_______________________________________________________________________________
_______________________________________________________________________________
CREDIT AGREEMENT
among
OMNIQUIP INTERNATIONAL, INC.,
VARIOUS LENDING INSTITUTIONS,
XXXXXX XXXXXXX SENIOR FUNDING, INC.,
as Syndication Agent and Arranger,
and
FIRST UNION NATIONAL BANK,
as Administrative Agent and Co-Arranger
__________________________________
Dated as of November 17, 1997
__________________________________
$165,000,000
_______________________________________________________________________________
_______________________________________________________________________________
TABLE OF CONTENTS
Page
SECTION 1. Xxxxxx and Terms of Credit................................. 1
1.01 The Commitments............................................ 1
1.02 Minimum Amount of Each Borrowing........................... 4
1.03 Notice of Borrowing........................................ 4
1.04 Disbursement of Funds...................................... 5
1.05 Notes...................................................... 6
1.06 Conversions................................................ 7
1.07 Pro Rata Borrowings........................................ 8
1.08 Interest................................................... 8
1.09 Interest Periods........................................... 9
1.10 Increased Costs, Illegality, etc........................... 10
1.11 Breakage................................................... 13
1.12 Change of Lending Office................................... 13
1.13 Replacement of Banks....................................... 13
SECTION 2. Letters of Credit.......................................... 15
2.01 Letters of Credit.......................................... 15
2.02 Maximum Letter of Credit Outstandings; Final Maturities.... 16
2.03 Letter of Credit Requests.................................. 17
2.04 Letter of Credit Participations............................ 17
2.05 Agreement to Repay Letter of Credit Drawings............... 19
2.06 Increased Costs............................................ 20
SECTION 3. Commitment Commission; Fees; Reductions of Commitment...... 21
3.01 Fees....................................................... 21
3.02 Voluntary Termination of Unutilized Commitments............ 22
3.03 Mandatory Reduction of Commitments......................... 23
SECTION 4. Prepayments; Payments; Taxes............................... 24
4.01 Voluntary Prepayments...................................... 24
4.02 Mandatory Repayments and Commitment Reductions............. 25
4.03 Method and Place of Payment................................ 30
(i)
4.04 Net Payments............................................... 30
SECTION 5. Conditions Precedent to Initial Credit Events.............. 32
5.01 Execution of Agreement; Notes.............................. 32
5.02 Officer's Certificate...................................... 32
5.03 Opinions of Counsel........................................ 32
5.04 Corporate Documents; Proceedings; etc...................... 32
5.05 Employee Benefit Plans; Shareholders' Agreements;
Management Agreements; Collective Bargaining
Agreements; Existing Indebtedness Agreements........... 33
5.06 Consummation of Acquisition................................ 34
5.07 Refinancing................................................ 34
5.08 Adverse Change, etc........................................ 34
5.09 Litigation................................................. 35
5.10 Pledge Agreement........................................... 35
5.11 Security Agreement......................................... 35
5.12 Subsidiaries Guaranty...................................... 36
5.13 Mortgages; Title Insurance; Survey; etc.................... 36
5.14 Projections; Pro Forma Balance Sheet....................... 37
5.15 Solvency Certificate; Insurance Certificates............... 37
5.16 Fees, etc.................................................. 37
SECTION 6. Conditions Precedent to All Credit Events.................. 37
6.01 No Default; Representations and Warranties................. 37
6.02 Notice of Borrowing; Letter of Credit Request.............. 38
SECTION 7. Representations, Warranties and Agreements................. 38
7.01 Corporate and Other Status................................. 38
7.02 Corporate and Other Power and Authority.................... 39
7.03 No Violation............................................... 39
7.04 Approvals.................................................. 39
7.05 Financial Statements; Financial Condition;
Undisclosed Liabilities; Projections; etc............... 40
7.06 Litigation................................................. 41
7.07 True and Complete Disclosure............................... 41
7.08 Use of Proceeds; Margin Regulations........................ 42
7.09 Tax Returns and Payments................................... 42
7.10 Compliance with ERISA...................................... 42
7.11 The Security Documents..................................... 44
7.12 Representations and Warranties in Acquisition Documents.... 45
(ii)
7.13 Properties................................................. 45
7.14 Capitalization............................................. 45
7.15 Subsidiaries............................................... 45
7.16 Compliance with Statutes, etc.............................. 45
7.17 Investment Company Act..................................... 46
7.18 Public Utility Holding Company Act......................... 46
7.19 Environmental Matters...................................... 46
7.20 Labor Relations............................................ 47
7.21 Patents, Licenses, Franchises and Formulas................. 47
7.22 Indebtedness............................................... 47
7.23 Transaction................................................ 48
SECTION 8. Affirmative Covenants...................................... 48
8.01 Information Covenants...................................... 48
8.02 Books, Records and Inspections............................. 51
8.03 Maintenance of Property; Insurance......................... 51
8.04 Corporate Franchises....................................... 52
8.05 Compliance with Statutes, etc.............................. 52
8.06 Compliance with Environmental Laws......................... 52
8.07 ERISA...................................................... 53
8.08 End of Fiscal Years; Fiscal Quarters....................... 54
8.09 Performance of Obligations................................. 54
8.10 Payment of Taxes........................................... 54
8.11 Interest Rate Protection................................... 55
8.12 Additional Security; Further Assurances.................... 55
8.13 Foreign Subsidiaries Security.............................. 55
8.14 Change of Name............................................. 56
SECTION 9. Negative Covenants......................................... 57
9.01 Liens...................................................... 57
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc..... 59
9.03 Dividends.................................................. 61
9.04 Indebtedness............................................... 62
9.05 Advances, Investments and Loans............................ 63
9.06 Transactions with Affiliates............................... 64
9.07 Capital Expenditures....................................... 65
9.08 Consolidated Fixed Charge Coverage Ratio................... 65
9.09 Consolidated Interest Coverage Ratio....................... 65
9.10 Maximum Leverage Ratio..................................... 66
(iii)
9.11 Limitation on Voluntary Payments and Modifications
of Subordinated Indebtedness; Modifications of
Certificate of Incorporation and Certain
Other Agreements; etc.................................. 66
9.12 Limitation on Certain Restrictions on Subsidiaries......... 67
9.13 Limitation on Issuance of Capital Stock.................... 67
9.14 Business................................................... 67
9.15 Limitation on Creation of Subsidiaries..................... 68
SECTION 10. Events of Default.......................................... 68
10.01 Payments................................................... 68
10.02 Representations, etc....................................... 68
10.03 Covenants.................................................. 68
10.04 Default Under Other Agreements............................. 69
10.05 Bankruptcy, etc............................................ 69
10.06 ERISA...................................................... 69
10.07 Security Documents......................................... 70
10.08 Subsidiaries Guaranty...................................... 70
10.09 Judgments.................................................. 70
10.10 Change of Control.......................................... 71
SECTION 11. Definitions and Accounting Terms........................... 71
11.01 Defined Terms.............................................. 71
SECTION 12. The Administrative Agent and the Syndication Agent........ 98
12.01 Appointment............................................... 98
12.02 Nature of Duties.......................................... 99
12.03 Lack of Reliance on the Administrative Agent
and the Syndication Agent............................... 99
12.04 Certain Rights of the Agents............................... 100
12.05 Reliance................................................... 100
12.06 Indemnification............................................ 100
12.07 The Administrative Agent and the Syndication
Agent in Their Individual Capacity...................... 101
12.08 Holders.................................................... 101
12.09 Resignation by the Administrative Agent and the
Syndication Agent....................................... 101
SECTION 13. Miscellaneous............................................. 102
13.01 Payment of Expenses, etc.................................. 102
13.02 Right of Setoff........................................... 103
13.03 Notices................................................... 104
(iv)
13.04 Benefit of Agreement; Assignments; Participations......... 104
13.05 No Waiver; Remedies Cumulative............................ 106
13.06 Payments Pro Rata......................................... 106
13.07 Calculations; Computations; Accounting Terms.............. 107
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL.................................... 107
13.09 Counterparts.............................................. 108
13.10 Effectiveness............................................. 109
13.11 Headings Descriptive...................................... 109
13.12 Amendment or Waiver; etc.................................. 109
13.13 Survival.................................................. 111
13.14 Domicile of Loans......................................... 111
13.15 Register.................................................. 111
13.16 Confidentiality........................................... 112
13.17 Limitation on Increased Costs............................. 112
SCHEDULE I Commitments
SCHEDULE II Bank Addresses
SCHEDULE III Real Property
SCHEDULE IV Indebtedness to be Refinanced
SCHEDULE V Subsidiaries
SCHEDULE VI Existing Indebtedness
SCHEDULE VII Insurance
SCHEDULE VIII Existing Liens
SCHEDULE IX Existing Investments
EXHIBIT A Notice of Borrowing
EXHIBIT B-1 A Term Note
EXHIBIT B-2 B Term Note
EXHIBIT B-3 Revolving Note
EXHIBIT B-4 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4.04(b)(ii) Certificate
EXHIBIT E Opinion of Dickstein, Xxxxxxx, Xxxxx & Xxxxxxxx LLP,
counsel to the Credit Parties
EXHIBIT F Officers' Certificate
EXHIBIT G Pledge Agreement
EXHIBIT H Security Agreement
EXHIBIT I Subsidiaries Guaranty
EXHIBIT J Solvency Certificate
(v)
EXHIBIT K Assignment and Assumption Agreement
EXHIBIT L Intercompany Note
EXHIBIT M Notice of Account Designation
(vi)
CREDIT AGREEMENT, dated as of November 17, 1997, among OMNIQUIP
INTERNATIONAL, INC., a Delaware corporation (the "Borrower"), the Banks party
hereto from time to time, XXXXXX XXXXXXX SENIOR FUNDING, INC., as Syndication
Agent and Arranger, and FIRST UNION NATIONAL BANK, as Administrative Agent and
Co-Arranger (all capitalized terms used herein and defined in Section 11 are
used herein as therein defined).
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions set forth
herein, the Banks are willing to make available to the Borrower the respective
credit facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
--------------------------
1.01 The Commitments. (a) Subject to and upon the terms and conditions
set forth herein, each Bank with a Term Loan Commitment severally agrees to
make, on the Initial Borrowing Date, a term loan or term loans (each a "Term
Loan" and, collectively, the "Term Loans") to the Borrower, which Term Loans (i)
shall, at the option of the Borrower, be incurred and maintained as, and/or
converted into, Base Rate Loans or Eurodollar Loans, provided that (A) except as
otherwise specifically provided in Section 1.10(b), all Term Loans comprising
the same Borrowing shall at all times be of the same Type and (B) no Term Loans
maintained as Eurodollar Loans may be incurred prior to the earlier of (1) the
30th day after the Initial Borrowing Date and (2) that date (the "Syndication
Date") upon which the Agents shall have determined in their sole discretion (and
shall have notified the Borrower) that the primary syndication (and resultant
addition of institutions as Banks pursuant to Section 13.04(b)) has been
completed and (ii) shall not exceed for any Bank that amount which equals the
Term Loan Commitment of such Bank on the Initial Borrowing Date (before giving
effect to any reduction thereto on such date pursuant to Section 3.03(b)(i) but
after giving effect to any reductions thereto on or prior to such date pursuant
to Section 3.03(b)(ii)). Once repaid, Term Loans incurred hereunder may not be
reborrowed.
(b) Subject to and upon the terms and conditions set forth herein,
each Bank with a Revolving Loan Commitment severally agrees, at any time and
from time to time on and after the Initial Borrowing Date and prior to the
Revolving Loan Maturity Date, to make
a revolving loan or revolving loans (each a "Revolving Loan" and, collectively,
the "Revolving Loans") to the Borrower, which Revolving Loans (i) shall, at the
option of the Borrower, be incurred and maintained as, and/or converted into,
Base Rate Loans or Eurodollar Loans, provided that (A) except as otherwise
specifically provided in Section 1.10(b), all Revolving Loans comprising the
same Borrowing shall at all times be of the same Type and (B) no Borrowings of
Revolving Loans maintained as Eurodollar Loans may be incurred prior to the
earlier of (1) the 30th day after the Initial Borrowing Date and (2) the
Syndication Date, (ii) may be repaid and reborrowed in accordance with the
provisions hereof, (iii) shall not exceed for any such Bank at any time
outstanding that aggregate principal amount which, when added to the product of
(x) such Bank's Adjusted RL Percentage and (y) the sum of (I) the aggregate
amount of all Letter of Credit Outstandings (exclusive of Unpaid Drawings which
are repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) at such time and (II) the aggregate
principal amount of all Swingline Loans (exclusive of Swingline Loans which are
repaid with the proceeds of, and simultaneously with the incurrence of, the
respective incurrence of Revolving Loans) then outstanding, equals the Revolving
Loan Commitment of such Bank at such time and (iv) shall not exceed for all
Banks at any time outstanding that aggregate principal amount which, when added
to (I) the amount of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously with the
incurrence of, the respective incurrence of Revolving Loans) at such time and
(II) the aggregate principal amount of all Swingline Loans (exclusive of
Swingline Loans which are repaid with the proceeds of, and simultaneously with
the incurrence of, the respective incurrence of Revolving Loans) then
outstanding, equals the Total Revolving Loan Commitment at such time.
(c) Subject to and upon the terms and conditions set forth herein, the
Swingline Bank agrees to make, at any time and from time to time on and after
the Initial Borrowing Date and prior to the Swingline Expiry Date, a revolving
loan or revolving loans (each a "Swingline Loan" and, collectively, the
"Swingline Loans") to the Borrower, which Swingline Loans (i) shall be made and
maintained as Base Rate Loans, (ii) may be repaid and reborrowed in accordance
with the provisions hereof, (iii) shall not exceed in aggregate principal amount
at any time outstanding, when combined with the aggregate principal amount of
all Revolving Loans made by Non-Defaulting Banks then outstanding and the Letter
of Credit Outstandings at such time, an amount equal to the Adjusted Total
Revolving Loan Commitment at such time (after giving effect to any reductions to
the Adjusted Total Revolving Loan Commitment on such date), and (iv) shall not
exceed in aggregate principal amount at any time outstanding the Maximum
Swingline Amount. Notwithstanding anything to the contrary contained in this
Section 1.01(c), the Swingline Bank shall not make any Swingline Loan after it
has received written notice from the Borrower or the Required Banks stating that
a Default or an Event of Default exists and is continuing until such time as the
Swingline Bank shall have received written notice (i) of rescission of all such
notices from the party or parties originally delivering such notice, (ii) of the
waiver of such Default or Event of Default by the Required Banks or
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(iii) that the Agents in good faith believe that such Default or Event of
Default no longer exists.
(d) On any Business Day, the Swingline Bank may, in its sole
discretion, give notice to the Banks that its outstanding Swingline Loans shall
be funded with one or more Borrowings of Revolving Loans (provided that such
notice shall be deemed to have been automatically given upon the occurrence of a
Default or an Event of Default under Section 10.05 or upon the exercise of any
of the remedies provided in the last paragraph of Section 10), in which case one
or more Borrowings of Revolving Loans constituting Base Rate Loans (each such
Borrowing, a "Mandatory Borrowing") shall be made on the immediately succeeding
Business Day by all Banks with a Revolving Loan Commitment (without giving
effect to any reductions thereto pursuant to the last paragraph of Section 10)
pro rata based on each such Bank's Adjusted RL Percentage (determined before
giving effect to any termination of the Revolving Loan Commitments pursuant to
the last paragraph of Section 10) and the proceeds thereof shall be applied
directly by the Swingline Bank to repay the Swingline Bank for such outstanding
Swingline Loans. Each such Bank hereby irrevocably agrees to make Revolving
Loans upon one Business Day's notice pursuant to each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and on the date
specified in writing by the Swingline Bank notwithstanding (i) that the amount
of the Mandatory Borrowing may not comply with the Minimum Borrowing Amount
otherwise required hereunder, (ii) any failure to satisfy any conditions
specified in Section 6, (iii) any Default or Event of Default existing on such
date, (iv) the date of such Mandatory Borrowing and (v) the amount of the Total
Revolving Loan Commitment or the Adjusted Total Revolving Loan Commitment at
such time. In the event that any Mandatory Borrowing cannot for any reason be
made on the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the Bankruptcy Code with
respect to the Borrower), then each such Bank hereby agrees that it shall
forthwith purchase (as of the date the Mandatory Borrowing would otherwise have
occurred, but adjusted for any payments received by the Swingline Bank from the
Borrower on or after such date and prior to such purchase) from the Swingline
Bank such participations in the outstanding Swingline Loans as shall be
necessary to cause such Banks to share in such Swingline Loans ratably based
upon their respective Adjusted RL Percentages (determined before giving effect
to any termination of the Revolving Loan Commitments pursuant to the last
paragraph of Section 10), provided that (x) all interest payable on the
Swingline Loans shall be for the account of the Swingline Bank until the date as
of which the respective participation is required to be purchased and, to the
extent attributable to the purchased participation, shall be payable to the
participant from and after such date and (y) at the time any purchase of
participations pursuant to this sentence is actually made, the purchasing Bank
shall be required to pay the Swingline Bank interest on the principal amount of
the participation purchased for each day from and including the day upon which
the Mandatory Borrowing would otherwise have occurred to but excluding the date
of payment for such participation, at the overnight Federal Funds Rate for the
first three days and at the rate otherwise
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applicable to Revolving Loans maintained as Base Rate Loans hereunder for each
day thereafter.
1.02 Minimum Amount of Each Borrowing. The aggregate principal amount
of each Borrowing of Loans under a respective Tranche shall not be less than the
Minimum Borrowing Amount for such Tranche and, if greater, shall be in integral
multiples of $100,000. More than one Borrowing may occur on the same date, but
at no time shall there be outstanding more than eight Borrowings of Eurodollar
Loans.
1.03 Notice of Borrowing . (a) Whenever the Borrower desires to incur
Loans hereunder (excluding Swingline Loans and Revolving Loans incurred pursuant
to a Mandatory Borrowing), the Borrower shall give the Administrative Agent at
its Notice Office at least one Business Day's prior notice of each Base Rate
Loan and at least three Business Days' prior notice of each Eurodollar Loan to
be incurred hereunder, provided that any such notice shall be deemed to have
been given on a certain day only if given before 12:00 Noon (Eastern time) on
such day. Each such notice (each a "Notice of Borrowing"), except as otherwise
expressly provided in Section 1.10, shall be irrevocable and shall be given by
the Borrower in writing, or by telephone promptly confirmed in writing, in the
form of Exhibit A, appropriately completed to specify the aggregate principal
amount of the Loans to be incurred pursuant to such Borrowing, the date of such
Borrowing (which shall be a Business Day), whether the Loans being incurred
pursuant to such Borrowing shall constitute Term Loans, or Revolving Loans and
whether the Loans being incurred pursuant to such Borrowing are to be initially
maintained as Base Rate Loans or Eurodollar Loans and, if Eurodollar Loans, the
initial Interest Period to be applicable thereto. The Administrative Agent shall
promptly give each Bank which is required to make Loans of the Tranche specified
in the respective Notice of Borrowing, notice of such proposed Borrowing, of
such Bank's proportionate share thereof and of the other matters required by the
immediately preceding sentence to be specified in the Notice of Borrowing.
(b)(i) Whenever the Borrower desires to incur Swingline Loans
hereunder, the Borrower shall give the Swingline Bank no later than 1:00 P.M.
(Eastern time) on the date that a Swingline Loan is to be incurred, written
notice or telephonic notice promptly confirmed in writing of each Swingline Loan
to be incurred hereunder. Each such notice shall be irrevocable and specify in
each case (A) the date of Borrowing (which shall be a Business Day) and (B) the
aggregate principal amount of the Swingline Loans to be incurred pursuant to
such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(d), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of the Mandatory Borrowings as set forth in
Section 1.01(d).
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(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice of any Borrowing or prepayment of
Loans, the Administrative Agent or the Swingline Bank, as the case may be, may
act without liability upon the basis of telephonic notice of such Borrowing or
prepayment, believed by the Administrative Agent or the Swingline Bank, as the
case may be, in good faith to be from the Chief Executive Officer, the
President, the Vice President-Finance, the Chief Financial Officer, the
Treasurer, any Assistant Treasurer or the Controller of the Borrower, or from
any other authorized person of the Borrower designated in writing by the
Borrower to the Administrative Agent as being authorized to give such notices,
prior to receipt of written confirmation. In each such case, the Borrower hereby
waives the right, absent manifest error, to dispute the Administrative Agent's
or the Swingline Bank's record of the terms of such telephonic notice of such
Borrowing or prepayment of Loans.
1.04 Disbursement of Funds. No later than 12:00 Noon (Eastern time)
on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, no later than 3:00 P.M. (Eastern time) on the date specified
pursuant to Section 1.03(b)(i), or (y) in the case of Mandatory Borrowings, no
later than 12:00 Noon (Eastern time) on the date specified in Section 1.01(d)),
each Bank with a Commitment of the respective Tranche will make available its
pro rata portion (determined in accordance with Section 1.07) of each such
Borrowing requested to be made on such date (or, in the case of Swingline Loans,
the Swingline Bank will make available the full amount thereof). All such
amounts will be made available in Dollars and in immediately available funds at
the Payment Office of the Administrative Agent, and the Administrative Agent
will make available to the Borrower at the Payment Office the aggregate of the
amounts so made available by the Banks (other than in respect of Mandatory
Borrowings) by delivery of such amounts to the Borrower's Account. Unless the
Administrative Agent shall have been notified by any Bank prior to the date of
Borrowing that such Bank does not intend to make available to the Administrative
Agent such Bank's portion of any Borrowing to be made on such date, the
Administrative Agent may assume that such Bank has made such amount available to
the Administrative Agent on such date of Borrowing and the Administrative Agent
may (but shall not be obligated to), in reliance upon such assumption, make
available to the Borrower a corresponding amount. If such corresponding amount
is not in fact made available to the Administrative Agent by such Bank, the
Administrative Agent shall be entitled to recover such corresponding amount on
demand from such Bank. If such Bank does not pay such corresponding amount
forthwith upon the Administrative Agent's demand therefor, the Administrative
Agent shall promptly notify the Borrower and the Borrower shall immediately pay
such corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover on demand from such Bank or the Borrower, as
the case may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the Administrative
Agent to the Borrower until the date such corresponding amount is recovered by
the Administrative Agent, at a rate per annum equal to (i) if recovered from
such Bank, the Federal Funds Rate for each day during the period consisting of
the first three Business Days
-5-
following such date of availability and thereafter at the Base Rate as in effect
from time to time and (ii) if recovered from the Borrower, the rate of interest
applicable to the respective Borrowing, as determined pursuant to Section 1.08.
Nothing in this Section 1.04 shall be deemed to relieve any Bank from its
obligation to make Loans hereunder or to prejudice any rights which the Borrower
may have against any Bank as a result of any failure by such Bank to make Loans
hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made by each Bank shall be evidenced (i) if Term
Loans, by promissory notes duly executed and delivered by the Borrower
substantially in the form of Exhibits B-1 (each an "A Term Note" and,
collectively, the "A Term Notes") and B-2 (each a "B Term Note" and,
collectively, the "B Term Notes" and, together with the A Term Notes, each a
"Term Note" and, collectively, the "Term Notes"), in each case with blanks
appropriately completed in conformity herewith, (ii) if Revolving Loans, by a
promissory note duly executed and delivered by the Borrower substantially in the
form of Exhibit B-3, with blanks appropriately completed in conformity herewith
(each a "Revolving Note" and, collectively, the "Revolving Notes") and (iii) if
Swingline Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-4, with blanks appropriately
completed in conformity herewith (the "Swingline Note").
(b) The Term Notes issued to each Bank that has a Term Loan
Commitment or outstanding Term Loans shall (i) be executed by the Borrower, (ii)
be payable to such Bank or its registered assigns and be dated the Initial
Borrowing Date (or, if issued after the Initial Borrowing Date, be dated the
date of the issuance thereof), (iii) be in a combined stated principal amount
equal to the Term Loan Commitment of such Bank on the Initial Borrowing Date
(before giving effect to the making of any Term Loans on such date by such Bank)
(or, if issued after the Initial Borrowing Date, be in a stated principal amount
equal to the outstanding principal amount of any Term Loans of such Bank at such
time) and be payable in the outstanding principal amount of Term Loans evidenced
thereby, provided that the combined stated principal amount of the B Term Notes
shall be $3,000,000 at all times during which the Term Loan Commitments exist or
Term Loans in excess of $3,000,000 remain outstanding, with such B Term Notes to
be issued to each Bank with a Term Loan Commitment or outstanding Term Loans in
amounts equal to such Bank's pro rata portion of the Term Loan obligations
represented by such B Term Notes, (iv) mature on the Term Loan Maturity Date,
(v) bear interest as provided in the appropriate clause of Section 1.08 in
respect of the Base Rate Loans and Eurodollar Loans, as the case may be,
evidenced thereby, (vi) be subject to voluntary prepayment as provided in
Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents,
provided that the A Term Notes shall not be entitled to the benefits of the
Minnesota Mortgage.
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(c) The Revolving Note issued to each Bank that has a Revolving Loan
Commitment or outstanding Revolving Loans shall (i) be executed by the Borrower,
(ii) be payable to such Bank or its registered assigns and be dated the Initial
Borrowing Date (or, if issued after the Initial Borrowing Date, be dated the
date of the issuance thereof), (iii) be in a stated principal amount equal to
the Revolving Loan Commitment of such Bank (or, if issued after the termination
thereof, be in a stated principal amount equal to the outstanding Revolving
Loans of such Bank at such time) and be payable in the outstanding principal
amount of the Revolving Loans evidenced thereby, (iv) mature on the Revolving
Loan Maturity Date, (v) bear interest as provided in the appropriate clause of
Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case
may be, evidenced thereby, (vi) be subject to voluntary prepayment as provided
in Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii)
be entitled to the benefits of this Agreement and the other Credit Documents.
(d) The Swingline Note issued to the Swingline Bank shall (i) be
executed by the Borrower, (ii) be payable to the Swingline Bank or its
registered assigns and be dated the Initial Borrowing Date, (iii) be in a stated
principal amount equal to the Maximum Swingline Amount and be payable in the
outstanding principal amount of the Swingline Loans evidenced thereby from time
to time, (iv) mature on the Swingline Expiry Date, (v) bear interest as provided
in the appropriate clause of Section 1.08 in respect of the Base Rate Loans
evidenced thereby, (vi) be subject to voluntary prepayment as provided in
Section 4.01, and mandatory repayment as provided in Section 4.02 and (vii) be
entitled to the benefits of this Agreement and the other Credit Documents.
(e) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in such notation shall not affect the Borrower's obligations in
respect of such Loans.
1.06 Conversions. The Borrower shall have the option to convert, on
any Business Day occurring after the Initial Borrowing Date, all or a portion
equal to at least the Minimum Borrowing Amount of the outstanding principal
amount of Loans (other than Swingline Loans, which may not be converted pursuant
to this Section 1.06) made pursuant to one or more Borrowings (so long as of the
same Tranche) of one or more Types of Loans into a Borrowing (of the same
Tranche) of another Type of Loan, provided that, (i) except as otherwise
provided in Section 1.10(b), Eurodollar Loans may be converted into Base Rate
Loans only on the last day of an Interest Period applicable to the Loans being
converted and no such partial conversion of Eurodollar Loans shall reduce the
outstanding principal amount of such Eurodollar Loans made pursuant to a single
Borrowing to less than the Minimum Borrowing Amount applicable thereto, (ii)
Base Rate Loans may only be converted into Eurodollar Loans if no Default or
Event of Default is in existence on the date of the conver-
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sion, and (iii) no conversions of Base Rate Loans into Eurodollar Loans shall be
permitted prior to the earlier of (x) the 30th day after the Initial Borrowing
Date and (y) the Syndication Date. Each such conversion shall be effected by the
Borrower by giving the Administrative Agent at its Notice Office prior to 12:00
Noon (Eastern time) at least three Business Days' prior notice (each a "Notice
of Conversion") specifying the Loans to be so converted, the Borrowing or
Borrowings pursuant to which such Loans were made and, if to be converted into
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Administrative Agent shall give each Bank prompt notice of any such proposed
conversion affecting any of its Loans. Upon any such conversion the proceeds
thereof will be deemed to be applied directly on the day of such conversion to
prepay the outstanding principal amount of the Loans being converted.
1.07 Pro Rata Borrowings. All Borrowings of Term Loans and Revolving
Loans under this Agreement shall be incurred from the Banks pro rata on the
basis of their Term Loan Commitments or Revolving Loan Commitments, as the case
may be, provided, that all Borrowings of Revolving Loans made pursuant to a
Mandatory Borrowing shall be incurred from the Banks with Revolving Loan
Commitments pro rata on the basis of their Adjusted RL Percentages. No Bank
shall be responsible for any default by any other Bank of its obligation to make
Loans hereunder and each Bank shall be obligated to make the Loans provided to
be made by it hereunder, regardless of the failure of any other Bank to make its
Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest in respect of
the unpaid principal amount of each Base Rate Loan from the date the proceeds
thereof are made available to the Borrower until the earlier of (i) the maturity
thereof (whether by acceleration or otherwise) and (ii) the conversion of such
Base Rate Loan into a Eurodollar Loan pursuant to Section 1.06, at a rate per
annum which shall be equal to the sum of the Applicable Base Rate Margin plus
the Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date the proceeds thereof are
made available to the Borrower until the earlier of (i) the maturity thereof
(whether by acceleration or otherwise) and (ii) the conversion of such
Eurodollar Loan into a Base Rate Loan pursuant to Section 1.06, 1.09 or 1.10, as
applicable, at a rate per annum which shall, during each Interest Period
applicable thereto, be equal to the sum of the Applicable Eurodollar Margin plus
the Eurodollar Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable hereunder
shall, in each case, bear interest at a rate per annum equal to 2% per annum in
excess of the rate otherwise applicable to Base Rate Loans of the respective
Tranche of Loans from time to time, provided that at no time shall any Loan bear
interest after maturity at a rate per annum which is less than 2% in
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excess of the rate applicable thereto at maturity without the application of the
preceding provisions of this Section 1.08(c), with such interest to be payable
on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i) in
respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment
Date, (ii) in respect of each Eurodollar Loan, on the last day of each Interest
Period applicable thereto and, in the case of an Interest Period in excess of
three months, on each date occurring at three month intervals after the first
day of such Interest Period and (iii) in respect of each Loan, on any repayment
or prepayment (on the amount repaid or prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative Agent
shall determine the Eurodollar Rate for each Interest Period applicable to
Eurodollar Loans and shall promptly notify the Borrower and the Banks thereof.
Each such determination shall, absent manifest error, be final and conclusive
and binding on all parties hereto.
1.09 Interest Periods. At the time it gives any Notice of Borrowing or
Notice of Conversion in respect of the making of, or conversion into, any
Eurodollar Loan (in the case of the initial Interest Period applicable thereto)
or on the third Business Day prior to the expiration of an Interest Period
applicable to such Eurodollar Loan (in the case of any subsequent Interest
Period), the Borrower shall have the right to elect, by giving the
Administrative Agent notice thereof, the interest period (each an "Interest
Period") applicable to such Eurodollar Loan, which Interest Period shall, at the
option of the Borrower (but subject to the limitation set forth in clause (B) of
the proviso in each of Sections 1.01(a)(i), and 1.01(b)(i), be a one, two, three
or six-month period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including the
date of any conversion thereto from a Loan of a different Type) and each
Interest Period occurring thereafter in respect of such Eurodollar Loan
shall commence on the day on which the immediately preceding Interest
Period applicable thereto expires;
(iii) if any Interest Period for a Eurodollar Loan begins on a day for
which there is no numerically corresponding day in the calendar month at
the end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;
(iv) if any Interest Period for a Eurodollar Loan would otherwise
expire on a day which is not a Business Day, such Interest Period shall
expire on the next
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succeeding Business Day; provided, however, that if any Interest Period for
a Eurodollar Loan would otherwise expire on a day which is not a Business
Day but is a day of the month after which no further Business Day occurs in
such month, such Interest Period shall expire on the next preceding
Business Day;
(v) no Interest Period may be selected at any time when a Default or
an Event of Default is then in existence;
(vi) no Interest Period in respect of any Borrowing of any Tranche of
Loans shall be selected which extends beyond the respective Maturity Date
for such Tranche of Loans; and
(vii) no Interest Period in respect of any Borrowing of Term Loans
shall be selected which extends beyond any date upon which a mandatory
repayment of such Term Loans will be required to be made under Section
4.02(b), if the aggregate principal amount of Term Loans which have
Interest Periods which will expire after such date will be in excess of the
aggregate principal amount of Term Loans then outstanding less the
aggregate amount of such required repayment.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to such Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to convert
such Eurodollar Loans into Base Rate Loans effective as of the expiration date
of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that any Bank
shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any changes
arising after the date of this Agreement affecting the interbank Eurodollar
market, adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any change since the date of this
Agreement in any applicable law or governmental rule, regulation, order,
guideline or request (whether or not having the force of law) or in the
interpretation or administration thereof and including the introduction of
any new law or governmental rule, regulation, order, guideline or request,
such as, for example, but not limited to: (A) a change in the basis of
taxation
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of payment to any Bank of the principal of or interest on the Notes or any
other amounts payable hereunder (except for changes in the rate of tax on,
or determined by reference to, the net income or profits of such Bank or
any change in a tax imposed solely on deposits or net assets of a Bank, in
each case pursuant to the laws of the jurisdiction in which it is organized
or in which its principal office or applicable lending office is located or
any subdivision thereof or therein) or (B) a change in official reserve
requirements, but, in all events, excluding reserves required under
Regulation D to the extent included in the computation of the Eurodollar
Rate and/or (y) other circumstances since the date of this Agreement
affecting the New York interbank Eurodollar market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan has been made (x) unlawful by any law or governmental rule, regulation
or order, (y) impossible by compliance by any Bank in good faith with any
governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the date of this
Agreement which materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Bank (or the Administrative Agent, in the case
of clause (i) above) shall promptly give notice (by telephone promptly confirmed
in writing) to the Borrower and, except in the case of clause (i) above, to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Banks). Thereafter (x) in the
case of clause (i) above, Eurodollar Loans shall no longer be available until
such time as the Administrative Agent notifies the Borrower and the Banks that
the circumstances giving rise to such notice by the Administrative Agent no
longer exist, and any Notice of Borrowing or Notice of Conversion given by the
Borrower with respect to Eurodollar Loans which have not yet been incurred
(including by way of conversion) shall be deemed rescinded by the Borrower, (y)
in the case of clause (ii) above, the Borrower shall, subject to the provisions
of this Section 1.10(a) and Section 13.17 (to the extent applicable), pay to
such Bank, within ten Business Days after such Bank's written request therefor
and the delivery to the Borrower of the written notice described below in this
clause (y), such additional amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Bank in its sole
discretion shall determine (but without duplication of any amounts that may be
payable to such Bank under Section 1.10(c) or 2.06) as shall be required to
compensate such Bank for such increased costs or reductions in amounts received
or receivable hereunder reasonably determined by such Bank in good faith (a
written notice as to the additional amounts owed to such Bank, showing in
reasonable detail the basis for the calculation thereof, submitted to the
Borrower by such Bank shall, absent manifest error, be final and conclusive and
binding on all the parties hereto) and (z) in the case of clause (iii) above,
the Borrower shall take one of the actions specified in Section 1.10(b) as
promptly as possible and, in any event, within the time period required by law.
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(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, by giving the Administrative
Agent telephonic notice (confirmed in writing) as promptly as practicable and in
any event within one Business Day after the date that the Borrower was notified
by the affected Bank or the Administrative Agent pursuant to Section 1.10(a)(ii)
or (iii) or (y) if the affected Eurodollar Loan is then outstanding, upon at
least three Business Days' written notice to the Administrative Agent, require
the affected Bank to convert such Eurodollar Loan into a Base Rate Loan,
provided that, if more than one Bank is affected at any time, then all affected
Banks must be treated the same pursuant to this Section 1.10(b).
(c) If at any time after the date of this Agreement any Bank
determines that the introduction of or any change (which introduction or change
shall have occurred after the date of this Agreement) in any applicable law or
governmental rule, regulation, order, guideline, directive or request (whether
or not having the force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by any governmental authority, central
bank, the NAIC or comparable agency, will have the effect of increasing the
amount of capital required or expected to be maintained by such Bank or any
corporation controlling such Bank based on the existence of such Bank's
Commitments hereunder or its obligations hereunder, then the Borrower shall,
subject to the provisions of this Section 1.10(c) and Section 13.17 (to the
extent applicable), pay to such Bank, within ten Business Days after its written
demand therefor, such additional amounts as shall be required to compensate such
Bank or such other corporation for the increased cost to such Bank or such other
corporation or the reduction in the rate of return to such Bank or such other
corporation as a result of such increase of capital (but without duplication of
any amounts that may be payable to such Bank under Section 1.10(a) or 2.06). In
determining such additional amounts, each Bank will act reasonably and in good
faith and will use averaging and attribution methods which are reasonable,
provided that such Bank's determination of compensation owing under this Section
1.10(c) shall, absent manifest error, be final and conclusive and binding on all
the parties hereto. Each Bank, upon determining that any additional amounts will
be payable pursuant to this Section 1.10(c), will give prompt written notice
thereof to the Borrower, which notice shall describe in reasonable detail the
introduction of or change in applicable law or governmental rule, regulation,
order, guideline, directive or request or change in interpretation or
administration and the basis for calculation of such additional amounts.
1.11 Breakage. The Borrower shall compensate each Bank, within ten
Business Days after its written request (which request shall set forth in
reasonable detail the basis for requesting such compensation), for all
reasonable losses, expenses and liabilities (including, without limitation, any
loss, expense or liability incurred by reason of the liquidation or reemployment
of deposits or other funds required by such Bank to fund its Eurodollar Loans
but excluding loss of anticipated profits) which such Bank may sustain: (i) if
for any
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reason (other than a default by such Bank or the Administrative Agent) a
Borrowing of, or conversion from or into, Eurodollar Loans does not occur on a
date specified therefor in a Notice of Borrowing or Notice of Conversion
(whether or not withdrawn by the Borrower or deemed withdrawn pursuant to
Section 1.10(a)); (ii) if any repayment (including any repayment made pursuant
to Section 4.01, 4.02 or as a result of an acceleration of the Loans pursuant to
Section 10) or conversion of any of its Eurodollar Loans occurs on a date which
is not the last day of an Interest Period with respect thereto; (iii) if any
prepayment of any of its Eurodollar Loans is not made on any date specified in a
notice of prepayment given by the Borrower; or (iv) as a consequence of (x) any
other default by the Borrower to repay its Loans when required by the terms of
this Agreement or any Note held by such Bank or (y) any election made pursuant
to Section 1.10(b). Each Bank agrees to use commercially reasonable efforts to
minimize its losses, expenses and liabilities described in this Section 1.11.
1.12 Change of Lending Office. Each Bank agrees that on the occurrence
of any event giving rise to the operation of Section 1.10(a)(ii) or (iii),
Section 1.10(c), Section 2.06 or Section 4.04 with respect to such Bank, it will
(subject to overall policy considerations of such Bank), if requested by the
Borrower, designate another Lending Office for any Loans or Letters of Credit
affected by such event, provided that such designation is made on such terms
that such Bank and its Lending Office suffer no economic, legal or regulatory
disadvantage which such Bank determines, in its sole discretion, to be adverse
in any material respect, with the object of avoiding the consequence of the
event giving rise to the operation of such Section. Nothing in this Section 1.12
shall affect or postpone any of the obligations of the Borrower or the right of
any Bank provided in Sections 1.10, 2.06 and 4.04.
1.13 Replacement of Banks. (a) If any Bank becomes a Defaulting Bank
or otherwise defaults in its obligations to make Loans or fund Unpaid Drawings,
(b) upon the occurrence of an event giving rise to the operation of Section
1.10(a)(ii) or (iii), Section 1.10(c), Section 2.06 or Section 4.04 with respect
to any Bank which results in such Bank charging to the Borrower increased costs
materially in excess of those being generally charged by the other Banks or (c)
in the case of a refusal by a Bank to consent to one or more proposed changes,
waivers, discharges or terminations with respect to this Agreement which have
been approved by the Required Banks as (and to the extent) provided in Section
13.12(b), the Borrower shall have the right, if no Default or Event of Default
then exists (or, in the case of preceding clause (c), no Default or Event of
Default will exist immediately after giving effect to such replacement), to
either (i) replace such Bank (the "Replaced Bank") with one or more other
Eligible Transferees (it being acknowledged that the Replaced Bank shall be
under no obligation to identify or secure the commitment of such Eligible
Transferee or assist in identifying or securing the commitment of such Eligible
Transferee), none of whom shall constitute a Defaulting Bank at the time of such
replacement and each of whom shall be reasonably acceptable to the
Administrative Agent (collectively, the "Replacement Bank") or (ii) at the
option of the Borrower, replace only (x) the Revolving Loan Commitment (and
outstandings pursuant thereto) of the Replaced Bank with an identical Revolving
Loan
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Commitment provided by the Replacement Bank or (y) in the case of a replacement
as provided in Section 13.12(b) where the consent of the respective Bank is
required with respect to less than all Tranches of its Loans or Commitments, the
Commitments and/or outstanding Term Loans of such Bank in respect of each
Tranche where the consent of such Bank would otherwise be individually required,
with identical Commitments and/or Term Loans of the respective Tranche provided
by the Replacement Bank, provided that (1) at the time of any replacement
pursuant to this Section 1.13, the Replacement Bank shall enter into one or more
Assignment and Assumption Agreements pursuant to Section 13.04(b) (and with all
fees payable pursuant to said Section 13.04(b) to be paid by the Replacement
Bank) pursuant to which the Replacement Bank shall acquire all of the
Commitments and outstanding Loans (or, in the case of the replacement of only
(I) the Revolving Loan Commitment, the Revolving Loan Commitment and outstanding
Revolving Loans and participations in outstanding Letters of Credit and/or (II)
the outstanding Term Loans, the Term Loans) of, and in each case participations
in Letters of Credit by, the Replaced Bank and, in connection therewith, shall
pay to (a) the Replaced Bank in respect thereof an amount equal to the sum of
(i) an amount equal to the principal of, and all accrued interest on, all
outstanding Loans (or of the Loans of the respective Tranche being replaced) of
the Replaced Bank, (ii) an amount equal to all Unpaid Drawings that have been
funded by (and not reimbursed to) such Replaced Bank, together with all then
unpaid interest with respect thereto at such time and (iii) an amount equal to
all accrued, but theretofore unpaid, Fees owing to the Replaced Bank (but only
with respect to the relevant Tranche, in the case of the replacement of less
than all Tranches of Loans then held by the respective Replaced Bank) pursuant
to Section 3.01, (b) except in the case of the replacement of only the
outstanding Term Loans of a Replaced Bank, each Issuing Bank an amount equal to
such Replaced Bank's Adjusted RL Percentage (for this purpose, determined as if
the adjustment described in clause (i) of the immediately succeeding sentence
had been made with respect to such Replaced Bank) of any Unpaid Drawing (which
at such time remains an Unpaid Drawing) to the extent such amount was not
theretofore funded by such Replaced Bank to such Issuing Bank and (c) except in
the case of the replacement of only the outstanding Term Loans of a Replaced
Bank, the Swingline Bank an amount equal to such Replaced Bank's Adjusted RL
Percentage of any Mandatory Borrowing to the extent such amount was not
theretofore funded by such Replaced Bank, and (2) all obligations of the
Borrower due and owing to the Replaced Bank at such time (other than those
specifically described in clause (1) above in respect of which the assignment
purchase price has been, or is concurrently being, paid) shall be paid in full
to such Replaced Bank concurrently with such replacement. Upon the execution of
the respective Assignment and Assumption Agreement, the payment of amounts
referred to in clauses (1) and (2) above and, if so requested by the Replacement
Bank, delivery to the Replacement Bank of the appropriate Note or Notes executed
by the Borrower, (i) the Replacement Bank shall become a Bank hereunder and,
unless the respective Replaced Bank continues to have outstanding Term Loans or
a Commitment hereunder, the Replaced Bank shall cease to constitute a Bank
hereunder, except with respect to indemnification provisions under this
Agreement (including, without limitation, Sections 1.10, 1.11, 2.06, 4.04, 12.06
and 13.01), which shall survive as to such Replaced Bank
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and (ii) except in the case of the replacement of only outstanding Term Loans of
a Replaced Bank, the Adjusted RL Percentages of the Banks shall be automatically
adjusted at such time to give effect to such replacement (and to give effect to
the replacement of a Defaulting Bank with one or more Non-Defaulting Banks).
Replacements pursuant to this Section 1.13 shall only be effected by assignments
which otherwise meet the applicable requirements of Section 13.04(b).
SECTION 2. Letters of Credit
2.01 Letters of Credit. (a) Subject to and upon the terms and
conditions set forth herein, the Borrower may request that any Issuing Bank
issue, at any time and from time to time on and after the Initial Borrowing Date
and prior to the 30th day prior to the Revolving Loan Maturity Date, (x) for the
account of the Borrower and for the benefit of any holder (or any trustee, agent
or other similar representative for any such holders) of L/C Supportable
Obligations of the Borrower or any of its Subsidiaries, an irrevocable standby
letter of credit, in a form customarily used by such Issuing Bank or in such
other form as has been approved by such Issuing Bank (each such standby letter
of credit, a "Standby Letter of Credit") in support of such L/C Supportable
Obligations and (y) for the account of the Borrower and for the benefit of
sellers of goods and materials used in the ordinary course of business of the
Borrower or any of its Subsidiaries an irrevocable sight commercial letter of
credit in a form customarily used by such Issuing Bank or in such other form as
has been approved by such Issuing Bank (each such commercial letter of credit, a
"Trade Letter of Credit", and each such Trade Letter of Credit and each Standby
Letter of Credit, a "Letter of Credit") in support of commercial transactions of
the Borrower and its Subsidiaries. All Letters of Credit shall be denominated in
Dollars.
(b) Subject to and upon the terms and conditions set forth herein,
each Issuing Bank hereby agrees that it will, at any time and from time to time
on and after the Initial Borrowing Date and prior to the 30th day prior to the
Revolving Loan Maturity Date, following its receipt of the respective Letter of
Credit Request, issue for the account of the Borrower, one or more Letters of
Credit (x) in the case of Standby Letters of Credit, in support of such L/C
Supportable Obligations of the Borrower or any of its Subsidiaries as are
permitted to remain outstanding without giving rise to a Default or an Event of
Default and (y) in the case of Trade Letters of Credit, in support of sellers of
goods or materials used in the ordinary course of business of the Borrower or
any of its Subsidiaries as referenced in Section 2.01(a), provided that the
respective Issuing Bank shall be under no obligation to issue any Letter of
Credit of the types described above if at the time of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing
Bank from issuing such Letter of Credit or any requirement of law
applicable to such Issuing Bank or any request or directive (whether or not
having the force of law) from any governmental
-16-
authority with jurisdiction over such Issuing Bank shall prohibit, or
request that such Issuing Bank refrain from, the issuance of letters of
credit generally or such Letter of Credit in particular or shall impose
upon such Issuing Bank with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuing Bank
is not otherwise compensated) not in effect on the date hereof, or any
unreimbursed loss, cost or expense which was not applicable, in effect or
known to such Issuing Bank as of the date hereof and which such Issuing
Bank reasonably and in good xxxxx xxxxx material to it; or
(ii) such Issuing Bank shall have received notice from the Required
Banks prior to the issuance of such Letter of Credit of the type described
in the penultimate sentence of Section 2.03(b) and the matters identified
in such notice have not previously been waived or cured.
2.02 Maximum Letter of Credit Outstandings; Final Maturities.
Notwithstanding anything to the contrary contained in this Agreement, (i) no
Letter of Credit shall be issued the Stated Amount of which, when added to the
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on
the date of, and prior to the issuance of, the respective Letter of Credit) at
such time would exceed either (x) $10,000,000 or (y) when added to the aggregate
principal amount of all Revolving Loans made by Non-Defaulting Banks then
outstanding and the aggregate principal amount of all Swingline Loans then
outstanding, an amount equal to the Adjusted Total Revolving Loan Commitment at
such time and (ii) each Letter of Credit shall by its terms terminate on or
before (x) in the case of Standby Letters of Credit, the earlier of (A) the date
which occurs one year after the date of the issuance thereof (although any such
Standby Letter of Credit may be extendable for successive periods of up to one
year, but not beyond the tenth Business Day prior to the Revolving Loan Maturity
Date, on terms acceptable to the Issuing Bank thereof) and (B) the tenth
Business Day prior to the Revolving Loan Maturity Date and (y) in the case of
Trade Letters of Credit, the earlier of (A) the date which occurs one year after
the date of issuance thereof and (B) 30 days prior to the Revolving Loan
Maturity Date.
2.03 Letter of Credit Requests. (a) Whenever the Borrower desires that
a Letter of Credit be issued for its account, the Borrower shall give the
Administrative Agent and the respective Issuing Bank at least five Business
Days' (or such shorter period as is acceptable to the respective Issuing Bank)
written notice thereof. Each notice shall be in the form of Exhibit C (each a
"Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.02. Unless the respective Issuing Bank has received notice from the Required
Banks before it issues a Letter of Credit that one or more of the conditions
specified in Section 5 are not satisfied on the Initial Borrow-
-16-
ing Date or Section 6 are not then satisfied, or that the issuance of such
Letter of Credit would violate Section 2.02, then, subject to the terms and
conditions of this Agreement, such Issuing Bank shall issue the requested Letter
of Credit for the account of the Borrower in accordance with such Issuing Bank's
usual and customary practices. Upon the issuance of or amendment or modification
to a Standby Letter of Credit, the respective Issuing Bank shall promptly notify
the Borrower and the Administrative Agent of such issuance, amendment or
modification and such notification shall be accompanied by a copy of the issued
Standby Letter of Credit or amendment or modification.
2.04 Letter of Credit Participations. (a) Immediately upon the
issuance by the respective Issuing Bank of any Letter of Credit, such Issuing
Bank shall be deemed to have sold and transferred to each Bank with a Revolving
Loan Commitment, other than such Issuing Bank (each such Bank, in its capacity
under this Section 2.04, a "Participant"), and each such Participant shall be
deemed irrevocably and unconditionally to have purchased and received from such
Issuing Bank, without recourse or warranty, an undivided interest and
participation, to the extent of such Participant's Adjusted RL Percentage, in
such Letter of Credit, each drawing or payment made thereunder and the
obligations of the Borrower under this Agreement with respect thereto, and any
security therefor or guaranty pertaining thereto. Upon any change in the
Revolving Loan Commitments or Adjusted RL Percentages of the Banks pursuant to
Section 1.13 or 13.04, it is hereby agreed that, with respect to all outstanding
Letters of Credit and Unpaid Drawings, there shall be an automatic adjustment to
the participations pursuant to this Section 2.04 to reflect the new Adjusted RL
Percentages of the assignor and assignee Bank, as the case may be.
(b) In determining whether to pay under any Letter of Credit, the
respective Issuing Bank shall have no obligation relative to the other Banks
other than to confirm that any documents required to be delivered under such
Letter of Credit appear to have been delivered and that they appear to
substantially comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit if taken or omitted in the absence of gross
negligence or willful misconduct, shall not create for such Issuing Bank any
resulting liability to the Borrower, any other Credit Party, any Bank or any
other Person.
(c) In the event that any Issuing Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to such Issuing Bank pursuant to Section 2.05(a), such Issuing Bank shall
promptly notify the Administrative Agent, which shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to such Issuing Bank the amount of such Participant's
Adjusted RL Percentage of such unreimbursed payment in Dollars and in same day
funds. If the Administrative Agent so notifies, prior to 11:00 A.M. (Eastern
time) on any Business Day, any Participant required to fund a payment under a
Letter of Credit, such Participant shall make available to such Issuing Bank in
Dollars such Participant's Adjusted RL Percentage of
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the amount of such payment on such Business Day in same day funds. If and to the
extent such Participant shall not have so made its Adjusted RL Percentage of the
amount of such payment available to such Issuing Bank, such Participant agrees
to pay to such Issuing Bank, forthwith on demand such amount, together with
interest thereon, for each day from such date until the date such amount is paid
to such Issuing Bank at the overnight Federal Funds Rate for the first three
days and at the interest rate applicable to Revolving Loans maintained as Base
Rate Loans for each day thereafter. The failure of any Participant to make
available to such Issuing Bank its Adjusted RL Percentage of any payment under
any Letter of Credit shall not relieve any other Participant of its obligation
hereunder to make available to such Issuing Bank its Adjusted RL Percentage of
any Letter of Credit on the date required, as specified above, but no
Participant shall be responsible for the failure of any other Participant to
make available to such Issuing Bank such other Participant's Adjusted RL
Percentage of any such payment.
(d) Whenever any Issuing Bank receives a payment of a reimbursement
obligation as to which it has received any payments from the Participants
pursuant to clause (c) above, such Issuing Bank shall pay to each Participant
which has paid its Adjusted RL Percentage thereof, in Dollars and in same day
funds, an amount equal to such Participant's share (based upon the proportionate
aggregate amount originally funded by such Participant to the aggregate amount
funded by all Participants) of the principal amount of such reimbursement
obligation and interest thereon accruing after the purchase of the respective
participations.
(e) Upon the request of any Participant, each Issuing Bank shall
furnish to such Participant copies of any Letter of Credit issued by it and such
other documentation as may reasonably be requested by such Participant.
(f) The obligations of the Participants to make payments to each
Issuing Bank with respect to Letters of Credit issued by it shall be irrevocable
and not subject to any qualification or exception whatsoever (except as
otherwise expressly provided in the last sentence of Section 2.04(b)) and shall
be made in accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or any of
the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other right which
the Borrower or any of its Subsidiaries may have at any time against a
beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Administrative Agent, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any
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underlying transaction between the Borrower or any Subsidiary of the
Borrower and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings . (a) The Borrower
hereby agrees to reimburse the respective Issuing Bank, by making payment to the
Administrative Agent in immediately available funds at the Payment Office, for
any payment or disbursement made by such Issuing Bank under any Letter of Credit
issued by it (each such amount, so paid until reimbursed, an "Unpaid Drawing"),
immediately after, and in any event on the date of, such payment or
disbursement, with interest on the amount so paid or disbursed by such Issuing
Bank, to the extent not reimbursed prior to 12:00 Noon (Eastern time) on the
date of such payment or disbursement, from and including the date paid or
disbursed to but excluding the date such Issuing Bank was reimbursed by the
Borrower therefor at a rate per annum which shall be the Base Rate in effect
from time to time plus the Applicable Base Rate Margin; provided, however, to
the extent such amounts are not reimbursed prior to 12:00 Noon (Eastern time) on
the third Business Day following the receipt by the Borrower of notice of such
payment or disbursement or following the occurrence of a Default or an Event of
Default under Section 10.05, interest shall thereafter accrue on the amounts so
paid or disbursed by such Issuing Bank (and until reimbursed by the Borrower) at
a rate per annum which shall be the Base Rate in effect from time to time plus
the Applicable Base Rate Margin plus 2%, in each such case, with interest to be
payable on demand. The respective Issuing Bank shall give the Borrower prompt
written notice of each Drawing under any Letter of Credit, provided that the
failure to give any such notice shall in no way affect, impair or diminish the
Borrower's obligations hereunder.
(b) The obligations of the Borrower under this Section 2.05 to
reimburse the respective Issuing Bank with respect to Unpaid Drawings
(including, in each case, interest thereon) shall be absolute and unconditional
under any and all circumstances and irrespective of any setoff, counterclaim or
defense to payment which the Borrower may have or have had against any Bank
(including in its capacity as issuer of the Letter of Credit or as Participant),
including, without limitation, any defense based upon the failure of any drawing
under a Letter of Credit (each a "Drawing") to conform to the terms of the
Letter of Credit or any nonapplication or misapplication by the beneficiary of
the proceeds of such Drawing; provided, however, that the Borrower shall not be
obligated to reimburse any Issuing Bank for any wrongful
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payment made by such Issuing Bank under a Letter of Credit as a result of acts
or omissions constituting willful misconduct or gross negligence on the part of
such Issuing Bank.
2.06 Increased Costs. If at any time after the date of this Agreement,
the introduction of or any change in any applicable law, rule, regulation,
order, guideline or request or in the interpretation or administration thereof
by any governmental authority charged with the interpretation or administration
thereof, or compliance by any Issuing Bank or any Participant with any request
or directive by any such authority (including the NAIC) (whether or not having
the force of law), shall either (i) impose, modify or make applicable any
reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by any Issuing Bank or participated in by any Participant, or (ii)
impose on any Issuing Bank or any Participant any other conditions relating,
directly or indirectly, to this Agreement; and the result of any of the
foregoing is to increase the cost to any Issuing Bank or any Participant of
issuing, maintaining or participating in any Letter of Credit, or reduce the
amount of any sum received or receivable by any Issuing Bank or any Participant
hereunder or reduce the rate of return on its capital with respect to Letters of
Credit (except for changes in the rate of tax on, or determined by reference to,
the net income or profits of such Issuing Bank or such Participant or any change
in a tax imposed solely on deposits or net assets of the Issuing Bank or such
Participant, in each case pursuant to the laws of the jurisdiction in which it
is organized or in which its principal office or applicable lending office is
located or any subdivision thereof or therein), then, within ten Business Days
of the delivery of the certificate referred to below to the Borrower by such
Issuing Bank or any Participant (a copy of which certificate shall be sent by
such Issuing Bank or such Participant to the Agent), the Borrower shall, subject
to the provisions of this Section 2.06 and Section 13.17 (to the extent
applicable), pay to such Issuing Bank or such Participant such additional amount
or amounts as will compensate such Bank for such increased cost or reduction in
the amount receivable or reduction on the rate of return on its capital. Any
Issuing Bank or any Participant, upon determining that any additional amounts
will be payable pursuant to this Section 2.06, will give prompt written notice
thereof to the Borrower, which notice shall include a certificate submitted to
the Borrower by such Issuing Bank or such Participant (a copy of which
certificate shall be sent by such Issuing Bank or such Participant to the
Agent), setting forth in reasonable detail the introduction of or change in
applicable law, rule, regulation, order, guideline or request or in the
interpretation or administration thereof and the basis for the calculation of
such additional amount or amounts necessary to compensate such Issuing Bank or
such Participant. In determining such additional amounts, each Issuing Bank and
each Participant will act reasonably and in good faith, provided that the
certificate required to be delivered pursuant to this Section 2.06 shall, absent
manifest error, be final and conclusive and binding on the Borrower.
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SECTION 3. Commitment Commission; Fees; Reductions of Commitment.
3.01 Fees; (a) The Borrower agrees to pay to the Administrative Agent
for distribution to each Non-Defaulting Bank with a Revolving Loan Commitment a
commitment commission (the "Revolving Loan Commitment Commission") for the
period from and including the Effective Date to but excluding the Revolving Loan
Maturity Date (or such earlier date as the Total Revolving Loan Commitment shall
have been terminated), computed at a rate for each day equal to the Applicable
Commitment Commission Percentage on the daily average Unutilized Revolving Loan
Commitment of such Non-Defaulting Bank. Accrued Revolving Loan Commitment
Commission shall be due and payable quarterly in arrears on each Quarterly
Payment Date and on the Revolving Loan Maturity Date or such earlier date upon
which the Total Revolving Loan Commitment is terminated.
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each Non-Defaulting Bank with a Revolving Loan Commitment (based
on each such Non-Defaulting Bank's respective Adjusted RL Percentage) a fee in
respect of each Letter of Credit issued hereunder (the "Letter of Credit Fee"),
for the period from and including the date of issuance of such Letter of Credit
to and including the date of termination or expiration of such Letter of Credit,
computed at a rate per annum equal to the Applicable Eurodollar Margin on the
daily Stated Amount of such Letter of Credit. Accrued Letter of Credit Fees
shall be due and payable quarterly in arrears on each Quarterly Payment Date and
on the first day after the termination of the Total Revolving Loan Commitment
upon which no Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to each Issuing Bank, for its own
account, a facing fee in respect of each Letter of Credit issued by such Issuing
Bank (the "Facing Fee"), for the period from and including the date of issuance
of such Letter of Credit to and including the date of the termination of such
Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily
Stated Amount of such Letter of Credit. Accrued Facing Fees shall be due and
payable quarterly in arrears on each Quarterly Payment Date and upon the first
day after the termination of the Total Revolving Loan Commitment upon which no
Letters of Credit remain outstanding.
(d) The Borrower agrees to pay, upon each drawing under, issuance of,
or amendment to, any Letter of Credit, such amount as shall at the time of such
event be the administrative charge which the applicable Issuing Bank is
generally imposing in connection with such occurrence with respect to letters of
credit.
(e) The Borrower agrees to pay to the Agents, for their own account,
such other fees as have been agreed to in writing by the Borrower and the
Agents.
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3.02 Voluntary Termination of Unutilized Commitments. (a) Upon at
least one Business Day's prior written notice to the Administrative Agent at its
Notice Office (which notice the Administrative Agent shall promptly transmit to
each of the Banks), the Borrower shall have the right, at any time or from time
to time, without premium or penalty, to terminate the Total Unutilized Revolving
Loan Commitment, in whole or in part, in integral multiples of $1,000,000 in the
case of partial reductions to the Total Unutilized Revolving Loan Commitment,
provided that (i) each such reduction shall apply proportionately to permanently
reduce the Revolving Loan Commitment of each Bank with such a Commitment and
(ii) the reduction to the Total Unutilized Revolving Loan Commitment shall in no
case be in an amount which would cause the Revolving Loan Commitment of any Bank
to be reduced (as required by preceding clause (i)) by an amount which exceeds
the remainder of (x) the Unutilized Revolving Loan Commitment of such Bank as in
effect immediately before giving effect to such reduction minus (y) such Bank's
Adjusted RL Percentage of the aggregate principal amount of Swingline Loans then
outstanding.
(b) In the event of a refusal by a Bank to consent to one or more
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as (and to the extent)
provided in Section 13.12(b), the Borrower may, subject to its compliance with
the requirements of Section 13.12(b), upon 5 Business Days' prior written notice
to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks) terminate all
of the Revolving Loan Commitment of such Bank and, so long as all Loans,
together with accrued and unpaid interest, Fees and all other amounts, owing to
such Bank (other than amounts owing in respect of any Tranche of Loans
maintained by such Bank which are not being repaid pursuant to Section 13.12(b))
are repaid concurrently with the effectiveness of such termination pursuant to
Section 4.01(b) (at which time Schedule I shall be deemed modified to reflect
such changed amounts), and at such time, unless the respective Bank continues to
have outstanding Loans of one or more Tranches hereunder, such Bank shall no
longer constitute a "Bank" for purposes of this Agreement, except with respect
to indemnifications under this Agreement (including, without limitation,
Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01), which shall survive as to
such repaid Bank.
3.03 Mandatory Reduction of Commitments. (a) The Total Commitments
(and the Term Loan Commitment and the Revolving Loan Commitment of each Bank)
shall terminate in their entirety on December 31, 1997 unless the Initial
Borrowing Date has occurred on or before such date.
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Term Loan Commitment (and the Term Loan
Commitment of each Bank) shall (i) terminate in its entirety on the Initial
Borrowing Date (immediately after giving effect to the making of the Term Loans
on such date) and (ii) prior to the termination of the
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Total Term Loan Commitment, be reduced from time to time to the extent required
by Section 4.02.
(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving
Loan Commitment of each Bank) shall terminate in its entirety on the Revolving
Loan Maturity Date.
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, on each date after the Effective Date upon which a
mandatory repayment of Term Loans or a mandatory reduction to the Total Term
Loan Commitment pursuant to any of Sections 4.02(c) through (f), inclusive, is
required (and exceeds in amount the sum of (i) the aggregate principal amount of
Term Loans then outstanding and (ii) the Total Term Loan Commitment as then in
effect or would be required if Term Loans were then outstanding or the Total
Term Loan Commitment was then in effect, the Total Revolving Loan Commitment
shall be permanently reduced by the amount, if any, by which the amount required
to be applied pursuant to said Sections (determined as if an unlimited amount of
Term Loans were actually outstanding) exceeds the sum of (x) the aggregate
principal amount of Term Loans then outstanding and (y) the Total Term Loan
Commitment as then in effect.
(e) Each reduction to the Total Term Loan Commitment and the Total
Revolving Loan Commitment pursuant to this Section 3.03 (or pursuant to Section
4.02) shall be applied proportionately to permanently reduce the Term Loan
Commitment or the Revolving Loan Commitment, as the case may be, of each Bank
with such a Commitment.
SECTION 4. Prepayments; Payments; Taxes.
4.01 Voluntary Prepayments. (a) The Borrower shall have the right to
prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions:
(i) the Borrower shall give the Administrative Agent prior to 12:00
Noon (Eastern time) at its Notice Office (x) at least one Business Day's
prior written notice (or telephonic notice promptly confirmed in writing)
of its intent to prepay Base Rate Loans and (y) at least three Business
Days' prior written notice (or telephonic notice promptly confirmed in
writing) of its intent to prepay Eurodollar Loans, whether Term Loans,
Revolving Loans or Swingline Loans shall be prepaid, the amount of such
prepayment and the Types of Loans to be prepaid and, in the case of
Eurodollar Loans, the specific Borrowing or Borrowings pursuant to which
made, which notice the Administrative Agent shall promptly transmit to each
of the Banks;
(ii) each prepayment shall be in an aggregate principal amount of at
least (x) $1,000,000 in the case of Term Loans or Revolving Loans or (y)
$100,000 in the
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case of Swingline Loans, and, in each case, if greater, in integral
multiples of $100,000, provided that if any partial prepayment of
Eurodollar Loans made pursuant to any Borrowing shall reduce the
outstanding principal amount of Eurodollar Loans made pursuant to such
Borrowing to an amount less than the Minimum Borrowing Amount applicable
thereto, then such Borrowing may not be continued as a Borrowing of
Eurodollar Loans and any election of an Interest Period with respect
thereto given by the Borrower shall have no force or effect;
(iii) prepayments of Eurodollar Loans made pursuant to this Section
4.01(a) may only be made on the last day of an Interest Period applicable
thereto unless such prepayment is accompanied by any breakage costs and any
other amounts due such Bank in accordance with Section 1.11;
(iv) each prepayment in respect of any Loans made pursuant to a
Borrowing shall be applied pro rata among such Loans, provided that, at the
Borrower's election, in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01(a), such prepayment shall not be applied to
any Revolving Loans of a Defaulting Bank; and
(v) each voluntary prepayment of Term Loans pursuant to this Section
4.01(a) shall be applied to reduce the then remaining Scheduled Repayments
pro rata based upon the then remaining amount of each Scheduled Repayment
after giving effect to all prior reductions thereto.
(b) In the event of a refusal by a Bank to consent to one or more
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks as (and to the extent)
provided in Section 13.12(b), the Borrower may, upon 5 Business Days' prior
written notice to the Administrative Agent at its Notice Office (which notice
the Administrative Agent shall promptly transmit to each of the Banks) repay all
Loans, together with accrued and unpaid interest, Fees, and other amounts owing
to such Bank (or owing to such Bank with respect to each Tranche which gave rise
to the need to obtain such Bank's individual consent) in accordance with, and
subject to the requirements of, said Section 13.12(b) so long as (i) in the case
of the repayment of Revolving Loans of any Bank pursuant to this clause (b) the
Revolving Loan Commitment of such Bank is terminated concurrently with such
repayment pursuant to Section 3.02(b) (at which time Schedule I shall be deemed
modified to reflect the changed Revolving Loan Commitments), and (ii) the
consents, if any, required by Section 13.12(b) in connection with the repayment
pursuant to this clause (b) have been obtained.
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4.02 Mandatory Repayments and Commitment Reductions. (a)(i) On any day on
which the sum of the aggregate outstanding principal amount of the Revolving
Loans made by Non-Defaulting Banks, Swingline Loans and the Letter of Credit
Outstandings exceeds the Adjusted Total Revolving Loan Commitment as then in
effect, the Borrower shall prepay on such day principal of Swingline Loans in an
amount up to the amount of such excess and, after all Swingline Loans have been
repaid in full, Revolving Loans of Non-Defaulting Banks in an amount equal to
such excess minus the principal amount of Swingline Loans so prepaid. If, after
giving effect to the prepayment of all outstanding Swingline Loans and Revolving
Loans of Non-Defaulting Banks, the aggregate amount of the Letter of Credit
Outstandings exceeds the Adjusted Total Revolving Loan Commitment as then in
effect, the Borrower shall pay to the Administrative Agent at the Payment Office
on such day an amount of cash or Cash Equivalents equal to the amount of such
excess (up to a maximum amount equal to the Letter of Credit Outstandings at
such time), such cash or Cash Equivalents to be held as security for all
obligations of the Borrower to the Issuing Banks and the Non-Defaulting Banks
hereunder in a cash collateral account to be established by the Administrative
Agent.
(ii) On any day on which the aggregate outstanding principal amount of
the Revolving Loans made by any Defaulting Bank exceeds the Revolving Loan
Commitment of such Defaulting Bank, the Borrower shall prepay on such day
principal of Revolving Loans of such Defaulting Bank in an amount equal to such
excess.
(b) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date set forth below, the
Borrower shall be required to repay that principal amount of Term Loans, to the
extent then outstanding, as is set forth opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01(a) and
4.02(h), a "Scheduled Repayment," and each such date, a "Scheduled Repayment
Date"):
Scheduled Repayment Date Amount
February 28, 1998 $2,500,000
May 31, 1998 $2,500,000
August 31, 1998 $2,500,000
November 30, 1998 $2,500,000
February 28, 1999 $3,750,000
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May 31, 1999 $3,750,000
August 31, 1999 $3,750,000
November 30, 1999 $3,750,000
February 28, 2000 $3,750,000
May 31, 2000 $3,750,000
August 31, 2000 $3,750,000
November 30, 2000 $3,750,000
February 28, 2001 $5,000,000
May 31, 2001 $5,000,000
August 31, 2001 $5,000,000
November 30, 2001 $5,000,000
February 28, 2002 $5,000,000
May 31, 2002 $5,000,000
August 31, 2002 $5,000,000
November 30, 2002 $5,000,000
February 28, 2003 $5,000,000
May 31, 2003 $5,000,000
August 31, 2003 $5,000,000
November 30, 2003 $5,000,000
February 28, 2004 $6,250,000
May 31, 2004 $6,250,000
August 31, 2004 $6,250,000
Term Loan Maturity Date $6,250,000
(c) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date on or after the Effective
Date upon which the Borrower or any of its Wholly-Owned Subsidiaries receives
any cash proceeds from any incurrence by the Borrower or any of its Wholly-Owned
Subsidiaries of Indebtedness for borrowed money (other than Indebtedness for
borrowed money permitted to be incurred pursuant to Section 9.04 (except for the
incurrence of New Subordinated Notes pursuant to Section 9.04(vi), the proceeds
of which are required to be applied as set forth in such Section) as such
Section is in effect on the Effective Date), an amount equal to 100% of the Net
Debt Proceeds of the respective incurrence of Indebtedness shall be applied as a
mandatory repayment of principal of outstanding Term Loans (and/or, if the Total
Term Loan Commitment has not yet been terminated, as a mandatory reduction to
the Total Term Loan Commitment) in accordance with the requirements of Sections
4.02(g) and (h).
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(d) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, on each date on or after the Effective
Date upon which the Borrower or any of its Wholly-Owned Subsidiaries receives
cash proceeds from any Asset Sale, an amount equal to 100% of the Net Sale
Proceeds from the respective Asset Sale shall be applied as a mandatory
repayment of principal of outstanding Term Loans (and/or, if the Total Term Loan
Commitment has not yet been terminated, as a mandatory reduction to the Total
Term Loan Commitment) in accordance with the requirements of Sections 4.02(g)
and (h), provided that, so long as no Default or Event of Default then exists,
up to $2,000,000 in the aggregate in any fiscal year of the Borrower of Net Sale
Proceeds from Asset Sales may be used or contractually committed to be used to
purchase like assets pursuant to Section 9.07(b) within 180 days following the
date of the respective Asset Sale (and the Net Sale Proceeds therefrom shall not
be required to be applied on the date of receipt of such Net Sale Proceeds
pursuant to this Section 4.02(d)) so long as the Borrower delivers a certificate
to the Administrative Agent on or prior to such date stating that such Net Sale
Proceeds shall be used or contractually committed to be used to purchase like
assets within 180 days following the date of such Asset Sale (which certificate
shall set forth the estimates of the proceeds to be so expended) and provided
further, that (1) if all or any portion of such Net Sale Proceeds are not so
reinvested in like assets within such 180 day period or contractually committed
to be so reinvested within such 180-day period, 100% of such remaining portion
shall be applied on the last day of such applicable period as a mandatory
repayment of principal of outstanding Term Loans as provided above in this
Section 4.02(d) without regard to the immediately preceding proviso and (2) if
all or any portion of such Net Sale Proceeds are not required to be applied on
the 180th day referred to in clause (1) above because such amount is
contractually committed to be used and subsequent to such date such contract is
terminated or expires without such portion being so used, then such remaining
portion shall be applied within ten days of the date of such termination or
expiration as a mandatory repayment of principal of outstanding Term Loans as
provided in this Section 4.02(d) without regard to the immediately preceding
proviso.
(e) In addition to any other mandatory repayments pursuant to this
Section 4.02, on each Excess Cash Payment Date, an amount equal to 50% of the
Excess Cash Flow for the relevant Excess Cash Payment Period shall be applied as
a mandatory repayment of principal of outstanding Term Loans in accordance with
the requirements of Sections 4.02(g) and (h).
(f) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02, within five days following each date
on or after the Effective Date upon which the Borrower or any of its
Wholly-Owned Subsidiaries receives any cash proceeds from any Recovery Event in
excess of $250,000 in the aggregate in any fiscal year of the Borrower from all
Recovery Events, an amount equal to 100% of the Net Insurance Proceeds of such
Recovery Event shall be applied as a mandatory repayment of principal of
outstanding Term Loans (and/or, if the Total Term Loan Commitment has not yet
been terminated, as a mandatory reduction to the Total Term Loan Commitment) in
accordance with the requirements of Sections 4.02(g) and (h), provided that, so
long as no Default or Event of
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Default then exists, such proceeds shall not be required to be so applied on
such date to the extent that the Borrower has delivered a certificate to the
Administrative Agent on or prior to such date stating that such proceeds shall
be used or shall be contractually committed to be used to replace or restore any
properties or assets in respect of which such proceeds were paid within 180 days
following the date of the receipt of such proceeds (which certificate shall set
forth the estimates of the proceeds to be so expended), and provided further,
that (1) if all or any portion of such proceeds not required to be applied to
the repayment of outstanding Term Loans (and/or as a reduction to the Total Term
Loan Commitment) are not so used or contractually committed to be used within
180 days after the date of the receipt of such proceeds, then such remaining
portion not used or contractually committed to be used shall be applied on the
date which is the 180th day after the date of the receipt of such proceeds as a
mandatory repayment of principal of outstanding Term Loans as provided above in
this Section 4.02(f) without regard to the immediately preceding proviso and (2)
if all or any portion of such proceeds are not required to be applied on the
180th day referred to in clause (1) above because such amount is contractually
committed to be used and subsequent to such date such contract is terminated or
expires without such portion being so used, then such remaining portion shall be
applied within ten days of the date of such termination or expiration as a
mandatory repayment of principal of outstanding Term Loans as provided in this
Section 4.02(f) without regard to the immediately preceding proviso.
(g) With respect to each repayment of Loans required by this Section
4.02, the Borrower may designate the Types of Loans of the respective Tranche
which are to be repaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings of the respective Tranche pursuant to which made,
provided that: (i) repayments of Eurodollar Loans pursuant to this Section 4.02
may only be made on the last day of an Interest Period applicable thereto unless
all Eurodollar Loans of the respective Tranche with Interest Periods ending on
such date of required repayment and all Base Rate Loans of the respective
Tranche have been paid in full; (ii) if any repayment of Eurodollar Loans made
pursuant to a single Borrowing shall reduce the outstanding Eurodollar Loans
made pursuant to such Borrowing to an amount less than the Minimum Borrowing
Amount applicable thereto, such Borrowing shall be converted at the end of the
then current Interest Period into a Borrowing of Base Rate Loans; and (iii) each
repayment of any Loans made pursuant to a Borrowing shall be applied pro rata
among such Loans. In the absence of a designation by the Borrower as described
in the preceding sentence, the Administrative Agent shall, subject to the above,
make such designation in its sole discretion. Notwithstanding the foregoing
provisions of this Section 4.02(g), if at any time a mandatory repayment of
Loans pursuant to this Section 4.02(g) would result, after giving effect to the
procedures set forth above in this Section 4.02(g), in the Borrower incurring
breakage costs under Section 1.11 as a result of Eurodollar Loans being prepaid
other than on the last day of an Interest Period applicable thereto (the
"Affected Eurodollar Loans"), then the Borrower may in its sole discretion, and
upon notice to the Administrative Agent, initially deposit a portion (up to
100%) of the amount that otherwise would have been paid in respect of the
Affected Eurodollar Loans with the Administrative Agent (which deposit must be
equal in amount to the amount of the Affected Eurodollar Loans not immediately
repaid) to be held as security for the Obligations of the Borrower pursuant to a
cash collateral
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arrangement satisfactory to the Administrative Agent and the Borrower which
shall permit investments in Cash Equivalents reasonably satisfactory to the
Administrative Agent, with such cash collateral to be directly applied upon the
earlier of (x) the first occurrence (or occurrences) thereafter of the last day
of an Interest Period applicable to the relevant Affected Eurodollar Loans of
the respective Tranche or Tranches that were initially required to be repaid (or
such earlier date or dates as shall be requested by the Borrower) and (y) the
date which is 180 days after such initial deposit, to repay an aggregate
principal amount of such Loans equal to the Affected Eurodollar Loans not
initially repaid pursuant to this sentence. Notwithstanding anything to the
contrary contained in the immediately preceding sentence, all amounts deposited
as cash collateral pursuant to the immediately preceding sentence shall be held
first for the sole benefit of the Banks whose Loans would otherwise have been
immediately repaid with the amounts deposited and upon the taking of any action
by the Administrative Agent or the Banks pursuant to the remedial provisions of
Section 10, any amounts held as cash collateral pursuant to this Section 4.02(g)
shall first be immediately applied to such Loans and thereafter to the other
Obligations of the Borrower.
(h) Each amount required to be applied to repay Term Loans pursuant
to Sections 4.02(c) through (f), inclusive, shall be applied (i) first, to repay
the outstanding principal amount of the Term Loans with all such repayments to
be deemed to apply first to repay Term Loans evidenced by the A Term Notes
before any obligations of the Borrower evidenced by the B Term Notes are so
reduced and (ii) second, to the extent in excess thereof, to reduce the Total
Term Loan Commitment, with such reduction to be applied first to reduce the Term
Loan Commitment evidenced by the A Term Notes before any such amount is applied
to reduce the Term Loan Commitment evidenced by the B Term Notes. The amount of
each principal repayment of Term Loans (and the amount of each reduction to the
Term Loan Commitments) made as required by said Sections 4.02(c) through (f),
inclusive, shall be applied to reduce the then remaining Scheduled Repayments
pro rata based upon the then remaining amount of each Scheduled Repayment after
giving effect to all prior reductions thereto.
(i) Notwithstanding anything to the contrary contained in this
Agreement or in any other Credit Document, all then outstanding Loans of any
Tranche shall be repaid in full on the respective Maturity Date for such Tranche
of Loans.
4.03 Method and Place of Payment. Except as otherwise specifically
provided herein, all payments under this Agreement or under any Note shall be
made to the Administrative Agent for the account of the Bank or Banks entitled
thereto not later than 12:30 p.m. (Eastern time) on the date when due and shall
be made in Dollars in immediately available funds at the Payment Office of the
Administrative Agent. Whenever any payment to be made hereunder or under any
Note shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest shall be payable during such
extension at the applicable rate immediately prior to such extension.
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4.04 Net Payments. (a) All payments made by the Borrower hereunder or
under any Note will be made without setoff, counterclaim or other defense.
Except as provided in Section 4.04(b), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any political subdivision or
taxing authority thereof or therein with respect to such payments (but
excluding, except as provided in the second succeeding sentence, any tax imposed
on or measured by the net income or net profits of a Bank and any taxes imposed
solely on deposits or net assets of a Bank, in each case pursuant to the laws of
the jurisdiction in which it is organized or the jurisdiction in which the
principal office or applicable lending office of such Bank is located or any
subdivision thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies, imposts, duties,
fees, assessments or other charges (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Non-Excluded Taxes"). Except as otherwise provided in Section
4.04(b), if any Non-Excluded Taxes are so levied or imposed, the Borrower agrees
to pay the full amount of such Non-Excluded Taxes, and such additional amounts
as may be necessary so that every payment of all amounts due under this
Agreement or under any Note, after withholding or deduction for or on account of
any Non-Excluded Taxes, will not be less than the amount provided for herein or
in such Note. If any amounts are payable in respect of Non-Excluded Taxes
pursuant to the preceding sentence, the Borrower agrees to reimburse each Bank,
upon the written request of such Bank, for taxes imposed on or measured by the
net income or net profits of such Bank pursuant to the laws of the jurisdiction
in which such Bank is organized or in which the principal office or applicable
lending office of such Bank is located or under the laws of any political
subdivision or taxing authority of any such jurisdiction in which such Bank is
organized or in which the principal office or applicable lending office of such
Bank is located and for any withholding of taxes as such Bank shall determine
are payable by, or withheld from, such Bank, in respect of such amounts so paid
to or on behalf of such Bank pursuant to the preceding sentence and in respect
of any amounts paid to or on behalf of such Bank pursuant to this sentence. The
Borrower will furnish to the Administrative Agent within 45 days after the date
the payment of any Non-Excluded Taxes is due pursuant to applicable law
certified copies of tax receipts evidencing such payment by the Borrower. The
Borrower agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Non-Excluded Taxes so
levied or imposed and paid by such Bank.
(b) Each Bank that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes
agrees to deliver to the Borrower and the Administrative Agent on or prior to
the Effective Date, or in the case of a Bank that is an assignee or transferee
of an interest under this Agreement pursuant to Section 1.13 or 13.04 (unless
the respective Bank was already a Bank hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to such
Bank, (i) two accurate and complete original signed copies of Internal Revenue
Service Form 4224 or 1001 (or successor forms) certifying to such Bank's
entitlement to a complete exemption from United States withholding tax with
respect to payments to be made under this Agreement and
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under any Note, or (ii) if the Bank is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "Section
4.04(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form) certifying to
such Bank's entitlement to a complete exemption from United States withholding
tax with respect to payments of interest to be made under this Agreement and
under any Note. In addition, each Bank agrees that from time to time after the
Effective Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material respect, it will,
promptly upon request by the Borrower, deliver to the Borrower and the
Administrative Agent two new accurate and complete original signed copies of
Internal Revenue Service Form 4224 or 1001, or Form W-8 and a Section
4.04(b)(ii) Certificate, as the case may be, and such other forms as may be
required in order to confirm or establish the entitlement of such Bank to a
continued exemption from or reduction in United States withholding tax with
respect to payments under this Agreement and any Note, or it shall immediately
notify the Borrower and the Administrative Agent of its inability to deliver any
such Form or Certificate because a change in law or change in circumstance
eliminates the availability to the Bank of an exemption from United States
withholding tax with respect to payments to be made under this Agreement or any
Note, in which case such Bank shall not be required to deliver any such Form or
Certificate pursuant to this Section 4.04(b). Notwithstanding anything to the
contrary contained in Section 4.04(a), but subject to Section 13.04(b), (x) the
Borrower shall be entitled, to the extent it is required to do so by law, to
deduct or withhold income or similar taxes imposed by the United States (or any
political subdivision or taxing authority thereof or therein) from interest,
Fees or other amounts payable hereunder for the account of any Bank which is not
a United States person (as such term is defined in Section 7701(a)(30) of the
Code) for U.S. Federal income tax purposes to the extent that such Bank has not
provided to the Borrower U.S. Internal Revenue Service Forms that establish a
complete exemption from such deduction or withholding and (y) the Borrower shall
not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be
made to a Bank in respect of income or similar taxes imposed by the United
States if (I) such Bank has not provided to the Borrower the Internal Revenue
Service Forms required to be provided to the Borrower pursuant to this Section
4.04(b) or (II) in the case of a payment, other than interest, to a Bank
described in clause (ii) above, to the extent that such Forms do not establish a
complete exemption from withholding of such taxes.
SECTION 5. Conditions Precedent to Initial Credit Events. The
obligation of each Bank to make Loans, and the obligation of any Issuing Bank to
issue Letters of Credit, on the Initial Borrowing Date, is subject at the time
of the making of such Loans or the issuance of such Letters of Credit to the
satisfaction of the following conditions:
5.01 Execution of Agreement; Notes. On or prior to the Initial
Borrowing Date, (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the Agents for the account of each of the Banks the
appropriate Term Note and/or Revolving Note exe-
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cuted by the Borrower and to the Swingline Bank, the Swingline Note executed by
the Borrower, in each case in the amount, maturity and otherwise as provided
herein.
5.02 Officer's Certificate. On the Initial Borrowing Date, the Agents
shall have received a certificate, dated the Initial Borrowing Date and signed
on behalf of the Borrower by the President or any Vice President of the
Borrower, stating that all of the conditions in Sections 5.05, 5.06, 5.07, 5.08,
5.09 and 6.01 have been satisfied on such date.
5.03 Opinions of Counsel. On the Initial Borrowing Date, the Agents
shall have received from (i) Xxxxxxxxx, Xxxxxxx, Xxxxx & Xxxxxxxx LLP, counsel
to the Credit Parties, an opinion addressed to the Agents and each of the Banks
and dated the Initial Borrowing Date, covering the matters set forth in Exhibit
E and such other matters incident to the transactions contemplated herein as any
Agent may reasonably request and (ii) local counsel (reasonably satisfactory to
the Agents), opinions each of which (x) shall be addressed to the Agents and
each of the Banks and dated the Initial Borrowing Date, (y) shall be in form and
substance reasonably satisfactory to the Agents and (z) shall cover the
perfection of the security interests granted pursuant to the Security Documents
and such other matters incident to the transactions contemplated herein as any
Agent may reasonably request.
5.04 Corporate Documents; Proceedings; etc. (a) On the Initial
Borrowing Date, the Agents shall have received a certificate from each Credit
Party, dated the Initial Borrowing Date, signed by the President or any Vice
President of such Credit Party, and attested to by the Secretary or any
Assistant Secretary of such Credit Party, in the form of Exhibit F with
appropriate insertions, together with copies of the certificate of incorporation
(or equivalent organizational document) and by-laws of such Credit Party and the
resolutions of such Credit Party referred to in such certificate, and each such
certificate of incorporation and by-laws shall be in the form provided to the
Agents prior to the Effective Date or in such other form as is reasonably
acceptable to the Agents, and the foregoing resolutions shall be in form and
substance reasonably acceptable to the Agents.
(b) All corporate and legal proceedings and all instruments and
agreements in connection with the transactions contemplated by this Agreement
and the other Documents shall be reasonably satisfactory in form and substance
to the Agents, and the Agents shall have received all information and copies of
all documents and papers, including records of corporate proceedings,
governmental approvals, good standing certificates and bring-down telegrams or
facsimiles, if any, which any Agent may have requested in connection therewith,
such documents and papers where appropriate to be certified by proper corporate
or governmental authorities.
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5.05 Employee Benefit Plans; Shareholders' Agreements; Management
Agreements; Employee Benefit Plans; Shareholders' Agreements; Management
Agreements; Collective Bargaining Agreements; Existing Indebtedness Agreements.
On or prior to the Initial Borrowing Date, there shall have been made
available for review by the Agents true and correct copies of the following
documents:
(i) all Plans (and for each Plan that is required to file an annual
report on Internal Revenue Service Form 5500-series, a copy of the most
recent such report (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting
statements, certifications, schedules and information), and for each Plan
that is a "single-employer plan," as defined in Section 4001(a)(15) of
ERISA, the most recently prepared actuarial valuation therefor) and any
other "employee benefit plans", as defined in Section 3(3) of ERISA, and
any other material agreements, plans or arrangements, with or for the
benefit of current or former employees of the Borrower or any of its
Subsidiaries or any ERISA Affiliate (collectively, the "Employee Benefit
Plans");
(ii) all material agreements entered into by the Borrower or any of
its Subsidiaries governing the terms and relative rights of its capital
stock and any agreements entered into by shareholders relating to any such
entity with respect to its capital stock (collectively, the "Shareholders'
Agreements");
(iii) all material agreements with members of, or with respect to, the
senior management and management of the Borrower or any of its Subsidiaries
(collectively, the "Management Agreements");
(iv) all collective bargaining agreements applying or relating to any
employee of the Borrower or any of its Subsidiaries (collectively, the
"Collective Bargaining Agreements");
(v) all agreements evidencing or relating to Indebtedness of the
Borrower or any of its Subsidiaries which is to remain outstanding after
giving effect to the incurrence of Loans on the Initial Borrowing Date to
the extent such Indebtedness exceeds (or upon the utilization of any unused
commitments may exceed) $250,000 (collectively, the "Existing Indebtedness
Agreements"); and
(vi) all tax sharing, tax allocation and other similar agreements
entered into by the Borrower or any of its Subsidiaries (collectively, the
"Tax Sharing Agreements").
all of which Employee Benefit Plans, Shareholders' Agreements, Management
Agreements, Collective Bargaining Agreements, Existing Indebtedness Agreements
and Tax Sharing Agreements shall be in full force and effect on the Initial
Borrowing Date.
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5.06 Consummation of Acquisition. On the Initial Borrowing Date, (i)
the Acquisition shall have been consummated in accordance with the Acquisition
Documents and all applicable laws and (ii) each of the conditions precedent set
forth in the Asset Purchase Agreement shall have been satisfied in all material
respects, and not waived by SKL except with the reasonable consent of the
Agents, to the reasonable satisfaction of the Agents, and (iii) the Agents shall
have received true and complete copies of all Acquisition Documents, with such
Acquisition Documents to be in the form delivered to the Agents on or before
July 23, 1997 and on November 11, 1997 with such changes thereto or waivers
therefrom by SKL to be reasonably satisfactory to the Agents.
5.07 Refinancing. On the Initial Borrowing Date and after giving
effect to the Acquisition and the Loans incurred on the Initial Borrowing Date,
neither the Borrower nor any of its Subsidiaries shall have any Indebtedness
outstanding except for (x) the Obligations and (y) the Existing Indebtedness.
Schedule IV sets forth a true and complete list of all Indebtedness to be
Refinanced, in each case showing the aggregate principal amount thereof and
accrued interest thereon (immediately before giving effect to the Initial
Borrowing Date) and the name of the respective borrower thereof. On the Initial
Borrowing Date, all Indebtedness to be Refinanced shall have been repaid in full
and all commitments in respect thereof shall have been terminated and all Liens
and guaranties in connection therewith shall have been terminated (and all
appropriate releases, termination statements or other instruments of assignment
with respect thereto shall have been obtained) to the reasonable satisfaction of
the Agents. The Agents shall have received evidence, in form and substance
reasonably satisfactory to them, that the matters set forth in the immediately
preceding sentence have been satisfied as of the Initial Borrowing Date.
5.08 Adverse Change, etc. (a) On or prior to the Initial Borrowing
Date, nothing shall have occurred (and the Agents shall have become aware of no
facts or conditions not previously known) which is reasonably likely to have a
material adverse effect on the rights or remedies of the Banks or the Agents, or
on the ability of the Borrower or its Subsidiaries to perform their obligations
to the Banks or which is reasonably likely to have a materially adverse effect
on the business, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole,
in each case after giving effect to the consummation of the Transaction.
(b) All necessary governmental approvals and/or consents, all
necessary shareholder and board of director approvals and/or consents, in each
case in connection with the Transaction and the other transactions contemplated
by the Documents and otherwise referred to herein or therein shall have been
obtained and remain in effect, and all applicable waiting periods with respect
thereto shall have expired without any action being taken by any competent
authority which restrains, prevents or imposes materially adverse conditions
upon, the consummation of the Transaction or the other transactions contemplated
by the Credit Documents or otherwise referred to herein or therein.
Additionally, there shall not exist any judgment, order, injunction or other
restraint issued or filed or a hearing seeking injunctive
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relief or other restraint pending or notified prohibiting or imposing materially
adverse conditions upon the Transaction or the other transactions contemplated
by the Credit Documents.
5.09 Litigation. On the Initial Borrowing Date, no litigation by any
entity (private or governmental) shall be pending or threatened (i) with respect
to the Transaction or any Document or (ii) which is reasonably likely to have a
material adverse effect on the rights or remedies of the Banks or the Agents, or
on the ability of the Borrower or its Subsidiaries to perform their obligations
to the Banks or which is reasonably likely to have a materially adverse effect
on the business, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole,
in each case after giving effect to the consummation of the Transaction.
5.10 Pledge Agreement. On the Initial Borrowing Date, each Credit
Party shall have duly authorized, executed and delivered the Pledge Agreement in
the form of Exhibit G (as amended, modified or supplemented from time to time,
the "Pledge Agreement") and shall have delivered to the Collateral Agent, as
Pledgee thereunder, all of the Pledged Securities, if any, referred to therein
then owned by such Credit Party, (x) endorsed in blank in the case of promissory
notes constituting Pledged Securities and (y) together with executed and undated
stock powers in the case of capital stock constituting Pledged Securities.
5.11 Security Agreement. On the Initial Borrowing Date, each Credit
Party shall have duly authorized, executed and delivered the Security Agreement
in the form of Exhibit H (as modified, supplemented or amended from time to
time, the "Security Agreement") covering all of such Credit Party's present and
future Security Agreement Collateral, together with:
(i) proper Financing Statements (Form UCC-1 or the equivalent) fully
executed for filing under the UCC or other appropriate filing offices of
each jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by the Security Agreement;
(ii) copies of Requests for Information or Copies (Form UCC-11), or
equivalent reports, listing all effective financing statements that name
any Credit Party as debtor and that are filed in the jurisdictions referred
to in clause (i) above, together with copies of such other financing
statements that name any Credit Party as debtor (none of which shall cover
the Collateral except to the extent evidencing Permitted Liens or in
respect of which the Collateral Agent shall have received termination
statements (Form UCC-3) or such other termination statements as shall be
required by local law fully executed for filing); and
(iii) evidence that all other actions necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect and protect the
security interests purported
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to be created by the Security Agreement have been (or within 10 days
following the Initial Borrowing Date will be) taken.
5.12 Subsidiaries Guaranty. On the Initial Borrowing Date, each
Subsidiary Guarantor shall have duly authorized, executed and delivered the
Subsidiaries Guaranty in the form of Exhibit I (as amended, modified or
supplemented from time to time, the "Subsidiaries Guaranty").
5.13 Mortgages; Title Insurance; Survey; etc. On the Initial
Borrowing Date, the Collateral Agent shall have received:
(i) fully executed counterparts of Mortgages, in form and substance
reasonably satisfactory to the Agents, which Mortgages shall cover the
Mortgaged Properties owned by the Credit Parties on the Initial Borrowing
Date as designated on Schedule III, together with evidence that
counterparts of such Mortgages have been delivered to the title insurance
company insuring the Lien of such Mortgages for recording in all places to
the extent necessary or, in the reasonable opinion of the Collateral Agent,
desirable, to effectively create a valid and enforceable first priority
mortgage lien on each such Mortgaged Property in favor of the Collateral
Agent (or such other trustee as may be required or desired under local law)
for the benefit of the Secured Creditors;
(ii) a mortgagee title insurance policy on each such Mortgaged
Property issued by a title insurer reasonably satisfactory to the Agents
(the "Mortgage Policies") in amounts satisfactory to the Agents assuring
the Collateral Agent that the Mortgages on such Mortgaged Properties are
valid and enforceable first priority mortgage liens on the respective
Mortgaged Properties, free and clear of all defects and encumbrances except
Permitted Encumbrances and such Mortgage Policies shall otherwise be in
form and substance reasonably satisfactory to the Agents and shall include,
as appropriate, an endorsement for future advances under this Agreement and
the Notes and for any other matter that any Agent in its reasonable
discretion may reasonably request, shall not include (to the extent
permissible under applicable state law) an exception for mechanics' liens,
and shall provide for affirmative insurance and such reinsurance as any
Agent in its discretion may reasonably request;
(iii) a survey, in form and substance reasonably satisfactory to the
Agents, of each such Mortgaged Property, certified by a licensed
professional surveyor reasonably satisfactory to the Agents; and
(iv) such landlord waivers and/or estoppel certificates as any Agent
may have reasonably required, which landlord waivers and/or estoppel
certificates shall be in form and substance reasonably satisfactory to the
Agents.
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5.14 Projections; Pro Forma Balance Sheet. On or prior to the Initial
Borrowing Date, the Agents shall have received copies of the financial
statements (including the pro forma financial statements) and Projections
referred to in Sections 7.05(a) and (d).
5.15 Solvency Certificate; Insurance Certificates. On the Initial
Borrowing Date, the Borrower shall have delivered to the Agents:
(i) a solvency certificate from the Chief Financial Officer of the
Borrower in the form of Exhibit J; and
(ii) certificates of insurance complying with the requirements of
Section 8.03 for the business and properties of the Borrower and its
Subsidiaries, in form and substance satisfactory to the Agents and naming
the Collateral Agent as an additional insured and as loss payee, and
stating that such insurance shall not be cancelled without at least 30 days
prior written notice by the insurer to the Collateral Agent (or such
shorter period of time as a particular insurance company generally
provides).
5.16 Fees, etc. On the Initial Borrowing Date, the Borrower shall have
paid to the Agents and each Bank all costs, fees and expenses (including,
without limitation, legal fees and expenses) payable to the Agents and such Bank
to the extent then due.
SECTION 6. Conditions Precedent to All Credit Events. The obligation
of each Bank to make Loans (including Loans made on the Initial Borrowing Date),
and the obligation of any Issuing Bank to issue any Letter of Credit (including
Letters of Credit issued on the Initial Borrowing Date), is subject, at the time
of each such Credit Event (except as hereinafter indicated), to the satisfaction
of the following conditions:
6.01 No Default; Representations and Warranties. At the time of each
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein or in the other Credit Documents shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of such Credit Event (it being understood
and agreed that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct in all material
respects only as of such specified date).
6.02 Notice of Borrowing; Letter of Credit Request. (a) Prior to the
making of each Loan (other than a Swingline Loan or a Revolving Loan made
pursuant to a Mandatory Borrowing), the Administrative Agent shall have received
a Notice of Borrowing meeting the requirements of Section 1.03(a). Prior to the
making of each Swingline Loan, the Swingline Bank shall have received the notice
referred to in Section 1.03(b)(i).
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(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the respective Issuing Bank shall have received a
Letter of Credit Request meeting the requirements of Section 2.03.
The acceptance of the proceeds of each Loan and the making of each
Letter of Credit Request shall constitute a representation and warranty by the
Borrower to the Agents and each of the Banks that all the conditions specified
in Section 5 (with respect to Credit Events on the Initial Borrowing Date) and
in this Section 6 (with respect to Credit Events on and after the Initial
Borrowing Date) and applicable to such Credit Event exist as of that time. All
of the Notes, certificates, legal opinions and other documents and papers
referred to in Section 5 and in this Section 6, unless otherwise specified,
shall be delivered to the Administrative Agent at the Notice Office for the
account of each of the Banks and, except for the Notes, in sufficient
counterparts or copies for each of the Banks and shall be in form and substance
reasonably satisfactory to the Agents and the Required Banks.
SECTION 7. Representations, Warranties and Agreements. In order to
induce the Banks to enter into this Agreement and to make the Loans, and issue
(or participate in) the Letters of Credit as provided herein, the Borrower makes
the following representations, warranties and agreements, in each case after
giving effect to the Transaction, all of which shall survive the execution and
delivery of this Agreement and the Notes and the making of the Loans and
issuance of the Letters of Credit, with the occurrence of each Credit Event on
or after the Initial Borrowing Date being deemed to constitute a representation
and warranty that the matters specified in this Section 7 are true and correct
in all material respects on and as of the Initial Borrowing Date and on the date
of each such Credit Event (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct only as of such specified date).
7.01 Corporate and Other Status. Each Credit Party and each of its
Subsidiaries (i) is a duly organized and validly existing corporation or
partnership, as the case may be, in good standing under the laws of the
jurisdiction of its organization, (ii) has the corporate or partnership power
and authority to own its property and assets and to transact the business in
which it is engaged and presently proposes to engage and (iii) is duly qualified
and is authorized to do business and is in good standing in each jurisdiction
where the ownership, leasing or operation of its property or the conduct of its
business requires such qualifications except for failures to be so qualified
which, individually or in the aggregate, could not reasonably be expected to
have a material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower or
the Borrower and its Subsidiaries taken as a whole.
7.02 Corporate and Other Power and Authority. Each Credit Party has
the corporate or partnership power and authority to execute, deliver and perform
the terms and provisions of each of the Documents to which it is party and has
taken all necessary corporate or partnership action to authorize the execution,
delivery and performance by it of each of such Documents. Each Credit Party has
duly executed and delivered each of the Documents to
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which it is party, and each of such Documents constitutes its legal, valid and
binding obligation enforceable in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or performance by
any Credit Party of the Documents to which it is a party, nor compliance by it
with the terms and provisions thereof, (i) will contravene any provision of any
law, statute, rule or regulation or any order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict with or result in any
breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien (except pursuant to the Security
Documents) upon any of the property or assets of the Borrower or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust,
credit agreement or loan agreement, or any other material agreement, contract or
instrument, to which the Borrower or any of its Subsidiaries is a party or by
which it or any of its property or assets is bound or to which it may be subject
or (iii) will violate any provision of the certificate of incorporation, by-laws
or partnership agreement (or equivalent organizational documents) of the
Borrower or any of its Subsidiaries.
7.04 Approvals. (a) No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except for those that have otherwise been obtained or made on or prior to the
Initial Borrowing Date and which remain in full force and effect on the Initial
Borrowing Date, or to the extent not required to be obtained or made on or prior
to the Initial Borrowing Date, as will be obtained or made on or prior to the
required date therefor), or exemption by, any governmental or public body or
authority, or any subdivision thereof, is required to authorize, or is required
in connection with, (i) the execution, delivery and performance of any Document
or (ii) the legality, validity, binding effect or enforceability of any such
Document.
(b) All necessary shareholder and board of director approvals and/or
consents and all material third party non-governmental approvals and/or consents
required to be obtained by the Borrower, SKL or any Credit Party, in each case
in connection with the Transaction and the execution, delivery and performance
of any Document have been obtained by the Borrower, SKL and each Credit Party
and remain in full force and effect on the Initial Borrowing Date.
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Financial Statements; Financial Condition; Undisclosed Liabilities;
Projections; etc. (a) The consolidated balance sheet of the Borrower and its
Subsidiaries at September 30, 1996 and September 30, 1997 and the related
consolidated statements of operations, cash flows and shareholders' equity of
the Borrower and its Subsidiaries for the fiscal years ended on such dates,
respectively, copies of which have been furnished to the Banks prior to the
Initial Borrowing Date, present fairly the financial position of the Borrower
and its Subsidiaries at the date of such balance sheets and the results of the
operations of the
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Borrower and its Subsidiaries for the periods covered thereby. Except as set
forth in Section 3.4(b) of the Seller Disclosure Schedules to the Asset Purchase
Agreement, the balance sheet of the Acquired Business at December 31, 1996 and
September 30, 1997 and the related statements of income, cash flows and
shareholders' equity of the Acquired Business for the fiscal year and nine-month
periods ended on such dates, respectively, copies of which have been furnished
to the Banks prior to the Initial Borrowing Date, present fairly the financial
position of the Acquired Business at the date of such balance sheets and the
results of the operations of the Acquired Business for the periods covered
thereby. Except as set forth in Section 3.4(b) of the Seller Disclosure
Schedules to the Asset Purchase Agreement insofar as it relates to the financial
statements of the Acquired Business, the Borrower, in good faith, believes that
all financial statements referred to in the two immediately preceding sentences
have been prepared in accordance with generally accepted accounting principles
consistently applied, subject to normal year-end audit adjustments in the case
of the September 30, 1997 Borrower financial statements and the September 30,
1997 Acquired Business financial statements referred to above. The Borrower has
delivered to the Banks a pro forma consolidated balance sheet of the Borrower
and its Subsidiaries (including the Acquired Business) at September 30, 1997 and
pro forma income statements of the Borrower and its Subsidiaries (including the
Acquired Business) for the fiscal year ended September 30, 1997, prepared on the
assumption that the Transaction had been consummated on October 1, 1996. After
giving effect to the Transaction (but for this purpose assuming that the
Transaction had occurred prior to September 30, 1996), since September 30, 1996,
there has been no material adverse change in the business, operations, property,
assets, liabilities, condition (financial or otherwise) or prospects of the
Borrower or the Borrower and its Subsidiaries taken as a whole.
(b) (i) On and as of the Initial Borrowing Date and after giving
effect to the Transaction and to all Indebtedness (including the Loans) being
incurred or assumed and Liens created by the Credit Parties in connection
therewith, (a) the sum of the assets, at a fair valuation, of each of the
Borrower on a stand alone basis and of the Borrower and its Subsidiaries taken
as a whole will exceed its debts; (b) each of the Borrower on a stand alone
basis and the Borrower and its Subsidiaries taken as a whole has not incurred
and does not intend to incur, and does not believe that they will incur, debts
beyond their ability to pay such debts as such debts mature; and (c) each of the
Borrower on a stand alone basis and the Borrower and its Subsidiaries taken as a
whole will have sufficient capital with which to conduct its business. For
purposes of this Section 7.05(b), "debt" means any liability on a claim, and
"claim" means (i) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (ii) right to
an equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured. 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.
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(c) Except as fully disclosed in the financial statements delivered
pursuant to Section 7.05(a) there were as of the Initial Borrowing Date no
liabilities or obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due) which, either individually or in aggregate,
could reasonably be expected to have a material and adverse effect on the
Borrower and its Subsidiaries taken as a whole. As of the Initial Borrowing
Date, the Borrower does not know of any basis for the assertion against it or
any of its Subsidiaries of any liability or obligation of any nature whatsoever
that is not fully disclosed in the financial statements delivered pursuant to
Section 7.05(a) which, either individually or in the aggregate, could reasonably
be expected to be material to the Borrower or the Borrower and its Subsidiaries
taken as a whole.
(d) On and as of the Initial Borrowing Date, the Projections
delivered to the Agents and the Banks prior to the Initial Borrowing Date have
been prepared in good faith and are based on reasonable assumptions. On the
Initial Borrowing Date, the Borrower believes that the Projections are
reasonable, it being understood that the Projections include assumptions as to
future events that are not to be viewed as facts and that actual results may
differ from the projected results and such differences may be material.
7.06 Litigation. There are no actions, suits or proceedings pending
or, to the best knowledge of the Borrower, threatened (i) with respect to any
Document or (ii) that are reasonably likely to materially and adversely affect
the business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower or the Borrower and its Subsidiaries
taken as a whole.
7.07 True and Complete Disclosure. All factual information (taken as a
whole) furnished by any Credit Party in writing to any Agent or any Bank
(including, without limitation, all information contained in the Documents) for
purposes of or in connection with this Agreement, the other Credit Documents or
any transaction contemplated herein or therein is, and all other such factual
information hereafter furnished by or on behalf of any Credit Party in writing
to any Agent or any Bank will be, true and accurate in all material respects on
the date as of which such information is dated or certified and not incomplete
by omitting to state any fact necessary to make such information not misleading
in any material respect at such time in light of the circumstances under which
such information was provided.
7.08 Use of Proceeds; Margin Regulations. (a) All proceeds of the Term
Loans will be used by the Borrower (i) to effect the Acquisition and the
Refinancing and (ii) to pay fees and expenses related to the Transaction.
(b) The proceeds of all Revolving Loans and all Swingline Loans will
be used for the Borrower's and its Subsidiaries' general corporate and working
capital purposes.
(c) No part of any Credit Event (or the proceeds thereof) will be
used to purchase or carry any Margin Stock or to extend credit for the purpose
of purchasing or carrying any Margin Stock. Neither the making of any Loan nor
the use of the proceeds
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thereof nor the occurrence of any other Credit Event will violate or be
inconsistent with the provisions of Regulation G, T, U or X of the Board of
Governors of the Federal Reserve System.
7.09 Tax Returns and Payments. Each of the Borrower and each of its
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it which have become due, except for
those contested in good faith and adequately disclosed and fully provided for on
the financial statements of the Borrower and its Subsidiaries in accordance with
generally accepted accounting principles. The Borrower and each of its
Subsidiaries have at all times paid, or have provided adequate reserves (in the
good faith judgment of the management of the Borrower) for the payment of, all
federal, state and foreign income taxes applicable for all prior fiscal years
and for the current fiscal year to date. There is no material action, suit,
proceeding, investigation, audit, or claim now pending or, to the knowledge of
the Borrower or any of its Subsidiaries, threatened by any authority regarding
any taxes relating to the Borrower or any of its Subsidiaries. Neither the
Borrower nor any of its Subsidiaries has entered into an agreement or waiver or
been requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Borrower or
any of its Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of the Borrower or any of its
Subsidiaries not to be subject to the normally applicable statute of
limitations.
7.10 Compliance with ERISA. (i) Each Plan and to the knowledge of the
Borrower each Multiemployer Plan (and each related trust, insurance contract or
fund) is in substantial compliance with its terms and with all applicable laws,
including, without limitation, ERISA and the Code; each Plan and to the
knowledge of the Borrower each Multiemployer Plan (and each related trust, if
any) which is intended to be qualified under Section 401(a) of the Code has
received a determination letter from the Internal Revenue Service to the effect
that it meets the requirements of Sections 401(a) and 501(a) of the Code; no
Reportable Event has occurred with respect to a Plan; to the knowledge of the
Borrower, no Multiemployer Plan is insolvent or in reorganization; no Plan has
an Unfunded Current Liability; no Plan and to the knowledge of the Borrower no
Multiemployer Plan which is subject to Section 412 of the Code or Section 302 of
ERISA has an accumulated funding deficiency, within the meaning of such sections
of the Code or ERISA, or has applied for or received a waiver of an accumulated
funding deficiency or an extension of any amortization period, within the
meaning of Section 412 of the Code or Section 303 or 304 of ERISA; all material
contributions required to be made by the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate with respect to a Plan or a Multiemployer Plan
have been timely made; neither the Borrower nor any Subsidiary of the Borrower
nor any ERISA Affiliate has incurred any material liability (including any
indirect or secondary liability) to or on account of a Plan pursuant to Section
409, 502(i), 502(l), 4062, 4063, 4064 or 4069 of ERISA or Section 401(a)(29),
4971 or 4975 of the Code or expects to incur any such material liability under
any of the foregoing sections with respect to any Plan; to the knowledge of the
Borrower and its Subsidiaries, no condition exists which presents a material
risk to the Borrower or any
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Subsidiary of the Borrower or any ERISA Affiliate of incurring a material
liability to or on account of a Plan pursuant to the foregoing provisions of
ERISA and the Code; no proceedings have been instituted to terminate or appoint
a trustee to administer any Plan which is subject to Title IV of ERISA; no
action, suit, proceeding, hearing, audit or investigation with respect to the
administration, operation or the investment of assets of any Plan (other than
routine claims for benefits) is pending or, to the knowledge of the Borrower and
its Subsidiaries, threatened; using actuarial assumptions and computation
methods consistent with Part 1 of subtitle E of Title IV of ERISA, the aggregate
liabilities of the Borrower and its Subsidiaries and its ERISA Affiliates to all
Multiemployer Plans in the event of a complete withdrawal therefrom, as of the
close of the most recent fiscal year of each such Plan ended prior to the date
of this Agreement and with respect to fiscal years ended prior to the date of
each Credit Event would not be material; each group health plan (as defined in
Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) which covers or has
covered employees or former employees of the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate has at all times been operated in substantial
compliance with the provisions of Part 6 of subtitle B of Title I of ERISA and
Section 4980B of the Code; no lien imposed under the Code or ERISA on the assets
of the Borrower or any Subsidiary of the Borrower or any ERISA Affiliate exists
or is likely to arise on account of any Plan; neither the Borrower nor any
Subsidiary of the Borrower nor any ERISA Affiliate has incurred any material
liability (including any indirect or secondary liability) under Sections 515,
4201, 4202 or 4212 of ERISA with respect to any Multiemployer Plan; to the
knowledge of the Borrower, no condition exists which presents a material risk to
the Borrower or any Subsidiary of the Borrower or any ERISA Affiliate of
incurring a material liability to or on account of a Multiemployer Plan pursuant
to the foregoing provisions of ERISA; to the knowledge of the Borrower and its
Subsidiaries, no action, suit, proceeding, hearing, audit or investigation with
respect to the administration, operation or the investment of assets of any
Multiemployer Plan (other than routine claims for benefits) that could
reasonably be expected to be material to the Borrower or the Borrower and its
Subsidiaries taken as a whole is pending or threatened; and the Borrower and its
Subsidiaries do not maintain or contribute to any employee welfare benefit plan
(as defined in Section 3(1) of ERISA), which provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or any Plan or Multiemployer Plan, the obligations with respect to which
could reasonably be expected to have a material adverse effect on the ability of
the Borrower or any of its Subsidiaries to perform their respective obligations
under the Credit Documents.
(ii) To the knowledge of the Borrower and its Subsidiaries, each
Foreign Pension Plan has been maintained in substantial compliance with its
terms and with the requirements of any and all applicable laws, statutes, rules,
regulations and orders and has been maintained, where required, in good standing
with applicable regulatory authorities. All material contributions required to
be made with respect to a Foreign Pension Plan have been timely made. Neither
the Borrower nor any of its Subsidiaries has incurred any material obligation in
connection with the termination of or withdrawal from any Foreign Pension Plan.
The Borrower and its Subsidiaries do not maintain or contribute to any Foreign
Pension Plan the obligations with respect to which could reasonably be expected
to have a material adverse
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effect on the ability of the Borrower or the Borrower and its Subsidiaries taken
as a whole to perform their obligations under the Credit Documents.
7.11 The Security Documents. (a) The provisions of the Security
Agreement are effective to create in favor of the Collateral Agent for the
benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of the Credit Parties party thereto in
the Security Agreement Collateral described therein, and the Collateral Agent,
for the benefit of the Secured Creditors, has a fully perfected lien on, and
security interest in, all right, title and interest in all of the Security
Agreement Collateral described therein, subject to no other Liens other than
Permitted Liens. The recordation of the Assignment of Security Interest in U.S.
Patents and Trademarks in the form attached to the Security Agreement in the
United States Patent and Trademark Office together with filings on Form UCC-1
made pursuant to the Security Agreement will create, as may be perfected by such
filing and recordation, a perfected security interest granted to the Collateral
Agent in the trademarks and patents covered by the Security Agreement and the
recordation of the Assignment of Security Interest in U.S. Copyrights in the
form attached to the Security Agreement with the United States Copyright Office
together with filings on Form UCC-1 made pursuant to the Security Agreement will
create, as may be perfected by such filing and recordation, a perfected security
interest granted to the Collateral Agent in the copyrights covered by the
Security Agreement.
(b) The security interests created in favor of the Collateral Agent,
as Pledgee, for the benefit of the Secured Creditors, under the Pledge Agreement
constitute first priority perfected security interests in the Pledged Securities
described in the Pledge Agreement, subject to no security interests of any other
Person. No filings or recordings are required in order to perfect (or maintain
the perfection or priority of) the security interests created in the Pledged
Securities under the Pledge Agreement.
(c) The Mortgages create, for the obligations purported to be secured
thereby, a valid and enforceable perfected security interest in and mortgage
lien on all of the Mortgaged Properties in favor of the Collateral Agent (or
such other trustee as may be required or desired under local law) for the
benefit of the Secured Creditors, superior to and prior to the rights of all
third persons (except that the security interest and mortgage lien created in
the Mortgaged Properties may be subject to the Permitted Encumbrances related
thereto) and subject to no other Liens (other than Liens permitted under Section
9.01). Schedule III contains a true and complete list of each parcel of Real
Property owned or leased by the Borrower and its Subsidiaries on the Initial
Borrowing Date, and the type of interest therein held by the Borrower or such
Subsidiary. The Borrower and each of its Subsidiaries have (i) good and
marketable title to all fee-owned Real Property free and clear of all Liens
except those described in the first sentence of this subsection (c) and (ii)
valid leasehold title to all Leaseholds.
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7.12 Representations and Warranties in Acquisition Documents. All
representations and warranties set forth in the Acquisition Documents were true
and correct at the time as of which such representations and warranties were (or
are) made (or deemed made), except for such inaccuracies which, either
individually or in the aggregate, are not reasonably likely to have a material
adverse effect on the business, operations, property, assets, condition
(financial or otherwise) or prospects of the Acquired Business.
7.13 Properties. The Borrower and each of its Subsidiaries have good
and marketable title to all material properties owned by them, including all
material property reflected in the balance sheets referred to in Section 7.05(a)
and all material property acquired pursuant to the Acquisition (except as sold
or otherwise disposed of since the date of such balance sheets in the ordinary
course of business), free and clear of all Liens, other than Liens permitted by
Section 9.01.
7.14 Capitalization. On the Initial Borrowing Date, the authorized
capital stock of the Borrower shall consist of (i) 100,000,000 shares of common
stock, $.01 par value per share, of which 14,250,000 shares of such common stock
are issued and outstanding and (ii) 1,500,000 shares of preferred stock, $.01
par value per value, none of which shares of such preferred stock are issued or
outstanding. All outstanding shares of capital stock of the Borrower have been
duly and validly issued, are fully paid and nonassessable. Except for options or
warrants to purchase shares of common stock of the Borrower held by employees
and directors of the Borrower or any of its Subsidiaries, as of the Initial
Borrowing Date, the Borrower does not have outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreement providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to, its capital stock.
7.15 Subsidiaries. As of the Initial Borrowing Date, the Borrower has
no Subsidiaries other than those Subsidiaries listed on Schedule V. Schedule V
correctly sets forth, as of the Initial Borrowing Date, the percentage ownership
(direct or indirect) of the Borrower in each class of capital stock or other
equity of each of its Subsidiaries and also identifies the direct owner thereof.
7.16 Compliance with Statutes, etc. Each of the Borrower and each of
its Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including applicable statutes, regulations, orders and
restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower or the Borrower and its Subsidiaries taken as a whole.
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7.17 Investment Company Act. Neither the Borrower nor any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
7.18 Public Utility Holding Company Act. Neither the Borrower nor any
of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
7.19 Environmental Matters. (a) The Borrower and each of its
Subsidiaries have complied with, and on the date of such Credit Event are in
compliance with, all applicable Environmental Laws and the requirements of any
permits issued under such Environmental Laws. There are no pending or, to the
best knowledge of the Borrower, threatened Environmental Claims against the
Borrower or any of its Subsidiaries (including any such claim arising out of the
ownership or operation by the Borrower or any of its Subsidiaries of any Real
Property no longer owned or operated by the Borrower or any of its Subsidiaries)
or any Real Property owned or operated by the Borrower or any of its
Subsidiaries. There are no facts, circumstances, conditions or occurrences with
respect to any Real Property owned or operated by the Borrower or any of its
Subsidiaries (including any Real Property formerly owned or operated by the
Borrower or any of its Subsidiaries but no longer owned or operated by the
Borrower or any of its Subsidiaries) or, to the best knowledge of the Borrower,
any property adjoining or adjacent to any such Real Property that could
reasonably be expected (i) to form the basis of an Environmental Claim against
the Borrower or any of its Subsidiaries or any Real Property owned or operated
by the Borrower or any of its Subsidiaries, or (ii) to cause any Real Property
owned or operated by the Borrower or any of its Subsidiaries to be subject to
any restrictions on the ownership, occupancy or transferability of such Real
Property by the Borrower or any of its Subsidiaries under any applicable
Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, any Real Property owned or
operated by the Borrower or any of its Subsidiaries where such generation, use,
treatment or storage has violated or could reasonably be expected to violate any
Environmental Law. Hazardous Materials have not at any time been Released on or
from any Real Property owned or operated by the Borrower or any of its
Subsidiaries where such Release has violated or could reasonably be expected to
violate any applicable Environmental Law.
(c) Notwithstanding anything to the contrary in this Section 7.19,
the representations made in this Section 7.19 shall not be untrue unless the
aggregate effect of all violations, claims, restrictions, failures and
noncompliances of the types described above could reasonably be expected to have
a material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower or
the Borrower and its Subsidiaries taken as a whole.
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7.20 Labor Relations. Neither the Borrower nor any of its Subsidiaries
is engaged in any unfair labor practice that could reasonably be expected to
have a material adverse effect on the Borrower or the Borrower and its
Subsidiaries taken as a whole. There is (i) no unfair labor practice complaint
pending against the Borrower or any of its Subsidiaries or, to the best
knowledge of the Borrower or any of its Subsidiaries, threatened against any of
them, before the National Labor Relations Board, and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against the Borrower or any of its Subsidiaries or, to the best
knowledge of the Borrower, threatened against any of them, (ii) no strike, labor
dispute, slowdown or stoppage pending against the Borrower or any of its
Subsidiaries or, to the best knowledge of the Borrower or any of its
Subsidiaries, threatened against the Borrower or any of its Subsidiaries and
(iii) no union representation question exists with respect to the employees of
the Borrower or any of its Subsidiaries, except (with respect to any matter
specified in clause (i), (ii) or (iii) above, either individually or in the
aggregate) such as could not reasonably be expected to have a material adverse
effect on the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower or any of its Subsidiaries
and its Subsidiaries taken as a whole.
7.21 Patents, Licenses, Franchises and Formulas. Each of the Borrower
and each of its Subsidiaries owns all the patents, trademarks, permits, service
marks, trade names, copyrights, licenses, franchises, proprietary information
(including but not limited to rights in computer programs and databases) and
formulas, or rights with respect to the foregoing, and has obtained assignments
of all leases and other rights of whatever nature, necessary for the present
conduct of its business, without any known conflict with the rights of others
which, or the failure to obtain which, as the case may be, could reasonably be
expected to result in a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower or the Borrower and its Subsidiaries taken as a whole.
7.22 Indebtedness. Schedule VI sets forth a true and complete list of
all Indebtedness (including Contingent Obligations) of the Borrower and its
Subsidiaries as of the Initial Borrowing Date and which is to remain outstanding
after giving effect to the Transaction (excluding the Loans, the Letters of
Credit and Indebtedness permitted under Section 9.04(iii), the "Existing
Indebtedness"), in each case showing the aggregate principal amount thereof and
the name of the respective borrower and any Credit Party or any of its
Subsidiaries which directly or indirectly guaranteed such debt.
7.23 Transaction. At the time of consummation thereof, the Transaction
shall have been consummated in accordance with the terms of the respective
Documents and all applicable laws. At the time of consummation thereof, all
material consents and approvals of, and filings and registrations with, and all
other actions in respect of, all governmental agencies, authorities or
instrumentalities required in order to make or consummate the Transaction to the
extent then required have been obtained, given, filed or taken and are or will
be in full force and effect (or effective judicial relief with respect thereto
has been obtained). All applicable waiting periods with respect thereto have or,
prior to the time when required, will have,
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expired without, in all such cases, any action being taken by any competent
authority which restrains, prevents, or imposes material adverse conditions upon
the Transaction. Additionally, there does not exist any judgment, order or
injunction prohibiting or imposing material adverse conditions upon the
Transaction, or the occurrence of any Credit Event or the performance by any
Credit Party of its obligations under the Documents to which it is party. All
actions taken by each Credit Party pursuant to or in furtherance of the
Transaction have been taken in compliance in all material respects with the
respective Documents and all applicable laws.
SECTION 8. Affirmative Covenants. The Borrower hereby covenants and
agrees that on and after the Effective Date and until the Total Commitments and
all Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings,
together with interest, Fees and all other Obligations incurred hereunder and
thereunder, are paid in full:
8.01 Information Covenants. The Borrower will furnish to each Bank:
(a) Quarterly Financial Statements. Within 45 days after the close of
the first three quarterly accounting periods in each fiscal year of the
Borrower, (i) the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such quarterly accounting period and the related
consolidated statements of income and retained earnings and statement of cash
flows for such quarterly accounting period and for the elapsed portion of the
fiscal year ended with the last day of such quarterly accounting period, in each
case setting forth comparative figures for the related periods in the prior
fiscal year, all of which shall be certified by the Chief Financial Officer of
the Borrower or another senior financial officer of the Borrower, subject to
normal year-end audit adjustments and (ii) management's discussion and analysis
of the important operational and financial developments during the quarterly and
year-to-date periods, it being understood that the delivery by the Borrower of
its Form 10-Q as filed with the SEC shall satisfy the requirements of this
Section 8.01(a).
(b) Annual Financial Statements. Within 90 days after the close of
each fiscal year of the Borrower, (i) the consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year and the related
consolidated statements of income and retained earnings and of cash flows for
such fiscal year setting forth comparative figures for the preceding fiscal year
and certified by Price Waterhouse LLP, any other "Big Six" independent certified
public accountants or such other independent certified public accountants of
recognized national standing reasonably acceptable to the Agents, in each case
to the effect that such statements fairly present in all material respects the
financial condition of the Borrower and its Subsidiaries as of the dates
indicated and the results of their operations and changes in its financial
position for the periods indicated in conformity with generally accepted
accounting principles applied on a basis consistent with prior years, together
with a certificate of such accounting firm stating that in the course of its
regular audit of the business of the Borrower and its Subsidiaries, which audit
was conducted in accordance with generally accepted auditing standards, no
Default or Event of Default which has occurred and is continuing has come to
their attention or, if such a Default or an Event of Default has come to their
attention a statement as to the nature thereof.
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(c) Management Letters. Promptly after the Borrower's or any of its
Subsidiaries' receipt thereof, a copy of any "management letter" received from
its certified public accountants.
(d) Budgets. No later than the 60th day following the start of the
fiscal year beginning October 1, 1997 and the 30th day following the start of
each succeeding fiscal year of the Borrower, a budget in form satisfactory to
the Agents (including budgeted statements of income and sources and uses of cash
and balance sheets, with such information to be set forth on a quarterly basis)
prepared by the Borrower for such fiscal year prepared in detail, setting forth,
with appropriate discussion, the principal assumptions upon which such budget
was based.
(e) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.01(a) and (b), a certificate of
the Chief Financial Officer of the Borrower or another senior financial officer
of the Borrower acceptable to the Agents to the effect that, to the best of such
officer's knowledge, no Default or Event of Default has occurred and is
continuing or, if any Default or Event of Default has occurred and is
continuing, specifying the nature and extent thereof, which certificate shall
(x) set forth in reasonable detail the calculations required to establish
whether the Borrower and its Subsidiaries were in compliance with the provisions
of Sections 9.08 through 9.10, inclusive, at the end of such fiscal quarter or
year, as the case may be and (y) if delivered with the financial statements
required by Section 8.01(b), set forth in reasonable detail the calculations
required to establish whether the Borrower and its Subsidiaries were in
compliance with the provisions of Sections 4.02(e) and 9.07 as at the end of
such fiscal year and the amount of (and the calculations required to establish
the amount of) Excess Cash Flow for the respective Excess Cash Payment Period.
(f) Notice of Default or Litigation. Promptly upon, and in any event
within three Business Days after, an officer of the Borrower obtains knowledge
thereof, notice of (i) the occurrence of any event which constitutes a Default
or an Event of Default and (ii) any litigation or governmental investigation or
proceeding pending (x) against the Borrower or any of its Subsidiaries which
could reasonably be expected to materially and adversely affect the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole
or (y) with respect to the Transaction or any Document.
(g) Other Reports and Filings. Promptly after the filing or delivery
thereof, copies of all financial information, proxy materials and reports, if
any, which the Borrower or any of its Subsidiaries shall publicly file with the
Securities and Exchange Commission or any successor thereto (the "SEC") or
deliver to holders of its Indebtedness pursuant to the terms of the
documentation governing such Indebtedness (or any trustee, agent or other
representative therefor).
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(h) Environmental Matters. Promptly upon, and in any event within
ten Business Days after, an officer of the Borrower obtains knowledge thereof,
notice of one or more of the following environmental matters, unless such
environmental matters could not, individually or when aggregated with all other
such environmental matters, be reasonably expected to materially and adversely
affect the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower or the Borrower and its
Subsidiaries taken as a whole:
(i) any pending or threatened Environmental Claim against the Borrower
or any of its Subsidiaries or any Real Property owned or operated by the
Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any Real Property
owned or operated by the Borrower or any of its Subsidiaries that (a)
results in noncompliance by the Borrower or any of its Subsidiaries with
any applicable Environmental Law or (b) could reasonably be expected to
form the basis of an Environmental Claim against the Borrower or any of its
Subsidiaries or any such owned or operated Real Property;
(iii) any condition or occurrence on any Real Property owned or
operated by the Borrower or any of its Subsidiaries that could reasonably
be expected to cause such Real Property to be subject to any restrictions
on the ownership, occupancy, use or transferability by the Borrower or any
of its Subsidiaries of such Real Property under any Environmental Law; and
(iv) the taking of any removal or remedial action in response to the
actual or alleged presence of any Hazardous Material on any Real Property
owned or operated by the Borrower or any of its Subsidiaries as required by
any Environmental Law or any governmental or other administrative agency;
provided, that in any event the Borrower shall deliver to each Bank all
notices received by the Borrower or any of its Subsidiaries from any
government or governmental agency under, or pursuant to, CERCLA which
identify the Borrower or any of its Subsidiaries as potentially responsible
parties for remediation costs which reasonably could be expected to exceed
$500,000 or which otherwise notify the Borrower or any of its Subsidiaries
of potential liability which reasonably could be expected to exceed
$500,000 under CERCLA.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action
and the Borrower's or such Subsidiary's response thereto.
(i) Other Information. From time to time, such other information or
documents (financial or otherwise) with respect to the Borrower or any of its
Subsidiaries as any Agent or any Bank may reasonably request.
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8.02 Books, Records and Inspections. The Borrower will, and will cause
each of its Subsidiaries to, keep proper books of record and accounts in which
full, true and correct entries in conformity with generally accepted accounting
principles and all requirements of law shall be made of all dealings and
transactions in relation to its business and activities. Upon reasonable notice
to the Borrower, the Borrower will, and will cause each of its Subsidiaries to,
permit officers and designated representatives of any Agent or any Bank to visit
and inspect, under guidance of officers of the Borrower or such Subsidiary, any
of the properties owned or leased by the Borrower or such Subsidiary, and to
examine the books of account of the Borrower or such Subsidiary and discuss the
affairs, finances and accounts of the Borrower or such Subsidiary with, and be
advised as to the same by, its and their officers and independent accountants,
all at such reasonable times and intervals and to such reasonable extent as such
Agent or such Bank may request.
8.03 Maintenance of Property; Insurance. (a) Schedule VII sets forth a
true and complete listing of all insurance maintained by the Borrower and its
Subsidiaries as of the Initial Borrowing Date. The Borrower will, and will cause
each of its Subsidiaries to, (i) keep all property owned or leased by the
Borrower and its Subsidiaries necessary to the business of the Borrower and its
Subsidiaries in reasonably good working order and condition, ordinary wear and
tear excepted, (ii) maintain, with financially sound and reputable insurers,
insurance on all such property (including, without limitation, flood insurance
to the extent applicable) in at least such amounts and against at least such
risks as is consistent and in accordance with industry practice for companies
similarly situated owning similar properties in the same general areas in which
the Borrower or any of its Subsidiaries operates, and (iii) furnish to any Agent
or any Bank, upon written request, full information as to the insurance carried.
(b) The Borrower will, and will cause each of the other Credit
Parties to, at all times keep its property insured, with the Collateral Agent
named as loss payee or additional insured, and all policies (including Mortgage
Policies) or certificates (or certified copies thereof) with respect to such
insurance (and any other insurance maintained by the Borrower and/or such other
Credit Parties) shall (i) name the Collateral Agent as loss payee and/or
additional insured) and (ii) state that such insurance policies shall not be
cancelled without at least 30 days' prior written notice thereof by the
respective insurer to the Collateral Agent (or such shorter period of time as a
particular insurance company policy generally provides).
(c) If the Borrower or any of its Subsidiaries shall fail to insure
its property in accordance with this Section 8.03, or if the Borrower or any of
its Subsidiaries shall fail to so name the Collateral Agent as a loss payee or
additional insured with respect thereto, the Collateral Agent shall have the
right (but shall be under no obligation), after giving the Borrower prior
written notice, to procure such insurance and the Borrower agrees to reimburse
the Collateral Agent for all costs and expenses of procuring such insurance or
naming the Collateral Agent as a loss payee or additional insured with respect
thereto.
8.04 Corporate Franchises. The Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force
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and effect its existence and its material rights, franchises, licenses and
patents; provided, however, that nothing in this Section 8.04 shall prevent (i)
sales of assets, mergers and other transactions by the Borrower or any of its
Subsidiaries in accordance with Section 9.02 or (ii) the withdrawal by the
Borrower or any of its Subsidiaries of its qualification as a foreign
corporation in any jurisdiction where such withdrawal could not reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower or the Borrower and its Subsidiaries taken as a whole.
8.05 Compliance with Statutes, etc. The Borrower will, and will cause
each of its Subsidiaries to, comply with all applicable statutes, regulations
and orders of, and all applicable restrictions imposed by, all governmental
bodies, domestic or foreign, in respect of the conduct of its business and the
ownership of its property (including applicable statutes, regulations, orders
and restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower or the Borrower and its Subsidiaries taken as a whole.
8.06 Compliance with Environmental Laws. (a) The Borrower will
comply, and will cause each of its Subsidiaries to comply, with all
Environmental Laws applicable to the ownership or use of its Real Property now
or hereafter owned or operated by the Borrower or any of its Subsidiaries
(except such noncompliances as could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a
whole), will promptly pay or cause to be paid all costs and expenses incurred in
connection with such compliance, and will keep or cause to be kept all such Real
Property free and clear of any Liens imposed pursuant to such Environmental
Laws. Neither the Borrower nor any of its Subsidiaries will generate, use,
treat, store, release or dispose of, or permit the generation, use, treatment,
storage, release or disposal of Hazardous Materials on any Real Property now or
hereafter owned or operated by the Borrower or any of its Subsidiaries, or
transport or permit the transportation of Hazardous Materials to or from any
such Real Property, except to the extent that any such generation, use,
treatment, storage, release or disposal could not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower or the Borrower and its Subsidiaries
taken as a whole.
(b) At the written request of the Agents or the Required Banks, which
request shall specify in reasonable detail the basis therefor, at any time and
from time to time, the Borrower will provide, at the sole expense of the
Borrower, an environmental site assessment report concerning any Real Property
owned or operated by the Borrower or any of its Subsidiaries, prepared by an
environmental consulting firm reasonably approved by the Agents, indicating the
presence or absence of Hazardous Materials and the potential cost of
-52-
any removal or remedial action in connection with such Hazardous Materials on
such Real Property, provided that in no event shall such request be made more
often than once every two years for any particular Real Property unless either
(i) the Obligations have been declared (or have become) due and payable pursuant
to Section 10 or (ii) the Banks receive notice under Section 8.01(h) of any
event for which notice is required to be delivered for any such Real Property.
If the Borrower fails to provide the same within 90 days after such request was
made, the Agents may order the same, the cost of which shall be borne by the
Borrower, and the Borrower shall grant and hereby grants to the Agents and the
Banks and their agents access to such Real Property and specifically grants the
Agents and the Banks an irrevocable non-exclusive license, subject to the rights
of tenants, to undertake such an assessment at any reasonable time upon
reasonable notice to the Borrower, all at the sole and reasonable expense of the
Borrower.
8.07 ERISA. As soon as possible and, in any event, within fifteen
Business Days after the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate knows of the occurrence of any of the following, the Borrower will
deliver to each of the Banks a certificate of the Chief Financial Officer of the
Borrower setting forth the full details as to such occurrence and the action, if
any, that the Borrower, such Subsidiary or such ERISA Affiliate is required or
proposes to take, together with any notices required or proposed to be given to
or filed with or by the Borrower, the Subsidiary, the ERISA Affiliate, the PBGC,
a Plan participant or the Plan administrator with respect thereto: that a
Reportable Event has occurred; that an accumulated funding deficiency, within
the meaning of Section 412 of the Code or Section 302 of ERISA, has been
incurred or an application may be or has been made for a waiver or modification
of the minimum funding standard (including any required installment payments) or
an extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA with respect to a Plan or a Multiemployer Plan; that a
contribution for a material amount required to be made with respect to a Plan, a
Multiemployer Plan or a Foreign Pension Plan has not been timely made; that a
Plan or a Multiemployer Plan has been or may be terminated under Section 4041(c)
or 4042 of ERISA, reorganized, partitioned or declared insolvent under Title IV
of ERISA; that a Plan has an Unfunded Current Liability; that proceedings may be
or have been instituted to terminate or appoint a trustee to administer a Plan
or a Multiemployer Plan which is subject to Title IV of ERISA; that a proceeding
has been instituted pursuant to Section 515 of ERISA to collect a delinquent
contribution to a Multiemployer Plan; that the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate will or may incur any material liability
(including any indirect or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064 or 4069
of ERISA or with respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980
of the Code or Section 409 or 502(i) or 502(l) of ERISA or under Section
4980B(a) of the Code with respect to a group health plan (as defined in Section
607(1) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the
Code or with respect to a Multiemployer Plan under Sections 4201, 4204 or 4212
of ERISA; or that the Borrower or any Subsidiary of the Borrower may incur any
material liability pursuant to any employee welfare benefit plan (as defined in
Section 3(1) of ERISA) that provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA)
-53-
or any Plan which is subject to Title IV of ERISA, any Multiemployer Plan or any
Foreign Pension Plan. Upon written request of any Agent, the Borrower will
deliver to each of the Banks a complete copy of the annual report (on Internal
Revenue Service Form 5500-series) of each Plan (including, to the extent
required, the related financial and actuarial statements and opinions and other
supporting statements, certifications, schedules and information) required to be
filed with the Internal Revenue Service or any other material financial
information the Borrower or any Subsidiary has with respect to any Plan. In
addition to any certificates or notices delivered to the Banks pursuant to the
first sentence hereof, copies of any material notices pertaining to the
foregoing events received by the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate with respect to any Plan, Multiemployer Plan or Foreign Pension
Plan shall be delivered to the Banks no later than ten Business Days after the
date such notice has been received by the Borrower, the Subsidiary or the ERISA
Affiliate, as applicable.
8.08 End of Fiscal Years; Fiscal Quarters. The Borrower will cause (i)
each of its, and each of its Subsidiaries', fiscal years to end on September 30,
and (ii) each of its, and each of its Subsidiaries', fiscal quarters to end on
December 31, March 31, June 30 and September 30.
8.09 Performance of Obligations. The Borrower will, and will cause
each of its Subsidiaries to, perform all of its obligations under the terms of
each mortgage, indenture, security agreement, loan agreement or credit agreement
and each other material agreement, contract or instrument by which it is bound,
except such non-performances as could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole.
8.10 Payment of Taxes. The Borrower will pay and discharge, and will
cause each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits, or
upon any properties belonging to it, prior to the date on which penalties attach
thereto, and all lawful claims for sums that have become due and payable which,
if unpaid, might become a Lien not otherwise permitted under Section 9.01(i);
provided, that neither the Borrower nor any of its Subsidiaries shall be
required to pay any such tax, assessment, charge, levy or claim which is being
contested in good faith and by proper proceedings if it has maintained adequate
reserves with respect thereto in accordance with generally accepted accounting
principles.
8.11 Interest Rate Protection. Within 90 days following the
Initial Borrowing Date, the Borrower will enter into and thereafter maintain,
Interest Rate Protection Agreements acceptable to the Agents establishing a
fixed or maximum interest rate acceptable to the Agents for an aggregate amount
equal to at least 50% of the aggregate principal amount of all Term Loans then
outstanding.
-54-
8.12 Additional Security; Further Assurances. (a) The Borrower will,
and will cause each of the Subsidiary Guarantors to, grant to the Collateral
Agent security interests and mortgages in such assets and properties (including
Real Property) of the Borrower and such Subsidiary Guarantors which are of the
type required to be pledged or assigned pursuant to the original Security
Documents and as are not covered by such original Security Documents, and as may
be requested from time to time by the Agents or the Required Banks
(collectively, the "Additional Security Documents"). All such security interests
and mortgages shall be granted pursuant to documentation reasonably satisfactory
in form and substance to the Agents and shall constitute valid and enforceable
perfected security interests and mortgages superior to and prior to the rights
of all third Persons and subject to no other Liens except for Permitted Liens.
The Additional Security Documents or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Additional Security Documents and
all taxes, fees and other charges payable in connection therewith shall have
been paid in full.
(b) The Borrower will, and will cause each of the Subsidiary
Guarantors to, at the expense of the Borrower, make, execute, endorse,
acknowledge, file and/or deliver to the Collateral Agent from time to time such
vouchers, invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, real
property surveys, reports and other assurances or instruments and take such
further steps relating to the collateral covered by any of the Security
Documents as the Collateral Agent may reasonably require. Furthermore, the
Borrower will cause to be delivered to the Collateral Agent such opinions of
counsel, title insurance and other related documents as may be reasonably
requested by the Agents to assure itself that this Section 8.12 has been
complied with.
(c) The Borrower agrees that each action required above by this
Section 8.12 shall be completed within 90 days after such action is either
requested to be taken by the Agents or the Required Banks or required to be
taken by the Borrower and the Subsidiary Guarantors pursuant to the terms of
this Section 8.12.
8.13 Foreign Subsidiaries Security. If following a change in the
relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronouncements issued or promulgated thereunder, counsel for the
Borrower reasonably acceptable to the Agents does not within 30 days after a
request from the Agents or the Required Banks deliver evidence, in form and
substance mutually satisfactory to the Agents and the Borrower, with respect to
any Foreign Subsidiary of the Borrower which has not already had all of its
stock pledged pursuant to the Pledge Agreement that (i) a pledge of 66-2/3% or
more of the total combined voting power of all classes of capital stock of such
Foreign Subsidiary entitled to vote, (ii) the entering into by such Foreign
Subsidiary of a security agreement in substantially the form of the Security
Agreement and (iii) the entering into by such Foreign Subsidiary of a guaranty
in substantially the form of the Subsidiaries Guaranty, in any such case would
cause the undistributed earnings of such Foreign Subsidiary as determined for
Federal income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary's United States parent for Federal income tax
-55-
purposes, then in the case of a failure to deliver the evidence described in
clause (i) above, unless the Borrower determines in good faith and notifies the
Agents that such action will result in material negative tax implications to the
Borrower or any of its Subsidiaries, that portion of such Foreign Subsidiary's
outstanding capital stock not theretofore pledged pursuant to the Pledge
Agreement shall be pledged to the Collateral Agent for the benefit of the
Secured Creditors pursuant to the Pledge Agreement (or another pledge agreement
in substantially similar form, if needed), and in the case of a failure to
deliver the evidence described in clause (ii) above unless the Borrower
determines in good faith and notifies the Agents that such action will result in
material negative tax implications to the Borrower or any of its Subsidiaries,
such Foreign Subsidiary (to the extent that same is a Wholly-Owned Foreign
Subsidiary and would otherwise constitute a Subsidiary Guarantor) will execute
and deliver the Security Agreement (or another security agreement in
substantially similar form, if needed), granting the Collateral Agent for the
benefit of the Secured Creditors a security interest in all of such Foreign
Subsidiary's assets and securing the Obligations of the Borrower under the
Credit Documents and under any Interest Rate Protection Agreement or Other
Hedging Agreement and, in the event the Subsidiaries Guaranty shall have been
executed by such Foreign Subsidiary, the obligations of such Foreign Subsidiary
thereunder, and in the case of a failure to deliver the evidence described in
clause (iii) above unless the Borrower determines in good faith and notifies the
Agents that such action will result in material negative tax implications to the
Borrower or any of its Subsidiaries, such Foreign Subsidiary (to the extent that
same is a Wholly-Owned Foreign Subsidiary and would otherwise constitute a
Subsidiary Guarantor) will execute and deliver the Subsidiaries Guaranty (or
another guaranty in substantially similar form, if needed), guaranteeing the
Obligations of the Borrower under the Credit Documents and under any Interest
Rate Protection Agreement or Other Hedging Agreement, in each case to the extent
that the entering into such Security Agreement or Subsidiaries Guaranty is
permitted by the laws of the respective foreign jurisdiction and with all
documents delivered pursuant to this Section 8.13 to be in form and substance
reasonably satisfactory to the Agents.
8.14 Change of Name. Within 7 days of the Initial Borrowing Date, the
Borrower shall cause SKL to change its name to "Snorkel International, Inc."
SECTION 9. Negative Covenants. The Borrower hereby covenants and
agrees that on and after the Effective Date and until the Total Commitments and
all Letters of Credit have terminated and the Loans, Notes and Unpaid Drawings,
together with interest, Fees and all other Obligations incurred hereunder and
thereunder, are paid in full:
9.01 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
the Borrower or any of its Subsidiaries, whether now owned or hereafter
acquired, or sell any such property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable with recourse to the Borrower or any of
its Subsidiaries),
-56-
or assign any right to receive income or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute; provided that the provisions of this Section 9.01
shall not prevent the creation, incurrence, assumption or existence of the
following (Liens described below are herein referred to as "Permitted Liens"):
(i) inchoate Liens for taxes, assessments or governmental charges or
levies not yet due or Liens for taxes, assessments or governmental charges
or levies being contested in good faith and by appropriate proceedings for
which adequate reserves have been established in accordance with generally
accepted accounting principles;
(ii) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law, which were incurred in the ordinary course
of business and do not secure Indebtedness for borrowed money, such as
carriers', warehousemen's, materialmen's and mechanics' liens and other
similar Liens arising in the ordinary course of business, and which (x) do
not in the aggregate materially detract from the value of the Borrower's or
such Subsidiary's property or assets or materially impair the use thereof
in the operation of the business of the Borrower or such Subsidiary or
(y) are being contested in good faith by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the
property or assets subject to any such Lien;
(iii) Liens in existence on the Initial Borrowing Date which are
listed, and the property subject thereto described, in Schedule VIII,
without giving effect to any extensions or renewals thereof;
(iv) Permitted Encumbrances;
(v) Liens created pursuant to this Agreement and the Security
Documents;
(vi) Liens upon assets of the Borrower or any of its Subsidiaries
subject to Capitalized Lease Obligations to the extent such Capitalized
Lease Obligations are permitted by Section 9.04(iii), provided that (x)
such Liens only serve to secure the payment of Indebtedness arising under
such Capitalized Lease Obligation and (y) the Lien encumbering the asset
giving rise to the Capitalized Lease Obligation does not encumber any other
asset of the Borrower or any Subsidiary of the Borrower;
(vii) Liens placed upon equipment or machinery used in the ordinary
course of business of the Borrower or any of its Subsidiaries at the time
of acquisition thereof by the Borrower or any such Subsidiary to secure
Indebtedness incurred to pay all or a portion of the purchase price thereof
or to secure Indebtedness incurred solely for the purpose of financing the
acquisition of any such equipment or machinery or extensions, renewals or
replacements of any of the foregoing for the same or a lesser amount,
provided that (x) the aggregate outstanding principal amount of all
-57-
Indebtedness secured by Xxxxx permitted by this clause (vii), when added to
the amount outstanding under clause 9.04(iii), shall not at any time exceed
$5,000,000 and (y) in all events, the Lien encumbering the equipment or
machinery so acquired does not encumber any other asset of the Borrower or
such Subsidiary;
(viii) easements, rights-of-way, restrictions, encroachments and other
similar charges or encumbrances, and minor title deficiencies, in each case
not securing Indebtedness and not materially interfering with the conduct
of the business of the Borrower or any of its Subsidiaries;
(ix) Liens arising from precautionary UCC financing statement filings
regarding operating leases;
(x) Liens arising out of judgments, decrees or attachments not
constituting an Event of Default under Section 10.09, provided that no cash
or other property shall be pledged by the Borrower or any Subsidiary as
security therefor;
(xi) statutory and common law landlords' liens under leases to which
the Borrower or any of its Subsidiaries is a party;
(xii) Liens (other than Liens imposed under ERISA) incurred in the
ordinary course of business in connection with workers compensation claims,
unemployment insurance and social security benefits and Liens securing the
performance of bids, tenders, leases and contracts in the ordinary course
of business, statutory obligations, surety bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of
business (exclusive of obligations in respect of the payment for borrowed
money), provided that the aggregate value of all cash and property
encumbered by consensual Liens permitted pursuant to this clause (xii)
shall not at any time exceed $500,000;
(xiii) Liens on property or assets acquired pursuant to a Permitted
Acquisition, or on property or assets of a Subsidiary of the Borrower in
existence at the time such Subsidiary is acquired pursuant to a Permitted
Acquisition, provided that (x) any Indebtedness that is secured by such
Liens is permitted to exist under Section 9.04(vii) and (y) such Liens are
not incurred in connection with, or in contemplation or anticipation of,
such Permitted Acquisition and do not attach to any other asset of the
Borrower or any of its Subsidiaries;
In connection with the granting of Liens of the type described in clauses (vi),
(vii) and (xiii) of this Section 9.01 by the Borrower or any of its
Subsidiaries, the Administrative Agent and the Collateral Agent shall be
authorized to take any actions deemed appropriate by it in connection therewith
(including, without limitation, by executing appropriate lien releases or lien
subordination agreements in favor of the holder or holders of such Liens, in
either case solely with respect to the item or items of equipment or other
assets subject to such Liens).
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9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. The
Borrower will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of all or any part of
its property or assets, or enter into any sale-leaseback transactions, or
purchase or otherwise acquire (in one or a series of related transactions) any
part of the property or assets (other than purchases or other acquisitions of
inventory, materials and equipment in the ordinary course of business) of any
Person (or agree to do any of the foregoing at any future time), except that:
(i) Capital Expenditures by the Borrower and its Subsidiaries shall be
permitted to the extent permitted by Section 9.07;
(ii) each of the Borrower and its Subsidiaries may in the ordinary
course of business sell, lease or otherwise dispose of any equipment or
materials which, in the reasonable judgment of such Person, are obsolete,
unusable or worn out;
(iii) each of the Borrower and its Subsidiaries may sell assets (other
than the capital stock of any Subsidiary Guarantor), so long as (w) no
Default or Event of Default then exists or would result therefrom, (x) each
such sale is in an arms-length transaction and the Borrower or the
respective Subsidiary receives at least fair market value (as determined in
good faith by the Borrower or such Subsidiary, as the case may be), (y) at
least 80% of the total consideration received by the Borrower or such
Subsidiary is cash and paid at the time of the closing of such sale and (z)
the aggregate amount of the proceeds received from all assets sold pursuant
to this clause (iii) shall not exceed $250,000 in any fiscal year of the
Borrower;
(iv) each of the Borrower and its Subsidiaries may sell assets (other
than the capital stock of any Subsidiary Guarantor), so long as (v) no
Default or Event of Default then exists or would result therefrom, (w) each
such sale is in an arm's-length transaction and the Borrower or the
respective Subsidiary receives at least fair market value (as determined in
good faith by the Borrower or such Subsidiary, as the case may be), (x) at
least 80% of the total consideration received by the Borrower or such
Subsidiary is cash and is paid at the time of the closing of such sale, (y)
the Net Sale Proceeds therefrom are applied as (and to the extent) required
by Section 4.02(e) and (z) the aggregate amount of the proceeds received
from all assets sold pursuant to this clause (iv) shall not exceed
$10,000,000 in any fiscal year of the Borrower;
(v) Investments may be made to the extent permitted by Section 9.05;
(vi) each of the Borrower and its Subsidiaries may lease (as lessee)
real or personal property in the ordinary course of business (so long as
any such lease does not create a Capitalized Lease Obligation except to the
extent permitted by Section 9.04(iv));
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(vii) each of the Borrower and its Subsidiaries may make sales of
inventory in the ordinary course of business;
(viii) the Transaction (including the earn-out payment described in
Section 1.4(b) to the Asset Purchase Agreement) shall be permitted;
(ix) the Borrower and each of its Subsidiaries may acquire assets or
the capital stock of any Person, including by merger, so long as the
survivor of such merger is, or becomes at such time, a Subsidiary Guarantor
(any such acquisition, a "Permitted Acquisition" and the date of
consummation of any such acquisition, an "Acquisition Date"), provided that
(i) the sum of the aggregate cash and Cash Equivalents plus the aggregate
market value of all other consideration paid by the Borrower and its
Subsidiaries (including any Indebtedness assumed by the Borrower or any
Subsidiary) in connection with (x) any one such Permitted Acquisition shall
not exceed $40,000,000 and (y) all such Permitted Acquisitions shall not
exceed $60,000,000; (ii) no Default or Event of Default exists at the time
of such acquisition or will exist as a result thereof; (iii) in respect of
each Permitted Acquisition (or of all Permitted Acquisitions closing on the
same date), the Borrower shall have delivered to the Agents an officer's
certificate executed by an authorized officer of the Borrower demonstrating
that on a Pro Forma Basis determined as if such Permitted Acquisition (or
Acquisitions) had been consummated (and any Indebtedness to be incurred to
finance such Permitted Acquisition had been incurred) on the first day of
the last Test Period of the Borrower then last ended, the Borrower would
have been in compliance with Sections 9.08 through 9.10, inclusive, for
such Test Period; and (iv) the principal place of business of, and at least
80% of the assets of, each such Acquired Business shall be located in the
United States;
(x) the Borrower may transfer any assets to a Subsidiary Guarantor,
and any Subsidiary of the Borrower may merge or consolidate with and into,
or be liquidated into, or transfer any of its assets to, the Borrower or
any Subsidiary Guarantor, in each case, so long as (i) the Borrower or the
respective Subsidiary Guarantor is the surviving corporation of any such
transaction, (ii) in the case of any such transaction involving a
non-Wholly-Owned Subsidiary, the only consideration paid to third parties
in connection therewith are shares of common stock of the Borrower and
(iii) in the case of any transaction between or among the Borrower and the
Subsidiary Guarantors, all Liens granted pursuant to the Security Documents
on any property or assets involved shall remain in full force and effect
(with at least the same priority as such Lien would have had if such
transfer pursuant to this clause (x) had not occurred);
(xi) any Foreign Subsidiary of the Borrower may merge or consolidate
with and into, or be liquidated into, or transfer any of its assets to, the
Borrower or any Foreign Subsidiary so long as in the case of any such
merger or consolidation, the
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Borrower or any Foreign Subsidiary is the surviving corporation of any such
transaction; and
(xii) each of the Borrower and its Subsidiaries may sell Cash
Equivalents permitted to be held by them pursuant to Section 9.05(ii) so
long as each such sale is for cash and at fair market value (as determined
in good faith by the Borrower or such Subsidiary, as the case may be).
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale of any Collateral, or any Collateral is sold as permitted by
this Section 9.02 (other than to the Borrower or a Subsidiary thereof), such
Collateral shall be sold free and clear of the Liens created by the Security
Documents, and the Administrative Agent and the Collateral Agent shall be
authorized to take any actions deemed appropriate in order to effect the
foregoing.
9.03 Dividends. The Borrower will not, and will not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to the
Borrower or any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may pay cash Dividends to the
Borrower or any Subsidiary Guarantor;
(ii) so long as there shall exist no Default or Event of Default (both
before and after giving effect to the payment thereof), the Borrower may
repurchase outstanding shares of its common stock (or options to purchase such
common stock) following the death, disability or termination of employment of
employees of the Borrower or any of its Subsidiaries, provided that the
aggregate amount of Dividends paid by the Borrower pursuant to this clause (ii)
shall not exceed $250,000 in any fiscal year of the Borrower; and
(iii) so long as there shall be no Default or Event of Default (both
before and after giving effect to the payment thereof), the Borrower may pay
cash Dividends to its shareholders in an amount not to exceed in the aggregate
for all such Dividends, the then applicable Cumulative Net Income Amount.
9.04 Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(ii) Existing Indebtedness outstanding on the Initial Borrowing Date
and listed on Schedule VI, without giving effect to any subsequent
extension, renewal or refinancing thereof;
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(iii) Indebtedness of the Borrower and its Subsidiaries evidenced by
Capitalized Lease Obligations to the extent permitted pursuant to Section
9.07, provided that in no event shall the aggregate principal amount of
Capitalized Lease Obligations permitted by this clause (iii), when added to
the amount outstanding under clause 9.01(vii), exceed $5,000,000 at any
time outstanding;
(iv) Indebtedness subject to Liens permitted under Section 9.01(vii);
(v) intercompany Indebtedness to the extent permitted by
Sections 9.05;
(vi) a single issuance of one or more tranches of unsecured
subordinated Indebtedness of the Borrower (the "New Subordinated Notes"),
so long as (i) the aggregate outstanding principal amount thereof does not
exceed $100,000,000 (less any repayments of principal thereof), (ii) at
least 10 Business Days prior to the issuance thereof, the Borrower shall
have delivered to the Agents and each of the Banks substantially final
drafts of the documents pursuant to which the New Subordinated Notes are to
be issued and with any changes thereto made after the initial delivery of
such documents to be delivered to the Agents and with any significant
changes thereto made after such initial delivery to be delivered to each of
the Banks at least three days prior to the issuance of such New
Subordinated Notes, (iii) the final maturity date thereof is at least one
year beyond the Term Loan Maturity Date, (iv) there are no required
amortization, mandatory redemption or sinking fund or similar provisions
prior to the date which is one year after the Term Loan Maturity Date, (v)
all other terms and conditions thereof (including, without limitation,
interest rates, covenants, defaults, remedies and subordination provisions)
are reasonably satisfactory to the Agents, (vi) no Default or Event of
Default then exists or would result therefrom and (vii) the Net Debt
Proceeds from such New Subordinated Notes shall be applied to repay Term
Loans to the extent outstanding at the time of such issuance (or, if prior
to the termination of the Term Loan Commitment, to reduce the Total Term
Loan Commitment) with any remaining amount of such Net Debt Proceeds to be
applied to reduce any outstanding Revolving Loans (with no reduction in the
respective commitments thereunder); and
(vii) Indebtedness assumed by the Borrower or any Subsidiary in
connection with a Permitted Acquisition, provided that (x) such
Indebtedness was not incurred in connection with or in contemplation of
such Permitted Acquisition and (y) such Indebtedness does not exceed 20% of
the aggregate consideration paid by the Borrower and/or its Subsidiaries in
connection with such Permitted Acquisition;
(viii) Indebtedness of the Borrower and its Subsidiaries consisting of
guaranty and repurchase obligations entered into in the ordinary course of
business in connection with their dealer floor plan and rental fleet
financing arrangements; and
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(ix) additional unsecured Indebtedness of the Borrower and its
Subsidiaries not to exceed $7,500,000 in aggregate principal amount at any
time outstanding.
9.05 Advances, Investments and Loans. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, lend money or
credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents (each of the foregoing an "Investment" and,
collectively, "Investments"), except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold accounts
receivables owing to any of them, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary terms, and the Borrower and its Subsidiaries may own Investments
received in connection with the bankruptcy or reorganization of suppliers
and customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course of
business;
(ii) the Borrower and its Subsidiaries may acquire and hold or invest
in cash and Cash Equivalents;
(iii) the Borrower and its Subsidiaries may hold the Investments held
by them on the Initial Borrowing Date and described on Schedule IX,
provided that any additional Investments made with respect thereto shall be
permitted only if independently permitted under the other provisions of
this Section 9.05;
(iv) the Borrower and its Subsidiaries may make loans and advances in
the ordinary course of business to their respective employees so long as
the aggregate principal amount thereof at any time outstanding (determined
without regard to any write-downs or write-offs of such loans and advances)
shall not exceed $1,000,000;
(v) the Borrower may enter into Interest Protection Agreements in
respect of the Obligations;
(vi) the Borrower and the Subsidiary Guarantors may make intercompany
loans and advances between or among one another (collectively,
"Intercompany Loans"), so long as each Intercompany Loan shall be evidenced
by an Intercompany Note that is pledged to the Collateral Agent pursuant to
the Pledge Agreement;
(vii) the Borrower and its Subsidiaries may hold promissory notes
issued by a purchaser in connection with an asset sale permitted under
Section 9.02(iii) and (iv);
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(viii) the Borrower and the Subsidiary Guarantors may make Investments
in addition to the loans and advances described in Section 9.05(vi) between
or among one another;
(ix) the Borrower and its Subsidiaries may make Permitted Acquisitions
effected in accordance with the requirements of Section 9.02(ix); and
(x) the Borrower and its Subsidiaries may make Investments in addition
to the Investments described above in this Section 9.05 not to exceed
$2,000,000 in aggregate amount at any time outstanding.
9.06 Transactions with Affiliates. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any transaction or series of
related transactions, whether or not in the ordinary course of business, with
any Affiliate of the Borrower or any of its Subsidiaries, other than in the
ordinary course of business and on terms and conditions substantially as
favorable to the Borrower or such Subsidiary as would reasonably be obtained by
the Borrower or such Subsidiary at that time in a comparable arm's-length
transaction with a Person other than an Affiliate, except that the following in
any event shall be permitted: (i) Dividends may be paid to the extent provided
in Section 9.03, (ii) loans may be made and other transactions may be entered
into by the Borrower and its Subsidiaries to the extent permitted by Sections
9.02, 9.04, 9.05 and 9.07, (iii) customary fees may be paid to non-officer
directors of the Borrower and (iv) the Borrower and its Subsidiaries may pay
management, advisory, consulting and similar fees to the Borrower, any
Wholly-Owned Subsidiary of the Borrower and Harbor Group Industries, Inc. and
its Affiliates.
9.07 Capital Expenditures. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any fiscal year of the Borrower beginning on or after October 1, 1997
(taken as one accounting period), the Borrower and its Subsidiaries may make
Capital Expenditures so long as the aggregate amount of such Capital
Expenditures does not exceed $15,000,000 for any such fiscal year, provided that
any such amount not utilized in any fiscal year may be applied to Capital
Expenditures in the next succeeding fiscal year, provided further that any
amounts so carried forward shall not be considered in the determination of
amounts available to be carried forward to any succeeding year.
(b) Notwithstanding the foregoing, the Borrower and its Subsidiaries
may make additional Capital Expenditures (which Capital Expenditures will not be
included in any determination under Section 9.07(a)) with the Net Sale Proceeds
of Asset Sales to the extent such proceeds are not required to be applied to
repay Term Loans (or reduce the Total Revolving Loan Commitment) pursuant to
Section 4.02(d) and such proceeds are reinvested as required by Section 4.02(d).
(c) Notwithstanding the foregoing, the Borrower and its Subsidiaries
may make additional Capital Expenditures (which Capital Expenditures will not be
included in any
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determination under Section 9.07(a)) with the insurance proceeds received by the
Borrower or any of its Subsidiaries from any Recovery Event so long as such
Capital Expenditures are to replace or restore any properties or assets in
respect of which such proceeds were paid or contractually committed to be paid
within 180 days following the date of the receipt of such insurance proceeds to
the extent such insurance proceeds are not required to be applied to repay Term
Loans (or reduce the Total Revolving Loan Commitment) pursuant to Section
4.02(f).
(d) Notwithstanding the foregoing, the Borrower may make additional
Capital Expenditures (which Capital Expenditures will not be included in any
determination under Section 9.07(a)) constituting Permitted Acquisitions
effected in accordance with the requirements of Section 9.02(viii).
9.08 Consolidated Fixed Charge Coverage Ratio. The Borrower will not
permit the Consolidated Fixed Charge Coverage Ratio for the Test Period ending
on December 31, 1997 and for each Test Period ending thereafter to be less than
1.20:1:00.
9.09 Consolidated Interest Coverage Ratio. The Borrower will not
permit the Consolidated Interest Coverage Ratio for any Test Period ending on
the last day of a fiscal quarter set forth below to be less than the ratio set
forth opposite such fiscal quarter below:
Fiscal Quarter Ratio
March 31, 1998 4.00:1.00
June 30, 1998 4.00:1.00
September 30, 1998 5.00:1.00
December 31, 1998 5.00:1.00
March 31, 1999 5.00:1.00
June 30, 1999 5.00:1.00
September 30, 1999 5.50:1.00
Thereafter 5.50:1.00
9.10 Maximum Leverage Ratio. The Borrower will not permit the Leverage
Ratio at any time during a period set forth below to be greater than the ratio
set forth opposite such period below:
Fiscal Quarter Ratio
March 31, 1998 2.75:1.00
June 30, 1998 2.75:1.00
September 30, 1998 2.50:1.00
December 31, 1998 2.50:1.00
March 31, 1999 2.50:1.00
June 30, 1999 2.50:1.00
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Fiscal Quarter Ratio
September 30, 1999 2.25:1.00
December 31, 1999 2.25:1.00
March 31, 2000 2.25:1.00
June 30, 2000 2.25:1.00
September 30, 2000 2.00:1.00
December 31, 2000 2.00:1.00
March 31, 2001 1.75:1.00
Thereafter 1.75:1.00
9.11 Limitation on Voluntary Payments and Modifications of
Subordinated Limitation on Voluntary Payments and Modifications of Subordinated
Indebtedness; Modifications of Certificate of Incorporation and Certain Other
Agreements; etc. The Borrower will not, and will not permit any of its
Subsidiaries to, (i) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption or acquisition for value of, or
make any prepayment or redemption as a result of any asset sale, change of
control or similar event of (including, in each case, without limitation, by way
of depositing with the trustee with respect thereto or any other Person, money
or securities before due for the purpose of paying when due) any New
Subordinated Notes (after the issuance thereof), (ii) amend or modify, or permit
the amendment or modification of, any provision of the New Subordinated Notes or
any New Subordinated Note Documents, in each case after the issuance of the New
Subordinated Notes, (iii) amend, modify or change its certificate of
incorporation (including, without limitation, by the filing or modification of
any certificate of designation) (or the equivalent organizational documents) or
any agreement entered into by it with respect to its capital stock (including
any Shareholders' Agreement), or enter into any new agreement with respect to
its capital stock, unless such amendment, modification, change or other action
contemplated by this clause (iii) could not reasonably be expected to be adverse
to the interests of the Banks in any material respect, provided that SKL may in
any case amend its certificate of incorporation to the extent necessary to
comply with Section 8.14, and (iv) amend, modify or change any provision of any
Tax Sharing Agreement or enter into any new tax sharing agreement, tax
allocation agreement or similar agreement, unless such amendment, modification,
change or other action contemplated by this clause (iv) cannot reasonably be
expected to be adverse to the interests of the Banks in any material respect.
9.12 Limitation on Certain Restrictions on Subsidiaries. The Borrower
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any Subsidiary
the Borrower, or pay any Indebtedness owed to the Borrower or any Subsidiary of
the Borrower, (b) make loans or advances to the Borrower or any Subsidiary of
the Borrower or (c) transfer any of its properties or assets to the Borrower or
any Subsidiary of the Borrower, except for
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such encumbrances or restrictions existing under or by reason of (i) applicable
law, (ii) this Agreement and the other Credit Documents and (iii) restrictions
on the transfer of any asset subject to a Lien permitted by this Agreement.
9.13 Limitation on Issuance of Capital Stock. (a) The Borrower will
not, and will not permit any of its Subsidiaries to, issue (i) any preferred
stock or (ii) any common stock redeemable at the option of the holder thereof.
(b) The Borrower will not permit any of its Subsidiaries to issue any
capital stock (including by way of sales of treasury stock) or any options or
warrants to purchase, or securities convertible into, capital stock, except (i)
for transfers and replacements of then outstanding shares of capital stock, (ii)
for stock splits, stock dividends and issuances which do not decrease the
percentage ownership of the Borrower or any of its Subsidiaries in any class of
the capital stock of such Subsidiary, (iii) to qualify directors to the extent
required by applicable law and (iv) for issuances by newly created or acquired
Subsidiaries in accordance with the terms of this Agreement.
9.14 Business. The Borrower will not, and will not permit any of its
Subsidiaries to, engage (directly or indirectly) in any business other than the
businesses in which the Borrower and its Subsidiaries are engaged on the Initial
Borrowing Date (after giving effect to the Transaction) and reasonable
extensions thereof and those reasonably related or complementary thereto.
9.15 Limitation on Creation of Subsidiaries. Notwithstanding anything
to the contrary contained in this Agreement, the Borrower will not, and will not
permit any of its Subsidiaries to, establish, create or acquire after the
Effective Date any Subsidiary; provided that, the (A) Borrower and its
Wholly-Owned Subsidiaries shall be permitted to establish or create Wholly-Owned
Subsidiaries so long as, in each case, (i) at least 15 days' prior written
notice thereof is given to the Agents (or such shorter period of time as is
acceptable to the Agents), (ii) the capital stock of such new Subsidiary (or 65%
of the outstanding capital stock of a Foreign Subsidiary) is promptly pledged
pursuant to, and to the extent required by, this Agreement and the Pledge
Agreement and the certificates, if any, representing such stock, together with
stock powers duly executed in blank, are delivered to the Collateral Agent,
(iii) such new Subsidiary (other than a Foreign Subsidiary except to the extent
otherwise required pursuant to Section 8.13) promptly executes a counterpart of
the Subsidiaries Guaranty, the Pledge Agreement and the Security Agreement, and
(iv) to the extent requested by the Agents or the Required Banks, takes all
actions required pursuant to Section 8.12 and (B) Subsidiaries may be acquired
pursuant to Permitted Acquisitions so long as, in each such case the actions
specified in preceding clause (A) shall be taken. In addition, each new
Subsidiary that is required to execute any Credit Document shall execute and
deliver, or cause to be executed and delivered, all other relevant documentation
of the type described in Section 5 as such new Subsidiary would have had to
deliver if such new Subsidiary were a Credit Party on the Initial Borrowing
Date.
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SECTION 10. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the payment when due
of any principal of any Loan or any Note, or (ii) default, and such default
shall continue for more than two Business Days, in the payment when due of any
interest on any Loan or Note, any Unpaid Drawing or any Fees or any other
amounts owing hereunder or thereunder; or
10.02 Representations, etc. Any representation, warranty or statement
made by any Credit Party herein or in any other Credit Document or in any
certificate delivered to any Agent or any Bank pursuant hereto or thereto shall
prove to be untrue in any material respect on the date as of which made or
deemed made; or
10.03 Covenants. Any Credit Party shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 8.01(f)(i), 8.08 or 8.11 or Section 9 or (ii) default in the due
performance or observance by it of any other term, covenant or agreement
contained in this Agreement or any other Credit Document (other than those set
forth in Sections 10.01 and 10.02) and such default shall continue unremedied
for a period of 30 days after written notice thereof to the defaulting party by
any Agent or the Required Banks; or
10.04 Default Under Other Agreements. (i) The Borrower or any of its
Subsidiaries shall (x) default in any payment of any Indebtedness (other than
the Notes) beyond the period of grace or cure, if any, provided in the
instrument or agreement under which such Indebtedness was created or (y) default
in the observance or performance of any agreement or condition relating to any
Indebtedness (other than the Notes) or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause (determined without regard
to whether any notice is required, but beyond the period of grace or cure, if
any, provided in the instrument or agreement under which such Indebtedness was
created), any such Indebtedness to become due prior to its stated maturity, or
(ii) any Indebtedness (other than the Notes) of the Borrower or any of its
Subsidiaries shall be declared to be (or shall become) due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment,
prior to the stated maturity thereof, provided that it shall not be a Default or
an Event of Default under this Section 10.04 unless the aggregate principal
amount of all Indebtedness as described in preceding clauses (i) and (ii) is at
least $2,000,000; or
10.05 Bankruptcy, etc. The Borrower or any of its Subsidiaries shall
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bankruptcy Code"); or an involuntary case is commenced against the
Borrower or any of its Subsidiaries, and the
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petition is not controverted within 15 days, or is not dismissed within 60 days,
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of the Borrower or any of its Subsidiaries, or the Borrower or any of
its Subsidiaries commences any other proceeding under any reorganization,
arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to the Borrower or any of its Subsidiaries, or there is
commenced against the Borrower or any of its Subsidiaries any such proceeding
which remains undismissed for a period of 60 days, or the Borrower or any of its
Subsidiaries is adjudicated insolvent or bankrupt; or any order of relief or
other order approving any such case or proceeding is entered; or the Borrower or
any of its Subsidiaries suffers any appointment of any custodian or the like for
it or any substantial part of its property to continue undischarged or unstayed
for a period of 60 days; or the Borrower or any of its Subsidiaries makes a
general assignment for the benefit of creditors; or any corporate action is
taken by the Borrower or any of its Subsidiaries for the purpose of effecting
any of the foregoing; or
10.06 ERISA . (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof under Section 412 of the
Code or Section 302 of ERISA or a waiver of such standard or extension of any
amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, a Reportable Event shall have occurred, any Plan or
Multiemployer Plan which is subject to Title IV of ERISA shall have had or is
likely to have a trustee appointed to administer such Plan or Multiemployer
Plan, any Plan or Multiemployer Plan which is subject to Title IV of ERISA is,
shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan or Multiemployer Plan shall have
an Unfunded Current Liability, a contribution required to be made with respect
to a Plan, a Multiemployer Plan or a Foreign Pension Plan has not been timely
made, the Borrower or any Subsidiary of the Borrower or any ERISA Affiliate has
incurred or is likely to incur any liability to or on account of a Plan or
Multiemployer Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the
Code or on account of a group health plan (as defined in Section 607(1) of ERISA
or Section 4980B(g)(2) of the Code) under Section 4980B(a) of the Code, or the
Borrower or any Subsidiary of the Borrower has incurred or is likely to incur
liabilities pursuant to one or more employee welfare benefit plans (as defined
in Section 3(1) of ERISA) that provide benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or Plans or
Foreign Pension Plans; (b) there shall result from any such event or events the
imposition of a lien, the granting of a security interest, or a liability or a
material risk of incurring a liability; and (c) such lien, security interest or
liability, individually, and/or in the aggregate, has had, or could reasonably
be expected to have, a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower or the Borrower and its Subsidiaries taken as a whole; or
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10.07 Security Documents. At any time after the execution and delivery
thereof, any of the Security Documents shall cease to be in full force and
effect, or shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported to be
created thereby (including, without limitation, a perfected security interest
in, and Lien on, all of the Collateral, in favor of the Collateral Agent,
superior to and prior to the rights of all third Persons (except as permitted by
Section 9.01), and subject to no other Liens (except as permitted by Section
9.01); or
10.08 Subsidiaries Guaranty. At any time after the execution and
delivery thereof, the Subsidiaries Guaranty or any provision thereof shall cease
to be in full force or effect as to any Subsidiary Guarantor, or any Subsidiary
Guarantor or any Person acting by or on behalf of such Subsidiary Guarantor
shall deny or disaffirm such Subsidiary Guarantor's obligations under the
Subsidiaries Guaranty or any Subsidiary Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to the Subsidiaries Guaranty; or
10.09 Judgments. One or more judgments or decrees shall be entered
against the Borrower or any Subsidiary of the Borrower involving in the
aggregate for the Borrower and its Subsidiaries a liability (not paid or fully
covered by a reputable and solvent insurance company) and such judgments and
decrees either shall be final and non-appealable or shall not be vacated,
discharged or stayed or bonded pending appeal for any period of 30 consecutive
days, and the aggregate amount of all such judgments exceeds $2,000,000; or
10.10 Change of Control. A Change of Control shall occur:
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Banks, shall by written notice to the Borrower, take any or all of
the following actions, without prejudice to the rights of any Agent, any Bank or
the holder of any Note to enforce its claims against any Credit Party (provided,
that, if an Event of Default specified in Section 10.05 shall occur with respect
to the Borrower, the result which would occur upon the giving of written notice
by the Administrative Agent as specified in clauses (i) and (ii) below shall
occur automatically without the giving of any such notice): (i) declare the
Total Commitments terminated, whereupon all Commitments of each Bank shall
forthwith terminate immediately and any Commitment Commission shall forthwith
become due and payable without any other notice of any kind; (ii) declare the
principal of and any accrued interest in respect of all Loans and the Notes and
all Obligations owing hereunder and thereunder to be, whereupon the same shall
become, forthwith due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by each Credit Party; (iii)
terminate any Letter of Credit which may be terminated in accordance with its
terms; (iv) direct the Borrower to pay (and the Borrower agrees that upon
receipt of such notice, or upon the occurrence of an Event of Default specified
in Section 10.05 with respect to the Borrower, it will pay) to the Collateral
Agent at the Payment Office such additional amount of cash, to be held as
security by the Collateral
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Agent, as is equal to the aggregate Stated Amount of all Letters of Credit
issued for the account of the Borrower and then outstanding; (v) enforce, as
Collateral Agent, all of the Liens and security interests created pursuant to
the Security Documents; and (vi) apply any cash collateral held by the
Administrative Agent pursuant to Section 4.02 to the repayment of the
Obligations.
SECTION 11. Definitions and Accounting Terms.
11.01 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):
"A Term Note" shall have the meaning provided in Section 1.05(a).
"Acquired Business" shall mean the assets acquired pursuant to the
Acquisition Documents.
"Acquisition" shall mean the purchase by SKL, a Wholly-Owned
Subsidiary of the Borrower, of the Acquired Business pursuant to the Acquisition
Documents.
"Acquisition Date" shall have the meaning provided in Section
9.02(ix).
"Acquisition Documents" shall mean the Asset Purchase Agreement and
all other agreements and documents entered into in connection with the
Acquisition.
"Additional Security Documents" shall have the meaning provided in
Section 8.12.
"Adjusted Consolidated Cash Income" shall mean, for any period,
Consolidated Net Income for such period plus, without duplication, the sum of
the amount of all net non-cash charges (including, without limitation,
depreciation, amortization, deferred tax expense, non-cash interest expense) and
net non-cash losses which were included in arriving at Consolidated Net Income
for such period less the sum of the amount of all net non-cash gains which were
included in arriving at Consolidated Net Income for such period.
"Adjusted Consolidated Working Capital" at any time shall mean
Consolidated Current Assets (but excluding therefrom all cash and Cash
Equivalents) less Consolidated Current Liabilities at such time.
"Adjusted RL Percentage" shall mean (x) at a time when no Bank Default
exists, for each Bank, such Bank's RL Percentage and (y) at a time when a Bank
Default exists, (i) for each Bank that is a Defaulting Bank, zero and (ii) for
each Bank that is a Non-Defaulting Bank, the percentage determined by dividing
such Bank's Revolving Loan
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Commitment at such time by the Adjusted Total Revolving Loan Commitment at such
time, it being understood that all references herein to Revolving Loan
Commitments and the Adjusted Total Revolving Loan Commitment at a time when the
Total Revolving Loan Commitment or Adjusted Total Revolving Loan Commitment, as
the case may be, has been terminated shall be references to the Revolving Loan
Commitments or Adjusted Total Revolving Loan Commitment, as the case may be, in
effect immediately prior to such termination, provided that (A) a Bank's
Adjusted RL Percentage shall only change upon the occurrence of a Bank Default
from that in effect immediately prior to such Bank Default to the extent that
after giving effect to such Bank Default, and any repayment of Revolving Loans
and Swingline Loans at such time pursuant to Section 4.02(a) or otherwise, the
sum of (i) the aggregate outstanding principal amount of Revolving Loans of such
Bank plus (ii) such Bank's new Adjusted RL Percentage of the aggregate
outstanding principal amount of Swingline Loans and the Letter of Credit
Outstandings, would not exceed the Revolving Loan Commitment of such Bank at
such time; (B) the changes to the Adjusted RL Percentage that would have become
effective upon the occurrence of a Bank Default but that did not become
effective as a result of the preceding clause (A) shall become effective on the
first date after the occurrence of the relevant Bank Default on which the sum of
(i) the aggregate outstanding principal amount of the Revolving Loans of all
Non-Defaulting Banks, plus (ii) the aggregate outstanding principal amount of
Swingline Loans, plus (iii) the Letter of Credit Outstandings, is equal to or
less than the Adjusted Total Revolving Loan Commitment; and (C) if (i) a
Non-Defaulting Bank's Adjusted RL Percentage is changed pursuant to the
preceding clause (B) and (ii) any repayment of such Bank's Revolving Loans or of
Unpaid Drawings or of Swingline Loans that were made during the period
commencing after the date of the relevant Bank Default and ending on the date of
such change to its Adjusted RL Percentage must be returned to the Borrower as a
preferential or similar payment in any bankruptcy or similar proceeding of the
Borrower, then the change to such Non-Defaulting Bank's Adjusted RL Percentage
effected pursuant to said clause (B) shall be reduced to that positive change,
if any, as would have been made to its Adjusted RL Percentage if (x) such
repayments had not been made and (y) the maximum change to its Adjusted RL
Percentage would have resulted in the sum of the outstanding principal of
Revolving Loans made by such Bank plus such Bank's new Adjusted RL Percentage of
the outstanding principal amount of Swingline Loans and of Letter of Credit
Outstandings equalling such Bank's Revolving Loan Commitment at such time.
"Adjusted Total Revolving Loan Commitment" shall mean at any time the
Total Revolving Loan Commitment less the aggregate Revolving Loan Commitments of
all Defaulting Banks.
"Administrative Agent" shall mean First Union National Bank, in its
capacity as Administrative Agent for the Banks hereunder, and shall include any
successor to the Administrative Agent appointed pursuant to Section 12.09.
"Affected Eurodollar Loans" shall have the meaning provided in Section
4.02(g).
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"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if such Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such other Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" shall mean and include the Administrative Agent and the
Syndication Agent.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented, amended, restated (including any amendment and restatement
hereof), extended, renewed, refinanced or replaced from time to time.
"Applicable Base Rate Margin" (i) for any calculation of interest
payable in respect of the period from and including the Initial Borrowing Date
to but excluding the first Start Date (as defined below) to occur after the
Initial Borrowing Date, shall mean 0.00%, and (ii) from and after the first day
of any Applicable Pricing Period (the "Start Date") (commencing with the first
Start Date to occur after the Initial Borrowing Date) to and including the last
day of such Applicable Pricing Period (the "End Date"), shall mean the
respective percentage per annum set forth in clause (A) or (B) below if, but
only if, as of the last day of the most recent fiscal quarter of the Borrower
ended immediately prior to such Start Date (the "Test Date") the condition in
clause (A) or (B) below is met:
(A) 0.125% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be greater
than 2.50:1.0; or
(B) 0% if, but only if, as of the Test Date for such Start Date, the
Leverage Ratio for the Test Period ended on such Test Date shall be equal to or
less than 2.50:1.0.
Notwithstanding anything to the contrary contained above in this definition, (a)
the Applicable Base Rate Margin shall be 0.125% at all times when financial
statements have not been delivered when required pursuant to Section 8.01(a) or
(b), as the case may be, and (b) on and after the date on which the Borrower has
issued New Subordinated Notes in an aggregate principal amount of at least
$100,000,000, each of the percentage margins set forth above shall be reduced by
0.125% (but not below 0%).
"Applicable Commitment Commission Percentage" (i) for any calculation
of the Commitment Commission payable in respect of the period from and including
the Effective Date to but excluding the first Start Date to occur after the
Effective Date, shall mean 0.375%, and (ii) after any Start Date (commencing
with the first Start Date to occur after the Initial Borrowing Date) to and
including the corresponding End Date, shall mean the
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respective percentage per annum set forth in clause (A) or (B) below if, but
only if, as of the Test Date for such Start Date the condition set forth in
clause (A) or (B) below is met:
(A) 0.375% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
greater than 2.00:1.00; or
(B) 0.250% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 2.00:1.00.
Notwithstanding anything to the contrary contained above in this definition, the
Applicable Commitment Commission Percentage shall be 0.375% at all times when
financial statements have not been delivered when required pursuant to Section
8.01(a) or (b), as the case may be.
"Applicable Eurodollar Margin" (i) for any calculation of interest
payable in respect of the period from and including the Initial Borrowing Date
to but excluding the first Start Date to occur after the Initial Borrowing Date,
shall mean 1.00%, and (ii) from and after any Start Date (commencing with the
first Start Date to occur after the Initial Borrowing Date) to and including the
corresponding End Date, shall mean the respective percentage per annum set forth
in clause (A)-(F) below if, but only if, as of the Test Date for such Start Date
the condition in clause (A)-(F) below is met:
(A) 1.125% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
greater than 2.5:1.0; or
(B) 1.000% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 2.50:1.0 but greater than 2.25:1.0; or
(C) 0.875% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 2.25:1.0 but greater than 2.00:1.0; or
(D) 0.750% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 2.00:1.0 but greater than 1.75:1.0; or
(E) 0.625% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 1.75:1.0 but greater than 1.50:1.0; or
(F) 0.500% if, but only if, as of the Test Date for such Start Date,
the Leverage Ratio for the Test Period ended on such Test Date shall be
equal to or less than 1.5:1.0.
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Notwithstanding anything to the contrary contained above in this definition, (a)
the Applicable Eurodollar Margin shall be 1.125% at all times when financial
statements have not been delivered when required pursuant to Section 8.01(a) or
(b), as the case may be, and (b) on and after the date on which the Borrower has
issued New Subordinated Notes in an aggregate principal amount of at least
$100,000,000, each of the percentage margins set forth above shall be reduced by
0.125%.
"Applicable Pricing Period" shall mean each period which shall
commence on a date five Business Days after the date on which the financial
statements are delivered pursuant to Section 8.01(a) or (b) and which shall end
on the earlier of (i) the date five Business Days after the date of actual
delivery of the next financial statements pursuant to Section 8.01(a) or (b) and
(ii) the latest date on which the next financial statements are required to be
delivered pursuant to Section 8.01(a) or (b) if such financial statements have
not been delivered on or prior to such date.
"Asset Purchase Agreement" shall mean the Asset Purchase Agreement
dated as of July 19, 1997, by and among Xxxxxx, various Subsidiaries of Figgie
and SKL and the amendment thereto dated as of November 9, 1997.
"Asset Sale" shall mean any sale, transfer or other disposition by the
Borrower or any of its Subsidiaries to any Person (including by way of
redemption by such Person) other than to the Borrower or a Wholly-Owned
Subsidiary of the Borrower of any asset (including, without limitation, any
capital stock or other securities of, or equity interests in, another Person) of
the Borrower or any of its Subsidiaries, other than any sale, transfer or
disposition permitted by Sections 9.02(ii), (iii), (v), (vii), (xi) and (xii).
"Assignment and Assumption Agreement" shall mean an Assignment and
Assumption Agreement substantially in the form of Exhibit K (appropriately
completed).
"B Term Note" shall have the meaning provided in Section 1.05(a).
"Bank" shall mean each Person listed on Schedule I, as well as any
Person which becomes a "Bank" hereunder pursuant to Section 1.13 or 13.04(b).
"Bank Default" shall mean (i) the refusal (which has not been
retracted) or the failure of a Bank to make available its portion of any
Borrowing (including any Mandatory Borrowing) or to fund its portion of any
unreimbursed payment under Section 2.04(c) or (ii) a Bank having notified in
writing the Borrower and/or the Administrative Agent that such Bank does not
intend to comply with its obligations under Section 1.01(a), 1.01(b), 1.01(c),
1.04 or 2, in the case of either clause (i) or (ii) as a result of any takeover
or control (including, without limitation, as a result of the occurrence of any
event of the type described in Section 10.05 with respect to such Bank) of such
Bank by any regulatory authority or agency.
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"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" at any time shall mean the higher of (i) 1/2 of 1% in
excess of the Federal Funds Rate and (ii) the Prime Lending Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii) each
other Loan designated or deemed designated as such by the Borrower at the time
of the incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrower's Account" shall mean a deposit account of the Borrower
maintained with the Payment Office of the Administrative Agent, which is
identified by the Borrower in the most recent Notice of Account Designation,
substantially in the form of Exhibit M hereto delivered by the Borrower to the
Administrative Agent as the Borrower's Account for receipt of proceeds of Loans
to the Borrower.
"Borrowing" shall mean the borrowing of one Type of Loan of a single
Tranche from all the Banks having Commitments of the respective Tranche (or from
the Swingline Bank in the case of Swingline Loans) on a given date (or resulting
from a conversion or conversions on such date) having in the case of Eurodollar
Loans the same Interest Period, provided that Base Rate Loans incurred pursuant
to Section 1.10(b) shall be considered part of the related Borrowing of
Eurodollar Loans.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York City, New York or Charlotte, North Carolina a legal holiday or a day
on which banking institutions are authorized or required by law or other
government action to close and (ii) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
Eurodollar Loans, any day which is a Business Day described in clause (i) above
and which is also a day for trading by and between banks in the London interbank
Eurodollar market.
"Calculation Period" shall mean the period of four consecutive fiscal
quarters of the Borrower last ended before the date of the respective Permitted
Acquisition which requires calculations to be made on a Pro Forma Basis.
"Capital Expenditures" shall mean, with respect to any Person, all
expenditures by such Person which should be capitalized in accordance with
generally accepted accounting principles and, without duplication, the amount of
Capitalized Lease Obligations incurred by such Person.
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"Capitalized Lease Obligations" of any Person shall mean all rental
obligations which, under generally accepted accounting principles, are or will
be required to be capitalized on the books of such Person, in each case taken at
the amount thereof accounted for as indebtedness in accordance with such
principles.
"Cash Equivalents" shall mean, as to any Person, (i) securities issued
or directly and fully guaranteed or insured by the United States or any agency
or instrumentality thereof (provided that the full faith and credit of the
United States is pledged in support thereof) having maturities of not more than
one year from the date of acquisition, (ii) Dollar denominated time deposits and
certificates of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company having, a long-term unsecured debt
rating of at least "A" or the equivalent thereof from Standard & Poor's Ratings
Services or "A2" or the equivalent thereof from Xxxxx'x Investors Service, Inc.
with maturities of not more than one year from the date of acquisition by such
Person, (iii) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (i) above entered into
with any bank meeting the qualifications specified in clause (ii) above, (iv)
commercial paper issued by any Person incorporated in the United States rated at
least A-1 or the equivalent thereof by Standard & Poor's Ratings Services or at
least P-1 or the equivalent thereof by Xxxxx'x Investors Service, Inc. and in
each case maturing not more than 270 days after the date of acquisition by such
Person, (v) asset-backed certificates of participation representing a fractional
undivided interest in the assets of a trust, which certificates are rated at
least A-1 or the equivalent thereof by Standard & Poor's Rating Services or at
least P-1 or the equivalent thereof by Xxxxx'x Investors Service, Inc., and (vi)
investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (i) through (v) above.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as the same may be amended from time to
time, 42 U.S.C. Section 9601 et seq.
"Change of Control" shall mean (i) any Person or "group" (within the
meaning of Rules 13d-3 or 13d-5 under the Securities Exchange Act (as in effect
on the Effective Date)), other than the Permitted Holders, shall (A) have
acquired beneficial ownership of 25% or more on a fully diluted basis of the
voting and/or economic interest in the Borrower's capital stock or (B) have
obtained the power (whether or not exercised) to elect a majority of the
Borrower's directors or (ii) the Board of Directors of the Borrower shall cease
to consist of a majority of Continuing Directors.
"Co-Arranger" shall mean First Union National Bank in its capacity as
Co-Arranger. The Co-Arranger shall incur no liabilities and shall have no duties
or responsibilities under this Agreement or any other Credit Document in such
capacity.
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"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the date of this
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or personal) with
respect to which any security interests have been granted (or purport to be
granted) pursuant to any Security Document, including, without limitation, all
Pledge Agreement Collateral, all Security Agreement Collateral, the Mortgaged
Properties, and all cash and Cash Equivalents delivered as collateral pursuant
to Section 4.02 or 10.
"Collateral Agent" shall mean the Administrative Agent acting as
collateral agent for the Secured Creditors pursuant to the Security Documents.
"Collective Bargaining Agreements" shall have the meaning provided in
Section 5.05.
"Commitment" shall mean any of the commitments of any Bank, i.e.,
whether the Term Loan Commitment or the Revolving Loan Commitment. "Commitment
Commission" shall mean the Revolving Loan Commitment Commission.
"Consolidated Current Assets" shall mean, at any time, the
consolidated current assets of the Borrower and its Subsidiaries at such time.
"Consolidated Current Liabilities" shall mean, at any time, the
consolidated current liabilities of the Borrower and its Subsidiaries at such
time, but excluding the current portion of and accrued but unpaid interest on
any Indebtedness under this Agreement and any other long-term Indebtedness which
would otherwise be included therein.
"Consolidated EBIT" shall mean, for any period, Consolidated Net
Income before Consolidated Interest Expense and before provision for taxes for
such period and without giving effect (w) to any extraordinary gains or losses,
(x) to any gains or losses from sales of assets other than from sales of
inventory sold in the ordinary course of business and (y) to any expenses
related to or incurred by the Borrower in connection with the Transaction or any
Permitted Acquisition, provided, however, that with respect to any Permitted
Acquisition which is accounted for as a "purchase," for the Calculation Period
following such acquisition Consolidated EBIT shall include results of operations
of the company or assets so acquired which amounts shall be determined on a Pro
Forma Basis.
"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT
for such period, adjusted by adding thereto the amount of all amortization and
depreciation
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expense of the Borrower and its Subsidiaries that was deducted in arriving at
Consolidated EBIT for such period.
"Consolidated Fixed Charge Coverage Ratio" shall mean, for any period
the ratio of (x) Consolidated EBITDA for such period less the amount of all
Capital Expenditures made by the Borrower and its Subsidiaries during such
period pursuant to Sections 9.07(a) to (y) Consolidated Fixed Charges for such
period.
"Consolidated Fixed Charges" for any period shall mean the sum,
without duplication, of (i) Consolidated Interest Expense for such period, (ii)
the amount of all cash payments made by the Borrower and its Subsidiaries in
respect of taxes or tax liabilities during such period (net of any cash refunds
actually received during such period), (iii) the scheduled principal amount
(after giving effect to any refinancing thereof other than with proceeds of
Loans) of all amortization payments made (or required to be made and not made)
on all Indebtedness (including, without limitation, the principal component of
all Capitalized Lease Obligations) of the Borrower and its Subsidiaries for such
period plus the amount of all voluntary repayments of such Indebtedness during
such period to the extent that any such repayment reduced the amount of any such
scheduled amortization payment and (iv) the amount of all cash Dividends paid by
the Borrower during such period. "Consolidated Indebtedness" shall mean, at any
time, the principal amount of all Indebtedness of the Borrower and its
Subsidiaries at such time determined on a consolidated basis to the extent that
such Indebtedness would be accounted for as debt in accordance with generally
accepted accounting principles plus, without duplication, (i) the maximum amount
available to be drawn under all letters of credit (including any Letters of
Credit) issued for the account of the Borrower and its Subsidiaries and all
unpaid drawings (including any Unpaid Drawings) in respect of such letters of
credit, (ii) the principal amount of all bonds issued by the Borrower and its
Subsidiaries in connection with workers' compensation obligations, lease
obligations and similar obligations, (iii) all Indebtedness set forth on
Schedule VI to the extent outstanding at such time and (iv) the amount of all
Contingent Obligations of the Borrower and its Subsidiaries determined on a
consolidated basis in respect of Indebtedness of other Persons of the type
described above in this definition.
"Consolidated Interest Coverage Ratio" shall mean, for any period, the
ratio of (x) Consolidated EBITDA for such period to (y) Consolidated Interest
Expense for such Test Period.
"Consolidated Interest Expense" shall mean, for any period, the total
consolidated interest expense of the Borrower and its Subsidiaries for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, that portion of Capitalized Lease Obligations of the
Borrower and its Subsidiaries representing the interest factor for such period;
provided that the amortization of fees and expenses with respect to this
Agreement, the Indebtedness incurred hereunder and any Indebtedness incurred
under Section
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9.04(vi) or (vii) shall be excluded from Consolidated Interest Expense to the
extent same would otherwise have been included therein.
"Consolidated Net Income" shall mean, for any Person and period, the
net income (or loss) of such Person and its Subsidiaries for such period,
determined on a consolidated basis (after deduction for minority interests) in
accordance with generally accepted accounting principles, provided that (i) in
determining Consolidated Net Income of the Borrower, the net income (or loss) of
any other Person which is not a Subsidiary of the Borrower or is accounted for
by the Borrower by the equity method of accounting shall be included only to the
extent of the payment of dividends or distributions by such other Person to the
Borrower or a Subsidiary thereof during such period and (ii) the net income (or
loss) of any other Person acquired by such specified Person or a Subsidiary of
such Person in a pooling of interests transaction for any period prior to the
date of such acquisition shall be excluded.
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person as a result of such Person being a general partner of the other
Person, unless the underlying obligation is expressly made non-recourse as to
such general partner, and any obligation of such Person guaranteeing or in
effect guaranteeing any Indebtedness, leases, dividends or other obligations
("primary obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (x) for the purchase or payment of any
such primary obligation or (y) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the holder of such primary obligation
against loss in respect thereof; provided, however, that the term Contingent
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of the Borrower on the
Initial Borrowing Date and each other director, if such other director's
nomination for election to the Board of Directors of the Borrower is recommended
by a majority of the then Continuing Directors or is recommended by a committee
of the Board of Directors a majority of which is composed of the then Continuing
Directors.
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"Credit Documents" shall mean this Agreement and, after the execution
and delivery thereof pursuant to the terms of this Agreement, each Note, the
Subsidiaries Guaranty and each Security Document.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit Party" shall mean the Borrower and each Subsidiary Guarantor.
"Cumulative Net Income Amount" shall mean, on any date of
determination, an amount equal to (i) 50% of Consolidated Net Income (determined
on a cumulative basis) for all Cumulative Net Income Periods ending prior to
such date of determination for which Consolidated Net Income was a positive
number, minus (ii) 100% of Consolidated Net Income (determined on a cumulative
basis) for all Cumulative Net Income Periods ending prior to such date of
determination for which Consolidated Net Income was a negative number.
"Cumulative Net Income Period" shall mean each period consisting of a
fiscal quarter of the Borrower ending after October 1, 1997.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Determination Date" shall have the meaning provided in the definition
of "Pro Forma Basis."
"Dividend" with respect to any Person shall mean that such Person has
declared or paid a dividend or returned any equity capital to its stockholders
or partners or authorized or made any other distribution, payment or delivery of
property (other than common stock of such Person) or cash to its stockholders or
partners as such, or redeemed, retired, purchased or otherwise acquired,
directly or indirectly, for a consideration any shares of any class of its
capital stock or any partnership interests outstanding on or after the Initial
Borrowing Date (or any options or warrants issued by such Person with respect to
its capital stock), or set aside any funds for any of the foregoing purposes, or
shall have permitted any of its Subsidiaries to purchase or otherwise acquire
for a consideration any shares of any class of the capital stock or any
partnership interests of such Person outstanding on or after the Initial
Borrowing Date (or any options or warrants issued by such Person with respect to
its capital stock). Without limiting the foregoing, "Dividends" with respect to
any Person shall also include all payments made or required to be made by such
Person with respect to any stock appreciation rights, plans, equity incentive or
achievement plans or any similar plans or setting aside of any funds for the
foregoing purposes.
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"Documents" shall mean the Credit Documents, the Acquisition Documents
and the Refinancing Documents.
"Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States.
"Domestic Subsidiary" shall mean each Subsidiary of the Borrower
incorporated or organized in the United States or any State or territory
thereof.
"Drawing" shall have the meaning provided in Section 2.05(b).
"Effective Date" shall have the meaning provided in Section 13.10.
"Eligible Transferee" shall mean and include a commercial bank,
insurance company, financial institution, fund or other Person which regularly
purchases interests in loans or extensions of credit of the types made pursuant
to this Agreement, any other Person which would constitute a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act as
in effect on the Effective Date or other "accredited investor" (as defined in
Regulation D of the Securities Act).
"Employee Benefit Plans" shall have the meaning provided in Section
5.05.
"End Date" shall have the meaning provided in the definition of
Applicable Base Rate Margin.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit issued,
or any approval given, under any such Environmental Law (hereafter, "Claims"),
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and
(b) any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief in connection
with alleged injury or threat of injury to health, safety or the environment due
to the presence of Hazardous Materials.
"Environmental Law" shall mean any Federal, state, foreign or local
statute, law, rule, regulation, ordinance, code, guideline, written policy and
rule of common law now or hereafter in effect and in each case as amended, and
any judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
employee health and safety or Hazardous Materials, including, without
limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C.
Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601
et seq.; the Clean Air Act,
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42 U.S.C. Section 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section
3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. Section 2701 et seq.; the
Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C.
Section 11001 et seq.; the Hazardous Material Transportation Act, 49 U.S.C.
Section 1801 et seq. and the Occupational Safety and Health Act, 29 U.S.C.
Section 651 et seq.; and any state and local or foreign counterparts or
equivalents, in each case as amended from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at the
date of this Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor. "ERISA Affiliate" shall
mean each person (as defined in Section 3(9) of ERISA) which together with the
Borrower or a Subsidiary of the Borrower would be deemed to be a "single
employer" within the meaning of Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Loan" shall mean each Loan designated as such by the
Borrower at the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean, with respect to each Interest Period for
a Eurodollar Loan, the London Interbank Offered Rate for borrowings (rounded
upward to the nearest 1/16 of one percent) for deposits of Dollars in minimum
amounts of at least the Minimum Borrowing Amount applicable to such Eurodollar
Loan for a period equivalent to such period at or about 11:00 A.M. (London time)
on the second Business Day before the first day of such period as is displayed
on Telerate page 3750 (British Bankers' Association Interest Settlement Rates)
(or such other page as may replace such page 3750 on such system, provided that
if on such date no such rate is so displayed, the Eurodollar Rate for such
period shall be the rate determined by the Administrative Agent to be the
arithmatic average (rounded upward, if necessary, to the nearest 1/16 of one
percent) of the rate per annum at which deposits of Dollars in an amount
approximately equal to the amount in relation to which the Eurodollar Rate is to
be determined for a period equivalent to such period are being offered by first
class banks in the London Interbank Market at or about 11:00 A.M. (London time)
on the second Business Day before the first day of such period, provided further
that in each case the rate obtained above shall be adjusted to take account of
reserve requirements by dividing such rate by the Eurodollar Reserve Percentage
(with such resulting rate to be rounded upward, if necessary, to the nearest
1/100 of one percent).
"Eurodollar Reserve Percentage" shall mean for any day, the remainder
of one minus the percentage (expressed as a decimal and rounded upwards, if
necessary, to the next higher 1/100th of 1%) which is in effect for such day as
prescribed by the Federal Reserve Board (or any successor) for determining the
maximum reserve requirement (including without limitation any basic,
supplemental or emergency reserves) in respect of Eurocurrency liabilities
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or any similar category of liabilities for a member bank of the Federal Reserve
System in New York City.
"Event of Default" shall have the meaning provided in Section 10.
"Excess Cash Flow" shall mean, for any period, the remainder of (i)
the sum of (a) Adjusted Consolidated Cash Income for such period and (b) the
decrease, if any, in Adjusted Consolidated Working Capital from the first day of
such period to the last day of such period, minus (ii) the sum of (a) the amount
of all Capital Expenditures, made by the Borrower and its Subsidiaries pursuant
to Section 9.07(a) during such period, (b) the aggregate principal amount of
permanent principal payments of Indebtedness for borrowed money of the Borrower
and its Subsidiaries (other than repayments pursuant to which any other
Indebtedness is being refinanced with proceeds of Indebtedness, equity
issuances, asset sales or insurance proceeds, and repayments of Loans, provided
that repayments of Loans shall be deducted in determining Excess Cash Flow if
such repayments were (x) required as a result of a Scheduled Repayment under
Section 4.02(b) or (y) made as a voluntary prepayment (but in the case of a
voluntary prepayment of Revolving Loans or Swingline Loans, only to the extent
accompanied by a voluntary reduction to the Total Revolving Loan Commitment))
during such period and (c) the increase, if any, in Adjusted Consolidated
Working Capital from the first day of such period to the last day of such
period.
"Excess Cash Payment Date" shall mean the date occurring 90 days after
the last day of each fiscal year of the Borrower (beginning with its fiscal year
ending September 30, 1998).
"Excess Cash Payment Period" shall mean, with respect to the repayment
required on each Excess Cash Payment Date, the immediately preceding fiscal year
of the Borrower.
"Existing Indebtedness" shall have the meaning provided in Section
7.22.
"Existing Indebtedness Agreements" shall have the meaning provided in
Section 5.05.
"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating interest
rate equal for each day during such period to the weighted average of the rates
on overnight Federal Funds transactions with members of the Federal Reserve
System arranged by Federal Funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
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transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Figgie" shall mean Figgie International Inc., a Delaware corporation.
"Foreign Pension Plan" shall mean any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained outside the United States of America by the Borrower or any one or
more of its Subsidiaries primarily for the benefit of employees of the Borrower
or such Subsidiaries residing outside the United States of America, which plan,
fund or other similar program provides, or results in, retirement income, a
deferral of income in contemplation of retirement or payments to be made upon
termination of employment, and which plan is not subject to ERISA or the Code.
"Foreign Subsidiary" shall mean each Subsidiary of the Borrower other
than a Domestic Subsidiary.
"Hazardous Materials" shall mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is friable, urea
formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas;
(b) any chemicals, materials or substances defined as or included in the
definition of "hazardous substances," "hazardous waste," "hazardous materials,"
"extremely hazardous substances," "restricted hazardous waste," "toxic
substances," "toxic pollutants," "contaminants," or "pollutants," or words of
similar import, under any applicable Environmental Law; and (c) any other
chemical, material or substance, the Release of which is prohibited, limited or
regulated by any governmental authority.
"Indebtedness" shall mean, as to any Person, without duplication, (i)
all indebtedness (including principal, interest, fees and charges) of such
Person for borrowed money or for the deferred purchase price of property or
services, (ii) the maximum amount available to be drawn under all letters of
credit issued for the account of such Person and all unpaid drawings in respect
of such letters of credit, (iii) all Indebtedness of the types described in
clause (i), (ii), (iv), (v), (vi) or (vii) of this definition secured by any
Lien on any property owned by such Person, whether or not such Indebtedness has
been assumed by such Person (provided, that, if the Person has not assumed or
otherwise become liable in respect of such Indebtedness, such Indebtedness shall
be deemed to be in an amount equal to the fair market value of the property to
which such Lien relates as determined in good faith by such Person), (iv) the
aggregate amount required to be capitalized under leases under which such Person
is the lessee, (v) all obligations of such person to pay a specified purchase
price for goods or services, whether or not delivered or accepted, i.e.,
take-or-pay and similar obligations, (vi) all Contingent Obligations of such
Person and (vii) all obligations under any Interest Rate
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Protection Agreement, any Other Hedging Agreement or under any similar type of
agreement. Notwithstanding the foregoing, Indebtedness shall not include (x)
trade payables and accrued expenses incurred by any Person in accordance with
customary practices and in the ordinary course of business of such Person and
(y) deferred compensation obligations of any Person.
"Indebtedness to be Refinanced" shall mean all Indebtedness set forth
on Schedule IV.
"Initial Borrowing Date" shall mean the date occurring on or after the
Effective Date on which the initial Borrowing of Loans or issuance of a Letter
of Credit occurs.
"Intercompany Loan" shall have the meaning provided in Section
9.05(vi).
"Intercompany Note" shall mean a promissory note, in the form of
Exhibit L, evidencing Intercompany Loans.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.
"Investments" shall have the meaning provided in Section 9.05.
"Issuing Bank" shall mean First Union National Bank and any other Bank
which at the request of the Borrower and with the consent of the Agents (which
consent shall not be unreasonably withheld) agrees, in such Bank's sole
discretion, to become an Issuing Bank for the purpose of issuing Letters of
Credit pursuant to Section 2. The sole Issuing Bank on the Initial Borrowing
Date is First Union National Bank.
"Leaseholds" of any Person shall mean all the right, title and
interest of such Person as lessee or licensee in, to and under leases or
licenses of land, improvements and/or fixtures.
"L/C Supportable Obligations" shall mean (i) obligations of the
Borrower or any of its Subsidiaries with respect to workers compensation, surety
bonds and other similar statutory obligations and (ii) such other obligations of
the Borrower or any of its Subsidiaries as are otherwise permitted to exist
pursuant to (or otherwise not restricted by) the terms of this
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Agreement, other than any Indebtedness for borrowed money unless consented to by
the Agents and the Issuing Bank.
"Lending Office" shall mean, with respect to any Bank, any office,
branch, subsidiary or affiliate of such Bank.
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in Section 3.01(c).
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii)
the amount of all Unpaid Drawings.
"Letter of Credit Request" shall have the meaning provided in Section
2.03(a).
"Leverage Ratio" shall mean, at any time, the ratio of (x)
Consolidated Indebtedness at such time to (y) Consolidated EBITDA for the then
most recently ended Test Period; provided that for purposes of the definition of
Leverage Ratio only, (i) for the Test Period ending December 31, 1997,
Consolidated EBITDA shall be the actual Consolidated EBITDA for such Test Period
multiplied by 4; (ii) for the Test Period ending March 31, 1997, Consolidated
EBITDA shall be the actual Consolidated EBITDA for such Test Period multiplied
by 2; and (iii) for the Test Period ending June 30, 1997, Consolidated EBITDA
shall be the actual Consolidated EBITDA for such Test Period multiplied by 4/3.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the UCC or
any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Term Loan, each Revolving Loan and each
Swingline Loan.
"Majority Banks" of any Tranche shall mean those Non-Defaulting Banks
which would constitute the Required Banks under, and as defined in, this
Agreement if all outstanding Obligations of the other Tranches under this
Agreement were repaid in full and all Commitments with respect thereto were
terminated.
"Management Agreements" shall have the meaning provided in Section
5.05.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(d).
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"Margin Stock" shall have the meaning provided in Regulation U.
"Maturity Date" shall mean, with respect to any Tranche of Loans, the
Term Loan Maturity Date, the Revolving Loan Maturity Date or the Swingline
Expiry Date, as the case may be. "Maximum Swingline Amount" shall mean
$5,000,000.
"Minimum Borrowing Amount" shall mean (i) for Term Loans, $5,000,000,
(ii) for Revolving Loans, $1,000,000 and (iii) for Swingline Loans, $250,000.
"Minnesota Mortgage" shall mean the Mortgage granted by Lull
International, Inc. with respect to its real property and fixtures in the state
of Minnesota.
"Mortgage" shall mean each mortgage, deed to secure debt or deed of
trust pursuant to which any Credit Party shall have granted to the Collateral
Agent a mortgage lien on such Credit Party's Mortgaged Property.
"Mortgage Policy" shall have the meaning provided in Section 5.14.
"Mortgaged Property" shall mean (i) each Real Property owned by any
Credit Party and designated as a Mortgaged Property on Schedule III and (ii)
each Real Property owned or leased by any Credit Party and designated as a
Mortgaged Property pursuant to Section 8.12.
"MSSF" shall mean Xxxxxx Xxxxxxx Senior Funding, Inc., in its
individual capacity.
"Multiemployer Plan" shall mean a plan as defined in Section
4001(a)(3) of ERISA with respect to which the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate has an obligation to contribute to or any
liability.
"NAIC" shall mean the National Association of Insurance Commissioners.
"Net Debt Proceeds" shall mean, with respect to any incurrence of
Indebtedness for borrowed money, the cash proceeds (net of underwriting
discounts and commissions, commitment and other financing fees and other costs
associated therewith) received by the respective Person from the respective
incurrence of such Indebtedness for borrowed money.
"Net Insurance Proceeds" shall mean, with respect to any Recovery
Event, the cash proceeds (net of costs and taxes incurred in connection with
such Recovery Event) received by the respective Person in connection with the
respective Recovery Event.
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"Net Sale Proceeds" shall mean, for any Asset Sale, the gross cash
proceeds (including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from such sale of assets, net of the costs of such sale (including fees
and commissions, payments of unassumed liabilities relating to the assets sold
and required payments of any Indebtedness (other than Indebtedness secured
pursuant to the Security Documents or any Indebtedness owed to the Borrower or a
Subsidiary thereof) which is secured by the respective assets which were sold),
and the taxes paid or payable as a result of such Asset Sale.
"New Subordinated Note Documents" shall mean the New Subordinated
Notes, any indenture or purchase agreement related thereto and each of the other
documents entered into in connection therewith.
"New Subordinated Notes" shall have the meaning provided in Section
9.04(vi).
"Non-Defaulting Bank" shall mean and include each Bank other than a
Defaulting Bank.
"Non-Excluded Taxes" shall have the meaning provided in Section
4.04(a).
"Note" shall mean each Term Note, each Revolving Note and the
Swingline Note.
"Notice of Borrowing" shall have the meaning provided in Section
1.03(a).
"Notice of Conversion" shall have the meaning provided in Section
1.06.
"Notice Office" shall mean the office of the Administrative Agent
located at One First Union Center, 000 Xxxxx Xxxxxxx Xxxxxx, XX-00, Xxxxxxxxx,
XX 00000-0000, Attention: Syndication Services, with copies to 000 Xxxxx Xxxxxxx
Xxxxxx, XX-0, Xxxxxxxxx, XX 00000-0000, Attention: Leveraged Finance, or such
other office as the Administrative Agent may hereafter designate in writing as
such to the other parties hereto.
"Obligations" shall mean all amounts owing to any Agent, the
Collateral Agent or any Bank pursuant to the terms of this Agreement or any
other Credit Document.
"Other Creditor" shall have the meaning provided in the Security
Documents.
"Other Hedging Agreement" shall mean any foreign exchange contracts,
currency swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency values.
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"Participant" shall have the meaning provided in Section 2.04(a).
"Payment Office" shall mean the office of the Administrative Agent
located at One First Union Center, 000 Xxxxx Xxxxxxx Xxxxxx, XX-00, Xxxxxxxxx,
XX 00000-0000, Attention: Syndication Services, or such other office as the
Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in Section
9.02(ix).
"Permitted Encumbrance" shall mean, with respect to any Mortgaged
Property, such exceptions to title as are set forth in the title insurance
policy or title commitment delivered with respect thereto and accepted by the
Agents.
"Permitted Holders" shall mean Harbor Group Investments III, L.P.,
Uniquip-HGI Associates, L.P., X. Xxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxx and Xxxxxx Xxxxx.
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, limited liability company, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" shall mean any pension plan as defined in Section 3(2) of
ERISA, other than a multiemployer plan as defined in Section 4001(a)(3) of
ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower or a Subsidiary of the Borrower or an
ERISA Affiliate or with respect to which any such entity has liability.
"Pledge Agreement" shall have the meaning provided in Section 5.11.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in the Pledge Agreement.
"Pledged Notes" shall have the meaning provided in the Pledge
Agreement.
"Pledged Securities" shall mean all "Pledged Securities" as defined in
the Pledge Agreement.
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"Prime Lending Rate" shall mean the rate which the Administrative
Agent announces from time to time as its prime lending rate, the Prime Lending
Rate to change when and as such prime lending rate changes. The Prime Lending
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer. The Administrative Agent may make
commercial loans or other loans at rates of interest at, above or below the
Prime Lending Rate.
"Pro Forma Basis" shall mean, with respect to any Permitted
Acquisition, the calculation of the consolidated results of the Borrower and its
Subsidiaries otherwise determined in accordance with this Agreement as if the
respective Permitted Acquisition (and all Indebtedness incurred to finance such
Permitted Acquisition, and all other Permitted Acquisitions, effected during the
respective Calculation Period or thereafter and on or prior to the date of
determination) (each such date, a "Determination Date") had been effected on the
first day of the respective Calculation Period; provided that all such
calculations shall be made on a basis consistent with the requirements of
Regulation S-X under the Securities Act and the Securities Exchange Act and
shall take into account the following assumptions:
(i) interest expense attributable to interest on any Indebtedness
(whether existing or being incurred) bearing a floating interest rate shall
be computed as if the rate in effect on the date of computation (taking
into account any Interest Rate Protection Agreement applicable to such
Indebtedness if such Interest Rate Protection Agreement has a remaining
term in excess of 12 months) had been the applicable rate for the entire
period; and
(ii) pro forma effect shall be given to all Permitted Acquisitions (by
excluding or including, as the case may be, the historical financial
results for the respective properties) that occur during such Calculation
Period or thereafter and on or prior to the Determination Date (including
any Indebtedness assumed or acquired in connection therewith) as if they
had occurred on the first day of such Calculation Period, in each case to
the extent that the occurrence of any such event required the financial
covenants contained in Sections 9.08 through 9.10, inclusive, to be
recalculated on a Pro Forma Basis.
"Projections" shall mean the projections prepared by the Borrower
relating to the Transaction and delivered to the Agents prior to the Effective
Date.
"Quarterly Payment Date" shall mean each March 31, June 30, September
30 and December 31 occurring after the Initial Borrowing Date.
"RCRA" shall mean the Resource Conservation and Recovery Act, as the
same may be amended from time to time, 42 U.S.C. Section 6901 et seq.
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"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation awards payable (i)
by reason of theft, loss, physical destruction, damage, taking or any other
similar event with respect to any property or assets of the Borrower or any of
its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 8.03.
"Refinancing" shall mean the repayment in full of, and the termination
of all commitments in respect of, the Indebtedness to be Refinanced.
"Refinancing Documents" shall mean all of the documents and agreements
entered into in connection with the Refinancing.
"Register" shall have the meaning provided in Section 13.15.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Release" shall mean the disposing, discharging, injecting, spilling,
pumping, leaking, leaching, dumping, emitting, escaping, emptying, pouring or
migrating, into or upon any land or water or air, or otherwise entering into the
environment.
"Replaced Bank" shall have the meaning provided in Section 1.13.
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"Replacement Bank" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(c) of
ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
.13, .14, .16, .18, .19 or .20 of PBGC Regulation Section 4043.
"Required Banks" shall mean Non-Defaulting Banks the sum of whose
outstanding Term Loans (and, if prior to the termination thereof, Term Loan
Commitments), and Revolving Loan Commitments (or after the termination thereof,
outstanding Revolving Loans and Adjusted RL Percentage of Swingline Loans and
Letter of Credit Outstandings) represent an amount greater than 50% of the sum
of all outstanding Term Loans (and, if prior to the termination thereof, the
Term Loan Commitments) of Non-Defaulting Banks, and the Adjusted Total Revolving
Loan Commitment (or after the termination thereof, the sum of the then total
outstanding Revolving Loans of Non-Defaulting Banks, and the aggregate Adjusted
RL Percentages of all Non-Defaulting Banks of the total outstanding Swingline
Loans and Letter of Credit Outstandings at such time).
"Revolving Loan" shall have the meaning provided in Section 1.01(b).
"Revolving Loan Commitment" shall mean, for each Bank, the amount set
forth opposite such Bank's name in Schedule I directly below the column entitled
"Revolving Loan Commitment," as same may be (x) reduced from time to time
pursuant to Sections 3.02, 3.03 and/or 10 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"Revolving Loan Commitment Commission" shall have the meaning provided
in Section 3.01(a).
"Revolving Loan Maturity Date" shall mean November 17, 2004.
"Revolving Note" shall have the meaning provided in Section 1.05(a).
"RL Percentage" of any Bank at any time shall mean a fraction
(expressed as a percentage) the numerator of which is the Revolving Loan
Commitment of such Bank at such time and the denominator of which is the Total
Revolving Loan Commitment at such time, provided that if the RL Percentage of
any Bank is to be determined after the Total Revolving Loan Commitment has been
terminated, then the RL Percentages of the Banks shall be determined immediately
prior (and without giving effect) to such termination.
"Scheduled Repayments" shall have the meaning provided in Section
4.02(b).
"SEC" shall have the meaning provided in Section 8.01(g).
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"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b)(ii).
"Secured Creditors" shall have the meaning assigned that term in the
respective Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 5.11.
"Security Agreement Collateral" shall mean all "Collateral" as defined
in the Security Agreement.
"Security Document" shall mean and include each of the Security
Agreement, the Pledge Agreement and each Mortgage and, after the execution and
delivery thereof, each Additional Security Document.
"Shareholders' Agreements" shall have the meaning provided in Section
5.05.
"SKL" shall mean SKL Lift, Inc., a Delaware corporation, to be renamed
Snorkel International, Inc.
"Standby Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Start Date" shall have the meaning provided in the definition of
Applicable Base Rate Margin.
"Stated Amount" of each Letter of Credit shall, at any time, mean the
maximum amount available to be drawn thereunder (in each case determined without
regard to whether any conditions to drawing could then be met).
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
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"Subsidiary Guarantor" shall mean each Wholly-Owned Domestic
Subsidiary of the Borrower and, to the extent required by Section 8.13, each
Wholly-Owned Foreign Subsidiary of the Borrower.
"Subsidiaries Guaranty" shall have the meaning provided in Section
5.12.
"Supermajority Banks" of any Tranche shall mean those Non-Defaulting
Banks which would constitute the Required Banks under, and as defined in, this
Agreement if (x) all outstanding Obligations of the other Tranches under this
Agreement were repaid in full and all Commitments with respect thereto were
terminated and (y) the percentage "50%" contained therein were changed to
"66-2/3%."
"Swingline Bank" shall mean First Union National Bank.
"Swingline Expiry Date" shall mean the date which is five Business
Days prior to the Revolving Loan Maturity Date.
"Swingline Loan" shall have the meaning provided in Section 1.01(c).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Syndication Agent" shall mean MSSF, in its capacity as Syndication
Agent and Arranger for the Banks hereunder.
"Syndication Date" shall have the meaning provided in Section 1.01(a).
"Tax Sharing Agreements" shall have the meaning provided in Section
5.05.
"Term Loan" shall have the meaning provided in Section 1.01(a).
"Term Loan Commitment" shall mean, for each Bank, the amount set forth
opposite such Bank's name in Schedule I directly below the column entitled "Term
Loan Commitment," as same may be (x) reduced from time to time pursuant to
Sections 3.02, 3.03, 4.02 and/or 10 or (y) adjusted from time to time as a
result of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"Term Loan Maturity Date" shall mean November 17, 2004.
"Term Loan Percentage" shall mean, at any time, a fraction (expressed
as a percentage) the numerator of which is equal to the sum of the aggregate
principal amount of all Term Loans outstanding at such time plus the Total Term
Loan Commitment at such time and the denominator of which is equal to the sum of
the aggregate principal amount of all Term Loans outstanding at such time plus
the Total Term Loan Commitment at such time.
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"Term Note" shall have the meaning provided in Section 1.05(a).
"Test Period" shall mean (i) for any determination made on and prior
to September 30, 1998, the period from October 1, 1997 to the last day of the
fiscal quarter of the Borrower then last ended (in each case taken as one
accounting period) and (ii) for any determination made thereafter, the period of
four consecutive fiscal quarters of the Borrower then last ended (in each case
taken as one accounting period).
"Total Term Loan Commitment" shall mean, at any time, the sum of the
Term Loan Commitments of each of the Banks.
"Total Commitments" shall mean, at any time, the sum of the
Commitments of each of the Banks.
"Total Revolving Loan Commitment" shall mean, at any time, the sum of
the Revolving Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any time,
an amount equal to the remainder of (x) the Total Revolving Loan Commitment then
in effect, less (y) the sum of the aggregate principal amount of Revolving Loans
and Swingline Loans then outstanding plus the then aggregate amount of Letter of
Credit Outstandings.
"Trade Letter of Credit" shall have the meaning provided in Section
2.01(a).
"Tranche" shall mean the respective facility and commitments utilized
in making Loans hereunder, with there being three separate Tranches, i.e., Term
Loans, Revolving Loans and Swingline Loans.
"Transaction" shall mean, collectively, (i) the Acquisition, (ii) the
incurrence of Loans on the Initial Borrowing Date, (iii) the Refinancing and
(iv) the payment of fees and expenses owing in connection with the foregoing.
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto, i.e., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
the Plan as of the close of its most recent plan year exceeds the fair market
value of the assets allocable thereto, each determined in accordance with
Statement of Financial Accounting Standards No. 87,
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based upon the actuarial assumptions used by the Plan's actuary in the most
recent annual valuation of the Plan.
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided for in Section
2.05(a).
"Unutilized Revolving Loan Commitment" with respect to any Bank, at
any time, shall mean such Bank's Revolving Loan Commitment at such time less the
sum of (i) the aggregate outstanding principal amount of Revolving Loans made by
such Bank and (ii) such Bank's Adjusted RL Percentage of the Letter of Credit
Outstandings.
"U.S. Internal Revenue Service Forms" shall have the meaning provided
in Section 4.04(b).
"Wholly-Owned Domestic Subsidiary" shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person which is a Domestic Subsidiary.
"Wholly-Owned Foreign Subsidiary" shall mean, as to any Person, any
Wholly-Owned Subsidiary of such Person which is a Foreign Subsidiary.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
SECTION 12. The Administrative Agent and the Syndication Agent.
12.01. Appointment. The Banks hereby designate First Union National
Bank as Administrative Agent (for purposes of this Section 12, the term
"Administrative Agent" also shall include First Union National Bank in its
capacity as Co-Arranger hereunder and as Collateral Agent pursuant to the
Security Documents) to act as specified herein and in the other Credit
Documents. The Banks hereby designate MSSF as Syndication Agent (for purposes of
this Section 12, the term "Syndication Agent" also shall include MSSF in its
capacity as Arranger) to act as specified herein and in the other Credit
Documents. Each Bank hereby irrevocably authorizes, and each holder of any Note
by the acceptance of such Note shall be deemed irrevocably to authorize, the
Administrative Agent and the Syndication Agent to take such action on its behalf
under the provisions of this Agreement, the other Credit Documents and any other
instruments and agreements referred to herein or therein and to exercise such
powers and to perform such duties hereunder and thereunder as are specifically
delegated to or required of the Administrative Agent and the Syndication Agent
by the terms hereof and thereof and such other powers as are reasonably
incidental thereto. The Administrative Agent
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and the Syndication Agent may perform any of their duties hereunder by or
through its respective officers, directors, agents, employees or affiliates.
12.02 Nature of Duties. Neither the Administrative Agent nor the
Syndication Agent in their capacity as such shall have any duties or
responsibilities except those expressly set forth in this Agreement and in the
other Credit Documents. Neither the Administrative Agent, the Syndication Agent
in their capacity as such nor any of their respective officers, directors,
agents, employees or affiliates shall be liable for any action taken or omitted
by it or them hereunder or under any other Credit Document or in connection
herewith or therewith, unless caused by its or their gross negligence or willful
misconduct. The duties of the Administrative Agent and the Syndication Agent
shall be mechanical and administrative in nature; neither the Administrative
Agent nor the Syndication Agent shall have by reason of this Agreement or any
other Credit Document a fiduciary relationship in respect of any Bank or the
holder of any Note; and nothing in this Agreement or any other Credit Document,
expressed or implied, is intended to or shall be so construed as to impose upon
the Administrative Agent or the Syndication Agent any obligations in respect of
this Agreement or any other Credit Document except as expressly set forth herein
or therein.
12.03 Lack of Reliance on the Administrative Agent and the Syndication
Agent. Independently and without reliance upon the Administrative Agent or the
Syndication Agent, each Bank and the holder of each Note, to the extent it deems
appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Borrower and its
Subsidiaries in connection with the making and the continuance of the Loans and
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrower and its Subsidiaries and,
except as expressly provided in this Agreement, neither the Administrative Agent
nor the Syndication Agent shall have any duty or responsibility, either
initially or on a continuing basis, to provide any Bank or the holder of any
Note with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter. Neither the Administrative Agent nor the Syndication Agent shall be
responsible to any Bank or the holder of any Note for any recitals, statements,
information, representations or warranties herein or in any document,
certificate or other writing delivered in connection herewith or for the
execution, effectiveness, genuineness, validity, enforceability, perfection,
collectibility, priority or sufficiency of this Agreement or any other Credit
Document or the financial condition of the Borrower or any of its Subsidiaries
or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any other Credit Document, or the financial condition of the Borrower or any of
its Subsidiaries or the existence or possible existence of any Default or Event
of Default.
12.04 Certain Rights of the Agents. If any Agent shall request
instructions from the Required Banks with respect to any act or action
(including failure to act) in connection with this Agreement or any other Credit
Document, such Agent shall be entitled
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to refrain from such act or taking such action unless and until such Agent shall
have received instructions from the Required Banks; and such Agent shall not
incur liability to any Person by reason of so refraining. Without limiting the
foregoing, no Bank or the holder of any Note shall have any right of action
whatsoever against any Agent as a result of such Agent acting or refraining from
acting hereunder or under any other Credit Document in accordance with the
instructions of the Required Banks.
12.05 Reliance. The Administrative Agent and the Syndication Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, statement, certificate, telex, teletype or
telecopier message, cablegram, radiogram, order or other document or telephone
message signed, sent or made by any Person that the Administrative Agent or the
Syndication Agent believed to be the proper Person, and, with respect to all
legal matters pertaining to this Agreement and any other Credit Document and its
duties hereunder and thereunder, upon advice of counsel selected by the
Administrative Agent or the Syndication Agent, as the case may be.
12.06 Indemnification. To the extent the Administrative Agent or the
Syndication Agent is not reimbursed and indemnified by the Borrower or any of
its Subsidiaries, the Banks will reimburse and indemnify the Administrative
Agent and the Syndication Agent, in proportion to their respective "percentages"
as used in determining the Required Banks, for and against any and all
liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Administrative Agent or
the Syndication Agent in performing its respective duties hereunder or under any
other Credit Document, in any way relating to or arising out of this Agreement
or any other Credit Document; provided that no Bank shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's or the Syndication Agent's gross negligence or willful
misconduct.
12.07 The Administrative Agent and the Syndication Agent in Their
Individual The Administrative Agent and the Syndication Agent in Their
Individual Capacity . With respect to its obligation to make Loans, or issue or
participate in Letters of Credit, under this Agreement, the Administrative Agent
and the Syndication Agent shall have the rights and powers specified herein for
a "Bank" and may exercise the same rights and powers as though it were not
performing the duties specified herein; and the term "Banks," "Required Banks,"
"Majority Banks," "Supermajority Banks," "holders of Notes" or any similar terms
shall, unless the context clearly otherwise indicates, include the
Administrative Agent and the Syndication Agent in their individual capacity. The
Administrative Agent and the Syndication Agent and their affiliates may accept
deposits from, lend money to, and generally engage in any kind of banking,
investment banking, trust or other business with, or provide debt financing,
equity capital or other services (including financial advisory services) to, any
Credit Party or any Affiliate of any Credit Party (or any Person engaged in a
similar business with any Credit Party or any Affiliate thereof) as if they were
not performing the
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duties specified herein, and may accept fees and other consideration from any
Credit Party or any Affiliate of any Credit Party for services in connection
with this Agreement and otherwise without having to account for the same to the
Banks.
12.08 Holders. Any Agent may deem and treat the payee of any Note as
the owner thereof for all purposes hereof unless and until a written notice of
the assignment, transfer or endorsement thereof, as the case may be, shall have
been filed with the Administrative Agent. Any request, authority or consent of
any Person who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee, assignee or indorsee, as the case may be, of such
Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Administrative Agent and the Syndication
Agent. (a) The Administrative Agent and/or the Syndication Agent may resign from
the performance of all their respective functions and duties hereunder and/or
under the other Credit Documents at any time by giving 15 Business Days' prior
written notice to the Banks and the Borrower (provided that no such notice shall
be required to be given to the Borrower if a Default or an Event of Default of
the type described in Section 10.05 exists with respect to the Borrower). Such
resignation, in the case of the Administrative Agent, shall take effect upon the
appointment of a successor Administrative Agent pursuant to clauses (b) and (c)
below or as otherwise provided below, and such resignation, in the case of the
Syndication Agent, shall take effect immediately.
(b) Upon any such notice of resignation by the Administrative Agent,
the Required Xxxxx shall appoint a successor Administrative Agent hereunder or
thereunder who shall be a commercial bank or trust company reasonably acceptable
to the Borrower (it being understood and agreed that any Non-Defaulting Bank is
deemed to be acceptable to the Borrower).
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent with the
consent of the Borrower (which consent shall not be unreasonably withheld or
delayed), shall then appoint a successor Administrative Agent who shall serve as
Administrative Agent hereunder or thereunder until such time, if any, as the
Required Xxxxx appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed pursuant
to clause (b) or (c) above by the 60th day after the date such notice of
resignation was given by the Administrative Agent, Administrative Agent's
resignation shall become effective and the Required Banks shall thereafter
perform all the duties of the Administrative Agent hereunder and/or under any
other Credit Document until such time, if any, as the Required Xxxxx appoint a
successor Administrative Agent as provided above.
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SECTION 13. Miscellaneous
13.01 Payment of Expenses, etc. The Borrower shall: (i) whether or
not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses (w) of the Agents (including, without
limitation, the reasonable fees and disbursements of White & Case (subject to
the limitations agreed to by the Agents and the Borrower) and of the Agents's
local counsel and consultants) in connection with the preparation, execution and
delivery of this Agreement and the other Credit Documents and the documents and
instruments referred to herein and therein, (x) of the Agents (including,
without limitation, the reasonable fees and expenses of White & Case or any
other single law firm retained by the Agents) with respect to any amendment,
waiver or consent relating to this Agreement and/or the other Credit Documents,
(y) of the Agents in connection with their syndication efforts with respect to
this Agreement and (z) of the Agents and, after the occurrence of an Event of
Default, each of the Banks in connection with the enforcement of this Agreement
and the other Credit Documents and the documents and instruments referred to
herein and therein (including, without limitation, the reasonable fees and
disbursements of counsel for the Agents and, after the occurrence of an Event of
Default, for each of the Banks); (ii) pay and hold each of the Banks harmless
from and against any and all present and future stamp, excise and other similar
documentary taxes with respect to the foregoing matters and save each of the
Banks harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent attributable to
such Bank) to pay such taxes; and (iii) indemnify each Agent and each Bank, and
each of their respective officers, directors, employees, representatives and
agents from and hold each of them harmless against any and all liabilities,
obligations (including removal or remedial actions), losses, damages, penalties,
claims, actions, judgments, suits, costs, expenses and disbursements (including
reasonable attorneys' and consultants' fees and disbursements) incurred by,
imposed on or assessed against any of them as a result of, or arising out of, or
in any way related to, or by reason of, (a) any investigation, litigation or
other proceeding (whether or not any Agent or any Bank is a party thereto)
related to the entering into and/or performance of this Agreement or any other
Credit Document or the use of any Letter of Credit or the proceeds of any Loans
hereunder or the consummation of the Transaction or any other transactions
contemplated herein or in any other Credit Document or the exercise of any of
their rights or remedies provided herein or in the other Credit Documents, or
(b) the actual or alleged presence of Hazardous Materials in the air, surface
water or groundwater or on the surface or subsurface of any Real Property owned
or at any time operated by the Borrower or any of its Subsidiaries, the
generation, storage, transportation, handling or disposal of Hazardous Materials
at any location, whether or not owned or operated by the Borrower or any of its
Subsidiaries, the non-compliance of any Real Property with foreign, federal,
state and local laws, regulations, and ordinances (including applicable permits
thereunder) applicable to any Real Property, or any Environmental Claim asserted
against the Borrower, any of its Subsidiaries or any Real Property owned or at
any time operated by the Borrower or any of its Subsidiaries, including, in each
case, without limitation, the reasonable fees and disbursements of counsel and
other consultants incurred in connection with any such investigation, litigation
or other proceeding
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(but excluding any losses, liabilities, claims, damages or expenses to the
extent incurred by reason of the gross negligence, bad faith or willful
misconduct of the Person to be indemnified). To the extent that the undertaking
to indemnify, pay or hold harmless any Agent or any Bank set forth in the
preceding sentence may be unenforceable because it is violative of any law or
public policy, the Borrower shall make the maximum contribution to the payment
and satisfaction of each of the indemnified liabilities which is permissible
under applicable law.
13.02 Right of Setoff. In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default, each Bank is hereby
authorized (to the extent not prohibited by applicable law) at any time or from
time to time, without presentment, demand, protest or other notice of any kind
to the Borrower or to any other Person, any such notice being hereby expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special) and any other Indebtedness at any time held or owing by such Bank
(including, without limitation, by branches and agencies of such Bank wherever
located) to or for the credit or the account of any Credit Party against and on
account of the Obligations and liabilities of the Credit Parties to such Bank
under this Agreement or under any of the other Credit Documents, including,
without limitation, all interests in Obligations purchased by such Bank pursuant
to Section 13.06(b), and all other claims of any nature or description arising
out of or connected with this Agreement or any other Credit Document,
irrespective of whether or not such Bank shall have made any demand hereunder
and although said Obligations, liabilities or claims, or any of them, shall be
contingent or unmatured. Notwithstanding anything to the contrary contained in
this Section 13.02, no Bank shall exercise any such right of set-off without the
prior consent of the Agents or the Required Banks so long as the Obligations
shall be secured by any Real Property located in the State of California, it
being understood and agreed, however, that this sentence is for the sole benefit
of the Banks and (notwithstanding anything to the contrary contained in Section
13.12) may be amended, modified or waived in any respect by the Required Banks
without the requirement of prior notice to or consent by any Credit Party and
does not constitute a waiver of any right against any Credit Party or against
any Collateral.
13.03 Notices. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to any Credit Party,
at the address specified opposite its signature below or in the other relevant
Credit Documents; if to any Bank, at its address specified on Schedule II; if to
the Syndication Agent, at the address specified on Schedule II; and if to the
Administrative Agent, at its Notice Office; or, as to any Credit Party or any
Agent, at such other address as shall be designated by such party in a written
notice to the other parties hereto and, as to each Bank, at such other address
as shall be designated by such Bank in a written notice to the Borrower and the
Administrative Agent. All such notices and communications shall, when mailed,
telegraphed, telexed, telecopied, or cabled or sent by overnight courier, be
effective
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when deposited in the mails, delivered to the telegraph company, cable company
or overnight courier, as the case may be, or sent by telex or telecopier, except
that notices and communications to any Agent or any Credit Party shall not be
effective until received by such Agent or such Credit Party.
13.04 Benefit of Agreement; Assignments; Participations. (a) This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the respective successors and assigns of the parties hereto; provided,
however, the Borrower may not assign or transfer any of its rights, obligations
or interest hereunder without the prior written consent of the Banks and,
provided further, that, although any Bank may transfer, assign or grant
participations in its rights hereunder, such Bank shall remain a "Bank" for all
purposes hereunder (and may not transfer or assign all or any portion of its
Commitments hereunder except as provided in Sections 1.13 and 13.04(b)) and the
transferee, assignee or participant, as the case may be, shall not constitute a
"Bank" hereunder and, provided further, that no Bank shall transfer or grant any
participation under which the participant shall have rights to approve any
amendment to or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (i) extend the final scheduled
maturity of any Loan, Note or Letter of Credit (unless such Letter of Credit is
not extended beyond the Revolving Loan Maturity Date) in which such participant
is participating, or reduce the rate or extend the time of payment of interest
or Fees thereon (except in connection with a waiver of applicability of any
post-default increase in interest rates) or reduce the principal amount thereof,
or increase the amount of the participant's participation over the amount
thereof then in effect (it being understood that a waiver of any Default or
Event of Default or of a mandatory reduction in the Total Commitment, shall not
constitute a change in the terms of such participation, and that an increase in
any Commitment or Loan shall be permitted without the consent of any participant
if the participant's participation is not increased as a result thereof), (ii)
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement or (iii) release all or substantially all of
the Collateral under all of the Security Documents (except as expressly provided
in the Credit Documents) supporting the Loans hereunder in which such
participant is participating. In the case of any such participation, the
participant shall not have any rights under this Agreement or any of the other
Credit Documents (the participant's rights against such Bank in respect of such
participation to be those set forth in the agreement executed by such Bank in
favor of the participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Bank had not sold such
participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank together
with one or more other Banks) may (x) assign all or a portion of its Commitments
and related outstanding Obligations hereunder to its parent company and/or any
affiliate of such Bank which is at least 50% owned by such Bank or its parent
company or to one or more Banks or (y) assign all, or if less than all, a
portion equal to at least $5,000,000 in the aggregate for the assigning Bank or
assigning Xxxxx, of such Commitments and related outstanding Obligations
hereunder to one or more Eligible Transferees, each of which assignees shall
become a party
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to this Agreement as a Bank by execution of an Assignment and Assumption
Agreement, provided that, (i) at such time Schedule I shall be deemed modified
to reflect the Commitments (or outstanding Term Loans, as the case may be) of
such new Bank and of the existing Banks, (ii) upon the surrender of the relevant
Notes by the assigning Bank (or, upon such assigning Bank's indemnifying the
Borrower for any lost Note pursuant to a customary indemnification agreement)
new Notes will be issued, at the Borrower's expense, to such new Bank and to the
assigning Bank upon the request of such new Bank or assigning Bank, such new
Notes to be in conformity with the requirements of Section 1.05 (with
appropriate modifications) to the extent needed to reflect the revised
Commitments (or outstanding Term Loans, as the case may be), (iii) the consent
of the Agents shall be required in connection with any assignment to an Eligible
Transferee pursuant to clause (y) above (which consent shall not be unreasonably
withheld or delayed), (iv) so long as no Default or Event of Default exists, the
consent of the Borrower shall be required in connection with any assignment to
an Eligible Transferee pursuant to clause (y) above (which consent shall not be
unreasonably withheld or delayed, provided that the Borrower may withhold its
consent to a proposed assignment if such assignment would result in increased
costs to the Borrower under Section 1.10, 2.06 or 4.04), (v) the Administrative
Agent shall receive at the time of each such assignment, from the assigning or
assignee Bank, the payment of a non-refundable assignment fee of $3,500 and (vi)
no such transfer or assignment will be effective until recorded by the
Administrative Agent on the Register pursuant to Section 13.15. To the extent of
any assignment pursuant to this Section 13.04(b), the assigning Bank shall be
relieved of its obligations hereunder with respect to its assigned Commitments.
At the time of each assignment pursuant to this Section 13.04(b) to a Person
which is not already a Bank hereunder and which is not a United States person
(as such term is defined in Section 7701(a)(30) of the Code) for Federal income
tax purposes, the respective assignee Bank shall, to the extent legally entitled
to do so, provide to the Borrower the appropriate Internal Revenue Service Forms
(and, if applicable, a Section 4.04(b) (ii) Certificate) described in Section
4.04(b). To the extent that an assignment of all or any portion of a Bank's
Commitments and related outstanding Obligations pursuant to Section 1.13 or this
Section 13.04(b) would, at the time of such assignment, result in increased
costs under Section 1.10, 2.06 or 4.04 from those being charged by the
respective assigning Bank prior to such assignment, then the Borrower shall not
be obligated to pay such increased costs (although the Borrower, in accordance
with and pursuant to the other provisions of this Agreement, shall be obligated
to pay any other increased costs of the type described above resulting from
changes after the date of the respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit any Bank from
pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of
borrowings made by such Bank from such Federal Reserve Bank.
13.05 No Waiver; Remedies Cumulative . No failure or delay on the part
of the Administrative Agent or the Syndication Agent or any Bank in exercising
any right, power or privilege hereunder or under any other Credit Document and
no course of dealing between the Borrower or any other Credit Party and the
Administrative Agent, the Syndication Agent
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or any Bank shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under any other Credit
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The rights, powers and
remedies herein or in any other Credit Document expressly provided are
cumulative and not exclusive of any rights, powers or remedies which the
Administrative Agent, the Syndication Agent or any Bank would otherwise have. No
notice to or demand on any Credit Party in any case shall entitle any Credit
Party to any other or further notice or demand in similar or other circumstances
or constitute a waiver of the rights of the Administrative Agent, the
Syndication Agent or any Bank to any other or further action in any
circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise provided in this
Agreement, the Administrative Agent agrees that promptly after its receipt of
each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, it shall distribute such payment to the Banks (other than any Bank
that has consented in writing to waive its pro rata share of any such payment)
pro rata based upon their respective shares, if any, of the Obligations with
respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees,
of a sum which with respect to the related sum or sums received by other Banks
is in a greater proportion than the total of such Obligation then owed and due
to such Bank bears to the total of such Obligation then owed and due to all of
the Banks immediately prior to such receipt, then such Bank receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Banks an interest in the Obligations of the respective Credit Party to
such Banks in such amount as shall result in a proportional participation by all
the Banks in such amount; provided that if all or any portion of such excess
amount is thereafter recovered from such Bank, such purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 13.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
13.07 Calculations; Computations; Accounting Terms. (a) The financial
statements to be furnished to the Banks pursuant hereto shall be made and
prepared in accordance with generally accepted accounting principles in the
United States consistently applied throughout the periods involved (except (i)
as set forth in the notes thereto, (ii) for year-end adjustments in the case of
interim financial statements and (iii) as otherwise disclosed in wri-
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ting by the Borrower to the Banks) and consistent with those used to prepare the
historical financial statements of the Borrower delivered to the Banks pursuant
to Section 7.05(a).
(b) All computations of interest, Commitment Commission and other
Fees hereunder, shall be made on the basis of a year of 360 days for the actual
number of days elapsed.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY
TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE
PROVIDED IN THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY
THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK,
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT,
THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS. THE BORROWER HEREBY FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH
COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER, AND AGREES NOT TO PLEAD OR
CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE AFOREMENTIONED COURTS, THAT SUCH
COURTS LACK PERSONAL JURISDICTION OVER THE BORROWER. THE BORROWER FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS
SET FORTH OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS
AFTER SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH
SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT
DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF ANY AGENT, ANY BANK OR THE HOLDER OF ANY NOTE
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE BORROWER IN ANY OTHER JURISDICTION.
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(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW, WAIVES AND
AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
13.10 Effectiveness. This Agreement shall become effective on the date
(the "Effective Date") on which the Borrower, the Administrative Agent, the
Syndication Agent and each of the Banks shall have signed a counterpart hereof
(whether the same or different counterparts) and shall have delivered the same
to the Administrative Agent at its Notice Office or, in the case of the Banks,
shall have given to the Administrative Agent telephonic (confirmed in writing),
written or telex notice (actually received) at such office that the same has
been signed and mailed to it. The Administrative Agent will give the Borrower
and each Bank prompt written notice of the occurrence of the Effective Date.
13.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Banks, provided that no such change, waiver, discharge or termination
shall, without the consent of each Bank (other than a Defaulting Bank) (with
Obligations being directly affected in the case of following clause (i)), (i)
extend the final scheduled maturity of any Loan or Note or extend the stated
expiration date
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of any Letter of Credit beyond the Revolving Loan Maturity Date, or reduce the
rate of interest or Fees or extend the time of payment of interest or Fees, or
reduce the principal amount thereof (except to the extent repaid in cash) (it
being understood that any amendment or modification to the financial definitions
in this Agreement or to Section 13.07(a) shall not constitute a reduction in the
rate of interest or any Fees for purposes of this clause (i)), (ii) release all
or substantially all of the Collateral (except as expressly provided in the
Credit Documents) under all the Security Documents, (iii) release a Subsidiary
Guarantor from the Subsidiaries Guaranty (except as expressly provided in the
Subsidiaries Guaranty or in connection with the sale of such Subsidiary
Guarantor in accordance with the terms of this Agreement), (iv) amend, modify or
waive any provision of this Section 13.12, (v) reduce the percentage specified
in the definition of Required Banks (it being understood that, with the consent
of the Required Banks, additional extensions of credit pursuant to this
Agreement may be included in the determination of the Required Banks on
substantially the same basis as the extensions of Term Loans and Revolving Loan
Commitments are included on the Effective Date) or (vi) consent to the
assignment or transfer by the Borrower of any of its rights and obligations
under this Agreement; provided further, that no such change, waiver, discharge
or termination shall (u) increase the Commitments of any Bank over the amount
thereof then in effect without the consent of such Bank (it being understood
that waivers or modifications of conditions precedent, covenants, Defaults or
Events of Default or of a mandatory reduction in the Total Commitments shall not
constitute an increase of the Commitment of any Bank, and that an increase in
the available portion of any Commitment of any Bank shall not constitute an
increase of the Commitment of such Bank), (v) without the consent of each
Issuing Bank, amend, modify or waive any provision of Section 2 or alter its
rights or obligations with respect to Letters of Credit, (w) without the consent
of each Agent, amend, modify or waive any provision of Section 12 or any other
provision as same relates to the rights or obligations of the Agents, (x)
without the consent of the Collateral Agent, amend, modify or waive any
provision relating to the rights or obligations of the Collateral Agent, (y)
without the consent of the Majority Banks of each Tranche which is being
allocated a lesser prepayment, repayment or commitment reduction as a result of
the actions described below (or without the consent of the Majority Banks of
each Tranche in the case of an amendment to the definition of Majority Banks),
amend the definition of Majority Banks (it being understood that, with the
consent of the Required Banks, additional extensions of credit pursuant to this
Agreement may be included in the determination of the Majority Banks on
substantially the same basis as the extensions of Term Loans and Revolving Loan
Commitments are included on the Effective Date) or alter the required
application of any prepayments or repayments (or commitment reductions), as
between the various Tranches, pursuant to Section 4.01(a) or 4.02 (excluding
Section 4.02(b)) (although the Required Banks may waive, in whole or in part,
any such prepayment, repayment or commitment reduction, so long as the
application, as amongst the various Tranches, of any such prepayment, repayment
or commitment reduction which is still required to be made is not altered) or
(z) without the consent of the Supermajority Banks of the respective Tranche,
reduce the amount of, or extend the date of, any Scheduled Repayment or without
the consent of the Supermajority Banks of each Tranche, amend the definition of
Supermajority Banks (it being understood that, with the consent of the Required
Banks,
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additional extensions of credit pursuant to this Agreement may be included in
the determination of the Supermajority Banks on substantially the same basis as
the extensions of Term Loans and Revolving Loan Commitments are included on the
Effective Date).
(b) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
clauses (i) through (vi), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Banks whose individual
consent is required are treated as described in either clauses (A) or (B) below,
to either (A) replace each such non-consenting Bank or Banks (or, at the option
of the Borrower if the respective Bank's consent is required with respect to
less than all Tranches of Loans (or related Commitments), to replace only the
respective Tranche or Tranches of Commitments and/or Loans of the respective
non-consenting Bank which gave rise to the need to obtain such Bank's individual
consent) with one or more Replacement Banks pursuant to Section 1.13 so long as
at the time of such replacement, each such Replacement Bank consents to the
proposed change, waiver, discharge or termination or (B) terminate such
non-consenting Bank's Commitments (if such Bank's consent is required as a
result of its Commitments) and/or repay outstanding Term Loans of such Bank
which gave rise to the need to obtain such Bank's consent, in accordance with
Sections 3.02(b) and/or 4.01(b), provided that, unless the Commitments that are
terminated, and Loans repaid, pursuant to preceding clause (B) are immediately
replaced in full at such time through the addition of new Banks or the increase
of the Commitments and/or outstanding Loans of existing Banks (who in each case
must specifically consent thereto), then in the case of any action pursuant to
preceding clause (B) the Required Banks (determined after giving effect to the
proposed action) shall specifically consent thereto, provided further, that in
any event the Borrower shall not have the right to replace a Bank, terminate its
Commitments or repay its Loans solely as a result of the exercise of such Bank's
rights (and the withholding of any required consent by such Bank) pursuant to
the second proviso to Section 13.12(a).
13.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01 shall survive
the execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
13.14 Domicile of Loans. Each Bank may transfer and carry its Loans
at, to or for the account of any of its Lending Offices. Notwithstanding
anything to the contrary contained herein, to the extent that a transfer of
Loans pursuant to this Section 13.14 would, at the time of such transfer, result
in increased costs under Section 1.10, 1.11, 2.06 or 4.04 from those being
charged by the respective Bank prior to such transfer, then the Borrower shall
not be obligated to pay such increased costs (although the Borrower shall be
obligated to pay any other increased costs of the type described above resulting
from changes after the date of the respective transfer).
-109-
13.15 Register. The Borrower hereby designates the Administrative
Agent to serve as the Borrower's agent, solely for purposes of this Section
13.15, to maintain a register (the "Register") on which it will record the name
and address of each Bank, the Commitments from time to time of each of the
Banks, the Loans made by each of the Banks and each repayment in respect of the
principal amount of the Loans of each Bank. Failure to make any such
recordation, or any error in such recordation shall not affect the Borrower's
obligations in respect of such Loans. With respect to any Bank, the transfer of
the Commitments of such Bank and the rights to the principal of, and interest
on, any Loan made pursuant to such Commitments shall not be effective until such
transfer is recorded on the Register maintained by the Administrative Agent with
respect to ownership of such Commitments and Loans and prior to such recordation
all amounts owing to the transferor with respect to such Commitments and Loans
shall remain owing to the transferor. The registration of assignment or transfer
of all or part of any Commitments and Loans shall be recorded by the
Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Assumption Agreement pursuant to Section 13.04(b). Coincident with the delivery
of such an Assignment and Assumption Agreement to the Administrative Agent for
acceptance and registration of assignment or transfer of all or part of a Loan,
or as soon thereafter as practicable, the assigning or transferor Bank shall
surrender the Note evidencing such Loan, and thereupon one or more new Notes in
the same aggregate principal amount shall be issued to the assigning or
transferor Bank and/or the new Bank. The Borrower agrees to indemnify the
Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Agent in performing its duties under this Section 13.15.
13.16 Confidentiality. (a) Subject to the provisions of clause (b) of
this Section 13.16, each Bank agrees that it will not disclose without the prior
consent of the Borrower (other than to its employees, auditors, advisors or
counsel or to another Bank if the Bank or such Bank's holding or parent company
in its sole discretion determines that any such party should have access to such
information, provided such Persons shall be subject to the provisions of this
Section 13.16 to the same extent as such Bank) any information with respect to
the Borrower or any of its Subsidiaries which is now or in the future furnished
pursuant to this Agreement or any other Credit Document and which is designated
by the Borrower to the Banks in writing as confidential, provided that any Bank
may disclose any such information (a) as has become generally available to the
public other than by virtue of a breach of this Section 13.16(a) by the
respective Bank, (b) as may be required or reasonably appropriate in any report,
statement or testimony submitted to any municipal, state or Federal regulatory
body having or claiming to have jurisdiction over such Bank or to the Federal
Reserve Board, the Federal Deposit Insurance Corporation, the NAIC or similar
organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required or reasonably appropriate in respect to any summons or
subpoena or in connection with any litigation, (d) in order to comply with any
law, order, regulation or ruling applicable to such Bank, (e) to the Agents and
(f) to any prospective or actual transferee or participant in connection with
any contemplated transfer or participation of any of the Notes or Commitments or
any interest therein by
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such Bank and to any direct or indirect contractual counterparties in Interest
Rate Protection Agreements or Other Hedging Agreements entered into by any Bank,
provided that such prospective transferee and each such contractual counterparty
agrees to be bound by the confidentiality provisions contained in this Section
13.16.
(b) The Borrower hereby acknowledges and agrees that each Bank may
share with any of its affiliates any information related to the Borrower or any
of its Subsidiaries (including, without limitation, any nonpublic customer
information regarding the creditworthiness of the Borrower and its Subsidiaries,
provided such Persons shall be subject to the provisions of this Section 13.16
to the same extent as such Bank).
13.17 Limitation on Increased Costs. Notwithstanding anything to the
contrary contained in Section 1.10, 1.11, 2.06 or 4.04, unless a Bank gives
notice to the Borrower that it is obligated to pay an amount under any such
Section within 180 days after the later of (x) the date such Bank incurs the
respective increased costs, Taxes, loss, expense or liability, or reduction in
amounts received or receivable or reduction in return on capital or (y) the date
such Bank has actual knowledge of its incurrence of the respective increased
costs, Taxes, loss, expense or liability, or reductions in amounts received or
receivable or reduction in return on capital, then such Bank shall only be
entitled to be compensated for such amount by the Borrower pursuant to said
Section 1.10, 1.11, 2.06 or 4.04, as the case may be, to the extent the costs,
Taxes, loss, expense or liability, or reduction in amounts received or
receivable or reduction in return on capital are incurred or suffered on or
after the date which occurs 180 days prior to such Bank giving notice to the
Borrower that it is obligated to pay the respective amounts pursuant to said
Section 1.10, 1.11, 2.06 or 4.04, as the case may be. This Section 13.17 shall
have no applicability to any Section of this Agreement or any other Credit
Document other than said Sections 1.10, 1.11, 2.06 and 4.04.
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
000 Xxxx Xxxx Xxxxxx OMNIQUIP INTERNATIONAL, INC.
Port Washington, Wisconsin 53074
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000 By /s/Xxxxxx X. Xxxxxxxx
Attention: Vice President Finance and ---------------------------
Chief Financial Officer Title: Vice President, Finance and
Chief Financial Officer
XXXXXX XXXXXXX SENIOR FUNDING,
INC., Individually and as Syndication
Agent and Arranger
By /s/Xxxxxxx Xxxx
---------------------------
Title: Vice President
FIRST UNION NATIONAL BANK,
Individually and as Administrative
Agent and Co-Arranger
By /s/Xxxxxx Xxxxxxx
---------------------------
Title: Vice President
