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Execution Counterpart
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BE AEROSPACE, INC.
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FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of October 29, 1993
Amended and Restated as of April 3, 1998
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THE CHASE MANHATTAN BANK,
as Administrative Agent
NATIONSBANK, N.A.,
as Documentation Agent
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it
is attached but is inserted for convenience of reference only.
page
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Section 1. Definitions and Accounting Matters...............................................1
1.01 Certain Defined Terms............................................................1
1.02 Accounting Terms and Determinations.............................................19
1.03 Classes and Types of Loans......................................................20
Section 2. Commitments, Loans, Notes and Prepayments.......................................20
2.01 Loans...........................................................................20
2.02 Borrowings......................................................................21
2.03 Letters of Credit...............................................................21
2.04 Changes of Commitments..........................................................25
2.05 Commitment Fee..................................................................26
2.06 Lending Offices.................................................................26
2.07 Several Obligations; Remedies Independent.......................................26
2.08 Evidence of Debt................................................................26
2.09 Optional Prepayments and Conversions or Continuations of Loans..................27
2.10 Mandatory Prepayments and Reductions of Commitments.............................27
Section 3. Payments of Principal and Interest..............................................29
3.01 Repayment of Loans..............................................................29
3.02 Interest........................................................................30
Section 4. Payments; Pro Rata Treatment; Computations; Etc.................................31
4.01 Payments........................................................................31
4.02 Pro Rata Treatment..............................................................31
4.03 Computations....................................................................32
4.04 Minimum Amounts.................................................................32
4.05 Certain Notices.................................................................32
4.06 Non-Receipt of Funds by the Administrative Agent................................33
4.07 Sharing of Payments, Etc........................................................34
Section 5. Yield Protection, Etc...........................................................35
5.01 Additional Costs................................................................35
5.02 Limitation on Types of Loans....................................................37
5.03 Illegality......................................................................38
5.04 Treatment of Affected Loans.....................................................38
5.05 Compensation....................................................................39
5.06 Additional Costs in Respect of Letters of Credit................................40
5.07 U.S. Taxes......................................................................40
(i)
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Section 6. Conditions Precedent............................................................41
6.01 Conditions to Effectiveness.....................................................41
6.02 Initial and Subsequent Extensions of Credit.....................................44
Section 7. Representations and Warranties..................................................44
7.01 Corporate Existence.............................................................44
7.02 Financial Condition.............................................................45
7.03 Litigation......................................................................45
7.04 No Breach.......................................................................45
7.05 Action..........................................................................46
7.06 Approvals.......................................................................46
7.07 Use of Credit...................................................................46
7.08 ERISA...........................................................................46
7.09 Taxes...........................................................................47
7.10 Investment Company Act..........................................................47
7.11 Public Utility Holding Company Act..............................................47
7.12 Material Agreements and Liens...................................................47
7.13 Environmental Matters...........................................................48
7.14 Capitalization..................................................................49
7.15 Subsidiaries, Etc...............................................................50
7.16 Title to Assets.................................................................50
7.17 Compliance with Law.............................................................51
7.18 True and Complete Disclosure....................................................51
7.19 Year 2000.......................................................................51
Section 8. Covenants of the Company........................................................52
8.01 Financial Statements, Etc.......................................................52
8.02 Litigation......................................................................55
8.03 Existence, Etc..................................................................55
8.04 Insurance.......................................................................56
8.05 Prohibition of Fundamental Changes..............................................56
8.06 Limitation on Liens.............................................................57
8.07 Indebtedness....................................................................58
8.08 Investments.....................................................................59
8.09 Restricted Payments.............................................................60
8.10 Leverage Ratio..................................................................60
8.11 Adjusted Net Worth..............................................................61
8.12 Interest Coverage Ratio.........................................................61
8.13 [Intentionally Omitted.]........................................................62
8.14 Lines of Business...............................................................62
8.15 Transactions with Affiliates....................................................62
8.16 Use of Proceeds.................................................................63
8.17 Certain Obligations Respecting Subsidiaries.....................................63
8.18 Modifications of Certain Documents..............................................64
8.19 Environmental Matters...........................................................64
(ii)
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8.20 Security for Loans..............................................................65
8.21 Redemption of Senior Subordinated Indebtedness..................................65
Section 9. Events of Default...............................................................65
Section 10. The Administrative Agent........................................................68
10.01 Appointment, Powers and Immunities..............................................68
10.02 Reliance by Administrative Agent................................................69
10.03 Defaults........................................................................69
10.04 Rights as a Lender..............................................................70
10.05 Indemnification.................................................................70
10.06 Non-Reliance on Administrative Agent and Other Lenders..........................71
10.07 Failure to Act..................................................................71
10.08 Resignation or Removal of Administrative Agent..................................71
10.09 Consents under Basic Documents..................................................72
10.10 Collateral Sub-Agents...........................................................72
10.11 Documentation Agent.............................................................72
Section 11. Miscellaneous...................................................................72
11.01 Waiver..........................................................................73
11.02 Notices.........................................................................73
11.03 Expenses, Etc...................................................................73
11.04 Amendments, Etc.................................................................74
11.05 Successors and Assigns..........................................................75
11.06 Assignments and Participations..................................................75
11.07 Survival........................................................................77
11.08 Captions........................................................................77
11.09 Counterparts....................................................................77
11.10 Governing Law; Submission to Jurisdiction.......................................78
11.11 Waiver of Jury Trial............................................................78
11.12 Treatment of Certain Information; Confidentiality...............................78
(iii)
5
Annex 1 - Commitments
SCHEDULE I - Material Agreements and Liens
SCHEDULE II - Hazardous Materials
SCHEDULE III - Subsidiaries and Investments
SCHEDULE IV - Approvals and Compliance
SCHEDULE V - Existing Letters of Credit
SCHEDULE VI - Taxes
SCHEDULE VII - Transactions with Affiliates
EXHIBIT A-1 - Form of Security Agreement
EXHIBIT A-2 - Form of In-Flight Guarantee and Security Agreement
EXHIBIT B - Form of Confidentiality Agreement
(iv)
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FOURTH AMENDED AND RESTATED CREDIT AGREEMENT dated as of October
29, 1993, amended and restated as of April 3, 1998, among: BE AEROSPACE, INC., a
corporation duly organized and validly existing under the laws of the State of
Delaware (the "COMPANY"); each of the lenders that is a signatory hereto
identified under the caption "LENDERS" on the signature pages hereto or which,
pursuant to Section 11.06(b) hereof, shall become a "Lender" hereunder
(individually, a "LENDER" and, collectively, the "LENDERS"); and THE CHASE
MANHATTAN BANK, a New York banking corporation, as agent for the Lenders (in
such capacity, together with its successors in such capacity, the
"ADMINISTRATIVE AGENT").
The Company, certain Lenders and the Administrative Agent are
party to a Third Amended and Restated Credit Agreement dated as of October 29,
1993, amended and restated as of May 29, 1997 (as modified and supplemented and
in effect immediately prior to the Amendment Effective Date referred to below,
the "EXISTING CREDIT AGREEMENT"). The Company has requested that the Lenders and
the Administrative Agent agree to amend and restate the Existing Credit
Agreement, and the Lenders and the Administrative Agent are willing to amend and
restate the Existing Credit Agreement, all on the terms and conditions herein
set forth.
Accordingly, the parties hereto agree to amend and restate the
Existing Credit Agreement so that, as amended and restated, it reads in its
entirety as provided herein.
Section 1. DEFINITIONS AND ACCOUNTING MATTERS.
1.01 CERTAIN DEFINED TERMS.
As used herein, the following terms shall have the following
meanings (all terms defined in this Section 1.01 or in other provisions of this
Agreement in the singular to have the same meanings when used in the plural and
VICE VERSA):
"ACQUISITION" shall mean any transaction, or any series of
related transactions, by which the Company and/or any of its Subsidiaries (a)
acquires any ongoing business or all or substantially all of the assets of any
Person, whether through purchase of assets, merger or otherwise, (b) directly or
indirectly acquires control of at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election of
directors or (c) directly or indirectly acquires control of a majority ownership
interest in any partnership, joint venture or similar arrangement. The terms
"ACQUIRE" and "ACQUIRED" used as a verb shall have a correlative meaning.
"ADJUSTED NET WORTH" shall mean, as at any date, the sum of (a)
total stockholders' equity of the Company and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP) PLUS (b) the
aggregate amount of Restricted Payments made since November 29, 1997 in respect
of the purchase, redemption, retirement or other acquisition of any shares of
any class of stock of the Company permitted under Section 8.09
CREDIT AGREEMENT
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hereof PLUS (c) the fair market value of any shares of capital stock of the
Company (determined as of the date such shares are issued) issued after November
29, 1997 which are utilized in any business combination accounted for using
pooling of interest accounting PLUS (d) an amount not to exceed $35,000,000 in
the aggregate of the after-tax amount (calculated using the then effective
corporate Federal tax rate, regardless of the after-tax amount determined in
accordance with GAAP) of any nonrecurring noncash write-offs of intangible
assets since November 29, 1997 PLUS (e) the amount of any purchased research and
development and related acquisition costs of a target company to the extent such
costs are or have been expensed after November 29, 1997.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in a form supplied by the Administrative Agent.
"AFFILIATE" shall mean any Person that directly or indirectly
controls, or is under common control with, or is controlled by, the Company and,
if such Person is an individual, any member of the immediate family (including
parents, spouse, children and siblings) of such individual and any trust whose
principal beneficiary is such individual or one or more members of such
immediate family and any Person who is controlled by any such member or trust.
As used in this definition, "CONTROL" (including, with its correlative meanings,
"CONTROLLED BY" and "UNDER COMMON CONTROL WITH") shall mean possession, directly
or indirectly, of power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise), PROVIDED that, in any event, any
Person that owns directly or indirectly securities having 5% or more of the
voting power for the election of directors or other governing body of a
corporation or 5% or more of the partnership or other ownership interests of any
other Person (other than as a limited partner of such other Person) will be
deemed to control such corporation or other Person. Notwithstanding the
foregoing, (a) no individual shall be an Affiliate solely by reason of his or
her being a director, officer or employee of the Company or any of its
Subsidiaries and (b) none of the Subsidiaries of the Company shall be
Affiliates.
"AMENDMENT EFFECTIVE DATE" shall mean the date on which all of
the conditions set forth in Section 6.01 hereof shall have been satisfied or
waived by the Lenders and the Administrative Agent.
"APPLICABLE LENDING OFFICE" shall mean, for each Lender and for
each Type of Loan, the "Lending Office" of such Lender (or of an affiliate of
such Lender) designated for such Type of Loan in the Administrative
Questionnaire submitted by such Lender or such other office of such Lender (or
of an affiliate of such Lender) as such Lender may from time to time specify to
the Administrative Agent and the Company as the office by which its Loans of
such Type are to be made and maintained.
CREDIT AGREEMENT
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"APPLICABLE MARGIN" shall mean with respect to Base Rate Loans
and Eurodollar Loans, the rate for such Type of Loan for each level period set
forth in the schedule below:
Applicable Margin
Level Period Base Rate Loans Eurodollar Loans
------------------------ --------------- ----------------
Level I Period 0.00% 0.500%
Level II Period 0.00% 0.750%
Level III Period 0.00% 0.875%
Level IV Period 0.00% 1.000%
Level V Period 0.00% 1.250%
Level VI Period 0.25% 1.500%
Level VII Period 0.75% 2.000%
PROVIDED that notwithstanding anything herein to the contrary, the Applicable
Margin from the Amendment Effective Date through August 31, 1998 shall not be
less than the rate for a Level V Period.
"B/E SERVICES" shall mean B/E Services, Inc., a Delaware
corporation and Wholly Owned Subsidiary of the Company.
"BANKRUPTCY CODE" shall mean the Federal Bankruptcy Code of 1978,
as amended from time to time.
"BASE RATE" shall mean, for any day, a rate per annum equal to
the higher of (a) the Federal Funds Rate for such day plus 1/2 of 1% and (b) the
Prime Rate for such day. Each change in any interest rate provided for herein
based upon the Base Rate resulting from a change in the Base Rate shall take
effect at the time of such change in the Base Rate.
"BASE RATE LOANS" shall mean Loans that bear interest at rates
based upon the Base Rate.
"BASIC DOCUMENTS" shall mean, collectively, this Agreement, the
Notes, the Letter of Credit Documents and the Security Documents.
"BUSINESS DAY" shall mean any day (a) on which commercial banks
are not authorized or required to close in New York City and (b) if such day
relates to a borrowing of, a payment or prepayment of principal of or interest
on, a Conversion of or into, or an Interest Period for, a Eurodollar Loan or a
notice by the Company with respect to any such borrowing, payment, prepayment,
Conversion or Interest Period, which is also a day on which dealings in Dollar
deposits are carried out in the London interbank market.
CREDIT AGREEMENT
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"CALCULATION PERIOD" shall mean, as at any date, the period of
four consecutive complete fiscal quarters of the Company ending on or most
recently ended prior to such date for which financial statements have been
delivered pursuant to Sections 7.02(a), 8.01(a), 8.01(b) or 8.01(h) hereof.
"CAPITAL LEASE OBLIGATIONS" shall mean, for any Person, all
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards Board), and,
for purposes of this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP (including such
Statement No. 13).
"CASUALTY EVENT" shall mean, with respect to any Property of any
Person, any loss of or damage to, or any condemnation or other taking of, such
Property for which such Person or any of its Subsidiaries receives insurance
proceeds, or proceeds of a condemnation award or other compensation.
"CHASE" shall mean The Chase Manhattan Bank.
"CLASS" shall have the meaning assigned to such term in Section
1.03 hereof.
"CODE" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"COLLATERAL ACCOUNT" shall have the meaning assigned to such term
in Section 4.01 of the Security Agreement.
"COMMITMENT FEE RATE" shall mean (a) 0.2000% for any Level I
Period, (b) 0.2250% for any Level II Period, (c) 0.2500% for any Level III
Period, (d) 0.2750% for any Level IV Period, (e) 0.3250% for any Level V Period,
(f) 0.3750% for any Level VI Period and (e) 0.5000% for any Level VII Period,
PROVIDED that notwithstanding anything herein to the contrary, the Commitment
Fee Rate from the Amendment Effective Date through August 31, 1998 shall not be
less than the rate for a Level V Period. .
"COMMITMENTS" shall mean the Series A Commitments and the
Series B Commitments.
"CONTINUE", "CONTINUATION" and "CONTINUED" shall refer to the
continuation pursuant to Section 2.09 hereof of a Eurodollar Loan from one
Interest Period to the next Interest Period.
"CONVERT", "CONVERSION" and "CONVERTED" shall refer to a
conversion pursuant to Section 2.09 hereof of one Type of Loans into another
Type of Loans, which may be
CREDIT AGREEMENT
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accompanied by the transfer by a Lender (at its sole discretion) of a Loan from
one Applicable Lending Office to another.
"DEFAULT" shall mean an Event of Default or an event that with
notice or lapse of time or both would become an Event of Default.
"DISPOSITION" shall mean any sale, assignment, transfer or other
disposition of any Property (whether now owned or hereafter acquired) by the
Company or any of its Subsidiaries to any Person excluding any sale, assignment,
transfer or other disposition of inventory in the ordinary course of business
and on ordinary business terms; PROVIDED that the term "Disposition" shall not
include (i) any Equity Issuance (as such term is defined in this Section 1.01
without giving effect to the proviso therein), (ii) any sale, assignment,
transfer or other disposition of Property by any Subsidiary of the Company to
the Company or to any other Subsidiary of the Company, in each case for
consideration that is not in excess of the fair market value of such Property as
determined in good faith by the chief financial officer of the Company or (iii)
any sale, assignment, transfer or other disposition of Property by the Company
or any Subsidiary of the Company to a joint venture, subject to the proviso in
Section 8.08(h) hereof. The creation of any Lien on any Property permitted under
Section 8.06 hereof shall not constitute a "DISPOSITION" of such Property. The
term "DISPOSE" shall have a correlative meaning.
"DOLLARS" and "$" shall mean lawful money of the United States of
America.
"DOMESTIC SUBSIDIARY" shall mean any Subsidiary of the Company
that is incorporated under the law of any State of the United States of America.
"EBITDA" shall mean, for any period of four consecutive fiscal
quarters of the Company, for the Company and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP), net operating
earnings (calculated before depreciation and amortization expense, non-recurring
non-cash write-offs of assets (to the extent deducted in computing net operating
earnings), Interest Expense, taxes and extraordinary and unusual items) for such
period.
"ENVIRONMENTAL CLAIM" shall mean, with respect to any Person, (a)
any written notice, claim, demand or other communication (collectively, a
"CLAIM") by any other Person alleging or asserting such Person's liability for
investigatory costs, cleanup costs, governmental response costs, damages to
natural resources or other Property, personal injuries, fines or penalties
arising out of, based on or resulting from (i) the presence, or Release into the
environment, of any Hazardous Material at any location, whether or not owned by
such Person, or (ii) circumstances forming the basis of any violation, or
alleged violation, of any Environmental Law. The term "Environmental Claim"
shall include, without limitation, any written claim by any governmental
authority for enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any applicable Environmental Law, and any written claim
by any third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from the presence of
Hazardous Materials or arising from alleged injury or threat of injury to
health, safety or the environment.
CREDIT AGREEMENT
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"ENVIRONMENTAL LAWS" shall mean any and all present and future
Federal, state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the regulation
or protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the indoor or outdoor
environment, including, without limitation, ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.
"EQUITY ISSUANCE" shall mean (a) any issuance or sale by the
Company or any of its Subsidiaries after the Restatement Date of (i) any capital
stock, (ii) any warrants or options exercisable in respect of capital stock
(other than any warrants or options issued to directors, officers, employees,
agents, consultants or advisors of the Company or any of its Subsidiaries and
any capital stock of the Company issued upon the exercise of such warrants or
options) or (iii) any other security or instrument representing an equity
interest (or the right to obtain any equity interest) in the issuing or selling
Person or (b) the receipt by the Company or any of its Subsidiaries after
November 29, 1997 of any capital contribution (whether or not evidenced by any
equity security issued by the recipient of such contribution); PROVIDED that
Equity Issuance shall not include (x) any such issuance or sale by any
Subsidiary of the Company to the Company or any Wholly Owned Subsidiary of the
Company, (y) any capital contribution by the Company or any Wholly Owned
Subsidiary of the Company to any Subsidiary of the Company or (z) any such
issuance or sale by the Company in connection with a permitted Acquisition under
Section 8.05(b).
"EQUITY RIGHTS" shall mean, with respect to any Person, any
outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including, without limitation, any stockholders' or
voting trust agreements) for the issuance, sale, registration or voting of, or
outstanding securities convertible into, any additional shares of capital stock
of any class, or partnership or other ownership interests of any type in, such
Person.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time.
"ERISA AFFILIATE" shall mean any corporation or trade or business
that is a member of any group of organizations (i) described in Section 414(b)
or (c) of the Code of which the Company is a member and (ii) solely for purposes
of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11)
of the Code and the lien created under Section 302(f) of ERISA and Section
412(n) of the Code, described in Section 414(m) or (o) of the Code of which the
Company is a member.
"EURODOLLAR BASE RATE" shall mean, with respect to any Eurodollar
Loan for any Interest Period therefor, the arithmetic mean (rounded upwards, if
necessary, to the nearest 1/100 of 1%) of the respective rates per annum quoted
by each Reference Lender at approximately
CREDIT AGREEMENT
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11:00 a.m. London time (or as soon thereafter as practicable) on the date two
Business Days prior to the first day of such Interest Period for the offering by
such Reference Lender to leading banks in the London interbank market of Dollar
deposits having a term comparable to such Interest Period and in an amount
comparable to the principal amount of the Eurodollar Loan to be made by such
Reference Lender for such Interest Period. If any Reference Lender is not
participating in any Eurodollar Loan during any Interest Period therefor, the
Eurodollar Base Rate for such Loan for such Interest Period shall be determined
by reference to the amount of the Eurodollar Loan to be made by Chase for such
Interest Period.
"EURODOLLAR LOANS" shall mean Loans the interest rates on which
are determined on the basis of rates referred to in the definition of
"Eurodollar Base Rate" in this Section 1.01.
"EURODOLLAR RATE" shall mean, for any Eurodollar Loan for any
Interest Period therefor, a rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) determined by the Administrative Agent to be equal to
the Eurodollar Base Rate for such Loan for such Interest Period divided by 1
minus the Reserve Requirement for such Loan for such Interest Period.
"EVENT OF DEFAULT" shall have the meaning assigned to such term
in Section 9 hereof.
"EXISTING CREDIT AGREEMENT" shall have the meaning assigned to
such term in the recitals hereto.
"EXISTING LENDERS" shall mean the lenders party to the Existing
Credit Agreement.
"EXISTING LETTERS OF CREDIT" shall have the meaning assigned to
such term in Section 2.03(l) hereof.
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, PROVIDED that (a) if the day for which such rate is to
be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate charged to Chase on such Business Day on such
transactions as determined by the Administrative Agent.
"FISCAL DATE" shall mean the last day of each fiscal quarterly
period of the Company.
"FOREIGN SUBSIDIARY" shall mean each Subsidiary of the Company
other than any Domestic Subsidiary.
CREDIT AGREEMENT
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"FUNDED DEBT" shall mean, for any Person: (a) all Indebtedness of
such Person that should be reflected on a balance sheet of such Person in
accordance with GAAP; and (b) all Indebtedness of any other Person that should
be reflected on a balance sheet of such other Person in accordance with GAAP and
that is secured by a Lien on the Property of, is supported by a letter of credit
issued for account of, or is Guaranteed by, such Person.
"GAAP" shall mean generally accepted accounting principles
applied on a basis consistent with those which, in accordance with the last
sentence of Section 1.02(a) hereof, are to be used in making the calculations
for purposes of determining compliance with this Agreement.
"GE LEASE AGREEMENT" shall mean the Master Lease Agreement dated
as of October 20, 1997 between the Company and General Electric Capital
Corporation, for itself and as Agent for Certain Participants.
"GUARANTEE" shall mean a guarantee, an endorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms "GUARANTEE" and "GUARANTEED" used as a verb shall
have a correlative meaning.
"HAZARDOUS MATERIAL" shall mean, collectively, (a) any petroleum
or petroleum products, flammable explosives, radioactive materials, asbestos in
any form that is or could become friable, urea formaldehyde foam insulation, and
transformers or other equipment that contain dielectric fluid containing
polychlorinated biphenyls (PCB's), (b) any chemicals or other materials or
substances which are now or hereafter become defined as or included in the
definition of "hazardous substances", "hazardous wastes", "hazardous materials",
"extremely hazardous wastes", "restricted hazardous wastes", "toxic substances",
"toxic pollutants", "contaminants", "pollutants" or words of similar import
under any Environmental Law and (c) any other chemical or other material or
substance, exposure to which is now or hereafter prohibited, limited or
regulated under any Environmental Law.
"INDEBTEDNESS" shall mean, for any Person: (a) obligations
created, issued or incurred by such Person for borrowed money (whether by loan,
the issuance and sale of debt securities or the sale of Property to another
Person subject to an understanding or agreement, contingent or otherwise, to
repurchase such Property from such Person); (b) obligations of such Person to
pay the deferred purchase or acquisition price of Property or services, other
than trade accounts payable (other than for borrowed money) arising, and accrued
expenses incurred, in the ordinary course of business so long as such trade
accounts payable are payable within 90 days of
CREDIT AGREEMENT
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the date the respective goods are delivered or the respective services are
rendered; (c) Indebtedness of others secured by a Lien on the Property of such
Person, whether or not the respective indebtedness so secured has been assumed
by such Person; (d) obligations of such Person in respect of letters of credit
or similar instruments issued or accepted by banks and other financial
institutions for account of such Person; (e) Capital Lease Obligations of such
Person; and (f) Indebtedness of others Guaranteed by such Person.
"IN-FLIGHT" shall mean In-Flight Entertainment, LLC, a Delaware
limited liability company and Wholly Owned Subsidiary of the Company.
"IN-FLIGHT GUARANTEE AND SECURITY AGREEMENT" shall mean the
Amended and Restated Guarantee and Security Agreement dated as of the
Restatement Date between In-Flight and the Administrative Agent, substantially
in the form of Exhibit A-2 hereto, as the same shall be modified, supplemented
and in effect from time to time.
"INFORMATION MEMORANDUM" shall mean the Confidential Information
Memorandum dated March, 1998 distributed to the Lenders.
"INTEREST COVERAGE RATIO" shall mean, as at any date the ratio of
(i) EBITDA for the relevant Calculation Period to (ii) Interest Expense for such
Calculation Period; PROVIDED that, from and after the date of any Acquisition
occurring after February 28, 1998 until four full fiscal quarters of the Company
have elapsed since the date of such Acquisition, the Interest Coverage Ratio
shall be calculated on a PRO FORMA basis (reflecting, INTER ALIA, any amount
attributable to any operating expense that will be eliminated or cost reduction
that will be realized (in each case, net of any operating expense or other cost
increase) in connection with such Acquisition, as determined in good faith by
the chief financial officer of the Company in accordance with GAAP and the
rules, regulations and guidelines of the Securities and Exchange Commission, as
if such elimination of operating expense or the realization of such cost
reductions were achieved at the beginning of such four-quarter period) as though
such Acquisition had occurred, and any Funded Debt incurred or assumed by the
Company or any of its Subsidiaries in connection with, or in anticipation of,
such Acquisition had been incurred or assumed, on the first day of such
Calculation Period.
"INTEREST EXPENSE" shall mean, for any period, the sum, for the
Company and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of the following: (a) all interest in
respect of Indebtedness accrued or capitalized during such period (whether or
not actually paid during such period) PLUS (b) the net amounts payable (or MINUS
the net amounts receivable) under Interest Rate Protection Agreements accrued
during such period (whether or not actually paid or received during such period)
MINUS (c) interest income during such period.
"INTEREST PERIOD" shall mean, with respect to any Eurodollar
Loan, each period commencing on the date such Eurodollar Loan is made or
Converted from a Base Rate Loan or the last day of the next preceding Interest
Period for such Loan and ending on the numerically corresponding day in the
first, second, third or sixth calendar month thereafter, as the Company
CREDIT AGREEMENT
15
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may select as provided in Section 4.05 hereof, except that each Interest Period
that commences on the last Business Day of a calendar month (or on any day for
which there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Business Day of the appropriate subsequent
calendar month. Notwithstanding the foregoing: (i) no Interest Period for any
Series A Loan may end after the Series A Commitment Termination Date; (ii) no
Interest Period for any Series B Loan may commence before and end after any
Series B Principal Payment Date unless, after giving effect thereto, the
aggregate principal amount of the Series B Loans having Interest Periods that
end after such Series B Principal Payment Date shall be equal to or less than
the aggregate principal amount of the Series B Loans scheduled to be outstanding
after giving effect to the payments of principal required to be made on such
Series B Principal Payment Date; (iii) each Interest Period that would otherwise
end on a day which is not a Business Day shall end on the next succeeding
Business Day (or, if such next succeeding Business Day falls in the next
succeeding calendar month, on the next preceding Business Day); and (iv)
notwithstanding clauses (i) and (ii) above, no Interest Period shall have a
duration of less than one month and, if the Interest Period for any Eurodollar
Loan would otherwise be a shorter period, such Eurodollar Loan shall not be
available hereunder for such period.
"INTEREST RATE PROTECTION AGREEMENT" shall mean, for any Person,
an interest rate swap, cap or collar agreement or similar arrangement between
such Person and one or more financial institutions providing for the transfer or
mitigation of interest risks either generally or under specific contingencies.
For purposes hereof, the "CREDIT EXPOSURE" at any time of any Person under an
Interest Rate Protection Agreement to which such Person is a party shall be
determined at such time in accordance with the standard methods of calculating
credit exposure under similar arrangements as prescribed from time to time by
the Administrative Agent, taking into account potential interest rate movements
and the respective termination provisions and notional principal amount and term
of such Interest Rate Protection Agreement.
"INVESTMENT" shall mean, for any Person: (a) the acquisition
(whether for cash, Property, services or securities or otherwise) of capital
stock, bonds, notes, debentures, partnership or other ownership interests or
other securities of, or capital contribution to, any other Person or any
agreement to make any such acquisition or capital contribution (including,
without limitation, any "short sale" or any sale of any securities at a time
when such securities are not owned by the Person entering into such short sale);
(b) the making of any deposit with, or advance, loan or other extension of
credit to, any other Person (including the purchase of Property from another
Person subject to an understanding or agreement, contingent or otherwise, to
resell such Property to such Person, but excluding any such advance, loan or
extension of credit having a term not exceeding 90 days representing the
purchase price of inventory or supplies sold by such Person in the ordinary
course of business); (c) the entering into of any Guarantee of, or other
contingent obligation with respect to, Indebtedness or other liability of any
other Person and (without duplication) any amount committed to be advanced, lent
or extended to such Person; or (d) the entering into of any Interest Rate
Protection Agreement.
"ISSUING LENDER" shall mean Chase, as the issuer of Letters of
Credit under Section 2.03 hereof, together with its successors and assigns in
such capacity.
CREDIT AGREEMENT
16
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"LETTER OF CREDIT" shall have the meaning assigned to such term
in Section 2.03 hereof.
"LETTER OF CREDIT DOCUMENTS" shall mean, with respect to any
Letter of Credit, collectively, any application therefor and any other
agreements, instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or providing
for (a) the rights and obligations of the parties concerned or at risk with
respect to such Letter of Credit or (b) any collateral security for any of such
obligations, each as the same may be modified and supplemented and in effect
from time to time.
"LETTER OF CREDIT INTEREST" shall mean, for each Series A Lender,
such Lender's participation interest (or, in the case of the Issuing Lender, the
Issuing Lender's retained interest) in the Issuing Lender's liability under
Letters of Credit and such Lender's rights and interests in Reimbursement
Obligations and fees, interest and other amounts payable in connection with
Letters of Credit and Reimbursement Obligations.
"LETTER OF CREDIT LIABILITY" shall mean, without duplication, at
any time and in respect of any Letter of Credit, the sum of (a) the undrawn
amount of such Letter of Credit PLUS (b) the aggregate unpaid principal amount
of all Reimbursement Obligations of the Company at such time due and payable in
respect of all drawings made under such Letter of Credit. For purposes of this
Agreement, a Series A Lender (other than the Issuing Lender) shall be deemed to
hold a Letter of Credit Liability in an amount equal to its participation
interest in the related Letter of Credit under Section 2.03 hereof, and the
Issuing Lender shall be deemed to hold a Letter of Credit Liability in an amount
equal to its retained interest in the related Letter of Credit after giving
effect to the acquisition by the Series A Lenders other than the Issuing Lender
of their participation interests under said Section 2.03.
"LEVEL I PERIOD" shall mean any period during which (a) no Event
of Default shall have occurred and be continuing, and (b) the Leverage Ratio is
less than 2.25 to 1; "LEVEL II PERIOD" shall mean any period, other than a Level
I Period, during which (a) no Event of Default shall have occurred and be
continuing and (b) the Leverage Ratio is greater than or equal to 2.25 to 1 but
less than 2.75 to 1; "LEVEL III PERIOD" shall mean any period, other than a
Level I Period or a Level II Period, during which (a) no Event of Default shall
have occurred and be continuing and (b) the Leverage Ratio is greater than or
equal to 2.75 to 1 but less than 3.25 to 1; "LEVEL IV PERIOD" shall mean any
period, other than a Level I Period, a Level II Period or a Level III Period
during which (a) no Event of Default shall have occurred and be continuing and
(b) the Leverage Ratio is greater than or equal to 3.25 to 1 but less than 3.75
to 1; "LEVEL V PERIOD" shall mean any period, other than a Level I Period, a
Level II Period, a Level III Period or Level IV Period during which (a) no Event
of Default shall have occurred and be continuing and (b) the Leverage Ratio is
greater than or equal to 3.75 to 1 but less than 4.25 to 1; "LEVEL VI PERIOD"
shall mean any period that is not a Level I Period, a Level II Period, a Level
III Period, a Level IV Period or a Level V Period during which (a) no Event of
Default shall have occurred and be continuing and (b) the Leverage Ratio is
greater than or equal to 4.25 to 1 but less than 4.75; and "LEVEL VII PERIOD"
shall mean any period that is not a Level I Period, a Level II Period, a Level
III Period, a Level IV Period, a Level V Period or a Level VI Period. Any change
in the Applicable Margin
CREDIT AGREEMENT
17
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for any Type of Loan or any change in the Commitment Fee by reason of a change
in the Leverage Ratio shall become effective on the third Business Day following
receipt by the Administrative Agent of the financial statements of the Company
and its Subsidiaries delivered as required by Sections 8.01(a), (b) or (h)
hereof; PROVIDED that failure to deliver such financial statements as required
by Sections 8.01(a), (b) or (h) hereof shall result in the Applicable Margin and
Commitment Fee Rate being at the rates set forth opposite Level VII Period.
"LEVERAGE RATIO" shall mean, as at any date, the ratio of Total
Funded Debt at such date to EBITDA for the relevant Calculation Period; PROVIDED
that, from and after the date of any Acquisition occurring after February 28,
1998 until four full fiscal quarters of the Company shall have elapsed since the
date of such Acquisition, the Leverage Ratio shall be calculated on a PRO FORMA
basis (reflecting, INTER ALIA, any amount attributable to any operating expense
that will be eliminated or cost reduction that will be realized (in each case,
net of any operating expense or other cost increase) in connection with such
Acquisition, as determined in good faith by the chief financial officer of the
Company in accordance with GAAP and the rules, regulations and guidelines of the
Securities and Exchange Commission, as if such elimination of operating expense
or the realization of such cost reductions were achieved at the beginning of
such four-quarter period") as though such Acquisition had occurred, any Funded
Debt incurred or assumed by the Company or any of its Subsidiaries in connection
with, or in anticipation of, such Acquisition had been incurred or assumed, on
the first day of such Calculation Period.
"LIEN" shall mean, with respect to any Property, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this Agreement and the other Basic Documents, a
Person shall be deemed to own subject to a Lien any Property that it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
(other than an operating lease) relating to such Property.
"LOANS" shall mean the Series A Loans and the Series B Loans.
"MAJORITY LENDERS" shall mean Majority Series A Lenders and
Majority Series B Lenders.
"MAJORITY SERIES A LENDERS" shall mean Series A Lenders having
more than 50% of the aggregate amount of the Series A Commitments or, if the
Series A Commitments shall have terminated, Lenders holding more than 50% of the
sum of (a) the aggregate unpaid principal amount of the Series A Loans PLUS (b)
the aggregate amount of all Letter of Credit Liabilities.
"MAJORITY SERIES B LENDERS" shall mean Series B Lenders having
more than 50% of the aggregate amount of the Series B Commitments or, if the
Series B Commitments shall have terminated, Lenders holding more than 50% of the
aggregate unpaid principal amount of the Series B Loans.
CREDIT AGREEMENT
18
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"MARGIN STOCK" shall mean "margin stock" within the meaning of
Regulations U and X.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on
(a) the Property, business, operations, financial condition, prospects,
liabilities or capitalization of the Company and its Subsidiaries taken as a
whole, (b) the ability of the Company to perform its obligations under any of
the Basic Documents to which it is a party, (c) the validity or enforceability
of any of the Basic Documents, (d) the rights and remedies of the Lenders and
the Administrative Agent under any of the Basic Documents or (e) the timely
payment of the principal of or interest on the Loans or the Reimbursement
Obligations or other amounts payable in connection therewith.
"MATERIAL SUBSIDIARY" shall mean at any date any Subsidiary of
the Company whose total assets equal or exceed 2% of the total assets of the
Company and its Subsidiaries on a consolidated basis as at the most recent
Fiscal Date; PROVIDED that, notwithstanding the above, each of B/E Services and
Royal Inventum B.V. shall at all times constitute a Material Subsidiary of the
Company so long as it is a Subsidiary of the Company.
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan defined as
such in Section 3(37) of ERISA to which contributions have been made by the
Company or any ERISA Affiliate and which is covered by Title IV of ERISA.
"NET AVAILABLE PROCEEDS" shall mean:
(i) in the case of any Disposition, the amount of Net Cash
Payments received in connection with such Disposition;
(ii) in the case of any Casualty Event, the aggregate amount of
proceeds of insurance, condemnation awards and other compensation
received by the Company and its Subsidiaries in respect of such Casualty
Event net of (A) reasonable expenses incurred by the Company and its
Subsidiaries in connection therewith and (B) contractually required
repayments of Indebtedness to the extent secured by a Lien on such
Property and any income and transfer taxes payable by the Company or any
of its Subsidiaries in respect of such Casualty Event;
(iii) in the case of any Equity Issuance, the aggregate amount of
all cash received by the Company and its Subsidiaries in respect of such
Equity Issuance net of reasonable expenses incurred by the Company and
its Subsidiaries in connection therewith; and
(iv) in the case of any Reversion, the aggregate amount of all
cash received by the Company or any of its Subsidiaries in respect of
such Reversion net of (A) reasonable expenses incurred by the Company
and its Subsidiaries in connection therewith and (B) any income and
excise taxes payable by the Company or any of its Subsidiaries in
respect of such Reversion.
CREDIT AGREEMENT
19
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"NET CASH PAYMENTS" shall mean, with respect to any Disposition,
the aggregate amount of all cash payments, and the fair market value of any
non-cash consideration, received by the Company and its Subsidiaries directly or
indirectly in connection with such Disposition; PROVIDED that (a) Net Cash
Payments shall be net of (i) the amount of any legal, accounting and other
professional fees, title and recording tax expenses, commissions and other fees
and expenses paid by the Company and its Subsidiaries in connection with such
Disposition and (ii) any Federal, state and local income or other taxes
estimated to be payable by the Company and its Subsidiaries as a result of such
Disposition (but only to the extent that such estimated taxes are in fact paid
to the relevant Federal, state or local governmental authority within three
months of date of such Disposition or the Company or any of its Subsidiaries
uses any applicable tax benefit available to it as set forth on its balance
sheet to reduce such estimated taxes payable within such three month period),
(b) Net Cash Payments shall not include any cash payments of less than $100,000
from any one Disposition or a series of related Dispositions, and (c) Net Cash
Payments shall be net of any repayments by the Company or any of its
Subsidiaries of Indebtedness to the extent that (i) such Indebtedness is secured
by a Lien on the Property that is the subject of such Disposition and (ii) the
transferee of (or holder of a Lien on) such Property requires that such
Indebtedness be repaid as a condition to the purchase of such Property.
"NOTES" shall mean the promissory notes (if any) executed and
delivered by the Company pursuant to Section 2.08 hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"PERMITTED INVESTMENTS" shall mean any Investment in (i) direct
obligations of the United States of America or any agency thereof, or
obligations guaranteed by the United States of America, or of any agency
thereof; (ii) commercial paper rated at least A-1 by S&P or P-1 by Xxxxx'x;
(iii) time deposits with, including certificates of deposit issued by, any
office located in the United States of America of any bank or trust company
which is organized under the laws of the United States of America or any state
thereof and has capital, surplus and undivided profits aggregating at least
$1,000,000,000; (iv) shares of any money market or mutual fund not less than 80%
of the assets of which are invested solely in securities or obligations of the
type described in clauses (i) through (iii) above and (v) repurchase agreements
with respect to securities described in clause (i) above entered into with an
office of a bank or trust company meeting the criteria specified in clause (iii)
above, PROVIDED in each case that such Investment matures within one year from
the date of acquisition thereof by the Company or a Subsidiary of the Company.
"PERSON" shall mean any individual, corporation, company,
voluntary association, partnership, joint venture, trust, unincorporated
organization or government (or any agency, instrumentality or political
subdivision thereof).
"PLAN" shall mean an employee benefit plan established or
maintained by the Company or any ERISA Affiliate and that is covered by Title IV
of ERISA, other than a Multiemployer Plan.
CREDIT AGREEMENT
20
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"POST-DEFAULT RATE" shall mean, in respect of any principal of
any Loan, any Reimbursement Obligation or any other amount under this Agreement,
any Note or any other Basic Document that is not paid when due (whether at
stated maturity, by acceleration, by optional or mandatory prepayment or
otherwise), a rate per annum during the period from and including the due date
to but excluding the date on which such amount is paid in full equal to 2% PLUS
the Base Rate as in effect from time to time PLUS the Applicable Margin for Base
Rate Loans (PROVIDED that, if the amount so in default is principal of a
Eurodollar Loan and the due date thereof is a day other than the last day of the
Interest Period therefor, the "Post-Default Rate" for such principal shall be,
for the period for and including such due date to but excluding the last day of
the Interest Period, 2% PLUS the interest rate for such Loan as provided in
Section 3.02 hereof and, thereafter, the rate provided for above in this
definition).
"PRIME RATE" shall mean the rate of interest from time to time
announced by Chase at the Principal Office as its prime commercial lending rate.
"PRINCIPAL OFFICE" shall mean the principal office of Chase,
located on the date hereof at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"PROPERTY" shall mean any right or interest in or to property of
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"QUARTERLY DATES" shall mean the quarterly anniversaries of the
Restatement Date; PROVIDED that, if any such date is not a Business Day, the
Quarterly Date shall be the next succeeding Business Day (or, if such next
succeeding Business Day falls in the next succeeding calendar month, the next
preceding Business Day).
"RECAPTURE DATE" shall mean the last day of the Recapture Period.
"RECAPTURE PERIOD" shall mean each period (a) commencing on the
later of (i) the Restatement Date and (ii) the day immediately following the
last day of the immediately preceding Recapture Period, and (b) ending on the
date on which the Company and/or its Subsidiaries receives Net Available
Proceeds which, together with all Net Available Proceeds received since the
first day of such Recapture Period, equal or exceeds in the aggregate
$1,000,000.
"REFERENCE LENDERS" shall mean Chase and NationsBank, N.A.
"REGULATIONS A, D, U AND X" shall mean, respectively, Regulations
A, D, U and X of the Board of Governors of the Federal Reserve System (or any
successor), as the same may be modified and supplemented and in effect from time
to time.
"REGULATORY CHANGE" shall mean, with respect to any Lender, any
change after the date of this Agreement in Federal, state or foreign law or
regulations (including, without limitation, Regulation D) or the adoption or
making after such date of any interpretation,
CREDIT AGREEMENT
21
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directive or request applying to a class of banks including such Lender of or
under any Federal, state or foreign law or regulations (whether or not having
the force of law and whether or not failure to comply therewith would be
unlawful) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"REIMBURSEMENT OBLIGATIONS" shall mean, at any time, the
obligations of the Company then outstanding, or which may thereafter arise in
respect of all Letters of Credit then outstanding, to reimburse amounts paid by
the Issuing Lender in respect of any drawings under a Letter of Credit.
"RELEASE" shall mean any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment, including, without limitation,
the movement of Hazardous Materials through ambient air, soil, surface water,
groundwater, wetlands, land or subsurface strata. The terms "RELEASE" and
"RELEASED" used as a verb shall have a correlative meaning.
"RESERVE REQUIREMENT" shall mean, for any Interest Period for any
Eurodollar Loan, the average maximum rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member banks of the
Federal Reserve System in New York City with deposits exceeding one billion
Dollars against "Eurocurrency liabilities" (as such term is used in Regulation
D). Without limiting the effect of the foregoing, the Reserve Requirement shall
include any other reserves required to be maintained by such member banks by
reason of any Regulatory Change with respect to (i) any category of liabilities
that includes deposits by reference to which the Eurodollar Base Rate is to be
determined as provided in the definition of "Eurodollar Base Rate" in this
Section 1.01 or (ii) any category of extensions of credit or other assets that
includes Eurodollar Loans.
"RESTATEMENT DATE" shall mean April 3, 1998.
"RESTRICTED PAYMENT" shall mean, with respect to any Person, (a)
dividends (in cash, Property or obligations) on, or other payments or
distributions on account of, or the setting apart of money for a sinking or
other analogous fund for, or the purchase, redemption, retirement or other
acquisition of, any shares of any class of stock of such Person or of any
warrants (other than of shares of common stock, warrants or options of such
Person as payment for the exercise price of options or warrants to purchase
common stock of such Person having a fair market value equal to such exercise
price), options or other rights to acquire the same (or to make any payments to
any other Person, such as "phantom stock" payments, where the amount thereof is
calculated with reference to the fair market or equity value of such Person or
any of its Subsidiaries), but excluding dividends payable solely in shares of
common stock or in options, warrants or other rights to purchase such common
stock of such Person or (b) any payment (whether made by such Person or any of
its Subsidiaries) on account of the purchase, redemption, prepayment, defeasance
or other acquisition or retirement of value of any Indebtedness (such
Indebtedness, "RETIRED INDEBTEDNESS") that is subordinated in right of payment
to the prior payment of the Loans, except any such payment made from the
proceeds of
CREDIT AGREEMENT
22
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(x) the issuance of any equity securities or (y) any additional unsecured
Indebtedness that does not rank senior in right of payment to, and does not
mature or have any mandatory prepayment, which does not include required
prepayments as a result of a change of control or asset sale, prior to the
maturity of, such Retired Indebtedness.
"REVERSION" shall mean the termination by the Company or any of
its Subsidiaries of a Plan which results in a payment to the Company or any of
its Subsidiaries of any part of the over-funded portion of such Plan.
"SECURITIES EXCHANGE ACT" shall mean the Securities Exchange Act
of 1934, as amended.
"SECURITY AGREEMENT" shall mean the Amended and Restated Security
Agreement dated as of the Restatement Date between the Company and the
Administrative Agent, substantially in the form of Exhibit A-1 hereto, as the
same shall be modified, supplemented and in effect from time to time.
"SECURITY DOCUMENTS" shall mean, collectively, the Security
Agreement and the In-Flight Guarantee and Security Agreement.
"SENIOR SUBORDINATED INDENTURES" shall mean the Senior
Subordinated 1996 Indenture and the Senior Subordinated 1998 Indenture.
"SENIOR SUBORDINATED 1996 INDENTURE" shall mean the Indenture
dated as of February 1, 1996 between the Company and Fleet National Bank
Connecticut, N.A., as Trustee, as the same shall be modified and supplemented
and in effect from time to time.
"SENIOR SUBORDINATED 1998 INDENTURE" shall mean the Indenture
dated as of February 13, 1998 between the Company and United States Trust
Company of New York as Trustee, as the same shall be modified and supplemented
and in effect from time to time.
"SERIES A COMMITMENT" shall mean, for each Series A Lender, the
obligation of such Lender to make Series A Loans in an aggregate amount at any
one time outstanding up to but not exceeding the amount set opposite the name of
such Lender on Annex 1 hereto under the caption "Series A Commitment" (as the
same may be reduced from time to time pursuant to Section 2.04 hereof or
increased or reduced from time to time pursuant to Section 11.06 hereof). The
original aggregate principal amount of the Series A Commitments is $100,000,000.
"SERIES A COMMITMENT PERCENTAGE" shall mean, with respect to any
Series A Lender, the ratio of (a) the amount of the Series A Commitment of such
Lender to (b) the aggregate amount of the Series A Commitments of all of the
Lenders.
"SERIES A COMMITMENT TERMINATION DATE" shall mean the sixth
anniversary of the Restatement Date; PROVIDED that if such day is not a Business
Day, the Series A Commitment Termination Date shall be the immediately preceding
Business Day.
CREDIT AGREEMENT
23
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"SERIES A LENDERS" shall mean (a) on the Amendment Effective
Date, the Lenders having Series A Commitments as indicated on Annex 1 hereto and
(b) thereafter, the Lenders from time to time holding Series A Loans and Series
A Commitments after giving effect to any assignments thereof permitted by
Section 11.06 hereof.
"SERIES A LOANS" shall mean the loans provided for by Section
2.01(a) hereof, which may be Base Rate Loans and/or Eurodollar Loans.
"SERIES A NOTES" shall mean the promissory notes (if any)
provided for by Section 2.08(a) hereof and all promissory notes delivered in
substitution or exchange therefor, in each case as the same shall be modified
and supplemented and in effect from time to time.
"SERIES B COMMITMENT" shall mean, for each Series B Lender, the
obligation of such Lender to make Series B Loans in an aggregate amount at any
one time outstanding up to but not exceeding the amount set opposite the name of
such Lender on Annex 1 hereto under the caption "Series B Commitment" (as the
same may be reduced from time to time pursuant to Section 2.04 hereof or
increased or reduced from time to time pursuant to Section 11.06 hereof). The
original aggregate principal amount of the Series B Commitments is $100,000,000.
"SERIES B COMMITMENT TERMINATION DATE" shall mean the date 364
days after the Restatement Date; PROVIDED that if such day is not a Business
Day, the Series B Commitment Termination Date shall be the immediately preceding
Business Day.
"SERIES B LENDERS" shall mean (a) on the Amendment Effective
Date, the Lenders having Series B Commitments as indicated on Annex 1 hereto and
(b) thereafter, the Lenders from time to time holding Series B Loans and Series
B Commitments after giving effect to any assignments thereof permitted by
Section 11.06 hereof.
"SERIES B LOANS" shall mean the loans provided for by Section
2.01(b) hereof, which may be Base Rate Loans and/or Eurodollar Loans.
"SERIES B NOTES" shall mean the promissory notes provided for by
Section 2.08(b) hereof and all promissory notes delivered in substitution or
exchange therefor, in each case as the same shall be modified and supplemented
and in effect from time to time.
"SERIES B PRINCIPAL PAYMENT DATE" shall mean any Quarterly Date
on which payments of principal of Series B Loan are scheduled to be made
pursuant to Section 3.01(b) hereof.
"SPECIFIED SUBSIDIARY" shall mean each Subsidiary of the Company
identified as a "Specified Subsidiary" on Schedule III hereto, but only until
all (or, in the case of a Subsidiary that is not a Domestic Subsidiary, 65%) of
its shares that are owned by the Company become subject to the Lien of the
Security Agreement or are otherwise pledged to the Administrative
CREDIT AGREEMENT
24
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Agent for the benefit of the Lenders pursuant to documentation in form and
substance reasonably satisfactory to the Majority Lenders.
"SUBSIDIARY" shall mean, for any Person, any corporation,
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other
class or classes of such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned or controlled by such Person or one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person. "WHOLLY OWNED SUBSIDIARY" shall mean any such corporation,
partnership or other entity of which all of the equity securities or other
ownership interests (other than, in the case of a corporation, directors'
qualifying shares) are so owned or controlled.
"TOTAL FUNDED DEBT" shall mean, as at any date, the sum, for the
Company and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP), of all Funded Debt.
"TYPE" shall have the meaning assigned to such term in Section
1.03 hereof.
