Exhibit 10.1
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CREDIT AGREEMENT
DATED AS OF JULY 23, 2004
AMONG
TITAN INTERNATIONAL, INC.,
AS THE COMPANY
LASALLE BANK NATIONAL ASSOCIATION,
AND GENERAL ELECTRIC CAPITAL CORPORATION,
AS INITIATING LENDERS,
AND
LASALLE BANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT
AND
GENERAL ELECTRIC CAPITAL CORPORATION,
AS CO-AGENT
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SECTION 1 DEFINITIONS................................................................................. 1
1.1 Definitions................................................................................. 1
1.2 Other Interpretive Provisions............................................................... 18
SECTION 2 COMMITMENTS OF THE LENDERS; BORROWING, CONVERSION AND LETTER OF CREDIT PROCEDURES........... 19
2.1 Commitments................................................................................. 19
2.1.1 Revolving Loan Commitment........................................................ 19
2.1.2 Intentionally omitted............................................................ 19
2.1.3 L/C Commitment................................................................... 19
2.2 Loan Procedures............................................................................. 19
2.2.1 Various Types of Loans........................................................... 20
2.2.2 Borrowing Procedures............................................................. 20
2.2.3 Conversion and Continuation Procedures........................................... 20
2.3 Letter of Credit Procedures................................................................. 21
2.3.1 L/C Applications................................................................. 21
2.3.2 Participations in Letters of Credit.............................................. 22
2.3.3 Reimbursement Obligations........................................................ 22
2.3.4 Funding by Lenders to Issuing Lender............................................. 23
2.4 Commitments Several......................................................................... 24
2.5 Certain Conditions.......................................................................... 24
SECTION 3 EVIDENCING OF LOANS......................................................................... 24
3.1 Notes....................................................................................... 24
3.2 Recordkeeping............................................................................... 24
SECTION 4 INTEREST.................................................................................... 25
4.1 Interest Rates.............................................................................. 25
4.2 Interest Payment Dates...................................................................... 25
4.3 Setting and Notice of LIBOR Rates........................................................... 25
4.4 Computation of Interest..................................................................... 25
SECTION 5 FEES........................................................................................ 26
5.1 Non-Use Fee................................................................................. 26
5.2 Letter of Credit Fees....................................................................... 26
5.3 Administrative Agent's Fees................................................................. 26
5.4 Closing Fee................................................................................. 26
5.5 Arrangement Fee............................................................................. 26
SECTION 6 REDUCTION OR TERMINATION OF THE REVOLVING COMMITMENT; PREPAYMENTS........................... 26
6.1 Reduction or Termination of the Revolving Commitment........................................ 26
6.1.1 Voluntary Reduction or Termination of the Revolving Commitment................... 27
6.1.2 Mandatory Reductions of Revolving Commitment..................................... 27
6.1.3 All Reductions of the Revolving Commitment....................................... 27
6.2 Prepayments................................................................................. 27
6.2.1 Voluntary Prepayments............................................................ 27
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6.3 Manner of Prepayments....................................................................... 28
6.3.1 All Prepayments.................................................................. 28
6.4 Repayments.................................................................................. 28
6.4.1 Revolving Loans.................................................................. 28
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES............................................. 28
7.1 Making of Payments.......................................................................... 28
7.2 Application of Certain Payments............................................................. 29
7.3 Due Date Extension.......................................................................... 29
7.4 Setoff...................................................................................... 29
7.5 Proration of Payments....................................................................... 29
7.6 Taxes....................................................................................... 30
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR LIBOR LOANS......................................... 31
8.1 Increased Costs............................................................................. 31
8.2 Basis for Determining Interest Rate Inadequate or Unfair.................................... 33
8.3 Changes in Law Rendering LIBOR Loans Unlawful............................................... 33
8.4 Funding Losses.............................................................................. 33
8.5 Right of Lenders to Fund through Other Offices.............................................. 34
8.6 Discretion of Lenders as to Manner of Funding............................................... 34
8.7 Mitigation of Circumstances; Replacement of Lenders......................................... 34
8.8 Conclusiveness of Statements; Survival of Provisions........................................ 35
SECTION 9 REPRESENTATIONS AND WARRANTIES.............................................................. 35
9.1 Organization................................................................................ 35
9.2 Authorization; No Conflict.................................................................. 35
9.3 Validity and Binding Nature................................................................. 35
9.4 Financial Condition......................................................................... 36
9.5 No Material Adverse Change.................................................................. 36
9.6 Litigation and Contingent Liabilities....................................................... 36
9.7 Ownership of Properties; Liens.............................................................. 36
9.8 Equity Ownership; Subsidiaries.............................................................. 36
9.9 Pension Plans............................................................................... 36
9.10 Investment Company Act...................................................................... 37
9.11 Public Utility Holding Company Act.......................................................... 37
9.12 Regulation U................................................................................ 37
9.13 Taxes....................................................................................... 37
9.14 Solvency, etc............................................................................... 38
9.15 Environmental Matters....................................................................... 38
9.16 Insurance................................................................................... 39
9.17 Real Property............................................................................... 39
9.18 Information................................................................................. 39
9.19 Intellectual Property....................................................................... 39
9.20 Burdensome Obligations...................................................................... 40
9.21 Labor Matters............................................................................... 40
9.22 No Default.................................................................................. 40
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9.23 Subordinated Debt........................................................................... 40
SECTION 10 AFFIRMATIVE COVENANTS....................................................................... 40
10.1 Reports, Certificates and Other Information................................................. 40
10.1.1 Annual Report.................................................................... 40
10.1.2 Interim Reports.................................................................. 41
10.1.3 Compliance Certificates.......................................................... 41
10.1.4 Notice of Default, Litigation and ERISA Matters.................................. 41
10.1.5 Borrowing Base Certificates...................................................... 42
10.1.6 Management Reports............................................................... 42
10.1.7 Projections...................................................................... 42
10.1.8 Subordinated Debt Notices........................................................ 43
10.1.9 Other Information................................................................ 43
10.2 Books, Records and Inspections.............................................................. 43
10.3 Maintenance of Property; Insurance.......................................................... 43
10.4 Compliance with Laws; Payment of Taxes and Liabilities...................................... 44
10.5 Maintenance of Existence, etc............................................................... 45
10.6 Use of Proceeds............................................................................. 45
10.7 Employee Benefit Plans...................................................................... 45
10.8 Environmental Matters....................................................................... 46
10.9 Further Assurances.......................................................................... 46
10.10 Deposit Accounts............................................................................ 47
10.11 Intentionally omitted....................................................................... 47
10.12 Syndication................................................................................. 47
SECTION 11 NEGATIVE COVENANTS.......................................................................... 47
11.1 Debt........................................................................................ 48
11.2 Liens....................................................................................... 49
11.3 Operating Leases............................................................................ 50
11.4 Restricted Payments......................................................................... 50
11.6 Modification of Organizational Documents.................................................... 51
11.7 Transactions with Affiliates................................................................ 51
11.8 Unconditional Purchase Obligations.......................................................... 51
11.9 Inconsistent Agreements..................................................................... 51
11.10 Business Activities; Issuance of Equity..................................................... 52
11.11 Investments................................................................................. 52
11.12 Restriction of Amendments to Certain Documents.............................................. 53
11.13 Fiscal Year. Not change its Fiscal Year..................................................... 53
11.14 Financial Covenants......................................................................... 53
11.14.1 Minimum Book Value............................................................... 53
11.14.2 Fixed Charge Coverage Ratio...................................................... 53
11.14.3 Collateral Coverage.............................................................. 53
11.15 Cancellation of Debt........................................................................ 53
SECTION 12 EFFECTIVENESS; CONDITIONS OF LENDING, ETC................................................... 54
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12.1 Initial Credit Extension.................................................................... 54
12.1.1 Notes............................................................................ 54
12.1.2 Authorization Documents.......................................................... 54
12.1.3 Consents, etc.................................................................... 54
12.1.4 Letter of Direction.............................................................. 54
12.1.5 Guaranty and Collateral Agreement................................................ 54
12.1.6 Perfection Certificate........................................................... 54
12.1.7 Real Estate Documents............................................................ 55
12.1.8 Appraisal........................................................................ 55
12.1.9 Opinions of Counsel.............................................................. 55
12.1.10 Insurance........................................................................ 55
12.1.11 Subordination.................................................................... 55
12.1.12 Payment of Fees.................................................................. 55
12.1.15 Intentionally omitted............................................................ 56
12.1.16 Search Results; Lien Terminations................................................ 56
12.1.17 Filings, Registrations and Recordings............................................ 56
12.1.18 Borrowing Base Certificate....................................................... 56
12.1.19 Closing Certificate, Consents and Permits........................................ 56
12.1.20 Other............................................................................ 56
12.2 Conditions.................................................................................. 56
12.2.1 Compliance with Warranties, No Default, etc...................................... 57
12.2.2 Confirmatory Certificate......................................................... 57
SECTION 13 EVENTS OF DEFAULT AND THEIR EFFECT.......................................................... 57
13.1 Events of Default........................................................................... 57
13.1.1 Non-Payment of the Loans, etc.................................................... 57
13.1.2 Non-Payment of Other Debt........................................................ 57
13.1.3 Other Material Obligations....................................................... 57
13.1.4 Bankruptcy, Insolvency, etc...................................................... 58
13.1.5 Non-Compliance with Loan Documents............................................... 58
13.1.6 Representations; Warranties...................................................... 58
13.1.7 Pension Plans.................................................................... 58
13.1.8 Judgments........................................................................ 58
13.1.9 Invalidity of Collateral Documents, etc.......................................... 59
13.1.10 Invalidity of Subordination Provisions, etc...................................... 59
13.1.11 Change of Control................................................................ 59
13.1.12 Material Adverse Effect.......................................................... 59
13.2 Effect of Event of Default.................................................................. 59
SECTION 14 THE AGENTS.................................................................................. 60
14.1 Appointment and Authorization............................................................... 60
14.2 Issuing Lender.............................................................................. 60
14.3 Delegation of Duties........................................................................ 60
14.4 Exculpation of Administrative Agent......................................................... 60
14.5 Reliance by Administrative Agent............................................................ 61
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14.6 Notice of Default........................................................................... 61
14.7 Credit Decision............................................................................. 62
14.8 Indemnification............................................................................. 62
14.9 Administrative Agent in Individual Capacity................................................. 63
14.10 Successor Administrative Agent.............................................................. 63
14.11 Collateral Matters.......................................................................... 63
14.12 Administrative Agent May File Proofs of Claim............................................... 64
14.13 Other Agents; Arrangers and Managers........................................................ 64
SECTION 15 GENERAL..................................................................................... 65
15.1 Waiver; Amendments.......................................................................... 65
15.2 Confirmations............................................................................... 65
15.3 Notices..................................................................................... 65
15.4 Computations................................................................................ 66
15.5 Costs, Expenses and Taxes................................................................... 66
15.6 Assignments; Participations................................................................. 66
15.6.1 Assignments...................................................................... 67
15.6.2 Participations................................................................... 68
15.7 Register.................................................................................... 69
15.8 Governing Law............................................................................... 69
15.9 Confidentiality............................................................................. 69
15.10 Severability................................................................................ 70
15.11 Nature of Remedies.......................................................................... 70
15.12 Entire Agreement............................................................................ 70
15.13 Counterparts................................................................................ 70
15.14 Successors and Assigns...................................................................... 70
15.15 Captions.................................................................................... 71
15.16 Customer Identification - USA Patriot Act Notice............................................ 71
15.17 Indemnification By The Company.............................................................. 71
15.18 Nonliability of Lenders..................................................................... 72
15.19 Forum Selection and Consent to Jurisdiction................................................. 73
15.20 Waiver of Jury Trial........................................................................ 73
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ANNEXES
ANNEX A Lenders and Pro Rata Shares
ANNEX B Addresses for Notices
SCHEDULES
SCHEDULE 9.6 Litigation and Contingent Liabilities
SCHEDULE 9.8 Subsidiaries
SCHEDULE 9.16 Insurance
SCHEDULE 9.17 Real Property
SCHEDULE 9.21 Labor Matters
SCHEDULE 11.1 Existing Debt
SCHEDULE 11.2 Existing Liens
SCHEDULE 11.7 Affiliate Transactions
SCHEDULE 11.11 Investments
EXHIBITS
EXHIBIT A Form of Note (Section 3.1)
EXHIBIT B Form of Compliance Certificate (Section 10.1.3)
EXHIBIT C Form of Borrowing Base Certificate (Section 1.1)
EXHIBIT D Form of Assignment Agreement (Section 15.6.1)
EXHIBIT E Form of Notice of Borrowing (Section 2.2.2)
EXHIBIT F Form of Notice of Conversion/Continuation (Section 2.2.3)
CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of July 23, 2004 (this "Agreement") is
entered into among TITAN INTERNATIONAL, INC. (the "Company"), the financial
institutions that are or may from time to time become parties hereto (together
with their respective successors and assigns, the "Lenders"), LASALLE BANK
NATIONAL ASSOCIATION (in its individual capacity, "LaSalle"), as administrative
agent for the Lenders and GENERAL ELECTRIC CAPITAL CORPORATION (in its
individual capacity, "GE Capital") as Co-Agent for the Lenders. (LaSalle and GE
are sometimes collectively referred to as the "Agents" or as the "Initiating
Lenders").
The Lenders have agreed to make available to the Company a revolving
credit facility (which includes letters of credit) upon the terms and conditions
set forth herein.
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
SECTION 1 DEFINITIONS.
1.1 Definitions. When used herein the following terms shall have
the following meanings:
Account Debtor is defined in the Guaranty and Collateral Agreement.
Account or Accounts is defined in the UCC.
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 all or substantially
all of any business or division of a Person, (b) the acquisition of in excess of
50% of the Capital Securities 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 already a Subsidiary).
Administrative Agent means LaSalle in its capacity as administrative
agent for the Lenders hereunder and any successor thereto in such capacity.
Affected Loan - see Section 8.3.
Affiliate of any Person means (a) any other Person which, directly or
indirectly, controls or is controlled by or is under common control with such
Person, (b) any officer or director of such Person and (c) with respect to any
Lender, any entity administered or managed by such Lender or an Affiliate or
investment advisor thereof and which is engaged in making,
purchasing, holding or otherwise investing in commercial loans. A Person shall
be deemed to be "controlled by" any other Person if such Person possesses,
directly or indirectly, power to vote 5% or more of the securities (on a fully
diluted basis) having ordinary voting power for the election of directors or
managers or power to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise. Unless expressly
stated otherwise herein, neither the Administrative Agent nor any Lender shall
be deemed an Affiliate of any Loan Party.
Agents means LaSalle and GE.
Agreement - see the Preamble.
Applicable Margin means, for any day, the rate per annum equal to: (i)
for LIBOR Loans, the LIBOR Margin and (ii) for Base Rate Loans, the Base Rate
Margin.
Asset Disposition means the sale, lease, assignment or other transfer
for value (each, a "Disposition") by any Loan Party to any Person (other than a
Loan Party) of any asset or right of such Loan Party (including, the loss,
destruction or damage of any thereof or any actual or threatened (in writing to
any Loan Party) condemnation, confiscation, requisition, seizure or taking
thereof) other than (a) the Disposition of any asset which is to be replaced,
and is in fact replaced, within 180 days with other like assets, and (b) the
sale or lease of Inventory in the ordinary course of business.
Assignee - see Section 15.6.1.
Assignment Agreement - see Section 15.6.1.
Attorney Costs means, with respect to any Person, all reasonable fees
and charges of any counsel to such Person, the reasonable allocable cost of
internal legal services of such Person, all reasonable disbursements of such
internal counsel and all court costs and similar legal expenses.
Bank Product Agreements means those certain cash management service
agreements entered into from time to time between any Loan Party and a Lender or
its Affiliates in connection with any of the Bank Products.
Bank Product Obligations means all obligations, liabilities, contingent
reimbursement obligations, fees, and expenses owing by the Loan Parties to any
Lender or its Affiliates pursuant to or evidenced by the Bank Product Agreements
and irrespective of whether for the payment of money, whether direct or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, and including all such amounts that a Loan Party is obligated
to reimburse to the Administrative Agent or any Lender as a result of the
Administrative Agent or such Lender purchasing participations or executing
indemnities or reimbursement obligations with respect to the Bank Products
provided to the Loan Parties pursuant to the Bank Product Agreements.
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Bank Products means any service or facility extended to any Loan Party
by any Lender or its Affiliates including: (a) credit cards, (b) credit card
processing services, (c) debit cards, (d) purchase cards, (e) ACH Transactions,
(f) cash management, including controlled disbursement, accounts or services, or
(g) Hedging Agreements.
Base Rate means at any time the greater of (a) the Federal Funds Rate
plus 0.5% and (b) the Prime Rate.
Base Rate Loan means any Loan which bears interest at or by reference
to the Base Rate.
Base Rate Margin means one and one-half percent (1.50%).
Borrowing Base means an amount equal to the total of (a) 75% of the
book value of all Eligible Accounts plus (b) 45% of the book value of all
Eligible Inventory plus (c) 80% of the Orderly Liquidation Value of Equipment.
Upon the request of the Company and the receipt by Lenders of acceptable field
exams, Lenders may, in their sole discretion, increase such advance rates.
Borrowing Base Certificate means a certificate substantially in the
form of Exhibit C.
BSA - see Section 10.4.
Business Day means any day on which LaSalle is open for commercial
banking business in Chicago, Illinois and, in the case of a Business Day which
relates to a LIBOR Loan, on which dealings are carried on in the London
interbank eurodollar market.
Capital Expenditures means all expenditures which, in accordance with
GAAP, would be required to be capitalized and shown on the consolidated balance
sheet of the Company, including expenditures in respect of Capital Leases, but
excluding expenditures made in connection with the replacement, substitution or
restoration of assets to the extent financed (a) from insurance proceeds (or
other similar recoveries) paid on account of the loss of or damage to the assets
being replaced or restored or (b) with awards of compensation arising from the
taking by eminent domain or condemnation of the assets being replaced.
Capital Lease means, with respect to any Person, any lease of (or other
agreement conveying the right to use) any real or personal property by such
Person that, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of such Person.
Capital Securities means, with respect to any Person, all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital, whether now outstanding or
issued or acquired after the Closing Date, including common shares, preferred
shares, membership interests in a limited liability company, limited or general
partnership interests in a partnership, interests in a Trust, interests in other
unincorporated organizations or any other equivalent of such ownership interest.
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Cash Collateralize means to deliver one hundred five percent (105%) of
the amount of letters of credit from time to time outstanding cash collateral to
the Administrative Agent, to be held as cash collateral for outstanding Letters
of Credit, pursuant to documentation satisfactory to the Administrative Agent.
Derivatives of such term have corresponding meanings.
Change of Control means any of the following: (a) any person or group
of persons (within the meaning of the Securities Exchange Act of 1934, as
amended) shall have acquired beneficial ownership (within the meaning of Rule
13d-3 promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended) of 30% or more of the issued and outstanding
shares of Capital Securities of the Company have the right to vote for the
election of directors of the Company under ordinary circumstances; (b) during
any period of twelve (12) consecutive calendar months, individuals who at the
beginning of such period constituted the board of directors of the Company
(together with any new directors whose election by the board of directors of the
Company or whose nomination for election by the stockholders of the Company was
approved by a vote of a least two-thirds of the directors then still in office
who either were directors at the beginning of such period or whose elections or
nomination for election was previously so approved) cease for any reason other
than retirement, death or disability to constitute a majority of the directors
then in office, (c) the Company shall cease to own and control, directly or
indirectly, all of the economic and voting rights associated with all of the
outstanding Capital Securities of any Domestic Subsidiary, or (d) Xxxxxxx X.
Xxxxxx, Xx. for a period in excess of 180 consecutive days, shall cease to be a
director or executive officer of the Company for any reason, including without
limitation death, resignation, retirement or incapacity, and an individual
acceptable to Agents and Lenders shall not be performing the duties and
functions of such director or executive officer of the Company within said 180
day period provided that such acceptance may not be unreasonably withheld.
Closing Date - see Section 12.1.
Code means the Internal Revenue Code of 1986.
Collateral Access Agreement means an agreement in form and substance
reasonably satisfactory to the Administrative Agent pursuant to which a
mortgagee or lessor of real property on which collateral is stored or otherwise
located, or a warehouseman, processor or other bailee of Inventory or other
property owned by any Loan Party, acknowledges the Liens of the Administrative
Agent and waives any Liens held by such Person on such property, and, in the
case of any such agreement with a mortgagee or lessor, permits the
Administrative Agent reasonable access to and use of such real property
following the occurrence and during the continuance of an Event of Default to
assemble, complete and sell any collateral stored or otherwise located thereon.
Co-Agent means GE CAPITAL in its capacity as Co-Agent for the Lenders
hereunder and any successor thereto in such capacity.
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Collateral Documents means, collectively, the Guaranty and Collateral
Agreement, each Mortgage, each Collateral Access Agreement, each Perfection
Certificate, each control agreement and any other agreement or instrument
pursuant to which the Company, any Subsidiary or any other Person grants or
purports to grant collateral to the Administrative Agent for the benefit of the
Lenders or otherwise relates to such collateral.
Commitment means, as to any Lender, such Lender's commitment to make
Loans, and to issue or participate in Letters of Credit, under this Agreement.
The initial amount of each Initial Lender's commitment to make Loans is set
forth on Annex A.
Commitment Letter means the Commitment Letter and attached Term Sheet
executed by the Agents and the Company on July 13, 2004.
Company - see the Preamble.
Compliance Certificate means a Compliance Certificate in substantially
the form of Exhibit B.
Computation Period means each period of four consecutive Fiscal
Quarters ending on the last day of a Fiscal Quarter.
Consolidated Net Income means, with respect to the Company and its
Subsidiaries for any period, as computed on a consolidated basis, the net income
(or loss) of the Company and its Subsidiaries for such period excluding any
gains or losses from Asset Dispositions, any extraordinary gains or losses and
any gains or losses from discontinued operations.
Contingent Liability means, with respect to any Person, each obligation
and liability of such Person and all such obligations and liabilities of such
Person incurred pursuant to any agreement, undertaking or arrangement by which
such Person: (a) guarantees, endorses or otherwise becomes or is 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) the indebtedness,
dividend, obligation or other liability of any other Person in any manner (other
than by endorsement of instruments in the course of collection), including any
indebtedness, dividend or other obligation which may be issued or incurred at
some future time; (b) guarantees the payment of dividends or other distributions
upon the Capital Securities of any other Person; (c) undertakes or agrees
(whether contingently or otherwise): (i) to purchase, repurchase, or otherwise
acquire any indebtedness, obligation or liability of any other Person or any
property or assets constituting security therefor, (ii) to advance or provide
funds for the payment or discharge of any indebtedness, obligation or liability
of any other Person (whether in the form of loans, advances, stock purchases,
capital contributions or otherwise), or to maintain solvency, assets, level of
income, working capital or other financial condition of any other Person, or
(iii) to make payment to any other Person other than for value received; (d)
agrees to lease property or to purchase securities, property or services from
such other Person with the purpose or intent of assuring the owner of such
indebtedness or
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obligation of the ability of such other Person to make payment of the
indebtedness or obligation; (e) to induce the issuance of, or in connection with
the issuance of, any letter of credit for the benefit of such other Person; or
(f) undertakes or agrees otherwise to assure a creditor against loss. The amount
of any Contingent Liability shall (subject to any limitation set forth herein)
be deemed to be the outstanding principal amount (or maximum permitted principal
amount, if larger) of the indebtedness, obligation or other liability guaranteed
or supported thereby.
Controlled Group means all members of a controlled group of
corporations, all members of a controlled group of trades or businesses (whether
or not incorporated) under common control and all members of an affiliated
service group which, together with the Company or any of its Subsidiaries, are
treated as a single employer under Section 414 of the Code or Section 4001 of
ERISA.
Debt of any Person means, without duplication, (a) all indebtedness of
such Person, (b) all borrowed money of such Person, whether or not evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person as lessee under Capital Leases which have been or should be recorded as
liabilities on a balance sheet of such Person in accordance with GAAP, (d) all
obligations of such Person to pay the deferred purchase price of property or
services (excluding trade accounts payable in the ordinary course of business),
(e) all indebtedness secured by a Lien on the property of such Person, whether
or not such indebtedness shall have been assumed by such Person; provided that
if such Person has not assumed or otherwise become liable for such indebtedness,
such indebtedness shall be measured at the fair market value of such property
securing such indebtedness at the time of determination, (f) all obligations,
contingent or otherwise, with respect to the face amount of all letters of
credit (whether or not drawn), bankers' acceptances and similar obligations
issued for the account of such Person (including the Letters of Credit), (g) all
Hedging Obligations of such Person, (h) all Contingent Liabilities of such
Person and (i) all Debt of any partnership of which such Person is a general
partner.
Default means any event that, if it continues uncured, will, with lapse
of time or notice or both, constitute an Event of Default.
Designated Proceeds - see Section 6.2.2(a).
Domestic Subsidiaries means collectively, Titan Tire Corporation, an
Illinois corporation, Titan Wheel Corporation of Illinois, an Illinois
corporation and Titan Wheel Corporation of Virginia, a Virginia corporation and
any Subsidiary formed in compliance with this Agreement after the Closing Date.
Dollar and the sign "$" mean lawful money of the United States of
America.
EBITDA means, for any period, Consolidated Net Income for such period
plus, to the extent deducted in determining such Consolidated Net Income,
Interest Expense, federal, state and local income tax expense, depreciation and
amortization for such period.
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Eligible Account means an Account owing to the Company or any Domestic
Subsidiary which meets each of the following requirements:
(a) it arises from the sale or lease of goods or the
rendering of services which have been fully performed by the Company or
the applicable Domestic Subsidiary;
(b) it (i) is subject to a perfected, first priority Lien
in favor of the Agents and (ii) is not subject to any other assignment,
claim or Lien;
(c) it is a valid, legally enforceable and unconditional
obligation of the Account Debtor with respect thereto, and is not
subject to the fulfillment of any condition whatsoever or any
counterclaim, set off, or adjustment by the Account Debtor outside of
the ordinary course of business with respect thereto;
(d) there is no bankruptcy, insolvency or liquidation
proceeding pending by or against the Account Debtor with respect
thereto;
(e) the Account Debtor (except for Titan Europe Plc and
its wholly-owned subsidiaries)with respect thereto is a resident or
citizen of, and is located within, the United States, unless the sale
of goods or services giving rise to such Account is on letter of
credit, banker's acceptance or other credit terms reasonably
satisfactory to the Administrative Agent;
(f) it arises in the ordinary course of business of the
Company or the applicable Domestic Subsidiary;
(g) if the Account Debtor is the United States or any
department, agency or instrumentality thereof, the Company or the
applicable Domestic Subsidiary has assigned its right to payment of
such Account to the Administrative Agent pursuant to the Assignment of
Claims Act of 1940 (but which Assignment shall not be filed by the
Administrative Agent except upon the occurrence of an Event of
Default);
(h) if the Account is evidenced by chattel paper or an
instrument, the originals of such chattel paper or instrument shall
have been endorsed and/or assigned and delivered to the Administrative
Agent or, in the future case of electronic chattel paper, shall be in
the control of the Administrative Agent, in each case in a manner
satisfactory to the Administrative Agent;
(i) the Account Debtor with respect thereto is not the
Company or an Affiliate (except for Titan Europe Plc. and its
wholly-owned subsidiaries) of the Company; and
(j) all of the applicable representations and warranties
with respect to such Account that are contained in any of the Loan
Documents remain true and correct.
7
An Account which is at any time an Eligible Account, but which subsequently
fails to meet any of the foregoing requirements, shall forthwith cease to be an
Eligible Account.
Eligible Inventory means Inventory of the Company or any Domestic
Subsidiary which meets each of the following requirements:
(a) it (i) is subject to a perfected, first priority Lien
in favor of the Agents and (ii) is not subject to any other assignment,
claim or Lien;
(b) it is salable and not obsolete or discontinued;
(c) it is not Inventory produced in violation of the Fair
Labor Standards Act and subject to the "hot goods" provisions contained
in Title 29 U.S.C. Section 215;
(d) it is not subject to any agreement or license which
would restrict the Agents' ability to sell or otherwise dispose of such
Inventory;
(e) it is located in the United States or in any
territory or possession of the United States that has adopted Article 9
of the Uniform Commercial Code;
(f) it does not materially breach any of the
representations, warranties or covenants pertaining to Inventory set
forth in the Loan Documents; and
(g) it has a value not in excess of $15,000,000 in the
aggregate if it is stored outside of the Mortgaged Real Property and
that facility currently occupied by Titan Wheel Corporation of Virginia
as it principal place of business.
Inventory which is at any time Eligible Inventory but which subsequently fails
to meet any of the foregoing requirements shall forthwith cease to be Eligible
Inventory.
Inventory housed other than in the Mortgaged Real Property or that facility
currently occupied by Titan Wheel Corporation of Virginia as it principal place
of business, to the extent it has a value less than $15,000,000 in the aggregate
and is subject to an account payable of the Company, shall be deducted in the
amount of such account payable from the Borrowing Base.
Environmental Claims means all claims, however asserted, by any
governmental, regulatory or judicial authority or other Person alleging
potential liability or responsibility for violation of any Environmental Law, or
for release or injury to the environment.
Environmental Laws means all present or future federal, state or local
laws, statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative or judicial orders, consent agreements,
directed duties, requests, licenses, authorizations and permits of, and
agreements with, any governmental authority, in each case relating to any matter
arising out of or relating to public health and safety, or pollution or
protection of the environment or workplace, including any of the foregoing
relating to the presence, use, production,
8
generation, handling, transport, treatment, storage, disposal, distribution,
discharge, emission, release, threatened release, control or cleanup of any
Hazardous Substance.
Equipment shall mean all machinery and equipment now owned or hereafter
acquired by an Obligor, and located at the principal place of business of an
Obligor, including all such Obligor's processing equipment, conveyors, machine
tools and all engineering, processing and manufacturing equipment, office
machinery, furniture, tools, attachments, accessories, molds, dies, stamps, and
other machinery and equipment, but not including any motor vehicles or other
titled assets.
ERISA means the Employee Retirement Income Security Act of 1974.
Event of Default means any of the events described in Section 13.1.
Excluded Taxes means taxes based upon, or measured by, the Lender's or
Administrative Agent's (or a branch of the Lender's or Administrative Agent's)
overall net income, overall net receipts, or overall net profits (including
franchise taxes imposed in lieu of such taxes), but only to the extent such
taxes are imposed by a taxing authority (a) in a jurisdiction in which such
Lender or Administrative Agent is organized, (b) in a jurisdiction which the
Lender's or Administrative Agent's principal office is located, or (c) in a
jurisdiction in which such Lender's or Administrative Agent's lending office (or
branch) in respect of which payments under this Agreement are made is located.
Existing Term Loan shall mean that certain term loan described in the
Credit Agreement dated December 21, 2001 between certain Loan Parties, the
lenders signatory thereto, and GE Capital, as agent and lender.
Federal Funds Rate means, for any day, a fluctuating interest rate
equal for each day during such period to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by the Administrative Agent. The Administrative
Agent's determination of such rate shall be binding and conclusive absent
manifest error.
Fiscal Quarter means a fiscal quarter of a Fiscal Year.
Fiscal Year means the fiscal year of the Company and its Subsidiaries,
which period shall be the 12-month period ending on December 31st of each year.
References to a Fiscal Year with a number corresponding to any calendar year
(e.g., "Fiscal Year 2004") refer to the Fiscal Year ending on December 31st of
such calendar year.
9
Fixed Charge Coverage Ratio means commencing January 1, 2004, for any
Computation Period, the ratio of (a) the total for such period of EBITDA minus
the sum of income taxes paid in cash by the Loan Parties and all unfinanced
Capital Expenditures to (b) the sum for such period of (i) cash Interest Expense
plus (ii) required payments of principal of Funded Debt (excluding the Revolving
Loans).
Foreign Affiliate Loan means the loan from one of the Company's
Affiliates not organized under a United States jurisdiction in approximate the
principal amount of $50,000,000.
Foreign Subsidiary means any Subsidiaries organized under the laws of a
jurisdiction outside of the United States of America.
FRB means the Board of Governors of the Federal Reserve System or any
successor thereto.
Funded Debt means, as to any Person, all Debt of such Person that
matures more than one year from the date of its creation (or is renewable or
extendible, at the option of such Person, to a date more than one year from such
date).
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) and the Securities and Exchange Commission, which are applicable to
the circumstances as of the date of determination.
Group - see Section 2.2.1.
Guaranty and Collateral Agreement means the Guaranty and Collateral
Agreement dated as of the date hereof executed and delivered by the Loan
Parties, together with any joinders thereto and any other guaranty and
collateral agreement executed by a Loan Party, in each case in form and
substance satisfactory to the Administrative Agent.
Hazardous Substances means (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is or could become friable,
urea formaldehyde foam insulation, dielectric fluid containing levels of
polychlorinated biphenyls, radon gas and mold; (b) any chemicals, materials,
pollutant or substances defined as or included in the definition of "hazardous
substances", "hazardous waste", "hazardous materials", "extremely hazardous
substances", "restricted hazardous waste", "toxic substances", "toxic
pollutants", "contaminants", "pollutants" or words of similar import, under any
applicable Environmental Law; and (c) any other chemical, material or substance,
the exposure to, or release of which is prohibited, limited or regulated by any
governmental authority or for which any duty or standard of care is imposed
pursuant to, any Environmental Law.
10
Hedging Agreement means any interest rate, currency or commodity swap
agreement, cap agreement or collar agreement, and any other agreement or
arrangement designed to protect a Person against fluctuations in interest rates,
currency exchange rates or commodity prices.
Hedging Obligation means, with respect to any Person, any liability of
such Person under any Hedging Agreement. The amount of any Person's obligation
in respect of any Hedging Obligation shall be deemed to be the incremental
obligation that would be reflected in the financial statements of such Person in
accordance with GAAP.
Indemnified Liabilities - see Section 15.16.
Interest Expense means for any period the consolidated interest expense
of the Company and its Subsidiaries for such period (including all imputed
interest on Capital Leases).
Interest Period means, as to any LIBOR Loan, the period commencing on
the date such Loan is borrowed or continued as, or converted into, a LIBOR Loan
and ending on the date one, two or three months thereafter as selected by the
Company pursuant to Section 2.2.2 or 2.2.3, as the case may be; provided that:
(a) if any Interest Period would otherwise end
on a day that is not a Business Day, such Interest Period
shall be extended to the following Business Day unless 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;
(b) any Interest Period that begins 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
(c) the Company may not select any Interest
Period for a Revolving Loan which would extend beyond the
scheduled Termination Date
Inventory is defined in the Guaranty and Collateral Agreement.
Investment means, with respect to any Person, any investment in another
Person, whether by acquisition of any debt or Capital Security, by making any
loan or advance, by becoming obligated with respect to a Contingent Liability in
respect of obligations of such other Person (other than travel and similar
advances to employees in the ordinary course of business) or by making an
Acquisition.
IRB means the industrial revenue bonds of the Company currently in
place.
11
Issuing Lender means LaSalle, in its capacity as the issuer of Letters
of Credit hereunder, or any Affiliate of LaSalle that may from time to time
issue Letters of Credit, and their successors and assigns in such capacity.
LaSalle - see the Preamble.
L/C Application means, with respect to any request for the issuance of
a Letter of Credit, a letter of credit application in the form being used by the
Issuing Lender at the time of such request for the type of letter of credit
requested.
L/C Fee Rate shall mean 3.00%
Lender - see the Preamble. References to the "Lenders" shall include
the Issuing Lender; for purposes of clarification only, to the extent that
LaSalle (or any successor Issuing Lender) may have any rights or obligations in
addition to those of the other Lenders due to its status as Issuing Lender, its
status as such will be specifically referenced. In addition to the foregoing,
for the purpose of identifying the Persons entitled to share in the Collateral
and the proceeds thereof under, and in accordance with the provisions of, this
Agreement and the Collateral Documents, the term "Lender" shall include
Affiliates of a Lender providing a Bank Product.
Lender Party - see Section 15.16.
Letter of Credit - see Section 2.1.3.
LIBOR Loan means any Loan which bears interest at a rate determined by
reference to the LIBOR Rate.
LIBOR Margin means three percent (3.00%).
LIBOR Office means with respect to any Lender the office or offices of
such Lender which shall be making or maintaining the LIBOR Loans of such Lender
hereunder. A LIBOR Office of any Lender may be, at the option of such Lender,
either a domestic or foreign office.
LIBOR Rate means a rate of interest equal to (a) the per annum rate of
interest at which United States dollar deposits in an amount comparable to the
amount of the relevant LIBOR Loan and for a period equal to the relevant
Interest Period are offered in the London Interbank Eurodollar market at 11:00
A.M. (London time) two (2) Business Days prior to the commencement of such
Interest Period (or three (3) Business Days prior to the commencement of such
Interest Period if banks in London, England were not open and dealing in
offshore United States dollars on such second preceding Business Day), as
displayed in the Bloomberg Financial Markets system (or other authoritative
source selected by the Administrative Agent in its sole discretion) or, if the
Bloomberg Financial Markets system or another authoritative source is not
available, as the LIBOR Rate is otherwise determined by the Administrative Agent
in its sole and absolute discretion, divided by (b) a number determined by
subtracting from 1.00 the then stated maximum reserve percentage for determining
reserves to be maintained by member
12
banks of the Federal Reserve System for Eurocurrency funding or liabilities as
defined in Regulation D (or any successor category of liabilities under
Regulation D), such rate to remain fixed for such Interest Period. The
Administrative Agent's determination of the LIBOR Rate shall be conclusive,
absent manifest error.
Lien means, with respect to any Person, any interest granted by such
Person in any real or personal property, asset or other right owned or being
purchased or acquired by such Person (including an interest in respect of a
Capital Lease) which secures payment or performance of any obligation and shall
include any mortgage, lien, encumbrance, title retention lien, charge or other
security interest of any kind, whether arising by contract, as a matter of law,
by judicial process or otherwise.
Loan Documents means this Agreement, the Notes, the Letters of Credit,
the Master Letter of Credit Agreement, the L/C Applications, the Commitment
Letter, the Collateral Documents, the Subordination Agreements and all
documents, instruments and agreements delivered in connection with the
foregoing.
Loan Party means the Company and each Subsidiary other than the Foreign
Subsidiaries and other than Dyneer Corporation, Dico, Inc. and Titan Tire
Corporation of Natchez.
Loan or Loans means, as the context may require, Revolving Loans.
Mandatory Prepayment Event - see Section 6.2.2(a).
Margin Stock means any "margin stock" as defined in Regulation U.
Master Letter of Credit Agreement means, at any time, with respect to
the issuance of Letters of Credit, a master letter of credit agreement or
reimbursement agreement in the form, if any, being used by the Issuing Lender at
such time.
Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the financial condition, operations, assets,
business, properties or prospects of the Obligors taken as a whole, (b) a
material impairment of the ability of any Obligor to perform any of the
Obligations under any Loan Document or (c) a material adverse effect upon any of
the collateral under the Collateral Documents or upon the legality, validity,
binding effect or enforceability against any Loan Party of any Loan Document.
Without limiting the foregoing, any event or occurrence adverse to one or more
Obligors which results or could reasonably be expected to result in costs and/or
liabilities and/or loss of revenues, individually or in the aggregate, to any
Obligor in any 30-day period in excess of 50% of the sum of (a) the net amount
available to be drawn on the date of determination under the Revolving Credit
Commitment, plus (b) the available cash and unrestricted cash equivalents of
Obligors on such date, shall be deemed to have had a Material Adverse Effect.
Mortgage means a mortgage, deed of trust, or similar instrument
granting the Administrative Agent a Lien on real property of any Loan Party.
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Mortgaged Real Property shall mean the real property of the Company
identified in the Mortgages, and located in Quincy, Illinois and Des Moines,
Iowa.
Multiemployer Pension Plan means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Company or any other member of the
Controlled Group may have any liability.
Net Cash Proceeds means:
(a) with respect to any Asset Disposition, the aggregate cash
proceeds (including cash proceeds received pursuant to
policies of insurance or by way of deferred payment of
principal pursuant to a note, installment receivable or
otherwise, but only as and when received) received by any Loan
Party pursuant to such Asset Disposition net of (i) the direct
costs relating to such sale, transfer or other disposition
(including sales commissions and legal, accounting and
investment banking fees), (ii) taxes paid or reasonably
estimated by the Company to be payable as a result thereof
(after taking into account any available tax credits or
deductions and any tax sharing arrangements) and (iii) amounts
required to be applied to the repayment of any Debt secured by
a Lien on the asset subject to such Asset Disposition (other
than the Loans);
(b) with respect to any issuance of Capital Securities, the
aggregate cash proceeds received by any Loan Party pursuant to
such issuance, net of the direct costs relating to such
issuance (including sales and underwriters' commissions); and
(c) with respect to any issuance of Debt, the aggregate cash
proceeds received by any Loan Party pursuant to such issuance,
net of the direct costs of such issuance (including up-front,
underwriters' and placement fees).
Non-U.S. Participant - see Section 7.6(d).
Non-Use Fee Rate shall mean three-eights of one percent (.375%).
Note means a promissory note substantially in the form of Exhibit A.
Notice of Borrowing - see Section 2.2.2.
Notice of Conversion/Continuation - see Section 2.2.3.
Obligors shall mean the Company and its Domestic Subsidiaries.
Obligations means all obligations (monetary (including post-petition
interest, allowed or not) or otherwise) of any Loan Party under this Agreement
and any other Loan Document including Attorney Costs and any reimbursement
obligations of each Loan Party in respect of Letters of Credit and surety bonds,
all Hedging Obligations permitted hereunder which are owed
14
to any Lender, and all Bank Products Obligations, all in each case howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due.
OFAC - see Section 10.4.
Orderly Liquidation Value shall mean (a) the in place orderly
liquidation value, as determined by the most recent appraisal prepared for
Lenders, or (b) in the case of assets not subject to such appraisals, the book
value of such assets.
Operating Lease means any lease of (or other agreement conveying the
right to use) any real or personal property by any Loan Party, as lessee, other
than any Capital Lease.
PBGC means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
Participant - see Section 15.6.2.
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 or the minimum funding
standards of ERISA (other than a Multiemployer Pension Plan), and as to which
the Company or any member of the 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.
Permitted Lien means a Lien expressly permitted hereunder pursuant to
Section 11.2.
Person means any natural person, corporation, partnership, trust,
limited liability company, association, governmental authority or unit, or any
other entity, whether acting in an individual, fiduciary or other capacity.
Prime Rate means, for any day, the rate of interest in effect for such
day as publicly announced from time to time by the Administrative Agent as its
prime commercial rate (whether or not such rate is actually charged by the
Administrative Agent), which is not intended to be the Administrative Agent's
lowest or most favorable rate of interest at any one time. Any change in the
Prime Rate announced by the Administrative Agent shall take effect at the
opening of business on the day specified in the public announcement of such
change; provided that the Administrative Agent shall not be obligated to give
notice of any change in the Prime Rate.
Pro Rata Share means:
(a) with respect to a Lender's obligation to make Revolving Loans,
participate in Letters of Credit, reimburse the Issuing
Lender, and receive payments of principal, interest, fees,
costs, and expenses with respect thereto, (x) prior to the
Revolving Commitment being terminated or reduced to zero, the
percentage
15
obtained by dividing (i) such Lender's Commitment, by (ii) the
aggregate Revolving Commitment of all Lenders and (y) from and
after the time the Revolving Commitment has been terminated or
reduced to zero, the percentage obtained by dividing (i) the
aggregate unpaid principal amount of such Lender's Revolving
Outstandings by (ii) the aggregate unpaid principal amount of
all Revolving Outstandings;
(b) with respect to all other matters as to a particular Lender,
the percentage obtained by dividing (i) such Lender's
Commitment, by (ii) the aggregate amount of Revolving
Commitment of all Lenders; provided that in the event the
Commitments have been terminated or reduced to zero, Pro Rata
Share shall be the percentage obtained by dividing (A) the
principal amount of such Lender's Revolving Outstandings by
(B) the principal amount of all outstanding Revolving
Outstandings.
Regulation D means Regulation D of the FRB.
Regulation U means Regulation U of the FRB.
Reportable Event means a reportable event as defined in Section 4043 of
ERISA and the regulations issued thereunder as to which the PBGC has not waived
the notification requirement of Section 4043(a), or the failure of a Pension
Plan to meet the minimum funding standards of Section 412 of the Code (without
regard to whether the Pension Plan is a plan described in Section 4021(a)(2) of
ERISA) or under Section 302 of ERISA.
Required Lenders means, at any time, Lenders whose Pro Rata Shares
exceed 66-2/3%.
Revolving Commitment means $100,000,000, as reduced from time to time
pursuant to Section 6.1.
Revolving Loan - see Section 2.1.1.
Revolving Loan Availability means the lesser of (i) the Revolving
Commitment and (ii) the Borrowing Base.
Revolving Outstandings means, at any time, the sum of (a) the aggregate
principal amount of all outstanding Revolving Loans, plus (b) the Stated Amount
of all Letters of Credit.
SEC means the Securities and Exchange Commission or any other
governmental authority succeeding to any of the principal functions thereof.
Senior Convertible Notes means the $100,000,000 Senior Convertible
Notes due 2009, to be issued by the Company on or about the Closing Date.
16
Senior Debt means all Debt of the Company and its Subsidiaries other
than Subordinated Debt.
Senior Officer means, with respect to any Loan Party, any of the chief
executive officer, the chief financial officer, the chief operating officer,
secretary or the treasurer of such Loan Party.
Stated Amount means, with respect to any Letter of Credit at any date
of determination, (a) the maximum aggregate amount available for drawing
thereunder under any and all circumstances plus (b) the aggregate amount of all
unreimbursed payments and disbursements under such Letter of Credit.
Subordinated Debt means the Subordinated Notes, the Senior Convertible
Notes, the Foreign Affiliate Loan and any other unsecured Debt of the Company
which has subordination terms, covenants, pricing and other terms which have
been approved in writing by the Required Lenders.
Subordinated Debt Documents means all documents and instruments
relating to the Subordinated Debt and all amendments and modifications thereof.
Subordinated Notes means the existing 8.75% Senior Subordinated Notes
of the Company due April 1, 2007.
Subordination Agreements means all subordination agreements executed by
a holder of Subordinated Debt in favor of the Administrative Agent and the
Lenders from time to time after the Closing Date.
Subsidiary means, with respect to any Person, a corporation,
partnership, limited liability company or other entity of which such Person
owns, directly or indirectly, such number of outstanding Capital Securities as
have more than 50% of the ordinary voting power for the election of directors or
other managers of such corporation, partnership, limited liability company or
other entity. Unless the context otherwise requires, each reference to
Subsidiaries herein shall be a reference to Subsidiaries of the Company.
Taxes means any and all present and future taxes, duties, levies,
imposts, deductions, assessments, charges or withholdings, and any and all
liabilities (including interest and penalties and other additions to taxes) with
respect to the foregoing, but excluding Excluded Taxes.
Termination Date means the earlier to occur of (a) July 23, 2007;
provided, however, that to the extent any of the Subordinated Notes remain
outstanding as of February 1, 2007, then the Termination Date shall mean March
1, 2007, or (b) such other date on which the Commitments terminate pursuant to
Section 6 or 13.
17
Termination Event means, with respect to a Pension Plan that is subject
to Title IV of ERISA, (a) a [material] Reportable Event, (b) the withdrawal of
Company or any other member of the Controlled Group from such Pension Plan
during a plan year in which Company or any other member of the Controlled Group
was a "substantial employer" as defined in Section 4001(a)(2) of ERISA which has
a Material Adverse Effect, or was deemed such under Section 4068(f) of ERISA,
(c) the termination of such Pension Plan, the filing of a notice of intent to
terminate the Pension Plan or the treatment of an amendment of such Pension Plan
as a termination under Section 4041 of ERISA which has a Material Adverse
Effect, (d) the institution by the PBGC of proceedings to terminate such Pension
Plan which has a Material Adverse Effect or (e) any event or condition that
might constitute grounds under Section 4042 of ERISA for the termination of, or
appointment of a trustee to administer, such Pension Plan which has a Material
Adverse Effect.
Total Plan Liability means, at any time, the present value of all
vested and unvested accrued benefits under all Pension Plans, determined as of
the then most recent valuation date for each Pension Plan, using PBGC actuarial
assumptions for single employer plan terminations.
Type - see Section 2.2.1.
UCC is defined in the Guaranty and Collateral Agreement.
Unfunded Liability means the amount (if any) by which the present value
of all vested and unvested accrued benefits under all Pension Plans exceeds the
fair market value of all assets allocable to those benefits, all determined as
of the then most recent valuation date for each Pension Plan, using PBGC
actuarial assumptions for single employer plan terminations.
Withholding Certificate - see Section 7.6(d).
Wholly-Owned Subsidiary means, as to any Person, a Subsidiary all of
the Capital Securities of which (except directors' qualifying Capital
Securities) are at the time directly or indirectly owned by such Person and/or
another Wholly-Owned Subsidiary of such Person.
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) Section, Annex, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) The term "including" is not limiting and means "including
without limitation."
(d) 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."
18
(e) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement and the other Loan Documents) and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, supplements and other modifications thereto, but only to the
extent such amendments, restatements, supplements and other modifications are
not prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation shall be construed as including all statutory and
regulatory provisions amending, replacing, supplementing or interpreting such
statute or regulation.
(f) This Agreement and the 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 each
shall be performed in accordance with its terms.
(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 Company, the Lenders and the other parties thereto and are the
products of all parties. Accordingly, they shall not be construed against the
Administrative Agent or the Lenders merely because of the Administrative Agent's
or Lenders' involvement in their preparation.
SECTION 2 COMMITMENTS OF THE LENDERS; BORROWING, CONVERSION AND LETTER
OF CREDIT PROCEDURES.
2.1 Commitments. On and subject to the terms and conditions of
this Agreement, each of the Lenders, severally and for itself alone, agrees to
make loans to, and to issue or participate in letters of credit for the account
of, the Company as follows:
2.1.1 Revolving Loan Commitment. Each Lender with a Revolving Loan
Commitment agrees to make loans on a revolving basis ("Revolving Loans") from
time to time until the Termination Date in such Lender's Pro Rata Share of such
aggregate amounts as the Company may request from all Lenders; provided that the
Revolving Outstandings will not at any time exceed Revolving Loan Availability.
Within the limits and provisions of this Agreement Company may make such
borrowings, repay such advances, and make additional borrowing under the Loan.
2.1.2 Intentionally omitted.
2.1.3 L/C Commitment. Subject to Section 2.3.1, the Issuing Lender
agrees to issue letters of credit, in each case containing such terms and
conditions as are permitted by this Agreement and are reasonably satisfactory to
the Issuing Lender (each, a "Letter of Credit"), at the request of and for the
account of the Company from time to time before the scheduled Termination Date
and, as more fully set forth in Section 2.3.2, each Lender agrees to purchase a
participation in each such Letter of Credit; provided that (a) the aggregate
Stated Amount of all Letters of Credit shall not at any time exceed $20,000,000
and (b) the Revolving Outstandings shall not at any time exceed Revolving Loan
Availability.
2.2 Loan Procedures.
19
2.2.1 Various Types of Loans. Each Revolving Loan shall be divided
into tranches which are either a Base Rate Loan or a LIBOR Loan (each a "type"
of Loan), as the Company shall specify in the related notice of borrowing or
conversion pursuant to Section 2.2.2 or 2.2.3. LIBOR Loans having the same
Interest Period which expire on the same day are sometimes called a "Group" or
collectively "Groups". Base Rate Loans and LIBOR Loans may be outstanding at the
same time, provided that not more than five (5) different Groups of LIBOR Loans
shall be outstanding at any one time. All borrowings, conversions and repayments
of Revolving Loans shall be effected so that each Lender will have a ratable
share (according to its Pro Rata Share) of all types and Groups of Loans.
Notwithstanding the foregoing or any other provision of this Agreement, the
Company may not select any Interest Period for a LIBOR Loan which is longer than
the date or dates selected by the Administrative Agent from time to time for any
syndication of the Loans.
2.2.2 Borrowing Procedures. The Company shall give written notice
(each such written notice, a "Notice of Borrowing") substantially in the form of
Exhibit E or telephonic notice (followed immediately by a Notice of Borrowing)
to the Administrative Agent of each proposed borrowing not later than (a) in the
case of a Base Rate borrowing, 12:00 P.M., Chicago time, on the proposed date of
such borrowing, and (b) in the case of a LIBOR borrowing, 12:00 P.M., Chicago
time, at least three Business Days prior to the proposed date of such borrowing.
Each such notice shall be effective upon receipt by the Administrative Agent,
shall be irrevocable, and shall specify the date, amount and type of borrowing
and, in the case of a LIBOR borrowing, the initial Interest Period therefor.
Promptly upon receipt of such notice, the Administrative Agent shall advise each
Lender thereof. Not later than 1:00 P.M., Chicago time, on the date of a
proposed borrowing, each Lender shall provide the Administrative Agent at the
office specified by the Administrative Agent with immediately available funds
covering such Lender's Pro Rata Share of such borrowing and, so long as the
Administrative Agent has not received written notice that the conditions
precedent set forth in Section 11 with respect to such borrowing have not been
satisfied, the Administrative Agent shall pay over the funds received by the
Administrative Agent to the Company on the requested borrowing date. Each
borrowing shall be on a Business Day. Each Base Rate borrowing shall be in an
aggregate amount of at least Five Hundred Thousand and No/100 Dollars
($500,000.00) and an integral multiple of One Hundred Thousand and No/100
Dollars ($100,000.00), and each LIBOR borrowing shall be in an aggregate amount
of at least One Million and No/100 Dollars ($1,000,000.00) and an integral
multiple of at least One Hundred Thousand and No/100 Dollars ($100,000.00).
2.2.3 Conversion and Continuation Procedures. (a) Subject to Section
2.2.1, the Company may, upon irrevocable written notice to the Administrative
Agent in accordance with clause (b) below:
(A) elect, as of any Business Day, to convert any Loans
(or any part thereof in an aggregate amount not less than Five Hundred Thousand
and No/100 Dollars ($500,000.00) or a higher integral multiple of One Hundred
Thousand and No/100 Dollars ($100,000.00) into Loans of the other type; or
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(B) elect, as of the last day of the applicable Interest
Period, to continue any LIBOR Loans having Interest Periods expiring on such day
(or any part thereof in an aggregate amount not less than One Million and No/100
Dollars ($1,000,000.00) or a higher integral multiple of One Hundred Thousand
and No/100 Dollars ($100,000.00) for a new Interest Period;
provided that after giving effect to any prepayment, conversion or continuation,
the aggregate principal amount of each Group of LIBOR Loans shall be at least
One Million and No/100 Dollars ($1,000,000.00) and an integral multiple of One
Hundred Thousand and No/100 Dollars ($100,000.00).
(b) The Company shall give written notice (each such written
notice, a "Notice of Conversion/Continuation") substantially in the form of
Exhibit F or telephonic notice (followed immediately by a Notice of
Conversion/Continuation) to the Administrative Agent of each proposed conversion
or continuation not later than (i) in the case of conversion into Base Rate
Loans, 12:00 P.M., Chicago time, on the proposed date of such conversion and
(ii) in the case of conversion into or continuation of LIBOR Loans, 12:00 P.M.,
Chicago time, at least three Business Days prior to the proposed date of such
conversion or continuation, specifying in each case:
(A) the proposed date of conversion or continuation;
(B) the aggregate amount of Loans to be converted or
continued;
(C) the type of Loans resulting from the proposed
conversion or continuation; and
(D) in the case of conversion into, or continuation of,
LIBOR Loans, the duration of the requested Interest Period therefor.
(c) If upon the expiration of any Interest Period applicable to
LIBOR Loans, the Company has failed to select timely a new Interest Period to be
applicable to such LIBOR Loans, the Company shall be deemed to have elected to
convert such LIBOR Loans into Base Rate Loans effective on the last day of such
Interest Period.
(d) The Administrative Agent will promptly notify each Lender of
its receipt of a notice of conversion or continuation pursuant to this Section
2.2.3 or, if no timely notice is provided by the Company, of the details of any
automatic conversion.
(e) Any conversion of a LIBOR Loan on a day other than the last
day of an Interest Period therefor shall be subject to Section 8.4.
2.3 Letter of Credit Procedures.
2.3.1 L/C Applications. The Company shall execute and deliver to the
Issuing Lender the Master Letter of Credit Agreement from time to time in
effect. The Company shall give
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notice to the Administrative Agent and the Issuing Lender of the proposed
issuance of each Letter of Credit on a Business Day which is at least three
Business Days (or such lesser number of days as the Administrative Agent and the
Issuing Lender shall agree in any particular instance in their sole discretion)
prior to the proposed date of issuance of such Letter of Credit. Each such
notice shall be accompanied by an L/C Application, duly executed by the Company
and in all respects satisfactory to the Administrative Agent and the Issuing
Lender, together with such other documentation as the Administrative Agent or
the Issuing Lender may request in support thereof, it being understood that each
L/C Application shall specify, among other things, the date on which the
proposed Letter of Credit is to be issued, the expiration date of such Letter of
Credit (which shall not be later than the scheduled Termination Date (unless
such Letter of Credit is Cash Collateralized)) and whether such Letter of Credit
is to be transferable in whole or in part. Any Letter of Credit outstanding
after the scheduled Termination Date which is Cash Collateralized for the
benefit of the Issuing Lender shall be the sole responsibility of the Issuing
Lender. So long as the Issuing Lender has not received written notice that the
conditions precedent set forth in Section 12 with respect to the issuance of
such Letter of Credit have not been satisfied, the Issuing Lender shall issue
such Letter of Credit on the requested issuance date. The Issuing Lender shall
promptly advise the Administrative Agent of the issuance of each Letter of
Credit and of any amendment thereto, extension thereof or event or circumstance
changing the amount available for drawing thereunder. In the event of any
inconsistency between the terms of the Master Letter of Credit Agreement, any
L/C Application and the terms of this Agreement, the terms of this Agreement
shall control.
2.3.2 Participations in Letters of Credit. Concurrently with the
issuance of each Letter of Credit, the Issuing Lender shall be deemed to have
sold and transferred to each Lender with a Revolving Loan Commitment, and each
such Lender shall be deemed irrevocably and unconditionally to have purchased
and received from the Issuing Lender, without recourse or warranty, an undivided
interest and participation, to the extent of such Lender's Pro Rata Share, in
such Letter of Credit and the Company's reimbursement obligations with respect
thereto. If the Company does not pay any reimbursement obligation when due, the
Company shall be deemed to have immediately requested that the Lenders make a
Revolving Loan which is a Base Rate Loan in a principal amount equal to such
reimbursement obligations. The Administrative Agent shall promptly notify such
Lenders of such deemed request and, without the necessity of compliance with the
requirements of Section 2.2.2, 12.2 or otherwise such Lender shall make
available to the Administrative Agent its Pro Rata Share of such Loan. The
proceeds of such Loan shall be paid over by the Administrative Agent to the
Issuing Lender for the account of the Company in satisfaction of such
reimbursement obligations. For the purposes of this Agreement, the
unparticipated portion of each Letter of Credit shall be deemed to be the
Issuing Lender's "participation" therein. The Issuing Lender hereby agrees, upon
request of the Administrative Agent or any Lender, to deliver to the
Administrative Agent or such Lender a list of all outstanding Letters of Credit
issued by the Issuing Lender, together with such information related thereto as
the Administrative Agent or such Lender may reasonably request.
2.3.3 Reimbursement Obligations. (a) The Company hereby
unconditionally and irrevocably agrees to reimburse the Issuing Lender for each
payment or disbursement made by
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the Issuing Lender under any Letter of Credit honoring any demand for payment
made by the beneficiary thereunder, in each case on the date that such payment
or disbursement is made. Any amount not reimbursed on the date of such payment
or disbursement shall bear interest from the date of such payment or
disbursement to the date that the Issuing Lender is reimbursed by the Company
therefor, payable on demand, at a rate per annum equal to the Base Rate from
time to time in effect plus the Base Rate Margin from time to time in effect
plus, beginning on the third Business Day after receipt of notice from the
Issuing Lender of such payment or disbursement, 2%. The Issuing Lender shall
notify the Company and the Administrative Agent whenever any demand for payment
is made under any Letter of Credit by the beneficiary thereunder; provided that
the failure of the Issuing Lender to so notify the Company or the Administrative
Agent shall not affect the rights of the Issuing Lender or the Lenders in any
manner whatsoever.
(b) The Company's reimbursement obligations hereunder
shall be irrevocable and unconditional under all circumstances, including (a)
any lack of validity or enforceability of any Letter of Credit, this Agreement
or any other Loan Document, (b) the existence of any claim, set-off, defense or
other right which any Loan Party may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit (or any
Person for whom any such transferee may be acting), the Administrative Agent,
the Issuing Lender, any Lender or any other Person, whether in connection with
any Letter of Credit, this Agreement, any other Loan Document, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between any Loan Party and the beneficiary named in any Letter of
Credit), (c) the validity, sufficiency or genuineness of any document which the
Issuing Lender has determined complies on its face with the terms of the
applicable Letter of Credit, even if such document should later prove to have
been forged, fraudulent, invalid or insufficient in any respect or any statement
therein shall have been untrue or inaccurate in any respect, or (d) the
surrender or impairment of any security for the performance or observance of any
of the terms hereof. Without limiting the foregoing, no action or omission
whatsoever by the Administrative Agent or any Lender (excluding any Lender in
its capacity as the Issuing Lender) under or in connection with any Letter of
Credit or any related matters shall result in any liability of the
Administrative Agent or any Lender to the Company, or relieve the Company of any
of its obligations hereunder to any such Person.
2.3.4 Funding by Lenders to Issuing Lender. If the Issuing Lender
makes any payment or disbursement under any Letter of Credit and (a) the Company
has not reimbursed the Issuing Lender in full for such payment or disbursement
by 12:00 P.M., Chicago time, on the date of such payment or disbursement, (b) a
Revolving Loan may not be made in accordance with Section 2.3.2 or (c) any
reimbursement received by the Issuing Lender from the Company is or must be
returned or rescinded upon or during any bankruptcy or reorganization of the
Company or otherwise, each other Lender with a Revolving Loan Commitment shall
be obligated to pay to the Administrative Agent for the account of the Issuing
Lender, in full or partial payment of the purchase price of its participation in
such Letter of Credit, its Pro Rata Share of such payment or disbursement (but
no such payment shall diminish the obligations of the Company under Section
2.3.3), and, upon notice from the Issuing Lender, the Administrative Agent shall
promptly notify each other Lender thereof. Each other Lender irrevocably and
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unconditionally agrees to so pay to the Administrative Agent in immediately
available funds for the Issuing Lender's account the amount of such other
Lender's Pro Rata Share of such payment or disbursement. If and to the extent
any Lender shall not have made such amount available to the Administrative Agent
by 1:00 P.M., Chicago time, on the Business Day on which such Lender receives
notice from the Administrative Agent of such payment or disbursement (it being
understood that any such notice received after noon, Chicago time, on any
Business Day shall be deemed to have been received on the next following
Business Day), such Lender agrees to pay interest on such amount to the
Administrative Agent for the Issuing Lender's account forthwith on demand, for
each day from the date such amount was to have been delivered to the
Administrative Agent to the date such amount is paid, at a rate per annum equal
to (a) for the first three days after demand, the Federal Funds Rate from time
to time in effect and (b) thereafter, the Base Rate from time to time in effect.
Any Lender's failure to make available to the Administrative Agent its Pro Rata
Share of any such payment or disbursement shall not relieve any other Lender of
its obligation hereunder to make available to the Administrative Agent such
other Lender's Pro Rata Share of such payment, but no Lender shall be
responsible for the failure of any other Lender to make available to the
Administrative Agent such other Lender's Pro Rata Share of any such payment or
disbursement.
2.4 Commitments Several. The failure of any Lender to make a
requested Loan on any date shall not relieve any other Lender of its obligation
(if any) to make a Loan on such date, but no Lender shall be responsible for the
failure of any other Lender to make any Loan to be made by such other Lender.
2.5 Certain Conditions. Except as otherwise provided in this
Agreement, no Lender shall have an obligation to make any Loan, or to permit the
continuation of or any conversion into any LIBOR Loan, and the Issuing Lender
shall not have any obligation to issue any Letter of Credit, if an Event of
Default or Default exists.
SECTION 3 EVIDENCING OF LOANS.
3.1 Notes. The Loans of each Lender shall be evidenced by a Note,
with appropriate insertions, payable to the order of such Lender in a face
principal amount equal to such Lender's Revolving Loan Commitment.
3.2 Recordkeeping. The Administrative Agent, on behalf of each
Lender, shall record in its records, the date and amount of each Loan made by
each Lender, each repayment or conversion thereof and, in the case of each LIBOR
Loan, the dates on which each Interest Period for such Loan shall begin and end.
The aggregate unpaid principal amount so recorded shall be rebuttably
presumptive evidence of the principal amount of the Loans owing and unpaid. The
failure to so record any such amount or any error in so recording any such
amount shall not, however, limit or otherwise affect the Obligations of the
Company hereunder or under any Note to repay the principal amount of the Loans
hereunder, together with all interest accruing thereon.
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SECTION 4 INTEREST.
4.1 Interest Rates. The Company promises to pay interest on the
unpaid principal amount of each Loan for the period commencing on the date of
such Loan until such Loan is paid in full as follows:
(a) at all times while such Loan is a Base Rate Loan, at a rate
per annum equal to the sum of the Base Rate from time to time in effect plus the
Base Rate Margin from time to time in effect; and
(b) at all times while such Loan is a LIBOR Loan, at a rate per
annum equal to the sum of the LIBOR Rate applicable to each Interest Period for
such Loan plus the LIBOR Margin from time to time in effect;
provided that at any time an Event of Default exists, and only as long as it
continues, unless the Required Lenders otherwise consent, the interest rate
applicable to each Loan shall be increased by 2% (and, in the case of
Obligations not bearing interest, such Obligations shall bear interest at the
Base Rate applicable to Revolving Loans plus 2%), provided further that such
increase may thereafter be rescinded by the Required Lenders, notwithstanding
Section 15.1. Notwithstanding the foregoing, upon the occurrence of an Event of
Default under Section 13.1.1 or 13.1.4, such increase shall occur automatically.
4.2 Interest Payment Dates. Accrued interest on each Base Rate
Loan shall be payable in arrears on the first day of each calendar month, upon a
prepayment of such Loan and at maturity. Accrued interest on each LIBOR Loan
shall be payable on the last day of each Interest Period relating to such Loan
(and, in the case of a LIBOR Loan with an Interest Period in excess of three
months, on the three-month anniversary of the first day of such Interest
Period), upon a prepayment of such Loan, and at maturity. After maturity, and at
any time an Event of Default exists, accrued interest on all Loans shall be
payable on demand.
4.3 Setting and Notice of LIBOR Rates. The applicable LIBOR Rate
for each Interest Period shall be determined by the Administrative Agent, and
notice thereof shall be given by the Administrative Agent promptly to the
Company and each Lender. Each determination of the applicable LIBOR Rate by the
Administrative Agent shall be conclusive and binding upon the parties hereto, in
the absence of demonstrable error. The Administrative Agent shall, upon written
request of the Company or any Lender, deliver to the Company or such Lender a
statement showing the computations used by the Administrative Agent in
determining any applicable LIBOR Rate hereunder.
4.4 Computation of Interest. Interest shall be computed for the
actual number of days elapsed on the basis of a year of 365/366 days for
purposes of each Base Rate Loan, and 360 days for each LIBOR Loan. The
applicable interest rate for each Base Rate Loan shall change simultaneously
with each change in the Base Rate.
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SECTION 5 FEES.
5.1 Non-Use Fee. The Company agrees to pay to the Administrative
Agent for the account of each Lender a non-use fee ("Non-Use Fee"), for the
period from the Closing Date to the Termination Date, at the Non-Use Fee Rate of
such Lender's Pro Rata Share (as adjusted from time to time) of the average
daily unused amount of the Revolving Commitment calculated on a quarterly basis.
For purposes of calculating usage under this Section, the Revolving Commitment
shall be deemed used to the extent of Revolving Outstandings. Such Non-Use Fee
shall be payable in arrears on the first day of each calendar quarter and on the
Termination Date for any period then ending for which such non-use fee shall not
have previously been paid. The Non-Use Fee shall be computed for the actual
number of days elapsed on the basis of a year of 360 days.
5.2 Letter of Credit Fees. (a) The Company agrees to pay to the
Administrative Agent for the account of each Lender a letter of credit fee for
each Letter of Credit equal to the L/C Fee Rate of such Lender's Pro Rata Share
(as adjusted from time to time) of the undrawn amount of such Letter of Credit
(computed for the actual number of days elapsed on the basis of a year of 360
days); provided that, unless the Required Lenders otherwise consent, the rate
applicable to each Letter of Credit shall be increased by 2% at any time, but
only for so long as, that an Event of Default exists. Such letter of credit fee
shall be payable in arrears on the first day of each calendar quarter and on the
Termination Date (or such later date on which such Letter of Credit expires or
is terminated) for the period from the date of the issuance of each Letter of
Credit (or the last day on which the letter of credit fee was paid with respect
thereto) to the date such payment is due or, if earlier, the date on which such
Letter of Credit expired or was terminated.
(b) In addition, with respect to each Letter of Credit, the
Company agrees to pay to the Issuing Lender, for its own account, (i) such fees
and expenses as the Issuing Lender customarily requires in connection with the
issuance, negotiation, processing and/or administration of letters of credit in
similar situations and (ii) a letter of credit fronting fee in the amount and at
the times agreed to by the Company and the Issuing Lender.
5.3 Administrative Agent's Fees. The Company agrees to pay to the
Administrative Agent such agent's fees set forth in the Commitment Letter.
5.4 Closing Fee. The Company shall pay the Initiating Lenders a
closing fee as set forth in the Commitment Letter.
5.5 Arrangement Fee. The Company shall pay the Initiating Lenders
a one-time arrangement fee as set forth in the Commitment Letter.
SECTION 6 REDUCTION OR TERMINATION OF THE REVOLVING COMMITMENT;
PREPAYMENTS.
