of the Lenders to make such payments, that the Letter of
Credit has been issued in accordance with SECTION 3.4), including, without
limitation, any of the following circumstances:
(i) Any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(ii) The existence of any claim, set-off, defense or
other right which the Borrowers (or any of them) may have at
any time against a beneficiary named in a Letter of Credit or
any transferee of any Letter of Credit (or any Person for whom
any such transferee may be acting), any Lender, FCC, the
Issuing Bank or any other Person, whether in connection with
this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including
any underlying transactions between the Borrowers or any other
Person and the beneficiary named in any Letter of Credit);
(iii) Any draft, certificate or any other document
presented under the Letter of Credit upon which payment has
been made in good faith and according to
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its terms proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) The surrender or impairment of any Collateral or
any other security for the Secured Obligations or the
performance or observance of any of the terms of any of the
Loan Documents;
(v) The occurrence of any Default or Event of
Default; or
(vi) FCC's, the Issuing Bank's or the Administrative
Agent's failure to deliver the notice provided for in SECTION
3.4(C).
SECTION 3.8 Indemnification, Exoneration.
(a) Indemnification. In addition to amounts payable as
elsewhere provided in this ARTICLE 3, the Borrowers, jointly and severally,
agree to protect, indemnify, pay and save harmless the Lenders, FCC, the Issuing
Bank and the Administrative Agent from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
attorneys' fees) which any Lender, FCC, the Issuing Bank or the Administrative
Agent may incur or be subject to as a consequence, directly or indirectly, of
(i) the issuance of any Letter of Credit, other than
as a result of its gross negligence or willful misconduct, as
determined by a court of competent jurisdiction, or
(ii) the failure of the Issuing Bank to honor a
drawing under any Letter of Credit as a result of any act or
omission, whether rightful or wrongful, of any present or
future de jure or de facto governmental authority (all such
acts or omissions being hereinafter referred to collectively
as "Government Acts").
(b) Assumption of Risk by the Borrowers. As among the
Borrowers, the Lenders, FCC, the Issuing Bank and the Administrative Agent, the
Borrowers assume all risks of the acts and omissions of, or misuse of any of the
Letters of Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, subject to the provisions of
the applications for the issuance of Letters of Credit, the Lenders, FCC, the
Issuing Bank and the Administrative Agent shall not be responsible for:
(i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any
Person in connection with the application for and issuance of
and presentation of drafts with respect to any of the Letters
of Credit, even if it should prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or
forged;
(ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason;
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(iii) the failure of the beneficiary of any Letter of
Credit to comply duly with conditions required in order to
draw upon such Letter of Credit;
(iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in
cipher;
(v) errors in interpretation of technical terms;
(vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing
under any Letter of Credit or of the proceeds thereof;
(vii) the misapplication by the beneficiary of any
Letter of Credit of the proceeds of any drawing under such
Letter of Credit; or
(viii) any consequences arising from causes beyond
the control of the Lenders, FCC, the Issuing Bank or the
Administrative Agent, including, without limitation, any
Government Acts.
None of the foregoing shall affect, impair or prevent the vesting of any of the
Administrative Agent's rights or powers under this SECTION 3.8.
(c) Exoneration. In furtherance and extension, and not in
limitation, of the specific provisions set forth above, any action taken or
omitted by the Administrative Agent, FCC, the Issuing Bank or any Lender under
or in connection with any of the Letters of Credit or any related certificates,
if taken or omitted in good faith, shall not result in any liability of any
Lender, FCC, the Issuing Bank or the Administrative Agent to the Borrowers or
relieve any Borrower of any of its obligations hereunder to any such Person.
SECTION 3.9 Supporting Letter of Credit; Cash Collateral
Account. Upon the occurrence of an Event of Default or, if, notwithstanding the
provisions of SECTION 3.2(B), any Letter of Credit is outstanding on the
Termination Date, then on or prior to the Termination Date, the Borrowers shall,
as their joint and several obligation, promptly on demand by the Administrative
Agent, deposit with the Administrative Agent, for the ratable benefit of the
Lenders, with respect to each Letter of Credit then outstanding, as the
Administrative Agent shall specify, either (a) a standby letter of credit (a
"Supporting Letter of Credit") in form and substance satisfactory to the
Administrative Agent, issued by an issuer satisfactory to the Administrative
Agent in its sole and absolute judgment in an amount equal to 105% of the
greatest amount for which such Letter of Credit may be drawn, under which
Supporting Letter of Credit the Administrative Agent shall be entitled to draw
amounts necessary to reimburse the Lenders for payments made by the Lenders
under the related Letter of Credit Guarantee or under any reimbursement or
guaranty agreement with respect thereto, or (b) Cash Collateral in an amount
necessary to reimburse the Administrative Agent and the Lenders for payments
made by the Administrative Agent and the Lenders under the related Letter of
Credit Guarantee or under any reimbursement or guaranty agreement with respect
thereto. Such Supporting Letter of Credit or Cash Collateral shall be held by
the Administrative Agent for the benefit of the Lenders, as security for, and to
provide for the payment of, the Reimbursement Obligations. In addition, the
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Administrative Agent may at any time after such Event of Default or the
Termination Date apply any or all of such Cash Collateral to the payment of any
or all of the Secured Obligations then due and payable. The Cash Collateral
shall be deposited in the Cash Collateral Account or an Investment Account and
shall be administered in accordance with the provisions of SECTION 4.15.
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ARTICLE 4
GENERAL LOAN PROVISIONS
SECTION 4.1 Interest.
(a)(i) Base Rate Revolving Credit Loans. Subject to the
provisions of SECTION 4.1(C), the Borrowers will pay interest on the unpaid
principal amount of each Base Rate Revolving Credit Loan, for each day from the
day such Loan is made (or is converted to a Base Rate Loan) until such Loan is
paid (whether at maturity, by reason of acceleration, or otherwise) or is
converted to a Loan of a different Type, at a rate per annum equal to the sum of
(i) the Applicable Margin and (ii) the Base Rate, payable monthly in arrears as
it accrues on each Interest Payment Date.
(ii) Eurodollar Rate Revolving Credit Loans. Subject to the
provisions of SECTION 4.1(C), the Borrowers will pay interest on the unpaid
principal amount of each Eurodollar Rate Revolving Credit Loan for the
applicable Interest Period at a rate per annum equal to the sum of (i) the
Applicable Margin and (ii) the Eurodollar Rate, payable on the last day of such
Interest Period and, if such Interest Period is longer than three months, at
three-month intervals during such Interest Period.
(iii) Swingline Loans. Subject to the provisions of SECTION
4.1(C), the Borrowers will pay interest on the unpaid principal amount of each
Swingline Loan for each day from the day such Loan is made until such Loan is
paid (whether at maturity, by reason of acceleration or otherwise) at a rate per
annum equal to the sum of (i) the Applicable Margin and (ii) the Base Rate,
payable monthly in arrears as it accrues on each Interest Payment Date.
(b) Other Secured Obligations. The Borrowers will, to the
extent permitted by Applicable Law, pay interest on the unpaid principal amount
of any Secured Obligation that is due and payable other than the Loans in
accordance with SECTIONS 4.1(A) or (C), as applicable, as if such Secured
Obligation were a Base Rate Loan.
(c) Default Rate. If a payment default pursuant to SECTION
12.1(A) shall occur and be continuing or there shall occur and be continuing,
uncured and unwaived for 30 days, any other Event of Default, at the election of
the Required Lenders, the unpaid principal amount of the Loans and other Secured
Obligations shall no longer bear interest in accordance with the terms of
SUBSECTION 4.1(A) OR (B), as applicable, but shall bear interest for each day
from the date of such payment default or the 30th day after such other Event of
Default until such payment default or other Event of Default shall have been
cured or waived at a rate per annum equal to the sum of (i) the Default Margin
and (ii) the rate otherwise applicable to such Loan, payable on demand. The
interest rate provided for in the preceding sentence shall, to the extent
permitted by Applicable Law, apply to and accrue on the amount of any judgment
entered with respect to any Secured Obligation and shall continue to accrue at
such rate during any proceeding described in SECTION 12.1(G) or (H).
(d) Calculation of Interest. The interest rates provided for
in SECTIONS 4.1(A), (B) and (C) shall be computed on the basis of a year of 360
days and the actual number of days
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elapsed. Each interest rate determined with reference to the Base Rate shall be
adjusted automatically as of the opening of business on the effective date of
each change in the Base Rate.
(e) Maximum Rate. It is not intended by the Lenders, and
nothing contained in this Agreement or the Notes shall be deemed, to establish
or require the payment of a rate of interest in excess of the maximum rate
permitted by Applicable Law (the "Maximum Rate"). If, in any month, the
Effective Interest Rate, absent such limitation, would have exceeded the Maximum
Rate, then the Effective Interest Rate for that month shall be the Maximum Rate,
and, if in future months, the Effective Interest Rate would otherwise be less
than the Maximum Rate, then the Effective Interest Rate shall remain at the
Maximum Rate until such time as the amount of interest paid hereunder equals the
amount of interest which would have been paid if the same had not been limited
by the Maximum Rate. In the event that, upon payment in full of the Secured
Obligations, the total amount of interest paid or accrued under the terms of
this Agreement is less than the total amount of interest which would have been
paid or accrued if the Effective Interest Rate (without regard to any limitation
hereunder) had at all times been in effect, then the Borrowers shall, to the
extent permitted by Applicable Law, pay to the Lenders an amount equal to the
excess, if any, of (i) the lesser of (A) the amount of interest which would have
been charged if the Maximum Rate had, at all times, been in effect and (B) the
amount of interest which would have accrued had the Effective Interest Rate
(without reference to any limitation hereunder), at all times, been in effect
and (ii) the amount of interest actually paid or accrued under this Agreement.
In the event the Lenders receive, collect or apply as interest any sum in excess
of the Maximum Rate, such excess amount shall be applied to the reduction of the
principal balance of the Secured Obligations, and if no such principal is then
outstanding, such excess or part thereof remaining, shall be paid to the
Borrowers. For the purposes of computing the Maximum Rate, to the extent
permitted by applicable law, all interest and charges, discounts, amounts,
premiums or fees deemed to constitute interest under applicable law, shall be
amortized, prorated, allocated and spread in substantially equal parts
throughout the full term of this Agreement. The provisions of this SECTION
4.1(E) shall be deemed to be incorporated into every Loan Document (whether or
not any provision of this SECTION 4.1(E) is specifically referred to therein).
SECTION 4.2 Certain Fees.
(a) Administrative Agent Fee. For administration and other
services performed by the Administrative Agent in connection with its continuing
administration of this Agreement, the Borrowers, jointly and severally, shall
pay to the Administrative Agent, for its own account, and not for the account of
the Lenders, an annual fee in accordance with the provisions of a separate
letter agreement between the Borrowers and the Administrative Agent.
(b) Unused Commitment Fee. In connection with and as
consideration for the holding available for the use of the Borrowers hereunder
the full amount of the Commitments, the Borrowers, jointly and severally, will
pay a fee to the Administrative Agent, for the Ratable benefit of the Lenders,
for each day from the Effective Date until the Termination Date, in an amount
equal to 0.375% per annum of the Unused Commitments for such day, SUBJECT,
HOWEVER to quarterly adjustment in accordance with the pricing matrix attached
hereto as ANNEX B, on the dates specified for adjustments to the Applicable
Margin. "Unused Commitments" means an amount equal to the aggregate Commitments,
LESS the aggregate
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outstanding principal amount of Loans, other than any Swingline Loan, LESS the
total amount of Letter of Credit Obligations, in each case on the date of
determination. Such fee shall be payable monthly in arrears on each Interest
Payment Date and on the date of any permanent reduction in the aggregate
Commitments.
(c) Arrangement Fee. As compensation for structuring and
arranging the credit facilities available hereunder, on the Effective Date the
Borrowers, jointly and severally, shall pay to FleetBoston Xxxxxxxxx Xxxxxxxx
Inc. ("FRSI"), for its own account, an arrangement fee in accordance with the
provisions of a separate letter agreement between the Borrowers and FRSI.
(d) Closing Fee. As compensation for structuring and approving
the credit facilities available hereunder, on the Effective Date the Borrowers,
jointly and severally, shall pay to the Administrative Agent for the Ratable
benefit of the Lenders a closing fee at the rate of 0.25% of each such Lender's
Commitment.
(e) Letter of Credit Fees. The Borrowers, jointly and
severally, agree to pay to the Administrative Agent through its Treasury and
International Services Group:
(i) for the Ratable benefit of the Lenders, Letter of
Credit fees on each Letter of Credit or Letter of Credit
Guarantee equal to the Applicable Margin per annum (or, in the
case of commercial or documentary Letters of Credit or related
Letter of Credit Guarantees, such Applicable Margin minus
0.50%) applicable to Eurodollar Rate Loans on the date of
issuance of such Letter of Credit, payable quarterly in
arrears on the first day of each January, April, July and
October on the average daily Letter of Credit Amount of such
Letters of Credit outstanding during the preceding Fiscal
Quarter;
(ii) for the account of the Issuing Bank, the
standard fees and charges of the Issuing Bank for issuing,
administering, amending, renewing, paying and canceling and
otherwise administering letters of credit, as and when
assessed as to any Letters of Credit; and
(iii) for the account of FCC, an additional fronting
fee at a rate of 0.125% per annum of the Letter of Credit
Amount of each Letter of Credit, payable quarterly in arrears
on the first day of each January, April, July and October, on
the average daily Letter of Credit Amounts of all Letters of
Credit from time to time outstanding from the Issuing Bank
during the preceding Fiscal Quarter.
(f) General. All fees provided for in this SECTION 4.2 and
otherwise in this Agreement or any other Loan Document, shall be fully earned
when due and payable and, except as otherwise set forth herein or required by
applicable law, shall not be subject to refund or rebate. All such fees are for
compensation for services and are not, and shall not be deemed to be, interest
or a charge for the use of money. Fees payable pursuant to the foregoing
subsections (b) and (e) shall be calculated based on a year of 360 days and the
actual number of days elapsed.
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SECTION 4.3 Manner of Payment.
(a) Except as otherwise expressly provided in SECTION 8.1(C),
each payment (including prepayments) by the Borrowers on account of the
principal of or interest on the Loans or of any other amounts payable to the
Administrative Agent or the Lenders under this Agreement or any Note or other
Loan Document shall be made not later than 12:00 noon on the date specified for
payment under this Agreement to the Administrative Agent, at the Administrative
Agent's Office, in Dollars, in immediately available funds and shall be made
without any setoff, counterclaim or deduction whatsoever. Any payment received
after such time but before 2:00 p.m. on such day shall be deemed a payment on
such date for the purposes of SECTION 12.1, but for all other purposes shall be
deemed to have been made on the next succeeding Business Day.
(b) The Borrowers hereby irrevocably authorize each Lender and
each Affiliate of such Lender and each participant herein to charge any account
of a Borrower maintained with such Lender or such Affiliate or participant with
such amounts as may be necessary from time to time to pay any Secured
Obligations (whether or not owed to such Lender, Affiliate or participant) which
are not paid when due.
SECTION 4.4 General. If any payment under this Agreement or
any Note shall be specified to be made on a day which is not a Business Day, it
shall be made on the next succeeding day which is a Business Day and such
extension of time shall in such case be included in computing interest, if any,
in connection with such payment.
SECTION 4.5 Loan Accounts; Statements of Account.
(a) Each Lender shall open and maintain on its books a loan
account in Xxxxxxx'x name (each, a "Loan Account" and collectively, the "Loan
Accounts"). Each such Loan Account shall show as debits thereto each Loan made
under this Agreement by such Lender to the Borrowers and as credits thereto all
payments received by such Lender and applied to principal of such Loans, so that
the balance of the Loan Account at all times reflects the principal amount due
such Lender from the Borrowers.
(b) The Administrative Agent shall maintain on its books a
control account for the Borrowers in which shall be recorded (i) the amount of
each disbursement made hereunder, (ii) the amount of any principal or interest
due or to become due from the Borrowers hereunder, and (iii) the amount of any
sum received by the Administrative Agent hereunder from or on behalf of the
Borrowers and each Lender's share therein.
(c) The entries made in the accounts pursuant to SUBSECTIONS
(A) and (B) shall be prima facie evidence, in the absence of manifest error, of
the existence and amounts of the obligations of the Borrowers therein recorded
and in case of discrepancy between such accounts, in the absence of manifest
error, the accounts maintained pursuant to SUBSECTION (B) shall be controlling.
(d) The Administrative Agent will account separately to the
Borrowers monthly with a statement of Loans, charges and payments made to and by
the Borrowers pursuant to this Agreement, and such accounts rendered by the
Administrative Agent shall be
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deemed final, binding and conclusive, save for manifest error, unless the
Administrative Agent is notified by the Borrowers in writing to the contrary
within 30 days of the date the account to the Borrowers was so rendered. Such
notice by the Borrowers shall be deemed an objection to only those items
specifically objected to therein. Failure of the Administrative Agent to render
such account shall in no way affect the rights of the Administrative Agent or of
the Lenders hereunder.
SECTION 4.6 Reduction of Commitments; Termination of
Agreement.
(a) Reduction of Commitments.
(i) The Borrowers shall have the right, at any time
and from time to time, upon at least seven days' prior
irrevocable, written notice to the Administrative Agent, to
reduce permanently and Ratably in part the Commitments;
PROVIDED, HOWEVER, that any such partial reduction shall be in
an amount equal to $5,000,000 or any larger integral, multiple
of $1,000,000 and shall not reduce the aggregate Commitments
below an amount equal to the sum of the Letter of Credit
Reserve PLUS the Rent Reserve PLUS any Additional Reserves. As
of the date of reduction set forth in such notice, the
Commitments shall be permanently reduced to the amount stated
in the Borrowers' notice (and each Lender's Commitment shall
be reduced Ratably) for all purposes herein, and the Borrowers
shall pay the amount necessary to reduce the amount of the
outstanding Loans to any amount that does not exceed the
Borrowing Base (as reduced), together with accrued interest on
any amounts so prepaid and an early termination fee in an
amount equal to (A) 1% of the amount of such reduction if
effected prior to the first anniversary of the Effective Date
or (B) 1/2 of 1% of the amount of such reduction if effected
on or after the first anniversary of the Effective Date but
prior to the second anniversary of the Effective Date.
(ii) The aggregate Commitments shall be automatically
reduced to zero on the Termination Date.
(iii) The aggregate Commitments shall be reduced as
provided in SECTION 4.9.
(iv) The Commitments or any portion thereof
terminated or reduced pursuant to this SECTION 4.6 may not be
reinstated.
(b) Termination of Agreement. The Borrowers shall have the
right, at any time, to terminate this Agreement upon not less than 10 Business
Days' prior written notice, which notice shall specify the effective date of
such termination. Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender thereof. On the date specified in such notice, such
termination shall be effected, PROVIDED, that the Borrowers shall, on or prior
to such date, pay to the Administrative Agent, for its account and the account
of the Lenders, in same day funds, an amount equal to all Secured Obligations
(other than with respect to Letter of Credit Obligations) outstanding on such
date, including, without limitation, all (i) accrued interest thereon, (ii) all
accrued fees provided for hereunder, (iii) any amounts payable to the
Administrative Agent or the Lenders pursuant to SECTIONS 4.10, 4.15, 15.2, 15.3,
15.14 and 15.23, and, in addition thereto, shall deliver to the Administrative
Agent, in respect of each
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outstanding Letter of Credit, either a Supporting Letter of Credit or Cash
Collateral as provided in SECTION 3.9, and (iv) if such termination occurs prior
to the first anniversary of the Effective Date, an early termination fee in an
amount equal to 1% of the amount of the Commitments so terminated or if such
termination occurs on or after the first anniversary of the Effective Date but
prior to the second anniversary of the Effective Date, an early termination fee
in an amount equal to 1/2 of 1% of the amount of the Commitments so terminated,
PROVIDED, that such fee shall be payable only if contemporaneously with such
termination and repayment, the Borrowers (or any of them) issue additional Debt
in a private placement, a public offering, or to one or more institutional
lenders, PROVIDED FURTHER, that if Loan Availability has been reduced by 10% or
more during the six-month period preceding such termination as a result of the
Administrative Agent's having, without the agreement of Xxxxxxx, reduced any
advance rate specified in the definition "Borrowing Base" or declared in the
exercise of its reasonable credit judgment any otherwise Eligible Inventory or
Eligible Receivables to be ineligible, then such early termination fee will not
be payable notwithstanding that any such other Debt is incurred. Additionally,
the Borrowers shall provide the Administrative Agent and the Lenders with
indemnification in form and substance satisfactory to the Administrative Agent
in its reasonable judgment with respect to such customary matters as the
Administrative Agent and the Lenders shall reasonably require. Following a
notice of termination as provided for in this SECTION 4.6(B) and upon payment in
full of the amounts specified in this SECTION 4.6(B), and execution and delivery
of any required indemnification, this Agreement shall be terminated and the
Administrative Agent, the Lenders and the Borrowers shall have no further
obligations to any other party hereto, except for the obligations to the
Administrative Agent and the Lenders pursuant to SECTION 15.12 hereof, which
shall survive any termination of this Agreement.
SECTION 4.7 Making of Loans.
(a) Nature of Obligations of Lenders to Make Loans. The
obligations of the Lenders under this Agreement to make the Loans are several
and are not joint or joint and several.
(b) Assumption by Administrative Agent. Subject to the
provisions of SECTION 4.8 and notwithstanding the occurrence or continuance of a
Default or Event of Default or other failure of any condition to the making of
Loans hereunder subsequent to the Loans to be made on the Effective Date, unless
the Administrative Agent shall have received notice from a Lender prior to a
proposed Borrowing date that such Lender will not make available to the
Administrative Agent such Lender's Proportionate Share of the Loan to be
borrowed on such date, the Administrative Agent may assume that such Lender will
make such Proportionate Share available to the Administrative Agent in
accordance with SECTION 2.2(A), and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrowers on such date a
corresponding amount. If and to the extent a Lender shall not make its
Proportionate Share of any Loan available to the Administrative Agent, and the
Administrative Agent has made a corresponding amount available to the Borrowers,
such Lender, on the one hand, and the Borrowers, jointly and severally on the
other hand, severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount (the "Make-Whole Amount"), together with
interest thereon for each day from the date such amount is made available to the
Borrowers until the date such amount is repaid to the Administrative Agent at
(i) the Federal Funds Rate if repaid by the Lender or (ii) the Effective
Interest Rate or, if lower, subject to SECTION 4.1(F), the
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Maximum Rate, if repaid by the Borrowers. If such Lender shall repay to the
Administrative Agent such corresponding amount, the amount so repaid shall
constitute such Lender's Proportionate Share of the Loan made on such Borrowing
date for purposes of this Agreement. The Administrative Agent shall not be
required to make any Loan as to which it shall have received notice by a Lender
of such Lender's intention not to make its Ratable Share of such Loan available
to the Administrative Agent. The failure of any Lender to make its Proportionate
Share of any Loan available shall not (without regard to whether the Borrowers
shall have returned the amount thereof to the Administrative Agent in accordance
with this SECTION 4.7) relieve it or any other Lender of its obligation, if any,
hereunder to make its Proportionate Share of the Loan available on such
Borrowing date, but no Lender shall be responsible for the failure of any other
Lender to make its Proportionate Share of a Loan available on the Borrowing
date.
(c) Delegation of Authority to Administrative Agent. Without
limiting the generality of SECTION 14.1, each Lender expressly authorizes the
Administrative Agent to determine on behalf of such Lender (i) any reduction or
increase of advance rates applicable to the Borrowing Base, so long as such
advance rates do not at any time exceed the rates set forth in the Borrowing
Base definition as in effect on the Agreement Date, (ii) the creation or
elimination of Additional Reserves and (iii) whether or not Inventory or
Receivables shall be deemed to constitute Eligible Inventory or Eligible
Receivables. Any withdrawal of authorization under this SECTION 4.7(C) shall not
affect the validity of any Loans made prior to the effectiveness thereof.
(d) Overadvances. Notwithstanding anything to the contrary
contained elsewhere in this SECTION 4.7 or this Agreement or the other Loan
Documents and whether or not a Default or Event of Default exists at the time,
the Administrative Agent may in its discretion require all Lenders to honor
requests or deemed requests by the Borrowers for Loans at a time that an
Overadvance Condition exists or which would result in an Overadvance Condition
and each Lender shall be obligated to continue to make its Proportionate Share
of any such Overadvance Loan up to a maximum amount outstanding equal to its
Commitment, so long as such Overadvance is not known by the Administrative Agent
to exceed $3,000,000 or to exist for more than five consecutive Business Days or
more than 10 days in any Fiscal Year.
SECTION 4.8 Settlement Among Lenders.
(a) Revolving Credit Loans. It is agreed that each Lender's
Net Outstandings are intended by the Lenders to be equal at all times to such
Lender's Ratable Share of the aggregate principal amount of all Revolving Credit
Loans outstanding. Notwithstanding such agreement, the several and not joint
obligation of each Lender to make its Ratable Share of Loans in accordance with
the terms of this Agreement and each Lender's right to receive its Ratable Share
of principal payments on Revolving Credit Loans, the Lenders agree that, in
order to facilitate the administration of this Agreement and the Loan Documents,
settlement among them may take place on a periodic basis in accordance with the
provisions of this SECTION 4.8.
(b) Settlement Procedures. To the extent and in the manner
hereinafter provided in this SECTION 4.8, settlement among the Lenders as to
Base Rate Revolving Credit Loans may occur periodically on Settlement Dates
determined from time to time by the Administrative Agent, which may occur before
or after the occurrence or during the continuance
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of a Default or Event of Default and whether or not all of the conditions set
forth in SECTION 5.2 have been met. On each Settlement Date payments shall be
made by or to FCC and the other Lenders in the manner provided in this SECTION
4.8 in accordance with the Settlement Report delivered by the Administrative
Agent pursuant to the provisions of this SECTION 4.8 in respect of such
Settlement Date, so that as of each Settlement Date, and after giving effect to
the transactions to take place on such Settlement Date, each Lender's Net
Outstandings shall equal such Lender's Ratable Share of the Revolving Credit
Loans.
(i) Selection of Settlement Dates. If the
Administrative Agent elects, in its discretion, but subject to
the consent of FCC, to settle accounts among the Lenders with
respect to principal amounts of Base Rate Revolving Credit
Loans less frequently than each Business Day, then the
Administrative Agent shall designate periodic Settlement Dates
which may occur on any Business Day after the Effective Date;
PROVIDED, that (A) the Administrative Agent shall designate as
a Settlement Date any Business Day which is an Interest
Payment Date, (B) a Settlement Date shall occur not less often
than every five Business Days, and (C) settlements with
respect to each Eurodollar Rate Revolving Credit Loan shall
take place on the Borrowing date for such Loan, on the last
day of the Interest Period applicable thereto and on any other
date during such Interest Period on which interest is payable
thereon. The Administrative Agent shall designate a Settlement
Date by delivering to each Lender a Settlement Report not
later than 12:00 noon on the proposed Settlement Date, which
Settlement Report shall be with respect to the period
beginning on the next preceding Settlement Date and ending on
such designated Settlement Date.
(ii) Non-Ratable Loans and Payments. Between
Settlement Dates, the Administrative Agent shall request and
FCC may (but shall not be obligated to) advance to the
Borrowers out of FCC's own funds, the entire principal amount
of any Base Rate Loan requested or deemed requested pursuant
to SECTION 2.2(A) (any such Base Rate Loan being referred to
as a "Non-Ratable Loan"). The making of each Non-Ratable Loan
by FCC shall be deemed to be a purchase by FCC of a 100%
participation in each other Lender's Proportionate Share of
such Non-Ratable Loan. All payments of principal, interest and
any other amount with respect to such Non-Ratable Loan shall
be payable to and received by the Administrative Agent for the
account of FCC. Upon demand by FCC, with notice thereof to the
Administrative Agent, each other Lender shall pay to FCC, as
the repurchase of such participation, an amount equal to 100%
of such Lender's Proportionate Share of the principal amount
of such Non-Ratable Loan. Notwithstanding the provisions of
SECTION 4.16, any payments received by the Administrative
Agent between Settlement Dates which in accordance with the
terms of this Agreement are to be applied to the reduction of
the outstanding principal balance of the Revolving Credit
Loans, shall be paid over to and retained by FCC for such
application, and such payment to and retention by FCC shall be
deemed, to the extent of each other Lender's Proportionate
Share of such payment, to be a purchase by each such other
Lender of a participation in the Revolving Credit Loans
(including the repurchase of participations in Non-Ratable
Loans) held by FCC. Upon demand by another Lender, with notice
thereof to the Administrative Agent, FCC shall pay to the
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Administrative Agent, for the account of such other Lender, as
a repurchase of such participation, an amount equal to such
other Lender's Proportionate Share of any such amounts (after
application thereof to the repurchase of any participations of
FCC in such other Lender's Proportionate Share of any
Non-Ratable Loans) paid only to FCC by the Administrative
Agent.
(iii) Settlement. On each Settlement Date each Lender
shall transfer to the Agent and the Agent shall transfer to
each Lender such amounts as are necessary to insure that,
after giving effect to all such transfers, each Lender's Net
Outstandings are equal to such Lender's Proportionate Share of
the aggregate principal amount of all Revolving Credit Loans
then outstanding.
(iv) Return of Payments. If any amounts received by
FCC in respect of the Secured Obligations are later required
to be returned or repaid by FCC to the Borrowers or any other
obligor or their respective representatives or successors in
interest, whether by court order, settlement or otherwise, in
excess of the FCC's Proportionate Share of all such amounts
required to be returned by all Lenders, each other Lender
shall, upon demand by FCC with notice to the Administrative
Agent, pay to the Administrative Agent for the account of FCC,
an amount equal to the excess of such Lender's Proportionate
Share of all such amounts required to be returned by all
Lenders over the amount, if any, returned directly by such
Lender.
(v) Payments to Administrative Agent, Lenders.
(A) Payment by any Lender to the
Administrative Agent pursuant to this SECTION 4.8
shall be made not later than 1:00 p.m. on the
Business Day such payment is due, PROVIDED that if
such payment is due on demand by another Lender, such
demand is made on the paying Lender not later than
10:00 a.m. on such Business Day. Payment by the
Administrative Agent to any Lender shall be made by
wire transfer, promptly following the Administrative
Agent's receipt of funds for the account of such
Lender and in the type of funds received by the
Administrative Agent, PROVIDED that if the
Administrative Agent receives such funds (A) at or
prior to 1:00 p.m., the Administrative Agent shall
pay such funds to such Lender by 2:00 p.m. on such
Business Day or (B) after 1:00 p.m., the
Administrative Agent shall pay such funds to such
Lender prior to 2:00 p.m. on the following Business
Day. If a demand for payment is made after the
applicable time set forth above, the payment due
shall be made by 2:00 p.m. on the first Business Day
following the date of such demand.
(B) If a Lender shall, at any time, fail to
make any payment to the Administrative Agent required
hereunder, the Administrative Agent may, but shall
not be required to, retain payments that would
otherwise be made to such Lender hereunder and apply
such payments to such Lender's defaulted obligations
hereunder, at such time, and in such order, as the
Administrative Agent may elect in its sole
discretion.
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(C) With respect to the payment of any funds
under this SECTION 4.8(B), whether from the
Administrative Agent to a Lender or from a Lender to
the Administrative Agent, the party failing to make
full payment when due pursuant to the terms hereof
shall, upon demand by the other party, pay such
amount together with interest on such amount at the
Federal Funds Rate.
(c) Settlement of Other Secured Obligations. All other amounts
received by the Administrative Agent on account of, or applied by the
Administrative Agent to the payment of, any Secured Obligation owed to the
Lenders (including, without limitation, fees payable to the Lenders pursuant to
SECTIONS 4.2(B) and (E) and proceeds from the sale of, or other realization
upon, all or any part of the Collateral following an Event of Default) that are
received by the Administrative Agent at or prior to 1:00 p.m. on a Business Day
will be paid by the Administrative Agent to each Lender on the same Business
Day, and any such amounts that are received by the Administrative Agent after
1:00 p.m. will be paid by the Administrative Agent to each Lender on the
following Business Day. Unless otherwise stated herein, the Administrative Agent
shall distribute to each Lender such Lender's Proportionate Share of fees
payable to the Lenders pursuant to SECTIONS 4.2(B) and (E) and shall distribute
to each Lender such Lender's Proportionate Share (or if different, such Lender's
share based upon the amount of the Secured Obligations then owing to each
Lender) of the proceeds from the sale of, or other realization upon, all or any
part of the Collateral following an Event of Default.
SECTION 4.9 Mandatory Prepayments. The Borrowers shall
permanently reduce the Commitments (Ratably) by an amount equal to any amount
that would otherwise constitute "Net Available Cash" as defined in the Senior
Note Indenture and be required by the terms thereof to be applied to the
prepayment of the Senior Notes. To the extent necessary to comply with the
provisions of SECTION 2.3(B) after giving effect to such reduction, the
Borrowers shall also prepay the Loans. Any such prepayment pursuant to this
SECTION 4.9 shall be applied first to Base Rate Loans to the extent thereof and
then to Eurodollar Rate Loans. If any payments are received which result in
prepayment of Eurodollar Rate Loans prior to the end of the applicable Interest
Period, the Borrowers shall also pay any amounts due pursuant to SECTION 4.10.
SECTION 4.10 Payments Not at End of Interest Period; Failure
to Borrow. If for any reason any payment of principal with respect to any
Eurodollar Rate Loan is made on any day prior to the last day of the Interest
Period applicable to such Eurodollar Rate Loan or, after having given a Notice
of Borrowing with respect to any Eurodollar Rate Loan or a Notice of Conversion
or Continuation with respect to any Loan to be continued as or converted into a
Eurodollar Rate Loan, such Loan is not made or is not continued as or converted
into a Eurodollar Rate Loan due to the Borrowers' failure to borrow or to
fulfill the applicable conditions set forth in ARTICLE 5, the Borrowers shall
pay to each Lender, an amount equal to such Lender's costs and expenses incurred
as a result of such failure, including in connection with obtaining deposits to
fund its Ratable Share of such new (or continued or converted) Loan and
redeploying such deposits. The Borrowers shall pay such amount upon presentation
by the Administrative Agent of a statement setting forth the amount and the
applicable Lender's calculation thereof in reasonable detail, which statement
shall be deemed true and correct absent manifest error.
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SECTION 4.11 Notice of Conversion or Continuation. Whenever
the Borrowers desire, subject to the provisions of SECTIONS 4.12 and 4.13, to
convert an outstanding Loan into a Loan or Loans of a different Type or to
continue all or a portion of an outstanding Eurodollar Rate Loan for a
subsequent Interest Period, the Borrowers shall notify the Administrative Agent
in writing (which notice shall be irrevocable) by telecopy or electronic mail
not later than 11:30 a.m. on the date two Business Days before the day on which
such proposed conversion or continuation is to be effective (and such effective
date of any continuation shall be the last day of the Interest Period for the
Eurodollar Rate Loan). Each such notice (a "Notice of Conversion or
Continuation") shall (i) identify the Loan to be converted or continued, the
aggregate outstanding principal balance thereof and, if a Eurodollar Rate Loan,
the last day of the Interest Period applicable to such Loan, (ii) specify the
effective date of such conversion or continuation, (iii) specify the principal
amount of such Loan to be converted or continued and, if converted, the Type or
Types into which the same is to be converted, and (iv) the Interest Period to be
applicable to the Eurodollar Rate Loan as converted or continued, and shall be
immediately followed by a written confirmation thereof by the Borrowers in a
form acceptable to the Administrative Agent, PROVIDED that if such written
confirmation differs in any respect from the action taken by the Lenders, the
records of the Administrative Agent shall control absent manifest error.
SECTION 4.12 Conversion or Continuation. Provided that no
Event of Default shall have occurred and be continuing (but subject to the
provisions of SECTIONS 4.11 and 4.13), the Borrowers may request that all or any
part of any outstanding Loan be converted into a Loan or Loans of a different
Type or be continued as a Loan or Loans of the same Type, in the same aggregate
principal amount, on any Business Day (which, in the case of continuation of a
Eurodollar Rate Loan, shall be the last day of the Interest Period applicable to
such Loan), upon notice (which notice shall be irrevocable) given in accordance
with SECTION 4.11.
SECTION 4.13 Duration of Interest Periods; Maximum Number of
Eurodollar Rate Loans; Minimum Increments.
(a) Subject to the provisions of the definition "Interest
Period," the duration of each Interest Period applicable to a Eurodollar Rate
Loan shall be as specified in the applicable Notice of Borrowing or Notice of
Conversion or Continuation. The Borrowers may elect a subsequent Interest Period
to be applicable to any Eurodollar Rate Loan by giving a Notice of Conversion or
Continuation with respect to such Loan in accordance with SECTION 4.11.
(b) If the Administrative Agent does not receive a notice of
election in accordance with SECTION 4.11 with respect to the continuation of
Eurodollar Rate Loan within the applicable time limits specified in said SECTION
4.11, or if, when such notice must be given, an Event of Default exists or such
Type of Loan is not available, the Borrowers shall be deemed to have elected to
convert such Eurodollar Rate Loan in whole into a Base Rate Loan on the last day
of the Interest Period therefor.
(c) Notwithstanding the foregoing, the Borrowers may not
select an Interest Period that would end, but for the provisions of the
definition "Interest Period," after the Termination Date.
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(d) In no event shall there be more than six Eurodollar Rate
Loans outstanding hereunder at any time. For the purpose of this SUBSECTION (D),
each Loan having a distinct Interest Period shall be deemed to be a separate
Loan hereunder.
(e) Each Eurodollar Rate Loan shall be in a minimum amount of
$1,000,000 or an integral multiple of $250,000 in excess thereof.
SECTION 4.14 Changed Circumstances.
(a) If the introduction of or any change in or in the
interpretation of (in each case, after the date hereof) any law or regulation
makes it unlawful, or any Governmental Authority asserts, after the date hereof,
that it is unlawful, for any Lender to perform its obligations hereunder to make
Eurodollar Rate Loans or to fund or maintain Eurodollar Rate Loans hereunder,
such Lender shall notify the Administrative Agent of such event and the
Administrative Agent shall notify the Borrowers of such event, and the right of
the Borrowers to select Eurodollar Rate Loans for any subsequent Interest Period
or in connection with any subsequent conversion of any Loan shall be suspended
until the Administrative Agent shall notify the Borrowers that the circumstances
causing such suspension no longer exist, and the Borrowers shall forthwith
prepay in full all Eurodollar Rate Loans then outstanding and shall pay all
interest accrued thereon through the date of such prepayment or conversion,
unless the Borrowers, within three Business Days after such notice from the
Administrative Agent, request the conversion of all Eurodollar Rate Loans then
outstanding into Base Rate Loans; PROVIDED, that if the date of such repayment
or proposed conversion is not the last day of the Interest Period applicable to
such Eurodollar Rate Loans, the Borrowers shall also pay any amount due pursuant
to SECTION 4.10.
(b) If the Administrative Agent shall, at least one Business
Day before the date of any requested Borrowing or the effective date of any
conversion or continuation of an existing Loan to be made or continued as or
converted into a Eurodollar Rate Loan (each such requested Borrowing made and
Loan to be converted or continued, a "Pending Loan"), notify the Borrowers that
the Eurodollar Rate will not adequately reflect the cost to the Lenders of
making or funding such Pending Loan as a Eurodollar Rate Loan or that the
Interbank Offered Rate is not determinable from any interest rate reporting
service of recognized standing, then the right of the Borrowers to select
Eurodollar Rate Loan for such Pending Loan, any subsequent Loan or in connection
with any subsequent conversion or continuation of any Loan shall be suspended
until the Administrative Agent shall notify the Borrowers that the circumstances
causing such suspension no longer exist, and each Pending Loan and each such
subsequent Loan requested to be made, continued or converted shall be made or
continued as or converted into a Base Rate Loan.
SECTION 4.15 Cash Collateral Account; Investment Accounts.
(a) Cash Collateral Account. The Borrowers shall establish a
Cash Collateral Account in which to deposit Collateral consisting of cash or
Cash Equivalents from time to time
(i) representing payments received pursuant to
SECTION 2.3(C) in excess of then outstanding Loans or on
account of Eurodollar Rate Loans which would
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otherwise result in repayment of such Loans prior to the end
of the Interest Period applicable thereto,
(ii) with respect to Letter of Credit Obligations (x)
at the request of the Administrative Agent upon the occurrence
of an Event of Default, or (y) for the purposes set forth in
SECTION 4.6 in the event of termination of this Agreement, or
(iii) for any other purpose as may be agreed between
the Administrative Agent and the Borrowers to provide security
for the Secured Obligations.
On the last day of the applicable Interest Period as to any amounts deposited to
the Cash Collateral Account pursuant to CLAUSE (I) above or if a drawing under a
Letter of Credit occurs with respect to any amounts deposited to the Cash
Collateral Account pursuant to CLAUSE (II) above, the Borrowers hereby authorize
the Administrative Agent to use the monies deposited in the Cash Collateral
Account to make payment to the payee with respect to such Loan or drawing. The
Cash Collateral Account shall be in the name of the Administrative Agent and the
Administrative Agent shall have sole dominion and control over, and sole access
to, the Cash Collateral Account. Neither any Borrower nor any Person claiming on
behalf of or through any Borrower shall have any right to withdraw any of the
funds held in the Cash Collateral Account. The Borrowers agree that they will
not at any time (x) sell or otherwise dispose of any interest in the Cash
Collateral Account or any funds held therein or (y) create or permit to exist
any Lien upon or with respect to the Cash Collateral Account or any funds held
therein, except as provided in or contemplated by this Agreement. The
Administrative Agent shall exercise reasonable care in the custody and
preservation of any funds held in the Cash Collateral Account and shall be
deemed to have exercised such care if such funds are accorded treatment
substantially equivalent to that which the Administrative Agent accords other
funds deposited with the Administrative Agent, it being understood that the
Administrative Agent shall not have any responsibility for taking any necessary
steps to preserve rights against any parties with respect to any funds held in
the Cash Collateral Account. Subject to the right of the Administrative Agent to
withdraw funds from the Cash Collateral Account as provided herein, the
Administrative Agent will, so long as no Default or Event of Default shall have
occurred and be continuing, from time to time invest funds on deposit in the
Cash Collateral Account, reinvest proceeds of any such investments which may
mature or be sold, and invest interest or other income received from any such
investments, in each case, in Cash Equivalents, as the Borrowers may direct
prior to the occurrence of a Default or Event of Default and as the
Administrative Agent may select after the occurrence and during the continuance
of a Default or Event of Default. Such proceeds, interest and income which are
not so invested or reinvested in Cash Equivalents shall be deposited and held by
the Administrative Agent in the Cash Collateral Account. The Administrative
Agent makes no representation or warranty as to, and shall not be responsible
for, the rate of return, if any, earned in any Cash Collateral. Any earnings on
Cash Collateral shall be held as additional Cash Collateral on the terms set
forth in this SECTION 4.15.
(b) Investment Accounts. The Borrowers may from time to time
establish one or more Investment Accounts with the Administrative Agent, any
Lender or any Affiliate of a Lender, for the purpose of investing in Cash
Equivalents any Cash Collateral representing payments received pursuant to
SECTION 2.3(C) in excess of then outstanding Loans or on account of Eurodollar
Rate Loans which would otherwise result in repayment of such Loans prior to the
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end of the Interest Period applicable thereto. The Borrowers hereby acknowledge
and agree that each such Investment Account shall constitute Collateral
hereunder and shall be maintained with the Administrative Agent, a Lender or
Affiliate of a Lender as security for the Secured Obligations. Notwithstanding
the foregoing, until such time as the Administrative Agent shall otherwise
instruct the Lender or the Affiliate of a Lender maintaining such account, the
Borrowers shall be entitled to direct the investment of the funds deposited
therein. The Borrowers agree that they will not at any time (x) sell or
otherwise dispose of any interest in any Investment Account or any funds held
therein other than by application thereof to any Secured Obligation, or (y)
create or permit to exist any Lien upon or with respect to any Investment
Account or any funds held therein, except as provided in or contemplated by this
Agreement. The Borrowers agree that at any time, and from time to time, at the
expense of the Borrowers, the Borrowers will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable, or that the Administrative Agent or any Lender may
request, in order to perfect and protect any security interest in any Investment
Account granted or purported to be granted hereby or to enable the Borrowers,
for their respective benefit and the benefit of the Lenders, to exercise and
enforce its rights and remedies hereunder with respect to such Investment
Account.
SECTION 4.16 Allocation of Payments from Borrowers. All monies
to be applied to the Secured Obligations, whether such monies represent
voluntary payments by the Borrowers or are received pursuant to demand for
payment or realized from any disposition of Collateral, shall be allocated among
the Administrative Agent and such of the Lenders and other holders of the
Secured Obligations as are entitled thereto (and, with respect to monies
allocated to the Lenders, on a Ratable basis unless otherwise provided in this
SECTION 4.16): (i) first, to the Swingline Lender (or to any Lender to the
extent such Lender has previously repaid such Loan) to pay principal and accrued
interest on any portion of any Swingline Loan; (ii) second, to the
Administrative Agent to pay the amount of expenses that have not been reimbursed
to the Administrative Agent by the Borrowers or the Lenders, together with
interest accrued thereon; (iii) third, to the Administrative Agent to pay any
indemnified amount that has not been paid to the Administrative Agent by the
Borrowers or the Lenders, together with interest accrued thereon; (iv) fourth,
to the Administrative Agent to pay any fees due and payable to the
Administrative Agent under this Agreement; (v) fifth, to the Lenders for any
indemnified amount that they have paid to the Administrative Agent and for any
expenses that they have reimbursed to the Administrative Agent; (vi) sixth, to
the Lenders to pay any fees due and payable to the Lenders under this Agreement;
(vii) seventh, in payment of the unpaid principal and accrued interest in
respect of the Loans and any other Secured Obligations then outstanding and held
by any Lender to be shared among the Lenders on a Ratable basis, or on such
other basis as may be agreed upon in writing by all of the Lenders (which
agreement or agreements may be entered into without notice to or the consent or
approval of the Borrowers); and (vii) eight, to the holders of the other Secured
Obligations who are not Lenders on a pro rata basis. The allocations set forth
in this SECTION 4.16 are solely to determine the rights and priorities of the
Administrative Agent and the Lenders as among themselves and may be changed by
the Administrative Agent and the Lenders without notice to or the consent or
approval of the Borrowers or any other Person. Whenever allocation is made
pursuant to this SECTION 4.16 to the holder of Secured Obligations in which
another Lender acquires a participation, the monies received by such holder
shall be shared as between such holder and such participants on a Ratable basis.
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SECTION 4.17 Borrowers' Representative. Xxxxxxx shall act
under this Agreement as the representative of all Borrowers, and each other
Borrower hereby appoints Xxxxxxx as its representative, hereunder, for all
purposes, including, without being limited to, requesting borrowings and
receiving account statements and other notices and communications to the
Borrowers (or any of them) from the Administrative Agent or any Lender. The
Administrative Agent and the Lenders may rely, and shall be fully protected in
relying, on any request for borrowing, disbursement instruction, report,
information or any other notice or communication made or given by Xxxxxxx,
whether in its own name, on behalf of any other Borrower or on behalf of "the
Borrowers," and neither the Administrative Agent nor any Lender shall have any
obligation to make any inquiry or request any confirmation from or on behalf of
any other Borrower as to the binding effect on it of any such request,
instruction, report, information, notice or communication, nor shall the joint
and several character of the Borrowers' liability for the Secured Obligations be
affected. The Administrative Agent and each Lender intend to maintain a single
Loan Account in the name of "Xxxxxxx Tire Group, Inc." hereunder and each
Borrower expressly agrees to such arrangement and confirms that such arrangement
shall have no effect on the joint and several character of its liability for the
Secured Obligations.
SECTION 4.18 Joint and Several Liability.
(a) Joint and Several Liability. The Secured Obligations shall
constitute one joint and several direct and general obligation of all of the
Borrowers. Notwithstanding anything to the contrary contained herein, each of
the Borrowers shall be jointly and severally, with each other Borrower, directly
and unconditionally liable to the Administrative Agent and the Lenders for all
Secured Obligations and shall have the obligations of co-maker with respect to
the Loans, the Notes, and the Secured Obligations, it being agreed that the
advances to each Borrower inure to the benefit of all Borrowers, and that the
Administrative Agent and the Lenders are relying on the joint and several
liability of the Borrowers as co-makers in extending the Loans hereunder. Each
Borrower hereby unconditionally and irrevocably agrees that upon default in the
payment when due (whether at stated maturity, by acceleration or otherwise) of
any principal of, or interest on, any Loan or other Secured Obligation payable
to the Administrative Agent or any Lender, it will forthwith pay the same,
without notice or demand.
(b) No Modification or Release of Obligations. No payment or
payments made by any of the Borrowers or any other Person or received or
collected by the Administrative Agent or any Lender from any of the Borrowers or
any other Person by virtue of any action or proceeding or any set-off or
appropriation or application at any time or from time to time in reduction of or
in payment of the Secured Obligations shall be deemed (except to the extent
Secured Obligations are satisfied) to modify, release or otherwise affect the
liability of each Borrower under this Agreement, which shall remain liable for
the Secured Obligations until the Secured Obligations are paid in full and the
Commitments are terminated.
