1
Exhibit 4.5
CONFORMED COPY
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SOVEREIGN SPECIALTY CHEMICALS, INC.
SIA ADHESIVES, INC.
XXXXXX & XXXXXXX CORP.
as Initial Borrowers
and
SUBSIDIARY GUARANTORS
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
-----------------------------
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of August 5, 1997
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CHASE SECURITIES INC.
as Arranger
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only.
Page
Section 1. Definitions and Accounting Matters............................... 2
1.01 Certain Defined Terms......................................... 2
1.02 Accounting Terms and Determinations........................... 38
1.03 Classes and Types of Loans.................................... 39
1.04 References to Date............................................ 39
Section 2. Commitments, Loans, Notes and Prepayments........................ 40
2.01 Loans......................................................... 40
2.02 Borrowings.................................................... 42
2.03 Letters of Credit............................................. 42
2.04 Changes of Commitments........................................ 49
2.05 Commitment Fee................................................ 49
2.06 Lending Offices............................................... 50
2.07 Several Obligations; Remedies Independent..................... 50
2.08 Notes......................................................... 50
2.09 Optional Prepayments and Conversions or
Continuations of Loans..................................... 51
2.10 Mandatory Prepayments and Reductions of
Commitments................................................ 52
2.11 Joint and Several Obligations................................. 59
2.12 Acquisition Loans............................................. 59
Section 3. Payments of Principal and Interest............................... 59
3.01 Repayment of Loans............................................ 59
3.02 Interest...................................................... 60
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
................................................................... 61
4.01 Payments...................................................... 61
4.02 Pro Rata Treatment............................................ 62
4.03 Computations.................................................. 62
4.04 Minimum Amounts............................................... 63
4.05 Certain Notices............................................... 63
4.06 Non-Receipt of Funds by the Administrative Agent.............. 64
4.07 Sharing of Payments, Etc...................................... 65
Section 5. Yield Protection, Etc............................................ 67
5.01 Additional Costs.............................................. 67
5.02 Limitation on Types of Loans.................................. 70
5.03 Illegality.................................................... 70
5.04 Treatment of Affected Loans................................... 71
5.05 Compensation.................................................. 71
(i)
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5.06 Additional Costs in Respect of Letters of Credit.............. 72
5.07 U.S. Taxes.................................................... 73
5.08 Replacement of Lenders........................................ 74
Section 6. Guarantee........................................................ 75
6.01 The Guarantee................................................. 75
6.02 Obligations Unconditional..................................... 76
6.03 Reinstatement................................................. 77
6.04 Subrogation................................................... 77
6.05 Remedies...................................................... 77
6.07 Continuing Guarantee.......................................... 78
6.08 Rights of Contribution........................................ 78
6.09 General Limitation on Guarantee Obligations................... 79
Section 7. Conditions Precedent............................................. 79
7.01 Effectiveness of this Agreement............................... 79
7.02 Initial and Subsequent Extensions of Credit................... 89
Section 8. Representations and Warranties................................... 90
8.01 Corporate Existence........................................... 90
8.02 Financial Condition........................................... 90
8.03 Litigation.................................................... 91
8.04 No Breach..................................................... 91
8.05 Action........................................................ 92
8.06 Approvals..................................................... 92
8.07 ERISA......................................................... 92
8.08 Taxes......................................................... 92
8.09 Investment Company Act........................................ 93
8.10 Public Utility Holding Company Act............................ 93
8.11 Material Agreements and Liens................................. 93
8.12 Environmental Matters......................................... 94
8.13 Capitalization................................................ 96
8.14 Subsidiaries, Etc............................................. 97
8.15 True and Complete Disclosure.................................. 97
8.16 Real Property................................................. 98
8.17 Certain Documents............................................. 98
8.18 Solvency...................................................... 98
Section 9. Covenants of the Obligors........................................ 99
9.01 Financial Statements Etc...................................... 99
9.02 Litigation....................................................103
9.03 Existence, Etc................................................103
9.04 Insurance.....................................................104
9.05 Prohibition of Fundamental Changes............................107
9.06 Limitation on Liens...........................................110
9.07 Indebtedness..................................................112
9.08 Investments...................................................113
9.09 Restricted Payments...........................................115
9.10 Certain Financial Covenants...................................116
9.11 Management Fees...............................................118
9.12 Capital Expenditures..........................................118
(ii)
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9.13 Holding Company...............................................118
9.14 Subordinated Indebtedness.....................................119
9.15 Lines of Business.............................................119
9.16 Transactions with Affiliates..................................119
9.17 Use of Proceeds...............................................120
9.18 Certain Obligations Respecting Restricted
Subsidiaries...............................................120
9.19 Modifications of Certain Documents............................121
9.20 Equity Issuance...............................................122
9.21 Newly-Acquired Real Property..................................122
9.22 Governmental Approvals........................................123
9.23 Appraisal............................................123
Section 10. Events of Default...............................................124
Section 11. The Administrative Agent........................................129
11.01 Appointment, Powers and Immunities...........................129
11.02 Reliance by Administrative Agent.............................130
11.03 Defaults.....................................................130
11.04 Rights as a Lender...........................................131
11.05 Indemnification..............................................131
11.06 Non-Reliance on Administrative Agent and Other
Lenders....................................................132
11.07 Failure to Act...............................................132
11.08 Resignation or Removal of Administrative Agent...............132
11.09 Consents under Other Loan Documents..........................133
Section 12. Miscellaneous...................................................134
12.01 Waiver.......................................................134
12.02 Notices......................................................134
12.03 Expenses, Etc................................................134
12.04 Amendments, Etc..............................................136
12.05 Successors and Assigns.......................................137
12.06 Assignments and Participations...............................137
12.07 Survival.....................................................140
12.08 Captions.....................................................140
12.09 Counterparts.................................................140
12.10 Governing Law; Submission to Jurisdiction....................140
12.11 Waiver of Jury Trial.........................................141
12.12 Limitation of Liability......................................141
12.13 Treatment of Certain Information;
Confidentiality............................................141
(iii)
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SCHEDULE I - Material Agreements and Liens
SCHEDULE II - Capitalization and Investments
SCHEDULE III - Real Property
SCHEDULE IV - List of Affiliate Transactions
SCHEDULE V - Environmental Matters
EXHIBIT A-1 - Form of Revolving Credit Note
EXHIBIT A-2 - Form of Term Loan Note
EXHIBIT B - Form of Borrowing Base Certificate
EXHIBIT C - Form of Security Agreement
EXHIBIT D - Form of Partnership Pledge Agreement
EXHIBIT E - Form of Confidentiality Agreement
EXHIBIT F - Form of Assignment and Acceptance
EXHIBIT G - Form of Joinder Agreement
(iv)
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AMENDED AND RESTATED CREDIT AGREEMENT dated as of August 5, 1997
between: SOVEREIGN SPECIALTY CHEMICALS, INC., a corporation duly organized and
validly existing under the laws of the State of Delaware ("SSC"); SIA ADHESIVES,
INC., a corporation duly organized and validly existing under the laws of the
State of Delaware ("SIA") and successor by merger to Sovereign Engineered
Adhesives, L.L.C., a Delaware limited liability company ("SEA"); and XXXXXX &
XXXXXXX CORP., a corporation duly organized and validly existing under the laws
of the State of New York and into which P&S (as defined below) has merged
("Xxxxxx & Xxxxxxx" and together with SSC, SIA and (after the consummation of
the Acquisition (as defined in Section 1.01 hereof) and the execution and
delivery by Evode-Xxxxxx Industries, Inc., a corporation duly organized and
validly existing under the laws of the state of New Hampshire ("Evode"), Xxxxxxx
Construction Chemicals North America, Inc., a corporation duly organized and
validly existing under the laws of the State of Illinois ("LCCNA"), and Xxxxxx
Products Company, Inc., a corporation duly organized and validly existing under
the laws of the State of New Jersey ("Xxxxxx"), of a Joinder Agreement (as
defined in Section 1.01 hereof)), Evode, LCCNA and Xxxxxx, individually a
"Borrower" and collectively, the "Borrowers"); each of the Subsidiaries of SSC
that becomes a "Guarantor" after the date hereof pursuant to Section 9.18(a)
hereof (individually, a "Guarantor" and, collectively, the "Guarantors"; the
Guarantors and the Borrowers being referred to herein as the "Obligors"); each
of the lenders that is a signatory hereto identified under the caption "LENDERS"
on the signature pages hereto and each lender that becomes a "Lender" after the
date hereof pursuant to Section 12.06(b) hereof (individually, a "Lender" and,
collectively, the "Lenders"); and THE CHASE MANHATTAN BANK, a New York banking
corporation, as administrative agent for the Lenders (in such capacity, together
with its successors in such capacity, the "Administrative Agent").
WHEREAS, Sovereign Specialty Chemicals, L.P., a Delaware limited
partnership (the "Partnership"), SIA and Xxxxxx & Xxxxxxx (the "Existing
Borrowers"), certain of the Lenders (the "Existing Lenders") and the
Administrative Agent are parties to a Credit Agreement dated as of August 19,
1996 (as heretofore modified and supplemented and in effect on the date hereof
immediately before giving effect to the amendment and restatement contemplated
hereby, the "Existing Credit Agreement"). Pursuant to the Existing Credit
Agreement, (a) certain of the Existing Lenders committed to make revolving
credit loans to the Existing Borrowers in an original aggregate principal amount
not exceeding $15,000,000 at any one time outstanding, with a portion of such
commitments made available for the issuance of letters of credit in an aggregate
amount not exceeding $5,000,000 at any one time
Credit Agreement
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outstanding and (b) certain of the Existing Lenders committed to make term loans
to the Existing Borrowers in an original aggregate principal amount not
exceeding $25,000,000.
WHEREAS, the Borrowers have requested that the Existing Lenders
(which include all of the Persons that on the date hereof are Lenders under, and
as defined in, the Existing Credit Agreement) and the Administrative Agent agree
to amend and restate the Existing Credit Agreement in its entirety, and the
Existing Lenders and the Administrative Agent are willing to amend and restate
the Existing Credit Agreement in its entirety, in order to, among other things,
(a) cause the Borrowers to be the joint and several borrowers thereunder and
cause the Guarantors to be the joint and several guarantors thereunder, (b)
increase the aggregate amount of the commitments to make revolving credit loans
to $30,000,000 and (c) reinstate the commitments to make term loans and increase
the aggregate amount thereof to $30,000,000.
NOW, THEREFORE, the parties hereto hereby agree that the Existing
Credit Agreement shall be amended and restated as of the date hereof (but
subject to Section 7.01) to read in its entirety as follows:
Accordingly, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the following terms
shall have the following meanings (all terms defined in this Section 1.01 or in
other provisions of this Agreement in the singular to have the same meanings
when used in the plural and vice versa):
"ABR Loans" shall mean Loans that bear interest at rates based upon
the ABR Rate.
"ABR Rate" shall mean, for any day, a rate per annum equal to the
highest of (a) the Federal Funds Rate for such day plus 1/2 of 1%, (b) the Prime
Rate for such day and (c) the Base CD Rate for such day plus 1%. Each change in
any interest rate provided for herein based upon the ABR Rate resulting from a
change in the ABR Rate shall take effect at the time of such change in the ABR
Rate.
"Acquisition" shall mean the acquisition by the Partnership and SSC,
in accordance with the Acquisition Documents, of all outstanding shares of
capital stock of the
Credit Agreement
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Target Companies, immediately followed by the contribution by the Partnership to
SSC of all such shares so acquired by the Partnership.
"Acquisition Agreement" shall mean the Stock Purchase Agreement
dated as of May 22, 1997 between Xxxxxxx, as seller, and the Partnership and
SSC, as buyers, as amended by that certain Closing Agreement as of August 5,
1997, as the same shall, subject to Section 9.19 hereof, be further modified and
supplemented and in effect from time to time.
"Acquisition Documents" shall mean the Acquisition Agreement and the
documents referred to in the Schedules thereto.
"Acquisition Loan" has the meaning assigned to such term in Section
2.01(b) hereof.
"Acquisition Loan Availability Period" has the meaning assigned to
such term in Section 2.01(b) hereof.
"Administrative Agent" has the meaning assigned to such term in the
heading hereof.
"Affiliate" shall mean, with respect to any Person (the "First
Person") any other Person (the "Other Person") that directly or indirectly
controls, or is under common control with, or is controlled by, such First
Person and, if such Other Person is an individual, any member of the immediate
family (including parents, spouse, children and siblings) of such individual and
any trust whose principal beneficiary is such individual or one or more members
of such immediate family and any Person who is controlled by any such member or
trust. As used in this definition, "control" (including, with its correlative
meanings, "controlled by" and "under common control with") shall mean
possession, directly or indirectly, of power to direct or cause the direction of
management or policies (whether through ownership of securities or partnership
or other ownership interests, by contract or otherwise), provided that, in any
event, any Person that owns directly or indirectly securities having 5% or more
of the voting power for the election of directors or other governing body of a
corporation or 5% or more of the partnership or other ownership interests of any
other Person (other than as a limited partner of such other Person) will be
deemed to control such corporation or other Person. Notwithstanding the
foregoing, (a) no individual (and no member of the immediate family (including
parents, spouse, children and siblings) of any individual or any trust whose
principal beneficiary is such individual or one or more members of such
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immediate family and no Person who is controlled by any such member or trust)
shall be an Affiliate of SSC or any of its Subsidiaries solely by reason of such
individuals being a director, officer or employee of a Borrower, the
Partnership, any Partner, any shareholder of any Partner or any Subsidiary of
any of the foregoing Persons, (b) no Restricted Subsidiaries that are Wholly
Owned Subsidiaries of a Borrower shall be Affiliates of SSC or any of its
Restricted Subsidiaries and (c) no Lender and no affiliate of any Lender shall
be an Affiliate of SSC or any of its Restricted Subsidiaries.
"Applicable Lending Office" shall mean, for each Lender and for each
Type of Loan, the "Lending Office" of such Lender (or of an affiliate of such
Lender) designated for such Type of Loan on the signature pages hereof or such
other office of such Lender (or of an affiliate of such Lender) as such Lender
may from time to time specify to the Administrative Agent and the Borrowers as
the office by which its Loans of such Type are to be made and maintained.
"Applicable Rate" shall mean: (a) with respect to ABR Loans, 1.250%
per annum; (b) with respect to Eurodollar Loans, 2.500% per annum; (c) with
respect to commitment fees, 0.500%; and (d) with respect to letter of credit
fees, 2.500%; provided that if the Pricing Ratio as at the last day of any
fiscal quarter of SSC ending on or after September 30, 1997 shall fall within
any of the ranges set forth below then, subject to the delivery to the
Administrative Agent of a certificate of a Senior Officer demonstrating such
fact prior to the end of the next succeeding fiscal quarter, the "Applicable
Rate" for each such item shall be reduced to the rate for such item set forth
below opposite such range during the period commencing on the Quarterly Date on
or immediately following the date of receipt of such certificate to but not
including the next succeeding Quarterly Date thereafter (except that
notwithstanding the foregoing, the Applicable Rate for any such Loan shall not
as a consequence of this proviso be so reduced for any period during which an
Event of Default shall have occurred and be continuing):
Credit Agreement
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================================================================================
Pricing Ratio ABR Loans Eurodollar Commitment Letter of
Loans Fees Credit
Fees
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Less than 3.0 0.250 1.500 0.375 1.500
to 1
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Greater than or 1.750 0.375 1.750
equal to 3.0 to
1 and less than 0.500
3.5 to 1
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Greater than or 2.000 0.375 2.000
equal to 3.5 to
1 and less than 0.750
4.0 to 1
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Greater than or 2.250 0.500 2.250
equal to 4.0 to
1 and less than 1.000
4.5 to 1
--------------------------------------------------------------------------------
Greater than or 1.250 2.500 0.500 2.500
equal to 4.5 to
1
================================================================================
"Assessment Rate" shall mean, for any Interest Period, the average
of the highest and lowest annual assessment rates (determined by the
Administrative Agent as at the first day of such Interest Period and rounded
upwards, if necessary, to the nearest 1/100 of 1%) that the Federal Deposit
Insurance Corporation (or any successor) charges members of the Bank Insurance
Fund pursuant to 12 C.F.R. Part 327 (or any successor) for such Corporation's
(or such successor's) insuring time deposits at offices of such members in the
United States of America.
"BAIC/MIG Stock Purchase Agreement" shall mean the BAIC/MIG Stock
Purchase Agreement dated as of August 19, 1996 among SCC, BankAmerica Investment
Corporation and MIG Partners II, as the same shall, subject to Section 9.19
hereof, be modified and supplemented and in effect from time to time.
"BAIC/MIC Unit Purchase Agreement" shall mean the BAIC/MIG Unit
Purchase Agreement dated as of August 19, 1996 among the Partnership,
BankAmerica Investment Corporation and MIG
Credit Agreement
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Partners II, as the same shall, subject to Section 9.19 hereof, be modified and
supplemented and in effect from time to time.
"Bankruptcy Code" shall mean the Federal Bankruptcy Code of 1978, as
amended from time to time.
"Base CD Rate" means the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of which is one
and the denominator of which is one minus the Reserve Requirement and (b) the
Assessment Rate.
"Basle Accord" shall mean the proposals for risk-based capital
framework described by the Basle Committee on Banking Regulations and
Supervisory Practices in its paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988, as amended, modified
and supplemented and in effect from time to time or any replacement thereof.
"Borrowers" has the meaning assigned to such term in the heading
hereof.
"Borrowing Base" shall mean, as at any date, the sum of (a) 85% of
the aggregate amount of Eligible Receivables (other than Eligible Foreign
Receivables) as at the date (the "Base Date") covered by the Borrowing Base
Certificate received by the Administrative Agent on or most recently prior to
such date plus (b) 75% of the aggregate amount of Eligible Foreign Receivables
as at the Base Date plus (c) 50% of the aggregate value of Eligible Inventory as
at the Base Date, provided that in no event shall the portion of the Borrowing
Base attributable to Eligible Inventory exceed 50% of the Borrowing Base and the
Borrowing Base shall be reduced by the amount of the excess to the extent such
portion would otherwise exceed 50%. The "value" of Eligible Inventory shall be
determined at the lower of cost or market in accordance with GAAP, except that
cost shall be determined on a first-in-first-out basis.
"Borrowing Base Certificate" shall mean a certificate of a Senior
Officer, substantially in the form of Exhibit B hereto and appropriately
completed.
"Business Day" shall mean any day (a) on which commercial banks are
not authorized or required to close in New York City or Illinois, (b) if such
day relates to a borrowing of, a payment or prepayment of principal of or
interest on, a Conversion of or into, or an Interest Period for, a Eurodollar
Loan or a notice by the Borrowers with respect to any such borrowing, payment,
prepayment, Conversion or Interest Period,
Credit Agreement
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that is also a day on which dealings in Dollar deposits are carried out in the
London interbank market and (c) if such day relates to the determination of the
Dollar Equivalent of any amount denominated in a currency other than Dollars,
that is also a day on which the London foreign exchange market settles payments
in such other currency.
"Capital Expenditures" shall mean, for any period, expenditures
(including, without limitation, the aggregate amount of Capital Lease
Obligations incurred during such period) made by SSC or any of its Restricted
Subsidiaries (including the Target Companies prior to the Restatement Effective
Date) to acquire or construct fixed assets, plant and equipment (including
renewals, improvements and replacements, but excluding repairs) during such
period computed in accordance with GAAP; provided that the term "Capital
Expenditures" shall not include expenditures made in connection with
acquisitions permitted by Section 9.05(d) or 9.05(e) hereof.
"Capital Lease Obligations" shall mean, for any Person, all
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP, and, for purposes of this
Agreement, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP.
"Casualty Event" shall mean, with respect to any Property of any
Person, any loss of or damage to, or any condemnation or other taking of, such
Property for which such Person or any of its Restricted Subsidiaries receives
insurance proceeds, or proceeds of a condemnation award or other compensation.
"Casualty-Related Reserved Commitment Amount" shall have the meaning
assigned to such term in Section 2.01(a) hereof.
"Change of Control" shall mean any of the following events:
(i) prior to any Qualifying Public Offering, either (a) the failure
by the Controlling Partners, the Lenders and the affiliates of the Lenders
to own, directly or indirectly, more than 50% of the financial and
management controlling interests in the Partnership, (b) any Partner shall
xxxxx x Xxxx on its partnership interest in the Partnership in
contravention of the Investors Agreement or
Credit Agreement
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(c) any Person other than the Partnership shall own any capital stock of
SSC,
(ii) after any Qualifying Public Offering, any Person or group of
related Persons (within the meaning of Section 13(d) of the Securities
Exchange Act of 1934, as amended) (other than the Partnership, the
Controlling Partners, the Lenders and the affiliates of the Lenders) shall
own, directly or indirectly, 25% or more of the financial or management
controlling interests in SSC, or
(iii) a "Change of Control" under and as defined in the Senior
Subordinated Debt Documents.
"Chase" shall mean The Chase Manhattan Bank, a New York banking
corporation.
"Class" shall have the meaning assigned to such term in Section 1.03
hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral Account" shall have the meaning assigned to such term in
Section 4.01 of the Security Agreement.
"Commitments" shall mean the Revolving Credit Commitments and the
Term Loan Commitments.
"Contingent Repurchase Obligations" shall mean obligations to
purchase, redeem, retire or otherwise acquire from any individual that is an
officer or employee of the Partnership, SSC or any Restricted Subsidiary of SSC
any capital stock issued by, or partnership interest (whether general or
limited) or other similar equity interest in the Partnership, SSC or any
Restricted Subsidiary of SSC and held by such individual, which obligations
shall become owing (whether or not then due and payable) upon the death or
disability of such individual or upon the termination of employment of such
individual by the Partnership or any of its Subsidiaries.
"Continue", "Continuation" and "Continued" shall refer to the
continuation pursuant to Section 2.09 hereof of a Eurodollar Loan from one
Interest Period to the next Interest Period.
"Controlling Partners" shall mean First Chicago Equity Corporation,
Cross Creek Partners, Waud Capital Partners, L.L.C.,
Credit Agreement
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Waud Capital Partners-I, L.P., Waud Capital Partners-II, L.P., Xxxxxx Xxxxxx,
Xxxxxxx Xxxxxx, and the Affiliates of the aforementioned Persons.
"Convert", "Conversion" and "Converted" shall refer to a conversion
pursuant to Section 2.09 hereof of one Type of Loans into the other Type of
Loans, which may be accompanied by the transfer by a Lender (at its sole
discretion) of a Loan from one Applicable Lending Office to another.
"Credit Exposure" shall mean, with respect to any Lender, the
aggregate unutilized amount of the Commitments of such Lender, the aggregate
outstanding principal amount of all Loans made by such Lender and the aggregate
amount of Letter of Credit Liabilities of such Lender.
"Credit Parties" shall mean the Obligors and the Partnership.
"Credit-Supported Receivable" shall mean a Receivable to the extent
that the payment thereof is Guaranteed under a letter of credit issued for
account of the related account debtor by a Lender or by a bank with a combined
capital and surplus of at least $500,000,000, or insured by Export-Import Bank
of the United States of America or Overseas Private Investment Corporation or by
American International Group Inc or a Subsidiary thereof.
"Debt Issuance" shall mean the creation, issuance or incurrence by
SSC or any of its Restricted Subsidiaries after the Restatement Effective Date
of Subordinated Indebtedness.
"Debt Service" shall mean, for any period, the sum, for SSC and its
Restricted Subsidiaries (determined on a consolidated basis without duplication
in accordance with GAAP), of the following: (a) all regularly scheduled payments
or prepayments of principal of Indebtedness (excluding prepayments under Section
2.09 or 2.10 hereof, but including, without limitation, the principal component
of any payments in respect of Capital Lease Obligations) made or required to be
made during such period plus (b) all Interest Expense for such period.
"Deductible Reserves" shall mean, with respect to any Disposition,
reasonable and customary reserves established by SSC or a Restricted Subsidiary
to cover direct or contingent obligations incurred or undertaken in connection
with such Disposition as certified by SSC to the Administrative Agent at the
time of such Disposition.
Credit Agreement
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"Default" shall mean an Event of Default or an event that with
notice or lapse of time or both would become an Event of Default.
"Disposition" shall mean any sale, assignment, transfer or other
disposition of any Property (whether now owned or hereafter acquired) by SSC or
any of its Restricted Subsidiaries to any other Person excluding any sale,
assignment, transfer or other disposition of any Property sold or disposed of to
any Obligor or in the ordinary course of business and on ordinary business
terms.
"Disposition-Related Reserved Commitment Amount" shall have the
meaning assigned to such term in Section 2.01(a) hereof.
"Dollar Equivalent" shall mean, on any date of determination, with
respect to any amount (the "Non-Dollar Amount") denominated in a currency other
than Dollars, the amount of Dollars that would be required to purchase the
Non-Dollar Amount on such date based upon the spot selling rate at which Chase
offers to sell such Non-Dollar Amount for Dollars in the London foreign exchange
market at approximately 11:00 a.m. London time for delivery two Business Days
later.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"EBITDA" shall mean, for any period, the sum, for SSC and its
Restricted Subsidiaries (determined on a consolidated basis without duplication
in accordance with GAAP), of the following: (a) net operating income (calculated
before taxes or payments made in lieu of taxes, Interest Expense, extraordinary
and unusual items) for such period plus (b) depletion, depreciation,
amortization and other non-cash charges and expenses (to the extent deducted in
determining net operating income) for such period, plus (c) transaction costs
and expenses incurred in connection with the Acquisition and the closing of the
other transactions and permitted acquisitions contemplated hereby (to the extent
deducted in determining net operating income) for such period minus (d) (except
to the extent deducted in calculating net operating income) Management Fees paid
during such period; provided that in no event shall Management Fees referred to
in the last sentence of Section 9.11 of the Existing Credit Agreement be
deducted in calculating net operating income or by operation of the preceding
clause (d). If at any time during such period SSC or any of its Restricted
Subsidiaries shall have made an acquisition of a business (other than the
Acquisition), EBITDA for such period shall be calculated after
Credit Agreement
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giving pro forma effect to such acquisition as if such acquisition occurred on
the first day of such period.
"Eligible Foreign Country" shall mean Australia, Canada, New
Zealand, Japan, South Korea, Taiwan, Malaysia, Thailand, Singapore or a member
country of the European Union.
"Eligible Foreign Receivables" shall mean Eligible Receivables
(other than Credit-Supported Receivables) owing by an account debtor whose
principal place of business is in an Eligible Foreign Country.
"Eligible Inventory" shall mean, as at any date, the sum of the
following (determined without duplication) all Inventory (i) that is owned by
(and (except to the extent provided in the last sentence of this definition) in
the possession or under the control of) the Obligors as at such date, (ii) that
is located in a jurisdiction in the United States of America, (iii) as to which
appropriate Uniform Commercial Code financing statements have been filed naming
such Obligor as "debtor" and the Administrative Agent as "secured party", (iv)
that is in good condition, (v) that meets all standards imposed by any
governmental agency or department or division thereof having regulatory
authority over such Inventory, its use or sale and (vi) that is either currently
usable or currently saleable in the normal course of such Obligor's business
without any notice to, or consent of, any governmental agency or department or
division thereof (excluding however, except to the extent that the Majority
Lenders otherwise agree with respect to any specific customer, any such
Inventory that has been shipped to a customer of such Obligor on a consignment
or "sale or return" basis); provided that in no event shall Inventory that is
unmarketable be "Eligible Inventory". Inventory that would otherwise be Eligible
Inventory but for the parenthetical subclause of clause (i) above shall not be
excluded from Eligible Inventory solely because it has been shipped to a
customer, provided that the aggregate amount of such Inventory may not exceed
20% of the Eligible Inventory; and Inventory that would otherwise be Eligible
Inventory but for clause (ii) above shall not be excluded from Eligible
Inventory solely because it is not located in a jurisdiction in the United
States of America, provided that the aggregate amount of such Inventory may not
exceed 20% of the Eligible Inventory.
"Eligible Receivables" shall mean, as at any date, the aggregate
amount of all Receivables at such date payable to any Obligor as to which
appropriate Uniform Commercial Code financing statements have been filed naming
such Obligor as "debtor" and
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the Administrative Agent as "secured party", other than the following
(determined without duplication):
(a) any Receivable not payable in Dollars or in any other freely
convertible currency,
(b) any Receivable that, at the date of issuance of the invoice
therefor, was payable more than 60 days (or, in the case of any Receivable
owing from an account debtor whose principal place of business is located
outside of the United States of America, 90 days) after shipment of the
related Inventory,
(c) any Receivable owing from a Subsidiary or Affiliate of such
Obligor,
(d) the amount of any Receivable (other than a Credit-Supported
Receivable) owing from an account debtor whose principal place of business
is located outside of the United States of America as may be necessary
such that (i) the Receivables (other than Credit-Supported Receivables)
owing from such account debtor and its Affiliates at the time would not
exceed 3-1/2% of all Eligible Receivables then payable to the Obligors and
(ii) the Receivables (other than Credit-Supported Receivables) owing by
all account debtors whose principal place of business is located outside
of the United States of America and their Affiliates would not exceed 30%
of all Eligible Receivables then payable to the Obligors (provided that
Eligible Receivables shall in any event not include any Receivable (other
than Credit-Supported Receivables) owing by any account debtor whose
principal place of business is not in the United States or an Eligible
Foreign Country),
(e) any Receivable that remains unpaid for more than 120 days after
the date of the issuance of the original invoice therefor,
(f) all Receivables of any account debtor if more than 25% of the
aggregate amount of the Receivables owing from such account debtor shall
at the time have remained unpaid for more than 120 days after the date of
the issuance of the original invoices therefor,
(g) the amount, if any, of Receivables owing from any account debtor
(other than General Motors Corporation, Ford Motor Company, Chrysler
Corporation, The Boeing Company or their respective Subsidiaries) as may
be necessary such that
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the Receivables owing from such account debtor and its Affiliates at the
time would not exceed 7% of all Eligible Receivables then payable to the
Obligors,
(h) any Receivable as to which there is any unresolved dispute with
the respective account debtor (but only to the extent of the amount
thereof in dispute),
(i) any Receivable evidenced by an Instrument (as defined in the
Security Agreement) not in the possession of the Administrative Agent, and
(j) any Receivable representing an obligation for goods sold on
consignment, approval or a sale-or-return basis or subject to any other
repurchase or return arrangement.
"Environmental Claim" shall mean, with respect to any Person, any
written or oral notice, claim, demand or other communication (collectively, a
"claim") by any other Person alleging or asserting such Person's liability for
investigatory costs, cleanup costs, governmental response costs, damages to
natural resources or other Property, personal injuries, fines or penalties
arising out of, based on or resulting from (i) the presence, or Release into the
environment, of any Hazardous Material at any location, whether or not owned by
such Person, or (ii) circumstances forming the basis of any violation, or
alleged violation, of any Environmental Law. The term "Environmental Claim"
shall include, without limitation, any claim by any governmental authority for
enforcement, cleanup, removal, response, remedial or other actions or damages
pursuant to any applicable Environmental Law, and any claim by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the presence of Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the environment.
"Environmental Laws" shall mean any and all present and future
Federal, state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the regulation
or protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the indoor or outdoor
environment, including, without limitation, ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
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disposal, transport or handling of pollutants, contaminants, chemicals or toxic
or hazardous substances or wastes.
"Environmental Reports" shall mean the environmental assessments
referred to in Section 7.01(k) hereof.
"Equity Documents" shall mean, collectively, (i) the Stock Purchase
and Exchange Agreement, dated as July 31, 1997, by and among the General
Partner, the purchasers listed on Schedule I thereto and the management
employees listed on Schedule II thereto, as the same shall, subject to Section
9.19 hereof, be modified and supplemented and in effect from time to time, (ii)
the Partnership Unit Purchase and Exchange Agreement, dated as of July 31, 1997,
by and among the Partnership, the purchasers listed on Schedule I thereto and
the management employees listed on Schedule II thereto, as the same shall,
subject to Section 9.19 hereof, be modified and supplemented and in effect from
time to time, (iii) the Investors Agreement, (iv) the Partnership Agreement, (v)
Contribution Agreement, dated as July 31, 1997, by the General Partner as the
same shall, subject to Section 9.19 hereof, be modified and supplemented and in
effect from time to time, (vi) the Stock Subscription and Contribution
Agreement, dated as of July 31, 1997, between the Partnership and SSC, as the
same shall, subject to Section 9.19 hereof, be modified and supplemented and in
effect from time to time, (vii) the Purchase Agreement, dated as of July 31,
1997, between the Class A Common Stock Partnership and SSC, as the same shall,
subject to Section 9.19 hereof, be modified and supplemented and in effect from
time to time, (viii) BAIC/MIG Stock Purchase Agreement and (ix) the BAIC/MIC
Unit Purchase Agreement.
"Equity Issuance" shall mean (a) any issuance or sale by SSC or any
of its Restricted Subsidiaries after the Restatement Effective Date of (i) any
of its partnership interests (whether as a general or a limited partner),
membership interests or capital stock, (ii) any warrants or options exercisable
in respect of any of its partnership interests (whether as a general or a
limited partner), membership interests or capital stock (other than any warrants
or options issued to directors, officers or employees of SSC or any of its
Restricted Subsidiaries exercisable in respect of partnership interests in the
Partnership pursuant to employee benefit plans established in the ordinary
course of business and any partnership interests in the Partnership issued upon
the exercise of such warrants or options) or (iii) any other security or
instrument representing an equity interest (or the right to obtain any equity
interest) in SSC or any of its Restricted Subsidiaries or (b) the receipt
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by SSC or any of its Restricted Subsidiaries after the Restatement Effective
Date of any capital contribution (whether or not evidenced by any equity
security issued by the recipient of such contribution); provided that Equity
Issuance shall not include (x) any such issuance or sale by a Restricted
Subsidiary of a Borrower to a Borrower or any Restricted Subsidiary that is a
Wholly Owned Subsidiary of a Borrower, (y) any capital contribution by a
Borrower or any Restricted Subsidiary that is a Wholly Owned Subsidiary of a
Borrower to any Restricted Subsidiary of such Borrower or (z) any such issuance
(other than a Qualifying Public Offering) required by any Transaction Document
as in effect on the date hereof.
"Equity Rights" shall mean, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including, without limitation, any stockholders' or voting trust
agreements) for the issuance, sale, registration or voting of, or securities
convertible into, any additional shares of capital stock of any class, or
partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade or business
that is a member of any group of organizations (i) described in Section 414(b)
or (c) of the Code of which any Obligor is a member and (ii) solely for purposes
of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11)
of the Code and the lien created under Section 302(f) of ERISA and Section
412(n) of the Code, described in Section 414(m) or (o) of the Code of which any
Obligor is a member.
"Escrowed Funds" shall mean the "Environmental Escrowed Funds" as
defined in the Purchase Agreement dated as of August 19, 1996 among The
Xxxxxxx-Xxxxxxxx Company, Xxxxxx & Xxxxxxx, the Partnership and P&S, as in
effect on the date hereof.
"Eurodollar Loans" shall mean Loans that bear interest at rates
based on rates referred to in the definition of "Eurodollar Rate" in this
Section 1.01.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Loan
for any Interest Period therefor, the rate per annum quoted by Chase
approximately 11:00 a.m. London time (or as soon thereafter as practicable) on
the date two Business Days
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prior to the first day of such Interest Period for the offering by Chase to
leading banks in the London interbank market of Dollar deposits having a term
comparable to such Interest Period and in an amount comparable to the principal
amount of the Eurodollar Loan to be made by Chase for such Interest Period. If
Chase is not participating in any Eurodollar Loans during any Interest Period
therefor, the Eurodollar Rate for such Loans for such Interest Period shall be
determined by reference to deposits in the amount of $5,000,000.
"Event of Default" shall have the meaning assigned to such term in
Section 10 hereof.
"Evode" shall mean Evode-Xxxxxx Industries, Inc., a New Hampshire
corporation.
"Excess Cash Flow" shall mean, for any fiscal year of SSC (the
"Applicable Year"), the excess of (a) the sum of EBITDA for such Applicable Year
plus non-cash credits included in calculating EBITDA in a fiscal year of SSC
preceding such Applicable Year that are paid in cash in such fiscal year over
(b) the sum (without duplication) of (i) Capital Expenditures and acquisitions
made during such Applicable Year and cash consideration paid by SSC and its
Restricted Subsidiaries for permitted acquisitions in such Applicable Year
(other than Capital Expenditures financed by the incurrence of Indebtedness)
plus (ii) the aggregate amount of Debt Service for such Applicable Year plus
(iii) the amount (the "Carry Forward Amount") of Capital Expenditures permitted
to have been made, but not made, during such Applicable Year under the first
sentence of Section 9.12 hereof and permitted to be made in the following fiscal
year of SSC minus (iv) the Carry Forward Amount from the preceding fiscal year
of SSC not used as Capital Expenditures in such Applicable Year plus (v)
Restricted Payments made during such Applicable Year by any Obligor plus (vi)
any increase (or minus any decrease) in Working Capital from the first to the
last day of such period plus (viii) taxes paid in cash by SSC and its Restricted
Subsidiaries for such Applicable Year plus (ix) non-cash charges deducted in
calculating EBITDA in a fiscal year of SSC preceding such Applicable Year that
are paid in cash in such fiscal year plus (x) non-cash credits included in
calculating EBITDA in such Applicable Year plus (xi) to the extent not already
deducted in the determination of EBITDA for such period, the aggregate amount of
cash payments in respect of incentive compensation and earn-out and similar
arrangements made during such period, plus (xii) the Net Available Proceeds of
any Disposition included in determining EBITDA for such period. All calculations
relating to the Target Companies for purposes of
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determining Excess Cash Flow for the fiscal year of SSC ending December 31, 1997
shall be for the period commencing on the Restatement Effective Date and ending
December 31, 1997.
"Exchange Securities Indenture" shall have the meaning assigned to
such term in the Registration Rights Agreement, as such Exchange Securities
Indenture shall, subject to Section 9.19 hereof, be modified and supplemented
and in effect from time to time.
"Existing Borrowers" shall have the meaning assigned to such term in
the recitals hereto.
"Existing Credit Agreement" shall have the meaning assigned to such
term in the recitals hereto.
"Existing Lenders" shall have the meaning assigned to such term in
the recitals hereto.
"Existing Letters of Credit" shall mean letters of credit issued
hereunder prior to the Restatement Effective Date that are outstanding on the
Restatement Effective Date.
"Existing Subordinated Debt" shall mean the Indebtedness of the
Borrowers and the Guarantors under the Senior Subordinated Note, Stock and Unit
Purchase Agreement dated as of August 19, 1996 among SSC, the Existing
Borrowers, the General Partner, Bank of America Illinois, BankAmerica Investment
Corporation and MIG Partners II, the promissory notes evidencing Indebtedness
thereunder substantially in the form of Exhibit A thereto and the guarantees of
such Indebtedness issued by Guarantors substantially in the form of Exhibit K
thereto.
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, provided that (a) if the day for which such rate is to
be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate charged to Chase on such Business Day on such
transactions as determined by the Administrative Agent.
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"Final Maturity Date" shall mean the seventh anniversary of the
Restatement Effective Date, or, if such anniversary is not a Business Day, the
Business Day preceding such anniversary.
"Foreign Companies" shall mean (i) Xxxxxx & Xxxxxxx Holding
Corporation de Mexico S.A. de C.V., Xxxxxx & Xxxxxxx de Mexico S.A. de C.V. and
Xxxxxx & Xxxxxxx Corporation S.A. de C.V., each of which is organized under the
laws of Mexico and (ii) Sovereign Specialty Chemicals (SPte. Ltd), which is
organized under the laws of Singapore.
"GAAP" shall mean generally accepted accounting principles applied
on a basis consistent with those that, in accordance with the last sentence of
Section 1.02(a) hereof, are to be used in making the calculations for purposes
of determining compliance with this Agreement.
"General Partner" shall mean the general partner of the Partnership.
"Guarantee" shall mean a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall
have a correlative meaning.
"Guarantor" has the meaning assigned to such term in the heading
hereof.
"Hazardous Material" shall mean, collectively, (a) any petroleum or
petroleum products, flammable materials, explosives, radioactive materials,
asbestos, urea formaldehyde foam insulation, and transformers or other equipment
that contain polychlorinated biphenyls ("PCB's"), (b) any chemicals or other
materials or substances that are now or hereafter become defined
Credit Agreement
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as or included in the definition of "hazardous substances", "hazardous wastes",
"hazardous materials", "extremely hazardous wastes", "restricted hazardous
wastes", "toxic substances", "toxic pollutants", "contaminants", "pollutants" or
words of similar import under any Environmental Law and (c) any other chemical
or other material or substance, exposure to which is now or hereafter
prohibited, limited or regulated under any Environmental Law.
"Hedging Agreement" shall mean, for any Person, a swap, cap or
collar agreement, hedge, exchange or similar protection arrangement between such
Person and one or more financial institutions providing for the transfer or
mitigation of interest risks, foreign currency exchange fluctuations or
fluctuations in prices of commodity chemicals either generally or under specific
contingencies.
"Holding Company" shall mean a Person whose sole material Properties
consist of capital stock of, or partnership or membership interests and/or other
equity interests in, one or more Subsidiaries of SSC.
"Indebtedness" shall mean, for any Person: (a) obligations created,
issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of Property to another Person
subject to an understanding or agreement, contingent or otherwise, to repurchase
such Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than trade
accounts payable (other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business so long as such trade accounts
payable are payable within 90 days of the date the respective goods are
delivered or the respective services are rendered; (c) Indebtedness of others
secured by a Lien on the Property of such Person, whether or not the respective
indebtedness so secured has been assumed by such Person; (d) Capital Lease
Obligations of such Person; and (e) Indebtedness of others Guaranteed by such
Person.
"Interest Coverage Ratio" shall mean, as at any date, the ratio of
(i) the sum of (a) EBITDA (excluding the portion attributable to the Target
Companies) for the period of four fiscal quarters of SSC ending on or most
recently ended prior to such date and (b) the product of the portion of EBITDA
attributable to the Target Companies for the Relevant Period for such date
multiplied by a fraction the numerator of which is 365 and the denominator of
which is the number of days in such
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Relevant Period to (ii) Interest Expense for such Relevant Period.
"Interest Expense" shall mean, for any period, the sum, for SSC and
its Restricted Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of the following: (a) all interest in
respect of Indebtedness (including, without limitation, the interest component
of any payments in respect of Capital Lease Obligations) accrued or capitalized
during such period (whether or not actually paid during such period) plus (b)
the net amount payable (or minus the net amount receivable) under Hedging
Agreements relating to interest during such period (whether or not actually paid
or received during such period).
If at any time during such period SSC or any of its Restricted
Subsidiaries shall have made an acquisition (whether by merger or otherwise)
financed with Indebtedness, such acquisition shall, for the purposes of
calculating Interest Expense, be deemed to have occurred on the first day of
such period, and Interest Expense for such period shall be calculated as if the
interest rate applicable to such Indebtedness were, throughout such period equal
to Loans made from time to time under this Agreement throughout such period (or
if a senior financial officer can demonstrate to the reasonable satisfaction of
the Majority Lenders that a different interest rate should be used for such
purpose, such different rate).
"Interest Period" shall mean, with respect to any Eurodollar Loan,
each period commencing on the date such Eurodollar Loan is made or Converted
from an ABR Loan or (in the event of a Continuation) the last day of the next
preceding Interest Period for such Loan and ending on the numerically
corresponding day in the first or second or (subject to the provisions of
Section 2.01(c) hereof) third or sixth calendar month thereafter, as the
Borrowers may select as provided in Section 4.05 hereof, except that each
Interest Period that commences on the last Business Day of a calendar month (or
on any day for which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall end on the last Business Day of the
appropriate subsequent calendar month.
Notwithstanding the foregoing: (i) if any Interest Period for any
Revolving Credit Loan would otherwise end after the Revolving Credit Commitment
Termination Date, such Interest Period shall end on the Revolving Credit
Commitment Termination Date; (ii) no Interest Period for any Term Loans may
commence before and end after any Principal Payment Date unless, after
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giving effect thereto, the aggregate principal amount of the Term Loans having
Interest Periods that end after such Principal Payment Date shall be equal to or
less than the aggregate principal amount of the Term Loans scheduled to be
outstanding after giving effect to the payments of principal required to be made
on such Principal Payment Date; (iii) each Interest Period that would otherwise
end on a day that is not a Business Day shall end on the next succeeding
Business Day (or, if such next succeeding Business Day falls in the next
succeeding calendar month, on the next preceding Business Day); and (iv)
notwithstanding clause (i) and (ii) above, no Interest Period shall have a
duration of less than one month and, if the Interest Period for any Eurodollar
Loan would otherwise be a shorter period, such Loan shall not be available
hereunder for such period.
"Inventory" shall mean specialty chemical products and related
products and other readily marketable materials, including raw materials, of a
type manufactured, sold or consumed by the Obligors in the ordinary course of
business.
"Investment" shall mean, for any Person: (a) the acquisition
(whether for cash, Property, services or securities or otherwise) of capital
stock, bonds, notes, debentures, partnership or other ownership interests or
other securities of any other Person or any agreement to make any such
acquisition (including, without limitation, any "short sale" or any sale of any
securities at a time when such securities are not owned by the Person entering
into such sale); (b) the making of any deposit with, or advance, loan or other
extension of credit to, any other Person (including the purchase of Property
from another Person subject to an understanding or agreement, contingent or
otherwise, to resell such Property to such Person), but excluding any such
advance, loan or extension of credit having a term not exceeding 90 days arising
in connection with the sale of inventory or supplies by such Person in the
ordinary course of business; (c) the entering into of any Guarantee of, or other
contingent obligation with respect to, Indebtedness or other liability of any
other Person and (without duplication) any amount committed to be advanced, lent
or extended to such Person; or (d) the entering into of any Hedging Agreement.
"Investors Agreement" shall mean the Amended and Restated Investors
Agreement dated as of August 19, 1996, as amended as of October 7, 1996 and as
of July 31, 1997, among the General Partner, the Partnership and each of the
investors party thereto, as the same shall, subject to Section 9.19 hereof, be
modified and supplemented and in effect from time to time.
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"IPO" shall mean an initial public offering of any capital stock,
partnership interests or other similar equity interests by SSC, the Partnership
or the General Partner.
"Issuance-Related Reserved Commitment Amount" shall have the meaning
assigned to such term in Section 2.01(a) hereof.
"Issuing Bank" shall mean Chase, as the issuer of Letters of Credit
under Section 2.03 hereof, together with its successors and assigns in such
capacity.
"Joinder Agreement" shall mean a Joinder Agreement substantially in
the form of Exhibit G hereto among the Target Companies and the Administrative
Agent.
"Laporte" shall mean Xxxxxxx Inc., a Delaware corporation.
"LCCNA" shall mean Laporte Construction Chemicals North America,
Inc., an Illinois corporation.
"Lender" has the meaning assigned to such term in the heading
hereof.
"Letters of Credit" shall have the meaning assigned to such term in
Section 2.03 hereof, and shall include the Existing Letters of Credit.
"Letter of Credit Documents" shall mean, with respect to any Letter
of Credit, collectively, any application therefor and any other agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to such
Letter of Credit or (b) any collateral security for any of such obligations,
each as the same may be modified and supplemented and in effect from time to
time.
"Letter of Credit Interest" shall mean, for each Revolving Credit
Lender, such Lender's participation interest (or, in the case of the Issuing
Bank, the Issuing Bank's retained interest) in the Issuing Bank's liability
under Letters of Credit and such Lender's rights and interests in Reimbursement
Obligations and fees, interest and other amounts payable in connection with
Letters of Credit and Reimbursement Obligations.
"Letter of Credit Liability" shall mean, without duplication, at any
time and in respect of any Letter of Credit,
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the sum of (a) the undrawn face amount of such Letter of Credit plus (b) the
aggregate unpaid principal amount of all Reimbursement Obligations of the
Borrowers at such time due and payable in respect of all drawings made under
such Letter of Credit. For purposes of this Agreement, a Revolving Credit Lender
(other than the Issuing Bank) shall be deemed to hold a Letter of Credit
Liability in an amount equal to its participation interest in the related Letter
of Credit under Section 2.03 hereof, and the Issuing Bank shall be deemed to
hold a Letter of Credit Liability in an amount equal to its retained interest in
the related Letter of Credit after giving effect to the acquisition by the
Revolving Credit Lenders other than the Issuing Bank of their participation
interests under said Section 2.03.
"Leverage Ratio" shall mean, as at any date, the ratio of (i) the
aggregate principal amount of all Indebtedness of SSC and its Restricted
Subsidiaries on such date (calculated on a consolidated basis in accordance with
GAAP) to (ii) the sum of (a) EBITDA (excluding the portion thereof attributable
to the Target Companies) for the period of four fiscal quarters of SSC ending on
or most recently ended prior to such date and (b) the product of the portion of
EBITDA attributable to the Target Companies for the Relevant Period for such
date multiplied by a fraction the numerator of which is 365 and the denominator
of which is the number of days in such Relevant Period.
"Lien" shall mean, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Agreement and the other Loan Documents, a Person
shall be deemed to own subject to a Lien any Property that it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement (other than an
operating lease) relating to such Property.
"Limited Partners" shall mean the limited partners of the
Partnership.
"Loan Documents" shall mean, collectively, this Agreement, the
Notes, the Letter of Credit Documents, the Security Documents and the Joinder
Agreement.
"Loans" shall mean the Revolving Credit Loans and the Term Loans.
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"Majority Lenders" shall mean Lenders holding more than 50% of the
Credit Exposures of all of the Lenders, as calculated at the time of
determination.
"Majority Revolving Credit Lenders" shall mean Revolving Credit
Lenders having more than 50% of the aggregate amount of the Revolving Credit
Commitments or, if the Revolving Credit Commitments shall have terminated,
Lenders holding more than 50% of the sum of (a) the aggregate unpaid principal
amount of the Revolving Credit Loans plus (b) the aggregate amount of all Letter
of Credit Liabilities.
"Majority Term Lenders" shall mean Term Loan Lenders holding more
than 50% of the aggregate outstanding principal amount of the Term Loans or, if
the Term Loans shall not have been made, more than 50% of the Term Loan
Commitments.
"Management Fees" shall mean, for any period, the sum of all fees,
salaries and other compensation paid or incurred by SSC or any of its Restricted
Subsidiaries to any of its Affiliates (other than Affiliates that are employees
of SSC or any of its Restricted Subsidiaries) in respect of services rendered in
connection with the management or supervision of SSC and its Restricted
Subsidiaries, or any of them, plus all out-of-pocket expenses incurred by the
Manager or any Affiliate of SSC on behalf of SSC and its Restricted Subsidiaries
during such period in connection with the operation of the business of SSC and
its Restricted Subsidiaries.
"Management Notes" shall have the meaning assigned to such term in
Section 7.01(o) hereof.
"Manager" shall mean the General Partner.
"Material Adverse Effect" shall mean a material adverse effect on
(a) the Transactions, (b) the Property, business, operations, financial
condition, prospects, liabilities or capitalization of SSC and its Restricted
Subsidiaries taken as a whole, (c) the ability of any Obligor to perform its
obligations under any of the Loan Documents to which it is a party, (d) the
validity or enforceability of any of the Loan Documents, (e) the rights and
remedies of the Lenders and the Administrative Agent under any of the Loan
Documents or (f) the timely payment of the principal of or interest on the Loans
or the Reimbursement Obligations or other amounts payable in connection
therewith.
"Xxxxxx" shall mean Xxxxxx Products Company, Inc., a New Jersey
corporation.
Credit Agreement
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"Xxxxxx Disposition" shall mean the Disposition by SSC or any of its
Restricted Subsidiaries of all of the capital stock of Xxxxxx or the Disposition
by Xxxxxx of all or substantially all of its Properties.
"Mortgages" shall mean one or more instruments of mortgage,
assignment of rents, security agreement and fixture filing executed by SSC or
one of its Restricted Subsidiaries in favor of the Administrative Agent and the
Lenders, executed and delivered to the Administrative Agent prior to the date
hereof or pursuant to Section 7.01(i) of this Agreement and covering the
respective Properties and leasehold interests, identified therein (but in any
event excluding leases of office space or warehouses which do not include ground
leases), as such instruments shall be modified and supplemented and in effect
from time to time including without limitation (in the case of Mortgages
executed and delivered pursuant to the Existing Credit Agreement) by operation
of the Mortgage Amendments.
"Mortgage Amendments" shall mean instruments satisfactory to the
Administrative Agent in form and substance amending those Mortgages that were
executed and delivered to the Administrative Agent prior to the date hereof
pursuant to the Existing Credit Agreement.
"Multiemployer Plan" shall mean a multiemployer plan defined as such
in Section 3(37) of ERISA, if any, to which contributions have been made by the
Obligors or any ERISA Affiliate and that is covered by Title IV of ERISA.
"Net Available Proceeds" shall mean:
(i) in the case of any Disposition, the amount of Net Cash Payments
received in connection with such Disposition net of amounts expended to
replace the Property that was the subject of such Disposition;
(ii) in the case of any Casualty Event, the aggregate amount of
proceeds of insurance, condemnation awards and other compensation received
by SSC and its Restricted Subsidiaries in respect of such Casualty Event
net of (A) reasonable expenses incurred by SSC and its Restricted
Subsidiaries in connection therewith, (B) contractually required
repayments of Indebtedness to the extent secured by a Lien on such
Property and any income and transfer taxes payable by SSC or any of its
Restricted Subsidiaries in respect of such Casualty Event and
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(C) amounts expended to repair or replace the Property that was the
subject of such Casualty Event; and
(iii) in the case of any Debt Issuance or Equity Issuance, the
aggregate amount of all cash received by SSC and its Restricted
Subsidiaries in respect of such Debt Issuance or Equity Issuance net of
reasonable expenses incurred by SSC and its Restricted Subsidiaries in
connection therewith.
"Net Cash Payments" shall mean, with respect to any Disposition, the
aggregate amount of all cash payments, including any cash payments received by
way of deferred payment of principal pursuant to a note or installment
receivable or otherwise, received by SSC and its Restricted Subsidiaries
directly or indirectly in connection with such Disposition; provided that (a)
Net Cash Payments shall be net of (i) the amount of any legal, title and
recording tax expenses, commissions and other fees and expenses paid by SSC and
its Restricted Subsidiaries in connection with such Disposition and (ii) any
Federal, state and local income or other taxes estimated to be payable by SSC
and its Restricted Subsidiaries as a result of such Disposition (but only to the
extent that such estimated taxes are in fact paid to the relevant Federal, state
or local governmental authority within three months of the date such taxes are
due) and (b) Net Cash Payments shall be net of any repayments by SSC or any of
its Restricted Subsidiaries of Indebtedness to the extent that (i) such
Indebtedness is secured by a Lien on the Property that is the subject of such
Disposition and (ii) the transferee of (or holder of a Lien on) such Property
requires that such Indebtedness be repaid as a condition to the purchase of such
Property.
"Net Worth" shall mean, as at any date for any Person, the sum for
such Person and its Restricted Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP), of the following:
(a) the amount of capital stock, paid in capital and paid in
membership interests (excluding the cost of treasury shares or other
similar equity interests); plus
(b) the amount of surplus and retained earnings (or, in the case of
a surplus or retained earnings deficit, minus the amount of such deficit).
"Notes" shall mean the Revolving Credit Notes and the Term Loan
Notes.
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"Obligor" has the meaning assigned to such term in the heading
hereof.
"P&S" has the meaning assigned to such term in the heading hereof.
"Partners" shall mean the General Partner and the Limited Partners.
"Partnership" has the meaning assigned to such term in the recitals
hereto.
"Partnership Agreement" shall mean the Agreement of Limited
Partnership dated as of March 31, 1996, as amended as of August 19, 1996, and as
of October 7, 1996 and as of July 31, 1997, by and among the Partners, as the
same shall, subject to Section 9.19 hereof, be modified and supplemented and in
effect from time to time.
"Partnership Pledge Agreement" shall mean an Amended and Restated
Pledge Agreement substantially in the form of Exhibit D hereto between the
Partnership and the Administrative Agent, as the same shall be modified and
supplemented and in effect from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Investments" shall mean: (a) direct obligations of the
United States of America, or of any agency thereof, or obligations guaranteed as
to principal and interest by the United States of America, or of any agency
thereof, in either case maturing not more than six months from the date of
acquisition thereof; (b) bankers' acceptances, time deposits, demand deposits
and certificates of deposit accepted by, placed with or issued either by a
Lender or by any bank or trust company organized under the laws of the United
States of America or any state thereof and having capital, surplus and undivided
profits of at least $500,000,000, and maturing not more than six months from the
date of acquisition thereof; (c) commercial paper rated A-1 or better or P-1 by
Standard & Poor's Ratings Services, a Division of The XxXxxx-Xxxx Companies,
Inc., or Xxxxx'x Investors Services, Inc., respectively, maturing not more than
90 days from the date of acquisition thereof; in each case so long as the same
(x) provide for the payment of principal and interest (and not principal alone
or interest alone) and (y) are not subject to any contingency regarding the
payment of principal or interest;
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(d) investments in repurchase agreements (or reverse repurchase agreements)
covering other Permitted Investments with financial institutions that are
elected primary government securities dealers by the Federal Reserve Board or
whose securities are rated AA- or better by Standard & Poor's Ratings Services,
a Division of The XxXxxx-Xxxx Companies, Inc., or Aa or better by Xxxxx'x
Investors Service, Inc.; (e) money-market funds or money-market mutual funds
that (i) seek to maintain a constant net asset value, (ii) maintain fund assets
under management having an aggregate market value of at least $500,000,000, and
(iii) invest primarily in Investments referred to in clauses (a) through (d)
above; and (f) direct obligations of foreign governmental entities or foreign
banks rated AA- or better by Standard & Poor's Ratings Services, a Division of
The XxXxxx-Xxxx Companies, Inc. or Aa or better by Xxxxx'x Investors Services,
Inc.
"Person" shall mean any individual, corporation, company, voluntary
association, partnership, limited liability company, joint venture, trust,
unincorporated organization or government (or any agency, instrumentality or
political subdivision thereof).
"Xxxxxx & Xxxxxxx" has the meaning assigned to such term in the
heading hereof.
"Plan" shall mean an employee benefit or other plan established or
maintained by any Obligor or any ERISA Affiliate and that is covered by Title IV
of ERISA, other than a Multiemployer Plan.
"Post-Default Rate" shall mean a rate per annum equal to 2.0% plus
the ABR Rate as in effect from time to time plus the Applicable Rate for ABR
Loans, provided that, with respect to principal of a Eurodollar Loan that shall
become due (whether at stated maturity, by acceleration, by optional or
mandatory prepayment or otherwise) on a day other than the last day of the
Interest Period therefor, the "Post-Default Rate" shall be, for the period from
and including such due date to but excluding the last day of such Interest
Period, 2.0% plus the interest rate for such Loan as provided in Section 3.02(b)
hereof and, thereafter, the rate provided for above in this definition.
"Pricing Ratio" shall mean, as at any date, the ratio of (i) the
aggregate principal amount of all Indebtedness of SSC and its Restricted
Subsidiaries on such date (calculated on a consolidated basis in accordance with
GAAP) to (ii) the sum of (a) EBITDA (excluding the portion thereof attributable
to the Target Companies) for the period of four fiscal quarters of SSC
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ending on or most recently ended prior to such date and (b) the product of the
portion of EBITDA attributable to the Target Companies for the Relevant Period
for such date multiplied by a fraction the numerator of which is 365 and the
denominator of which is the number of days in such Relevant Period.
"Prime Rate" shall mean the rate of interest from time to time
announced by Chase at the Principal Office as its prime commercial lending rate.
"Principal Office" shall mean the principal office of Chase located
on the date hereof at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Principal Payment Dates" shall mean (i) the Quarterly Dates falling
on or nearest to March 31, June 30, September 30 and December 31 of each year,
commencing with September 30, 1998 through and including June 30, 2004 and (ii)
the Final Maturity Date.
"Property" shall mean any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Qualifying Public Offering" shall mean an underwritten primary
public offering of common stock of SSC pursuant to an effective registration
statement filed under the Securities Act of 1933, as amended (excluding
registration statements filed on Form S-8) which results in at least 15% of the
total issued and outstanding common stock of SSC having been distributed by
means of such registration statement.
"Quarterly Dates" shall mean the last Business Day of each March,
June, September, and December, the first of which shall be the first such day
after the date hereof.
"Receivables" shall mean, as at any date, the unpaid portion of the
obligation, as stated on the respective invoice, of a customer of the Obligors
in respect of Inventory sold and shipped by such Obligor to such customer, net
of any credits, rebates or offsets owed to such customer and also net of any
commissions payable to third parties (and for purposes hereof, a credit or
rebate paid by check or draft of the Obligors shall be deemed to be outstanding
until such check or draft shall have been debited to the account of such Obligor
on which such check or draft was drawn).
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"Registration Rights Agreement" shall mean the Registration Rights
Agreement dated August 5, 1997 among Chase Securities Inc., Xxxxxxxxx, Xxxxxx &
Xxxxxxxx Securities Corporation and SSC, as the same shall, subject to Section
9.19 hereof, be modified and supplemented and in effect from time to time.
"Regulations A, D, G, T, U and X" shall mean, respectively,
Regulations A, D, G, T, U and X of the Board of Governors of the Federal Reserve
System (or any successor), as the same may be modified and supplemented and in
effect from time to time.
"Regulatory Change" shall mean, with respect to any Lender, any
change after the date hereof in Federal, state or foreign law or regulations
(including, without limitation, Regulation D) or the adoption or making after
such date of any interpretation, directive or request applying to a class of
banks including such Lender of or under any Federal, state or foreign law or
regulations (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"Reimbursement Obligations" shall mean, at any time, the obligations
of the Borrowers then outstanding, or that may thereafter arise in respect of
all Letters of Credit then outstanding, to reimburse amounts paid by the Issuing
Bank in respect of any drawings under a Letter of Credit.
"Release" shall mean any release, spill, emission, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the environment, including, without limitation, the movement of Hazardous
Materials through ambient air, soil, surface water, ground water, wetlands, land
or subsurface strata, but excluding, without limitation, any spill, discharge or
release of a Hazardous Material into a containment structure or onto an
impermeable surface.
"Relevant Period" shall mean, with respect to any date, the period
of four fiscal quarters of SSC ending on or most recently ended prior to such
date, excluding any portion of such period falling before the Restatement
Effective Date.
"Reserve Requirement" shall mean, for any Interest Period for any
Eurodollar Loan, the average maximum rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required to be
maintained
Credit Agreement
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during such Interest Period under Regulation D by member banks of the Federal
Reserve System in New York City with deposits exceeding one billion Dollars
against (a) in the case of Eurodollar Loans, "Eurocurrency liabilities" (as such
term is used in Regulation D) and (b) for purposes of calculating the Base CD
Rate, non-personal Dollar time deposits in an amount of $100,000 or more.
Without limiting the effect of the foregoing, the Reserve Requirement shall
include any other reserves required to be maintained by such member banks by
reason of any Regulatory Change with respect to (i) any category of liabilities
that includes deposits by reference to which the Eurodollar Rate or the Base CD
Rate (as the case may be) is to be determined as provided in the definitions of
"Eurodollar Rate" and "Base CD Rate" in this Section 1.01 or (ii) any category
of extensions of credit or other assets that includes Eurodollar Loans or ABR
Loans.
"Restatement Effective Date" shall mean the date on which the
conditions to effectiveness set forth in Section 7.01 hereof shall have been
satisfied or waived.
"Restricted Payment" shall mean, with respect to any Person, all
dividends or partnership distributions (in cash, Property or obligations) on, or
other payments or distributions on account of, or the setting apart of money for
a sinking or other analogous fund for, or the purchase, redemption, retirement
or other acquisition of, any shares of any class of capital stock of such Person
or any portion of any partnership interest (whether general or limited) in such
Person or of any warrants, options or other rights to acquire the same (or to
make any payments to any Person, such as "phantom stock" payments, where the
amount thereof is calculated with reference to fair market or equity value of
SSC or its Restricted Subsidiaries, or any of them), but excluding (i)
Management Fees and (ii) dividends payable solely in shares of common stock of
such Person.
"Restricted Subsidiary" shall mean each Subsidiary of SSC that is
not an Unrestricted Subsidiary.
"Revolving Credit Commitment" shall mean, as to each Revolving
Credit Lender, the obligation of such Lender to make Revolving Credit Loans, and
to issue or participate in Letters of Credit pursuant to Section 2.03 hereof, in
an aggregate principal or face amount at any one time outstanding up to but not
exceeding the amount set opposite the name of such Lender on the signature pages
hereof under the caption "Revolving Credit Commitment" or, in the case of a
Person that becomes a Revolving Credit Lender pursuant to an assignment
permitted under
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Section 12.06(b) hereof, as specified in the respective instrument of assignment
pursuant to which such assignment is effected (as the same may be reduced from
time to time pursuant to Section 2.04 or 2.10 hereof). The original aggregate
amount of the Revolving Credit Commitments is $30,000,000.
"Revolving Credit Commitment Percentage" shall mean, with respect to
any Revolving Credit Lender, the ratio of (a) the amount of the Revolving Credit
Commitment of such Lender to (b) the aggregate amount of the Revolving Credit
Commitments of all of the Lenders.
"Revolving Credit Commitment Termination Date" shall mean the Final
Maturity Date.
"Revolving Credit Lenders" shall mean (a) on the date hereof, the
Lenders having Revolving Credit Commitments on the signature pages hereof and
(b) thereafter, the Lenders from time to time holding Revolving Credit Loans,
Revolving Credit Commitments or Letter of Credit Interests after giving effect
to any assignments thereof permitted by Section 12.06(b) hereof.
"Revolving Credit Loans" shall have the meaning assigned to such
term in Section 2.01(a) hereof and shall include the revolving credit loans made
hereunder prior to the Restatement Effective Date that remain outstanding at the
opening of business on the Restatement Effective Date.
"Revolving Credit Notes" shall mean the promissory notes provided
for by Section 2.08(a) hereof and all promissory notes delivered in substitution
or exchange therefor, in each case as the same shall be modified and
supplemented and in effect from time to time.
"SCC" shall mean Sovereign Chemicals Corporation, a Delaware
corporation.
"SEA" shall have the meaning assigned to such term in the heading
hereof.
"Security Agreement" shall mean an Amended and Restated Security
Agreement substantially in the form of Exhibit C hereto between the Obligors and
the Administrative Agent, as the same shall be modified and supplemented and in
effect from time to time.
"Security Documents" shall mean, collectively, the Security
Agreement, the Partnership Pledge Agreement, the
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Mortgages, the Mortgage Amendments, all Uniform Commercial Code financing
statements required by the Security Agreement, the Partnership Pledge Agreement,
the Mortgages or the Mortgage Amendments to be filed with respect to the
security interests in personal Property and fixtures created pursuant to the
Security Agreement, the Partnership Pledge Agreement, the Mortgages or the
Mortgage Amendments, and all other documents executed and delivered by any of
the Obligors in favor of the Administrative Agent for the benefit of the Lenders
creating a Lien on any or all of their respective Properties.
"Seller Subordinated Note" shall mean the Junior Subordinated Note
issued by the Partnership in an original principal amount equal to $3,000,000
under, and in accordance with, the Acquisition Agreement, as the same shall,
subject to Section 9.19 hereof, be modified and supplemented and in effect from
time to time.
"Senior Officer" shall mean the president or chief financial officer
of SSC.
"Senior Subordinated Notes" shall mean (i) notes issued by SSC under
the Senior Subordinated Notes Indenture in the original aggregate principal
amount not exceeding $125,000,000 and (ii) notes issued in exchange for such
notes under the Exchange Securities Indenture, in each of the cases referred to
in the foregoing clauses (i) and (ii), as the same shall, subject to Section
9.19 hereof, be modified and supplemented and in effect from time to time.
"Senior Subordinated Notes Documents" shall mean the Senior
Subordinated Notes, the Registration Rights Agreement, the Senior Subordinated
Notes Indenture and the Exchange Securities Indenture.
"Senior Subordinated Notes Indebtedness" shall mean the Indebtedness
of the Obligors under the Senior Subordinated Notes Documents.
"Senior Subordinated Notes Indenture" shall mean the Indenture dated
as of August 5, 1997 among SSC, the "Guarantors" referred to therein and The
Bank of New York, as trustee, as the same shall, subject to Section 9.19 hereof,
be modified and supplemented and in effect from time to time.
"SIA" shall have the meaning assigned to such term in the heading
hereof.
Credit Agreement
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"Significant Group of Restricted Subsidiaries" shall mean two or
more Restricted Subsidiaries of SSC (other than any Foreign Company) that would
constitute a Significant Restricted Subsidiary if their assets and operations
were combined in accordance with GAAP. References in Section 10 hereof to any
event or condition in respect of a Significant Group of Restricted Subsidiaries
shall be deemed to refer to one or more of such events or conditions in respect
of each of the Restricted Subsidiaries that are included in such Significant
Group of Restricted Subsidiaries and shall not be construed to mean a single
such event or condition that applies jointly to all of such Subsidiaries.
"Significant Restricted Subsidiary" shall mean, as at any date of
determination, a Restricted Subsidiary of SSC (other than a Foreign Company)
that either had revenues of at least $2,000,000 for the period of four fiscal
quarters of such Restricted Subsidiary ending on or most recently ended prior to
such date or had assets (valued at the higher of fair market value or book
value) of at least $1,000,000 as at the last day of such period.
"SSC" has the meaning assigned to such term in the heading hereof.
"Subordinated Debt Documents" shall mean the Senior Subordinated
Notes Documents and the Seller Subordinated Note.
"Subordinated Indebtedness" shall mean, collectively, (a) the Senior
Subordinated Notes Indebtedness, (b) the Seller Subordinated Note and (c)
unsecured Indebtedness of the Obligors that is subordinated to the obligations
of the Obligors to pay principal of and interest on the Loans, Reimbursement
Obligations and Notes hereunder, and to the obligations of the Obligors under
Hedge Agreements with Lenders, on terms, and pursuant to documentation
containing other terms (including interest, amortization, covenants and events
of default), in form and substance reasonably satisfactory to the Majority
Lenders.
"Subsidiary" shall mean, with respect to any Person, any
corporation, partnership or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership or other entity
(irrespective of whether or not at the time securities or other ownership
interests of any other class or classes of such corporation, partnership or
other entity shall have or might have
Credit Agreement
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voting power by reason of the happening of any contingency) is at the time
directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.
"Supplemental Acquisition Loan Commitment Termination Date" shall
mean the date falling 24 months after the Restatement Effective Date.
"Target Companies" shall mean (i) LCCNA, (ii) Xxxxxx and (iii)
Evode.
"Tax Payment Amount" shall mean, for any Partner (including, without
limitation, any Partner in its or his capacity, as a member of SEA during the
period prior to the Restatement Effective Date) or any member of SEA, for any
period, an amount not exceeding in the aggregate the amount of Federal, state
and local income taxes that would be payable by such Partner or member in
respect of income of SSC and its Subsidiaries for such period (including,
without limitation, income of SEA during the period prior to the Restatement
Effective Date) at a rate equal to the actual highest combined marginal Federal,
state and local income tax rates (after giving effect to the deductibility of
state and local income taxes) applicable to any of the Partners (or to any
investors in any of the Partners) or any of such members, provided that (i) the
aggregate amount of the Tax Payment Amount for all periods attributable to all
of the Partners (or to any investors in any of the Partners) shall not exceed
$250,000 in respect of their respective ownership interests in SEA and (ii) the
aggregate amount of the Tax Payment Amount for such period attributable to
Unrestricted Subsidiaries shall not exceed the aggregate amount of dividends
paid in cash by the Unrestricted Subsidiaries and received by SSC and its
Restricted Subsidiaries during such period.
"Term Loan Commitment" shall mean, as to each Term Loan Lender, the
obligation of such Lender to make a Term Loan in a principal amount up to but
not exceeding the amount set opposite the name of such Lender on the signature
pages hereof under the caption "Term Loan Commitment" or, in the case of a
Person that becomes a Term Loan Lender pursuant to an assignment permitted under
Section 12.06(b) hereof, as specified in the respective instrument of assignment
pursuant to which such assignment is effected (as the same may be reduced from
time to time pursuant to Section 2.04 or 2.10 hereof). The original aggregate
amount of the Term Loan Commitments is $30,000,000.
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"Term Loan Commitment Termination Date" shall mean August 22, 1997.
"Term Loan Notes" shall mean the promissory notes provided for by
Section 2.08(b) hereof and all promissory notes delivered in substitution or
exchange therefor, in each case as the same shall be modified and supplemented
and in effect from time to time.
"Term Loans" shall have meaning assigned to such term in Section
2.01(b) hereof and shall include the term loans made hereunder prior to the
Restatement Effective Date remain outstanding at the opening of business on the
Restatement Effective Date.
"Term Loan Lenders" shall mean (a) on the date hereof, the Lenders
having Term Loan Commitments on the signature pages hereof and (b) thereafter,
the Lenders from time to time holding Term Loans and Term Loan Commitments after
giving effect to any assignments thereof permitted by Section 12.06(b) hereof.
"Three-Month Secondary CD Rate" means, for any day, the secondary
market rate for three-month certificates of deposit reported as being in effect
on such day (or, if such day is not a Business Day, the next preceding Business
Day) by the Board of Governors of the Federal Reserve System through the public
information telephone line of the Federal Reserve Bank of New York (which rate
will, under the current practices of the Board, be published in Federal Reserve
Statistical Release H.15(519) during the week following such day), or, if such
rate is not so reported, the average (rounded upwards to the nearest 1/100 of
1%) of the secondary market quotations for three-month certificates of deposit
of major money center banks in New York city received at approximately 10:00
a.m., New York City time, on such day or the next preceding Business Day by the
Administrative Agent from three New York City negotiable certificate of deposit
dealers of recognized standing selected by it.
"Transaction Documents" shall mean the Loan Documents, the
Acquisition Documents, the Equity Documents and the Subordinated Debt Documents.
"Transactions" means the following transactions, all to be
consummated substantially simultaneously on the Restatement Effective Date: (i)
the Acquisition, (ii) the issuance by SSC of the Senior Subordinated Notes under
the Senior Subordinated Notes Indenture, (iii) the borrowing and prepayment
referred to in Section 2.01(c) hereof, (iv) the redemption and repayment in full
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of the Existing Subordinated Debt, (v) the exchange by the shareholders of SIA
(other than the Partnership) of their capital in SIA for stock of the General
Partner and partnership interests in the Partnership, (vi) the exchange by the
shareholders of Xxxxxx & Xxxxxxx (other than the Partnership) of their stock in
Xxxxxx & Xxxxxxx for stock of the General Partner and partnership interest in
the Partnership, (vii) the issuance by the Partnership and the General Partner
of $36,000,000 of equity, (viii) the contribution by the General Partner to the
Partnership of all of its stock in SIA and Xxxxxx & Xxxxxxx, (ix) the issuance
by SSC of its capital stock to the Partnership pursuant to the Equity Documents,
(x) the contribution by the Partnership to SSC of $33,800,000 in cash and all of
its stock in SIA and Xxxxxx & Xxxxxxx, and (xi) the contribution by the
Partnership to SSC of the Management Notes.
"Type" shall have the meaning assigned to such term in Section 1.03
hereof.
"Unrestricted Subsidiary" shall mean a Subsidiary of SSC designated
as such by SSC in a notice to the Administrative Agent and to which designation
the Majority Lenders have consented in a notice to SSC.
"U.S. Person" shall mean a citizen or resident of the United States
of America, a corporation, partnership or other entity created or organized in
or under any laws of the United States of America or any State thereof, or any
estate or trust that is subject to U.S. Federal income taxation regardless of
the source of its income.
"U.S. Taxes" shall mean any present or future tax, assessment or
other charge or levy imposed by or on behalf of the United States of America or
any taxing authority thereof.
"Wholly Owned Subsidiary" shall mean, with respect to any Person,
any corporation, partnership or other entity of which all of the equity
securities or other ownership interests (other than, in the case of a
corporation, directors' qualifying shares) are directly or indirectly owned or
controlled by such Person or one or more Wholly Owned Subsidiaries of such
Person or by such Person and one or more Wholly Owned Subsidiaries of such
Person.
"Working Capital" shall mean, as at such date, the sum for SSC and
its Restricted Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP) of the following: (a) current assets minus
(b) current
Credit Agreement
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liabilities (excluding the current portion of long term debt and of any
installments of principal payable hereunder).
1.02 Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein, all accounting
terms used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to the
Lenders hereunder shall (unless otherwise disclosed to the Lenders in writing at
the time of delivery thereof in the manner described in subsection (b) below) be
prepared, in accordance with generally accepted accounting principles applied on
a basis consistent with those used in the preparation of the latest financial
statements furnished to the Lenders hereunder. All calculations made for the
purposes of determining compliance with this Agreement shall (except as
otherwise expressly provided herein) be made by application of generally
accepted accounting principles applied on a basis consistent with those used in
the preparation of the latest annual or quarterly financial statements furnished
to the Lenders pursuant to Section 9.01 hereof unless (i) SSC shall have
objected to determining such compliance on such basis at the time of delivery of
such financial statements or (ii) the Majority Lenders shall so object in
writing within 30 days after delivery of such financial statements, in either of
which events such calculations shall be made on a basis consistent with those
used in the preparation of the latest financial statements as to which such
objection shall not have been made.