6.1 Reduction or Termination of the Revolving Commitment.
26
6.1.1 Voluntary Reduction or Termination of the Revolving
Commitment. The Company may from time to time on at least five (5) Business
Days' prior written notice received by the Administrative Agent (which shall
promptly advise each Lender thereof) permanently reduce the Revolving Commitment
to an amount not less than the Revolving Outstandings. Any such reduction shall
be in an amount not less than One Million and No/100 Dollars ($1,000,000.00) or
a higher integral multiple of One Hundred Thousand and No/100 Dollars
($100,000.00). Concurrently with any reduction of the Revolving Commitment to
zero, the Company shall pay all interest on the Revolving Loans, all non-use
fees and all letter of credit fees and shall Cash Collateralize in full all
obligations arising with respect to the Letters of Credit.
6.1.2 Mandatory Reductions of Revolving Commitment. On the date of
any Mandatory Prepayment Event, the Revolving Commitment shall not be reduced by
any amount.
6.1.3 All Reductions of the Revolving Commitment. All reductions of
the Revolving Commitment shall reduce the Commitments ratably among the Lenders
according to their respective Pro Rata Shares.
6.2 Prepayments.
6.2.1 Voluntary Prepayments. The Company may from time to time
prepay the Loans in whole or in part; provided that the Company shall give the
Administrative Agent (which shall promptly advise each Lender) notice thereof
not later than 12:00 P.M., Chicago time, on the day of such prepayment (which
shall be a Business Day), specifying the Loans to be prepaid and the date and
amount of prepayment. Any such partial prepayment shall be in an amount equal to
Five Hundred Thousand and No/100 Dollars ($500,000.00) or a higher integral
multiple of One Hundred Thousand and No/100 Dollars ($100,000.00) for Base Rate
Loans and One Million and No/100 Dollars ($1,000,000.00) or a higher integral
multiple of One Hundred Thousand and No/100 Dollars ($100,000.00) for LIBOR
Loans.
6.2.2 Mandatory Prepayments.
(a) The Company shall make a prepayment of the Loans until paid in
full upon the occurrence of any of the following (each a "Mandatory Prepayment
Event") at the following times and in the following amounts (such applicable
amounts being referred to as "Designated Proceeds"):
(i) Concurrently with the receipt by any Loan Party of
any Net Cash Proceeds from any Asset Disposition, in
an amount equal to 100% of such Net Cash Proceeds.
(ii) Concurrently with the receipt by any Loan Party of
any Net Cash Proceeds from any [private equity]
issuance of Capital Securities of any Loan Party
(excluding (x) any issuance of Capital Securities
pursuant to any employee or director option program,
benefit plan or compensation program and (y)
27
any issuance by a Subsidiary to the Company or
another Subsidiary), in an amount equal to 100% of
such Net Cash Proceeds (except to the extent such
proceeds are intended to be, and in fact are,
reinvested within 180 days from such date of
issuance).
(iii) Concurrently with the receipt by any Loan Party of
any Net Cash Proceeds from any issuance of any Debt
of any Loan Party (excluding Debt permitted by
Section 11.1 hereof), in an amount equal to 100% of
such Net Cash Proceeds to the extent not used for
acquisitions by a Loan Party within one hundred
eighty (180) days thereafter.
(b) If on any day the Revolving Outstandings exceeds the Borrowing
Base, the Company shall immediately prepay Revolving Loans and/or Cash
Collateralize the outstanding Letters of Credit, or do a combination of the
foregoing, in an amount sufficient to eliminate such excess.
(c) If on any day on which the Revolving Commitment is reduced
pursuant to Section 6.1.2 the Revolving Outstandings exceeds the Revolving
Commitment, the Company shall immediately prepay Revolving Loans or Cash
Collateralize the outstanding Letters of Credit, or do a combination of the
foregoing, in an amount sufficient to eliminate such excess.
6.3 Manner of Prepayments.
6.3.1 All Prepayments. Each voluntary partial prepayment shall be in
a principal amount of Five Hundred Thousand and No/100 Dollars ($500,000.00) or
a higher integral multiple of One Hundred Thousand and No/100 Dollars
($100,000.00) for Base Rate Loans and One Million and No/100 Dollars
($1,000,000.00) or a higher integral multiple of One Hundred Thousand and No/100
Dollars ($100,000.00) for LIBOR Loans. Any partial prepayment of a Group of
LIBOR Loans shall be subject to the proviso of Section 2.2.3(a). Any prepayment
of a LIBOR Loan on a day other than the last day of an Interest Period therefor
shall include interest on the principal amount being repaid and shall be subject
to Section 8.4. Except as otherwise provided by this Agreement, all principal
payments in respect of the Loans shall be applied first, to repay outstanding
Base Rate Loans and then to repay outstanding LIBOR Rate Loans in direct order
of Interest Period maturities.
6.4 Repayments.
6.4.1 Revolving Loans. The Revolving Loans of each Lender shall be
paid in full and the Revolving Commitment shall terminate on the Termination
Date.
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.
7.1 Making of Payments. All payments of principal or interest on
the Notes, and of all fees, shall be made by the Company to the Administrative
Agent in immediately available funds at the office specified by the
Administrative Agent not later than 1:00 p.m., Chicago time,
28
on the date due; and funds received after that hour shall be deemed to have been
received by the Administrative Agent on the following Business Day. The
Administrative Agent shall promptly remit to each Lender its share of all such
payments received in collected funds by the Administrative Agent for the account
of such Lender. All payments under Section 8.1 shall be made by the Company
directly to the Lender entitled thereto without setoff, counterclaim or other
defense.
7.2 Application of Certain Payments. So long as no Default or
Event of Default has occurred and is continuing, (a) payments matching specific
scheduled payments then due shall be applied to those scheduled payments and (b)
voluntary and mandatory prepayments shall be applied as set forth in Sections
6.2 and 6.3. After the occurrence and during the continuance of an Default or
Event of Default, all amounts collected or received by the any Agent or any
Lender as proceeds from the sale of, or other realization upon, all or any part
of the collateral shall be applied as the Agents shall determine in their
discretion or, in the absence of a specific determination by the Agents, as set
forth in the Guaranty and Collateral Agreement. Concurrently with each
remittance to any Lender of its share of any such payment, the Administrative
Agent shall advise such Lender as to the application of such payment.
7.3 Due Date Extension. If any payment of principal or interest
with respect to any of the Loans, or of any fees, falls due on a day which is
not a Business Day, then such due date shall be extended to the immediately
following Business Day (unless, in the case of a LIBOR Loan, such immediately
following Business Day is the first Business Day of a calendar month, in which
case such due date shall be the immediately preceding Business Day) and, in the
case of principal, additional interest shall accrue and be payable for the
period of any such extension.
7.4 Setoff. The Company agrees that the Collateral Agent,
Administrative Agent and each Lender have all rights of set-off and bankers'
lien provided by applicable law, and in addition thereto, the Company agrees
that at any time any Event of Default exists, the Administrative Agent and each
Lender may apply to the payment of any Obligations of the Company hereunder,
whether or not then due, any and all balances, credits, deposits, accounts or
moneys of the Company then or thereafter with the Administrative Agent or such
Lender.
7.5 Proration of Payments. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of offset or
otherwise), on account of (a) principal of or interest on any Loan, but
excluding (i) any payment pursuant to Section 5, Section 8.7 or 15.6, (ii)
payments of interest on any Affected Loan or (iii) payments to LaSalle with
respect to the letter of credit supporting an existing IRB or to GE CAPITAL with
respect to the Existing Term Loan; or (iv) payments to GE Capital with respect
to the lease of the property in Brownsville, Texas or the "aircraft lease"
pertaining to the private aircraft used by the Company, or (b) its participation
in any Letter of Credit in excess of its applicable Pro Rata Share of payments
and other recoveries obtained by all Lenders on account of principal of and
interest on the Loans (or such participation) then held by them, then such
Lender shall purchase from the other Lenders such participations in the Loans
(or sub-participations in Letters of Credit) held by them as shall be necessary
to cause such purchasing Lender to share the excess payment or other
29
recovery ratably with each of them; provided that if all or any portion of the
excess payment or other recovery is thereafter recovered from such purchasing
Lender, the purchase shall be rescinded and the purchase price restored to the
extent of such recovery.
7.6 Taxes.
(a) All payments made by the Company hereunder or under any Loan
Documents shall be made without setoff, counterclaim, or other defense. To the
extent permitted by applicable law, all payments hereunder or under the Loan
Documents (including any payment of principal, interest, or fees) to, or for the
benefit, of any person shall be made by the Company free and clear of and
without deduction or withholding for, or account of, any Taxes now or
hereinafter imposed by any taxing authority.
(b) If the Company makes any payment hereunder or under any Loan
Document in respect of which it is required by applicable law to deduct or
withhold any Taxes, the Company shall increase the payment hereunder or under
any such Loan Document such that after the reduction for the amount of Taxes
withheld (and any taxes withheld or imposed with respect to the additional
payments required under this Section 7.6(b)), the amount paid to the Lenders or
the Administrative Agent equals the amount that was payable hereunder or under
any such Loan Document without regard to this Section 7.6(b). To the extent the
Company withholds any Taxes on payments hereunder or under any Loan Document,
the Company shall pay the full amount deducted to the relevant taxing authority
within the time allowed for payment under applicable law and shall deliver to
the Administrative Agent within 30 days after it has made payment to such
authority a receipt issued by such authority (or other evidence satisfactory to
the Administrative Agent) evidencing the payment of all amounts so required to
be deducted or withheld from such payment.
(c) If any Lender or any Agent is required by law to make any
payments of any Taxes on or in relation to any amounts received or receivable
hereunder or under any other Loan Document, or any Tax is assessed against a
Lender or an Agent with respect to amounts received or receivable hereunder or
under any other Loan Document, the Company will indemnify such person against
(i) such Tax (and any reasonable counsel fees and expenses associated with such
Tax) and (ii) any taxes imposed as a result of the receipt of the payment under
this Section 7.6(c). A certificate prepared in good faith as to the amount of
such payment by such Lender or Agent shall, absent manifest error, be final,
conclusive, and binding on all parties.
(d) (i) To the extent permitted by applicable law, each
Lender that is not a United States person within the meaning of Code section
7701(a)(30) (a "Non-U.S. Participant") shall deliver to the Company and the
Administrative Agent on or prior to the Closing Date (or in the case of a Lender
that is an Assignee, on the date of such assignment to such Lender) two accurate
and complete original signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or
any successor or other applicable form prescribed by the IRS) certifying to such
Lender's entitlement to a complete exemption from, or a reduced rate in, United
States withholding tax on interest payments to be made hereunder or any Loan. If
a Lender that is a Non-U.S. Participant
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is claiming a complete exemption from withholding on interest pursuant to
Sections 871(h) or 881(c) of the Code, the Lender shall deliver (along with two
accurate and complete original signed copies of IRS Form W-8BEN) a certificate
in form and substance reasonably acceptable to Administrative Agent (any such
certificate, a "Withholding Certificate"). In addition, each Lender that is a
Non-U.S. Participant agrees that from time to time after the Closing Date, (or
in the case of a Lender that is an Assignee, after the date of the assignment to
such Lender), when a lapse in time (or change in circumstances occurs) renders
the prior certificates hereunder obsolete or inaccurate in any material respect,
such Lender shall, to the extent permitted under applicable law, deliver to the
Company and the Administrative Agent two new and accurate and complete original
signed copies of an IRS Form W-8BEN, W-8ECI, or W-8IMY (or any successor or
other applicable forms prescribed by the IRS), and if applicable, a new
Withholding Certificate, to confirm or establish the entitlement of such Lender
or the Administrative Agent to an exemption from, or reduction in, United States
withholding tax on interest payments to be made hereunder or any Loan. No
Non-U.S. Participant shall become a Lender if such Person fails to deliver a
Withholding Certificate.
(ii) Each Lender that is not a Non-U.S. Participant (other than any
such Lender which is taxed as a corporation for U.S. federal income tax
purposes) shall provide two properly completed and duly executed copies of IRS
Form W-9 (or any successor or other applicable form) to the Company and the
Administrative Agent certifying that such Lender is exempt from United States
backup withholding tax. To the extent that a form provided pursuant to this
Section 7.6(d)(ii) is rendered obsolete or inaccurate in any material respects
as result of change in circumstances with respect to the status of a Lender,
such Lender shall, to the extent permitted by applicable law, deliver to the
Company and the Administrative Agent revised forms necessary to confirm or
establish the entitlement to such Lender's or Agent's exemption from United
States backup withholding tax.
(iii) The Company shall not be required to pay additional amounts to
a Lender, or indemnify any Lender, under this Section 7.6 to the extent that
such obligations would not have arisen but for the failure of such Lender to
comply with Section 7.6(d).
(iv) Each Lender agrees to indemnify the Administrative Agent and
hold the Administrative Agent harmless for the full amount of any and all
present or future Taxes and related liabilities (including penalties, interest,
additions to tax and expenses, and any Taxes imposed by any jurisdiction on
amounts payable to the Administrative Agent under this Section 7.6) which are
imposed on or with respect to principal, interest or fees payable to such Lender
hereunder and which are not paid by the Company pursuant to this Section 7.6,
whether or not such Taxes or related liabilities were correctly or legally
asserted. This indemnification shall be made within 30 days from the date the
Administrative Agent makes written demand therefor.
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR LIBOR LOANS.
8.1 Increased Costs. (a) If, after the date hereof, the adoption
of, or any change in, any applicable law, rule or regulation, or any change in
the interpretation or administration of
31
any applicable law, rule or regulation by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender with any request or directive (whether or
not having the force of law) of any such authority, central bank or comparable
agency: (i) shall impose, modify or deem applicable any reserve (including any
reserve imposed by the FRB, but excluding any reserve included in the
determination of the LIBOR Rate pursuant to Section 4), special deposit or
similar requirement against assets of, deposits with or for the account of, or
credit extended by any Lender; or (ii) shall impose on any Lender any other
condition affecting its LIBOR Loans, its Note or its obligation to make LIBOR
Loans; and the result of anything described in clauses (i) and (ii) above is to
increase the cost to (or to impose a cost on) such Lender (or any LIBOR Office
of such Lender) of making or maintaining any LIBOR Loan, or to reduce the amount
of any sum received or receivable by such Lender (or its LIBOR Office) under
this Agreement or under its Note with respect thereto, then upon demand by such
Lender (which demand shall be accompanied by a statement setting forth the basis
for such demand and a calculation of the amount thereof in reasonable detail, a
copy of which shall be furnished to the Administrative Agent), the Company shall
pay directly to such Lender such additional amount as will compensate such
Lender for such increased cost or such reduction, so long as such amounts have
accrued on or after the day which is 180 days prior to the date on which such
Lender first made demand therefor.
(b) If any Lender shall reasonably determine that any change in,
or the adoption or phase-in of, any applicable law, rule or regulation regarding
capital adequacy, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or the compliance by any Lender or
any Person controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's or such controlling Person's capital as a
consequence of such Lender's obligations hereunder or under any Letter of Credit
to a level below that which such Lender or such controlling Person could have
achieved but for such change, adoption, phase-in or compliance (taking into
consideration such Lender's or such controlling Person's policies with respect
to capital adequacy) by an amount deemed by such Lender or such controlling
Person to be material, then from time to time, upon demand by such Lender (which
demand shall be accompanied by a statement setting forth the basis for such
demand and a calculation of the amount thereof in reasonable detail, a copy of
which shall be furnished to the Administrative Agent), the Company shall pay to
such Lender such additional amount as will compensate such Lender or such
controlling Person for such reduction so long as such amounts have accrued on or
after the day which is 180 days prior to the date on which such Lender first
made demand therefor. Each Lender agrees that, a promptly as practicable after
it becomes aware of any circumstances referred to above which would result in
any such increased cost, the affected Lender shall, to the extent not
inconsistent with such Lender's internal policies of general application, use
reasonable commercial efforts to minimize costs and expenses incurred by it and
payable to it by Company pursuant to this Section.
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8.2 Basis for Determining Interest Rate Inadequate or Unfair. If
(a) the Administrative Agent reasonably determines (which
determination shall be binding and conclusive on the Company) that by reason of
circumstances affecting the interbank LIBOR market adequate and reasonable means
do not exist for ascertaining the applicable LIBOR Rate; or
(b) the Required Lenders advise the Administrative Agent that the
LIBOR Rate as determined by the Administrative Agent will not adequately and
fairly reflect the cost to such Lenders of maintaining or funding LIBOR Loans
for such Interest Period (taking into account any amount to which such Lenders
may be entitled under Section 8.1) or that the making or funding of LIBOR Loans
has become impracticable as a result of an event occurring after the date of
this Agreement which in the opinion of such Lenders materially affects such
Loans;
then the Administrative Agent shall promptly notify the other parties thereof
and, so long as such circumstances shall continue, (i) no Lender shall be under
any obligation to make or convert any Base Rate Loans into LIBOR Loans and (ii)
on the last day of the current Interest Period for each LIBOR Loan, such Loan
shall, unless then repaid in full, automatically convert to a Base Rate Loan.
8.3 Changes in Law Rendering LIBOR Loans Unlawful. If any change
in, or the adoption of any new, law or regulation, or any change in the
interpretation of any applicable law or regulation by any governmental or other
regulatory body charged with the administration thereof, should make it (or in
the good faith judgment of any Lender cause a substantial question as to whether
it is) unlawful for any Lender to make, maintain or fund LIBOR Loans, then such
Lender shall promptly notify each of the other parties hereto and, so long as
such circumstances shall continue, (a) such Lender shall have no obligation to
make or convert any Base Rate Loan into a LIBOR Loan (but shall make Base Rate
Loans concurrently with the making of or conversion of Base Rate Loans into
LIBOR Loans by the Lenders which are not so affected, in each case in an amount
equal to the amount of LIBOR Loans which would be made or converted into by such
Lender at such time in the absence of such circumstances) and (b) on the last
day of the current Interest Period for each LIBOR Loan of such Lender (or, in
any event, on such earlier date as may be required by the relevant law,
regulation or interpretation), such LIBOR Loan shall, unless then repaid in
full, automatically convert to a Base Rate Loan. Each Base Rate Loan made by a
Lender which, but for the circumstances described in the foregoing sentence,
would be a LIBOR Loan (an "Affected Loan") shall remain outstanding for the
period corresponding to the Group of LIBOR Loans of which such Affected Loan
would be a part absent such circumstances.
8.4 Funding Losses. The Company hereby agrees that upon demand by
any Lender (which demand shall be accompanied by a statement setting forth the
basis for the amount being claimed, a copy of which shall be furnished to the
Administrative Agent), the Company will indemnify such Lender against any net
loss or expense which such Lender may sustain or incur (including any net loss
or expense incurred by reason of the liquidation or reemployment of
33
deposits or other funds acquired by such Lender to fund or maintain any LIBOR
Loan), as reasonably determined by such Lender, as a result of (a) any payment,
prepayment or conversion of any LIBOR Loan of such Lender on a date other than
the last day of an Interest Period for such Loan (including any conversion
pursuant to Section 8.3) or (b) any failure of the Company to borrow, convert or
continue any Loan on a date specified therefor in a notice of borrowing,
conversion or continuation pursuant to this Agreement. For this purpose, all
notices to the Administrative Agent pursuant to this Agreement shall be deemed
to be irrevocable.
8.5 Right of Lenders to Fund through Other Offices. Each Lender
may, if it so elects, fulfill its commitment as to any LIBOR Loan by causing a
foreign branch or Affiliate of such Lender to make such Loan; provided that in
such event for the purposes of this Agreement such Loan shall be deemed to have
been made by such Lender and the obligation of the Company to repay such Loan
shall nevertheless be to such Lender and shall be deemed held by it, to the
extent of such Loan, for the account of such branch or Affiliate.
8.6 Discretion of Lenders as to Manner of Funding. Notwithstanding
any provision of this Agreement to the contrary, each Lender shall be entitled
to fund and maintain its funding of all or any part of its Loans in any manner
it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations hereunder shall be made as if such Lender had
actually funded and maintained each LIBOR Loan during each Interest Period for
such Loan through the purchase of deposits having a maturity corresponding to
such Interest Period and bearing an interest rate equal to the LIBOR Rate for
such Interest Period.
8.7 Mitigation of Circumstances; Replacement of Lenders. (a) Each
Lender shall promptly notify the Company and the Administrative Agent of any
event of which it has knowledge which will result in, and will use reasonable
commercial efforts available to it (and not, in such Lender's sole judgment,
otherwise disadvantageous to such Lender) to mitigate or avoid, (i) any
obligation by the Company to pay any amount pursuant to Section 7.6 or 8.1 or
(ii) the occurrence of any circumstances described in Section 8.2 or 8.3 (and,
if any Lender has given notice of any such event described in clause (i) or (ii)
above and thereafter such event ceases to exist, such Lender shall promptly so
notify the Company and the Administrative Agent). Without limiting the
foregoing, each Lender will designate a different funding office if such
designation will avoid (or reduce the cost to the Company of) any event
described in clause (i) or (ii) above and such designation will not, in such
Lender's sole judgment, be otherwise disadvantageous to such Lender.
(b) If the Company becomes obligated to pay additional amounts to
any Lender pursuant to Section 7.6 or 8.1, or any Lender gives notice of the
occurrence of any circumstances described in Section 8.2 or 8.3, the Company may
designate another bank which is acceptable to the Agents and the Issuing Lender
in their reasonable discretion (such other bank being called a "Replacement
Lender") to purchase the Loans of such Lender and such Lender's rights
hereunder, without recourse to or warranty by, or expense to, such Lender, for a
purchase price equal to the outstanding principal amount of the Loans payable to
such Lender plus any accrued but unpaid interest on such Loans and all accrued
but unpaid fees owed to such Lender and any
34
other amounts payable to such Lender under this Agreement, and to assume all the
obligations of such Lender hereunder, and, upon such purchase and assumption
(pursuant to an Assignment Agreement), such Lender shall no longer be a party
hereto or have any rights hereunder (other than rights with respect to
indemnities and similar rights applicable to such Lender prior to the date of
such purchase and assumption) and shall be relieved from all obligations to the
Company hereunder, and the Replacement Lender shall succeed to the rights and
obligations of such Lender hereunder.
8.8 Conclusiveness of Statements; Survival of Provisions.
Determinations and statements of any Lender pursuant to Section 8.1, 8.2, 8.3 or
8.4 shall be conclusive absent demonstrable error. Lenders may use reasonable
averaging and attribution methods in determining compensation under Sections 8.1
and 8.4, and the provisions of such Sections shall survive repayment of the
Obligations, cancellation of any Notes, expiration or termination of the Letters
of Credit and termination of this Agreement.
SECTION 9 REPRESENTATIONS AND WARRANTIES.
To induce the Agents and the Lenders to enter into this Agreement and
to induce the Lenders to make Loans and issue and participate in Letters of
Credit hereunder, the Company represents and warrants to the Agents and the
Lenders that:
9.1 Organization. Each Loan Party is validly existing and in good
standing under the laws of its jurisdiction of organization; and each Loan Party
is duly qualified to do business in each jurisdiction where, because of the
nature of its activities or properties, such qualification is required, except
for such jurisdictions where the failure to so qualify would not have a Material
Adverse Effect.
9.2 Authorization; No Conflict. Each Loan Party is duly authorized
to execute and deliver each Loan Document to which it is a party, the Company is
duly authorized to borrow monies hereunder and each Loan Party is duly
authorized to perform its Obligations under each Loan Document to which it is a
party. The execution, delivery and performance by each Loan Party of each Loan
Document to which it is a party, and the borrowings by the Company hereunder, do
not and will not (a) require any consent or approval of any governmental agency
or authority (other than any consent or approval which has been obtained and is
in full force and effect), (b) conflict with (i) any provision of law, (ii) the
charter, by-laws or other organizational documents of any Loan Party or (iii)
any agreement, indenture, instrument or other document, or any judgment, order
or decree, which is binding upon any Loan Party or any of their respective
properties or (c) require, or result in, the creation or imposition of any Lien
on any asset of any Loan Party (other than Liens in favor of the Administrative
Agent created pursuant to the Collateral Documents).
