Exhibit 4.1
AMENDED AND RESTATED MULTICURRENCY CREDIT AGREEMENT
dated as of May 15, 2001
among
APW LTD.,
VARIOUS FINANCIAL INSTITUTIONS,
BANK ONE, NA,
as Syndication Agent,
THE CHASE MANHATTAN BANK
as Documentation Agent,
and
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Administrative Agent
Arranged by
Banc of America Securities LLC
TABLE OF CONTENTS
ARTICLE I
CERTAIN DEFINITIONS AND INTERPRETATION
Page
1.1 Defined Terms................................................................ 1
1.2 Other Interpretive Provisions................................................ 22
1.3 Accounting Principles........................................................ 23
1.4 Currency Equivalents Generally............................................... 23
1.5 Euro......................................................................... 23
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments............................................. 24
2.2 Loan Accounts................................................................ 25
2.3 Procedure for Borrowing...................................................... 25
2.4 Conversion and Continuation Elections for Borrowings......................... 26
2.5 Utilization of Revolving Commitments in Offshore Currencies.................. 28
2.6 Letters of Credit............................................................ 29
2.7 Swing Line Loans............................................................. 34
2.8 Reduction of Commitments..................................................... 36
2.9 Prepayments.................................................................. 37
2.10 Currency Exchange Fluctuations............................................... 38
2.11 Repayment.................................................................... 38
2.12 Interest..................................................................... 38
2.13 Fees......................................................................... 39
2.14 Computation of Fees and Interest............................................. 39
2.15 Payments by the Borrower..................................................... 40
2.16 Payments by the Banks to the Administrative Agent............................ 41
2.17 Sharing of Payments, Etc..................................................... 41
2.18 Warrants..................................................................... 42
ARTICLE III
GUARANTY AND COLLATERAL
3.1 Guaranties................................................................... 42
3.2 Collateral Documents......................................................... 43
3.3 Real Estate.................................................................. 44
(i)
3.4 Foreign Subsidiaries.................................................... 44
3.5 Application of Proceeds from Collateral................................. 45
3.6 Further Assurances...................................................... 45
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes................................................................... 46
4.2 Illegality.............................................................. 47
4.3 Increased Costs and Reduction of Return................................. 48
4.4 Funding Losses.......................................................... 48
4.5 Inability to Determine Rates............................................ 49
4.6 Certificates of Banks................................................... 49
4.7 Substitution of Banks................................................... 49
4.8 Survival................................................................ 50
ARTICLE V
CONDITIONS PRECEDENT
5.1 Conditions to Effectiveness of Amendment and Restatement................ 50
5.2 Conditions to All Borrowings and Letters of Credit...................... 52
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1 Organization, etc....................................................... 53
6.2 Authorization; No Conflict.............................................. 53
6.3 Validity and Binding Nature............................................. 53
6.4 Financial Statements.................................................... 54
6.5 No Material Adverse Effect.............................................. 54
6.6 Litigation and Contingent Liabilities................................... 54
6.7 Liens................................................................... 55
6.8 Subsidiaries............................................................ 55
6.9 Pension and Welfare Plans............................................... 55
6.10 Regulated Industry...................................................... 55
6.11 Regulations U and X..................................................... 55
6.12 Taxes................................................................... 55
6.13 Environmental and Safety Matters........................................ 56
6.14 Compliance with Law..................................................... 56
(ii)
6.15 Information............................................................... 56
6.16 Ownership of Properties................................................... 57
6.17 Patents, Trademarks, etc.................................................. 57
6.18 Insurance................................................................. 57
6.19 Solvency.................................................................. 57
6.20 Intercompany Debt......................................................... 57
6.21 Financial Assistance...................................................... 57
ARTICLE VII
COVENANTS
7.1 Reports, Certificates and Other Information............................... 58
7.2 Books, Records and Inspections............................................ 60
7.3 Insurance................................................................. 60
7.4 Compliance with Law; Payment of Taxes and Liabilities..................... 60
7.5 Maintenance of Existence, etc............................................. 60
7.6 Financial Ratios and Restrictions......................................... 61
7.7 Mergers, Consolidations and Purchases..................................... 62
7.8 Commercial Paper.......................................................... 62
7.9 Liens..................................................................... 62
7.10 Use of Proceeds........................................................... 63
7.11 Maintenance of Property................................................... 63
7.12 Employee Benefit Plans.................................................... 63
7.13 Business Activities....................................................... 63
7.14 Environmental Matters..................................................... 63
7.15 Unconditional Purchase Obligations........................................ 64
7.16 Inconsistent Agreements................................................... 64
7.17 Transactions with Affiliates.............................................. 64
7.18 The Borrower's and Subsidiaries' Stock.................................... 64
7.19 Restrictive Agreements.................................................... 64
7.20 Sales of Assets........................................................... 64
7.21 Loans and Investments..................................................... 65
7.22 Limitation on Debt and Subsidiary Debt.................................... 65
7.23 Restricted Payments....................................................... 66
ARTICLE VIII
EVENTS OF DEFAULT AND THEIR EFFECT
8.1 Events of Default......................................................... 66
8.2 Effect of Event of Default................................................ 68
(iii)
ARTICLE IX
THE ADMINISTRATIVE AGENT
9.1 Appointment and Authorization; Administrative Agent................ 69
9.2 Delegation of Duties............................................... 69
9.3 Liability of Administrative Agent.................................. 69
9.4 Reliance by Administrative Agent................................... 70
9.5 Notice of Default.................................................. 70
9.6 Credit Decision.................................................... 71
9.7 Indemnification of Administrative Agent............................ 71
9.8 Bank of America in Individual Capacity............................. 72
9.9 Successor Administrative Agent..................................... 72
9.10 Withholding Tax.................................................... 72
9.11 Syndication Agent or Documentation Agent........................... 74
9.12 Collateral Matters................................................. 74
ARTICLE X
MISCELLANEOUS
10.1 Amendments and Waivers............................................. 75
10.2 Release of Collateral.............................................. 76
10.3 Notices............................................................ 76
10.4 No Waiver; Cumulative Remedies..................................... 77
10.5 Costs and Expenses................................................. 77
10.6 Borrower Indemnification........................................... 78
10.7 Payments Set Aside................................................. 78
10.8 Successors and Assigns............................................. 78
10.9 Assignments, Participations, etc................................... 79
10.10 Confidentiality.................................................... 80
10.11 Set-off............................................................ 81
10.12 Notification of Addresses, Lending Offices, Etc.................... 81
10.13 Counterparts....................................................... 81
10.14 Severability....................................................... 81
10.15 No Third Parties Benefitted........................................ 81
(iv)
10.16 Governing Law and Jurisdiction................................ 82
10.17 Waiver of Jury Trial.......................................... 82
10.18 Judgment...................................................... 83
10.19 Entire Agreement.............................................. 83
(v)
SCHEDULES and EXHIBITS
Schedule 1.1 Disclosure Schedule
Item 1.1 Dissolution Subsidiaries
Item 6.6 Litigation
Item 6.8 Subsidiaries
Item 6.13 Environmental Disclosure
Item 6.14 Compliance with Laws
Item 6.16 Real Property
Item 6.18 Insurance
Item 7.9 Liens
Schedule 1.2 Closing Date Guarantors
Schedule 1.3 Parties to Debenture
Schedule 1.4 Originators
Schedule 2.1 Commitments
Schedule 7.6(a)(i) EBITDARR
Schedule 7.6(a)(ii) Non-GAAP Restructuring Expenses
Schedule 7.6(a)(iii) GAAP Restructuring Expenses
Schedule 7.6(a)(iv) Free Cash Flow
Schedule 7.6(a)(v) Capital Expenditures
Schedule 7.6(b) Monthly Revenue
Schedule 7.21 Existing Investments
Schedule 7.22 Existing Debt
Schedule 10.3 Lending Offices, Addresses for Notices
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinions of Borrowers' Counsel
Exhibit E Form of Assignment and Acceptance Agreement
Exhibit F Form of Note
Exhibit G Form of Guaranty
Exhibit H Form of Subordination
Exhibit I Form of Warrant Agreement
Exhibit J Form of Reaffirmation of Guarantee
Exhibit K Form of Securitization Intercreditor Agreement
Exhibit L Form of Debenture
Exhibit M Form of UK/US Intercreditor Agreement
Exhibit N Form of Amendment to Securitization Intercreditor Agreement
(iv)
Exhibit O Form of Amendment to UK Credit Agreement
Exhibit P Form of Commitment Reduction Certificate
(vii)
AMENDED AND RESTATED MULTICURRENCY CREDIT AGREEMENT
---------------------------------------------------
THIS AMENDED AND RESTATED MULTICURRENCY CREDIT AGREEMENT (this "Agreement")
---------
dated as of May 15, 2001 is among APW LTD., a Bermuda corporation (the
"Borrower"), the financial institutions listed on the signature pages hereof
--------
(together with their respective successors and assigns, collectively the "Banks"
-----
and individually each a "Bank"), BANK ONE, NA, as Syndication Agent, THE CHASE
----
MANHATTAN BANK, as Documentation Agent and BANK OF AMERICA, NATIONAL
ASSOCIATION, as Administrative Agent for the Banks.
WHEREAS, the Borrower entered into a Multicurrency Credit Agreement (the
"Existing Credit Agreement"), dated as of July 31, 2000 for the purpose of
-------------------------
repaying certain existing indebtedness and to provide for working capital,
capital expenditures and other general corporate purposes; and
WHEREAS, the Borrower has breached certain covenants in the Existing Credit
Agreement; and
WHEREAS, the parties wish to cure such breaches and amend and restate the
Existing Credit Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS AND INTERPRETATION
---------------------------------------
1.1 Defined Terms. When used herein the following terms have the
-------------
following meanings (such meanings to be applicable to both the singular and
plural forms of the terms defined):
"Acquisition" means any transaction or series of related transactions
-----------
for the purpose of or resulting directly or indirectly, in (a) the
acquisition of all or substantially all of the assets of a Person, or of
any business or division of a Person, (b) the acquisition of in excess of
50% of the capital stock, partnership interests, membership interests or
equity of any Person, or otherwise causing any Person to become a
Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Subsidiary).
"Administrative Agent" means Bank of America in its capacity as
--------------------
administrative agent for the Banks hereunder, and any successor
administrative agent arising under Section 9.9.
-----------
"Administrative Agent's Payment Office" means (a) in respect of
-------------------------------------
payments in Dollars, the address for payments set forth on Schedule 10.3 or
-------------
such other address as the Administrative Agent may from time to time
specify in accordance with Section 10.3, and, (b) in the case of payments
------------
in any Offshore Currency, such address as the Administrative Agent may from
time to time specify in accordance with Section 10.3.
------------
"Administrative Agent's Consultant" shall mean Xxxxxxxx LLP or any
---------------------------------
other consultant engaged by the Administrative Agent in connection with
this Agreement (including future matters in connection therewith).
"Administrative Agent-Related Persons" means Bank of America in its
------------------------------------
capacity as Administrative Agent and any successor agent arising under
Section 9.9, together with their respective Affiliates (including, in the
-----------
case of Bank of America, the Lead Arranger), and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
"Affiliate" means, with respect to any Person, any other Person which,
---------
directly or indirectly, controls, is controlled by or is under common
control with such Person. For purposes of this definition, "control"
(together with the correlative meanings of "controlled by" and "under
common control with") means possession, directly or indirectly, of the
power (a) to vote 5% or more of the securities (on a fully diluted basis)
having ordinary voting power for the directors or managing general partners
(or their equivalent) of such Person or (b) to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agreement" means this Amended and Restated Multicurrency Credit
---------
Agreement.
"Applicable Currency" means, as to any particular payment, Loan, or
-------------------
Letter of Credit, Dollars or the Offshore Currency in which it is
denominated or is payable.
"Applicable Margin" means, with respect to Offshore Rate Loans or
-----------------
Letters of Credit, 3.50% and, with respect to Base Rate Loans, 2.00%. The
Applicable Margin shall be reduced by 0.375% for each Combined Commitment
Reduction. Notwithstanding the foregoing, the minimum Applicable Margin
for Offshore Rate Loans or Letters of Credit, shall be 2.375% and, with
respect to Base Rate Loans, shall be 0.875%. Any change in the Applicable
Margin shall be effective upon delivery of notice under Section 7.1(i) and
confirmation by the Administrative Agent.
2
"Applicable Non-Use Fee Rate" means 0.50% per annum.
---------------------------
"Assignee" has the meaning specified in Section 10.9.
-------- ------------
"Assignment and Acceptance Agreement" has the meaning specified in
-----------------------------------
Section 10.9.
------------
"Assignment of Security Interest in United States Trademarks and
---------------------------------------------------------------
Patents" means that certain Assignment of Security Interest in United
-------
States Trademarks and Patents, dated as of April 12, 2001 among the
Borrower and certain Subsidiaries of the Borrower.
"Attorney Costs" means and includes all reasonable fees and
--------------
disbursements of any law firm or other external counsel, the reasonable
allocated cost of internal legal services and all reasonable disbursements
of internal counsel.
"Authorized Officer" means, relative to the Borrower, those of its
------------------
officers whose signatures and incumbency shall have been certified to the
Banks pursuant to Section 5.1(l).
--------------
"Bank of America" means Bank of America, National Association, a
---------------
national banking association.
"Base Rate" means, for any day, the higher of: (a) 0.50% per annum
---------
above the latest Federal Funds Rate; and (b) the rate of interest in
effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." (The "prime rate" is a rate set by Bank of
America based upon various factors including Bank of America's costs and
desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above,
or below such announced rate.) Any change in such rate announced by Bank
of America shall take effect at the opening of business on the day
specified in the public announcement of such change.
"Base Rate Loan" means a Committed Loan in Dollars that bears interest
--------------
based on the Base Rate.
"Borrower" has the meaning specified in the preamble.
--------
"Borrowing" means a borrowing hereunder consisting of Committed Loans
---------
of the same Type made to the Borrower on the same day by the Banks under
Article II, and, in the case of Offshore Rate Loans, having the same
----------
Interest Period.
3
"Borrowing Date" means any date on which a Borrowing occurs under
--------------
Section 2.3.
-----------
"Business Day" means any day other than a Saturday, Sunday or other
------------
day on which commercial banks in San Francisco, California are authorized
or required by law to close and (a) with respect to disbursements and
payments in Dollars with respect to Offshore Rate Loans, a day on which
dealings are carried on in the applicable offshore Dollar interbank market,
and (b) with respect to any disbursements and payments in and calculations
pertaining to any Offshore Currency Loan or the determination of the Spot
Rate, a day on which commercial banks are open for foreign exchange
business in London, England, and on which dealings in the relevant Offshore
Currency are carried on in the applicable offshore foreign exchange
interbank market in which disbursement of or payment in such Offshore
Currency will be made or received hereunder.
"Capital Adequacy Regulation" means any guideline, request or
---------------------------
directive of any central bank or other Governmental Authority, or any other
law, rule or regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any bank or of any corporation
controlling a bank.
"Capital Expenditures" means, for any period, the sum of
--------------------
(a) the aggregate amount of all expenditures of the Borrower and its
Subsidiaries for fixed or capital assets made during such period which, in
accordance with GAAP, would be classified as capital expenditures; and
(b) the aggregate amount of all Capitalized Lease Liabilities
incurred during such period.
"Capital Lease" means, with respect to any Person, any lease of (or
-------------
other agreement conveying the right to use) any real or personal property
which, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of such Person.
"Capitalized Lease Liabilities" means all monetary obligations of the
-----------------------------
Borrower or any of its Subsidiaries under any leasing or similar
arrangement which, in accordance with GAAP, would be classified as
capitalized leases, and, for purposes of this Agreement and each other Loan
Document, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP, and the stated maturity
thereof shall be the date of the last payment of rent or any other amount
due under such lease prior to the first date upon which such lease may be
terminated by the lessee without payment of a penalty.
4
"Cash Flow From Operations" means, for any Fiscal Quarter, the sum of
-------------------------
(a) Consolidated Net Income plus (b) amortization of intangibles plus (c)
---- ----
depreciation plus (d) Changes In Other Assets And Liabilities.
"CERCLA" means the Comprehensive Environmental Response, Compensation
------
and Liability Act of 1980, as amended.
"Changes In Other Assets And Liabilities" means the sum of any
---------------------------------------
increases or decreases, as applicable, in (a) current assets excluding
cash, (b) non-current assets (excluding fixed assets), (c) accrued and
deferred compensation, payroll and related benefits, (d) current and
deferred Taxes payable, (e) current liabilities (excluding Debt) and (f)
other non-current liabilities (excluding Debt); provided that an increase
--------
or decrease in assets reflected in clause (a) or (b) of Cash Flow From
Operations will not be included.
"Closing Date" means the date on which all conditions precedent set
------------
forth in Section 5.1 are satisfied or waived by all Banks (or, in the case
-----------
of Section 5.1(q), waived by any Person entitled to receive such payment).
--------------
"Code" means the Internal Revenue Code of 1986.
----
"Collateral" means with respect to the Borrower, all property, assets
----------
and/or rights on or in which a Lien is now or hereafter granted by the
Borrower or any of its Subsidiaries to the Administrative Agent (or to any
agent, trustee or other party acting on behalf of the Administrative Agent)
for the benefit of the Banks, pursuant to the Collateral Documents, and any
other instruments or documents provided for herein or therein or delivered
hereunder or thereunder or in connection herewith or therewith.
"Collateral Documents" shall mean the documents pursuant to which
--------------------
Liens on Collateral are created for the benefit of the Administrative Agent
and the Banks including, without limitation, documents described in Section
-------
3.2.
---
"Combined Commitments" means the Commitments plus the Dollar
--------------------
Equivalent of commitments under the UK Facility.
"Combined Commitment Reduction" means a permanent reduction of
-----------------------------
$100,000,000 in the Combined Commitments.
"Committed Loan" means a Loan by a Bank to the Borrower under Section
-------------- -------
2.1 hereof.
---
"Commitment", as to each Bank, has the meaning specified in Section
---------- -------
2.1.
---
5
"Compliance Certificate" means a certificate substantially in the form
----------------------
of Exhibit C.
---------
"Consolidated Interest Expense" means, for any period, the
-----------------------------
consolidated interest expense of a Person and its Subsidiaries for such
period, as determined in accordance with GAAP and in any event including,
without duplication, all commissions, discounts and other fees and charges
owed with respect to letters of credit and banker's acceptances, net costs
under interest rate protection agreements, the portion of any Capital
Leases allocable to consolidated interest expense and losses and discounts
attributable to the sale of receivables and related assets.
"Consolidated Net Income" means, for any period, all amounts which, in
-----------------------
conformity with GAAP, would be included under net income on a consolidated
income statement of a Person and its Subsidiaries for such period,
exclusive of Affiliate equity earnings, inclusive of Affiliate cash
dividends (to the extent of Affiliate equity earnings) and exclusive of
extraordinary and nonrecurring gains.
"Contractual Obligation" means, relative to the Borrower or any
----------------------
Subsidiary, any provision of any security issued by the Borrower or such
Subsidiary or of any Instrument or undertaking to which the Borrower or
such Subsidiary is a party or by which it or any of its property is bound.
"Controlled Group" means all members of a controlled group of
----------------
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as a
single employer under Section 414(b) or 414(c) of the Code or Section 4001
of ERISA.
"Conversion/Continuation Date" means any date on which, under Section
---------------------------- -------
2.4, the Borrower (a) converts Committed Loans of one Type to another Type,
---
or (b) continues Committed Loans as Committed Loans of the same Type, but
with a new Interest Period.
"Debt" of any Person means, without duplication, (a) all indebtedness
----
of such Person for borrowed money, whether or not evidenced by bonds,
debentures, notes or similar instruments, (b) all obligations of such
Person as lessee under Capital Leases which have been recorded as
liabilities on a balance sheet of such Person, (c) all obligations of such
Person to pay the deferred purchase price of property or services (other
than current accounts payable in the ordinary course of business), (d) all
indebtedness secured by a Lien on the property of such Person, whether or
not such indebtedness shall have been assumed by such Person (it being
understood that if such Person has not assumed or otherwise become
personally liable for any such indebtedness, the amount of the Debt of such
Person in connection therewith shall be limited to the lesser of the face
amount of such indebtedness or the fair market value of all property of
6
such Person securing such indebtedness), (e) all obligations, contingent or
otherwise, with respect to the face amount of all letters of credit
(whether or not drawn) and banker's acceptances issued for the account of
such Person, (f) all obligations of such Person in respect of Swap
Contracts, (g) all Suretyship Liabilities of such Person, (h) any liability
under any so-called "synthetic lease" transaction entered into by such
Person, (i) all Debt (as defined above) of any partnership in which such
Person is a general partner and (j) the outstanding principal amount then
owed to investors in connection with the sale of the accounts receivable of
a Person or any Subsidiary of a Person. The amount of the Debt of any
Person in respect of Swap Contracts shall be deemed to be the unrealized
net loss position of such Person thereunder (determined for each
counterparty individually, but netted for all Swap Contracts maintained
with such counterparty).
"Debenture" means a debenture dated May 15, 2001 among certain
---------
companies listed on the attached Schedule 1.4 and Bank of America, N.A., as
Security Trustee.
"Default" means any event which if it continues uncured will, with
-------
lapse of time or notice or lapse of time and notice, constitute an Event of
Default.
"Determination Date" has the meaning specified in Section 2.5(a).
------------------ --------------
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
-------------------
Schedule 1.1.
------------
"Dissolution Subsidiary" shall mean any dormant and inactive
----------------------
subsidiary, with the majority of its assets consisting of inter-affiliate
receivables and investments, which are scheduled to be dissolved within 90
days after Closing Date, as listed on Item 1.1 to the Disclosure Schedule.
"Dollar Equivalent" means, at any time, (a) as to any amount
-----------------
denominated in Dollars, the amount thereof at such time, and (b) as to any
amount denominated in an Offshore Currency, the equivalent amount in
Dollars as determined by the Administrative Agent at such time on the basis
of the Spot Rate for the purchase of Dollars with such Offshore Currency on
the most recent Determination Date provided for in Section 2.5(a).
--------------
"Dollar(s)" and the sign "$" mean lawful money of the United States of
--------- -
America.
"Domestic Subsidiary" means a Subsidiary that is created or organized
-------------------
in or under the law of the United States, any State thereof or the
Commonwealth of Puerto Rico.
"EBITDA" means, for any Computation Period, the sum of (a)
------
Consolidated Net Income for such period, plus (b) the aggregate amount
----
deducted (or minus the aggregate amount added) with respect to federal,
-----
state, local and foreign income taxes in
7
determining such Consolidated Net Income, plus (c) Consolidated Interest
----
Expense for such period, plus (d) depreciation and amortization for such
----
period, plus (e) in the fiscal quarter ending May 31, 2001 only, the charge
----
taken to write down the book value of certain assets, such charge not to be
greater than $17.8 million and not included in Non-GAAP Restructuring
Expenses or GAAP Restructuring Expenses.
"EBITDARR" means, for any period, the sum of EBITDA plus GAAP
-------- ----
Restructuring Expenses plus Non-GAAP Restructuring Expenses.
----
"Eligible Assignee" means (a) a financial institution organized under
-----------------
the laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100,000,000; (b) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development, or a political
subdivision of any such country, and having a combined capital and surplus
of at least $100,000,000, provided that such bank is acting through a
branch or agency located in the United States; (c) a Person that is
primarily engaged in the business of commercial banking and that is (i) a
Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a Bank is a
Subsidiary, or (iii) a Person of which a Bank is a Subsidiary; (d) another
Bank; (e) any other entity which is an "accredited investor" (as defined in
Regulation D under the Securities Act of 1933, as amended) which extends
credit or buys loans as one of its businesses, including but not limited
to, insurance companies, mutual funds and lease financing companies; or (f)
other lenders or institutional investors consented to in writing in advance
by Administrative Agent. Neither the Borrower nor any Subsidiary as
Affiliate of the Borrower shall be an Eligible Assignee.
"Environmental Laws" means all applicable federal, state or local
------------------
statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to public
health and safety and protection of the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.
"Euro" means the single currency of participating member states of the
----
European Union.
"Eurocurrency Reserve Percentage" has the meaning specified in the
-------------------------------
definition of "Offshore Rate".
"Event of Default" means any of the events described in Section 8.1.
---------------- -----------
8
"Event of Loss" means, with respect to any property, any of the
-------------
following: (a) any loss, destruction or damage of such property; (b) any
pending or threatened institution of any proceedings for the condemnation
or seizure of such property or for the exercise of any right of eminent
domain; or (c) any actual condemnation, seizure or taking, by exercise of
the power of eminent domain or otherwise, of such property, or confiscation
of such property or the requisition of the use of such property.
"Existing Credit Agreement" has the meaning set forth in the preamble.
-------------------------
"Existing Guaranties" means those Guaranties executed pursuant to the
-------------------
Existing Credit Agreement on or prior to July 31, 2000.
"Federal Funds Rate" means, for any day, the rate set forth in the
------------------
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite the
caption "Federal Funds (Effective)"; or, if for any relevant day such rate
is not so published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Administrative Agent
of the rates for the last transaction in overnight Federal funds arranged
prior to 9:00 a.m. (New York City time) on that day by each of three
leading brokers of Federal funds transactions in New York City selected by
the Administrative Agent.
"Fee Letter" has the meaning specified in Section 2.13(a).
---------- ---------------
"Fiscal Quarter" means any fiscal quarter of a Fiscal Year.
--------------
"Fiscal Year" means the fiscal year of the Borrower and its
-----------
Subsidiaries, which period shall be the 12-month period ending on August 31
of each year.
"Foreign Subsidiary" means any Subsidiary that is not created or
------------------
organized in or under the law of the United States, any state thereof or
the Commonwealth of Puerto Rico.
"FRB" means the Board of Governors of the Federal Reserve System, and
---
any Governmental Authority succeeding to any of its principal functions.
"Free Cash Flow" means, for any Fiscal Quarter, the sum of the Cash
--------------
Flow From Operations minus Capital Expenditures.
"Funded Debt" of any Person at any date of determination means the sum
-----------
of all Debt described in clauses (a), (b), and (i) of the definition of
----------- ---- ---
"Debt". Funded Debt shall not include Special Securities.
9
"Further Taxes" means any and all present or future taxes, levies,
-------------
assessments, imposts, duties, deductions, fees, withholdings or similar
charges (including, without limitation, net income taxes and franchise
taxes), and all liabilities with respect thereto, imposed by any
jurisdiction on account of Taxes or Other Taxes payable or paid pursuant to
Section 4.1.
-----------
"FX Trading Office" means Cayman USD Funding No. 5761 of Bank of
-----------------
America, or such other of Bank of America's offices as Bank of America may
designate from time to time.
"GAAP" means generally accepted accounting principles set forth from
----
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which except as provided
in Section 1.3 are applicable to the circumstances as of the date of
-----------
determination.
"GAAP Restructuring Expenses" means restructuring expenses incurred by
---------------------------
the Borrower and its Subsidiaries during the period from March 1, 2001
through July 31, 2003 in accordance with GAAP.
"Governmental Authority" means any nation or government, any state or
----------------------
other political subdivision thereof, any central bank (or similar monetary
or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" means (a) each Subsidiary of the Borrower listed on
---------
Schedule 1.2 and (b) each other Person who executes or reaffirms a Guaranty
------------
on or after the Closing Date.
"Guaranty" means a guaranty of each Guarantor in substantially the
--------
form attached as Exhibit G or such other form as shall be satisfactory to
---------
the Agent.
"Hazardous Material" means
------------------
(a) any "hazardous substance", as defined by CERCLA;
(b) any "hazardous waste", as defined by the Resource
Conservation and Recovery Act;
10
(c) any crude oil, petroleum product or fraction thereof
(excluding gasoline and oil in motor vehicles, small amounts of
cleaners and similar items used in the ordinary course of business);
or
(d) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any
Environmental Law.
"Impermissible Change in Control" means at any time, any Person or
-------------------------------
group of Persons acting in concert, which are unacceptable to the Required
Banks, have obtained control of more than 20% of the issued and outstanding
shares of capital stock of the Borrower having the power to elect a
majority of directors of the Borrower.
"Indemnified Liabilities" has the meaning specified in Section 10.6.
----------------------- ------------
"Indemnified Person" has the meaning specified in Section 10.6.
------------------ ------------
"Instrument" means any contract, agreement, letter of credit,
----------
indenture, mortgage, document or writing (whether by formal agreement,
letter or otherwise) under which any obligation is evidenced, assumed or
undertaken, or any Lien (or right or interest therein) is granted or
perfected.
"Interest Payment Date" means, as to any Committed Loan other than a
---------------------
Base Rate Loan, the last day of each Interest Period applicable to such
Committed Loan and, as to any Base Rate Loan, the last Business Day of each
February, May, August and November, provided, however, that if any Interest
-------- -------
Period for an Offshore Rate Loan exceeds three months, the date that falls
three months after the beginning of such Interest Period and after each
Interest Payment Date thereafter is also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the period
---------------
commencing on the Borrowing Date of such Loan, or (in the case of any
Offshore Rate Loan in Dollars) on the Conversion/Continuation Date on which
the Loan is converted into or continued as an Offshore Rate Loan, and
ending on the date one, two, three or, if available for the requested
Applicable Currency, six months thereafter as selected by the Borrower in
its Notice of Borrowing or Notice of Conversion/Continuation, as the case
may be;
provided that:
--------
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to the
following Business Day unless, in the case of an Offshore Rate Loan,
the result of such extension would be to carry such Interest Period
into another calendar month, in which event such Interest Period shall
end on the preceding Business Day;
11
(ii) any Interest Period pertaining to an Offshore Rate Loan
that 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 the calendar month at the end of such Interest Period;
and
(iii) no Interest Period for any Loan shall extend beyond the
Termination Date.
"Investment" means, with respect to any Person:
----------
(a) any loan or advance made by such Person to any other Person;
and
(b) any capital contribution made by such Person to, or
ownership or similar interest held by such Person in, any other
Person.
The amount of any Investment shall be the original principal or
capital amount thereof less all returns of principal or equity thereon (and
without adjustment by reason of the financial condition of such other
Person) and shall, if made by the transfer or exchange of property other
than cash, be deemed to have been made in an original principal or capital
amount equal to the fair market value of such property.
"Issuance" means the issuance of a Letter of Credit.
--------
"Issuance Date" means the date as of which a Letter of Credit is
-------------
issued.
"Issuing Bank" means Bank of America, or any successor issuing bank
------------
hereunder.
"Lead Arranger" means Banc of America Securities LLC, as sole lead
-------------
arranger and book manager.
"Lending Office" means, as to any Bank, the office or offices of such
--------------
Bank specified as its "Lending Office" or "Domestic Lending Office" or
"Offshore Lending Office", as the case may be, on Schedule 10.3, or such
-------------
other office or offices as such Bank may from time to time notify the
Borrower and the Administrative Agent.
"Letter of Credit" means any letter of credit issued or outstanding
----------------
hereunder.
"Letter of Credit Action" means the issuance, supplement, amendment,
-----------------------
renewal, extension, modification or other action relating to a Letter of
Credit hereunder.
12
"Letter of Credit Action Date" means the date as of which a Letter of
----------------------------
Credit Action occurs.
"Letter of Credit Application" means an application for a Letter of
----------------------------
Credit Action from time to time in use by Issuing Bank.
"Letter of Credit Cash Collateral Account" means a blocked deposit
----------------------------------------
account for the Borrower at Bank of America with respect to which the
Borrower hereby grants a security interest in such account to Bank of
America as security for the Borrower's Letter of Credit Usage and with
respect to which the Borrower agrees to execute and deliver from time to
time such documentation as Administrative Agent or Bank of America may
reasonably request to further assure and confirm such security interest.
"Letter of Credit Payment Date" means the last Business Day of each
-----------------------------
February, May, August and November and the Termination Date.
"Letter of Credit Sublimit" means an amount equal to the lesser of the
-------------------------
combined Commitments and $25,000,000. The Letter of Credit Sublimit is
part of, and not in addition to, the Commitments.
"Letter of Credit Usage" means, as at any date of determination, the
----------------------
aggregate undrawn face amount of outstanding Letters of Credit plus the
----
aggregate amount of all drawings under the Letters of Credit not reimbursed
by the Borrower or converted into Loans.
"Lien" means, when used with respect to any Person, any interest of
----
any other Person in any real or personal property, asset or other right
owned or being purchased or acquired by such Person which secures payment
or performance of any obligation and shall include any mortgage, lien,
encumbrance, charge or other security interest of any kind, whether arising
by contract, as a matter of law, by judicial process or otherwise.
"Loan" means an extension of credit by a Bank to the Borrower under
----
Article II. A Loan may be a Base Rate Loan or an Offshore Rate Loan (each a
"Type" of Loan). A Loan may be a Committed Loan or a Swing Loan.
"Loan Documents" means this Agreement, any Notes, the Fee Letter, any
--------------
Letter of Credit Applications, any Guaranty, the Collateral Documents and
all other documents delivered to the Administrative Agent or any Bank in
connection herewith.
"Loan Party" means the Borrower and each Guarantor.
----------
13
"Margin Stock" means any "margin stock" as defined in Regulation U of
------------
the Board of Governors of the Federal Reserve System.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
financial condition, operations, business, assets or prospects of the
Borrower and its Subsidiaries taken as a whole, or (b) the ability of the
Borrower or any Guarantor to timely and fully perform any of its payment or
other material obligations under this Agreement, any Note or any other Loan
Document.
"Minimum Tranche" means, in respect of Loans comprising part of the
---------------
same Borrowing, or to be converted or continued under Section 2.4, (a) in
-----------
the case of Swing Line Loans, $1,000,000 or any multiple of $1,000,000 in
excess thereof, (b) in the case of Base Rate Loans, $5,000,000 or any
multiple of $1,000,000 in excess thereof, and (c) in the case of Offshore
Rate Loans, the Dollar Equivalent amount of $5,000,000 or any multiple of
1,000,000 units of the Applicable Currency in excess thereof.
"Net Issuance Proceeds" means, as to any issuance of debt or equity by
---------------------
any Person, cash proceeds and non-cash proceeds received or receivable by
such Person in connection therewith, net of reasonable out-of-pocket costs
and expenses paid or incurred in connection therewith in favor of any
Person not an Affiliate of such Person, such costs and expenses not to
exceed 10% of the gross proceeds of such issuance.
"Net Proceeds" means, as to any disposition, proceeds in cash, checks
------------
or other cash equivalent financial instruments as and when received by such
Person, net of: (a) the direct costs relating to such disposition,
excluding amounts payable to such Person or any Affiliate of such Person,
(b) an estimate of cash Taxes paid or payable by such Person within nine
months of the disposition as a direct result thereof and (c) amounts
required to be applied to repay principal, interest and prepayment premiums
and penalties on purchase money liens on the asset which is the subject of
such Disposition; provided, however, that, if any portion of such proceeds
shall be applied to purchase (or reimburse other funds applied to the
purchase of) accounts receivables related to such disposition from Applied
Power Credit Corporation or Xxxxxx Capital Corporation, such portion shall
not be included in "Net Proceeds", so long as such portion shall not exceed
the amount previously paid for such accounts receivable by Xxxxxx Capital
Corporation. "Net Proceeds" shall also include proceeds paid on account of
------------
any Event of Loss, net of (i) all money actually applied to repair or
reconstruct the taking, (ii) all of the costs and expenses reasonably
incurred in connection with the collection of such proceeds, award or other
payments, and (iii) any amounts retained by or paid to parties having
superior rights to such proceeds, awards or other payments.
14
"Non-GAAP Restructuring Expenses" means restructuring expenses
-------------------------------
incurred by the Borrower and its Subsidiaries during the period from March
1, 2001 through July 31, 2003 other than GAAP Restructuring Expenses.
"Note" means a promissory note of the Borrower payable to a Bank in
----
substantially the form of Exhibit F.
---------
"Notice of Assignment and Acceptance" means a Notice of Assignment and
-----------------------------------
Acceptance substantially in the form of Exhibit E.
---------
"Notice of Borrowing" means a notice in substantially the form of
-------------------
Exhibit A.
---------
"Notice of Conversion/Continuation" means a notice in substantially
---------------------------------
the form of Exhibit B.
---------
"Obligations" means all advances to, and debts, liabilities,
-----------
obligations, covenants and duties of, the Borrower or any Guarantor arising
under any Loan Document, whether direct or indirect (including those
acquired by assignment), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest that accrues after the
commencement of any proceeding under any debtor relief laws by or against
the Borrower, any Guarantor or any Subsidiary or Affiliate thereof.
"Offshore Base Rate" has the meaning set forth in the definition of
------------------
Offshore Rate.
"Offshore Currency" means Dollars, Euros, Pounds Sterling and Yen.
-----------------
The Borrower may request that Offshore Currency include any lawful currency
constituting a eurocurrency (other than Dollars) that in the opinion of the
Administrative Agent and the Banks is freely transferable and freely
convertible into Dollars and to which the Administrative Agent and the
Banks agree.
"Offshore Currency Loan" means any Offshore Rate Loan denominated in
----------------------
an Offshore Currency.
"Offshore Rate" means for any Interest Period with respect to any
-------------
Offshore Rate Loan, a rate per annum determined by Administrative Agent
pursuant to the following formula:
Offshore Rate = Offshore Base Rate
--------------------------------------
1.00 - Eurocurrency Reserve Percentage
Where,
15
"Offshore Base Rate" means, for such Interest Period:
------------------
(a) the rate per annum (carried out to the fifth decimal place) equal
to the rate determined by Administrative Agent to be the offered rate
that appears on the page of the Telerate Screen that displays an
average British Bankers Association Interest Settlement Rate for
deposits in the applicable currency (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, or
(b) in the event the rate referenced in the preceding subsection (a)
does not appear on such page or service or such page or service shall
cease to be available, the rate per annum (carried out to the fifth
decimal place) equal to the rate determined by Administrative Agent to
be the offered rate on such other page or other service that displays
an average British Bankers Association Interest Settlement Rate for
deposits in the applicable currency (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, or
(c) in the event the rates referenced in the preceding subsections
(a) and (b) are not available, the rate per annum determined by
Administrative Agent as the rate of interest at which deposits in the
Applicable Currency (for delivery on the first day of such Interest
Period) in same day funds in the approximate amount of the applicable
Offshore Rate Loan and with a term equivalent to such Interest Period
would be offered by its London Branch to major banks in the offshore
Dollar market at their request at approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest
Period.
"Eurocurrency Reserve Percentage" means, for any day during any
-------------------------------
Interest Period, the reserve percentage (expressed as a decimal, rounded
upward to the next 1/100th of 1%) in effect on such day, whether or not
applicable to any Bank, under regulations issued from time to time by the
Board of Governors of the Federal Reserve System for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding
(currently referred to as "Eurocurrency liabilities"). The Offshore Rate
for each outstanding Offshore Rate Loan shall be adjusted automatically as
of the effective date of any change in the Eurocurrency Reserve Percentage.
The determination of the Eurocurrency Reserve Percentage and the
Offshore Base Rate by Administrative Agent shall be conclusive in the
absence of manifest error.
16
"Offshore Rate Loan" means a Committed Loan that bears interest based
------------------
on the Offshore Rate and may be an Offshore Currency Loan or a Loan
denominated in Dollars.
"Organic Document" means, relative to the Borrower or each of the
----------------
Guarantors, its certificate of incorporation, its by-laws, any other
constituent documents and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its capital stock or other
constituent documents.
"Other Taxes" means any present or future stamp, court or documentary
-----------
taxes or any other excise or property taxes, charges or similar levies
which arise from any payment made hereunder or from the execution,
delivery, performance, enforcement or registration of, or otherwise with
respect to, this Agreement or any other Loan Documents.
"Outstanding Obligations" means, as of any date, and giving effect to
-----------------------
making any Loans or taking any Letter of Credit Action requested on such
date and all payments, repayments and prepayments made on such date, (a)
when reference is made to all Banks, the sum of (i) the aggregate
outstanding principal amount of all Loans, and (ii) all Letter of Credit
Usage, and (b) when reference is made to one Bank the sum of (i) the
aggregate outstanding principal amount of all Loans made by such Bank
(excluding, in the case of Swing Line Bank, its Swing Line Loans except to
the extent provided in clause (iii) below), (ii) such Bank's ratable risk
participation in all Letter of Credit Usage, and (iii) such Bank's ratable
risk participation in all outstanding Swing Line Loans.
"Overnight Rate" means, for any day, the rate of interest per annum at
--------------
which overnight deposits in the Applicable Currency, in an amount
approximately equal to the amount with respect to which such rate is being
determined, would be offered for such day by Bank of America's London
Branch to major banks in the London or other applicable offshore interbank
market.
"Participant" has the meaning specified in Section 10.9(d).
----------- ---------------
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
----
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in
------------
section 3(2) of ERISA, which is subject to title IV of ERISA (other than a
multiemployer plan as defined in section 4001(a)(3) of ERISA), and to which
the Borrower or any corporation, trade or business that is, along with the
Borrower, a member of a Controlled Group may have any liability, including
any liability by reason of having been a substantial employer within the
meaning of section 4063 of ERISA at any time during the preceding five
years, or by reason of being deemed to be a contributing sponsor under
section 4069 of ERISA.
17
"Person" means any natural person, corporation, partnership, trust,
------
limited liability company, incorporated or unincorporated association,
joint venture, joint stock company, government (or an agency or political
subdivision thereof) or other entity, whether acting in an individual,
fiduciary or other capacity.
"Pledge Agreement" means that certain Pledge Agreement, dated as of
----------------
March 30, 2001, among the Borrower, certain Subsidiaries of the Borrower
and the Administrative Agent, as amended or modified from time to time.
"Pro Rata Share" means, as to any Bank at any time, the percentage
--------------
equivalent (expressed as a decimal, rounded to the ninth decimal place) at
such time of such Bank's Commitment divided by the combined commitments of
all Banks.
"Release" means a "release", as such term is defined in CERCLA.
-------
"Required Banks" means Banks having an aggregate Pro Rata Share of the
--------------
Commitments in excess of 50%; provided that after the Commitments have been
irrevocably terminated (through lapse of time, pursuant to Section 8.2 or
-----------
otherwise), "Required Banks" shall mean one or more Banks holding an
--------------
aggregate in excess of 50% of the Outstanding Obligations.
"Requirement of Law" means, as to any Person, any law (statutory or
------------------
common), treaty, rule or regulation or determination of an arbitrator or of
a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"Resource Conservation and Recovery Act" means the Resource
--------------------------------------
Conservation and Recovery Act, 42 U.S.C. Section 690, et seq., as in effect
-- ---
from time to time.
"Same Day Funds" means (a) with respect to disbursements and payments
--------------
in Dollars, immediately available funds, and (b) with respect to
disbursements and payments in an Offshore Currency, same day or other funds
as may be determined by the Administrative Agent to be customary in the
place of disbursement or payment for the settlement of international
banking transactions in the relevant Offshore Currency.
"SEC" means the Securities and Exchange Commission.
---
"Securitization" means that certain Amended and Restated Receivables
--------------
Purchase Agreement, dated as of April 18, 2001, among Applied Power Credit
Corporation as seller, APW North America, Inc., individually and as
servicer, Xxxxxx Capital Corporation as purchaser and Societe Generale as
agent, (as such agreement may be amended, modified, or refinanced),
provided however, that such Receivables Purchase
----------------
18
Agreement may not be amended to add as a party any Subsidiary that is not
already a party to such receivables purchase agreement as of the Closing
Date without the consent of the Required Banks. The Subsidiaries presently
parties to the Receivable Purchase Agreement are listed on Schedule 1.3.
"Securitization Intercreditor Agreement" means that certain
--------------------------------------
Intercreditor Agreement, dated as of May 15, 2001, among Xxxxxx Capital
Corporation, Societe Generale and the Administrative Agent.
"Security Agreement" means that certain Security Agreement, dated as
------------------
of March 30, 2001, among the Borrower, certain Subsidiaries of the Borrower
and the Administrative Agent, as amended or modified from time to time.
"Senior Debt" of any Person means its Funded Debt less its
-----------
Subordinated Debt.
"Shared Collateral" shall have the meaning set forth in the UK/US
-----------------
Intercreditor Agreement.
"Solvent" means, as to any Person at any time, that (a) the fair value
-------
of the property of such Person is greater than the amount of such Person's
liabilities (including disputed, contingent and unliquidated liabilities)
as such value is established and liabilities evaluated for purposes of
Section 101(31) of the Bankruptcy Code and, in the alternative, for
purposes of the Illinois Uniform Fraudulent Transfer Act; (b) the present
fair saleable value of the property of such Person is not less than the
amount that will be required to pay the probable liability of such Person
on its debts as they become absolute and matured; (c) such Person is able
to realize upon its property and pay its debts and other liabilities
(including disputed, contingent and unliquidated liabilities) as they
mature in the normal course of business; (d) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond
such Person's ability to pay as such debts and liabilities mature; and (e)
such Person is not engaged in business or a transaction, and is not about
to engage in business or a transaction, for which such Person's property
would constitute unreasonably small capital.
"Special Purpose Financing Subsidiary" means a Subsidiary that has no
------------------------------------
direct or indirect interest in any manufacturing, marketing or distribution
activities of the Borrower and Subsidiaries taken as a whole and was formed
solely for the purpose of issuing Special Securities.
"Special Securities" means
------------------
(a) securities evidencing Debt that automatically converts to common
equity of the issuer within twelve months from the date of
issuance;
19
(b) Debt
(i) that is owed to a Special Purpose Financing Subsidiary of
the Borrower,
(ii) that is issued in connection with the issuance by such
Special Purpose Financing Subsidiary of Trust Preferred
Securities,
(iii) that is subordinated in right of payment to other Debt of
the Borrower in form satisfactory to the Required Banks,
(iv) as to which the Borrower has the right to defer the
payment of all interest until after the Termination Date,
and
(v) that does not mature, in whole or in part, and is not
subject to any required repayment or prepayment, any
required sinking fund or similar payment or any repayment
or prepayment or sinking fund or similar payment at the
option of the holder thereof, prior to the Termination
Date;
(c) Guaranties by the Borrower of the issuer of any Trust Preferred
Securities in respect of such Trust Preferred Securities; and
(d) such other instruments as the Required Banks may approve from
time to time.
"Spot Rate" for a currency means the rate quoted by Bank of America as
---------
the spot rate for the purchase by Bank of America of such currency with
another currency through its FX Trading Office at approximately 8:00 a.m.
(San Francisco time) on the date two Business Days prior to the date as of
which the foreign exchange computation is made.
"Subordinated Debt" means Funded Debt of the Borrower or any
-----------------
Guarantor, subordinated to the Obligations in form satisfactory to the
Administrative Agent.
"Subsidiary" means, with respect to any Person, any corporation,
----------
association, partnership, limited liability company or other business
entity of which such Person and/or its other Subsidiaries own, directly or
indirectly, more than 50% of the voting stock, membership interests or
other equity interests. Unless the context otherwise requires, each
reference to Subsidiaries herein shall be a reference to Subsidiaries of
the Borrower.
"Suretyship Liability" means any agreement, undertaking or other
--------------------
contractual arrangement by which any Person guarantees, endorses or
otherwise becomes or is
20
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to or otherwise to
invest in a debtor, or otherwise to assure a creditor against loss) any
indebtedness, obligation or other liability (including accounts payable) of
any other Person (other than by endorsements of instruments in the course
of collection), or guarantees the payment of dividends or other
distributions upon the shares of any other Person. The amount of any
Person's obligation under any Suretyship Liability shall (subject to any
limitation set forth therein) be deemed to be the principal amount of the
indebtedness, obligation or other liability guaranteed thereby.
"Swap Contract" means any agreement, whether or not in writing,
-------------
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap
or option, bond, note or xxxx option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or
any combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"Swing Line" means the revolving line of credit established by Swing
----------
Line Bank in favor of the Borrower pursuant to Section 2.7.
-----------
"Swing Line Bank" means Bank of America, or any successor Swing Line
---------------
Bank hereunder.
"Swing Line Loan" means a loan which bears interest at a rate per
---------------
annum equal to interest payable on a Base Rate Loan and made by Swing Line
Bank to the Borrower under the Swing Line.
"Swing Line Sublimit" means an amount equal to the lesser of (a)
-------------------
$5,000,000 and (b) the combined Commitments. The Swing Line Sublimit is
part of, and not in addition to, the Commitments.
"Tangible Net Assets" means, as of any date, the consolidated total
-------------------
assets of a Person and its Subsidiaries minus all intangible assets of such
Person and its Subsidiaries, as each would be shown on a consolidated
balance sheet of such Person and its Subsidiaries prepared in accordance
with GAAP as of that date.
"Taxes" means any and all present or future taxes, levies,
-----
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case
of each Bank and the Administrative Agent, respectively, taxes imposed on
or measured by its net income by the jurisdiction (or any political
21
subdivision thereof) under the laws of which such Bank or the
Administrative Agent, as the case may be, is organized or maintains a
lending office.
"Termination Date" means the earlier to occur of (a) July 31, 2003, or
----------------
(b) the date on which the Commitments terminate pursuant to Section 8.2 or
-----------
are reduced to zero pursuant to Section 2.8.
-----------
"Trust Preferred Securities" means at any date any equity interest in
--------------------------
a Special Purpose Financing Subsidiary
(a) that is not
(i) required to be redeemed or redeemable at the option of the holder
thereof prior to the Termination Date, or
(ii) convertible into or exchangeable for (unless solely at the option
of the Borrower) (A) equity interests that are required to be redeemed
or redeemable at the option of the holder thereof prior to the
Termination Date or (B) Debt having a scheduled maturity, or requiring
any repayments or prepayments of principal or any sinking fund or
similar payments in respect of principal or providing for any such
repayment, prepayment sinking fund or other payment at the option of
the holder thereof prior to the Termination Date, and
(b) as to which, at such date, the Borrower has the right to defer the
payment of all dividends and other distributions in respect thereof
until after the Termination Date.
"Type" has the meaning specified in the definition of "Loan".
----
"UK Debt" means Debt under the UK Facility.
-------
"U.K. Facility" means collectively and without double counting (a) the
-------------
Revolving Credit Facilities, as amended and restated from time to time,
with Royal Bank of Scotland, PLC; (b) the Counter-Indemnity Agreement, as
amended and restated dated as of April 26, 2001, with National Westminster
Bank PLC; (c) the Multiline Facility Agreement, as amended and restated
dated as of May 15, 2001, with National Westminster Bank PLC; and (d) any
loan note guaranties provided by National Westminister Bank PLC pursuant to
the deeds of adherence and release entered into by Bank of America and
National Westminster Bank PLC on or around July 31, 2000.
"U.K. Subsidiary" means a Subsidiary that is created or organized
---------------
under the laws of England or Wales.
22
"UK/US Intercreditor Agreement" shall mean that certain Intercreditor
-----------------------------
Agreement, dated as of May 15, 2001 among the Administrative Agent, Bank of
America, as Security Trustee, the Banks, the Royal Bank of Scotland as
Agent, Royal Bank of Scotland, as Security Trustee, Royal Bank of Scotland
and National Westminster Bank, PLC in substantially the form of Exhibit M.
"United States" or "U.S." means the United States of America, its 50
------------- ----
States, the District of Columbia and the Commonwealth of Puerto Rico.
"Warrant Agreement" means an agreement in the form attached as Exhibit
-----------------
I.
"Welfare Plan" means a "welfare plan", as such term is defined in
------------
section 3(1) of ERISA.
1.2 Other Interpretive Provisions.
-----------------------------
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding",
and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan
23
Document, and (ii) references to any statute or regulation are to be
construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the
statute or regulation.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this
Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters.
All such limitations, tests and measurements are cumulative and shall each
be performed in accordance with their terms. Unless otherwise expressly
provided, any reference to any action of the Administrative Agent or the
Banks by way of consent, approval or waiver shall be deemed modified by the
phrase "in its/their sole discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Administrative
Agent, the Borrower and the other parties, and are the products of all
parties. Accordingly, they shall not be construed against the Banks or the
Administrative Agent merely because of the Administrative Agent's or Banks'
involvement in their preparation.
1.3 Accounting Principles. References to financial statements include
---------------------
notes thereto in accordance with GAAP; and accounting terms used but not defined
herein shall be construed in accordance with GAAP, and whenever the character or
amount of any asset or liability or item of income or expense is required to be
determined, or any consolidation or other accounting computation is required to
be made, for purposes hereof, such determination or computation shall be made in
accordance with GAAP; provided that such determinations and computations with
respect to financial covenants and ratios hereunder shall be made in accordance
with GAAP as in effect on the date hereof.
1.4 Currency Equivalents Generally. For all purposes of this Agreement
------------------------------
(but not for purposes of the preparation of any financial statements delivered
pursuant hereto), the equivalent in any Offshore Currency or other currency of
an amount in Dollars, and the equivalent in Dollars of an amount in any Offshore
Currency or other currency, shall be determined at the Spot Rate.
1.5 Euro. For the avoidance of doubt, the parties hereto affirm and agree
----
that the conversion of any Obligations under the Loan Documents from an Offshore
Currency of a country that is a member of the European Union into Euros, shall
not require the early termination of this Agreement or the prepayment of any
amount due under the Loan Documents or create any liability of one party to
another party for any direct or consequential loss arising from any of such
events. As of the date that any such Offshore Currency is no longer the lawful
24
currency of its respective country, all payment obligations under the Loan
Documents that would otherwise be in such Offshore Currency shall thereafter be
satisfied in Euros.
If more than one currency or currency unit are at the same time recognized
by the laws of any country as the lawful currency of that country, then:
(a) any reference in this Agreement to, and any Obligations arising
under this Agreement or the Loan Documents in, the currency of that country
shall be translated into, or paid into, the lawful currency or currency
unit of that country designated by the Administrative Agent; and
(b) any translation from one currency or currency unit to another
shall be at the official rate of exchange legally recognized by the central
bank of the country issuing such currency for the conversion of that
currency or currency unit into the other, rounded up or down by the
Administrative Agent acting in accordance with any applicable law on
rounding or, if there is no such law, acting reasonably in accordance with
its market practice.
If a change in any currency of a country occurs, this Agreement will be
amended to the extent the Administrative Agent (acting reasonably) specifies to
be necessary to reflect the change in currency and to put the Banks in the same
position, so far as possible, that they would have been in if no change in
currency had occurred.
ARTICLE II
THE CREDITS
-----------
2.1 Amounts and Terms of Commitments. Each Bank severally agrees, on the
--------------------------------
terms and conditions set forth herein, to make loans in Dollars and Offshore
Currencies to the Borrower (each such loan, a "Committed Loan") from time to
--------------
time on any Business Day during the period from the Closing Date to the
Termination Date, in an aggregate principal Dollar Equivalent amount not to
exceed at any time outstanding the amount set forth opposite such Bank's name in
Schedule 2.1 under the heading "Commitment" (such amount as the same may be
------------
reduced pursuant to Section 2.8 or as a result of one or more assignments
-----------
pursuant to Section 10.8, the Bank's "Commitment"); provided, however, that,
------------
after giving effect to any Borrowing of Committed Loans, the aggregate principal
Dollar Equivalent amount of the Outstanding Obligations held by each Bank shall
not exceed such Bank's Commitment and the Outstanding Obligations of all Banks
shall not exceed the combined Commitments. Within the limits of each Bank's
Commitment, and subject to the other terms and conditions hereof, the Borrower
may borrow under this Section 2.1, prepay pursuant to Section 2.9 and reborrow
----------- -----------
pursuant to this Section 2.1.
-----------
25
2.2 Loan Accounts.
-------------
(a) The Loans made by each Bank shall be evidenced by one or more
loan accounts or records maintained by such Bank in the ordinary course of
business. The loan accounts or records or schedules, as the case may be,
maintained by the Administrative Agent and each Bank shall be rebuttable
presumptive evidence of the amount of the Loans made by the Banks to the
Borrower and the interest and payments thereon. Any failure so to record or
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect
to the Loans.
(b) Upon the request of any Bank made through the Administrative
Agent, the Loans made by such Bank may be evidenced by one or more Notes.
Each such Bank may also endorse on the schedules annexed to its Note(s) the
date, amount and maturity of each Loan made by it and the amount of each
payment of principal made by the Borrower with respect thereto. Each such
Bank is irrevocably authorized by the Borrower to endorse its Note(s) and
each Bank's record shall be rebuttable presumptive evidence; provided,
--------
however, that the failure of a Bank to make, or an error in making, a
-------
notation thereon with respect to any Loan shall not limit or otherwise
affect the obligations of the Borrower hereunder or under any such Note to
such Bank.
2.3 Procedure for Borrowing.
------------------------
(a) Each Borrowing shall be made upon the Borrower's irrevocable
written notice delivered to the Administrative Agent in the form of a
Notice of Borrowing (which notice must be received by the Administrative
Agent prior to 8:30 a.m. (San Francisco time) (i) three Business Days prior
to the requested Borrowing Date, in the case of Offshore Rate Loans
denominated in Dollars; and (ii) four Business Days prior to the requested
Borrowing Date, in the case of Offshore Currency Loans and (iii) on the
requested Borrowing Date, in the case of Base Rate Loans, specifying:
(A) the amount of the Committed Borrowing, which shall be
in an aggregate amount not less than the Minimum Tranche;
(B) the requested Borrowing Date, which shall be a Business
Day;
(C) the Type of Loans comprising the Borrowing;
(D) the duration of the Interest Period applicable to such
Loans included in such notice. If the Notice of Borrowing fails
to specify the
26
duration of the Interest Period for any Borrowing comprised of
Offshore Rate Loans, such Interest Period shall be one month; and
(E) in the case of a Borrowing comprised of Offshore
Currency Loans, the Applicable Currency.
(b) The Dollar Equivalent amount of any Borrowing in an Offshore
Currency will be determined by the Administrative Agent for such Borrowing
on the Determination Date therefor in accordance with Section 2.5(a). Upon
--------------
receipt of the Notice of Borrowing, the Administrative Agent will promptly
notify each Bank thereof and of the amount of such Bank's Pro Rata Share of
the Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Administrative Agent for the account of the
Borrower, at the Administrative Agent's Payment Office on the Borrowing
Date requested by the Borrower in Same Day Funds and in the requested
currency (i) in the case of a Borrowing comprised of Loans in Dollars, by
11:00 a.m. (San Francisco time), (ii) in the case of a Borrowing comprised
of Offshore Currency Loans, by such time as the Administrative Agent may
determine to be necessary for such funds to be credited on such date in
accordance with normal banking practices in the place of payment. The
proceeds of all such Loans will then be made available to the Borrower by
the Administrative Agent by wire transfer in accordance with written
instructions provided to the Administrative Agent by the Borrower of like
funds as received by the Administrative Agent; provided that the
--------
Administrative Agent shall disburse such funds as it has received from the
Banks to the Borrower (x) in the case of Loans denominated in Dollars, no
later then 1:00 p.m. (San Francisco time) and (y) in the case of Offshore
Currency Loans, no later than two hours after the funding deadline
specified by the Administrative Agent under clause (ii) above.
(d) After giving effect to any Borrowing, there may not be more than
eight different Interest Periods in effect in respect of all Committed
Loans together then outstanding.
2.4 Conversion and Continuation Elections for Borrowings.
----------------------------------------------------
(a) The Borrower may, upon irrevocable written notice to the
Administrative Agent in accordance with Section 2.4(b):
--------------
(i) elect, as of any Business Day, in the case of Base Rate
Loans, or as of the last day of the applicable Interest Period, in the
case of any other Type of Committed Loans denominated in Dollars, to
convert any such Committed Loans
27
(or any part thereof in an amount not less than the Minimum Tranche)
into Committed Loans in Dollars of any other Type; or
(ii) elect, as of the last day of the applicable Interest Period,
to continue any Loans having Interest Periods expiring on such day (or
any part thereof in an amount not less than the Minimum Tranche);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
--------
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $5,000,000 or the Dollar Equivalent thereof, such
Offshore Rate Loans shall automatically convert into Base Rate Loans in the
Dollar Equivalent of such Offshore Rate Loans, and on and after such date the
right of the Borrower to continue such Committed Loans as, and convert such
Committed Loans into, Offshore Rate Loans shall terminate. The Borrower may not
convert Committed Loans in one Applicable Currency to Committed Loans in another
Applicable Currency.
(b) The Borrower shall deliver a Notice of Conversion/Continuation to
be received by the Administrative Agent not later than 8:30 a.m. (San
Francisco time) at least (i) three Business Days in advance of the
Conversion/Continuation Date, if the Committed Loans are to be converted
into or continued as Offshore Rate Loans denominated in Dollars; (ii) four
Business Days in advance of the Conversion/Continuation Date, if the
Committed Loans are to be converted into or continued as Offshore Currency
Loans; and (iii) on the Conversion/Continuation Date, if the Loans
denominated in Dollars are to be converted into Base Rate Loans,
specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Committed Loans to be converted
or continued;
(C) the Type of Committed Loans resulting from the proposed
conversion or continuation;
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period; and
(E) if applicable, the Applicable Currency.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans in Dollars, the Borrower has failed to select timely a
new Interest Period to be applicable to such Offshore Rate Loans, or if any
Default or Event of Default then exists, the Borrower shall be deemed to
have elected to convert such Offshore Rate Loans into
28
Base Rate Loans denominated in Dollars in the Dollar Equivalent of such
Offshore Rate Loan effective as of the expiration date of such Interest
Period. If the Borrower has failed to select a new Interest Period to be
applicable to Offshore Currency Loans prior to the fourth Business Day in
advance of the expiration date of the current Interest Period applicable
thereto as provided in Section 2.4(b), or if any Default or Event of
--------------
Default shall then exist, subject to the provisions of Section 2.5(d), the
--------------
Borrower shall be deemed to have elected to pay such Offshore Currency
Loans and borrow the Dollar Equivalent in Base Rate Loans.
(d) The Administrative Agent will promptly notify each Bank of its
receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Borrower, the Administrative Agent will promptly notify
each Bank of the details of any automatic conversion. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Committed Loans with respect to which the notice
was given.
(e) Unless the Required Banks otherwise agree, during the existence
of a Default or Event of Default, the Borrower may not elect to have a Loan
converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of
Committed Loans, there may not be more than eight different Interest
Periods in effect in respect of all Committed Loans together then
outstanding.
2.5 Utilization of Revolving Commitments in Offshore Currencies.
-----------------------------------------------------------
(a) The Administrative Agent will determine the Dollar Equivalent
with respect to any (i) Borrowing comprised of Offshore Currency Loans as
of the requested Borrowing Date and as of any requested continuation date,
(ii) Letter of Credit Usage denominated in Offshore Currencies as of any
Letter of Credit Action Date with respect thereto, and (iii) outstanding
Offshore Currency Loans and Letter of Credit Usage as of the last Banking
Day of each month, and, during the occurrence and continuation of an Event
of Default, such other dates as may be requested by the Required Banks (but
in no event more frequently than once a week) (each such date under clauses
(i), (ii), and (iii) a "Determination Date").
(b) In the case of a proposed Borrowing comprised of Offshore
Currency Loans, the Banks shall be under no obligation to make Offshore
Currency Loans in the requested Offshore Currency as part of such Borrowing
if the Administrative Agent has received notice from the Required Banks by
12:30 p.m. (San Francisco time) three Business Days prior to the day of
such Borrowing that deposits in the relevant Offshore Currency (in the
applicable amounts) are not being offered to such Banks in the interbank
29
eurocurrency market for such Interest Period in which event the
Administrative Agent will give notice to the Borrower no later than 1:30
p.m. (San Francisco time) on the third Business Day prior to the requested
date of such Borrowing that the Borrowing in the requested Offshore
Currency is not then available, and notice thereof also will be given
promptly by the Administrative Agent to the Banks. If the Administrative
Agent shall have so notified the Borrower that any such Borrowing in a
requested Offshore Currency is not then available, the Notice of Borrowing
relating to such requested Borrowing shall be deemed to be withdrawn, the
Borrowing requested therein shall not occur and the Administrative Agent
will promptly so notify each Bank.
(c) In the case of a proposed continuation of Offshore Currency Loans
for an additional Interest Period pursuant to Section 2.4, the Banks shall
-----------
be under no obligation to continue such Offshore Currency Loans if the
Administrative Agent has received notice from the Required Banks by 12:30
p.m.(San Francisco time) three Business Days prior to the day of such
continuation that deposits in the relevant Offshore Currency (in the
applicable amounts) are not being offered to such Banks in the interbank
eurocurrency market for such Interest Period in which event the
Administrative Agent will give notice to the Borrower not later than 1:30
p.m. (San Francisco time) on the third Business Day prior to the requested
date of such continuation that the continuation of such Offshore Currency
Loans in the relevant Offshore Currency is not then available, and notice
thereof also will be given promptly by the Administrative Agent to the
Banks. If the Administrative Agent shall have so notified the Borrower
that any such continuation of Offshore Currency Loans is not then
available, any Notice of Continuation with respect thereto shall be deemed
withdrawn and such Offshore Currency Loans shall be repaid on the last day
of the Interest Period with respect to any such Offshore Currency Loans.
(d) Notwithstanding anything herein to the contrary, during the
existence of a Default or an Event of Default, unless the Required Banks
otherwise agree, all outstanding Offshore Currency Loans shall be
redenominated and converted into their Dollar Equivalent of Base Rate Loans
in Dollars on the last day of the Interest Period applicable to any such
Offshore Currency Loans.
2.6 Letters of Credit.
-----------------
(a) The Letter of Credit Sublimit. Subject to the terms and
-----------------------------
conditions set forth in this Agreement, until the Termination Date, the
Issuing Bank shall take such Letter of Credit Actions as the Borrower may
from time to time request; provided, however, that, after giving effect to
-------- -------
such Letter of Credit Action, the (i) Outstanding Obligations of each Bank
shall not exceed such Bank's Commitment, and the Outstanding Obligations of
all Banks shall not exceed the combined Commitments at any time and, (ii)
Letter of Credit Usage shall not exceed the Letter of Credit Sublimit at
any time. Subject to subsection (f) below and unless consented to by the
Issuing Bank and
30
Required Banks,no Letter of Credit may expire more than 12 months after the
date of its issuance or last renewal; provided, however, that no Letter of
-------- -------
Credit shall expire after the Termination Date. If any Letter of Credit
Usage remains outstanding after such date, the Borrower shall, not later
than such date, deposit cash in an amount equal to such Letter of Credit
Usage in a Letter of Credit Cash Collateral Account. All Letters of Credit
shall be issued for the account of the Borrower.
(b) Requesting Letter of Credit Actions. The Borrower may irrevocably
-----------------------------------
request a Letter of Credit Action in Dollars or an Offshore Currency in the
amount of not less than $5,000,000 or the Dollar Equivalent thereof by
delivering a Letter of Credit Application therefor to Issuing Bank, with a
copy to Administrative Agent (who shall notify Banks), by 8:30 a.m. (San
Francisco time) three Business Days prior to the requested Letter of Credit
Action Date. Only standby letters of credit, not commercial letters of
credit, may be issued hereunder. Each Letter of Credit Action shall be in
a form acceptable to the Issuing Bank in its sole discretion. Unless the
Administrative Agent notifies the Issuing Bank that such Letter of Credit
Action is not permitted hereunder, or the Issuing Bank notifies
Administrative Agent that it has determined that such Letter of Credit
Action is contrary to any laws or policies of the Issuing Bank, the Issuing
Bank shall, upon satisfaction of the applicable conditions set forth in
Section 5.2, effect such Letter of Credit Action. This Agreement shall
-----------
control in the event of any conflict with any Letter of Credit Application.
Upon the issuance of a Letter of Credit, each Bank shall be deemed to have
purchased from the Issuing Bank a risk participation therein in an amount
equal to that Bank's Pro Rata Share times the amount of such Letter of
Credit Usage.
(c) Reimbursement of Payments Under Letters of Credit. The Borrower
-------------------------------------------------
shall reimburse the Issuing Bank through the Administrative Agent for any
payment that the Issuing Bank makes under a Letter of Credit on or before
the date of such payment; provided, however, that if the conditions
-------- -------
precedent set forth in Section 5.2 can be satisfied, the Borrower may
-----------
request a Borrowing to reimburse the Issuing Bank for such payment or,
failing to make such request, the Borrower shall be deemed to have
requested a Borrowing of Loans which are Base Rate Loans on such payment
date pursuant to subsection (e) below in the Dollar Equivalent of such
payment.
(d) Funding by Banks When the Issuing Bank Not Reimbursed. Upon any
-----------------------------------------------------
drawing under a Letter of Credit, the Issuing Bank shall notify
Administrative Agent and the Borrower. If the Borrower fails to timely make
the payment required pursuant to subsection (c) above, the Issuing Bank
shall notify the Administrative Agent of such fact and the amount of such
unreimbursed payment. The Administrative Agent shall promptly notify each
Bank of its Pro Rata Share of such amount. Each Bank shall make funds in an
amount equal to its Pro Rata Share of such amount in the Applicable
Currency available to Administrative Agent at Administrative Agent's
Payment Office
31
not later than 11:00 a.m. (San Francisco time) on the Business Day
specified by Administrative Agent. The Administrative Agent shall remit the
funds so received to the Issuing Bank. The obligation of each Bank to so
reimburse the Issuing Bank shall be absolute and unconditional and shall
not be affected by the occurrence of a Default or Event of Default or any
other occurrence or event. Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrower to reimburse the Issuing
Bank for the amount of any payment made by the Issuing Bank under any
Letter of Credit, together with interest as provided herein.
(e) Nature of Banks' Funding. If the conditions precedent set forth
------------------------
in Section 5.2 can be satisfied on any date the Borrower is obligated to,
-----------
but fails to, reimburse the Issuing Bank for a drawing under a Letter of
Credit, the funding by Banks pursuant to the previous subsection shall be
deemed to be a Borrowing of Base Rate Loans (without regard to any minimum
amount therefor) deemed requested by the Borrower in the amount of such
drawing or the Dollar Equivalent of such drawing. If the conditions
precedent set forth in Section 5.2 cannot be satisfied on the date the
-----------
Borrower is obligated to, but fails to, reimburse the Issuing Bank for a
drawing under a Letter of Credit, the funding by Banks pursuant to the
previous subsection shall be deemed to be a funding by each Bank of its
risk participation in such Letter of Credit, in Dollars in the Dollar
Equivalent Amount of such funding, and each Bank making such funding shall
thereupon acquire a pro rata participation, to the extent of its
reimbursement, in the claim of the Issuing Bank against the Borrower in
respect of such payment and shall share, in accordance with that pro rata
participation, in any payment made by the Borrower with respect to such
claim. Any amounts made available by a Bank under its risk participation
shall be payable by the Borrower upon demand of Administrative Agent, and
shall bear interest at a rate per annum equal to the Base Rate plus the
Applicable Margin plus 2% per annum.
(f) Special Provisions Relating to Evergreen Letters of Credit. The
----------------------------------------------------------
Borrower may request Letters of Credit that have annual extension or
renewal provisions ("evergreen" Letters of Credit) so long as the Issuing
Bank consents in its sole and absolute discretion thereto and has the right
to not permit any such extension or renewal at least annually within a
period after notice from the Borrower to be agreed upon at the time each
such Letter of Credit is issued. Once an evergreen Letter of Credit is
issued the Administrative Agent shall notify the Banks and, unless
Administrative Agent has notified the Issuing Bank that the Required Banks
have elected not to permit such extension or renewal, the Borrower,
Administrative Agent and Banks shall be deemed to have authorized (but may
not require) the Issuing Bank to, in its sole and absolute discretion,
permit the renewal of such evergreen Letter of Credit at any time to a date
not later than the later of (i) one year after the prior scheduled
expiration date or (ii) the Termination Date. The Issuing Bank may, in its
sole and absolute discretion, elect not to permit an evergreen Letter of
Credit to be extended or renewed at any time.
32
(g) Obligations Absolute. The obligation of the Borrower to pay to
--------------------
the Issuing Bank the amount of any payment made by the Issuing Bank under
any Letter of Credit shall be absolute, unconditional, and irrevocable.
Without limiting the foregoing, the Borrower's obligation shall not be
affected by any of the following circumstances:
(i) any lack of validity or enforceability of the Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto;
(ii) any amendment or waiver of or any consent to departure
from the Letter of Credit, this Agreement, or any other agreement or
instrument relating hereto or thereto;
(iii) the existence of any claim, setoff, defense, or other
rights which the Borrower may have at any time against the Issuing
Bank, Administrative Agent or any Bank, any beneficiary of the Letter
of Credit (or any persons or entities for whom any such beneficiary
may be acting) or any other Person, whether in connection with the
Letter of Credit, this Agreement, or any other agreement or instrument
relating thereto, or any unrelated transactions;
(iv) any demand, statement, or other document presented under
the 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 whatsoever so long as any such document
appeared to comply with the terms of the Letter of Credit;
(v) payment by the Issuing Bank in good faith under the Letter
of Credit against presentation of a draft or any accompanying document
which does not strictly comply with the terms of the Letter of Credit;
or any payment made by the Issuing Bank under any Letter of Credit to
any Person purporting to be a trustee in bankruptcy, debtor-in-
possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or
any transferee of any Letter of Credit, including any arising in
connection with any proceeding under any bankruptcy and insolvency
laws;
(vi) the insolvency or financial responsibility of any party
issuing any documents in connection with a Letter of Credit;
(vii) any error in the transmission of any message relating to a
Letter of Credit not caused by the Issuing Bank, or any delay or
interruption in any such message;
33
(viii) any error, neglect or default of any correspondent of the
Issuing Bank in connection with a Letter of Credit;
(ix) any consequence arising from acts of God, wars,
insurrections, civil unrest, disturbances, labor disputes, emergency
conditions or other causes beyond the control of the Issuing Bank;
(x) so long as the Issuing Bank in good faith determines that
the document appears to comply with the terms of the Letter of Credit,
the form, accuracy, genuineness or legal effect of any contract or
document referred to in any document submitted to the Issuing Bank in
connection with a Letter of Credit; and
(xi) where the Issuing Bank has acted in good faith under any
other circumstances whatsoever.
In addition, the Borrower will promptly examine a copy of each Letter of
Credit and amendments thereto delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will promptly notify the Issuing Bank in writing. The Borrower shall be
conclusively deemed to have waived any such claim against the Issuing Bank and
its correspondents unless such notice is given as aforesaid.
(h) Role of the Issuing Bank. Each Bank and the Borrower agree that,
------------------------
in paying any drawing under a Letter of Credit, the Issuing Bank shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of Credit) or
to ascertain or inquire as to the validity or accuracy of any such document
or the authority of the Person executing or delivering any such document.
No Administrative Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be
liable to any Bank for any action taken or omitted in connection herewith
at the request or with the approval of the Banks or Required Banks, as
applicable; any action taken or omitted in the absence of gross negligence
or willful misconduct; or the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of
Credit. The Borrower hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of
Credit; provided, however, that this assumption is not intended to, and
-------- -------
shall not, preclude the Borrower's pursuing such rights and remedies as it
may have against the beneficiary or transferee at law or under any other
agreement. No Administrative Agent-Related Person, nor any of the
respective correspondents, participants, or assignees of the Issuing Bank,
shall be liable or responsible for any of the matters described in
subsection (g) above. In furtherance and not in limitation of the
foregoing, the Issuing Bank may accept documents that appear on their face
to be in order, without responsibility for further
34
investigation, regardless of any notice or information to the contrary, and
the Issuing Bank shall not be responsible for the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or
assign a 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.
(i) Applicability of ISP98. Unless otherwise agreed by the Issuing
----------------------
Bank and the Borrower when a Letter of Credit is issued and subject to
applicable laws, performance under Letters of Credit by the Issuing Bank,
its correspondents, and beneficiaries will be governed by the rules of the
"International Standby Practices 1998" (ISP98) or such later revision as
may be published by the International Chamber of Commerce.
(j) Letter of Credit Fee. On each Letter of Credit Payment Date, the
--------------------
Borrower shall pay to Administrative Agent in arrears, for the account of
each Bank in accordance with its Pro Rata Share, a Letter of Credit fee in
an amount equal to the Applicable Margin times the actual daily maximum
amount available to be drawn under each Letter of Credit since the later of
the Closing Date and the previous Letter of Credit Payment Date.
(k) Fronting Fee and Documentary and Processing Charges Payable to
--------------------------------------------------------------
the Issuing Bank. On each Letter of Credit Payment Date, the Borrower
----------------
shall pay to Administrative Agent for the sole account of the Issuing Bank
a fronting fee in an amount required under the Fee Letter or agreed to
between the Borrower and the Issuing Bank. In addition, the Borrower shall
pay directly to the Issuing Bank, upon demand, for its sole account its
customary documentary and processing charges in accordance with its
standard schedule, as from time to time in effect, for any Letter of Credit
Action or other occurrence relating to a Letter of Credit for which such
charges are customarily made. Such fees and charges are nonrefundable.
2.7 Swing Line Loans.
----------------
(a) Subject to the terms and conditions set forth in this Agreement,
the Swing Line Bank agrees to make Swing Line Loans to the Borrower until
the Termination Date in such amounts as the Borrower may from time to time
request; provided, however, that (i) the aggregate principal amount of all
-------- -------
Swing Line Loans shall not exceed the Swing Line Sublimit, (ii) the
Outstanding Obligations of each Bank shall not exceed such Bank's
Commitment and (iii) the Outstanding Obligations of all Banks shall not
exceed the combined Commitments at any time. This is a revolving credit
and, subject to the foregoing and the other terms and conditions hereof,
the Borrower may borrow, prepay and reborrow Swing Line Loans as set forth
herein without premium or penalty; provided, however, that Swing Line Bank
may terminate or suspend the Swing Line at
35
any time in its sole discretion upon notice to the Borrower. Each Swing
Line Loan shall bear interest at a rate equal to the rate applicable to
Base Rate Loans and shall be in Dollars.
(b) Unless notified to the contrary by Swing Line Bank, the Borrower
may irrevocably request a Swing Line Loan in the Minimum Tranche therefor
upon notice to Swing Line Bank not later than 8:30 a.m. (San Francisco
time) therefor. Each such request for a Swing Line Loan shall constitute a
representation and warranty by the Borrower that the conditions set forth
in Section 5.2 are satisfied. Promptly after receipt of such request, the
-----------
Swing Line Bank shall obtain telephonic verification from Administrative
Agent that such Swing Line Loan is permitted hereunder. Upon receiving such
verification, the Swing Line Bank shall make such Swing Line Loan available
to the Borrower. Without the consent of Required Banks and the Swing Line
Bank, no Swing Line Loan shall be made during the continuation of a Default
or Event of Default. Upon the making of each Swing Line Loan, each Bank
shall be deemed to have purchased from the Swing Line Bank a risk
participation therein in an amount equal to that Bank's Pro Rata Share
times the amount of the Swing Line Loan.
-----
(c) Each Swing Line Loan shall bear interest at a fluctuating rate
per annum equal to the rate of interest payable on Base Rate Loans and
interest shall be payable upon demand of the Swing Line Bank and on the
Termination Date. The Swing Line Bank shall be responsible for invoicing
the Borrower (or notifying Administrative Agent to so invoice the Borrower)
for such interest. The interest payable on Swing Line Loans is solely for
the account of the Swing Line Bank, except following any funding of a risk
participation under clause (f) below.
(d) The Borrower shall repay each Swing Line Loan on the earliest of
(i) the fifth Business Day after it is made, (ii) upon demand made by Swing
Line Bank and (iii) the Termination Date. The Borrower shall repay the
principal amount of each Swing Line Loan by payment directly to Swing Line
Bank or by Swing Line Bank debiting the Borrower's deposit account at Swing
Line Bank not later than 8:00 a.m. San Francisco time for payments
hereunder. If the conditions precedent set forth in Section 5.2 can be
-----------
satisfied, the Borrower may request a Borrowing of Committed Loans to repay
Swing Line Bank pursuant to Section 2.1, or, failing to make such request,
-----------
the Borrower shall be deemed to have requested a Borrowing of Base Rate
Loans on such payment date pursuant to subsection (f) below. Swing Line
Bank shall promptly notify Administrative Agent of each Swing Line Loan and
each payment thereof.
(e) If the Borrower fails to timely make any principal of or interest
payment on any Swing Line Loan, Swing Line Bank shall notify the
Administrative Agent of such fact and the unpaid amount. The Administrative
Agent shall promptly notify each Bank of its Pro Rata Share of such amount
by 8:30 a.m. (San Francisco time). Each Bank shall
36
make funds in an amount equal to its Pro Rata Share of such amount
available to the Administrative Agent at the Administrative Agent's Payment
Office not later than the 11:00 a.m. (San Francisco time) for payments
hereunder on the following Business Day. The obligation of each Bank to
make such payment shall be absolute and unconditional and shall not be
affected by the occurrence of an Event of Default or any other occurrence
or event. Any such payment shall not relieve or otherwise impair the
obligation of the Borrower to repay the Swing Line Bank for any amount of
Swing Line Loans, together with interest as provided herein.
(f) If the conditions precedent set forth in Section 5.2 can be
-----------
satisfied on any date the Borrower is obligated to, but fails to, repay a
Swing Line Loan, the funding by Banks pursuant to the previous subsection
shall be deemed to be a Borrowing of Base Rate Loans (without regard to the
minimum amount therefor) deemed requested by the Borrower. If the
conditions precedent set forth in Section 5.2 cannot be satisfied on the
-----------
date the Borrower is obligated to make, but fails to make, such payment,
the funding by Banks pursuant to the previous subsection shall be deemed to
be a funding by each Bank of its participation in such Swing Line Loan, and
each Bank making such funding shall thereupon acquire a pro rata
participation, to the extent of its payment, in the claim of Swing Line
Bank against the Borrower in respect of such payment and shall share, in
accordance with that pro rata participation, in any payment made by the
Borrower with respect to such claim. Any amounts made available by a Bank
under its risk participation shall be payable by the Borrower upon demand
of Administrative Agent, and shall bear interest at a rate per annum equal
to the Base Rate plus the Applicable Margin plus 2% per annum.
2.8 Reduction of Commitments. Once reduced in accordance with this
------------------------
Section, the Commitments may not be increased. Any reduction of the Commitments
shall be applied to each Bank according to its Pro Rata Share. Reductions in the
Commitments shall be made as follows:
(a) Scheduled Mandatory Reductions. The Borrower shall reduce the
------------------------------
Commitments by $10,000,000 on February 28, 2002; an additional $20,000,000
on August 31, 2002; an additional $15,000,000 on February 28, 2003; and an
additional $15,000,000 on May 31, 2003.
(b) Unscheduled Mandatory Reductions.
--------------------------------
(i) Issuance of Equity. Upon the issuance of any equity in the
------------------
Borrower or any of its Subsidiaries, the Combined Commitments shall be
reduced, in the manner set forth in the UK/US Intercreditor Agreement,
by an aggregate amount equal to 90% of the Net Issuance Proceeds.
37
(ii) Issuance of Indebtedness. Upon the issuance of any Funded
------------------------
Debt, Special Securities or Trust Preferred Securities of the Borrower
or any of its Subsidiaries, the Commitments shall be reduced, in the
manner set forth in the UK/US Intercreditor Agreement, by an aggregate
amount equal to the Net Issuance Proceeds.
(iii) Net Proceeds of Disposition of Assets. Upon the
-------------------------------------
disposition of any assets of the Borrower or any of its Subsidiaries,
except sales of inventory in the ordinary course of business, the
sales of receivables pursuant to the Securitization and dispositions
less than $1,000,000 per disposition, but subject to a $5,000,000
aggregate limit during the term of this Agreement, the Combined
Commitments shall be reduced, in the manner set forth in the UK/US
Intercreditor Agreement by an aggregate amount equal to the Net
Proceeds raised by such disposition. Availability under the
Commitments shall be temporarily restricted by a proportionate share
(equal to the "Pro Rata Share" as defined in the UK/US Intercreditor)
of the estimated tax component of any disposition until the earlier of
nine months or the payment of the Taxes incurred as a direct result of
the disposition. If the Taxes on the disposition are not paid within
nine months of the disposition, the Commitments shall be additionally
reduced by a share of the estimated tax component of the Net Proceeds
from such disposition as required under the UK/US Intercreditor
Agreement. If the actual cash Taxes on any disposition are less than
the estimated tax component of Net Proceeds, the Commitments shall be
reduced by said share of the excess of the estimated tax component
less the actual Taxes.
(c) Voluntary Reductions. The Borrower may, upon not less than five
--------------------
Business Days' prior notice to the Administrative Agent, terminate the
Commitments, or permanently reduce the Commitments by an aggregate minimum of
$5,000,000 or any multiple of $1,000,000 in excess thereof; unless, after giving
effect thereto and to any prepayments of Loans made on the effective date
thereof, the then-outstanding principal amount of Outstanding Obligations would
exceed the amount of the combined Commitments then in effect.
(d) Application of Reductions. Reductions under clauses (b)(i),
-------------------------
(b)(ii) and (c) and the first $40,000,000 of reductions under clause (b)(iii)
shall not reduce the required reductions under clause (a). Any reductions under
clause (b)(iii) in excess of $40,000,000 shall reduce the required reductions
under clause(a) in order of maturities.
2.9 Prepayments.
-----------
(a) Optional Prepayments. Subject to Section 4.4, the Borrower may,
-------------------- -----------
at any time or from time to time, by giving the Administrative Agent
irrevocable notice not later than (i) 8:30 a.m. (San Francisco time) on the
date of the proposed prepayment, in the
38
case of Base Rate Loans and (ii) 8:30 a.m. (San Francisco time) three
Business Days prior to the proposed payment date, in the case of Offshore
Rate Loans, ratably prepay Loans in whole or in part, in amounts equal to
the Minimum Tranche. Such notice of prepayment shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid and the
Applicable Currency. The Administrative Agent will promptly notify each Bank
of its receipt of any such notice, and of such Bank's Pro Rata Share of such
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due
and payable on the date specified therein, together with accrued interest to
each such date on the amount prepaid and any amounts required pursuant to
Section 4.4.
-----------
(b) Mandatory Prepayments.
---------------------
(i) If for any reason the Outstanding Obligations exceed the
aggregate Commitments because of any limitation set forth in this
Agreement or otherwise, the Borrower shall immediately prepay Loans
and/or deposit cash in a Letter of Credit Cash Collateral Account in
an aggregate amount equal to such excess.
(ii) If for a period of five consecutive Business Days, the
Borrower and its Subsidiaries hold in aggregate collected funds in
excess of $10,000,000, the excess thereof on said fifth Business Day
shall be applied as a prepayment to be applied in the manner set forth
in the UK/US Intercreditor Agreement.
2.10 Currency Exchange Fluctuations. If on any Determination Date, the
------------------------------
Administrative Agent shall have determined that the aggregate Dollar Equivalent
principal amount of the Outstanding Obligations then outstanding exceeds the
combined Commitments of the Banks due to a change in applicable rates of
exchange between Dollars and Offshore Currencies, then the Administrative Agent
shall give notice to the Borrower that a prepayment is required under this
Section, and the Borrower agrees thereupon to make prepayments of Loans (and if
all Loans shall be fully paid, deposit cash in a Cash Collateral Account) such
that, after giving effect to such prepayment, the aggregate Dollar Equivalent
amount of all Outstanding Obligations, does not exceed the combined Commitments.
Prepayments of Loans under this Section 2.10 shall be applied (and, to the
------------
extent necessary, made in the Applicable Currency) to repay first, Swing Line
Loans, second Base Rate Loans and third, Offshore Rate Loans. Any prepayment of
an Offshore Rate Loan shall be subject to the provisions of Section 4.4.
-----------
2.11 Repayment.
---------
(a) The Borrower shall repay to the Banks on the Termination Date the
aggregate principal amount of all Loans outstanding on such date.
39
(b) The Borrower shall deposit cash in a Letter of Credit Cash
Collateral Account in the amount of all Letter of Credit Usage on the
Termination Date.
2.12 Interest.
--------
(a) Each Committed Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per
annum equal to the Offshore Rate or the Base Rate, as the case may be, plus
the Applicable Margin (and subject to the Borrower's right to convert to
other Types of Loans under Section 2.4).
-----------
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of
Offshore Rate Loans under Sections 2.8, 2.9 or 2.10 for the portion of the
------------ --- ----
Loans so prepaid and upon payment (including prepayment) in full thereof
and, during the existence of any Event of Default, interest shall be paid
on demand of the Administrative Agent at the request or with the consent of
the Required Banks.
(c) After maturity of any Loan (whether by acceleration or
otherwise), such Loan shall bear interest on the unpaid principal amount
thereof at a rate per annum equal to (i) for any Base Rate Loan the sum of
two percent (2%) plus the Base Rate plus the Applicable Margin from time to
time in effect; and (ii) for any Offshore Rate Loan, the sum of three
percent (3%) plus the rate of interest in effect thereon at the time of
such maturity until the end of the Interest Period applicable thereto and,
thereafter, at a rate per annum equal to the sum of two percent (2%) plus
the Base Rate plus the Applicable Margin from time to time in effect in an
amount equal to the Dollar Equivalent of such Offshore Rate Loan on the
last day of the applicable Interest Period with respect thereto.
2.13 Fees.
----
(a) Agency Fees. The Borrower shall pay an agency fee to the
-----------
Administrative Agent for the Administrative Agent's own account, as
required by the letter agreement ("Fee Letter") between the Borrower, the
----------
Lead Arranger and the Administrative Agent dated May 15, 2001 as
supplemented.
(b) Non-Use Fees. The Borrower shall pay to the Administrative
------------
Agent for the account of each Bank a non-use fee payable on the daily
unused portion of such Bank's Commitment, computed on a quarterly basis
payable in arrears on the last Business Day of each February, May, August
and November commencing May 31, 2001 and on the Termination Date based upon
the daily utilization for that quarter as calculated by the Administrative
Agent, equal to the Applicable Non-Use Fee Rate. For purposes of
calculating the non-use fee, Letter of Credit Usage shall be deemed usage
of the Commitments and Swing Line Loans shall not be deemed usage of the
Commitments.
40
The non-use fees provided in this Section 2.13(b) shall accrue at all times
---------------
after the above-mentioned commencement date, including at any time during which
one or more conditions in Article V are not met.
(c) Amendment Fee. The Borrower shall pay to the Administrative Agent
--------------
for the account of each Bank that signs this Agreement on or before 5:00 p.m.,
Chicago time, May 15, 2001 an amendment fee equal to 0.75% of the aggregate
Commitments, payable in full on the Closing Date.
2.14 Computation of Fees and Interest.
--------------------------------
(a) All computations of interest, when calculated at the "prime
rate", shall be made on the basis of a 365/6 day year and actual days elapsed.
All other computations of fees and interest shall be made on the basis of a 360-
day year and actual days elapsed (which results in more interest being paid than
if computed on the basis of a 365-day year); provided that if the Borrower and
the Administrative Agent mutually determine that a different convention or
practice arises with respect to a particular Offshore Currency in the London
interbank market, computation of interest on Loans denominated in such Offshore
Currency shall be made based on such convention or practice. Interest and fees
shall accrue during each period during which interest or fees are computed from
the first day thereof to the last day thereof.
(b) For purposes of determining utilization of each Bank's Commitment
in order to calculate the non-use fee due under Section 2.13, the amount of any
------------
outstanding Offshore Currency Loans and the Letter of Credit Usage on any date
shall be determined based upon the Dollar Equivalent amount as of the most
recent Determination Date with respect to such Offshore Currency Loans and the
Letter of Credit Usage.
(c) Each determination of an interest rate or a Dollar Equivalent
amount by the Administrative Agent shall be conclusive and binding on the
Borrower and the Banks in the absence of manifest error.
2.15 Payments by the Borrower
------------------------
(a) All payments to be made by the Borrower shall be made without
set-off, deduction, recoupment or counterclaim. Except as otherwise expressly
provided herein, all payments by the Borrower shall be made to the
Administrative Agent for the account of the Banks at the Administrative Agent's
Payment Office, and, with respect to principal of, interest on, and any other
amounts relating to, any Offshore Currency Loan, shall be made in the Offshore
Currency in which such Loan is denominated or payable, and, with respect to all
other amounts payable hereunder, shall be made in Dollars. Such payments shall
be made in Same Day Funds, and (i) in the case of Offshore Currency payments, no
41
later than such time on the dates specified herein as may be determined by the
Administrative Agent to be necessary for such payment to be credited on such
date in accordance with normal banking procedures in the place of payment, and
(ii) in the case of any Dollar payments, no later than 12:00 p.m. (San Francisco
time) on the date specified herein. The Administrative Agent will promptly
distribute to each Bank its Pro Rata Share (or other applicable share as
expressly provided herein) of such principal, interest, fees or other amounts,
in like funds as received. Any payment which is received by the Administrative
Agent later than 12:00 p.m. (San Francisco time), or later than the time
specified by the Administrative Agent as provided in clause (i) above (in the
case of Offshore Currency payments), shall be deemed to have been received on
the following Business Day and any applicable interest or fee shall continue to
accrue.
(b) Subject to the provisions set forth in the definition of "Interest
Period" herein, whenever any payment is due on a day other than a Business Day,
such payment shall be made on the following Business Day, and such extension of
time shall in such case be included in the computation of interest or fees, as
the case may be.
(c) Unless the Administrative Agent receives notice from the Borrower
prior to the date on which any payment is due to the Banks that the Borrower
will not make such payment in full as and when required, the Administrative
Agent may assume that the Borrower has made such payment in full to the
Administrative Agent on such date in immediately available funds and the
Administrative Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Bank on such due date an amount equal to the
amount then due such Bank. If and to the extent the Borrower has not made such
payment in full to the Administrative Agent, each Bank shall repay to the
Administrative Agent on demand such amount distributed to such Bank, together
with interest thereon at the Federal Funds Rate in the case of Dollars and the
Overnight Rate in the case of any other Applicable Currency for each day from
the date such amount is distributed to such Bank until the date repaid.
2.16 Payments by the Banks to the Administrative Agent.
-------------------------------------------------
(a) Unless the Administrative Agent receives notice from a Bank on or
prior to the Closing Date or, with respect to any Borrowing after the Closing
Date, at least one Business Day prior to the date of such Borrowing, that such
Bank will not make available as and when required hereunder to the
Administrative Agent for the account of the Borrower the amount of that Bank's
Pro Rata Share of the Borrowing, the Administrative Agent may assume that each
Bank has made such amount available to the Administrative Agent in immediately
available funds on the Borrowing Date and the Administrative Agent may (but
shall not be so required), in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent any Bank
shall not have made its full amount available to the Administrative Agent in
42
immediately available funds and the Administrative Agent in such
circumstances has made available to the Borrower such amount, that Bank
shall on the Business Day following such Borrowing Date make such amount
available to the Administrative Agent, together with interest at the
Federal Funds Rate in the case of Dollars and the Overnight Rate in the
case of any other Applicable Currency for each day during such period. A
notice of the Administrative Agent submitted to any Bank with respect to
amounts owing under this Section 2.16(a) shall be conclusive, absent
---------------
manifest error. If such amount is so made available, such payment to the
Administrative Agent shall constitute such Bank's Committed Loan on the
date of Borrowing for all purposes of this Agreement. If such amount is not
made available to the Administrative Agent on the Business Day following
the Borrowing Date, the Administrative Agent will notify the Borrower of
such failure to fund and, upon demand by the Administrative Agent, the
Borrower shall pay such amount to the Administrative Agent for the
Administrative Agent's account, together with interest thereon for each day
elapsed since the date of such Borrowing, at a rate per annum equal to the
interest rate applicable at the time to the Committed Loans comprising such
Borrowing.
(b) The failure of any Bank to make any Committed Loan or on any
Borrowing Date shall not relieve any other Bank of any obligation hereunder
to make a Committed Loan on such Borrowing Date, but no Bank shall be
responsible for the failure of any other Bank to make the Committed Loan to
be made by such other Bank on any Borrowing Date.
2.17 Sharing of Payments, Etc. If, other than as expressly provided
------------------------
elsewhere herein, any Bank shall obtain on account of the Committed Loans or
Letter of Credit Usage made by it any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) in excess of its Pro
Rata Share, such Bank shall immediately (a) notify the Administrative Agent of
such fact, and (b) purchase from the other Banks such participations in the
Committed Loans or Letter of Credit Usage made by them as shall be necessary to
cause such purchasing Bank to share the excess payment pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
-------- -------
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Borrower agrees
that any Bank so purchasing a participation from another Bank may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 10.11) with respect to such
-------------
participation as fully as if such Bank were the direct creditor of the Borrower
in the amount of such participation. The Administrative Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
43
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments.
2.18 Warrants. Warrants, subject to the Warrant Agreement, shall be
--------
delivered to each Bank, representing a proportionate share (equal to its
Commitment on the dated hereof divided by the Combined Commitments on the date
hereof) of 5% of the fully diluted common stock of the Borrower. The exercise
price shall be the closing price as of May 9, 2001, subject to customary
antidilution provisions. Pursuant to the Warrant Agreement, the number of
Warrant Shares (as defined in the Warrant Agreement) shall be reduced by half if
the Combined Commitments are reduced by $320 million by August 30, 2002.
ARTICLE III
GUARANTY AND COLLATERAL
-----------------------
3.1 Guaranties.
----------
(a) Obligations of the Borrower. All obligations of the Borrower
---------------------------
shall be guaranteed by the Guarantors.
(b) Required Guaranties. All Domestic Subsidiaries of APW, Ltd.,
-------------------
other than Applied Power Credit Corporation and any of the Dissolution
Subsidiaries, shall provide or reaffirm existing guaranties. All
Dissolution Subsidiaries not dissolved within 90 days of the closing of
this amendment shall provide guaranties. Subject to Section 3.1(c), the
--------------
Borrower shall, at the request of the Administrative Agent or the Required
Banks, cause each of its Subsidiaries required to guarantee its Obligations
pursuant to Section 3.1(a), which shall not previously have delivered a
Guaranty to execute and deliver such guaranties and deliver such evidence
of authority, correctness of signatures and opinions of counsel as the
Administrative Agent or the Required Banks may from time to time reasonably
request. Notwithstanding the foregoing, the Administrative Agent shall not
request, and the Borrower shall not cause, Applied Power Credit Corporation
to guaranty the Obligations of the Borrower and the Borrower may designate
Foreign Subsidiaries not to be Guarantors, so long as at no time shall the
combined assets of such Foreign Subsidiaries (excluding stock of
Guarantors) exceed $100,000,000 and so long as, except as otherwise
provided herein, the Borrower has used its commercially reasonable best
efforts to provide Guarantees from all Subsidiaries located in Brazil,
Germany, the United Kingdom, Ireland and Denmark. The Administrative Agent
is authorized to release any Guaranty of a Dissolution Subsidiary, upon its
dissolution.
(c) Action with Non Guarantors.
--------------------------
44
(i) Neither the Borrower nor any Guarantor shall purchase or
acquire, or make any commitment therefor, any capital stock, equity
interest or other securities of, or any interest in, any existing
Affiliate (other than a Guarantor), or make or commit to make any
capital contribution to, or any investment in, any existing Affiliate
(other than a Guarantor).
(ii) Neither the Borrower nor any Guarantor shall make any
loan, advance, extension of credit or transfer or sell any assets to
any Affiliate (other than the Borrower or a Guarantor), other than
loans, advances or extensions of credit not exceeding $5,000,000 at
any time outstanding.
(iii) No Guarantor shall declare or make any dividend payment
or other distribution of assets, properties, cash, rights, obligations
or securities on account of any shares of any class of its capital
stock, or purchase, redeem, or otherwise acquire for value any shares
of its capital stock or any warrants, rights or options to acquire
such shares, now or hereafter outstanding, unless all such payments or
distributions are made directly or indirectly to the Borrower or
Guarantor (it being understood that a payment or distribution is made
indirectly to the Borrower or Guarantor if all the proceeds thereof
are in fact received by the Borrower or Guarantor).
(iv) Neither the Borrower nor any Guarantor shall make any
payments on Debt to any Affiliate other than payments directly or
indirectly to the Borrower or Guarantor (it being understood that a
payment is made indirectly to the Borrower or Guarantor if all the
proceeds thereof are in fact received by the Borrower or Guarantor)
other than payments not in excess of $5,000,000 in any Fiscal Year.
3.2 Collateral Documents. Concurrently with or prior to the Closing Date:
--------------------
(a) Pledge Agreement. The Borrower shall execute and deliver and
----------------
cause each of its Domestic Subsidiaries to execute and deliver to the
Administrative Agent, for the benefit of the Banks, the Pledge Agreement, and
shall deliver to the Administrative Agent all stock certificates pledged
pursuant thereto and all related stock powers in blank.
(b) Security Agreement. The Borrower shall execute and deliver and
------------------
cause each of its Domestic Subsidiaries to execute and deliver to the
Administrative Agent for the benefit of the Banks, the Security Agreement,
together with such financing statements and other documents as the
Administrative Agent may reasonably require.
(c) Assignment of Security Interest in United States Trademarks and
---------------------------------------------------------------
Patents. The Borrower shall execute and deliver and cause each of its Domestic
-------
Subsidiaries to execute
45
and deliver to the Administrative Agent for the benefit of the Banks the
Assignment of Security Interest in United States Trademarks and Patents.
(d) Debenture. Subject to clause(e), the Borrower shall execute and
---------
deliver on the Closing Date and cause each of its UK Subsidiaries (other than
Dissolution Subsidiaries) to execute and deliver to the Administrative Agent for
the benefit of the Banks the Debenture.
(e) Subsidiaries Not Delivering Collateral. Notwithstanding the
--------------------------------------
foregoing, the Subsidiaries listed in the attached Schedule 3.2(e) shall not be
required to deliver Collateral Documents.
3.3 Real Estate. Within 90 days after the date hereof, the Borrower shall
-----------
provide a first priority Lien and shall cause each Subsidiary that is a
Guarantor to provide a first priority Lien with respect to real property within
the United States, Canada, Brazil, Germany, the United Kingdom, Ireland and
Denmark, (i) all owned property and (ii) all leased property with square footage
greater than 100,000 square feet (to the extent the Borrower or Guarantor is
permitted to grant a security interest in the property under the respective
lease).
The Borrower shall, and shall cause each Guarantor to cause, all mortgages,
deeds of trust, or charges, as required by the Administrative Agent, to be
recorded in the appropriate real estate records within 90 days of the Closing
Date; provided, however, that if the Borrower or Guarantor is in good faith and
diligently pursuing such perfection, the Administrative Agent, in its sole
discretion, may grant the Borrower or such Guarantor an additional 30 days with
respect thereto. Notwithstanding the foregoing, to the extent the
Administrative Agent shall determine, in its sole discretion, that the provision
of any Lien is not cost effective, is not practicable or is otherwise
detrimental to the Banks, it may waive the requirement of the granting of such
Lien.
3.4 Foreign Subsidiaries. Within 60 days after the date hereof, the
--------------------
Borrower shall cause all Foreign Subsidiaries that are Guarantors (other than UK
Subsidiaries which shall have previously delivered a Debenture) to grant a first
priority Lien on its personal property interests with respect to all personal
property within Canada, Brazil, Germany, the United Kingdom, Ireland or Denmark
and to deliver all documentation necessary to perfect such Lien in form
satisfactory to the Administrative Agent; provided, however, that if the
Borrower or Guarantor is in good faith and diligently pursuing such perfection,
the Administrative Agent, in its sole discretion, may grant the Borrower or such
Guarantor an additional 30 days with respect thereto. Notwithstanding the
foregoing, to the extent the Administrative Agent shall determine, in its sole
discretion, that the provision of any Lien is not cost effective, is not
practicable or is otherwise detrimental to the Banks, it may waive the
requirement of the granting of such Lien.
3.5 Application of Proceeds from Collateral. Any proceeds of the Shared
---------------------------------------
Collateral shall be applied in accordance with the UK/US Intercreditor
Agreement. All proceeds received
46
by the Administrative Agent from the sale or disposition of any of the
Collateral shall be applied by the Administrative Agent in the following order
after receipt thereof:
First: to the payment of all of the reasonable costs and
-----
expenses of the Administrative Agent in connection with (a) the
administration, sale or disposition of such Collateral, and (b) the
administration and enforcement of this Agreement and the other Loan
Documents, to the extent that such costs and expenses shall not have
been reimbursed to the Administrative Agent and relate to the
Obligations;
Second: to the payment in full of all accrued and unpaid
------
interest and fees on the Loans and then to the payment in full of all
unpaid principal of the Loans;
Third: the balance, if any, of such proceeds shall be paid to
-----
the Borrower, to the Borrower's assigns, or as a court of competent
jurisdiction may direct.
3.6 Further Assurances. If any Guaranty delivered pursuant to this
------------------
Article III is limited in amount and if the applicable Guarantor would be
-----------
legally permitted to deliver a Guaranty in a greater amount (or in an unlimited
amount), at the request of the Administrative Agent or the Required Banks, it
will deliver a replacement Guaranty, evidences of authority, evidences of
correctness of signatures and opinions of counsel reasonably satisfactory to the
Administrative Agent. The Borrower agrees that upon request of the
Administrative Agent (a) the Borrower shall promptly deliver or cause to be
delivered to the Administrative Agent, in due form for transfer, all chattel
paper, instruments, securities and documents of title, if any, at any time
representing all or any of the Collateral, and (b) the Borrower shall forthwith
execute and deliver or cause to be executed and delivered to the Administrative
Agent, in due form for filing or recording (and pay the cost of filing or
recording the same in all public offices deemed necessary by the Administrative
Agent), such further assignment agreements, security agreements, pledge
agreements, instruments, consents, waivers, financing statements, stock or bond
powers, searches, releases, and other documents, and do such other acts and
things, all as the Administrative Agent may from time to time reasonably request
to establish and maintain to the satisfaction of the Administrative Agent a
valid perfected Lien on all Collateral (free of all other Liens except those
permitted pursuant to Section 7.9 hereof) to secure payment of the Outstanding
-----------
Obligations. If at any time a Subsidiary required to be a Guarantor shall not
be a Guarantor or any Guarantor shall not have delivered the Collateral
Documents required hereunder, such Subsidiary shall take all action reasonably
required by the Administrative Agent to become a Guarantor and to provide
Collateral.
3.7 Transfer of Assets. The Borrower shall not, and shall not permit, any
------------------
Subsidiary, to sell, lease or transfer assets in which the Administrative Agent
has a perfected security interest to the Borrower, a Subsidiary or an Affiliate,
if the effect is to cause the Administrative Agent to no longer have a valid
first priority perfected security interest.
47
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
--------------------------------------
4.1 Taxes.
-----
(a) Any and all payments by the Borrower to each Bank or the
Administrative Agent under this Agreement and any other Loan Document shall be
made free and clear of, and without deduction or withholding for, any Taxes. In
addition, the Borrower shall pay all Other Taxes and Further Taxes.
(b) If the Borrower shall be required by law to deduct or withhold
any Taxes, Other Taxes or Further Taxes from or in respect of any sum payable
hereunder to any Bank or the Administrative Agent, then:
(i) the sum payable shall be increased as necessary so that,
after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section) such Bank or the Administrative Agent, as the case
may be, receives and retains an amount equal to the sum it would have
received and retained had no such deductions or withholdings been
made;
(ii) the Borrower shall make such deductions and withholdings;
(iii) the Borrower shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Borrower shall also pay to each Bank or the
Administrative Agent for the account of such Bank, at the time
interest is paid, Further Taxes in an amount that the respective Bank
specifies as necessary to preserve the after-tax yield the Bank would
have received if such Taxes, Other Taxes or Further Taxes had not been
imposed.
(c) The Borrower agrees to indemnify and hold harmless each Bank and
the Administrative Agent for the full amount of (i) Taxes, (ii) Other
Taxes, and (iii) Further Taxes in the amount that the respective Bank
reasonably specifies as necessary to preserve the after-tax yield such Bank
would have received if such Taxes, Other Taxes or Further Taxes had not
been imposed, and any liability (including penalties, interest, additions
to tax and expenses) arising therefrom or with respect thereto, whether or
not such Taxes, Other Taxes or Further Taxes were correctly or legally
asserted. Payment
48
under this indemnification shall be made within 30 days after the date a
Bank or the Administrative Agent makes written demand therefor.
(d) Within 30 days after the date of any payment by the Borrower of
Taxes, Other Taxes or Further Taxes, the Borrower shall furnish to each
Bank or the Administrative Agent the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment
satisfactory to such Bank or the Administrative Agent.
(e) If the Borrower is required to pay additional amounts to any Bank
or the Administrative Agent pursuant to Section 4.1(b) or (c) then such
-------------- ---
Bank shall use reasonable efforts (consistent with legal and regulatory
restrictions) to change the jurisdiction of its Lending Office so as to
eliminate any such additional payment by the Borrower which may thereafter
accrue, if such change in the sole judgment of such Bank is not otherwise
disadvantageous to such Bank.
4.2 Illegality.
----------
(a) If any Bank determines that the introduction of any Requirement
of Law, or any change in any Requirement of Law, or in the interpretation
or administration of any Requirement of Law, has made it unlawful, or that
any central bank or other Governmental Authority has asserted that it is
unlawful, for any Bank or its applicable Lending Office to make Offshore
Rate Loans (including Offshore Rate Loans in any Applicable Currency),
then, on notice thereof by the Bank to the Borrower through the
Administrative Agent, any obligation of that Bank to make Offshore Rate
Loans shall be suspended until the Bank notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination
no longer exist.
(b) If a Bank determines that it is unlawful to maintain any Offshore
Rate Loan, the Borrower shall, upon its receipt of notice of such fact and
demand from such Bank (with a copy to the Administrative Agent), prepay in
full such Offshore Rate Loans of that Bank then outstanding, together with
interest accrued thereon and amounts required under Section 4.4, either on
-----------
the last day of the Interest Period thereof, if the Bank may lawfully
continue to maintain such Offshore Rate Loans to such day, or immediately,
if the Bank may not lawfully continue to maintain such Offshore Rate Loan.
If the Borrower is required to so prepay any Offshore Rate Loan, then
concurrently with such prepayment, the Borrower shall borrow from the
affected Bank, in the Dollar Equivalent amount of such repayment, a Base
Rate Loan.
(c) If the obligation of any Bank to make or maintain Offshore Rate
Loans has been so terminated or suspended, the Borrower may elect, by
giving notice to the Bank
49
through the Administrative Agent that all Loans which would otherwise be
made by the Bank as Offshore Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Administrative Agent under this
Section, the affected Bank shall designate a different Lending Office with
respect to its Offshore Rate Loans if such designation will avoid the need
for giving such notice or making such demand and will not, in the judgment
of the Bank, be illegal or otherwise disadvantageous to the Bank.
4.3 Increased Costs and Reduction of Return.
---------------------------------------
(a) If any Bank determines that, due to either (i) the introduction
of or any change in or in the interpretation of any law or regulation after
the date hereof or (ii) the compliance by that Bank with any guideline or
request from any central bank or other Governmental Authority after the
date hereof (whether or not having the force of law), there shall be any
increase in the cost to such Bank of agreeing to make or making, funding or
maintaining any Offshore Rate Loans, then the Borrower shall be liable for,
and shall from time to time, within 10 days after demand (with a copy of
such demand to be sent to the Administrative Agent), pay to the
Administrative Agent for the account of such Bank, additional amounts as
are sufficient to compensate such Bank for such increased costs.
(b) If any Bank shall have determined that (i) the introduction after
the date hereof of any Capital Adequacy Regulation, (ii) any change after
the date hereof in any Capital Adequacy Regulation, (iii) any change after
the Closing Date in the interpretation or administration of any Capital
Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv)
compliance by such Bank (or its Lending Office) or any corporation
controlling the Bank with any Capital Adequacy Regulation adopted after the
Closing Date, affects or would affect the amount of capital required or
expected to be maintained by such Bank or any corporation controlling such
Bank and (taking into consideration such Bank's or such corporation's
policies with respect to capital adequacy and such Bank's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitment, loans, credits or obligations under this
Agreement, then, upon demand of such Bank to the Borrower through the
Administrative Agent, the Borrower shall pay to the Bank, from time to time
as specified by the Bank, additional amounts sufficient to compensate the
Bank for such increase.
4.4 Funding Losses. The Borrower shall reimburse each Bank and hold each
--------------
Bank harmless from any loss or expense which the Bank may sustain or incur as a
consequence of:
50
(a) the failure of the Borrower to make on a timely basis any payment
of principal of any Offshore Rate Loan;
(b) the failure of the Borrower to borrow, continue or convert a Loan
after the Borrower has given (or are deemed to have given) a Notice of
Borrowing or a Notice of Conversion/Continuation;
(c) the failure of the Borrower to make any prepayment of any Loan in
accordance with any notice delivered under Section 2.9;
-----------
(d) the prepayment (including pursuant to Sections 2.8, 2.9 or 2.10)
------------ --- ----
or other payment (including after acceleration thereof) of any Offshore
Rate Loan on a day that is not the last day of the relevant Interest
Period; or
(e) the automatic conversion under Section 2.4 of any Offshore Rate
-----------
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained.
4.5 Inability to Determine Rates. If the Required Banks determine that
----------------------------
for any reason adequate and reasonable means do not exist for determining the
Offshore Rate for any requested Interest Period with respect to a proposed
Offshore Rate Loan, or that the Offshore Rate for any requested Interest Period
with respect to a proposed Offshore Rate Loan does not adequately and fairly
reflect the cost to such Banks of funding such Loan, the Administrative Agent
will promptly so notify the Borrower and each Bank. Thereafter, the obligation
of the Banks to make or maintain Offshore Rate Loans hereunder shall be
suspended until the Administrative Agent upon the instruction of the Required
Banks revokes such notice in writing. Upon receipt of such notice, the Borrower
may revoke any Notice of Borrowing or Notice of Conversion/Continuation then
submitted by it. If the Borrower does not revoke such Notice, the Banks shall
make, convert or continue the Loans, as proposed by the Borrower, in the amount
specified in the applicable notice submitted by the Borrower, but such Loans
shall be made, converted or continued as Base Rate Loans instead of Offshore
Rate Loans. In the case of any Offshore Currency Loans, the Borrowing or
continuation shall be in an aggregate amount equal to the Dollar Equivalent
amount in Dollars of the originally requested Borrowing or continuation in the
Offshore Currency, and to that end any outstanding Offshore Currency Loans which
are the subject of any continuation shall be redenominated and converted into
Base Rate Loans in Dollars with effect from the last day of the Interest Period
with respect to any such Offshore Currency Loans.
4.6 Certificates of Banks. Any Bank claiming reimbursement or
---------------------
compensation under this Article IV shall deliver to the Borrower (with a copy to
the Administrative Agent) a
51
certificate setting forth in reasonable detail the amount payable to such Bank
hereunder and such certificate shall be conclusive and binding on the Borrower
in the absence of manifest error. In determining the amount payable to the Bank
pursuant to this Article IV, each Bank shall act reasonably and in good faith
and will, to the extent the increased costs or reductions in amounts received or
receivable relate to such Bank's loans in general (including the Loans) and are
not specifically attributable to the Loans and other amounts due hereunder, use
averaging and attribution methods which are reasonable and which cover all loans
similar to the Loans made by such Bank.
4.7 Substitution of Banks. Upon the receipt by the Borrower from any Bank
---------------------
(an "Affected Bank") of a claim for compensation under Section 4.1, 4.2 or 4.3,
------------- ----------- --- ---
the Borrower may: (i) request the Affected Bank to cooperate with the Borrower
in its efforts to obtain a replacement bank or financial institution
satisfactory to the Borrower to acquire and assume all or a ratable part of all
of such Affected Bank's Loans and Commitment (a "Replacement Bank"); (ii)
----------------
request one more of the other Banks to acquire and assume all or part of such
Affected Bank's Loans and Commitment; or (iii) designate a Replacement Bank.
Any such designation of a Replacement Bank under clause (i) or (iii) shall be
subject to the prior written consent of the Administrative Agent (which consent
shall not be unreasonably withheld).
4.8 Survival. The agreements and obligations of the Borrower in this
--------
Article IV shall survive the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
--------------------
5.1 Conditions to Effectiveness of Amendment and Restatement. The
--------------------------------------------------------
effectiveness of this amendment and restatement of the Existing Credit Agreement
is subject to the condition that the Administrative Agent have received on or
before the Closing Date all of the following, in form and substance satisfactory
to the Administrative Agent, and in sufficient copies for each Bank:
(a) Amended and Restated Multicurrency Credit Agreement. This
---------------------------------------------------
Agreement executed by the Borrower, the Administrative Agent and the
Required Banks.
(b) Warrant Agreement. The warrant agreement in the form attached as
-----------------
Exhibit E.
(c) Reaffirmation of Guaranties. A reaffirmation of each of the
---------------------------
Existing Guaranties by each applicable Guarantor in the form attached as
Exhibit J.
52
(d) Guaranties. The Guaranties executed by each additional Guarantor
----------
as required herein.
(e) Securitization Intercreditor Agreement. An intercreditor
--------------------------------------
agreement between the Banks and Societe Generale in the form attached as
Exhibit K and an amendment to the Securitization in the form attached as
Exhibit N, including among other things an extension to May 14, 2002.
(f) Debenture. The Debenture executed by the UK Subsidiaries, in
---------
proper form for filing.
(g) UK/US Intercreditor Agreement. The US/UK Intercreditor Agreement
-----------------------------
and amendments to the UK Credit Agreement, as defined therein, in the form
attached as Exhibit O, including, among other things, an extension to July
31, 2003.
(h) Security Agreement. The Security Agreement, together with such
------------------
financing statements and other documents as the Administrative Agent may
require.
(i) Pledge Agreement. The Pledge Agreement together with such stock
----------------
certificates, blank stock powers and other documents on the Administrative
Agent may require.
(j) Assignment of Security Interest in United States Patents and
------------------------------------------------------------
Trademarks. An executed assignment of a security interest in United States
----------
patents and trademarks in a form recordable with the United States Patent
and Trademark Office.
(k) Resolutions -- Borrower. Certified copies of resolutions of the
-----------------------
Board of Directors of the Borrower authorizing or ratifying the execution,
delivery and performance by the Borrower of this Agreement and the other
documents provided for in this Agreement to be executed by the Borrower.
(l) Incumbency and Signatures. A certificate of the Secretary, an
-------------------------
Assistant Secretary or a comparable officer of the Borrower certifying the
names of the officer, officers or other authorized representatives of the
Borrower authorized to sign this Agreement and the other documents provided
for in this Agreement to be executed by the Borrower, together with a
sample of the true signature of each such officer or authorized
representative (it being understood that the Administrative Agent and each
Bank may conclusively rely on such certificate until formally advised by a
like certificate of any changes therein).
(m) Resolutions. With respect to the Guaranties other than Existing
-----------
Guaranties, certified copies of resolutions of the Board of Directors of
each Guarantor
53
authorizing or ratifying the execution, delivery and performance by such
Guarantor of its Guaranty and the other documents provided for in this
Agreement to be executed by such Guarantor.
(n) Incumbency and Signatures. With respect to Guaranties other than
-------------------------
Existing Guaranties, a certificate of the Secretary, an Assistant Secretary
or a comparable officer of each Guarantor certifying the names of the
officer, officers or other authorized representatives of such Guarantor
authorized to sign the documents provided for in this Agreement to be
executed by such Guarantor, together with a sample of the true signature of
each such officer or authorized representative (it being understood that
the Administrative Agent and each Bank may conclusively rely on such
certificate until formally advised by a like certificate of any changes
therein).
(o) Opinions of Counsel for the Borrower and the Guarantors. The
-------------------------------------------------------
opinions of counsel to the Borrower and the Guarantors in the forms of
Exhibit D, D-1 and D-2 .
--------- --- ---
(p) Closing Compliance Certificate. A certificate of the Borrower
------------------------------
evidencing the Borrower is in compliance with the provisions of this
Agreement, including on a pro forma basis with the provisions of Section
-------
7.6.
---
(q) Payment of Fees. Evidence of payment by the Borrower of all
---------------
accrued and unpaid fees, costs and expenses to the extent then due and
payable on the Closing Date, together with Attorney Costs of Bank of
America to the extent invoiced prior to or on the Closing Date, and fees
and expenses of the Administrative Agent's Consultant including such
additional amounts as shall be necessary to ensure any such costs, fees and
expenses arising under or referenced in Sections 2.13 and 10.5 plus
------------- ----
$150,000 to the Administrative Agents's Consultant and $150,000 to Xxxxx,
Xxxxx & Xxxxx on retainer for further fees and expenses.
(r) Other Documents. Such other approvals, opinions, documents or
---------------
materials as the Administrative Agent or any Bank may request.
Notwithstanding the foregoing, the Administrative Agent may, in its sole
discretion, waive any conditions precedent (other than as set forth in
clause(g)) for up to one week, it being agreed that the failure to then deliver
within such one week shall constitute an Event of Default, unless waived by the
Required Banks.
5.2 Conditions to All Borrowings and Letters of Credit. The obligation of
--------------------------------------------------
each Bank to make any Loan to be made by it and of the Issuing Bank to take any
Letter of Credit Action is subject to the satisfaction of the following
conditions precedent on the relevant Borrowing Date or Letter of Credit Action
Date:
54
(a) Notice of Borrowing or Letter of Credit Application. The
---------------------------------------------------
Administrative Agent shall have received a Notice of Borrowing or Letter of
Credit Application.
(b) Continuation of Representations and Warranties. Before and after
----------------------------------------------
giving effect to the proposed Loan or Letter of Credit Action and the
application of proceeds thereof, the representations and warranties in
Article VI (excluding, except in the case of the initial Loan or Letter of
Credit hereunder, Sections 6.6 and 6.8) shall be true and correct on and as
------------ ---
of such Borrowing Date or Letter of Credit Action Date with the same effect
as if made on and as of such Borrowing Date or Letter of Credit Action
Date.
(c) No Existing Default. No Default or Event of Default shall exist
-------------------
or shall result from such Borrowing or Letter of Credit Action.
(d) Free Cash. The Borrower shall represent that, to the best of its
---------
knowledge after due inquiry, after giving effect to a proposed Loan and the
application of proceeds thereof, within two Business Days of making such
Loan, the Borrower and its Subsidiaries shall not hold aggregate collected
funds in excess of $10,000,000.
Each Notice of Borrowing and Letter of Credit Application submitted by the
Borrower hereunder shall constitute a representation and warranty by the
Borrower hereunder, as of the date of each such notice or request and as of each
Borrowing Date that the conditions in Sections 5.2 (b), (c) and (d) satisfied.
---------------- --- ---
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Banks to enter into this Agreement and to make Loans
hereunder and take Letter of Credit Actions, the Borrower represents and
warrants to the Administrative Agent and the Banks as follows:
6.1 Organization, etc. Each of the Borrower and its Subsidiaries is a
-----------------
corporation, limited liability company or limited partnership duly organized,
validly existing and in good standing (or similar concept under applicable law)
under the laws of the jurisdiction of its organization. Each of the Borrower
and each of its Subsidiaries is duly qualified to do business, and is in good
standing, in all other jurisdictions where failure to so qualify would have a
Material Adverse Effect. Each of the Borrower and each of its Subsidiaries has
all requisite corporate power, limited liability company power or limited
partnership power, as applicable, to own or lease the properties used in its
business and to carry on its business as now being conducted. Each of the
Borrower and each of its Subsidiaries has full power and authority to
55
conduct its business as proposed to be conducted, and to execute and deliver the
Loan Documents to which it is a party and to engage in the transactions
contemplated thereby.
6.2 Authorization; No Conflict. The execution and delivery of this
--------------------------
Agreement, the borrowings and incurrence of the other Obligations hereunder, the
execution and delivery of the other Loan Documents, and the performance by each
Loan Party of its obligations under each Loan Document to which it is a party
are within each of the Loan Party's powers, have been duly authorized by all
necessary action, have received all necessary governmental and regulatory
approval, and do not and will not contravene or conflict with, or result in the
creation or imposition of a lien under, any provision of law or of the charter
or by-laws or similar documents of such Loan Party or of any agreement,
instrument, order or decree that is binding upon such Loan Party.
6.3 Validity and Binding Nature. Each Loan Document to which it is a
---------------------------
party constitutes the legal, valid, and binding obligations of each Loan Party
enforceable against such Loan Party in accordance with its respective terms,
except to the extent enforceability thereof is limited by bankruptcy, insolvency
or other laws relating to, or affecting the enforcement of, creditors' rights in
general, and by general principles of equity.
6.4 Financial Statements.
--------------------
(a) All balance sheets, all statements of earnings, stockholders'
equity and cash flow, and all other financial information which have been
furnished by or on behalf of the Borrower to the Bank, including (i) the
audited consolidated balance sheet at August 31, 2000 and the related
audited consolidated statements of earnings, stock holders' equity and
cash flow, for the Fiscal Year then ended, of the Borrower and its
Subsidiaries, certified by PriceWaterhouse Coopers and (ii) the unaudited
consolidated balance sheet dated February 28, 2001 and the related
unaudited consolidated statements of earnings and cash flow, for the Fiscal
Quarter then ended, of the Borrower and its Subsidiaries, as appearing in
the report on Form 10-Q for such Fiscal Quarter filed by the Borrower with
the U.S. Securities and Exchange Commission, have been prepared in
accordance with GAAP consistently applied, except where not applicable
thereto or as otherwise disclosed therein, throughout the periods involved
and present fairly (subject to normal year-end adjustments, if applicable)
the financial condition of the Borrower and its Subsidiaries as at the
dates thereof and the results of their operations for the periods then
ended. The Borrower and its Subsidiaries did not have as of such dates any
material contingent liability or liabilities for taxes, long-term leases or
unusual forward or long-term commitments which are not reflected in the
financial statements described above, and which, in accordance with GAAP,
should have been reflected in such financial statements.
56
(b) With respect to any representation and warranty which is deemed
to be made after the date hereof by the Borrower, the balance sheet and
statements of earnings, shareholders' equity and cash flow, which as of
such date shall most recently have been furnished by or on behalf of the
Borrower to the Banks for the purposes of or in connection with this
Agreement shall have been prepared in accordance with GAAP consistently
applied (except as disclosed therein), and shall present fairly the
consolidated financial condition of the corporations covered thereby as at
the dates thereof for the periods then ended, subject, in the case of
quarterly financial statements, to normal year-end audit adjustments.
6.5 No Material Adverse Effect. No event has occurred or condition has
--------------------------
arisen that has had or is reasonably likely to have a Material Adverse Effect
since February 28, 2001, with respect to the Borrower and its Subsidiaries,
except as described in Item 6.5 of the Disclosure Schedule.
--------
6.6 Litigation and Contingent Liabilities. To the best of the Borrower's
-------------------------------------
knowledge, no litigation (including, without limitation, derivative actions),
arbitration proceedings or governmental or regulatory proceedings are pending or
threatened against the Borrower or any Subsidiary of the Borrower that would, if
adversely determined, be reasonably likely to have a Material Adverse Effect,
except as set forth in Item 6.6 of the Disclosure Schedule. Other than any
--------
liability incident to such litigation or proceedings, neither the Borrower nor
any Subsidiary has any contingent liabilities, except as provided for or
disclosed in the financial statements referred to in Section 6.4, which would if
-----------
adversely determined be reasonably likely to have a Material Adverse Effect.
6.7 Liens. None of the assets of the Borrower or any of its Subsidiaries
-----
is subject to any Lien, except as permitted by Section 7.9.
-----------
6.8 Subsidiaries. Item 6.8 of the Disclosure Schedule correctly sets
------------ --------
forth the name, jurisdiction of organization, and ownership of each Subsidiary
of the Borrower. Such Subsidiaries and each Person becoming a Subsidiary of the
Borrower after the date hereof is and will be a corporation, limited liability
company or limited partnership duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and each Subsidiary
of the Borrower is and will be duly qualified to do business in each other
jurisdiction where failure to so qualify would have a Material Adverse Effect.
6.9 Pension and Welfare Plans. During the twelve-consecutive-month period
-------------------------
prior to the date of the execution and delivery of this Agreement or the making
of any Loan hereunder, no steps have been taken to terminate any Pension Plan,
and no contribution failure has occurred with respect to any Pension Plan
sufficient to give rise to a lien under Section 302(f) of ERISA. No condition
exists or event or transaction has occurred with respect to any Pension Plan
which could result in the incurrence by the Borrower or any of it Subsidiaries
of any material liability,
57
fine or penalty. Except as set forth in the pension and welfare plan footnote in
the audited financial statements referred to in Section 6.4(a), neither the
--------------
Borrower nor any of the Subsidiaries have any contingent liability with respect
to any post-retirement benefit under a Welfare Plan, other than liability for
continuation coverage described in Part 6 of subtitle B of title I of ERISA.
6.10 Regulated Industry. Neither the Borrower nor any of its Subsidiaries
------------------
is (a) an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended,
or (b) a "holding company", or a "subsidiary company" of a "holding company", or
an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
6.11 Regulations U and X. Neither the Borrower nor any of its Subsidiaries
-------------------
is engaged principally, or as one of its important activities, in the business
of extending credit for the purpose of purchasing or carrying Margin Stock, and
no proceeds of any Loan will be used for the purpose, whether immediate,
incidental or ultimate, of purchasing or carrying any Margin Stock or
maintaining or extending credit to others for such purpose except as permitted
under Section 7.10. The Borrower and its Subsidiaries do not hold Margin Stock
------------
having a value in excess of 25% of the assets of the Borrower and its
Subsidiaries taken as a whole.
6.12 Taxes. Each of the Borrower and its Subsidiaries, has filed all
-----
federal and all other material tax returns and reports required by law to have
been filed by it and has paid all taxes and governmental charges thereby shown
to be owing, except any such taxes or charges which are being diligently
contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on its books.
6.13 Environmental and Safety Matters. Except as disclosed in Item 6.13 of
-------------------------------- ---------
the Disclosure Schedule the Borrower and each of its Subsidiaries is in
substantial compliance with all federal, state and local laws, ordinances and
regulations relating to safety and industrial hygiene or to environmental
condition, including, without limitation, all Environmental Laws in
jurisdictions in which the Borrower or any Subsidiary owns or operates, or has
owned or operated, a facility or site, or arranges or has arranged for disposal
or treatment of Hazardous Material, accepts or has accepted for transport any
Hazardous Material or holds or has held any interest in real property or
otherwise. Except as disclosed in Item 6.13 of the Disclosure Schedule, no
---------
demand, claim, notice, suit, suit in equity, action, administrative action,
investigation or inquiry, whether brought by any governmental authority, private
person or entity or otherwise, arising under, relating to or in connection with
any Environmental Laws is pending or, to the best of the Borrower's knowledge,
after due investigation, threatened against the Borrower or any of its
Subsidiaries, any real property in which the Borrower or any such Subsidiary
holds or has held an interest or any past or present operation of the Borrower
or any Subsidiary. Neither the Borrower nor any of its Subsidiaries (i) is, to
the best of the Borrower's
58
knowledge, after due investigation, the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
Release of any Hazardous Material into the environment, (ii) has received any
notice of any Hazardous Material in or upon any of its properties in violation
of any Environmental Laws, or (iii) knows of any basis for any such
investigation, notice or violation, except as disclosed in Section 6.13 of the
------------
Disclosure Schedule. No Release, threatened Release or disposal of Hazardous
Material is occurring or has occurred on, under or to any real property in which
the Borrower or any of its Subsidiaries holds any interest or performs any of
its operations in violation of any Environmental Law, except as disclosed in
Item 6.13 of the Disclosure Schedule. None of the matters disclosed on such
---------
Schedule has had or is reasonably likely to have a Material Adverse Effect.
6.14 Compliance with Law. Except as disclosed in Item 6.14 of the
------------------- ---------
Disclosure Schedule, each of the Borrower and each of its Subsidiaries is in
compliance with all statutes, judicial and administrative orders, permits and
governmental rules and regulations which are material to its business or the
non-compliance with which has had or is reasonably likely to have a Material
Adverse Effect.
6.15 Information. All information heretofore or contemporaneously herewith
-----------
furnished by the Borrower or any of its Subsidiaries to any Bank for purposes of
or in connection with this Agreement and the transactions contemplated hereby
is, and all information hereafter furnished by or on behalf of the Borrower or
any of its Subsidiaries to any Bank pursuant hereto or in connection herewith
will be, true and accurate in every material respect on the date as of which
such information is dated or certified, and such information, taken as a whole,
does not and will not omit to state any material fact necessary to make such
information, taken as a whole, not misleading.
6.16 Ownership of Properties. Item 6.16 of the Disclosure Schedule
----------------------- ---------
correctly sets forth for all real property held by the Borrower and its
Subsidiaries the location and owner. Each of the Borrower and each of its
Subsidiaries owns good and marketable title to or holds valid lease hold
interests in all of its material properties and assets, real and personal, of
any nature whatsoever, free and clear of all Liens except as permitted pursuant
to Section 7.9 and except as set forth in Section 6.16 of the Disclosure
----------- ------------
Schedule; none of the Borrower or any of its Subsidiaries are in default beyond
the expiration of any applicable grace period of any material obligation under
any leases creating any of their leasehold interests in real property, and none
of such property is subject to any Lien except as permitted pursuant to Section
-------
7.9.
---
6.17 Patents, Trademarks, etc. Each of the Borrower and each of its
------------------------
Subsidiaries owns or licenses and possesses all such patents, patent rights,
trademarks, trademark rights, trade names, trade name rights, service marks,
service xxxx rights and copyrights as the Borrower considers necessary for the
conduct of the businesses of the Borrower and such Subsidiaries as now conducted
without, individually or in the aggregate, any infringement upon rights of other
persons which would be reasonably likely to have a Material Adverse Effect.
59
6.18 Insurance. The Borrower and each of its Subsidiaries maintain with
---------
responsible insurance companies insurance (including insurance against claims
and liabilities arising out of the manufacture or distribution of any products)
with respect to their properties and businesses against such casualties and
contingencies and of such types and in such amounts as is customary in the case
of similar businesses, except as disclosed in Item 6.18 of the Disclosure
---------
Schedule.
6.19 Solvency. The Borrower and each Guarantor is Solvent.
--------
6.20 Intercompany Debt. All Debt of the Borrower or any Subsidiary to the
-----------------
Borrower or any Subsidiary is subordinated to the Obligations pursuant to a
subordination agreement in substantially the form attached as Exhibit H.
---------
6.21 Financial Assistance. The giving of guaranties by the Guarantors as
--------------------
contemplated by the Loan Documents and the use of proceeds of the Loans
hereunder have not constituted or involved and will not constitute or involve
any arrangement amounting to unlawful financial assistance within the meaning of
Section 151 of the UK Companies Xxx 0000 or any similar law in the jurisdiction
in which such Guarantor is organized.
6.22 Actuant Agreements. The Borrower has entered into agreements with
------------------
Actuant Corporation regarding environmental liabilities, litigation, contingent
liabilities and shared services in substantially the forms delivered to the
Banks prior to the delivery of the Existing Credit Agreement and such agreements
have not been amended in any material respect.
ARTICLE VII
COVENANTS
---------
Until the expiration or termination of the Commitments, and thereafter
until all obligations of the Borrower hereunder are paid in full, the Borrower
agrees that, unless at any time the Required Banks shall otherwise expressly
consent in writing, it will:
7.1 Reports, Certificates and Other Information. Furnish to the
-------------------------------------------
Administrative Agent, the Independent Auditor and each Bank:
(a) Audit Report. Promptly when available and in any event within 90
-----------
days after the close of each Fiscal Year, (i) a copy of the annual audit
report of the Borrower and its Subsidiaries for such Fiscal Year, including
therein consolidated balance sheets of the Borrower and its Subsidiaries as
of the end of such Fiscal Year and consolidated statements of earnings and
cash flow of the Borrower and its Subsidiaries for such Fiscal Year
certified, without qualification as to going concern or scope, by
independent auditors of recognized national standing selected by the
Borrower and reasonably
60
acceptable to the Required Banks, and (ii) an unaudited consolidating balance
sheet and statements of earnings of such Fiscal Year.
(b) Interim Reports. Promptly when available and in any event within
---------------
45 days after the end of each Fiscal Quarter (except the last Fiscal
Quarter of each Fiscal Year), consolidated balance sheets of the Borrower
and its Subsidiaries as of the end of such Fiscal Quarter, consolidated
statements of earnings and a consolidated statement of cash flow for such
Fiscal Quarter and for the period beginning with the first day of such
Fiscal Year and ending on the last day of such Fiscal Quarter of the
Borrower and its Subsidiaries, with, in the case of each Fiscal Quarter
ending on or after November 30, 2001, comparable information at the close
of and for the corresponding Fiscal Quarter of the prior Fiscal Year and
for the corresponding portion of such prior Fiscal Year, together with a
certificate of the chief financial officer or the Treasurer of the Borrower
to the effect that such financial statements fairly present the financial
condition and results of operations of the Borrower and its Subsidiaries as
of the date and periods indicated (subject to normal year-end adjustments).
(c) Compliance Certificate. Concurrently with each set of financial
----------------------
statements delivered pursuant to Section 7.1(a) and 7.1(b), a Compliance
-------------- ------
Certificate executed by the chief financial officer or the Treasurer of the
Borrower.
(d) Monthly Compliance Certificate. Within 15 days after each month,
------------------------------
a certificate executed by the chief financial officer or Treasurer of the
Borrower, calculating compliance with Section 7.6(b).
--------------
(e) Bi-Monthly Reports. On or before the Thursday following the 15th
------------------
of each month and the last day of each month, the actual cash receipts and
disbursements for the period commencing from the date of the last report
and ending the prior Friday with a comparison report explaining variances
between projections and actual results.
(f) Monthly Cash Forecast. Within seven Business Days after the first
---------------------
day of every month, a revised cash forecast for a four month period,
beginning with a four or five week, weekly forecast, followed by a three
month, monthly forecast.
(g) Forecast. Within 75 days after August 31, 2001, a quarterly
--------
forecast following the year ended August 31, 2001 to include a four-quarter
forward looking projection.
(h) Reports to SEC. Promptly upon the filing or sending thereof, a
--------------
copy of any annual, periodic or special report or registration statement
(inclusive of exhibits thereto) filed by the Borrower or any of its
Subsidiaries with the SEC or any securities exchange.
61
(i) Notice of Default and Other Matters. Immediately upon becoming
-----------------------------------
aware of any of the following, written notice describing the same and the
steps being taken by the Borrower or any of its Subsidiaries affected
thereby with respect thereto: (i) the occurrence of an Event of Default or
a Default; (ii) any litigation, arbitration or governmental investigation
or proceeding not previously disclosed by the Borrower to the Banks which
has been instituted or, to the knowledge of the Borrower, is threatened
against the Borrower or any of its Subsidiaries or to which any of the
properties of any thereof is subject which, if adversely determined, is
reasonably likely to have a Material Adverse Effect; (iii) the institution
of any steps by the Borrower, any of its Subsidiaries or any other Person
to terminate any Pension Plan, or the failure to make a required
contribution to any Pension Plan if such failure is sufficient to give rise
to a lien under Section 302(f) of ERISA, or the taking of any action with
respect to a Pension Plan which could result in the requirement that the
Borrower or any of its Subsidiaries furnish a bond or other security to the
PBGC or such Pension Plan, or the occurrence of any event with respect to
any Pension Plan which could result in the incurrence by the Borrower of
any material liability, fine or penalty, or any material increase in the
contingent liability of the Borrower with respect to any post-retirement
Welfare Plan benefit; and (iv) any other event or occurrence which has had
or is reasonably likely to have a Material Adverse Effect.
(j) Subsidiaries. Promptly upon the formation of any Subsidiary,
------------
notice of such fact.
(k) Certificate of Combined Commitment Reduction. No reduction in the
--------------------------------------------
Applicable Margin in connection with a Combined Commitment Reduction shall
be effective until the Borrower has delivered a certificate in the form of
Exhibit P.
(l) Termination or Expiration of Receivables Securitization. At least
-------------------------------------------------------
thirty (30) days prior to the termination or expiration of the Receivables
Securitization, the Borrower shall provide written notice of such event and
shall provide a copy of any amendment to, or modification of, the
Receivable Securitization.
(m) Other Information. From time to time such other information
-----------------
concerning the Borrower and its Subsidiaries as any Bank, the
Administrative Agent or any representative thereof may reasonably request.
7.2 Books, Records and Inspections. Keep, and cause each of its
------------------------------
Subsidiaries to keep, its books and records reflecting all of its business
affairs and transactions in accordance with sound business practices sufficient
to allow the preparation of financial statements in accordance with GAAP; and
permit, and cause each of its Subsidiaries to permit, any Bank or the
Administrative Agent or any representative thereof, at reasonable times and on
reasonable notice, to visit any or all of its offices, to discuss its financial
matters with its officers and the
62
independent auditors (and the Borrower hereby authorizes such independent
auditor to discuss such financial matters with any Bank or the Administrative
Agent or any representative thereof), and to examine (and, at the Borrower's or
such Subsidiary's expense, make copies of) any of its books or other corporate
records.
7.3 Insurance. Maintain, and cause each of its Subsidiaries to maintain,
---------
with responsible and financially-sound insurance companies or associations,
insurance in such amounts and covering such risks as is usually maintained by
companies engaged in similar businesses and owning similar properties similarly
situated , except as disclosed in Item 6.18 of the Disclosure Schedule; and
---------
deliver within 60 days of the Closing Date and annually thereafter to the
Administrative Agent a certificate as to such insurance.
7.4 Compliance with Law; Payment of Taxes and Liabilities. (a) Comply,
-----------------------------------------------------
and cause each of its Subsidiaries to comply, in all material respects with all
applicable laws, rules, regulations and orders; (b) pay, and cause each of its
Subsidiaries to pay, prior to delinquency, all taxes and other governmental
charges against it or any of its property, provided, however, that the foregoing
-------- -------
shall not require the Borrower or any such Subsidiary to pay any such tax or
charge so long as it shall contest the validity thereof in good faith by
appropriate proceedings and shall set aside on its books adequate reserves with
respect thereto; and (c) comply, and cause each of its Subsidiaries to comply in
all material respects with all material contractual obligations.
7.5 Maintenance of Existence, etc. Maintain and preserve, and (subject to
-----------------------------
Section 7.7) cause each of its Subsidiaries to maintain and preserve, (a) its
-----------
existence and good standing in the jurisdiction of its organization and (b) its
foreign qualification in each other jurisdiction where the nature of its
business makes such qualification necessary (except in those instances in which
the failure to be qualified or in good standing will not have a Material Adverse
Effect).
7.6 Financial Ratios and Restrictions.
---------------------------------
(a) Quarterly Financial Covenants:
-----------------------------
(i) The Borrower and its Subsidiaries shall have EBITDARR
as at the end of each fiscal quarter for the four
fiscal quarter period then ending (except the
calculation shall be made as of May 31, 2001 for the
fiscal quarter then ending, as of August 31, 2001 for
the two fiscal quarters then ending and as of November
30, 2001 for the three fiscal quarters then ending) not
less than the amounts set forth on Schedule 7.6(a)(i).
(ii) The Borrower shall not permit the Non-GAAP
Restructuring Expenses on a cumulative basis from March
1, 2001 to the end of
63
each fiscal quarter to be more than the amount set
forth on Schedule 7.6(a)(ii);
(iii) The Borrower shall not permit the GAAP Restructuring
Expenses on a cumulative basis from March 1, 2001 to
exceed the amount set forth on Schedule 7.6(a)(iii);
(iv) The Borrower and its Subsidiaries shall have the Free
Cash Flow as at the end of each fiscal quarter for the
four fiscal quarter period then ending (except the
calculation shall be made as of May 31, 2001 for the
fiscal quarter then ending, as of August 31, 2001 for
the two fiscal quarters then ending and as of November
30, 2001 for the three fiscal quarters then ending) not
less than the amount set forth in Schedule 7.6(a)(iv);
and
(v) The Borrower shall not permit the consolidated Capital
Expenditures for the Borrower and its Subsidiaries
computed as at the end of any fiscal quarters for the
period of two fiscal quarters then ending to exceed the
amount set forth in Schedule 7.6(a)(v).
(a) Monthly Financial Covenant. The Borrower shall not permit revenue
--------------------------
amounts for itself and its Subsidiaries to be less than the amount set
forth in Schedule 7.6(b). After compliance with this covenant through
February 28, 2002, the Borrower may request that the monthly financial
covenant in this Section 7.6(b) be waived.
In connection with any sale of assets permitted by this Agreement or consented
to by the Required Banks and assuming application of Net Proceeds as required
hereunder, the covenants under this Section 7.6 shall be adjusted, with the
amount of such adjustment determined by mutual agreement (i) of the
Administrative Agent and the Borrower if the sale of assets was permitted under
Section 7.20(c) and (ii) the Required Banks and the Borrower, if the sale of
---------------
assets was not permitted under Section 7.20(c).
---------------
7.7 Mergers, Consolidations and Purchases. Not, and not permit any of its
-------------------------------------
Subsidiaries to, be a party to any merger or consolidation, or purchase or
otherwise acquire all or a substantial portion of the business or, assets of, or
any stock of any class of, or any partnership or joint venture interest in, any
other Person, except for any such merger or consolidation, by any such
Subsidiary into or with the Borrower or into or with any wholly-owned Subsidiary
of the Borrower.
Notwithstanding the foregoing, no Guarantor may merge or consolidate unless
the surviving corporation is a Guarantor or the Borrower. No merger or
consolidation will be permitted if the result would be that a perfected Lien in
Collateral shall no longer be perfected.
64
7.8 Commercial Paper. Not, and not permit any of its Subsidiaries to,
----------------
create, incur, assume or suffer to exist or otherwise become or be liable in
respect of any Debt with respect to unsecured commercial paper, other than such
commercial paper outstanding on the date hereof.
7.9 Liens. Not, and not permit any of its Subsidiaries to, create or
-----
permit to exist any Lien on any of its real or personal properties, assets or
rights of whatsoever nature, whether now owned or hereafter acquired, except (a)
Liens for taxes or other governmental charges not at the time delinquent or
thereafter payable without penalty or being contested in good faith by
appropriate proceedings and, in each case, for which it maintains adequate
reserves; (b) Liens arising in the ordinary course of business (such as (i)
Liens of carriers, warehousemen, mechanics and materialmen and other similar
Liens imposed by law and (ii) Liens incurred in connection with worker's
compensation, unemployment compensation and other types of social security
(excluding Liens arising under ERISA) or in connection with surety and appeal
bonds, bids, performance bonds and similar obligations) for sums not overdue or
being contested in good faith by appropriate proceedings and not involving any
deposits or advances or borrowed money or the deferred purchase price of
property or services, and, in each case, for which it maintains adequate
reserves; (c) attachments, judgments and other similar Liens, for sums not
exceeding $2,000,000, arising in connection with court proceedings, provided the
execution or other enforcement of such Liens is effectively stayed and the
claims secured thereby are being actively contested in good faith and by
appropriate proceedings; (d) other Liens incidental to the conduct of the
business of the Borrower or a Subsidiary or the ownership of its property or
assets, including easements, rights of way, restrictions, minor defects or
irregularities in title and other similar Liens, which Liens were not incurred
in connection with the borrowing of money and do not, in any case or in the
aggregate, interfere in any material respect with the ordinary conduct of the
business of the Borrower or any Subsidiary; (e) building restrictions, zoning
laws and other statutes, laws, rules, regulations, ordinances and restrictions,
and any amendments thereto, now or at any time hereafter adopted by any
governmental authority having jurisdiction; cash collateral pursuant to the Loan
Documents; (f) Liens on the Collateral for the benefit of the Agent and the
Banks; (g) Liens on the collateral to secure the UK Debt; (h) Liens listed on
Item 7.9 of the Disclosure Schedule and (i) other Liens, securing obligations
not to exceed in the aggregate $7,500,000 at any time outstanding.
7.10 Use of Proceeds. Use the proceeds of the Loans to refinance existing
---------------
commercial paper and to provide for working capital, capital expenditures and
for other general corporate purposes; and not use or permit any proceeds of any
Loan to be used, either directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of purchasing or otherwise acquiring any
stock of any Person.
7.11 Maintenance of Property. Maintain, and cause each of its Subsidiaries
-----------------------
to maintain, its properties which are material to the conduct of its business in
good working order and condition (ordinary wear and tear excepted).
65
7.12 Employee Benefit Plans. Maintain, and cause each of its Subsidiaries
----------------------
to maintain, each Pension Plan in compliance in all material respects with all
applicable Requirements of Law and regulations.
7.13 Business Activities. Not make any substantial change in the nature of
-------------------
the business of the Borrower and its Subsidiaries, taken as a whole, from that
engaged in on the date of this Agreement.
7.14 Environmental Matters.
---------------------
(a) Environmental Obligations. (i) Comply, and cause each of its
-------------------------
Subsidiaries to comply, in a reasonable manner with any applicable Federal
or state judicial or administrative order requiring the performance at any
real property owned, operated, or leased by the Borrower or any such
Subsidiary of activities in response to any Release or threatened Release
of any Hazardous Material, except for the period of time that the Borrower
or such Subsidiary is diligently in good faith contesting such order; (ii)
use and operate, and cause each such Subsidiary to use and operate, all of
its facilities and properties in material compliance with all Environmental
Laws; (iii) keep, and cause each such Subsidiary to keep, all necessary
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material
compliance therewith; (iv) handle, and cause each such Subsidiary to
handle, all Hazardous Materials in material compliance with all applicable
Environmental Laws; and (v) not, and not permit any such Subsidiary to,
commence disposal of any Hazardous Material into or onto any real property
owned, operated or leased by the Borrower or any of its Subsidiaries nor
allow any Lien imposed pursuant to any Environmental Law to attach to any
such real property.
(b) Environmental Information. Within 60 days of receipt thereof,
-------------------------
notify the Administrative Agent of the receipt by the Borrower or any of
its Subsidiaries of any written claim, demand, proceeding, action or notice
of liability by any Person arising out of or relating to the Release or
threatened Release of any Hazardous Material, except for any release or
threatened release with respect to which the maximum liability of the
Borrower and its Subsidiaries is reasonably expected to be less than
$1,000,000; and within 60 days of any Release, threatened Release, or
disposal of any Hazardous Material reported to any governmental regulatory
authority at any real property owned, operated or leased by the Borrower or
any of its Subsidiaries notify the Administrative Agent of such release,
threat of release or disposal, except for any release, threat of release or
disposal with respect to which the maximum liability of the Borrower and
its Subsidiaries is reasonably expected to be less than $1,000,000.
7.15 Unconditional Purchase Obligations. Not, and not permit any of its
----------------------------------
Subsidiaries to, enter into or be a party to any contract for the purchase of
materials, supplies or other property
66
or services, if such contract requires that payment be made by it regardless of
whether or not delivery is ever made of such materials, supplies or other
property or services.
7.16 Inconsistent Agreements. Not, and not permit any of its Subsidiaries
-----------------------
to, enter into any agreement containing any provision which would be violated or
breached by any borrowing by the Borrower hereunder or by the performance by the
Borrower or any of its Subsidiaries of any of its obligations hereunder.
7.17 Transactions with Affiliates. Not, and not permit any Subsidiary to,
----------------------------
enter into or permit to exist any transaction, arrangement or contract with any
of its Affiliates or any officer or director of the Borrower or any Affiliate
which is on terms less favorable than would be available from a Person which is
not an Affiliate. Nothing in this Section 7.17 shall prohibit any transaction
------------
expressly permitted by Section 7.7 or Section 7.21.
----------- ------------
7.18 The Borrower's and Subsidiaries' Stock. The Borrower will not, nor
--------------------------------------
will it permit any of its Subsidiaries to, purchase or otherwise acquire any
shares of capital stock of the Borrower; and Borrower shall, except pursuant to
transactions permitted by Section 7.7, not take any action, or permit any of its
-----------
Subsidiaries to take any action, which will, so long as any shares of capital
stock or indebtedness of any corporation which is a Subsidiary at the date of
this Agreement are owned by the Borrower or any Subsidiary, result in a decrease
in the percentage of the outstanding shares in capital stock of such corporation
owned at the date of this Agreement by the Borrower and its Subsidiaries.
7.19 Restrictive Agreements. The Borrower will not, nor will it permit any
----------------------
of its Subsidiaries to, enter into any agreement (excluding this Agreement) (a)
which would restrict the ability of any such Subsidiary to pay or make dividends
or distributions in cash or kind, to make loans, advances or other payments of
whatsoever nature, or to make transfers or distributions of all or any part of
its assets, in each case to the Borrower or to any corporation as to which such
Subsidiary is a Subsidiary; or (b) which would require the consent or waiver of
any third party to any amendment to this Agreement or any other Loan Document.
7.20 Sales of Assets. The Borrower shall not, and shall not permit any of
---------------
its Subsidiaries to, except in the ordinary course of its business, sell,
transfer, convey or lease all or a substantial part of its assets, or sell or
assign with or without recourse any receivables, except for:
(a) any such sale, transfer, conveyance, lease or assignment of or by
any Subsidiary to the Borrower or to any other Subsidiary of the Borrower;
(b) in connection with the Receivables Securitization; and
67
(c) so long as no Event of Default or Default exists or would result
therefrom, any sale, transfer, conveyance or lease of any other asset for
cash provided that the aggregate book value (disregarding any write-downs
of such book value other than ordinary depreciation and amortization) of
all assets disposed of by the Borrower and its Subsidiaries pursuant to
this clause (c) does not exceed 10% of Tangible Net Assets of the Borrower
----------
and its Subsidiaries (measured as of the last day of the most recently
ended Fiscal Year). The Administrative Agent shall, at the request of the
Borrower, release any Lien on Collateral sold pursuant to Section 7.20(c).
7.21 Loans and Investments. The Borrower shall not purchase or acquire, or
---------------------
suffer or permit any Subsidiary to purchase or acquire, or make any commitment
therefor, any capital stock, equity interest, or any obligations or other
securities of, or any interest in, any Person, or make or commit to make any
advance, loan, extension of credit or capital contribution to or any other
investment in, any Person including any Affiliate of the Borrower, except for:
(a) investments in cash equivalents;
(b) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) Investments by the Borrower in any of its Subsidiaries or by any
of its Subsidiaries in another of its Subsidiaries, except that Domestic
Subsidiaries are limited to making Investments in other Domestic
Subsidiaries;
(d) transactions permitted under Section 7.7; and
-----------
(e) the Investments listed on the attached Schedule 7.21.
7.22 Limitation on Debt and Subsidiary Debt. The Borrower shall not, and
--------------------------------------
shall not suffer or permit any Subsidiary to, create, incur, assume, suffer to
exist, or otherwise become or remain directly or indirectly liable with respect
to any Debt of the Borrower and Subsidiaries other than Debt associated with the
Receivables Securitization, the UK Debt, the Obligations, Debt listed on
attached Schedule 7.22 and additional Debt not to exceed $7,500,000 at any time
outstanding.
7.23 Restricted Payments. The Borrower shall not, and shall not suffer or
-------------------
permit any Subsidiary to, declare or make any dividend payment or other
distribution of assets, properties, cash, rights, obligations or securities on
account of any shares of any class of its capital stock, or purchase, redeem or
otherwise acquire for value any shares of its capital stock or any warrants,
rights or options to acquire such shares, now or hereafter outstanding; except
that:
68
(a) the Borrower and its Subsidiaries may declare and make dividend
payments or other distributions payable solely in its common stock;
(b) the Borrower may purchase, redeem or otherwise acquire shares of
its common stock or warrants or options to acquire any such shares with the
proceeds received from the substantially concurrent issue of new shares of
its common stock; and
(c) the Subsidiaries of the Borrower may pay dividends to the Borrower
and its Subsidiaries.
ARTICLE VIII
EVENTS OF DEFAULT AND THEIR EFFECT
----------------------------------
8.1 Events of Default. Each of the following shall constitute an Event of
-----------------
Default under this Agreement:
(a) Non-Payment of Loans, etc. Default in the payment when due of the
-------------------------
principal of any Loan or reimbursement of a Letter of Credit; or default,
and continuance thereof for five Business Days, in the payment when due of
any interest on any Loan or any fees or other amounts payable by the
Borrower hereunder.
(b) Non-Payment of Other Indebtedness for Borrowed Money. Default in
----------------------------------------------------
the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any other Debt (including without limitation,
the Debt under the UK Credit Agreement as defined in the UK/US
Intercreditor Agreement) of, or guaranteed by, the Borrower or any of its
Subsidiaries in excess in the aggregate of $2,000,000; or default in the
performance or observance of any obligation or condition with respect to
any such other indebtedness in excess in the aggregate of $2,000,000 if the
effect of such default is to accelerate the maturity of any such
indebtedness or to permit the holder or holders thereof, or any trustee or
agent for such holders, to cause such indebtedness to become due and
payable prior to its expressed maturity.
(c) Warranties. Any representation or warranty made by the Borrower
----------
or any Subsidiary of the Borrower herein or in any Loan Document is
breached, or is false or misleading, in any material respect, or any
schedule, certificate, financial statement, report, notice or other writing
furnished by the Borrower to the Administrative Agent or any Bank is false
or misleading in any material respect on the date as of which the facts
therein set forth are stated or certified.
69
(d) Bankruptcy, Insolvency, etc. The Borrower or any of its
---------------------------
Subsidiaries becomes insolvent (it being understood that a Subsidiary shall
not be deemed to be insolvent solely because it has negative net worth) or
generally fails to pay, or admits in writing its inability to pay, debts as
they become due; or the Borrower or any of its Subsidiaries applies for,
consents to or acquiesces in the appointment of a trustee, receiver or
other custodian for the Borrower or such Subsidiary or any property
thereof, or makes a general assignment for the benefit of creditors; or, in
the absence of such application, consent or acquiescence, a trustee,
receiver or other custodian is appointed for the Borrower or any of its
Subsidiaries or for a substantial part of its property and is not
discharged within 30 days; or any bankruptcy, reorganization, debt
arrangement or other case or proceeding under any bankruptcy or insolvency
law, or any dissolution or liquidation proceeding (except the voluntary
dissolution, not under any bankruptcy or insolvency law, of a Subsidiary),
is commenced in respect of the Borrower or any of its Subsidiaries, and, if
such case or proceeding is not commenced by the Borrower or such
Subsidiary, it is consented to or acquiesced in by the Borrower or such
Subsidiary or remains for 30 days undismissed or an order for relief is
entered in any such involuntary bankruptcy; or the Borrower or any
Subsidiary takes any corporate action to authorize, or in furtherance of,
any of the foregoing.
(e) Non-Compliance with Certain Covenants. Failure by the Borrower to
-------------------------------------
comply with or to perform any provision of Section 7.1(d), Section 7.1(i),
-------------- --------------
Section 7.1(l), Section 7.6 (other than Section 7.6(b)) through 7.10, 7.16,
-------------- ----------- -------------- ---- ----
or 7.18 through 7.23.
---- ----
(f) Non-Compliance with Other Provisions of this Agreement. Failure
------------------------------------------------------
by the Borrower or any Guarantor to comply with or to perform any provision
of this Agreement or any other Loan Document (if such failure does not
constitute an Event of Default under any of the other provisions of this
Section 8.1), and continuance of such failure for 30 (or, in the case of
-----------
Section 7.6(b), 10) days after notice thereof to the Borrower from the
--------------
Administrative Agent or any Bank.
(g) Pension Plans. (i) Institution of any steps by the Borrower or
-------------
any other Person to terminate a Pension Plan if as a result of such
termination the Borrower or any Subsidiary could be required to make a
contribution to such Pension Plan, or could incur a liability or obligation
to such Pension Plan, in excess of $1,000,000, or (ii) a contribution
failure occurs with respect to any Pension Plan sufficient to give rise to
a Lien under section 302(f) of ERISA.
(h) Judgments. Final judgments which exceed an aggregate of
---------
$2,000,000 (excluding any portion thereof which is covered by insurance
maintained with a responsible insurance company which has accepted a tender
of defense and indemnification without reservation of rights) shall be
rendered against the Borrower or
70
any of its Subsidiaries and shall not have been discharged or vacated or
had execution thereof stayed pending appeal within 30 days after entry or
filing of such judgments.
(i) Change of Control. An Impermissible Change of Control shall
-----------------
occur.
(j) Material Adverse Effect. Any event shall occur which, in the
-----------------------
opinion of the Required Banks, has had or is reasonably likely to have a
Material Adverse Effect.
(k) Guaranty. The obligations of any Guarantor under any Guaranty
--------
shall cease to be in full force and effect or such Guarantor shall contest
in any manner the validity, binding nature or enforceability of its
Guaranty, other than in respect of the full and indefeasible payment of the
Obligations and the termination of the Commitments.
(l) Receivables Securitization Termination or Expiration. The
----------------------------------------------------
Receivables Securitization shall expire or term out or a Termination Event
shall occur with respect thereto.
(m) Collateral.
----------
(i) Any provision of any Collateral Document shall for any
reason cease to be valid and binding on or enforceable against the Borrower
or any Subsidiary party thereto or the Borrower or any Subsidiary shall so
state in writing or bring an action to limit its obligations or liabilities
thereunder; or
(ii) Any Collateral Document or Collateral Documents shall for
any reason (other than pursuant to the terms thereof) cease to create a
valid security interest in the Collateral purported to be covered thereby
or such security interest shall for any reason cease to be a perfected and
first priority security interest, if the effect thereof is to cause
Collateral having an aggregate value in excess of $10,000,000 to no longer
be covered by a perfected and first priority security interest.
8.2 Effect of Event of Default. If any Event of Default described in
--------------------------
Section 8.1(d) shall occur, the Commitments (if they have not theretofore
--------------
terminated) shall immediately terminate and all Loans and all interest and other
amounts due hereunder shall become immediately due and payable, all without
presentment, demand or notice of any kind (all of which are hereby expressly
waived by the Borrower); and, in the case of any other Event of Default, the
Administrative Agent may with the consent of the Required Banks, and shall upon
written request of the Required Banks, declare the Commitments (if they have not
theretofore terminated) to be terminated and/or all Loans and all interest and
other amounts due hereunder to be due and payable, whereupon the Commitments (if
they have not theretofore terminated) shall immediately terminate and/or all
Loans and all interest and other amounts due hereunder shall become immediately
due and payable, all without presentment, demand or notice of any kind (all
71
of which are hereby expressly waived by the Borrower). The Administrative Agent
shall promptly advise the Borrower and each Bank of any such declaration, but
failure to do so shall not impair the effect of such declaration.
Notwithstanding the foregoing, the effect as an Event of Default of any event
described in Section 8.1(a) or Section 8.1(d) may be waived by the written
-------------- --------------
concurrence of all of the Banks, and the effect as an Event of Default of any
other event described in Section 8.1 may be waived by the written concurrence of
-----------
the Required Banks.
ARTICLE IX
THE ADMINISTRATIVE AGENT
------------------------
9.1 Appointment and Authorization; Administrative Agent. Each Bank hereby
---------------------------------------------------
irrevocably (subject to Section 9.9) appoints, designates and authorizes the
-----------
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, nor shall the Administrative Agent have or be deemed
to have any fiduciary relationship with any Bank, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" in this Agreement with reference to the
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
9.2 Delegation of Duties. The Administrative Agent may execute any of its
--------------------
duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
9.3 Liability of Administrative Agent. None of the Administrative Agent-
---------------------------------
Related Persons shall (i) be liable for any action taken or omitted to be taken
by any of them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except for its own gross
negligence or willful misconduct), or (ii) be responsible in any manner to any
of the Banks for any recital, statement, representation or warranty made by the
Borrower or any Subsidiary or Affiliate of the Borrower, or any officer thereof,
contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement or other
72
document referred to or provided for in, or received by the Administrative Agent
under or in connection with, this Agreement or any other Loan Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document, or for any failure of the Borrower or any
other party to any Loan Document to perform its obligations hereunder or
thereunder. No Administrative Agent-Related Person shall be under any obligation
to any Bank to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books or records of the
Borrower or any of the Borrower's Subsidiaries or Affiliates.
9.4 Reliance by Administrative Agent.
--------------------------------
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel
(including counsel to the Borrower), independent accountants and other
experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan Document unless it shall first receive
such advice or concurrence of the Required Banks as it deems appropriate
and, if it so requests, it shall first be indemnified to its satisfaction
by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting,
or in refraining from acting, under this Agreement or any other Loan
Document in accordance with a request or consent of the Required Banks and
such request and any action taken or failure to act pursuant thereto shall
be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 5.1, each Bank that has executed this Agreement shall
-----------
be deemed to have consented to, approved or accepted or to be satisfied
with, each document or other matter either sent by the Administrative Agent
to such Bank for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory
to the Bank.
9.5 Notice of Default. The Administrative Agent shall not be deemed to
-----------------
have knowledge or notice of the occurrence of any Default or Event of Default,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Banks,
unless the Administrative Agent shall have received written notice from a Bank
or the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". The
Administrative Agent
73
will notify the Banks of its receipt of any such notice. The Administrative
Agent shall take such action with respect to such Default or Event of Default as
may be requested by the Required Banks in accordance with Article VIII;
provided, however, that unless and until the Administrative Agent has received
-------- -------
any such request, the Administrative Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Banks.
9.6 Credit Decision. Each Bank acknowledges that none of the
---------------
Administrative Agent-Related Persons has made any representation or warranty to
it, and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrower and its Subsidiaries, shall be deemed to
constitute any representation or warranty by any Administrative Agent-Related
Person to any Bank. Each Bank represents to the Administrative Agent that it
has, independently and without reliance upon any Administrative Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower and its Subsidiaries, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Borrower hereunder. Each Bank also
represents that it will, independently and without reliance upon any
Administrative Agent-Related Person and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action under this
Agreement and the other Loan Documents, and to make such investigations as it
deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrower.
Except for notices, reports and other documents expressly herein required to be
furnished to the Banks by the Administrative Agent, the Administrative Agent
shall not have any duty or responsibility to provide any Bank with any credit or
other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of the Borrower which may come
into the possession of any of the Agent-Related Persons.
9.7 Indemnification of Administrative Agent. Whether or not the
---------------------------------------
transactions contemplated hereby are consummated, the Banks shall indemnify upon
demand the Administrative Agent-Related Persons (to the extent not reimbursed by
or on behalf of the Borrower and without limiting the obligation of the Borrower
to do so), pro rata, from and against any and all Indemnified Liabilities;
provided, however, that no Bank shall be liable for the payment to the
-------- -------
Administrative Agent-Related Persons of any portion of such Indemnified
Liabilities resulting from such Person's gross negligence or willful misconduct.
Without limitation of the foregoing, each Bank shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or out-of-
pocket expenses (including Attorney Costs) incurred by the Administrative Agent
in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this
74
Agreement, any other Loan Document, or any document contemplated by or referred
to herein, to the extent that the Administrative Agent is not reimbursed for
such expenses by or on behalf of the Borrower. The undertaking in this Section
shall survive the payment of all Obligations hereunder and the resignation or
replacement of the Administrative Agent.
9.8 Bank of America in Individual Capacity. Bank of America and its
--------------------------------------
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with the
Borrower and its Subsidiaries and Affiliates as though Bank of America were not
the Administrative Agent hereunder and without notice to or consent of the
Banks. The Banks acknowledge that, pursuant to such activities, Bank of America
or its Affiliates may receive information regarding the Borrower or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Borrower or such Subsidiary) and acknowledge that
neither Bank of America nor the Administrative Agent shall be under any
obligation to provide such information to them. With respect to its Loans, Bank
of America shall have the same rights and powers under this Agreement as any
other Bank and may exercise the same as though Bank of America were not the
Administrative Agent.
9.9 Successor Administrative Agent. The Administrative Agent may, and at
------------------------------
the request of the Required Banks shall, resign as Administrative Agent upon 30
days' notice to the Banks. If the Administrative Agent resigns under this
Agreement, the Required Banks shall appoint from among the Banks a successor
agent for the Banks. If no successor agent is appointed prior to the effective
date of the resignation of the Administrative Agent, the Administrative Agent
may appoint, after consulting with the Banks and the Borrower, a successor agent
from among the Banks. Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Article VIII and Sections 9.4 and
------------
9.5 shall inure to its benefit as to any actions taken or omitted to be taken by
---
it while it was Administrative Agent under this Agreement. If no successor
agent has accepted appointment as Administrative Agent by the date which is 30
days following a retiring Administrative Agent's notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless thereupon become
effective and the Banks shall perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Required Banks appoint a
successor agent as provided for above.
9.10 Withholding Tax.
---------------
(a) If any Bank is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Bank claims exemption from, or a
reduction of, U.S.
75
withholding tax under Sections 1441 or 1442 of the Code, such Bank agrees
with and in favor of the Administrative Agent, to deliver to the
Administrative Agent:
(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form W-8BEN on or before the
payment of any interest in the first calendar year and before the
payment of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Bank, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year of
such Bank and in each succeeding taxable year of such Bank during
which interest may be paid under this Agreement; and
(iii) if such Bank is a foreign partnership or other
intermediary and its partners claim an exemption from, or a reduction
of, withholding tax under a United States tax treaty or if its
partners claim that interest paid under this Agreement is exempt from
Untied States withholding tax because it is effectively connected with
the conduct with a United States trade or business, two properly
completed and executed copies of IRS Form W-8IMY on or before the
payment of any interest in the first calendar year and before the
payment of any interest in each third succeeding calendar year during
which interest may be paid under this Agreement;
(iv) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from,
or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Administrative Agent of any change
in circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such
Bank sells, assigns, grants a participation in, or otherwise transfers all
or part of the Obligations of the Borrower to such Bank, such Bank agrees
to notify the Administrative Agent of the percentage amount in which it is
no longer the beneficial owner of Obligations of the Borrower to such Bank.
To the extent of such percentage amount, the Administrative Agent will
treat such Bank's IRS Form W-8BEN as no longer valid.
76
(c) If any Bank claiming exemption from United States withholding tax
by filing IRS Form W-8ECI with the Administrative Agent sells, assigns,
grants a participation in, or otherwise transfers all or part of the
Obligations of the Borrower to such Bank, such Bank agrees to undertake
sole responsibility for complying with the withholding tax requirements
imposed by Sections 1441 and 1442 of the Code.
(d) If any bank is a foreign partnership or other intermediary and its
partners claim exemption from, or reduction of, withholding tax under a
Untied States tax treaty by providing IRS Form W-8BEN or its partners claim
exemption from Untied States withholding tax by filing IRS Form W-8ECI, and
any of its partners sell, assign, grant a participation in, or otherwise
transfer all or part of the Obligations of the Borrower to such Bank, such
Bank agrees to notify the Administrative Agent of the percentage amount in
which the partner is no longer the beneficial owner of Obligations of the
Borrower to such Bank. To the extent of such percentage amount, the
Administrative Agent will treat such partner's IRS Form W-8BEN or W-8ECI as
no longer valid.
(e) If any Bank is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any interest
payment to such Bank an amount equivalent to the applicable withholding tax
after taking into account such reduction. However, if the forms or other
documentation required by Section 9.10(a) are not delivered to the
---------------
Administrative Agent, then the Administrative Agent may withhold from any
interest payment to such Bank not providing such forms or other
documentation an amount equivalent to the applicable withholding tax
imposed by Sections 1441 and 1442 of the Code, without reduction.
(f) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Administrative Agent
did not properly withhold tax from amounts paid to or for the account of
any Bank (because the appropriate form was not delivered, was not properly
executed, or because such Bank failed to notify the Administrative Agent of
a change in circumstances which rendered the exemption from, or reduction
of, withholding tax ineffective, or for any other reason) such Bank shall
indemnify the Administrative Agent fully for all amounts paid, directly or
indirectly, by the Administrative Agent as tax or otherwise, including
penalties and interest, and including any taxes imposed by any jurisdiction
on the amounts payable to the Administrative Agent under this Section,
together with all costs and expenses (including Attorney Costs). The
obligation of the Banks under this Section 9.10(e) shall survive the
---------------
payment of all Obligations and the resignation or replacement of the
Administrative Agent.
9.11 Syndication Agent or Documentation Agent. None of the Banks
----------------------------------------
identified on the facing page or signature pages of this Agreement as a
"syndication agent" or "documentation agent" shall have any right, power,
obligation, liability, responsibility or duty under this
77
Agreement other than those applicable to all Banks as such. Without limiting the
foregoing, none of the Banks so identified as a "syndication agent" or a
"documentation agent" shall have or be deemed to have any fiduciary relationship
with any Bank. Each Bank acknowledges that it has not relied, and will not rely,
on any of the Banks so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
9.12 Collateral Matters.
------------------
(a) The Administrative Agent is authorized on behalf of all the
Banks, without the necessity of any notice to or further consent from the
Banks, from time to time to take any action with respect to any Collateral
or the Collateral Documents which, in its sole judgment, may be necessary
or otherwise advisable to perfect and maintain perfected the security
interest in and Liens upon the Collateral granted pursuant to the
Collateral Documents.
(b) The Banks irrevocably authorize the Administrative Agent, at its
option and in its discretion, to release any Lien granted to or held by the
Agent upon any Collateral that is not a substantial portion of the
Collateral (i) constituting property sold or to be sold or disposed of as
part of or in connection with any disposition permitted hereunder; (ii)
constituting property in which the Borrower or any Subsidiary owned no
interest at the time the Lien was granted or at any time thereafter; (iii)
constituting property leased to the Borrower or any Subsidiary under a
lease which has expired or been terminated in a transaction permitted under
this Agreement or is about to expire and which has not been, and is not
intended by the Borrower or such Subsidiary to be, renewed or extended;
(iv) consisting of an instrument evidencing Indebtedness or other debt
instrument, if the indebtedness evidenced thereby has been paid in full; or
(v) if approved, authorized or ratified in writing by the Required Banks
under Section 10.1 or the Banks having Pro Rata Shares in excess of 66 2/3%
under Section 10.2. Upon request by the Administrative Agent at any time,
the Banks will confirm in writing the Administrative Agent's authority to
release particular types or items of Collateral pursuant to this subsection
9.12(b), provided that the absence of any such confirmation for whatever
reason shall not affect the Administrative Agent's rights under this
Section 9.12.
(c) The Banks authorize the Administrative Agent to execute amendments
to the Pledge Agreement and the Security Agreement providing for the
Collateral to secure Swap Contracts existing on the date hereof issued by
Banks on a pari passu basis.
78
ARTICLE X
MISCELLANEOUS
-------------
10.1 Amendments and Waivers. No amendment or waiver of any provision of
----------------------
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Borrower therefrom, shall be effective unless the same shall be
in writing and signed by the Required Banks (or by the Administrative Agent at
the written request of the Required Banks) and the Borrower and acknowledged by
the Administrative Agent, and then any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however, that no such waiver, amendment, or consent shall, unless in
-------- -------
writing and signed by all the Banks and the Borrower and acknowledged by the
Administrative Agent, do any of the following:
(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 8.2);
-----------
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts
due to the Banks (or any of them) hereunder or under any other Loan
Document;
(c) reduce the principal of, or the rate of interest specified herein
on any Loan, or (subject to clause (ii) below) any fees or other amounts
payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Banks or any
of them to take any action hereunder;
(e) release any Guarantor from any of its obligations under any
Guaranty;
(f) release the Borrower from its obligations under Article V;
(g) amend this Section or the definition of "Required Banks" or
Section 2.17 or any provision herein providing for consent or other action
------------
by all Banks;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Required Banks
or all the Banks, as the case may be, affect the rights or duties of the
Administrative Agent under this Agreement or any other Loan Document, and (ii)
the Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed by the parties thereto.
79
10.2 Release of Collateral. The Administrative Agent shall not release a
---------------------
substantial portion of the Collateral without the consent of Banks having an
aggregate Pro Rata Share of the Commitments in excess of 66 2/3% Any such
release shall also be subject to the terms of the UK/US Intercreditor Agreement.
10.3 Notices.
-------
(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by the Borrower by facsimile (i) shall be immediately confirmed
by a telephone call to the recipient at the number specified on Schedule
--------
10.3, and (ii) shall be followed promptly by delivery of a hard copy
----
original thereof) and mailed, faxed or delivered, to the address or
facsimile number specified for notices on Schedule 10.3; or, as directed to
-------------
the Borrower or the Administrative Agent, to such other address as shall be
designated by such party in a written notice to the other parties, and as
directed to any other party, at such other address as shall be designated
by such party in a written notice to the Borrower and the Administrative
Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered
for overnight (next-day) delivery, or transmitted in legible form by
facsimile machine, respectively, or if mailed, upon the third Business Day
after the date deposited into the U.S. mail, or if delivered, upon
delivery; except that notices pursuant to Article II or IX shall not be
---------- --
effective until actually received by the Administrative Agent.
(c) Any agreement of the Administrative Agent and the Banks herein to
receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Borrower. The Administrative Agent
and the Banks shall be entitled to rely on the authority of any Person
purporting to be a Person authorized by the Borrower to give such notice
and the Administrative Agent and the Banks shall not have any liability to
the Borrower or other Person on account of any action taken or not taken by
the Administrative Agent or the Banks in reliance upon such telephonic or
facsimile notice. The obligation of the Borrower to repay the Loans shall
not be affected in any way or to any extent by any failure by the
Administrative Agent and the Banks to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Administrative Agent
and the Banks of a confirmation which is at variance with the terms
understood by the Administrative Agent and the Banks to be contained in the
telephonic or facsimile notice.
10.4 No Waiver; Cumulative Remedies. No failure to exercise and no delay
------------------------------
in exercising, on the part of the Administrative Agent or any Bank, any right,
remedy, power or
80
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
10.5 Costs and Expenses. The Borrower shall
------------------
(a) whether or not the transactions contemplated hereby are
consummated, pay, in addition to the amounts required to be paid on or
before the Closing Date pursuant to Section 5.1(q) hereof, or reimburse
Bank of America (including in its capacity as Administrative Agent) within
five Business Days after demand for all reasonable costs and expenses
incurred by Bank of America (including in its capacity as Administrative
Agent) in connection with the development, preparation, delivery,
administration and execution of, and any further amendment, supplement,
waiver or modification to (in each case, whether or not consummated), and
any other documents prepared in connection therewith, and the consummation
of the transactions contemplated thereby, including reasonable Attorney
Costs incurred by Bank of America (including in its capacity as
Administrative Agent) with respect thereto; and
(b) pay or reimburse the Administrative Agent, the Lead Arranger and
each Bank within five Business Days after demand for all reasonable costs
and expenses (including Attorney Costs) incurred by them in connection with
the enforcement, attempted enforcement, or preservation of any rights or
remedies under this Agreement or any other Loan Document during the
existence of an Event of Default or after acceleration of the Loans
(including in connection with any "workout" or restructuring regarding the
Loans, and including in any Insolvency Proceeding or appellate proceeding).
10.6 Borrower Indemnification. Whether or not the transactions
------------------------
contemplated hereby are consummated, the Borrower shall indemnify, defend and
hold the Administrative Agent-Related Persons, and each Bank and each of its
respective officers, directors, employees, counsel, agents and attorneys-in-fact
(each, an "Indemnified Person") harmless from and against any and all
------------------
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, charges, expenses and disbursements (including Attorney Costs) of any
kind or nature whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement of the
Administrative Agent or replacement of any Bank) be imposed on, incurred by or
asserted against any such Person in any way relating to or arising out of this
Agreement or any document contemplated by or referred to herein, or the
transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with respect
to any investigation, litigation or proceeding (including any insolvency
proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or the use of the proceeds thereof, or related to any Offshore
Currency Transactions entered into in connection herewith, whether or not any
Indemnified Person is a
81
party thereto (all the foregoing, collectively, the "Indemnified Liabilities");
-----------------------
provided, that the Borrower shall have no obligation hereunder to any
Indemnified Person with respect to Indemnified Liabilities resulting from the
gross negligence or willful misconduct of such Indemnified Person. The
agreements in this Section shall survive payment of all other Obligations.
10.7 Payments Set Aside. To the extent that the Borrower makes a payment
------------------
to the Administrative Agent or the Banks, or the Administrative Agent or the
Banks exercise their right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Bank in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent
of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Bank
severally agrees to pay to the Administrative Agent upon demand its pro rata
share of any amount so recovered from or repaid by the Administrative Agent.
10.8 Successors and Assigns. The provisions of this Agreement shall be
----------------------
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Administrative Agent and each Bank.
10.9 Assignments, Participations, etc.
--------------------------------
(a) Any Bank may, with the written consent of the Administrative Agent
and the Issuing Bank, which consents shall not be unreasonably withheld, at
any time assign and delegate to one or more Eligible Assignees (provided
that no written consent of the Administrative Agent or the Issuing Bank
shall be required in connection with any assignment and delegation by a
Bank to an Eligible Assignee that is an Affiliate of such assigning Bank)
(each an "Assignee") all, or any ratable part of all, of the Loans, the
--------
Commitments and the other rights and obligations of such Bank hereunder, in
a minimum amount of the lesser of (i) $5,000,000 or (ii) the full amount of
the Loans, the Commitments and the other rights and obligations of such
Bank; provided, however, that the Borrower and the Administrative Agent may
-------- -------
continue to deal solely and directly with such Bank in connection with the
interest so assigned to an Assignee until (i) written notice of such
assignment, together with payment instructions, addresses and related
information with respect to the Assignee, shall have been given to the
Borrower and the Administrative Agent by such Bank and the Assignee; (ii)
such Bank and its Assignee shall have delivered to the Borrower and the
Administrative Agent an Assignment and Acceptance in the form of Exhibit E
---------
("Assignment and Acceptance"), requiring, among other things, that any
-------------------------
Assignee agree to be bound by the UK/US Intercreditor Agreement
82
and the Securitization Intercreditor Agreement and (iii) the assignor Bank
or Assignee has paid to the Administrative Agent a processing fee in the
amount of $3,500, and, provided, further any assignment shall be subject to
the restrictions of the Warrant Agreement.
(b) From and after the date that the Administrative Agent notifies the
assignor Bank that it has received (and provided its consent with respect
to) an executed Assignment and Acceptance and payment of the above-
referenced processing fee, (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have the
rights and obligations of a Bank under the Loan Documents, and (ii) the
assignor Bank shall, to the extent that rights and obligations hereunder
and under the other Loan Documents have been assigned by it pursuant to
such Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Loan Documents.
(c) Immediately upon each Assignee's making its processing fee payment
under the Assignment and Acceptance, this Agreement shall be deemed to be
amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Commitments
arising therefrom. The Commitment allocated to each Assignee shall reduce
such Commitments of the assigning Bank pro tanto.
--- -----
(d) Any Bank may at any time sell to one or more commercial banks or
other Persons not Affiliates of the Borrower (a "Participant")
-----------
participating interests in any Loans, the Commitment of that Bank and the
other interests of that Bank (the "Originating Bank") hereunder and under
----------------
the other Loan Documents; provided, however, that (i) the Originating
-------- -------
Bank's obligations under this Agreement shall remain unchanged, (ii) the
Originating Bank shall remain solely responsible for the performance of
such obligations, (iii) the Borrower and the Administrative Agent shall
continue to deal solely and directly with the Originating Bank in
connection with the Originating Bank's rights and obligations under this
Agreement and the other Loan Documents, and (iv) no Bank shall transfer or
grant any participating interest under which the Participant has rights to
approve any amendment to, or any consent or waiver with respect to, this
Agreement or any other Loan Document, except to the extent such amendment,
consent or waiver would require unanimous consent of the Banks as described
in the first proviso to Section 10.1. In the case of any such
------- ------------
participation, the Participant shall be entitled to the benefit of Sections
--------
4.1, 4.3 and 10.5 as though it were also a Bank hereunder provided that all
--- --- ----
amounts payable by the Borrower hereunder shall be determined as if such
Originating Bank had not sold such participation. If amounts outstanding
under this Agreement are due and unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event of
Default, each Participant shall be deemed to have the right of set-off in
respect of its participating interest in amounts owing under this Agreement
to
83
the same extent as if the amount of its participating interest were owing
directly to it as a Bank under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Bank
may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR (S)203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
10.10 Confidentiality. Each Bank agrees to take and to cause its
---------------
Affiliates to take normal and reasonable precautions and exercise due care to
main tain the confidentiality of all information identified as "confidential" or
"secret" by the Borrower and provided to it by the Borrower or any of its
Subsidiaries, or by the Administrative Agent on the Borrower's or Subsidiary's
behalf, under this Agreement or any other Loan Document, and neither it nor any
of its Affiliates shall use any such information other than in connection with
or in enforcement of this Agreement and the other Loan Documents or in
connection with other business now or hereafter existing or contemplated with
the Borrower or any of its Subsidiaries; except to the extent such information
(i) was or becomes generally available to the public other than as a result of
disclosure by the Bank, or (ii) was or becomes available on a non-confidential
basis from a source other than the Borrower, provided that such source is not
bound by a confidentiality agreement with the Borrower known to the Bank;
provided, however, that any Bank may disclose such information (A) at the
--------
request or pursuant to any requirement of any Governmental Authority to which
-------
the Bank is subject or in connection with an examination of such Bank by any
such authority; (B) pursuant to subpoena or other court process; (C) when
required to do so in accordance with the provisions of any applicable
requirement of law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which the Administrative Agent, any Bank, or their
respective Affiliates may be party; (E) to the extent reasonably required in
connection with the exercise of any remedy hereunder or under any other Loan
Document; (F) to such Bank's independent auditors and other professional
advisors; (G) to any Participant or Assignee, actual or potential, or such
Bank's direct or indirect contractual counterparties in swap agreements or to
legal counsel, accountants and other professional advisors to such
counterparties provided that such Person agrees in writing to keep such
information confidential to the same extent required of the Banks hereunder; (H)
as to any Bank or its Affiliate, as expressly permitted under the terms of any
other document or agreement regarding confidentiality to which the Borrower or
any of its Subsidiaries is party or is deemed party with such Bank or such
Affiliate; and (I) to its Affiliates.
10.11 Set-off. In addition to any rights and remedies of the Banks
-------
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank is authorized at any time and from time to time, without
prior notice to the Borrower, any such notice being waived by the Borrower to
the fullest extent permitted by law, to set off and apply any and all deposits
84
(general or special, time or demand, provisional or final) (including deposits
in other currencies in amounts determined at the Spot Rate on the date of set-
off) at any time held by, and other indebtedness at any time owing by, such Bank
to or for the credit or the account of the Borrower against any and all
Obligations owing to such Bank, now or hereafter existing, irrespective of
whether or not the Administrative Agent or such Bank shall have made demand
under this Agreement or any Loan Document and although such Obligations may be
contingent or unmatured. Each Bank agrees promptly to notify the Borrower and
the Administrative Agent after any such set-off and application made by such
Bank; provided, however, that the failure to give such notice shall not affect
-------- -------
the validity of such set-off and application.
10.12 Notification of Addresses, Lending Offices, Etc. Each Bank shall
-----------------------------------------------
notify the Administrative Agent in writing of any changes in the address to
which notices to the Bank should be directed, of addresses of any Lending
Office, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as the Administrative
Agent shall reasonably request.
10.13 Counterparts. This Agreement may be executed in any number of
------------
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
10.14 Severability. The illegality or unenforceability of any provision
------------
of this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
10.15 No Third Parties Benefitted. This Agreement is made and entered
---------------------------
into for the sole protection and legal benefit of the Borrower, the Banks, the
Administrative Agent and the Administrative Agent-Related Persons, and their
permitted successors and assigns, and no other Person shall be a direct or
indirect legal beneficiary of, or have any direct or indirect cause of action or
claim in connection with, this Agreement or any of the other Loan Documents.
10.16 Governing Law and Jurisdiction.
------------------------------
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE ADMINISTRATIVE
AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND
BY EXECUTION AND DELIVERY OF
85
THIS AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE AGENT, AND
THE BANKS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
--------------------
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN
SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED
HERETO. THE BORROWER, THE ADMINISTRATIVE AGENT, AND THE BANKS EACH WAIVE
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE
MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
10.17 Waiver of Jury Trial. THE BORROWER, THE BANKS, AND THE
--------------------
ADMINISTRATIVE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY ADMINISTRATIVE AGENT-RELATED
PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS, OR OTHERWISE. THE BORROWER, THE BANKS, AND THE ADMINISTRATIVE AGENT EACH
AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL
WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT
THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
10.18 Judgment. If, for the purposes of obtaining judgment in any court,
--------
it is necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of exchange used shall be that at which
in accordance with normal banking procedures the Administrative Agent could
purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of the Borrower
in respect of any such sum due from it to the Administrative Agent hereunder or
under the other Loan Documents shall, notwithstanding any judgment in a currency
(the "Judgment Currency") other than that in which such sum is denominated in
-----------------
accordance with the applicable provisions of this Agreement (the "Agreement
---------
Currency"), be discharged only to the extent that
--------
86
on the Business Day following receipt by the Administrative Agent of any sum
adjudged to be so due in the Judgment Currency, the Administrative Agent may in
accordance with normal banking procedures purchase the Agreement Currency with
the Judgment Currency. If the amount of the Agreement Currency so purchased is
less than the sum originally due to the Administrative Agent in the Agreement
Currency, the Borrower agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify the Administrative Agent or the Person to whom such
obligation was owing against such loss. If the amount of the Agreement Currency
so purchased is greater than the sum originally due to the Administrative Agent
in such currency, the Administrative Agent agrees to return the amount of any
excess to the Borrower (or to any other Person who may be entitled thereto under
applicable law).
10.19 Entire Agreement. This Agreement, together with the other Loan
----------------
Documents, embodies the entire agreement and understanding among the Borrower,
the Banks and the Administrative Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
87
Delivered at Chicago, Illinois as of the day and year first above written.
APW LTD.
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Title: Asst. Treasurer
----------------------------------
S-1
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Administrative Agent and a Bank
By: /s/ X. X. Xxxxxxxx
-----------------------------
Title:___________________________
S-2
BANK ONE, NA (Main Office Chicago),
as Syndication Agent and as a Bank
By: /s/ Xxxxxx X. Xxxxx
------------------------------
Name: Xxxxxx X. Xxxxx
----------------------------
Title: Senior Vice President
---------------------------
S-3
THE CHASE MANHATTAN BANK,
as Documentation Agent and a Bank
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
--------------------------------
Title: VP
-------------------------------
S-4
FIRST UNION NATIONAL BANK,
as a Bank
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxx
-------------------------------
Title: Senior Vice President/Director
------------------------------
S-5
LASALLE BANK NATIONAL ASSOCIATION,
as a Bank
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxx
---------------------------
Title: First Vice President
--------------------------
S-6
THE ROYAL BANK OF SCOTLAND PLC,
as a Bank
By: /s/ X. X. Xxxxx
---------------------------
Name: X. X. Xxxxx
-------------------------
Title: Senior Manager
------------------------
S-7
THE BANK OF TOKYO-MITSUBISHI, LTD.,
CHICAGO BRANCH, as a Bank
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxxx
---------------------------
Title: Deputy General Manager
--------------------------
Attention: Xxxxx Yamanaku
Facsimile: (000)000-0000
S-8
CREDIT LYONNAIS CHICAGO BRANCH,
as a Bank
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------
Title: Vice President
------------------------
S-9
U.S. BANK NATIONAL ASSOCIATION,
as a Bank
By: /s/ Xxxx Xxxxxx
---------------------------
Name: Xxxx Xxxxxx
-------------------------
Title: AVP
------------------------
FIRSTAR BANK, N.A.,
as a Bank
By: /s/ Xxxx Xxxxxx
---------------------------
Name: Xxxx Xxxxxx
-------------------------
Title: AVP
------------------------
Its Attorney-In-Fact
S-10
THE FUJI BANK, LIMITED,
as a Bank
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
-----------------------------------
Title: Senior Vice President & Group Head
----------------------------------
S-11
FLEET NATIONAL BANK,
as a Bank
By: /s/ Xxxxxx Xxxxxxx
-----------------------------
Name: Xxxxxx Xxxxxxx
---------------------------
Title: Vice President
--------------------------
S-12
THE DAI-ICHI KANGYO BANK, LTD.,
as a Bank
By: /s/ Nobuyasu Fukatsu
----------------------------
Name: Nobuyasu Fukatsu
--------------------------
Title: General Manager
-------------------------
S-13
M&I XXXXXXXX & XXXXXX BANK,
as a Bank
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------
Title: Vice President
-----------------------
S-14
BNP PARIBAS,
as a Bank
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxxx X. Xxxxxx
--------------------------------------------
Title: Director
-------------------------------------------
By: /s/ Xxxxxxx X. Xxxx
----------------------------------------------
Name: Xxxxxxx X. Xxxx
--------------------------------------------
Title: Central Region Manager & Managing Director
-------------------------------------------
S-15
SOCIETE GENERALE,
as a Bank
By: /s/ Xxxx X. X. Xxxxxxx Xx.
---------------------------
Name: Xxxx X. X. Xxxxxxx Xx.
-------------------------
Title: Director
------------------------
X-00
XXX XXXX XX XXX XXXX,
as a Bank
By: /s/ Xxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxx X. Xxxxx
---------------------------
Title: Assistant Vice President
--------------------------
S-17
WACHOVIA BANK, N.A.,
as a Bank
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxxxx
-------------------------
Title: Senior Vice President
------------------------
S-18
SUMITOMO MITSUI BANKING CORPORATION
as a Bank
By: /s/ C. Xxxxxxx Xxxxxxx
---------------------------
Name: C. Xxxxxxx Xxxxxxx
-------------------------
Title: Senior Vice President
------------------------
S-19
THE MITSUBISHI TRUST & BANKING CORPORATION, as a Bank
By: /s/ Xxxxxxxxx Xxxxxxx
-----------------------------
Name: Xxxxxxxxx Xxxxxxx
---------------------------
Title: Senior Vice President
--------------------------
S-20
EXHIBIT E
FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance") dated as of _____________, is made between
______________________________ (the "Assignor") and __________________________
(the "Assignee").
RECITALS
WHEREAS, the Assignor is party to that certain Amended and Restated
Multicurrency Credit Agreement dated as of May 15, 2001 (as amended, amended and
restated, modified, supplemented or renewed, the "Credit Agreement") among APW,
Ltd., (the "Borrower"), the several financial institutions from time to time
party thereto (including the Assignor, the "Banks"), Bank One, NA as Syndication
Agent, The Chase Manhattan Bank, as Documentation Agent and Bank of America,
National Association, as administrative agent for the Banks (the "Administrative
Agent"). Any terms defined in the Credit Agreement and not defined in this
Assignment and Acceptance are used herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to making Loans (the "Committed Loans") to the Borrower in an
aggregate amount not to exceed $__________ (the "Commitment");
WHEREAS, [the Assignor has made Committed Loans in the aggregate
principal amount of $__________ [no Committed Loans are outstanding under the
Credit Agreement];
WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all] rights and obligations of the Assignor under the Credit Agreement in
respect of its Commitment, [together with a corresponding portion of each of its
outstanding Committed Loans and its interest in the Letter of Credit Usage] in
an amount equal to $__________ (the "Assigned Amount") on the terms and subject
to the conditions set forth herein and the Assignee wishes to accept assignment
of such rights and to assume such obligations from the Assignor on such terms
and subject to such conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
E-1
1. Assignment and Acceptance.
(a) Subject to the terms and conditions of this Assignment and
Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from
the Assignor, without recourse and without representation or warranty (except as
provided in this Assignment and Acceptance) __% (the "Assignee's Percentage
Share") of (A) the Commitment [and the Committed Loans and the Letter of Credit
Usage] of the Assignor and (B) all related rights, benefits, obligations,
liabilities and indemnities of the Assignor under and in connection with the
Credit Agreement and the Loan Documents.
[If appropriate, add paragraph specifying payment to Assignor by
Assignee of outstanding principal of, accrued interest on, and fees with respect
to, Committed Loans assigned.]
(b) With effect on and after the Effective Date (as defined in
Section 5 hereof), the Assignee shall be a party to the Credit Agreement and
succeed to all of the rights and be obligated to perform all of the obligations
of a Bank under the Credit Agreement, including the requirements concerning
confidentiality and the payment of indemnification, with a Commitment in an
amount equal to the Assigned Amount. The Assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Bank. It is the intent
of the parties hereto that the Commitment of the Assignor shall, as of the
Effective Date, be reduced by an amount equal to the Assigned Amount and the
Assignor shall relinquish its rights and be released from its obligations under
the Credit Agreement to the extent such obligations have been assumed by the
Assignee; provided, however, the Assignor shall not relinquish its rights under
Sections 4.1, 4.3, 11.4 and 10.6 of the Credit Agreement to the extent such
rights relate to the time prior to the Effective Date.
(c) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignee's Commitment will be $__________.
(d) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignor's Commitment will be $__________.
2. Payments.
(a) As consideration for the sale, assignment and transfer
contemplated in Section 1 hereof, the Assignee shall pay to the Assignor on the
Effective Date in immediately available funds an amount [equal to
$__________][required under separate letter], representing the Assignee's Pro
Rata Share of the principal amount of all Committed Loans.
E-2
(b) The [Assignor] [Assignee] further agrees to pay to the
Administrative Agent a processing fee in the amount specified in Section 10.9(a)
of the Credit Agreement.
3. Reallocation of Payments.
Any interest, fees and other payments accrued to the Effective Date with
respect to the Commitment [, the Letter of Credit Usage and the Committed Loans]
shall be for the account of the Assignor. Any interest, fees and other payments
accrued on and after the Effective Date with respect to the Assigned Amount
shall be for the account of the Assignee. Each of the Assignor and the Assignee
agrees that it will hold in trust for the other party any interest, fees and
other amounts which it may receive to which the other party is entitled pursuant
to the preceding sentence and pay to the other party any such amounts which it
may receive promptly upon receipt.
4. Independent Credit Decision.
The Assignee (a) acknowledges that it has received a copy of the Credit
Agreement and the Schedules and Exhibits thereto, together with copies of the
most recent financial statements referred to in Section 7.1(a) and (b) of the
Credit Agreement, and such other documents and information as it has deemed
appropriate to make its own credit and legal analysis and decision to enter into
this Assignment and Acceptance; and (b) agrees that it will, independently and
without reliance upon the Assignor, the Administrative Agent or any other Bank
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit and legal decisions in taking or not
taking action under the Credit Agreement.
5. Effective Date; Notices.
(a) As between the Assignor and the Assignee, the effective date for
this Assignment and Acceptance shall be __________, 2001 (the "Effective Date");
provided that the following conditions precedent have been satisfied on or
before the Effective Date:
(i) this Assignment and Acceptance shall be executed and
delivered by the Assignor and the Assignee;
(ii) the consent of the Administrative Agent required for an
effective assignment of the Assigned Amount by the Assignor to the Assignee
under Section 10.9(a) of the Credit Agreement shall have been duly obtained and
shall be in full force and effect as of the Effective Date;
(iii) the Assignee shall pay to the Assignor all amounts due
to the Assignor under this Assignment and Acceptance;
E-3
(iv) the Assignee shall have complied with Section 9.10 of
the Credit Agreement (if applicable);
(v) the processing fee referred to in Section 2(b) hereof
and in Section 10.9(a) of the Credit Agreement shall have been paid to the
Administrative Agent; and
(vi) the Assignor shall have assigned and the Assignee shall
have assumed a percentage equal to the Assignee's Percentage Share of the rights
and obligations of the Assignor under the Credit Agreement (if such agreement
exists).
(b) Promptly following the execution of this Assignment and
Acceptance, the Assignor shall deliver to each of the Borrower and the
Administrative Agent for acknowledgment by the Administrative Agent, a Notice of
Assignment substantially in the form attached hereto as Schedule 1.
[6. Administrative Agent. [INCLUDE ONLY IF ASSIGNOR IS Administrative
Agent]
(a) The Assignee hereby appoints and authorizes the Assignor to
take such action as administrative agent on its behalf and to exercise such
powers under the Credit Agreement as are delegated to the Administrative Agent
by the Banks pursuant to the terms of the Credit Agreement.
(b) The Assignee shall assume no duties or obligations held by the
Assignor in its capacity as Administrative Agent under the Credit Agreement.]
7. Withholding Tax.
The Assignee (a) represents and warrants to the Bank, the Administrative
Agent and each of the Borrower that under applicable law and treaties no tax
will be required to be withheld by the Bank with respect to any payments to be
made to the Assignee hereunder, (b) agrees to furnish (if it is organized under
the laws of any jurisdiction other than the United States or any State thereof)
to the Administrative Agent and each of the Borrower prior to the time that the
Administrative Agent or any of the Borrower is required to make any payment of
principal, interest or fees hereunder, duplicate executed originals of U.S.
Internal Revenue Service Form W-8ECI, U.S. Internal Revenue Service Form W-8BEN
(wherein the Assignee claims entitlement to the benefits of a tax treaty that
provides for a complete exemption from U.S. federal income withholding tax on
all payments hereunder) or U.S. Internal Revenue Service Form W-8IMY and agrees
to provide new Forms W-8ECI, W-8BEN or W-8IMY upon the expiration of any
previously delivered form or comparable statements in accordance with applicable
U.S. law and regulations and amendments thereto, duly executed and completed by
E-4
the Assignee, and (c) agrees to comply with all applicable U.S. laws and
regulations with regard to such withholding tax exemption.
8. Representations and Warranties.
(a) The Assignor represents and warrants that (i) it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any Lien or other adverse claim; (ii) it is
duly organized and existing and it has the full power and authority to take, and
has taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any Person are required (other than any already given or obtained)
for its due execution, delivery and performance of this Assignment and
Acceptance, and apart from any agreements or undertakings or filings required by
the Credit Agreement, no further action by, or notice to, or filing with, any
Person is required of it for such execution, delivery or performance; and (iv)
this Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against the Assignor in accordance with the terms hereof, subject, as to
enforcement, to bankruptcy, insolvency, moratorium, reorganization and other
laws of general application relating to or affecting creditors' rights and to
general equitable principles.
(b) The Assignor makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto. The
Assignor makes no representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency, financial condition or statements
of each of the Borrower , or the performance or observance by each of the
Borrower, of any of its respective obligations under the Credit Agreement or any
other instrument or document furnished in connection therewith.
(c) The Assignee represents and warrants that (i) it is duly
organized and existing and it has full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance, and to
fulfill its obligations hereunder; (ii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than any already
given or obtained) for its due execution, delivery and performance of this
Assignment and Acceptance; and apart from any agreements or undertakings or
filings required by the Credit Agreement, no further action by, or notice to, or
filing with, any Person is required of it for such execution, delivery or
performance; (iii) this Assignment and Acceptance has been duly executed and
delivered by it and constitutes the legal, valid and binding obligation of the
Assignee, enforceable against the Assignee in accordance with the
E-5
terms hereof, subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles; and (iv) it is an
Eligible Assignee.
9. Further Assurances.
The Assignor and the Assignee each hereby agree to execute and deliver such
other instruments, and take such other action, as either party may reasonably
request in connection with the transactions contemplated by this Assignment and
Acceptance, including the delivery of any notices or other documents or
instruments to each of the Borrower or the Administrative Agent, which may be
required in connection with the assignment and assumption contemplated hereby.
10. Miscellaneous.
(a) Any amendment or waiver of any provision of this Assignment
and Acceptance shall be in writing and signed by the parties hereto. No failure
or delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance shall be without prejudice to any
rights with respect to any other or further breach thereof.
(b) All payments made hereunder shall be made without any set-off
or counterclaim.
(c) The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.
(d) This Assignment and Acceptance may be executed in any number
of counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF ILLINOIS. The Assignor and
the Assignee each irrevocably submits to the non-exclusive jurisdiction of any
State or Federal court sitting in Illinois over any suit, action or proceeding
arising out of or relating to this Assignment and Acceptance and irrevocably
agrees that all claims in respect of such action or proceeding may be heard and
determined in such Illinois state or Federal court. Each party to this
Assignment and Acceptance hereby irrevocably waives, to the fullest extent it
may effectively do so, the defense of an inconvenient forum to the maintenance
of such action or proceeding.
E-6
(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH THIS ASSIGNMENT AND ACCEPTANCE, THE CREDIT AGREEMENT, ANY
RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, OR
STATEMENTS (WHETHER ORAL OR WRITTEN).
[Other provisions to be added as may be negotiated between the
Assignor and the Assignee, provided that such provisions are not inconsistent
with the Credit Agreement.]
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
[ASSIGNOR]
By:
Title:
By:
Title:
Address:
[ASSIGNEE]
By:
Title:
By:
Title:
Address:
E-7
SCHEDULE 1
NOTICE OF ASSIGNMENT AND ACCEPTANCE
_______________, 2001
Bank of America, National
Association, as Administrative Agent
000 X. XxXxxxx
Xxxxxxx, XX 00000
APW Ltd.
[Address of Borrower]
Ladies and Gentlemen:
We refer to the Amended and Restated Multicurrency Credit Agreement dated
as of May 15, 2001 (as amended, amended and restated, modified, supplemented or
renewed from time to time the "Credit Agreement") among APW Ltd. (the
"Borrower"), the Banks referred to therein, Bank One, NA, as Syndication Agent,
The Chase Manhattan Bank as Documentation Agent and Bank of America, National
Association as administrative agent for the Banks (the "Administrative Agent").
Terms defined in the Credit Agreement are used herein as therein defined.
1. We hereby give you notice of, and request your consent to, the
assignment by __________________ (the "Assignor") to _______________ (the
"Assignee") of _____% of the right, title and interest of the Assignor in and to
the Credit Agreement (including, without limitation, the right, title and
interest of the Assignor in and to the Commitments of the Assignor [, all
outstanding Loans made by the Assignor and the Letter of Credit Usage]) pursuant
to the Assignment and Acceptance Agreement attached hereto (the "Assignment and
Acceptance"). Before giving effect to such assignment, the Assignor's Commitment
is $ ___________ [, the aggregate amount of its outstanding committed Loans is
$_____________ and the Letter of Credit Usage is $_____________].
2. The Assignee agrees that, upon receiving the consent of the
Administrative Agent and each of the Borrower to such assignment, the Assignee
will be bound by the terms of the Credit Agreement as fully and to the same
extent as if the Assignee were the Bank originally holding such interest in the
Credit Agreement.
E-8
3. The following administrative details apply to the Assignee:
(A) Notice Address:
Assignee name: __________________________
Address: _______________________________
_______________________________
_______________________________
Attention: _____________________________
Telephone: (___) _______________________
Telecopier: (___) _______________________
(B) Payment Instructions:
Account No.: ____________________________
At: ______________________________
______________________________
______________________________
Reference: ______________________________
Attention: ______________________________
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Notice
of Assignment and Acceptance to be executed by their respective duly authorized
officials, officers or agents as of the date first above mentioned.
Very truly yours,
[NAME OF ASSIGNOR]
By:
Title:
By:
Title:
E-9
[NAME OF ASSIGNEE]
By:
Title:
By:
Title:
ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Administrative Agent
By: _________________
Title: ______________
E-10
EXHIBIT F
FORM OF NOTE
$ Date:
FOR VALUE RECEIVED, APW Ltd., a Bermuda corporation (the "Borrower") hereby
unconditionally promises to pay to the order of
(the "Bank"): __________________________________________________________________
(a) prior to or on the Termination Date the principal amount of
[ ] Dollars ($______) or, if less, the aggregate unpaid principal
amount of Committed Loans advanced by the Bank to the Borrower pursuant to
the Amended and Restated Multicurrency Credit Agreement dated as of May 15,
2001 (as amended and in effect from time to time, the "Credit Agreement"),
among APW Ltd., various financial institutions, Bank One, NA, as
Syndication Agent, The Chase Manhattan Bank, as Documentation Agent and
Bank of America, National Association, as Administrative Agent; and
(b) interest on the principal balance hereof from time to time
outstanding from the date of this Note through and including the maturity
date hereof at the times and at the rates provided in the Credit Agreement.
This Note evidences borrowings under and has been issued by the Borrower in
accordance with the terms of the Credit Agreement. The Bank and any holder
hereof is entitled to the benefits of the Credit Agreement and the other Loan
Documents, and may enforce the agreements of the Borrower contained therein, and
any holder hereof may exercise the respective remedies provided for thereby or
otherwise available in respect thereof, all in accordance with the respective
terms thereof. All capitalized terms used in this Note and not otherwise defined
herein shall have the same meanings herein as in the Credit Agreement.
The Borrower irrevocably authorizes the Bank to make or cause to be made,
at or about the date of any Loan made to the Borrower or at the time of receipt
of any payment of principal of this Note, an appropriate notation on the grid
attached to this Note, or the continuation of such grid, or any other similar
record, including computer records, reflecting the making of such Loan or (as
the case may be) the receipt of such payment. The outstanding amount of the
Loans set forth on the grid attached to this Note, or the continuation of such
grid, or any other similar record, including computer records, maintained by the
Bank with respect to any Loans made to the Borrower shall be prima facie
evidence of the principal amount thereof owing and unpaid by the Borrower to the
Bank, but the failure to record, or any error in so recording, any such amount
on any such grid, continuation or other record shall not limit or otherwise
affect the obligation of the Borrower hereunder or under the Credit Agreement to
make payments of principal and of interest on this Note when due.
F-1
The Borrower has the right in certain circumstances and the obligation
under certain other circumstances to prepay the whole or part of the principal
of this Note severally owing by the Borrower on the terms and conditions
specified in the Credit Agreement.
If any one or more of the Events of Default shall occur and be continuing
with respect to the Borrower, the entire unpaid principal amount of this Note
owing by the Borrower and all of the unpaid interest accrued thereon may become
or be declared due and payable in the manner and with the effect provided in the
Credit Agreement.
No delay or omission on the part of the Bank or any holder hereof in
exercising any right hereunder shall operate as a waiver of such right or of any
other rights of the Bank or such holder, nor shall any delay, omission or waiver
on any one occasion be deemed a bar or waiver of the same or any other right on
any further occasion.
Except to the extent otherwise provided in the Credit Agreement, the
Borrower hereby waives presentment, demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this Note, and assents to any extension or
postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of collateral and to the addition or release
of any other party or person primarily or secondarily liable.
THIS NOTE AND THE OBLIGATIONS OF THE BORROWER HEREUNDER SHALL FOR ALL
PURPOSES BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF
ILLINOIS.
IN WITNESS WHEREOF, the undersigned has caused this Note to be executed as
of the day and year first above written.
APW Ltd.
By:
Title:
F-2
====================================================================================================================================
Amount of Amount of Principal Unpaid Principal
Revolving Repaid Balance
Loan Made
------------------ ---------------------------------------------
Base Offshore Interest Base Offshore Base Offshore Notations
Date Rate Rate Currency Period (If Rate Rate Rate Rate Total Made By
Applicable)
====================================================================================================================================
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
F-3
EXHIBIT H
FORM OF SUBORDINATION PROVISIONS
SECTION 1 Definitions. The following terms when used in this Section
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Agent" means the administrative agent under the Credit Agreement,
together with any successors or assigns.
"Bank" means each financial institution that is a signatory to the
Credit Agreement.
"Borrower" means APW Ltd., a Bermuda corporation.
"Credit Agreement" means the Amended and Restated Multicurrency Credit
Agreement, dated as of May 15, 2001 among APW Ltd., various financial
institutions, Bank One, NA as Syndication Agent, The Chase Manhattan Bank,
as Documentation Agent, and Bank of America, National Association, as
Administrative Agent, as the same may at any time be amended, restated,
modified, supplemented or refinanced.
"Junior Creditor" means a holder of a Junior Liability.
"Junior Liabilities" means all Liabilities of the Borrower to the
Borrower or any Subsidiary of the Borrower.
"Liabilities" means all Debt of the Borrower, however created, arising
or evidenced, whether direct or indirect, absolute or contingent, or now or
hereafter existing, or due or to become due.
"Loan Documents" means the Credit Agreement, all notes, all
guaranties, all fee letters, all letters of credit applications and all
other documents delivered to the Agent and the Bank in connection
therewith.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, the Borrower or Guarantor arising
under the Credit Agreement or any other Loan Document, whether direct or
indirect (including those acquired by assignment), absolute or contingent,
due or to become due, now existing or hereafter arising and including
interest that accrues after the commencement of any
H-1
proceeding under any debtor relief laws by or against the Borrower,
Guarantor or any Subsidiary or Affiliate thereof.
"Person" means any natural person, corporation, partnership, trust,
limited liability company, incorporated or unincorporated association,
joint venture, joint stock company, government (or an agency or political
subdivision thereof) or other entity, whether acting in an individual,
fiduciary or other capacity.
"Post-Commencement Interest and Expense Claims" means any and all
claims arising after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding for interest on Senior Liabilities at
the rate (including any applicable post-default rate) set forth in the
instrument evidencing or agreement governing such Senior Liabilities or for
expense reimbursement or indemnification on the terms set forth in such
instrument or agreement, whether or not such claims are enforceable,
allowable or allowed in such bankruptcy, insolvency, receivership or
similar proceeding and even if such claims are not enforceable or allowed
therein.
"Senior Liabilities" means the Obligations plus the Post-Commencement
Interest and Expense Claims.
All capitalized terms not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.
SECTION 2 Agreement to Subordinate. The Borrower and the Junior Creditors
agree that the Junior Liabilities are subordinated in right of payment, to the
extent and in the manner provided in this Section , to the prior payment in full
in cash of all Senior Liabilities (whether outstanding on the date hereof or
hereafter created, incurred, assumed or guaranteed), and that the subordination
is for the benefit of the holders of the Senior Liabilities.
SECTION 3 Liquidation; Dissolution; Bankruptcy. Upon any distribution of
assets of the Borrower or upon any dissolution, winding up, total or partial
liquidation or reorganization of the Borrower, whether voluntary or involuntary,
in bankruptcy, insolvency, receivership or similar proceeding or upon assignment
for the benefit of creditors or any marshaling of the Borrower's assets and
liabilities:
a. the holders of all Senior Liabilities shall first be entitled to
receive payment in full of all Senior Liabilities (including Post-
Commencement Interest and Expense Claims) before the Junior Creditors are
entitled to receive any payment on account of the principal of, premium, if
any, and interest on the Junior Liabilities or any undertaking in respect
to the Junior Liabilities; and
H-2
b. any payment or distribution of assets of the Borrower of any
kind or character from any source, whether in cash, property or securities,
to which the Junior Creditors would be entitled (by set-off or otherwise),
except for this Section shall be paid by the liquidating trustee or agent
or other Person making such a payment or distribution directly to the
holders of such Senior Liabilities or their representatives to the extent
necessary to make payment in full of all such Senior Liabilities (including
Post-Commencement Interest and Expense Claims) remaining unpaid, after
giving effect to any concurrent payment or distribution to the holders of
Senior Liabilities.
SECTION 4 Default on Senior Liabilities. No payment (by set-off or
otherwise) may be made by or on behalf of the Borrower, on account of the
principal of, premium, if any, or interest on the Junior Liabilities (including
any repurchases of Junior Liabilities), or on account of any redemption
provisions of the Junior Liabilities or any undertaking in respect of the Junior
Liabilities, for cash or property, (i) upon the maturity of any Senior
Liabilities, by lapse of time, acceleration (unless waived) or otherwise, unless
and until all principal of, premium, if any, and the interest on and fees and
other amounts in respect of such Senior Liabilities are paid in full, or (ii) in
the event of default in the payment of any principal of, premium, if any, or
interest on or fee or other amount in respect of Senior Liabilities, when it
becomes due and payable, whether at maturity or at a date fixed for prepayment
or by declaration or otherwise (a "Payment Default"), unless and until such
Payment Default has been cured or waived or otherwise has ceased to exist.
Upon the happening of an Event of Default (other than a Payment Default)
that permits the holders of Senior Liabilities to declare such Senior
Liabilities to be due and payable, then, unless and until such Event of Default
has been cured or waived or otherwise has ceased to exist, no payment (by set-
off or otherwise) may be made by or on behalf of the Borrower, on account of the
principal of, premium, if any, or interest on or other amount owing in respect
of the Junior Liabilities (including any repurchases of any of the Junior
Liabilities), or on account of any redemption provisions of the Junior
Liabilities or any undertaking in respect of the Junior Liabilities.
SECTION 5 Acceleration of Junior Liabilities. If payment of the Junior
Liabilities is accelerated because of default, the Borrower shall promptly
notify holders of Senior Liabilities of the acceleration.
SECTION 6 When Distributions Must Be Paid Over. In the event that,
notwithstanding the other provisions of this Agreement, the Junior Creditors
receive any payment or distribution of the Junior Liabilities when such payment
or distribution is prohibited by this Section , such payment or distribution
shall be held by the Junior Creditors in trust for the benefit of, and shall be
paid forthwith over and delivered, upon written request, to, the holders of
Senior Liabilities remaining unpaid or unprovided for or their representative
ratably according to aggregate principal amounts remaining unpaid on
H-3
account of such Senior Liabilities held or represented by each, for application
to the payment of all obligations with respect to Senior Liabilities remaining
unpaid, to the extent necessary to pay or to provide for the payment of all such
Obligations and Post-Commencement Interest and Expense Claims in full in
accordance with their terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Liabilities.
SECTION 7 Subrogation. After all Senior Liabilities are paid in full and
until the Junior Liabilities are paid in full, Junior Creditors shall be
subrogated (equally and ratably with all other indebtedness pari passu with the
Junior Liabilities) to the rights of holders of Senior Liabilities to receive
distributions applicable to Senior Liabilities to the extent that distributions
otherwise payable to the Junior Creditors have been applied to the payment of
Senior Indebtedness. A distribution made under this Section to holders of Senior
Liabilities that otherwise would have been made to Junior Creditors is not, as
between the Borrower and the Junior Creditors, a payment by the Borrower on the
Junior Liabilities. No holder of Senior Liabilities shall be obligated to
create, warrant, preserve or protect any such subrogation right or shall suffer
any loss or diminution of its rights hereunder if for any reason (including,
without limitation, the lack of enforceability or disallowance of any Post-
Commencement Interest and Expense Claim) such right of subrogation is not
available to any Junior Creditor.
SECTION 8 Relative Rights. This Section defines the relative rights of
Junior Creditors and holders of Senior Liabilities. Nothing in this section
shall:
(1) impair, as between the Borrower and the Junior Creditors, the
obligation of the Borrower, which is absolute and unconditional, to pay
principal of (and premium, if any) and interest on the Junior Liabilities
in accordance with their terms;
(2) affect the relative rights of the Junior Creditors and creditors
of the Borrower other than their rights in relation to holders of Senior
Liabilities; or
(3) prevent the Junior Creditors from exercising their available
remedies, subject to the rights of holders of Senior Liabilities to receive
distributions and payments otherwise payable to the Junior Creditors.
SECTION 9 Subordination May Not Be Impaired By Borrower. No right of any
holder of Senior Liabilities to enforce the subordination of the Junior
Liabilities shall be impaired by any act or failure to act by the Borrower or
any holder of Senior Liabilities or by the failure of the Borrower or any Junior
Creditor to comply with this Section .
Without in any way limiting the generality of the foregoing paragraph, the
holders of the Senior Liabilities may, at any time and from time to time,
without the consent of or notice
H-4
to the Junior Creditors, without incurring responsibility to the Junior
Creditors and without impairing or releasing the subordination provided in this
Section or the obligations hereunder of the Junior Creditors to the holders of
Senior Liabilities, do any one or more of the following: (a) change the manner,
place or terms of payment or extend the time or payment of, or renew or alter,
Senior Liabilities or any instrument evidencing the same or any agreement under
which Senior Liabilities are outstanding; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Liabilities; (c) release any Person in any manner for the collection of Senior
Liabilities; and (d) exercise or refrain from exercising any rights against the
Borrower or any other Person; provided, however, that in no event shall any such
actions limit the right of the Junior Creditors to take any action to accelerate
the maturity of the Junior Liabilities in accordance with the provisions thereof
or to pursue any rights or remedies under the documents evidencing the Junior
Liabilities or under applicable laws if the taking of such action does not
otherwise violate the terms of this Section.
SECTION 10 Amendments. The provisions of this Section shall not be amended
or modified in a manner adverse to the holders of Senior Liabilities without the
written consent of the holders of all Senior Liabilities.
SECTION 11 Governing Law; Severability of Provisions. This Section shall be
construed in accordance with and governed by the internal laws of the State of
Illinois. Wherever possible, each provision of this Section shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Section shall be prohibited by or invalid under such law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Section.
H-5