(b) SSC shall deliver to the Lenders at the same time as the
delivery of any annual or quarterly financial statement under Section 9.01
hereof (i) a description in reasonable detail of any material variation between
the application of accounting principles employed in the preparation of such
statement and the application of accounting principles employed in the
preparation of the next preceding annual or quarterly financial statements as to
which no objection has been made in accordance with the last sentence of
subsection (a) above and (ii) reasonable estimates of the difference between
such statements arising as a consequence thereof.
(c) To enable the ready and consistent determination of compliance
with the covenants set forth in Section 9 hereof, SSC will not change the last
day of its fiscal year from December 31, or the last days of the first three
fiscal quarters in each of its fiscal years from March 31, June 30 and September
30 of each year, respectively.
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(d) Except as otherwise expressly provided herein, all financial
statements and certificates and reports as to financial matters required to be
delivered to the Administrative Agent or the Lenders hereunder shall be
prepared, and all calculations made for purposes of determining compliance with
the terms hereof shall be made, as if the Unrestricted Subsidiaries were carried
as equity investments by SSC and its Restricted Subsidiaries; provided that:
(i) earnings and other increases in the value of Unrestricted
Subsidiaries shall not increase earnings of SSC and its Restricted
Subsidiaries for purposes of determining EBITDA until received by SSC or a
Restricted Subsidiary in cash;
(ii) the value of equity investments in any Unrestricted Subsidiary
shall not be increased except to reflect the book value of any assets
subsequently contributed thereto by SSC and its Restricted Subsidiaries,
such book value in the case of any asset to be determined as of the date
of its contribution; and
(iii) losses and other decreases of value of the Unrestricted
Subsidiaries, when recognized by the respective Unrestricted Subsidiaries,
shall, at the time of such recognition, decrease the value of equity
investments in Unrestricted Subsidiaries held by SSC and its Restricted
Subsidiaries, but shall not decrease the earnings of SSC and its
Restricted Subsidiaries for purposes of determining EBITDA.
1.03 Classes and Types of Loans. Loans hereunder are distinguished
by "Class" and by "Type". The "Class" of a Loan (or of a Commitment to make a
Loan) refers to whether such Loan is a Revolving Credit Loan or a Term Loan,
each of which constitutes a Class. The "Type" of a Loan refers to whether such
Loan is a ABR Loan or a Eurodollar Loan, each of which constitutes a Type. Loans
may be identified by both Class and Type.
1.04 References to Date. All references herein to "the date hereof"
and the "the date of this Agreement", and similar references, shall mean August
5, 1997.
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Section 2. Commitments, Loans, Notes and Prepayments.
2.01 Loans.
(a) Revolving Credit Loans. Each Revolving Credit Lender severally
agrees, on the terms and conditions of this Agreement, to make loans to the
Borrowers in Dollars during the period from and including the Restatement
Effective Date to but not including the Revolving Credit Commitment Termination
Date in an aggregate principal amount at any one time outstanding up to but not
exceeding the amount of the Revolving Credit Commitment of such Lender as in
effect from time to time (such loans being herein called "Revolving Credit
Loans"), provided that in no event shall the aggregate principal amount of all
Revolving Credit Loans plus the aggregate amount of all Letter of Credit
Liabilities exceed the lesser of the Borrowing Base or the aggregate amount of
the Revolving Credit Commitments of all of the Revolving Credit Lenders as in
effect from time to time. Subject to the terms and conditions of this Agreement,
during such period the Borrowers may borrow, repay and reborrow the amount of
the Revolving Credit Commitments by means of ABR Loans and Eurodollar Loans and
may Convert Revolving Credit Loans of one Type into Revolving Credit Loans of
the other Type (as provided in Section 2.09 hereof) or Continue Revolving Credit
Loans that are Eurodollar Loans from one Interest Period into another Interest
Period (as provided in Section 2.09 hereof).
Proceeds of Revolving Credit Loans shall be available for any use
permitted under Section 9.17 hereof, provided that, in the event that as
contemplated by Section 2.10(b), 2.10(c) or 2.10(e) hereof, the Borrowers shall
prepay Revolving Credit Loans from the Net Available Proceeds of a Casualty
Event, a Debt Issuance, an Equity Issuance or a Disposition hereunder, then an
amount of Revolving Credit Commitments equal to the amount of such prepayment
(herein the "Casualty-Related Reserved Commitment Amount", in the case of a
Casualty Event, the "Issuance-Related Reserved Commitment Amount", in the case
of a Debt Issuance or Equity Issuance or the "Disposition-Related Reserved
Commitment Amount", in the case of Disposition) shall be reserved and shall not
be available for borrowings hereunder except and to the extent that the proceeds
of such borrowings are to be applied (i) to repair or replace the Property that
was the subject of the related Casualty Event or to make prepayments of Loans
under Section 2.10(b)(y)(B) hereof, in the case of the Casualty-Related Reserved
Commitment Amount, (ii) to make acquisitions permitted under Section 9.05
hereof, Investments permitted under Section 9.08(g) hereof (in the case of Debt
Issuances), Investments permitted under Section 9.08(h) hereof (in the case
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of Equity Issuances), Restricted Payments permitted under Section 9.09(b) hereof
(in the case of Equity Issuances) or Capital Expenditures permitted under
Section 9.12 hereof or to make prepayments of Loans under Section 2.10(c)(y)(B)
hereof, in the case of the Issuance-Related Reserved Commitment Amount, or (iii)
to make Capital Expenditures permitted under Section 9.12 hereof, to replace the
Property of the Borrowers that was the subject of the related Disposition or to
pay liabilities underlying the related Deductible Reserves, in the case of the
Disposition-Related Reserved Commitment Amount. The Borrowers agree, upon the
occasion of any borrowing of Revolving Credit Loans hereunder that is to
constitute a utilization of any Casualty-Related Reserved Commitment Amount,
Issuance-Related Reserved Commitment Amount or Disposition-Related Reserved
Commitment Amount, to advise the Administrative Agent in writing of such fact at
the time of such borrowing, identifying the amount of such borrowing that is to
constitute such utilization, the repair or replacement, acquisition, Capital
Expenditure or liability underlying a Deductible Reserve, as the case may be, in
respect of which the proceeds of such borrowing are to be applied and the
reduced Casualty-Related Reserved Commitment Amount, Issuance-Related Reserved
Commitment Amount or Disposition-Related Reserved Commitment Amount to be in
effect after giving effect to such borrowing.
(b) Term Loans. Each Term Loan Lender severally agrees, on the terms
and conditions of this Agreement, (i) to make a single term loan to the
Borrowers in Dollars on the Restatement Effective Date (provided that the same
shall occur no later than the Term Loan Commitment Termination Date) in a
principal amount up to but not exceeding the amount of the Term Loan Commitment
of such Lender and (ii) in the event that such Term Loan Lender receives as a
prepayment of its initial Term Loan hereunder Net Available Proceeds from a
Xxxxxx Disposition, to make additional loans (each, an "Acquisition Loan") to
the Borrowers during the period from and including the date of such prepayment
to but not including the Supplemental Acquisition Loan Commitment Termination
Date (the "Acquisition Loan Availability Period") in an aggregate principal
amount at any time outstanding up to but not exceeding the aggregate principal
amount of its initial Term Loan so prepaid (provided that (x) no such additional
loans shall be made after the Supplemental Acquisition Loan Commitment
Termination Date and (y) the aggregate principal amount of all such additional
loans made by all of the Term Loan Lenders to all of the Borrowers shall not
exceed $20,000,000) at any one time outstanding. Subject to the terms and
conditions of this Agreement, during the Acquisition Loan Availability Period,
the Borrowers may borrow, repay and reborrow the Acquisition
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Loans from each of the Term Loan Lenders by means of ABR Loans and Eurodollar
Loans and may Convert Acquisition Loans of one Type into Acquisition Loans of
the other Type (as provided in Section 2.09 hereof) or Continue Acquisition
Loans that are Eurodollar Loans from one Interest Period into another Interest
Period (as provided in Section 2.09 hereof). The loans made or to be made
pursuant to this paragraph (b), including, without limitation, the Acquisition
Loans, are herein called "Term Loans". Thereafter the Borrowers may Convert Term
Loans of one Type into Term Loans of the other Type (as provided in Section 2.09
hereof) or Continue Term Loans that are Eurodollar Loans from one Interest
Period into another Interest Period (as provided in Section 2.09 hereof).
(c) Payment of Existing Loans. On the Restatement Effective Date the
Borrowers shall borrow, and use the proceeds of, Revolving Credit Loans and Term
Loans in a sufficient amount to prepay in full the principal of and interest on
the Revolving Credit Loans and the Term Loans outstanding at the opening of
business on such date and any amounts payable under Section 5.05 hereof in
connection with such prepayment.
(d) Limit on Eurodollar Loans. Notwithstanding anything contained
herein to the contrary, no more than twelve separate Interest Periods in respect
of Eurodollar Loans of both Classes may be outstanding at any one time.
2.02 Borrowings. The Borrowers shall give the Administrative Agent
notice of each borrowing hereunder as provided in Section 4.05 hereof. Not later
12:00 noon New York time on the date specified for each borrowing hereunder,
each Lender shall make available the amount of the Loan or Loans to be made by
it on such date to the Administrative Agent, at an account designated by the
Administrative Agent to the Lenders, in immediately available funds, for account
of the Borrowers. The amount so received by the Administrative Agent shall,
subject to the terms and conditions of this Agreement, be made available to the
Borrowers by depositing the same, in immediately available funds, in an account
of the Borrowers designated by the Borrowers and maintained with Chase at its
principal office (it being understood and agreed that the Borrowers may maintain
other accounts at banks other than Chase).
2.03 Letters of Credit. Subject to the terms and conditions of this
Agreement, the Revolving Credit Commitments may be utilized, upon the request of
the Borrowers, in addition to the Revolving Credit Loans provided for by Section
2.01(a) hereof, by the issuance by the Issuing Bank of letters of credit
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(collectively, "Letters of Credit") for account of any Borrower or any
Restricted Subsidiary of any Borrower (as specified by the Borrowers), provided
that in no event shall (i) the aggregate amount of all Letter of Credit
Liabilities plus the aggregate principal amount of the Revolving Credit Loans
exceed the lesser of the Borrowing Base or the aggregate amount of the Revolving
Credit Commitments of all of the Revolving Credit Lenders as in effect from time
to time, (ii) the outstanding aggregate amount of all Letter of Credit
Liabilities exceed $10,000,000 or (iii) the expiration date of any Letter of
Credit extend beyond the earlier of (a) five Business Days prior to the
Revolving Credit Commitment Termination Date and (b) the date falling twelve
months after the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, one year after such renewal or execution, which
shall in no event extend beyond the date referred to clause (a) above). The
following additional provisions shall apply to Letters of Credit:
(a) The Borrowers shall give the Administrative Agent at least three
Business Days' irrevocable prior notice (effective upon receipt)
specifying the Business Day (which shall be no later than 30 days
preceding the Revolving Credit Commitment Termination Date) each Letter of
Credit is to be issued and the account party or parties therefor and
describing in reasonable detail the proposed terms of such Letter of
Credit (including the beneficiary thereof) and the nature of the
transactions or obligations proposed to be supported thereby (including
whether such Letter of Credit is to be a commercial letter of credit or a
standby letter of credit). Upon receipt of any such notice, the
Administrative Agent shall advise the Issuing Bank of the contents
thereof.
(b) On each day during the period commencing with the issuance by
the Issuing Bank of any Letter of Credit (or in the case of an Existing
Letter of Credit, on the Restatement Effective Date) and until such Letter
of Credit shall have expired or been terminated, the Revolving Credit
Commitment of each Revolving Credit Lender shall be deemed to be utilized
for all purposes of this Agreement in an amount equal to such Lender's
Revolving Credit Commitment Percentage of the then undrawn face amount of
such Letter of Credit. Each Revolving Credit Lender (other than the
Issuing Bank) agrees that, upon the issuance of any Letter of Credit
hereunder (or in the case of an Existing Letter of Credit, on the
Restatement Effective Date), it shall automatically acquire a
participation in the Issuing Bank's liability under such Letter of Credit
in an amount equal to
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such Lender's Revolving Credit Commitment Percentage of such liability,
and each Revolving Credit Lender (other than the Issuing Bank) thereby
shall absolutely, unconditionally and irrevocably assume, as primary
obligor and not as surety, and shall be unconditionally obligated to the
Issuing Bank to pay and discharge when due, its Revolving Credit
Commitment Percentage of the Issuing Bank's liability under such Letter of
Credit.
(c) Upon receipt from the beneficiary of any Letter of Credit of any
demand for payment under such Letter of Credit, the Issuing Bank shall
promptly notify the Borrowers (through the Administrative Agent) of the
amount to be paid by the Issuing Bank as a result of such demand and the
date on which payment is to be made by the Issuing Bank to such
beneficiary in respect of such demand. Notwithstanding the identity of the
account party of any Letter of Credit, the Borrowers hereby
unconditionally agree to pay and reimburse the Administrative Agent for
account of the Issuing Bank for the amount of each demand for payment
under such Letter of Credit that is in substantial compliance with the
provisions of such Letter of Credit on the Business Day on which payment
is to be made by the Issuing Bank to the beneficiary thereunder if the
Borrower shall have received notice of such payment prior to 11:00 a.m.
New York time on such Business Day or, if the Borrower shall have received
notice of such payment after such time, on the Business Day following the
date of receipt of such notice, in any case, without presentment, demand,
protest or other formalities of any kind.
(d) Forthwith upon its receipt of a notice referred to in paragraph
(c) of this Section 2.03, the Borrowers shall advise the Administrative
Agent whether or not the Borrowers intend to borrow hereunder to finance
its obligation to reimburse the Issuing Bank for the amount of the related
demand for payment and, if they do, submit a notice of such borrowing as
provided in Section 4.05 hereof.
(e) Each Revolving Credit Lender (other than the Issuing Bank) shall
pay to the Administrative Agent for account of the Issuing Bank at its
principal office in Dollars and in immediately available funds, the amount
of such Lender's Revolving Credit Commitment Percentage of any payment
under a Letter of Credit upon notice by the Issuing Bank (through the
Administrative Agent) to such Revolving Credit Lender requesting such
payment and specifying such amount. Each such Revolving Credit Lender's
obligation to
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make such payment to the Administrative Agent for account of the Issuing
Bank under this paragraph (e), and the Issuing Bank's right to receive the
same, shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever, including, without limitation, the failure of any
other Revolving Credit Lender to make its payment under this paragraph
(e), the financial condition of the Obligors (or any other account party),
the existence of any Default or the termination of the Commitments. Each
such payment to the Issuing Bank shall be made without any offset,
abatement, withholding or reduction whatsoever. If any Revolving Credit
Lender shall default in its obligation to make any such payment to the
Administrative Agent for account of the Issuing Bank, for so long as such
default shall continue the Administrative Agent may at the request of the
Issuing Bank withhold from any payments received by the Administrative
Agent under this Agreement or any Note for account of such Revolving
Credit Lender the amount so in default and, to the extent so withheld, pay
the same to the Issuing Bank in satisfaction of such defaulted obligation.
(f) Upon the making of each payment by a Revolving Credit Lender to
the Issuing Bank pursuant to paragraph (e) above in respect of any Letter
of Credit, such Lender shall, automatically and without any further action
on the part of the Administrative Agent, the Issuing Bank or such Lender,
acquire (i) a participation in an amount equal to such payment in the
Reimbursement Obligation owing to the Issuing Bank by the Borrowers
hereunder and under the Letter of Credit Documents relating to such Letter
of Credit and (ii) a participation in a percentage equal to such Lender's
Revolving Credit Commitment Percentage in any interest or other amounts
payable by the Borrowers hereunder and under such Letter of Credit
Documents in respect of such Reimbursement Obligation (other than the
commissions, charges, costs and expenses payable to the Issuing Bank
pursuant to paragraph (g) of this Section 2.03). Upon receipt by the
Issuing Bank from or for account of the Borrowers of any payment in
respect of any Reimbursement Obligation or any such interest or other
amount (including by way of setoff or application of proceeds of any
collateral security) the Issuing Bank shall promptly pay to the
Administrative Agent for account of each Revolving Credit Lender entitled
thereto, such Revolving Credit Lender's Revolving Credit Commitment
Percentage of such payment, each such payment by the Issuing Bank to be
made in the same money and funds in which received by the Issuing Bank. In
the event any payment received by the Issuing Bank
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and so paid to the Revolving Credit Lenders hereunder is rescinded or must
otherwise be returned by the Issuing Bank, each Revolving Credit Lender
shall, upon the request of the Issuing Bank (through the Administrative
Agent), repay to the Issuing Bank (through the Administrative Agent) the
amount of such payment paid to such Lender, with interest at the rate
specified in paragraph (j) of this Section 2.03.
(g) The Borrowers shall pay to the Administrative Agent for account
of each Revolving Credit Lender (ratably in accordance with their
respective Commitment Percentages) a letter of credit fee on the amount of
each Letter of Credit outstanding on each day at a rate per annum equal to
the Applicable Rate for such day for the period from and including the
date of issuance of such Letter of Credit (or in the case of an Existing
Letter of Credit, the Restatement Effective Date) (i) in the case of a
Letter of Credit that expires in accordance with its terms, to and
including such expiration date and (ii) in the case of a Letter of Credit
that is drawn in full or is otherwise terminated other than on the stated
expiration date of such Letter of Credit, to but excluding the date such
Letter of Credit is drawn in full or is terminated (such fee to be
non-refundable, to be paid in arrears on each Quarterly Date and on the
Revolving Credit Commitment Termination Date and to be calculated for any
day after giving effect to any payments made under such Letter of Credit
on such day). In addition, the Borrowers shall pay to the Administrative
Agent for account of the Issuing Bank a fronting fee in respect of each
Letter of Credit in an amount equal to 0.25% per annum of the daily
average undrawn face amount of such Letter of Credit for the period from
and including the date of issuance of such Letter of Credit (or in the
case of an Existing Letter of Credit, the Restatement Effective Date) (i)
in the case of a Letter of Credit that expires in accordance with its
terms, to and including such expiration date and (ii) in the case of a
Letter of Credit that is drawn in full or is otherwise terminated other
than on the stated expiration date of such Letter of Credit, to but
excluding the date such Letter of Credit is drawn in full or is terminated
(such fee to be non-refundable, to be paid in arrears on each Quarterly
Date and on the Revolving Credit Commitment Termination Date and to be
calculated for any day after giving effect to any payments made under such
Letter of Credit on such day) plus all commissions, charges, costs and
expenses in the amounts customarily charged by the Issuing Bank from time
to time in like circumstances with respect to the issuance of each
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Letter of Credit and drawings and other transactions relating thereto.
(h) Promptly following the end of each calendar month, the Issuing
Bank shall deliver (through the Administrative Agent) to each Revolving
Credit Lender and the Borrowers a notice describing the aggregate amount
of all Letters of Credit outstanding at the end of such month. Upon the
request of any Revolving Credit Lender from time to time, the Issuing Bank
shall deliver any other information reasonably requested by such Lender
with respect to each Letter of Credit then outstanding.
(i) The issuance by the Issuing Bank of each Letter of Credit shall,
in addition to the conditions precedent set forth in Section 7 hereof, be
subject to the conditions precedent that (i) such Letter of Credit shall
be in such form, contain such terms and support such transactions as shall
be satisfactory to the Issuing Bank consistent with its then current
practices and procedures with respect to letters of credit of the same
type and (ii) the Borrowers shall have executed and delivered such
applications, agreements and other instruments relating to such Letter of
Credit as the Issuing Bank shall have reasonably requested consistent with
its then current practices and procedures with respect to letters of
credit of the same type, provided that in the event of any conflict
between any such application, agreement or other instrument and the
provisions of this Agreement or any Security Document, the provisions of
this Agreement and the Security Documents shall control.
(j) To the extent that any Lender shall fail to pay any amount
required to be paid pursuant to paragraph (e) or (f) of this Section 2.03
on the due date therefor, such Lender shall pay interest to the Issuing
Bank (through the Administrative Agent) on such amount from and including
such due date to but excluding the date such payment is made at a rate per
annum equal to the Federal Funds Rate, provided that if such Lender shall
fail to make such payment to the Issuing Bank within three Business Days
of such due date, then, retroactively to the due date, such Lender shall
be obligated to pay interest on such amount at the Post-Default Rate.
(k) The issuance by the Issuing Bank of any modification or
supplement to any Letter of Credit hereunder shall be subject to the same
conditions applicable under
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this Section 2.03 to the issuance of new Letters of Credit, and no such
modification or supplement shall be issued hereunder unless either (i) the
respective Letter of Credit affected thereby would have complied with such
conditions had it originally been issued hereunder in such modified or
supplemented form or (ii) each Revolving Credit Lender shall have
consented thereto.
(l) Any Letter of Credit requested by the Borrowers hereunder may,
at the request of the Borrowers, be payable in a currency other than
Dollars, provided that such currency of payment is freely convertible in
the determination of the Issuing Bank. In the event that the Issuing Bank
issues any Letter of Credit that is not denominated in Dollars (a "Foreign
Currency LC"): (i) the obligations of the Borrowers and the Lenders
hereunder, including without limitation under paragraphs (c) and (e) of
this Section 2.03, to make payments with respect to such Letter of Credit
in Dollars shall not be affected because such Letter of Credit is a
Foreign Currency LC, (ii) the respective amounts to be paid by the
Borrowers and the Lenders under paragraphs (c) and (e) of this Section
2.03 with respect to any payment by the Issuing Bank under a Foreign
Currency LC shall, for all purposes hereof (including, without limitation,
the definition of "Reimbursement Obligations" in Section 1.01 hereof), be
calculated by reference to the Dollar Equivalent of such payment by the
Issuing Bank on the date of such payment by the Issuing Bank and (iii) the
undrawn amount of any Foreign Currency LC on any date shall, for all
purposes hereof (including, without limitation, the definition of "Letter
of Credit Liabilities" in Section 1.01 hereof, Section 2.03(g) hereof,
Section 2.05 hereof and 2.10(h) hereof), be calculated by reference to the
Dollar Equivalent of such amount on the Quarterly Date falling on or most
recently prior to such date or (if falling after such Quarterly Date) on
the date of issuance or latest date of extension of such Foreign Currency
LC.
The Borrowers hereby jointly and severally indemnify and hold harmless each
Revolving Credit Lender and the Administrative Agent from and against any and
all claims and damages, losses, liabilities, costs or expenses that such Lender
or the Administrative Agent may incur (or that may be claimed against such
Lender or the Administrative Agent by any Person whatsoever) by reason of or in
connection with the execution and delivery or transfer of or payment or refusal
to pay by the Issuing Bank under any Letter of Credit; provided that the
Borrowers shall not
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be required to indemnify any Lender or the Administrative Agent for any claims,
damages, losses, liabilities, costs or expenses to the extent, but only to the
extent, caused by (x) the willful misconduct or gross negligence of the Issuing
Bank in determining whether a request presented under any Letter of Credit
complied with the terms of such Letter of Credit or (y) in the case of the
Issuing Bank, such Lender's failure to pay under any Letter of Credit after the
presentation to it of a request strictly complying with the terms and conditions
of such Letter of Credit unless such payment would have violated any injunction,
decree or other order of any count. Nothing in this Section 2.03 is intended to
limit the other obligations of the Borrowers, any Lender or the Administrative
Agent under this Agreement.
2.04 Changes of Commitments.
(a) The aggregate amount of the Revolving Credit Commitments shall
be automatically reduced to zero on the Revolving Credit Commitment Termination
Date.
(b) The Borrowers shall have the right at any time or from time to
time (i) to terminate or reduce the aggregate unused amount of the Term Loan
Commitments, (ii) so long as no Revolving Credit Loans or Letter of Credit
Liabilities are outstanding, to terminate the Revolving Credit Commitments and
(iii) to reduce the aggregate unused amount of the Revolving Credit Commitments
provided that (x) the Borrowers shall give notice of each such termination or
reduction as provided in Section 4.05 hereof and (y) each partial reduction
shall be in an aggregate amount at least equal to $1,000,000 (or a larger
multiple of $1,000,000).
(c) Any portion of the Term Loan Commitments not used on the
Restatement Effective Date shall be automatically terminated.
(d) Subject to Section 2.12 hereof, the Commitments once terminated
or reduced may not be reinstated.
2.05 Commitment Fee. The Borrowers shall pay to the Administrative
Agent for account of each Lender a commitment fee (i) on the daily average
unused amount of such Lender's Revolving Credit Commitment for the period from
and including the date hereof to but not including the earlier of the date such
Revolving Credit Commitment is terminated and the Revolving Credit Commitment
Termination Date, at a rate per annum equal to the Applicable Rate and (ii) on
the daily average unused amount of such Lender's Term Loan Commitment for the
period from and including the date, if any, that such Lender's Term Loan
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Commitment is reinstated pursuant to Section 2.12 hereof to but not including
the earlier of the date (following the date of such reinstatement) such Term
Loan Commitment is terminated and the Supplemental Term Loan Commitment
Termination Date, at a rate per annum equal to the Applicable Rate. Accrued
commitment fee shall be payable (x) in arrears on each Quarterly Date and
(y)(1), with respect to the Revolving Credit Loan, on the earlier of the date
the Revolving Credit Commitments are terminated and the Revolving Credit
Commitment Termination Date or (2), with respect to the Term Loan described in
clause (ii) of this Section, on the earlier of date such Term Loan Commitment is
terminated and the Supplemental Term Loan Commitment Termination Date.
2.06 Lending Offices. The Loans of each Type made by each Lender
shall be made and maintained at such Lender's Applicable Lending Office for
Loans of such Type.
2.07 Several Obligations; Remedies Independent. The failure of any
Lender to make any Loan to be made by it on the date specified therefor shall
not relieve any other Lender of its obligation to make its Loan on such date,
but neither any Lender nor the Administrative Agent shall be responsible for the
failure of any other Lender to make a Loan to be made by such other Lender, and
(except as otherwise provided in Section 4.06 hereof) no Lender shall have any
obligation to the Administrative Agent or any other Lender for the failure by
such Lender to make any Loan required to be made by such Lender. The amounts
payable by the Borrowers at any time hereunder and under the Notes to each
Lender shall be a separate and independent debt and each Lender shall be
entitled to protect and enforce its rights arising out of this Agreement and the
Notes, and it shall not be necessary for any other Lender or the Administrative
Agent to consent to, or be joined as an additional party in, any proceedings for
such purposes.
2.08 Notes.
(a) The Revolving Credit Loans made by each Lender shall, if
requested by such Lender, be evidenced by a single promissory note of the
Borrowers substantially in the form of Exhibit A-1 hereto, dated the date
hereof, payable to such Lender in a principal amount equal to the amount of its
Revolving Credit Commitment as originally in effect and otherwise duly
completed.
(b) The Term Loan made by each Lender shall, if requested by such
Lender, be evidenced by a single promissory note of the Borrowers substantially
in the form of Exhibit A-2 hereto, dated the date hereof, payable to such Lender
in a
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principal amount equal to the amount of its Term Loan Commitment as originally
in effect and otherwise duly completed.
(c) The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each Loan of each Class made by each Lender to the
Borrowers, and each payment made on account of the principal thereof, shall be
recorded by such Lender on its books and, prior to any transfer of any Note
evidencing the Loans of such Class held by it, endorsed by such Lender on the
schedule attached to such Note or any continuation thereof; provided that the
failure of such Lender to make any such recordation or endorsement shall not
affect the obligations of the Borrowers to make a payment when due of any amount
owing hereunder or under such Note in respect of such Loans.
(d) No Lender shall be entitled to have its Notes substituted or
exchanged for any reason, or subdivided for promissory notes of lesser
denominations, except in connection with a permitted assignment of all or any
portion of such Lender's relevant Commitment, Loans and Notes pursuant to
Section 12.06 hereof (and, if requested by any Lender, the Borrowers agree to so
exchange any Note).
(e) Each Existing Lender shall return to SSC on the Restatement
Effective Date each promissory note evidencing Loans held by such Existing
Lender under the Existing Credit Agreement. Without limiting its obligation
under the preceding sentence, each Existing Lender agrees that each such
promissory note held by it shall, from and after the Restatement Effective Date,
be superseded by the Notes received by it hereunder on the Restatement Effective
Date.
2.09 Optional Prepayments and Conversions or Continuations of Loans.
Subject to Sections 4.04 and 5.05 hereof, the Borrowers shall have the right to
prepay Loans, or to Convert Loans of one Type into Loans of another Type or
Continue Loans of one Type as Loans of the same Type, at any time or from time
to time, provided that: (a) the Borrowers shall give the Administrative Agent
notice of each such prepayment, Conversion or Continuation as provided in
Section 4.05 hereof (and, upon the date specified in any such notice of
prepayment, the amount to be prepaid shall become due and payable hereunder);
(b) prepayments of the Term Loans (other than the Acquisition Loans) made on or
after the initial Principal Payment Date shall be applied to the installments of
the Term Loans ratably in accordance with the respective amounts thereof; (c)
prepayments of the Acquisition Loans made after the Supplemental Acquisition
Loan Commitment Termination Date shall be applied ratably in accordance with the
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respective amounts thereof; and (d) any Conversion or Continuation of Eurodollar
Loans shall be subject to the provisions of Section 2.01(d) hereof.
Notwithstanding the foregoing, and without limiting the rights and remedies of
the Lenders under Section 10 hereof, in the event that any Event of Default
shall have occurred and be continuing, the Administrative Agent may (and at the
request of the Majority Lenders shall) suspend the right of the Borrowers to
Convert any Loan into a Eurodollar Loan, or to Continue any Loan as a Eurodollar
Loan, in which event all Loans shall be Converted (on the last day(s) of the
respective Interest Periods therefor) or Continued, as the case may be, as ABR
Loans.
2.10 Mandatory Prepayments and Reductions of Commitments.
(a) Borrowing Base. Until the Revolving Credit Commitment
Termination Date, the Borrowers shall from time to time prepay the Revolving
Credit Loans (and/or provide cover for Letter of Credit Liabilities as specified
in paragraph (h) below) in such amounts as shall be necessary so that at all
times the aggregate outstanding amount of the Revolving Credit Loans together
with the outstanding Letter of Credit Liabilities shall not exceed the Borrowing
Base, such amount to be applied, first, to Revolving Credit Loans outstanding
and, second, as cover for Letter of Credit Liabilities outstanding.
(b) Casualty Events. Upon the date 90 days following the receipt by
SSC or any of its Restricted Subsidiaries of the proceeds of insurance,
condemnation award or other compensation in respect of any Casualty Event
affecting any Property of SSC or any of its Restricted Subsidiaries (or upon
such earlier date as such Borrower or Restricted Subsidiary, as the case may be,
shall have determined not to repair or replace the Property affected by such
Casualty Event), the Borrowers shall prepay the Loans (and/or provide cover for
Letter of Credit Liabilities as specified in paragraph (h) below), and the
Commitments shall be subject to automatic reduction, in an aggregate amount,
equal to 100% of the Net Available Proceeds of such Casualty Event not
theretofore applied to the repair or replacement of such Property, such
prepayment and reduction to be effected in each case in the manner and to the
extent specified in paragraph (g) of this Section 2.10. Nothing in this
paragraph (b) shall be deemed to limit any obligation of SSC or any of its
Restricted Subsidiaries pursuant to any of the Security Documents to remit to a
collateral or similar account (including, without limitation, the Collateral
Account) maintained by the Administrative Agent pursuant to any of the Security
Documents
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the proceeds of insurance, condemnation award or other compensation received in
respect of any Casualty Event.
Notwithstanding the foregoing, the Borrowers shall not be required
to make a prepayment pursuant to this paragraph (b) with respect to (and the
Commitments shall not be subject to reduction) (i) the first $1,000,000 of the
Net Available Proceeds from Casualty Events received by SSC and its Restricted
Subsidiaries after the Restatement Effective Date required to be so applied
after giving effect to the following clause (ii) and (ii) the Net Available
Proceeds from any Casualty Event in the event that the Borrowers advise the
Administrative Agent not later than the 90th day following the date the Net
Available Proceeds from such Casualty Event are received that they intend to use
such Net Available Proceeds to repair or replace the Property that was the
subject of such Casualty Event, so long as:
(x) such Net Available Proceeds are applied by the Borrowers to the
prepayment of Revolving Credit Loans hereunder (in which event the
Borrowers agree to advise the Administrative Agent in writing at the time
of such prepayment of Revolving Credit Loans that such prepayment is being
made from the proceeds of such Casualty Event, and that, as contemplated
by Section 2.01(a) hereof, a portion of the Revolving Credit Commitments
hereunder equal to the amount of such prepayment gives rise to a
Casualty-Related Reserved Commitment Amount that shall be available
hereunder only for purposes of repairing or replacing such Property)
provided that any excess of such Net Available Proceeds over the amount of
Revolving Credit Loans shall be held by the Borrowers in a segregated
deposit account pending such repair or replacement, and
(y) the Net Available Proceeds from such Casualty Event are in fact
so used (or committed to be used pursuant to executed construction
agreements) within twelve months of the receipt of such Net Available
Proceeds from such Casualty Event (it being understood that, in the event
Net Available Proceeds from more than one Casualty Event are applied to
the prepayment of Revolving Credit Loans, or held by the Borrowers in a
segregated deposit account, as provided in clause (x) above, such Net
Available Proceeds shall be released from such segregated deposit account
(or, as the case may be, Revolving Credit Loans utilizing the
Casualty-Related Reserved Commitment Amount shall be made) only to repair
or replace the Property that was the subject of such Casualty Event) and,
accordingly, (A) any such Net Available Proceeds so held in a segregated
deposit account
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for more than twelve months shall be forthwith applied to the prepayment
of Loans and reductions of Commitments as provided in paragraph (g) below
and (B) any Casualty-Related Reserved Commitment Amount that remains so
unutilized for more than twelve months shall, subject to the satisfaction
of the conditions precedent to such borrowing in Section 7.02 hereof, be
utilized through the borrowing by the Borrowers of Revolving Credit Loans
the proceeds of which shall be applied to the prepayment of Loans and
reductions of Commitments as provided in paragraph (g) below.
(c) Debt Issuance and Equity Issuance. Upon any Debt Issuance or
Equity Issuance, the Borrowers shall prepay the Loans (and/or provide cover for
Letter of Credit Liabilities as specified in paragraph (h) below), and the
Commitments shall be subject to automatic reduction, in an aggregate amount
equal to 100% of the Net Available Proceeds thereof, such prepayment and
reduction to be effected in each case in the manner and to the extent specified
in paragraph (g) of this Section 2.10.
Notwithstanding the foregoing, the Borrowers shall not be required
to make a prepayment (and the Commitments shall not be subject to reduction)
pursuant to this paragraph (c) with respect to the Net Available Proceeds from
any Debt Issuance or Equity Issuance (other than a Qualifying Public Offering)
in the event that the Borrowers advise the Administrative Agent at the time the
Net Available Proceeds from such Debt Issuance or Equity Issuance are received
that they intend to use such Net Available Proceeds in connection with
acquisitions permitted under Section 9.05 hereof, Investments permitted under
Section 9.08(g) hereof (in the case of Debt Issuances), Investments permitted
under Section 9.08(h) hereof (in the case of Equity Issuances), Restricted
Payments permitted under Section 9.09(b) hereof (in the case of Equity
Issuances) or Capital Expenditures permitted under Section 9.12 hereof, so long
as:
(x) such Net Available Proceeds are applied by the Borrowers to the
prepayment of Revolving Credit Loans hereunder (in which event the
Borrowers agree to advise the Administrative Agent in writing at the time
of such prepayment of Revolving Credit Loans that such prepayment is being
made from the proceeds of such Debt Issuance or Equity Issuance and that,
as contemplated by Section 2.01(a) hereof, a portion of the Revolving
Credit Commitments hereunder equal to the amount of such prepayment gives
rise to an Issuance-Related Reserved Commitment Amount that shall be
available hereunder only for purposes of making acquisitions permitted
under Section 9.05 hereof,
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Investments permitted under Section 9.08(g) hereof (in the case of Debt
Issuances), Investments permitted under Section 9.08(h) hereof (in the
case of Equity Issuances), Restricted Payments permitted under Section
9.09(b) hereof (in the case of Equity Issuances) or Capital Expenditures
permitted under Section 9.12 hereof), provided that any excess of such Net
Available Proceeds over the amount of Revolving Credit Loans shall be held
by the Borrowers in a segregated deposit account pending such
acquisitions, Investments, Restricted Payments or Capital Expenditures,
and
(y) the Net Available Proceeds from such Debt Issuance or Equity
Issuance are in fact so used (or committed to be used pursuant to executed
acquisition agreements or letters of intent) within twelve months of such
Debt Issuance or Equity Issuance (it being understood that, in the event
Net Available Proceeds from more than one Debt Issuance or Equity Issuance
are applied to the prepayment of Revolving Credit Loans, or held by the
Borrowers in a segregated deposit account, as provided in clause (x)
above, such Net Available Proceeds shall be deemed to be released from
such segregated deposit account (or, as the case may be, Revolving Credit
Loans utilizing the Issuance-Related Reserved Commitment Amount shall be
deemed to be made) in the same order in which such Debt Issuances and
Equity Issuances occurred) and, accordingly, (A) any such Net Available
Proceeds so held in a segregated deposit account for more than twelve
months shall be forthwith applied to the prepayment of Loans and
reductions of Commitments as provided in paragraph (g) below and (B) any
Issuance-Related Reserved Commitment Amount that remains so unutilized for
more than twelve months shall, subject to the satisfaction of the
conditions precedent to such borrowing in Section 7.02 hereof, be utilized
through the borrowing by the Borrowers of Revolving Credit Loans the
proceeds of which shall be applied to the prepayment of Loans and
reductions of Commitments as provided in paragraph (g) below.
(d) Excess Cash Flow. Not later than the date 150 days after the end
of each fiscal year of SSC ending after the date hereof, the Borrowers shall
prepay the Loans in an aggregate amount equal to the excess of (A) 50% of Excess
Cash Flow for such fiscal year over (B) the aggregate amount of prepayments of
Term Loans (other than prepayments of Acquisition Loans before the Supplemental
Acquisition Loan Commitment Termination Date) made during such fiscal year
pursuant to Section 2.09 hereof,
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such prepayment to be effected in each case in the manner and to the extent
specified in paragraph (g) of this Section 2.10.
(e) Sale of Assets. Without limiting the obligation of any Obligor
pursuant to Section 9.05 hereof to any Disposition not otherwise permitted
hereunder, in the event that the Net Available Proceeds of any Disposition
(herein, the "Current Disposition"), and of all prior Dispositions as to which a
prepayment has not yet been made under this Section 2.10(e), shall exceed
$2,000,000 (excluding for all purposes of this Section 2.10(e), any Disposition
the Net Available Proceeds of which is less than $250,000) then, no later than
five Business Days prior to the occurrence of the Current Disposition, the
Borrowers will deliver to the Lenders a statement, certified by a Senior
Officer, in form and detail satisfactory to the Administrative Agent, of the
amount of the Net Available Proceeds of the Current Disposition and of all such
prior Dispositions and will prepay the Loans in an aggregate amount equal to
100% of the Net Available Proceeds of the Current Disposition and such prior
Dispositions, such prepayment to be effected in each case in the manner and to
the extent specified in paragraph (g) of this Section 2.10.
Notwithstanding the foregoing, the Borrowers shall not be required
to make a prepayment pursuant to this paragraph (e) with respect to the Net
Available Proceeds from any Disposition to the extent that the Borrowers advise
the Administrative Agent at the time they deliver the statement referred to
above in this paragraph (e) that (i) they intend to use such Net Available
Proceeds in connection with Capital Expenditures permitted under Section 9.12
hereof or (ii) in the case of any Disposition, the amount of such Net Available
Proceeds constitute Deductible Reserves with respect to such Disposition, so
long as:
(x) such Net Available Proceeds are applied by the Borrowers to the
prepayment of Revolving Credit Loans hereunder (in which event the
Borrowers agree to advise the Administrative Agent in writing at the time
of such prepayment of Revolving Credit Loans that such prepayment is being
made from the proceeds of such Disposition, and that, as contemplated by
Section 2.01(a) hereof, a portion of the Revolving Credit Commitments
hereunder equal to the amount of such prepayment gives rise to a
Disposition-Related Reserved Commitment Amount that shall be available
hereunder only for purposes of making Capital Expenditures permitted by
Section 9.12 hereof or for paying the liabilities underlying such
Deductible Reserves) provided that any excess of such Net Available
Proceeds over the amount of
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Revolving Credit Loans shall be held by the Borrowers in a segregated
deposit account pending such Capital Expenditures or payments, and
(y) the Net Available Proceeds from such Disposition are in fact so
used (or, in the case of Capital Expenditures, committed to be used
pursuant to binding agreements) within 270 days (in the case of Capital
Expenditures) or twelve months (in the case of Deductible Reserves) of the
receipt of such Net Available Proceeds from such Disposition (it being
understood that, in the event Net Available Proceeds from more than one
Disposition are applied to the prepayment of Revolving Credit Loans, or
held by the Borrowers in a segregated deposit account, as provided in
clause (x) above, such Net Available Proceeds shall be released from such
segregated deposit account (or, as the case may be, Revolving Credit Loans
utilizing the Disposition-Related Reserved Commitment Amount shall be
made) only to make such Capital Expenditures or to pay such underlying
liabilities) and, accordingly, (A) any such Net Available Proceeds so held
in a segregated deposit account for more than 270 days (in the case of
Capital Expenditures) or twelve months (in the case of Deductible
Reserves) shall be forthwith applied to the prepayment of Loans as
provided in paragraph (g) below and (B) any Disposition-Related Reserved
Commitment Amount that remains so unutilized for more than 270 days (in
the case of Capital Expenditures) or twelve months (in the case of
Deductible Reserves) shall, subject to the satisfaction of the conditions
precedent to such borrowing in Section 7.02 hereof, be utilized through
the borrowing by the Borrowers of Revolving Credit Loans the proceeds of
which shall be applied to the prepayment of Loans as provided in paragraph
(g) below.
(f) Pension Fund Reversions. In the event that SSC or any of its
Restricted Subsidiaries receives any reversion from any pension fund and the
amount of such reversion (herein, the "Current Reversion"), and of all prior
reversions from pension funds as to which a prepayment has not yet been made
under this Section 2.10(f), shall exceed $500,000 then, no later than the date
falling 30 days after the Current Reversion, the Borrowers will prepay the Loans
(and/or provide cover for Letter of Credit Liabilities as specified in paragraph
(h) below), and the Commitments shall be subject to automatic reduction, in an
aggregate amount equal to 100% of the amounts received from the Current
Reversion and such prior reversions, such prepayment and reduction to be
effected in each case in the manner and to the extent specified in clause (g) of
this Section 2.10.
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(g) Application. Prepayments and reductions of Commitments described
in the above paragraphs of this Section 2.10 (other than in paragraph (a) above)
shall be effected as follows:
(i) first, the amount of the prepayment specified in such paragraphs
(other than the Net Available Proceeds from a Xxxxxx Disposition received
not later than the date falling 24 months after the Restatement Effective
Date to the extent the amount thereof exceeds $20,000,000 (the "Excess
Xxxxxx Proceeds") shall be applied to the Term Loans (other than
Acquisition Loans) then outstanding (which shall be applied on and after
the initial Principal Payment Date to the installments thereof pro rata in
accordance with the amounts of such installments) and (after payment in
full of such Term Loans) to the Acquisition Loans then outstanding (which
shall be applied after the Supplemental Acquisition Loan Commitment
Termination Date to the installments thereof pro rata in accordance with
the amounts of such installments); and
(ii) second, (x) (except in the case of paragraphs (d) and (e)
above) the Revolving Credit Commitments shall be automatically reduced in
an amount equal to any excess over the amount referred to in the foregoing
clause (i) (and to the extent that, after giving effect to such reduction,
the aggregate principal amount of Revolving Credit Loans plus the
aggregate amount of all Letter of Credit Liabilities would exceed the
Revolving Credit Commitments, the Borrowers shall, first, prepay Revolving
Credit Loans and, second, provide cover for Letter of Credit Liabilities
as specified in paragraph (h) below, in an aggregate amount equal to such
excess), (y) in the case of paragraphs (d) and (e) above, the amount equal
to any excess over the amount referred to in the foregoing clause (i)
shall be applied to the prepayment of the Revolving Credit Loans, and (z)
the Excess Xxxxxx Proceeds (as defined in said clause (i)) shall be
applied to the prepayment of the Revolving Credit Loans.
(h) Cover for Letter of Credit Liabilities. In the event that the
Borrowers shall be required pursuant to this Section 2.10, or pursuant to
Section 10 hereof, to provide cover for Letter of Credit Liabilities, the
Borrowers shall effect the same by paying to the Administrative Agent
immediately available funds in an amount equal to the required amount, which
funds shall be retained by the Administrative Agent in the Collateral Account
(as provided therein as collateral security in the first instance for the Letter
of Credit Liabilities) until such time as
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the Letters of Credit shall have been terminated and all of the Letter of Credit
Liabilities paid in full.
2.11 Joint and Several Obligations. The Borrowers shall be jointly
and severally liable for the payment and performance of all obligations and
covenants required by this Agreement to be performed by any of them, and each
Borrower shall be bound by any notices (including without limitation notices of
borrowings and Conversions), consents or other actions furnished or taken by the
other Borrowers hereunder. At the request of the Administrative Agent or any
Lender, each Borrower shall confirm in writing any action taken or proposed to
be taken by the other Borrowers hereunder; provided that the failure by any
Borrower to furnish such confirmation shall not affect such Borrower's
obligations under the preceding sentence or any other provision of this
Agreement. In the event that the Administrative Agent receives inconsistent
notices from the Borrowers, it shall be entitled to act in compliance with, or
to take no action pursuant to, any such notice.
2.12 Acquisition Loans. If the Borrowers make a prepayment of the
Term Loans pursuant to Section 2.10(e) hereof with the Net Available Proceeds of
a Xxxxxx Disposition on or before the date falling 24 months after the
Restatement Effective Date, the Term Loan Commitment of each Term Loan Lender
shall be reinstated for the purpose of Section 2.01(b) hereof by an amount equal
to the lesser of the principal amount of the Term Loan of such Term Loan Lender
so prepaid or such Term Loan Lender's pro rata share (determined by reference to
the respective principal amounts of the Term Loans of all of the Term Loan
Lenders before giving effect to such prepayment) of $20,000,000.
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loans.
(a) The Borrowers hereby promise to pay to the Administrative Agent
for account of each Lender the entire outstanding principal amount of such
Lender's Revolving Credit Loans, and each Revolving Credit Loan shall mature, on
the Revolving Credit Commitment Termination Date.
(b) The Borrowers hereby promise to pay to the Administrative Agent
for account of each Lender the principal of such Lender's Term Loans in 25
installments payable on the Principal Payment Dates. Each of such installments
that falls due on or prior to the Supplemental Acquisition Loan Commitment
Termination Date shall, subject to any prepayments applied as
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provided in Sections 2.09 and 2.10 hereof, be in a scheduled amount equal to
one-twenty-fifth of the principal amount of such Lender's Term Loans outstanding
at the close of business on the day preceding the first Principal Payment Date.
Each of such installments that falls due after the Supplemental Acquisition Loan
Commitment Termination Date shall, subject to any prepayments applied as
provided in Sections 2.09 and 2.10 hereof, be in an amount equal to the sum of
(i) an amount equal to one-twenty-fifth of the principal amount of such Lender's
Term Loans outstanding at the close of business on the day preceding the first
Principal Payment Date plus (ii) an amount equal to the aggregate principal
amount of such Lender's Acquisition Loans outstanding at the close of business
on the Supplemental Acquisition Loan Commitment Termination Date divided by the
number of Principal Payment Dates that fall on or after the Supplemental Term
Loan Commitment Termination Date.
3.02 Interest. The Borrowers hereby promise to pay to the
Administrative Agent for account of each Lender interest on the unpaid principal
amount of each Loan made by such Lender for the period from and including the
date of such Loan to but excluding the date such Loan shall be paid in full, at
the following rates per annum:
(a) during such periods as such Loan is a ABR Loan, the ABR Rate (as
in effect from time to time) plus the Applicable Rate and
(b) during such periods as such Loan is a Eurodollar Loan, for each
Interest Period relating thereto, the Eurodollar Rate for such Loan for
such Interest Period plus the Applicable Rate.
Notwithstanding the foregoing, the Borrowers hereby promise to pay to the
Administrative Agent for account of each Lender interest at the applicable
Post-Default Rate on any principal of any Loan made by such Lender, on any
Reimbursement Obligation held by such Lender and on any other amount payable by
the Borrowers hereunder or under the Notes held by such Lender to or for account
of such Lender, that shall not be paid in full when due (whether at stated
maturity, by acceleration, by mandatory prepayment or otherwise), for the period
from and including the due date thereof to but excluding the date the same is
paid in full. Accrued interest on each Loan shall be payable (i) in the case of
an ABR Loan, quarterly on the Quarterly Dates, (ii) in the case of a Eurodollar
Loan, on the last day of each Interest Period therefor and, if such Interest
Period is longer than three months, at three-month intervals following the first
day of such
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Interest Period, and (iii) in the case of any Loan, upon the payment or
prepayment thereof or the Conversion of such Loan to a Loan of another Type (but
only on the principal amount so paid, prepaid or Converted), except that
interest payable at the Post-Default Rate shall be payable from time to time on
demand. Promptly after the determination of any interest rate provided for
herein or any change therein, the Administrative Agent shall give notice thereof
to the Lenders to which such interest is payable and to the Borrowers.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
4.01 Payments.
(a) Except to the extent otherwise provided herein, all payments of
principal, interest, Reimbursement Obligations and other amounts to be made by
the Borrowers under this Agreement and the Notes, and, except to the extent
otherwise provided therein, all payments to be made by the Obligors under any
other Loan Document, shall be made in Dollars, in immediately available funds,
without deduction, set-off or counterclaim, to the Administrative Agent at an
account designated by the Administrative Agent to the Borrowers, not later than
1:00 p.m. New York time on the date on which such payment shall become due (each
such payment made after such time on such due date to be deemed to have been
made on the next succeeding Business Day).
(b) Any Lender for whose account any such payment is to be made may
(but shall not be obligated to) debit the amount of any such payment that is not
made by such time to any ordinary deposit account of the Borrowers with such
Lender (with notice to the Borrowers and the Administrative Agent), provided
that such Lender's failure to give such notice shall not affect the validity
thereof.
(c) The Borrowers shall, at the time of making each payment under
this Agreement or any Note for account of any Lender, specify to the
Administrative Agent (which shall so notify the intended recipient(s) thereof)
the Loans, Reimbursement Obligations or other amounts payable by the Borrowers
hereunder to which such payment is to be applied (and in the event that the
Borrowers fail to so specify, or if an Event of Default has occurred and is
continuing, the Administrative Agent may distribute such payment to the Lenders
for application in such manner as it or the Majority Lenders, subject to Section
4.02 hereof, may determine to be appropriate).
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(d) Except to the extent otherwise provided in the last sentence of
Section 2.03(e) hereof, each payment received by the Administrative Agent under
this Agreement or any Note for account of any Lender shall be paid by the
Administrative Agent promptly to such Lender, in immediately available funds,
for account of such Lender's Applicable Lending Office for the Loan or other
obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement or any Note
would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day, and interest shall be payable for
any principal so extended for the period of such extension.
4.02 Pro Rata Treatment. Except to the extent otherwise provided
herein: (a) each borrowing of Loans of a particular Class from the Lenders under
Section 2.01 hereof shall be made from the relevant Lenders, each payment of
commitment fee under Section 2.05 hereof in respect of Commitments of a
particular Class shall be made for account of the relevant Lenders, and each
termination or reduction of the amount of the Commitments of a particular Class
under Section 2.04 hereof shall be applied to the respective Commitments of such
Class of the relevant Lenders, pro rata according to the amounts of their
respective Commitments of such Class; (b) except as otherwise provided in
Section 5.04 hereof, Eurodollar Loans of any Class having the same Interest
Period shall be allocated pro rata among the relevant Lenders according to the
amounts of their respective Revolving Credit and Term Loan Commitments (in the
case of the making of Loans) or their respective Revolving Credit and Term Loans
(in the case of Conversions and Continuations of Loans); (c) each payment or
prepayment of principal of Revolving Credit Loans or Term Loans by the Borrowers
shall be made for account of the relevant Lenders pro rata in accordance with
the respective unpaid principal amounts of the Loans of such Class held by them;
and (d) each payment of interest on Revolving Credit Loans and Term Loans by the
Borrowers shall be made for account of the relevant Lenders pro rata in
accordance with the amounts of interest on such Loans then due and payable to
the respective Lenders.
4.03 Computations. Interest and fees payable hereunder shall be
computed on the basis of a year of 360 days (or 365/366 days, in the case the
ABR Rate when it is calculated by reference to the Prime Rate) and actual days
elapsed (including the first day but, except as otherwise provided in Section
2.03(g) hereof, excluding the last day) occurring in the period for which
payable.
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4.04 Minimum Amounts. Except for mandatory prepayments made pursuant
to Section 2.10 hereof and Conversions or prepayments made pursuant to Section
5.04 hereof, each borrowing, Conversion and partial prepayment of principal of
Loans shall be in an aggregate amount at least equal to $250,000 or a larger
multiple of $250,000 (borrowings, Conversions or prepayments of or into Loans of
different Types or, in the case of Eurodollar Loans, having different Interest
Periods at the same time hereunder to be deemed separate borrowings, Conversions
and prepayments for purposes of the foregoing, one for each Type or Interest
Period), provided that the aggregate principal amount of Eurodollar Loans having
the same Interest Period shall be in an amount at least equal to $1,000,000 or a
larger multiple of $1,000,000 and, if any Eurodollar Loans would otherwise be in
a lesser principal amount for any period, such Loans shall be ABR Loans during
such period.
4.05 Certain Notices. Notices by the Borrowers to the Administrative
Agent of terminations or reductions of the Commitments, of borrowings,
Conversions, Continuations and optional prepayments of Loans and of Classes of
Loans, of Types of Loans and of the duration of Interest Periods shall be
irrevocable and shall be effective only if received by the Administrative Agent
not later than 11:00 a.m. New York time on the number of Business Days prior to
the date of the relevant termination, reduction, borrowing, Conversion,
Continuation or prepayment or the first day of such Interest Period specified
below:
Number of
Business
Notice Days Prior
------ ----------
Termination or reduction
of Commitments 3
Borrowing or prepayment of,
or Conversions into,
ABR Loans Same day
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans 3
Each such notice of termination or reduction shall specify the amount and the
Class of the Commitments to be terminated or reduced. Each such notice of
borrowing, Conversion, Continuation
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or optional prepayment shall specify the Class of Loans to be borrowed,
Converted, Continued or prepaid and the amount (subject to Section 4.04 hereof)
and Type of each Loan to be borrowed, Converted, Continued or prepaid and the
date of borrowing, Conversion, Continuation or optional prepayment (which shall
be a Business Day). Each such notice of the duration of an Interest Period shall
specify the Loans to which such Interest Period is to relate. The Administrative
Agent shall promptly notify the Lenders of the contents of each such notice. In
the event that the Borrowers fail to select the Type of Loan, or the duration of
any Interest Period for any Eurodollar Loan, within the time period and
otherwise as provided in this Section 4.05, such Loan (if outstanding as a
Eurodollar Loan) will be automatically Converted into an ABR Loan on the last
day of the then current Interest Period for such Loan or (if outstanding as an
ABR Loan) will remain as, or (if not then outstanding) will be made as, an ABR
Loan.
4.06 Non-Receipt of Funds by the Administrative Agent. Unless the
Administrative Agent shall have been notified by a Lender or the Borrowers (the
"Payor") prior to the date on which the Payor is to make payment to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan to be
made by such Lender hereunder or (in the case of the Borrowers) a payment to the
Administrative Agent for account of one or more of the Lenders hereunder (such
payment being herein called the "Required Payment"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient(s) on such date; and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient(s) of such payment
shall, on demand, repay to the Administrative Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date (the "Advance Date") such amount was so made available by
the Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to the Federal Funds Rate for such day and, if
such recipient(s) shall fail promptly to make such payment, the Administrative
Agent shall be entitled to recover such amount, on demand, from the Payor,
together with interest as aforesaid, provided that if neither the recipient(s)
nor the Payor shall return the Required Payment to the Administrative Agent
within three Business Days of the Advance Date, then, retroactively to the
Advance Date, the Payor and the recipient(s)
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shall each be obligated to pay interest on the Required Payment as follows:
(i) if the Required Payment shall represent a payment to be made by
the Borrowers to the Lenders, the Borrowers and the recipient(s) shall
each be obligated retroactively to the Advance Date to pay interest in
respect of the Required Payment at the Post-Default Rate (without
duplication of the obligation of the Borrowers under Section 3.02 hereof
to pay interest on the Required Payment at the Post-Default Rate), it
being understood that the return by the recipient(s) of the Required
Payment to the Administrative Agent shall not limit such obligation of the
Borrowers under said Section 3.02 to pay interest at the Post-Default Rate
in respect of the Required Payment and
(ii) if the Required Payment shall represent proceeds of a Loan to
be made by the Lenders to the Borrowers, the Payor and the Borrowers shall
each be obligated retroactively to the Advance Date to pay interest in
respect of the Required Payment pursuant to whichever of the rates
specified in Section 3.02 hereof is applicable to the Type of such Loan
(which payment by the Borrowers shall pro tanto discharge their
obligations under said Section 3.02 with respect to interest on such
Loan), it being understood that the return by the Borrowers of the
Required Payment to the Administrative Agent shall not limit any claim the
Borrowers may have against the Payor in respect of such Required Payment.
4.07 Sharing of Payments, Etc.
(a) Each Obligor agrees that, in addition to (and without limitation
of) any right of set-off, banker's lien or counterclaim a Lender may otherwise
have, each Lender shall be entitled, at its option (to the fullest extent
permitted by law), to set off and apply any deposit (general or special, time or
demand, provisional or final), or other indebtedness, held by it for the credit
or account of such Obligor at any of its offices, in Dollars or in any other
currency, against any principal of or interest on any of such Lender's Loans,
Reimbursement Obligations or any other amount payable to such Lender hereunder,
that is not paid when due (regardless of whether such deposit or other
indebtedness are then due to such Obligor), in which case it shall promptly
notify such Obligor and the Administrative Agent thereof, provided that such
Lender's failure to give such notice shall not affect the validity thereof.
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(b) If any Lender shall obtain from any Obligor payment of any
principal of or interest on any Loan of any Class or Letter of Credit Liability
owing to it or payment of any other amount under this Agreement or any other
Loan Document through the exercise of any right of set-off, banker's lien or
counterclaim or similar right or otherwise (other than from the Administrative
Agent as provided herein), and, as a result of such payment, such Lender shall
have received a greater percentage of the principal of or interest on the Loans
of such Class or Letter of Credit Liabilities or such other amounts then due
hereunder or thereunder by such Obligor to such Lender than the percentage
received by any other Lender, it shall promptly purchase from such other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans of such Class or Letter of Credit Liabilities or such
other amounts, respectively, owing to such other Lenders (or in interest due
thereon, as the case may be) in such amounts, and make such other adjustments
from time to time as shall be equitable, to the end that all the Lenders shall
share the benefit of such excess payment (net of any expenses that may be
incurred by such Lender in obtaining or preserving such excess payment) pro rata
in accordance with the unpaid principal of and/or interest on the Loans of such
Class or Letter of Credit Liabilities or such other amounts, respectively, owing
to each of the Lenders. To such end all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise)
if such payment is rescinded or must otherwise be restored.
(c) The Obligors agree that any Lender so purchasing such a
participation (or direct interest) may exercise all rights of set-off, banker's
lien, counterclaim or similar rights with respect to such participation as fully
as if such Lender were a direct holder of Loans or other amounts (as the case
may be) owing to such Lender in the amount of such participation.
(d) Nothing contained herein shall require any Lender to exercise
any such right or shall affect the right of any Lender to exercise, and retain
the benefits of exercising, any such right with respect to any other
indebtedness or obligation of any Obligor. If, under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a set-off to which this Section 4.07 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders entitled under this Section 4.07 to
share in the benefits of any recovery on such secured claim.
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Section 5. Yield Protection, Etc.
5.01 Additional Costs.
(a) The Borrowers shall pay directly to each Lender from time to
time such amounts as such Lender may determine to be necessary to compensate
such Lender for any costs that such Lender determines are attributable to its
making or maintaining of any Eurodollar Loans or its obligation to make any
Eurodollar Loans hereunder, or any reduction in any amount receivable by such
Lender hereunder in respect of any of such Loans or such obligation (such
increases in costs and reductions in amounts receivable being herein called
"Additional Costs"), resulting from any Regulatory Change that:
(i) shall subject any Lender (or its Applicable Lending Office for
any of such Loans) to any tax, duty or other charge in respect of such
Loans or its Notes or changes the basis of taxation of any amounts payable
to such Lender under this Agreement or its Notes in respect of any of such
Loans (excluding changes in the rate of tax on the overall net income of
such Lender or of such Applicable Lending Office by the jurisdiction in
which such Lender has its principal office or such Applicable Lending
Office); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than the Reserve Requirement utilized in the
calculation of any amounts payable under Section 5.01(d) hereof) relating
to any extensions of credit or other assets of, or any deposits with or
other liabilities of, such Lender (including, without limitation, any of
such Loans or any deposits referred to in the definition of "Eurodollar
Rate" in Section 1.01 hereof), or any commitment of such Lender
(including, without limitation, the Commitments of such Lender hereunder);
or
(iii) imposes any other condition affecting this Agreement or its
Notes (or any of such extensions of credit or liabilities) or its
Commitments.
If any Lender requests compensation from the Borrowers under this Section
5.01(a), the Borrowers may, by notice to such Lender (with a copy to the
Administrative Agent), suspend the obligation of such Lender thereafter to make
or Continue Eurodollar Loans, or to Convert ABR Loans into Eurodollar Loans,
until the Regulatory Change giving rise to such request ceases to be in effect
(in which case the provisions of Section 5.04 hereof shall
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be applicable), provided that such suspension shall not affect the right of such
Lender to receive the compensation so requested.
(b) Without limiting the effect of the foregoing provisions of this
Section 5.01 (but without duplication), the Borrowers shall pay directly to each
Lender from time to time on request such amounts as such Lender may reasonably
determine to be necessary to compensate such Lender (or, without duplication,
the bank holding company of which such Lender is a subsidiary) for any costs
that it determines are attributable to the maintenance by such Lender (or any
Applicable Lending Office or such bank holding company), pursuant to any law or
regulation or any interpretation, directive or request (whether or not having
the force of law and whether or not failure to comply therewith would be
unlawful) of any court or governmental or monetary authority (i) following any
Regulatory Change or (ii) implementing any risk-based capital guideline or other
requirement (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) hereafter issued by any
government or governmental or supervisory authority implementing at the national
level the Basle Accord, of capital in respect of its Commitments or Loans (such
compensation to include, without limitation, an amount equal to any reduction of
the rate of return on assets or equity of such Lender (or any Applicable Lending
Office or such bank holding company) to a level below that which such Lender (or
any Applicable Lending Office or such bank holding company) could have achieved
but for such law, regulation, interpretation, directive or request).
(c) Each Lender shall notify the Borrowers of any event occurring
after the date hereof entitling such Lender to compensation under paragraph (a)
or (b) of this Section 5.01 as promptly as practicable, but in any event within
45 days, after such Lender obtains actual knowledge thereof; provided that (i)
if any Lender fails to give such notice within 45 days after it obtains actual
knowledge of such an event, such Lender shall, with respect to compensation
payable pursuant to this Section 5.01 in respect of any costs resulting from
such event, only be entitled to payment under this Section 5.01 for costs
incurred from and after the date 45 days prior to the date that such Lender does
give such notice and (ii) each Lender will designate a different Applicable
Lending Office for the Loans of such Lender affected by such event if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the sole opinion of such Lender, be disadvantageous to such
Lender, except that such Lender shall have no obligation to designate an
Applicable Lending Office located in the United
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States of America. Each Lender will furnish to the Borrowers a certificate
setting forth the basis and amount of each request by such Lender for
compensation under paragraph (a) or (b) of this Section 5.01 and under Sections
5.05, 5.06 and 5.07 hereof. Determinations and allocations by any Lender for
purposes of this Section 5.01 of the effect of any Regulatory Change pursuant to
paragraph (a) of this Section 5.01, or of the effect of capital maintained
pursuant to paragraph (b) of this Section 5.01, on its costs or rate of return
of maintaining Loans or its obligation to make Loans, or on amounts receivable
by it in respect of Loans, and of the amounts required to compensate such Lender
under this Section 5.01, shall be conclusive, provided that such determinations
and allocations are made on a reasonable basis.
(d) Without limiting the effect of (but without duplication of) the
foregoing, the Borrowers shall pay to each Lender on the last day of the
Interest Period therefor so long as such Lender is required by the Board of
Governors of the Federal Reserve System to maintain reserves against
"Eurocurrency liabilities" under Regulation D (or, unless the provisions of
paragraph (b) above are applicable, so long as such Lender is, by reason of any
Regulatory Change, required to maintain reserves against any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurodollar Loans is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Lender that includes
any Eurodollar Loans) an additional amount (determined by such Lender and
notified to the Borrowers through the Administrative Agent not later than 15
days prior to the last day of such Interest Period) equal to the product of the
following for each Eurodollar Loan for each day during such Interest Period:
(i) the principal amount of such Eurodollar Loan outstanding on such
day; and
(ii) the remainder of (x) a fraction the numerator of which is the
rate (expressed as a decimal) at which interest accrues on such Eurodollar
Loan for such Interest Period as provided in this Agreement (less the
Applicable Margin) and the denominator of which is one minus the effective
rate (expressed as a decimal) at which such reserve requirements are
imposed on such Lender on such day minus (y) such numerator; and
(iii) 1/360.
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5.02 Limitation on Types of Loans. Anything herein to the contrary
notwithstanding, if, on or prior to the determination of any Eurodollar Rate for
any Interest Period:
(a) the Administrative Agent determines, which determination shall
be conclusive, that quotations of interest rates for the relevant deposits
referred to in the definition of "Eurodollar Rate" in Section 1.01 hereof
are not being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for Eurodollar
Loans as provided herein; or
(b) if the related Loans are Revolving Credit Loans, the Majority
Revolving Credit Lenders or, if the related Loans are Term Loans, the
Majority Term Lenders determine, which determination shall be conclusive,
and notify the Administrative Agent that the relevant rates of interest
referred to in the definition of "Eurodollar Rate" in Section 1.01 hereof
upon the basis of which the rate of interest for Eurodollar Loans for such
Interest Period is to be determined are not likely adequately to cover the
cost to such Lenders of making or maintaining Eurodollar Loans for such
Interest Period;
then the Administrative Agent shall give the Borrowers and each Lender prompt
notice thereof and, so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurodollar Loans, to Continue
Eurodollar Loans or to Convert ABR Loans into Eurodollar Loans, and the
Borrowers shall, on the last day(s) of the then current Interest Period(s) for
the outstanding Eurodollar Loans, either prepay such Loans or Convert such Loans
into ABR Loans in accordance with Section 2.09 hereof.
5.03 Illegality. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to honor its obligation to make or maintain Eurodollar
Loans hereunder (and, in the sole opinion of such Lender, the designation of a
different Applicable Lending Office would either not avoid such unlawfulness or
would be disadvantageous to such Lender), then such Lender shall promptly notify
the Borrowers thereof (with a copy to the Administrative Agent) and such
Lender's obligation to make or Continue, or to Convert Loans of any other Type
into, Eurodollar Loans shall be suspended until such time as such Lender may
again make and maintain Eurodollar Loans (in which case the provisions of
Section 5.04 hereof shall be applicable).
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5.04 Treatment of Affected Loans. If the obligation of any Lender to
make Eurodollar Loans or to Continue, or to Convert ABR Loans into, Eurodollar
Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof, such Lender's
Eurodollar Loans shall be automatically Converted into ABR Loans on the last
day(s) of the then current Interest Period(s) for Eurodollar Loans (or, in the
case of a Conversion resulting from a circumstance described in Section 5.03
hereof, on such earlier date as such Lender may specify to the Borrowers with a
copy to the Administrative Agent) and, unless and until such Lender gives notice
as provided below that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Lender's Eurodollar Loans shall be applied instead to
its ABR Loans; and
(b) all Loans that would otherwise be made or Continued by such
Lender as Eurodollar Loans shall be made or Continued instead as ABR
Loans, and all ABR Loans of such Lender that would otherwise be Converted
into Eurodollar Loans shall remain as ABR Loans.
If such Lender gives notice to the Borrowers with a copy to the Administrative
Agent that the circumstances specified in Section 5.01 or 5.03 hereof that gave
rise to the Conversion of such Lender's Eurodollar Loans pursuant to this
Section 5.04 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans of the same
Class made by other Lenders are outstanding, such Lender's ABR Loans of such
Class shall be automatically Converted, on the first day(s) of the next
succeeding Interest Period(s) for such outstanding Eurodollar Loans, to the
extent necessary so that, after giving effect thereto, all ABR and Eurodollar
Loans of such Class are allocated among the Lenders ratably (as to principal
amounts, Types and Interest Periods) in accordance with their respective
Commitments of such Class.
5.05 Compensation. The Borrowers shall pay to the Administrative
Agent for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense that such Lender determines is attributable to:
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(a) any payment, mandatory or optional prepayment or Conversion of a
Eurodollar Loan made by such Lender for any reason (including, without
limitation, the acceleration of the Loans pursuant to Section 10 hereof)
on a date other than the last day of the Interest Period for such Loan; or
(b) any failure by the Borrowers for any reason (including, without
limitation, the failure of any of the conditions precedent specified in
Section 7 hereof to be satisfied) to borrow a Eurodollar Loan from such
Lender on the date for such borrowing specified in the relevant notice of
borrowing given pursuant to Section 2.02 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid,
Converted or not borrowed for the period from the date of such payment,
prepayment, Conversion or failure to borrow to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for such Loan that would have commenced on the date specified
for such borrowing) at the applicable rate of interest for such Loan provided
for herein over (ii) the amount of interest that otherwise would have accrued on
such principal amount at a rate per annum equal to the interest component of the
amount such Lender would have bid in the London interbank market for Dollar
deposits of leading banks in amounts comparable to such principal amount and
with maturities comparable to such period (as reasonably determined by such
Lender).
5.06 Additional Costs in Respect of Letters of Credit. Without
limiting the obligations of the Borrowers under Section 5.01 hereof (but without
duplication), if as a result of any Regulatory Change or any risk-based capital
guideline or other requirement heretofore or hereafter issued by any government
or governmental or supervisory authority implementing at the national level the
Basle Accord there shall be imposed, modified or deemed applicable any tax,
reserve, special deposit, capital adequacy or similar requirement against or
with respect to or measured by reference to Letters of Credit issued or to be
issued hereunder and the result shall be to increase the cost to any Lender or
Lenders of issuing (or purchasing participations in) or maintaining its
obligation hereunder to issue (or purchase participations in) any Letter of
Credit hereunder or reduce any amount receivable by any Lender hereunder in
respect of any Letter of Credit (which increases in cost, or reductions in
amount receivable, shall be the result of such Lender's or
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Lenders' reasonable allocation of the aggregate of such increases or reductions
resulting from such event), then, upon demand by such Lender or Lenders (through
the Administrative Agent), the Borrowers shall pay immediately to the
Administrative Agent for account of such Lender or Lenders, from time to time as
specified by such Lender or Lenders (through the Administrative Agent), such
additional amounts as shall be sufficient to compensate such Lender or Lenders
(through the Administrative Agent) for such increased costs or reductions in
amount. A statement as to such increased costs or reductions in amount incurred
by any such Lender or Lenders, submitted by such Lender or Lenders to the
Borrowers shall be conclusive in the absence of manifest error as to the amount
thereof.
5.07 U.S. Taxes.
(a) The Borrowers agree to pay to each Lender that is not a U.S.
Person such additional amounts as are necessary in order that the net payment of
any amount due to such non-U.S. Person hereunder after deduction for or
withholding in respect of any U.S. Taxes imposed with respect to such payment
(or in lieu thereof, payment of such U.S. Taxes by such non-U.S. Person), will
not be less than the amount stated herein to be then due and payable, provided
that the foregoing obligation to pay such additional amounts shall not apply:
(i) to any payment to any Lender hereunder unless such Lender is, on
the date hereof (or on the date it becomes a Lender hereunder as provided
in Section 12.06(b) hereof) and on the date of any change in the
Applicable Lending Office of such Lender, either entitled to submit a Form
1001 (relating to such Lender and entitling it to a complete exemption
from withholding on all interest to be received by it hereunder in respect
of the Loans) or Form 4224 (relating to all interest to be received by
such Lender hereunder in respect of the Loans), or
(ii) to any U.S. Taxes imposed solely by reason of the failure by
such non-U.S. Person (or, if such non-U.S. Person is not the beneficial
owner of the relevant Loan, such beneficial owner) to comply with
applicable certification, information, documentation or other reporting
requirements concerning the nationality, residence, identity or
connections with the United States of America of such non-U.S. Person (or
beneficial owner, as the case may be) if such compliance is required by
statute or regulation of the United States of America as a precondition to
relief or exemption from such U.S. Taxes.
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For the purposes of this Section 5.07(a), (A) "Form 1001" shall mean Form 1001
(Ownership, Exemption, or Reduced Rate Certificate) of the Department of the
Treasury of the United States of America and (B) "Form 4224" shall mean Form
4224 (Exemption from Withholding of Tax on Income Effectively Connected with the
Conduct of a Trade or Business in the United States) of the Department of the
Treasury of the United States of America (or in relation to either such Form
such successor and related forms as may from time to time be adopted by the
relevant taxing authorities of the United States of America to document a claim
to which such Form relates). Each of the Forms referred to in the foregoing
clauses (A) and (B) shall include such successor and related forms as may from
time to time be adopted by the relevant taxing authorities of the United States
of America to document a claim to which such Form relates.
(b) Within 30 days after paying any amount to the Administrative
Agent or any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the
Borrowers shall deliver to the Administrative Agent for delivery to such
non-U.S. Person evidence satisfactory to such Person of such deduction,
withholding or payment (as the case may be).
5.08 Replacement of Lenders. If any Lender requests compensation
pursuant to Section 5.01 or 5.06 hereof or in respect of U.S. Taxes pursuant to
Section 5.07 hereof, or any Lender's obligation to make or Continue, or to
Convert Loans of any Type into, any other Type of Loan shall be suspended
pursuant to Section 5.01 or 5.03 hereof (any such Lender requesting such
compensation, or whose obligations are so suspended, being herein called a
"Requesting Lender"), SSC, upon three Business Days notice, may require that
such Requesting Lender transfer all of its right, title and interest under this
Agreement and such Requesting Lender's Notes, if any, to any bank or other
financial institution (a "Proposed Lender") identified by SSC that is
satisfactory to the Administrative Agent and the Issuing Bank (i) if such
Proposed Lender agrees to assume all of the obligations of such Requesting
Lender hereunder, and to purchase all of such Requesting Lender's Loans
hereunder for consideration equal to the aggregate outstanding principal amount
of such Requesting Lender's Loans, together with interest thereon to the date of
such purchase, and satisfactory arrangements are made for payment to such
Requesting Lender of all other amounts payable hereunder to such Requesting
Lender on or prior to the date of such transfer (including any fees accrued
hereunder and any amounts that would be payable under Section 5.05 hereof as if
all of such
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Requesting Lender's Loans were being prepaid in full on such date), (ii) if such
Requesting Lender has requested compensation pursuant to Section 5.01, 5.06 or
5.07 hereof, such Proposed Lender's aggregate requested compensation, if any,
pursuant to said Section 5.01, 5.06 or 5.07 with respect to such Requesting
Lender's Loans is lower than that of the Requesting Lender and (iii) if no
Default shall have occurred and be continuing. Subject to the provisions of
Section 12.06(b) hereof, such Proposed Lender shall be a "Lender" for all
purposes hereunder. Without prejudice to the survival of any other agreement of
SSC hereunder the agreements of SSC contained in Sections 5.01, 5.06, 5.07 and
12.03 hereof (without duplication of any payments made to such Requesting Lender
by SSC or the Proposed Lender) shall survive for the benefit of such Requesting
Lender under this Section 5.08 with respect to the time prior to such
replacement.
Section 6. Guarantee.
6.01 The Guarantee. The Guarantors hereby (or, if applicable, by
execution and delivery of Joinder Agreements) jointly and severally guarantee to
each Lender and the Administrative Agent and their respective successors and
assigns the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the principal of and interest on the Loans made by
the Lenders to, and the Notes held by each Lender of, the Borrowers and all
other amounts from time to time owing to the Lenders or the Administrative Agent
by the Borrowers under this Agreement and under the Notes and by any Obligor
under any of the other Loan Documents, and all obligations of SSC or any of its
Restricted Subsidiaries to any Lender in respect of any Hedging Agreement, in
each case strictly in accordance with the terms thereof (such obligations being
herein collectively called the "Guaranteed Obligations"). The Guarantors hereby
(or, if applicable, by execution and delivery of Joinder Agreements) further
jointly and severally agree that if the Borrowers shall fail to pay in full when
due (whether at stated maturity, by acceleration or otherwise) any of the
Guaranteed Obligations, the Guarantors will promptly pay the same, without any
demand or notice whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by acceleration or
otherwise) in accordance with the terms of such extension or renewal. The
obligations of the Guarantors under this Section 6.01 constitute guarantees of
payment, not guarantees of collectibility.
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6.02 Obligations Unconditional. The obligations of the Guarantors
under Section 6.01 hereof are absolute and unconditional, joint and several,
irrespective of the value, genuineness, validity, regularity or enforceability
of the obligations of the Borrowers under this Agreement, the Notes or any other
agreement or instrument referred to herein or therein, or any substitution,
release or exchange of any other guarantee of or security for any of the
Guaranteed Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 6.02 that the obligations of the Guarantors
hereunder shall be absolute and unconditional, joint and several, under any and
all circumstances. Without limiting the generality of the foregoing, it is
agreed that the occurrence of any one or more of the following shall not alter
or impair the liability of the Guarantors hereunder which shall remain absolute
and unconditional as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under this Agreement
or the Notes or any other agreement or instrument referred to herein or
therein shall be waived or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be released or exchanged in
whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of the
Guaranteed Obligations shall fail to be perfected.
The Guarantors hereby (or, if applicable, by execution and delivery of Joinder
Agreements) expressly waive diligence, presentment, demand of payment, protest
and all notices whatsoever, and any requirement that the Administrative Agent or
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any Lender exhaust any right, power or remedy or proceed against the Borrowers
under this Agreement or the Notes or any other agreement or instrument referred
to herein or therein, or against any other Person under any other guarantee of,
or security for, any of the Guaranteed Obligations.
6.03 Reinstatement. The obligations of the Guarantors under this
Section 6 shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of the Borrowers in respect of the Guaranteed
Obligations is rescinded or must be otherwise restored by any holder of any of
the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise and the Guarantors jointly and severally agree
that they will indemnify the Administrative Agent and each Lender on demand for
all reasonable costs and expenses (including, without limitation, fees of
counsel) incurred by the Administrative Agent or such Lender in connection with
such rescission or restoration, including any such costs and expenses incurred
in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.
6.04 Subrogation. The Guarantors hereby (or, if applicable, by
execution and delivery of Joinder Agreements) waive all rights of subrogation or
contribution, whether arising by contract or operation of law (including,
without limitation, any such right arising under the Bankruptcy Code) or
otherwise by reason of any payment by it pursuant to the provisions of this
Section 6 and further agree with each Borrower for the benefit of each of its
creditors (including, without limitation, each Lender and the Administrative
Agent) that any such payment by them shall constitute a contribution of capital
by the relevant Guarantor to such Borrower (or an investment in the equity
capital of such Borrower by such Guarantor).
6.05 Remedies. The Guarantors jointly and severally agree that, as
between the Guarantors and the Lenders, the obligations of the Borrowers under
this Agreement and the Notes may be declared to be forthwith due and payable as
provided in Section 10 hereof (and shall be deemed to have become automatically
due and payable in the circumstances provided in said Section 10) for purposes
of Section 6.01 hereof notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against the Borrowers and that, in the event of such declaration
(or such obligations being deemed to have become automatically due and payable),
such
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obligations (whether or not due and payable by the Borrowers) shall forthwith
become due and payable by the Guarantors for purposes of said Section 6.01.
6.06 Instrument for the Payment of Money. Each Guarantor hereby (or,
if applicable, by execution and delivery of a Joinder Agreement) acknowledges
that the guarantee in this Section 6 constitutes an instrument for the payment
of money, and consents and agrees that any Lender or the Administrative Agent,
at its sole option, in the event of a dispute by such Guarantor in the payment
of any moneys due hereunder, shall have the right to bring motion-action under
New York CPLR Section 3213.
6.07 Continuing Guarantee. The guarantee in this Section 6 is a
continuing guarantee, and shall apply to all Guaranteed Obligations whenever
arising.
6.08 Rights of Contribution. The Guarantors hereby agree, as between
themselves, that if any Guarantor shall become an Excess Funding Guarantor (as
defined below) by reason of the payment by such Guarantor of any Guaranteed
Obligations, each other Guarantor shall, on demand of such Excess Funding
Guarantor (but subject to the next sentence), pay to such Excess Funding
Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined below
and determined, for this purpose, without reference to the Properties, debts and
liabilities of such Excess Funding Guarantor) of the Excess Payment (as defined
below) in respect of such Guaranteed Obligations. The payment obligation of a
Guarantor to any Excess Funding Guarantor under this Section 6.08 shall be
subordinate and subject in right of payment to the prior payment in full of the
obligations of such Guarantor under the other provisions of this Section 6 and
such Excess Funding Guarantor shall not exercise any right or remedy with
respect to such excess until payment and satisfaction in full of all of such
obligations.
For purposes of this Section 6.08, (i) "Excess Funding Guarantor"
shall mean, in respect of any Guaranteed Obligations, a Guarantor that has paid
an amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii)
"Excess Payment" shall mean, in respect of any Guaranteed Obligations, the
amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of
such Guaranteed Obligations and (iii) "Pro Rata Share" shall mean, for any
Guarantor, the ratio (expressed as a percentage) of (x) the amount by which the
aggregate present fair saleable value of all Properties of such Guarantor
(excluding any shares of stock of any other Guarantor) exceeds the amount of all
the debts and liabilities of such Guarantor (including contingent,
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subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of such Guarantor hereunder and any obligations of any other
Guarantor that have been Guaranteed by such Guarantor) to (y) the amount by
which the aggregate fair saleable value of all Properties of all of the
Guarantors exceeds the amount of all the debts and liabilities (including
contingent, subordinated, unmatured and unliquidated liabilities, but excluding
the obligations of the Obligors hereunder and under the other Loan Documents) of
all of the Guarantors, determined as of the date the respective Guarantor
becomes a Guarantor hereunder.
6.09 General Limitation on Guarantee Obligations. In any action or
proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under Section 6.01
hereof would otherwise, taking into account the provisions of Section 6.08
hereof, be held or determined to be void, invalid or unenforceable, or
subordinated to the claims of any other creditors, on account of the amount of
its liability under said Section 6.01, then, notwithstanding any other provision
hereof to the contrary, the amount of such liability shall, without any further
action by such Guarantor, any Lender, the Administrative Agent or any other
Person, be automatically limited and reduced to the highest amount that is valid
and enforceable and not subordinated to the claims of other creditors as
determined in such action or proceeding.
Section 7. Conditions Precedent.
7.01 Effectiveness of this Agreement. The effectiveness of the
amendment and restatement of the Existing Credit Agreement provided for hereby
is subject to the satisfaction of the following conditions precedent (provided,
that if such conditions precedent shall not have been satisfied on or before
August 22, 1997, such amendment and restatement shall not occur, regardless of
whether such conditions precedent are thereafter satisfied): (i) the execution
and delivery of an execution counterpart of this Agreement by each Person stated
to be a party to this Agreement and (ii) the receipt by the Administrative Agent
of the following documents (with, in the case of clauses (a), (b), (d), (e), (f)
and (g) below, sufficient copies for each Lender), each of which shall be
satisfactory to the Administrative Agent in form and substance (except that, in
the case of any agreement, instrument or other document to be signed, or any
other action to be taken by the Target Companies,
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the Administrative Agent shall have received evidence that such agreements,
instruments and other documents will be signed, and such other action will be
taken by the Target Companies immediately after the borrowing hereunder and the
consummation of the Acquisition to occur on the Restatement Effective Date):
(a) Corporate and Partnership Documents. Certified copies of the
Partnership Agreement and of the charter and by-laws (or equivalent
documents) of each Credit Party, and of all partnership and corporate
authority for the Credit Parties (including, without limitation, board of
director resolutions and evidence of the incumbency, including specimen
signatures, of officers for such Credit Parties) with respect to the
execution, delivery and performance of such of the Transaction Documents
to which such Credit Party is intended to be a party and each other
document to be delivered by such Credit Party from time to time in
connection herewith and the extensions of credit hereunder (and the
Administrative Agent and each Lender may conclusively rely on such
certificate until it receives notice in writing from the General Partner
or such Credit Party to the contrary).
(b) Officer's Certificate. A certificate of a Senior Officer, dated
the Restatement Effective Date, to the effect that, on and as of the
Restatement Effective Date, both immediately before and immediately after
the borrowing hereunder to occur on the Restatement Effective Date, the
consummation of the Acquisition (by operation of which the Target
Companies will become Restricted Subsidiaries of SSC) and execution and
delivery of the Joinder Agreement (by operation of which the Target
Companies will become Borrowers and Obligors hereunder) and the other
agreements, instruments and other documents, and the taking of the other
actions, by the Target Companies contemplated by this Section 7.01 to be
taken by the Target Companies immediately after the borrowing hereunder
and the consummation of the Acquisition to occur on the Restatement
Effective Date: (i) no Default shall have occurred and be continuing; and
(ii) the representations and warranties made by the Obligors in Section 8
hereof, and by each Credit Party in each of the other Loan Documents to
which it is a party, shall be true and complete.
(c) Borrowing Base Certificate. A Borrowing Base Certificate as of a
date not earlier than June 30, 1997 (provided that the information
contained therein as to the Target Companies shall be as at March 31,
1997) evidencing
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availability under the Revolving Credit Commitments, together with a
certificate of a Senior Officer, dated the Restatement Effective Date, to
the effect that the Consolidated Borrowing Base of SSC and its
Subsidiaries has not decreased by a material amount since June 30, 1997
(or, in the case of the Target Companies, March 31, 1997).
(d) Opinion of Counsel to the Obligors. An opinion, dated the
Restatement Effective Date, of Xxxxxxxx & Xxxxx, counsel to the Obligors,
in form and substance satisfactory to the Administrative Agent (and each
Obligor hereby instructs such counsel to deliver such opinion to the
Lenders and the Administrative Agent).
(e) Opinion(s) of Local Counsel. Opinion(s), dated the Restatement
Effective Date, of local counsel in the respective states in which the
properties covered by the Mortgage(s) are located, in form and substance
satisfactory to the Administrative Agent (and each Obligor hereby
instructs such counsel to deliver such opinion(s) to the Lenders and the
Administrative Agent).
(f) Opinion of Special New York Counsel to Chase. An opinion, dated
the Restatement Effective Date, of Milbank, Tweed, Xxxxxx & XxXxxx,
special New York counsel to Chase, in form and substance satisfactory to
the Administrative Agent (and Chase hereby instructs such counsel to
deliver such opinion to the Lenders).
(g) Notes. The Notes, duly completed and executed for each Lender.
(h) Personal Property Security Documents; Joinder Agreement.
(i) The Security Agreement, duly executed and delivered by the
Obligors and the Administrative Agent and the stock certificates
identified under the name of such Obligor in Annex 1 thereto (in
each case accompanied by undated stock powers executed in blank). In
addition, each Obligor shall have taken such other action
(including, without limitation, delivering to the Administrative
Agent, for filing, appropriately completed and duly executed copies
of Uniform Commercial Code financing statements) as the
Administrative Agent shall have requested in order to perfect the
security interests created pursuant to the Security Agreement;
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(ii) the Partnership Pledge Agreement, duly executed and
delivered by the Partnership and the Administrative Agent and the
stock certificates listed in Annex 1 thereto, accompanied by undated
stock powers executed in blank. In addition, the Partnership shall
have taken such other action (including, without limitation,
delivering to the Administrative Agent, for filing, appropriately
completed and duly executed copies of Uniform Commercial Code
financing statements) as the Administrative Agent shall have
requested in order to perfect the security interests created
pursuant to the Partnership Pledge Agreement; and
(iii) the Joinder Agreement, duly executed and delivered by
the Target Companies and the Administrative Agent.
(i) Mortgage and Title Insurance for Acquired Facilities. The
following documents each of which shall be executed (and, where
appropriate, acknowledged) by Persons satisfactory to the Administrative
Agent:
(i) one or more Mortgages covering the fee interests in
facilities acquired by the Obligors in the Acquisition located in
Mentor, Ohio, in LaGrange, Georgia, and Umatilla, Florida (the
"Acquired Facilities"), in each case duly executed and delivered by
the owner thereof in recordable form (in such number of copies as
the Administrative Agent shall have requested);
(ii) if, and to the extent, requested by the Administrative
Agent, one or more mortgagee policies of title insurance on forms of
and issued by one or more title companies satisfactory to the
Administrative Agent (the "Title Companies"), insuring the validity
and first priority of the Liens created by the Mortgage(s) over the
Acquired Facilities in form and in amounts satisfactory to the
Administrative Agent, subject only to such exceptions as are
satisfactory to the Administrative Agent and, to the extent
necessary under applicable law, for filing in the appropriate county
land office(s), Uniform Commercial Code financing statements
covering fixtures, in each case appropriately completed and duly
executed;
(iii) if, and to the extent, requested by the Administrative
Agent, as-built surveys of recent date
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of each of the Acquired Facilities, showing such matters as may be
required by any Lender, which surveys shall be in form and content
acceptable to the Administrative Agent, and certified to the
Administrative Agent and the Title Companies, and shall have been
prepared by a registered surveyor acceptable to the Administrative
Agent; and
(iv) if, and to the extent, requested by the Administrative
Agent, certified copies of permanent and unconditional certificates
of occupancy (or, if it is not the practice to issue certificates of
occupancy in the jurisdiction in which the Acquired Facilities are
located, then such other evidence reasonably satisfactory to the
Administrative Agent) permitting the fully functioning operation and
occupancy of each Acquired Facility.
In addition, the Borrowers shall have paid to the Title Companies all
expenses and premiums of the Title Companies in connection with the
issuance of such policies and in addition shall have paid to the Title
Companies an amount equal to the recording and stamp taxes payable in
connection with recording the Mortgage(s) over the Acquired Facilities in
the appropriate county land office(s). If the Administrative Agent does
not require delivery of any item referred to in any of the preceding
clauses (ii), (iii) or (iv) on the Restatement Effective Date, the
Borrowers shall, if requested by the Administrative Agent on the
Restatement Effective Date, deliver or cause to be delivered to the
Administrative Agent such item as promptly as practicable after the
Restatement Effective Date; provided that, in the case of the policies of
title insurance referred to in said clause (ii) with respect to the
facility in Florida, such policies shall be delivered no later than the
90th day after the Restatement Effective Date.
(j) Mortgage Amendments. The following documents each of which shall
be executed (and, where appropriate, acknowledged) by Persons satisfactory
to the Administrative Agent:
(i) Mortgage Amendments amending the Mortgages executed and
delivered pursuant to the Existing Credit Agreement (the "Existing
Mortgages"), in each case duly executed and delivered by the owner
thereof in recordable form (in such number of copies as the
Administrative Agent shall have requested);
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(ii) if, and to the extent, requested by the Administrative
Agent, one or more mortgagee policies of title insurance or
endorsements to existing title insurance policies on forms of and
issued by the applicable Title Companies, insuring the validity and
first priority of the Liens created under the Existing Mortgages as
amended by the Mortgage Amendments in form and in amounts
satisfactory to the Administrative Agent, subject only to the
exceptions in the existing title insurance policies and such other
exceptions as are satisfactory to the Administrative Agent and, to
the extent necessary under applicable law, for filing in the
appropriate county land office(s), Uniform Commercial Code financing
statements covering fixtures, in each case appropriately completed
and duly executed; and
(iii) if, and to the extent, requested by the Title Companies
to provide title insurance coverage acceptable to the Administrative
Agent, a recertification by a registered surveyor acceptable to the
Title Companies of as-built surveys of each of the facilities
covered by the Existing Mortgages, showing such matters as may be
required by any Lender, which surveys shall be in form and content
acceptable to the Administrative Agent.
In addition, the Borrowers shall have paid to the Title Companies all
expenses and premiums of the Title Companies in connection with the
issuance of such policies or endorsements to existing title policies and
in addition shall have paid to the Title Companies an amount equal to the
recording and stamp taxes payable in connection with recording the
Mortgage Amendments in the appropriate county land office(s). If the
Administrative Agent does not require delivery of any item referred to in
any of the preceding clauses (ii) or (iii) on the Restatement Effective
Date, the Borrowers shall, if requested by the Administrative Agent on the
Restatement Effective Date, deliver or cause to be delivered to the
Administrative Agent such item as promptly as practicable after the
Restatement Effective Date.
(k) Environmental Assessments. An environmental assessment prepared
by IT Corporation ("IT") in respect of each of the sites and facilities to
be acquired in the Acquisition, such environmental assessment to be in
form,
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scope and substance, and based upon investigations, satisfactory to the
Administrative Agent.
(l) Solvency Certificate. A certificate of the chief financial
officer of SSC to the effect that, as of the Restatement Effective Date
and after giving effect to the initial extension of credit hereunder, the
Acquisition, the issuance of the Senior Subordinated Notes and the Seller
Subordinated Note, and the other transactions contemplated hereby, (i) the
aggregate value of all Properties of SSC and its Restricted Subsidiaries
at their present fair saleable value (i.e., the amount that may be
realized within a reasonable time, considered to be six months to one
year, either through collection or sale at the regular market value,
conceiving the latter as the amount that could be obtained for the
Property in question within such period by a capable and diligent
businessman from an interested buyer who is willing to purchase under
ordinary selling conditions), exceed the amount of all the debts and
liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities) of SSC and its Restricted Subsidiaries, (ii) SSC
and its Restricted Subsidiaries will not, on a consolidated basis, have an
unreasonably small capital with which to conduct their business operations
as heretofore conducted and (iii) SSC and its Restricted Subsidiaries will
have, on a consolidated basis, sufficient cash flow to enable them to pay
their debts as they mature.
(m) Senior Subordinated Notes. Evidence that the Senior Subordinated
Notes Documents shall have been duly authorized, executed and delivered in
the forms thereof furnished to the Lenders prior to the date hereof, and
the Administrative Agent shall have received copies of each of the Senior
Subordinated Notes Documents certified by a Senior Officer. In addition,
the Administrative Agent shall have received evidence to the effect that
SSC shall have received, or simultaneously with the borrowing hereunder to
occur on the Restatement Effective Date will receive, cash proceeds (prior
to the payment of any transaction fees, expenses, commissions or
discounts) from the issuance of the Senior Subordinated Notes in an
aggregate amount of at least $125,000,000.
(n) Approvals. Evidence that all governmental and material third
party approvals (including landlords' and other consents) necessary or, in
the discretion of the Administrative Agent, advisable in connection with
the Acquisition, the financings contemplated hereby and the
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continuing operations of SSC and its Subsidiaries shall have been obtained
and be in full force and effect, and that all applicable waiting periods
shall have expired without any action being taken or threatened by any
competent authority which would restrain, prevent or otherwise impose
adverse conditions on the Acquisition or such financings.
(o) Equity. Evidence that (i) the Partnership shall have received,
or simultaneously with the borrowing hereunder to occur on the Restatement
Effective Date will receive, (x) from a Person or Persons acceptable to
the Administrative Agent cash consideration (prior to the payment of any
transaction fees or expenses) in an amount not less than $33,800,000 (when
aggregated with cash contributions made by the General Partner to the
Partnership) in exchange for the issuance of limited partnership interests
in the Partnership and (y) from management employees of the Partnership,
in exchange for the issuance of limited partnership interests in the
Partnership and capital stock in the General Partner, promissory notes in
the aggregate principal amount of $2,029,685 (together with the promissory
notes referred to in Section 10(o) hereof if any, as such promissory notes
referred to in this paragraph (o) and in said Section 10(o) if any shall,
subject to Section 9.19 hereof, be modified and supplemented and in effect
from time to time, the "Management Notes"), in each of the cases referred
to in the foregoing clauses (x) and (y) on terms and conditions reasonably
satisfactory to the Administrative Agent and (ii) SSC shall have received,
or simultaneously with the borrowing hereunder to occur on the Restatement
Effective Date will receive from the Partnership a contribution to its
common equity of cash in an amount not less than $33,800,000 and of the
Management Notes executed and delivered on the Restatement Effective Date.
(p) Transactions. (i) Evidence that the Acquisition shall have been,
or simultaneously with the borrowing hereunder to occur on the Restatement
Effective Date will be, consummated for an aggregate purchase price
(including the refinancing of the existing indebtedness related to the
Target Companies, the payment for the consideration of all outstanding
shares of common stock of the Target Companies and the Seller Subordinated
Note) not exceeding $136,000,000 (subject to adjustments relating to the
amount of working capital as provided in the Acquisition Agreement) and in
all other material respects in accordance with the terms of the
Acquisition Documents (all conditions precedent to the
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consummation of the Acquisition set forth in the Acquisition Agreement
requiring the satisfaction of any Person to be deemed for this purpose to
require the satisfaction of the Lenders), including the schedules and
exhibits thereto (except for any modifications, supplements or waivers
thereof, or written consents or determinations made by any parties
thereto, each of which shall be reasonably satisfactory to the
Administrative Agent), (ii) evidence that the other Transactions shall
have been, or simultaneously with the borrowing hereunder to occur on the
Restatement Effective Date will be consummated, (iii) a certificate of a
Senior Officer to that effect and to the effect that attached thereto are
true and complete copies of the Seller Subordinated Note and the other
documents delivered in connection with the closing thereunder and (iv)
letters, addressed to the Administrative Agent and the Lenders, from all
counsel that rendered legal opinions in connection with the Transactions,
permitting the Administrative Agent and the Lenders to rely upon such
legal opinions.
(q) Pro Forma Financial Statements. A pro forma consolidated balance
sheet and a consolidated statement of cash flows for SSC, its Subsidiaries
and the Target Companies as at and for the period of four fiscal quarters
ending on March 31, 1997, giving effect to the Acquisition, in form and
substance and providing such details as are reasonably satisfactory to the
Administrative Agent, and accompanied by a certificate of a Senior
Officer, which certificate shall state that, in the opinion of the Senior
Officer, the assumptions contained therein are reasonable and that such
financial statements fairly present in all material respects the
consolidated financial condition of SSC, its Subsidiaries and the Target
Companies as at such date and for such period after giving pro forma
effect to the Acquisition in accordance with generally accepted accounting
principles.
(r) Insurance. Certificates of insurance evidencing the existence of
all insurance required to be maintained by SSC pursuant to Section 9.04
hereof and the designation of the Administrative Agent as the loss payee
or additional named insured, as the case may be, thereunder to the extent
required by said Section 9.04, such certificates to be in such form and
contain such information as is specified in said Section 9.04.
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(s) Business Plan. A copy of a business plan for fiscal year 1997
and a written analysis of the business and prospects of SSC and its
Restricted Subsidiaries for the period from the Restatement Effective Date
through the Final Maturity Date in form and substance and providing such
details as are reasonably satisfactory to the Administrative Agent.
(t) No Judgment and Litigation. A certificate of a Senior Officer
certifying that (i) there exists no judgment, order, injunction or other
restraint issued or filed which prohibits the making of any Loans, the
issuance of any Letters of Credit or the consummation of the Acquisition
or the other transactions contemplated hereby and (ii) no action, suit or
litigation proceeding at law or in equity by or before any court or
Governmental Authority or agency exists or is threatened with respect to
the Acquisition.
(u) Interest, Fees and Expenses under the Existing Credit Agreement.
Evidence that the Administrative Agent and the Existing Lenders shall have
received all accrued and unpaid interest, fees and expenses, and amounts
due under Section 5.05 hereof, owing to them under the Existing Credit
Agreement.
(v) Lien Searches. Results of recent lien searches in each relevant
jurisdiction with respect to SSC and its Subsidiaries and the Target
Companies showing that there are no Liens except for Permitted Liens and
Liens listed on Part B of Schedule I to this Agreement.
(w) Audit. A report of an independent collateral auditor (which may
be, or be affiliated with, one of the Lenders) in form and substance, and
as at a date, satisfactory to the Administrative Agent with respect to the
Receivables and Inventory of SSC and its Restricted Subsidiaries and the
Target Companies.
(x) Structure, Etc. Neither the Administrative Agent nor any Lender
shall have objected to (i) the state and Federal tax assumptions of SSC,
(ii) the ownership, capital, organization and legal structure of the
Partnership and its Subsidiaries, including, without limitation, all
limited partnership units or capital stock issued by the Partnership and
its Subsidiaries and any options, warrants or other securities issued in
connection therewith and the other transactions contemplated hereby, (iii)
the quality and condition of the Properties of SSC and its Subsidiaries
and
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the Target Companies or (iv) the material contracts of the Target
Companies to be assumed or acquired as part of the Acquisition, including,
without limitation (i) documents evidencing or otherwise relating to any
material amount of Indebtedness (including Guarantees) to be assumed, (ii)
material supply and purchase contracts and (iii) indemnities in favor of
SSC or any of its Subsidiaries.
(y) Other Documents. Such other documents as the Administrative
Agent or special New York counsel to Chase may reasonably request.
The obligation of any Lender to make any extension of credit hereunder on or
after the Restatement Effective Date is also subject to the payment by the
Borrowers of such fees as any Obligor shall have agreed to pay or deliver to any
Lender or the Administrative Agent in connection herewith, including, without
limitation, the reasonable fees and expenses of Milbank, Tweed, Xxxxxx & XxXxxx,
special New York counsel to Chase, in connection with the negotiation,
preparation, execution and delivery of this Agreement and the Notes and the
other Loan Documents and the extensions of credit hereunder (to the extent that
statements for such fees and expenses have been delivered to the Borrowers).
7.02 Initial and Subsequent Extensions of Credit. The obligation of
the Lenders to make any Loan or otherwise extend any credit to the Borrowers
upon the occasion of each borrowing or other extension of credit hereunder
(including on the Restatement Effective Date) is subject to the further
conditions precedent that, both immediately prior to the making of such Loan or
other extension of credit and also after giving effect thereto and to the
intended use thereof:
(a) no Default shall have occurred and be continuing (except that
this paragraph (a) shall not apply to a default in the payment when due
during the applicable grace period of any amount referred to in Section
10(a)(ii) hereof if the amount to be borrowed is to be used simultaneously
with such borrowing to cure such default);
(b) the representations and warranties made by the Obligors in
Section 8 hereof, and by each Credit Party in each of the other Loan
Documents to which it is a party, shall be true and complete in all
material respects on and as of the date of the making of such Loan or
other extension of credit with the same force and effect as if made on and
as of such date (or, if any such representation or warranty
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is expressly stated to have been made as of a specific date, as of such
specific date); and
(c) the aggregate principal amount of the Revolving Credit Loans
together with the aggregate amount of all Letter of Credit Liabilities
shall not exceed the Borrowing Base reflected on the most recent Borrowing
Base Certificate delivered pursuant to Section 9.01(f) hereof.
Each notice of borrowing or request for the issuance of a Letter of Credit by
the Borrowers hereunder shall constitute a certification by the Borrowers to the
effect set forth in the preceding sentence (both as of the date of such notice
or request and, unless the Borrowers otherwise notify the Administrative Agent
prior to the date of such borrowing or issuance, as of the date of such
borrowing or issuance).
Section 8. Representations and Warranties. Each of the Obligors
represents and warrants to the Administrative Agent and the Lenders that:
8.01 Corporate Existence. Each of SSC and its Restricted
Subsidiaries (other than the Foreign Companies): (a) is a corporation,
partnership or other entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization; (b) has all
requisite corporate or other power, and has all material governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being or as proposed to be conducted; and (c) is qualified
to do business and is in good standing in all jurisdictions in which the nature
of the business conducted by it makes such qualification necessary and where
failure so to qualify could (either individually or in the aggregate) have a
Material Adverse Effect.
8.02 Financial Condition. SSC has heretofore furnished to each of
the Lenders consolidated balance sheets of the Partnership and its Subsidiaries
as at December 31, 1996 and the related consolidated statements of income,
retained earnings and cash flows of the Partnership and its Subsidiaries for the
fiscal year ended on said date, with the opinion thereon of Ernst & Young, and
the unaudited consolidated balance sheets of the Partnership and its
Subsidiaries as at March 31, 1997 and the related consolidated statements of
income, retained earnings and cash flows of the Partnership and its Subsidiaries
for the three-month period ended on such date. All such financial statements are
complete and correct and fairly present the consolidated financial condition of
the Partnership and its
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Subsidiaries as at said dates and the consolidated and unconsolidated results of
their operations for the fiscal year and three-month period ended on said dates
(subject, in the case of such financial statements as at March 31, 1997, to
normal year-end audit adjustments), all in accordance with generally accepted
accounting principles and practices applied on a consistent basis. None of the
Partnership nor any of its Subsidiaries has on the date hereof any material
contingent liabilities, liabilities for taxes, unusual forward or long-term
commitments or unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said balance
sheets as at said dates. Since December 31, 1996, there has been no material
adverse change in the consolidated financial condition, operations, business or
prospects taken as a whole of SSC and its Restricted Subsidiaries from that set
forth in said financial statements as at said date.
8.03 Litigation. There are no legal or arbitral proceedings, or any
proceedings by or before any governmental or regulatory authority or agency, now
pending or (to the knowledge of any Obligor) threatened against SSC or any of
its Restricted Subsidiaries that, if adversely determined could (either
individually or in the aggregate) have a Material Adverse Effect.
8.04 No Breach. None of the execution and delivery of this Agreement
and the Notes and the other Transaction Documents, the consummation of the
transactions herein and therein contemplated or compliance with the terms and
provisions hereof and thereof will conflict with or result in a breach of, or
require any consent under, the Partnership Agreement or the charter or by-laws
of the General Partner or any Guarantor, or any applicable law or regulation, or
any order, writ, injunction or decree of any court or governmental authority or
agency, or any agreement or instrument (other than an immaterial agreement or
instrument) to which the General Partner or SSC or any of its Restricted
Subsidiaries is a party or by which any of them or any of their Property is
bound or to which any of them is subject, or constitute a default under any such
agreement or instrument (other than an immaterial agreement or instrument), or
(except for the Liens created pursuant to the Security Documents) result in the
creation or imposition of any Lien upon any Property of the General Partner, SSC
or any of its Restricted Subsidiaries pursuant to the terms of any such
agreement or instrument (other than an immaterial agreement). An "immaterial
agreement or instrument" shall mean an agreement or instrument the relevant
breach of or default under which would not have a Material Adverse Effect or a
material adverse effect upon the ranking of any of the obligations of any Credit
Party under any thereof.
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8.05 Action. Each Obligor has all necessary partnership or corporate
(as the case may be) power, authority and legal right to execute, deliver and
perform its obligations under each of the Transaction Documents to which it is a
party; the execution, delivery and performance by each Obligor of each of the
Transaction Documents to which it is a party have been duly authorized by all
necessary partnership or corporate (as the case may be) action on its part
(including, without limitation, any required shareholder approvals); and this
Agreement has been duly and validly executed and delivered by each Obligor and
constitutes, and each of the Notes and the other Transaction Documents to which
it is a party when executed and delivered by such Obligor (in the case of the
Notes, for value) will constitute, its legal, valid and binding obligation,
enforceable against each Obligor in accordance with its terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement of
creditors' rights and (b) the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
8.06 Approvals. No authorizations, approvals or consents of, and no
filings or registrations with, any governmental or regulatory authority or
agency, or any securities exchange, are necessary for the execution, delivery or
performance by any Obligor of this Agreement or any of the other Transaction
Documents to which it is a party or for the legality, validity or enforceability
hereof or thereof, except for (a) filings and recordings in respect of the Liens
created pursuant to the Security Documents, (b) those that have been obtained or
made and are in full force and effect on the date hereof and (c) routine filings
and consents not required on the date hereof and obtainable in the ordinary
course of business and when and as required.
8.07 ERISA. Each Plan, and, to the knowledge of the Obligors, each
Multiemployer Plan, is in compliance in all material respects with, and has been
administered in all material respects in compliance with, the applicable
provisions of ERISA, the Code and any other Federal or State law, and no event
or condition has occurred and is continuing as to which SSC would be under an
obligation to furnish a report to the Lenders under Section 9.01(e) hereof.
8.08 Taxes. SSC and its Subsidiaries (and the General Partner and
the Partnership) have filed all Federal income tax returns and all other
material tax returns and information
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statements that are required to be filed by them and have paid all material
taxes due pursuant to such returns or pursuant to any assessment received by SSC
or any of its Subsidiaries. The charges, accruals and reserves on the books of
SSC and its Subsidiaries in respect of taxes and other governmental charges are,
in the opinion of SSC, adequate. As of the Restatement Effective Date, neither
SSC nor any of its Subsidiaries has given or been requested to give a waiver of
the statute of limitations relating to the payment of any Federal, state, local
and foreign taxes or other impositions.
8.09 Investment Company Act. Neither SSC nor any of its Restricted
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.
8.10 Public Utility Holding Company Act. Neither SSC nor any of its
Restricted Subsidiaries is a "holding company", or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
8.11 Material Agreements and Liens.
(a) Part A of Schedule I hereto is a complete and correct list of
each credit agreement, loan agreement, indenture, purchase agreement, guarantee,
letter of credit or other arrangement providing for or otherwise relating to any
Indebtedness or any extension of credit (or commitment for any extension of
credit) to, or guarantee by, SSC or any of its Subsidiaries or any of the Target
Companies outstanding on the date hereof the aggregate principal or face amount
of which equals or exceeds (or may equal or exceed) $10,000, and the aggregate
principal or face amount outstanding or that may become outstanding under each
such arrangement is correctly described in Part A of said Schedule I.
(b) Part B of Schedule I hereto is a complete and correct list of
each Lien securing Indebtedness of any Person outstanding on the date hereof the
aggregate principal or face amount of which equals or exceeds (or may equal or
exceed) $10,000 and covering any Property of SSC or any of its Subsidiaries or
any of the Target Companies, and the aggregate Indebtedness secured (or that may
be secured) by each such Lien and the Property covered by each such Lien is
correctly described in Part B of said Schedule I.
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8.12 Environmental Matters. Except as disclosed on Schedule V hereto
and except as would not reasonably be expected for each of the following matters
to lead to liability in excess of $200,000, to the knowledge of the Obligors:
(a) Each of SSC and its Subsidiaries has obtained all environmental,
health and safety permits, licenses and other authorizations required under all
Environmental Laws to carry on its business as now being or as proposed to be
conducted, except to the extent failure to have any such permit, license or
authorization would not (either individually or in the aggregate) have a
Material Adverse Effect.
(b) Each of such permits, licenses and authorizations is in full
force and effect and each of SSC and its Subsidiaries is in compliance with the
terms and conditions thereof, and is also in compliance with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in any applicable Environmental
Law or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder,
except to the extent failure to comply therewith would not (either individually
or in the aggregate) have a Material Adverse Effect.
(c) No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been filed, no
penalty has been assessed and no investigation or review is pending or
threatened by any governmental or other entity with respect to any alleged
failure by SSC or any of its Subsidiaries to have any environmental, health or
safety permit, license or other authorization required under any Environmental
Law in connection with the conduct of the business of SSC or any of its
Subsidiaries or with respect to any generation, treatment, storage, recycling,
transportation, discharge or disposal, or any Release of any Hazardous Materials
generated by SSC or any of its Subsidiaries.
(d) Neither SSC nor any of its Subsidiaries owns, operates or leases
a treatment, storage or disposal facility requiring a permit under the Resource
Conservation and Recovery Act of 1976, as amended, or under any comparable state
or local statute;
(e) Except to the extent duly authorized by law:
(i) no polychlorinated biphenyls (PCB's) are or have been
present at any site or facility now or
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previously owned, operated or leased by SSC or any of its
Subsidiaries; and
(ii) there are no underground storage tanks or surface
impoundments for Hazardous Materials, active or abandoned, at any
site or facility now or previously owned, operated or leased by SSC
or any of its Subsidiaries.
(f) No Hazardous Materials have been Released at, on or under any
site or facility now or previously owned, operated or leased by SSC or any of
its Subsidiaries in a reportable quantity established by and required to be
reported under any statute, ordinance, rule, regulation or order.
(g) No Hazardous Materials have been otherwise Released at, on or
under any site or facility now or previously owned, operated or leased by SSC or
any of its Subsidiaries that would (either individually or in the aggregate)
have a Material Adverse Effect.
(h) No asbestos containing materials is or has been present at any
site or facility now or previously owned, operated or leased by SSC or any of
its Subsidiaries that would result in more than $500,000 in response removal
costs at a single facility, or in the aggregate would have a Material Adverse
Effect.
(i) To the Obligors' knowledge, neither SSC nor any of its
Subsidiaries has transported or arranged for the transportation of any Hazardous
Material to any location that is listed on the National Priorities List ("NPL")
under the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended ("CERCLA"), listed for possible inclusion on the NPL by the
Environmental Protection Agency in the Comprehensive Environmental Response and
Liability Information System, as provided for by 40 C.F.R. ss. 300.5
("CERCLIS"), or on any similar state or local list or that is the subject of
Federal, state or local enforcement actions or other investigations that may
lead to Environmental Claims against SSC or any of its Subsidiaries.
(j) Except to the extent duly authorized by law and in a manner that
would not lead to liability, no Hazardous Material generated by SSC or any of
its Subsidiaries has been recycled, treated, stored, disposed of or Released by
SSC or any of its Subsidiaries at any location.
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(k) No oral or written notification of a Release of a Hazardous
Material has been filed by or on behalf of SSC or any of its Subsidiaries, and
no site or facility now or previously owned, operated or leased by SSC or any of
its Subsidiaries is listed or proposed for listing on the NPL, CERCLIS or any
similar state list of sites requiring investigation or clean-up.
(l) No Liens have arisen under or pursuant to any Environmental Laws
on any site or facility owned, operated or leased by SSC or any of its
Subsidiaries, and no government action has been taken or is in process that
could subject any such site or facility to such Liens, and neither SSC nor any
of its Subsidiaries would be required to place any notice or restriction
relating to the presence of Hazardous Materials at any site or facility owned by
it in any deed to the real property on which such site or facility is located.
(m) All environmental investigations, studies, audits, tests,
reviews or other analyses (excluding any privileged analyses by legal counsel on
behalf of the any Obligor) conducted by or that are in the possession of SSC or
any of its Subsidiaries in relation to facts, circumstances or conditions at or
affecting any site or facility now or previously owned, operated or leased by
SSC or any of its Subsidiaries and that could result in a Material Adverse
Effect have been made available to the Lenders.
8.13 Capitalization. The authorized capital stock of SSC consists,
on the date hereof, of an aggregate of 1,000 shares consisting of 100 shares of
Class A common stock, $.01 per share and 900 shares of Class B common stock,
$0.1 per share, all of which shares are duly and validly issued and outstanding,
each of which shares is fully paid and nonassessable. As of the date hereof all
of such issued and outstanding shares of common stock are owned beneficially and
of record by the Partnership. As of the date hereof, (x) there are no
outstanding Equity Rights with respect to SSC and (y) there are no outstanding
obligations of SSC or any of its Subsidiaries to repurchase, redeem, or
otherwise acquire any shares of capital stock of SSC nor are there any
outstanding obligations of SSC or any of its Subsidiaries to make payments to
any Person, such as "phantom stock" payments, where the amount thereof is
calculated with reference to the fair market value or equity value of SSC or any
of its Subsidiaries.
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8.14 Subsidiaries, Etc.
(a) Set forth in Part B of Schedule II hereto is a complete and
correct list of all of the Subsidiaries of SSC and the Target Companies as of
the date hereof together with, for each such Person, (i) the jurisdiction of
organization of such Person, (ii) each Person holding ownership interests in
such Person and (iii) the nature of the ownership interests held by each such
Person and the percentage of ownership of such Person represented by such
ownership interests. Except as disclosed in Part B of Schedule II hereto, (x)
each of SSC and its Subsidiaries owns, free and clear of Liens (other than Liens
created pursuant to the Security Documents), and has the unencumbered right to
vote, all outstanding ownership interests in each Person shown to be held by it
in Part B of Schedule II hereto, (y) all of the issued and outstanding capital
stock of each such Person organized as a corporation is validly issued, fully
paid and nonassessable and (z) there are no outstanding Equity Rights with
respect to such Person.
(b) Set forth in Part C of Schedule II hereto is a complete and
correct list of all Investments (other than Investments disclosed in Part B of
said Schedule II hereto and Investments permitted by paragraphs (b), (c), (d)
and (e) of Section 9.08 hereof) held by SSC or its Subsidiaries or the Target
Companies in any Person on the date hereof having a fair market value of
$200,000 or greater (provided, that, the aggregate fair market value of all
Investments (other than Investments so disclosed or permitted) not listed on
said Schedule II does not exceed $500,000), and, for each such Investment, (x)
the identity of the Person or Persons holding such Investment and (y) the nature
of such Investment. Except as disclosed in Part C of Schedule II hereto, each of
SSC and its Subsidiaries owns, free and clear of all Liens (other than Liens
created pursuant to the Security Documents), all such Investments.
(c) None of the Target Companies or the Subsidiaries of SSC is, on
the date hereof, subject to any indenture, agreement, instrument or other
arrangement of the type described in Section 9.18(c) hereof.
8.15 True and Complete Disclosure. The information, reports,
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Obligors to the Administrative Agent or any Lender in connection
with the negotiation, preparation or delivery of this Agreement and the other
Loan Documents or included herein or therein or delivered pursuant
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hereto or thereto, when taken as a whole do not contain any untrue statement of
material fact or omit to state any material fact necessary to make the
statements herein or therein, in light of the circumstances under which they
were made, not misleading. All written information furnished after the date
hereof by SSC and its Subsidiaries to the Administrative Agent and the Lenders
in connection with this Agreement and the other Loan Documents and the
transactions contemplated hereby and thereby will be true, complete and accurate
in every material respect, or (in the case of projections) based on reasonable
estimates, on the date as of which such information is stated or certified.
There is no fact known to the Obligors that could have a Material Adverse Effect
that has not been disclosed herein, in the other Loan Documents or in a report,
financial statement, exhibit, schedule, disclosure letter or other writing
furnished to the Lenders for use in connection with the transactions
contemplated hereby or thereby.
8.16 Real Property. Set forth on Schedule III attached hereto is a
list, as of the date hereof, of all of the real property interests held by SSC,
any of its Subsidiaries or any of the Target Companies, indicating in each case
whether the respective Property is owned or leased, the identity of the owner or
lessee and the location of the respective Property.
8.17 Certain Documents. SSC has furnished to the Lenders a true and
complete copy of the Acquisition Agreement, the Equity Documents, the
Registration Rights Agreement and the Senior Subordinated Notes Indenture as in
effect on the date hereof.
8.18 Solvency. As of the date of each extension of credit hereunder
(and after giving effect thereto and to the use thereof by the Borrowers), (i)
the aggregate value of all Properties of SSC and its Restricted Subsidiaries at
their present fair saleable value (i.e., the amount that may be realized within
a reasonable time, considered to be six months to one year, either through
collection or sale at the regular market value, conceiving the latter as the
amount that could be obtained for the Property in question within such period by
a capable and diligent businessman from an interested buyer who is willing to
purchase under ordinary selling conditions), exceed the amount of all the debts
and liabilities (including contingent, subordinated, unmatured and unliquidated
liabilities) of SSC and its Restricted Subsidiaries, (ii) SSC and its Restricted
Subsidiaries do not, on a consolidated basis, have an unreasonably small capital
with which to conduct their business operations as heretofore conducts and (iii)
SSC and its
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Restricted Subsidiaries have, on a consolidated basis, sufficient cash flow to
enable them to pay their debts as they mature.
Section 9. Covenants of the Obligors. Each of the Obligors covenants
and agrees with the Lenders and the Administrative Agent that, so long as any
Commitment, Loan or Letter of Credit Liability is outstanding and until payment
in full of all outstanding amounts payable by the Borrowers hereunder:
9.01 Financial Statements Etc. SSC shall deliver to each of the
Lenders:
(a) as soon as available and in any event within 45 days after the
end of each quarterly fiscal period of each fiscal year of SSC,
consolidated statements of income, retained earnings and cash flows of SSC
and its Restricted Subsidiaries for such period and for the period from
the beginning of the respective fiscal year to the end of such period, and
the related consolidated balance sheet of SSC and its Restricted
Subsidiaries as at the end of such period, setting forth in each case in
comparative form the corresponding consolidated figures for the
corresponding periods in the preceding fiscal year, if available (except
that, in the case of balance sheets, such comparison shall be to the last
day of the prior fiscal year), accompanied by a certificate of a Senior
Officer, which certificate shall state that said consolidated financial
statements fairly present in all material respects the consolidated
financial condition and results of operations of SSC and its Restricted
Subsidiaries (except as provided in Section 1.02(d) hereof) in accordance
with generally accepted accounting principles, consistently applied, as at
the end of, and for, such period (subject to normal year-end audit
adjustments);
(b) as soon as available and in any event within 120 days after the
end of each fiscal year of SSC, consolidated and consolidating statements
of income, retained earnings and cash flows of SSC and its Restricted
Subsidiaries for such fiscal year and the related consolidated and
consolidating balance sheets of SSC and its Restricted Subsidiaries as at
the end of such fiscal year, setting forth in each case in comparative
form the corresponding consolidated and consolidating figures for the
preceding fiscal year, and accompanied (i) in the case of said
consolidated statements and balance sheet of SSC, by an opinion thereon of
independent certified public accountants
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of recognized national standing, which opinion shall state that said
consolidated financial statements fairly present in all material respects
the consolidated financial condition and results of operations of SSC and
its Restricted Subsidiaries as at the end of, and for, such fiscal year in
accordance with generally accepted accounting principles, and a statement
of such accountants to the effect that, in making the examination
necessary for their opinion, nothing came to their attention that caused
them to believe that SSC was not in compliance with Sections 9.06(h),
9.07(e), 9.10, 9.11 and 9.12 hereof, insofar as such Sections relate to
accounting matters, and (ii) in the case of said consolidating statements
and balance sheets, by a certificate of a Senior Officer, which
certificate shall state that said consolidating financial statements
fairly present the respective individual unconsolidated financial
condition and results of operations of SSC and its Restricted
Subsidiaries, in each case in accordance with generally accepted
accounting principles, consistently applied, as at the end of, and for,
such fiscal year;
(c) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any, that SSC or
any of its Restricted Subsidiaries shall have filed with the Securities
and Exchange Commission (or any governmental agency substituted therefor)
or any national securities exchange;
(d) promptly upon the mailing thereof to the partners of SSC
generally or to holders of any class of Subordinated Indebtedness
generally, copies of all financial statements, reports and proxy
statements so mailed and promptly upon receipt from the holders of any
class of Subordinated Indebtedness, copies of all notices and statements
delivered to any of the Obligors;
(e) as soon as possible, and in any event within ten days after SSC
knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan has
occurred or exists, a statement signed by a Senior Officer setting forth
details respecting such event or condition and the action, if any, that
SSC or its ERISA Affiliate proposes to take with respect thereto (and a
copy of any report or notice required to be filed with or given to the
PBGC by any of the Obligors or an ERISA Affiliate with respect to such
event or condition):
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(i) any reportable event, as defined in Section 4043(b) of
ERISA and the regulations issued thereunder, with respect to a Plan,
as to which the PBGC has not by regulation waived the requirement of
Section 4043(a) of ERISA that it be notified within 30 days of the
occurrence of such event (provided that a failure to meet the
minimum funding standard of Section 412 of the Code or Section 302
of ERISA, including, without limitation, the failure to make on or
before its due date a required installment under Section 412(m) of
the Code or Section 302(e) of ERISA, shall be a reportable event
regardless of the issuance of any waivers in accordance with Section
412(d) of the Code); and any request for a waiver under Section
412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of ERISA of a notice
of intent to terminate any Plan or any action taken by SSC or an
ERISA Affiliate to terminate any Plan;
(iii) the institution by the PBGC of proceedings under Section
4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or the receipt by SSC or any ERISA
Affiliate of a notice from a Multiemployer Plan that such action has
been taken by the PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a Multiemployer
Plan by SSC or any ERISA Affiliate that results in liability under
Section 4201 or 4204 of ERISA (including the obligation to satisfy
secondary liability as a result of a purchaser default) or the
receipt by SSC or any ERISA Affiliate of notice from a Multiemployer
Plan that it is in reorganization or insolvency pursuant to Section
4241 or 4245 of ERISA or that it intends to terminate or has
terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against SSC or any ERISA Affiliate to enforce
Section 515 of ERISA, which proceeding is not dismissed within 30
days; and
(vi) the adoption of an amendment to any Plan that, pursuant
to Section 401(a)(29) of the Code or Section 307 of ERISA, would
result in the loss of
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tax-exempt status of the trust of which such Plan is a part if SSC
or an ERISA Affiliate fails to timely provide security to the Plan
in accordance with the provisions of said Sections;
(f) as soon as available and in any event within 15 days (or, in the
case of each monthly accounting period ending before the first anniversary
of the Restatement Effective Date, 30 days) after the end of each monthly
accounting period (ending on the last day of each calendar month), a
Borrowing Base Certificate as at the last day of such accounting period;
(g) periodically at the request of the Administrative Agent or the
Majority Lenders (but not more frequently than once per calendar year
unless a Default shall have occurred and be continuing), a report of an
independent collateral auditor (which may be, or be affiliated with, one
of the Lenders) with respect to the Receivables and Inventory components
included in the Borrowing Base as at the end of any monthly accounting
period which report shall indicate that, based upon a review by such
auditors of the Receivables (including, without limitation, verification
with respect to the amount, aging, identity and credit of the respective
account debtors and the billing practices of SSC and its Restricted
Subsidiaries) and Inventory (including, without limitation, verification
as to the value, location and respective types), the information set forth
in the Borrowing Base Certificate delivered by SSC as at the end of such
accounting period is accurate and complete in all material respects and in
addition, as soon as available and in any event within 120 days after the
end of each fiscal year of SSC, a like report of Ernst & Young LLP or
other independent public accountants with respect to the Receivables and
Inventory components included in the Borrowing Base as at the end of such
fiscal year;
(h) promptly after SSC knows or has reason to believe that any
Default has occurred, a notice of such Default describing the same in
reasonable detail and, together with such notice or as soon thereafter as
possible, a description of the action that SSC has taken or proposes to
take with respect thereto;
(i) from time to time such other information regarding the financial
condition, operations, business or prospects of SSC or any of its
Subsidiaries (including, without limitation, any Plan or Multiemployer
Plan and any reports
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or other information required to be filed under ERISA) as any Lender or
the Administrative Agent may reasonably request.
SSC will furnish to each Lender, at the time it furnishes each set of financial
statements pursuant to paragraph (a), (b) or (c) above, a certificate of a
Senior Officer (i) to the effect that no Default has occurred and is continuing
(or, if any Default has occurred and is continuing, describing the same in
reasonable detail and describing the action that SSC has taken or proposes to
take with respect thereto) and (ii) setting forth in reasonable detail the
computations necessary to determine whether SSC is in compliance with Sections
9.06(h), 9.07(e), 9.10, 9.11 and 9.12 hereof as of the end of the respective
month, quarterly fiscal period or fiscal year.
9.02 Litigation. SSC will promptly give to each Lender notice of all
legal or arbitral proceedings, and of all proceedings by or before any
governmental or regulatory authority or agency, and any material development in
respect of such legal or other proceedings, affecting SSC or any of its
Subsidiaries, except proceedings that, if adversely determined, would not
reasonably be expected (either individually or in the aggregate) to have a
Material Adverse Effect. Without limiting the generality of the foregoing, SSC
will give to each Lender notice of the assertion of any Environmental Claim by
any Person against, or with respect to the activities of, SSC or any of its
Subsidiaries and notice of any alleged violation of or non-compliance with any
Environmental Laws or any permits, licenses or authorizations, other than any
Environmental Claim or alleged violation that, if adversely determined, would
not reasonably be expected (either individually or in the aggregate) to have a
Material Adverse Effect.
9.03 Existence, Etc. SSC will, and will cause each of its Restricted
Subsidiaries to:
(a) preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises (provided that
nothing in this Section 9.03 shall prohibit any transaction expressly
permitted under Section 9.05 hereof);
(b) comply with the requirements of all applicable laws, including
but not limited to Environmental Laws, rules, regulations and orders of
governmental or regulatory authorities if failure to comply with such
requirements
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could reasonably be expected (either individually or in the aggregate) to
have a Material Adverse Effect;
(c) pay and discharge all material taxes, assessments and
governmental charges or levies imposed on it or on its income or profits
or on any of its Property prior to the date on which penalties attach
thereto, except for any such tax, assessment, charge or levy the payment
of which is being contested in good faith and by proper proceedings and
against which adequate reserves are being maintained;
(d) maintain all of its material Properties used or useful in its
business in good working order and condition, ordinary wear and tear
excepted;
(e) keep adequate records and books of account, in which complete
entries will be made in accordance with GAAP consistently applied; and
(f) permit representatives of any Lender or the Administrative
Agent, during normal business hours, to examine, copy and make extracts
from its books and records, to inspect any of its Properties, and to
discuss its business and affairs with its officers, all to the extent
reasonably requested by such Lender or the Administrative Agent (as the
case may be).
9.04 Insurance. SSC will, and will cause each of its Restricted
Subsidiaries to, maintain insurance with financially sound and reputable
insurance companies, and with respect to Property and risks of a character
usually maintained by corporations engaged in the same or similar business
similarly situated, against loss, damage and liability of the kinds and in the
amounts customarily maintained by such corporations, provided that SSC will in
any event maintain (with respect to itself and each of its Restricted
Subsidiaries) casualty insurance and insurance against claims for damages with
respect to defamation, libel, slander, privacy or other similar injury to person
or reputation (including misappropriation of personal likeness), in such amounts
as are then customary for Persons engaged in the same or similar business
similarly situated. SSC will in any event maintain (with respect to itself and
each of its Restricted Subsidiaries):
(1) Casualty Insurance -- insurance against loss or damage covering
all of the tangible real and personal Property and improvements of SSC and
each of its Restricted Subsidiaries by reason of any Peril (as defined
below) in
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such amounts (subject to such deductibles as shall be satisfactory to the
Majority Lenders) as shall be reasonable and customary and sufficient to
avoid the insured named therein from becoming a co-insurer of any loss
under such policy but in any event in an amount (i) in the case of fixed
assets and equipment (including, without limitation, vehicles), at least
equal to 100% of the actual replacement cost of such assets (including,
without limitation, foundation, footings and excavation costs), subject to
deductibles as aforesaid and (ii) in the case of inventory, not less than
the fair market value thereof, subject to deductibles as aforesaid.
(2) Automobile Liability Insurance for Bodily Injury and Property
Damage -- insurance against liability for bodily injury and property
damage in respect of all vehicles (whether owned, hired or rented by SSC
or any of its Restricted Subsidiaries) at any time located at, or used in
connection with, its Properties or operations in such amounts as are then
customary for vehicles used in connection with similar Properties and
businesses, but in any event to the extent required by applicable law.
(3) Comprehensive General Liability Insurance --insurance against
claims for bodily injury, death or Property damage occurring on, in or
about the Properties (and adjoining streets, sidewalks and waterways) of
SSC and its Restricted Subsidiaries, in such amounts as are then customary
for Property similar in use in the jurisdictions where such Properties are
located.
(4) Workers' Compensation Insurance -- workers' compensation
insurance (including, without limitation, Employers' Liability Insurance)
to the extent required by applicable law.
(5) Product Liability Insurance -- insurance against claims for
bodily injury, death or Property damage resulting from the use of products
sold by SSC or any of its Restricted Subsidiaries in such amounts as are
then customarily maintained by responsible persons engaged in businesses
similar to that of SSC and its Restricted Subsidiaries.
(6) Business Interruption Insurance -- insurance against loss of
operating income (up to an aggregate amount equal to $500,000 and subject
to a deductible, or
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self-insured amount, not in excess of $100,000) by reason of any Peril.
(7) Other Insurance -- such other insurance, as generally carried by
owners of similar Properties in the jurisdictions where such Properties
are located, in such amounts and against such risks as are then customary
for Property similar in use.
Such insurance shall be written by financially responsible companies selected by
SSC and having an A. M. Best rating of "A" or better and being in a financial
size category of VII or larger, or by other companies acceptable to the Majority
Lenders, and (other than workers' compensation) shall name the Administrative
Agent as loss payee (to the extent covering risk of loss or damage to tangible
property) and as an additional named insured as its interests may appear (to the
extent covering any other risk). Each policy referred to in this Section 9.04
shall provide that it will not be canceled or reduced, or allowed to lapse
without renewal, except after not less than 10 days' notice to the
Administrative Agent and shall also provide that the interests of the
Administrative Agent and the Lenders shall not be invalidated by any act or
negligence of the Obligors or any Person having an interest in any Property
covered by the Mortgage nor by occupancy or use of any such Property for
purposes more hazardous than permitted by such policy nor by any foreclosure or
other proceedings relating to such Property. SSC will advise the Administrative
Agent promptly of any policy cancellation, reduction or amendment.
On or before the Restatement Effective Date, SSC will deliver to the
Administrative Agent certificates of insurance satisfactory to the
Administrative Agent evidencing the existence of all insurance required to be
maintained by SSC hereunder setting forth the respective coverages, limits of
liability, carrier, policy number and period of coverage and showing that such
insurance will remain in effect at least through December 31, 1997, subject only
to the payment of premiums as they become due (and attaching copies of or
certificates evidencing any policies with respect to casualty insurance).
Thereafter, not later than 5 days prior to the stated termination date of any
policy of insurance required to be maintained by SSC hereunder, SSC will deliver
to the Administrative Agent a certificate of insurance evidencing that such
policy has been extended for at least one year, subject only to the payment of
premiums as they become due. SSC will not obtain or carry separate insurance
concurrent in form or contributing in the event of loss with that required by
this Section 9.04 unless the Administrative Agent is
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the named insured thereunder, with loss payable as provided herein. SSC will
immediately notify the Administrative Agent whenever any such separate insurance
is obtained and shall deliver to the Administrative Agent the certificates
evidencing the same.
Without limiting the obligations of SSC under the foregoing
provisions of this Section 9.04, in the event SSC shall fail to maintain in full
force and effect insurance as required by the foregoing provisions of this
Section 9.04, then the Administrative Agent may, but shall have no obligation so
to do, procure insurance covering the interests of the Lenders and the
Administrative Agent in such amounts and against such risks as the
Administrative Agent (or the Majority Lenders) shall deem appropriate, and SSC
shall reimburse the Administrative Agent in respect of any premiums paid by the
Administrative Agent in respect thereof.
For purposes hereof, the term "Peril" shall mean, collectively,
fire, lightning, flood, windstorm, hail, explosion, riot and civil commotion,
vandalism and malicious mischief, damage from aircraft, vehicles and smoke and
all other perils covered by the "all-risk" endorsement then in use in the
jurisdictions where the Properties of SSC and its Restricted Subsidiaries are
located.
9.05 Prohibition of Fundamental Changes. SSC will not, nor will it
permit any of its Restricted Subsidiaries to, enter into any transaction of
merger or consolidation or amalgamation, or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution).
SSC will not, nor will it permit any of its Restricted Subsidiaries
to, acquire any business or Property from, or capital stock of, or be a party to
any acquisition of, any Person except for acquisitions permitted by paragraph
(e) below, purchases of inventory and other Property to be sold or used in the
ordinary course of business, Investments permitted under Section 9.08 hereof,
and Capital Expenditures permitted under Section 9.12 hereof.
SSC will not, nor will it permit any of its Restricted Subsidiaries
to, convey, sell, lease, transfer or otherwise dispose of, in one transaction or
a series of transactions, any part of its business or Property, whether now
owned or hereafter acquired (including, without limitation, receivables and
leasehold interests, but excluding (i) obsolete or worn-out Property, tools or
equipment no longer used or useful in its
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business so long as the amount thereof sold in any single fiscal year by SSC and
its Restricted Subsidiaries shall not have a fair market value in excess of
$500,000 and (ii) any inventory or other Property licensed, leased, sold or
disposed of in the ordinary course of business and on ordinary business terms).
Notwithstanding the foregoing provisions of this Section 9.05 (but subject to
the last sentence of this Section 9.05):
(a) any Restricted Subsidiary of a Borrower may be merged or
consolidated with or into: (i) a Borrower if such Borrower shall be the
continuing or surviving corporation or (ii) any other such Restricted
Subsidiary; provided that (x) if any such transaction shall be between a
Subsidiary and a Wholly Owned Subsidiary, the Wholly Owned Subsidiary
shall be the continuing or surviving corporation and (y) that if any such
transaction shall be between a Guarantor and a Subsidiary not a Guarantor,
and such Guarantor is not the continuing or surviving corporation, then
the continuing or surviving corporation shall have assumed all of the
obligations of such Guarantor hereunder and under the other Loan
Documents;
(b) any Borrower or any Restricted Subsidiary of a Borrower may
sell, lease, transfer or otherwise dispose of any or all of its Property
(upon voluntary liquidation or otherwise) to a Borrower or a Restricted
Subsidiary that is a Wholly Owned Subsidiary of a Borrower; provided that
(i) if any such sale, lease, transfer or other disposition is by a
Borrower, then the transferee shall be a Borrower and (ii) if any such
sale, lease, transfer or other disposition is by a Guarantor to a
Subsidiary of a Borrower not a Guarantor, then such Subsidiary shall have
assumed all of the obligations of such Guarantor hereunder and under the
other Loan Documents;
(c) the Borrowers or any Restricted Subsidiary of the Borrowers may
merge or consolidate with any other Person if (i) in the case of a merger
or consolidation of a Borrower, a Borrower is the surviving corporation
and, in any other case, the surviving corporation is a Restricted
Subsidiary that is a Wholly Owned Subsidiary of a Borrower and (ii) after
giving effect thereto no Default would exist hereunder;
(d) SSC and its Restricted Subsidiaries may consummate the
Transactions;
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(e) SSC and its Restricted Subsidiaries may acquire any business
consisting of manufacturing and/or selling specialty chemicals products or
otherwise engaged in the specialty chemicals business, and closely related
businesses or businesses incidental thereto (collectively, the "Specialty
Chemicals Business"), and the related assets or stock (by merger or
consolidation or otherwise), and subject to clause (iv) below and Section
9.05(h) hereof, any business unrelated to the Specialty Chemicals
Business, so long as:
(i) no Default exists either before or after giving effect
thereto;
(ii) SSC shall have demonstrated in reasonable detail after
giving effect to such acquisition and any borrowings in connection
with such acquisition that SSC is in compliance with Section 9.10
hereof and shall have furnished to the Lenders projections
demonstrating that SSC will be in compliance for the period from the
date of such acquisition through the twelve-month anniversary of
such acquisition;
(iii) SSC shall have provided the Lenders with not less than
10 Business Days' prior notice of each such acquisition, together
with copies of the documentation for such acquisition as and when
the same become available, and the Majority Lenders or the
Administrative Agent shall not have objected to such documentation;
and
(iv) any portion of such business that is not a Specialty
Chemicals Business shall comprise less than the greater of (x)
$4,000,000 or (y) 10% of the value of the business so acquired, as
determined by SSC in good faith using any reasonable methodology;
(f) SSC and its Restricted Subsidiaries may sell Properties having
an aggregate fair market value not exceeding $5,000,000 in any fiscal year
of SSC;
(g) SSC and its Restricted Subsidiaries may consummate the Xxxxxx
Disposition for fair market value, provided that not less than 80% of the
consideration received therefor consists of cash;
(h) if any acquisition by SSC or any of its Restricted Subsidiaries
permitted by Section 9.05(e) hereof includes
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any business that is not a Specialty Chemicals Business (as defined in
said Section 9.05(e)), SSC or such Restricted Subsidiary shall, within
twelve months of such acquisition, sell such business;
(i) Evode may sell its grinding operations; and
(j) SSC and its Restricted Subsidiaries may sell accounts receivable
in connection with the collection or compromise thereof in the ordinary
course of their business.
In no event shall SSC or any of its Subsidiaries make any tender offer or other
public offer for any capital stock or partnership or other equity interest
issued by any Person unless a majority of the board of directors or similar
governing body of such Person shall have adopted a resolution approving such
offer.
9.06 Limitation on Liens. SSC will not, nor will it permit any of
its Restricted Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon any of its Property, whether now owned or hereafter acquired, except:
(a) Liens created pursuant to the Security Documents;
(b) Liens in existence on the date hereof that either (x) are listed
in Part B of Schedule I hereto or (y) secure Indebtedness the aggregate
principal or face amount of which is less than $100,000, and renewals or
replacements thereof provided that the amount of the obligations secured
thereby is not increased, and such Liens are not spread to cover any
additional Property;
(c) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or either that do not exceed $100,000
in the aggregate or that are being contested in good faith and by
appropriate proceedings if (in the case of such contested taxes) adequate
reserves with respect thereto are maintained on the books of SSC or the
affected Restricted Subsidiaries, as the case may be, in accordance with
GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's,
landlord's, repairmen's or other like Liens arising in the ordinary course
of business that are not overdue for a period of more than 30 days or that
are being contested in good faith and by appropriate proceedings and Liens
securing judgments but only to the extent for an
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amount and for a period not resulting in an Event of Default under Section
10(i) hereof;
(e) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(f) deposits to secure the performance of bids, trade contracts
(other than for Indebtedness), leases, statutory obligations, insurance,
surety and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on
the use of Property or minor imperfections in title thereto that, in the
aggregate, are not material in amount, and that do not in any case
materially detract from the value of the Property subject thereto or
interfere with the ordinary conduct of the business of SSC or any of its
Restricted Subsidiaries;
(h) additional Liens upon real and/or personal Property created
after the date hereof, provided that the aggregate Indebtedness secured
thereby and incurred on and after the date hereof shall not exceed
$4,000,000 in the aggregate at any one time outstanding.
(i) Liens on Property of any Person that becomes a Restricted
Subsidiary of SSC after the date hereof, provided that such Liens are in
existence at the time such corporation becomes a Restricted Subsidiary of
SSC and were not created in anticipation thereof;
(j) Liens upon real and/or tangible personal Property acquired after
the date hereof by SSC or any of its Restricted Subsidiaries that existed
on such Property before the time of its acquisition and were not created
in anticipation thereof; provided that no such Lien shall extend to or
cover any Property of SSC or such Restricted Subsidiary other than the
Property so acquired and improvements thereon;
(k) rights of set-off held by banks by operation of law or pursuant
to customary deposit agreements against deposits held at or certificates
of deposit issued by such banks so long as such deposits or certificates
of deposit
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are made or acquired in the ordinary course of business and not in
anticipation of the incurrence of any Indebtedness;
(l) the interests of licensors, lessors, sublessors, licensees,
lessees and sublicensees in licenses and leases entered into in the
ordinary course of business and not securing Indebtedness;
(m) Liens on capital stock of, or partnership interests or other
equity interests in, Unrestricted Subsidiaries securing obligations of
Unrestricted Subsidiaries; and
(n) Liens on Property located outside of the United States of
America of any Restricted Subsidiary the jurisdiction of organization of
which and the principal place of business of which is located outside of
the United States of America to the extent that such Liens secure the
Indebtedness of such Restricted Subsidiary permitted by Section 9.07(f)
hereof.
9.07 Indebtedness. SSC will not, nor will it permit any of its
Restricted Subsidiaries to, create, incur or suffer to exist any Indebtedness
except:
(a) Indebtedness to the Lenders hereunder and under the other
Transaction Documents;
(b) Indebtedness outstanding on the date hereof that either (x) is
listed in Part A of Schedule I hereto or (y) has an aggregate principal or
face amount less than $100,000, and renewals or refinancings thereof
provided that the aggregate amount thereof is not increased;
(c) Subordinated Indebtedness;
(d) Indebtedness of Restricted Subsidiaries of SSC to SSC or to
other Restricted Subsidiaries of SSC;
(e) Indebtedness of any Person that becomes a Restricted Subsidiary
of SSC after the date hereof, provided that such Indebtedness is
outstanding at the time such Person becomes a Restricted Subsidiary of SSC
and is not created in anticipation thereof;
(f) additional Indebtedness of SSC and its Restricted Subsidiaries
(including without limitation, Capital Lease Obligations and other
Indebtedness secured by Liens
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permitted under Section 9.06(h) hereof) up to but not exceeding $2,000,000
at any one time outstanding;
(g) Indebtedness of any Restricted Subsidiary the jurisdiction of
organization of which and the principal place of business of which is
located outside of the United States of America to the extent that such
Indebtedness is incurred to provide working capital for such Restricted
Subsidiary and that the aggregate amount of all such Indebtedness of all
such Restricted Subsidiaries at any one time outstanding does not exceed
the Dollar Equivalent of $10,000,000;
(h) Indebtedness incurred in connection with financing the costs of
insurance premiums in the ordinary course of business and to the extent
customary for Persons situated similarly to SSC and its Restricted
Subsidiaries; and
(i) obligations under incentive, earn-out or other similar
arrangements incurred in connection with acquisitions permitted hereunder,
provided that, if there is a reasonable possibility that the amounts to be
paid thereunder by SSC and its Restricted Subsidiaries will be material,
the same shall have been approved by the Administrative Agent and the
Majority Lenders.
In no event shall SSC or any of its Restricted Subsidiary be liable, directly or
contingently, for any Contingent Repurchase Obligation.
9.08 Investments. SSC will not, nor will it permit any of its
Restricted Subsidiaries to, make or permit to remain outstanding any Investments
except:
(a) Investments outstanding on the date hereof that either (x) are
identified in Part C of Schedule II hereto or (y) have an individual fair
market value less than $200,000 as of the Restatement Effective Date
(provided, that the aggregate fair market value of all such Investments as
of the Restatement Effective Date not identified in said Part C shall not
exceed $1,000,000);
(b) operating deposit accounts with banks;
(c) Permitted Investments;
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(x) Investments by SSC and its Restricted Subsidiaries in or to SSC
and any of its Wholly Owned Subsidiaries that are Restricted Subsidiaries;
(e) Hedging Agreements entered into as bona fide xxxxxx against
fluctuations in interest rates, foreign currency exchange rates or
commodity chemicals prices, and not for speculative purposes;
(f) capital stock of any Person acquired in the Acquisition or in
other acquisitions permitted by Section 9.05 hereof if, after giving
effect thereto, such Person is a Restricted Subsidiary of SSC;
(g) Investments in Restricted Subsidiaries that are not Wholly Owned
Subsidiaries and in joint ventures in an aggregate amount for all such
Restricted Subsidiaries and joint ventures not exceeding at any time
outstanding the sum of $10,000,000 plus the aggregate amount of such
Investments made with the Net Available Proceeds of Debt Issuances;
(h) Investments in Restricted Subsidiaries that are not Wholly Owned
Subsidiaries and in joint ventures made with the Net Available Proceeds of
Equity Issuances;
(i) promissory notes, and earn-out obligations and similar rights,
obtained in connection with sales of Properties permitted hereby;
(j) promissory notes and other securities received in settlement of
disputed claims;
(k) deposits constituting Liens permitted by Section 9.06 hereof;
(l) loans to employees of SSC and its Restricted Subsidiaries in an
amount not exceeding at any one time outstanding $200,000 per employee,
provided that the aggregate amount thereof (together with loans to
employees of SSC and its Restricted Subsidiaries permitted by Section
9.08(a) hereof) for all such employees does not exceed $2,670,315 at any
one time outstanding;
(m) capital stock of, or partnership interests or other equity
interests in, Unrestricted Subsidiaries held by SSC or any of its
Subsidiaries at the respective times the relevant Subsidiaries are
designated Unrestricted
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Subsidiaries (but excluding capital contributions made thereafter);
(n) prepaid expenses incurred and prepaid in the ordinary course of
business; and
(o) additional Investments in an aggregate amount not exceeding
$1,000,000 at any time outstanding.
9.09 Restricted Payments. SSC will not make any Restricted Payment
at any time, except that (a) SSC or any of its Restricted Subsidiaries may make
cash dividends to the Partnership quarterly in respect of each tax year of the
Partnership in an amount equal to the estimated portion of Tax Payment Amount
for the Partnership for such tax payable for such quarter, so long as at least
fifteen days prior to making any such Restricted Payment, SSC shall have
delivered to each Lender (i) notification of the amount and proposed payment
date of such Restricted Payment and (ii) a statement from the chief financial
officer of SSC setting forth a detailed calculation of the estimated portion of
such Tax Payment Amount for such quarter, (b) if no Default shall have occurred
and be continuing or would result therefrom, SSC may make cash dividends to the
Partnership to enable the Partnership to pay Contingent Repurchase Obligations
that have become owing provided that, except to the extent paid with the Net
Available Proceeds of Equity Issuances, such amount paid in any fiscal year of
SSC does not exceed $1,000,000 (provided that the unused availability for
Restricted Payments permitted by this clause (b) for any fiscal year of SSC
(beginning with its fiscal year ending December 31, 1997) may be carried forward
into subsequent years until it is used so long as the aggregate amount of
Restricted Payments made as permitted by this clause (b) (excluding any portion
thereof paid with the Net Available Proceeds of Equity Issuances) does not
exceed $4,000,000 in any fiscal year of SSC, (c) SSC may make the Restricted
Payments referred to in the definition of "Transactions" in Section 1.01 hereof
on the Restatement Effective Date, (d) if no Default shall have occurred and be
continuing or would result therefrom, SSC may make cash dividends to the
Partnership on the dates and in the amounts required to pay Subordinated
Indebtedness of the Partnership, (e) cash distributions to the Partnership to
pay fees and expenses (including directors fees and employee salaries) of the
General Partner and the Partnership and (f) other Restricted Payments in any
fiscal year not to exceed $2,000,000. Not later than October 16 of each year,
SSC shall furnish to the Administrative Agent a certificate of a firm of
independent certified public accountants setting forth in reasonable detail
calculations demonstrating
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that the Tax Payment Amounts paid by SSC in the preceding calendar year were
accurate. In preparing such certificate, such firm may rely on certificates of
independent public accountants for the Partnership (or investor in the
Partnership, as applicable) as to the actual combined marginal Federal, state
and local income tax rates (after giving effect to the deductibility of state
and local income taxes) applicable to the Partnership (or investor, as
applicable) unless such combined rates exceed the highest theoretical combined
marginal Federal, state and local income tax rates (after giving effect to the
deductibility of state and local income taxes), as determined by such firm.
Nothing herein shall be deemed to prohibit the payment of dividends by any
Restricted Subsidiary of SSC to SSC or to any other Restricted Subsidiary of
SSC.
9.10 Certain Financial Covenants.
(a) Leverage Ratio. SSC will not permit the Leverage Ratio to exceed
the following respective ratios at any time during the following respective
periods:
Period Ratio
------ -----
March 31, 1998 through
March 31, 1999 5.75 to 1
April 1, 1999 through
September 30, 1999 5.25 to 1
October 1, 1999 through
June 30, 2000 4.75 to 1
July 1, 2000 through
September 30, 2000 4.50 to 1
October 1, 2000 through
March 31, 2001 4.25 to 1
April 1, 2001 through
June 30, 2001 4.00 to 1
July 1, 2001 through
September 30, 2001 3.75 to 1
October 1, 2001 and
thereafter 3.50 to 1
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(b) Net Worth. SSC will not permit Net Worth to be less than the
following respective amounts at any time during the following respective
periods:
Period Amount
------ ------
Restatement Effective Date
through March 30, 1999 $44,000,000
March 31, 1999 through
September 29, 1999 $46,000,000
September 30, 1999 through
March 30, 2000 $48,000,000
March 31, 2000 through
September 29, 2000 $50,000,000
September 30, 2000 through
March 30, 2001 $52,500,000
March 31, 2001 through
September 29, 2001 $55,000,000
September 30, 2001 through
March 30, 2002 $57,500,000
March 31, 2002 through
September 29, 2002 $60,000,000
September 30, 2002 through
March 30, 2003 $62,500,000
March 31, 2003 through
September 29, 2003 $65,000,000
September 30, 2003 and
thereafter $67,500,000
(c) Interest Coverage Ratio. SSC will not permit the Interest
Coverage Ratio to be less than the following respective ratios as at the last
day of any fiscal quarter ending during the following respective periods:
Period Ratio
------ -----
March 31, 1998 through
March 30, 1999 1.75 to 1
March 31, 1999 through
March 30, 2000 2.00 to 1
March 31, 2000 through
March 30, 2001 2.25 to 1
March 31, 2001 through
March 30, 2002 2.50 to 1
March 31, 2002 through
March 30, 2003 2.75 to 1
March 31, 2003 and
thereafter 3.00 to 1
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9.11 Management Fees. SSC will not permit the aggregate amount of
Management Fees payable in respect of any fiscal year of SSC to exceed $250,000
plus the amount of any reasonable out-of-pocket expenses incurred by the Manager
or any Affiliate of SSC in connection with the operation of the Partnership, SSC
and its Subsidiaries, provided that Management Fees may not be paid (i) more
than quarterly in advance, (ii) at any time after a Default shall have occurred
and be continuing or (iii) to any Person other than the Partnership, First
Chicago Equity Corp., Waud Capital Partners, L.L.C. or Affiliates of First
Chicago Equity Corp. or Waud Capital Partners, L.L.C.
9.12 Capital Expenditures. SSC will not permit the aggregate amount
of Capital Expenditures (excluding Capital Expenditures made from Escrowed
Funds, from the Net Available Proceeds of Casualty Events, Equity Issuances or
Dispositions, from amounts offset against the Seller Note in accordance with the
terms thereof and from amounts received from Persons other than SSC and its
Subsidiaries pursuant to indemnities for Environmental Claims) by SSC and its
Restricted Subsidiaries to exceed for any period set forth below the amount set
forth below opposite such period:
Fiscal Year Amount
----------- ------
1997 $5,500,000
1998 5,500,000
1999 5,000,000
2000 5,000,000
2001 5,000,000
2002 5,000,000
2003 5,000,000
If the aggregate amount of Capital Expenditures for any fiscal year shall be
less than the amount permitted for such fiscal year, then the shortfall shall be
added to the amount of Capital Expenditures permitted for the immediately
succeeding (but not any other) fiscal year and, for purposes hereof, the amount
of Capital Expenditures made during any period shall be deemed to have been made
first from the permitted amount for such fiscal year and last from the amount of
any carryover from any previous fiscal year.
9.13 Holding Company. Notwithstanding anything contained herein to
the contrary, SSC shall at all times be a Holding Company.
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9.14 Subordinated Indebtedness. SSC will not, nor will it permit any
of its Subsidiaries to, purchase, redeem, retire or otherwise acquire for value,
or set apart any money for a sinking, defeasance or other analogous fund for the
purchase, redemption, retirement or other acquisition of, or make any voluntary
payment or prepayment of the principal of or interest on, or any other amount
owing in respect of, any Subordinated Indebtedness, except (subject to the terms
of subordination thereof) for (i) regularly scheduled payments or prepayments of
principal and interest in respect thereof required pursuant to the instruments
evidencing such Subordinated Indebtedness, (ii) offsets against the Seller
Subordinated Note in accordance with the terms thereof and (iii) exchanges of
Senior Subordinated Notes for other Senior Subordinated Notes in accordance with
the Registration Rights Agreement. SSC will not permit any Indebtedness, other
than Indebtedness hereunder, to be "Designated Senior Indebtedness" under, and
as defined in the Senior Subordinated Notes Indenture on the Exchange Securities
Indenture.
9.15 Lines of Business. SSC will not, nor will it permit any of its
Subsidiaries to, engage to any substantial extent in any line or lines of
business activity other than the specialty chemicals products business and
closely related businesses or businesses incidental thereto.
9.16 Transactions with Affiliates. Except as expressly permitted by
this Agreement or as set forth in Schedule IV, SSC will not, nor will it permit
any of its Restricted Subsidiaries to, directly or indirectly: (a) make any
Investment in an Affiliate of SSC; (b) transfer, sell, lease, assign or
otherwise dispose of any Property to an Affiliate of SSC; (c) merge into or
consolidate with or purchase or acquire Property from an Affiliate of SSC; (d)
make any contribution towards, or reimbursement for, any Federal income taxes
payable by any Partner or any of its Subsidiaries in respect of income of SSC;
or (e) enter into any other transaction directly or indirectly with or for the
benefit of an Affiliate of SSC (including, without limitation, Guarantees and
assumptions of obligations of an Affiliate of SSC); provided that (x) any
Affiliate of SSC who is an individual may serve as a director, officer or
employee of SSC or any of its Restricted Subsidiaries and receive reasonable
compensation for his or her services in such capacity and (y) SSC and its
Restricted Subsidiaries may enter into transactions (other than extensions of
credit by SSC or any of its Subsidiaries to an Affiliate of SSC) providing for
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the leasing of Property, the rendering or receipt of services or the purchase or
sale of inventory and other Property in the ordinary course of business if the
monetary or business consideration arising therefrom would be substantially as
advantageous to SSC and its Restricted Subsidiaries as the monetary or business
consideration that would obtain in a comparable transaction with a Person not an
Affiliate of SSC.
9.17 Use of Proceeds. SSC will use the proceeds of the Loans
hereunder solely to provide part of the financing for the Acquisition (including
related fees and expenses), to refinance existing Indebtedness, to finance the
ongoing working capital requirements of SSC and its Restricted Subsidiaries and
to finance other acquisitions permitted hereunder (in compliance with all
applicable legal and regulatory requirements); provided that neither the
Administrative Agent nor any Lender shall have any responsibility as to the use
of any of such proceeds. SSC will use the proceeds of the Acquisition Loans
solely for the purpose of financing acquisitions permitted by Section 9.05(e)
hereof.
9.18 Certain Obligations Respecting Restricted Subsidiaries.
(a) Guarantors. In the event that SSC or any of its Restricted
Subsidiaries shall form or acquire any new Restricted Subsidiary, SSC will cause
such new Restricted Subsidiary (so long as such new Restricted Subsidiary is not
a "controlled foreign corporation" within the meaning of Section 957 of the
Code) to become a "Guarantor" (and, thereby, an "Obligor") hereunder, and to
pledge and grant a security interest in its Property pursuant to the Security
Agreement to the Administrative Agent for the benefit of the Lenders, pursuant
to a written instrument in form and substance satisfactory to the Administrative
Agent and to deliver such proof of corporate action, incumbency of officers,
opinions of counsel and other documents as is consistent with those delivered by
each "Obligor" pursuant to Section 7.01 hereof upon the Restatement Effective
Date or as the Administrative Agent shall have requested.
(b) Ownership of Restricted Subsidiaries. SSC will, and will cause
each of its Restricted Subsidiaries to, take such action from time to time as
shall be necessary to ensure that each of its Restricted Subsidiaries is a
Wholly Owned Subsidiary, except as permitted by Section 9.08 hereof. In the
event that any additional shares of stock, partnership or membership or similar
equity interests shall be issued by any Restricted Subsidiary to any Obligor,
such Obligor agrees forthwith to
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deliver to the Administrative Agent pursuant to the Security Agreement the
certificates evidencing such shares of stock, accompanied by undated stock
powers executed in blank and to take such other action as the Administrative
Agent shall request to perfect the security interest created therein pursuant to
the Security Agreement; provided that, notwithstanding anything contained herein
to the contrary, no capital stock of any "controlled foreign corporation" within
the meaning of Section 957 of the Code (other than 65% of the capital stock of
each class of each such "controlled foreign corporation" directly owned by an
Obligor) shall be pledged under the Security Agreement.
(c) Certain Restrictions. SSC will not permit any of its Restricted
Subsidiaries to enter into, after the date hereof, any indenture, agreement,
instrument or other arrangement that, directly or indirectly, prohibits or
restrains, or has the effect of prohibiting or restraining, or imposes
materially adverse conditions upon, the incurrence or payment of Indebtedness,
the granting of Liens, the declaration or payment of dividends, the making of
loans, advances or Investments or the sale, assignment, transfer or other
disposition of Property, except for any prohibition or restraint as to the
granting of Liens on, or sales, assignments, transfers or other dispositions of,
Property that is covered by a Lien in favor of any other Person (except for SSC
or any of its Subsidiaries or Affiliates) permitted by 9.06 hereof or that is
the subject of a lease with any Person (except for SSC or any of its
Subsidiaries or Affiliates).
9.19 Modifications of Certain Documents. SSC will not consent to
(a) any modification, supplement or waiver of any of the provisions
of the Acquisition Documents,
(b) any modification, supplement or waiver of any of the provisions
of the Investors Agreement, the Equity Documents or the organizational
documents of any Obligor to the extent that such modification, supplement
or waiver is materially adverse to any Obligor or to the interests of the
Administrative Agent or the Lenders or
(c) any modification, supplement or waiver of any of the provisions
of the Subordinated Debt Documents or any agreement, instrument or other
document evidencing or relating to Subordinated Indebtedness, other than
the Subordinated Debt Documents, to the extent that the Administrative
Agent reasonably determines that such
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modification, supplement or waiver is adverse to any Obligor or the
interests of the Administrative Agent or the Lenders.
9.20 Equity Issuance. SSC will not, nor will not permit its
Restricted Subsidiaries to, effect any Equity Issuance, except that SSC may make
an Equity Issuance to the Partnership and, if no Default shall have occurred and
be continuing or would result therefrom, SSC may make a Qualifying Public
Offering.
9.21 Newly-Acquired Real Property.
(a) Not later than 60 days after the date of acquisition, SSC shall
take the following actions with respect to any interests in real property
acquired by SSC or any of its Restricted Subsidiaries after the date hereof (but
excluding (x) real property having a fair market value of less than $500,000 and
(if leased) with annual rental payments of less than $200,000 (provided, that,
the aggregate fair market value of all such real property is less than
$2,000,000 and (if leased) has aggregate annual rental payments of less than
$500,000), and that is not material to the business of such Borrower or
Restricted Subsidiary and (y) real property located outside the United States of
America):
(i) cause such interests to be mortgaged to the Administrative Agent
as security for its obligations under the Loan Documents pursuant to a
mortgage, deed of trust or similar instrument in form and substance
satisfactory to the Administrative Agent in its reasonable judgment;
(ii) in the case of leases under which such owner is lessee, use its
best efforts to cause the respective landlords to execute such estoppel
agreements, cause such leases to be recorded in the appropriate county
land offices and take such other action as the Administrative Agent may
reasonably request to ensure that such leases are "mortgageable", as
determined by the Administrative Agent in its reasonable judgment;
(iii) cause to be issued by and delivered to the Administrative
Agent mortgagee policies of title insurance satisfactory to the
Administrative Agent in form and substance insuring the validity and
first-priority of the Liens created under each of the Mortgages for and in
amounts reasonably satisfactory to the Administrative Agent subject only
to Liens permitted by Section 9.06 hereof and
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containing such affirmative coverage and endorsements as the Lenders may
require;
(iv) cause to be delivered to the Administrative Agent, in respect
of each of the facilities covered by the Mortgages, as-built surveys, or
such other evidence demonstrating to the satisfaction of the
Administrative Agent that the improvements represented to the
Administrative Agent as being located on such facility are in fact located
thereon; and
(v) cause to be executed and delivered to the Administrative Agent
such other documentation as the Administrative Agent may reasonably
request in connection therewith, including, without limitation, Uniform
Commercial Code financing statements, certified corporate resolutions and
other corporate documents of the mortgagor and favorable opinions of
counsel to the mortgagor (which shall cover, among other things, the
legality, validity, binding effect and enforceability of such mortgage,
subject to customary exceptions satisfactory to the Administrative Agent
in its reasonable judgment).
(b) In connection with the foregoing clause (a)(iii) of this Section
9.21, the Borrowers shall pay all expenses and premiums in connection with the
issuance of the title insurance and in addition shall pay the recording and
stamp taxes payable in connection with recording each Mortgage in the
appropriate county land office.
9.22 Governmental Approvals. Each Obligor agrees that it will
promptly obtain from time to time at its own expense all such governmental
licenses, authorizations, consents, permits and approvals as may be required for
such Obligor to (a) comply with its obligations, and preserve its rights under,
each of the Loan Documents and (b) maintain the existence, priority and
perfection of the Liens purported to be created under the Security Documents.
9.23 Appraisal. SSC shall deliver to the Administrative Agent as
soon as available and in any event within 30 days after the Restatement
Effective Date, an appraisal prepared by a firm satisfactory to the
Administrative Agent in form and substance satisfactory to the Administrative
Agent covering the Acquired Facilities owned in fee.
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Xxxxxxx 00. Events of Default. If one or more of the following
events (herein called "Events of Default") shall occur and be continuing:
(a) Any Obligor shall (i) default in the payment when due (whether
at stated maturity or upon mandatory or optional prepayment) of any
principal of any Loan or any Reimbursement Obligation or (ii) default in
the payment when due (whether at stated maturity or upon mandatory or
optional prepayment) of any interest on any Loan or Reimbursement
Obligation, any fee or any other amount payable by them hereunder or under
any other Loan Document and, in the case of this clause (ii), such default
shall continue for two Business Days; or
(b) SSC or any of its Restricted Subsidiaries shall default in the
payment when due of any principal of or interest on any of its other
Indebtedness in an aggregate amount of $2,000,000 or more; or any event
(including the giving of any notice and the lapse of any grace period as
originally in effect (without giving effect to any extension of any such
grace period)) specified in any note, agreement, indenture or other
document evidencing or relating to any such Indebtedness shall occur if
the effect of such event 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, such Indebtedness to become due, or to be prepaid in
full (whether by redemption, purchase, offer to purchase or otherwise),
prior to its stated maturity; or any Obligor shall default in the payment
when due of any amount under any Hedging Agreement that, if terminated,
would result in termination or liquidation payments owing by SSC or any of
its Restricted Subsidiaries in an aggregate amount of $1,000,000 or more;
or any event (including the giving of any notice and the lapse of any
grace period as originally in effect (without giving effect to any
extension of any such grace period))specified in any such Hedging
Agreement shall occur if the effect of such event is to cause, or to
permit, a termination or liquidation payment or payments to become due; or
(c) Any representation, warranty or certification made or deemed
made herein or in any other Loan Document (or in any modification or
supplement hereto or thereto) by any Credit Party, or any certificate
furnished to any Lender or the Administrative Agent pursuant to the
provisions hereof or thereof, shall prove to have been false or misleading
as of the time made or furnished in any material respect; or
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(x) SSC shall default in the performance of any of its obligations
under any of Sections 9.01(f), 9.01(h), 9.05, 9.06, 9.07, 9.08, 9.09,
9.10, 9.11, 9.12, 9.14, 9.16, 9.18 or 9.19 hereof; or any Obligor shall
default in the performance of any of its obligations under Section 4.02 or
5.02 of the Security Agreement; or SSC shall default in the performance of
any of its obligations under Section 4.02 of the Partnership Pledge
Agreement; or any Credit Party shall default in the performance of any of
its other obligations in this Agreement or any other Loan Document and
such default shall continue unremedied for a period of thirty or more days
after notice thereof to SSC by the Administrative Agent or any Lender
(through the Administrative Agent); or
(e) Any Credit Party, any of Significant Restricted Subsidiary or
any Significant Group of Restricted Subsidiaries shall admit in writing
its or their inability to, or be generally unable to, pay its or their
respective debts as such debts become due; or
(f) Any Credit Party, any Significant Restricted Subsidiary or any
Significant Group of Restricted Subsidiaries shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee, examiner or liquidator of itself or themselves or of
all or a substantial part of its or their respective Property, (ii) make a
general assignment for the benefit of its or their respective creditors,
(iii) commence a voluntary case under the Bankruptcy Code, (iv) file a
petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts, (v)
fail to controvert in a timely and appropriate manner, or acquiesce in
writing to, any petition filed against it or them in an involuntary case
under the Bankruptcy Code or (vi) take any corporate action for the
purpose of effecting any of the foregoing; or
(g) A proceeding or case shall be commenced, without the application
or consent of the affected Credit Party, any Significant Restricted
Subsidiary or any Significant Group of Restricted Subsidiaries, in any
court of competent jurisdiction, seeking (i) its or their reorganization,
liquidation, dissolution, arrangement or winding-up, or the composition or
readjustment of its or their debts, (ii) the appointment of a receiver,
custodian, trustee, examiner, liquidator or the like of such Obligor,
Significant
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Restricted Subsidiary or Significant Group of Restricted Subsidiaries or
of all or any substantial part of its Property or (iii) similar relief in
respect of such Obligor, Significant Restricted Subsidiary or Group of
Significant Group of Restricted Subsidiaries under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts, and such proceeding or case shall continue
undismissed, or an order, judgment or decree approving or ordering any of
the foregoing shall be entered and continue unstayed and in effect, for a
period of 60 or more days; or an order for relief against such Obligor,
Significant Restricted Subsidiary or Significant Group of Restricted
Subsidiaries shall be entered in an involuntary case under the Bankruptcy
Code; or
(h) The Partnership shall be terminated, dissolved or liquidated (as
a matter of law or otherwise) or proceedings shall be commenced by any
Person (including the Partnership) seeking the termination, dissolution or
liquidation of the Partnership; or
(i) A final judgment or judgments for the payment of money of
$200,000 or more in the aggregate shall be rendered by one or more courts,
administrative tribunals or other bodies having jurisdiction against SSC
or any of its Restricted Subsidiaries and the same shall not be discharged
(or provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 30 days from the date of
entry thereof and the affected Borrower or Restricted Subsidiary shall
not, within said period of 30 days, or such longer period during which
execution of the same shall have been stayed, appeal therefrom and cause
the execution thereof to be stayed during such appeal; or
(j) An event or condition specified in Section 9.01(e) hereof shall
occur or exist with respect to any Plan or Multiemployer Plan and, as a
result of such event or condition, together with all other such events or
conditions, any Obligor or any ERISA Affiliate shall incur or in the
opinion of the Majority Lenders shall be reasonably likely to incur a
liability to a Plan, a Multiemployer Plan or the PBGC (or any combination
of the foregoing) that, in the determination of the Majority Lenders,
would (either individually or in the aggregate) have a Material Adverse
Effect; or
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(k) There shall have been asserted against SSC or any of its
Subsidiaries an Environmental Claim that, in the judgment of the Majority
Lenders is reasonably likely to be determined adversely to SSC or any of
its Subsidiaries, and the amount thereof (either individually or in the
aggregate) is reasonably likely to have a Material Adverse Effect (insofar
as such amount is payable by SSC or any of its Subsidiaries but after
deducting any portion thereof that is reasonably expected to be paid by
other creditworthy Persons jointly and severally liable therefor); or
(l) A Change of Control shall occur; or
(m) The Liens created by the Security Documents shall at any time
not constitute a valid and perfected Lien on the collateral intended to be
covered thereby (to the extent perfection by filing, registration,
recordation or possession is required herein or therein) in favor of the
Administrative Agent, free and clear of all other Liens (other than Liens
permitted under Section 9.06 hereof or under the respective Security
Documents), or, except for expiration in accordance with its terms, any of
the Security Documents shall for whatever reason be terminated or cease to
be in full force and effect, or the enforceability thereof shall be
contested by any Obligor; or
(n) The Guarantee created under Section 6 hereof or the
subordination provisions of any Subordinated Indebtedness shall be
contested by any Credit Party; or
(o) SSC shall not have received on or before December 31, 1997, as a
contribution to its capital from the Partnership, promissory notes (in
addition to the Management Notes contributed as contemplated by Section
7.01(o) hereof) execited and delivered by management employees of the
Partnership in an aggregate principal amount of at least $170,315 in
exchange for the issuance of limited partnership interests in the
Partnership and capital stock in the General Partner;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (f) or (g) of this Section 10 with respect to any Obligor, the Majority
Lenders may through the Administrative Agent, by notice to the Borrowers,
terminate the Commitments and/or declare the principal amount then outstanding
of, and the accrued interest on, the Loans, the Reimbursement Obligations and
all other amounts payable by the Obligors hereunder and under the Notes
(including, without limitation, any
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amounts payable under Section 5.05 or 5.06 hereof) to be forthwith due and
payable (provided that (x) if so requested by the Majority Revolving Credit
Lenders, the Administrative Agent shall take such action with respect to the
Revolving Credit Commitments and/or the Revolving Credit Loans, Reimbursement
Obligations and such interest and other amounts to the extent owed to the
Revolving Credit Lenders and (y) if so requested by the Majority Term Lenders,
the Administrative Agent shall take such action with respect to the Term Loan
Commitments and the Term Loans and such interest and other amounts to the extent
owed to the Term Loan Lenders), whereupon such amounts shall be immediately due
and payable without presentment, demand, protest or other formalities of any
kind, all of which are hereby expressly waived by the Obligors; and (2) in the
case of the occurrence of an Event of Default referred to in clause (f) or (g)
of this Section 10 with respect to any Obligor, the Commitments shall
automatically be terminated and the principal amount then outstanding of, and
the accrued interest on, the Loans, the Reimbursement Obligations and all other
amounts payable by the Obligors hereunder and under the Notes (including,
without limitation, any amounts payable under Section 5.05 or 5.06 hereof) shall
automatically become immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by each Obligor.
In addition, upon the occurrence and during the continuance of any
Event of Default (if the Administrative Agent has declared the principal amount
then outstanding of, and accrued interest on, the Revolving Credit Loans and all
other amounts payable by the Borrowers hereunder and under the Notes to be due
and payable), the Borrowers agree that they shall, if requested by the
Administrative Agent or the Majority Revolving Credit Lenders through the
Administrative Agent (and, in the case of any Event of Default referred to in
clause (f) or (g) of this Section 10 with respect to any of the Borrowers,
forthwith, without any demand or the taking of any other action by the
Administrative Agent or such Lenders) provide cover for the Letter of Credit
Liabilities by paying to the Administrative Agent immediately available funds in
an amount equal to the then aggregate undrawn face amount of all Letters of
Credit, which funds shall be held by the Administrative Agent in the Collateral
Account as collateral security in the first instance for the Letter of Credit
Liabilities and be subject to withdrawal only as therein provided.
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Xxxxxxx 00. The Administrative Agent. The Administrative Agent and
the Lenders hereby agree among themselves (with no obligation or benefit of or
to SSC or any of its Subsidiaries) as follows:
11.01 Appointment, Powers and Immunities. Each Lender hereby
appoints and authorizes the Administrative Agent to act as its agent hereunder
and under the other Loan Documents with such powers as are specifically
delegated to the Administrative Agent by the terms of this Agreement and of the
other Loan Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent (which term as used in this
sentence and in Section 11.05 and the first sentence of Section 11.06 hereof
shall include reference to its affiliates and its own and its affiliates'
officers, directors, employees and agents):
(a) shall have no duties or responsibilities except those expressly
set forth in this Agreement and in the other Loan Documents, and shall not
by reason of this Agreement or any other Loan Document be a trustee for
any Lender;
(b) shall not be responsible to the Lenders for any recitals,
statements, representations or warranties contained in this Agreement or
in any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any of them under, this
Agreement or any other Loan Document, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement, any Note or any other Loan Document or any other document
referred to or provided for herein or therein or for any failure by the
Borrowers or any other Person to perform any of its obligations hereunder
or thereunder;
(c) shall not, except to the extent expressly instructed by the
Majority Lenders with respect to collateral security under the Security
Documents, be required to initiate or conduct any litigation or collection
proceedings hereunder or under any other Loan Document; and
(d) shall not be responsible to any Lender for any action taken or
omitted to be taken by it hereunder or under any other Loan Document or
under any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own
gross negligence or willful misconduct.
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The Administrative Agent may employ agents and attorneys-in-fact and shall not
be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith. The Administrative Agent may
deem and treat the payee of a Note as the holder thereof for all purposes hereof
unless and until a notice of the assignment or transfer thereof shall have been
filed with the Administrative Agent, together with the consent of the Borrowers
to such assignment or transfer (to the extent required by Section 12.06(b)
hereof).
11.02 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone, telecopy, telegram or
cable) reasonably believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by the Administrative Agent. As to any matters not expressly provided
for by this Agreement or any other Loan Document, the Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by the Majority
Lenders or, if provided herein, in accordance with the instructions given by the
Majority Revolving Credit Lenders, the Majority Term Lenders or all of the
Lenders as is required in such circumstance, and such instructions of such
Lenders and any action taken or failure to act pursuant thereto shall be binding
on all of the Lenders.
11.03 Defaults. The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default unless the Administrative
Agent has received notice from a Lender or SSC specifying such Default and
stating that such notice is a "Notice of Default". In the event that the
Administrative Agent receives such a notice of the occurrence of a Default, the
Administrative Agent shall give prompt notice thereof to the Lenders and to SSC.
The Administrative Agent shall (subject to Sections 11.07 and 12.04 hereof) take
such action with respect to such Default as shall be directed by the Majority
Lenders or, if provided herein, the Majority Revolving Credit Lenders or the
Majority Term Lenders, provided that, unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default as it shall deem advisable in the best interest of the
Lenders except to the extent that this Agreement expressly requires that such
action be taken, or not be taken, only with the consent or upon the
authorization of the Majority Lenders,
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the Majority Revolving Credit Lenders, the Majority Term Lenders or all of the
Lenders.
11.04 Rights as a Lender. With respect to its Commitments and the
Loans made by it, Chase (and any successor acting as Administrative Agent) in
its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Administrative Agent, and the term "Lender" or "Lenders" shall,
unless the context otherwise indicates, include the Administrative Agent in its
individual capacity. Chase (and any successor acting as Administrative Agent)
and its affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Obligors (and any of their
Subsidiaries or Affiliates) as if it were not acting as the Administrative
Agent, and Chase (and any such successor) and its affiliates may accept fees and
other consideration from the Obligors for services in connection with this
Agreement or otherwise without having to account for the same to the Lenders.
11.05 Indemnification. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed under Section 12.03 hereof,
but without limiting the obligations of the Borrowers under said Section 12.03)
ratably in accordance with the aggregate principal amount of the Loans and
Reimbursement Obligations held by the Lenders (or, if no Loans or Reimbursement
Obligations are at the time outstanding, ratably in accordance with their
respective Commitments), for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever that may be imposed on, incurred by or
asserted against the Administrative Agent (including by any Lender) arising out
of or by reason of any investigation in or in any way relating to or arising out
of this Agreement or any other Loan Document or any other documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or
thereby (including, without limitation, the costs and expenses that the
Borrowers are obligated to pay under Section 12.03 hereof, but excluding, unless
a Default has occurred and is continuing, normal administrative costs and
expenses incident to the performance of its agency duties hereunder) or the
enforcement of any of the terms hereof or thereof or of any such other
documents, provided that no Lender shall be liable for any of the foregoing to
the extent they arise from the gross negligence or willful misconduct of the
party to be indemnified.
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11.06 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of SSC
and its Subsidiaries and decision to enter into this Agreement and that it will,
independently and without reliance upon the Administrative Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own analysis and decisions in taking or not
taking action under this Agreement or under any other Loan Document. The
Administrative Agent shall not be required to keep itself informed as to the
performance or observance by any Obligor of this Agreement or any of the other
Loan Documents or any other document referred to or provided for herein or
therein or to inspect the Properties or books of SSC or any of its Subsidiaries.
Except for notices, reports and other documents and information expressly
required to be furnished to the Lenders by the Administrative Agent hereunder or
under the Security Documents, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the affairs, financial condition or business of SSC or any of its
Subsidiaries (or any of their affiliates) that may come into the possession of
the Administrative Agent or any of its affiliates.
11.07 Failure to Act. Except for action expressly required of the
Administrative Agent hereunder and under the other Loan Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 11.05 hereof against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action.
11.08 Resignation or Removal of Administrative Agent. Subject to the
appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Borrowers, and the Administrative Agent may be removed at
any time with or without cause by the Majority Lenders. Upon any such
resignation or removal, the Majority Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Majority Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent's giving of
notice of resignation or the Majority Lenders' removal of the
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retiring Administrative Agent, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, that shall be a
bank that has an office in New York, New York with a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. After any retiring Administrative Agent's resignation
or removal hereunder as Administrative Agent, the provisions of this Section 11
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as the Administrative Agent.
11.09 Consents under Other Loan Documents. Except as otherwise
provided in Section 12.04 hereof with respect to this Agreement, the
Administrative Agent may, with the prior consent of the Majority Lenders (but
not otherwise), consent to any modification, supplement or waiver under any of
the Loan Documents, provided that, without the prior consent of each Lender, the
Administrative Agent shall not (except as provided herein or in the Security
Documents) release all or any substantial part of the collateral or otherwise
terminate any Lien under any Security Document providing for collateral
security, agree to additional obligations being secured by such collateral
security (unless the Lien for such additional obligations shall be junior to the
Lien in favor of the other obligations secured by such Security Document, in
which event the Administrative Agent may consent to such junior Lien provided
that it obtains the consent of the Majority Lenders thereto), alter the relative
priorities of the obligations entitled to the benefits of the Liens created
under the Security Documents, except that no such consent shall be required, and
the Administrative Agent is hereby authorized, (a) to release any Lien covering
Property that is the subject of either a disposition of Property permitted
hereunder or a disposition to which the Majority Lenders have consented and (b)
to terminate the obligations of any Guarantor hereunder if such Guarantor ceases
to be a Subsidiary of SSC by reason of the sale of all of the capital stock of
such Subsidiary owned by SSC and its Subsidiaries in a disposition permitted
hereunder or to which the Majority Lenders have consented.
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Section 12. Miscellaneous.
12.01 Waiver. No failure on the part of the Administrative Agent or
any Lender to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power or privilege under this Agreement or any Note shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege under this Agreement or any Note preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
Each Obligor irrevocably waives, to the fullest extent permitted by
applicable law, any claim that any action or proceeding commenced by the
Administrative Agent or any Lender relating in any way to this Agreement should
be dismissed or stayed by reason, or pending the resolution, of any action or
proceeding commenced by any Obligor relating in any way to this Agreement
whether or not commenced earlier. To the fullest extent permitted by applicable
law, the Obligors shall take all measures necessary for any such action or
proceeding commenced by the Administrative Agent or any Lender to proceed to
judgment prior to the entry of judgment in any such action or proceeding
commenced by any Obligor.
12.02 Notices. All notices, requests and other communications
provided for herein and under the Security Documents (including, without
limitation, any modifications of, or waivers, requests or consents under, this
Agreement) shall be given or made in writing (including, without limitation, by
telecopy) delivered to the intended recipient at the "Address for Notices"
specified below its name on the signature pages hereof (below the name of SSC,
in the case of any Obligor); or, as to any party, at such other address as shall
be designated by such party in a notice to each other party. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
12.03 Expenses, Etc. The Borrowers agree to pay or reimburse (a) the
Administrative Agent for all reasonable out-of-pocket costs and expenses of the
Administrative Agent (including, without limitation, the reasonable fees and
expenses of Milbank, Tweed, Xxxxxx & XxXxxx, special New York counsel to Chase)
in connection with (i) the negotiation, preparation, execution and delivery of
this Agreement and the other Loan
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Documents and the extension of credit hereunder and (ii) the negotiation or
preparation of any modification, supplement or waiver of any of the terms of
this Agreement or any of the other Loan Documents (whether or not consummated);
(b) each of the Lenders and the Administrative Agent for all reasonable
out-of-pocket costs and expenses of the Lenders and the Administrative Agent
(including, without limitation, the reasonable fees and expenses of legal
counsel) in connection with (i) any Default and any enforcement or collection
proceedings resulting therefrom, including, without limitation, all manner of
participation in or other involvement with (x) bankruptcy, insolvency,
receivership, foreclosure, winding up or liquidation proceedings, (y) judicial
or regulatory proceedings and (z) workout, restructuring or other negotiations
or proceedings (whether or not the workout, restructuring or transaction
contemplated thereby is consummated) and (ii) the enforcement of this Section
12.03; (c) each of the Lenders and the Administrative Agent for all transfer,
stamp, documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement or any of the
other Loan Documents or any other document referred to herein or therein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated by any Security Document or any other document referred to therein;
and (d) the Administrative Agent for all costs, expenses and other charges in
respect of title insurance procured with respect to the Liens created pursuant
to the Mortgages.
The Borrowers hereby agree to indemnify the Administrative Agent and
each Lender and their respective directors, officers, employees, attorneys and
agents from, and hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them (including,
without limitation, any and all losses, liabilities, claims, damages or expenses
incurred by the Administrative Agent to any Lender, whether or not the
Administrative Agent or any Lender is a party thereto) arising out of or by
reason of any investigation or litigation or other proceedings (including any
threatened investigation or litigation or other proceedings) relating to the
extensions of credit hereunder or any actual or proposed use by SSC or any of
its Subsidiaries of the proceeds of any of the extensions of credit hereunder,
including, without limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation or litigation or other
proceedings (but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross
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negligence or willful misconduct of the Person to be indemnified).
Notwithstanding the foregoing, with respect to environmental matters, the
Borrowers will indemnify the Administrative Agent and each Lender from, and hold
the Administrative Agent and each Lender harmless against, any losses,
liabilities, claims, damages or expenses described in the preceding sentence
(including any Lien filed against any Property covered by the Mortgages or any
part of the Trust Estate thereunder in favor of any governmental entity, but
excluding, as provided in the preceding sentence, any loss, liability, claim,
damage or expense incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified) arising under any Environmental Law
as a result of the past, present or future operations of SSC or any of its
Subsidiaries (or any predecessor in interest to SSC or any of its Subsidiaries),
or the past, present or future condition of any site or facility owned, operated
or leased at any time by SSC or any of its Subsidiaries (or any such predecessor
in interest), or any Release or threatened Release of any Hazardous Materials at
or from any such site or facility, excluding any such conditions or Release or
threatened Release that shall arise or occur during any period when the
Administrative Agent or any Lender shall be in possession of any such site or
facility following the exercise by the Administrative Agent or any Lender of any
of its rights and remedies hereunder or under any of the Security Documents, but
including any such Release or threatened Release occurring during such period
that is a continuation of conditions previously in existence or of practices
employed by SSC and its Subsidiaries, at such site or facility, except for such
conditions or practices that may be unlawful or negligent and which the
Borrowers have disclosed to the Administrative Agent and the Lenders prior to
the exercise of the administrative remedies.
12.04 Amendments, Etc. Except as otherwise expressly provided in
this Agreement, any provision of this Agreement may be modified or supplemented
only by an instrument in writing signed by SSC, the Borrowers and the Majority
Lenders, or by SSC, the Borrowers and the Administrative Agent acting with the
consent of the Majority Lenders, and any provision of this Agreement may be
waived by the Majority Lenders or by the Administrative Agent acting with the
consent of the Majority Lenders; provided that: (a) no modification, supplement
or waiver shall, unless by an instrument signed by all of the Lenders or by the
Administrative Agent acting with the consent of all of the Lenders: (i)
increase, or extend the term of any of the Commitments, or extend the time or
waive any requirement for the reduction or termination of any of the
Commitments, (ii) extend the date fixed for the payment of principal of or
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interest on any Loan, the Reimbursement Obligations or any fee hereunder, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at
which interest is payable thereon or any fee is payable hereunder, (v) alter the
rights or obligations of the Borrowers to prepay Loans, (vi) alter the manner in
which payments or prepayments of principal, interest or other amounts hereunder
shall be applied as between the Lenders or Types or Classes of Loans, (vii)
alter the terms of this Section 12.04, (viii) modify the definition of the term
"Majority Lenders", "Majority Revolving Credit Lenders" or "Majority Term
Lenders", or modify in any other manner the number or percentage of the Lenders
required to make any determinations or waive any rights hereunder or to modify
any provision hereof, (ix) release any Guarantor from any of its guarantee
obligations under Section 6 hereof, unless all of the capital stock of such
Guarantor has been acquired by a Person other than SSC or any of its
Subsidiaries as permitted hereunder, or (x) waive any of the conditions
precedent set forth in Section 7.01 hereof; (b) any modification or supplement
of Section 11 hereof, or of any of the rights or duties of the Administrative
Agent hereunder, shall require the consent of the Administrative Agent; and (c)
any modification or supplement of Section 6 hereof shall require the consent of
each Guarantor.
12.05 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
12.06 Assignments and Participations.
(a) No Obligor may assign any of its rights or obligations hereunder
or under the Notes without the prior consent of all of the Lenders and the
Administrative Agent.
(b) Each Lender may assign any of its Loans, its Notes, its
Commitments, and, if such Lender is a Revolving Credit Lender, its Letter of
Credit Interest (but only with the consent of the Borrowers and the
Administrative Agent (which consents shall not be unreasonably withheld) and, in
the case of the Revolving Credit Commitment or a Letter of Credit Interest, the
Issuing Bank); provided that
(i) no such consent by the Borrowers or the Administrative Agent
shall be required in the case of any assignment to another Lender or an
affiliate of another Lender;
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(xx) except to the extent the Borrowers and the Administrative Agent
shall otherwise consent, any such assignment (other than to another Lender
or to an affiliate of another Lender) shall be in an amount at least equal
to $5,000,000 or if less, the amount of the Commitments, Loans and Letters
of Credit Interests of such Lender and its affiliates;
(iii) each such assignment by a Lender of its Revolving Credit
Loans, Revolving Credit Note, Revolving Credit Commitment or Letter of
Credit Interest shall be made in such manner so that the same portion of
its Revolving Credit Loans, Revolving Credit Note, Revolving Credit
Commitment and Letter of Credit Interest is assigned to the respective
assignee;
(iv) each such assignment by a Lender of its Term Loans or Term Loan
Commitment shall be made in such manner so that the same portion of its
Term Loans and Term Loan Commitment is assigned to the respective
assignee; and
(v) upon each such assignment, the assignor and assignee shall
deliver to the Borrowers, the Administrative Agent and the Issuing Bank an
Assignment and Acceptance in the form of Exhibit F hereto.
Upon execution and delivery by the assignor and the assignee to the Borrowers,
the Administrative Agent and the Issuing Bank of such Assignment and Acceptance,
and upon consent thereto by the Borrowers, the Administrative Agent and the
Issuing Bank to the extent required above, the assignee shall have, to the
extent of such assignment (unless otherwise consented to by the Borrowers, the
Administrative Agent and the Issuing Bank), the obligations, rights and benefits
of a Lender hereunder holding the Commitment(s), Loans and, if applicable,
Letter of Credit Interest (or portions thereof) assigned to it and specified in
such Notice of Assignment (in addition to the Commitment(s), Loans and Letter of
Credit Interest, if any, theretofore held by such assignee) and the assigning
Lender shall, to the extent of such assignment, be released from the
Commitment(s) (or portion(s) thereof) so assigned. Upon each such assignment the
assigning Lender shall pay the Administrative Agent an assignment fee of $3,000.
(c) A Lender may sell or agree to sell to one or more other Persons
(each a "Participant") a participation in all or any part of any Loans or Letter
of Credit Interest held by it, or in its Commitments (but only with the consent
of the Borrowers
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(which consents shall not be unreasonably withheld)), provided that such
Participant shall not have any rights or obligations under this Agreement or any
Note or any other Loan Document (the Participant's rights against such Lender in
respect of such participation to be those set forth in the agreements executed
by such Lender in favor of the Participant). All amounts payable by the
Borrowers to any Lender under Section 5 hereof in respect of Loans, Letter of
Credit Interest held by it, and its Commitments, shall be determined as if such
Lender had not sold or agreed to sell any participations in such Loans, Letter
of Credit Interest and Commitments, and as if such Lender were funding each of
such Loan, Letter of Credit Interest and Commitments in the same way that it is
funding the portion of such Loan, Letter of Credit Interest and Commitments in
which no participations have been sold. In no event shall a Lender that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Loan Document except that such Lender may
agree with the Participant that it will not, without the consent of the
Participant, agree to (i) increase or extend the term of such Lender's related
Commitment, (ii) extend the date fixed for the payment of principal of or
interest on the related Loan or Loans, Reimbursement Obligations or any portion
of any fee hereunder payable to the Participant, (iii) reduce the amount of any
such payment of principal, (iv) reduce the rate at which interest is payable
thereon, or any fee hereunder payable to the Participant, to a level below the
rate at which the Participant is entitled to receive such interest or fee or (v)
consent to any modification, supplement or waiver hereof or of any of the other
Loan Documents to the extent that the same, under Section 11.09 or 12.04 hereof,
requires the consent of each Lender.
(d) In addition to the assignments and participations permitted
under the foregoing provisions of this Section 12.06, any Lender may (without
notice to the Borrowers, the Administrative Agent or any other Lender and
without payment of any fee) (i) assign and pledge all or any portion of its
Loans and its Notes to any Federal Reserve Bank as collateral security pursuant
to Regulation A and any Operating Circular issued by such Federal Reserve Bank
and (ii) assign all or any portion of its rights under this Agreement and its
Loans and its Notes to an affiliate. No such assignment shall release the
assigning Lender from its obligations hereunder.
(e) A Lender may furnish any information concerning SSC or any of
its Subsidiaries in the possession of such Lender from time to time to assignees
and participants (including prospective assignees and participants, but only if
the Borrowers
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have consented to the respective prospective assignees and participants),
subject, however, to the provisions of Section 12.13(b) hereof.
(f) Anything in this Section 12.06 to the contrary notwithstanding,
no Lender may assign or participate any interest in any Loan or Reimbursement
Obligation held by it hereunder to SSC or any of its Affiliates or Subsidiaries
without the prior consent of each Lender.
12.07 Survival. The obligations of the Borrowers under Sections
5.01, 5.05, 5.06, 5.07 and 12.03 hereof, the obligations of each Guarantor under
Section 6.03 hereof, and the obligations of the Lenders under Section 11.05
hereof, shall survive the repayment of the Loans and Reimbursement Obligations
and the termination of the Commitments and, in the case of any Lender that may
assign any interest in its Commitments, Loans or Letter of Credit Interest
hereunder, shall survive the making of such assignment, notwithstanding that
such assigning Lender may cease to be a "Lender" hereunder. In addition, each
representation and warranty made, or deemed to be made by a notice of any
extension of credit (whether by means of a Loan or a Letter of Credit), herein
or pursuant hereto shall survive the making of such representation and warranty,
and no Lender shall be deemed to have waived, by reason of making any extension
of credit hereunder (whether by means of a Loan or a Letter of Credit), any
Default that may arise by reason of such representation or warranty proving to
have been false or misleading, notwithstanding that such Lender or the
Administrative Agent may have had notice or knowledge or reason to believe that
such representation or warranty was false or misleading at the time such
extension of credit was made.
12.08 Captions. The table of contents and captions and section
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
12.09 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
12.10 Governing Law; Submission to Jurisdiction. This Agreement and
the Notes shall be governed by, and construed in accordance with, the law of the
State of New York. Each Obligor hereby submits to the nonexclusive jurisdiction
of the United
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000
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Xxxxxx Xxxxxxxx Xxxxx for the Southern District of New York and of the Supreme
Court of the State of New York sitting in New York County (including its
Appellate Division), and of any other appellate court in the State of New York,
for the purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each Obligor hereby
irrevocably waives, to the fullest extent permitted by applicable law, any
objection that it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
12.11 Waiver of Jury Trial. EACH OF THE OBLIGORS, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
12.12 Limitation of Liability. It is understood that, except for the
Collateral (as defined in each of the Security Documents) and except for
representations and warranties made by the Partnership in the Partnership Pledge
Agreement and except for any guarantees of the obligations of the Borrowers
hereunder that the Administrative Agent and the Lenders may have received, the
sole recourse of the Administrative Agent and the Lenders in respect of the
obligations of the Borrowers hereunder shall be to the assets of the Borrowers
and to the Collateral under the Security Documents and that nothing contained
herein shall create any obligation of or right to look to any Partner or its
assets individually for the satisfaction of such obligations.
12.13 Treatment of Certain Information; Confidentiality.
(a) The Obligors acknowledge that from time to time financial
advisory, investment banking and other services may be offered or provided to
SSC or one or more of its Subsidiaries or Affiliates (in connection with this
Agreement or otherwise) by any Lender or by one or more subsidiaries or
affiliates of such Lender and, subject to the further written consent of SSC
(the granting or withholding of which consent shall be in the sole discretion of
SSC), the Obligors hereby authorize each Lender to share any information
delivered to such Lender by SSC and its Subsidiaries pursuant to this Agreement,
or in connection with the decision of such Lender to enter into this Agreement,
to any
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such subsidiary or affiliate, it being understood that any such subsidiary or
affiliate receiving such information shall be bound by the provisions of
paragraph (b) below as if it were a Lender hereunder. Such authorization shall
survive the repayment of the Loans and Reimbursement Obligations and the
termination of the Commitments.
(b) Each Lender and the Administrative Agent agrees (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Obligors pursuant to this
Agreement, provided that nothing herein shall limit the disclosure of any such
information (i) after such information shall have become public (other than
through a violation of this Section 12.13 or a Confidentiality Agreement
substantially in the form of Exhibit E hereto), (ii) to the extent required by
statute, rule, regulation or judicial process, (iii) to counsel for any of the
Lenders or the Administrative Agent, (iv) to bank examiners (or any other
regulatory authority having jurisdiction over any Lender or the Administrative
Agent), or to auditors or accountants, (v) to the Administrative Agent or any
other Lender (or to Chase Securities Inc.), (vi) in connection with any
litigation to which any one or more of the Lenders or the Administrative Agent
is a party, or in connection with the enforcement of rights or remedies
hereunder or under any other Loan Document, (vii) to a subsidiary or affiliate
of such Lender as provided in paragraph (a) above or (viii) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant (or prospective assignee or participant) first executes and delivers
to the respective Lender a Confidentiality Agreement substantially in the form
of Exhibit E hereto and a copy thereof has been furnished to SSC; provided,
further, that (x) unless specifically prohibited by applicable law or court
order, each Lender and the Administrative Agent shall, prior to disclosure
thereof, notify SSC of any request for disclosure of any such non-public
information (A) by any governmental agency or representative thereof (other than
any such request in connection with an examination of the financial condition of
such Lender by such governmental agency) or (B) pursuant to legal process and
(y) in no event shall any Lender or the Administrative Agent be obligated or
required to return any materials furnished by any Obligor. The obligations of
any assignee that has executed a Confidentiality Agreement in the form of
Exhibit E hereto shall be superseded by this
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Section 12.13 upon the date upon which such assignee becomes a Lender hereunder
pursuant to Section 12.06(b) hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
SOVEREIGN SPECIALTY CHEMICALS, INC.
By: /s/ Xxxxxx Xxxxxx
Title: President, Chairman,
CEO
Address for Notices:
Sovereign Specialty Chemicals, L.P.
000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
With copies to:
First Chicago Equity Capital
Three First Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Attention: Xxxx Xxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
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First Chicago Equity Corporation
One First National Plaza
00xx Xxxxx
Xxxx Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Xxxxx, Xxxxxx & Xxxxxx LLP
0000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000
Attention: X. Xxxxx Xxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
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151
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SIA ADHESIVES, INC.
By: /s/ Xxxxxx Xxxxxx
Title: Chairman
Address for Notices:
SIA Adhesives, Inc.
000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
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XXXXXX & XXXXXXX CORP.
By: /s/ Xxxxxx Xxxxxx
Title: Chairman
Address for Notices:
Xxxxxx & Xxxxxxx Corp.
000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
Credit Agreement
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LENDERS
Revolving Credit Commitment THE CHASE MANHATTAN BANK
---------------------------
$4,250,000.00
Term Loan Commitment By: /s/ Xxxxxx X. Xxxxx
-------------------- Title: Managing Director
$4,250,000.00
Lending Office for all Loans:
The Chase Manhattan Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Address for Notices:
The Chase Manhattan Bank
The Loan and Agency Services
Group
1 Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telecopier No.: (000) 000-0000
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Revolving Credit Commitment XXXXXX TRUST AND SAVINGS BANK
---------------------------
$3,750,000.00
Term Loan Commitment By: /s/ Xxxxxx X. Xxxxx
-------------------- Title: Vice President
$3,750,000.00
Lending Office for all Loans:
Xxxxxx Trust & Savings
000 X. Xxxxxx Xxxxxx
Xxxxx 00X
Xxxxxxx, XX 00000
Address for Notices:
Xxxxxx Trust & Savings
000 X. Xxxxxx Xxxxxx
Xxxxx 00X
Xxxxxxx, XX 00000
Attention: Xxx Xxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
155
- 150 -
Revolving Credit Commitment LASALLE NATIONAL BANK
---------------------------
$3,750,000.00
Term Loan Commitment By: /s/ Xxxxxxxx X. Xxxxxx
-------------------- Title: Assistant Vice
$3,750,000.00 President
Lending Office for all Loans:
LaSalle National Bank
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Address for Notices:
LaSalle National Bank
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
156
- 151 -
Revolving Credit Commitment BANK OF AMERICA NATIONAL TRUST
--------------------------- AND SAVINGS ASSOCIATION
$3,750,000.00
Term Loan Commitment By: /s/ Xxxxxx Xxxxx
-------------------- Title: Senior Vice
$3,750,000.00 President
Lending Office for all Loans:
Bank of America
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Address for Notices:
Bank of America
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
157
- 152 -
Revolving Credit Commitment BHF-BANK AKTIENGESELLSCHAFT
---------------------------
$3,000,000.00
Term Loan Commitment By: /s/ Xxxxx Xxxx
-------------------- Title: Vice President
$3,000,000.00
By: /s/ Xxxx Xxxxx
Title: Assistant Vice
President
Lending Office for all Loans:
BHF Bank
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Address for Notices:
BHF Bank
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
158
- 153 -
Revolving Credit Commitment CAISSE NATIONALE DE CREDIT
--------------------------- AGRICOLE
$3,000,000.00
Term Loan Commitment By: /s/ Xxxxx Xxxxx
-------------------- Title: F.V.P., Head of
$3,000,000.00 Corporate Banking,
Chicago
Lending Office for all Loans:
Credit Agricole
00 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Address for Notices:
Credit Agricole
00 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention: Xxxxx Xxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
159
- 154 -
Revolving Credit Commitment BANKBOSTON, N.A.
---------------------------
$3,000,000.00
Term Loan Commitment By: /s/ C. Xxxxxx Piculelle
-------------------- Title: Vice President
$3,000,000.00
Lending Office for all Loans:
The Bank of Boston
000 Xxxxxxx Xxxxxx
XX00-00-00
Xxxxxx, XX 00000-0000
Address for Notices:
The Bank of Boston
000 Xxxxxxx Xxxxxx
XX00-00-00
Xxxxxx, XX 00000-0000
Attention: Xxx Xxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
160
- 155 -
Revolving Credit Commitment NATIONAL CITY BANK
---------------------------
$3,000,000.00
Term Loan Commitment By: /s/ Xxxxxx X. Xxxxxxx
-------------------- Title: Account Officer
$3,000,000.00
Lending Office for all Loans:
National City Bank
0000 X. 0xx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, XX 00000
Address for Notices:
National City Bank
0000 X. 0xx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Attention: Xxxxxx Xxxxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
161
- 156 -
Revolving Credit Commitment XXX XXXXXX AMERICAN CAPITAL
--------------------------- PRIME RATE INCOME TRUST
$2,500,000.00
Term Loan Commitment By: /s/ Xxxxxxx X. Xxxxxxx
-------------------- Title: Senior Vice President
& Director
$2,500,000.00
Lending Office for all Loans:
Xxx Xxxxxx American Capital
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Address for Notices:
Xxx Xxxxxx American Capital
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
Credit Agreement
162
- 157 -
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: /s/ Xxxxxx X. Xxxxx
Title: Managing Director
Address for Notices to
Chase as Administrative Agent:
The Chase Manhattan Bank
Loan and Agency Services Group
1 Chase Xxxxxxxxx Xxxxx,
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Telephone No.: (000) 000-0000
Credit Agreement
163
SCHEDULE I
Material Agreements and Liens
[See Sections 8.11, 9.06(b) or 9.07(b)]
Part A - Indebtedness
None.
Part B - Liens
LIEN SCHEDULE
XXXXXX & XXXXXXX CORP.
Date Jurisdiction Debtor Secured Party Property Covered
---- ------------ ------ ------------- ----------------
9-26-94 Erie County, New York Xxxxxx & Xxxxxxx Corp. GE Capital/LeaseAmerica Copier (2), sorter
(2)
0-00-00 Xxxxx xx Xxx Xxxx Xxxxxx & Xxxxxxx Corp. GE Capital/LeaseAmerica Xxxxxx copier (2)
No. 195940 sorter (2)
0-00-00 Xxxxx xx Xxx Xxxx Xxxxxx & Xxxxxxx Corp. FINOVA Capital IBM software,
No. 138167 Corporation hardware, disk
drive, disk unit
7-11-96 Erie County, New York Xxxxxx & Xxxxxxx Corp. FINOVA Capital IBM software,
Book 26 Page 5663 Corporation hardware, disk
drive, disk unit
0-00-00 Xxxxx xx Xxx Xxxx Xxxxxx & Xxxxxxx Corp. Manufacturers & Traders Sharp projector
No. 161645 Trust Co. w/carry case
Schedule I
164
- 2 -
8-20-96 Erie County, New York Xxxxxx & Xxxxxxx Corp. Manufacturers & Traders Sharp projector
Book 27 Page 5819 Trust Co. w/carry case
0-00-00 Xxxxx xx Xxx Xxxx Xxxxxx & Xxxxxxx Corp. Business Methods, Inc. 2 Konica copiers
No. 129077
XXXXXXX CONSTRUCTION CHEMICALS NORTH AMERICA, INC.
Date Jurisdiction Debtor Secured Party Property Covered
---- ------------ ------ ------------- ----------------
4-27-92 Lake County, Ohio Xxxxxxx Construction Hastings Industries Property located
Mechanic's Lien No. Chemicals North at 7405 Production
9210308841 America, Inc. Drive, Mentor,
Ohio
6-12-95 Dept. of Licensing, Xxxxxxx Construction Associates Leasing Inc. Forklift
Olympia, WA Chemicals North
No. 00-000-0000 America, Inc.
0-00-00 Xxxx Xxxxxx, Xxxx Xxxxxxx Xxxxxxxxxxxx Xxxxx Financial Xxxxxx and Toshiba
No. 97194943 Chemicals North Services, Inc. copier systems
America, Inc.
1-15-95 Lake County, Ohio Lapote (sic) Associates Leasing, Forklift
No. 95181094 Construction Chemicals Inc.
North America, Inc.
3-11-93 Lake County, Ohio Xxxxxxx Construction Xxxx Atlantic Tricon Canon Copier
No. 93170394 Chemical Leasing Corporation
3-15-93 Ohio Xxxxxxx Construction Xxxx Atlantic Tricon Canon Copier
AK 04258 Chemical Leasing Corporation
----------
1. See attached letter dated April 23, 1997 to Xx. Xxxx Xxxxxx.
Schedule I
165
- 3 -
5-12-95 Ohio Xxxxxxx Construction First United Leasing Rider Scrubber
AL 85255 Chemicals North Corp.
America, Inc.
6-12-95 Ohio Xxxxxxx Construction Associates Leasing, Specific Equipment
AL 92895 Chemicals North Inc.
America, Inc. (dba
Ohio Sealants)
6-12-95 Ohio Ohio Sealants, Inc. Toyota Motor Credit Forklift
AL 92581 Corp.
6-12-95 Ohio Xxxxxxx Construction Associates Leasing, Specific equipment
AL 92895 Chemicals North Inc.
America, Inc. (dba:
Ohio Sealants)
XXXXXX PRODUCTS COMPANY, INC.
Date Jurisdiction Debtor Secured Party Property Covered
---- ------------ ------ ------------- ----------------
9-3-92 Florida Xxxxxx Products Florida forklift trucks
No. 920000179669 Company Inc. Clarklift, Inc.
12-8-92 Florida Xxxxxx Products Advanta Leasing UPS shipping system
No. 920000251621 Company Inc. Corp.
12-7-94 Florida Xxxxxx Products Florida forklift trucks
No. 940000246477 Company Inc. Clarklift, Inc.
12-19-94 Florida Xxxxxx Products Florida Pallet Truck
No. 940000255246 Company Inc. Clarklift Inc.
Schedule I
166
- 4 -
1-30-95 Secretary of State Xxxxxx Products Xxxxx Credit
California Company Inc. Corporation walkie pallet truck
No. 0000000000
1-30-95 Secretary of State Xxxxxx Products Xxxxx Credit CROWN electric
California Company Inc. Corporation counterbalanced
No. 9503760367 stockpicker
1-30-95 Florida Xxxxxx Products Florida Pallet Truck
No. 950000021323 Company Inc. Clarklift Inc.
1-30-95 Florida Xxxxxx Products Florida Electric
No. 950000021324 Company Inc. Clarklift Inc. Stockpicker
3-17-95 Florida Xxxxxx Products Florida Poly load wheel
No. 950000054168 Co. Inc. Clarklift Inc. walkie pallet truck
3-17-95 Florida Xxxxxx Products Florida Poly load wheel
No. 950000054171 Co Inc. Clarklift Inc. walkie pallet truck
3-17-95 Florida Xxxxxx Products Florida forklift
No. 950000054174 Co Inc. Clarklift Inc. truck
3-17-95 Florida Xxxxxx Products Florida forklift
No. 950000054176 Co Inc Clarklift Inc. truck
7-5-95 Florida Xxxxxx Products Florida counterbalanced
No. 950000133815 Co Inc Clarklift Inc. stockpicker
7-5-95 Florida Xxxxxx Products Florida walkie
No. 950000133817 Co Inc Clarklift Inc. pallet truck
11-1-95 Florida Xxxxxx Products Florida stand-up rider
No. 950000220577 Co Inc Clarklift Inc. forklift truck
Schedule I
167
- 5 -
2-19-96 Florida Xxxxxx Products Florida poly load wheel
No. 960000034805 Co Inc Clarklift Inc. forklift truck
2-19-96 Florida Xxxxxx Products Florida poly load wheel
No. 960000034806 Co. Inc. Clarklift Inc. forklift truck
2-19-96 Florida Xxxxxx Products Florida poly load wheel
No. 960000034807 Co. Inc. Clarklift Inc. forklift truck
2-19-96 Florida Xxxxxx Products Florida poly load wheel
No. 960000034809 Co. Inc. Clarklift Inc. forklift truck
9-9-96 Florida Xxxxxx Products Associates Stockpicker
No. 960000189681 Co Inc. Commercial Corp
9-9-96 Florida Xxxxxx Products Associates Rider Reach Truck
No. 960000189682 Co Inc. Commercial Corp
9-25-96 Florida Xxxxxx Products Credential Leasing Telephone System
No. 960000201519 Company Inc. Corp. of Florida
Inc.
10-9-96 Florida Xxxxxx Products Associates Leasing Lift Truck
No. 960000212589 Co Inc. Inc.
EVODE-XXXXXX INDUSTRIES, INC.
4-20-93 South Carolina Evode-Xxxxxx, Inc. Xxxx Atlantic IBM system
105548A Tricon Leasing
3-28-96 South Carolina Evode-Xxxxxx Xxxxx Leasing Panasonic equipment
160041A Industries, Inc. Company
1-18-93 South Carolina Evode-Xxxxxx Xxxxx Rental Lift truck
Schedule I
168
- 6 -
123439A Industries, Inc. System, Inc.
11-14-94 South Carolina Evode-Xxxxxx Yale Financial Forklift
150928A Industries, Inc. Services, Inc.
Schedule I
169
SCHEDULE II
Subsidiaries and Investments
[See Sections 8.14 and 9.08(a)]
Part A - Capitalization
(a) Equity Rights
1. Pursuant to the BAIC/MIG Partnership Unit Purchase Agreement, MIG
Partners II and BankAmerica Investment Corporation have certain
anti-dilution rights and registration rights for their Units.
2. Waud Capital Partners, L.L.C. has a carried interest pursuant to the
Partnership Agreement on distributions made to the holders of Class
A Common Units.
3. 445.12 Class C Common Units have been reserved for issuance to
future executives of the Partnership.
4. The Amended & Restated Investors Agreement provides each of the
Limited Partners with preemptive rights on the issuance of
additional Units (with certain exceptions).
5. The Partnership Unit Purchase Agreement provides for the issuance
and sale of additional Preferred Units upon a call by the General
Partner.
(b) Redemption Rights
1. Pursuant to Section 8 of the Amended & Restated Investor's
Agreement, Waud Capital Partners-I, L.P. and Waud Capital Partners,
L.L.C. have the right to cause the Partnership to repurchase their
Units for the fair market value thereof.
2. Pursuant to Section 4 of the Executive Securities Agreements, dated
as of March 31, 1997, with each of Xxxxxx Cobalt and Xxxxxxx Xxxxxx
and the Executive Securities Agreements, dated as of July 31, 1997,
with each of Xxxxxx Cobalt, Xxxxxxx Xxxxxx, Xxxxx Xxxx, Xxxxx Xxxxx,
Xxxx Xxxxx, Xxxx Xxxxx, Xxxxxx Xxxxxx, Xxxx Xxxxxxxxx, Xxxx Xxxxxx,
Xxxxxxx Xxxxxxxx, Xxxxxxx Xxxxxxxx, and Xxxxxxx Xxxxxxx, each of
such executives
Schedule II
170
- 2 -
has the right to require the Partnership to repurchase their Units
after their termination from employment without cause or resignation
with good reason, or, in the case of Xxxxxxx Xxxxxxx, nonrenewal of
the employment period.
Part B - Subsidiaries
(a) List of Subsidiaries
1. SIA Adhesives, Inc. ("SIA") is a Delaware corporation. The
authorized capital stock of SIA consists of 1,000 shares of common
stock, $.01 per share. All of the outstanding capital stock (1,000
shares of common stock) of SIA is owned by SSC.
2. Xxxxxx & Xxxxxxx Corp. ("Xxxxxx & Xxxxxxx") is a New York
corporation. The authorized capital stock of Xxxxxx & Xxxxxxx
consists of 200 shares of common stock, no par value per share. All
of the outstanding capital stock (200 shares of common stock) of
Xxxxxx & Xxxxxxx is owned by SSC.
3. Xxxxxx & Xxxxxxx Holding Corporation de Mexico S.A. de C.V. ("P&S
Mexico") is a corporation incorporated under the laws of Mexico.
Xxxxxx & Xxxxxxx is the owner of 49,500 pesos fixed and 16,936,073
peso variable shares of the capital stock of P&S Mexico (or the
total amount of shares in pesos of 16,985,573) and Xxxxxx & Xxxxxxx
de Mexico S.A. de C.V. is the owner of 500 shares of P&S Mexico (all
of which are fixed). The par value of each share is one peso per
share.
4. Xxxxxx & Xxxxxxx de Mexico S.A. de C.V. is a corporation
incorporated under the laws of Mexico. P&S Mexico is the owner of
49,999 pesos fixed and 16,791,060 pesos variable shares of the
capital stock of Xxxxxx & Xxxxxxx de S.A. de C.V. (a total amount of
shares in pesos of 16,841,059) and Xxxxxx & Xxxxxxx is the owner of
one peso fixed and no pesos variable shares of capital stock of
Xxxxxx & Xxxxxxx X.X. de C.V. The par value of each share is one
peso per share.
Schedule II
171
- 3 -
5. Xxxxxx & Xxxxxxx de Mexico S.A. de C.V. is a corporation
incorporated under the laws of Mexico. P&S Mexico is the owner of
49,999 pesos fixed and no pesos variable shares of the capital stock
of Xxxxxx & Xxxxxxx de Mexico S.A. de C.V. and Xxxxxx & Xxxxxxx is
the owner of one peso fixed and no pesos variable shares of capital
stock of Xxxxxx & Xxxxxxx X.X. de C.V. P&S Mexico is the owner of
all of the outstanding capital stock of Xxxxxx & Xxxxxxx Corporation
S.A. de C.V. (consisting of one share of capital stock (49,999 pesos
fixed and no pesos variable, or a total amount in pesos of
16,841,059)). The par value of each share is one peso per share.
6. Laporte Construction Chemicals North America, Inc. ("LCCNA") is an
Illinois corporation. The authorized capital stock of LCCNA consists
of 5,000,000 shares of common stock, no par value per share. All of
the outstanding capital stock of LCCNA (505,980) is owned by SSC.
7. Evode-Xxxxxx Industries, Inc. ("Evode") is a New Hampshire
corporation. The authorized capital stock of Evode-Xxxxxx consists
of 300 shares of common stock, with a par value of $1.00 per share.
All of the outstanding capital stock of Evode-Xxxxxx (270) is owned
by SSC.
8. Xxxxxx Products Company, Inc. ("Xxxxxx") is a New Jersey
corporation. The authorized capital stock of Xxxxxx consists of
1,000 shares of common stock, with a par value of $.10 per share.
All of the outstanding capital stock of Xxxxxx (10) is owned by SSC.
9. Sovereign Specialty Chemicals (SPte. Ltd) ("SPTE") is a corporation
incorporated under the laws of Singapore. The authorized capital
stock of SPTE consists of 100,000 shares of common stock, $1.00 par
value per share. All of the outstanding capital stock of SPTE
(100,000) is owned by SSC.
(b) Equity Rights
Schedule II
172
- 4 -
Part C - Investments
Receivable dated April 26, 1996 in the principal amount of
$71,723.23 from Xxxxx X. Xxxxx.
Xxxxxx Products Company, Inc.
Xxxxxx Products Company, Inc. owns one (1) share of Pine Xxxxxxx
Golf Estates, Inc./ Stock Certificate No. 1445 issued April 29,
1986. This share is owned in connection with a country club
membership.
Schedule II
173
SCHEDULE III
Real Property
[See Section 8.16]
Real Property
A. Owned Property:
1. 000 Xxxx Xxxxxxx Xxxxxx
Xxxxx, Xxxx
as more fully described in Chicago Title Insurance Company Policy
No. 0248049M, dated August 21, 1996.
Owner: Engineered Adhesives, Inc.
2. Xxxxxxxxxx Xxxx
Xxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000
as more fully described in Chicago Title Insurance Company Policy
No. 9681-00450, dated August 27, 1996.
Owner: Xxxxxx & Xxxxxxx Corp., a New York corporation, f/k/a
Xxxxxx & Xxxxxxx Chemical Corp. [Xxxxxxx County
Industrial Development Authority, a Body Politic and
Corporate existing under the laws of the Commonwealth of
Pennsylvania, as to Parcel B]
3. 000 Xxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
as more fully described in Chicago Title Insurance Company Policy
No. 9613-25049, dated August 21, 1996.
Owner: Xxxxxx & Xxxxxxx Inc. and Xxxxxx & Xxxxxxx Corp., f/k/a
Xxxxxx & Xxxxxxx Chemical Corp.
4. 000 Xxxx Xxxxx Xxxxxxxxx
Xxxxx Xxxxxx, Xxxxxxxx 00000
as more fully described in Chicago Title Insurance Company Policy
No. 1410 009608337 dated August 26, 1996.
Owner: Xxxxxx & Xxxxxxx Corp., f/k/a Xxxxxx & Xxxxxxx Chemical Corp.
Schedule III
174
- 2 -
5. 0000 Xxxxxxxxxx Xxxxx - Xxxxxx 0
Xxxxxx, Xxxx 00000
as more fully described in Chicago Title Insurance Company Commit
No. 0207433C, dated August 5, 1997
Owner: Laporte Construction Chemicals North America, Inc.
Sublot No. 9 -- Tyler Industrial Park located on Division Drive
adjacent to property listed above.
as more fully described in Chicago Title Insurance Company
Commitment No. 0207429C, dated August 5, 1997
Owner: Laporte Construction Chemicals North America, Inc.
6. 0000 Xxxxxxxxx Xxxxx
XxXxxxxx, Xxxxxxx 00000
as more fully described in Chicago Title Insurance Company
Commitment No. 51446, dated August 5, 1997
Owner: Laporte Construction Chemicals North America, Inc.
7. 00000 Xxxxx Xxxx 00
Xxxxxxxx, Xxxxxxx 00000
as more fully described in Chicago Title Insurance Company
Commitment No. 5097307000M, dated August 5, 1997
Owner: Xxxxxx Products Company, Inc.
B. Leased Property:
1. Xxxxx xx Xxxxxxxxx Xx. 0
Colonial Loma Xxxxx
Naucalpan de Xxxxxx
X.X. 00000-Xxxxxx Xxxx, Xxxxxx
Lessor: Xxxxxx del Xxxxx Canal Figaredo
Lessee: Xxxxxx & Xxxxxxx de Mexico S.A. de C.V.
2. 000 Xxxxxxxx Xxxxxxxx Xxxx
Schedule III
000
- 0 -
Xxxxxxxx, XX 00000
as more fully described in short term lease between Xxxxxx & Xxxxxxx
Corp. and Xxxxxxx-Xxxxxxxx Company
Lessor: Xxxxxxx-Xxxxxxxx Company
Lessee: Xxxxxx & Xxxxxxx Corp.
3. 13.8 acres on the Southeastern side of Xxxxxx Xxxx Road
Greenville, South Carolina
Lessor: United Carolina Bank of South Carolina, as Trustee
Lessee: Evode-Xxxxxx Industries, Inc.
4. 0.2 acres (along railroad)
News, Greenville County, South Carolina
Lessor: Seaboard Coast Line Railroad Company
Lessee: Evode-Xxxxxx Industries, Inc.
5. 0000 Xxxxxxxxx Xxxxxxx
Xxxxx 000
Xxxxx Xxxxx, Xxxxxxxx 00000
Lessor: Xxx X. Xxxxx, Xx. and Xxxxxxx X. Xxxxx as Trustees
Lessee: Laporte Construction Chemicals North America, Inc.
6. 00000 X.X. 00xx
Xxxxxxx, Xxxxxxxxxx 00000
Lessor: Puget Pacific, Inc. Trustees
Sublessor: Kasco Corporation
Sublessee: Laporte Construction Chemicals North America, Inc.
d/ba Ohio Sealants (OSI)
Sub-Sublessee: Genie Industries, Inc.
Schedule III
176
- 4 -
7. 0000 X. Xxxxxxx Xxxx.
Xxx Xxxxxxx, Xxxxxxxxxx
Lessor: Rockwood Industries, Inc.
Lessee: Laporte Construction Chemicals North America, Inc.
(Glaze 'N Seal Division)
8. 0000 Xxxxxxxxxx
Xxxxxx Xxxxxxxxx, Xxxxxxxxxx 00000
Lessor: The Childs Family Trust u/t/a of 4/30/81 and The
X.X. Xxxxxxx Family Trust u/t/a 3/5/81 dba LANDCO
Lessee Xxxxxx Products Co., Inc.
9. Premises including a portion of Building 10 at the River Terminal
Facility
Kearny, New Jersey
Lessor: RTC Properties, Inc.
Lessee Xxxxxx Products Co., Inc.
Schedule III
177
SCHEDULE IV
List of Affiliate Transactions
[See Section 9.16]
1. Payment of Brokerage Fees equal to an aggregate of $325,000, plus interest
at the rate of 10% per annum from April 1, 1996, to First Chicago Equity
Corporation, Waud Capital Partners, L.L.C. and Xxxxxx Xxxxxx.
2. Executives Securities Agreement dated March 31, 1996 among Xxxxxx Xxxxxx
("Xxxxxx"), the Partnership and the General partner.
3. Executive Securities Agreement dated March 31, 1996 among Xxxxxxx Xxxxxx
("Xxxxxx"), the Partnership and the General Partner.
4. Executive Security Agreements, dated as of July 31, 1997, among the
Partnership, the General Partner, and each of Xxxxxx Cobalt, Xxxxxxx
Xxxxxx, Xxxxx Xxxx, Xxxxx Xxxxx, Xxxx Xxxxx, Xxxx Xxxxx, Xxxxxx Xxxxxx,
Xxxx Xxxxxxxxx, Xxxx Xxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxxx Xxxxxxxx, and
Xxxxxxx Xxxxxxx.
5. Director Security Agreements, dated as of July 31, 1997 and November 1,
1996, among the Partnership, the General Partner, and each of Xxxx Xxxx,
Xxxxxxx Xxxxx, Xx. and Xxxx Xxxxxxxx.
6. Consultant Security Agreements, dated as of July 31, 1997 and November 1,
1996, among the Partnership, the General Partner, and Xxxxxx Xxxxxx-Xxxxx.
7. Employment Agreement dated March 31, 1996 among Xxxxxx, the Partnership
and the General Partner.
8. Employment Agreement dated March 31, 1996 among Xxxxxx, the Partnership
and the General Partner.
9. Employment Agreement dated March 31, 1996 between Xxxxxx and SEA.
10. Employment Agreements dated August 19, 1996 between each of Messrs. Xxxxxx
and Xxxxxxxx and Xxxxxx & Xxxxxxx.
11. Future Executive Securities Agreements (in forms similar to existing
agreements) in connection with future purchases of up to any of the
foregoing:
Schedule IV
178
- 2 -
(i) 445-12 Class C Common Units of the Partnership
(ii) 44.96 Class A Common Shares of the General Partner
12. Future Employment Agreements with senior executives of the Partnership and
its Subsidiaries.
13. Tax payments made pursuant to either (i) the Partnership Agreement; (ii)
the SEA Operating Agreement; or (iii) any other flow-through entity
subsequently acquired by the Partnership.
14. Partnership Unit Purchase Agreement of the Partnership dated March 31,
1996, as amended.
15. BAIC/MIG Partnership Unit Purchase Agreement of the Partnership dated
August 19, 1996 among the General Partner, the Partnership, MIG Partners
II and BankAmerica Investment Corporation.
16. Stock Purchase Agreement of the General Partner dated March 31, 1996, as
amended.
17. BAIC/MIG Stock Purchase Agreement dated August 19, 1996 among the General
Partner, MIG Partner II and BankAmerica Investment Corporation.
18. Promissory Note dated as of March 31, 1996 from Xxxxxx to the Partnership.
19. Promissory Notes, dated as of July 31, 1997 from each of Xxxxxx Cobalt,
Xxxxxxx Xxxxxx(2), Xxxxx Xxxx, and Xxxxxxx Xxxxxxx to the Partnership.
20. Partnership Unit Purchase and Exchange Agreement of the Partnership, dated
as of July 31, 1997.
21. Stock Purchase and Exchange Agreement of the General Partner dated as of
July 31, 1997.
Schedule IV
179
SCHEDULE V
Environmental Matters
[See Section 8.12]
[Schedule from Existing Credit Agreement to be inserted]
Laporte Construction Chemicals North America, Inc.
Mentor, Ohio
1. Mentor facility has three (3) underground storage tanks.
2. Potential liability at Willow Drum Superfund Site.
Evode-Xxxxxx Industries, Inc.
1. On May 12, 1994, Evode received a General Notice and Request for
Information Letter with respect to the Love Springs Site in Cherokee
County, South Carolina, from the South Carolina Department of Health and
Environmental Control, dated May 6, 1994.
On June 21, 1991, Xxxxxx Chemical received a potential Responsible Party
Notice with respect to the White Chemical Superfund Site from the United
States Environmental Protection Agency.
On July 12, 1991, Xxxxxx Chemical received a Request for information with
respect to the White Chemical Superfund Site from the United States
Environmental Protection Agency.
2. Re: Xxxxxx Xxxx, Greenville County, South Carolina Property
(a) Consent Agreement 94-49-HW dated November 21, 1994 between the South
Carolina Department of Health and Environmental Control and Evode.
(b) Release, Settlement and Guarantee Agreement dated June 14, 1995 by
and among Evode U.S.A. Inc., Evode, Xxxxxxx Inc. (as guarantor),
Xxxxxxx Xxxxxxx, United Carolina Bank of South Carolina (as
Successor Trustee under an irrevocable trust between Xxxxxx Xxxxxxx,
Xx. and United Carolina Bank), United Carolina Bank (as Trustee of
that certain revocable trust agreement dated October 20, 0000
xxxxxxx Xxxxxx Xxxxxxx, Xx. xxx Xxxxxx Xxxxxxxx Bank) and The Estate
of Xxxxxx Xxxxxxx, Xx.) and United Carolina Bank of South Carolina.
(c) Release and Settlement Agreement dated October 24, 1996 as filed in
the U.S. District Court for the District of
Schedule X
000
- 0 -
Xxxxx Xxxxxxxx/Xxxxxxxxxx Division in connection with Civil Action
No. 6:00-0000-00.
3. Re: Medley Farm Superfund Site, Gaffney, South Carolina
(a) Agreement and Release dated December 31, 1986 by and between the
"Settling Defendants" (Including Xxxxxx Chemical Company).
(b) Medley Farm Superfund Site Cost Sharing Agreement dated July 31,
1992 entered into by Xxxxxxx X. Xxxx, the Estate of Xxxxxx Xxxxxxx,
Xx. and Evode-Xxxxxx.
(c) Release and Settlement Agreement dated October 24, 1996 as filed in
the U.S. District Court for the District of South
Carolina/Greenville Division in connection with Civil Action No.
6:00-0000-00.
All Target Companies
All matters disclosed in or arising out of facts and circumstances discussed in
the following environmental reports:
Environmental Review
Darworth Company
LaGrange, Georgia E098-068
Prepared by Delta Environmental Consultants, Inc.
October 1996
Environmental Review
Evode-Xxxxxx Industries
Greenville, South Carolina E096-068
Prepared by Delta Environmental Consultants, Inc.
October 1996
Environmental Review
LCCNAI - Mentor
Mentor, Ohio E096-068
Prepared by Delta Environmental Consultants, Inc.
October 1996
Environmental Review
Xxxxxx Products Company, Inc.
Eustis, Florida E098-068
Prepared by Delta Environmental Consultants, Inc.
October 1996
Schedule V
181
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Environmental Review
Xxxxxx Products Company, Inc.
Laporte Construction Chemicals North America, Inc.
Leased Warehouses: Redmond, Washington; South Kearny, New
Jersey; Rancho Cucamonga, California
Delta Project No. E096-068
Prepared by Delta Environmental Consultants, Inc.
October 1996
Additional Liability to be Indemnified by Laporte pursuant to the
Acquisition Agreement:
The following Third Party Claims (as such term is defined in the Acquisition
Agreement) with respect to the facility indicated have been disclosed to the
Partnership and will be subject to indemnification by Laporte in accordance with
the Acquisition Agreement (The Partnership will have Principal Management (as
defined in the Acquisition Agreement) of each of the following):
1. Xxxxx Xxxxxx Industries, Inc. -- Greenville, SC
(a) Fifty percent of repair costs for deformed structural beam in
building 4. The Partnership's share of such costs will not be
applied towards the thresholds specified in Section 8.4(a)(iv) of
the Acquisition Agreement.
2. Darworth Company, La Grange, GA
(a) Third-Party Claims resulting from the fact that required storm water
sampling was not completed in 1996.
(b) Third-Party Claims resulting from possible organic solvent
contamination occurring prior to the closing of the Acquisition
Agreement within subsurface of the drainage ditch adjacent to the
tank farm, as described in the Environmental Review of the Darworth
Company by Delta Environmental consultants, Inc., dated October
1996.
3. Xxxxxx, Eustis, FL
(a) Third-Party Claims brought during the six-month period following
closing of the Acquisition Agreement regarding the OSHA citation
prior to such closing relating to electrical wiring practices.
Xxxxxx will
Schedule V
182
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take corrective action responsive to such citation prior to such
closing.
4. LCCNA, Mentor, OH
(a) Third-Party Claims regarding the one-half of the underground storage
tank that possibly does not meet Ohio UST regulations, unless LCCNA
obtains regulatory approval of the existing system prior to the
closing of the Acquisition Agreement (and LCCNA will use its
reasonable efforts to obtain such approval).
(b) Third-Party Claims resulting from mineral spirits spill (prior to
the closing of the Acquisition Agreement) associated with UST's.
Schedule V