9.3 Validity and Binding Nature. Each of this Agreement and each
other Loan Document to which any Loan Party is a party is the legal, valid and
binding obligation of such Person, enforceable against such Person in accordance
with its terms, subject to bankruptcy,
35
insolvency and similar laws affecting the enforceability of creditors' rights
generally and to general principles of equity.
9.4 Financial Condition. The audited consolidated financial
statements of the Company and its Subsidiaries as at Company's Fiscal Year 2003,
and the unaudited consolidated condensed financial statements of the Company and
the Subsidiaries as at March 31, 2004, copies of each of which have been
delivered to each Lender, were prepared in accordance with GAAP (subject, in the
case of such unaudited statements, to the absence of footnotes and to normal
year-end adjustments) and present fairly the consolidated financial condition of
the Company and its Subsidiaries as at such date(s) and the results of their
operations for the periods then ended.
9.5 No Material Adverse Change. Since Company's Fiscal Year 2003,
there has been no material adverse change in the financial condition,
operations, assets, business, properties or prospects of the Loan Parties taken
as a whole.
9.6 Litigation and Contingent Liabilities. No litigation
(including derivative actions), arbitration proceeding or governmental
investigation or proceeding is pending or, to the Company's knowledge,
threatened against any Loan Party which might reasonably be expected to have a
Material Adverse Effect, except as set forth in Schedule 9.6. Other than any
liability incident to such litigation or proceedings, no Loan Party has any
material contingent liabilities not listed on Schedule 9.6 or permitted by
Section 11.1.
9.7 Ownership of Properties; Liens. Each Loan Party owns good and,
in the case of real property, marketable title to all of its properties and
assets, real and personal, tangible and intangible, of any nature whatsoever
(including patents, trademarks, trade names, service marks and copyrights), free
and clear of all Liens, charges and claims (including infringement claims with
respect to patents, trademarks, service marks, copyrights and the like) except
as permitted by Section 11.2.
9.8 Equity Ownership; Subsidiaries. All issued and outstanding
Capital Securities of each Domestic Subsidiary are duly authorized and validly
issued, fully paid, non-assessable, and free and clear of all Liens other than
those in favor of the Administrative Agent, and such securities were issued in
compliance with all applicable state and federal laws concerning the issuance of
securities. Schedule 9.8 sets forth the authorized Capital Securities of each
Domestic Subsidiary as of the Closing Date and all of the issued and outstanding
Capital Securities of each Domestic Subsidiary is, directly or indirectly, owned
by the Company. As of the Closing Date, except as set forth on Schedule 9.8,
there are no pre-emptive or other outstanding rights, options, warrants,
conversion rights or other similar agreements or understandings for the purchase
or acquisition of any Capital Securities of any Domestic Subsidiary.
9.9 Pension Plans. (a) Each Pension Plan complies in all material
respects with all applicable requirements of law and regulations. No
contribution failure under Section 412 of the Code, Section 302 of ERISA or the
terms of any Pension Plan has occurred with respect to any
36
Pension Plan, sufficient to give rise to a Lien under Section 302(f) of ERISA,
or otherwise to have a Material Adverse Effect. There are no pending or, to the
knowledge of Company, threatened, claims, actions, investigations or lawsuits
against any Pension Plan, any fiduciary of any Pension Plan, or Company or other
any member of the Controlled Group with respect to a Pension Plan which could
reasonably be expected to have a Material Adverse Effect. Neither the Company
nor any other member of the Controlled Group has engaged in any prohibited
transaction (as defined in Section 4975 of the Code or Section 406 of ERISA) in
connection with any Pension Plan which would subject that Person to any material
liability. Within the past five years, neither the Company nor any other member
of the Controlled Group has engaged in a transaction which resulted in a Pension
Plan with an Unfunded Liability being transferred out of the Controlled Group,
which could reasonably be expected to have a Material Adverse Effect. No
Termination Event has occurred or is reasonably expected to occur with respect
to any Pension Plan, which could reasonably be expected to have a Material
Adverse Effect.
(b) All contributions (if any) have been made to any Multiemployer
Pension Plan that are required to be made by the Company or any other member of
the Controlled Group under the terms of the plan or of any collective bargaining
agreement or by applicable law; neither the Company nor any other member of the
Controlled Group has withdrawn or partially withdrawn from any Multiemployer
Pension Plan, incurred any withdrawal liability with respect to any such plan or
received notice of any claim or demand for withdrawal liability or partial
withdrawal liability from any such plan, and no condition has occurred which, if
continued, could result in a withdrawal or partial withdrawal from any such plan
[which would have a Material Adverse Effect]; and neither the Company nor any
other member of the Controlled Group has received any notice that any
Multiemployer Pension Plan is in reorganization, that increased contributions
may be required to avoid a reduction in plan benefits or the imposition of any
excise tax, that any such plan is or has been funded at a rate less than that
required under Section 412 of the Code, that any such plan is or may be
terminated [which could reasonably be expected to have a Material Adverse
Effect], or that any such plan is or may become insolvent.
9.10 Investment Company Act. No Loan Party is an "investment
company" or a company "controlled" by an "investment company" or a "subsidiary"
of an "investment company," within the meaning of the Investment Company Act of
1940.
9.11 Public Utility Holding Company Act. No Loan Party is a
"holding company", or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935.
9.12 Regulation U. The Company is not engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying Margin Stock.
9.13 Taxes. Each Loan Party has timely filed all tax returns and
reports required by law to have been filed by it and has paid all taxes and
governmental charges due and payable
37
with respect to such return, except any such taxes or charges which are being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its
books. The Loan Parties have made adequate reserves on their books and records
in accordance with GAAP for all taxes that have accrued but which are not yet
due and payable. No Loan Party has participated in any transaction that relates
to a year of the taxpayer (which is still open under the applicable statute of
limitations) which is a "reportable transaction" within the meaning of Treasury
Regulation Section 1.6011-4(b)(2) (irrespective of the date when the transaction
was entered into).
9.14 Solvency, etc. On the Closing Date, and immediately prior to
and after giving effect to the issuance of each Letter of Credit and each
borrowing hereunder and the use of the proceeds thereof, with respect to each
Loan Party other than as set forth in Schedule 9.14 hereto, individually, (a)
the fair value of its assets is greater than the amount of its liabilities
(including disputed, contingent and unliquidated liabilities) as such value is
established and liabilities evaluated in accordance with GAAP, (b) the present
fair saleable value of its assets is not less than the amount that will be
required to pay the probable liability on its debts as they become absolute and
matured, (c) it is able to realize upon its assets and pay its debts and other
liabilities (including disputed, contingent and unliquidated liabilities) as
they mature in the normal course of business, (d) it does not intend to, and
does not believe that it will, incur debts or liabilities beyond its ability to
pay as such debts and liabilities mature and (e) it is not engaged in business
or a transaction, and is not about to engage in business or a transaction, for
which its property would constitute unreasonably small capital.
9.15 Environmental Matters. The on-going operations of each Loan
Party comply in all respects with all Environmental Laws, except such
non-compliance which could not (if enforced in accordance with applicable law)
reasonably be expected to result, either individually or in the aggregate, in a
Material Adverse Effect. Each Loan Party has obtained, and maintained in good
standing, all licenses, permits, authorizations, registrations and other
approvals required under any Environmental Law and required for their respective
ordinary course operations, and for their reasonably anticipated future
operations, and each Loan Party is in compliance with all terms and conditions
thereof, except where the failure to do so could not reasonably be expected to
result in material liability to any Loan Party and could not reasonably be
expected to result, either individually or in the aggregate, in a Material
Adverse Effect. No Loan Party or any of its properties or operations is subject
to, or reasonably anticipates the issuance of, any written order from or
agreement with any Federal, state or local governmental authority, nor subject
to any judicial or docketed administrative or other proceeding, respecting any
Environmental Law, Environmental Claim or Hazardous Substance. There are no
Hazardous Substances or other conditions or circumstances existing with respect
to any property, arising from operations prior to the Closing Date, or relating
to any waste disposal, of any Loan Party that would reasonably be expected to
result, either individually or in the aggregate, in a Material Adverse Effect.
No Loan Party has any underground storage tanks that are not properly registered
or permitted under applicable Environmental Laws or, to the best of Company's
knowledge, have released, leaked, disposed of or otherwise discharged Hazardous
Substances.
38
9.16 Insurance. Set forth on Schedule 9.16 is a complete and
materially accurate summary of the property and casualty insurance program of
the Loan Parties as of the Closing Date (including the names of all insurers,
policy numbers, expiration dates, amounts and types of coverage, annual
premiums, exclusions, deductibles, self-insured retention, and a description in
reasonable detail of any self-insurance program, retrospective rating plan,
fronting arrangement or other risk assumption arrangement involving any Loan
Party). Each Loan Party and its properties are insured with financially sound
and reputable insurance companies which are not Affiliates of the Loan Parties,
in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where such Loan Parties operate.
9.17 Real Property. Set forth on Schedule 9.17 is a complete and
materially accurate list, as of the Closing Date, of the address of all real
property owned or leased by any Loan Party, together with, in the case of leased
property, the name and mailing address of the lessor of such property.
9.18 Information. All information heretofore or contemporaneously
herewith furnished in writing by any Loan Party to the Administrative Agent or
any Lender for purposes of or in connection with this Agreement and the
transactions contemplated hereby is, and all written information hereafter
furnished by or on behalf of any Loan Party to the Administrative Agent or any
Lender 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 none of such information is or will be incomplete by omitting to
state any material fact necessary to make such information not misleading in
light of the circumstances under which made (it being recognized by the
Administrative Agent and the Lenders that any projections and forecasts provided
by the Company are based on good faith estimates and assumptions believed by the
Company to be reasonable as of the date of the applicable projections or
assumptions and that actual results during the period or periods covered by any
such projections and forecasts may differ from projected or forecasted results).
The Lenders acknowledged that these projections and forecasts are based on the
Company's expectations and are subject to a number of risks and uncertainties,
certain of which are beyond the Company's control. Actual results could differ
materially from these projections and forecasts as a result of certain factors,
including, (i) changes in the Company's end-user markets as a result of world
economics or regulatory influences, (ii) fluctuations in currency translations,
(iii) changes in the competitors, (iv) availability and price of raw materials,
(v) levels of operating efficiencies, (vi) actions of domestic and foreign
governments, (vii) results of investments, and (viii) ability to secure
financing at reasonable terms. Any changes in such factors could lead to
significantly different results. The Company undertakes no obligation to update
or revise any such projections or forecasts, whether as a result of new
information, future events or otherwise. In light of these risks and
uncertainties, there can be no assurance that the projections and forecasts
contained in this Agreement will in fact transpire.
9.19 Intellectual Property. Each Loan Party owns and possesses or
has a license or other right to use all patents, patent rights, trademarks,
trademark rights, trade names, trade name
39
rights, service marks, service xxxx rights and copyrights as are necessary for
the conduct of the businesses of the Loan Parties, without any infringement upon
rights of others which could reasonably be expected to have a Material Adverse
Effect.
9.20 Burdensome Obligations. No Loan Party is a party to any
agreement or contract or subject to any restriction contained in its
organizational documents which could reasonably be expected to have a Material
Adverse Effect.
9.21 Labor Matters. Except as set forth on Schedule 9.21, no Loan
Party is subject to any labor or collective bargaining agreement. There are no
existing or threatened strikes, lockouts or other labor disputes involving any
Loan Party that singly or in the aggregate could reasonably be expected to have
a Material Adverse Effect. Hours worked by and payment made to employees of the
Loan Parties are not in violation of the Fair Labor Standards Act or any other
applicable law, rule or regulation dealing with such matters which could
reasonably be expected to have a Material Adverse Effect.
9.22 No Default. No Event of Default or Default exists or would
result from the incurrence by any Loan Party of any Debt hereunder or under any
other Loan Document.
9.23 Subordinated Debt. The subordination provisions of the
Subordinated Debt are enforceable against the holders of the Subordinated Debt
by the Administrative Agent and the Lenders. All Obligations constitute
"Designated Senior Indebtedness" as defined in that certain Indenture, dated as
of March 21, 1997, with respect to the Subordinated Notes and are entitled to
the benefits of the subordination provisions contained in the Subordinated
Notes. The Company acknowledges that the Administrative Agent and each Lender
are entering into this Agreement and are extending the Commitments and making
the Loans in reliance upon the subordination provisions of the Subordinated
Notes and this Section 9.23.
9.24 Subsidiary Assets. No Subsidiary, other than the Foreign
Subsidiaries and Domestic Subsidiaries, owns assets other than as disclosed on
Schedule 9.24, which Schedule describes both the type and approximate value of
such assets.
SECTION 10 AFFIRMATIVE COVENANTS.
Until the expiration or termination of the Commitments and thereafter
until all Obligations hereunder and under the other Loan Documents are paid in
full and all Letters of Credit have been terminated, the Company agrees that,
unless at any time the Required Lenders shall otherwise expressly consent in
writing, it will:
10.1 Reports, Certificates and Other Information. Except as such
information is available to the public by disclosures required by the United
States Securities and Exchange Commission, furnish to the Administrative Agent
and each Lender:
10.1.1 Annual Report. Promptly when available and in any event within
90 days after the close of each Fiscal Year: (a) a copy of the annual audit
report of the Company and its
40
Subsidiaries for such Fiscal Year, including therein consolidated balance sheets
and statements of earnings and cash flows of the Company and its Subsidiaries as
at the end of such Fiscal Year, certified without adverse reference to going
concern value and without qualification by independent auditors of recognized
standing selected by the Company and reasonably acceptable to the Administrative
Agent, together with (i) to the extent the Company's independent auditors will
provide it, a written statement from such accountants to the effect that in
making the examination necessary for the signing of such annual audit report by
such accountants, nothing came to their attention that caused them to believe
that the Company was not in compliance with any provision of Section 11.1, 11.3,
11.4 or 11.14 of this Agreement insofar as such provision relates to accounting
matters or, if something has come to their attention that caused them to believe
that the Company was not in compliance with any such provision, describing such
non-compliance in reasonable detail.
10.1.2 Interim Reports. (a) Promptly when available and in any event
within 45 days after the end of each Fiscal Quarter, consolidated and
consolidating balance sheets of the Company and its Subsidiaries as of the end
of such Fiscal Quarter, together with consolidated and consolidating statements
of earnings and cash flows 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, certified by a Senior Officer of the Company; and if either Agent
requests, (b) promptly when available and in any event within 30 days after the
end of each month, consolidated and consolidating balance sheets of the Company
and its Subsidiaries as of the end of such month, together with consolidated and
consolidating statements of earnings and a consolidated statement of cash flows
for such month and for the period beginning with the first day of such Fiscal
Year and ending on the last day of such month, certified by a Senior Officer of
the Company.
10.1.3 Compliance Certificates. Contemporaneously with the furnishing
of a copy of each annual audit report pursuant to Section 10.1.1 and each set of
quarterly statements pursuant to Section 10.1.2, a duly completed compliance
certificate in the form of Exhibit B, with appropriate insertions, dated the
date of such annual report or such quarterly statements and signed by a Senior
Officer of the Company, containing a computation of each of the financial ratios
and restrictions set forth in Section 11.14 and to the effect that such officer
has not become aware of any Event of Default or Default that has occurred and is
continuing or, if there is any such event, describing it and the steps, if any,
being taken to cure it.
10.1.4 Notice of Default, Litigation and ERISA Matters. Promptly upon
becoming aware of any of the following, written notice describing the same and
the steps being taken by the Company or the Subsidiary affected thereby with
respect thereto:
(a) the occurrence of an Event of Default or an Default;
(b) any litigation, arbitration or governmental
investigation or proceeding not previously disclosed by the Company to
the Lenders which has been instituted or, to the knowledge of the
Company, is threatened against any Loan Party or to which any of the
41
properties of any thereof is subject which might reasonably be expected
to have a Material Adverse Effect;
(c) the institution of any steps by any member of the
Controlled Group or any other Person to terminate any Pension Plan, or
the failure of any member of the Controlled Group 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 to any Multiemployer
Pension Plan, or the taking of any action with respect to a Pension
Plan which could result in the requirement that the Company 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 or
Multiemployer Pension Plan which could result in the incurrence by any
member of the Controlled Group of any material liability, fine or
penalty (including any claim or demand for withdrawal liability or
partial withdrawal from any Multiemployer Pension Plan), or any
material increase in the contingent liability of the Company with
respect to any post-retirement welfare benefit plan or other employee
benefit plan of the Company or another member of the Controlled Group,
or any notice that any Multiemployer Pension Plan is in reorganization,
that increased contributions may be required to avoid a reduction in
plan benefits or the imposition of an excise tax, that any such plan is
or has been funded at a rate less than that required under Section 412
of the Code, that any such plan is or may be terminated, or that any
such plan is or may become insolvent;
(d) any cancellation or material change in any insurance
maintained by any Loan Party; or
(e) any other event (including (i) any violation of any
Environmental Law or the assertion of any Environmental Claim or (ii)
the enactment or effectiveness of any law, rule or regulation) which
might reasonably be expected to have a Material Adverse Effect.
10.1.5 Borrowing Base Certificates. Within thirty (30) days of the
end of each Fiscal Quarter, a Borrowing Base Certificate dated as of the end of
such Fiscal Quarter and executed by a Senior Officer of the Company on behalf of
the Company (provided that (a) the Company shall deliver a Borrowing Base
Certificate within twenty-five (25) days after the end of each calendar month if
during such month the average daily balance of the Revolving Outstandings
exceeded $75,000,000; and (b) at any time an Event of Default exists, the
Administrative Agent may require the Company to deliver Borrowing Base
Certificates more frequently than quarterly).
10.1.6 Management Reports. Promptly upon receipt thereof, if
requested by either Agent and if not otherwise prohibited, copies of all
detailed financial and management reports submitted to the Company by
independent auditors in connection with each annual or interim audit made by
such auditors of the books of the Company.
10.1.7 Projections. As soon as practicable, and in any event not
later than 30 days after the commencement of each Fiscal Year, financial
projections for the Company and its
42
Subsidiaries for such Fiscal Year (including annual operating and cash flow
budgets) prepared in a manner consistent with the projections delivered by the
Company to the Lenders prior to the Closing Date or otherwise in a manner
reasonably satisfactory to the Administrative Agent, and such projections shall
have been prepared by the Company in good faith.
10.1.8 Subordinated Debt Notices. Promptly following receipt, copies
of any notices (including notices of default or acceleration) received from any
holder or trustee of, under or with respect to any Subordinated Debt.
10.1.9 Other Information. Promptly from time to time, such other
information concerning the Loan Parties as any Lender or the Administrative
Agent may reasonably request.
10.2 Books, Records and Inspections. Keep, and cause each other
Loan Party to keep, its books and records in accordance with sound business
practices sufficient to allow the preparation of financial statements in
accordance with GAAP; permit, and cause each other Loan Party to permit, any
Lender or the Administrative Agent or any representative thereof to inspect the
properties and operations of the Loan Parties; and permit, and cause each other
Loan Party to permit, at any reasonable time and with reasonable notice (or at
any time without notice if an Event of Default exists), any Lender or the
Administrative Agent or any representative thereof to visit any or all of its
offices, to discuss its financial matters with its officers and its independent
auditors (and after and as long as an Event of Default continues the Company
hereby authorizes such independent auditors to discuss such financial matters
with any Lender or the Administrative Agent or any representative thereof), and
to examine (and, at the expense of the Loan Parties, photocopy extracts from)
any of its books or other records; and permit, and cause each other Loan Party
to permit, the Administrative Agent and its representatives to inspect the
Inventory and other tangible assets of the Loan Parties, to perform appraisals
of the equipment of the Loan Parties, and to inspect, audit, check and make
copies of and extracts from the books, records, computer data, computer
programs, journals, orders, receipts, correspondence and other data relating to
Inventory, Accounts and any other collateral, all at the expense of the
Administrative Agent (except as set out in this Agreement). If an Event of
Default or Default exists, all such inspections or audits by the Administrative
Agent shall be at the Company's expense.
10.3 Maintenance of Property; Insurance. (a) Keep, and cause each
other Loan Party to keep, all property useful and necessary in the business of
the Loan Parties in normal working order and condition, ordinary wear and tear
excepted.
(b) Maintain, and cause each other Loan Party to maintain, with
responsible insurance companies acceptable to the Agents, such insurance
coverage as may be required by any law or governmental regulation or court
decree or order applicable to it and such other insurance, to such extent and
against such hazards and liabilities, as is customarily maintained by companies
similarly situated, but which shall insure against all risks and liabilities of
the type identified on Schedule 9.16 and shall have insured amounts no less
than, and deductibles no
43
higher than, those set forth on such schedule; and, upon request of the
Administrative Agent or any Lender, furnish to the Administrative Agent or such
Lender annually or upon any renewal of any policy a certificate setting forth in
reasonable detail the nature and extent of all insurance maintained by the Loan
Parties and delineating thereon the special provisions enumerated herein. The
Company shall cause each issuer of an insurance policy to provide the
Administrative Agent, for the benefit of any Lender, with an endorsement (i)
showing the Administrative Agent as additional insured and loss payee with
respect to each policy of property insurance and naming the Administrative Agent
and each Lender as an additional insured with respect to each policy of
liability insurance, (ii) providing that 30 days' notice will be given to the
Administrative Agent prior to any cancellation of, material reduction or change
in coverage provided by or other material modification to such policy, (iii)
providing breach of warranty coverage with respect to each policy of property
insurance, and (iv) providing a waiver of subrogation in favor of the
Administrative Agent and each Lender. The Company shall execute and deliver to
the Administrative Agent a collateral assignment, in form and substance
satisfactory to the Administrative Agent, of each business interruption
insurance policy maintained by the Company.
(c) UNLESS THE COMPANY PROVIDES THE ADMINISTRATIVE AGENT
WITH EVIDENCE OF THE INSURANCE COVERAGE CAPITAL REQUIRED BY THIS AGREEMENT, THE
ADMINISTRATIVE AGENT MAY PURCHASE INSURANCE AT THE COMPANY'S EXPENSE TO PROTECT
THE ADMINISTRATIVE AGENT'S AND THE LENDERS' INTERESTS IN THE COLLATERAL. THIS
INSURANCE MAY, BUT NEED NOT, PROTECT ANY LOAN PARTY'S INTERESTS. THE COVERAGE
THAT THE ADMINISTRATIVE AGENT PURCHASES MAY NOT PAY ANY CLAIM THAT IS MADE
AGAINST ANY LOAN PARTY IN CONNECTION WITH THE COLLATERAL. THE COMPANY MAY LATER
CANCEL ANY INSURANCE PURCHASED BY THE ADMINISTRATIVE AGENT, BUT ONLY AFTER
PROVIDING THE ADMINISTRATIVE AGENT WITH EVIDENCE THAT THE COMPANY HAS OBTAINED
INSURANCE AS REQUIRED BY THIS AGREEMENT. IF THE ADMINISTRATIVE AGENT PURCHASES
INSURANCE FOR THE COLLATERAL, THE COMPANY WILL BE RESPONSIBLE FOR THE COSTS OF
THAT INSURANCE, INCLUDING INTEREST AND ANY OTHER CHARGES THAT MAY BE IMPOSED
WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE
CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE MAY BE
ADDED TO THE PRINCIPAL AMOUNT OF THE LOANS OWING HEREUNDER. THE COSTS OF THE
INSURANCE MAY BE MORE THAN THE COST OF THE INSURANCE THE LOAN PARTIES MAY BE
ABLE TO OBTAIN ON THEIR OWN.
10.4 Compliance with Laws; Payment of Taxes and Liabilities. (a)
Comply, and cause each other Loan Party to comply, in all material respects with
all applicable laws, rules, regulations, decrees, orders, judgments, licenses
and permits, except where failure to comply could not reasonably be expected to
have a Material Adverse Effect; (b) without limiting clause (a) above, ensure,
and cause each other Loan Party to ensure, that no person who owns a
44
controlling interest in or otherwise controls a Loan Party is or shall be (i)
listed on the Specially Designated Nationals and Blocked Person List maintained
by the Office of Foreign Assets Control ("OFAC"), Department of the Treasury,
and/or any other similar lists maintained by OFAC pursuant to any authorizing
statute, Executive Order or regulation or (ii) a person designated under Section
1(b), (c) or (d) of Executive Order No. 13224 (September 23, 2001), any related
enabling legislation or any other similar Executive Orders, (c) without limiting
clause (a) above, comply, and cause each other Loan Party to comply, with all
applicable Bank Secrecy Act ("BSA") and anti-money laundering laws and
regulations and (d) pay, and cause each other Loan Party to pay, prior to
delinquency, all taxes and other governmental charges against it or any
collateral, as well as claims of any kind which, if unpaid, could become a Lien
on any of its property; provided that the foregoing shall not require any Loan
Party 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 in accordance with GAAP and, in the
case of a claim which could become a Lien on any collateral, such contest
proceedings shall stay the foreclosure of such Lien or the sale of any portion
of the collateral to satisfy such claim.
10.5 Maintenance of Existence, etc. Maintain and preserve, and
(subject to Section 11.5) cause each other Loan Party to maintain and preserve,
(a) its existence and good standing in the jurisdiction of its organization and
(b) its qualification to do business and good standing in each jurisdiction
where the nature of its business makes such qualification necessary (other than
such jurisdictions in which the failure to be qualified or in good standing
could not reasonably be expected to have a Material Adverse Effect).
10.6 Use of Proceeds. Use the proceeds of the Loans, and the
Letters of Credit, solely to pay in full the outstanding principal balance of
the Existing Term Loan, to retire the Subordinated Notes, to terminate the
revolving credit loan from LaSalle to facilitate the Company's issuance of the
Senior Convertible Notes, for working capital purposes, for Capital Expenditures
and for other general business 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 carrying" any Margin Stock.
10.7 Employee Benefit Plans.
(a) Unless and to the extent any Pension Plan is terminated,
maintain, and cause each other member of the Controlled Group to maintain, each
Pension Plan in substantial compliance with all applicable requirements of law
and regulations.
(b) Make, and cause each other member of the Controlled Group to
make, on a timely basis, all required contributions to any Multiemployer Pension
Plan.
(c) Without the Agents' prior consent, not to be unreasonably
withheld, not, and not permit any other member of the Controlled Group to (i)
seek a waiver of the minimum funding standards of ERISA, (ii) terminate or
withdraw from any Pension Plan or Multiemployer Pension
45
Plan or (iii) take any other action with respect to any Pension Plan that would
reasonably be expected to entitle the PBGC to terminate, impose liability in
respect of, or cause a trustee to be appointed to administer, any Pension Plan,
unless the actions or events described in clauses (i), (ii) and (iii)
individually or in the aggregate would not have a Material Adverse Effect.
(d) If any Person institutes steps to terminate a Pension Plan,
and as a result of such termination the Company or any member of the Controlled
Group could be required to make a contribution to such Pension Plan or otherwise
incur a liability to such Pension Plan, the Company shall promptly notify the
Agents.
10.8 Environmental Matters. If any release or threatened release or
other disposal of Hazardous Substances shall occur or shall have occurred on any
real property or any other assets of any Loan Party, the Company shall, or shall
cause the applicable Loan Party to, cause the prompt containment and removal of
such Hazardous Substances and the remediation of such real property or other
assets as necessary to comply with all Environmental Laws and to preserve the
value of such real property or other assets. Without limiting the generality of
the foregoing, the Company shall, and shall cause each other Loan Party to,
comply with any Federal or state judicial or administrative order requiring the
performance at any real property of any Loan Party of activities in response to
the release or threatened release of a Hazardous Substance. To the extent that
the transportation of Hazardous Substances is permitted by this Agreement, the
Company shall, and shall cause its Subsidiaries to, dispose of such Hazardous
Substances, or of any other wastes, only at licensed disposal facilities
operating in compliance with Environmental Laws.
10.9 Further Assurances. Take, and cause each other Loan Party to
take, such actions as are necessary or as the Administrative Agent or the
Required Lenders may reasonably request from time to time to ensure that the
Obligations of each Loan Party under the Loan Documents are secured by
substantially all of the assets of the Company and each Domestic Subsidiary as
well as all Capital Securities of each Domestic Subsidiary and guaranteed by
each Domestic Subsidiary (including, upon the acquisition or creation thereof,
any Subsidiary acquired or created after the Closing Date), in each case as the
Administrative Agent may determine, including (a) the execution and delivery of
guaranties, security agreements, pledge agreements, mortgages, deeds of trust,
financing statements and other documents, and the filing or recording of any of
the foregoing and (b) the delivery of certificated securities and other
collateral with respect to which perfection is obtained by possession. If the
Agents at any time have a reasonable basis to believe that there may be a
violation of any Environmental Laws by any Loan Party, on, at, in, under, above,
to, from or about any of its Mortgaged Real Property, which, in each case, could
reasonably be expected to have a Material Adverse Effect then each Loan Party,
with respect to such Mortgaged Real Property, upon the Agents' written respect
shall cause the performance of such environmental audits, including subsurface
sampling of soil and groundwater, and preparation of such environmental reports,
as the Company's expense, as the Agents and the Company may mutually agree, or,
if any Default or Event of Default then exists and is continuing, as the
environmental consulting firms reasonably acceptable to the Agents and shall be
in form and substance acceptable to the Agents.
46
10.10 Deposit Accounts. Unless the Administrative Agent otherwise
consents in writing, in order to facilitate the Administrative Agent's and the
Lenders' maintenance and monitoring of their security interests in the
collateral, maintain its and all of Domestic Subsidiaies' principal deposit
accounts with the Administrative Agent.
10.11 Intentionally omitted.
10.12 Syndication. Enter into such modifications to the Loan
Documents as the Agents may reasonably request as necessary for the syndication
of the Loans and the Commitments.
10.13 Appraisals. Each Loan Party shall, upon the Agents' written
request, (i) cause the performance of such appraisals of the Collateral
(excluding the Real Estate), at Lenders' expense (except with respect to the
initial appraisals and any appraisal undertaken after an Event of Default which
shall be at Company's expense), as Administrative Agent may from time to time
reasonably request, which shall be conducted by reputable firms reasonably
acceptable to Administrative Agent and shall be in form and substance acceptable
to Administrative Agent, and (ii) permit Administrative Agent or its
representatives to have access to all Real Estate for the purpose of conducting
such appraisals as Administrative Agent deems appropriate; provided that if an
Event of Default shall not have occurred, Administrative Agent shall request
such appraisals no more frequently than once annually from and after the Closing
Date. Obligors shall reimburse Administrative Agent for the costs of such
appraisals for which they are responsible, and the same will constitute a part
of the Obligations secured hereunder. Administrative Agent agrees to use
reasonable efforts to limit the costs of such appraisals to not more than
$75,000 per year without limiting the scope of any such appraisal. Agent agrees
to notify Company if any such appraisal exceeds or is anticipated to exceed such
amount.
10.14 Subsidiaries' Assets. Not permit any Subsidiaries other than a
Foreign Subsidiary or a Domestic Subsidiary to own assets having an aggregate
book value which is greater than 115% of that aggregate amount expressed in
Schedule 9.24.
10.15 Escrow. All payment Assignments made by the Obligors to the
Administrative Agent pursuant to the Assignment of Claims Act of 1940, all
Pledged Equity (as defined in the Collateral and Guaranty Agreement among
parties hereto dated as of July 23, 2004) and stock powers relating thereto, and
all Suborination Agreements shall be delivered to that law firm located in
Chicago, Illinois selected by the Company ("Escrowee"). If the Administrative
Agent notifies the Company and Escrowee that an Event of Default has occurred
Escrowee shall immediately deliver all such Assignments, Pledged Equity and
stock powers and Subordination Agreements to the Administrative Agent, who shall
than be free to take all measures with respect to all such items as it deems
desirable for the Lenders' benefit pursuant to this Agreement.
SECTION 11 NEGATIVE COVENANTS
Until the expiration or termination of the Commitments and thereafter
until all Obligations hereunder and under the other Loan Documents are paid in
full and all Letters of
47
Credit have been terminated, the Company agrees that, unless at any time the
Required Lenders shall otherwise expressly consent in writing, it will:
11.1 Debt. Not, and not permit any other Loan Party to, create,
incur, guaranty, assume or suffer to exist any Debt, except:
(a) Obligations under this Agreement and the other Loan
Documents;
(b) Debt secured by Liens permitted by Section 11.2(d),
and extensions, renewals and refinancings thereof; provided that the
aggregate amount of all such Debt at any time outstanding shall not
exceed $3,000,000.00;
(c) Debt of the Company to any Domestic Subsidiary or
Debt of any Domestic Subsidiary to the Company or another Domestic
Subsidiary; provided that such Debt shall be evidenced by a demand note
in form and substance reasonably satisfactory to the Administrative
Agent and pledged and delivered to the Administrative Agent pursuant to
the Collateral Documents as additional collateral security for the
Obligations, and the obligations under such demand note shall be
subordinated to the Obligations of the Company hereunder in a manner
reasonably satisfactory to the Administrative Agent;
(d) Subordinated Debt;
(e) Hedging Obligations approved by Administrative Agent
and incurred in favor of a Lender or an Affiliate thereof for bona fide
hedging purposes and not for speculation;
(f) Debt described on Schedule 11.1 and any extension,
renewal or refinancing thereof so long as the principal amount thereof
is not increased nor the amortization thereof is not decreased;
(g) Unfunded pension fund and other employee benefit plan
obligations and liabilities to the extent they are permitted to remain
unfunded under applicable law;
(h) Debt in respect of Taxes, assessments, governmental
charges or levies and claims for labor, materials, and supplies to the
extent payment thereof shall not at the time be required by Section
10.4.
(i) Contingent Liabilities arising with respect to
customary indemnification obligations in favor of sellers in connection
with Acquisitions permitted under Section 11.5 and purchasers in
connection with dispositions permitted under Section 11.5; and
(j) other unsecured subordinated Debt, in addition to the
Debt listed above, in an aggregate outstanding amount not at any time
exceeding $3,000,000.00.
48
11.2 Liens. Not, and not permit any other Loan Party 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 securing obligations not
exceeding in the aggregate $3,000,000.00 at any time and (ii) Liens in
the form of deposits or pledges 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 bonds, bids, performance bonds and similar obligations) for sums
not overdue or being contested in good faith by appropriate proceedings
and not involving any advances or borrowed money or the deferred
purchase price of property or services and, in each case, for which it
maintains adequate reserves;
(c) Liens described on Schedule 11.2 as of the Closing
Date;
(d) subject to the limitation set forth in Section
11.1(b), (i) Liens arising in connection with Capital Leases (and
attaching only to the property being leased), (ii) Liens existing on
property at the time of the acquisition thereof by any Loan Party (and
not created in contemplation of such acquisition) and (iii) Liens that
constitute purchase money security interests on any property securing
debt incurred for the purpose of financing all or any part of the cost
of acquiring such property, provided that any such Lien attaches to
such property within 20 days of the acquisition thereof and attaches
solely to the property so acquired;
(e) attachments, appeal bonds, judgments and other
similar Liens, which would not be reasonably expected to result in a
Material Adverse Effect 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;
(f) easements, rights of way, restrictions, minor defects
or irregularities in title and other similar Liens not interfering in
any material respect with the ordinary conduct of the business of any
Loan Party;
(g) Liens arising under the Loan Documents; and
(h) the replacement, extension or renewal of any Lien
permitted by clause (c) above upon or in the same property subject
thereto arising out of the extension, renewal or replacement of the
Debt secured thereby (without increase in the amount thereof).
49
11.3 Operating Leases. Not permit the aggregate amount of all
rental payments under Operating Leases made (or scheduled to be made) by the
Loan Parties (on a consolidated basis) to exceed $6,000,000 in any Fiscal Year,
except in any Fiscal Year when prepayment described in Section 11.4(e)(vi) may
occur.
11.4 Restricted Payments. Not, and not permit any other Loan Party
to, (a) make any distribution to any holders of its Capital Securities, (b)
purchase or redeem any of its Capital Securities in excess of $1,000,000
aggregate in any Fiscal Year, (c) pay any management fees or similar fees to any
of its equityholders or any Affiliate thereof, (d) make any redemption,
prepayment, defeasance, repurchase or any other payment in respect of any
Subordinated Debt (other than a Debt secured by a Permitted Lien if the asset
securing such Debt is sold in accordance with Section 11.5), or (e) set aside
funds for any of the foregoing. Notwithstanding the foregoing, (i) any
Subsidiary may pay dividends or make other distributions to the Company or to a
Domestic Subsidiary; (ii) the Company may make regularly scheduled payments of
interest in respect of Subordinated Debt to the extent permitted under the
subordination provisions thereof; (iii) the Company may pay in whole or in part
any IRB or Subordinated Notes at any time; (iv) the Company may pay a cash
dividend in any Fiscal Quarter of not more than $500,000 in the aggregate; (v)
the Company may pay directors' fees and reimbursable expenses; and (vi) the
Company may prepay its obligations pursuant to its lease of property located in
Brownsville, Texas and its lease of the aircraft currently used by the Company.
11.5 Mergers, Consolidations, Sales. Not, and not permit any other
Loan Party to, (a) create any Subsidiary; (b) without the Agents' prior written
consent, not to be unreasonably withheld, to consummate any merger or
consolidation, or purchase or otherwise acquire all or substantially all of the
assets or any Capital Securities of any class of, or any partnership or joint
venture interest in, any other Person, (c) sell, transfer, convey or lease all
or any substantial part of its assets or Capital Securities (including the sale
of Capital Securities of any Subsidiary) except for sales of Inventory in the
ordinary course of business or as otherwise allowed in this Agreement, or (d)
sell or assign with or without recourse any receivables. Notwithstanding the
foregoing, the following shall be permitted: (i) with Required Lenders' prior
written consent (such consent not to be unreasonably withheld) the sale,
transfer, conveyance or other disposition by a Loan Party of machinery and
equipment during the term of this Agreement having an Orderly Liquidation Value
not exceeding $50,000,000 in the aggregate, provided however, no disposition may
occur if and to the extent that any such contemplated disposition is for a cash
amount which is less than the Orderly Liquidation Value of any such asset; (ii)
transfers between Obligors provided that the Agents maintain a first priority
perfected security interest in the asset transferred; (iii) sales of the Capital
Securities of any Foreign Subsidiary; and (iv) the sale, transfer, conveyance or
other disposition by a Loan Party of equipment or fixtures that are obsolete or
no longer used or useful in such Loan Party's business and having a value not
exceeding $3,000,000 in the aggregate in any Fiscal Year, provided such
equipment or fixtures is replaced by equipment or fixtures of comparable value
or worth and provided further that Agents maintain a first priority perfected
security interest in the replacement equipment or fixtures. With respect to any
disposition of assets or other properties permitted pursuant to clause (i)
above, Agents agree, upon reasonable prior written notice, to release the Lien
on such assets or other
50
properties in order to permit the applicable Loan Party to effect such
disposition and shall execute and deliver to Company at Company's expense,
appropriate UCC-3 termination statements and other releases as reasonably
requested by Company.
11.6 Modification of Organizational Documents. Not permit the
charter, by-laws or other organizational documents of any Loan Party to be
amended or modified in any way which could reasonably be expected to materially
adversely affect the interests of the Lenders.
11.7 Transactions with Affiliates. Not, and not permit any other
Loan Party to, enter into, or cause, suffer or permit to exist any transaction,
arrangement or contract with any of its other Affiliates (other than the Loan
Parties) other than in the ordinary course of business and which is on fair and
reasonable terms which are no less favorable than are obtainable from any Person
which is not one of its Affiliates. In addition, if any such transaction or
series of related transactions involves payments in excess of $1,000,000 in the
aggregate, the terms of these transactions if not previously disclosed in
Schedule 11.7 must be disclosed in advance to Agents. All such transactions
existing as of the date hereof are described on Schedule 11.7. No Loan Party
shall enter into any lending or borrowing transaction with any employees of any
Loan Party, except loans to their respective employees on an arm's-length basis
in the ordinary course of business consistent with past practices for travel
expenses, relocation costs and similar purposes and stock option financing up to
a maximum of $250,000 in the aggregate at any one time outstanding.
11.8 Unconditional Purchase Obligations. Not, and not permit any
other Loan Party to, enter into or be a party to any contract for the purchase
of materials, supplies or other property or services if such contract requires
that payment be made by it regardless of whether delivery is ever made of such
materials, supplies or other property or services, which is outside of the
ordinary course of business and inconsistent with past practices.
11.9 Inconsistent Agreements. Not, and not permit any other Loan
Party to, enter into any agreement containing any provision which would (a) be
violated or breached by any borrowing by the Company hereunder or by the
performance by any Loan Party of any of its Obligations hereunder or under any
other Loan Document, (b) prohibit any Loan Party from granting to the
Administrative Agent and the Lenders, a Lien on any of its assets or (c) create
or permit to exist or become effective any encumbrance or restriction on the
ability of any Subsidiary to (i) pay dividends or make other distributions to
the Company or any other Subsidiary, or pay any Debt owed to the Company or any
other Subsidiary, (ii) make loans or advances to any Loan Party or (iii)
transfer any of its assets or properties to any Loan Party, other than (A)
customary restrictions and conditions contained in agreements relating to the
sale of all or a substantial part of the assets of any Subsidiary pending such
sale, provided that such restrictions and conditions apply only to the
Subsidiary to be sold and such sale is permitted hereunder (B) restrictions or
conditions imposed by any agreement relating to purchase money Debt, Capital
Leases and other secured Debt permitted by this Agreement if such restrictions
or conditions apply only to the property or assets securing such Debt and (C)
customary provisions in leases and other contracts restricting the assignment
thereof.
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11.10 Business Activities; Issuance of Equity. Not, and not permit
any other Loan Party to, engage in any line of business other than the
businesses engaged on the date hereof and businesses reasonably related thereto
and shall not and not permit any other Loan Party to change its business
objectives, purposes or operations if such activities could in any way adversely
effect the repayment of the Loans or any other Debt or could reasonably be
expected to result in a Material Adverse Effect. Not, and not permit any other
Loan Party to, issue any Capital Securities other than (a) any issuance of
shares of the Company's common Capital Securities pursuant to any employee or
director option program, benefit plan or compensation program, (b) any issuance
by a Subsidiary to the Company or another Subsidiary in accordance with Section
11.4, (c) the issuance of any other Capital Securities as set out in this
Agreement (e.g. the Senior Convertible Notes conversion to common Capital
Securities); or (d) for a merger or acquisition with the prior written consent
of the Agents, which shall not be unreasonably withheld.
11.11 Investments. Except as otherwise expressly permitted by this
Section 11, no Loan Party shall make or permit to exist any Investment in, any
Person, except that (a) Obligors may hold investments comprised of notes
payable, or stock or other securities issued by Account Debtors to any Obligor
pursuant to negotiated agreements with respect to settlement of such Account
Debtor's Accounts in the ordinary course of business, so long as Obligors
deliver physical possession of such note payable, stock or other security to
Collateral Agent along with all endorsements and stock powers requested by
Collateral Agent with respect to any such note payable, stock or security that
exceeds $100,000; (b) each Loan Party may maintain its existing investments in
its Subsidiaries and in Titan Europe Plc as of the Closing Date; (c) the Company
may maintain the IRB collateral; (d) so long as no Unmatured Event of Default or
Event of Default shall have occurred and be continuing, Obligors may invest (x)
up to $500,000 in the aggregate at any time in which any Revolving Loans are
outstanding, or (y) the Obligors' available unrestricted cash balances at any
time in which no Revolving Loans are outstanding, subject to a perfected
security interest in such investment in favor of Agents, (i) marketable direct
obligations issued or unconditionally guaranteed by the United States of America
or any agency thereof maturing within one year from the date of acquisition
thereof, (ii) commercial paper maturing no more than one year from the date of
creation thereof and currently having the highest rating obtainable from either
Standard & Poor's Ratings Group or Xxxxx'x Investors Service, Inc., (iii)
certificates of deposit, maturing no more than one year from the date of
creation thereof, issued by commercial banks incorporated under the laws of the
United States of America, each having combined capital, surplus and undivided
profits of not less than $200,000,000 and having a senior unsecured rating of
"A" or better by a nationally recognized rating agency (an "A Rated Bank"), (iv)
time deposits, maturing no more than 30 days from the date of creation thereof
with A Rated Banks and (v) mutual funds that invest solely in one or more of the
investments described in clauses (i) through (iv) above; and (e) Obligors may
hold notes payable or other indebtedness from any Foreign Subsidiary of any Loan
Party, provided that (A) each such Foreign Subsidiary shall have executed and
delivered to each such Obligor, a demand note (collectively, the "Intercompany
Notes") to evidence any such intercompany Indebtedness owing at any time by such
Foreign Subsidiary to such Obligor, which Intercompany Notes shall be in form
and substance satisfactory to Agents and shall be pledged
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and delivered to Administrative Agent pursuant to a pledge agreement or security
agreement in form and content satisfactory to Agents in their sole discretion as
additional collateral security for the Obligations, (B) each Loan Party shall
record all intercompany transactions on its books and records in a manner
consistent with past practices, (C) at the time any such intercompany loan or
advance is made by any Obligor to any Foreign Subsidiary and after giving effect
thereto, each such Obligor shall be Solvent, (D) no Default or Default or Event
of Default exists or would occur and be continuing after giving effect to any
such proposed intercompany loan, (E) the recipient of such intercompany loans
shall be creditworthy as determined by Agent, and (F) such intercompany loans do
not exceed at any time, in the aggregate, the sum of $5,000,000.
11.12 Restriction of Amendments to Certain Documents. Not amend or
otherwise modify, or waive any rights under, the Subordinated Notes, IRB, the
Foreign Affiliate Loan, or Senior Convertible Notes if, in any case, such
amendment, modification or waiver could be adverse to the interests of the
Lenders.
11.13 Fiscal Year. Not change its Fiscal Year.
11.14 Financial Covenants.
11.14.1 Minimum Book Value. Not permit the aggregate book value of
Eligible Accounts and Eligible Inventory to be less than $75,000,000 at any
time.
11.14.2 Fixed Charge Coverage Ratio. In the event the average daily
balance of the Revolving Outstandings exceed $75,000,000 during any 30 day
period ending during any Fiscal Quarter, not permit the Fixed Charge Coverage
Ratio for the Computation Period ending on the last day of such Fiscal Quarter
to be less than 1.0 to 1.0.
11.14.3 Collateral Coverage. Not permit (a) the sum of the Borrowing
Base, plus the unrestricted cash of all Obligors; divided by (b) the Revolving
Outstandings, to be less than one and one-half (1.50).
11.15 Cancellation of Debt. Not, and not permit any other Loan Party
to, cancel any claim or debt owing to it, except for reasonable consideration
negotiated on an arms-length basis and in the ordinary course of business
consistent with past practices and customary write downs and charge offs for bad
debts consistent with past practices.
11.16 ERISA. No Loan Party shall cause or permit to occur an event
which could result in the imposition of a Lien under Section 412 of the IRC or
Section 302 or 4068 of ERISA or cause or permit to occur an Termination Event to
the extent such Termination Event could reasonably be expected to have a
Material Adverse Effect.
11.17 Inventory. Not permit Inventory having an aggregate book value
exceeding Fifteen Million and No/100 Dollars ($15,000,000.00) at any time to be
in a location or locations other than the Mortgaged Real Property and that
facility currently acquired by Titan Wheel Corporation of Virginia as its
principal place of business.
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SECTION 12 EFFECTIVENESS; CONDITIONS OF LENDING, ETC.
The obligation of each Lender to make its Loans and of the Issuing
Lender to issue Letters of Credit is subject to the following conditions
precedent:
12.1 Initial Credit Extension. The obligation of the Lenders to
make the initial Loans and the obligation of the Issuing Lender to issue its
initial Letter of Credit (whichever first occurs) is, in addition to the
conditions precedent specified in Section 12.2, subject to the condition
precedent that (i) the Existing Term Loans have been (or concurrently with the
initial borrowing hereunder will be) paid in full, and that all agreements and
instruments governing the Existing Term Loan and that all Liens securing such
Existing Term Loan have been (or within 30 days after Closing will be)
terminated and (b) the Administrative Agent shall have received all of the
following, each duly executed and dated the Closing Date (or such earlier date
as shall be satisfactory to the Administrative Agent), in form and substance
satisfactory to the Administrative Agent (and the date on which all such
conditions precedent have been satisfied or waived in writing by the
Administrative Agent and the Lenders is called the "Closing Date"):
12.1.1 Notes. A Note for each Lender.
12.1.2 Authorization Documents. For each Loan Party, such Person's
(a) charter (or similar formation document), certified by the secretary of each
Loan Party; (b) good standing certificates in its state of incorporation (or
formation) and in each other state requested by the Administrative Agent; (c)
bylaws (or similar governing document); (d) resolutions of its board of
directors (or similar governing body) approving and authorizing such Person's
execution, delivery and performance of the Loan Documents to which it is party
and the transactions contemplated thereby; and (e) signature and incumbency
certificates of its officers executing any of the Loan Documents (it being
understood that the Administrative Agent and each Lender may conclusively rely
on each such certificate until formally advised by a like certificate of any
changes therein), all certified by its secretary or an assistant secretary (or
similar officer) as being in full force and effect without modification.
12.1.3 Consents, etc. Certified copies of all documents evidencing
any necessary corporate or partnership action, consents and governmental
approvals (if any) required for the execution, delivery and performance by the
Loan Parties of the documents referred to in this Section 12.
12.1.4 Letter of Direction. A letter of direction containing funds
flow information with respect to the proceeds of the Loans on the Closing Date.
12.1.5 Guaranty and Collateral Agreement. A counterpart of the
Guaranty and Collateral Agreement executed by each Loan Party, together with all
instruments, transfer powers and other items required to be delivered in
connection therewith.
12.1.6 Intentionally omitted.
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12.1.7 Real Estate Documents. With respect to each parcel of
Mortgaged Real Property, a duly executed Mortgage providing for a fully
perfected Lien, in favor of the Agents for the benefit of the Lenders, in all
right, title and interest of the Company or such Domestic Subsidiary in such
Mortgaged Real Property, together with:
(a) an ALTA Loan Title Insurance Policy, issued by an
insurer acceptable to the Agents, insuring the Lenders' Lien on such
Mortgaged Real Property and containing such endorsements as the Agents
may reasonably require;
(b) copies of all documents of record concerning such
Mortgaged Real Property as shown on the commitment for the ALTA Loan
Title Insurance Policy referred to above;
(c) original or certified copies of all insurance
policies required to be maintained with respect to such Mortgaged Real
Property by this Agreement, the applicable Mortgage or any other Loan
Document;
(d) a survey certified to the Agents for the benefit of
the Lenders meeting such standards as the Agents may reasonably
establish and otherwise reasonably satisfactory to the Agents;
(e) a flood insurance policy concerning such Mortgaged
Real Property, if required by the Flood Disaster Protection Act of
1973; and
(f) an Environmental Indemnity for each Mortgaged Real
Property.
12.1.8 Appraisal. An appraisal of all Equipment with the results
thereof satisfactory to Agents in their reasonable discretion.
12.1.9 Opinions of Counsel. Opinions of counsel for each Obligor,
including local counsel reasonably requested by the Administrative Agent,
covering the laws of the states of Iowa and Illinois.
12.1.10 Insurance. Evidence of the existence of insurance required to
be maintained pursuant to Section 10.3(b), together with evidence that the
Administrative Agent has been named as a lender's loss payee and an additional
insured on all related insurance policies.
12.1.11 Subordination. A duly executed subordination letter with
respect to the Foreign Affiliate Loan.
12.1.12 Payment of Fees. Evidence of payment by the Company of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with all Attorney Costs of the Agents to the
extent invoiced prior to the Closing Date, plus such additional amounts of
Attorney Costs as shall constitute the Agents' reasonable estimate of Attorney
Costs incurred or to be incurred by the Agents through the closing proceedings
55
(provided that such estimate shall not thereafter preclude final settling of
accounts between the Company and the Agents).
12.1.13 Intentionally omitted.
12.1.14 Pro Forma. A consolidated pro forma balance sheet of the
Company as at the Closing Date, adjusted to give effect to the financings
contemplated hereby as if such transactions had occurred on such date,
consistent in all material respects with the sources and uses of cash as
previously described to the Lenders and the forecasts previously provided to the
Lenders.
12.1.15 Intentionally omitted.
12.1.16 Search Results; Lien Terminations. Certified copies of Uniform
Commercial Code search reports dated a date reasonably near to the Closing Date,
listing all effective financing statements which name any Obligor (under their
present names and any previous names) as debtors, together with (a) copies of
such financing statements, (b) payoff letters evidencing repayment in full of
Existing Term Loan, the termination of all agreements relating thereto and the
release of all Liens granted in connection therewith, with Uniform Commercial
Code or other appropriate termination statements and documents effective to
evidence the foregoing (other than Liens permitted by Section 11.2) and (c) such
other Uniform Commercial Code termination statements as the Administrative Agent
may reasonably request.
12.1.17 Filings, Registrations and Recordings. The Administrative
Agent shall have received each document (including Uniform Commercial Code
financing statements) required by the Collateral Documents or under law or
reasonably requested by the Administrative Agent to be filed, registered or
recorded in order to create in favor of the Administrative Agent, for the
benefit of the Lenders, a perfected Lien on the collateral described therein,
prior to any other Liens (subject only to Liens permitted pursuant to Section
11.2), in proper form for filing, registration or recording.
12.1.18 Borrowing Base Certificate. A Borrowing Base Certificate with
an effective date as of the end of the most recently completed Fiscal Quarter.
12.1.19 Closing Certificate, Consents and Permits. A certificate
executed by an officer of the Company on behalf of the Company certifying (a)
the matters set forth in Section 12.2.1 as of the Closing Date.
12.1.20 Other. Such other documents as any Agent or any Lender may
reasonably request.
12.2 Conditions. The obligation (a) of each Lender to make each
Loan and (b) of the Issuing Lender to issue each Letter of Credit is subject to
the following further conditions precedent that:
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12.2.1 Compliance with Warranties, No Default, etc. Both before and
after giving effect to any borrowing and the issuance of any Letter of Credit,
the following statements shall be true and correct:
(a) the representations and warranties of each Loan Party
set forth in this Agreement and the other Loan Documents shall be true
and correct in all respects with the same effect as if then made
(except to the extent stated to relate to a specific earlier date, in
which case such representations and warranties shall be true and
correct as of such earlier date); and
(b) no Event of Default or Default shall have then
occurred and be continuing.
12.2.2 Confirmatory Certificate. If requested by the Administrative
Agent or any Lender, the Administrative Agent shall have received a certificate
dated the date of such requested Loan or Letter of Credit and signed by a duly
authorized representative of the Company as to the matters set out in Section
12.2.1 (it being understood that each request by the Company for the making of a
Loan or the issuance of a Letter of Credit shall be deemed to constitute a
representation and warranty by the Company that the conditions precedent set
forth in Section 12.2.1 will be satisfied at the time of the making of such Loan
or the issuance of such Letter of Credit), together with such other documents as
the Administrative Agent or any Lender may reasonably request in support
thereof.
SECTION 13 EVENTS OF DEFAULT AND THEIR EFFECT.
13.1 Events of Default. Each of the following shall constitute an
Event of Default under this Agreement:
13.1.1 Non-Payment of the Loans, etc. Default in the payment when due
of the principal of any Loan; or default, and continuance thereof for five days,
in the payment when due of any interest, fee, reimbursement obligation with
respect to any Letter of Credit or other amount payable by the Company hereunder
or under any other Loan Document.
13.1.2 Non-Payment of Other Debt. Any default shall occur which is
not cured within any applicable cure period under the terms applicable to any
Debt of any Loan Party in an aggregate amount (for all such Debt so affected and
including undrawn committed or available amounts and amounts owing to all
creditors under any combined or syndicated credit arrangement) exceeding Ten
Million and No/100 Dollars ($10,000,000.00) and such default shall (a) consist
of the failure to pay such Debt when due, whether by acceleration or otherwise,
or (b) accelerate the maturity of such Debt or permit the holder or holders
thereof, or any trustee or agent for such holder or holders, to cause such Debt
to become due and payable (or require any Loan Party to purchase or redeem such
Debt or post cash collateral in respect thereof) prior to its expressed
maturity.
13.1.3 Other Material Obligations. Default which is not cured within
any applicable cure period in the payment when due, or in the performance or
observance of, any material
57
obligation of, or condition agreed to by, any Loan Party with respect to any
material purchase or lease of goods or services where such default, singly or in
the aggregate with all other such defaults, might reasonably be expected to have
a Material Adverse Effect.
13.1.4 Bankruptcy, Insolvency, etc. Any Loan Party becomes insolvent
or generally fails to pay, or admits in writing its inability or refusal to pay,
debts as they become due; or any Loan Party applies for, consents to, or
acquiesces in the appointment of a trustee, receiver or other custodian for such
Loan Party 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 any Loan
Party or for a substantial part of the property of any thereof and is not
discharged within 60 days; or any bankruptcy, reorganization, debt arrangement,
or other case or proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding, is commenced in respect of any Loan
Party, and if such case or proceeding is not commenced by such Loan Party, it is
consented to or acquiesced in by such Loan Party, or remains for 60 days
undismissed; or any Loan Party takes any action to authorize, or in furtherance
of, any of the foregoing.
13.1.5 Non-Compliance with Loan Documents. (a) Failure by any Loan
Party to comply with or to perform any covenant set forth in Section 10.1.5,
10.3(b),10.5 or 10.6 or Section 11; or (b) failure by any Loan Party to comply
with or to perform any other provision of this Agreement or any other Loan
Document (and not constituting an Event of Default under any other provision of
this Section 13) and continuance of such failure described in this clause (b)
for 30 days.
13.1.6 Representations; Warranties. Any representation or warranty
made by any Loan Party herein or any other 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 any Loan Party to the
Administrative Agent or any Lender in connection herewith is false or misleading
in any material respect on the date as of which the facts therein set forth are
stated or certified.
13.1.7 Pension Plans. (a) any Loan Party does not materially comply
with ERISA and all other federal and local laws concerning benefit plans, or (b)
there shall occur any withdrawal or partial withdrawal from a Multiemployer
Pension Plan and the withdrawal liability (without unaccrued interest) to
Multiemployer Pension Plans as a result of such withdrawal (including any
outstanding withdrawal liability that the Company or any member of the
Controlled Group have incurred on the date of such withdrawal) is material.
13.1.8 Judgments. Final judgments which could result in a Material
Adverse Effect rendered against any Loan Party and shall not have been paid,
discharged or vacated or had execution thereof stayed pending appeal within 90
days after entry or filing of such judgments, provided that the Party is
diligently pursuing post-judgment relief.
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13.1.9 Invalidity of Collateral Documents, etc. Any Collateral
Document shall cease to be in full force and effect; or any Loan Party (or any
Person by, through or on behalf of any Loan Party) shall contest in any manner
the validity, binding nature or enforceability of any Collateral Document.
13.1.10 Invalidity of Subordination Provisions, etc. Any subordination
provision in any document or instrument governing Subordinated Debt, or any
subordination provision in any guaranty by any Subsidiary of any Subordinated
Debt, shall cease to be in full force and effect, or any Loan Party or any other
Person (including the holder of any applicable Subordinated Debt) shall contest
in any manner the validity, binding nature or enforceability of any such
provision.
13.1.11 Change of Control. A Change of Control shall occur.
13.1.12 Material Adverse Effect. The occurrence of any event having a
Material Adverse Effect, as reasonably determined by the Agents.
13.1.13 Cross Default. Any default or breach by any Obligor shall
occur and be continuing under any agreement, including without limitation, any
security agreement, pledge agreement, credit agreement or loan agreement, any
note, loan or lease, including without limitation, any personal property lease,
real property lease, synthetic lease or aircraft lease, or any credit facility
with or in favor of GE Capital, either individually, or as agent for others, and
any modification, extension, amendment or restatement of any of the foregoing.
13.2 Effect of Event of Default. If any Event of Default described
in Section 13.1.4 shall occur in respect of the Company, the Commitments shall
immediately terminate and the Loans and all other Obligations hereunder shall
become immediately due and payable and the Company shall become immediately
obligated to Cash Collateralize all Letters of Credit, all without presentment,
demand, protest or notice of any kind; and, if any other Event of Default shall
occur and be continuing, the Agents may (and, upon the written request of the
Required Lenders shall) declare the Commitments to be terminated in whole or in
part and/or declare all or any part of the Loans and all other Obligations
hereunder to be due and payable and/or demand that the Company immediately Cash
Collateralize all or any Letters of Credit, whereupon the Commitments shall
immediately terminate (or be reduced, as applicable) and/or the Loans and other
Obligations hereunder shall become immediately due and payable (in whole or in
part, as applicable) and/or the Company shall immediately become obligated to
Cash Collateralize the Letters of Credit (all or any, as applicable), all
without presentment, demand, protest or notice of any kind. The Administrative
Agent shall promptly advise the Company of any such declaration, but failure to
do so shall not impair the effect of such declaration. Any cash collateral
delivered hereunder shall be held by the Administrative Agent (without liability
for interest thereon) and applied to the Obligations arising in connection with
any drawing under a Letter of Credit. After the expiration or termination of all
Letters of Credit, such cash collateral shall be applied by the Administrative
Agent to any remaining Obligations hereunder and any excess shall be delivered
to the Company or as a court of competent jurisdiction may elect. During the
existence of any
59
Event of Default or Default the Agents shall specifically be permitted to
communicate directly with the Company's certified public accountants and Company
hereby authorizes and instructs those accountants to disclose such financial
information as Agents shall request.
SECTION 14 THE AGENTS.
14.1 Appointment and Authorization. Each Lender hereby irrevocably
(subject to Section 14.10) appoints, designates and authorizes the Agents 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 Agents shall not have any duty or
responsibility except those expressly set forth herein, nor shall the Agents
have or be deemed to have any fiduciary relationship with any Lender or
participant, 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 Agents. Without limiting the generality
of the foregoing sentence, the use of the term "agent" herein and in other Loan
Documents with reference to the 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.
14.2 Issuing Lender. The Issuing Lender shall act on behalf of the
Lenders (according to their Pro Rata Shares) with respect to any Letters of
Credit issued by it and the documents associated therewith. The Issuing Lender
shall have all of the benefits and immunities (a) provided to the Administrative
Agent in this Section 14 with respect to any acts taken or omissions suffered by
the Issuing Lender in connection with Letters of Credit issued by it or proposed
to be issued by it and the applications and agreements for letters of credit
pertaining to such Letters of Credit as fully as if the term "Administrative
Agent", as used in this Section 14, included the Issuing Lender with respect to
such acts or omissions and (b) as additionally provided in this Agreement with
respect to the Issuing Lender.
14.3 Delegation of Duties. The Administrative Agent or Co-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 and other consultants or experts concerning all matters pertaining to
such duties. The Administrative Agent or Co-Agent shall not be responsible for
the negligence or misconduct of any agent or attorney-in-fact that it selects in
the absence of gross negligence or willful misconduct. Any decision to foreclose
a Mortgaged Real Property shall require the consent of both Agents.
14.4 Exculpation of Agents. None of the Agents nor any of their
directors, officers, employees or agents shall (a) 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
60
contemplated hereby (except to the extent resulting from their own gross
negligence or willful misconduct in connection with its duties expressly set
forth herein as determined by a final, nonappealable judgment by a court of
competent jurisdiction), or (b) be responsible in any manner to any Lender or
participant for any recital, statement, representation or warranty made by any
Loan Party or Affiliate of the Company, or any officer thereof, contained in
this Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
any 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 the creation,
perfection or priority of any Lien or security interest therein), or for any
failure of the Company or any other party to any Loan Document to perform its
Obligations hereunder or thereunder. The Agents shall not be under any
obligation to any Lender 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 Company or any of the Company's Subsidiaries or Affiliates.
14.5 Reliance by Agents. The Agents shall be entitled to rely, and
shall be fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, electronic mail
message, 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
Company), independent accountants and other experts selected by the Agents. The
Agents 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 Lenders as it deems appropriate and, if it
so requests, confirmation from the Lenders of their obligation to indemnify the
Agents 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 Agents 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 Lenders and such request and any action taken or failure to act
pursuant thereto shall be binding upon each Lender. For purposes of determining
compliance with the conditions specified in Section 12, each Lender that has
signed this Agreement shall be deemed to have consented to, approved or accepted
or to be satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender unless the
Agents shall have received written notice from such Lender prior to the proposed
Closing Date specifying its objection thereto.
14.6 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Event of Default or
Default except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Agents for the account of the Lenders,
unless the Agents shall have received written notice from a Lender or the
Company referring to this Agreement, describing such Event of Default or Default
and stating that such notice is a "notice of default". The Agents will notify
the Lenders of its receipt of any such notice. The Agents shall take such action
with respect to such Event of Default or Default
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as may be requested by the Required Lenders in accordance with Section 13;
provided that unless and until the Agents have received any such request, the
Agents may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Event of Default or Default as it shall
deem advisable or in the best interest of the Lenders.
14.7 Credit Decision. Each Lender acknowledges that the Agents has
not made any representation or warranty to it, and that no act by the Agents
hereafter taken, including any consent and acceptance of any assignment or
review of the affairs of the Loan Parties, shall be deemed to constitute any
representation or warranty by the Agents to any Lender as to any matter,
including whether the Agents have disclosed material information in their
possession. Each Lender represents to the Agents that it has, independently and
without reliance upon the Agents 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 Loan Parties, and made its own decision to enter into
this Agreement and to extend credit to the Company hereunder. Each Lender also
represents that it will, independently and without reliance upon the Agents 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 Company. Except for notices, reports and other documents
expressly herein required to be furnished to the Lenders by the Agents, the
Agents shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial or other condition or creditworthiness of the Company which
may come into the possession of the Agents.
14.8 Indemnification. Whether or not the transactions contemplated
hereby are consummated, each Lender shall indemnify upon demand the Agents and
their respective directors, officers, employees and agents (to the extent not
reimbursed by or on behalf of the Company and without limiting the obligation of
the Company to do so), according to its applicable Pro Rata Share, from and
against any and all Indemnified Liabilities (as hereinafter defined); provided
that no Lender shall be liable for any payment to any such Person of any portion
of the Indemnified Liabilities to the extent determined by a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from the applicable Person's own gross negligence or willful misconduct. No
action taken in accordance with the directions of the Required Lenders shall be
deemed to constitute gross negligence or willful misconduct for purposes of this
Section. Without limitation of the foregoing, each Lender shall reimburse the
Agents upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs and Taxes) incurred by the Agents 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 Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agents are not reimbursed for such expenses by or on
behalf of the Company. The undertaking in this Section shall survive
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repayment of the Loans, cancellation of the Notes, expiration or termination of
the Letters of Credit, any foreclosure under, or modification, release or
discharge of, any or all of the Collateral Documents, termination of this
Agreement and the resignation or replacement of the Agents.
14.9 Agents in Individual Capacity. LaSalle, GE Capital and their
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 Loan
Parties and Affiliates as though LaSalle and GE Capital were not the Agents
hereunder and without notice to or consent of any Lender. Each Lender
acknowledges that, pursuant to such activities, LaSalle, GE Capital or their
Affiliates may receive information regarding the Company or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of the Company or such Affiliate) and acknowledge that the Agents shall be
under no obligation to provide such information to them. With respect to their
Loans (if any), LaSalle, GE Capital and their Affiliates shall have the same
rights and powers under this Agreement as any other Lender and may exercise the
same as though LaSalle and GE Capital were not the Agents, and the terms
"Lender" and "Lenders" include LaSalle, GE Capital and their Affiliates, to the
extent applicable, in their individual capacities.
14.10 Successor Agents. The Administrative Agent or Co-Agent may
resign as Agent upon 30 days' notice to the Lenders. If an Agent resigns under
this Agreement, the Required Lenders shall, with (so long as no Event of Default
exists) the consent of the Company (which shall not be unreasonably withheld or
delayed), appoint from among the Lenders a successor agent for the Lenders. If
no successor agent is appointed prior to the effective date of the resignation
of the Agent, the Agent may appoint, after consulting with the Lenders and the
Company, a successor agent from among the Lenders. 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 Agent and the term
"Administrative Agent" or "Co-Agent" as applicable shall mean such successor
agent, and the retiring Agent's appointment, powers and duties as Agent shall be
terminated. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Section 14 and Sections 15.5 and 15.16 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement. If no successor agent has accepted appointment as Agent by
the date which is 30 days following a retiring Agent's notice of resignation,
the retiring Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Agent hereunder until
such time, if any, as the Required Lenders appoint a successor agent as provided
for above.
14.11 Collateral Matters. The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion, (a) to release any
Lien granted to or held by such Agent under any Collateral Document (i) upon
termination of the Commitments and payment in full of all Loans and all other
obligations of the Company hereunder and the expiration or termination of all
Letters of Credit; (ii) constituting property sold or to be sold or disposed of
as part of or in connection with any disposition permitted hereunder; or (iii)
subject to Section 15.1, if approved, authorized or ratified in writing by the
Required Lenders; or (b) to subordinate its interest in any
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collateral to any holder of a Lien on such collateral which is permitted by
Section 11.2(d)(i) or (d)(iii) (it being understood that the Agents may
conclusively rely on a certificate from the Company in determining whether the
Debt secured by any such Lien is permitted by Section 11.1(b)). Upon request by
the Administrative Agent at any time, the Lenders will confirm in writing the
Administrative Agent's authority to release, or subordinate its interest in,
particular types or items of collateral pursuant to this Section 14.11. Each
Lender hereby authorizes the Administrative Agent to give blockage notices in
connection with any Subordinated Debt at the direction of Required Lenders and
agrees that it will not act unilaterally to deliver such notices.
14.12 Agents May File Proofs of Claim. In case of the pendency of
any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
any Loan Party, the Agents (irrespective of whether the principal of any Loan
shall then be due and payable as herein expressed or by declaration or otherwise
and irrespective of whether the Agents shall have made any demand on the
Company) shall be entitled and empowered, by intervention in such proceeding or
otherwise:
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders and the Agents
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Lenders and the Agents and their respective agents and
counsel and all other amounts due the Lenders and the Agents under Sections 5,
15.5 and 15.16) allowed in such judicial proceedings; and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Agents shall consent to the making of such payments directly to the
Lenders, to pay to the Agents any amount due for the reasonable compensation,
expenses, disbursements and advances of the Agents and their agents and counsel,
and any other amounts due the Administrative Agent under Sections 5, 15.5 and
15.16.
Nothing contained herein shall be deemed to authorize the Agents to
authorize or consent to or accept or adopt on behalf of any Lender any plan of
reorganization, arrangement, adjustment or composition affecting the Obligations
or the rights of any Lender or to authorize the Agents to vote in respect of the
claim of any Lender in any such proceeding.
14.13 Other Agents; Arrangers and Managers. None of the Lenders or
other Persons identified on the facing page or signature pages of this Agreement
as a "syndication agent," "documentation agent," "co-agent," "book manager,"
"lead manager," "arranger," "lead arranger" or "co-arranger", if any, shall have
any right, power, obligation, liability, responsibility or duty under this
Agreement and, in the case of such Lenders, those applicable to all Lenders as
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such. Without limiting the foregoing, none of the Lenders or other Persons so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.
SECTION 15 GENERAL.
15.1 Waiver; Amendments. No delay on the part of any Agent, or any
Lender in the exercise of any right, power or remedy shall operate as a waiver
thereof, nor shall any single or partial exercise by any of them of any right,
power or remedy preclude other or further exercise thereof, or the exercise of
any other right, power or remedy. No amendment, modification or waiver of, or
consent with respect to, any provision of this Agreement or the other Loan
Documents shall in any event be effective unless the same shall be in writing
and acknowledged by Lenders having an aggregate Pro Rata Shares of not less than
the aggregate Pro Rata Shares expressly designated herein with respect thereto
or, in the absence of such designation as to any provision of this Agreement, by
the Required Lenders, and then any such amendment, modification, waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No amendment, modification, waiver or consent shall (a)
extend or increase the Commitment of any Lender without the written consent of
such Lender, (b) extend the date scheduled for payment of any principal
(excluding mandatory prepayments) of or interest on the Loans or any fees
payable hereunder without the written consent of each Lender directly affected
thereby, (c) reduce the principal amount of any Loan, the rate of interest
thereon or any fees payable hereunder, without the consent of each Lender
directly affected thereby; or (d) release any party from its obligations under
the Guaranty or all or any substantial part of the collateral granted under the
Collateral Documents, change the definition of Required Lenders, any provision
of this Section 15.1 or reduce the aggregate Pro Rata Share required to effect
an amendment, modification, waiver or consent, without, in each case, the
written consent of all Lenders. No provision of Sections 6.2.2 or 6.3 with
respect to the timing or application of mandatory prepayments of the Loans shall
be amended, modified or waived without the consent of Required Lenders. No
provision of Section 14 or other provision of this Agreement affecting the any
Agent in its capacity as such shall be amended, modified or waived without the
consent of the such Agent. No provision of this Agreement relating to the rights
or duties of the Issuing Lender in its capacity as such shall be amended,
modified or waived without the consent of the Issuing Lender.
15.2 Confirmations. The Company and each holder of a Note agree
from time to time, upon written request received by it from the other, to
confirm to the other in writing (with a copy of each such confirmation to the
Administrative Agent) the aggregate unpaid principal amount of the Loans then
outstanding under such Note.
15.3 Notices. Except as otherwise provided in Sections 2.2.2 and
2.2.3, all notices hereunder shall be in writing (including facsimile
transmission) and shall be sent to the applicable party at its address shown on
Annex B or at such other address as such party may, by written notice received
by the other parties, have designated as its address for such purpose.
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Notices sent by facsimile transmission shall be deemed to have been given when
sent; notices sent by mail shall be deemed to have been given three Business
Days after the date when sent by registered or certified mail, postage prepaid;
and notices sent by hand delivery or overnight courier service shall be deemed
to have been given when received. For purposes of Sections 2.2.2 and 2.2.3, the
Agents shall be entitled to rely on telephonic instructions from any person that
the Agents in good faith believe is an authorized officer or employee of the
Company, and the Company shall hold the Agents and each other Lender harmless
from any loss, cost or expense resulting from any such reliance.
15.4 Computations. Where 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 the
purpose of this Agreement, such determination or calculation shall, to the
extent applicable and except as otherwise specified in this Agreement, be made
in accordance with GAAP, consistently applied; provided that if the Company
notifies the Administrative Agent that the Company wishes to amend any covenant
in Section 10 (or any related definition) to eliminate or to take into account
the effect of any change in GAAP on the operation of such covenant (or if the
Administrative Agent notifies the Company that the Required Lenders wish to
amend Section 10 (or any related definition) for such purpose), then the
Company's compliance with such covenant shall be determined on the basis of GAAP
in effect immediately before the relevant change in GAAP became effective, until
either such notice is withdrawn or such covenant (or related definition) is
amended in a manner satisfactory to the Company and the Required Lenders.
15.5 Costs, Expenses and Taxes. The Company agrees to pay on demand
all reasonable out-of-pocket costs and expenses of the Agents (including
Attorney Costs and any Taxes) in connection with the preparation, execution,
syndication, delivery and administration (including perfection and protection of
any collateral and the costs of Intralinks (or other similar service), if
applicable) of this Agreement, the other Loan Documents and all other documents
provided for herein or delivered or to be delivered hereunder or in connection
herewith (including any amendment, supplement or waiver to any Loan Document),
whether or not the transactions contemplated hereby or thereby shall be
consummated, and all reasonable out-of-pocket costs and expenses (including
Attorney Costs and any Taxes) incurred by the Agents and each Lender after an
Event of Default in connection with the collection of the Obligations or the
enforcement of this Agreement, the other Loan Documents or any such other
documents or during any workout, restructuring or negotiations in respect
thereof. In addition, the Company agrees to pay, and to save the Agents and the
Lenders harmless from all liability for, any fees of the Company's auditors in
connection with any reasonable exercise by the Agents and the Lenders of their
rights pursuant to Section 10.2. All Obligations provided for in this Section
15.5 shall survive repayment of the Loans, cancellation of the Notes, expiration
or termination of the Letters of Credit and termination of this Agreement until
expiration of the applicable statute of limitations period.
15.6 Assignments; Participations.
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15.6.1 Assignments. (a) Any Lender may at any time assign to one or
more Persons (any such Person, an "Assignee") all or any portion of such
Lender's Loans and Commitments, with the prior written consent of the Agents,
the Issuing Lender and, so long as no Event of Default exists, the Company
(which consents shall not be unreasonably withheld or delayed and shall not be
required for an assignment by a Lender to a Lender or an Affiliate of a Lender).
Except as the Administrative Agent may otherwise agree, any such assignment
shall be in a minimum aggregate amount equal to $5,000,000 or, if less, the
remaining Commitment and Loans held by the assigning Lender. The Company and the
Agents shall be entitled to continue to deal solely and directly with such
Lender in connection with the interests so assigned to an Assignee until the
Agents shall have received and accepted an effective assignment agreement in
substantially the form of Exhibit D hereto (an "Assignment Agreement") executed,
delivered and fully completed by the applicable parties thereto and a processing
fee of $3,500 payable by Assignor or Assignee. No assignment may be made to any
Person if at the time of such assignment the Company would be obligated to pay
any greater amount under Section 7.6 or 8 to the Assignee than the Company is
then obligated to pay to the assigning Lender under such Sections (and if any
assignment is made in violation of the foregoing, the Company will not be
required to pay such greater amounts). Any attempted assignment not made in
accordance with this Section 15.6.1 shall be treated as the sale of a
participation under Section 15.6.2. The Company shall be deemed to have granted
its consent to any assignment requiring its consent hereunder unless the Company
has expressly objected to such assignment within three Business Days after
notice thereof.
(b) From and after the date on which the conditions described
above have been met, (i) such Assignee shall be deemed automatically to have
become a party hereto and, to the extent that rights and obligations hereunder
have been assigned to such Assignee pursuant to such Assignment Agreement, shall
have the rights and obligations of a Lender hereunder and (ii) the assigning
Lender, to the extent that rights and obligations hereunder have been assigned
by it pursuant to such Assignment Agreement, shall be released from its rights
(other than its indemnification rights) and obligations hereunder. Upon the
request of the Assignee (and, as applicable, the assigning Lender) pursuant to
an effective Assignment Agreement, the Company shall execute and deliver to the
Administrative Agent for delivery to the Assignee (and, as applicable, the
assigning Lender) a Note in the principal amount of the Assignee's Pro Rata
Share of the Revolving Commitment (and, as applicable, a Note in the principal
amount of the Pro Rata Share of the Revolving Commitment retained by the
assigning Lender. Each such Note shall be dated the effective date of such
assignment. Upon receipt by the assigning Lender of such Note, the assigning
Lender shall return to the Company any prior Note held by it.
(c) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
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(d) Notwithstanding the foregoing provisions of this Section 15.6,
any lender (a "Granting Lender"), may grant to a special purpose funding vehicle
(an "SPC"), identified as such in writing by the Granting Lender to the
Administrative Agent and the Company, the option to provide to the Company all
or any part of any Loans that such Granting Lender would otherwise be obligated
to make the Company pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPC to make any Loan; and (ii) if an SPC
elects not to exercise such option or otherwise fails to provide all or any part
of such Loan, the Granting Lender shall be obligated to make such Loan pursuant
to the terms hereof. The making of a Loan by an SPC hereunder shall utilize the
Commitment of the Granting Lender to the same extent, and as if such Loan were
made by such Granting Lender. No SPC shall be liable for any indemnity or
similar payment obligation under this Agreement (all liability for which shall
remain with the Granting Lender). Any SPC may (i) with notice to, but without
the prior written consent of, the Company and the Administrative Agent and
without paying any processing fee therefore, assign all or a portion of its
interests in any Loans to the Granting Lender or to any financial institutions
(consented to by the Company and the Agents) providing liquidity and/or credit
support to or for the account of such SPC to support the funding or maintenance
of Loans and (ii) disclose on a confidential basis any non-public information
relating to its Loans to any rating agency, commercial paper dealer or provider
of any surety, guarantee or credit or liquidity enhancement to such SPC. This
Section 15.6.1(d) may not be amended without the prior written consent of each
Granting Lender, all or any of whose Loans are being funded by an SPC at the
time of such amendment. For the avoidance of doubt, the Granting Lender shall
for all purposes, including without limitation, the approval of any amendment or
waiver of any provision of any Loan Document or the obligation to pay any amount
otherwise payable by the Granting Lender under the Loan Documents, continue to
be the Lender of record hereunder.
15.6.2 Participations. Any Lender may at any time sell to one or more
Persons participating interests in its Loans, Commitments or other interests
hereunder (any such Person, a "Participant"). In the event of a sale by a Lender
of a participating interest to a Participant, (a) such Lender's obligations
hereunder shall remain unchanged for all purposes, (b) the Company and the
Agents shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations hereunder and (c) all amounts payable
by the Company shall be determined as if such Lender had not sold such
participation and shall be paid directly to such Lender. No Participant shall
have any direct or indirect voting rights hereunder except with respect to any
event described in Section 15.1 expressly requiring the unanimous vote of all
Lenders or, as applicable, all affected Lenders. Each Lender agrees to
incorporate the requirements of the preceding sentence into each participation
agreement which such Lender enters into with any Participant. The Company agrees
that if amounts outstanding under this Agreement are due and payable (as a
result of acceleration or otherwise), each Participant shall be deemed to have
the right of set-off in respect of its participating interest in amounts owing
under this Agreement and with respect to any Letter of Credit to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement; provided that such right of set-off shall be
subject to the obligation of each Participant to share with the Lenders, and the
Lenders agree to share with each Participant, as provided in Section 7.5. The
Company also agrees that each Participant shall be entitled to the benefits of
Section 7.6 or 8 as
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if it were a Lender (provided that on the date of the participation no
Participant shall be entitled to any greater compensation pursuant to Section
7.6 or 8 than would have been paid to the participating Lender on such date if
no participation had been sold and that each Participant complies with Section
7.6(d) as if it were an Assignee).
15.7 Register. The Administrative Agent shall maintain a copy of
each Assignment Agreement delivered and accepted by it and register (the
"Register") for the recordation of names and addresses of the Lenders and the
Commitment of each Lender from time to time and whether such Lender is the
original Lender or the Assignee. No assignment shall be effective unless and
until the Assignment Agreement is accepted and registered in the Register. All
records of transfer of a Lender's interest in the Register shall be conclusive,
absent manifest error, as to the ownership of the interests in the Loans. The
Administrative Agent shall provide the Co-Agent a copy of the Register promptly
upon the Co-Agent's request. The Administrative Agent shall not incur any
liability of any kind with respect to any Lender with respect to the maintenance
of the Register.
15.8 GOVERNING LAW. THIS AGREEMENT AND EACH NOTE SHALL BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF ILLINOIS
APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.
15.9 Confidentiality. As required by federal law and the
Administrative Agent's policies and practices, the Administrative Agent may need
to obtain, verify, and record certain customer identification information and
documentation in connection with opening or maintaining accounts, or
establishing or continuing to provide services. The Agents and each Lender agree
to use commercially reasonable efforts (equivalent to the efforts the Agents or
such Lender applies to maintain the confidentiality of its own confidential
information) to maintain as confidential all information provided to them by any
Loan Party and designated as confidential for a period of 2 years following
receipt thereof, except that the Agents and each Lender may disclose such
information (a) to Persons employed or engaged by the such Agent or such Lender
in evaluating, approving, structuring or administering the Loans and the
Commitments; (b) to any assignee or participant or potential assignee or
participant that has agreed to comply with the covenant contained in this
Section 15.9 (and any such assignee or participant or potential assignee or
participant may disclose such information to Persons employed or engaged by them
as described in clause (a) above); (c) as required or requested by any federal
or state regulatory authority or examiner, or any insurance industry
association, or as reasonably believed by the such Agent or such Lender to be
compelled by any court decree, subpoena or legal or administrative order or
process; (d) as, on the advice of such Agent's or such Lender's counsel, is
required by law; (e) in connection with the exercise of any right or remedy
under the Loan Documents or in connection with any litigation to which such
Agent or such Lender is a party; (f) to any nationally recognized rating agency
that requires access to information about a Lender's investment portfolio in
connection with ratings issued with respect to such Lender; (g) to any Affiliate
of any Agent, the Issuing Lender or any other Lender who may provide Bank
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Products to the Loan Parties; or (h) that ceases to be confidential through no
fault of any Agent or any Lender. Notwithstanding the foregoing, the Company
consents to the publication by any Agent or any Lender of a tombstone or similar
advertising material relating to the financing transactions contemplated by this
Agreement, and the Agents reserve the right to provide to industry trade
organizations information necessary and customary for inclusion in league table
measurements; provided that GE Capital may not be referenced in any such
advertising material without GE Capital's prior written consent.
15.10 Severability. Whenever possible each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable 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 Agreement. All obligations of the
Company and rights of the Agents and the Lenders expressed herein or in any
other Loan Document shall be in addition to and not in limitation of those
provided by applicable law.
15.11 Nature of Remedies. All Obligations of the Company and rights
of the Administrative Agent and the Lenders expressed herein or in any other
Loan Document shall be in addition to and not in limitation of those provided by
applicable law. No failure to exercise and no delay in exercising, on the part
of any Agent or any Lender, any right, remedy, power or 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.
15.12 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the parties
hereto and supersedes all prior or contemporaneous agreements and understandings
of such Persons, verbal or written, relating to the subject matter hereof and
thereof (except as relates to the fees described in Section 5.3) and any prior
arrangements made with respect to the payment by the Company of (or any
indemnification for) any fees, costs or expenses payable to or incurred (or to
be incurred) by or on behalf of the Agents or the Lenders.
15.13 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts and
each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Agreement. Receipt
of an executed signature page to this Agreement by facsimile or other electronic
transmission shall constitute effective delivery thereof. Electronic records of
executed Loan Documents maintained by the Lenders shall be deemed to be
originals.
15.14 Successors and Assigns. This Agreement shall be binding upon
the Company, the Lenders and the Agents and their respective successors and
assigns, and shall inure to the benefit of the Company, the Lenders and the
Agents and the successors and assigns of the Lenders and the Agents. No other
Person shall be a direct or indirect legal beneficiary of, or have any direct
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or indirect cause of action or claim in connection with, this Agreement or any
of the other Loan Documents. The Company may not assign or transfer any of its
rights or Obligations under this Agreement without the prior written consent of
the Agents and each Lender.
15.15 Captions. Section captions used in this Agreement are for
convenience only and shall not affect the construction of this Agreement.
15.16 Customer Identification - USA Patriot Act Notice. Each Lender
and LaSalle (for itself and not on behalf of any other party) hereby notifies
the Loan Parties that, pursuant to the requirements of the USA Patriot Act,
Title III of Pub. L. 107-56, signed into law October 26, 2001 (the "Act"), it is
required to obtain, verify and record information that identifies the Loan
Parties, which information includes the name and address of the Loan Parties and
other information that will allow such Lender or LaSalle, as applicable, to
identify the Loan Parties in accordance with the Act.
15.17 INDEMNIFICATION BY THE COMPANY. IN CONSIDERATION OF THE
EXECUTION AND DELIVERY OF THIS AGREEMENT BY THE AGENTS AND THE LENDERS AND THE
AGREEMENT TO EXTEND THE COMMITMENTS PROVIDED HEREUNDER, THE COMPANY HEREBY
AGREES TO INDEMNIFY, EXONERATE AND HOLD EACH AGENT, EACH LENDER AND EACH OF THE
OFFICERS, DIRECTORS, EMPLOYEES, AFFILIATES AND AGENTS OF THE AGENTS AND EACH
LENDER (EACH A "LENDER PARTY") FREE AND HARMLESS FROM AND AGAINST ANY AND ALL
ACTIONS, CAUSES OF ACTION, SUITS, LOSSES, LIABILITIES, DAMAGES AND EXPENSES,
INCLUDING ATTORNEY COSTS (COLLECTIVELY, THE "INDEMNIFIED LIABILITIES"), INCURRED
BY THE LENDER PARTIES OR ANY OF THEM AS A RESULT OF, OR ARISING OUT OF, OR
RELATING TO (A) ANY TENDER OFFER, MERGER, PURCHASE OF CAPITAL SECURITIES,
PURCHASE OF ASSETS OR OTHER SIMILAR TRANSACTION FINANCED OR PROPOSED TO BE
FINANCED IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, WITH THE PROCEEDS OF ANY
OF THE LOANS, (B) THE USE, HANDLING, RELEASE, EMISSION, DISCHARGE,
TRANSPORTATION, STORAGE, TREATMENT OR DISPOSAL OF ANY HAZARDOUS SUBSTANCE AT ANY
PROPERTY OWNED OR LEASED BY ANY LOAN PARTY, (C) ANY VIOLATION OF ANY
ENVIRONMENTAL LAWS WITH RESPECT TO CONDITIONS AT ANY PROPERTY OWNED OR LEASED BY
ANY LOAN PARTY OR THE OPERATIONS CONDUCTED THEREON, (D) THE INVESTIGATION,
CLEANUP OR REMEDIATION OF OFFSITE LOCATIONS AT WHICH ANY LOAN PARTY OR THEIR
RESPECTIVE PREDECESSORS ARE ALLEGED TO HAVE DIRECTLY OR INDIRECTLY DISPOSED OF
HAZARDOUS SUBSTANCES OR (E) THE EXECUTION, DELIVERY, PERFORMANCE OR ENFORCEMENT
OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BY ANY OF THE LENDER PARTIES,
EXCEPT FOR ANY SUCH INDEMNIFIED LIABILITIES ARISING ON ACCOUNT OF CLAIMS AMONG
OR BETWEEN THE LENDERS (EXCEPT UPON THE OCCURRENCE OF A DEFAULT OR EVENT OF
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DEFAULT) OR THE APPLICABLE LENDER PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT
AS DETERMINED BY A FINAL, NONAPPEALABLE JUDGMENT BY A COURT OF COMPETENT
JURISDICTION. IF AND TO THE EXTENT THAT THE FOREGOING UNDERTAKING MAY BE
UNENFORCEABLE FOR ANY REASON, THE COMPANY HEREBY AGREES TO MAKE THE MAXIMUM
CONTRIBUTION TO THE PAYMENT AND SATISFACTION OF EACH OF THE INDEMNIFIED
LIABILITIES WHICH IS PERMISSIBLE UNDER APPLICABLE LAW. ALL OBLIGATIONS PROVIDED
FOR IN THIS SECTION 15.17 SHALL SURVIVE REPAYMENT OF THE LOANS, CANCELLATION OF
THE NOTES, EXPIRATION OR TERMINATION OF THE LETTERS OF CREDIT, ANY FORECLOSURE
UNDER, OR ANY MODIFICATION, RELEASE OR DISCHARGE OF, ANY OR ALL OF THE
COLLATERAL DOCUMENTS AND TERMINATION OF THIS AGREEMENT. UNTIL THE EXPIRATION OF
THE APPLICABLE STATUTE OF LIMITATIONS PERIOD.
15.18 Nonliability of Lenders. The relationship between the Company
on the one hand and the Lenders, Administrative Agent and Co-Agent on the other
hand shall be solely that of borrower and lender. Neither the Administrative
Agent, Co-Agent nor any Lender has any fiduciary relationship with or duty to
any Loan Party arising out of or in connection with this Agreement or any of the
other Loan Documents, and the relationship between the Loan Parties, on the one
hand, and the Administrative Agent, Co-Agent and the Lenders, on the other hand,
in connection herewith or therewith is solely that of debtor and creditor.
Neither the Administrative Agent, Co-Agent nor any Lender undertakes any
responsibility to any Loan Party to review or inform any Loan Party of any
matter in connection with any phase of any Loan Party's business or operations.
The Company agrees, on behalf of itself and each other Loan Party, that neither
the Administrative Agent, Co-Agent nor any Lender shall have liability to any
Loan Party (whether sounding in tort, contract or otherwise) for losses suffered
by any Loan Party in connection with, arising out of, or in any way related to
the transactions contemplated and the relationship established by the Loan
Documents, or any act, omission or event occurring in connection therewith,
unless it is determined in a final non-appealable judgment by a court of
competent jurisdiction that such losses resulted from the gross negligence or
willful misconduct of the party from which recovery is sought. NO LENDER PARTY
SHALL BE LIABLE FOR ANY DAMAGES ARISING FROM THE USE BY OTHERS OF ANY
INFORMATION OR OTHER MATERIALS OBTAINED THROUGH INTRALINKS OR OTHER SIMILAR
INFORMATION TRANSMISSION SYSTEMS IN CONNECTION WITH THIS AGREEMENT, NOR SHALL
ANY LENDER PARTY HAVE ANY LIABILITY WITH RESPECT TO, AND THE COMPANY ON BEHALF
OF ITSELF AND EACH OTHER LOAN PARTY, HEREBY WAIVES, RELEASES AND AGREES NOT TO
XXX FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ARISING OUT OF ITS ACTIVITIES IN
CONNECTION HEREWITH OR THEREWITH (WHETHER BEFORE OR AFTER THE CLOSING DATE). The
Company acknowledges that it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents to which
it is a party. No joint venture is created
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hereby or by the other Loan Documents or otherwise exists by virtue of the
transactions contemplated hereby among the Lenders or among the Loan Parties and
the Lenders.
15.19 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE
CIRCUIT COURT OF XXXX COUNTY, ILLINOIS OR IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS; PROVIDED THAT NOTHING IN THIS AGREEMENT
SHALL BE DEEMED OR OPERATE TO PRECLUDE THE ADMINISTRATIVE AGENT FROM BRINGING
SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION. THE COMPANY HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE CIRCUIT COURT OF
XXXX COUNTY, ILLINOIS AND OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN
DISTRICT OF ILLINOIS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE.
THE COMPANY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
ILLINOIS. THE COMPANY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
15.20 WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE AGENTS AND EACH
LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY NOTE, ANY OTHER LOAN
DOCUMENT AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH
MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING
FROM ANY LENDING RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING,
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY.
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