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Exhibit 10.51
DEBTOR-IN-POSSESSION
REVOLVING CREDIT AGREEMENT
by and among
REPUBLIC TECHNOLOGIES INTERNATIONAL, LLC
FLEET CAPITAL CORPORATION,
AS ADMINISTRATIVE AGENT AND CO-BOOK MANAGER
BANK OF AMERICA, N.A.,
AS SYNDICATION AGENT AND CO-BOOK MANAGER
AND
THE CHASE MANHATTAN BANK,
AS DOCUMENTATION AGENT AND CO-BOOK MANAGER
AND THE LENDING INSTITUTIONS LISTED ON SCHEDULE 1 HERETO
AS LENDERS
April 3, 2001
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TABLE OF CONTENTS
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.............................................................2
1.1. Definitions.....................................................................................2
1.2. Rules of Interpretation.........................................................................27
Section 2. THE REVOLVING CREDIT FACILITY.......................................................................28
2.1. Commitment to Lend..............................................................................28
2.2. Commitment Fee..................................................................................29
2.3. Reduction of Total Commitment...................................................................29
2.4. the Revolving Credit Notes......................................................................29
2.5. Interest On Revolving Credit Loans..............................................................30
2.6. Requests for Revolving Credit Loans.............................................................30
2.7. Conversion Options..............................................................................31
2.8. Funds for Revolving Credit Loan.................................................................32
2.9. Change in Borrowing Base........................................................................34
Section 3. REPAYMENT OF THE REVOLVING CREDIT LOANS.............................................................34
3.1. Maturity........................................................................................34
3.2. Mandatory Repayments of Revolving Credit Loans..................................................34
3.3. Optional Repayments of Revolving Credit Loans...................................................36
3.4. Automatic Repayments of Revolving Credit Loans Prior to Event of Default........................36
3.5. Automatic Repayments of Revolving Credit Loans After Event of Default...........................37
Section 4. LETTERS OF CREDIT...................................................................................38
4.1. Letter of Credit Commitments....................................................................38
4.2. Reimbursement Obligation of the Borrower........................................................39
4.3. Letter of Credit Payments.......................................................................39
4.4. Obligations Absolute............................................................................40
4.5. Reliance by Issuer..............................................................................41
4.6. Letter of Credit Fee............................................................................41
4.7. Cash Collateral for Letter of Credit Obligations................................................41
4.8. Rollover LC'S...................................................................................42
Section 5. CERTAIN GENERAL PROVISIONS..........................................................................42
5.1. Fees............................................................................................42
5.2. Funds for Payments..............................................................................42
5.3. Computations....................................................................................44
5.4. Inability to Determine Eurodollar Rate..........................................................45
5.5. Illegality......................................................................................45
5.6. Additional Costs, Etc...........................................................................45
5.7. Capital Adequacy................................................................................46
5.8. Certificate.....................................................................................47
5.9. Indemnity.......................................................................................47
5.10. Interest After Default..........................................................................47
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5.11. Replacement Lenders.............................................................................48
Section 6. PRIORITY AND COLLATERAL SECURITY; GUARANTY..........................................................49
6.1. Priority and Collateral Security................................................................49
6.2. Guaranty........................................................................................50
Section 7. REPRESENTATIONS AND WARRANTIES......................................................................54
7.1. Corporate Authority.............................................................................54
7.2. Governmental Approvals..........................................................................55
7.3. Title to Properties; Leases.....................................................................55
7.4. Financial Statements and Projections............................................................55
7.5. No Material Changes, Etc........................................................................56
7.6. Franchises, Patents, Copyrights, Etc............................................................56
7.7. Litigation......................................................................................56
7.8. No Materially Adverse Contracts, Etc............................................................57
7.9. Compliance With Other Instruments, Laws, Etc....................................................57
7.10. Tax Status......................................................................................57
7.11. No Event of Default.............................................................................57
7.12. Holding Company and Investment Company Acts.....................................................57
7.13. Absence of Financing Statements, Etc............................................................57
7.14. Employee Benefit Plans..........................................................................58
7.15. Use of Proceeds.................................................................................58
7.16. Environmental Compliance........................................................................59
7.17. Subsidiaries, Etc...............................................................................60
7.18. Bank Accounts; Agency Account Arrangements......................................................60
7.19. Fiscal Year.....................................................................................60
7.20. Disclosure......................................................................................60
7.21. Perfection of Security Interest.................................................................61
7.22. Filed Entities..................................................................................61
8. AFFIRMATIVE COVENANTS OF THE BORROWER......................................................................61
8.1. Punctual Payment................................................................................61
8.2. Maintenance of Office...........................................................................61
8.3. Records and Accounts............................................................................61
8.4. Financial Statements, Certificates and Information..............................................61
8.5. Notices.........................................................................................64
8.6. Existence; Maintenance of Properties............................................................66
8.7. Insurance.......................................................................................66
8.8. Taxes, Etc......................................................................................67
8.9. Inspection of Properties and Books, Etc.........................................................67
8.10. Compliance With Laws, Contracts, Licenses, and Permits..........................................67
8.11. Employee Benefit Plans..........................................................................69
8.12. Use of Proceeds.................................................................................69
8.13. Bank Accounts; Agency Account Arrangements........................................... ..........69
8.14. Borrowing Base..................................................................................71
8.15. Further Assurances..............................................................................72
8.16. Retention of Financial Advisor..................................................................72
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8.17. Collateral Preservation........................................................................72
8.18. Engagement of Advisor(s).......................................................................72
8.19. Security Documentation.........................................................................72
Section 9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER..........................................................72
9.1. Restrictions On Indebtedness....................................................................73
9.2. Restrictions On Liens...........................................................................74
9.3. Restrictions On Investments.....................................................................76
9.4. Change in Terms of Capital Stock; Distributions and Other Restricted Payments...................78
9.5. Merger and Consolidation........................................................................78
9.6. Sale and Leaseback; Disposition of Assets.......................................................78
9.7. Compliance With Environmental Laws..............................................................79
9.8. Indebtedness in Respect of the Notes............................................................79
9.9. Employee Benefit Plans..........................................................................79
9.10. Bank Accounts...................................................................................80
9.11. Limitation On Issuance of Shares of Subsidiaries; Disposition of Shares and
Indebtedness of Subsidiaries....................................................................80
9.12. No Material Changes, Etc........................................................................80
9.13. No Subsidiaries.................................................................................80
9.14. Transactions With Affiliates....................................................................81
9.15. Parent..........................................................................................81
9.16. Bankruptcy Cases................................................................................81
Section 10. FINANCIAL COVENANTS OF THE BORROWER................................................................82
10.1. Maximum Net Capital Expenditures...............................................................82
10.2. Minimum EBITDA.................................................................................82
10.3. Minimum Liquidity..............................................................................82
Section 11. CONCERNING THE EFFECTIVE DATE; CONDITIONS TO EFFECTIVENESS.........................................82
11.1. Loan Documents.................................................................................82
11.2. Certified Copies of Charter Documents..........................................................83
11.3. Corporate or Limited Liability Company Action..................................................83
11.4. Incumbency Certificate.........................................................................83
11.5. Validity of Liens..............................................................................83
11.6. UCC Search Results.............................................................................83
11.7. Certificates of Insurance......................................................................83
11.8. Opinions of Counsel............................................................................84
11.9. Payment of Fees................................................................................84
11.10. Repayment of Indebtedness......................................................................84
11.11. Cash Budget....................................................................................84
11.12. First Day Orders...............................................................................84
Section 12. CONDITIONS TO ALL BORROWINGS.......................................................................84
12.1. Representations True...........................................................................84
12.2. No Legal Impediment............................................................................84
12.3. Governmental Regulation........................................................................85
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12.4. Proceedings and Documents......................................................................85
12.5. Case Administration............................................................................85
Section 13. EVENTS OF DEFAULT; ACCELERATION; ETC...............................................................85
13.1. Events of Default and Acceleration.............................................................85
13.2. Termination of Commitments.....................................................................89
13.3. Remedies.......................................................................................89
13.4. Distribution of Collateral Proceeds............................................................90
Section 14. SETOFF.............................................................................................91
Section 15. THE ADMINISTRATIVE AGENT...........................................................................91
15.1. Authorization..................................................................................92
15.2. Employees and Agents...........................................................................92
15.3. No Liability...................................................................................92
15.4. No Representations.............................................................................92
15.5. Payments.......................................................................................93
15.6. Holders of Revolving Credit Notes..............................................................94
15.7. Indemnity......................................................................................94
15.8. Administrative Agent as Lender.................................................................94
15.9. Resignation....................................................................................94
15.10 Notification of Defaults and Events of Default.................................................95
15.11. Duties in the Case of Enforcement..............................................................95
Section 16. EXPENSES...........................................................................................95
Section 17. INDEMNIFICATION....................................................................................96
Section 18. SURVIVAL OF COVENANTS, ETC.........................................................................97
Section 19. ASSIGNMENT AND PARTICIPATION.......................................................................97
19.1. Conditions to Assignment by Lenders............................................................97
19.2. Certain Representations and Warranties; Limitations; Covenants.................................98
19.3. Register.......................................................................................98
19.4. New Revolving Credit Notes.....................................................................99
19.5. Participations.................................................................................99
19.6. Assignee or Participant Affiliated With the Borrower...........................................99
19.7. Miscellaneous Assignment Provisions...........................................................100
19.8. Assignment by Borrower........................................................................100
Section 20. NOTICES, ETC......................................................................................100
Section 21. GOVERNING LAW.....................................................................................101
Section 22. HEADINGS..........................................................................................101
Section 23. COUNTERPARTS......................................................................................101
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Section 24. ENTIRE AGREEMENT, ETC.............................................................................101
Section 25. WAIVER OF JURY TRIAL..............................................................................101
Section 26. CONSENTS, AMENDMENTS, WAIVERS, ETC................................................................102
Section 27. SEVERABILITY......................................................................................103
Section 28. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.....................................................103
Section 28.1. Sharing of Information With Section 20 Subsidiary...............................................103
Section 28.2. Confidentiality.................................................................................103
Section 28.3. Prior Notification..............................................................................104
Section 28.4. Other...........................................................................................104
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Exhibits
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Exhibit A - Form of Borrowing Base Report
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Loan Request
Exhibit D - Form of Compliance Certificate
Exhibit E - Form of Assignment and Acceptance
Schedules
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Schedule 1 - Commitments
Schedule 1.1 - Closed Facilities
Schedule 5.1.1 -Facility Fee
Schedule 7.3 - Title to Properties; Leases
Schedule 7.7 - Litigation
Schedule 7.16 - Environmental Compliance
Schedule 7.17 - Subsidiaries
Schedule 7.18 - Bank Accounts
Schedule 7.22 - Filed Entities
Schedule 9.1 - Permitted Indebtedness
Schedule 9.2 - Permitted Liens
Schedule 9.3 - Permitted Investments
Schedule 9.6 - Disposition of Assets
Schedule 9.14 - Transactions with Affiliates
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BD DRAFT
03/30/01
DEBTOR-IN-POSSESSION REVOLVING CREDIT AGREEMENT
-----------------------------------------------
This DEBTOR IN POSSESSION REVOLVING CREDIT AGREEMENT is made as of the
3rd day of April, 2001, by and among REPUBLIC TECHNOLOGIES INTERNATIONAL, LLC, a
debtor and debtor-in-possession and a Delaware limited liability company having
its principal place of business at 0000 Xxxxxxx Xxxxxxx, Xxxxx, XX 00000 (the
"BORROWER"), REPUBLIC TECHNOLOGIES INTERNATIONAL HOLDINGS, LLC, a debtor and
debtor-in-possession and a Delaware limited liability company, RTI CAPITAL
CORP., a debtor and debtor-in-possession and a Delaware corporation, BLISS &
XXXXXXXX, LLC, a debtor and debtor-in-possession and a Delaware limited
liability company, CANADIAN DRAWN STEEL COMPANY INC., a Canadian corporation and
NIMISHILLEN & TUSCARAWAS, LLC, a Delaware limited liability company
(collectively, the "GUARANTORS"), FLEET CAPITAL CORPORATION ("FLEET"), BANK OF
AMERICA, N.A. ("BOFA"), THE CHASE MANHATTAN BANK ("CHASE") and the other lending
institutions from time to time listed on SCHEDULE 1 hereto (the "LENDERS"),
FLEET as Administrative Agent and Co-Book Manager for itself and the Lenders (as
such, the "ADMINISTRATIVE AGENT"), BOFA, as Syndication Agent and Co-Book
Manager, and CHASE as Documentation Agent and Co-Book Manager. Fleet, BofA and
Chase are referred to herein collectively as the "AGENTS".
WHEREAS, the Borrower is a party to the Revolving Credit Agreement,
dated as of August 13, 1999 (as amended, the "PREPETITION CREDIT AGREEMENT"),
among Republic Technologies International, LLC, as borrower, certain
subsidiaries thereof as guarantors, certain lenders thereto and Fleet National
Bank (f/k/a BankBoston, N.A.), BofA and Chase as agents for such lenders;
WHEREAS, as of the date hereof, the lenders under the Prepetition
Credit Agreement are owed approximately $356,789,839.95 in revolving loan
principal obligations, including $10,852,000 in unpaid letter of credit
reimbursement obligations in respect of drawings under Letters of Credit, plus
interest, fees, costs and expenses (the "REFUNDING AMOUNT");
WHEREAS, the obligations under the Prepetition Credit Agreement are
secured by a security interest in certain of the existing and after acquired
assets of the Borrower and the Guarantors, and such security interest is
perfected and has priority over other security interests;
WHEREAS, on April 2, 2001 (the "FILING DATE"), the Borrower and certain
of the Guarantors filed separate petitions under Chapter 11 of the Bankruptcy
Code in the Bankruptcy Court;
WHEREAS, the Borrower intends to continue to operate its business
pursuant to Sections 1107 and 1108 of the Bankruptcy Code;
WHEREAS, the Borrower has requested that the Lenders referred to herein
provide financing to the Borrower consisting of advances and letter of credit
reimbursement obligations in an amount up to $420,000,000 pursuant to Sections
364(c)(1), (2), (3) and (d) of the Bankruptcy
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Code in order to provide working capital for the Borrower, for Capital
Expenditures, to refinance the Prepetition Bank Debt (as hereinafter defined)
and for other general corporate purposes;
WHEREAS, the Borrower has agreed to secure its Obligations hereunder
with, INTER ALIA, liens on and security interests in and to substantially all
property and interests, real and personal, tangible and intangible, of the
Borrower and the Guarantors, whether now owned or hereafter acquired (other than
assets encumbered in favor of certain other parties) subject in priority only to
certain Liens and the Carve Out as hereinafter provided, all on the terms and
conditions set forth in the Loan Documents (as hereinafter defined) in
accordance with Sections 364(c)(1), (2), (3) and (d) of the Bankruptcy Code; and
WHEREAS, the Lenders have indicated their willingness to agree to lend
such amounts pursuant to Sections 364(c)(1), (2), (3) and (d) of the Bankruptcy
Code on the terms and conditions of this Credit Agreement;
NOW THEREFORE, in consideration of these premises and of the mutual
undertakings set forth herein, the parties hereto hereby agree as follows:
Section 1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this Section 1 or elsewhere in the provisions of this Credit Agreement
referred to below:
ACCOUNTS RECEIVABLE. All rights of the Borrower or any of the
Subsidiary Guarantors to payment for goods sold, leased or otherwise marketed in
the ordinary course of business and all rights of the Borrower or any of the
Subsidiary Guarantors to payment for services rendered in the ordinary course of
business and all sums of money or other proceeds due thereon pursuant to
transactions with account debtors recorded on books of account in accordance
with generally accepted accounting principles. Solely for the purpose of
calculating the Borrowing Base, Accounts Receivable shall not include that
portion of the sum of money or other proceeds due thereon that relate to sales,
use or property taxes in conjunction with such transactions with account
debtors.
AFFECTED LENDER. See Section 5.11.
AFFILIATE. Any Person that would be considered to be an affiliate of
the Borrower under Rule 144(a) of the Rules and Regulations of the Securities
and Exchange Commission, as in effect on the date hereof, if the Borrower were
issuing securities.
ADMINISTRATIVE AGENT. See preamble.
ADMINISTRATIVE AGENT'S OFFICE. The Administrative Agent's office
located at Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other
location as the Administrative Agent may designate from time to time.
ADMINISTRATIVE AGENT'S SPECIAL COUNSEL. Xxxxxxx Xxxx LLP or such other
counsel as may be approved by the Administrative Agent.
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AGENCY AGREEMENT. See Section 7.18.
APPLICABLE MARGIN. On any date, the Applicable Margin shall be (a)
3.50% for Eurodollar Rate Loans and (b) 1.50% for Base Rate Loans.
ASSIGNMENT AND ACCEPTANCE. See Section 19.1.
AVAILABILITY. As of any date of determination, the lesser of (a) the
Total Commitment and (b) the Borrowing Base, MINUS the Rate Protection Exposure.
BALANCE SHEET DATE. December 31, 2000.
BANKRUPTCY CODE. Xxxxx 00, Xxxxxx Xxxxxx Code.
BANKRUPTCY COURT. The United States Bankruptcy Court for the Northern
District of Ohio or such other court having jurisdiction over the Cases.
BASE RATE. The higher of (a) the annual rate of interest announced from
time to time by Fleet National Bank at its office in Boston, Massachusetts, as
its "prime rate" and (b) one-half of one percent (1/2%) above the Federal Funds
Effective Rate. For the purposes of this definition, "Federal Funds Effective
Rate" shall mean for any day, the rate per annum equal to the weighted average
of the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three funds brokers of
recognized standing selected by the Administrative Agent.
BASE RATE LOANS. Revolving Credit Loans bearing interest calculated by
reference to the Base Rate.
BLACKSTONE. (A) Blackstone Capital Partners II Merchant Banking Fund,
L.P. a Delaware limited partnership, (B) Blackstone Capital Partners III
Merchant Banking Fund L.P., a Delaware limited partnership, (C) Blackstone
Offshore Capital Partners II L.P., a Cayman Islands exempted limited
partnership, (D) Blackstone Family Investment Partnership II L.P., a Delaware
limited partnership, (E) each general partner of any of the foregoing who is a
partner or employee of The Blackstone Group, L.P. and (F) any Affiliates of any
of the foregoing.
BLOCKED ACCOUNT. See Section 7.18.
BLOCKED ACCOUNT BANK. See Section 7.18.
BOFA. See preamble.
BORROWER. See preamble.
BORROWING BASE. As of any date of determination, an amount determined
by the Administrative Agent by reference to the most recent Borrowing Base
Report which is equal to:
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(a) 85% of Eligible Accounts Receivable for which invoices have been
issued and are payable; PLUS
(b) the sum of (i) 60% of the net book value (determined on a first-in
first-out basis at lower of cost or market) of Eligible Inventory and (ii) the
Special Inventory Advance; PROVIDED, that in no event shall the amount of the
Borrowing Base allocable to Eligible Inventory exceed $190,000,000 during the
period commencing on the Effective Date through January 31, 2002, and
$175,000,000 thereafter; PLUS
(c) the lesser of 75% of Eligible Fixed Assets and the Eligible Fixed
Asset Cap; MINUS
(d) the Priority Professional Expenses Reserve;
PROVIDED HOWEVER, the Administrative Agent reserves the right to
change, upon five (5) Business Days notice to and consultation with the Borrower
but without its consent, eligibility criteria contained in the definitions of
Eligible Accounts Receivable, Eligible Finished Goods Inventory, Eligible Raw
Materials, Eligible Work-in-Process, Eligible Fixed Assets and Canton Cast-Roll
Facility and to change and/or establish reserves taken in connection with any of
the foregoing from time to time based upon the results of any commercial finance
examination conducted pursuant to Section 8.9.2, any appraisals or other sources
of information which demonstrate in the Administrative Agent's reasonable
judgment based on due inquiry a change in the collectability of Accounts
Receivable and/or the marketability of inventory and/or the value or
marketability of the Canton Cast-Roll Facility not reflected in reserves taken
by the Borrower.
BORROWING BASE REPORT. A Borrowing Base Report signed by the treasurer
or other authorized financial officer of the Borrower and the Subsidiary
Guarantors and in substantially the form of EXHIBIT A hereto.
BUSINESS DAY. Any day on which lending institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
BUSINESS PLAN. The business plan delivered to the Lenders entitled
"Republic Technologies International LLC DIP Projections" dated March 31, 2001.
CANADIAN BLOCKED ACCOUNT. See Section 8.13.1.
CANADIAN DOLLARS OR C$. Dollars designated as lawful currency in
Canada.
CANADIAN DRAWN. See Section 8.13.1.
CANADIAN IP ASSIGNMENT. The Assignment of Intellectual Property dated
as of the date hereof, and as amended and in effect from time to time, between
Canadian Drawn Steel Company Inc. and the Administrative Agent.
CANADIAN LOCKBOX. See Section 8.13.1.
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CANADIAN SECURITY AGREEMENT. The Security Agreement dated as of the
date hereof and as amended and in effect from time to time, between Canadian
Drawn Steel Company and the Administrative Agent.
CANTON CAST-ROLL FACILITY. The cast-roll facility and related assets of
the Borrower located in Canton, Ohio at the premises described in EXHIBIT A to
the Mortgage, including, without limitation, all equipment, fixtures, goods and
other fixture and personal property located from time to time at such premises
and related property.
CAPITAL ASSETS. Fixed assets (such as land, buildings, fixtures,
machinery and equipment) and intangible assets (such as patents, copyrights,
trademarks, franchises and goodwill); PROVIDED that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with generally accepted
accounting principles.
CAPITAL EXPENDITURES. Amounts paid or Indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with (a) the purchase or lease
by the Borrower or any of its Subsidiaries of Capital Assets that would be
required to be capitalized and shown on the balance sheet of such Person in
accordance with generally accepted accounting principles or (b) the lease of any
assets by the Borrower or any of its Subsidiaries as lessee under any synthetic
lease referred to in clause (vi) of the definition of the term "Indebtedness" to
the extent that such assets would have been Capital Assets had the synthetic
lease been treated for accounting purposes as a Capitalized Lease; PROVIDED,
HOWEVER, that Capital Expenditures for the Borrower and its Subsidiaries shall
not include (i) expenditures of proceeds of insurance settlements, condemnation
awards and other settlements in respect of lost, destroyed, damaged or condemned
assets, equipment or other property to the extent such expenditures are made to
replace or repair such lost, destroyed, damaged or condemned assets, equipment
or other property or otherwise to acquire assets or properties useful in the
business of the Borrower and its Subsidiaries within 180 days of receipt of such
proceeds, (ii) expenditures that are accounted for as Capital Expenditures of
such person and that actually are paid for by a third party (excluding Borrower
or any Subsidiary thereof) and for which neither the Borrower nor any Subsidiary
thereof has provided any consideration or obligation to such third party or
(iii) the book value of any asset owned by such Person prior to or during such
period to the extent that such book value is included as a capital expenditure
during such period as a result of such person reusing or beginning to reuse such
asset during such period without a corresponding expenditure actually having
been made in such period or committed to be made in a later period, PROVIDED
that any expenditure necessary in order to permit such asset to be reused shall
be included as a Capital Expenditure during the period that such expenditure
actually is made and such book value shall have been included in Capital
Expenditures when such asset was originally acquired.
CAPITALIZED INTEREST. For any period, the aggregate amount of interest
paid or accrued, without duplication as to any previous period, by the Borrower
during such period in respect of the financing of any Capital Expenditures and
required to be capitalized in accordance with generally accepted accounting
principles.
CAPITALIZED LEASES. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to
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be capitalized on the balance sheet of the lessee or obligor in accordance with
generally accepted accounting principles.
CARVE OUT. At any time of determination, the sum of (a) allowed
administrative expenses payable pursuant to 28 U.S.C. Section 1930(a)(6) and (b)
Priority Professional Expenses.
CASES. Collectively, the Borrower's and the Guarantors' reorganization
cases under Chapter 11 of the Bankruptcy Code, pending in the Bankruptcy Court.
CASH BUDGET. See Section 7.4.3.
CERCLA. See Section 7.16.
CHANGE OF CONTROL. Other than in connection with the Reorganization
Plan, at any time, the occurrence of one or more of the following events: (i)
the sale, lease or transfer, in one or a series of related transactions, of all
or substantially all the assets of the Borrower and its Subsidiaries, taken as a
whole, to a person other than the Permitted Holders; or (ii) (A) the acquisition
by any person or group (within the meaning of Section 13(d) (3) or Section 14(d)
(2) of the Exchange Act, or any successor provision), including any group acting
for the purpose of acquiring, holding or disposing of securities (within the
meaning of Rule 13d-5(b) (1) under the Exchange Act), other than the Permitted
Holders, in a single transaction or in a related series of transactions, by way
of merger, consolidation or other business combination or purchase of beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any
successor provision), of 35% or more of the total voting power of the capital
stock or membership interests of the Borrower and (B) the Permitted Holders
beneficially own (as defined above), directly or indirectly, in the aggregate a
lesser percentage of the total voting power of the Voting Stock of the Borrower
than such other Person or group and do not have the right or ability by voting
power, contract or otherwise to elect or designate for election a majority of
the Board of Directors or similar governing body of the Borrower; or (iii)
Blackstone shall own, beneficially, directly or indirectly, less than 20% of the
total voting and economic interest of the capital stock or membership interests
of the Borrower; or (iv) directors elected by Blackstone shall cease to
represent a majority of the members of the board of directors or similar
governing body of the Borrower.
CHASE. See preamble.
CHASE LETTER OF CREDIT. The Letter of Credit in the amount of
$3,852,000 dated December 5, 1996 issued by Chase for the benefit of U.S. Bank
Trust National Association as Trustee under the Indenture of Trust between the
Development Authority of Cartersville and the U.S. Bank Trust National
Association as Trustee. The Chase Letter of Credit is a Letter of Credit
hereunder.
CLOSED FACILITIES. Upon their shut down or closure and subsequent sale,
scrapping or other disposition, the No. 4 blast Furnace, the No. 1 Billet Caster
and the 4 Stand Billet Mill at the Lorain facility, the No. 4(B) and No. 4(C)
Electric Arc Furnaces, the Blooming Mill and the ingot teeming facility in the
Canton, Ohio facility, the 12" bar mill in Canton, Ohio, the cold-finishing
facilities in Medina, Ohio and Batavia; Illinois, the 18" bar mill in Masillon,
Ohio and
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the 11" bar mill in Chicago, Illinois and one additional cold-finishing
facility, in each case to the extent (i) separable and identifiable and not in
impairment in any material respect of any other Collateral, and (ii) not
constituting the Cast-Roll Facility, as well as any other facilities closed
prior to the Effective Date and set forth on SCHEDULE 1.1.
CODE. The Internal Revenue Code of 1986, as amended from time to time.
COLLATERAL. All accounts, inventory, instruments, documents and
intellectual property of the Borrower and each of the Guarantors (including,
without limitation, patents, copyrights, trademarks, franchises and goodwill),
in each case as provided in the Security Documents; the Canton Cast-Roll
Facility; the outstanding stock or other equity interests of the Borrower and
its Subsidiaries; and all general intangibles related to the foregoing and all
other properties, rights and assets of the Borrower or any Guarantor that are or
that are intended to be subject to the security interests and mortgages created
by the Security Documents, including without limitation, deposit accounts and
short term investments as described in the Security Documents; and all proceeds
and products of the foregoing.
COMMITMENT. With respect to each Lender, the amount set forth on
SCHEDULE 1 hereto as the amount of such Lender's commitment to make Revolving
Credit Loans to the Borrower, up to a total aggregate principal amount
outstanding for all Lenders not to exceed the lesser of (i) $420,000,000 and
(ii) the amount approved in the Interim Order or the Final Order, whichever is
in effect at the time of reference thereto, as the same may be reduced from time
to time; or, if such commitment is terminated pursuant to the provisions hereof,
zero.
COMMITMENT PERCENTAGE. With respect to each Lender, the percentage set
forth on SCHEDULE 1 hereto as such Lender's percentage of the aggregate
Commitments of all of the Lenders, as such percentages may be adjusted for
assignments from time to time.
COMPLIANCE CERTIFICATE. See Section 8.4(d).
CONCENTRATION ACCOUNT. Account #531-32381 maintained by Fleet National
Bank in the name of the Borrower.
CONSOLIDATED OR CONSOLIDATED. With reference to any term defined
herein, shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with generally accepted accounting
principles.
CONSOLIDATED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND
AMORTIZATION OR EBITDA. With respect to the Borrower and its Subsidiaries for
any period, the Consolidated Net Income of the Borrower and its Subsidiaries for
such period, after all expenses and other proper charges, PLUS, without
duplication and to the extent deducted from the calculation of Consolidated Net
Income for such period (a) payment or provision for any income and other taxes
based on income for such period, (b) interest expense for such period, (c)
depreciation and amortization for such period, (d) pension curtailment and
severance expenses and other pension and post-retirement benefit expenses, (e)
losses from the sale of non-operating assets permitted under the Credit
Agreement, for such period, and (f) accrued noncash expenses for such period in
respect of monitoring fees payable to Blackstone, Veritas, USX and Kobe Steel
Ltd. and their respective Affiliates, MINUS without duplication and to the
extent included in the
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calculation of Consolidated Net Income for such period, gains from the sale of
non-operating assets permitted under the Credit Agreement, in each case
determined on a consolidated basis for the Borrower and its Subsidiaries in
accordance with generally accepted accounting principles.
CONSOLIDATED NET INCOME. With respect to the Borrower and its
Subsidiaries for any period, the consolidated net income (or deficit) of the
Borrower and its Subsidiaries for such period, after deduction of all expenses,
taxes, and other proper charges, including, without limitation, minority
interest, determined on a consolidated basis for such Persons in accordance with
generally accepted accounting principles, after eliminating therefrom all
extraordinary nonrecurring items of income or loss (subtracting, in the case of
income and adding, in the case of loss), PROVIDED that there shall be no
elimination of losses or one-time provisions to the extent the same shall result
in cash expenditures in such period or relate to anticipated cash expenditures
in a future period.
CONVERSION REQUEST. A notice given by the Borrower to the
Administrative Agent of the Borrower's election to convert or continue a
Revolving Credit Loan in accordance with Section 2.7.
CREDIT AGREEMENT. This Debtor-in-Possession Revolving Credit Agreement,
including the Schedules and Exhibits hereto, all as amended and in effect from
time to time.
CREDITORS' COMMITTEES. Collectively, the Unsecured Creditors' Committee
and the Noteholders' Committee, if any.
DEFAULT. See Section 13.1.
DELINQUENT LENDER. See Section 15.5.3.
DISTRIBUTION. With respect to any Person, the declaration or payment of
any dividend on or in respect of any shares of any class of capital stock,
membership interests or other equity interests of such Person, other than
dividends payable solely in shares of common equity interests of such Person;
the purchase, redemption, or other retirement of, any shares of any class of
capital stock, membership interests or other equity interests of such Person,
directly or indirectly through a Subsidiary of such Person or otherwise; the
return of capital by such Person to its shareholders or other equity holders as
such; or any other distribution on or in respect of any shares of any class of
capital stock, membership interests or other equity interests of such Person.
DOLLAR EQUIVALENT. With respect to an amount of Canadian Dollars on any
date, the amount of Dollars that may be purchased with such amount of Canadian
Dollars at the Exchange Rate; with respect to an amount of Dollars on any date,
such amount in Dollars.
DOLLARS OR $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Lender
designated as such in SCHEDULE 1 hereto; thereafter, such other office of such
Lender, if any, located within the United States that will be making or
maintaining Base Rate Loans.
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DOMESTIC SECURITY AGREEMENT. The Security Agreement dated as of the
date hereof and as amended and in effect from time to time, among the Borrower,
the Guarantors other than Canadian Drawn Steel Company and the Administrative
Agent.
DRAWDOWN DATE. The date on which any Revolving Credit Loan is made or
is to be made, and the date on which any Revolving Credit Loan is converted or
continued in accordance with Section 2.7.
EFFECTIVE DATE. The first date on which all of the conditions set forth
in Section 11 and Section 12 have been satisfied or waived in writing by each of
the Lenders and any Revolving Credit Loans are to be made or any Letter of
Credit is to be issued hereunder.
ELIGIBLE ACCOUNTS RECEIVABLE. On any date, the Dollar Equivalent of the
aggregate of the unpaid portions of Accounts Receivable (net of any credits,
setoffs, deductions, discounts, counterclaims, rebates, offsets, holdbacks,
contras or other adjustments or commissions payable to third parties that are
adjustments to such Accounts Receivable) as to which the Borrower has furnished
reasonably detailed information to the Lenders in a Borrowing Base Report (i)
that the Borrower reasonably and in good faith determines to be collectible;
(ii) that are with account debtors that (A) (x) are not factors or Affiliates of
the Borrower or (y) are American Axle or USX or other Affiliates approved by the
Administrative Agent (each of American Axle and USX and such other approved
Affiliates being an "EXEMPTED AFFILIATE") and the Administrative Agent has
received an executed letter in form and substance satisfactory to the
Administrative Agent from such Exempted Affiliate, as to the arms-length nature
of the transaction giving rise to the Account Receivable owed by such Exempted
Affiliate, waiving set-off rights and containing such other provisions as the
Administrative Agent may reasonably require, (B) purchased the goods or services
giving rise to the relevant Account Receivable in an arm's length transaction,
(C) are not insolvent or involved in any case or proceeding, whether voluntary
or involuntary, under any bankruptcy, reorganization, arrangement, insolvency,
adjustment of debt, dissolution, liquidation or similar law of any jurisdiction
and (D) are, in the Administrative Agent's reasonable judgment, creditworthy (in
the event the Administrative Agent determines that any account debtor is not
creditworthy, the Administrative Agent shall endeavor to notify the Borrower as
to such account debtor); (iii) that are in payment of obligations that have been
fully performed, do not consist of progress xxxxxxxx or xxxx and hold invoices
and are not subject to dispute, or any other similar claims that would reduce
the cash amount payable therefor; (iv) that are not subject to any pledge,
restriction, security interest or other lien or encumbrance other than those
created by the Loan Documents; (v) in which the Administrative Agent has a valid
and perfected first priority security interest; (vi) that are neither more than
sixty (60) days past due under the original terms of the sale nor outstanding
more than ninety (90) days past the invoice date therefor; (vii) that are not
due from an account debtor located in Minnesota unless the Borrower (A) has
received a certificate of authority to do business and is in good standing in
such state or (B) has filed a notice of business activities report with the
appropriate office or agency of such state for the current year; (viii) that are
not due from any single account debtor if more than fifty percent (50%) of the
aggregate amount of all Accounts Receivable owing from such account debtor would
otherwise not be Eligible Accounts Receivable; (ix) that are payable in Dollars
or Canadian Dollars; (x) that are not due from the United States of America or
any department, agency or instrumentality thereof, except for those Accounts
Receivable for which the Borrower or its Subsidiaries has complied with the
Federal
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Assignment of Claims Act; (xi) that are not with account debtors whose
obligation to pay is conditional or subject to a repurchase obligation or right
to return, including xxxx and hold sales, guaranteed sales, sale or return
transactions, sales on approval or consignment sales; (xii) that are not due
from any single account debtor to the extent that after giving effect to the
inclusion of such Accounts Receivable (or a portion thereof) in the Borrowing
Base more than twenty percent (20%) of the Eligible Accounts Receivable included
in the Borrowing Base are owed by such account debtor and (xiii) that are not
payable from an office outside of the United States or Canada unless such
account debtor has provided to the Borrower an irrevocable letter of credit from
a financial institution reasonably satisfactory to the Administrative Agent to
secure such account debtor's obligations to the Borrower (but only to the extent
of the amount of such letter of credit and such Letter of Credit is immediately
assigned to, and delivered into the possession of, the Administrative Agent).
ELIGIBLE ASSIGNEE. Any of (a) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $1,000,000,000; (b) a
savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a
net worth of at least $100,000,000, calculated in accordance with generally
accepted accounting principles; (c) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having total assets in excess of $1,000,000,000, PROVIDED that such
bank is acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the OECD; (d) the central
bank of any country which is a member of the OECD; and (e) any other bank,
insurance company, commercial finance company or other financial institution
approved by the Administrative Agent, such approval not to be unreasonably
withheld.