1.02 ACCOUNTING TERMS AND DETERMINATIONS.
(a) Except as otherwise expressly provided herein, all accounting
terms used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to the
Lenders hereunder shall (unless otherwise disclosed to the Lenders in writing at
the time of delivery thereof in the manner described in subsection (b) below) be
prepared, in accordance with generally accepted accounting principles applied on
a basis consistent with those used in the preparation of the latest financial
statements furnished to the Lenders hereunder (which, prior to the delivery of
the first financial statements under Section 8.01 hereof, shall mean the audited
financial statements as at February 22, 1997 referred to in Section 7.02
hereof). All calculations made for the purposes of determining compliance with
this Agreement shall (except as otherwise expressly provided herein) be made by
application of generally accepted accounting principles applied on a basis
consistent with those used in the preparation of the latest annual or quarterly
financial statements furnished to the Lenders pursuant to Section 8.01 hereof
(or, prior to the delivery of the first financial statements under Section 8.01
hereof, used in the preparation of the audited financial statements as at
February 22, 1997, referred to in Section 7.02 hereof) unless (i) the Company
shall have objected to determining such compliance on such basis at the time of
delivery of such financial statements or (ii) the Majority Lenders shall so
object in writing within 30 days after delivery of such financial statements, in
either of which events such calculations shall be made on a basis consistent
with those used in the preparation of the latest financial statements as to
which such objection shall not have been made (which, if objection is made in
respect of the first financial statements delivered under Section 8.01 hereof,
shall mean the audited financial statements as at February 22, 1997 referred to
in Section 7.02 hereof).
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(b) The Company shall deliver to the Lenders at the same time as
the delivery of any annual or quarterly financial statement under Section 8.01
hereof (i) a description in reasonable detail of any material variation between
the application of accounting principles employed in the preparation of such
statement and the application of accounting principles employed in the
preparation of the next preceding annual or quarterly financial statements as to
which no objection has been made in accordance with the last sentence of
subsection (a) above and (ii) reasonable estimates of the difference between
such statements arising as a consequence thereof.
(c) To enable the ready and consistent determination of
compliance with the covenants set forth in Section 8 hereof, the fiscal year of
the Company shall end on the last Saturday in February of each year, and the
last days of the first three fiscal quarters shall fall on the last Saturday in
each of May, August and November of each year, respectively.
1.03 CLASSES AND TYPES OF LOANS.
Loans hereunder are distinguished by "Class" and by "Type". The "Class" of a
Loan (or of a Commitment to make a Loan) refers to whether such Loan is a Series
A Loan or a Series B Loan, each of which constitutes a Class. The "Type" of a
Loan refers to whether such Loan is a Base Rate Loan or a Eurodollar Loan, each
of which constitutes a Type. Loans may be identified by both Class and Type.
Section 2. COMMITMENTS, LOANS, NOTES AND PREPAYMENTS.
2.01 LOANS.
(a) SERIES A LOANS. Each Series A Lender severally agrees, on the
terms and conditions of this Agreement, to make loans to the Company in Dollars
to but not including the Series A Commitment Termination Date in an aggregate
principal amount at any one time outstanding up to but not exceeding the amount
of the Series A Commitment of such Lender as in effect from time to time (such
Loans, together with the "Series A Loans" made under the Existing Credit
Agreement, being herein called "SERIES A LOANS"), PROVIDED that in no event
shall the aggregate principal amount of all Series A Loans, together with the
aggregate amount of all Letter of Credit Liabilities, exceed the aggregate
amount of the Series A Commitments. Subject to the terms and conditions of this
Agreement, the Company may borrow, repay and reborrow the amount of the Series A
Commitments by means of Base Rate Loans and Eurodollar Loans and may Convert
Series A Loans of one Type into Series A Loans of another Type (as provided in
Section 2.09 hereof).
(b) SERIES B LOANS. Each Series B Lender severally agrees, on the
terms and conditions of this Agreement, to make loans to the Company in Dollars
to but not including the Series B Commitment Termination Date in an aggregate
principal amount up to but not exceeding the amount of the Series B Commitment
of such Lender as in effect from time to time (such Loans being herein called
"SERIES B LOANS"). Subject to the terms and conditions of this Agreement, the
Company may borrow the amount of the Series B Commitments by means of
CREDIT AGREEMENT
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Base Rate Loans and Eurodollar Loans and may Convert Series B Loans of one Type
into Series B Loans of another Type (as provided in Section 2.09 hereof) or
Continue Series B Loans of one Type as Series B Loans of the same Type (as
provided in Section 2.09 hereof). Series B Loans may be prepaid, but they may
not be reborrowed once prepaid.
(c) LIMIT ON EURODOLLAR LOANS. No more than six separate Interest
Periods in respect of Eurodollar Loans of either Class from each Lender may be
outstanding at any one time.
2.02 BORROWINGS. The Company shall give the Administrative Agent
(which shall promptly notify the Lenders) notice of each borrowing hereunder as
provided in Section 4.05 hereof. Not later than 1:00 p.m. New York time on the
date specified for each borrowing hereunder, each Lender shall make available
the amount of the Loan or Loans to be made by it on such date to the
Administrative Agent, to the account of the Administrative Agent most recently
designated by it for such purpose by notice to the Lenders, in immediately
available funds, for account of the Company. The amount so received by the
Administrative Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Company by depositing the same, in
immediately available funds, in an account of the Company maintained with Chase
at the Principal Office designated by the Company.
2.03 LETTERS OF CREDIT. Subject to the terms and conditions of
this Agreement, the Series A Commitments may be utilized, upon the request of
the Company, in addition to the Series A Loans provided for by Section 2.01(a)
hereof, by the issuance by the Issuing Lender of letters of credit
(collectively, "LETTERS OF CREDIT") for account of the Company or any of its
Subsidiaries (as specified by the Company), PROVIDED that in no event shall (i)
the aggregate amount of all Letter of Credit Liabilities, together with the
aggregate principal amount of the Series A Loans, exceed the aggregate amount of
the Series A Commitments as in effect from time to time, (ii) the outstanding
aggregate amount of all Letter of Credit Liabilities exceed $15,000,000 and
(iii) the expiration date of any Letter of Credit extend beyond the earlier of
the Series A Commitment Termination Date and the date twelve months following
the issuance of such Letter of Credit. The following additional provisions shall
apply to Letters of Credit:
(a) The Company shall give the Administrative Agent at least
three Business Days' irrevocable prior notice (effective upon receipt)
specifying the Business Day (which shall be no later than thirty days preceding
the Series A Commitment Termination Date) each Letter of Credit is to be issued
and the account party or parties therefor and describing in reasonable detail
the proposed terms of such Letter of Credit (including the beneficiary thereof)
and the nature of the transactions or obligations proposed to be supported
thereby (including whether such Letter of Credit is to be a commercial letter of
credit or a standby letter of credit). Upon receipt of any such notice, the
Administrative Agent shall advise the Issuing Lender of the contents thereof.
(b) On each day during the period commencing with the issuance by
the Issuing Lender of any Letter of Credit and until such Letter of Credit shall
have expired or been terminated, the Series A Commitment of each Series A Lender
shall be deemed to be utilized for
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all purposes of this Agreement in an amount equal to such Lender's Series A
Commitment Percentage of the then undrawn face amount of such Letter of Credit.
Each Series A Lender (other than the Issuing Lender) agrees that, upon the
issuance of any Letter of Credit hereunder, it shall automatically acquire a
participation in the Issuing Lender's liability under such Letter of Credit in
an amount equal to such Lender's Series A Commitment Percentage of such
liability, and each Series A Lender (other than the Issuing Lender) thereby
shall absolutely, unconditionally and irrevocably assume, as primary obligor and
not as surety, and shall be unconditionally obligated to the Issuing Lender to
pay and discharge when due, its Series A Commitment Percentage of the Issuing
Lender's liability under such Letter of Credit.
(c) Upon receipt from the beneficiary of any Letter of Credit of
any demand for payment under such Letter of Credit, the Issuing Lender shall
promptly notify the Company (through the Administrative Agent) of the amount to
be paid by the Issuing Lender as a result of such demand and the date on which
payment is to be made by the Issuing Lender to such beneficiary in respect of
such demand. Notwithstanding the identity of the account party of any Letter of
Credit, the Company hereby unconditionally agrees to pay and reimburse the
Administrative Agent for account of the Issuing Lender for the amount of each
demand for payment under such Letter of Credit at or prior to the date on which
payment is to be made by the Issuing Lender to the beneficiary thereunder,
without presentment, demand, protest or other formalities of any kind.
(d) Forthwith upon its receipt of a notice referred to in clause
(c) of this Section 2.03, the Company shall advise the Administrative Agent
whether or not the Company intends to borrow hereunder to finance its obligation
to reimburse the Issuing Lender for the amount of the related demand for payment
and, if it does, submit a notice of such borrowing as provided in Section 4.05
hereof. In the event that the Company fails to so advise the Administrative
Agent, or if the Company fails to reimburse the Issuing Lender for a demand for
payment under a Letter of Credit by the date of such payment, the Administrative
Agent shall give each Series A Lender prompt notice of the amount of the demand
for payment, specifying such Lender's Series A Commitment Percentage of the
amount of the related demand for payment.
(e) Each Series A Lender (other than the Issuing Lender) shall
pay to the Administrative Agent for account of the Issuing Lender at the
Principal Office in Dollars and in immediately available funds, the amount of
such Lender's Series A Commitment Percentage of any payment under a Letter of
Credit upon notice by the Issuing Lender (through the Administrative Agent) to
such Series A Lender requesting such payment and specifying such amount;
PROVIDED that such Series A Lender shall not be obligated to reimburse the
Issuing Bank if such payment is the result of the willful misconduct or gross
negligence of the Issuing Bank in determining that the request or demand for
such payment complied with the terms of such Letter of Credit. Each such Series
A Lender's obligation to make such payments to the Administrative Agent for
account of the Issuing Lender under this clause (e), and the Issuing Lender's
right to receive the same, shall be absolute and unconditional and shall not be
affected by any circumstance whatsoever, including, without limitation, (i) the
failure of any other Series A Lender to make its payment under this clause (e),
the financial condition of the Company (or any
CREDIT AGREEMENT
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other account party), the existence of any Default or (ii) the termination of
the Commitments. Each such payment to the Issuing Lender shall be made without
any offset, abatement, withholding or reduction whatsoever. If any Series A
Lender shall default in its obligation to make any such payment to the
Administrative Agent for account of the Issuing Lender, for so long as such
default shall continue the Administrative Agent shall at the request of the
Issuing Bank withhold from any payments received by the Administrative Agent
under this Agreement or any Note for account of such Series A Lender the amount
so in default and the Administrative Agent shall pay the same to the Issuing
Lender in satisfaction of such defaulted obligation.
(f) Upon the making of each payment by a Series A Lender to the
Issuing Lender pursuant to clause (e) above in respect of any Letter of Credit,
such Lender shall, automatically and without any further action on the part of
the Administrative Agent, the Issuing Lender or such Lender, acquire (i) a
participation in an amount equal to such payment in the Reimbursement Obligation
owing to the Issuing Lender by the Company hereunder and under the Letter of
Credit Documents relating to such Letter of Credit and (ii) a participation in a
percentage equal to such Lender's Series A Commitment Percentage in any interest
or other amounts payable by the Company hereunder and under such Letter of
Credit Documents in respect of such Reimbursement Obligation (other than the
commissions, charges, costs and expenses payable to the Issuing Lender pursuant
to clause (g) of this Section 2.03). Upon receipt by the Issuing Lender from or
for account of the Company of any payment in respect of any Reimbursement
Obligation or any such interest or other amount (including by way of setoff or
application of proceeds of any collateral security) the Issuing Lender shall
promptly pay to the Administrative Agent for account of each Series A Lender
entitled thereto, such Series A Lender's Series A Commitment Percentage of such
payment, each such payment by the Issuing Lender to be made in the same money
and funds in which received by the Issuing Lender. In the event any payment
received by the Issuing Lender and so paid to the Series A Lenders hereunder is
rescinded or must otherwise be returned by the Issuing Lender, each Series A
Lender shall, upon the request of the Issuing Lender (through the Administrative
Agent), repay to the Issuing Lender (through the Administrative Agent) the
amount of such payment paid to such Lender, with interest as specified in clause
(j) of this Section 2.03.
(g) The Company shall pay to the Administrative Agent for account
of the Series A Lenders in respect of each Letter of Credit a letter of credit
fee in an amount equal to the product of the Applicable Margin for Eurodollar
Loans TIMES the daily average undrawn amount of such Letter of Credit for the
period from and including the date of issuance of such Letter of Credit to and
including the date such Letter of Credit is drawn in full, expires or is
terminated (such fee to be non-refundable, to be paid in arrears on each
Quarterly Date and on the Series A Commitment Termination Date and to be
calculated, for any day, after giving effect to any payments made under such
Letter of Credit on such day). In addition, the Company shall pay to the
Administrative Agent for account of the Issuing Lender all commissions, charges,
costs and expenses in the amounts customarily charged by the Issuing Lender from
time to time in like circumstances with respect to the issuance of each Letter
of Credit and drawings and other transactions relating thereto.
CREDIT AGREEMENT
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(h) Promptly following the end of each calendar month, the
Issuing Lender shall deliver (through the Administrative Agent) to each Series A
Lender and the Company a notice describing the aggregate amount of all Letters
of Credit outstanding at the end of such month. Upon the request of any Series A
Lender from time to time, the Issuing Lender shall deliver any other information
reasonably requested by such Lender with respect to each Letter of Credit then
outstanding.
(i) The issuance by the Issuing Lender of each Letter of Credit
shall, in addition to the conditions precedent set forth in Section 6 hereof, be
subject to the conditions precedent that (i) such Letter of Credit shall be in
such form, contain such terms and support such transactions as shall be
satisfactory to the Issuing Lender consistent with its then current practices
and procedures with respect to letters of credit of the same type and (ii) the
Company shall have executed and delivered such applications, agreements and
other instruments relating to such Letter of Credit as the Issuing Lender shall
have reasonably requested consistent with its then current practices and
procedures with respect to letters of credit of the same type, provided that in
the event of any conflict between any such application, agreement or other
instrument and the provisions of this Agreement or any Security Document, the
provisions of this Agreement and the Security Documents shall control.
(j) To the extent that any Series A Lender fails to pay any
amount required to be paid pursuant to clause (e) or (f) of this Section 2.03 on
the due date therefor, such Lender shall pay interest to the Issuing Lender
(through the Administrative Agent) on such amount from and including such due
date to but excluding the date such payment is made (i) during the period from
and including such due date to but excluding the date three Business Days
thereafter, at a rate per annum equal to the Federal Funds Rate (as in effect
from time to time) and (ii) thereafter, at a rate per annum equal to the Base
Rate (as in effect from time to time) plus 2%.
(k) The issuance by the Issuing Lender of any modification or
supplement to any Letter of Credit hereunder shall be subject to the same
conditions applicable under this Section 2.03 to the issuance of new Letters of
Credit, and no such modification or supplement shall be issued hereunder unless
either (x) the respective Letter of Credit affected thereby would have complied
with such conditions had it originally been issued hereunder in such modified or
supplemented form or (y) each Series A Lender shall have consented thereto.
(l) Pursuant to Section 2.03 of the Existing Credit Agreement,
Chase has issued the Letters of Credit identified on Schedule V hereto (the
"EXISTING LETTERS OF CREDIT"). Each Series A Lender hereby agrees that each
Existing Letter of Credit shall constitute, on and after the Amendment Effective
Date, a Letter of Credit for all purposes of this Agreement.
The Company hereby indemnifies and holds harmless each Series A Lender and the
Administrative Agent from and against any and all claims and damages, losses,
liabilities, costs or expenses which such Lender or the Administrative Agent may
incur (or which may be claimed against such Lender or the Administrative Agent
by any Person whatsoever) by reason of or in connection with the execution and
delivery or transfer of or payment or refusal to pay by the Issuing Lender under
any Letter of Credit; PROVIDED that the Company shall not be required
CREDIT AGREEMENT
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to indemnify any Lender or the Administrative Agent for any claims, damages,
losses, liabilities, costs or expenses to the extent, but only to the extent,
caused by (x) the willful misconduct or gross negligence of the Issuing Lender
in determining whether a request presented under any Letter of Credit complied
with the terms of such Letter of Credit or (y) in the case of the Issuing
Lender, such Lender's failure to pay under any Letter of Credit after the
presentation to it of a request strictly complying with the terms and conditions
of such Letter of Credit. Nothing in this Section 2.03 is intended to limit the
other obligations of the Company, any Lender or the Administrative Agent under
this Agreement.
2.04 CHANGES OF COMMITMENTS.
(a) SERIES A COMMITMENTS.
(i) The Series A Commitments shall terminate on the Series A
Commitment Termination Date.
(ii) The Company shall have the right at any time or from time to
time (x) so long as no Series A Loans or Letter of Credit Liabilities
are outstanding, to terminate the Series A Commitments and (y) to reduce
the aggregate unused amount of the Series A Commitments (for which
purpose use of the Series A Commitments shall be deemed to include the
aggregate amount of Letter of Credit Liabilities); PROVIDED that (A) the
Company shall give notice of each such termination or reduction as
provided in Section 4.05 hereof and (B) each partial reduction shall be
in an aggregate amount at least equal to $5,000,000 or in multiples of
$1,000,000 in excess thereof.
(b) SERIES B COMMITMENTS.
(i) The Series B Commitments shall terminate on the Series B
Commitment Termination Date.
(ii) The Company shall have the right at any time or from time to
time (x) so long as no Series B Loans are outstanding, to terminate the
Series B Commitments and (y) to reduce the aggregate amount of the
Series B Commitments; PROVIDED that (A) the Company shall give notice of
each such termination or reduction as provided in Section 4.05 hereof;
(B) each partial reduction shall be in an aggregate amount at least
equal to $5,000,000 or in multiples of $1,000,000 in excess thereof; and
(C) to the extent that, after giving effect to any such reduction, the
aggregate principal amount of the Series B Loans would exceed the Series
B Commitments, the Company shall prepay the Series B Loans.
(c) ALL COMMITMENTS. The Commitments once terminated or reduced
may not be reinstated.
2.05 COMMITMENT FEE. The Company shall pay to the Administrative
Agent for account of (i) each Series A Lender a commitment fee on the daily
average unused amount of
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such Lender's Series A Commitment (for which purpose Letter of Credit
Liabilities shall be deemed to be a use of any Lender's Series A Commitment) and
(ii) each Series B Lender a commitment fee on the daily average unused amount of
such Lender's Series B Commitment, for the period from and including the
Amendment Effective Date to but not including the date such Commitment is
terminated, at a rate per annum equal to the Commitment Fee Rate. Accrued
commitment fee shall be payable on each Quarterly Date and on the date the
relevant Commitments are terminated.
2.06 LENDING OFFICES. The Loans of each Type made by each Lender
shall be made and maintained at such Lender's Applicable Lending Office for
Loans of such Type.
2.07 SEVERAL OBLIGATIONS; REMEDIES INDEPENDENT. The failure of
any Lender to make any Loan to be made by it on the date specified therefor
shall not relieve any other Lender of its obligation to make its Loan on such
date, but neither any Lender nor the Administrative Agent shall be responsible
for the failure of any other Lender to make a Loan to be made by such other
Lender, and no Lender shall have any obligation to the Administrative Agent
(except as provided in Section 4.06 hereof) or any other Lender for the failure
by such Lender to make any Loan required to be made by such Lender.
2.08 EVIDENCE OF DEBT.
(a) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the Indebtedness of the Company to
such Lender resulting from each Loan made or continued hereunder by such Lender,
including the amounts of principal and interest payable and paid to such Lender
from time to time hereunder.
(b) The Administrative Agent shall maintain accounts in which it
shall record (i) the amount of each Loan made or continued hereunder, the Class
and Type thereof and the Interest Period applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Company to each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder for the account of the Lenders and each Lender's
share thereof.
(c) The entries made in the accounts maintained pursuant to
paragraph (a) or (b) of this Section 2.08 shall be PRIMA FACIE evidence of the
existence and amounts of the obligations recorded therein; PROVIDED that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Company
to repay the Loans in accordance with the terms of this Agreement.
(d) Any Lender may request that Loans made or continued by it
hereunder be evidenced by a promissory note(s). In such event, the Company, at
its own expense, shall prepare, execute and deliver to such Lender a promissory
note(s) payable to the order of such Lender (or, if requested by such Lender, to
such Lender and its registered assigns) and in a form approved by the
Administrative Agent and such note(s) shall be evidence of such Loans (and all
amounts payable in respect thereof).
CREDIT AGREEMENT
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2.09 OPTIONAL PREPAYMENTS AND CONVERSIONS OR CONTINUATIONS OF
LOANS. Subject to Sections 4.04 and 5.05 hereof, the Company shall have the
right to prepay Loans, or to Convert Loans of one Type into Loans of another
Type or Continue Loans of one Type as Loans of the same Type, at any time or
from time to time, PROVIDED that the Company shall give the Administrative Agent
notice of each such prepayment, Conversion or Continuation as provided in
Section 4.05 hereof (and, upon the date specified in any such notice of
prepayment, the amount to be prepaid shall become due and payable hereunder) and
PROVIDED further that any prepayment of the principal of the Series B Loans
shall be applied to reduce the then remaining installments thereof on a pro rata
basis (based on the then remaining principal amount of each such installment).
Notwithstanding the foregoing, and without limiting the rights and remedies of
the Lenders under Section 9 hereof, in the event that any Event of Default shall
have occurred and be continuing, the Administrative Agent may (and at the
request of the Majority Lenders shall) suspend the right of the Company to
Convert any Loan into a Eurodollar Loan, or to Continue any Loan as a Eurodollar
Loan, in which event all Loans shall be Converted (on the last day(s) of the
respective Interest Periods therefor) or Continued, as the case may be, as Base
Rate Loans.
2.10 MANDATORY PREPAYMENTS AND REDUCTIONS OF COMMITMENTS.
(a) [Intentionally Omitted]
(b) CASUALTY EVENTS. Unless the Company or any of its
Subsidiaries, as the case may be, shall have irrevocably committed to repair or
replace any Property of the Company or such Subsidiary affected by a Casualty
Event, on the date 30 days following the receipt by the Company of the proceeds
of insurance, condemnation award or other compensation in respect of such
Casualty Event affecting such Property (or upon such earlier date as the Company
or such Subsidiary, as the case may be, shall have determined not to repair or
replace the Property affected by such Casualty Event), the Company shall prepay
the Loans (and/or provide cover for Letter of Credit Liabilities as specified in
clause (f) below), and the Commitments shall be subject to automatic reduction,
in an aggregate amount, if any, equal to 75% of the Net Available Proceeds of
such Casualty Event not theretofore applied to the repair or replacement of such
Property (or reserved by the Company for application to such purposes), such
prepayment and reduction to be effected in each case in the manner and to the
extent specified in clause (e) of this Section 2.10. Nothing in this clause (b)
shall be deemed to limit any obligation of the Company or any of its
Subsidiaries pursuant to any of the Security Documents to remit to a collateral
or similar account (including, without limitation, the Collateral Account)
maintained by the Administrative Agent pursuant to any of the Security Documents
the proceeds of insurance, condemnation award or other compensation received in
respect of any Casualty Event.
(c) RECAPTURE OF PROCEEDS FROM ASSET SALES. In the event of a
Disposition, the Company shall deposit 75% of the Net Available Proceeds
therefrom into the Collateral Account no later than five Business Days after
receipt thereof; PROVIDED that prior to such deposit the Company may invest such
Net Available Proceeds, or after such deposit the Company may withdraw such Net
Available Proceeds from the Collateral Account within 270 days after such
CREDIT AGREEMENT
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Disposition so long as immediately thereafter such Net Available Proceeds are
invested, in Property to be used by the Company or any of its Subsidiaries in
the lines of business in which the Company or any of its Subsidiaries is engaged
as of the Restatement Date or in any business related thereto. No later than 270
days following the occurrence of any such Disposition, the Company will deliver
to the Lenders a statement, certified by the chief financial officer of the
Company, in form and detail satisfactory to the Administrative Agent, of the
amount of the Net Available Proceeds of such Disposition not applied as
contemplated by the immediately preceding sentence and, on the first Recapture
Date thereafter, the Company shall withdraw the remaining Net Available Proceeds
from the Collateral Account and prepay the Loans (and/or provide cover for
Letter of Credit Liabilities as specified in clause (f) below), and the
Commitments shall be subject to automatic reduction, in an aggregate amount
equal to 75% of the Net Available Proceeds received or which become available
for prepayment or reduction during such Recapture Period ending on such
Recapture Date, such prepayment and reduction to be effected in each case in the
manner and to the extent specified in clause (e) of this Section 2.10. In
addition to the foregoing, to the extent the remaining 25% of the Net Available
Proceeds from such Disposition would become "Excess Proceeds" (as defined in the
Senior Subordinated Indenture[s]) under clause (b) of Section 1016 of the Senior
Subordinated Indenture[s] (the "REMAINDER AMOUNT"), the Company shall,
immediately prior to such Remainder Amount becoming "Excess Proceeds" as
aforesaid, prepay the Loans (and/or provide cover for Letter of Credit
Liabilities as specified in clause (f) below), and the Commitments shall be
subject to automatic reduction, in an aggregate amount equal to such Remainder
Amount, such prepayment and reduction to be effected in each case in the manner
and to the extent specified in clause (e) of this Section 2.10. Nothing in this
Section 2.10(c) shall be deemed to excuse or otherwise limit the obligation of
the Company to obtain the consent of the Majority Lenders pursuant to Section
8.05 hereof to any Disposition not otherwise permitted hereunder.
(d) REVERSIONS. Without limiting the obligation of the Company
under Section 8.01(c) hereof, upon any Reversion the Company shall prepay the
Loans (and/or provide cover for Letter of Credit Liabilities as specified in
clause (f) below), and the Commitments shall be subject to automatic reduction,
in an aggregate amount equal to 75% of the Net Available Proceeds thereof, such
prepayment and reduction to be effected in each case in the manner and to the
extent specified in clause (e) of this Section 2.10.
(e) APPLICATION. Prepayments and reductions of Commitments
described in the above clauses of this Section 2.10 shall be effected as
follows:
(i) first, the Series B Loans shall be prepaid in an amount equal
to the prepayment or reduction specified in such clauses (such
prepayments shall be applied first to Base Rate Loans and then to
Eurodollar Loans) and shall be applied to the installments of the Series
B Loans on a pro rata basis (based on the then remaining principal
amount of each such installment); and
(ii) second, any excess over the amount referred to in the
foregoing clause (i) shall automatically reduce the Series A Commitments
(and to the extent that, after giving effect to such reduction, the
aggregate principal amount of Series A Loans, together with
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the aggregate amount of all Letter of Credit Liabilities, would exceed
the Series A Commitments, the Company shall, first, prepay Series A
Loans (such prepayments shall be applied first to Base Rate Loans and
then to Eurodollar Loans) and, second, provide cover for Letter of
Credit Liabilities as specified in clause (f) below, in an aggregate
amount equal to such excess).
(f) COVER FOR LETTER OF CREDIT LIABILITIES. In the event that the
Company shall be required pursuant to this Section 2.10 to provide cover for
Letter of Credit Liabilities, the Company shall effect the same by paying to the
Administrative Agent immediately available funds in an amount equal to the
required amount, which funds shall be retained by the Administrative Agent in
the Collateral Account (as provided therein as collateral security in the first
instance for the Letter of Credit Liabilities) until such time as the Letters of
Credit shall have been terminated and all of the Letter of Credit Liabilities
paid in full.
Section 3. PAYMENTS OF PRINCIPAL AND INTEREST.
3.01 REPAYMENT OF LOANS.
(a) The Company hereby promises to pay to the Administrative
Agent for account of each Series A Lender the entire outstanding principal
amount of such Lender's Series A Loans, and each Series A Loan shall mature, on
the Series A Commitment Termination Date.
(b) Subject to Sections 2.09 and 2.10 hereof, the Company hereby
promises to pay to the Administrative Agent for account of each Series B Lender
the principal amount of each of such Lender's Series B Loans in twenty (20)
consecutive quarterly installments, commencing on the Quarterly Date falling
approximately three (3) months after the Series B Commitment Termination Date
and on each of the nineteen (19) Quarterly Dates thereafter, the first eight (8)
of which shall each be in an amount equal to 2.5% of the initial principal
amount of such Series B Loan, the next four (4) of which shall each be in an
amount equal to 4% of the initial principal amount of such Series B Loan, the
next four (4) of which shall each be in an amount equal to 7% of the initial
principal amount of such Series B Loan, and the last four (4) of which shall
each be in an amount equal to 9% of the initial principal amount of such Series
B Loan.
3.02 INTEREST. The Company hereby promises to pay to the
Administrative Agent for account of each Lender interest on the unpaid principal
amount of each Loan made by such Lender for the period from and including the
date of such Loan to but excluding the date such Loan shall be paid in full, at
the following rates per annum:
(a) during such periods as such Loan is a Base Rate Loan, the
Base Rate (as in effect from time to time) PLUS the Applicable Margin (if any)
and
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(b) during such periods as such Loan is a Eurodollar Loan, for
each Interest Period relating thereto, the Eurodollar Rate for such Loan for
such Interest Period PLUS the Applicable Margin.
Notwithstanding the foregoing, the Company hereby promises to pay to the
Administrative Agent for account of each Lender interest at the applicable
Post-Default Rate on any principal of any Loan made by such Lender, on any
Reimbursement Obligation held by such Lender and on any other amount payable by
the Company hereunder or under the Notes held by such Lender to or for account
of such Lender, which shall not be paid in full when due (whether at stated
maturity, by acceleration, by mandatory prepayment or otherwise), for the period
from and including the due date thereof to but excluding the date the same is
paid in full. Accrued interest on each Loan shall be payable (i) in the case of
a Base Rate Loan, quarterly on the Quarterly Dates, (ii) in the case of a
Eurodollar Loan, on the last day of each Interest Period therefor and, if such
Interest Period is longer than three months, at three-month intervals following
the first day of such Interest Period, and (iii) in the case of any Loan, upon
the payment or prepayment thereof or the Conversion of such Loan to a Loan of
another Type (but only on the principal amount so paid, prepaid or Converted),
except that interest payable at the Post-Default Rate shall be payable from time
to time on demand. Promptly after the determination of any interest rate
provided for herein or any change therein, the Administrative Agent shall give
notice thereof to the Lenders to which such interest is payable and to the
Company.
Section 4. PAYMENTS; PRO RATA TREATMENT; COMPUTATIONS; ETC.
4.01 PAYMENTS.
(a) Except to the extent otherwise provided herein, all payments
of principal, interest, Reimbursement Obligations and other amounts to be made
by the Company under this Agreement and the Notes, and, except to the extent
otherwise provided therein, all payments to be made by the Company under any
other Basic Document, shall be made in Dollars, in immediately available funds,
without deduction, set-off or counterclaim, to the Administrative Agent to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Company, not later than 1:00 p.m. New York time on the
date on which such payment shall become due (each such payment made after such
time on such due date to be deemed to have been made on the next succeeding
Business Day).
(b) Any Lender for whose account any such payment is to be made
may (but shall not be obligated to) debit the amount of any such payment that is
not made by such time to any ordinary deposit account of the Company with such
Lender (with notice to the Company and the Administrative Agent).
(c) The Company shall, at the time of making each payment under
this Agreement or any Note for account of any Lender, specify to the
Administrative Agent (which shall so notify the intended recipient(s) thereof)
the Loans, Reimbursement Obligations or other amounts payable by the Company
hereunder to which such payment is to be applied (and in the
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event that the Company fails to so specify, or if an Event of Default has
occurred and is continuing, the Administrative Agent may distribute such payment
to the Lenders for application in such manner as it or the Majority Lenders,
subject to Section 4.02 hereof, may determine to be appropriate).
(d) Except to the extent otherwise provided in the last sentence
of Section 2.03(e) hereof, each payment received by the Administrative Agent
under this Agreement or any Note for account of any Lender shall be paid by the
Administrative Agent promptly to such Lender, in immediately available funds,
for account of such Lender's Applicable Lending Office for the Loan or other
obligation in respect of which such payment is made.
(e) If the due date of any payment under this Agreement or any
Note would otherwise fall on a day that is not a Business Day, such date shall
be extended to the next succeeding Business Day, and interest shall be payable
for any principal so extended for the period of such extension.
4.02 PRO RATA TREATMENT. Except to the extent otherwise provided
herein: (a) each borrowing of Loans of a particular Class from the Lenders under
Section 2.01 hereof shall be made from the relevant Lenders, each payment of
commitment fee under Section 2.05 hereof in respect of Commitments of a
particular Class shall be made for account of the relevant Lenders, and each
termination or reduction of the amount of the Commitments of a particular Class
under Section 2.04 hereof and under Section 2.10(e) hereof shall be applied to
the respective Commitments of such Class of the relevant Lenders, pro rata
according to the amounts of their respective Commitments of such Class; (b) the
making, Conversion and Continuation of Series A Loans and Series B Loans of a
particular Type (other than Conversions provided for by Section 5.04 hereof)
shall be made pro rata among the relevant Lenders according to the amounts of
their respective Series A and Series B Commitments (in the case of making of
Loans) or their respective Series A and Series B Loans (in the case of
Conversions and Continuations of Loans) and the then current Interest Period for
each Eurodollar Loan shall be coterminous; (c) each payment or prepayment of
principal of Series A Loans or Series B Loans by the Company shall be made for
account of the relevant Lenders pro rata in accordance with the respective
unpaid principal amounts of the Loans of such Class held by them; and (d) each
payment of interest on Series A Loans and Series B Loans by the Company shall be
made for account of the relevant Lenders pro rata in accordance with the amounts
of interest on such Loans then due and payable to the respective Lenders.
4.03 COMPUTATIONS. Interest on Eurodollar Loans and Reimbursement
Obligations and commitment fee and letter of credit fee shall be computed on the
basis of a year of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable and interest
on Base Rate Loans shall be computed on the basis of a year of 365 or 366 days,
as the case may be, and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable.
Notwithstanding the foregoing, for each date that the Base Rate is calculated by
reference to the Federal Funds Rate, interest on Base Rate Loans shall be
computed on the basis of a year of 360 days and actual days elapsed.
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4.04 MINIMUM AMOUNTS. Except for mandatory prepayments made
pursuant to Section 2.10 hereof and Conversions or prepayments made pursuant to
Section 5.04 hereof, (i) each borrowing, Conversion and partial prepayment of
principal of Series A Loans shall be in multiples of $1,000,000 and (ii) each
borrowing, Conversion or partial prepayment of principal of Series B Loans shall
be in multiples of $1,000,000 (borrowings, Conversions or prepayments of or into
Loans of different Types, or, in the case of Eurodollar Loans, having different
Interest Periods at the same time hereunder to be deemed separate borrowings,
Conversions and prepayments for purposes of the foregoing, one for each Type or
Interest Period). Anything in this Agreement to the contrary notwithstanding,
the aggregate principal amount of Eurodollar Loans having the same Interest
Period shall be in an amount at least equal to $5,000,000 or in multiples of
$1,000,000 in excess thereof and, if any Eurodollar Loans would otherwise be in
a lesser principal amount for any period, such Loans shall be Base Rate Loans
during such period.
4.05 CERTAIN NOTICES. Notices by the Company to the
Administrative Agent of terminations or reductions of the Commitments, of
borrowings, Conversions, Continuations and optional prepayments of Loans and of
Classes of Loans and of Types of Loans and of the duration of Interest Periods
shall be irrevocable and shall be effective only if received by the
Administrative Agent not later than 10:00 a.m. New York time on the number of
Business Days prior to the date of the relevant termination, reduction,
borrowing, Conversion, Continuation or prepayment or the first day of such
Interest Period specified below:
Number of Business Notice Days Prior
------------------------------------- ----------
Termination or reduction 3
of Commitments
Borrowing or prepayment of, 1
or Conversions into,
Base Rate Loans
Borrowing or prepayment of, 3
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans
Each such notice of termination or reduction shall specify the amount and the
Class of the Commitments to be terminated or reduced. Each such notice of
borrowing, Conversion, Continuation or optional prepayment shall specify the
Class of Loans to be borrowed, Converted, Continued or prepaid and the amount
(subject to Section 4.04 hereof) and Type of each Loan to be borrowed,
Converted, Continued or prepaid and the date of borrowing, Conversion,
Continuation or optional prepayment (which shall be a Business Day). Each such
notice of the duration of an Interest Period shall specify the Loans to which
such Interest Period is to relate. The Administrative Agent shall promptly
notify the Lenders of the contents of each such notice. In the event that the
Company fails to select the Type of Loan, or the duration of any Interest Period
for any Eurodollar Loan, within the time period and otherwise as provided in
this Section 4.05, such Loan (if outstanding as a Eurodollar Loan) will be
automatically Converted
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into a Base Rate Loan on the last day of the then current Interest Period for
such Loan or (if outstanding as a Base Rate Loan) will remain as, or (if not
then outstanding) will be made as, a Base Rate Loan.
4.06 NON-RECEIPT OF FUNDS BY THE ADMINISTRATIVE AGENT. Unless the
Administrative Agent shall have been notified by a Lender or the Company (the
"PAYOR") prior to the date on which the Payor is to make payment to the
Administrative Agent of (in the case of a Lender) the proceeds of a Loan to be
made by such Lender, or a participation in a Letter of Credit drawing to be
acquired by such Lender, hereunder or (in the case of the Company) a payment to
the Administrative Agent for account of one or more of the Lenders hereunder
(such payment being herein called the "REQUIRED PAYMENT"), which notice shall be
effective upon receipt, that the Payor does not intend to make the Required
Payment to the Administrative Agent, the Administrative Agent may assume that
the Required Payment has been made and may, in reliance upon such assumption
(but shall not be required to), make the amount thereof available to the
intended recipient(s) on such date; and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient(s) of such payment
shall, on demand, repay to the Administrative Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date (the "ADVANCE DATE") such amount was so made available by
the Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to the Federal Funds Rate for such day and, if
such recipient(s) shall fail promptly to make such payment, the Administrative
Agent shall be entitled to recover such amount, on demand, from the Payor,
together with interest as aforesaid, PROVIDED that if neither the recipient(s)
nor the Payor shall return the Required Payment to the Administrative Agent
within three Business Days of the Advance Date, then, retroactively to the
Advance Date, the Payor and the recipient(s) shall each be obligated to pay
interest on the Required Payment as follows:
(i) if the Required Payment shall represent a payment to be made
by the Company to the Lenders, the Company and the recipient(s) shall
each be obligated retroactively to the Advance Date to pay interest in
respect of the Required Payment at the Post-Default Rate (and, in case
the recipient(s) shall return the Required Payment to the Administrative
Agent, without limiting the obligation of the Company under Section 3.02
hereof to pay interest to such recipient(s) at the Post-Default Rate in
respect of the Required Payment) and
(ii) if the Required Payment shall represent proceeds of a loan
to be made by the Lenders to the Company, the Payor and the Company
shall each be obligated retroactively to the Advance Date to pay
interest in respect of the Required Payment at the rate of interest
provided for such Required Payment pursuant to Section 3.02 hereof (and,
in case the Company shall return the Required Payment to the
Administrative Agent, without limiting any claim the Company may have
against the Payor in respect of the Required Payment).
4.07 SHARING OF PAYMENTS, ETC.
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(a) The Company agrees that, in addition to (and without
limitation of) any right of set-off, banker's lien or counterclaim a Lender may
otherwise have, each Lender shall be entitled, at its option, to offset balances
held by it for account of the Company at any of its offices, in Dollars or in
any other currency, against any principal of or interest on any of such Lender's
Loans, Reimbursement Obligations or any other amount payable to such Lender
hereunder, that is not paid when due (regardless of whether such balances are
then due to the Company), in which case it shall promptly notify the Company and
the Administrative Agent thereof, PROVIDED that such Lender's failure to give
such notice shall not affect the validity thereof.
(b) If any Lender shall obtain from the Company payment of any
principal of or interest on any Loan of any Class or Letter of Credit Liability
owing to it or payment of any other amount under this Agreement or any other
Basic Document through the exercise of any right of set-off, banker's lien or
counterclaim or similar right or otherwise (other than from the Administrative
Agent as provided herein), and, as a result of such payment, such Lender shall
have received a greater percentage of the principal of or interest on the Loans
of such Class or Letter of Credit Liabilities or such other amounts then due
hereunder or thereunder by the Company to such Lender than the percentage
received by any other Lender, it shall promptly purchase from such other Lenders
participations in (or, if and to the extent specified by such Lender, direct
interests in) the Loans of such Class or Letter of Credit Liabilities or such
other amounts, respectively, owing to such other Lenders (or in interest due
thereon, as the case may be) in such amounts, and make such other adjustments
from time to time as shall be equitable, to the end that all the Lenders shall
share the benefit of such excess payment (net of any expenses that may be
incurred by such Lender in obtaining or preserving such excess payment) pro rata
in accordance with the unpaid principal of and/or interest on the Loans of such
Class or Letter of Credit Liabilities or such other amounts, respectively, owing
to each of the Lender. To such end all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise)
if such payment is rescinded or must otherwise be restored.
(c) The Company agrees that any Lender so purchasing such a
participation (or direct interest) may exercise all rights of set-off, banker's
lien, counterclaim or similar rights with respect to such participation as fully
as if such Lender were a direct holder of Loans or other amounts (as the case
may be) owing to such Lender in the amount of such participation.
(d) Nothing contained herein shall require any Lender to exercise
any such right or shall affect the right of any Lender to exercise, and retain
the benefits of exercising, any such right with respect to any other
indebtedness or obligation of the Company. If, under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a set-off to which this Section 4.07 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders entitled under this Section 4.07 to
share in the benefits of any recovery on such secured claim.
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Section 5. YIELD PROTECTION, ETC.
5.01 ADDITIONAL COSTS.
(a) The Company shall pay directly to each Lender from time to
time such amounts as such Lender may determine to be necessary to compensate
such Lender for any costs that such Lender determines are attributable to its
making or maintaining of any Eurodollar Loans or its obligation to make any
Eurodollar Loans hereunder, or any reduction in any amount receivable by such
Lender hereunder in respect of any of such Loans or such obligation (such
increases in costs and reductions in amounts receivable being herein called
"ADDITIONAL COSTS"), resulting from any Regulatory Change that:
(i) changes the basis of taxation of any amounts payable to such
Lender under this Agreement or its Notes in respect of any of such Loans
(other than taxes imposed on or measured by the overall net income of
such Lender or of its Applicable Lending Office for any of such Loans by
the jurisdiction in which such Lender has its principal office or such
Applicable Lending Office); or
(ii) imposes or modifies any reserve, special deposit or similar
requirements (other than the Reserve Requirement utilized in the
determination of the Eurodollar Rate for such Loan) relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities of, such Lender (including, without limitation, any of such
Loans or any deposits referred to in the definition of "Eurodollar Base
Rate" in Section 1.01 hereof), or any commitment of such Lender
(including, without limitation, the Commitments of such Lender
hereunder); or
(iii) imposes any other condition affecting this Agreement or its
Notes (or any of such extensions of credit or liabilities) or its
Commitments.
If any Lender requests compensation from the Company under this Section 5.01(a),
the Company may, by notice to such Lender (with a copy to the Administrative
Agent), suspend the obligation of such Lender thereafter to make or Continue
Eurodollar Loans, or to Convert Base Rate Loans into Eurodollar Loans, until the
Regulatory Change giving rise to such request ceases to be in effect (in which
case the provisions of Section 5.04 hereof shall be applicable), PROVIDED that
such suspension shall not affect the right of such Lender to receive the
compensation so requested.
(b) Without limiting the effect of the provisions of paragraph
(a) of this Section 5.01, in the event that, by reason of any Regulatory Change,
any Lender either (i) incurs Additional Costs based on or measured by the excess
above a specified level of the amount of a category of deposits or other
liabilities of such Lender that includes deposits by reference to which the
interest rate on Eurodollar Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender that includes
Eurodollar Loans or (ii) becomes subject to restrictions on the amount of such a
category of liabilities or assets that it may hold, then, if such Lender so
elects by notice to the Company (with a copy to the
CREDIT AGREEMENT
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Administrative Agent), the obligation of such Lender to make or Continue, or to
Convert Base Rate Loans into, Eurodollar Loans hereunder shall be suspended
until such Regulatory Change ceases to be in effect (in which case the
provisions of Section 5.04 hereof shall be applicable).
(c) Without limiting the effect of the foregoing provisions of
this Section 5.01 (but without duplication), the Company shall pay directly to
each Lender from time to time on request such amounts as such Lender may
determine to be necessary to compensate such Lender (or, without duplication,
the bank holding company of which such Lender is a subsidiary) for any costs
that it determines are attributable to the maintenance by such Lender (or any
Applicable Lending Office or such bank holding company), pursuant to any law or
regulation or any interpretation, directive or request (whether or not having
the force of law and whether or not failure to complete therewith would be
unlawful) of any court or governmental or monetary authority (i) following any
Regulatory Change or (ii) implementing any risk-based capital guideline or other
requirement (whether or not having the force of law and whether or not the
failure to comply therewith would be unlawful) heretofore or hereafter issued by
any government or governmental or supervisory authority implementing at the
national level the Basle Accord (including, without limitation, the Final
Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve
System (12 C.F.R. Part 208, Appendix A; 00 X.X.X. Xxxx 000, Xxxxxxxx X) and the
Final Risk-Based Capital Guidelines of the Office of the Comptroller of the
Currency (12 C.F.R. Part 3, Appendix A)), of capital in respect of its
Commitments or Loans (such compensation to include, without limitation, an
amount equal to any reduction of the rate of return on assets or equity of such
Lender (or any Applicable Lending Office or such bank holding company) to a
level below that which such Lender (or any Applicable Lending Office or such
bank holding company) could have achieved but for such law, regulation,
interpretation, directive or request). For purposes of this Section 5.01(c) and
Section 5.06 hereof, "BASLE ACCORD" shall mean the proposals for risk-based
capital framework described by the Basle Committee on Banking Regulations and
Supervisory Practices in its paper entitled "International Convergence of
Capital Measurement and Capital Standards" dated July 1988, as amended, modified
and supplemented and in effect from time to time or any replacement thereof.
(d) Each Lender shall notify the Company of any event occurring
after the Amendment Effective Date entitling such Lender to compensation under
paragraph (a) or (c) of this Section 5.01 as promptly as practicable, but in any
event within 45 days, after such Lender obtains actual knowledge thereof;
PROVIDED that (i) if any Lender fails to give such notice within 45 days after
it obtains actual knowledge of such an event, such Lender shall, with respect to
compensation payable pursuant to this Section 5.01 in respect of any costs
resulting from such event, only be entitled to payment under this Section 5.01
for costs incurred from and after the date 45 days prior to the date that such
Lender does give such notice and (ii) each Lender will designate a different
Applicable Lending Office for the Loans of such Lender affected by such event if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole opinion of such Lender, be
disadvantageous to such Lender, except that such Lender shall have no obligation
to designate an Applicable Lending Office located in the United States of
America. Each Lender will furnish to the Company a certificate setting forth the
basis and amount of each request by such Lender for compensation under paragraph
(a) or (c) of this Section 5.01. Determinations and allocations by any Lender
for purposes of this
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Section 5.01 of the effect of any Regulatory Change pursuant to paragraph (a) or
(b) of this Section 5.01, or of the effect of capital maintained pursuant to
paragraph (c) of this Section 5.01, on its costs or rate of return of
maintaining Loans or its obligation to make Loans, or on amounts receivable by
it in respect of Loans, and of the amounts required to compensate such Lender
under this Section 5.01, shall be conclusive, PROVIDED that such determinations
and allocations are made on a reasonable basis.
5.02 LIMITATION ON TYPES OF LOANS. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of any Eurodollar
Base Rate for any Interest Period:
(a) the Administrative Agent reasonably determines, which
determination shall be conclusive, that quotations of interest rates for the
relevant deposits referred to in the definition of "Eurodollar Base Rate" in
Section 1.01 hereof are not being provided in the relevant amounts or for the
relevant maturities for purposes of determining rates of interest for Eurodollar
Loans as provided herein; or
(b) if the related Loans are Series A Loans, the Majority Series
A Lenders or, if the related Loans are Series B Loans, the Majority Series B
Lenders reasonably determine, which determination shall be conclusive, and
notify the Administrative Agent that the relevant rates of interest referred to
in the definition of "Eurodollar Base Rate" in Section 1.01 hereof upon the
basis of which the rate of interest for Eurodollar Loans for such Interest
Period is to be determined are not likely adequately to cover the cost to such
Lenders of making or maintaining Eurodollar Loans for such Interest Period;
then the Administrative Agent shall give the Company and each Lender prompt
notice thereof and, so long as such condition remains in effect, the Lenders
shall be under no obligation to make additional Eurodollar Loans, to Continue
Eurodollar Loans or to Convert Base Rate Loans into Eurodollar Loans, and the
Company shall, on the last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Loans, either prepay such Loans or Convert such Loans
into Base Rate Loans in accordance with Section 2.09 hereof.
5.03 ILLEGALITY. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to honor its obligation to make or maintain Eurodollar
Loans hereunder, then such Lender shall promptly notify the Company thereof
(with a copy to the Administrative Agent) and such Lender's obligation to make
or Continue, or to Convert Loans of any other Type into, Eurodollar Loans shall
be suspended until such time as such Lender may again make and maintain
Eurodollar Loans (in which case the provisions of Section 5.04 hereof shall be
applicable).
5.04 TREATMENT OF AFFECTED LOANS. If the obligation of any Lender
to make Eurodollar Loans or to Continue, or to Convert Base Rate Loans into,
Eurodollar Loans shall be suspended pursuant to Section 5.01 or 5.03 hereof,
such Lender's Eurodollar Loans shall be automatically Converted into Base Rate
Loans on the last day(s) of the then current Interest
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Period(s) for Eurodollar Loans (or, in the case of a Conversion required by
Section 5.01(b) or 5.03 hereof, on such earlier date as such Lender may specify
to the Company with a copy to the Administrative Agent) and, unless and until
such Lender gives notice as provided below that the circumstances specified in
Section 5.01 or 5.03 hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been
so Converted, all payments and prepayments of principal that would otherwise be
applied to such Lender's Eurodollar Loans shall be applied instead to its Base
Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such
Lender as Eurodollar Loans shall be made or Continued instead as Base Rate
Loans, and all Base Rate Loans of such Lender that would otherwise be Converted
into Eurodollar Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Company with a copy to the Administrative
Agent that the circumstances specified in Section 5.01 or 5.03 hereof that gave
rise to the Conversion of such Lender's Eurodollar Loans pursuant to this
Section 5.04 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Eurodollar Loans, to the extent necessary so that, after giving
effect thereto, all Loans held by the Lenders holding Eurodollar Loans and by
such Lender are held pro rata (as to principal amounts, Types and Interest
Periods) in accordance with their respective Commitments.
5.05 COMPENSATION. The Company shall pay to the Administrative
Agent for account of each Lender, upon the request of such Lender through the
Administrative Agent, such amount or amounts as shall be sufficient (in the
reasonable opinion of such Lender) to compensate it for any loss, cost or
expense incurred by it that such Lender determines is attributable to:
(a) any payment, mandatory or optional prepayment or Conversion
of a Eurodollar Loan made by such Lender for any reason (including, without
limitation, the acceleration of the Loans pursuant to Section 9 hereof) on a
date other than the last day of the Interest Period for such Loan; or
(b) any failure by the Company for any reason (including, without
limitation, the failure of any of the conditions precedent specified in Section
6 hereof to be satisfied) to borrow a Eurodollar Loan from such Lender on the
date for such borrowing specified in the relevant notice of borrowing given
pursuant to Section 2.02 hereof.
Without limiting the effect of the preceding sentence, such compensation shall
include an amount equal to the excess, if any, of (i) the amount of interest
that otherwise would have accrued on the principal amount so paid, prepaid or
Converted or not borrowed for the period
CREDIT AGREEMENT
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from the date of such payment, prepayment, Conversion or failure to borrow to
the last day of the then current Interest Period for such Loan (or, in the case
of a failure to borrow, the Interest Period for such Loan that would have
commenced on the date specified for such borrowing) at the applicable rate of
interest for such Loan provided for herein over (ii) the amount of interest that
otherwise would have accrued on such principal amount at a rate per annum equal
to the interest component of the amount such Lender would have bid in the London
interbank market for Dollar deposits of leading banks in amounts comparable to
such principal amount and with maturities comparable to such period (as
reasonably determined by such Lender).
5.06 ADDITIONAL COSTS IN RESPECT OF LETTERS OF CREDIT. Without
limiting the obligations of the Company under Section 5.01 hereof (but without
duplication), if as a result of any Regulatory Change or any risk-based capital
guideline or other requirement heretofore or hereafter issued by any government
or governmental or supervisory authority implementing at the national level the
Basle Accord there shall be imposed, modified or deemed applicable any tax,
reserve, special deposit, capital adequacy or similar requirement against or
with respect to or measured by reference to Letters of Credit issued or to be
issued hereunder and the result shall be to increase the cost to any Lender or
Lenders of issuing (or purchasing or maintaining participations in) or
maintaining its obligation hereunder to issue (or purchase participations in)
any Letter of Credit hereunder or reduce any amount receivable by any Lender
hereunder in respect of any Letter of Credit (which increases in cost, or
reductions in amount receivable, shall be the result of such Lender's or
Lenders' reasonable allocation of the aggregate of such increases or reductions
resulting from such event), then, upon demand by such Lender or Lenders (through
the Administrative Agent), the Company shall pay immediately to the
Administrative Agent for account of such Lender or Lenders, from time to time as
specified by such Lender or Lenders (through the Administrative Agent), such
additional amounts as shall be sufficient to compensate such Lender or Lenders
(through the Administrative Agent) for such increased costs or reductions in
amount. A statement as to such increased costs or reductions in amount incurred
by any such Lender or Lenders, submitted by such Lender or Lenders to the
Company shall be conclusive in the absence of manifest error as to the amount
thereof, PROVIDED that the determination of such increased costs or reductions
are made on a reasonable basis.
5.07 U.S. TAXES.
(a) The Company agrees to pay to each Lender that is not a U.S.
Person such additional amounts as are necessary in order that the net payment of
any amount due to such non-U.S. Person hereunder after deduction for or
withholding in respect of any U.S. Taxes imposed with respect to such payment
(or in lieu thereof, payment of such U.S. Taxes by such non-U.S. Person), will
not be less than the amount stated herein to be then due and payable, PROVIDED
that the foregoing obligation to pay such additional amounts shall not apply:
(i) to any payment to a Lender hereunder unless such Lender is,
on the Amendment Effective Date (or on the date it becomes a Lender as
provided in Section 11.06(b) hereof) and on the date of any change in
the Applicable Lending Office of such Lender, either entitled to submit
a Form 1001 (relating to such Lender and entitling it to a complete
exemption from withholding on all interest to be received by it
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hereunder in respect of the Loans) or Form 4224 (relating to all
interest to be received by such Lender hereunder in respect of the
Loans), or
(ii) to any U.S. Taxes imposed solely by reason of the failure by
such non-U.S. Person to comply with applicable certification,
information, documentation or other reporting requirements concerning
the nationality, residence, identity or connections with the United
States of America of such non-U.S. Person if such compliance is required
by statute or regulation of the United States of America as a
precondition to relief or exemption from such U.S. Taxes.
For the purposes of this Section 5.07(a), (w) "FORM 1001" shall mean Form 1001
(Ownership, Exemption, or Reduced Rate Certificate) of the Department of the
Treasury of the United States of America, (x) "FORM 4224" shall mean Form 4224
(Exemption from Withholding of Tax on Income Effectively Connected with the
Conduct of a Trade or Business in the United States) of the Department of the
Treasury of the United States of America (or in relation to either such Form
such successor and related forms as may from time to time be adopted by the
relevant taxing authorities of the United States of America to document a claim
to which such Form relates), (y) "U.S. PERSON" shall mean a citizen, national or
resident of the United States of America, a corporation, partnership or other
entity created or organized in or under any laws of the United States of
America, or any estate or trust that is subject to Federal income taxation
regardless of the source of its income and (z) "U.S. TAXES" shall mean any
present or future tax, assessment or other charge or levy imposed by or on
behalf of the United States of America or any taxing authority thereof or
therein.
(b) Within 30 days after paying any amount to the Administrative
Agent or any Lender from which it is required by law to make any deduction or
withholding, and within 30 days after it is required by law to remit such
deduction or withholding to any relevant taxing or other authority, the Company
shall deliver to the Administrative Agent for delivery to such non-U.S. Person
evidence satisfactory to such Person of such deduction, withholding or payment
(as the case may be).
Section 6. CONDITIONS PRECEDENT.
6.01 CONDITIONS TO EFFECTIVENESS. The effectiveness of the
amendment and restatement of the Existing Credit Agreement provided for hereby
is subject to the receipt by the Administrative Agent of the following
documents, each of which shall be satisfactory to the Administrative Agent (and
to the extent specified below, to each Lender) in form and substance:
(a) CORPORATE DOCUMENTS. The following documents, each certified
as indicated below:
(i) a copy of the charter, as amended and in effect, of the
Company certified as of a recent date by the Secretary of State of the
State of Delaware (or, if there have been no
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modifications to such charter from the copy thereof delivered by the
Company pursuant to the Existing Credit Agreement, a certificate of the
Secretary or an Assistant Secretary of the Company to that effect), and
a certificate from such Secretary of State dated as of a recent date as
to the good standing of and charter documents filed by the Company;
(ii) a certificate of the Secretary or an Assistant Secretary of
the Company, dated the Amendment Effective Date and certifying (A) that
attached thereto is a true and complete copy of the by-laws of the
Company as amended and in effect at all times from the date on which the
resolutions referred to in clause (B) below were adopted to and
including the date of such certificate (or if there have been no
modifications to such by-laws from the copy thereof delivered by the
Company pursuant to the Existing Credit Agreement, a certificate of the
Secretary or an Assistant Secretary of the Company to that effect), (B)
that attached thereto is a true and complete copy of resolutions duly
adopted by the board of directors of the Company authorizing the
execution, delivery and performance of the amendment and restatement of
the Existing Credit Agreement and such other of the Basic Documents to
which the Company is or is intended to be a party and the extensions of
credit hereunder, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the
charter of the Company has not been amended since the date of the
certification thereto furnished pursuant to clause (i) above, and (D) as
to the incumbency and specimen signature of each officer of the Company
executing the amendment and restatement of the Existing Credit Agreement
and such other of the Basic Documents to which the Company is intended
to be a party and each other document to be delivered by the Company
from time to time in connection therewith (and the Administrative Agent
and each Lender may conclusively rely on such certificate until it
receives notice in writing from the Company to the contrary); and
(iii) a certificate of another officer of the Company as to the
incumbency and specimen signature of the Secretary or Assistant
Secretary, as the case may be, of the Company.
(b) OFFICER'S CERTIFICATE. A certificate of a senior officer of
the Company, dated the Amendment Effective Date, to the effect that (i) no
Default shall have occurred and be continuing and (ii) the representations and
warranties made by the Company in Section 7 hereof, and in each of the other
Basic Documents, are true and correct on and as of the Amendment Effective Date
with the same force and effect as if made on and as of such date (or, if any
such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date).
(c) OPINION OF COUNSEL TO THE COMPANY. An opinion, dated the
Amendment Effective Date, of Ropes & Xxxx, counsel to the Company, in form and
substance satisfactory to the Administrative Agent (and the Company hereby
instructs such counsel to deliver such opinions to the Lenders and the
Administrative Agent).
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(d) OPINION OF SPECIAL NEW YORK COUNSEL TO CHASE. An opinion,
dated the Amendment Effective Date, of Milbank, Tweed, Xxxxxx & XxXxxx, special
New York counsel to Chase, in form and substance satisfactory to the
Administrative Agent.
(e) FINANCIAL INFORMATION. True, correct and complete copies of
the financial statements, projections and other information referred to in
Section 7.02 hereof.
(f) APPROVALS AND CONSENTS. Evidence that all necessary
governmental and third party filings, licenses, permits, consents and approvals
have been obtained by the Company and are in full force and effect on the
Amendment Effective Date.
(g) PAYMENT OF FEES AND EXPENSES. Evidence that (i) all principal
of and interest on, and all other amount owing in respect of, the loans made by
the Existing Lenders under the Existing Credit Agreement shall have been paid in
full and (ii) all fees and expenses payable to the Existing Lenders and the
Administrative Agent under the Existing Credit Agreement accrued to the
Amendment Effective Date and unpaid and such fees as the Company shall have
agreed to pay or deliver to the Administrative Agent in connection herewith,
including, without limitation, the reasonable fees and expenses of Milbank,
Tweed, Xxxxxx & XxXxxx, special New York counsel to Chase in connection with the
negotiation, preparation, execution and delivery of the amendment and
restatement of the Existing Credit Agreement and the Notes and the other Basic
Documents and the extensions of credit hereunder (to the extent that statements
for such fees and expenses have been delivered to the Company) shall have been
paid in full.
(h) GOVERNMENTAL PROCEEDINGS; ETC. Evidence that no litigation or
similar proceeding is threatened by any governmental agency or authority or any
other person with respect to the execution and delivery of the amendment and
restatement of the Existing Credit Agreement, the Notes and the other Basic
Documents, and the consummation of the transactions herein or therein
contemplated which, in each case, the Lenders shall reasonably determine is
likely to have a material adverse effect on (i) the assets, business,
operations, or condition (financial or otherwise) or prospects of the Company
and its Subsidiaries taken as a whole or (ii) the timely payment of the Loans
and interest thereon or the enforceability of the Basic Documents or the rights
and remedies thereunder.
(i) LEVERAGE RATIO. A certificate of a senior officer of the
Company, dated the Amendment Effective Date, setting forth the Leverage Ratio as
at the Amendment Effective Date.
(j) SECURITY DOCUMENTS. The Security Documents duly executed and
delivered by the parties thereto, together with (x) stock certificates
representing all of the shares of each Domestic Subsidiary that is a Material
Subsidiary directly owned by the Company (except for B/E Advanced Thermal
Technologies, Inc.) and not less than 65% of the shares of each Foreign
Subsidiary that is a Material Subsidiary directly owned by the Company, together
with undated stock powers (or the equivalent with respect to the Foreign
Subsidiaries) duly signed in blank, (y) the limited liability company
certificates representing all of the ownership interest in In-
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Flight Entertainment, LLC, together with an undated transfer power duly signed
in blank and (z) such Uniform Commercial Code financing statements as the
Administrative Agent shall request.
(k) SENIOR NOTES. A certificate of a senior financial officer of
the Company, dated the Amendment Effective Date, stating that the Company's
9-3/4% Senior Notes due 2003 have been fully redeemed.
(l) OTHER DOCUMENTS. Such other documents as the Administrative
Agent or any Lender or special New York counsel to Chase may reasonably request.
6.02 INITIAL AND SUBSEQUENT EXTENSIONS OF CREDIT. The obligation
of the Lenders to make any Loan or otherwise extend any credit to the Company
upon the occasion of each borrowing or other extension of credit hereunder
(including the initial borrowing) is subject to the further conditions precedent
that:
(a) Both immediately prior to the making of such Loan or other
extension of credit and also after giving effect thereto and to the intended use
thereof: (i) no Default shall have occurred and be continuing; (ii) the
representations and warranties made by the Company in Section 7 hereof, and in
each of the other Basic Documents, shall be true and correct on and as of the
date of the making of such Loan or other extension of credit with the same force
and effect as if made on and as of such date (or, if any such representation or
warranty is expressly stated to have been made as of a specific date, as of such
specific date). Each notice of borrowing or request for the issuance of a Letter
of Credit by the Company hereunder shall constitute a certification by the
Company to the effect set forth in the preceding sentence (both as of the date
of such notice or request and, unless the Company otherwise notifies the
Administrative Agent prior to the date of such borrowing or issuance, as of the
date of such borrowing or issuance); and
(b) The Administrative Agent shall have received a certificate of
a senior financial officer of the Company setting forth in reasonable detail the
computations necessary to demonstrate that both immediately prior to the making
of such Loan or other extension of credit and immediately after giving effect
thereto, the Company is or will be in compliance with Section 1010 of the Senior
Subordinated Indentures.
Section 7. REPRESENTATIONS AND WARRANTIES. The Company represents
and warrants to the Lenders that:
7.01 CORPORATE EXISTENCE. Each of the Company and its
Subsidiaries: (a) is a corporation, partnership or other entity duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization; (b) has all requisite corporate or other power, and has all
material governmental licenses, authorizations, consents and approvals necessary
to own its assets and carry on its business as now being or as proposed to be
conducted; and (c) is qualified to do business and is in good standing in all
jurisdictions in which
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the nature of the business conducted by it makes such qualification necessary
and where failure so to qualify could have a Material Adverse Effect.
7.02 FINANCIAL CONDITION.
(a) The Company has heretofore furnished to each of the Lenders
(i) the consolidated balance sheet of the Company and its Subsidiaries as at
February 22, 1997 and the related consolidated statements of operations,
stockholders' equity and cash flows of the Company and its Subsidiaries for the
fiscal year ended on said date, with the opinion thereon of Deloitte & Touche,
and (ii) the consolidated balance sheet of the Company and its Subsidiaries as
at November 29, 1997 and the related consolidated statements of earnings,
stockholders' equity and cash flows of the Company and its Subsidiaries for the
fiscal quarters ended on such date and for the three fiscal quarters ended on
such date. All such financial statements present fairly, in all material
respects, the financial position of the Company and its Subsidiaries as at, and
the results of operations for the fiscal year and fiscal quarter, ended on said
date, all in accordance with generally accepted accounting principles and
practices applied on a consistent basis (subject, in the case of such financial
statements as at November 29, 1997, to normal year-end audit adjustments).
Neither the Company nor any of its Subsidiaries has on the Restatement Date any
material contingent liabilities, liabilities for taxes, unusual forward or
long-term commitments or unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided for in said balance
sheets as at said dates.
(b) Since February 22, 1997, there has been no material adverse
change in the financial condition, operations, business or prospects of the
Company and its Subsidiaries from that set forth in said financial statements as
at said date.
7.03 LITIGATION. Except as disclosed to the Lenders in writing
prior to the Amendment Effective Date, there are no legal or arbitral
proceedings, or any proceedings by or before any governmental or regulatory
authority or agency, now pending or (to the knowledge of the Company) threatened
against the Company or any of its Subsidiaries which, if adversely determined,
could have a Material Adverse Effect.
7.04 NO BREACH. None of the execution and delivery of this
Agreement and the Notes and the other Basic Documents, the consummation of the
transactions herein and therein contemplated or compliance with the terms and
provisions hereof and thereof will conflict with or result in a breach of, or
require any consent under, the charter or by-laws of the Company, or any
applicable law or regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency, or any agreement or instrument to
which the Company or any of its Subsidiaries is a party (including, without
limitation, the Senior Subordinated Indentures) or by which any of them or any
of their Property is bound or to which any of them is subject, or constitute a
default under any such agreement or instrument, or (except for Liens created
pursuant to the Security Documents) result in the creation or imposition of any
Lien upon any Property of the Company or any of its Subsidiaries pursuant to the
terms of any such agreement or instrument.
CREDIT AGREEMENT
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7.05 ACTION. The Company has all necessary corporate power,
authority and legal right to execute, deliver and perform its obligations under
each of the Basic Documents; the execution, delivery and performance by the
Company of each of the Basic Documents have been duly authorized by all
necessary corporate action on its part (including, without limitation, any
required shareholder approvals); and this Agreement has been duly and validly
executed and delivered by the Company and constitutes, and each of the Notes and
the other Basic Documents to which it is a party when executed and delivered (in
the case of the Notes, for value) will constitute, its legal, valid and binding
obligation, enforceable against the Company in accordance with its terms, except
as such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws of general applicability affecting the enforcement of
creditors' rights and the application of general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
7.06 APPROVALS. No authorizations, approvals or consents of, and
no filings or registrations with, any governmental or regulatory authority or
agency, or any securities exchange, are necessary for the execution, delivery or
performance by the Company of the Basic Documents to which it is a party or for
the legality, validity or enforceability hereof or thereof, except for filings
and recordings in respect of the Liens created pursuant to the Security
Documents.
7.07 USE OF CREDIT. Neither the Company nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose, whether immediate, incidental
or ultimate, of buying or carrying Margin Stock, and no part of the proceeds of
any extension of credit hereunder will be used to buy or carry any Margin Stock.
7.08 ERISA. Each Plan, and, to the knowledge of the Company, each
Multiemployer Plan, is in compliance in all material respects with, and has been
administered in all material respects in compliance with, the applicable
provisions of ERISA, the Code and any other Federal or State law, and no event
or condition has occurred and is continuing as to which the Company would be
under an obligation to furnish a report to the Lenders under Section 8.01(f)
hereof.
7.09 TAXES. The Company and its Domestic Subsidiaries are members
of an affiliated group of corporations filing consolidated returns for Federal
income tax purposes, of which the Company is the "common parent" (within the
meaning of Section 1504 of the Code) of such group. Except as set forth in
Schedule VI hereto, the Company and its Domestic Subsidiaries have filed all
Federal income tax returns and all other material tax returns that are required
to be filed by them and have paid all taxes due pursuant to such returns or
pursuant to any assessment received by the Company or any of its Domestic
Subsidiaries. The charges, accruals and reserves on the books of the Company and
its Subsidiaries in respect of taxes and other governmental charges are, in the
opinion of the Company, adequate. The Company has not given or been requested to
give a waiver of the statute of limitations relating to the payment of Federal,
state, local and foreign taxes or other impositions.
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7.10 INVESTMENT COMPANY ACT. Neither the Company nor any of its
Subsidiaries is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
7.11 PUBLIC UTILITY HOLDING COMPANY ACT. Neither the Company nor
any of its Subsidiaries is a "holding company", or an "affiliate" of a "holding
company" or a "subsidiary company" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
7.12 MATERIAL AGREEMENTS AND LIENS.
(a) Part A of Schedule I hereto is a complete and correct list,
as of the Restatement Date, of each credit agreement, loan agreement, indenture,
purchase agreement, guarantee, letter of credit or other arrangement providing
for or otherwise relating to any Indebtedness or any extension of credit (or
commitment for any extension of credit) to, or guarantee by, the Company or any
of its Subsidiaries the aggregate principal or face amount of which equals or
exceeds (or may equal or exceed) $1,000,000, and the aggregate principal or face
amount outstanding or that may become outstanding under each such arrangement is
correctly described in Part A of said Schedule I.
(b) Part B of Schedule I hereto is a complete and correct list,
as of the Restatement Date, of each Lien securing Indebtedness the aggregate
principal or face amount of which equals or exceeds $1,000,000 of any Person and
covering any Property of the Company or any of its Subsidiaries, and the
aggregate amount of such Indebtedness secured (or which may be secured) by each
such Lien and the Property covered by each such Lien is correctly described in
Part B of said Schedule I.
7.13 ENVIRONMENTAL MATTERS. Except as set forth in Schedule II
hereto, each of the Company and its Subsidiaries has obtained all environmental,
health and safety permits, licenses and other authorizations required under all
Environmental Laws to carry on its business as now being or as proposed to be
conducted, except to the extent failure to have any such permit, license or
authorization would not have a Material Adverse Effect. All of the permits,
licenses and authorizations that have been obtained are in full force and effect
and each of the Company and its Subsidiaries is in compliance with the terms and
conditions thereof, and is also in compliance with all other limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in any applicable Environmental Law or in any
regulation, code, plan, order, decree, judgment, injunction, notice or demand
letter issued, entered, promulgated or approved thereunder, except to the extent
failure to comply therewith would not have a Material Adverse Effect.
In addition, except as set forth in Schedule II hereto:
(a) To the Company's knowledge after due inquiry, no written
notice, notification, demand, request for information, citation, summons or
order has been issued, no complaint has been filed, no penalty has been assessed
and no investigation or review is pending
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or threatened by any governmental or other entity with respect to any alleged
failure by the Company or any of its Subsidiaries to have any environmental,
health or safety permit, license or other authorization required under any
Environmental Law in connection with the conduct of the business of the Company
or any of its Subsidiaries or with respect to any generation, treatment,
storage, recycling, transportation, discharge or disposal, or any Release of any
Hazardous Materials generated by the Company or any of its Subsidiaries.
(b) Neither the Company nor any of its Subsidiaries owns,
operates or leases a treatment, storage or disposal facility requiring a permit
under the Resource Conservation and Recovery Act of 1976, as amended, or under
any comparable state or local statute; and
(i) to the Company's knowledge after due inquiry, no PCB
Transformers (as defined in the Toxic Substances Control Act, 15 U.S.C.
ss.1601, et seq., as amended, and the regulations relating thereto) are
present at any site or facility owned, operated or leased by the Company
or any of its Subsidiaries;
(ii) to the Company's knowledge after due inquiry, no asbestos or
asbestos-containing materials is present at any site or facility owned,
operated or leased by the Company or any of its Subsidiaries;
(iii) to the Company's knowledge after due inquiry, there are no
underground storage tanks or surface impoundments for Hazardous
Materials, active or abandoned, at any site or facility owned, operated
or leased by the Company or any of its Subsidiaries; and
(iv) to the Company's knowledge after due inquiry, no Hazardous
Materials have been Released by the Company or any of its Subsidiaries
at, on or under any site or facility now owned, operated or leased by
the Company or any of its Subsidiaries in a reportable quantity
established by any Environmental Law.
(c) To the Company's knowledge after due inquiry, neither the
Company nor any of its Subsidiaries has transported or arranged for the
transportation of any Hazardous Material to any location that is listed on the
National Priorities List ("NPL") under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"), listed for
possible inclusion on the NPL by the Environmental Protection Agency, or listed
in the Comprehensive Environmental Response and Liability Information System, as
provided for by 40 C.F.R. ss. 300.5 ("CERCLIS"), or on any similar state or
local list or that is the subject of Federal, state or local enforcement actions
or other investigations that may lead to Environmental Claims against the
Company or any of its Subsidiaries.
(d) No Liens are presently recorded with the appropriate land
records under or pursuant to any Environmental Laws on any site or facility
owned, operated or leased by the Company or any of its Subsidiaries, and to the
Company's knowledge no government action has been taken or is in process that
could subject any such site or facility to such Liens. Neither the Company nor
any of its Subsidiaries would be required to place any notice or restriction
relating
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to the presence of Hazardous Materials at any site or facility owned by it in
any deed to the real property on which such site or facility is located.
(e) There have been no environmental investigations, written
studies, audits, tests, reviews or other analyses conducted by or that are in
the possession of the Company or any of its Subsidiaries in relation to any site
or facility now or previously owned, operated or leased by the Company or any of
its Subsidiaries which have not been made available to the Lenders.
7.14 CAPITALIZATION. The authorized capital stock of the Company
consists, on the Restatement Date, of an aggregate of 31,000,000 shares
consisting of (i) 30,000,000 shares of common stock, par value $0.01 per share,
of which 22,891,918 shares were, as at February 28, 1998 duly and validly issued
and outstanding, each of which shares is fully paid and nonassessable and (ii)
1,000,000 shares of preferred stock, par value $0.01 per share, of which no
shares were outstanding as at February 28, 1998. As of the Restatement Date the
Company is registered with the Securities and Exchange Commission under the
Securities Exchange Act, and its shares of common stock are publicly owned and
traded on the NASDAQ National Market System. As of the Restatement Date, (x)
except for options to purchase 2,902,001 shares of the common stock of the
Company, there are no outstanding Equity Rights with respect to the Company and
(y) there are no outstanding obligations of the Company or any of its
Subsidiaries to repurchase, redeem, or otherwise acquire any shares of capital
stock of the Company nor are there any outstanding obligations of the Company or
any of its Subsidiaries to make payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference to the fair
market value or equity value of the Company or any of its Subsidiaries.
7.15 SUBSIDIARIES, ETC.
(a) Set forth in Part A of Schedule III hereto is a complete and
correct list, as of the Restatement Date, of all of the Subsidiaries of the
Company, together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding ownership interests in
such Subsidiary, (iii) the nature of the ownership interests held by each such
Person and the percentage of ownership of such Subsidiary represented by such
ownership interests and (iv) the total book value of the assets of each such
Subsidiary as of November 29, 1997. Except as disclosed in Part A of Schedule
III hereto, (x) each of the Company and its Subsidiaries owns, free and clear of
Liens (other than Liens created pursuant to the Security Documents), and has the
unencumbered right to vote, all outstanding ownership interests in each Person
shown to be held by it in Part A of Schedule III hereto, (y) all of the issued
and outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (z) there are no outstanding
Equity Rights with respect to such Person.
(b) Set forth in Part B of Schedule III hereto is a complete and
correct list, as of the Restatement Date, of all Investments (other than
Investments disclosed in Part A of said Schedule III hereto) of $1,000,000 or
more held by the Company or any of its Subsidiaries in any Person and, for each
such Investment, (x) the identity of the Person or Persons in which such
Investment has been made, (y) the nature of such Investment and (z) the amount
of such
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Investment. Except as disclosed in Part B of Schedule III hereto, each of the
Company and its Subsidiaries owns, free and clear of all Liens (other than Liens
created pursuant to the Security Documents), all such Investments.
(c) Except as set forth in Schedule III hereto, none of the
Subsidiaries of the Company is, on the Restatement Date, subject to any
indenture, agreement, instrument or other arrangement of the type described in
the last sentence of Section 8.17 hereof.
7.16 TITLE TO ASSETS. The Company owns and has on the Restatement
Date, and will own and have on the Amendment Effective Date, good and marketable
title (subject only to Liens permitted by Section 8.06 hereof) to the Properties
shown to be owned in the most recent financial statements referred to in Section
7.02 hereof (other than Properties disposed of in the ordinary course of
business or otherwise permitted to be disposed of pursuant to Section 8.05
hereof). The Company owns and has on the Restatement Date, and will own and have
on the Amendment Effective Date, good and marketable title to, and enjoys on the
Restatement Date, and will enjoy on the Amendment Effective Date, peaceful and
undisturbed possession of, all Properties (subject only to Liens permitted by
Section 8.06 hereof) that are necessary for the operation and conduct of its
businesses.
7.17 COMPLIANCE WITH LAW. Except as set forth in Schedule IV
hereto, each of the Company and its Subsidiaries is in compliance with all
applicable laws, rules, regulations and orders of, and all applicable
restrictions imposed by, all governmental authorities or bodies, domestic or
foreign, in respect of the conduct of its business and the ownership of its
Property (including Environmental Laws), except such noncompliance as would not,
in the aggregate, have a Material Adverse Effect on the business, properties,
assets, operations, condition (financial or otherwise), or prospects of the
Company and its Subsidiaries, taken as a whole.
7.18 TRUE AND COMPLETE DISCLOSURE. The information, reports,
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Company to the Administrative Agent or any Lender prior to the
Amendment Effective Date in connection with the negotiation, preparation or
delivery of this Agreement and the other Basic Documents or included herein or
therein or delivered pursuant hereto or thereto, when taken as a whole (together
with the Information Memorandum which the Lenders acknowledge contains
projections based on certain assumptions therein stated) do not contain any
untrue statement of material fact or omit to state any material fact necessary
to make the statements herein or therein, in light of the circumstances under
which they were made, not misleading. All written information furnished on or
after the Amendment Effective Date by the Company and its Subsidiaries to the
Administrative Agent and the Lenders in connection with this Agreement and the
other Basic Documents and the transactions contemplated hereby and thereby will
be true, complete and accurate in every material respect, or (in the case of
projections) based on reasonable estimates, on the date as of which such
information is stated or certified. There is no fact known to the Company that
could have a Material Adverse Effect that has not been disclosed herein, in the
other Basic Documents or in a report, financial statement, exhibit,
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schedule, disclosure letter or other writing furnished to the Lenders for use in
connection with the transactions contemplated hereby or thereby.
7.19 YEAR 2000. Substantially all reprogramming required to
permit the proper functioning, in and following the year 2000, of (i) the
Company's computer systems and (ii) equipment containing embedded microchips
(including systems and equipment supplied by others or with which the Company's
systems interface) and the testing of all such systems and equipment, as so
reprogrammed, will be materially completed by July 1, 1999. The cost to the
Company of such reprogramming and testing and of the reasonable foreseeable
consequences of year 2000 to the Company (including, without limitation,
reprogramming errors and the failure of others' systems or equipment) will not
result in a Default or a Material Adverse Effect. Nothing herein shall preclude
the Company from making the foregoing representation after the making of an
Acquisition of any Person that is not in compliance with the above, so long as
the Company has prepared a plan prior to such Acquisition that sets forth, in
the reasonable judgment of the chief financial officer of the Company, the
action that the Company has taken or proposes to take to bring such Person into
compliance with the above.
Section 8. COVENANTS OF THE COMPANY. The Company covenants and
agrees with the Lenders and the Administrative Agent that, so long as any
Commitment, Loan or Letter of Credit Liability is outstanding and until payment
in full of all amounts payable by the Company hereunder:
8.01 FINANCIAL STATEMENTS, ETC. The Company shall deliver to each
of the Lenders:
(a) as soon as available and in any event within 60 days after
the end of each of the first three quarterly fiscal periods of each fiscal year
of the Company, consolidated statements of earnings, stockholders' equity and
cash flows of the Company and its Subsidiaries, for such period and for the
period from the beginning of the respective fiscal year to the end of such
period, setting forth in each case in comparative form the corresponding
consolidated figures for the corresponding period in the preceding fiscal year,
and the related consolidated balance sheet of the Company and its Subsidiaries,
as at the end of such period, setting forth in comparative form the
corresponding consolidated figures for the last day of the preceding fiscal
year, accompanied by a certificate of a senior financial officer of the Company,
which certificate shall state that said consolidated financial statements
present fairly, in all material respects, the consolidated financial condition
and results of operations of the Company and its Subsidiaries, in accordance
with generally accepted accounting principles, consistently applied, as at the
end of, and for, such period (subject to normal year-end audit adjustments);
(b) as soon as available and in any event within 105 days after
the end of each fiscal year of the Company, consolidated and consolidating
statements of operations and stockholders' equity of the Company and its
Subsidiaries, and consolidated statements of cash flows of the Company and its
Subsidiaries, for such fiscal year and the related consolidated and
consolidating balance sheets of the Company and its Subsidiaries as at the end
of such fiscal
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year, setting forth in each case in comparative form the corresponding
consolidated and consolidating figures for the preceding fiscal year, and
accompanied, (i) in the case of said consolidated statements and balance sheet
of the Company, by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall state that said
consolidated financial statements present fairly, in all material respects, the
consolidated financial condition and results of operations of the Company and
its Subsidiaries as at the end of, and for, such fiscal year in accordance with
generally accepted accounting principles, and a report of such accountants
stating that, in making the examination necessary for their opinion, nothing
came to their attention, except as specifically stated, that caused them to
believe that the Company had failed to comply with Sections 8.09, 8.10, 8.11 and
8.12 hereof, or any other provisions hereof, insofar as they relate to
accounting matters, and (ii) in the case of said consolidating statements and
balance sheets, by a certificate of a senior financial officer of the Company
which certificate shall state that said consolidating financial statements
fairly present the respective individual unconsolidated financial condition and
results of operations of the Company and of each of its Subsidiaries, in each
case in accordance with generally accepted accounting principles, consistently
applied, as at the end of, and for, such fiscal year;
(c) as soon as available and in any event within 105 days after
the end of each fiscal year of the Company, statements of information concerning
net sales, operating earnings, depreciation and amortization of each division of
the Company and its Subsidiaries (including, without limitation, the Seating
Products Division, Galley Products Division, In-Flight Entertainment Division
and Service Division) for such period setting forth in each case in comparative
form the corresponding figures for the preceding fiscal year;
(d) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any, which the Company
shall have filed with the Securities and Exchange Commission (or any
governmental agency substituted therefor) or any national securities exchange;
(e) promptly upon the mailing thereof to the shareholders of the
Company generally, copies of all financial statements, reports and proxy
statements so mailed;
(f) as soon as possible, and in any event within ten days after
the Company knows or has reason to believe that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan has occurred or
exists, a statement signed by a senior financial officer of the Company setting
forth details respecting such event or condition and the action, if any, that
the Company or its ERISA Affiliate proposes to take with respect thereto (and a
copy of any report or notice required to be filed with or given to PBGC by the
Company or an ERISA Affiliate with respect to such event or condition):
(i) any reportable event, as defined in Section 4043(b) of ERISA
and the regulations issued thereunder, with respect to a Plan, as to
which PBGC has not by regulation waived the requirement of Section
4043(a) of ERISA that it be notified within 30 days of the occurrence of
such event (PROVIDED that a failure to meet the minimum funding standard
of Section 412 of the Code or Section 302 of ERISA, including, without
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limitation, the failure to make on or before its due date a required
installment under Section 412(m) of the Code or Section 302(e) of ERISA,
shall be a reportable event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code); and any request for a
waiver under Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of ERISA of a notice of
intent to terminate any Plan or any action taken by the Company or an
ERISA Affiliate to terminate any Plan;
(iii) the institution by PBGC of proceedings under Section 4042
of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by the Company or any ERISA
Affiliate of a notice from a Multiemployer Plan that such action has
been taken by PBGC with respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a Multiemployer Plan
by the Company or any ERISA Affiliate that results in liability under
Section 4201 or 4204 of ERISA (including the obligation to satisfy
secondary liability as a result of a purchaser default) or the receipt
by the Company or any ERISA Affiliate of notice from a Multiemployer
Plan that it is in reorganization or insolvency pursuant to Section 4241
or 4245 of ERISA or that it intends to terminate or has terminated under
Section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of any
Multiemployer Plan against the Company or any ERISA Affiliate to enforce
Section 515 of ERISA, which proceeding is not dismissed within 30 days;
and
(vi) the adoption of an amendment to any Plan that, pursuant to
Section 401(a)(29) of the Code or Section 307 of ERISA, would result in
the loss of tax-exempt status of the trust of which such Plan is a part
if the Company or an ERISA Affiliate fails to timely provide security to
the Plan in accordance with the provisions of said Sections;
(g) promptly after the Company knows or has reason to believe
that any Default has occurred, a notice of such Default describing the same in
reasonable detail and, together with such notice or as soon thereafter as
possible, a description of the action that the Company has taken or proposes to
take with respect thereto;
(h) Within 10 Business Days after the date of any Acquisition and
at the time of delivery of the financial statements for the first four Fiscal
Dates thereafter, PRO FORMA consolidated statements of earnings of the Company
and its Subsidiaries for the relevant Calculation Period and related PRO FORMA
consolidated balance sheet items necessary for the PRO FORMA calculation of
compliance with the covenants in this Agreement of the Company and its
Subsidiaries as of the last day of each fiscal quarter of the Company occurring
during such Calculation Period, prepared as though such Acquisition had
occurred, and any Funded Debt
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incurred or assumed by the Company or any of its Subsidiaries in connection with
such Acquisition had been incurred or assumed, on the first day of such
Calculation Period;
(i) with the delivery of the financial statements pursuant to
Sections 8.01(a) and 8.01(b) hereof, a statement of a senior financial officer
of the Company (A) listing each Disposition by the Company and its Subsidiaries
that occurred during the quarterly fiscal period ending on the date of such
financial statements if the Net Available Proceeds thereof exceeded $100,000 and
(B) setting forth in reasonable detail the Net Available Proceeds of each such
Disposition and the aggregate Net Available Proceeds since the first day of the
then current Recapture Period; and
(j) from time to time such other information regarding the
financial condition, operations, business or prospects of the Company or any of
its Subsidiaries (including, without limitation, any Plan or Multiemployer Plan
and any reports or other information required to be filed under ERISA) as any
Lender or the Administrative Agent may reasonably request.
The Company will furnish to each Lender, at the time it furnishes each set of
financial statements pursuant to paragraph (a), (b) or (h) above, a certificate
of a senior financial officer of the Company (i) to the effect that no Default
has occurred and is continuing (or, if any Default has occurred and is
continuing, describing the same in reasonable detail and describing the action
that the Company has taken or proposes to take with respect thereto) and (ii)
setting forth in reasonable detail (x) the computations necessary to determine
whether the Company is in compliance with Sections 8.07(e), 8.07(g), 8.08(f),
8.08(h), 8.09, 8.10, 8.11 and 8.12 hereof, and (y) the Interest Coverage Ratio
and the Leverage Ratio as of the end of the respective quarterly fiscal period,
fiscal year or Calculation Period.
8.02 LITIGATION. The Company will promptly give to each Lender
notice of all legal or arbitral proceedings, and of all proceedings by or before
any governmental or regulatory authority or agency, and any material development
in respect of such legal or other proceedings, affecting the Company or any of
its Subsidiaries, except proceedings which, if adversely determined, would not
have a Material Adverse Effect. Without limiting the generality of the
foregoing, the Company will give to each Lender notice of the assertion of any
Environmental Claim by any Person against, or with respect to the activities of,
the Company or any of its Subsidiaries and notice of any alleged violation of or
non-compliance with any Environmental Laws or any permits, licenses or
authorizations, other than any Environmental Claim or alleged violation which,
if adversely determined, would not have a Material Adverse Effect.
8.03 EXISTENCE, ETC. The Company will, and will cause each of its
Subsidiaries to:
(a) preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises (PROVIDED that nothing in
this Section 8.03 shall prohibit any transaction expressly permitted under
Section 8.05 hereof);
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(b) comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if failure to
comply with such requirements could have a Material Adverse Effect;
(c) pay and discharge all taxes, assessments and governmental
charges or levies imposed on it or on its income or profits or on any of its
Property prior to the date on which penalties attach thereto, except for any
such tax, assessment, charge or levy the payment of which is being contested in
good faith and by proper proceedings and against which adequate reserves are
being maintained;
(d) maintain all of its Properties used or useful in its business
in good working order and condition, ordinary wear and tear excepted;
(e) keep adequate records and books of account, in which complete
entries will be made in accordance with generally accepted accounting principles
consistently applied; and
(f) permit representatives of any Lender or the Administrative
Agent, during normal business hours, to examine, copy and make extracts from its
books and records, to inspect any of its Properties, and to discuss its business
and affairs with its officers, all to the extent reasonably requested by such
Lender or the Administrative Agent (as the case may be).
8.04 INSURANCE. The Company will, and will cause each of its
Subsidiaries to, keep insured by financially sound and reputable insurers all
Property of a character usually insured by corporations engaged in the same or
similar business similarly situated against loss or damage of the kinds and in
the amounts customarily insured against by such corporations and carry such
other insurance as is usually carried by such corporations.
8.05 PROHIBITION OF FUNDAMENTAL CHANGES. The Company will not,
nor will it permit any of its Subsidiaries to, enter into any transaction of
merger or consolidation or amalgamation, or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution) or Dispose of all or
substantially all of its Property. The Company will not, nor will it permit any
of its Subsidiaries to, to make any Acquisition except for Investments permitted
under Section 8.08 hereof. Notwithstanding the foregoing provisions of this
Section 8.05:
(a) any Subsidiary of the Company may be merged or consolidated
with or into: (i) the Company if the Company shall be the continuing or
surviving corporation or (ii) any other such Subsidiary; PROVIDED that (x) if
any such transaction shall be between a Subsidiary and a Wholly Owned
Subsidiary, the Wholly Owned Subsidiary shall be the continuing or surviving
corporation;
(b) subject to Section 8.14 hereof, the Company or any Subsidiary
of the Company may make any Acquisition; PROVIDED that immediately prior to and
after giving effect to any such Acquisition, (i) no Default shall have occurred
and be continuing, (ii) not more than $25,000,000 of the proceeds of the Series
A Loans then outstanding shall have been applied,
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directly by the Company or indirectly through a Subsidiary, to the purchase
price of one or more Acquisitions; and
(c) the Company or any Subsidiary of the Company may make any
Acquisition from any Subsidiary of the Company in each case for consideration
that is not in excess of the fair market value of the Property acquired in such
Acquisition as determined in good faith by the chief financial officer of the
Company.
8.06 LIMITATION ON LIENS. The Company will not, nor will it
permit any of its Domestic Subsidiaries to, create, incur, assume or suffer to
exist any Lien upon any of its Property, whether now owned or hereafter
acquired, except:
(a) Liens created pursuant to the Security Documents;
(b) Liens outstanding on the Restatement Date and listed in Part
B of Schedule I hereto;
(c) Liens imposed by any governmental authority for taxes,
assessments or charges not yet due or which are being contested in good faith
and by appropriate proceedings if, unless the amount thereof is not material
with respect to it or its financial condition, adequate reserves with respect
thereto are maintained on the books of the Company or the affected Domestic
Subsidiaries, as the case may be, in accordance with GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings and Liens securing judgments but
only to the extent, for an amount and for a period not resulting in an Event of
Default under Section 9(h) hereof;
(e) pledges or deposits under worker's compensation, unemployment
insurance and other social security legislation;
(f) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature incurred
in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business and encumbrances
consisting of zoning restrictions, easements, licenses, restrictions on the use
of Property or minor imperfections in title thereto which, in the aggregate, are
not material in amount, and which do not in any case materially detract from the
value of the Property subject thereto or interfere with the ordinary conduct of
the business of the Company or any of its Domestic Subsidiaries;
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(h) Liens on Property of any corporation which becomes a Domestic
Subsidiary of the Company after the Restatement Date, PROVIDED that such Liens
are in existence at the time such corporation becomes a Domestic Subsidiary of
the Company and were not created in anticipation thereof;
(i) subject to the restrictions contained in the Security
Documents, Liens upon real and/or tangible personal Property and/or software and
license rights with respect to software (including, without limitation, software
and license rights with respect to software under the GE Lease Agreement)
acquired after the Restatement Date (by purchase, construction or otherwise) by
the Company or any of its Domestic Subsidiaries other than in connection with
any Acquisition by the Company or any of its Domestic Subsidiaries, each of
which Liens either (A) existed on such Property before the time of its
acquisition and was not created in anticipation thereof, or (B) was created
solely for the purpose of securing Indebtedness representing, or incurred to
finance, refinance or refund, the cost (including the cost of construction) of
such Property; PROVIDED that no such Lien shall extend to or cover any Property
of the Company or such Domestic Subsidiary other than the Property so acquired
and improvements thereon; and PROVIDED, FURTHER, that the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 100% of the fair
market value (as determined in good faith by a senior financial officer of the
Company) of such Property at the time it was acquired (by purchase, construction
or otherwise);
(j) additional Liens upon real and/or tangible personal Property
of the Company or any of its Domestic Subsidiaries created after the Restatement
Date, PROVIDED that the aggregate Indebtedness secured thereby and incurred on
and after the Restatement Date shall not exceed $20,000,000 in the aggregate at
any one time outstanding; and
(k) any extension, renewal or replacement of the foregoing,
PROVIDED, however, that the Liens permitted hereunder shall not be spread to
cover any additional Indebtedness or Property (other than a substitution of like
Property).
8.07 INDEBTEDNESS. The Company will not, nor will it permit any
of its Subsidiaries to, create, incur or suffer to exist any Indebtedness
except:
(a) Indebtedness to the Lenders hereunder;
(b) Indebtedness outstanding or committed on the Restatement Date
and, if equal to or in excess of $1,000,000, listed in Part A of Schedule I
hereto and any extension, renewal or replacement thereof;
(c) Indebtedness of Subsidiaries of the Company to the Company to
the extent contemplated by Section 8.08(d) hereof;
(d) Indebtedness of the Company to its Subsidiaries and
Indebtedness of Subsidiaries of the Company to other Subsidiaries of the
Company;
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(e) Indebtedness of the Company and its Subsidiaries secured by
Liens permitted under Sections 8.06(i) and 8.06(j) hereof;
(f) Guarantees by any Subsidiary of the Company of Indebtedness
of the Company or any Subsidiary of the Company;
(g) unsecured Indebtedness that has no regularly scheduled
maturity or mandatory prepayments on or before the Series A Commitment
Termination Date, that does not include required prepayments (including, without
limitation, as a result of a change of control or asset sale) on terms less
favorable to the Lenders than the Senior Subordinated Indentures, and that is
subordinated in right of payment to the Loans at least to the extent provided in
the Senior Subordinated Indentures; and
(h) additional unsecured Indebtedness of the Company and its
Subsidiaries up to but not exceeding in the aggregate $40,000,000 at any one
time outstanding; PROVIDED that any such Indebtedness of any such individual
Subsidiary may not exceed $10,000,000 in the aggregate at any one time
outstanding.
8.08 INVESTMENTS. The Company will not, nor will it permit any of
its Subsidiaries to, make or permit to remain outstanding any Investments
except:
(a) Investments outstanding on the Restatement Date and
identified in Schedule III Part B hereto;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) Investments by the Company in Subsidiaries of the Company in
the ordinary course of business; PROVIDED that the aggregate amount of the
Investments by the Company or any of its Subsidiaries in the Specified
Subsidiaries shall not exceed $5,000,000 at any one time outstanding; PROVIDED
FURTHER, that the Company will not at any time transfer any Property to any one
or more Subsidiaries which, together with all Property so transferred since the
Restatement Date, has a book value at the time of such transfer in excess of 5%
of Adjusted Net Worth as of the most recent Fiscal Date (not including Property
that is subject to a Lien in favor of the Administrative Agent for the benefit
of the Lenders);
(e) subject to the first proviso to clause (d) above, Investments
by Subsidiaries of the Company in other Subsidiaries of the Company and in the
Company in the ordinary course of business;
(f) Interest Rate Protection Agreements so long as the aggregate
credit exposure under all Interest Rate Protection Agreements calculated at the
time any Interest Rate Protection Agreement is entered into does not exceed
$10,000,000;
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(g) Investments permitted by clause (b) of the last sentence of
Section 8.05 hereof; and
(h) Investments of the Company and its Subsidiaries (i) in
corporations, companies, limited liability companies, partnerships and other
entities in each case that are not, or do not thereby become, Subsidiaries of
the Company ("Minority-Owned Entities") or (ii) representing obligations of
customers owing to the Company and its Subsidiaries in respect of the deferred
purchase price of products or services sold or the leasing of products to
customers ("Customer Obligations"), in each case in the ordinary course of
business of the Company and its Subsidiaries as provided for in Section 8.14
hereof and on such terms as the management of the Company may determine in its
reasonable business judgment, PROVIDED that the aggregate amount of such
Customer Obligations that are not fully secured (whether by a perfected Lien on,
or an indefeasible title retention to, the products so sold or leased, or
otherwise) PLUS the aggregate fair market value of all Property (whether now
owned or hereafter acquired) of the Company or any of its Subsidiaries (as
determined in good faith by the chief financial officer of the Company) sold,
assigned, transferred or otherwise disposed of on or after the Restatement Date
to any such Minority-Owned Entities shall not exceed in the aggregate at any one
time outstanding the greater of (i) $25,000,000 and (ii) 5% of Adjusted Net
Worth.
8.09 RESTRICTED PAYMENTS. The Company will not, nor will it
permit any of its Subsidiaries to, declare or make any Restricted Payment at any
time; PROVIDED that (i) the Company may make Restricted Payments in an amount up
to but not exceeding (A) $25,000,000 in the aggregate PLUS (B) in any fiscal
year of the Company, an aggregate amount up to but not exceeding 25% of the net
earnings of the Company for the immediately preceding fiscal year ("AVAILABLE
NET EARNINGS"), PROVIDED that any portion of Available Net Earnings not used for
Restricted Payments in any fiscal year (the "CARRY-OVER AMOUNT") may be used for
Restricted Payments in the immediately succeeding fiscal year only, for which
purpose Restricted Payments in any fiscal year shall be deemed to have been made
first from Available Net Earnings, and only thereafter from any Carry-Over
Amount, such Restricted Payments set forth in clauses (i)(A) and (B) hereof not
to exceed $50,000,000 in the aggregate, and (ii) any Subsidiary of the Company
may make Restricted Payments to the Company from time to time.
8.10 LEVERAGE RATIO. The Company will not permit the Leverage
Ratio to exceed the following respective ratios at any time during the following
respective periods:
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Period Ratio
------ -----
From (but not including) the
Fiscal Date in November 1997
through the Fiscal Date in
August 1998 5.25 to 1
From (but not including) the
Fiscal Date in August 1998
through the Fiscal Date in
February 1999 4.90 to 1
From (but not including) the
Fiscal Date in February 1999
through the Fiscal Date in
February 2000 4.50 to 1
From (but not including) the
Fiscal Date in February 2000
through the Fiscal Date in
February 2001 4.00 to 1
Thereafter 3.50 to 1
8.11 ADJUSTED NET WORTH. The Company will not at any date permit
Adjusted Net Worth to be less than the sum of (a) $150,000,000 PLUS (b) 75% of
the aggregate amount of Net Available Proceeds of Equity Issuances received
after November 29,1997 PLUS (c) 75% of the sum of consolidated net earnings of
the Company and its Subsidiaries (determined on a consolidated basis without
duplication in accordance with GAAP) for each fiscal quarter of the Company
ending after November 29, 1997; PROVIDED that consolidated net earnings for any
fiscal quarter in which there is a consolidated net loss shall be deemed to be
zero.
8.12 INTEREST COVERAGE RATIO. The Company will not permit the
Interest Coverage Ratio to be less than the following respective ratios during
the following respective periods:
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Period Ratio
------ -----
From (but not including) the
Fiscal Date in November 1997
through the Fiscal Date in
August 1998 2.00 to 1
From (but not including) the
Fiscal Date in August 1998
through the Fiscal Date in
February 1999 2.25 to 1
From (but not including) the
Fiscal Date in February 1999
through the Fiscal Date in
February 2000 2.50 to 1
From (but not including) the
Fiscal Date in February 2000
through the Fiscal Date in
February 2001 2.75 to 1
Thereafter 3.00 to 1
8.13 [INTENTIONALLY OMITTED.]
8.14 LINES OF BUSINESS. Neither the Company nor any of its
Subsidiaries shall engage to any substantial extent in any line or lines of
business activity other than the business of designing, manufacturing,
distributing, selling, leasing and servicing products used in the interior of
airplanes, buses and trains and servicing and acting as a broker in the sales
and leases of such products together with any other business reasonably related
to the foregoing.
8.15 TRANSACTIONS WITH AFFILIATES. Except as set forth in
Schedule VII hereto or as expressly permitted by this Agreement, the Company
will not, nor will it permit any of its Subsidiaries to, directly or indirectly:
(a) make any Investment in an Affiliate; (b) transfer, sell, lease, assign or
otherwise dispose of any Property to an Affiliate; (c) merge into or consolidate
with or purchase or acquire Property from an Affiliate; or (d) enter into any
other transaction directly or indirectly with or for the benefit of an Affiliate
(including, without limitation, guarantees and assumptions of obligations of an
Affiliate); PROVIDED that (x) any Affiliate who is an individual may serve as a
director, officer or employee of the Company or any of its Subsidiaries and
receive reasonable compensation for his or her services in such capacity and (y)
the Company and its Subsidiaries may enter into transactions (other than
extensions of credit by the Company or any of its Subsidiaries to an Affiliate)
providing for the leasing of Property, the rendering or receipt of services or
the purchase or sale of inventory and other Property in the
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ordinary course of business if the monetary or business consideration arising
therefrom would be substantially as advantageous to the Company and its
Subsidiaries as the monetary or business consideration which would obtain in a
comparable transaction with a Person not an Affiliate.
8.16 USE OF PROCEEDS. The Company will use the proceeds of (i)
the Series A Loans hereunder solely to finance ongoing working capital and other
capital requirements of the Company and to finance Acquisitions (subject to
clause (b) of the last sentence of Section 8.05) (in compliance with all
applicable legal and regulatory requirements) and (ii) the Series B Loans
hereunder solely to finance Acquisitions (subject to clause (b) of the last
sentence of Section 8.05); provided that neither the Administrative Agent nor
any Lender shall have any responsibility as to the use of any of such proceeds.
8.17 CERTAIN OBLIGATIONS RESPECTING SUBSIDIARIES.
(a) The Company will, and will cause each of its Subsidiaries to,
take such action from time to time as shall be necessary to ensure that the
Company and each of its Subsidiaries at all times owns (subject only to the Lien
of the Security Documents) at least the same percentage of the issued and
outstanding shares of each class of stock or partnership or other ownership
interest of each of its Subsidiaries as is owned on the Restatement Date (or,
with respect to any Subsidiary acquired or organized after the date hereof, as
of the date of such acquisition or organization). Without limiting the
generality of the foregoing, none of the Company nor any of its Subsidiaries
shall sell, transfer, pledge or otherwise dispose of any shares of stock or
partnership or other ownership interest in any Subsidiary owned by them, nor
permit any Subsidiary to issue any shares of stock of any class or partnership
or other ownership interest whatsoever to any Person (other than to the Company
or the immediate parent of such Subsidiary which is a Wholly Owned Subsidiary of
the Company). In the event that (a) any such additional shares of stock or
partnership or other ownership interest shall be issued by any such Subsidiary
or (b) the Company shall directly or indirectly create any new Material
Subsidiary or Acquire any additional Material Subsidiary and shall thereby
become the owner, directly or indirectly, of the shares of capital stock or
partnership or other ownership interest of such new or additional Material
Subsidiary, the Company agrees forthwith to deliver to the Administrative Agent
pursuant to security documents satisfactory to the Banks, any shares,
certificates of ownership, membership interests or other evidence of ownership,
or other securities received as a result therefrom (together with undated stock
or other powers executed in blank) and shall give, execute, deliver, file and/or
record any financing statement, notice, instrument, document, agreement or other
papers that may be necessary or desirable (in the judgment of the Administrative
Agent) to create, preserve or validate the security interest created therein,
including, without limitation, causing any or all of the Collateral (as defined
in the Security Agreement and the In-Flight Guarantee and Security Agreement,
respectively) to be transferred of record into the name of the Administrative
Agent; PROVIDED that if any such Material Subsidiary is organized under the laws
of a jurisdiction other than the United States of America or a State thereof,
the Company need not pledge to the Administrative Agent more than 65% of the
capital stock, partnership or other ownership interest in such Material
Subsidiary.
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(b) The Company will not permit any of its Subsidiaries to enter
into, after the Restatement Date, any indenture, agreement, instrument or other
arrangement that, directly or indirectly, prohibits or restrains, or has the
effect of prohibiting or restraining, or imposes materially adverse conditions
upon, the incurrence or payment of Indebtedness, the granting of Liens, the
declaration or payment of dividends, the making of loans, advances or
Investments or the sale, assignment, transfer or other disposition of Property.
8.18 MODIFICATIONS OF CERTAIN DOCUMENTS. The Company will not
consent to (i) any modification, supplement or waiver of any of the provisions
of the Senior Subordinated Indentures or (ii) to the creation of any class of
preferred stock that has a mandatory dividend or redemption date prior to the
Series A Commitment Termination Date; PROVIDED that any Senior Subordinated
Indenture may be amended in connection with, and to facilitate, the purchase,
redemption, prepayment, defeasance or other retirement in full of the
Indebtedness issued pursuant thereto, which purchase, redemption, prepayment,
defeasance or other retirement is permitted hereunder.
8.19 ENVIRONMENTAL MATTERS.
(a) The Company will, and will cause each of its Subsidiaries to,
comply with all Environmental Laws applicable to the Company and each of its
Subsidiaries, except to the extent that failure to comply with such laws would
not have a Material Adverse Effect, and shall obtain, at or prior to the time
required by applicable Environmental Laws, all environmental, health and safety
permits, licenses and other authorizations necessary for its operations and
maintain such authorizations in full force and effect.
(b) If the Company discovers evidence of the presence of any
Hazardous Materials in any amount that is required to be reported under
Environmental Law, the Company will promptly clean-up such Hazardous Materials
or take such other remedial action as is (a) required by law or (b) deemed
necessary by the Company in its reasonable determination, such determination to
be based in part on the advice of independent environmental consultants
acceptable to the Company and the Administrative Agent.
(c) The Company shall promptly furnish to the Administrative
Agent all written notices of any Environmental Claims received by the Company or
any of its Subsidiaries with respect to any alleged violation of or
non-compliance with any Environmental Laws or any permits, licenses or
authorizations issued thereunder in connection with the ownership, operation or
use of any site or facility or the operation of their businesses or the presence
or Release of Hazardous Substances, which Environmental Claim if determined
adversely to the Company would have a Material Adverse Effect.
8.20 SECURITY FOR LOANS. The Company shall, no later than 90 days
following the request by the Majority Lenders, file in each governmental office
or agency in each appropriate jurisdiction as owner of record of each of the
Foreign Trademarks identified on Annex 4 to the Security Agreement.
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8.21 REDEMPTION OF SENIOR SUBORDINATED INDEBTEDNESS. Except as
permitted by Section 8.09 hereof, the Company will not prepay, redeem, effect a
defeasance or covenant defeasance or otherwise retire any of the Indebtedness
issued pursuant to the Senior Subordinated Indentures.
Section 9. EVENTS OF DEFAULT. If one or more of the following
events (herein called "EVENTS OF DEFAULT") shall occur and be continuing:
(a) The Company shall (i) default in the payment of any principal
of any Loan or any Reimbursement Obligation when due (whether at stated maturity
or upon mandatory or optional prepayment) or (ii) default in the payment of any
interest on any Loan, any fee or any other amount payable by it hereunder or
under any other Basic Document when due (whether at stated maturity or upon
mandatory or optional prepayment or otherwise) and such default shall have
continued unremedied for three or more Business Days; or
(b) The Company or any of its Subsidiaries shall default in the
payment when due of any principal of or interest on any of its other
Indebtedness aggregating $5,000,000 or more, or in the payment when due of any
amount aggregating $5,000,000 or more under any Interest Rate Protection
Agreement; or any event specified in any note, agreement, indenture or other
document evidencing or relating to any such Indebtedness or any event specified
in any Interest Rate Protection Agreement shall occur if the effect of such
event is to cause, or (with the giving of any notice or the lapse of time or
both) to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause, such Indebtedness to become
due, or to be prepaid in full (whether by redemption, purchase, offer to
purchase or otherwise), prior to its stated maturity or to have the interest
rate thereon reset to a level so that securities evidencing such Indebtedness
trade at a level specified in relation to the par value thereof or, in the case
of an Interest Rate Protection Agreement, to permit the payments owing under
such Interest Rate Protection Agreement to be liquidated in an amount
aggregating $5,000,000 or more; or
(c) Any representation, warranty or certification made or deemed
made herein or in any other Basic Document (or in any modification or supplement
hereto or thereto) by the Company, or any certificate furnished to any Lender or
the Administrative Agent pursuant to the provisions hereof or thereof shall
prove to have been false or misleading in any material respect as of the time
made or furnished; or
(d) The Company shall default in the performance of any of its
obligations under any of Sections 8.01(g), 8.05, 8.06, 8.07, 8.08, 8.09, 8.10,
8.11 or 8.12 hereof or the Company shall default in the performance of any of
its obligations under Section 5.02 of the Security Agreement; or the Company
shall default in the performance of any of its other obligations in this
Agreement or any other Basic Document and such default shall continue unremedied
for a period of thirty days after notice thereof to the Company by the
Administrative Agent or any
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Lender (through the Administrative Agent); or In-Flight shall default in the
performance of any of its obligations under Section 6.02 of the In-Flight
Guarantee and Security Agreement; or
(e) The Company or any of its Subsidiaries shall admit in writing
its inability to, or be generally unable to, pay its debts as such debts become
due; or
(f) The Company or any of its Subsidiaries shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee, examiner or liquidator of itself or of all or a substantial
part of its Property, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the Bankruptcy Code, (iv) file
a petition seeking to take advantage of any other law relating to bankruptcy,
insolvency, reorganization, liquidation, dissolution, arrangement or winding-up,
or composition or readjustment of debts, (v) fail to controvert in a timely and
appropriate manner, or acquiesce in writing to, any petition filed against it in
an involuntary case under the Bankruptcy Code or (vi) take any corporate action
for the purpose of effecting any of the foregoing; or
(g) A proceeding or case shall be commenced, without the
application or consent of the Company or any of its Subsidiaries, in any court
of competent jurisdiction, seeking (i) its reorganization, liquidation,
dissolution, arrangement or winding-up, or the composition or readjustment of
its debts, (ii) the appointment of a receiver, custodian, trustee, examiner,
liquidator or the like of the Company or such Subsidiary or of all or any
substantial part of its Property, or (iii) similar relief in respect of the
Company or such Subsidiary under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and such
proceeding or case shall continue undismissed, or an order, judgment or decree
approving or ordering any of the foregoing shall be entered and continue
unstayed and in effect, for a period of 60 or more days; or an order for relief
against the Company or such Subsidiary shall be entered in an involuntary case
under the Bankruptcy Code; or
(h) A final judgment or judgments for the payment of money in
excess of $5,000,000 in the aggregate (exclusive of judgment amounts fully
covered by insurance where the insurer has admitted liability in respect of such
judgment) or in excess of $20,000,000 in the aggregate (regardless of insurance
coverage) shall be rendered by one or more courts, administrative tribunals or
other bodies having jurisdiction against the Company or any of its Subsidiaries
and the same shall not be discharged (or provision shall not be made for such
discharge), or a stay of execution thereof shall not be procured, within 30 days
from the date of entry thereof and the Company or the relevant Subsidiary shall
not, within said period of 30 days, or such longer period during which execution
of the same shall have been stayed, appeal therefrom and cause the execution
thereof to be stayed during such appeal; or
(i) An event or condition specified in Section 8.01(f) hereof
shall occur or exist with respect to any Plan or Multiemployer Plan and, as a
result of such event or condition, together with all other such events or
conditions, the Company or any ERISA Affiliate shall incur or in the opinion of
the Majority Lenders shall be reasonably likely to incur a liability to a Plan,
a Multiemployer Plan or PBGC (or any combination of the foregoing) which would
constitute, in the determination of the Majority Lenders, a Material Adverse
Effect; or
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(j) A reasonable basis shall exist for the assertion against the
Company or any of its Subsidiaries of (or there shall have been asserted against
the Company or any of its Subsidiaries) claims or liabilities, whether accrued,
absolute or contingent, based on or arising from the generation, storage,
transport, handling or disposal of Hazardous Materials by the Company or any of
its Subsidiaries or Affiliates, or any predecessor in interest of the Company or
any of its Subsidiaries or Affiliates, or relating to any site or facility
owned, operated or leased by the Company or any of its Subsidiaries or
Affiliates, which claims or liabilities (insofar as they are payable by the
Company or any of its Subsidiaries but after deducting any portion thereof which
is reasonably expected to be paid by other creditworthy Persons jointly and
severally liable therefor), in the judgment of the Majority Lenders are
reasonably likely to be determined adversely to the Company or any of its
Subsidiaries, and the amount thereof is, singly or in the aggregate, reasonably
likely to have a Material Adverse Effect; or
(k) Any "person" or "group" (as such terms are defined in
Sections 13(d) and 14(d) of the Securities Exchange Act (other than Amin or
Xxxxxx Xxxxxx, their lineal descendants or trusts established by such Persons
for their respective lineal descendants)) is or becomes the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
person shall be deemed to have "beneficial ownership" of all shares that any
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of 30%
or more of the aggregate voting rights of the outstanding capital stock of the
Company (on a fully diluted basis); or during any consecutive 25-month period,
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
stockholders of the Company was approved by a vote of 66-2/3% of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the Board of Directors of the Company
then in office; or
(l) Except for expiration in accordance with its terms, any of
the Security Documents shall be terminated or shall cease to be in full force
and effect, for whatever reason;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (f) or (g) of this Section 9 with respect to the Company, the
Administrative Agent may, by notice to the Company, terminate the Commitments
and/or declare the principal amount then outstanding of, and the accrued
interest on, the Loans, the Reimbursement Obligations and all other amounts
payable by the Company hereunder and under the Notes (including, without
limitation, any amounts payable under Section 5.05 or 5.06 hereof) to be
forthwith due and payable (PROVIDED that (x) if so requested by the Majority
Series A Lenders, the Administrative Agent shall take such action with respect
to the Series A Commitments and/or the Series A Loans, Reimbursement Obligations
and such interest and other amounts to the extent owed to the Series A Lenders
and (y) if so requested by the Majority Series B Lenders, the Administrative
Agent shall take such action with respect to the Series B Commitments and the
Series B Loans and such interest and other amounts to the extent owed to the
Series B Lenders), whereupon such amounts shall be immediately due and payable
without presentment, demand, protest or other formalities
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of any kind, all of which are hereby expressly waived by the Company; and (2) in
the case of the occurrence of an Event of Default referred to in clause (f) or
(g) of this Section 9 with respect to the Company, the Commitments shall
automatically be terminated and the principal amount then outstanding of, and
the accrued interest on, the Loans, the Reimbursement Obligations and all other
amounts payable by the Company hereunder and under the Notes (including, without
limitation, any amounts payable under Section 5.05 or 5.06 hereof) shall
automatically become immediately due and payable without presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by the Company.
In addition, upon the occurrence and during the continuance of
any Event of Default (if the Administrative Agent has declared the principal
amount then outstanding of, and accrued interest on, the Series A Loans and all
other amounts payable by the Company hereunder and under the Notes to be due and
payable), the Company agrees that it shall, if requested by the Administrative
Agent or the Majority Series A Lenders through the Administrative Agent (and, in
the case of any Event of Default referred to in clause (f) or (g) of this
Section 9 with respect to the Company, forthwith, without any demand or the
taking of any other action by the Administrative Agent or such Lenders) provide
cover for the Letter of Credit Liabilities by paying to the Administrative Agent
immediately available funds in an amount equal to the then aggregate undrawn
face amount of all Letters of Credit, which funds shall be held by the
Administrative Agent in the Collateral Account as collateral security in the
first instance for the Letter of Credit Liabilities and be subject to withdrawal
only as therein provided.
Section 10. THE ADMINISTRATIVE AGENT.
10.01 APPOINTMENT, POWERS AND IMMUNITIES. Each Lender hereby
irrevocably appoints and authorizes the Administrative Agent to act as its agent
hereunder and under the other Basic Documents with such powers as are
specifically delegated to the Administrative Agent by the terms of this
Agreement and of the other Basic Documents, together with such other powers as
are reasonably incidental thereto. The Administrative Agent (which term as used
in this sentence and in Section 10.05 and the first sentence of Section 10.06
hereof shall include reference to its affiliates and its own and its affiliates'
officers, directors, employees and agents): (a) shall have no duties or
responsibilities except those expressly set forth in this Agreement and in the
other Basic Documents, and shall not by reason of this Agreement or any other
Basic Document be a trustee for any Lender; (b) shall not be responsible to the
Lenders for any recitals, statements, representations or warranties contained in
this Agreement or in any other Basic Document, or in any certificate or other
document referred to or provided for in, or received by any of them under, this
Agreement or any other Basic Document, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement, any
Note or any other Basic Document or any other document referred to or provided
for herein or therein or for any failure by the Company or any other Person to
perform any of its obligations hereunder or thereunder; (c) shall not be
required to initiate or conduct any litigation or collection proceedings
hereunder or under any other Basic Document; and (d) shall not be responsible
for any action taken or omitted to be taken by it hereunder or under any other
Basic Document or under any other document or instrument referred to or provided
for herein or therein or in
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connection herewith or therewith, except for its own gross negligence or willful
misconduct. The Administrative Agent may deem and treat the payee of any Note as
the holder thereof for all purposes hereof unless and until a notice of the
assignment or transfer thereof shall have been filed with the Administrative
Agent, together with the consent of the Company to such assignment or transfer
(to the extent provided in Section 11.06(b) hereof).
10.02 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent
shall be entitled to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone, telecopy, telex,
telegram or cable) believed by it to be genuine and correct and to have been
signed or sent by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel, independent accountants and other experts
selected by the Administrative Agent. As to any matters not expressly provided
for by this Agreement or any other Basic Document, the Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by the Majority
Lenders or, if provided herein, in accordance with the instructions given by the
Majority Series A Lenders, the Majority Series B Lenders or all of the Lenders
as is required in such circumstance, and such instructions of such Lenders and
any action taken or failure to act pursuant thereto shall be binding on all of
the Lenders.
10.03 DEFAULTS. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of a Default unless the
Administrative Agent has received notice from a Lender or the Company specifying
such Default and stating that such notice is a "Notice of Default". In the event
that the Administrative Agent receives such a notice of the occurrence of a
Default, the Administrative Agent shall give prompt notice thereof to the
Lenders. The Administrative Agent shall (subject to Section 10.07 hereof) take
such action with respect to such Default as shall be directed by the Majority
Lenders or, if provided herein, the Majority Series A Lenders or the Majority
Series B Lenders, PROVIDED that, unless and until the Administrative Agent shall
have received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as it shall deem advisable in the best interest of the Lenders
except to the extent that this Agreement expressly requires that such action be
taken, or not be taken, only with the consent or upon the authorization of the
Majority Lenders, the Majority Series A Lenders, the Majority Series B Lenders
or all of the Lenders.
10.04 RIGHTS AS A LENDER. With respect to its Commitments and the
Loans made by it, Chase (and any successor acting as Administrative Agent) in
its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Administrative Agent, and the term "Lender" or "Lenders" shall,
unless the context otherwise indicates, include the Administrative Agent in its
individual capacity. Chase (and any successor acting as Administrative Agent)
and its affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in and generally engage in any
kind of banking, trust or other business with the Company (and any of its
Subsidiaries or Affiliates) as if it were not acting as the Administrative
Agent, and Chase and its affiliates may accept fees and other consideration
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from the Company for services in connection with this Agreement or otherwise
without having to account for the same to the Lenders.
10.05 INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent (to the extent not reimbursed under Section 11.03 hereof,
but without limiting the obligations of the Company under said Section 11.03,
and including in any event any payments under any indemnity that the
Administrative Agent is required to issue to any bank referred to in Section
4.02 of the Security Agreement or Section 5.02 of the In-Flight Guarantee and
Security Agreement to which remittances in respect of Accounts, as defined
therein, are to be made) ratably in accordance with the aggregate principal
amount of the Loans and Reimbursement Obligations held by the Lenders (or, if no
Loans or Reimbursement Obligations are at the time outstanding, ratably in
accordance with their respective Commitments), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind and nature whatsoever that may be imposed
on, incurred by or asserted against the Administrative Agent (including by any
Lender) arising out of or by reason of any investigation in or in any way
relating to or arising out of this Agreement or any other Basic Document or any
other documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby (including, without limitation, the
costs and expenses that the Company is obligated to pay under Section 11.03
hereof, and including also any payments under any indemnity that the
Administrative Agent is required to issue to any bank referred to in Section
4.02 of the Security Agreement or Section 5.02 of the In-Flight Guarantee and
Security Agreement to which remittances in respect of Accounts, as defined
therein, are to be made, but excluding, unless a Default has occurred and is
continuing, normal administrative costs and expenses incident to the performance
of its agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or of any such other documents, PROVIDED that no Lender shall be liable
for any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the party to be indemnified.
10.06 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender agrees that it has, independently and without reliance on the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Company and its Subsidiaries and decision to enter into this Agreement and that
it will, independently and without reliance upon the Administrative Agent or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement. The Administrative Agent shall
not be required to keep itself informed as to the performance or observance by
the Company of this Agreement or any of the other Basic Documents or any other
document referred to or provided for herein or therein or to inspect the
Properties or books of the Company or any of its Subsidiaries. Except for
notices, reports and other documents and information expressly required to be
furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the affairs, financial
condition or business of the Company or any of its Subsidiaries (or any of their
affiliates) that may come into the possession of the Administrative Agent or any
of its affiliates.
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10.07 FAILURE TO ACT. Except for action expressly required of the
Administrative Agent hereunder and under the other Basic Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 10.05 hereof against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action.
10.08 RESIGNATION OR REMOVAL OF ADMINISTRATIVE AGENT. Subject to
the appointment and acceptance of a successor Administrative Agent as provided
below, the Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Company, and the Administrative Agent may be removed at
any time with or without cause by the Majority Lenders. Upon any such
resignation or removal, the Majority Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Majority Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent's giving of
notice of resignation or the Majority Lenders' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Lenders, after consultations with the Company, appoint a successor
Administrative Agent, that shall be a bank which has an office in New York, New
York with a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent, the provisions of this Section 10 shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Administrative Agent.
10.09 CONSENTS UNDER BASIC DOCUMENTS. Except as otherwise
provided in Section 11.04 hereof with respect to this Agreement, the
Administrative Agent may, with the prior consent of the Majority Lenders (but
not otherwise), consent to any modification, supplement or waiver under any of
the Basic Documents, PROVIDED that, without the consent of each Lender, the
Administrative Agent shall not (except as provided herein or in the Security
Documents) release any collateral or otherwise terminate any Lien under the
Security Agreement, or agree to additional obligations being secured by such
collateral security (unless the Lien for such additional obligations shall be
junior to the Lien in favor of the other obligations secured by such Security
Documents), except that no such consent shall be required, and the
Administrative Agent is hereby authorized, to release any Lien covering Property
which (a) is the subject of a Disposition of Property permitted hereunder or to
which the Majority Lenders have consented, (b) consists of the membership
interests in In-Flight to which release the Majority Lenders have consented or
(c) consists of shares of any Subsidiary of the Company that is no longer a
Material Subsidiary.
10.10 COLLATERAL SUB-AGENTS. Each Lender by its execution and
delivery of this Agreement agrees, as contemplated by Section 4.03 of the
Security Agreement and Section 5.02 of the In-Flight Guarantee and Security
Agreement, that, in the event it shall hold any Permitted
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Investments referred to therein, such Permitted Investments shall be held in the
name and under the control of such Lender, and such Lender shall hold such
Permitted Investments as a collateral sub-agent for the Administrative Agent
thereunder. The Company by its execution and delivery of this Agreement hereby
consents to the foregoing.
10.11 DOCUMENTATION AGENT. The Documentation Agent identified on
the front cover page of this Agreement shall have no duties or responsibilities
hereunder other than as a Bank hereunder.
Section 11. MISCELLANEOUS.
11.01 WAIVER. No failure on the part of the Administrative Agent
or any Lender to exercise and no delay in exercising, and no course of dealing
with respect to, any right, power or privilege under this Agreement or any Note
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege under this Agreement or any Note preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The remedies provided herein are cumulative and not exclusive of any
remedies provided by law.
11.02 NOTICES. All notices, requests and other communications
provided for herein and under the Security Documents (including, without
limitation, any modifications of, or waivers or consents under, this Agreement)
shall be given or made in writing (including, without limitation, by telecopy)
delivered to the intended recipient at (i) in the case of the Company and the
Administrative Agent, the "Address for Notices" specified below its name on the
signature pages hereof) and (ii) in the case of each of the Lenders, the address
(or telecopy number) set forth in its Administrative Questionnaire; or, as to
any party, at such other address as shall be designated by such party in a
notice to each other party. Except as otherwise provided in this Agreement, all
such communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
11.03 EXPENSES, ETC. The Company agrees to pay or reimburse each
of the Lenders and the Administrative Agent for paying: (a) all reasonable
out-of-pocket costs and expenses of the Administrative Agent (including, without
limitation, the reasonable fees and expenses of Milbank, Tweed, Xxxxxx & XxXxxx,
special New York counsel to Chase), in connection with (i) the negotiation,
preparation, execution and delivery of this Agreement and the other Basic
Documents and the extension of credit hereunder and (ii) any modification,
supplement or waiver of any of the terms of this Agreement or any of the other
Basic Documents; (b) all reasonable costs and expenses of the Lenders and the
Administrative Agent (including, without limitation, reasonable counsels' fees)
in connection with (i) any Default and any enforcement or collection proceedings
resulting therefrom or in connection with the negotiation of any restructuring
or "work-out" (whether or not consummated), or the obligations of the Company
hereunder and (ii) the enforcement of this Section 11.03; and (c) all transfer,
stamp, documentary, intangibles or other similar taxes, assessments or charges
levied by any
CREDIT AGREEMENT
76
-71-
governmental or revenue authority in respect of this Agreement or any of the
other Basic Documents or any other document referred to herein or therein and
all costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated by any Basic Document or any other document referred to therein.
The Company hereby agrees (i) to indemnify the Administrative
Agent and each Lender and their respective directors, officers, employees,
attorneys and agents from, and hold each of them harmless against, any and all
losses, liabilities, claims, damages or expenses incurred by any of them
(including, without limitation, any and all losses, liabilities, claims, damages
or expenses incurred by the Administrative Agent to any Lender, whether or not
the Administrative Agent or any Lender is a party thereto) arising out of or by
reason of any investigation or litigation or other proceedings (including any
threatened investigation or litigation or other proceedings) relating to the
extensions of credit hereunder or any actual or proposed use by the Company or
any of its Subsidiaries of the proceeds of any of the extensions of credit
hereunder, including, without limitation, the reasonable fees and disbursements
of counsel incurred in connection with any such investigation or litigation or
other proceedings (but excluding any such losses, liabilities, claims, damages
or expenses incurred by reason of the gross negligence or willful misconduct of
the Person to be indemnified) and (ii) not to assert any claim against the
Administrative Agent, any Lender, any of their affiliates, or any of their
respective directors, officers, employees, attorneys and agents, on any theory
of liability, for special, indirect, consequential or punitive damages arising
out of or otherwise relating to any of the transactions contemplated herein or
in any other Basic Document. Without limiting the generality of the foregoing,
the Company will (x) indemnify the Administrative Agent for any payments that
the Administrative Agent is required to make under any indemnity issued to any
bank referred to in Section 4.02 of the Security Agreement or Section 5.02 of
the In-Flight Guarantee and Security Agreement to which remittances in respect
to Accounts, as defined therein, are to be made and (y) indemnify the
Administrative Agent and each Lender from, and hold the Administrative Agent and
each Lender harmless against, any losses, liabilities, claims, damages or
expenses described in the preceding sentence (but excluding, as provided in the
preceding sentence, any loss, liability, claim, damage or expense incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified) arising under any Environmental Law as a result of the past,
present or future operations of the Company or any of its Subsidiaries (or any
predecessor in interest to the Company or any of its Subsidiaries), or the past,
present or future condition of any site or facility owned, operated or leased by
the Company or any of its Subsidiaries (or any such predecessor in interest), or
any Release or threatened Release of any Hazardous Materials from any such site
or facility, including any such Release or threatened Release which shall occur
during any period when the Administrative Agent or any Lender shall be in
possession of any such site or facility following the exercise by the
Administrative Agent or any Lender of any of its rights and remedies hereunder
or under any of the Security Documents but only to the extent that such Release
or threatened Release is directly or indirectly attributable to facts,
circumstances or Releases of Hazardous Materials existing prior to the date of
such possession.
CREDIT AGREEMENT
77
-72-
11.04 AMENDMENTS, ETC. Except as otherwise expressly provided in
this Agreement, any provision of this Agreement may be modified or supplemented
only by an instrument in writing signed by the Company, the Administrative Agent
and the Majority Lenders, or by the Company and the Administrative Agent acting
with the consent of the Majority Lenders, and any provision of this Agreement
may be waived by the Majority Lenders or by the Administrative Agent acting with
the consent of the Majority Lenders; PROVIDED that: (a) no modification,
supplement or waiver shall, unless by an instrument signed by all of the Lenders
or by the Administrative Agent acting with the consent of all of the Lenders:
(i) increase, or extend the term of any of the Commitments, or extend the time
or waive any requirement for the reduction or termination of any of the
Commitments, (ii) extend the date fixed for the payment of principal of or
interest on any Loan, the Reimbursement Obligations or any fee hereunder, (iii)
reduce the amount of any such payment of principal, (iv) reduce the rate at
which interest is payable thereon or any fee is payable hereunder, (v) alter the
rights or obligations of the Company to prepay Loans, (vi) alter the terms of
this Section 11.04, (vii) modify the definition of the term "Majority Lenders",
"Majority Series A Lenders" or "Majority Series B Lenders", or modify in any
other manner the number or percentage of the Lender required to make any
determinations or waive any rights hereunder or to modify any provision hereof,
or (viii) waive any of the conditions precedent set forth in Section 6 hereof;
(b) any modification or supplement of Section 10 hereof shall require the
consent of the Administrative Agent; and (c) notwithstanding the above, (i)
Sections 2.01(a), 2.03, 2.04(a), 2.05(i) and 5.06, may be modified or
supplemented only by an instrument in writing signed by the Company, the
Administrative Agent and the Series A Lenders, or by the Company and the
Administrative Agent acting with the consent of the Series A Lenders, and any
such provision may be waived by the Series A Lenders or by the Administrative
Agent acting with the consent of the Series A Lenders, and (ii) Sections
2.01(b), 2.04(b) and 2.05(ii) may be modified or supplemented only by an
instrument in writing signed by the Company, the Administrative Agent and the
Series B Lenders, or by the Company and the Administrative Agent acting with the
consent of the Series B Lenders, and any such provision may be waived by the
Series B Lenders or by the Administrative Agent acting with the consent of the
Series B Lenders.
11.05 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
11.06 ASSIGNMENTS AND PARTICIPATIONS.
(a) The Company may not assign any of its rights or obligations
hereunder or under the Notes without the prior consent of all of the Lenders and
the Administrative Agent.
(b) Each Lender may assign any of its Loans, its Notes, its
Commitments, and, if such Lender is a Series A Lender, its Letter of Credit
Interest (but only with the consent of the Company and the Administrative Agent
and, in the case of a Series A Commitment or a Letter of Credit Interest, the
Issuing Lender, which consents in the case of the Company and the Administrative
Agent shall not be unreasonably withheld or delayed); PROVIDED that (i) any such
consent by the Company shall not be unreasonably withheld, (ii) no such consent
by the Company or the Administrative Agent shall be required in the case of any
assignment to another
CREDIT AGREEMENT
78
-73-
Lender; (iii) any such partial assignment shall be in an amount at least equal
to $5,000,000; (iv) unless the Company and the Administrative Agent shall
otherwise consent (which consents shall not be unreasonably withheld or
delayed), each such assignment by a Lender of its Series A Loans, Series A Note,
Series A Commitment or Letter of Credit Interest shall be made in such manner so
that the same percentage of its Series A Loans, Series A Note, Series A
Commitment and Letter of Credit Interest, Series B Loans, Series B Note and
Series B Commitment is assigned to the respective assignee; and (v) unless the
Company and the Administrative Agent shall otherwise consent (which consents
shall not be unreasonably withheld or delayed), each such assignment by a Lender
of its Series B Loans, Series B Note or Series B Commitment shall be made in
such manner so that the same percentage of its Series B Loans, Series B Note and
Series B Commitment, Series A Loans, Series A Note, Series A Commitment and
Letter of Credit Interest is assigned to the respective assignee. Upon execution
and delivery by the assignee to the Company, the Administrative Agent and the
Issuing Lender of an instrument in writing pursuant to which such assignee
agrees to become a "Lender" hereunder (if not already a Lender) having the
Commitment(s), Loans, and, if applicable, Letter of Credit Interest specified in
such instrument, and upon consent thereto by the Company, the Administrative
Agent and the Issuing Lender, to the extent required above, the assignee shall
have, to the extent of such assignment (unless otherwise provided in such
assignment with the consent of the Company, the Administrative Agent and the
Issuing Lender), the obligations, rights and benefits of a Lender hereunder
holding the Commitment(s), Loans and, if applicable, Letter of Credit Interest
(or portions thereof) assigned to it (in addition to the Commitment(s), Loans
and Letter of Credit Interest, if any, theretofore held by such assignee) and
the assigning Lender shall, to the extent of such assignment, be released from
the Commitment(s) (or portion(s) thereof) so assigned. Upon each such assignment
the assigning Lender shall pay the Administrative Agent an assignment fee of
$3,000.
(c) A Lender may sell or agree to sell to one or more other
Persons a participation in all or any part of any Loans or Letter of Credit
Interest held by it, or in its Commitments, in which event each purchaser of a
participation (a "PARTICIPANT") shall be entitled to the rights and benefits of
the provisions of Section 8.01(j) hereof with respect to its participation in
such Loans, Letter of Credit Interest and Commitments as if (and the Company
shall be directly obligated to such Participant under such provisions as if)
such Participant were a "Lender" for purposes of said Section, but, except as
otherwise provided in Section 4.07(c) hereof, shall not have any other rights or
benefits under this Agreement or any Note or any other Basic Document (the
Participant's rights against such Lender in respect of such participation to be
those set forth in the agreements executed by such Lender in favor of the
Participant). All amounts payable by the Company to any Lender under Section 5
hereof in respect of Loans, Letter of Credit Interest held by it, and its
Commitments, shall be determined as if such Lender had not sold or agreed to
sell any participations in such Loans, Letter of Credit Interest and
Commitments, and as if such Lender were funding each of such Loan, Letter of
Credit Interest and Commitments in the same way that it is funding the portion
of such Loan, Letter of Credit Interest and Commitments in which no
participations have been sold. In no event shall a Lender that sells a
participation agree with the Participant to take or refrain from taking any
action hereunder or under any other Basic Document except that such Lender may
agree with the Participant that it will not, without the consent of the
Participant, agree to (i) increase or extend the term, or extend the time or
waive
CREDIT AGREEMENT
79
-74-
any requirement for the reduction or termination, of such Lender's related
Commitment, (ii) extend the date fixed for the payment of principal of or
interest on the related Loan or Loans, Reimbursement Obligations or any portion
of any fee hereunder payable to the Participant, (iii) reduce the amount of any
such payment of principal, (iv) reduce the rate at which interest is payable
thereon, or any fee hereunder payable to the Participant, to a level below the
rate at which the Participant is entitled to receive such interest or fee, (v)
alter the rights or obligations of the Company to prepay the related Loans or
(vi) consent to any modification, supplement or waiver hereof or of any of the
other Basic Documents to the extent that the same, under Section 10.10 or 11.04
hereof, requires the consent of each Lender.
(d) In addition to the assignments and participations permitted
under the foregoing provisions of this Section 11.06, any Lender may assign and
pledge all or any portion of its Loans and its Notes to any Federal Reserve Bank
as collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank. No such assignment shall release the
assigning Lender from its obligations hereunder.
(e) A Lender may furnish any information concerning the Company
or any of its Subsidiaries in the possession of such Lender from time to time to
assignees and participants (including prospective assignees and participants),
subject, however, to the provisions of Section 11.12(b) hereof.
(f) Anything in this Section 11.06 to the contrary
notwithstanding, no Lender may assign or participate any interest in any Loan or
Reimbursement Obligation held by it hereunder to the Company or any of its
Affiliates or Subsidiaries without the prior written consent of each Lender.
11.07 SURVIVAL. The obligations of the Company under Sections
5.01, 5.05, 5.06, 5.07 and 11.03 hereof and the obligations of the Lenders under
Sections 10.05 and 11.12 hereof shall survive the repayment of the Loans and
Reimbursement Obligations and the termination of the Commitments. In addition,
each representation and warranty made, or deemed to be made by a notice of any
extension of credit (whether by means of a Loan or a Letter of Credit), herein
or pursuant hereto shall survive the making of such representation and warranty,
and no Lender shall be deemed to have waived, by reason of making any extension
of credit hereunder (whether by means of a Loan or a Letter of Credit), any
Default which may arise by reason of such representation or warranty proving to
have been false or misleading, notwithstanding that such Lender or the
Administrative Agent may have had notice or knowledge or reason to believe that
such representation or warranty was false or misleading at the time such
extension of credit was made.
11.08 CAPTIONS. The table of contents and captions and section
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
CREDIT AGREEMENT
80
-75-
11.09 COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
11.10 GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement
and the Notes shall be governed by, and construed in accordance with, the law of
the State of New York. The Company hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of the Supreme Court of the State of New York sitting in New York
County (including its Appellate Division), and any other appellate court in the
State of New York, for the purposes of all legal proceedings arising out of or
relating to this Agreement or the transactions contemplated hereby. The Company
irrevocably waives, to the fullest extent permitted by applicable law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
11.11 WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.12 TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY.
(a) The Company acknowledges that from time to time financial
advisory, investment banking and other services may be offered or provided to
the Company or one or more of its Subsidiaries (in connection with this
Agreement or otherwise) by any Lender or by one or more subsidiaries or
affiliates of such Lender and the Company hereby authorizes each Lender to share
any information delivered to such Lender by the Company and its Subsidiaries
pursuant to this Agreement, or in connection with the decision of such Lender to
enter into this Agreement, to any such subsidiary or affiliate, it being
understood that any such subsidiary or affiliate receiving such information
shall be bound by the provisions of clause (b) below as if it were a Lender
hereunder.
(b) Each Lender and the Administrative Agent agrees (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of this nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Company pursuant to this Agreement
which is identified by the Company as being confidential at the time the same is
delivered to the Lenders or the Administrative Agent, PROVIDED that nothing
herein shall limit the disclosure of any such information (i) to the extent
required by statute, rule, regulation or judicial process, (ii) to counsel for
any of the Lenders or the Administrative Agent, (iii) to bank examiners,
auditors or accountants, (iv) to the Administrative Agent or any other Lender
(or to Chase Securities Inc.), (v) in connection with any litigation to which
any one or more of the Lenders or the
CREDIT AGREEMENT
81
-76-
Administrative Agent is a party, (vi) to a subsidiary or affiliate of such
Lender as provided in clause (a) above or (vii) to any assignee or participant
(or prospective assignee or participant) so long as such assignee or participant
(or prospective assignee or participant) first executes and delivers to the
respective Lender a Confidentiality Agreement substantially in the form of
Exhibit B hereto; PROVIDED, FURTHER, that (x) unless specifically prohibited by
applicable law or court order, each Lender and the Administrative Agent shall,
prior to disclosure thereof, notify the Company of any request for disclosure of
any such non-public information (A) by any governmental agency or representative
thereof (other than any such request in connection with an examination of the
financial condition of such Lender by such governmental agency) or (B) pursuant
to legal process and (y) in no event shall any Lender or the Administrative
Agent be obligated or required to return any materials furnished by the Company.
CREDIT AGREEMENT
82
-77-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered as of the day and year first above written.
BE AEROSPACE, INC.
By________________________________
Title:
Address for Notices:
BE Aerospace, Inc.
0000 Xxxxxxxxx Xxxxxx Xxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx,
Vice President and Treasurer
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx, Esq.
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
CREDIT AGREEMENT
83
-00-
XXXXXXX
XXX XXXXX XXXXXXXXX BANK
By________________________________
Title:
NATIONSBANK, N.A.
By________________________________
Title:
CREDIT LYONNAIS ATLANTA AGENCY
By________________________________
Title:
LASALLE BUSINESS CREDIT, INC.
By________________________________
Title:
CREDIT AGREEMENT
84
-79-
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By________________________________
Title:
THE FUJI BANK AND TRUST COMPANY
By________________________________
Title:
WACHOVIA BANK, N.A.
By________________________________
Title:
AMSOUTH BANK
By________________________________
Title:
THE BANK OF NEW YORK
By________________________________
Title:
CREDIT AGREEMENT
00
-00-
XX XXXX XXXXXXXX XXXXXXXXXXXXXXXXXXX,
XXXXXX XXXXXX BRANCH
By________________________________
Title:
By________________________________
Title:
FIRST UNION NATIONAL BANK
By________________________________
Title:
SUNTRUST BANK, SOUTH FLORIDA, N.A.
By________________________________
Title:
ABN AMRO BANK N.V.
By________________________________
Title:
By________________________________
Title:
CREDIT AGREEMENT
86
-00-
XXX XXXXX XXXXXXXXX BANK,
as Administrative Agent
By________________________________
Title:
Address for Notices to
Chase as Administrative Agent:
The Chase Manhattan Bank
Loan and Agency Services Group
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
CREDIT AGREEMENT
87
Annex 1
Series A Series B Total
Bank Commitment Commitment Commitments
---- ------------ ------------ ------------
The Chase Manhattan Bank $ 11,000,000 $ 11,000,000 $ 22,000,000
NationsBank, N.A $ 10,000,000 $ 10,000,000 $ 20,000,000
Credit Lyonnais Atlanta Agency $ 9,500,000 $ 9,500,000 $ 19,000,000
LaSalle Business Credit, Inc. $ 9,500,000 $ 9,500,000 $ 19,000,000
The Long-Term Credit Bank $ 9,500,000 $ 9,500,000 $ 19,000,000
of Japan, Ltd.
The Fuji Bank and Trust Company $ 9,500,000 $ 9,500,000 $ 19,000,000
Wachovia Bank, N.A $ 9,500,000 $ 9,500,000 $ 19,000,000
Amsouth Bank $ 6,000,000 $ 6,000,000 $ 12,000,000
The Bank of New York $ 6,000,000 $ 6,000,000 $ 12,000,000
DG Bank Deutsche Genossenschaftsbank $ 6,000,000 $ 6,000,000 $ 12,000,000
Cayman Island Branch
First Union National Bank $ 6,000,000 $ 6,000,000 $ 12,000,000
SunTrust Bank, South Florida, N.A $ 6,000,000 $ 6,000,000 $ 12,000,000
ABN Amro Bank N.V $ 1,500,000 $ 1,500,000 $ 3,000,000
Total $100,000,000 $100,000,000 $200,000,000
ANNEX 1 TO CREDIT AGREEMENT
88
SCHEDULE I
MATERIAL AGREEMENTS AND LIENS
[SEE SECTIONS 7.12 AND 8.07(b)]
Part A - MATERIAL AGREEMENTS
1. [Intentionally Omitted]
2. Loan agreements dated February 24, 1993 between the Company's subsidiary
Flight Equipment and Engineering Limited, an English corporation
("FEEL"), and Barclays Bank PLC ("BARCLAYS"), as amended, providing for
an overdraft facility in the aggregate principal amount of
(pound)3,000,000.
3. Guarantee dated February 24, 1993 by the Company to Barclays limited to
(pound)2,750,000 of the Indebtedness of FEEL described in Item 2 above.
4. Guarantee as of March 1, 1993 of Aircraft Furnishing Limited ("AFL") in
an unlimited amount of the Indebtedness of FEEL described in described
in Item 2 above.
5. Loan agreement between Royal Inventum B.V. and ING Bank dated July 14,
1993 in the aggregate principal amount of Dfl. 2,000,000.
6. Demand Promissory Note dated August 27, 1993 from Aero Holdings
Acquisition Corp. (now known as Acurex Corporation) to the Company in
the aggregate principal amount of approximately $2,000,000.
7. Acquisition Agreement among the Company, Xxxxxx X. Xxxxxxxx and Xxxxxxxx
Industries, Inc. dated July 27, 1993. (Acquisition purchase price
adjustments unknown)
8. Purchase Agreement dated October 26, 1993 between the Company and Xxxxxx
X. XxXxxxxxx and Xxxxx X. XxXxxxxxx, Trustees of the Xxxxxx X. and Xxxxx
X. XxXxxxxxx Living Trust, Dated August 3, 1990 pursuant to which the
trust sold certain residential property located in San Clemente,
California to the Company, and the Company, among other things, assumed
Indebtedness which, as of the date hereof, is outstanding to Countrywide
Funding Corporation in the aggregate principal amount of $457,484.
9. Capitalized lease obligations of FEEL and AFL for machinery and
equipment in the aggregate amount of $945,000.
10. Indebtedness of FEEL to the Company in an aggregate principal amount not
in excess of (pound)3,369,541.
11. Indebtedness of BE Aerospace (Netherlands) B.V. to the Company in an
aggregate principal amount not in excess of Dfls. 49,385,000.
SCHEDULE I TO CREDIT AGREEMENT
89
-2-
12. Indenture dated as of January 24, 1996 between the Company and First
National Bank of Connecticut, as trustee, in connection with
$100,000,000 of 9-7/8% Senior Subordinated Notes due 2006.
13. Acquisition Agreement dated as of December 14, 1995, among the Company,
Xxxxx Aerospace Corporation, Eagle Industrial Products Corporation,
Eagle Industries, Inc. and Great American Management and Investment,
Inc. (Acquisition purchase price adjustment unknown.)
SCHEDULE I TO CREDIT AGREEMENT
90
-3-
Part B - LIENS
SCHEDULE I TO CREDIT AGREEMENT
91
SCHEDULE II
HAZARDOUS MATERIALS
[SEE SECTION 7.13]
SCHEDULE II TO CREDIT AGREEMENT
92
SCHEDULE III
SUBSIDIARIES AND INVESTMENTS
[SEE SECTIONS 7.17 AND 8.08(a)]
Part A - SUBSIDIARIES
Jurisdiction
of Percentage
Subsidiary Organization Owners Of Ownership
---------- ------------ ------ ------------
BE Aerospace Barbados BEA 100%
International, Ltd.
BE Aerospace (UK) England BEA 100%
Limited ("BEA-UK")
Flight Equipment and England BEA-UK 100%
Engineering Limited
BE Aerospace England BEA-UK 100%
(Services), Limited
Aircraft Furnishing England AFL 99.00%
Limited ("AFL") 1.00%
Fort Hill Aircraft Northern AFL 100%
Limited ("AFL") Ireland
AFI Holdings Northern AFL 100%
Limited Ireland
BE Aerospace France BEA 98.00%
(France) S.A.R.L. K.A.D. 1.00%
Companies, Inc. 1.00%
Xxxx Xxxxxxxx
(director)
BE Aerospace Delaware BEA 100%
(U.S.A.), Inc.
BE Aerospace Netherlands BEA 90%
(Netherlands) B.V. BEA (U.S.A.) 10%
("XXX-XXXX")
SCHEDULE III TO CREDIT AGREEMENT
00
-0-
Xxxxx Xxxxxxxx X.X. Xxxxxxxxxxx XXX-Xxxx 96.60%*
Tepaco Properties B.V. Netherlands XXX-Xxxx 100%
Acurex Corporation Delaware BEA 100%
Xxxxxxxx Industries, California BEA 100%
Inc.
--------------------
* The balance of these shares were lost prior to the sale of the shares of
this entity to BEA.
SCHEDULE III TO CREDIT AGREEMENT
94
-3-
Part B - INVESTMENTS
In addition to the Investments set forth in Part A above, as of
the date hereof the Company has the following outstanding Investments:
a. an Investment in a Middle East sales office in an amount not to
exceed $200,000;
b. an Investment in a residential property in San Clemente,
California in an amount of approximately $600,000; and
c. Money Market Funds in the amount, as of May 23, 1997, of
approximately $35M.
Finally, each of the matters described in Items 3, 5, 9 and 10 of
Part A of Schedule I constitutes an Investment in or by FEEL, AFL and the
Company, as the case may be.
SCHEDULE III TO CREDIT AGREEMENT
95
SCHEDULE IV
APPROVALS AND COMPLIANCE
None, except compliance with certain Environmental Laws disclosed
in the materials set forth in Schedule II hereto.
SCHEDULE IV TO CREDIT AGREEMENT
96
SCHEDULE V
EXISTING LETTERS OF CREDIT
Letter of Credit No. Amount Outstanding Expiry Date
-------------------- ------------------ -----------
Total Letters of Credit
Outstanding $
SCHEDULE V TO CREDIT AGREEMENT
97
SCHEDULE VI
TAXES
None.
SCHEDULE VI TO CREDIT AGREEMENT
98
SCHEDULE VII
TRANSACTIONS WITH AFFILIATES
Under a Supply Agreement dated April 17, 1990 with Applied
Extrusion Technologies, Inc., a Delaware corporation ("AET"), the Company
purchases from AET its requirements of injection-molded plastic parts for use in
the manufacture of passenger control units and other products for installation
in commercial aircraft for the period ending March 31, 1998. Under that
agreement, AET has agreed to use its best efforts at all times to maintain
available and in good working order a sufficient number and variety of injection
molding machines to satisfy the Company's orders as received and to use its best
efforts to initiate production within three days of receipt of an order or, in
emergency situations, on the date on which the order is received. The price to
be paid by the Company to AET for products purchased under the Supply Agreement
is an amount which results in a 33-1/3% gross margin to AET, after including in
AET's standard cost for such products, all direct and indirect costs of labor,
materials, equipment and overhead. Purchases by the Company under this agreement
for the fiscal year ended on February 22, 1997 were approximately $1,642,000.
Xx. Xxxx X. Xxxxxx is a director and significant stockholder of AET and serves
as its Chairman and Chief Executive Officer. Messrs. Xxxxxxx X. Xxxxxxxxx and
Xxxxxxxxx Xxxx, directors of BE Aerospace, Inc.
are also directors of AET.
SCHEDULE VII TO CREDIT AGREEMENT
