CREDIT AGREEMENT
DATED AS OF NOVEMBER 17, 1999
BY AND AMONG
XXXXXXXXX INTERNATIONAL, INC.
(THE "BORROWER"),
AS BORROWER
AND
EACH OF THE FINANCIAL INSTITUTIONS INITIALLY A
SIGNATORY HERETO, TOGETHER WITH THOSE ASSIGNEES
PURSUANT TO SECTION 13.06 HEREOF,
AS LENDERS
AND
SOUTHTRUST BANK, NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT AND FUNDING AGENT
TABLE OF CONTENTS
SECTION PAGE
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.02. GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE II
REVOLVING CREDIT FACILITY
SECTION 2.01. REVOLVING CREDIT FACILITY . . . . . . . . . . . . . . . . . . 16
SECTION 2.02. BORROWINGS UNDER REVOLVING CREDIT FACILITY. . . . . . . . . . 17
SECTION 2.03. DISBURSEMENTS UNDER REVOLVING CREDIT FACILITY.. . . . . . . . 17
SECTION 2.04. SEVERAL OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.05. REPAYMENT OF REVOLVING LOANS. . . . . . . . . . . . . . . . . 18
SECTION 2.06. REVOLVING NOTES . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.07. TERM LOAN FACILITY. . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.08. TERM NOTES. . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.09. TERM LOAN AMORTIZATION AND MATURITY . . . . . . . . . . . . . 19
SECTION 2.10. INTEREST ON LOANS . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.11. NOTICE OF CONTINUATION AND NOTICE OF CONVERSION/
UNAVAILABILITY OF CERTAIN LOANS/FUNDING LOSSES . . . . . . . . . . . . 21
SECTION 2.12. VOLUNTARY REDUCTION OF REVOLVING COMMITMENT; VOLUNTARY
PREPAYMENTS; FUNDING LOSSES. . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.13. UNUSED REVOLVING CREDIT FACILITY FEES . . . . . . . . . . . . 23
ARTICLE III
LETTER OF CREDIT FACILITY
SECTION 3.01. LETTERS OF CREDIT/LENDERS' PARTICIPATION. . . . . . . . . . . 23
SECTION 3.02. METHOD OF ISSUANCE OF LETTERS OF CREDIT . . . . . . . . . . . 24
SECTION 3.03. LETTER OF CREDIT FEES.. . . . . . . . . . . . . . . . . . . . 25
SECTION 3.04. LETTER OF CREDIT REIMBURSEMENT. . . . . . . . . . . . . . . . 25
SECTION 3.05. NATURE OF LETTER OF CREDIT ISSUER'S DUTIES. . . . . . . . . . 26
SECTION 3.06. OBLIGATIONS ABSOLUTE. . . . . . . . . . . . . . . . . . . . . 27
SECTION 3.07. EXPIRATION DATE OF LETTERS OF CREDIT. . . . . . . . . . . . . 27
SECTION 3.08. VOLUNTARY REDUCTION OF L/C COMMITMENT . . . . . . . . . . . . 28
ARTICLE IV
OTHER LOAN AND PAYMENT PROVISIONS
SECTION 4.01. INTEREST ON OVERDUE PAYMENTS. . . . . . . . . . . . . . . . . 28
SECTION 4.02. COMPUTATIONS. . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 4.03. USURY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 4.04. PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.05. PRO RATA TREATMENT. . . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.06. SHARING OF PAYMENTS, ETC. . . . . . . . . . . . . . . . . . . 29
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SECTION 4.07. INSUFFICIENT FUNDS. . . . . . . . . . . . . . . . . . . . . . 30
SECTION 4.08. FEES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 4.09. [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . . . . . 30
SECTION 4.10. INCREASED COSTS . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 4.11. STATEMENTS OF ACCOUNT . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.12. DEFAULTING LENDER'S STATUS. . . . . . . . . . . . . . . . . . 31
SECTION 4.13. AGENT'S RELIANCE. . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE V
CONDITIONS PRECEDENT
SECTION 5.01. CONDITIONS PRECEDENT TO EFFECTIVENESS . . . . . . . . . . . . 32
SECTION 5.02. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS . . . . . . . . . . 33
SECTION 5.03. CONDITIONS AS COVENANTS . . . . . . . . . . . . . . . . . . . 33
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01. REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . 33
SECTION 6.02. SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC.. . . . . . . 37
ARTICLE VII
AFFIRMATIVE COVENANTS
SECTION 7.01. PRESERVATION OF EXISTENCE AND SIMILAR MATTERS . . . . . . . . 37
SECTION 7.02. COMPLIANCE WITH APPLICABLE LAW. . . . . . . . . . . . . . . . 37
SECTION 7.03. MAINTENANCE OF PROPERTY . . . . . . . . . . . . . . . . . . . 38
SECTION 7.04. CONDUCT OF BUSINESS . . . . . . . . . . . . . . . . . . . . . 38
SECTION 7.05. INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 7.06. PAYMENT OF TAXES AND CLAIMS . . . . . . . . . . . . . . . . . 38
SECTION 7.07. VISITS AND INSPECTIONS. . . . . . . . . . . . . . . . . . . . 38
SECTION 7.08. USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 7.09. INTEREST RATE PROTECTION. . . . . . . . . . . . . . . . . . . 39
SECTION 7.10. SUBSIDIARY SECURITIES REGISTRATION. . . . . . . . . . . . . . 39
ARTICLE VIII
INFORMATION
SECTION 8.01. QUARTERLY REPORTS . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 8.02. YEAR-END STATEMENTS. . . . . . . . . . . . . . . . . . . . . . 39
SECTION 8.03. BORROWING BASE CERTIFICATE. . . . . . . . . . . . . . . . . . 40
SECTION 8.04. COPIES OF OTHER REPORTS . . . . . . . . . . . . . . . . . . . 40
SECTION 8.05. NOTICE OF LITIGATION AND OTHER MATTERS. . . . . . . . . . . . 40
SECTION 8.06. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE IX
NEGATIVE COVENANTS
SECTION 9.01. INDEBTEDNESS FOR BORROWED MONEY . . . . . . . . . . . . . . . 41
SECTION 9.02. GUARANTIES. . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.03. INVESTMENTS . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.04. LIENS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
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SECTION 9.05. RESTRICTED DISTRIBUTIONS AND PURCHASES. . . . . . . . . . . . 42
SECTION 9.06. MERGER, CONSOLIDATION AND OTHER ARRANGEMENTS. . . . . . . . . 42
SECTION 9.07. PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.08. LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.09. SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.10. TRANSACTIONS WITH AFFILIATES. . . . . . . . . . . . . . . . . 42
SECTION 9.11. NO SALE OF ASSETS . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 9.12. CHANGE IN ACCOUNTING METHOD OR FISCAL YEAR END. . . . . . . . 43
SECTION 9.13. CHANGE OF SENIOR MANAGEMENT OR CONTROL. . . . . . . . . . . . 43
SECTION 9.14. CHANGE IN ORGANIZATIONAL DOCUMENTS. . . . . . . . . . . . . . 43
SECTION 9.15. ADDITIONAL SUBSIDIARIES EQUITIES. . . . . . . . . . . . . . . 43
ARTICLE X
FINANCIAL COVENANTS
SECTION 10.01. MINIMUM TANGIBLE NET WORTH . . . . . . . . . . . . . . . . . 43
SECTION 10.02. INTEREST COVERAGE RATIO. . . . . . . . . . . . . . . . . . . 44
SECTION 10.03. FIXED CHARGE COVERAGE. . . . . . . . . . . . . . . . . . . . 44
SECTION 10.04. FUNDED DEBT RATIO. . . . . . . . . . . . . . . . . . . . . . 44
SECTION 10.05. FUNDED DEBT TO EBITDA. . . . . . . . . . . . . . . . . . . . 44
ARTICLE XI
DEFAULT
SECTION 11.01. EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . 44
SECTION 11.02. REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 11.03. RIGHTS CUMULATIVE . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE XII
THE AGENT
SECTION 12.01. AUTHORIZATION AND ACTION . . . . . . . . . . . . . . . . . . 47
SECTION 12.02. AGENT'S RELIANCE, ETC. . . . . . . . . . . . . . . . . . . . 47
SECTION 12.03. AGENT AS LENDER. . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 12.04. LENDER CREDIT DECISION, ETC. . . . . . . . . . . . . . . . . 48
SECTION 12.05. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 12.06. COLLATERAL MATTERS . . . . . . . . . . . . . . . . . . . . . 49
SECTION 12.07. SUCCESSOR AGENT. . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE XIII
MISCELLANEOUS
SECTION 13.01. NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 13.02. EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 13.03. STAMP, INTANGIBLE AND RECORDING TAXES. . . . . . . . . . . . 52
SECTION 13.04. SETOFF . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 13.05. LITIGATION . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 13.06. ASSIGNABILITY. . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 13.07. AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 13.08. NONLIABILITY OF AGENT AND LENDERS. . . . . . . . . . . . . . 56
SECTION 13.09. INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 13.10. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . . 56
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SECTION 13.11. SURVIVAL . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 13.12. TITLES AND CAPTIONS. . . . . . . . . . . . . . . . . . . . . 56
SECTION 13.13. SEVERABILITY OF PROVISIONS . . . . . . . . . . . . . . . . . 56
SECTION 13.14. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 13.15. COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 13.16. OBLIGATIONS WITH RESPECT TO BORROWER . . . . . . . . . . . . 57
SECTION 13.17. BINDING EFFECT . . . . . . . . . . . . . . . . . . . . . . . 57
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of November 17, 1999 by and among XXXXXXXXX
INTERNATIONAL, INC. (the "BORROWER"), SOUTHTRUST BANK, NATIONAL ASSOCIATION, as
Administrative Agent and Funding Agent (collectively "AGENT"), and each of the
financial institutions initially a signatory hereto, together with those
Assignees pursuant to Section 13.06 hereof (individually, a "LENDER" and,
collectively, the "LENDERS").
WHEREAS, the Borrower, SouthTrust, as Agent, and the Lenders, have agreed
to make Term and Revolving Loans to the Borrower from time to time, the Letter
of Credit Issuers agreed to issue Letters of Credit from time to time for the
account of the Borrower, and the Lenders agreed to purchase participating
interests in such Letters of Credit, provided that the aggregate outstanding
principal amount of all such Revolving Loans and Term Loans PLUS the aggregate
Stated Amounts of all outstanding Letters of Credit, would not exceed
$71,000,000 (the "LOAN COMMITMENT");
WHEREAS, the Borrower, the Lenders and the Agent wish to set forth their
agreements as to the Revolving Loans, the Term Loans and the Letters of Credit
on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. In addition to terms defined elsewhere herein,
the following terms shall have the following meanings for the purposes of this
Agreement:
"ACCOUNTS" means all accounts and any and all rights to the payment of
money or other forms of consideration of any kind (whether classified under the
Uniform Commercial Code as accounts, chattel paper, general intangibles, or
otherwise) for goods sold or leased or for services rendered including, but not
limited to, accounts receivable, proceeds of any letters of credit naming the
Borrower or any of its Subsidiaries as beneficiary, chattel paper, tax refunds,
insurance proceeds, contract rights, notes, drafts, instruments, documents,
acceptances, all contract rights and agreements to purchase or sell Inventory,
and all other debts, obligations and liabilities in whatever form from any
Person.
"ACCOUNT DEBTOR" means a Person obligated under an Account.
"ADJUSTED BASE RATE" means a rate equal to the Base Rate plus the
Applicable Margin.
"ADJUSTED EURODOLLAR RATE" means the interest rate per annum equal to the
Eurodollar Rate plus the Applicable Margin.
"AFFILIATE" means, with respect to any Person, any entity which directly or
indirectly controls, is controlled by, or is under common control with, such
Person or any Subsidiary of such Person or any Person who is a director, officer
or partner of such Person or any Subsidiary of such Person. For
1
purposes of this definition, "control" shall mean the possession, directly or
indirectly, of the power to (a) vote ten percent (10%) or more of the securities
having ordinary voting power for the election of directors of such Person or
(b) direct or cause the direction of management and policies of a business,
whether through the ownership of voting securities, by contract or otherwise and
either alone or in conjunction with others or any group.
"AGENT" means SouthTrust Bank, National Association and its successors.
"AGREEMENT" means this Credit Agreement as it may be amended, restated,
modified or supplemented from time to time in accordance with its terms.
"AGREEMENT DATE" means the date as of which this Agreement is dated.
"APPLICABLE LAW" means all applicable provisions of constitutions,
statutes, rules, regulations and orders of all Governmental Authorities and all
orders and decrees of all courts, tribunals and arbitrators.
"APPLICABLE MARGIN" shall mean:
The percentage per annum designated below based on the Borrower's Funded Debt to
EBITDA ratio for the four (4) fiscal quarter periods most recently ended:
Funded Applicable Margin Applicable Margin
Level Debt/EBIT Revolving Loans Term Loans
DA
-----------------------------------------------------------------------------------
Eurodollar Base Unused Eurodollar Base
Rate Rate Revolver Fee Rates Rate
-----------------------------------------------------------------------------------
I GREATER THAN
OR EQUAL TO 4.00 2.75% 2.00% 0.625% 3.00% 1.25%
-----------------------------------------------------------------------------------
II GREATER THAN
OR EQUAL TO 3.50 and 2.50% 1.75% 0.50% 2.75% 1.00%
LESS THAN 4.0
-----------------------------------------------------------------------------------
III GREATER THAN
OR EQUAL TO 2.50 and 2.25% 1.50% 0.375% 2.50% 0.75%
LESS THAN 3.50
-----------------------------------------------------------------------------------
IV GREATER THAN
OR EQUAL TO 2.00 and 2.0% 1.25% 0.25% 2.25% 0.50%
LESS THAN 2.50
-----------------------------------------------------------------------------------
V LESS THAN 2.0 1.75% 1.00% 0.25% 2.00% 0.25%
-----------------------------------------------------------------------------------
Notwithstanding the foregoing, for the first six months after the Effective
Date, the Applicable Margin shall be set as if Borrower's Funded Debt to EBITDA
ratio were at Level II, and thereafter adjustments to the Applicable Margin
shall be based on changes in the Funded Debt to EBITDA Ratio as set forth above
calculated quarterly, and shall be determined based on the computations set
forth in the Compliance Certificate ("Certificate") furnished to the Agent
pursuant to Section 8.01 and shall be effective commencing on the date following
the date such Certificate is received (or if earlier, the date such Certificate
was required to be delivered), and in each case, until the date following the
date on which a new Certificate is delivered or is required to be delivered,
whichever shall first occur, PROVIDED however, if the Borrower shall fail to
deliver any such Certificate within the time period required by Section 8.01,
2
then the Applicable Margin with respect to the Revolving Loans and the Term Loan
shall be at Level I until the appropriate Certificate is so delivered.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" has the meaning set forth in
Section 13.06.
"AUTHENTICATING PERSON" has the meaning set forth in Section 5.01(e).
"AUTHORIZED REPRESENTATIVE" means any of the Chief Executive Officer,
President or any Vice President of the Borrower or, with respect to financial
matters, the Chief Financial Officer, Treasurer or Controller of the Borrower,
or any other Person expressly designated by the Board of Directors of the
Borrower (or appropriate committee thereof) as an Authorized Representative of
the Borrower, as set forth from time to time in a certificate in the form of
Exhibit "A".
"AVAILABLE REVOLVING COMMITMENT" means, on any date of determination, the
lesser of (a) and (b), with (a) being equal to the Revolving Commitment in
effect on such date and (b) being equal to the then current Borrowing Base less
the aggregate principal balance of the Term Loans on such date.
"BASE RATE" means the lending rate as announced by the Agent from time to
time as its base rate, which may change as often as daily, provided, however,
that at no time shall the rate of interest exceed the highest rate allowed by
law.
In the event that the Agent does not, for any reason, announce a Base Rate
or discontinues the use of the term "Base Rate" as a benchmark for interest rate
on its loans, the Base Rate shall .be the rate quoted as the "Prime Rate" as
reported in the "Money Rates" section of the Wall Street Journal (or the
arithmetic average of the rates so quoted, if more than one rate is quoted) or
in the event of discontinuance of such publication or such section thereof, the
Base Rate shall mean the monthly average Prime Rate as reported and published in
the FEDERAL RESERVE BULLETIN published monthly by the Board of Governors of the
Federal Reserve System under the table styled "Prime Rate Charged by Banks on
Short Term Business Loans". In the event of the discontinuance of both such
publications or such section or table thereof, the Base Rate shall mean the
Prime Rate as from time to time announced or published by Citibank, N.A. at its
principal office in New York, New York.
The terms "Base Rate" and "Prime Rate" are intended by the parties to be
benchmarks only and are not to be construed as indicating that such rates are
the best or lowest rates offered by the Agent to any of its customers regardless
of their creditworthiness.
"BASE RATE LOAN" means a Loan that bears interest based upon the Adjusted
Base Rate.
"BENEFICIARY" means any third Person designated by the Borrower to whom the
Agent is to make payment or on whose order payment is to be made under a Letter
of Credit.
"BORROWER" shall have the meaning set forth in the introductory paragraph
hereof and shall include Borrower's successors and permitted assigns. In each
instance where the term Borrower is used herein it shall be deemed to refer to
each of the parties comprising Borrower individually as well as collectively.
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"BORROWING" means a borrowing of Revolving Loans pursuant to Section 2.01
hereof, the Borrowing of Term Loans on the Effective Date pursuant to Section
2.07 hereof, or a deemed Borrowing pursuant to Section 2.11 hereof.
"BORROWING BASE" means, at any date of determination, an amount equal to
the sum of (i) eighty percent (80%) of the Eligible Accounts, PLUS (ii) fifty
percent (50%) of Eligible Inventory, (iii) PLUS sixty percent (60%) of
Borrower's Fixed Assets.
"BORROWING BASE CERTIFICATE" means a certificate of the Borrower in
substantially the form of Exhibit "B" hereto and delivered to the Agent pursuant
to Section 8.03 hereof.
"BUSINESS DAY" means any day other than a Saturday, Sunday or other day on
which commercial banks in Birmingham, Alabama are authorized or required to
close by law, and, if the applicable Business Day relates to determination of
the Eurodollar Rate, a day on which commercial bank are open for domestic and
international business (including dealings in U.S. Dollar deposits) in London,
England.
"BUSINESS UNIT" means the assets constituting the business or a division or
operating unit of any Person.
"CAPITALIZED LEASE OBLIGATION" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with such principles.
"CASH COLLATERAL ACCOUNT" means a special non-interest bearing deposit
account maintained at the Principal Office of the Agent and under the sole
dominion and control of the Agent. The monies deposited into the Cash
Collateral Account pursuant to this Agreement shall be applied to the
Reimbursement Obligations.
"COLLATERAL" means the collateral described in the Pledge Agreement and any
property owned by Borrower or its Subsidiaries hereafter made subject to a
security interest to secure the obligations of the Borrower hereunder.
"COMMITMENT" means, as to each Lender, such Lender's obligation to make
Loans hereunder and to purchase participation interests in Letters of Credit to
the extent of such Lender's Credit Percentage.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any fiscal period of
Borrower, total interest expense (including without limitation, interest expense
attributable to capitalized leases) of Borrower and its Subsidiaries on a
consolidated basis but shall not include interest on the Tank Loan.
"CONSOLIDATED INTEREST EXPENSE COVERAGE RATIO" means , as of any date of
determination for the Borrower and its Subsidiaries on a consolidated basis, the
ratio of (a) EBITDA to (b) the Consolidated Interest Expense for such period, in
each case determined in accordance with GAAP.
"CONTINUATION" has the meaning given in Section 2.11 hereof.
"CONTROL" means that any one Person or group of related Persons acquire
more than fifty percent (50%) of the outstanding shares of voting stock of the
Borrower or any Subsidiary thereof.
4
"CONVERT", "CONVERSION" and "CONVERTED" each refers to a conversion of
Loans of one Type into Loans of another Type pursuant to Section 2.11(b) hereof.
"CREDIT EVENT" means any of the following: (a) the making (or deemed
making) or Continuation of any Loan; (b) the Conversion of a Borrowing of Loans
from one Type to another Type; and (c) the issuance of a Letter of Credit.
"CREDIT PERCENTAGE" means, as to each Lender, the percentage set forth on
Annex I.
"CURRENT SUBSIDIARIES" means Virgin Islands Rum Industries Ltd. and
Xxxxxxxxx Bahamas Limited which are Subsidiaries of Borrower.
"DATE OF ISSUANCE" means the date of issuance by a Letter of Credit Issuer
of a Letter of Credit under this Agreement.
"DEFAULT" means any of the events specified in Section 11.01, whether or
not there has been satisfied any requirement for giving of notice, lapse of time
or the happening of any other condition.
"DOLLARS" or "$" means the lawful currency of the United States of America.
"DRAWING" means a drawing by a Beneficiary under any Letter of Credit.
"EBITDA" means, for any period, the sum of (i) net income (or loss) of the
Borrower and its Subsidiaries on a consolidated basis for such period, plus (ii)
to the extent deducted in determining such net income (loss) (A) provisions for
income taxes for such period, (B) interest expense for such period, (C)
depreciation and amortization of intangible assets during such period, (D) less
extraordinary income and expense items realized in such period, and (E) less the
gains or losses on the sale or disposition of assets outside the ordinary course
of Borrower's business, in each case determined in accordance with GAAP. For
the purposes of this Agreement, EBITDA will be determined based on the most
recent four (4) fiscal quarters of Borrower. If the acquisition of Xxxxx Wine
Company d/b/a Monarch Wine Company of Georgia ("Monarch") is consummated in
Borrower's first fiscal quarter for 1999-00, then, for that quarter and each of
the three (3) fiscal quarters of Borrower following the Effective Date, the
calculation of EBITDA for each four (4) quarter period shall include the
historical proforma financial performances (computed in accordance with the
requirements of Regulation S-X of the SEC or other requirements reasonably
satisfactory to the Agent) of Monarch for that four (4) quarter period occurring
prior to the acquisition of Monarch, to the extent that the acquisition of
Monarch has not otherwise been reflected in Borrower's financial results.
"EFFECTIVE DATE" means the date on which all of the conditions set forth in
Section 5.01 hereof shall have been fulfilled or waived in writing by the
Lenders.
"ELIGIBLE ACCOUNT" shall mean an Account of the Borrower or any Subsidiary
arising from a sale made to a customer by the Borrower or any Subsidiary in the
ordinary course of business with respect to which the Borrower has furnished to
the Agent information as set forth in Section 8.03 or otherwise qualified under
subsection (h) below, provided that no Account of the Borrower or such
Subsidiary shall be deemed to be an Eligible Account if, as determined by Agent
in its sole and absolute discretion:
5
(a) such Account arises out of a sale made by the Borrower or such
Subsidiary to an Affiliate of the Borrower which is not an arms length
transaction on substantially the same terms as Borrower or the Subsidiary would
have concluded the sale with an unrelated third party; or
(b) such Account arises out of a sale having terms for final payment in
excess of ninety (90) days from the date of purchase; or
(c) such Account remains unpaid for more than 90 days after the due date
of the invoice for such Account; or
(d) twenty percent (20%) or more of the amount of the Accounts of the
Account Debtor and its Affiliates remain unpaid for more than 90 days after the
date of the invoice for such Account; or
(e) (i) the Account Debtor is also a creditor of the Borrower or such
Subsidiary, to the extent of the amount owed by the Borrower or such Subsidiary
to the Account Debtor (unless the Agent receives from such Account Debtor an
agreement or other writing satisfactory to the Agent pursuant to which such
Account Debtor agrees to waive any right of offset it may have with respect to
any amounts owing by the Borrower or such Subsidiary to such Account Debtor);
(ii) the Account Debtor has disputed its liability on, or the Account Debtor has
made any claim with respect to, such Account or any other Account due from such
Account Debtor to the Borrower or such Subsidiary which has not been resolved,
to the extent of the amount of such dispute or claim; or (iii) the Account
otherwise is contractually or by operation of law subject to any right of setoff
by the Account Debtor, to the extent of the amount of such setoff; or
(f) the Account Debtor has commenced a voluntary case under the federal
bankruptcy laws, as now constituted or hereafter amended, or made an assignment
for the benefit of creditors, or if a decree or order for relief has been
entered by a court having jurisdiction over the Account Debtor in an involuntary
case under the federal bankruptcy laws, as now constituted or hereafter amended
which has not been dismissed with forty-five (45) days after filing, or if any
other petition or other application for relief under the federal bankruptcy laws
has been filed by or against the Account Debtor, or if the Account Debtor has
failed, suspended business, declared itself to be insolvent, or consented to or
suffered a receiver, trustee, liquidator or custodian to be appointed for it or
for all or a significant portion of its assets or affairs; or
(g) Agent determines, in its discretion that collection of such Account is
insecure or that such Account may not be paid by reason of the Account Debtor's
financial inability to pay; or
(h) the Account Debtor is the United States of America or any department,
agency or instrumentality thereof and the aggregate principal amount owed is in
excess of Fifty Thousand and no/100s Dollars ($50,000.00), unless the Borrower
duly assigns its rights to payment of such Account to the Agent pursuant to the
Assignment of Claims Act of 1940, as amended (31 U.S.C. Section 3727 ET SEQ.),
or the Account Debtor is Canada or any department, agency or instrumentality
thereof, unless the Borrower or such Subsidiary duly assigns its rights to
payment of such Account to the Agent pursuant to any equivalent to the
Assignment of Claims Act of 1940, as amended (31 U.S.C. Section 3727 ET SEQ.) in
Canada, provided, however, that subsidies or promotional allowances received by
Borrower or a Subsidiary which have historically been received by Borrower or a
Subsidiary from the United States of America or the Government of the United
States Virgin Islands shall not be excluded from Eligible Accounts; or
6
(i) such Account is evidenced by an "instrument" or "chattel paper"
(within the meaning of the UCC) of any kind unless such instrument or chattel
paper is delivered to the Agent with all appropriate endorsements in favor of
the Agent thereon; or
(j) such Account does not represent a complete BONA FIDE transaction which
requires no further act under any circumstances on the part of the Borrower or
such Subsidiary to make such Account payable by the Account Debtor; or
(k) such Account is not a valid, legally enforceable obligation of the
Account Debtor with respect thereto or is subject to a present or contingent (or
there exist facts which are the basis for any future) offset, deduction,
counterclaim, dispute or other defense on the part of such Account Debtor; or
(l) the Inventory giving rise to such Account was at the time of sale
thereof subject to a Lien other than Permitted Liens; or
(m) such Account has otherwise been determined by the Agent in good faith
to be ineligible for any other reason.
"ELIGIBLE INVENTORY" means the Inventory Value of Inventory of the Borrower
or any Subsidiaries which the Agent, in its sole and absolute discretion,
determines meets all of the following requirements:
(a) such Inventory is (i) owned by and in the possession and under the
control of the Borrower or such Subsidiary or located in a bonded warehouse
convenient to the Borrower or such Subsidiary monitored by a third party not
affiliated with the Borrower or such Subsidiary and acceptable to the Agent in
its sole discretion, and (ii) as to which the Borrower has furnished to the
Agent the information required by Section 8.03;
(b) such Inventory has not been sold;
(c) such Inventory (i) is owned by the Borrower or such Subsidiary, and
(ii) is subject to no Lien whatsoever other than Permitted Liens;
(d) such Inventory is in good condition and meets all standards imposed by
any governmental agency, or department or division thereof, having regulatory
authority over such goods, their use or sale;
(e) such Inventory is currently either usable or salable in the normal
course of the business of the Borrower or such Subsidiary;
(f) such Inventory is located within the United States or one of its
territories; and
(g) such Inventory is not determined by the Agent in good faith to be
ineligible for any other reason.
"ENVIRONMENTAL LAWS" means any Applicable Law relating to environmental
protection including, without limitation, the following: Clean Air Act, 42
U.S.C. Section 7401 ET SEQ; Federal Water Pollution Control Act, 33 U.S.C.
Section 1251 ET SEQ.; Solid Waste Disposal Act, 42 U.S.C. Section 6901 ET SEQ.;
7
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Section 9601 ET SEQ.; National Environmental Policy Act, 42 U.S.C. Section 4321
ET SEQ.; regulations of the Environmental Protection Agency and any applicable
rule of common law and any judicial interpretation thereof relating primarily to
the environment or Hazardous Materials.
"ERISA" means the Employee Retirement Income Security Act of 1974, as in
effect from time to time, and any successor statute and all rules and
regulations promulgated thereunder.
"EURODOLLAR RATE" means the interest rate per annum calculated according to
the following formula:
Eurodollar = Interbank Offered Rate
Rate ---------------------------------------
1-Eurodollar Reserve Percentage
"EURODOLLAR RATE LOAN" means a Loan that bears interest based upon the
Adjusted Eurodollar Rate.
"EURODOLLAR RESERVE PERCENTAGE" means, for any day, that percentage
(expressed as a decimal) which is in effect from time to time under Regulation D
or any successor regulation, as the reserve requirement (including any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurocurrency liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate of Eurodollar Rate Loans is determined), whether or not the
Agent or any Lender has any Eurocurrency liabilities subject to such
requirements, without benefits of credits or proration, exceptions or offsets
that may be available from time to time to the Agent or any Lender. The
Eurodollar Rate shall be adjusted automatically on and as of the effective date
of any change in the Eurodollar Reserve Percentage.
"EVENT OF DEFAULT" means any of the events specified in Section 11.01,
provided that any requirement for notice or lapse of time or any other condition
has been satisfied.
"FACILITY TERMINATION DATE" has the meaning set forth in Section 3.07.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating interest rate per
annum (rounded upward to the nearest 1/100th of 1%) equal, for each day during
such period, to the weighted average of the rates on overnight Federal Funds
transactions with members of the Federal Reserve System arranged by Federal
Funds brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New York, or
if such rate is not so published for any day that is a Business Day, the average
of the quotations for such day on such transactions received by the Agent from
three Federal Funds brokers of recognized standing selected by it.
"FEES" means the fees and commissions provided for or referred to in
Sections 3.03 and 4.08 and any other fees payable by the Borrower hereunder or
under any other Loan Document.
"FIXED ASSETS" means the gross fixed assets of Borrower without deduction
for depreciation or amortization.
8
"FIXED CHARGES" means the scheduled principal and interest payments on
Funded Debt due in the period in question.
"FIXED CHARGE COVERAGE RATIO" means the ratio of EBITDA to Fixed Charges
which shall be measured on the basis of the preceding four (4) fiscal quarters
of Borrower.
"FUNDING AGENT" means SouthTrust Bank, National Association, as Agent for
the Lenders under the terms of this Agreement, and any successor Agent.
"FUNDED DEBT" means without duplication, the principal balance of all
indebtedness, other than the Tank Loan, for money borrowed, purchase money
mortgages, capitalized leases, conditional sales contracts and similar title
retention debt instruments under which Borrower or any of its Subsidiaries is
an obligor, including any current maturities of such indebtedness, plus all debt
of other entities or Persons, other than Subsidiaries, which has been guaranteed
by the Borrower or any Subsidiary (other than the current balance of the
indebtedness of Premier Wines & Spirts, Ltd. as of the Effective Date guaranteed
by Borrower), or which is supported by a letter of credit issued for the account
of the Borrower or any Subsidiary which by its terms matures more than one year
from the date of any calculation thereof and/or which is renewable or extendible
at the option of the obligor to a date beyond one year from such date.
"GAAP" or "GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means generally
accepted accounting principles, being those principles of accounting set forth
in pronouncements of the Financial Accounting Standards Board, the American
Institute of Certified Public Accountants or which have other substantial
authoritative support and are applicable in the circumstances as of the date of
a report.
"GOVERNMENTAL APPROVALS" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"GOVERNMENTAL AUTHORITY" means any national, state or local government
(whether domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public or statutory instrumentality,
authority, body, agency, bureau or entity (including, without limitation, the
FDIC, the Comptroller of the Currency or the Federal Reserve Board, any central
bank or any comparable authority) or any arbitrator with authority to bind a
party at law.
"GUARANTY", "GUARANTEED" or to "GUARANTEE" as applied to any obligation
means and includes:
(a) a guaranty (other than by endorsement of negotiable instruments or
items for collection in the ordinary course of business or delivery to the Agent
on account of the Obligations), directly or indirectly, in any manner, of any
part or all of such obligation; or
(b) an agreement, direct or indirect, contingent or otherwise, and whether
or not constituting a guaranty, the practical effect of which is to assure the
payment or performance (or payment of damages in the event of nonperformance) of
any part or all of such obligation whether by:
(i) the purchase of securities or obligations,
(ii) the purchase, sale or lease (as lessee or lessor) of property or
the purchase or sale of services primarily for the purpose of enabling the
obligor with respect to such obligation to make any
9
payment or performance (or payment of damages in the event of nonperformance) of
or on account of any part or all of such obligation, or to assure the owner of
such obligation against loss,
(iii) the supplying of funds to or in any other manner investing in
the obligor with respect to such obligation,
(iv) repayment of amounts drawn down by beneficiaries of letters of
credit, or
(v) the supplying of funds to or investing in a Person on account of
all or any part of such Person's obligation under a Guaranty of any obligation
or indemnifying or holding harmless, in any way, such Person against any part or
all of such obligation.
"HAZARDOUS MATERIALS" means all hazardous or toxic materials as defined by
any Applicable Law and includes, without limitation, (a) hazardous waste as
defined in the Resource Conservation and Recovery Act of 1976, or in any other
applicable Environmental Laws, (b) hazardous substances, as defined in the
Comprehensive Environmental Response, Compensation and Liability Act, or in any
other applicable Environmental Laws, (c) gasoline, or any other petroleum
product or by-product, (d) toxic substances, as defined in the Toxic Substances
Control Act of 1976, or in any other applicable Environmental Laws, (e)
insecticides, fungicides, or rodenticides, as defined in the Federal
Insecticide, Fungicide, and Rodenticide Act of 1975, or in any other applicable
Environmental Laws, or (f) any hazardous waste, hazardous substances, hazardous
materials, toxic substances or toxic pollutants, as those terms are used or
defined in the Hazardous Materials Transportation Act, the Clean Air Act or the
Clean Water Act, as each such Act, statute or regulation may be amended from
time to time.
"INDEBTEDNESS" as applied to a Person means, without duplication, (a) all
items which in accordance with GAAP would be included in determining total
liabilities as shown on the liability side of a balance sheet of such Person as
at the date as of which Indebtedness is to be determined including, without
limitation, all Capitalized Lease Obligations of such Person and all
reimbursement obligations due or that may become due of such Person under
letters of credit and acceptances issued for its account, and (b) all
obligations of other Persons which such Person has Guaranteed.
"INTERBANK OFFERED RATE" means, for any Eurodollar Rate Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100th of 1%) appearing on Telerate Page 3750 (or any successor
page) as the London Interbank Offered Rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two (2) Business Days prior to the first
day of such Interest Period for a term comparable to such Interest Period. If,
for any reason, such rate is not available, the term "Interbank Offered Rate"
shall mean, with respect to any Eurodollar Rate Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100th of 1%) appearing on Reuters Screen LIBOR Page as the London interbank
offered rate of deposits in Dollars at approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBOR Page, the applicable rate shall be the
arithmetic means of all such rates.
"INTEREST PERIOD" means for any Base Rate Loan one (1) day and for any
Eurodollar Loan, the period commencing on the date of the Borrowing, Conversion
or Continuation of such Eurodollar Loan and ending on the last day of the period
pursuant to the provisions below. The duration of each Interest Period for
Eurodollar Rate Loans shall be one (1), two (2) or three (3) months, as
designated by
10
Borrower. Borrower shall, in an appropriate Notice of Borrowing, Notice of
Continuation or Notice of Conversion, designate the beginning of each such
Interest Period. In no event shall an Interest Period on a Revolving Loan
extend beyond the Revolving Termination Date. Whenever the last day of any
Interest Period would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on the next
succeeding Business Day; PROVIDED, HOWEVER, that if such extension would cause
the last day of such Interest Period to occur in the next following calendar
month, the last day of such Interest Period shall occur on the next preceding
Business Day.
Any Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month.
There shall not be more than eight (8) Interest Periods in effect for the
Revolving Loans and one (1) Interest Period in effect for the Terms Loans on any
day.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended.
"INVENTORY" means (a) all inventory of the Borrower or any Subsidiaries and
all goods intended for sale or lease by the Borrower or any Subsidiaries, or for
display or demonstration; (b) all work-in-process; (c) all raw materials and
other materials and supplies of every nature and description used or which might
be used in connection with the manufacture, packing, shipping, advertising,
selling, leasing or furnishing of such goods or otherwise used or consumed in
the Borrower's or such Subsidiary's business; and (d) all warehouse receipts and
other documents relating to any of the foregoing.
"INVENTORY VALUE" means the lesser of (i) the contract amount for the sale
of any Inventory or (ii) the market value of such Inventory.
"L/C COMMITMENT AMOUNT" equals $2,000,000, as the same may be reduced
permanently from time to time pursuant to Section 3.08 hereof.
"L/C TERMINATION DATE" means the Revolving Termination Date or the Facility
Termination Date, whichever occurs first.
"LENDER" shall have the meaning set forth in the introductory paragraph
hereof and shall include each Lender's successors and permitted assigns.
"LENDING OFFICE" means, for each Lender, the "Lending Office" specified for
such Lender on the signature pages attached hereto.
"LETTER OF CREDIT" has the meaning set forth in Section 3.01(a).
"LETTER OF CREDIT FACILITY" means the credit facility described in
Article III pursuant to which the Letters of Credit are to be issued.
"LETTER OF CREDIT ISSUER" means the Agent or, with the written consent of
the Agent and the Borrower, any other Lender that issues Letters of Credit for
the account of the Borrower pursuant to Section 3.01.
11
"LIEN" as applied to the property of any Person means: (a) any mortgage,
deed to secure debt, deed of trust, lien, pledge, charge, lease constituting a
Capitalized Lease Obligation, conditional sale or other title retention
agreement, or other security interest, security title or encumbrance of any kind
in respect of any property of such Person, or upon the income or profits
therefrom; (b) any arrangement, express or implied, under which any property of
such Person is transferred, sequestered or otherwise identified for the purpose
of subjecting the same to the payment of Indebtedness or performance of any
other obligation in priority to the payment of the general, unsecured creditors
of such Person; and (c) the filing of, or any agreement to give, any financing
statement under the UCC or its equivalent in any jurisdiction.
"LOAN" or "LOANS" means any Revolving Loan or Term Loan or collectively all
of the Revolving Loans and Term Loans.
"LOAN COMMITMENT" means the aggregate commitments of $71,000,000 from the
Lenders for Term Loans, Revolving Loans and Letters of Credit.
"LOAN DOCUMENT" means this Agreement, each of the Notes, the Pledge
Agreement and each other document or instrument executed and delivered by a
party comprising Borrower in connection with this Agreement, the Revolving
Credit Facility, the Term Loan Facility, the Letter of Credit Facility or any of
the foregoing agreements.
"MATERIAL ADVERSE EFFECT" means, with respect to any Person, a material
adverse effect upon such Person's business, assets, liabilities, financial
condition, results of operations or business prospects, as determined by the
Required Lenders in their sole discretion exercised in good faith.
"MONARCH ACQUISITION AGREEMENT" means, collectively, (a) the Asset Purchase
Agreement dated as of September 27, 1999, by and among Monarch as the Seller,
the shareholders of the Seller signatory thereto, and Borrower, as the
Purchaser, pursuant to which said Seller has agreed to sell and the Borrower has
agreed to purchase from the Seller substantially all of the assets comprising
the business known as "Monarch Wine Company" under various trade names described
therein for a purchase price equal to $22,496,000 as adjusted pursuant to the
Agreement.
"MONEY BORROWED" means, as applied to the Indebtedness of a Person,
(a) Indebtedness for money borrowed, or
(b) Indebtedness, whether or not in any such case the same was for money
borrowed, but other than trade debt of such Person incurred in the ordinary
course of business:
(i) represented by notes payable, and drafts accepted, that
represent extensions of credit,
(ii) constituting obligations evidenced by bonds, debentures, notes
or similar instruments, or
(iii) upon which interest charges are customarily paid or that was
issued or assumed as full or partial payment for property, or
12
(c) Indebtedness that constitutes a Capitalized Lease Obligation, or
(d) Guaranty of Indebtedness that is such by virtue of clause (b) of the
definition of Indebtedness, but only to the extent that the obligations
Guaranteed are obligations that would constitute Indebtedness for Money
Borrowed.
"MULTIEMPLOYER PLAN" has the meaning set forth in Section 4001(a)(3) of
ERISA, as amended or revised from time to time.
"NOTE" means a Revolving Note or a Term Note, and "NOTES" means each and
every Note.
"NOTICE OF BORROWING" means a notice in the form of Exhibit "C" hereto to
be delivered to the Agent pursuant to Section 2.02 and 2.07 indicating the
intention of the Borrower to borrow Revolving Loans and the Term Loan.
"NOTICE OF CONTINUATION/CONVERSION" means a notice in the form of Exhibits
"D" and "E", respectively, hereto to be delivered to the Agent pursuant to
Section 2.02 in connection with the election of a subsequent Interest Period for
any Eurodollar Rate Loan, the continuation or conversion of a Eurodollar Rate
Loan into a Base Rate Loan or the continuation or conversion of any Base Rate
Loan into a Eurodollar Rate Loan.
"OBLIGATIONS" means, individually and collectively: (a) the Revolving
Loans; (b) the Term Loans, (c) all Reimbursement Obligations; and (d) all other
indebtedness, liabilities, obligations, covenants and duties of the Borrower and
any Subsidiary owing to the Agent or Lenders of every kind, nature and
description, under or in respect of this Agreement, any Note or any of the other
Loan Documents including, without limitation, any renewals or extensions
thereof, the Fees, and whether direct or indirect, absolute or contingent, due
or not due, contractual or tortious, liquidated or unliquidated, and whether or
not evidenced by any note.
"PAYMENT DATE" shall have the meaning set forth in Section 3.04(a).
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
agency.
"PERMITTED INVESTMENTS" means (i) prime commercial paper of a domestic
issuer rated at least "A-1" or "P-1", (ii) certificates of deposit with
maturities of one year or less from the date of acquisition issued by any
commercial bank organized under the laws of the United States or Canada having
capital resources in excess of $500,000,000 and a short-term debt rating of
"A-1" or "P-1" and a long term debt rating of "A" or higher and denominated in
U.S. Dollars, (iii) direct obligations of the United States government or any
agency thereof, and obligations guaranteed by the United States government, with
maturities or one year or less from the date of acquisition, or (iv) money
market deposit accounts with a commercial bank organized under the laws of the
United States or Canada having capital resources in excess of $500,000,000 and a
short term debt rating of "A-1" or "P-1" and a long term debt rating of "A" or
higher and denominated in U.S. Dollars.
"PERMITTED LIENS" means, as to any Person:
(a) inchoate Liens securing taxes, assessments and other governmental
charges or levies (excluding any Lien imposed pursuant to any of the provisions
of ERISA) or the claims of materialmen,
13
mechanics, carriers, warehousemen or landlords for labor, materials, supplies
or rentals incurred in the ordinary course of business payment of which is not
yet due;
(b) Liens consisting of deposits or pledges made, in the ordinary course
of business, in connection with, or to secure payment of, obligations under
workmen's compensation, unemployment insurance or similar legislation;
(c) Liens consisting of encumbrances in the nature of zoning restrictions,
easements, and rights or restrictions of record on the use of real property,
which do not materially detract from the value of such property or materially
impair the use thereof in the business of such Person;
(d) Liens in existence as of the date hereof and specified on
Schedule 6.01(g);
(e) Liens in favor of the Agent on behalf of the Lenders;
(f) Liens which have been approved by the Required Lenders;
(g) Liens upon property leased under a capital lease and placed upon such
property to secure the lease payments under such capital lease, provided, (i)
any such Lien shall not encumber any other property of the Borrower or such
Subsidiary, (ii) any such lien shall not exceed the total of such lease
payments, and (iii) the Agent has approved such capital lease transaction;
(h) Purchase money liens on capital assets acquired after the date hereof
securing the purchase price, or a portion thereof, of such capital asset,
provided (i) any such Liens shall not encumber any other property of the
Borrower or any Subsidiary, (ii) any such Lien shall not exceed the purchase
price of such capital asset, and (iii) the aggregate amount of the debt secured
by such liens does not exceed $250,000.00; and
(i) The lien on the Tank Project securing the Tank Loan.
"PERSON" means an individual, corporation, partnership, limited liability
corporation or partnership, association, trust or unincorporated organization,
or a government or any agency or political subdivision thereof.
"PLAN" means an employee benefit plan maintained for employees of the
Borrower or any of its Subsidiaries that is covered by Title IV of ERISA,
including such plans as may be established after the Agreement Date.
"PLEDGE AGREEMENT" means the pledge in the form attached hereto as Exhibit
"F" pursuant to which the stock in the Current Subsidiaries is pledged to the
Agent for the benefit of the Lenders to secure the Loans.
"POST-DEFAULT RATE" means a rate equal to two percent (2%) per annum above
the Base Rate as in effect from time to time.
"PRINCIPAL OFFICE" means with respect to the Agent, the office of the Agent
located at 000 Xxxxx 00xx Xxxxxx, Xxxxxxxxxx, XX 00000, Attn: Florida Corporate
Banking (West Palm Beach).
14
"QUARTERLY PAYMENT DATE" means the last Business Day of each March, June,
September and December to and including the Term Loan Maturity Date, commencing
March 31, 2000.
"REIMBURSEMENT OBLIGATION" means the absolute and unconditional obligation
of the Borrower to reimburse the Letter of Credit Issuer for any Drawing
pursuant to Section 3.04(b).
"REPORTABLE EVENT" has the meaning set forth in Section 4043(b) of ERISA,
but shall not include a Reportable Event as to which the provision for 30 days'
notice to the PBGC is waived under applicable regulations.
"REQUIRED LENDERS" means Lenders holding 75% of the Commitments provided
that, if the Commitments shall have been terminated for any reason, "Required
Lenders" shall mean Lenders holding 75% of the outstanding principal amount of
the Loans and participation interests in Letters of Credit.
"RESTRICTED DISTRIBUTION" means any payment, dividend or other distribution
of income, cash or other assets of the Borrower by the Borrower to any of the
Borrower's shareholders, partners or other Persons holding an equity interest in
the Borrower.
"RESTRICTED PURCHASE" means any payment by the Borrower to any of the
Borrower's shareholders, partners or other Persons holding an equity interest in
the Borrower on account of the purchase, redemption or other acquisition or
retirement of such equity interest in the Borrower.
"REVOLVING COMMITMENT" means $15,000,000, as the same may be reduced
permanently from time to time pursuant to Section 2.12 hereof.
"REVOLVING CREDIT FACILITY" means the revolving credit facility described
in Section 2.01 hereof.
"REVOLVING LOAN" has the meaning set forth in Section 2.01 hereof.
"REVOLVING NOTE" has the meaning set forth in Section 2.06 hereof.
"REVOLVING TERMINATION DATE" means the date that is three (3) years after
the date of this Agreement, provided that if such date is not a Business Day,
"Revolving Termination Date" shall mean the immediately preceding Business Day.
"SEC" means the Securities & Exchange Commission of the United States of
America.
"SECURED OBLIGATIONS" means, individually and collectively: (a) the
Revolving Loans; (b) the Term Loans, (c) all Reimbursement Obligations; and (d)
all other indebtedness, liabilities, obligations, covenants and duties of the
Borrower owing to the Agent or Lenders of every kind, nature and description,
under or in respect of this Agreement, any Note or any of the other Loan
Documents including, without limitation, any renewals or extensions thereof, the
Fees, and whether direct or indirect, absolute or contingent, due or not due,
contractual or tortious, liquidated or unliquidated, and whether or not
evidenced by any note.
"SECURITY INTEREST" means the Lien of the Agent for the benefit of the
Lenders upon, and the collateral assignment to the Agent for the benefit of the
Lenders of, the Collateral pursuant to the Pledge Agreement and any other Loan
Document.
15
"SENIOR MANAGEMENT" includes, but is not limited to, Messrs. Pincourt,
Maltby, Xxxxxx, Xxxxxxxx and Xxxxxxx.
"SENIOR NOTES" means the existing notes in the original principal amount of
$34,000,000 granted pursuant to the Note Purchase Agreement dated October 30,
1994, as further amended on February 1, 1996, by and between Borrower, Principal
Mutual Life Insurance Company, Connecticut Mutual Life Insurance Company n/k/a
Massachusetts Mutual Life Insurance Company and TMG Life Insurance Company by
The Mutual Group (U.S.), Inc., as Agent.
"STATED AMOUNT" means the amount available to be drawn by a Beneficiary
under a Letter of Credit from time to time, as the Stated Amount of any such
Letter of Credit may be increased or reduced from time to time in accordance
with the terms of such Letter of Credit.
"SUBSIDIARY" means any corporation or other entity in which more than 50%
of its outstanding voting stock or more than 50% of all equity interests are
owned directly or indirectly by the Borrower and/or by one or more of the
Borrower's Subsidiaries.
"TANGIBLE NET WORTH" means, with respect to any date of determination and
any Person, the consolidated shareholders' equity of such Person less (i) all
goodwill, non-compete agreements, and other assets which are classified as
intangible assets in accordance with GAAP except the trademarks listed on
Schedule 6.01(q), and (ii) all Indebtedness owing to such Person by any of its
Affiliates other than Indebtedness owing to Borrower on the date hereof from
Premier Wines & Spirits, Ltd. and Antillean Liquors, N.V. disclosed on Schedule
6.01(g), the aggregate principal balance of which does not exceed $2,000,000.
"TANK PROJECT" means the new molasses storage tank to be constructed at the
St. Croix facility owned by Virgin Islands Rum Industries, Ltd.
"TANK LOAN" means the loan from Westway Trading Corporation which is to be
used to finance the construction of the Tank Project.
"TERM LOAN COMMITMENT" means $56,000,000.
"TERM LOAN FACILITY" means the Term Loan facility described in Section 2.07
hereof.
"TERM LOAN" means a loan made to the Borrower pursuant to Section 2.07
hereof.
"TERM LOAN MATURITY DATE" means December 31, 2004, provided that if such
date is not a Business Day, "TERM LOAN MATURITY DATE" shall mean the immediately
preceding Business Day.
"TERM NOTE" has the meaning set forth in Section 2.08 hereof.
"TERMINATION EVENT" means (a) a Reportable Event; (b) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA or (c) the institution of proceedings to
terminate a Plan by the PBGC under Section 4042 of ERISA, or the appointment of
a trustee to administer any Plan.
16
"TYPE" with respect to any Loan, refers to whether such Loan is a
Eurodollar Rate Loan or a Base Rate Loan.
"UNFUNDED VESTED ACCRUED BENEFITS" means with respect to any Plan at any
time, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Plan EXCEEDS (b) the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan.
"UNIFORM COMMERCIAL CODE" or "UCC" means the Uniform Commercial Code as in
effect from time to time in the State of Florida.
SECTION 1.02. GENERAL. All terms of an accounting nature not specifically
defined herein shall have the meaning ascribed thereto by GAAP. References in
this Agreement to "Sections", "Articles", "Exhibits" and "Schedules" are to
sections, articles, exhibits and schedules herein and hereto unless otherwise
indicated. References in this Agreement to any document, instrument or
agreement (a) shall include all exhibits, schedules and other attachments
thereto, (b) shall include all documents, instruments or agreements issued or
executed in replacement thereof, and (c) shall mean such document, instrument or
agreement, or replacement or predecessor thereto, as amended, modified or
supplemented from time to time in accordance with its terms and in effect at any
given time. Wherever from the context it appears appropriate, each term stated
in either the singular or plural shall include the singular and plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter. Unless explicitly set forth to the
contrary, a reference to "Subsidiary" shall mean a Subsidiary of the Borrower or
a Subsidiary of such Subsidiary. Unless otherwise indicated, all references to
time are references to prevailing Eastern time. Unless otherwise indicated, all
accounting terms, ratios and measurements shall be interpreted or determined in
accordance with generally accepted accounting principles. References in this
Agreement to "including" shall mean "including without limiting the generality
of any description preceding such term."
ARTICLE II
REVOLVING CREDIT FACILITY
SECTION 2.01. REVOLVING CREDIT FACILITY. Subject to the terms and
conditions hereof, during the period from the Effective Date to the Revolving
Termination Date, each Lender severally agrees to make revolving loans (the
"REVOLVING LOANS") to the Borrower in an aggregate principal amount at any time
outstanding up to, but not exceeding the product of (a) and (b), with (a) being
equal to (i) the Available Revolving Commitment at such time LESS (ii) the
aggregate Stated Amounts of Letters of Credit outstanding at such time, and (b)
being equal to such Lender's Credit Percentage; PROVIDED, however, that the
Lenders will not be required and shall have no obligation to make any such loan
(i) so long as a Default or an Event of Default has occurred and is continuing,
or (ii) if the Agent has accelerated the maturity of any of the Notes as a
result of an Event of Default. Subject to the terms and conditions of this
Agreement, during the period from the Effective Date until but not including the
Revolving Termination Date, the Borrower may borrow, repay and reborrow
Revolving Loans; PROVIDED, however, that (y) no Revolving Loan that is an
Eurodollar Rate Loan shall be made which has an Interest Period that extends
beyond the Revolving Termination Date, and (z) each Revolving Loan that is an
Eurodollar Rate Loan may, subject to the provisions of Section 2.12, be repaid
only on the last day of the Interest Period with respect thereto unless such
payment is accompanied by the additional payment, if any, required by Section
2.12. All Borrowings of Revolving Loans which are Eurodollar Rate Loans shall
be
17
in an aggregate minimum amount of $1,000,000 and integral multiples of
$100,000 thereof in excess of that amount and if such Loans are Base Rate
Loans, shall be in the aggregate minimum amount of $250,000 and integral
multiples of $100,000 thereof in excess of that amount. At no one time will
there be outstanding more than eight (8) Eurodollar Rate Loans.
SECTION 2.02. BORROWINGS UNDER REVOLVING CREDIT FACILITY. An Authorized
Representative shall give the Agent (1) at least three (3) Business Days'
irrevocable written notice by telefacsimile transmission of a Notice of
Borrowing with appropriate insertions, effective upon receipt, of each Revolving
Loan that is an Eurodollar Rate Loan (whether representing an additional
borrowing hereunder or the conversion of a borrowing hereunder from Base Rate
Loans to Eurodollar Rate Loans) prior to 11:00 a.m. Eastern Standard Time
("EST"), and (2) irrevocable written notice by telefacsimile transmission of a
Notice of Borrowing with appropriate insertions, effective upon receipt, of each
Revolving Loan that is a Base Rate Loan (whether representing an additional
borrowing hereunder or the conversion of borrowing hereunder from Eurodollar
Rate Loans to Base Rate Loans) prior to 11:00 a.m. EST on the day of such
proposed Revolving Loan which shall be a Business Day. Each such notice shall
specify the amount of the borrowing, the Type of Revolving Loan, and the date of
the borrowing. Notice of receipt of such Borrowing Notice together with the
amount of each Lender's portion of the Loan requested thereunder, shall be
provided by the Agent to each Lender by telefacsimile transmission with
reasonable promptness, but (provided the Agent shall have received such notice
by 11:00 a.m. EST) not later than 2:00 p.m. EST on the same date as the Agent's
receipt of such notice.
SECTION 2.03. DISBURSEMENTS UNDER REVOLVING CREDIT FACILITY.
(a) No later than 3:00 p.m. EST on the date specified in a Notice of
Borrowing on which Revolving Loans are to be borrowed, each Lender will make
available for the account of its applicable Lending Office to the Agent at the
address of the Agent set forth on the signature pages hereof, the Revolving Loan
to be made by it, by wire transfer of immediately available funds pursuant to
wiring instructions set forth on Annex I attached hereto or as otherwise
directed by the Agent in writing. Unless the Agent shall have been notified in
writing by any Lender prior to the requested date of any Borrowing that such
Lender does not intend to make available to the Agent its portion of the
Borrowing requested to be made on such date, the Agent may assume that such
Lender will make such amount available to the Agent on the date of the requested
Borrowing as set forth in the Notice of Borrowing and the Agent may, in reliance
upon such assumption, make available to the Borrower the amount of the Borrowing
to be provided by such Lender.
(b) Provided that the applicable conditions set forth in Article V hereof
for such Borrowing are fulfilled, all funds received by the Agent from the
Lenders pursuant to Section 2.03(a) will be made available to the Borrower by
credit to the account of the Borrower maintained with the Agent and specified in
the Notice of Borrowing.
(c) If the amount described in Section 2.03(a) is not in fact made
available to the Agent by a Lender (such Lender being herein referred to as a
"DEFAULTING LENDER") and the Agent has nevertheless made available to the
Borrower the amount of the Borrowing to be provided by such Lender, the Agent
shall be entitled to recover such corresponding amount on demand from such
Defaulting Lender. If such Defaulting Lender does not pay such corresponding
amount forthwith upon the Agent's demand therefor, the Agent shall promptly
notify the Borrower, and the Borrower shall immediately pay such corresponding
amount to the Agent. The Agent shall also be entitled to recover from such
Defaulting Lender interest on such corresponding amount in respect of each day
from the date such amount was
18
made available to the Borrower to the date such corresponding amount is
recovered by the Agent, at a rate per annum equal to the overnight Federal
Funds Rate. Nothing herein shall be deemed to relieve any Lender of its
obligation to fulfill its commitments hereunder or to prejudice any rights
which the Borrower may have against any Lender as a result of any default by
such Lender hereunder.
SECTION 2.04. SEVERAL OBLIGATIONS. No Lender shall be responsible for the
failure of any other Lender to make a Revolving Loan to be made by such other
Lender pursuant to a Notice of Borrowing; PROVIDED, HOWEVER, that the failure of
any Lender to make a Revolving Loan to be made by it under a Notice of Borrowing
shall not relieve the obligation of each other Lender to make the Revolving Loan
to be made by such other Lender under such Notice of Borrowing.
SECTION 2.05. REPAYMENT OF REVOLVING LOANS.
(a) Pursuant to the terms of the Revolving Notes, the Borrower shall repay
the entire outstanding principal amount of, and all accrued interest on, the
Revolving Loans on the Revolving Termination Date.
(b) If at any time the aggregate principal amount of the Revolving Loans
PLUS the aggregate Stated Amounts of all Letters of Credit outstanding at such
time exceeds the Available Revolving Commitment in effect at such time, the
Borrower shall immediately pay to the Agent for the respective accounts of the
Lenders the amount of such excess. Such payment shall be applied to pay all
amounts of principal outstanding on the Revolving Loans PRO RATA in accordance
with the first sentence of Section 4.05 hereof and the remainder, if any, shall
be deposited by the Agent into the Cash Collateral Account for application to
any Reimbursement Obligation that may become due with respect to any Letters of
Credit then outstanding. In the event the Borrower is required to pay any
outstanding Eurodollar Rate Loans by reason of this Section 2.05(b) prior to the
end of the applicable Interest Period therefor, the Borrower shall indemnify
each Lender against the losses, costs and expenses described in Section 2.12
hereof incurred by such Lender.
SECTION 2.06. REVOLVING NOTES. The obligation of the Borrower to repay
the Revolving Loans shall be evidenced by promissory notes (each a "REVOLVING
NOTE" and collectively, the "REVOLVING NOTES"). Each Revolving Note delivered
to each Lender shall be payable to such Lender, shall be in the face amount
equal to the product of: (a) such Lender's Credit Percentage TIMES (b) the
Revolving Commitment, and shall be in substantially the form of Exhibit "G"
hereto. Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower resulting from
each Revolving Loan made by such Lender from time to time and the amounts of
principal and interest payable and paid from time to time in respect of each
such Revolving Loan. In any legal action or proceeding in respect of this
Agreement, the entries made in such account or accounts shall be presumptive
evidence of the existence and amounts of the obligations of the Borrower therein
recorded absent manifest error.
SECTION 2.07. TERM LOAN FACILITY. Subject to the terms and conditions
hereof, each Lender severally agrees to make a Term Loan to the Borrower on the
Effective Date in a principal amount equal to its Credit Percentage of the Term
Loan Commitment. An Authorized Representative shall give the Agent (1) at least
three (3) Business Days' irrevocable written notice by telefacsimile
transmission of a Notice of Borrowing with appropriate
19
insertions, effective upon receipt, if a Eurodollar Rate Loan (including
conversion from a Base Rate Loan to a Eurodollar Rate Loan) prior to 11:00
a.m. EST, and (2) irrevocable written notice by telefacsimile transmission of
a Notice of Borrowing with appropriate insertions, effective upon receipt, if
a Base Rate Loan (including conversion from a Eurodollar Rate Loan to a Base
Rate Loan) prior to 11:00 a.m. EST on the Effective Date. Notice of receipt
of such Borrowing Notice together with the amount of each Lender's portion of
the Loan requested thereunder shall be provided by the Agent to each Lender
by telefacsimile transmission with reasonable promptness, but (provided the
Agent shall have received such notice by 11:00 a.m. EST) not later than 1:00
p.m. EST on the same date as the Agent's receipt of such notice. No later
than 2:00 p.m. EST on the Effective Date each Lender will make available for
the account of its applicable Lending Office to the Agent, at the address of
the Agent set forth on the signature pages hereof, the Term Loan to be made
by it by wire transfer of immediately available funds pursuant to the wiring
instructions set forth on Annex I attached hereto or as otherwise directed by
the Agent in writing. No later than 5:00 p.m. EST on the Effective Date the
Agent shall make available to or for the account of the Borrower, and in
accordance with the written instructions of the Borrower, the proceeds of the
Term Loans made available to the Agent by the Lenders. No Lender shall be
responsible for the failure of any other Lender to make the Term Loan to be
made by such other Lender pursuant to this Section 2.07; PROVIDED, HOWEVER,
that the failure of any Lender to make the Term Loan to be made by it under
this Section 2.07 shall not relieve the obligation of each other Lender to
make the Term Loan to be made by such other Lender under this Section 2.07.
SECTION 2.08. TERM NOTES. The obligation of the Borrower to repay the
Term Loans shall be evidenced by promissory notes (each a "TERM NOTE" and,
collectively, the "TERM NOTES"). Each Term Note delivered to a Lender shall be
payable to such Lender, shall be in the face amount equal to the principal
amount of such Lender's Term Loan made on the Effective Date, and shall be
substantially in the form of Exhibit "H" hereto. Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower resulting from the Term Loan made by such Lender
and the amounts of principal and interest payable and paid from time to time in
respect of such Term Loan. In any legal action or proceeding in respect of this
Agreement, the entries made in such account or accounts shall be presumptive
evidence of the existence and amounts of the obligations of the Borrower therein
recorded absent manifest error.
SECTION 2.09. TERM LOAN AMORTIZATION AND MATURITY. On each Quarterly
Payment Date commencing with the Quarterly Payment Date occurring on March 31,
2000 and on the Term Loan Maturity Date, the Borrower shall, pursuant to the
terms of the Term Notes, make a scheduled payment of the outstanding principal
amount of the Term Loan in an aggregate amount equal to the lesser of (i) the
then outstanding principal balance of all Term Notes and (ii) the amount set
forth below opposite such Quarterly Payment Date or Term Loan Maturity Date, as
the case may be:
Term Loan Maturity Date
Quarterly Payment Date Occurring Aggregate Principal
in: Payment
--- -------
March 31, 2000 $2,000,000
June 30, 2000 $2,000,000
September 30, 2000 $2,000,000
December 31, 2000 $2,000,000
March 31, 2001 $2,000,000
June 30, 2001 $2,000,000
September 30, 2001 $2,000,000
December 31, 2001 $2,000,000
March 31, 2002 $2,000,000
20
June 30, 2002 $2,000,000
September 30, 2002 $2,000,000
December 31, 2002 $2,000,000
March 31, 2003 $2,000,000
June 30, 2003 $2,000,000
September 30, 2003 $2,000,000
December 31, 2003 $2,000,000
March 31, 2004 $2,000,000
June 30, 2004 $2,000,000
September 30, 2004 Remaining unpaid principal
December 31, 2004 balance
SECTION 2.10. INTEREST ON LOANS.
(a) INTEREST ON EURODOLLAR RATE LOANS. Subject to the provisions of
Section 4.01 hereof, (i) in the case of each Revolving Loan or portion thereof
that is a Eurodollar Rate Loan, interest shall be payable on the day after the
expiration of each Interest Period commencing with the end of the first such
Interest Period (and after maturity of such Loan (whether by acceleration or
otherwise) upon demand) at an interest rate per annum equal to the Adjusted
Eurodollar Rate for the Interest Period in effect for such Eurodollar Rate Loan,
and (ii) in the case of the Term Loan if a Eurodollar Rate Loan, interest shall
be payable at the expiration of each Interest Period commencing with the end of
the first such Interest Period (and after maturity of such Loan (whether by
acceleration or otherwise) upon demand) at an interest rate per annum equal to
the Adjusted Eurodollar Rate for the Interest Period in effect for such
Eurodollar Rate Loan. The Agent upon determining the Adjusted Eurodollar Rate
for any Interest Period shall promptly notify the Borrower and the Lenders.
Each determination by the Agent of an interest rate hereunder shall be
conclusive and binding for all purposes, absent manifest error.
(b) INTEREST ON BASE RATE LOANS. Subject to the provisions of Section
4.01 hereof, (i) in the case of each Revolving Loan or portion thereof that is a
Base Rate Loan, interest shall be payable quarterly on each Quarterly Payment
Date commencing March 31, 2000 (and after maturity (whether by acceleration or
otherwise) upon demand) at an interest rate per annum equal to the Adjusted Base
Rate, and (ii) in the case of the Term Loan if a Base Rate Loan, interest shall
be payable quarterly on each Quarterly Payment Date (and after maturity of such
Loan (whether by acceleration or otherwise) upon demand) at an interest rate per
annum equal to the Adjusted Base Rate. In the event of any change in the Base
Rate, the rate hereunder shall change, effective as of the day the Base Rate
changes.
(c) INTEREST ON TERM LOANS. Notwithstanding any provision to the contrary
in this Agreement or any other Loan Document the interest rate on all Term Loans
shall be either at one Adjusted Eurodollar Rate or at one Base Rate as selected
by Borrower as provided herein.
SECTION 2.11. NOTICE OF CONTINUATION AND NOTICE OF
CONVERSION/UNAVAILABILITY OF CERTAIN LOANS/FUNDING LOSSES.
(a) With respect to any Borrowing consisting of Eurodollar Rate Loans, the
Borrower may, subject to the provisions of Section 2.11(c) and Section 5.02,
elect to maintain such Borrowing or any portion thereof consisting of Eurodollar
Rate Loans by selecting a new Interest Period for such Borrowing, which new
Interest Period shall commence on the day immediately following the last day of
21
the immediately preceding Interest Period. If such election pertains to Term
Loans the election shall be effective for all of the Term Loans then
outstanding. Each selection of a new Interest Period (a "CONTINUATION") shall
constitute a Borrowing and shall be made by written notice given not later than
11:00 a.m. three (3) Business Days prior to the date of any such Continuation
relating to Eurodollar Rate Loans by the Borrower to the Agent. Such Notice of
Continuation shall be by telefacsimile, in substantially the form of Exhibit "D"
hereto, specifying (i) the date of such Continuation which shall be a Business
Day, (ii) the aggregate amount of Loans subject to such Continuation and (iii)
the selected Interest Period, all of which shall be specified in such manner as
is necessary to comply with all limitations on Loans outstanding under this
Agreement. Upon receipt of a Notice of Continuation and two (2) days prior to
the beginning of the new Interest Period, the Agent shall determine the Adjusted
Eurodollar Rate and promptly notify the Borrower and the Lenders in writing
thereof by facsimile transmission. The Borrower may elect to maintain more than
one Borrowing which consists of Revolving Loans but not Term Loans as Eurodollar
Rate Loans by combining such Borrowings into one Borrowing and selecting a new
Interest Period pursuant to this Section 2.11(a); PROVIDED, HOWEVER, that each
of the Borrowings so combined shall consist of Eurodollar Rate Loans having
Interest Periods commencing and ending on the same date. Borrowings of
Revolving Loans may not be combined with Borrowings of Term Loans and vice
versa. If the Borrower shall fail to select a new Interest Period for any
Borrowing consisting of Eurodollar Rate Loans in accordance with this Section
2.11(a), the Agent will continue such Loans as Base Rate Loans.
(b) The Borrower may on any Business Day, upon a Notice of Conversion
given to the Agent, and subject to the provisions of Section 2.11(c) and Section
5.02, convert the entire amount of the outstanding Term Loans or a portion of
all Revolving Loans of one Type into Loans of another Type; PROVIDED, HOWEVER,
that any conversion of any Eurodollar Rate Loans into Loans of another Type
shall be made on, and only on, the last day of an Interest Period for such
Loans. Each such Notice of Conversion shall be given not later than 11:00 a.m.
EST on the same Business Day of any proposed conversion into Base Rate Loans and
three (3) Business Days prior to the date of any proposed Conversion into
Eurodollar Rate Loans. Subject to the restrictions specified above, each Notice
of Conversion shall be made in writing by telefacsimile in substantially the
form of Exhibit "E" hereto specifying (i) the requested date of such Conversion
which shall be a Business Day, (ii) the Type of Loans to be converted, (iii) the
portion of such Type of Loan to be converted, (iv) the Type of Loan into which
such Loans are to be converted and (v) if such Conversion is into Eurodollar
Rate Loans, the requested Interest Period of such Loan. Each Conversion shall
be in an aggregate amount for the Loans of all Lenders of not less than
$1,000,000 or an integral multiple of $100,000 in excess thereof for Eurodollar
Rate Loans and not less than $250,000 or an integral multiple of $100,000 in
excess thereof for Base Rate Loans. Upon receipt of a Notice of Conversion to a
Eurodollar Rate Loan, and two (2) days prior to the beginning of a new Interest
Period the Agent shall determine the Adjusted Eurodollar Rate and shall promptly
notify the Borrower and the Lenders in writing thereof via facsimile
transmission. The Borrower may elect to Convert the entire amount of the
outstanding Term Loans or the entire amount of or a portion of all Revolving
Loans into Loans of another Type. Borrower may convert Revolving Loans into
another Type by combining such Borrowings into one Borrowing consisting of Loans
of another Type; PROVIDED, HOWEVER, that such Loans shall have Interest Periods
ending on the same date.
(c) Notwithstanding paragraphs (a) and (b) above or any other provision of
this Article II to the contrary:
22
(i) if the Agent is unable to determine the Eurodollar Rate for
Eurodollar Rate Loans comprising any requested Borrowing, Continuation or
Conversion, the right of the Borrower to select or maintain Eurodollar Rate
Loans for such Borrowing or any subsequent Borrowing shall be suspended until
the Agent shall notify the Borrower and the Lenders that the circumstances
causing such suspension no longer exists, and each Loan comprising such
Borrowing shall be a Base Rate Loan; and
(ii) if the Lenders shall, at least two (2) Business Days before the
date of any requested Borrowing, Continuation or Conversion, notify the Agent
that the Adjusted Eurodollar Rate for any such Borrowing, Continuation or
Conversion will not adequately reflect the cost to such Lenders of making,
funding or maintaining their respective Loans for such Borrowing, Continuation
or Conversion, the right of the Borrower to select Eurodollar Rate Loans for
such Borrowing shall be suspended until such Lenders notify the Agent and the
Borrower that such rates in fact reflect the cost to such Lenders of making,
funding or maintaining their respective Loans, and each Loan comprising such
Borrowing, Continuation or Conversion shall be a Base Rate Loan.
(d) Each Notice of Borrowing, Notice of Continuation and Notice of
Conversion shall be irrevocable by and binding on the Borrower. In the case of
any Borrowing, Continuation or Conversion that the related Notice of Borrowing,
Notice of Continuation or Notice of Conversion specifies is to be comprised of
Eurodollar Rate Loans, the Borrower shall indemnify each Lender against any
loss, cost or expense incurred by such Lender as a result of any failure of the
Borrower to fulfill for any reason whatsoever including the exercise of any
remedies under Section 11.02, on or before the date for such Borrowing,
Continuation or Conversion specified in such Notice of Borrowing, Notice of
Continuation or Notice of Conversion, the applicable conditions set forth in
Section 5.02 hereof or as a result of the failure of the Borrower to borrow any
such requested Eurodollar Rate Loan, including, without limitation, any loss
(including loss of anticipated profits), cost or expense incurred by reason of
the liquidation or re-employment of deposits or other funds acquired by such
Lender to fund the Loan to be made by such Lender as part of such Borrowing,
Continuation or Conversion, such amount to be determined by each Lender and such
determination by such Lender shall be binding upon the Borrower, absent manifest
error.
SECTION 2.12. VOLUNTARY REDUCTION OF REVOLVING COMMITMENT; VOLUNTARY
PREPAYMENTS; FUNDING LOSSES. (a) The Borrower shall have the right to reduce
permanently the amount of the Revolving Commitment at any time and from time to
time without penalty or premium but in no event more frequently than one time
during any calendar month upon not less than three (3) Business Days prior
written notice which may be by telefacsimile to the Agent of each such
reduction, which notice shall specify the effective date thereof and the amount
of any such reduction (which in the case of any partial reduction shall not be
less than $1,000,000 and integral multiples of $500,000 in excess of that
amount) and shall be irrevocable once given and effective only upon receipt by
the Agent. The Agent will promptly transmit such notice to each Lender.
Notwithstanding the foregoing, in no event shall the Borrower be permitted to
reduce the Revolving Commitment below an aggregate amount equal to the sum of
the aggregate principal amount of Revolving Loans outstanding at such time plus
the aggregate Stated Amounts of all outstanding Letters of Credit at such time.
The Revolving Commitment once reduced pursuant to this Section shall not be
increased.
(b) The Borrower may prepay any Loan at any time; PROVIDED, HOWEVER, that
in the event the Borrower prepays a Eurodollar Rate Loan prior to the end of the
applicable Interest Period therefor for any reason whatsoever including the
exercise of any remedies under Section 11.02, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any such
23
prepayment including, without limitation, any loss (including loss of
anticipated profits after taking into account any reinvestment of funds),
cost or expense incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Lender to fund the Loan made by such
Lender, such amount to be determined by each Lender and such determination by
such Lender shall be binding upon the Borrower absent manifest error. The
Borrower may prepay any Base Rate Loan at any time without penalty or
premium. Any prepayment of the Term Loans shall be applied to scheduled
payments in inverse order of maturity.
SECTION 2.13. UNUSED REVOLVING CREDIT FACILITY FEES. Borrower shall pay
to the Agent for the account of and distribution to the Lenders, a commitment
fee, computed at an annual rate equal to that shown as the Unused Revolver Fee
on the grid incorporated into the definition of Applicable Margin, on the daily
unused portions of the Revolving Commitment of each Lender, such fee being
payable quarterly in arrears on the last Business Day of each fiscal quarter of
Borrower and on the Revolving Termination Date.
ARTICLE III
LETTER OF CREDIT FACILITY
SECTION 3.01. LETTERS OF CREDIT/LENDERS' PARTICIPATION.
(a) Subject to the terms and conditions of this Agreement, the Letter of
Credit Issuer, on behalf of the Lenders, agrees to issue for the account of the
Borrower one or more documentary or standby letters of credit (individually, a
"LETTER OF CREDIT" and collectively, the "LETTERS OF CREDIT") in such form as
may be requested from time to time by the Borrower and agreed to by the Letter
of Credit Issuer, from and including the Effective Date to the L/C Termination
Date, up to a maximum aggregate Stated Amount at any one time outstanding equal
to the lesser of (x) the L/C Commitment Amount and (y) the Available Revolving
Commitment LESS the aggregate outstanding principal amount of Revolving Loans.
Each Letter of Credit shall have an expiration date on or prior to 360 days
after the Date of Issuance of such Letter of Credit.
(b) The Letters of Credit shall be in a form customarily used by the
Letter of Credit Issuer or in such other form as has been approved by the Letter
of Credit Issuer. At the time of issuance, the amount and the terms and
conditions of each Letter of Credit shall be subject to approval by the Letter
of Credit Issuer and the Borrower. Any Letter of Credit containing an automatic
renewal provision shall also contain a provision pursuant to which,
notwithstanding any other provisions thereof, it shall have a final Expiration
Date no later than the L/C Termination Date.
(c) Immediately upon the issuance by the Letter of Credit Issuer of any
Letter of Credit in accordance with the procedures set forth in this
Article III, each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Letter of Credit Issuer, without recourse or
warranty, an undivided interest and participation to the extent of such Lender's
Credit Percentage of the liability of the Letter of Credit Issuer with respect
to such Letter of Credit (including, without limitation, all obligations of the
Borrower with respect thereto, other than amounts owing to the Letter of Credit
Issuer under Section 3.03(b) hereof) and any security therefor or guaranty
pertaining thereto. Accordingly, each Lender severally agrees that it shall be
unconditionally and irrevocably liable, without regard to the occurrence of any
Default or Event of Default or any condition precedent whatsoever, to the extent
of such Lender's Credit Percentage, to reimburse the Letter of Credit Issuer on
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demand in immediately available funds in Dollars for the amount of each Drawing
paid by the Letter of Credit Issuer under each Letter of Credit issued by the
Letter of Credit Issuer to the extent such amount is not reimbursed by the
Borrower pursuant to Section 3.04; PROVIDED, HOWEVER, that the Lenders shall not
be obligated to reimburse the Letter of Credit Issuer pursuant to this
Section 3.01(c) with respect to a Letter of Credit if the Letter of Credit
Issuer issues such Letter of Credit after an Event of Default has occurred and
the Obligations shall have been accelerated and become due and payable pursuant
to Section 11.02(a)(i) or (ii). The failure of any Lender to honor its
obligations hereunder shall not relieve any other Lender of its duty to honor
its obligations hereunder. Upon the written request of a Lender, the Letter of
Credit Issuer shall deliver to such Lender a copy of any Letter of Credit and
copies of all material documents delivered to the Letter of Credit Issuer in
connection with any Drawing with respect to such Letter of Credit.
(d) Each payment made by a Lender to the Letter of Credit Issuer pursuant
to Section 3.01(c) above shall be treated as the purchase by such Lender of a
participating interest in the Borrower's Reimbursement Obligation under
Section 3.04 in an amount equal to such payment. Each Lender, so long as it has
made the payment required to be made by it pursuant to Section 3.01(c), shall
share in accordance with its Credit Percentage in any interest which accrues
pursuant to Section 3.04(b). All amounts recovered by the Letter of Credit
Issuer hereunder or under any other Loan Document and which are applied by the
Letter of Credit Issuer to the Reimbursement Obligations of the Borrower shall
be distributed by the Letter of Credit Issuer to the Lenders who have made the
payments required to be made by them pursuant to Section 3.01(c) PRO RATA in
accordance with their respective Credit Percentages.
(e) In addition to other remedies the Letter of Credit Issuer may have
under Applicable Law and under this Agreement, if and to the extent that any
Lender shall fail to make available to the Letter of Credit Issuer the amount
required to be paid by such Lender pursuant to Section 3.01(c), the Letter of
Credit Issuer shall be subrogated to the rights of such Lender under this
Agreement to the extent of such failure. If any Lender fails to reimburse the
Letter of Credit Issuer as provided in Section 3.01(c), such unreimbursed amount
shall bear interest from the date of the Letter of Credit Issuer's demand
therefor thereof until the date three (3) Business Days after such demand, at
the Federal Funds Rate, and thereafter, until paid, at the Base Rate, such
interest to be payable by such Lender upon demand therefor by the Letter of
Credit Issuer.
SECTION 3.02. METHOD OF ISSUANCE OF LETTERS OF CREDIT.
(a) NOTICE OF ISSUANCE. The Borrower shall give the Letter of Credit
Issuer written notice (or telephonic notice confirmed in writing) at least three
(3) Business Days prior to the requested Date of Issuance of a Letter of Credit,
such notice to be in substantially the form of Exhibit "I" hereto (a "LETTER OF
CREDIT REQUEST"). The Borrower shall also execute and deliver such customary
letter of credit application forms as requested from time to time by the Letter
of Credit Issuer.
(b) ISSUANCE. Provided the Borrower has given the notice prescribed by
Section 3.02(a) and subject to the other terms and conditions of this Agreement,
including, but not limited to, the satisfaction of any applicable conditions
precedent set forth in Article V, the Letter of Credit Issuer shall issue the
requested Letter of Credit on the requested Date of Issuance as set forth in the
applicable Letter of Credit Request on behalf of the Lenders for the benefit of
the stipulated Beneficiary and shall deliver the original of such Letter of
Credit to the Beneficiary at the address specified in the notice. At the
request of the Borrower, the Letter of Credit Issuer shall deliver a copy of
each Letter of Credit to the Borrower
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within a reasonable time after the Date of Issuance thereof. Upon the
written request of the Borrower, the Letter of Credit Issuer shall deliver to
the Borrower a copy of any Letter of Credit proposed to be issued hereunder
prior to the issuance thereof.
(c) REPORTING TO LENDERS. Upon the request of a Lender, the Letter of
Credit Issuer shall report, from time to time but not more frequently than
monthly, to the Lenders the aggregate Stated Amount of all Letters of Credit
then outstanding and such other information concerning the Letters of Credit as
a Lender shall reasonably request. The Letter of Credit Issuer shall, at the
request of a Lender, deliver copies of any Letter of Credit issued hereunder.
Other than as set forth in this Section 3.02 (c), the Letter of Credit Issuer
shall have no duty to notify the Lenders regarding the issuance or other matters
regarding Letters of Credit issued hereunder. The failure of the Letter of
Credit Issuer to perform its requirements under this Section 3.02(c) shall not
relieve the Lenders' reimbursement obligations under Section 3.01(c).
SECTION 3.03. LETTER OF CREDIT FEES. In consideration for the issuance of
each Letter of Credit hereunder, the Borrower hereby agrees to pay (a) to the
Agent, for the ratable account of the Lenders in accordance with their
respective Credit Percentages, a letter of credit fee of one percent (1%) of the
Stated Amount, and (b) to the Letter of Credit Issuer for such Letter of Credit,
for the account of such Letter of Credit Issuer, a fronting fee accruing at a
rate per annum equal to .25% on the Stated Amount from time to time of such
Letter of Credit. The fee provided in (b) above shall be payable quarterly in
arrears on the last Business Day of each calendar quarter and on the L/C
Termination Date.
SECTION 3.04. LETTER OF CREDIT REIMBURSEMENT.
(a) NOTICE OF DRAWING. The Letter of Credit Issuer shall promptly
notify the Borrower and each Lender by telephone, telecopy, telex or other
telecommunication of any Drawing under a Letter of Credit and of the
anticipated date for payment (the "PAYMENT DATE"). On the Payment Date, the
Letter of Credit Issuer shall confirm to the Borrower and each Lender by
telephone or telecopy that payment of the Drawing is to be made by the Letter
of Credit Issuer on such date.
(b) PAYMENTS. The Borrower hereby agrees to pay to the Letter of Credit
Issuer, in the manner provided in Section 3.04(c):
(i) on each Payment Date, an amount equal to the amount paid by the
Letter of Credit Issuer under a Letter of Credit; and
(ii) if any Drawing shall be reimbursed to the Letter of Credit
Issuer after 2:00 p.m. on the Payment Date, interest on any and all amounts
required to be paid pursuant to clause (i) of this Section 3.04(b) from and
after the due date thereof until payment in full, payable on demand, at an
annual rate of interest equal to the Post-Default Rate.
(c) METHOD OF REIMBURSEMENT. The Borrower shall reimburse the Letter of
Credit Issuer for each Drawing under any Letter of Credit in the following
manner:
(i) the Borrower shall immediately reimburse the Letter of Credit
Issuer in accordance with Section 4.04; or
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(ii) (A) if the Borrower has not reimbursed the Letter of Credit
Issuer pursuant to subparagraph (i) above and (B) the applicable conditions set
forth in Article V have been fulfilled and (C) the Available Revolving
Commitment in effect at such time LESS the aggregate Stated Amounts of all
outstanding Letters of Credit at such time equals or exceeds the amount of the
Drawing to be reimbursed, the Borrower shall request a Borrowing of Revolving
Loans as provided in Section 3.04(d), and the proceeds of such Borrowing shall
be made available to the Letter of Credit Issuer, by wire transfer of
immediately available funds at the address of the Letter of Credit Issuer set
forth on the signature pages hereof and pursuant to the wiring instructions
specified on Exhibit "J" for the Letter of Credit Issuer in satisfaction of the
obligations of the Borrower set forth in subparagraph (i) above; or
(iii) Pursuant to Section 4.04 but subject to Section 4.06, the Agent
may debit any deposit account of the Borrower maintained with it in an amount
equal to the amount of such Drawing and make available such amount to the Letter
of Credit Issuer, by wire transfer of immediately available funds at the address
of the Letter of Credit Issuer set forth on the signature pages hereof and
pursuant to the wiring instructions specified on Annex 1 for the Letter of
Credit Issuer in satisfaction of the obligations of the Borrower set forth in
subparagraph (i) above.
(d) LOANS TO FUND DRAWINGS. Upon any Drawing, the Letter of Credit
Issuer shall notify Agent if the Borrower has elected to reimburse the Letter
of Credit Issuer using the proceeds of Revolving Loans. Upon receipt of such
notice and if the conditions set forth in subparagraph (c)(ii) above have
been satisfied, each Lender agrees to deliver to the Letter of Credit Issuer
its PRO RATA share of the amount of Loans necessary to reimburse the Letter
of Credit Issuer for any payment made by the Letter of Credit Issuer pursuant
to such Drawing not later than one Business Day after receipt of such notice.
Any funds delivered to the Letter of Credit Issuer under this paragraph (d)
shall be delivered in the manner set forth in the first sentence of Section
2.03. Unless the Borrower complies with the applicable notice requirements
as set forth in Section 2.02(a), any Loan used to repay any Reimbursement
Obligation shall initially be a Base Rate Loan.
SECTION 3.05. NATURE OF LETTER OF CREDIT ISSUER'S DUTIES. In determining
whether to honor any Drawing under any Letter of Credit, the Letter of Credit
Issuer shall be responsible only to determine that the documents and
certificates required to be delivered under that Letter of Credit have been
delivered and that they materially comply on their face with the requirements of
that Letter of Credit. The Borrower otherwise assumes all risks of the acts and
omissions of, or misuse of the Letters of Credit issued by the Letter of Credit
Issuer by, the respective Beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, but subject to the last
sentence of this Section 3.05, neither the Letter of Credit Issuer nor any of
the other Lenders shall be responsible (i) for the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in
connection with the application for and issuance of, or any Drawing honored
under, a Letter of Credit even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit, or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) for errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex, telecopy or otherwise, whether or not they be in
cipher; (iv) for errors in interpretation of technical terms; (v) for any loss
or delay in the transmission or otherwise of any document required in order to
make a drawing under a Letter of Credit, or the proceeds thereof; (vi) for the
misapplication by the Beneficiary of a Letter of Credit, of the proceeds of any
drawing honored under a Letter of Credit; and (vii) for any consequences arising
from causes beyond the control of the Letter of Credit Issuer or the other
Lenders.
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None of the above shall affect, impair or prevent the vesting of any of the
Letter of Credit Issuer's rights or powers hereunder. Without limitation of
the foregoing, any action taken or omitted to be taken by the Letter of
Credit Issuer under or in connection with any Letter of Credit, if taken or
omitted in the absence of gross negligence or willful misconduct, shall not
create against the Letter of Credit Issuer any liability to the Borrower or
any Lender.
SECTION 3.06. OBLIGATIONS ABSOLUTE. The obligations of the Borrower to
reimburse the Letter of Credit Issuer for Drawings honored under Letters of
Credit and the obligations of the Lenders under Section 3.01(c) to reimburse the
Letter of Credit Issuer for any Reimbursement Obligation not reimbursed by the
Borrower shall be joint and several and unconditional and irrevocable and shall
be paid strictly in accordance with the terms of this Agreement under all
circumstances including, without limitation, the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, set-off, defense or other right
which the Borrower or any Affiliate of the Borrower may have at any time
against a Beneficiary or any transferee of any Letter of Credit (or any
Persons or entities for whom any such Beneficiary or transferee may be
acting), the Letter of Credit Issuer, any Lender or any other Person, whether
in connection with this Agreement, the transactions contemplated herein or
any unrelated transaction;
(iii) any draft, demand, certificate or other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan Documents;
(v) any non-application or misapplication by the Beneficiary of
the proceeds of any Drawing under a Letter of Credit;
(vi) the fact that a Default or Event of Default shall have
occurred and be continuing; or
(vii) any other circumstance or happening whatsoever that may
constitute a legal or equitable discharge of the obligations of the Borrower
to reimburse the Letter of Credit Issuer for Drawings on Letters of Credit or
of the obligations of the Lenders under Section 3.01(e) to reimburse the
Letter of Credit Issuer for any Reimbursement Obligation not so reimbursed by
the Borrower.
SECTION 3.07. EXPIRATION DATE OF LETTERS OF CREDIT. If on the date (the
"FACILITY TERMINATION DATE") this Agreement and the Letter of Credit Facility is
terminated prior to the Expiration Date of any Letter of Credit outstanding
hereunder, the Borrower shall, on the Facility Termination Date, deposit with
the Letter of Credit Issuer an amount of money equal to the Stated Amount of
such Letter of Credit in the Cash Collateral Account. If a Drawing pursuant to
such Letter of Credit occurs on or prior to the Expiration Date of such Letter
of Credit, the Borrower authorizes the Letter of Credit Issuer to use the monies
deposited in the Cash Collateral Account to make payment to the Beneficiary with
respect to such Drawing. If no Drawing occurs on or prior to the Expiration
Date of such Letter of Credit, the Letter of Credit Issuer shall return to the
Borrower the monies deposited in the Cash Collateral Account with
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respect to such outstanding Letter of Credit on the date which is five (5)
Business Days after the Expiration Date of such Letter of Credit. The
Borrower hereby collaterally assigns to the Letter of Credit Issuer for its
benefit and the benefit of the Lenders and grants to the Letter of Credit
Issuer for its benefit and the benefit of the Lenders, a security interest in
all funds held in the Cash Collateral Account from time to time and proceeds
thereof, as security for the payment of all amounts due and to become due
from the Borrower to the Letter of Credit Issuer and the Lenders under this
Agreement. The Cash Collateral Account shall be in the name of the Borrower
and the Letter of Credit Issuer as a cash collateral account but the Letter
of Credit Issuer shall have sole dominion and control over, and sole access
to, the Cash Collateral Account. Neither the Borrower nor any Person claiming
on behalf of or through the Borrower shall have any right to withdraw any of
the funds held in the Cash Collateral Account. The Borrower agrees that it
will not (i) sell or otherwise dispose of any interest in the Cash Collateral
Account or any funds held therein, or (ii) create or permit to exist any Lien
upon or with respect to the Cash Collateral Account or any funds held
therein, except as provided in or contemplated by this Agreement. The Letter
of Credit Issuer shall exercise reasonable care in the custody and
preservation of any funds held in the Cash Collateral Account and shall be
deemed to have exercised such care if such funds are accorded treatment
substantially equivalent to that which the Letter of Credit Issuer accords
other funds deposited with the Letter of Credit Issuer, it being understood
that the Letter of Credit Issuer shall not have any responsibility for taking
any necessary steps to preserve rights against any parties with respect to
any funds held in the Cash Collateral Account.
SECTION 3.08. VOLUNTARY REDUCTION OF L/C COMMITMENT. The Borrower
shall have the right to reduce permanently the amount of the L/C Commitment
at any time and from time to time without penalty or premium but in no event
more frequently than one time during any calendar month upon not less than
three (3) Business Days prior written notice to the Letter of Credit Issuer
of each such reduction, which notice shall specify the effective date thereof
and the amount of any such reduction (which in the case of any partial
reduction shall not be less than $1,000,000 and integral multiples of
$100,000 in excess of that amount) and shall be irrevocable once given and
effective only upon receipt by the Letter of Credit Issuer. The Letter of
Credit Issuer will promptly transmit such notice to each Lender.
Notwithstanding the foregoing, in no event shall the Borrower be permitted to
reduce the L/C Commitment below an amount equal to the aggregate Stated
Amount of the Letters of Credit outstanding at such time. The L/C Commitment
once reduced pursuant to this Section may not be increased.
ARTICLE IV
OTHER LOAN AND PAYMENT PROVISIONS
SECTION 4.01. INTEREST ON OVERDUE PAYMENTS. In the event the Borrower
shall fail to pay when due (whether upon demand, at maturity, as required
under Sections 2.05 and 2.09, by reason of acceleration or otherwise) any
principal of, or interest on, any of the Loans or any Reimbursement
Obligation or any other amount owing hereunder or under any Note or other
Loan Document when due, such overdue amounts shall bear interest at the
Post-Default Rate until such unpaid amount has been paid in full (whether
before or after judgment). All interest provided for in this Section shall
be immediately due and payable upon demand.
SECTION 4.02. COMPUTATIONS. Unless otherwise expressly set forth
herein, any accrued interest on any Loan and any accrued Fees shall be
computed on the basis of a year of 360 days and the actual number of days
elapsed.
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SECTION 4.03. USURY. In no event shall the amount of interest due or
payable in respect of the Loans exceed the maximum rate of interest allowed
by Applicable Law and, in the event any such amount in excess of the maximum
rate of interest allowed by Applicable Law is paid by the Borrower or
received by any Lender, then such excess sum shall be credited as a payment
of principal, unless the Borrower shall notify the respective Lender in
writing that the Borrower elects to have such excess sum returned to it
forthwith. It is the express intent of the parties hereto that the Borrower
not pay and the Lenders not receive, directly or indirectly, in any manner
whatsoever, interest in excess of that which may be lawfully paid by the
Borrower under Applicable Law.
SECTION 4.04. PAYMENTS. Except to the extent otherwise provided herein
or in the Notes, all payments of principal, interest and other amounts to be
made by the Borrower under this Agreement, the Notes or any other Loan
Document shall be made in Dollars, in immediately available funds, to the
Agent at the Agent's Principal Office, not later than 2:00 p.m. EST 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) and shall be made in accordance with the wiring
instructions set forth for the Agent on Annex I attached hereto. The parties
agree that if the Borrower makes any payment due hereunder after 2:00 p.m.
EST but before 5:00 p.m. EST on the date such payment is due, such late
payment shall not constitute a Default under Section 11.01(a) hereof but
shall nevertheless be deemed to have been paid as of the next succeeding
Business Day as provided in the parenthetical phrase of the preceding
sentence. Subject to Sections 4.05 and 4.06 hereof, the Agent or any Lender
for whose account any such payment is made, may (but shall not be obligated
to) debit the amount of any such payment which is not made by such time from
any special or general deposit account of the Borrower with the Agent or such
Lender, as the case may be (with notice to the Borrower, the other Lenders
and the Agent). The Borrower shall, at the time of making each payment under
this Agreement or any Note, specify to the Agent the amounts payable by the
Borrower hereunder to which such payment is to be applied, and in the event
that it fails to so specify, or an Event of Default has occurred and is
continuing, the Agent shall apply such payment to the Loans, any
Reimbursement Obligation or any other obligation of the Borrower under the
Loan Documents in such manner as the Agent may determine to be appropriate,
subject to Section 4.05 hereof. Each payment received by the Agent for the
account of the Lenders under this Agreement or any Note shall be paid
promptly to such Lender (but no later than the next Business Day), by wire
transfer of immediately available funds in accordance with the wiring
instructions set forth for such Lender on the Annex I attached hereto, for
the account of such Lender at the applicable Lending Office of such Lender.
If the due date of any payment under this Agreement or any Note would
otherwise fall on a day which is not a Business Day such date shall be
extended to the next succeeding Business Day and interest shall be payable
for the period of such extension; PROVIDED, HOWEVER, that in no event shall
any such due date be extended beyond the Revolving Termination Date and Term
Loan Maturity Date.
SECTION 4.05. PRO RATA TREATMENT. Unless set forth to the contrary
herein, (a) each Borrowing of Revolving Loans and Term Loans, (b) each
payment of the principal of or interest on the Revolving Loans and the Term
Loans, and (c) each other payment to be made by the Borrower hereunder or
under any Loan Document shall be made by, or credited to the account of, the
Lenders PRO RATA in accordance with their respective Credit Percentages. All
fees referred to in Section 3.03(b) shall be for the sole account of the
respective Letter of Credit Issuer.
SECTION 4.06. SHARING OF PAYMENTS, ETC. The Borrower 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 offset balances held by it for the account of the Borrower
at
30
any of such Lender's offices, in Dollars or in any other currency, against
any principal of, or interest on, any of such Lender's Loans hereunder (or
other Obligations, if any, owing to such Lender hereunder) which is not paid
when due (regardless of whether such balances are then due to the Borrower),
in which case such Lender shall promptly notify the Borrower, all other
Lenders and the Agent thereof; PROVIDED, HOWEVER, such Lender's failure to
give such notice shall not affect the validity of such offset. If a Lender
shall obtain payment of any principal of, or interest on, any Loan made by it
to the Borrower under this Agreement, or shall obtain payment on any other
Secured Obligation, if any, owing by the Borrower or a Subsidiary through the
exercise of any right of set-off, banker's lien or counterclaim or similar
right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the
terms of this Agreement and such payment, pursuant to Section 4.05 hereof,
should be distributed to the Lenders PRO RATA in accordance with their Credit
Percentage, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans made by the other Lenders or other Obligations
arising under or in connection with the Loan Documents owed to such other
Lenders 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 payment (net of any expenses which may be incurred by such Lender in
obtaining or preserving such benefit) PRO RATA in accordance with their
respective Credit Percentages. 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. The Borrower agrees that any Lender so purchasing a participation
(or direct interest) in the Loans or other Obligations arising under or in
connection with the Loan Documents owed to such other Lenders made by other
Lenders 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 in the amount of such participation. 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 the Borrower.
SECTION 4.07. INSUFFICIENT FUNDS. If on any date the Agent receives
funds insufficient to pay in full the principal of any Loans, any
Reimbursement Obligation, or any interest, fees or expenses due and payable
on or prior to such date, the Agent shall distribute any such funds received
by it:
(a) FIRST, to pay all reasonable expenses due and payable to the
Agent PRO RATA in accordance with the respective amounts of such fees and
expenses due and payable to Agent;
(b) SECOND, to pay all fees and expenses due and payable to the
Lenders (including the Letter of Credit Issuers) PRO RATA in accordance with
the respective amounts of such fees and expenses due and payable to each such
Lender;
(c) THIRD, to pay all accrued but unpaid interest on all
outstanding Loans PRO RATA in accordance with Section 4.05; and
(d) FOURTH, to pay all amounts of principal outstanding on the
Loans and any Reimbursement Obligation PRO RATA in accordance with Section
4.05.
SECTION 4.08. FEES. All Fees payable on a per annum percentage basis
shall be calculated on the basis of the actual number of days elapsed in a
360-day year. All Fees shall be payable in addition to, and not in lieu of,
interest, compensation, expense, reimbursement, indemnification and other
31
Obligations. All Fees shall be fully earned and non-refundable when paid.
All Fees shall bear interest, if not paid when due, at the Post-Default Rate
and shall constitute Obligations.
SECTION 4.09. [INTENTIONALLY OMITTED]
SECTION 4.10. INCREASED COSTS. The Borrower agrees that if: (a) any
change after the Agreement Date in any law, executive order or regulation or
in any request, guideline or directive of any administrative or governmental
authority (whether or not having the force of law) or in the interpretation
thereof by any court or administrative or governmental authority charged with
administration thereof, shall either impose, affect, modify or deem
applicable any reserve, special deposit, capital maintenance or similar
requirement against any Loan or Letter of Credit or the participation of any
Lender therein or impose on the Agent, any Letter of Credit Issuer or any
Lender any other condition regarding any Loan or Letter of Credit or any
Lender's participation therein or (b) there shall occur any change after the
Agreement Date in the basis of taxation of payments to any Lender, any Letter
of Credit Issuer or the Agent of any amount owing to such Lender, any Letter
of Credit Issuer or the Agent hereunder (except for a change in the rate of
taxation on the overall net income of the Agent, any Letter of Credit Issuer
or any Lender or the branches or foreign Subsidiaries of the Agent, any
Letter of Credit Issuer or any Lender), and the result of any event referred
to in clause (a) or (b) above shall be to increase the cost to such Lender,
any Letter of Credit Issuer or the Agent of making or maintaining any Loan or
issuing or maintaining any Letter of Credit hereunder or to reduce the rate
of return on capital with respect to any Loan or Letter of Credit, then, upon
demand by the Agent, any Letter of Credit Issuer or any such Lender, as the
case may be, the Borrower shall immediately pay to the Agent, any Letter of
Credit Issuer or such Lender, as the case may be, additional amounts which
shall be sufficient to compensate the Agent, any Letter of Credit Issuer or
such Lender for such increased cost, tax or reduced rate of return, together
with interest on such amount from the date fifteen days after the date the
Borrower receives the statement(s) referred to in the next sentence to the
date the Borrower pays such increased cost, tax or reduced rate of return in
full at the Base Rate. A statement setting forth the basis for requesting
such compensation and the method for determining the amount thereof,
submitted by the Agent, any Letter of Credit Issuer or such Lender, as the
case may be, to the Borrower, shall be conclusive, absent manifest error.
SECTION 4.11. STATEMENTS OF ACCOUNT. The Agent will account to the
Borrower upon request but not more frequently than monthly with a statement
of Loans, Letters of Credit, charges and payments made pursuant to this
Agreement and the other Loan Documents, and such account rendered by the
Agent shall be deemed final, binding and conclusive upon Borrower unless the
Agent is notified by the Borrower in writing within thirty days after the
date each account is delivered to Borrower that the Borrower objects to the
information, calculations or items therein contained. Such notice shall only
be deemed an objection to those items specifically objected to therein. The
failure of the Agent to deliver such a statement of accounts shall not
relieve or discharge the Borrower from its obligations hereunder.
SECTION 4.12. DEFAULTING LENDER'S STATUS. Notwithstanding anything
contained herein to the contrary, but in addition to provisions regarding the
failure of a Lender to perform its obligations hereunder set forth elsewhere in
this Agreement, so long as any Lender shall be in default in its obligation to
fund its Credit Percentage of any Revolving Loan or participate to the extent of
such Lender's Credit Percentage of any Reimbursement Obligation or shall have
rejected its Commitment, then for purposes of voting or consenting to matters
with respect to the Loan Documents, such Lender's Credit Percentage shall be
deemed to be reduced prorata in proportion to the failure to fund, unless and
until such failure to fulfill its obligation to fund is cured and such Lender
shall have paid, as and to the
32
extent provided in this Agreement, to the applicable party, such amount then
owing together with interest thereon as provided in this Agreement. No
Commitment of any Lender shall be increased or otherwise affected by any such
failure or rejection by any Lender.
SECTION 4.13. AGENT'S RELIANCE. Neither the Agent nor any Lender shall
incur any liability to the Borrower for acting upon any telefacsimile or
telephonic notice referred to in this Agreement which the Agent or such
Lender believes in good faith to have been given by a person authorized to
deliver a Notice of Borrowing or a Request for Letter of Credit on behalf of
the Borrower under Sections 2.02, 2.07, 2.11, 2.18, 3.02 or 3.08 hereof or
for otherwise acting in good faith.
ARTICLE V
CONDITIONS PRECEDENT
SECTION 5.01. CONDITIONS PRECEDENT TO EFFECTIVENESS. The effectiveness
of this Agreement, and the obligation of the Lenders to make any Loans to the
Borrower in accordance with the terms hereof and the obligation of any Letter
of Credit Issuer to issue Letters of Credit in accordance with the terms
hereof, are subject to the condition precedent that the Borrower deliver to
the Agent each of the following, each of which shall be satisfactory in form
and substance to the Lenders:
(a) A Revolving Note executed and delivered by the Borrower,
payable to each Lender and complying with the terms of Section 2.06;
(b) A Term Note executed and delivered by the Borrower, payable
to each Lender and complying with the requirements of Section 2.08;
(c) The Pledge Agreement executed and delivered by Borrower to
the Agent together with the original stock certificates for 65% of the issued
and outstanding common stock of each of the Current Subsidiaries pledged and
any other documentation required by Agent to perfect the Security Interest in
those shares.
(d) Estoppel letters from each of the holders of the Senior Notes
stating the amount required to repay the Senior Notes in full.
(e) Copies certified as of the Effective Date by the respective
Secretary or Assistant Secretary of Borrower (each such Person shall be the
"AUTHENTICATING PERSON" with respect to Borrower) of all corporate and other
necessary action taken by Borrower to authorize the execution, delivery and
performance of the Loan Documents to which it is a party;
(f) (i) Copies certified as of the Effective Date by an
Authenticating Person of the articles of incorporation of Borrower and each
Subsidiary (certified by the Secretary of State or other appropriate
authority of the jurisdiction of its incorporation) and by-laws of Borrower
or each Subsidiary; (ii) a certificate of existence or other good standing
certificate for Borrower and each Subsidiary issued as of a recent date by
the Secretary of State of the jurisdiction of its incorporation, of the State
in which its principal place of business is located and of each State in
which any Inventory is located; and (iii) certificates dated as of the
Effective Date signed by an Authenticating Person with respect to the
incumbency and specimen signatures of each of the officers or other Persons
of Borrower
33
and each Subsidiary who are authorized to execute and deliver this Agreement
and the other Loan Documents to which Borrower or a Subsidiary is a party;
(g) Copies of each of the policies of insurance (or binder or
certificate of insurance with respect thereto) covering any of the tangible
insurable property of the Borrower, together with loss payable clauses naming
the Agent on behalf of the Lenders as loss payee, and naming the Agent on
behalf of the Lenders as additional insureds which comply with the terms of
the relevant Loan Documents;
(h) Favorable UCC, tax, judgment and lien search reports with
respect to the Borrower and any Subsidiary in all necessary or appropriate
jurisdictions and under all legal and appropriate trade names indicating that
there are no prior Liens on any of the property of Borrower or any Subsidiary
other than Permitted Liens;
(i) An opinion of counsel to the Borrower, dated the Effective
Date and addressed to the Agent and the Lenders, in form and content
reasonably satisfactory to the Agent and the Lenders;
(j) A disbursement letter executed by the Borrower authorizing
the disbursement of the proceeds of the Term Loans and any other Loans to be
made on the Effective Date;
(k) A Borrowing Base Certificate duly completed by the Borrower,
such certificate to be prepared as of the Effective Date;
(l) [Intentionally Omitted].
(m) A certificate from the chief financial officer of the
Borrower dated the Effective Date to the effect that no material adverse
change in the financial condition, business, operations or prospects of the
Borrower or any of its Subsidiaries has occurred since June 30, 1999; and
(o) Such other documents and instruments as Agent or any Lender
may reasonably request.
SECTION 5.02. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The
obligations of the Lenders to make Revolving Loans and the Term Loans and of
any Letter of Credit Issuer to issue Letters of Credit are subject to the
further condition precedent that, as of the date of each such Revolving Loan,
and Term Loan and Date of Issuance of each such Letter of Credit and after
giving effect thereto: (a) no Default or Event of Default shall have occurred
and be continuing; (b) the representations and warranties made or deemed made
by the Borrower in this Agreement and the other Loan Documents to which it is
a party shall be true and correct in all material respects on and as of the
date of the making of such Loan or the Date of Issuance of such Letter of
Credit with the same force and effect as if made on and as of such date
except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and
warranties shall have been true and accurate on and as of such earlier date);
(c) no event or condition having a Material Adverse Effect with respect to
the Borrower has occurred since the Effective Date and (d) the Borrower is in
compliance with the Borrowing Base requirements. Each Notice of Borrowing,
Continuation or Conversion, and Request for Letter of Credit delivered by the
Borrower hereunder and each borrowing of Loans or issuance of a Letter of
Credit shall constitute a certification by the Borrower to the effect set
forth in the preceding sentence (both as of the date of such Notice of
Borrowing, Continuation or Conversion or Request for Letter of Credit and,
unless
34
the Borrower otherwise notifies the Agent prior to the date of such borrowing
or issuance, as of the date of such borrowing or issuance).
SECTION 5.03. CONDITIONS AS COVENANTS. In the event the Lenders make
any Revolving Loan or Term Loan, or the Letter of Credit Issuer issues a
Letter of Credit on or after the Agreement Date and prior to the satisfaction
of all conditions precedent set forth in Section 5.01 hereof, the Borrower
shall nevertheless cause such condition or conditions to be satisfied within
thirty days after the date of the making of such Loan or the issuance of such
Letter of Credit.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Agent and each of the Lenders as follows:
(a) ORGANIZATION; POWER; QUALIFICATION. Each of the Borrower and its
Subsidiaries is a corporation duly formed, validly existing and in good
standing under the laws of its jurisdiction of incorporation, has the power
and authority to own or lease its properties and to carry on its business as
now being and hereafter proposed to be conducted and is duly qualified and is
in good standing as a foreign corporation, and authorized to do business, in
each jurisdiction in which the character of its properties or the nature of
its business requires such qualification or authorization and where the
failure to be so qualified or authorized could have a Material Adverse Effect
on the Borrower or such Subsidiary.
(b) OWNERSHIP STRUCTURE. Schedule 6.01(b) correctly sets forth as of
November 11, 1999, the corporate structure of Borrower and ownership
interests of the ten (10) shareholders (as provided to Borrower from a
Xxxxxxxx Screen and for which Borrower does not undertake to verify the
accuracy but which to the best of Borrower's knowledge and belief is not
incorrect) owning the greatest number of shares of the Borrower including the
correct legal name of the Borrower. Except as set forth in Schedule 6.01(b)
neither the Borrower nor any Subsidiary has issued to any third party any
securities convertible into or exercisable for equity interests in the
Borrower or any Subsidiary or any options, warrants or other rights to
acquire any securities convertible into or exercisable for such equity
interests.
(c) AUTHORIZATION OF AGREEMENT, NOTES, LOAN DOCUMENTS AND BORROWINGS.
The Borrower has the right and power, and has taken all necessary action to
authorize it, to borrow hereunder and to execute, deliver and perform this
Agreement, the Notes and the other Loan Documents to which it is a party in
accordance with their respective terms and to consummate the transactions
contemplated hereby. This Agreement, the Notes and each of the other Loan
Documents to which the Borrower is a party have been duly executed and
delivered by the duly authorized officers of the Borrower and each is a
legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with its respective terms; provided that
enforceability of the Loan Documents is subject to limitation by the general
principles of equity and to bankruptcy, insolvency and similar laws affecting
the enforcement of creditors' rights generally.
(d) NO VIOLATION OF LAWS, ETC. The execution, delivery and performance by
Borrower of any Loan Document to which it is a party in accordance with its
terms and the Credit Events hereunder do not and will not, by the passage of
time, the giving of notice, a determination of materiality, the satisfaction
35
of any condition, any combination of the foregoing, or otherwise: (i)
require any Governmental Approval or violate any Applicable Law relating to
Borrower; (ii) conflict with, result in a breach of or constitute a default
under the charter or bylaws of Borrower, or any indenture, agreement or other
instrument to which the Borrower or any of its Subsidiaries is a party or by
which it or any of its properties may be bound where such conflict, breach or
default could have a Material Adverse Effect on Borrower; or (iii) result in
or require the creation or imposition of any Lien upon or with respect to any
property now owned or hereafter acquired by the Borrower or any of its
Subsidiaries other than Permitted Liens.
(e) COMPLIANCE WITH LAW; GOVERNMENTAL APPROVALS. The Borrower and each
Subsidiary is in compliance with each Governmental Approval applicable to it
and in compliance with all other Applicable Law relating to the Borrower and
each Subsidiary, except for noncompliances which, and Governmental Approvals
the failure to possess which, would not, singly or in the aggregate, cause a
Default or Event of Default or have a Material Adverse Effect on the Borrower
or the Subsidiary and in respect of which adequate reserves have been
established on the books of the Borrower or the Subsidiary in accordance with
GAAP.
(f) TITLES TO PROPERTIES. Each of the Borrower and its Subsidiaries
has good, marketable and legal title to, or a valid leasehold interest in,
its properties and assets including, but not limited to, those reflected on
the consolidated balance sheet of Borrower as at June 30, 1999, except those
which have been disposed of by the Borrower or such Subsidiary subsequent to
such date in the ordinary course of business. None of the properties or
assets owned by the Borrower or any of its Subsidiaries and none of the
Borrower's or any of its Subsidiaries' leasehold interests are subject to any
Lien, except Permitted Liens.
(g) INDEBTEDNESS AND GUARANTEES. Schedule 6.01(g) is a complete and
correct listing of all (i) Indebtedness for Money Borrowed of the Borrower or
any Subsidiary, (ii) Guarantees of the Borrower or any Subsidiary, and (iii)
all letters of credit and acceptances issued or created by any Person for the
account of the Borrower or any Subsidiary. The Borrower and its Subsidiaries
have performed and are in compliance with all of the terms of such
Indebtedness and such Guarantees and all instruments and agreements relating
thereto, and no default or event of default, or event or condition which with
the giving of notice, the lapse of time, a determination of materiality, the
satisfaction of any other condition or any combination of the foregoing,
would constitute such a default or event of default, exists with respect to
any such Indebtedness or Guarantees, the aggregate principal balance of which
exceeds $250,000.
(h) LITIGATION. Except as set forth on Schedule 6.01(h), there are no
actions, suits or proceedings pending (nor, to the knowledge of the Borrower,
threatened, nor is there any basis therefor) against or in any other way
relating adversely to or affecting the Borrower or any Subsidiary or any of
their respective property in any court or before any arbitrator of any kind
or before or by any governmental body which could have a Material Adverse
Effect on Borrower or any Subsidiary. There are no strikes or walkouts in
progress relating to any labor contracts to which the Borrower or any
Subsidiary is a party.
(i) TAX RETURNS AND PAYMENTS. All federal, state and other tax returns of
the Borrower required by Applicable Law to be filed have been duly filed, and
all federal, state and other taxes, assessments and other governmental charges
or levies upon the Borrower and its properties, income,
36
profits and assets which are due and payable have been paid, except any such
nonpayment which is at the time permitted under Section 7.06.
(j) FINANCIAL STATEMENTS. The Borrower has furnished to each Lender
copies of the consolidated balance sheet of the Borrower as at June 30, 1999,
and the related consolidated statements of income and cash flows for the
period covered thereby, certified by the President or Chief Financial Officer
or other senior executive officer of the Borrower to be complete and correct
and present fairly in all material respects, in accordance with GAAP
consistently applied throughout the period involved, the financial position
of the Borrower as at its date and the results of operations and the cash
flows for such period. Except as disclosed in such balance sheet or
statements, the Borrower and its Subsidiaries have no material liabilities,
contingent or otherwise, and nor were there any material unrealized or
anticipated losses of the Borrower or any of its Subsidiaries for the period
covered thereby.
(k) ERISA. The Borrower and its Affiliates are in compliance with
ERISA in all material respects. No Reportable Event has occurred and is
continuing with respect to any Plan; to the knowledge of the Borrower, no
notice of intent to terminate a Plan has been filed nor has any Plan been
terminated, the termination of which would result in liability to the
Borrower or any Subsidiary of the Borrower in excess of $50,000 in the
aggregate at any one time; no circumstance exists which constitutes grounds
under Section 4042 of ERISA entitling the PBGC to institute proceedings to
terminate, or appoint a trustee to administer, a Plan, nor has the PBGC
instituted any such proceedings; neither the Borrower nor any Affiliate has
completely or partially withdrawn under Sections 4201 or 4204 of ERISA from a
Multiemployer Plan which withdrawal would result in liability to the Borrower
in excess of $50,000 in the aggregate at any one time; the Borrower and each
Affiliate has met its minimum funding requirements under ERISA with respect
to all of its Plans and there are no unfunded vested liabilities in excess of
$50,000 in the aggregate at any one time; and neither the Borrower nor any
Affiliate has incurred any liability to the PBGC under ERISA in excess of
$50,000 in the aggregate at any one time, which liability has not been
satisfied.
(l) ABSENCE OF DEFAULTS. No event has occurred and is continuing: (i)
which constitutes a Default or an Event of Default; or (ii) which
constitutes, or which with the passage of time, the giving of notice, a
determination of materiality, the satisfaction of any condition, or any
combination of the foregoing, would constitute, a default or event of default
by the Borrower or any of its Subsidiaries under any material agreement
(other than this Agreement) or judgment, decree or order to which the
Borrower or any of its Subsidiaries is a party or by which the Borrower or
any of its Subsidiaries or any of their properties may be bound.
(m) ACCURACY AND COMPLETENESS OF INFORMATION. All written information,
reports and other papers and data furnished to Agent or any Lender by, on
behalf of, or at the direction of, Borrower or any Subsidiary (including,
without limitation, all information regarding location, amount and other
particulars of the Inventory and Accounts of the Borrower and its
Subsidiaries) were, at the time the same were so furnished, complete and
correct in all material respects, to the extent necessary to give the
recipient a true and accurate knowledge of the subject matter, or, in the
case of financial statements, present fairly in all material respects, in
accordance with GAAP consistently applied throughout the periods involved,
the financial position of the Persons involved as at the date thereof and the
results of operations for such periods. No fact is known to the Borrower
which has had, or may in the future have (so far as the Borrower can
reasonably foresee), a Material Adverse Effect upon the Borrower or any
Subsidiary which has not been set forth in the financial statements referred
to in Section 6.01(j) or in such information, reports or other papers or data
or otherwise disclosed in writing to the Agent and the
37
Lenders prior to the Agreement Date. No document furnished or statement made
to any Agent or Lender in connection with the negotiation, preparation or
execution of this Agreement or any of the other Loan Documents contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact necessary in order to make the statements contained
therein not misleading.
(n) ENVIRONMENTAL LAWS. Borrower and its Subsidiaries are in
compliance in all material respects with all terms and conditions of all
Governmental Approvals required under Environmental Laws to be obtained by
Borrower and its Subsidiaries for operation in the ordinary course of
business. Neither the Borrower nor any of its Subsidiaries is aware of, or
has received notice of, any past, present, or future events, conditions,
circumstances, activities, practices, incidents, actions, or plans which may
prevent compliance or continued compliance in all material respects with
Environmental Laws which have not been completely remediated to the extent
required by the applicable Environmental Laws. There is no civil, criminal,
or administrative action, suit, demand, claim, hearing, notice, or demand
letter, notice or violation, investigation, or proceeding pending or, to the
Borrower's knowledge, threatened, against the Borrower or any of its
Subsidiaries relating in any way to Environmental Laws.
(o) MONARCH ACQUISITION AGREEMENT. The closing of the transactions
contemplated by the Monarch Acquisition Agreement shall occur after the
making of the Term Loans, and the Borrower has not waived or in any way
amended, without the prior written consent of the Agent, any condition to the
obligations of the Borrower to consummate the transactions contemplated under
the Monarch Acquisition Agreement. A true and complete copy of the Monarch
Acquisition Agreement (including all exhibits, schedules and amendments
thereto) has been delivered to the Agent. The Borrower is not in default
under any of the Monarch Acquisition Agreement or under any instrument or
document to be delivered in connection therewith. The representations and
warranties made in the Monarch Acquisition Agreements by the Borrower and, to
the best knowledge of the Borrower, by the sellers thereunder, are true and
correct in all material respects on and as of the Effective Date as though
made on and as of such date.
(p) SENIOR MANAGEMENT EMPLOYMENT AGREEMENTS. Borrower has entered into
employment agreements with Messrs. Pincourt, Maltby, Xxxxxx and Xxxxxxxx for
terms of not less than five (5) years from July 15, 1999, true and complete
copies of which have been delivered to the Agent.
(q) TRADEMARKS. The tradenames and trademarks listed on Schedule
6.01(q) attached hereto are all of the tradenames and trademarks included in
the computation of Borrower's Tangible Net Worth. The current valuations of
such tradenames and trademarks used in calculating Borrower's Tangible Net
Worth are shown on Schedule 6.01(q).
(r) OWNERSHIP OF SUBSIDIARIES AND COLLATERAL. Borrower is the owner of
one hundred percent (100%) of all shares of voting stock of each of the
Subsidiaries except as shown on Schedule 6.01(b), the Collateral issued by
each of the Subsidiaries is shown on the books of that Subsidiary as being
owned by the Borrower and that there are no restrictions on the granting to
the Agent by the Borrower of a security interest in the Collateral as set
forth in the Pledge Agreement.
SECTION 6.02. SURVIVAL OF REPRESENTATIONS AND WARRANTIES, ETC. All
statements contained in any certificate, financial statement or other
instrument delivered by or on behalf of Borrower to Agent or any Lender
pursuant to or in connection with this Agreement or any of the other Loan
Documents (including, but not limited to, any such statement made in or in
connection with any amendment thereto or any statement contained in any
certificate, financial statement or other instrument delivered by or on
38
behalf of Borrower prior to the date hereof and delivered to Agent or such
Lender in connection with the closing the transactions contemplated hereby)
shall constitute representations and warranties made by the Borrower under
this Agreement. All representations and warranties made under this Agreement
shall be deemed to be made at and as of the Agreement Date, the Effective
Date, the date of making each Loan, the date of each Continuation or
Conversion thereof and the Date of Issuance of each Letter of Credit, except
to the extent that such representations and warranties expressly relate
solely to an earlier date (in which case such representations and warranties
shall have been true and accurate on and as of such earlier date).
ARTICLE VII
AFFIRMATIVE COVENANTS
For so long as any of the Obligations remain unpaid or unperformed, or
this Agreement is in effect, unless the Lenders shall otherwise consent in
the manner provided for in Section 13.07, the Borrower will and will cause
each of its Subsidiaries to:
SECTION 7.01. PRESERVATION OF EXISTENCE AND SIMILAR MATTERS. Preserve
and maintain its respective existence, rights, franchises, licenses and
privileges in the jurisdiction of its formation and qualify and remain
qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification or authorization and the failure to be so qualified or
authorized could have a Material Adverse Effect on the Borrower or such
Subsidiary.
SECTION 7.02. COMPLIANCE WITH APPLICABLE LAW. Comply with all
Applicable Law (including, without limitation, all Environmental Laws) as the
same may be amended from time to time, and obtain all Governmental Approvals
required by the Borrower or any of its Subsidiaries to be so obtained, except
where such noncompliance would not have a Material Adverse Effect on Borrower
or where the Borrower or such Subsidiary is challenging in good faith by
appropriate proceedings (diligently pursued) the application or enforcement
of such Applicable Law or requirement for such Governmental Approval and
against which adequate reserves have been established in accordance with GAAP.
SECTION 7.03. MAINTENANCE OF PROPERTY. In addition to, and not in
derogation of, the requirements of any of the other Loan Documents, (a)
protect and preserve all of its properties, including, but not limited to,
copyrights, patents, trade names and trademarks, and maintain in good repair,
working order and condition all tangible properties, and (b) from time to
time make or cause to be made all needed and appropriate repairs, renewals
and replacements to such properties, so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times.
SECTION 7.04. CONDUCT OF BUSINESS. At all times carry on its business
in the same fields as disclosed in Borrower's 10K filing with the SEC for the
fiscal year ended September 30, 1998. Neither Borrower nor any of its
Subsidiaries shall enter into any field of business not otherwise engaged in
as of the date hereof.
SECTION 7.05. INSURANCE. Maintain at all times with such insurance
companies as shall be reasonably satisfactory to the Agent, with all premiums
thereon to be paid, insurance with respect to its properties and business
against such casualties and contingencies (including but not limited to
public liability and business interruption) and in such amounts as is
customary in the case of similarly situated
39
corporations engaged in the same or similar businesses and are consistent
with Borrower's current insurance practices as of the Effective Date. From
time to time deliver to the Agent upon its request a detailed list, together
with copies of all policies of the insurance then in effect, stating the
names of the insurance companies, the amounts and rates of the insurance, the
dates of the expiration thereof and the properties and risks covered thereby.
SECTION 7.06. PAYMENT OF TAXES AND CLAIMS. Pay or discharge when due
(a) all taxes, assessments and governmental charges or levies imposed upon it
or upon its income or profits or upon any properties belonging to it, and (b)
all lawful claims of materialmen, mechanics, carriers, warehousemen and
landlords for labor, materials, supplies and rentals which, if unpaid, might
become a material Lien on any of its properties or which would otherwise
materially adversely affect the value of any Collateral; PROVIDED, HOWEVER,
that this Section shall not require the payment or discharge of any such tax,
assessment, charge, levy or claim which is being contested in good faith by
appropriate proceedings which operate to suspend the collection thereof and
for which adequate cash reserves have been established in an amount in
accordance with GAAP; PROVIDED, FURTHER, HOWEVER, neither the Borrower nor
any of its Subsidiaries may contest any such tax, assessment, charge, levy or
claim if the contest thereof will impair the value or marketability of any
Collateral or the Agent's Security Interest therein.
SECTION 7.07. VISITS AND INSPECTIONS. Permit representatives or agents
of Agent or any Lender, from time to time, as often as may be reasonably
requested and reasonably necessary for monitoring of the Loans, but only
during normal business hours, at the expense of the Borrower, to: (a) visit
and inspect the properties (including Collateral inspections to occur not
more than four times annually) of the Borrower and its Subsidiaries; (b)
inspect and make extracts from relevant books and records of the Borrower and
its Subsidiaries, including but not limited to management letters prepared by
independent accountants; (c) discuss with principal officers, and independent
accountants of the Borrower and its Subsidiaries, the business, assets,
liabilities, financial conditions, results of operations and business
prospects of the Borrower and its Subsidiaries; and (d) conduct an audit of
the Collateral.
SECTION 7.08. USE OF PROCEEDS. (a) Use the proceeds of all Revolving
Loans to finance its working capital requirements and for general corporate
purposes only; (b) use the proceeds of the Term Loans to pay the purchase
price for the acquisition of Monarch and transaction expenses incidental
thereto; (c) to repay all amounts due pursuant to the Senior Notes; and (d)
not use any part of the proceeds of the Revolving Loans to purchase or carry,
or to reduce or retire or refinance any credit incurred to purchase or carry,
any margin stock (within the meaning of Regulations U and X of the Board of
Governors of the Federal Reserve System) or to extend credit to others for
the purpose of purchasing or carrying any margin stock.
SECTION 7.09. INTEREST RATE PROTECTION. Within 60 days after the
Agreement Date, Borrower shall provide Agent with written evidence in form
and substance acceptable to the Required Lenders that Borrower has entered
into an agreement with a financial institution having a Standard & Poors
credit rating of "A" or better protecting Borrower against risks of increases
in interest rates.
SECTION 7.10. SUBSIDIARY SECURITIES REGISTRATION. If any Subsidiary
shall become registered and traded in any nationally recognized stock
exchange, Borrower shall cause each Subsidiary to promptly and completely
file all reports required to be filed under the 1934 Act, such that all
current public information as defined in Rule 144 is available and at the
request of the Agent, each Subsidiary will, if applicable, use its best
efforts to cooperate in good faith with the Agent to release any restrictions
40
on the stock certificates for the Collateral as and when permitted under the
1933 Act. At Agent's request, Borrower shall cause each Subsidiary, at its
expense, to file whatever forms, statements or documents which are necessary
with the SEC and other regulatory agencies so that any legend and/or other
restrictions associated with the Collateral may be cleared or released as
soon as possible.
ARTICLE VIII
INFORMATION
For so long as any of the Obligations remains unpaid or unperformed, or
this Agreement is in effect, unless the Lenders shall otherwise consent in
the manner set forth in Section 13.07, the Borrower will furnish to the Agent
and each Lender at its Lending Office:
SECTION 8.01. QUARTERLY REPORTS. Within forty-five (45) days after the
close of each quarterly accounting period of the Borrower, except Borrower's
fiscal year end, a copy of Form 10Q as filed by Borrower with the SEC for
such period. In the event Borrower does not file a Form 10Q with the SEC
within forty-five (45) days after the close of each quarterly accounting
period of Borrower, Borrower shall, within such forty-five (45) day period,
deliver the consolidated balance sheet of the Borrower and its Subsidiaries
as at the end of such period and the related consolidated statement of income
of the Borrower and its Subsidiaries for such period, setting forth in
comparative form the figures as at the end of and for the corresponding
fiscal quarter of the prior fiscal year, all of which shall be certified by
an Authorized Representative of Borrower of Borrower to present fairly in all
material respects, in accordance with GAAP consistently applied (subject to
changes resulting from normal year-end adjustments), the consolidated
financial position of the Borrower and its Subsidiaries as at the date
thereof and the results of operations for such period. With each such report
Borrower shall submit to the Agent a fully completed compliance certificate
in the form attached hereto as Exhibit "K" duly certified in form and
substance acceptable to Agent by an Authorized Representative of Borrower.
SECTION 8.02. YEAR-END STATEMENTS. Within one hundred twenty (120) days
after the end of each fiscal year of the Borrower, a copy of Form 10K as
filed by Borrower with the SEC. In the event Borrower does not file a Form
10K with the SEC within one hundred twenty (120) days after the close of each
fiscal year of Borrower, Borrower shall, within such one hundred twenty (120)
day period, deliver the consolidated balance sheet of the Borrower as at the
end of such fiscal year and the related consolidated statements of income and
cash flows of the Borrower and its Subsidiaries for such fiscal year, setting
forth in comparative form the figures as at the end of and for the previous
fiscal year, all of which shall be certified by an Authorized Representative
of Borrower to present fairly in all material respects, in accordance with
GAAP consistently applied, the consolidated financial position of the
Borrower and its Subsidiaries as at the date thereof and the consolidated
results of operations for such period, and also shall be certified by
McGladrey & Xxxxxx, LLP or such other independent certified public
accountants of recognized national standing proposed by Borrower and
otherwise reasonably acceptable to the Lenders, whose certificate shall be in
scope and substance satisfactory to the Lenders and who shall have authorized
the Borrower to deliver such financial statements and certification thereof
to the Agent and the Lenders pursuant to this Agreement. Together with each
delivery of the annual financial statements required above, Borrower shall
deliver to the Agent and each Lender a letter from the Borrower's accountants
stating that in performing the audit necessary to render an opinion on the
financial statements delivered under this Section 8.02, they obtained no
knowledge of any Default or Event of Default by the Borrower in the
fulfillment of the terms and provisions of this Agreement insofar as they
related to financial matters (which at the date of such statement remains
uncured), or if the
41
accountants have obtained knowledge of such Default or Event of Default, a
statement specifying the nature and period of existence thereof. Within
ninety (90) days after the beginning of each fiscal year of Borrower,
Borrower shall deliver to Agent, in form and substance reasonably acceptable
to Agent, a report of the projected financial performance of Borrower and its
Subsidiaries for that fiscal year on a consolidated basis.
SECTION 8.03. BORROWING BASE CERTIFICATE. Not later than 5:00 p.m. EST
on the twenty-fifth (25th) day of each calendar month (or more frequently, if
requested by the Agent), a duly completed Borrowing Base Certificate, with
respect to the immediately prior month period, certified by an Authorized
Representative of Borrower.
SECTION 8.04. COPIES OF OTHER REPORTS.
(a) Promptly upon receipt thereof, copies of all reports, if any,
submitted to the Borrower by the Borrower's independent public accountants
including any management report; and
(b) From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel, documents or further
information regarding the business, assets, liabilities, financial condition,
results of operations or business prospects of the Borrower and its
Subsidiaries as any Lender or the Agent may reasonably request. The rights
of the Lenders and the Agent under this Section are in addition to and not in
derogation of their rights under any other provision of this Agreement or any
of the other Loan Documents.
SECTION 8.05. NOTICE OF LITIGATION AND OTHER MATTERS. Prompt notice of:
(a) the commencement of all proceedings and investigations by or before
any governmental or nongovernmental body and all actions and proceedings in
any court or other tribunal or before any arbitrator against or in any other
way relating adversely to, or adversely affecting, the Borrower or any
Subsidiary or any of their respective properties, assets or businesses which,
if adversely determined or resolved, could have a Material Adverse Effect on
the Borrower or any Subsidiary, as applicable, including without limitation,
any claim, action, demand, suit, proceeding, hearing, study, or
investigation, based on or related to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling or
the emission, discharge, release or threatened release into the environment,
of any pollutant, contaminant (chemical or industrial), toxic, or other
Hazardous Material;
(b) any change in the Senior Management of the Borrower unless within
one hundred twenty (120) days the senior manager is replaced by a manager of
comparable experience and ability as determined in the reasonable judgment of
the Required Lenders and any change in the business, assets, liabilities,
financial condition, results of operations or business prospects of the
Borrower or any Subsidiary which has had or may have a Material Adverse
Effect on the business operations of the Borrower or any Subsidiary, as
applicable; and
(c) any Default or Event of Default or any event which constitutes or
which with the passage of time, the giving of notice, a determination of
materiality, the satisfaction of any condition or any combination of any of
the foregoing would constitute a default or event of default by the Borrower
or any Subsidiary under any material agreement (other than this Agreement) to
which the Borrower or any Subsidiary is a party or by which the Borrower or
any Subsidiary or any of its respective properties may
42
be bound and such action that the Borrower or such Subsidiary is taking to
remedy such Default, Event of Default or event.
SECTION 8.06. ERISA. As soon as possible and in any event within 30 days
after the Borrower knows, or has reason to know, that:
(a) any Termination Event with respect to a Plan has occurred or will
occur; or
(b) the existence of any Unfunded Vested Accrued Benefits under all Plans;
or
(c) the Borrower or any Affiliate is in "default" (as defined in
Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan
required by reason of its complete or partial withdrawal (as described in
Section 4203 or 4205 of ERISA) from such Plan,
a certificate of the President or Chief Executive Officer of the Borrower
setting forth the details of such of the events described in clauses (a) through
(c) as applicable and the action which is proposed to be taken with respect
thereto, together with any notice or filing which may be required by the PBGC or
other agency of the United States government with respect to such of the events
described in clauses (a) through (c) as applicable.
ARTICLE IX
NEGATIVE COVENANTS
So long as any of the Obligations remains unpaid or unperformed, or
this Agreement is in effect, unless the Lenders shall otherwise consent in
the manner set forth in Section 13.07, the Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly:
SECTION 9.01. INDEBTEDNESS FOR BORROWED MONEY. Create, assume, or
otherwise become or remain obligated in respect of, or permit or suffer to
exist or to be created, assumed or incurred or to be outstanding any
Indebtedness for Money Borrowed, except that this Section shall not apply to
(a) Indebtedness for Money Borrowed represented by the Loans and the Notes,
(b) the Indebtedness set forth on Schedule 6.01(g), (c) reasonable and
customary business expenses incurred in the ordinary course of Borrower's or
its Subsidiaries' businesses and trade debt incurred in the ordinary course
of business, (d) Indebtedness secured by Permitted Liens, and (e)
intracompany Indebtedness between the Borrower and any of its Subsidiaries or
between Subsidiaries which do not, in the aggregate for all Subsidiaries,
exceed Two Million and No/100 Dollars ($2,000,000.00) at any one time and
which are made in the ordinary course of Borrower's and the Subsidiaries'
businesses as currently conducted or has otherwise been approved by the
Required Lenders; PROVIDED, HOWEVER, that such Indebtedness described in
subparagraph (b) that is owing by the Borrower or any of its Subsidiaries to
an Affiliate thereof shall be subordinated to the Obligations on terms and
conditions satisfactory to the Agent in its sole discretion.
SECTION 9.02. GUARANTIES. Become or remain liable on or under any
Guaranty, except for any Guaranty in existence on the date hereof and set
forth on Schedule 6.01(g).
SECTION 9.03. INVESTMENTS. Acquire any Person or any Business Unit of any
Person or make or purchase any investment or permit any investment to be
outstanding other than investments in
43
existence as of the date hereof, acquisition of the assets of Monarch
pursuant to the Monarch Acquisition Agreement and those permitted under
Section 9.08, 9.10 and 9.11.
SECTION 9.04. LIENS. Create, assume, incur or permit or suffer to exist
or to be created, assumed or incurred, any Lien upon any of its properties or
assets of any character whether now owned or hereafter acquired other than
Permitted Liens or to enter into an agreement with any Person restricting or
prohibiting the creation of liens or other encumbrances on the property of
Borrower or any Subsidiary.
SECTION 9.05. RESTRICTED DISTRIBUTIONS AND PURCHASES. Declare or make any
Restricted Distribution or Restricted Purchase.
SECTION 9.06. MERGER, CONSOLIDATION AND OTHER ARRANGEMENTS. Merge or
consolidate with any other Person, acquire any other Person or liquidate or
dissolve or wind-up its respective affairs, or enter into any partnerships,
joint ventures or sale-leaseback transactions or purchase or otherwise acquire
(in one or a series of related transactions) any part of the property or assets
(other than purchases or other acquisitions of inventory, materials and
equipment in the ordinary course of business) of any Person.
SECTION 9.07. PLANS. Take any action which would cause any Unfunded
Vested Accrued Benefits under any Plan of the Borrower and its Affiliates to
exist.
SECTION 9.08. LOANS. Extend credit to, or make any advance, loan or
contribution of money or goods to, any Person other than salary and travel
advances outstanding to employees of the Borrower and its Subsidiaries,
consistent with the past practices of the Borrower and its Subsidiaries, in an
aggregate amount at any time outstanding not to exceed $500,000 and extensions
of loans to Subsidiaries disclosed on Schedule 6.01(g) on terms approved by the
Agent in its reasonable judgment.
SECTION 9.09. SUBSIDIARIES. Incorporate, create or acquire any
Subsidiary.
SECTION 9.10. TRANSACTIONS WITH AFFILIATES. Enter into any transaction or
series of transactions, whether or not related or in the ordinary course of
business, with any other Affiliate of the Borrower or such Subsidiary, other
than on terms and conditions substantially as favorable to the Borrower or such
Subsidiary as would be obtainable by the Borrower or such Subsidiary at the time
in a comparable arm's-length transaction with a Person not an Affiliate
PROVIDED, HOWEVER, that this Section 9.10 shall not prohibit any transaction
solely among the Borrower and its current Subsidiaries shown on Schedule 6.01(b)
provided such transactions are within the ordinary course of Borrower's business
as currently conducted.
SECTION 9.11. NO SALE OF ASSETS. Sell, lease, assign, transfer or
otherwise dispose of any assets whether in one or a series of transactions
(whether or not related) other than: (a) Inventory in the ordinary course of
business; (b) obsolete or worn out property disposed of in the ordinary course
of business; (c) the disposition by Xxxxxxxxx Bahamas, Limited of its assets
located in the Bahamas, provided the net proceeds of such assets shall be
retained by Borrower or a Subsidiary; and (d) other dispositions of assets;
PROVIDED that: (x) such other dispositions are for fair value; (y) the aggregate
consideration (whether in the form of cash, promissory notes or other
instruments) for such other dispositions does not exceed $500,000 in the
aggregate for any fiscal year; and (z) such consideration is reinvested in the
business of the Borrower.
44
SECTION 9.12. CHANGE IN ACCOUNTING METHOD OR FISCAL YEAR END. Make any
change in accounting treatment and reporting practices except as required by
GAAP, or change its fiscal year end.
SECTION 9.13. CHANGE OF SENIOR MANAGEMENT OR CONTROL. Allow any change in
Senior Management unless within one hundred twenty (120) days the senior manager
is replaced by a manager of comparable experience and ability as determined in
the reasonable judgment of the Required Lenders or a change in Control.
SECTION 9.14. CHANGE IN ORGANIZATIONAL DOCUMENTS. Make any change in the
articles of incorporation, bylaws or other organizational documents affecting
the governance of Borrower or any Subsidiary, including, without limitation, any
provision affecting any voting rights or percentages for approval of any
corporate action.
SECTION 9.15. ADDITIONAL SUBSIDIARIES EQUITIES. Allow any Subsidiary to
issue any additional shares of common stock or other evidence of equity
ownership whether privately or to the public or by way of stock dividend, stock
split or stock sale.
ARTICLE X
FINANCIAL COVENANTS
So long as any of the Obligations remain unpaid or unperformed or this
Agreement is in effect, unless the Lenders shall otherwise consent in the manner
set forth in Section 13.07, the Borrower and all Subsidiaries shall, on a
consolidated basis:
SECTION 10.01. MINIMUM TANGIBLE NET WORTH. Maintain a Tangible Net Worth
as of the last day of each fiscal quarter of Borrower of not less than
$28,000,000 for each fiscal quarter of Borrower ending after March 31, 2000
through September 30, 2000, and thereafter Tangible Net Worth shall be a minimum
of $28,000,000, plus 50% of the annual net income (but not loss) of the Borrower
and its Subsidiaries for the prior fiscal year of Borrower (on a consolidated
basis in accordance with GAAP) and on or prior to the date of determination,
plus 75% of the net proceeds of any equity or subordinated debt offering
completed by Borrower after the Agreement Date.
SECTION 10.02. INTEREST COVERAGE RATIO. Maintain the ratio of EBITDA to
Consolidated Interest Expense determined at the end of each fiscal quarter of
Borrower for the four consecutive fiscal quarters then ended at least as
follows:
3.0 to 1.0 between 3/31/00 and 9/30/01
4.0 to 1.0 between 12/31/01 and 9/30/03
5.0 to 1.0 thereafter
SECTION 10.03. FIXED CHARGE COVERAGE. Maintain, at all times after March
31, 2000, a Fixed Charge Coverage Ratio of not less than 1.5 to 1.0 which shall
be tested at each fiscal quarter end of Borrower for the four consecutive
quarters then ended.
SECTION 10.04. FUNDED DEBT RATIO. Maintain, at all times Funded Debt of
not greater than sixty-five percent (65%) of the sum of Funded Debt plus
Tangible Net Worth as of the end of each of the
45
four fiscal quarters in Borrower's fiscal year 2000 (beginning March 31,
2000), not greater than sixty percent (60%) for fiscal quarters ended in
Borrower's fiscal year 2001, not greater than fifty-five percent (55%) for
fiscal quarters ended in Borrower's fiscal year 2002, and not greater than
fifty percent (50%) for each fiscal quarter ended thereafter.
SECTION 10.05. FUNDED DEBT TO EBITDA. Maintain a ratio of Funded Debt to
EBITDA of not more than 3.75:1 as of the end of any fiscal quarter of Borrower
after March 31, 2000 during the fiscal year of Borrower ending September 30,
2000, 3.00:1 as of the end of any fiscal quarter of Borrower during the fiscal
year of Borrower ending September 30, 2001, and 2.50:1 as of the end of any
fiscal quarter of Borrower at all times thereafter. Such ratio shall be
measured on the basis of the financial results of Borrower for the most recent
four (4) fiscal quarters of Borrower ending on the dates of measurement.
ARTICLE XI
DEFAULT
SECTION 11.01. EVENTS OF DEFAULT. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority or nongovernmental body:
(a) DEFAULT IN PAYMENT. The Borrower shall fail to pay when due (whether
upon demand, at maturity, by reason of acceleration or otherwise) the principal
of, or interest on, any of the Loans or Notes, or any amount payable hereunder
when and as required to be made pursuant to any Reimbursement Obligation, or
shall fail to pay when due any of the other obligations owing by the Borrower
under this Agreement or any other Loan Document within ten (10) days after the
date due.
(b) MISREPRESENTATIONS. Any statement, representation or warranty made or
deemed made by or on behalf of the Borrower under this Agreement or under any
other Loan Document, or any amendment hereto or thereto, or in any other
statement at any time furnished or made or deemed made by or on behalf of the
Borrower to the Agent or any Lender in connection with any Loan Document or with
respect to the transactions contemplated by the Loan Documents, shall at any
time prove to have been incorrect or misleading in any material respect when
furnished or made or deemed made.
(c) DEFAULT IN PERFORMANCE. (i) The Borrower shall fail to perform or
observe any term, covenant, condition or agreement contained in Article IX or
Article X and such failure shall continue for thirty (30) days, or (ii) the
Borrower shall fail to perform or observe any term, covenant, condition or
agreement contained in this Agreement or any other Loan Document to which it is
a party and not otherwise mentioned in this Section 11.01 and such failure shall
continue for a period of thirty days.
(d) VOLUNTARY BANKRUPTCY PROCEEDING. The Borrower or any Subsidiary
shall: (i) commence a voluntary case under the federal bankruptcy laws (as now
or hereafter in effect); (ii) file a petition seeking to take advantage of any
other laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or adjustment of debts; (iii) consent to or fail to
contest in a timely and appropriate manner any petition filed against it in an
involuntary case under such bankruptcy laws or other laws; (iv) apply for or
consent to or fail to contest in a timely and appropriate manner, the
46
appointment of, or the taking of possession by, a receiver, custodian, trustee,
or liquidator of itself or of a substantial part of its property, domestic or
foreign; (v) admit in writing its inability to pay its debts as they become due;
(vi) make a general assignment for the benefit of creditors; (vii) make a
conveyance fraudulent as to creditors under any state or federal law; or (viii)
take any corporate or partnership action for the purpose of effecting any of the
foregoing.
(e) INVOLUNTARY BANKRUPTCY PROCEEDING. A case or other proceeding shall
be commenced against the Borrower or any Subsidiary in any court of competent
jurisdiction seeking and not dismissed within sixty (60) days after the date of
filing: (i) relief under the federal bankruptcy laws (as now or hereafter in
effect) or under any other laws, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, winding up or adjustment of debts; or (ii) the
appointment of a trustee, receiver, custodian, liquidator or the like for such
Person or all or any substantial part of its assets, domestic or foreign.
(f) LITIGATION. The Borrower shall challenge or contest in any action,
suit or proceeding in any court or before any arbitrator or governmental body
the validity or enforceability of this Agreement, any Note or any other Loan
Document.
(g) JUDGMENT. A judgment or order for the payment of money individually
or in the aggregate equal to or greater than $250,000 shall be entered against
the Borrower or any Subsidiary by any court and such judgment or order shall
continue undischarged, unstayed and unbonded for thirty (30) days after filing.
(h) ATTACHMENT. A warrant or writ of attachment or execution or similar
process shall be issued against any property of the Borrower or any Subsidiary
for an amount equal to or greater than $250,000 which shall continue
undischarged and unbonded for a period of thirty (30) days.
(i) ERISA. (i) Any Termination Event with respect to a Plan shall occur
and continue uncured for a period of ninety (90) days after occurrence if
curable; (ii) any Plan shall incur an "accumulated funding deficiency" (as
defined in Section 412 of the Internal Revenue Code or Section 302 of ERISA) for
which a waiver has not been obtained in accordance with the applicable
provisions of the Internal Revenue Code and ERISA; or (iii) the Borrower is in
"default" (as defined in Section 4219(c)(5) of ERISA) with respect to payments
to a Multiemployer Plan resulting from the Borrower's complete or partial
withdrawal (as described in Section 4203 or 4205 of ERISA) from such
Multiemployer Plan.
(j) CROSS DEFAULT. Borrower or any Subsidiary defaults (whether as
primary obligor or as guarantor or other surety) in any payment of principal of
or interest on any other obligation for Money Borrowed (or any Capitalized Lease
Obligation, any obligation under a conditional sale or other title retention
agreement, any obligation issued or assumed as full or partial payment for
property whether or not secured by a purchase money mortgage or any obligation
under notes payable or drafts accepted representing extensions of credit) beyond
any period of grace provided with respect thereto; or Borrower or any Subsidiary
fails to perform or observe any other agreement, term or condition contained in
any agreement under which any such obligation is created (or if any other event
thereunder or under any such agreement shall occur and be continuing) and the
effect of such failure or other event is to cause, or to permit the holder or
holders of such obligation (or a trustee on behalf of such holder or holders) to
cause, such obligation to become due (or to be repurchased or defeased by
Borrower or any Subsidiary) prior to its stated maturity.
47
(k) MATERIAL ADVERSE EFFECT. Any change shall have occurred in the
business, assets, liabilities, financial condition, results of operations or
business prospects of the Borrower or any of its Subsidiaries which has had or
may have a Material Adverse Effect on the Borrower and its Subsidiaries, taken
as a whole.
(l) SECURITY INTEREST. The Security Interest shall for any reason cease
to be a valid, enforceable, perfected and first-priority Lien on any of the
Collateral, subject only to Permitted Liens.
SECTION 11.02. REMEDIES. Upon the occurrence of an Event of Default the
following provisions shall apply:
(a) ACCELERATION; TERMINATION OF FACILITIES.
(i) AUTOMATIC. Upon the occurrence of an Event of Default specified
in Sections 11.01(d) or (e), then (A)(1) the principal of, and the interest on,
the Loans and the Notes at the time outstanding, (2) an amount equal to the
Stated Amount of all Letters of Credit outstanding as of the date of the
occurrence of the Event of Default and (3) all of the other obligations of the
Borrower hereunder, including, but not limited to, the other amounts owed to the
Lenders and the Agent under this Agreement, the Notes or any of the other Loan
Documents, and all other Obligations, shall become automatically due and payable
by the Borrower without presentment, demand, protest, or other notice of any
kind, all of which are expressly waived by the Borrower and (B) the Revolving
Credit Facility and the Letter of Credit Facility, the obligations of the
Lenders to make Revolving Loans under the Revolving Credit Facility, the
obligation of the Letter of Credit Issuer to issue Letters of Credit under the
Letter of Credit Facility and each Lender's respective Commitment shall
immediately and automatically terminate.
(ii) OPTIONAL. If any other Event of Default shall have occurred and
be continuing (other than an Event of Default specified in Section 11.01(d) or
(e)), then (xx) the Agent, at the direction of the Required Lenders, shall:
(A) declare (1) the principal of, and interest on, the Loans and the Notes at
the time outstanding, (2) an amount equal to the Stated Amount of all Letters of
Credit outstanding as of the date of the occurrence of the Event of Default and
(3) all of the other obligations of the Borrower hereunder, including, but not
limited to, the other amounts owed to the Lenders and the Agent under this
Agreement, the Notes or any of the other Loan Documents, and all other
Obligations, to be forthwith due and payable, whereupon the same shall
immediately become due and payable without presentment, demand, protest or other
notice of any kind, all of which are expressly waived by the Borrower and
(B) terminate each Lender's respective Commitment, the Revolving Credit Facility
and the Letter of Credit Facility, the obligation of the Lenders to make
Revolving Loans under the Revolving Credit Facility and the obligation of the
Letter of Credit Issuer to issue Letters of Credit under the Letter of Credit
Facility.
(b) LOAN DOCUMENTS. The Agent, upon the direction of the Required
Lenders, shall exercise any and all of its rights under any and all of the other
Loan Documents.
(c) CASH COLLATERAL. The Agent, upon the direction and at the election of
the Required Lenders, may require the Borrower to deposit into the Cash
Collateral Account the amounts specified in Sections 11.02(a)(i)(A)(2) or
11.02(a)(ii)(A)(2), as applicable. The monies so deposited therein shall be
used in the manner specified in Section 3.07 hereof as if the Facility
Termination Date were the date the applicable Event of Default had occurred.
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SECTION 11.03. RIGHTS CUMULATIVE. The rights and remedies of the Agent and
the Lenders under this Agreement, the Notes and each of the other Loan Documents
shall be cumulative and not exclusive of any rights or remedies which it would
otherwise have under Applicable Law. In exercising its rights and remedies the
Agent and the Lenders may be selective and no failure or delay by the Agent or
any of the Lenders in exercising any right shall operate as a waiver of it, nor
shall any single or partial exercise of any power or right preclude its other or
further exercise or the exercise of any other power or right.
ARTICLE XII
THE AGENT
SECTION 12.01. AUTHORIZATION AND ACTION. Each Lender hereby appoints and
authorizes the Agent to take such action as Agent on such Lender's behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to Agent by the terms hereof and thereof, together with such powers as
are reasonably incidental thereto. The power of attorney set forth herein shall
be irrevocable and coupled with an interest. The relationship between Agent and
the Lenders shall be that of principal and agent only and nothing herein shall
be construed to deem Agent a trustee for any Lender nor to impose on Agent
duties or obligations other than those expressly provided for herein. At the
request of a Lender, the Agent will forward to each Lender copies or, where
appropriate, originals of the documents delivered to the Agent pursuant to
Section 6.01 hereof. The Agent will also furnish to any Lender, upon the
request of such Lender, a copy of any certificate or notice furnished to the
Agent by the Borrower, or any other Affiliate of the Borrower, pursuant to this
Agreement or any other Loan Document not already delivered to such Lender
pursuant to the terms of this Agreement or any such other Loan Document. As to
any matters not expressly provided for by the Loan Documents (including, without
limitation, enforcement or collection of the Notes), the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required Lenders, and such
instructions shall be binding upon all Lenders and all holders of Notes;
PROVIDED, HOWEVER, that Agent shall not be required to take any action which is
contrary to this Agreement or any other Loan Document or Applicable Law. Not in
limitation of the foregoing, Agent shall not exercise any right or remedy it or
the Lenders may have under any Loan Document upon the occurrence of a Default or
an Event of Default unless the Required Lenders have so directed Agent to
exercise such right or remedy.
SECTION 12.02. AGENT'S RELIANCE, ETC. Neither the Agent nor any
directors, officers, agents, employees or counsel shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement, except for its or their own gross negligence or willful misconduct.
Without limiting the generality of the foregoing, Agent: (a) may treat the payee
of any Note as the holder thereof until such Agent receives written notice of
the assignment or transfer thereof signed by such payee and in form satisfactory
to the Agent; (b) may consult with legal counsel (including counsel for the
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts; (c)
makes no warranty or representation to any Lender and shall not be responsible
to any Lender for any statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document including, without
limitation, any Borrowing Base Certificate; (d) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of any of this Agreement or any other Loan Document or
the
49
satisfaction of any conditions precedent under this Agreement or any Loan
Document on the part of any or all of the Borrower or other Persons or
inspect the property, books or records of any or all of the Borrower or any
other Person; (e) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other Loan Document, any other instrument or
document furnished pursuant thereto or any collateral covered thereby or the
perfection or priority of any Lien in favor of any Agent on behalf of the
Lenders in any such collateral; and (f) shall incur no liability under or in
respect of this Agreement or any other Loan Document by acting upon any
notice, consent, certificate or other instrument or writing (which may be by
telephone or telecopy) believed by it to be genuine and signed, sent or given
by the proper party or parties.
SECTION 12.03. AGENT AS LENDER. SouthTrust Bank, National Association, as
a Lender, shall have the same rights and powers under this Agreement and any
other Loan Document as any other Lender and may exercise the same as though it
were not the Agent; and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated, include the Agent in its individual capacity. The Agent
and its Affiliates may each accept deposits from, maintain deposits or credit
balances for, invest in, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with the Borrower, or any other
Affiliate thereof as if it were any other bank and without any duty to account
therefor to the other Lenders.
SECTION 12.04. LENDER CREDIT DECISION, ETC. Each Lender expressly
acknowledges that neither the Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or other Affiliates has made any
representations or warranties to such Lender and that no act by Agent
hereinafter taken, including any review of the affairs of the Borrower, shall be
deemed to constitute any representation or warranty by Agent to any Lender.
Each Lender acknowledges that it has, independently and without reliance upon
Agent, any other Lender or counsel to Agent, and based on the financial
statements of the Borrower and its Affiliates, its review of the Loan Documents,
the legal opinions required to be delivered to it hereunder, the advice of its
own counsel and such other documents and information as it has deemed
appropriate, made its own credit and legal analysis and decision to enter into
this Agreement and the transaction contemplated hereby. Each Lender also
acknowledges that it will, independently and without reliance upon the Agent,
any other Lender or counsel to the Agent, and based on such review, advice,
documents and information as it shall deem appropriate at the time, continue to
make its own decisions in taking or not taking action under the Loan Documents.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by Agent hereunder, Agent shall have no duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower or any other Affiliate thereof which may come
into possession of Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or other Affiliates.
SECTION 12.05. INDEMNIFICATION. The Lenders agree to indemnify Agent (to
the extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so) PRO RATA in accordance with the Lenders' respective
Credit Percentages, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may at any time be imposed
on, incurred by, or asserted against Agent in any way relating to or arising out
of the Loan Documents or any action taken or omitted by Agent under the Loan
Documents; PROVIDED, HOWEVER, that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements to the extent resulting from Agent's
gross negligence or willful misconduct or if Agent
50
fails to follow the written direction of the Lenders unless such failure is
pursuant to the advice of counsel of which the Lenders have received notice.
Without limiting the generality of the foregoing, each Lender agrees to
reimburse Agent promptly upon demand for its ratable share of any reasonable
out-of-pocket expenses (including reasonable counsel fees) incurred by Agent
in connection with the preparation, execution, administration, or enforcement
of, or legal advice with respect to the rights or responsibilities of the
parties under, the Loan Documents, to the extent that Agent is not reimbursed
for such expenses by the Borrower. The agreements in this Section shall
survive the payment of the Loans and all other amounts payable hereunder or
under the other Loan Documents and the termination of this Agreement.
SECTION 12.06. COLLATERAL MATTERS.
(a) Each Lender authorizes and directs the Agent to enter into the Loan
Documents for the benefit of the Lenders. Each Lender hereby agrees that,
except as otherwise set forth herein, any action taken by the Lenders in
accordance with the provisions of this Agreement or the Loan Documents, and the
exercise by the Lenders of the powers set forth herein or therein, together with
such other powers as are reasonably incidental thereto, shall be authorized and
binding upon all of the Lenders. Except as otherwise required by Section 13.07,
the Agent is hereby authorized on behalf of all of the Lenders, without the
necessity of any notice to or further consent from any Lender, from time to time
prior to an Event of Default, to take any action with respect to any Loan
Documents including any action which may be necessary or desirable to maintain,
perfect or realize on the Security Interest granted in the Collateral.
(b) The Lenders hereby authorize the Agent, at its option and in its
discretion, to release any Lien hereafter granted to or held by the Agent upon
any Collateral owned by Borrower or its Subsidiaries (i) upon termination of the
Commitments and payment and satisfaction of all of the Obligations at any time
arising under or in respect of this Agreement or the Loan Documents or the
transactions contemplated hereby or thereby or (ii) constituting property being
sold or disposed of upon receipt of the proceeds of such sale by the Agent if
the Borrower certifies to the Agent that the sale or disposition is made in
compliance with Section 9.11 hereof (and the Agent may rely conclusively on any
such certificate, without further inquiry). Upon request by the Agent at any
time, the Lenders will confirm in writing the Agent's authority to release
particular types or items of Collateral pursuant to this Section 12.06.
(c) Upon any sale and transfer of Collateral which is expressly permitted
pursuant to the terms of this Agreement, or consented to in writing by the
Lenders and upon at least five (5) Business Days' prior written request by the
Borrower, the Agent shall (and is hereby irrevocably authorized by the Lenders
to) execute such documents as may be necessary to evidence the release of the
Liens granted to the Agent for the benefit of the Lenders herein or pursuant
hereto upon the Collateral that was sold or transferred; PROVIDED, HOWEVER, that
(i) the Agent shall not be required to execute any such document on terms which,
in the Agent's opinion, would expose the Agent to liability or create any
obligation or entail any consequence other than the release of such Liens
without recourse or warranty and (ii) such release shall not in any manner
discharge, affect or impair the Secured Obligations or any Liens upon (or
obligations of the Borrower or any Subsidiary in respect of) all interests
retained by the Borrower or any Subsidiary, including (without limitation) the
proceeds of the sale, all of which shall continue to constitute part of the
Collateral. In the event of any sale or transfer of Collateral, or any
foreclosure with respect to any of the Collateral, the Agent shall be authorized
to deduct all of the expenses reasonably incurred by the Agent from the proceeds
of any such sale, transfer or foreclosure.
51
(d) The Agent shall have no obligation whatsoever to the Lenders or to any
other Person to assure that the Collateral exists or is owned by the Borrower or
any Subsidiary or is cared for, protected or insured or that the Liens granted
to the Agent herein or pursuant hereto have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any
particular priority, or to exercise or to continue exercising at all or in any
manner or under any duty of care, disclosure or fidelity any of the rights,
authorities and powers granted or available to the Agent in this Section 12.06
or in any of the Loan Documents, it being understood and agreed that in respect
of the Collateral, or any act, omission or event related thereto, the Agent may
act in any manner it may deem appropriate, in its sole discretion, given the
Agent's own interest in the Collateral as one of the Lenders and that the Agent
shall have no duty or liability whatsoever to the Lenders, except in each case
for its gross negligence or willful misconduct.
(e) At any time or times, in order to comply with any legal requirement in
any jurisdiction or in order to facilitate the validity, perfection, priority or
enforceability of the security interests of the Agent in the Collateral, the
Agent may appoint another bank or trust company or one or more Persons, to act
as co-agent or co-agents, jointly with the Agent, or to act as separate agent or
agents on behalf of the Agent and the Lenders with such power and authority as
may be necessary for the effectual operation of the provisions hereof and of the
other Loan Documents and specified in the instrument of appointment.
SECTION 12.07. SUCCESSOR AGENT. Agent may resign at any time in its
capacity as Agent under the Loan Documents by giving written notice thereof to
the Lenders and the Borrower. In the event of a material breach of its duties
hereunder, any Agent may be removed as an Agent under the Loan Documents at any
time by the Required Lenders. Upon any such resignation or removal, the Lenders
shall have the right to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Lenders, and shall have accepted such appointment,
within 30 days after the resigning Agent's giving of notice of resignation or
the Required Lenders' removal of the resigning Agent, then the resigning Agent
may, on behalf of the Lenders, appoint a successor Agent, which shall be a
Lender, if any Lender shall be willing to serve, and otherwise shall be a
commercial bank having combined capital and surplus of at least $1,000,000,000
and reasonably acceptable to the Lenders. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the resigning Agent, and the retiring Agent shall be discharged
from its duties and obligations under the Loan Documents. After any resigning
Agent's resignation or removal hereunder as Agent, the provisions of this
Article XII shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under the Loan Documents.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.01. NOTICES. Unless otherwise provided herein, communications
provided for hereunder shall be in writing and shall be mailed, telecopied or
delivered as follows:
52
If to the Borrower: Xxxxxxxxx International, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxxx, XX 00000
Attn: A. Xxxxxxx Xxxxxxxx, Xx.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to: Xxxxxxx Xxxxxxx Xxxxxx-Xxxxx & Xxxxxxx, P.A.
Xxxxxxxx Point
000 Xxxxx Xxxxxxx Xxxxx
Xxxxx 000 Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
If to any Agent or Lender: To such Person's address or telecopy number,
as applicable, set forth on the then current
Annex I attached hereto.
or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties. All such notices and other
communications shall be effective (i) if mailed, when received; (ii) if
telefacsimile, when transmitted with electronic confirmation of receipt; or
(iii) if hand delivered, when delivered. Notwithstanding the immediately
preceding sentence, all notices or communications to Agent or any Lender under
Articles II and III shall be effective only when actually received.
SECTION 13.02. EXPENSES. The Borrower will pay all reasonable present and
future expenses of the Agent and the Lenders in connection with the following
expenses which shall not include internal expenses of the Agent or any Lender:
(a) the negotiation, preparation, execution, delivery and administration
of this Agreement, the Notes and each of the other Loan Documents, whenever the
same shall be executed and delivered, including appraisers' fees, search fees,
recording fees and the fees and disbursements of: (i) Akerman, Senterfitt &
Xxxxxx, P.A., counsel for the Agent, and (ii) each local and foreign counsel
retained by the Agent;
(b) the negotiation, preparation, execution and delivery of any waiver,
amendment or consent by the Agent or any Lender relating to this Agreement, the
Notes or any of the other Loan Documents;
(c) any restructuring, refinancing or "workout" of the transactions
contemplated by this Agreement, the Notes and the other Loan Documents, or any
material amendment to the terms of this Agreement or any other Loan Document,
including the fees and disbursements of counsel to Agent or any Lender;
(d) consulting on a reasonable basis with one or more Persons engaged by
the Agent, including appraisers, collateral inspectors, accountants and lawyers,
concerning or related to the servicing of this Agreement or the nature, scope or
value of any right or remedy of Agent or any Lender
53
hereunder, under the Notes or under any of the other Loan Documents,
including any review of factual matters in connection therewith, which
expenses shall include the fees and disbursements of such Persons;
(e) the collection or enforcement of the obligations of the Borrower under
this Agreement, the Notes or any other Loan Document including the fees and
disbursements of counsel to the Agent or any Lender if such collection or
enforcement is done by, through or with the assistance of an attorney;
(f) prosecuting or defending any claim in any way arising out of, related
to, or connected with this Agreement, the Notes or any of the other Loan
Documents, which expenses shall include the fees and disbursements of counsel to
Agent or any Lender and of experts and other consultants retained by Agent or
any Lender; and
(g) the exercise by Agent or any Lender of any right or remedy granted to
it under this Agreement, the Notes or any of the other Loan Documents including
the fees and disbursements of counsel to Agent or any Lender.
SECTION 13.03. STAMP, INTANGIBLE AND RECORDING TAXES. The Borrower will
pay any and all stamp, intangible, registration, recordation and similar taxes,
fees or charges and shall indemnify the Agent and each Lender against any and
all liabilities with respect to or resulting from any delay in the payment or
omission to pay any such taxes, fees or charges, which may be payable or
determined to be payable in connection with the execution, delivery, performance
or enforcement of this Agreement, the Notes and any of the other Loan Documents
or the perfection of any rights or Liens thereunder.
SECTION 13.04. SETOFF. Subject to Section 4.06 and in addition to any
rights now or hereafter granted under Applicable Law and not by way of
limitation of any such rights, from and after the occurrence of an Event of
Default each Lender is hereby authorized by the Borrower, at any time or from
time to time, without notice to the Borrower or to any other Person, any such
notice being hereby expressly waived, to set-off and to appropriate and to
apply any and all deposits (general or special, including, but not limited
to, indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by such
Lender or any Affiliate of such Lender, to or for the credit or the account
of the Borrower against and on account of any of the Obligations,
irrespective of whether or not the Lenders shall have declared any or all of
the Loans and other Obligations to be due and payable as permitted by Section
11.02, and although such obligations shall be contingent or unmatured. The
benefits of such setoff shall be shared by the Lenders in accordance with the
pro rata share of their aggregate Commitments as compared to the aggregate
Commitments of all Lenders.
SECTION 13.05. LITIGATION. (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY
DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE BORROWER, THE AGENT OR ANY OF THE
LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND FACT.
ACCORDINGLY, EACH OF THE LENDERS, THE AGENT AND THE BORROWER HEREBY WAIVES TRIAL
BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR
TRIBUNAL IN WHICH AN ACTION MAY BE COMMENCED BY OR AGAINST THE BORROWER ARISING
OUT OF THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT OR IN CONNECTION
WITH THE COLLATERAL OR ANY LIEN OR BY REASON OF ANY OTHER CAUSE OR DISPUTE
WHATSOEVER BETWEEN OR AMONG THE BORROWER, THE AGENT OR ANY OF THE LENDERS OF ANY
KIND OR NATURE.
54
(b) THE BORROWER, THE AGENT AND EACH LENDER EACH HEREBY AGREE THAT THE
CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT OF FLORIDA, LOCATED IN PALM
BEACH COUNTY, FLORIDA AND THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF FLORIDA, SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY
CLAIMS OR DISPUTES BETWEEN OR AMONG ANY OR ALL OF THE BORROWER, THE AGENT OR ANY
OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE NOTES
OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HERE FROM OR THEREFROM OR
THE COLLATERAL. THE BORROWER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS. THE CHOICE
OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING
OF ANY ACTION BY AGENT OR ANY LENDER FOR THE ENFORCEMENT BY SUCH AGENT OR LENDER
OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.
(c) THE FOREGOING WAIVERS HAVE BEEN MADE WITH THE ADVICE OF COUNSEL AND
WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF.
SECTION 13.06. ASSIGNABILITY.
(a) The Borrower shall not have the right to assign this Agreement or any
interest therein except with the prior written consent of the Agent and the
Lenders.
(b) Notwithstanding Section 13.06(c) below, without the consent of the
Agent and the Borrower (i) any Lender may make, carry or transfer Loans at, to
or for the account of, any of its branch offices or the office of an Affiliate
of such Lender or (ii) any Lender may pledge any Loans or Notes to any Federal
Reserve Bank.
(c) Each Lender may, with the consent of the Agent and the Borrower (which
consent will not be unreasonably withheld or delayed), assign to one or more
financial institutions all or a portion of its respective Commitment; PROVIDED,
HOWEVER, that (i) for each such assignment, the parties thereto shall execute
and deliver to the Agent for acceptance and recording by the Agent in the
Register (as defined below), an Assignment and Assumption Agreement
substantially in the form of Exhibit "L" (each an "ASSIGNMENT AND ASSUMPTION
AGREEMENT"), together with any Note subject to such assignment and a processing
and recordation fee of $2,500, which, unless otherwise agreed, shall be payable
by the assignor, and (ii) no such assignment shall be for less than one hundred
percent (100%) of the Commitment of such Lender, unless such assignment is to a
then-current holder of a Note. Upon the effectiveness of the Assignment and
Assumption Agreement as provided therein, from and after the date specified as
the effective date in the Assignment and Assumption Agreement (the "ACCEPTANCE
DATE"), (x) the assignee thereunder shall be a party hereto, and, to the extent
that rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Assumption Agreement, such assignee shall have the rights and
obligations of a "Lender" hereunder and (y) the assignor thereunder shall, to
the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Assumption Agreement, relinquish its rights
(other than any rights it may have pursuant to Sections 13.02 and 13.10 which
will survive such assignment) and be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption Agreement covering
all or the remaining portion of an assigning Lender's rights and obligations
under this Agreement, the Notes and the other Loan
55
Documents such Lender shall cease to be a party hereto). Agent and each
Lender agrees that in connection with any such assignment, they will exert
good faith efforts to assure that Borrower and the assignment are not subject
to Florida documentary stamp or transfer taxes by reason of such assignment.
If however after the exertion of good faith efforts such assignment is found
to be subject to such taxes, Borrower shall be obligated to pay same and any
interest, penalties or fees in connection therewith.
(d) The Agent shall maintain at the Principal Office a copy of each
Assignment and Assumption Agreement delivered to and accepted by it and a
register for the recordation of the names and addresses of the Lenders and the
Commitments of each Lender from time to time (the " REGISTER"). The Agent shall
give notice to each Lender of any assignment. The Borrower, the Agent and the
Lenders may treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of this Agreement. The Register and copies of each
Assignment and Assumption Agreement shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice to the Agent.
(e) Upon its receipt of an Assignment and Assumption Agreement executed by
an assigning Lender, together with each Note subject to such assignment (the
"SURRENDERED NOTE"), the Agent shall, if such Assignment and Assumption
Agreement has been completed and is in substantially the form of Exhibit "L",
(i) accept such Assignment and Assumption Agreement, (ii) record the information
contained therein in the Register, (iii) give prompt notice thereof to the
Borrower and (iv) revise the information set forth on Annex I to reflect the
effect of such Assignment and Assumption Agreement, and distribute a copy of
such revised Annex I to each Lender and the Borrower. Within five Business Days
after its receipt of such notice, the Borrower shall acknowledge such Assignment
and Assumption Agreement and shall execute and deliver to the Agent in exchange
for the Surrendered Note or Notes a new Note or Notes to the order of the
assignee in an amount equal to the Commitment or Commitments assumed by it
pursuant to such Assignment and Assumption Agreement and, if the assigning
Lender has retained a Commitment or Commitments hereunder, a new Note or Notes
to the order of the assigning Lender in an amount equal to the Commitment or
Commitments retained by it hereunder. Such new Note or Notes shall re-evidence
the indebtedness outstanding under the old Note or Notes and shall be in an
aggregate principal amount equal to the aggregate principal amount of such
Surrendered Note or Surrendered Notes, shall be dated the Agreement Date and
shall otherwise be in substantially the form, of the Note or Notes subject to
such assignments. The assignment by a Lender of a Commitment or portion thereof
to another Person and the execution and delivery of a new Note or Notes shall
not constitute a novation of the indebtedness evidenced by the Surrendered Note
or Surrendered Notes and incurred in connection with such assigned Commitment.
(f) Each Lender may sell participations (PROVIDED, HOWEVER, that prior to
selling any such participations, such Lender shall have given the prior written
notice to the Agent and the Borrower of such participation) to one or more
parties in or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
the Loans owing to it and the Note or Notes held by it); PROVIDED, HOWEVER, that
(i) such Lender's obligations under this Agreement (including, without
limitation, its Commitment to the Borrower hereunder) shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Lender shall remain the holder
of any such Note for all purposes of this Agreement, (iv) the Borrower, the
Agent, and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement and (v) such Lender shall not transfer, grant, assign or sell any
participation under which the participant shall have rights to approve any
amendment or waiver of this Agreement except to the extent such amendment or
56
waiver would (A) extend the final maturity date or the date of the payments of
any installment of fees or principal or interest of any Loans or Reimbursement
Obligations in which such participant is participating, (B) reduce the amount
of any installment of principal of the Loans or Reimbursement Obligations in
which such participant is participating, (C) reduce the interest rate applicable
to the Loans or Reimbursement Obligations in which such participant is
participating, or (D) except as otherwise expressly provided in this Agreement,
reduce any fees payable to the Lenders hereunder.
(g) Each Lender agrees that, without the prior written consent of the
Borrower and the Agent, it will not make any assignment hereunder in any manner
or under any circumstances that would require registration or qualification of,
or filings in respect of, any Loan or Note under the securities laws of the
United States of America or of any other jurisdiction.
(h) In connection with the efforts of any Lender to assign its rights or
obligations or to participate interests, such Lender may disclose any
information in its possession regarding the Borrower; PROVIDED, HOWEVER, that
prior to disclosing any such information, such Lender shall receive the prior
written consent of the Agent.
SECTION 13.07. AMENDMENTS. Except as otherwise expressly provided in this
Agreement, any consent or approval required or permitted by this Agreement or in
any Loan Document to be given by the Lenders may be given, and any term of this
Agreement or of any other Loan Document may be amended, and the performance or
observance by the Borrower of any terms of this Agreement or such other Loan
Document or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Required Lenders. Notwithstanding the foregoing, the
rates of interest on the Loans and the Notes, the dates on which any interest
payable by the Borrower under any Loan Document is due, the Revolving
Termination Date, the repayment obligations with respect to any Reimbursement
Obligations, any financial covenant, the amount and payment date of any Fees
(other than Fees payable solely to the Agent) and this Section 13.07 may not be
amended, or the Borrower's compliance thereunder may not be waived, without the
written consent of all the Lenders and the Borrower. Further, the definition of
any minimum requirement necessary for the Lenders to take action hereunder,
Available Revolving Commitment, Revolving Commitment, L/C Commitment Amount and
L/C Termination Date may not be amended without the written consent of all of
the Lenders and the Borrower. Further, the Form of Borrowing Base Certificate,
the definitions used therein and the percentages and advance rates used in
calculating the Borrowing Base may not be amended without the written consent
(which may be given orally and confirmed in writing) of all of the Lenders and
the Borrower other than any immaterial changes approved by the Agent in ordinary
course. Further, no amendment, waiver or consent unless in writing and signed
by the Agent, in addition to the Lenders required hereinabove to take such
action, shall affect the rights or duties of the Agent under this Agreement or
any of the other Loan Documents. Further, no Collateral at any time held by the
Agent shall be released or disposed of by the Agent unless all of the Lenders so
direct the Agent and except in accordance with Section 12.06 hereof. No waiver
shall extend to or affect any obligation not expressly waived or impair any
right consequent thereon. No course of dealing or delay or omission on the part
of any Lender or the Agent in exercising any right shall operate as a waiver
thereof or otherwise be prejudicial thereto. Except as otherwise explicitly
provided for herein or in any other Loan Document, no notice to or demand upon
the Borrower shall entitle the Borrower to other or further notice or demand in
similar or other circumstances. In no event shall the Borrower be required to
enter into an amendment pursuant to this Section 13.07 if such amendment would
otherwise require the consent of all of the Lenders as provided in this Section
13.07. Notwithstanding any of the foregoing to the contrary, the
57
consent of the Borrower shall not be required for any amendment, modification
or waiver of the provisions of Article XII (other than the provisions of
Section 12.07). In addition, the Borrower and the Lenders hereby authorize
the Agent to modify this Agreement by unilaterally amending or supplementing
Annex I from time to time in the manner requested by the Borrower, the Agent
or any Lender in order to reflect any assignments or transfers of the
Commitments as provided for hereunder; PROVIDED, HOWEVER, that the Agent
shall promptly deliver a copy of any such modification to the Borrower and
each Lender.
SECTION 13.08. NONLIABILITY OF AGENT AND LENDERS. The relationship
between the Borrower and the Lenders and the Agent shall be solely that of
borrower and lender. Neither the Agent nor any Lender shall have any fiduciary
responsibilities to the Borrower. Neither the Agent nor any Lender undertake
any responsibility to the Borrower to review or inform the Borrower of any
matter in connection with any phase of the Borrower's business or operations.
SECTION 13.09. INFORMATION. Except as otherwise provided by law, the
Agent and Lenders shall utilize all non-public information obtained pursuant to
the requirements of this Agreement which has been identified as confidential or
proprietary by the Borrower in accordance with its customary procedure for
handling confidential information of this nature and in accordance with safe and
sound banking practices but in any event may make disclosure: (i) to any of
their respective Affiliates (provided they shall agree to keep such information
confidential in accordance with the terms of this Section 13.09); (ii) as
reasonably required by any BONA FIDE transferee or participant in connection
with the contemplated transfer of any Commitment or participations therein as
permitted hereunder (Agent and Lender agree to exert good faith efforts to
require such transferee or participant to maintain such information in
confidence); (iii) as required by any Governmental Authority or representative
thereof or pursuant to legal process; (iv) to such Lender's independent auditors
and other professional advisors (provided they shall be notified of the
confidential nature of the information); and (v) after the happening and during
the continuance of an Event of Default, to any other Person, in connection with
the exercise of the Lender's rights hereunder or under any of the other Loan
Documents.
SECTION 13.10. INDEMNIFICATION. The Borrower shall and hereby agrees to,
indemnify, defend and hold harmless the Agent and each of the Lenders and their
respective directors, officers, agents, employees and counsel from and against
(a) any and all losses, claims, damages, liabilities, deficiencies, judgments or
expenses incurred by any of them (except to the extent that it is finally
judicially determined to have resulted from their own gross negligence or
willful misconduct) and (b) any such losses, claims, damages, liabilities,
deficiencies, judgments or expenses incurred in connection with any remedial or
other action taken by the Borrower, any Subsidiary or any of the Lenders in
connection with compliance by the Borrower, any Subsidiary or any of their
respective properties, with any federal, state or local Environmental Laws or
other environmental rules, regulations, orders, directions, ordinances, criteria
or guidelines. If and to the extent that the obligations of the Borrower
hereunder are unenforceable for any reason, the Borrower hereby agrees to make
the maximum contribution to the payment and satisfaction of such obligations
which is permissible under Applicable Law. The obligations of the Borrower
hereunder shall survive any termination of this Agreement and the other Loan
Documents and the payment in full of the Obligations, and are in addition to,
and not in substitution of, any other of their obligations set forth in this
Agreement.
SECTION 13.11. SURVIVAL. Notwithstanding any termination of this
Agreement, or of the other Loan Documents, the expense reimbursements and
indemnities to which the Agent and the Lenders are entitled under the provisions
of Sections 13.02 and 13.10 and any other provision of this Agreement and
58
the other Loan Documents shall continue in full force and effect and shall
protect the Agent and the Lenders against events arising after such
termination as well as before.
SECTION 13.12. TITLES AND CAPTIONS. Titles and captions of Articles,
Sections, subsections and clauses in this Agreement are for convenience only,
and neither limit nor amplify the provisions of this Agreement.
SECTION 13.13. SEVERABILITY OF PROVISIONS. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 13.14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.
SECTION 13.15. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns.
SECTION 13.16. OBLIGATIONS WITH RESPECT TO BORROWER. The Borrower
expressly waives all rights it may now or in the future have under any statute,
or at common law, or at law or in equity, or otherwise, to compel any Agent or
Lender to proceed in respect of the Obligations against the Borrower or any
other Person or against any security for the payment and performance of the
Obligations before proceeding against, or as a condition to preceding against,
the Borrower. The Borrower further expressly waives and agrees not to assert or
take advantage of any defense based upon the failure of any Agent or Lender to
commence an action in respect of the Obligations against any other Person or any
security for the payment and performance of the Obligations. The Borrower
agrees that any notice or directive given at any time to any Agent or Lender
which is inconsistent with the waivers in the preceding sentences shall be null
and void and may be ignored by such Agent or Lender, and, in addition, may not
be pleaded or introduced as evidence in any litigation relating to this
Agreement for the reason that such pleading or introduction would be at variance
with the written terms of this Agreement, unless the Agent and the Lenders have
specifically agreed otherwise in writing. The foregoing waivers are the essence
of the transaction contemplated by this Agreement and the Loan Documents and,
but for such waivers, the Lenders would decline to make the Loans and purchase
participations in the Letters of Credit and the Letter of Credit Issuer would
decline to issue the Letters of Credit under this Agreement. The Borrower
represents, warrants and agrees that its obligations under this Agreement and
the other Loan Documents are not and shall not be subject to any counterclaims,
offsets or defenses of any kind against the Agent or the Lenders now existing or
which may arise in the future, other than compulsory counterclaims or defenses
which would be lost if not asserted in that action.
SECTION 13.17. BINDING EFFECT. All of the terms and provisions of this
Agreement shall be binding upon, inure to the benefit of, and be enforceable by
the parties hereto and their respective legal representatives, successors and
permitted assigns, whether so expressed or not.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their authorized officers all as of the day and year first above
written.
59
THE BORROWER:
XXXXXXXXX INTERNATIONAL, INC.
By: /s/ A. Xxxxxxx Xxxxxxxx, Xx.
----------------------------------------
Print Name: A. Xxxxxxx Xxxxxxxx, Xx.
Title: Chairman and Chief Executive Officer
60
THE AGENT:
SOUTHTRUST BANK, NATIONAL ASSOCIATION
By: /s/ D. Xxx Xxxxxxxxx
----------------------------------------
Print: Name: D. Xxx Xxxxxxxxx
Title: Group Vice President
Address for Notices:
SouthTrust Bank, National Association
0000 Xxxx Xxxxx Xxxxx Xxxx.
0xx Xxxxx
Xxxx Xxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
000 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Florida Corporate Banking (West Palm Beach)
Telephone: 000-000-0000
Telecopier: 000-000-0000
With a copy to:
Akerman, Senterfitt & Xxxxxx, P.A.
000 Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Point - Xxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
THE LENDERS:
SOUTHTRUST BANK, NATIONAL ASSOCIATION
By: /s/ D. Xxx Xxxxxxxxx
-----------------------------------------
Print: Name: D. Xxx Xxxxxxxxx
Title: Group Vice President
61
Address for Notices:
0000 Xxxx Xxxxx Xxxxx Xxxx.
0xx Xxxxx
Xxxx Xxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
000 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Florida Corporate Banking
Telephone: 000-000-0000
Telecopier: 000-000-0000
With a copy to:
Akerman, Senterfitt & Xxxxxx, P.A.
000 Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx Point - Xxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
62
FIRST UNION NATIONAL BANK
By: /s/ X. Xxxxxx Xxxxxx
-------------------------------------
Print Name: X. Xxxxxx Xxxxxx
Title: Director
Address for Notices:
0000 Xxxxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
First Union National Bank
0000 XX 00xx Xxxxxx
Xxxxx Xxxxxxx, XX 00000
Attn: Xxxxxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
First Union National Bank
000 X. Xxxxxxx Xxxxxx
32nd Floor - Legal Division
Xxxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
00
XXXXXXXX XXXX, XXXXX XXXXXXX, N.A.
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxx
Title: Vice President
Address for Notices:
000 X. Xxxxxxx Xxxxx
0xx Xxxxx
Xxxx Xxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
00
XXXXXXXX XXXX XXXX XX XXXXXXXX,
NATIONAL ASSOCIATION
By: /s/ Xxx Xxxxxxx
-------------------------------------
Print Name: Xxx Xxxxxxx
Title: Vice President
Address for Notices:
Attn: Xxxx Xxxxxxxxx
000 Xxxxx 0xx Xxxxxx
Xxxxxxxx # X-00X
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
65
BARCLAYS BANK, PLC
By: /s/ Xxxxxxx X. Roll
-------------------------------------
Print Name: Xxxxxxx X. Roll
Title: Vice President
Address for Notices:
000 Xxxxxxxx Xxxxxx
Xxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attn: Xxxxxxx Roll
With a copy to:
Steel, Xxxxxx & Xxxxx
000 X. Xxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: __________________
66
ANNEX I TO CREDIT AGREEMENT
LIST OF LENDERS,
CREDIT PERCENTAGES AND LENDING OFFICES
LENDER CREDIT PERCENTAGE
SOUTHTRUST BANK, NATIONAL ASSOCIATION 29.577%
Lending Office (All Types):
000 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Florida Corporate Banking (West Palm Beach)
Wiring Instructions:
SouthTrust Bank, National Association
ABA #000-0000-00
Birmingham, AL
Account Number: 131009
Ref: Xxxxxxxxx International
Attn: Xxxxxx Gunding
Call: 000-000-0000 (upon receipt)
Barclays Bank, PLC 21.126%
000 Xxxxxxxx Xxxxxx
Xxxxx, XX 00000
Wiring Instructions:
Barclays Bank, PLC
ABA #000000000
Miami, FL
Account Number: unassigned at this time
Ref: Xxxxxxxxx International, Inc. and Subsidiaries
Attn: Xxxxxxx X. Roll
First Union National Bank 21.126%
0000 Xxxxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxxxx Xxxxx, XX 00000
Wiring Instructions:
First Union National Bank
ABA # 000000000
Charlotte, NC
Account Number: GL45916-2008
Ref: Xxxxxxxxx International, Inc.
Attn: Xxxxx Xxxxx-Jax
SunTrust Bank, South Florida, N.A. 14.084
000 X. Xxxxxxx Xxxxx
0xx Xxxxx
Xxxx Xxxx Xxxxx, XX 00000
Wiring Instructions:
SunTrust Bank, South Florida, N.A.
ABA #000000000
Ft. Lauderdale, FL
Account Number: 9607004110
Ref: Xxxxxxxxx International, Inc. and Subsidiaries
Attn: Xxxxxxxx Xxxxxxxx
National City Bank of Kentucky, National Association 14.084
Attn: Xxxx Xxxxxxxxx
000 Xxxxx 0xx Xxxxxx
Location # T-08J
Xxxxxxxxxx, Xxxxxxxx 00000
Wiring Instructions:
National City Bank of Kentucky
ABA #000000000
Louisville, KY
Account Number: unassigned at this time
Ref: Xxxxxxxxx International, Inc. and Subsidiaries
Attn: Xxxxx Xxxxxxx