ELIGIBLE FINISHED GOODS INVENTORY. On any date, with respect to the
Borrower and the Subsidiary Guarantors, the Dollar Equivalent of the gross book
value, determined in accordance with the first-in, first-out method of inventory
accounting, as reflected on the Borrower's or a Subsidiary Guarantor's books in
accordance with generally accepted accounting principles consistently applied,
of finished goods inventory owned by the Borrower or the Subsidiary Guarantors
and as to which the Borrower has furnished reasonably detailed information to
the Lenders in a Borrowing Base Report; PROVIDED that Eligible Inventory shall
not include any inventory (i) held on consignment by the Borrower or one of the
Subsidiary Guarantors, or not otherwise owned by the Borrower or the Subsidiary
Guarantors, or of a type no longer sold by the Borrower or the Subsidiary
Guarantors, (ii) which has been returned by a customer and is not in saleable
condition or is damaged or subject to any legal encumbrance, (iii) which is not
located on property owned by the Borrower or one of the Subsidiary Guarantors
unless such inventory is (A) held by the Borrower or a Subsidiary Guarantor on
properties leased by the Borrower or the Subsidiary Guarantors as to which the
Administrative Agent has received a waiver from the lessor of such property in
form and substance satisfactory to the Administrative Agent, unless the relevant
date of determination is on or prior to thirty (30) days after the Effective
Date, (B) not in the possession of the Borrower or the Subsidiary Guarantors and
is not in transit and (x) the Administrative Agent has received a waiver from
the party in possession of such inventory in form and substance satisfactory to
the Administrative Agent, (y) the Administrative Agent has reduced the value of
such inventory by reserves reasonably
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deemed adequate by the Administrative Agent, and in any event in an amount equal
to all obligations of the Borrower and its Subsidiaries to the party in
possession or (z) the relevant date of determination is prior to thirty (30)
days after the Effective Date or (C) in transit from one location in which the
Administrative Agent had a perfected security interest in such inventory to a
second location where the Administrative Agent has taken all steps necessary to
obtain a perfected security interest in inventory at such location, and has been
in transit for a period of less than ten (10) days, (iv) as to which the
Administrative Agent does not have a valid and perfected first priority security
interest, (v) which is not located within the United States of America or
Canada, (vi) which the Administrative Agent reasonably deems to be obsolete or
not marketable, (vii) which constitutes supplies or spare parts of the Borrower
or its Subsidiaries, or (viii) which constitutes, railroad inventory or
conversion inventory, in each case as such is reflected on the Borrower's books.
Finished goods inventory immediately loses the status of Eligible Finished Goods
Inventory if and when the Borrower or one of the Subsidiary Guarantors sells it,
otherwise passes title thereto, or consumes it or the Administrative Agent
releases or transfers its security interest therein, or if and when an Eligible
Account Receivable arises by virtue of constituting proceeds of such inventory.
Notwithstanding the foregoing, but without duplication, Eligible Finished Goods
Inventory shall be reduced by the amount of any specific reserve established by
the Borrower with respect to any Eligible Finished Goods Inventory other than
the LIFO reserve maintained by the Borrower in accordance with generally
accepted accounting principles.
ELIGIBLE FIXED ASSET CAP. With respect to any period, the amount set
forth below opposite such period, PROVIDED, HOWEVER that (a) the Eligible Fixed
Asset Cap may be permanently reduced to $0 as provided in Section 3.2(b) of the
Credit Agreement or otherwise pursuant to the terms of the Credit Agreement and
(b) the Eligible Fixed Asset Cap may be permanently reduced during one of the
periods set forth below by such amounts as are provided in Section 3.2(b) of the
Credit Agreement, in which case the amount set forth below opposite such period
and each other amount set forth below opposite each subsequent period shall be
reduced by an amount equal to such reduction.
------------------------------------------------------------ --------------------------------------------
PERIOD: ELIGIBLE FIXED ASSET CAP:
------------------------------------------------------------ --------------------------------------------
Effective Date through December 31, 2001 $100,000,000
------------------------------------------------------------ --------------------------------------------
January 1, 2002 through February 28, 2002 $97,000,000
------------------------------------------------------------ --------------------------------------------
Thereafter $92,000,000
------------------------------------------------------------ --------------------------------------------
Reductions of the Eligible Fixed Asset Cap pursuant to this definition
or otherwise are permanent; once reduced, the Eligible Fixed Asset Cap may not
be increased.
ELIGIBLE FIXED ASSETS. The appraised liquidation in-place value of the
Canton Cast-Roll Facility and the related Real Estate located in Canton, Ohio
based on the Updated Appraisal, or any later such liquidation in-place appraisal
obtained by the Administrative Agent pursuant to Section 8.4(n) in which the
Administrative Agent, for the benefit of the Lenders, has a first priority
perfected security interest, as determined by the Administrative Agent at the
Borrower's expense, PROVIDED FURTHER that in no event shall the amount of the
Borrowing Base allocable to Eligible Fixed Assets exceed the Eligible Fixed
Asset Cap.
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ELIGIBLE INVENTORY. Eligible Finished Goods Inventory, Eligible
Work-in-Process and Eligible Raw Materials.
ELIGIBLE RAW MATERIALS. On any date, an amount equal to the Dollar
Equivalent of the gross book value, determined in accordance with the first-in,
first-out method of inventory accounting, as reflected on the Borrower's or a
Subsidiary Guarantor's books in accordance with generally accepted accounting
principles consistently applied, of raw materials used to produce the Borrower's
or one of the Subsidiary Guarantor's inventory, including any finished goods
inventory returned by a customer or no longer sold by the Borrower or the
Subsidiary Guarantors and (a) which has been converted into Eligible Raw
Materials, (b) which is (i) located on property owned by the Borrower or the
Subsidiary Guarantors, (ii) held by the Borrower or a Subsidiary Guarantor on
properties leased by the Borrower or the Subsidiary Guarantors as to which the
Administrative Agent has received a waiver from the lessor of such property in
form and substance satisfactory to the Administrative Agent, unless the relevant
date of determination is on or prior to thirty (30) days after the Effective
Date, (iii) not in the possession of the Borrower or the Subsidiary Guarantors
and is not in transit and (X) the Administrative Agent has received a waiver
from the party in possession of such inventory in form and substance
satisfactory to the Administrative Agent, (Y) the Administrative Agent has
reduced the value of such inventory by reserves reasonably deemed adequate by
the Administrative Agent, and in any event in an amount equal to all obligations
of the Borrower and its Subsidiaries to the party in possession or (Z) the
relevant date is on prior to thirty (30) days after the Effective Date or (iv)
is in transit from one location in which the Administrative Agent had a
perfected security interest in such inventory to a second location where the
Administrative Agent has taken all steps necessary to obtain a perfected
security interest in inventory at such location, and has been in transit for a
period of less than ten (10) days, (c) as to which the Borrower or one of the
Subsidiary Guarantors has acquired title and the Administrative Agent has a
valid and perfected first-priority security interest under all applicable law,
and (d) as to which the Borrower has furnished reasonably detailed information
to the Lenders in a Borrowing Base Report, after taking into account all charges
and liens (other than those of the Administrative Agent and carrier, warehouse,
customs and similar statutory liens arising in the ordinary course of business)
of all kinds against such raw materials. Without limiting the generality of the
foregoing, Eligible Raw Materials shall not include any raw materials covered by
a document of title until the document of title has been delivered to the
Administrative Agent or which the Administrative Agent reasonably deems to be
obsolete or not useable raw materials. Raw material immediately loses the status
of Eligible Raw Material if and when the Borrower or one of the Subsidiary
Guarantors sells it, otherwise passes title thereto, consumes it, or materially
changes it in the course of processing the same, or the Administrative Agent
releases or transfers its security interest therein. Notwithstanding the
foregoing, but without duplication, Eligible Raw Materials shall be reduced by
the amount of any specific reserve established by the Borrower with respect to
any Eligible Raw Materials other than the LIFO reserve maintained by the
Borrower in accordance with generally accepted accounting principles.
ELIGIBLE WORK-IN-PROCESS On any date, an amount equal to the Dollar
Equivalent of the gross book value, as reflected on the Borrower's or a
Subsidiary Guarantor's books in accordance with generally accepted accounting
principles consistently applied, of usable work-in-process of the Borrower and
the Subsidiary Guarantors and as to which the Borrower has
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furnished reasonably detailed information to the Lenders in a Borrowing Base
Report in connection with the manufacture of its products in the ordinary course
of its business, including any finished goods inventory returned by a customer
or no longer sold by the Borrower or the Subsidiary Guarantors and which has
been converted into Eligible Work-in-Process, which is (a) (i) located on
property owned by the Borrower or the Subsidiary Guarantors, (ii) held by the
Borrower or a Subsidiary Guarantor on properties leased by the Borrower or the
Subsidiary Guarantors as to which the Administrative Agent has received a waiver
from the lessor of such property in form and substance satisfactory to the
Administrative Agent, unless the relevant date of determination is on or prior
to thirty (30) days after the Effective Date, (iii) not in the possession of the
Borrower or the Subsidiary Guarantors and is not in transit and (X) the
Administrative Agent has received a waiver from the party in possession of such
inventory in form and substance satisfactory to the Administrative Agent, (Y)
the Administrative Agent has reduced the value of such inventory by reserves
reasonably deemed adequate by the Administrative Agent, and in any event in an
amount equal to all obligations of the Borrower and the Subsidiary Guarantors to
the party in possession or (Z) the relevant date of determination is on or prior
to thirty (30) days after the Effective Date or (iv) is in transit from one
location in which the Administrative Agent had a perfected security interest in
such inventory to a second location where the Administrative Agent has taken all
steps necessary to obtain a perfected security interest in such inventory at
such location, and has been in transit for a period of less than ten (10) days,
and (b) as to which the Borrower or one of the Subsidiary Guarantors has title
and the Administrative Agent has a valid and perfected first-priority security
interest. Without limiting the generality of the foregoing, Eligible
Work-in-Process shall not include work-in-process which the Administrative Agent
reasonably deems to be obsolete or not marketable. Work-in-process immediately
loses the status of Eligible Work-in-Process if and when the Borrower or one of
the Subsidiary Guarantors sells it, otherwise passes title thereto, consumes it,
or the Administrative Agent releases or transfers its security interest therein.
Notwithstanding the foregoing, but without duplication, Eligible Work-in-Process
shall be reduced by the amount of any specific reserves established by the
Borrower with respect to any Eligible Work-in-Process other than the LIFO
reserve maintained by the Borrower in accordance with generally accepted
accounting principles.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.
ENVIRONMENTAL LAWS. See Section 7.16(a).
ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time.
ERISA AFFILIATE. Any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required
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to maintain reserves under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor or similar regulations relating to such reserve
requirements) against "EUROCURRENCY LIABILITIES" (as that term is used in
Regulation D), if such liabilities were outstanding. The Eurocurrency Reserve
Rate shall be adjusted automatically on and as of the effective date of any
change in the Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Administrative Agent
in its sole discretion acting in good faith.
EURODOLLAR LENDING OFFICE. Initially, the office of each Lender
designated as such in SCHEDULE 1 hereto; thereafter, such other office of such
Lender, if any, that shall be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (a) the arithmetic average of the rates
per annum for each Reference Lender (rounded upwards to the nearest 1/16 of one
percent) of the rate at which such Reference Lender's Eurodollar Lending Office
is offered Dollar deposits two (2) Eurodollar Business Days prior to the
beginning of such Interest Period in the interbank eurodollar market where the
eurodollar and foreign currency and exchange operations of such Eurodollar
Lending Office are customarily conducted, for delivery on the first day of such
Interest Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Rate Loan of such Reference Lender to
which such Interest Period applies, divided by (b) a number equal to 1.00 minus
the Eurocurrency Reserve Rate, if applicable.
EURODOLLAR RATE LOANS. Revolving Credit Loans bearing interest
calculated by reference to the Eurodollar Rate.
EVENT OF DEFAULT. See Section 13.1.
EXCESS AVAILABILITY. As of any date of determination, the result of (a)
the Availability as of such date, MINUS (b) the sum of (i) the outstanding
amount of the Revolving Credit Loans as of such date PLUS (ii) the Maximum
Drawing Amount PLUS (iii) all Unpaid Reimbursement Obligations.
EXCHANGE RATE. With respect to any amount in Dollars the rate of
exchange as quoted by the Bank of Canada as the noon rate of Canadian Dollars
for Dollars on or about 12:00 p.m. (noon) Toronto time on the Business Day on
which the determination is required to be made.
FILING DATE. See preamble.
FINAL ORDER. See Section 12.5.
FLEET. See preamble.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. (a) When used in Section 10,
whether directly or indirectly through reference to a capitalized term used
therein, means (i) principles that are
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consistent with the principles promulgated or adopted by the Financial
Accounting Standards Board and its predecessors, in effect on the Balance Sheet
Date, and (ii) to the extent consistent with such principles, the accounting
practice of the Borrower reflected in its financial statements for the year
ended on the Balance Sheet Date, and (b) when used in general, other than as
provided above, means principles that are (i) consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, as in effect from time to time, and (ii) consistently applied with
past financial statements of the Borrower adopting the same principles, PROVIDED
that in each case referred to in this definition of "generally accepted
accounting principles" a certified public accountant would, insofar as the use
of such accounting principles is pertinent, be in a position to deliver an
unqualified opinion (other than a qualification regarding changes in generally
accepted accounting principles) as to financial statements in which such
principles have been properly applied.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate the benefits of which are guaranteed on termination in full
or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
GUARANTY. The Guaranty made by the Guarantors in favor of the Lenders
and the Administrative Agent pursuant to Section 6.2 hereof, pursuant to which
the Guarantors guaranty to the Lenders and the Administrative Agent the payment
and performance of the Obligations.
GUARANTORS. Collectively, the Parent Guarantor and the Subsidiary
Guarantors.
HAZARDOUS SUBSTANCES. See Section 7.16(b).
IDENTIFIED EVENT OF DEFAULT. Any Event of Default under any of Sections
13.1(a) or (b), unless in either of such cases, such Event of Default results
solely from acceleration of the Obligations due to the occurrence of an Event of
Default not constituting an Identified Event of Default, and any Event of
Default under any of Sections 13.1(h)(i), (j), (l), (m), (o), (p)(ii) or (iii),
(r), (v)(ii) or (iii) or (w) (if such action or suit under clause (w) is
commenced, directly or indirectly, by the Borrower or any Guarantor).
INDEBTEDNESS As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(i) every obligation of such Person for money borrowed,
(ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments,
(iii) every reimbursement obligation of such Person with respect to
letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person,
(iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (including securities repurchase
agreements but excluding trade accounts payable existing on the Effective Date,
or trade accounts payable or accrued liabilities
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arising in the ordinary course of business which are not overdue by more than
ninety (90) days or which are being contested in good faith),
(v) every obligation of such Person under any Capitalized Lease,
(vi) every obligation of such Person under any lease (a "synthetic
lease") treated as an operating lease under generally accepted accounting
principles and as a loan or financing for U.S. income tax purposes,
(vii) all sales by such Person of (A) accounts or general intangibles
for money due or to become due (other than general intangibles related to assets
disposed of in accordance with this Agreement and the other Loan Documents), (B)
chattel paper, instruments or documents creating or evidencing a right to
payment of money or (C) other receivables (collectively "receivables"), whether
pursuant to a purchase facility or otherwise, other than in connection with the
disposition of the business operations of such Person relating thereto or a
disposition of defaulted receivables for collection and not as a financing
arrangement, and together with any obligation of such Person to pay any
discount, interest, fees, indemnities, penalties, recourse, expenses or other
amounts in connection therewith,
(viii) every obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or arrangement
(including, without limitation, caps, floors, collars and similar agreements),
the value of which is dependent upon interest rates, currency exchange rates,
commodities or other indices (a "derivative contract"),
(ix) every obligation in respect of Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent that such Person is liable therefor as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent that the terms of such Indebtedness provide that such Person is not
liable therefor and such terms are enforceable under applicable law,
(x) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guarantying or otherwise acting
as surety for, any obligation of a type described in any of clauses (i) through
(x) (the "primary obligation") of another Person (the "primary obligor"), in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person (A) to purchase or pay (or advance or supply funds for
the purchase of) any security for the payment of such primary obligation, (B) to
purchase property, securities or services for the purpose of assuring the
payment of such primary obligation, or (C) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such primary obligation.
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (u) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with generally accepted
accounting principles, (v) any Capitalized Lease shall be the principal
component of the aggregate of the rentals obligation under such Capitalized
Lease payable over the term thereof that is not subject to termination by the
lessee, (w) any sale of receivables shall be the amount of unrecovered capital
or principal investment of the purchaser (other than the
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Borrower or any of its wholly-owned Subsidiaries) thereof, excluding amounts
representative of yield or interest earned on such investment, (x) any synthetic
lease shall be the stipulated loss value, termination value or other equivalent
amount, and (y) any derivative contract shall be the maximum amount of any
termination or loss payment required to be paid by such Person if such
derivative contract were, at the time of determination, to be terminated by
reason of any event of default or early termination event thereunder, whether or
not such event of default or early termination event has in fact occurred.
INDENTURE. The Indenture, dated as of August 13, 1999, among the
Borrower, RTI Capital and the Trustee, pursuant to which the Notes are issued,
in the form delivered to the Agents on or prior to August 13, 1999.
INELIGIBLE PROFESSIONAL EXPENSES. Fees or expenses incurred by any
Person, including the Creditors' Committees, the Borrower or any Guarantor in
(A) preventing, hindering or delaying the Lenders' or the Agents' enforcement or
realization upon any of the Collateral once an Event of Default has occurred,
(B) using or seeking to use cash collateral or selling any other Collateral
without the Agents' consent, (C) incurring Indebtedness without the Agents'
consent and (D) objecting to or contesting in any manner, or in raising any
defenses to, the validity, extent, amount, perfection, priority or
enforceability of the Prepetition Bank Debt or the Obligations or any mortgages,
liens or security interests with respect thereto or any other rights or
interests of the Agents and the Lenders, or in asserting any claims or causes of
action, including, without limitation, any actions under Chapter 5 of the
Bankruptcy Code, against the Agents or the Lenders.
INTERCREDITOR AGREEMENTS. The Pledge Intercreditor Agreement and the
Other Asset Intercreditor Agreement.
INTEREST PAYMENT DATE. (a) As to any Base Rate Loan, the first day of
the calendar month with respect to interest accrued during the immediately
preceding calendar month, including, without limitation, the calendar MONTH
which includes the Drawdown Date of such Base Rate Loan; (or if such day is not
a Business Day, then the next immediately following Business Day); and (b) as to
any Eurodollar Rate Loan in respect of which the Interest Period is (i) one (1)
month, the last day of such Interest Period and (ii) more than one (1) month,
the date that is one (1) month from the first day of such Interest Period, each
one (1) month period thereafter, and, in addition, the last day of such Interest
Period.
INTEREST PERIOD. With respect to each Revolving Credit Loan, (a)
initially, the period commencing on the Drawdown Date of such Loan and ending
on, (i) for any Base Rate Loan, the last day of the calendar month; and (ii) for
any Eurodollar Rate Loan, the last day of the 1, 2, 3, or 6 month period as
selected by the Borrower in a Loan Request; and (b) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Revolving Credit Loan and ending on the last day of the next calendar month
for any Base Rate Loan and the last day of one of the periods set forth above,
as selected by the Borrower in a Conversion Request, for any Eurodollar Rate
Loan; PROVIDED that all of the foregoing provisions relating to Interest Periods
are subject to the following:
(a) if any Interest Period with respect to a Eurodollar Rate Loan would
otherwise end on a day that is not a Eurodollar Business Day, that Interest
Period shall be extended to the
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next succeeding Eurodollar Business Day unless the result of such extension
would be to carry such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(b) if any Interest Period with respect to a Base Rate Loan would end
on a day that is not a Business Day, that Interest Period shall end on the next
succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in Section
2.7, the Borrower shall be deemed to have requested a conversion of the affected
Eurodollar Rate Loan to a Base Rate Loan and the continuance of all Base Rate
Loans as Base Rate Loans on the last day of the then current Interest Period
with respect thereto;
(d) any Interest Period relating to any Eurodollar Rate Loan that
begins on the last Eurodollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the end
of such Interest Period) shall end on the last Eurodollar Business Day of a
calendar month; and
(e) any Interest Period relating to any Eurodollar Rate Loan that would
otherwise extend beyond the Termination Date shall end on the Termination Date.
INTERIM ORDER. An order of the Bankruptcy Court in the Cases
authorizing and approving this Credit Agreement on an interim basis under
Section 364(c) and (d) of the Bankruptcy Code and entered at a preliminary
hearing under Bankruptcy Rule 4001, in form and substance satisfactory to the
Agents and Administrative Agent's Special Counsel and the Borrower and its
counsel. The Interim Order shall, among other things, (i) have authorized (A)
the borrowing of the Revolving Credit Loans and the repayment of the Prepetition
Bank Debt, (B) the rollover of the Rollover LC's pursuant to this Credit
Agreement, and (C) the borrowing of not more than $13,775,000 in Revolving
Credit Loans, and granted the claim status and Liens described in Section 6.1
(including, without limitation, the liens granted pursuant to the Master Pledge
Agreement), and prohibited the granting of additional Liens on the assets of the
Borrower and its Subsidiaries, (ii) provide that such Liens are automatically
perfected by the entry of the Interim Order and also grant to the Administrative
Agent for the benefit of the Agents and the Lenders relief from the automatic
stay of Section 362(a) of the Bankruptcy Code to enable the Agents, if the
Agents or the Majority Lenders elect to do so in their discretion, to make all
filings and recordings and to take all other actions considered necessary or
advisable by the Agents or the Majority Lenders to perfect, protect and insure
the priority of its Liens upon the Collateral as a matter of nonbankruptcy law,
(iii) find that the Lenders are extending credit to the Borrower in good faith
pursuant to Section 364(e) of the Bankruptcy Code, (iv) provide for the
preservation of certain challenges to the Prepetition Credit Agreement but
subject to the requirement that any such challenges (A) by the Unsecured
Creditors' Committee be commenced no later than the date which falls on the 60th
day following the appointment of the Unsecured Creditors' Committee (or if such
day is not a Business Day, on the next succeeding Business Day) and (B) by any
other Person be commenced no later than the date which falls on the 60th day
following the Filing Date (or if such day is not a Business Day, on the next
succeeding Business Day), and (v) be in full force and effect.
INTERNATIONAL STANDBY PRACTICES. With respect to any standby Letter of
Credit, International Standby Practices (ISP98), International Chamber of
Commerce Publication No.
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590, or any successor code of standby letter of credit practices among banks
adopted by the Administrative Agent in the ordinary course of its business as a
standby letter of credit issuer and in effect at the time of issuance of such
Letter of Credit.
INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock, other equity interests
or Indebtedness of, or for loans, advances, capital contributions or transfers
of property for a similar purpose to, or in respect of any guaranties of (or
other commitments as described under Indebtedness), or obligations of, any
Person. In determining the aggregate amount of Investments outstanding at any
particular time: (a) the amount of any Investment represented by a guaranty
shall be taken at not less than the principal amount of the obligations
guaranteed and still outstanding, except that if such guaranty is limited in
amount, the amount of such Investment shall be equal to the amount to which such
guaranty is limited; (b) there shall be deducted in respect of each such
Investment any amount received as a return of capital (but only by repurchase,
redemption, retirement, repayment, dividend or distribution); (c) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise; and (d) there
shall not be deducted from the aggregate amount of Investments any decrease in
the value thereof.
ISSUING BANK. Fleet or any of its affiliates.
JUNIOR SUBORDINATED INDEBTEDNESS. Indebtedness incurred pursuant to
the Subordinated Loan Documents, and subject to subordination provisions
contained therein, and secured only by a silent subordinated lien on the Canton
Cast-Roll Facility pursuant to the Subordinated Mortgage.
LENDERS. See preamble.
LETTER OF CREDIT. See Section 4.1.1.
LETTER OF CREDIT APPLICATION. See Section 4.1.1.
LETTER OF CREDIT FEE. See Section 4.6.
LETTER OF CREDIT PARTICIPATION. See Section 4.1.4.
LOAN DOCUMENTS. This Credit Agreement, the Revolving Credit Notes, the
Letter of Credit Applications, the Letters of Credit, the Intercreditor
Agreements, the Security Documents and the Rate Protection Agreements.
LOAN REQUEST. See Section 2.6.
MAJORITY LENDERS. As of any date, the Lenders holding at least
sixty-seven percent (67%) of the outstanding principal amount of the Revolving
Credit Notes on such date; and if no such principal is outstanding, the Lenders
whose aggregate Commitments constitute more than sixty-seven percent (67%) of
the Total Commitment, PROVIDED, that the Majority Lenders shall in any event
include at least three (3) or more Lenders which are not Agents.
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MASTER PLEDGE AGREEMENT. The Master Pledge Agreement, dated as of
August 13, 1999, made by the Borrower, the Parent and the other "Pledgors" named
therein in favor of the United States Trust Company of New York as collateral
agent for the benefit of the Lenders, the Administrative Agent, the Trustee and
the other "Secured Parties" named therein.
MATERIAL ADVERSE EFFECT. A material adverse effect on the consolidated
assets, business, condition (financial or otherwise) or operations of the
Borrower or on the Borrower's ability to perform its material Obligations under
the Loan Documents or the Lenders' and the Administrative Agent's material
rights under the Loan Documents.
MAXIMUM DRAWING AMOUNT. The maximum aggregate amount from time to time
that the beneficiaries are or may become entitled to draw under issued and
outstanding Letters of Credit, as such aggregate amount may be reduced from time
to time pursuant to the terms of the Letters of Credit.
MORTGAGED PROPERTY. The real estate and fixtures related to the Canton
Cast-Roll Facility and subject to the Mortgage and any related properties,
rights and assets subject to the Mortgage.
MORTGAGE. The mortgage, dated or to be dated on or prior to the
Effective Date, from the Borrower to the Administrative Agent for the benefit of
the Lenders with respect to the Mortgaged Property and in form and substance
satisfactory to the Lenders and the Administrative Agent.
MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.
NET CAPITAL EXPENDITURES. Capital Expenditures that are not made from
the proceeds of Indebtedness permitted by Section 9.1.
NET CASH PROCEEDS. In connection with any sale or other disposition of
assets, any issuance of equity, any incurrence of New Permitted Off-Balance
Sheet Financing or any incurrence of Indebtedness after the Effective Date, the
cash proceeds received from such sale, disposition, issuance or incurrence, net
of all customary and reasonable costs of sale, underwriting or brokerage costs,
fees, commissions, costs, expenses, and taxes paid or payable as a result
thereof (including resulting income tax distributions of the type described in
Section 9.4(d)) by the Borrower or any of its Subsidiaries, including, without
limitation, attorneys' fees, survey costs, title insurance premiums, and related
search and recording charges, transfer taxes and deed or mortgage recording
taxes, and, in the case of any sale or other disposition of assets, after the
satisfaction of all Indebtedness and other obligations permitted hereby and
secured by such assets or required to by paid upon the sale of such assets.
NON-AFFECTED LENDER. See Section 5.11.
NOTE DOCUMENTS. The Notes, the Indenture and all documents, instruments
and agreements executed in connection therewith, each in the form delivered to
the Agents on or prior to the Effective Date.
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NOTEHOLDERS' COMMITTEE. The Official Noteholders' Committee (if any) to
be organized by the United States Trustee and approved in relation to the Cases.
NOTES. The 13 3/4% Senior Secured Notes, dated August 13, 1999, due
2009 issued by the Borrower and RTI Capital in the form delivered to the Agents
on or prior to the Effective Date.
OBLIGATIONS. All indebtedness, obligations and liabilities of any of
the Borrower and its Subsidiaries to any of the Lenders and/or the
Administrative Agent, individually or collectively, existing on the date of this
Credit Agreement or arising thereafter, direct or indirect, joint or several,
absolute or contingent, matured or unmatured, liquidated or unliquidated,
secured or unsecured, arising by contract, operation of law or otherwise
(including any indebtedness of Borrower incurred in connection with cash
management services provided by Fleet or Fleet National Bank), arising or
incurred under this Credit Agreement, any of the other Loan Documents, or in
respect of any of the Revolving Credit Loans made or Reimbursement Obligations
incurred, or any of the Revolving Credit Notes, Letter of Credit Application,
Letter of Credit, Rate Protection Agreements, or other instruments at any time
evidencing any thereof.
OPERATING ACCOUNT. The Borrower's operating account (No. 00000000)
maintained with Fleet National Bank.
OUTSTANDING. With respect to the Revolving Credit Loans, the aggregate
unpaid principal thereof as of any date of determination.
ORDERS. The Interim Order and the Final Order.
OTHER ASSET INTERCREDITOR AGREEMENT. The Amended and Restated
Intercreditor and Subordination Agreement, dated as of August 13, 1999, by and
among United States Trust Company of New York, as collateral agent and as
trustee, the "Pennsylvania Lenders", as defined therein, the Administrative
Agent, the Parent, the Borrower, RTI Capital and the other parties thereto.
PARENT. Republic Technologies International Holdings, LLC, a Delaware
limited liability company.
PARENT GUARANTY. The Guaranty contained in Section 6.2 hereof by the
Parent in favor of the Lenders and the Administrative Agent.
PATENT ASSIGNMENT. The Patent Collateral Assignment and Security
Agreement, of even date herewith, made by the Borrower in favor of the
Administrative Agent.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
PENNSYLVANIA INDEBTEDNESS. Section Indebtedness of the Borrower to the
Pennsylvania Lenders under the Pennsylvania Lenders Debt Instruments.
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PENNSYLVANIA LENDERS. The "Pennsylvania Lenders" as defined in the
Other Asset Intercreditor Agreement
PENNSYLVANIA LENDERS DEBT INSTRUMENTS. The "Pennsylvania Lenders Debt
Instruments" as defined in the Other Asset Intercreditor Agreement.
PERFECTION CERTIFICATES. The Perfection Certificates as defined in the
Security Agreements.
PERMITTED HOLDERS. (i) Blackstone Capital Partners II Merchant Banking
Fund L.P., a Delaware limited partnership, Blackstone Offshore Capital Partners
II L.P., a Cayman Islands exempted limited partnership, and Blackstone Family
Investment Partnership II L.P., a Delaware limited partnership, (ii) each
general partner of any of the foregoing who is a partner or employee of The
Blackstone Group L.P., (iii) USX Corporation, (iv) Kobe Steel, Ltd. and (v) any
Affiliate of the persons specified in clauses (i)-(iv) of this definition.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted by Section 9.2.
PERMITTED PRIOR LIENS. Valid, perfected and otherwise unavoidable Liens
existing as of the Filing Date and having, as of the Filing Date, priorities
over the Liens securing the Prepetition Bank Debt and Liens otherwise approved
in writing by the Agents.
PERSON. Any individual, corporation, partnership, limited liability
company, trust, unincorporated association, business, or other legal entity, and
any government or any governmental agency or political subdivision thereof.
XXXXX CASH ACCOUNTS. Those accounts listed and described on SCHEDULE
7.18 as xxxxx cash accounts.
PREPETITION BANK DEBT. All of the Obligations under and as defined in
the Prepetition Credit Agreement.
PREPETITION CREDIT AGREEMENT. See preamble.
PREPETITION DEBT OUTSTANDINGS. At any time of determination, the
outstanding amount of the Prepetition Bank Debt at such time, including without
limitation all principal, interest, fees (including any amendment fees), and
unreimbursed expenses.
PRIORITY PROFESSIONAL EXPENSES. Allowed and allowable and unpaid fees,
costs and reasonable expenses of professionals retained in the Cases pursuant to
Sections 327 and 1103 of the Bankruptcy Code consisting of any attorneys,
accountants, financial advisors, and consultants retained by the Borrower or the
Creditors' Committees; PROVIDED, HOWEVER, that (i) the term "Priority
Professional Expenses" shall not include any Ineligible Professional Expenses
and (ii) the amount of Priority Professional Expenses shall not exceed the
Professional Expense Cap.
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PRIORITY PROFESSIONAL EXPENSES RESERVE. As at any date of
determination, an amount equal to the Borrower's budgeted Priority Professional
Expenses contained in the Cash Budget for the month in which such date occurs
and the immediately following month.
PROFESSIONAL EXPENSE CAP. $6,000,000 in the aggregate (inclusive of any
holdbacks required by the Bankruptcy Court), PROVIDED HOWEVER, from and after
the occurrence of an Event of Default, all amounts expended for Priority
Professional Expenses shall reduce the Professional Expense Cap dollar for
dollar.
RATE PROTECTION AGREEMENTS. Any interest rate swap, cap, collar or
similar agreement or arrangement entered into, from time to time, by the
Borrower or any of its Subsidiaries which is a Guarantor and any of the Lenders
or any of their respective Affiliates to protect the Borrower or such Subsidiary
against fluctuations in interests rates on Indebtedness of such Borrower or such
Subsidiary permitted hereunder and as to which the Lender (or Affiliates) which
is a party thereto has provided notice to the Administrative Agent of such Rate
Protection Agreement's existence, type, notional amount, tenor and cost to
terminate.
RATE PROTECTION EXPOSURE. As of any date of determination, the net cost
to terminate all Rate Protection Agreements, marked to market no less frequently
than monthly, or more frequently if requested by the Administrative Agent.
REAL ESTATE. All real property at any time owned or leased (as lessee
or sublessee) by the Borrower or any of its Subsidiaries.
RECORD. The grid attached to a Revolving Credit Note, or the
continuation of such grid, or any other similar record, including computer
records, maintained by any Lender with respect to any Revolving Credit Loan
referred to in such Note.
REFERENCE LENDER. Fleet.
REFUNDING AMOUNT. See preamble.
REGISTER. See Section 19.3.
REIMBURSEMENT OBLIGATION. The Borrower's obligation to reimburse the
Administrative Agent and the Lenders on account of any drawing under any Letter
of Credit as provided in Section 5.2.
RENTAL OBLIGATIONS. All present or future obligations of the Borrower
or any of its Subsidiaries under any rental agreements or leases of real or
personal property, other than (a) obligations that can be terminated by the
giving of notice without liability to the Borrower or such Subsidiary in excess
of the liability for rent due within thirty (30) days of the date on which such
notice is given and under which no penalty or premium is paid as a result of any
such termination, and (b) obligations in respect of Capitalized Leases or any
synthetic leases referred to in clause (vi) of the definition of the term
"Indebtedness".
REORGANIZATION PLAN. A plan or plans of reorganization in the Cases.
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RESTRICTED PAYMENT. As to the Borrower and its Subsidiaries, (a) any
Distribution, (b) any payment or prepayment by the Borrower or its Subsidiaries
to the Parent or to any Affiliate of the Borrower or the Parent (other than a
payment to a Subsidiary of the Borrower which is a Guarantor or the Borrower) or
(c) any payment in respect of any Indebtedness which is subordinated in right of
payment by its terms to the repayment of the applicable Obligations.
RES HOLDING. RES Holding Corporation, a Delaware corporation.
REVOLVING CREDIT LOANS. Revolving credit loans made or to be made by
the Lenders to the Borrower pursuant to Section 2.
REVOLVING CREDIT NOTE RECORD. A Record with respect to a Revolving
Credit Note.
REVOLVING CREDIT NOTES. See Section 2.4.
ROLLOVER LC'S. Collectively, the letters of credit (including all
extensions and renewals thereof) issued by Fleet National Bank and Chase, as
issuing bank, under the Prepetition Credit Agreement.
RTI CAPITAL. RTI Capital Corp., a Delaware corporation.
RTII. Republic Technologies International, Inc., a Delaware
corporation.
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Lender, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible Securities.
SECURITY AGREEMENTS. The Domestic Security Agreement and the Canadian
Security Agreement.
SECURITY DOCUMENTS. The Security Agreements, the Master Pledge
Agreement, the Patent Assignment, the Trademark Assignment, the Mortgage and the
Agency Agreements.
SETTLEMENT. The making of, or receiving of payments, in immediately
available funds, by the Lenders, to the extent necessary to cause each Lender's
actual share of the outstanding amount of Revolving Credit Loans (after giving
effect to any Loan Request and including any Revolving Credit Loans made
pursuant to Section 2.6.2) to be equal to each Lender's Commitment Percentage of
the outstanding amount of such Revolving Credit Loans (after giving effect to
any Loan Request and including any Revolving Credit Loans made pursuant to
Section 2.6.2), where, prior to such event or action, the actual share is not so
equal.
SETTLEMENT AMOUNT. See Section 2.8.3.1.
SETTLING LENDER. See Section 2.8.3.1.
SETTLING DATE. A Settling Date shall occur upon any one or more of the
following: (a) the Drawdown Date of any Loan Request, (b) the last Business Day
of each calendar week, (c) any date on which the Borrower's Obligations to the
Administrative Agent in respect of Revolving
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Credit Loans made pursuant to Section 2.6.2 exceeds $15,000,000 and (d) more
frequently, if the Administrative Agent so designates to the Lenders from time
to time.
SPECIAL INVENTORY ADVANCE. During the period commencing on the
Effective Date through January 31, 2002, 10%; and thereafter, 5%, in each case,
of the lower of cost or market value of Eligible Inventory, up to a maximum
amount of $22,000,000 at any time.
SPECIALTY STEEL ASSETS. Those assets associated exclusively with the
Specialty Steel business of Republic Engineered Steels, Inc., including the
equipment of Xx. 0 Xxxx Xxxx xxx Xx. 0 Xxxxxxxx Xxxxxxxxxx in the Canton, Ohio
0xx Xxxxxx Plant, the equipment and property of the Canton, Ohio Harrison Road
Specialty Plant and the equipment and property of the Baltimore, Maryland
specialty steels plant.
SPECIFIED NON-CONSENTING LENDER. A Lender that shall have refused to
approve or consent to a waiver, consent or amendment hereunder or under the Loan
Documents which waiver, consent or amendment is, pursuant to Section 26,
approved by the Majority Lenders or such greater number of Lenders as are
required to cause such waiver, consent or amendment to be effective.
STOCK INTERCREDITOR AGREEMENT. That Pledge Intercreditor Agreement,
dated as of August 13, 1999, among the Administrative Agent, the Trustee and the
United States Trust Company of New York as collateral agent regarding the stock,
membership interests and other equity interests pledged pursuant to the Master
Pledge Agreement.
SUBORDINATED CREDIT AGREEMENT. The Subordinated Credit Agreement, dated
as of July 17, 2000, among the Borrower, the lenders party thereto and the agent
party thereto, and as thereafter amended or modified in a manner approved by the
Agents.
SUBORDINATED LOAN DOCUMENTS. The Subordinated Credit Agreement and
related "Notes", "Guaranty" and "Collateral Documents" (each as defined in the
Subordinated Credit Agreement), pursuant to which the Junior Subordinated
Indebtedness is issued and including, without limitation, the Subordinated
Mortgage securing the Junior Subordinated Indebtedness, each as thereafter
amended or modified in a manner approved by the Agents.
SUBORDINATED MORTGAGE. The Open-End Mortgage, Security Agreement,
Assignment of Rents, Income and Proceeds dated as of July 17, 2000 pursuant to
which the Borrower granted to the holders of the Junior Subordinated
Indebtedness a silent subordinated lien on the Canton Cast-Roll Facility and as
thereafter amended or modified in a manner approved by the Agents.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
SUBSIDIARY GUARANTORS. As of the Effective Date, RTI Capital, Bliss &
Xxxxxxxx, LLC, a Delaware limited liability company, Canadian Drawn Steel
Company Inc. a Canadian corporation and Nimishillen & Tuscarawas, LLC, a
Delaware limited liability company; as of any other date, such Subsidiaries and
any other Subsidiaries of the Borrower that are also Guarantors.
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SUPER-PRIORITY CLAIM. A claim against the Borrower or its estate in its
Case or a Guarantor or its estate in its Case which is an administrative expense
claim having priority over (i) any and all allowed administrative expenses and
(ii) unsecured claims now existing or hereafter arising, including, without
limitation, administrative expenses of the kind specified in Section 503(b),
506(c) or 507(b) of the Bankruptcy Code.
SWEPT ACCOUNTS. Those depository accounts from which all funds and cash
proceeds are transferred to the Administrative Agent pursuant to Section Section
3.4 and 8.13 and the Agency Agreements applicable thereto and any future such
accounts that may be established in accordance with this Credit Agreement.
SWEPT LOCKBOXES. Those lockboxes from which all funds are transferred
to the Swept Accounts pursuant to Section 8.13.1 and the lockbox agreements
pursuant thereto and any future such lockboxes that may be established in
accordance with this Credit Agreement.
TERMINATION DATE. The date on which the Commitment expires, which shall
be the earliest of (i) December 15, 2002, (ii) the effective date of a
Reorganization Plan that has been confirmed by an order of the Bankruptcy Court,
and (iii) the date which is thirty (30) days after the Filing Date in the event
that the Final Order shall not have been entered on or before such date.
TEST PERIOD. For the fiscal quarter ended June 30, 2001, one quarter;
for the fiscal quarter ended September 30, 2001, two quarters; for the fiscal
quarter ended December 31, 2001; three quarters; and for each fiscal quarter end
thereafter, four quarters.
TOTAL COMMITMENT. The sum of the Commitments of the Lenders, as in
effect from time to time, up to an aggregate principal amount outstanding not to
exceed the lesser of (i) $420,000,000 and (ii) the amount approved in the
Interim Order or the Final Order, whichever is in effect at the time of
reference thereto, as the same may be reduced from time to time; or if such
commitment is terminated pursuant to the provisions hereof, zero.
TRADEMARK ASSIGNMENT. The Trademark Collateral Assignment Agreement, of
even date herewith, made by the Borrower in favor of the Administrative Agent.
TRUSTEE. The United States Trust Company of New York, as trustee under
the Indenture.
TYPE. As to any Revolving Credit Loan, its nature as a Base Rate Loan
or a Eurodollar Rate Loan.
UNIFORM CUSTOMS. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto adopted
by the Administrative Agent in the ordinary course of its business as a letter
of credit issuer and in effect at the time of issuance of such Letter of Credit.
UNPAID REIMBURSEMENT OBLIGATION. Any Reimbursement Obligation for which
the Borrower does not reimburse the Administrative Agent and the Lenders on the
date specified in and in accordance with Section 4.2.
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UNRESTRICTED CASH. Cash of the Borrower and its Subsidiaries in Blocked
Accounts and Canadian Blocked Accounts and investments of the type described in
Section 9.3(a), (b), (c) and (i) in which the Administrative Agent, for the
benefit of the Lenders and the Administrative Agent has a security interest.
UNSECURED CREDITORS' COMMITTEE. The Official Unsecured Creditors'
Committee to be organized by the United States Trustee and approved in relation
to the Cases.
UPDATED APPRAISAL. The appraisal of the Canton Cast-Roll Facilities
prepared by MB Advisors and completed in March 2001.
USS/KOBE. See definition of Master Restructuring Agreement.
USX. USX Corporation, a Delaware corporation.
VERITAS. The Veritas Capital Fund, L.P., a Delaware limited
partnership, KDJ L.L.C., a Delaware limited liability company, and HVR Holdings,
L.L.C., a Delaware limited liability company.
VOTING STOCK. Stock, membership interests or similar interests, of any
class or classes (however designated), the holders of which are at the time
entitled, as such holders, to vote under ordinary circumstances for the election
of a majority of the directors (or persons performing similar functions) of the
corporation, association, limited liability company, trust or other business
entity involved irrespective of whether any other stock, membership interests or
similar interests have the right to vote by reason of the happening of a
contingency.
WARRANT AGREEMENT. The Warrant Agreement dated as of August 13, 1999
among the Warrant-Issuer and United States Trust Company of New York, as Warrant
Administrative Agent.
WARRANT-ISSUER. Republic Technologies International, Inc., a Delaware
corporation.
WARRANT DOCUMENTS. The Warrant Agreement and all documents, instruments
and agreements executed in connection therewith, each in the form delivered to
the Agents on or prior to August 13, 1999.
WARRANTS. The Warrants to purchase Class D Common Stock of the
Warrant-Issuer issued to purchasers of the Notes on August 13, 1999.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to time in
accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification to
such law.
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(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) Accounting terms not otherwise defined herein have the meanings
assigned to them by generally accepted accounting principles applied on a
consistent basis by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not limiting.
(g) All terms not specifically defined herein or by generally accepted
accounting principles, which terms are defined in the Uniform Commercial Code as
in effect in the Commonwealth of Massachusetts, have the meanings assigned to
them therein, with the term "instrument" being that defined under Article 9 of
the Uniform Commercial Code.
(h) Reference to a particular "Section" refers to that section of this
Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like import
shall refer to this Credit Agreement as a whole and not to any particular
section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation of periods
of time from a specified date to a later specified date, the word "from" means
"from and including," the words "to" and "until" each mean "to but excluding,"
and the word "through" means "to and including."
(k) This Credit Agreement and the other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are, however, cumulative
and are to be performed in accordance with the terms thereof.
(l) This Credit Agreement and the other Loan Documents are the result
of negotiation among, and have been reviewed by counsel to, among others, the
Administrative Agent and the Borrower and are the product of discussions and
negotiations among all parties. Accordingly, this Credit Agreement and the other
Loan Documents are not intended to be construed against the Administrative Agent
or any of the Lenders merely on account of the Administrative Agent's or any
Lender's involvement in the preparation of such documents.
Section 2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Lenders severally (and not jointly) agrees
to lend to the Borrower and the Borrower may borrow, repay, and reborrow from
time to time between the Effective Date and the Termination Date upon notice by
the Borrower to the Administrative Agent given in accordance with Section 2.6,
such sums as are requested by the Borrower up to a maximum aggregate amount
outstanding (after giving effect to all amounts requested) at any one time equal
to such Lender's Commitment MINUS such Lender's Commitment Percentage of the sum
of the Maximum Drawing Amount and all Unpaid Reimbursement Obligations, PROVIDED
that the
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sum of the outstanding amount of the Revolving Credit Loans (after giving effect
to all amounts requested) PLUS the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations shall not at any time exceed the Availability. The
Revolving Credit Loans shall be made PRO RATA in accordance with each Lender's
Commitment Percentage. Each request for a Revolving Credit Loan hereunder shall
constitute a representation and warranty by the Borrower that the conditions set
forth in Section 11 and Section 12, in the case of the initial Revolving Credit
Loans, and Section 12, in the case of all other Revolving Credit Loans, have
been satisfied on the date of such request.
2.2. COMMITMENT FEE. The Borrower agrees to pay to the Administrative
Agent for the accounts of the Lenders in accordance with their respective
Commitment Percentages a commitment fee calculated at the rate of one half of
one percent (1/2%) per annum on the average daily amount during each calendar
month or portion thereof from the Effective Date to the Termination Date, by
which the Total Commitment minus the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations exceeds the outstanding amount of Revolving Credit
Loans (excluding the Swing Line Loans) during such period or calendar month. The
commitment fee shall be payable monthly in arrears on the first Business Day of
each calendar month for the immediately preceding calendar month commencing on
the first such date following the date hereof, with a final payment on the
Termination Date or any earlier date on which the Commitments shall terminate.
2.3. REDUCTION OF TOTAL COMMITMENT. The Borrower shall have the right
at any time with respect to any unused portion of the Total Commitment and at
the end of the applicable Interest Period with respect to Eurodollar Rate Loans,
and from time to time upon three (3) Business Days' prior written notice to the
Administrative Agent to reduce by $10,000,000 or an integral multiple thereof
the Total Commitment or terminate entirely the Total Commitment, whereupon the
Commitments of the Lenders shall be reduced PRO RATA in accordance with their
respective Commitment Percentages of the amount specified in such notice or, as
the case may be, terminated. Promptly after receiving any notice of the Borrower
delivered pursuant to this Section 2.3, the Administrative Agent will notify the
Lenders of the substance thereof. Upon the effective date of any such reduction
or termination, the Borrower shall pay to the Administrative Agent for the
respective accounts of the Lenders the full amount of any commitment fee then
accrued on the amount of the reduction. No reduction or termination of the
Commitments may be reinstated.
2.4. THE REVOLVING CREDIT NOTES. The Revolving Credit Loans shall be
evidenced by separate promissory notes of the Borrower in substantially the form
of EXHIBIT B hereto, as applicable (each a "REVOLVING CREDIT Note"), dated as of
the Effective Date (or other such date on which a Lender may become a party
hereto in accordance with Section 19 hereof) and completed with appropriate
insertions. One Revolving Credit Note shall be payable to the order of each
Lender in a principal amount equal to such Lender's Commitment or, if less, the
outstanding amount of all Revolving Credit Loans made by such Lender, plus
interest accrued thereon, as set forth below. The Borrower irrevocably
authorizes each Lender to make or cause to be made, at or about the time of the
Drawdown Date of any Revolving Credit Loan or at the time of receipt of any
payment of principal on such Lender's Revolving Credit Note, an appropriate
notation on such Lender's Revolving Credit Note Record reflecting the making of
such Revolving Credit Loan or (as the case may be) the receipt of such payment.
The outstanding amount of the Revolving Credit Loans set forth on such Lender's
Revolving Credit Note Xxxxxx
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xxxxx xx PRIMA FACIE evidence of the principal amount thereof owing and unpaid
to such Lender, but the failure to record, or any error in so recording, any
such amount on such Lender's Revolving Credit Note Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Revolving Credit Note, including, without limitation, its obligations to make
payments of principal of or interest on any Revolving Credit Note when due.
2.5. INTEREST ON REVOLVING CREDIT LOANS. Except as otherwise provided
in Section 5.10,
(a) Each Base Rate Loan shall bear interest at the rate per annum equal
to the Base Rate PLUS the Applicable Margin.
(b) Each Eurodollar Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto at the rate per annum equal to the
Eurodollar Rate determined for such Interest Period PLUS the Applicable Margin.
(c) The Borrower promises to pay interest on each Revolving Credit Loan
in arrears on each Interest Payment Date with respect thereto.
2.6. REQUESTS FOR REVOLVING CREDIT LOANS.
2.6.1. GENERAL. The Borrower shall give to the Administrative
Agent written notice in the form of EXHIBIT C hereto (or telephonic
notice confirmed in a writing in the form of EXHIBIT C hereto) of each
Revolving Credit Loan requested hereunder (a "LOAN REQUEST") (a) one
(1) Business Day prior to the proposed Drawdown Date of any Base Rate
Loan and (b) three (3) Eurodollar Business Days prior to the proposed
Drawdown Date of any Eurodollar Rate Loan. Each such notice shall
specify (i) the principal amount of the Revolving Credit Loan
requested, (ii) the proposed Drawdown Date of such Revolving Credit
Loan, (iii) the Type of such Revolving Credit Loan and (iv) the
Interest Period for such Revolving Credit Loan if a Eurodollar Rate
Loan. Promptly upon receipt of any such notice, the Administrative
Agent shall notify each of the Lenders thereof. Each Loan Request shall
be irrevocable and binding on the Borrower and shall obligate the
Borrower to accept the Revolving Credit Loan requested from the Lenders
on the proposed Drawdown Date. Each Loan Request for Eurodollar Rate
Loans shall be in a minimum aggregate amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof and no more than five
(5) Eurodollar Rate Loans' Interest Periods may run concurrently at any
time during the term of this Credit Agreement.
2.6.2. SWING LINE. Notwithstanding the notice and minimum
amount requirements set forth in Section 2.6.1 but otherwise in
accordance with the terms and conditions of this Credit Agreement, the
Administrative Agent may, in its sole discretion and without conferring
with the Lenders, make Revolving Credit Loans to the Borrower up to a
maximum aggregate amount outstanding (after giving effect to all
amounts borrowed under this Section 2.6.2) at any one time equal to
$15,000,000 (i) by entry of credits to the Borrower's Operating Account
to cover checks or other charges which the Borrower has drawn or made
against such account or (ii) in an amount as otherwise requested by the
Borrower. The Borrower hereby requests and authorizes the
Administrative Agent to make from time to time such Revolving Credit
Loans by means of appropriate entries of
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such credits sufficient to cover checks and other charges then
presented for payment from the Operating Account or as otherwise so
requested. The Borrower acknowledges and agrees that the making of such
Revolving Credit Loans shall, in each case, be subject in all respects
to the provisions of this Credit Agreement as if they were Revolving
Credit Loans covered by a Loan Request including, without limitation,
the limitations set forth in Section 2.1 and the requirements that the
applicable provisions of Section 11 (in the case of Revolving Credit
Loans made on the Effective Date) and Section 12 be satisfied. All
actions taken by the Administrative Agent pursuant to the provisions of
this Section 2.6.2 shall be conclusive and binding on the Borrower and
the Lenders absent the Administrative Agent's gross negligence or
willful misconduct. Revolving Credit Loans made pursuant to this
Section 2.6.2 shall be Base Rate Loans until converted in accordance
with the provisions of this Agreement and, prior to a Settlement, such
interest shall be for the account of the Administrative Agent. The
Lenders shall pay the Administrative Agent their PRO RATA share of
Revolving Credit Loans made pursuant to this Section 2.6.2 pursuant to
the settlement provisions of Section 2.8.3.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING CREDIT LOAN.
The Borrower may elect from time to time to convert any outstanding
Revolving Credit Loan to a Revolving Credit Loan of another Type,
PROVIDED that (a) with respect to any such conversion of a Revolving
Credit Loan to a Base Rate Loan, the Borrower shall give the
Administrative Agent at least one (1) Business Day's prior written
notice of such election; (b) with respect to any such conversion of a
Revolving Credit Loan to a Eurodollar Rate Loan, the Borrower shall
give the Administrative Agent at least three (3) Eurodollar Business
Days' prior written notice of such election; (c) with respect to any
such conversion of a Eurodollar Rate Loan into a Revolving Credit Loan
of another Type, such conversion shall only be made on the last day of
the Interest Period with respect thereto and (d) no Revolving Credit
Loan may be converted into a Eurodollar Rate Loan when any Default or
Event of Default has occurred and is continuing. On the date on which
such conversion is being made each Lender shall take such action as is
necessary to transfer its Commitment Percentage of such Revolving
Credit Loans to its Domestic Lending Office or its Eurodollar Lending
Office, as the case may be. All or any part of outstanding Revolving
Credit Loans of any Type may be converted into a Revolving Credit Loan
of another Type as provided herein, provided that any partial
conversion shall be in an aggregate principal amount of $5,000,000 or
an integral multiple of $1,000,000 in excess thereof. Each Conversion
Request relating to the conversion of a Revolving Credit Loan to a
Eurodollar Rate Loan shall be irrevocable by the Borrower.
2.7.2. CONTINUATION OF TYPE OF REVOLVING CREDIT LOAN. Any
Revolving Credit Loan of any Type may be continued as a Revolving
Credit Loan of the same Type upon the expiration of an Interest Period
with respect thereto by compliance by the Borrower with the notice
provisions contained in Section 2.7.1; PROVIDED that no Eurodollar Rate
Loan may be continued as such when any Default or Event of Default has
occurred and is continuing and the Administrative Agent has given the
Borrower notice that the option to borrow or continue Eurodollar Rate
Loans has been suspended or terminated, but
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shall be automatically converted to a Base Rate Loan on the last day of
the first Interest Period relating thereto ending during the
continuance of any Default or Event of Default and following such
notice. In the event the Borrower fails to provide any such notice with
respect to the continuation of any Eurodollar Rate Loan as such, then
such Eurodollar Rate Loan shall be automatically converted to a Base
Rate Loan on the last day of the Interest Period relating thereto. The
Administrative Agent shall notify the Lenders promptly when any such
automatic conversion contemplated by this Section 2.7 is scheduled to
occur.
2.7.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurodollar Rate Loans having the same Interest
Period shall not be less than $5,000,000 or an integral multiple of
$1,000,000 in excess thereof.
2.8. FUNDS FOR REVOLVING CREDIT LOAN.
2.8.1. FUNDING PROCEDURES. Not later than 12:00 Noon (Boston
time) on the proposed Drawdown Date (other than the date on which any
Revolving Credit Loan is converted or continued in accordance with
Section 2.7) of any Revolving Credit Loans, each of the Lenders will
make available to the Administrative Agent, at its Head Office, in
immediately available funds, the amount of such Lender's Commitment
Percentage of the amount of the requested Revolving Credit Loans. Upon
receipt from each Lender of such amount, and upon receipt of the
documents required by Section Section 11 and 12 on the Effective Date
and thereafter required by Section 12 and the satisfaction of the other
conditions set forth therein, to the extent applicable, the
Administrative Agent will make available to the Borrower the aggregate
amount of such Revolving Credit Loans made available to the
Administrative Agent by the Lenders. The failure or refusal of any
Lender to make available to the Administrative Agent at the aforesaid
time and place on any such Drawdown Date the amount of its Commitment
Percentage of the requested Revolving Credit Loans shall not relieve
any other Lender from its several obligation hereunder to make
available to the Administrative Agent the amount of such Lender's
Commitment Percentage of any requested Revolving Credit Loans.
2.8.2. ADVANCES BY ADMINISTRATIVE AGENT. The Administrative
Agent may, unless notified to the contrary by any Lender prior to a
Drawdown Date (other than the date on which any Revolving Credit Loan
is converted or continued in accordance with Section 2.7), assume that
such Lender has made available to the Administrative Agent on such
Drawdown Date the amount of such Lender's Commitment Percentage of the
Revolving Credit Loans to be made on such Drawdown Date, and the
Administrative Agent may (but it shall not be required to), in reliance
upon such assumption, make available to the Borrower a corresponding
amount. If any Lender makes available to the Administrative Agent such
amount on a date after such Drawdown Date, such Lender shall pay to the
Administrative Agent on demand an amount equal to the product of (a)
the average computed for the period referred to in clause (c) below, of
the weighted average interest rate paid by the Administrative Agent for
federal funds acquired by the Administrative Agent during each day
included in such period, times (b) the amount of such Lender's
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Commitment Percentage of such Revolving Credit Loans, times (c) a
fraction, the numerator of which is the number of days that elapse from
and including such Drawdown Date to the date on which the amount of
such Lender's Commitment Percentage of such Revolving Credit Loans
shall become immediately available to the Administrative Agent, and the
denominator of which is 365. A statement of the Administrative Agent
submitted to such Lender with respect to any amounts owing under this
paragraph shall be PRIMA FACIE evidence of the amount due and owing to
the Administrative Agent by such Lender. If the amount of such Lender's
Commitment Percentage of such Revolving Credit Loans is not made
available to the Administrative Agent by such Lender within three (3)
Business Days following such Settling Date, the Administrative Agent
shall be entitled to recover such amount from the Borrower on demand,
with interest thereon at the rate per annum applicable to the Revolving
Credit Loans made most recently preceding such Drawdown Date.
2.8.3. SETTLEMENTS.
2.8.3.1. GENERAL. On each Settling Date, the
Administrative Agent shall, not later than 11:00 a.m. (Boston
time), give telephonic or facsimile notice (i) to the Lenders
and the Borrower of the respective outstanding amount of
Revolving Credit Loans made by the Administrative Agent on
behalf of the Lenders from the immediately preceding Settling
Date through the close of business on the prior day and the
amount of any Eurodollar Rate Loans to be made (following the
giving of notice pursuant to Section 2.6.1(b)) on such date
pursuant to a Loan Request and (ii) to the Lenders of the
amount (a "SETTLEMENT AMOUNT") that each Lender (a "SETTLING
LENDER") shall pay to effect a Settlement of any Revolving
Credit Loan. A statement of the Administrative Agent submitted
to the Lenders and the Borrower or to the Lenders with respect
to any amounts owing under this Section 2.8.3 shall be prima
facie evidence of the amount due and owing. Each Settling
Lender shall, not later than 3:00 p.m. (Boston time) on such
Settling Date, effect a wire transfer of immediately available
funds to the Administrative Agent in the amount of the
Settlement Amount for such Settling Lender. All funds advanced
by any Lender as a Settling Lender pursuant to this Section
2.8.3 shall for all purposes be treated as a Revolving Credit
Loan made by such Settling Lender to the Borrower and all
funds received by any Lender pursuant to this Section 2.8.3
shall for all purposes be treated as repayment of amounts owed
with respect to Revolving Credit Loans made by such Lender. In
the event that a Settling Lender is prevented from making any
Revolving Credit Loan to effect a Settlement as contemplated
hereby, such Settling Lender will make such dispositions and
arrangements with the other Lenders with respect to such
Revolving Credit Loans, either by way of purchase of
participations, distribution, pro tanto assignment of claims,
subrogation or otherwise as shall result in each Lender's
share of the outstanding Revolving Credit Loans being equal,
as nearly as may be, to such Lender's Commitment Percentage of
the outstanding amount of the Revolving Credit Loans.
2.8.3.2. FAILURE TO MAKE FUNDS AVAILABLE. The
Administrative Agent may, unless notified to the contrary by
any Settling Lender prior to a Settling
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Date, assume that such Settling Lender has made or will make
available to the Administrative Agent on such Settling Date
the amount of such Settling Lender's Settlement Amount, and
the Administrative Agent may (but it shall not be required
to), in reliance upon such assumption, make available to the
Borrower a corresponding amount. If any Settling Lender makes
available to the Administrative Agent such amount on a date
after such Settling Date, such Settling Lender shall pay to
the Administrative Agent on demand an amount equal to the
product of (i) the average computed for the period referred to
in clause (iii) below, of the weighted average interest rate
paid by the Administrative Agent for federal funds acquired by
the Administrative Agent during each day included in such
period, times (ii) the amount of such Settlement Amount, times
(iii) a fraction, the numerator of which is the number of days
that elapse from and including such Settling Date to the date
on which the amount of such Settlement Amount shall become
immediately available to the Administrative Agent, and the
denominator of which is 360. A statement of the Administrative
Agent submitted to such Settling Lender with respect to any
amounts owing under this Section 2.8.3.2 shall be PRIMA FACIE
evidence of the amount due and owing to the Administrative
Agent by such Settling Lender. If such Settling Lender's
Settlement Amount is not made available to the Administrative
Agent by such Settling Lender within three (3) Business Days
following such Settling Date, the Administrative Agent shall
be entitled to recover such amount from the Borrower on
demand, with interest thereon at the rate per annum applicable
to the Revolving Credit Loans as of such Settling Date.
2.8.3.3. NO EFFECT ON OTHER LENDERS. The failure or
refusal of any Settling Lender to make available to the
Administrative Agent at the aforesaid time and place on any
Settling Date the amount of such Settling Lender's Settlement
Amount shall not (i) relieve any other Settling Lender from
its several obligations hereunder to make available to the
Administrative Agent the amount of such other Settling
Lender's Settlement Amount or (ii) impose upon any Lender,
other than the Settling Lender so failing or refusing, any
liability with respect to such failure or refusal or otherwise
increase the Commitment of such other Lender.
2.9. CHANGE IN BORROWING BASE. The Borrowing Base shall be determined
daily by the Administrative Agent (with reserves adjusted monthly, or at more
frequent intervals as determined by the Administrative Agent) by reference to
the Borrowing Base Report.
Section 3. REPAYMENT OF THE REVOLVING CREDIT LOANS.
3.1. MATURITY. The Borrower promises to pay on the Termination Date,
and there shall become absolutely due and payable on the Termination Date, all
of the Revolving Credit Loans outstanding on such date, together with any and
all accrued and unpaid interest thereon.
3.2. MANDATORY REPAYMENTS OF REVOLVING CREDIT LOANS.
(a) If at any time the sum of the outstanding amount of the Revolving
Credit Loans, the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations exceeds the
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Availability, then the Borrower shall immediately pay the amount of such excess
to the Administrative Agent for the respective accounts of the Lenders. Any
amounts paid to the Administrative Agent for the respective accounts of the
Lenders under this Section 3.2(a) shall be applied, FIRST, to any Unpaid
Reimbursement Obligations; SECOND, in the absence of instruction by the
Borrower, to the principal of Base Rate Loans and then to the principal of
Eurodollar Rate Loans; and THIRD, to provide to the Administrative Agent cash
collateral for Reimbursement Obligations as contemplated by Section 4.2(b) and
(c). Each payment of any Unpaid Reimbursement Obligations or prepayment of
Revolving Credit Loans shall be allocated among the Lenders, in proportion, as
nearly as practicable, to each Unpaid Reimbursement Obligation or (as the case
may be) the respective unpaid principal amount of each Lender's Revolving Credit
Note, with adjustments to the extent practicable to equalize any prior payments
or repayments not exactly in proportion.
(b) The Borrower hereby agrees that:
(i) if the Borrower or any of its Subsidiaries shall sell the
Canton Cast-Roll Facility or any substantial portion thereof (other
than de minimis sales of obsolete equipment in the ordinary course of
business), (A) the Eligible Fixed Asset Cap shall be reduced
immediately to $0, and (B) the Borrower shall immediately apply an
amount equal to the Net Cash Proceeds of such sale of the Canton
Cast-Roll Facility to the Unpaid Reimbursement Obligations, Revolving
Credit Loans and Reimbursement Obligations in the order provided for in
Section 3.2(a); and
(ii) if the Borrower or any of its Subsidiaries shall receive
insurance proceeds related to the Canton Cast-Roll Facility or receive
awards for takings or condemnation of any of the Collateral and, (A),
if the Borrower notifies the Administrative Agent on or before the
receipt of such awards or proceeds of its intention to reinvest the Net
Cash Proceeds of such awards or proceeds, such Net Cash Proceeds shall
be immediately delivered to the Administrative Agent to be held as cash
collateral for the Obligations until the earlier to occur of (x) the
disbursement of such Net Cash Proceeds by the Administrative Agent,
upon terms and conditions as the Administrative Agent may reasonably
prescribe, for direct application by the Borrower to the repair or
replacement of such Collateral and (y) the termination of the 180 day
period following receipt of such proceeds, upon which date the Borrower
shall repay the Revolving Credit Loans in an aggregate amount equal to
the remaining unreinvested amount of Net Cash Proceeds of such proceeds
or awards or, in the case of proceeds or awards related to the Canton
Cast-Roll Facility and not applied to repair or replace the same as
provided in clause (x) above, to repay the Revolving Credit Loans in an
amount equal to such Net Cash Proceeds and reduce the Eligible Fixed
Asset Cap in at least an amount equal to the reduction in appraised
value of the Canton Cast-Roll Facility if the Canton Cast-Roll Facility
remains operational or the entire amount of the Eligible Fixed Asset
Cap if the Canton Cast-Roll Facility is no longer operational and, (B)
if the Borrower does not notify the Administrative Agent on or before
the receipt of such awards or proceeds of its intention to reinvest the
Net Cash Proceeds of such awards or proceeds the Borrower repay the
Revolving Credit Loans in an aggregate amount equal to the Net Cash
Proceeds of such proceeds or awards immediately upon the receipt of
such Net Cash
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Proceeds and in the case of the Canton Cast-Roll Facility, if the
Canton Cast-Roll Facility is no longer operational the Eligible Fixed
Asset Cap shall be immediately reduced to $0.
To the extent that any reduction in the Total Commitment shall result
in the sum of the outstanding amount of the Revolving Credit Loans, the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations to be greater than the
Availability, the Borrower shall repay such excess in accordance with Section
3.2(a) hereof.
3.3. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The Borrower shall
have the right, at its election, to repay the outstanding amount of the
Revolving Credit Loans, as a whole or in part, at any time without penalty or
premium, provided that any full or partial prepayment of the outstanding amount
of any Eurodollar Rate Loans pursuant to this Section 3.3 may be made only on
the last day of the Interest Period relating thereto. The Borrower shall give
the Administrative Agent, no later than 11:00 a.m., Boston time, on the day of
the proposed repayment prior written notice of any proposed prepayment pursuant
to this Section 3.3 of Base Rate Loans, and three (3) Eurodollar Business Days'
notice of any proposed prepayment pursuant to this Section 3.3 of Eurodollar
Rate Loans, in each case specifying the proposed date of prepayment of Revolving
Credit Loans and the principal amount to be prepaid. Each such partial
prepayment of the Revolving Credit Loans shall be in an integral multiple of
$1,000,000 and shall be applied, in the absence of instruction by the Borrower,
first to the principal of Base Rate Loans and then to the principal of
Eurodollar Rate Loans. Each partial prepayment shall be allocated among the
Lenders, in proportion, as nearly as practicable, to the respective unpaid
principal amount of each Lender's Revolving Credit Note, with adjustments to the
extent practicable to equalize any prior repayments not exactly in proportion.
3.4. AUTOMATIC REPAYMENTS OF REVOLVING CREDIT LOANS PRIOR TO EVENT OF
DEFAULT.
3.4.1. CREDIT FOR FUNDS TRANSFERRED FROM SWEPT ACCOUNTS. Prior
to the occurrence of an Event of Default as to which the account
officers of the Administrative Agent active upon the Borrower's account
have actual knowledge, (i) all funds and cash proceeds in the form of a
wire transfer transferred to the Administrative Agent from the Swept
Accounts as contemplated by Section 8.13.2(c) shall be credited on the
same Business Day as the Administrative Agent's receipt of such amounts
(or up to such later date as the Administrative Agent determines that
good collected funds have been received), and applied as contemplated
by Section 3.4.2, and (ii) all funds and cash proceeds in the form of
an automated clearing house transfer transferred to the Administrative
Agent from the Swept Accounts as contemplated by Section 8.13.2(c)
shall be credited, on the next Business Day following the
Administrative Agent's receipt of such amounts (or up to such later
date as the Administrative Agent determines that good collected funds
have been received), and applied as contemplated by Section 3.4.2. For
purposes of the foregoing provisions of this Section 3.4, the
Administrative Agent shall not be deemed to have received any such
funds or cash proceeds on any day unless received by the Administrative
Agent before 3:00 p.m. (Boston time) on such day. The Borrower further
acknowledges and agrees that any such provisional credits or credits in
respect of wire or automatic clearing house funds transfers shall be
subject to reversal if final collection in good funds of the related
item is not received by, or final settlement of the funds transfer is
not made in favor of, the Administrative Agent in accordance with the
Administrative
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Agent's customary procedures and practices for collecting provisional
items or receiving settlement of funds transfers.
3.4.2. APPLICATION OF AUTOMATIC PAYMENTS PRIOR TO EVENT OF
DEFAULT.
(a) Prior to the occurrence of an Event of Default of
which the account officers of the Administrative Agent active
on the Borrower's account have knowledge, all funds
transferred to the Administrative Agent for application
against the Obligations and for which the Borrower has
received credits shall be applied to the Obligations as
follows:
(i) first, to pay amounts then due and
payable under this Credit Agreement, the Revolving
Credit Notes and the other Loan Documents;
(ii) second, to reduce Revolving Credit
Loans made by the Administrative Agent pursuant to
Section 2.6.2 and for which Settlement has not then
been made;
(iii) third, to reduce Revolving Credit
Loans made by the Administrative Agent pursuant to
Section 2.8.2 and for which Settlement has not then
been made;
(iv) fourth, to reduce other Revolving
Credit Loans which are Base Rate Loans;
(v) fifth, to reduce Revolving Credit Loans
which are Eurodollar Rate Loans; and
(vi) sixth, except as otherwise required
bySection 4.2(b) and (c), to the Concentration
Account.
(b) All prepayments of Eurodollar Rate Loans prior to
the end of an Interest Period shall obligate the Borrower to
pay any breakage costs associated with such Eurodollar Rate
Loans in accordance with Section 5.9.
(c) All repayments of the Revolving Credit Loans
pursuant to this Section 3.4.2 shall be allocated among the
Lenders making such Revolving Credit Loans, in proportion, as
nearly as practicable, to the respective unpaid principal
amount of such Revolving Credit Loans outstanding, with
adjustments to the extent practicable to equalize any prior
payments or repayments not exactly in proportion. Prior to any
Settlement Date, however, all repayments of the Revolving
Credit Loans shall be applied in accordance with this Section
3.4.2, first to outstanding Revolving Credit Loans of the
Administrative Agent.
3.5. AUTOMATIC REPAYMENTS OF REVOLVING CREDIT LOANS AFTER EVENT OF
DEFAULT. Following the occurrence and during the continuance of an Event of
Default of which the account officers of the Administrative Agent active on the
Borrower's account have
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knowledge, all funds transferred to the Administrative Agent from the Swept
Accounts for which the Borrower has received credits shall be applied to the
Obligations in accordance with Section 13.4.
Section 4. LETTERS OF CREDIT.
4.1. LETTER OF CREDIT COMMITMENTS.
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by the
Borrower of a letter of credit application on the Issuing Bank's
customary form (a "LETTER OF CREDIT APPLICATION"), the Issuing Bank
and, in case of the Chase Letter of Credit, Chase, on behalf of the
Lenders and in reliance upon the agreement of the Lenders set forth in
Section 4.1.4 and upon the representations and warranties of the
Borrower contained herein, agrees, in its individual capacity, to
issue, extend and renew for the account of the Borrower one or more
standby or documentary letters of credit (individually, a "LETTER OF
CREDIT"), in such form as may be requested from time to time by the
Borrower and agreed to by the Issuing Bank; PROVIDED, HOWEVER, that,
after giving effect to such request, (a) the sum of the aggregate
Maximum Drawing Amount shall not exceed $50,000,000 at any one time and
(b) the sum of (i) the Maximum Drawing Amount on all Letters of Credit,
(ii) all Unpaid Reimbursement Obligations, and (iii) the amount of all
Revolving Credit Loans outstanding shall not exceed the Availability;
PROVIDED, FURTHER, that Chase shall issue, extend or renew no Letters
of Credit other than the Chase Letter of Credit.
