EXHIBIT 4.24
$600,000,000
CREDIT AGREEMENT
Dated as of August 21, 1996
Among
CROMPTON & XXXXXXX CORPORATION,
CROMPTON & XXXXXXX COLORS INCORPORATED,
XXXXX-STANDARD CORPORATION,
INGREDIENT TECHNOLOGY CORPORATION,
and
UNIROYAL CHEMICAL COMPANY, INC.
as Borrowers
and
THE INITIAL LENDERS, INITIAL ISSUING BANKS AND
SWING LINE BANK NAMED HEREIN
as Initial Lenders, Initial Issuing Banks and Swing Line
Bank
and
CITICORP SECURITIES, INC.
as Arranger
and
CITICORP USA, INC.
as Agent
and
THE CHASE MANHATTAN BANK
as Managing Agent
TABLE OF CONTENTS
Section
Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms 2
1.02. Computation of Time Periods 31
1.03. Accounting Terms 31
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
2.01. The Advances 32
2.02. Making the Advances 35
2.03. Issuance of and Drawings and Reimbursement Under
Letters of Credit 38
2.04. Repayment of Advances 40
2.05. Termination or Reduction of the Commitments 42
2.06. Prepayments 43
2.07. Interest 44
2.08. Fees 45
2.09. Conversion of Advances 46
2.10. Increased Costs, Etc. 47
2.11. Payments and Computations 48
2.12. Taxes 50
2.13. Sharing of Payments, Etc. 53
2.14. Use of Proceeds 53
2.15. Defaulting Lenders 54
ARTICLE III
CONDITIONS OF LENDING
3.01. Conditions Precedent to Initial Extension of Credit 56
3.02. Conditions Precedent to Each Borrowing and Issuance 64
3.03. Determinations Under Section 3.01 65
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrowers 65
ARTICLE V
COVENANTS OF THE BORROWERS
5.01. Affirmative Covenants 71
5.02. Negative Covenants 77
5.03. Reporting Requirements 87
5.04. Financial Covenants 90
ARTICLE VI
EVENTS OF DEFAULT
6.01. Events of Default 92
6.02. Actions in Respect of the Letters of Credit upon
Default 96
6.03. Actions in Respect of Working Capital B-1 Commitments
Reserved Pursuant to Section 2.01(g) 96
ARTICLE VII
THE AGENT
7.01. Authorization and Action 97
7.02. Agent's Reliance, Etc. 97
7.03. Citicorp and Affiliates 98
7.04. Lender Party Credit Decision 98
7.05. Indemnification 98
7.06. Successor Agents 99
ARTICLE VIII
MISCELLANEOUS
8.01. Amendments, Etc. 101
8.02. Notices, Etc. 102
8.03. No Waiver; Remedies 102
8.04. Costs and Expenses 102
8.05. Right of Set-off 104
8.06. Binding Effect 105
8.07. Assignments and Participations 105
8.08. Execution in Counterparts 108
8.09. No Liability of the Issuing Banks 108
8.10. Release of Collateral 109
8.11. Confidentiality 109
8.12. Jurisdiction, Etc. 110
8.13. Governing Law 110
8.14. Waiver of Jury Trial 111
SCHEDULES
Schedule I- Commitments and Applicable Lending Offices
Schedule II-Subsidiary Guarantors
Schedule III-Minor Subsidiaries
Schedule 2.03(e)-Existing Letters of Credit
Schedule 3.01(d)-Surviving Debt
Schedule 3.01(f)-Disclosed Litigation
Schedule 3.01(k)(xx)-Local Counsel
Schedule 4.01(b)-Subsidiaries
Schedule 4.01(d)-Authorizations, Approvals, Actions, Notices and
Filings
Schedule 4.01(o)-Environmental Disclosure
Schedule 4.01(t)-Existing Debt
Schedule 4.01(w)-Material Subsidiaries
Schedule 5.02(a)-Existing Liens
Schedule 5.02(f)-Investments
EXHIBITS
Exhibit A-1-Form of Working Capital A Note
Exhibit A-2-Form of Working Capital B-1 Note
Exhibit A-3-Form of Working Capital B-2 Note
Exhibit B-Form of Notice of Borrowing
Exhibit C-Form of Assignment and Acceptance
Exhibit D-1-Form of Crompton Security Agreement
Exhibit D-2-Form of Uniroyal Security Agreement
Exhibit D-3-Form of Louisiana Undertaking
Exhibit E-1-Form of Parent Guaranty
Exhibit E-2-Form of Subsidiary Guaranty
Exhibit F-1-Form of Opinion of Counsel for the Loan Parties
Exhibit F-2-Form of Opinion of General Counsel to Crompton Corp.
and its Subsidiaries
Exhibit F-3-Form of Opinion of General Counsel to Crompton Corp.
and its Subsidiaries
Exhibit G-Form of Solvency Certificate
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of August 21, 1996 among CROMPTON
& XXXXXXX CORPORATION, a Massachusetts corporation ("Crompton
Corp."), CROMPTON & XXXXXXX COLORS INCORPORATED, a Delaware
corporation ("Crompton Colors"), XXXXX-STANDARD CORPORATION, a
Delaware corporation ("Xxxxx-Standard"), INGREDIENT TECHNOLOGY
CORPORATION, a Delaware corporation ("ITC" and, together with
Crompton Corp., Crompton Colors and Xxxxx-Standard, the "Crompton
Borrowers"), UNIROYAL CHEMICAL COMPANY, INC., a New Jersey
corporation ("Uniroyal" or the "Uniroyal Borrower" and, together
with the Crompton Borrowers, the "Borrowers"), the banks,
financial institutions and other institutional lenders listed on
the signature pages hereof as the Initial Lenders (the "Initial
Lenders"), the Initial Issuing Banks (the "Initial Issuing
Banks") and the Swing Line Bank (as hereinafter defined),
CITICORP SECURITIES, INC., as Arranger (the "Arranger"), CITICORP
USA, INC. ("Citicorp"), as agent (together with any successor
appointed pursuant to Article VII, the "Agent") for the Lender
Parties (as hereinafter defined), and THE CHASE MANHATTAN BANK,
as Managing Agent.
PRELIMINARY STATEMENTS:
(1) Each of Crompton Colors, Xxxxx-Standard and ITC is a
wholly owned Subsidiary (as hereinafter defined) of Crompton
Corp.
(2) Pursuant to the Agreement and Plan of Merger dated as
of April 30, 1996 (as amended, supplemented or otherwise modified
in accordance with its terms, to the extent permitted in
accordance with the Loan Documents (as hereinafter defined), the
"Merger Agreement") between Crompton Corp. and Uniroyal Chemical
Corporation, a Delaware corporation ("Uniroyal Corp."), Crompton
Corp. has agreed to consummate a merger (the "Merger") with
Uniroyal Corp. through Tiger Merger Corp., a Delaware corporation
and a wholly owned Subsidiary of Crompton Corp. in which Uniroyal
Corp. will be the surviving corporation.
(3) The Borrowers have requested that, immediately upon the
consummation of the Merger, the Lender Parties lend to the
Borrowers up to $600,000,000 to pay transaction fees and expenses
incurred in connection with the Merger and that, from time to
time, the Lender Parties lend to the Borrowers and issue Letters
of Credit for the account of the Borrowers to redeem or
repurchase public Debt (as hereinafter defined) of Uniroyal and
Uniroyal Corp. and for other general corporate purposes,
including, without limitation, to finance permitted acquisitions
and Capital Expenditures (as hereinafter defined) and to provide
working capital for the Borrowers and their respective
Subsidiaries. The Lender Parties have indicated their
willingness to agree to lend such amounts on the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties
hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement,
the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Advance" means a Working Capital Advance, a Swing Line Advance
or a Letter of Credit Advance.
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under
common control with such Person or is a director or officer of
such Person. For purposes of this definition, the term "control"
(including the terms "controlling," "controlled by" and "under
common control with") of a Person means the possession, direct or
indirect, of the power to vote 10% or more of the Voting Stock of
such Person or to direct or cause the direction of the management
and policies of such Person, whether through the ownership of
Voting Stock, by contract or otherwise.
"Agent" has the meaning specified in the recital of parties to
this Agreement.
"Agent's Account" means the account of the Agent maintained by
the Agent with Citibank at its office at 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Account No. 3885-8061,
Attention: Xxxxxxxxx Xxxxxxxx.
"Applicable Lending Office" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of
a Base Rate Advance and such Lender Party's Eurodollar Lending
Office in the case of a Eurodollar Rate Advance.
"Applicable Margin" means (a) from the date hereof until December
31, 1996, 0.0% per annum for Base Rate Advances and 0.875% per
annum for Eurodollar Rate Advances and (b) thereafter, a
percentage per annum determined by reference to the Total
Debt/EBITDA Ratio as set forth below:
Total Debt/EBITDA Ratio Base Rate Advances Eurodollar
Rate Advances
Level I
less than or equal to
2.0:1.0 0.0% 0.375%
Level II
greater than 2.0:1.0,
but less than or
equal to 2.5:1.0 0.0% 0.500%
Level III
greater than 2.5:1.0,
but less than or
equal to 3.0:1.0 0.0%
0.625%
Level IV
greater than 3.0:1.0,
but less than or
equal to 3.5:1.0 0.0%
0.750%
Level V
greater than 3.5:1.0,
but less than or
equal to 4.0:1.0 0.0%
0.875%
Level VI
greater than 4.0:1.0 0.0%
1.000%
The Applicable Margin for each Advance shall be determined by
reference to the Total Debt/EBITDA Ratio in effect from time to
time; provided, however, that, at any date of determination of
the Applicable Margin, if the relevant Financial Statements shall
not have been delivered to the Agent and the Lender Parties by
such date and Crompton Corp. shall have delivered to the Agent a
certificate setting forth Crompton Corp.'s good faith estimate of
the Total Debt/EBITDA Ratio for the immediately preceding Rolling
Period, the Applicable Margin shall be determined by reference to
such good faith estimate of the Total Debt/EBITDA Ratio, provided
further that if, upon delivery by Crompton Corp. of such
Financial Statements, such Financial Statements indicate that
such estimate of the Total Debt/EBITDA Ratio was incorrect and,
as a result thereof, the Applicable Margin was too low at such
date of determination, such Applicable Margin shall be increased,
as appropriate, with retroactive effect to the beginning of the
Rolling Period during which such date of determination occurred,
and the applicable Borrower shall immediately pay to the Agent
for the account of the Lender Parties all additional interest due
by reason of such increased Applicable Margin.
"Applicable Percentage" means (a) from the date hereof until
December 31, 1996, 0.25% per annum for commitment fees, 0.625%
per annum for Trade Letter of Credit fees and 0.875% per annum
for Standby Letter of Credit fees and (b) thereafter, a
percentage per annum determined by reference to the Total
Debt/EBITDA Ratio as set forth below:
Total Debt/EBITDA Ratio Commitment Trade Letter Standby Letter
Fees of Credit Fees of Credit Fees
Level I
less than or equal to 2.0:1.0 0.125% 0.125% 0.375%
Level II
greater than 2.0:1.0,
but less than or
equal to 2.5:1.0 0.150% 0.250% 0.500%
Level III
greater than 2.5:1.0,
but less than or
equal to 3.0:1.0 0.175% 0.375% 0.625%
Level IV
greater than 3.0:1.0,
but less than or
equal to 3.5:1.0 0.250% 0.500% 0.750%
Level V
greater than 3.5:1.0,
but less than or
equal to 4.0:1.0 0.250% 0.625% 0.875%
Level VI
greater than 4.0:1.0 0.375% 0.750% 1.000%
The Applicable Percentage shall be determined by reference to the
Total Debt/EBITDA Ratio in effect from time to time; provided,
however, that, at any date of determination of the Applicable
Percentage, if the relevant Financial Statements shall not have
been delivered to the Agent and the Lender Parties by such date
and Crompton Corp. shall have delivered to the Agent a
certificate setting forth Crompton Corp.'s good faith estimate of
the Total Debt/EBITDA Ratio for the immediately preceding Rolling
Period, the Applicable Percentage shall be determined by
reference to such good faith estimate of the Total Debt/EBITDA
Ratio, provided further that if, upon delivery by Crompton Corp.
of such Financial Statements, such Financial Statements indicate
that such estimate of the Total Debt/EBITDA Ratio was incorrect
and, as a result thereof, the Applicable Percentage was too low
at such date of determination, such Applicable Percentage shall
be increased, as appropriate, with retroactive effect to the
beginning of the Rolling Period during which such date of
determination occurred, and the applicable Borrower shall
immediately pay to the Agent for the account of the Lender
Parties all additional fees due by reason of such increased
Applicable Percentage.
"Appropriate Lender" means, at any time, with respect to (a) any
of the Working Capital Facilities, a Lender that has a Commitment
with respect to such Facility at such time, (b) either of the
Letter of Credit Facilities, (i) any Issuing Bank that has a
Commitment with respect to such Facility at such time and (ii) if
other Working Capital Lenders have made Letter of Credit Advances
pursuant to Section 2.03(c) that are outstanding at such time,
each such other Working Capital Lender and (c) either of the
Swing Line Facilities, (i) the Swing Line Bank and (ii) if other
Working Capital Lenders have made Swing Line Advances pursuant to
Section 2.02(b) that are outstanding at such time, each such
other Working Capital Lender.
"Arranger" has the meaning specified in the recital of parties to
this Agreement.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender Party and an Eligible Assignee, and
accepted by the Agent, in accordance with Section 8.07 and in
substantially the form of Exhibit C hereto.
"Available Amount" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of
Credit at such time (assuming compliance at such time with all
conditions to drawing).
"Available Cash Flow" means, for any Fiscal Year, an amount equal
to the sum of (a) Operating Cash Flow for the previous Fiscal
Year, (b) the amount of Capital Expenditures permitted to be made
in the previous Fiscal Year pursuant to Section 5.02(n) less the
amount of Capital Expenditures actually made during the previous
Fiscal Year, (c) the amount of dividends permitted to be paid by
Crompton Corp. in the previous Fiscal Year pursuant to Section
5.02(g) less the amount of such dividends actually paid during
the previous Fiscal Year, (d) the aggregate amount of Net Cash
Proceeds from the sale or other disposition of assets pursuant to
clause (iii) or (vi) (to the extent not used permanently to
prepay Debt or to make Capital Expenditures) of Section 5.02(e)
during the previous Fiscal Year and (e) $100,000,000.
"Bank Hedge Agreement" means any Hedge Agreement required or
permitted under Article V that is entered into by and between any
Borrower and any Hedge Bank.
"Base Rate" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be
equal to the highest of:
(a) the rate of interest announced publicly by Citibank in
New York, New York, from time to time, as Citibank's base rate;
(b) the sum (adjusted to the nearest 1/4 of 1% or, if there is no
nearest 1/4 of 1%, to the next higher 1/4 of 1%) of (i) 1/2 of 1%
per annum, plus (ii) the rate obtained by dividing (A) the latest
three-week moving average of secondary market morning offering
rates in the United States for three-month certificates of
deposit of major United States money market banks, such
three-week moving average (adjusted to the basis of a year of 360
days) being determined weekly on each Monday (or, if such day is
not a Business Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday by Citibank on
the basis of such rates reported by certificate of deposit
dealers to and published by the Federal Reserve Bank of New York
or, if such publication shall be suspended or terminated, on the
basis of quotations for such rates received by Citibank from
three New York certificate of deposit dealers of recognized
standing selected by Citibank, by (B) a percentage equal to 100%
minus the average of the daily percentages specified during such
three-week period by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, but not limited to, any
emergency, supplemental or other marginal reserve requirement)
for Citibank with respect to liabilities consisting of or
including (among other liabilities) three-month U.S. dollar
non-personal time deposits in the United States, plus (iii) the
average during such three-week period of the annual assessment
rates estimated by Citibank for determining the then current
annual assessment payable by Citibank to the Federal Deposit
Insurance Corporation (or any successor) for insuring U.S. dollar
deposits of Citibank in the United States; and
(c) 1/2 of one percent per annum above the Federal Funds Rate.
"Base Rate Advance" means an Advance that bears interest as
provided in Section2.07(a)(i).
"Borrower's Account" means, with respect to any Borrower, the
account of such Borrower maintained by such Borrower with
Citibank at its office at 000 Xxxx Xxxxxx, XxxXxxx, XxxXxxx
00000, which account is, in the case of Crompton Color, Account
No. 4070-6438, in the case of Crompton Corp., Account No. 4070-6411,
in the case of Xxxxx-Standard, Account No. 4070-6462, in
the case of ITC, Account No. 4070-6446, and in the case of
Uniroyal, Account No. 4049-8376.
"Borrowers" has the meaning specified in the recital of parties
to this Agreement.
"Borrowing" means a Working Capital Borrowing or a Swing Line
Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if
the applicable Business Day relates to any Eurodollar Rate
Advances, on which dealings are carried on in the London
interbank market.
"Capital Expenditures" means, for any Person for any period and
without duplication, the sum of (a) all expenditures (including,
without limitation, expenditures for environmental remediation)
made, directly or indirectly, by such Person during such period
for equipment, fixed or capital assets, real property or
improvements, or for replacements or substitutions therefor or
additions thereto, that have been or should be, in accordance
with GAAP, reflected as additions to property, plant or equipment
on a Consolidated balance sheet of such Person plus (b) the
aggregate principal amount of all Debt (including Obligations
under Capitalized Leases) assumed or incurred in connection with
any such expenditures but excluding (x) expenditures made in
connection with the replacement or restoration of assets, to the
extent such replacement or restoration is financed out of
insurance proceeds paid on account of the loss of or damage to
the assets so replaced or restored and (y) interest capitalized
during construction; provided, however, that notwithstanding
anything contained herein, Capital Expenditures shall not include
any Investments.
"Capitalized Leases" means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases.
"Cash Equivalents" means any of the following, to the extent
owned by any Borrower or any of its Subsidiaries free and clear
of all Liens and having a maturity of not greater than 90 days
from the date of acquisition thereof: (a) readily marketable
direct obligations of the Government of the United States or any
agency or instrumentality thereof or obligations unconditionally
guaranteed by the full faith and credit of the Government of the
United States, (b) insured certificates of deposit of or time
deposits with any commercial bank that is a Lender Party or a
member of the Federal Reserve System, issues (or the parent of
which issues) commercial paper rated as described in clause(c),
is organized under the laws of the United States or any State
thereof and has combined capital and surplus of at least $1
billion or (c)commercial paper in an aggregate amount of no more
than $5,000,000 per issuer outstanding at any time, issued by any
corporation organized under the laws of any State of the United
States and rated at least "Prime-1" (or the then equivalent
grade) by Xxxxx'x or "A-1" (or the then equivalent grade) by S&P.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to
time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the
U.S. Environmental Protection Agency.
"Citibank" means Citibank, N.A.
"Citibank Seoul" means Citibank, N.A., Seoul Branch.
"Citicorp" has the meaning specified in the recital of parties to
this Agreement.
"Collateral" means all "Collateral" referred to in the Collateral
Documents and all other property that is or is intended to be
subject to any Lien in favor of the Agent for the benefit of the
Secured Parties.
"Collateral Documents" means the Security Agreement, the
Louisiana Undertaking, the Blocked Account Letters (as defined in
the Uniroyal Security Agreement) and any other agreement that
creates or purports to create a Lien in favor of the Agent for
the benefit of the Secured Parties.
"Collateral Release Date" means the earliest of (a) the latest of
(i) the Termination Date, (ii) the payment in full of the
Obligations of the Loan Parties under the Loan Documents (other
than any indemnities) and (iii) the termination or expiration of
all Bank Hedge Agreements, (b) the date on which the Agent
receives evidence satisfactory to it that a Debt Rating of
(i) BBB- or above from S&P and Ba1 or above from Xxxxx'x or (ii)
Baa3 or above from Xxxxx'x and BB+ or above from S&P, in either
case shall have been in effect continuously for three months and
is then in effect, provided that Crompton Corp. shall not have
been placed on "credit watch" with negative implications (or any
like designation by S&P or Xxxxx'x from time to time) by either
S&P or Xxxxx'x during such three-month period, and (c) the date
on which the Agent receives evidence satisfactory to it that the
Total Debt/EBITDA Ratio for the two Rolling Periods then most
recently ended shall be less than or equal to 3.0:1.0 and the
Interest Coverage Ratio for the two Rolling Periods then most
recently ended shall be greater than or equal to 3.0:1.0,
provided that in any event no Default shall have occurred and
shall be continuing on such date.
"Commitment" means a Working Capital A Commitment, a Working
Capital B-1 Commitment, a Working Capital B-2 Commitment or a
Letter of Credit Commitment.
"Confidential Information" means information that any Borrower
furnishes to the Agent or any Lender Party in a writing
designated as confidential but does not include any such
information that is or becomes generally available to the public
other than as a result of a breach by the Agent or any Lender
Party of its obligations hereunder or that is or becomes
available to the Agent or such Lender Party from a source other
than a Borrower that is not, to the best of the Agent's or such
Lender Party's knowledge, acting in violation of a
confidentiality agreement with any Borrower.
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Conversion", "Convert" and "Converted" each refer to a
conversion of Advances of one Type into Advances of the other
Type pursuant to Section 2.09 or 2.10.
"Crompton Borrowers" has the meaning specified in the recital of
parties to this Agreement.
"Crompton Colors" has the meaning specified in the recital of
parties to this Agreement.
"Crompton Corp." has the meaning specified in the recital of
parties to this Agreement.
"Crompton Guarantors" means the Subsidiaries of Crompton Corp.
listed on Part I of Schedule II hereto and each other Subsidiary
of Crompton Corp. (other than, in any event, Uniroyal Corp. and
its Subsidiaries) that shall be required to execute and deliver a
guaranty pursuant to Section 5.01(k) or 5.01(l)(v).
"Crompton Security Agreement" has the meaning specified in
Section 3.01(k)(vii).
"Xxxxx-Standard" has the meaning specified in the recital of
parties to this Agreement.
"Daylight Overdraft Bank" means Citibank.
"Daylight Overdraft Documents" means those documents and
agreements entered into from time to time by the Daylight
Overdraft Bank and any Loan Party, evidencing or relating to the
Debt referred to in Section 5.02(b)(iii)(F).
"Debt" of any Person means, without duplication, (a)all
indebtedness of such person for borrowed money, (b)all
Obligations of such Person for the deferred purchase price of
property or services (other than trade payables not overdue by
more than 60 days (unless the subject of a bona fide dispute)
incurred in the ordinary course of such Person's business),
(c)all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d)all Obligations of
such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired
by such Person (even though the rights and remedies of the seller
or lender under such agreement in the event of default are
limited to repossession or sale of such property), (e)all
Obligations of such Person as lessee under Capitalized Leases,
(f)all Obligations, contingent or otherwise, of such Person under
acceptance, letter of credit or similar facilities, (g)all
Obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any capital stock of
or other ownership or profit interest in such Person or any other
Person or any warrants, rights or options to acquire such capital
stock, valued, in the case of redeemable preferred stock, at the
greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends, (h)all Obligations of such
Person in respect of Hedge Agreements, (i)all Debt of others
referred to in clauses(a) through (h) above or clause (j) below
guaranteed directly or indirectly in any manner by such Person,
or in effect guaranteed directly or indirectly by such Person
through an agreement (i)to pay or purchase such Debt or to
advance or supply funds for the payment or purchase of such Debt,
(ii)to purchase, sell or lease (as lessee or lessor) property, or
to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such Debt or to assure the
holder of such Debt against loss, (iii)to supply funds to or in
any other manner invest in the debtor (including any agreement to
pay for property or services irrespective of whether such
property is received or such services are rendered) or
(iv)otherwise to assure a creditor against loss, and (j)all Debt
referred to in clauses(a) through (i) above of another Person
secured by (or for which the holder of such Debt has an existing
right, contingent or otherwise, to be secured by) any Lien on
property (including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Debt.
"Debt Rating" means, as of any date, the lowest rating that has
been most recently announced by either S&P or Xxxxx'x, as the
case may be, for any class of non-credit enhanced long-term
senior unsecured debt issued by Crompton Corp. or, if applicable,
the rating assigned in writing by either S&P or Xxxxx'x, as the
case may be, as the "implied rating" of Crompton Corp.'s non-credit
enhanced long-term senior unsecured Debt, provided that
for purposes of the foregoing, if S&P or Xxxxx'x shall change the
basis on which ratings are established, each reference to the
Debt Rating announced by S&P or Xxxxx'x, as the case may be,
shall refer to the then equivalent rating by S&P or Xxxxx'x, as
the case may be.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that
notice be given or time elapse or both.
"Defaulted Advance" means, with respect to any Lender Party at
any time, the portion of any Advance required to be made by such
Lender Party to any Borrower pursuant to Section2.01 or 2.02 at
or prior to such time which has not been made by such Lender
Party or the Agent for the account of such Lender Party pursuant
to Section 2.02(e) as of such time. In the event that a portion
of a Defaulted Advance shall be deemed made pursuant to
Section2.15(a), the remaining portion of such Defaulted Advance
shall be considered a Defaulted Advance originally required to be
made pursuant to Section 2.01 on the same date as the Defaulted
Advance so deemed made in part.
"Defaulted Amount" means, with respect to any Lender Party at any
time, any amount required to be paid by such Lender Party to the
Agent or any other Lender Party hereunder or under any other Loan
Document at or prior to such time which has not been so paid as
of such time, including, without limitation, any amount required
to be paid by such Lender Party to (a) the Swing Line Bank
pursuant to Section 2.02(b) to purchase a portion of a Swing Line
Advance made by the Swing Line Bank, (b) any Issuing Bank
pursuant to Section 2.03(c) to purchase a portion of a Letter of
Credit Advance made by such Issuing Bank, (c) the Agent pursuant
to Section 2.02(e) to reimburse the Agent for the amount of any
Advance made by the Agent for the account of such Lender Party,
(d)any other Lender Party pursuant to Section 2.13 to purchase
any participation in Advances owing to such other Lender Party
and (e)the Agent or any Issuing Bank pursuant to Section 7.05 to
reimburse the Agent or such Issuing Bank for such Lender Party's
ratable share of any amount required to be paid by the Lender
Parties to the Agent or such Issuing Bank as provided therein.
In the event that a portion of a Defaulted Amount shall be deemed
paid pursuant to Section 2.15(b), the remaining portion of such
Defaulted Amount shall be considered a Defaulted Amount
originally required to be paid hereunder or under any other Loan
Document on the same date as the Defaulted Amount so deemed paid
in part.
"Defaulting Lender" means, at any time, any Lender Party that, at
such time, (a)owes a Defaulted Advance or a Defaulted Amount or
(b)shall take any action or be the subject of any action or
proceeding of a type described in Section 6.01(f).
"Disclosed Litigation" has the meaning specified in
Section 3.01(f).
"Domestic Lending Office" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender
Party, as the case may be, or such other office of such Lender
Party as such Lender Party may from time to time specify to
Crompton Corp. and the Agent.
"Domestic Subsidiary" of Crompton Corp. means any Subsidiary of
Crompton Corp. other than a Foreign Subsidiary.
"EBITDA" means, for any period, net income (or net loss)
calculated before the cumulative effect of accounting changes
plus the sum of (a) interest expense, (b) income tax expense, (c)
extraordinary losses included in net income, (d)depreciation
expense, (e)amortization expense, (f)all foreign currency losses
less foreign currency gains (but only to the extent such foreign
currency gains do not exceed such foreign currency losses), (g)
non-recurring expenses incurred in connection with the Merger in
an amount not to exceed $70,000,000 in the aggregate and (h) non-recurring
restructuring charges in an amount not to exceed
$20,000,000 in any Fiscal Year or $50,000,000 in the aggregate
after the Effective Date less extraordinary gains included in net
income, determined on a Consolidated basis in accordance with
GAAP for such period.
"Effective Date" means the first date on which the conditions set
forth in Article III are satisfied.
"Eligible Assignee" means (a) with respect to any Facility (other
than the Letter of Credit Facilities), (i)a Lender; (ii) an
Affiliate of a Lender; and (iii)any other Person approved by the
Agent and Crompton Corp., such approval not to be unreasonably
withheld or delayed, and (b)with respect to the Letter of Credit
Facilities, any Person approved by the Agent and Crompton Corp.,
such approval not to be unreasonably withheld or delayed;
provided, however, that neither any Loan Party nor any Affiliate
of a Loan Party shall qualify as an Eligible Assignee under this
definition.
"Environmental Action" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding,
consent order or consent agreement relating in any way to any
Environmental Law, any Environmental Permit or Hazardous Material
or arising from alleged injury or threat to health, safety or the
environment, including, without limitation, (a)by any
governmental or regulatory authority for enforcement, cleanup,
removal, response, remedial or other actions or damages and (b)by
any governmental or regulatory authority or third party for
damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.
"Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ,
judgment, injunction, decree or judicial or agency
interpretation, policy or guidance relating to pollution or
protection of the environment, health, safety or natural
resources, including, without limitation, those relating to the
use, handling, transportation, treatment, storage, disposal,
release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any
Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations
promulgated and rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV
of ERISA is a member of the controlled group of any Loan Party,
or under common control with any Loan Party, within the meaning
of Section 414 of the Internal Revenue Code.
"ERISA Event" means (a) (i)the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such
event has been waived by the PBGC, or (ii) the requirements of
subsection (1) of Section 4043(b) of ERISA (without regard to
subsection (2) of such Section) are met with respect to a
contributing sponsor, as defined in Section 4001(a)(13) of ERISA,
of a Plan, and an event described in paragraph (9), (10), (11),
(12) or (13) of Section 4043(c) of ERISA is reasonably expected
to occur with respect to such Plan within the following 30 days;
(b) the application for a minimum funding waiver with respect to
a Plan; (c)the provision by the administrator of any Plan of a
notice of intent to terminate such Plan, pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a
plan amendment referred to in Section 4041(e) of ERISA); (d) the
cessation of operations at a facility of any Loan Party or any
ERISA Affiliate in the circumstances described in Section 4062(e)
of ERISA; (e)the withdrawal by any Loan Party or any ERISA
Affiliate from a Multiple Employer Plan during a plan year for
which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (f)the conditions for imposition of a lien
under Section 302(f) of ERISA shall have been met with respect to
any Plan; (g)the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of
ERISA; or (h)the institution by the PBGC of proceedings to
terminate a Plan pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042 of
ERISA that constitutes grounds for the termination of, or the
appointment of a trustee to administer, such Plan.
"Eurocurrency Liabilities" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to any Lender
Party, the Office of such Lender Party specified as its
"Eurodollar Lending Office" opposite its name on Schedule I
hereto or in the Assignment and Acceptance pursuant to which it
became a Lender Party (or, if no such office is specified, its
Domestic Lending Office), or such other office of such Lender
Party as such Lender Party may from time to time specify to
Crompton Corp. and the Agent.
"Eurodollar Rate" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing,
an interest rate per annum equal to the rate per annum obtained
by dividing (a)the rate per annum at which deposits in U.S.
dollars are offered by the principal office of Citibank in
London, England to prime banks in the London interbank market at
11:00 A.M. (London time) two Business Days before the first day
of such Interest Period in an amount substantially equal to
Citibank's Eurodollar Rate Advance comprising part of such
Borrowing to be outstanding during such Interest Period (or, if
Citibank shall not have such a Eurodollar Rate Advance,
$1,000,000) and for a period equal to such Interest Period by
(b)a percentage equal to 100% minus the Eurodollar Rate Reserve
Percentage for such Interest Period.
"Eurodollar Rate Advance" means an Advance that bears interest as
provided in Section2.07(a)(ii).
"Eurodollar Rate Reserve Percentage" for any Interest Period for
all Eurodollar Rate Advances comprising part of the same
Borrowing means the reserve percentage applicable two Business
Days before the first day of such Interest Period under
regulations issued from time to time by the Board of Governors of
the Federal Reserve System (or any successor) for determining the
maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement)
for a member bank of the Federal Reserve System in New York City
with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities (or with respect to any other category
of liabilities that includes deposits by reference to which the
interest rate on Eurodollar Rate Advances is determined) having a
term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Existing Debt" means Debt of the Borrowers and their respective
Subsidiaries outstanding immediately before giving effect to the
Merger.
"Existing Letters of Credit" has the meaning specified in Section
2.03(e).
"Facility" means any of any Working Capital Facility, either
Swing Line Facility or either Letter of Credit Facility.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average of
the quotations for such day for such transactions received by the
Agent from three Federal funds brokers of recognized standing
selected by it.
"Financial Statements" means, at any time, the most recent
financial statements furnished or required to be furnished by
Crompton Corp. to the Agent and the Lender Parties pursuant to
Section 5.03(b) or (c), as the case may be.
"Fiscal Year" means a fiscal year of Crompton Corp. and its
Consolidated Subsidiaries ending on or about December 31 in any
calendar year.
"Foreign Exchange Agreements" means currency swap agreements,
currency future or option contracts and other similar agreements
other than contracts or agreements under which neither any Loan
Party nor any of its Subsidiaries has any obligation that may
require payment in the future.
"Foreign Subsidiary" of Crompton Corp. means (a) solely for
purposes of Section 5.02(a), (b), (d), (e) and (f), Uniroyal
Chemical International Company, Xxxxxxxxx International Company
and Uniroyal Chemical Company Limited and (b) in all instances,
any Subsidiary of Crompton Corp. (i) which is not incorporated in
the United States and (ii)(A) substantially all of whose assets
and properties are located, or substantially all of whose
business is carried on, outside of the United States or (B)
substantially all of whose assets consist of Subsidiaries that
are Foreign Subsidiaries as defined in clauses (i) and (ii)(A) of
this definition.
"GAAP" has the meaning specified in Section 1.03.
"Guaranties" means the Parent Guaranty, the Subsidiary Guaranty
and any other guaranty delivered pursuant to Section 5.01(k) or
5.01(l)(v).
"Guarantors" means Crompton Corp. and the Subsidiary Guarantors.
"Hazardous Materials" means (a)petroleum or petroleum products,
by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and
radon gas and (b)any other chemicals, materials or substances
designated, classified or regulated as hazardous or toxic or as a
pollutant or contaminant under any Environmental Law.
"Hedge Agreements" means, collectively, Interest Rate Swap
Agreements, Foreign Exchange Agreements and agreements designed
to manage the total cost of publicly traded Debt obligations of
the Borrowers.
"Hedge Bank" means any Lender Party or any of its Affiliates in
its capacity as a party to a Bank Hedge Agreement.
"Indemnified Party" has the meaning specified in Section 8.04(b).
"Information Memorandum" means the information memorandum dated
June 1996 used by the Arranger in connection with the syndication
of the Commitments.
"Initial Extension of Credit" means the earlier to occur of the
initial Borrowing and the initial issuance of a Letter of Credit
hereunder.
"Initial Issuing Banks" has the meaning specified in the recital
of parties to this Agreement.
"Initial Lenders" has the meaning specified in the recital of
parties to this Agreement.
"Insufficiency" means, with respect to any Plan, the amount, if
any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
"Interest Coverage Ratio" means, at any date of determination,
the ratio of Consolidated EBITDA to interest payable on, and
amortization of debt discount in respect of, all Debt (including,
without limitation, the interest component of Capitalized
Leases), in each case of Crompton Corp. and its Subsidiaries for
the immediately preceding Rolling Period.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on
the date of such Eurodollar Rate Advance or the date of the
Conversion of any Base Rate Advance into such Eurodollar Rate
Advance, and ending on the last day of the period selected by the
Borrower requesting such Borrowing or Conversion pursuant to the
provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest
Period and ending on the last day of the period selected by such
Borrower pursuant to the provisions below. The duration of each
such Interest Period shall be one, two, three or six months, as
such Borrower may, upon notice received by the Agent not later
than 11:00 A.M. (New York City time) on the third Business Day
prior to the first day of such Interest Period, select; provided,
however, that:
(a)such Borrower may not select any Interest Period with respect
to any Eurodollar Rate Advance under a Facility that ends after
any principal repayment installment date for such Facility
unless, after giving effect to such selection, the aggregate
principal amount of Base Rate Advances and of Eurodollar Rate
Advances having Interest Periods that end on or prior to such
principal repayment installment date for such Facility shall be
at least equal to the aggregate principal amount of Advances
under such Facility due and payable on or prior to such date;
(b)Interest Periods commencing on the same date for Eurodollar
Rate Advances comprising part of the same Borrowing shall be of
the same duration;
(c)whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day, provided, however, that, if such extension would
cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period
shall occur on the next preceding Business Day; and
(d)whenever the first day of any Interest Period occurs on a day
of an initial calendar month for which there is no numerically
corresponding day in the calendar month that succeeds such
initial calendar month by the number of months equal to the
number of months in such Interest Period, such Interest Period
shall end on the last Business Day of such succeeding calendar
month.
"Interest Rate Swap Agreements" means interest rate swap, cap or
collar agreements, interest rate future or option contracts and
other similar agreements other than contracts or agreements under
which neither any Loan Party nor any of its Subsidiaries has any
obligation that may require payment in the future.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Inventory" has the meaning specified in Section 1 of the
Uniroyal Security Agreement.
"Investment" in any Person means any loan or advance to such
Person, any purchase or other acquisition of all or substantially
all of the assets of any business of such Person or any capital
stock or other ownership or profit interest, warrants, rights,
options, obligations or other securities of such Person, any
capital contribution to such Person or any other investment in
such Person, including, without limitation, any arrangement
pursuant to which the investor incurs Debt of the types referred
to in clause (i) or (j) of the definition of "Debt" in respect of
such Person.
"Issuing Banks" means (a) with respect to the Letter of Credit A
Facility, each Initial Issuing Bank that has a Letter of Credit A
Commitment set forth opposite its name on Schedule I hereto and
any other Working Capital A Lender approved as an Issuing Bank by
the Agent and, so long as no Default shall have occurred and be
continuing, by Crompton Corp. (such approval not to be
unreasonably withheld or delayed) and each Eligible Assignee to
which a Letter of Credit A Commitment hereunder has been assigned
pursuant to Section 8.07 and (b) with respect to the Letter of
Credit B-1 Facility, each Initial Issuing Bank that has a Letter
of Credit B-1 Commitment set forth opposite its name on Schedule
I hereto and any other Working Capital B-1 Lender approved as an
Issuing Bank by the Agent and, so long as no Default shall have
occurred and be continuing, by Crompton Corp. (such approval not
to be unreasonably withheld or delayed) and each Eligible
Assignee to which a Letter of Credit B-1 Commitment hereunder has
been assigned pursuant to Section 8.07 so long as, in each case,
each such Lender or Eligible Assignee expressly agrees to perform
in accordance with their terms all of the obligations that by the
terms of this Agreement are required to be performed by it as an
Issuing Bank and notifies the Agent of its Applicable Lending
Office and the amount of its Letter of Credit Commitment (which
information shall be recorded by the Agent in the Register).
"ITC" has the meaning specified in the recital of parties to this
Agreement.
"L/C Cash Collateral Account" has the meaning specified in the
Security Agreement.
"L/C Related Documents" has the meaning specified in
Section 2.04(e)(ii).
"Lender Party" means any Lender, any Issuing Bank or the Swing
Line Bank.
"Lenders" means the Initial Lenders and each Person that shall
become a Lender hereunder pursuant to Section 8.07.
"Letter of Credit" has the meaning specified in Section 2.01(f).
"Letter of Credit A Commitment" means, with respect to any
Issuing Bank at any time, the amount set forth opposite such
Issuing Bank's name on Schedule I hereto under the caption
"Letter of Credit A Commitment" or, if such Issuing Bank has
entered into one or more Assignments and Acceptances, set forth
for such Issuing Bank in the Register maintained by the Agent
pursuant to Section 8.07(d) as such Issuing Bank's "Letter of
Credit A Commitment", as such amount may be reduced at or prior
to such time pursuant to Section 2.05.
"Letter of Credit A Facility" means, at any time, an amount equal
to the lesser of (a) the aggregate amount of the Issuing Banks'
Letter of Credit A Commitments at such time and (b) $50,000,000,
as such amount may be reduced at or prior to such time pursuant
to Section 2.05.
"Letter of Credit Advance" means an advance made by any Issuing
Bank or any Appropriate Lender pursuant to Section 2.03(c).
"Letter of Credit Agreement" has the meaning specified in Section
2.03(a).
"Letter of Credit B-1 Commitment" means, with respect to any
Issuing Bank at any time, the amount set forth opposite such
Issuing Bank's name on Schedule I hereto under the caption
"Letter of Credit B-1 Commitment" or, if such Issuing Bank has
entered into one or more Assignments and Acceptances, set forth
for such Issuing Bank in the Register maintained by the Agent
pursuant to Section 8.07(d) as such Issuing Bank's "Letter of
Credit B-1 Commitment", as such amount may be reduced at or prior
to such time pursuant to Section 2.05.
"Letter of Credit B-1 Facility" means, at any time, an amount
equal to the lesser of (a) the aggregate amount of the Issuing
Banks' Letter of Credit B-1 Commitments at such time and (b)
$20,000,000, as such amount may be reduced at or prior to such
time pursuant to Section 2.05.
"Letter of Credit Commitment" means a Letter of Credit A
Commitment or a Letter of Credit B-1 Commitment.
"Letter of Credit Facility" means the Letter of Credit A Facility
or the Letter of Credit B-1 Facility.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential
arrangement, including, without limitation, the lien or retained
security title of a conditional vendor and any easement, right of
way or other encumbrance on title to real property.
"Loan Documents" means (a) for purposes of this Agreement and the
Notes and any amendment, supplement or modification hereof or
thereof and for all other purposes other than for purposes of the
Guaranties and the Collateral Documents, (i) this Agreement, (ii)
the Notes, (iii) the Guaranties, (iv) the Collateral Documents
and (v) each Letter of Credit Agreement and (b) for purposes of
the Guaranties and the Collateral Documents, (i) this Agreement,
(ii) the Notes, (iii) the Guaranties, (iv) the Collateral
Documents, (v) each Letter of Credit Agreement, (vi) each Bank
Hedge Agreement and (vii) the Daylight Overdraft Documents, in
each case as amended, supplemented or otherwise modified from
time to time.
"Loan Parties" means the Borrowers and the Guarantors.
"Louisiana Undertaking" has the meaning specified in Section
3.01(k)(xiv).
"Margin Stock" has the meaning specified in Regulation U.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance, properties or prospects of (a) Crompton Corp. and
its Subsidiaries, taken as a whole, (b) Crompton Corp. and its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries),
taken as a whole, or (c) Uniroyal and its Subsidiaries, taken as
a whole.
"Material Adverse Effect" means a material adverse effect on
(a)the business, condition (financial or otherwise), operations,
performance, properties or prospects of (i) Crompton Corp. and
its Subsidiaries, taken as a whole, (ii) Crompton Corp. and its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries),
taken as a whole, or (iii) Uniroyal and its Subsidiaries, taken
as a whole, (b)the rights and remedies of the Agent or any Lender
Party under any Loan Document or Related Document or (c)the
ability of any Loan Party to perform its Obligations under any
Loan Document or Related Document to which it is or is to be a
party.
"Material Subsidiary" means, at any time, a Subsidiary of
Crompton Corp. having at least $10,000,000 in assets on a
Consolidated basis (determined as of the last day of the most
recent fiscal quarter of Crompton Corp.) or at least $20,000,000
in revenues, on a Consolidated basis, for the 12-month period
ending on the last day of the most recent fiscal quarter of
Crompton Corp.; provided, however, that any Subsidiary formed or
acquired after the last day of the most recent fiscal quarter of
Crompton Corp. that would have been a Material Subsidiary if it
had been formed or acquired on or prior to the last day of such
fiscal quarter shall be a Material Subsidiary for purposes hereof
from and after the date of its formation or acquisition.
"Merger" has the meaning specified in the Preliminary Statements.
"Merger Agreement" has the meaning specified in the Preliminary
Statements.
"Minor Subsidiaries" means those Subsidiaries of Crompton Corp.
listed on Schedule III hereto.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make
contributions, or has within any of the preceding five plan years
made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (a)is maintained for
employees of any Loan Party or any ERISA Affiliate and at least
one Person other than the Loan Parties and the ERISA Affiliates
or (b) was so maintained and in respect of which any Loan Party
or any ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be
terminated.
"Naugatuck" means Naugatuck Treatment Company, a Connecticut
corporation.
"Net Cash Proceeds" means, with respect to any sale, lease,
transfer or other disposition of any asset or the sale or
issuance of any Debt or capital stock or other ownership or
profit interest, any securities convertible into or exchangeable
for capital stock or other ownership or profit interest or any
warrants, rights, options or other securities to acquire capital
stock or other ownership or profit interest by any Person, the
aggregate amount of cash received from time to time (whether as
initial consideration or through payment or disposition of
deferred consideration) by or on behalf of such Person in
connection with such transaction after deducting therefrom only
(without duplication) (a)reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees,
finder's fees and other similar fees and commissions and (b)the
amount of taxes payable in connection with or as a result of such
transaction, in each case to the extent, but only to the extent,
that the amounts so deducted are, at the time of receipt of such
cash, actually paid to a Person that is not an Affiliate of such
Person or any Loan Party or any Affiliate of any Loan Party and
are properly attributable to such transaction or to the asset
that is the subject thereof; provided, however, that in the case
of taxes that are deductible under clause (b) but for the fact
that at the time of receipt of such cash, such taxes have not
been actually paid or are not then payable, such Person may
deduct an amount equal to the amount reserved in accordance with
GAAP for such Person's reasonable estimate of such taxes, other
than taxes for which such Person is indemnified; provided
further, however, that if the amount deducted pursuant to clause
(b) above is greater than the amount actually so paid, the amount
of such excess shall constitute Net Cash Proceeds.
"Note" means a Working Capital A Note, a Working Capital B-1 Note
or a Working Capital B-2 Note.
"Notice of Borrowing" has the meaning specified in Section
2.02(a).
"Notice of Issuance" has the meaning specified in
Section 2.03(a).
"Notice of Swing Line Borrowing" has the meaning specified in
Section 2.02(b).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind,
including, without limitation, any liability of such Person on
any claim, whether or not the right of any creditor to payment in
respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed,
legal, equitable, secured or unsecured, and whether or not such
claim is discharged, stayed or otherwise affected by any
proceeding referred to in Section6.01(f). Without limiting the
generality of the foregoing, the Obligations of each Loan Party
under the Loan Documents include (a)the obligation to pay
principal, interest, Letter of Credit commissions, charges,
expenses, fees, attorneys' fees and disbursements, indemnities
and other amounts payable by such Loan Party under any Loan
Document and (b)the obligation of such Loan Party to reimburse
any amount in respect of any of the foregoing that any Lender
Party, in its sole discretion, may elect to pay or advance on
behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"Operating Cash Flow" means, for any Fiscal Year, an amount equal
to "cash flow from operations" for such Fiscal Year as set forth
on the statement of cash flows furnished for such Fiscal Year
pursuant to Section 5.03(c) less scheduled principal amounts of
Debt paid or to be paid (other than in connection with the
refinancing or replacement of any Surviving Debt) by Crompton
Corp. and its Subsidiaries during such Fiscal Year.
"Other Taxes" has the meaning specified in Section 2.12(b).
"Parent Guaranty" has the meaning specified in Section
3.01(k)(ix).
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor agency or entity performing substantially the same
functions.
"Permitted Liens" has the meaning specified in Section
5.02(a)(ii).
"Person" means an individual, partnership, corporation (including
a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or
other entity, or a government or any political subdivision or
agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pledged Debt" has the meaning specified in the Security
Agreement.
"Pro Rata Share" of any amount means (a) with respect to any
Working Capital A Lender at any time, the product of such amount
times a fraction the numerator of which is the amount of such
Lender's Working Capital A Commitment at such time and the
denominator of which is the Working Capital A Facility at such
time, (b) with respect to any Working Capital B-1 Lender at any
time, the product of such amount times a fraction the numerator
of which is the amount of such Lender's Working Capital B-1
Commitment at such time and the denominator of which is the
Working Capital B-1 Facility and (c) with respect to any Working
Capital B-2 Lender at any time, the product of such amount times
a fraction the numerator of which is the amount of such Lender's
Working Capital B-2 Commitment at such time and the denominator
of which is the Working Capital B-2 Facility.
"Receivables" has the meaning specified in Section 1 of the
Uniroyal Security Agreement.
"Receivables Securitization" has the meaning specified in Section
5.02(e).
"Register" has the meaning specified in Section 8.07(d).
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Related Documents" means the Merger Agreement, the Uniroyal
Indentures, the Uniroyal Senior Notes, the Uniroyal Corp. Senior
Notes, the Uniroyal Corp. Senior Subordinated Notes and the
Uniroyal Corp. Subordinated Discount Notes and the Tax Agreement.
"Required Lenders" means at any time Lenders owed or holding at
least 51% of the sum of the aggregate Working Capital A
Commitments, Working Capital B-1 Commitments and Working Capital
B-2 Commitments at such time, or, if the Working Capital A
Commitments, Working Capital B-1 Commitments and Working Capital
B-2 Commitments have been terminated, 51% of the sum of the
aggregate outstanding Working Capital A Advances, Working Capital
B-1 Advances and Working Capital B-2 Advances at such time;
provided, however, that if any Lender shall be a Defaulting
Lender at such time, there shall be excluded from the
determination of Required Lenders at such time the aggregate
amount of the Working Capital A Commitment, Working Capital B-1
Commitment and Working Capital B-2 Commitment of such Lender at
such time.
"Responsible Officer" means any officer of any Loan Party or any
of its Subsidiaries.
"Rolling Period" means, with respect to any fiscal quarter of
Crompton Corp. and its Subsidiaries, such fiscal quarter and the
three consecutive immediately preceding fiscal quarters.
"S&P" means Standard & Poor's Rating Group, a division of The
XxXxxx-Xxxx Companies.
"Secured Parties" means the Agent, the Lender Parties, the Hedge
Banks and the Daylight Overdraft Bank.
"Security Agreement" has the meaning specified in Section
3.01(k)(viii).
"Seoul Guaranty" means the guaranty made by the Uniroyal Borrower
in favor of Citibank Seoul, which has issued bank guaranties of
the obligations of Unikor Chemical Inc. (Korea), a joint venture
50% owned by the Uniroyal Borrower, to certain banks organized
and located in Korea.
"Seoul Guaranty Amount" means a fluctuating dollar amount equal
to the amount of the Uniroyal Borrower's obligations under the
Seoul Guaranty, not to exceed $2,000,000 or such other amount
(not to exceed, in any event, $5,000,000) as agreed from time to
time by Citibank, the Uniroyal Borrower and the Agent.
"Single Employer Plan" means a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person
other than the Loan Parties and the ERISA Affiliates or (b)was so
maintained and in respect of which any Loan Party or any ERISA
Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"Solvent" and "Solvency" mean, with respect to any Person on a
particular date, that on such date (a)the fair value of the
property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent
liabilities, of such Person, (b)the present fair salable value of
the assets of such Person is not less than the amount that will
be required to pay the probable liability of such Person on its
debts as they become absolute and matured, (c)such Person does
not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay such debts and
liabilities as they mature and (d)such Person is not engaged in
business or a transaction, and is not about to engage in business
or a transaction, for which such Person's property would
constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the
amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
"Specified Amount" means the aggregate amount of the Working
Capital B-2 Commitments on the "Change of Control Purchase Date"
(as defined in the Uniroyal Indentures), after giving effect to
any reduction of such Commitments on or prior to such date
pursuant to Section 2.05(a).
"Standby Letter of Credit" means any Letter of Credit issued
under either Letter of Credit Facility, other than a Trade Letter
of Credit.
"Subsidiary" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of
which (or in which) more than 50% of (a)the issued and
outstanding capital stock having ordinary voting power to elect a
majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting
power upon the occurrence of any contingency), (b)the interest in
the capital or profits of such partnership, joint venture or
limited liability company or (c)the beneficial interest in such
trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its
other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"Subsidiary Guarantors" means the Crompton Guarantors and the
Uniroyal Guarantors.
"Subsidiary Guaranty" has the meaning specified in Section
3.01(k)(x).
"Surviving Debt" has the meaning specified in Section 3.01(d).
"Swing Line A Advance" means an advance made by (a) the Swing
Line Bank pursuant to Section 2.01(d) or (b)any Working Capital A
Lender pursuant to Section 2.02(b).
"Swing Line A Borrowing" means a borrowing consisting of a Swing
Line A Advance made by the Swing Line Bank.
"Swing Line A Facility" has the meaning specified in
Section 2.01(d).
"Swing Line Advance" means a Swing Line A Advance or a Swing Line
B-1 Advance.
"Swing Line B-1 Advance" means an advance made by (a) the Swing
Line Bank pursuant to Section 2.01(e) or (b)any Working Capital
B-1 Lender pursuant to Section .02(b).
"Swing Line B-1 Borrowing" means a borrowing consisting of a
Swing Line B-1 Advance made by the Swing Line Bank.
"Swing Line B-1 Facility" has the meaning specified in Section
2.01(e).
"Swing Line Bank" means Citicorp.
"Swing Line Borrowing" means a Swing Line A Borrowing or a Swing
Line B-1 Borrowing.
"Swing Line Facility" means the Swing Line A Facility or the
Swing Line B-1 Facility.
"Tax Agreement" means the Tax Agreement to be entered into by
Crompton Corp. and some or all of its Subsidiaries.
"Taxes" has the meaning specified in Section 2.12(a).
"Termination Date" means the earlier of August 21, 2001 and the
date of termination in whole of the Working Capital A
Commitments, the Working Capital
B-1 Commitments, the Working Capital B-2 Commitments and the
Letter of Credit Commitments pursuant to Section 2.05 or 6.01.
"Total Debt" of any Person means all Debt of such Person of the
types referred to in clauses (a) though (e) of the definition of
"Debt".
"Total Debt/EBITDA Ratio" means, at any date of determination,
the ratio of Consolidated Total Debt of Crompton Corp. and its
Subsidiaries as at the end of the immediately preceding Rolling
Period to Consolidated EBITDA of Crompton Corp. and its
Subsidiaries for such immediately preceding Rolling Period.
"Trade Letter of Credit" means any Letter of Credit that is
issued under either Letter of Credit Facility for the benefit of
a supplier of Inventory to any Borrower or any of its
Subsidiaries to effect payment for such Inventory, the conditions
to drawing under which include the presentation to the Issuing
Bank that issued such Letter of Credit of negotiable bills of
lading, invoices and related documents.
"Type" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"Uniroyal" has the meaning specified in the recital of parties to
this Agreement.
"Uniroyal Borrower" has the meaning specified in the recital of
parties to this Agreement.
"Uniroyal Corp." has the meaning specified in the Preliminary
Statements.
"Uniroyal Corp. Senior Notes" means the 10-1/2% Senior Notes due
2002 in an aggregate principal amount of $300,000,000, issued by
Uniroyal Corp. pursuant to an Indenture dated as of February 8,
1993 between Uniroyal Corp. and State Street Bank and Trust
Company, as Trustee, as amended, supplemented or otherwise
modified from time to time.
"Uniroyal Corp. Senior Subordinated Notes" means the 11% Senior
Subordinated Notes due 2003 in an aggregate principal amount of
$325,000,000, issued by Uniroyal Corp. pursuant to an Indenture
dated as of February 8, 0000 xxxxxxx Xxxxxxxx Xxxx. xxx Xxxxxx
Xxxxxx Trust Company of New York, as Trustee, as amended,
supplemented or otherwise modified from time to time.
"Uniroyal Corp. Subordinated Discount Notes" means the 12%
Subordinated Discount Notes due 2005 in an aggregate principal
amount of $229,952,000, issued by Uniroyal Corp. pursuant to an
Indenture dated as of February 8, 1993 between Uniroyal Corp. and
Shawmut Bank Connecticut, National Association, as Trustee, as
amended, supplemented or otherwise modified from time to time.
"Uniroyal Guarantors" means Uniroyal Corp., the Subsidiaries of
Uniroyal Corp. listed on Part II of Schedule II hereto and each
other Subsidiary of Uniroyal Corp. that shall be required to
execute and deliver a guaranty pursuant to Section 5.01(k).
"Uniroyal Indentures" means the Indenture dated as of February 8,
1993 between Uniroyal Corp. and State Street Bank and Trust
Company, as Trustee, pursuant to which the Uniroyal Corp. Senior
Notes were issued, the Indenture dated as of February 8, 0000
xxxxxxx Xxxxxxxx Xxxx. xxx Xxxxxx Xxxxxx Trust Company of New
York, as Trustee, pursuant to which the Uniroyal Corp. Senior
Subordinated Notes were issued, the Indenture dated as of
February 8, 1993 between Uniroyal Corp. and Shawmut Bank
Connecticut, National Association, as Trustee, pursuant to which
the Uniroyal Corp. Subordinated Discount Notes were issued, and
the Indenture dated as of September 1, 1993 between Uniroyal and
State Street Bank and Trust Company, as Trustee, pursuant to
which the Uniroyal Senior Notes were issued, in each case as
amended, supplemented or otherwise modified or refinanced or
refunded from time to time in accordance with its terms, to the
extent permitted in accordance with the Loan Documents.
"Uniroyal Security Agreement" has the meaning specified in
Section 3.01(k)(viii).
"Uniroyal Senior Notes" means the 9% Senior Notes issued by
Uniroyal pursuant to an Indenture dated as of September 1, 1993
between Uniroyal and State Street Bank and Trust Company, as
Trustee, as amended, supplemented or otherwise modified from time
to time.
"Unused Working Capital Commitment" means, with respect to any
Working Capital Facility and any Working Capital Lender at any
time, (a)such Lender's Working Capital Commitment under such
Working Capital Facility at such time minus (b)the sum of (i)the
aggregate principal amount of all Working Capital Advances, Swing
Line Advances and Letter of Credit Advances made under such
Working Capital Facility by such Lender (in its capacity as a
Lender) and outstanding at such time, plus (ii)such Lender's Pro
Rata Share of (A)the aggregate Available Amount of all Letters of
Credit outstanding under such Working Capital Facility at such
time, (B)the aggregate principal amount of all Letter of Credit
Advances made under such Working Capital Facility by the Issuing
Banks pursuant to Section 2.03(c) and outstanding at such time,
(C)the aggregate principal amount of all Swing Line Advances made
under such Working Capital Facility by the Swing Line Bank
pursuant to Section 2.01(d) or (e), as the case may be, and
outstanding at such time and (D) in the case of the Working
Capital B-1 Facilities, the amount of the Working Capital B-1
Commitments then reserved pursuant to Section 2.01(g).
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which
are ordinarily, in the absence of contingencies, entitled to vote
for the election of directors (or persons performing similar
functions) of such Person, even if the right so to vote has been
suspended by the happening of such a contingency.
"Welfare Plan" means a welfare plan, as defined in Section 3(1)
of ERISA, that is maintained for employees of any Loan Party or
in respect of which any Loan Party could have liability.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"Working Capital A Advance" has the meaning specified in Section
2.01(a).
"Working Capital A Borrowing" means a borrowing consisting of
simultaneous Working Capital A Advances of the same Type made by
the Working Capital A Lenders.
"Working Capital A Commitment" means, with respect to any Working
Capital A Lender at any time, the amount set forth opposite such
Lender's name on Schedule I hereto under the caption "Working
Capital A Commitment" or, if such Lender has entered into one or
more Assignments and Acceptances, set forth for such Lender in
the Register maintained by the Agent pursuant to Section8.07(d)
as such Lender's "Working Capital A Commitment", as such amount
may be reduced at or prior to such time pursuant to Section2.05.
"Working Capital A Facility" means, at any time, the aggregate
amount of the Working Capital A Lenders' Working Capital A
Commitments at such time.
"Working Capital A Lender" means any Lender that has a Working
Capital A Commitment.
"Working Capital A Note" means a promissory note of any Crompton
Borrower payable to the order of any Working Capital A Lender, in
substantially the form of Exhibit A-1 hereto, evidencing the
aggregate indebtedness of such Borrower to such Lender resulting
from the Working Capital A Advances made by such Lender.
"Working Capital Advance" means a Working Capital A Advance, a
Working Capital B-1 Advance or a Working Capital B-2 Advance.
"Working Capital B-1 Advance" has the meaning specified in
Section 2.01(b).
"Working Capital B-1 Borrowing" means a borrowing consisting of
simultaneous Working Capital B-1 Advances of the same Type made
by the Working Capital B-1 Lenders.
"Working Capital B-1 Commitment" means, with respect to any
Working Capital B-1 Lender at any time, the amount set forth
opposite such Lender's name on Schedule I hereto under the
caption "Working Capital B-1 Commitment" or, if such Lender has
entered into one or more Assignments and Acceptances, set forth
for such Lender in the Register maintained by the Agent pursuant
to Section 8.07(d) as such Lender's "Working Capital B-1
Commitment", as such amount may be reduced at or prior to such
time pursuant to Section 2.05.
"Working Capital B-1 Facility" means, at any time, the aggregate
amount of the Working Capital B-1 Lenders' Working Capital B-1
Commitments at such time.
"Working Capital B-1 Lender" means any Lender that has a Working
Capital B-1 Commitment.
"Working Capital B-1 Note" means a promissory note of the
Uniroyal Borrower payable to the order of any Working Capital B-1
Lender, in substantially the form of Exhibit A-2 hereto,
evidencing the aggregate indebtedness of the Uniroyal Borrower to
such Lender resulting from the Working Capital B-1 Advances made
by such Lender.
"Working Capital B-2 Advance" has the meaning specified in
Section 2.01(c).
"Working Capital B-2 Borrowing" means a borrowing consisting of
simultaneous Working Capital B-2 Advances of the same Type made
by the Working Capital B-2 Lenders.
"Working Capital B-2 Commitment" means, with respect to any
Working Capital B-2 Lender at any time, the amount set forth
opposite such Lender's name on Schedule I hereto under the
caption "Working Capital B-2 Commitment" or, if such Lender has
entered into one or more Assignments and Acceptances, set forth
for such Lender in the Register maintained by the Agent pursuant
to Section 8.07(d) as such Lender's "Working Capital B-2
Commitment", as such amount may be reduced at or prior to such
time pursuant to Section 2.05.
"Working Capital B-2 Facility" means, at any time, the aggregate
amount of the Working Capital B-2 Lenders' Working Capital B-2
Commitments at such time.
"Working Capital B-2 Lender" means any Lender that has a Working
Capital B-2 Commitment.
"Working Capital B-2 Note" means a promissory note of the
Uniroyal Borrower payable to the order of any Working Capital B-2
Lender, in substantially the form of Exhibit A-3 hereto,
evidencing the aggregate indebtedness of the Uniroyal Borrower to
such Lender resulting from the Working Capital B-2 Advances made
by such Lender.
"Working Capital Borrowing" means a Working Capital A Borrowing,
a Working Capital B-1 Borrowing or a Working Capital B-2
Borrowing.
"Working Capital Facility" means a Working Capital A Facility, a
Working Capital B-1 Facility or a Working Capital B-2 Facility.
"Working Capital Lender" means a Working Capital A Lender, a
Working Capital B-1 Lender or a Working Capital B-2 Lender.
SECTION 1.02. Computation of Time Periods. In this Agreement in
the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including"
and the words "to" and "until" each mean "to but excluding".
SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with
generally accepted accounting principles consistent with those
applied in the preparation of the financial statements referred
to in Section 4.01(f), in the case of Crompton Corp. and its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries),
and Section 4.01(g), in the case of Uniroyal Corp. and its
Subsidiaries ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. The Advances. (a) The Working Capital A
Advances. Each Working Capital A Lender severally agrees, on the
terms and conditions hereinafter set forth, to make advances
(each a "Working Capital A Advance") to any Crompton Borrower
from time to time on any Business Day during the period from the
date hereof until the Termination Date in an amount for each such
Advance not to exceed such Lender's Unused Working Capital
Commitment under the Working Capital A Facility at such time.
Each Working Capital A Borrowing shall be in an aggregate amount
of $5,000,000 (or, if the Swing Line Bank shall, in its sole
discretion, decline to make a Swing Line A Advance on such
Business Day after a request therefor by such Crompton Borrower
pursuant to Section 2.01(d), $1,000,000) or an integral multiple
of $1,000,000 in excess thereof and shall consist of Working
Capital A Advances made simultaneously by the Working Capital A
Lenders ratably according to their Working Capital A Commitments.
Within the limits of each Working Capital A Lender's Unused
Working Capital Commitment under the Working Capital A Facility
in effect from time to time, the Crompton Borrowers may borrow
under this Section 2.01(a), prepay pursuant to Section 2.06(a)
and reborrow under this Section 2.01(a).
(b)The Working Capital B-1 Advances. Each Working Capital B-1
Lender severally agrees, on the terms and conditions hereinafter
set forth, to make advances (each a "Working Capital B-1
Advance") to the Uniroyal Borrower from time to time on any
Business Day during the period from the date hereof until the
Termination Date in an amount for each such Advance not to exceed
such Lender's Unused Working Capital Commitment under the Working
Capital B-1 Facility at such time. Each Working Capital B-1
Borrowing shall be in an aggregate amount of $5,000,000 (or, if
the Swing Line Bank shall, in its sole discretion, decline to
make a Swing Line B-1 Advance on such Business Day after a
request therefor by the Uniroyal Borrower pursuant to Section
2.01(e), $1,000,000) or an integral multiple of $1,000,000 in
excess thereof and shall consist of Working Capital B-1 Advances
made simultaneously by the Working Capital B-1 Lenders ratably
according to their Working Capital B-1 Commitments. Within the
limits of each Working Capital B-1 Lender's Unused Working
Capital Commitment under the Working Capital B-1 Facility in
effect from time to time, the Uniroyal Borrower may borrow under
this Section 2.01(b), prepay pursuant to Section 2.06(a) and
reborrow under this Section 2.01(b).
(c)The Working Capital B-2 Advances. Each Working Capital B-2
Lender severally agrees, on the terms and conditions hereinafter
set forth, to make advances (each a "Working Capital B-2
Advance") to the Uniroyal Borrower from time to time on any
Business Day during the period from the date hereof until the
Termination Date in an amount for each such Advance not to exceed
such Lender's Unused Working Capital Commitment under the Working
Capital B-2 Facility at such time. Each Working Capital B-2
Borrowing shall be in an aggregate amount of $5,000,000 or an
integral multiple of $1,000,000 in excess thereof and shall
consist of Working Capital B-2 Advances made simultaneously by
the Working Capital B-2 Lenders ratably according to their
Working Capital B-2 Commitments. Within the limits of each
Working Capital B-2 Lender's Unused Working Capital Commitment
under the Working Capital B-2 Facility in effect from time to
time, the Uniroyal Borrower may borrow under this
Section 2.01(c), prepay pursuant to Section 2.06(a) and reborrow
under this Section 2.01(c).
(d)The Swing Line A Advances. Any Crompton Borrower may request
the Swing Line Bank to make, and the Swing Line Bank may, if in
its sole discretion it elects to do so, make, on the terms and
conditions hereinafter set forth, Swing Line A Advances to such
Crompton Borrower from time to time on any Business Day during
the period from the date hereof until the Termination Date (i) in
an aggregate amount not to exceed at any time outstanding
$10,000,000 (the "Swing Line A Facility") and (ii) in an amount
for each such Swing Line A Borrowing not to exceed the aggregate
of the Unused Working Capital Commitments under the Working
Capital A Facility of the Working Capital A Lenders at such time.
No Swing Line A Advance shall be used for the purpose of funding
the payment of principal of any other Swing Line A Advance. Each
Swing Line A Borrowing shall be in an amount of $500,000 or an
integral multiple of $100,000 in excess thereof and shall be made
as a Base Rate Advance. Within the limits of the Swing Line A
Facility and within the limits referred to in clause (ii) above,
so long as the Swing Line Bank, in its sole discretion, elects to
make Swing Line A Advances, the Crompton Borrowers may borrow
under this Section 2.01(d), repay pursuant to Section 2.04(d) or
prepay pursuant to Section 2.06(a) and reborrow under this
Section 2.01(d).
(e)The Swing Line B-1 Advances. The Uniroyal Borrower may
request the Swing Line Bank to make, and the Swing Line Bank may,
if in its sole discretion it elects to do so, make, on the terms
and conditions hereinafter set forth, Swing Line B-1 Advances to
the Uniroyal Borrower from time to time on any Business Day
during the period from the date hereof until the Termination Date
(i) in an aggregate amount not to exceed at any time outstanding
$10,000,000 (the "Swing Line B-1 Facility") and (ii) in an amount
for each such Swing Line Borrowing not to exceed the aggregate of
the Unused Working Capital Commitments under the Working Capital
B-1 Facility of the Working Capital B-1 Lenders at such time. No
Swing Line B-1 Advance shall be used for the purpose of funding
the payment of principal of any other Swing Line B-1 Advance.
Each Swing Line B-1 Borrowing shall be in an amount of $500,000
or an integral multiple of $100,000 in excess thereof and shall
be made as a Base Rate Advance. Within the limits of the Swing
Line B-1 Facility and within the limits referred to in
clause (ii) above, so long as the Swing Line Bank, in its sole
discretion, elects to make Swing Line B-1 Advances, the Uniroyal
Borrower may borrow under this Section 2.01(e), repay pursuant to
Section 2.04(d) or prepay pursuant to Section 2.06(a) and
reborrow under this Section 2.01(e).
(f)Letters of Credit. Each Issuing Bank severally agrees, on the
terms and conditions hereinafter set forth, to issue letters of
credit (together with the Existing Letters of Credit referred to
in Section 2.03(e), the "Letters of Credit") for the account of
any Borrower from time to time on any Business Day during the
period from the date hereof until 30 days before the Termination
Date (i) in an aggregate Available Amount for all Letters of
Credit issued by such Issuing Bank not to exceed at any time such
Issuing Bank's Letter of Credit Commitment at such time under the
Facility which the applicable Notice of Issuance specifies as the
Facility under which such Letter of Credit is to be issued,
(ii) in an Available Amount for each such Letter of Credit to be
issued under the Letter of Credit A Facility not to exceed the
lesser of (x) the Letter of Credit A Facility at such time and
(y) the Unused Working Capital Commitments of the Working Capital
A Lenders under the Working Capital A Facility at such time and
(iii) in an Available Amount for each such Letter of Credit to be
issued under the Letter of Credit B-1 Facility not to exceed the
lesser of (x) the Letter of Credit B-1 Facility at such time and
(y) the Unused Working Capital Commitments of the Working Capital
B-1 Lenders under the Working Capital B-1 Facility at such time.
Letters of Credit issued under the Letter of Credit A Facility
shall be issued for the account of any Crompton Borrower and
Letters of Credit issued under the Letter of Credit B-1 Facility
shall be issued for the account of the Uniroyal Borrower. No
Letter of Credit shall have an expiration date (including all
rights of the applicable Borrower or the beneficiary to require
renewal) later than the earlier of 30 days before the Termination
Date and (A) in the case of a Standby Letter of Credit, one year
after the date of issuance thereof and (B) in the case of a Trade
Letter of Credit, 90 days after the date of issuance thereof.
Within the limits of the Letter of Credit A Facility or the
Letter of Credit B-1 Facility, as the case may be, and subject to
the limits referred to above, the Crompton Borrowers or the
Uniroyal Borrower, as the case may be, may request the issuance
of Letters of Credit under this Section 2.01(f), repay any Letter
of Credit Advances resulting from drawings thereunder pursuant to
Section 2.03(c) and request the issuance of additional Letters of
Credit under this Section 2.01(f).
(g)Set Aside of Working Capital B-1 Commitments in Respect of the
Seoul Guaranty. Each Working Capital B-1 Lender's Pro Rata Share
of an aggregate amount of Working Capital B-1 Commitments equal
to the Seoul Guaranty Amount shall be reserved to ensure that
sufficient funds may be made available to the Uniroyal Borrower
for payment to Citibank Seoul of the Seoul Guaranty Amount as the
same becomes due and payable. The amount of Working Capital B-1
Commitments reserved under this Section 2.01(g) shall equal the
Seoul Guaranty Amount from time to time.
SECTION 2.02. Making the Advances. (a) Except as otherwise
provided in Section 2.02(b) or 2.03, each Borrowing shall be made
on notice, given not later than 11:00 A.M. (New York City time)
on (x) the third Business Day prior to the date of the proposed
Borrowing in the case of a Borrowing consisting of Eurodollar
Rate Advances, or (y) the first Business Day prior to the date of
the proposed Borrowing (or, if the Swing Line Bank shall, in its
sole discretion, decline to make a Swing Line Advance on the date
of the proposed Borrowing after a request therefor by a Borrower
pursuant to Section 2.01(d) or (e), the date of the proposed
Borrowing) in the case of a Borrowing consisting of Base Rate
Advances, by any Borrower to the Agent, which shall give to each
Appropriate Lender prompt notice thereof by telex or telecopier.
Each such notice of a Borrowing (a "Notice of Borrowing") shall
be by telephone, confirmed immediately in writing, or telex or
telecopier, in substantially the form of Exhibit B hereto,
specifying therein the requested (i) date of such Borrowing,
(ii) Facility under which such Borrowing is to be made,
(iii) Type of Advances comprising such Borrowing, (iv) aggregate
amount of such Borrowing and (v) in the case of a Borrowing
consisting of Eurodollar Rate Advances, initial Interest Period
for each such Advance. Each Appropriate Lender shall, before
11:00 A.M. (New York City time) on the date of such Borrowing,
make available for the account of its Applicable Lending Office
to the Agent at the Agent's Account, in same day funds, such
Lender's ratable portion of such Borrowing in accordance with the
respective Commitments under the applicable Facility of such
Lender and the other Appropriate Lenders. After the Agent's
receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the Agent will make such
funds available to the relevant Borrower by crediting the
relevant Borrower's Account.
(b)Each Swing Line Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York City time) on the date of the
proposed Swing Line Borrowing, by any Borrower to the Swing Line
Bank and the Agent. Each such notice of a Swing Line Borrowing
(a "Notice of Swing Line Borrowing") shall be by telephone,
confirmed immediately in writing, or telex or telecopier,
specifying therein the requested (i) date of such Borrowing,
(ii) amount of such Borrowing and (iii) maturity of such
Borrowing (which maturity shall be no later than the seventh day
after the requested date of such Borrowing). If, in its sole
discretion, it elects to make the requested Swing Line Advance,
the Swing Line Bank will make the amount thereof available to the
Agent at the Agent's Account, in same day funds. After the
Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Agent will
make such funds available to the relevant Borrower by crediting
the relevant Borrower's Account. Upon written demand by the
Swing Line Bank with an outstanding Swing Line A Advance or Swing
Line B-1 Advance, as the case may be, with a copy of such demand
to the Agent, each other Working Capital A Lender or Working
Capital B-1 Lender, as the case may be, shall purchase from the
Swing Line Bank, and the Swing Line Bank shall sell and assign to
each such other Working Capital A Lender or Working Capital B-1
Lender, as the case may be, such other Lender's Pro Rata Share of
such outstanding Swing Line A Advance or Swing Line B-1 Advance,
as the case may be, as of the date of such demand, by making
available for the account of its Applicable Lending Office to the
Agent for the account of the Swing Line Bank, by deposit to the
Agent's Account, in same day funds, an amount equal to the
portion of the outstanding principal amount of such Swing Line A
Advance or Swing Line B-1 Advance, as the case may be, to be
purchased by such Lender. Each Borrower hereby agrees to each
such sale and assignment. Each Working Capital A Lender agrees
to purchase its Pro Rata Share of an outstanding Swing Line A
Advance and each Working Capital B-1 Lender agrees to purchase
its Pro Rata Share of an outstanding Swing Line B-1 Advance on
(i) the Business Day on which demand therefor is made by the
Swing Line Bank, provided that notice of such demand is given not
later than 11:00 A.M. (New York City time) on such Business Day
or (ii) the first Business Day next succeeding such demand if
notice of such demand is given after such time. Upon any such
assignment by the Swing Line Bank to any other Working Capital
Lender of a portion of a Swing Line Advance, the Swing Line Bank
represents and warrants to such other Lender that the Swing Line
Bank is the legal and beneficial owner of such interest being
assigned by it, but makes no other representation or warranty and
assumes no responsibility with respect to such Swing Line
Advance, the Loan Documents or any Loan Party. If and to the
extent that any Working Capital A Lender or Working Capital B-1
Lender, as the case may be, shall not have so made the amount of
such Swing Line A Advance or Swing Line B-1 Advance, as the case
may be, available to the Agent, such Lender agrees to pay to the
Agent forthwith on demand such amount together with interest
thereon, for each day from the date of demand by the Swing Line
Bank until the date such amount is paid to the Agent, at the
Federal Funds Rate. If such Lender shall pay to the Agent such
amount for the account of the Swing Line Bank on any Business
Day, such amount so paid in respect of principal shall constitute
a Swing Line Advance made by such Lender on such Business Day for
purposes of this Agreement, and the outstanding principal amount
of the Swing Line Advance made by the Swing Line Bank shall be
reduced by such amount on such Business Day.
(c)Anything in subsection (a) above to the contrary
notwithstanding, (i) the Borrowers may not select Eurodollar Rate
Advances for any Borrowing if the aggregate amount of such
Borrowing is less than $5,000,000 or if the obligation of the
Appropriate Lenders to make Eurodollar Rate Advances shall then
be suspended pursuant to Section 2.09 or Section 2.10 and
(ii) the Working Capital Advances may not be outstanding as part
of more than 12 separate Borrowings.
(d)Each Notice of Borrowing and Notice of Swing Line Borrowing
shall be irrevocable and binding on the Borrower giving such
notice. In the case of any Borrowing that the related Notice of
Borrowing specifies is to be comprised of Eurodollar Rate
Advances, the Borrower giving such notice shall indemnify each
Appropriate Lender against any loss, cost or expense incurred by
such Lender as a result of any failure to fulfill on or before
the date specified in such Notice of Borrowing for such Borrowing
the applicable conditions set forth in Article III, including,
without limitation, any loss (including loss of anticipated
profits), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of
such Borrowing when such Advance, as a result of such failure, is
not made on such date.
(e)Unless the Agent shall have received notice from an
Appropriate Lender prior to the date of any Borrowing under a
Facility under which such Lender has a Commitment that such
Lender will not make available to the Agent such Lender's ratable
portion of such Borrowing, the Agent may assume that such Lender
has made such portion available to the Agent on the date of such
Borrowing in accordance with subsection (a) or (b) of this
Section 2.02 and the Agent may, in reliance upon such assumption,
make available to the relevant Borrower on such date a
corresponding amount. If and to the extent that such Lender
shall not have so made such ratable portion available to the
Agent, such Lender and the relevant Borrower severally agree to
repay or pay to the Agent forthwith on demand such corresponding
amount and to pay interest thereon, for each day from the date
such amount is made available to such Borrower until the date
such amount is repaid or paid to the Agent, at (i) in the case of
the Borrowers, the interest rate applicable at such time under
Section 2.07 to Advances comprising such Borrowing and (ii) in
the case of such Lender, the Federal Funds Rate. If such Lender
shall pay to the Agent such corresponding amount, such amount so
paid shall constitute such Lender's Advance as part of such
Borrowing for all purposes.
(f)The failure of any Lender to make the Advance to be made by it
as part of any Borrowing shall not relieve any other Lender of
its obligation, if any, hereunder to make its Advance on the date
of such Borrowing, but no Lender shall be responsible for the
failure of any other Lender to make the Advance to be made by
such other Lender on the date of any Borrowing.
(g)The Uniroyal Borrower hereby irrevocably authorizes and
appoints Citibank as its attorney-in-fact to execute and deliver
a Notice of Borrowing in accordance with Section 2.02(a) or a
Notice of Swing Line Borrowing in accordance with Section
2.02(b), on behalf of and in the name of the Uniroyal Borrower,
for a Working Capital B-1 Borrowing or Swing Line B-1 Borrowing,
as the case may be, in an aggregate amount not to exceed the
Seoul Guaranty Amount. The Uniroyal Borrower hereby authorizes
each of Citibank and Citibank Seoul, in its discretion, to hold
the proceeds of such Borrowing as collateral for, and/or then or
at any time thereafter to apply such proceeds in whole or in part
against the Obligations of the Uniroyal Borrower under the Seoul
Guaranty. Each Working Capital B-1 Lender severally agrees,
notwithstanding any other term or condition of this Agreement
(including, without limitation, any non-fulfillment of any of the
conditions specified in Article III), to make an Advance to or
for the account of the Uniroyal Borrower for the purposes
specified in the proviso to the first sentence of Section 2.14
hereof, on any Business Day during the period from the date
hereof until the Termination Date, in an aggregate amount not to
exceed such Lender's Pro Rata Share of the amount of Working
Capital B-1 Commitments then reserved pursuant to Section
2.01(g); provided that, after giving effect to the Advances made
pursuant to this Section 2.02(g), the sum of the aggregate
principal amount of Working Capital B-1 Advances, Swing Line B-1
Advances and Letter of Credit B-1 Advances then outstanding plus
the Available Amount of all Letters of Credit issued under the
Letter of Credit B-1 Facility and then outstanding shall not
exceed the aggregate Working Capital B-1 Commitments.
SECTION 2.03. Issuance of and Drawings and Reimbursement Under
Letters of Credit. (a) Request for Issuance. Each Letter of
Credit shall be issued upon notice, given not later than
11:00 A.M. (New York City time) on the second Business Day prior
to the date of the proposed issuance of such Letter of Credit, by
any Crompton Borrower to any Issuing Bank under the Letter of
Credit A Facility or by the Uniroyal Borrower to any Issuing Bank
under the Letter of Credit B-1 Facility, which shall give to the
Agent and each Appropriate Lender prompt notice thereof by telex
or telecopier. Each such notice of issuance of a Letter of
Credit (a "Notice of Issuance") shall be by telephone, confirmed
immediately in writing, or telex or telecopier, specifying
therein the requested (A) date of such issuance (which shall be a
Business Day), (B) Available Amount of such Letter of Credit,
(C) expiration date of such Letter of Credit, (D) name and
address of the beneficiary of such Letter of Credit, (E) Facility
under which such Letter of Credit is to be issued and (F) form of
such Letter of Credit, and shall be accompanied by such
application and agreement for letter of credit as such Issuing
Bank may specify to the relevant Borrower for use in connection
with such requested Letter of Credit (a "Letter of Credit
Agreement"). If (x) the requested form of such Letter of Credit
is acceptable to such Issuing Bank in its sole discretion and (y)
it has not received notice of objection to such issuance from
Appropriate Lenders holding at least 51% of the Working Capital A
Commitments or Working Capital B-1 Commitments, as the case may
be, such Issuing Bank will, upon fulfillment of the applicable
conditions set forth in Article III, make such Letter of Credit
available to the Borrower requesting the issuance of such Letter
of Credit at its office referred to in Section 8.02 or as
otherwise agreed with such Borrower in connection with such
issuance. In the event and to the extent that the provisions of
any Letter of Credit Agreement shall conflict with this
Agreement, the provisions of this Agreement shall govern.
(b)Letter of Credit Reports. Each Issuing Bank shall furnish
(A) to the Agent on the first Business Day of each week a written
report summarizing issuance and expiration dates of Letters of
Credit issued by such Issuing Bank during the previous week and
drawings during such week under all Letters of Credit issued by
such Issuing Bank, (B) to each Appropriate Lender on the first
Business Day of each month a written report summarizing issuance
and expiration dates of Letters of Credit issued by such Issuing
Bank during the preceding month and drawings during such month
under all Letters of Credit issued by such Issuing Bank and
(C) to the Agent and each Appropriate Lender on the first
Business Day of each calendar quarter a written report setting
forth the average daily aggregate Available Amount during the
preceding calendar quarter of all Letters of Credit issued by
such Issuing Bank.
(c)Drawing and Reimbursement. The payment by any Issuing Bank of
a draft drawn under any Letter of Credit shall constitute for all
purposes of this Agreement the making by such Issuing Bank of a
Letter of Credit Advance, which shall be a Base Rate Advance, in
the amount of such draft. Upon payment by any Issuing Bank of a
draft drawn under any Letter of Credit, such Issuing Bank shall
give prompt notice thereof to the applicable Borrower and the
Agent. Upon written demand by any Issuing Bank with an
outstanding Letter of Credit Advance, with a copy of such demand
to the Agent, each Appropriate Lender shall purchase from such
Issuing Bank, and such Issuing Bank shall sell and assign to each
such Appropriate Lender, such Lender's Pro Rata Share of such
outstanding Letter of Credit Advance as of the date of such
purchase, by making available for the account of its Applicable
Lending Office to the Agent for the account of such Issuing Bank,
by deposit to the Agent's Account, in same day funds, an amount
equal to the portion of the outstanding principal amount of such
Letter of Credit Advance to be purchased by such Lender.
Promptly after receipt thereof, the Agent shall transfer such
funds to such Issuing Bank. Each Borrower hereby agrees to each
such sale and assignment. Each Appropriate Lender agrees to
purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made
by the Issuing Bank which made such Advance, provided notice of
such demand is given not later than 11:00 A.M. (New York City
time) on such Business Day or (ii) the first Business Day next
succeeding such demand if notice of such demand is given after
such time. Upon any such assignment by an Issuing Bank to any
Appropriate Lender of a portion of a Letter of Credit Advance,
such Issuing Bank represents and warrants to such Appropriate
Lender that such Issuing Bank is the legal and beneficial owner
of such interest being assigned by it, free and clear of any
liens, but makes no other representation or warranty and assumes
no responsibility with respect to such Letter of Credit Advance,
the Loan Documents or any Loan Party. If and to the extent that
any Appropriate Lender shall not have so made the amount of such
Letter of Credit Advance available to the Agent, such Appropriate
Lender agrees to pay to the Agent forthwith on demand such amount
together with interest thereon, for each day from the date of
demand by such Issuing Bank until the date such amount is paid to
the Agent, at the Federal Funds Rate for its account or the
account of such Issuing Bank, as applicable. If such Lender
shall pay to the Agent such amount for the account of such
Issuing Bank on any Business Day, such amount so paid in respect
of principal shall constitute a Letter of Credit Advance made by
such Lender on such Business Day for purposes of this Agreement,
and the outstanding principal amount of the Letter of Credit
Advance made by such Issuing Bank shall be reduced by such amount
on such Business Day.
(d)Failure to Make Letter of Credit Advances. The failure of any
Lender to make the Letter of Credit Advance to be made by it on
the date specified in Section 2.03(c) shall not relieve any other
Lender of its obligation hereunder to make its Letter of Credit
Advance on such date, but no Lender shall be responsible for the
failure of any other Lender to make the Letter of Credit Advance
to be made by such other Lender on such date.
(e)Existing Letters of Credit. Pursuant to the Credit Agreement
dated as of December 21, 1995 (the "1995 Credit Agreement") among
the Uniroyal Borrower, the lender parties party thereto and
Citicorp as agent for the lender parties thereunder, the "Issuing
Bank" thereunder issued "Letters of Credit" (such Letters of
Credit as are outstanding under the 1995 Credit Agreement on the
Effective Date and set forth on Schedule 2.03(e) hereto being the
"Existing Letters of Credit") for the account of the Uniroyal
Borrower. Effective as of the Effective Date: (i) the "Issuing
Bank" under the 1995 Credit Agreement will be deemed to have sold
and transferred, and each Working Capital B-1 Lender hereunder
will be deemed to have purchased and received, without further
action on the part of any party, an undivided interest and
participation in such Existing Letters of Credit, based on such
Working Capital B-1 Lender's Pro Rata Share of the Working
Capital B-1 Facility; and (ii) the Existing Letters of Credit
will be deemed to be Letters of Credit hereunder.
SECTION 2.04. Repayment of Advances. (a) Working Capital A
Advances. Each Crompton Borrower shall repay to the Agent for
the ratable account of the Working Capital A Lenders on the
Termination Date the aggregate principal amount of the Working
Capital A Advances made to such Crompton Borrower and then
outstanding.
(b)Working Capital B-1 Advances. The Uniroyal Borrower shall
repay to the Agent for the ratable account of the Working Capital
B-1 Lenders on the Termination Date the aggregate principal
amount of the Working Capital B-1 Advances then outstanding.
(c)Working Capital B-2 Advances. The Uniroyal Borrower shall
repay to the Agent for the ratable account of the Working Capital
B-2 Lenders on the Termination Date the aggregate outstanding
principal amount of the Working Capital B-2 Advances then
outstanding.
(d)Swing Line Advances. Each Borrower shall repay to the Agent
for the account of the Swing Line Bank and each other Working
Capital Lender that has made a Swing Line Advance the outstanding
principal amount of each Swing Line Advance made by each of them
and owing by such Borrower on the earlier of the maturity date
specified in the applicable Notice of Swing Line Borrowing (which
maturity shall be no later than the seventh day after the
requested date of such Borrowing) and the Termination Date.
(e)Letter of Credit Advances. (i) Each Borrower shall repay to
the Agent for the account of each Issuing Bank and each other
Working Capital Lender that has made a Letter of Credit Advance
on the earlier of the second Business Day following the date on
which such Letter of Credit is drawn and the Termination Date the
outstanding principal amount of each Letter of Credit Advance
made by each of them.
(ii)The Obligations of each Borrower under this Agreement, any
Letter of Credit Agreement and any other agreement or instrument
relating to any Letter of Credit shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the
terms of this Agreement, such Letter of Credit Agreement and such
other agreement or instrument under all circumstances, including,
without limitation, the following circumstances:
(A)any lack of validity or enforceability of any Loan Document,
any Letter of Credit Agreement, any Letter of Credit or any other
agreement or instrument relating thereto (all of the foregoing
being, collectively, the "L/C Related Documents");
(B)any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of any Borrower
in respect of any L/C Related Document or any other amendment or
waiver of or any consent to departure from all or any of the L/C
Related Documents;
(C)the existence of any claim, set-off, defense or other right
that any Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for whom any
such beneficiary or any such transferee may be acting), any
Issuing Bank or any other Person, whether in connection with the
transactions contemplated by the L/C Related Documents or any
unrelated transaction;
(D)any statement or any other document presented under a Letter
of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue
or inaccurate in any respect;
(E)payment by any Issuing Bank under a Letter of Credit against
presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit;
(F)any exchange, release or non-perfection of any Collateral or
other collateral, or any release or amendment or waiver of or
consent to departure from any Guaranty or any other guarantee,
for all or any of the Obligations of any Borrower in respect of
the L/C Related Documents; or
(G)any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including, without limitation,
any other circumstance that might otherwise constitute a defense
available to, or a discharge of, any Borrower, any Guarantor or
any other guarantor.
SECTION 2.05. Termination or Reduction of the Commitments.
(a) Optional. Crompton Corp. may, on its own behalf and on
behalf of the other Borrowers, upon at least two Business Days'
notice to the Agent, terminate in whole or reduce in part the
unused portion of either Letter of Credit Facility, either Swing
Line Facility or the Unused Working Capital Commitments under any
Working Capital Facility; provided, however, that each partial
reduction of a Facility (i) shall be in an aggregate amount of
$10,000,000 or an integral multiple of $5,000,000 in excess
thereof and (ii) shall be made ratably among the Appropriate
Lenders in accordance with their Commitments with respect to such
Facility.
(b)Mandatory. (i) The aggregate Working Capital B-2 Commitments
of the Working Capital B-2 Lenders shall be automatically and
permanently reduced, on a pro rata basis, on the following dates
in the amounts indicated:
Date Amount
December 31, 1997 5% of the Specified Amount
December 31, 1998 10% of the Specified Amount
December 31, 1999 15% of the Specified Amount
(ii) The Letter of Credit A Facility or Letter of Credit B-1
Facility, as the case may be, shall be permanently reduced from
time to time on the date of each reduction in the Working Capital
A Facility or Working Capital B-1 Facility, as the case may be,
by the amount, if any, by which the amount of the Letter of
Credit A Facility or Letter of Credit B-1 Facility, as the case
may be, exceeds the Working Capital A Facility or Working Capital
B-1 Facility, as the case may be, after giving effect to such
reduction of such Working Capital Facility.
(iii) The Swing Line A Facility or Swing Line B-1 Facility, as
the case may be, shall be permanently reduced from time to time
on the date of each reduction in the Working Capital A Facility
or Working Capital B-1 Facility, as the case may be, by the
amount, if any, by which the amount of the Swing Line A Facility
or Swing Line B-1 Facility, as the case may be, exceeds the
Working Capital A Facility or Working Capital B-1 Facility, as
the case may be, after giving effect to such reduction of such
Working Capital Facility.
(iv) Upon the date of receipt by Crompton Corp. or any of its
Subsidiaries of the Net Cash Proceeds from the sale or other
disposition of assets pursuant to clause (vii) of Section
5.02(e), the Working Capital Facilities shall be automatically
and permanently reduced, on a pro rata basis, by the amount of
such Net Cash Proceeds to the extent required under such clause
(vii).
SECTION 2.06. Prepayments. (a) Optional. Each Borrower may,
upon at least one Business Day's notice in the case of Base Rate
Advances and three Business Days' notice in the case of
Eurodollar Rate Advances, in each case to the Agent stating the
proposed date and aggregate principal amount of the prepayment,
and if such notice is given such Borrower shall, prepay the
outstanding aggregate principal amount of the Advances comprising
part of the same Borrowing in whole or ratably in part, together
with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided, however, that
(x) each partial prepayment shall be in an aggregate principal
amount of $5,000,000 or an integral multiple of $1,000,000 in
excess thereof and (y) if any prepayment of a Eurodollar Rate
Advance is made on a date other than the last day of an Interest
Period for such Advance, such Borrower shall also pay any amounts
owing pursuant to Section 8.04(c).
(b)Mandatory. (i) The Crompton Borrowers shall, on each
Business Day, prepay an aggregate principal amount of the Working
Capital A Advances comprising part of the same Borrowings, the
Letter of Credit A Advances and the Swing Line A Advances equal
to the amount by which (A) the sum of the aggregate principal
amount of (x) the Working Capital A Advances, (y) the Letter of
Credit A Advances and (z) the Swing Line A Advances then
outstanding plus the aggregate Available Amount of all Letters of
Credit then outstanding under the Working Capital A Facility
exceeds (B) the Working Capital A Facility on such Business Day.
(ii)The Uniroyal Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Working Capital B-1 Advances
comprising part of the same Borrowings, the Letter of Credit B-1
Advances and the Swing Line B-1 Advances equal to the amount by
which (A) the sum of the aggregate principal amount of (x) the
Working Capital B-1 Advances, (y) the Letter of Credit B-1
Advances and (z) the Swing Line B-1 Advances then outstanding
plus the aggregate Available Amount of all Letters of Credit then
outstanding under the Working Capital B-1 Facility exceeds
(B) the Working Capital B-1 Facility on such Business Day.
(iii)The Uniroyal Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Working Capital B-2 Advances
comprising part of the same Borrowings equal to the amount by
which the aggregate principal amount of the Working Capital B-2
Advances then outstanding exceeds the Working Capital B-2
Facility on such Business Day.
(iv)The Crompton Borrowers shall, on each Business Day, pay to
the Agent for deposit in the relevant L/C Cash Collateral Account
an amount sufficient to cause the aggregate amount on deposit in
such Account to equal the amount by which the aggregate Available
Amount of all Letters of Credit then outstanding under the
Working Capital A Facility exceeds the Letter of Credit A
Facility on such Business Day.
(v)The Uniroyal Borrower shall, on each Business Day, pay to the
Agent for deposit in the relevant L/C Cash Collateral Account an
amount sufficient to cause the aggregate amount on deposit in
such Account to equal the amount by which the aggregate Available
Amount of all Letters of Credit then outstanding under the Letter
of Credit B-1 Facility exceeds the Letter of Credit B-1 Facility
on such Business Day.
(vi)Prepayments of the Working Capital A Facility or Working
Capital B-1 Facility made pursuant to clause (i) or (ii) above
shall be first applied to prepay Letter of Credit Advances then
outstanding under such Facility until such Advances are paid in
full, second applied to prepay Swing Line Advances then
outstanding under such Facility until such Advances are paid in
full, third applied to prepay Working Capital Advances then
outstanding under such Facility comprising part of the same
Borrowings until such Advances are paid in full and fourth
deposited in the relevant L/C Cash Collateral Account to cash
collateralize 100% of the Available Amount of the Letters of
Credit then outstanding under such Facility.
(vii)All prepayments under this subsection (b) shall be made
together with accrued interest to the date of such prepayment on
the principal amount prepaid.
SECTION 2.07. Interest. (a) Scheduled Interest. Each Borrower
shall pay interest on the unpaid principal amount of each Advance
made to such Borrower and owing to each Lender from the date of
such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i)Base Rate Advances. During such periods as such Advance is a
Base Rate Advance, a rate per annum equal at all times to the sum
of (A) the Base Rate in effect from time to time plus (B) the
Applicable Margin in effect from time to time, payable in arrears
quarterly on the first day of each October, January, April and
July during such periods and on the date such Base Rate Advance
shall be Converted or paid in full.
(ii)Eurodollar Rate Advances. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at
all times during each Interest Period for such Advance to the sum
of (A) the Eurodollar Rate for such Interest Period for such
Advance plus (B) the Applicable Margin in effect from time to
time, payable in arrears on the last day of such Interest Period
and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every
three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid
in full.
(b)Default Interest. Upon the occurrence and during the
continuance of an Event of Default, each Borrower shall pay
interest on (i) the unpaid principal amount of each Advance made
to such Borrower and owing to each Lender, payable in arrears on
the dates referred to in clause (a)(i) or (a)(ii) above and on
demand, at a rate per annum equal at all times to 2% per annum
above the rate per annum required to be paid on such Advance
pursuant to clause (a)(i) or (a)(ii) above and (ii) to the
fullest extent permitted by law, the amount of any interest, fee
or other amount payable hereunder that is not paid when due, from
the date such amount shall be due until such amount shall be paid
in full, payable in arrears on the date such amount shall be paid
in full and on demand, at a rate per annum equal at all times to
2% per annum above the rate per annum required to be paid, in the
case of interest, on the Type of Advance on which such interest
has accrued pursuant to clause (a)(i) or (a)(ii) above, and, in
all other cases, on Base Rate Advances pursuant to clause (a)(i)
above.
(c)Notice of Interest Rate. Promptly after receipt of a Notice
of Borrowing pursuant to Section 2.02(a), the Agent shall give
notice to the relevant Borrower and each Appropriate Lender of
the applicable interest rate determined by the Agent for purposes
of clause (a)(i) or (ii).
SECTION 2.08. Fees. (a) Commitment Fee. The Borrowers jointly
and severally agree to pay to the Agent for the account of the
Lenders a commitment fee, from August 15, 1996 in the case of
each Initial Lender and from the effective date specified in the
Assignment and Acceptance pursuant to which it became a Lender in
the case of each other Lender until the Termination Date, payable
in arrears on the date of the initial Borrowing hereunder,
thereafter quarterly on the first Business Day of each quarter,
commencing August 1, 1996, and on the Termination Date, at a rate
per annum equal to the Applicable Percentage in effect from time
to time on the average daily Unused Working Capital Commitments
of such Lender (without giving effect to clause (b)(ii)(D) of the
definition of "Unused Working Capital Commitment"); provided,
however, that any commitment fee accrued with respect to any of
the Commitments of a Defaulting Lender during the period prior to
the time such Lender became a Defaulting Lender and unpaid at
such time shall not be payable by the Borrowers so long as such
Lender shall be a Defaulting Lender except to the extent that
such commitment fee shall otherwise have been due and payable by
the Borrowers prior to such time; and provided further that no
commitment fee shall accrue on any of the Commitments of a
Defaulting Lender so long as such Lender shall be a Defaulting
Lender.
(b)Letter of Credit Fees, Etc. (i) The Borrowers jointly and
severally agree to pay to the Agent for the account of each
Working Capital A Lender and each Working Capital B-1 Lender a
commission, payable quarterly in arrears on the first Business
Day of each January, April, July and October, commencing October
1, 1996, and on the earliest to occur of the full drawing,
expiration, termination or cancellation of any Letter of Credit
and on the Termination Date, on such Lender's Pro Rata Share of
the average daily aggregate Available Amount during such quarter
of all Letters of Credit issued under the Working Capital A
Facility and Working Capital B-1 Facility, respectively, and
outstanding from time to time at the rate per annum equal to the
Applicable Percentage in effect from time to time.
(ii)Any Borrower giving a Notice of Issuance shall pay to each
Issuing Bank, for its own account, such commissions, issuance
fees, fronting fees, transfer fees and other fees and charges in
connection with the issuance or administration of the requested
Letter of Credit as such Borrower and such Issuing Bank shall
agree.
(c)Agent's Fees. The Borrowers jointly and severally agree to
pay to the Agent for its own account such fees as may from time
to time be agreed between the Borrowers and the Agent.
SECTION 2.09. Conversion of Advances. (a) Optional. Any
Borrower may on any Business Day, upon notice given to the Agent
not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed Conversion and
subject to the provisions of Sections 2.07 and 2.10, Convert all
or any portion of the Advances of one Type made to such Borrower
comprising the same Borrowing into Advances of the other Type;
provided, however, that any Conversion of Eurodollar Rate
Advances into Base Rate Advances shall be made only on the last
day of an Interest Period for such Eurodollar Rate Advances, any
Conversion of Base Rate Advances into Eurodollar Rate Advances
shall be in an amount not less than the minimum amount specified
in Section 2.02(c), no Conversion of any Advances shall result in
more separate Borrowings than permitted under Section 2.02(c) and
each Conversion of Advances comprising part of the same Borrowing
under any Facility shall be made ratably among the Appropriate
Lenders in accordance with their Commitments under such Facility.
Each such notice of Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion,
(ii) the Advances to be Converted and (iii) if such Conversion is
into Eurodollar Rate Advances, the duration of the initial
Interest Period for such Advances. Each notice of Conversion
shall be irrevocable and binding on the Borrower giving such
notice.
(b)Mandatory. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any
Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $5,000,000, such Advances shall
automatically Convert into Base Rate Advances.
(ii)If any Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances made to such
Borrower in accordance with the provisions contained in the
definition of "Interest Period" in Section 1.01, the Agent will
forthwith so notify such Borrower and the Appropriate Lenders,
whereupon each such Eurodollar Rate Advance will automatically,
on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance.
(iii)Upon the occurrence and during the continuance of any Event
of Default, (x) each Eurodollar Rate Advance will automatically,
on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (y) the obligation of the
Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.
SECTION 2.10. Increased Costs, Etc. (a) If, due to either
(i) the introduction of or any change in or in the interpretation
of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other governmental
authority (whether or not having the force of law), there shall
be any increase in the cost to any Lender Party of agreeing to
make or of making, funding or maintaining Eurodollar Rate
Advances or of agreeing to issue or of issuing or maintaining
Letters of Credit or of agreeing to make or of making or
maintaining Letter of Credit Advances (excluding for purposes of
this Section 2.10 any such increased costs resulting from (i)
Taxes or Other Taxes (as to which Section 2.12 shall govern) and
(ii) changes in the basis of taxation of overall net income or
overall gross income by the United States or by the foreign
jurisdiction or state under the laws of which such Lender Party
is organized or has its Applicable Lending Office or any
political subdivision thereof), then the Borrowers jointly and
severally agree to pay from time to time, upon demand by such
Lender Party (with a copy of such demand to the Agent), to the
Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased
cost; provided, however, that, before making any such demand,
each Lender Party agrees to use reasonable efforts (consistent
with its internal policy and legal and regulatory restrictions)
to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the
amount of, such increased cost and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to
such Lender Party. A certificate as to the amount of such
increased cost, submitted to the Borrowers by such Lender Party,
shall be conclusive and binding for all purposes, absent manifest
error.
(b)If any Lender Party determines that either (i) the enactment
of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any law or regulation or
any guideline or request from any central bank or other
governmental authority (whether or not having the force of law)
affects or would affect the amount of capital required or
expected to be maintained by such Lender Party or any corporation
controlling such Lender Party and that the amount of such capital
is increased by or based upon the existence of such Lender
Party's commitment to lend or to issue Letters of Credit
hereunder and other commitments of such type or the issuance or
maintenance of the Letters of Credit (or similar contingent
obligations), then, upon demand by such Lender Party (with a copy
of such demand to the Agent), the Borrowers jointly and severally
agree to pay to the Agent for the account of such Lender Party,
from time to time as specified by such Lender Party, additional
amounts sufficient to compensate such Lender Party in the light
of such circumstances, to the extent that such Lender Party
reasonably determines such increase in capital to be allocable to
the existence of such Lender Party's commitment to lend or to
issue Letters of Credit hereunder or to the issuance or
maintenance of any Letters of Credit; provided, however, that,
before making any such demand, each Lender Party agrees to use
reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such a designation would avoid
the need for, or reduce the amount of, such additional amounts
payable under this subsection (b) and would not, in the
reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party. A certificate as to such
amounts submitted to the Borrowers by such Lender Party shall be
conclusive and binding for all purposes, absent manifest error.
(c)If, with respect to any Eurodollar Rate Advances made or to be
made under any Facility, Appropriate Lenders holding at least 51%
of the Commitments under such Facility notify the Agent that the
Eurodollar Rate for any Interest Period for such Advances will
not adequately reflect the cost to such Lenders of making,
funding or maintaining their Eurodollar Rate Advances for such
Interest Period, the Agent shall forthwith so notify the
Borrowers and the Appropriate Lenders, whereupon (i) each such
Eurodollar Rate Advance under such Facility will automatically,
on the last day of the then existing Interest Period therefor,
Convert into a Base Rate Advance and (ii) the obligation of the
Appropriate Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Agent shall
notify the Borrowers that such Lenders have determined that the
circumstances causing such suspension no longer exist.
(d)Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation of any
law or regulation shall make it unlawful, or any central bank or
other governmental authority shall assert that it is unlawful,
for any Lender or its Eurodollar Lending Office to perform its
obligations hereunder to make Eurodollar Rate Advances or to
continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the
Borrowers through the Agent, (i) each Eurodollar Rate Advance
under each Facility under which such Lender has a Commitment will
automatically, upon such demand, Convert into a Base Rate Advance
and (ii) the obligation of the Appropriate Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be
suspended until the Agent shall notify the Borrowers that such
Lender has determined that the circumstances causing such
suspension no longer exist.
SECTION 2.11. Payments and Computations. (a) Each Borrower
shall make each payment hereunder and under the Notes,
irrespective of any right of counterclaim or set-off (except as
otherwise provided in Section 2.15), not later than 11:00 A.M.
(New York City time) on the day when due in U.S. dollars to the
Agent at the Agent's Account in same day funds. The Agent will
promptly thereafter cause like funds to be distributed (i) if
such payment by such Borrower is in respect of principal,
interest, commitment fees or any other Obligation then payable
hereunder and under the Notes to more than one Lender Party, to
such Lender Parties for the account of their respective
Applicable Lending Offices ratably in accordance with the amounts
of such respective Obligations then payable to such Lender
Parties and (ii) if such payment by such Borrower is in respect
of any Obligation then payable hereunder to one Lender Party, to
such Lender Party for the account of its Applicable Lending
Office, in each case to be applied in accordance with the terms
of this Agreement. Upon its acceptance of an Assignment and
Acceptance and recording of the information contained therein in
the Register pursuant to Section 8.07(d), from and after the
effective date of such Assignment and Acceptance, the Agent shall
make all payments hereunder and under the Notes in respect of the
interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Acceptance
shall make all appropriate adjustments in such payments for
periods prior to such effective date directly between themselves.
(b)If the Agent receives funds for application to the Obligations
under the Loan Documents under circumstances for which the Loan
Documents do not specify the Advances or the Facility to which,
or the manner in which, such funds are to be applied, the Agent
may, but shall not be obligated to, elect to distribute such
funds to each Lender Party ratably in accordance with such Lender
Party's proportionate share of the principal amount of all
outstanding Advances and the Available Amount of all Letters of
Credit then outstanding, in repayment or prepayment of such of
the outstanding Advances or other Obligations owed to such Lender
Party, and for application to such principal installments, as the
Agent shall direct.
(c)Each Borrower hereby authorizes each Lender Party, if and to
the extent payment owed to such Lender Party is not made when due
hereunder or, in the case of a Lender, under the Note held by
such Lender, to charge from time to time against any or all of
such Borrower's accounts with such Lender Party any amount so
due.
(d)All computations of interest based on the Base Rate shall be
made by the Agent on the basis of a year of 365 or 366 days, as
the case may be, and all computations of interest based on the
Eurodollar Rate or the Federal Funds Rate and of fees and Letter
of Credit commissions shall be made by the Agent on the basis of
a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in
the period for which such interest, fees or commissions are
payable. Each determination by the Agent of an interest rate,
fee or commission hereunder shall be conclusive and binding for
all purposes, absent manifest error.
(e)Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment
shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the
computation of payment of interest or commitment fee, as the case
may be; provided, however, that, if such extension would cause
payment of interest on or principal of Eurodollar Rate Advances
to be made in the next following calendar month, such payment
shall be made on the next preceding Business Day.
(f)Unless the Agent shall have received notice from a Borrower
prior to the date on which any payment is due to any Lender Party
hereunder that such Borrower will not make such payment in full,
the Agent may assume that such Borrower has made such payment in
full to the Agent on such date and the Agent may, in reliance
upon such assumption, cause to be distributed to each such Lender
Party on such due date an amount equal to the amount then due
such Lender Party. If and to the extent any Borrower shall not
have so made such payment in full to the Agent, each such Lender
Party shall repay to the Agent forthwith on demand such amount
distributed to such Lender Party together with interest thereon,
for each day from the date such amount is distributed to such
Lender Party until the date such Lender Party repays such amount
to the Agent, at the Federal Funds Rate.
SECTION 2.12. Taxes. (a) Any and all payments by any Borrower
hereunder or under the Notes shall be made, in accordance with
Section 2.11, free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, charges
or withholdings, and all liabilities with respect thereto,
excluding, (i) in the case of each Lender Party and the Agent,
respectively, taxes that are imposed on its overall net income or
the overall net income of its branch by the United States and
taxes that are imposed on its overall net income or the overall
net income of its branch (and franchise taxes imposed in lieu
thereof) by the state or foreign jurisdiction under the laws of
which such Lender Party or the Agent, respectively, is organized
or any political subdivision thereof, (ii) in the case of each
Lender Party, taxes that are imposed on its overall net income
(and franchise taxes imposed in lieu thereof) by the state or
foreign jurisdiction in which the principal office or such Lender
Party's Applicable Lending Office is located or any political
subdivision thereof and (iii) in the case of the Agent, taxes
that are imposed on its overall net income (and franchise taxes
imposed in lieu thereof) by the jurisdiction in which the office
through which the Agent performs its activities hereunder is
located (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities in respect of
payments hereunder or under the Notes being hereinafter referred
to as "Taxes"). If any Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder
or under any Note to any Lender Party or the Agent, (i) the sum
payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable
to additional sums payable under this Section 2.12) such Lender
Party or the Agent (as the case may be) receives an amount equal
to the sum it would have received had no such deductions been
made, (ii) such Borrower shall make such deductions and
(iii) such Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with
applicable law.
(b)In addition, the Borrowers jointly and severally agree to pay
any present or future stamp, documentary, excise, property or
similar taxes, charges or levies that arise from any payment made
hereunder or under the Notes or from the execution, delivery or
registration of, performing under, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other
Taxes").
(c)The Borrowers jointly and severally agree to indemnify each
Lender Party and the Agent for and hold them harmless against the
full amount of Taxes and Other Taxes, and for the full amount of
taxes of any kind imposed by any jurisdiction on amounts payable
under this Section 2.12, imposed on or paid by such Lender Party
or the Agent (as the case may be) and any liability (including
penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be
made within 30 days from the date such Lender Party or the Agent
(as the case may be) makes written demand therefor.
(d)Within 30 days after the date of any payment of Taxes, the
Borrowers shall furnish to the Agent, at its address referred to
in Section 8.02, the original or a certified copy of a receipt
evidencing such payment. In the case of any payment hereunder or
under the Notes by or on behalf of any Borrower through an
account or branch outside the United States or by or on behalf of
any Borrower by a payor that is not a United States person, if
such Borrower determines that no Taxes are payable in respect
thereof, such Borrower shall furnish, or shall cause such payor
to furnish, to the Agent, at such address, an opinion of counsel
acceptable to the Agent stating that such payment is exempt from
Taxes. For purposes of this subsection (d) and subsection (e),
the terms "United States" and "United States person" shall have
the meanings specified in Section 7701 of the Internal Revenue
Code.
(e)Each Lender Party organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each
Initial Lender or Initial Issuing Bank, as the case may be, and
on the date of the Assignment and Acceptance pursuant to which it
becomes a Lender Party in the case of each other Lender Party,
and from time to time thereafter as requested in writing by the
Borrowers (but only so long thereafter as such Lender Party
remains lawfully able to do so), provide each of the Agent and
the Borrowers with two accurate and complete original signed
Internal Revenue Service forms 1001 or 4224 or (in the case of a
Lender Party that is claiming exemption from United States
withholding tax under Section 871(h) or 881(c) of the Internal
Revenue Code with respect to payments of "portfolio interest")
two accurate and complete signed original Forms W-8 (and, if such
Lender Party delivers Forms W-8, two signed certificates
certifying that such Lender Party is not (i) a "bank" for
purposes of Section 881(c) of the Internal Revenue Code, (ii) is
not a 10-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of the Borrower, (iii)
is not a controlled foreign corporation related to the Borrower
(within the meaning of Section 864(d)(4) of the Internal Revenue
Code) and (iv) is not a conduit entity participating in a conduit
financing arrangement (as defined in Treasury Regulation Section
1.881-3), as appropriate, or any successor or other form
prescribed by the Internal Revenue Service, certifying that such
Lender Party is exempt from or entitled to a reduced rate of
United States withholding tax on payments pursuant to this
Agreement or the Notes. If the accurate and complete forms
provided by a Lender Party at the time such Lender Party first
becomes a party to this Agreement indicate a United States
interest withholding tax rate in excess of zero, withholding tax
at such rate shall be considered excluded from Taxes unless and
until such Lender Party provides the appropriate form certifying
that a lesser rate applies, whereupon withholding tax at such
lesser rate only shall be considered excluded from Taxes for
periods governed by such form; provided, however, that, if at the
date of the Assignment and Acceptance pursuant to which a Lender
Party becomes a party to this Agreement, the Lender Party
assignor was entitled to payments under subsection (a) in respect
of United States withholding tax with respect to interest paid at
such date, then, to such extent, the term Taxes shall include (in
addition to withholding taxes that may be imposed in the future
or other amounts otherwise includible in Taxes) United States
withholding tax, if any, applicable with respect to the Lender
Party assignee on such date.
(f)For any period with respect to which a Lender Party has failed
to provide the Borrowers with the appropriate form described in
subsection (e) above (other than if such failure is due to a
change in law occurring after the date on which a form originally
was required to be provided or if such form otherwise is not
required under subsection (e) above), such Lender Party shall not
be entitled to indemnification under subsection (a) or (c) with
respect to Taxes imposed by the United States by reason of such
failure; provided, however, that should a Lender Party become
subject to Taxes because of its failure to deliver a form
required hereunder, the Borrowers shall take such steps, at such
Lender Party's sole expense, as such Lender Party shall
reasonably request to assist such Lender Party to recover such
Taxes.
(g)Any Lender Party claiming any additional amounts payable
pursuant to this Section 2.12 shall use reasonable efforts
(consistent with its internal policy and legal and regulatory
restrictions) to change the jurisdiction of its Applicable
Lending Office if the making of such a change would avoid the
need for, or reduce the amount of, any such additional amount
which may thereafter accrue and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to
such Lender Party.
(h)If the Agent or any Lender Party, in its sole opinion,
determines that it has finally and irrevocably received or been
granted a refund in respect of any Taxes or Other Taxes as to
which indemnification has been paid by Crompton Corp. pursuant to
Section 2.12(a) or (c), it shall promptly remit such refund
(including any interest) to Crompton Corp., net of all out-of-pocket
expenses of the Agent or such Lender Party; provided,
however, that Crompton Corp., upon the request of the Agent or
such Lender Party, agrees promptly to return such refund (plus
any interest) to such party in the event such party is required
to repay such refund to the relevant taxing authority. The Agent
or such Lender Party shall provide Crompton Corp. with a copy of
any notice or assessment from the relevant taxing authority
(deleting any confidential information contained therein)
requiring repayment of such refund. Nothing contained herein
shall impose an obligation on the Agent or any Lender Party to
apply for any refund.
SECTION 2.13. Sharing of Payments, Etc. If any Lender Party
shall obtain at any time any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or
otherwise) (a) on account of Obligations due and payable to such
Lender Party hereunder and under the Notes at such time in excess
of its ratable share (according to the proportion of (i) the
amount of such Obligations due and payable to such Lender Party
at such time to (ii) the aggregate amount of the Obligations due
and payable to all Lender Parties hereunder and under the Notes
at such time) of payments on account of the Obligations due and
payable to all Lender Parties hereunder and under the Notes at
such time obtained by all the Lender Parties at such time or
(b) on account of Obligations owing (but not due and payable) to
such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of
(i) the amount of such Obligations owing to such Lender Party at
such time to (ii) the aggregate amount of the Obligations owing
(but not due and payable) to all Lender Parties hereunder and
under the Notes at such time) of payments on account of the
Obligations owing (but not due and payable) to all Lender Parties
hereunder and under the Notes at such time obtained by all of the
Lender Parties at such time, such Lender Party shall forthwith
purchase from the other Lender Parties such participations in the
Obligations due and payable or owing to them, as the case may be,
as shall be necessary to cause such purchasing Lender Party to
share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender Party, such
purchase from each other Lender Party shall be rescinded and such
other Lender Party shall repay to the purchasing Lender Party the
purchase price to the extent of such Lender Party's ratable share
(according to the proportion of (i) the purchase price paid to
such Lender Party to (ii) the aggregate purchase price paid to
all Lender Parties) of such recovery together with an amount
equal to such Lender Party's ratable share (according to the
proportion of (i) the amount of such other Lender Party's
required repayment to (ii) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or
payable by the purchasing Lender Party in respect of the total
amount so recovered. Each Borrower agrees that any Lender Party
so purchasing a participation from another Lender Party pursuant
to this Section 2.13 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off)
with respect to such participation as fully as if such
Lender Party were the direct creditor of such Borrower in the
amount of such participation.
SECTION 2.14. Use of Proceeds. The proceeds of the Advances and
issuances of Letters of Credit under the Working Capital A
Facility and the Working Capital B-1 Facility shall be available
(and each Borrower agrees that it shall use such proceeds and
Letters of Credit) solely to pay transaction fees and expenses
incurred in connection with the Merger, redeem or repurchase
certain public Existing Debt of Uniroyal Corp. and Uniroyal, and
for other general corporate purposes, including, without
limitation, to finance permitted acquisitions and Capital
Expenditures and provide working capital for the Borrowers and
their respective Subsidiaries; provided that Advances made
pursuant to Section 2.02(g) shall be used by the Uniroyal
Borrower solely for the purpose of satisfying its obligations
under the Seoul Guaranty. The proceeds of the Advances under the
Working Capital B-2 Facility shall be available (and the Uniroyal
Borrower agrees that it shall use such proceeds) solely to
redeem, repurchase or defease, in full or in part, the Uniroyal
Senior Notes, the Uniroyal Corp. Senior Notes, the Uniroyal Corp.
Senior Subordinated Notes and the Uniroyal Corp. Subordinated
Discount Notes.
SECTION 2.15. Defaulting Lenders. (a) In the event that, at
any one time, (i) any Lender Party shall be a Defaulting Lender,
(ii) such Defaulting Lender shall owe a Defaulted Advance to any
Borrower and (iii) such Borrower shall be required to make any
payment hereunder or under any other Loan Document to or for the
account of such Defaulting Lender, then such Borrower may, so
long as no Default shall occur or be continuing at such time and
to the fullest extent permitted by applicable law, set off and
otherwise apply the Obligation of such Borrower to make such
payment to or for the account of such Defaulting Lender against
the obligation of such Defaulting Lender to make such Defaulted
Advance. In the event that, on any date, such Borrower shall so
set off and otherwise apply its Obligation to make any such
payment against the obligation of such Defaulting Lender to make
any such Defaulted Advance on or prior to such date, the amount
so set off and otherwise applied by such Borrower shall
constitute for all purposes of this Agreement and the other Loan
Documents an Advance by such Defaulting Lender made on the date
under the Facility pursuant to which such Defaulted Advance was
originally required to have been made pursuant to Section 2.01.
Such Advance shall be a Base Rate Advance and shall be
considered, for all purposes of this Agreement, to comprise part
of the Borrowing in connection with which such Defaulted Advance
was originally required to have been made pursuant to
Section 2.01, even if the other Advances comprising such
Borrowing shall be Eurodollar Rate Advances on the date such
Advance is deemed to be made pursuant to this subsection (a).
Each Borrower shall notify the Agent at any time such Borrower
exercises its right of set-off pursuant to this subsection (a)
and shall set forth in such notice (A) the name of the Defaulting
Lender and the Defaulted Advance required to be made by such
Defaulting Lender and (B) the amount set off and otherwise
applied in respect of such Defaulted Advance pursuant to this
subsection (a). Any portion of such payment otherwise required
to be made by any Borrower to or for the account of such
Defaulting Lender which is paid by such Borrower, after giving
effect to the amount set off and otherwise applied by such
Borrower pursuant to this subsection (a), shall be applied by the
Agent as specified in subsection (b) or (c) of this Section 2.15.
(b)In the event that, at any one time, (i) any Lender Party shall
be a Defaulting Lender, (ii) such Defaulting Lender shall owe a
Defaulted Amount to the Agent or any of the other Lender Parties
and (iii) any Borrower shall make any payment hereunder or under
any other Loan Document to the Agent for the account of such
Defaulting Lender, then the Agent may, on its behalf or on behalf
of such other Lender Parties and to the fullest extent permitted
by applicable law, apply at such time the amount so paid by such
Borrower to or for the account of such Defaulting Lender to the
payment of each such Defaulted Amount to the extent required to
pay such Defaulted Amount. In the event that the Agent shall so
apply any such amount to the payment of any such Defaulted Amount
on any date, the amount so applied by the Agent shall constitute
for all purposes of this Agreement and the other Loan Documents
payment, to such extent, of such Defaulted Amount on such date.
Any such amount so applied by the Agent shall be retained by the
Agent or distributed by the Agent to such other Lender Parties,
ratably in accordance with the respective portions of such
Defaulted Amounts payable at such time to the Agent and such
other Lender Parties and, if the amount of such payment made by
any Borrower shall at such time be insufficient to pay all
Defaulted Amounts owing at such time to the Agent and the other
Lender Parties, in the following order of priority:
(i)first, to the Agent for any Defaulted Amount then owing to the
Agent; and
(ii)second, to any other Lender Parties for any Defaulted Amounts
then owing to such other Lender Parties, ratably in accordance
with such respective Defaulted Amounts then owing to such other
Lender Parties.
Any portion of such amount paid by any Borrower for the account
of such Defaulting Lender remaining, after giving effect to the
amount applied by the Agent pursuant to this subsection (b),
shall be applied by the Agent as specified in subsection (c) of
this Section 2.15.
(c)In the event that, at any one time, (i) any Lender Party shall
be a Defaulting Lender, (ii) such Defaulting Lender shall not owe
a Defaulted Advance or a Defaulted Amount and (iii) any Borrower,
the Agent or any other Lender Party shall be required to pay or
distribute any amount hereunder or under any other Loan Document
to or for the account of such Defaulting Lender, then such
Borrower or such other Lender Party shall pay such amount to the
Agent to be held by the Agent, to the fullest extent permitted by
applicable law, in escrow or the Agent shall, to the fullest
extent permitted by applicable law, hold in escrow such amount
otherwise held by it. Any funds held by the Agent in escrow
under this subsection (c) shall be deposited by the Agent in an
account with Citibank, in the name and under the control of the
Agent, but subject to the provisions of this subsection (c). The
terms applicable to such account, including the rate of interest
payable with respect to the credit balance of such account from
time to time, shall be Citibank's standard terms applicable to
escrow accounts maintained with it. Any interest credited to
such account from time to time shall be held by the Agent in
escrow under, and applied by the Agent from time to time in
accordance with the provisions of, this subsection (c). The
Agent shall, to the fullest extent permitted by applicable law,
apply all funds so held in escrow from time to time to the extent
necessary to make any Advances required to be made by such
Defaulting Lender and to pay any amount payable by such
Defaulting Lender hereunder and under the other Loan Documents to
the Agent or any other Lender Party, as and when such Advances or
amounts are required to be made or paid and, if the amount so
held in escrow shall at any time be insufficient to make and pay
all such Advances and amounts required to be made or paid at such
time, in the following order of priority:
(i)first, to the Agent for any amount then due and payable by
such Defaulting Lender to the Agent hereunder;
(ii)second, to any other Lender Parties for any amount then due
and payable by such Defaulting Lender to such other Lender
Parties hereunder, ratably in accordance with such respective
amounts then due and payable to such other Lender Parties; and
(iii)third, to such Borrower for any Advance then required to be
made by such Defaulting Lender pursuant to a Commitment of such
Defaulting Lender.
In the event that any Lender Party that is a Defaulting Lender
shall, at any time, cease to be a Defaulting Lender, any funds
held by the Agent in escrow at such time with respect to such
Lender Party shall be distributed by the Agent to such Lender
Party and applied by such Lender Party to the Obligations owing
to such Lender Party at such time under this Agreement and the
other Loan Documents ratably in accordance with the respective
amounts of such Obligations outstanding at such time.
(d)The rights and remedies against a Defaulting Lender under this
Section 2.15 are in addition to other rights and remedies that
the Borrowers may have against such Defaulting Lender with
respect to any Defaulted Advance and that the Agent or any Lender
Party may have against such Defaulting Lender with respect to any
Defaulted Amount.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Extension of
Credit. The obligation of each Lender to make an Advance or of
any Issuing Bank to issue a Letter of Credit on the occasion of
the Initial Extension of Credit hereunder is subject to the
satisfaction of the following conditions precedent before or
concurrently with the Initial Extension of Credit:
(a)The Merger shall have been consummated substantially in
accordance with the terms of the Merger Agreement, without any
waiver or amendment not consented to by the Lender Parties of any
material term, provision or condition set forth therein, and in
material compliance with all applicable laws.
(b)The Merger Agreement shall be in full force and effect.
(c)The Lender Parties shall be satisfied with the corporate and
legal structure and capitalization of each Loan Party and each of
its Subsidiaries, including the terms and conditions of the
charter, bylaws and each class of capital stock of each Loan
Party and each such Subsidiary and of each agreement or
instrument relating to such structure or capitalization.
(d)The Lender Parties shall be satisfied that all Existing Debt,
other than the Debt identified on Schedule 3.01(d) (the
"Surviving Debt"), has been prepaid, redeemed or defeased in full
or otherwise satisfied and extinguished.
(e)There shall have occurred no material adverse change in the
business, condition (financial or otherwise), operations,
performance, properties or prospects of (i) before and after
giving effect to the Merger and the other transactions
contemplated by this Agreement, Crompton Corp. and its
Subsidiaries, taken as a whole, since December 31, 1995, (ii)
after giving effect to the Merger and the other transactions
contemplated by this Agreement, Crompton Corp. and its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries),
taken as a whole, since December 31, 1995 or (iii) before and
after giving effect to the Merger and the other transactions
contemplated by this Agreement, Uniroyal and its Subsidiaries,
taken as a whole, since September 30, 1995.
(f)There shall exist no action, suit, investigation, litigation
or proceeding affecting any Loan Party or any of its Subsidiaries
pending or threatened before any court, governmental agency or
arbitrator that (i) would be reasonably likely to have a Material
Adverse Effect other than the matters described on
Schedule 3.01(f) (the "Disclosed Litigation") or (ii) purports to
affect the legality, validity or enforceability of the Merger,
this Agreement, any Note, any other Loan Document, any Related
Document or the consummation of the transactions contemplated
hereby, and there shall have been no material adverse change in
the status, or financial effect on any Loan Party or any of its
Subsidiaries, of the Disclosed Litigation from that described on
Schedule 3.01(f).
(g)The Lender Parties shall have completed a due diligence
investigation of the Borrowers and their respective Subsidiaries
in scope, and with results, satisfactory to the Lender Parties,
and nothing shall have come to the attention of the Lender
Parties during the course of such due diligence investigation to
lead them to believe (i) that the Information Memorandum was or
has become misleading, incorrect or incomplete in any material
respect, (ii) that, following the consummation of the Merger,
Crompton Corp. and its Subsidiaries would not have good and
marketable title to all material assets of Uniroyal Corp. and its
Subsidiaries reflected in the Information Memorandum and
(iii) that the Merger will have a Material Adverse Effect;
without limiting the generality of the foregoing, the Lender
Parties shall have been given such access to the management,
records, books of account, contracts and properties of the
Borrowers and their respective Subsidiaries as they shall have
requested.
(h)All stock of the Borrowers (other than Crompton Corp.) and the
Borrowers' Subsidiaries, to the extent owned by the Borrowers and
their Subsidiaries, shall be owned by the Borrowers or one or
more of the Borrowers' Subsidiaries, in each case free and clear
of any lien, charge or encumbrance; the Agent shall have a valid
and perfected first priority lien on and security interest in the
Collateral (other than as to matters of perfection and priority
of the security interest in the Pledged Accounts (as defined in
the Uniroyal Security Agreement) and the Other Accounts (as
defined in the Uniroyal Security Agreement)) for the benefit of
the Secured Parties; all filings, recordations and searches
necessary or desirable in connection with such liens and security
interests shall have been duly made; and all filing and recording
fees and taxes shall have been duly paid.
(i)All governmental and third party consents and approvals
(including, without limitation, any consents or approvals
required under the documents relating to the Uniroyal Corp.
Senior Notes and the Uniroyal Corp. Senior Subordinated Notes)
necessary in connection with Loan Documents and the transactions
contemplated thereby (including, without limitation, the Merger)
shall have been obtained (without the imposition of any
conditions that are not reasonably acceptable to the Lender
Parties) and shall remain in effect other than such governmental
or third party consents and approvals the failure to obtain which
shall not (x) be materially adverse to any of the Borrowers, in
each case together with its respective Subsidiaries, taken as a
whole, (y) affect the enforceability, validity or binding effect
of any of the Loan Documents required to be executed and
delivered prior to or on the Effective Date or (z) expose the
Agent or the Lender Parties to personal liability; all applicable
waiting periods shall have expired without any action being taken
by any competent authority; and no law or regulation shall be
applicable in the judgment of the Lender Parties that restrains,
prevents or imposes materially adverse conditions upon the Loan
Documents or the transactions contemplated thereby (including,
without limitation, the Merger).
(j)The Borrowers shall have paid all accrued fees and expenses of
the Agent and the Lender Parties (including the accrued fees and
expenses of counsel to the Agent and local counsel to the Lender
Parties).
(k)The Agent shall have received on or before the day of the
Initial Extension of Credit the following, each dated such day
(unless otherwise specified), in form and substance satisfactory
to the Agent (unless otherwise specified) and (except for the
Notes) in sufficient copies for each Lender Party:
(i)The Notes payable to the order of the Lenders.
(ii)Certified copies of the resolutions of the Board of Directors
of each Borrower, and each other Loan Party approving the Merger,
this Agreement, the Notes, each other Loan Document and each
Related Document to which it is or is to be a party, and of all
documents evidencing other necessary corporate action and
governmental and other third party approvals and consents, if
any, with respect to the Merger, this Agreement, the Notes, each
other Loan Document and each Related Document.
(iii)A copy of a certificate of the Secretary of State of the
jurisdiction of its incorporation, dated reasonably near the date
of the Initial Extension of Credit, listing the charter of each
Borrower and each other Loan Party and each amendment thereto on
file in his office and certifying that (A) such amendments are
the only amendments to such Borrower's or such other Loan Party's
charter on file in his office, (B) each Borrower and each other
Loan Party have paid all franchise taxes to the date of such
certificate and (C) each Borrower and each other Loan Party are
duly incorporated and in good standing under the laws of the
State of the jurisdiction of its incorporation.
(iv)Certified copies of a certificate of merger or other
confirmation from the Secretary of State of the State of Delaware
satisfactory to the Lender Parties of the consummation of the
Merger.
(v)A certificate of each Borrower and each other Loan Party,
signed on behalf of such Borrower or such other Loan Party, as
the case may be, by its President or a Vice President and its
Secretary or any Assistant Secretary, dated the date of the
Initial Extension of Credit (the statements made in which
certificate shall be true on and as of the date of the Initial
Extension of Credit), certifying as to (A) the absence of any
amendments to the charter of such Borrower or such other Loan
Party since the date of the Secretary of State's certificate
referred to in Section 3.01(k)(iii), (B) a true and correct copy
of the bylaws of such Borrower or such other Loan Party as in
effect on the date of the Initial Extension of Credit, (C) the
due incorporation and good standing of such Borrower or such
other Loan Party organized under the laws of the State of its
incorporation, and the absence of any proceeding for the
dissolution or liquidation of such Borrower or such other Loan
Party, (D) the truth of the representations and warranties
contained in the Loan Documents as though made on and as of the
date of the Initial Extension of Credit and (E) the absence of
any event occurring and continuing, or resulting from the Initial
Extension of Credit, that constitutes a Default.
(vi)A certificate of the Secretary or an Assistant Secretary of
each Borrower and each other Loan Party certifying the names and
true signatures of the officers of such Borrower or such other
Loan Party authorized to sign this Agreement, the Notes, each
other Loan Document and each Related Document to which they are
or are to be parties and the other documents to be delivered
hereunder and thereunder.
(vii)A security agreement in substantially the form of Exhibit D-1 (as
amended, supplemented or otherwise modified from time to
time in accordance with its terms, the "Crompton Security
Agreement"), duly executed by each Crompton Borrower and each
Crompton Guarantor, together with:
(A)certificates representing the Pledged Shares referred to
therein accompanied by undated stock powers executed in blank,
and instruments evidencing the Pledged Debt (except as otherwise
provided in Sections 5.02(b)(i)(D) and 5.02(b)(ii)) referred to
therein indorsed in blank,
(B)duly executed proper financing statements, to be filed under
the Uniform Commercial Code of all jurisdictions that the Agent
may deem necessary or desirable in order to perfect and protect
the first priority liens and security interests created under the
Crompton Security Agreement, covering the Collateral described in
the Crompton Security Agreement,
(C)completed requests for information, dated on or before the
date of the Initial Extension of Credit, listing all effective
financing statements filed in the jurisdictions referred to in
clause (B) above that name any Crompton Borrower or any Crompton
Guarantor as debtor, together with copies of such other financing
statements,
(D)evidence of the completion of all other recordings and filings
of or with respect to the Crompton Security Agreement that the
Agent may deem necessary or desirable in order to perfect and
protect the Liens created thereby, and
(E)evidence that all other action that the Agent may deem
necessary or desirable in order to perfect and protect the first
priority liens and security interests created under the Crompton
Security Agreement has been taken.
(viii)A security agreement in substantially the form of
Exhibit D-2 (as amended, supplemented or otherwise modified from
time to time in accordance with its terms, the "Uniroyal Security
Agreement" and, together with the Crompton Security Agreement and
each security agreement delivered pursuant to Section 5.01(k), in
each case as amended, supplemented or otherwise modified from
time to time in accordance with its terms, the "Security
Agreement"), duly executed by the Uniroyal Borrower and each
Uniroyal Guarantor, together with:
(A)duly executed proper financing statements, to be filed on or
before the day of the Initial Extension of Credit under the
Uniform Commercial Code of all jurisdictions that the Agent may
deem necessary or desirable in order to perfect and protect the
first priority liens and security interests created under the
Uniroyal Security Agreement, covering the Collateral described in
the Uniroyal Security Agreement,
(B)completed requests for information, dated on or before the
date of the Initial Extension of Credit, listing all effective
financing statements filed in the jurisdictions referred to in
clause (A) above that name the Uniroyal Borrower or any Uniroyal
Guarantor as debtor, together with copies of such other financing
statements,
(C)evidence of the completion of all other recordings and filings
of or with respect to the Uniroyal Security Agreement that the
Agent may deem necessary or desirable in order to perfect and
protect the Liens created thereby,
(D)evidence of the insurance required by the terms of the
Security Agreement,
(E)instruments evidencing the Pledged Debt (except as otherwise
provided in Sections 5.02(b)(i)(D) and 5.02(b)(ii)) referred to
therein endorsed in blank, and
(F)evidence that all other action that the Agent may deem
necessary or desirable in order to perfect and protect the first
priority liens and security interests created under the Uniroyal
Security Agreement has been taken.
(ix)A guaranty in substantially the form of Exhibit E-1 (as
amended, supplemented or otherwise modified from time to time in
accordance with its terms, the "Parent Guaranty"), duly executed
by Crompton Corp.
(x)A guaranty in substantially the form of Exhibit E-2 (together
with each other guaranty delivered pursuant to Section 5.01(k),
in each case as amended, supplemented or otherwise modified from
time to time in accordance with its terms, the "Subsidiary
Guaranty"), duly executed by each Subsidiary Guarantor.
(xi)Certified copies of each of the Related Documents, duly
executed by the parties thereto and in form and substance
satisfactory to the Lender Parties, together with all agreements,
instruments and other documents delivered in connection
therewith.
(xii)Such financial, business and other information regarding
each Loan Party and its Subsidiaries as the Lender Parties shall
have requested, including, without limitation, information as to
possible contingent liabilities, tax matters, environmental
matters, obligations under Plans, Multiemployer Plans and Welfare
Plans, collective bargaining agreements and other arrangements
with employees, audited annual financial statements of Crompton
Corp. and its Subsidiaries (other than Uniroyal Corp. and its
Subsidiaries) dated December 30, 1995, audited annual financial
statements of Uniroyal Corp. and its Subsidiaries dated
October 1, 1995, interim financial statements dated the end of
the most recent fiscal quarter for which financial statements are
available, pro forma financial statements as to Crompton Corp.
and its Subsidiaries after giving effect to the Merger and the
other transactions, on a Consolidated basis, of balance sheets,
income statements and cash flow statements for the one-year
period ended on or about March 31, 1996 and forecasts prepared by
management of the Borrowers, in form and substance satisfactory
to the Lender Parties, on a Consolidated basis and, to the extent
otherwise available, on a Consolidating basis, of balance sheets,
income statements and cash flow statements for the first year
following January 1, 1996 and on an annual basis for each year
thereafter until the Termination Date.
(xiii)Certificates, in substantially the form of Exhibit G,
attesting to the Solvency of each Loan Party after giving effect
to the Merger and the other transactions contemplated hereby,
from its chief financial officer.
(xiv) A supplement to the Uniroyal Security Agreement in respect
of Collateral located in the State of Louisiana in substantially
the form of Exhibit D-3 (as amended, supplemented or otherwise
modified from time to time in accordance with its terms, the
"Louisiana Undertaking"), duly executed by the Uniroyal Borrower
and the Uniroyal Guarantors.
(xv)An environmental assessment report, in form and substance
satisfactory to the Lender Parties, from Environmental Safety and
Designs, Inc., as to any hazards, costs or liabilities under
Environmental Laws to which any Loan Party or any of its
Subsidiaries may be subject, the amount and nature of which and
the Borrowers' plans with respect to which shall be acceptable to
the Lender Parties, together with evidence, in form and substance
satisfactory to the Lender Parties, that all Environmental Laws
applicable to the consummation of the Merger shall have been
materially complied with.
(xvi)A letter, in form and substance satisfactory to the Agent,
from Crompton Corp. to KPMG Peat Marwick LLP, its independent
certified public accountants, advising such accountants that the
Agent and the Lender Parties have been authorized to exercise all
rights of the Borrowers to require such accountants to disclose
any and all financial statements and any other information of any
kind that they may have with respect to the Borrowers and their
respective Subsidiaries and directing such accountants to comply
with any reasonable request of the Agent or any Lender Party for
such information; provided that all requests for such information
shall be provided through Crompton Corp.
(xvii)A favorable opinion of Wachtell, Lipton, Xxxxx & Xxxx,
special counsel for the Loan Parties, in substantially the form
of Exhibit F-1 hereto and as to such other matters as any Lender
Party through the Agent may reasonably request.
(xviii)A favorable opinion of Xxxx X. Xxxxxxxx, XX, Esq., General
Counsel and Corporate Secretary of Crompton Corp. and its
Subsidiaries, in substantially the form of Exhibit F-2 hereto and
as to such other matters as any Lender Party through the Agent
may reasonably request.
(xix)A favorable opinion of Xxxx X. Xxxxxxxx, XX, Esq., General
Counsel and Corporate Secretary of Crompton Corp. and its
Subsidiaries, in substantially the form of Exhibit F-3 hereto and
as to such other matters as any Lender Party through the Agent
may reasonably request.
(xx)A favorable opinion of local counsel to the Loan Parties or
Lender Parties, as the case may be, listed on Schedule
3.01(k)(xx) in the jurisdictions listed on Schedule 3.01(k)(xx)
in form and substance satisfactory to the Agent and as to such
other matters as any Lender Party through the Agent may
reasonably request.
(xxi)A favorable opinion of Shearman & Sterling, counsel for the
Agent, in form and substance satisfactory to the Agent.
SECTION 3.02. Conditions Precedent to Each Borrowing and
Issuance. The right of the Borrowers to request and the
obligation of each Appropriate Lender to make an Advance (other
than a Letter of Credit Advance made by an Issuing Bank or a
Working Capital Lender pursuant to Section 2.03(c) and a Swing
Line Advance made by a Working Capital Lender pursuant to
Section 2.02(b)) on the occasion of each Borrowing (including the
Initial Extension of Credit), and the right of the Borrowers to
request and the obligation of each Issuing Bank to issue a Letter
of Credit (including the initial issuance) and the right of the
Borrowers to request a Swing Line Borrowing, shall be subject to
the further conditions precedent that on the date of such
Borrowing or issuance (a) the following statements shall be true
(and each of the giving of the applicable Notice of Borrowing,
Notice of Swing Line Borrowing or Notice of Issuance and the
acceptance by the relevant Borrower of the proceeds of such
Borrowing or of such Letter of Credit shall constitute a
representation and warranty by such Borrower that both on the
date of such notice and on the date of such Borrowing or issuance
such statements are true):
(i)the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after
giving effect to such Borrowing or issuance and to the
application of the proceeds therefrom, as though made on and as
of such date other than any such representations or warranties
that, by their terms, refer to a specific date other than the
date of such Borrowing or issuance, in which case as of such
specific date; and
(ii)no event has occurred and is continuing, or would result from
such Borrowing or issuance or from the application of the
proceeds therefrom, that constitutes a Default;
and (b) the Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender through the Agent
may reasonably request.
SECTION 3.03. Determinations Under Section 3.01. For purposes
of determining compliance with the conditions specified in
Section 3.01, each Lender Party shall be deemed to have consented
to, approved or accepted or to be satisfied with each document or
other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to the Lender Parties unless an
officer of the Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice
from such Lender Party prior to the Initial Extension of Credit
specifying its objection thereto and, if the Initial Extension of
Credit consists of a Borrowing, such Lender Party shall not have
made available to the Agent such Lender Party's ratable portion
of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrowers.
Each Borrower represents and warrants as follows:
(a)Each Loan Party (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction
of its incorporation, (ii) is duly qualified and in good standing
as a foreign corporation in each other jurisdiction in which it
owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed except where the failure
to so qualify or be licensed would not have a Material Adverse
Effect and (iii) has all requisite corporate power and authority
(including, without limitation, all governmental licenses,
permits and other approvals) to own or lease and operate its
properties and to carry on its business as now conducted and as
proposed to be conducted. All of the outstanding capital stock
of the Borrowers has been validly issued and is fully paid and
non-assessable.
(b)Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party as of the
date hereof, showing as of the date hereof (as to each such
Subsidiary) the jurisdiction of its incorporation, the number of
shares of each class of capital stock authorized, and the number
outstanding, on the date hereof and the percentage of the
outstanding shares of each such class owned (directly or
indirectly) by such Loan Party and the number of shares covered
by all outstanding options, warrants, rights of conversion or
purchase and similar rights at the date hereof. All of the
outstanding capital stock of all of such Subsidiaries to the
extent owned by the Borrowers and their Subsidiaries has been
validly issued, is fully paid and non-assessable and is owned by
such Loan Party or one or more of its Subsidiaries free and clear
of all Liens, except those created under the Loan Documents.
Each such Subsidiary (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction
of its incorporation, (ii) is duly qualified and in good standing
as a foreign corporation in each other jurisdiction in which it
owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed except where the failure
to so qualify or be licensed would not have a Material Adverse
Effect and (iii) has all requisite corporate power and authority
(including, without limitation, all governmental licenses,
permits and other approvals) to own or lease and operate its
properties and to carry on its business as now conducted and as
proposed to be conducted.
(c)The execution, delivery and performance by each Loan Party of
this Agreement, the Notes, each other Loan Document and each
Related Document to which it is or is to be a party, and the
consummation of the Merger and the other transactions
contemplated hereby, are within such Loan Party's corporate
powers, have been duly authorized by all necessary corporate
action, and do not (i) contravene such Loan Party's charter or
bylaws, (ii) violate any law, rule, regulation (including,
without limitation, Regulation X of the Board of Governors of the
Federal Reserve System), order, writ, judgment, injunction,
decree, determination or award, (iii) conflict with or result in
the breach of, or constitute a default under, any loan agreement,
indenture, mortgage, deed of trust or other instrument or
material contract or material lease binding on or affecting any
Loan Party, any of its Subsidiaries or any of their properties or
(iv) except for the Liens created under the Loan Documents,
result in or require the creation or imposition of any Lien upon
or with respect to any of the properties of any Loan Party or any
of its Subsidiaries. No Loan Party or any of its Subsidiaries is
in violation of any such law, rule, regulation, order, writ,
judgment, injunction, decree, determination or award or in breach
of any such loan agreement, indenture, mortgage, deed of trust or
other instrument or material contract or material lease, the
violation or breach of which would have a Material Adverse
Effect.
(d)No authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of
this Agreement, the Notes, any other Loan Document or any Related
Document to which it is or is to be a party, or for the
consummation of the Merger or the other transactions contemplated
hereby, (ii) the grant by any Loan Party of the Liens granted by
it pursuant to the Collateral Documents, (iii) the perfection or
maintenance of the Liens created by the Collateral Documents
(including the first priority nature thereof) or (iv) the
exercise by the Agent or any Lender Party of its rights under the
Loan Documents or the remedies in respect of the Collateral
pursuant to the Collateral Documents, except for the
authorizations, approvals, actions, notices and filings listed on
Schedule 4.01(d), all of which have been duly obtained, taken,
given or made and are in full force and effect. All applicable
waiting periods in connection with the Merger and the other
transactions contemplated hereby have expired without any action
having been taken by any competent authority restraining,
preventing or imposing materially adverse conditions upon the
Merger or the rights of the Loan Parties or their Subsidiaries
freely to transfer or otherwise dispose of, or to create any Lien
on, any properties now owned or hereafter acquired by any of
them.
(e)This Agreement has been, and each of the Notes, each other
Loan Document and each Related Document when delivered hereunder
will have been, duly executed and delivered by each Loan Party
party thereto. This Agreement is, and each of the Notes, each
other Loan Document and each Related Document when delivered
hereunder will be, the legal, valid and binding obligation of
each Loan Party party thereto, enforceable against such Loan
Party in accordance with its terms.
(f)The Consolidated balance sheet of Crompton Corp. and its
Subsidiaries as at December 30, 1995, and the related
Consolidated statement of income and Consolidated statement of
cash flows of Crompton Corp. and its Subsidiaries for the fiscal
year then ended, accompanied by an opinion of KPMG Peat Marwick
LLP, independent public accountants, and the Consolidated balance
sheet of Crompton Corp. and its Subsidiaries as at March 30,
1996, and the related Consolidated statement of income and
Consolidated statement of cash flows of Crompton Corp. and its
Subsidiaries for the three months then ended, duly certified by
the chief financial officer of Crompton Corp., copies of which
have been furnished to each Lender Party, fairly present,
subject, in the case of said balance sheet as at March 30, 1996,
and said statements of income and cash flows for the three months
then ended, to year-end audit adjustments, the Consolidated
financial condition of Crompton Corp. and its Subsidiaries as at
such dates and the Consolidated results of operations of Crompton
Corp. and its Subsidiaries for the periods ended on such dates,
all in accordance with generally accepted accounting principles
applied on a consistent basis, and since December 30, 1995, there
has been no Material Adverse Change.
(g)The Consolidated balance sheet of Uniroyal Corp. and its
Subsidiaries as at October 1, 1995, and the related Consolidated
statement of income and Consolidated statement of cash flows of
Uniroyal Corp. and its Subsidiaries for the fiscal year then
ended, accompanied by an opinion of Deloitte & Touche LLP,
independent public accountants, and the Consolidated balance
sheet of Uniroyal Corp. and its Subsidiaries as at March 31,
1996, and the related Consolidated statement of income and
Consolidated statement of cash flows of Uniroyal Corp. and its
Subsidiaries for the six months then ended, duly certified by the
chief financial officer of Uniroyal Corp., copies of which have
been furnished to each Lender Party, fairly present, subject, in
the case of said balance sheet as at March 31, 1996, and said
statements of income and cash flows for the six months then
ended, to year-end audit adjustments, the Consolidated financial
condition of Uniroyal Corp. and its Subsidiaries as at such date
and the Consolidated results of operations of Uniroyal Corp. and
its Subsidiaries for the period ended on such dates, all in
accordance with generally accepted accounting principles applied
on a consistent basis, and since October 1, 1995, there has been
no Material Adverse Change.
(h)The Consolidated pro forma balance sheet of Crompton Corp. and
its Subsidiaries and the related Consolidated pro forma
statements of income and cash flows of Crompton Corp. and its
Subsidiaries, in each case contained in the Proxy Statement dated
July 23, 1996, copies of which have been furnished to each Lender
Party, fairly present the Consolidated pro forma financial
condition of Crompton Corp. and its Subsidiaries as at such date
and the Consolidated pro forma results of operations of Crompton
Corp. and its Subsidiaries for the period ended on such date, in
each case giving effect to the Merger and the other transactions
contemplated hereby.
(i)The Consolidated and consolidating forecasted balance sheets,
income statements and cash flows statements of Crompton Corp. and
its Subsidiaries delivered to the Lender Parties pursuant to
Section 3.01(k)(xii) or 5.03 were prepared in good faith on the
basis of the assumptions stated therein, which assumptions were
fair in the light of conditions existing at the time of delivery
of such forecasts, and represented, at the time of delivery,
Crompton Corp.'s good faith estimate of its future financial
performance.
(j)Neither the Information Memorandum nor any other information,
exhibit or report furnished by any Loan Party to the Agent or any
Lender Party in connection with the negotiation of the Loan
Documents or pursuant to the terms of the Loan Documents
contained any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements made
therein not misleading.
(k)There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries,
including any Environmental Action, pending or threatened before
any court, governmental agency or arbitrator that (i) would be
reasonably likely to have a Material Adverse Effect (other than
the Disclosed Litigation) or (ii) purports to affect the
legality, validity or enforceability of the Merger, this
Agreement, any Note, any other Loan Document or any Related
Document or the consummation of the transactions contemplated
hereby, and there has been no material adverse change in the
status, or financial effect on any Loan Party or any of its
Subsidiaries, of the Disclosed Litigation from that described on
Schedule 3.01(f).
(l)No proceeds of any Advance or drawings under any Letter of
Credit will be used to acquire any equity security of a class
that is registered pursuant to Section 12 of the Securities
Exchange Act of 1934.
(m)No Borrower is engaged in the business of extending credit for
the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance or drawings under any Letter of Credit
will be used to purchase or carry any Margin Stock or to extend
credit to others for the purpose of purchasing or carrying any
Margin Stock.
(n)(i) No ERISA Event has occurred or is reasonably expected to
occur with respect to any Plan that has had or is reasonably
expected to have a Material Adverse Effect.
(ii)Schedule B (Actuarial Information) to the most recent annual
report (Form 5500 Series) for each Plan, copies of which have
been filed with the Internal Revenue Service and furnished to the
Lender Parties, is complete and accurate and fairly presents the
funding status of such Plan, and since the date of such Schedule
B there has been no material adverse change in such funding
status.
(iii)Neither any Loan Party nor any ERISA Affiliate has incurred
or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan that has had or is reasonably expected to
have a Material Adverse Effect.
(iv)Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or has been terminated,
within the meaning of Title IV of ERISA, and no such
Multiemployer Plan is reasonably expected to be in reorganization
or to be terminated, within the meaning of Title IV of ERISA
which, in either event, has had or is reasonably expected to have
a Material Adverse Effect.
(o)(i) Except as disclosed in Part I of Schedule 4.01(o) hereto,
the operations and properties of each Loan Party and each of its
Subsidiaries comply in all material respects with all applicable
Environmental Laws and Environmental Permits, all past non-compliance
with such Environmental Laws and Environmental Permits
has been resolved without material ongoing obligations or costs,
and no circumstances exist that would be reasonably likely to
(i) form the basis of an Environmental Action against any Loan
Party or any of its Subsidiaries or any of their properties that
could have a Material Adverse Effect or (ii) cause any such
property to be subject to any material restrictions on ownership,
occupancy, use or transferability under any Environmental Law in
effect on the date hereof.
(ii)Except as disclosed in Part II of Schedule 4.01(o) hereto or
as would not, individually or in the aggregate, result in a
Material Adverse Effect, none of the properties currently or
formerly owned or operated by any Loan Party or any of its
Subsidiaries is listed or, to the best knowledge of any Loan
Party, proposed for listing on the NPL or on the CERCLIS or any
analogous foreign, state or local list or is adjacent to any such
property; there are no and never have been any underground or
aboveground storage tanks or any surface impoundments, septic
tanks, pits, sumps or lagoons in which Hazardous Materials are
being or have been treated, stored or disposed on any property
currently owned or operated by any Loan Party or any of its
Subsidiaries or, to the best of its knowledge, on any property
formerly owned or operated by any Loan Party or any of its
Subsidiaries; there is no asbestos or asbestos-containing
material on any property currently owned or operated by any Loan
Party or any of its Subsidiaries; and Hazardous Materials have
not been released, discharged or disposed of on any property
currently or formerly owned or operated by any Loan Party or any
of its Subsidiaries.
(iii)Except as disclosed in Part III of Schedule 4.01(o) hereto,
neither any Loan Party nor any of its Subsidiaries is
undertaking, and has not completed, either individually or
together with other potentially responsible parties, any
investigation or assessment or remedial or response action
relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or
operation, either voluntarily or pursuant to the order of any
governmental or regulatory authority or the requirements of any
Environmental Law; and all Hazardous Materials generated, used,
treated, handled or stored at, or transported to or from, any
property currently or formerly owned or operated by any Loan
Party or any of its Subsidiaries have been disposed of in a
manner not reasonably expected to result in material liability to
any Loan Party or any of its Subsidiaries.
(p)The Collateral Documents create a valid and, upon the making
of the filings referred to in Section 5.01(l), perfected first
priority interest in the Collateral (other than as to matters of
perfection and priority of the security interest in the Pledged
Accounts (as defined in the Uniroyal Security Agreement) and the
Other Accounts (as defined in the Uniroyal Security Agreement)),
securing the payment of the Secured Obligations (as defined in
the Collateral Documents), and all filings and other actions
necessary or desirable to perfect and protect such security
interest have been duly taken except, during the period
immediately following the Effective Date specified in Section
5.01(l) the filings and other actions referred to in Section
5.01(l). The Loan Parties are the legal and beneficial owners of
the Collateral free and clear of any Lien, except for the liens
and security interests created or permitted under the Loan
Documents.
(q)The Merger will not be taxable to any Loan Party or any of its
Subsidiaries or Affiliates.
(r)Neither any Loan Party nor any of its Subsidiaries is an
"investment company," or an "affiliated person" of, or "promoter"
or "principal underwriter" for, an "investment company," as such
terms are defined in the Investment Company Act of 1940, as
amended. Neither the making of any Advances, nor the issuance of
any Letters of Credit, nor the application of the proceeds or
repayment thereof by any Borrower, nor the consummation of the
other transactions contemplated hereby, will violate any
provision of such Act or any rule, regulation or order of the
Securities and Exchange Commission thereunder.
(s)Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(t)Set forth on Schedule 4.01(t) hereto is a complete and
accurate list of all Existing Debt (other than Surviving Debt),
showing as of the date hereof the principal amount outstanding
thereunder.
(u)Set forth on Schedule 3.01(d) hereto is a complete and
accurate list of all Surviving Debt, showing as of the date
hereof the principal amount outstanding thereunder.
(v)The aggregate revenues of the Minor Subsidiaries (other than
Crompton and Xxxxxxx I.P.R. Corporation), on a Consolidated
basis, do not exceed $250,000 for the twelve-month period ending
on the last day of the most recent fiscal quarter of Crompton
Corp., and the aggregate book value of the assets of the Minor
Subsidiaries (other than Crompton and Xxxxxxx I.P.R.
Corporation), on a Consolidated basis, as at the end of the most
recent fiscal quarter of Crompton Corp. does not exceed $250,000.
(w)Set forth on Schedule 4.01(w) hereto is a complete and
accurate list of all Material Subsidiaries existing as of the
date hereof.
(x)Crompton and Xxxxxxx I.P.R. Corporation does not conduct any
business or engage in any activity and has no material assets
other than an intercompany receivable in an amount that does not
exceed $33,000,000.
ARTICLE V
COVENANTS OF THE BORROWERS
SECTION 5.01. Affirmative Covenants. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or
any Lender Party shall have any Commitment hereunder, each
Borrower will:
(a)Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all
applicable laws, rules, regulations and orders, such compliance
to include, without limitation, compliance with ERISA and the
Racketeer Influenced and Corrupt Organizations Chapter of the
Organized Crime Control Act of 1970, except, in any case, where
the failure so to comply, either individually or in the
aggregate, could not be reasonably expected to have a Material
Adverse Effect and would not be reasonably likely to subject any
Loan Party or any of its Subsidiaries to any criminal penalties
or any Lender Party to any civil or criminal penalties.
(b)Payment of Taxes, Etc. Pay and discharge, and cause each of
its Subsidiaries to pay and discharge, before the same shall
become delinquent, (i) all federal income and other material
taxes, assessments and governmental charges or levies imposed
upon it or upon its property and (ii) all lawful claims that, if
unpaid, might by law become a Lien upon its property; provided,
however, that neither any Borrower nor any of its Subsidiaries
shall be required to pay or discharge any such tax, assessment,
charge or claim (x) that is being contested in good faith and by
proper proceedings and as to which appropriate reserves are being
maintained or (y) in respect of which the Lien resulting
therefrom, if any, attaches to its property and becomes
enforceable against its other creditors, to the extent that the
aggregate amount of all such taxes, assessments, charges or
claims does not exceed $3,000,000.
(c)Maintenance of Insurance. Maintain (or maintain on behalf of
each of its Subsidiaries), and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks
as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which
such Borrower or such Subsidiary operates; it being understood
and agreed that Crompton Corp. and its Subsidiaries may self-insure to
the extent consistent with prudent business practice.
(d)Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries (other than any
Minor Subsidiary) to preserve and maintain, its existence, legal
structure, legal name, rights (charter and statutory), permits,
licenses, approvals, privileges and franchises; provided,
however, that such Borrower and its Subsidiaries may consummate
the Merger and any other merger or consolidation permitted under
Section 5.02(d); provided further that neither any Borrower nor
any of its Subsidiaries shall be required to preserve any legal
structure, legal name, right, permit, license, approval,
privilege or franchise if such Borrower or such Subsidiary shall
determine that the preservation thereof is no longer desirable in
the conduct of the business of such Borrower or such Subsidiary,
as the case may be, and that the loss thereof is not
disadvantageous in any material respect to such Borrower, such
Subsidiary or the Lender Parties or, with respect to permits,
licenses, approvals, privileges and franchises, that the loss
thereof could not be reasonably expected to have a Material
Adverse Effect; provided still further that, prior to the
Collateral Release Date, if any Borrower or any of its
Subsidiaries shall determine not to preserve any legal structure
or legal name (to the extent permitted under the immediately
preceding proviso), the Borrowers and their Subsidiaries shall
take such action (within such time as may be required under the
Collateral Documents or under the Uniform Commercial Code (as
defined in the Security Agreement)) as the Agent may deem
necessary or desirable to perfect and protect the Liens created
under the Collateral Documents.
(e)Visitation Rights. At any reasonable time and from time to
time, during regular business hours and upon reasonable prior
notice, permit the Agent or any of the Lender Parties or any
agents or representatives thereof, to examine and make copies of
and abstracts from the records (other than (i) records subject to
attorney-client privilege or confidentiality agreements and (ii)
records relating to trade secrets) and books of account of, and
visit the properties of, any Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts
of any Borrower and any of its Subsidiaries with any of their
respective officers or directors and with their independent
certified public accountants and authorize and direct such
accountants to disclose to the Agent or any of the Lender Parties
any and all financial statements and other information of any
kind that they may have with respect to any Borrower and any of
its Subsidiaries.
(f)Keeping of Books. Keep, and cause each of its Subsidiaries to
keep, proper books of record and account, in which full and
correct entries shall be made of all financial transactions and
the assets and business of such Borrower and each such Subsidiary
in accordance with generally accepted accounting principles in
effect from time to time.
(g)Maintenance of Properties, Etc. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of
its properties that are used or useful in the conduct of its
business in good working order and condition, ordinary wear and
tear excepted, except where the failure to do so, either
individually or in the aggregate, could not be reasonably
expected to have a Material Adverse Effect.
(h)Compliance with Terms of Leaseholds. Make all payments and
otherwise perform all obligations in respect of all leases of
real property to which such Borrower or any of its Subsidiaries
is a party, keep such leases in full force and effect and not
allow such leases to lapse or be terminated or any rights to
renew such leases to be forfeited or cancelled, notify the Agent
of any default by any party with respect to such leases and
cooperate with the Agent in all respects to cure any such
default, and cause each of its Subsidiaries to do so, except, in
any case, where the failure to do so, either individually or in
the aggregate, would not be reasonably likely to have a Material
Adverse Effect.
(i)Performance of Related Documents. Perform and observe all of
the terms and provisions of each Related Document to be performed
or observed by it, maintain each such Related Document in full
force and effect, enforce such Related Document in accordance
with its terms, take all such action to such end as may be from
time to time requested by the Agent and, upon request of the
Agent, make to each other party to each such Related Document
such demands and requests for information and reports or for
action as such Borrower is entitled to make under such Related
Document, and cause each of its Subsidiaries to do so, except, in
any case, where the failure to do so, either individually or in
the aggregate, could not be reasonably expected to have a
Material Adverse Effect.
(j)Transactions with Affiliates. Conduct, and cause each of its
Subsidiaries to conduct, all transactions otherwise permitted
under the Loan Documents with any of their Affiliates other than
wholly owned Subsidiaries (except the Minor Subsidiaries) of
Crompton Corp. on terms which have been determined by the
applicable Borrower's board of directors or such Subsidiary's
board of directors, board of trustees or managing partners, as
the case may be, to be at least as favorable to the Borrowers as
would be obtainable on an arm's length basis at the time of such
transaction for a comparable transaction with a Person who is not
an Affiliate; provided, however, the foregoing restriction shall
not apply to (i) the execution by Crompton Corp. and certain of
its Subsidiaries of, and payments by Crompton Corp. and any of
its Subsidiaries pursuant to, the Tax Agreement, (ii) the payment
of reasonable and customary fees to members of the board of
directors of Crompton Corp. or any of its Subsidiaries who are
not employees of Crompton Corp. or any of its Subsidiaries,
(iii) loans and advances to officers, directors and employees of
Crompton Corp. or any of its Subsidiaries for travel,
entertainment, moving and other relocation expenses made in the
ordinary course of business to the extent otherwise permitted
hereunder, (iv) subject to the provisions of this Agreement, any
transaction between or among Crompton Corp. and any of its wholly
owned Subsidiaries or between Uniroyal and Premier Chemical
Company, Ltd. (so long as Premier Chemical Company, Ltd. remains
at least 80% owned, directly or indirectly, by Crompton Corp.),
(v) payment by Crompton Corp. and its Subsidiaries of ordinary
and customary compensation to their respective employees in the
ordinary course of business, (vi) any dividends or other
distributions permitted by Section 5.02(g), (vii) transactions
with Monochem, Inc. and Rubicon Inc. on terms that are customary
in the ordinary course of business of Uniroyal and its
Subsidiaries as currently practiced, (viii) a Receivables
Securitization and (ix) transactions in addition to those
permitted by the foregoing clauses of this subsection (j) which
in the aggregate involve amounts not in excess of $500,000 per
year.
(k) Covenant to Guarantee Obligations and Give Security. (i) At
such time as any new direct or indirect Material Subsidiaries of
any Loan Party are formed or acquired by such Loan Party or at
such time as any Minor Subsidiary shall have revenues which
exceed $250,000 for the twelve-month period ending on the last
day of the most recent fiscal quarter of Crompton Corp. or the
aggregate book value of the assets of such Minor Subsidiary, as
at the end of the most recent fiscal quarter of Crompton Corp.
exceeds $250,000, in each case to the extent not prohibited by
the terms of the Uniroyal Indentures then in effect and at the
expense of the Borrowers, within 30 days after such formation or
acquisition, cause each such Material Subsidiary (other than any
Foreign Subsidiary) or each such Minor Subsidiary, as the case
may be, and cause each direct and indirect parent (other than the
Borrowers and any Foreign Subsidiary) of such Material Subsidiary
or each such Minor Subsidiary, as the case may be, (if it has not
already done so), to duly execute and deliver to the Agent a
guaranty, in form and substance satisfactory to the Agent,
guaranteeing the other Loan Parties' Obligations under the Loan
Documents;
(ii) At any time prior to the Collateral Release Date, at such
time as any new direct or indirect Material Subsidiaries of any
Loan Party are formed or acquired by such Loan Party or at such
time as any Minor Subsidiary shall have revenues which exceed
$250,000 for the twelve-month period ending on the last day of
the most recent fiscal quarter of Crompton Corp. or the aggregate
book value of the assets of such Minor Subsidiary, as at the end
of the most recent fiscal quarter of Crompton Corp. exceeds
$250,000, in each case to the extent not prohibited by the terms
of the Uniroyal Indentures then in effect and at the expense of
the Borrowers, within 30 days after such formation or
acquisition, duly execute and deliver, and cause each such
Material Subsidiary (other than any Foreign Subsidiary) or each
such Minor Subsidiary, as the case may be, and each direct and
indirect parent of such Material Subsidiary or each such Minor
Subsidiary, as the case may be, (other than any Foreign
Subsidiary except to the extent provided in the proviso below),
if it has not already done so, to duly execute and deliver, to
the Agent, in the case of Crompton Corp. or any of its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries),
pledge agreements (pledging the capital stock of its
Subsidiaries, except to the extent provided in the proviso below)
and, in the case of any direct or indirect Subsidiary of Uniroyal
Corp., security agreements (granting a security interest in
Inventory and Receivables), as specified by and in form and
substance satisfactory to the Agent, securing payment of all the
Obligations of such Borrower, such Subsidiary or such parent, as
the case may be, under the Loan Documents and constituting Liens
on all such properties; provided that with respect to the pledge
of the capital stock of any Foreign Subsidiary, such pledge shall
cover not more than 66% of the outstanding capital stock of such
Foreign Subsidiary if it is directly owned by a Loan Party and
not cover any of the outstanding capital stock of such Foreign
Subsidiary if it is directly or indirectly owned by another
Foreign Subsidiary;
(iii) At any time prior to the Collateral Release Date, upon the
request of the Agent following the occurrence and during the
continuance of an Event of Default, in each case to the extent
not prohibited by the terms of the Uniroyal Indentures then in
effect and at the expense of the Borrowers:
(A)within 30 days after such request, duly execute and deliver,
and cause each of its Subsidiaries (other than any Foreign
Subsidiary) and each direct and indirect parent of such
Subsidiary (if it has not already done so) (other than any
Foreign Subsidiary except to the extent required in the proviso
below) to duly execute and deliver, to the Agent mortgages,
pledges, assignments and other security agreements, as specified
by and in form and substance satisfactory to the Agent, securing
payment of all the Obligations of such Borrower, such Subsidiary
or such parent, as the case may be, under the Loan Documents and
constituting Liens on all such properties; provided that with
respect to the pledge of the capital stock of any Foreign
Subsidiary, such pledge shall cover not more than 66% of the
outstanding capital stock of such Foreign Subsidiary if it is
directly owned by a Loan Party and not cover any of the
outstanding capital stock of such Foreign Subsidiary if it is
directly or indirectly owned by another Foreign Subsidiary; and
(B)within 30 days after such request, take, and cause such
Subsidiary (other than any Foreign Subsidiary) or such parent
(other than any Foreign Subsidiary) to take, whatever action
(including, without limitation, the recording of mortgages, the
filing of Uniform Commercial Code financing statements, the
giving of notices and the endorsement of notices on title
documents) may be necessary or advisable in the opinion of the
Agent to vest in the Agent (or in any representative of the Agent
designated by it) valid and subsisting Liens on the properties
purported to be subject to the mortgages, pledges, assignments
and security agreements delivered pursuant to this
Section 5.01(k), enforceable against all third parties in
accordance with their terms;
(iv)Within 60 days after such formation, acquisition or request,
deliver to the Agent, upon the request of the Agent in its sole
discretion, a signed copy of a favorable opinion, addressed to
the Agent and the other Secured Parties, of counsel for the Loan
Parties acceptable to the Agent as to the guaranties, mortgages,
pledges, assignments and security agreements referred to in
clauses (i), (ii) and (iii) above being the legal, valid and
binding obligations of each Loan Party party thereto enforceable
in accordance with their terms and as to such other matters as
the Agent may reasonably request; and
(v)At any time and from time to time, promptly execute and
deliver any and all further instruments and documents and take
all such other action as the Agent may deem necessary or
desirable in obtaining the full benefits of, or in perfecting and
preserving the Liens of, the guaranties, mortgages, pledges,
assignments and security agreements referred to in clauses (i),
(ii) and (iii) above.
(l)Conditions Subsequent. Deliver to the Agent, in form and
substance satisfactory to the Agent and in sufficient copies for
each Lender Party, as soon as possible and in any event within 60
days after the Initial Extension of Credit (or such later date as
may be agreed by Crompton Corp. and the Agent or such later date
otherwise provided below):
(i)acknowledgment copies of proper financing statements, duly
filed under the Uniform Commercial Code of all jurisdictions that
the Collateral Agent may deem necessary or desirable in order to
perfect and protect the first priority liens and security
interests created under the Security Agreement, covering the
Collateral described in the Security Agreement,
(ii)completed requests for information, listing the financing
statements referred to in clause (i) above and all other
effective financing statements filed in the jurisdictions
referred to in clause (i) above that name any Loan Party as
debtor, together with copies of such financing statements,
(iii)(A) evidence that such action as the Agent may deem
necessary or desirable in order to perfect and protect the Liens
created under the Crompton Security Agreement on the capital
stock held by any Crompton Borrower or Crompton Guarantor in any
of its Foreign Subsidiaries that are Material Subsidiaries has
been taken, and (B) at the sole discretion of the Agent, evidence
that such actions as the Agent may deem necessary or desirable in
order to perfect and protect the Liens created under the Crompton
Security Agreement on the capital stock held by any Crompton
Borrower or Crompton Guarantor in any of its Foreign Subsidiaries
that are not Material Subsidiaries; provided that in any event
such Liens shall cover not more than 66% of the outstanding
capital stock of Foreign Subsidiaries directly owned by such Loan
Party and shall not cover any capital stock of any Foreign
Subsidiary directly or indirectly owned by a Foreign Subsidiary,
(iv)evidence that all other action as the Agent may deem
necessary or desirable in order to perfect and protect the first
priority liens and security interests created under the
Collateral Documents has been taken, and
(v)within 90 days after the date hereof, (A) cause (1) Crompton &
Xxxxxxx I.P.R. Corporation (if it has not already done so) to
duly execute and deliver to the Agent a guaranty, in form and
substance satisfactory to the Agent, guaranteeing the other Loan
Parties' Obligations under the Loan Documents, (2) Crompton &
Xxxxxxx I.P.R. Corporation (if it has not already done so) to
duly execute and deliver to the Agent, a pledge agreement,
pledging the intercompany Debt owed to Crompton & Xxxxxxx I.P.R.
Corporation, in form and substance satisfactory to the Agent,
securing payment of its Obligations under the Loan Documents and
constituting Liens on all such properties and (3) each direct and
indirect parent of Crompton & Xxxxxxx I.P.R. Corporation to duly
execute and deliver to the Agent, a pledge agreement, pledging
the capital stock of Crompton & Xxxxxxx I.P.R. Corporation, in
form and substance satisfactory to the Agent, securing payment of
its Obligations under the Loan Documents and constituting Liens
on all such properties or (B) fully dissolve and liquidate the
assets of Crompton & Xxxxxxx I.P.R. Corporation (if it has not
already done so).
SECTION 5.02. Negative Covenants. So long as any Advance shall
remain unpaid, any Letter of Credit shall be outstanding or any
Lender Party shall have any Commitment hereunder, no Borrower
will, at any time:
(a)Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer
to exist, any Lien on or with respect to any of its properties of
any character (including, without limitation, accounts) whether
now owned or hereafter acquired, or sign or file or suffer to
exist, or permit any of its Subsidiaries to sign or file or
suffer to exist, under the Uniform Commercial Code of any
jurisdiction, a financing statement that names any Borrower or
any of its Subsidiaries as debtor, or sign or suffer to exist, or
permit any of its Subsidiaries to sign or suffer to exist, any
security agreement authorizing any secured party thereunder to
file such financing statement, or assign, or permit any of its
Subsidiaries to assign, any accounts or other right to receive
income, excluding, however, from the operation of the foregoing
restrictions the following:
(i)Liens created under the Loan Documents;
(ii)with respect to any Person, all of the following
(collectively, the "Permitted Liens"):
(A)pledges or deposits by such Person under workers' compensation
laws, unemployment insurance laws or similar legislation or good
faith deposits in connection with bids, tenders, contracts (other
than for the payment of Debt) or leases to which such Person is a
party, or deposits to secure public or statutory obligations of
such Person or deposits of cash or United States Government bonds
to secure surety or appeal bonds to which such Person is a party,
or deposits as security for contested taxes or for charges
relating thereto (including, without limitation, interest,
penalties and certain other similar charges) or import duties or
for the payment of rent;
(B)(x) liens imposed by law, such as carriers', warehousemen's
and mechanics' liens or (y) other liens arising out of judgments
or awards against such Person with respect to which such Person
shall then be prosecuting an appeal or other proceedings for
review or otherwise arising out of judicial proceedings to the
extent such liens do not constitute an Event of Default;
(C)liens for taxes, assessments or governmental charges or
levies to the extent not required to be paid by Section 5.01(b);
and
(D)minor survey exceptions, minor encumbrances, easements or
reservations of, or rights of others for, rights of way, sewers,
electric lines, telegraph and telephone lines and other similar
purposes, or zoning or other restrictions as to the use of real
properties or liens incidental to the conduct of the business of
such Person or to the ownership of its properties which were not
incurred in connection with Debt or other extensions of credit
and which do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the
operation of the business of such Person.
(iii)Liens existing on the date hereof and described on
Schedule 5.02(a) hereto;
(iv)purchase money Liens upon or in real property or personal
property (other than Inventory of Uniroyal Corp. and its
Subsidiaries) acquired or held by any Borrower or any of its
Subsidiaries in the ordinary course of business to secure the
purchase price of such property or to secure Debt incurred solely
for the purpose of financing the acquisition, construction or
improvement of any such property to be subject to such Liens, or
Liens existing on any such property at the time of acquisition
(other than any such Liens created in contemplation of such
acquisition that do not secure the purchase price); provided,
however, that no such Lien shall extend to or cover any property
other than the property being acquired, constructed or improved,
and no such extension, renewal or replacement shall extend to or
cover any property not theretofore subject to the Lien being
extended, renewed or replaced; and provided further that the
aggregate principal amount of the Debt secured by Liens permitted
by this clause (iv) shall not exceed the amount permitted under
Section 5.02(b)(iii)(B) at any time outstanding and that any such
Debt shall not otherwise be prohibited by the terms of the Loan
Documents;
(v)Liens arising in connection with Capitalized Leases permitted
under Section 5.02(b)(iii)(C); provided that no such Lien shall
extend to or cover any Collateral or assets other than the assets
subject to such Capitalized Leases;
(vi)Liens on property of a Person existing at the time such
Person is merged into or consolidated with any Borrower or any
Subsidiary of such Borrower or becomes a Subsidiary of such
Borrower; provided that such Liens were not created in
contemplation of such merger, consolidation or investment and do
not extend to any assets other than those of the Person merged
into or consolidated with such Borrower or such Subsidiary or
acquired by such Borrower or such Subsidiary;
(vii)Liens arising in connection with any lease permitted under
Section 5.02(c), provided that no such Lien shall extend to or
cover any assets other than the assets subject to such lease;
(viii)Liens securing Debt incurred by Foreign Subsidiaries
pursuant to Section 5.02(b)(iii)(G) and (H);
(ix)Liens on accounts receivable (and in property securing or
otherwise supporting such accounts receivable together with
proceeds thereof) of Crompton Corp. and its Subsidiaries (other
than Uniroyal Corp. and its Subsidiaries) in connection with a
Receivables Securitization;
(x)Liens securing Obligations of Crompton Corp. or any of its
Subsidiaries in an aggregate amount not to exceed $5,000,000 at
any time outstanding;
(xi)filings for information purposes only under the Uniform
Commercial Code, as amended, of any state in connection with a
lease of property (other than Capitalized Leases); and
(xii)Liens to secure any extension, renewal or replacement (or
successive extensions, renewals or replacements) as a whole, or
in part, of any Debt secured by any Lien referred to in the
foregoing clauses (iii) through (vii), provided that (i) such
extended, renewed or replacement Lien shall be limited to all or
part of the same type of property that secured the Lien extended,
renewed or replaced (plus improvements on such property) and (ii)
the Debt secured by such Lien at such time is not increased to an
amount in excess of the original principal amount of the Debt
secured by such Lien.
(b)Debt. Create, incur, assume or suffer to exist, or permit any
of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
(i)in the case of the Borrowers,
(A)Debt of the Uniroyal Borrower in respect of the Seoul
Guaranty, provided that the U.S. dollar equivalent of the amount
of such Debt shall not exceed U.S.$5,000,000,
(B)Debt in respect of Interest Rate Swap Agreements designed to
hedge against fluctuations in interest rates incurred in the
ordinary course of business and consistent with prudent business
practice in an aggregate notional amount not to exceed
$400,000,000 at any time outstanding,
(C)Debt in respect of Foreign Exchange Agreements designed to
hedge against fluctuations in foreign exchange rates incurred in
the ordinary course of business and consistent with prudent
business practice in an aggregate notional amount not to exceed
$100,000,000 at any time outstanding, and
(D)Debt owed to Crompton Corp. or to a wholly owned Subsidiary of
Crompton Corp, provided that, solely with respect to any
Borrower, Guarantor and Uniroyal Chemical Ltd., such Debt (x)
shall, to the extent not prohibited by the terms of the Uniroyal
Indentures then in effect, constitute Pledged Debt (as defined in
the Security Agreement) other than any such Debt owing to any
Minor Subsidiary and (y) shall, to the extent not prohibited by
the terms of the Uniroyal Indentures then in effect, be evidenced
by promissory notes in form and substance satisfactory to the
Agent and such promissory notes shall be pledged as security for
the Obligations under the Loan Documents of the holder thereof
and delivered to the Agent pursuant to the terms of the Security
Agreement,
(ii)in the case of any of such Borrower's Subsidiaries (other
than any Minor Subsidiary), Debt owed to any Borrower or to a
wholly owned Subsidiary of any Borrower, provided that, solely
with respect to any Borrower, Guarantor and Uniroyal Chemical
Ltd., such Debt (A) shall, to the extent not prohibited by the
terms of the Uniroyal Indentures then in effect, constitute
Pledged Debt (as defined in the Security Agreement) other than
any such Debt owing to any Minor Subsidiary and (B) shall be
evidenced by promissory notes in form and substance satisfactory
to the Agent and such promissory notes shall be pledged as
security for the Obligations under the Loan Documents of the
holder thereof and delivered to the Agent pursuant to the terms
of the Security Agreement, and
(iii)in the case of the Borrowers and their respective
Subsidiaries (other than any Minor Subsidiary except as provided
below),
(A)Debt under the Loan Documents,
(B)Debt secured by Liens permitted by Section 5.02(a)(iv) not to
exceed in the aggregate, together with Debt referred to in clause
(C) below, $100,000,000 at any time outstanding,
(C)(i) Capitalized Leases not to exceed in the aggregate,
together with Debt referred to in clause (B) above, $100,000,000
at any time outstanding and (ii) in the case of Capitalized
Leases to which any Subsidiary of any Borrower is a party, Debt
of such Borrower of the type described in clause (i) of the
definition of "Debt" guaranteeing the Obligations of such
Subsidiary under such Capitalized Leases,
(D)the Surviving Debt listed on Part I of Schedule 3.01(d)
hereto, and any Debt extending the maturity of, or refunding or
refinancing, in whole or in part, any Surviving Debt, provided
that the terms of any such extending, refunding or refinancing
Debt, and of any agreement entered into and of any instrument
issued in connection therewith, are otherwise permitted by the
Loan Documents; provided further that the terms relating to
principal amount, amortization, maturity, collateral (if any) and
subordination (if any), and other material terms taken as a
whole, of any such extending, refunding or refinancing Debt, and
of any agreement entered into and of any instrument issued in
connection therewith, are no less favorable in any material
respect to the Loan Parties or the Lender Parties than the terms
of any agreement or instrument governing the Surviving Debt being
extended, refunded or refinanced and the interest rate applicable
to any such extending, refunding or refinancing Debt does not
exceed the then market interest rate for companies having a
credit standing similar to that of Crompton Corp. at such time,
provided still further that the principal amount of such
Surviving Debt shall not be increased above the principal amount
thereof outstanding immediately prior to such extension,
refunding or refinancing plus the amount of any redemption
premium stipulated in the indenture relating to such Surviving
Debt or other reasonable premium paid in connection with any
redemption of, or tender offer or exchange offer for, or open
market purchase of, such Surviving Debt, and the direct and
contingent obligors therefor shall not be changed, as a result of
or in connection with such extension, refunding or refinancing,
provided still further that any Debt refinancing the Surviving
Debt with respect to the Receivables Securitization listed on
Part I of Schedule 3.01(d) may be incurred up to 6 months after
the termination of such Receivables Securitization,
(E)Debt of any Person that becomes a Subsidiary of any Borrower
after the date hereof in accordance with the terms of Section
5.02(f) which Debt is existing at the time such Person becomes a
Subsidiary of such Borrower (other than Debt incurred solely in
contemplation of such Person becoming a Subsidiary of such
Borrower),
(F)Debt owing to the Daylight Overdraft Bank in respect of any
daylight overdraft facility or in connection with any automated
clearing house transfers of funds in an aggregate amount
outstanding at any time not to exceed $10,000,000 in the case of
the Crompton Borrowers and $10,000,000 in the case of the
Uniroyal Borrower,
(G)(i)Debt of any Foreign Subsidiary or any of its Subsidiaries
incurred for business purposes, provided that the aggregate Debt
described in this clause (G) for all such Persons at any one time
outstanding shall not exceed the sum of (A) 60% of the book value
of Inventory of Foreign Subsidiaries plus (B) 90% of the book
value of Receivables of Foreign Subsidiaries plus (C)
$100,000,000 and (ii) Debt of any Borrower of the type described
in clause (i) of the definition of "Debt" guaranteeing up to 40%
of the Obligations of Foreign Subsidiaries outstanding under
clause (i) above,
(H)Debt of Foreign Subsidiaries relating to sales of accounts
receivable pursuant to Section 5.02(e)(v),
(I)Debt, if any, of Crompton Corp. and its Subsidiaries (other
than Uniroyal Corp. and its Subsidiaries and the Minor
Subsidiaries), incurred in connection with a Receivables
Securitization,
(J)short term, unsecured Debt in an aggregate amount not to
exceed $75,000,000 at any time outstanding, provided, however,
that the aggregate amount of Debt issued or incurred pursuant to
this clause (J) and clause (K) shall not exceed in the aggregate
$125,000,000 at any time outstanding,
(K)other Debt in an aggregate amount not to exceed $75,000,000 at
any time outstanding, provided, however, that the aggregate
amount of Debt issued or incurred pursuant to clause (J) and this
clause (K) shall not exceed in the aggregate $125,000,000 at any
time outstanding,
(L)endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of
business,
(M)unsecured Debt of Naugatuck in an aggregate amount not to
exceed $1,000,000 at any time outstanding, and
(N)intercompany Debt owing to Crompton & Xxxxxxx I.P.R.
Corporation in an amount not to exceed $33,000,000 at any time
outstanding subject, however, to the provisions of Section
5.01(l)(v).
(c)Lease Obligations. Create, incur, assume or suffer to exist,
or permit any of its Subsidiaries to create, incur, assume or
suffer to exist, any obligations as lessee for the rental or hire
of real or personal property of any kind under leases or
agreements to lease (including Capitalized Leases) having an
original term of one year or more that would cause the direct and
contingent liabilities of Crompton Corp. and its Subsidiaries, on
a Consolidated basis, in respect of all such obligations to
exceed $50,000,000 payable in any period of 12 consecutive
months; provided, however, that no Minor Subsidiary (other than
Naugatuck) shall create, incur, assume or suffer to exist any
obligations as lessee for the rental or hire of real or personal
property of any kind under leases or agreements to lease
(including Capitalized Leases).
(d)Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its
Subsidiaries to do so, except that (i) the Borrowers and their
Subsidiaries may consummate the Merger, (ii) Uniroyal Corp. may
merge into or consolidate with Crompton Corp., (iii) any Foreign
Subsidiary may merge into or consolidate with any other Foreign
Subsidiary; (iv) any Foreign Subsidiary may merge into or
consolidate with any Domestic Subsidiary, provided that such
Domestic Subsidiary shall survive such merger, (v) any Domestic
Subsidiary of Crompton Corp. (other than the Borrowers and
Uniroyal Corp. and its Subsidiaries) may merge into or
consolidate with any other Domestic Subsidiary of Crompton Corp.
(other than the Borrowers and Uniroyal Corp. and its
Subsidiaries) so long as if any Loan Party is party to such
merger or consolidaton, such Loan Party shall survive such merger
or consolidation, (vi) any Domestic Subsidiary of Uniroyal Corp.
may merge into or consolidate with any other Domestic Subsidiary
of Uniroyal Corp. so long as if any Loan Party is party to such
merger or consolidation, such Loan Party shall survive such
merger or consolidation, (vii) after the Collateral Release Date,
any Subsidiary of Crompton Corp. (other than the other Borrowers)
may merge into or consolidate with any Borrower or any other
Subsidiary of Crompton Corp. so long as if any Borrower is party
to such merger or consolidation, such Borrower shall survive such
merger or consolidation, (viii) in connection with any
acquisition permitted under Section 5.02(f), any Subsidiary of
Crompton Corp. may merge into or consolidate with any other
Person or permit any other Person to merge into or consolidate
with it; provided that the Person surviving such merger shall be
a wholly owned Subsidiary of Crompton Corp. and (ix) in
connection with any sale or other disposition permitted under
Section 5.02(e) (other than clause (ii) thereof), any Subsidiary
of Crompton Corp. may merge into or consolidate with any other
Person or permit any other Person to merge into or consolidate
with it; provided, however, that in each case, immediately after
giving effect thereto, no event shall occur and be continuing
that constitutes a Default and, in the case of any such merger to
which Crompton Corp. is a party, Crompton Corp. is the surviving
corporation.
(e)Sales, Etc. of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease,
transfer or otherwise dispose of, any assets, or grant any option
or other right to purchase, lease or otherwise acquire any assets
other than Inventory to be sold in the ordinary course of its
business, except:
(i)sales of Inventory in the ordinary course of its business,
(ii)in a transaction authorized by Section 5.02(d) (other than
clause (ix) thereof),
(iii)sales of assets and for fair value in an aggregate amount
not to exceed $50,000,000 in any Fiscal Year,
(iv)the sale or other disposition of damaged, worn out or
obsolete property that is no longer necessary for the proper
conduct of the business of Crompton Corp. and its Subsidiaries in
the ordinary course of business,
(v)sales of accounts receivable of Foreign Subsidiaries on a
basis which is non-recourse to Crompton Corp. and its
Subsidiaries (other than any Minor Subsidiary) (which accounts
receivable shall at no time exceed 25% of the aggregate accounts
receivable of Crompton Corp. and its Consolidated Subsidiaries),
(vi)sales of assets after the Effective Date having an aggregate
fair market value of not more than the greater of (A)
$100,000,000 and (B) an amount equal to 5% of Consolidated sales
of Crompton Corp. and its Subsidiaries since the Effective Date,
provided that the Net Cash Proceeds of such asset sales are
applied to purchase substantially similar assets (whether by
means of an acquisition of stock or assets or otherwise)
constituting Investments permitted under Section 5.02(f) or
Capital Expenditures permitted under Section 5.02(n) or to prepay
permanently Debt of Crompton Corp. or any of its Subsidiaries,
(vii)sales of accounts receivable of Crompton Corp. and its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries and
the Minor Subsidiaries) in connection with agreements for limited
recourse or non-recourse sales by Crompton Corp. or any of its
Subsidiaries (other than Uniroyal Corp. and its Subsidiaries and
the Minor Subsidiaries) for cash, provided that (A) any such
agreement is of a type and on terms customary for comparable
transactions in the good faith judgment of the Board of Directors
of Crompton Corp., (B) such agreement does not create any
interest in any asset other than accounts receivable (and
property securing or otherwise supporting accounts receivable)
and proceeds of the foregoing and (C) the Net Cash Proceeds
thereof in excess of $25,000,000 shall be applied to the
permanent reduction of the Facilities in accordance with Section
2.05(b)(iv) (a "Receivables Securitization"),
(viii)the sale of assets listed in a letter dated the Effective
Date from Crompton Corp. addressed and delivered to the Lender
Parties on or prior to the Effective Date, and
(ix)the transfer of assets among Loan Parties to the extent
permitted under Section 5.02(f)(vii).
(f)Investments in Other Persons. Make or hold, or permit any of
its Subsidiaries to make or hold, any Investment in any Person
other than:
(i)equity Investments by the Borrowers and their Subsidiaries in
their Subsidiaries outstanding on the date hereof and additional
equity investments in wholly owned Subsidiaries (other than any
Minor Subsidiary), which Subsidiaries were in existence on the
date hereof;
(ii)loans and advances to employees in the ordinary course of the
business of the Borrowers and their Subsidiaries (other than any
Minor Subsidiary) as presently conducted in an aggregate
principal amount not to exceed $5,000,000 at any time
outstanding;
(iii)Investments by the Borrowers and their Subsidiaries in Cash
Equivalents;
(iv)Investments by the Borrowers in Hedge Agreements permitted
under Sections 5.02(b)(i)(B) and (C);
(v)Investments consisting of intercompany Debt permitted under
Section 5.02(b)(i)(D) or (ii);
(vi)Investments existing on the date hereof and described on Part
I of Schedule 5.02(f) hereto;
(vii)Investments consisting of the contribution of assets of (A)
any Loan Party to any other Loan Party in an aggregate amount not
to exceed $50,000,000 in any Fiscal Year or $100,000,000 in the
aggregate after the Effective Date, (B) any Domestic Subsidiary
to any Foreign Subsidiary in an aggregate amount not to exceed
$25,000,000 in any Fiscal Year or $50,000,000 in the aggregate
after the Effective Date, (C) any Foreign Subsidiary to any other
Foreign Subsidiary, (D) any Foreign Subsidiary to any Domestic
Subsidiary (other than any Minor Subsidiary) and (E) Uniroyal to
Uniroyal Chemical Leasing Company, Inc. in an amount not to
exceed $100,000,000 in the aggregate after the Effective Date;
(viii) Investments by Crompton Corp. and its Subsidiaries in (A)
the joint ventures listed on Part II of Schedule 5.02(f) and
other joint ventures and non-wholly owned Subsidiaries in an
aggregate amount invested (including, without limitation,
assumption of debt, noncompetition arrangements, "earn-outs" and
other deferred payment arrangements) not to exceed $50,000,000
and (B) Monochem, Inc. and Rubicon, Inc.; provided that with
respect to Investments made under this clause (viii): (1)
immediately before and after giving effect thereto, no Default
shall have occurred and be continuing or would result therefrom;
(2) any business acquired or invested in pursuant to this clause
(viii) shall be in the same general line of business or
substantially related lines of business as the business of
Crompton Corp. or such Subsidiary; and (3) immediately after
giving effect to the acquisition of a company or business
pursuant to this clause (viii), Crompton Corp. shall be in pro
forma compliance with the covenants contained in Section 5.04,
calculated based on the relevant Financial Statements, as though
such acquisition had occurred at the beginning of the 12-month
period covered thereby, as evidenced by a certificate of the
chief financial officer or treasurer of Crompton Corp. furnished
to the Lender Parties, demonstrating such compliance;
(ix)other Investments (other than Investments in Minor
Subsidiaries) in an aggregate amount invested not to exceed the
sum of (A) an amount equal to the aggregate Net Cash Proceeds of
any equity issued by Crompton Corp. after the Effective Date and
(B) in any Fiscal Year, an amount equal to Available Cash Flow
for such Fiscal Year; provided that with respect to Investments
made under this clause (ix): (1) any newly acquired or created
Subsidiary of any Borrower or any of its Subsidiaries shall be a
wholly owned Subsidiary thereof; (2) immediately before and after
giving effect thereto, no Default shall have occurred and be
continuing or would result therefrom; (3) any business acquired
or invested in pursuant to this clause (ix) shall be in the same
general line of business or substantially related lines of
business as the business of such Borrower or any of its
Subsidiaries; and (4) immediately after giving effect to the
acquisition of a company or business pursuant to this clause
(ix), Crompton Corp. shall be in pro forma compliance with the
covenants contained in Section 5.04, calculated based on the
relevant Financial Statements, as though such acquisition had
occurred at the beginning of the 12-month period covered thereby,
as evidenced by a certificate of the chief financial officer or
treasurer of Crompton Corp. furnished to the Lender Parties,
demonstrating such compliance; and
(x)additional equity Investments in Naugatuck and intercompany
Debt incurred by Naugatuck not to exceed $5,000,000 in the
aggregate from the date hereof.
(g)Dividends, Etc. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its
capital stock or any warrants, rights or options to acquire such
capital stock, now or hereafter outstanding, return any capital
to its stockholders as such, make any distribution of assets,
capital stock, warrants, rights, options, obligations or
securities to its stockholders as such or issue or sell any
capital stock or any warrants, rights or options to acquire such
capital stock, or permit any of its Subsidiaries to do any of the
foregoing or permit any of its Subsidiaries to purchase, redeem,
retire, defease or otherwise acquire for value any capital stock
of any Borrower or any warrants, rights or options to acquire
such capital stock or to issue or sell any capital stock or any
warrants, rights or options to acquire such capital stock, except
that, so long as no Default shall have occurred and be continuing
at the time of any action described in clauses (i) and (ii) below
or would result therefrom, (i) Crompton Corp. may (A) declare and
pay dividends and distributions payable only in common stock of
Crompton Corp., (B) issue and sell shares of its capital stock,
(C) purchase, redeem, retire, defease or otherwise acquire shares
of its capital stock with the proceeds received from the issue of
new shares of its capital stock with equal or inferior voting
powers, designations, preferences and rights and (D) declare and
pay cash dividends to its stockholders and purchase, redeem,
retire or otherwise acquire shares of its own outstanding capital
stock for cash in an amount not to exceed in the Fiscal Year
ending on or about December 31, 1996, $15,000,000, and in any
Fiscal Year thereafter the greater of (I) $15,000,000 and (II)
50% of Consolidated net income of Crompton Corp. and its
Subsidiaries for the immediately preceding Fiscal Year computed
in accordance with GAAP, and (ii) any Subsidiary of Crompton
Corp. may (A) declare and pay cash dividends to any Borrower
(including, without limitation, the declaration and payment of
cash dividends by Uniroyal to Uniroyal Corp.) and (B) declare and
pay cash dividends to any other wholly owned Subsidiary of any
Borrower of which it is a Subsidiary.
(h)Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its
business as carried on at the date hereof.
(i)Charter Amendments. Amend, or permit any of its Subsidiaries
to amend, its certificate of incorporation or bylaws in any
material respect.
(j)Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) accounting
policies or reporting practices, except as required or permitted
by generally accepted accounting principles or (ii) Fiscal Year,
except in each case, as necessary to make such Fiscal Year the
same with respect to Uniroyal Corp. and Crompton Corp.
(k)Amendment, Etc. of Related Documents. Cancel or terminate any
Related Document or consent to or accept any cancellation or
termination thereof, amend, modify or change in any manner any
term or condition of any Related Document or give any consent,
waiver or approval thereunder, waive any default under or any
breach of any term or condition of any Related Document, agree in
any manner to any other amendment, modification or change of any
term or condition of any Related Document or take any other
action in connection with any Related Document, in each case that
would impair in any material respect the value of the interest or
rights of any Borrower thereunder or that would impair the rights
or interests of the Agent or any Lender Party, or permit any of
its Subsidiaries to do any of the foregoing.
(l)Negative Pledge. Enter into or suffer to exist, or permit any
of its Subsidiaries to enter into or suffer to exist, any
agreement prohibiting or conditioning the creation or assumption
of any Lien upon any of its property or assets other than (i) in
favor of the Secured Parties, (ii) in connection with any
Surviving Debt, any Debt extending the maturity of, or refunding
or refinancing, in whole or in part, any Surviving Debt in
accordance with Section 5.02(b)(iii)(D) (to the extent the
agreement or instrument evidencing such Surviving Debt contained
such a provision or agreement) and any Debt outstanding on the
date such Subsidiary first becomes a Subsidiary (so long as such
agreement was not entered into solely in contemplation of such
Subsidiary becoming a Subsidiary) or (iii) in connection with any
lease permitted under Section 5.02(c) solely to the extent that
such lease prohibits a Lien on the lease or the property subject
to such lease.
(m)Partnerships, Etc. Become a general partner in any general or
limited partnership or joint venture, or permit any of its
Subsidiaries to do so, other than any Subsidiary the sole assets
of which consist of its interest in such partnership or joint
venture.
(n)Capital Expenditures. Make, or permit any of its Subsidiaries
to make, any Capital Expenditures that would cause the aggregate
of all such Capital Expenditures made by Crompton Corp. and its
Subsidiaries in any period set forth below to exceed the amount
set forth below for such period.
Fiscal Year Ending On or About Amount
December 31, 1996 $100,000,000
December 31, 1997 $100,000,000
December 31, 1998 $110,000,000
December 31, 1999 $110,000,000
December 31, 2000 $110,000,000
December 31, 2001
and thereafter $110,000,000
plus, for each Fiscal Year set forth above, an amount equal to
(i) the excess, if any, of the amount set opposite the
immediately preceding Fiscal Year over the aggregate amount of
such Capital Expenditures actually made during such Fiscal Year
(other than pursuant to clause (ii) below), provided that any
Capital Expenditures made in any Fiscal Year shall be applied
first against any amount permitted to be carried over from the
immediately preceding Fiscal Year and (ii) the amount of any Net
Cash Proceeds received with respect to the sale, lease, transfer
or other disposition of assets pursuant to Section 5.02(e)(vi),
solely to the extent such Net Cash Proceeds are not used to make
Investments permitted under Section 5.02(f) or to prepay
permanently Debt of Crompton Corp. or any of its Subsidiaries,
provided that such amount of Net Cash Proceeds shall not be
carried over to any subsequent Fiscal Year pursuant to clause (i)
above.
(o) Minor Subsidiaries. Permit any Minor Subsidiary (other than
Naugatuck Treatment Company) to enter into or conduct any
business or engage in any activity (including, without
limitation, any action or transaction that is required or
restricted with respect to any Borrower and its Subsidiaries
under Section 5.01 and this Section 5.02).
SECTION 5.03. Reporting Requirements. So long as any
Advance shall remain unpaid, any Letter of Credit shall be
outstanding or any Lender Party shall have any Commitment
hereunder, Crompton Corp. will furnish to the Agent and the
Lender Parties:
(a) Default Notice. As soon as possible and in any event
within five days after any Responsible Officer of any Borrower
becomes aware of the occurrence of each Default or any event,
development or occurrence reasonably likely to have a Material
Adverse Effect continuing on the date of such statement, a
statement of the chief financial officer, treasurer or chief
accounting officer of such Borrower setting forth details of such
Default and the action that such Borrower has taken and proposes
to take with respect thereto.
(b) Quarterly Financials. As soon as available and in any
event within 50 days after the end of each of the first three
quarters of each Fiscal Year, Consolidated and, to the extent
otherwise available, consolidating balance sheets of Crompton
Corp. and its Subsidiaries and Consolidated balance sheets of
Uniroyal Corp. and its Subsidiaries, in each case, as of the end
of such quarter and Consolidated and, to the extent otherwise
available, consolidating statements of income and a Consolidated
statement of cash flows of Crompton Corp. and its Subsidiaries
and Consolidated statements of income and of cash flows of
Uniroyal Corp. and its Subsidiaries, in each case, for the period
commencing at the end of the previous fiscal quarter and ending
with the end of such fiscal quarter and Consolidated and, to the
extent otherwise available, consolidating statements of income
and a Consolidated statement of cash flows of Crompton Corp. and
its Subsidiaries and Consolidated statements of income and of
cash flows of Uniroyal Corp. and its Subsidiaries, in each case,
for the period commencing at the end of the previous Fiscal Year
and ending with the end of such quarter, setting forth in each
case in comparative form the corresponding figures for the
corresponding period of the preceding Fiscal Year, all in
reasonable detail and duly certified (subject to year-end audit
adjustments) by the chief financial officer or treasurer of such
Borrower as having been prepared in accordance with GAAP,
together with (i) a certificate of said officer stating that no
Default has occurred and is continuing or, if a Default has
occurred and is continuing, a statement as to the nature thereof
and the action that such Borrower has taken and proposes to take
with respect thereto and (ii) a schedule in form satisfactory to
the Agent of the computations used by Crompton Corp. in
determining compliance with the covenants contained in Sections
5.04(a) and (b), provided that in the event of any change in GAAP
used in the preparation of such financial statements, Crompton
Corp. shall also provide, if necessary for the determination of
compliance with Section 5.04, a statement of reconciliation
conforming such financial statements to GAAP.
(c) Annual Financials. As soon as available and in any event
within 95 days after the end of each Fiscal Year, a copy of the
annual report for such year for Crompton Corp. and its
Subsidiaries, including therein a Consolidated balance sheet of
Crompton Corp. and its Subsidiaries as of the end of such Fiscal
Year and a Consolidated statement of income and a Consolidated
statement of cash flows of Crompton Corp. and its Subsidiaries
for such Fiscal Year, in each case accompanied by an opinion
acceptable to the Required Lenders of KPMG Peat Marwick LLP or
other independent public accountants of recognized standing
acceptable to the Required Lenders, and a Consolidated and, to
the extent otherwise available, consolidating balance sheets of
Crompton Corp. and Uniroyal Corp. and their respective
Subsidiaries as of the end of such Fiscal Year and Consolidated
and, to the extent otherwise available, consolidating statements
of income and a Consolidated statement of cash flows of Crompton
Corp. and Uniroyal Corp. and their respective Subsidiaries for
such Fiscal Year, all in reasonable detail and duly certified by
the chief financial officer or treasurer of such Borrower as
having been prepared in accordance with GAAP, together with (i) a
certificate of such accounting firm to the Lender Parties stating
that in the course of the regular audit of the business of
Crompton Corp. and its Subsidiaries, which audit was conducted by
such accounting firm in accordance with generally accepted
auditing standards, such accounting firm has obtained no
knowledge that a Default has occurred and is continuing, or if,
in the opinion of such accounting firm, a Default has occurred
and is continuing, a statement as to the nature thereof, (ii) a
schedule in form satisfactory to the Agent of the computations
used by such accountants in determining, as of the end of such
Fiscal Year, compliance with the covenants contained in
Sections 5.04(a) and (b), provided that in the event of any
change in GAAP used in the preparation of such financial
statements, Crompton Corp. shall also provide, if necessary for
the determination of compliance with Section 5.04, a statement of
reconciliation conforming such financial statements to GAAP and
(iii) a certificate of the chief financial officer or treasurer
of each Borrower stating that no Default has occurred and is
continuing or, if a default has occurred and is continuing, a
statement as to the nature thereof and the action that such
Borrower has taken and proposes to take with respect thereto.
(d) Annual Forecasts. As soon as available and in any event no
later than 30 days after the end of each Fiscal Year, forecasts
prepared by management of Crompton Corp. and Uniroyal Corp., in
form satisfactory to the Agent, of balance sheets, income
statements and cash flow statements for Crompton Corp. and its
Subsidiaries, Uniroyal Corp. and its Subsidiaries and Crompton
Corp. and its Subsidiaries (other than Uniroyal Corp. and its
Subsidiaries) on an annual basis for the Fiscal Year following
such Fiscal Year then ended and for each Fiscal Year thereafter
until the Termination Date.
(e) Annual Budget. As soon as available and in any event
within 30 days after the end of each Fiscal Year, an annual
budget for Crompton Corp. and its Subsidiaries, Uniroyal Corp.
and its Subsidiaries and Crompton Corp. and its Subsidiaries
(other than Uniroyal Corp. and its Subsidiaries), prepared by
management of Crompton Corp. and Uniroyal Corp. consisting of
balance sheets, income statements and cash flow statements on a
quarterly basis for the Fiscal Year following such Fiscal Year
then ended in form and substance satisfactory to the Agent.
(f) ERISA Events and ERISA Reports. (i) Promptly and in any
event within 15 days after any Loan Party or any ERISA Affiliate
knows or has reason to know that any ERISA Event has occurred, a
statement of the chief financial officer or treasurer of Crompton
Corp. describing such ERISA Event and the action, if any, that
such Loan Party or such ERISA Affiliate has taken and proposes to
take with respect thereto and (ii) promptly and in any event
within two days after the date any records, documents or other
information must be furnished to the PBGC with respect to any
Plan pursuant to Section 4010 of ERISA, a copy of such records,
documents and information.
(g) Plan Terminations. Promptly and in any event within three
Business Days after receipt thereof by any Loan Party or any
ERISA Affiliate, copies of each notice from the PBGC stating its
intention to terminate any Plan or to have a trustee appointed to
administer any Plan.
(h) Plan Annual Reports. Promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service,
copies of each Schedule B (Actuarial Information) to the annual
report (Form 5500 Series) with respect to each Plan.
(i) Multiemployer Plan Notices. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party
or any ERISA Affiliate from the sponsor of a Multiemployer Plan,
copies of each notice concerning (i) the imposition of Withdrawal
Liability by any such Multiemployer Plan, (ii) the reorganization
or termination, within the meaning of Title IV of ERISA, of any
such Multiemployer Plan or (iii) the amount of liability
incurred, or that may be incurred, by such Loan Party or any
ERISA Affiliate in connection with any event described in
clause (i) or (ii).
(j) Litigation. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and
proceedings before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or
foreign, affecting any Loan Party or any of its Subsidiaries of
the type described in Section 4.01(k), and promptly after the
occurrence thereof, notice of any adverse change in the status or
the financial effect on any Loan Party or any of its Subsidiaries
of the Disclosed Litigation from that described on
Schedule 3.01(f).
(k) Securities Reports. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and
reports that any Loan Party or any of its Subsidiaries sends to
its outside stockholders, and copies of all regular, periodic and
special reports, and all registration statements, that any Loan
Party or any of its Subsidiaries files with the Securities and
Exchange Commission or any governmental authority that may be
substituted therefor, or with any national securities exchange.
(l) Creditor Reports. Promptly after the furnishing
thereof, copies of any statement or report furnished to any other
holder of the securities of any Loan Party or of any of its
Subsidiaries pursuant to the terms of any indenture, loan or
credit or similar agreement and not otherwise required to be
furnished to the Lender Parties pursuant to any other clause of
this Section 5.03.
(m) Agreement Notices. Promptly upon receipt thereof, copies
of all notices of any default or breach and all other material
requests and other documents received by any Loan Party or any of
its Subsidiaries under or pursuant to any Related Document or
indenture, loan or credit or similar agreement and, from time to
time upon request by the Agent, such information and reports
regarding the Related Documents as the Agent may reasonably
request.
(n) Revenue Agent Reports. Within 10 days after receipt, copies
of all Revenue Agent Reports (Internal Revenue Service Form 886),
or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive adjustments to
the Federal income tax liability of the affiliated group (within
the meaning of Section 1504(a)(1) of the Internal Revenue Code)
of which Crompton Corp. is a member aggregating $3,000,000 or
more.
(o) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or
of any noncompliance by any Loan Party or any of its Subsidiaries
with any Environmental Law or Environmental Permit that could
reasonably be expected to have a Material Adverse Effect.
(p) Other Information. Such other information respecting the
business, condition (financial or otherwise), operations,
performance, properties or prospects of any Loan Party or any of
its Subsidiaries as any Lender Party (through the Agent) may from
time to time reasonably request.
SECTION 5.04. Financial Covenants. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or
any Lender Party shall have any Commitment hereunder, Crompton
Corp. will:
(a) Leverage Ratio. Maintain at the end of each fiscal quarter
of Crompton Corp. a Total Debt/EBITDA Ratio of not more than the
amount set forth below for each Rolling Period set forth below:
Rolling Period Ending On or About Ratio
September 30, 1996 4.00:1.0
December 31, 1996 4.00:1.0
March 31, 1997 4.00:1.0
June 30, 1997 4.00:1.0
September 30, 1997 3.75:1.0
December 31, 1997 3.75:1.0
March 31, 1998 3.75:1.0
June 30, 1998 3.50:1.0
September 30, 1998 3.50:1.0
December 31, 1998 3.50:1.0
March 31, 1999 3.25:1.0
June 30, 1999 3.00:1.0
September 30, 1999 3.00:1.0
December 31, 1999 3.00:1.0
March 31, 2000 3.00:1.0
June 30, 2000 3.00:1.0
September 30, 2000 3.00:1.0
December 31, 2000 3.00:1.0
March 31, 2001 3.00:1.0
June 30, 2001
thereafter 3.00:1.0
(b)Interest Coverage Ratio. Maintain at the end of each fiscal
quarter of Crompton Corp. an Interest Coverage Ratio of not less
than the amount set forth below for each Rolling Period set forth
below:
Rolling Period Ending On or About Ratio
September 30, 1996 2.50:1.0
December 31, 1996 2.50:1.0
March 31, 1997 2.50:1.0
June 30, 1997 2.50:1.0
September 30, 1997 2.75:1.0
December 31, 1997 2.75:1.0
March 31, 1998 2.75:1.0
June 30, 1998 2.75:1.0
September 30, 1998 2.75:1.0
December 31, 1998 3.00:1.0
March 31, 1999 3.00:1.0
June 30, 1999 3.00:1.0
September 30, 1999 3.25:1.0
December 31, 1999 3.25:1.0
March 31, 2000 3.50:1.0
June 30, 2000 3.50:1.0
September 30, 2000 3.50:1.0
December 31, 2000 3.50:1.0
March 31, 2001 3.50:1.0
June 30, 2001
and thereafter 3.50:1.0
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing:
(a) (i) any Borrower shall fail to pay any principal of any
Advance when the same shall become due and payable or (ii) any
Borrower shall fail to pay any interest on any Advance, or any
Loan Party shall fail to make any other payment under any Loan
Document, in each case under this clause (ii) within five days
after the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan
Document shall prove to have been incorrect in any material
respect when made; or
(c) any Borrower shall fail to perform or observe any term,
covenant or agreement contained in Section 2.14, 5.01(d), (e),
(k) or (l), 5.02, 5.03(a) or 5.04; or
(d) any Loan Party shall fail to perform or observe any other
term, covenant or agreement contained in any Loan Document on its
part to be performed or observed if such failure shall remain
unremedied for 15 days after the earlier of the date on which (A)
a Responsible Officer becomes aware of such failure or (B)
written notice thereof shall have been given to Crompton Corp. by
the Agent or any Lender Party; or
(e) any Loan Party or any of its Subsidiaries shall fail to pay
any principal of, premium or interest on or any other amount
payable in respect of any Debt that is outstanding in a principal
or notional amount of at least $10,000,000 either individually or
in the aggregate (but excluding Debt outstanding hereunder) of
such Loan Party or such Subsidiary (as the case may be), when the
same becomes due and payable (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt;
or any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Debt and shall
continue after the applicable grace period, if any, specified in
such agreement or instrument, if the effect of such event or
condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the
holder thereof to cause, such Debt to mature; or any such Debt
shall be declared to be due and payable or required to be prepaid
or redeemed (other than by a regularly scheduled required
prepayment or redemption), purchased or defeased, or an offer to
prepay, redeem, purchase or defease such Debt shall be required
to be made, in each case prior to the stated maturity thereof; or
(f) any Loan Party or any of its Material Subsidiaries shall
generally not pay its debts as such debts become due, or shall
admit in writing its inability to pay its debts generally, or
shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against any Loan Party
or any of its Material Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a
receiver, trustee, or other similar official for it or for any
substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that
is being diligently contested by it in good faith, either such
proceeding shall remain undismissed or unstayed for a period of
60 days or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or any substantial part of its
property) shall occur; or any Loan Party or any of its Material
Subsidiaries shall take any corporate action to authorize any of
the actions set forth above in this subsection (f); or
(g)any judgment or order for the payment of money in excess of
$10,000,000 shall be rendered against any Loan Party or any of
its Material Subsidiaries and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or
order or (ii) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in effect;
provided, however, that any such judgment or order shall not be
an Event of Default under this Section 6.01(g) if and to the
extent that the amount of such judgment or order is covered by a
valid and binding policy of insurance between the defendant and
the insurer covering payment thereof so long as such insurer,
which shall be rated at least "A" by A.M. Best Company, has been
notified of, and has not disputed the claim made for payment of,
the amount of such judgment or order; or
(h)any non-monetary judgment or order shall be rendered against
any Loan Party or any of its Material Subsidiaries that is
reasonably likely to have a Material Adverse Effect, and there
shall be any period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(i)any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 or 5.01(k) shall for any reason cease to
be valid and binding on or enforceable against any Loan Party
party to it, or any such Loan Party shall so state in writing; or
(j)any Collateral Document after delivery thereof pursuant to
Section 3.01 or 5.01(k) shall for any reason (other than pursuant
to the terms thereof or as a result of action taken or failure to
take action by the Agent or any Lender Party) cease to create a
valid and perfected first priority lien on and security interest
in the Collateral purported to be covered thereby; or
(k)(i) any Person or two or more Persons acting in concert shall
have acquired beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934), directly or indirectly, of
Voting Stock of Crompton Corp. (or other securities convertible
into such Voting Stock) representing 20% or more of the combined
voting power of all Voting Stock of Crompton Corp.; or
(ii) during any period of up to 24 consecutive months, commencing
before or after the date of this Agreement, individuals who at
the beginning of such 24-month period were directors of Crompton
Corp. shall cease for any reason to constitute a majority of the
board of directors of Crompton Corp. (except to the extent that
individuals who at the beginning of such 24-month period were
replaced by individuals (x) elected by 66-2/3% of the remaining
members of the board of directors of Crompton Corp. or
(y) nominated for election by a majority of the remaining members
of the board of directors of Crompton Corp. and thereafter
elected as directors by the shareholders of Crompton Corp.); or
(iii) Crompton Corp. shall at any time for any reason cease to be
the record and beneficial owner of 100% of the capital stock of
the other Borrowers; or
(l)(i) any ERISA Event shall have occurred with respect to a
Plan; (ii) the sum (determined as of the date of occurrence of
such ERISA Event) of the Insufficiency of such Plan and the
Insufficiency of any and all other Plans with respect to which an
ERISA Event shall have occurred and then exist exceeds
$10,000,000; and (iii) such ERISA Events (considered in the
aggregate) are reasonably likely to result in obligations on the
part of the Loan Parties to make payments in the aggregate in
excess of $10,000,000 in any given calendar year; or
(m)any Loan Party or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount
that, when aggregated with all other amounts required to be paid
to Multiemployer Plans by the Loan Parties and the ERISA
Affiliates as Withdrawal Liability (determined as of the date of
such notification), requires payments exceeding $10,000,000 in
any given calendar year; or
(n)any Loan Party or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, and as a result of such
reorganization or termination the aggregate annual contributions
of the Loan Parties and the ERISA Affiliates to all Multiemployer
Plans that are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such
Multiemployer Plans for the plan years of such Multiemployer
Plans immediately preceding the plan year in which such
reorganization or termination occurs by an amount exceeding
$10,000,000;
then, and in any such event, the Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to
the Borrowers, declare the Commitment of each Lender Party and
the obligation of each Appropriate Lender to make Advances (other
than Letter of Credit Advances by an Issuing Bank or a Working
Capital Lender pursuant to Section 2.03(c) and Swing Line
Advances by a Working Capital Lender pursuant to Section 2.02(b))
and of each Issuing Bank to issue Letters of Credit to be
terminated, whereupon the same shall forthwith terminate, and
(ii) shall at the request, or may with the consent, of the
Required Lenders, by notice to the Borrowers, declare the Notes,
all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and
payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by each Borrower; provided,
however, that in the event of an actual or deemed entry of an
order for relief with respect to any Loan Party or any of its
Subsidiaries under the Federal Bankruptcy Code, (x) the
Commitment of each Lender Party and the obligation of each Lender
to make Advances (other than Letter of Credit Advances by an
Issuing Bank or a Working Capital Lender pursuant to Section
2.03(c) and Swing Line Advances by a Working Capital Lender
pursuant to Section 2.02(b)) and of each Issuing Bank to issue
Letters of Credit shall automatically be terminated and (y) the
Notes, all such interest and all such amounts shall automatically
become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby
expressly waived by each Borrower.
SECTION 6.02. Actions in Respect of the Letters of Credit upon
Default. If any Event of Default shall have occurred and be
continuing, the Agent shall at the request, or may with the
consent, of the Required Lenders, irrespective of whether it is
taking any of the actions described in Section 6.01 or otherwise,
make demand upon the Borrowers to, and forthwith upon such demand
the Borrowers jointly and severally agree to, pay to the Agent on
behalf of the Lender Parties in same day funds at the Agent's
office designated in such demand, for deposit in the relevant L/C
Cash Collateral Account, an amount equal to the aggregate
Available Amount of all Letters of Credit then outstanding. If
at any time the Agent determines that any funds held in such L/C
Cash Collateral Account are subject to any right or claim of any
Person other than the Agent and the Lender Parties or that the
total amount of such funds is less than the aggregate Available
Amount of all Letters of Credit, the Borrowers jointly and
severally agree to, forthwith upon demand by the Agent, pay to
the Agent, as additional funds to be deposited and held in such
L/C Cash Collateral Account, an amount equal to the excess of
(a) such aggregate Available Amount over (b) the total amount of
funds, if any, then held in such L/C Cash Collateral Account that
the Agent determines to be free and clear of any such right and
claim.
SECTION 6.03. Actions in Respect of Working Capital B-1
Commitments Reserved Pursuant to Section 2.01(g). If, at any
time and from time to time, any Working Capital B-1 Commitments
are reserved pursuant to Section 2.01(g) and either (i) an Event
of Default shall have occurred and be continuing or (ii) the
Termination Date shall have occurred, then, upon the occurrence
of any of the events described in clause (i) or (ii) above,
Citibank may, whether in addition to the taking by the Agent of
any of the actions described in Section 6.01 or 6.02 or
otherwise, make demand upon the Uniroyal Borrower to, and
forthwith upon such demand the Uniroyal Borrower will, pay to
Citibank in same day funds at Citibank's office designated in
such demand, for deposit in a special cash collateral account to
be maintained in the name of Citibank Seoul and under the sole
dominion and control of Citibank at such place as shall be
designated by Citibank, an amount equal to the Seoul Guaranty
Amount on the date of such demand.
ARTICLE VII
THE AGENT
SECTION 7.01. Authorization and Action. Each Lender Party (in
its capacities as a Lender, a Swing Line Bank (if applicable), an
Issuing Bank (if applicable) and, on behalf of itself and its
Affiliates, a potential Hedge Bank) hereby appoints and
authorizes the Agent to take such action as agent on its behalf
and to exercise such powers and discretion under this Agreement
and the other Loan Documents as are delegated to the Agent by the
terms hereof and thereof, together with such powers and
discretion as are reasonably incidental thereto. As to any
matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of the
Notes), the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding upon all Lender
Parties and all holders of Notes; provided, however, that the
Agent shall not be required to take any action that exposes the
Agent to personal liability or that is contrary to this Agreement
or applicable law. The Agent agrees to give to each Lender Party
prompt notice of each notice given to it by any Borrower pursuant
to the terms of this Agreement.
SECTION 7.02. Agent's Reliance, Etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them under
or in connection with the Loan Documents, except for its or their
own gross negligence or willful misconduct. Without limitation
of the generality of the foregoing, the Agent: (a) may treat the
payee of any Note as the holder thereof until the Agent receives
and accepts an Assignment and Acceptance entered into by the
Lender that is the payee of such Note, as assignor, and an
Eligible Assignee, as assignee, as provided in Section 8.07;
(b) may consult with legal counsel (including counsel for any
Loan Party), independent public accountants and other experts
selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (c) makes no
warranty or representation to any Lender Party and shall not be
responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in
connection with the Loan Documents; (d) shall not have any duty
to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Loan Document on
the part of any Loan Party or to inspect the property (including
the books and records) of any Loan Party; (e) shall not be
responsible to any Lender Party for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of,
or the perfection or priority of any lien or security interest
created or purported to be created under or in connection with,
any Loan Document or any other instrument or document furnished
pursuant thereto; and (f) shall incur no liability under or in
respect of any Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by
telegram, telecopy or telex) believed by it to be genuine and
signed or sent by the proper party or parties.
SECTION 7.03. Citicorp and Affiliates. With respect to its
Commitments, the Advances made by it and the Notes issued to it,
Citicorp shall have the same rights and powers under the Loan
Documents as any other Lender Party and may exercise the same as
though it were not the Agent; and the term "Lender Party" or
"Lender Parties" shall, unless otherwise expressly indicated,
include Citicorp in its individual capacity. Citicorp and its
affiliates may accept deposits from, lend money to, act as
trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business
with, any Loan Party, any of its Subsidiaries and any Person who
may do business with or own securities of any Loan Party or any
such Subsidiary, all as if Citicorp were not the Agent and
without any duty to account therefor to the Lender Parties.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon
the Agent or any other Lender Party and based on the financial
statements referred to in Section 4.01 and such other documents
and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender
Party also acknowledges that it will, independently and without
reliance upon the Agent or any other Lender Party and based on
such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or
not taking action under this Agreement.
SECTION 7.05. Indemnification. (a) Each Lender Party severally
agrees to indemnify the Agent (to the extent not promptly
reimbursed by the Borrowers) from and against such Lender Party's
ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or
asserted against the Agent in any way relating to or arising out
of the Loan Documents or any action taken or omitted by the Agent
under the Loan Documents; provided, however, that no Lender Party
shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. Without limitation of the
foregoing, each Lender Party agrees to reimburse the Agent
promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of
counsel) payable by the Borrowers under Section 8.04, to the
extent that the Agent is not promptly reimbursed for such costs
and expenses by the Borrowers. For purposes of this
Section 7.05(a), the Lender Parties' respective ratable shares of
any amount shall be determined, at any time, according to their
respective Working Capital Commitments at such time. In the
event that any Defaulted Advance shall be owing by any Defaulting
Lender at any time, such Lender Party's Commitment with respect
to the Facility under which such Defaulted Advance was required
to have been made shall be considered to be unused for purposes
of this Section 7.05(a) to the extent of the amount of such
Defaulted Advance. The failure of any Lender Party to reimburse
the Agent promptly upon demand for its ratable share of any
amount required to be paid by the Lender Party to the Agent as
provided herein shall not relieve any other Lender Party of its
obligation hereunder to reimburse the Agent for its ratable share
of such amount, but no Lender Party shall be responsible for the
failure of any other Lender Party to reimburse the Agent for such
other Lender Party's ratable share of such amount.
(b)Each Lender Party severally agrees to indemnify each Issuing
Bank (to the extent not promptly reimbursed by the Borrowers)
from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such Issuing Bank in
any way relating to or arising out of the Loan Documents or any
action taken or omitted by such Issuing Bank under the Loan
Documents; provided, however, that no Lender Party shall be
liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from such Issuing Bank's gross negligence
or willful misconduct. Without limitation of the foregoing, each
Lender Party agrees to reimburse such Issuing Bank promptly upon
demand for its ratable share of any costs and expenses
(including, without limitation, fees and expenses of counsel)
payable by the Borrowers under Section 8.04, to the extent that
such Issuing Bank is not promptly reimbursed for such costs and
expenses by the Borrowers. For purposes of this Section 7.05(b),
the Lender Parties' respective ratable shares of any amount shall
be determined, at any time, according to their respective Working
Capital Commitments at such time. In the event that any
Defaulted Advance shall be owing by any Defaulting Lender at any
time, such Lender Party's Commitment with respect to the Facility
under which such Defaulted Advance was required to have been made
shall be considered to be unused for purposes of this
Section 7.05(b) to the extent of the amount of such Defaulted
Advance. The failure of any Lender Party to reimburse such
Issuing Bank promptly upon demand for its ratable share of any
amount required to be paid by the Lender Parties to such Issuing
Bank as provided herein shall not relieve any other Lender Party
of its obligation hereunder to reimburse such Issuing Bank for
its ratable share of such amount, but no Lender Party shall be
responsible for the failure of any other Lender Party to
reimburse such Issuing Bank for such other Lender Party's ratable
share of such amount.
(c)Without prejudice to the survival of any other agreement of
any Lender Party hereunder, the agreement and obligations of each
Lender Party contained in this Section 7.05 shall survive the
payment in full of principal, interest and all other amounts
payable hereunder and under the other Loan Documents.
SECTION 7.06. Successor Agents. The Agent may resign as to any
or all of the Facilities at any time by giving written notice
thereof to the Lender Parties and the Borrowers and may be
removed as to all of the Facilities at any time with or without
cause by the Required Lenders. Upon any such resignation or
removal, the Required Lenders shall have the right to appoint a
successor Agent as to such of the Facilities as to which the
Agent has resigned or been removed, subject, so long as no
Default shall have occurred and be continuing, to the consent of
Crompton Corp., such consent not to be unreasonably withheld or
delayed. If no successor Agent shall have been so appointed by
the Required Lenders, and shall have accepted such appointment,
within 30 days after the retiring Agent's giving of notice of
resignation or the Required Lenders' removal of the retiring
Agent, then the retiring Agent may, on behalf of the Lender
Parties, appoint a successor Agent, subject, so long as no
Default shall have occurred and be continuing, to the consent of
Crompton Corp., such consent not to be unreasonably withheld or
delayed, which shall be a commercial bank organized under the
laws of the United States or of any State thereof and having a
combined capital and surplus of at least $250,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor
Agent as to all of the Facilities and upon the execution and
filing or recording of such financing statements, or amendments
thereto, and such other instruments or notices, as may be
necessary or desirable, or as the Required Lenders may request,
in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such
successor Agent shall succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties
and obligations under the Loan Documents. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent as to
less than all of the Facilities and upon the execution and filing
or recording of such financing statements, or amendments thereto,
and such other instruments or notices, as may be necessary or
desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to be
granted by the Collateral Documents, such successor Agent shall
succeed to and become vested with all the rights, powers,
discretion, privileges and duties of the retiring Agent as to
such Facilities, other than with respect to funds transfers and
other similar aspects of the administration of Borrowings under
such Facilities, issuances of Letters of Credit (notwithstanding
any resignation as Agent with respect to the Letter of Credit
Facility) and payments by the Borrowers in respect of such
Facilities, and the retiring Agent shall be discharged from its
duties and obligations under this Agreement as to such
Facilities, other than as aforesaid. After any retiring Agent's
resignation or removal hereunder as Agent as to all of the
Facilities, the provisions of this Article VII shall inure to its
benefit as to any actions taken or omitted to be taken by it
while it was Agent as to any Facilities under this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Notes or any other Loan
Document, nor consent to any departure by any Borrower therefrom,
shall in any event be effective unless the same shall be in
writing and signed (or, in the case of the Collateral Documents,
consented to) by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however, that
(a) no amendment, waiver or consent shall, unless in writing and
signed by all of the Lenders, do any of the following at any
time: (i) waive any of the conditions specified in Section 3.01
or, in the case of the Initial Extension of Credit, Section 3.02,
(ii) change the number of Lenders or the percentage of (x) the
Commitments, (y) the aggregate unpaid principal amount of the
Advances or (z) the aggregate Available Amount of outstanding
Letters of Credit that, in each case, shall be required for the
Lenders or any of them to take any action hereunder, (iii) reduce
or limit the obligations of any Guarantor under Section 1 of the
Guaranty to which it is a party or otherwise limit such
Guarantor's liability with respect to the Obligations owing to
the Agent and the Lender Parties, (iv) release all or
substantially all of the Collateral in any transaction or series
of related transactions or permit the creation, incurrence,
assumption or existence of any Lien on all or substantially all
of the Collateral in any transaction or series of related
transactions to secure any Obligations other than Obligations
owing to the Secured Parties under the Loan Documents and other
than Debt owing to any other Person, provided that, in the case
of any Lien on all or substantially all of the Collateral to
secure Debt owing to any other Person, (A) such Lien shall be
subordinated to the Liens created under the Loan Documents on
terms acceptable to the Required Lenders and (B) the Required
Lenders shall otherwise permit the creation, incurrence,
assumption or existence of such Lien and, to the extent not
otherwise permitted under Section 5.02(b), of such Debt,
(v) amend this Section 8.01, or (vi) limit the liability of any
Loan Party under any of the Loan Documents and (b) no amendment,
waiver or consent shall, unless in writing and signed by the
Required Lenders and each Lender that has a Commitment under any
Working Capital Facility if affected by such amendment, waiver or
consent, (i) increase the Commitments of such Lender or subject
such Lender to any additional obligations, (ii) reduce the
principal of, or interest on, the Notes held by such Lender or
any fees or other amounts payable hereunder to such Lender,
(iii) postpone any date fixed for any payment or prepayment of
principal of, or interest on, the Notes held by such Lender or
any fees or other amounts payable hereunder to such Lender or
(iv) change the order of application of any prepayment set forth
in Section 2.06 in any manner that materially affects such
Lender; provided further that no amendment, waiver or consent
shall, unless in writing and signed by the Swing Line Bank or
each Issuing Bank, as the case may be, in addition to the Lenders
required above to take such action, affect the rights or
obligations of the Swing Line Bank or of the Issuing Banks, as
the case may be, under this Agreement; and provided further that
no amendment, waiver or consent shall, unless in writing and
signed by the Agent in addition to the Lenders required above to
take such action, affect the rights or duties of the Agent under
this Agreement.
SECTION 8.02. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing
(including telegraphic, telecopy or telex communication) and
mailed, telegraphed, telecopied, telexed or delivered, if to the
Borrowers, addressed both c/o Crompton Corp. at its address at
Xxx Xxxxxxx Xxxxx, Xxxxx Xxxxxx, Xxxxxxxx, XX 00000, Attention:
Chief Financial Officer and c/o Uniroyal Corp. at its address at
World Headquarters, Xxxxxx Road, Middlebury, CT 06749,
Attention: Chief Financial Officer; if to any Initial Lender or
any Initial Issuing Bank, at its Domestic Lending Office
specified opposite its name on Schedule I hereto; if to any other
Lender Party, at its Domestic Lending Office specified in the
Assignment and Acceptance pursuant to which it became a Lender
Party; and if to the Agent, at its address at 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxxx; or, as to
the Borrowers or the Agent, at such other address as shall be
designated by such party in a written notice to the other parties
and, as to each other party, at such other address as shall be
designated by such party in a written notice to the Borrowers and
the Agent. All such notices and communications shall (a) when
mailed, be effective three Business Days after the same is
deposited in the mails, (b) when mailed for next day delivery by
a reputable freight company or reputable overnight courier
service, be effective one Business Day thereafter, and (c) when
sent by telegraph, telecopier or telex, be effective when the
same is confirmed by telephone, telecopier confirmation or return
telecopy or telex answerback, respectively, except that notices
and communications to the Agent pursuant to Article II, III or
VII shall not be effective until received by the Agent. Delivery
by telecopier of an executed counterpart of any amendment or
waiver of any provision of this Agreement or the Notes or of any
Exhibit hereto to be executed and delivered hereunder shall be
effective as delivery of a manually executed counterpart thereof.
Delivery of a notice from any Borrower pursuant to Section
5.03(a) shall be deemed, solely with respect to such Section,
notice from all Borrowers.
SECTION 8.03. No Waiver; Remedies. No failure on the part of
any Lender Party or the Agent to exercise, and no delay in
exercising, any right hereunder or under any Note shall operate
as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or
the exercise of any other right. The remedies herein provided
are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrowers jointly
and severally agree to pay on demand (i) all costs and expenses
of the Agent in connection with the preparation, execution,
delivery, administration, modification and amendment of the Loan
Documents (including, without limitation, (A) all due diligence,
collateral review, syndication, transportation, computer,
duplication, appraisal, audit, insurance, consultant, search,
filing and recording fees and expenses and (B) the reasonable
fees and expenses of counsel for the Agent with respect thereto,
with respect to advising the Agent as to its rights and
responsibilities, or the perfection, protection or preservation
of rights or interests, under the Loan Documents, with respect to
negotiations with any Loan Party or with other creditors of any
Loan Party or any of its Subsidiaries arising out of any Default
or any events or circumstances that may give rise to a Default
and with respect to presenting claims in or otherwise
participating in or monitoring any bankruptcy, insolvency or
other similar proceeding involving creditors' rights generally
and any proceeding ancillary thereto) and (ii) all costs and
expenses of the Agent and the Lender Parties in connection with
the enforcement of the Loan Documents, whether in any action,
suit or litigation, any bankruptcy, insolvency or other similar
proceeding affecting creditors' rights generally (including,
without limitation, the reasonable fees and expenses of counsel
for the Agent and each Lender Party with respect thereto).
(b)The Borrowers jointly and severally agree to indemnify and
hold harmless the Agent, each Lender Party and each of their
Affiliates and their officers, directors, employees, agents and
advisors (each, an "Indemnified Party") from and against any and
all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that
may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by
reason of, or in connection with the preparation for a defense
of, any investigation, litigation or proceeding arising out of,
related to or in connection with (i) the Facilities, the actual
or proposed use of the proceeds of the Advances or the Letters of
Credit, the Loan Documents or any of the transactions
contemplated thereby, including, without limitation, any
acquisition or proposed acquisition (including, without
limitation, the Merger and any of the other transactions
contemplated hereby) by Crompton Corp. or any of its Subsidiaries
or Affiliates of all or any portion of the stock or substantially
all the assets of Uniroyal Corp. or any of its Subsidiaries or
(ii) the actual or alleged presence of Hazardous Materials on any
property of any Loan Party or any of its Subsidiaries or any
Environmental Action relating in any way to any Loan Party or any
of its Subsidiaries, except to the extent such claim, damage,
loss, liability or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful
misconduct. In the case of any investigation, litigation or
other proceeding to which the indemnity in this Section 8.04(b)
applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any Loan
Party, its directors, shareholders or creditors or an Indemnified
Party or any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are
consummated. The Borrowers also jointly and severally agree not
to assert any claim against the Agent, any Lender Party or any of
their Affiliates, or any of their respective officers, directors,
employees, attorneys and agents, on any theory of liability, for
special, indirect, consequential or punitive damages arising out
of or otherwise relating to the Facilities, the actual or
proposed use of the proceeds of the Advances or the Letters of
Credit, the Loan Documents or any of the transactions
contemplated thereby.
(c)If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by any Borrower to or for the
account of a Lender Party other than on the last day of the
Interest Period for such Advance, as a result of a payment or
Conversion pursuant to Section 2.09(b)(i) or 2.10(d),
acceleration of the maturity of the Notes pursuant to
Section 6.01 or for any other reason, or by an Eligible Assignee
to a Lender Party other than on the last day of the Interest
Period for such Advance upon an assignment of rights and
obligations under this Agreement pursuant to Section 8.07 as a
result of a demand by Crompton Corp. pursuant to Section 8.07(a),
such Borrower shall, upon demand by such Lender Party (with a
copy of such demand to the Agent), pay to the Agent for the
account of such Lender Party any amounts required to compensate
such Lender Party for any additional losses, costs or expenses
that it may reasonably incur as a result of such payment,
including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired
by any Lender Party to fund or maintain such Advance.
(d)If any Loan Party fails to pay when due any costs, expenses or
other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities,
such amount may be paid on behalf of such Loan Party by the Agent
or any Lender Party, in its sole discretion, and will result in
an increase in the amount owing by such Loan Party to the Agent
or such Lender Party.
(e)Without prejudice to the survival of any other agreement of
any Loan Party hereunder or under any other Loan Document, the
agreements and obligations of the Borrowers contained in
Sections 2.10 and 2.12 and this Section 8.04 shall survive the
payment in full of principal, interest and all other amounts
payable hereunder and under any of the other Loan Documents.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making
of the request or the granting of the consent specified by
Section 6.01 to authorize the Agent to declare the Notes due and
payable pursuant to the provisions of Section 6.01, each Lender
Party and each of its respective Affiliates is hereby authorized
at any time and from time to time, to the fullest extent
permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing
by such Lender Party or such Affiliate to or for the credit or
the account of any Borrower against any and all of the
Obligations of such Borrower now or hereafter existing under this
Agreement and the Note or Notes (if any) held by such Lender
Party, irrespective of whether such Lender Party shall have made
any demand under this Agreement or such Note or Notes and
although such obligations may be unmatured. Each Lender Party
agrees promptly to notify any Borrower after any such set-off and
application; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and
application. The rights of each Lender Party and its respective
Affiliates under this Section 8.05 are in addition to other
rights and remedies (including, without limitation, other rights
of set-off) that such Lender Party and its respective Affiliates
may have.
SECTION 8.06. Binding Effect. This Agreement shall become
effective when it shall have been executed by each Borrower and
the Agent and when the Agent shall have been notified by each
Initial Lender and each Initial Issuing Bank that such Initial
Lender and such Initial Issuing Bank has executed it and
thereafter shall be binding upon and inure to the benefit of each
Borrower, the Agent and each Lender Party and their respective
successors and assigns, except that no Borrower shall have the
right to assign its rights hereunder or any interest herein
without the prior written consent of the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender
may (and, so long as no Default shall have occurred and be
continuing, if demanded by Crompton Corp. (following a demand by
such Lender pursuant to Section 2.10 or 2.12 or if such Lender
shall be a Defaulting Lender) assign to one or more Eligible
Assignees all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion
of its Commitment or Commitments, the Advances owing to it and
the Note or Notes held by it); provided, however, that (i) each
such assignment shall be of a uniform, and not a varying,
percentage of all rights and obligations under and in respect of
all of the Facilities, (ii) except in the case of an assignment
to a Person that, immediately prior to such assignment, was a
Lender or an assignment of all of a Lender's rights and
obligations under this Agreement, the amount of the Commitment of
the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and
Acceptance with respect to such assignment) shall in no event be
less than $20,000,000 or, if the aggregate amount of the
Commitment of such assigning Lender is less than 20,000,000, all
of such Lender's Commitment, (iii) each such assignment shall be
to an Eligible Assignee, (iv) each such assignment made as a
result of a demand by Crompton Corp. pursuant to this
Section 8.07(a) shall be arranged by Crompton Corp. after
consultation with the Administrative Agent and shall be either an
assignment of all of the rights and obligations of the assigning
Lender under this Agreement and the other Loan Documents or an
assignment of a portion of such rights and obligations made
concurrently with another such assignment or other such
assignments that together cover all of the rights and obligations
of the assigning Lender under this Agreement and the other Loan
Documents, (v) no Lender shall be obligated to make any such
assignment as a result of a demand by Crompton Corp. pursuant to
this Section 8.07(a) unless and until such Lender shall have
received one or more payments from either the applicable
Borrowers or one or more Eligible Assignees in an aggregate
amount at least equal to the aggregate outstanding principal
amount of the Advances owing to such Lender, together with
accrued interest thereon to the date of payment of such principal
amount and all other amounts payable to such Lender under this
Agreement, (vi) no such assignments shall be permitted without
the consent of the Agent until the Agent shall have notified the
Lender Parties that syndication of the Commitments hereunder has
been completed, and (vii) the parties to each such assignment
shall execute and deliver to the Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together
with any Note or Notes subject to such assignment and a
processing and recordation fee of $3,500.
(b)Upon such execution, delivery, acceptance and recording, from
and after the effective date specified in such Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have
been assigned to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender or Issuing Bank, as
the case may be, hereunder and (y) the Lender or Issuing Bank
assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released
from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's or Issuing Bank's rights and obligations
under this Agreement, such Lender or Issuing Bank shall cease to
be a party hereto).
(c)By executing and delivering an Assignment and Acceptance, the
Lender Party assignor thereunder and the assignee thereunder
confirm to and agree with each other and the other parties hereto
as follows: (i) other than as provided in such Assignment and
Acceptance, such assigning Lender Party makes no representation
or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document or the
execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the perfection or priority of any
lien or security interest created or purported to be created
under or in connection with, this Agreement or any other Loan
Document or any other instrument or document furnished pursuant
hereto or thereto; (ii) such assigning Lender Party makes no
representation or warranty and assumes no responsibility with
respect to the financial condition of any Borrower or any other
Loan Party or the performance or observance by any Loan Party of
any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto; (iii) such
assignee confirms that it has received a copy of this Agreement,
together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision
to enter into such Assignment and Acceptance; (iv) such assignee
will, independently and without reliance upon the Agent, such
assigning Lender Party or any other Lender Party and based on
such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee
confirms that it is an Eligible Assignee; (vi) such assignee
appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under the
Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers and discretion as are
reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to
be performed by it as a Lender or Issuing Bank, as the case may
be.
(d)The Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the
names and addresses of the Lender Parties and the Commitment
under each Facility of, and principal amount of the Advances
owing under each Facility to, each Lender Party from time to time
(the "Register"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error,
and the Borrowers, the Agent and the Lender Parties shall treat
each Person whose name is recorded in the Register as a Lender
Party hereunder for all purposes of this Agreement. The Register
shall be available for inspection by any Borrower or any Lender
Party at any reasonable time and from time to time upon
reasonable prior notice.
(e)Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender Party and an assignee, together with any Note
or Notes subject to such assignment, the Agent shall, if such
Assignment and Acceptance has been completed and is in
substantially the form of Exhibit C hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to
the Borrowers. In the case of any assignment by a Lender, within
five Business Days after its receipt of such notice, each
Borrower, at its own expense, shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note to
the order of such Eligible Assignee in an amount equal to the
Commitment assumed by it under a Facility pursuant to such
Assignment and Acceptance and, if the assigning Lender has
retained a Commitment hereunder under such Facility, a new Note
to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Note or Notes
shall be in an aggregate principal amount equal to the aggregate
principal amount of such surrendered Note or Notes, shall be
dated the effective date of such Assignment and Acceptance and
shall otherwise be in substantially the form of Exhibit X-0, X-0
or A-3 hereto, as the case may be.
f)Each Issuing Bank may assign to one or more Eligible Assignees
all or a portion of its rights and obligations under the undrawn
portion of its Letter of Credit Commitment at any time; provided,
however, that (i) except in the case of an assignment to a Person
that immediately prior to such assignment was an Issuing Bank or
an assignment of all of an Issuing Bank's rights and obligations
under this Agreement, the amount of the Letter of Credit
Commitment of the assigning Issuing Bank being assigned pursuant
to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall
in no event be less than $10,000,000 and shall be in an integral
multiple of $1,000,000 in excess thereof, (ii) each such
assignment shall be to an Eligible Assignee and (iii) the parties
to each such assignment shall execute and deliver to the Agent,
for its acceptance and recording in the Register, an Assignment
and Acceptance, together with a processing and recordation fee of
$3,500.
(g)Each Lender Party may sell participations to one or more
Persons (other than any Loan Party or any of its Affiliates) in
or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its
Commitments, the Advances owing to it and the Note or Notes (if
any) held by it); provided, however, that (i) such Lender Party's
obligations under this Agreement (including, without limitation,
its Commitments) shall remain unchanged, (ii) such Lender Party
shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Lender Party
shall remain the holder of any such Note for all purposes of this
Agreement, (iv) the Borrowers, the Agent and the other Lender
Parties shall continue to deal solely and directly with such
Lender Party in connection with such Lender Party's rights and
obligations under this Agreement and (v) no participant under any
such participation shall have any right to approve any amendment
or waiver of any provision of any Loan Document, or any consent
to any departure by any Loan Party therefrom, except to the
extent that such amendment, waiver or consent would reduce the
principal of, or interest on, the Notes or any fees or other
amounts payable hereunder, in each case to the extent subject to
such participation, postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other
amounts payable hereunder, in each case to the extent subject to
such participation, or release all or substantially all of the
Collateral.
(h)Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to
this Section 8.07, disclose to the assignee or participant or
proposed assignee or participant, any information relating to the
Borrowers furnished to such Lender Party by or on behalf of the
Borrowers; provided, however, that, prior to any such disclosure,
the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any Confidential
Information received by it from such Lender Party.
(i)Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security
interest in all or any portion of its rights under this Agreement
(including, without limitation, the Advances owing to it and the
Note or Notes held by it) in favor of any Federal Reserve Bank in
accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
SECTION 8.08. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.09. No Liability of the Issuing Banks. Each Borrower
assumes all risks of the acts or omissions of any beneficiary or
transferee of any Letter of Credit with respect to its use of
such Letter of Credit. Neither any Issuing Bank nor any of its
officers or directors shall be liable or responsible for:
(a) the use that may be made of any Letter of Credit or any acts
or omissions of any beneficiary or transferee in connection
therewith; (b) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such documents
should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by such Issuing Bank against
presentation of documents that do not comply with the terms of a
Letter of Credit, including failure of any documents to bear any
reference or adequate reference to the Letter of Credit; or
(d) any other circumstances whatsoever in making or failing to
make payment under any Letter of Credit, except that the relevant
Borrower shall have a claim against such Issuing Bank, and such
Issuing Bank shall be liable to such Borrower, to the extent of
any direct, but not consequential, damages suffered by such
Borrower that such Borrower proves were caused by (i) such
Issuing Bank's willful misconduct or gross negligence in
determining whether documents presented under any Letter of
Credit comply with the terms of the Letter of Credit or (ii) such
Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and
certificates strictly complying with the terms and conditions of
the Letter of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Bank may accept documents that appear
on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the
contrary.
SECTION 8.10. Release of Collateral. As soon as practicable
after the Collateral Release Date, the Agent shall, at the
expense of the Borrowers, execute and deliver to Crompton Corp.
such documents as Crompton Corp. shall reasonably request to
evidence the release of the Collateral from the liens and
security interest created under the Collateral Documents.
SECTION 8.11. Confidentiality. Neither the Agent nor any Lender
Party shall disclose any Confidential Information to any Person
without the consent of Crompton Corp., other than (a) to the
Agent's or such Lender Party's Affiliates and their officers,
directors, partners, employees, agents and advisors and to actual
or prospective Eligible Assignees and participants, and then only
on a confidential basis, (b) as required by any law, rule or
regulation or judicial process, provided that, other than with
respect to Confidential Information otherwise permitted to be
disclosed pursuant to clause (d) below, the Agent or such Lender
Party shall, unless prohibited by applicable law or regulation or
court order, give notice to Crompton Corp. of any such
requirement to disclose such Confidential Information, and, if
practicable, such notice shall be given prior to such disclosure,
provided, however, that the failure to give such notice shall not
prohibit such disclosure, (c) to any rating agency when required
by it, provided that, prior to any such disclosure, such rating
agency shall undertake to preserve the confidentiality of any
Confidential Information relating to the Borrowers received by it
from such Lender Party and (d) as requested or required by any
state, federal or foreign authority or examiner or the National
Association of Insurance Commissioners or any state or federal
authority regulating such Lender Party.
SECTION 8.12. Jurisdiction, Etc. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself
and its property, to the nonexclusive jurisdiction of any New
York State court or federal court of the United States of America
sitting in New York City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating
to this Agreement or any of the other Loan Documents to which it
is a party, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New
York State court or, to the extent permitted by law, in such
federal court. Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement
shall affect any right that any party may otherwise have to bring
any action or proceeding relating to this Agreement or any of the
other Loan Documents in the courts of any jurisdiction.
(b)Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do
so, any objection that it may now or hereafter have to the laying
of venue of any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Loan Documents to
which it is a party in any New York State or federal court. Each
of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to
the maintenance of such action or proceeding in any such court.
SECTION 8.13. Governing Law. This Agreement and the Notes shall
be governed by, and construed in accordance with, the laws of the
State of New York.
SECTION 8.14. Waiver of Jury Trial. Each of the Borrowers, the
Agent and the Lender Parties irrevocably waives all right to
trial by jury in any action, proceeding or counterclaim (whether
based on contract, tort or otherwise) arising out of or relating
to any of the Loan Documents, the Advances or the actions of the
Agent or any Lender Party in the negotiation, administration,
performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
CROMPTON & XXXXXXX
CORPORATION
By /s/Xxxxx Xxxxx/Xxxxxxx X. Xxxxxxx
Title:
CROMPTON & XXXXXXX COLORS
INCORPORATED
By /s/Xxxxx Xxxxx
Title:
XXXXX-STANDARD CORPORATION
By /s/Xxxxx Xxxxx
Title:
INGREDIENT TECHNOLOGY
CORPORATION
By /s/Xxxxx Xxxxx
Title:
UNIROYAL CHEMICAL COMPANY,
INC.
By /s/Xxxxx Xxxxxxxxxx
Title: Treasurer
CITICORP SECURITIES, INC.,
as Arranger
By /s/Xxxxx X. Xxxxx
Title:
CITICORP USA, INC., as Agent
By /s/Xxxxx X. Karoko
Title:
THE CHASE MANHATTAN BANK,
as Managing Agent
By /s/Xxxxxx Xxxxx
Title:
Initial Lenders
CITICORP USA, INC.
By /s/Xxxxx X. Karoko
Title:
THE CHASE MANHATTAN BANK
By /s/Xxxxxx Xxxxx
Title:
ABN AMRO BANK, N.V., NEW YORK
BRANCH
By /s/Xxxxx X. Xxxxxxx
Title: Xxxxx X. Xxxxxxx, Group VP
By /s/Xxxxx X. Xxxxx
Title: Xxxxx X. Xxxxx, Assistant VP
BANCA COMMERCIALE ITALIANA -
NEW YORK BRANCH
By /s/Xxxxxxx Xxxxxxxxx
Title: Vice President
By /s/Xxxxx Xxxxxxx
Title: Assistant Vice President
BANK OF AMERICA ILLINOIS
By /s/Xxxxx X. Xxxxxx
Title: Xxxxx X. Xxxxxx, Vice President
THE BANK OF NEW YORK
By /s/Xxxxx X. Judge
Title: Vice President
BANK OF BOSTON CONNECTICUT
By /s/Xxxxx Xxxxxx
Title: Senior Vice President
BHF - BANK AKTIENGESELLSCHAFT
By /s/Xxxxx Xxxx
Title: AVP
CIBC, INC.
By /s/Xxxx Xxxxxxxx
Title:
CORESTATES BANK, N.A.
By /s/Xxxxx X. Xxxxx
Title: Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By /s/Xxxx Xxxxxx
Title: Vice President
FIRST UNION NATIONAL BANK
By /s/Xxxxxx Xxxxxx
Title: Vice President
FLEET NATIONAL BANK
By /s/Xxxxxx X. Xxxxxx
Title: Vice President
SOCIETE GENERALE
By /s/Xxxxxxxxx Galatiota
Title: First Vice President
TORONTO DOMINION (NEW YORK), INC.
By /s/Xxxxx Xxxxxx
Title: Vice President
Initial Issuing Banks
CITIBANK, N.A.
By /s/Xxxxx X. Xxxxx
Title:
BANK OF BOSTON CONNECTICUT
By /s/Xxxxxx Xxxxxx
Title: Senior Vice President
