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EXHIBIT 10.7
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CREDIT AGREEMENT
Dated as of August 26, 1997
among
XXXXXXX INDUSTRIES INC.
The LENDERS party hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
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CHASE SECURITIES INC.,
as Arranger
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TABLE OF CONTENTS
PAGE
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ARTICLE I
Definitions
SECTION 1.01. Defined Terms.......................................................................................1
SECTION 1.02. Classification of Loans and Borrowings..............................................................26
SECTION 1.03. Terms Generally.....................................................................................26
SECTION 1.04. Accounting Terms; GAAP..............................................................................27
ARTICLE II
The Credits
SECTION 2.01. Commitments.........................................................................................27
SECTION 2.02. Loans and Borrowings................................................................................27
SECTION 2.03. Requests for Borrowings.............................................................................28
SECTION 2.04. Letters of Credit...................................................................................29
SECTION 2.05. Funding of Borrowings...............................................................................33
SECTION 2.06. Interest Elections..................................................................................34
SECTION 2.07. Termination and Reduction of Commitments............................................................35
SECTION 2.08. Maturity of Loans; Evidence of Debt.................................................................36
SECTION 2.09. Mandatory Prepayment of Loans and Reduction of Revolving Commitments................................37
SECTION 2.10. Optional Prepayment of Loans........................................................................40
SECTION 2.11. Fees................................................................................................40
SECTION 2.12. Interest............................................................................................42
SECTION 2.13. Alternate Rate of Interest..........................................................................42
SECTION 2.14. Increased Costs.....................................................................................43
SECTION 2.15. Break Funding Payments..............................................................................44
SECTION 2.16. Taxes...............................................................................................45
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.........................................46
SECTION 2.18. Mitigation Obligations; Replacement of Lenders......................................................48
ARTICLE III
Representations and Warranties
SECTION 3.01. Organization; Powers................................................................................49
SECTION 3.02. Authorization; Enforceability.......................................................................49
SECTION 3.03. Governmental Approvals; No Conflicts................................................................49
SECTION 3.04. Financial Condition; No Material Adverse Change.....................................................49
SECTION 3.05. Properties..........................................................................................50
SECTION 3.06. Litigation and Environmental Matters................................................................51
SECTION 3.07. Compliance with Laws and Agreements.................................................................54
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SECTION 3.08. Investment and Holding Company Status...............................................................54
SECTION 3.09. Taxes...............................................................................................54
SECTION 3.10. ERISA...............................................................................................54
SECTION 3.11. Disclosure..........................................................................................55
SECTION 3.12. Guarantors..........................................................................................55
SECTION 3.13. Collateral Documents................................................................................55
SECTION 3.14. Acquisition Documents...............................................................................55
SECTION 3.15. Solvency............................................................................................55
ARTICLE IV
Conditions
SECTION 4.01. Effective Date......................................................................................56
SECTION 4.02. Term Drawdown Date..................................................................................59
SECTION 4.03. Each Credit Event...................................................................................62
ARTICLE V Affirmative Covenants
SECTION 5.01. Financial Statements and Other Information..........................................................63
SECTION 5.02. Notices of Material Events..........................................................................65
SECTION 5.03. Existence; Conduct of Business......................................................................66
SECTION 5.04. Payment of Obligations..............................................................................66
SECTION 5.05. Maintenance of Properties; Insurance................................................................66
SECTION 5.06. Books and Records; Inspection Rights................................................................66
SECTION 5.07. Compliance with Laws................................................................................67
SECTION 5.08. Use of Proceeds and Letters of Credit...............................................................67
SECTION 5.09. Further Assurances..................................................................................67
SECTION 5.10. Landlord and Warehouseman Waivers...................................................................68
SECTION 5.11. Post-Closing Title Matters..........................................................................68
ARTICLE VI
Negative Covenants
SECTION 6.01. Indebtedness........................................................................................69
SECTION 6.02. Liens...............................................................................................71
SECTION 6.03. Fundamental Changes; Asset Sales....................................................................73
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions...........................................73
SECTION 6.05. Hedging Agreements..................................................................................75
SECTION 6.06. Restricted Payments; Voluntary Prepayments..........................................................75
SECTION 6.07. Transactions with Affiliates........................................................................76
SECTION 6.08. Restrictive Agreements..............................................................................76
SECTION 6.09. Modification of Certain Documents...................................................................76
SECTION 6.10. Accounting Changes..................................................................................77
SECTION 6.11. Capital Expenditures and Permitted Acquisitions.....................................................77
SECTION 6.12. Leverage Ratio......................................................................................78
SECTION 6.13. Minimum Consolidated Net Worth......................................................................78
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SECTION 6.14. Interest Coverage Ratio.............................................................................78
ARTICLE VII
Events of Default
ARTICLE VIII
The Administrative Agent
SECTION 8.01. Appointment, Powers and Immunities..................................................................82
SECTION 8.02. Reliance by Administrative Agent....................................................................83
SECTION 8.03. Appointment of Sub-Agents...........................................................................83
SECTION 8.04. Successor Administrative Agents.....................................................................83
SECTION 8.05. Non-Reliance on Administrative Agent and Other Lenders..............................................84
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices.............................................................................................84
SECTION 9.02. Waivers; Amendments.................................................................................85
SECTION 9.03. Expenses; Indemnity; Damage Waiver..................................................................86
SECTION 9.04. Successors and Assigns..............................................................................88
SECTION 9.05. Survival............................................................................................90
SECTION 9.06. Counterparts; Integration...........................................................................91
SECTION 9.07. Severability........................................................................................91
SECTION 9.08. Right of Setoff.....................................................................................91
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process..........................................91
SECTION 9.10. WAIVER OF JURY TRIAL................................................................................92
SECTION 9.11. Headings............................................................................................92
SECTION 9.12. Confidentiality.....................................................................................92
SECTION 9.13. Interest Rate Limitation............................................................................93
SCHEDULES:
Schedule 1.01 -- Mortgages
Schedule 2.01 -- Commitments
Schedule 2.09 -- Assets Held for Disposition
Schedule 3.03 -- Potential Indenture Defaults
Schedule 3.06 -- Environmental Matters
Schedule 4.01 -- Indebtedness to be Refinanced on the Effective Date; Mortgage
Title Insurance Amounts
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Existing Investments
Schedule 6.07 -- Existing Agreements Pursuant to Which Transactions with
Affiliates May Be Consummated
Schedule 6.08 -- Existing Restrictions
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EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Borrower Pledge Agreement
Exhibit C -- Form of Borrower Security Agreement
Exhibit D -- Form of Subsidiary Guarantee
Exhibit E -- Form of Subsidiary Pledge Agreement
Exhibit F -- Form of Subsidiary Security Agreement
Exhibit G -- Form of Opinion of Counsel for Obligors
Exhibit H -- Form of Opinion of Real Estate Counsel for the Obligors
Exhibit I -- Form of Opinion of Special Counsel for the Administrative
Agent
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CREDIT AGREEMENT dated as of August 26, 1997 among XXXXXXX INDUSTRIES
INC., the LENDERS party hereto, and THE CHASE MANHATTAN BANK, as Administrative
Agent.
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
"ACQUISITION" means the acquisition by the Borrower, through LII Europe,
of 50% of the common equity of JVC.
"ACQUISITION DOCUMENTS" means (i) the Shareholders Agreement dated as of
August 1, 1997 among Xxxxx-Xxxxxxx Chimie, JVC, LII Europe and the Borrower,
(ii) each other document executed and delivered at the closing of the
Acquisition, each as in effect on the Term Drawdown Date in the form approved by
the Lenders on or prior to the Term Drawdown Date and as further amended from
time to time in accordance with Section 6.09, (iii) the Stock Purchase
Agreement, and (iv) the Put/Call Agreement.
"ADJUSTED BORROWER EBITDA" means, (i) for any period ended on or prior to
the Term Drawdown Date or after the date on which JVC becomes a Subsidiary,
Borrower Consolidated EBITDA for such period and (ii) for any period ended after
the Term Drawdown Date and prior to the date on which JVC becomes a Subsidiary,
the sum of (1) Borrower Consolidated EBITDA for such period plus (2) Adjusted
JVC EBITDA for such period.
"ADJUSTED JVC EBITDA" means, for any period, (i) 50% of JVC Consolidated
EBITDA for such period minus (ii) 100% of cash distributions made by JVC to the
Borrower and its Consolidated Subsidiaries during such period minus (iii) 100%
of cash payments made by JVC to the Borrower or any Consolidated Subsidiary
which is a Subsidiary Guarantor of the principal of or interest on the
Intercompany Acquisition Loan.
"ADJUSTED LIBO RATE" means, with respect to any Eurocurrency Borrowing
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to (a) the applicable LIBO Rate for
such Interest Period multiplied by (b) the Statutory Reserve Rate.
"ADMINISTRATIVE AGENT" means The Chase Manhattan Bank, in its capacity as
administrative agent for the Lenders under the Loan Documents, and any successor
appointed pursuant to the provisions of Section 8.04.
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"ADMINISTRATIVE QUESTIONNAIRE" means an Administrative Questionnaire in a
form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to a specified Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"ALTERNATE BASE RATE" means, for any day, a rate per annum equal to the
greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.
"APPLICABLE LEVERAGE RATIO" means, for any day, the Leverage Ratio on the
last day of the most recently ended fiscal quarter of the Borrower for which the
Borrower has delivered to the Administrative Agent and the Lenders the financial
statements referred to in Section 3.04(a) or required to be delivered by the
Borrower pursuant to Sections 5.01(a) or 5.01(b), as the case may be; provided
that if the Borrower shall not have timely delivered any such financial
statements, and the Required Lenders shall not have agreed otherwise, the
Applicable Leverage Ratio for each day from and including the day on which such
financial statements are required to be delivered to but excluding the day on
which such financial statements are delivered shall be deemed to be greater than
3.50:1.
"APPLICABLE PERCENTAGE" means, with respect to any Lender with a
Commitment of either Class, the percentage of the total Commitments of such
Class represented by such Lender's Commitment of such Class. If the Commitments
of either Class have terminated or expired, the Applicable Percentages with
respect to the Commitments of such Class shall be determined based upon the
Commitments of such Class most recently in effect, giving effect to any
assignments.
"APPLICABLE RATE" means, for any day, with respect to any ABR Loan or
Eurocurrency Loan, or with respect to any letter of credit participation fee or
any commitment fee payable hereunder, as the case may be, the applicable rate
per annum set forth below under the caption "ABR SPREAD", "EUROCURRENCY SPREAD",
"LETTER OF CREDIT FEE RATE" or "COMMITMENT FEE RATE", as the case may be, based
upon the Applicable Leverage Ratio on such day:
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Letter of
Applicable Leverage Ratio: ABR Eurocurrency Credit Commitment
Spread Spread Fee Rate Fee Rate
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0% 1.00% 0.75% .250%
<2.00 to 1
-
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0% 1.25% 1.00% .3125%
>2.00 to 1 and < 2.50 to 1
-
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.25% 1.50% 1.25% .375%
>2.50 to 1 and < 3.00 to 1
-
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.50% 1.75% 1.50% .4375%
>3.00 to 1 and < 3.50 to 1
-
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.75% 2.00% 1.75% .500%
>3.50 to 1
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"ASSET SALE" means any sale, lease, license or other disposition
(including any such transaction effected by way of merger or consolidation) by
the Borrower or any of its Subsidiaries of any asset, including without
limitation any sale-leaseback transaction, whether or not involving a capital
lease, or any sale of the stock of any Subsidiary, but excluding (i)
dispositions of cash, cash equivalents and other cash management investments and
obsolete, unused or unnecessary equipment, in each case in the ordinary course
of business, (ii) dispositions of inventory in the ordinary course of business
and (iii) dispositions to the Borrower or any Subsidiary Guarantor. The
description of any transaction as not constituting an "Asset Sale" does not
affect any limitation on such transaction imposed by Articles V and VI of this
Agreement.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.
"AVAILABILITY PERIOD" means the period from and including the Effective
Date to but excluding the earlier of (i) the Maturity Date and (ii) the date of
termination of the Revolving Commitments.
"BOARD" means the Board of Governors of the Federal Reserve System of the
United States of America.
"BORROWER" means XxXxxxx Industries Inc., a Delaware corporation, and its
successors.
"BORROWER CONSOLIDATED EBITDA" means, for any period, the sum of:
(1) consolidated net income of the Borrower and its
Consolidated Subsidiaries for such period (exclusive of (x) the
portion of net income allocable to minority interests in
unconsolidated Persons to the extent that cash distributions have
not actually been received from such Persons and (y) the effect of
any extraordinary or non recurring gain or loss), plus
(2) to the extent deducted in determining such consolidated
net income, the aggregate amount of (i) Consolidated Interest
Expense, (ii) income tax expense and
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(iii) depreciation and amortization (including without limitation
amortization of debt issuance costs) and other similar non-cash
charges, plus
(3) to the extent not otherwise included in Borrower
Consolidated EBITDA, cash repayments received by the Borrower or
any Consolidated Subsidiary which is a Subsidiary Guarantor of the
principal amount of the Intercompany Acquisition Loan.
"BORROWER PLEDGE AGREEMENT" means the pledge agreement substantially in
the form of Exhibit B between the Borrower and the Administrative Agent as
amended from time to time.
"BORROWER SECURITY AGREEMENT" means the security agreement substantially
in the form of Exhibit C between the Borrower and the Administrative Agent
entered into as of the Effective Date, as amended from time to time.
"BORROWING" means Loans of the same Type made, converted or continued on
the same date and, in the case of Eurocurrency Loans, as to which a single
Interest Period is in effect.
"BORROWING REQUEST" means a request by the Borrower for a Borrowing in
accordance with Section 2.03.
"BUSINESS" means substantially all of the assets of the French
chlor-alkali business unit of Xxxxx-Xxxxxxx Chimie located at Pont de Claix,
Hauterives and Saint Fons.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or other day
on which commercial banks in New York City are authorized or required by law to
remain closed; provided that (i) when used in connection with a Eurodollar Loan,
the term "BUSINESS DAY" shall also exclude any day on which banks are not open
for dealings in Dollar deposits in the London interbank market and (ii) when
used in connection with a French Franc Loan, the term "BUSINESS DAY" shall also
exclude any day on which banks are not open for dealings in deposits in French
Francs in London and, if funds are to be paid or made available in Paris on such
day, Paris.
"CAPITAL LEASE OBLIGATIONS" of any Person means the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, and any rules or regulations promulgated
thereunder.
"CHANGE IN CONTROL" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof), other than
Permitted Holders, of shares representing more than 25% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
the Borrower; (b) occupation of a majority of the seats (other than vacant
seats) on the board of
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directors of the Borrower by Persons who were neither (i) nominated by the board
of directors of the Borrower nor (ii) appointed by directors so nominated; (c)
the acquisition of direct or indirect Control of the Borrower by any Person or
group other than Permitted Holders or (d) the failure of the Permitted Holders,
collectively, to own (x) at any time prior to the consummation of a Qualified
IPO, at least 51% of the aggregate ordinary voting power represented by the
issued and outstanding capital stock of the Borrower and (y) at any time on or
after the consummation of a Qualified IPO, at least 30% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
the Borrower.
"CHANGE IN LAW" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.14(b), by any lending office of such Lender
or by such Lender's or the Issuing Bank's holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.
"CLASS", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Term Loans or
Revolving Loans.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
"COLLATERAL" means, collectively, all of the "Collateral" under the
Collateral Documents.
"COLLATERAL ACCOUNT" has the meaning assigned to such term in the
Borrower Security Agreement.
"COLLATERAL DOCUMENTS" means the Pledge Agreements, the Security
Agreements, the Mortgages, any additional pledge agreements, security agreements
or mortgages required to be delivered pursuant to the Loan Documents (including
without limitation pursuant to Section 5.09 of this Agreement) and any other
instruments or agreements executed pursuant to any of the foregoing.
"COMMITMENT" means a Term Commitment or a Revolving Commitment, and
"COMMITMENTS" means both of them.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the additions
to property, plant and equipment and other capital expenditures of the Borrower
and its Consolidated Subsidiaries for such period, as the same are or would be
set forth in a consolidated statement of cash flows of the Borrower and its
Consolidated Subsidiaries for such period, including in any event the capital
portion of lease payments made in respect of Capital Lease Obligations, but
excluding expenditures for the restoration or replacement of fixed assets to the
extent financed by the proceeds of an insurance policy described in clause (i)
of the definition of "MAJOR CASUALTY PROCEEDS."
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"CONSOLIDATED CURRENT ASSETS" means at any date the consolidated current
assets of the Borrower and its Consolidated Subsidiaries determined as of such
date.
"CONSOLIDATED CURRENT LIABILITIES" means at any date (i) the consolidated
current liabilities of the Borrower and its Consolidated Subsidiaries plus (ii)
the current liabilities of any Person (other than the Borrower or any of its
Consolidated Subsidiaries) which are Guaranteed by the Borrower or a
Consolidated Subsidiary, all determined as of such date.
"CONSOLIDATED INDEBTEDNESS" means, at any date, the Indebtedness of the
Borrower and its Consolidated Subsidiaries, but excluding (x) Employee Loan
Guarantees with respect to loans in an aggregate principal amount not to exceed
$5,000,000, (y) the Turbine Lease Guarantee and (z) solely at any date on and
after the Term Drawdown Date, the Regulatory Guarantees, determined on a
consolidated basis as of such date.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the interest
expense of the Borrower and its Consolidated Subsidiaries, determined on a
consolidated basis for such period, including in any event the interest portion
of payments under Capital Lease Obligations, but excluding (i) any amortization
of debt issuance costs and (ii) to the extent included in interest expense in
accordance with Financial Accounting Standards Board Statements Nos. 87 and 106,
deferred payment obligations with respect to pension plans and post retirement
benefits.
"CONSOLIDATED NET WORKING INVESTMENT" means at any date Consolidated
Current Assets (exclusive of cash and cash equivalents) minus Consolidated
Current Liabilities (exclusive of Indebtedness).
"CONSOLIDATED NET WORTH" means, at any date, the consolidated
stockholders' equity of the Borrower and its Consolidated Subsidiaries
determined as of such date.
"CONSOLIDATED SUBSIDIARY" means, at any date, any Subsidiary or other
entity the accounts of which would be consolidated with those of the Borrower in
its consolidated financial statements if such statements were prepared as of
such date.
"CONTROL" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"CONTROLLING" and "CONTROLLED" have meanings correlative thereto.
"DEFAULT" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"DOLLAR" (i) or "$" means, when used in reference to a currency, lawful
money of the United States of America and (ii) when used in reference to any
Loan or Borrowing, refers to a Loan, or Loans comprising such Borrowing, bearing
interest at a rate determined by reference to the Adjusted LIBO Rate for
Borrowings in Dollars or the Alternate Base Rate.
"DOLLAR AMOUNT" means, at any time:
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(i) with respect to any Dollar Loan, the principal
amount thereof then outstanding;
(ii) with respect to any French Franc Loan, the principal
amount thereof then outstanding in French Francs, converted to
Dollars at the Spot Rate at the relevant Rate Fixing Time;
(iii) with respect to any Letter of Credit, the undrawn
amount thereof; and
(iv) with respect to any LC Disbursement, the amount of
such LC Disbursement.
As used in this definition, "SPOT RATE" means, at any Rate Fixing Time,
the spot rate at which French Francs are offered for sale against Dollars as
shown on Reuters page FX, WRLD at such Rate Fixing Time, and "RATE FIXING TIME"
means (i) if a Dollar Amount is being determined in connection with a Borrowing,
prepayment or other action requiring advance notice from the Borrower to the
Administrative Agent hereunder, a time determined by the Administrative Agent
within a reasonable time after it receives such notice and (ii) if a Dollar
Amount is being determined in any other connection, a time determined by the
Administrative Agent on the day on which the relevant action is to be taken or
for which the relevant amount is to be determined, as the case may be.
"DOLLAR PAYMENTS" has the meaning assigned such term in Section 2.17(a).
"EFFECTIVE DATE" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).
"EMPLOYEE LOAN GUARANTEES" means any Guarantee by the Borrower of loans
made to employees of the Borrower and its Subsidiaries to permit such employees
to purchase shares of capital stock of the Borrower; provided that such shares
are pledged to the Borrower as collateral security for such Guarantee.
"ENVIRONMENTAL LAWS" means any and all applicable federal, state, local
and foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, codes, plans, injunctions, permits, concessions,
grants, franchises, licenses, agreements and other governmental restrictions
relating to the environment or the effect of the environment on human health or
to emissions, discharges or release of pollutants, contaminants, Hazardous
Substances or wastes into the environment, including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
wastes or the clean-up or other remediation thereof.
"ENVIRONMENTAL LIABILITIES" means all liabilities in connection with or
relating to the business, assets, presently or previously owned or leased
property, activities (including, without limitation, off-site disposal) or
operations of the Borrower and each Subsidiary, whether vested or unvested,
contingent or fixed, actual or potential, known or unknown, which arise under or
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relate to matters covered by Environmental Laws (including, without limitation,
any matter disclosed or required to be disclosed in Schedule 3.06 hereto).
"EQUITY ISSUANCE" means the issuance of any equity securities by the
Borrower or any of its Subsidiaries, including without limitation any equity
securities issued pursuant to the exercise of stock options or warrants, other
than equity securities issued to the Borrower or any Subsidiary.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA EVENT" means (a) any "REPORTABLE EVENT", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "ACCUMULATED FUNDING DEFICIENCY" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"EUROCURRENCY", when used in reference to any Loan or Borrowing, refers
to a Loan, or Loans comprising such Borrowing, that are Eurodollar Loans or
French Franc Loans.
"EURODOLLAR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are made in Dollars
and bear interest at a rate determined by reference to the Adjusted LIBO Rate.
"EVENT OF DEFAULT" has the meaning assigned to such term in Article VII.
"EXCESS CASH FLOW" means, for any period, the excess (if any), determined
without duplication, of:
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the sum of (i) Borrower Consolidated EBITDA for such fiscal
period, (ii) cash interest income and extraordinary cash income of
the Borrower and its Consolidated Subsidiaries for such fiscal
period (to the extent not included in Borrower Consolidated
EBITDA) and (iii) any decrease in Consolidated Net Working
Investment between the beginning and the end of such period;
minus
the sum of (i) Consolidated Capital Expenditures made in
cash in accordance with Section 6.11 during such period, (ii) cash
interest expense and extraordinary cash expense of the Borrower
and its Consolidated Subsidiaries for such period (to the extent
not included in Borrower Consolidated EBITDA), (iii) any increase
in Consolidated Net Working Investment between the beginning and
the end of such period, (iv) mandatory reductions of long-term
Indebtedness of the Borrower and its Consolidated Subsidiaries
during such period (adjusted to eliminate the effect of
prepayments on account of Excess Cash Flow for a prior period),
(v) repayments during such period of the revolving credit loans
and short-term Indebtedness of the Borrower and its Consolidated
Subsidiaries which were not made with the proceeds of other
Indebtedness and which repaid amounts cannot be reborrowed or
redrawn under the instruments evidencing such loans and short-term
Indebtedness, (vi) expenditures for plant turnaround costs made in
cash for such period (as the same are or would be set forth in a
consolidated statement of cash flows of the Borrower and its
Consolidated Subsidiaries for such period), (vii) expenditures
incurred in connection with the refinancing of any Indebtedness in
accordance with Section 6.01(a)(iii)(y) during such period and
(viii) cash payments with respect to taxes made during such
period;
provided that Consolidated Net Working Investment at the beginning of such
period shall be determined on a pro forma basis adjusted to give effect (as if
such event had occurred on the first day of such period) to each Permitted
Acquisition made in accordance with Section 6.11 during such period.
"EXCLUDED SUBSIDIARY" means (i) XxXxxxx Air Systems, Inc. (but only so
long as its assets and its net income, determined on the basis of the most
recent financial statements of the Borrower delivered to the Lenders hereunder,
are less than 5% of the consolidated assets of the Borrower and its Consolidated
Subsidiaries and 5% of the consolidated net income of the Borrower and its
Consolidated Subsidiaries, respectively, in each case determined on the basis of
such financial statements), (ii) XxXxxxx Filter Systems, Inc. (but only so long
as the fair market value of the assets held by it does not exceed $100,000),
(iii) XxXxxxx International Inc., (but only so long as the fair market value of
the assets held by it does not exceed $100,000), (iv) XxXxxxx Overseas Inc.,
(but only so long as the fair market value of the assets held by it does not
exceed $100,000), (v) LCI Stone Inc. (but only so long as the fair market value
of the assets held by it does not exceed $100,000), (vi) solely at any date
prior to the earlier of (x) the Term Drawdown Date and (y) the date on which JVC
becomes a Subsidiary, LII Europe and (vii) XxXxxxx Xxxxxxx Inc. (but only so
long as the only asset held by it is the partnership interest in the Avondale
joint venture with Cytec Industries Inc.).
15
"EXCLUDED TAXES" means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.18(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement (or designates a new lending office) or is attributable to
such Foreign Lender's failure to comply with Section 2.16(e), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.16(a).
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the weighted average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"FINANCIAL OFFICER" means the chief financial officer or treasurer of the
Borrower.
"FOREIGN LENDER" means any Lender that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"FOREIGN SUBSIDIARY" means at any time any Subsidiary not organized under
the laws of, or having a principal place of business in, the United States of
America or any State, the District of Columbia or any territory or possession of
the United States of America.
"FRENCH FRANC" (i) or "FF" means, when used in reference to a currency,
lawful money of the Republic of France and (ii) when used in reference to any
Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are bearing interest at a rate determined by reference to the
Adjusted LIBO Rate for Borrowings in French Francs.
"FRENCH FRANC EXPOSURE" means, at any time, the Dollar Amount of all
French Franc Loans outstanding at such time.
"FRENCH FRANC LOAN" means a Loan that is made in French Francs.
16
"FRENCH FRANC PAYMENTS" has the meaning assigned such term in Section
2.17(a).
"GAAP" means generally accepted accounting principles in the United
States of America.
"GOVERNMENTAL AUTHORITY" means the government of the United States of
America, France, any other nation or any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"GUARANTEE" of or by any Person (the "GUARANTOR") means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the "PRIMARY OBLIGOR") in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guarantee issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.
"HAZARDOUS SUBSTANCES" means any toxic, radioactive, corrosive or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydrocarbons, or any substance having constituent elements displaying
any of the foregoing characteristics, regulated under Environmental Laws.
"HEDGING AGREEMENT" means any interest rate protection agreement, foreign
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging arrangement.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (e) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding accounts
payable incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h)
all Capital Lease Obligations of such Person, (i) all obligations, contingent or
otherwise, of such Person as an account party in
17
respect of letters of credit and letters of guarantee and (j) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"INDEBTEDNESS INCURRENCE" means any incurrence by the Borrower or any of
its Subsidiaries of any Indebtedness, other than Indebtedness permitted under
Section 6.01(a)(i) through (xiii), inclusive; provided that if the aggregate
principal amount of the Refinancing Subordinated Notes exceeds $150,000,000, the
incurrence of the Indebtedness evidenced thereby shall be an Indebtedness
Incurrence to the extent of such excess.
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
"INDEMNITY PROCEEDS" means any amounts constituting indemnity payments
received by the Borrower or any of its Subsidiaries pursuant to indemnity
provisions contained in the Acquisition Documents.
"INDENTURE" means the Indenture dated as of August 17, 1994 between the
Borrower and The Bank of New York (successor to NationsBank of Georgia, National
Association), as Trustee, as amended from time to time in accordance with
Section 6.09.
"INDENTURE AMENDMENTS" means the amendments to the provisions of the
Indenture set forth in the Offer to Purchase and Consent Solicitation Statement.
"INTERCOMPANY ACQUISITION LOAN" means the term loan in a principal amount
of up to $13,500,000 made by the Borrower or LII Europe to JVC on the Term
Drawdown Date to pay or finance the payment of a portion of the purchase price
of the Acquisition.
"INTEREST COVERAGE RATIO" means, at the last day of any fiscal quarter,
the ratio of (i) Borrower Consolidated EBITDA for the period of four consecutive
fiscal quarters then ended to (ii) Consolidated Interest Expense for the same
four-quarter period.
"INTEREST ELECTION REQUEST" means a request by the Borrower to convert or
continue a Borrowing in accordance with Section 2.06.
"INTEREST PAYMENT DATE" means (a) with respect to any ABR Loan, the last
day of each March, June, September and December and (b) with respect to any
Eurocurrency Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurocurrency
Borrowing with an Interest Period of more than three months' duration, each day
prior to the last day of such Interest Period that occurs at intervals of three
months' duration after the first day of such Interest Period.
"INTEREST PERIOD" means, with respect to any Eurocurrency Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day in
18
the calendar month that is one, two, three or six months thereafter, as the
Borrower may elect, provided, that (i) if any Interest Period would end on a day
other than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day, (ii) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period, and
(iii) if any Interest Period pertaining to a Eurocurrency Term Loan includes a
date on which a scheduled payment of principal of the Term Loans included in
such Borrowing is required to be made under Section 2.09(a) but does not end on
such date, then (a) the principal amount of each Eurocurrency Term Loan required
to be repaid on such date shall have an Interest Period ending on such date and
(b) the remainder (if any) of each such Eurocurrency Term Loan shall have an
Interest Period determined as set forth above. For purposes hereof, the date of
a Borrowing initially shall be the date on which such Borrowing is made and,
thereafter, shall be the effective date of the most recent conversion or
continuation of such Borrowing.
"ISSUING BANK" means The Chase Manhattan Bank and Hibernia National Bank,
in their respective capacities as the issuer of Letters of Credit hereunder, and
their respective successors in such capacity as provided in Section 2.04(i). The
Issuing Bank may, in its discretion, arrange for one or more Letters of Credit
to be issued by Affiliates of the Issuing Bank, in which case the term "ISSUING
BANK" shall include any such Affiliate with respect to Letters of Credit issued
by such Affiliate.
"JVC" means ChlorAlp S.A.S., a French corporation to which Xxxxx-Xxxxxxx
Chimie will, on or before the Term Drawdown Date, have contributed the Business.
"JVC CONSOLIDATED EBITDA" means for any period (i) consolidated net
income of JVC and its Consolidated Subsidiaries for such period (exclusive of
(x) the portion of net income allocable to minority interests in unconsolidated
Persons to the extent that cash distributions have not actually been received
from such Persons and (y) the effect of any extraordinary or non recurring gain
or loss), plus (ii) to the extent deducted in determining such consolidated net
income, the aggregate amount of (a) consolidated interest expense, (b) income
tax expense and (c) depreciation and amortization (including without limitation
amortization of debt issuance costs) and other similar non-cash charges.
"LC DISBURSEMENT" means a payment to the beneficiary thereof made by the
Issuing Bank pursuant to a Letter of Credit.
"LC EXPOSURE" means, at any time, the sum of (a) all outstanding Letters
of Credit at such time and (b) all LC Disbursements that have not yet been
reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any
Lender at any time shall be its Applicable Percentage (determined on the basis
of the Revolving Commitments) of the total LC Exposure at such time.
19
"LENDERS" means the Persons listed on Schedule 2.01 under the heading
"Lenders" and any other Person that shall have become a party hereto as a Lender
pursuant to an Assignment and Acceptance, other than any such Person that ceases
to be a party hereto as a Lender pursuant to an Assignment and Acceptance.
"LETTER OF CREDIT" means any letter of credit issued pursuant to this
Agreement.
"LEVERAGE RATIO" means, at the last day of any fiscal quarter, the ratio
of (i) Consolidated Indebtedness on such day (other than Indebtedness consisting
of contingent obligations with respect to letters of credit and letters of
guarantee) minus, solely if such day falls on or prior to August 31, 1998, the
aggregate amount of cash and cash equivalents on deposit in the Collateral
Account or in any account with respect to which a lockbox letter referred to in
the Borrower Security Agreement has been delivered to the relevant lockbox bank
and acknowledged by such bank to (ii) Adjusted Borrower EBITDA for the period of
four consecutive fiscal quarters ended on such day. For purposes of determining
Borrower Consolidated EBITDA for purpose of determining Adjusted Borrower EBITDA
at any time during the fiscal quarter in which a Permitted Acquisition has been
made and the three fiscal quarters immediately succeeding such fiscal quarter,
Borrower Consolidated EBITDA shall be increased for any fiscal quarter which
began prior to such Permitted Acquisition by the amount of Borrower Consolidated
EBITDA which the Borrower shall determine would have been attributable to the
acquired assets for the fiscal quarter most recently ended on or prior to the
date of such Permitted Acquisition; provided that (i) the Administrative Agent
shall have consented to the calculation on the basis of which the Borrower
determined such amount to be so attributed and (ii) for the fiscal quarter in
which the Permitted Acquisition has occurred, such increase shall be prorated to
reflect only the days during such fiscal quarter prior to the consummation of
the Permitted Acquisition.
"LIBO RATE" means, with respect to any Eurocurrency Borrowing for any
Interest Period, the rate appearing on Page 3750 (if such Borrowing is in
Dollars) or Page 3740 (if such Borrowing is in French Francs) of the Telerate
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to deposits in the relevant
currency in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as
the rate for deposits in the relevant currency with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the "LIBO RATE" with respect to such Eurocurrency Borrowing
for such Interest Period shall be the rate at which deposits of $5,000,000 or
the equivalent in French Francs, rounded upward to the nearest multiple of
5,000,000 French Francs, and for a maturity comparable to such Interest Period
are offered by the principal London office of the Administrative Agent in
immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period.
"LIEN" means, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, hypothecation, encumbrance, charge or security interest in, on or
of such asset, (b) the interest of
20
a vendor or a lessor under any conditional sale agreement, capital lease or
title retention agreement (or any financing lease having substantially the same
economic effect as any of the foregoing) relating to such asset and (c) in the
case of securities, any purchase option, call or similar right of a third party
with respect to such securities.
"LII EUROPE" means LII Europe S.A.R.L., a French corporation and a
wholly-owned Subsidiary.
"LOAN DOCUMENTS" means this Agreement, the Letters of Credit, the
Subsidiary Guarantee and the Collateral Documents.
"LOANS" means Term Loans or Revolving Loans or any combination thereof.
"LONDON OFFICE" means, at any time, the office of the Administrative
Agent in London specified in or pursuant to Section 9.01 at such time.
"MAJOR CASUALTY PROCEEDS" means (i) the aggregate insurance proceeds
received from a Person other than the Borrower or any of its Subsidiaries in
connection with one or more related events by the Borrower or any of its
Subsidiaries under any insurance policy maintained by the Borrower or any of its
Subsidiaries covering casualty losses with respect to tangible real or personal
property or improvements or (ii) any award or other compensation with respect to
any condemnation of property (or any transfer or disposition of property in lieu
of condemnation) received by the Borrower or any of its Subsidiaries, in either
case only if the amount of such aggregate proceeds or award or other
compensation exceeds $500,000, in each case less any taxes actually paid or to
be payable by the Borrower or any of its Subsidiaries (as estimated by a
Financial Officer, giving effect to the overall tax position of the Borrower) in
respect of receipt of such insurance proceeds or award or other compensation, as
the case may be.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and the Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform any of its obligations under the Loan Documents or (c) the
ability of the Lenders or the Administrative Agent to practically realize the
rights and benefits, taken as a whole, intended to be afforded to the Lenders or
the Administrative Agent, as the case may be, under the Loan Documents.
"MATERIAL INDEBTEDNESS" means Indebtedness (other than the Loans and
Letters of Credit), or obligations in respect of one or more Hedging Agreements,
of any one or more of the Borrower and its Subsidiaries in an aggregate
principal amount exceeding $2,000,000. For purposes of determining Material
Indebtedness, the "PRINCIPAL AMOUNT" of the obligations of the Borrower or any
Subsidiary in respect of any Hedging Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that the Borrower or
such Subsidiary would be required to pay if such Hedging Agreement were
terminated at such time.
"MATURITY DATE" means August 26, 2003.
21
"MORTGAGES" means, collectively, the mortgages, deeds of trust, leasehold
mortgages, leasehold deeds of trust and similar instruments listed on Schedule
1.01, each in form and substance satisfactory to the Administrative Agent,
executed by the Borrower in favor of the Administrative Agent for the benefit of
the Lenders, as amended from time to time.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"NET CASH PROCEEDS" means, with respect to any Indebtedness Incurrence,
Equity Issuance or Asset Sale, an amount equal to the cash proceeds received by
the Borrower or any of its Subsidiaries therefrom or in respect thereof
(including any cash proceeds received as income or other proceeds of any noncash
proceeds of any Asset Sale), less (x) any expenses reasonably incurred by such
Person in respect thereof and (y) solely with respect to any Asset Sale, (i) the
amount of any Indebtedness secured by a Lien on any asset disposed of in such
Asset Sale and required to be discharged from the proceeds thereof and (ii) any
taxes actually paid or to be payable by such Person (as estimated by a Financial
Officer, giving effect to the overall tax position of the Borrower) in respect
of such Asset Sale.
"NEW YORK OFFICE" means, at any time, the office of the Administrative
Agent in New York specified in or pursuant to Section 9.01 at such time.
"OBLIGOR" means each of the Borrower and the Subsidiary Guarantors.
"OFFER TO PURCHASE AND CONSENT SOLICITATION STATEMENT" means the Offer to
Purchase and Consent Solicitation Statement dated August 6, 1997 and made by the
Borrower with respect to the Senior Subordinated Notes and the Indenture, as
amended from time to time; provided that any amendment of any material term of
the Tender Offer or the Indenture Amendments set forth therein (other than an
amendment extending the expiration date of the Tender Offer) shall not be
effective for purposes of this Agreement unless consented to in writing by the
Required Lenders.
"OTHER TAXES" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"PERMITTED ACQUISITION" means any acquisition (other than the Acquisition
or purchases of capital stock of JVC by LII Europe pursuant to the Put/Call
Arrangements), whether in a single transaction or series of related
transactions, by the Borrower or any one or more Subsidiaries, or any
combination thereof, of (i) all or a substantial part of the assets, or a going
concern business or division, of any Person, whether through purchase of assets
or securities, by merger or otherwise, (ii) control of securities of an existing
corporation or other Person having ordinary voting power (apart from rights
accruing under special circumstances) to elect a majority of the board of
directors of such corporation or other Person or (iii) control of a greater
22
than 50% ownership interest in any existing partnership, joint venture or other
Person, provided that:
(w) both before and immediately after giving effect to such
acquisition, no Default shall have occurred and be continuing;
(x) the Person whose assets, securities or equity interests
are being acquired is engaged in the same line of business
activity as the Borrower and its Subsidiaries and businesses
reasonably related thereto;
(y) the Borrower shall be in compliance with Sections 6.12,
6.13 and 6.14 after the Leverage Ratio, Interest Coverage Ratio
and Borrower Consolidated EBITDA are each adjusted with respect to
such acquisition on the date of consummation or proposed
consummation thereof (the "Transaction Date") as follows: in
calculating Borrower Consolidated EBITDA and Consolidated Interest
Expense, (1) the incurrence of any Indebtedness in connection with
such acquisition and the application of the proceeds therefrom
shall be assumed to have occurred on the first day of the period
of four consecutive fiscal quarters (or other period) for which
such amounts are required to be determined in accordance with the
definitions of Leverage Ratio and Interest Coverage Ratio (the
"Reference Period"), (2) pro forma effect shall be given to any
acquisition (including adjustments to operating results required
to be made in accordance with GAAP) which occurs during the
Reference Period or subsequent to the Reference Period and prior
to the Transaction Date as if such acquisition had occurred on the
first day of the Reference Period, (3) the incurrence of any
Indebtedness during the Reference Period or subsequent to the
Reference Period and prior to the Transaction Date and the
application of the proceeds therefrom shall be assumed to have
occurred on the first day of such Reference Period and (4)
Consolidated Interest Expense attributable to any Indebtedness
(whether existing or being incurred) bearing a floating interest
rate shall be computed on a pro forma basis as if the rate in
effect on the date of computation had been the applicable rate for
the entire period, unless such Person or any of its Subsidiaries
is a party to an interest party swap or cap or similar agreement
(which shall remain in effect for the twelve month period after
the Transaction Date) which has the effect of fixing the interest
rate on the date of computation, in which case such rate (whether
higher or lower) shall be used; and
(z) at least thirty days prior to the closing date for any
such acquisition (or, in the case of any acquisition that occurs
within 30 days after the Effective Date, within such time as the
Borrower and the Administrative Agent agree), the Borrower shall
have delivered to each of the Lenders (1) a compliance certificate
certifying the Borrower's compliance with the provisions of this
Agreement, including, without limitation, Sections 6.12, 6.13 and
6.14, after giving effect on a pro forma basis to such acquisition
and (2) a report of the chief financial officer or chief
accounting officer of the Borrower, in a form and providing
sufficient detail and justification for the information provided
therein, including assumptions, as shall be found to be reasonable
by the Administrative Agent in its good faith discretion after
completion
23
of reasonable due diligence, establishing (A) the basis for such
certification and (B) that after giving effect to such acquisition
and the financing therefor, the Borrower shall be in compliance on
a pro forma basis until the end of the fiscal year immediately
following the fiscal year in which such acquisition is proposed to
be consummated with the covenants contained in Sections 6.12, 6.13
and 6.14.
"PERMITTED ENCUMBRANCES" means:
(a) Liens imposed by law for taxes that are not yet due or
are being contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the
ordinary course of business or with respect to obligations that
are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each
case in the ordinary course of business; and
(e) easements, zoning restrictions, rights-of-way and
similar encumbrances on real property imposed by law or arising in
the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of
business of the Borrower or any Subsidiary;
provided that the term "PERMITTED ENCUMBRANCES" (x) shall not include any Lien
securing Indebtedness (other than the Loans and any reimbursement obligations in
respect of any LC Disbursement) and (y) when used with respect to any Collateral
subject to a Mortgage, shall mean the "PERMITTED ENCUMBRANCES" as defined in
such Mortgage only.
"PERMITTED HOLDERS" means: (i) any of Xxxxxxx Xxx Xxxxxxxx XxXxxxx, W.
Xxxxxx XxXxxxx, III, Xxxxxxxx X. XxXxxxx, Xxxxxxx X. XxXxxxx, Xxxxx X. Xxxx,
Xxxxxxx X. Xxxxx, Xxxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx, Xxxx X.X. Xxxxxxxx,
Xxxxxx X. Xxxxxx, X.X. Xxxxxx, Xx. and Xxxxxxx X. Xxxxx, (ii) spouses or lineal
descendants of the Persons described in clause (i), (iii) in the event of
incompetence or death of any of the Persons described in clauses (i) or (ii),
such Person's estate, executor, administrator, committee or other personal
representative or beneficiaries and (iv) any trusts created for the benefit of
the Persons described in clause (i), (ii) or (iii).
"PERMITTED INVESTMENTS" means:
24
(a) direct obligations of, or obligations the principal of
and interest on which are unconditionally guaranteed by, the
United States of America (or by any agency thereof to the extent
such obligations are backed by the full faith and credit of the
United States of America), in each case maturing within one year
from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270
days from the date of acquisition thereof and having, at such date
of acquisition, the highest credit rating obtainable from Standard
& Poor's Ratings Group or from Xxxxx'x Investor Service Inc.;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the
date of acquisition thereof issued or guaranteed by or placed
with, and money market deposit accounts issued or offered by, any
domestic office of any commercial bank organized under the laws of
the United States of America or any State thereof which has a
combined capital and surplus and undivided profits of not less
than $500,000,000; and
(d) fully collateralized repurchase agreements with a term
of not more than 30 days for securities described in clause (a)
above and entered into with a financial institution satisfying the
criteria described in clause (c) above.
"PERSON" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"PLAN" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "EMPLOYER" as defined in Section 3(5) of
ERISA.
"PLAN REVERSION PROCEEDS" means the aggregate amount of payments received
by the Borrower or any of its Subsidiaries from the termination of a Plan.
"PLEDGE AGREEMENT" means the Borrower Pledge Agreement or the Subsidiary
Pledge Agreement, and "PLEDGE AGREEMENTS" means any combination of the
foregoing.
"PRIME RATE" means the rate of interest per annum publicly announced from
time to time by The Chase Manhattan Bank as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective from and including the date such change is publicly announced as being
effective.
"PUT/CALL AGREEMENT" means the Put and Call Agreement dated as of August
1, 1997 among Xxxxx-Xxxxxxx Chimie, JVC, LII Europe and the Borrower, as in
effect on the Term Drawdown Date in the form approved by the Lenders and as
further amended from time to time in accordance with Section 6.09.
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"PUT/CALL ARRANGEMENTS" means (i) the put arrangements pursuant to which
Xxxxx-Xxxxxxx Chimie has the right to sell to LII Europe, and LII Europe has the
obligation to purchase from Xxxxx-Xxxxxxx Chimie, the capital stock of JVC owned
by Xxxxx-Xxxxxxx Chimie, (ii) the put arrangements pursuant to which LII Europe
has the right to sell to Xxxxx-Xxxxxxx Chimie, and Xxxxx-Xxxxxxx Chimie has the
obligation to purchase from LII Europe, the capital stock of JVC owned by LII
Europe and (iii) the call arrangements pursuant to which Xxxxx-Xxxxxxx Chimie
has the right to purchase from LII Europe, and LII Europe has the obligation to
sell to Xxxxx-Xxxxxxx Chimie, the capital stock of JVC owned by LII Europe, all
as set forth in the Put/Call Agreement.
"QUALIFIED IPO" means any Equity Issuance consisting of the sale of
shares of common stock of the Borrower by and for the account of the Borrower
pursuant to an underwritten initial public offering registered under the
Securities Act of 1933, as amended; provided that the Net Cash Proceeds with
respect thereto are at least equal to $100,000,000.
"REDUCTION PERCENTAGE" means (i) in the case of an Equity Issuance, 50%,
and (ii) in all other cases, 100%.
"REFINANCING DATE" means the date on which the Refinancing Subordinated
Notes shall have been issued, the Tender Offer shall have been consummated and
the Indenture Amendments shall have become effective.
"REFINANCING SUBORDINATED NOTES" means debt securities of the Borrower
issued after the Effective Date in an aggregate principal amount not in excess
of $175,000,000 so long as (i) the material terms of such securities (including
without limitation tenor and interest payments) have been approved in writing by
the Administrative Agent prior to the issuance thereof; provided that in no
event shall (x) the final maturity date of such securities fall prior to seven
years after the date of issuance thereof or (y) the interest rate applicable
thereto exceed 11% per annum, and (ii) the obligations of the Borrower with
respect to such securities are subordinated in right of payment to the
obligations of the Borrower under the Financing Documents pursuant to
subordination provisions which have been approved in writing by the
Administrative Agent.
"REGISTER" has the meaning set forth in Section 9.04.
"REGULATED ACTIVITY" means any generation, treatment, storage, recycling,
transportation or disposal of any Hazardous Substance.
"REGULATORY GUARANTEES" means reimbursement obligations incurred by the
Borrower in respect of any bank guaranty or letter of credit or similar
undertaking, issued for the account of JVC in accordance with applicable law and
providing for posting security for obligations under certain environmental and
other regulatory permits, so long as the posting of such security is required by
applicable law or is a condition precedent to the issuance of any governmental
license, permit or consent. Such obligations shall be excluded from
"Consolidated Indebtedness" and shall be permitted under Section 6.01(a)(viii),
in each case for any date on or after the Term Drawdown Date, up to an amount to
be agreed upon between the Borrower and the Lenders on or
26
prior to the Term Drawdown Date (and, if the Borrower and the Lenders shall not
agree upon any such amount, such amount shall be zero).
"RELATED PARTIES" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"RELEASE" means any discharge, emission or release, including a "Release"
as defined in CERCLA at 42 U.S.C. Section 9601(22). The term "Released" shall
have a corresponding meaning.
"REQUIRED LENDERS" means, at any time, Lenders having in the aggregate at
least 51% of the sum of (i) Revolving Credit Exposures and unused Revolving
Commitments at such time and (ii) the aggregate Dollar Amount of the Term Loans
outstanding at such time (or, if no Term Loans are outstanding at such time, the
aggregate Term Commitments at such time).
"RESTRICTED PAYMENT" means any dividend or other distribution (whether in
cash, securities or other property) with respect to any shares of any class of
capital stock of the Borrower or any Subsidiary, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such shares of capital stock of the Borrower
or any option, warrant or other right to acquire any such shares of capital
stock of the Borrower.
"REVOLVING COMMITMENT" means, with respect to each Lender, the commitment
of such Lender to make Revolving Loans and to acquire participations in Letters
of Credit hereunder, expressed as an amount representing the maximum aggregate
amount of such Lender's Revolving Credit Exposure hereunder, as such commitment
may be (x) reduced from time to time pursuant to Sections 2.07(c) and 2.09(b)
and (y) reduced or increased from time to time pursuant to assignments by or to
such Lender pursuant to Section 9.04. The initial amount of each Lender's
Revolving Commitment is set forth on Schedule 2.01 under the heading "Revolving
Commitment", or in the Assignment and Acceptance pursuant to which such Lender
shall have assumed its Revolving Commitment, as applicable. The initial
aggregate amount of the Lenders' Revolving Commitments is $100,000,000.
"REVOLVING CREDIT EXPOSURE" means, with respect to any Lender at any
time, the sum of (i) the aggregate Dollar Amount of such Lender's Loans
outstanding at such time and (ii) its LC Exposure at such time.
"REVOLVING LOAN" means a loan made pursuant to Section 2.01(b).
"XXXXX-XXXXXXX" means Xxxxx-Xxxxxxx, X.X., a French company, and its
successors.
"XXXXX-XXXXXXX CHIMIE" means Xxxxx-Xxxxxxx Chimie, S.A., a wholly owned
subsidiary of Xxxxx-Xxxxxxx.
27
"SECURITY AGREEMENT" means the Borrower Security Agreement or the
Subsidiary Security Agreement, and "SECURITY AGREEMENTS" means both of them.
"SENIOR SUBORDINATED NOTES" means the 13% Senior Subordinated Notes Due
2004 issued pursuant to the Indenture.
"STATUTORY RESERVE RATE" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as "EUROCURRENCY LIABILITIES" in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurocurrency Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"STOCK PURCHASE AGREEMENT" means the Stock Purchase Agreement dated as of
August 1, 1997 among Xxxxx-Xxxxxxx Chimie, JVC, LII Europe and the Borrower, as
in effect on the Term Drawdown Date in the form approved by the Lenders and as
further amended from time to time in accordance with Section 6.09.
"SUBSIDIARY" means, with respect to any Person (the "PARENT") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity of which securities or other ownership interests representing more than
50% of the equity or more than 50% of the ordinary voting power or, in the case
of a partnership, more than 50% of the general partnership interests are, as of
such date, owned, controlled or held by the parent or one or more subsidiaries
of the parent or by the parent and one or more subsidiaries of the parent.
"SUBSIDIARY" means any subsidiary of the Borrower.
"SUBSIDIARY GUARANTEE" means the guarantee agreement substantially in the
form of Exhibit D by each Subsidiary Guarantor for the benefit of the
Administrative Agent, as amended from time to time.
"SUBSIDIARY GUARANTORS" means each Person who becomes a party to the
Subsidiary Guarantee pursuant to Section 5.09.
"SUBSIDIARY PLEDGE AGREEMENT" means the pledge agreement substantially in
the form of Exhibit E among each Subsidiary Guarantor and the Administrative
Agent, as amended from time to time.
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"SUBSIDIARY SECURITY AGREEMENT" means the security agreement
substantially in the form of Exhibit F hereto among each Subsidiary Guarantor
and the Administrative Agent, as amended from time to time.
"TAXES" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TENDER OFFER" means the offer by the Borrower to purchase all, but not
less than a majority of, the Senior Subordinated Notes on the terms set forth in
the Offer to Purchase and Consent Solicitation Statement.
"TERM COMMITMENT" means, with respect to each Lender, the commitment of
such Lender to make Term Loans hereunder, expressed as an amount representing
the maximum aggregate amount of such Lender's Term Loans hereunder, as such
commitment may be (x) reduced from time to time pursuant to Section 2.07(c) and
(y) reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 9.04. The initial amount of each Lender's Term
Commitment is set forth on Schedule 2.01 under the heading "Term Commitment", or
in the Assignment and Acceptance pursuant to which such Lender shall have
assumed its Term Commitment, as applicable. The initial aggregate amount of the
Lenders' Term Commitments is $60,000,000.
"TERM DRAWDOWN DATE" means the date on which the first Term Borrowing is
made hereunder.
"TERM LOAN" means a loan made pursuant to Section 2.01(a).
"TRANSACTIONS" means the execution, delivery and performance by the
Borrower of the Loan Documents, the borrowing of Loans, the use of the proceeds
thereof and the issuance of Letters of Credit hereunder.
"TURBINE LEASE GUARANTEE" means the reimbursement obligations incurred by
the Borrower to Xxxxx-Xxxxxxx in connection with Xxxxx-Xxxxxxx'x Guarantee of
lease payments due on three turbine generators leased by CEVCO from Banque
Paribas, up to an amount equivalent to $2,500,000 per annum for each year ending
on or after the Term Drawdown Date and prior to the date on which JVC becomes a
Subsidiary and up to an amount equivalent to $5,000,000 per annum for each year
ending thereafter.
"TYPE", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate for Borrowings
in Dollars, the Adjusted LIBO Rate for Borrowings in French Francs or the
Alternate Base Rate.
"WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
29
SECTION 1.02. Classification of Loans and Borrowings. For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"REVOLVING LOAN") or by Type (e.g., a "EURODOLLAR LOAN") or by Class and Type
(e.g., a "EURODOLLAR REVOLVING LOAN"). Borrowings also may be classified and
referred to by Class (e.g., a "REVOLVING BORROWING") or by Type (e.g., a
"EURODOLLAR BORROWING") or by Class and Type (e.g., a "EURODOLLAR REVOLVING
BORROWING").
SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "INCLUDE", "INCLUDES" and "INCLUDING" shall
be deemed to be followed by the phrase "WITHOUT LIMITATION". The word "WILL"
shall be construed to have the same meaning and effect as the word "SHALL".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "HEREIN", "HEREOF" and "HEREUNDER", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"ASSET" and "PROPERTY" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time (subject to
Section 6.10); provided that, if the Borrower notifies the Administrative Agent
that the Borrower requests an amendment to any provision hereof to eliminate the
effect of any change occurring after the date hereof in GAAP or in the
application thereof on the operation of such provision (or if the Administrative
Agent notifies the Borrower that the Required Lenders request an amendment to
any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then
such provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective until such
notice shall have been withdrawn or such provision amended in accordance
herewith.
ARTICLE II
The Credits
SECTION 2.01. Commitments. (a) Subject to the terms and conditions set
forth herein, each Lender agrees to make loans to the Borrower on the Term
Drawdown Date in an aggregate Dollar Amount that will not result in such
Lender's Term Loans exceeding such Lender's Term Commitment. Loans made pursuant
to this subsection are not revolving in nature and amounts of such loans repaid
or prepaid may not be reborrowed.
30
(b) Subject to the terms and conditions set forth herein, each Lender
agrees to make loans to the Borrower from time to time during the Availability
Period in an aggregate Dollar Amount that will not result in such Lender's
Revolving Credit Exposure exceeding such Lender's Revolving Commitment. Within
the foregoing limits and subject to the terms and conditions set forth herein,
the Borrower may borrow, prepay and reborrow Revolving Loans.
SECTION 2.02. Loans and Borrowings. (a) Each Term Loan shall be made as
part of a Borrowing consisting of Term Loans made by the Lenders ratably in
accordance with their respective Term Commitments. Each Revolving Loan shall be
made as part of a Borrowing consisting of Revolving Loans made by the Lenders
ratably in accordance with their respective Revolving Commitments. The failure
of any Lender to make the Loans required to be made by it shall not relieve any
other Lender of its obligations hereunder; provided that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make its Loans as required.
(b) Subject to Section 2.13, each Borrowing shall be comprised entirely
of ABR Loans, Eurodollar Loans or French Franc Loans as the Borrower may request
in accordance herewith. Each Lender at its option may make any Eurocurrency Loan
by causing any domestic or foreign branch or Affiliate of such Lender to make
such Loan; provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with the terms of
this Agreement.
(c) At the commencement of each Interest Period for any Borrowing, such
Borrowing shall be in an aggregate Dollar Amount that is an integral multiple of
$500,000 and not less than $1,000,000; provided that (x) any French Franc
Borrowing may be in such an aggregate Dollar Amount reduced to the extent
required so that the aggregate amount of such French Franc Borrowing is an
integral multiple of FF 2,500,000 and not less than FF 5,000,000, (y) any ABR
Revolving Borrowing may be in an aggregate Dollar Amount that is equal to the
entire unused balance of the total Revolving Commitments or that is required to
finance the reimbursement of an LC Disbursement as contemplated by Section
2.04(e) and (z) no Borrowing shall be a French Franc Borrowing if, after giving
effect thereto, the French Franc Exposure will exceed $75,000,000. Borrowings of
more than one Type and Class may be outstanding at the same time; provided that
there shall not at any time be more than a total of nine Eurocurrency Borrowings
outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert or continue, any
Borrowing if the Interest Period requested with respect thereto would end after
the Maturity Date.
SECTION 2.03. Requests for Borrowings. To request a Borrowing, the
Borrower shall notify the Administrative Agent of such request by telephone, not
later than 12:30 p.m., New York City time, (a) in the case of a Eurodollar
Borrowing, three Business Days before the date of the proposed Borrowing, (b) in
the case of a French Franc Borrowing, four Business Days before the date of the
proposed Borrowing or (c) in the case of an ABR Borrowing, on the date of the
proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable
and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written
31
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower. Each such telephonic and written Borrowing Request shall specify
the following information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be a Term Borrowing made on
the Term Drawdown Date only or a Revolving Borrowing;
(iv) whether such Borrowing is to be an ABR Borrowing, a
Eurodollar Borrowing or a French Franc Borrowing; (it being understood
that upon the making of the Loans included in any French Franc Borrowing
the Borrower shall be deemed to represent and warrant that the French
Franc Exposure does not exceed $75,000,000);
(v) in the case of a Eurocurrency Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "INTEREST PERIOD"; and
(vi) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.05.
If no election as to the Type of Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurocurrency Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request with respect to a
Borrowing of either Class in accordance with this Section, the Administrative
Agent shall advise each Lender with a Commitment of such Class of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.04. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower may request the issuance of Letters of
Credit in Dollars for its own account or the account of any Subsidiary for the
purpose of supporting obligations of the Borrower or such Subsidiary incurred in
the ordinary course of business, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic
32
communication, if arrangements for doing so have been approved by the Issuing
Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance
of the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, the date of issuance, amendment,
renewal or extension, the date on which such Letter of Credit is to expire
(which shall comply with paragraph (c) of this Section), the amount of such
Letter of Credit, the name and address of the account party to be named therein
(if a Subsidiary) and of the beneficiary thereof and such other information as
shall be necessary to prepare, amend, renew or extend such Letter of Credit. If
requested by the Issuing Bank, the Borrower also shall submit a letter of
credit application on the Issuing Bank's standard form in connection with any
request for a Letter of Credit. A Letter of Credit shall be issued, amended,
renewed or extended only if it is in such form, and contains such terms and
supports such transactions in the ordinary course of business, as are
reasonably satisfactory to the Issuing Bank, and if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension, (i) the LC Exposure shall not exceed the
lesser of (x) $30,000,000 and (y) the total Revolving Commitments at such time,
and (iii) no more than twenty Letters of Credit shall be outstanding.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the earlier of (i) the date one year after the date of
the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Lender, and each Lender hereby acquires from the Issuing
Bank, a participation in such Letter of Credit equal to such Lender's Applicable
Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the Issuing Bank, such Lender's Applicable Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the
date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit or the occurrence and
continuance of a Default or reduction or termination of the Revolving
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in
respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement
by paying to the Administrative Agent an amount equal to the amount of such LC
Disbursement by 12:00 noon, New York City time, on the date that such LC
Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 10:00 a.m., New York City time, on such date,
33
or, if such notice has not been received by the Borrower prior to such time on
such date, then not later than 12:00 noon, New York City time, on (i) the
Business Day that the Borrower receives such notice, if such notice is received
prior to 10:00 a.m., New York City time, on the day of receipt, or (ii) the
Business Day immediately following the day that the Borrower receives such
notice, if such notice is not received prior to such time on the day of
receipt; provided that, if such LC Disbursement is not less than $1,000,000,
the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such payment be financed with an
ABR Revolving Borrowing in an equivalent amount and, to the extent so financed,
the Borrower's obligation to make such payment shall be discharged and replaced
by the resulting ABR Revolving Borrowing. If the Borrower fails to make such
payment when due, the Administrative Agent shall notify each Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender's Applicable Percentage thereof. Promptly following
receipt of such notice, each Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same
manner as provided in Section 2.05 with respect to Revolving Loans made by such
Lender (and Section 2.05 shall apply, mutatis mutandis, to the payment
obligations of the Lenders), and the Administrative Agent shall promptly pay to
the Issuing Bank the amounts so received by it from the Lenders. Promptly
following receipt by the Administrative Agent of any payment from the Borrower
pursuant to this paragraph, the Administrative Agent shall distribute such
payment to the Issuing Bank or, to the extent that Lenders have made payments
pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders
and the Issuing Bank as their interests may appear. Any payment made by a
Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of ABR Revolving Loans as contemplated
above) shall not constitute a Loan and shall not relieve the Borrower of its
obligation to reimburse such LC Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement or any other Loan Document, or any term or provision
therein, (ii) any draft or other document presented under a Letter of Credit
proving to be forged, fraudulent or invalid in any respect or any statement
therein being untrue or inaccurate in any respect, (iii) payment by the Issuing
Bank under a Letter of Credit against presentation of a draft or other document
that does not comply with the terms of such Letter of Credit, or (iv) any other
event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of, or provide a right of setoff against, the
Borrower's obligations hereunder. None of the Administrative Agent, the Lenders
or the Issuing Bank, or any of their Related Parties, shall have any liability
or responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank
34
from liability to the Borrower to the extent of any direct damages (as opposed
to consequential damages, claims in respect of which are hereby waived by the
Borrower to the extent permitted by applicable law) suffered by the Borrower
that are caused by the Issuing Bank's failure to exercise care when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof. The parties hereto expressly agree that, in the absence
of gross negligence or wilful misconduct on the part of the Issuing Bank (as
finally determined by a court of competent jurisdiction), the Issuing Bank
shall be deemed to have exercised care in each such determination. In
furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the Borrower by telephone (confirmed by telecopy) of
such demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; provided that any failure to give or delay in giving
such notice shall not relieve the Borrower of its obligation to reimburse the
Issuing Bank and the Lenders with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement,
then, unless the Borrower shall reimburse such LC Disbursement in full on the
date such LC Disbursement is made, the unpaid amount thereof shall bear
interest, for each day from and including the date such LC Disbursement is made
to but excluding the date that the Borrower reimburses such LC Disbursement, at
the rate per annum then applicable to ABR Revolving Loans; provided that, if the
Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph
(e) of this Section, then Section 2.12(c) shall apply. Interest accrued pursuant
to this paragraph shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any Lender pursuant to
paragraph (e) of this Section to reimburse the Issuing Bank shall be for the
account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at
any time by written agreement among the Borrower, the Administrative Agent, the
replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent
shall notify the Lenders of any such replacement of the Issuing Bank. At the
time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.11(b). From and after the effective date of any such replacement, (i)
the successor Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be issued
thereafter and (ii) references herein to the term "ISSUING BANK" shall be deemed
to refer to such successor or to any previous Issuing Bank, or to such successor
and all previous Issuing Banks, as the context shall require. After the
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with
35
respect to Letters of Credit issued by it prior to such replacement, but shall
not be required to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Lenders with LC Exposure representing at least 51%
of the total LC Exposure demanding the deposit of cash collateral pursuant to
this paragraph, the Borrower shall deposit in the Collateral Account an amount
in cash equal to the LC Exposure as of such date plus any accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence
of any Event of Default with respect to the Borrower described in clause (h) or
(i) of Article VII.
SECTION 2.05. Funding of Borrowings. (a) Each Lender shall make each Loan
to be made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds (i) by 1:30 p.m. (New York City time), to the
Administrative Agent at its New York Office, in Dollars, if such Loan is to be
made in Dollars and (ii) by 1:30 p.m. (London time), to the Administrative Agent
at its London Office, in French Francs, if such Loan is to be made in French
Francs. The Administrative Agent will make such Loans available to the Borrower
by promptly crediting the amounts so received, in like funds, to an account of
the Borrower maintained with the Administrative Agent in New York City (if such
Loans are in Dollars) or in London (if such Loans are in French Francs) and, in
each case, designated by the Borrower in the applicable Borrowing Request;
provided that ABR Revolving Loans made to finance the reimbursement of an LC
Disbursement as provided in Section 2.04(e) shall be remitted by the
Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such Borrowing
(if any), the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the Federal Funds Effective Rate (if the Loans
included in such Borrowing are Dollar Loans) or the relevant LIBO Rate (if the
Loans included in such Borrowing are French Franc Loans) (or, solely if the
Administrative Agent shall have determined that the Federal Funds Effective Rate
or the relevant LIBO Rate, as applicable, will not adequately and fairly reflect
the cost of funds of the Administrative Agent, a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation) or (ii) in the case of the Borrower, the interest rate applicable
to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.
36
SECTION 2.06. Interest Elections. (a) Each Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurocurrency Borrowing, shall have an initial Interest Period as specified in
such Borrowing Request. Thereafter, the Borrower may elect to convert such
Borrowing to a different Type (if it is a Dollar Borrowing) or may elect to
continue such Borrowing and, in the case of a Eurocurrency Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrower may
elect different options with respect to different portions of the affected
Borrowing, in which case each such portion shall be allocated ratably among the
Lenders holding the Loans comprising such Borrowing, and the Loans comprising
each such portion shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing,
a Eurodollar Borrowing or a French Franc Borrowing; provided that no
resulting Borrowing may be a French Franc Borrowing if, after giving
effect to such election, the French Franc Exposure will exceed
$75,000,000 (and upon the effectiveness of such election, the Borrower
shall be deemed to represent and warrant that the French Franc
Exposure does not exceed $75,000,000); and
(iv) if the resulting Borrowing is a Eurocurrency Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of
the term "INTEREST PERIOD".
If any such Interest Election Request requests a Eurocurrency Borrowing
but does not specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month's duration.
37
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request
with respect to a Eurocurrency Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing, if it is a Eurodollar Borrowing, or shall be continued with an
Interest Period of one month, if it is a French Franc Borrowing. Notwithstanding
any contrary provision hereof, if an Event of Default has occurred and is
continuing and the Administrative Agent, at the request of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing (i)
no outstanding Dollar Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.07. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Term Commitments shall terminate on the Term Drawdown
Date simultaneous with the funding of the Term Loans made on the Term Drawdown
Date.
(b) Unless previously terminated, and subject to Section 2.09(b)(i), the
Revolving Commitments shall terminate on the Maturity Date.
(c) The Borrower may at any time terminate, or from time to time reduce,
the Commitments of either Class; provided that (i) each reduction of the
Commitments of either Class shall be in an amount that is an integral multiple
of $500,000 and not less than $1,000,000 and (ii) the Borrower shall not
terminate or reduce the Revolving Commitments if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.10,
the total Revolving Credit Exposures would exceed the total Revolving
Commitments.
(d) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments of either Class under paragraph (c) of this
Section at least five Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders having Commitments of the affected Class of the
contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent. Each reduction
of the Commitments of either Class shall be made ratably among the Lenders in
accordance with their respective Commitments of such Class.
SECTION 2.08. Maturity of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Term Lender the then unpaid principal amount of each Term Loan
on the Maturity Date, subject to Sections 2.09(a) and 2.09(b)(i).
38
(b) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Revolving Loan on the Maturity Date, subject to Section
2.09(b)(ii).
(c) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(d) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made 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 Borrower 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.
(e) The entries made in the accounts maintained pursuant to paragraph (c)
or (d) of this Section 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 Borrower to repay
the Loans in accordance with the terms of this Agreement.
(f) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note 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. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
SECTION 2.09. Mandatory Prepayment of Loans and Reduction of Revolving
Commitments. (a) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Term Lender, on each date set forth
below, an aggregate principal amount of the Term Loans equal to the amount set
forth below opposite such date (as such amount may be reduced pursuant to
paragraph (b)(v) below or Section 2.10(c)):
39
DATE AMOUNT
----------------- ----------
December 31, 1997 $1,250,000
March 31, 1998 1,250,000
June 30, 1998 1,250,000
September 30, 1998 1,250,000
December 31, 1998 1,250,000
March 31, 1999 1,250,000
June 30, 1999 1,250,000
September 30, 1999 2,500,000
December 31, 1999 2,500,000
March 31, 2000 2,500,000
June 30, 2000 2,500,000
September 30, 2000 3,125,000
December 31, 2000 3,125,000
March 31, 2001 3,125,000
June 30, 2001 3,125,000
September 30, 2001 3,125,000
December 31, 2001 3,125,000
March 31, 2002 3,125,000
June 30, 2002 3,125,000
September 30, 2002 3,750,000
December 31, 2002 3,750,000
March 31, 2003 3,750,000
June 30, 2003 3,750,000
Maturity Date 1,250,000
(b) (i) In addition, the Borrower shall prepay Term Loans (or the Term
Commitments shall be reduced) and, solely in the case of clause (x) below, the
Revolving Commitments shall be reduced as follows:
(x) on the date which the Borrower or any of its Subsidiaries
shall receive any Net Cash Proceeds with respect to (1) any Asset Sale
made in any fiscal year, but solely if, and solely to the extent that,
the aggregate Net Cash Proceeds from such Asset Sale, when combined
with all other Asset Sales previously made during such fiscal year,
exceeds $500,000, (2) any Indebtedness Incurrence, (3) any Equity
Issuance or (4) any Plan Reversion Proceeds, the Borrower shall prepay
Term Loans (or, if the Term Drawdown Date has not yet occurred and
Term Commitments are outstanding, the Term Commitments shall be
reduced until the Term Commitments have been reduced to zero) and the
Revolving Commitments shall be reduced, in the aggregate, by an amount
equal to the Reduction Percentage of such Net Cash Proceeds or Plan
Reversion Proceeds, as the case may be; provided that if the Net Cash
Proceeds or Plan Reversion Proceeds are less than $500,000, such
prepayment or reduction shall be made upon receipt of proceeds such
that, together with all other such amounts not previously applied,
aggregate Net Cash Proceeds and Plan Reversion Proceeds are equal to
at least $500,000; and provided further that the Borrower shall not be
40
required to apply to such prepayment or reduction (A) Net Cash
Proceeds of sales of assets held for disposition and set forth in
Schedule 2.09 and (B) up to $10,000,000 of Net Cash Proceeds of other
Asset Sales which would otherwise be required to be applied to such
prepayment or reduction, in either case to the extent such Net Cash
Proceeds are reinvested within 270 days of such Asset Sales in
productive assets of a kind used or usable in the business of the
Borrower or such Subsidiary; and
(y) on or before the 95th day after the end of each fiscal year
beginning with the fiscal year ending in 1999, the Borrower shall
prepay Term Loans by an amount equal to 50% of Excess Cash Flow for
such fiscal year.
(ii) In addition, promptly following receipt by the Borrower or any of its
Subsidiaries of any Major Casualty Proceeds or Indemnity Proceeds, the Borrower
shall deposit with the Administrative Agent in the Collateral Account an amount
of cash or Liquid Investments (as defined in the Borrower Security Agreement)
equal to the amount of such Major Casualty Proceeds or Indemnity Proceeds, as
the case may be. So long as no Default has occurred and is continuing, an
amount equal to the aggregate amount of such cash proceeds which such Person
has expended or committed to expend for the restoration or replacement of the
asset in respect of which such Major Casualty Proceeds payment was made or to
remedy the event giving rise to such Indemnity Proceeds payment, shall be
released by the Administrative Agent to the Borrower; provided that if within
180 days of receipt of such payment such Person shall not have expended or
committed to expend an equivalent amount for the restoration or replacement of
the asset in respect of which such Major Casualty Proceeds payment was made, or
to remedy the event giving rise to such Indemnity Proceeds payment, the excess
of the amount of such payment over the amount of such expenditures and
commitments shall be applied to prepay the Term Loans (or, if the Term Drawdown
Date has not yet occurred and Term Commitments are outstanding, reduce the Term
Commitments until the Term Commitments have been reduced to zero) and reduce
the Revolving Commitments on such 180th day.
The prepayments and reductions required pursuant to clauses (i) and (ii)
of this paragraph shall be effected in the following order: first, the Borrower
shall prepay the Term Loans until the Term Loans have been paid in full (or, if
the Term Drawdown Date has not yet occurred and Term Commitments are
outstanding, reduce the Term Commitments until the Term Commitments have been
reduced to zero), and second, the Revolving Commitments shall be reduced;
provided that no prepayment made pursuant to clause (b)(i)(y) shall reduce the
Revolving Commitments.
(iii) If on the date of any reduction of the Revolving Commitments
pursuant to clauses (i) or (ii) of this paragraph the aggregate Revolving
Credit Exposure on such date exceeds the aggregate Revolving Commitments on
such date as then reduced (or if the Revolving Commitments have terminated but
there is still Revolving Credit Exposure), the Borrower shall apply an amount
equal to such excess to prepay the Revolving Loans and cash collateralize
Letters of Credit so that after giving effect thereto the Revolving Credit
Exposure of each Lender does not exceed its Revolving Commitment as then
reduced (or until there is no Revolving Credit Exposure). The prepayments and
cash collateralization required pursuant to this clause shall be effected in
the following order: first, the Borrower shall prepay the Revolving Loans
41
until the Revolving Loans have been paid in full and second, the Borrower shall
cash collateralize Letters of Credit by depositing any remaining amounts in the
LC Collateral Account. In determining Revolving Credit Exposure for purposes of
this clause, LC Exposure shall be reduced to the extent that Letters of Credit
have been cash collateralized as contemplated by the previous sentence.
(iv) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment or reduction under this paragraph not
later than 12:30 p.m., New York City time, three Business Days before the date
of prepayment or reduction, as the case may be (or, solely if such prepayment
will be a prepayment of ABR Loans only, no later than 12:30 p.m., New York City
time, on the date of such prepayment). Each such notice shall be irrevocable
and shall specify the prepayment date and the principal amount of each
Borrowing or portion thereof to be prepaid; provided that, if a notice of
prepayment is given in connection with a conditional notice of termination of
the Commitments as contemplated by Section 2.07, then such notice of prepayment
may be revoked if such notice of termination is revoked in accordance with
Section 2.07. Each prepayment of Loans of either Class made by the Borrower
pursuant to this Section shall be applied to such Borrowing or Borrowings of
such Class as the Borrower may designate in the notice of prepayment delivered
by the Borrower with respect thereto (or, failing such designation, as
determined by the Administrative Agent), and shall be applied to repay ratably
the Loans of such Class of the several Lenders included in such Borrowing or
Borrowings. Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the affected Lenders of the
contents thereof. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.12.
(v) The amount of any prepayment of the Term Loans made by the Borrower
pursuant to clauses (i) or (ii) of this paragraph shall be applied to reduce
ratably the amount of each subsequent scheduled repayment of the Term Loans to
be made by the Borrower pursuant to subsection (a).
SECTION 2.10. Optional Prepayment of Loans. (a) The Borrower shall have
the right at any time and from time to time to prepay any Borrowing of either
Class in whole or in part, subject to prior notice in accordance with paragraph
(b) of this Section.
(b) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder not later than 12:30 p.m.,
New York City time, three Business Days before the date of prepayment (or,
solely if such prepayment will be a prepayment of ABR Loans only, no later than
12:30 p.m., New York City time, on the date of such prepayment). Each such
notice shall be irrevocable and shall specify the prepayment date, the Class
and the principal amount of each Borrowing or portion thereof to be prepaid;
provided that, if a notice of prepayment is given in connection with a
conditional notice of termination of the Commitments as contemplated by Section
2.07, then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.07. Promptly following
receipt of any such notice relating to a Borrowing, the Administrative Agent
shall advise the affected Lenders of the contents thereof. Each partial
prepayment of any Borrowing shall be in an amount that would be permitted in
the case of an advance of a Borrowing of the same Type as provided in Section
2.02. Each prepayment of a Borrowing shall be applied ratably to the Loans
42
included in the prepaid Borrowing. Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.12.
(c) The amount of any prepayment of the Term Loans made by the Borrower
pursuant to this Section shall be applied to reduce ratably the amount of each
subsequent scheduled repayment of the Term Loans to be made by the Borrower
pursuant to Section 2.09(a).
SECTION 2.11. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender (i) a commitment fee with
respect to its Revolving Commitment (if any), which shall accrue at the
Applicable Rate on the daily amount by which the Revolving Commitment of such
Lender exceeds the Revolving Credit Exposure of such Lender during the period
from and including the Effective Date to but excluding the date on which such
Revolving Commitment terminates; provided that, if such Lender continues to
have any Revolving Credit Exposure after its Revolving Commitment terminates,
then such commitment fee shall continue to accrue on the daily amount of such
Lender's Revolving Credit Exposure from and including the date on which its
Revolving Commitment terminates to but excluding the date on which such Lender
ceases to have any Revolving Credit Exposure and (ii) a commitment fee with
respect to its Term Commitment (if any), which shall accrue at .25% per annum
on the daily amount of the Term Commitment of such Lender during the period
from and including the Effective Date to but excluding the date on which such
Term Commitment terminates. Accrued commitment fees shall be payable in arrears
on the last day of March, June, September and December of each year and on the
date on which the Revolving Commitments terminate, commencing on the first such
date to occur after the date hereof; provided that any commitment fees accruing
with respect to the Revolving Commitments after the date on which the Revolving
Commitments terminate shall be payable on demand. All commitment fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(b) The Borrower agrees to pay (i) to the Administrative Agent for the
account of each Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the Applicable Rate on the average
daily amount of such Lender's LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which
such Lender's Revolving Commitment terminates and the date on which such Lender
ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee,
which shall accrue at the rate of .25% per annum on the average daily amount of
the LC Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date of termination of the Revolving Commitments and
the date on which there ceases to be any LC Exposure, as well as the Issuing
Bank's standard fees with respect to the issuance, amendment, renewal or
extension of any Letter of Credit or processing of drawings thereunder. Accrued
participation fees and fronting fees shall be payable on the last day of March,
June, September and December of each year and on the date on which the
Revolving Commitments terminate, commencing on the first such date to occur
after the date hereof; provided that any such fees accruing after the date on
which the Revolving Commitments terminate shall be payable on demand. Any other
fees payable to the Issuing Bank pursuant to this paragraph shall be payable
within 10 days after demand. All participation fees
43
and fronting fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its own
account, fees payable in the amounts and at the times separately agreed upon
between the Borrower and the Administrative Agent.
(d) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
commitment fees and participation fees, to the relevant Lenders. Fees paid
shall not be refundable under any circumstances.
SECTION 2.12. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b) The Loans comprising each Eurocurrency Borrowing shall bear interest
at the applicable Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Rate.
(c) Notwithstanding the foregoing, if any principal of or interest on any
Loan or any fee or other amount payable by the Borrower hereunder is not paid
when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, the higher
of (x) 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section and (y) 2% plus the rate applicable to ABR
Loans as provided in paragraph (a) of this Section or (ii) in the case of any
other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph
(a) of this Section.
(d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and, in the case of Revolving Loans, upon
termination of the Revolving Commitments; provided that (i) interest accrued
pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in
the event of any repayment or prepayment of any Loan (other than a prepayment
of an ABR Loan prior to the end of the Availability Period), accrued interest
on the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurocurrency Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.
(e) All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate
at times when the Alternate Base Rate is based on the Prime Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and
in each case shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). The applicable Alternate Base Rate
or Adjusted LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.
44
SECTION 2.13. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurocurrency Borrowing:
(a) the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and
reasonable means do not exist for ascertaining the applicable Adjusted
LIBO Rate for such Interest Period;
(b) Lenders having 50% or more of the aggregate principal amount
of the affected Loans advise the Administrative Agent that the
applicable Adjusted LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or
maintaining their Loans for such Interest Period; or
(c) solely if such Borrowing is to be a French Franc Borrowing,
the Administrative Agent determines, or Lenders having 50% or more of
the aggregate principal amount of the affected Loans advise the
Administrative Agent that they have determined, that it is impractical
for such Borrowing to be denominated in French Francs;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurocurrency Borrowing shall be
ineffective, and (ii) if any Borrowing Request requests a Eurocurrency
Borrowing, such Borrowing shall be made as an ABR Borrowing; provided that if
the circumstances giving rise to such notice affect only one Type of
Eurocurrency Borrowings, then the other Type of Eurocurrency Borrowings shall
be permitted.
SECTION 2.14. Increased Costs. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate) or the
Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurocurrency Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurocurrency Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit
or to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts
45
as will compensate such Lender or the Issuing Bank, as the case may be, for
such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender's or the Issuing Bank's capital or on the capital
of such Lender's or the Issuing Bank's holding company, if any, as a
consequence of the Loan Documents or the Loans made by, or participations in
Letters of Credit held by, such Lender, or the Letters of Credit issued by the
Issuing Bank, to a level below that which such Lender or the Issuing Bank or
such Lender's or the Issuing Bank's holding company could have achieved but for
such Change in Law (taking into consideration such Lender's or the Issuing
Bank's policies and the policies of such Lender's or the Issuing Bank's holding
company with respect to capital adequacy), then from time to time the Borrower
will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank
or such Lender's or the Issuing Bank's holding company for any such reduction
suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or
its holding company, as the case may be, as specified in paragraph (a) or (b)
of this Section shall be delivered to the Borrower and shall be conclusive
absent manifest error. The Borrower shall pay such Lender or the Issuing Bank,
as the case may be, the amount shown as due on any such certificate within 10
days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation pursuant to this Section shall not constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender or the Issuing
Bank pursuant to this Section for any increased costs or reductions incurred
more than 180 days prior to the date that such Lender or the Issuing Bank, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 180-day period referred to above shall be extended to include the period of
retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the payment of
any principal of any Eurocurrency Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurocurrency Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.10(b) and is revoked in accordance therewith) or (d) the
assignment of any Eurocurrency Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.18, then, in any such event, the Borrower shall compensate each
Lender for the loss, cost and expense attributable to such event. Such loss,
cost or expense to any Lender shall be deemed to include an amount determined
by such Lender to be the excess, if any, of (i) the amount of interest which
would have accrued on the principal amount of such Loan had such
46
event not occurred, at the applicable Adjusted LIBO Rate that would have been
applicable to such Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for
deposits of a comparable amount and period from other banks in the eurocurrency
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.
SECTION 2.16. Taxes. (a) Any and all payments by or on account of any
obligation of the Borrower under the Loan Documents shall be made free and
clear of and without deduction for any Indemnified Taxes or Other Taxes;
provided that if the Borrower shall be required to deduct any Indemnified Taxes
or Other Taxes from such payments, then (i) the sum payable shall be increased
as necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section) the Administrative
Agent, Lender or Issuing Bank (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made, (ii) the
Borrower shall make such deductions and (iii) the Borrower shall pay the full
amount deducted to the relevant Governmental Authority in accordance with
applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each Lender
and the Issuing Bank, within 10 days after written demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes paid by the Administrative
Agent, such Lender or the Issuing Bank, as the case may be, on or with respect
to any payment by or on account of any obligation of the Borrower hereunder
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. A certificate as to the amount
of such payment or liability delivered to the Borrower by a Lender or the
Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of
a Lender or the Issuing Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy
of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.
(e) Each Foreign Lender shall be entitled to an exemption from
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments made by the Borrower in the United States of
47
America under this Agreement at the time such Foreign Lender becomes a Lender
and shall deliver to the Borrower (with a copy to the Administrative Agent), at
such time and from time to time thereafter, if such exemption is still in
effect, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.14, 2.15 or 2.16, or
otherwise, but other than any payment of principal of and interest on French
Franc Loans (all such non-excluded payments, "Dollar Payments")) prior to 12:00
noon, New York City time, in Dollars, on the date when due, in immediately
available funds, without set-off or counterclaim. The Borrower shall make each
payment required to be made by it hereunder of principal of and interest on
French Franc Loans (all such payments, "French Franc Payments") prior to 12:00
noon, London time, in French Francs, on the date when due, in immediately
available funds, without set-off or counterclaim. Any amounts received after
the required time on any date may, in the discretion of the Administrative
Agent, be deemed to have been received on the next succeeding Business Day for
purposes of calculating interest thereon. All Dollar Payments shall be made to
the Administrative Agent at its New York Office, except payments to be made
directly to the Issuing Bank as expressly provided herein and except that
payments pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly
to the Persons entitled thereto. All French Franc Payments shall be made to the
Administrative Agent at its London Office except payments to be made directly
to the Issuing Bank as expressly provided herein. The Administrative Agent
shall distribute any payments received by it for the account of any other
Person to the appropriate recipient promptly following receipt thereof. If any
payment hereunder shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be payable for
the period of such extension.
(b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be
applied (i) first, towards payment of interest and fees then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, towards payment of
principal and unreimbursed LC Disbursements then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of principal and
unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans of either Class or participations in LC
Disbursements resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loans of such Class and
participations in LC Disbursements and accrued interest thereon than the
proportion received by any other Lender with respect to its Loans or
participations of the relevant Class, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
of the relevant Class and participations in LC Disbursements of other Lenders
to the extent necessary
48
so that the benefit of all such payments shall be shared by the Lenders ratably
in accordance with the aggregate amount of principal of and accrued interest on
their respective Loans of such Class and participations in LC Disbursements;
provided that (i) if any such participations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent of such
recovery, without interest, and (ii) the provisions of this paragraph shall not
be construed to apply to any payment made by the Borrower pursuant to and in
accordance with the express terms of this Agreement or any payment obtained by
a Lender as consideration for the assignment of or sale of a participation in
any of its Loans or participations in LC Disbursements to any assignee or
participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Bank hereunder that the
Borrower will not make such payment, the Administrative Agent may assume that
the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing
Bank, as the case may be, the amount due. In such event, if the Borrower has
not in fact made such payment, then each of the Lenders or the Issuing Bank, as
the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or Issuing Bank
with interest thereon, for each day from and including the date such amount is
distributed to it to but excluding the date of payment to the Administrative
Agent, at the greater of (x) the Federal Funds Effective Rate (if such payment
is a Dollar Payment) or the applicable LIBO Rate (if such payment is a French
Franc Payment) and (y) a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.04(d) or (e), 2.05(b) or 2.17(d), then the Administrative
Agent may, in its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent for the
account of such Lender to satisfy such Lender's obligations under such Sections
until all such unsatisfied obligations are fully paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders. (a) If any
Lender requests compensation under Section 2.14, or if the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 2.16, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder
to another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 2.14 or 2.16, as the case may be, in the future and
(ii) would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender. The Borrower hereby
49
agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.14, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.16,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement
and the other Loan Documents to an assignee that shall assume such obligations
(which assignee may be another Lender, if a Lender accepts such assignment);
provided that (i) the Borrower shall have received the prior written consent of
the Administrative Agent (and, if a Revolving Commitment is being assigned, the
Issuing Bank), which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Disbursements, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder, from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts) and (iii) in the case
of any such assignment resulting from a claim for compensation under Section
2.14 or payments required to be made pursuant to Section 2.16, such assignment
will result in a reduction in such compensation or payments. A Lender shall not
be required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation cease to apply.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01. Organization; Powers. Each of the Borrower and its
Subsidiaries is duly incorporated (or otherwise organized), validly existing
and in good standing under the laws of the jurisdiction of its organization,
has all requisite power and authority to carry on its business as now conducted
and, except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect, is qualified
to do business in, and is in good standing in, every jurisdiction where such
qualification is required.
SECTION 3.02. Authorization; Enforceability. The Transactions are within
each Obligor's corporate powers and have been duly authorized by all necessary
corporate and, if required, stockholder action. Each Loan Document has been
duly executed and delivered by each Obligor party thereto and constitutes a
legal, valid and binding obligation of such Obligor, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law.
50
SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a)
do not require any consent or approval of, registration or filing with, or any
other action by, any Governmental Authority, except such as have been obtained
or made and are in full force and effect, (b) will not violate in any material
respect any applicable law or regulation or the charter, by-laws or other
organizational documents of the Borrower or any of its Subsidiaries or any
order of any Governmental Authority, (c) will not violate or result in a
default under the Indenture (other than as set forth in Schedule 3.03), any
indenture pursuant to which the Refinancing Subordinated Notes are issued, or
any other agreement or other instrument binding upon the Borrower or any of its
Subsidiaries or any of their respective assets other than such violations or
defaults under any such indenture, agreement or other instrument (other than
the Indenture) which, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, and (d) will not result in the
creation or imposition of any Lien on any asset of the Borrower or any of its
Subsidiaries (other than the Liens created by the Collateral Documents).
SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders its consolidated balance sheet
and statements of income, stockholders equity and cash flows as of and for each
of the fiscal years ended February 28, 1995, February 29, 1996 and February 28,
1997, reported on by Ernst & Young LLP, independent public accountants. Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and its
Consolidated Subsidiaries as of such dates and for such periods in accordance
with GAAP.
(b) The Borrower has heretofore furnished to the Lenders the pro forma
balance sheet of the Borrower as of May 31, 1997, certified by one of its
Financial Officers. Such balance sheet presents fairly, in all material
respects, the financial position of the Borrower and its Consolidated
Subsidiaries as of May 31, 1997 in accordance with GAAP on a pro forma basis,
adjusted to give effect (as if such events had occurred on such date) to (i)
the consummation of the Acquisition, (ii) the Transactions contemplated to
occur on the Term Drawdown Date (including without limitation the making of the
Term Loans), (iii) the application of the proceeds therefrom as contemplated by
the Acquisition Documents and the Loan Documents and (iv) the payment of all
legal, accounting and other fees related thereto to the extent known at the
time of the preparation of such balance sheet. As of the date of such balance
sheet and the Effective Date, the Borrower had and has no material liabilities,
contingent or otherwise, including liabilities for taxes, long-term leases or
forward or long-term commitments, which are not properly reflected on such
balance sheet.
(c) Since February 28, 1997, there has been no material adverse change in
the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and its Subsidiaries, taken as a whole.
(d) The pro forma balance sheet delivered by the Borrower pursuant to
Section 4.02(n) presents fairly, in all material respects, the financial
position of the Borrower and its Consolidated Subsidiaries as of the date of
such balance sheet in accordance with GAAP on a pro forma basis, adjusted to
give effect (as if such events had occurred on such date) to (i) the
consummation of the Acquisition, (ii) the Transactions contemplated to occur on
the Term
51
Drawdown Date (including without limitation the making of the Term Loans),
(iii) the application of the proceeds therefrom as contemplated by the
Acquisition Documents and the Loan Documents and (iv) the payment of all legal,
accounting and other fees related thereto to the extent known at the time of
the preparation of such balance sheet. As of the Term Drawdown Date, the
Borrower has no material liabilities, contingent or otherwise, including
liabilities for taxes, long-term leases or forward or long-term commitments,
which are not properly reflected on such balance sheet.
SECTION 3.05. Properties. (a) Each of the Borrower and its Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, except for minor defects in title that do
not interfere with its ability to conduct its business as currently conducted
or to utilize such properties for their intended purposes and subject to
Permitted Encumbrances.
(b) Each of the Borrower and its Subsidiaries owns, or is licensed to use,
all trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Borrower and its
Subsidiaries does not infringe upon the rights of any other Person, except for
any such infringements that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06. Litigation and Environmental Matters. (a) Other than as
set forth on Schedule 3.06, there are no actions, suits or proceedings by or
before any arbitrator or Governmental Authority pending against or, to the
knowledge of the Borrower, threatened against or affecting the Borrower or any
of its Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect or (ii) that involve the Loan Documents, the Transactions, the
Acquisition Documents or the Acquisition.
(b) The Borrower and each of its Subsidiaries have obtained all permits,
certificates, licenses, approvals, registrations and other authorizations which
are required under all applicable Environmental Laws, except to the extent
failure to have any such permit, certificate, license, approval, registration
or authorization would not have a Material Adverse Effect. The Borrower and
each of its Subsidiaries are in compliance with the terms and conditions of all
such permits, certificates, licenses, approvals, registrations and
authorizations, and are 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 notice or demand letter from any regulatory authority issued, entered,
promulgated or approved thereunder, except to the extent failure to comply
would not have a Material Adverse Effect.
(c) In addition, except (x) as described in Schedule 3.06 and (y) to the
extent that the liabilities that would reasonably be expected to result from
the matters referred to in Section 3.06(c) would not exceed $1,000,000
individually or $10,000,000 in the aggregate,
(i) Other than in connection with matters which have been fully
resolved without any liability remaining on the part of the Borrower
or any of its Subsidiaries, no notice, notification, demand, request
for information, citation, summons or order has
52
been issued, no complaint has been filed, no penalty has been assessed
and, to the knowledge of the Borrower, no investigation or review is
pending or threatened by any governmental entity or other Person with
respect to (1) any alleged failure by the Borrower or any of its
Subsidiaries to have any environmental permit, certificate, license,
approval, registration or authorization required in connection with
the conduct of the business of the Borrower or any of its
Subsidiaries, (2) any alleged failure by the Borrower or any of its
Subsidiaries to comply with the terms and conditions of any such
permit, certificate, license, approval, registration or authorization
or of any other limitation, restriction, condition, standard,
prohibition, requirement, obligation, schedule or timetable contained
in any applicable Environmental Law, (3) any Regulated Activity
arising as a result of the operations of the Borrower or any of its
Subsidiaries or at any property now or previously owned, leased or
operated by the Borrower or any of its Subsidiaries or (4) any Release
of any Hazardous Substance arising as a result of the operations of
the Borrower or any of its Subsidiaries or at any property now or
previously owned, leased or operated by the Borrower or any of its
Subsidiaries;
(ii) Neither the Borrower nor its Subsidiaries nor the businesses
conducted by such Persons nor, to the knowledge of the Borrower or any
of its Subsidiaries, any other Person, other than in compliance with
applicable Environmental Laws, has disposed of or placed, held,
located or otherwise handled, any Hazardous Substance on, under or at
any property now or previously owned, operated or leased by the
Borrower or any of its Subsidiaries, and none of such properties has
been used (whether by the Borrower or any of its Subsidiaries or, to
the best knowledge of the Borrower or any of its Subsidiaries, by any
other Person) as a disposal site or storage (whether permanent or
temporary) site for any Hazardous Substance; and
(1) no polychlorinated biphenyls (PCBs), radioactive material,
urea formaldehyde or lead is or has been present at any property
now or previously owned, operated or leased by the Borrower or any
of its Subsidiaries other than in compliance with applicable
Environmental Laws;
(2) no asbestos is or has been present in airborne or friable
form at any property now or previously owned, operated or leased by
the Borrower or any of its Subsidiaries;
(3) there are no underground storage tanks, active or
abandoned in place, which have been used to store or which
otherwise contain or have contained any Hazardous Substance at any
property now or previously owned, operated or leased by the
Borrower or any of its Subsidiaries; and
(4) no Hazardous Substance has been Released in a reportable
quantity, where such a quantity has been established by statute,
ordinance, rule, regulation or order, at, on or under any property
now or previously owned, operated or leased by the Borrower or any
of its Subsidiaries.
53
(iii) None of the Borrower, any of its Subsidiaries, or any of
the businesses conducted by such Persons has transported or arranged
for the transportation of any Hazardous Substance to any location
which is listed or proposed for listing on the National Priorities
List promulgated pursuant to CERCLA ("NPL"), or on any similar
federal, state, foreign or local list or which is the subject of
federal, state, foreign or local enforcement actions or, to the
knowledge of the Borrower, other investigations which may lead to
claims against the Borrower or any of its Subsidiaries for clean-up
costs, remedial work, damages to natural resources or for personal
injury claims, including, but not limited to, claims under CERCLA;
(iv) All oral or written notifications of a Release of a
Hazardous Substance required to be filed under any applicable
Environmental Law have been filed by or on behalf of the Borrower and
its Subsidiaries, and no property now or previously owned, operated or
leased by the Borrower or any of its Subsidiaries is listed or, to the
knowledge of the Borrower or any of its Subsidiaries, proposed for
listing, on the NPL or on the Comprehensive Environmental Response,
Compensation and Liability Information System or any similar federal,
state, foreign or local list of sites requiring investigation or
clean-up which may lead to claims for clean-up costs, remedial work,
damages to natural resources or for personal injury claims, including,
but not limited to, claims under CERCLA;
(v) No Hazardous Substance generated by the Borrower or any of
its Subsidiaries has been stored, recycled, treated or Released,
except in compliance with applicable Environmental Laws, or disposed
of by the Borrower or any of its Subsidiaries at any location;
(vi) There are no Liens arising under or pursuant to any
applicable Environmental Laws on property owned, operated or leased by
the Borrower or any of its Subsidiaries, and, to the knowledge of the
Borrower or any of its Subsidiaries, no actions by any governmental
entity have been taken or are in process which could subject any of
such properties to such Liens, and no notice or restriction relating
to the presence of any Hazardous Substance at any such property is
required to be placed in any deed to such property; and
(vii) There are no existing liabilities or potential liabilities
(excluding expenditures for any period which constitute Consolidated
Capital Expenditures and required to be made to comply with
Environmental Laws that do not arise in connection with a violation of
Environmental Laws or cleanup or remediation of Hazardous Substances)
of the Borrower or any Subsidiary arising out of or relating to
Environmental Laws. The Borrower conducts and has conducted all such
environmental investigations, studies, audits, tests, reviews or other
analyses in relation to all properties and facilities now or
previously owned, operated or leased by the Borrower or any of its
Subsidiaries which are required under applicable Environmental Laws
and maintains such records and reports for the time periods prescribed
under applicable Environmental Laws.
54
(d) For purposes of subsection (c), any representation or warranty given
with respect to the Borrower and its Subsidiaries shall be deemed given also
with respect to any matters which could result in Environmental Liabilities, to
the extent successor liability would be reasonably likely to be imposed under
applicable Environmental Laws on the Borrower or any of its Subsidiaries.
(e) For purposes of subsection (c), any representation or warranty given
with respect to properties or facilities previously owned, leased or operated
by the Borrower or any of its Subsidiaries is only made with respect to
conditions existing or activities occurring during such period of ownership,
leasing or operation and the Borrower makes no representations with respect to
conditions originating after the term of such ownership, leasing or operation.
SECTION 3.07. Compliance with Laws and Agreements. Each of the Borrower
and its Subsidiaries is in compliance with all laws, regulations and orders of
any Governmental Authority applicable to it or its property and all indentures
(including without limitation the Indenture and any indenture pursuant to which
the Refinancing Subordinated Notes are issued), agreements and other
instruments binding upon it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. No Default has occurred and is continuing.
SECTION 3.08. Investment and Holding Company Status. Neither the
Borrower nor any of its Subsidiaries is (a) an "INVESTMENT COMPANY" as defined
in, or subject to regulation under, the Investment Company Act of 1940 or (b) a
"HOLDING COMPANY" as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935.
SECTION 3.09. Taxes. Each of the Borrower and its Subsidiaries has timely
filed or caused to be filed all tax returns and reports required to have been
filed and has paid or caused to be paid all Taxes required to have been paid by
it, except Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary, as applicable, has
set aside on its books adequate reserves.
SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) do not, as of the date of the most recent financial statements
reflecting such amounts, exceed the fair market value of the assets of all such
underfunded Plans by more than $10,000,000.
SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Borrower to
the Administrative Agent or any Lender in connection with the negotiation of
the Loan Documents or delivered thereunder (as modified or supplemented by
other information so furnished) contains any
55
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.12. Guarantors. The Subsidiary Guarantors are all of the
Subsidiaries (other than Foreign Subsidiaries and the Excluded Subsidiaries),
and each Subsidiary Guarantor is a wholly-owned Subsidiary.
SECTION 3.13. Collateral Documents. Each of the representations and
warranties made by the Obligors in the Collateral Documents is true and
correct.
SECTION 3.14. Acquisition Documents. As of the Term Drawdown Date, each
of the representations and warranties made in the Acquisition Documents by each
of the Obligors party thereto is true and correct in all material respects.
SECTION 3.15. Solvency. (a) As of the Effective Date, after giving effect
to the transactions contemplated hereby to occur on the Effective Date: (i)
the aggregate fair market value of the assets of the Borrower and each other
Obligor will exceed its liabilities (including contingent, subordinated,
unmatured and unliquidated liabilities), (ii) the Borrower and each other
Obligor will be able to pay its debts as they mature and (iii) the Borrower and
each other Obligor will not have unreasonably small capital for the business in
which the Borrower and its Subsidiaries are engaged.
(b) As of the Term Drawdown Date, after giving effect to the transactions
contemplated hereby to occur on or before the Term Drawdown Date: (i) the
aggregate fair market value of the assets of the Borrower and each other
Obligor will exceed its liabilities (including contingent, subordinated,
unmatured and unliquidated liabilities), (ii) the Borrower and each other
Obligor will be able to pay its debts as they mature and (iii) the Borrower and
each other Obligor will not have unreasonably small capital for the business in
which the Borrower and its Subsidiaries are engaged.
ARTICLE IV
Conditions
SECTION 4.01. Effective Date. The Effective Date hereunder shall occur
on the first date on which each of the following conditions is satisfied (or
waived in accordance with Section 9.02), it being understood that with respect
to the conditions set forth in clauses (e) and (h), each Lender shall be deemed
to have determined that such conditions shall have been satisfied unless the
Administrative Agent shall have received notice from such Lender prior to the
Effective Date that such Lender does not consider such conditions to have been
satisfied (or, solely with respect to the conditions set forth in clauses (e),
the Lenders shall not have received any documents referred to therein):
56
(a) The Administrative Agent (or its counsel) shall have received
from each party hereto a counterpart of this Agreement signed on
behalf of such party or written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a
signed signature page) that such party has signed a counterpart of
this Agreement may be.
(b) The Administrative Agent (or its counsel) shall have received
(i) from each party to each Collateral Document a counterpart of such
Collateral Document signed on behalf of such party or written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page) that such party has signed a
counterpart of such Collateral Document and (ii) duly executed
financing statements on Form UCC-1 in quantity sufficient for filing
in all jurisdictions in which such filing is necessary or desirable to
perfect the Liens created by the Collateral Documents.
(c) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders
and dated the Effective Date) of Hunton & Xxxxxxxx, counsel for the
Obligors, substantially in the form of Exhibit G, Jones, Walker,
Waechter, Poitevent, Carrere & Xxxxxxx ("Xxxxx Xxxxxx"), Vedder, Price,
Xxxxxxx and Kammholz ("Xxxxxx Price"), Xxxx & Forman, Jones, Waldo,
Xxxxxxxx & XxXxxxxxx, and Spencer, Fane, Xxxxx & Xxxxxx, special real
estate counsel for the Obligors, in the case of Xxxxx Xxxxxx and Xxxxxx
Price, and for the Administrative Agent, in the case of the others,
each substantially in the form of Exhibit H, with such changes as are
acceptable to the Administrative Agent, and of Xxxxx Xxxx & Xxxxxxxx,
special counsel for the Administrative Agent, substantially in the form
of Exhibit I, and each covering such other matters relating to the
Obligors, the Loan Documents or the Transactions as the Required
Lenders shall reasonably request. The Borrower hereby requests each of
Hunton & Xxxxxxxx, Xxxxx Xxxxxx and Xxxxxx Price to deliver such
opinion.
(d) The Lenders shall have received all the financial statements
referred to in Sections 3.04(a) and 3.04(b).
(e) The Lenders shall have received (i) an appraisal of the fixed
assets of the Borrower and its Subsidiaries conducted by Valuation
Research Corporation, (ii) an audit of the accounts receivable and
inventory of the Borrower and its Subsidiaries conducted by The Chase
Manhattan Bank and (iii) an environmental report prepared by Pilko &
Associates, in each case in form and substance reasonably satisfactory
to the Lenders.
(f) Subject to Section 5.11, the Administrative Agent shall have
received, with respect to each property listed on Schedule 4.01(f),
(x) an ALTA extended coverage lender's policy of title insurance in an
aggregate amount at least equal to the amount set forth in Schedule
4.01(f) insuring the Mortgage of such property as a valid, enforceable
first Lien on the Borrower's interest in such property as defined in
and subject to such Mortgage (or "marked-up" title commitment for such
policy dated
57
effective as of the date of such Mortgage) subject only to Permitted
Encumbrances and to such other exceptions as are satisfactory to the
Administrative Agent, (y) for each policy referred to in clause (x), a
title commitment for such policy together with legible copies of all
documents affecting title, which shall show all recording information
and (z) a survey with respect to such property in form and substance
satisfactory to Chicago Title Insurance Company and the Administrative
Agent. Each policy delivered by the Borrower pursuant to clause (x),
including each of the exceptions to coverage contained therein, shall
be subject to the approval of the Administrative Agent, and shall be
issued by Chicago Title Insurance Company. Attached to each such policy
shall be any and all endorsements reasonably required by the
Administrative Agent and available in the state in which such property
is located, including (i) a comprehensive endorsement (ALTA 9 or
equivalent) covering restrictions and other matters, (ii) a 3.1 form of
zoning endorsement, (iii) an endorsement ensuring that the Lien of the
Mortgage with respect to which the policy is issued is valid against
any applicable usury laws in the state in which the Property subject to
such Mortgage is located, (iv) an endorsement ensuring that such
Property has access to a dedicated public street, (v) a revolving
credit endorsement, (vi) a contiguity endorsement, (vii) a survey and
"same as" endorsement, (viii) an endorsement deleting the so-called
"doing business" exclusion and (ix) a "tie-in" endorsement. In
addition, the Administrative Agent shall have received a certificate of
a Financial Officer listing all real property owned or leased by the
Borrower and its Subsidiaries.
(g) The Administrative Agent shall have received insurance
letters setting forth and opining as to the reasonableness of the
insurance programs maintained (i) with respect to the Borrower and its
Subsidiaries and (ii) with respect to any joint venture to which the
Borrower or any of its Subsidiaries are a party, all in form and
substance, and from Persons, reasonably satisfactory to the
Administrative Agent.
(h) In the judgment of the Lenders, there shall be no actions,
suits or proceedings by or before any arbitrator or Governmental
Authority pending against or threatened against or affecting the
Borrower or any of its Subsidiaries (i) as to which there is a
reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect or (ii) that
involve the Loan Documents or the Transactions.
(i) The Administrative Agent shall have received evidence
satisfactory to it that all outstanding obligations of the Borrower
and its Subsidiaries under the agreements and instruments set forth on
Schedule 4.01 (including without limitation principal and interest
with respect to any loans and all accrued fees and expenses), which
obligations shall not exceed $36,000,000 in amount, shall have been
paid in full or otherwise discharged, all commitments thereunder shall
have been terminated and all Liens securing such obligations and all
Guarantees thereof shall have been released (or arrangements
satisfactory to the Administrative Agent to effect the foregoing shall
have been made).
58
(j) All consents, approvals, registrations, or other actions to
be obtained, made or taken in connection with the consummation of the
Transactions to be consummated on the Effective Date shall have been
obtained, made or taken and shall be in full force and effect.
(k) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Effective Date,
including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses required to be reimbursed or paid by the
Borrower hereunder.
(l) The Administrative Agent shall have received such documents
and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence, good
standing and solvency of each Obligor, the authorization of the
Transactions and any other legal matters relating to any of the
foregoing, all in form and substance satisfactory to the
Administrative Agent and its counsel.
The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Revolving
Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or
waived pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time,
on August 29, 1997 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 4.02. Term Drawdown Date. The obligation of each Lender to make
a Term Loan on the Term Drawdown Date is subject to the satisfaction of the
following conditions (or waiver thereof in accordance with Section 9.02), it
being understood that with respect to the conditions set forth in clauses (b),
(i), (m), (n) and (o), each Lender shall be deemed to have determined that such
conditions shall have been satisfied unless the Administrative Agent shall have
received notice from such Lender prior to the Term Drawdown Date that such
Lender does not consider such conditions to have been satisfied (or, solely
with respect to the conditions set forth in clauses (b), (m), (n) and (o), the
Lenders shall not have received any documents referred to therein):
(a) The Administrative Agent (or its counsel) shall have
received (i) from each party to the Borrower Pledge Agreement, a
counterpart of the Borrower Pledge Agreement signed on behalf of such
party, (ii) any promissory notes comprising the Collateral (including
promissory notes from any Excluded Subsidiary to the Borrower) and
(iii) any stock certificates (with stock powers duly executed in
blank) comprising the Collateral.
(b) The structure of the Acquisition, the corporate, capital and
asset structure of the Borrower and its Subsidiaries and JVC after
giving effect thereto (including without limitation the ownership by
JVC of the Business), the shareholder and other arrangements with
respect to the capital stock of JVC and the management and
59
operations of JVC, the Acquisition Documents and the Put/Call
Arrangements shall each be in form and substance reasonably
satisfactory to the Lenders.
(c) (i) The aggregate amount of funds required by the Borrower
with respect to the Acquisition (including without limitation for the
payment of fees, commissions and expenses) shall not exceed
$40,000,000 and (ii) the sources and uses of such funds (and the
assumptions relating thereto) shall be as agreed upon between the
Borrower and the Lenders prior to the Term Drawdown Date.
(d) The Acquisition Documents shall be in full force and
effect, and all consents, approvals, registrations, or other actions to
be obtained, made or taken in connection with the consummation of the
Acquisition and the Transactions to be consummated on the Term Drawdown
Date (including without limitation any consents or approvals to be
obtained from the board of directors of the Borrower, the shareholders
of the Borrower and any consents, approvals, registrations or other
actions to be obtained from, made with or taken by any Governmental
Authority) shall have been obtained, made or taken and shall be in full
force and effect.
(e) The Administrative Agent shall have received evidence
satisfactory to it, which may include a certificate of the Borrower,
that (i) all conditions to the consummation of the transactions
contemplated by the Acquisition Documents to be consummated on the
Term Drawdown Date as set forth in the Acquisition Documents (the
"Phase I Transactions") shall have been satisfied (without waiver of
any material condition, unless such waiver is approved by the Required
Lenders), (ii) all Phase I Transactions will take place prior to or
simultaneously with the transactions contemplated hereby to take place
on the Term Drawdown Date (including without limitation the making of
the Term Loans) and (iii) the consummation of all such transactions
and all transactions contemplated hereby to take place on the Term
Drawdown Date shall not violate any applicable law or regulation
(including without limitation any of the Regulations of the Board,
including Regulations G, U and X).
(f) The Administrative Agent shall have received (i) evidence
satisfactory to it that the Liens created by the Collateral Documents
constitute perfected first priority Liens on the Collateral (other
than on Collateral consisting of Rolling Stock, Rolling Stock Leases
and Leased Rolling Stock (in each case as defined in the Security
Agreements)) and the rights and claims of the Borrower under the
Acquisition Documents (other than the Stock Purchase Agreement and the
Put/Call Agreement), to the extent required by the Collateral
Documents and (ii) the written consent of Xxxxx-Xxxxxxx Chimie to the
assignment by the Borrower of its rights and claims under the Stock
Purchase Agreement and the Put/Call Agreement as collateral under the
Borrower Security Agreement.
(g) The Refinancing Date shall have occurred.
(h) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders
and dated the Term
60
Drawdown Date) of Hunton & Xxxxxxxx, counsel for the Obligors, and of
C.L. & A, French counsel for the Borrower, each in form and substance
reasonably satisfactory to the Administrative Agent. The Borrower
hereby requests each of Hunton & Xxxxxxxx and X.X. & A to deliver such
opinion.
(i) In the judgment of the Lenders, there shall be no actions,
suits or proceedings by or before any arbitrator or Governmental
Authority pending against or threatened against or affecting the
Borrower or any of its Subsidiaries (i) as to which there is a
reasonable possibility of an adverse determination and that, if
adversely determined, could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect or (ii) that
involve the Loan Documents, the Transactions the Acquisition Documents
or the Acquisition.
(j) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Term Drawdown Date,
including, to the extent invoiced, reimbursement or payment of all
out-of-pocket expenses required to be reimbursed or paid by the
Borrower hereunder.
(k) The Administrative Agent shall have received a certificate,
dated the Term Drawdown Date and signed by the President, a Vice
President or a Financial Officer of the Borrower, confirming
compliance with the conditions set forth in paragraphs (a), (b) and
(c) of Section 4.03.
(l) The Administrative Agent shall have received insurance
letters setting forth and opining as to the reasonableness of the
insurance programs maintained with respect to the Business in form and
substance, and from a Person, reasonably satisfactory to the
Administrative Agent.
(m) The Lenders shall have received a baseline environmental
investigation report relating to the Business in form and substance
reasonably satisfactory to the Lenders.
(n) The Lenders shall have received audited financial statements
for the Business as a stand-alone entity for the fiscal year ended
December 31, 1996 and reviewed financial statements for the Business
as a stand-alone entity for the three months ended March 31, 1997 and
the six months ended June 30, 1997 in form and substance reasonably
satisfactory to the Lenders.
(o) The Lenders shall have received the pro forma balance sheet
of the Borrower as of a date no earlier than May 31, 1997, certified
by one of its Financial Officers and prepared in accordance with GAAP
on a pro forma basis, adjusted to give effect (as if such events had
occurred on the date of such balance sheet) to (i) the consummation of
the Acquisition, (ii) the Transactions contemplated to occur on the
Term Drawdown Date (including without limitation the making of the
Term Loans), (iii) the application of the proceeds therefrom as
contemplated by the Acquisition Documents and the Loan Documents and
(iv) the payment of all legal, accounting and other fees related
thereto to the extent known at the time of the preparation of such
61
balance sheet, and such pro forma balance sheet shall be in form and
substance reasonably satisfactory to the Lenders.
(p) The Administrative Agent shall have received such documents
and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence, good
standing and solvency of each Obligor, the authorization of the
Transactions, the Acquisition, the Acquisition Documents, the Put/Call
Arrangements and any other legal matters relating to any of the
foregoing, all in form and substance satisfactory to the
Administrative Agent and its counsel.
The Administrative Agent shall notify the Borrower and the Lenders of the
Term Drawdown Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Term
Loans shall not become effective unless each of the foregoing conditions is
satisfied (or waived pursuant to Section 9.02) at or prior to 3:00 p.m., New
York City time, on January 1, 1998 (and, in the event such conditions are not
so satisfied or waived, the Term Commitments shall terminate at such time, if
not previously terminated pursuant to Section 2.07 or 4.01).
SECTION 4.03. Each Credit Event. The obligation of each Lender to make a
Loan on the occasion of any Borrowing (including without limitation any Term
Borrowing on the Term Drawdown Date), and of the Issuing Bank to issue, amend,
renew or extend any Letter of Credit, is subject to the satisfaction of the
following conditions:
(a) The Effective Date shall have occurred.
(b) The representations and warranties of the Obligors set forth
in the Loan Documents shall be true and correct on and as of the date
of such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, except that (i) the
representations and warranties set forth in Section 3.06(a) of this
Agreement regarding any action, suit or proceeding which involves the
Acquisition Documents or the Acquisition are made on and as of any
such date only if such date occurs on or after the Term Drawdown Date,
(ii) the representations and warranties set forth in Sections 3.04(d),
3.14 and 3.15(b) of this Agreement are made on and as of the Term
Drawdown Date only and (iii) the representations and warranties set
forth in Section 3.15(a) of this Agreement are made on and as of the
Effective Date only.
(c) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such
Letter of Credit, as applicable, no Default shall have occurred and be
continuing.
(d) Solely if such Borrowing is to be made, or such Letter of
Credit is to be issued, amended, renewed or extended on any date prior
to the Refinancing Date, immediately after giving effect to such
Borrowing or such issuance, amendment, renewal or extension, as the
case may be, the aggregate Revolving Credit Exposure does not exceed
$40,000,000.
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Each Borrowing and each issuance, amendment, renewal or extension of a
Letter of Credit shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (b),
(c) and (d) of this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal of
and interest on each Loan and all fees and other amounts payable hereunder
shall have been paid in full and all Letters of Credit shall have expired or
terminated and all LC Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:
SECTION 5.01. Financial Statements and Other Information. The Borrower
will furnish to the Administrative Agent:
(a) within 95 days after the end of each fiscal year of the
Borrower, its audited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows as of
the end of and for such year, setting forth in each case in
comparative form the figures for the previous fiscal year, all
reported on by Ernst & Young LLP or other independent public
accountants of recognized national standing (without a "GOING CONCERN"
or like qualification or exception and without any qualification or
exception as to the scope of such audit) to the effect that such
consolidated financial statements present fairly in all material
respects the financial condition and results of operations of the
Borrower and its Consolidated Subsidiaries on a consolidated basis in
accordance with GAAP;
(b) within 50 days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower, its consolidated
balance sheet and related statements of operations, stockholders'
equity and cash flows as of the end of and for such fiscal quarter and
the then elapsed portion of the fiscal year, setting forth in each
case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of)
the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and its
Consolidated Subsidiaries on a consolidated basis in accordance with
GAAP, subject to normal year-end audit adjustments and the absence of
notes;
(c) within 30 days after the end of each calendar month of each
fiscal year of the Borrower (other than the third month of each fiscal
quarter), its consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows as of the end of and
for such month and the then elapsed portion of the fiscal year,
setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance
sheet, as of the end of) the previous fiscal
63
year, all certified by one of its Financial Officers as presenting
fairly in all material respects the financial condition and results of
operations of the Borrower and its Consolidated Subsidiaries on a
consolidated basis in accordance with GAAP, subject to normal year-end
audit adjustments and the absence of notes;
(d) within 95 days after the end of each fiscal year of JVC, its
audited consolidated balance sheet and related statements of
operations, stockholders' equity and cash flows as of the end of and
for such year, setting forth in each case in comparative form the
figures for the previous fiscal year, all reported on by Ernst & Young
LLP or other independent public accountants of recognized national
standing (without a "GOING CONCERN" or like qualification or exception
and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements
present fairly in all material respects the financial condition and
results of operations of JVC and its Consolidated Subsidiaries on a
consolidated basis in accordance with GAAP;
(e) within 50 days after the end of each of the first three
fiscal quarters of each fiscal year of JVC, its consolidated balance
sheet and related statements of operations, stockholders' equity and
cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods
of (or, in the case of the balance sheet, as of the end of) the
previous fiscal year; provided that, solely with respect to fiscal
quarters of JVC ended prior to the Term Drawdown Date, the Borrower
shall be required to deliver such financial statements only to the
extent such financial statements are available to the Borrower;
(f) concurrently with any delivery of financial statements under
clause (a) and (b) above, a certificate of a Financial Officer (i)
certifying as to whether a Default has occurred and, if a Default has
occurred, specifying the details thereof and any action taken or
proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with
Sections 6.01 and Section 6.11 through 6.14, inclusive, (iii) setting
forth the Leverage Ratio at the last day of the fiscal quarter or
fiscal year, as the case may be, with respect to which such financial
statements relate and a reasonably detailed calculation of such
Leverage Ratio and (iv) stating whether any change in GAAP or in the
application thereof has occurred since the date of the audited
financial statements for the 1997 fiscal year referred to in Section
3.04 (but each such change need only be reported once) and, if any
such change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate;
(g) concurrently with any delivery of financial statements under
clause (a) above, a certificate of the accounting firm that reported
on such financial statements stating whether they obtained knowledge
during the course of their examination of such financial statements of
any Default (which certificate may be limited to the extent required
by accounting rules or guidelines);
64
(h) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials
filed by the Borrower or any Subsidiary with the Securities and
Exchange Commission, or any Governmental Authority succeeding to any
or all of the functions of said Commission, or with any national
securities exchange, as the case may be;
(i) prior to the end of each fiscal year of the Borrower, copies
of operating plans and financial forecasts for the next fiscal year
and any succeeding fiscal years, as prepared from time to time by the
management of the Borrower for internal use;
(j) promptly upon receipt or delivery thereof, as the case may
be, copies of any notice or request delivered in connection with the
Put/Call Arrangements;
(k) promptly following the delivery thereof to the Borrower or
its board of directors or management, a copy of any management letter
or written report by independent public accountants with respect to
the policies and procedures of the Borrower and its Subsidiaries that
notes a "reportable condition"; and
(l) promptly following any request therefor, such other
information regarding the operations, business affairs and financial
condition of the Borrower or any Subsidiary, or JVC or the Business,
or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender acting through the Administrative
Agent may reasonably request.
SECTION 5.02. Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding
by or before any arbitrator or Governmental Authority against or
affecting the Borrower or any Affiliate thereof that, if adversely
determined, could reasonably be expected to result in a Material
Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together
with any other ERISA Events that have occurred, could reasonably be
expected to result in liability of the Borrower and its Subsidiaries
in an aggregate amount exceeding $1,000,000; and
(d) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a
statement of a Financial Officer or other executive officer of the Borrower
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.
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SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
6.03(a) or any Asset Sale permitted under Section 6.03(c).
SECTION 5.04. Payment of Obligations. The Borrower will, and will cause
each of its Subsidiaries to, pay its obligations, including liabilities for
Taxes, that, if not paid, could result in a Material Adverse Effect before the
same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b)
the Borrower or such Subsidiary has set aside on its books adequate reserves
with respect thereto in accordance with GAAP and (c) the failure to make
payment pending such contest could not reasonably be expected to result in a
Material Adverse Effect.
SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will,
and will cause each of its Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
(including without limitation comprehensive general liability insurance,
workers compensation insurance, product liability insurance, business
interruption insurance and environmental insurance) as are customarily
maintained by companies engaged in the same or similar businesses operating in
the same or similar location.
SECTION 5.06. Books and Records; Inspection Rights. The Borrower will,
and will cause each of its Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each of its Subsidiaries to, permit any representatives designated
by the Administrative Agent or any Lender, upon reasonable prior notice, to
visit and inspect its properties, to examine and make extracts from its books
and records, and to discuss its affairs, finances and condition with its
officers and independent accountants, all at such reasonable times and as often
as reasonably requested.
SECTION 5.07. Compliance with Laws. (a) The Borrower will, and will
cause each of its Subsidiaries to, comply with all laws, rules, regulations and
orders of any Governmental Authority (including, without limitation, ERISA)
applicable to it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
(b) The Borrower will, and will cause each of its Subsidiaries to, comply
with all material provisions of all material contracts to which the Borrower or
such Subsidiary, as the case may be, is a party.
SECTION 5.08. Use of Proceeds and Letters of Credit. The proceeds of the
Revolving Loans made on the Effective Date will be used only to refinance the
Indebtedness set forth on Schedule 4.01 and to pay related fees and expenses,
including such amounts payable hereunder.
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The proceeds of the Term Loans and the Revolving Loans made on the Term Drawdown
Date will be used only (i) to consummate the Acquisition, (ii) to pay related
fees and expenses and (iii) to repay outstanding Revolving Loans (it being
understood that nothing in this clause (iii) shall be construed to require the
Borrower to repay such Loans). The proceeds of the Revolving Loans made on any
date (other than the Effective Date or the Term Drawdown Date) will be used only
(i) to finance Consolidated Capital Expenditures and Permitted Acquisitions
permitted hereunder, (ii) to finance the purchase by the Borrower of the capital
stock of JVC pursuant to the Put/Call Arrangements and (iii) for working capital
purposes (including without limitation the making of intercompany loans to
Subsidiaries, the proceeds of which loans will be used by such Subsidiaries for
working capital purposes). No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that entails a violation of any
of the Regulations of the Board, including Regulations G, U and X. Letters of
Credit will be issued only to support obligations of the Borrower and its
Subsidiaries incurred in the ordinary course of business and will not be used,
whether directly or indirectly, for any purpose that entails a violation of any
of the Regulations of the Board, including Regulations G, U and X.
SECTION 5.09. Further Assurances. (a) The Borrower will, and will cause
each Subsidiary to, at the Borrower's sole cost and expense, do, execute,
acknowledge and deliver all such further acts, deeds, conveyances, mortgages,
assignments, notices of assignment and transfers as the Administrative Agent
shall from time to time reasonably request, which may be necessary or desirable
(in the reasonable judgment of the Administrative Agent or the Required
Lenders) from time to time to assure, perfect, convey, assign and transfer to
the Administrative Agent the property and rights conveyed or assigned pursuant
to the Collateral Documents.
(b) The Borrower will:
(i) cause each Person which becomes a Subsidiary (other than a
Foreign Subsidiary or an Excluded Subsidiary) after the Effective Date
and each Person (other than a Foreign Subsidiary) which ceases to be
an Excluded Subsidiary to (x) become a party to the Subsidiary
Guarantee as guarantor by executing the Subsidiary Guarantee or a
supplement thereof in form and substance satisfactory to the
Administrative Agent and (y) enter into a security agreement and any
other agreements, each in form and substance satisfactory to the
Administrative Agent, as may be necessary or desirable in order to
grant perfected first priority security interests upon all of its
assets to secure its obligations under the Subsidiary Guarantee; and
(ii) pledge, or cause to be pledged, pursuant to the Borrower
Pledge Agreement (or another pledge agreement in form and substance
satisfactory to the Administrative Agent) (x) all of the capital stock
or other equity interests owned directly or indirectly by the Borrower
of (A) any Person described in clause (i) above or (B) any joint
venture in which the Borrower or any Subsidiary has an ownership
interest (other than the Avondale joint venture with Cytec Industries
Inc. and the JVC), and (y) such amount of capital stock or other
equity interests of each Person (other than any Excluded Subsidiary)
which is or becomes a Foreign Subsidiary after the Effective Date as
shall be necessary so that at all times at least 66% of the capital
stock or other
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equity interests of each such Person shall be pledged pursuant to the
Borrower Pledge Agreement or such other pledge agreement.
The Borrower shall cause each Person described in clauses (i) or (ii)
above to take such actions as may be necessary or desirable to effect the
foregoing within 30 days after such Person becomes a Subsidiary (or ceases to
be an Excluded Subsidiary), including without limitation causing such Person to
(1) execute and deliver to the Administrative Agent such number of copies as
the Administrative Agent may specify of such supplements and security agreement
and other documents creating security interests and (2) deliver such
certificates, evidences of corporate action or other documents as the
Administrative Agent may reasonably request, all in form and substance
satisfactory to the Administrative Agent, relating to the satisfaction of the
Borrower's obligations under this Section.
(c) The Borrower will use reasonable efforts to secure any consents
required to permit it to pledge or grant a security interest in all of its
interest in (x) Crilar Alumina Company L.L.C., a Delaware limited liability
company, and its successors and (y) Sugar Creek River Terminal, L.L.C., a
Missouri limited liability company, and its successors. The Borrower will
promptly notify the Administrative Agent after such consent is received.
SECTION 5.10. Landlord and Warehouseman Waivers. The Borrower shall use
all reasonable efforts to deliver to the Administrative Agent waivers of
contractual and statutory landlord's, landlord's mortgagee's and warehouseman's
Liens in form and substance satisfactory to the Administrative Agent under each
existing lease, warehouse agreement or similar agreement to which the Borrower
or any Subsidiary is a party; provided that unless the Administrative Agent
agrees otherwise, such waivers will in any event be incorporated when the
existing lease, warehouse agreement or similar agreement is amended, renewed or
extended and the Borrower will use all reasonable efforts to obtain waivers of
both contractual and statutory landlord's, landlord's mortgagee's and
warehouseman's Liens in form and substance satisfactory to the Administrative
Agent in connection with each new lease, warehouse agreement or similar
agreement entered into by the Borrower or any Subsidiary.
SECTION 5.11. Post-Closing Title Matters. As soon as practicable after
the Effective Date but not later than November 30, 1997, the Borrower shall
deliver or cause to be delivered to the Administrative Agent, with respect to
each of the (a) Borrower's properties located in Seneca, Illinois and Crystal
City, Missouri, (i) a survey with respect to such property, in form and
substance satisfactory to Chicago Title Insurance Company and the Administrative
Agent, and (ii) endorsements to the ALTA extended coverage lender's policy of
title insurance relating to the Mortgage of such property delivered on the
Effective Date to the Administrative Agent, including (A) a comprehensive
endorsement (ALTA 9 or equivalent) covering restrictions and other matters, (B)
a 3.1 form of zoning endorsement, (C) an endorsement ensuring that such property
has access to a dedicated public street, (D) a contiguity endorsement, if
applicable, and (E) a survey and "same as" endorsement, in each case in form and
substance reasonably satisfactory to the Administrative Agent, and (b) the
Borrower's property located in Gramercy, Louisiana, an endorsement or final ALTA
loan policy which modifies, in the manner contemplated by the marked-up title
commitment delivered to the Administrative Agent on the Effective Date,
exceptions 3 and 4 of Schedule B, Section II of such title commitment. As soon
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as practicable after the Effective Date but not later than February 28, 1998,
the Borrower shall deliver or cause to be delivered to the Administrative
Agent, with respect to the Borrower's property located in Baton Rouge,
Louisiana, a Non-Disturbance Agreement executed by Crilar Alumina Company
L.L.C. ("Crilar") in the form attached as Exhibit "B" to that certain Surface
Lease dated September 1, 1995 between the Borrower, as lessor, and Crilar, as
lessee..
SECTION 5.12. Gas Hedging Program. The Borrower will maintain, and will
cause its Subsidiaries to maintain, a gas hedging program at such times and on
such terms as the Borrower, in its business judgment, shall consider
appropriate.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees and other amounts payable hereunder have
been paid in full and all Letters of Credit have expired or terminated and all
LC Disbursements shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:
SECTION 6.01. Indebtedness. (a) The Borrower will not, and will not permit
any Subsidiary to, create, incur, assume or permit to exist any Indebtedness,
except:
(i) Indebtedness created hereunder;
(ii) (x) Indebtedness evidenced by the Senior Subordinated
Notes and (y) at any time on or after the Refinancing Date,
Indebtedness evidenced by the Refinancing Subordinated Notes;
(iii) (x) Indebtedness existing on the date hereof and set
forth in Schedule 6.01 and (y) any Indebtedness ("Refinancing
Indebtedness") constituting an extension, renewal or replacement of any
Indebtedness permitted by clause (x) ("Refinanced Indebtedness");
provided that (1) the aggregate principal amount of any Refinancing
Indebtedness shall not exceed the aggregate principal amount of the
relevant Refinanced Indebtedness plus any fees and expenses reasonably
incurred in connection with the refinancing of such Refinanced
Indebtedness and (2) the material terms of any Refinancing Indebtedness
(including without limitation interest rate and tenor) shall be at
least as favorable to the obligors thereunder as the material terms of
the relevant Refinanced Indebtedness;
(iv) (x) Indebtedness of the Borrower to any Subsidiary
and of any Subsidiary (other than a Foreign Subsidiary) to the Borrower
or any other Subsidiary, in each case to the extent permitted by
Section 6.04; provided that any Indebtedness permitted by this clause
(x) and owed to the Borrower shall be evidenced by a
69
promissory note subject to a perfected first priority Lien in favor of
the Administrative Agent and (y) the Intercompany Acquisition Loan;
(v) Guarantees by the Borrower of Indebtedness of any
Subsidiary (other than a Foreign Subsidiary) and by any Subsidiary of
Indebtedness of the Borrower or any other Subsidiary (other than a
Foreign Subsidiary), in each case to the extent permitted by Section
6.04;
(vi) Employee Loan Guarantees with respect to loans in an
aggregate principal amount not to exceed $5,000,000;
(vii) the Turbine Lease Guarantee;
(viii) solely on any date on or after the Term Drawdown
Date, the Regulatory Guarantees;
(ix) Indebtedness under any Hedging Agreements permitted
under Section 6.05;
(x) Indebtedness of the Borrower or any Subsidiary
incurred after the Effective Date to finance the acquisition,
construction or improvement of any fixed or capital assets, including
Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any
such assets prior to the acquisition thereof, and extensions, renewals
and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof; provided that (x) such
Indebtedness is incurred prior to or within 90 days after such
acquisition or the completion of such construction or improvement and
(y) the aggregate principal amount of Indebtedness permitted by this
clause (x) shall not exceed $3,000,000 at any time outstanding;
(xi) Indebtedness of any Person (other than JVC) that
becomes a Subsidiary after the date hereof; provided that (x) such
Indebtedness exists at the time such Person becomes a Subsidiary and is
not created in contemplation of or in connection with such Person
becoming a Subsidiary and (y) the aggregate principal amount of
Indebtedness permitted by this clause (xi) shall not exceed $10,000,000
at any time outstanding;
(xii) at any time from and after the time JVC is a
Subsidiary, (x) the Intercompany Acquisition Loan and (y) other
Indebtedness of JVC not permitted by any of the foregoing clauses in an
aggregate principal Dollar Amount not to exceed $30,000,000 at any time
outstanding; provided that any such Indebtedness outstanding at the
time JVC becomes a Subsidiary shall be permitted pursuant to this
clause (xii) only if the Borrower is in compliance with Sections 6.12,
6.13 and 6.14 after adjustments similar to those described in clause
(y) of the proviso to the definition of "Permitted Acquisition" have
been made, as though such date were the date of consummation of an
acquisition; and
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(xiii) other unsecured Indebtedness (other than, at any time
from and after JVC is a Subsidiary, Indebtedness of JVC) in an
aggregate principal amount not exceeding $3,000,000 at any time
outstanding.
(b) At any time prior to the time JVC is a Subsidiary, the Borrower will
not permit JVC to create, incur, assume or permit to exist any Indebtedness,
except:
(i) Indebtedness incurred to finance the acquisition,
construction or improvement of any fixed or capital assets, including
Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any
such assets prior to the acquisition thereof, and extensions, renewals
and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof; provided that such Indebtedness
is incurred prior to or within 90 days after such acquisition or the
completion of such construction or improvement; and
(ii) other Indebtedness (other than (x) the Intercompany
Acquisition Loan and (y) the term loan made by Xxxxx-Xxxxxxx to JVC on
the Term Drawdown Date in a principal amount not in excess of
$27,000,000 minus the principal amount of the Intercompany Acquisition
Loan on the Term Drawdown Date); provided that the aggregate principal
amount of Indebtedness permitted by clauses (i) and (ii) of this
paragraph (b) shall not exceed $30,000,000 at any time outstanding.
SECTION 6.02. Liens. (a) The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any
income or revenues (including accounts receivable) or rights in respect of any
thereof, except:
(i) Permitted Encumbrances;
(ii) (x) any Lien on any property or asset of the Borrower
or any Subsidiary set forth in Schedule 6.02; provided that (1) such
Lien shall not apply to any other property or asset of the Borrower or
any Subsidiary and (2) such Lien shall secure only those obligations
which it secures on the date hereof or, solely with respect to any Lien
securing Indebtedness permitted under Section 6.01(iii)(x), such
Indebtedness and any extensions, renewals or replacements of such
Indebtedness permitted under Section 6.01(iii)(y);
(iii) any Lien securing Indebtedness permitted pursuant to
Section 6.01 existing on any property or asset prior to the acquisition
thereof by the Borrower or any Subsidiary or existing on any property
or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (x)
such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be,
(y) such Lien shall not apply to any other property or assets of the
Borrower or any Subsidiary and (z) such Lien shall secure only those
obligations which it secures on the date of
71
such acquisition or the date such Person becomes a Subsidiary, as the
case may be; and
(iv) Liens on fixed or capital assets acquired,
constructed or improved by the Borrower or any Subsidiary; provided
that (w) such security interests secure Indebtedness permitted by
clause (x) of Section 6.01(a), (x) such security interests and the
Indebtedness secured thereby are incurred prior to or within 90 days
after such acquisition or the completion of such construction or
improvement, (y) the Indebtedness secured thereby does not exceed 100%
of the cost of acquiring, constructing or improving such fixed or
capital assets and (z) such security interests shall not apply to any
other property or assets of the Borrower or any Subsidiary.
(b) At any time prior to the time JVC is a Subsidiary, the Borrower will
not permit JVC to create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any
income or revenues (including accounts receivable) or rights in respect of any
thereof, except:
(i) any Lien securing Indebtedness permitted pursuant to
Section 6.01 existing on any property or asset prior to the acquisition
thereof by JVC; provided that (x) such Lien is not created in
contemplation of or in connection with such acquisition, (y) such Lien
shall not apply to any other property or assets of JVC and (z) such
Lien shall secure only those obligations which it secures on the date
of such acquisition;
(ii) Liens on fixed or capital assets acquired,
constructed or improved by JVC; provided that (w) such security
interests secure Indebtedness permitted by clause (i) of Section
6.01(b), (x) such security interests and the Indebtedness secured
thereby are incurred prior to or within 90 days after such acquisition
or the completion of such construction or improvement, (y) the
Indebtedness secured thereby does not exceed 90% of the cost of
acquiring, constructing or improving such fixed or capital assets and
(z) such security interests shall not apply to any other property or
assets of JVC and
(iii) Liens securing Indebtedness permitted by clause (ii)
of Section 6.01(b).
SECTION 6.03. Fundamental Changes; Asset Sales. (a) The Borrower will
not, and will not permit any Subsidiary to, merge into or consolidate with any
other Person, or permit any other Person to merge into or consolidate with it,
or sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all of its assets, or all or
substantially all of the stock of any of its Subsidiaries (in each case,
whether now owned or hereafter acquired), or liquidate or dissolve, except
that, if at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing, (i) any Subsidiary may merge
into the Borrower in a transaction in which the Borrower is the surviving
corporation, (ii) any Subsidiary may merge into any Subsidiary in a transaction
in which the surviving entity is a Subsidiary Guarantor and (iii) any
Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the
Borrower or to a Subsidiary Guarantor; provided that any such merger
72
involving a Person that is not a wholly owned Subsidiary immediately prior to
such merger shall not be permitted unless also permitted by Section 6.04.
(b) The Borrower will not, and will not permit any of its Subsidiaries to,
engage to any material extent in any business other than businesses of the type
conducted by the Borrower and its Subsidiaries on the date of execution of this
Agreement and businesses reasonably related thereto.
(c) The Borrower will not, and will not permit any of its Subsidiaries to,
make any Asset Sale other than (i) an Asset Sale constituting a sale of the
capital stock of JVC pursuant to the exercise by Xxxxx-Xxxxxxx Chimie of a call
right under the Put/Call Arrangements, (ii) sales of assets held for
disposition and set forth in Schedule 2.09 and (iii) other Asset Sales the fair
market value of which, when combined with all other such Asset Sales previously
made since the date of this Agreement in reliance on this clause (iii), does
not exceed $10,000,000. The Borrower will not, and will not permit any of its
Subsidiaries to, make any Asset Sale unless at least 80% of the consideration
received for which consists of cash payable at the closing thereof.
SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions.
The Borrower will not, and will not permit any of its Subsidiaries to,
purchase, hold or acquire (including pursuant to any merger with any Person
that was not a wholly owned Subsidiary prior to such merger) any capital stock,
evidences of indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit (any of the foregoing, an
"Investment"), except:
(a) Investments (including without limitation Investments in
joint ventures) in existence on the Effective Date and listed on
Schedule 6.04;
(b) Permitted Investments;
(c) Investments by the Borrower in the capital stock of its
wholly-owned Subsidiaries, subject to Section 5.09;
(d) (i) loans or advances made by the Borrower to any Subsidiary
Guarantor, by any Subsidiary Guarantor to another Subsidiary Guarantor
or by any Subsidiary to the Borrower or any Subsidiary Guarantor;
provided that the aggregate principal amount of loans or advances at
any time outstanding and permitted by this clause (i) will not exceed
$5,000,000, and (ii) loans or advances made by the Borrower to any
Subsidiary (other than (x) a Subsidiary Guarantor or (y) any
Subsidiary listed in clauses (ii) through (v), inclusive, of the
definition of "Excluded Subsidiary") or by any Subsidiary to another
Subsidiary (other than (1) a Subsidiary Guarantor or (2) any
Subsidiary listed in clauses (ii) through (v), inclusive, of the
definition of "Excluded Subsidiary"); provided that the aggregate
principal amount of loans or advances at any time outstanding and
permitted by this clause (ii) will not exceed $1,500,000;
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(e) Guarantees constituting Indebtedness permitted by Section
6.01;
(f) at any date prior to the time JVC is a Subsidiary, (i) the
Intercompany Acquisition Loan, (ii) the Regulatory Guarantees (but
solely if such date falls on or after the Term Drawdown Date) and
(iii) other loans or advances to, or Guarantees of Indebtedness of,
JVC not to exceed in aggregate principal amount $2,500,000;
(g) at any time on or after the time JVC is a Subsidiary, loans
or advances to, or Guarantees of Indebtedness of, JVC;
(h) Investments made after the Effective Date in joint ventures
or non-wholly owned Subsidiaries not permitted by any of the foregoing
clauses not to exceed $10,000,000 in aggregate amount at any time (it
being understood that any increase in the value of any Investment
solely as a result of retained earnings does not constitute an
Investment);
(i) purchases of capital stock of JVC by LII Europe pursuant to
the Put/Call Arrangements or pursuant to other arrangements; provided
that any such purchase made by LII Europe pursuant to any such other
arrangements is on substantially the same material terms (including
without limitation price) as the terms set forth in the Put/Call
Arrangements;
(j) seller notes and other instruments constituting consideration
for an Asset Sale permitted under Section 6.03(c);
(k) subject to Section 6.11, Investments which are Permitted
Acquisitions; and
(l) the Acquisition.
provided that the aggregate amount of Investments in JVC made at any time on or
after it is a Subsidiary shall not exceed $2,500,000.
SECTION 6.05. Hedging Agreements. The Borrower will not, and will not
permit any of its Subsidiaries to, enter into any Hedging Agreement, other than
Hedging Agreements entered into for bona fide hedging purposes (and not for
speculative purposes) in the ordinary course of business.
SECTION 6.06. Restricted Payments; Voluntary Prepayments. (a) The
Borrower will not, and will not permit any of its Subsidiaries to, declare or
make, or agree to pay or make, directly or indirectly, any Restricted Payment,
except (i) the Borrower may declare and pay dividends with respect to its
capital stock payable solely in additional shares of its common stock, (ii) the
Borrower may declare and pay dividends with respect to its common stock in cash
in an aggregate amount not in excess of $2,000,000 with respect to any fiscal
year, (iii) Subsidiaries may declare and pay dividends ratably with respect to
their capital stock, (iv) the Borrower may make Restricted Payments pursuant to
and in accordance with stock option plans or other benefit plans for management
or employees of the Borrower and its Subsidiaries, (v) the
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Borrower may purchase common stock of the Borrower from any employee of the
Borrower in connection with the termination of such employee's employment so
long as the aggregate amount paid in respect of such purchases during the term
of this Agreement does not exceed $3,500,000 and (vi) the Borrower may purchase
common stock from the estate, heirs, executors or administrators of Xxxxxxx Xxx
XxXxxxx to the extent of amounts received by the Borrower as death benefits
paid under insurance policies in place on the Effective Date insuring her life.
(b) The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, optionally redeem, retire, purchase, acquire, defease
or otherwise make any payment other than required interest payments in respect
of any Indebtedness which is subordinated in right of payment to the
Indebtedness of the Borrower or such Subsidiary (including, without limitation,
the Senior Subordinated Notes and the Refinancing Subordinated Notes) under the
Loan Documents; provided that the Borrower may repurchase the Senior
Subordinated Notes pursuant to the Tender Offer.
SECTION 6.07. Transactions with Affiliates. The Borrower will not, and
will not permit any Subsidiary to, directly or indirectly, make any payment to,
or sell, lease, transfer or otherwise dispose of any of its properties or
assets to, or purchase any property or assets from, or enter into or make or
amend any contract, agreement, understanding, loan, advance or guarantee with,
or for the benefit of any of its Affiliates or any officer, director or
employee of the Borrower or any Subsidiary (each an "Affiliate Transaction"),
unless (i) such Affiliate Transaction is on terms which are no less favorable
to the Borrower or such Subsidiary, as the case may be, that would be available
in a comparable transition with an unaffiliated third party and (ii) if such
Affiliate Transaction (or series of related Affiliate Transactions) involves
aggregate payments or the transfer of other consideration between the Borrower
or any of its Subsidiaries and an Affiliate having a Fair Market Value in
excess of $3,000,000, such Affiliate Transaction is in writing and a majority
of the disinterested members of the board of directors of the Borrower shall
have approved such Affiliate Transaction and determined that such Affiliate
Transaction complies with the foregoing provisions. In addition, prior to the
consummation of any Affiliate Transaction involving aggregate payments or the
transfer of other consideration between the Borrower or any of its Subsidiaries
and an Affiliate having a Fair Market Value in excess of $10,000,000, other
than sales or purchases of commodities at prices and on terms at least as
favorable to the Borrower as then prevailing in the market, the Borrower will
deliver to the Lenders a written opinion from an independent financial advisor
stating that the terms of such Affiliate Transactions are fair from a financial
point of view, to the Borrower or such Subsidiary, as the case may be. The
foregoing provisions of this Section shall not apply to (a) transactions
between or among the Borrower and its wholly owned Subsidiaries not involving
any other Affiliate, (b) any Restricted Payment permitted by Section 6.06, (c)
transactions with any officer or director of the Borrower entered into in the
ordinary course of business in the nature of compensation (including employee
benefit arrangements) for services rendered, (d) transactions pursuant to
agreements in existence on the date hereof and listed on Schedule 6.07 and
substantially on the terms set forth in such agreements as in existence on the
date hereof, (e) transactions pursuant to the Acquisition Documents and (f)
Investments permitted under Section 6.04. For purposes of this Section, "Fair
Market Value" means, with respect to any asset, the price (after taking into
account any liabilities relating to such assets) which could be negotiated in
an arm's length free market transaction, for cash, between a willing seller and
a willing and
75
able buyers, neither of which is under any compulsion to complete the
transaction; provided, however, that the Fair Market Value of any such asset or
assets shall be determined conclusively by the board of directors of the
Borrower acting in good faith, and shall be evidenced by resolutions of the
board of directors of the Borrower delivered to the Administrative Agent.
SECTION 6.08. Restrictive Agreements. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, enter into,
incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon (a) the ability of the Borrower or any
Subsidiary to create, incur or permit to exist any Lien upon any of its
property or assets or perform any of its obligations under Section 5.09, or (b)
the ability of any Subsidiary to pay dividends or other distributions with
respect to any shares of its capital stock or to make or repay loans or
advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness
of the Borrower or any other Subsidiary; provided that (i) the foregoing shall
not apply to restrictions and conditions imposed by law or by this Agreement,
(ii) the foregoing shall not apply to restrictions and conditions existing on
the date hereof identified on Schedule 6.08 (but shall apply to any extension
or renewal of (other than in connection with the Refinanced Subordinated
Notes), or any amendment or modification expanding the scope of, any such
restriction or condition), (iii) the foregoing shall not apply to customary
restrictions and conditions contained in agreements relating to the sale of a
Subsidiary pending such sale, provided such restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted hereunder,
(iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Indebtedness and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.
SECTION 6.09. Modification of Certain Documents. Without the consent of
the Required Lenders, the Borrower will not, and will not permit any of its
Subsidiaries to, (i) consent to or solicit or enter into any amendment or
supplement to, or any waiver or other modification of, the Stock Purchase
Agreement, the Put/Call Agreement or of the Put/Call Arrangements, which would
impair materially the benefit to the Borrower or any of its Subsidiaries of
such agreement or arrangements or (ii) consent to or solicit or enter into any
amendment or supplement to, or any waiver or other modification of, the
certificate of incorporation or bylaws of the Borrower or any of its
Subsidiaries, or the Indenture (other than pursuant to the Offer to Purchase
and Consent Solicitation Statement) or any other agreement or instrument
governing the terms of the Senior Subordinated Notes, the Refinancing
Subordinated Notes or of any other Indebtedness which by its terms is expressly
subordinated in right of payment to the Loans and the reimbursement obligations
with respect to LC Disbursements, which amendment, supplement, waiver or
modification, as the case may be, could reasonably be expected to have an
adverse effect on the rights of the Lenders or the Administrative Agent under
the Loan Documents.
SECTION 6.10. Accounting Changes. The Borrower will not change its
fiscal year from a fiscal year ending February 28 or February 29, as the case
may be. The Borrower will not adopt any non-mandatory change in GAAP or the
application thereof without 30 days' prior
76
notice to the Lenders, accompanied, in the case of any material change, by
evidence of concurrence in such change by the public accounting firm regularly
employed by the Borrower.
SECTION 6.11. Capital Expenditures and Permitted Acquisitions. The sum
of Consolidated Capital Expenditures and Permitted Acquisitions for any fiscal
year of the Borrower will not exceed the sum of:
(i) the Base Amount for such fiscal year, plus
(ii) the amount of Excess Cash Flow not required to be
applied to prepay Term Loans during such fiscal year, plus
(iii) an amount equal to the excess (if any) of (A) the
aggregate amount of Consolidated Capital Expenditures and Permitted
Acquisitions permitted by clauses (i) and (ii) above for all fiscal
years of the Borrower ending prior to such fiscal year over (B) the
aggregate amount of Consolidated Capital Expenditures and Permitted
Acquisitions made in such prior fiscal years.
For purposes of this Section, "BASE AMOUNT" means, for each fiscal year of
the Borrower, the amount set forth opposite such fiscal year below:
Fiscal Year Amount
----------- -----------
1998 $75,000,000
1999 55,000,000
2000 25,000,000
2001 25,000,000
2002 30,000,000
2003 30,000,000
Thereafter 30,000,000
If any property acquired or constructed by the Borrower or any Subsidiary
(other than a Foreign Subsidiary) after the date hereof is not subject to the
Lien of the Collateral Documents, the Borrower or such Subsidiary will execute
and deliver such mortgages and other security documents as may be necessary, or
as the Administration Agent may request, to subject such property to such a
Lien.
77
SECTION 6.12. Leverage Ratio. At the last day of any fiscal quarter of
the Borrower in any fiscal year set forth below, the Leverage Ratio will not
exceed the ratio set forth below opposite such fiscal year.
Fiscal Year Ratio
---------------------- ------
Effective Date-5/30/98 5.00:1
5/31/98-5/30/99 4.75:1
5/31/99-5/30/00 4.50:1
5/31/00-5/30/01 4.00:1
5/31/01-5/30/02 3.50:1
Thereafter 3.25:1
SECTION 6.13. Minimum Consolidated Net Worth. At the last day of any
fiscal quarter of the Borrower, Consolidated Net Worth will not be less than an
amount equal to the sum of (i) $37,500,000 and (ii) an amount equal to 50% of
consolidated net income for each successive period of two consecutive fiscal
quarters ended after February 28, 1997 and on or before such day, in each case,
for which consolidated net income is positive (but with no deduction on account
of negative consolidated net income for any such period of two consecutive
fiscal quarters) plus (iii) 100% of the aggregate net proceeds, including the
fair market value of property other than cash (as determined in good faith by
the Borrower's board of directors), received by the Borrower from the issuance
and sale after the date hereof of any capital stock of the Borrower (other than
the proceeds of any issuance and sale of any capital stock (x) to a Subsidiary
or (y) which is required to be redeemed, or is redeemable at the option of the
holder, if certain events or conditions occur or exist or otherwise) or in
connection with the conversion or exchange of any Indebtedness of the Borrower
into capital stock of the Borrower after February 28, 1997.
SECTION 6.14. Interest Coverage Ratio. At the last day of any fiscal
quarter of the Borrower in any fiscal year, the Interest Coverage Ratio will
not be less than the ratio set forth below opposite such fiscal year:
Fiscal Year Ratio
---------------------- ------
Effective Date-5/30/98 1.75:1
5/31/98-5/30/99 2.00:1
5/31/99-5/30/00 2.25:1
5/31/00-5/30/01 2.50:1
Thereafter 2.75:1
ARTICLE VII
Events of Default
If any of the following events ("EVENTS OF DEFAULT") shall occur:
78
(a) the Borrower shall fail to pay any principal of any Loan
or any reimbursement obligation in respect of any LC Disbursement
when and as the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment thereof or
otherwise;
(b) the Borrower shall fail to pay any interest on any Loan
or any fee or any other amount (other than an amount referred to in
clause (a) of this Article) payable under this Agreement, when and
as the same shall become due and payable, and such failure shall
continue unremedied for a period of five days;
(c) any representation or warranty made or deemed made by or
on behalf of any Obligor in or in connection with the Loan
Documents or any amendment or modification thereof or waiver
thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with the Loan
Documents or any amendment or modification thereof or waiver
thereunder, shall prove to have been incorrect when made or deemed
made;
(d) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in Section 5.02, 5.03
(with respect to the Borrower's existence) or 5.08 or in Article VI
of this Agreement, Sections 4(a), 4(e) or 4(k) of the Borrower
Security Agreement, Section 3(b) of the Borrower Pledge Agreement
or in provisions substantially similar to the foregoing set forth
in any other Collateral Document to which any Obligor is a party;
(e) any Obligor shall fail to observe or perform any
covenant, condition or agreement contained in the Loan Documents
(other than those specified in clause (a), (b) or (d) of this
Article), and such failure shall continue unremedied for a period
of 30 days after notice thereof from the Administrative Agent to
the Borrower (which notice will be given at the request of any
Lender);
(f) the Borrower or any Subsidiary shall fail to make any
payment (whether of principal or interest and regardless of amount)
in respect of any Material Indebtedness, when and as the same shall
become due and payable;
(g) any event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled maturity
or that enables or permits (with or without the giving of notice,
the lapse of time or both) the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to
cause any Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity; provided that this clause (g) shall not
apply to secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such
Indebtedness;
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed seeking (i) liquidation,
reorganization or other relief in respect of the Borrower or any
Subsidiary or its debts, or of a substantial part of
79
its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or
any Subsidiary or for a substantial part of its assets, and, in any
such case, such proceeding or petition shall continue undismissed
for 60 days or an order or decree approving or ordering any of the
foregoing shall be entered;
(i) the Borrower or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for
or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Borrower or
any Subsidiary or for a substantial part of its assets, (iv) file
an answer admitting the material allegations of a petition filed
against it in any such proceeding, (v) make a general assignment
for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;
(j) the Borrower or any Subsidiary shall become unable, admit
in writing or fail generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in an
aggregate amount in excess of $2,000,000 shall be rendered against
the Borrower, any Subsidiary or any combination thereof and the
same shall remain undischarged for a period of 30 consecutive days
during which execution shall not be effectively stayed, or any
action shall be legally taken by a judgment creditor to attach or
levy upon any assets of the Borrower or any Subsidiary to enforce
any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion
of the Required Lenders, when taken together with all other ERISA
Events that have occurred, could reasonably be expected to result
in liability of the Borrower and its Subsidiaries in an aggregate
amount exceeding $2,000,000;
(m) a Change in Control shall occur;
(n) any Lien created by any of the Collateral Documents shall
at any time fail to constitute a valid and (to the extent required
by the Collateral Documents) perfected first priority Lien on the
Collateral securing the obligations purported to be secured
thereby, or any party shall so assert in writing; or
(o) the Subsidiary Guarantee shall at any time fail to
constitute a valid and binding agreement of each Subsidiary
Guarantor, or any party shall so assert in writing;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event,
80
the Administrative Agent may, and at the request of the Required Lenders shall,
by notice to the Borrower, take either or both of the following actions, at the
same or different times: (i) terminate the Commitments, and thereupon the
Commitments shall terminate immediately, and (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any
principal not so declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so declared to be due
and payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
SECTION 8.01. Appointment, Powers and Immunities. Each of the Lenders
and the Issuing Bank hereby irrevocably appoints the Administrative Agent as
its agent and authorizes the Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
by the terms of the Loan Documents, together with such actions and powers as
are reasonably incidental thereto.
(b) The bank serving as the Administrative Agent hereunder shall have the
same rights and powers in its capacity as a Lender as any other Lender and may
exercise the same as though it were not the Administrative Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.
(c) The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary
or other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent
is required to exercise in writing by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth herein, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Subsidiaries that is communicated to or obtained by
the bank serving as Administrative Agent or any of its Affiliates in any
capacity. The Administrative Agent shall not be liable for any action taken or
not taken by it with the consent or at the request of the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in
81
Section 9.02) or in the absence of its own gross negligence or wilful
misconduct. The Administrative Agent shall be deemed not to have knowledge of
any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with the
Loan Documents, (ii) the contents of any certificate, report or other document
delivered thereunder or in connection therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth therein, (iv) the validity, enforceability, effectiveness or genuineness
of the Loan Documents or any other agreement, instrument or document, (v) the
existence or the value of any of the Collateral or (vi) the satisfaction of any
condition set forth in Article IV or elsewhere herein or in any other Loan
Document, other than to confirm receipt of items expressly required to be
delivered to, and make determinations expressly required to be made by, the
Administrative Agent.
SECTION 8.02. Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed
or sent by the proper Person. The Administrative Agent also may rely upon any
statement made to it orally or by telephone and believed by it to be made by
the proper Person, and shall not incur any liability for relying thereon. The
Administrative Agent may consult with legal counsel (who may be counsel for any
Obligor), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.
SECTION 8.03. Appointment of Sub-Agents. The Administrative Agent may
perform any and all its duties and exercise its rights and powers by or through
any one or more sub-agents appointed by the Administrative Agent with
reasonable care. The Administrative Agent and any such sub-agent may perform
any and all its duties and exercise its rights and powers through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
SECTION 8.04. Successor Administrative Agents. Subject to the
appointment and acceptance of a successor Administrative Agent as provided in
this paragraph, the Administrative Agent may resign at any time by notifying
the Lenders, the Issuing Bank and the Borrower. Upon any such resignation, the
Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor from among the Lenders. If no successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank, subject, so long as no Default has occurred and is continuing, to
the consent of the Borrower (which shall not be unreasonably withheld). Upon
the acceptance of its appointment as Administrative Agent hereunder by a
successor, such successor shall 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
82
hereunder. The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent's
resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Administrative
Agent.
SECTION 8.05. Non-Reliance on Administrative Agent and Other Lenders.
Each Lender acknowledges that it has, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges 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 from time
to time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon the Loan Documents, any related agreement or
any document furnished thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower, to it at XxXxxxx Industries Inc., 0000
Xxxxxxx Xxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000, Attention of Treasurer
(Telecopy No. (000) 000-0000);
(b) (i) if to the Administrative Agent, at the New York
Office, to The Chase Manhattan Bank, Agent Bank Services Group, One
Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Xxxxxx Xxxxxxx (Telecopy No. (000) 000-0000), with a
copy to The Chase Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx 00000,
Attention of Xxxxx Xxxxxxx and Xxxxxx Xxxxx (Telecopy No. (212)
270-7935) and (ii) if to the Administrative Agent, at the London
Office, to The Chase Manhattan Bank, 9, Xxxxxx Xxxx Street, Trinity
Tower, London E1 9YT, Attention of Xxxxx Xxxxxxx (Telecopy No.
000-000-000-0000);
(c) if to the Issuing Bank, to it at The Chase Manhattan Bank,
0 Xxxxx Xxxxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxx, XX 00000, Attention
of Xxxxxxxx Xxxxxxxxx (Telecopy No. (000) 000-0000); and
(d) if to any other Lender, to it at its address (or telecopy
number) set forth in its completed Administrative Questionnaire,
which address and telecopy number have been provided to the
Borrower.
83
Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.
SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent, the Issuing Bank or any Lender in exercising any right or
power under any Loan Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The
rights and remedies of the Administrative Agent, the Issuing Bank and the
Lenders under the Loan Documents are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision
of this Agreement or any other Loan Document or consent to any departure by the
Borrower therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan
or issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall:
(i) unless signed by all the Lenders with a Commitment of
a Class, increase or decrease the Commitments of such Class (except for
a ratable decrease in all the Commitments of such Class), or postpone
the date fixed for the scheduled termination of any Commitment of such
Class;
(ii) unless signed by all Lenders holding Loans of any
Class, reduce the principal of or (except as expressly provided in the
definition of "Applicable Leverage Ratio") rate of interest on any
Loans of, or fees with respect to, such Class, postpone the date fixed
for any scheduled payment of such fees or the principal of or interest
on any such Loans, or decrease the aggregate amount by which such Loans
are required to be repaid on any date scheduled pursuant to Section
2.09(a) or postpone any date for such repayment;
(iii) unless signed by all Lenders with Revolving
Commitments, reduce the amount of any LC Disbursement or of any
interest thereon or any fees payable by reference to the Letters of
Credit hereunder, postpone the date fixed for any payment of any LC
Disbursement or any interest thereon or any fees payable by reference
to the Letters of Credit hereunder or (except as expressly provided in
Section 2.04) the expiry date of any Letter of Credit;
(iv) unless signed by all the Lenders, change any of the
provisions of this Section or the definition of "REQUIRED LENDERS" or
any other provision hereof
84
specifying the number or percentage of Lenders required to waive, amend
or modify any rights hereunder or make any determination or grant any
consent hereunder; or
(v) unless signed by all the Lenders, change Section
2.17(b) or (c) in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender;
and
provided further that (i) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent or the Issuing Bank
hereunder without the prior written consent of the Administrative Agent or the
Issuing Bank, as the case may be and (ii) no such agreement shall reduce any
amount payable to any Lender under this Agreement (other than principal of or
interest on any Loan, or any fees) or the date fixed for the payment thereof,
without the prior written consent of such Lender.
(c) Neither any Collateral Document nor the Subsidiary Guarantee nor any
provision thereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Borrower and the
Administrative Agent with the consent of the number or percentage of Lenders
set forth therein.
SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (without duplication) (i) all reasonable out-of-pocket expenses
incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of counsel for the Administrative
Agent (including foreign counsel and local counsel), in connection with the
syndication of the credit facilities provided for herein, the preparation and
administration of the Loan Documents or any amendments, modifications or
waivers of the provisions thereof (whether or not the transactions contemplated
thereby shall be consummated), (ii) all reasonable out-of-pocket expenses
incurred by the Issuing Bank in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all out-of-pocket expenses incurred by the Administrative
Agent, the Issuing Bank or any Lender after the occurrence and during the
existence of any Default, including the fees, charges and disbursements of any
counsel for the Administrative Agent, the Issuing Bank or any Lender, in
connection with the enforcement or protection of its rights in connection with
the Loan Documents, including its rights under this Section, or in connection
with the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) The Borrower shall indemnify the Administrative Agent, the Issuing
Bank and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an "INDEMNITEE") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the fees, charges and disbursements of any counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of (i) the execution or delivery of the
Loan Documents or any agreement or instrument contemplated thereby, the
performance by the parties thereto of their respective obligations thereunder
or the consummation of the Transactions or any other transactions contemplated
thereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Bank to honor a demand for payment under
a
85
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by the Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is
a party thereto; provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or wilful
misconduct of such Indemnitee.
(c) To the extent that the Borrower fails to pay any amount required to be
paid by it to the Administrative Agent or the Issuing Bank under paragraph (a)
or (b) of this Section, each Lender having a Commitment of either Class
severally agrees to pay to the Administrative Agent or the Issuing Bank, as the
case may be, such Lender's Applicable Percentage (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought and by
reference to the Commitments of such Class) of such unpaid amount; provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent or the Issuing Bank in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, the Loan Documents or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.
(e) All amounts due under this Section shall be payable promptly after
written demand therefor.
SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that
the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be
null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
the Issuing Bank and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
(b) Any Lender may assign to one or more assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment of either Class and the Loans of such Class and, if applicable, the
related participations in LC Disbursements
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and Letters of Credit); provided that (i) except in the case of an assignment
to a Lender or an Affiliate of a Lender, each of the Borrower and the
Administrative Agent (and, in the case of an assignment of all or a portion of
a Revolving Commitment or any Lender's obligations in respect of its LC
Exposure, the Issuing Bank) must give their prior written consent to such
assignment (which consent shall not be unreasonably withheld), (ii) except in
the case of an assignment to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's Commitment,
the aggregate amount of the Commitments of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall not
be less than $5,000,000 unless each of the Borrower and the Administrative
Agent otherwise consent, (iii) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Commitments or Loans (and,
if applicable, the related participations in LC Disbursements and Letters of
Credit) of either Class (but not necessarily both Classes), (iv) the parties to
each assignment shall execute and deliver to the Administrative Agent an
Assignment and Acceptance, together with a processing and recordation fee of
$3,500, and (v) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire; and provided further that
any consent of the Borrower otherwise required under this paragraph shall not
be required if an Event of Default under clauses (a), (b), (f), (g), (h) or (i)
of Article VII has occurred and is continuing. Subject to acceptance and
recording thereof pursuant to paragraph (d) of this Section, from and after the
effective date specified in each Assignment and Acceptance the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Acceptance, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this paragraph shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with paragraph (e) of this Section.
(c) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy
of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "REGISTER"). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent,
the Issuing Bank and the Lenders may treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower, the Issuing Bank
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to
87
in paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall
accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
(e) Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a "PARTICIPANT") in all or a portion of such Lender's
rights and obligations under this Agreement (including all or a portion of its
Commitment of either Class and the Loans of such Class and, if applicable, the
related participations in LC Disbursements and Letters of Credit); provided
that (i) such Lender's obligations under this Agreement shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto
for the performance of such obligations and (iii) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver described in the first proviso to Section 9.02(b) that affects such
Participant. Subject to paragraph (f) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 2.14, 2.15 and
2.16 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 9.08
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.18(c) as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.14 or 2.16 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were
a Lender shall not be entitled to the benefits of Section 2.16 unless the
Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.16(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment
of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to the Loan Documents
shall be considered to have been relied upon by the other parties hereto and
shall survive the execution and delivery of this Agreement and the making of
any Loans and issuance of any Letters of Credit, regardless of any
investigation made
88
by any such other party or on its behalf and notwithstanding that the
Administrative Agent, the Issuing Bank or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and effect
as long as the principal of or any accrued interest on any Loan or any fee or
any other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06. Counterparts; Integration. This Agreement may be executed
in counterparts (and by different parties hereto on different counterparts),
each of which shall constitute an original, but all of which when taken
together shall constitute a single contract. The Loan Documents and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof.
SECTION 9.07. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any
time owing by such Lender or Affiliate to or for the credit or the account of
the Borrower against any of and all the obligations of the Borrower now or
hereafter existing under the Loan Documents held by such Lender or any of its
Affiliates, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the
law of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to
this Agreement or the other Loan Documents, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such
89
New York State or, to the extent permitted by law, in such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that the Administrative Agent, the Issuing
Bank or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against the Borrower or
its properties in the courts of any jurisdiction.
(c) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in any
court referred to in paragraph (b) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THE LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
SECTION 9.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 9.12. Confidentiality. Each of the Administrative Agent, the
Issuing Bank and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates' directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party to the Loan Documents, (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to the Loan Documents or the enforcement of rights
thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to any assignee of or
90
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under the Loan Documents, (g) with the consent of the
Borrower or (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis from a source other than the Borrower. For the purposes of this Section,
"INFORMATION" means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by the Borrower; provided that, in the case of
information received from the Borrower after the date hereof, such information
is clearly identified at the time of delivery as confidential. Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.
SECTION 9.13. Interest Rate Limitation. Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "CHARGES"), shall exceed
the maximum lawful rate (the "MAXIMUM RATE") which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated
amount, together with interest thereon at the Federal Funds Effective Rate to
the date of repayment, shall have been received by such Lender.
SECTION 9.14. Waivers under Existing Credit Agreement. In order to
facilitate the satisfaction of the condition set forth in Section 4.01(a)(i)
hereof regarding the repayment of the Indebtedness outstanding under the credit
agreement (the "Existing Credit Agreement") listed on Schedule 4.01, each of
the parties hereto which is a party to the Existing Credit Agreement waives the
requirement set forth therein that prior written notice of termination of the
commitments and the repayment of the loans outstanding thereunder be delivered
and that any fixed rate loans outstanding thereunder not be prepaid prior to
the end of the interest period applicable thereto. The waivers granted under
this Section are subject to the obligations of the Borrower to pay to each bank
party to the Existing Credit Agreement all funding losses (if any) payable by
the Borrower to such bank pursuant to the Existing Credit Agreement as a result
of any prepayment.
91
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
XXXXXXX INDUSTRIES INC.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
BANKS
THE CHASE MANHATTAN BANK, individually
and as Administrative Agent
By: /s/ Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: Vice President
HIBERNIA NATIONAL BANK
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
WACHOVIA BANK, N.A
By: /s/ X. Xxxxxxxx Xxxxx, Jr.
Name: X. Xxxxxxxx Rison, Jr.
Title: Vice President
00
XXX XXXX XX XXXX XXXXXX
By: /s/ F.C.E. Xxxxx
Name: F.C.E. Xxxxx
Title: Senior Manager
Loan Operations
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Vice President
AMSOUTH BANK
By: /s/ Xxxx X. Xxxx
Name: Xxxx X. Xxxx
Title: Vice President
BHF-BANK AKTIENGESELLSCHAFT
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Vice President
By: /s/ Xxxxx Xxxx
Name: Xxxxx Xxxx
Title: Vice President
93
COMERICA BANK
By: /s/ Xxxxxxxx X. Xxxxxxxx
Name: Xxxxxxxx X. Xxxxxxxx
Title: Account Officer
NATIONAL BANK OF CANADA
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
BANQUE PARIBAS
By: /s/ Xxxxx Xxxxxxxxx
Name: Xxxxx Xxxxxxxxx
Title: Vice President
By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxxxx
Title: Director
94
The following schedules and exhibits have not been included, but will be
provided in hard copy upon request.
SCHEDULES:
Schedule 1.01 -- Mortgages
Schedule 2.01 -- Commitments
Schedule 2.09 -- Assets Held for Disposition
Schedule 3.03 -- Potential Indenture Defaults
Schedule 3.06 -- Environmental Matters
Schedule 4.01 -- Indebtedness to be Refinanced on the Effective Date; Mortgage
Title Insurance Amounts
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.04 -- Existing Investments
Schedule 6.07 -- Existing Agreements Pursuant to Which Transactions with
Affiliates May Be Consummated
Schedule 6.08 -- Existing Restrictions
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Form of Borrower Pledge Agreement
Exhibit C -- Form of Borrower Security Agreement
Exhibit D -- Form of Subsidiary Guarantee
Exhibit E -- Form of Subsidiary Pledge Agreement
Exhibit F -- Form of Subsidiary Security Agreement
Exhibit G -- Form of Opinion of Counsel for Obligors
Exhibit H -- Form of Opinion of Real Estate Counsel for the Obligors
Exhibit I -- Form of Opinion of Special Counsel for the Administrative Agent