4.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Issuing Bank.
In the event that any provision of any Letter of Credit Application
shall be inconsistent with any provision of this Credit Agreement, then
the provisions of this Credit Agreement shall, to the extent of any
such inconsistency, govern.
4.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit
issued, extended or renewed hereunder shall, among other things, (a)
provide for the payment of sight drafts for honor thereunder when
presented in accordance with the terms thereof and when accompanied by
the documents described therein, and (b) have an expiry date no later
than the date which is ten (10) days (or, if the beneficiary is located
outside of the United States of America or the Letter of Credit is
confirmed by a confirmer or otherwise provides for one or more
nominated persons, forty-five (45) days) prior to the Termination Date.
Each Letter of Credit so issued, extended, maintained or renewed shall
be subject to the Uniform Customs or, in the case of a standby Letter
of Credit, either the Uniform Customs or the International Standby
Practices.
4.1.4. REIMBURSEMENT OBLIGATIONS OF LENDERS. Each Lender and
the Borrower hereby acknowledge that each Letter of Credit issued or
maintained by the Issuing Bank or Chase pursuant to this Credit
Agreement is issued or maintained by the Issuing Bank or Chase, as
applicable, on behalf of the Lenders. Each Lender severally agrees that
it shall be absolutely liable, without regard to the occurrence of any
Default or Event of Default or any other condition precedent
whatsoever, to the extent of such Lender's Commitment Percentage, to
reimburse the Issuing Bank or Chase, as applicable, on
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demand for the amount of each draft paid by the Issuing Bank or Chase
under each Letter of Credit to the extent that such amount is not
reimbursed by the Borrower pursuant to Section 4.2 (such agreement for
a Lender being called herein the "LETTER OF CREDIT PARTICIPATION" of
such Lender).
4.1.5. PARTICIPATION OF LENDERS. Each such payment made by a
Lender shall be treated as the purchase by such Lender of a
participating interest in the Borrower's Reimbursement Obligation under
Section 4.2 in an amount equal to such payment. Each Lender shall share
in accordance with its participating interest in any interest which
accrues pursuant to Section 4.2.
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Issuing Bank to issue, extend and renew each Letter of Credit other than the
Chase Letter of Credit, or, in the case of Chase, to maintain the Chase Letter
of Credit, and the Lenders to participate therein, the Borrower hereby agrees to
reimburse or pay to the Issuing Bank, for the account of the Issuing Bank, Chase
or (as the case may be) the Lenders, with respect to each Letter of Credit
issued, extended or renewed by the Issuing Bank or Chase hereunder,
(a) except as otherwise expressly provided in Section 4.2(b) and (c),
on each date that any draft presented under such Letter of Credit is honored by
the Issuing Bank or any draft presented under the Chase Letter of Credit is
honored by Chase, or the Issuing Bank or Chase otherwise makes a payment with
respect thereto, (i) the amount paid by the Issuing Bank or Chase under or with
respect to such Letter of Credit, and (ii) the amount of any taxes, fees,
charges or other costs and expenses whatsoever incurred by the Issuing Bank or
any Lender in connection with any payment made by the Issuing Bank or any
Lender, under, or with respect to, such Letter of Credit,
(b) upon the reduction (but not termination) of the Total Commitment to
an amount less than the Maximum Drawing Amount, an amount equal to 110% of such
difference, which amount shall be held by the Issuing Bank for the benefit of
the Lenders and the Issuing Bank as cash collateral for all Reimbursement
Obligations, and
(c) upon the termination of the Total Commitment, or the acceleration
of the Reimbursement Obligations with respect to all Letters of Credit in
accordance with Section 13 or the occurrence of the Termination Date, an amount
equal to 110% of the then Maximum Drawing Amount on all Letters of Credit, which
amount shall be held by the Issuing Bank for the benefit of the Lenders and the
Issuing Bank as cash collateral for all Reimbursement Obligations.
Each such payment shall be made to the Issuing Bank at the Issuing
Bank's office in immediately available funds. Interest on any and all amounts
remaining unpaid by the Borrower under this Section 4.2 at any time from the
date such amounts become due and payable (whether as stated in this Section 4.2,
by acceleration or otherwise) until payment in full (whether before or after
judgment) shall be payable to the Issuing Bank on demand at the rate specified
in Section 5.10 for overdue principal on the Revolving Credit Loans.
4.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the Issuing
Bank or Chase, as applicable, shall notify the Borrower of the date and amount
of the draft presented or demand for payment
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and of the date and time when it expects to pay such draft or honor such demand
for payment. If the Borrower fails to reimburse the Issuing Bank as provided in
Section 4.2 on or before the date that such draft is paid or other payment is
made by the Issuing Bank, the Issuing Bank may at any time thereafter notify the
Lenders of the amount of any such Unpaid Reimbursement Obligation. No later than
3:00 p.m. (Boston time) on the Business Day next following the receipt of such
notice, each Lender shall make available to the Issuing Bank, at its office, in
immediately available funds, such Lender's Commitment Percentage of such Unpaid
Reimbursement Obligation, together with an amount equal to the product of (i)
the average, computed for the period referred to in clause (iii) below, of the
weighted average interest rate paid by the Issuing Bank or Chase, as applicable,
for federal funds acquired by the Issuing Bank or Chase, as applicable, during
each day included in such period, TIMES (ii) the amount equal to such Lender's
Commitment Percentage of such Unpaid Reimbursement Obligation, TIMES (iii) a
fraction, the numerator of which is the number of days that elapse from and
including the date the Issuing Bank or Chase, as applicable, paid the draft
presented for honor or otherwise made payment to the date on which such Lender's
Commitment Percentage of such Unpaid Reimbursement Obligation shall become
immediately available to the Issuing Bank, and the denominator of which is 365.
If such payments by the Lenders are made with respect to the Chase Letter of
Credit, such payments to the Issuing Bank shall be for the account of Chase. The
responsibility of the Issuing Bank and Chase, as applicable, to the Borrower and
the Lenders shall be only to determine that the documents (including each draft)
delivered under each Letter of Credit in connection with such presentment shall
be in accordance in all material respects with such Letter of Credit.
4.4. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this
Section 4 to repay drawings under the Letters of Credit as provided hereunder
shall rank pari passu with the obligations of the Borrower to repay all other
Revolving Credit Loans, and shall be absolute and unconditional under any and
all circumstances and irrespective of the occurrence of any Default or Event of
Default or any condition precedent whatsoever or any setoff, counterclaim or
defense to payment which the Borrower may have or have had against the Issuing
Bank, Chase, any Lender or any beneficiary of a Letter of Credit. The Borrower
further agrees with the Issuing Bank, Chase and the Lenders that the Issuing
Bank, Chase and the Lenders shall not be responsible for, and the Borrower's
Reimbursement Obligations under Section 4.2 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even if such documents should in fact prove to be in any or all
respects invalid, fraudulent or forged, or any dispute between or among the
Borrower, the beneficiary of any Letter of Credit or any financing institution
or other party to which any Letter of Credit may be transferred or any claims or
defenses whatsoever of the Borrower against the beneficiary of any Letter of
Credit or any such transferee. The Issuing Bank, Chase and the Lenders shall not
be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrower agrees that any action taken
or omitted by the Issuing Bank or any Lender under or in connection with each
Letter of Credit and the related drafts and documents, if done in good faith and
not constituting gross negligence or willful misconduct, shall be binding upon
the Borrower and shall not result in any liability on the part of the Issuing
Bank, Chase or any Lender to the Borrower.
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4.5. RELIANCE BY ISSUER. To the extent not inconsistent with Section
4.4, the Issuing Bank (and Chase, with respect to the Chase Letter of Credit)
shall be entitled to rely, and shall be fully protected in relying upon, any
Letter of Credit, draft, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel, independent accountants and other
experts selected by the Issuing Bank (or Chase, in the case of the Chase Letter
of Credit). The Issuing Bank (and Chase, with respect to the Chase Letter of
Credit) shall be fully justified in failing or refusing to take any action under
this Credit Agreement unless it shall first have received such advice or
concurrence of the Majority Lenders as it reasonably deems appropriate or it
shall first be indemnified to its reasonable satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Issuing Bank (and Chase, with
respect to the Chase Letter of Credit) shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement in accordance with a
request of the Majority Lenders, and such request and any action taken or
failure to act pursuant thereto shall be binding upon the Lenders and all future
holders of the Revolving Credit Notes or of any Letter of Credit Participation.
4.6. LETTER OF CREDIT FEE. The Borrower shall pay a fee (in each case,
a "LETTER OF CREDIT FEE") to the Issuing Bank at a rate per annum (a) in respect
of each standby Letter of Credit equal to (i) the Applicable Margin for
Eurodollar Rate Loans PLUS one-eighth of one percent (1/8%) per annum of the
face amount of such standby Letter of Credit PLUS (ii) the Issuing Bank's
customary issuance fee for any Letter of Credit issued after the Effective Date,
and (b) in respect of each documentary Letter of Credit equal to (i) the Issuing
Bank's customary issuance fee or amendment fee, as the case may be, plus (ii)
the Issuing Bank's customary time negotiation fee per document examination PLUS
(iii) an amount equal to the Applicable Margin for Eurodollar Rate Loans PLUS
one-eighth of one percent (1/8%) per annum of the face amount of such
documentary Letter of Credit. Each issuance, amendment, negotiation or document
examination fee and, with respect to each Letter of Credit, a portion of the
Letter of Credit Fee in the amount of one-eighth of one percent (1/8%) of the
face amount of each standby Letter of Credit and each documentary Letter of
Credit shall be for the Issuing Bank's own account (or for the account of Chase,
in the case of the Chase Letter of Credit) and the remaining portion of each
Letter of Credit Fee shall be for the accounts of the Lenders in accordance with
their respective Commitment Percentages. The Letter of Credit Fee referred to in
clauses (a)(i) and (b)(iii) shall be payable quarterly in arrears, and all such
other Letter of Credit Fees shall be payable upon issuance, amendment or
negotiation, as the case may be.
4.7. CASH COLLATERAL FOR LETTER OF CREDIT OBLIGATIONS. On the
Termination Date, the Borrower shall, in addition to cash collateral provided
pursuant to Section 4.2., (a) deposit with the Issuing Bank an amount equal to
110% of the aggregate Maximum Drawing Amount of all Letters of Credit which
expire within forty-five (45) days of the Termination Date, such amount to be
held by the Issuing Bank as cash collateral for any drawing under any such
Letter of Credit or, (b) provide a backup letter of credit for such Letters of
Credit acceptable to the Administrative Agent.
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4.8. ROLLOVER LC'S. On the Effective Date, the Rollover LC's shall, for
all purposes hereunder, be treated as letters of credit issued pursuant to
Section 4 hereof and the Borrower's reimbursement obligations in respect thereof
shall be included in the Obligations. Each Lender agrees that its Letter of
Credit Participation shall extend to the Rollover LC's.
Section 5. CERTAIN GENERAL PROVISIONS.
5.1. FEES.
5.1.1. FACILITY FEE. A facility fee in the amount of
$1,000,000 shall be fully earned by the Agents and the Lenders on the
Effective Date, and shall be paid to the Administrative Agent on the
Effective Date, for the accounts of certain of the Lenders as set forth
on SCHEDULE 5.1.1. hereto.
5.1.2. AGENTS' FEES. An agents' fee in the amount of $300,000
shall be fully earned by the Agents on the Effective Date and shall be
paid to the Administrative Agent on the Effective Date, such agents'
fee to be shared equally by the Agents.
5.1.3. ADMINISTRATIVE AGENT'S FEE. The Borrower shall also pay
to the Administrative Agent for its own account, an administrative
agent's fee at the times and in the amounts set forth in the fee letter
between the Administrative Agent and the Borrower.
5.1.4. AMENDMENT FEE 2. An amendment fee in the amount of
$1,975,000 shall be fully earned by the Agents and the Lenders on the
Effective Date and shall be paid to the Administrative Agent for the
accounts of the Lenders in accordance with their Commitment
Percentages. A portion of the amendment fee in the amount of $987,500
shall be payable on October 1, 2001 and the remaining portion shall be
payable on March 31, 2002. If on any date on or prior to September 30,
2001 the Eligible Fixed Asset Cap is reduced to $0 in accordance with
Section 3.2(b) of the Credit Agreement, Amendment Fee 2 shall be
forgiven on such date.
5.1.5. STRUCTURING FEE. A structuring fee in the amount of
$265,625 shall be fully earned by the Agents on the Effective Date and
shall be paid to the Administrative Agent on March 31, 2002, such
structuring fee to be shared equally by the Agents.
5.1.6. NATURE OF FEES. All of the above fees will be fully
earned on the Effective Date and will be non-refundable.
5.2. FUNDS FOR PAYMENTS.
5.2.1. PAYMENTS TO ADMINISTRATIVE AGENT. All payments of
principal, interest, Reimbursement Obligations, commitment fees, Letter
of Credit Fees and any other amounts due hereunder or under any of the
other Loan Documents shall be made to the Administrative Agent, for the
respective accounts of the Lenders and the Administrative Agent, at the
Administrative Agent's Office or at such other location in the Boston,
Massachusetts, area that the Administrative Agent may from time to time
designate, in each case in Dollars in immediately available funds.
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5.2.2. NO OFFSET, ETC.
(a) All payments by the Borrower or any Guarantor
hereunder and under any of the other Loan Documents shall be
made without setoff or counterclaim and, except as provided in
paragraph (c) below, free and clear of and without deduction
for any taxes, levies, imposts, duties, charges, fees,
deductions or withholdings of any nature now or hereafter
imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein
unless the Borrower or such Guarantor is compelled by law to
make such deduction or withholding. If any such obligation is
imposed upon the Borrower or any Guarantor with respect to any
amount payable by it hereunder or under any of the other Loan
Documents, the Borrower or such Guarantor will, except as
provided in paragraph (c) below, pay to the Administrative
Agent, for the account of the Lenders or (as the case may be)
the Administrative Agent, on the date on which such amount is
due and payable hereunder or under such other Loan Document,
such additional amount in Dollars as shall be necessary to
enable the Lenders or the Administrative Agent to receive the
same net amount which the Lenders or the Administrative Agent
would have received on such due date had no such obligation
been imposed upon the Borrower or such Guarantor. The Borrower
or such Guarantor will deliver promptly to the Administrative
Agent certificates or other valid vouchers for all taxes or
other charges deducted from or paid with respect to payments
made by the Borrower or such Guarantor hereunder or under such
other Loan Document.
(b) Each Lender and the Administrative Agent that is
not a U.S. Person as defined in Section 7701(a)(30) of the
Code hereby agrees that, if and to the extent it is legally
able to do so, it shall, prior to the date of the first
payment by the Borrower hereunder to be made to such Lender or
the Administrative Agent or for such Lender's or the
Administrative Agent's account, deliver to the Borrower and
the Administrative Agent, as applicable, such certificates,
documents or other evidence, as and when required by the Code
or Treasury Regulations issued pursuant thereto, including two
(2) duly completed copies of Internal Revenue Service Form
W-8BEN or Form W-8ECI and any other certificate or statement
of exemption required by Treasury Regulations, or any
subsequent versions thereof or successors thereto, properly
completed and duly executed by such Lender or the
Administrative Agent establishing that with respect to
payments of principal, interest or fees hereunder it 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 Administrative Agent of a trade or
business in the United States or (ii) totally exempt or
partially exempt from United States federal withholding tax
under a provision of an applicable tax treaty. Each Lender or
Administrative Agent agrees that it shall, promptly upon a
change of its lending office or the selection of any
additional lending office, to the extent the forms previously
delivered by it pursuant to this section are no longer
effective, and promptly upon the Borrower's or the
Administrative Agent's reasonable request after the occurrence
of any other event (including the passage of time) requiring
the delivery of a Form W-8BEN
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or Form W-8ECI in addition to or in replacement of the forms
previously delivered, deliver to the Borrower and the
Administrative Agent, as applicable, if and to the extent it
is properly entitled to do so, a properly completed and
executed Form W-8BEN or Form W-8ECI (or any successor forms
thereto). Unless the Borrower and the Administrative Agent
have received forms or other documents satisfactory to them
indicating that such payments hereunder or under the other
Loan Documents are not subject to the United States federal
withholding tax, the Borrower or the Administrative Agent
shall withhold taxes from such payments at the applicable
statutory rate, or a reduced rate pursuant to an applicable
tax treaty if such Lender has delivered a form evidencing such
tax treaty benefit.
(c) Notwithstanding paragraph (a) above, neither the
Borrower nor any Guarantor shall be required to pay any
additional amounts to any Lender or the Administrative Agent
for the account of the lending office of such Lender or
Administrative Agent, pursuant to this Section 5.2.2, if (i)
the obligation to pay such additional amounts would not have
arisen but for a failure by such Lender or the Administrative
Agent to comply with the provisions of subsection (b) above;
(ii) the Lender or the Administrative Agent is not eligible,
in respect of such lending office, for complete exemption from
United States federal withholding tax with respect to payments
of interest, principal or fees under this Credit Agreement or
under any of the other Loan Documents, other than by reason of
any change, after the Initial Date, of any applicable law,
treaty or regulation by any governmental authority or other
agency charged with the interpretation or administration
thereof; or (iii) the tax is an income or franchise tax
imposed on net income either by the jurisdiction under which
such Lender or the Administrative Agent is organized or any
political subdivision thereof or in which its principal office
is located or by the jurisdiction of such Lender's or
Administrative Agent's lending office or any political
subdivision thereof. For purposes of this subsection (c), the
term "INITIAL DATE" shall mean, with respect to any Lender or
the Administrative Agent which is a party hereto on the
Effective Date, and with respect to each assignee or
transferee of any Lender, the date of the grant of the
participation in, or transfer or assignment of an interest
hereunder to such assignee or transferee.
5.3. COMPUTATIONS. All computations of interest on the Revolving Credit
Loans other than Eurodollar Rate Loans and of commitment fees, Letter of Credit
Fees or other fees shall, unless otherwise expressly provided herein be based on
a 365/366-day year and paid for the actual number of days elapsed. All
computations of interest on the Eurodollar Rate Loans shall be based on a
360-day year and paid for the actual number of days elapsed. Except as otherwise
provided in the definition of the term "Interest Period" with respect to
Eurodollar Rate Loans, whenever a payment hereunder or under any of the other
Loan Documents becomes due on a day that is not a Business Day, the due date for
such payment shall be extended to the next succeeding Business Day, and interest
shall accrue during such extension. The outstanding amount of the Revolving
Credit Loans as reflected on the Revolving Credit Note Records from time to time
shall be considered correct and binding on the Borrower unless within five (5)
Business Days after receipt of any notice by the Administrative Agent or any of
the Lenders of
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such outstanding amount, the Administrative Agent or such Lender shall notify
the Borrower to the contrary.
5.4. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to the
commencement of any Interest Period relating to any Eurodollar Rate Loan, the
Administrative Agent shall determine or be notified by the Majority Lenders that
adequate and reasonable methods do not exist for ascertaining the Eurodollar
Rate that would otherwise determine the rate of interest to be applicable to any
Eurodollar Rate Loan during any Interest Period, the Administrative Agent shall
forthwith give notice of such determination (which shall be conclusive and
binding on the Borrower and the Lenders) to the Borrower and the Lenders. In
such event (a) any Loan Request or Conversion Request with respect to Eurodollar
Rate Loans shall be automatically withdrawn and shall be deemed a request for
Base Rate Loans, (b) each Eurodollar Rate Loan will automatically, on the last
day of the then current Interest Period relating thereto, become a Base Rate
Loan, and (c) the obligations of the Lenders to make Eurodollar Rate Loans shall
be suspended until the Administrative Agent or the Majority Lenders determines
that the circumstances giving rise to such suspension no longer exist, whereupon
the Administrative Agent or, as the case may be, the Administrative Agent upon
the instruction of the Majority Lenders, shall so notify the Borrower and the
Lenders.
5.5. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Rate Loans, such Lender shall forthwith give notice of such
circumstances to the Borrower and the other Lenders and thereupon (a) the
commitment of such Lender to make Eurodollar Rate Loans or convert Loans of
another Type to Eurodollar Rate Loans shall forthwith be suspended and (b) such
Lender's Revolving Credit Loans then outstanding as Eurodollar Rate Loans, if
any, shall be converted automatically to Base Rate Loans on the last day of each
Interest Period applicable to such Eurodollar Rate Loans or within such earlier
period as may be required by law. The Borrower hereby agrees promptly to pay the
Administrative Agent for the account of such Lender, upon demand by such Lender,
any additional amounts necessary to compensate such Lender for any costs
incurred by such Lender in making any conversion in accordance with this Section
5.5, including any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its Eurodollar Loans hereunder.
5.6. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Lender by any central bank or other fiscal, monetary or
other authority (whether or not having the force of law), shall:
(a) subject any Lender to any tax, levy, impost, duty, charge, fee,
deduction or withholding of any nature with respect to this Credit Agreement,
the other Loan Documents, any Letters of Credit, such Lender's Commitment or
such Lender's Revolving Credit Loans (other than taxes based upon or measured by
the income or profits of such Lender), or
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(b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Lender of the principal of or the
interest on any Revolving Credit Loans or any other amounts payable to any
Lender or the Administrative Agent under this Credit Agreement or any of the
other Loan Documents, or
(c) impose or increase or render applicable (other than to the extent
specifically provided for elsewhere in this Credit Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by or letters of credit issued by,
or commitments of an office of such Lender, or
(d) impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Revolving Credit Loans, such Lender's
Commitment or any class of loans, letters of credit or commitments of which any
of the Revolving Credit Loans or such Lender's Commitment forms a part, and the
result of any of the foregoing is
(i) to increase the cost to any Lender of making, funding,
issuing, renewing, extending or maintaining any of the Revolving Credit
Loans or such Lender's Commitment or any Letter of Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Lender or the
Administrative Agent hereunder on account of such Lender's Commitment,
any Letter of Credit or any of the Revolving Credit Loans, or
(iii) to require such Lender or the Administrative Agent to
make any payment or to forego any interest or Reimbursement Obligation
or other sum payable hereunder, the amount of which payment or foregone
interest or Reimbursement Obligation or other sum is calculated by
reference to the gross amount of any sum receivable or deemed received
by such Lender or the Administrative Agent from the Borrower hereunder,
then, except as otherwise provided in Section 5.2(c), and in each such
case, the Borrower will, upon demand made by such Lender or (as the
case may be) the Administrative Agent at any time and from time to time
and as often as the occasion therefor may arise, pay to such Lender or
the Administrative Agent such additional amounts as will be sufficient
in the good faith opinion of such Lender or the Administrative Agent,
to compensate such Lender or the Administrative Agent for such
additional cost, reduction, payment or foregone interest or
Reimbursement Obligation or other sum. Each Lender shall allocate such
costs (or the effect of such reductions, payments or foregone interest)
among its customers similarly situated in good faith and on an
equitable basis.
5.7. CAPITAL ADEQUACY. If after the date hereof any Lender or the
Administrative Agent determines that (a) the adoption of or change in any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) regarding capital requirements for banks or bank
holding companies or any change in the interpretation or application thereof by
a court or governmental authority with appropriate jurisdiction, or (b)
compliance by such Lender or the Administrative Agent or any corporation
controlling such Lender or the Administrative Agent with any law, governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) of any such entity regarding capital adequacy, has the effect of
reducing the return on such Lender's or the
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Administrative Agent's commitment with respect to any Revolving Credit Loans to
a level below that which such Lender or the Administrative Agent could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's on the Administrative Agent's then existing policies with respect
to capital adequacy and assuming full utilization of such entity's capital) by
any amount deemed by such Lender or (as the case may be) the Administrative
Agent to be material, then such Lender or the Administrative Agent may notify
the Borrower of such fact. To the extent that the amount of such reduction in
the return on capital is not reflected in the Base Rate, the Borrower and such
Lender or the Administrative Agent, as the case may be, shall thereafter attempt
to negotiate in good faith, within thirty (30) days of the day on which the
Borrower receives such notice, an adjustment payable hereunder that will
adequately compensate such Lender or the Administrative Agent, as the case may
be, in light of these circumstances. If the Borrower and such Lender or the
Administrative Agent, as the case may be, are unable to agree to such adjustment
within thirty (30) days of the date on which the Borrower receives such notice,
then commencing on the date of such notice (but not earlier than the effective
date of any such increased capital requirement), the fees payable hereunder
shall increase by an amount that will, in such Lender's reasonable
determination, provide adequate compensation. Each Lender and the Administrative
Agent shall allocate such cost increases among its customers in good faith and
on an equitable basis.
5.8. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Section Section 5.6 or 5.7 and a brief explanation of such
amounts which are due, submitted by any Lender or the Administrative Agent to
the Borrower, shall be conclusive, absent manifest error, that such amounts are
due and owing.
5.9. INDEMNITY. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from and against any loss, cost or expense (including
loss of anticipated profits) that such Lender may sustain or incur as a
consequence of (a) default by the Borrower in payment of the principal amount of
or any interest on any Eurodollar Rate Loans as and when due and payable,
including any such loss or expense arising from interest or fees payable by such
Lender to lenders of funds obtained by it in order to maintain its Eurodollar
Rate Loans, (b) default by the Borrower in making a borrowing or conversion
after the Borrower has given (or is deemed to have given) a Loan Request or a
Conversion Request relating thereto in accordance with Section 2.6 or Section
2.7 or (c) the making of any payment of a Eurodollar Rate Loan or the making of
any conversion of any such Loan to a Base Rate Loan on a day that is not the
last day of the applicable Interest Period with respect thereto, including
interest or fees payable by such Lender to lenders of funds obtained by it in
order to maintain any such Loans. The Borrower hereby authorizes the
Administrative Agent to debit from time to time the Operating Account for the
amount of any such loss, cost or expense.
5.10. INTEREST AFTER DEFAULT.
5.10.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Revolving Credit Loans and
all other overdue amounts payable hereunder or under any of the other
Loan Documents shall bear interest
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compounded monthly and payable on demand at a rate per annum equal to
two percent (2%) above the rate of interest otherwise applicable to
such Revolving Credit Loans pursuant to Section 2.5 until such amount
shall be paid in full (after as well as before judgment).
5.10.2. AMOUNTS NOT OVERDUE. During the continuance of an
Event of Default and upon written notice from the Administrative Agent
to the Borrower, the principal of the Revolving Credit Loans not
overdue and all other amounts not overdue payable hereunder (including,
without limitation, Letter of Credit Fees) or under any of the other
Loan Documents shall, until such Event of Default has been cured or
remedied or such Event of Default has been waived by the Lenders
pursuant to Section 26, bear interest at a rate per annum equal to two
percent (2%) above the rate of interest otherwise applicable to such
Revolving Credit Loans pursuant to Section 2.5 until such amount shall
be paid in full (after as well as before judgment).
5.10.3. MAXIMUM INTEREST. Notwithstanding any other term of
this Credit Agreement or any Revolving Credit Note or any other
document referred to herein or therein, the maximum amount of interest
which may be charged to or collected from any person liable hereunder
or under any Revolving Credit Note by the Lenders shall be absolutely
limited to, and shall in no event exceed, the maximum amount of
interest which could lawfully be charged or collected under applicable
law (including, to the extent applicable, the provisions of Section
5197 of the Revised Statutes of the United States of America, as
amended, 12 U.S.C. Section 85, as amended), so that the maximum of all
amounts constituting interest under applicable law, howsoever computed,
shall never exceed as to any person liable therefor such lawful
maximum, and any term of this Credit Agreement or any Revolving Credit
Note or any other document referred to herein or therein which could be
construed as providing for interest in excess of such lawful maximum
shall be and hereby is made expressly subject to and modified by the
provisions of this paragraph.
5.11. REPLACEMENT LENDERS. Within thirty (30) days after (a) any Lender
has demanded compensation from the Borrower pursuant to Section Section
5.2.2(a), 5.6 or 5.7 hereof, (b) there shall have occurred a change in law with
respect to any Lender as a consequence of which it shall have become unlawful
for such Lender to make a Eurodollar Rate Loan on any Drawdown Date, as
described in Section 5.5 hereof or (c) any Lender shall be a Specified
Non-Consenting Lender (any such Lender described in the foregoing clauses (a),
(b) or (c) is hereinafter referred to as an "AFFECTED LENDER"), the Borrower may
request that the Lenders other than the Affected Lenders (the "NON-AFFECTED
LENDERS") acquire all, but not less than all, of the Affected Lender's
outstanding Revolving Credit Loans and assume all, but not less than all, of the
Affected Lender's Commitment. If the Borrower so requests, the Non-Affected
Lenders may elect to acquire all or any portion of the Affected Lender's
outstanding Revolving Credit Loans and to assume all or any portion of the
Affected Lender's Commitment. If the Non-Affected Lenders do not elect to
acquire and assume all of the Affected Lender's outstanding Revolving Credit
Loans and Commitment, the Borrower may designate a replacement bank or banks,
which must be satisfactory to the Administrative Agent, to acquire and assume
that portion of the outstanding Revolving Credit Loans and Commitment of the
Affected Lender not being acquired and assumed by the Non-Affected Lenders. The
provisions of Section 19 hereof shall apply to all
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reallocations pursuant to this Section 5.11, and the Affected Lender and any
Non-Affected Lenders and/or replacement banks which are to acquire the Revolving
Credit Loans and Commitment of the Affected Lender shall execute and deliver to
the Administrative Agent, in accordance with the provisions of Section 19
hereof, such Assignments and Acceptances and other instruments, including,
without limitation, Revolving Credit Notes, as are required pursuant to Section
19 hereof to give effect to such reallocations. Any Non-Affected Lenders and/or
replacement banks which are to acquire the Revolving Credit Loans and Commitment
of the Affected Lender shall be deemed to be Eligible Assignees for all purposes
of Section 19 hereof. On the effective date of the applicable Assignments and
Acceptances, the Borrower shall pay to the Affected Lender all interest accrued
on its Revolving Credit Loans up to but excluding such date, along with any fees
payable to such Affected Lender hereunder up to but excluding such date.
Section 6. PRIORITY AND COLLATERAL SECURITY; GUARANTY.
6.1. PRIORITY AND COLLATERAL SECURITY.
6.1.1. SUPER-PRIORITY CLAIMS AND COLLATERAL SECURITY. The
Borrower hereby represents, warrants and covenants that, upon entry of
the Interim Order or the Final Order, whichever first occurs, (a) the
Obligations shall at all times constitute a Super-Priority Claim having
priority, pursuant to Section 364(c)(1) of the Bankruptcy Code, subject
only to the Carve Out, and (b) pursuant to Section 364(c)(2), (3) and
(d) (as to liens junior to the liens securing the Prepetition Facility)
of the Bankruptcy Code and the Security Documents, the Obligations
shall at all times be secured by a perfected security interest in
certain of the assets, whether now owned or hereafter acquired of the
Borrower and the Guarantors, pursuant to the terms of the Security
Documents, and (iii) a pledge, for the benefit of the Lenders and the
Administrative Agent, of the capital stock or other equity interests of
the Borrower and each of the Subsidiary Guarantors, PARI PASSU with the
Notes, subject only to (A) Permitted Prior Liens, and (B) the Carve
Out; PROVIDED that the priority of such Lien securing the Obligations,
to the extent the proceeds thereof shall have been used to repay (or
provide cash collateral for) the Prepetition Bank Debt, shall also be
equitably subrogated to such Lien priority as was enjoyed by the Liens
securing the Prepetition Bank Debt prior to the repayment (or cash
collateralization) thereof on the Effective Date. All payments
consisting of administrative, compensation and reimbursement expenses
constituting Priority Professional Expenses or other items included in
the Carve Out shall reduce the Professional Expense Cap or (as the case
may be) the balance of the Carve Out dollar for dollar after the
occurrence and during the continuance of any Default or Event of
Default. The security interests securing the Obligations shall not be
subject to Section 551 of the Bankruptcy Code (other than a security
interest or lien securing the Prepetition Bank Debt).
6.1.2. COLLATERAL SECURITY PERFECTION. The Borrower and each
Guarantor agree to take all actions that the Agents or any Lender may
reasonably request as a matter of nonbankruptcy law to perfect and
protect the Agents' and the Lenders' Liens upon the Collateral and for
such Liens to obtain the priority therefor contemplated hereby,
including, without limitation, executing and delivering such financing
statements, providing such notices and assents of third parties,
obtaining such governmental
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approvals and providing such other instruments and documents in
recordable form as the Agents or any Lender may reasonably request.
6.1.3. NO DISCHARGE; SURVIVAL OF CLAIMS. The Borrower and each
Guarantor agree that (i) the Obligations shall not be discharged by the
entry of an order confirming a Reorganization Plan (and the Borrower
and each Guarantor, pursuant to Section 1141(d)(4) of the Bankruptcy
Code, hereby waive any such discharge), (ii) the Super-Priority Claim
granted to the Agents and the Lenders pursuant to the Orders and the
Liens granted to the Agents and the Lenders pursuant to the Orders and
the Security Documents shall not be affected in any manner by the entry
of an order confirming a Reorganization Plan and (iii) the Borrower and
each Guarantor shall not propose or support any Reorganization Plan, in
each case that is not conditioned upon the payment in full in cash, on
or prior to the earlier to occur of (A) the effective date of such
Reorganization Plan and (B) the Termination Date, of all of the
Obligations, and, with respect to Obligations arising pursuant to
Section 16 or Section 17 after such date, thereafter for the payment in
full of such Obligations in cash when due and payable.
6.1.4. GUARANTEES. The Obligations shall be guaranteed by each
Subsidiary (direct or indirect) of the Borrower pursuant to the terms
of the Guaranty. The Borrower shall notify the Agents of the
acquisition or formation of any new Subsidiary prior to such
acquisition or formation. The Borrower shall, at the request of any
Agent, promptly, and in any event within ten (10) Business Days of such
request, cause each of its Subsidiaries which is not a Guarantor to (i)
execute and deliver to each of the Lenders and the Agents a guaranty
which is substantially in the form of the Guaranty and which is
satisfactory to the Lenders and the Agents in all respects and (ii)
execute and deliver to each of the Lenders and the Agents all other
documents and instruments, including, without limitation, corporate
authority documents and legal opinions, as the Agents may reasonably
request in connection with the delivery of such guaranty.
6.2. GUARANTY. Each Guarantor and the Borrower are members of a group
of related corporations, the success of any one of which is dependent in part on
the success of the other members of such group. Each Guarantor expects to
receive substantial direct and indirect benefit from the Loans advanced and
other credit extended to the Borrower by the Lenders pursuant to this Credit
Agreement (which benefits are hereby acknowledged). It is a condition precedent
to the Lenders' advancing Loans and Letters of Credit to the Borrower under this
Credit Agreement that each Guarantor execute and deliver to the Lender a
guaranty substantially in the form of this Section 6.2. Each Guarantor wishes to
guaranty the Borrower's obligations to the Administrative Agent and the Lenders
under or in respect of the Credit Agreement, each Guarantor hereby agrees with
the Administrative Agent and the Lenders as set forth in this Section 6.2.
6.2.1. GUARANTY OF PAYMENT AND PERFORMANCE. Each Guarantor
hereby jointly and severally guarantees to the Lenders and the
Administrative Agent the full and punctual payment when due (whether at
stated maturity, by required pre-payment, by acceleration or
otherwise), as well as the performance, of all of the Obligations of
the Borrower (referred to in this Section 6.2 as the "Borrower's
Obligations"), including all such which would become due but for the
operation of the automatic stay pursuant to Section 362(a)
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of the Bankruptcy Code and the operation of Section Section 502(b) and
506(b) of the Bankruptcy Code. This Guaranty is an absolute,
unconditional and continuing guaranty of the full and punctual payment
and performance of all of the Borrower's Obligations and not of their
collectibility only and is in no way conditioned upon any requirement
that the Administrative Agent or any Lender first attempt to collect
any of the Borrower's Obligations from the Borrower or any other
Guarantor or resort to any collateral security or other means of
obtaining payment. Should the Borrower default in the payment or
performance of any of the Borrower's Obligations, the obligations of
each Guarantor hereunder with respect to such Borrower's Obligations in
default shall, upon demand by the Administrative Agent, become
immediately due and payable to the Administrative Agent, for the
benefit of the Lenders and the Administrative Agent, without demand or
notice of any nature, all of which are expressly waived by each
Guarantor. Payments by each Guarantor hereunder may be required by the
Administrative Agent on any number of occasions. All payments by each
Guarantor hereunder shall be made to the Administrative Agent, in the
manner and at the place of payment specified therefor in this
Agreement, for the account of the Lenders and the Administrative Agent.
6.2.2. GUARANTORS' AGREEMENT TO PAY ENFORCEMENT COSTS, ETC.
Each Guarantor further agrees, as the principal obligor and not as a
guarantor only, to pay to the Administrative Agent, on demand, all
costs and expenses (including court costs and legal expenses) incurred
or expended by the Administrative Agent or any Lender in connection
with the Obligations, this Guaranty and the enforcement thereof,
together with interest on amounts recoverable under this Section 6.2.2
from the time when such amounts become due until payment, whether
before or after judgment, at the rate of interest for overdue principal
set forth in this Agreement, PROVIDED that if such interest exceeds the
maximum amount permitted to be paid under applicable law, then such
interest shall be reduced to such maximum permitted amount.
6.2.3. WAIVERS BY GUARANTORS; LENDER'S FREEDOM TO ACT. Each
Guarantor agrees that the Obligations will be paid and performed
strictly in accordance with their respective terms, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Administrative Agent
or any Lender with respect thereto. Each Guarantor waives promptness,
diligences, presentment, demand, protest, notice of acceptance, notice
of any Obligations incurred and all other notices of any kind, all
defenses which may be available by virtue of any valuation, stay,
moratorium law or other similar law now or hereafter in effect, any
right to require the marshalling of assets of the Borrower or any other
entity or other person primarily or secondarily liable with respect to
any of the Obligations, and all suretyship defenses generally. Without
limiting the generality of the foregoing, each Guarantor agrees to the
provisions of any instrument evidencing, securing or otherwise executed
in connection with any Obligation and agrees that the obligations of
such Guarantor hereunder shall not be released or discharged, in whole
or in part, or otherwise affected by (i) the failure of the
Administrative Agent or any Lender to assert any claim or demand or to
enforce any right or remedy against the Borrower or any other entity or
other person primarily or secondarily liable with respect to any of the
Obligations; (ii) any extensions, compromise, refinancing,
consolidation or renewals of any Obligation; (iii) any change in the
time, place or manner of payment of any of the Obligations or any
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rescissions, waivers, compromise, refinancing, consolidation or other
amendments or modifications of any of the terms or provisions of this
Credit Agreement, the Revolving Credit Notes, the other Loan Documents
or any other agreement evidencing, securing or otherwise executed in
connection with any of the Obligations, (iv) the addition, substitution
or release of any entity or other person primarily or secondarily
liable for any Obligation; (v) the adequacy of any rights which the
Administrative Agent or any Lender may have against any collateral
security or other means of obtaining repayment of any of the
Obligations; (vi) the impairment of any collateral securing any of the
Obligations, including without limitation the failure to perfect or
preserve any rights which the Administrative Agent or any Lender might
have in such collateral security or the substitution, exchange,
surrender, release, loss or destruction of any such collateral
security; or (vii) any other act or omission which might in any manner
or to any extent vary the risk of any Guarantor or otherwise operate as
a release or discharge of any Guarantor, all of which may be done
without notice to any Guarantor. To the fullest extent permitted by
law, each Guarantor hereby expressly waives any and all rights or
defenses arising by reason of (A) any "one action" or "anti-deficiency"
law which would otherwise prevent the Administrative Agent or any
Lender from bringing any action, including any claim for a deficiency,
or exercising any other right or remedy (including any right of
set-off), against any Guarantor before or after the Administrative
Agent's or such Lender's commencement or completion of any foreclosure
action, whether judicially, by exercise of power of sale or otherwise,
or (B) any other law which in any other way would otherwise require any
election of remedies by the Administrative Agent or any Lender.
6.2.4. UNENFORCEABILITY OF OBLIGATIONS AGAINST BORROWER. If
for any reason the Borrower has no legal existence or is under no legal
obligation to discharge any of the Borrower's Obligations, or if any of
the Borrower's Obligations have become irrecoverable from the Borrower
by reason of the Borrower's insolvency, bankruptcy or reorganization or
by other operation of law or for any other reason, this Guaranty shall
nevertheless be binding on each Guarantor to the same extent as if such
Guarantor at all times had been the principal obligor on all such
Obligations. In the event that acceleration of the time for payment of
any of the Borrower's Obligations is stayed upon the insolvency,
bankruptcy or reorganization of the Borrower, or for any other reason,
all such amounts otherwise subject to acceleration under the terms of
this Credit Agreement, the Revolving Credit Notes, the other Loan
Documents or any other agreement evidencing, securing or otherwise
executed in connection with any Obligation of the Borrower shall be
immediately due and payable by each Guarantors.
6.2.5. SUBROGATION; SUBORDINATION.
6.2.5.1. WAIVER OF RIGHTS AGAINST BORROWER. Until the
indefeasible payment and performance in full of all of the
Borrower's Obligations, no Guarantor shall exercise and each
Guarantor hereby waives any rights against the Borrower
arising as a result of payment by such Guarantor hereunder, by
way of subrogation, reimbursement, restitution, contribution
or otherwise, and will not prove any claim in competition with
the Administrative Agent or any Lender in respect of any
payment hereunder in any bankruptcy, insolvency or
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reorganization case or proceedings of any nature; no Guarantor
will claim any setoff, recoupment or counterclaim against the
Borrower in respect of any liability of such Guarantor to the
Borrower; and each Guarantor waives any benefit of and any
right to participate in any collateral security which may be
held by the Administrative Agent or any Lender.
6.2.5.2. SUBORDINATION. The payment of any amounts
due with respect to any indebtedness of the Borrower for money
borrowed or credit received now or hereafter owed to each
Guarantor is hereby subordinated to the prior payment in full
of all of the Borrower's Obligations. Each Guarantor agrees
that, after the occurrence of any default in the payment or
performance of any of the Borrower's Obligations, each
Guarantor will not demand, xxx for or otherwise attempt to
collect any such indebtedness of the Borrower to such
Guarantor until all of the Borrower's Obligations shall have
been paid in full. If, notwithstanding the foregoing sentence,
any Guarantor shall collect, enforce or receive any amounts in
respect of such indebtedness while any Borrower's Obligations
are still outstanding, such amounts shall be collected,
enforced and received by such Guarantor as trustee for the
Lenders and the Administrative Agent and be paid over to the
Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, on account of the Borrower's Obligations
without affecting in any manner the liability of any Guarantor
under the other provisions of this Guaranty.
6.2.5.3 PROVISIONS SUPPLEMENTAL. The provisions of
this Section 6.2.5 shall be supplemental to and not in
derogation of any rights and remedies of the Lenders and the
Administrative Agent under any separate subordination
agreement which the Administrative Agent may at any time and
from time to time enter into with any Guarantor for the
benefit of the Lenders and the Administrative Agent.
6.2.6. SETOFF. Regardless of the adequacy of any collateral
security or other means of obtaining payment of any of the Borrower's
Obligations, each of the Administrative Agent and the Lenders is hereby
authorized at any time and from time to time, without notice to any
Guarantor (any such notice being expressly waived by each Guarantor)
and to the fullest extent permitted by law, to set off and apply any
deposits and other sums credited by or due from the Administrative
Agent or such Lender to any Guarantor or subject to withdrawal by such
Guarantor against the obligations of any Guarantor under this Guaranty,
whether or not the Administrative Agent or such Lender shall have made
any demand under this Guaranty and although such obligations may be
contingent or unmatured.
6.2.7. FURTHER ASSURANCES. Each Guarantor agrees that it will
from time to time, at the request of the Administrative Agent, do all
such things and execute all such documents as the Administrative Agent
may consider necessary or desirable to give full effect to this
Guaranty and to perfect and preserve the rights and powers of the
Lenders and the Administrative Agent hereunder. Each Guarantor
acknowledges and confirms that such Guarantor itself has established
its own adequate means of obtaining from the
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Borrower on a continuing basis all information desired by such
Guarantor concerning the financial condition of the Borrower and that
each Guarantor will look to the Borrower and not to the Administrative
Agent or any Lender in order for such Guarantor to keep adequately
informed of changes in the Borrower's financial condition.
6.2.8. TERMINATION; REINSTATEMENT. This Guaranty shall remain
in full force and effect until all of the Borrower's Obligations have
been irrevocably paid in full in cash and all commitments under this
Credit Agreement have been terminated. This Guaranty shall continue to
be effective or be reinstated, if at any time any payment made or value
received with respect to any Borrower's Obligation is rescinded or must
otherwise be returned by the Administrative Agent or any Lender upon
the insolvency, bankruptcy or reorganization of the Borrower, or
otherwise, all as though such payment had not been made or value
received.
6.2.9. SUCCESSORS AND ASSIGNS. This Guaranty shall be binding
upon each Guarantor, its successors and assigns, and shall inure to the
benefit of the Administrative Agent and the Lenders and their
respective successors, transferees and assigns. Without limiting the
generality of the foregoing sentence, each Lender may assign or
otherwise transfer this Agreement, the Revolving Credit Notes, the
other Loan Documents or any other agreement or note held by it
evidencing, securing or otherwise executed in connection with the
Borrower's Obligations, or sell participations in any interest therein,
to any other entity or other person, and such other entity or other
person shall thereupon become vested, to the extent set forth in the
agreement evidencing such assignment, transfer or participation, with
all the rights in respect thereof granted to such Lender herein, all in
accordance with Section 19 of this Agreement. No Guarantor may assign
any of its obligations hereunder.
Section 7. REPRESENTATIONS AND WARRANTIES. The Borrower (and, where
applicable, the Parent), represents and warrants to the Lenders and the Agents
as follows:
7.1. CORPORATE AUTHORITY.
7.1.1. INCORPORATION; GOOD STANDING. Each of the Parent, the
Borrower and their respective Subsidiaries (a) is a corporation or
limited liability company duly organized, validly existing and in good
standing under the laws of its state or other jurisdiction of
incorporation or organization, (b) has all requisite corporate or
limited liability company power to own its property and conduct its
business as now conducted and as presently contemplated, and (c) is in
good standing as a foreign corporation or limited liability company and
is duly authorized to do business in each jurisdiction where such
qualification is necessary except where a failure to be so qualified
would not have a Material Adverse Effect.
7.1.2. AUTHORIZATION. The execution, delivery and performance
by the Parent, the Borrower and their respective Subsidiaries of this
Credit Agreement and the other Loan Documents to which it is a party
and the transactions contemplated hereby and thereby (a) are within the
corporate or limited liability company authority of such Person, (b)
have been duly authorized by all necessary corporate or limited
liability company proceedings, (c) do not conflict with or result in
any breach or contravention of
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any provision of law, statute, rule or regulation to which such Person
is subject or any judgment, order, writ, injunction, license or permit
applicable to such Person where such conflict, breach or contravention
could reasonably be expected to have a Material Adverse Effect and (d)
do not conflict with any provision of the corporate charter or bylaws
of, or any agreement or other instrument binding upon, such Person
where such conflict could reasonably be expected to have a Material
Adverse Effect.
7.1.3. ENFORCEABILITY. The execution and delivery by the
Parent, the Borrower and their respective Subsidiaries of this Credit
Agreement and the other Loan Documents to which it is a party will,
upon entry of the Interim Order or the Final Order, whichever occurs
first, result in valid and legally binding obligations of such Person
enforceable against such Person in accordance with the respective terms
and provisions hereof and thereof, except as enforceability is limited
by bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting generally the enforcement of creditors' rights
and except to the extent that availability of the remedy of specific
performance or injunctive relief is subject to the discretion of the
court before which any proceeding therefor may be brought.
7.2. GOVERNMENTAL APPROVALS. Except for the entry of the Interim Order
or the Final Order, whichever occurs first, the execution, delivery and
performance by the Parent, the Borrower and their respective Subsidiaries of
this Credit Agreement and the other Loan Documents to which it is party and the
transactions contemplated hereby and thereby do not require the approval or
consent of, or filing with, any governmental agency or authority which have not
been obtained except for those which the failure to obtain the same could
reasonably be expected to have a Material Adverse Effect.
7.3. TITLE TO PROPERTIES; LEASES. Except as indicated on SCHEDULE 7.3
hereto, the Borrower and each of its Subsidiaries own all of the assets
reflected in the consolidated balance sheet of the Borrower and its Subsidiaries
as at the Balance Sheet Date, or acquired since such date (except (i) property
and assets sold or otherwise disposed of in the ordinary course of business
since that date or otherwise permitted hereunder and (ii) minor defects in title
that do not interfere with the Borrower's ability to conduct its business or
utilize such assets), subject to no rights of others, including any mortgages,
leases, conditional sales agreements, title retention agreements, liens or other
encumbrances except Permitted Liens.
7.4. FINANCIAL STATEMENTS AND PROJECTIONS.
7.4.1. FINANCIAL STATEMENTS. There has been furnished to each
of the Lenders a consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 1999, and a consolidated statement of
income of the Borrower and its Subsidiaries for the fiscal year ended
December 31, 1999, certified by Deloitte & Touche. There has also been
furnished to each of the Lenders, a management prepared consolidated
balance sheet of the Borrower and its Subsidiaries as at the Balance
Sheet Date, and the consolidated statement of income of the Borrower
and its Subsidiaries for the period then ended. Such balance sheets and
statements of income have been prepared in accordance with generally
accepted accounting principles and fairly present the financial
condition of the Borrower as at the close of business on such dates and
the results of operations for the fiscal years then ended, subject, in
the case of unaudited financial statements, to changes
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resulting from audit and normal year end adjustments. There are no
contingent liabilities of the Borrower or any of its Subsidiaries as of
such date involving material amounts, known to the officers of the
Borrower, which were not disclosed in such balance sheets and the notes
related thereto.
7.4.2. PROJECTIONS. The projections of the annual operating
budgets of the Borrower and its Subsidiaries on a consolidated basis,
calculated on a monthly basis, including monthly balance sheets, income
statements, borrowing base availability and cash flow statements for
the 2001 through 2002 fiscal years and the annual operating budgets of
the Borrower and its Subsidiaries on a consolidated basis, annual
balance sheets, income statements and borrowing base availability and
cash flow statements for the 2000 through 2002 fiscal years have been
delivered to each Lender. To the knowledge of the Borrower or any of
its Subsidiaries, no facts exist that (individually or in the
aggregate) would as of the Effective Date, result in any material
change in any of such projections. The projections (including any
updated projections) are based upon reasonable estimates and
assumptions, have been prepared on the basis of the assumptions stated
therein and reflect the reasonable estimates of the Borrower and its
Subsidiaries of the results of operations and other information
projected therein.
7.4.3. CASH BUDGET. The Borrower has delivered to each of the
Lenders its cash budget (as the same may be amended from time to time
with the consent of the Agents, the "CASH BUDGET"), and its forecast of
the cash flows, results of operations and loan availability of the
Borrower, each on a monthly for the period from January 1, 2001 through
December 31, 2002, and the Cash Budget has been prepared in good faith,
based upon reasonable assumptions.
7.5. NO MATERIAL CHANGES, ETC. Except for the commencement of the
Cases, since the Balance Sheet Date there has occurred no materially adverse
change in the consolidated financial condition or business of the Borrower and
its Subsidiaries as shown on or reflected in the consolidated balance sheet of
the Borrower and its Subsidiaries as at the Balance Sheet Date, or the
consolidated statement of income for the fiscal year then ended, other than
changes in the ordinary course of business or contemplated herein that have not
had any material adverse effect in the aggregate on the business or financial
condition of the Borrower or any of its Subsidiaries, taken as a whole. Since
the Balance Sheet Date, the Borrower has not made any Distribution.
7.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Borrower and its
Subsidiaries possesses all franchises, patents, copyrights, trademarks, trade
names, licenses and permits, and rights in respect of the foregoing, adequate
for the conduct of its business substantially as now conducted without known
conflict with any rights of others except where failure to do so would not have
a Material Adverse Effect.
7.7. LITIGATION. Except for the Cases and as set forth in SCHEDULE 7.7
hereto, there are no actions, suits, proceedings or investigations of any kind
pending or threatened against the Borrower or any of its Subsidiaries before any
court, tribunal or administrative agency or board that would be reasonably
likely to, either in any case or in the aggregate, materially adversely affect
the properties, assets, financial condition or business of the Borrower and its
Subsidiaries, taken as a whole, or materially impair the right of the Borrower
and its Subsidiaries, taken as a
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whole, to carry on the business conducted by them, or which question the
validity of this Credit Agreement or any of the other Loan Documents.
7.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the Borrower nor any
of its Subsidiaries is subject to any charter, corporate or other legal
restriction (including any legal restrictions created by any other
organizational document of the Borrower or any of its Subsidiaries), or any
judgment, decree, order, rule or regulation that has or is expected in the
future to have a materially adverse effect on the business, assets or financial
condition of the Borrower or any of its Subsidiaries. Neither the Borrower nor
any of its Subsidiaries is a party to any contract or agreement that has or is
expected to have any materially adverse effect on the business of the Borrower
or any of its Subsidiaries.
7.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the Borrower
nor any of its Subsidiaries is in violation of any provision of its charter
documents, bylaws, or any agreement or instrument to which it is subject or by
which it or any of its properties is bound or any decree, order, judgment,
statute, license, rule or regulation, in any of the foregoing cases in a manner
that would reasonably be expected to have a Material Adverse Effect.
7.10. TAX STATUS. The Borrower and its Subsidiaries (a) have made or
filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which any of them is subject,
(b) have paid all material taxes and other governmental assessments and charges
shown or determined to be due on such returns, reports and declarations, except
those being contested in good faith and by appropriate proceedings or those
having an aggregate principal amount of $10,000,000 or less and (c) have
established on their books provisions reasonably adequate for the payment of all
material taxes for periods subsequent to the periods to which such returns,
reports or declarations apply. There are no unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Borrower know of no basis for any such claim.
7.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
7.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither the Borrower
nor any of its Subsidiaries is a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
7.13. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Permitted Liens and financing statements filed to give notice that the Borrower
holds certain raw materials on consignment from vendors or to give notice of
operating leases permitted under Section 9.1(f), there is no financing
statement, security agreement, chattel mortgage, real estate mortgage or other
document filed or recorded with any filing records, registry or other public
office, that purports to cover, affect or give notice of any present or possible
future lien on, or security interest in, any assets or property of the Borrower
or any rights relating thereto other than financing statements that have not yet
been released of record relating to Indebtedness that has been repaid in full.
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7.14. EMPLOYEE BENEFIT PLANS.
7.14.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance
in all material respects with the provisions of ERISA and, to the
extent applicable, the Code.
7.14.2. GUARANTEED PENSION PLANS. Each contribution required
to be made to a Guaranteed Pension Plan, to avoid the notice or lien
provisions of Section 302(f) of ERISA, and each other contribution
required to be made to a Guaranteed Pension Plan to avoid a Material
Adverse Effect, has been timely made. No waiver of an accumulated
funding deficiency or extension of amortization periods has been
received with respect to any Guaranteed Pension Plan, and neither the
Borrower nor any ERISA Affiliate is obligated to or has posted security
in connection with an amendment of a Guaranteed Pension Plan pursuant
to Section 307 of ERISA or Section 401(a)(29) of the Code, other than
as would not be reasonably likely to result in a Material Adverse
Effect. No liability to the PBGC (other than required insurance
premiums, has been incurred by the Borrower or any ERISA Affiliate with
respect to any Guaranteed Pension Plan, other than as would not be
reasonably likely to result in a Material Adverse Effect and there has
not been any ERISA Reportable Event with respect to which the
requirement of thirty (30) days notice has not been waived, or any
other event or condition which presents a material risk of termination
of any Guaranteed Pension Plan by the PBGC. Based on the latest
valuation of each Guaranteed Pension Plan (which in each case occurred
within twelve months of the date of this representation), and on the
actuarial methods and assumptions employed for that valuation, the
aggregate present value of accumulated benefits of all such Guaranteed
Pension Plans did not exceed the aggregate value of the assets of all
such Guaranteed Pension Plans, disregarding for this purpose the
accumulated benefits and assets of any Guaranteed Pension Plan with
assets in excess of accumulated benefits, by more than an amount
reasonably likely to result in a Material Adverse Effect.
7.14.3. MULTIEMPLOYER PLANS. Neither the Borrower nor any
ERISA Affiliate has incurred any unsatisfied liability (including
secondary liability) to any Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan under
Section 4201 of ERISA or as a result of a sale of assets described in
Section 4204 of ERISA other than such amounts of liability as in
aggregate would not be reasonably likely to result in a Material
Adverse Effect. Neither the Borrower nor any ERISA Affiliate has been
notified that any Multiemployer Plan is in reorganization or insolvent
under and within the meaning of Section 4241 or Section 4245 of ERISA
or is at risk of entering reorganization or becoming insolvent, or that
any Multiemployer Plan intends to terminate or has been terminated
under Section 4041A of ERISA other than as would not be reasonably
likely to result in a Material Adverse Effect.
7.15. USE OF PROCEEDS.
7.15.1. GENERAL. The proceeds of the Revolving Credit Loans
shall be used, and the Borrower will obtain Letters of Credit, on the
Effective Date, to refinance existing indebtedness of the Borrower
under the Prepetition Credit Agreement, together with all
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accrued interest and fees thereon as of the Effective Date, and
thereafter, for Capital Expenditures and for working capital and
general corporate purposes.
7.15.2. REGULATIONS U AND X. No portion of any Revolving
Credit Loan is to be used, and no portion of any Letter of Credit is to
be obtained, for the purpose of purchasing or carrying any "margin
security" or "margin stock" as such terms are used in Regulations U and
X of the Board of Governors of the Federal Reserve System, 12 C.F.R.
Parts 221 and 224.
7.16. ENVIRONMENTAL COMPLIANCE. Except as previously disclosed to the
Lenders in writing or as set forth on SCHEDULE 7.16 attached hereto, to the
knowledge of the Borrower:
(a) none of the Borrower, its Subsidiaries or any operator of the Real
Estate or any operations thereon has received a notice that it is in violation
of any applicable Environmental Law, which includes the Resource Conservation
and Recovery Act ("RCRA"), the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 as amended ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water
Act, the Federal Clean Air Act, the Toxic Substances Control Act, and any
analogous state or local statute, regulation, ordinance, or order or decree
(including, without limitation, the Corrective Action Order entered into under
RCRA on June 16, 1999 between the EPA and RES relating to RES's facilities in
Canton, Ohio) to which the Borrower or any of its Subsidiaries is a party
relating to health, safety (as relating to the environment or Hazardous
Substances) or the environment (hereinafter "ENVIRONMENTAL LAWS"), which
violation would have a Material Adverse Effect;
(b) neither the Borrower nor any of its Subsidiaries has received
notice from any third party including, without limitation: any federal, state or
local governmental authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency ("EPA") as a potentially
responsible party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X; (ii) that any hazardous waste,
as defined by 42 U.S.C. Section 6903(5), any hazardous substances as defined by
42 U.S.C. Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) and any toxic substances, oil or hazardous materials or other
chemicals or substances regulated by any Environmental Laws ("HAZARDOUS
SUBSTANCES") which any one of them has generated, transported or disposed of has
been found at any site at which a federal, state or local agency or other third
party has conducted or has ordered that any Borrower or any of its Subsidiaries
conduct a remedial investigation, removal or other response action pursuant to
any Environmental Law which would result in expenditures in excess of
$5,000,000; or (iii) that it is or shall be a named party to any claim, action,
cause of action, complaint, or legal or administrative proceeding (in each case,
contingent or otherwise) arising out of any third party's incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with the
release of Hazardous Substances on the Real Estate or generated, transported or
disposed of by the Borrower or any of its Subsidiaries which would result in
expenditures in excess of $5,000,000;
(c) except where non-compliance would not have a Material Adverse
Effect, (i) no portion of the Real Estate has been used by the Borrower or any
of its Subsidiaries for the handling, processing, storage or disposal of
Hazardous Substances except in compliance with applicable Environmental Laws;
and no underground tank or other underground storage
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receptacle for Hazardous Substances is located on any portion of the Real
Estate; (ii) in the course of any activities conducted by the Borrower, its
Subsidiaries or operators of its properties, no Hazardous Substances have been
discharged, emitted, generated or used except in accordance with applicable
Environmental Laws; (iii) in addition, to the extent required by applicable
Environmental Law, any Hazardous Substances that have been transported from the
Real Estate have been transported offsite only by carriers having an
identification number issued by the EPA, treated or disposed of only by
treatment or disposal facilities maintaining valid permits as required under
applicable Environmental Laws, which transporters and facilities have been and
are, to the best of the Borrower's knowledge, operating in compliance with such
permits and applicable Environmental Laws; (iv) there have been no releases
(i.e., any past or present releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, disposing or dumping) or
threatened releases of Hazardous Substances on, upon, into or from the
properties of the Borrower or its Subsidiaries, which releases would have a
material adverse effect on the value of the Real Estate or adjacent properties
or the environment; and (v) to the best of Borrower's knowledge, there have been
no releases on, upon, from or into any real property in the vicinity of any of
the Real Estate which, through soil or groundwater contamination, may have come
to be located on, and which would have a material adverse effect on the value
of, the Real Estate; and
(d) none of the Borrower and its Subsidiaries nor any of the Real
Estate is subject to any applicable environmental law requiring the performance
of Hazardous Substances site assessments or the removal or remediation of
Hazardous Substances, or the giving of notice to any governmental agency or the
recording or delivery to other Persons of an environmental disclosure document
or statement by virtue of the transactions set forth herein and contemplated
hereby.
7.17. SUBSIDIARIES, ETC. RTI Capital Corp., Nimishillen & Tuscarawas,
LLC, Bliss & Xxxxxxxx, LLC, Canadian Drawn Steel Company Inc. and the Oberlin
Insurance Company are the only Subsidiaries of the Borrower on the Effective
Date. Except as set forth on SCHEDULE 7.17 hereto, neither the Borrower nor any
Subsidiary of the Borrower is engaged in any joint venture or partnership with
any other Person on the Effective Date.
7.18. BANK ACCOUNTS; AGENCY ACCOUNT ARRANGEMENTS. SCHEDULE 7.18 sets
forth the account numbers and location of all bank accounts of the Borrower or
any of its Subsidiaries. The Borrower and its Subsidiaries have delivered to the
Administrative Agent, for the benefit of the Administrative Agent and the
Lenders, Agency Agreements in form and substance reasonably satisfactory to the
Administrative Agent (collectively, the "AGENCY AGREEMENTS") for each financial
institution (each a "BLOCKED ACCOUNT BANK") with which the Borrower and its
Subsidiaries maintains any Swept Accounts or other accounts with respect to
which the Administrative Agent has determined that the execution of an Agency
Agreement is advisable (collectively, together with the Swept Accounts, the
"BLOCKED ACCOUNTS").
7.19. FISCAL YEAR. The Borrower has a fiscal year which ends on
December 31 in each year.
7.20. DISCLOSURE. No representation or warranty made by the Borrower in
any of the Loan Documents or any agreement, instrument, document, certificate or
letter furnished by or on behalf of the Borrower pursuant to any Loan Document
or in connection with any of the
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transactions contemplated thereby when taken as a whole with all other such
representations and warranties contains any untrue statement of any material
fact or omits to state any material fact necessary in order to make the
statement contained therein not misleading. There is no fact known to the
Borrower (excluding general industry, economic and political conditions) which
materially adversely affects, or which could reasonably be expected to
materially adversely affect in the reasonable foreseeable future the financial
condition, business, operations, or affairs or the Borrower, which has not been
disclosed in writing to the Administrative Agent.
7.21. PERFECTION OF SECURITY INTEREST. Except for matters contemplated
by Section 8.19, upon the entry of the Interim Order or the Final Order,
whichever occurs first, all filings, assignments, pledges and deposits of
documents or instruments will have been made and all other actions will have
been taken that are necessary or advisable, under applicable law, to establish
and perfect the Administrative Agent's security interest in the Collateral. The
Collateral and the Administrative Agent's rights with respect to the Collateral
are not subject to any setoff, claims, withholdings, or other defenses. The
Borrower or a Guarantor party to any Security Document is the owner of the
Collateral, free from any lien, security interest, encumbrance, or any other
claim or demand, except for Permitted Liens.
7.22. FILED ENTITIES. All Subsidiaries (other than Nimishillen &
Tuscarawas, LLC and Canadian Drawn Steel Company Inc.) are subject as debtors to
a Case in the Bankruptcy Court and all Subsidiaries are Guarantors hereunder.
8. AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower covenants and
agrees that, so long as any Revolving Credit Loan, Letter of Credit or Revolving
Credit Note is outstanding or any Lender has any obligation to make any
Revolving Credit Loans or the Issuing Bank has any obligation to issue, extend
or renew any Letters of Credit:
8.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Revolving Credit Loans, all
Reimbursement Obligations, the Letter of Credit Fees, the commitment fees, the
Administrative Agent's fee and all other amounts provided for in this Credit
Agreement and the other Loan Documents, all in accordance with the terms of this
Credit Agreement and such other Loan Documents.
8.2. MAINTENANCE OF OFFICE. The Borrower will maintain its chief
executive office in 0000 Xxxxxxx Xxxxxxx, Xxxxx, XX 00000, or at such other
place in the United States of America as the Borrower shall designate upon
written notice to the Administrative Agent, where notices, presentations and
demands to or upon the Borrower in respect of the Loan Documents to which the
Borrower is a party may be given or made.
8.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and cause each
of its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with generally
accepted accounting principles and (b) maintain adequate accounts and reserves
for all taxes (including income taxes), depreciation, depletion, obsolescence
and amortization of its properties and the properties of its Subsidiaries,
contingencies, and other reserves.
8.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower
will deliver to each of the Agents for distribution to each of the Lenders:
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(a) as soon as practicable, but in any event not later than ninety (90)
days after the end of each fiscal year (or portion thereof) of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries and the
consolidating balance sheet of the Borrower and its Subsidiaries, each as at the
end of such year, and the related consolidated statement of income and retained
earnings and consolidated statement of cash flow and consolidating statement of
income and retained earnings and consolidating statement of cash flow for such
year, each setting forth in comparative form the figures set forth in the
projections delivered pursuant to Section 7.4.2 (or, if updated, pursuant to
Section 8.4(l)) for the comparable period and, to the extent available, those
figures for the previous fiscal year and all such consolidated and consolidating
statements to be in reasonable detail, prepared in accordance with generally
accepted accounting principles, and, with respect to the consolidated financial
statements, certified without qualification (except for qualification for a
change in accounting principles with which the independent public accountant
concurs) by a nationally recognized firm of independent certified public
accountants satisfactory to the Administrative Agent, together with a written
statement from such accountants to the effect that they have read a copy of this
Credit Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event of
Default, or, if such accountants shall have obtained knowledge of any then
existing Default or Event of Default they shall disclose in such statement any
such Default or Event of Default; PROVIDED that such accountants shall not be
liable to the Lenders for failure to obtain knowledge of any Default or Event of
Default;
(b) as soon as practicable, but in any event not later than forty-five
(45) days after the end of each of the fiscal quarters of the Borrower, copies
of the unaudited consolidated balance sheet of the Borrower and its Subsidiaries
as at the end of such quarter, and the related consolidated statement of income
and retained earnings and consolidated statement of cash flow for the portion of
the Borrower's fiscal year then elapsed, each setting forth in comparative form
the figures set forth in the projections delivered pursuant to Section 7.4.2
(or, if updated, pursuant to Section 8.4(l)) for the comparable period and, to
the extent available, those figures for the comparable period in the preceding
fiscal year, all in reasonable detail and prepared in accordance with generally
accepted accounting principles, together with a certification by the treasurer
or other authorized financial officer of the Borrower that the information
contained in such financial statements fairly presents the financial position of
the Borrower and its Subsidiaries on the date thereof (subject to year-end
adjustments and the exclusion of footnotes);
(c) as soon as practicable, but in any event not later than thirty (30)
days after the end of each month, in each fiscal year of the Borrower, copies of
the unaudited monthly consolidated balance sheet of the Borrower and its
Subsidiaries for such month, and the related consolidated statement of income
and retained earnings and consolidated statement of cash flow for the portion of
the Borrower's fiscal year then elapsed, each setting forth in comparative form
the figures set forth in the projections delivered pursuant to Section 7.4.2
(or, if updated, pursuant to Section 8.4(l)) for the comparable period and, to
the extent available, those figures for the comparable period in the preceding
fiscal year, all in reasonable detail and prepared in accordance with generally
accepted accounting principles, together with a certification by the treasurer
or other authorized financial officer of the Borrower that the information
contained in such financial statements fairly presents the financial condition
of the Borrower and its
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Subsidiaries on the date thereof (subject to year-end adjustments and the
exclusion of footnotes);
(d) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by the
treasurer or other authorized financial officer of the Borrower in substantially
the form of EXHIBIT D hereto (the "COMPLIANCE CERTIFICATE") and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in Section 10 and (if applicable) (i) reconciliations to reflect
changes in generally accepted accounting principles since the Balance Sheet
Date, and (ii) reconciliations to generally accepted accounting principles of
any amounts shown on a marked to market basis, and on a quarterly basis, a
report in form and substance reasonably satisfactory to the Administrative
Agent, on the status of environmental matters affecting the Borrower, including
any material changes in remedial activity requested by any governmental agency
or authority and the impact, if any, of such changes on the budget for the year
delivered pursuant to subsection (h) below;
(e) simultaneously with delivery of the financial statements referred
to in subsections (a) and (b), a certificate, executed by the treasurer or other
authorized financial officer of the Borrower, stating that such officer has
caused this Credit Agreement to be reviewed and has no knowledge of any material
default by the Borrower in the performance or observance of any of the
provisions of this Credit Agreement, during the applicable quarter or at the end
of the applicable year, or, if such officer has such knowledge, specifying each
default and the nature thereof;
(f) promptly upon receipt thereof, copies of all final management
letters of substance and other material reports of substance which are submitted
to the Borrower by its independent accountants in connection with any annual or
interim audit of the books of the Borrower made by such accountants;
(g) as soon as practicable but, in any event, within ten (10) Business
Days after the issuance thereof, copies of such other financial statements and
reports as the Borrower shall send to its stockholders as such, and copies of
all regular and periodic reports which the Borrower may be required to file with
the Securities and Exchange Commission or any similar or corresponding
governmental commission, department or agency substituted therefor, or any
similar or corresponding governmental commission, department, board, bureau, or
agency, federal or state;
(h) within thirty (30) days after the first day of each fiscal year of
the Borrower, its budget, including quarterly balance sheets, income statements,
borrowing base availability and cash flow statements for the Borrower and its
Subsidiaries for such fiscal year prepared by the Borrower for its Board of
Directors or similar authority, which shall include detail by quarter and shall
include projected spending for such year relating to Capital Expenditures,
including with respect to environmental matters affecting the Borrower;
(i) on a daily basis, a Borrowing Base Report setting forth the
Borrowing Base as at the end of the preceding day;
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(j) on Wednesday of each week, (i) an Accounts Receivable aging report,
(ii) a Borrowing Base Report setting forth the Borrowing Base with inventory
updated through the end of the preceding week, (iii) a consolidated thirteen
(13) week rolling cash flow forecast of the Borrower and its Subsidiaries in
form and substance reasonably satisfactory to the Agents, (iv) a cash flow
report showing actual performance for each weekly period reflected in the Cash
Budget and variance of actual performance from projected performance in the Cash
Budget, (v) weekly flash report in form and substance satisfactory to the
Agents, (vi) an inventory report, and (vii) an accounts payable aging report
(including post-petition accounts payable);
(k) within twenty (20) days after the end of each calendar month, a
Borrowing Base Report setting forth the Borrowing Base as at the end of the
preceding month;
(l) simultaneously with delivery of each annual budget pursuant to
Section 8.4(h) and from time to time upon request of the Administrative Agent,
projections of the Borrower and its Subsidiaries (including, without limitation,
as to availability of the Revolving Credit Loans) updating those projections
delivered to the Lenders and referred to in Section 7.4.2 or, if applicable,
updating any later such projections delivered pursuant to this Section 8.4(l);
(m) from time to time such other financial data and information
(including accountants and management letters) as the Administrative Agent or
any Lender may reasonably request;
(n) as soon as practicable, but in any event not later than forty-five
(45) days after notice by the Administrative Agent made after determining in its
discretion that an appraisal or reappraisal of the value of the Canton Cast-Roll
Facility or Eligible Inventory of the Borrower or any Subsidiary of the Borrower
is necessary to ensure the accuracy of the Borrowing Base, an appraisal or
reappraisal, as the case may be, of the value of the Canton Cast-Roll Facility
or Eligible Inventory, which appraisal or reappraisal shall be conducted by the
Administrative Agent or its designee at the expense of the Borrower or such
Subsidiary by an appraiser retained by the Administrative Agent or its designee
in form and substance satisfactory to the Administrative Agent; and
(o) promptly, copies of all material pleadings, notices, orders and
other papers filed in the Cases and copies of all reports filed with the United
States Trustee in the Cases.
8.5. NOTICES.
8.5.1. DEFAULTS. The Borrower will promptly notify the
Administrative Agent and each of the Lenders in writing of the
occurrence of any Default or Event of Default. If any Person shall give
any notice or take any other action in respect of a claimed default
(whether or not constituting an Event of Default) under this Credit
Agreement or any other note, evidence of indebtedness, indenture or
other obligation, the amount of which is in excess of $500,000, to
which or with respect to which the Borrower or any of its Subsidiaries
is a party or obligor, whether as principal, guarantor, surety or
otherwise, the Borrower shall forthwith give written notice thereof to
the Administrative Agent and each of the Lenders, describing the notice
or action and the nature of the claimed default.
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8.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly give
written notice to the Administrative Agent and each of the Lenders (i)
of any violation of any Environmental Law that the Borrower or any of
its Subsidiaries reports in writing or is reportable by the Borrower or
any of its Subsidiaries in writing (or for which any written report
supplement to any oral report is made) to any federal, state or local
environmental agency and (ii) upon becoming aware thereof of any
inquiry, proceeding, investigation, or notice of violation, or order
from any agency of potential environmental liability, or any federal,
state or local environmental agency or board, that, in the case of
either (i) or (ii) above, would reasonably be expected to materially
adversely affect the assets, liabilities, financial conditions or
operations of the Borrower and its Subsidiaries, taken as a whole, or
the Administrative Agent's security interests pursuant to the Security
Documents.
8.5.3. NOTIFICATION OF CLAIM AGAINST COLLATERAL. The Borrower
will, immediately upon becoming aware thereof, notify the
Administrative Agent and each of the Lenders in writing of any setoff,
claims (including, with respect to the Real Estate, environmental
claims in excess of $500,000), withholdings or other defenses to which
any of the Collateral, or the Administrative Agent's rights with
respect to the Collateral, are subject.
8.5.4. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause each of its Subsidiaries to, give notice to the
Administrative Agent and each of the Lenders in writing within fifteen
(15) days of becoming aware of any litigation or proceedings threatened
in writing or any pending litigation and proceedings affecting the
Borrower or any of its Subsidiaries or to which the Borrower or any of
its Subsidiaries is or becomes a party involving an uninsured claim
against the Borrower or any of its Subsidiaries that could reasonably
be expected to have a materially adverse effect on the Borrower or any
of its Subsidiaries and stating the nature and status of such
litigation or proceedings. The Borrower will, and will cause each of
its Subsidiaries to, give notice to the Administrative Agent and each
of the Lenders, in writing, in form and detail satisfactory to the
Administrative Agent, within twenty (20) days of any judgment not
covered by insurance, final or otherwise, against the Borrower or any
of its Subsidiaries in an amount in excess of $500,000.
8.5.5. NOTICES CONCERNING INVENTORY COLLATERAL. The Borrower
shall provide to the Administrative Agent prompt notice of (i) any
physical count of the Borrower's or any of its Subsidiaries' inventory,
together with a copy of the results thereof certified by the Borrower
or such Subsidiary, (ii) any determination by the Borrower or any of
its Subsidiaries that the inventory levels of the Borrower or such
Subsidiary are not adequate to meet the sales projections of the
Borrower or such Subsidiary, and (iii) any failure of the Borrower or
any of its Subsidiaries to pay rent at any location, which failure
continues for more than five days following the day on which such rent
is due and payable by the Borrower or such Subsidiary. If so requested
by the Administrative Agent or any Lender, the Borrower shall provide
to the Administrative Agent or such Lender copies of all advertising by
the Borrower or any of its Subsidiaries including copies of all print
advertising and duplicate tapes of all video and radio advertising.
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8.6. EXISTENCE; MAINTENANCE OF PROPERTIES. Except as otherwise
permitted by Section 9.5 or Section 9.6, the Borrower will do or cause to be
done all things necessary to preserve and keep in full force and effect its
limited liability company existence and material rights and franchises and the
corporate or limited liability company existence and material rights and
franchises of its Subsidiaries. It (a) will cause all of its properties and
those of its Subsidiaries material to the conduct of its business or the
business of its Subsidiaries to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment (ordinary wear and
tear excepted), (b) will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, and (c)
will, and will cause each of its Subsidiaries to, continue to engage primarily
in the businesses now conducted by them and in related businesses; PROVIDED that
nothing in this Section 8.6 shall prevent the Borrower from discontinuing the
operation and maintenance of any of its properties or any of those of its
Subsidiaries if such discontinuance is, in the judgment of the Borrower,
desirable in the conduct of its or their business and that do not in the
aggregate materially adversely affect the business of the Borrower and its
Subsidiaries on a consolidated basis.
8.7. INSURANCE.
(a) The Borrower will and will cause each of its Subsidiaries to
maintain with an insurer rated B+ or better by A.M. Best, insurance with respect
to its properties and business against such casualties and contingencies as
shall be in accordance with sound business practices of businesses engaged in
similar activities in similar geographic areas. Such insurance shall be in such
minimum amounts that the Borrower will not be deemed a co-insurer under
applicable insurance laws, regulations and policies and otherwise shall be in
such amounts, contain such terms, be in such forms and be for such periods as
may be reasonably satisfactory to the Administrative Agent. In addition, all
insurance (except third party liability insurance) insuring any of the
Collateral and the interruption of the business of the Borrower shall be payable
to the Administrative Agent (subject to the rights of other creditors to receive
such business interruption insurance) as a loss payee under a standard loss
payee clause for the benefit of the Lenders and the Administrative Agent and
shall designate the Administrative Agent as an additional insured, as
applicable. Without limiting the foregoing, the Borrower will, and will cause
each of its Subsidiaries to, (i) keep all of its physical property insured with
casualty or physical hazard insurance on an "all risks" basis, with broad form
flood and earthquake coverages and electronic data processing coverage, with a
full replacement cost endorsement and an "agreed amount" clause in an amount
equal to 100% of the full replacement cost of such property exclusive of
deductibles and self insurance in amounts not greater than those generally
maintained by businesses engaged in similar activities in similar geographic
areas, (ii) maintain all such workers' compensation or similar insurance or
self-insurance as may be required by law, and (iii) maintain, in amounts and
with deductibles or retentions equal to those generally maintained by businesses
engaged in similar activities in similar geographic areas, general public
liability insurance against claims for bodily injury, death or property damage
occurring on, in or about the properties of the Borrower or its Subsidiaries,
business interruption insurance and product liability insurance. The Borrower
will, and will cause any applicable Subsidiary to, maintain insurance on the
Mortgaged Property in accordance with the terms of the Mortgage.
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(b) The proceeds of any casualty insurance in respect of any casualty
loss of any of the Collateral shall, subject to the rights, if any, of other
parties with a prior interest in the property covered thereby, (i) so long as no
Default or Event of Default has occurred and is continuing and to the extent
that the amount of such proceeds is less than $1,000,000, be disbursed to the
Borrower for direct application by the Borrower solely to the repair or
replacement of the Borrower's property so damaged or destroyed or for the
purchase of other similar properties and (ii) in all other circumstances, be
held by the Administrative Agent as cash collateral for the Obligations,
PROVIDED, that if such insurance is in respect of any casualty loss of any
Collateral consisting of the Canton Cast-Roll Facility, such proceeds shall be
applied or reinvested in the manner provided in Section 3.2(b)(ii). The
Administrative Agent may, at its sole option, disburse from time to time all or
any part of such proceeds so held as cash collateral, upon such terms and
conditions as the Administrative Agent may reasonably prescribe, for direct
application by the Borrower solely to the repair or replacement of the
Borrower's property so damaged or destroyed or for the purchase of other similar
properties, or the Administrative Agent may apply all or any part of such
proceeds to the Obligations, PROVIDED, that if such proceeds are in respect of
any casualty loss of any Collateral consisting of the Canton Cast-Roll Facility,
such proceeds shall be applied or reinvested in the manner provided in Section
3.2(b)(ii).
(c) All policies of insurance shall provide for thirty (30) days prior
written minimum cancellation notice to the Administrative Agent. In the event of
failure to provide and maintain insurance as herein provided, the Administrative
Agent may, at its option, after giving notice to the Borrower provide such
insurance and charge the amount thereof to the Borrower. The Borrower shall
furnish to the Administrative Agent certificates or other evidence satisfactory
to the Administrative Agent of compliance with the foregoing insurance
provision.
8.8. TAXES, ETC. The Borrower will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all material taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by law
become a lien or charge upon any of its property; PROVIDED that any such tax,
assessment, charge, levy or claim need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if the Borrower or such Subsidiary shall have established on its books
adequate reserves with respect thereto; and PROVIDED FURTHER that the Borrower
and each Subsidiary of the Borrower will pay all such taxes, assessments,
charges, levies or claims forthwith upon the commencement of proceedings to
foreclose any lien that may have attached as security therefor unless the
Borrower has obtained a stay of such proceedings which remains in effect.
8.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
8.9.1. GENERAL. The Borrower shall permit the Lenders, through
the Administrative Agent or any of the Lenders' other designated
representatives, to visit and inspect any of the properties of the
Borrower or any of its Subsidiaries, to examine the books of account of
the Borrower and its Subsidiaries (and to make copies thereof and
extracts therefrom), and to discuss the affairs, finances and accounts
of the Borrower
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and its Subsidiaries with, and to be advised as to the same by, its and
their officers, all at such reasonable times and intervals as the
Administrative Agent or any Lender may reasonably request. The
Administrative Agent and the Lenders will, to the extent practicable,
exercise their rights under this Section 8.9.1 in a manner which causes
no material disruption of the Borrower's operations. Each of the
Administrative Agent and the Lenders agrees that it will treat in
confidence all financial information with respect to the Borrower and
its Subsidiaries, and all information obtained during such inspection
which is designated by the Borrower as confidential and will not,
without the consent of the Borrower, disclose such information to any
third party and, if any representative or agent of the Administrative
Agent or the Lender shall not be an employee of the Administrative
Agent or such Lender or any affiliate of the Administrative Agent or
such Lender, such designee shall be reputable and of recognized
standing and shall agree in writing to treat in confidence the
information obtained during any such inspection and, without the prior
written consent of the Borrower, not to disclose such information to
any third party or make use of such information for personal gain.
Notwithstanding the foregoing, the Borrower hereby authorizes the
Administrative Agent and each Lender to disclose information obtained
pursuant to this Credit Agreement to other banks or financial
institutions who are participants in the Revolving Credit Loans and
Letters of Credit made or issued or to be made or issued hereunder and
to potential participants with the consent of the Borrower, such
consent not to be unreasonably withheld; PROVIDED that such participant
or potential participant agrees to be bound by the confidentiality
provisions of this Section 8.9.1, and where required or requested by
governmental or regulatory authorities.
8.9.2. COMMERCIAL FINANCE EXAMINATIONS. The Borrower will
permit the Administrative Agent's examiners and, if accompanied by the
Administrative Agent or its examiners, a Lender's examiners, from time
to time, to conduct, at the Borrower's reasonable expense, commercial
finance examinations of the Borrower and its Subsidiaries.
8.9.3. COMMUNICATIONS WITH ACCOUNTANTS. The Borrower authorizes
the Administrative Agent and, if accompanied by the Administrative
Agent, the Lenders to communicate with the Borrower's independent
certified public accountants and financial advisors and, in the case of
the accountants, authorizes such accountants to disclose to the
Administrative Agent and the Lenders any and all financial statements
and other supporting financial documents and schedules including copies
of any management letter with respect to the business, financial
condition and other affairs of the Borrower or any of its Subsidiaries.
At the request of the Administrative Agent, the Borrower shall deliver a
letter addressed to such accountants instructing them to comply with the
provisions of this Section 8.9.3.
8.9.4. ENVIRONMENTAL ASSESSMENTS. Whether or not an Event of
Default shall have occurred and be continuing, the Administrative Agent
may, from time to time, in its reasonable discretion for the purpose of
assessing and ensuring the value of the Mortgaged Property, obtain one
or more environmental assessments or audits of reasonable scope and
expense of the Mortgaged Property prepared by a hydrogeologist, an
independent engineer or other qualified consultant or expert retained by
the
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Administrative Agent to evaluate or confirm (i) whether any Hazardous
Substances are present in the soil or water at the Mortgaged Property
and (ii) whether the use and operation of such Mortgaged Property
materially complies with all Environmental Laws. Environmental
assessments may include without limitation detailed visual inspections
of the Mortgaged Property including any and all storage areas, storage
tanks, drains, dry xxxxx and leaching areas, and the taking of soil
samples, surface water samples and ground water samples, as well as
such other investigations or analyses as the Administrative Agent
reasonably deems appropriate. All such environmental assessments shall
be conducted and made at the expense of the Borrower.
8.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause each of its Subsidiaries to, comply with (a) the
applicable laws and regulations wherever its business is conducted, including
all Environmental Laws, except where failure to do so will not have a Material
Adverse Effect, (b) the provisions of its charter documents and by-laws, and all
agreements and instruments by which it or any of its properties may be bound,
except where failure to do so will not have a Material Adverse Effect, and (c)
all applicable decrees, orders, and judgments, except where failure to do so
will not have a Material Adverse Effect. If any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of any
government shall become necessary or required in order that the Borrower may
fulfill any of its obligations hereunder or any of the other Loan Documents, the
Borrower will promptly take or cause to be taken all reasonable steps within the
power of the Borrower to obtain such authorization, consent, approval, permit or
license and furnish the Administrative Agent and the Lenders with evidence
thereof.
8.11. EMPLOYEE BENEFIT PLANS. The Borrower will (a) promptly upon
request of the Administrative Agent, furnish to the Administrative Agent a copy
of the most recent actuarial statement required to be submitted under Section
103(d) of ERISA and Annual Report, Form 5500, with all required attachments, in
respect of each Guaranteed Pension Plan with unfunded benefit liabilities in
excess of $500,000 and (b) promptly upon receipt or dispatch, furnish to the
Administrative Agent any notice, report or demand sent or received in respect of
a Guaranteed Pension Plan with unfunded benefit liabilities in excess of
$500,000 under Section Section 302, 4041, 4042, 4043, 4063, 4066 and 4068 of
ERISA, or in respect of a Multiemployer Plan, under Section Section 4041A, 4202,
4219, 4242, or 4245 of ERISA.
8.12. USE OF PROCEEDS. The Borrower will use the proceeds of the
Revolving Credit Loans, and will obtain Letters of Credit, solely for the
purposes set forth in Section 7.15.
8.13. BANK ACCOUNTS; AGENCY ACCOUNT ARRANGEMENTS.
8.13.1 BANK ACCOUNTS. The Borrower shall, and shall cause each
of its Subsidiaries to, require all account debtors to make payments to
the Swept Lockboxes or Swept Accounts; PROVIDED, HOWEVER, that account
debtors of Canadian Drawn Steel Company Inc. ("CANADIAN DRAWN") may
make payments to a Blocked Account that is not a Swept Account (any
such Blocked Account to which account debtors of Canadian Drawn may
make payments referred to herein as a "CANADIAN BLOCKED ACCOUNT") or a
lockbox that is not a Swept Lockbox (any such lockbox to which account
debtors of Canadian Drawn may make payments referred to herein as a
"CANADIAN LOCKBOX"), PROVIDED, FURTHER, that (a) no Blocked Account may
be deemed a Canadian Blocked
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Account and no account debtors of Canadian Drawn may make payments to
such Blocked Account unless the Administrative Agent shall have given
its consent thereto with respect to such Blocked Account and (b) no
lockbox may be deemed a Canadian Lockbox and no account debtors of
Canadian Drawn may make payments to such lockbox unless the
Administrative Agent shall have given its consent thereto with respect
to such lockbox. The Borrower shall maintain lockbox agreements, in
form and substance reasonably satisfactory to the Administrative Agent,
with the Blocked Account Banks which maintain Swept Lockboxes, pursuant
to which lockbox agreements all checks, drafts or other items or
amounts in such Swept Lockboxes shall be deposited by such Blocked
Account Bank in the Swept Accounts maintained by such Blocked Account
Bank. The Borrower shall maintain lockbox agreements, in form and
substance reasonably satisfactory to the Administrative Agent, with the
Blocked Account Banks which maintain Canadian Lockboxes, pursuant to
which lockbox agreements all checks, drafts or other items or amounts
in such Canadian Lockboxes shall be deposited by such Blocked Account
Bank in the Canadian Blocked Accounts maintained by such Blocked
Account Bank. The Borrower shall, and shall cause each of its
Subsidiaries to, together with the employees, agents and other Persons
acting on behalf of the Borrower or any such Subsidiary, receive and
hold in trust for the Administrative Agent and the Lenders all payments
constituting proceeds of Accounts Receivable or other Collateral which,
notwithstanding the foregoing, come into their possession or under
their control and, immediately upon receipt thereof, deposit such
payments in the form received, with any appropriate endorsements, in
one of the Swept Accounts or, if such payments are from account debtors
of Canadian Drawn, one of the Canadian Accounts.
8.13.2. AGENCY ACCOUNT ARRANGEMENTS.
(a) If the Borrower or any of its Subsidiaries opens any
Blocked Account after the Effective Date, the Borrower will, and will
cause its Subsidiaries to, execute and deliver to the Administrative
Agent for the benefit of the Administrative Agent and the Lenders, an
Agency Agreement executed by the Borrower and its Subsidiaries and the
Blocked Account Bank with which the Borrower or its Subsidiaries opens
such Blocked Account simultaneously with the opening of such Blocked
Account. The Administrative Agent shall be granted a security interest
by the Borrower and each of its Subsidiaries in all Blocked Accounts.
No Agency Agreement may be modified or amended without the prior
written consent of the Administrative Agent.
(b) The Borrower expressly agrees that (i) following notice to
the Blocked Account Banks of the existence and continuance of a Default
or an Event of Default the Administrative Agent may at anytime require
that, from and after the date specified in such notice, all monies
deposited in the Blocked Accounts be transferred on a daily basis to
the Concentration Account, which monies shall be credited against
Obligations (or such monies shall be applied directly to pay down the
Obligations without such monies being transferred first to such the
Concentration Account) and (ii) in the event such transfer is required,
upon the request of the Administrative Agent, the Borrower will take
any steps necessary, to effect such transfer, including, without
limitation, the execution and delivery of amendments to each of the
Agency Agreements. From time to
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time, upon the Administrative Agent's reasonable request, the Borrower
shall furnish to the Administrative Agent copies of all bank statements
and other notices received by it with respect to the Blocked Accounts.
(c) The Borrower agrees that all monies deposited in the Swept
Accounts shall be transferred to the Administrative Agent on a daily
basis and applied on a daily basis to the Obligations as provided in
Section 3.4.1, and the Borrower shall take any steps reasonably deemed
by the Administrative Agent to be necessary or advisable to effect such
application, including, without limitation, the execution and delivery
of lockbox agreements and amendments to each of the Agency Agreements.
The Borrower further agrees that the Xxxxx Cash Accounts shall contain,
considered together and in the aggregate, no more than $60,000.
8.14. BORROWING BASE. The Borrower represents, warrants and covenants
as follows:
(a) At the time any Eligible Account Receivable is included in the
Borrowing Base and to the extent of the value of such Eligible Account
Receivable as reflected in the Borrowing Base, such Eligible Account Receivable
shall conform to the definition of Eligible Account Receivable.
(b) The Borrower is, and as to Eligible Inventory to be acquired after
the date hereof and to be included in the Borrowing Base, shall be the owner of
all Eligible Inventory to be included in the Borrowing Base and (except for the
liens for carrier, warehouse, customs and similar statutory liens arising in the
ordinary course of business) shall neither create nor suffer to exist any lien
or encumbrance thereon or security interest therein in favor of any Person other
than the Administrative Agent.
(c) The Borrower is the owner of the Canton Cast-Roll Facility and
shall neither create nor suffer to exist any lien or encumbrance thereon or
security interest therein in favor of any Person other than the Administrative
Agent (other than liens permitted by the Mortgage).
(d) The Borrower shall give the Administrative Agent on the Effective
Date a list of, and thereafter shall give thirty (30) days written notice prior
to any change in, each warehouse location at which inventory is or will be kept
and each office of the Borrower at which the records of the Borrower pertaining
to Accounts Receivable and contract rights are kept. All Eligible Inventory is
and shall be kept, and all records pertaining to Accounts Receivable and
contract rights are and shall be kept, only at locations of which the
Administrative Agent has been given notice as provided in this Section 8.14(d).
(e) The Borrower shall promptly notify the Administrative Agent of any
of the following events of which any senior or executive officer of the Borrower
becomes aware: any material loss or depreciation in value of Eligible Inventory
or the Canton Cast-Roll Facility and the amount of the loss or depreciation;
rejection, return, repossession or loss of any material amount of goods giving
rise to Eligible Accounts Receivable; material damage to any such goods; any
request by an account debtor for any credits or adjustments of Eligible Accounts
Receivable which are material in the aggregate; any adjustments of the amounts
owing on Eligible Accounts Receivable which are material in the aggregate; any
other disputes which are material in the aggregate; any other event which
materially affects Eligible Inventory, Eligible
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Fixed Assets or Eligible Accounts Receivable or the value or amount thereof,
PROVIDED, that during any period when Eligible Accounts Receivable are being
determined on a daily basis, all applicable adjustments to the amount thereof
shall be taken on the day such adjustment(s) are made, and shall not be delayed
by virtue of this Section 8.14(e). For purposes of this Section 8.14(e),
"material" shall mean involving amounts in excess of $500,000.
8.15. FURTHER ASSURANCES. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Lenders and the Administrative Agent and
execute such further instruments and documents as the Lenders or the
Administrative Agent shall reasonably request to carry out to their satisfaction
the transactions contemplated by this Credit Agreement and the other Loan
Documents.
8.16. RETENTION OF FINANCIAL ADVISOR. The Borrower and the Guarantors
agree that the Administrative Agent and/or its counsel may retain a financial
advisor acceptable to the Administrative Agent and the Lenders to, among other
things, make visits to, and discuss financial and operational matters with, the
Borrower and its Subsidiaries and to advise the Agents and the Lenders as to the
business, operations and financial condition of the Borrower and its
Subsidiaries. Such consultant shall not be limited in the frequency of visits to
the facilities of the Borrower and its Subsidiaries. The Borrower shall, and
shall cause each of its Subsidiaries to, cooperate with such consultant and
provide such consultant with all information reasonably requested by such
financial advisor in connection with its engagement by the Administrative Agent
and/or its counsel.
8.17. COLLATERAL PRESERVATION. The Borrower shall, and shall cause each
of its Subsidiaries to, take all such further actions as the Agents may from
time to time reasonably request to preserve, protect, perfect and ensure the
priority of any Collateral subject to Permitted Liens entitled to priority under
applicable law.
8.18. ENGAGEMENT OF ADVISOR(S). The Administrative Agent and/or its
counsel shall be entitled at any time to retain an advisor or advisors to assist
the Administrative Agent and the Lenders in, among other things, exercising
their rights and remedies following an Event of Default. The Borrower shall, and
shall cause each of its Subsidiaries to, cooperate with such advisor(s) and
provide such advisor(s) with such information, documentation, and access to
employees as may be reasonably requested by such advisor(s). The Administrative
Agent shall notify the Borrower of any such retention.
8.19. SECURITY DOCUMENTATION. To the extent not delivered on the
Effective Date, the Borrower will, and will cause each of its Subsidiaries to
deliver to the Administrative Agent all such documents and instruments and take
all such actions as may reasonably be requested by the Administrative Agent in
order to fully perfect the Administrative Agent's first priority perfected
security interest in the Collateral including, without limitation, financing
statements, mortgages, legal opinions, and corporate authority documentation
relating thereto.
Section 9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER. The Borrower
covenants and agrees that, so long as any Revolving Credit Loan, Letter of
Credit or Revolving Credit Note is outstanding or any Lender has any obligation
to make any Revolving Credit Loans or the Issuing Bank has any obligations to
issue, extend or renew any Letters of Credit:
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9.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness or
Rental Obligations other than:
(a) Indebtedness to the Lenders and the Administrative Agent arising
under any of the Loan Documents;
(b) Indebtedness in existence on the Effective Date and current
liabilities of the Borrower or such Subsidiary, in each case incurred in the
ordinary course of business not incurred through (i) the borrowing of money, or
(ii) the obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal purchases of
goods and services;
(c) Indebtedness of the Borrower and its Subsidiaries in respect of
taxes, assessments, governmental charges or levies and claims for labor,
materials and supplies to the extent that payment therefor shall not at the time
be required to be made in accordance with the provisions of Section 8.8;
(d) Indebtedness of the Borrower and its Subsidiaries in respect of
judgments or awards that have been in force for less than the applicable period
for taking and pursuing an appeal so long as execution is not levied thereunder
or in respect of which the Borrower or such Subsidiary shall at the time in good
faith be prosecuting an appeal or proceedings for review and in respect of which
a stay of execution shall have been obtained pending such appeal or review;
(e) endorsements for collection, deposit or negotiation and warranties
of products or services, in each case incurred in the ordinary course of
business;
(f) Indebtedness of the Borrower and its Subsidiaries consisting of
Rental Obligations under operating leases with aggregate payments due in any
year not in excess of $5,000,000;
(g) Indebtedness consisting of contingent liabilities in respect of
litigation against the Borrower so long as such Indebtedness would not be
required by the Borrower's independent public accountants to be included in the
footnotes to the financial statements delivered pursuant to Section 8.4(a) or
the reserves for which required to be established on the books of the Borrower
are not in excess of $10,000,000;
(h) Indebtedness of the Borrower and its Subsidiaries incurred in
connection with the Capitalized Lease or acquisition after the date hereof of
personal or tangible property by the Borrower or any Subsidiary or the
refinancing thereof; PROVIDED that the principal amount of such Indebtedness
shall not exceed in any case 90% of the cost, to the Borrower or such
Subsidiary, of the personal or tangible property so acquired, and PROVIDED,
FURTHER, that the aggregate principal amount of such Indebtedness outstanding
shall not exceed $15,000,000 at any time;
(i) Indebtedness in respect of the Notes not exceeding the aggregate
principal amount of $425,000,000;
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(j) Indebtedness existing on the date hereof and listed and described
on SCHEDULE 9.1 hereto, and Indebtedness incurred pursuant to the refinancing of
such Indebtedness provided that such Indebtedness (i) is in an aggregate
principal amount no greater than that portion of the Indebtedness listed on
SCHEDULE 9.1 hereto so refinanced, (ii) has a final scheduled maturity later
than the final scheduled maturity of the Indebtedness refinanced, (iii) shall
not be secured by any lien or any assets that did not secure the Indebtedness
refinanced, (iv) shall be otherwise subject to terms and conditions reasonably
satisfactory to the Agents;
(k) Indebtedness of a Subsidiary Guarantor of the Borrower to the
Borrower or another Subsidiary Guarantor and of the Borrower to a Subsidiary
Guarantor;
(l) Indebtedness with respect to surety bonds and other obligations of
the type described in Section 9.2(x) required in the ordinary course of business
of the Borrower and its Subsidiaries, PROVIDED that the aggregate principal
amount of such Indebtedness shall not at any time exceed $5,000,000;
(m) Indebtedness of the Borrower and its Subsidiaries consisting of
contingent liabilities with respect to Guaranteed Pension Plans to the extent
permitted under Section 9.9;
(n) Indebtedness incurred under any interest rate swap, cap, collar or
similar arrangements or foreign currency exchange transactions with respect to
Indebtedness permitted by this Credit Agreement;
(o) Indebtedness of the Borrower or any of its Subsidiaries consisting
of obligations of the Borrower or any of its Subsidiaries in respect of workers'
compensation, health, disability or other employee benefits, social security
payments, property, casualty or liability insurance premiums or other payment
obligations in connection with self-insurance or similar requirements in the
ordinary course of business;
(p) Indebtedness consisting of Junior Subordinated Indebtedness in the
aggregate principal amount not to exceed $30,000,000, plus accrued interest
thereon.
9.2. RESTRICTIONS ON LIENS. The Borrower will not, and will not permit
any of its Subsidiaries to, (a) create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (b) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (c) acquire any property or assets upon
conditional sale or other title retention or purchase money security agreement,
device or arrangement; (d) suffer to exist for a period of more than thirty (30)
days after the same shall have been incurred any Indebtedness or claim or demand
against it that if unpaid would by law or upon bankruptcy or insolvency, or
otherwise, be given any priority whatsoever over its general creditors; or (e)
sell, assign, pledge or otherwise transfer any accounts, contract rights,
general intangibles (other than general intangibles related to assets disposed
of in accordance with this Agreement and the other Loan Documents), chattel
paper
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or instruments, with or without recourse; PROVIDED that the Borrower and any
Subsidiary of the Borrower may create or incur or suffer to be created or
incurred or to exist:
(i) liens in favor of the Borrower on all or part of the
assets of Subsidiaries of the Borrower securing Indebtedness owing by
Subsidiaries of the Borrower to the Borrower;
(ii) liens on assets of the Borrower or its Subsidiaries to
secure taxes, assessments and other government charges in respect of
obligations not overdue or liens on properties other than the Mortgaged
Property of the Borrower or its Subsidiaries to secure claims for
labor, material or supplies in respect of obligations not overdue (or,
in each case, which are being contested in good faith and by
appropriate proceedings and as to which adequate reserves have been
provided);
(iii) deposits or pledges made by the Borrower or its
Subsidiaries in connection with, or to secure payment of, workmen's
compensation, unemployment insurance, old age pensions or other social
security obligations or in connection with self-insurance arrangements
in respect of such obligations;
(iv) liens on properties of the Borrower or its Subsidiaries
in respect of judgments or awards, the Indebtedness with respect to
which is permitted by Section 9.1(d);
(v) liens of carriers, warehousemen, mechanics, repairmen,
laborers, suppliers and materialmen on properties of the Borrower or
its Subsidiaries other than the Mortgaged Property in existence less
than 120 days from the date of creation thereof in respect of
obligations not overdue;
(vi) encumbrances on Real Estate other than the Mortgaged
Property of the Borrower or its Subsidiaries consisting of easements,
rights of way, zoning restrictions, restrictions on the use of real
property and defects and irregularities in the title thereto,
landlord's or lessor's liens under leases to which the Borrower or a
Subsidiary of the Borrower is a party, and other minor liens or
encumbrances none of which in the opinion of the Borrower interferes
materially with the use of the property affected in the ordinary
conduct of the business of the Borrower and its Subsidiaries, which
defects do not individually or in the aggregate have a materially
adverse effect on the business of the Borrower individually or of the
Borrower and its Subsidiaries on a consolidated basis;
(vii) liens of the Borrower and its Subsidiaries existing on
the date hereof and listed on SCHEDULE 9.2 hereto and refinancings of
such Indebtedness permitted under Section 9.1(j);
(viii) Capitalized Leases secured by, and purchase money
security interests in, personal or tangible property of the Borrower or
its Subsidiaries acquired or refinanced after the date hereof to secure
purchase money Indebtedness of the type and amount permitted by Section
9.1(j), incurred in connection with the acquisition of such property,
which security interests cover only the personal or tangible property
so acquired;
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(ix) liens in favor of the holders of the Notes, which liens
shall in no event include any lien or encumbrance of any kind on the
Collateral except for such portion of the Collateral which is pledged
pursuant to the Master Pledge Agreement;
(x) liens securing the performance of tenders, bids, contracts
(other than for Indebtedness), leases (other than Capitalized Lease
Obligations), statutory obligations, surety and appeal bonds,
performance bonds and other obligations of like nature to the extent
permitted by Section 9.1(l) on assets of the Borrower and Subsidiary
Guarantors not constituting Collateral;
(xi) liens in favor of the Administrative Agent for the
benefit of the Lenders and the Administrative Agent under the Loan
Documents;
(xii) liens and encumbrances on the Mortgaged Property as and
to the extent permitted by the Mortgage;
(xiii) liens on assets of the Borrower or any Subsidiary
Guarantor not constituting Collateral which assets secure the
Borrower's obligations in respect of the Notes to the extent that such
liens are permitted under the Indenture;
(xiv) any leases or subleases to other Persons of properties
or assets owned or leased by the Borrower or any of its Subsidiaries;
(xv) liens on cash deposits, not exceeding $3,000,000 in the
aggregate, to secure the Borrower's and Subsidiary Guarantors'
obligations in respect of insurance and items of the type referred to
in clause (iii) or (x) above; and
(xvi) liens on the Canton Cast-Roll Facility securing the
Junior Subordinated Indebtedness subordinate to the liens of the
Lenders and the Administrative Agent thereon pursuant to the
Subordinated Mortgage and otherwise on terms and conditions
satisfactory to the Agents.
9.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except:
(a) Investments by the Borrower or its Subsidiaries in marketable
direct or guaranteed obligations of the United States of America that mature
within one (1) year from the date of purchase by the Borrower;
(b) Investments by the Borrower or its Subsidiaries in demand deposits,
certificates of deposit, Eurodollar deposits, bankers acceptances and time
deposits of United States banks having total assets in excess of $1,000,000,000,
or foreign subsidiaries of such banks;
(c) Investments by the Borrower or its Subsidiaries in securities
commonly known as "commercial paper" issued by a corporation organized and
existing under the laws of the United States of America or any state thereof
that at the time of purchase have been rated and the ratings for which are not
less than "P 1" if rated by Xxxxx'x Investors Services, Inc., and not less than
"A 1" if rated by Standard and Poor's Ratings Group or, so long as no
Obligations are
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outstanding, not less than "P 2" if rated by Xxxxx'x Investors Services, Inc.,
and not less than "A 2" if rated by Standard and Poor's Ratings Group;
(d) Investments by the Borrower or its Subsidiaries in debt of any
state or political subdivision that is rated "A" or better and due within one
(1) year from the date of purchase by the Borrower or its Subsidiaries;
(e) Investments by the Borrower or its Subsidiaries in repurchase
agreements secured by any one or more of the foregoing;
(f) Investments existing on the date hereof and listed on SCHEDULE 9.3
hereto;
(g) Investments with respect to Indebtedness permitted by Section
9.1(k) so long as such entities remain Subsidiaries of the Borrower and
Guarantors hereunder;
(h) Investments consisting of non-cash consideration received as
proceeds of asset dispositions permitted by Section 9.6;
(i) Investments by the Borrower or its Subsidiaries in shares of any
so-called "money market fund", PROVIDED that such fund is registered under the
Investment Company Act of 1940, has net assets of at least $500,000,000 and has
an investment portfolio with an average maturity of 365 days or less;
(j) Investments by the Borrower or its Subsidiaries in securities of
any Person acquired in full or partial satisfaction of liabilities of said
Person to the Borrower, in a workout or a bankruptcy or insolvency proceeding
with respect to such Person;
(k) Investments by the Borrower or its Subsidiaries in interest rate
swaps, caps, collars or similar arrangements or foreign currency exchange
transactions entered into in connection with respect to Indebtedness permitted
under this Agreement or commodities xxxxxx;
(l) Investments permitted by Section 9.5;
(m) Investments consisting of deposits provided to third parties with
respect to leases or utilities in the ordinary course of business;
(n) Investments by the Borrower or its Subsidiaries in advances to
officers or employees for travel or other expenses incurred in the ordinary
course of conducting company business not in excess of $250,000 at any time; and
(o) Investments by the Borrower or its Subsidiaries consisting of
purchases and acquisitions of inventory, supplies, materials and equipment or
licenses or leases of intellectual property otherwise not prohibited hereunder.
PROVIDED, HOWEVER, that, if an Event of Default shall have occurred and
be continuing, upon request by the Administrative Agent, with respect to all
Investments other than demand deposits referred to in Section 9.3(b),
Investments other than short term Investments listed on SCHEDULE
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9.3 hereto or described in clause (h) above and Investments of the type
described in clauses (g) and (j) through (t), either (p) such Investments shall
be immediately converted into cash and deposited in a Blocked Account or (ii)
all actions with respect to such Investments shall be taken to the satisfaction
of the Administrative Agent to provide to the Administrative Agent, for the
benefit of the Lenders and the Administrative Agent, a first-priority perfected
security interest in such Investments free of all encumbrances other than
Permitted Liens.
9.4. CHANGE IN TERMS OF CAPITAL STOCK; DISTRIBUTIONS AND OTHER
RESTRICTED PAYMENTS. The Borrower shall not, and shall not permit any Subsidiary
to, effect or permit any change in or amendment to any document or instrument
pertaining to the terms of the Borrower's or such Subsidiary's capital stock
which would be adverse to the interests of the Lenders. The Borrower will not,
and will not permit any of its Subsidiaries to, make any Restricted Payments
except:
(a) Distributions by Subsidiaries of the Borrower to the Borrower
without limitation;
(b) noncash repurchases of capital stock or other equity interests
deemed to occur upon exercise of stock options if such capital stock represents
a portion of the exercise price of such options; and
(c) Restricted Payments consisting of (i) the sale, purchase or
provision of goods and services from Affiliates in the ordinary conduct of the
Borrower's and Subsidiary Guarantors' business and (ii) transactions permitted
under Section 9.14, in each case on arms length terms and which are not
otherwise expressly provided for and restricted in this Section 9.4.
9.5. MERGER AND CONSOLIDATION. Except pursuant to the Reorganization
Plan, the Borrower will not, and will not permit any of its Subsidiaries to,
become a party to any merger or consolidation, or agree to or effect any asset
acquisition or stock acquisition (other than the acquisition of assets in the
ordinary course of business consistent with past practices) except the merger or
consolidation of one or more of the Subsidiaries of the Borrower with and into
the Borrower, or the merger or consolidation of two or more Subsidiaries of the
Borrower.
9.6. SALE AND LEASEBACK; DISPOSITION OF ASSETS. The Borrower will not,
and will not permit any of its Subsidiaries to, enter into any arrangement,
directly or indirectly, whereby the Borrower or any Subsidiary of the Borrower
shall sell, transfer, lease or otherwise dispose of any assets or property owned
by it or hereafter acquired by it in one transaction or a series of
transactions, including, without limitation, in order then or thereafter to
lease such property or lease other property that the Borrower or any Subsidiary
of the Borrower intends to use for substantially the same purpose as the
property being sold or transferred other than (a) the disposition of assets
(obsolete or otherwise) in the ordinary course of business, (b) so long as no
Event of Default shall have occurred and be continuing, (i) the disposition of
Investments permitted by Section 9.3; (ii) the disposition of assets listed on
SCHEDULE 9.6 hereto; (iii) the disposition of additional assets on an arms
length basis having an aggregate fair market value (after deducting from such
aggregate value the cash proceeds of previous asset sales which are reinvested,
within 180 days after sale, with such deduction being treated as having been
made in the fiscal year of such reinvestment) of no more than 10% of the
Borrower's total consolidated assets as reflected on the Borrower's pro forma
balance sheet as at the Effective Date, PROVIDED
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that assets having a fair market value of no more than 5% of the Borrower's
total consolidated assets as reflected on the Borrower's pro forma balance sheet
as at the Effective Date shall be disposed in any fiscal year of the Borrower
pursuant to this clause (iii); and (iv) the sale of the Closed Facilities on an
arms-length basis for consideration consisting of at least 75% cash or other
consideration acceptable to the Agents. All Net Cash Proceeds of any disposition
of assets shall be deposited immediately into a Blocked Account, PROVIDED
HOWEVER, that such Net Cash Proceeds shall subject such other provisions of
Section 3.2(b) as may be applicable.
9.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. Except for actions which are
in material compliance with Environmental Laws or would not result in a Material
Adverse Effect, the Borrower will not, and will not permit any of its
Subsidiaries to, (a) use any of the Real Estate or any portion thereof for the
handling, processing, storage or disposal of Hazardous Substances, (b) cause or
permit to be located on any of the Real Estate any underground tank or other
underground storage receptacle for Hazardous Substances, (c) generate any
Hazardous Substances on any of the Real Estate, (d) conduct any activity at any
Real Estate or use any Real Estate in any manner so as to cause a release (i.e.
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, disposing or dumping) or threatened release of
Hazardous Substances on, upon or into the Real Estate or (e) otherwise conduct
any activity at any Real Estate or use any Real Estate in any manner that would
cause a violation of Environmental Laws the result of which violation would have
a Material Adverse Effect.
9.8. INDEBTEDNESS IN RESPECT OF THE NOTES. The Borrower shall not
amend, supplement or otherwise modify the terms of the Indebtedness in respect
of the Notes or any of the Note Documents to increase the interest rate on, or
principal amount or any premium thereof, shorten the average maturity thereof,
or permit or require the granting or pledging of collateral in addition to the
collateral granted or pledged under the Note Documents as of the date hereof or
required on the date hereof to be granted or pledged, or make any provisions
thereof more restrictive on the Borrower or the Parent than they are on the date
hereof, or otherwise if, in the reasonable opinion of the Lenders, such
amendment, supplement or modification could be adverse to the interests of the
Lenders. The Borrower shall not prepay, redeem or repurchase any of the
Indebtedness in respect of the Notes or give notice in respect of such
prepayment, redemption or repurchase other than as required under the Note
Documents as of the date hereof and as permitted by Section 3.2(b).
9.9. EMPLOYEE BENEFIT PLANS. Unless a Material Adverse Effect is not
reasonably likely to result, neither the Borrower nor any ERISA Affiliate will:
(a) engage in any non-exempt "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975 of the Code which is reasonably
likely to result in a liability for the Borrower or any of its Subsidiaries; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated funding
deficiency", as such term is defined in Section 302 of ERISA, whether or not
such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could result
in the imposition of a
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lien or encumbrance on the assets of the Borrower or any of its Subsidiaries
pursuant to Section 302(f) or Section 4068 of ERISA;
(d) amend any Guaranteed Pension Plan in circumstances requiring the
posting of security pursuant to Section 307 of ERISA or Section 401(a)(29) of
the Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (within the meaning of Section 4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of such
Plans, disregarding for this purpose the benefit liabilities and assets of any
such Plan with assets in excess of benefit liabilities, by more than the amount
set forth in Section 7.14.3.
9.10. BANK ACCOUNTS. The Borrower will not, and will not permit any of
its Subsidiaries to, (a) establish any bank accounts other than those listed on
SCHEDULE 7.18 without the Administrative Agent's prior written consent, which
consent shall not be unreasonably withheld, (b) violate directly or indirectly
any bank agency agreement in favor of the Administrative Agent for the benefit
of the Lenders and the Administrative Agent with respect to such account, or (c)
deposit into any of the payroll accounts listed on SCHEDULE 7.18 any amounts in
excess of amounts necessary to pay current payroll obligations from such
accounts based on the Borrower's reasonable estimates of such amounts.
9.11. LIMITATION ON ISSUANCE OF SHARES OF SUBSIDIARIES; DISPOSITION OF
SHARES AND INDEBTEDNESS OF SUBSIDIARIES.
(a) Except pursuant to the Reorganization Plan and as permitted by
Section Section 9.4, 9.5 or 9.6, the Borrower will not permit any of its
Subsidiaries to issue, sell or otherwise dispose of any shares of such
Subsidiary or any securities convertible into or exchangeable for or carrying
rights to subscribe for shares of such Subsidiary, except (i) to the Borrower,
or (ii) for the purpose of qualifying directors. The Borrower will not, in any
event, permit any Subsidiary to have outstanding any preferred shares, other
than preferred shares owned by the Borrower.
(b) Except pursuant to the Reorganization Plan and as permitted by
Section Section 9.4, 9.5 or 9.6, the Borrower will not sell, transfer or
otherwise dispose of any shares (except for the purpose of qualifying directors)
or any Indebtedness of any Subsidiary.
9.12. NO MATERIAL CHANGES, ETC. The Borrower shall not permit, at any
time after the Balance Sheet Date, any fact or circumstance (whether or not the
result thereof would be covered by insurance) as to which singly or in the
aggregate there is a reasonable likelihood of (a) a material adverse change with
respect to the value of the Collateral taken as a whole, or (b) the inability of
the Lenders or the Administrative Agent to enforce in any material respect their
rights to be granted hereunder or under any of the other Loan Documents or the
Obligations (including realizing on the Collateral).
9.13. NO SUBSIDIARIES. The Borrower will not, and will not permit any
of its Subsidiaries to, create or form, by acquisition or otherwise, any
Subsidiary in addition to the Subsidiaries of the Borrower described in Section
7.17 unless such new Subsidiary shall have become a Guarantor, shall have
pledged its assets of the type pledged by the Borrower and the Guarantors as of
the Effective Date and shall have provided such other documentation as the
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Administrative Agent may reasonably request, including, without limitation,
amendments to the Security Agreements, UCC searches and filings, legal opinions
and corporate authorization documentation, and, if the Eligible Fixed Asset Cap
is not $0, 100% of the equity interests of such new Subsidiary shall be pledged
for the benefit of the Lenders and the Administrative Agent and the holders of
the Notes, such pledge to be subject to terms and conditions substantially
similar to those contained in the Master Pledge Agreement.
9.14. TRANSACTIONS WITH AFFILIATES. Except as described on SCHEDULE
9.14, the Borrower will not, and will not permit any of its Subsidiaries to,
engage in any transaction with any Affiliate (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
real or personal property to or from, or otherwise requiring payments to or from
any such Affiliate or, to the knowledge of the Borrower, any corporation,
partnership, trust or other entity in which such Affiliate has a substantial
interest or is an officer, director, trustee or partner, on terms more favorable
to such Person than would have been obtainable on an arms-length basis. The
Borrower will not enter into any tax sharing agreement with any Person that is
not the Parent or a Subsidiary of the Borrower. Notwithstanding the foregoing,
no payments may be made with respect to any items set forth on SCHEDULE 9.14
during the existence of an Event of Default. This covenant will not restrict the
Borrower or its Subsidiaries from (a) making Investments permitted under Section
9.3 or Distributions permitted under Section 9.4 and (b) engaging in
transactions among the Borrower and its Subsidiaries and among Subsidiaries of
the Borrower otherwise permitted by this Credit Agreement. This covenant shall
not restrict the Borrower or its Subsidiaries from transactions with customers,
clients, suppliers, purchasers or sellers of goods or services, in each case in
the ordinary course of business and on arms length terms and otherwise in
compliance with this Agreement.
9.15. PARENT. The Parent shall at no time own any material assets other
than the membership interests of the Borrower. The Parent shall at no time
engage in any business other than the ownership, directly or indirectly, of the
membership interests of the Borrower and activities incidental thereto. The
Parent shall not incur any Indebtedness in respect of borrowed money except
under the Loan Documents and its guaranty of the Notes and the Pennsylvania
Indebtedness. The Parent shall not create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon the membership interests
of the Borrower other than under the Master Pledge Agreement.
9.16. BANKRUPTCY CASES. The Borrower will not, and will not permit any
of its Subsidiaries to seek, consent or suffer to exist (i) any modification,
stay, vacation or amendment to the Orders; (ii) a priority claim for any
administrative expense or unsecured claim against the Borrower or any Guarantor
(now existing or hereafter arising of any kind or nature whatsoever, including
without limitation any administrative expense of the kind specified in Section
503(b), 506(c) or 507(b) of the Bankruptcy Code) equal or superior to the
priority claim of the Administrative Agent and the Lenders in respect of the
Obligations other than the Carve Out; and (iii) any Lien on any Collateral,
having a priority equal or superior to the Liens in favor of the Administrative
Agent and the Lenders in respect of the Obligations, except for Permitted Prior
Liens.
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Section 10. FINANCIAL COVENANTS OF THE BORROWER. The Borrower covenants
and agrees that, so long as any Revolving Credit Loan, Letter of Credit or
Revolving Credit Note is outstanding or any Lender has any obligation to make
any Revolving Credit Loans or the Issuing Bank has any obligation to issue,
extend or renew any Letters of Credit:
10.1. MAXIMUM NET CAPITAL EXPENDITURES. The Borrower will not make, or
permit any Subsidiary of the Borrower to make, Net Capital Expenditures during
any of the periods set forth below that exceed, in the aggregate for the
Borrower and its Subsidiaries, the amounts set forth below opposite such
periods:
-------------------------------------------- ------------------------------------
FISCAL YEAR MAXIMUM NET CAPITAL EXPENDITURES
-------------------------------------------- ------------------------------------
2001 $29,000,000
-------------------------------------------- ------------------------------------
2002 $30,200,000
-------------------------------------------- ------------------------------------
10.2. MINIMUM EBITDA. The Borrower will not cause or permit EBITDA for
any Test Period ending during a month set forth below to be less than the amount
set forth below opposite such month:
--------------------------------------------- -------------------------------------------------
FISCAL QUARTER ENDING: MINIMUM TRAILING EBITDA
--------------------------------------------- -------------------------------------------------
June 30, 2001 $14,175,000
--------------------------------------------- -------------------------------------------------
September 30, 2001 $30,750,000
--------------------------------------------- -------------------------------------------------
December 31, 2001 $51,500,000
--------------------------------------------- -------------------------------------------------
March 31, 2002 $77,500,000
--------------------------------------------- -------------------------------------------------
June 30, 2002 $89,500,000
--------------------------------------------- -------------------------------------------------
September 30, 2002 $95,750,000
--------------------------------------------- -------------------------------------------------
10.3. MINIMUM LIQUIDITY. The Borrower will not at any time permit the
sum of (a) (i) Availability LESS (ii) the sum of the outstanding amount of the
Revolving Credit Loans (after giving effect to all amounts requested) and the
Maximum Drawing Amount and all Unpaid Reimbursement Obligations, PLUS (b) the
Net Cash Proceeds from the permitted sale or other disposition of assets
constituting Collateral where such Net Cash Proceeds are deposited in a Swept
Account, PLUS (c) Unrestricted Cash to be less than $2,500,000 at any time.
Section 11. CONCERNING THE EFFECTIVE DATE; CONDITIONS TO EFFECTIVENESS.
The Agents' and the Lenders' obligations to convert their claims against the
Borrower under this Credit Agreement and the obligation of the Lenders to make
the Revolving Credit Loans and of the Issuing Bank to issue, extend or renew any
Letters of Credit provided for in this Credit Agreement shall be subject to
satisfaction of the following conditions precedent on or prior to the Effective
Date:
11.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to each of the
Lenders.
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11.2. CERTIFIED COPIES OF CHARTER DOCUMENTS.
(a) The Administrative Agent shall have received from the Parent, the
Borrower and each of the Subsidiary Guarantors a copy, certified by a duly
authorized officer of such Person to be true and complete on the Effective Date,
of each of (a) its charter or other incorporation or organizational documents as
in effect on such date of certification, and (b) its by-laws or other governing
documents as in effect on such date.
(b) The Administrative Agent shall have received from the Parent, the
Borrower and each of the Subsidiary Guarantors a certificate from the Secretary
of State, or other appropriate authority of the jurisdiction of its
incorporation or organization, evidencing its good standing in such jurisdiction
and in each other jurisdiction in which a failure to so qualify could have a
Material Adverse Effect.
11.3. CORPORATE OR LIMITED LIABILITY COMPANY ACTION. All corporate or
limited liability company action, as applicable, necessary for the valid
execution, delivery and performance by the Parent, the Borrower and each of the
Subsidiary Guarantors of this Credit Agreement and the other Loan Documents to
which such Person is party shall have been duly and effectively taken, and
evidence thereof satisfactory to the Lenders shall have been provided to the
Administrative Agent.
11.4. INCUMBENCY CERTIFICATE. The Administrative Agent shall have
received from the Parent, the Borrower and each of the Subsidiary Guarantors an
incumbency certificate, dated as of the Effective Date, signed by a duly
authorized officer of the Borrower or such Subsidiary, and giving the name and
bearing a specimen signature of each individual who shall be authorized: (a) to
sign, in the name and on behalf of the Parent, the Borrower or such Subsidiary
Guarantor, each of the Loan Documents to which such Person is party; (b) to make
Loan Requests and Conversion Requests and to apply for Letters of Credit; and
(c) to give notices and to take other action on its behalf under the Loan
Documents.
11.5. VALIDITY OF LIENS. The Security Documents shall, upon entry of
the Interim Order or the Final Order, whichever occurs first, be effective to
create in favor of the Administrative Agent a legal, valid and enforceable first
priority (except for Permitted Prior Liens entitled to priority under applicable
law) security interest in and lien upon the Collateral. All filings, recordings,
deliveries of instruments and other actions necessary or desirable in the
opinion of the Administrative Agent to protect and preserve such security
interests shall have been duly effected. The Administrative Agent shall have
received evidence thereof in form and substance satisfactory to the
Administrative Agent.
11.6. UCC SEARCH RESULTS. The Administrative Agent shall have received
from the Parent, the Borrower and each of the Subsidiary Guarantors the results
of UCC searches with respect to the Collateral, indicating no liens other than
Permitted Liens and otherwise in form and substance satisfactory to the
Administrative Agent.
11.7. CERTIFICATES OF INSURANCE. The Administrative Agent shall have
received (a) a certificate of insurance from an independent insurance broker
dated as of the Effective Date, identifying insurers, types of insurance,
insurance limits, and policy terms, and otherwise describing the insurance
obtained in accordance with the provisions of Section 8.7 and (b) certified
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copies of all policies evidencing such insurance (or certificates therefor
signed by the insurer or an agent authorized to bind the insurer).
11.8. OPINIONS OF COUNSEL. The Agents shall have received favorable
legal opinions addressed to the Lenders and the Administrative Agent, dated as
of the Effective Date and in form and substance satisfactory to the Agents, from
counsel of the Borrower and its Subsidiaries.
11.9. PAYMENT OF FEES. The Borrower shall have paid to the Lenders, the
Agents or the Administrative Agent, as appropriate, the fees to be paid on the
Effective Date.
11.10. REPAYMENT OF INDEBTEDNESS. All amounts owing under the
Prepetition Credit Agreement and which are not refinanced hereunder shall have
been paid to the Administrative Agent for the accounts of the agents and lenders
party to the Prepetition Credit Agreement.
11.11. CASH BUDGET. The Lenders shall have received the Cash Budget in
form and substance reasonably satisfactory to the Lenders.
11.12. FIRST DAY ORDERS. The Administrative Agent shall have received a
signed copy of a Bankruptcy Court order, satisfactory to the Administrative
Agent, providing for the continuation of the Borrower's pre-petition cash
management system and deposit and disbursement accounts, including lockbox
accounts and deposit and disbursement accounts. All "first day orders" submitted
to the Bankruptcy Court on or about the Filing Date shall be in form and
substance reasonably satisfactory to the Agents.
Section 12. CONDITIONS TO ALL BORROWINGS. The obligations of the
Lenders to make any Revolving Credit Loan, and of the Issuing Bank to issue,
extend or renew any Letter of Credit, in each case whether on or after the
Effective Date, shall also be subject to the satisfaction of the following
conditions precedent.
12.1. REPRESENTATIONS TRUE. Each of the representations and warranties
of any of the Borrower and its Subsidiaries contained in this Credit Agreement
and the other Loan Documents shall be in all material respects true as of the
date as of which they were made and shall also be true at and as of the time of
the making of such Revolving Credit Loan or the issuance, extension or renewal
of such Letter of Credit, with the same effect as if made at and as of that time
(except to the extent of changes resulting from transactions contemplated or
permitted by this Credit Agreement and the other Loan Documents and changes
occurring in the ordinary course of business that singly or in the aggregate are
not materially adverse, and to the extent that such representations and
warranties relate expressly to an earlier date) and no Default or Event of
Default shall have occurred and be continuing.
12.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Lender would make it illegal for such Lender to make such Revolving
Credit Loan or to participate in the issuance, extension or renewal of such
Letter of Credit or in the reasonable opinion of the Issuing Bank would make it
illegal for the Issuing Bank to issue, extend or renew such Letter of Credit.
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12.3. GOVERNMENTAL REGULATION. Each Lender shall have received such
statements in substance and form reasonably satisfactory to such Lender as such
Lender shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of the
Federal Reserve System.
12.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in substance and in
form to the Lenders and to the Agents and the Administrative Agent's Special
Counsel, and the Lenders, the Agents and such counsel shall have received all
information and such counterpart originals or certified or other copies of such
documents as the Agents may reasonably request.
12.5. CASE ADMINISTRATION. The Interim Order shall be in full force and
effect and shall not have been reversed, modified or amended in any respect,
provided, that the Bankruptcy Court shall enter a final order (the "FINAL
ORDER") authorizing and approving this Credit Agreement pursuant to Section
364(c) and (d) of the Bankruptcy Code and Bankruptcy Rule 4001, in form and
substance satisfactory to the Agents finding that the Lenders are extending
credit to the Borrower in good faith pursuant to Section 364(e) of the
Bankruptcy Code, and the Final Order shall be in full force and effect, and
shall not have been reversed, modified or amended in any respect, prior to the
earlier to occur of (i) the date which is thirty (30) days after the date hereof
and (ii) the time of the making of any Loan or the issuance, extension or
renewal of any Letter of Credit the amount of which, when added to the principal
amount of all Loans or (as the case may be) the Maximum Drawing Amount of all
Letters of Credit then outstanding, would exceed the aggregate amount thereof
which was authorized by the Bankruptcy Court in the Interim Order for Loans or
Letters of Credit or both. If either the Interim Order or the Final Order is the
subject of a pending appeal in any respect, none of such Order, the making of
the Loans, the issuance, extension or renewal of any Letters of Credit, or the
performance by the Borrower or the Guarantor of any of its obligations under any
of the Loan Documents shall be the subject of a presently effective stay pending
appeal. The Borrower, the Guarantors and the Agents and the Lenders shall be
entitled to rely in good faith upon the Orders notwithstanding objection thereto
or appeal therefrom by any interested party. The Borrower, the Guarantors and
the Agents and the Lenders shall be permitted and required to perform their
respective obligations in compliance with this Credit Agreement notwithstanding
any such objection or appeal unless the relevant Order has been stayed by a
court of competent jurisdiction.
Section 13. EVENTS OF DEFAULT; ACCELERATION; ETC.
13.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("EVENTS OF DEFAULT" or, if the giving of notice or the lapse of time or
both is required, then, prior to such notice or lapse of time, "Defaults") shall
occur:
(a) the Borrower shall fail to pay any principal of the Revolving
Credit Loans when the same shall become due and payable, whether at the stated
date of maturity or any accelerated date of maturity or at any other date fixed
for payment;
(b) the Borrower shall fail to pay any interest on the Revolving Credit
Loans, the commitment fee, any Letter of Credit Fee, the Administrative Agent's
fee, or other sums due
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hereunder or under any of the other Loan Documents, within ten (10) days of the
stated date of maturity or any accelerated date of maturity or at any other date
fixed for payment;
(c) the Borrower shall fail to comply with any of its covenants
contained in Section 8.1 (including, as it applies to Section 13.1(b), any grace
period applicable thereto), Section 8.4 (within five (5) days of when any
monthly financial statement would otherwise be due and within fifteen (15) days
of when any quarterly or annual statement would otherwise be due), Section
8.5.1, Section 8.5.4 (within fifteen (15) days of when notice would otherwise be
due), the first sentence of Section 8.6, Section 8.7, Section 8.12, Section
Section 9.1 through 9.6, Section Section 9.8 through 9.13, Section 10 or any
covenant contained in the Mortgage the violation of which would constitute an
immediate "Event of Default" under such Mortgage;
(d) the Borrower shall fail to perform any term, covenant or agreement
contained herein or in any of the other Loan Documents (other than those
specified elsewhere in this Section 13.1) for thirty (30) days after written
notice of such failure has been given to the Borrower by the Administrative
Agent;
(e) any representation or warranty of the Borrower or any of its
Subsidiaries in this Credit Agreement or any of the other Loan Documents or in
any other document or instrument delivered pursuant to or in connection with
this Credit Agreement shall prove to have been false in any material respect
upon the date when made or deemed to have been made or repeated;
(f) the Borrower or any of its Subsidiaries shall default in the
payment when due of the principal of or interest on the post-petition
Indebtedness in excess of $1,000,000, or the pre-petition Indebtedness in excess
of $1,000,000 if, by order of the Bankruptcy Court issued with respect to such
pre-petition Indebtedness, a default thereunder would entitle the holder thereof
to relief from the automatic stay of Section 362 of the Bankruptcy Code of such
post-petition or pre-petition Indebtedness, or any event specified in any note,
agreement, indenture or other document evidencing or securing any such
Indebtedness shall occur if the effect of such event is to cause, or (with the
giving of notice or the lapse of time or both) to permit the holder or holders
of such Indebtedness (or a trustee or agent on behalf of such holder or holders)
to cause such Indebtedness to become due, or to be prepaid in full prior to its
stated maturity;
(g) the Borrower or a Guarantor shall be enjoined from conducting any
part of its business as a debtor in possession, or there shall occur any
disruption to such business, or there shall occur any loss or change in any
license or permit of the Borrower or the Guarantor, which in each such case
would reasonably be expected to have a material adverse effect on the Borrower
and its Subsidiaries, considered as a whole;
(h) (i) if any of the Loan Documents shall be canceled, terminated,
revoked or rescinded or the Administrative Agent's security interests or liens
in a substantial portion of the Collateral shall cease to be perfected, or shall
cease to have the priority contemplated by the Security Documents in each case
otherwise than in accordance with the terms thereof or with the express prior
written agreement, consent or approval of the Lenders, or (ii) any action at
law, suit or in equity or other legal proceeding to cancel, revoke or rescind
any of the Loan Documents shall be commenced by or on behalf of the Borrower or
any of its Subsidiaries party thereto or any of their respective stockholders,
or any court or any other governmental or regulatory authority or agency of
competent jurisdiction shall make a determination that, or
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issue a judgment, order, decree or ruling to the effect that, any one or more of
the Loan Documents is illegal, invalid or unenforceable in accordance with the
terms thereof;
(i) The Borrower or any ERISA Affiliate incurs any liability to the
PBGC or a Guaranteed Pension Plan in connection with the termination of a
Guaranteed Pension Plan pursuant to Title IV of ERISA in an aggregate amount
exceeding $15,000,000; the Borrower or any ERISA Affiliate is assessed
withdrawal liability pursuant to Title IV of ERISA by a Multiemployer Plan
requiring aggregate annual payments exceeding $15,000,000, or any of the
following occurs with respect to a Guaranteed Pension Plan: (i) a failure to
make timely (without consideration of any extension or waiver) any required
quarterly contribution or other payment pursuant to the funding provisions of
Section 302 of ERISA; (ii) the appointment by a United States District Court of
a trustee to administer such Plan; or (iii) the institution by the PBGC, or by
the Borrower, of proceedings (including before the PBGC) to terminate such Plan
other than in a standard termination within the meaning of Section 4041(b) of
ERISA.
(j) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any court or any
administrative or regulatory agency from conducting any material part of its
business and such order shall continue in effect for more than thirty (30) days;
(k) there shall occur any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike, lockout,
labor dispute, embargo, condemnation, act of God or public enemy, or other
casualty, which in any such case causes, for more than fifteen (15) consecutive
days, the cessation or substantial curtailment of revenue producing activities
at any facility of the Borrower or any of its Subsidiaries if such event or
circumstance is not covered by business interruption insurance and would have a
Material Adverse Effect;
(l) there shall occur the loss, suspension or revocation of, or failure
to renew, any license or permit now held or hereafter acquired by the Borrower
or any of its Subsidiaries if such loss, suspension, revocation or failure to
renew would have a Material Adverse Effect;
(m) the Borrower or any of its Subsidiaries shall be convicted for a
federal crime, a punishment for which could include the forfeiture of any assets
of the Borrower or such Subsidiary included in the Borrowing Base or any assets
of the Borrower or such Subsidiary not included in the Borrowing Base but having
a fair market value in excess of $5,000,000;
(n) a Change of Control shall have occurred;
(o) the Availability shall at any time be less than zero;
(p) the Bankruptcy Court shall enter any order (i) amending,
supplementing, altering, staying, vacating, rescinding or otherwise modifying
any Order without the consent of the Agents and the Lenders, (ii) appointing a
chapter 11 trustee 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 in any of the
Cases, (iii) dismissing any of the Cases or converting any of the Cases to a
chapter 7 case or (iv) granting relief from the automatic stay to any creditor
holding or asserting a Lien
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or reclamation claim on a material portion (i.e., more than $100,000 per
creditor or $500,000 in the aggregate) of the assets of the Borrower or a
Guarantor or where the deprivation of the Borrower or a Guarantor of such assets
would reasonably be expected to have a material adverse effect on the Borrower
and its Subsidiaries, considered as a whole;
(q) the Bankruptcy Court shall fail to enter the Final Order within
thirty (30) days of the Filing Date, such Final Order to be in form and
substance reasonably satisfactory to the Agents;
(r) an application shall be filed by the Borrower or a Guarantor for
the approval of any other Super-Priority Claim in any of the Cases which is PARI
PASSU with or senior to the claims of the Agents and the Lenders against the
Borrower or a Guarantor hereunder or under any of the other Loan Documents
(unless after giving effect to the transactions contemplated by such
application, all Obligations (whether contingent or otherwise) shall be paid in
full in cash and the Commitments shall be terminated), or there shall arise any
such Super-Priority Claim;
(s) the Borrower or a Guarantor shall be unable to pay its
post-petition debts as they mature or shall fail to comply with any order of the
Bankruptcy Court in any material respect;
(t) there shall remain undischarged for more than thirty (30) days any
final post-petition judgment or execution action against the Borrower or a
Guarantor, or relief from the automatic stay of Section 362(a) of the Bankruptcy
Code shall be granted to any creditor or creditors of the Borrower or a
Guarantor with respect to assets having an aggregate value in excess of $500,000
or where the deprivation of the Borrower or a Guarantor of such assets would
reasonably be expected to have a material adverse effect on the Borrower and its
Subsidiaries, considered as a whole;
(u) the Borrower or a Guarantor shall pay or discharge any pre-petition
Indebtedness (other than Prepetition Bank Debt, pre-petition Indebtedness
contemplated to be paid pursuant to the Cash Budget, and customary first day
orders reasonably acceptable to the Agents) in excess of $250,000 in the
aggregate;
(v) the Borrower or a Guarantor shall file a motion in any of the Cases
(i) to use cash collateral of the Lenders under Section 363(c) of the Bankruptcy
Code without the Lenders' consent, (ii) to recover from any portions of the
Collateral any costs or expenses of preserving or disposing of such Collateral
under Section 506(c) of the Bankruptcy Code, or (iii) to take any other action
or actions adverse to the Lenders or their rights and remedies hereunder or
under any of the other Loan Documents or the Lenders' interest in any of the
Collateral, which other action or actions would, individually or in the
aggregate, have a material adverse effect on the Borrower and its Subsidiaries,
considered as a whole;
(w) a suit or action against the Lenders or the Agents shall be
commenced by the Borrower, a Guarantor, any federal, state environmental
protection or health and safety agency or any official committee in any Case,
which suit or action asserts any claim or legal or equitable remedy
contemplating subordination of any claim or Lien of the Lenders or the Agents,
and, with respect to any suit or action by any such federal or state agency, (i)
a preliminary order for relief or judgment or decree shall have been entered in
such suit or action against the Lenders or
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the Agents or (ii) a motion to dismiss brought by the Lenders or the Agents in
response thereto shall have been denied;
(x) (i) the failure, by July 31, 2002, of a Reorganization Plan,
contemplating the repayment in full, in cash, of the Obligations (excluding any
such Obligations disallowed by the Bankruptcy Court pursuant to paragraph 21 of
the Interim Order) and the provision for the cash-collateralization of all
Letters of Credit in an amount equal to 110% of the Maximum Drawing Amount
thereof, to be filed with the Bankruptcy Court; (ii) the failure of such
Reorganization Plan to be confirmed by the Bankruptcy Court by November 15,
2002; or (iii) the failure of such Reorganization Plan to become effective by
December 1, 2002; or
(y) (i) actual expenditures for any line item for any month shall
exceed the amount set forth in the Cash Budget such line item for such month by
more than ten percent (10%)or (ii) actual disbursements for any month shall
exceed the total disbursement amount set forth in the Cash Budget for such month
by more than five percent (5%);
(z) Xxxxxx Xxxxxxxx or another person acceptable to the Majority
Lenders ceases to be the Chief Executive Officer of the Borrower; and
(aa) any unpaid and overdue liability in respect of employment and
trust fund taxes in excess of $250,000 in the aggregate;
then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Majority Lenders shall, by
notice in writing to the Borrower declare all amounts owing with respect to this
Credit Agreement, the Revolving Credit Notes and the other Loan Documents to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower.
13.2. TERMINATION OF COMMITMENTS. If any Event of Default shall have
occurred and be continuing, the Administrative Agent may and, upon the request
of the Majority Lenders, shall, by notice to the Borrower, terminate the unused
portion of the credit hereunder, and upon such notice being given such unused
portion of the credit hereunder shall terminate immediately and each of the
Lenders shall be relieved of all further obligations to make Revolving Credit
Loans and the Issuing Bank shall be relieved of all further obligations to
issue, extend or renew Letters of Credit. No termination of the credit hereunder
shall relieve the Borrower or any of its Subsidiaries of any of the Obligations.
13.3. REMEDIES. Upon the occurrence of an Identified Event of Default
and following the giving and expiration of five (5) Business Days' notice to the
Borrower, the Creditors' Committees of the Borrower, and the United States
Trustee, and without prejudice to any other rights and remedies the Agents and
the Lenders may have hereunder, the Agents and the Lenders shall have relief
from the automatic stay and may foreclose on all or any portion of the
Collateral, collect Accounts Receivable and apply the proceeds thereof to the
Obligations, occupy the Borrower's premises to complete inventories, fulfill
orders and sell inventories or otherwise exercise remedies against the
Collateral permitted by applicable nonbankruptcy law. During such five-Business
Day notice period, the Borrower shall be entitled to an emergency
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hearing with the Bankruptcy Court for the sole purposes of contesting whether an
Event of Default has occurred, but the Borrower shall have no right to seek to
use cash collateral of the Lenders under Section 363(c) of the Bankruptcy Code.
Unless during such period the Bankruptcy Court determines that an Event of
Default has not occurred, the automatic stay, as to the Lenders and the Agents,
shall automatically terminate at the end of such notice period and without
further notice or order.
In addition, in case any one or more of the Events of Default shall have
occurred and be continuing, and whether or not the Lenders shall have
accelerated the maturity of the Loans pursuant to Section 16.1, each Lender, if
owed any amount with respect to the Loans, Reimbursement Obligations or other
Obligations, may, and the Administrative Agent may, if requested by the Majority
Lenders and in its sole discretion, on behalf of the Majority, proceed to
protect and enforce its rights by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant or
agreement contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to such Lender are evidenced,
including after obtaining stay relief in the case of Events of Default not
constituting Identified Events of Default as permitted by applicable law the
obtaining of the EX PARTE appointment of a receiver, and, if such amount shall
have become due, by declaration or otherwise, proceed to enforce the payment
thereof or any other legal or equitable right of such Lender, PROVIDED that if
no Identified Event of Default has occurred, the Agents' and Lenders' rights to
exercise control over property of the estate shall be subject to having obtained
relief from the automatic stay from the Bankruptcy Court. No remedy herein
conferred upon any Lender or the Administrative Agent or the holder of any Note
or the purchaser of any Letter of Credit Participation is intended to be
exclusive of any other remedy and each and every remedy shall be cumulative and
shall be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute or any other provision of law.
13.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that, following
the occurrence or during the continuance of any Default or Event of Default, the
Administrative Agent or any Lender, as the case may be, receives any monies in
connection with the enforcement of any the Security Documents, or otherwise with
respect to the realization upon any of the Collateral, such monies shall be
distributed for application as follows:
(a) FIRST, to the payment of, or (as the case may be) the reimbursement
of the Administrative Agent for or in respect of all reasonable costs, expenses,
disbursements and losses which shall have been incurred or sustained by the
Administrative Agent in connection with the collection of such monies by the
Administrative Agent, for the exercise, protection or enforcement by the
Administrative Agent of all or any of the rights, remedies, powers and
privileges of the Administrative Agent under this Credit Agreement or any of the
other Loan Documents or in respect of the Collateral or in support of any
provision of adequate indemnity to the Administrative Agent against any taxes or
liens which by law shall have, or may have, priority over the rights of the
Administrative Agent to such monies;
(b) SECOND, to all other Obligations (other than those Obligations
arising or incurred under any ancillary facilities provided by the
Administrative Agent or any Lenders in their individual capacities to the
Borrower) in such order or preference as the Majority Lenders may determine;
PROVIDED, HOWEVER, that distributions in respect of (i) such obligations shall
be made
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PARI PASSU among Obligations with respect to the Administrative Agent's fee
payable pursuant to Section 5.1 and all other Obligations and (ii) Obligations
owing to the Lenders with respect to each type of Obligation such as interest,
principal, fees and expenses, shall be made among the Lenders PRO RATA; and
PROVIDED, FURTHER, that the Administrative Agent may in its discretion make
proper allowance to take into account any Obligations not then due and payable;
(c) THIRD, to those Obligations arising under any cash management
services, Rate Protection Agreements or any other ancillary facilities provided
by the Administrative Agent or any other Lenders in their individual capacities
to the Borrower in connection with this Agreement;
(d) FOURTH, upon payment and satisfaction in full or other provisions
for payment in full satisfactory to the Lenders and the Administrative Agent of
all of the Obligations, to the payment of any obligations required to be paid
pursuant to Section 9-504(1)(c) of the Uniform Commercial Code of the
Commonwealth of Massachusetts; and
(e) FIFTH, the excess, if any, shall be returned to the Borrower or to
such other Persons as are entitled thereto.
Section 14. SETOFF. Regardless of the adequacy of any collateral,
during the continuance of any Event of Default, any deposits or other sums
credited by or due from any of the Lenders to the Borrower and any securities or
other property of the Borrower in the possession of such Lender may be applied
to or set off by such Lender against the payment of Obligations and any and all
other liabilities, direct or indirect, absolute or contingent, due or to become
due, now existing or hereafter arising, of the Borrower to such Lender. Each of
the Lenders agrees with each other Lender that (a) if an amount to be set off is
to be applied to Indebtedness of the Borrower to such Lender, other than
Indebtedness evidenced by the Revolving Credit Notes held by such Lender or
constituting Reimbursement Obligations owed to such Lender, such amount shall be
applied ratably to such other Indebtedness and to the Indebtedness evidenced by
all such Notes held by such Lender or constituting Reimbursement Obligations
owed to such Lender and (b) if such Lender shall receive from the Borrower,
whether by voluntary payment, exercise of the right of setoff, counterclaim,
cross action, enforcement of the claim evidenced by the Revolving Credit Notes
held by, or constituting Reimbursement Obligations owed to, such Lender by
proceedings against the Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings, or
otherwise, and shall retain and apply to the payment of the Revolving Credit
Note or Notes held by, or constituting Reimbursement Obligations owed to, such
Lender any amount in excess of its ratable portion of the payments received by
all of the Lenders with respect to the Revolving Credit Notes held by all of the
Lenders, such Lender will make such disposition and arrangements with the other
Lenders with respect to such excess, either by way of distribution, PRO TANTO
assignment of claims, subrogation or otherwise as shall result in each Lender
receiving in respect of the Revolving Credit Notes held by it or Reimbursement
Obligations owed it, its proportionate payment as contemplated by this Credit
Agreement; PROVIDED that if all or any part of such excess payment is thereafter
recovered from such Lender, such disposition and arrangements shall be rescinded
and the amount restored to the extent of such recovery, but without interest.
Section 15. THE ADMINISTRATIVE AGENT.
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15.1. AUTHORIZATION.
(a) The Administrative Agent is authorized to take such action on
behalf of each of the Lenders and to exercise all such powers as are hereunder
and under any of the other Loan Documents and any related documents delegated to
the Administrative Agent, together with such powers as are reasonably incident
thereto, PROVIDED that no duties or responsibilities not expressly assumed
herein or therein shall be implied to have been assumed by the Administrative
Agent.
(b) The relationship between the Administrative Agent and each of the
Lenders is that of an independent contractor. The use of the term
"Administrative Agent" is for convenience only and is used to describe, as a
form of convention, the independent contractual relationship between the
Administrative Agent and each of the Lenders. Nothing contained in this Credit
Agreement nor the other Loan Documents shall be construed to create an agency,
trust or other fiduciary relationship between the Administrative Agent and any
of the Lenders.
(c) As an independent contractor empowered by the Lenders to exercise
certain rights and perform certain duties and responsibilities hereunder and
under the other Loan Documents, the Administrative Agent is nevertheless a
"representative" of the Lenders, as that term is defined in Article 1 of the
Uniform Commercial Code, for purposes of actions for the benefit of the Lenders
and the Administrative Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents. Such actions include the
designation of the Administrative Agent as "secured party", "mortgagee" or the
like on all financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority or
enforcement of any security interests, mortgages or deeds of trust in collateral
security intended to secure the payment or performance of any of the
Obligations, all for the benefit of the Lenders and the Administrative Agent.
15.2. EMPLOYEES AND AGENTS. The Administrative Agent may exercise its
powers and execute its duties by or through employees or agents and shall be
entitled to take, and to rely on, advice of counsel concerning all matters
pertaining to its rights and duties under this Credit Agreement and the other
Loan Documents. The Administrative Agent may utilize the services of such
Persons as the Administrative Agent in its sole discretion may reasonably
determine, and all reasonable fees and expenses of any such Persons shall be
paid by the Borrower.
15.3. NO LIABILITY. Neither the Administrative Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent or employee thereof, shall be liable for any
waiver, consent or approval given or any action taken, or omitted to be taken,
in good faith by it or them hereunder or under any of the other Loan Documents,
or in connection herewith or therewith, or be responsible for the consequences
of any oversight or error of judgment whatsoever, except that the Administrative
Agent or such other Person, as the case may be, may be liable for losses due to
its willful misconduct or gross negligence.
15.4. NO REPRESENTATIONS. The Administrative Agent shall not be
responsible for the execution or validity or enforceability of this Credit
Agreement, the Revolving Credit Notes, the Letters of Credit, any of the other
Loan Documents or any instrument at any time constituting, or intended to
constitute, collateral security for the Revolving Credit Notes, or for the value
of
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any such collateral security or for the validity, enforceability or
collectability of any such amounts owing with respect to the Revolving Credit
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Borrower or any of its
Subsidiaries, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or in
any instrument at any time constituting, or intended to constitute, collateral
security for the Revolving Credit Notes or to inspect any of the properties,
books or records of the Borrower or any of its Subsidiaries. The Administrative
Agent shall not be bound to ascertain whether any notice, consent, waiver or
request delivered to it by the Borrower or any holder of any of the Revolving
Credit Notes shall have been duly authorized or is true, accurate and complete.
The Administrative Agent has not made nor does it now make any representations
or warranties, express or implied, nor does it assume any liability to the
Lenders, with respect to the creditworthiness or financial conditions of the
Borrower or any of its Subsidiaries. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender, and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into this Credit
Agreement.
15.5. PAYMENTS.
15.5.1. PAYMENTS TO ADMINISTRATIVE AGENT. A payment by the
Borrower to the Administrative Agent hereunder or any of the other Loan
Documents for the account of any Lender shall constitute a payment to
such Lender. The Administrative Agent agrees promptly to distribute to
each Lender such Lender's PRO RATA share of payments received by the
Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.
15.5.2. DISTRIBUTION BY ADMINISTRATIVE AGENT. If in the
opinion of the Administrative Agent the distribution of any amount
received by it in such capacity hereunder, under the Revolving Credit
Notes or under any of the other Loan Documents might involve it in
liability, it may refrain from making distribution until its right to
make distribution shall have been adjudicated by a court of competent
jurisdiction. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Administrative Agent is to
be repaid, each Person to whom any such distribution shall have been
made shall either repay to the Administrative Agent its proportionate
share of the amount so adjudged to be repaid or shall pay over the same
in such manner and to such Persons as shall be determined by such
court.
15.5.3. DELINQUENT LENDERS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Lender that fails (a) to make available to the
Administrative Agent its PRO RATA share of any Revolving Credit Loan or
to purchase or make any payment on account of any Letter of Credit
Participation or (b) to comply with the provisions of Section 14 with
respect to making dispositions and arrangements with the other Lenders,
where such Lender's share of any payment received, whether by setoff or
otherwise, is in excess of its PRO RATA share of such payments due and
payable to all of the Lenders, in each case as, when and to the full
extent required by the provisions of this Credit Agreement or Section
15.7, shall be deemed
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delinquent (a "Delinquent Lender") and shall be deemed a Delinquent
Lender until such time as such delinquency is satisfied. A Delinquent
Lender shall be deemed to have assigned any and all payments due to it
from the Borrower, whether on account of outstanding Revolving Credit
Loans, Unpaid Reimbursement Obligations, interest, fees or otherwise,
to the remaining nondelinquent Lenders for application to, and
reduction of, their respective PRO RATA shares of all outstanding
Revolving Credit Loans and Unpaid Reimbursement Obligations. The
Delinquent Lender hereby authorizes the Administrative Agent to
distribute such payments to the nondelinquent Lenders in proportion to
their respective PRO RATA shares of all outstanding Revolving Credit
Loans and Unpaid Reimbursement Obligations. A Delinquent Lender shall
be deemed to have satisfied in full a delinquency when and if, as a
result of application of the assigned payments to all outstanding
Revolving Credit Loans of the nondelinquent Lenders, the Lenders'
respective PRO RATA shares of all outstanding Revolving Credit Loans
and Unpaid Reimbursement Obligations have returned to those in effect
immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency. Until such delinquency is
satisfied, the Delinquent Lender shall have no right to participate in
any vote on or consent to any matter in respect of or in connection
with this Credit Agreement.
15.6. HOLDERS OF REVOLVING CREDIT NOTES. The Administrative Agent may
deem and treat the payee of any Revolving Credit Note and the purchaser of any
Letter of Credit Participation as the absolute owner or purchaser thereof for
all purposes hereof until it shall have been furnished in writing with a
different name by such payee or by a subsequent holder, assignee or transferee.
15.7. INDEMNITY. The Lenders ratably agree hereby to indemnify and hold
harmless the Administrative Agent from and against any and all claims, actions
and suits (whether groundless or otherwise), losses, damages, costs, expenses
(including any expenses for which the Administrative Agent has not been
reimbursed by the Borrower as required by Section 16), and liabilities of every
nature and character arising out of or related to this Credit Agreement, the
Revolving Credit Notes, or any of the other Loan Documents or the transactions
contemplated or evidenced hereby or thereby, or the Administrative Agent's
actions taken hereunder or thereunder without limiting the Borrower's and
Guarantors' indemnity obligations, except to the extent that any of the same
shall be directly caused by the Administrative Agent's willful misconduct or
gross negligence.
15.8. ADMINISTRATIVE AGENT AS LENDER. In its individual capacity, Fleet
shall have the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Revolving Credit Loans made by it, and as the
holder of any of the Revolving Credit Notes and as the purchaser of any Letter
of Credit Participations, as it would have were it not also the Administrative
Agent.
15.9. RESIGNATION. The Administrative Agent may resign at any time by
giving sixty (60) days' prior written notice thereof to the Lenders and the
Borrower. Upon any such resignation, the Majority Lenders shall have the right
to appoint a successor Administrative Agent. Unless a Default or Event of
Default shall have occurred and be continuing, such successor Administrative
Agent shall be reasonably acceptable to the Borrower. If no successor
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Administrative Agent shall have been so appointed by the Majority Lenders and
shall have accepted such appointment within thirty (30) days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a financial institution having a rating of
not less than A or its equivalent by Standard & Poor's Ratings Group. 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 hereunder. After any
retiring Administrative Agent's resignation, the provisions of this Credit
Agreement and the other Loan Documents shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was acting
as Administrative Agent.
15.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Lender
hereby agrees that, upon learning of the existence of a Default or an Event of
Default, it shall promptly notify the Administrative Agent thereof. The
Administrative Agent hereby agrees that upon receipt of any notice under this
Section 15.10 it shall promptly notify the other Lenders of the existence of
such Default or Event of Default.
15.11. DUTIES IN THE CASE OF ENFORCEMENT. In case one of more Events of
Default have occurred and shall be continuing, and whether or not acceleration
of the Obligations shall have occurred, the Administrative Agent shall, if (a)
so requested by the Majority Lenders and (b) the Lenders have provided to the
Administrative Agent such additional indemnities and assurances against expenses
and liabilities as the Administrative Agent may reasonably request, proceed to
enforce the provisions of the Security Documents authorizing the sale or other
disposition of all or any part of the Collateral and exercise all or any such
other legal and equitable and other rights or remedies as it may have in respect
of such Collateral. The Majority Lenders may direct the Administrative Agent in
writing as to the method and the extent of any such sale or other disposition,
the Lenders hereby agreeing to indemnify and hold the Administrative Agent
harmless from all liabilities incurred in respect of all actions taken or
omitted in accordance with such directions, provided that the Administrative
Agent need not comply with any such direction to the extent that the
Administrative Agent reasonably believes the Administrative Agent's compliance
with such direction to be unlawful or commercially unreasonable in any
applicable jurisdiction.
Section 16. EXPENSES. The Borrower agrees to pay (a) the reasonable
costs of producing and reproducing this Credit Agreement, the other Loan
Documents and the other agreements and instruments mentioned herein, (b) any
excise taxes or current or future stamp or documentary taxes or similar charges
(including any interest and penalties in respect thereto) payable by the any
Agent or Lender (other than taxes based upon the Agents' or any Lender's net
income) on or with respect to the transactions contemplated by this Credit
Agreement (the Borrower hereby agreeing to indemnify each Agent and each Lender
with respect thereto), (c) the reasonable fees, expenses and disbursements of
the Administrative Agent's Special Counsel and any local counsel to the Agents
incurred in connection with the preparation, administration, interpretation or
syndication of the Loan Documents and other instruments mentioned herein, any
cash management documentation and related matters, each closing hereunder, and
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amendments, modifications, approvals, consents or waivers hereto or hereunder,
or the cancellation of any Loan Document upon payment in full in cash of all of
the Obligations or pursuant to any terms of such Loan Document for providing for
such cancellation, (d) the fees, expenses and disbursements of any Agent
incurred by such Agent in connection with the preparation, administration,
interpretation or syndication of the Loan Documents and other instruments
mentioned herein, including all monitoring of the Cases and all appraisal
charges and charges of other professionals retained by such Agent, (e) the fees,
expenses and disbursements of the Agents incurred by the Agents or their
designees in connection with all commercial finance examinations conducted by or
on behalf of the Agents, (f) any fees, costs, expenses and bank charges,
including bank charges for returned checks, incurred by the Administrative Agent
in establishing, maintaining or handling agency accounts, lock box accounts and
other accounts for the collection of any of the Collateral; (g) the reasonable
fees and expenses of any advisors retained by the Administrative Agent pursuant
to Section Section 8.16 and 8.18; (h) all reasonable out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, which
attorneys may be employees of any Lender or any Agent, and reasonable
consulting, accounting, appraisal, investment banking and similar professional
fees and charges) incurred by any Lender or any Agent in connection with (i) the
enforcement of or preservation of rights under any of the Loan Documents against
the Borrower or any of its Subsidiaries or the administration thereof after the
occurrence of a Default or Event of Default and (ii) any litigation, proceeding
or dispute whether arising hereunder or otherwise, in any way related to any
Lender's or any Agent's relationship with the Borrower or any of its
Subsidiaries, (iii) in connection with any refinancing or restructuring of the
financing under the Loan Documents in the nature of a "work-out" or in any
insolvency or bankruptcy proceeding, and (iv) all reasonable fees, expenses and
disbursements of any Lender or any Agent incurred in connection with UCC
searches or UCC filings. The covenants of this Section 16 shall survive payment
or satisfaction of all other Obligations.
Section 17. INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Agents, the Lenders and their respective shareholders, directors,
agents, officers, subsidiaries and affiliates from and against any and all
claims, actions and suits whether groundless or otherwise, and from and against
any and all liabilities, losses, damages and reasonable expenses of every nature
and character arising out of this Credit Agreement or any of the other Loan
Documents or the transactions contemplated hereby including, without limitation,
(a) any actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Revolving Credit Loans or Letters of Credit, (b) the
reversal or withdrawal of any provisional credits granted by the Administrative
Agent upon the transfer of funds from bank agency or lock box accounts or in
connection with the provisional honoring of checks or other items, (c) any
actual or alleged infringement of any patent, copyright, trademark, service xxxx
or similar right of the Borrower or any of its Subsidiaries comprised in the
Collateral, (d) the Borrower or any of its Subsidiaries entering into or
performing this Credit Agreement or any of the other Loan Documents or (e) with
respect to the Borrower and its Subsidiaries and their respective properties and
assets, the violation of any Environmental Law, the disposal, discharge, release
or threatened release of any Hazardous Substances or any action, suit,
proceeding or investigation brought or threatened with respect to any Hazardous
Substances (including, but not limited to, claims with respect to wrongful
death, personal injury or damage to property), in each case including, without
limitation, the reasonable fees and disbursements of counsel and allocated costs
of internal counsel incurred in connection with any such investigation,
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litigation or other proceeding, PROVIDED, HOWEVER, that the foregoing indemnity
as to any Person shall not apply to liabilities, damages, losses, settlement
expenses and expenses to the extent that they arise from the willful misconduct
or gross negligence of such indemnified person or its Affiliates. In litigation,
or the preparation therefor, each of the Lenders and the Agents shall be
entitled to select their own counsel and, in addition to the foregoing
indemnity, the Borrower agrees to pay promptly the reasonable fees and expenses
of such counsel. If, and to the extent that the obligations of the Borrower
under this Section 17 are unenforceable for any reason, the Borrower hereby
agrees to make the maximum contribution to the payment in satisfaction of such
indemnified obligations which is permissible under applicable law. The covenants
contained in this Section 17 shall survive payment or satisfaction in full of
all other Obligations.
Section 18. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Revolving Credit Notes, in
any of the other Loan Documents or in any documents or other papers delivered by
or on behalf of the Borrower or any of its Subsidiaries pursuant hereto shall be
deemed to have been relied upon by the Lenders and the Agents, notwithstanding
any investigation heretofore or hereafter made by any of them, and shall survive
the making by the Lenders of any of the Revolving Credit Loans and the issuance,
extension or renewal of any Letters of Credit, as herein contemplated, and shall
continue in full force and effect so long as any Letter of Credit or any amount
due under this Credit Agreement or the Revolving Credit Notes or any of the
other Loan Documents remains outstanding or any Lender has any obligation to
make any Revolving Credit Loans or the Issuing Bank has any obligation to issue,
extend or renew any Letter of Credit, and for such further time as may be
otherwise expressly specified in this Credit Agreement. All statements contained
in any certificate or other paper delivered to any Lender or the Administrative
Agent at any time by or on behalf of the Borrower or any of its Subsidiaries
pursuant hereto or in connection with the transactions contemplated hereby shall
constitute representations and warranties by the Borrower or such Subsidiary
hereunder.
Section 19. ASSIGNMENT AND PARTICIPATION.
19.1. CONDITIONS TO ASSIGNMENT BY LENDERS. Except as provided herein,
each Lender may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all or
a portion of its Commitment Percentage and Commitment and the same portion of
the Revolving Credit Loans at the time owing to it, the Revolving Credit Notes
held by it and its participating interest in the risk relating to any Letters of
Credit); provided that (a) each of the Administrative Agent and, unless a
Default or Event of Default shall have occurred and be continuing, the Borrower
shall have given its prior written consent to such assignment, which consent, in
the case of the Borrower, will not be unreasonably withheld, (b) each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Lender's rights and obligations under this Credit Agreement, (c) each
assignment shall be in an amount that is not less than $5,000,000 or the
remaining amount of its Commitment, if less, and (d) the parties to such
assignment shall execute and deliver to the Administrative Agent, for recording
in the Register (as hereinafter defined), an Assignment and Acceptance,
substantially in the form of EXHIBIT E hereto (an "ASSIGNMENT AND ACCEPTANCE"),
together with any Revolving Credit Notes subject to such assignment. Upon such
execution, delivery, acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be at
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least five (5) Business Days after the execution thereof, (i) the assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender
hereunder, and (ii) the assigning Lender shall, to the extent provided in such
assignment and upon payment to the Administrative Agent of the registration fee
referred to in Section 19.3, be released from its obligations under this Credit
Agreement.
19.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows: (a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free and clear
of any adverse claim, the assigning Lender makes no representation or warranty,
express or implied, and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or mortgage; (b) the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower and its
Subsidiaries or any other Person primarily or secondarily liable in respect of
any of the Obligations, or the performance or observance by the Borrower and its
Subsidiaries or any other Person primarily or secondarily liable in respect of
any of the Obligations or any of their other obligations under this Credit
Agreement or any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; (c) such assignee confirms that it has
received a copy of this Credit Agreement, together with copies of the most
recent financial statements referred to in Section 7.4 and Section 8.4 and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance; (d)
such assignee will, independently and without reliance upon the assigning
Lender, the Administrative Agent or any other Lender and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Credit Agreement;
(e) such assignee represents and warrants that it is an Eligible Assignee; (f)
such assignee appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this Credit
Agreement and the other Loan Documents as are delegated to the Administrative
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto; (g) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Credit Agreement are required to be performed by it as a Lender; (h) such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Acceptance; and (i) such assignee acknowledges that it has
made arrangements with the assigning Lender satisfactory to such assignee with
respect to its PRO RATA share of Letter of Credit Fees in respect of outstanding
Letters of Credit.
19.3. REGISTER. The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register or similar list (the
"REGISTER") for the recordation of the names and addresses of the Lenders and
the Commitment Percentage of, and principal amount of the Revolving Credit Loans
owing to and Letter of Credit Participations purchased by, the Lenders from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the Lenders may
treat each
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Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrower and the Lenders at any reasonable time and from time
to time upon reasonable prior notice. Upon each such recordation, the assigning
Lender agrees to pay to the Administrative Agent a registration fee in the sum
of $3,500.
19.4. NEW REVOLVING CREDIT NOTES. 19.4.Upon its receipt of an
Assignment and Acceptance executed by the parties to such assignment, together
with each Revolving Credit Note subject to such assignment, the Administrative
Agent shall (a) record the information contained therein in the Register, and
(b) give prompt notice thereof to the Borrower and the Lenders (other than the
assigning Lender). Within five (5) Business Days after receipt of such notice,
the Borrower, at its own expense, shall execute and deliver to the
Administrative Agent, in exchange for each surrendered Revolving Credit Note, a
new Revolving Credit Note to the order of such Eligible Assignee in an amount
equal to the amount assumed by such Eligible Assignee pursuant to such
Assignment and Acceptance and, if the assigning Lender has retained some portion
of its obligations hereunder, a new Revolving Credit Note to the order of the
assigning Lender in an amount equal to the amount retained by it hereunder. Such
new Notes shall provide that they are replacements for the surrendered Revolving
Credit Notes, shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Revolving Credit Notes, shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be
substantially in the form of the assigned Revolving Credit Notes. The
surrendered Revolving Credit Notes shall be canceled and returned to the
Borrower.
19.5. PARTICIPATIONS. Each Lender may sell participations to one or
more banks or other entities in all or a portion of such Lender's rights and
obligations under this Credit Agreement and the other Loan Documents; provided
that (a) each such participation shall be in an amount of not less than
$10,000,000, (b) any such sale or participation shall not affect the rights and
duties of the selling Lender hereunder to the Borrower and (c) the only right of
the assignor granted to the participant pursuant to such participation
arrangements with respect to waivers, amendments or modifications of the Loan
Documents shall be such assignor's right to approve waivers, amendments or
modifications that would require the consent of all Lenders affected thereby.
19.6. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Lender is an Affiliate of the Borrower, then any such assignee Lender
shall have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Administrative Agent pursuant to Section
13.1 or Section 13.2, and the determination of the Majority Lenders shall for
all purposes of this Agreement and the other Loan Documents be made without
regard to such assignee Lender's interest in any of the Revolving Credit Loans.
If any Lender sells a participating interest in any of the Revolving Credit
Loans to a participant, and such participant is the Borrower or an Affiliate of
the Borrower, then such transferor Lender shall promptly notify the
Administrative Agent of the sale of such participation. A transferor Lender
shall have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Administrative Agent pursuant to Section 13.1
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or Section 13.2 to the extent that such participation is beneficially owned by
the Borrower or any Affiliate of the Borrower, and the determination of the
Majority Lenders shall for all purposes of this Credit Agreement and the other
Loan Documents be made without regard to the interest of such transferor Lender
in the Revolving Credit Loans to the extent of such participation.
19.7. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Lender shall
retain its rights to be indemnified pursuant to Section 17 with respect to any
claims or actions arising prior to the date of such assignment. If any assignee
Lender is not incorporated under the laws of the United States of America or any
state thereof, it shall, prior to the date on which any interest or fees are
payable hereunder or under any of the other Loan Documents for its account,
deliver to the Borrower and the Administrative Agent certification as to its
exemption from deduction or withholding of any United States federal income
taxes. If any Reference Lender transfers all of its interest, rights and
obligations under this Credit Agreement, the Administrative Agent shall, in
consultation with the Borrower and with the consent of the Borrower and the
Majority Lenders, appoint another Lender to act as a Reference Lender hereunder.
Anything contained in this Section 19 to the contrary notwithstanding, any
Lender may at any time pledge all or any portion of its interest and rights
under this Credit Agreement (including all or any portion of its Revolving
Credit Notes) to any of the twelve Federal Reserve Lenders organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the pledgor Lender from its obligations
hereunder or under any of the other Loan Documents.
19.8. ASSIGNMENT BY BORROWER. The Borrower shall not assign or transfer
any of its rights or obligations under any of the Loan Documents without the
prior written consent of each of the Lenders.
Section 20. NOTICES, ETC. Except as otherwise expressly provided in
this Credit Agreement, all notices and other communications made or required
to be given pursuant to this Credit Agreement or the Revolving Credit Notes or
any Letter of Credit Applications shall be in writing and shall be delivered
in hand, mailed by United States registered or certified first class mail,
postage prepaid, sent by overnight courier, or sent by facsimile and confirmed
by delivery via courier or postal service or by facsimile transmission
confirmation, as the case may be, addressed as follows:
(a) if to the Borrower, at 0000 Xxxxxxx Xxxxxxx, Xxxxx, XX 00000,
Attention: Chief Executive Officer, or at such other address for notice as the
Borrower shall last have furnished in writing to the Person giving the notice;
(b) if to the Administrative Agent, at Xxx Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, XXX, Attention: Xxxxxx X. Xxxxxxx, Xx., or such other
address or addressee for notice as the Administrative Agent shall last have
furnished in writing to the Person giving the notice; and
(c) if to any Lender, at such Lender's address set forth on SCHEDULE 1
hereto, or such other address for notice as such Lender shall have last
furnished in writing to the Person giving the notice.
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Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile
with transmission confirmed and (ii) if sent by registered or certified
first-class mail, postage prepaid, on the third Business Day following the
mailing thereof.
Section 21. GOVERNING LAW. THIS CREDIT AGREEMENT AND, EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE
CONTRACTS UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL
PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID
COMMONWEALTH (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH
OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN Section 20. THE
BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT.
Section 22. HEADINGS. The captions in this Credit Agreement are for
convenience of reference only and shall not define or limit the provisions
hereof.
Section 23. COUNTERPARTS. This Credit Agreement and any amendment
hereof may be executed in several counterparts and by each party on a separate
counterpart, each of which when executed and delivered shall be an original, and
all of which together shall constitute one instrument. In proving this Credit
Agreement it shall not be necessary to produce or account for more than one such
counterpart signed by the party against whom enforcement is sought.
Section 24. ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions contemplated
hereby. Neither this Credit Agreement nor any term hereof may be changed,
waived, discharged or terminated, except as provided in Section 26.
Section 25. WAIVER OF JURY TRIAL. Each party to this Credit Agreement
hereby waives its right to a jury trial with respect to any action or claim
arising out of any dispute in connection with this Credit Agreement, the
Revolving Credit Notes or any of the other Loan Documents, any rights or
obligations hereunder or thereunder or the performance of which rights and
obligations. Except as prohibited by law, the Borrower and each Guarantor hereby
waives any right it may have to claim or recover in any litigation referred to
in the preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages. The
Borrower and each Guarantor (a) certifies that no representative, agent or
attorney of any Lender or the Administrative Agent has represented, expressly or
otherwise, that such Lender or the Administrative Agent would not, in the event
of litigation, seek to enforce the foregoing waivers and (b) acknowledges that
the Administrative Agent and the Lenders have been induced to enter into this
Credit Agreement, the other Loan
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Documents to which it is a party by, among other things, the waivers and
certifications contained herein.
Section 26. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or approval
required or permitted by this Credit Agreement to be given by the Lenders may be
given, and any term of this Credit Agreement, the other Loan Documents or any
other instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower or any of its Subsidiaries of any
terms of this Credit Agreement, the other Loan Documents or such other
instrument or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Majority Lenders. Notwithstanding the foregoing, (i) any
decrease in the rate of interest on the Revolving Credit Notes (other than in
connection with the waiver of Section 5.10.2), any extension of scheduled
maturity of the Revolving Credit Notes, any increase in the amount of the
Commitments of the Lenders, any decrease in the amount of commitment fee, Letter
of Credit Fees or any other fee hereunder, any amendments or waivers which have
the effect of directly increasing the Eligible Fixed Asset Cap or the cap on the
amount of the Borrowing Base that may be allocated to Eligible Inventory set
forth in clause (b) of the definition of Borrowing Base and increases in the
percentages set forth in the definition of Borrowing Base (including the Special
Inventory Advance), and any amendments or waivers which would reduce the amount
of minimum liquidity required by Section 10.3 (in each case in this clause (i)
except that any amendment or modification to the definitions in this Agreement
relating to the calculation of the Borrowing Base and eligibility criteria,
except as set forth above. shall be approved by the Majority Lenders and each of
the Agents), any release of a substantial portion of the Collateral (other than
as provided for in clauses (iv) and (v) below) and any amendment of this Section
26 requires the written consent of the Borrower and the written consent of each
Lender affected thereby, (ii) the definition of "Majority Lenders" may not be
amended without the written consent of all of the Lenders, (iii) the definition
of "Agents" may not be amended without the written consent of all of the Agents,
(iv) Collateral consisting of assets disposed of pursuant to Section 9.6 may be
released in connection with such disposition, (v) Collateral consisting of the
Canton Cast-Roll Facility and pledged stock or membership interests constituting
Collateral may be released in connection with the permitted incurrence by the
Borrower of the permitted disposition of the Canton Cast-Roll Facility (without
implying any such required permission will be given by the Lenders), (vi)
amendments and waivers of definitions of this Credit Agreement relating to
eligibility criteria for assets included in the Borrowing Base require the
consent of Majority Lenders and each of the Agents, (vii) the amount of the
Administrative Agent's fee or any other fees payable for the Administrative
Agent's account and Section 15 may not be amended without the written consent of
the Agent and (viii) the amount of any Letter of Credit Fees or other fees
payable for the Issuing Bank's account and Section 4 may not be amended without
the consent of the Issuing Bank. No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon. No
course of dealing or delay or omission on the part of the Administrative Agent
or any Lender in exercising any right shall operate as a waiver thereof or
otherwise be prejudicial thereto. No notice to or demand upon the Borrower shall
entitle the Borrower to other or further notice or demand in similar or other
circumstances.
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Section 27. SEVERABILITY. The provisions of this Credit Agreement are
severable and if any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Credit
Agreement in any jurisdiction.
Section 28. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
Section 28.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY. The
Borrower acknowledges that from time to time financial advisory, investment
banking and other services may be offered or provided to the Borrower or one or
more of its Subsidiaries, in connection with this Credit Agreement or otherwise,
by a Section 20 Subsidiary. The Borrower, for itself and each of its
Subsidiaries, hereby authorizes (a) such Section 20 Subsidiary to share with
each Agent and each Lender any information delivered to such Section 20
Subsidiary by the Borrower or any of its Subsidiaries, and (b) each Agent and
each Lender to share with such Section 20 Subsidiary any information delivered
to such Agent or such Lender by the Borrower or any of its Subsidiaries pursuant
to this Credit Agreement, or in connection with the decision of such Lender to
enter into this Credit Agreement; it being understood, in each case, that any
such Section 20 Subsidiary receiving such information shall be bound by the
confidentiality provisions of this Credit Agreement. Such authorization shall
survive the payment and satisfaction in full of all of Obligations.
Section 28.2. CONFIDENTIALITY. Each of the Lenders and the each Agent
agrees, on behalf of itself and each of its affiliates, directors, officers,
employees and representatives, to use reasonable precautions to keep
confidential, in accordance with their customary procedures for handling
confidential information of the same nature and in accordance with safe and
sound banking practices, any non-public information supplied to it by the
Borrower or any of its Subsidiaries pursuant to this Credit Agreement that is
identified by such Person as being confidential at the time the same is
delivered to the Lenders or the Agents, PROVIDED that nothing herein shall limit
the disclosure of any such information (a) after such information shall have
become public other than through a violation of this Section 28, (b) to the
extent required by statute, rule, regulation or judicial process, (c) to counsel
for any of the Lenders or any Agent, (d) to bank examiners or any other
regulatory authority having jurisdiction over any Lender or the Administrative
Agent, or to auditors or accountants, (e) to any Agent, any Lender or any
Section 20 Subsidiary, (f) in connection with any litigation to which any one or
more of the Lenders, any Agent or any Section 20 Subsidiary is a party, or in
connection with the enforcement of rights or remedies hereunder or under any
other Loan Document, (g) to a Subsidiary or affiliate of such Lender as provided
in Section 28.1 or (h) to any assignee or participant (or prospective assignee
or participant) so long as such assignee or participant agrees to be bound by
the provisions of Section 8.9.1. Any Agents, the Lenders and any Section 20
Subsidiary may refer to any of the Borrower and its Subsidiaries in connection
with any advertising, promotion or marketing undertaken by such Agent, such
Lender or such Section 20 Subsidiary and, for such purpose, such Agent, such
Lender or such Section 20 Subsidiary may utilize any trade name, trademark, logo
or other distinctive symbol associated with the Borrower or any of its
Subsidiaries or any of their businesses.
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Section 28.3. PRIOR NOTIFICATION. Unless specifically prohibited by
applicable law or court order, each of the Lenders and each Agent shall, prior
to disclosure thereof, notify the Borrower of any request for disclosure of any
such non-public information by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of such Lender by such governmental agency) or pursuant to legal
process.
Section 28.4. OTHER. In no event shall any Lender or any Agent be
obligated or required to return any materials furnished to it or any Section 20
Subsidiary by the Borrower or any of its Subsidiaries. The obligations of each
Lender under this Section 28 shall supersede and replace the obligations of such
Lender under any confidentiality letter in respect of this financing signed and
delivered by such Lender to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any interest
in any of the Loans or Reimbursement Obligations from any Lender.
112
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
THE BORROWER:
-------------
REPUBLIC TECHNOLOGIES
INTERNATIONAL, LLC
By:______________________________________
Name:
Title:
000
-0-
XXX XXXXXXXXXX:
---------------
REPUBLIC TECHNOLOGIES
INTERNATIONAL HOLDINGS, LLC
By:______________________________________
Name:
Title:
RTI CAPITAL CORP.
By:______________________________________
Name:
Title:
BLISS & XXXXXXXX, LLC
By:______________________________________
Name:
Title:
114
-3-
CANADIAN DRAWN STEEL COMPANY INC.
By:______________________________________
Name:
Title:
NIMISHILLEN & TUSCARAWAS, LLC
By:______________________________________
Name:
Title:
115
-4-
THE BANKS AND THE AGENTS:
-------------------------
FLEET CAPITAL CORPORATION,
individually and as Administrative Agent
and Co-Book Manager
By:______________________________________
Name:
Title:
000
-0-
XXXX XX XXXXXXX, X.X.,
individually and as Syndication Agent
and Co-Book Manager
By:______________________________________
Name:
Title:
117
-6-
THE CHASE MANHATTAN BANK,
individually and as Documentation Agent
and Co-Book Manager
By:
Name:
Title:
000
-0-
XXXXXXXX XXXXXXX XXXXXXXXXXX
By:______________________________________
Name:
Title:
119
-8-
XXXXXX FINANCIAL, INC.
By:______________________________________
Name:
Title:
120
-9-
CONGRESS FINANCIAL CORPORATION
By:______________________________________
Name:
Title:
121
-10-
THE CIT GROUP / BUSINESS CREDIT, INC.
By:______________________________________
Name:
Title:
122
-11-
LASALLE BUSINESS CREDIT, INC.
By:______________________________________
Name:
Title:
123
-12-
MELLON BANK, N.A.
By:______________________________________
Name:
Title:
124
-13-
DIME COMMERCIAL CORP.
By:______________________________________
Name:
Title:
125
-14-
GUARANTY BUSINESS CREDIT
CORPORATION, doing business as
Fidelity Funding
By:______________________________________
Name:
Title:
126
-15-
ORIX BUSINESS CREDIT, INC.
By:______________________________________
Name:
Title:
000
-00-
XXXXXXX XXXXXXX XXXX.
By:______________________________________
Name:
Title:
000
-00-
XXXXX XXXX XX XXXXXXXXXX, X.X.
By:______________________________________
Name:
Title:
129
-18-
GMAC BUSINESS CREDIT, LLC
By:______________________________________
Name:
Title:
