EXECUTION COPY
Exhibit 10.1
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REVOLVING CREDIT AGREEMENT
Among
INTERSTATE BAKERIES CORPORATION,
a Debtor and Debtor-in-Possession under Chapter 11 of the Bankruptcy Code,
as Parent Borrower,
CERTAIN OF THE DIRECT AND INDIRECT SUBSIDIARIES
OF INTERSTATE BAKERIES CORPORATION,
Debtors and Debtors-in-Possession under Chapter 11 of the Bankruptcy Code,
as Subsidiary Borrowers,
and
THE LENDERS PARTY HERETO,
and
JPMORGAN CHASE BANK,
as Administrative Agent
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Dated as of September 23, 2004
REVOLVING CREDIT AGREEMENT
TABLE OF CONTENTS
Page No.
Section 1. DEFINITIONS.....................................................................................2
Section 1.1 Defined Terms............................................................................2
Section 1.2 Terms Generally.........................................................................24
Section 2. AMOUNT AND TERMS OF CREDIT.....................................................................24
Section 2.1 Commitment of the Lenders...............................................................24
Section 2.2 Availability of Commitment; Borrowing Base..............................................25
Section 2.3 Letters of Credit.......................................................................25
Section 2.4 Issuance................................................................................28
Section 2.5 Nature of Letter of Credit Obligations Absolute.........................................28
Section 2.6 Making of Loans.........................................................................28
Section 2.7 Repayment of Loans and Unreimbursed Draws; Evidence of Debt.............................29
Section 2.8 Interest on Loans.......................................................................30
Section 2.9 Default Interest........................................................................30
Section 2.10 Optional Termination or Reduction of Commitment.........................................30
Section 2.11 Alternate Rate of Interest..............................................................31
Section 2.12 Refinancing of Loans....................................................................31
Section 2.13 Mandatory Prepayment; Commitment Termination............................................32
Section 2.14 Optional Prepayment of Loans; Reimbursement of Lenders..................................33
Section 2.15 Reserve Requirements; Change in Circumstances...........................................34
Section 2.16 Change in Legality......................................................................36
Section 2.17 Pro Rata Treatment, etc.................................................................36
Section 2.18 Taxes...................................................................................37
Section 2.19 Certain Fees............................................................................39
Section 2.20 Commitment Fee..........................................................................39
Section 2.21 Letter of Credit Fees...................................................................39
Section 2.22 Nature of Fees..........................................................................40
Section 2.23 Priority and Liens......................................................................40
Section 2.24 Use of Cash Collateral..................................................................42
Section 2.25 Right of Set-Off........................................................................42
Section 2.26 Security Interest in Letter of Credit Account...........................................42
Section 2.27 Payment of Obligations..................................................................42
Section 2.28 No Discharge; Survival of Claims........................................................43
Section 2.29 Replacement of Certain Lenders..........................................................43
Section 3. REPRESENTATIONS AND WARRANTIES.................................................................44
Section 3.1 Organization and Authority..............................................................44
Section 3.2 Due Execution...........................................................................44
Section 3.3 Statements Made.........................................................................44
Section 3.4 Financial Statements....................................................................45
Section 3.5 Ownership...............................................................................45
Section 3.6 Liens...................................................................................45
Section 3.7 Compliance with Law.....................................................................45
Section 3.8 Insurance...............................................................................46
Section 3.9 The Orders..............................................................................46
Section 3.10 Use of Proceeds.........................................................................46
Section 3.11 Litigation..............................................................................46
Section 3.12 Intellectual Property...................................................................47
Section 3.13 Taxes...................................................................................47
Section 3.14 Investment Company Act; Other Regulations...............................................47
Section 3.15 ERISA Matters...........................................................................47
Section 4. CONDITIONS OF LENDING..........................................................................47
Section 4.1 Conditions Precedent to Initial Loan and Initial Letter of Credit.......................47
Section 4.2 Conditions Precedent to Each Loan and Each Letter of Credit.............................50
Section 5. AFFIRMATIVE COVENANTS..........................................................................51
Section 5.1 Financial Statements, Reports, etc......................................................51
Section 5.2 Existence...............................................................................54
Section 5.3 Insurance...............................................................................55
Section 5.4 Obligations and Taxes...................................................................55
Section 5.5 Notice of Event of Default, etc.........................................................55
Section 5.6 Access to Books and Records.............................................................55
Section 5.7 Maintenance of Concentration Account....................................................56
Section 5.8 Borrowing Base Certificate..............................................................56
Section 5.9 Compliance with Laws....................................................................57
Section 5.10 Environmental Laws......................................................................57
Section 5.11 Restructuring Advisors..................................................................57
Section 6. NEGATIVE COVENANTS.............................................................................57
Section 6.1 Liens...................................................................................58
Section 6.2 Merger, etc.............................................................................58
Section 6.3 Indebtedness............................................................................58
Section 6.4 Capital Expenditures....................................................................58
Section 6.5 EBITDA..................................................................................58
Section 6.6 Guarantees and Other Liabilities........................................................58
Section 6.7 Chapter 11 Claims.......................................................................59
Section 6.8 Dividends; Capital Stock................................................................59
Section 6.9 Transactions with Affiliates............................................................59
Section 6.10 Investments, Loans and Advances.........................................................59
Section 6.11 Disposition of Assets...................................................................59
Section 6.12 Nature of Business......................................................................60
Section 6.13 Transactions among Borrowers............................................................60
Section 6.14 Right of Subrogation among Borrowers....................................................60
Section 6.15 Derivative Agreements. Enter into any agreement with respect to any....................60
Section 6.16 Reorganization Plan.....................................................................60
Section 7. EVENTS OF DEFAULT..............................................................................60
Section 7.1 Events of Default.......................................................................60
Section 8. THE ADMINISTRATIVE AGENT.......................................................................64
Section 8.1 Administration by Administrative Agent..................................................64
Section 8.2 Advances and Payments...................................................................64
Section 8.3 Sharing of Setoffs......................................................................64
Section 8.4 Agreement of Required Lenders...........................................................65
Section 8.5 Liability of Administrative Agent.......................................................65
Section 8.6 Reimbursement and Indemnification.......................................................66
Section 8.7 Rights of Administrative Agent..........................................................66
Section 8.8 Independent Lenders.....................................................................66
Section 8.9 Notice of Transfer......................................................................66
Section 8.10 Successor Administrative Agent..........................................................67
Section 9. MISCELLANEOUS..................................................................................67
Section 9.1 Notices.................................................................................67
Section 9.2 Survival of Agreement, Representations and Warranties, etc..............................68
Section 9.3 Successors and Assigns..................................................................68
Section 9.4 Confidentiality.........................................................................71
Section 9.5 Expenses................................................................................71
Section 9.6 Indemnity...............................................................................71
Section 9.7 Choice of Law...........................................................................72
Section 9.8 No Waiver...............................................................................72
Section 9.9 Extension of Maturity...................................................................72
Section 9.10 Amendments, etc.........................................................................72
Section 9.11 Severability............................................................................73
Section 9.12 Headings................................................................................73
Section 9.13 Execution in Counterparts...............................................................74
Section 9.14 Prior Agreements........................................................................74
Section 9.15 Further Assurances......................................................................74
Section 9.16 Waiver of Jury Trial....................................................................74
Section 9.17 Subordination of Intercompany Indebtedness..............................................74
Section 9.18 Certain Post Closing Matters............................................................75
Section 9.19 USA Patriot Act.........................................................................77
Annex A - Commitment Amounts
Exhibit A - Form of Interim Order
Exhibit B - Form of Security and Pledge Agreement
Exhibit C-1 - Form of Weekly Borrowing Base Certificate
Exhibit C-2 - Form of Monthly Borrowing Base Certificate
Exhibit D - Form of Opinion of Counsel
Exhibit E - Form of Assignment and Acceptance
Schedule 1.1 - Eligible Real Property
Schedule 3.5 - Subsidiaries
Schedule 3.6 - Liens
Schedule 3.12 - Intellectual Property
Schedule 6.9 - Transactions with Affiliates
Schedule 6.10 - Other Investments
Schedule 6.13 - Borrower Transaction Restrictions
REVOLVING CREDIT AGREEMENT
Dated as of September 23, 2004
REVOLVING CREDIT AGREEMENT, dated as of September 23, 2004, among
INTERSTATE BAKERIES CORPORATION, a Delaware corporation ("Parent Borrower"),
a debtor and debtor-in-possession in a case pending under Chapter 11 of the
Bankruptcy Code, and each of the direct and indirect subsidiaries of the
Parent Borrower party to this Agreement (each individually a "Subsidiary
Borrower" and collectively the "Subsidiary Borrowers"; and together with the
Parent Borrower, the "Borrowers"), each of which is a debtor and
debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy
Code (the cases of the Borrowers, each a "Case" and collectively, the
"Cases"), JPMORGAN CHASE BANK, a New York banking corporation ("JPMCB"), and
each of the other commercial banks, finance companies, insurance companies or
other financial institutions or funds from time to time party hereto
(together with JPMCB, the "Lenders"), X.X. XXXXXX SECURITIES INC., as lead
arranger and book runner, JPMORGAN CHASE BANK, as administrative agent (in
such capacity, the "Administrative Agent") for the Lenders, and JPMORGAN
CHASE BANK, as collateral agent (in such capacity, the "Collateral Agent")
for the Lenders.
INTRODUCTORY STATEMENT
WHEREAS, on September 22, 2004, the Borrowers filed voluntary
petitions with the Bankruptcy Court initiating the Cases and have continued
in the possession of their assets and in the management of their businesses
pursuant to Sections 1107 and 1108 of the Bankruptcy Code; and
WHEREAS, the Borrowers have applied to the Lenders for a
revolving credit and letter of credit facility in an aggregate principal
amount not to exceed $200,000,000 (subject to the terms and conditions of
this Agreement); and
WHEREAS, the proceeds of the Loans will be used for (i) working
capital, letters of credit and capital expenditures; (ii) other general
corporate purposes of the Borrowers; (iii) payment of any related transaction
costs, fees and expenses; and (iv) the costs of administration of the Cases,
all as provided for herein; and
WHEREAS, to provide for the repayment of the Loans, the
reimbursement of any draft drawn under a Letter of Credit and the payment of
the other obligations of the Borrowers hereunder and under the other Loan
Documents (including, without limitation, the Obligations of the Borrowers
under Section 6.3(v)), the Borrowers will provide to the Administrative Agent
and the Lenders the following (each as more fully described herein):
(a) an allowed Superpriority Claim;
(b) a perfected first priority Lien, pursuant to Section
364(c)(2) of the Bankruptcy Code, upon all unencumbered property of the
Borrowers and on all cash and cash equivalents in the Letter of Credit
Account, provided that following the Termination Date, amounts in the Letter
of Credit Account shall not be subject to the Carve-Out hereinafter referred
to;
(c) a perfected Lien, pursuant to Section 364(c)(3) of the
Bankruptcy Code, upon all property of the Borrowers that is subject to valid
and perfected Permitted Liens in existence on the Filing Date or that is
subject to valid Permitted Liens in existence on the Filing Date that are
perfected subsequent to the Filing Date as permitted by Section 546(b) of the
Bankruptcy Code; and
(d) a perfected first priority priming Lien, pursuant to Section
364(d)(1) of the Bankruptcy Code, upon all property of the Borrowers
(including, without limitation, inventory, accounts receivable, rights under
license agreements, and property, plant and equipment), that is subject to
the existing Liens (the "Primed Liens") which secure (i) the obligations of
the Borrowers to the lenders party to the Pre-Petition Credit Agreement, and
(ii) other obligations or indebtedness of the Borrowers, which first priority
priming Lien in favor of the Administrative Agent and the Lenders shall be
senior in all respects to all of the Primed Liens; and
WHEREAS, all of the claims granted hereunder in the Cases to the
Administrative Agent and the Lenders shall be subject to the Carve-Out to the
extent provided in Section 2.23.
Accordingly, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS
Section 1.1 Defined Terms.
As used in this Agreement, the following terms shall have the
meanings specified below:
"ABR Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Alternate Base Rate in accordance with the
provisions of Section 2.
"Account" shall mean any right to payment for goods sold in the
ordinary course of business, regardless of how such right is evidenced and
whether or not it has been earned by performance.
"Account Debtor" means, with respect to any Account, the obligor
with respect to such Account.
"Act" shall have the meaning given such term in Section 9.19.
"Additional Credit" shall have the meaning given such term in
Section 4.2(d).
"Adjusted Eligible Accounts Receivable" shall mean Eligible
Accounts Receivable, minus the Dilution Reserve.
"Adjusted LIBOR Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the quotient of (i)
the LIBOR Rate in effect for such Interest Period divided by (ii) a
percentage (expressed as a decimal) equal to 100% minus Statutory Reserves.
For purposes hereof, the term "LIBOR Rate" shall mean the rate (rounded
upwards, if necessary, to the next 1/16 of 1%) at which dollar deposits
approximately equal in principal amount to such Eurodollar Borrowing and for
a maturity comparable to such Interest Period are offered to the principal
London office of the Administrative Agent in immediately available funds in
the London interbank market at approximately 11:00 a.m., London time, two (2)
Business Days prior to the commencement of such Interest Period.
"Administrative Agent" shall have the meaning set forth in the
Introduction.
"Administrative Questionnaire" means an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"Affected Lender" shall have the meaning given such term in
Section 2.29.
"Affiliate" shall mean, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. For purposes of this definition, a Person
(a "Controlled Person") shall be deemed to be "controlled by" another Person
(a "Controlling Person") if the Controlling Person possesses, directly or
indirectly, power to direct or cause the direction of the management and
policies of the Controlled Person whether by contract or otherwise.
"Agreement" shall mean this Revolving Credit Agreement, as the
same may from time to time be amended, restated, modified or supplemented.
"Alternate Base Rate" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Base CD Rate in effect
on such day plus 1% and (c) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. For purposes hereof, "Prime Rate" shall mean the
rate of interest per annum publicly announced from time to time by the
Administrative Agent as its prime rate in effect at its principal office in
New York City; each change in the Prime Rate shall be effective on the date
such change is publicly announced. "Base CD Rate" shall mean the sum of (i)
the quotient of (a) the Three-Month Secondary CD Rate divided by (b) a
percentage expressed as a decimal equal to 100% minus Statutory Reserves and
(ii) the Assessment Rate. "Three-Month Secondary CD Rate" shall mean, for any
day, the secondary market rate for three-month certificates of deposit
reported as being in effect on such day (or, if such day shall not be a
Business Day, the next preceding Business Day) by the Board through the
public information telephone line of the Federal Reserve Bank of New York
(which rate will, under the current practices of the Board, be published in
Federal Reserve Statistical Release H.15(519) during the week following such
day), or, if such rate shall not be so reported on such day or such next
preceding Business Day, the average of the secondary market quotations for
three-month certificates of deposit of major money center banks in New York
City received at approximately 10:00 a.m., New York City time, on such day
(or, if such day shall not be a Business Day, on the next preceding Business
Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it.
"Federal Funds Effective Rate" shall mean, for any day, 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 on the
next succeeding 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 the day of such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it. If for any reason the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error)
that it is unable to ascertain the Base CD Rate or the Federal Funds
Effective Rate or both for any reason, including the inability or failure of
the Administrative Agent to obtain sufficient quotations in accordance with
the terms hereof, the Alternate Base Rate shall be determined without regard
to clause (ii) of the first sentence of this definition, as appropriate,
until the circumstances giving rise to such inability no longer exist. Any
change in the Alternate Base Rate due to a change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate,
respectively.
"Amounts" shall have the meaning given such term in Section
2.18(a).
"Approved Fund" means, with respect to any Lender that is a fund
that invests in bank loans and similar commercial extensions of credit, any
other fund that invests in bank loans and similar commercial extensions of
credit and is managed by the same investment advisor as such Lender or by a
Lender Affiliate of such investment advisor.
"Assessment Rate" shall mean for any date the annual rate
(rounded upwards, if necessary, to the next 1/100 of 1%) most recently
estimated by the Administrative Agent as the then current net annual
assessment rate that will be employed in determining amounts payable by the
Administrative Agent to the Federal Deposit Insurance Corporation (or any
successor) for insurance by such Corporation (or any successor) of time
deposits made in dollars at the Administrative Agent's domestic offices.
"Asset Sale" shall mean a sale, lease or sub-lease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than a
Borrower), in one transaction or series of transactions, of all or any part
of the Borrowers' or any of their Subsidiaries' businesses, assets or
properties of any kind, whether real, personal, or mixed and whether tangible
or intangible, whether now owned or hereafter acquired, including, without
limitation, the capital stock of any of the Borrowers (other than the Parent
Borrower) or their Subsidiaries in each case other than (i) Inventory,
including scrap or obsolete Inventory, sold in the ordinary course of
business, and (ii) sales of assets for aggregate consideration of less than
$100,000 with respect to any transaction or series of related transactions.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an Eligible Assignee, and accepted by
the Administrative Agent, substantially in the form of Exhibit E.
"Available Commitment" shall have the meaning given to such term
in Section 2.2(b).
"Bankruptcy Code" shall mean The Bankruptcy Reform Act of 1978,
as heretofore and hereafter amended, and codified as 11 U.S.C. Section 101 et
seq.
"Bankruptcy Court" shall mean the United States Bankruptcy Court
for the Western District of Missouri or any other court having jurisdiction
over the Cases from time to time.
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"Borrowers" shall have the meaning set forth in the Introduction.
"Borrowing" shall mean the incurrence of Loans of a single Type
made from all the Lenders on a single date and having, in the case of
Eurodollar Loans, a single Interest Period (with any ABR Loan made pursuant
to Section 2.16 being considered a part of the related Borrowing of
Eurodollar Loans).
"Borrowing Base" shall mean, at the time of any determination, an
amount equal to the sum, without duplication, of (a) 85% of Adjusted Eligible
Accounts Receivable plus (b) 40% of Eligible Inventory, plus (c) the Real
Property Component, minus (d) the amount of the Environmental Reserve at such
time, minus (e) the Carve-Out. The Borrowing Base at any time shall be
determined by reference to the most recent Borrowing Base Certificate
delivered to the Administrative Agent pursuant to Section 5.8 of the
Agreement. Subject to the limitations and requirements set forth in Section
9.10(a) of the Agreement, standards of eligibility and reserves and advance
rates of the Borrowing Base may be revised and adjusted from time to time by
the Administrative Agent in its sole discretion, with any changes in such
standards to be effective three (3) Business Days after delivery of notice
thereof to the Borrowers.
"Borrowing Base Certificate" shall mean a certificate
substantially in the form of Exhibit C-1 hereto (with respect to the
certificate to be delivered by the Borrowers weekly) and Exhibit C-2 hereto
(with respect to the certificate to be delivered by the Borrowers monthly)
(in each case with such changes therein as may be required by the
Administrative Agent from time to time to reflect the components of and
reserves against the Borrowing Base as provided for hereunder from time to
time), executed and certified as accurate and complete by a Financial Officer
of each of the Borrowers, which shall include appropriate exhibits, schedules
and supporting documentation, and additional reports as (i) outlined in
Exhibits C-1 and C-2, (ii) as requested by the Administrative Agent, and
(iii) as provided in Section 5.8.
"Budget" shall have the meaning set forth in Section 5.1(f).
"Budget Acceptance Date" shall have the meaning set forth in
Section 2.2(c).
"Business Day" shall mean any day other than a Saturday, Sunday
or other day on which banks in the State of New York are required or
permitted to close (and, for a Letter of Credit, other than a day on which
the Fronting Bank issuing such Letter of Credit is closed); provided,
however, that when used in connection with a Eurodollar Loan, the term
"Business Day" shall also exclude any day on which banks are not open for
dealings in dollar deposits on the London interbank market.
"Capital Expenditures" shall mean, for any period, the aggregate
of all expenditures (whether paid in cash and not theretofore accrued
subsequent to the date of this Agreement or accrued as liabilities during
such period and including that portion of Capitalized Leases which is
capitalized on the consolidated balance sheet of the Borrowers and their
Subsidiaries) by the Borrowers and their Subsidiaries during such period
that, in conformity with GAAP, are required to be included in or reflected by
the property, plant, equipment or intangibles or similar fixed asset accounts
reflected in the consolidated balance sheet of the Borrowers and their
Subsidiaries (including equipment which is purchased simultaneously with the
trade-in of existing equipment owned by any of the Borrowers or their
Subsidiaries to the extent of the gross amount of such purchase price less
the book value of the equipment being traded in at such time), but excluding
expenditures made in connection with the replacement or restoration of
assets, to the extent reimbursed or financed from insurance proceeds paid on
account of the loss of or the damage to the assets being replaced or
restored, or from awards of compensation arising from the taking by
condemnation or eminent domain of such assets being replaced.
"Capitalized Lease" shall mean, as applied to any Person, any
lease of property by such Person as lessee which would be capitalized on a
balance sheet of such Person prepared in accordance with GAAP.
"Carve-Out" shall have the meaning set forth in Section 2.23(a).
"Cases" has the meaning set forth in the Introduction.
"Change of Control" shall mean with respect to the Parent
Borrower and any Subsidiary Borrower: (i) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of
the Securities and Exchange Commission thereunder as in effect on the date
hereof), of shares representing more than 25% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of such
Borrower; or (ii) the occupation of a majority of the seats (other than
vacant seats) on the board of directors of such Borrower, after the Filing
Date, by Persons who were neither (a) nominated by the board of directors of
such Borrower nor (b) appointed by the directors so nominated.
"Closing Date" shall mean the date on which this Agreement has
been executed and the conditions precedent to the making of the initial Loans
set forth in Section 4.1 have been satisfied or waived, which date shall
occur as promptly as is practicable after the date of this Agreement, but in
no event later than ten (10) days following the entry of the Interim Order.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Collateral" shall mean the Collateral described in the Security
and Pledge Agreement.
"Collateral Agent" shall have the meaning set forth in the
Introduction.
"Commitment" shall mean the commitment of each Lender hereunder
to make Loans and to issue and/or participate in Letters of Credit in the
amount set forth opposite its name on Annex A hereto or as may subsequently
be set forth in the Register from time to time, as the same may be reduced
from time to time pursuant to the terms of this Agreement.
"Commitment Fee" shall have the meaning set forth in Section 2.20.
"Commitment Letter" shall mean that certain Commitment Letter dated
September 20, 2004 among the Administrative Agent, X.X. Xxxxxx Securities, Inc.
and the Borrowers.
"Commitment Fee Percentage" shall mean 0.50% per annum.
"Commitment Percentage" shall mean at any time, with respect to
each Lender, the percentage obtained by dividing its Commitment at such time by
the Total Commitment, as applicable, at such time.
"Consolidated EBITDA" shall mean, for any period, all as determined
in accordance with GAAP and subject to such modifications as may be
satisfactory to the Administrative Agent, the consolidated net income (or net
loss) of the Borrowers for such period, plus (a) the sum of (i) depreciation
expense, (ii) amortization expense, (iii) other non-cash charges, (iv) net
total Federal, state and local income tax expense, (v) gross interest expense
for such period less gross interest income for such period, (vi) extraordinary
losses, (vii) any restructuring charge, and (viii) "Chapter 11 expenses" (or
"administrative costs reflecting Chapter 11 expenses", inclusive of
professional fees) as shown on the Borrowers' consolidated statement of income
for such period, less (b) extraordinary gains, plus or minus (c) the amount of
cash received or expended in such period in respect of any amount which, under
clause (a)(vii) above, was taken into account in determining Consolidated
EBITDA for such or any prior period.
"Consummation Date" shall mean the date of the substantial
consummation (as defined in Section 1101 of the Bankruptcy Code and which for
purposes of this Agreement shall be no later than the effective date) of a
Reorganization Plan of the Borrowers that is confirmed pursuant to an order of
the Bankruptcy Court in the Cases.
"Default" shall have the meaning given such term in Section 2.23(a).
"Dilution Factors" shall mean, without duplication, with respect to
any period, the aggregate amount of all deductions, credit memos, returns,
adjustments, allowances, bad debt write-offs and other non-cash credits which
are recorded to reduce accounts receivable in a manner consistent with current
and historical accounting practices of the Borrowers.
"Dilution Ratio" shall mean, at any date, the amount (expressed as
a percentage) equal to (a) the aggregate amount of the applicable Dilution
Factors for the twelve (12) most recently ended fiscal months divided by (b)
total gross sales for the twelve (12) most recently ended fiscal months.
"Dilution Reserve" shall mean, at any date, the applicable Dilution
Ratio multiplied by the Eligible Accounts Receivable on such date, but only to
the extent the Dilution Ratio exceeds 5%.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"Domestic Subsidiary" shall mean any Subsidiary incorporated,
organized or formed under the laws of any jurisdiction of the United States.
"Eligible Assignee" shall mean (i) a commercial bank having total
assets in excess of $1,000,000,000; (ii) a finance company, insurance company
or other financial institution or fund, in each case acceptable to the
Administrative Agent, which in the ordinary course of business extends credit
of the type contemplated herein and has total assets in excess of $200,000,000
and whose becoming an assignee would not constitute a prohibited transaction
under Section 4975 of ERISA; and (iii) any other financial institution
satisfactory to the Borrowers and the Administrative Agent.
"Eligible Accounts Receivable" means, at the time of any
determination thereof, each Account that satisfies the following criteria at
the time of creation and continues to meet the same at the time of such
determination: such Account (i) has been invoiced to, and represents the bona
fide amounts due to the Borrowers from, the purchaser of goods or services, in
each case originated in the ordinary course of business of the Borrowers and
(ii) in each case is subject to the Borrowers' corporate accounts receivable
credit and collection policies, procedures and practices and (iii) is not
ineligible for inclusion in the calculation of the Borrowing Base pursuant to
any of clauses (a) through (s) below or otherwise deemed by the Administrative
Agent in its sole discretion to be ineligible for inclusion in the calculation
of the Borrowing Base as described below. Without limiting the foregoing, to
qualify as Eligible Accounts Receivable, an Account shall indicate no person
other than a Borrower as payee or remittance party. In determining the amount
to be so included, the face amount of an Account shall be reduced by, without
duplication, to the extent not reflected in such face amount, (i) the amount of
all accrued and actual discounts, claims, credits or credits pending,
promotional program allowances, price adjustments, finance charges or other
allowances (including any amount that the Borrowers, as applicable, may be
obligated to rebate to a customer pursuant to the terms of any agreement or
understanding (written or oral)), (ii) the aggregate amount of all limits and
deductions provided for in this definition and elsewhere in this Agreement and
(iii) the aggregate amount of all cash received in respect of such Account but
not yet applied by the Borrowers to reduce the amount of such Account. Unless
otherwise approved from time to time in writing by the Administrative Agent
(subject to the limitations and requirements set forth in Section 9.10(a)), no
Account shall be an Eligible Account Receivable if, without duplication:
(a) the relevant Borrower does not have sole lawful and absolute
title to such Account; or
(b) the Account (i) is unpaid more than fifty-six (56) days from
the original date of invoice or (ii) has been written off the books of the
Borrowers or has been otherwise designated on such books as uncollectible; or
(c) more than 50% in face amount of all Accounts of the same
Account Debtor are ineligible pursuant to clause (b) above; or
(d) the Account Debtor is insolvent or the subject of any
bankruptcy case or insolvency proceeding of any kind or is of uncertain credit
quality, as determined by the Administrative Agent in its exclusive discretion;
or
(e) the Account is not payable in Dollars or the Account Debtor is
either not organized under the laws of the United States of America, any State
thereof, or the District of Columbia or is located outside or has its principal
place of business or substantially all of its assets outside the United States,
except to the extent the Account is supported by an irrevocable letter of
credit satisfactory to the Administrative Agent (as to form, substance and
issuer) and assigned to and directly drawable by the Administrative Agent; or
(f) the Account Debtor is the United States of America or any
department, agency or instrumentality thereof, unless the relevant Borrower
duly assigns its rights to payment of such Account to the Administrative Agent
pursuant to the Assignment of Claims Act of 1940, as amended, which assignment
and related documents and filings shall be in form, and substance satisfactory
to the Administrative Agent; or
(g)......the Account is supported by a security deposit (to
the extent received from the applicable Account Debtor), progress payment,
retainage or other similar advance made by or for the benefit of the
applicable Account Debtor, in each case to the extent thereof; or
(h)......(i) it is not subject to a valid and perfected
first priority Lien in favor of the Administrative Agent for the benefit of
the Secured Parties, subject to no other Liens other than Liens (if any)
permitted by the Loan Documents or (ii) it does not otherwise conform in all
material respects to the representations and warranties contained in the Loan
Documents relating to Accounts; or
(i) such Account was invoiced (i) in advance of goods or services
provided, or (ii) twice, or (iii) the associated income has not been earned; or
(j) such Account is a non-trade Account or relates to payment of
interest or is classified as a note receivable by the Borrowers in accordance
with the Borrowers' current and historical practices; or
(k) the sale to the Account Debtor is on a xxxx-and-hold,
guaranteed sale, sale-and-return, ship-and-return, sale on approval, extended
terms or consignment or other similar basis or made pursuant to any other
written agreement providing for repurchase or return of any merchandise which
has been claimed to be defective or otherwise unsatisfactory; or
(l) the goods giving rise to such Account have not been shipped and
title has not been transferred to the Account Debtor, or the Account represents
a progress-billing or otherwise does not represent a completed sale; for
purposes hereof "progress-billing" means any invoice for goods sold or leased
or services rendered under a contract or agreement pursuant to which the
Account Debtor's obligation to pay such invoice is conditioned upon a
Borrower's completion of any further performance under the contract or
agreement; or
(m) the Account arises out of a sale made by a Borrower to an
employee, officer, agent, director, stockholder, Subsidiary or Affiliate of a
Borrower, or the Account Debtor is an Affiliate of a Borrower; or
(n) such Account was not paid in full, and the Borrower created a
new receivable for the unpaid portion of the Account, without the agreement of
the customer, and other Accounts constituting chargebacks, debit memos and
other adjustments for unauthorized deductions; or
(o) the Account is created on cash on delivery terms; or
(p) the Account Debtor (i) is a creditor of a Borrower, (ii) has,
may assert, has asserted or is reasonably expected to assert a right of set-off
against a Borrower or (iii) has disputed or is reasonably expected to dispute
its liability (whether by chargeback or otherwise) or made, may make or is
reasonably expected to make any claim with respect to the Account or any other
Account of a Borrower which has not been resolved, in each case, without
duplication, to the extent of the amount owed by such Borrower to the Account
Debtor, the amount of such actual or asserted right of set-off, or the amount
of such dispute or claim, as the case may be; or
(q) the Account does not comply in all material respects with the
requirements of all applicable laws and regulations, whether Federal, state or
local, including without limitation the Federal Consumer Credit Protection Act,
the Federal Truth in Lending Act and Regulation Z of the Board; or
(r) to all or any part of such Account, a check, promissory note,
draft, trade acceptance or other Instrument for the payment of money has been
received, presented for payment and returned uncollected for any reason; or
(s) the Account is for goods that have been sold under a purchase
order or pursuant to the terms of a contract or other agreement or
understanding (written or oral) that indicates that any Person other than the
Borrowers has or has had or has purported to have or have had an ownership
interest in such goods.
Notwithstanding the foregoing, all Accounts of any single Account
Debtor and its Affiliates which, in the aggregate exceed (i) 30% in respect of
Account Debtors whose securities are rated Investment Grade or (ii) 10% in
respect of all other Account Debtors, of the total amount of all Eligible
Accounts Receivable at the time of any determination shall be deemed not to be
Eligible Accounts Receivable to the extent of such excess. In determining the
aggregate amount of Accounts from the same Account Debtor that are unpaid more
than fifty-six (56) days from the date of invoice pursuant to clause (b) above,
there shall be excluded the amount of any net credit balances relating to
Accounts with invoice dates more than fifty-six (56) days prior to the date of
determination. Furthermore, no Account shall be an Eligible Account Receivable
if it is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates that any Person other than a Borrower has or has had or has
purported to have or have had an ownership interest in such goods.
"Eligible Inventory" shall mean, on any date, the Inventory Value
of the Borrowers on such date deemed by the Administrative Agent in its sole
discretion to be eligible for inclusion in the calculation of the Borrowing
Base. Without limiting the foregoing, to qualify as "Eligible Inventory", no
Person other than the Borrowers shall have any direct or indirect ownership
interest or title to such Inventory. Unless otherwise from time to time
approved in writing by the Administrative Agent (subject to the limitations and
requirements set forth in Section 9.10(a)), no Inventory shall be deemed
Eligible Inventory if (and without duplication):
(a) it is not owned solely by the Borrowers or the Borrowers do not
have sole and good, valid and unencumbered title thereto; or
(b) it is not located in the United States; or
(c) it is not either (i) located on property owned by the
Borrowers, (ii) located in a third party warehouse or in another location not
owned by the Borrowers, and, at the sole discretion of the Borrowers, either
(A) covered by Landlord Lien Waiver or bailee letter, as applicable, in each
case in form and substance reasonably acceptable to the Administrative Agent,
or (B) a Rent Reserve has been taken with respect to such Inventory or (iii)
located at a closed facility owned or leased by the Borrowers; or
(d) it is not subject to a valid and perfected first priority Lien
in favor of the Administrative Agent, except, with respect to Inventory stored
at sites described in clause (c) above, for Liens for unpaid rent or normal and
customary warehousing charges, in each case, not yet paid, to the extent of
such unpaid rent or charges; or
(e) it is goods returned or rejected due to quality issues by the
Borrowers' customers or goods in transit to third parties (other than to
warehouse sites described in clause (c) above); or
(f) it is seconds or thirds or stale or is obsolete or slow moving
or unmerchantable, or overstock or excess or does not otherwise conform to the
representations and warranties contained in the Loan Documents; or
(g) it is comprised of operating supplies, packaging, film,
pallets, and/or other shipping materials or supplies, labels, repair or
maintenance parts, fuel, tires, paint, cartons used in production or other
containers, and any other such material not considered used for sale by the
Administrative Agent from time to time, in the Administrative Agent's sole
discretion; or
(h) the Borrowers classify such item as a sample item on their
perpetual inventory records, or the Borrowers use such item for marketing or
display; or
(i) it is a discontinued product or component thereof; or
(j) any portion of the Inventory Value thereof is attributable to
intercompany profit among the Borrowers or their Affiliates; or
(k) any Inventory that is damaged or marked for return to vendor;
or
(l) any Inventory that is Work-In-Process or Finished Goods; or
(m) it is consigned or at a customer location but still accounted
for in the Borrowers' perpetual inventory balance; or
(n) it is classified as "bakery outlet" inventory or "dry products".
"Eligible Real Property' means the real property listed on Schedule
1.1 (or otherwise reasonably acceptable to the Administrative Agent and owned
by any of the Borrowers: (i) that is acceptable in the sole discretion of the
Administrative Agent for inclusion in the Real Property Component, (ii) in
respect of which an appraisal report has been delivered to the Administrative
Agent in form, scope and substance reasonably satisfactory to the
Administrative Agent; (iii) in respect of which the Administrative Agent is
satisfied that all actions necessary or desirable in order to create valid
first priority and subsisting Liens on such real property have been taken,
including, without limitation, any action requested by the Administrative Agent
under Section 2.23(b), (iv) in respect of which an environmental assessment
report has been completed and delivered to the Administrative Agent in form and
substance satisfactory to the Administrative Agent and which does not indicate
any non-compliance with or liability under, or remediation action with respect
to, any Environmental Law, and (v) if required by the Administrative Agent,
which is adequately protected by fully-paid valid title insurance with
endorsements and in amounts acceptable to the Administrative Agent, insuring
that the Administrative Agent for the benefit of the Secured Parties, shall
have valid first and subsisting Liens on such real property, evidence of which
shall have been provided in form and substance satisfactory to the
Administrative Agent.
"Environmental Laws" shall mean all laws, statutes, ordinances,
orders, rules, regulations, plans, policies or decrees and the like relating to
(i) environmental matters, including, without limitation, those relating to
fines, injunctions, penalties, damages, contribution, cost recovery
compensation, losses or injuries resulting from the release or threatened
release of "Hazardous Waste" or "Hazardous Substances" (as such terms are
defined in any applicable Environmental Law), (ii) the generation, use,
storage, transportation or disposal of Hazardous Waste or Hazardous Substance,
or (iii) occupational safety and health, public health and safety, industrial
hygiene or protection of wetlands, in any manner applicable to the Borrowers or
any of their respective properties, including, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act (42
U.S.C. ss. 9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C.
ss. 1801 et seq.,), the Resource Conservation and Recovery Act (42 U.S.C. ss.
6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. ss. 1251 et
seq.), the Clean Air Act (42 U.S.C. ss. 7401 et seq.), the Toxic Substances
Control Act (15 U.S.C. ss. 2601 et seq.), the Federal Insecticide, Fungicide
and Rodenticide Act (7 U.S.C. ss.136 et seq.), the Occupational Safety and
Health Act (29 U.S.C. ss. 651 et seq.), and the Emergency Planning and
Community Right-to-Know Act (42 U.S.C. ss. 11001 et seq.), each as amended or
supplemented, and any analogous future or present local, state and federal
statutes and regulations promulgated pursuant thereto, each as in effect as of
the date of determination.
"Environmental Lien" shall mean a Lien in favor of any Governmental
Authority for (i) any liability under federal or state Environmental Laws, or
(ii) damages arising from or costs incurred by such Governmental Authority in
response to a release or threatened release of a hazardous or toxic waste,
substance or constituent, or other substance into the environment.
"Environmental Reserve" means a reserve determined by the
Administrative Agent in its sole discretion for costs associated with (a) the
generation, use, handling, transportation, storage, treatment or disposal of
any Hazardous Materials, (b) exposure to any Hazardous Materials or (c) any
Release.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) which is a member of a group of which any of the Borrowers is a
member and which is under common control within the meaning of Section 414(b)
or (c) of the Code and the regulations promulgated and rulings issued
thereunder.
"Eurocurrency Liabilities" shall have the meaning assigned thereto
in Regulation D issued by the Board, as in effect from time to time.
"Eurodollar Borrowing" shall mean a Borrowing comprised of
Eurodollar Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of Section 2.
"Event of Default" shall have the meaning given such term in
Section 7.
"Facilities" shall mean any and all real property (including,
without limitation, all buildings, fixtures or other improvements located
thereon) now, hereafter or heretofore owned, leased, operated or used by the
Borrowers (but only as to portions of buildings actually leased or used) or any
of their respective predecessors or any of their respective Affiliates that are
directly or indirectly controlled by the Borrowers.
"Fees" shall collectively mean the Commitment Fees, Letter of
Credit Fees and other fees referred to in Sections 2.19, 2.20 and 2.21.
"Filing Date" shall mean September 22, 2004.
"Final Order" shall have the meaning given such term in Section
4.2(d).
"Financial Officer" shall mean the Chief Financial Officer,
Controller or Treasurer of the Parent Borrower or a Subsidiary Borrower, as the
case may be.
"Finished Goods" shall mean completed goods which require no
additional processing or manufacturing to be sold to third party customers by
the Borrowers in the ordinary course of business.
"Forecast" shall have the meaning given such term in Section 5.1(e).
"Fronting Bank" shall mean JPMCB or such other commercial bank as
may agree with JPMCB to act in such capacity and shall be reasonably
satisfactory to the Borrowers and the Administrative Agent.
"GAAP" shall mean accounting principles generally accepted in the
United States and applied in accordance with Section 1.2.
"Governmental Authority" shall mean any Federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality or any court, in each case whether of the United States or
foreign.
"Hazardous Substances" shall have the meaning given such term in
the defined term "Environmental Laws".
"Hazardous Waste" shall have the meaning given such term in the
defined term "Environmental Laws".
"Indebtedness" shall mean, at any time and with respect to any
Person: (i) all indebtedness of such Person for borrowed money; (ii) all
indebtedness of such Person for the deferred purchase price of property or
services (other than property, including inventory, and services purchased, and
expense accruals and deferred compensation items arising, in the ordinary
course of business); (iii) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments (other than performance, surety
and appeal bonds arising in the ordinary course of business); (iv) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property); (v) all obligations of such Person under leases which have been or
should be, in accordance with GAAP, recorded as capital leases, to the extent
required to be so recorded; (vi) all reimbursement, payment or similar
obligations of such Person, contingent or otherwise, under acceptance, letter
of credit or similar facilities and all obligations of such Person in respect
of: (x) currency swap agreements, currency future or option contracts and other
similar agreements designed to hedge against fluctuations in foreign currency
exchange rates, (y) interest rate swap, cap or collar agreements and interest
rate future or option contracts and other similar agreements designed to hedge
against fluctuations in interest rates, and (z) swap agreements, future or
option contracts and other similar agreements designed to hedge against
fluctuations in commodities prices; (vii) all indebtedness referred to in
clauses (i) through (vi) above guaranteed directly or indirectly by such
Person, or in effect guaranteed directly or indirectly by such Person through
an agreement (a) to pay or purchase such indebtedness or to advance or supply
funds for the payment or purchase of such indebtedness, (b) to purchase, sell
or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such
indebtedness or to assure the holder of such indebtedness against loss in
respect of such indebtedness, (c) to supply funds to or in any other manner
invest in the debtor (including any agreement to pay for property or services
irrespective of whether such property is received or such services are
rendered) or (d) otherwise to assure a creditor against loss in respect of such
indebtedness, and (viii) all indebtedness referred to in clauses (i) through
(vii) above secured by (or for which the holder of such indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon or in
property (including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such indebtedness.
"Indemnified Party" shall have the meaning given such term in
Section 9.6.
"Insufficiency" shall mean, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities within the meaning of Section
4001(a)(18) of ERISA.
"Intercompany Indebtedness" shall mean any claim of an Affiliate of
a Borrower against any other Affiliate of a Borrower, any claim of a Borrower
against any of its Affiliates, and any claim of any Affiliate of a Borrower
against a Borrower.
"Interest Payment Date" shall mean (i) as to any Eurodollar Loan,
the last day of each consecutive thirty (30) day period running from the
commencement of the applicable Interest Period, and (ii) as to all ABR Loans,
the last calendar day of each month and the date on which any ABR Loans are
refinanced with Eurodollar Loans pursuant to Section 2.12.
"Interest Period" shall mean, as to any Borrowing of Eurodollar
Loans, the period commencing on the date of such Borrowing (including as a
result of a refinancing of ABR Loans) or on the last day of the preceding
Interest Period applicable to such Borrowing and ending on the numerically
corresponding day (or if there is no corresponding day, the last day) in the
calendar month that is one, three or six months thereafter, as the Borrowers
may elect in the related notice delivered pursuant to Section 2.6(b) or 2.12;
provided, however, that (i) if any Interest Period would end on a day which
shall not be a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day, and (ii) no Interest Period shall end later than
the Termination Date.
"Interim Commitment" shall have the meaning given such term in
Section 2.2(a).
"Interim Order" shall have the meaning given such term in Section
4.1(b).
"Interim Period" shall have the meaning given such term in Section
2.2(a).
"Inventory" shall mean all Raw Materials, Work-in-Process, and
Finished Goods held by the Borrowers in the normal course of business.
"Inventory Reserves" means the following, each as determined by the
Administrative Agent from time to time:
(a) a reserve for shrink, or discrepancies that arise pertaining to
inventory quantities on hand between the Borrowers' perpetual accounting
system, and physical counts of the Inventory, but not less than 2% of the
Eligible Inventory; or
(b) a reserve for slow move, obsolete or excess Inventory; or
(c) a reserve for favorable standard cost variances; or
(d) a reserve for amounts owing to landlords or warehousemen for
Inventory stored at leased facilities or public warehouses which are not the
subject of an access agreement acceptable to the Administrative Agent, in the
amount of (i) to the extent Borrowers' are able to determine the Borrowers'
average rental expense for such facility, three (3) times the Borrower's
average monthly rental expense for such facility plus (ii) in all other events,
the Inventory Value of the Inventory stored at such leased facilities or public
warehouses; or
(e) a reserve for Inventory located at contractors' or vendors'
facilities in the amount of the Inventory Value of such Inventory; or
(f) any other reserve as deemed appropriate by the Administrative
Agent in its exclusive discretion, from time to time; or
(g) a reserve for vendor rebates.
"Inventory Value" shall mean with respect to any Inventory of the
Borrowers at the time of any determination thereof, the standard cost carried
on the perpetual records of the Borrowers stated on a basis consistent with
their current and historical accounting practices, in Dollars, determined in
accordance with the standard cost method of accounting less, (i) any markup on
Inventory from an Affiliate and (ii) in the event variances under the standard
cost method (a) are capitalized, favorable variances shall be deducted from
Eligible Inventory, and unfavorable variances shall not be added to Eligible
Inventory, or (b) are expensed, a reserve shall be determined as appropriate in
order to adjust the standard cost of Eligible Inventory to approximate actual
cost.
"Investments" shall have the meaning given such term in Section
6.10.
"Investment Grade" shall mean either (i) at least Baa3 by Moody's
(or the then equivalent) or (ii) at least BBB- by S&P (or the then equivalent).
"JPMCB" shall have the meaning set forth in the Introduction.
"Landlord Lien Waiver" shall mean a written agreement in such form
as is reasonably acceptable to the Administrative Agent, pursuant to which a
Person shall waive or subordinate its rights and claims as landlord in any
Inventory of the Borrowers for unpaid rents, grant access to the Administrative
Agent for the repossession and sale of such inventory and make other agreements
relative thereto.
"Lenders" shall have the meaning set forth in the Introduction.
"Lender Affiliate" shall mean, (i) with respect to any Lender, (a)
an Affiliate of such Lender or (b) any entity (whether a corporation,
partnership, trust or otherwise) that is engaged in making, purchasing, holding
or otherwise investing in loans and similar extensions of credit in the
ordinary course of its business and is administered or managed by a Lender or
an Affiliate of such Lender and (ii) with respect to any Lender that is a fund
which invests in loans and similar extensions of credit, any other fund that
invests in loans and similar extensions of credit and is managed by the same
investment advisor as such Lender or by an Affiliate of such investment
advisor.
"Letter of Credit" shall mean any irrevocable letter of credit
issued pursuant to Section 2.3, which letter of credit shall be (i) a standby
or import documentary letter of credit, (ii) issued for purposes that are
consistent with the ordinary course of business of the Borrowers or for such
other purposes as are acceptable to the Administrative Agent, (iii) denominated
in Dollars and (iv) otherwise in such form as may be approved from time to time
by the Administrative Agent and the applicable Fronting Bank.
"Letter of Credit Account" shall mean the account established by
the Borrowers under the sole and exclusive control of the Administrative Agent
maintained at the office of the Administrative Agent at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 designated as the "Interstate Bakeries Corporation Letter
of Credit Account" that shall be used solely for the purposes set forth in
Sections 2.3(a) and 2.13.
"Letter of Credit Fees" shall mean the fees payable in respect of
Letters of Credit pursuant to Section 2.21.
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate undrawn stated amount of all Letters of Credit then
outstanding plus (ii) all amounts theretofore disbursed under Letters of Credit
and not then reimbursed.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including any conditional
sale or other title retention agreement or any lease in the nature thereof).
"Loan" and "Loans" shall have the respective meanings given such
terms in Section 2.1.
"Loan Documents" shall mean this Agreement, the Letters of Credit,
the Security and Pledge Agreement and any other instrument or agreement
executed and delivered in connection herewith.
"Material Adverse Effect" shall mean (i) a material adverse effect
upon the business, operations, properties, assets, condition (financial or
otherwise) or prospects (other than, with respect to prospects, as may normally
result as a consequence of the commencement of the Cases) of the Borrowers,
taken as a whole, (ii) the material impairment of the ability of the Borrowers
to perform the Obligations and (iii) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Parent
Borrower or any Subsidiary Borrower of a Loan Document to which it is a party.
"Maturity Date" shall mean September 22, 2006.
"Minority Interests" shall mean any shares of stock of any class of
a Subsidiary of the Borrowers (other than directors' qualifying shares if
required by law) that are not owned by Borrowers or one of their Subsidiaries;
Minority Interest shall be valued in accordance with GAAP.
"Minority Lenders" shall have the meaning given such term in
Section 9.10(b).
"Moody's" shall mean Xxxxx'x Investors Service, Inc. or any
successor to the rating agency business thereof.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which any Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of
the preceding five plan years made or accrued an obligation to make
contributions.
"Multiple Employer Plan" shall mean a Single Employer Plan, which
(i) is maintained for employees of a Borrower or an ERISA Affiliate and at
least one Person other than such Borrower and its ERISA Affiliates or (ii) was
so maintained and in respect of which a Borrower or an ERISA Affiliate could
have liability under Section 4064 or 4069 of ERISA in the event such Plan has
been or were to be terminated.
"Net Proceeds" shall mean, in respect of any sale of assets, the
proceeds of such sale after the payment of or reservation for expenses that are
directly related to the sale, including, but not limited to, related severance
costs, taxes payable, brokerage commissions, professional expenses, other
similar costs that are directly related to the sale and the amount secured by
valid and perfected Liens, if any, that are senior to the Liens on such assets
held by the Administrative Agent on behalf of the Lenders.
"Obligations" shall mean (i) the due and punctual payment of
principal of and interest on the Loans and the reimbursement of all amounts
drawn under Letters of Credit, and (ii) the due and punctual payment of the
Fees and all other present and future, fixed or contingent, monetary
obligations of the Borrowers to the Lenders, the Administrative Agent and the
Collateral Agent under the Loan Documents.
"Orders" shall mean, collectively, the Interim Order and the Final
Order.
"Organizational Documents" shall mean (i) with respect to any
corporation, its certificate or articles of incorporation, as amended, and its
by-laws, as amended, (ii) with respect to any limited partnership, its
certificate of limited partnership or formation, as amended, and its
partnership agreement, as amended, (iii) with respect to any general
partnership, its partnership agreement, as amended, (iv) with respect to any
limited liability company, its certificate of formation or articles of
organization, as amended, and its operating agreement, as amended, and (v) with
respect to any unlimited liability company, its certificate of formation, as
amended, and its memorandum and articles of association, as amended. In the
event any term or condition of this Agreement or any other Loan Document
requires any Organizational Document to be certified by a secretary of state of
similar governmental official, the reference to any such "Organizational
Document" shall only be to a document of a type customarily certified by such
governmental official.
"Other Taxes" shall have the meaning given such term in Section
2.18(b).
"Parent Borrower" shall have the meaning set forth in the
Introduction.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor agency or entity performing substantially the same functions.
"Pension Plan" shall mean a defined benefit pension (as defined in
Section 414(j) of the Code and Section 3(35) of ERISA) which meets and is
subject to the requirements of Section 401(a) of the Code.
"Permitted Investments" shall mean (i) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within twelve months from the date of
acquisition thereof, (ii) without limiting the provisions of paragraph (iv)
below, investments in commercial paper maturing within six months from the date
of acquisition thereof and having, at such date of acquisition, a rating of at
least "A-2" or the equivalent thereof from S&P or of at least "P-2" or the
equivalent thereof from Moody's, (iii) investments in certificates of deposit,
banker's acceptances and time deposits (including Eurodollar time deposits)
maturing within six months from the date of acquisition thereof issued or
guaranteed by or placed with (a) any domestic office of the Administrative
Agent or the bank with whom the Borrowers maintain their cash management
system, provided, that if such bank is not a Lender hereunder, such bank shall
have entered into an agreement with the Administrative Agent pursuant to which
such bank shall have waived all rights of setoff and confirmed that such bank
does not have, nor shall it claim, a security interest therein or (b) any
domestic office of any other commercial bank of recognized standing organized
under the laws of the United States of America or any State thereof that has a
combined capital and surplus and undivided profits of not less than
$250,000,000 and is the principal banking Subsidiary of a bank holding company
having a long-term unsecured debt rating of at least "A" or the equivalent
thereof from S&P or at least "A2" or the equivalent thereof from Moody's, (iv)
investments in commercial paper maturing within six months from the date of
acquisition thereof and issued by (a) the holding company of the Administrative
Agent or (b) the holding company of any other commercial bank of recognized
standing organized under the laws of the United States of America or any State
thereof that has (1) a combined capital and surplus in excess of $250,000,000
and (2) commercial paper rated at least "A-2" or the equivalent thereof from
S&P or of at least "P-2" or the equivalent thereof from Moody's, (v)
investments in repurchase obligations with a term of not more than seven (7)
days for underlying securities of the types described in clause (i) above
entered into with any office of a bank or trust company meeting the
qualifications specified in clause (iii) above, (vi) investments in money
market funds substantially all the assets of which are comprised of securities
of the types described in clauses (i) through (v) above, (vii) to the extent
owned by the Borrowers on the Filing Date, investments in the capital stock of
any direct or indirect Subsidiary of the Borrowers as disclosed in Schedule
3.5, and (viii) to the extent owned by the Borrowers on the Filing Date,
miscellaneous investments in the capital stock of any Person held by any
individual bakery, in full or partial payment for certain services rendered or
products supplied, in an aggregate amount not to exceed $1,000,000.
"Permitted Liens" shall mean (i) Liens in favor of the
Administrative Agent on behalf of the Lenders; (ii) Liens imposed by law (other
than Environmental Liens and any Lien imposed under ERISA) for taxes,
assessments or charges of any Governmental Authority for claims not yet due or
which are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves or other appropriate provisions are being
maintained in accordance with GAAP; (iii) Liens of landlords and Liens of
statutory carriers, warehousemen, mechanics, materialmen and other Liens (other
than Environmental Liens and any Lien imposed under ERISA) in existence on the
Filing Date or thereafter imposed by law and created in the ordinary course of
business; (iv) Liens (other than any Lien imposed under ERISA) incurred or
deposits made (including, without limitation, surety bonds and appeal bonds) in
connection with workers' compensation, unemployment insurance and other types
of social security benefits or to secure the performance of tenders, bids,
leases, contracts (other than for the repayment of Indebtedness), statutory
obligations and other similar obligations incurred in the ordinary course of
business; (v) easements (including, without limitation, reciprocal easement
agreements and utility agreements), rights-of-way, covenants, consents,
reservations, encroachments, variations and zoning and other restrictions,
charges or encumbrances (whether or not recorded) and interest of ground
lessors, which do not materially interfere with the ordinary conduct of the
business of any Borrower, and which do not materially detract from the value of
the property to which they attach or materially impair the use thereof to any
Borrower; (vi) purchase money Liens (including Capitalized Leases) upon or in
any property acquired or held in the ordinary course of business to secure the
purchase price of such property or to secure Indebtedness permitted by Section
6.3(iii) solely for the purpose of financing the acquisition of such property;
(vii) Liens set forth on Schedule 3.6; (viii) Liens on the assets of
Subsidiaries granted to secure Indebtedness permitted by Section 6.3(vii); (ix)
Liens created in connection with extensions, renewals or replacements,
including replacement Liens granted by the Bankruptcy Court, of any Lien
referred to in clauses (i) through (vii) above, provided that the principal
amount of the obligation secured thereby is not increased and that any such
extension, renewal or replacement is limited to the property originally
encumbered thereby; (x) pre-petition Liens granted pursuant to the Pre-Petition
Credit Agreement or the Security Documents (as defined therein) by the
Borrowers party to the Pre-Petition Credit Agreement for the benefit of the
banks and other financial institutions from time to time party to the
Pre-Petition Credit Agreement; and (xi) Liens junior to the senior liens
contemplated hereby that are granted by the Interim Order or the Final Order
pursuant to 11 U.S.C. ss.364(d)(1) as adequate protection to the Primed
Parties, provided that the Interim Order and the Final Order provide that the
holders of such junior liens shall not be permitted to take any action to
enforce their rights with respect to such junior liens as long as any amounts
are outstanding under this Agreement or the Lenders have any Commitment
hereunder.
"Person" shall mean any natural person, corporation, division of a
corporation, partnership, trust, joint venture, association, company, estate,
unincorporated organization or government or any agency or political
subdivision thereof.
"Plan" shall mean a Single Employer Plan or a Multiemployer Plan.
"Pre-Petition Credit Agreement" shall mean that certain Amended and
Restated Credit Agreement dated as of April 25, 2002, as amended, supplemented
or otherwise modified prior to the Filing Date, among the Parent Borrower and
certain of the Subsidiary Borrowers, as borrowers, the banks and other
financial institutions from time to time parties thereto, JPMCB, as
administrative agent, and others.
"Pre-Petition Payment" shall mean a payment (by way of adequate
protection or otherwise) of principal or interest or otherwise on account of
any pre-petition Indebtedness or trade payables or other pre-petition claims
against the Borrowers, including, without limitation, reclamation claims and
materialmen's liens.
"Prepayment Date" shall mean thirty-five (35) days after the entry
of the Interim Order by the Bankruptcy Court if the Final Order has not been
entered by the Bankruptcy Court prior to the expiration of such thirty-five
(35) day period.
"Primed Liens" shall have the meaning set forth in Section 2.23.
"Primed Parties" shall mean the parties who hold Primed Liens.
"Pure Food and Drug Laws" shall mean (i) the Federal Food, Drug and
Cosmetic Act, as amended from time to time, and any successor statute and (ii)
the pure food and drug laws of each of the states of the United States into
which products manufactured, marketed or sold by the Borrowers are or have been
shipped.
"Raw Materials" shall mean any items or materials used or consumed
in the manufacture of goods to be sold by the Borrowers in the ordinary course
of business.
"Real Property Component" shall mean a component of the Borrowing
Base determined with reference to the Eligible Real Property and shall mean, at
the time of any determination, an amount equal to the lesser of (i) $60,000,000
(as adjusted from time to time pursuant to Section 5.8) or (ii) 30% of the
Borrowing Base inclusive of the Real Property Component.
"Register" shall have the meaning set forth in Section 9.3(e).
"Release" shall mean actively or passively disposing, discharging,
injecting, spilling, pumping, leaking, leaching, dumping, emitting, escaping,
emptying, pouring, seeping, migrating or the like, into or upon any land or
water or air, or otherwise entering into the environment.
"Rent Reserve" shall mean, with respect to any store, warehouse
distribution center, regional distribution center or depot where any Inventory
subject to Liens arising by operation of law is located, a reserve equal to
three (3) months' rent at such store, warehouse distribution center, regional
distribution center or depot.
"Reorganization Plan" shall mean a plan of reorganization in any of
the Cases.
"Replacement Lender" shall have the meaning given such term in
Section 2.29.
"Required Lenders" shall mean, at any time, Lenders holding in
excess of 50% of the Total Commitment.
"S&P" shall mean Standard & Poor's Rating Services, a division of
The XxXxxx-Xxxx Companies, Inc., or any successor to the rating agency business
thereof.
"Security and Pledge Agreement" shall have the meaning given such
term in Section 4.1(c).
"Single Employer Plan" shall mean a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (i) is maintained for employees
of a Borrower or an ERISA Affiliate or (ii) was so maintained and in respect of
which a Borrower could have liability under Section 4069 of ERISA in the event
such Plan has been or were to be terminated.
"Statutory Reserves" shall mean on any date the percentage
(expressed as a decimal) established by the Board and any other banking
authority which is (i) for purposes of the definition of Base CD Rate, the then
stated maximum rate of all reserves (including, but not limited to, any
emergency, supplemental or other marginal reserve requirement) for a member
bank of the Federal Reserve System in New York City, for new three month
negotiable nonpersonal time deposits in dollars of $100,000 or more or (ii) for
purposes of the definition of Adjusted LIBOR Rate, the then stated maximum rate
for all reserves (including but not limited to any emergency, supplemental or
other marginal reserve requirements) applicable to any member bank of the
Federal Reserve System in respect of Eurocurrency Liabilities (or any successor
category of liabilities under Regulation D issued by the Board, as in effect
from time to time). Such reserve percentages shall include, without limitation,
those imposed pursuant to said Regulation. The Statutory Reserves shall be
adjusted automatically on and as of the effective date of any change in such
percentage.
"Subsidiary" shall mean, with respect to any Person (herein
referred to as the "parent"), any corporation, association or other business
entity (whether now existing or hereafter organized) of which at least a
majority of the securities or other ownership interests having ordinary voting
power for the election of directors is, at the time as of which any
determination is being made, owned or controlled by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"Subsidiary Borrower" and "Subsidiary Borrowers" shall have the
respective meanings set forth in the Introduction.
"Super-majority Lenders" shall have the meaning given such term in
Section 9.10(b).
"Superpriority Claim" shall mean a claim against any Borrower in
any of the Cases which is a superpriority administrative expense claim having
priority over any or all administrative expenses of the kind specified in
Sections 503(b) or 507(b) of the Bankruptcy Code.
"Taxes" shall have the meaning given such term in Section 2.18.
"Termination Date" shall mean the earliest to occur of (i) the
Prepayment Date, (ii) the Maturity Date, (iii) the Consummation Date and (iv)
the acceleration of the Loans and the termination of the Total Commitment in
accordance with the terms hereof.
"Termination Event" shall mean (i) a "reportable event", as such
term is described in Section 4043 of ERISA and the regulations issued
thereunder (other than a "reportable event" not subject to the provision for
30-day notice to the PBGC under Section 4043 of ERISA or such regulations) or
an event described in Section 4068 of ERISA excluding events described in
Section 4043(c)(9) of ERISA or 29 CFR xx.xx. 2615.21 or 2615.23, or (ii) the
withdrawal of any Borrower or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a "substantial employer", as such term is
defined in Section 4001(c) of ERISA, or the incurrence of liability by any
Borrower or any ERISA Affiliate under Section 4064 of ERISA upon the
termination of a Multiple Employer Plan, or (iii) providing notice of intent to
terminate a Plan pursuant to Section 4041(c) of ERISA or the treatment of a
Plan amendment as a termination under Section 4041 of ERISA, or (iv) the
institution of proceedings to terminate a Plan by the PBGC under Section 4042
of ERISA, or (v) any other event or condition (other than the commencement of
the Cases and the failure to have made any contribution accrued as of the
Filing Date but not paid) which would reasonably be expected to constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Plan, or the imposition of any liability under
Title IV of ERISA (other than for the payment of premiums to the PBGC).
"Total Commitment" shall mean, at any time, the sum of the
Commitments at such time.
"Total Usage" shall mean, at any time, the sum of the outstanding
aggregate principal amount of the Loans plus the aggregate Letter of Credit
Outstandings.
"Transferee" shall have the meaning given such term in Section 2.18.
"Type" when used in respect of any Loan or Borrowing shall refer to
the Rate of interest by reference to which interest on such Loan or on the
Loans comprising such Borrowing is determined. For purposes hereof, "Rate"
shall mean the Adjusted LIBOR Rate and the Alternate Base Rate.
"Unfunded Current Liability" shall mean, with respect to any
Pension Plan, the amount, if any, by which the actuarial present value of the
accumulated plan benefits under such Pension Plan as of the close of its most
recent plan year exceeds the fair market value of the assets allocable thereto,
each determined in accordance with Statement of Financial Accounting Standards
No. 35, based upon the actuarial assumptions used by such Pension Plan's
actuary in the most recent annual valuation of such Pension Plan.
"Unused Total Commitment" shall mean, at any time, (i) the Total
Commitment less (ii) the sum of (a) the aggregate outstanding principal amount
of all Loans and (b) the aggregate Letter of Credit Outstandings.
"Withdrawal Liability" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
"Work-in-Process" shall mean Inventory which consists of
work-in-process including, without limitation, materials other than Raw
Materials, Finished Goods or saleable products, title to which and sole
ownership of which is vested in a Borrower.
SECTION 1.2 Terms Generally. The definitions in Section 1.1 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. All references herein to Sections,
Exhibits and Schedules shall be deemed references to Sections of, and Exhibits
and Schedules to, this Agreement unless the context shall otherwise require.
Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; provided, however, that for purposes of determining compliance
with any covenant set forth in Section 6, such terms shall be construed in
accordance with GAAP as in effect on the date of this Agreement applied on a
basis consistent with the application used in the Borrowers' audited financial
statements referred to in Section 3.4.
SECTION 1.3 Accounting Terms; GAAPSection 1.4 . Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrowers notify the Administrative Agent that the Borrowers
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrowers that the Required Lenders request an amendment to any provision
hereof for such purpose), regardless of whether any such notice is given before
or after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.
SECTION 2. AMOUNT AND TERMS OF CREDIT.
SECTION 2.1 Commitment of the Lenders.
(a) Each Lender severally and not jointly with the other Lenders
agrees, upon the terms and subject to the conditions herein set forth, to make
revolving credit loans (each a "Loan" and collectively, the "Loans") to the
Borrowers at any time and from time to time during the period commencing on the
date hereof and ending on the Termination Date (or the earlier date of
termination of the Total Commitment) in an aggregate principal amount not to
exceed, when added to such Lender's Commitment Percentage of the then aggregate
Letter of Credit Outstandings, the Commitment of such Lender, which Loans may
be repaid and reborrowed in accordance with the provisions of this Agreement.
(b) Each Borrowing shall be made by the Lenders pro rata in
accordance with their respective Commitments; provided, however, that the
failure of any Lender to make any Loan shall not in itself relieve the other
Lenders of their obligations to lend.
SECTION 2.2 Availability of Commitment; Borrowing Base.
(a) Subject to the terms, conditions and covenants hereof, during
the period commencing on the Filing Date and ending on the date the Bankruptcy
Court enters the Final Order (such period being referred to as the "Interim
Period"), $50,000,000 of the Total Commitment (the "Interim Commitment") shall
be available to the Borrowers without regard to the Borrowing Base, (but
otherwise subject to the terms, conditions and covenants described in this
Agreement).
(b) Upon the expiration of the Interim Period, the Borrowing Base
shall become operative with respect to the availability of Loans and Letters of
Credit under the Commitment, and $150,000,000 of the Total Commitment (the
"Available Commitment") shall be available to the Borrowers (subject to
compliance with the Borrowing Base and the terms, conditions and covenants
described in this Agreement).
(c) On the first Business Day after (i) the expiration of the
Interim Period and (ii) the Borrowers shall have delivered and both the
Administrative Agent and Xxxxxxxx Xxxxxx & Company or such other financial
advisor as may be acceptable to the Administrative Agent shall have accepted
the Budget in accordance with Section 5.1(f) hereof (such Business Day being
referred to as the "Budget Acceptance Date"), the Total Commitment shall be
available to the Borrowers (subject to compliance with the Borrowing Base and
the terms, conditions and covenants in this Agreement).
(d) Notwithstanding any other provision of this Agreement to the
contrary, Total Usage shall not at any time exceed (i) prior to the expiration
of the Interim Period, the Interim Commitment, (ii) from and after the
expiration of the Interim Period but prior to the Budget Acceptance Date, the
lesser of (x) the Available Commitment and (y) the Borrowing Base, and (iii)
from and after the Budget Acceptance Date, the lesser of (x) the Total
Commitment (as such Total Commitment may be reduced from time to time pursuant
to the terms of this Agreement) and (y) the Borrowing Base, and no Loan shall
be made or Letter of Credit issued in violation of the foregoing.
SECTION 2.3 Letters of Credit.
(a) Upon the terms and subject to the conditions herein set forth,
the Borrowers may request a Fronting Bank, at any time and from time to time
after the date hereof and prior to the Termination Date, to issue, and, subject
to the terms and conditions contained herein, such Fronting Bank shall issue,
for the account of the Borrowers one or more Letters of Credit in support of
obligations of the Borrowers or one or more of the Subsidiaries, provided that
no Letter of Credit shall be issued if after giving effect to such issuance (i)
the aggregate Letter of Credit Outstandings would exceed $75,000,000, or (ii)
the Total Usage would exceed (x) prior to the expiration of the Interim Period,
the Interim Commitment, (y) from and after the expiration of the Interim Period
but prior to the Budget Acceptance Date, the lesser of (aa) the Available
Commitment and (bb) the Borrowing Base, and (z) from and after the Budget
Acceptance Date, the lesser of (cc) the Total Commitment and (dd) the Borrowing
Base.
(b) No Letter of Credit shall expire later than sixty (60) days
after the Maturity Date, provided that if the Termination Date shall occur
prior to the expiration of any Letter of Credit, the Borrowers shall, at or
prior to the Termination Date, except as the Administrative Agent may otherwise
agree in writing, (i) cause all Letters of Credit which expire after the
Termination Date to be returned to the Fronting Bank undrawn and marked
"canceled" or (ii) if the Borrowers are unable to do so in whole or in part,
either (x) provide a "back-to-back" letter of credit to one or more Fronting
Banks in a form satisfactory to such Fronting Bank and the Administrative Agent
(in their exclusive discretion), issued by a bank satisfactory to such Fronting
Bank and the Administrative Agent (in their exclusive discretion), in an amount
equal to the greater of (A) an amount, as determined by the Fronting Bank and
the Administrative Agent, equal to the face amount of all outstanding Letters
of Credit plus the sum of all projected contractual obligations to the
Administrative Agent, the Fronting Bank and the Lenders of the Borrowers
thereunder through the expiration date(s) of such Letters of Credit, and (B)
105% of the then undrawn stated amount of all outstanding Letters of Credit
issued by such Fronting Banks and/or (y) deposit cash in the Letter of Credit
Account in an amount which, together with any amounts then held in the Letter
of Credit Account, is equal to the greater of (A) an amount, as determined by
the Fronting Bank and the Administrative Agent, equal to the face amount of all
outstanding Letters of Credit plus the sum of all projected contractual
obligations to the Administrative Agent, the Fronting Bank and the Lenders of
the Borrowers thereunder through the expiration date(s) of such Letters of
Credit, and (B) 105% of the then undrawn stated amount of all Letter of Credit
Outstandings as collateral security for the Borrowers' reimbursement
obligations in connection therewith, such cash to be promptly remitted to the
Borrowers upon the expiration, cancellation or other termination or
satisfaction of such reimbursement obligations.
(c) The Borrowers shall pay to each Fronting Bank, in addition to
such other fees and charges as are specifically provided for in Section 2.21
hereof, such fees and charges in connection with the issuance and processing of
the Letters of Credit issued by such Fronting Bank as are customarily imposed
by such Fronting Bank from time to time in connection with letter of credit
transactions.
(d) Drafts drawn under each Letter of Credit shall be reimbursed by
the Borrowers in Dollars not later than the first Business Day following the
date of draw and shall bear interest from the date of draw until the first
Business Day following the date of draw at a rate per annum equal to the
Alternate Base Rate plus 1.75% and thereafter until reimbursed in full at a
rate per annum equal to the Alternate Base Rate plus 3.75% (computed on the
basis of the actual number of days elapsed over a year of 360 days). The
Borrowers shall effect such reimbursement (x) if such draw occurs prior to the
Termination Date (or the earlier date of termination of the Total Commitment),
in cash or through a Borrowing of Loans without the satisfaction of the
conditions precedent set forth in Section 4.2 or (y) if such draw occurs on or
after the Termination Date (or the earlier date of termination of the Total
Commitment), in cash. Each Lender agrees to make the Loans described in clause
(x) of the preceding sentence notwithstanding a failure to satisfy the
applicable lending conditions thereto or the provisions of Section 2.29.
(e) Immediately upon the issuance of any Letter of Credit by any
Fronting Bank, such Fronting Bank shall be deemed to have sold to each Lender
other than such Fronting Bank and each such other Lender shall be deemed
unconditionally and irrevocably to have purchased from such Fronting Bank,
without recourse or warranty, an undivided interest and participation, to the
extent of such Lender's Commitment Percentage, in such Letter of Credit, each
drawing thereunder and the obligations of the Borrowers under this Agreement
with respect thereto. Upon any change in the Commitments pursuant to Section
9.3, it is hereby agreed that with respect to all Letter of Credit
Outstandings, there shall be an automatic adjustment to the participations
hereby created to reflect the new Commitment Percentages of the assigning and
assignee Lenders. Any action taken or omitted by a Fronting Bank under or in
connection with a Letter of Credit, if taken or omitted in the absence of gross
negligence or willful misconduct, shall not create for such Fronting Bank any
resulting liability to any other Lender.
(f) In the event that a Fronting Bank makes any payment under any
Letter of Credit and the Borrowers shall not have reimbursed such amount in
full to such Fronting Bank pursuant to this Section, the Fronting Bank shall
promptly notify the Administrative Agent, which shall promptly notify each
Lender of such failure, and each Lender shall promptly and unconditionally pay
to the Administrative Agent for the account of the Fronting Bank the amount of
such Lender's Commitment Percentage of such unreimbursed payment in Dollars and
in same day funds. If the Fronting Bank so notifies the Administrative Agent,
and the Administrative Agent so notifies the Lenders prior to 12:00 p.m. (New
York City time) on any Business Day, such Lenders shall make available to the
Fronting Bank such Lender's Commitment Percentage of the amount of such payment
on such Business Day in same day funds. If and to the extent such Lender shall
not have so made its Commitment Percentage of the amount of such payment
available to the Fronting Bank, such Lender agrees to pay to such Fronting
Bank, forthwith on demand such amount, together with interest thereon, for each
day from such date until the date such amount is paid to the Administrative
Agent for the account of such Fronting Bank at the Federal Funds Effective
Rate. The failure of any Lender to make available to the Fronting Bank its
Commitment Percentage of any payment under any Letter of Credit shall not
relieve any other Lender of its obligation hereunder to make available to the
Fronting Bank its Commitment Percentage of any payment under any Letter of
Credit on the date required, as specified above, but no Lender shall be
responsible for the failure of any other Lender to make available to such
Fronting Bank such other Lender's Commitment Percentage of any such payment.
Whenever a Fronting Bank receives a payment of a reimbursement obligation as to
which it has received any payments from the Lenders pursuant to this paragraph,
such Fronting Bank shall pay to each Lender which has paid its Commitment
Percentage thereof, in Dollars and in same day funds, an amount equal to such
Lender's Commitment Percentage thereof.
(g) Unless otherwise requested by the Administrative Agent, each
Fronting Bank shall report in writing to the Administrative Agent (i) on the
first Business Day of each week, the daily activity (set forth by day) in
respect of Letters of Credit during the immediately preceding week, including
all issuances, extensions, amendments and renewals, all expirations and
cancellations and all disbursements and reimbursements, (ii) on or prior to
each Business Day on which such Fronting Bank expects to issue, amend, renew or
extend any Letter of Credit, the date of such issuance, amendment, renewal or
extension and the aggregate face amount of the Letters of Credit to be issued,
amended, renewed or extended by it and outstanding after giving effect to such
issuance, amendment, renewal or extension (and whether the amount thereof
changed), it being understood that such Fronting Bank shall not permit any
issuance, renewal, extension or amendment resulting in an increase in the
amount of a Letter of Credit to occur without first obtaining written
confirmation from the Administrative Agent that it is then permitted under this
Agreement, (iii) on each Business Day on which such Fronting Bank makes any
payment under any Letter of Credit, the date of such payment and the amount of
such payment, (iv) on any Business Day on which a Borrower fails to reimburse a
payment under a Letter of Credit required to be reimbursed to such Fronting
Bank on such day, the date of such failure, the applicable Borrower and the
amount and currency of such Letter of Credit payment and (v) on any other
Business Day, such other information as the Administrative Agent shall
reasonably request.
SECTION 2.4 Issuance. Whenever the Parent Borrower or a Subsidiary
Borrower desire a Fronting Bank to issue a Letter of Credit, they shall give to
such Fronting Bank and the Administrative Agent at least three (3) Business
Days' prior written (including facsimile communication) notice (or such shorter
period as may be agreed upon by the Administrative Agent, the Borrowers and the
Fronting Bank) specifying the date on which the proposed Letter of Credit is to
be issued (which shall be a Business Day), the stated amount of the Letter of
Credit so requested, the expiration date of such Letter of Credit and the name
and address of the beneficiary thereof.
SECTION 2.5 Nature of Letter of Credit Obligations Absolute. The
obligations of the Borrowers to reimburse the Lenders for drawings made under
any Letter of Credit shall be joint and several, unconditional and irrevocable
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including, without limitation: (i) any lack of validity or
enforceability of any Letter of Credit; (ii) the existence of any claim,
setoff, defense or other right which any Borrower may have at any time against
a beneficiary of any Letter of Credit or against any of the Lenders, whether in
connection with this Agreement, the transactions contemplated herein or any
unrelated transaction; (iii) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; (iv) payment by a Fronting Bank of any Letter of
Credit against presentation of a demand, draft or certificate or other document
which does not comply with the terms of such Letter of Credit; (v) any other
circumstance or happening whatsoever, which is similar to any of the foregoing;
or (vi) the fact that any Event of Default shall have occurred and be
continuing.
SECTION 2.6 Making of Loans.
(a) Except as contemplated by Section 2.11, Loans shall be either
ABR Loans or Eurodollar Loans as the Borrowers may request subject to and in
accordance with this Section, provided that all Loans made pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, be Loans of the
same Type. Each Lender may fulfill its Commitment with respect to any
Eurodollar Loan or ABR Loan by causing any lending office of such Lender to
make such Loan; provided that any such use of a lending office shall not affect
the obligation of the Borrowers to repay such Loan in accordance with the terms
of this Agreement. Each Lender shall, subject to its overall policy
considerations, use reasonable efforts (but shall not be obligated) to select a
lending office which will not result in the payment of increased costs by the
Borrowers pursuant to Sections 2.15 or 2.18. Subject to the other provisions of
this Section and the provisions of Section 2.12, Borrowings of Loans of more
than one Type may be incurred at the same time, provided that no more than
twelve (12) Borrowings of Eurodollar Loans may be outstanding at any time.
(b) The applicable Borrower shall give the Administrative Agent
prior written, facsimile or telephonic (confirmed promptly in writing) notice
of each Borrowing of Loans hereunder of at least three (3) Business Days for
Eurodollar Loans and one (1) Business Day for ABR Loans (subject, in the case
of ABR Loans, to the last sentence of this Section); such notice shall be
irrevocable and shall specify the amount of the proposed Borrowing (which shall
not be less than $5,000,000 for Eurodollar Loans and $1,000,000 for ABR Loans,
or any integral multiple of $1,000,000 in excess of such minimum amounts) and
the date thereof (which shall be a Business Day) and shall contain disbursement
instructions. Such notice, to be effective, must be received by the
Administrative Agent not later than 12:00 p.m., New York City time, on the
third Business Day in the case of Eurodollar Loans and the first Business Day
in the case of ABR Loans, preceding the date on which such Borrowing is to be
made except as provided in the last sentence of this Section 2.06(b). Such
notice shall specify whether the Borrowing then being requested is to be a
Borrowing of ABR Loans or Eurodollar Loans. If no election is made as to the
Type of Loan, such notice shall be deemed a request for Borrowing of ABR Loans.
The Administrative Agent shall promptly notify each Lender of its proportionate
share of such Borrowing, the date of such Borrowing, the Type of Borrowing or
Loans being requested and the Interest Period or Interest Periods applicable
thereto, as appropriate. On the Borrowing date specified in such notice, each
Lender shall make its share of the Borrowing available at the office of the
Administrative Agent at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, no later
than 12:00 p.m., New York City time, in immediately available funds. Upon
receipt of the funds made available by the Lenders to fund any Borrowing
hereunder, the Administrative Agent shall disburse such funds in the manner
specified in the notice of Borrowing delivered by the Borrowers. With respect
to ABR Loans in an aggregate amount of up to $3,000,000, the Lenders shall make
such Borrowings available to the Administrative Agent no later than 12:00 p.m.,
New York City time, in immediately available funds, and the Administrative
Agent shall disburse such Borrowings in accordance with the applicable
Borrower's instructions consistent with this Agreement by 3:00 p.m., New York
City time, on the same Business Day that such Borrower gives notice to the
Administrative Agent of such Borrowing by 10:00 a.m., New York City time.
SECTION 2.7 Repayment of Loans and Unreimbursed Draws; Evidence of Debt.
(a) The Borrowers hereby jointly and severally unconditionally
promise to pay to the Administrative Agent for the account of each Lender the
then unpaid principal amount of each Loan and each unreimbursed draw under all
Letters of Credit as set forth herein.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the Indebtedness of the Parent
Borrower and the Subsidiary Borrowers to such Lender resulting from each Loan
made by such Lender or participation in each Letter of Credit in which such
Lender is participating, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made hereunder, the Type thereof and
the Interest Period applicable thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Parent Borrower
or the Subsidiary Borrowers, as the case may be, to each Lender hereunder and
(iii) the amount of any sum received by the Administrative Agent hereunder for
the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the
Borrowers to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrowers shall execute and deliver to such
Lender a promissory note payable to the order of such Lender (or, if requested
by such Lender, to such Lender and its registered assigns) in a form furnished
by the Administrative Agent. Thereafter, the Loans evidenced by such promissory
note and interest thereon shall at all times (including after assignment
pursuant to Section 9.3) be represented by one or more promissory notes in such
form payable to the order of the payee named therein (or, if such promissory
note is a registered note, to such payee and its registered assigns).
SECTION 2.8 Interest on Loans.
(a) Subject to the provisions of Section 2.9, each ABR Loan shall
bear interest (computed, for ABR Loans wherein the Alternate Base Rate is
determined by reference to the Base CD Rate or the Federal Funds Effective
Rate, on the basis of the actual number of days elapsed over a year of 360
days, and otherwise computed on the basis of the actual number of days elapsed
over a year of 365 days) at a rate per annum equal to the Alternate Base Rate
plus 1.75%.
(b) Subject to the provisions of Section 2.9, each Eurodollar Loan
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 360 days) at a rate per annum equal, during each Interest Period
applicable thereto, to the Adjusted LIBOR Rate for such Interest Period in
effect for such Borrowing plus 2.75%.
(c) Accrued interest on all Loans shall be payable in arrears on
each Interest Payment Date applicable thereto, at maturity (whether by
acceleration or otherwise), after such maturity on demand and (with respect to
Eurodollar Loans) upon any repayment or prepayment thereof (on the amount
prepaid).
SECTION 2.9 Default Interest. If any Borrower shall default in the
payment of the principal of or interest on any Loan or in the payment of any
other amount becoming due hereunder (including, without limitation, the
reimbursement pursuant to Section 2.3(d) of any draft drawn under a Letter of
Credit), whether at stated maturity, by acceleration or otherwise, such
Borrower shall on demand from time to time pay interest, to the extent
permitted by law, on such defaulted amount up to (but not including) the date
of actual payment (after as well as before judgment) at a rate per annum
(computed on the basis of the actual number of days elapsed over a year of 360
days) equal to 2% above the then applicable rate.
SECTION 2.10 Optional Termination or Reduction of Commitment. Upon
at least three (3) Business Days' prior written notice to the Administrative
Agent, the Borrowers may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Unused Total Commitment. Each such
reduction or termination, as applicable, of the Unused Total Commitment shall
be in the principal amount of $1,000,000 or any integral multiple of $1,000,000
in excess thereof. Any reduction or termination, as applicable, pursuant to
this Section shall be deemed to be a reduction or termination, as applicable,
in the amount of such reduction or termination of the Total Commitment and
shall be applied pro rata to reduce the applicable Commitment of each Lender.
Simultaneously with each reduction or termination, as applicable, of the Unused
Total Commitment, the Borrowers shall pay to the Administrative Agent for the
account of each Lender the Commitment Fee accrued on the amount of the
Commitment of such Lender so terminated or reduced through the date thereof.
SECTION 2.11 Alternate Rate of Interest. In the event, and on each
occasion, that on the day three (3) Business Days prior to the commencement of
any Interest Period for a Eurodollar Loan, the Administrative Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrowers absent manifest error) that reasonable means do not exist for
ascertaining the applicable Adjusted LIBOR Rate, the Administrative Agent
shall, as soon as practicable thereafter, give written notice of such
determination to the Borrowers and the Lenders, and any request by the
Borrowers for a Borrowing of Eurodollar Loans (including pursuant to a
refinancing with Eurodollar Loans) pursuant to Section 2.6 or 2.12 shall be
deemed a request for a Borrowing of ABR Loans. After such notice shall have
been given and until the circumstances giving rise to such notice no longer
exist, each request for a Borrowing of Eurodollar Loans shall be deemed to be a
request for a Borrowing of ABR Loans.
SECTION 2.12 Refinancing of Loans. The Borrowers shall have the right, at
any time, on three (3) Business Days' prior irrevocable notice to the
Administrative Agent (which notice, to be effective, must be received by the
Administrative Agent not later than 1:00 p.m., New York City time, on the third
Business Day preceding the date of any refinancing), (x) to refinance (without
the satisfaction of the conditions set forth in Section 4.2 as a condition to
such refinancing) any outstanding Borrowing or Borrowings of Loans of one Type
(or a portion thereof) with a Borrowing of Loans of the other Type or (y) to
continue an outstanding Borrowing of Eurodollar Loans for an additional
Interest Period, subject to the following:
(a) as a condition to the refinancing of ABR Loans with Eurodollar
Loans and to the continuation of Eurodollar Loans for an additional Interest
Period, no Event of Default shall have occurred and be continuing at the time
of such refinancing;
(b) if less than a full Borrowing of Loans shall be refinanced,
such refinancing shall be made pro rata among the Lenders in accordance with
the respective principal amounts of the Loans comprising such Borrowing held by
the Lenders immediately prior to such refinancing;
(c) the aggregate principal amount of Loans being refinanced shall
be at least $5,000,000 or any integral multiple of $1,000,000 in excess
thereof, provided that no partial refinancing of a Borrowing of Eurodollar
Loans shall result in the Eurodollar Loans remaining outstanding pursuant to
such Borrowing being less than $5,000,000 in aggregate principal amount;
(d) each Lender shall effect each refinancing by applying the
proceeds of its new Eurodollar Loan or ABR Loan, as the case may be, to its
Loan being refinanced;
(e) the Interest Period with respect to a Borrowing of Eurodollar
Loans effected by a refinancing or in respect to the Borrowing of Eurodollar
Loans being continued as Eurodollar Loans shall commence on the date of
refinancing or the expiration of the current Interest Period applicable to such
continuing Borrowing, as the case may be;
(f) a Borrowing of Eurodollar Loans may be refinanced only on the
last day of an Interest Period applicable thereto; and
(g) each request for a refinancing with a Borrowing of Eurodollar
Loans which fails to state an applicable Interest Period shall be deemed to be
a request for an Interest Period of one month.
In the event that the Parent Borrower or a Subsidiary Borrower, as
applicable, shall not give notice to refinance any Borrowing of Eurodollar
Loans, or to continue such Borrowing as Eurodollar Loans, or shall not be
entitled to refinance or continue such Borrowing as Eurodollar Loans, in each
case as provided above, such Borrowing shall automatically be refinanced with a
Borrowing of ABR Loans at the expiration of the then-current Interest Period.
The Administrative Agent shall, after it receives notice from the Parent
Borrower or a Subsidiary Borrower, as applicable, promptly give each Lender
notice of any refinancing, in whole or part, of any Loan made by such Lender.
SECTION 2.13 Mandatory Prepayment; Commitment Termination.
(a) If at any time the aggregate principal amount of the
outstanding Loans plus the aggregate Letter of Credit Outstandings exceeds (A)
prior to the expiration of the Interim Period, the Interim Commitment, (B) from
and after the expiration of the Interim Period and prior to the Budget
Acceptance Date, the lesser of (x) the Available Commitment and (y) the
Borrowing Base, or (C) from and after the Budget Acceptance Date, the lesser of
(x) the Total Commitment and (y) the Borrowing Base, the Borrowers will within
one (1) Business Day (i) prepay the Loans in an amount necessary to cause the
aggregate principal amount of the outstanding Loans plus the aggregate Letter
of Credit Outstandings, including unreimbursed draws, to be equal to or less
than (A) prior to the expiration of the Interim Period, the Interim Commitment,
(B) from and after the expiration of the Interim Period and prior to the Budget
Acceptance Date, the lesser of (x) the Available Commitment and (y) the
Borrowing Base, and (C) from and after the Budget Acceptance Date, the lesser
of (x) the Total Commitment and (y) the Borrowing Base and (ii) if, after
giving effect to the prepayment in full of the Loans, the aggregate Letter of
Credit Outstandings exceeds (A) prior to the expiration of the Interim Period,
the Available Commitment, (B) from and after the expiration of the Interim
Period and prior to the Budget Acceptance Date, the lesser of (x) the Available
Commitment and (y) the Borrowing Base, (C) from and after the Budget Acceptance
Date, the lesser of (x) the Total Commitment and (y) the Borrowing Base,
deposit into the Letter of Credit Account an amount equal to 105% of the amount
by which the aggregate Letter of Credit Outstandings (net of the amount of cash
held in the Letter of Credit Account) so exceeds (A) prior to the expiration of
the Interim Period, the Interim Commitment, (B) from and after the expiration
of the Interim Period and prior to the Budget Acceptance Date, the lesser of
(x) the Available Commitment and (y) the Borrowing Base, and (C) from and after
the Budget Acceptance Date, the lesser of (x) the Total Commitment and (y) the
Borrowing Base.
(b) Upon the receipt of the Net Proceeds by any of the Borrowers or
their Subsidiaries from any Asset Sales for which the consideration received by
the Borrowers, taken together with any other Asset Sales, exceeds $5,000,000 in
the aggregate from the date of this Agreement, the Borrowers shall, jointly and
severally, apply such Net Proceeds as follows: first, to repay the then
outstanding Loans; second, deposit an amount in the Letter of Credit Account up
to 105% of the then Letter of Credit Outstandings; and thereafter, such Net
Proceeds may be retained by the Borrowers and invested in Permitted Investments
or used for expenditures in the ordinary course of business (subject to
compliance with the terms and conditions of this Agreement). Prepayments of the
Loans pursuant to the foregoing shall be effected as follows: the Commitments
shall be reduced on a pro rata basis by an aggregate amount equal to the Net
Proceeds of the subject Asset Sale required to be paid to the Lenders
hereunder; and the Loans shall be prepaid in an amount equal to the decrease in
the Total Commitment.
(c) Upon the Termination Date, the Total Commitment shall be
terminated in full and the Borrowers shall pay the Loans in full and, if any
Letter of Credit remains outstanding, comply with Section 2.3(b).
SECTION 2.14 Optional Prepayment of Loans; Reimbursement of Lenders.
(a) The Borrowers shall have the right at any time and from time to
time to prepay any Loans without penalty (except for any breakage costs
associated with Eurodollar Loans), in whole or in part, (x) with respect to
Eurodollar Loans, upon at least three (3) Business Days' prior written,
facsimile or telephonic (confirmed promptly in writing) notice to the
Administrative Agent and (y) with respect to ABR Loans, upon at least one (1)
Business Day's prior written, facsimile or telephonic (confirmed promptly in
writing) notice to the Administrative Agent; provided, however, that (i) each
such partial prepayment shall be in integral multiples of $1,000,000, (ii) no
prepayment of Eurodollar Loans shall be permitted pursuant to this Section
2.14(a) other than on the last day of an Interest Period applicable thereto
unless such prepayment is accompanied by the payment of the amounts described
in clause (i) of the first sentence of Section 2.14(b), and (iii) no partial
prepayment of a Borrowing of Eurodollar Loans shall result in the aggregate
principal amount of the Eurodollar Loans remaining outstanding pursuant to such
Borrowing being less than $5,000,000. Each notice of prepayment shall specify
the prepayment date, the principal amount of the Loans to be prepaid and in the
case of Eurodollar Loans, the Borrowing or Borrowings pursuant to which made,
shall be irrevocable and shall commit the Parent Borrower or a Subsidiary
Borrower, as the case may be, to prepay such Loan by the amount and on the date
stated therein. The Administrative Agent shall, promptly after receiving notice
from the Parent Borrower or a Subsidiary Borrower, as the case may be,
hereunder, notify each Lender of the principal amount of the Loans held by such
Lender which are to be prepaid, the prepayment date and the manner of
application of the prepayment.
(b) The Borrowers shall reimburse each Lender on demand for any
loss incurred or to be incurred by it in the reemployment of the funds released
(i) resulting from any prepayment (for any reason whatsoever, including,
without limitation, refinancing with ABR Loans) of any Eurodollar Loan required
or permitted under this Agreement, if such Loan is prepaid other than on the
last day of the Interest Period for such Loan (including, without limitation,
any such prepayment in connection with the syndication of the credit facility
evidenced by this Agreement) or (ii) in the event that after the Borrowers
deliver a notice of Borrowing under Section 2.6 in respect of Eurodollar Loans,
such Loans are not made on the first day of the Interest Period specified in
such notice of Borrowing for any reason other than a breach by such Lender of
its obligations hereunder. Such loss shall be the amount as reasonably
determined by such Lender as the excess, if any, of (A) the amount of interest
which would have accrued to such Lender on the amount so paid or not borrowed
at a rate of interest equal to the Adjusted LIBOR Rate for such Loan, for the
period from the date of such payment or failure to borrow to the last day (x)
in the case of a payment or refinancing with ABR Loans other than on the last
day of the Interest Period for such Loan, of the then current Interest Period
for such Loan, or (y) in the case of such failure to borrow, of the Interest
Period for such Loan which would have commenced on the date of such failure to
borrow, over (B) the amount of interest which would have accrued to such Lender
on such amount by placing such amount on deposit for a comparable period with
leading banks in the London interbank market. Each Lender shall deliver to the
Borrowers from time to time one or more certificates setting forth the amount
of such loss as determined by such Lender.
(c) In the event the Parent Borrower or a Subsidiary Borrower, as
the case may be, fails to prepay any Loan on the date specified in any
prepayment notice delivered pursuant to Section 2.14(a), the Parent Borrower or
the applicable Subsidiary Borrower, as the case may be, on demand by any Lender
shall pay to the Administrative Agent for the account of such Lender any
amounts required to compensate such Lender for any loss incurred by such Lender
as a result of such failure to prepay, including, without limitation, any loss,
cost or expenses incurred by reason of the acquisition of deposits or other
funds by such Lender to fulfill deposit obligations incurred in anticipation of
such prepayment, but without duplication of any amounts paid under Section
2.14(b). Each Lender shall deliver to the Parent Borrower or the applicable
Subsidiary Borrower, as the case may be, from time to time one or more
certificates setting forth the amount of such loss as determined by such
Lender.
(d) Any partial prepayment of the Loans by the Parent Borrower or a
Subsidiary Borrower, as the case may be, pursuant to Sections 2.13 or 2.14
shall be applied as specified by the Parent Borrower or the applicable
Subsidiary Borrower, as the case may be, or, in the absence of such
specification, as determined by the Administrative Agent, provided that in the
latter case no Eurodollar Loans shall be prepaid pursuant to Section 2.13 to
the extent that such Loan has an Interest Period ending after the required date
of prepayment unless and until all outstanding ABR Loans and Eurodollar Loans
with Interest Periods ending on such date have been repaid in full.
SECTION 2.15 Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date
of this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender of
the principal of or interest on any Eurodollar Loan made by such Lender or any
fees or other amounts payable hereunder (other than changes in respect of
Taxes, Other Taxes and taxes imposed on, or measured by, the net income or
overall gross receipts or franchise taxes of such Lender by the jurisdiction in
which such Lender has its principal office or in which the applicable lending
office for such Eurodollar Loan is located or by any political subdivision or
taxing authority therein, or by any other jurisdiction or by any political
subdivision or taxing authority therein other than a jurisdiction in which such
Lender would not be subject to tax but for the execution and performance of
this Agreement), or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of or credit extended by such Lender (except any such reserve
requirement which is reflected in the Adjusted LIBOR Rate) or shall impose on
such Lender or the London interbank market any other condition affecting this
Agreement or the Eurodollar Loans made by such Lender, and the result of any of
the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Loan or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise) by an amount deemed by such Lender to be material, then the
Borrowers will pay to such Lender in accordance with paragraph (c) below such
additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.
(b) If any Lender shall have determined that the adoption or
effectiveness after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's holding company, if any, as a consequence of this Agreement, the Loans
made by such Lender pursuant hereto, such Lender's Commitment hereunder or the
issuance of, or participation in, any Letter of Credit by such Lender to a
level below that which such Lender or such Lender's holding company could have
achieved but for such adoption, change or compliance (taking into account
Lender's policies and the policies of such Lender's holding company with
respect to capital adequacy) by an amount deemed by such Lender to be material,
then from time to time the Borrowers shall pay to such Lender such additional
amount or amounts as will compensate such Lender or such Lender's holding
company for any such reduction suffered.
(c) A certificate of each Lender setting forth such amount or
amounts as shall be necessary to compensate such Lender or its holding company
as specified in paragraph (a) or (b) above, as the case may be, shall be
delivered to the Borrowers and shall be conclusive absent manifest error. The
Borrowers shall pay each Lender the amount shown as due on any such certificate
delivered to it within ten (10) days after its receipt of the same. Any Lender
receiving any such payment shall promptly make a refund thereof to the
Borrowers if the law, regulation, guideline or change in circumstances giving
rise to such payment is subsequently deemed or held to be invalid or
inapplicable.
(d) Failure on the part of any Lender to demand compensation for
any increased costs or reduction in amounts received or receivable or reduction
in return on capital with respect to any period shall not constitute a waiver
of such Lender's right to demand compensation with respect to such period or
any other period. The protection of this Section shall be available to each
Lender regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, guideline or other change or
condition which shall have occurred or been imposed. Section 2.16 Change in
Legality.
(a) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, if (x) any change after the date of this Agreement in any law
or regulation or in the interpretation thereof by any Governmental Authority
charged with the administration thereof shall make it unlawful for a Lender to
make or maintain a Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to a Eurodollar Loan or (y) at any time any
Lender determines that the making or continuance of any of its Eurodollar Loans
has become impracticable as a result of a contingency occurring after the date
hereof which adversely affects the London interbank market or the position of
such Lender in such market, then, by written notice to the Borrowers, such
Lender may (i) declare that Eurodollar Loans will not thereafter be made by
such Lender hereunder, whereupon any request by the Borrowers for a Eurodollar
Borrowing shall, as to such Lender only, be deemed a request for an ABR Loan
unless such declaration shall be subsequently withdrawn; and (ii) require that
all outstanding Eurodollar Loans made by it be converted to ABR Loans, in which
event all such Eurodollar Loans shall be automatically converted to ABR Loans
as of the effective date of such notice as provided in paragraph (b) below. In
the event any Lender shall exercise its rights under clause (i) or (ii) of this
paragraph (a), all payments and prepayments of principal which would otherwise
have been applied to repay the Eurodollar Loans that would have been made by
such Lender or the converted Eurodollar Loans of such Lender shall instead be
applied to repay the ABR Loans made by such Lender in lieu of, or resulting
from the conversion of, such Eurodollar Loans.
(b) For purposes of this Section 2.16, a notice to the Borrowers by
any Lender pursuant to paragraph (a) above shall be effective, if lawful, and
if any Eurodollar Loans shall then be outstanding, on the last day of the
then-current Interest Period, otherwise, such notice shall be effective on the
date of receipt by the Borrowers.
SECTION 2.17 Pro Rata Treatment, etc. All payments and repayments of
principal and interest in respect of the Loans (except as provided in Sections
2.15 and 2.16) shall be made pro rata among the Lenders in accordance with the
then outstanding principal amount of the Loans and/or participations in Letter
of Credit Outstandings hereunder and all payments of Commitment Fees and Letter
of Credit Fees (other than those payable to a Fronting Bank) shall be made pro
rata among the Lenders in accordance with their Commitments. All payments by
the Borrowers hereunder shall be (i) except as otherwise provided in Section
2.18, net of any tax applicable to the Borrowers and (ii) made in Dollars in
immediately available funds, without defense, setoff or counterclaim and free
of any restriction or condition, at the office of the Administrative Agent by
12:00 p.m., New York City time, on the date on which such payment shall be due.
Interest in respect of any Loan hereunder shall accrue from and including the
date of such Loan to but excluding the date on which such Loan is paid in full
or converted to a Loan of a different Type.
SECTION 2.18 Taxes.
(a) Except as otherwise provided in this Section 2.18, any and all
payments by the Borrowers hereunder shall be made free and clear of and without
deduction for any and all current or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding
(i) taxes imposed on or measured by the net income, net profit or overall gross
receipts of the Administrative Agent or any Lender (or any transferee or
assignee thereof, including a participation holder (any such entity being
called a "Transferee")) and franchise taxes imposed on the Administrative Agent
or any Lender (or Transferee) by the United States or any jurisdiction under
the laws of which the Administrative Agent or any such Lender (or Transferee)
is organized or in which the applicable lending office of any such Lender (or
Transferee) or applicable office of the Administrative Agent, is located or any
political subdivision thereof or by any other jurisdiction or by any political
subdivision or taxing authority therein other than a jurisdiction in which the
Administrative Agent or such Lender (or Transferee) would not be subject to tax
but for the execution and performance of this Agreement and (ii) taxes, levies,
imposts, deductions, charges or withholdings ("Amounts") with respect to
payments hereunder to a Lender (or Transferee) or the Administrative Agent in
accordance with laws in effect on the later of the date of this Agreement and
the date such Lender (or Transferee) or the Administrative Agent becomes a
Lender (or Transferee or Administrative Agent, as the case may be) but not
excluding, with respect to such Lender (or Transferee) or the Administrative
Agent, any increase in such Amounts solely as a result of any change in such
laws occurring after such later date or any Amounts that would not have been
imposed but for actions (other than actions contemplated by this Agreement)
taken by the Borrowers after such later date (all such nonexcluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrowers shall be required by law
to deduct any Taxes from or in respect of any sum payable hereunder to the
Lenders (or any Transferee) or the Administrative Agent, (i) the sum payable
shall be increased by the amount necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) such Lender (or Transferee) or the Administrative Agent (as the
case may be) shall receive an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrowers shall make such deductions
and (iii) the Borrowers shall pay the full amount deducted to the relevant
taxing authority or other Governmental Authority in accordance with applicable
law.
(b) In addition, the Borrowers agree to pay any current or future
stamp or documentary taxes or any other excise or property taxes, charges,
assessments or similar levies that arise from any payment made hereunder or
from the execution, delivery or registration of, or otherwise with respect to,
this Agreement or any other Loan Document (hereinafter referred to as "Other
Taxes").
(c) The Borrowers will indemnify each Lender (or Transferee) and
the Administrative Agent for the full amount of Taxes and Other Taxes paid by
such Lender (or Transferee) or the Administrative Agent, as the case may be,
and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or Other Taxes
were correctly or legally asserted by the relevant taxing authority or other
Governmental Authority. Such indemnification shall be made within thirty (30)
days after the date any Lender (or Transferee) or the Administrative Agent, as
the case may be, makes written demand therefor. If a Lender (or Transferee) or
the Administrative Agent shall become aware that it is entitled to receive a
refund in respect of Taxes or Other Taxes as to which it has been indemnified
by the Borrowers pursuant to this Section, it shall promptly notify the
Borrowers of the availability of such refund and shall, within thirty (30) days
after receipt of a request by the Borrowers, apply for such refund at the
Borrowers' expense. If any Lender (or Transferee) or the Administrative Agent
receives a refund in respect of any Taxes or Other Taxes as to which it has
been indemnified by the Borrowers pursuant to this Section, it shall promptly
notify the Borrowers of such refund and shall, within thirty (30) days after
receipt of a request by the Borrowers (or promptly upon receipt, if the
Borrowers have requested application for such refund pursuant hereto), repay
such refund to the Borrowers (to the extent of amounts that have been paid by
the Borrowers under this Section with respect to such refund plus interest that
is received by the Lender (or Transferee) or the Administrative Agent as part
of the refund), net of all out-of-pocket expenses of such Lender (or
Transferee) or the Administrative Agent and without additional interest
thereon; provided that the Borrowers, upon the request of such Lender (or
Transferee) or the Administrative Agent, agree to return such refund (plus
penalties, interest or other charges) to such Lender (or Transferee) or the
Administrative Agent in the event such Lender (or Transferee) or the
Administrative Agent is required to repay such refund. Nothing contained in
this sub-Section (c) shall require any Lender (or Transferee) or the
Administrative Agent to make available any of its tax returns (or any other
information relating to its taxes that it deems to be confidential).
(d) Within thirty (30) days after the date of any payment of Taxes
or Other Taxes withheld by the Borrowers in respect of any payment to any
Lender (or Transferee) or the Administrative Agent, the Borrowers will furnish
to the Administrative Agent, at its address referred to on the signature pages
hereof, the original or a certified copy of a receipt evidencing payment
thereof.
(e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section
shall survive the payment in full of the principal of and interest on all Loans
made hereunder.
(f) Each Lender (and Transferee) and the Administrative Agent
shall, if not a United States Person (as such term is defined in Section
7701(a)(30) of the Code), on or prior to the Closing Date (in the case of each
Lender listed on the signature pages hereof on the Closing Date) or on or prior
to the date of the Assignment and Acceptance pursuant to which it becomes a
Lender (in the case of each other Lender), deliver to the Borrowers and the
Administrative Agent such certificates, documents and other evidence, as
required by the Code or Treasury Regulations issued pursuant thereto, including
two original copies of (A) Internal Revenue Service Form W-9 (unless such
Lender (or Transferee) or the Administrative Agent is an "exempt recipient" as
defined in Treasury Regulations Section 1.6049-4(c) for which no withholding is
required) and two original copies of (B) Internal Revenue Service Forms 1001,
4224, W-8BEN or W-8ECI and any other certificate or statement of exemption
required by Treasury Regulation Section 1.1441-1, 1.1441-4 or 1.1441-6(c) or
any subsequent version thereof or successors thereto, properly completed and
duly executed by such Lender (or Transferee) or the Administrative Agent to
establish that such payment is (i) not subject to United States Federal
withholding tax under the Code because such payment is effectively connected
with the conduct by such Lender (or Transferee) or the Administrative Agent of
a trade or business in the United States or (ii) totally exempt from United
States Federal withholding tax or subject to a reduced rate of such tax under a
provision of an applicable tax treaty. Unless the Borrowers and the
Administrative Agent have received forms or other documents satisfactory to
them indicating that such payments hereunder are not subject to United States
Federal withholding tax or are subject to such tax at a rate reduced by an
applicable tax treaty, the Borrowers or the Administrative Agent shall withhold
taxes from such payments at the applicable statutory rate.
(g) The Borrowers shall not be required to pay any additional
amounts to any Lender (or Transferee) or the Administrative Agent in respect of
United States Federal withholding tax pursuant to sub- Section(a) above if the
obligation to pay such additional amounts would not have arisen but for a
failure by such Lender (or Transferee) or the Administrative Agent to comply
with the provisions of sub- Section(f) above.
(h) Any Lender (or Transferee) or the Administrative Agent claiming
any additional amounts payable pursuant to this Section 2.18 shall use
reasonable efforts (consistent with legal and regulatory restrictions) to file
any certificate or document requested by the Borrowers or to change the
jurisdiction of its applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any such additional
amounts that may thereafter accrue and would not, in the sole determination of
such Lender (or Transferee) or the Administrative Agent, be otherwise
materially disadvantageous to such Lender (or Transferee) or the Administrative
Agent.
SECTION 2.19 Certain Fees. The Borrowers shall pay to the Administrative
Agent, for the respective accounts of the Administrative Agent and the Lenders,
the fees set forth in that certain fee letter dated September 20, 2004 among
the Administrative Agent, X.X. Xxxxxx Securities Inc. and the Borrowers at the
times set forth therein. The Administrative Agent shall be entitled, after
consultation with the Borrowers, to change certain of the pricing and terms of
this Agreement if syndication has not been completed and if the Administrative
Agent determines that such changes are advisable to insure a successful
syndication.
SECTION 2.20 Commitment Fee. The Borrowers shall pay to the Lenders a
commitment fee (the "Commitment Fee") for the period commencing on the date the
Commitment Letter was executed to the Termination Date or the earlier date of
termination of the Commitment calculated (on the basis of the actual number of
days elapsed over a year of 360 days) at a rate equal to the Commitment Fee
Percentage on the average daily Unused Total Commitment during the preceding
quarter. The issuance of Letters of Credit shall be treated as usage of the
Commitment. Such Commitment Fee, to the extent then accrued, shall be payable
(x) monthly, in arrears, three (3) Business Days after the last calendar day of
each month, (y) on the Termination Date and (z) as provided in Section 2.10
hereof, upon any reduction or termination in whole or in part of the Total
Commitment.
SECTION 2.21 Letter of Credit Fees. The Borrowers shall pay with respect
to each Letter of Credit (i) to the Administrative Agent on behalf of the
Lenders a fee calculated (on the basis of the actual number of days elapsed
over a year of 360 days) at a rate equal to 2.75% per annum on the undrawn
stated amount thereof, and (ii) to the Fronting Bank such Fronting Bank's
customary fees for issuance, amendments and processing referred to in Section
2.3. In addition, the Borrowers agree to pay each Fronting Bank for its account
a fronting fee in respect of each Letter of Credit issued by such Fronting
Bank, for the period from and including the date of issuance of such Letter of
Credit to and including the date of termination of such Letter of Credit,
computed at the rate set forth in the fee letter referenced in Section 2.19
above, or, if the Fronting Bank is a bank other than JPMCB, as separately
agreed by the Borrowers and such Fronting Bank, and payable at times to be
determined by such Fronting Bank, the Borrowers and the Administrative Agent.
Accrued fees described in clause (i) of the first sentence of this paragraph in
respect of each Letter of Credit shall be due and payable monthly in arrears
three (3) Business Days after the last calendar day of each month and on the
Termination Date, or such earlier date as the Total Commitment is terminated.
Accrued fees described in clause (ii) of the first sentence of this paragraph
in respect of each Letter of Credit shall be payable at times to be determined
by the Fronting Bank, the Borrowers and the Administrative Agent.
SECTION 2.22 Nature of Fees. All Fees shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for the respective
accounts of the Administrative Agent and the Lenders, as provided herein and in
the letter described in Section 2.19. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.23 Priority and Liens.
(a) Each of the Borrowers hereby covenants, represents and warrants
that, upon entry of the Final Order, the Obligations of the Borrowers hereunder
and under the Loan Documents and in respect of Indebtedness permitted by
Section 6.3(v): (i) pursuant to Section 364(c)(1) of the Bankruptcy Code, shall
at all times constitute an allowed Superpriority Claim; (ii) pursuant to
Section 364(c)(2) of the Bankruptcy Code, shall at all times be secured by a
perfected first priority Lien on all unencumbered property of the Borrowers and
on all cash maintained in the Letter of Credit Account and any direct
investments of the funds contained therein, provided that following the
Termination Date, amounts in the Letter of Credit Account shall not be subject
to the Carve-Out; (iii) pursuant to Section 364(c)(3) of the Bankruptcy Code,
shall be secured by a perfected Lien upon all property of the Borrowers that is
subject to valid and perfected Liens in existence on the Filing Date or that is
subject to valid Liens in existence on the Filing Date that are perfected
subsequent to the Filing Date as permitted by Section 546(b) of the Bankruptcy
Code; and in addition, (iv) pursuant to Section 364(d)(1) of the Bankruptcy
Code, be secured by a perfected first priority, senior priming Lien on all of
the property of the Borrowers (including, without limitation, inventory,
receivables, rights under license agreements, and property, plant and
equipment) that is subject to the existing liens which secure (x) the
obligations of the Parent Borrower and certain of the Subsidiary Borrowers
under or in connection with the Pre-Petition Credit Agreement, and (y) other
obligations or indebtedness of the Borrowers pursuant to other agreements in an
aggregate amount in excess of $2,500,000 (collectively, the "Primed Liens"),
which Primed Liens shall be primed by and made subject and subordinate to the
perfected first priority senior Liens to be granted to the Administrative
Agent, which senior priming Liens in favor of the Administrative Agent shall
also prime any Liens granted after the commencement of the Cases to provide
adequate protection Liens in respect of any of the Primed Liens but shall not
prime Liens, if any, to the extent such Liens secure obligations (other than
obligations under the Pre-Petition Credit Agreement) in an aggregate amount
less than or equal to $2,500,000; subject in each case only to (x) in the event
of the occurrence and during the continuance of an Event of Default or an event
that would constitute an Event of Default with the giving of notice or lapse of
time or both (a "Default"), the payment of allowed and unpaid professional fees
and disbursements incurred by the Borrowers and any statutory committees
appointed in the Cases in an aggregate amount not in excess of $3,000,000 (plus
the amount set forth in the most recent Borrowing Base Certificate delivered by
the Borrowers to the Administrative Agent of then unpaid professional fees and
expenses incurred prior to the occurrence of a Default or an Event of Default
to the extent that such unpaid fees and expenses are subsequently allowed by
the Bankruptcy Court), and (y) the payment of fees pursuant to 28 U.S.C. ss.
1930 and to the Clerk of the Bankruptcy Court (collectively, the "Carve-Out"),
provided that no portion of the Carve-Out shall be utilized for the payment of
professional fees and disbursements incurred in connection with any challenge
to the amount, extent, priority, validity, perfection or enforcement of the
Indebtedness of the Borrowers owed with respect to the parties primed by the
priming Liens or to the collateral securing such Indebtedness or any other
action against such parties. Amounts in the Letter of Credit Account shall not
be subject to the Carve-Out. By execution hereof, the Borrowers hereby consent
to the priming Liens referenced in clause (iv) above. Notwithstanding the
foregoing, so long as no Default or Event of Default shall have occurred and be
continuing, the Borrowers shall be permitted to pay compensation and
reimbursement of expenses allowed and payable under 11 U.S.C. xx.xx. 328, 330
and 331, as the same may be due and payable, and any compensation and expenses
previously paid, or accrued but unpaid, prior to the occurrence of such Default
or Event of Default shall not reduce the Carve-Out.
(b) Subject to the priorities set forth in subsection (a) above and
to the Carve-Out, as to all real property the title to which is held by a
Borrower, or the possession of which is held by a Borrower pursuant to
leasehold interest, the Parent Borrower and each of the Subsidiary Borrowers
hereby assign and convey as security, grant a security interest in,
hypothecate, mortgage, pledge and set over unto the Administrative Agent on
behalf of the Lenders all of the right, title and interest of the Borrowers, in
all of such owned real property and in all such leasehold interests, together
in each case with all of the right, title and interest of the Borrowers in and
to all buildings, improvements, and fixtures related thereto, any lease or
sublease thereof, all general intangibles relating thereto and all proceeds
thereof. The Parent Borrower and each of the Subsidiary Borrowers acknowledge
that, pursuant to the Interim Order (or the Final Order, as applicable), the
Liens in favor of the Administrative Agent on behalf of the Lenders in all of
such real property and leasehold instruments of the Borrowers shall be
perfected without the recordation of any instruments of mortgage or assignment.
The Parent Borrower and each of the Subsidiary Borrowers further agree that,
upon the request of the Administrative Agent, in the exercise of its business
judgment, the Parent Borrower and each of the Subsidiary Borrowers shall enter
into separate fee and leasehold mortgages in recordable form with respect to
such properties on terms satisfactory to the Administrative Agent.
(c) To the extent any Borrower makes aggregate payments to the
Lenders in excess of the aggregate amount of all Loans received by such
Borrower from the Lenders after the commencement of the Cases, then such
Borrower, after the payment in full of all obligations of the Borrowers in
respect of the Commitment and the termination of the Commitment, shall be
entitled to a claim under Section 364(c)(1) of the Bankruptcy Code against each
other Borrower, in such amount as may be determined by the Bankruptcy Court
taking into account the relative benefits received by each such person, and
such claims shall be deemed to be subordinate and junior in all respects to the
superpriority claims of the Lenders and the superpriority claims granted as
adequate protection to the Primed Parties.
SECTION 2.24 Use of Cash Collateral. Notwithstanding anything to
the contrary contained herein, neither the Parent Borrower nor any Subsidiary
Borrower shall be permitted (i) to request a Borrowing under Section 2.6 or
request the issuance of a Letter of Credit under Section 2.3 unless the
Bankruptcy Court shall have entered the Interim Order, or (ii) to request a
Borrowing under Section 2.6 unless the Borrowers shall at that time have the
use of all cash collateral subject to the Orders for the purposes described in
Section 3.10.
SECTION 2.25 Right of Set-Off. Subject to the provisions of Section 7.1,
upon the occurrence and during the continuance of any Event of Default, the
Administrative Agent and each Lender is hereby authorized at any time and from
time to time, to the fullest extent permitted by law and without further order
of or application to the Bankruptcy Court, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other Indebtedness at any time owing by the Administrative Agent and
each such Lender to or for the credit or the account of any Borrower against
any and all of the obligations of such Borrower now or hereafter existing under
the Loan Documents, irrespective of whether or not such Lender shall have made
any demand under any Loan Document and although such obligations may not have
been accelerated. Each Lender and the Administrative Agent agrees promptly to
notify the Borrowers after any such set-off and application made by such Lender
or by the Administrative Agent, as the case may be, provided that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of each Lender and the Administrative Agent under this
Section are in addition to other rights and remedies which such Lender and the
Administrative Agent may have upon the occurrence and during the continuance of
any Event of Default.
SECTION 2.26 Security Interest in Letter of Credit Account. Pursuant to
Section 364(c)(2) of the Bankruptcy Code, the Borrowers hereby assign and
pledge to the Administrative Agent, for its benefit and for the ratable benefit
of the Lenders, and hereby grant to the Administrative Agent, for its benefit
and for the ratable benefit of the Lenders, a first priority security interest,
senior to all other Liens, if any, in all of the Borrowers' right, title and
interest in and to the Letter of Credit Account and any direct investment of
the funds contained therein. Cash held in the Letter of Credit Account shall
not be available for use by the Borrowers, whether pursuant to Section 363 of
the Bankruptcy Code or otherwise.
SECTION 2.27 Payment of Obligations. Subject to the provisions of Section
7.1, upon the maturity (whether by acceleration or otherwise) of any of the
Obligations under this Agreement or any of the other Loan Documents of the
Borrowers, the Lenders shall be entitled to immediate payment of such
Obligations without further application to or order of the Bankruptcy Court.
The Parent Borrower and each of the Subsidiary Borrowers shall be jointly and
severally liable for payment of any Obligations under this Agreement or any of
the other Loan Documents.
SECTION 2.28 No Discharge; Survival of Claims. Each of the Borrowers
agrees that (i) its obligations hereunder shall not be discharged by the entry
of an order confirming a Reorganization Plan (and each of the Borrowers,
pursuant to Section 1141(d)(4) of the Bankruptcy Code, hereby waives any such
discharge) and (ii) the Superpriority Claim granted to the Administrative Agent
and the Lenders pursuant to the Order and described in Section 2.23 shall not
be affected in any manner by the entry of an order confirming a Plan of
Reorganization.
SECTION 2.29 Replacement of Certain Lenders. In the event a Lender
("Affected Lender") shall have: (i) failed to fund its Commitment Percentage of
any Loan requested by the Borrowers or to fund its Commitment Percentage of any
unreimbursed payment made by the Fronting Bank, which such Lender is obligated
to fund under the terms of this Agreement and which failure has not been cured,
(ii) requested compensation from the Borrowers under Section 2.15 with respect
to increased costs or capital or under Section 2.18 to recover Taxes, Other
Taxes or other additional costs incurred by such Lender which, in any case, are
not being incurred generally by the other Lenders, or (iii) delivered a notice
pursuant to Section 2.16 claiming that such Lender is unable to extend
Eurodollar Loans to the Borrowers for reasons not generally applicable to the
other Lenders, then, in any case, the Borrowers or the Administrative Agent may
make written demand on such Affected Lender (with a copy to the Administrative
Agent in the case of a demand by the Borrowers and a copy to the Borrowers in
the case of a demand by the Administrative Agent) for the Affected Lender to
assign, and such Affected Lender shall use commercially reasonable efforts to
assign pursuant to one or more duly executed Assignments and Acceptances five
(5) Business Days after the date of such demand, to one or more financial
institutions that comply with the provisions of Section 9.3 which the Borrowers
or the Administrative Agent, as the case may be, shall have engaged for such
purpose ("Replacement Lender"), all of such Affected Lender's rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, its Commitment, all Loans owing to it, all of its
participation interests in existing Letters of Credit, and its obligation to
participate in additional Letters of Credit hereunder) in accordance with
Section 9.3. The Administrative Agent agrees, upon the occurrence of such
events with respect to an Affected Lender and upon the written request of the
Borrowers, to use its reasonable efforts to obtain the Commitments from one or
more financial institutions to act as a Replacement Lender. The Administrative
Agent is authorized to execute one or more of such Assignments and Acceptances
as attorney-in-fact for any Affected Lender failing to execute and deliver the
same within five (5) Business Days after the date of such demand. Further, with
respect to such assignment the Affected Lender shall have concurrently
received, in cash, all amounts due and owing to the Affected Lender hereunder
or under any other Loan Document, including, without limitation, the aggregate
outstanding principal amount of the Loans owed to such Lender, together with
accrued interest thereon through the date of such assignment, amounts payable
under Section 2.15 with respect to such Affected Lender and compensation
payable under Section 2.20 in the event of any replacement of any Affected
Lender under clause (ii) or clause (iii) of this Section 2.29; provided that
upon such Affected Lender's replacement, such Affected Lender shall cease to be
a party hereto but shall continue to be entitled to the benefits of Sections
2.15, 9.5 and 9.6, as well as to any fees accrued for its account hereunder and
not yet paid, and shall continue to be obligated under Section 8.6 with respect
to losses, obligations, liabilities, damages, penalties, actions, judgments,
costs, expenses or disbursements for matters which occurred prior to the date
the Affected Lender is replaced.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to make Loans and issue and/or
participate in Letters of Credit hereunder, the Parent Borrower and each of the
Subsidiary Borrowers, jointly and severally, represent and warrant as follows:
SECTION 3.1 Organization and Authority. Each of the Borrowers (i) is duly
organized, validly existing and in good standing under the law of its
jurisdiction of organization; (ii) is duly qualified to do business and in good
standing in each jurisdiction in which the failure to so qualify would have a
Material Adverse Effect; (iii) subject to the entry by the Bankruptcy Court of
the Interim Order (or the Final Order, as applicable), has the requisite power
and authority to effect the transactions contemplated hereby, and by the other
Loan Documents to which it is a party, and (iv) subject to the entry by the
Bankruptcy Court of the Interim Order (or the Final Order, as applicable), has
all requisite power and authority and the legal right to own and operate its
properties, and to conduct its business as now or currently proposed to be
conducted.
SECTION 3.2 Due Execution. Upon the entry by the Bankruptcy Court of the
Interim Order (or the Final Order, as applicable), the execution, delivery and
performance by each of the Borrowers of each of the Loan Documents to which it
is a party, including, without limitation, the grant and pledge by each of the
Borrowers of the security interests granted by the Security and Pledge
Agreement, (i) are within the respective powers of each of the Borrowers have
been duly authorized by all necessary action, including the consent of
shareholders, partners or members, where required, and do not (A) contravene
the Organizational Documents of any of the Borrowers, (B) violate any law
(including, without limitation, the Securities Exchange Act of 1934) or
regulation (including, without limitation, Regulations T, U or X of the Board),
or any order or decree of any court or Governmental Authority, (C) conflict
with or result in a breach of, or constitute a default under, any indenture,
mortgage or deed of trust entered into after the Filing Date or any lease,
agreement or other instrument entered into after the Filing Date binding on the
Borrowers or any of their respective properties, or (D) result in or require
the creation or imposition of any Lien upon any of the property of any of the
Borrowers other than Liens granted pursuant to this Agreement; and (ii) do not
require the consent, authorization by or approval of or notice to or filing or
registration with any Governmental Authority other than the entry of the
Interim Order (or the Final Order, as applicable). Except for the entry of the
Interim Order (or the Final Order, as applicable) no authorization, approval or
other action by, and no notice to or filing with, any Governmental Authority or
regulatory body is required for the perfection of the security interests or the
exercise by the Administrative Agent or the Lenders of their respective rights
and remedies under the Loan Documents. Upon the entry by the Bankruptcy Court
of the Interim Order (or the Final Order, as applicable), this Agreement shall
have been duly executed and delivered by each of the Borrowers. Upon the entry
by the Bankruptcy Court of the Interim Order (or the Final Order, as
applicable), this Agreement, and each of the other Loan Documents to which the
Borrowers are or will be a party, when delivered hereunder or thereunder, will
be, a legal, valid and binding obligation of each Borrower, enforceable against
the Borrowers in accordance with its terms and the Orders.
SECTION 3.3 Statements Made. The information that has been delivered in
writing by any of the Borrowers to the Administrative Agent or to the
Bankruptcy Court in connection with any Loan Document, and any financial
statement delivered pursuant hereto or thereto (other than to the extent that
any such statements constitute projections), taken as a whole and in light of
the circumstances in which made, contains no untrue statement of a material
fact and does not omit to state a material fact necessary to make such
statements not misleading; and, to the extent that any such information
constitutes projections, such projections were prepared in good faith on the
basis of assumptions, methods, data, tests and information believed by the
Borrowers to be reasonable at the time such projections were furnished. All
representations and warranties, as made or deemed made as of a particular time,
shall survive execution of each of the Loan Documents and the making of each
Loan or issuance of each Letter of Credit, and may be relied upon by the
Administrative Agent and the Lenders as being true and correct as of the date
when made or deemed made until all of the Borrowers' Obligations are fully and
indefeasibly paid.
SECTION 3.4 Financial Statements. The Borrowers have furnished the
Lenders with copies of the audited consolidated financial statements and
schedules of the Borrowers and their Subsidiaries for the fiscal year ended May
31, 2003. Such financial statements present fairly the financial condition and
results of operations of the Borrowers and their Subsidiaries on a consolidated
basis as of such date and for such period; such balance sheets and the notes
thereto disclose all liabilities, direct or contingent, of the Borrowers and
their Subsidiaries as of the dates thereof required to be disclosed by GAAP and
such financial statements were prepared in a manner consistent with GAAP. No
material adverse change in the operations, businesses, properties, assets,
prospects or condition (financial or otherwise) of the Borrowers and their
Subsidiaries, taken as a whole, has occurred since the Filing Date other than
those which customarily occur as a result of events and circumstances following
the commencement of a proceeding under Chapter 11 of the Bankruptcy Code and
the commencement of the Cases.
SECTION 3.5 Ownership. Each of the Persons listed on Schedule 3.5 is a
direct or indirect Subsidiary of the Borrowers and Schedule 3.5 correctly sets
forth the ownership interest of each of the Borrowers in their respective
Subsidiaries, in each case as of the Closing Date. None of the Borrowers owns
any other Subsidiaries, whether directly or indirectly, other than as set forth
on Schedule 3.5.
SECTION 3.6 Liens. There are no Liens of any nature whatsoever on any
assets of any of the Borrowers other than (i) Permitted Liens, and (ii) Liens
in favor of the Administrative Agent and the Lenders. None of the Borrowers is
a party to any contract, agreement, lease or instrument the performance of
which, either unconditionally or upon the happening of an event, will result in
or require the creation of a Lien on any assets of any Borrower or otherwise
result in a violation of this Agreement other than the Liens granted to the
Administrative Agent and the Lenders as provided for in this Agreement.
SECTION 3.7 Compliance with Law.
(a) (i) The operations of the Borrowers and their Subsidiaries
comply in all material respects with all applicable environmental, health and
safety statutes and regulations, including, without limitation, regulations
promulgated under the Resource Conservation and Recovery Act (42 U.S.C. xx.xx.
6901 et seq.); (ii) none of the operations of the Borrowers or their
Subsidiaries is the subject of any Federal or state investigation evaluating
whether any remedial action involving a material expenditure by the Borrowers
is needed to respond to a release of any Hazardous Waste or Hazardous Substance
(as such terms are defined in any applicable state or Federal environmental law
or regulations) into the environment; and (iii) the Borrowers and their
Subsidiaries do not have any material contingent liability in connection with
any release of any Hazardous Waste or Hazardous Substance into the environment.
(b) None of the Borrowers or their Subsidiaries is in violation of
any law, rule or regulation, or in default with respect to any judgment, writ,
injunction or decree of any Governmental Authority the violation of which, or a
default with respect to which, would have a Material Adverse Effect, other than
the Parent Borrower's failure to timely file its Form 10-K for fiscal year 2004
and its Form 10-Q for the first quarter of fiscal year 2005 with the United
States Securities and Exchange Commission.
SECTION 3.8 Insurance. All policies of insurance of any kind or nature
owned by or issued to the Borrowers, including, without limitation, policies of
life, fire, theft, product liability, public liability, property damage, other
casualty, employee fidelity, workers' compensation, employee health and
welfare, title, property and liability insurance, are in full force and effect
and are of a nature and provide such coverage as is customarily carried by
companies of the size and character of the Borrowers.
SECTION 3.9 The Orders. On the date of the making of the initial Loans or
the issuance of the initial Letters of Credit hereunder, whichever first
occurs, the Interim Order will have been entered and will not have been stayed,
amended, vacated, reversed or rescinded except as approved by the
Administrative Agent, in its exclusive discretion. On the date of the making of
any Loan or the issuance of any Letter of Credit, the Interim Order or the
Final Order, as the case may be, shall have been entered and shall not have
been amended, stayed, vacated or rescinded except as approved by the
Administrative Agent, in its exclusive discretion. Upon the maturity (whether
by the acceleration or otherwise) of any of the obligations of the Borrowers
hereunder and under the other Loan Documents, the Lenders shall, subject to the
provisions of Section 7.1, be entitled to immediate payment of such
obligations, and to enforce the remedies provided for hereunder, without
further application to or order by the Bankruptcy Court.
SECTION 3.10 Use of Proceeds. The proceeds of the Loans shall be used in
accordance with Section 2.2, for (i) working capital, Letters of Credit and
Capital Expenditures; (ii) other general corporate purposes of the Borrowers;
(iii) payment of any related transaction costs, fees and expenses; and (iv) the
costs of administration of the Cases. After delivery of the Budget, all such
usage shall be substantially consistent with the Budget. The Letters of Credit
shall be issued in support of obligations of the Borrowers that are acceptable
to the Administrative Agent.
SECTION 3.11 Litigation. There are no unstayed actions, suits or
proceedings pending or, to the best knowledge of the Borrowers, threatened
against or affecting the Parent Borrower or any Subsidiary Borrower or any of
their respective properties, before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, that
are reasonably likely to have a Material Adverse Effect.
SECTION 3.12 Intellectual Property. Set forth on Schedule 3.12 hereto is
a complete and accurate list of all patents, trademarks, trade names, service
marks and copyrights, and all applications therefor and licenses thereof, of
each Borrower, showing as of the date hereof the jurisdiction in which
registered, the registration number, the date of registration and the
expiration date.
SECTION 3.13 Taxes. Except to the extent permitted by Section 5.4 hereof,
each Borrower has filed or caused to be filed all federal, state and other
material tax returns that are required to be filed and has paid all Taxes shown
to be due and payable on said returns or on any assessments made against it or
any of its property and all other Taxes, fees or other charges imposed on it or
any of its property by any Governmental Authority (other than any the amount or
validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves, if any, in conformity with GAAP
have been provided on the books of such Borrower); no material tax Lien has
been filed, and, to the knowledge of the Borrowers, no claim is being asserted,
with respect to any such Tax, fee or other charge.
SECTION 3.14 Investment Company Act; Other Regulations. Neither the
Parent Borrower nor any Subsidiary Borrower is an "investment company", or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended. The Borrowers are not subject to
any organizational or governing document, or any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority that limits its ability to incur Indebtedness, other than the Orders.
SECTION 3.15 ERISA Matters.
(a) The Borrowers and each of their ERISA Affiliates are in
substantial compliance with all applicable provisions and requirements of ERISA
with respect to each Plan, and have substantially performed all their
obligations under each Plan, except to the extent that any non-compliance with
ERISA or any such failure to perform would not result in material liability of
the Borrowers or any of their ERISA Affiliates.
(b) No ERISA Event has occurred which has resulted, or is
reasonably likely to result, in any material liability to the PBGC or to any
other Person.
(c) Except to the extent required under Section 4980B of the Code
and/or Section 601 of ERISA, neither the Parent Borrower nor the Subsidiary
Borrower maintains or contributes to any employee welfare benefit plan (as
defined in Section 3(1) of ERISA) that provides health or welfare benefits
(through the purchase of insurance or otherwise) for any retired or former
employees of the Borrowers, except to the extent that the provision of such
benefits would not have a Material Adverse Effect.
SECTION 4. CONDITIONS OF LENDING
SECTION 4.1 Conditions Precedent to Initial Loan and Initial Letter of
Credit. The obligation of the Lenders to make the initial Loan or the Fronting
Bank to issue the initial Letter of Credit, whichever may occur first, is
subject to the following conditions precedent:
(a) Supporting Documents. The Administrative Agent shall have
received for each of the Borrowers:
(i) a copy of each Organizational Document originally executed and
delivered by each Borrower, and, to the extent applicable, certified as of
a recent date by the applicable Governmental Authority, each dated the
Closing Date or a recent date prior thereto;
(ii) signature and incumbency certificates of the officers of such
Borrower executing the Loan Documents to which it is a party, dated as of
the Closing Date;
(iii) duly adopted resolutions of the board of directors or similar
governing body of each Borrower approving and authorizing the execution,
delivery and performance of this Agreement and the other Loan Documents to
which it is a party or by which it or its assets may be bound as of the
Closing Date, certified as of the Closing Date by its secretary or
assistant secretary as being in full force and effect without modification
or amendment;
(iv) a good standing certificate from the applicable Governmental
Authority of each Borrower's jurisdiction of incorporation, organization
or formation and in each jurisdiction in which it is qualified as a
foreign corporation or other entity to do business, each dated a recent
date prior to the Closing Date; and
(v) such other documents as the Administrative Agent may reasonably
request.
(b) Interim Order. Not later than ten (10) days following the
Filing Date, the Administrative Agent and the Lenders shall have received a
certified copy of an order of the Bankruptcy Court in substantially the form of
Exhibit A or such other form as otherwise agreed by the Administrative Agent
and the Debtors (the "Interim Order") approving the Loan Documents and granting
the Superpriority Claim status and senior priming and other Liens described in
Section 2.23 which Interim Order (i) shall have been entered upon an
application or motion of the Borrowers, in form and substance satisfactory to
the Administrative Agent and on such prior notice to such parties as may be
satisfactory to the Administrative Agent, (ii) shall authorize extensions of
credit in amounts satisfactory to the Administrative Agent, (iii) shall approve
the payment by the Borrowers of all of the Fees set forth in Sections 2.19,
2.20 and 2.21, (iv) shall be in full force and effect, (v) shall not have been
stayed, reversed, modified or amended in any respect, and (vi) shall be entered
with the consent or non-objection of a preponderance (as determined by the
Administrative Agent) of the secured creditors of any of the Borrowers under
the Pre-Petition Credit Agreement, and (vi) if the Interim Order is the subject
of a pending appeal in any respect, neither the making of such Loan nor the
issuance of such Letter of Credit nor the performance by any of the Borrowers
of any of their obligations hereunder or under the Loan Documents or under any
other instrument or agreement referred to herein shall be the subject of a
presently effective stay pending appeal.
(c) Loan Documents. The Agent shall have received this Agreement,
duly executed and delivered by the Administrative Agent, the Parent Borrower,
each Subsidiary Borrower and each Initial Lender and the Parent Borrower and
each Subsidiary Borrower shall have duly executed and delivered to the
Administrative Agent a Security and Pledge Agreement in substantially the form
of Exhibit B (the "Security and Pledge Agreement").
(d) First Day Orders. All of the "first day orders" entered by the
Bankruptcy Court at the time of the commencement of the Cases shall be
reasonably satisfactory in form and substance to the Administrative Agent in
its exclusive discretion.
(e) Opinion of Counsel. The Administrative Agent and the Lenders
shall have received the favorable written opinion of counsel to the Borrowers,
acceptable to the Administrative Agent, substantially in the form of Exhibit D.
(f) Payment of Fees. The Borrowers shall have paid to the
Administrative Agent the then unpaid balance of all accrued and unpaid Fees due
under and pursuant to this Agreement and the letter referred to in Section
2.19.
(g) Corporate and Judicial Proceedings. All corporate and judicial
proceedings and all instruments and agreements in connection with the
transactions among the Borrowers, the Administrative Agent and the Lenders
contemplated by this Agreement shall be satisfactory in form and substance to
the Administrative Agent in its exclusive discretion, and the Administrative
Agent shall have received all information and copies of all documents and
papers, including records of corporate and judicial proceedings, which the
Administrative Agent may have requested in connection therewith, such documents
and papers where appropriate to be certified by proper corporate, governmental
or judicial authorities.
(h) Information. The Administrative Agent shall have received such
information (financial or otherwise) as may be reasonably requested by the
Administrative Agent.
(i) Compliance with Laws. The Borrowers shall have granted the
Administrative Agent and Collateral Agent access to and the right to inspect
all reports, audits and other internal information of the Borrowers relating to
environmental matters and any third party verification of certain matters
relating to compliance with Environmental Laws requested by the Administrative
Agent.
(j) Closing Documents. The Administrative Agent shall have received
all documents required by this Agreement satisfactory in form and substance to
the Administrative Agent in its exclusive discretion.
(k) Lien Searches. The Administrative Agent shall have received
lien searches conducted in the jurisdictions in which the Borrowers are
organized or conduct business, satisfactory to the Administrative Agent (dated
as of a date reasonably satisfactory to the Agent), reflecting the absence of
Liens and encumbrances on the assets of the Borrowers other than Permitted
Liens.
(l) Field Examinations. The Lenders shall have received appraisals
of all or such portions of the Borrowers' assets they may deem appropriate,
which appraisals shall be satisfactory in form and substance to the
Administrative Agent.
SECTION 4.2 Conditions Precedent to Each Loan and Each Letter of
Credit. The obligation of the Lenders to make each Loan and of the Fronting
Bank to issue each Letter of Credit, including the initial Loan and the initial
Letter of Credit, is subject to the following conditions precedent:
(a) Notice. The Administrative Agent shall have received a notice
with respect to each Borrowing or the issuance of each Letter of Credit, as the
case may be, as required by Section 2.
(b) Representations and Warranties. All representations and
warranties contained in this Agreement and the other Loan Documents shall be
true and correct in all material respects on and as of the date of each
Borrowing or the issuance of each Letter of Credit hereunder with the same
effect as if made on and as of such date except to the extent such
representations and warranties expressly relate to an earlier date.
(c) No Default. On the date of each Borrowing or the issuance of
each Letter of Credit hereunder, no Default or Event of Default shall have
occurred and be continuing.
(d) Orders. The Interim Order shall be in full force and effect and
shall not have been stayed, reversed, modified or amended in any respect
without the prior written consent of the Administrative Agent, provided that at
the time of the making of any Loan or the issuance of any Letter of Credit the
aggregate amount of either of which, when added to the sum of the principal
amount of all Loans then outstanding and the Letter of Credit Outstandings,
would exceed the amount authorized by the Interim Order (collectively, the
"Additional Credit"), the Administrative Agent and each of the Lenders shall
have received a certified copy of the order of the Bankruptcy Court approving
continued lending (the "Final Order") in such form as may be agreed by the
Administrative Agent and the Borrowers, which, in any event, shall have been
entered by the Bankruptcy Court no later than thirty-five (35) days after the
entry of the Interim Order, and at the time of the extension of any Additional
Credit the Final Order shall be in full force and effect, and shall not have
been stayed, reversed, modified or amended in any respect without the prior
written consent of the Administrative Agent; and, if either the Interim Order
or the Final Order is the subject of a pending appeal in any respect, neither
the making of the Loans nor the issuance of any Letter of Credit nor the
performance by any of the Borrowers of any of their obligations under any of
the Loan Documents or under any other instrument or agreement referred to
herein shall be the subject of a presently effective stay pending appeal.
(e) Payment of Fees. The Borrowers shall have paid to the
Administrative Agent the then unpaid balance of all accrued and unpaid Fees
then due and payable under and pursuant to this Agreement and the letter
referred to in Section 2.19.
(f) Borrowing Base. If as a result of such extension of credit,
usage of the Total Commitment would exceed $100,000,000, and in any event no
later than the expiration of the Interim Period, the Borrowers, the
Administrative Agent and the Super-majority Lenders shall have entered into an
Amendment to this Agreement setting forth the Administrative Agent's
determination of the components of the Borrowing Base, and such Amendment shall
be effective.
(g) Borrowing Base Certificate. Commencing with the expiration of
the Interim Period, the Administrative Agent shall have received a Borrowing
Base Certificate in accordance with Section 5.8 dated no more than seven (7)
days prior to each Borrowing or the issuance of each Letter of Credit, which
Borrowing Base Certificate shall include supporting schedules as required by
the Administrative Agent.
(h) Budget. If as a result of such extension of credit, usage of
the Total Commitment would exceed $150,000,000, and in any event no later than
January 20, 2005, the Borrowers shall have delivered, and the Administrative
Agent and Xxxxxxxx Xxxxxx & Company or such other financial advisor as may be
acceptable to the Administrative Agent, shall have accepted, the Budget in
accordance with Section 5.1(f).
(i) Usage. From and after the Borrowers' delivery and the
Administrative Agent's acceptance of the Forecast and until such time as the
Administrative Agent shall have accepted the Budget, the uses of such Borrowing
or such Letter of Credit shall be substantially consistent with such Forecast.
Thereafter, from and after Borrowers' delivery and the Administrative Agent's
acceptance of the Budget, the uses of such Borrowing or such Letter of Credit
shall be substantially consistent with the Budget, as updated from time to
time.
(j) Other Conditions. Such other conditions as may be mutually
agreed upon by the Administrative Agent and the Borrowers.
Each Borrowing shall be deemed to constitute a representation and
warranty by the Borrowers on the date thereof that the conditions specified
above have been satisfied or waived.
SECTION 5. AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.3(b)), or any amount shall remain outstanding or
unpaid under this Agreement, each of the Borrowers and their respective
Subsidiaries agree that, unless the Required Lenders shall otherwise consent in
writing:
SECTION 5.1 Financial Statements, Reports, etc. The Borrowers and the
Subsidiaries will deliver to the Administrative Agent and each of the Lenders:
(a) within ninety (90) days after the end of each fiscal year,
consolidated balance sheets and related statements of income, stockholders'
equity, and cash flows, showing the financial condition of the Borrowers and
their Subsidiaries as of the close of such fiscal year and the results of their
respective operations during such year, the consolidated statements to be
audited for the Borrowers by their current independent auditors or other
independent public accountants of recognized national standing and accompanied
by an opinion of such accountants (which shall not be qualified other than with
respect to the Cases or a going concern qualification) and to be certified by a
Financial Officer of each of the Borrowers to the effect that such consolidated
financial statements fairly present the financial condition and results of
operations of the Borrowers on a consolidated basis in accordance with GAAP;
(b) commencing with the financial statements for the Borrowers'
fiscal quarter ending November 13, 2004, which shall be delivered to the
Administrative Agent and each of the Lenders not later than December 28, 2004,
and thereafter within forty-five (45) days after the end of each of the first
three fiscal quarters of each fiscal year of the Borrowers, and within ninety
(90) days after the end of the fourth fiscal quarter of each fiscal year,
consolidated balance sheets and related statements of income, stockholders'
equity and cash flows, showing the financial condition of the Borrowers and
their Subsidiaries on a consolidated basis, in each case as of the close of
such fiscal quarter and the results of their operations during such fiscal
quarter and the then elapsed portion of the fiscal year, each certified by a
Financial Officer of each of the Borrowers as fairly presenting the financial
condition and results of operations of the Borrowers on a consolidated basis in
accordance with GAAP, subject to normal year-end audit adjustments;
(c) concurrently with any delivery of financial statements under
(a) or (b) above as applicable, (i) a certificate of a Financial Officer of
each of the Borrowers (A) certifying that no Event of Default or event which
upon notice or lapse of time or both would constitute an Event of Default has
occurred, or, if such an Event of Default or event has occurred, specifying the
nature and extent thereof and any corrective action taken or proposed to be
taken with respect thereto and (B) setting forth computations in reasonable
detail satisfactory to the Administrative Agent demonstrating compliance with
the provisions of Sections 6.3, 6.4, 6.5 and 6.10 and (ii) a certificate of
such accountants accompanying the audited consolidated financial statements
delivered under (a) above certifying that, in the course of the regular audit
of the business of the Borrowers and their Subsidiaries, such accountants have
obtained no knowledge that an Event of Default has occurred and is continuing,
or if, in the opinion of such accountants, an Event of Default has occurred and
is continuing, specifying the nature thereof and all relevant facts with
respect thereto;
(d) commencing with monthly financial statements for the Borrowers'
fiscal month ending September 18, 2004, which shall be delivered to the
Administrative Agent and the Lenders as soon as possible, and in any event no
later than November 22, 2004, and thereafter within forty-five (45) days after
the end of each fiscal month, unaudited monthly consolidated balance sheets and
related statements of income and cash flows of the Borrowers and their
Subsidiaries, in form and substance satisfactory to the Administrative Agent
and showing the results of the Borrowers operations during such fiscal month
and the then elapsed portion of the fiscal year;
(e) as soon as possible, and in any event no later than October 22,
2004, a forecast of the sources and uses of cash by the Borrowers on a weekly
basis for the succeeding thirteen (13) calendar weeks, in form and substance
satisfactory to the Administrative Agent and Xxxxxxxx Xxxxxx & Company or such
other financial advisor as may be acceptable to the Administrative Agent (as
updated from time to time pursuant to Section 5.1(f), the "Forecast");
(f) commencing on the date which is two (2) weeks after the
Borrowers' delivery of the Forecast pursuant to Section 5.1(e), and every two
(2) weeks thereafter, an update of the Forecast for the then succeeding
thirteen (13) calendar weeks, in form and substance satisfactory to the
Administrative Agent and Xxxxxxxx Xxxxxx & Company or such other financial
advisor as may be acceptable to the Administrative Agent;
(g) as soon as possible, and in any event no later than January 20,
2005, a projected operating budget (which shall include income statements,
balance sheets and cash flow statements) detailing, on a monthly and quarterly
basis, the Borrowers' anticipated cash receipts and disbursements for the
period ending on the Maturity Date, and setting forth the anticipated uses of
the Commitment, in form and substance satisfactory to the Administrative Agent
and Xxxxxxxx Xxxxxx & Company, or such other financial advisor as may be
acceptable to the Administrative Agent (as updated from time to time pursuant
to Section 5.1(h), the "Budget");
(h) commencing as soon as possible, and in any event not later than
January 20, 2005, within forty-five (45) days after the end of each fiscal
month, a summary of the results of the Borrowers' business operations for the
preceding month as compared to the corresponding period in the Budget,
including a discussion of significant variances, which summary shall describe
results on the basis of the Borrowers and their respective Subsidiaries on a
consolidated basis;
(i) commencing with an update for the Borrowers' fiscal quarter
ending March 5, 2005, which shall be delivered to the Administrative Agent and
the Lenders no later than April 19, 2005, and thereafter within forty-five (45)
days after the end of each of the first three fiscal quarters of each fiscal
year of the Borrowers, and within sixty (60) days from the end of the last
fiscal quarter of each fiscal year of the Borrowers, an update of the Budget
satisfactory in form and substance to the Administrative Agent and Xxxxxxxx
Xxxxxx & Company or such other financial advisor as may be acceptable to
Administrative Agent, and be available to discuss such updated Budget with the
Administrative Agent upon the Administrative Agent's reasonable request;
(j) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials filed by
it with the Securities and Exchange Commission, or any governmental authority
succeeding to any of or all the functions of said commission, or with any
national securities exchange, as the case may be;
(k) as soon as available and in any event (A) within thirty (30)
days after any Borrower, any or any of their ERISA Affiliates knows or has
reason to know that any Termination Event described in clause (i) of the
definition of Termination Event with respect to any Single Employer Plan of any
of the Borrowers or such ERISA Affiliate has occurred and (B) within ten (10)
days after any of the Borrowers or any of their ERISA Affiliates knows or has
reason to know that any other Termination Event with respect to any such Plan
has occurred, a statement of a Financial Officer of such Borrower describing
such Termination Event and the action, if any, which such Borrower or such
ERISA Affiliate proposes to take with respect thereto;
(l) promptly and in any event within ten (10) days after receipt
thereof by any of the Borrowers or any of their ERISA Affiliates from the PBGC
copies of each notice received by such Borrower or any such ERISA Affiliate of
the PBGC's intention to terminate any Single Employer Plan of such Borrower or
such ERISA Affiliate or to have a trustee appointed to administer any such
Plan;
(m) if requested by the Administrative Agent, promptly and in any
event within thirty (30) days after the filing thereof with the Internal
Revenue Service, copies of each Schedule B (Actuarial Information) to the
annual report (Form 5500 Series) with respect to each Single Employer Plan of
any of the Borrowers or any of their ERISA Affiliates;
(n) within ten (10) days after notice is given or required to be
given to the PBGC under Section 302(f)(4)(A) of ERISA of the failure of any of
the Borrowers or any of their ERISA Affiliates to make timely payments to a
Plan, a copy of any such notice filed and a statement of a Financial Officer of
such Borrower setting forth (A) sufficient information necessary to determine
the amount of the Lien under Section 302(f)(3), (B) the reason for the failure
to make the required payments and (C) the action, if any, which the Borrowers
or any of their ERISA Affiliates proposed to take with respect thereto;
(o) promptly and in any event within ten (10) days after receipt
thereof by any of the Borrowers or any ERISA Affiliate from a Multiemployer
Plan sponsor, a copy of each notice received by such Borrower or any ERISA
Affiliate concerning (A) the imposition of Withdrawal Liability by a
Multiemployer Plan, (B) the determination that a Multiemployer Plan is, or is
expected to be, in reorganization within the meaning of Title IV of ERISA, (C)
the termination of a Multiemployer Plan within the meaning of Title IV of
ERISA, or (D) the amount of liability incurred, or which may be incurred, by
the Borrowers or any ERISA Affiliate in connection with any event described in
clause (A), (B) or (C) above;
(p) as soon as available, the Borrowers' consolidated balance
sheets and related statements of income; stockholders' equity and cash flows,
showing the financial condition of the Borrowers and their respective
Subsidiaries on a consolidated basis as of the close of the fiscal year ending
on May 29, 2004 and the fiscal quarter ending August 21, 2004, in each case,
certified by a Financial Officer of each of the Borrowers as fairly presenting
the financial condition and results of operations of the Borrowers and their
respective Subsidiaries on a consolidated basis in accordance with GAAP,
subject, in the case of the interim financial statements, to normal year-end
audit adjustments; and
(q) promptly, from time to time, such other information (including,
without limitation, projections) regarding the operations, business affairs and
financial condition of any Borrower, or compliance with the terms of any
material loan or financing agreements as the Administrative Agent, at the
request of any Lender, may reasonably request; and
(r) promptly after the same is available, copies of all pleadings,
motions, applications, judicial information, financial information and other
documents filed by or on behalf of any of the Borrowers with the Bankruptcy
Court in the Cases, providing copies of same to counsel for the Administrative
Agent.
SECTION 5.2 Existence. The Borrowers will preserve and maintain in full
force and effect all governmental rights, privileges, qualifications, permits,
licenses and franchises necessary or desirable in the normal conduct of its
businesses except (i) (A) if in the reasonable business judgment of such
Borrower it is in its best economic interest not to preserve and maintain such
rights, privileges, qualifications, permits, licenses and franchises, and (B)
such failure to preserve the same could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect, and (ii) as otherwise permitted in
connection with sales of assets permitted by Section 6.11.
SECTION 5.3 Insurance. The Borrowers will: (a) keep their insurable
properties insured at all times, against such risks, including fire and other
risks insured against by extended coverage, as is customary with companies of
the same or similar size in the same or similar businesses; and maintain in
full force and effect public liability insurance against claims for personal
injury or death or property damage occurring upon, in, about or in connection
with the use of any properties owned, occupied or controlled by any Borrower in
such amounts and with such deductibles as are customary with companies of the
same or similar size in the same or similar businesses and in the same
geographic area, with financially sound and responsible insurance companies;
and (b) maintain such other insurance or self insurance as may be required by
law, with financially sound and responsible insurance companies.
SECTION 5.4 Obligations and Taxes. Each Borrower will pay all its
material obligations arising after the Filing Date promptly and in accordance
with their terms and pay and discharge promptly all material taxes, assessments
and governmental charges or levies imposed upon it or upon its income or
profits or in respect of its property arising after the Filing Date, before the
same shall become in default, as well as all material lawful claims for labor,
materials and supplies or otherwise arising after the Filing Date which, if
unpaid, would become a Lien or charge upon such properties or any part thereof;
provided, however, that no Borrower shall be required to pay and discharge or
to cause to be paid and discharged any such tax, assessment, charge, levy or
claim so long as the validity or amount thereof shall be contested in good
faith by appropriate proceedings (if the Borrowers shall have set aside on
their books adequate reserves therefor).
SECTION 5.5 Notice of Event of Default, etc. The Borrowers will promptly
give to the Administrative Agent notice in writing of:
(a) any Default or Event of Default; and
(b) any litigation, proceedings or material investigations which
may exist at any time between any Borrower and any Governmental Authority.
SECTION 5.6 Access to Books and Records.
(a) The Borrowers and the Subsidiaries will maintain or cause to be
maintained at all times true and complete books and records in accordance with
GAAP of the financial operations of the Borrowers and their respective
Subsidiaries; and provide the Administrative Agent and its representatives
access to all such books and records during regular business hours, in order
that the Administrative Agent may examine and make abstracts from such books,
accounts, records and other papers for the purpose of verifying the accuracy of
the various reports delivered by the Borrowers to the Administrative Agent or
the Lenders pursuant to this Agreement or for otherwise ascertaining compliance
with this Agreement. The Borrowers will permit (and will cause their
Subsidiaries to permit) any representatives designated by the Administrative
Agent to discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times and as often as
reasonably requested.
(b) The Borrowers will permit any representatives designated by the
Administrative Agent (including any consultants, accountants, lawyers and
appraisers retained by the Administrative Agent) to conduct evaluations and
appraisals of the Borrowers' computation of the Borrowing Base and the assets
included in the Borrowing Base and such other assets and properties of the
Borrowers or their Subsidiaries as the Administrative Agent or Required Lenders
may require, all at such reasonable times and as often as reasonably requested.
The Borrowers shall pay the reasonable fees (including reasonable and customary
internally allocated fees of employees of the Administrative Agent as to which
invoices have been furnished) and expenses of any such representatives retained
by the Administrative Agent as to which invoices have been furnished to conduct
any such evaluation or appraisal, including the reasonable fees and expenses
associated with collateral monitoring services performed by the IB ABL
Portfolio Management Group of the Administrative Agent. To the extent required
by the Administrative Agent as a result of any such evaluation, appraisal or
monitoring, the Borrowers also agree to modify or adjust the computation of the
Borrowing Base (which may include maintaining additional reserves, modifying
the advance rates or modifying the eligibility criteria for the components of
the Borrowing Base).
(c) In the event that historical accounting practices, systems or
reserves relating to the components of the Borrowing Base are modified in a
manner that is adverse to the Lenders in any material respect, the Borrowers
will agree to maintain such additional reserves (for purposes of computing the
Borrowing Base) in respect to the components of the Borrowing Base and make
such other adjustments to its parameters for including the components of the
Borrowing Base as the Administrative Agent shall reasonably require based upon
such modifications.
(d) The Borrowers will grant the Administrative Agent and the
Collateral Agent access to and the right to inspect all reports, audits and
other internal information of the Borrowers relating to environmental matters
upon reasonable notice, and obtain any third party verification of matters
relating to compliance with environmental laws and regulations requested by the
Administrative Agent at any time and from time to time.
SECTION 5.7 Maintenance of Concentration Account. Within thirty (30)
days after the Closing Date, and at all times thereafter, the Borrowers
will maintain with the Administrative Agent an account or accounts to be used
by the Borrowers as their principal domestic concentration or sweep account(s)
into which shall be deposited the available balances from the Borrowers'
operating accounts at the end of each Business Day, net of disbursements paid
in the ordinary course of business during such Business Day.
SECTION 5.8 Borrowing Base Certificate. Commencing upon the end of the
Interim Period, furnish to the Administrative Agent, no later than (i) seven
(7) days after each of the weeks ended, a completed Borrowing Base Certificate
as of the last day of the immediately preceding one week period, (ii) twenty
(20) days following the immediately preceding fiscal month ended, a completed
Borrowing Base Certificate showing the Borrowing Base as of the close of
business on the last day of such fiscal month, and (iii) if requested by the
Administrative Agent, at any other time when the Administrative Agent
reasonably believes that the then existing Borrowing Base Certificate is
materially inaccurate, as soon as reasonably available but in no event later
than five (5) Business Days after such request, a completed Borrowing Base
Certificate showing the Borrowing Base as of the date so requested, in each
case with supporting documentation and additional reports with respect to the
Borrowing Base as the Administrative Agent may reasonably request. The Real
Property Component of the Borrowing Base shall be updated (i) from time to time
upon receipt of periodic valuation updates received from the Administrative
Agent's asset valuation experts, (ii) concurrent with the sale of any assets
constituting part of the Real Property Component, (iii) in the event such
assets are idled for any reason other than routine maintenance or repairs for a
period in excess of ten (10) consecutive days, (iv) the value of such assets is
otherwise impaired, in the Administrative Agent's exclusive discretion, or (v)
following any of the events described in clauses (ii) or (iii) above,
concurrent with any agreement by the Administrative Agent (in the
Administrative Agent's discretion) to permit the Borrowers to add other
property, plant or equipment to the Real Property Component following receipt
of appraisals of such assets which are satisfactory to the Administrative
Agent. The components of the Borrowing Base consisting of Inventory shall be
updated monthly as of the close of business on the last day of each fiscal
month of the Borrowers.
SECTION 5.9 Compliance with Laws. Comply with requirements of all
applicable laws, rules, regulations and orders of any Governmental Authority
(including all Pure Food and Drug Laws), except to the extent that failure to
comply herewith could not, in the aggregate, have a Material Adverse Effect.
SECTION 5.10 Environmental Laws.
(a) Exercise all due diligence in order to comply and cause (i) all
tenants under any leases or occupancy agreements affecting any portion of the
Facilities and (ii) all other Persons on or occupying such property, to comply
with all Environmental Laws.
(b) (i) Promptly take any and all necessary remedial action in
connection with the presence, storage, use, disposal, transportation or release
of any Hazardous Waste or Hazardous Substance on or under any Facility required
to comply with all applicable Environmental Laws and Governmental
Authorizations unless the failure to so comply could not reasonably be expected
to have a Material Adverse Effect and (ii) in the event the Borrowers take any
remedial action with respect to any Hazardous Waste or Hazardous Substance on
or under any Facility, conduct and complete such remedial action in material
compliance with all applicable Environmental Laws and in accordance with the
policies, orders and directives of any applicable Governmental Authorities
except when, and only to the extent that, the Borrowers' liability for such
presence, storage, use, disposal, transportation or release of any such
Hazardous Waste or Hazardous Substance is being contested in good faith by the
Borrowers.
SECTION 5.11 Restructuring Advisors. Continue to retain Xxxxxxx &
Marsal or such other third party financial restructuring advisors who shall be
hired by the Borrowers and who shall be reasonably satisfactory to the
Administrative Agent.
SECTION 6. NEGATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in
each case pursuant to Section 2.3(b)) or any amount shall remain outstanding
or unpaid under this Agreement, unless the Required Lenders shall otherwise
consent in writing:
SECTION 6.1 Liens. Each of the Borrowers will not (and will not apply to
the Bankruptcy Court for authority to), incur, create, assume or suffer to
exist any Lien or encumbrance on any asset of the Borrowers now owned or
hereafter acquired by any Borrower other than Permitted Liens.
SECTION 6.2 Merger, etc. Each of the Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), consolidate or merge with or
into another Person.
SECTION 6.3 Indebtedness. Each of the Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), contract, create, incur,
assume or suffer to exist any Indebtedness, except for (i) Indebtedness under
this Agreement; (ii) Indebtedness incurred prior to the Filing Date (including
existing Capitalized Leases) of the Borrowers, including the Indebtedness
listed on Schedule 6.3; (iii) Indebtedness incurred subsequent to the Filing
Date secured by purchase money Liens (exclusive of Capitalized Leases) in an
aggregate amount not in excess of $1,000,000 to the extent permitted by Section
6.4; (iv) Indebtedness allowed under Sections 6.6 and 6.10 (without
duplication); (v) Indebtedness owed to (x) JPMCB or any of its banking
affiliates or (y) during the period commencing on the date hereof and ending on
the earlier of (A) the Prepayment Date or (B) the date on which the Final Order
is entered, and thereafter with respect to Indebtedness owed to Bank of
America, N.A., as long as Bank of America, N.A. is a Lender, and with respect
to Indebtedness owed to United Missouri Bank, as long as United Missouri Bank
is a Lender, or any of their respective banking Affiliates, in respect of any
overdrafts and related liabilities arising from treasury, depository and cash
management services or in connection with any automated clearing house
transfers of funds; (vi) other secured or unsecured Indebtedness incurred
subsequent to the Filing Date in an aggregate amount not to exceed $1,000,000;
and (vii) obligations in respect of commodities option contracts allowed under
Section 6.15 of this Agreement.
SECTION 6.4 Capital Expenditures. Each of the Borrowers will not (and
will not apply to the Bankruptcy Court for authority to), and will cause each
of their respective Subsidiaries not to, make Capital Expenditures during any
fiscal quarter, commencing with the fiscal quarter beginning November 14, 2004,
in an aggregate amount in excess of an amount to be satisfactory to the
Administrative Agent and which shall be based upon the Budget.
SECTION 6.5 EBITDA. As of the end of each fiscal month of the Borrowers,
commencing with the fiscal month beginning November 14, 2004, the Borrowers
will not permit cumulative Consolidated EBITDA for each fiscal period beginning
November 14, 2004 and ending in each case on the last day of each fiscal month
thereafter to be less than an amount to be satisfactory to the Administrative
Agent and which shall be based upon the Budget.
SECTION 6.6 Guarantees and Other Liabilities. Each of the Borrowers will
not (and will not apply to the Bankruptcy Court for authority to), purchase or
repurchase (or agree, contingently or otherwise, so to do) the Indebtedness of,
or assume, guarantee (directly or indirectly or by an instrument having the
effect of assuring another's payment or performance of any obligation or
capability of so doing, or otherwise), endorse or otherwise become liable,
directly or indirectly, for the obligations, stock or dividends of any Person,
except (i) for any guaranty of Indebtedness or other obligations (or otherwise
becoming liable for any of the obligations) of any of the Borrowers in the
ordinary course of business and consistent with the past business practices
with trade vendors if such Indebtedness or the obligations are permitted by
this Agreement, and (ii) by endorsement of negotiable instruments for deposit
or collection in the ordinary course of business.
SECTION 6.7 Chapter 11 Claims. Each of the Borrowers will not (and will
not apply to the Bankruptcy Court for authority to), incur, create, assume,
suffer to exist or permit any other Superpriority Claim which is pari passu
with or senior to the claims of the Administrative Agent and the Lenders
against the Borrowers hereunder, except for the Carve-Out.
SECTION 6.8 Dividends; Capital Stock. Each of the Borrowers will not (and
will not apply to the Bankruptcy Court for authority to), except for
distributions or payments from one Borrower to another Borrower, or from any
Subsidiaries to any Borrower, declare or pay, directly or indirectly, any
dividends or make any other distribution or payment, whether in cash, property,
securities or a combination thereof, with respect to (whether by reduction of
capital or otherwise) any shares of capital stock (or any options, warrants,
rights or other equity securities or agreements relating to any capital stock),
or set apart any sum for the aforesaid purposes on anything other than an
arm's-length basis.
SECTION 6.9 Transactions with Affiliates. Each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), sell or transfer
any property or assets to, or otherwise engage in or permit to exist any other
material transactions with, any of its non-Borrower Affiliates other than (i)
in the ordinary course of the Borrowers' businesses in good faith and at
commercially reasonable prices and on commercially reasonable terms and
conditions not less favorable to the Borrowers than could be obtained on an
arm's-length basis from a non-Affiliate, and (ii) transactions described on
Schedule 6.9.
SECTION 6.10 Investments, Loans and Advances. Each of the Borrowers will
not (and will not apply to the Bankruptcy Court for authority to), purchase,
hold or acquire any capital stock, evidences of Indebtedness or other
securities of, make or permit to exist any loans or advances to, or make or
permit to exist any investment in, any other Person (all of the foregoing,
"Investments"), except for (i) Permitted Investments; (ii) Intercompany
Indebtedness owing from a Borrower to another Borrower incurred in the ordinary
course of business consistent with past practice; (iii) existing Intercompany
Indebtedness listed on Schedule 6.10 and (iv) Investments listed on Schedule
6.10.
SECTION 6.11 Disposition of Assets. Each of the Borrowers will not (and
will not apply to the Bankruptcy Court for authority to), sell or otherwise
dispose of any assets (including, without limitation, the capital stock of any
Subsidiary of the Borrowers) except for (i) sales of Inventory, fixtures and
equipment in the ordinary course of business, and (ii) sales of surplus assets
of the Borrowers no longer used in the Borrowers' business operations.
SECTION 6.12 Nature of Business. Each of the Borrowers will not (and will
not apply to the Bankruptcy Court for authority to), modify or alter in any
material manner the nature and type of its business as conducted at or prior to
the Filing Date or the manner in which such business is conducted (except as
required by the Bankruptcy Code).
SECTION 6.13 Transactions among Borrowers. Each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), except to the
extent existing on the date the Cases were filed and disclosed on Schedule
6.13, permit, place or agree to permit or place any restrictions on the payment
of dividends or other distributions among the Borrowers or their Subsidiaries
or Affiliates or the making of advances or any other cash payments among the
Borrowers or their Subsidiaries or Affiliates.
SECTION 6.14 Right of Subrogation among Borrowers. Each of the Borrowers
will not (and will not apply to the Bankruptcy Court for authority to), assert
any right of subrogation against any other Borrower until all Borrowings and
all Letters of Credit are paid in full and the Total Commitment is terminated.
SECTION 6.15 Derivative Agreements. Other than option contracts designed
to hedge against fluctuations in prices for wheat, corn, oil, fuel and other
commodities used in the Borrowers' business, in each case entered into in the
ordinary course of the Borrowers' business, consistent with past practices and
not for speculative purposes, and for which aggregate expenditures by the
Borrowers during any fiscal year shall not exceed $10,000,000, each of the
Borrowers will not (and will not apply to the Bankruptcy Court for authority
to), enter into any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions.
SECTION 6.16 Reorganization Plan. The Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), file any Reorganization Plan
that does not provide for the repayment in full in cash on the effective date
thereof of all outstanding Obligations.
SECTION 7. EVENTS OF DEFAULT
SECTION 7.1 Events of Default. In the case of the happening of any of the
following events and the continuance thereof beyond the applicable period of
grace (if any) set forth below (each, an "Event of Default"):
(a) any representation or warranty made by any Borrower in this
Agreement or in any Loan Document or in connection with this Agreement or the
credit extensions hereunder or any statement or representation made in any
report, financial statement, certificate or other document furnished by any
Borrower to the Lenders under or in connection with this Agreement, shall prove
to have been false or misleading in any material respect when made or
delivered; or
(b) default shall be made in the payment of any fees or interest on
the Loans, principal of the Loans or other amounts payable by the Borrowers
hereunder (including, without limitation, reimbursement obligations or cash
collateralization in respect of Letters of Credit), when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise; or
(c) default shall be made by any Borrower in the due observance or
performance of any covenants, conditions or agreements contained in Section 6
hereof; or
(d) default shall be made by any Borrower in the due observance or
performance of any covenant, condition or agreement (other than the covenants,
conditions or agreements contained in Section 6 hereof) to be observed or
performed pursuant to the terms of this Agreement or any of the other Loan
Documents and such default shall continue unremedied for more than ten (10)
days; or
(e) any of the Cases shall be dismissed or converted to a case
under Chapter 7 of the Bankruptcy Code or any Borrower shall file a motion or
other pleading seeking the dismissal of any of the Cases under Section 1112 of
the Bankruptcy Code or otherwise; a trustee under Chapter 7 or Chapter 11 of
the Bankruptcy Code, a responsible officer or an examiner with enlarged powers
relating to the operation of the business (powers beyond those set forth in
Section 1106(a)(3) and (4) of the Bankruptcy Code) under Section 1106(b) of the
Bankruptcy Code shall be appointed in any of the Cases and the order appointing
such trustee, responsible officer or examiner shall not be reversed or vacated
within thirty-five (35) days after the entry thereof; an application shall be
filed by any Borrower for the approval of any other Superpriority Claim (other
than the Carve-Out) in any of the Cases which is pari passu with or senior to
the claims of the Administrative Agent and the Lenders against any Borrower
hereunder, or there shall arise or be granted any such pari passu or senior
Superpriority Claim; or the Bankruptcy Court shall enter an order terminating
the use of cash collateral for the purposes described in Section 3.10; or
(f) the Bankruptcy Court shall enter an order or orders granting
relief from the automatic stay applicable under Section 362 of the Bankruptcy
Code to the holder or holders of any security interest to permit foreclosure
(or the granting of a deed in lieu of foreclosure or the like) on any assets of
any of the Borrowers which have a value in excess of $1,000,000 in the
aggregate; or
(g) a Change of Control shall occur; or
(h) from and after the expiration of the Interim Period, the
Borrowers shall fail to deliver a certified Borrowing Base Certificate when due
and such default shall continue unremedied for more than three (3) Business
Days; or
(i) any provision of any Loan Document shall, for any reason, cease
to be valid and binding on any of the Borrowers, or any of the Borrowers shall
so assert in any pleading filed in any court; or
(j) an order of the Bankruptcy Court shall be entered reversing,
amending, supplementing, staying for a period in excess of ten (10) days,
vacating or otherwise modifying either of the Orders; or
(k) any judgment or order as to a post-petition liability or debt
for the payment of money in excess of $1,000,000 shall be rendered against any
of the Borrowers and the enforcement thereof shall not have been stayed (by
court-ordered stay or by consent of the party litigants), it being understood
that Federal Rule of Civil Procedure 62(a) provides for a ten-day stay of
enforcement of money judgments; or
(l) any non-monetary judgment or order with respect to a
post-petition event shall be rendered against any Borrower which does or would
reasonably be expected to (i) cause a material adverse change in the financial
condition, business, prospects, operations or assets of the Borrowers taken as
a whole on a consolidated basis, (ii) have a material adverse effect on the
ability of any of the Borrowers to perform their respective obligations under
any Loan Document, or (iii) have a material adverse effect on the rights and
remedies of the Administrative Agent or any Lender under any Loan Document, and
there shall be any period of ten (10) consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(m) the Borrowers shall make any Pre-Petition Payment (whether by
way of adequate protection or otherwise) of principal or interest or otherwise
on account of any pre-petition Indebtedness or payables other than Pre-Petition
Payments authorized by the Bankruptcy Court in respect of: (i) accrued payroll
and related employee benefit expenses as of the Filing Date, (ii) reclamation
claims in such amounts as determined by the Borrowers and agreed to by the
Administrative Agent; (iii) materialmen's liens and certain other pre-petition
claims permitted by the Administrative Agent and authorized by the Bankruptcy
Court in an aggregate amount not to exceed $500,000, (iv) the payment of
current interest and letter of credit fees (and the payment of all interest and
fees that are accrued and unpaid as of the Filing Date) at the applicable
non-default rates provided for pursuant to the Pre-Petition Credit Agreement,
all as described in the Borrowers' Motion for Interim and Final Orders (I)
Authorizing Debtors to (A) Obtain Postpetition Financing pursuant to 11 U.S.C.
xx.xx. 105, 361, 362, 363, 364(C)(1), 364(C)(2), 364(C)(3) and 364(d)(1), and
(B) Utilize Cash Collateral pursuant to 11 U.S.C. ss. 363, (II) Granting
Adequate Protection to Prepetition Secured Parties pursuant to 11 U.S.C. xx.xx.
361, 362 and 363 and (III) Scheduling Final Hearing pursuant to Fed. R. Bankr.
P. 4001(c), and as authorized by the Orders, and (v) payments in respect of
prepetition claims of taxing authorities in an aggregate amount not to exceed
$3,000,000 as described in the Borrowers' Motion for Order under 11 U.S.C.
xx.xx. 363, 507 and 541 Confirming Authority to Pay Prepetition Sales and Use
Taxes; or
(n) any Termination Event described in clauses (iii) or (iv) of the
definition of such term shall have occurred and shall continue unremedied for
more than ten (10) days and the sum (determined as of the date of occurrence of
such Termination Event) of the Insufficiency of the Plan in respect of which
such Termination Event shall have occurred and be continuing and the
Insufficiency of any and all other Plans with respect to which such a
Termination Event (described in such clauses (iii) or (iv)) shall have occurred
and then exist is equal to or greater than $1,000,000; or
(o) (i) any Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan, (ii) such Borrower or such ERISA
Affiliate does not have reasonable grounds to contest such Withdrawal Liability
and is not in fact contesting such Withdrawal Liability in a timely and
appropriate manner, and (iii) the amount of such Withdrawal Liability specified
in such notice, when aggregated with all other amounts required to be paid to
Multiemployer Plans in connection with Withdrawal Liabilities (determined as of
the date of such notification), exceeds $5,000,000 allocable to post-petition
obligations or requires payments exceeding $1,000,000 per annum in excess of
the annual payments made with respect to such Multiemployer Plans by such
Borrower or such ERISA Affiliate for the plan year immediately preceding the
plan year in which such notification is received; or
(p) any Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate
annual contributions of such Borrower and its ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such Multiemployer
Plans for the plan years that include the date hereof by an amount exceeding
$5,000,000; or
(q) any Borrower or any ERISA Affiliate thereof shall have
committed a failure described in Section 302(f)(1) of ERISA (other than the
failure to make any contribution accrued and unpaid as of the Filing Date) and
the amount determined under Section 302(f)(3) of ERISA is equal to or greater
than $1,000,000; or
(r) it shall be determined (whether by the Bankruptcy Court or by
any other judicial or administrative forum) that any Borrower is liable for the
payment of claims arising out of any failure to comply (or to have complied)
with applicable Environmental Laws the payment of which will have a Material
Adverse Effect and the enforcement thereof shall not have been stayed; or
then, and in every such event and at any time thereafter during the
continuance of such event, and without further order of or application to the
Bankruptcy Court, the Administrative Agent may, and at the request of the
Required Lenders, shall, take one or more of the following actions without
further order of or application to the Court, provided that with respect to
item (iv) below and the enforcement of liens or other remedies with respect
to collateral referred to in item (v) below, the Administrative Agent shall
provide the Borrowers (with a copy to counsel for the Official Creditors'
Committee appointed in any of the Cases and to the United States Trustee for
the Bankruptcy Court's District) with five (5) business days' prior written
notice (the "Default Notice"): (i) terminate forthwith the Total Commitment;
(ii) declare the Loans then outstanding to be forthwith due and payable,
whereupon the principal of the Loans together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Borrowers
accrued hereunder and under any other Loan Document, shall become forthwith
due and payable, without presentment, demand, protest or any other notice of
any kind, all of which are hereby expressly waived by the Borrowers, anything
contained herein or in any other Loan Document to the contrary
notwithstanding; (iii) require the Borrowers upon demand to forthwith deposit
in the Letter of Credit Account cash in an amount which, together with any
amounts then held in the Letter of Credit Account, is equal to the sum of
105% of the then Letter of Credit Outstandings (and to the extent the
Borrowers shall fail to furnish such funds as demanded by the Administrative
Agent, the Administrative Agent shall be authorized to debit the accounts of
the Borrowers maintained with the Administrative Agent in such amount five
(5) Business Days after the giving of the notice referred to above (the
"Default Notice Period")); (iv) set-off amounts in the Letter of Credit
Account or any other accounts maintained with the Administrative Agent or any
other Lender or their affiliates and apply such amounts to the obligations of
the Borrowers hereunder and in the other Loan Documents; and/or (v) exercise
any and all remedies (including, without limitation, with respect to the
Liens in favor of the Administrative Agent and the Lenders) under the Loan
Documents and under applicable law available to the Administrative Agent and
the Lenders.
SECTION 8. THE ADMINISTRATIVE AGENT
SECTION 8.1 Administration by Administrative Agent. The general
administration of the Loan Documents shall be performed by the Administrative
Agent. Each Lender hereby irrevocably authorizes the Administrative Agent, at
its discretion, to take or refrain from taking such actions as agent on its
behalf and to exercise or refrain from exercising such powers under the Loan
Documents as are delegated by the terms hereof or thereof, as appropriate,
together with all powers reasonably incidental thereto (including the release
of Collateral in connection with any transaction that is expressly permitted by
the Loan Documents). The Administrative Agent shall have no duties or
responsibilities except as set forth in this Agreement and the remaining Loan
Documents.
SECTION 8.2 Advances and Payments.
(a) On the date of each Loan, the Administrative Agent shall be
authorized (but not obligated) to advance, for the account of each of the
Lenders, the amount of the Loan to be made by it in accordance with its
Commitment hereunder. Should the Administrative Agent do so, each of the
Lenders agrees forthwith to reimburse the Administrative Agent in immediately
available funds for the amount so advanced on its behalf by the Administrative
Agent, together with interest at the Federal Funds Effective Rate if not so
reimbursed on the date due from and including such date but not including the
date of reimbursement.
(b) Any amounts received by the Administrative Agent in connection
with this Agreement (other than amounts to which the Administrative Agent is
entitled pursuant to Sections 2.19, 8.6, 9.5 and 9.6), the application of which
is not otherwise provided for in this Agreement, shall be applied, first, in
accordance with each Lender's Commitment Percentage to pay accrued but unpaid
Commitment Fees or Letter of Credit Fees, and second, in accordance with each
Lender's Commitment Percentage to pay accrued but unpaid interest and the
principal balance outstanding and all unreimbursed Letter of Credit drawings.
All amounts to be paid to a Lender by the Administrative Agent shall be
credited to that Lender, after collection by the Administrative Agent, in
immediately available funds either by wire transfer or deposit in that Lender's
correspondent account with the Administrative Agent, as such Lender and the
Administrative Agent shall from time to time agree.
SECTION 8.3 Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrowers, including, but not limited to, a secured claim or other
security or interest arising from, or in lieu of, such secured claim and
received by such Lender under any applicable bankruptcy, insolvency or other
similar law, or otherwise, obtain payment in respect of its Loans as a result
of which the unpaid portion of its Loans is proportionately less than the
unpaid portion of the Loans of any other Lender (a) it shall promptly purchase
at par (and shall be deemed to have thereupon purchased) from such other Lender
a participation in the Loans of such other Lender, so that the aggregate unpaid
principal amount of each Lender's Loans and its participation in Loans of the
other Lenders shall be in the same proportion to the aggregate unpaid principal
amount of all Loans then outstanding as the principal amount of its Loans prior
to the obtaining of such payment was to the principal amount of all Loans
outstanding prior to the obtaining of such payment and (b) such other
adjustments shall be made from time to time as shall be equitable to ensure
that the Lenders share such payment pro-rata, provided that if any such
non-pro-rata payment is thereafter recovered or otherwise set aside such
purchase of participations shall be rescinded (without interest). Each of the
Borrowers expressly consents to the foregoing arrangements and agrees that any
Lender holding (or deemed to be holding) a participation in a Loan may exercise
any and all rights of banker's lien, setoff (in each case, subject to the same
notice requirements as pertain to clause (iv) of the remedial provisions of
Section 7.1) or counterclaim with respect to any and all moneys owing by the
Borrowers to such Lender as fully as if such Lender held a Note and was the
original obligee thereon, in the amount of such participation.
SECTION 8.4 Agreement of Required Lenders. Upon any occasion requiring or
permitting an approval, consent, waiver, election or other action on the part
of the Required Lenders, action shall be taken by the Administrative Agent for
and on behalf or for the benefit of all Lenders upon the direction of the
Required Lenders, and any such action shall be binding on all Lenders. No
amendment, modification, consent, or waiver shall be effective except in
accordance with the provisions of Section 9.10.
SECTION 8.5 Liability of Administrative Agent.
(a) The Administrative Agent, when acting on behalf of the Lenders,
may execute any of its respective duties under this Agreement by or through any
of its respective officers, agents, and employees, and neither the
Administrative Agent nor its directors, officers, agents, employees or
Affiliates shall be liable to the Lenders or any of them for any action taken
or omitted to be taken in good faith, or be responsible to the Lenders or to
any of them for the consequences of any oversight or error of judgment, or for
any loss, unless the same shall happen through its gross negligence or willful
misconduct. The Administrative Agent and its respective directors, officers,
agents, employees and Affiliates shall in no event be liable to the Lenders or
to any of them for any action taken or omitted to be taken by them pursuant to
instructions received by them from the Required Lenders or in reliance upon the
advice of counsel selected by it. Without limiting the foregoing, neither the
Administrative Agent, nor any of its respective directors, officers, employees,
agents or Affiliates shall be responsible to any Lender for the due execution,
validity, genuineness, effectiveness, sufficiency, or enforceability of, or for
any statement, warranty, or representation in, this Agreement, any Loan
Document or any related agreement, document or order, or shall be required to
ascertain or to make any inquiry concerning the performance or observance by
the Borrowers of any of the terms, conditions, covenants, or agreements of this
Agreement or any of the Loan Documents.
(b) Neither the Administrative Agent nor any of its respective
directors, officers, employees, agents or Affiliates shall have any
responsibility to the Borrowers on account of the failure or delay in
performance or breach by any Lender or by the Borrowers of any of their
obligations under this Agreement or any of the Loan Documents or in connection
herewith or therewith.
(c) The Administrative Agent, in its capacity as Administrative
Agent hereunder, shall be entitled to rely on any communication, instrument, or
document reasonably believed by such person to be genuine or correct and to
have been signed or sent by a person or persons believed by such person to be
the proper person or persons, and such person shall be entitled to rely on
advice of legal counsel, independent public accountants, and other professional
advisers and experts selected by such person.
SECTION 8.6 Reimbursement and Indemnification. Each Lender agrees (i) to
reimburse (x) the Administrative Agent for such Lender's Commitment Percentage
of any expenses and fees incurred for the benefit of the Lenders under this
Agreement and any of the Loan Documents, including, without limitation, counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the Lenders, and any other expense incurred in connection with the
operations or enforcement thereof not reimbursed by the Borrowers and (y) the
Administrative Agent for such Lender's Commitment Percentage of any expenses of
the Administrative Agent incurred for the benefit of the Lenders that the
Borrowers have agreed to reimburse pursuant to Section 9.5 and has failed to so
reimburse and (ii) to indemnify and hold harmless the Administrative Agent and
any of its directors, officers, employees, agents or Affiliates, on demand, in
the amount of its proportionate share, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses, or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by, or asserted against it or any of them in any
way relating to or arising out of this Agreement or any of the Loan Documents
or any action taken or omitted by it or any of them under this Agreement or any
of the Loan Documents to the extent not reimbursed by the Borrowers (except
such as shall result from their respective gross negligence or willful
misconduct).
SECTION 8.7 Rights of Administrative Agent. It is understood and agreed
that JPMCB shall have the same rights and powers hereunder (including the right
to give such instructions) as the other Lenders and may exercise such rights
and powers, as well as its rights and powers under other agreements and
instruments to which it is or may be party, and engage in other transactions
with any Borrower, as though it were not the Administrative Agent of the
Lenders under this Agreement.
SECTION 8.8 Independent Lenders. Each Lender acknowledges that it has
decided to enter into this Agreement and to make the Loans hereunder based on
its own analysis of the transactions contemplated hereby and of the
creditworthiness of the Borrowers and agrees that the Administrative Agent
shall bear no responsibility therefor.
SECTION 8.9 Notice of Transfer. The Administrative Agent may deem and
treat a Lender party to this Agreement as the owner of such Lender's portion of
the Loans for all purposes, unless and until a written notice of the assignment
or transfer thereof executed by such Lender shall have been received by the
Administrative Agent.
SECTION 8.10 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrowers. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Administrative Agent, which shall be reasonably
satisfactory to the Borrowers. If no successor Administrative Agent shall have
been so appointed by the Required Lenders and shall have accepted such
appointment, within thirty (30) days after the retiring Administrative Agent's
giving of notice of resignation, the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall be
a commercial bank organized under the laws of the United States of America or
of any State thereof and having a combined capital and surplus of a least
$100,000,000, which shall be reasonably satisfactory to the Borrowers. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations under this Agreement. After
any retiring Administrative Agent's resignation hereunder as Administrative
Agent, the provisions of this Section 8 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.
SECTION 9. MISCELLANEOUS
SECTION 9.1 Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as
follows:
(i) if to the Borrowers, at Interstate Bakeries
Corporation, 00 Xxxx Xxxxxx Xxxxxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000,
Attention of Chief Financial Officer (Telecopy No. 816-502-4232)
and General Counsel (Telecopy No. 816-502-4138);
(ii) if to the Administrative Agent, to JPMorgan Chase
Bank, Loan and Agency Services Group, 0000 Xxxxxx, 0xx Xxxxx,
Xxxxxxx, Xxxxx 00000, Attention of Xxxxx Xxxx (Telecopy No.
713-750-2599) and Rose Comely (Telecopy No. 713-750-2736), with a
copy to JPMorgan Chase Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention of Xxxxxxxxx Xxxxxx (Telecopy No. 212-270-0467);
(iii) if to JPMCB, as Fronting Bank, to it at JPMorgan
Chase Bank, Loan and Agency Services Group, 0000 Xxxxxx, 0xx Xxxxx,
Xxxxxxx, Xxxxx 00000, Attention of Xxxxx Xxxx (Telecopy No.
713-750-2599) and Rose Comely (Telecopy No. 713-750-2736), with a
copy to JPMorgan Chase Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention of Xxxxxxxxx Xxxxxx (Telecopy No. 212-270-0467); and
(iv) if to any Lender, to it at its address (or telecopy
number) set forth in its Administrative Questionnaire.
(b) Notices and other communications to the Lenders hereunder may
be delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Section 2 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrowers may, in their respective discretion, agree to accept notices and
other communications to it hereunder by electronic communications pursuant to
procedures approved by them; provided that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
SECTION 9.2 Survival of Agreement, Representations and Warranties, etc.
All warranties, representations and covenants made by any Borrower herein or in
any certificate or other instrument delivered by it or on its behalf in
connection with this Agreement shall be considered to have been relied upon by
the Lenders and shall survive the making of the Loans herein contemplated
regardless of any investigation made by any Lender or on its behalf and shall
continue in full force and effect so long as any amount due or to become due
hereunder is outstanding and unpaid and so long as the Commitments have not
been terminated. All statements in any such certificate or other instrument
shall constitute representations and warranties by the Borrowers hereunder with
respect to the Borrowers.
SECTION 9.3 Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit
of the Borrowers, the Administrative Agent and the Lenders and their respective
successors and assigns. The Borrowers may neither assign nor transfer any of
their rights or obligations hereunder without the prior written consent of all
of the Lenders. Each Lender may sell participations to any Person in all or
part of any Loan, or all or part of its Commitment, in which event, without
limiting the foregoing, the provisions of Section 2.15 shall inure to the
benefit of each purchaser of a participation (provided that such participant
shall look solely to the seller of such participation for such benefits and the
Borrowers' liability, if any, under Sections 2.15 and 2.18 shall not be
increased as a result of the sale of any such participation) and the pro rata
treatment of payments, as described in Section 2.17, shall be determined as if
such Lender had not sold such participation. In the event any Lender shall sell
any participation, such Lender shall retain the sole right and responsibility
to enforce the obligations of each of the Borrowers relating to the Loans,
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement (provided that such Lender may
grant its participant the right to consent to such Lender's execution of
amendments, modifications or waivers which (i) reduce any Fees payable
hereunder to the Lenders, (ii) reduce the amount of any scheduled principal
payment on any Loan or reduce the principal amount of any Loan or the rate of
interest payable hereunder or (iii) extend the maturity of the Borrowers'
obligations hereunder). The sale of any such participation shall not alter the
rights and obligations of the Lender selling such participation hereunder with
respect to the Borrowers.
(b) Subject to the conditions set forth below, each Lender may
assign to one or more Lenders or Eligible Assignees all or a portion of its
interests, rights and obligations under this Agreement (including, without
limitation, all or a portion of its separate Commitments and the same portion
of the related Loans at the time owing to it), with the prior written consent
(such consent not to be unreasonably withheld) of: (A) the Administrative
Agent, provided that no consent of the Administrative Agent shall be required
for an assignment of all or any portion of the Loans to a Lender, an Affiliate
of a Lender or an Approved Fund; and (B) each Fronting Bank.
(c) Assignments shall be subject to the following additional
conditions:
(i) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining
amount of the assigning Lender's Commitment or Loans of any Class,
the amount of the Commitment or Loans of the assigning Lender
subject to each such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than
$1,000,000 or the remaining portion of such Lender's Commitment
and/or Loans, if less, unless the Administrative Agent otherwise
consents; and
(ii) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and
recording in the Register (as defined below), an Assignment and
Acceptance with blanks appropriately completed, together with a
processing and recordation fee of $3,500 (for which the Borrowers
shall have no liability). Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each
Assignment and Acceptance, which effective date shall be within ten
(10) Business Days after the execution thereof (unless otherwise
agreed to in writing by the Administrative Agent), (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 thereunder shall, to the
extent provided in such Assignment and Acceptance, be released from
its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of
an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto).
(d) 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 respect to any statements, warranties or representations
made in or in connection with this Agreement or any of the other Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement or any of the other Loan Documents; (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 its obligations under this Agreement or
any of the other Loan Documents or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement and the other Loan Documents, together with copies of the
financial statements referred to in Section 3.4 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (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 appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms thereto, together with such powers as are
reasonably incidental hereof; and (vi) such assignee agrees that it will
perform in accordance with their terms all obligations that by the terms of
this Agreement are required to be performed by it as a Lender.
(e) The Administrative Agent shall maintain at its office 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 Commitments of,
and principal amount of the Loans owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrowers, the Administrative Agent and the Lenders
shall treat each Person the name of which 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.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and the assignee thereunder together with the fee payable in
respect thereto, the Administrative Agent shall, if such Assignment and
Acceptance has been completed with blanks appropriately filled and consented to
by the Administrative Agent and the Fronting Bank (to the extent such consent
is required hereunder), (i) accept such Assignment and Acceptance, (ii) record
the information contained therein in the Register and (iii) give prompt written
notice thereof to the Borrowers (together with a copy thereof). No assignment
shall be effective for purposes of this Agreement unless it has been recorded
in the Register as provided in this paragraph.
(g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.3, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrowers furnished to such Lender
by or on behalf of any of the Borrowers; provided that prior to any such
disclosure, each such assignee or participant or proposed assignee or
participant shall agree in writing to be bound by the provisions of Section
9.4.
(h) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any pledge or
assignment of a security interest, provided that no such pledge or assignment
of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
SECTION 9.4 Confidentiality. Each Lender agrees to keep any information
delivered or made available by any of the Borrowers to it confidential from
anyone other than persons employed or retained by such Lender who are or are
expected to become engaged in evaluating, approving, structuring or
administering the Loans; provided that nothing herein shall prevent any Lender
from disclosing such information (i) to any of its Affiliates or to any other
Lender, provided such Affiliate agrees to keep such information confidential to
the same extent required by the Lenders hereunder, (ii) upon the order of any
court or administrative agency, (iii) upon the request or demand of any
regulatory agency or authority, (iv) which has been publicly disclosed other
than as a result of a disclosure by the Administrative Agent or any Lender
which is not permitted by this Agreement, (v) in connection with any litigation
to which the Administrative Agent, any Lender, or their respective Affiliates
may be a party to the extent reasonably required, (vi) to the extent reasonably
required in connection with the exercise of any remedy hereunder, (vii) to such
Lender's legal counsel and independent auditors, and (viii) to any actual or
proposed participant or assignee of all or part of its rights hereunder subject
to the proviso in Section 9.3(g). Each Lender shall notify the Borrowers of any
required disclosure under clause (ii) of this Section; provided, however, that
the failure of any such Lender to provide such notification shall not limit,
alter or otherwise affect any of the Borrowers' obligations under this
Agreement.
SECTION 9.5 Expenses. Whether or not the transactions hereby contemplated
shall be consummated, the Borrowers agree to pay all reasonable expenses
incurred by the Administrative Agent and X.X. Xxxxxx Securities Inc.
(including, without limitation, the reasonable fees and disbursements of Xxxxx
Xxxx LLP, counsel for the Administrative Agent, any other counsel that the
Administrative Agent shall retain and any internal or third-party appraisers,
consultants and auditors advising the Administrative Agent and X.X. Xxxxxx
Securities Inc. and their counsel) in connection with the preparation,
execution, delivery and administration of this Agreement and the other Loan
Documents, the making of the Loans and the issuance of the Letters of Credit,
the perfection of the Liens contemplated hereby, the syndication of the
transactions contemplated hereby, the costs, fees and expenses of the
Administrative Agent and X.X. Xxxxxx Securities Inc. in connection with the
initial and periodic collateral reviews and appraisals, field audits,
monitoring of assets (including collateral monitoring fees of or incurred by
the Administrative Agent) and publicity expenses, and, following the occurrence
of an Event of Default, all expenses incurred by the Lenders and the
Administrative Agent in the enforcement or protection of the rights of any one
or more of the Lenders or the Administrative Agent in connection with this
Agreement or the other Loan Documents, including but not limited to the fees
and disbursements of any counsel for the Lenders or the Administrative Agent.
Such payments by the Borrowers shall be made upon delivery of a statement
setting forth such costs and expenses. Whether or not the transactions hereby
contemplated shall be consummated, the Borrowers agree to reimburse the
Administrative Agent and X.X. Xxxxxx Securities Inc. for the expenses set forth
in the Commitment Letter and the reimbursement provisions thereof are hereby
incorporated herein by reference. The obligations of the Borrowers under this
Section shall survive the termination of this Agreement and/or the payment of
the Loans.
SECTION 9.6 Indemnity. Each of the Borrowers agree to indemnify and hold
harmless the Administrative Agent, X.X. Xxxxxx Securities Inc. and the Lenders
and their directors, officers, employees, trustees, advisors, agents and
Affiliates (each an "Indemnified Party") from and against any and all expenses,
losses, claims, damages and liabilities incurred by such Indemnified Party
arising out of claims made by any Person in any way relating to the
transactions contemplated hereby, but excluding therefrom all expenses, losses,
claims, damages, and liabilities to the extent that they are determined by the
final judgment of a court of competent jurisdiction to have resulted from the
gross negligence or willful misconduct of such Indemnified Party. The
obligations of the Borrowers under this Section shall survive the termination
of this Agreement and/or the payment of the Loans.
SECTION 9.7 Choice of Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK, APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED
WHOLLY WITHIN SUCH STATE AND THE BANKRUPTCY CODE.
SECTION 9.8 No Waiver. No failure on the part of the Administrative Agent
or any of the Lenders to exercise, and no delay in exercising, any right, power
or remedy hereunder or any of the other Loan Documents shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. All remedies hereunder are cumulative and
are not exclusive of any other remedies provided by law.
SECTION 9.9 Extension of Maturity. Should any payment of principal of or
interest or any other amount due hereunder become due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and, in the case of principal, interest shall be
payable thereon at the rate herein specified during such extension.
SECTION 9.10 Amendments, etc.
(a) No modification, amendment or waiver of any provision of this
Agreement or the Security and Pledge Agreement, and no consent to any departure
by the Borrowers therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the purpose
for which given; provided, however, that no such modification or amendment
shall without the written consent of the Lender affected thereby (x) increase
the Commitment of a Lender (it being understood that a waiver of an Event of
Default shall not constitute an increase in the Commitment of a Lender), or (y)
reduce the principal amount of any Loan (or any unreimbursed Letter of Credit)
or the rate of interest payable thereon, or extend any date for the payment of
interest, principal or fees hereunder or reduce any Fees payable hereunder or
extend the final maturity of the Borrowers' obligations hereunder; and,
provided, further, that no such modification or amendment shall without the
written consent of (A) all of the Lenders (i) amend or modify any provision of
this Agreement which provides for the unanimous consent or approval of the
Lenders, (ii) amend this Section 9.10 or the definition of Required Lenders,
(iii) amend or modify the Superpriority Claim status of the Lenders
contemplated by Section 2.23 or (B) the Super-Majority Lenders (i) release any
material portion of the Collateral from the Liens created under the Security
and Pledge Agreement (other than with respect to asset sales permitted under
Section 6.11), (ii) release any Borrower from its joint and several obligations
under Section 2.7, (iii) alter the eligibility standards used in determining
the Borrowing Base in a manner which would increase the amount of the Borrowing
Base, or (iv) increase the advance rates in calculation of the Borrowing Base.
No such amendment or modification may adversely affect the rights and
obligations of the Administrative Agent or any Fronting Bank hereunder or any
Lender in the capacity referred to in Section 6.3(v) without its prior written
consent. No notice to or demand on any Borrower shall entitle any Borrower to
any other or further notice or demand in the same, similar or other
circumstances. Each assignee under Section 9.3(b) shall be bound by any
amendment, modification, waiver, or consent authorized as provided herein, and
any consent by a Lender shall bind any Person subsequently acquiring an
interest on the Loans held by such Lender. No amendment to this Agreement shall
be effective against any Borrower unless in writing and signed by such
Borrower.
(b) Notwithstanding anything to the contrary contained in Section
9.10(a), in the event that any Borrower requests that this Agreement be
modified or amended in a manner which would require the unanimous consent of
all of the Lenders (or the consent described in clause (B) of the first
sentence in Section 9.10(a)) and such modification or amendment is agreed to by
the Super-majority Lenders (as hereinafter defined), then with the consent of
the Borrowers and the Super-majority Lenders, the Borrowers and the
Super-majority Lenders shall be permitted to amend the Agreement without the
consent of the Lender or Lenders which did not agree to the modification or
amendment requested by such Borrower (such Lender or Lenders, collectively the
"Minority Lenders") to provide for (w) the termination of the Commitment of
each of the Minority Lenders, (x) the addition to this Agreement of one or more
other financial institutions (each of which shall be an Eligible Assignee), or
an increase in the Commitment of one or more of the Super-majority Lenders, so
that the Total Commitment after giving effect to such amendment shall be in the
same amount as the Total Commitment immediately before giving effect to such
amendment, (y) if any Loans are outstanding at the time of such amendment, the
making of such additional Loans by such new financial institutions or
Super-majority Lender or Lenders, as the case may be, as may be necessary to
repay in full the outstanding Loans of the Minority Lenders immediately before
giving effect to such amendment and (z) such other modifications to this
Agreement as may be appropriate. As used herein, the term "Super-majority
Lenders" shall mean, at any time, Lenders including JPMCB holding Loans
representing at least 66-2/3% of the aggregate principal amount of the Loans
outstanding, or if no Loans are outstanding, Lenders having Commitments
representing at least 66-2/3% of the Total Commitment.
SECTION 9.11 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 9.12 Headings. Section headings used herein are for convenience
only and are not to affect the construction of or be taken into consideration
in interpreting this Agreement.
SECTION 9.13 Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall constitute an original, but all
of which taken together shall constitute one and the same instrument.
SECTION 9.14 Prior Agreements; Inconsistencies. This Agreement represents
the entire agreement of the parties with regard to the subject matter hereof
and the terms of any letters and other documentation entered into between any
Borrower and any Lender or the Administrative Agent prior to the execution of
this Agreement which relate to Loans to be made hereunder shall be replaced by
the terms of this Agreement (except as otherwise expressly provided herein with
respect to the Commitment Letter and the fee letter referred to therein,
including without limitation the Borrowers' agreement to actively assist the
Administrative Agent in the syndication of the transactions contemplated hereby
referred to in Section 9.3(g) and including also the provisions of Section
2.19). In the event of any conflicts between the express provisions of this
Agreement and the Orders, the provisions of the Orders shall control to the
extent of any such inconsistency. In the event of any conflicts between the
express provisions of this Agreement and the Security Agreement, the provisions
of this Agreement shall control to the extent of any such inconsistency.
SECTION 9.15 Further Assurances. Whenever and so often as reasonably
requested by the Administrative Agent, the Borrowers will promptly execute and
deliver or cause to be executed and delivered all such other and further
instruments, documents or assurances, and promptly do or cause to be done all
such other and further things as may be necessary and reasonably required in
order to further and more fully vest in the Administrative Agent all rights,
interests, powers, benefits, privileges and advantages conferred or intended to
be conferred by this Agreement and the other Loan Documents.
SECTION 9.16 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY.
SECTION 9.17 Subordination of Intercompany Indebtedness. Each of the
Borrowers agree that any and all Intercompany Indebtedness owed to any Borrower
shall be subordinate and subject in right of payment to the prior payment, in
full and in cash, of all Obligations. Notwithstanding any right of any Borrower
to ask, demand, xxx for, take or receive any payment in respect of any
Intercompany Indebtedness owed to any Borrower , any and all rights, liens and
security interests of any Borrower, whether now or hereafter arising and
howsoever existing, in any assets of any other Subsidiary of Parent (whether
constituting part of Collateral given to the Administrative Agent for the
benefit of the Lenders to secure payment of all or any part of the Obligations
or otherwise) shall be and are subordinated to the rights of the Administrative
Agent and the Lenders in those assets. No Borrower shall have any right to
possession of any such asset or to foreclose upon any such asset, whether by
judicial action or otherwise, unless and until all of the Obligations (other
than contingent indemnity obligations) shall have been fully paid and satisfied
and all financing arrangements among the Borrowers and the Lenders have been
terminated. So long as any Event of Default shall have occurred and be
continuing, then, any payment or distribution of any kind or character, either
in cash, securities or other property, which shall be payable or deliverable
upon or with respect to any Intercompany Indebtedness owed by any Borrower
shall be paid or delivered directly to the Administrative Agent for application
on any of the Obligations, due or to become due, until such Obligations (other
than contingent indemnity obligations) shall have first been fully paid and
satisfied. Each of the Borrowers irrevocably authorize and empower the
Administrative Agent to demand, xxx for, collect and receive every such payment
or distribution and give acquittance therefor and to make and present for and
on behalf of any Borrower such proofs of claim and take such other action, in
the Administrative Agent's own name or in the name of the applicable Borrower
or otherwise, as the Administrative Agent may deem necessary or advisable for
the enforcement of this Section 9.17. The Administrative Agent may vote such
proofs of claim in any such proceeding, receive and collect any and all
dividends or other payments or disbursements made thereon in whatever form the
same may be paid or issued and apply the same on account of any of the
Obligations. Should any payment, distribution, security or instrument or
proceeds thereof be received by any Borrower upon or with respect to the
Intercompany Indebtedness at any time an Event of Default shall have occurred
and be continuing and prior to the satisfaction of all of the Obligations and
the termination of all financing arrangements among the Borrowers and the
Lenders, the applicable Borrower shall receive and hold the same in trust, as
trustee, for the benefit of the Lenders and shall so long as any Event of
Default shall have occurred and be continuing promptly deliver the same to the
Administrative Agent, for the benefit of the Lenders, in precisely the form
received (except for the endorsement or assignment of the applicable Borrower
where necessary), for application to any of the Obligations, due or not due,
and, until so delivered, the same shall be held in trust by the applicable
Borrower as the property of the Lenders. If any Borrower fails to make any such
endorsement or assignment to the Administrative Agent, the Administrative Agent
or any of its officers or employees are irrevocably authorized to make the
same. So long as any Event of Default shall have occurred and be continuing,
the Borrowers agree that until the Obligations have been paid in full (in cash)
and satisfied and all financing arrangements among the Borrowers and the
Lenders have been terminated, the Borrowers will neither assign nor transfer to
any Person (other than the Administrative Agent) any claim the Borrowers have
or may have against any other Subsidiary of the Parent Borrower
SECTION 9.18 Certain Post Closing Matters.
(a) Notwithstanding anything to the contrary contained in this
Agreement, within the time periods set forth below or such later date(s) to
which the Administrative Agent shall, in its exclusive discretion, agree in
writing, the Borrowers shall deliver to the Administrative Agent:
(i) within thirty (30) days after the Closing Date, all
Lien searches, if any, which the Borrowers were required to deliver
pursuant to Section 4.1(k) of this Agreement and delivery of which
was temporarily waived by the Lenders for the purposes of effecting
the closing on the Closing Date;
(ii) within ninety (90) days after the Closing Date,
mortgages in favor of the Collateral Agent and in form and
substance reasonably satisfactory to the Administrative Agent on
such Eligible Real Property of the Borrowers as may then constitute
all or any part of the Real Property Component, together with such
updated title commitments and related real estate due diligence
materials as the Administrative Agent may request in accordance
with the definition of Eligible Real Property;
(iii) upon the Administrative Agent's acceptance of the
Budget, and in any event no later than the date which is one
hundred fifty (150) days after the Closing Date, the Borrowers
shall have executed and delivered an amendment to this Agreement
setting forth the financial covenant levels for Sections 6.4 and
6.5 of this Agreement, which covenants shall be satisfactory to the
Administrative Agent;
(iv) within thirty (30) days after the Closing Date, all
good standing certificates, if any, which the Borrowers were
required to deliver pursuant to Section 4.1(a)(iv) of this
Agreement and delivery of which was temporarily waived by the
Lenders for the purposes of effecting the closing on the Closing
Date; provided that one or more of the Borrowers may identify to
the Administrative Agent certain of the jurisdictions from which
they shall not have obtained good standing certificates as of the
Closing Date as jurisdictions in which the Borrower(s) do not
conduct a material amount of business and the Administrative Agent
may thereafter (but shall not be obligated to) waive delivery of a
good standing certificate for such jurisdiction(s);
(v) Schedules 1.1, 3.6, 3.12, 6.9, 6.10 and 6.13, which the
Borrowers were required to deliver pursuant to Section 1.1, 3.6,
3.12, 6.9, 6.10 and 6.13 of this Agreement, respectively, and
delivery of which was temporarily waived by the Lenders for the
purposes of effecting the closing on the Closing Date.
(b) Notwithstanding anything to the contrary contained in this
Agreement or the Security and Pledge Agreement, within thirty (30) days after
the Closing Date or such later date to which the Collateral Agent shall, in its
reasonable discretion, agree in writing, the Borrowers shall deliver to the
Collateral Agent:
(i) Schedules 1, 3, 4, 6, 7, and 8, which the Borrowers
were required to deliver pursuant to Section 4(a), 1(h), 1(i),
1(m), 1(n), and 1(o) of the Security and Pledge Agreement,
respectively, and delivery of which was temporarily waived by the
Lenders for the purposes of effecting the closing on the Closing
Date.
(c) All conditions precedent and representations contained in the
Loan Documents shall be deemed modified to the extent necessary to effect the
foregoing (and to permit the taking of the actions described above within the
time periods required above); provided, that to the extent any representation
and warranty would not be true because the foregoing actions were not taken on
the Closing Date, the respective representation and warranty shall be required
to be true and correct at the time the respective action is taken in accordance
with the foregoing provisions of this Section 9.18. The acceptance of the
benefits of the making of each Loan and the issuance of each Letter of Credit
shall constitute a representation, warranty and covenant by the Borrowers to
each of the Lenders that the actions required pursuant to this Section 9.18
will be taken within the relevant time periods referred to in this Section 9.18
and that, at such time, all representations and warranties contained in this
Agreement shall then be true and correct without any modification pursuant to
this Section 9.18.
SECTION 9.19 USA Patriot Act. Each Lender hereby notifies the Borrowers
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the "Act"), it is required to
obtain, verify and record information that identifies the Borrowers, which
information includes the name and address of the Borrowers and other
information that will allow such Lender to identify the Borrower in accordance
with the Act.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and the year first written.
BORROWERS:
INTERSTATE BAKERIES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN: 00-0000000
ARMOUR AND MAIN REDEVELOPMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN: 00-0000000
XXXXX'X INN QUALITY BAKED GOODS, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN:
IBC SALES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
00-0000000
IBC SERVICES, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN: 00-0000000
IBC TRUCKING, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
00 Xxxx Xxxxxx Xxxxxxxxx
X.X. Xxx 000000
Xxxxxx Xxxx, XX 00000
FEIN: 00-0000000
INTERSTATE BRANDS CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN: 00-0000000
NEW ENGLAND BAKERY DISTRIBUTORS, L.L.C.
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, XX 00000
FEIN:
LENDERS:
JPMORGAN CHASE BANK,
Individually and as Administrative Agent
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Managing Director