SECTION 4.19 Obligations Absolute. Each Borrower agrees that
the Secured Obligations will be paid strictly in accordance with the terms of
the Loan Documents, regardless of any law, regulation or order now or hereafter
in effect in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent or any Lender with respect thereto. All Secured Obligations
shall be conclusively presumed to have been created in reliance hereon. The
liabilities under this Agreement shall be absolute and unconditional
irrespective of:
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(a) any lack of validity or enforceability of any Loan
Documents or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payments of, or
in any other term of, all or any part of the Secured Obligations, or any other
amendment or waiver thereof or any consent to departure therefrom, including,
but not limited to, any increase in the Secured Obligations resulting from the
extension of additional credit to any Borrower or otherwise;
(c) any taking, exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty for all or any of the Secured Obligations;
(d) any change, restructuring or termination of the corporate
structure or existence of any Borrower; or
(e) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, any Borrower or a guarantor.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Secured Obligations is rescinded or
must otherwise be returned by the Administrative Agent or any Lender upon the
insolvency, bankruptcy or reorganization of any Borrower or otherwise, all as
though such payment had not been made.
SECTION 4.20 Waiver of Suretyship Defenses. Each Borrower
agrees that the joint and several liability of the Borrowers provided for in
SECTION 4.18 shall not be impaired or affected by any modification, supplement,
extension or amendment or any contract or agreement to which the other Borrowers
may hereafter agree (other than an agreement signed by the Administrative Agent
and the Lenders specifically releasing such liability), nor by any delay,
extension of time, renewal, compromise or other indulgence granted by the
Administrative Agent or any Lender with respect to any of the Secured
Obligations, nor by any other agreements or arrangements whatever with the other
Borrowers or with anyone else, each Borrower hereby waiving all notice of such
delay, extension, release, substitution, renewal, compromise or other
indulgence, and hereby consenting to be bound thereby as fully and effectually
as if it had expressly agreed thereto in advance. The liability of each Borrower
is direct and unconditional as to all of the Secured Obligations, and may be
enforced without requiring the Administrative Agent or any Lender first to
resort to any other right, remedy or security. Each Borrower hereby expressly
waives promptness, diligence, notice of acceptance and any other notice with
respect to any of the Secured Obligations, the Notes, this Agreement or any
other Loan Document (other than notices expressly required in this Agreement or
by any of the Loan Documents) and any requirement that the Administrative Agent
or any Lender protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Borrower or
any other Person or any collateral, including any rights any Borrower may
otherwise have under the New York General Obligations Law.
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ARTICLE 5
CONDITIONS PRECEDENT
SECTION 5.1 Conditions Precedent to Effectiveness of
Agreement. Notwithstanding any other provision of this Agreement, this Agreement
shall not become effective nor shall the Lenders have any obligation to make any
Loans on the Effective Date unless and until the following conditions precedent
are satisfied:
(a) Documents. The Administrative Agent shall have received on
or before the Effective Date the following, each in form and substance
satisfactory to the Administrative Agent, its special counsel and the Lenders
and (except for the Notes) in sufficient copies for each Lender:
(1) Agreement. This Agreement, duly executed and
delivered by the Borrowers and the other Lenders;
(2) Notes. The Notes, each dated the Effective Date
and duly executed and delivered by the Borrowers;
(3) Articles, Bylaws and Resolutions. A certificate,
dated the Effective Date, of the Secretary or an Assistant
Secretary of each Loan Party, as to and having attached
thereto copies of the articles of incorporation and by-laws
and shareholder agreements of such Loan Party as in effect on
the Effective Date and all corporate action, including
shareholder approval, if necessary, taken by such Loan Party
and/or its shareholders to authorize the execution, delivery
and performance of this Agreement and the other Loan Documents
to which such Loan Party is a party and, in the case of each
Borrower, the Borrowings under this Agreement;
(4) Incumbency Certificates. A certificate, dated the
Effective Date, of the Secretary or an Assistant Secretary of
each Loan Party, as to the incumbency and specimen signatures
of each of the officers of such Loan Party who is authorized
to execute and deliver this Agreement or any other Loan
Document on behalf of such Loan Party or any document,
certificate or instrument to be delivered in connection with
this Agreement or the other Loan Documents to which such Loan
Party is a party and, in the case of each Borrower, to request
Borrowings under this Agreement;
(5) Good Standing Certificates. A certificate as of a
recent date evidencing the good standing of each Loan Party in
the jurisdiction of its incorporation and in each other
jurisdiction in which it is qualified as a foreign corporation
to transact business;
(6) Financing Statements. The Financing Statements to
be delivered by the Loan Parties duly executed and delivered
by the Loan Parties, and evidence satisfactory to the
Administrative Agent that the Financing Statements have been
filed in each jurisdiction where such filing may be necessary
or appropriate to
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perfect the Security Interest or, at the Administrative
Agent's discretion, in appropriate form for such filing;
(7) Landlord's Waiver. Landlord's waiver and consent
agreements duly executed on behalf of each landlord of real
property on which any Collateral is located, except to the
extent that the Rent Reserve appropriately reflects the
absence of such a waiver;
(8) Schedules of Inventory and Receivables. A
Schedule of Inventory and a Schedule of Receivables, each
prepared as of a recent date;
(9) Insurance Coverage. Certificates or binders of
insurance relating to each of the policies of insurance
covering any of the Collateral together with loss payable
clauses which comply with the terms of SECTION 8.8(B);
(10) Borrowing Base Certificate. A Borrowing Base
Certificate prepared as of January 29, 2000 duly executed and
delivered by the Financial Officer demonstrating Loan
Availability of not less than $35,000,000, after giving effect
to the Loans to be made on the Effective Date and any
transactions contemplated by this Agreement to occur on or
before the Effective Date;
(11) Notice of Borrowing. The Initial Notice of
Borrowing dated the Effective Date from the Borrowers to the
Administrative Agent requesting the Loans to be made on the
Effective Date and specifying the method of disbursement;
(12) Financial Statements. Copies of all the
financial statements referred to in SECTION 6.1(N) and meeting
the requirements thereof;
(13) Officer's Certificate. A certificate of the
President or a Vice President of Xxxxxxx stating that, to the
best of his knowledge and based on an examination sufficient
to enable him to make an informed statement, (a) all of the
representations and warranties made or deemed to be made under
this Agreement are true and correct as of the Effective Date,
both with and without giving effect to the Loans to be made on
the Effective Date and the application of the proceeds
thereof, and (b) as of the Effective Date, no Default or Event
of Default exists;
(14) Factual Certificate. A certification from an
appropriate officer of each Borrower as to such factual
matters as shall be required by the Administrative Agent;
(15) Other Loan Documents. Copies of each of the
other Loan Documents dated the Effective Date, duly executed
by the parties thereto with evidence satisfactory to the
Administrative Agent and its counsel of the due authorization,
binding effect and enforceability of each such Loan Document
on each such party and such other documents and instruments as
the Administrative Agent may reasonably request;
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(16) Legal Opinions. An opinion dated the Effective
Date of each of Xxxxxxxxx & Xxxxxxx, counsel for the
Borrowers, and of such local counsel as the Administrative
Agent shall deem necessary or desirable, opining as to such
matters in connection with this Agreement as the
Administrative Agent or its counsel may reasonably request;
(17) Fees. The Administrative Agent shall have
received from the Borrowers all of the fees payable on the
Effective Date referred to herein; and
(18) Priority. The Administrative Agent shall have
received satisfactory evidence that the Administrative Agent
(for the benefit of Lenders) has a valid and perfected first
priority security interest as of such date in all of the
Collateral, subject only to Permitted Liens.
(b) Litigation. The Administrative Agent shall have received
evidence satisfactory to it that no action, proceeding, investigation,
regulation or legislation, shall have been instituted, threatened or proposed
before any court, governmental agency or legislative body to enjoin, restrain or
prohibit, or to obtain substantial damages in respect of, or which is related to
or arises out of, this Agreement, or the consummation of the transactions
contemplated hereby, or which may otherwise have a Materially Adverse Effect.
(c) No Material Adverse Change. There shall not have occurred
any event or series of events or circumstances or group of circumstances which
individually or in the aggregate, in the sole judgment of the Administrative
Agent, would have a Materially Adverse Effect.
(d) Receipt of Funds. The Administrative Agent shall have
received and disbursed such amounts from and to each Existing Lender and New
Lender (and each such Lender shall be deemed to have purchased from or sold to
each other such Lender such interest in such Lender's Revolving Credit Loans
outstanding immediately prior to the Effective Date) as would result in each
such Lender's having Revolving Credit Loans outstanding on the Effective Date
equal to its Proportionate Share (based upon the Commitments set forth on ANNEX
A hereto) of the outstanding principal amount of such Revolving Credit Loans.
SECTION 5.2 All Loans; Letters of Credit. The obligation of
the Lenders to make (but not to continue or convert any outstanding Loan, which
shall be subject to the provisions of SECTION 4.12) any Loan hereunder,
including any Loans to be made on the Effective Date and all subsequent Loans,
and of FCC to cause the issuance of any Letter of Credit are further subject to
the following:
(a) at such time, both with and without giving effect to the
Loans to be made at such time and the application of the proceeds thereof or the
Letter of Credit Guarantee to be issued, (1) no Default or Event of Default
shall exist nor (2) shall any event have occurred or condition exist that could
reasonably be expected to have a Materially Adverse Effect, and
(b) the corporate actions of the Loan Parties referred to in
SECTION 5.1(A)(3) shall remain in full force and effect and the incumbency of
officers shall be as stated in the
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certificates of incumbency delivered pursuant to SECTION 5.1(A)(4) or as
subsequently modified and reflected in a certificate of incumbency delivered to
the Administrative Agent.
Each request or deemed request for any Borrowing or other advance or submission
of any request for any Letter of Credit hereunder shall be deemed to be a
certification by the Borrowers to the Administrative Agent and the Lenders as to
the matters set forth in SECTION 5.2(A) and (B) and the Administrative Agent and
the Lenders may, without waiving either condition, consider the conditions
specified in SECTIONS 5.2(A) and (B) fulfilled and a representation by the
Borrowers to such effect made, if no written notice to the contrary is received
by the Administrative Agent prior to the making of the Loan then to be made or
the issuance of the Letter of Credit so requested.
SECTION 5.3 Conditions as Covenants. In the event that the
Lenders permit this Agreement to become effective and make any Loans on the
Effective Date or permit FCC to issue a Letter of Credit Guarantee prior to the
satisfaction of all conditions precedent set forth in SECTION 5.1, and such
conditions are not waived in writing by the Administrative Agent, the Borrowers
shall nevertheless cause such condition or conditions to be satisfied within 30
days after the making of such Loans or the issuance of such Letter of Credit
Guarantee.
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BORROWERS
SECTION 6.1 Representations and Warranties. The Borrowers
represent and warrant to the Administrative Agent and to the Lenders as follows:
(a) Organization; Power; Qualification. Each Borrower and each
of its Subsidiaries is a corporation, duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, having the
power and authority to own its properties and to carry on its business as now
being and hereafter proposed to be conducted and is duly qualified and
authorized to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification or
authorization. The jurisdictions in which each of the Borrowers and each of
their respective Subsidiaries is qualified to do business as a foreign
corporation are listed on SCHEDULE 6.1(A).
(b) Capitalization; Shareholder Agreements. The outstanding
capital stock of the Borrowers has been duly and validly issued and is fully
paid and nonassessable, and the number and owners of such shares of capital
stock of the Borrowers are set forth on SCHEDULE 6.1(B). Except as set forth on
SCHEDULE 6.1(B), the issuance and sale of the Borrowers' capital stock have been
registered or qualified under applicable federal and state securities laws or
are exempt therefrom and there are no shareholders agreements, options,
subscription agreements or other agreements or understandings to which any
Borrower is a party in effect with respect to the capital stock of a Borrower,
including, without limitation, agreements providing for special voting
requirements or arrangements for approval of corporate actions or other matters
relating to corporate governance or restrictions on share transfer or providing
for the issuance of any securities convertible into shares of the capital stock
of any Borrower, any warrants or other rights to acquire any shares or
securities convertible into such shares, or any agreement that obligates a
Borrower, either by its terms or at the election of any other Person, to
repurchase such shares under any circumstances.
(c) Subsidiaries. SCHEDULE 6.1(C) correctly sets forth the
name of each Subsidiary of any Borrower, its jurisdiction of incorporation, the
name of its immediate parent or parents, and the percentage of its issued and
outstanding securities owned by the Borrowers or any other Subsidiary of any
Borrower. Except as set forth on SCHEDULE 6.1(C),
(i) no Subsidiary has issued any securities
convertible into shares of such Subsidiary's capital stock or
any options, warrants or other rights to acquire any shares or
securities convertible into such shares,
(ii) the outstanding stock and securities of each
Subsidiary are owned by a Borrower or a Wholly Owned
Subsidiary of a Borrower, or by a Borrower and one or more of
its Wholly Owned Subsidiaries, free and clear of all Liens,
warrants, options and rights of others of any kind whatsoever,
and
(iii) no Borrower has any Subsidiaries.
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The outstanding capital stock of each Subsidiary has been duly and validly
issued and is fully paid and nonassessable by the issuer, and the number and
owners of the shares of such capital stock are set forth on SCHEDULE 6.1(C).
(d) Authorization of Agreement, Notes, Loan Documents and
Borrowing. Each Loan Party has the right and power, and has taken all necessary
action to authorize it, to execute, deliver and perform this Agreement and each
of the Loan Documents to which it is a party in accordance with their respective
terms. This Agreement and each of the Loan Documents have been duly executed and
delivered by the duly authorized officers of each Loan Party and each is, or
when executed and delivered in accordance with this Agreement will be, a legal,
valid and binding obligation of each such Loan Party, enforceable in accordance
with its terms.
(e) Compliance of Agreement, Notes, Loan Documents and
Borrowing with Laws, Etc. Except as set forth on SCHEDULE 6.1(E), the execution,
delivery and performance of this Agreement and each of the Loan Documents in
accordance with their respective terms and the borrowings hereunder do not and
will not, by the passage of time, the giving of notice or otherwise,
(i) require any Governmental Approval or violate any
Applicable Law relating to a Borrower or any of its
Subsidiaries,
(ii) conflict with, result in a breach of or
constitute a default under the articles or certificate of
incorporation, by-laws or any shareholders' agreement of a
Borrower or any of its Subsidiaries,
(iii) conflict with, result in a breach of or
constitute a default under any material provisions of any
indenture, agreement or other instrument to which a Borrower
or any of its Subsidiaries is a party or by which a Borrower,
any of its Subsidiaries or any of any Borrower's or such
Subsidiaries' property may be bound or any Governmental
Approval relating to a Borrower or any of its Subsidiaries, or
(iv) result in or require the creation or imposition
of any Lien upon or with respect to any property now owned or
hereafter acquired by any Loan Party other than the Security
Interest.
(f) Business. Each Borrower and each Subsidiary is engaged in
the business described on SCHEDULE 6.1(F).
(g) Compliance with Law; Governmental Approvals. Except as set
forth in SCHEDULE 6.1(G), each Borrower and each of its Subsidiaries
(i) has all Governmental Approvals, including permits
relating to federal, state and local Environmental Laws,
ordinances and regulations, required by any Applicable Law for
it to conduct its business, each of which is in full force and
effect, is final and not subject to review on appeal and is
not the subject of any pending or, to the knowledge of any
Borrower, threatened attack by direct or collateral
proceeding, and
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(ii) is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable
Laws relating to it, including, without being limited to, all
Environmental Laws and all occupational health and safety laws
applicable to any Borrower, any of its Subsidiaries or their
respective properties,
except for instances of noncompliance which would not, singly or in the
aggregate, cause a Default or Event of Default or have a Materially Adverse
Effect and in respect of which appropriate reserves have been established.
(h) Title to Properties. Except as set forth in SCHEDULE
6.1(H), each Borrower and each of the Subsidiaries has valid and legal title to
or leasehold interest in all personal property, Real Estate and other assets
used in its business, including, but not limited to, those reflected on the most
recent balance sheet of the Borrowers delivered pursuant to SECTION 6.1(N).
(i) Liens. Except as set forth in SCHEDULE 6.1(I), none of the
properties and assets of any Borrower or any Subsidiary is subject to any Lien,
except Permitted Liens. Other than the Financing Statements, no financing
statement under the UCC of any State or other instrument evidencing a Lien which
names a Borrower or any Subsidiary as debtor has been filed (and has not been
terminated) in any State or other jurisdiction, and neither any Borrower nor any
Subsidiary has signed any such financing statement or other instrument (which
financing statement or other instrument has not been terminated) or any security
agreement (which security agreement has not been terminated) authorizing any
secured party thereunder to file any such financing statement or instrument,
except to perfect those Liens listed on SCHEDULE 6.1(I).
(j) Indebtedness and Guarantees. SCHEDULE 6.1(J) is a complete
and correct listing of all (i) Debt and (ii) Guarantees of each Borrower and
each of its Subsidiaries. Each Borrower and each of its Subsidiaries has
performed and is in compliance in all material respects with all of the terms of
such Debt and Guarantees and all instruments and agreements relating thereto,
and no default or event of default, or event or condition which with notice or
lapse of time, or both, would constitute such a default or event of default,
exists with respect to any such Debt or Guaranty.
(k) Litigation. Except as set forth on SCHEDULE 6.1(K), as of
the Effective Date there are no actions, suits or proceedings pending (nor, to
the knowledge of any Borrower, are there any actions, suits or proceedings
threatened, or any reasonable basis therefor) against or in any other way
relating to or affecting a Borrower or its Subsidiaries or any of their
respective properties in any court or before any arbitrator of any kind or
before or by any governmental body, EXCEPT actions, suits or proceedings of the
character normally incident to the kind of business conducted by the Borrowers
and their Subsidiaries which, if adversely determined, would not singly or in
the aggregate have a Materially Adverse Effect, and there are no strikes or
walkouts in progress, pending or contemplated relating to any labor contracts to
which a Borrower or any of its Subsidiaries is a party, relating to any labor
contracts being negotiated, or otherwise.
(l) Tax Returns and Payments. Except as set forth on SCHEDULE
6.1(L), all United States federal, state and local as well as foreign national,
provincial and local and other tax returns of each Borrower and each of its
Subsidiaries required by Applicable Law to be filed
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have been duly filed, and all United States federal, state and local and foreign
national, provincial and local and other taxes, assessments and other
governmental charges or levies upon a Borrower or any of its Subsidiaries or
their respective property, income, profits and assets which are due and payable
have been paid, except any such nonpayment which is at the time permitted under
SECTION 9.6. The charges, accruals and reserves on the books of the Borrowers
and each Subsidiary as of the Effective Date in respect of United States
federal, state and local and foreign national, provincial and local taxes for
all fiscal years and portions thereof since January 1, 1994 are in the judgment
of the Borrowers adequate, and the Borrowers know of no reason to anticipate any
additional assessments for any of such years which, singly or in the aggregate,
might have a Materially Adverse Effect.
(m) Burdensome Provisions. Except as set forth on SCHEDULE
6.1(M), neither Borrower nor any Subsidiary is a party to any indenture,
agreement, lease or other instrument, or subject to any charter or corporate
restriction, Governmental Approval or Applicable Law compliance with the terms
of which is reasonably likely to have a Materially Adverse Effect.
(n) Financial Statements.
(i) The Borrowers have furnished to the
Administrative Agent and the Lenders copies of Xxxxxxx'x (A)
consolidating and audited consolidated balance sheets as at
December 31, 1998 and the related consolidating and audited
consolidated statements of income, cash flow and shareholders
equity for the Fiscal Year then ended and (B) unaudited
consolidating and consolidated balance sheets as at November
30, 1999 and the related consolidating and consolidated
statements of income, cash flow and shareholders equity for
the eleven-month period then ended, which financial statements
present fairly and in all material respects in accordance with
GAAP the financial positions of Xxxxxxx and its Consolidated
Subsidiaries as at their respective dates, and the results of
operations of Xxxxxxx and its Consolidated Subsidiaries for
the periods then ended (except, in the case of the interim
statements, for the omission of notes and subject to normal
year-end audit adjustments).
(ii) Except as set forth on SCHEDULE 6.1(N) or as
disclosed or reflected in the financial statements described
in CLAUSE (I) above, Xxxxxxx and its Subsidiaries, taken as a
whole, have no material liabilities, contingent or otherwise.
(o) Adverse Change. Since the date of the latest financial
statements referred to in SECTION 6.1(N)(I),
(i) no material adverse change has occurred in the
business, assets, liabilities, financial condition, results of
operations or business prospects of Xxxxxxx, the other
Borrowers and their respective Subsidiaries taken as a whole,
and
(ii) no event has occurred or failed to occur which
has had, or may have, singly or in the aggregate, a Materially
Adverse Effect.
(p) ERISA. Neither any Borrower nor any Related Company
maintains or contributes to any Benefit Plan other than those listed on SCHEDULE
6.1(P). Except as set forth on
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SCHEDULE 6.1(P), and subject to correction of possible Remediable Defects, each
Benefit Plan is in substantial compliance with ERISA and the Code, including but
not limited to those provisions thereof relating to reporting and disclosure,
and neither any Borrower nor any Related Company has received any notice
asserting that a Benefit Plan is not in compliance with ERISA. No material
liability to the PBGC or to a Multiemployer Plan has been, or is expected to be,
incurred by any Borrower or any Related Company. Except as set forth on SCHEDULE
6.1(P), and subject to correction of possible Remediable Defects, each Benefit
Plan intended to qualify under Section 401(a) of the Code so qualifies and any
related trust is exempt from federal income tax under Section 501(a) of the
Code. A favorable determination letter from the IRS has been issued or applied
for with respect to each such plan and trust and nothing that is not a
Remediable Defect has occurred since the date of such determination letter that
would adversely affect such qualification or tax-exempt status. No Benefit Plan
subject to the minimum funding standards of the Code has failed to meet such
standards. Neither the Borrower or any Related Company has transferred any
pension plan liability in a transaction that could be subject to Sections 4069
or 4212(c) of ERISA. Except as set forth on SCHEDULE 6.1(P), neither any
Borrower nor any Related Company has any liability, actual or contingent, with
respect to any Benefit Plan other than to make payments to the Benefit Plan in
accordance with its terms, and there are no pending or threatened claims against
a Benefit Plan. No non-exempt prohibited transaction with the meaning of Section
4975 of the Code or Section 406 of ERISA has occurred with respect to a Benefit
Plan. Except under plans listed on SCHEDULE 6.1(P), no employee or former
employee of any Borrower or any Related Company is or may become entitled to any
benefit under a Benefit Plan that is a "welfare plan" within the meaning of
Section 3(1) of ERISA following such employee's termination of employment.
Except as set forth on SCHEDULE 6.1(P), each such welfare plan that is a group
health plan has been operated in compliance with the provision of Section 4980B
of the Code and Sections 601-609 of ERISA and any applicable provisions of state
law that are similar.
(q) Absence of Defaults. No Borrower nor any Subsidiary is in
default under its articles or certificate of incorporation or by-laws and no
event has occurred, which has not been remedied, cured or waived,
(i) which constitutes a Default or an Event of
Default, or
(ii) which constitutes, or which with the passage of
time or giving of notice, or both, would constitute, a default
or event of default by a Borrower or any of its Subsidiaries
under any material agreement (other than this Agreement) or
judgment, decree or order to which such Borrower or any of its
Subsidiaries is a party or by which such Borrower, any of its
Subsidiaries or any of such Borrower's or any of its
Subsidiaries' properties may be bound or which would require a
Borrower or any Subsidiary to make any payment under any
thereof prior to the scheduled maturity date therefor, except,
in the case only of any such agreement, for alleged defaults
which are being contested in good faith by appropriate
proceedings and with respect to which reserves in respect of a
Borrower's or such Subsidiary's reasonably anticipated
liability have been established on the appropriate books.
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(r) Accuracy and Completeness of Information.
(i) As of the Effective Date, no fact is known to the
Borrowers which has had, or is reasonably likely in the future
to have (so far as the Borrowers can reasonably foresee), a
Materially Adverse Effect which has not been set forth in the
financial statements or disclosure delivered to the
Administrative Agent and the Lenders prior to the Effective
Date. No document furnished or written statement made to the
Administrative Agent or any Lender by the Borrowers (or any of
them) prior to the Agreement Date, in connection with the
negotiation, preparation or execution of this Agreement or any
of the Loan Documents contained, except to the extent
corrected or superseded prior to the Agreement Date, any
untrue statement of a fact material to the creditworthiness of
a Borrower or omitted to state a material fact necessary in
order to make the statements contained therein not misleading.
(ii) The Borrowers have no reason to believe that any
document furnished or written statement made to the
Administrative Agent or any Lender prior to the Agreement Date
by any Person other than the Borrowers in connection with the
negotiation, preparation or execution of this Agreement or any
of the Loan Documents contained any incorrect statement of a
material fact or omitted to state a material fact necessary in
order to make the statements made, in light of the
circumstances under which they were made, not misleading, that
has not been corrected or superseded prior to the Effective
Date.
(s) Solvency. In each case after giving effect to the Debt
represented by the Loans outstanding and to be incurred and the transactions
contemplated by this Agreement, each Borrower and each of its Subsidiaries is
solvent, having assets of a fair salable value which exceeds the amount required
to pay its debts as they become absolute and matured (including contingent,
subordinated, unmatured and unliquidated liabilities), and each Borrower and
each of its Subsidiaries is able to and anticipates that it will be able to meet
its debts as they mature and has adequate capital to conduct the business in
which it is or proposes to be engaged.
(t) Receivables.
(i) Status.
(1) Each Receivable reflected in the
computations included in any Borrowing Base
Certificate meets the criteria enumerated in CLAUSES
(A) through (P) of the definition "Eligible
Receivables," except as disclosed in such Borrowing
Base Certificate or as disclosed in a timely manner
in a subsequent Borrowing Base Certificate or
otherwise in writing to the Administrative Agent.
(2) No Borrower has any knowledge of any
fact or circumstance not disclosed to the
Administrative Agent in a Borrowing Base Certificate
or otherwise in writing which would impair the
validity or collectibility of any Receivable
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of $250,000 or more or of Receivables which
(regardless of the individual amount thereof)
aggregate $500,000 or more.
(ii) Chief Executive Office. The chief executive
office of each Borrower and the books and records relating to
the Receivables are located on the Effective Date at the
address or addresses set forth on SCHEDULE 6.1(T).
(u) Inventory.
(i) Schedule of Inventory. All Inventory included in
any Schedule of Inventory or Borrowing Base Certificate
delivered to the Administrative Agent on or prior to the
Effective Date meets the criteria enumerated in CLAUSES (A)
through (G) of the definition "Eligible Inventory," except as
disclosed in such Schedule of Inventory or Borrowing Base
Certificate.
(ii) Condition. All Inventory is in good condition,
meets all standards imposed by any governmental agency, or
department or division thereof, having regulatory authority
over such goods, their use or sale, and is currently either
usable or salable in the normal course of the applicable
Borrower's business, except to the extent reserved against in
the financial statements referred to in SECTION 6.1(N) or a
Borrowing Base Certificate delivered pursuant to SECTION 5.1.
(iii) Location. All Inventory is located at a
Permitted Inventory Location or is in transit to a Permitted
Inventory Location.
(v) Corporate and Fictitious Names. Except as otherwise
disclosed on SCHEDULE 6.1(V), during the five-year period preceding the
Agreement Date, neither any Borrower nor any predecessor thereof has been known
as or used any corporate or fictitious name other than the corporate name of
such Borrower on the Effective Date.
(w) Federal Reserve Regulations. Neither any Borrower nor any
of its Subsidiaries is engaged, principally or as one of its important
activities, in the business of extending credit for the purpose of "purchasing"
or "carrying" any "margin stock" (as each of the quoted terms is defined or used
in Regulation U of the Board of Governors of the Federal Reserve System).
(x) Investment Company Act. No Borrower is an "investment
company" or a company "controlled" by an "investment company" (as each of the
quoted terms is defined or used in the Investment Company Act of 1940, as
amended).
(y) Employee Relations. The Borrowers and each Subsidiary have
stable work forces in place and none of them is, except as set forth on SCHEDULE
6.1(Y), party to any collective bargaining agreement nor has any labor union
been recognized as the representative of a Borrower's or any of its
Subsidiaries' employees, and the Borrowers know of no pending, threatened or
contemplated strikes, work stoppage or other labor disputes involving a
Borrower's or any Subsidiary's employees.
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(z) Proprietary Rights. Each Borrower owns or has the right to
use all Proprietary Rights necessary or desirable in the conduct of its business
as conducted on the Agreement Date and as expected on the Agreement Date to be
conducted in the future. To the best of the Borrowers' knowledge, none of such
Proprietary Rights infringes on or conflicts with any other Person's property,
and no other Person's property infringes on or conflicts with the Proprietary
Rights.
(aa) Trade Names. All trade names or styles under which any
Loan Party sells Inventory or creates Receivables, or to which instruments in
payment of Receivables are made payable, all as of the Effective Date, are
listed on SCHEDULE 6.1(AA).
(bb) Bank Accounts. Attached hereto as SCHEDULE 6.1(BB) is a
complete and correct list of all checking accounts, depository accounts, special
deposit accounts and other accounts maintained by any Borrower or Subsidiary
with any commercial bank or savings bank as of the Effective Date and each such
account (except any account indicated by an asterisk (*)) is either (i) subject
to an Agency Account Agreement or (ii) subject to directions from the account
holder to the institution maintaining such account, in form and substance
approved by the Administrative Agent, to transfer all collected funds therein
daily to the Administrative Agent.
(cc) Equipment. All machinery, equipment, fixtures and other
tangible property (other than Inventory) of each Borrower and their respective
Subsidiaries, other than obsolete equipment no longer used or useful in the
business of the Borrowers and their Subsidiaries, is in good order and repair,
ordinary wear and tear excepted.
(dd) Real Property. No Borrower nor any Subsidiary owns any
Real Estate nor leases any Real Estate other than that described on SCHEDULE
6.1(DD) and other than Real Estate acquired or leased after the Effective Date.
(ee) Year 2000 Compliant. Each Borrower and each Subsidiary is
Year 2000 Compliant.
SECTION 6.2 Survival of Representations and Warranties, Etc.
All representations and warranties set forth in this ARTICLE 6 and all
statements contained in any certificate, financial statement, or other
instrument, delivered by or on behalf of the Borrowers pursuant to or in
connection with this Agreement or any of the Loan Documents (including, but not
limited to, any such representation, warranty or statement made in or in
connection with any amendment thereto) shall constitute representations and
warranties made under this Agreement. All representations and warranties made
under this Agreement shall be made or deemed to be made at and as of the
Agreement Date and at and as of the Effective Date, except that representations
and warranties which, by their terms are applicable only to one such date shall
be deemed to be made only at and as of such date. All representations and
warranties made or deemed to be made under this Agreement shall survive and not
be waived by the execution and delivery of this Agreement, any investigation
made by or on behalf of the Administrative Agent or any Lender or any borrowing
hereunder.
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ARTICLE 7
SECURITY INTEREST
SECTION 7.1 Security Interest.
(a) Xxxxxxx, Xxxxxxx and CPW hereby confirm the mortgage,
pledge and assignment to the Administrative Agent under the Existing Loan
Agreement of the Collateral and the creation in favor of the Administrative
Agent of a continuing security interest in the Collateral, all as security for
the Secured Obligations, and each Borrower hereby mortgages, pledges and assigns
all of the Collateral to the Administrative Agent, for the benefit of itself as
Administrative Agent, the Lenders and Affiliates of the Lenders, and grants to
the Administrative Agent, for the benefit of itself as Administrative Agent, the
Lenders and Affiliates of the Lenders, a continuing security interest in, and a
continuing Lien upon, all of the Collateral as security for the payment,
observance and performance of the Secured Obligations.
(b) As additional security for all of the Secured Obligations,
the Borrowers grant to the Administrative Agent, for the benefit of itself as
Administrative Agent, the Lenders and Affiliates of the Lenders, a security
interest in, and assigns to the Administrative Agent, for the benefit of itself
as Administrative Agent and the Lenders and Affiliates of the Lenders, all of
the Borrowers' right, title and interest in and to, any deposits or other sums
at any time credited by or due from each Lender and each Affiliate of a Lender
to a Borrower, or credited by or due from any participant of any Lender to a
Borrower, with the same rights therein as if the deposits or other sums were
credited by or due from such Lender. Each Borrower hereby authorizes each Lender
and each Affiliate of such Lender and each participant to pay or deliver to the
Administrative Agent, for the account of the Lenders, without any necessity on
the Administrative Agent's or any Lender's part to resort to other security or
sources of reimbursement for the Secured Obligations, at any time during the
continuation of any Event of Default or in the event that the Administrative
Agent, on behalf of the Lenders, should make demand for payment hereunder in
accordance with the terms hereof, then and without further notice to any
Borrower (such notice being expressly waived), any of the aforesaid deposits
(general or special, time or demand, provisional or final) or other sums for
application to any Secured Obligation, irrespective of whether any demand has
been made or whether such Secured Obligation is mature, and the rights given the
Administrative Agent, the Lenders, their Affiliates and participants hereunder
are cumulative with such Person's other rights and remedies, including other
rights of set-off. The Administrative Agent will promptly notify the Borrowers
of its receipt of any such funds for application to the Secured Obligations, but
failure to do so will not affect the validity or enforceability thereof. The
Administrative Agent may give notice of the above grant of a security interest
in and assignment of the aforesaid deposits and other sums, and authorization,
to, and make any suitable arrangements with, any Lender, any such Affiliate of
any Lender or participant for effectuation thereof, and each Borrower hereby
irrevocably appoints the Administrative Agent as its attorney to collect any and
all such deposits or other sums to the extent any such payment is not made to
the Administrative Agent or any Lender by such Lender, Affiliate or participant.
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SECTION 7.2 Continued Priority of Security Interest.
(a) The Security Interest granted by the Borrowers shall at
all times be valid, perfected and enforceable against each Borrower and all
third parties in accordance with the terms of this Agreement, as security for
the Secured Obligations, and the Collateral shall not at any time be subject to
any Liens that are prior to, on a parity with or junior to the Security
Interest, other than Permitted Liens.
(b) The Borrowers shall, at their sole cost and expense, take
all action that may be necessary or desirable, or that the Administrative Agent
may reasonably request, so as at all times to maintain the validity, perfection,
enforceability and rank of the Security Interest in the Collateral in conformity
with the requirements of SECTION 7.2(A), or to enable the Administrative Agent
and the Lenders to exercise or enforce their rights hereunder, including, but
not limited to:
(i) paying all taxes, assessments and other claims
lawfully levied or assessed on any of the Collateral, except
to the extent that such taxes, assessments and other claims
constitute Permitted Liens,
(ii) obtaining, after the Agreement Date, landlords',
mortgagees', bailees', warehousemen's or processors' releases,
subordinations or waivers (except as to premises reflected in
the Rent Reserve), and using all reasonable efforts to obtain
mechanics' releases, subordinations or waivers,
(iii) delivering to the Administrative Agent, for the
benefit of the Lenders, endorsed or accompanied by such
instruments of assignment as the Administrative Agent may
specify, and stamping or marking, in such manner as the
Administrative Agent may specify, any and all chattel paper,
instruments, letters and advices of guaranty and documents
evidencing or forming a part of the Collateral, and
(iv) executing and delivering financing statements,
pledges, designations, hypothecations, notices and assignments
in each case in form and substance satisfactory to the
Administrative Agent relating to the creation, validity,
perfection, maintenance or continuation of the Security
Interest under the UCC or other Applicable Law.
(c) The Administrative Agent is hereby authorized to file one
or more financing or continuation statements or amendments thereto without the
signature of or in the name of a Borrower for any purpose described in SECTION
7.2(B). The Administrative Agent will give the Borrowers notice of the filing of
any such statements or amendments, which notice shall specify the locations
where such statements or amendments were filed. A carbon, photographic,
xerographic or other reproduction of this Agreement or of any of the Security
Documents or of any financing statement filed in connection with this Agreement
is sufficient as a financing statement.
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(d) Each Borrower shall xxxx its books and records as directed
by the Administrative Agent and as may be necessary or appropriate to evidence,
protect and perfect the Security Interest and shall cause its financial
statements to reflect the Security Interest.
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ARTICLE 8
COLLATERAL COVENANTS
Each Borrower covenants and agrees that until the Commitments
have been terminated and all the Secured Obligations have been paid in full,
unless the Lenders shall otherwise consent in the manner provided in SECTION
15.9:
SECTION 8.1 Collection of Receivables.
(a) The Borrowers will and will cause each other Loan Party to
cause all monies, checks, notes, drafts and other payments relating to or
constituting proceeds of trade accounts receivable, other Receivables and other
Collateral to be deposited in (i) an Agency Account in accordance with the
procedures set out in the corresponding Agency Account Agreement or (ii) an
account subject to instructions from the account holder, in form and substance
satisfactory to the Administrative Agent, requiring the transfer of collected
balances in such account to the Administrative Agent not less often than each
Business Day. In particular, each Borrower will and will cause each other Loan
Party to advise each Account Debtor that makes payment to such Borrower or other
Loan Party by wire transfer, ACH Transfer or similar means to make payment
directly to an Agency Account or, if the applicable Borrower or other Loan Party
is not party to an Agency Account Agreement, then to an account subject to such
instructions.
(b) If average Loan Availability is less than $20,000,000 for
any period of 10 Business Days or is at any time less than $15,000,000, without
limiting the ability of the Administrative Agent and the Lenders to exercise
other rights and remedies hereunder, the Required Lenders may require that any
or all of the Loan Parties establish Lockboxes to which monies, checks, notes,
drafts and other payments relating to or constituting proceeds of Collateral
shall be sent and if such requirement is imposed, each Borrower will and will
cause each other Loan Party to:
(i) advise each Account Debtor on trade accounts
receivable that does not make payments directly to an Agency
Account to address all remittances with respect to amounts
payable on account thereof to a specified Lockbox, and
(ii) stamp all invoices relating to trade accounts
receivable with a legend satisfactory to the Administrative
Agent indicating that payment is to be made to such Borrower
or other Loan Party via a specified Lockbox.
(c) The Borrowers and the Administrative Agent shall cause all
collected balances in each Agency Account and the Borrowers shall, and shall
cause each other Loan Party to, cause all collected balances in each other bank
account subject to transfer instructions approved by the Administrative Agent,
to be transmitted daily by wire transfer, ACH Transfer, depository transfer
check or other means in accordance with the procedures set forth in the
corresponding Agency Account Agreement or such instructions, to the
Administrative Agent at the Administrative Agent's Office:
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(i) for application, on account of the Secured
Obligations, as provided in SECTIONS 2.3(C), 4.16, 12.2, and
12.3, such credits to be entered as of the Business Day they
are received if they are received prior to 1:30 p.m. and to be
conditioned upon final payment in cash or solvent credits of
the items giving rise to them (PROVIDED that a collection fee
shall be payable by the Borrowers with respect to any such
credit received in other than immediately available funds,
equal to one day's interest, at the rate applicable to Base
Rate Loans, on such amount), and
(ii) with respect to the balance, so long as no
Default or Event of Default has occurred and is continuing,
for transfer by wire transfer, ACH Transfer or depository
transfer check to a Controlled Disbursement Account.
(d) Any monies, checks, notes, drafts or other payments
referred to in SUBSECTION (A) or (B) of this SECTION 8.1 which, notwithstanding
the terms of such subsection, are received by or on behalf of the applicable
Borrower will be held in trust for the Administrative Agent and will be
delivered to the Administrative Agent or a Clearing Bank or a bank with which an
account subject to satisfactory transfer instructions is maintained, as promptly
as possible, in the exact form received, together with any necessary
endorsements for application by the Administrative Agent directly to the Secured
Obligations or, as applicable, for deposit in the Agency Account maintained with
such Clearing Bank and processing in accordance with the terms of the
corresponding Agency Account Agreement or for deposit in such account and
processing and transfer in accordance with such instructions.
SECTION 8.2 Verification and Notification. The Administrative
Agent shall have the right at any time and from time to time,
(a) in the name of the Administrative Agent, the Lenders or in
the name of a Borrower, to verify the validity, amount or any other matter
relating to any Receivables by mail, telephone, telegraph or otherwise,
(b) to review, audit and make extracts from all records and
files related to any of the Receivables, and
(c) if a Default or Event of Default has occurred and is
continuing, to notify the Account Debtors or obligors under any Receivables of
the assignment of such Receivables to the Administrative Agent, for the benefit
of the Lenders, and to direct such Account Debtor or obligors to make payment of
all amounts due or to become due thereunder directly to the Administrative
Agent, for the account of the Lenders, and, upon such notification and at the
expense of the Borrowers, to enforce collection of any such Receivables and to
adjust, settle or compromise the amount or payment thereof, in the same manner
and to the same extent as the applicable Borrower might have done.
SECTION 8.3 Disputes, Returns and Adjustments.
(a) In the event any amounts due and owing under any
Receivable for an amount in excess of $250,000 are in dispute between the
Account Debtor and the applicable Borrower, the Borrowers shall provide the
Administrative Agent with prompt written notice thereof.
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(b) The Borrowers shall notify the Administrative Agent
promptly of all returns and credits in excess of $250,000 in respect of any
Receivable, which notice shall specify the Receivable affected.
(c) The Borrowers may, in the ordinary course of business
unless a Default or an Event of Default has occurred and is continuing, grant
any extension of time for payment of any Receivable or compromise, compound or
settle the same for less than the full amount thereof, or release wholly or
partly any Person liable for the payment thereof, or allow any credit or
discount whatsoever therein; PROVIDED that (i) no such action results in the
reduction of more than $250,000 in the amount payable with respect to any
Receivable or of more than $1,000,000 with respect to all Receivables in any
Fiscal Year (in each case, excluding the allowance of credits or discounts
generally available to Account Debtors in the ordinary course of the applicable
Borrower's business), and (ii) the Administrative Agent is promptly notified of
the amount of such adjustments and the Receivable(s) affected thereby (by
reflecting such reduction in an appropriate Borrowing Base Certificate or
Schedule of Receivables).
SECTION 8.4 Invoices.
(a) No Borrower will issue invoices other than in its own name
or in a trade name of which the Administrative Agent has received prior written
notice, accompanied by such evidence as the Administrative Agent may reasonably
require that all actions required pursuant to ARTICLE 7 with respect to
Receivables or other Collateral created or held in such name have been taken.
(b) The Borrowers will not use any invoices other than
invoices in the forms delivered to the Administrative Agent prior to the
Agreement Date without giving the Administrative Agent prior notice of the
intended use of a different form of invoice together with a copy of such
different form and such evidence as the Administrative Agent may reasonably
require that any actions required pursuant to ARTICLE 7 with respect to any (i)
name, (ii) address or (iii) remittance instructions appearing on such invoice
have been taken.
(c) Upon the request of the Administrative Agent, the
Borrowers shall deliver to the Administrative Agent, at the Borrowers' expense,
copies of customers' invoices or the equivalent, original shipping and delivery
receipts or other proof of delivery, customers' statements, customer address
lists, the original copy of all documents, including, without limitation,
repayment histories and present status reports, relating to Receivables and such
other documents and information relating to the Receivables as the
Administrative Agent shall specify.
SECTION 8.5 Delivery of Instruments. In the event any
Receivable is at any time evidenced by a promissory note, trade acceptance or
any other instrument for the payment of money, the Borrowers will, promptly upon
request by the Administrative Agent, deliver such instrument to the
Administrative Agent, appropriately endorsed to the Administrative Agent, for
the benefit of the Lenders.
SECTION 8.6 Sales of Inventory. All sales of Inventory will be
made in compliance in all material respects with all requirements of Applicable
Law.
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SECTION 8.7 Ownership and Defense of Title.
(a) Except for Permitted Liens, the Borrowers shall be or
shall cause another Loan Party to be at all times the sole owners or lessees of
each and every item of Collateral and shall not create nor permit any other Loan
Party to create any lien on, or sell, lease, exchange, assign, transfer, pledge,
hypothecate, grant a security interest or security title in or otherwise dispose
of, any of the Collateral or any interest therein, except for sales of Inventory
in the ordinary course of business, for cash or on open account or on terms of
payment ordinarily extended to its customers, and except for dispositions that
are otherwise expressly permitted under this Agreement or any Subsidiary
Security Agreement.
(b) Each Borrower shall defend and cause each other Loan Party
to defend its title or leasehold interest in and to, and the Security Interest
in, the Collateral against the claims and demands of all Persons.
SECTION 8.8 Insurance.
(a) The Borrowers shall at all times maintain and cause the
other Loan Parties to maintain insurance on the Collateral and their other
property against loss or damage by fire, theft (excluding theft by employees),
burglary, pilferage, loss in transit and such other hazards as the
Administrative Agent shall reasonably specify, in amounts not to exceed those
obtainable at commercially reasonable rates and under policies issued by
insurers acceptable to the Administrative Agent in the exercise of its
reasonable judgment. All premiums on such insurance shall be paid by the
Borrowers and copies of the policies delivered to the Administrative Agent. The
Borrowers will not use or permit the Inventory or its other property to be used
in violation in any material respect of Applicable Law or in any manner which
might render inapplicable any insurance coverage.
(b) All insurance policies required under SECTION 8.8(A)
relating to Collateral shall name the Administrative Agent as an additional
insured and shall contain loss payable clauses in the form submitted to the
Borrowers by the Administrative Agent, or otherwise in form and substance
satisfactory to the Required Lenders, naming the Administrative Agent, as loss
payee, as its interests may appear, and providing that
(i) all proceeds thereunder shall be payable to the
Administrative Agent,
(ii) no such insurance shall be affected by any act
or neglect of the insurer or owner of the property described
in such policy, and
(iii) such policy and loss payable clauses may be
canceled, amended or terminated only upon at least 10 days'
prior written notice given to the Administrative Agent.
(c) Any proceeds of insurance referred to in this SECTION 8.8
which are paid to the Administrative Agent shall be, at the option of the
Required Lenders in their sole discretion, either (i) applied to replace the
damaged or destroyed property, or (ii) applied to the payment or prepayment of
the Secured Obligations, PROVIDED that in the event that the proceeds from any
single casualty do not exceed $250,000, then, upon the Borrowers' written
request to the
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Administrative Agent, provided that no Default or Event of Default shall have
occurred and be continuing, such proceeds shall be disbursed by the
Administrative Agent to the Borrowers pursuant to such procedures as the
Administrative Agent shall reasonably establish for application to the
replacement of the damaged or destroyed property.
SECTION 8.9 Location of Offices and Collateral.
(a) No Borrower will change the location of its chief
executive office or the place where it keeps its books and records relating to
the Collateral from the address set forth for it on SCHEDULE 6.1(T) or change
its name, its identity or corporate structure from that in effect on the
Effective Date, or use any trade name not listed on SCHEDULE 6.1(AA), without
giving the Administrative Agent 30 days' prior written notice thereof
accompanied by such evidence as the Administrative Agent may reasonably require
that all actions required to be taken pursuant to ARTICLE 7 have been taken.
(b) All Inventory, other than Inventory in transit to any such
location, will at all times be kept by the applicable Borrower at one or more
Permitted Inventory Locations and shall not, without the prior written consent
of the Administrative Agent, be kept elsewhere (except as a result of sales of
Inventory permitted under SECTION 8.7(A)).
(c) If any Inventory is in the possession or control of any of
a Borrower's agents or processors, the Borrowers shall notify such agents or
processors of the Security Interest (and shall promptly provide copies of any
such notice to the Administrative Agent and the Lenders) and, upon the
occurrence of an Event of Default, shall instruct them (and cause them to
acknowledge such instruction) to hold all such Inventory for the account of the
account of the Lenders, subject to the instructions of the Administrative Agent.
SECTION 8.10 Records Relating to Collateral.
(a) The Borrowers will and will cause their Subsidiaries to at
all times
(i) keep complete and accurate records of Inventory
on a basis consistent with past practices of Xxxxxxx so as to
permit comparison of Inventory records relating to different
time periods, itemizing and describing the kind, type and
quantity of Inventory and the applicable Borrower's or
Subsidiary's cost thereof and a current price list for such
Inventory, and
(ii) keep complete and accurate records of all other
Collateral.
(b) The Borrowers will prepare a physical listing of all
Inventory, wherever located, at least annually.
SECTION 8.11 Inspection. The Administrative Agent and each
Lender (by any of their officers, employees or agents) shall have the right, to
the extent that the exercise of such right shall be within the control of a
Borrower, at any time or times to
(a) visit the properties of the Borrowers and the
Subsidiaries, inspect the Collateral and the other assets of the Borrowers and
the Subsidiaries and inspect and make
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extracts from the books and records of the Borrowers and the Subsidiaries,
including but not limited to management letters prepared by independent
accountants, all during customary business hours at such premises;
(b) discuss the Borrowers' and the Subsidiaries' business,
assets, liabilities, financial condition, results of operations and business
prospects, insofar as the same are reasonably related to the rights of the
Administrative Agent or the Lenders hereunder or under any of the Loan
Documents, with the Borrowers' and the Subsidiaries' (i) principal officers,
(ii) independent accountants, and (iii) any other Person (except that any such
discussion with any third parties shall be conducted only in accordance with the
Administrative Agent's or such Lender's standard operating procedures relating
to the maintenance of the confidentiality of confidential information of
borrowers); and
(c) verify the amount, quantity, value and condition of, or
any other matter relating to, any of the Collateral and in this connection to
review, audit and make extracts from all records and files related to any of the
Collateral.
The Borrowers will deliver to the Administrative Agent, upon the Administrative
Agent's request, any instrument necessary for it to obtain records from any
service bureau maintaining records on behalf of the Borrowers or any Subsidiary.
SECTION 8.12 Information and Reports.
(a) Schedule of Receivables. The Borrowers shall deliver to
the Administrative Agent on or before the Effective Date and not later than the
20th day of each calendar month thereafter a Schedule of Receivables which
(i) shall be as of the last Business Day of the
immediately preceding Fiscal Month,
(ii) shall be reconciled to the Borrowing Base
Certificate as of such last Business Day, and
(iii) shall set forth a detailed aged trial balance
of all of the Borrowers' then existing Receivables, specifying
the names, addresses and balance due for each Account Debtor
obligated on a Receivable so listed.
(b) Schedule of Inventory. The Borrowers shall deliver to the
Administrative Agent on or before the Effective Date and not later than the 20th
day of each calendar month thereafter a Schedule of Inventory as of the last
Business Day of the immediately preceding Fiscal Month of the Borrowers,
itemizing and describing the kind, type and quantity of Inventory, the
applicable Borrower's cost thereof and the location thereof.
(c) Borrowing Base Certificate. The Borrowers shall deliver to
the Administrative Agent on the 20th day of each calendar month, subject to the
provisions of SECTION 8.12(E), a Borrowing Base Certificate prepared as of the
last Business Day of the preceding Fiscal Month.
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(d) Notice of Diminution of Value. The Borrowers shall give
prompt notice to the Administrative Agent of any matter or event which has
resulted in, or may result in, the diminution in excess of $500,000 in the value
of any of its Collateral, except for any such diminution in the value of any
Receivables or Inventory in the ordinary course of business which has been
appropriately reserved against, as reflected in financial statements previously
delivered to the Administrative Agent and the Lenders pursuant to ARTICLE 10.
(e) Additional Information. The Administrative Agent may in
its reasonable discretion from time to time request that the Borrowers deliver
the schedules and certificates described in SECTIONS 8.12(A), (B), (C) and (D)
more or less often and on different schedules than specified in such Sections
and the Borrowers will comply with such requests. The Borrowers will also
furnish to the Administrative Agent and each Lender such other information with
respect to the Collateral as the Administrative Agent or any Lender may from
time to time reasonably request.
SECTION 8.13 Power of Attorney. Each Borrower hereby appoints
the Administrative Agent as its attorney, with power
(a) to endorse the name of such Borrower on any checks, notes,
acceptances, money orders, drafts or other forms of payment or security that may
come into the Administrative Agent's or any Lender's possession, and
(b) if a Default or Event of Default exists, to sign the name
of such Borrower on any invoice or xxxx of lading relating to any Receivable,
Inventory or other Collateral, on any drafts against customers related to
letters of credit, on schedules and assignments of Receivables furnished to the
Administrative Agent or any Lender by such Borrower, on notices of assignment,
financing statements and other public records relating to the perfection or
priority of the Security Interest, verifications of account and notices to or
from customers.
SECTION 8.14 Assignment of Claims Act. Upon the request of the
Administrative Agent, the Borrowers shall execute any documents or instruments
and shall take such steps or actions reasonably required by the Administrative
Agent so that all monies due or to become due under any contract with the United
States of America, the District of Columbia or any state, county, municipality
or other domestic or foreign governmental entity, or any department, agency or
instrumentality thereof, will be assigned to the Administrative Agent, for the
benefit of itself and the Lenders, and notice given thereof in accordance with
the requirements of the Assignment of Claims Act of 1940, as amended, or any
other laws, rules or regulations relating to the assignment of any such contract
and monies due to or to become due.
ARTICLE 9
AFFIRMATIVE COVENANTS
The Borrowers covenant and agree that the Borrowers will, as
their joint and several obligation, duly and punctually pay the principal of,
and interest on, and all other amounts payable with respect to, the Loans and
all other Secured Obligations in accordance with the terms of the Loan Documents
and that until the Commitments have been terminated and all the Secured
Obligations have been paid in full, unless the Lenders shall otherwise consent
in the
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manner provided for in SECTION 15.9, each of the Borrowers will, and will cause
each of the Subsidiaries to:
SECTION 9.1 Preservation of Corporate Existence and Similar
Matters. Preserve and maintain its corporate existence, rights, franchises,
licenses and privileges in the jurisdiction of its incorporation and qualify and
remain qualified as a foreign corporation and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization (except where any failure
so to qualify could not reasonably be expected to have a Materially Adverse
Effect).
SECTION 9.2 Compliance with Applicable Law. Comply in all
material respects with all Applicable Law relating to the Borrowers or such
Subsidiary except to the extent being contested in good faith by appropriate
proceedings and for which reserves in respect of a Borrower's or such
Subsidiary's reasonably anticipated liability have been established in
accordance with GAAP.
SECTION 9.3 Maintenance of Property. In addition to, and not
in derogation of, the requirements of SECTION 8.7 and of the Security Documents,
(a) protect and preserve all properties material to its
business, including copyrights, patents, trade names and trademarks, and
maintain in good repair, working order and condition in all material respects,
with reasonable allowance for wear and tear, all tangible properties, and
(b) from time to time make or cause to be made all needed and
appropriate repairs, renewals, replacements and additions to such properties
necessary for the conduct of its business, so that the business carried on in
connection therewith in the ordinary course and in a manner consistent with past
practices of Xxxxxxx.
SECTION 9.4 Conduct of Business. At all times conduct its
business in accordance with sound business practices and engage only in the
business(es) described in SCHEDULE 6.1(F).
SECTION 9.5 Insurance. Maintain, in addition to the coverage
required by SECTION 8.8 and the Security Documents, insurance with responsible
insurance companies against such risks and in such amounts as is customarily
maintained by similar businesses or as may be required by Applicable Law, and
from time to time deliver to the Administrative Agent or any Lender upon its
request a detailed list of the insurance then in effect, stating the names of
the insurance companies, the amounts and rates of the insurance, the dates of
the expiration thereof and the properties and risks covered thereby.
SECTION 9.6 Payment of Taxes and Claims. Pay or discharge when
due
(a) all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or upon any properties belonging
to it, except that real property ad valorem taxes shall be deemed to have been
so paid or discharged if the same are paid before they become delinquent, and
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(b) all lawful claims of materialmen, mechanics, carriers,
warehousemen and landlords for labor, materials, supplies and rentals which, if
unpaid, might become a Lien on any properties of any Borrower;
except that this SECTION 9.6 shall not require the payment or discharge of any
such tax, assessment, charge, levy or claim which is being contested in good
faith by appropriate proceedings and for which reserves in respect of reasonably
anticipated liability have been established in accordance with GAAP.
SECTION 9.7 Accounting Methods and Financial Records. Maintain
a system of accounting, and keep such books, records and accounts (which shall
be true and complete), as may be required or as may be necessary to permit the
preparation of financial statements in accordance with GAAP and notify the
Administrative Agent promptly, and in any event within five days after any such
account is opened, of the existence, location, number and title of any bank
account of a Loan Party not listed on SCHEDULE 6.1(BB).
SECTION 9.8 Use of Proceeds.
(a) Use the proceeds of the Loans only for working capital and
general business purposes, including, without being limited to, payment of
interest on the Senior Notes and dividends on the KS Preferred in accordance
with the provisions of this Agreement, and
(b) not use any part of such proceeds to purchase or, to carry
or reduce or retire or refinance any credit incurred to purchase or carry, any
Margin Stock or, in any event, for any purpose which would involve a violation
of Regulation U or of Regulation T or X of the Board of Governors of the Federal
Reserve System, or for any purpose prohibited by law or by the terms and
conditions of this Agreement.
SECTION 9.9 Hazardous Waste and Substances; Environmental
Requirements. In addition to, and not in derogation of, the requirements of
SECTION 9.2 and of the Security Documents, comply in all material respects with
all Environmental Laws and all Applicable Laws relating to occupational health
and safety (except for instances of noncompliance that are being contested in
good faith by appropriate proceedings if reserves in respect of any Borrower's
or such Subsidiary's reasonably anticipated liability therefor have been
appropriately established), promptly notify the Administrative Agent of its
receipt of any notice of a violation of any such Environmental Laws or other
such Applicable Laws and indemnify and hold harmless the Administrative Agent
and the Lenders from all loss, cost, damage, liability, claim and expense
incurred by or imposed upon the Administrative Agent or any Lender on account of
a Borrower's failure to perform its obligations under this SECTION 9.9.
SECTION 9.10 Additional Subsidiaries. Cause each Person that
becomes a domestic Subsidiary of Xxxxxxx after the Effective Date, promptly upon
request by the Administrative Agent, to execute and deliver a Subsidiary
Guaranty and a Subsidiary Security Agreement or, if requested by the
Administrative Agent, enter into and cause any such new Subsidiary or any
existing Subsidiary Guarantor to enter into an amendment to this Agreement or
such other documents as may reasonably be determined by the Administrative Agent
to be necessary or desirable to add such Subsidiary as an additional "Borrower"
hereunder, in each
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case together with such allonges to the Notes, restated promissory notes,
Financing Statements, legal opinions and other certificates, instruments and
documents as the Administrative Agent may reasonably request.
SECTION 9.11 Compliance with Senior Note Indenture. Comply
with the terms and provisions of the Senior Note Indenture and the Senior Notes
and cause each Guarantor of Xxxxxxx'x obligations under the Senior Notes to
comply with the terms of the Guaranty applicable to it.
SECTION 9.12 Agency Account Agreements. To the extent not
received by the Administrative Agent on or prior to the Effective Date, deliver
to the Administrative Agent as soon as possible, but in any event not later than
April 15, 2000, such Agency Account Agreements duly executed by the applicable
Clearing Bank and Loan Party and confirmations of effective directions to pay
the Administrative Agent affecting each account of a Loan Party to which
Collateral proceeds are deposited, each in form and substance satisfactory to
the Administrative Agent, as may be required by the Administrative Agent
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ARTICLE 10
INFORMATION
Until the Commitments have been terminated and all the Secured
Obligations have been paid in full, unless the Lenders shall otherwise consent
in the manner set forth in SECTION 15.9, the Borrowers will furnish to the
Administrative Agent and to each Lender at its offices then designated for
notices pursuant to SECTION 15.1, the statements, reports, certificates, and
other information provided for in this ARTICLE 10. All written information,
reports, statements and other papers and data furnished to the Administrative
Agent or any Lender by or at the request of the Borrowers, whether pursuant to
this ARTICLE 10 or any other provision of this Agreement or of any other Loan
Document, shall be, at the time the same is so furnished, complete and correct
in all material respects to the extent necessary to give the Administrative
Agent and the Lenders true and accurate knowledge of the subject matter.
Specifically, the Borrowers will so furnish:
SECTION 10.1 Financial Statements.
(a) Audited Year-End Statements. As soon as available, but in
any event within 90 days after the end of each Fiscal Year, copies of the
consolidated and consolidating balance sheets of Xxxxxxx and its Consolidated
Subsidiaries as at the end of such Fiscal Year and the related consolidated and
consolidating statements of income, shareholders' equity and cash flows of
Xxxxxxx and its Consolidated Subsidiaries for such Fiscal Year, in each case
setting forth in comparative form the figures for the previous Fiscal Year, and,
as to such consolidated financial statements, reported on, without
qualification, by Xxxxxx Xxxxxxxx LLP or other independent certified public
accountants of nationally recognized standing;
(b) Monthly Financial Statements. As soon as available after
the end of each Fiscal Month, but in any event within 30 days after the end of
each Fiscal Month (or 45 days after the end of any such Fiscal Month that is the
last Fiscal Month of a Fiscal Quarter), copies of the unaudited consolidated and
consolidating balance sheets of Xxxxxxx and its Consolidated Subsidiaries as at
the end of such Fiscal Month and the related unaudited consolidated and
consolidating statements of income and cash flows for Xxxxxxx and its
Consolidated Subsidiaries for such Fiscal Month and for the portion of the
Fiscal Year through such Fiscal Month, certified by a Financial Officer as
presenting fairly the financial condition and results of operations of the
Borrowers (subject to normal year-end audit adjustments) for the applicable
period(s);
all such financial statements to be complete and correct in all material
respects and prepared in accordance with GAAP (except, with respect to interim
financial statements, for the omission of notes and for the effect of normal
year-end audit adjustments) applied consistently throughout the periods
reflected therein; and
(c) Projections. As soon as available, but in any event not
later than 30 days after the first day of each Fiscal Year beginning after the
Effective Date, Projections for such Fiscal Year in such format and detail as
the Administrative Agent may reasonably specify.
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SECTION 10.2 Accountants' Certificate. Together with the
financial statements referred to in SECTION 10.1(A), a certificate of such
accountants addressed to the Administrative Agent
(a) stating that in making the examination necessary for the
certification of such financial statements, nothing has come to their attention
to lead them to believe that any Default or Event of Default exists and, in
particular, they have no knowledge of any Default or Event of Default or, if
such is not the case, specifying such Default or Event of Default and its
nature, and
(b) having attached the calculations, prepared by the
Borrowers and reviewed by such accountants, required to establish whether or not
the Borrowers are in compliance with the covenants contained in SECTIONS 11.1,
11.2, 11.4 and 11.5 as at the date of such financial statements.
SECTION 10.3 Officer's Certificate. At the time that the
Borrowers furnish the financial statements pursuant to SECTION 10.1(B) for the
last Fiscal Month in a Fiscal Quarter, a certificate of the President of Xxxxxxx
or of a Financial Officer in substantially the form attached hereto as EXHIBIT
D,
(a) setting forth as at the end of such Fiscal Quarter or
Fiscal Year, as the case may be, the calculations required to establish whether
or not the Borrowers were in compliance with the requirements of SECTIONS 11.1,
11.2, 11.4 and 11.5 as at the end of each respective period, and
(b) stating that, based on a reasonably diligent examination,
no Default or Event of Default exists, or, if such is not the case, specifying
such Default or Event of Default and its nature, when it occurred, whether it is
continuing and the steps being taken by the Borrowers with respect to such
Default or Event of Default.
SECTION 10.4 Copies of Other Reports.
(a) Promptly upon receipt thereof, copies of all reports, if
any, submitted to the Borrowers or the Board of Directors of Xxxxxxx by the
Borrowers' independent public accountants, including, without limitation, any
management report.
(b) As soon as practicable, copies of all financial statements
and reports that Xxxxxxx sends to its shareholders generally in their capacity
as such and of all registration statements and all regular or periodic reports
which any Borrower shall file with the Securities and Exchange Commission or any
successor commission.
(c) From time to time and as soon as reasonably practicable
following each request, such data, certificates, reports, statements, opinions
of counsel, documents or further information regarding the business, assets,
liabilities, financial condition, results of operations or business prospects of
a Borrower or any Subsidiary as the Administrative Agent or any Lender may
reasonably request and that a Borrower has or (except in the case of legal
opinions relating to the perfection or priority of the Security Interest)
without unreasonable expense can obtain; PROVIDED, HOWEVER, that the Lenders
shall, to the extent reasonably practicable, coordinate
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examinations of the Borrowers' records by their respective internal examiners.
The rights of the Administrative Agent and the Lenders under this SECTION 10.4
are in addition to and not in derogation of their rights under any other
provision of this Agreement or of any other Loan Document.
(d) If requested by the Administrative Agent or any Lender,
statements in conformity with the requirements of Federal Reserve Form G-3 or
U-1 referred to in Regulation U.
SECTION 10.5 Notice of Litigation and Other Matters. Prompt
notice of:
(a) the commencement, to the extent a Borrower is aware of the
same, of all proceedings and investigations by or before any governmental or
nongovernmental body and all actions and proceedings in any court or before any
arbitrator against or in any other way relating to or affecting any Borrower,
any of its Subsidiaries or any of a Borrower's or any of its Subsidiaries'
properties, assets or businesses, which is reasonably likely to, singly or
together with other pending proceedings or investigations, result in the
occurrence of a Default or an Event of Default, or have a Materially Adverse
Effect,
(b) any amendment of the articles of incorporation or by-laws
of a Borrower or any of its Subsidiaries,
(c) any change in the business, assets, liabilities, financial
condition, results of operations or business prospects of a Borrower or any of
its Subsidiaries which has had or is reasonably likely to have, singly or in the
aggregate, a Materially Adverse Effect and any change in the executive officers
of a Borrower,
(d) the discovery or determination by any Loan Party that any
computer application (including any computer application of any key supplier,
vendor or customer) that is material to the business or operations of any
Borrower is not Year 2000 Compliant, except to the extent that such failure
could not reasonably be expected to have a Materially Adverse Effect,
(e) the receipt of any notice from or giving of any notice to
the trustee under the Senior Note Indenture, together with a copy of such
notice, and
(f) any Default or Event of Default or any event which
constitutes or which with the passage of time or giving of notice or both would
constitute a default or event of default by a Borrower or any of its
Subsidiaries under any material agreement (other than this Agreement) to which
such Borrower or any of its Subsidiaries is a party or by which any Borrower,
any of its Subsidiaries or any Borrower's or any Subsidiary's properties may be
bound.
SECTION 10.6 ERISA. As soon as possible and in any event
within 30 days after a Borrower knows, or has reason to know, that:
(a) any ERISA Event with respect to a Benefit Plan has
occurred or will occur, or
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(b) the aggregate present value of the Unfunded Vested Accrued
Benefits under all Benefit Plans is equal to an amount in excess of $0, or
(c) a Borrower or any Subsidiary is in "default" (as defined
in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer
Benefit Plan required by reason of a Borrower's or such Subsidiary's complete or
partial withdrawal (as described in Section 4203 or 4205 of ERISA) from such
Multiemployer Plan,
to the Administrative Agent a certificate of the President of Xxxxxxx or a
Financial Officer setting forth the details of such event and the action which
is proposed to be taken with respect thereto, together with any notice or filing
which may be required by the PBGC or other agency of the United States
government with respect to such event.
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ARTICLE 11
NEGATIVE COVENANTS
Until the Commitments have been terminated and all the Secured
Obligations have been paid in full, unless the Lenders shall otherwise consent
in the manner set forth in SECTION 15.9, the Borrowers will not directly or
indirectly and, in the case of SECTIONS 11.2 through 11.12, will not permit any
Subsidiaries to:
SECTION 11.1 Financial Covenants.
(a) Permit Net Worth of Xxxxxxx and its Consolidated
Subsidiaries on a consolidated basis at any time on or after the Effective Date
to be less than $21,000,000; provided, that for purposes of this SECTION
11.1(A), the Net Worth of Xxxxxxx and its Consolidated Subsidiaries shall
exclude any and all amounts recorded as an expense from time to time after
December 31, 1999 to reflect amortization of goodwill.
(b) Permit Collateral Availability at any time after the
Effective Date to be less than $15,000,000.
(c) Permit the Interest Coverage Ratio as of the last day of
any Fiscal Quarter ending on or after the Effective Date, calculated for the
period of four consecutive Fiscal Quarters then ended, to be less than 1.25 to
1.
SECTION 11.2 Debt. Create, assume, or otherwise become or
remain obligated in respect of, or permit or suffer to exist or to be created,
assumed or incurred or to be outstanding any Debt, except that this SECTION 11.2
shall not apply to:
(a) Debt of the Loan Parties represented by the Loan
Documents,
(b) Subordinated Debt,
(c) Debt of the Loan Parties represented by the Senior Notes,
(d) Debt reflected on SCHEDULE 6.1(J) and refinancings thereof
that do not result in an increase in the principal amount of any such Debt
outstanding on the date of refinancing or in any other Person becoming obligated
thereon, but excluding any such scheduled Debt that is to be paid in full on the
Effective Date,
(e) Acquired Debt permitted in accordance with SECTION 11.4
and Attributable Debt permitted in accordance with SECTION 11.10,
(f) vendor loans, advances and similar financings in an
aggregate principal amount outstanding at any time not to exceed $20,000,000,
and
(g) other Debt in an aggregate principal amount outstanding at
any time not to exceed $15,000,000.
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SECTION 11.3 Guarantees. Become or remain liable with respect
to any Guaranty of any obligation of any other Persons, except as listed on
SCHEDULE 6.1(J) or pursuant to a Guaranty by a Borrower or any Subsidiary of the
obligations of a Loan Party (including specifically the Subsidiaries' Guarantees
of Xxxxxxx'x obligations in respect of the Senior Notes).
SECTION 11.4 Acquisitions. (a) Acquire, after the Agreement
Date, any Business Unit or Investment or, after the Agreement Date, maintain any
Investment other than Permitted Investments, EXCEPT that this SECTION 11.4 shall
not apply to Acquisitions by Xxxxxxx or another Loan Party after the Effective
Date of (A) Investments in the capital stock of any other Person organized under
the laws of the United States of America or any state thereof which thereupon
becomes a Wholly Owned Subsidiary or (B) Business Units located in the United
States, provided, that:
(i) the aggregate Purchase Price of all such Acquisitions does
not exceed $75,000,000 during the term of this Agreement,
(ii) Xxxxxxx or the applicable Loan Party has made available
to the Administrative Agent, not later than 10 Business Days prior to
the proposed date of such Acquisition, the results of any investigation
of the target performed by or on behalf of such Loan Party and copies
of the Acquisition documents and historical financial statements of the
target for at least the three previous years,
(iii) the Administrative Agent shall have received evidence
satisfactory to it of the Loan Parties' continued compliance with the
provisions of this Agreement and the other Loan Documents, including,
without being limited to, the provisions of SECTIONS 9.4, 9.11 and
11.1, on a pro forma basis after giving effect to such Acquisition,
(iv) to the extent financed with Debt other than Acquired Debt
or Loans, such Debt shall be payable to the seller and shall be
subordinated to the prior payment of the Secured Obligations on terms
and conditions satisfactory to the Administrative Agent and the
Required Lenders,
(v) the Administrative Agent shall have received evidence
satisfactory to it demonstrating on a pro forma basis that Net Income
of the target, before provision for interest expense, taxes,
depreciation and amortization for the period of 12 consecutive calendar
months ended nearest the date of determination, is at least equal to
the sum of interest expense and scheduled principal payments on any
Debt incurred in connection with payment of the Purchase Price
(including Loans and Acquired Debt), and
(vi) as requested by the Administrative Agent, any new
Subsidiary shall have executed and delivered the Subsidiary Guaranty
and a Subsidiary Security Agreement, or all Loan Parties, as
appropriate, and such new Subsidiary shall have executed and delivered
an amendment to this Agreement sufficient to cause such new Subsidiary
to become a "Borrower" hereunder, and in either case shall have
delivered or caused to be delivered as to such Subsidiary the items
referred to in SECTIONS 5.1(A)(3), (4), (5), (6), and (8) and an
opinion of counsel for such Subsidiary as to such matters in connection
with the transactions contemplated by the Subsidiary Guaranty and
Subsidiary Security
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Agreement or such amendment to this Agreement as the Administrative
Agent may reasonably request;
PROVIDED, HOWEVER, that Xxxxxxx or the applicable Loan Party shall not be
required to furnish the information described in SECTION 11.4(A)(II) or (A)(V)
except with respect to any Acquisition the aggregate Purchase Price of which,
when added to the aggregate Purchase Price of all Acquisitions made on or after
the Effective Date and prior to the date of determination as to which such
information has not been provided, exceeds $10,000,000.
"Purchase Price" means an amount equal to the total consideration paid for such
Acquisition, including all cash payments (whether classified as purchase price,
noncompete payments, consulting payments, "earn out" or otherwise and without
regard to whether such amount is paid in whole or in part at the closing of the
Acquisition or over time thereafter, but excluding any finance charges
attributable to deferred payments and excluding any salary or other employment
compensation paid to a seller for the purpose of retaining such seller's
services as an active employee of a Borrower or a Subsidiary), the principal
amount of all Acquired Debt and of any Subordinated Debt owing to the seller,
and the value (as determined by the board of directors of Xxxxxxx, including
pursuant to the applicable purchase agreement between the relevant Borrower and
the seller, in the case of any property, the fair value of which is not readily
ascertainable) of all other property, other than capital stock of Xxxxxxx,
transferred by Xxxxxxx to the seller.
(b) Notwithstanding any provision of this Agreement to the
contrary, in connection with any merger (or other distribution of the assets) of
a Subsidiary that is not a Loan Party with and into (or to) a Loan Party, or any
Acquisition of a Business Unit, whether by purchase of stock, merger, or
purchase of assets and whether in a single transaction or series of related
transactions, by a Borrower, where the value of the assets of such Subsidiary or
the Purchase Price of such Acquisition, as the case may be:
(i) is less than $10,000,000, Xxxxxxx shall have the
right to determine whether the Inventory and Receivables so
acquired are included in the Borrowing Base, subject to the
provision of the definitions "Borrowing Base," "Eligible
Inventory" and Eligible Receivables" and any other provisions
of this Agreement and the other Loan Documents applicable to
the computation and reporting of the Borrowing Base, and if
Xxxxxxx elects so to include such acquired Inventory and
Receivables, then any Subsidiary that owns any such acquired
Inventory or Receivables shall execute and deliver to the
Administrative Agent the agreements, certificates, instruments
and other documents referred to in SECTION 11.4(A)(VI) or
(ii) is $10,000,000 or more, the Required Lenders
shall have the right to determine whether any Inventory or
Receivables so acquired are included in the Borrowing Base
(subject to the other applicable provisions of this
Agreement).
SECTION 11.5 Capital Expenditures. Make or incur any Capital
Expenditures (excluding Financed Capex and expenditures pursuant to SECTION
11.4) in the aggregate in excess of $12,000,000 for any Fiscal Year, PROVIDED
that any amount of such allowance not used in a Fiscal Year may be carried
forward, but only to the succeeding Fiscal Year.
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SECTION 11.6 Restricted Distributions and Payments, Etc.
Declare or make any Restricted Distribution or Restricted Payment in any Fiscal
Year which, when added to all other Restricted Distributions and Restricted
Payments made in the same Fiscal Year of Xxxxxxx, would exceed $2,000,000;
PROVIDED, that Restricted Payments shall not include any non-compete, bonus or
"earn-out" payments payable (i) to the former stockholders of CPW pursuant to
agreements in effect on the Effective Date or (ii) in connection with an
Acquisition by Xxxxxxx or any other Loan Party after the Effective Date that is
permitted under SECTION 11.4(A).
SECTION 11.7 Merger, Consolidation and Sale of Assets. Merge
or consolidate with any other Person or sell, lease or transfer or otherwise
dispose of all or a substantial portion of its assets to any Person other than
sales of Inventory in the ordinary course of business, EXCEPT that any Loan
Party may merge with and into another Loan Party (provided that Xxxxxxx shall be
the surviving corporation of any merger to which it is a party) and, subject to
the provisions of SECTION 11.4(B), any Subsidiary may merge into a Loan Party
with such Loan Party as the surviving corporation.
SECTION 11.8 Transactions with Affiliates. Except as described
on SCHEDULE 11.8, effect any transaction with any Affiliate on a basis less
favorable to a Loan Party than would be the case if such transaction had been
effected with a Person not an Affiliate.
SECTION 11.9 Liens. Create, assume or permit or suffer to
exist or to be created or assumed any Lien on any of the Collateral or its other
assets, other than Liens listed in CLAUSES (A) through (I) of the definition
"Permitted Liens" and (a) Liens securing Acquired Debt, which Liens affect
solely capital or fixed assets (and not Receivables or Inventory or proceeds
thereof) of the Business Unit Acquired, existing on the date of the related
Acquisition and not created in contemplation thereof, and (b) Purchase Money
Liens (including Capitalized Lease Obligations) securing Debt otherwise
permitted pursuant to SECTION 11.2.
SECTION 11.10 Sales and Leasebacks. Enter into any arrangement
with any Person providing for a Loan Party's leasing from such Person any real
or personal property which has been or is to be sold or transferred, directly or
indirectly, by a Loan Party to such Person, if the associated Attributable Debt,
when added to all other outstanding Attributable Debt, would exceed $15,000,000.
SECTION 11.11 Amendments of Other Agreements. Amend the
interest rate or principal amount or schedule of payments of principal and
interest with respect to any Debt (other than the Secured Obligations) or any
dividend rate or redemption schedule, applicable to any preferred stock of a
Borrower, other than to reduce the interest or dividend rate or to extend any
such schedule of payments or redemption schedule, or amend or cause or permit to
be amended in any material respect or in any respect that may be adverse to the
interests of the Administrative Agent or the Lenders, (i) the KS Preferred Stock
Purchase Agreement, (ii) the Senior Note Indenture, or (iii) the articles or
certificate of incorporation of any Loan Party.
SECTION 11.12 Commingling. Commingle or permit the commingling
of Collateral or proceeds of Collateral with other property of or under the
control of any of Xxxxxxx or any of its Subsidiaries that is not Collateral or
proceeds thereof.
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ARTICLE 12
DEFAULT
SECTION 12.1 Events of Default. Each of the following shall
constitute an Event of Default, whatever the reason for such event and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment or order of any court or any order, rule or regulation
of any governmental or nongovernmental body:
(a) Default in Payment. The Borrowers shall default in any
payment of principal of or interest on any Loan or any Note when and as due
(whether at maturity, by reason of acceleration or otherwise).
(b) Other Payment Default. The Borrowers shall default in the
payment, as and when due, of principal of or interest on, any other Secured
Obligation, and such default shall continue for a period of 10 days after
written notice thereof has been given to the Borrowers by the Administrative
Agent.
(c) Misrepresentation. Any representation or warranty made or
deemed to be made by the Borrowers under this Agreement or any Loan Document, or
any amendment hereto or thereto, shall at any time prove to have been incorrect
or misleading in any material respect when made.
(d) Default in Performance. The Borrowers shall default in the
performance or observance of any term, covenant, condition or agreement to be
performed by the Borrowers, contained in
(i) ARTICLES 8 (other than SECTIONS 8.3 and 8.4(A))
or 11, or SECTIONS 9.1 (insofar as it requires the
preservation of the corporate existence of the Borrowers),
9.8, 10.1, 10.2 OR 10.3, and the Administrative Agent shall
have delivered to the Borrowers written notice of such
default, or
(ii) this Agreement (other than as specifically
provided for otherwise in this SECTION 12.1) and such default
shall continue for a period of 30 days after written notice
thereof has been given to the Borrowers by the Administrative
Agent.
(e) Debt Cross-Default.
(i) A Borrower or any Subsidiary shall fail to pay
when due and payable (and within any applicable cure or grace
period) the principal of or interest on any Debt (other than
the Loans) in an amount in excess of $5,000,000, or
(ii) the maturity of any such Debt outstanding in a
principal amount greater than $5,000,000 shall have (A) been
accelerated in accordance with the provisions of any
indenture, contract or instrument providing for the creation
of or concerning such Indebtedness, or (B) been required to be
prepaid prior to the stated maturity thereof, including,
without being limited to, upon a "Change of Control" as
defined in the Senior Note Indenture, or
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(iii) any event shall have occurred and be continuing
which would permit any holder or holders of such Debt
outstanding in an amount in excess of $5,000,000, any trustee
or agent acting on behalf of such holder or holders or any
other Person so to accelerate such maturity, and the Borrowers
shall have failed to cure such default prior to the expiration
of any applicable cure or grace period.
(f) Other Cross-Defaults; Mandatory Redemption. A Borrower or
any Subsidiary shall default in the payment when due, or in the performance or
observance, of any obligation or condition of any agreement, contract or lease
(other than this Agreement, the Security Documents or any such agreement,
contract or lease relating to Debt), if the existence of any such defaults,
singly or in the aggregate, could reasonably be expected to have a Materially
Adverse Effect, PROVIDED, that for the purposes of this provision, where such a
default could result only in a monetary loss, a Materially Adverse Effect shall
not be deemed to have occurred unless the aggregate of such losses would exceed
$5,000,000, or any event shall occur or circumstances exist that would result in
or permit the holder thereof to require the redemption of the KS Preferred.
(g) Voluntary Bankruptcy Proceeding. A Borrower or any
Subsidiary shall
(i) commence a voluntary case under the federal
bankruptcy laws (as now or hereafter in effect),
(ii) file a petition seeking to take advantage of any
other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or composition for
adjustment of debts,
(iii) consent to or fail to contest in a timely and
appropriate manner any petition filed against it in an
involuntary case under such bankruptcy laws or other laws,
(iv) apply for or consent to, or fail to contest in a
timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee, or
liquidator of itself or of a substantial part of its property,
domestic or foreign,
(v) admit in writing its inability to pay its debts
as they become due,
(vi) make a general assignment for the benefit of
creditors, or
(vii) take any corporate action for the purpose of
authorizing any of the foregoing.
(h) Involuntary Bankruptcy Proceeding. A case or other
proceeding shall be commenced against a Borrower or any Subsidiary in any court
of competent jurisdiction seeking
(i) relief under the federal bankruptcy laws (as now
or hereafter in effect) or under any other laws, domestic or
foreign, relating to bankruptcy, insolvency, reorganization,
winding up or adjustment of debts,
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(ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of a Borrower, any
Subsidiary or of all or any substantial part of the assets,
domestic or foreign, of a Borrower or any Subsidiary,
and such case or proceeding shall continue undismissed or unstayed for a period
of 60 consecutive calendar days, or an order granting the relief requested in
such case or proceeding against such Borrower or Subsidiary (including, but not
limited to, an order for relief under such federal bankruptcy laws) shall be
entered.
(i) Loan Documents. Any "Event of Default" under any Loan
Document (other than this Agreement) shall occur or a Borrower shall default in
the performance or observance of any material term, covenant, condition or
agreement contained in, or the payment of any other sum covenanted to be paid by
the Borrowers under, any Loan Document (other than this Agreement) that does not
expressly provide for "Events of Default," or any provision thereof (in each
case, after giving effect to any applicable grace or cure period), other than
any nonmaterial provision rendered unenforceable by operation of law, shall
cease to be valid and binding.
(j) Failure of Agreements. A Loan Party shall challenge the
validity and binding effect of any provision of any Loan Document after delivery
thereof hereunder or shall state in writing its intention to make such a
challenge, or any Security Document, after delivery thereof hereunder, shall for
any reason (except to the extent permitted by the terms thereof) cease to create
a valid and perfected first priority Lien (except for Permitted Liens) on, or
security interest in, any of the Collateral purported to be covered thereby.
(k) Judgment. A final, unappealable judgment or order for the
payment of money in an amount that exceeds the uncontested insurance available
therefor by $2,500,000 or more shall be entered against a Borrower by any court
and such judgment or order shall continue undischarged or unstayed for 30 days.
(l) Attachment. A warrant or writ of attachment or execution
or similar process which exceeds $2,500,000 in value shall be issued against any
property of a Borrower and such warrant or process shall continue undischarged
or unstayed for 30 days.
(m) ERISA. In addition to the breach of any other
representation and warranty, any ERISA Event with respect to a Benefit Plan
shall occur.
(n) Qualified Audits. The independent certified public
accountants retained by Xxxxxxx shall refuse to deliver an opinion in accordance
with SECTION 10.1(A) with respect to the annual consolidated financial
statements of Xxxxxxx and its Consolidated Subsidiaries.
(o) Change of Control. Xxxxxxx shall cease to own, directly or
indirectly, 100% of the issued and outstanding stock of each other Loan Party or
a "Change of Control" for purposes of the Senior Note Indenture, the Class B
Stock or the Warrant shall occur.
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SECTION 12.2 Remedies.
(a) Automatic Acceleration and Termination of Facilities. Upon
the occurrence of an Event of Default specified in SECTION 12.1(G) or (H), (i)
the principal of and the interest on the Loans and any Note at the time
outstanding, and all other amounts owed to the Administrative Agent or the
Lenders under this Agreement or any of the other Loan Documents and all other
Secured Obligations, shall thereupon become due and payable without presentment,
demand, protest, or other notice of any kind, all of which are expressly waived,
anything in this Agreement or any of the Loan Documents to the contrary
notwithstanding, and (ii) the Commitments and the right of the Borrowers to
request Borrowings under this Agreement shall immediately terminate.
(b) Other Remedies. If any Event of Default shall have
occurred, and during the continuance of any Event of Default, the Administrative
Agent may, and at the direction of the Required Lenders in their sole and
absolute discretion shall, do any of the following:
(i) declare the principal of and interest on the
Loans and any Note at the time outstanding, and all other
amounts owed to the Administrative Agent or the Lenders under
this Agreement or any of the other Loan Documents and all
other Secured Obligations, to be forthwith due and payable,
whereupon the same shall immediately become due and payable
without presentment, demand, protest or other notice of any
kind, all of which are expressly waived, anything in this
Agreement or the Loan Documents to the contrary
notwithstanding;
(ii) terminate the Commitments and any other right of
the Borrowers to request borrowings hereunder;
(iii) notify, or request the Borrowers to notify, in
writing or otherwise, any Account Debtor or obligor with
respect to any one or more of the Receivables to make payment
to the Administrative Agent, for the benefit of the Lenders,
or any agent or designee of the Administrative Agent, at such
address as may be specified by the Administrative Agent and
if, notwithstanding the giving of any notice, any Account
Debtor or other such obligor shall make payments to the
Borrowers, the Borrowers shall hold all such payments received
in trust for the Administrative Agent, for the account of the
Lenders, without commingling the same with other funds or
property of, or held by, the Borrowers, and shall deliver the
same to the Administrative Agent or any such agent or designee
of the Administrative Agent immediately upon receipt by the
Borrowers in the identical form received, together with any
necessary endorsements;
(iv) settle or adjust disputes and claims directly
with Account Debtors and other obligors on Receivables for
amounts and on terms which the Administrative Agent considers
advisable and in all such cases only the net amounts received
by the Administrative Agent, for the account of the Lenders,
in payment of such amounts, after deductions of costs and
attorneys' fees, shall constitute Collateral and the Borrowers
shall have no further right to make any such settlements or
adjustments or to accept any returns of merchandise;
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(v) enter upon any premises in which Inventory may be
located and, without resistance or interference by the
Borrowers, take physical possession of any or all thereof and
maintain such possession on such premises or move the same or
any part thereof to such other place or places as the
Administrative Agent shall choose, without being liable to the
Borrowers on account of any loss, damage or depreciation that
may occur as a result thereof, so long as the Administrative
Agent shall act reasonably and in good faith;
(vi) require the Borrowers to and the Borrowers
shall, without charge to the Administrative Agent or any
Lender, assemble the Inventory and maintain or deliver it into
the possession of the Administrative Agent or any agent or
representative of the Administrative Agent at such place or
places as the Administrative Agent may designate and as are
reasonably convenient to both the Administrative Agent and the
applicable Borrower;
(vii) at the expense of the Borrowers, cause any of
the Inventory to be placed in a public or field warehouse, and
the Administrative Agent shall not be liable to the Borrowers
on account of any loss, damage or depreciation that may occur
as a result thereof, so long as the Administrative Agent shall
act reasonably and in good faith;
(viii) without notice, demand or other process, and
without payment of any rent or any other charge, enter any of
the Borrowers' premises and, without breach of the peace,
until the Administrative Agent, on behalf of the Lenders,
completes the enforcement of its rights in the Collateral,
take possession of such premises or place custodians in
exclusive control thereof, remain on such premises and use the
same and any of the Borrowers' equipment, for the purpose of
(A) completing any work in process, preparing any Inventory
for disposition and disposing thereof, and (B) collecting any
Receivable, and the Administrative Agent for the benefit of
the Lenders is hereby granted a license or sublicense and all
other rights as may be necessary, appropriate or desirable to
use the Proprietary Rights in connection with the foregoing,
and the rights of the Borrowers under all licenses,
sublicenses and franchise agreements shall inure to the
Administrative Agent for the benefit of the Lenders (PROVIDED,
HOWEVER, that any use of any federally registered trademarks
as to any goods shall be subject to the control as to the
quality of such goods of the owner of such trademarks and the
goodwill of the business symbolized thereby);
(ix) exercise any and all of its rights under any and
all of the Security Documents;
(x) apply any Collateral consisting of cash to the
payment of the Secured Obligations in any order in which the
Administrative Agent, on behalf of the Lenders, may elect or
use such cash in connection with the exercise of any of its
other rights hereunder or under any of the Security Documents;
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(xi) establish or cause to be established one or more
Lockboxes or other arrangement for the deposit of proceeds of
Receivables, and, in such case, the Borrowers shall cause to
be forwarded to the Administrative Agent at the Administrative
Agent's Office, on a daily basis, copies of all checks and
other items of payment and deposit slips related thereto
deposited in such Lockboxes, together with collection reports
in form and substance satisfactory to the Administrative
Agent; and
(xii) exercise all of the rights and remedies of a
secured party under the UCC and under any other Applicable
Law, including, without limitation, the right, without notice
except as specified below and with or without taking
possession thereof, to sell the Collateral or any part thereof
in one or more parcels at public or private sale, at any
location chosen by the Administrative Agent, for cash, on
credit or for future delivery, and at such price or prices and
upon such other terms as the Administrative Agent may deem
commercially reasonable. Each Borrower agrees that, to the
extent notice of sale shall be required by law, at least 10
days' notice to the Borrowers of the time and place of any
public sale or the time after which any private sale is to be
made shall constitute reasonable notification, but notice
given in any other reasonable manner or at any other
reasonable time shall constitute reasonable notification. The
Administrative Agent shall not be obligated to make any sale
of Collateral regardless of notice of sale having been given.
The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned.
SECTION 12.3 Application of Proceeds. All proceeds from each
sale of, or other realization upon, all or any part of the Collateral following
an Event of Default shall be applied or paid over in accordance with the
provisions of SECTION 4.16.
THE BORROWERS SHALL REMAIN LIABLE AND WILL PAY, ON DEMAND, ANY DEFICIENCY
REMAINING IN RESPECT OF THE SECURED OBLIGATIONS, TOGETHER WITH INTEREST THEREON
AT A RATE PER ANNUM EQUAL TO THE HIGHEST RATE THEN PAYABLE HEREUNDER ON SUCH
SECURED OBLIGATIONS, WHICH INTEREST SHALL CONSTITUTE PART OF THE SECURED
OBLIGATIONS.
SECTION 12.4 Power of Attorney. In addition to the
authorizations granted to the Administrative Agent under SECTION 9.13 or under
any other provision of this Agreement or of any other Loan Document, during the
continuance of an Event of Default, each Borrower hereby irrevocably designates,
makes, constitutes and appoints the Administrative Agent (and all Persons
designated by the Administrative Agent from time to time) as the Borrower's true
and lawful attorney, and agent in fact, and the Administrative Agent, or any
agent of the Administrative Agent, may, without notice to the Borrowers, and at
such time or times as the Administrative Agent or any such agent in its sole
discretion may determine, in the name of a Borrower, the Administrative Agent or
the Lenders,
(a) demand payment of the Receivables,
(b) enforce payment of the Receivables by legal proceedings or
otherwise,
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(c) exercise all of any Borrower's rights and remedies with
respect to the collection of Receivables,
(d) settle, adjust, compromise, extend or renew any or all of
the Receivables,
(e) settle, adjust or compromise any legal proceedings brought
to collect the Receivables,
(f) discharge and release the Receivables or any of them,
(g) prepare, file and sign the name of a Borrower on any proof
of claim in bankruptcy or any similar document against any Account Debtor,
(h) prepare, file and sign the name of a Borrower on any
notice of Lien, assignment or satisfaction of Lien, or similar document in
connection with any of the Collateral,
(i) endorse the name of a Borrower upon any chattel paper,
document, instrument, notice, freight xxxx, xxxx of lading or similar document
or agreement relating to the Receivables, the Inventory or any other Collateral,
(j) use the stationery of the Borrowers and sign the names of
the Borrowers to verifications of the Receivables and on any notice to the
Account Debtors,
(k) open the Borrowers' mail,
(l) notify the post office authorities to change the address
for delivery of the Borrowers' mail to an address designated by the
Administrative Agent, and
(m) use the information recorded on or contained in any data
processing equipment and computer hardware and software relating to the
Receivables, Inventory or other Collateral to which any Borrower has access.
SECTION 12.5 Miscellaneous Provisions Concerning Remedies.
(a) Rights Cumulative. The rights and remedies of the
Administrative Agent and the Lenders under this Agreement, the Notes and each of
the Loan Documents shall be cumulative and not exclusive of any rights or
remedies which it or they would otherwise have. In exercising such rights and
remedies the Administrative Agent and the Lenders may be selective and no
failure or delay by the Administrative Agent or any Lender in exercising any
right shall operate as a waiver of it, nor shall any single or partial exercise
of any power or right preclude its other or further exercise or the exercise of
any other power or right.
(b) Waiver of Marshalling. Each Borrower hereby waives any
right to require any marshalling of assets and any similar right.
(c) Limitation of Liability. Nothing contained in this ARTICLE
12 or elsewhere in this Agreement or in any of the Loan Documents shall be
construed as requiring or obligating the Administrative Agent, any Lender or any
agent or designee of the Administrative Agent or
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any Lender to make any demand, or to make any inquiry as to the nature or
sufficiency of any payment received by it, or to present or file any claim or
notice or take any action, with respect to any Receivable or any other
Collateral or the monies due or to become due thereunder or in connection
therewith, or to take any steps necessary to preserve any rights against prior
parties, and the Administrative Agent, the Lenders and their agents or designees
shall have no liability to the Borrowers for actions taken pursuant to this
ARTICLE 12, any other provision of this Agreement or any of the Loan Documents
so long as the Administrative Agent or such Lender shall act in good faith and
in a commercially reasonable manner.
(d) Appointment of Receiver. In any action under this ARTICLE
12, the Administrative Agent shall be entitled during the continuance of an
Event of Default, to the fullest extent permitted by Applicable Law, to the
appointment of a receiver, without notice of any kind whatsoever, to take
possession of all or any portion of the Collateral and to exercise such power as
the court shall confer upon such receiver.
SECTION 12.6 Trademark License. Each Borrower hereby grants to
the Administrative Agent for its benefit as Administrative Agent and for the
benefit of the Lenders, the nonexclusive right and license to use its trademarks
for the purposes set forth in SECTION 12.2(B)(VIII) and for the purpose of
enabling the Administrative Agent to realize on the Collateral and to permit any
purchaser of any portion of the Collateral through a foreclosure sale or any
other exercise of the Administrative Agent's rights and remedies under this
Agreement and the other Security Documents to use, sell or otherwise dispose of
the Collateral bearing any such trademark. Such right and license is granted
free of charge, without the requirement that any monetary payment whatsoever be
made to the Borrowers or any other Person by the Lenders or the Administrative
Agent or any purchaser or purchasers of the Collateral. The Borrowers hereby
represent, warrant, covenant and agree that they presently have, and shall
continue to have, the right, without the approval or consent of others, to grant
the license set forth in this SECTION 12.6.
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ARTICLE 13
ASSIGNMENTS
SECTION 13.1 Successors and Assigns; Participations.
(a) This Agreement shall be binding upon and inure to the
benefit of the Borrowers, the Lenders, the Administrative Agent, all future
holders of the Notes, and their respective successors and assigns, except that
the Borrowers may not assign or transfer any of their rights or obligations
under this Agreement without the prior written consent of each Lender.
(b) Each Lender may with the consent of the Administrative
Agent and, so long as no Default or Event of Default has occurred and is
continuing, Xxxxxxx (which consent shall not be unreasonably withheld) assign to
one or more Eligible Assignees all or a portion of its interests, rights and
obligations under this Agreement (including, without limitation, all or a
portion of the Loans at the time owing to it and the Notes held by it) (PROVIDED
that no consent shall be required with respect to any assignment to an Eligible
Assignee as part of the assigning Lender's transfer of all or substantially all
of its assets of a similar type in connection with any acquisition or
divestiture or otherwise); PROVIDED, HOWEVER, that (i) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Lender's rights and obligations under this Agreement, (ii) the amount of the
Commitment of the assigning Lender that is subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall in no event be less
than the Minimum Commitment (or the assigning Lender's entire remaining
Commitment, if less) (except that a Lender may assign less than the Minimum
Commitment to its Affiliate), (iii) in the case of a partial assignment, the
amount of the Commitment that is retained by the assigning Lender (determined as
of the date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent) shall in no event be less than the
Minimum Commitment, (iv) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording in the
Register an Assignment and Acceptance, together with any Note or Notes subject
to such assignment and an assignment fee in the amount of $2,500, (v) such
assignment shall not, without the consent of the Borrowers, require the
Borrowers to file a registration statement with the Securities and Exchange
Commission or apply to or qualify the Loans or the Notes under the blue sky laws
of any state, and (vi) the representation contained in SECTION 13.2 hereof shall
be true with respect to any such proposed assignee. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
Business Days after the execution thereof, (A) the assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder, and (B) the Lender
assignor thereunder shall, to the extent provided in such assignment, be
released from its obligations under this Agreement.
(c) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, such Lender
assignor makes no representation or warranty and assumes no responsibility with
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respect to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
instrument or document furnished pursuant hereto; (ii) such Lender assignor
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrowers or the performance or observance by
the Borrowers of any of their obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in SECTION 6.1(N) and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such Lender
assignor or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement and the other Loan Documents as are delegated
to the Administrative Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a Lender.
(d) The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders and the Commitment and Proportionate
Share of, and principal amount of the Loans and owing to, each Lender from time
to time (the "Register"). The entries in the Register shall be conclusive, in
the absence of manifest error, and the Borrowers, the Administrative Agent and
the Lenders may treat each person whose name is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrowers or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an Eligible Assignee together with any Note or Notes
and evidence satisfactory to the Administrative Agent of the Borrowers' consent
thereto (if applicable), subject to such assignment, the Administrative Agent
shall, if such Assignment and Acceptance has been completed and is in the form
of EXHIBIT C, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register, (iii) give prompt notice thereof
to the Lenders and the Borrowers, and (vi) promptly deliver a copy of such
Acceptance and Assignment to the Borrowers. Within five Business Days after
receipt of notice, the Borrowers shall execute and deliver to the Administrative
Agent in exchange for the surrendered Note or Notes a new Note or Notes to the
order of such Eligible Assignee in amounts equal to the Commitment assumed by
such Eligible Assignee pursuant to such Assignment and Acceptance and a new Note
or Notes to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and Acceptance and shall otherwise be in
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substantially the form of the assigned Notes. Each surrendered Note or Notes
shall be canceled and returned to the Borrowers.
(f) Each Lender may sell participations to one or more banks
or other entities in all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment
hereunder and the Loans owing to it and the Notes held by it); PROVIDED,
HOWEVER, that (i) each such participation (other than to a Lender's own
Affiliate) shall be in an amount not less than the Minimum Commitment, (ii) such
Lender's obligations under this Agreement (including, without limitation, its
Commitment hereunder) shall remain unchanged, (iii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iv) such Lender shall remain the holder of the Notes held by it
for all purposes of this Agreement, (v) the Borrowers, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement; PROVIDED, that such Lender may agree with any participant that such
Lender will not, without such participant's consent, agree to or approve any
waivers or amendments which would reduce the principal of or the interest rate
on any Loans, extend the term or increase the amount of the commitments of such
participant, reduce the amount of any fees to which such participant is
entitled, extend any scheduled payment date for principal or release Collateral
securing the Loans (other than Collateral disposed of pursuant to SECTION 8.7
hereof or otherwise in accordance with the terms of this Agreement or the
Security Documents), and (vi) any such disposition shall not, without the
consent of the Borrowers, require any Borrower to file a registration statement
with the Securities and Exchange Commission to apply to qualify the Loans or the
Notes under the blue sky law of any state. The Lender selling a participation to
any bank or other entity that is not an Affiliate of such Lender shall give
prompt notice thereof to the Administrative Agent, the other Lenders and the
Borrowers.
(g) Any Lender may, in connection with any assignment,
proposed assignment, participation or proposed participation pursuant to this
SECTION 13.1, disclose to the assignee, participant, proposed assignee or
proposed participant, any information relating to the Borrowers furnished to
such Lender by or on behalf of the Borrowers, PROVIDED that, prior to any such
disclosure, each such assignee, proposed assignee, participant or proposed
participant shall agree with the Borrowers or such Lender (which in the case of
an agreement with only such Lender, the Borrowers shall be recognized as third
party beneficiaries thereof) to preserve the confidentiality of any confidential
information relating to the Borrowers received from such Lender.
SECTION 13.2 Representation of Lenders. Each Lender hereby
represents that it will make each Loan hereunder as a commercial loan for its
own account in the ordinary course of its business; PROVIDED, HOWEVER, that
subject to SECTION 13.1 hereof, the disposition of the Notes or other evidence
of the Secured Obligations held by any Lender shall at all times be within its
exclusive control.
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ARTICLE 14
AGENT
SECTION 14.1 Appointment of Administrative Agent. Each Lender
hereby irrevocably designates and appoints (1) FCC as the Administrative Agent
of such Lender and (2) Bank of America as the Syndication Agent and FUNB as the
Documentation Agent under this Agreement and the other Loan Documents, and each
Lender irrevocably authorizes the Administrative Agent, as the Administrative
Agent for such Lender, to take such action on its behalf under the provisions of
this Agreement and the other Loan Documents and to exercise such powers and
perform such duties as are expressly delegated to the Administrative Agent by
the terms of this Agreement and such other Loan Documents, including, without
limitation, to make determinations as to the eligibility of Inventory and
Receivables, to establish Additional Reserves and to adjust the advance ratios
contained in the definition of "Borrowing Base" (so long as such advance ratios,
as adjusted, do not exceed those set forth in the definition of "Borrowing Base"
as of the Agreement Date), together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement or the other Loan Documents, the Administrative Agent shall not
have any duties or responsibilities except those expressly set forth herein and
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or the other Loan Documents or otherwise exist
against the Administrative Agent.
SECTION 14.2 Delegation of Duties. The Administrative Agent
may execute any of its duties under this Agreement and the other Loan Documents
by or through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care. The Administrative Agent
hereby appoints, authorizes and directs each Lender to act as collateral
sub-agent for the Administrative Agent for the purposes of perfecting security
interests and Liens in Collateral held by such Lender.
SECTION 14.3 Exculpatory Provisions. Neither the
Administrative Agent nor any of its trustees, officers, directors, employees,
agents, attorneys-in-fact or Affiliates shall be (i) liable to any Lender (or
any Lender's participants) for any action lawfully taken or omitted to be taken
by it or such Person under or in connection with this Agreement or the other
Loan Documents (except for its or such Person's, as the case may be, own gross
negligence or willful misconduct), or (ii) responsible in any manner to any
Lender (or any Lender's participants) for any recitals, statements,
representations or warranties made by the Borrowers or any of its Subsidiaries,
any Affiliate thereof or any other Person or any officer thereof contained in
this Agreement or the other Loan Documents or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or the other
Loan Documents or for the existence, value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the other Loan
Documents or any Collateral or the Security Interest or other Lien or other
interest therein or for any failure of the Borrowers, or any Subsidiary of the
Borrower or any Affiliate of the Borrowers to perform its obligations hereunder
or thereunder. The Administrative Agent shall
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not be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement, or to inspect the properties, books or records of the
Borrowers.
SECTION 14.4 Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any Note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order 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, without
limitation, counsel to the Borrowers), independent accountants and other experts
selected by the Administrative Agent. The Administrative Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless such
Note shall have been transferred in accordance with SECTION 13.1. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement and the other Loan Documents unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and shall be indemnified to its satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Agreement and the Notes in accordance with a request of the Required Lenders (or
all Lenders if such action or inaction would have the effect of amending or
waiving a breach of any provision of this Agreement that only all the Lenders
may amend or waive in accordance with the provisions of SECTION 15.9(B)), and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Notes.
SECTION 14.5 Notice of Default. The Administrative Agent shall
not be deemed to have knowledge or notice of the occurrence of any Default or
Event of Default hereunder unless the Administrative Agent has received notice
from a Lender or the Borrowers referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default". In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall promptly give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be directed by the Required Lenders; PROVIDED that
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) continue making
Loans to the Borrowers on behalf of the Lenders in reliance on the provisions of
SECTION 4.7 and take such other action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable and in
the best interests of the Lenders.
SECTION 14.6 Non-Reliance on Administrative Agent and Other
Lenders. Each Lender expressly acknowledges that none of the Administrative
Agent, the Syndication Agent nor the Documentation Agent nor any of their
respective officers, directors, counsel, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
the Administrative Agent, the Syndication Agent or the Documentation Agent
hereafter taken, including any review of the affairs of the Borrowers, any
Subsidiary or any Affiliate of the Borrowers, shall be deemed to constitute any
representation or warranty by the Administrative Agent, the Syndication Agent or
the Documentation Agent to any Lender. Each Lender represents to the
Administrative Agent, the Syndication Agent and the Documentation
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Agent that it has, independently and without reliance upon the Administrative
Agent, the Syndication Agent or the Documentation Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
financial (and other) condition and creditworthiness of the Borrowers and the
Subsidiaries, and made its own decision to make its Loans hereunder and enter
into this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Administrative Agent or any Co-Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigation as it deems necessary to inform itself
as to the business, operations, property, financial (and other) condition and
creditworthiness of the Borrowers and the Subsidiaries. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder or under the other Loan Documents none of the
Administrative Agent, the Syndication Agent nor the Documentation Agent shall
have any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, financial (and other)
condition or creditworthiness of the Borrowers or the Subsidiaries or the
Affiliates of the Borrowers which may come into the possession of the
Administrative Agent, the Syndication Agent or the Documentation Agent or any of
their respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
SECTION 14.7 Indemnification.
(a) The Lenders agree to indemnify the Administrative Agent in
its capacity as such (to the extent not reimbursed by the Borrowers and without
limiting the obligation of the Borrowers or any other Person to do so), Ratably
according to their respective Commitment Percentages, from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, attorneys' fees, costs, expenses or disbursements of any kind whatsoever
which may at any time (including, without limitation, at any time following the
payment of the Notes) be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of this Agreement or
the other Loan Documents, or any documents contemplated by or referred to herein
or therein or the transactions contemplated hereby or thereby or any action
taken or omitted by the Administrative Agent under or in connection with any of
the foregoing; PROVIDED that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, attorneys' fees, costs, expenses or disbursements resulting
from the Administrative Agent's gross negligence or willful misconduct or
resulting solely from transactions or occurrences that occur at a time after
such Lender has assigned all of its interests, rights and obligations under this
Agreement pursuant to SECTION 13.1 or, in the case of a Lender to which an
assignment is made hereunder pursuant to SECTION 13.1, at a time before such
assignment. The agreements in this SECTION 14.7 shall survive the payment of the
Notes, the Secured Obligations and all other amounts payable hereunder and the
termination of this Agreement.
(b) Without limiting the generality of the foregoing
provisions of this SECTION 14.7, if the Administrative Agent should be sued by
any receiver, trustee in bankruptcy, debtor-in-possession or other Person on
account of any alleged preference or fraudulent transfer received or alleged to
have been received from the Borrowers, any Subsidiary or any other
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Person as the result of any transaction under the Loan Documents, then any
monies paid by the Administrative Agent in settlement or satisfaction of such
suit, together with all costs and expenses (including attorneys' fees and
expenses) incurred by Administrative Agent in the defense of same, shall be
promptly reimbursed to the Administrative Agent by the Lenders to the extent of
each Lender's Proportionate Share.
(c) Further, without limiting the generality of the foregoing
provisions of this SECTION 14.7, if at any time (whether prior to or after the
Termination Date) any action or proceeding shall be brought against the
Administrative Agent by the Borrowers, any Subsidiary, or by any other Person
claiming by, through or under the Borrowers or any Subsidiary, to recover
damages for any action taken or omitted by the Administrative Agent under any of
the Loan Documents or in the performance of any rights, powers or remedies of
the Administrative Agent against the Borrowers, any Account Debtor, any
Subsidiary, the Collateral or with respect to any Loans, or to obtain any other
relief of any kind on account of any transaction between the Administrative
Agent and the Borrowers, any Subsidiary or any other Person under or in relation
to any of the Loan Documents, the Lenders agree to indemnify and hold the
Administrative Agent harmless with respect thereto and to pay to Administrative
Agent their respective Proportionate Shares of such amount as the Administrative
Agent shall be required to pay by reason of a judgment, decree or other order
entered in such action or proceeding or by reason of any compromise or
settlement agreed to by the Administrative Agent, including all interest and
costs assessed against the Administrative Agent in defending or compromising
such action, together with attorneys' fees and other legal expenses paid or
incurred by the Administrative Agent in connection therewith; PROVIDED, HOWEVER,
that no Lender shall be liable to the Administrative Agent for any of the
foregoing to the extent that they arise from the willful misconduct or gross
negligence of the Administrative Agent. In the Administrative Agent's
discretion, the Administrative Agent may also reserve for or satisfy any such
judgment, decree or order from proceeds of Collateral prior to any distributions
therefrom to or for the account of Lenders.
SECTION 14.8 Administrative Agent in Its Individual Capacity.
The institution at the time acting as the Administrative Agent and its
Affiliates may make loans to, issue or cause to be issued letters of credit to
or for the account of, accept deposits from and generally engage in any kind of
business with the Borrowers, any Subsidiary or any Affiliate of the Borrowers as
if it were not the Administrative Agent hereunder. With respect to its
Commitment, the Loans made or renewed by it and any Note issued to it and any
Letter of Credit or Letter of Credit Guarantee issued by it, such institution
shall have and may exercise the same rights and powers under this Agreement and
the other Loan Documents and shall be subject to the same obligations and
liabilities as and to the extent set forth herein and in the other Loan
Documents for any other Lender. The terms "Lenders" and "Required Lenders" or
any other term shall, unless the context clearly otherwise indicates, include
such institution in its individual capacity as a Lender or one of the Required
Lenders.
SECTION 14.9 Successor Collateral Administrative Agent.
(a) The Administrative Agent may resign as Administrative
Agent upon 30 days' notice to the Lenders and the Borrowers or may be removed by
the Lenders (other than the Lender who is also the Administrative Agent), or, if
there are more than two other Lenders by the
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Lenders whose Commitment Percentages equal at least 51% of the total Commitment
Percentage of all other Lenders; PROVIDED, HOWEVER that such resignation shall
not take effect until a successor agent has been appointed. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
or be removed, then the Required Lenders shall appoint from among the Lenders a
successor agent for the Lenders and, so long as no Event of Default has occurred
and is continuing, subject to approval by Xxxxxxx (which approval shall not be
unreasonably withheld), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon its
appointment, and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Notes. If the Required Lenders have failed
to appoint a successor Administrative Agent within 30 days of the resignation
notice given by the Administrative Agent as provided above, then the
Administrative Agent shall be entitled to appoint a successor agent from among
the Lenders, subject, so long as no Event of Default has occurred and is
continuing, to approval by Xxxxxxx (which approval shall not be unreasonably
withheld). After any retiring Administrative Agent's resignation hereunder as
Administrative Agent or the removal of any Administrative Agent, the provisions
of SECTION 14.7 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement.
(b) It is intended that there shall be no violation of any
Applicable Law denying or restricting the right of financial institutions to
transact business as agent in any jurisdiction. It is recognized that, in case
of litigation under any of the Loan Documents, or in case the Administrative
Agent deems that by reason of present or future laws of any jurisdiction the
Administrative Agent might be prohibited from or restricted in exercising any of
the powers, rights or remedies granted to the Administrative Agent or the
Lenders hereunder or under any of the Loan Documents or from holding title to or
a Lien upon any Collateral or from taking any other action which may be
necessary or desirable hereunder or under any of the Loan Documents, the
Administrative Agent may appoint an additional individual or institution as a
separate collateral agent or co-collateral agent which is not so prohibited from
or restricted in taking any of such actions or exercising any of such powers,
rights or remedies. If the Administrative Agent shall appoint an additional
individual or institution as a separate collateral agent or co-collateral agent
as provided above, each and every remedy, power, right, claim, demand or cause
of action intended by any of the Loan Documents to be exercised by or vested in
or conveyed to the Administrative Agent with respect thereto shall be
exercisable by and vested in such separate collateral agent or co-collateral
agent, but only to the extent necessary to enable such separate collateral agent
or co-collateral agent to exercise such powers, rights and remedies, and every
covenant and obligation necessary to the exercise thereof by such separate
collateral agent or co-collateral agent shall run to and be enforceable by
either of them. Should any instrument from the Lenders be required by the
separate collateral agent or co-collateral agent so appointed by Administrative
Agent in order more fully and certainly to vest in and confirm to him or it such
rights, powers, duties and obligations, including without limitation
indemnification of such collateral agent or co-collateral agent, any and all of
such instruments shall, on request, be executed, acknowledged and delivered by
the Lenders. In case any separate collateral agent or co-collateral agent, or a
successor to either, shall die, become incapable of acting, resign or be
removed, all the estates, properties, rights, powers, duties and obligations of
such separate collateral agent or co-collateral agent, so far as permitted by
Applicable Law, shall
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vest in and be exercised by the Administrative Agent until the appointment of a
new collateral agent or successor to such separate collateral agent or
co-collateral agent.
SECTION 14.10 Notices from Administrative Agent to Lenders.
The Administrative Agent shall promptly, upon receipt thereof, forward to each
Lender copies of any updated Schedules and of any written notices, reports or
other information supplied to it by the Borrowers or any Subsidiary (but which
such Person is not required to supply directly to the Lenders). Except to the
extent expressly provided in this Agreement or in the other Loan Documents, the
Administrative Agent shall not be obligated to deliver or disclose to any Lender
any of the Administrative Agent's internal reports, analysis or investigation or
any records or other information in its possession relating to the Borrowers or
any of the Subsidiaries or the Affiliates of the Borrowers.
SECTION 14.11 Declaring Events of Default. Upon the occurrence
of a Default, the Administrative Agent may, and at the direction of the Required
Lenders shall, give such notice or take such other action as may be required
hereunder to declare an Event of Default.
SECTION 14.12 Syndication Agent and Documentation Agent. For
avoidance of doubt, it is expressly acknowledged and agreed by the
Administrative Agent and each Lender for the benefit of each of the Syndication
Agent and the Documentation Agent that, other than any rights or obligations
explicitly reserved to or imposed upon the Syndication Agent and the
Documentation Agent under this Agreement, neither the Syndication Agent nor the
Documentation Agent, in such capacity, has any rights or obligations hereunder
nor shall the Syndication Agent or the Documentation Agent, in such capacity, be
responsible or accountable to any other party hereto for any action or failure
to act hereunder, other than in connection with such explicitly reserved rights
or such obligations and then only for claims, damages, losses (other than
consequential losses) and other liabilities arising out of such Person's own
gross negligence or willful misconduct.
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ARTICLE 15
MISCELLANEOUS
SECTION 15.1 Notices.
(a) Method of Communication. Except as specifically provided
in this Agreement or in any of the Loan Documents, all notices and the
communications hereunder and thereunder shall be in writing or by telephone
subsequently confirmed in writing. Notices in writing shall be delivered
personally or sent by certified or registered mail, postage pre-paid, or by
overnight courier, telex or facsimile transmission and shall be deemed received
in the case of personal delivery, when delivered, in the case of mailing, when
receipted for, in the case of overnight delivery, on the next Business Day after
delivery to the courier, and in the case of telex and facsimile transmission,
upon transmittal, provided that in the case of notices to the Administrative
Agent, notice shall be deemed to have been given only when such notice is
actually received by the Administrative Agent. A telephonic notice to the
Administrative Agent, as understood by the Administrative Agent, will be deemed
to be the controlling and proper notice in the event of a discrepancy with or
failure to receive a confirming written notice.
(b) Addresses for Notices. Notices to any party shall be sent
to it at the following addresses, or any other address of which all the other
parties are notified in writing by such first party:
If to the Borrowers: Xxxxxxx Tire Group, Inc.
0000 Xxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
with a copy to: J. Xxxxxxx Xxxxxxx, Esq.
Xxxxxxx Tire Group, Inc.
0000 Xxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
If to the
Administrative Agent: Fleet Capital Corporation
000 Xxxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. XxXxxxx
Facsimile No.: (000) 000-0000
If to a Lender: At the address of such Lender set
forth on the signature pages hereof.
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(c) Administrative Agent's Office. The Administrative Agent
hereby designates its office located at 000 Xxxxxxxx Xxxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxx 00000, or any subsequent office which shall have been specified
for such purpose by written notice to the Borrowers, as the office to which
payments due are to be made.
SECTION 15.2 Expenses. The Borrowers agree, jointly and
severally, to pay or reimburse on demand all costs and expenses reasonably
(other than pursuant to subsection (b) below as to which such requirement shall
not apply) incurred
(a) by or on behalf of the Administrative Agent, including,
without limitation, the reasonable fees and disbursements of counsel, in
connection with
(i) the negotiation, preparation, execution,
delivery, administration, enforcement and termination of this
Agreement and each of the other Loan Documents, whenever the
same shall be executed and delivered, including, without
limitation
(A) reasonable out-of-pocket costs and
expenses incurred in connection with the
administration and interpretation of this Agreement
and the other Loan Documents;
(B) reasonable costs and expenses of
appraisals of the Collateral;
(C) the costs and expenses of lien searches;
and
(D) taxes, fees and other charges for filing
the Financing Statements and continuations and the
costs and expenses of taking other actions to
perfect, protect, and continue the Security
Interests;
(ii) the preparation, execution and delivery of any
waiver, amendment, supplement or consent by the Administrative
Agent and the Lenders relating to this Agreement or any of the
Loan Documents;
(iii) sums paid or incurred to pay any amount or take
any action required of the Borrowers under the Loan Documents
that the Borrowers fail to pay or take;
(iv) costs of inspections and verifications of the
Collateral, including, without limitation, standard per diem
fees charged by the Administrative Agent or the Lenders,
travel, lodging, and meals for inspections of the Collateral
and the Borrowers' operations and books and records by the
Administrative Agent's and/or the Lenders' agents up to two
times per year and whenever an Event of Default exists;
(v) costs and expenses of forwarding loan proceeds,
collecting checks and other items of payment, and establishing
and maintaining each Controlled Disbursement Account, Agency
Account and Lockbox; and
(vi) costs and expenses of preserving and protecting
the Collateral; and
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(b) by or on behalf of the Administrative Agent or any Lender
in connection with
(i) consulting, after the occurrence of a Default,
with one or more Persons, including appraisers, accountants
and lawyers, concerning the value of any Collateral for the
Secured Obligations or related to the nature, scope or value
of any right or remedy of the Administrative Agent or any
Lender hereunder or under any of the Loan Documents, including
any review of factual matters in connection therewith, which
expenses shall include the fees and disbursements of such
Persons; and
(ii) costs and expenses paid or incurred to obtain
payment of the Secured Obligations, enforce the Security
Interests, sell or otherwise realize upon the Collateral, and
otherwise enforce the provisions of the Loan Documents, or to
prosecute or defend any claim in any way arising out of,
related to or connected with, this Agreement or any of the
Loan Documents, which expenses shall include the reasonable
fees and disbursements of counsel and of experts and other
consultants retained by the Administrative Agent or any
Lender.
The foregoing shall not be construed to limit any other provisions of the Loan
Documents regarding costs and expenses to be paid by the Borrowers. The
Borrowers hereby authorize the Administrative Agent and the Lenders to debit the
Borrowers' Loan Accounts (by increasing the principal amount of the Loans) in
the amount of any such costs and expenses owed by the Borrowers when due.
SECTION 15.3 Stamp and Other Taxes. The Borrowers will pay any
and all stamp, registration, recordation and similar taxes, fees or charges and
shall indemnify the Administrative Agent and the Lenders against any and all
liabilities with respect to or resulting from any delay in the payment or
omission to pay any such taxes, fees or charges, which may be payable or
determined to be payable in connection with the execution, delivery, performance
or enforcement of this Agreement and any of the Loan Documents or the perfection
of any rights or security interest thereunder, including, without limitation,
the Security Interest.
SECTION 15.4 Setoff. In addition to any rights now or
hereafter granted under Applicable Law and not by way of limitation of any such
rights, during the continuance of any Event of Default, each Lender, any
participant with such Lender in the Loans and each Affiliate of each Lender are
hereby authorized by the Borrowers at any time or from time to time, without
notice to the Borrowers or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and to apply any and all
deposits (general or special, including, but not limited to, indebtedness
evidenced by certificates of deposit, whether matured or unmatured) and any
other indebtedness at any time held or owing by any Lender or any Affiliate of
any Lender or any participant to or for the credit or the account of the
Borrowers against and on account of the Secured Obligations irrespective or
whether or not
(a) the Administrative Agent or such Lender shall have made
any demand under this Agreement or any of the Loan Documents, or
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(b) the Administrative Agent or such Lender shall have
declared any or all of the Secured Obligations to be due and payable as
permitted by SECTION 12.2 and although such Secured Obligations shall be
contingent or unmatured.
SECTION 15.5 Consent to Advertising and Publicity. With the
prior written consent of the Borrowers, which consent shall not be unreasonably
withheld, the Administrative Agent, on behalf of the Lenders, may issue and
disseminate to the public information describing the credit accommodation
entered into pursuant to this Agreement, including the name and address of the
Borrowers, the amount, interest rate, maturity, collateral for and a general
description of the credit facilities provided hereunder and of the Borrowers'
business.
SECTION 15.6 Reversal of Payments. The Administrative Agent
and each Lender shall have the continuing and exclusive right to apply, reverse
and re-apply any and all payments to any portion of the Secured Obligations in a
manner consistent with the terms of this Agreement. To the extent the Borrowers
make a payment or payments to the Administrative Agent, for the account of the
Lenders, or any Lender receives any payment or proceeds of the Collateral for
the Borrowers' benefit, which payment(s) or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds received, the Secured Obligations or part
thereof intended to be satisfied shall be revived and continued in full force
and effect, as if such payment or proceeds had not been received by the
Administrative Agent or such Lender.
SECTION 15.7 Injunctive Relief. The Borrowers recognize that,
in the event the Borrowers fail to perform, observe or discharge any of their
obligations or liabilities under this Agreement, any remedy at law may prove to
be inadequate relief to the Administrative Agent and the Lenders; therefore, the
Borrowers agree that if any Event of Default shall have occurred and be
continuing, the Administrative Agent and the Lenders, if the Administrative
Agent or any Lender so requests, shall be entitled to temporary and permanent
injunctive relief without the necessity of proving actual damages.
SECTION 15.8 Accounting Matters. All financial and accounting
calculations, measurements and computations made for any purpose relating to
this Agreement, including, without limitation, all computations utilized by the
Borrowers to determine whether they are in compliance with any covenant
contained herein, shall, unless this Agreement otherwise provides or unless
Required Lenders shall otherwise consent in writing, be performed in accordance
with GAAP.
SECTION 15.9 Amendments.
(a) Except as set forth in SUBSECTION (B) below, any term,
covenant, agreement or condition of this Agreement or any of the other Loan
Documents may be amended or waived, and any departure therefrom may be consented
to by the Required Lenders, if, but only if, such amendment, waiver or consent
is in writing signed by the Required Lenders and, in the case of an amendment
(other than an amendment described in SECTION 15.9(D)), by the
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Borrowers, PROVIDED that no such amendment, unless consented to by the
Administrative Agent, shall alter or affect the rights or responsibilities of
the Administrative Agent, and in any such event, the failure to observe, perform
or discharge any such term, covenant, agreement or condition (whether such
amendment is executed or such waiver or consent is given before or after such
failure) shall not be construed as a breach of such term, covenant, agreement or
condition or as a Default or an Event of Default. Unless otherwise specified in
such waiver or consent, a waiver or consent given hereunder shall be effective
only in the specific instance and for the specific purpose for which given. In
the event that any such waiver or amendment is requested by the Borrowers, the
Administrative Agent and the Lenders may require and charge a fee in connection
therewith and consideration thereof in such amount as shall be determined by the
Administrative Agent and the Required Lenders in their discretion.
(b) Without the prior unanimous written consent of the
Lenders,
(i) no amendment, consent or waiver shall (A) affect
the amount or extend the time of any Lender's obligation to
make Loans or (B) extend the originally scheduled time or
times of payment of the principal of any Loan or (C) alter the
time or times of payment of interest on any Loan or of any
fees payable for the account of the Lenders or (D) alter the
amount of the principal of any Loan or the rate of interest
thereon (except with respect to application of the Default
Margin under SECTION 5.1(D)) or (E) alter the amount of any
commitment fee or other fee payable hereunder for the account
of the Lenders or (F) permit any subordination of the
principal of or interest on any Loan or (G) permit the
subordination of the Security Interests in any Collateral,
(ii) no Collateral having an aggregate value greater
than $250,000 shall be released by the Administrative Agent in
any 12-month period other than as specifically permitted in
this Agreement or the Security Documents nor shall any
Collateral be released at a time when the Administrative Agent
is entitled to exercise remedies hereunder upon default, nor
shall any Borrower or material Guarantor be released from its
liability for the Secured Obligations,
(iii) except to the extent expressly provided in
SECTIONS 4.7 and 14.1, no amendment shall be made to the
definition of any of the following terms, "Applicable Margin",
"Borrowing Base" (except as otherwise expressly contemplated
hereunder) and the defined terms used in such definition,
"Eligible Assignee", "Proportionate Share", "Ratable",
"Ratable Share", "Commitment
Percentage", "Secured Obligations", or "Commitment",
(iv) none of the provisions of this SECTION 15.9, the
definitions "Lenders" or "Required Lenders", or the provisions
of ARTICLE 12 shall be amended,
(v) neither the Administrative Agent nor any Lender
shall consent to any amendment to or waiver of the
amortization, deferral or subordination provisions of any
instrument or agreement evidencing or relating to obligations
(whether or not Debt) of the Borrowers that are expressly
subordinate to any of the Secured
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Obligations if such amendment or waiver would be adverse to
the Lenders in their capacities as Lenders hereunder;
(vi) no amendment shall be made to any provision in
ARTICLE 14, and
(vii) no extension of the Termination Date shall be
effected;
PROVIDED, HOWEVER, that anything herein to the contrary notwithstanding, the
Required Lenders shall have the right to waive any Default or Event of Default
and the consequences hereunder of such Default or Event of Default provided only
that such Default or Event of Default does not arise under SECTION 12.1(G) OR
(H) or out of a breach of or failure to perform or observe any term, covenant or
condition of this Agreement or any other Loan Document (other than the
provisions of ARTICLE 12 of this Agreement) the amendment of which requires the
unanimous consent of the Lenders. The Required Lenders shall have the right,
with respect to any Default or Event of Default that may be waived by them, to
enter into an agreement with the Borrowers providing for the forbearance from
the exercise of any remedies provided hereunder or under the other Loan
Documents without thereby waiving any such Default or Event of Default.
(c) The making of Loans hereunder by the Lenders during the
existence of a Default or Event of Default shall not be deemed to constitute a
waiver of such Default or Event of Default.
(d) Notwithstanding any provision of this Agreement or the
other Loan Documents to the contrary, no consent, written or otherwise, of the
Borrowers shall be necessary or required in connection with any amendment to
ARTICLE 14 or SECTION 4.8, and any amendment to such provisions may be effected
solely by and among the Administrative Agent and the Lenders, PROVIDED that no
such amendment shall impose any obligation on the Borrowers or limit or reduce
any right granted hereunder or thereunder to the Borrowers.
SECTION 15.10 Assignment. All 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 Borrowers may not assign or
transfer any of their rights under this Agreement.
SECTION 15.11 Performance of Borrowers' Duties.
(a) The Borrowers' obligations under this Agreement and each
of the Loan Documents shall be performed by the Borrowers at their sole cost and
expense.
(b) If the Borrowers shall fail to do any act or thing which
they have covenanted to do under this Agreement or any of the Loan Documents,
the Administrative Agent, on behalf of the Lenders, may (but shall not be
obligated to) do the same or cause it to be done either in the name of the
Administrative Agent or the Lenders or in the name and on behalf of the
Borrowers, and each Borrower hereby irrevocably authorizes the Administrative
Agent so to act.
SECTION 15.12 Indemnification. The Borrowers agree to
reimburse the Administrative Agent and the Lenders for all costs and expenses,
including reasonable counsel
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fees and disbursements, incurred, and to indemnify and hold harmless the
Administrative Agent and the Lenders from and against all losses suffered by,
the Administrative Agent or any Lender in connection with
(a) the exercise by the Administrative Agent or any Lender of
any right or remedy granted to it under this Agreement or any of the Loan
Documents,
(b) any claim, and the prosecution or defense thereof, arising
out of or in any way connected with this Agreement or any of the Loan Documents,
and
(c) the collection or enforcement of the Secured Obligations
or any of them,
other than such costs, expenses and liabilities arising out of the
Administrative Agent's or any Lender's gross negligence or willful misconduct.
SECTION 15.13 All Powers Coupled with Interest. All powers of
attorney and other authorizations granted to the Administrative Agent and the
Lenders and any Persons designated by the Administrative Agent or the Lenders
pursuant to any provisions of this Agreement or any of the Loan Documents shall
be deemed coupled with an interest and shall be irrevocable so long as any of
the Secured Obligations remain unpaid or unsatisfied.
SECTION 15.14 Survival. Notwithstanding any termination of
this Agreement,
(a) until all Secured Obligations have been irrevocably paid
in full or otherwise satisfied, the Administrative Agent, for the benefit of the
Lenders, shall retain its Security Interest and shall retain all rights under
this Agreement and each of the Security Documents with respect to such
Collateral as fully as though this Agreement had not been terminated,
(b) the indemnities to which the Administrative Agent and the
Lenders are entitled under the provisions of this ARTICLE 15 and any other
provision of this Agreement and the Loan Documents shall continue in full force
and effect and shall protect the Administrative Agent and the Lenders against
events arising after such termination as well as before, and
(c) in connection with the termination of this Agreement and
the release and termination of the Security Interests, the Administrative Agent,
on behalf of itself as agent and the Lenders, may require such assurances and
indemnities as it shall reasonably deem necessary or appropriate to protect the
Administrative Agent and the Lenders against loss on account of such release and
termination, including, without limitation, with respect to credits previously
applied to the Secured Obligations that may subsequently be reversed or revoked.
SECTION 15.15 Titles and Captions. Titles and captions of
Articles, Sections and subsections in this Agreement are for convenience only,
and neither limit nor amplify the provisions of this Agreement.
SECTION 15.16 Severability of Provisions. Any provision of
this Agreement or any Loan Document which is prohibited or unenforceable in any
jurisdiction shall,
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as to such jurisdiction, be ineffective only to the extent of such prohibition
or unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or thereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 15.17 Governing Law; Waiver of Jury Trial.
(a) This Agreement and the Notes shall be governed by and
construed in accordance with the laws of the State of New York.
(b) Each Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court for the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the
extent permitted by law, in such federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, any Issuing Bank, FCC as issuer of any
Letter of Credit Guarantee or any Lender may otherwise have to bring any action
or proceeding relating to this Agreement or the other Loan Documents against any
Borrower or its properties in the courts of any jurisdiction.
(c) Each Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or the other
Loan Documents in any court referred to in PARAGRAPH (B) of this Section. Each
of the parties hereto hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in SECTION 15.1. Nothing
in this Agreement will affect the right of any party to this Agreement to
service of process in any other manner permitted by law.
(e) Each Borrower, the Administrative Agent and each Lender
hereby knowingly, intentionally and voluntarily waive trial by jury in any
action or proceeding of any kind or nature in any court in which an action may
be commenced by or against a Borrower, the Administrative Agent or such Lender
arising out of this Agreement, the Collateral or any assignment thereof or by
reason of any other cause or dispute whatsoever between the Borrowers and the
Administrative Agent or any Lender of any kind or nature.
SECTION 15.18 Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and shall be binding upon all parties, their
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successors and assigns, and all of which taken together shall constitute one and
the same agreement.
SECTION 15.19 Reproduction of Documents. This Agreement, each
of the Loan Documents and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by the Administrative Agent or any Lender, and
(c) financial statements, certificates and other information previously or
hereafter furnished to the Administrative Agent or any Lender, may be reproduced
by the Administrative Agent or such Lender by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process and such
Person may destroy any original document so produced. Each party hereto
stipulates that, to the extent permitted by Applicable Law, any such
reproduction shall be as admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original shall be in
existence and whether or not such reproduction was made by the Administrative
Agent or such Lender in the regular course of business), and any enlargement,
facsimile or further reproduction of such reproduction shall likewise be
admissible in evidence.
SECTION 15.20 Term of Agreement. This Agreement shall remain
in effect from the Agreement Date through the Termination Date and thereafter
until all Secured Obligations shall have been irrevocably paid and satisfied in
full. No termination of this Agreement shall affect the rights and obligations
of the parties hereto arising prior to such termination.
SECTION 15.21 Increased Capital. If any Lender shall have
determined that the adoption of any applicable law, rule, regulation, guideline,
directive or request (whether or not having force of law) regarding capital
requirements for banks or bank holding companies, or any change therein or in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, in each case after the Agreement Date, or compliance by
such Lender with any of the foregoing, imposes or increases a requirement by
such Lender to allocate capital resources to such Lender's Commitment to make
Loans hereunder which has or would have the effect of reducing the return on
such Lender's capital to a level below that which such Lender could have
achieved (taking into consideration such Lender's then existing policies with
respect to capital adequacy and assuming full utilization of such Lender's
capital) but for such adoption, change or compliance by any amount deemed by
such Lender to be material: (i) such Lender shall promptly after its
determination of such occurrence give notice thereof to the Borrower; and (ii)
the Borrowers shall pay to such Lender as an additional fee from time to time on
demand such amount as such Lender certifies to be the amount that will
compensate it for such reduction. A certificate of such Lender claiming
compensation under this SECTION 15.21 shall be conclusive in the absence of
manifest error. Such certificate shall set forth the nature of the occurrence
giving rise to such compensation, the additional amount or amounts to be paid to
it hereunder and the method by which such amounts were determined. In
determining such amount, such Lender may use any reasonable averaging and
attribution methods.
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SECTION 15.22 Pro-Rata Participation.
(a) Each Lender agrees that if, as a result of the exercise of
a right of setoff, banker's lien or counterclaim or other similar right or the
receipt of a secured claim it receives any payment in respect of the Secured
Obligations, it shall promptly notify the Administrative Agent thereof (and the
Administrative Agent shall promptly notify the other Lenders). If, as a result
of such payment, such Lender receives a greater percentage of the Secured
Obligations owed to it under this Agreement than the percentage received by any
other Lender, such Lender shall purchase a participation (which it shall be
deemed to have purchased simultaneously upon the receipt of such payment) in the
Secured Obligations then held by such other Lenders so that all such recoveries
of principal and interest with respect to all Secured Obligations owed to each
Lender shall be pro rata on the basis of its respective amount of the Secured
Obligations owed to all Lenders, PROVIDED that if all or part of such
proportionately greater payment received by such purchasing Lender is thereafter
recovered by or on behalf of the Borrower from such Lender, such purchase shall
be rescinded and the purchase price paid for such participation shall be
returned to such Lender to the extent of such recovery, together with interest
thereon at the rate, if any, required to be paid on the amount recovered from
such purchasing Lender.
(b) Each Lender which receives such a secured claim shall, to
the extent practicable, exercise its rights in respect of such secured claim in
a manner consistent with the rights of the Lenders entitled under this SECTION
15.22 to share in the benefits of any recovery on such secured claim.
(c) Each Lender shall include in any arrangement or agreement
it enters into with any participant in such Lender's interests hereunder, an
undertaking by such participant substantially similar to the foregoing
SUBSECTIONS (A) and (B).
(d) The Borrowers expressly consent to the foregoing
arrangements and agree that any holder of a participation in any Secured
Obligation so purchased or otherwise acquired of which such Borrower has
received notice may exercise any and all rights of banker's lien, set-off or
counterclaim with respect to any and all monies owing by such Borrower to such
holder as fully as if such holder were a holder of such Secured Obligation in
the amount of the participation held by such holder.
SECTION 15.23 Net Payments.
(a) No Reduction for Taxes. All payments by the Borrowers
hereunder to or for the benefit of any Lender or the Administrative Agent shall
be made without setoff, counterclaim or other defense. Except as required by law
or as provided in SECTION 15.23(B), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments, or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any political subdivision or
taxing authority thereof or therein with respect to such payments (excluding any
tax imposed on or measured by the net income or profits of such Lender or the
Administrative Agent, as the case may be, pursuant to the laws of the
jurisdiction in which it is organized or in which its principal offices or the
office from which the Loans are administered may be located or to which payments
on the Loans are otherwise deemed connected for tax purposes) together with all
interest,
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penalties or similar liabilities with respect thereto (collectively, "Covered
Taxes"). Except as provided in SECTION 15.23(B), if the Borrowers shall be
required by law to deduct or withhold any Covered Taxes from any sum payable
hereunder to any Lender or the Administrative Agent, (A) the sum payable shall
be increased as may be necessary so that after making all required deductions or
withholdings of Covered Taxes (including deductions or withholdings of Covered
Taxes applicable to additional sums payable under this SECTION 15.23(A)) such
Lender or the Administrative Agent, as the case may be, receives an amount equal
to the sum it would have received had such deductions or withholdings not been
made, (B) the Borrowers shall make such deductions or withholdings, and (C) the
Borrowers shall pay the full amount so deducted or withheld to the relevant
taxing authority or other authority in accordance with Applicable Law. The
Borrowers shall furnish to the Administrative Agent within 45 days after the
date on which the payment of any Covered Taxes is due certified copies of tax
receipts evidencing such payment by the Borrowers. Except as provided in SECTION
15.23(B), the Borrowers agree to indemnify and hold harmless the Lenders and the
Administrative Agent and reimburse each of them, as the case may be, for the
amount of any Covered Taxes that are levied against or imposed on the Lenders or
the Administrative Agent and that are paid by the Lenders or the Administrative
Agent, as the case may be.
(b) Foreign Lenders. (i) Each Foreign Lender shall deliver to
the Administrative Agent and the Borrowers (A) two valid, duly completed copies
of IRS Form 1001 or 4224 or applicable successor form, as the case may be, and
any other required form, certifying in each case that such Foreign Lender is
entitled to receive payments under this Agreement or the Note(s) payable to it
without deduction or withholding of any United States federal income taxes and
(B) a valid, duly completed IRS Form W-8 or W-9 or applicable successor form, as
the case may be, to establish an exemption from United States backup withholding
tax. Each such Foreign Lender shall also deliver to the Administrative Agent and
the Borrowers two further copies of said Form 1001 or 4224 and W-8 or W-9, or
applicable successor forms, or other manner of required certification, as the
case may be, on or before the date that any such form expires or becomes
obsolete or otherwise is required to be resubmitted as a condition to obtaining
an exemption from a required withholding of United States federal income tax or
after the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrowers and the Administrative Agent, and
such extensions or renewals thereof as may reasonably be requested by the
Borrowers and the Administrative Agent.
(ii) If the forms provided by a Foreign Lender under SECTION
15.23(B)(I) at the time such Foreign Lender first becomes a party to this
Agreement indicate that such Foreign Lender is subject to a rate of United
States withholding tax in excess of zero, then withholding tax at such rate
shall be considered excluded from Covered Taxes unless and until such Foreign
Lender provides the appropriate forms certifying that a lesser rate of
withholding applies, whereupon withholding tax at such lesser rate only shall be
excluded from Covered Taxes for period governed by such forms.
(iii) For any period with respect to which a Foreign Lender
has failed to provide the Borrowers with the appropriate forms described in
Section 15.23(B)(I), such Foreign Lender shall not be entitled to
indemnification under SECTION 15.23(A) with respect to Covered Taxes imposed by
the United States by reason of such failure.
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(c) Affected Lenders. If the Borrowers are obligated to pay to
any Lender any amount under this SECTION 15.23, the Borrowers may, if no Default
or Event of Default then exists, replace such Lender with another lender
acceptable to the Administrative Agent, and such Lender hereby agrees to be so
replaced subject to the following:
(i) The obligations of the Borrowers hereunder to the
Lender to be replaced (including such increased or additional costs
incurred from the date of notice to the Borrowers of such increase or
additional costs through the date such Lender is replaced hereunder)
shall be paid in full to such Lender concurrently with such
replacement;
(ii) The replacement Lender shall be a bank or other
financial institution that is not subject to such increased costs which
caused the Borrowers' election to replace any Lender hereunder, and
each such replacement Lender shall execute and deliver to the
Administrative Agent such documentation satisfactory to the
Administrative Agent pursuant to which such replacement Lender is to
become a party hereto, conforming to the provisions of SECTION 13.1
hereof, with a Commitment equal to that of the Lender being replaced
and shall make Revolving Credit Loans in the aggregate principal amount
equal to the aggregate outstanding principal amount of the Revolving
Credit Loans of the Lender being replaced;
(iii) Upon such execution of such documents referred
to in CLAUSE (II) and repayment of the amounts referred to in CLAUSE
(I), the replacement Lender shall be a "Lender" with a Commitment as
specified hereinabove and the Lender being replaced shall cease to be a
"Lender" hereunder, except with respect to indemnification provisions
under this Agreement, which shall survive as to such replaced Lender;
(iv) The Administrative Agent shall reasonably
cooperate in effectuating the replacement of any Lender under this
SECTION 15.23, but at no time shall the Administrative Agent be
obligated to initiate any such replacement;
(v) Any Lender replaced under this SECTION 15.23
shall be replaced at the Borrowers' sole cost and expense and at no
cost or expense to the Administrative Agent or any of the Lenders; and
(vi) If the Borrowers propose to replace any Lender
pursuant to this SECTION 15.23 because the Lender seeks reimbursement
hereunder, then the Borrowers must also replace any other Lender who
seeks similar levels of reimbursement (as a percentage of such Lender's
Commitment) under such Sections.
SECTION 15.24 Effect on Effectiveness of this Agreement. From
and after the Effective Date, all references in this Agreement or in any other
Loan Document (whether delivered pursuant to this Agreement or pursuant to the
Existing Loan Agreement) to this Agreement or the "Loan Agreement," and the
words "herein," "hereof" and words of like import referring to the Existing Loan
Agreement, shall mean and be references to the Existing Loan Agreement as
amended and restated in its entirety by this Agreement and all references in
this Agreement, in any other Loan Documents (whether delivered pursuant to this
Agreement or
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pursuant to the Existing Loan Agreement) or in any Note to a "Revolving Credit
Note" and the words "hereof," "herein" and words of like import referring to any
such Note, shall mean and be references to the Second Amended and Restated
Promissory Notes in the form attached to this Agreement as EXHIBIT A-1,
appropriately completed and duly executed and delivered by the Borrowers.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their duly authorized officers in several
counterparts all as of the day and year first written above.
BORROWERS:
XXXXXXX TIRE GROUP, INC.
[CORPORATE SEAL]
Attest: By:
--------------------------------------
Xxxxxx X. Roof
President and Chief Executive Officer
------------------------------
J. Xxxxxxx Xxxxxxx
Secretary
WINSTON TIRE COMPANY
[CORPORATE SEAL]
Attest: By:
--------------------------------------
Xxxxxx X. Roof
President and Chief Executive Officer
------------------------------
J. Xxxxxxx Xxxxxxx
Secretary By:
--------------------------------------
Xxxxx X. Xxxxxx
Chief Financial Officer
CALIFORNIA TIRE COMPANY
[CORPORATE SEAL]
Attest: By:
--------------------------------------
Xxxxxx X. Roof
President and Chief Executive Officer
------------------------------
J. Xxxxxxx Xxxxxxx
Secretary By:
--------------------------------------
Xxxxx X. Xxxxxx
Chief Financial Officer
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THE SPEED MERCHANT, INC.
[CORPORATE SEAL]
Attest: By:
--------------------------------------
Xxxxxx X. Roof
President and Chief Executive Officer
------------------------------
[Assistant] Secretary
By:
--------------------------------------
Xxxxx X. Xxxxxx
Chief Financial Officer
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FLEET CAPITAL CORPORATION, as
Administrative Agent and as
a Lender
By:_______________________________________
Name:________________________________
Title:_______________________________
Address:
Fleet Capital Corporation
000 Xxxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. XxXxxxx
Facsimile No.: (000) 000-0000
BANK OF AMERICA, N.A., as Syndication
Agent and as a Lender
By:_______________________________________
Name:________________________________
Title:_______________________________
Address:
------------------------------
------------------------------
------------------------------
Attn:_________________________
Facsimile No.:________________
FIRST UNION NATIONAL BANK, as
Documentation Agent and as a
Lender
By:
---------------------------------------
Xxxx X. Xxxxxxx
Director
Address:
First Union National Bank
000 Xxxxx Xxxxxxx Xxxxxx, XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn:
Facsimile No.: (000) 000-0000
133
MELLON BANK, N.A., as a Lender
By:_______________________________________
Xxxxx Xxxxx
Vice President
Address:
------------------------------
------------------------------
------------------------------
Attn:_________________________
______________________________
Facsimile No.:________________
PNC BANK, NATIONAL ASSOCIATION, as a Lender
By:_______________________________________
Xxxx Xxxxxxxx
Vice President
Address:
------------------------------
------------------------------
------------------------------
Attn:_________________________
Facsimile No.:________________
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ANNEX A
COMMITMENTS
-----------------------------------------------------------------------------
LENDER COMMITMENT (IN $)
-----------------------------------------------------------------------------
Fleet Capital Corporation 65,000,000
-----------------------------------------------------------------------------
First Union National Bank 45,000,000
-----------------------------------------------------------------------------
Bank of America, N.A. 45,000,000
-----------------------------------------------------------------------------
Mellon Bank, N.A. 22,500,000
-----------------------------------------------------------------------------
PNC Bank, National Association 22,500,000
-----------------------------------------------------------------------------
TOTAL 200,000,000
-----------------------------------------------------------------------------
135
ANNEX B
PRICING MATRIX
--------------------------------------------------------------------------------
LEVEL INTEREST COVERAGE EURODOLLAR RATE BASE RATE UNUSED COMMITMENT
RATIO LOANS LOANS FEE
--------------------------------------------------------------------------------
Level I < 1.50:1 2.00% 0.50% 0.50%
-
--------------------------------------------------------------------------------
> 1.50:1 and
Level II < 2.00:1 1.75% 0.25% 0.375%
-
--------------------------------------------------------------------------------
> 2.00:1 and
Level III < 2.50:1 1.50% 0.00% 0.375%
-
--------------------------------------------------------------------------------
Level IV > 2.50:1 1.25% 0.00% 0.25%
--------------------------------------------------------------------------------
