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EXHIBIT 10.1
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CREDIT AGREEMENT
AMONG
X'XXXXXXXX INDUSTRIES, INC.,
AS BORROWER,
X'XXXXXXXX INDUSTRIES HOLDINGS, INC.,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTIES HERETO,
XXXXXX BROTHERS INC.,
AS LEAD ARRANGER AND BOOK MANAGER
WACHOVIA BANK, N.A.,
AS SYNDICATION AGENT
XXXXXX COMMERCIAL PAPER INC.,
AS ADMINISTRATIVE AGENT
AND
GENERAL ELECTRIC CAPITAL CORPORATION,
AS DOCUMENTATION AGENT
DATED AS OF NOVEMBER 30, 1999
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TABLE OF CONTENTS
SECTION 1. DEFINITIONS.........................................................................................1
1.1 Defined Terms.......................................................................................1
1.2 Other Definitional Provisions......................................................................29
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS....................................................................29
2.1 Term Loan Commitments..............................................................................29
2.2 Procedure for Term Loan Borrowing..................................................................30
2.3 Repayment of Term Loans............................................................................30
2.4 Revolving Credit Commitments.......................................................................31
2.5 Procedure for Revolving Credit Borrowing...........................................................32
2.6 Swing Line Commitment..............................................................................32
2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans..................................33
2.8 Repayment of Loans; Evidence of Indebtedness.......................................................34
2.9 Commitment Fees, etc...............................................................................35
2.10 Termination or Reduction of Revolving Credit Commitments...........................................36
2.11 Optional Prepayments...............................................................................36
2.12 Mandatory Prepayments and Commitment Reductions....................................................36
2.13 Conversion and Continuation Options................................................................38
2.14 Minimum Amounts and Maximum Number of Eurodollar Tranches..........................................38
2.15 Interest Rates and Payment Dates...................................................................39
2.16 Computation of Interest and Fees...................................................................39
2.17 Inability to Determine Interest Rate...............................................................40
2.18 Pro Rata Treatment and Payments....................................................................40
2.19 Requirements of Law................................................................................42
2.20 Taxes..............................................................................................43
2.21 Indemnity..........................................................................................46
2.22 Illegality.........................................................................................47
2.23 Change of Lending Office...........................................................................47
2.24 Replacement of Lenders under Certain Circumstances.................................................47
SECTION 3. LETTERS OF CREDIT..................................................................................48
3.1 L/C Commitment.....................................................................................48
3.2 Procedure for Issuance of Letter of Credit.........................................................48
3.3 Fees and Other Charges.............................................................................48
3.4 L/C Participations.................................................................................49
3.5 Reimbursement Obligation of the Borrower...........................................................50
3.6 Obligations Absolute...............................................................................50
3.7 Letter of Credit Payments..........................................................................51
3.8 Applications.......................................................................................51
SECTION 4. REPRESENTATIONS AND WARRANTIES.....................................................................51
4.1 Financial Condition................................................................................51
4.2 No Change..........................................................................................52
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4.3 Corporate Existence; Compliance with Law...........................................................52
4.4 Corporate Power; Authorization; Enforceable Obligations............................................52
4.5 No Legal Bar.......................................................................................53
4.6 No Material Litigation.............................................................................53
4.7 No Default.........................................................................................53
4.8 Ownership of Property; Liens.......................................................................53
4.9 Intellectual Property..............................................................................53
4.10 Taxes..............................................................................................54
4.11 Federal Regulations................................................................................54
4.12 Labor Matters......................................................................................54
4.13 ERISA..............................................................................................54
4.14 Investment Company Act; Other Regulations..........................................................55
4.15 Subsidiaries.......................................................................................55
4.16 Use of Proceeds....................................................................................55
4.17 Environmental Matters..............................................................................55
4.18 Accuracy of Information, etc.......................................................................56
4.19 Security Documents.................................................................................57
4.20 Solvency...........................................................................................58
4.21 Senior Indebtedness................................................................................58
4.22 Regulation H.......................................................................................58
4.23 Year 2000 Matters..................................................................................58
4.24 Insurance..........................................................................................59
4.25 Acquisition Documentation..........................................................................59
4.26 Mortgaged Properties...............................................................................59
4.27 Permits............................................................................................61
4.28 Lease Payments.....................................................................................61
SECTION 5. CONDITIONS PRECEDENT...............................................................................62
5.1 Conditions to Initial Extension of Credit..........................................................62
5.2 Conditions to Each Extension of Credit.............................................................67
SECTION 6. AFFIRMATIVE COVENANTS..............................................................................68
6.1 Financial Statements...............................................................................68
6.2 Certificates; Other Information....................................................................69
6.3 Payment of Obligations.............................................................................71
6.4 Conduct of Business and Maintenance of Existence, etc..............................................71
6.5 Maintenance of Property; Insurance.................................................................71
6.6 Inspection of Property; Books and Records; Discussions.............................................73
6.7 Notices............................................................................................73
6.8 Environmental Laws.................................................................................74
6.9 Interest Rate Protection...........................................................................74
6.10 Additional Collateral, etc.........................................................................74
6.11 Year 2000..........................................................................................76
6.12 Use of Proceeds....................................................................................76
6.13 ERISA Documents....................................................................................76
6.14 Further Assurances.................................................................................77
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SECTION 7. NEGATIVE COVENANTS.................................................................................77
7.1 Financial Condition Covenants......................................................................78
7.2 Limitation on Indebtedness.........................................................................82
7.3 Limitation on Liens................................................................................83
7.4. Limitation on Fundamental Changes..................................................................84
7.5. Limitation on Disposition of Property..............................................................84
7.6. Limitation on Restricted Payments..................................................................85
7.7. Limitation on Capital Expenditures.................................................................86
7.8. Limitation on Investments..........................................................................87
7.9. Limitation on Optional Payments and Modifications of Indebtedness..................................87
7.10. Limitation on Transactions with Affiliates.........................................................88
7.11. Limitation on Sales and Leasebacks.................................................................88
7.12. Limitation on Changes in Fiscal Periods............................................................88
7.13. Limitation on Negative Pledge Clauses..............................................................89
7.14. Limitation on Restrictions on Subsidiary Distributions, etc........................................89
7.15. Limitation on Lines of Business....................................................................89
7.16 Limitation on Amendments to Tandy Tax Sharing Agreement, Acquisition Documentation and Senior
Holdings Note Documentation........................................................................89
7.17 Limitation on Hedge Agreements.....................................................................90
7.18 Partnerships and Joint Ventures....................................................................90
7.19 Limitation on Activities of Holdings...............................................................90
7.20 Management Fees....................................................................................90
SECTION 8. EVENTS OF DEFAULT..................................................................................90
SECTION 9. THE AGENTS; THE ARRANGER...........................................................................95
9.1 Appointment........................................................................................95
9.2 Delegation of Duties...............................................................................95
9.3 Exculpatory Provisions.............................................................................95
9.4 Reliance by Agents.................................................................................95
9.5 Notice of Default..................................................................................96
9.6 Non-Reliance on Agents and Other Lenders...........................................................96
9.7 Indemnification....................................................................................97
9.8 Arranger and Agents in Their Individual Capacities.................................................97
9.9 Successor Agents...................................................................................97
9.10 Authorization to Release Liens.....................................................................98
9.11 The Arranger.......................................................................................98
SECTION 10. MISCELLANEOUS......................................................................................98
10.1 Amendments and Waivers.............................................................................98
10.2 Notices............................................................................................99
10.3 No Waiver; Cumulative Remedies....................................................................102
10.4 Survival of Representations and Warranties........................................................102
10.5 Payment of Expenses...............................................................................102
10.6 Successors and Assigns; Participations and Assignments............................................103
10.7 Adjustments; Set-off..............................................................................106
10.8 Counterparts......................................................................................106
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10.9 Severability......................................................................................106
10.10 Integration.......................................................................................107
10.11 Governing Law.....................................................................................107
10.12 Submission To Jurisdiction; Waivers...............................................................107
10.13 Acknowledgments...................................................................................107
10.14 Confidentiality...................................................................................108
10.15 Release of Collateral and Guarantee Obligations...................................................108
10.16 Accounting Changes................................................................................109
10.17 Delivery of Lender Addenda........................................................................109
10.18 Construction......................................................................................109
10.19 Waivers of Jury Trial.............................................................................109
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ANNEXES:
A Pricing Grid
SCHEDULES:
1.1 Mortgaged Properties
4.4 Consents, Authorizations, Filings and Notices
4.15 Subsidiaries
4.17 Environmental Compliance
4.19(a)-1 UCC Filing Jurisdictions - Collateral
4.19(a)-2 UCC Financing Statements to Remain on File
4.19(a)-3 UCC Financing Statements to be Terminated
4.19(b) Mortgage Filing Jurisdictions
4.19(c) UCC Filing Jurisdictions - Intellectual Property Collateral
4.25 Acquisition Documentation
7.2(d) Existing Indebtedness
7.3(f) Existing Liens
EXHIBITS
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D Form of Mortgage
E Form of Assignment and Acceptance
F-1 Form of Legal Opinion of Xxxxxxxx & Xxxxx
G-1 Form of Term Note
G-2 Form of Revolving Credit Note
G-3 Form of Swing Line Note
H Form of Prepayment Option Notice
I Form of Exemption Certificate
J Form of Lender Addendum
K Form of Solvency Certificate
L Form of Subordinated Intercompany Note
M Form of Notice of Borrowing
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CREDIT AGREEMENT, dated as of November 30, 1999, among X'Xxxxxxxx
Industries, Inc., a Delaware corporation (the "Borrower"), X'Xxxxxxxx Industries
Holdings, Inc., a Delaware corporation ("Holdings"), the several banks and other
financial institutions or entities from time to time parties to this Agreement
(the "Lenders"), Xxxxxx Brothers Inc., as advisor, lead arranger and book
manager (in such capacity, the "Arranger"), WACHOVIA BANK, N.A., as syndication
agent (in such capacity, the "Syndication Agent"), and Xxxxxx Commercial Paper
Inc., as administrative agent (in such capacity, the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Sponsor has incorporated OSI, a Wholly Owned Subsidiary of the
Sponsor, for purposes of effecting the transactions contemplated by the
Acquisition Agreement (each, as defined below);
WHEREAS, pursuant to the Acquisition Agreement, the Sponsor will acquire
all of the issued and outstanding common stock (except for that portion of the
common stock retained by certain members of the management of Holdings and their
designees) of Holdings through a merger of OSI with and into Holdings with
Holdings as the surviving corporation;
WHEREAS, the Borrower is a Wholly Owned Subsidiary of Holdings;
WHEREAS, the Borrower has requested that the Lenders make credit facilities
available to the Borrower in order to finance the foregoing transactions and for
the other purposes set forth herein;
WHEREAS, the Lenders are willing to make such credit facilities available
upon and subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the agreements
hereinafter set forth, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.
"Acquisition": the acquisition pursuant to the Acquisition Agreement,
by the Sponsor of the issued and outstanding common stock (except for that
portion of the common stock retained by certain members of the management
of Holdings and their designees) of Holdings through a merger of OSI with
and into Holdings.
"Acquisition Agreement": the Amended and Restated Agreement and Plan
of Merger between OSI and Holdings, dated as of October 18, 1999, as the
same may be amended, supplemented, replaced or otherwise modified from time
to time in accordance with this Agreement.
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"Acquisition Documentation": collectively, the Acquisition Agreement
and all schedules, exhibits, annexes and amendments thereto and all side
letters and agreements affecting the terms thereof or entered into in
connection therewith, in each case, as amended, supplemented, replaced or
otherwise modified from time to time.
"Adjustment Date": as defined in the Pricing Grid.
"Administrative Agent": as defined in the preamble hereto.
"Affiliate": as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, either to (a) vote 10% or more of
the securities having ordinary voting power for the election of directors
(or persons performing similar functions) of such Person or (b) direct or
cause the direction of the management and policies of such Person, whether
by contract or otherwise.
"Agents": the collective reference to the Syndication Agent and the
Administrative Agent.
"Aggregate Exposure": with respect to any Lender at any time, an
amount equal to (a) until the Closing Date, the aggregate amount of such
Lender's Commitments at such time and (b) thereafter, the sum of (i) the
aggregate then unpaid principal amount of such Lender's Term Loans and (ii)
the amount of such Lender's Revolving Credit Commitment then in effect or,
if the Revolving Credit Commitments have been terminated, the amount of
such Lender's Revolving Extensions of Credit then outstanding.
"Aggregate Exposure Percentage": with respect to any Lender at any
time, the ratio (expressed as a percentage) of such Lender's Aggregate
Exposure at such time to the Aggregate Exposure of all Lenders at such
time.
"Agreement": this Credit Agreement, as amended, supplemented, replaced
or otherwise modified from time to time in accordance with this Agreement.
"Applicable Margin": for each Type of Loan, the rate per annum set
forth under the relevant column heading below:
Base Rate Eurodollar
Loans Loans
--------- ----------
Revolving Credit Loans and
Swing Line Loans 2.25% 3.25%
Tranche A Term Loans 2.25% 3.25%
Tranche B Term Loans 2.75% 3.75%
provided, that on and after the first Adjustment Date occurring after the
completion of two full fiscal quarters of the Borrower after the Closing
Date, the Applicable Margin
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with respect to Revolving Credit Loans, Swing Line Loans and Tranche A Term
Loans will be determined pursuant to the Pricing Grid.
"Application": an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to open a Letter
of Credit.
"Arranger": as defined in the preamble hereto.
"Asset Sale": any Disposition of Property or series of related
Dispositions of Property (excluding any such Disposition permitted by
clause (a), (b), (c), (d), (f), (g) or (h) of Section 7.5) which yields
gross proceeds to the Borrower or any of its Subsidiaries (valued at the
initial principal amount thereof in the case of non-cash proceeds
consisting of notes or other debt securities and valued at fair market
value in the case of other non-cash proceeds) in excess of $2,000,000.
"Assignee": as defined in Section 10.6(c).
"Assignor": as defined in Section 10.6(c).
"Available Revolving Credit Commitment": as to any Revolving Credit
Lender at any time, an amount equal to the excess, if any, of (a) such
Lender's Revolving Credit Commitment then in effect over (b) such Lender's
Revolving Extensions of Credit then outstanding; provided, that in
calculating any Lender's Revolving Extensions of Credit for the purpose of
determining such Lender's Available Revolving Credit Commitment pursuant to
Section 2.9(a), the aggregate principal amount of Swing Line Loans then
outstanding shall be deemed to be zero.
"Base Rate": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Base CD Rate in effect on such day plus
1% and (c) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. For purposes hereof: "Prime Rate" shall mean the rate of interest
per annum publicly announced from time to time by the Reference Lender as
its prime or base rate in effect at its principal office in New York City
(the Prime Rate not being intended to be the lowest rate of interest
charged by the Reference Lender in connection with extensions of credit to
debtors); "Base CD Rate" shall mean the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of which
is one and the denominator of which is one minus the C/D Reserve Percentage
and (b) the C/D Assessment Rate; and "Three-Month Secondary CD Rate" shall
mean, for any day, the secondary market rate for three-month certificates
of deposit reported as being in effect on such day (or, if such day shall
not be a Business Day, the next preceding Business Day) by the Board
through the public information telephone line of the Federal Reserve Bank
of New York (which rate will, under the current practices of the Board, be
published in Federal Reserve Statistical Release H.15(519) during the week
following such day), or, if such rate shall not be so reported on such day
or such next preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 A.M., New York City
time, on such day (or, if such day shall not be
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a Business Day, on the next preceding Business Day) by the Reference Lender
from three New York City negotiable certificate of deposit dealers of
recognized standing selected by it. Any change in the Base Rate due to a
change in the Prime Rate, the Three-Month Secondary CD Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on
the effective day of such change in the Prime Rate, the Three-Month
Secondary CD Rate or the Federal Funds Effective Rate, respectively.
"Base Rate Loans": Loans for which the applicable rate of interest is
based upon the Base Rate.
"Benefited Lender": as defined in Section 10.7.
"Board": the Board of Governors of the Federal Reserve System of the
United States (or any successor).
"Borrower": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrower as a date
on which the Borrower requests the relevant Lender(s) to make Loans
hereunder.
"Business Day": (i) for all purposes other than as covered by clause
(ii) below, a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to
close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day
which is a Business Day described in clause (i) and which is also a day for
trading by and between banks in Dollar deposits in the interbank eurodollar
market.
"Capital Expenditures": for any period, with respect to any Person,
the aggregate of all expenditures by such Person and its Subsidiaries for
the acquisition or leasing (pursuant to a capital lease) of fixed or
capital assets or additions to equipment (including replacements,
capitalized repairs and improvements during such period) which should be
capitalized under GAAP on a consolidated balance sheet of such Person and
its Subsidiaries.
"Capital Expenditure Carry Forward": as defined in Section 7.7.
"Capital Lease Obligations": as to any Person, 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, for the purposes of this Agreement, the amount of such
obligations at any time shall be the capitalized amount thereof at such
time determined in accordance with GAAP.
"Capital Stock": (i) in the case of a corporation, any and all shares,
interests, participations or other equivalents (however designated) of
capital stock and (ii) in the case of any other Person, any and all
equivalent ownership or profit interests in a Person
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and in the case of clause (i) or (ii) above, any and all warrants, rights
or options to purchase any of the foregoing.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the
date of acquisition issued by any Lender or by any commercial bank
organized under the laws of the United States of America or any state
thereof having combined capital and surplus of not less than $250,000,000;
(c) commercial paper of an issuer rated at least A-2 by Standard & Poor's
Ratings Services ("S&P") or P-2 by Xxxxx'x Investors Service, Inc.
("Moody's"), or carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies cease publishing
ratings of commercial paper issuers generally, and maturing within six
months from the date of acquisition; (d) repurchase obligations of any
Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth
or territory of the United States, by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory,
political subdivision, taxing authority or foreign government (as the case
may be) are rated at least A by S&P or A by Moody's; (f) securities with
maturities of six months or less from the date of acquisition backed by
standby letters of credit issued by any Lender or any commercial bank
satisfying the requirements of clause (b) of this definition; or (g) shares
of money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of clauses (a) through (f) of this definition.
"C/D Assessment Rate": for any day as applied to any Base Rate Loan,
the annual assessment rate in effect on such day that is payable by a
member of the Bank Insurance Fund maintained by the Federal Deposit
Insurance Corporation (the "FDIC") classified as well-capitalized and
within supervisory subgroup "B" (or a comparable successor assessment risk
classification) within the meaning of 12 C.F.R. ss. 327.4 (or any successor
provision) to the FDIC (or any successor) for the FDIC's (or such
successor's) insuring time deposits at offices of such institution in the
United States.
"C/D Reserve Percentage": for any day as applied to any Base Rate
Loan, that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board, for determining the maximum reserve
requirement for a Depositary Institution (as defined in Regulation D of the
Board as in effect from time to time) in respect of new non-personal time
deposits in Dollars having a maturity of 30 days or more.
"Closing Date": the date on which the conditions precedent set forth
in Section 5.1 shall have been satisfied, which date shall be not later
than November 30, 1999.
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"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": all Property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security
Document, including, without limitation, the Intellectual Property
Collateral.
"Commitment": as to any Lender, the sum of the Tranche A Term Loan
Commitment, the Tranche B Term Loan Commitment, and the Revolving Credit
Commitment of such Lender.
"Commitment Fee Rate": 1/2 of 1% per annum; provided, that on and
after the first Adjustment Date occurring after the completion of two full
fiscal quarters of the Borrower after the Closing Date, the Commitment Fee
Rate will be determined pursuant to the Pricing Grid.
"Commitment Letter": the Commitment Letter, dated October 17, 1999,
among the Sponsor, OSI, the Agents and the Arranger, as the same may be
amended, supplemented, replaced or otherwise modified from time to time in
accordance with this Agreement.
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of
Section 4001 of ERISA or is part of a group that includes the Borrower and
that is treated as a single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.
"Confidential Information Memorandum": the Confidential Information
Memorandum dated October, 1999 and furnished to the initial Lenders.
"Consolidated Current Assets": at any date, all amounts (other than
cash and Cash Equivalents) which would, in conformity with GAAP, be set
forth opposite the caption "total current assets" (or any like caption) on
a consolidated balance sheet of the Borrower and its Subsidiaries at such
date.
"Consolidated Current Liabilities": at any date, all amounts that
would, in conformity with GAAP, be set forth opposite the caption "total
current liabilities" (or any like caption) on a consolidated balance sheet
of the Borrower and its Subsidiaries at such date, but excluding (a) the
current portion of any Funded Debt of the Borrower and its Subsidiaries and
(b) without duplication of clause (a) above, all Indebtedness consisting of
Revolving Credit Loans or Swing Line Loans to the extent otherwise included
therein.
"Consolidated EBITDA": of any Person for any period, Consolidated Net
Income of such Person and its Subsidiaries for such period plus, without
duplication and to the extent reflected as a charge in the statement of
such Consolidated Net Income for such period, the sum of (a) all provisions
for Federal, state or other domestic and foreign income tax expense
(including, without limitation, any franchise taxes imposed in lieu of
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income taxes), (b) Consolidated Interest Expense of such Person and its
Subsidiaries, amortization or write-off of debt discount and debt issuance
costs and commissions, discounts and other fees and charges associated with
Indebtedness (including, in the case of the Borrower, the Loans and Letters
of Credit), (c) depreciation and amortization expense, (d) amortization of
intangibles (including, but not limited to, goodwill) and organization
costs, (e) any extraordinary, unusual or non-recurring expenses or losses
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, losses on sales
of assets outside of the ordinary course of business) and (f) any other
non-cash charges, and minus, to the extent included in the statement of
such Consolidated Net Income for such period, the sum of (a) interest
income (except to the extent deducted in determining Consolidated Interest
Expense), (b) any extraordinary, unusual or non-recurring income or gains
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, gains on the
sales of assets outside of the ordinary course of business) and (c) any
other non-cash income, all as determined on a consolidated basis; provided
that for purposes of calculating Consolidated EBITDA of the Borrower and
its Subsidiaries for any period, (i) the Consolidated EBITDA of any Person
or business acquired by the Borrower or its Subsidiaries during such period
shall be included on a pro forma basis for such period (assuming the
consummation of such acquisition and the incurrence or assumption of any
Indebtedness in connection therewith occurred on the first day of such
period) if the consolidated balance sheet of such acquired Person or
business and its consolidated Subsidiaries as at the end of the period
preceding the acquisition of such Person or business and the related
consolidated statements of income and stockholders' equity and of cash
flows for the period in respect of which Consolidated EBITDA is to be
calculated (x) have been previously provided to the Administrative Agent
and the Lenders and (y) either (1) have been reported on without a
qualification arising out of the scope of the audit by independent
certified public accountants of nationally recognized standing or (2) have
been found acceptable by the Administrative Agent and (ii) the Consolidated
EBITDA of any Person or business Disposed of by the Borrower or its
Subsidiaries during such period shall be excluded for such period (assuming
the consummation of such Disposition and the repayment of any Indebtedness
in connection therewith occurred on the first day of such period).
"Consolidated Fixed Charge Coverage Ratio": for any period, the ratio
of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for such
period minus the aggregate amount actually paid by the Borrower and its
Subsidiaries in cash or Cash Equivalents during such period on account of
Capital Expenditures (except for such amounts paid from Excess Cash Flow
remaining after giving effect to any mandatory prepayment required by
Section 2.12(c)) to (b) Consolidated Fixed Charges for such period.
"Consolidated Fixed Charges": for any period, the sum (without
duplication) of (a) Consolidated Interest Expense of the Borrower and its
Subsidiaries for such period, (b) provision for cash income taxes made by
the Borrower or any of its Subsidiaries on a consolidated basis in respect
of such period and (c) scheduled payments made during such period on
account of principal of Indebtedness of the Borrower or any of its
Subsidiaries (including scheduled principal payments in respect of the Term
Loans, other
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than any such payments on the Tranche B Term Loans required to be made
under Section 2.3 from and after March 31, 2006 through and including June
30, 2007).
"Consolidated Funded Debt": at any date, the aggregate principal
amount of all Funded Debt of the Borrower and its Subsidiaries at such
date, determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Coverage Ratio": for any period, the ratio of
(a) Consolidated EBITDA of the Borrower and its Subsidiaries for such
period to (b) Consolidated Interest Expense of the Borrower and its
Subsidiaries for such period.
"Consolidated Interest Expense": of any Person for any period, total
cash interest expense (including that attributable to Capital Lease
Obligations) of such Person and its Subsidiaries for such period with
respect to all outstanding Indebtedness of such Person and its Subsidiaries
(including, without limitation, all commissions, discounts and other fees
and charges owed by such Person with respect to letters of credit and
bankers' acceptance financing and net costs of such Person under Hedge
Agreements in respect of interest rates to the extent such net costs are
allocable to such period in accordance with GAAP including, in the case of
the Borrower, all capitalized fees and expenses incurred in connection with
the execution and delivery of this Agreement and the initial extension of
credit hereunder and the issuance of the Senior Subordinated Notes under
the Senior Subordinated Note Indenture on the Closing Date).
"Consolidated Leverage Ratio": as at the last day of any period of
four consecutive fiscal quarters, the ratio of (a) Consolidated Funded Debt
on such day to (b) Consolidated EBITDA of the Borrower and its Subsidiaries
for such period.
"Consolidated Net Income": of any Person for any period, the
consolidated net income (or loss) of such Person and its Subsidiaries for
such period, determined on a consolidated basis in accordance with GAAP;
provided, that in calculating Consolidated Net Income of the Borrower and
its consolidated Subsidiaries for any Period, there shall be excluded (a)
the income (or deficit) of any Person accrued prior to the date it becomes
a Subsidiary of the Borrower or is merged into or consolidated with the
Borrower or any of its Subsidiaries, (b) the income (or deficit) of any
Person (other than a Subsidiary of the Borrower) in which the Borrower or
any of its Subsidiaries has an ownership interest, except to the extent
that any such income is actually received by the Borrower or such
Subsidiary in the form of dividends or similar distributions and (c) the
undistributed earnings of any Subsidiary of the Borrower to the extent that
the declaration or payment of dividends or similar distributions by such
Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Loan Document) or Requirement of Law
applicable to such Subsidiary.
"Consolidated Working Capital": at any date, the excess of
Consolidated Current Assets on such date over Consolidated Current
Liabilities on such date.
"Continuing Directors": as to any Person, the directors of such Person
on the Closing Date, after giving effect to the Acquisition and the other
transactions
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contemplated hereby, and each other director, if, in each case, such other
director's nomination for election to the board of directors of such Person
is recommended by at least 66-2/3% (or if there are fewer than six
directors on the board of directors, 60%) of the then Continuing Directors
or such other director receives the vote of each of the shareholders of
such Person on the Closing Date in his or her election by the shareholders
of such Person.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.
"Control Agreement": each Control Agreement to be executed and
delivered by each Loan Party party thereto, substantially in the form of
Exhibit C, Exhibit D or Exhibit E, as the case may be, to the Guarantee and
Collateral Agreement, as the same may be amended, supplemented, replaced or
otherwise modified from time to time in accordance with this Agreement.
"Control Investment Affiliate": as to any Person, any other Person
that (a) directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person and (b) is organized by such Person
primarily for the purpose of making equity or debt investments in one or
more companies. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, to direct or cause the direction
of the management and policies of such Person whether by contract or
otherwise.
"Default": any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
"Derivatives Counterparty": as defined in Section 7.6.
"Disposition": with respect to any Property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer, license or other disposition
thereof; and the terms "Dispose" and "Disposed of" shall have correlative
meanings.
"Disqualified Stock": any Capital Stock of any Loan Party that any
Loan Party is or, upon the passage of time or the occurrence of any event,
may become obligated to redeem, purchase, retire, defease or otherwise make
any payment in respect of in consideration other than Capital Stock (other
than Disqualified Stock).
"Dollars" and "$": dollars in lawful currency of the United States of
America.
"Domestic Subsidiary": any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States of America.
"ECF Percentage": with respect to any fiscal year of the Borrower,
75%; provided, that, the ECF Percentage shall be 50% if the Consolidated
Leverage Ratio as of the last day of such fiscal year is less than 3.0 to
1.0.
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"Environmental Laws": any and all laws, rules, orders, regulations,
statutes, ordinances, guidelines, codes, decrees, or other legally
enforceable requirements (including, without limitation, common law) of any
international authority, foreign government, the United States, or any
state, local, municipal or other governmental authority, regulating,
relating to or imposing liability or standards of conduct concerning
protection of the environment or of human health, or employee health and
safety, as has been, is now, or may at any time hereafter be, in effect.
"Environmental Permits": any and all permits, licenses, approvals,
registrations, notifications, exemptions and any other authorization
required under any Environmental Law.
"Equity Documents": the Merger Agreement, the Management Subscription
Agreement, the Management Stock Agreement, the 1999 Preferred Stock Option,
each of the Preferred Stock Option Agreements, the Shareholders Agreement,
the Holdco Stock Registration Rights Agreement and the 1999 Common Stock
Option Plan.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Eurocurrency Reserve Requirements": for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such
day (including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board or other Governmental
Authority having jurisdiction with respect thereto) dealing with reserve
requirements prescribed for eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Board) maintained by a
member bank of the Federal Reserve System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on
the basis of the rate for deposits in Dollars for a period equal to such
Interest Period commencing on the first day of such Interest Period
appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London
time, two Business Days prior to the beginning of such Interest Period. In
the event that such rate does not appear on Page 3750 of the Telerate
screen (or otherwise on such screen), the "Eurodollar Base Rate" for
purposes of this definition shall be determined by reference to such other
comparable publicly available service for displaying eurodollar rates as
may be selected by the Administrative Agent or, in the absence of such
availability, by reference to the rate at which the Reference Lender is
offered Dollar deposits at or about 11:00 A.M., London time, two Business
Days prior to the beginning of such Interest Period in the London interbank
eurodollar market for delivery on the first day of such Interest Period for
the number of days comprised therein.
"Eurodollar Loans": Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
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"Eurodollar Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upward to the
nearest 1/16th of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar Loans the
then current Interest Periods with respect to all of which begin on the
same date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).
"Event of Default": any of the events specified in Section 8, provided
that any requirement for the giving of notice, the lapse of time, or both,
has been satisfied.
"Excess Cash Flow": for any fiscal year of the Borrower, the excess,
if any, of (a) the sum, without duplication, of (i) Consolidated Net Income
of the Borrower and its Subsidiaries for such fiscal year, (ii) an amount
equal to the amount of all non-cash charges (including depreciation and
amortization) deducted in arriving at such Consolidated Net Income, (iii)
decreases in Consolidated Working Capital of the Borrower and its
Subsidiaries for such fiscal year, (iv) an amount equal to the aggregate
net non-cash loss on the Disposition of Property by the Borrower and its
Subsidiaries during such fiscal year (other than sales of inventory in the
ordinary course of business), to the extent deducted in arriving at such
Consolidated Net Income, (v) the net increase during such fiscal year (if
any) in deferred tax accounts of the Borrower and its Subsidiaries, (vi) an
amount equal to the Net Cash Proceeds received by the Borrower or any of
its Subsidiaries in such fiscal year from the sale of stock of Holdings to
employees of the Borrower or any of its Subsidiaries after the Closing Date
and (vii) in such fiscal year, the amount of Capital Expenditure Carry
Forward not expended by the Borrower or any of its Subsidiaries on Capital
Expenditures which was accrued in the immediately preceding fiscal year
over (b) the sum, without duplication, of (i) an amount equal to the amount
of all non-cash credits included in arriving at such Consolidated Net
Income, (ii) the aggregate amount actually paid by the Borrower and its
Subsidiaries in cash during such fiscal year on account of Capital
Expenditures plus any amount of Capital Expenditure Carry Forward accrued
during such fiscal year (excluding the principal amount of Indebtedness
incurred in connection with such expenditures and any such expenditures
financed with the proceeds of any Reinvestment Deferred Amount), (iii) the
aggregate amount of all regularly scheduled principal payments of Funded
Debt (including, without limitation, the Term Loans) of the Borrower and
its Subsidiaries and any optional prepayments of Loans (other than in
respect of any revolving credit facility to the extent there is not an
equivalent permanent reduction in commitments thereunder such that after
giving effect to such commitment reduction the Borrower or the applicable
Subsidiary, as the case may be, would not be able to reborrow all or any of
the amount so prepaid), in each case, made during such fiscal year, (iv)
increases in Consolidated Working Capital of the Borrower and its
Subsidiaries for such fiscal year, (v) an amount equal to the aggregate net
non-cash gain on the Disposition of Property by the Borrower and its
Subsidiaries during such fiscal year (other than sales of inventory in the
ordinary
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course of business), to the extent included in arriving at such
Consolidated Net Income, (vi) the net decrease during such fiscal year (if
any) in deferred tax accounts of the Borrower and its Subsidiaries, (vii)
an amount equal to the sum of all cash Restricted Payments made during such
fiscal year pursuant to Sections 7.6(b), provided that in the case of
Restricted Payments made under Section 7.6(b)(iii), only such cash Payments
made after the Closing Date shall be included, (vii) in fiscal year 2000
only, cash expense incurred by the Borrower or any of its Subsidiaries in
connection with the Acquisition and actually paid by such Person in fiscal
year 2000 in an amount not to exceed $24,500,000 and (viii) the amount of
any gain recognized as a result of any Asset Sale or Recovery Event to the
extent included in arriving at such Consolidated Net Income.
"Excess Cash Flow Application Date": as defined in Section 2.12(c).
"Excluded Foreign Subsidiary": as of the date of determination, any
Foreign Subsidiary which is a foreign corporation (within the meaning of
Section 7701(a)(5) of the Code.
"Facility": each of (a) the Tranche A Term Loan Commitments and the
Tranche A Term Loans made thereunder (the "Tranche A Term Loan Facility"),
(b) the Tranche B Term Loan Commitments and the Tranche B Term Loans made
thereunder (the "Tranche B Term Loan Facility") and (c) the Revolving
Credit Commitments and the extensions of credit made thereunder (the
"Revolving Credit Facility").
"Federal Funds Effective Rate": for any day, the weighted average of
the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published 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 which is a Business Day,
the average of the quotations for the day of such transactions received by
the Reference Lender from three federal funds brokers of recognized
standing selected by it.
"Fee Letter": the Credit Facilities Fee Letter, dated October 17,
1999, among the Sponsor, OSI, the Agents and the Arranger, as the same may
be amended, supplemented, replaced or otherwise modified from time to time
in accordance with this Agreement.
"Foreign Subsidiary": any Subsidiary of the Borrower that is not a
Domestic Subsidiary.
"Funded Debt": as to any Person, all Indebtedness of such Person of
the types described in clauses (a) through (e) of the definition of
"Indebtedness" in this Section.
"Funding Office": the office of the Administrative Agent set forth in
Section 10.2 or otherwise specified from time to time by the Administrative
Agent as its funding office by notice to the Borrower and the Lenders.
"GAAP": generally accepted accounting principles in the United States
of America as in effect from time to time, except that for purposes of
Section 7.1, GAAP shall be determined on the basis of such principles in
effect on the date hereof and
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consistent with those used in the preparation of the most recent audited
financial statements delivered pursuant to Section 4.1(b).
"Governing Documents": collectively, as to any Person, the articles or
certificate of incorporation and bylaws, any shareholders agreement,
certificate of formation, limited liability company agreement, partnership
agreement or other formation or constituent documents of such Person.
"Governmental Authority": any nation or government, any state or other
political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by Holdings, the Borrower and each
Subsidiary Guarantor, substantially in the form of Exhibit A, as the same
may be amended, supplemented, replaced or otherwise modified from time to
time in accordance with this Agreement.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to
induce the creation of which the guaranteeing person has issued a
reimbursement, counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
or other obligations (the "primary obligations") of any other third Person
(the "primary obligor") in any manner, whether directly or indirectly,
including, without limitation, any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or
any Property constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Property, securities or services
primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner
of any such primary obligation against loss in respect thereof; provided,
however, that the term Guarantee Obligation shall not include endorsements
of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee
Obligation shall be such guaranteeing person's maximum reasonably
anticipated liability in respect thereof as determined by the Borrower in
good faith.
"Hedge Agreements": all swaps, caps or collar agreements or similar
arrangements entered into by the Borrower or any of its Subsidiaries
providing for
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protection against fluctuations in interest rates or currency exchange
rates or the exchange of nominal interest obligations, either generally or
under specific contingencies.
"Holdco Stock Registration Rights Agreement": the Registration Rights
Agreement dated November 30, 1999 among Holdings, the Sponsor and the
several other parties thereto, as in effect on the date hereof.
"Holdings": as defined in the preamble hereto.
"Indebtedness": of any Person at any date, without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of Property or services (other
than trade payables incurred in the ordinary course of such Person's
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to Property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such Property), (e) all
Capital Lease Obligations or Synthetic Lease Obligations of such Person,
(f) all obligations of such Person, contingent or otherwise, as an account
party under acceptance, letter of credit or similar facilities, (g) all
obligations of such Person, contingent or otherwise, to purchase, redeem,
retire or otherwise acquire for value any Capital Stock of such Person, (h)
all Guarantee Obligations of such Person in respect of obligations of the
kind referred to in clauses (a) through (g) above; (i) all obligations of
the kind referred to in clauses (a) through (h) above secured by (or for
which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on Property (including, without
limitation, accounts and contract rights) owned by such Person, whether or
not such Person has assumed or become liable for the payment of such
obligation and (j) for the purposes of Section 8(e) only, all obligations
of such Person in respect of Hedge Agreements. The amount of any
Indebtedness under clause (j) shall be the net amount, including any net
termination payments that would be required to be paid to a counterparty on
such date, if a termination of the applicable Hedge Agreement were to occur
on such date rather than the notional amount of the applicable Hedge
Agreement.
"Indemnified Liabilities": as defined in Section 10.5.
"Indemnitee": as defined in Section 10.5.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Insurance Requirements": all material terms of any insurance policy
required pursuant to this Agreement or any Security Document and all
material regulations and then current standards applicable to or affecting
any Mortgaged Property or any part thereof or any use or condition thereof,
which may, at any time, be recommended by the
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Board of Fire Underwriters, if any, having jurisdiction over any Mortgaged
Property, or any other body exercising similar functions.
"Intellectual Property": the collective reference to all rights,
priorities and privileges relating to intellectual property, whether
arising under United States, state, multinational or foreign laws or
otherwise, including, without limitation, copyrights, patents, trademarks,
service-marks, technology, know-how and processes, formulas, trade secrets,
or licenses (under which the applicable Person is licensor or licensee)
relating to any of the foregoing and all rights to xxx at law or in equity
for any infringement or other impairment thereof, including the right to
receive all proceeds and damages therefrom.
"Intellectual Property Collateral": all Intellectual Property of the
Loan Parties, now owned or hereafter acquired, upon which a Lien is
purported to be created by the Intellectual Property Security Agreement or
the Guarantee and Collateral Agreement.
"Intellectual Property Security Agreement": the Intellectual Property
Security Agreement to be executed and delivered by each Loan Party,
substantially in the form of Exhibit B to the Guarantee and Collateral
Agreement, as the same may be amended, supplemented, replaced or otherwise
modified from time to time in accordance with this Agreement.
"Interest Payment Date" (a) as to any Base Rate Loan, the last day of
each March, June, September and December to occur while such Loan is
outstanding and the final maturity date of such Loan, (b) as to any
Eurodollar Loan having an Interest Period of three months or less, the last
day of such Interest Period, (c) as to any Eurodollar Loan having an
Interest Period longer than three months, each day which is three months,
or a whole multiple thereof, after the first day of such Interest Period
and the last day of such Interest Period and (d) as to any Loan (other than
any Revolving Credit Loan that is a Base Rate Loan (unless all Revolving
Credit Loans are being repaid in full in immediately available funds and
the Revolving Credit Commitments terminated) and any Swing Line Loan), the
date of any repayment or prepayment made in respect thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurodollar Loan and ending one, two, three or six
months thereafter, as selected by the Borrower in its Notice of Borrowing
or notice of conversion, as the case may be, given with respect thereto;
and (b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Loan and ending
one, two, three or six months thereafter, as selected by the Borrower by
irrevocable notice to the Administrative Agent not less than three Business
Days prior to the last day of the then current Interest Period with respect
thereto; provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such
Interest Period into another
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calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;
(ii) any Interest Period that would otherwise extend beyond the
Revolving Credit Termination Date or beyond the date final payment is due
on the Tranche A Term Loans or the Tranche B Term Loans, as the case may
be, shall end on the Revolving Credit Termination Date or such due date, as
applicable;
(iii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of a calendar month; and
(iv) the Borrower shall select Interest Periods so as not to require a
payment or prepayment of any Eurodollar Loan during an Interest Period for
such Loan.
"Investments": as defined in Section 7.8.
"Issuing Lender": Wachovia Bank, in its capacity as issuer of any
Letter of Credit.
"L/C Commitment": $15,000,000.
"L/C Fee Payment Date": the last day of each March, June, September
and December and the last day of the Revolving Credit Commitment Period.
"L/C Obligations": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters
of Credit and (b) the aggregate amount of drawings under Letters of Credit
that have not then been reimbursed pursuant to Section 3.5.
"L/C Participants": the collective reference to all the Revolving
Credit Lenders other than the Issuing Lender.
"Xxxxxx Entity": any of Xxxxxx Commercial Paper Inc. or any of its
affiliates (including, without limitation, Syndicated Loan Funding Trust).
"Lender Addendum": with respect to any initial Lender, a Lender
Addendum, substantially in the form of Exhibit J, to be executed and
delivered by such Lender on the Closing Date as provided in Section 10.17.
"Lenders": as defined in the preamble hereto and includes the Issuing
Lender and the Swing Line Lender.
"Letters of Credit": as defined in Section 3.1(a).
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference,
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priority or other security agreement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
"Loan": any loan made by any Lender pursuant to this Agreement.
"Loan Documents": this Agreement, the Security Documents, the Fee
Letter, the Commitment Letter, the Applications and the Notes.
"Loan Parties": the Borrower and each Subsidiary of the Borrower which
is a party to a Loan Document (including pursuant to Section 6.10).
"Majority Facility Lenders": with respect to any Facility, the holders
of more than 50% of the aggregate unpaid principal amount of the Term Loans
or the Total Revolving Extensions of Credit, as the case may be,
outstanding under such Facility (or, in the case of the Revolving Credit
Facility, prior to any termination of the Revolving Credit Commitments, the
holders of more than 50% of the Total Revolving Credit Commitments).
"Majority Revolving Credit Facility Lenders": the Majority Facility
Lenders in respect of the Revolving Credit Facility.
"Management Services Agreement": the management agreement dated
November 30, 1999 among the Borrower and Bruckmann, Xxxxxx, Xxxxxxxx & Co.,
L.L.C., as the same may be amended, supplemented, replaced or modified from
time to time.
"Management Stock Agreement": the Management Stock Agreement dated
November 30, 1999 among Holdings, the Sponsor and each of the management
stockholders as in effect on the date hereof.
"Management Subscription Agreement": the Management Subscription
Agreement dated November 30, 1999 among Holdings, the Sponsor and each of
the management stockholders, as in effect on the date hereof.
"Material Adverse Effect": a material adverse effect on or affecting
(a) the consummation of the Acquisition, (b) the business, assets,
property, management, condition (financial or otherwise), value, results of
operations or prospects of the Loan Parties taken as a whole or Holdings
and its Subsidiaries taken as a whole, or (c) the validity or
enforceability of this Agreement or any of the other Loan Documents, (d)
the validity, enforceability or priority of the Liens purported to be
created by the Security Documents, or (e) the rights or remedies of any
Agent or any Lender hereunder or under any of the other Loan Documents.
"Material Environmental Amount": an amount or amounts payable by the
Borrower and/or any of its Subsidiaries, in the aggregate in excess of
$100,000 (other than those arising in the ordinary course of business such
as wages and salaries of employees responsible for environmental matters,
permit fees, operations and
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maintenance costs associated with pollution control equipment and the costs
of administering environmental management programs), for: costs to comply
with any Environmental Law; costs of any government investigation, and any
remediation, of any Material of Environmental Concern; and compensatory
damages (including, without limitation damages to natural resources),
punitive damages, fines, and penalties pursuant to any Environmental Law.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products,
polychlorinated biphenyls, urea-formaldehyde insulation, asbestos,
pollutants, contaminants, radioactivity, and any other substances or forces
of any kind, whether or not any such substance or force is defined as
hazardous or toxic under any Environmental Law, that is regulated pursuant
to or could give rise to liability under any Environmental Law.
"Mortgaged Properties": the real properties listed on Schedule 1.1, as
to which the Administrative Agent for the benefit of the Secured Parties
shall be granted a Lien pursuant to the Mortgages.
"Mortgages": each of the mortgages and deeds of trust made by any Loan
Party in favor of, or for the benefit of, the Administrative Agent for the
benefit of the Secured Parties, substantially in the form of Exhibit D
(with such changes thereto as shall be advisable under the law of the
jurisdiction in which such mortgage or deed of trust is to be recorded), as
the same may be amended, supplemented, replaced or otherwise modified from
time to time in accordance with this Agreement.
"Multiemployer Plan": a Plan that is a multiemployer plan as defined
in Section 3(37) or 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) in connection with any Asset Sale or any
Recovery Event, the proceeds thereof in the form of cash and Cash
Equivalents (including any such proceeds received by way of deferred
payment of principal pursuant to a note or installment receivable or
purchase price adjustment receivable or otherwise, but only as and when
received) of such Asset Sale or Recovery Event, net of reasonable
attorneys' fees, accountants' fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness secured by a Lien
expressly permitted hereunder on any asset which is the subject of such
Asset Sale or Recovery Event (other than any Lien pursuant to a Security
Document) and other reasonable fees and expenses, in each case, to the
extent actually incurred in connection therewith and net of (i) taxes paid
or reasonably estimated to be payable as a result thereof (after taking
into account any available tax credits or deductions and any tax sharing
arrangements) and (ii) solely in connection with any such Asset Sale, any
reserve established in accordance with GAAP or amounts deposited in escrow
for adjustment in respect of the sale price of such asset or assets or for
indemnities with respect to any Asset Sale, provided, that any such
reserved or escrowed amounts shall be Net Cash Proceeds to the extent and
at the time released or not required to be so used and (b) in connection
with any issuance or sale of equity securities or debt securities or
instruments or the incurrence of loans, the cash proceeds received from
such issuance or incurrence, net of reasonable attorneys' fees, investment
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banking fees, accountants' fees, underwriting discounts, fees and
commissions and other reasonable fees and expenses, in each case, to the
extent actually incurred in connection therewith.
"1999 Common Stock Option Plan": the 1999 Common Stock Option Plan of
Holdings, as in effect on the date hereof.
"1999 Preferred Stock Option Plan": the 1999 Preferred Stock Option
Plan of Holdings, as in effect on the date hereof.
"Non-Excluded Taxes": as defined in Section 2.20(a).
"Non-Recourse Indebtedness": Indebtedness as to which neither Holdings
nor any of its Subsidiaries: (1)(a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute
Indebtedness), (b) is directly or indirectly liable as a guarantor or
otherwise, or (c) constitutes the lender; (2) no default with respect to
which (including any rights that the holders thereof may have to take
enforcement action against a Subsidiary) would permit upon notice, lapse of
time or both any holder of any other Indebtedness (other than the
Indebtedness incurred hereunder) of Holdings or any of its Subsidiaries to
declare a default on such other Indebtedness or cause the payment thereof
to be accelerated or payable prior to its stated maturity; and (3) as to
which the lenders thereof have been notified in writing that they will not
have any recourse to the stock or assets of Holdings or any of its
Subsidiaries.
"Non U.S. Lender": as defined in Section 2.20(f).
"Notes": the collective reference to the Revolving Credit Notes, the
Term Notes and the Swing Line Notes, if any, evidencing Loans.
"Notice of Borrowing": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit M.
"Obligations": the unpaid principal of and interest on (including,
without limitation, interest accruing after the maturity of the Loans and
Reimbursement Obligations and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to any Loan Party, whether or
not a claim for post-filing or post-petition interest is allowed in such
proceeding) the Loans and all other fees and obligations and liabilities of
the Loan Parties to the Arranger, to any Agent or to any Lender (or, in the
case of Specified Hedge Agreements, any affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in
connection with, this Agreement, any other Loan Document, the Letters of
Credit, any Specified Hedge Agreement or any other document made, delivered
or given in connection herewith or therewith, whether on account of
principal, interest, reimbursement obligations, fees, indemnities, costs,
expenses (including, without limitation, all fees, charges and
disbursements of counsel to the Arranger, to any Agent or to any Lender
that are required to be paid by any Loan Party pursuant hereto or to any
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other Loan Document) or otherwise; provided, that (i) Obligations of the
Borrower or any other Loan Party under any Specified Hedge Agreement shall
be secured and guaranteed pursuant to the Security Documents only to the
extent that, and for so long as, the other Obligations are so secured and
guaranteed and (ii) any release of Collateral or Subsidiary Guarantors
effected in the manner permitted by this Agreement shall not require the
consent of holders of obligations under Specified Hedge Agreements.
"OSI": OSI Acquisition Inc., a Delaware corporation and a Wholly Owned
Subsidiary of the Sponsor.
"Other Taxes": any and all present or future stamp or documentary
taxes or any other excise or taxes, charges or levies arising from any
payment made hereunder or from the execution, delivery or enforcement of,
or otherwise with respect to, this Agreement or any other Loan Document.
"Participant": as defined in Section 10.6(b).
"Payment Amount": as defined in Section 3.5.
"Payment Office": the office of the Administrative Agent specified in
Section 10.2 or as otherwise specified from time to time by the
Administrative Agent as its payment office by notice to the Borrower and
the Lenders.
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
"Permits": the collective reference to (i) Environmental Permits, and
(ii) any and all other franchises, licenses, leases, permits, approvals,
notifications, certifications, registrations, authorizations, exemptions,
qualifications, easements, rights of way, Liens and other rights,
privileges and approvals required under any Requirement of Law.
"Permitted Investors": the collective reference to the Sponsor and its
Control Investment Affiliates.
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of
whatever nature.
"Plan": at a particular time, any employee benefit plan that is
covered by ERISA and which the Borrower or any Commonly Controlled Entity
maintains, administers, contributes to or is required to contribute to or
within the previous five years has maintained, administered, or been
required to contribute to or under which the Borrower or any Commonly
Controlled Entity could incur any liability.
"Pledged Stock": as defined in the Guarantee and Collateral Agreement.
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27
"Preferred Stock Option Agreements": collectively, each of the
Preferred Stock Option Agreements dated November 30, 1999 between Holdings
and each of the management stockholders, in each case, as in effect on the
date hereof.
"Prepayment Option Notice": a notice executed by a Responsible Officer
substantially in the form of Exhibit H.
"Pricing Grid": the pricing grid attached hereto as Annex A.
"Private Placement Documents": The Borrower's 8.01% Senior Notes due
May 15, 2003 and all documentation relating thereto, as in effect on the
date hereof.
"Pro Forma Balance Sheet": as defined in Section 4.1(a).
"Projections": as defined in Section 6.2(c).
"Property": any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible, including, without limitation, Capital Stock.
"Purchase Agreement": the Purchase Agreement, dated November 30, 1999,
between the Borrower and Xxxxxx Brothers, Inc.
"Qualified Offering": means an offering by Holdings or any of its
Subsidiaries of its Capital Stock to the public pursuant to an underwritten
public offering or other registered offering.
"Recovery Event": any settlement of or payment in respect of any
property or casualty insurance claim or any condemnation proceeding
relating to any asset of the Borrower or any of its Subsidiaries.
"Reference Lender": Deutsche Bank.
"Refunded Swing Line Loans": as defined in Section 2.7(b).
"Refunding Date": as defined in Section 2.7(c).
"Register": as defined in Section 10.6(d).
"Registration Rights Agreement": the Registration Rights Agreement,
dated November 30, 1999, among the Borrower, X'Xxxxxxxx
Industries-Virginia, Inc. and Xxxxxx Brothers Inc.
"Regulation D": Regulation D of the Board as in effect from time to
time (and any successor to all or a portion thereof).
"Regulation H": Regulation H of the Board as in effect from time to
time (and any successor to all or a portion thereof).
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"Regulation T": Regulation T of the Board as in effect from time to
time (and any successor to all or a portion thereof).
"Regulation U": Regulation U of the Board as in effect from time to
time (and any successor to all or a portion thereof).
"Regulation X": Regulation X of the Board as in effect from time to
time (and any successor to all or a portion thereof).
"Reimbursement Obligation": the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn
under Letters of Credit.
"Reinvestment Deferred Amount": with respect to any Reinvestment
Event, the aggregate Net Cash Proceeds received by the Borrower or any of
its Subsidiaries in connection therewith that are not applied to prepay the
Term Loans or reduce the Revolving Credit Commitments pursuant to Section
2.12(b) as a result of the delivery of a Reinvestment Notice.
"Reinvestment Event": any Asset Sale or Recovery Event in respect of
which the Borrower has delivered a Reinvestment Notice.
"Reinvestment Notice": a written notice executed by a Responsible
Officer stating that no Default or Event of Default has occurred and is
continuing and that the Borrower (directly or indirectly through a Wholly
Owned Subsidiary to the extent otherwise permitted hereunder) intends and
expects to use all or a specified portion of the Net Cash Proceeds of an
Asset Sale or Recovery Event to acquire assets useful in its or such
Subsidiary's business.
"Reinvestment Prepayment Amount": with respect to any Reinvestment
Event, the Reinvestment Deferred Amount relating thereto less any amount
expended prior to the relevant Reinvestment Prepayment Date to acquire
assets useful in the Borrower's or the applicable Subsidiary's business.
"Reinvestment Prepayment Date": with respect to any Reinvestment
Event, the earlier of (a) the date occurring nine months after such
Reinvestment Event and (b) the date on which the Borrower shall have
determined not to, or shall have otherwise ceased to, acquire assets useful
in the Borrower's or the applicable Subsidiary's business with all or any
portion of the relevant Reinvestment Deferred Amount.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC
Reg. Section 4043.
"Required Lenders": at any time, the holders of more than 50% of (a)
until the Closing Date, the Commitments and (b) thereafter, the sum of (i)
the aggregate unpaid
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principal amount of the Term Loans then outstanding and (ii) the Total
Revolving Credit Commitments then in effect or, if the Revolving Credit
Commitments have been terminated, the Total Revolving Extensions of Credit
then outstanding.
"Required Prepayment Lenders": the Majority Facility Lenders in
respect of each Facility.
"Requirement of Law": as to any Person, the Governing Documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"Responsible Officer": as to any Person, the chief executive officer,
president or chief or principal financial officer of such Person, but in
any event, with respect to financial matters, the chief or principal
financial officer of such Person. Unless otherwise qualified, all
references to a "Responsible Officer" shall refer to a Responsible Officer
of the Borrower.
"Restricted Payments": as defined in Section 7.6.
"Revolving Credit Commitment": as to any Lender, the obligation of
such Lender, if any, to make Revolving Credit Loans and/or participate in
Swing Line Loans and Letters of Credit, in an aggregate principal and/or
face amount not to exceed the amount set forth under the heading "Revolving
Credit Commitment" opposite such Lender's name on Schedule 1 to the Lender
Addendum delivered by such Lender, or, as the case may be, in the
Assignment and Acceptance pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof.
"Revolving Credit Commitment Period": the period from and including
the Closing Date to the Revolving Credit Termination Date.
"Revolving Credit Lender": each Lender that has a Revolving Credit
Commitment or that is the holder of Revolving Credit Loans.
"Revolving Credit Loans": as defined in Section 2.4.
"Revolving Credit Notes": as defined in Section 2.8(e).
"Revolving Credit Percentage": as to any Revolving Credit Lender at
any time, the percentage which such Lender's Revolving Credit Commitment
then constitutes of the Total Revolving Credit Commitments (or, at any time
after the Revolving Credit Commitments shall have expired or terminated,
the percentage which the aggregate principal and/or face amount of such
Lender's Revolving Credit Extensions of Credit then outstanding constitutes
of the aggregate principal and/or face amount of the Total Revolving
Extensions of Credit then outstanding).
"Revolving Credit Termination Date": November 30, 2005.
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"Revolving Extensions of Credit": as to any Revolving Credit Lender at
any time, and amount equal to the sum of (a) the aggregate principal amount
of all Revolving Credit Loans by such Lender then outstanding, (b) such
Lender's Revolving Credit Percentage of the L/C Obligations then
outstanding and (c) such Lender's Revolving Credit Percentage of the
aggregate principal amount of Swing Line Loans then outstanding.
"SEC": the Securities and Exchange Commission (or successors thereto
or an analogous Governmental Authority).
"Secured Parties": collectively, the Arranger, the Agents, the Lenders
and, with respect to any Specified Hedge Agreement, any affiliate of any
Lender party thereto that has agreed to be bound by the provisions of
Section 7.2 of the Guarantee and Collateral Agreement as if it were a party
thereto and by the provisions of Section 9 hereof as if it were a Lender.
"Security Documents": the collective reference to the Guarantee and
Collateral Agreement, the Intellectual Property Security Agreement, the
Control Agreements, the Mortgages and all other pledge and security
documents hereafter delivered to the Administrative Agent granting a Lien
on any Property of any Person to secure the obligations and liabilities of
any Loan Party under any Loan Document.
"Senior Debt": of any Person at any date, the aggregate principal
amount of all Funded Debt of such Person that is not expressly subordinated
to other Indebtedness of such Person.
"Senior Debt Coverage Ratio": of any Person for any period, the ratio
of (a) Senior Debt of such Person for such period, to (b) Consolidated
EBITDA of such Person for such period.
"Senior Holdings Note Documentation": the Senior Holdings Note
Purchase Agreement, the warrant agreements related thereto, together with
any other instruments and agreements entered into by Holdings and its
Subsidiaries in connection therewith, as the same may be amended,
supplemented, replaced or otherwise modified from time to time in
accordance with this Agreement.
"Senior Holdings Note Purchase Agreement": the Purchase Agreement
dated as of November 30, 1999, between Holdings and the Sponsor, as the
same may be amended, supplemented, replaced or otherwise modified from time
to time in accordance with this Agreement.
"Senior Holdings Notes": the senior Purchase Agreement notes of
Holdings due 2009 in the original principal amount of $15,000,000 plus
accreted value thereon, issued from time to time pursuant to the Senior
Holdings Note Purchase Agreement.
"Senior Subordinated Note Documentation": the Senior Subordinated Note
Indenture, the Purchase Agreement, the Registration Rights Agreement, the
Unit Agreement, together with any other instruments and agreements entered
into by the
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Borrower or its Subsidiaries in connection therewith, as the same may be
amended, supplemented, replaced or otherwise modified from time to time in
accordance with this Agreement.
"Senior Subordinated Note Indenture": the Indenture, dated as of
November 30, 1999, entered into by the Borrower, certain of its
Subsidiaries, as guarantors, and Norwest Bank Minnesota, National
Association, as trustee, in connection with the issuance of the Senior
Subordinated Notes, as the same may be amended, supplemented, replaced or
otherwise modified from time to time in accordance with this Agreement.
"Senior Subordinated Notes": the senior subordinated notes of the
Borrower due 2009 issued from time to time pursuant to the Senior
Subordinated Note Indenture in aggregate principal amount not to exceed
$100,000,000 on the Closing Date.
"Single Employer Plan": any Plan that is covered by Title IV of ERISA,
but which is not a Multiemployer Plan.
"Solvency Certificate": the Solvency Certificate to be executed and
delivered by the principal financial officer of Holdings and each Loan
Party, substantially in the form of Exhibit K, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with
this Agreement.
"Solvent": when used with respect to any Person, as of any date of
determination, (a) the amount of the "present fair saleable value" of the
assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date, as
such quoted terms are determined in accordance with applicable federal and
state laws governing determinations of the insolvency of debtors, (b) the
present fair saleable value of the assets of such Person will, as of such
date, be greater than the amount that will be required to pay the liability
of such Person on its debts as such debts become absolute and matured, (c)
such Person will not have, as of such date, an unreasonably small amount of
capital with which to conduct its business, (d) such Person will be able to
pay its debts as they mature, and (e) such Person is not insolvent within
the meaning of any applicable Requirements of Law. For purposes of this
definition, (i) "debt" means liability on a "claim", and (ii) "claim" means
any (x) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right
to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.
"Specified Change of Control": a "change of control" or similar event
(howsoever defined) as defined in the Senior Subordinated Note Indenture.
"Specified Hedge Agreement": any Hedge Agreement (a) entered into by
(i) the Borrower or any of its Subsidiaries and (ii) any Lender or any
affiliate thereof, as counterparty and (b) which has been designated by
such Lender and the Borrower, by
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notice to the Administrative Agent and the Syndication Agent not later than
90 days after the execution and delivery thereof by the Borrower or such
Subsidiary, as a Specified Hedge Agreement; provided that the designation
of any Hedge Agreement as a Specified Hedge Agreement shall not create in
favor of any Lender or affiliate thereof that is a party thereto any rights
in connection with the management or release of any Collateral or of the
obligations of any Subsidiary Guarantor under the Guarantee and Collateral
Agreement.
"Sponsor": Bruckmann, Xxxxxx, Xxxxxxxx & Co., II, L.P., a Delaware
limited partnership.
"Sponsor Bid Letter": the letter, dated April 30, 1999, from
Bruckmann, Xxxxxx, Xxxxxxxx & Co., L.L.C. to the Special Committee of the
Board of Directors of Holdings.
"Stockholders Agreement": the Stockholders Agreement dated November
30, 1999 among Holdings, the Sponsor and the several other parties thereto,
as in effect on the date hereof.
"Subordinated Intercompany Note": the Subordinated Intercompany Note
to be executed and delivered by the Borrower and each of its Subsidiaries,
substantially in the form of Exhibit L, as the same may be amended,
supplemented, replaced or otherwise modified from time to time in
accordance with this Agreement.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such
other ownership interests having such power only by reason of the happening
of a contingency) to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity are at the time
owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries, or both, by such Person.
Unless otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.
"Subsidiary Guarantor": each Subsidiary of the Borrower other than any
Excluded Foreign Subsidiary.
"Swing Line Commitment": the obligation of the Swing Line Lender to
make Swing Line Loans pursuant to Section 2.6 in an aggregate principal
amount at any one time outstanding not to exceed $5,000,000.
"Swing Line Lender": Wachovia Bank, in its capacity as the lender of
Swing Line Loans.
"Swing Line Loans": as defined in Section 2.6.
"Swing Line Notes": as defined in Section 2.8(e).
"Swing Line Participation Amount": as defined in Section 2.7(c).
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"Syndication Agent": as defined in the preamble hereto.
"Synthetic Lease Obligations": all monetary obligations of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease
in respect of which such Person is the intended owner of the leased asset
for tax, bankruptcy or commercial law purposes (without regard to
accounting treatment), or (b) an agreement for the use or possession of
property creating obligations which do not appear on the balance sheet of
such Person but which, upon the insolvency or bankruptcy of such Person,
would be characterized as the Indebtedness of such Person (without regard
to accounting treatment).
"Taking": a taking or voluntary conveyance during the term of this
Agreement of all or part of any Mortgaged Property, or any interest therein
or right accruing thereto or use thereof, as the result of, or in
settlement of, any condemnation or other eminent domain proceeding by any
Governmental Authority affecting a Mortgaged Property or any portion
thereof whether or not the same shall have actually been commenced.
"Tandy Tax Sharing Agreement": the Amended and Restated Tax Benefit
Reimbursement Agreement, dated as of June 19, 1997, between Tandy
Corporation, TE Electronics Inc. and Holdings, as the same may be amended,
supplemented, replaced or otherwise modified from time to time in
accordance with this Agreement.
"Term Loan Facilities": the collective reference to the Tranche A Term
Loan Facility and the Tranche B Term Loan Facility.
"Term Loan Lenders": the collective reference to the Tranche A Term
Loan Lenders and the Tranche B Term Loan Lenders.
"Term Loans": the collective reference to the Tranche A Term Loans and
Tranche B Term Loans.
"Term Notes": as defined in Section 2.8(e).
"Title Insurance Company": as defined in Section 5.1(r).
"Total Revolving Credit Commitments": at any time, the aggregate
amount of the Revolving Credit Commitments then in effect; provided that
the amount of the Total Revolving Credit Commitments on the Closing Date
shall be $40,000,000.
"Total Revolving Extensions of Credit": at any time, the aggregate
amount of the Revolving Extensions of Credit of the Revolving Credit
Lenders outstanding at such time.
"Tranche A Term Loan": as defined in Section 2.1.
"Tranche A Term Loan Commitment": as to any Tranche A Term Loan
Lender, the obligation of such Lender, if any, to make a Tranche A Term
Loan to the Borrower hereunder in a principal amount not to exceed the
amount set forth under the heading
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"Tranche A Term Loan Commitment" opposite such Lender's name on Schedule 1
to the Lender Addendum delivered by such Lender, or, as the case may be, in
the Assignment and Acceptance pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof; provided that the original aggregate amount of the Tranche A Term
Loan Commitments is $35,000,000.
"Tranche A Term Loan Lender": each Lender that has a Tranche A Term
Loan Commitment or is the holder of a Tranche A Term Loan.
"Tranche A Term Loan Percentage": as to any Tranche A Term Loan Lender
at any time, the percentage which such Lender's Tranche A Term Loan
Commitment then constitutes of the aggregate Tranche A Term Loan
Commitments (or, at any time after the Closing Date, the percentage which
the aggregate principal amount of such Lender's Tranche A Term Loans then
outstanding constitutes of the aggregate principal amount of the Tranche A
Term Loans then outstanding).
"Tranche B Term Loan": as defined in Section 2.1.
"Tranche B Term Loan Commitment": as to any Tranche B Term Loan
Lender, the obligation of such Lender, if any, to make a Tranche B Term
Loan to the Borrower hereunder in a principal amount not to exceed the
amount set forth under the heading "Tranche B Term Loan Commitment"
opposite such Lender's name on Schedule 1 to the Lender Addendum delivered
by such Lender, or, as the case may be, in the Assignment and Acceptance
pursuant to which such Lender became a party hereto, as the same may be
changed from time to time pursuant to the terms hereof; provided that the
original aggregate amount of the Tranche B Term Loan Commitments is
$100,000,000.
"Tranche B Term Loan Lender": each Lender that has a Tranche B Term
Loan Commitment or which is the holder of a Tranche B Term Loan.
"Tranche B Term Loan Percentage": as to any Tranche B Term Loan Lender
at any time, the percentage which such Lender's Tranche B Term Loan
Commitment then constitutes of the aggregate Tranche B Term Loan
Commitments (or, at any time after the Closing Date, the percentage which
the aggregate principal amount of such Lender's Tranche B Term Loans then
outstanding constitutes of the aggregate principal amount of the Tranche B
Term Loans then outstanding); provided, that solely for purposes of
calculating the amount of each installment of Tranche B Term Loans (other
than the last installment) payable to a Term Loan Lender pursuant to
Section 2.3(b), such Term Loan Lender's Tranche B Term Loan Percentage
shall be calculated without giving effect to any portion of any prior
mandatory or optional prepayment attributable to such Term Loan Lender's
Tranche B Term Loans which shall have been declined by such Term Loan
Lender (or, in the case of any Term Loan Lender which shall have acquired
its Tranche B Term Loans by assignment from another Person, by such other
Person).
"Transferee": as defined in Section 10.14.
"Type": as to any Loan, its nature as a Base Rate Loan or a Eurodollar
Loan.
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"Unit Agreement": the Unit Agreement dated November 30, 1999, by and
among Holdings, the Borrower, X'Xxxxxxxx Industries -- Virginia, Inc. and
Norwest Bank Minnesota, National Association.
"Wholly Owned Subsidiary": as to any Person, any other Person all of
the Capital Stock of which (other than directors' qualifying shares
required by law) is owned by such Person directly and/or through other
Wholly Owned Subsidiaries.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is
a Wholly Owned Subsidiary of the Borrower.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in the other Loan Documents or any
certificate or other document made or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any certificate or
other document made or delivered pursuant hereto or thereto, accounting terms
relating to Holdings, the Borrower and its Subsidiaries not defined in Section
1.1 and accounting terms partly defined in Section 1.1, to the extent not
defined, shall have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.
(e) The expressions "payment in full," "paid in full" and any other similar
terms or phrases when used herein with respect to the Obligations shall mean the
payment in full, in immediately available funds, of all of the Obligations.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Term Loan Commitments. Subject to the terms and conditions hereof, (a)
each Tranche A Term Loan Lender severally agrees to make a term loan (a "Tranche
A Term Loan") to the Borrower on the Closing Date in an amount not to exceed the
amount of the Tranche A Term Loan Commitment of such Lender and (b) each Tranche
B Term Loan Lender severally agrees to make a term loan (a "Tranche B Term
Loan") to the Borrower on the Closing Date in an amount not to exceed the amount
of the Tranche B Term Loan Commitment of such Lender. The Term Loans may from
time to time be Eurodollar Loans or Base Rate Loans, as determined by the
Borrower and notified to the Administrative Agent in accordance with Sections
2.2 and 2.13.
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2.2 Procedure for Term Loan Borrowing. A Responsible Officer shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to 10:00 A.M., New York City time, one Business Day
prior to the anticipated Closing Date) requesting that the Term Loan Lenders
make the Term Loans on the Closing Date and specifying the amount to be
borrowed. The Terms Loans made on the Closing Date shall initially be Base Rate
Loans, and no Term Loan may be converted into or continued as a Eurodollar Loan
having an Interest Period in excess of one month prior to the date which is 60
days after the Closing Date. Upon receipt of such notice the Administrative
Agent shall promptly notify each Term Loan Lender thereof. Not later than 12:00
Noon, New York City time, on the Closing Date each Term Loan Lender shall make
available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the Term Loan or Term Loans to be made by
such Lender. The Administrative Agent shall make available to the Borrower the
aggregate of the amounts made available to the Administrative Agent by the Term
Loan Lenders in like funds.
2.3 Repayment of Term Loans.
(a) The Tranche A Term Loan of each Tranche A Lender shall mature in 23
consecutive quarterly installments, commencing on March 31, 2000, each of which
shall be in an amount equal to such Lender's Tranche A Term Loan Percentage
multiplied by the amount set forth below opposite such installment:
Installment Principal Amount
----------- ----------------
March 31, 2000 $500,000
June 30, 2000 $500,000
September 30, 2000 $500,000
December 31, 2000 $500,000
March 31, 2001 $750,000
June 30, 2001 $750,000
September 30, 2001 $750,000
December 31, 2001 $750,000
March 31, 2002 $750,000
June 30, 2002 $750,000
September 30, 2002 $750,000
December 31, 2002 $750,000
March 31, 2003 $1,250,000
June 30, 2003 $1,250,000
September 30, 2003 $1,250,000
December 31, 2003 $1,250,000
March 31, 2004 $2,500,000
June 30, 2004 $2,500,000
September 30, 2004 $2,500,000
December 31, 2004 $2,500,000
March 31, 2005 $4,000,000
June 30, 2005 $4,000,000
September 30, 2005 $4,000,000
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(b) The Tranche B Term Loan of each Tranche B Term Loan Lender shall mature
in 26 consecutive quarterly installments, commencing on March 31, 2001, each of
which shall be in an amount equal to such Lender's Tranche B Term Loan
Percentage multiplied by the amount set forth below opposite such installment:
Installment Principal Amount
----------- ----------------
March 31, 2001 $250,000
June 30, 2001 $250,000
September 30, 2001 $250,000
December 31, 2001 $250,000
March 31, 2002 $250,000
June 30, 2002 $250,000
September 30, 2002 $250,000
December 31, 2002 $250,000
March 31, 2003 $250,000
June 30, 2003 $250,000
September 30, 2003 $250,000
December 31, 2003 $250,000
March 31, 2004 $250,000
June 30, 2004 $250,000
September 30, 2004 $250,000
December 31, 2004 $250,000
March 31, 2005 $250,000
June 30, 2005 $250,000
September 30, 2005 $250,000
December 31, 2005 $250,000
March 31, 2006 $8,750,000
June 30, 2006 $8,750,000
September 30, 2006 $8,750,000
December 31, 2006 $8,750,000
March 31, 2007 $30,000,000
June 30, 2007 $30,000,000
2.4 Revolving Credit Commitments.
(a) Subject to the terms and conditions hereof, each Revolving Credit
Lender severally agrees to make revolving credit loans ("Revolving Credit
Loans") to the Borrower from time to time during the Revolving Credit Commitment
Period in an aggregate principal amount at any one time outstanding which, when
added to such Lender's Revolving Credit Percentage of the sum of (i) the L/C
Obligations then outstanding and (ii) the aggregate principal amount of the
Swing Line Loans then outstanding, does not exceed the amount of such Lender's
Revolving Credit Commitment. During the Revolving Credit Commitment Period the
Borrower may use the Revolving Credit Commitments by borrowing, prepaying the
Revolving Credit Loans in whole or in part, and reborrowing, all in accordance
with the terms and conditions hereof. The Revolving Credit Loans may from time
to time be Eurodollar Loans or Base Rate
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Loans, as determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.5 and 2.13, provided that no Revolving Credit Loan
shall be made as a Eurodollar Loan after the day that is one month prior to the
Revolving Credit Termination Date.
(b) The Borrower shall repay all outstanding Revolving Credit Loans on the
Revolving Credit Termination Date.
2.5 Procedure for Revolving Credit Borrowing. The Borrower may borrow under
the Revolving Credit Commitments during the Revolving Credit Commitment Period
on any Business Day, provided that a Responsible Officer shall give the
Administrative Agent irrevocable notice in a Notice of Borrowing (which Notice
of Borrowing must be received by the Administrative Agent prior to 12:00 Noon,
New York City time, (a) three Business Days prior to the requested Borrowing
Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the
requested Borrowing Date, in the case of Base Rate Loans), specifying (i) the
amount and Type of Revolving Credit Loans to be borrowed, (ii) the requested
Borrowing Date and (iii) in the case of Eurodollar Loans, the length of the
initial Interest Period therefor. Any Revolving Credit Loans made on the Closing
Date shall initially be Base Rate Loans, and no Revolving Credit Loan may be
made as, converted into or continued as a Eurodollar Loan having an Interest
Period in excess of one month prior to the date which is 60 days after the
Closing Date. Each borrowing under the Revolving Credit Commitments shall be in
an amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole
multiple thereof (or, if the then aggregate Available Revolving Credit
Commitments are less than $1,000,000 such lesser amount) and (y) in the case of
Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess
thereof; provided, that the Swing Line Lender may request, on behalf of the
Borrower, borrowings under the Revolving Credit Commitments which are Base Rate
Loans in other amounts pursuant to Section 2.7. Upon receipt of any such Notice
of Borrowing from the Borrower, the Administrative Agent shall promptly notify
each Revolving Credit Lender thereof. Each Revolving Credit Lender will make the
amount of its pro rata share of each borrowing available to the Administrative
Agent for the account of the Borrower at the Funding Office prior to 12:00 Noon,
New York City time, on the Borrowing Date requested by the Borrower in funds
immediately available to the Administrative Agent. Such borrowing will then be
made available to the Borrower by the Administrative Agent in like funds as
received by the Administrative Agent.
2.6 Swing Line Commitment.
(a) Subject to the terms and conditions hereof, the Swing Line Lender
agrees to make a portion of the credit otherwise available to the Borrower under
the Revolving Credit Commitments from time to time during the Revolving Credit
Commitment Period by making swing line loans ("Swing Line Loans") to the
Borrower; provided that (i) the aggregate principal amount of Swing Line Loans
outstanding at any time shall not exceed the Swing Line Commitment then in
effect (notwithstanding that the Swing Line Loans outstanding at any time, when
aggregated with the Swing Line Lender's other outstanding Revolving Credit Loans
hereunder, may exceed the Swing Line Commitment then in effect) and (ii) the
Borrower shall not request, and the Swing Line Lender shall not make, any Swing
Line Loan if, after giving effect to the making of such Swing Line Loan, the
aggregate amount of the Available Revolving Credit Commitments would be less
than zero. During the Revolving Credit Commitment Period,
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the Borrower may use the Swing Line Commitment by borrowing, repaying and
reborrowing, all in accordance with the terms and conditions hereof. Swing Line
Loans shall be Base Rate Loans only.
(b) The Borrower shall repay all outstanding Swing Line Loans on the
Revolving Credit Termination Date.
2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans.
(a) Whenever the Borrower desires that the Swing Line Lender make Swing
Line Loans a Responsible Officer shall give the Swing Line Lender irrevocable
telephonic notice confirmed promptly in writing (which telephonic notice must be
received by the Swing Line Lender not later than 1:00 P.M., New York City time,
on the proposed Borrowing Date), specifying (i) the amount to be borrowed and
(ii) the requested Borrowing Date (which shall be a Business Day during the
Revolving Credit Commitment Period). Each borrowing under the Swing Line
Commitment shall be in an amount equal to $500,000 or a whole multiple of
$100,000 in excess thereof. Not later than 3:00 P.M., New York City time, on the
Borrowing Date specified in a notice in respect of Swing Line Loans, the Swing
Line Lender shall make available to the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the amount of the Swing
Line Loan to be made by the Swing Line Lender. The Administrative Agent shall
make the proceeds of such Swing Line Loan available to the Borrower on such
Borrowing Date in immediately available funds.
(b) The Swing Line Lender, at any time and from time to time in its sole
and absolute discretion may, on behalf of the Borrower (which hereby irrevocably
directs the Swing Line Lender to act on its behalf), on one Business Day's
notice given by the Swing Line Lender no later than 12:00 Noon, New York City
time, request each Revolving Credit Lender to make, and each Revolving Credit
Lender hereby agrees to make, a Revolving Credit Loan, in an amount equal to
such Revolving Credit Lender's Revolving Credit Percentage of the aggregate
amount of the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on
the date of such notice, to repay the Swing Line Lender. Each Revolving Credit
Lender shall make the amount of such Revolving Credit Loan available to the
Administrative Agent at the Funding Office in immediately available funds, not
later than 10:00 A.M., New York City time, one Business Day after the date of
such notice. The proceeds of such Revolving Credit Loans shall be immediately
made available by the Administrative Agent to the Swing Line Lender for
application by the Swing Line Lender to the repayment of the Refunded Swing Line
Loans. The Borrower irrevocably authorizes the Swing Line Lender to charge the
Borrower's accounts with the Administrative Agent (up to the amount available in
each such account) in order to immediately pay the amount of such Refunded Swing
Line Loans to the extent amounts received from the Revolving Credit Lenders are
not sufficient to repay in full such Refunded Swing Line Loans.
(c) If prior to the time a Revolving Credit Loan would have otherwise been
made pursuant to Section 2.7(b), one of the events described in Section 8(f)
shall have occurred and be continuing with respect to the Borrower or if for any
other reason, as determined by the Swing Line Lender in its sole discretion,
Revolving Credit Loans may not be made as contemplated by Section 2.7(b), each
Revolving Credit Lender shall, on the date such Revolving
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Credit Loan was to have been made pursuant to the notice referred to in Section
2.7(b) (the "Refunding Date"), purchase for cash an undivided participating
interest in the then outstanding Swing Line Loans by paying to the Swing Line
Lender an amount (the "Swing Line Participation Amount") equal to (i) such
Revolving Credit Lender's Revolving Credit Percentage times (ii) the sum of the
aggregate principal amount of Swing Line Loans then outstanding which were to
have been repaid with such Revolving Credit Loans.
(d) Whenever, at any time after the Swing Line Lender has received from any
Revolving Credit Lender such Lender's Swing Line Participation Amount, the Swing
Line Lender receives any payment on account of the Swing Line Loans, the Swing
Line Lender will distribute to such Revolving Credit Lender its Swing Line
Participation Amount (appropriately adjusted, in the case of interest payments,
to reflect the period of time during which such Revolving Credit Lender's
participating interest was outstanding and funded and, in the case of principal
and interest payments, to reflect such Revolving Credit Lender's pro rata
portion of such payment if such payment is not sufficient to pay the principal
of and interest on all Swing Line Loans then due); provided, however, that in
the event that such payment received by the Swing Line Lender is required to be
returned, such Revolving Credit Lender will return to the Swing Line Lender any
portion thereof previously distributed to it by the Swing Line Lender.
(e) Each Revolving Credit Lender's obligation to make the Loans referred to
in Section 2.7(b) and to purchase participating interests pursuant to Section
2.7(c) shall be absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (i) any setoff, counterclaim,
recoupment, defense or other right which such Revolving Credit Lender or the
Borrower may have against the Swing Line Lender, the Borrower or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 5; (iii) any adverse change in the condition
(financial or otherwise) of the Borrower; (iv) any breach of this Agreement or
any other Loan Document by the Borrower, any other Loan Party or any other
Revolving Credit Lender; or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
2.8 Repayment of Loans; Evidence of Indebtedness.
(a) The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of the appropriate Revolving Credit Lender
or Term Loan Lender, as the case may be, (i) the then unpaid principal amount of
each Revolving Credit Loan of such Revolving Credit Lender on the Revolving
Credit Termination Date (or such earlier date on which the Loans become due and
payable pursuant to Section 8), (ii) the then unpaid principal amount of each
Swing Line Loan of such Swing Line Lender on the Revolving Credit Termination
Date (or such earlier date on which the Loans become due and payable pursuant to
Section 8) and (iii) the principal amount of each Term Loan of such Term Loan
Lender in installments according to the amortization schedule set forth in
Section 2.3 (or on such earlier date on which the Loans become due and payable
pursuant to Section 8). The Borrower hereby further agrees to pay interest on
the unpaid principal amount of the Loans from time to time outstanding from the
date hereof until payment in full thereof at the rates per annum, and on the
dates, set forth in Section 2.15.
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(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(c) The Administrative Agent, on behalf of the Borrower, shall maintain the
Register pursuant to Section 10.6(e), and a subaccount therein for each Lender,
in which shall be recorded (i) the amount of each Loan made hereunder and any
Note evidencing such Loan, the Type thereof and each 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) both
the amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender's share thereof.
(d) The entries made in the Register and the accounts of each Lender
maintained pursuant to Section 2.8(b) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement. As
between the Borrower, on the one hand, and the Lenders, on the other hand, the
Register shall, however, as provided in Section 10.6(d), be conclusive absent
manifest error as to the identity of the Person to whom the Borrower owes any
Obligations.
(e) The Borrower agrees that, upon the request to the Administrative Agent
by any Lender, the Borrower will execute and deliver to such Lender a promissory
note of the Borrower evidencing any Term Loans, Revolving Credit Loans or Swing
Line Loans, as the case may be, of such Lender, substantially in the forms of
Exhibit G-1, G-2 or G-3, respectively, with appropriate insertions as to date
and principal amount (such notes, respectively, "Term Notes", "Revolving Credit
Notes" and "Swing Line Notes").
2.9 Commitment Fees, etc.
(a) The Borrower agrees to pay to the Administrative Agent for the account
of each Revolving Credit Lender a commitment fee for the period from and
including the Closing Date to the last day of the Revolving Credit Commitment
Period, computed at the Commitment Fee Rate on the average daily amount of the
Available Revolving Credit Commitment of such Lender during the period for which
payment is made, payable quarterly in arrears on the last day of each March,
June, September and December and on the Revolving Credit Termination Date,
commencing on the first of such dates to occur after the date hereof.
(b) The Borrower agrees to pay to the Syndication Agent the fees in the
amounts and on the dates previously agreed to in writing by the Borrower and the
Syndication Agent including, without limitation, pursuant to the Fee Letter.
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(c) The Borrower agrees to pay to the Administrative Agent the fees in the
amounts and on the dates from time to time agreed to in writing by the Borrower
and the Administrative Agent including, without limitation, pursuant to the Fee
Letter.
2.10 Termination or Reduction of Revolving Credit Commitments. The Borrower
shall have the right, upon not less than three Business Days' notice to the
Administrative Agent, to terminate the Revolving Credit Commitments or, from
time to time, to reduce the amount of the Revolving Credit Commitments; provided
that no such termination or reduction of Revolving Credit Commitments shall be
permitted if, after giving effect thereto and to any prepayments of the
Revolving Credit Loans and Swing Line Loans made on the effective date thereof,
the Total Revolving Extensions of Credit would exceed the Total Revolving Credit
Commitments. Any such reduction shall be in an amount equal to $1,000,000, or a
whole multiple thereof, and shall reduce permanently the Revolving Credit
Commitments then in effect.
2.11 Optional Prepayments. The Borrower may at any time and from time to
time prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent at least three Business
Days prior thereto in the case of Eurodollar Loans and at least one Business Day
prior thereto in the case of Base Rate Loans, which notice shall specify the
date and amount of prepayment and whether the prepayment is of Eurodollar Loans
or Base Rate Loans; provided, that if a Eurodollar Loan is prepaid on any day
other than the last day of the Interest Period applicable thereto, the Borrower
shall also pay any amounts owing pursuant to Section 2.21. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof. If any such notice is given, the amount specified in such notice shall
be due and payable on the date specified therein, together with (except in the
case of Revolving Credit Loans (unless all Revolving Credit Loans are being
repaid and the Revolving Credit Commitments terminated) that are Base Rate Loans
and Swing Line Loans) accrued interest to such date on the amount prepaid and
such amount shall be applied on such date to the prepayment of the Term Loans
and the reduction of the Revolving Credit Commitments as set forth in Section
2.12(d). Partial prepayments of Term Loans and Revolving Credit Loans shall be
in an aggregate principal amount of $1,000,000 or a whole multiple thereof.
Partial prepayments of Swing Line Loans shall be in an aggregate principal
amount of $100,000 or a whole multiple thereof.
2.12 Mandatory Prepayments and Commitment Reductions.
(a) Unless the Required Prepayment Lenders shall otherwise agree, subject
to Section 2.18(d), if any Capital Stock shall be issued by Holdings or any of
its Subsidiaries pursuant to a Qualified Offering or if any Funded Debt
(excluding any Funded Debt incurred in accordance with Section 7.2 as in effect
on the date of this Agreement) shall be incurred by the Borrower or its
Subsidiaries, an amount equal to (i) in the case of Capital Stock issued
pursuant to a Qualified Offering, 50% or (ii) in the case of Funded Debt, 100%
of the Net Cash Proceeds thereof shall be applied on the date of such issuance
or incurrence toward the prepayment of the Term Loans and the reduction of the
Revolving Credit Commitments as set forth in Section 2.12(d).
(b) Unless the Required Prepayment Lenders shall otherwise agree, subject
to Section 2.18(d), if on any date the Borrower or any of its Subsidiaries shall
receive Net Cash
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Proceeds from any Asset Sale or Recovery Event then, unless a Reinvestment
Notice shall be delivered in respect thereof, such Net Cash Proceeds shall be
applied on such date toward the prepayment of the Term Loans and the reduction
of the Revolving Credit Commitments as set forth in Section 2.12(d); provided,
that, notwithstanding the foregoing, (i) the aggregate Net Cash Proceeds of
Asset Sales that may be excluded from the foregoing requirement pursuant to a
Reinvestment Notice shall not exceed $2,000,000 in any fiscal year of the
Borrower, (ii) the aggregate Net Cash Proceeds of Recovery Events that may be
excluded from the foregoing requirement pursuant to a Reinvestment Notice shall
not exceed $10,000,000 in any fiscal year of the Borrower and (iii) on each
Reinvestment Prepayment Date, an amount equal to the Reinvestment Prepayment
Amount with respect to the relevant Reinvestment Event shall be applied toward
the prepayment of the Term Loans and the reduction of the Revolving Credit
Commitments as set forth in Section 2.12(d).
(c) Unless the Required Prepayment Lenders shall otherwise agree, subject
to Section 2.18(d), if, for any fiscal year of the Borrower commencing with the
fiscal year ending June 30, 2000, there shall be Excess Cash Flow, the Borrower
shall or shall cause or the applicable Subsidiary to, on the relevant Excess
Cash Flow Application Date, apply the ECF Percentage of such Excess Cash Flow
toward the prepayment of the Term Loans as set forth in Section 2.12(d). Each
such prepayment and commitment reduction shall be made on a date (an "Excess
Cash Flow Application Date") no later than ten days after the earlier of (i) the
date on which the financial statements of the Borrower referred to in Section
6.1(a), for the fiscal year with respect to which such prepayment is made, are
required to be delivered to the Lenders and (ii) the date such financial
statements are actually delivered.
(d) Subject to Section 2.18, amounts to be applied in connection with
prepayments and Commitment reductions made pursuant to this Section 2.12 shall
be applied, first, to the prepayment of the Term Loans, second, to reduce
permanently the Revolving Credit Commitments and, third, to the Borrower or such
other Person as shall be lawfully entitled thereto. Any such reduction of the
Revolving Credit Commitments shall be accompanied by prepayment of the Revolving
Credit Loans and/or Swing Line Loans to the extent, if any, that the Total
Revolving Extensions of Credit exceed the amount of the Total Revolving Credit
Commitments as so reduced, provided that if the aggregate principal amount of
Revolving Credit Loans and Swing Line Loans then outstanding is less than the
amount of the Total Revolving Credit Commitments as so reduced (because L/C
Obligations constitute a portion thereof), the Borrower shall, to the extent of
the balance of such excess, replace outstanding Letters of Credit and/or deposit
an amount in immediately available funds in a cash collateral account
established with the Administrative Agent for the benefit of the Secured Parties
on terms and conditions satisfactory to the Administrative Agent (and the
Borrower hereby grants to the Administrative Agent, for the ratable benefit of
the Administrative Agent and the Secured Parties, a continuing security interest
in all amounts at any time on deposit in such cash collateral account to secure
all L/C Obligations from time to time outstanding and all other Obligations). If
at any time the Administrative Agent determines that any funds held in such cash
collateral account are subject to any right or claim of any Person other than
the Administrative Agent and the Secured Parties or that the total amount of
such funds is less than the amount of such excess, the Borrower shall, forthwith
upon demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in such cash collateral account, an
amount equal to the excess of (a) the amount of such excess over (b) the total
amount of funds, if any, then held in
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such cash collateral account that the Administrative Agent determines to be free
and clear of any such right and claim. The application of any prepayment
pursuant to Section 2.11 and this Section 2.12 shall be made, first, to Base
Rate Loans and, second, to Eurodollar Loans. Each prepayment of the Loans under
Section 2.11 and this Section 2.12 (except in the case of Revolving Credit Loans
(unless the Revolving Credit Loans are being repaid in full and the Revolving
Credit Commitments terminated) that are Base Rate Loans and Swing Line Loans)
shall be accompanied by accrued interest to the date of such prepayment to the
applicable Lender on the amount prepaid.
2.13 Conversion and Continuation Options.
(a) The Borrower may elect from time to time to convert Eurodollar Loans to
Base Rate Loans by giving the Administrative Agent at least two Business Days'
prior irrevocable notice of such election, provided that any such conversion of
Eurodollar Loans may only be made on the last day of an Interest Period with
respect thereto. The Borrower may elect from time to time to convert Base Rate
Loans to Eurodollar Loans by giving the Administrative Agent at least three
Business Days' prior irrevocable notice of such election (which notice shall
specify the length of the initial Interest Period therefor), provided that no
Base Rate Loan under a particular Facility may be converted into a Eurodollar
Loan (i) when any Event of Default has occurred and is continuing and the
Administrative Agent or the Majority Facility Lenders in respect of such
Facility have determined in its or their sole discretion not to permit such
conversions or (ii) after the date that is one month prior to the final
scheduled termination or maturity date of such Facility. Upon receipt of any
such notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
(b) Any Eurodollar Loan may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan under a particular Facility may be continued as such (i)
when any Event of Default has occurred and is continuing and the Administrative
Agent has or the Majority Facility Lenders in respect of such Facility have
determined in its or their sole discretion not to permit such continuations or
(ii) after the date that is one month prior to the final scheduled termination
or maturity date of such Facility, and provided, further, that if the Borrower
shall fail to give any required notice as described above in this paragraph or
if such continuation is not permitted pursuant to the preceding proviso such
Loans shall be automatically converted to Base Rate Loans on the last day of
such then expiring Interest Period. Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof.
2.14 Minimum Amounts and Maximum Number of Eurodollar Tranches.
Notwithstanding anything to the contrary in this Agreement, all borrowings,
conversions, continuations and optional prepayments of Eurodollar Loans
hereunder and all selections of Interest Periods hereunder shall be in such
amounts and be made pursuant to such elections so that, (a) after giving effect
thereto, the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of
$1,000,000 in excess thereof and (b) no more than ten Eurodollar Tranches shall
be outstanding at any one time.
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2.15 Interest Rates and Payment Dates.
(a) Each Eurodollar Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the Eurodollar
Rate determined for such day plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum equal to
the Base Rate plus the Applicable Margin.
(c) (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement
Obligations (whether or not overdue) shall bear interest at a rate per annum
that is equal to (x) in the case of the Loans, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section plus
2.0% or (y) in the case of Reimbursement Obligations, the rate applicable to
Base Rate Loans under the Revolving Credit Facility plus 2.0%, and (ii) if all
or a portion of any interest payable on any Loan or Reimbursement Obligation or
any commitment fee or other amount payable hereunder shall not be paid when due
(whether at the stated maturity, by acceleration or otherwise), such overdue
amount shall bear interest at a rate per annum equal to the rate then applicable
to Base Rate Loans under the relevant Facility plus 2.0% (or, in the case of any
such other amounts that do not relate to a particular Facility, the rate then
applicable to Base Rate Loans under the Revolving Credit Facility plus 2.0%), in
each case, with respect to clauses (i) and (ii) above, from the date of such
non-payment until such amount is paid in full (after as well as before
judgment).
(d) Interest shall be payable in arrears on each Interest Payment Date,
provided that interest accruing pursuant to paragraph (c) of this Section shall
be payable from time to time on demand.
2.16 Computation of Interest and Fees.
(a) Interest, fees and commissions payable pursuant hereto shall be
calculated on the basis of a 360-day year for the actual days elapsed, except
that, with respect to Base Rate Loans the rate of interest on which is
calculated on the basis of the Prime Rate, the interest thereon shall be
calculated on the basis of a 365-day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and the
relevant Lenders of each determination of a Eurodollar Rate. Any change in the
interest rate on a Loan resulting from a change in the Base Rate or the
Eurocurrency Reserve Requirements shall become effective as of the opening of
business on the day on which such change becomes effective. The Administrative
Agent shall as soon as practicable notify the Borrower and the relevant Lenders
of the effective date and the amount of each such change in interest rate.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 2.15(a).
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2.17 Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:
(a) the Administrative Agent shall have determined (which determination
shall be conclusive and binding upon the Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received notice from the Majority
Facility Lenders in respect of the relevant Facility that the Eurodollar Rate
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lenders (as conclusively certified by such
Lenders) of making or maintaining their affected Loans during such Interest
Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as Base Rate
Loans, (y) any Loans under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as Base Rate Loans and (z) any outstanding Eurodollar Loans under the
relevant Facility shall be converted, on the last day of the then current
Interest Period with respect thereto, to Base Rate Loans. Until such notice has
been withdrawn by the Administrative Agent, no further Eurodollar Loans under
the relevant Facility shall be made or continued as such, nor shall the Borrower
have the right to convert Loans under the relevant Facility to Eurodollar Loans.
2.18 Pro Rata Treatment and Payments.
(a) Each borrowing by the Borrower from the Lenders hereunder, each payment
by the Borrower on account of any commitment fee and any reduction of the
Commitments of the Lenders shall be made pro rata according to the respective
Tranche A Term Loan Percentages, Tranche B Term Loan Percentages, or Revolving
Credit Percentages, as the case may be, of the relevant Lenders. Subject to
Section 2.18(c), each payment (other than prepayments) in respect of principal
or interest in respect of the Loans, and each payment in respect of fees or
expenses payable hereunder shall be applied to the amounts of such obligations
owing to the Lenders pro rata according to the respective amounts then due and
owing to the Lenders. The application of any prepayment pursuant to this Section
2.18 shall be made, first, to Base Rate Loans and, second, to Eurodollar Loans.
(b) Each mandatory prepayment required by Section 2.12 to be applied to
Term Loans shall be allocated among the Term Loan Facilities pro rata according
to the respective outstanding principal amounts of Term Loans under such
Facilities. Each optional prepayment in respect of the Term Loans shall be
allocated among the Term Loan Facilities pro rata according to the respective
outstanding principal amounts of Term Loans under such Facilities. Each payment
(including each prepayment) of the Term Loans outstanding under any Term Loan
Facility shall be allocated among the Term Loan Lenders holding such Term Loans
pro rata based on the principal amount of such Term Loans held by such Term Loan
Lenders, and shall be applied to the installments of such Term Loans pro rata
based on the remaining
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outstanding principal amount of such installments. Amounts prepaid on account of
the Term Loans may not be reborrowed.
(c) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Credit Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans then held by the Revolving Credit Lenders. Each payment in respect
of Reimbursement Obligations in connection with any Letter of Credit shall be
made to the Issuing Lender.
(d) Notwithstanding anything to the contrary in Sections 2.11 or 2.12 or
this Section 2.18, so long as any Tranche A Term Loans are outstanding, each
Tranche B Term Loan Lender may, at its option, decline up to 100% of the portion
of any optional prepayment or mandatory payment applicable to the Tranche B Term
Loans of such Lender; accordingly, with respect to the amount of any optional
prepayment described in Section 2.11 or mandatory prepayment described in
Section 2.12 that is allocated to Tranche B Term Loans (such amounts, the
"Tranche B Prepayment Amount"), at any time when Tranche A Term Loans remain
outstanding, the Borrower will, (i) in the case of any optional prepayment which
the Borrower wishes to make, not later than 10 Business Days prior to the date
on which the Borrower wishes to make such optional prepayment, and (ii) in the
case of any mandatory prepayment required to be made pursuant to Section 2.12,
in lieu of applying such amount to the prepayment of Tranche B Term Loans as
provided in Sections 2.12(d) and 2.18(b), on the date specified in Section 2.12
for such prepayment, (x) deposit such amount in a cash collateral account opened
by the Administrative Agent pending application of such amount in accordance
with this Section 2.18(d), and (y) give the Administrative Agent telephonic
notice (promptly confirmed in writing) requesting that the Administrative Agent
prepare and provide to each Tranche B Term Loan Lender a Prepayment Option
Notice as described below. As promptly as practicable after receiving such
notice from the Borrower, the Administrative Agent will send to each Tranche B
Term Loan Lender a Prepayment Option Notice, which shall include an offer by the
Borrower to prepay on the date (each a "Prepayment Date") that is 10 Business
Days after the date of the Prepayment Option Notice, the relevant Term Loans of
such Lender by an amount equal to the portion of the Prepayment Amount indicated
in such Lender's Prepayment Option Notice as being applicable to such Lender's
Tranche B Term Loans. On the Prepayment Date, (i) the Administrative Agent shall
apply from the amount deposited in the cash collateral account pursuant to this
Section 2.18(d), the aggregate amount necessary to prepay that portion of the
outstanding relevant Term Loans in respect of which Tranche B Term Loan Lenders
have accepted prepayment as described above (such Lenders, the "Accepting
Lenders"), and such amount shall be applied to reduce the Tranche B Prepayment
Amounts with respect to each Accepting Lender and (ii) the Administrative Agent
shall apply from the amount deposited in the cash collateral account pursuant to
this Section 2.18(d) an amount equal to 100% of the portion of the Tranche B
Prepayment Amount not accepted by the Tranche B Term Loan Lenders, and such
amount shall be applied to the prepayment of the Tranche A Term Loans. The
Borrower hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a continuing security interest in all amounts at any time
on deposit in such cash collateral account to secure all Obligations from time
to time outstanding.
(e) All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without
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setoff or counterclaim and shall be made prior to 12:00 Noon, New York City
time, on the due date thereof to the Administrative Agent, for the account of
the Lenders, at the Payment Office, in Dollars and in immediately available
funds. The Administrative Agent shall distribute such payments to the Lenders
promptly upon receipt in like funds as received. If any payment hereunder (other
than payments on the Eurodollar Loans) becomes due and payable on a day other
than a Business Day, such payment shall be extended to the next succeeding
Business Day. If any payment on a Eurodollar Loan becomes due and payable on a
day other than a Business Day, the maturity thereof shall be extended to the
next succeeding Business Day unless the result of such extension would be to
extend such payment into another calendar month, in which event such payment
shall be made on the immediately preceding Business Day. In the case of any
extension of any payment of principal pursuant to the preceding two sentences,
interest thereon shall be payable at the then applicable rate during such
extension.
(f) Unless the Administrative Agent shall have been notified in writing by
any Lender prior to a borrowing that such Lender will not make the amount that
would constitute its share of such borrowing available to the Administrative
Agent, the Administrative Agent may assume that such Lender is making such
amount available to the Administrative Agent, and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower a corresponding
amount. If such amount is not made available to the Administrative Agent by the
required time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a rate
equal to the daily average Federal Funds Effective Rate for the period until
such Lender makes such amount immediately available to the Administrative Agent.
A certificate of the Administrative Agent submitted to any Lender with respect
to any amounts owing under this paragraph shall be conclusive in the absence of
manifest error. If such Lender's share of such borrowing is not made available
to the Administrative Agent by such Lender within three Business Days of such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to Base Rate Loans
under the relevant Facility, on demand, from the Borrower.
(g) Subject to Section 2.18(d) unless the Administrative Agent shall have
been notified in writing by the Borrower prior to the date of any payment being
made hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Lenders their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days of
such required date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available pursuant
to the preceding sentence, such amount with interest thereon at the rate per
annum equal to the daily average Federal Funds Effective Rate. Nothing herein
shall be deemed to limit the rights of the Administrative Agent or any Lender
against the Borrower.
2.19 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law (other than
a Requirement of Law relating to Taxes, which shall be dealt with under Section
2.20) or in the
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interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:
(i) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender that is not otherwise included in the determination
of the Eurodollar Rate hereunder; or
(ii) shall impose on such Lender any other condition; and the result
of any of the foregoing is to increase the cost to such Lender, by an
amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such
Lender, upon its demand, any additional amounts necessary to compensate
such Lender on an after-tax basis for such increased cost or reduced amount
receivable. If any Lender becomes entitled to claim any additional amounts
pursuant to this Section, it shall promptly notify the Borrower (with a
copy to the Administrative Agent) of the event by reason of which it has
become so entitled.
(b) If any Lender shall have determined that the adoption of or any change
in any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender's or such corporation's capital as a consequence of its obligations
hereunder or under or in respect of any Letter of Credit to a level below that
which such Lender or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then from time to time, after submission by such
Lender to the Borrower (with a copy to the Administrative Agent) of a written
request therefor, the Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender on an after-tax basis for such
reduction.
(c) A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.20 Taxes.
(a) All payments made by the Borrower under this Agreement or any other
Loan Document shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or
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assessed by any Governmental Authority, excluding net income taxes and any other
taxes imposed on or measured by net income or capital, imposed on the Arranger,
any Agent or any Lender as a result of a present or former connection between
the Arranger, such Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from the
Arranger's, such Agent's or such Lender's having executed, delivered or
performed its obligations or received a payment under, or enforced, this
Agreement or any other Loan Document). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to the Arranger,
any Agent or any Lender hereunder, the amounts so payable to the Arranger, such
Agent or such Lender shall be increased to the extent necessary to yield to the
Arranger, such Agent or such Lender (after payment of all Non-Excluded Taxes)
interest or any such other amounts that would have been received hereunder had
such withholding not been required; provided, however, that the Borrower or a
Subsidiary Guarantor shall not be required to increase any such amounts payable
to the Arranger, any Agent or any Lender with respect to any Non-Excluded Taxes
(i) that are attributable to the Arranger's, such Agent's or such Lender's
failure to comply with the requirements of paragraph (f) of this Section, or
(ii) that are United States withholding taxes imposed on amounts payable to the
Arranger, such Agent or such Lender at the time the Arranger, such Agent or such
Lender becomes a party to this Agreement, except to the extent that the
Arranger's, such Agent's or such Lender's assignor (if any) was entitled, at the
time of assignment, to receive additional amounts from the Borrower or a
Subsidiary Guarantor with respect to such Non-Excluded Taxes pursuant to this
Section 2.20(a). The Borrower or the applicable Subsidiary Guarantor shall make
any required withholding and pay the full amount withheld to the relevant tax
authority or other Governmental Authority in accordance with applicable
Requirements of Law.
(b) The Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable Requirements of Law.
(c) The Borrower shall indemnify the Arranger, each Agent and any Lender
for the full amount of Non-Excluded Taxes which were not grossed up under
Section 2.20(a) (other than as a result of the application of the proviso in the
second sentence thereof) or Other Taxes arising in connection with payments made
under this Agreement (including, without limitation, any Non-Excluded Taxes
which were not grossed up under Section 2.20(a) or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 2.20) paid by the Arranger,
such Agent or Lender or any of their respective Affiliates and any liability
(including penalties, additions to tax interest and expenses) arising therefrom
or with respect thereto. Payment under this indemnification shall be made within
ten days from the date the Arranger, any Agent or any Lender or any of their
respective Affiliates makes written demand therefor; provided, however, that the
Borrower shall not be obligated to make payment to the Arranger, any Agent or
any Lender (as the case may be) pursuant to this Section 2.20(c) in respect of
penalties, interest and other liabilities attributable to any Non-Excluded Taxes
or Other Taxes, if (i) written demand therefor has not been made by the
Arranger, such Agent or such Lender within 60 days from the date on which the
Arranger, such Agent or such Lender received written notice of the imposition of
Non-Excluded Taxes or Other Taxes by the relevant taxing or Governmental
Authority, but only to the extent such penalties, interest and other similar
liabilities are solely attributable to such failure or delay by the Arranger,
such Agent or such
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Lender in making such written demand and only if the Borrower is not (and is not
required by law to be) notified of such imposition, (ii) such penalties,
interest and other liabilities have accrued more than 10 days after the Borrower
has indemnified or paid in full an additional amount due as of the date of such
payment pursuant to this Section 2.20(c) as a result of the Arranger's, such
Agent's or the Lender's (as the case may be) failure to pay an amount due to the
appropriate taxing authorities or (iii) such penalties, interest and other
liabilities are attributable solely to the gross negligence or willful
misconduct of the Arranger, such Agent or such Lender or such Affiliates as
determined by a final and nonappealable decision of a court of competent
jurisdiction.
(d) Whenever any Non-Excluded Taxes or Other Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for the account of the Arranger or the relevant Agent or
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower or, if such receipt is not available, other evidence of
payment reasonably acceptable to the Administration Agent showing payment
thereof.
(e) The agreements in this Section 2.20 shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
(f) Each Lender (or Transferee), except to the extent not legally able to
do so, will deliver to the Borrower or the Administrative Agent (or, in the case
of a Participant, to the Lender from which the related participation was
purchased), (i) if it is not a citizen or resident of the United States of
America, a corporation, partnership or other entity created or organized in or
under the laws of the United States of America (or any jurisdiction thereof), or
any estate or trust that is subject to federal income taxation regardless of the
source of its income (a "Non U.S. Lender") two copies of either U.S. Internal
Revenue Service Form 1001 or Form 4224 (or a Form W-8 with equivalent effect, as
permitted by the transitional rules of the Treasury Regulations issued under
Section 1441 of the Code in October 1997 and generally effective on January 1,
2001), or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of "portfolio interest," a statement substantially in the form of
Exhibit I to the effect that such Lender is eligible for a complete exemption
from withholding of U.S. taxes under Section 871(h) or 881(c) of the Code and a
Form W-8, or any subsequent versions thereof or successors thereto properly
completed and duly executed by such Non-U.S. Lender claiming complete exemption
from, or a reduced rate of, U.S. federal withholding tax on all payments by the
Borrower under this Agreement and the other Loan Documents, or (ii) if it is not
a Non-U.S. Lender and is not an individual or entity exempt from back up
withholding tax (including, without limitation, a corporation and a tax-exempt
entity) two properly completed and duly executed copies of U.S. Internal Revenue
Service Form W-9, certifying that it is exempt from backup withholding under
Section 3406 of the Code. Such forms shall be delivered by each applicable
Lender on or before the date it becomes a party to this Agreement (or, in the
case of any Participant, on or before the date such Participant purchases the
related participation). In addition, each applicable Lender or Participant shall
deliver such forms promptly upon the obsolescence or invalidity of any form
previously delivered by such Lender. Each Lender shall promptly notify the
Borrower (and each Participant shall notify the Lender from which it purchased
such participation) at any time it determines that it is no longer in a position
to provide any previously delivered certificate to the
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Borrower (or, in the case of a Participant, to the Lender from which it
purchased its participation) (or any other form of certification adopted by the
U.S. taxing authorities for such purpose).
(g) If and to the extent that any Lender is able, in its sole opinion, to
apply or otherwise take advantage of any offsetting tax credit or other similar
tax benefit arising out of or in conjunction with any deduction or withholding
which gives rise to an obligation on the Borrower to pay any Taxes or Other
Taxes pursuant to this Section 2.20 then such Lender shall, to the extent that
in its sole opinion it can do so without prejudice to the retention of the
amount of such credit or benefit and without any other adverse tax consequences
for such Lender, reimburse to the Borrower at such time as such tax credit or
benefit shall have actually been received by such Lender such amount as such
Lender shall, in its sole opinion, have determined to be attributable to the
relevant deduction or withholding and as will leave such Lender in no better or
worse position than it would have been in if the payment of such Taxes or Other
Taxes had not been required. Nothing in this Section 2.20 shall oblige any
Lender to disclose to the Borrower or any other Person any information regarding
its tax affairs or tax computations or interfere with the right of any Lender to
arrange its tax affairs in whatever manner it thinks fit and, in particular, no
Lender shall be under any obligation to claim relief from its corporate profits
or similar tax liability in credits or deductions available to it and, if it
does so claim, the extent, order and manner in which it does so shall be at its
absolute discretion.
(h) A Lender that is entitled to an exemption from or reduction of non-U.S.
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 under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
2.21 Indemnity. The Borrower agrees to indemnify each Lender and to hold
each Lender harmless from any loss or expense that such Lender may sustain or
incur as a consequence of (a) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans after the Borrower has given
a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement or (c) the making of a prepayment or conversion of Eurodollar Loans on
a day that is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest that would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender) that
would have accrued to such Lender on such amount by placing such amount on
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deposit for a comparable period with leading banks in the interbank eurodollar
market. A certificate as to any amounts payable pursuant to this Section
submitted to the Borrower by any Lender shall be conclusive in the absence of
manifest error. This covenant shall survive the termination of this Agreement
and the payment of the Loans and Letters of Credit and all other amounts payable
hereunder.
2.22 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be canceled and (b)
such Lender's Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs on
a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 2.21.
2.23 Change of Lending Office. Each Lender agrees that, upon the occurrence
of any event giving rise to the operation of Section 2.19, 2.20(a) or 2.22 with
respect to such Lender, it will, if requested by the Borrower, use reasonable
efforts (subject to overall policy considerations of such Lender) to designate
another lending office for any Loans affected by such event with the object of
avoiding the consequences of such event; provided, that such designation is made
on terms that, in the sole judgment of such Lender, cause such Lender and its
lending office(s) to suffer no economic, legal or regulatory disadvantage, and
provided, further, that nothing in this Section shall affect or postpone any of
the obligations of any Borrower or the rights of any Lender pursuant to Section
2.19, 2.20(a) or 2.22.
2.24 Replacement of Lenders under Certain Circumstances. The Borrower shall
be permitted to replace any Lender that (a) requests reimbursement for amounts
owing pursuant to Section 2.19, 2.20(a) or 2.22 or (b) defaults in its
obligation to make Loans hereunder, with a replacement financial institution;
provided that (i) such replacement does not conflict with any Requirement of
Law, (ii) no Event of Default shall have occurred and be continuing at the time
of such replacement, (iii) prior to any such replacement, such Lender shall have
taken no action under Section 2.23 so as to eliminate the continued need for
payment of amounts owing pursuant to Section 2.19, 2.20(a) or 2.22, (iv) the
replacement financial institution shall purchase, at par, all Loans and other
amounts owing to such replaced Lender on or prior to the date of replacement,
(v) the Borrower shall be liable to such replaced Lender under Section 2.21 (as
though Section 2.21 were applicable) if any Eurodollar Loan owing to such
replaced Lender shall be purchased other than on the last day of the Interest
Period relating thereto, (vi) the replacement financial institution, if not
already a Lender, shall be reasonably satisfactory to the Administrative Agent,
(vii) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 10.6 (provided that the Borrower shall
be obligated to pay the registration and processing fee referred to therein),
(viii) until such time as such replacement shall be consummated, the Borrower
shall pay all additional amounts (if any) required pursuant to Section 2.19,
2.20(a) or 2.22, as the case may be, and (ix) any such
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replacement shall not be deemed to be a waiver of any rights that the Borrower,
the Administrative Agent or any other Lender shall have against the replaced
Lender.
SECTION 3. LETTERS OF CREDIT
3.1 L/C Commitment.
(a) Subject to the terms and conditions hereof, the Issuing Lender, in
reliance on the agreements of the other Revolving Credit Lenders set forth in
Section 3.4(a), agrees to issue standby and trade letters of credit ("Letters of
Credit") for the account of the Borrower on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the
aggregate amount of the Available Revolving Credit Commitments would be less
than zero. Each Letter of Credit shall (i) be denominated in Dollars and (ii)
expire no later than the earlier of (x) the first anniversary of its date of
issuance and (y) the date which is five Business Days prior to the Revolving
Credit Termination Date, provided that any Letter of Credit with a one-year term
may provide for the renewal thereof for additional one-year periods (which shall
in no event extend beyond the date referred to in clause (y) above).
(b) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit hereunder if such issuance would conflict with, or cause the
Issuing Lender or any L/C Participant to exceed any limits imposed by, any
applicable Requirement of Law.
3.2 Procedure for Issuance of Letter of Credit. The Borrower may from time
to time request that the Issuing Lender issue a Letter of Credit by delivering
to the Issuing Lender at its address for notices specified herein an Application
therefor, completed to the satisfaction of the Issuing Lender, and such other
certificates, documents and other papers and information as the Issuing Lender
may request. Upon receipt of any Application, the Issuing Lender will process
such Application and the certificates, documents and other papers and
information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent, which shall
in turn promptly furnish to the Lenders, notice of the issuance of each Letter
of Credit (including the amount thereof).
3.3 Fees and Other Charges.
(a) The Borrower will pay a fee on the aggregate drawable amount of each
outstanding Letter of Credit at a per annum rate equal to the Applicable Margin
then in effect with respect to Eurodollar Loans under the Revolving Credit
Facility, shared ratably among the
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Revolving Credit Lenders and payable quarterly in arrears on each L/C Fee
Payment Date after the issuance date of such Letter of Credit. In addition, the
Borrower shall pay to the Issuing Lender for its own account a fronting fee on
the aggregate drawable amount of each outstanding Letter of Credit of 1/4 of 1%
per annum, payable quarterly in arrears on each L/C Fee Payment Date after the
issuance date of such Letter of Credit.
(b) In addition to the foregoing fees, the Borrower shall pay or reimburse
the Issuing Lender for such normal and customary costs and expenses as are
incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.
3.4 L/C Participations.
(a) The Issuing Lender irrevocably agrees to grant and hereby grants to
each L/C Participant, and, to induce the Issuing Lender to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase
and hereby accepts and purchases from the Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant's own account and risk
an undivided interest equal to such L/C Participant's Revolving Credit
Percentage in the Issuing Lender's obligations and rights under each Letter of
Credit issued hereunder and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant unconditionally and irrevocably agrees with the
Issuing Lender that, if a draft is paid under any Letter of Credit for which the
Issuing Lender is not reimbursed in full by the Borrower in accordance with the
terms of this Agreement, such L/C Participant shall pay to the Issuing Lender,
regardless of the occurrence or continuance of a Default or an Event of Default
or the failure to satisfy any of the other conditions specified in Section 5,
upon demand, at the Issuing Lender's address for notices specified herein an
amount equal to such L/C Participant's Revolving Credit Percentage of the amount
of such draft, or any part thereof, that is not so reimbursed.
(b) If any amount required to be paid by any L/C Participant to the Issuing
Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any
payment made by the Issuing Lender under any Letter of Credit is paid to the
Issuing Lender within three Business Days after the date such payment is due,
such L/C Participant shall pay to the Issuing Lender on demand an amount equal
to the product of (i) such amount, times (ii) the daily average Federal Funds
Effective Rate during the period from and including the date such payment is
required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to Section
3.4(a) is not made available to the Issuing Lender by such L/C Participant
within three Business Days after the date such payment is due, the Issuing
Lender shall be entitled to recover from such L/C Participant, on demand, such
amount with interest thereon calculated from such due date at the rate per annum
applicable to Base Rate Loans under the Revolving Credit Facility. A certificate
of the Issuing Lender submitted to any L/C Participant with respect to any
amounts owing under this Section shall be conclusive in the absence of manifest
error.
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(c) Whenever, at any time after the Issuing Lender has made payment under
any Letter of Credit and has received from any L/C Participant its pro rata
share of such payment in accordance with Section 3.4(a), the Issuing Lender
receives any payment related to such Letter of Credit (whether directly from the
Borrower or otherwise, including proceeds of collateral applied thereto by the
Issuing Lender), or any payment of interest on account thereof, the Issuing
Lender will distribute to such L/C Participant its pro rata share thereof;
provided, however, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.
3.5 Reimbursement Obligation of the Borrower. The Borrower agrees to
reimburse the Issuing Lender on each date on which the Issuing Lender notifies
the Borrower of the date and amount of a draft presented under any Letter of
Credit and paid by the Issuing Lender for the amount of (a) such draft so paid
and (b) any taxes (other than taxes based on the net income of the Issuing
Lender), fees, charges or other costs or expenses incurred by the Issuing Lender
in connection with such payment (the amounts described in the foregoing clauses
(a) and (b) in respect of any drawing, collectively, the "Payment Amount"). Each
such payment shall be made to the Issuing Lender at its address for notices
specified herein in lawful money of the United States of America and in
immediately available funds. Interest shall be payable on each Payment Amount
from the date of the applicable drawing until payment in full at the rate set
forth in (i) until the second Business Day following the date of the applicable
drawing, Section 2.15(b) and (ii) thereafter, Section 2.15(c). Each drawing
under any Letter of Credit shall (unless an event of the type described in
clause (i) or (ii) of Section 8(f) shall have occurred and be continuing with
respect to the Borrower, in which case the procedures specified in Section 3.4
for funding by L/C Participants shall apply) constitute a request by the
Borrower to the Administrative Agent for a borrowing pursuant to Section 2.5 of
Base Rate Loans (or, at the option of the Administrative Agent and the Swing
Line Lender in their sole discretion, a borrowing pursuant to Section 2.7 of
Swing Line Loans) in the amount of such drawing. The Borrowing Date with respect
to such borrowing shall be the first date on which a borrowing of Revolving
Credit Loans (or, if applicable, Swing Line Loans) could be made, pursuant to
Section 2.5 (or, if applicable, Section 2.7), if the Administrative Agent had
received a notice of such borrowing at the time of such drawing under such
Letter of Credit.
3.6 Obligations Absolute. The Borrower's obligations under this Section 3
shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment that the Borrower
may have or have had against the Issuing Lender, any beneficiary of a Letter of
Credit or any other Person. The Borrower also agrees with the Issuing Lender
that the Issuing Lender shall not be responsible for, and the Borrower's
Reimbursement Obligations under Section 3.5 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or among the Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of the Borrower against any
beneficiary of such Letter of Credit or any such transferee. The Issuing Lender
shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Issuing Lender under or in connection with
any
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Letter of Credit or the related drafts or documents, if done in accordance with
the standards or care specified in the Uniform Commercial Code of the State of
New York, shall be binding on the Borrower and shall not result in any liability
of the Issuing Lender to the Borrower.
3.7 Letter of Credit Payments. If any draft shall be presented for payment
under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
3.8 Applications. To the extent that any provision of any Application
related to any Letter of Credit is inconsistent with the provisions of this
Section 3, the provisions of this Section 3 shall apply.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Arranger, the Agents and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, the Borrower (and, as to Sections 4.3 through 4.6, 4.8 and 4.21 only,
Holdings) hereby represent and warrant to the Arranger, each Agent and each
Lender that:
4.1 Financial Condition.
(a) The unaudited pro forma consolidated balance sheet of Holdings and its
consolidated Subsidiaries as at June 30, 1999 (including the notes thereto) (the
"Pro Forma Balance Sheet"), copies of which have heretofore been furnished to
each Lender, has been prepared giving effect (as if such events had occurred on
such date) to (i) the consummation of the Acquisition, (ii) the Loans to be made
on the Closing Date, the Senior Subordinated Notes to be issued pursuant to the
Senior Subordinated Note Indenture, the note or notes to be issued pursuant to
the Senior Holdings Note Purchase Agreement and the use of proceeds of each
thereof and (iii) the payment of fees and expenses in connection with the
foregoing. The Pro Forma Balance Sheet has been prepared based on the best
information available to the Borrower as of the date of delivery thereof and on
good faith estimates and assumptions reasonably believed by it to be reasonable
as of the date of delivery thereof, and presents fairly on a pro forma basis the
estimated financial position of Holdings and its consolidated Subsidiaries as at
June 30, 1999, assuming that the events specified in the preceding sentence had
actually occurred at such date.
(b) The audited consolidated balance sheets of Holdings and its
consolidated Subsidiaries as at June 30, 1997, June 30, 1998 and June 30, 1999
and the related consolidated statements of income and of cash flows for the
fiscal years ended on such dates, reported on by and accompanied by an
unqualified report from PriceWaterhouse Coopers LLP, present fairly the
consolidated financial condition of Holdings and its consolidated Subsidiaries
as at such date, and the consolidated results of its operations and its
consolidated cash flows for the respective fiscal years then ended. All such
financial statements, including the related schedules and notes
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thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein). Holdings and its Subsidiaries do not have
any material Guarantee Obligations, contingent liabilities and liabilities for
taxes for the covered periods, or any long-term leases or unusual forward or
long-term commitments, including, without limitation, any interest rate or
foreign currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph. During the period from June 30, 1999 to and
including the date hereof there has been no Disposition by Holdings or its
Subsidiaries of any material part of its respective businesses or Properties.
4.2 No Change. Since June 30, 1999, there has been no development or event
that has had or could reasonably be expected to have a Material Adverse Effect.
4.3 Corporate Existence; Compliance with Law. Each of Holdings, the
Borrower and its Subsidiaries (a) is duly organized, validly existing and in
good standing (to the extent such concept exists under applicable Requirements
of Law) under the laws of the jurisdiction of its organization, (b) has the
corporate power and authority, and the legal right, to own and operate its
Property, to lease the Property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of Property or the conduct of its business
requires such qualification except where the failure to be so qualified could
not reasonably be expected to have a Material Adverse Effect (to the extent such
concept exists under applicable Requirements of Law) and (d) is in compliance
with all Requirements of Law except to the extent that the failure to comply
therewith could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
4.4 Corporate Power; Authorization; Enforceable Obligations. Holdings and
each Loan Party has the corporate power and authority, and the legal right, to
make, deliver and perform the Loan Documents and Acquisition Documentation to
which it is a party and, in the case of the Borrower, to borrow hereunder.
Holdings and each Loan Party has taken all necessary corporate action to
authorize the execution, delivery and performance of the Loan Documents and
Acquisition Documentation to which it is a party and, in the case of the
Borrower, to authorize the borrowings on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the Acquisition and the borrowings hereunder or with the
execution, delivery, performance, validity or enforceability of this Agreement,
any of the Loan Documents or any Acquisition Documentation, except (i) consents,
authorizations, filings and notices described in Schedule 4.4, which consents,
authorizations, filings and notices have been obtained or made and are in full
force and effect, (ii) the filings referred to in Section 4.19 and (iii) other
consents, authorizations, filings and notices by or in respect of Persons other
than any Governmental Authority which could not reasonably be expected to have a
Material Adverse Effect. Each Loan Document and Acquisition Documentation to
which Holdings or any Loan Party is a party has been duly executed and delivered
on behalf of each such Person. This Agreement constitutes, and each other Loan
Document and Acquisition Documentation to which Holdings or any Loan Party is a
party upon execution will constitute, a legal, valid and binding obligation of
each such Person, enforceable against each such Person in accordance with its
terms, except as enforceability may
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be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).
4.5 No Legal Bar. The execution, delivery and performance of this
Agreement, the other Loan Documents, the Senior Subordinated Note Documentation,
the Senior Holdings Note Documentation and the Acquisition Documentation, the
issuance of Letters of Credit, the borrowings hereunder and the use of the
proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of Holdings, the Borrower or any of its Subsidiaries and will not
result in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any Requirement of Law or any such
Contractual Obligation (other than the Liens created by the Security Documents).
No Requirement of Law or Contractual Obligation applicable to Holdings, the
Borrower or any of its Subsidiaries could reasonably be expected to have a
Material Adverse Effect.
4.6 No Material Litigation. No litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending or, to the
knowledge of the Borrower, threatened by or against Holdings, OSI, the Borrower
or any of its Subsidiaries or against any of their respective properties or
revenues (a) with respect to any of the Loan Documents or the Acquisition
Documentation or any of the transactions contemplated hereby or thereby, or (b)
that could reasonably be expected to have a Material Adverse Effect.
4.7 No Default. Neither Holdings, the Borrower nor any of its Subsidiaries
is in default under or with respect to any of its Contractual Obligations in any
respect that could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default presently exists.
4.8 Ownership of Property; Liens. Each of the Borrower and its Subsidiaries
has good and, subject to the purchase options described on Schedule 7.3(f)
hereof, indefeasible title in fee simple to, or a valid leasehold interest in,
all its real property, and good title to, or a valid leasehold interest in, all
its other Property, and none of such Property is subject to any Lien except as
permitted by Section 7.3. Holdings has good title to its Pledged Stock. None of
the Pledged Stock is subject to any Lien except for non-consensual Liens
permitted by Section 7.3 to the extent arising by operation of law.
4.9 Intellectual Property. The Borrower and each of its Subsidiaries owns,
or is licensed or otherwise has the right to use, all Intellectual Property
necessary for the conduct of its business as currently conducted, except for any
Intellectual Property the failure of which to own, license or otherwise have the
right to use could not reasonably be expected to have a Material Adverse Effect.
No material claim has been asserted in writing or is pending by any Person
challenging or questioning the use of any Intellectual Property or the validity
or effectiveness of any Intellectual Property, nor does the Borrower know of any
valid basis for any such claim. To the best knowledge of the Borrower, the use
of Intellectual Property by the Borrower and its Subsidiaries does not infringe
on the rights of any Person in any manner that could reasonably be expected to
have a Material Adverse Effect.
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4.10 Taxes. Each of Holdings, the Borrower and each of its Subsidiaries has
filed or caused to be filed all Federal, state and other material tax returns
that are required to be filed and has paid all taxes shown to be due and payable
on said returns or on any assessments made against it or any of its Property and
all other taxes, fees or other charges imposed on it or any of its Property by
any Governmental Authority (other than any (i) the amount or validity of which
are currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of Holdings, the Borrower or its Subsidiaries, as the case may be, or (ii)
in respect of which the applicable statute of limitations has expired and no
further claims for payment thereof, or for any interest or penalties thereon,
may be brought under applicable law); the contents of all such material tax
returns are correct and accurate in all material respects, no tax Lien has been
filed, and, to the knowledge of the Borrower, no claim is being asserted, with
respect to any such tax, fee or other charge except for Liens that would be
permitted under Section 7.3(a).
4.11 Federal Regulations. No part of the proceeds of the Loans or Letters
of Credit will be used for purchasing or carrying any "margin stock" (within the
meaning of Regulation U) or for the purpose of purchasing, carrying or trading
in any securities under such circumstances as to involve the Borrower in a
violation of Regulation X or to involve any broker or dealer in a violation of
Regulation T. No indebtedness being reduced or retired out of the proceeds of
the Loans or Letters of Credit was or will be incurred for the purpose of
purchasing or carrying any "margin stock" (within the meaning of Regulation U).
Following application of the proceeds of the Loans and Letters of Credit,
"margin stock" (within the meaning of Regulation U) does not constitute more
than 25% of the value of the assets of Holdings, the Borrower and its
Subsidiaries. None of the transactions contemplated by this Agreement
(including, without limitation, the direct and indirect use of proceeds of the
Loans and Letters of Credit) will violate or result in a violation of Regulation
T, Regulation U or Regulation X. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1 referred to in Regulation U.
4.12 Labor Matters. There are no strikes, stoppages, slowdowns or other
labor disputes against the Borrower or any of its Subsidiaries pending or, to
the knowledge of the Borrower, threatened that (individually or in the
aggregate) could reasonably be expected to have a Material Adverse Effect. Hours
worked by and payment made to employees of the Borrower and its Subsidiaries
have not been in violation of the Fair Labor Standards Act or any other
applicable Requirement of Law dealing with such matters that (individually or in
the aggregate) could reasonably be expected to have a Material Adverse Effect.
All payments due from the Borrower or any of its Subsidiaries on account of
employee health and welfare insurance that (individually or in the aggregate)
could reasonably be expected to have a Material Adverse Effect if not paid have
been paid or accrued as a liability on the books of the Borrower or the relevant
Subsidiary.
4.13 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
complies and has complied in all material respects with all applicable
provisions of ERISA and the Code. No termination of a Single
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Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. The present value of all accrued benefits
under each Single Employer Plan (based on those assumptions used to fund such
Plans) did not, as of the last annual valuation date prior to the date on which
this representation is made or deemed made, exceed the value of the assets of
such Plan allocable to such accrued benefits by a material amount. Neither the
Borrower nor any Commonly Controlled Entity has had a complete or partial
withdrawal from any Multiemployer Plan that has resulted or could reasonably be
expected to result in a material liability under ERISA, and neither the Borrower
nor any Commonly Controlled Entity would become subject to any material
liability under ERISA if the Borrower or any such Commonly Controlled Entity
were to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. No such Multiemployer Plan is in Reorganization or Insolvent.
4.14 Investment Company Act; Other Regulations. None of Holdings or any
Loan Party is an "investment company", or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended. None of Holdings or any Loan Party is subject to regulation under
any Requirement of Law (other than Regulation X) which limits or conditions its
ability to incur Indebtedness.
4.15 Subsidiaries.
(a) The Subsidiaries listed on Schedule 4.15 constitute all the
Subsidiaries of Holdings and of the Borrower as of the Closing Date after giving
effect to the Acquisition. Schedule 4.15 sets forth as of the Closing Date and
after giving effect to the Acquisition, the name and jurisdiction of
incorporation of each Subsidiary of Holdings and the Borrower and, as to each
such Subsidiary, the percentage and number of each class of Capital Stock owned
by Holdings, the Borrower and its Subsidiaries.
(b) There are no outstanding subscriptions, options, warrants, calls,
rights or other agreements or commitments (other than stock options granted to
employees or directors and directors' qualifying shares) of any nature relating
to any Capital Stock of the Borrower or any Subsidiary. None of the Borrower or
any of its Subsidiaries has issued, or authorized the issuance of, any
Disqualified Stock.
4.16 Use of Proceeds. The proceeds of the Term Loans shall be used to
finance a portion of the Acquisition and to pay related fees and expenses. The
proceeds of the Revolving Credit Loans and the Swing Line Loans, and the Letters
of Credit, shall be used to finance the working capital needs and for general
corporate purposes of the Borrower and its Subsidiaries in the ordinary course
of business.
4.17 Environmental Matters. Except as disclosed on Schedule 4.17 and other
exceptions to any of the following that could not, individually or in the
aggregate, reasonably be expected to result in the payment of a Material
Environmental Amount:
(a) The Borrower and its Subsidiaries: (i) are, and within the period of
all applicable statutes of limitation have been, in compliance in all material
respects with all applicable Environmental Laws; and (ii) reasonably believe
that compliance with any
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Environmental Law that is or is expected to become applicable to any of them
will be timely attained and maintained, without material expense.
(b) Materials of Environmental Concern are not present at, on, under, in,
or about any real property now or formerly owned, leased or operated by the
Borrower or any of its Subsidiaries, or at any other location (including,
without limitation, any location to which Materials of Environmental Concern
have been sent for re-use or recycling or for treatment, storage, or disposal)
which could reasonably be expected to (i) give rise to liability of the Borrower
or any of its Subsidiaries under any applicable Environmental Law or otherwise
result in costs to the Borrower or any of its Subsidiaries, or (ii) interfere
with the Borrower's or any of its Subsidiaries' continued operations, or (iii)
impair the fair saleable value of any real property owned or leased by the
Borrower or any of its Subsidiaries.
(c) There is no judicial, administrative, or arbitral proceeding (including
any notice of violation or alleged violation) under or relating to any
Environmental Law to which the Borrower or any of its Subsidiaries is, or to the
knowledge of the Borrower will be, named as a party that is pending or, to the
knowledge of the Borrower, threatened.
(d) Neither the Borrower nor any of its Subsidiaries has received any
written request for information, or been notified that it is a potentially
responsible party under or relating to the federal Comprehensive Environmental
Response, Compensation, and Liability Act or any similar Environmental Law, or
with respect to any Materials of Environmental Concern.
(e) Neither the Borrower nor any of its Subsidiaries has entered into or
agreed to any consent decree, order, or settlement or other agreement, or is
subject to any judgment, decree, or order or other agreement, in any judicial,
administrative, arbitral, or other forum for dispute resolution, relating to
compliance with or liability under any Environmental Law.
(f) Neither the Borrower nor any of its Subsidiaries has assumed or
retained, by contract or operation of law, any liabilities of any kind, fixed or
contingent, known or unknown, under any Environmental Law or with respect to any
Material of Environmental Concern.
(g) To the best of the Borrower's knowledge, there are no written
environmental assessments conforming to the standards of the ASTM "Standard
Practice for Environmental Assessments: Phase I Environmental Site Assessment
Process" that have been prepared as to the Collateral other than those delivered
to the Administrative Agent pursuant to Section 5.1(l).
4.18 Accuracy of Information, etc. No statement or information contained in
this Agreement, any other Loan Document, the Confidential Information Memorandum
or any other document, certificate or statement furnished to the Arranger, the
Administrative Agent, the Syndication Agent or the Lenders or any of them, by or
on behalf of Holdings, OSI, the Sponsor, Bruckmann, Xxxxxx, Xxxxxxxx & Co.,
L.C.C., the Borrower or any of its Subsidiaries for use in connection with the
transactions contemplated by this Agreement or the other Loan Documents,
contained as of the date such statement, information, document or certificate
was so furnished (or, in the case of the Confidential Information Memorandum, as
of the date of this Agreement),
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any untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements contained herein or therein not
misleading. The projections and pro forma financial information contained in the
materials referenced above are based upon good faith estimates and assumptions
believed by management of the Borrower to be reasonable at the time made, it
being recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount. As of the Closing
Date, the representations and warranties contained in the Acquisition
Documentation are true and correct in all material respects. There is no fact
known to Holdings, OSI, the Sponsor, Bruckmann, Xxxxxx, Xxxxxxxx & Co., L.C.C.,
the Borrower or any of its Subsidiaries that could reasonably be expected to
have a Material Adverse Effect that has not been expressly disclosed herein, in
the other Loan Documents, in the Confidential Information Memorandum or in any
other documents, certificates and written statements furnished to the Arranger,
the Agents and the Lenders for use in connection with the transactions
contemplated hereby and by the other Loan Documents.
4.19 Security Documents.
(a) The Guarantee and Collateral Agreement is effective to create in favor
of the Administrative Agent, for the benefit of the Secured Parties, a legal,
valid and enforceable security interest in the Collateral described therein and
proceeds and products thereof. In the case of the Pledged Stock, when any stock
certificates representing such Pledged Stock are delivered to the Administrative
Agent, and in the case of the other Collateral described in the Guarantee and
Collateral Agreement, when financing statements in appropriate form are filed in
the offices specified on Schedule 4.19(a)-1 (which financing statements have
been duly completed and executed in accordance with applicable Requirements of
Law and delivered to the Administrative Agent for filing) and such other filings
as are specified on Schedule 3 to the Guarantee and Collateral Agreement are
made (all of which filings have been duly completed and executed in accordance
with applicable Requirements of Law and delivered to the Administrative Agent
for filing), the Guarantee and Collateral Agreement shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
Holdings and the Loan Parties in such Collateral and the proceeds and products
thereof, as security for the Obligations (as defined in the Guarantee and
Collateral Agreement), in each case prior and superior in right to any other
Person (except, in the case of Collateral other than Pledged Stock, Liens
permitted by Section 7.3 and, in the case of Collateral consisting of Pledged
Stock, non-consensual Liens permitted by Section 7.3 to the extent arising by
operation of law). Schedule 4.19(a)-2 lists each UCC Financing Statement that
(i) names any Holdings or Loan Party as debtor and (ii) will remain on file
after the Closing Date. Schedule 4.19(a)-3 lists each UCC Financing Statement
that (i) names Holdings or any Loan Party as debtor and (ii) will be terminated
on or prior to the Closing Date; and on or prior to the Closing Date, the
Borrower will have delivered to the Administrative Agent, or caused to be filed,
duly completed UCC termination statements, signed by the relevant secured party,
in respect of each such UCC Financing Statement.
(b) Each of the Mortgages is effective to create in favor of the
Administrative Agent, for the benefit of the Secured Parties, a legal, valid and
enforceable Lien on the Mortgaged Properties described, and as defined, therein
and proceeds and products thereof, and when the Mortgages are filed in the
offices specified on Schedule 4.19(b), each such Mortgage
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shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Loan Parties in the Mortgaged Properties and the
proceeds and products thereof, as security for the Obligations (as defined in
the relevant Mortgage), in each case prior and superior in right to any other
Person except for Liens, rights and other interests permitted under Section 7.3.
(c) The Intellectual Property Security Agreement is effective to create in
favor of the Administrative Agent, for the benefit of the Secured Parties, a
legal, valid and enforceable security interest in the Intellectual Property
Collateral described therein and proceeds and products thereof. Upon the filing
and recording of (i) the Intellectual Property Security Agreement in the
appropriate indexes of the United States Patent and Trademark Office relative to
patents and trademarks (within three (3) months after the Closing Date), and the
United States Copyright Office relative to copyrights (within thirty (30) days
after the Closing Date), together with provision for payment of all requisite
fees, and (ii) financing statements in appropriate form for filing in the
offices specified on Schedule 4.19(c) (which financing statements have been duly
completed and executed in accordance with applicable Requirements of Law and
delivered to the Administrative Agent for filing) the Intellectual Property
Security Agreement shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in the
Intellectual Property Collateral and the proceeds and products thereof, as
security for the Obligations (as defined in the Guarantee and Collateral
Agreement), in each case prior and superior in right to any other Person (except
non-consensual Liens permitted by Section 7.3 to the extent arising by operation
of law).
4.20 Solvency. Holdings and each Loan Party is, and after giving effect to
the Acquisition and the incurrence of all Indebtedness and obligations being
incurred in connection with the Loan Documents and the Acquisition will be and
will continue to be, Solvent.
4.21 Senior Indebtedness. The Obligations (including, without limitation,
the guarantee obligations of each Subsidiary Guarantor under the Guarantee and
Collateral Agreement) constitute "Senior Debt," "Designated Senior Debt" and
"Permitted Debt" under and as defined in the Senior Subordinated Note Indenture.
4.22 Regulation H. No Mortgage encumbers improved real property which is
located in an area that has been identified by the Secretary of Housing and
Urban Development as an area having special flood hazards and in which flood
insurance has been made available under the National Flood Insurance Act of
1968.
4.23 Year 2000 Matters. Any reprogramming required to permit the proper
functioning, in and following the year 2000, of (i) the Borrower's and each of
its Subsidiaries' computer systems which are material to the operation of the
business of the Borrower or any of its Subsidiaries and (ii) equipment
containing embedded microchips which are material to the operation of the
business of the Borrower or any of its Subsidiaries (including systems and
equipment supplied by others or with which the Borrower's or any of its
Subsidiaries' systems interface) and the testing of all such systems and
equipment, as so reprogrammed, will be completed by December 30, 1999. The cost
to the Borrower and its Subsidiaries of such reprogramming and testing and of
the reasonably foreseeable consequences of year 2000 to the Borrower and its
Subsidiaries (including, without limitation, reprogramming errors and the
failure of others' systems or equipment) could not reasonably be expected to
result in a Default
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or a Material Adverse Effect. Except for such of the reprogramming referred to
in the preceding sentence as may be necessary, the computer and management
information systems of the Borrower and its Subsidiaries which are material to
the operation of the business of the Borrower or any of its Subsidiaries are
and, with ordinary course upgrading and maintenance, will continue to be,
sufficient to permit the Borrower and its Subsidiaries to conduct its business
without Material Adverse Effect.
4.24 Insurance. Each of the Borrower and its Subsidiaries is insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which it
is engaged; and none of the Borrower or any of its Subsidiaries (i) has received
notice from any insurer or agent of such insurer that substantial capital
improvements or other material expenditures will have to be made in order to
continue such insurance or (ii) has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers at a cost that could not
reasonably be expected to have a Material Adverse Effect.
4.25 Acquisition Documentation. The Acquisition Documentation listed on
Schedule 4.25 attached hereto constitute all of the material agreements,
instruments and undertakings to which Holdings, the Sponsor, Bruckmann, Xxxxxx,
Xxxxxxxx & Co., L.C.C., OSI, the Borrower or any of its Subsidiaries is bound or
by which such Person or any of its property or assets is bound or affected
relating to, or arising out of, the Acquisition (including, without limitation,
any agreements, instruments or undertakings assumed pursuant to the Acquisition
Agreement). None of such material agreements, instruments or undertakings have
been amended, supplemented or otherwise modified, and all such material
agreements, instruments and undertakings are in full force and effect. None of
Holdings or any Loan Party which is party to any Acquisition Documentation is
currently in default thereunder and no party thereto, or any other Person, has
the right to terminate any Acquisition Documentation. The Borrower has disclosed
to the Lenders (i) all matters disclosed by Holdings to OSI, its agents,
advisers or affiliates as a result of any of their searches or inquires made as
of the date of the Acquisition Agreement, and (ii) all matters disclosed by
Holdings or any of its directors, officers, employees, agents, advisers or
affiliates to OSI, its agents, advisers or affiliates, each of which matters is
deemed by the terms of the Acquisition Documentation to qualify the otherwise
stated terms of such Acquisition Documentation (the disclosures pursuant to
clauses (i) and (ii), collectively, the "Disclosed Matters"). The Disclosed
Matters could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
4.26 Mortgaged Properties.
(a) Each Mortgaged Property is in compliance with all applicable
Requirements of Law (including building and zoning ordinances and codes) and
with all Insurance Requirements, except where noncompliance could not reasonably
be expected to have a Material Adverse Effect.
(b) No Taking has been commenced or, to the best of the Borrower's
knowledge, is contemplated with respect to all or any portion of the applicable
Mortgaged Property or for the relocation of roadways providing access to such
Mortgaged Property.
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(c) There are no pending or, to the best knowledge of the Borrower,
proposed special or other assessments for public improvements or otherwise
affecting any Mortgaged Property, nor are there any contemplated improvements to
such Mortgaged Property that may result in such special or other assessments.
(d) None of the Borrower or any of its Subsidiaries has suffered, permitted
or initiated the joint assessment of any Mortgaged Property with any other real
property constituting a separate tax lot. Each Mortgaged Property is comprised
of one or more parcels, each of which constitutes a separate tax lot and none of
which constitutes a portion of any other tax lot.
(e) Each of the Borrower and its Subsidiaries has obtained all permits,
licenses, variances and certificates required by Requirements of Law to be
obtained by such Person and necessary to the use and operation of each Mortgaged
Property except in each case where the failure to have obtained the same could
not reasonably be expected to have a Material Adverse Effect. The use being made
of each Mortgaged Property is in conformity with the certificate of occupancy
and/or such other permits, licenses, variances and certificates for such
Mortgaged Property and any other restrictions, covenants or conditions affecting
such Mortgaged Property except in each case where the failure to have obtained
the same could not reasonably be expected to have a Material Adverse Effect.
(f) Each Mortgaged Property is free from structural defects and all
building systems contained therein are in good working order and condition,
ordinary wear and tear excepted, and are suitable for the purposes for which
they are currently being used except in each case where the failure to meet such
standards could not reasonably be expected to have a Material Adverse Effect.
(g) Except as permitted by Section 7.3, no Person has any possessory
interest in any Mortgaged Property or right to occupy any Mortgaged Property
except the Borrower. There are no outstanding options to purchase or rights of
first refusal or restrictions on transferability affecting any Mortgaged
Property except as set forth on Schedule 7.3(f).
(h) Each Mortgaged Property has adequate rights of access to public ways
and is served by public utilities necessary to the continued use and enjoyment
of each Mortgaged Property as used and enjoyed on the Closing Date. Except for
public streets and sidewalks, none of the Borrower or any of its Subsidiaries
uses or occupies any real property other than such Mortgaged Property in
connection with the use and operation of any Mortgaged Property.
(i) No building or structure constituting a Mortgaged Property or any
appurtenance thereto or equipment thereon, or the operation or maintenance
thereof, violates any restrictive covenant or encroaches on any easement or on
any property owned by others, which violation or encroachment materially
interferes with the use or could materially adversely affect the value of such
building, structure or appurtenance or which encroachment is necessary for the
operation of the business at any Mortgaged Property. All buildings, structures,
appurtenances and equipment necessary for the use of each Mortgaged Property for
the purpose for which it is currently being used are located on the real
property encumbered by such Mortgage.
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(j) As of the Closing Date, each Mortgaged Property is located within an
area having a Zone Designation C by the Federal Emergency Management Agency and
does not lie within the 100 year Flood Plain, as shown on the current and
applicable Flood Insurance Rate Map for the community in which each such
Mortgaged Property is situated.
4.27 Permits.
(a) Other than exceptions to any of the following that could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect (or, in the case of Environmental Permits, result in the payment
of a Material Environmental Amount), both before and after consummation of the
Acquisition: (i) each of the Borrower and its Subsidiaries has obtained and
holds all Permits required for any property owned, leased or otherwise operated
by or on behalf of, or for the benefit of, such Person and for the operation of
each of its businesses as presently conducted and as proposed to be conducted,
(ii) all such Permits are in full force and effect, and each of the Borrower and
its Subsidiaries has performed and observed all requirements of such Permits,
(iii) no event has occurred which allows or results in, or after notice or lapse
of time would allow or result in, revocation or termination by the issuer
thereof or in any other impairment of the rights of the holder of any such
Permit, (iv) no such Permits contain any restrictions, either individually or in
the aggregate, that are materially burdensome to the Borrower or any of its
Subsidiaries, or to the operation of any of its businesses or any property
owned, leased or otherwise operated by such Person, (v) each of the Borrower and
its Subsidiaries reasonably believes that each of its Permits will be timely
renewed and complied with, without material expense, and that any additional
Permits that may be required of such Person will be timely obtained and complied
with, without material expense, and (vi) the Borrower has no knowledge or reason
to believe that any Governmental Authority is considering limiting, suspending,
revoking or renewing on materially burdensome terms any such Permit.
(b) Both before and after giving effect to the Acquisition, no consent or
authorization of, filing with, Permit from, or other act by or in respect of,
any Governmental Authority is required in connection with the execution,
delivery, performance, validity or enforceability of, or enforcement of remedies
(including, without limitation, foreclosure on the Collateral) pursuant to, this
Agreement and the other Loan Documents other than consents and approvals of, and
Permits (other than Environmental Permits) issued by, Governmental Authorities
required in connection with any foreclosure on the Collateral pursuant to the
Security Documents.
4.28 Lease Payments. Both before and after giving effect to the
Acquisition, each of the Borrower and its Subsidiaries has paid all payments
required to be made by it under leases of real property where any of the
Collateral is or may be located from time to time (other than any the amount or
validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of the Borrower or such Subsidiary, as the case may be);
to the Borrower's knowledge, no landlord Lien has been filed, and, to the
knowledge of the Borrower, no claim is being asserted, with respect to any such
payments.
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SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Initial Extension of Credit. The agreement of each Lender
to make the initial extension of credit requested to be made by it is subject to
the satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent:
(a) Loan Documents. The Administrative Agent shall have received (i) this
Agreement, executed and delivered by a duly authorized officer of the Borrower,
(ii) the Guarantee and Collateral Agreement, executed and delivered by a duly
authorized officer of Holdings, the Borrower and each Subsidiary Guarantor,
(iii) the Intellectual Property Security Agreement, executed and delivered by a
duly authorized officer of the Borrower and each Subsidiary Guarantor, (iv) each
Acknowledgment and Consent, executed and delivered by a duly authorized officer
of the Issuer (as defined in the Guarantee and Collateral Agreement) party
thereto, (v) a Mortgage covering each of the Mortgaged Properties, executed and
delivered by a duly authorized officer of each Loan Party party thereto, (vi)
the Subordinated Intercompany Note, executed and delivered by a duly authorized
officer of the Borrower and each of its Subsidiaries, and (vii) if requested by
any Lender, for the account of such Lender, Notes conforming to the requirements
hereof and executed and delivered by a duly authorized officer of the Borrower.
(b) Acquisition, etc. The following transactions shall have been
consummated, in each case on terms and conditions reasonably satisfactory to the
Lenders:
(i) the Acquisition shall have been consummated for an aggregate
purchase price not exceeding $358,100,000 (including fees and expenses not
exceeding $24,500,000 in the aggregate) pursuant to, and in strict
compliance with, Acquisition Documentation satisfactory to the Lenders, and
no provision thereof shall have been waived, amended, supplemented or
otherwise modified;
(ii) Holdings shall (a) have received not less than $58,900,000 in
cash or contributed capital from the issuance of its Capital Stock (other
than Disqualified Stock) to the Sponsor, or its Affiliates, or by the
retention of its Capital Stock by members of the management of Holdings and
its Subsidiaries, (b) have received not less than $24,600,000 in gross cash
proceeds from the issuance of preferred Capital Stock of Holdings, in each
case, on terms reasonably satisfactory to the Lenders, and (c) have
received not less than $15,000,000 in gross cash proceeds from the issuance
of the Senior Holdings Notes pursuant to, and in compliance with, the
Senior Holdings Note Purchase Agreement, and all such proceeds shall have
been contributed as a capital contribution in cash to the Borrower (it
being understood that the terms and conditions on Exhibit A to the Sponsor
Bid Letter are satisfactory);
(iii) the capital structure of Holdings and each Loan Party
immediately after the Acquisition shall be as described in Schedule 4.15;
and
(iv) each of the conditions precedent to the issuance of the Senior
Subordinated Notes pursuant to the Senior Subordinated Note Documentation
shall have
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been satisfied in strict compliance with the terms thereof, and no
provision thereof shall have been waived, amended, supplemented or
otherwise modified in a manner that could be materially adverse to any
Agent or any Lender, and the Borrower shall have received at least
$98,000,000 in gross cash proceeds from the issuance of the Senior
Subordinated Notes.
(c) Pro Forma Balance Sheet; Financial Statements. The Lenders shall have
received (a) the Pro Forma Balance Sheet, (b) audited consolidated financial
statements of Holdings and its consolidated Subsidiaries for the 1997, 1998 and
1999 fiscal years and (c) unaudited interim consolidated financial statements of
Holdings and its consolidated Subsidiaries for each fiscal month and quarterly
period ended subsequent to the date of the latest applicable financial
statements delivered pursuant to clause (b) of this paragraph as to which such
financial statements are available, and such financial statements shall not, in
the reasonable judgment of the Lenders, reflect any material adverse change in
the consolidated financial condition of Holdings and its Subsidiaries, as
reflected in the financial statements or projections contained in the
Confidential Information Memorandum.
(d) Approvals. All governmental and third party approvals (including
landlords' and other consents) necessary or, in the reasonable discretion of the
Administrative Agent, advisable in connection with the Acquisition, the
continuing operations of the Borrower and its Subsidiaries and the transactions
contemplated hereby or by the Acquisition Documentation shall have been obtained
and be in full force and effect, and all applicable waiting periods shall have
expired without any action being taken or threatened by any competent authority
which would restrain, prevent or otherwise impose adverse conditions on the
Acquisition or the financing contemplated hereby or by the Senior Subordinated
Note Documentation or the Senior Holdings Note Documentation.
(e) Related Agreements. The Administrative Agent shall have received (in a
form and substance reasonably satisfactory to the Administrative Agent), with a
copy for each Lender, true and correct copies, certified as to authenticity by
the Borrower, of such documents or instruments as may be reasonably requested by
the Syndication Agent and the Administrative Agent, including, without
limitation, a copy of the Senior Subordinated Note Documentation, the Senior
Holdings Note Documentation and any other debt instrument, security agreement or
other material contract to which Holdings or any Loan Party may be a party.
(f) Termination of Private Placement Documents. The Administrative Agent
shall have received evidence satisfactory to the Administrative Agent and the
Syndication Agent that the Private Placement Documents shall be terminated and
all amounts thereunder shall be paid in full, in each case, concurrently with
the initial extension of credit hereunder.
(g) Fees and Other Obligations. The Lenders, the Arranger, the Syndication
Agent and the Administrative Agent shall have received all fees and expenses
required to be paid (including, without limitation, the reasonable fees,
disbursements and other charges of counsel to the Agents), on or before the
Closing Date, and the Sponsor, OSI and Holdings shall have complied with all of
their obligations under the Commitment Letter and the Fee Letter. All such
amounts will be paid with proceeds of Loans made on the Closing Date and will be
reflected in
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the funding instructions given by the Borrower to the Administrative Agent on or
before the Closing Date.
(h) Business Plan. The Administrative Agent on behalf of each Lender shall
have received a business plan of the Borrower and its Subsidiaries satisfactory
to each Lender for calendar years 1999 through and including 2007.
(i) Solvency. The Lenders shall have received a Solvency Certificate
executed by the principal financial officer of Holdings, the Borrower and each
Subsidiary Guarantor, as the case may be, which shall document the solvency of
Holdings, the Borrower and each Subsidiary Guarantor after giving effect to the
Acquisition and the transactions contemplated hereby.
(j) Budget. The Lenders shall have received a budget for the Borrower and
its Subsidiaries for the 2000 fiscal year.
(k) Lien Searches. The Administrative Agent shall have received the results
of a recent lien, tax lien, judgment and litigation search in each of the
jurisdictions or offices (including, without limitation, in the United States
Patent and Trademark Office and the United States Copyright Office) in which
Uniform Commercial Code financing statements or other filings or recordations
should be made to evidence or perfect (with the priority required under the Loan
Documents) security interests in all Property of the Loan Parties and in the
Capital Stock of the Borrower, and such search shall reveal no Liens on any of
the assets of the Borrower or its Subsidiaries or on any Collateral except for
(i) in the case of assets or Collateral other than Pledged Stock, Liens
permitted by Section 7.3, (ii) in the case of assets or Collateral consisting of
Pledged Stock, non-consensual Liens permitted by Section 7.3 to the extent
arising by operation of law, or (iii) Liens set forth on Schedule 4.19(a)-3.
(l) Environmental Matters. The Administrative Agent shall have received,
with a copy for each Lender, any written environmental assessments conforming to
the standards of the ASTM "Standard Practice for Environmental Assessments:
Phase I Environmental Site Assessment Process" that have been prepared as to any
of the Collateral and that are in the Borrower's possession.
(m) Closing Certificate. The Administrative Agent shall have received a
certificate of Holdings and each Loan Party, dated as of the Closing Date,
substantially in the form of Exhibit C, with appropriate insertions and
attachments.
(n) Other Certifications. The Administrative Agent shall have received the
following:
(i) a copy of the charter of Holdings and each of its Subsidiaries and
each amendment thereto, certified (as of a date reasonably near the date of
the initial extension of credit) as being a true and correct copy thereof
by the Secretary of State or other applicable Governmental Authority of the
jurisdiction in which each such Person is organized;
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(ii) a copy of a certificate of the Secretary of State or other
applicable Governmental Authority of the jurisdiction in which each such
Person is organized, dated reasonably near the date of the initial
extension of credit, listing the charter of Holdings and each of its
Subsidiaries and each amendment thereto on file in such office and
certifying that (a) such amendments are the only amendments to such
Person's charter on file in such office, (b) such Person has paid all
franchise taxes to the date of such certificate and (c) such Person is duly
organized and in good standing (to the extent such concept exists) under
the laws of such jurisdiction; and
(iii) a copy of a certificate of the Secretary of State or other
applicable Governmental Authority of each jurisdiction in which Holdings
and each of its Subsidiaries is required to be qualified as a foreign
corporation or entity, dated reasonably near the date of the initial
extension of credit, stating that Holdings and each of its Subsidiaries is
duly qualified and in good standing as a foreign corporation or entity in
each such jurisdiction and has filed all annual reports required to be
filed to the date of such certificate; and telephonic confirmation from the
Secretary of State or other applicable Governmental Authority of each such
jurisdiction on the date of the initial extension of credit as to the due
qualification and continued good standing of each such Person as a foreign
corporation or entity in each such jurisdiction on or about such date,
together with a written confirmatory report in respect thereof prepared by,
or on behalf of, a filing service acceptable to the Administrative Agent.
(o) Opinions. The Administrative Agent shall have received the following
executed legal and other opinions:
(i) the legal opinion of Xxxxxxxx & Xxxxx, special counsel to Holdings
and its Subsidiaries, substantially in the form of Exhibit F-1;
(ii) each opinion (including, without limitation, each legal opinion,
solvency opinion and fairness opinion), if any, delivered in connection
with the Acquisition Agreement, which opinions shall provide for the
reliance thereon by the Agents and the Lenders; and
(iii) the legal opinion of local counsel in each of Missouri, Virginia
and Utah of such other special and local counsel as may be reasonably
requested by the Administrative Agent.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.
(p) Pledged Stock, Stock Power; Pledged Notes. The Administrative Agent
shall have received (i) the certificates representing the shares of Capital
Stock pledged pursuant to the Guarantee and Collateral Agreement, together with
an undated stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof and (ii) each promissory note
(including the Subordinated Intercompany Note) pledged to the Administrative
Agent pursuant to the Guarantee and Collateral Agreement endorsed (without
recourse) in blank
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(or accompanied by an executed transfer form in blank satisfactory to the
Administrative Agent) by the pledgor thereof.
(q) Filings, Registrations and Recordings. Each document (including,
without limitation, any Uniform Commercial Code financing statement) required by
the Security Documents or under law or reasonably requested by the
Administrative Agent to be filed, registered or recorded in order to create in
favor of the Administrative Agent, for the benefit of the Secured Parties, a
perfected Lien on the Collateral described therein, prior and superior in right
to any other Person (other than, with respect to Collateral other than Pledged
Stock, Liens expressly permitted by Section 7.3 and, with respect to Collateral
consisting of Pledged Stock, non-consensual Liens expressly permitted by Section
7.3 to the extent arising by operation of law expressly permitted by Section
7.3), shall have been delivered to the Administrative Agent in proper form for
filing, registration or recordation, as applicable.
(r) Title Insurance; Flood Insurance.
(i) If requested by the Administrative Agent, the Administrative Agent
shall have received, and the title insurance company issuing the policy
referred to in clause (ii) below (the "Title Insurance Company") shall have
received, maps or plats of an as-built survey of the sites of the Mortgaged
Properties certified to the Administrative Agent and the Title Insurance
Company in a manner satisfactory to them, dated a date satisfactory to the
Administrative Agent and the Title Insurance Company by an independent
professional licensed land surveyor satisfactory to the Administrative
Agent and the Title Insurance Company, which maps or plats and the surveys
on which they are based shall be made in accordance with the Minimum
Standard Detail Requirements for Land Title Surveys jointly established and
adopted by the American Land Title Association and the American Congress on
Surveying and Mapping in 1992 or 1998 and meeting the accuracy requirements
of an "Urban" survey as defined therein, and, without limiting the
generality of the foregoing, there shall be surveyed and shown on such
maps, plats or surveys the following: (A) the locations on such sites of
all the buildings, structures and other improvements and the established
building setback lines; (B) the lines of streets abutting the sites and
width thereof; (C) all access and other easements appurtenant to the sites;
(D) all roadways, paths, driveways, easements, encroachments and
overhanging projections and similar encumbrances affecting the site,
whether recorded, apparent from a physical inspection of the sites or
otherwise known to the surveyor; (E) any encroachments on any adjoining
property by the building structures and improvements on the sites; (F) if
the site is described as being on a filed map, a legend relating the survey
to said map; and (G) the flood zone designations, if any, in which the
Mortgaged Properties are located.
(ii) The Administrative Agent shall have received in respect of each
Mortgaged Property a mortgagee's title insurance policy (or policies) or
marked up unconditional binder for such insurance. Each such policy shall
(A) be in an amount satisfactory to the Administrative Agent; (B) be issued
at ordinary rates; (C) insure that the Mortgage insured thereby creates a
valid first Lien on such Mortgaged Property free and clear of all defects
and encumbrances, except as disclosed therein; (D) name the Administrative
Agent for the benefit of the Secured Parties as the insured thereunder; (E)
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if available in the jurisdiction where the Mortgaged Property is located,
be in the form of ALTA Loan Policy - 1970 (Amended 10/17/70 and 10/17/84)
(or equivalent policies); (F) contain such endorsements and affirmative
coverage as the Administrative Agent may reasonably request in form and
substance acceptable to the Administrative Agent, including, without
limitation (to the extent applicable with respect to such Mortgaged
Property and available in the jurisdiction in which such Mortgaged Property
is located), the following: variable rate endorsement; survey endorsement;
comprehensive endorsement; zoning (ALTA 3.1 with parking added)
endorsement; first loss, last dollar and tie-in endorsement; access
coverage; separate tax parcel coverage; contiguity coverage; and such other
endorsements as the Administrative Agent shall reasonably require in order
to provide insurance against specific risks identified by the
Administrative Agent in connection with such Mortgaged Property, and (G) be
issued by title companies satisfactory to the Administrative Agent
(including any such title companies acting as co-insurers or reinsurers, at
the option of the Administrative Agent). The Administrative Agent shall
have received evidence satisfactory to it that all premiums in respect of
each such policy, all charges for mortgage recording tax, and all related
expenses, if any, have been paid.
(iii) If reasonably requested by the Administrative Agent, the
Administrative Agent shall have received with respect to any property
encumbered by a Mortgage which is located in a flood hazard zone (A) a
policy of flood insurance that (1) covers any parcel of improved real
property that is encumbered by any Mortgage (2) is written in an amount not
less than the outstanding principal amount of the indebtedness secured by
such Mortgage that is reasonably allocable to such real property or the
maximum limit of coverage made available with respect to the particular
type of property under the National Flood Insurance Act of 1968, whichever
is less, and (3) has a term ending not later than the maturity of the
Indebtedness secured by such Mortgage and (B) confirmation that the
Borrower has received the notice required pursuant to Section 208(e)(3) of
Regulation H.
(iv) The Administrative Agent shall have received a copy of all
recorded documents referred to, or listed as exceptions to title in, the
title policy or policies referred to in clause (ii) above and a copy of all
other material documents affecting the Mortgaged Properties.
(s) Insurance. The Administrative Agent shall have received insurance
certificates satisfying the requirements of Section 4.24 and of Section 5.3 of
the Guarantee and Collateral Agreement.
(t) Miscellaneous. The Administrative Agent shall have received such other
documents, agreements, certificates and information as it shall reasonably
request.
5.2 Conditions to Each Extension of Credit. The agreement of each Lender to
make any extension of credit requested to be made by it on any date (including,
without limitation, its initial extension of credit) is subject to the
satisfaction of the following conditions precedent:
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(a) Representations and Warranties. Each of the representations and
warranties made by Holdings or any Loan Party in or pursuant to the Loan
Documents shall be true and correct in all material respects on and as of such
date as if made on and as of such date, except (i) in the case of the initial
extension of credit hereunder, in which case such representations and warranties
shall be true and correct on and as of such date as if made on and as of such
date, and (ii) for representations and warranties expressly stated to relate to
a specific earlier date, in which case such representations and warranties shall
have been true and correct as of such earlier date.
(b) No Default. No Default or Event of Default shall exist on such date or
after giving effect to the extensions of credit requested to be made on such
date.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.2 have been satisfied.
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower (and, as to clause (ii) below only, Holdings) hereby agrees
that, so long as the Commitments remain in effect, any Letter of Credit remains
outstanding or any Loan or other Obligation (excluding Obligations in respect of
any Specified Hedge Agreement and unmatured contingent reimbursement and
indemnification Obligations) is owing to any Lender, the Arranger or any Agent
hereunder, (i) the Borrower shall and shall cause each of its Subsidiaries to
and, (ii) as to Section 6.14 only, Holdings shall and shall cause each of its
Subsidiaries to:
6.1 Financial Statements. Furnish to the Administrative Agent and each
Lender:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated
and consolidating balance sheet of Holdings and its consolidated
Subsidiaries as at the end of such year and the related audited
consolidated statements of income and of cash flows for such year, setting
forth in each case in comparative form the figures for the previous year,
reported on without a "going concern" or like qualification or exception,
or qualification arising out of the scope of the audit, by PriceWaterhouse
Xxxxxx LLP or other independent certified public accountants of nationally
recognized standing;
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated and consolidating balance
sheet of Holdings and its consolidated Subsidiaries as at the end of such
quarter and the related unaudited consolidated and consolidating statements
of income and of cash flows for such quarter and the portion of the fiscal
year through the end of such quarter, setting forth in each case in
comparative form the figures for the previous year, certified by a
Responsible Officer of Holdings as being fairly stated in all material
respects (subject to normal year-end audit adjustments and the absence of
footnotes); and
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(c) as soon as available, but in any event not later than 45 days
after the end of each month occurring during each fiscal year of the
Borrower (other than the third, sixth, ninth and twelfth such month), the
unaudited consolidated and consolidating balance sheets of Holdings and its
Subsidiaries as at the end of such month and the related unaudited
consolidated and consolidating statements of income and of cash flows for
such month and the portion of the fiscal year through the end of such
month, setting forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer of Holdings as being
fairly stated in all material respects (subject to normal year-end audit
adjustments and the absence of footnotes);
all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
6.2 Certificates; Other Information. Furnish to the Administrative Agent on
behalf of each Lender, or, in the case of clause (k), to the relevant Lender:
(a) concurrently with the delivery of the financial statements
referred to in Section 6.1(a), a certificate of the independent certified
public accountants reporting on such financial statements stating that in
making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default, except as specified in such certificate;
(b) concurrently with the delivery of any financial statements
pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating
that, to the best of each such Responsible Officer's knowledge, Holdings
and each Loan Party during such period has observed or performed all of its
covenants and other agreements, and satisfied every condition, contained in
this Agreement and the other Loan Documents to which it is a party to be
observed, performed or satisfied by it, and that such Responsible Officer
has obtained no knowledge of any Default or Event of Default except as
specified in such certificate and (ii) in the case of quarterly or annual
financial statements, (x) a Compliance Certificate containing all
information and calculations necessary for determining compliance by the
Borrower and its Subsidiaries with the provisions of this Agreement
referred to therein as of the last day of the fiscal quarter or fiscal year
of the Borrower, as the case may be, and (y) to the extent not previously
disclosed to the Administrative Agent in writing, a listing of any county,
state, territory, province, region or any other jurisdiction, or any
political subdivision thereof, whether of the United States or otherwise,
where any Loan Party keeps inventory or equipment (other than mobile goods)
and of any Intellectual Property acquired by any Loan Party since the date
of the most recent list delivered pursuant to this clause (y) (or, in the
case of the first such list so delivered, since the Closing Date);
(c) as soon as available, and in any event no later than 45 days after
the end of each fiscal year of the Borrower, a detailed consolidated and
consolidating budget for the following fiscal year (including a projected
consolidated and consolidating balance sheet of Holdings and its
Subsidiaries as of the end of the following fiscal year, and the related
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consolidated and consolidating statements of projected cash flow, projected
changes in financial position and projected income), and, as soon as
available, significant revisions, if any, of such budget and projections
with respect to such fiscal year (collectively, the "Projections"), which
Projections shall in each case be accompanied by a certificate of a
Responsible Officer stating that such Projections are based on reasonable
estimates, information and assumptions and that such Responsible Officer
has no reason to believe that such Projections are incorrect or misleading
in any material respect;
(d) within 45 days after the end of each fiscal quarter of the
Borrower, a narrative discussion and analysis of the financial condition
and results of operations of Holdings and its Subsidiaries for such fiscal
quarter and for the period from the beginning of the then current fiscal
year to the end of such fiscal quarter, as compared to the portion of the
Projections covering such periods and to the comparable periods of the
previous year;
(e) as soon as possible and in any event no later than five Business
Days prior to the effectiveness thereof, copies of substantially final
drafts of any proposed amendment, supplement, waiver or other modification
with respect to the Senior Subordinated Note Documentation, the Senior
Holdings Note Documentation, the Acquisition Agreement, any other
Acquisition Documentation or the Governing Documents of Holdings, the
Borrower or any of its Subsidiaries;
(f) within five days after the same are sent, copies of all financial
statements and reports that the Borrower or any of its Subsidiaries sends
to the holders of any class of its debt securities or public equity
securities and, within five days after the same are filed, copies of all
financial statements and reports that the Borrower or any of its
Subsidiaries may make to, or file with, the SEC;
(g) as soon as possible and in any event within five Business Days of
obtaining knowledge thereof: (i) notice of any development, event, or
condition that, individually or in the aggregate with other developments,
events or conditions, could reasonably be expected to result in the payment
by the Borrower or any of its Subsidiaries, in the aggregate, of a Material
Environmental Amount; and (ii) any notice that any Governmental Authority
may condition approval of, or any application for, an Environmental Permit
or any other material Permit held by the Borrower or any of its
Subsidiaries on terms and conditions that are materially burdensome to the
Borrower or any of its Subsidiaries, or to the operation of any of its
businesses (both before and after giving effect to the Acquisition) or any
property owned, leased or otherwise operated by such Person;
(h) on the date of the occurrence thereof, notice that (i) any or all
of the obligations under the Senior Subordinated Note Indenture have been
accelerated, or (ii) the trustee or the required holders of Senior
Subordinated Notes has given notice that any or all such obligations are to
be accelerated;
(i) on the date of the occurrence thereof, notice that (i) any or all
of the obligations under the Senior Holdings Notes have been accelerated,
or (ii) any of the
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holders of Senior Holdings Notes have given notice that any or all such
obligations are to be accelerated;
(j) to the extent not included in clauses (a) through (i) above, no
later than the date the same are required to be delivered thereunder,
copies of all agreements, documents or other instruments or items
(including, without limitation regular, periodic and special securities
reports) that Holdings or any of its Subsidiaries is required to provide
pursuant to the terms of the Senior Subordinated Note Documentation or the
Senior Holdings Note Documentation; and
(k) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.
6.3 Payment of Obligations. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may be.
6.4 Conduct of Business and Maintenance of Existence, etc. (a) (i)
Preserve, renew and keep in full force and effect its corporate existence and
(ii) take all reasonable action to maintain all rights, privileges and
franchises necessary or desirable in the normal conduct of its business, except,
in each case, as otherwise permitted by Section 7.4 and except, in the case of
clause (ii) above, to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect; and (b) comply with all Contractual
Obligations and Requirements of Law except to the extent that failure to comply
therewith could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.
6.5 Maintenance of Property; Insurance.
(a) Keep all Property and systems useful and necessary in its business in
good working order and condition, ordinary wear and tear excepted.
(b) Maintain all rights of way, easements, grants, privileges, licenses,
certificates, and permits necessary or advisable for the use of any Mortgaged
Property and will not, without the prior written consent of the Administrative
Agent, consent to any public or private restriction as to the use of any
Mortgaged Property.
(c) Ensure that the Mortgaged Property known as Halifax County/South Boston
Industrial Park, First Addition does not remain idle for a period of more than
18 consecutive months, and will not permit any occupant of such Mortgaged
Property to engage in any business or manufacturing activity not contemplated
for such Mortgaged Property for a period of more than 18 consecutive months.
(d) Maintain with financially sound and reputable insurance companies
insurance on all its Property (including, without limitation, all inventory,
equipment and vehicles) in at least such amounts and against at least such risks
as are usually insured against in the same general area by companies engaged in
the same or a similar business; and furnish to the
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Administrative Agent with copies for each Secured Party, upon written request,
full information as to the insurance carried; provided that in any event each of
the Borrower and its Subsidiaries will maintain (i) property and casualty
insurance on all Property on an all risks basis (including the perils of flood
and quake, loss by fire, explosion and theft and such other risks and hazards as
are covered by a standard extended coverage insurance policy), covering the
repair or replacement cost of all such Property and consequential loss coverage
for business interruption and extra expense (which shall include construction
expenses and such other business interruption expenses as are otherwise
generally available to similar businesses) provided that, with respect to any
such Property located in a flood hazard zone, any such insurance must comply
with Section 5.1(r)(iii), (ii) public liability insurance, and (iii) building
law and ordinance coverage in such amount as to address to the satisfaction of
the Administrative Agent any increased cost of construction, debris removal
and/or demolition expenses incurred as a result of the application of any
building law and/or ordinance. All such insurance with respect to each of the
Borrower and its Subsidiaries shall be provided by insurers or reinsurers which
(x) in the case of United States insurers and reinsurers, have an A.M. Best
policyholders rating of not less than A- with respect to primary insurance and
B+ with respect to excess insurance and (y) in the case of non-United States
insurers or reinsurers, the providers of at least 80% of such insurance have
either an ISI policyholders rating of not less than A, an A.M. Best
policyholders rating of not less than A- or a surplus of not less than
$500,000,000 with respect to primary insurance, and an ISI policyholders rating
of not less than BBB with respect to excess insurance, or, if the relevant
insurance is not available from such insurers, such other insurers as the
Administrative Agent may approve in writing. All insurance shall (i) provide
that no cancellation, material reduction in amount or material change in
coverage thereof shall be effective until at least 30 days after receipt by the
Administrative Agent of written notice thereof, (ii) if reasonably requested by
the Administrative Agent, include a breach of warranty clause, (iii) contain a
"Replacement Cost Endorsement" with a waiver of depreciation and a waiver of
subrogation against any Secured Party, (iv) contain a standard noncontributory
mortgagee clause naming the Administrative Agent (and/or such other party as may
be designated by the Administrative Agent) as the party to which all payments
made by such insurance company shall be paid, (v) if requested by the
Administrative Agent, contain endorsements providing that none of the Borrower
or any of its Subsidiaries, any Secured Party or any other Person shall be a
co-insurer under such insurance policies, and (vi) be reasonably satisfactory in
all other respects to the Administrative Agent. Each Secured Party shall be
named as an additional insured on all liability insurance policies of each of
the Borrower and its Subsidiaries and the Administrative Agent shall be named as
loss payee on all property and casualty insurance policies of each such Person.
(e) Deliver to the Administrative Agent on behalf of the Secured Parties,
(i) on the Closing Date, a certificate dated such date showing the amount and
types of insurance coverage as of such date, (ii) upon request of any Secured
Party from time to time, full information as to the insurance carried, (iii)
promptly following receipt of notice from any insurer, a copy of any notice of
cancellation or material change in coverage from that existing on the Closing
Date, (iv) forthwith, notice of any cancellation or nonrenewal of coverage by
any of the Borrower or any of its Subsidiaries, and (v) promptly after such
information is available to any of the Borrower or any of its Subsidiaries, full
information as to any claim for an amount in excess of $1,000,000 with respect
to any property and casualty insurance policy maintained by any of the Borrower
or its Subsidiaries.
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(f) Preserve and protect the Lien status of each respective Mortgage and,
if any Lien (other than unrecorded Liens permitted under Section 7.3 that arise
by operation of law and other Liens permitted under Section 7.3(f)) is asserted
against a Mortgaged Property, promptly and at its expense, give the
Administrative Agent a detailed written notice of such Lien and pay the
underlying claim in full or take such other action so as to cause it to be
released or bonded over in a manner satisfactory to Administrative Agent.
6.6 Inspection of Property; Books and Records; Discussions. (a) Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) permit
representatives of any Lender to visit and inspect any of its properties and
examine and, at the Borrower's expense, make abstracts from any of its books and
records at any reasonable time and to discuss the business, operations,
properties and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its Subsidiaries
and with their respective independent certified public accountants; provided
that for so long as no Default or Event of Default exists, such visits shall be
coordinated with the Administrative Agent so that in any fiscal quarter of the
Borrower, no Lender other than the Administrative Agent shall be permitted to
visit more than once.
6.7 Notices. Promptly give notice to the Administrative Agent on behalf of
each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the
Borrower or any of its Subsidiaries and any Governmental Authority, that in
either case, if not cured or if adversely determined, as the case may be,
could reasonably be expected to have a Material Adverse Effect;
(c) any litigation or proceeding known to the Borrower affecting the
Borrower or any of its Subsidiaries in which the amount involved is
$1,000,000 or more and not covered by insurance or in which injunctive or
similar relief is sought;
(d) the following events, as soon as possible and in any event within
30 days after the Borrower or any of its Subsidiaries knows or has reason
to know thereof: (i) the occurrence of any Reportable Event with respect to
any Plan, a failure to make any required contribution to a Single or
Multi-Employer Plan, the creation of any Lien in favor of the PBGC or a
Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the institution of
proceedings or the taking of any other action by the PBGC or the Borrower
or any Commonly Controlled Entity or any Multiemployer Plan with respect to
the withdrawal from, or the termination, Reorganization or Insolvency of,
any Plan;
(e) any development or event that has had or could reasonably be
expected to have a Material Adverse Effect; and
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(f) any notice of default given to the Borrower or any of its
Subsidiaries from a landlord in connection with any leased property where
inventory of the Borrower or its Subsidiaries is located.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower or the relevant Subsidiary proposes to take
with respect thereto.
6.8 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance in all
material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws and Environmental Permits, and obtain, maintain and comply in
all material respects with and maintain, and ensure that all tenants and
subtenants obtain, maintain and comply in all material respects with and
maintain, any and all material licenses, approvals, notifications, registrations
or permits required by applicable Environmental Laws.
(b) Conduct and complete in all material respects all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws.
6.9 Interest Rate Protection. In the case of the Borrower, within 90 days
after the Closing Date, enter into Hedge Agreements to the extent necessary to
provide that at least 50% of the aggregate principal amount of the Term Loans is
subject to either a fixed interest rate or interest rate protection for a period
of not less than three years, which Hedge Agreements shall have terms and
conditions reasonably satisfactory to the Administrative Agent.
6.10 Additional Collateral, etc.
(a) With respect to any Property acquired after the Closing Date or, in the
case of inventory or equipment, any Property moved after the Closing Date, by
the Borrower or any of its Subsidiaries or any Capital Stock of the Borrower
acquired by Holdings after the Closing Date (other than (x) any Property
described in paragraphs (b), (c) or (d) of this Section, (y) any Property
subject to a Lien expressly permitted by Section 7.3(g) and (z) Property
acquired by an Excluded Foreign Subsidiary) as to which the Administrative
Agent, for the benefit of the Secured Parties, does not have a perfected Lien,
promptly (and, in any event, within 30 days following the date of such
acquisition) (or, with respect to any Capital Stock of the Borrower acquired by
Holdings after the Closing Date, shall cause Holdings to) (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents (including landlord waivers) as the
Administrative Agent deems necessary or advisable to grant to the Administrative
Agent, for the benefit of the Secured Parties, a security interest in such
Property and (ii) take all actions necessary or advisable to grant to the
Administrative Agent, for the benefit of the Secured Parties, a perfected first
priority security interest in such Property, including without limitation, the
filing of Uniform Commercial Code financing statements in such jurisdictions as
may be required by the Guarantee and Collateral Agreement or by law or as may be
requested by the Administrative Agent.
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(b) With respect to any fee interest in any real property having a value
(together with improvements thereof) of at least $1,000,000 acquired after the
Closing Date by the Borrower or any of its Subsidiaries (other than any such
real property owned by an Excluded Foreign Subsidiary or subject to a Lien
expressly permitted by Section 7.3(g)) promptly (and, in any event, within 30
days following the date of such acquisition) (i) execute and deliver a first
priority Mortgage in favor of the Administrative Agent, for the benefit of the
Secured Parties, covering such real property, (ii) if requested by the
Administrative Agent, provide the Secured Parties with (x) title and extended
coverage insurance covering such real property in an amount at least equal to
the purchase price of such real property (or such other amount as shall be
reasonably specified by the Administrative Agent) as well as a current ALTA
survey thereof, together with a surveyor's certificate and (y) any consents or
estoppels reasonably deemed necessary or advisable by the Administrative Agent
in connection with such Mortgage, each of the foregoing in form and substance
reasonably satisfactory to the Administrative Agent and (iii) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(c) With respect to any Subsidiary (other than an Excluded Foreign
Subsidiary) created or acquired after the Closing Date (which, for the purposes
of this paragraph, shall include any existing Subsidiary that ceases to be an
Excluded Foreign Subsidiary), by the Borrower or any of its Subsidiaries,
promptly (and, in any event, within 30 days following such creation or the date
of such acquisition) (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems necessary or advisable to grant to the Administrative Agent, for the
benefit of the Secured Parties, a perfected first priority security interest in
the Capital Stock of such Subsidiary that is owned by the Borrower or any of its
Subsidiaries, (ii) deliver to the Administrative Agent the certificates
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of the Borrower or such
Subsidiary, as the case may be, (iii) cause such Subsidiary (A) to become a
party to the Guarantee and Collateral Agreement and the Intellectual Property
Security Agreement and (B) to take such actions necessary or advisable to grant
to the Administrative Agent for the benefit of the Secured Parties a perfected
first priority security interest in the Collateral described in the Guarantee
and Collateral Agreement and the Intellectual Property Security Agreement with
respect to such Subsidiary, including, without limitation, the recording of
instruments in the United States Patent and Trademark Office and the United
States Copyright Office, the execution and delivery by all necessary Persons of
Control Agreements and the filing of Uniform Commercial Code financing
statements in such jurisdictions as may be required by the Guarantee and
Collateral Agreement, the Intellectual Property Security Agreement or by law or
as may be requested by the Administrative Agent, (iv) cause such Subsidiary to
become a party to the Subordinated Intercompany Note and (v) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(d) With respect to any Excluded Foreign Subsidiary created or acquired
after the Closing Date by the Borrower or any of its Domestic Subsidiaries,
promptly (and, in any event, within 30 days following such creation or the date
of such acquisition) (i) execute and
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deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement as the Administrative Agent deems necessary or advisable in
order to grant to the Administrative Agent, for the benefit of the Secured
Parties, a perfected first priority security interest in the Capital Stock of
such Subsidiary that is owned directly by the Borrower or any of its Domestic
Subsidiaries (provided that in no event shall more than 65% of the total
outstanding Capital Stock of any such Subsidiary be required to be so pledged),
(ii) deliver to the Administrative Agent the certificates representing such
Capital Stock, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the Borrower or such Subsidiary, as
the case may be, and take such other action as may be necessary or, in the
opinion of the Administrative Agent, desirable to perfect the Lien of the
Administrative Agent thereon, (iii) cause such Subsidiary to become a party to
the Subordinated Intercompany Note, and (iv) if requested by the Administrative
Agent, deliver to the Administrative Agent legal opinions relating to the
matters described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent.
(e) Notwithstanding anything to the contrary in this Section 6.10,
paragraphs (a), (b), (c) and (d) of this Section 6.10 shall not apply to any
Property, Subsidiary or Excluded Foreign Subsidiary created or acquired after
the Closing Date, as applicable, as to which the Administrative Agent has
determined in its sole discretion that the collateral value thereof is
insufficient to justify the difficulty, time and/or expense of obtaining a
perfected Lien thereon.
6.11 Year 2000. Take all action necessary and commit adequate resources to
assure that their respective computer-based and other systems are able to
effectively process data including dates before, on and after January 1, 2000
without experiencing any year 2000 problem that could reasonably be expected to
cause a Material Adverse Effect. At the request of the Administrative Agent, the
Borrower shall provide or cause to be provided to the Administrative Agent with
assurance and substantiation (including, but not limited to, the results of
internal or external audit reports prepared in the ordinary course of business)
reasonably acceptable to the Administrative Agent as to the year 2000 capability
of the Borrower and its Subsidiaries and their respective abilities to conduct
their respective businesses and operations before, on and after January 1, 2000
without experiencing a year 2000 problem causing a Material Adverse Effect. For
purposes hereof, "year 2000 problem" means the failure of computer-based and
other systems or equipment, whether of the Borrower or any of its Subsidiaries
or otherwise, to recognize and perform properly date-sensitive functions
involving certain dates prior to and any date after December 31, 1999, and any
reprogramming errors resulting therefrom.
6.12 Use of Proceeds. Use the proceeds of the Loans only for the purposes
specified in Section 4.16.
6.13 ERISA Documents. The Borrower will cause to be delivered to the
Administrative Agent, promptly upon the Administrative Agent's request, any or
all of the following: (i) a copy of each Plan (or, where any such Plan is not in
writing, a complete description thereof) and, if requested, related trust
agreements or other funding instruments and all amendments thereto, and all
written interpretations thereof and written descriptions thereof that have been
distributed to employees or former employees of the Borrower or any of its
Subsidiaries; (ii) the most recent determination letter issued by the Internal
Revenue Service with respect to each applicable Plan; (iii) for the three most
recent plan years preceding the
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Administrative Agent's request, Annual Reports on Form 5500 Series required to
be filed with any governmental agency for each applicable Plan; (iv) a listing
of all Multiemployer Plans, with the aggregate amount of the most recent annual
contributions required to be made by the Borrower or any Commonly Controlled
Entity to each such Plan and copies of the collective bargaining agreements
requiring such contributions; (v) any information that has been provided to the
Borrower or any Commonly Controlled Entity regarding withdrawal liability under
any Multiemployer Plan; (vi) the aggregate amount of payments made under any
employee welfare benefit plan (as defined in Section 3(1) of ERISA) to any
retired employees of the Borrower or any of its Subsidiaries (or any dependents
thereof) during the most recently completed fiscal year; and (vii) documents
reflecting any agreements between the PBGC and the Borrower or any Commonly
Controlled Entity with respect to any Plan.
6.14 Further Assurances
(a) From time to time execute and deliver, or cause to be executed and
delivered, such additional instruments, certificates or documents, and take all
such actions, as the Administrative Agent may reasonably request, for the
purposes of implementing or effectuating the provisions of this Agreement and
the other Loan Documents, or of more fully perfecting or renewing the rights of
the Administrative Agent and the Lenders with respect to the Collateral (or with
respect to any additions thereto or replacements or proceeds or products thereof
or with respect to any other property or assets hereafter acquired by Holdings,
the Borrower or any Subsidiary which may be deemed to be part of the Collateral)
pursuant hereto or thereto. Upon the exercise by the Administrative Agent or any
Lender of any power, right, privilege or remedy pursuant to this Agreement or
the other Loan Documents which requires any consent, approval, recording,
qualification or authorization of any Governmental Authority, Holdings and the
Borrower will execute and deliver, or will cause the execution and delivery of,
all applications, certifications, instruments and other documents and papers
that the Administrative Agent or such Lender may be required to obtain from
Holdings, the Borrower or any of its Subsidiaries for such governmental consent,
approval, recording, qualification or authorization.
(b) As soon as reasonably practicable and, in any event within 10 days
following a Default or Event of Default, deliver to the Administrative Agent,
with a copy for each Lender, written environmental assessments, prepared by a
third party reasonably satisfactory to the Administrative Agent, conforming to
the standards of the ASTM "Standard Practice for Environmental Assessments:
Phase I Environmental Site Assessment Process" for each of the Mortgaged
Properties.
SECTION 7. NEGATIVE COVENANTS
The Borrower (and, as to clauses (ii) and (iii) below only, Holdings)
hereby agrees that, so long as the Commitments remain in effect, any Letter of
Credit remains outstanding or any Loan or other Obligation (excluding
Obligations in respect of any Specified Hedge Agreement and unmatured contingent
reimbursement and indemnification Obligations) is owing to any Lender, the
Arranger or any Agent hereunder, (i) the Borrower shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, (ii) as to Sections
7.2, 7.3, 7.9(d), 7.13, and 7.16 only, Holdings shall not and shall not permit
any of its Subsidiaries to, directly or indirectly, and (iii) as to Section 7.19
only, Holdings shall not, directly or indirectly:
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7.1 Financial Condition Covenants.
(a) Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as
at the last day of any period of four consecutive fiscal quarters of the
Borrower (or, if less, the number of full fiscal quarters subsequent to the
Closing Date) ending with any fiscal quarter set forth below to exceed the ratio
set forth below opposite such fiscal quarter:
Consolidated
Fiscal Quarter Leverage Ratio
-------------- --------------
December, 31, 1999 4.90 : 1.00
March 31, 2000 4.90 : 1.00
June 30, 2000 4.75 : 1.00
September 30, 2000 4.75 : 1.00
December 31, 2000 4.75 : 1.00
March 31, 2001 4.75 : 1.00
June 30, 2001 4.60 : 1.00
September 30, 2001 4.60 : 1.00
December 31, 2001 4.60 : 1.00
March 31, 2002 4.50 : 1.00
June 30, 2002 4.35 : 1.00
September 30, 2002 4.35 : 1.00
December 31, 2002 4.25 : 1.00
March 31, 2003 4.25 : 1.00
June 30, 2003 4.00 : 1.00
September 30, 2003 4.00 : 1.00
December 31, 2003 4.00 : 1.00
March 31, 2004 4.00 : 1.00
June 30, 2004 3.75 : 1.00
September 30, 2004 3.75 : 1.00
December 31, 2004 3.75 : 1.00
March 31, 2005 3.75 : 1.00
June 30, 2005 3.75 : 1.00
September 30, 2005 3.75 : 1.00
December 31, 2005 3.75 : 1.00
March 31, 2006 3.75 : 1.00
June 30, 2006 3.75 : 1.00
September 30, 2006 3.75 : 1.00
December 31, 2006 3.75 : 1.00
March 31, 2007 3.75 : 1.00
June 30, 2007 3.75 : 1.00
; provided, that for the purposes of determining the ratio described above for
the fiscal quarters of the Borrower ending December 31, 1999, March 31, 2000 and
June 30, 2000, Consolidated EBITDA for the relevant period shall be deemed to be
equal to Consolidated EBITDA for the trailing 12-month period ending on the last
date of each such fiscal quarter.
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(b) Consolidated Interest Coverage Ratio. Permit the Consolidated Interest
Coverage Ratio for any period of four consecutive fiscal quarters of the
Borrower (or, if less, the number of full fiscal quarters subsequent to the
Closing Date) ending with any fiscal quarter set forth below to be less than the
ratio set forth below opposite such fiscal quarter:
Consolidated Interest
Fiscal Quarter Coverage Ratio
-------------- --------------
December, 31, 1999 1.75 : 1.00
March 31, 2000 1.75 : 1.00
June 30, 2000 1.75 : 1.00
September 30, 2000 1.75 : 1.00
December 31, 2000 1.75 : 1.00
March 31, 2001 1.75 : 1.00
June 30, 2001 1.90 : 1.00
September 30, 2001 1.90 : 1.00
December 31, 2001 2.00 : 1.00
March 31, 2002 2.00 : 1.00
June 30, 2002 2.00 : 1.00
September 30, 2002 2.00 : 1.00
December 31, 2002 2.00 : 1.00
March 31, 2003 2.00 : 1.00
June 30, 2003 2.00 : 1.00
September 30, 2003 2.00 : 1.00
December 31, 2003 2.00 : 1.00
March 31, 2004 2.00 : 1.00
June 30, 2004 2.25 : 1.00
September 30, 2004 2.25 : 1.00
December 31, 2004 2.25 : 1.00
March 31, 2005 2.25 : 1.00
June 30, 2005 2.25 : 1.00
September 30, 2005 2.25 : 1.00
December 31, 2005 2.75 : 1.00
March 31, 2006 2.75 : 1.00
June 30, 2006 2.75 : 1.00
September 30, 2006 2.75 : 1.00
December 31, 2006 2.75 : 1.00
March 31, 2007 2.75 : 1.00
June 30, 2007 2.75 : 1.00
(c) Consolidated Fixed Charge Coverage Ratio. Permit the Consolidated Fixed
Charge Coverage Ratio for any period of four consecutive fiscal quarters of the
Borrower (or, if less, the number of full fiscal quarters subsequent to the
Closing Date) ending with any fiscal quarter set forth below to be less than the
ratio set forth below opposite such fiscal quarter:
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Consolidated Fixed
Fiscal Quarter Charge Coverage Ratio
-------------- ---------------------
December, 31, 1999 1.10 : 1.00
March 31, 2000 1.10 : 1.00
June 30, 2000 1.10 : 1.00
September 30, 2000 1.10 : 1.00
December 31, 2000 1.10 : 1.00
March 31, 2001 1.10 : 1.00
June 30, 2001 1.10 : 1.00
September 30, 2001 1.10 : 1.00
December 31, 2001 1.10 : 1.00
March 31, 2002 1.10 : 1.00
June 30, 2002 1.10 : 1.00
September 30, 2002 1.10 : 1.00
December 31, 2002 1.10 : 1.00
March 31, 2003 1.10 : 1.00
June 30, 2003 1.10 : 1.00
September 30, 2003 1.10 : 1.00
December 31, 2003 1.10 : 1.00
March 31, 2004 1.10 : 1.00
June 30, 2004 1.20 : 1.00
September 30, 2004 1.20 : 1.00
December 31, 2004 1.20 : 1.00
March 31, 2005 1.20 : 1.00
June 30, 2005 1.20 : 1.00
September 30, 2005 1.20 : 1.00
December 31, 2005 1.20 : 1.00
March 31, 2006 1.20 : 1.00
June 30, 2006 1.20 : 1.00
September 30, 2006 1.20 : 1.00
December 31, 2006 1.20 : 1.00
March 31, 2007 1.20 : 1.00
June 30, 2007 1.20 : 1.00
(d) Minimum Consolidated EBITDA. Permit Consolidated EBITDA for the
Borrower and its Subsidiaries for any period of four consecutive fiscal quarters
of the Borrower ending with any fiscal quarter set forth below to be less than
the amount set forth below opposite such fiscal quarter.
Fiscal Quarter Minimum EBITDA
-------------- --------------
June 30, 2000 $50,000,000
June 30, 2001 $53,500,000
June 30, 2002 $57,000,000
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Fiscal Quarter Minimum EBITDA
-------------- --------------
June 30, 2003 $60,000,000
June 30, 2004 $62,000,000
June 30, 2005 $62,000,000
June 30, 2006 $62,000,000
June 30, 2007 $62,000,000
(e) Senior Debt Coverage Ratio. Permit the Senior Debt Coverage Ratio for
the Borrower and its Subsidiaries for any period of four consecutive fiscal
quarters of the Borrower (or, if less, the number of full fiscal quarters
subsequent to the Closing Date) ending with any fiscal quarter set forth below
to be greater than the ratio set forth below opposite such fiscal quarter;
Senior Debt
Fiscal Quarter Coverage Ratio
-------------- --------------
December, 31, 1999 3.00 : 1.00
March 31, 2000 3.00 : 1.00
June 30, 2000 3.00 : 1.00
September 30, 2000 3.00 : 1.00
December 31, 2000 3.00 : 1.00
March 31, 2001 3.00 : 1.00
June 30, 2001 2.85 : 1.00
September 30, 2001 2.85 : 1.00
December 31, 2001 2.85 : 1.00
March 31, 2002 2.75 : 1.00
June 30, 2002 2.50 : 1.00
September 30, 2002 2.50 : 1.00
December 31, 2002 2.50 : 1.00
March 31, 2003 2.50 : 1.00
June 30, 2003 2.35 : 1.00
September 30, 2003 2.35 : 1.00
December 31, 2003 2.35 : 1.00
March 31, 2004 2.35 : 1.00
June 30, 2004 2.00 : 1.00
September 30, 2004 2.00 : 1.00
December 31, 2004 2.00 : 1.00
March 31, 2005 2.00 : 1.00
June 30, 2005 2.00 : 1.00
September 30, 2005 2.00 : 1.00
December 31, 2005 2.00 : 1.00
March 31, 2006 2.00 : 1.00
June 30, 2006 2.00 : 1.00
September 30, 2006 2.00 : 1.00
December 31, 2006 2.00 : 1.00
March 31, 2007 2.00 : 1.00
June 30, 2007 2.00 : 1.00
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; provided, that for the purposes of determining the ratio described above for
the fiscal quarters of the Borrower ending December 31, 1999, March 31, 2000 and
June 30, 2000, Consolidated EBITDA for the relevant period shall be deemed to be
equal to Consolidated EBITDA for the trailing 12-month period ending on the last
date of each such fiscal quarter.
7.2 Limitation on Indebtedness. Create, incur, assume or suffer to exist
any Indebtedness, except:
(a) Indebtedness of Holdings or any Loan Party pursuant to any Loan
Document;
(b) Unsecured Indebtedness of the Borrower to any Subsidiary and of any
Wholly Owned Subsidiary Guarantor to the Borrower or any other Subsidiary;
provided that such Indebtedness is evidenced by, and subject to the terms and
conditions of, the Subordinated Intercompany Note and is otherwise subordinated
in right of payment to the Obligations under the Loan Documents on terms and
conditions satisfactory to the Administrative Agent;
(c) Indebtedness of the Borrower and its Subsidiaries (including, without
limitation, Capital Lease Obligations) secured by Liens permitted by Section
7.3(g) in an aggregate principal amount not to exceed $5,000,000 at any one time
outstanding;
(d) Indebtedness (other than the Indebtedness referred to in Section
7.2(f)) of the Borrower and its Subsidiaries outstanding on the date hereof and
listed on Schedule 7.2(d) and any refinancings, replacements, refundings,
renewals or extensions thereof (without any increase in the principal amount
thereof or any shortening of the maturity of any principal amount thereof);
(e) Unsecured Guarantee Obligations made in the ordinary course of business
by the Borrower or any of its Subsidiaries of obligations of the Borrower or any
Subsidiary Guarantor;
(f) (i) Unsecured Indebtedness of the Borrower created under the Senior
Subordinated Note Indenture in respect of the Senior Subordinated Notes in an
aggregate principal amount not to exceed $100,000,000 and (ii) Guarantee
Obligations of any Subsidiary Guarantor in respect of such Indebtedness;
provided that such Guarantee Obligations are subordinated to the obligations of
such Subsidiary Guarantor under the Guarantee and Collateral Agreement to the
same extent as the obligations of the Borrower in respect of the Senior
Subordinated Notes are subordinated to the Obligations; and
(g) Indebtedness of the Borrower consisting of customary indemnification,
adjustments of purchase price or similar obligations, in each case incurred or
assumed in connection with the acquisition of any business or assets permitted
to be acquired hereunder;
(h) Unsecured Indebtedness of Holdings created under the Senior Holdings
Notes or the Senior Holdings Note Purchase Agreement in an aggregate principal
amount (excluding accreted value thereon) not to exceed $15,000,000 at any one
time outstanding; and
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(i) additional Indebtedness of Holdings or any of its Subsidiaries in an
aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed
$5,000,000 (or, if the Consolidated Leverage Ratio is less than 4.0 to 1.0,
$7,500,000) at any one time outstanding.
7.3 Limitation on Liens. Create, incur, assume or suffer to exist any Lien
upon any of its Property, whether now owned or hereafter acquired, except for:
(a) Liens for taxes not yet due and payable or which are being contested in
good faith by appropriate proceedings, provided that adequate reserves with
respect thereto are maintained on the books of the Borrower or its Subsidiaries,
as the case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's or
other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 30 days or that are being contested in good
faith by appropriate proceedings;
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation;
(d) deposits by or on behalf of the Borrower or any of its Subsidiaries to
secure the performance of bids, trade contracts (other than for borrowed money),
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business that, in the aggregate, are not
substantial in amount and which do not in any case materially detract from the
value of the Property subject thereto or materially interfere with the ordinary
conduct of the business of the Borrower or any of its Subsidiaries;
(f) Liens in existence on the date hereof listed on Schedule 7.3(f),
securing Indebtedness permitted by Section 7.2(d), provided that no such Lien is
spread to cover any additional Property after the Closing Date and that the
amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness of the Borrower or any of its Subsidiaries
incurred pursuant to Section 7.2(c) to finance the acquisition of fixed or
capital assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or capital assets, (ii) such
Liens do not at any time encumber any Property other than the Property financed
by such Indebtedness and (iii) the amount of Indebtedness secured thereby is not
increased;
(h) Liens created pursuant to the Security Documents;
(i) any interest or title of a lessor under any lease entered into by the
Borrower or any of its Subsidiaries in the ordinary course of its business and
covering only the assets so leased;
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(j) leases or subleases permitted by Section 7.5 granted to third Persons
not materially interfering with the ordinary course of business of the Borrower
or any of its Subsidiaries;
(k) all building codes and zoning ordinances and other laws, ordinances,
regulations, rules, orders or determinations of any federal, state, county,
municipal or other Governmental Authority now or hereafter enacted which do not
in any case materially detract from the value of the Property subject thereto or
materially interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries;
(l) Liens consisting of rights of set-off of a customary nature or bankers'
liens on amounts on deposit, to the extent arising by operation of law, incurred
in the ordinary course of business;
(m) Liens in favor of the trustee under Section 7.07 of the Senior
Subordinated Note Indenture as in effect on the date hereof and securing fees
and other amounts payable to the trustee thereunder;
(n) Liens on Schedule 7.3(f) which are disclosed in title insurance
policies insuring the Administrative Agent pursuant to this Agreement; and
(o) Liens (not otherwise permitted hereunder) (other than Liens in favor of
Holdings, the Borrower or any of its Subsidiaries) which secure obligations not
exceeding $3,000,000 in the aggregate at any time outstanding, which are pari
passu with or subordinated to the Liens created in favor of the Administrative
Agent pursuant to this Agreement and the other Loan Documents and with respect
to which no foreclosure or other enforcement actions have been commenced.
7.4. Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or Dispose of all or substantially all
of its Property or business, except that:
(a) any Solvent Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the Borrower shall be
the continuing or surviving corporation) or with or into any Subsidiary
Guarantor (provided that the Subsidiary Guarantor shall be the continuing
or surviving corporation); and
(b) any Subsidiary of the Borrower may Dispose of any or all of its
assets (upon voluntary liquidation or otherwise) to the Borrower or any
Subsidiary Guarantor.
7.5. Limitation on Disposition of Property. Dispose of any of its Property
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary of Holdings,
issue or sell any shares of such Subsidiary's Capital Stock to any Person,
except:
(a) the Disposition of obsolete or worn out property in the ordinary
course of business;
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(b) the Disposition of inventory in the ordinary course of business;
(c) Dispositions permitted by Section 7.4(b);
(d) the sale or issuance of (i) any Subsidiary's Capital Stock (other
than Disqualified Stock) to the Borrower or any Subsidiary Guarantor or
(ii) the Borrower's Capital Stock (other than Disqualified Stock) to
Holdings;
(e) the Disposition by the Borrower or any of its Subsidiaries of
other tangible or intangible assets having a fair market value not to
exceed $5,000,000 in the aggregate for any fiscal year of the Borrower;
(f) Restricted Payments permitted under Section 7.6;
(g) Dispositions of Cash Equivalents, provided that the aggregate
consideration received therefor is at least equal to the aggregate fair
market value of the Cash Equivalents so Disposed of; and
(h) any Recovery Event, provided, that the requirements of Section
2.12(b) are complied with in connection therewith.
7.6. Limitation on Restricted Payments. Declare or pay any dividend (other
than dividends payable solely in common stock (excluding Disqualified Stock) of
the Person making such dividend) on, or make any payment on account of, or set
apart assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any Capital Stock of
the Borrower or any of its Subsidiaries, whether now or hereafter outstanding,
or make any other distribution in respect thereof, either directly or
indirectly, whether in cash or property or in obligations of the Borrower or any
of its Subsidiaries, or enter into any derivatives or other transaction with any
financial institution, commodities or stock exchange or clearinghouse (a
"Derivatives Counterparty") obligating the Borrower or any of its Subsidiaries
to make payments to such Derivatives Counterparty as a result of any change in
market value of any such Capital Stock (collectively, "Restricted Payments"),
except that:
(a) any Wholly Owned Subsidiary may declare and pay cash dividends to
the Borrower or any Subsidiary Guarantor;
(b) the Borrower may declare and pay cash dividends to Holdings to
permit Holdings to (i) pay corporate overhead expenses incurred in the
ordinary course of business not to exceed $500,000 in any fiscal year
($1,000,000 as to the fiscal year ending June 30, 2000) of the Borrower;
(ii) pay any taxes which are due and payable by Holdings and the Borrower
as part of a consolidated group; (iii) repurchase stock of Holdings held by
employees of the Borrower not to exceed $2,000,000 in any fiscal year of
the Borrower; (iv) after November 30, 2004, pay cash interest then due and
payable on the Senior Holdings Notes in an aggregate amount not to exceed
12% per annum on the Senior Holdings Notes issued November 30, 1999, plus
interest at the same rate on any Senior Holdings Notes issued to pay
interest thereon; provided that, in each case, such cash payments are used
within 30 days of such payment to make interest payments on such
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senior notes; and (v) satisfy tax obligations that are actually due and
owing, in accordance with the Tandy Tax Sharing Agreement as in effect on
the date hereof; provided that the amount of such dividends does not exceed
the amount that, without recognizing any tax loss carryforwards or
carrybacks or other tax attributes, such as alternative minimum tax
carryforwards, would otherwise be due and owing if the Borrower and its
Subsidiaries were an independent, individual taxpayer; provided that, as to
clauses (iv) and (v) only, the Borrower may not declare and pay cash
dividends if a Default or Event of Default exists;
(c) on the Closing Date, the Borrower may declare and pay cash
dividends to Holdings in an aggregate amount not to exceed $201,753,000 to
permit Holdings to consummate the Acquisition in accordance with the
Acquisition Documentation (including, without limitation, to the extent
permitted under the Acquisition Documentation, to make payments or
distributions to dissenting shareholders of the Borrower); and
(d) any Solvent Wholly Owned Subsidiary of a Loan Party may declare
and pay dividends on its Capital Stock (other than Disqualified Stock) to
its parent in order to effect a reorganization otherwise permitted
hereunder.
7.7. Limitation on Capital Expenditures. Make or commit to make any
Capital Expenditure, except (a) Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business not exceeding in any fiscal year
of the Borrower the amount set forth below opposite such fiscal year:
Fiscal Year Maximum Capital Expenditures
----------- ----------------------------
2000 $18,500,000
2001 $20,000,000
2002 $26,000,000
2003 $25,000,000
2004 $20,000,000
2005 $20,000,000
2006 $30,000,000
2007 $30,000,000
provided, that (i) up to 50% of any such amount referred to above, if not
so expended in the fiscal year for which it is permitted, may be carried over
for expenditure in the next succeeding fiscal year ("Capital Expenditure Carry
Forward") and (ii) Capital Expenditures made pursuant to this clause (a) during
any fiscal year shall be deemed made, first, in respect of amounts permitted for
such fiscal year as provided above and second, in respect of any Capital
Expenditure Carry Forward, (b) Capital Expenditures made with the proceeds of
any Reinvestment Deferred Amount, (c) Capital Expenditures made with the
proceeds of Excess Cash Flow remaining after giving effect to any mandatory
prepayments required by Section 2.12(c) and (d) Capital Expenditures made with
the proceeds of any capital contribution by Holdings to the Borrower.
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7.8. Limitation on Investments. Make any advance, loan, extension of
credit (by way of guaranty or otherwise) or capital contribution to, or purchase
any Capital Stock, bonds, notes, debentures or other debt securities of, or any
assets constituting an ongoing business from, or make any other investment in,
any other Person (all of the foregoing, "Investments"), except:
(a) extensions of trade credit in the ordinary course of business;
(b) Investments in Cash Equivalents;
(c) Investments arising in connection with the incurrence of
Indebtedness permitted by Section 7.2(b) and (e);
(d) loans and advances to employees of the Borrower or any
Subsidiaries of the Borrower in the ordinary course of business (including,
without limitation, for travel, entertainment and relocation expenses) in
an aggregate amount for the Borrower and its Subsidiaries not to exceed
$1,000,000 at any one time outstanding;
(e) the Acquisition;
(f) Investments in assets useful in the Borrower's or the applicable
Subsidiary's business made by the Borrower or any of its Subsidiaries with
(i) the proceeds of any Reinvestment Deferred Amount, (ii) the proceeds of
any capital contribution by Holdings to the Borrower or (iii) Excess Cash
Flow remaining after giving effect to any mandatory prepayments required by
Section 2.12(c);
(g) Investments (other than those relating to the incurrence of
Indebtedness permitted by Section 7.8(c)) by the Borrower or any of its
Subsidiaries in the Borrower or any Person that, prior to such Investment,
is a Subsidiary Guarantor;
(h) Investments consisting of promissory notes and other deferred
payment obligations of Persons to which the Borrower or any of its
Subsidiaries shall have made Dispositions of assets permitted by Section
7.5, provided that the aggregate principal amount thereof does not exceed
$5,000,000 at any one time outstanding;
(i) security and other deposits permitted by Section 7.3(d); and
(j) in addition to Investments otherwise expressly permitted by this
Section Investments by the Borrower or any of its Subsidiaries in an
aggregate amount (valued at cost) not to exceed $10,000,000 during the term
of this Agreement.
7.9. Limitation on Optional Payments and Modifications of
Indebtedness.
(a) Make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of, or otherwise voluntarily or optionally
defease, the Senior Subordinated Notes on any other Indebtedness of the Borrower
or its Subsidiaries that is subordinated to the Indebtedness created hereunder
(other than the exchange of Senior Subordinated Notes pursuant to the terms of
the Registration Rights Agreement), or segregate
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funds for any such payment, prepayment, repurchase, redemption or defeasance, or
enter into any derivative or other transaction with any Derivatives Counterparty
obligating the Borrower or any of its Subsidiaries to make payments to such
Derivatives Counterparty as a result of any change in market value of the Senior
Subordinated Notes or any such subordinated Indebtedness of the Borrower or its
Subsidiaries, (b) amend, modify or otherwise change, or consent or agree to any
amendment, modification, waiver or other change to, any of the terms (including,
without limitation, the subordination terms) of the Senior Subordinated Note
Documentation or any such subordinated Indebtedness of the Borrower or its
Subsidiaries (other than any such amendment, modification, waiver or other
change which (i) would extend the maturity or reduce the amount of any payment
of principal thereof, reduce the rate or extend the date for payment of interest
thereon and (ii) does not involve the payment of a consent fee), (c) designate
any Indebtedness (other than the Obligations) as "Designated Senior Debt" for
the purposes of the Senior Subordinated Note Indenture or the agreement or
instrument governing or evidencing any other indebtedness of the Borrower or its
Subsidiaries that is subordinated to the Indebtedness created hereunder, or (d)
amend or permit the amendment of its Governing Documents in any manner
determined by the Administrative Agent to be materially adverse to the Lenders.
7.10. Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate unless such transaction
is (a) otherwise permitted under this Agreement, (b) in the ordinary course of
business of the Borrower or such Subsidiary, as the case may be, and (c) upon
fair and reasonable terms no less favorable to the Borrower or such Subsidiary,
as the case may be, than it would obtain in a comparable arm's length
transaction with a Person that is not an Affiliate. Notwithstanding the
foregoing, the Borrower and its Subsidiaries may, subject to Section 7.20, pay
to the Sponsor and its Control Investment Affiliates fees and expenses pursuant
to the Management Services Agreement approved by the board of directors of the
Borrower in an aggregate amount not to exceed the greater of 1.0% of Holdings'
Consolidated EBITDA for the immediately preceding fiscal year and $300,000 in
any fiscal year of the Borrower. The limitations in the first sentence of this
Section 7.10 shall not apply to transactions with Affiliates which are (a)
pursuant to the Equity Documents or (b) loans and advances to employees of the
Borrower or any of its Subsidiaries in the ordinary course of business in
accordance with Section 7.8(d).
7.11. Limitation on Sales and Leasebacks. Enter into any arrangement with
any Person providing for the leasing by the Borrower or any of its Subsidiaries
of Property which has been or is to be sold or transferred by the Borrower or
such Subsidiary to such Person or to any other Person to whom funds have been or
are to be advanced by such Person on the security of such Property or rental
obligations of the Borrower or such Subsidiary, provided that the Borrower or
any of its Subsidiaries may enter into such arrangements so long as (i) the
Property so sold or transferred is sold or transferred for fair value for cash
consideration, and (ii) the gross cash proceeds received by the Borrower or such
Subsidiary from such sales or transfers do not exceed $5,000,000 in the
aggregate for the Borrower and its Subsidiaries.
7.12. Limitation on Changes in Fiscal Periods. Permit the fiscal year of
the Borrower or any of its Subsidiaries to end on a day other than June 30 or
change the Borrower's
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or any of its Subsidiaries' method of determining fiscal quarters, in each case,
without the prior written consent of the Administrative Agent which consent
shall not be unreasonably withheld.
7.13. Limitation on Negative Pledge Clauses. Enter into or suffer to exist
or become effective any agreement that prohibits or limits the ability of
Holdings, the Borrower or any of its Subsidiaries to create, incur, assume or
suffer to exist any Lien upon any of its Property or revenues, whether now owned
or hereafter acquired, to secure the Obligations or, in the case of any
guarantor, its obligations under the Guarantee and Collateral Agreement, other
than (a) this Agreement and the other Loan Documents, (b) any agreements
governing any purchase money Liens or Capital Lease Obligations otherwise
permitted hereby (in which case, any prohibition or limitation shall only be
effective against the assets financed thereby), (c) Section 4.12 of the Senior
Subordinated Note Indenture, as in effect on the date hereof, and (d) the Senior
Holdings Note Purchase Agreement.
7.14. Limitation on Restrictions on Subsidiary Distributions, etc. Enter
into or suffer to exist or become effective any consensual encumbrance or
restriction on the ability of the Borrower or any of its Subsidiaries (or, in
the case of clause (a) only, any Subsidiary of the Borrower) to (a) make
Restricted Payments in respect of any Capital Stock of such Subsidiary held by,
or pay or subordinate any Indebtedness owed to, the Borrower or any other
Subsidiary, (b) make Investments in the Borrower or any other Subsidiary or (c)
transfer any of its assets to the Borrower or any other Subsidiary, except for
such encumbrances or restrictions existing under or by reason of (i) any
restrictions existing under the Loan Documents, (ii) any restrictions under
Section 4.08 of the Senior Subordinated Note Indenture, as in effect on the date
hereof and (iii) any restrictions with respect to a Subsidiary imposed pursuant
to an agreement that has been entered into in connection with the Disposition of
all or substantially all of the Capital Stock or assets of such Subsidiary.
7.15. Limitation on Lines of Business. Enter into any business, either
directly or through any Subsidiary, except for those businesses in which the
Borrower and its Subsidiaries are engaged on the date of this Agreement (after
giving effect to the Acquisition) or that are reasonably related thereto. For
the avoidance of doubt, the entry by the Borrower into the business of the
manufacture and sale of cabinetry shall be deemed to be reasonably related to
the Borrower's existing line of business.
7.16 Limitation on Amendments to Tandy Tax Sharing Agreement, Acquisition
Documentation and Senior Holdings Note Documentation. Amend, supplement, replace
or otherwise modify (whether pursuant to a waiver granted by or to such Person
or otherwise) or fail to enforce strictly the terms and conditions of (i) the
Tandy Tax Sharing Agreement or any of the Acquisition Documentation in a manner
which is reasonably determined by the Administrative Agent to be adverse to any
Agent or any Lender, (ii) any of the Senior Holdings Note Documentation (other
than the warrant agreements related to the Senior Holdings Note Purchase
Agreement), without the prior written consent of the Administrative Agent, or
(iii) any of the warrant agreements related to the Senior Holdings Note Purchase
Agreement without the prior written consent of the Administrative Agent, other
than any such amendment or modification that could not be adverse to any Agent
or any Lender.
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7.17 Limitation on Hedge Agreements. Enter into any Hedge Agreement other
than Specified Hedge Agreements entered into in the ordinary course of business,
and not for speculative purposes.
7.18 Partnerships and Joint Ventures. Become a general or limited partner
in a partnership or a joint venturer in any joint venture, or permit the
Borrower or any of its Subsidiaries to do so, other than any joint venture
permitted by Section 7.8, provided that the Indebtedness of such joint venture
is Non-Recourse Indebtedness.
7.19 Limitation on Activities of Holdings. (a) Conduct, transact or
otherwise engage in, or commit to conduct, transact or otherwise engage in, any
business or operations other than those incidental to (i) Holdings' ownership of
the Capital Stock of its Subsidiaries existing on the date hereof and (ii) the
incurrence and repayment of the Indebtedness on the Senior Holdings Notes and
Indebtedness permitted under Section 7.2(i), (b) own, lease, manage or otherwise
operate any properties or assets (including cash (other than cash received in
connection with dividends made by the Borrower in accordance with Section 7.6
pending application in the manner contemplated by such Section) and Cash
Equivalents) other than the ownership of shares of Capital Stock of its
Subsidiaries existing on the date hereof, (c) create or form any direct
Subsidiaries, or (d) otherwise cease to be a holding company.
7.20 Management Fees. Permit Holdings or any of its Subsidiaries to pay
management fees or expenses pursuant to the Management Services Agreement unless
(i) such fees and expenses are then due and payable under the Management
Services Agreement, (ii) the amount of such management fees does not exceed the
greater of (a) 1.0% of the Borrower's Consolidated Cash Flow (as defined in and
determined in accordance with the Management Services Agreement as in effect on
the date hereof) and (b) $300,000 in any fiscal year of the Borrower, (iii) the
amount of such expenses does not exceed $50,000 in any fiscal year of the
Borrower and (iv) no Default or Event of Default exists.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan or
Reimbursement Obligation when due in accordance with the terms hereof; or
the Borrower shall fail to pay any interest on any Loan or Reimbursement
Obligation, or any other amount payable hereunder or under any other Loan
Document, within five days after any such interest or other amount becomes
due in accordance with the terms hereof; or
(b) Any representation or warranty made or deemed made by any Loan
Party herein or in any other Loan Document or that is contained in any
certificate, document or financial or other statement furnished by it at
any time under or in connection with this Agreement or any such other Loan
Document shall prove to have been false or misleading in any material
respect on or as of the date made or deemed made; or
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(c) (i) Any Loan Party shall default in the observance or performance
of any agreement contained in clause (i) or (ii) of Section 6.4(a) (with
respect to the Borrower only), Section 6.7(a) or Section 7 hereof, (ii)
Holdings or any Loan Party shall default in the observance or performance
of any agreements contained in Section 5 of the Guarantee and Collateral
Agreement, (iii) an "Event of Default" under and as defined in any Mortgage
shall have occurred and be continuing; or (iv) Holdings shall default in
the observance or performance of any agreement contained in any of Sections
7.2, 7.3, 7.9(d), 7.13, 7.16 and 7.19 hereof; or
(d) Holdings or any Loan Party shall default in the observance or
performance of any other covenant or agreement contained in this Agreement
or any other Loan Document (other than as provided in paragraphs (a)
through (c) of this Section), and such default shall continue unremedied
for a period of 30 days; or
(e) The Borrower or any of its Subsidiaries shall (i) default in
making any payment of any principal of any Indebtedness (including, without
limitation, any Guarantee Obligation, but excluding the Loans) on the
scheduled or original due date with respect thereto; or (ii) default in
making any payment of any interest on any such Indebtedness beyond the
period of grace, if any, provided in the instrument or agreement under
which such Indebtedness was created; or (iii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause,
or to permit the holder or beneficiary of such Indebtedness (or a trustee
or agent on behalf of such holder or beneficiary) to cause, with the giving
of notice if required, such Indebtedness to become due prior to its stated
maturity or (in the case of any such Indebtedness constituting a Guarantee
Obligation) to become payable; provided, that a default, event or condition
described in clause (i), (ii) or (iii) of this -------- paragraph (e) shall
not at any time constitute an Event of Default unless, at such time, one or
more defaults, events or conditions of the type described in clauses (i),
(ii) and (iii) of this paragraph (e) shall have occurred and be continuing
with respect to Indebtedness the outstanding principal amount of which
exceeds in the aggregate $5,000,000; or
(f) (i) The Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief
entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or
its debts, or (B) seeking appointment of a receiver, trustee, custodian,
conservator or other similar official for it or for all or any substantial
part of its assets, or the Borrower or any of its Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against the Borrower or any of its Subsidiaries any case,
proceeding or other action of a nature referred to in clause (i) above that
(A) results in the entry of an order for relief or any such adjudication or
appointment or (B) remains undismissed, undischarged or unbonded for a
period of 60 days; or (iii) there shall be commenced against the Borrower
or any of its Subsidiaries any case, proceeding or other
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action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets that
results in the entry of an order for any such relief that shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days
from the entry thereof; or (iv) the Borrower or any of its Subsidiaries
shall take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any non-exempt "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise
on the assets of the Borrower or any Commonly Controlled Entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence
to have a trustee appointed, or a trustee shall be appointed, to administer
or to terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a trustee is, in the
reasonable opinion of the Required Lenders, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Required Lenders is likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of,
a Multiemployer Plan, (vi) the Borrower, any of its Subsidiaries or any
Commonly Controlled Entity shall be required to make during any fiscal year
of the Borrower payments pursuant to any employee welfare benefit plan (as
defined in Section 3(1) of ERISA) that provides benefits to retired
employees (or their dependents) that, in the aggregate, exceed $1,000,000
with respect to such fiscal year, (vii) the Borrower, any of its
Subsidiaries or any Commonly Controlled Entity shall be required to make
during any fiscal year of the Borrower contributions to any defined benefit
pension plan subject to Title IV of ERISA (including any Multiemployer
Plan) that, in the aggregate, exceed $1,000,000 with respect to such fiscal
year or (viii) any other similar event or condition shall occur or exist
with respect to a Plan; and in each case in clauses (i) through (viii)
above, such event or condition, together with all other such events or
conditions, if any, could, in the sole judgment of the Required Lenders,
reasonably be expected to have a Material Adverse Effect; or
(h) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving for the Borrower and its
Subsidiaries taken as a whole a liability (not paid or fully covered by
insurance as to which the relevant insurance company has acknowledged
coverage) of $3,000,000 or more, and all such judgments or decrees shall
not have been vacated, discharged, stayed or bonded pending appeal within
30 days from the entry thereof; or
(i) Any of the Security Documents shall cease, for any reason (other
than pursuant to the terms thereof), to be in full force and effect, or
Holdings, any Loan Party or any Affiliate of Holdings or any Loan Party
shall so assert, or any Lien created by any
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of the Security Documents shall cease to be enforceable and of the same
effect and priority purported to be created thereby; or
(j) Any Loan Party shall default under a lease obligation such that
the landlord under such lease shall be entitled to place a Lien (other than
any Lien permitted under Section 7.3 or, in the case of Collateral
consisting of Pledged Stock, any non-consensual Lien permitted under
Section 7.3 to the extent arising by operation of law) on any of the
Collateral; or
(k) The guarantee contained in Section 2 of the Guarantee and
Collateral Agreement shall cease, for any reason (other than pursuant to
the terms thereof), to be in full force and effect or any Loan Party or any
Affiliate of any Loan Party shall so assert; or
(l) Holdings or any Loan Party or any Affiliate of Holdings or any
Loan Party shall assert that any provision of any Loan Document is not in
full force and effect; or
(m) (i) The Permitted Investors shall cease to have the power to vote
or direct the voting of securities having a majority of the ordinary voting
power for the election of directors of Holdings (determined on a fully
diluted basis); (ii) the Permitted Investors shall cease to own of record
and beneficially an amount of common stock of Holdings equal to at least
70% of the amount of common stock of Holdings owned by the Permitted
Investors of record and beneficially as of the Closing Date; (iii) any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act")),
excluding the Permitted Investors, shall become, or obtain rights (whether
by means or warrants, options or otherwise) to become, the "beneficial
owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act),
directly or indirectly, of more than 30% of the outstanding common stock of
Holdings; (iv) the board of directors of Holdings or the Borrower shall
cease to consist of a majority of Continuing Directors; (v) Holdings shall
cease to own and control, of record and beneficially, directly, 100% of
each class of outstanding Capital Stock of the Borrower free and clear of
all Liens (except non-consensual Liens permitted under Section 7.3 to the
extent arising by operation of law); or (vi) a Specified Change of Control
shall occur; or
(n) The Indebtedness under the Senior Subordinated Note Documentation
or any guarantees thereof shall cease, for any reason, to be validly
subordinated to the Obligations or the obligations of the Subsidiary
Guarantors under the Guarantee and Collateral Agreement, as the case may
be, as provided in the Senior Subordinated Note Documentation, or any Loan
Party, any Affiliate of any Loan Party or the holders (or any trustee on
behalf of the holders) of at least 25% in aggregate principal amount of
such Indebtedness shall so assert;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to any Loan Party,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including, without
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limitation, all amounts of L/C Obligations, whether or not the beneficiaries of
the then outstanding Letters of Credit shall have presented the documents
required thereunder) shall immediately become due and payable, and (B) if such
event is any other Event of Default, either or both of the following actions may
be taken: (i) with the consent of the Majority Revolving Credit Facility
Lenders, the Administrative Agent may, or upon the request of the Majority
Revolving Credit Facility Lenders, the Administrative Agent shall, by notice to
the Borrower declare the Revolving Credit Commitments to be terminated
forthwith, whereupon the Revolving Credit Commitments shall immediately
terminate; and (ii) with the consent of the Required Lenders, the Administrative
Agent may, or upon the request of the Required Lenders, the Administrative Agent
shall, by notice to the Borrower, declare the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the other
Loan Documents (including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) to be due and payable
forthwith, whereupon the same shall immediately become due and payable. Upon the
occurrence and during the continuation of an Event of Default, the
Administrative Agent and the Lenders shall be entitled to exercise any and all
remedies available under the Security Documents, including, without limitation,
the Guarantee and Collateral Agreement and the Mortgages, or otherwise available
under applicable law or otherwise. With respect to all Letters of Credit with
respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to this paragraph, the Borrower shall at such time deposit
in a cash collateral account opened by the Administrative Agent an amount in
immediately available funds equal to the aggregate then undrawn and unexpired
amount of such Letters of Credit (and the Borrower hereby grants to the
Administrative Agent, for the ratable benefit of the Administrative Agent and
the Secured Parties, a continuing security interest in all amounts at any time
on deposit in such cash collateral account to secure the undrawn and unexpired
amount of such Letters of Credit and all other Obligations). If at any time the
Administrative Agent determines that any funds held in such cash collateral
account are subject to any right or claim of any Person other than the
Administrative Agent and the Secured Parties or that the total amount of such
funds is less than the aggregate undrawn and unexpired amount of outstanding
Letters of Credit, the Borrower shall, forthwith upon demand by the
Administrative Agent, pay to the Administrative Agent, as additional funds to be
deposited and held in such cash collateral account, an amount equal to the
excess of (a) such aggregate undrawn and unexpired amount over (b) the total
amount of funds, if any, then held in such cash collateral account that the
Administrative Agent determines to be free and clear of any such right and
claim. Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Loan Parties hereunder and under the other Loan Documents.
After all such Letters of Credit shall have expired or been fully drawn upon,
all Reimbursement Obligations shall have been satisfied and all other
Obligations of the Loan Parties hereunder and under the other Loan Documents
shall have been paid in full, the balance, if any, in such cash collateral
account shall be returned to the Loan Parties (or such other Person as may be
lawfully entitled thereto).
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SECTION 9. THE AGENTS; THE ARRANGER
9.1 Appointment. Each Lender hereby irrevocably designates and appoints the
Agents as the agents of such Lender under this Agreement and the other Loan
Documents, and each such Lender irrevocably authorizes each Agent, in such
capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to such Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, no Agent shall have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent.
9.2 Delegation of Duties. Each Agent may execute any of its duties under
this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
9.3 Exculpatory Provisions. Neither the Arranger, nor any Agent nor any of
their respective officers, directors, partners, employees, agents, attorneys and
other advisors, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement or any other Loan Document (except to the extent
that any of the foregoing are found by a final and nonappealable decision of a
court of competent jurisdiction to have resulted solely from its or such
Person's own gross negligence or willful misconduct) or (ii) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by any Loan Party or any officer thereof contained in this
Agreement or any other Loan Document or in any certificate, report, statement or
other document referred to or provided for in, or received by the Arranger or
the Agents under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party party thereto to perform its obligations hereunder or
thereunder. The Agents shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
9.4 Reliance by Agents. Each Agent shall be entitled to rely, and shall be
fully protected in relying, upon any instrument, writing, resolution, notice,
consent, certificate, affidavit, letter, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to Holdings and the Loan Parties), independent accountants
and other experts selected by such Agent. The Agents may deem and treat the
payee of any Note as the owner thereof for all purposes unless a written notice
of assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent. Each Agent shall be fully justified in failing or
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refusing to take any action under this Agreement or any other Loan Document
unless it shall first receive such advice or concurrence of the Required Lenders
or the requisite Lenders under Section 10.1 to authorize or require such action
or inaction (or, if so specified by this Agreement, all Lenders) as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action. Each Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this Agreement
and the other Loan Documents in accordance with a request of the Required
Lenders or the requisite Lenders under Section 10.1 to authorize or require such
action (or, if so specified by this Agreement, all Lenders), and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Loans and Letters of Credit.
9.5 Notice of Default. No Agent shall be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder unless such Agent
has received notice from a Lender or the Borrower referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give notice thereof to the Lenders. The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the requisite Lenders (or,
if so specified by this Agreement, all Lenders); provided that unless and until
the Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Arranger, the Agents nor any of their respective
officers, directors, employees, agents, attorneys and other advisors, partners,
attorneys-in-fact or affiliates have made any representations or warranties to
it and that no act by the Arranger or any Agent hereinafter taken, including any
review of the affairs of Holdings or a Loan Party or any affiliate of Holdings
or a Loan Party, shall be deemed to constitute any representation or warranty by
the Arranger or any Agent to any Lender. Each Lender represents to the Arranger
and the Agents that it has, independently and without reliance upon the Arranger
or any Agent or any other Lender, and based on such documents and information as
it has deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition, prospects and
creditworthiness of Holdings and the Loan Parties and their affiliates and made
its own decision to make its Loans (and in the case of the Issuing Lender, its
Letters of Credit) hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the Arranger or
any Agent or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition, prospects and creditworthiness of Holdings and the Loan Parties and
their affiliates. Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Administrative Agent hereunder,
neither the Arranger nor any Agent shall have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
operations, property, condition (financial or otherwise), prospects or
creditworthiness
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of Holdings or any Loan Party or any affiliate of Holdings or a Loan Party that
may come into the possession of the Arranger or such Agent or any of its
officers, directors, employees, agents, attorneys and other advisors, partners,
attorneys-in-fact or affiliates.
9.7 Indemnification. The Lenders agree to indemnify the Arranger and each
Agent in its capacity as such (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to
their respective Aggregate Exposure Percentages in effect on the date on which
indemnification is sought under this Section (or, if indemnification is sought
after the date upon which the Commitments shall have terminated and the Loans
shall have been paid in full, ratably in accordance with such Aggregate Exposure
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the Arranger or such Agent in any
way relating to or arising out of, the Commitments, this Agreement, any of the
other Loan Documents, the Acquisition Documentation or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Arranger or
such Agent under or in connection with any of the foregoing; provided that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements that are found by a final and nonappealable decision
of a court of competent jurisdiction to have resulted solely from the Arranger's
or such Agent's gross negligence or willful misconduct. The agreements in this
Section 9.7 shall survive the payment of the Loans and Letters of Credit and all
other amounts payable hereunder.
9.8 Arranger and Agents in Their Individual Capacities. The Arranger and
each Agent and their respective affiliates may make loans to, accept deposits
from and generally engage in any kind of business with any Loan Party as though
the Arranger was not the Arranger and such Agent was not an Agent. With respect
to its Loans made or renewed by it and with respect to any Letter of Credit
issued or participated in by it, the Arranger and each Agent shall have the same
rights and powers under this Agreement and the other Loan Documents as any
Lender and may exercise the same as though it were not the Arranger or an Agent,
as the case may be, and the terms "Lender" and "Lenders" shall include the
Arranger and each Agent in their respective individual capacities.
9.9 Successor Agents. The Administrative Agent may resign as Administrative
Agent upon 10 Business Days' notice to the Lenders and the Borrower. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Required Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent shall
(unless an Event of Default under Section 8(a) or Section 8(f) with respect to
the Borrower shall have occurred and be continuing) be subject to approval by
the Borrower (which approval shall not be unreasonably withheld or delayed),
whereupon such successor agent shall succeed to the rights, powers and duties of
the Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent's rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement
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or any holders of the Loans or Letters of Credit. If no successor agent has
accepted appointment as Administrative Agent by the date that is 10 Business
Days following a retiring Administrative Agent's notice of resignation, the
retiring Administrative Agent's resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. The Syndication Agent may, at
any time, by notice to the Lenders and the Administrative Agent, resign as
Syndication Agent hereunder, whereupon the duties, rights, obligations and
responsibilities of the Syndication Agent hereunder shall automatically be
assumed by, and inure to the benefit of, the Administrative Agent, without any
further act by the Arranger, the Syndication Agent, the Administrative Agent or
any Lender. After any retiring Agent's resignation as Agent, the provisions of
this Section 9 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement and the other Loan
Documents.
9.10 Authorization to Release Liens. The Administrative Agent is hereby
irrevocably authorized by each of the Lenders to release any Lien covering any
Property of Holdings, the Borrower or any of its Subsidiaries that is the
subject of a Disposition which is permitted by this Agreement or which has been
consented to by the requisite Lenders in accordance with Section 10.1.
9.11 The Arranger. The Arranger, in its capacity as such, shall have no
duties or responsibilities, and shall incur no liability, under this Agreement
and the other Loan Documents.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party and/or Holdings, as the case may be, party
to the relevant Loan Document may, or (with the written consent of the Required
Lenders) the Agents and each Loan Party and/or Holdings, as the case may be,
party to the relevant Loan Document may, from time to time, (a) enter into
written amendments, supplements or modifications hereto and to the other Loan
Documents (including amendments and restatements hereof or thereof) for the
purpose of adding any provisions to this Agreement or the other Loan Documents
or changing in any manner the rights of the Lenders or of Holdings and the Loan
Parties hereunder or thereunder or (b) waive, on such terms and conditions as
may be specified in the instrument of waiver, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) forgive the principal amount or extend the
final scheduled date of maturity of any Loan or Reimbursement Obligation, extend
the scheduled date or change the amount of any amortization payment in respect
of any Term Loan, reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment thereof, or increase the
amount or extend the expiration date of any Commitment of any Lender, in each
case without the consent of each Lender directly affected thereby; (ii) amend,
modify or waive any provision of this Section or reduce any percentage specified
in the definition of Required Lenders, Required Prepayment Lenders or Majority
Facility Lenders, consent to the assignment or transfer by
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Holdings or any Loan Party of any of its rights and obligations under this
Agreement and the other Loan Documents, release all or substantially all of the
Collateral or release all or substantially all of the Subsidiary Guarantors from
their guarantee obligations under the Guarantee and Collateral Agreement, in
each case without the consent of all Lenders; (iii) amend, modify or waive any
condition precedent to any extension of credit under the Revolving Credit
Facility set forth in Section 5.2 (including, without limitation, the waiver of
an existing Default or Event of Default required to be waived in order for such
extension of credit to be made) without the consent of the Majority Revolving
Credit Facility Lenders; (iv) reduce the percentage specified in the definition
of Majority Facility Lenders with respect to any Facility without the written
consent of all Lenders under such Facility; (v) amend, modify or waive any
provision of Section 9 without the consent of the Arranger or any Agent directly
affected thereby; (vi) amend, modify or waive any provision of Section 2.6 or
2.7 without the written consent of the Swing Line Lender; (vii) amend, modify or
waive any provision of Section 2.12 or Section 2.18 without the consent of each
Lender directly affected thereby; or (viii) amend, modify or waive any provision
of Section 3 without the consent of the Issuing Lender. Any such waiver and any
such amendment, supplement or modification shall apply equally to each of the
Lenders and shall be binding upon Holdings, the Loan Parties, the Lenders, the
Agents, the Arranger and all future holders of the Loans and Letters of Credit.
In the case of any waiver, Holdings, the Loan Parties, the Lenders, the Arranger
and the Agents shall be restored to their former position and rights hereunder
and under the other Loan Documents, and any Default or Event of Default waived
shall be deemed to be cured and not continuing; but no such waiver shall extend
to any subsequent or other Default or Event of Default, or impair any right
consequent thereon. Any such waiver, amendment, supplement or modification shall
be effected by a written instrument signed by the parties required to sign
pursuant to the foregoing provisions of this Section; provided, that delivery of
an executed signature page of any such instrument by facsimile transmission
shall be effective as delivery of a manually executed counterpart thereof. For
the avoidance of doubt, this Agreement may be amended (or amended and restated)
with the written consent of the Required Lenders, the Arranger, the Agents,
Holdings and the Borrower (x) to add one or more additional credit facilities to
this Agreement and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof
(collectively, the "Additional Extensions of Credit") to share ratably in the
benefits of this Agreement and the other Loan Documents with the Term Loans and
Revolving Extensions of Credit and the accrued interest and fees in respect
thereof and (y) to include appropriately the Lenders holding such credit
facilities in any determination of the Required Lenders, Required Prepayment
Lenders and Majority Facility Lenders; provided, however, that no such amendment
shall permit the Additional Extensions of Credit to share ratably with or with
preference to the Term Loans in the application of mandatory prepayments without
the consent of the Required Prepayment Lenders or otherwise to share ratably
with or with preference to the Revolving Extensions of Credit without the
consent of the Majority Revolving Facility Lenders.
10.2 Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by telecopy when
accompanied by confirmation thereof), and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made when delivered or the
next Business Day after being delivered to an overnight courier, FedEx, or
similar service or, in the case of telecopy notice, when received, addressed (a)
in the case of Holdings, the Borrower, the Arranger and the Agents, as follows
and
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(b) in the case of the Lenders, as set forth on Schedule 1 to the Lender
Addendum to which such Lender is a party or, in the case of a Lender which
becomes a party to this Agreement pursuant to an Assignment and Acceptance, in
such Assignment and Acceptance or (c) in the case of any party, to such other
address as such party may hereafter notify to the other parties hereto:
The Borrower: X'Xxxxxxxx Industries, Inc.
0000 Xxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000-0000
Attention: Vice President - Finance and
Treasurer
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy to: Bruckmann, Rosser, & Xxxxxxxx & Co.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Xxxxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Holdings: X'Xxxxxxxx Industries, Inc.
0000 Xxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000-0000
Attention: Vice President - Finance
and Treasurer
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy to: Bruckmann, Rosser, & Xxxxxxxx & Co.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
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Xxxxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
The Syndication Agent: Wachovia Bank, N.A.
000 Xxxxxxxxx Xx. X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy to: King & Spalding
000 Xxxxxxxxx Xx. X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
The Administrative Agent: Xxxxxx Commercial Paper Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X'Xxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy to: Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
The Arranger: Xxxxxx Brothers Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X'Xxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
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with a copy to: Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Issuing Lender: As notified by the Issuing Lender to
the Administrative Agent and the
Borrower
provided that any notice, request or demand to or upon any Agent or any Lender
shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of the Arranger, any Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations and
warranties made hereunder, in the other Loan Documents and in any document, or
certificate delivered pursuant to any Loan Document shall survive the execution
and delivery of this Agreement and the making of the Loans and other extensions
of credit hereunder.
10.5 Payment of Expenses. The Borrower agrees (a) to pay or reimburse the
Arranger and the Agents for all their reasonable out-of-pocket costs and
expenses incurred in connection with the syndication of the Facilities (other
than fees payable to syndicate members) and the preparation, negotiation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees and disbursements and other charges of counsel to each of the
Arranger, the Administrative Agent and the Syndication Agent, (b) to pay or
reimburse each Lender, the Arranger and each Agent for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the fees and disbursements of counsel
to each Lender and of counsel to the Arranger and each Agent, (c) to pay,
indemnify, and hold each Lender, the Arranger and the Agents harmless from, any
and all recording and filing fees and any and all liabilities with respect to,
or resulting from any delay in paying, stamp, excise and other similar taxes, if
any, which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the other Loan
Documents and any such other documents, and (d) to pay, indemnify, and hold each
Lender, the Arranger, each Agent, their respective affiliates, and their
respective officers, directors, partners, trustees, employees, attorneys and
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other advisors, agents, attorneys-in-fact and controlling persons (each, an
"Indemnitee") harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, any of the foregoing relating to the use of proceeds of the
Loans or Letters of Credit or the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of any Loan Party or
any of the Properties and the fees and disbursements and other charges of legal
counsel in connection with claims, actions or proceedings by any Indemnitee
against the Borrower hereunder (all the foregoing in this clause (d),
collectively, the "Indemnified Liabilities"), provided, that the Borrower shall
have no obligation hereunder to any Indemnitee with respect to Indemnified
Liabilities to the extent such Indemnified Liabilities are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
solely from the gross negligence or willful misconduct of such Indemnitee.
Without limiting the foregoing, and to the extent permitted by applicable law,
the Borrower agrees not to assert and to cause its Subsidiaries not to assert,
and hereby waives and agrees to cause its Subsidiaries so to waive, all rights
for contribution or any other rights of recovery with respect to all claims,
demands, penalties, fines, liabilities, settlements, damages, costs and expenses
of whatever kind or nature, under or related to Environmental Laws, that any of
them might have by statute or otherwise against any Indemnitee. All amounts due
under this Section shall be payable not later than 5 days after written demand
therefor. Statements payable by the Borrower pursuant to this Section shall be
submitted to the Borrower in accordance with Section 10.2, or to such other
Person or address as may be hereafter designated by the Borrower in a written
notice to the Administrative Agent. The agreements in this Section shall survive
repayment of the Loans and Letters of Credit and all other amounts payable
hereunder.
10.6 Successors and Assigns; Participations and Assignments.
(a) This Agreement shall be binding upon and inure to the benefit of
Holdings, the Borrower, the Lenders, the Arranger, the Agents, all future
holders of the Loans and the Letters of Credit and their respective successors
and assigns, except that neither Holdings nor the Borrower may assign or
transfer any of its rights or obligations under this Agreement without the prior
written consent of the Arranger, the Agents and each Lender.
(b) Any Lender may, without the consent of the Borrower or any other
Person, in accordance with applicable law, at any time sell to one or more
banks, financial institutions or other entities (each, a "Participant")
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower, the Arranger and the Agents shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. In no event shall
any Participant under any such participation have any right to approve any
amendment or waiver of any provision of any Loan Document, or any consent to
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any departure by any Loan Party therefrom, except to the extent that such
amendment, waiver or consent would reduce the principal of, or interest on, the
Loans or any fees payable hereunder, or postpone the date of the final maturity
of the Loans, in each case to the extent subject to such participation. The
Borrower agrees that if amounts outstanding under this Agreement and the Loans
are due or unpaid, or shall have been declared or shall have become due and
payable upon the occurrence of an Event of Default, each Participant shall, to
the maximum extent permitted by applicable law, be deemed to have the right of
setoff in respect of its participating interest in amounts owing under this
Agreement to the same extent as if the amount of its participating interest were
owing directly to it as a Lender under this Agreement, provided that, in
purchasing such participating interest, such Participant shall be deemed to have
agreed to share with the Lenders the proceeds thereof as provided in Section
10.7(a) as fully as if it were a Lender hereunder. The Borrower also agrees that
each Participant shall be entitled to the benefits of Sections 2.19, 2.20 and
2.21 with respect to its participation in the Commitments and the Loans
outstanding from time to time as if it was a Lender; provided that, in the case
of Section 2.20, such Participant shall have complied with the requirements of
said Section and provided, further, that no Participant shall be entitled to
receive any greater amount pursuant to any such Section than the transferor
Lender would have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such Participant had no
such transfer occurred.
(c) Any Lender (an "Assignor") may, in accordance with applicable law and
upon written notice to the Syndication Agent, at any time and from time to time
assign to any other Lender or any affiliate or Control Investment Affiliate of
any Lender or, with the consent of the Borrower and the Agents and, in the case
of any assignment of Revolving Credit Commitments, the written consent of the
Issuing Lender and the Swing Line Lender (which, in each case, shall not be
unreasonably withheld or delayed) (provided (x) that no such consent need be
obtained by a Xxxxxx Entity for a period of 180 days following the Closing Date
and (y) the consent of the Borrower need not be obtained with respect to any
assignment of Term Loans), to an additional bank, financial institution or other
entity (an "Assignee") all or any part of its rights and obligations under this
Agreement pursuant to an Assignment and Acceptance, substantially in the form of
Exhibit E, executed by such Assignee and such Assignor (and, where the consent
of the Borrower or, the Agents or the Issuing Lender or the Swing Line Lender is
required pursuant to the foregoing provisions, by the Borrower and such other
Persons) and delivered to the Administrative Agent for its acceptance and
recording in the Register; provided that no such assignment to an Assignee
(other than any Lender or any affiliate thereof) shall be in an aggregate
principal amount of less than $5,000,000 or, after giving effect thereto, result
in such assigning Lender having a Commitment and/or outstanding Loans in an
aggregate amount of less than $2,500,000 (other than in the case of an
assignment of all of a Lender's interests under this Agreement), unless
otherwise agreed by the Borrower, the Syndication Agent and the Administrative
Agent. Any such assignment need not be ratable as among the Facilities. Upon
such execution, delivery, acceptance and recording, from and after the effective
date determined pursuant to such Assignment and Acceptance, (x) the Assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
with a Commitment and/or Loans as set forth therein, and (y) the Assignor
thereunder shall, to the extent provided in such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of an Assignor's rights and obligations
under this Agreement, such Assignor shall cease to be
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a party hereto). Notwithstanding any provision of this Section, the consent of
the Borrower shall not be required for any assignment that occurs at any time
when any Event of Default shall have occurred and be continuing.
(d) The Administrative Agent shall, on behalf of the Borrower, maintain at
its address referred to in Section 10.2 a copy of each Assignment and Acceptance
delivered to it and a register (the "Register") for the recordation of the names
and addresses of the Lenders and the Commitment of, and principal amount of the
Loans owing to, each Lender from time to time. The entries in the Register shall
be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person whose name is
recorded in the Register as the owner of the Loans and any Notes evidencing such
Loans recorded therein for all purposes of this Agreement. Any assignment of any
Loan, whether or not evidenced by a Note, shall be effective only upon
appropriate entries with respect thereto being made in the Register (and each
Note shall expressly so provide). Any assignment or transfer of all or part of a
Loan evidenced by a Note shall be registered on the Register only upon surrender
for registration of assignment or transfer of the Note evidencing such Loan,
accompanied by a duly executed Assignment and Acceptance; thereupon one or more
new Notes in the same aggregate principal amount shall be issued to the
designated Assignee, and the old Notes shall be returned by the Administrative
Agent to the Borrower marked "canceled". The Register shall be available for
inspection by the Borrower or any Lender (with respect to any entry relating to
such Lender's Loans) at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
Assignor and an Assignee (and, in any case where the consent of any other Person
is required by Section 10.6(c), by each such other Person) together with payment
to the Administrative Agent of a registration and processing fee of $3,500
(except that no such registration and processing fee shall be payable (y) in
connection with an assignment by or to a Xxxxxx Entity or (z) in the case of an
Assignee which is already a Lender or is an affiliate of a Lender or a Person
under common management with a Lender), the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the effective date
determined pursuant thereto record the information contained therein in the
Register and give notice of such acceptance and recordation to the Borrower. On
or prior to such effective date, the Borrower, at its own expense, upon request,
shall execute and deliver to the Administrative Agent (in exchange for the
Revolving Credit Note and/or applicable Term Notes, as the case may be, of the
assigning Lender) a new Revolving Credit Note and/or applicable Term Notes, as
the case may be, to such Assignee or its registered assigns in an amount equal
to the Revolving Credit Commitment and/or applicable Term Loans, as the case may
be, assumed or acquired by it pursuant to such Assignment and Acceptance and, if
the Assignor has retained a Revolving Credit Commitment and/or Term Loans, as
the case may be, upon request, a new Revolving Credit Note and/or Term Notes, as
the case may be, to the Assignor or its registered assigns in an amount equal to
the Revolving Credit Commitment and/or applicable Term Loans, as the case may
be, retained by it hereunder. Such new Note or Notes shall be dated the Closing
Date and shall otherwise be in the form of the Note or Notes replaced thereby.
(f) For the avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this Section concerning assignments of Loans and Notes
relate only to
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absolute assignments and that such provisions do not prohibit assignments
creating security interests, including, without limitation, any pledge or
assignment by a Lender of any Loan or Note to any Federal Reserve Bank in
accordance with applicable law.
10.7 Adjustments; Set-off.
(a) Except to the extent that this Agreement provides for payments to be
allocated to a particular Lender or to the Lenders under a particular Facility,
if any Lender (a "Benefited Lender") shall at any time receive any payment of
all or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 8(f), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of such other Lender's Obligations, such Benefited
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Obligations, or shall provide such
other Lenders with the benefits of any such collateral, as shall be necessary to
cause such Benefited Lender to share the excess payment or benefits of such
collateral ratably with each of the Lenders; provided, however, that if all or
any portion of such excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to the Borrower during
the existence of an Event of Default, any such notice being expressly waived by
the Borrower to the extent permitted by applicable law, upon any amount becoming
due and payable by the Borrower hereunder (whether at the stated maturity, by
acceleration or otherwise), to set off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender or any branch or
agency thereof to or for the credit or the account of the Borrower. Each Lender
agrees to notify promptly the Borrower and the Administrative Agent after any
such setoff and application made by such Lender, provided that the failure to
give such notice shall not affect the validity of such setoff and application.
10.8 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. A set of the copies of this Agreement signed by all the
parties shall be lodged with the Borrower and the Administrative Agent.
10.9 Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
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10.10 Integration. This Agreement and the other Loan Documents represent
the agreement of Holdings, the Borrower, the Agents, the Arranger and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Arranger, any Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. Each of Holdings and the
Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its Property in any legal action or proceeding
relating to this Agreement and the other Loan Documents to which it is a party,
or for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to Holdings or the
Borrower, as the case may be, at its address set forth in Section 10.2 or at
such other address of which the Administrative Agent shall have been notified
pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to xxx in
any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
10.13 Acknowledgments. Each of Holdings and the Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Arranger, any Agent nor any Lender has any fiduciary
relationship with or duty to Holdings or the Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between the Arranger, the
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Agents and Lenders, on one hand, and Holdings and the Borrower, on the other
hand, in connection herewith or therewith is solely that of debtor and creditor;
and
(c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Arranger, the Agents and the Lenders or among Holdings, the Borrower and the
Lenders.
10.14 Confidentiality. Each of the Arranger, the Agents and the Lenders
agrees to keep confidential all non-public information provided to it by any
Loan Party pursuant to this Agreement that is designated by such Loan Party as
confidential; provided that nothing herein shall prevent the Arranger, any Agent
or any Lender from disclosing any such information (a) to the Arranger, any
Agent, any other Lender or any affiliate of any thereof (b) to any Participant
or Assignee (each, a "Transferee") or prospective Transferee that agrees to
comply with the provisions of this Section, (c) to any of its employees,
directors, agents, attorneys, accountants and other professional advisors,
(d) to any financial institution that is a direct or indirect contractual
counterparty in swap agreements or such contractual counterparty's professional
advisor (so long as such contractual counterparty or professional advisor to
such contractual counterparty agrees to be bound by the provisions of this
Section), (e) upon the request or demand of any Governmental Authority having
jurisdiction over it, (f) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (g) if requested or required to do so in connection with any
litigation or similar proceeding, (h) that has been publicly disclosed other
than in breach of this Section, (i) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that requires access to information about a Lender's investment portfolio
in connection with ratings issued with respect to such Lender or (j) in
connection with the exercise of any remedy hereunder or under any other Loan
Document; provided, further, that in the case of clauses (e) and (f) only, to
the extent permitted under applicable Requirements of Law, the Arranger or the
applicable Agent or Lender, as the case may be, shall notify such Loan Party of
any such request, demand or order applicable to it so that such Loan Party may
seek a protective order or other appropriate remedy to prevent the disclosure
thereof.
10.15 Release of Collateral and Guarantee Obligations.
(a) Notwithstanding anything to the contrary contained herein or in any
other Loan Document, upon request of the Borrower in connection with any
Disposition of Property permitted by the Loan Documents, the Administrative
Agent shall (without notice to or vote or consent of any Lender, or any
affiliate of any Lender that is a party to any Specified Hedge Agreement) take
such actions as shall be required to release its security interest in any
Collateral being Disposed of in such Disposition, and to release any guarantee
obligations of any Person being Disposed of in such Disposition, to the extent
necessary to permit consummation of such Disposition in accordance with the Loan
Documents provided that the Borrower shall have delivered to the Administrative
Agent, at least five Business Days prior to the date of the proposed release, a
written request for release identifying the relevant Collateral being Disposed
of in such Disposition and the terms of such Disposition in reasonable detail,
including the date thereof, the price thereof and any expenses in connection
therewith, together with a certification by the Borrower stating that such
transaction is in compliance with this Agreement and the other
108
115
Loan Documents and that the proceeds of such Disposition will be applied in
accordance with this Agreement and the other Loan Documents.
(b) Notwithstanding anything to the contrary contained herein or any other
Loan Document, when all Loans and Reimbursement Obligations in respect of
Letters of Credit have been paid in full, and all other Obligations (excluding
Obligations in respect of any Specified Hedge Agreement and unmatured contingent
reimbursement and indemnification Obligations) have been paid in full, all
Commitments have terminated or expired and no Letter of Credit shall be
outstanding, upon request of the Borrower, the Administrative Agent shall
(without notice to or vote or consent of any Lender, or any affiliate of any
Lender that is a party to any Specified Hedge Agreement) take such actions as
shall be required to release its security interest in all Collateral, and to
release all guarantee obligations provided for in any Loan Document, whether or
not on the date of such release there may be outstanding Obligations in respect
of Specified Hedge Agreements.
10.16 Accounting Changes. In the event that any "Accounting Change" (as
defined below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in this Agreement, then
Holdings and the Borrower and the Administrative Agent agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating Holdings' and the Borrower's financial condition shall
be the same after such Accounting Changes as if such Accounting Changes had not
been made. Until such time as such an amendment shall have been executed and
delivered by Holdings, the Borrower, the Administrative Agent and the Required
Lenders, all financial covenants, standards and terms in this Agreement shall
continue to be calculated or construed as if such Accounting Changes had not
occurred. "Accounting Changes" refers to changes in accounting principles
required or permitted by the promulgation of any rule, regulation, pronouncement
or opinion by the Financial Accounting Standards Board of the American Institute
of Certified Public Accountants or, if applicable, the SEC.
10.17 Delivery of Lender Addenda. Each initial Lender shall become a party
to this Agreement by delivering to the Administrative Agent and the Syndication
Agent a Lender Addendum duly executed by such Lender, the Borrower and each
Agent.
10.18 Construction. Each covenant contained herein shall be construed
(absent express provision to the contrary) as being independent of each other
covenant contained herein, so that compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse compliance with
any other covenant. Where any provision herein refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision shall
be applicable whether such action is taken directly or indirectly by such
Person.
10.19 WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWER, THE ARRANGER, THE
AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
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116
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
X'XXXXXXXX INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President & Chief Operating
Officer
Acknowledged and agreed as to its
agreements and obligations in Sections
2.12, 4.8, 4.21, 6.14, 7.2, 7.3, 7.9(d),
7.13, 7.16, 7.19, 7.20, 10.6(a), 10.10
through 10.13, 10.16 and 10.19 only,
X'XXXXXXXX INDUSTRIES HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President & Chief Operating
Officer
XXXXXX BROTHERS INC.,
as Arranger
By: /s/ Xxxxxxx X'Xxxxx
-------------------------------------
Name:
Title:
110
117
WACHOVIA BANK, N.A., as
Syndication Agent
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
XXXXXX COMMERCIAL PAPER INC., as
Administrative Agent
By: /s/ Xxxxxxx X'Xxxxx
-------------------------------------
Name:
Title:
111
118
Annex A
PRICING GRID FOR REVOLVING CREDIT LOANS, SWING LINE LOANS,
TRANCHE A TERM LOANS AND COMMITMENT FEES
--------------------------------------------------------------------------------------------------------
Consolidated Applicable Margin For Commitment Applicable Margin For
Leverage Ratio Eurodollar Loans Fee Base Rate Loans
--------------------------------------------------------------------------------------------------------
=> 4.0 : 1.0 3.25% 0.50% 2.25%
=> 3.0 : 1.0 and < 3.00% 0.50% 2.00%
4.0 : 1.0
< 3.0 : 1.0 2.50% 0.375% 1.50%
Changes in the Applicable Margin with respect to Tranche A Loans, Revolving
Credit Loans and Swing Line Loans or in the Commitment Fee Rate resulting from
changes in the Consolidated Leverage Ratio shall become effective on the first
day after the date (the "Adjustment Date") on which financial statements are
delivered to the Lenders pursuant to Section 6.1 (but in any event not later
than the 45th day after the end of each of the first three quarterly periods of
each fiscal year or the 90th day after the end of each fiscal year, as the case
may be) and shall remain in effect until the next change to be effected pursuant
to this paragraph. If any financial statements referred to above are not
delivered within the time periods specified above, then, until and including the
date on which such financial statements are delivered, the Consolidated Leverage
Ratio as at the end of the fiscal period that would have been covered thereby
shall for the purposes of this definition be deemed to be greater than 4.0 to
1.0. In addition, at all times while an Event of Default shall have occurred and
be continuing, the Consolidated Leverage Ratio shall for the purposes of this
definition be deemed to be greater than 4.0 to 1.0. Each determination of the
Consolidated Leverage Ratio pursuant to this definition shall be made with
respect to the period of four consecutive fiscal quarters of the Borrower ending
as of the last day of the period covered by the relevant financial statements.
A-1
119
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as of
the day and year first above written.
X'XXXXXXXX INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President & Chief Operating
Officer
Acknowledged and agreed as to its
agreements and obligations in Sections
2.12, 4.8, 4.21, 6.14, 7.2, 7.3, 7.9(d),
7.13, 7.16, 7.19, 7.20, 10.6(a), 10.10
through 10.13, 10.16 and 10.19 only,
X'XXXXXXXX INDUSTRIES HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President & Chief Operating
Officer
XXXXXX BROTHERS INC.,
as Arranger
By: /s/ Xxxxxxx X'Xxxxx
-------------------------------------
Name:
Title:
120
WACHOVIA BANK, N.A., as
Syndication Agent
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
XXXXXX COMMERCIAL PAPER INC., as
Administrative Agent
By: /s/ Xxxxxxx X'Xxxxx
-------------------------------------
Name:
Title:
121
WACHOVIA BANK, N.A., as
Syndication Agent
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
XXXXXX COMMERCIAL PAPER INC., as
Administrative Agent
By: /s/ Xxxxxxx X'Xxxxx
-------------------------------------
Name:
Title:
