1
Exhibit 4.2
EXECUTION COPY
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
by and among
OM GROUP, INC.
and
NATIONAL CITY BANK
ABN AMRO BANK N.V.
KEYBANK NATIONAL ASSOCIATION
MELLON BANK, N.A.
and
NATIONAL CITY BANK, as Agent
January 21, 1997
$240,000,000 Total Commitment
Initial Revolving Commitment: $120,000,000
Letters of Credit Sublimit: $10,000,000
Term Commitment: $120,000,000
with provision for increasing the Revolving Commitment to an aggregate of
$240,000,000 upon certain conditions to refinance the outstanding
Term Loans
Expiration Date: January 31, 2002
with provision for annual extension
2
Table of Contents
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1A. CROSS-REFERENCE ................................................ 1
1B. SUMMARY ........................................................ 1
2A. TERM LOAN ...................................................... 1
2A.01 TERM NOTE .............................................. 2
▇▇.▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇ ............................... 2
........................................................................ 2
2A.03 INTEREST: PR LOANS ..................................... 2
2A.04 INTEREST: LIBOR LOANS .................................. 2
2A.05 CLOSING FEE ............................................ 3
2A.06 DELAYED REPAYMENT FEE .................................. 3
2B. REVOLVING COMMITMENTS -- The basic terms of the Revolving Commitments
and the compensation therefor are as follows:
2B.01 AMOUNT ................................................. 3
2B.02 EXPIRATION ............................................. 4
2B.03 OPTIONAL REDUCTIONS .................................... 4
2B.04 COMMITMENT FEE ......................................... 5
2B.05 EXTENSION OF REVOLVING COMMITMENT ...................... 6
2B.06 MANDATORY REDUCTIONS ................................... 6
2C. REVOLVING LOANS ................................................ 6
2C.02 CREDIT REQUESTS ........................................ 7
2C.03 CONDITION: NO DEFAULT .................................. 7
2C.04 INTEREST: PR LOANS ..................................... 8
2C.05 INTEREST: LIBOR LOANS .................................. 8
2D. GENERAL LOAN PROVISIONS ........................................ 9
2D.01 CONDITION: PURPOSE ..................................... 10
2D.02 LOAN MIX ............................................... 10
2D.03 AMOUNTS ................................................ 10
2D.04 LIBOR CONTRACT PERIODS ................................. 10
2D.05 MATURITIES ............................................. 11
2D.06 ROLLOVER OR REFINANCING OF REVOLVING LOANS ............. 12
2D.07 CONTINUATION/CONVERSION OF TERM LOANS .................. 12
2D.08 PREPAYMENTS ............................................ 13
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2D.09 DISBURSEMENT .......................................... 14
2D.10 LIBOR LOANS: UNAVAILABILITY ........................... 14
2D.11 LIBOR LOANS: ILLEGALITY ............................... 15
2E.01 RATABLE PARTICIPATION ................................. 15
2E.02 MAXIMUM ............................................... 15
2E.03 TERM .................................................. 15
2E.04 FORM AND SUBSTANCE .................................... 15
2E.05 CREDIT REQUESTS AND REIMBURSEMENT AGREEMENTS .......... 16
2E.06 COMMISSION ............................................ 16
2E.07 PAYMENT OF DRAFTS ..................................... 16
2E.08 CHANGE OF LAW ......................................... 16
3A.01 FINANCIAL STATEMENTS .................................. 17
3A.02 NOTICE ................................................ 19
3B. GENERAL FINANCIAL STANDARDS ................................... 20
3B.01 FUNDED INDEBTEDNESS/CAPITAL ........................... 20
3B.02 CURRENT RATIO ......................................... 21
3B.03 FUNDED INDEBTEDNESS/EBITDA ............................ 21
3C. AFFIRMATIVE COVENANTS ......................................... 21
3C.01 TAXES ................................................. 21
3C.02 FINANCIAL RECORDS ..................................... 21
3C.03 VISITATION ............................................ 21
3C.04 INSURANCE ............................................. 22
3C.05 CORPORATE EXISTENCE ................................... 22
3C.06 COMPLIANCE WITH LAW ................................... 22
3C.07 PROPERTIES ............................................ 23
3C.08 QUALIFICATION TO DO BUSINESS .......................... 23
3C.09 APPLICATION OF NET OFFERING PROCEEDS .................. 23
3D. NEGATIVE COVENANTS ............................................ 23
3D.01 EQUITY AND ASSET TRANSACTIONS ......................... 23
3D.02 CREDIT EXTENSIONS ..................................... 25
3D.03 BORROWINGS ............................................ 26
3D.04 LIENS, LEASES ......................................... 26
3D.05 DIVIDENDS ............................................. 28
3D.06 CHANGE IN NATURE OF BUSINESS .......................... 28
3D.07 ACCOUNTING CHANGES .................................... 28
3D.08 AMENDMENT; DEFAULT OF MATERIAL CONTRACTS .............. 28
3D.09 USE OF PROCEEDS ....................................... 28
3D.10 ADVERSE OBLIGATIONS; LABOR DISPUTES ................... 28
4A. CLOSING ....................................................... 29
4A.01 NOTES ................................................. 29
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4A.02 RESOLUTIONS/INCUMBENCY ................................ 29
4A.03 LEGAL OPINION ......................................... 29
4A.04 CONSUMMATION OF ACQUISITION ........................... 29
4A.05 ACQUISITION DOCUMENTS ................................. 29
4A.06 FINANCIAL STATEMENTS .................................. 30
4A.07 DOCUMENTATION FEE ..................................... 30
4A.08 CLOSING FEE ........................................... 30
4A.09 OTHER DOCUMENTS ....................................... 30
4B. REPRESENTATIONS/WARRANTIES .................................... 31
4B.01 EXISTENCE ............................................. 31
4B.02 GOVERNMENTAL RESTRICTIONS ............................. 31
4B.03 POWER, AUTHORIZATION AND CONSENT;
ENFORCEABILITY .............................................. 31
4B.04 LITIGATION; PROCEEDINGS ............................... 32
4B.05 TAXES ................................................. 32
4B.06 TITLE ................................................. 32
4B.07 LAWFUL OPERATIONS ..................................... 32
4B.08 INSURANCE ............................................. 32
4B.09 FINANCIAL STATEMENTS .................................. 32
4B.10 INDEBTEDNESS .......................................... 33
4B.11 ERISA ................................................. 33
4B.12 ADVERSE OBLIGATIONS; LABOR DISPUTES ................... 33
4B.13 SOLVENCY .............................................. 33
4B.14 INVESTMENT COMPANY ACT STATUS ......................... 33
4B.15 REGULATION U/REGULATION X COMPLIANCE .................. 34
4B.16 ENVIRONMENTAL AND SAFETY MATTERS ...................... 34
4B.17 REAL PROPERTY ......................................... 34
4B.18 LEASES ................................................ 34
4B.19 INTELLECTUAL PROPERTY ................................. 35
4B.20 DEFAULTS .............................................. 35
4B.21 NOTEHOLDERS AND NOTE PURCHASE AGREEMENT ............... 35
4B.22 FULL DISCLOSURE ....................................... 35
4B.23 CONSUMMATION OF ACQUISITION ........................... 35
4C. CLOSING ....................................................... 35
5A. EVENTS OF DEFAULT ............................................ 35
5A.01 PAYMENTS .............................................. 35
5A.02 WARRANTIES ............................................ 36
5A.03 COVENANTS WITHOUT GRACE ............................... 36
5A.04 COVENANTS WITH GRACE .................................. 36
5A.05 CROSS-DEFAULT ......................................... 36
5A.06 CONTROL ............................................... 36
5A.07 BORROWER'S SOLVENCY ................................... 37
5A.08 SUBSIDIARIES' SOLVENCY ................................ 37
5A.09 JUDGMENTS ............................................. 37
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5A.10 MATERIAL ADVERSE CHANGE ............................... 37
5B. EFFECTS OF DEFAULT ............................................ 37
5B.01 OPTIONAL DEFAULTS ..................................... 37
5B.02 AUTOMATIC DEFAULTS .................................... 38
5B.03 OFFSETS ............................................... 38
5B.04 EQUALIZATION .......................................... 38
6A. INDEMNITY: STAMP TAXES ........................................ 39
6B. INDEMNITY: GOVERNMENTAL COSTS/LIBOR-RATE LOANS ................ 39
6C. INDEMNITY: FUNDING COSTS ...................................... 39
6D. CREDIT REQUESTS ............................................... 39
6E. INDEMNITY: UNFRIENDLY TAKEOVERS ............................... 40
6F. INDEMNITY: CAPITAL REQUIREMENTS ............................... 40
6G. INDEMNITY: COLLECTION COSTS ................................... 40
6H. CERTIFICATE FOR INDEMNIFICATION ............................... 40
7A. BANK'S PURPOSE ................................................ 41
7B. NCB-AGENT ..................................................... 41
7B.01 NATURE OF APPOINTMENT ................................. 41
7B.02 NCB AS A BANK; OTHER TRANSACTIONS ..................... 41
7B.03 INSTRUCTION FROM BANKS ................................ 41
7B.04 BANKS' DILIGENCE ...................................... 42
7B.05 NO IMPLIED REPRESENTATIONS ............................ 42
7B.06 SUB-AGENTS ............................................ 42
7B.07 NCB-AGENT'S DILIGENCE ................................. 42
7B.08 NOTICE OF DEFAULT ..................................... 42
7B.09 NCB-AGENT'S LIABILITY ................................. 42
7B.10 COMPENSATION .......................................... 43
7B.11 DISBURSEMENTS ......................................... 43
7B.12 NCB-AGENT'S INDEMNITY ................................. 43
7B.13 RESIGNATION ........................................... 43
7C. TRANSFER OF SUBJECT LOANS ..................................... 44
7C.01 PRIOR CONSENT ......................................... 44
7C.02 AGREEMENT ............................................. 44
7C.03 NOTE .................................................. 44
7C.04 PARTIES ............................................... 44
7C.05 PROCESSING FEE ........................................ 44
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7D. PARTICIPATION OF SUBJECT LOANS ................................ 44
8. INTERPRETATION ................................................ 45
8.01 WAIVERS ............................................... 45
8.02 CUMULATIVE PROVISIONS ................................. 45
8.03 BINDING EFFECT ........................................ 45
8.04 SURVIVAL OF PROVISIONS ................................ 46
8.05 IMMEDIATE U.S. FUNDS .................................. 46
8.06 CAPTIONS .............................................. 46
8.07 SUBSECTIONS ........................................... 46
8.08 ILLEGALITY ............................................ 46
8.09 OHIO LAW .............................................. 46
8.10 INTEREST/FEE COMPUTATIONS ............................. 46
8.11 NOTICE ................................................ 46
8.12 ACCOUNTING TERMS ...................................... 47
8.13 ENTIRE AGREEMENT ...................................... 47
8.14 WAIVER OF JURY TRIAL .................................. 47
8.15 LATE CHARGE; APPLICATION OF PAYMENTS .................. 47
8.16 EXPENSES .............................................. 47
8.17 JURISDICTION AND VENUE ................................ 48
8.18 AMBIGUITIES ........................................... 48
8.19 OTHER WAIVERS AND ACKNOWLEDGMENT ...................... 48
8.20 CONFIDENTIALITY ....................................... 49
9. DEFINITIONS ................................................... 49
Acceptable Marketable Securities .............................. 49
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Account Officer ............................................... 49
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Accumulated Funding Deficiency ................................ 50
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Acquisition ................................................... 50
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Acquisition Agreement ......................................... 50
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Acquisition Documents ......................................... 50
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Acquisition Projections ....................................... 50
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Adjusted Funded Indebtedness/EBITDA Ratio ..................... 50
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Advantage ..................................................... 50
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Affiliate ..................................................... 50
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Agreement ..................................................... 50
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Bank .......................................................... 50
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Banking Day ................................................... 50
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Borrower ...................................................... 51
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CERCLA ........................................................ 51
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Company ....................................................... 51
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and Companies ................................................. 51
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Compensation .................................................. 51
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Conversion/Continuation Request ............................... 51
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Credit Request ................................................ 51
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Current Assets ................................................ 51
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Current Guarantors ............................................ 51
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Current Liabilities ........................................... 51
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Debt .......................................................... 51
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Default Under ERISA ........................................... 51
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Default Under This Agreement .................................. 52
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Distribution .................................................. 52
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EBITDA ........................................................ 52
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Environmental Law ............................................. 52
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ERISA ......................................................... 52
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ERISA Affiliate ............................................... 52
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ERISA Regulator ............................................... 52
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Eurocurrency Liabilities ...................................... 52
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Eurocurrency Reserve Percentage ............................... 53
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Event Of Default .............................................. 53
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Expiration Date ............................................... 53
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Federal Funds Rate ............................................ 53
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Funded Indebtedness ........................................... 53
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Funded Indebtedness/EBITDA Ratio .............................. 54
--------------------------------
GAAP .......................................................... 54
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Guarantor ..................................................... 54
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Insider ....................................................... 54
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Insolvency Action ............................................. 54
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LIBOR Contract Period ......................................... 54
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LIBOR Loan .................................................... 54
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LIBOR Pre-Margin Rate ......................................... 55
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Material Contract ............................................. 55
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Maturity ...................................................... 55
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Maximum Outstanding Amount .................................... 56
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Most Recent 4A.04 Financial Statements ........................ 56
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NCB ........................................................... 56
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Net Income .................................................... 56
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Net Offering Proceeds ......................................... 56
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Note Purchase Agreement ....................................... 56
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Noteholders ................................................... 56
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Pension Plan .................................................. 56
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Person ........................................................ 56
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Post-Refinancing Amount ....................................... 56
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PR Loan ....................................................... 56
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Prime Rate .................................................... 56
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Prior Credit Agreement ........................................ 57
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Proforma Covenant Compliance .................................. 57
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Projections ................................................... 57
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Ratable and Ratably ........................................... 57
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Refinancing ................................................... 57
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Refinancing Date .............................................. 57
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Refinanced Amount ............................................. 57
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Reimbursement Agreement ....................................... 57
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Related Writing ............................................... 57
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Reportable Event .............................................. 58
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Required Banks ................................................ 58
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Revolving Commitment .......................................... 58
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Revolving Loan ................................................ 58
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Revolving Series .............................................. 58
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Seller ........................................................ 58
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Series ........................................................ 58
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Stockholders' Equity .......................................... 58
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Subject Indebtedness .......................................... 58
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Subject LC .................................................... 59
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Subject Loan .................................................. 59
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Subject Note .................................................. 59
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Subordinated .................................................. 59
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Subsidiary .................................................... 59
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Supplemental Schedule ......................................... 59
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Target ........................................................ 59
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Term Note ..................................................... 59
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Term Series ................................................... 59
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Type .......................................................... 59
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Total Liabilities ............................................. 59
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plurals ....................................................... 59
10. EXECUTION ..................................................... 60
EXHIBIT A: Supplemental Schedule (4B)
EXHIBIT B: Form of Term Note (2A.01; 4A.01)
EXHIBIT C: Form of Revolving Note (2C.01; 4A.01)
EXHIBIT D: Form of Extension Agreement (2B.05)
EXHIBIT E: Form of Credit Request (2C.02)
EXHIBIT F: Form of Conversion/Continuation Request (2D.07)
EXHIBIT G: List of Subsidiaries (4B.01)
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
--------------------------------------------
This Second Amended and Restated Credit Agreement (this "Agreement") is made as
of January 21, 1997 by and among OM GROUP, INC. ("Borrower") and the Banks named
in section 2A below (the "Banks") and NATIONAL CITY BANK as agent (in that
capacity, "NCB-Agent") of the Banks for the purposes of this Agreement and the
Related Writings:
1A. CROSS-REFERENCE -- Certain capitalized terms and phrases used but not
otherwise defined in the body hereof are defined in section 9 below.
1B. SUMMARY -- This Agreement
(a) provides that concurrently with the execution and delivery of this
Agreement the Banks shall disburse the Term Loan described in section 2A,
(b) sets forth the terms and conditions upon which Borrower may, so long as
the Revolving Commitments remain in effect, obtain the Revolving Loans
described in sections 2B and 2C until the Expiration Date,
(c) provides means whereby Borrower may, if the Banks in each case consent,
from time to time until January 21, 2001, have issued for Borrower's
account standby letters of credit, and
(d) sets forth the covenants and warranties made by the parties to induce
the other parties hereto to enter into this Agreement.
This Agreement replaces the Prior Credit Agreement.
2A. TERM LOANS -- Subject to the terms and conditions of this Agreement,
concurrently with the execution and delivery of this Agreement, the Banks agree
to make (subject to the maximum Term Loan amounts set forth below, (a) one time
term loans in an aggregate principal amount of One Hundred Twenty Million
Dollars ($120,000,000) (the "Term Loans"), the proceeds of which will be
disbursed to the credit of Borrower's general checking account with NCB-Agent in
the absence of written instructions from Borrower to the contrary. The Term
Loans shall be comprised of one or more Term Series, as the Borrower may elect
from time to time by delivery to the Bank of a Conversion/Continuation Request
pursuant to subsection 2D.07 (provided, however that the Term Loans made on the
date of this Agreement must consist entirely of Prime Rate Loans, although
Borrower may subsequently convert such Prime Rate Loans to LIBOR Loans pursuant
to subsection 2D.07). The Term Loans may be prepaid permanently from time to
time pursuant to subsection 2D.08 The amount of each Bank's maximum Term Loan
(subject to such optional prepayment) and the proportion (expressed as a
percentage) that it bears to all of the Term Loans is set forth opposite the
Bank's name below to-wit:
10
Max Term Loan Percentage Bank
------------- ---------- ----
$42,500,000 35.42% National City Bank
$40,000,000 33.33% ABN AMRO Bank N.V.
$18,750,000 15.625% KeyBank National Association
$18 750 000 15.625% Mellon Bank, N.A.
----------- ------- -----------------
$120,000,000 100%
============ ====
2A.01 TERM NOTE -- Each Bank's Term Loan shall be evidenced at all times by a
Term Note executed and delivered by Borrower payable to the order of that Bank
in a principal amount equal to the dollar amount of that Bank's maximum Term
Loan and being in the form and substance of EXHIBIT B with the blanks
appropriately filled.
▇▇.▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇/▇▇▇▇▇▇▇▇▇▇▇ --The aggregate principal balance of the Term
Loans shall become due and payable on the Refinancing Date. Subject to the
satisfaction of the condition set forth in section 4C, on the Refinancing Date,
the aggregate outstanding principal balance of the Term Loans shall be paid in
full, together with any accrued interest thereon, with (a) Net Offering
Proceeds, if any, and (b) proceeds resulting from the increase in the
outstanding aggregate principal balance of the Revolving Loans in an amount
equal to the Refinanced Amount.
2A.03 INTEREST: PR LOANS -- The principal of and overdue interest on each Term
Series comprised of PR Loans shall bear interest payable in arrears on the first
(1st) day of each month, commencing March 1, 1997, and at Maturity and computed
(in accordance with subsection 8.10) at a fluctuating rate equal to the Prime
Rate from time to time in effect, with each change in the Prime Rate
automatically and immediately changing the rate thereafter applicable to any
Term Series comprised of PR Loans; PROVIDED, that in no event shall the rate
applicable to any Term Series comprised of PR Loans at any time after the
Maturity thereof be less than the rate applicable thereto immediately after
Maturity regardless of future reductions in the Prime Rate.
2A.04 INTEREST: LIBOR LOANS -- The principal of and overdue interest on each
Term Series comprised of LIBOR Loans shall bear interest computed (in
accordance with subsection 8.10) and payable as follows:
(a) Each Term Series comprised of LIBOR Loans shall bear interest at a
rate equal to the LIBOR Pre-Margin Rate in effect at the start of the
applicable LIBOR Contract Period selected by Borrower in the applicable
Conversion/Continuation Request PLUS the applicable "Margin". The
applicable "Margin" shall be dependent on the Companies' consolidated
Adjusted Funded Indebtedness/EBITDA Ratio as of the end of any given
fiscal quarter and shall be determined as follows:
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Adjusted Funded Indebtedness/EBITDA Ratio Margin
----------------------------------------- ------
>3.00 & <3.25 1.25%
-
<3.00 1.00%
-
The interest rate applicable to a Term Series comprised of LIBOR
Loans prior to Maturity shall initially be equal to the LIBOR
Pre-Margin Rate plus one percent (1.00%); provided that the
applicable Margin shall be adjusted quarterly upon the Banks'
receipt of (i) the financial statements contemplated in
subsections 3A.01(a) and 3A.0l(b) below and (ii) a corresponding
certificate complying with subsection 3A.01 (c) based on the
Companies' consolidated Adjusted Funded Indebtedness/ EBITDA
Ratio as of the end of the respective fiscal quarter and
effective at the beginning of the first fiscal quarter
subsequent to such receipt.
(b) Interest on each Term Series comprised of LIBOR Loans shall
be payable in arrears on the last day of the LIBOR Contract
Period applicable thereto and at Maturity.
2A.05 CLOSING FEE -- In consideration of Banks' efforts in arranging the
financing and consummating the transactions contemplated by this
Agreement, at the execution and delivery of this Agreement, Borrower
agrees to pay a fee in the amount of $210,000 to be shared by the Banks
Ratably.
2A.06 DELAYED REPAYMENT FEE -- Borrower hereby agrees that, in the event
that Borrower fails to complete a public equity offering on or prior to
April 22, 1997, for which the Net Offering Proceeds are equal to or
greater than Sixty Million Dollars ($60,000,000), then Borrower shall,
on such date, pay a fee in the amount of $180,000 to be shared by the
Banks Ratably.
2B. REVOLVING COMMITMENTS -- The basic terms of the Revolving Commitments
and the compensation therefor are as follows:
2B.01 AMOUNT -- The aggregate amount of the Revolving Commitments shall
be: (a) for the period commencing with the date of the execution of this
Agreement and concluding on the day immediately preceding the
Refinancing Date, an amount equal to One Hundred Twenty Million Dollars
($120,000,000); and (b) for the period commencing with the Refinancing
Date and concluding on the Expiration Date (as defined in subsection
2B.02), an amount equal to the lesser of (i) Two Hundred Forty Million
Dollars ($240,000,000) or (ii) the Post-Refinancing Amount.
Notwithstanding the foregoing: the Revolving Commitments shall be
permanently reduced pursuant to subsection 2B.06; the Revolving
Commitments may be reduced permanently from time to time pursuant to
subsection 2B.03; and the Revolving Commitments may be terminated
pursuant to section 5B. The amount of each Bank's maximum Revolving
Commitment (subject to such reduction or termination) and the proportion
(expressed as a percentage) that it bears to all of the Revolving
Commitments is set forth opposite the Bank's name below to-wit:
3
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Max Rev Commitment Percentage Bank
------------------ ---------- ----
$85,000,000 35.42% National City Bank
$80,000,000 33.33% ABN AMRO Bank N.V.
$37,500,000 15.625% KeyBank National Association
$37,500 000 15.625% Mellon Bank. N.A.
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$240,000,000 100%
============ ====
Each Bank agrees, subject to the terms and conditions of this Agreement, to
participate Ratably in such Subject LCs as may be issued from time to time at
Borrower's request in accordance with section 2E. Pursuant to subsection 2A.02
hereof, as of the Refinancing Date, the remaining aggregate outstanding
principal balance of the Term Loans after application of the Net Offering
Proceeds shall be paid in full by an increase in the outstanding aggregate
principal balance of the Revolving Loans.
2B.02 EXPIRATION -- Each Revolving Commitment shall become effective as
of the date of this Agreement and shall remain in effect on a revolving
basis until January 31, 2002 (the "Expiration Date") EXCEPT that a later
Expiration Date may be established from time to time pursuant to
subsection 2B.05 and EXCEPT FURTHER that the Revolving Commitments,
shall end in any event upon any earlier reduction thereof to zero
pursuant to subsection 2B.03 or any earlier termination pursuant to
section 5B.
2B.03 OPTIONAL REDUCTIONS -- Borrower shall have the right, at all times
and without the payment of a premium, to reduce the amount of the
Revolving Commitments permanently in whole or in part by giving
NCB-Agent notice (to be given not later than 12:00 noon of the Banking
Day next preceding the effective date of the reduction and either to be
given in writing or to be promptly confirmed in writing) of the
aggregate amount by which the Revolving Commitments are to be reduced
and the effective date of any such reduction, subject, however to the
following:
(a) No such reduction shall reduce any Bank's Revolving
Commitment to a lesser amount than the sum of
(1) the aggregate unpaid principal balance of that Bank's
Revolving Loans comprised of LIBOR Loans outstanding at
that time PLUS
(2) the aggregate unpaid principal balance of any of that
Bank's Revolving Loans comprised of LIBOR Loans to be
obtained pursuant to any unfulfilled Credit Request under
subsection 2C.02 PLUS
(3) the aggregate undrawn balance of the Subject LCs then
outstanding.
(b) Each such reduction of the Revolving Commitments shall
aggregate One Million Dollars ($1,000,000) or any multiple
thereof.
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(c) Concurrently with each reduction Borrower shall make a
principal payment on each Bank's Revolving Loans then
outstanding in a principal amount equal to the excess of (1) the
sum of the aggregate outstanding principal balance of the
Revolving Loans PLUS the aggregate undrawn balance of the
Subject LCs then outstanding, over (2) the aggregate amount of
the Revolving Commitments as so reduced. Subsection 2D.08 and
section 6C shall apply to each such prepayment.
2B.04 COMMITMENT FEE -- Each Bank shall, so long as its Revolving
Commitment remains in effect, earn commitment fees for the Revolving
Commitment attributable to such Bank, the commitment fee shall be (a)
based on the average daily difference between (i) that Bank's Revolving
Commitment from time to time in effect and (ii) the sum of (A) that
Bank's Ratable share of the aggregate undrawn amount of the Subject LCs
then outstanding PLUS (B) the aggregate unpaid principal balance of that
Bank's Revolving Loans then outstanding, (b) computed at the rate per
annum determined by reference to the Companies' consolidated Adjusted
Funded Indebtedness/EBITDA Ratio as of the end of the most recent fiscal
quarter at the time such fee is due as follows:
(i) for the period commencing with the date of the execution of
this Agreement and concluding on the day immediately preceding
the Refinancing Date
Adjusted Funded Indebtedness/EBITDA Ratio Commitment Fee
----------------------------------------- --------------
> 3.00 & < 3.25 .375%
-
> 2.50 & < 3.00 .350%
-
> 2.00 & < 2.50 .300%
-
> 1.50 & < 2.00 .250%
-
> 1.00 & < 1.50 .200%
-
< 1.0 .150%
-
(ii) for the period commencing with the Refinancing Date and
concluding on the Expiration Date and in the event that Borrower
completes a public equity offering for which the Net Offering
Proceeds are equal to or greater than Sixty Million Dollars
($60,000,000)
Adjusted Funded Indebtedness/EBITDA Ratio Commitment Fee
----------------------------------------- --------------
> 2.00 & < 2.50 .300%
-
> 1.50 & < 2.00 .250%
-
> 1.00 & < 1.50 .200%
-
< 1.0 .150%
-
(iii) for the period commencing with the Refinancing Date and
concluding on the Expiration Date and in the event that Borrower
fails to complete a public equity offering for which the Net
Offering Proceeds are equal to or greater than Sixty Million
Dollars ($60,000,000)
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Adjusted Funded Indebtedness/EBITDA Ratio Commitment Fee
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> 3.00 & < 3.25 .375%
-
> 2.50 & < 3.00 .350%
-
> 2.00 & < 2.50 .300%
-
> 1.50 & < 2.00 .250%
-
> 1.00 & < 1.50 .200%
-
< 1.0 .150%
and (c) payable in arrears by Borrower to NCB-Agent for the account of
the Banks on April 1, 1997 and quarter-annually thereafter on the first
day of each quarter and at the end of the Revolving Commitments.
2B.05 EXTENSION OF REVOLVING COMMITMENT -- In the event that Borrower
completes a public equity offering for which the Net Offering Proceeds
are equal to or greater than Sixty Million Dollars ($60,000,000),
Borrower may request extensions of the Revolving Commitments as
follows: whenever Borrower furnishes its audited financial statements
to Banks pursuant to clause (b) of subsection 3A.0l, commencing with
the year ending December 31, 1997, Borrower may request that the
Revolving Commitments be extended one year following the Expiration
Date then in effect. Each such request shall be executed and delivered
to each Bank in triplicate and shall be in the form of EXHIBIT D with
all blanks appropriately filled. Banks agree to give consideration to
each such request; but in no event shall any Bank be committed to
extend its Revolving Commitment, nor shall any Bank's Revolving
Commitment be so extended, unless and until every Bank has executed and
delivered the form of assent in EXHIBIT D.
2B.06 MANDATORY REDUCTIONS -- The Revolving Commitments shall reduce
automatically on an annual basis, commencing on January 31, 1998, and
continuing on each January 31 thereafter through January 31, 2002, in
an annual amount equal to twenty percent (20%) of the difference
between (a) the Post-Refinancing Amount LESS (b) One Hundred Eighty
Million Dollars ($180,000,000). No such reductions shall be required if
the Net Offering Proceeds are at least Sixty Million Dollars
($60,000,000). Subsection 2D.08 and section 6C shall apply to any
prepayments of Revolving Loans made by Borrower in connection with such
mandatory reductions.
2C. REVOLVING LOANS -- Each Bank (for itself only and not for the others) agrees
that, so long as its Revolving Commitment remains in effect, it will, subject to
the conditions of this Agreement, grant Borrower such Revolving Loans as
Borrower may from time to time request.
2C.01 REVOLVING NOTE -- Each Bank's Revolving Loans shall be evidenced
at all times by, (i) prior to the Refinancing Date, a Revolving Note
executed and delivered by Borrower, payable to the order of that Bank
in a principal amount equal to one-half of the dollar amount of that
Bank's maximum Revolving Commitment (as set forth in the table in
subsection 2B.01) (the "Initial Revolving Note") and being in the form
and substance of EXHIBIT C with the blanks appropriately filled, and
(ii) on and after the Refinancing Date, a Revolving Note executed and
delivered by Borrower, payable to the
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order of that Bank in a principal amount equal to the dollar amount of that
Bank's maximum Revolving Commitment as in effect as of the Refinancing (taking
into account the Refinancing) (the "Refinancing Revolving Note") and being in
the form and substance of EXHIBIT C with the blanks appropriately filled.
(a) Whenever Borrower shall obtain a Revolving Series, each Bank shall
endorse an appropriate entry on the Revolving Note or make an
appropriate entry in a loan account in that Bank's books and records,
or both. Each entry shall be prima facie evidence of the data entered;
but such entries shall not be a condition to Borrower's obligation to
pay.
(b) No holder of any Revolving Note shall transfer a Revolving Note or
seek a judgment or file a proof of claim based on a Revolving Note,
without in each case first endorsing the Revolving Note to reflect the
true amount owing thereon.
2C.02 CREDIT REQUESTS -- Whenever Borrower desires to obtain a Revolving Series,
Borrower shall give NCB-Agent an appropriate notice (a "Credit Request") which
shall be irrevocable and shall be in the form of EXHIBIT E (or in other form and
detail reasonably satisfactory to NCB-Agent) with the blanks appropriately
filled. NCB-Agent shall give each Bank immediate notice of each Credit Request.
Borrower may make its request by telephone PROVIDED it promptly confirms the
request by a written request as aforesaid, Borrower hereby agreeing to assume
the risk of a misunderstanding in the case of any telephone request. Except in
the case of Revolving Series obtained at the execution and delivery of this
Agreement the Credit Request is to be given not later than 12:00 noon of the
Banking Day on which the loan proceeds are to be disbursed EXCEPT in the case of
any Revolving Series comprised of LIBOR Loans in which latter case the Credit
Request shall be given not later than 12:00 noon of the third (3rd) Banking Day
prior to the day the proceeds are to be disbursed.
2C.03 CONDITION: NO DEFAULT -- Borrower shall not be entitled to obtain any
Revolving Series if
(a) any Default Under This Agreement shall then exist or would
thereupon begin to exist or
(b) any representation or warranty made in subsections 4B.01 through
4B.08 (both inclusive) or 4B.10 through 4B.21 (both inclusive) shall
have ceased to be true and complete in any material respect except for
such changes if any as shall have been fully disclosed in the
applicable Credit Request and as may be waived by the Required Banks in
the reasonable exercise of their discretion, or
(c) there shall have occurred any material adverse change in Borrowers
financial condition, properties or business since the date of
Borrower's Most Recent 4A.04 Financial Statements.
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Each Credit Request, both when made and when honored, shall of itself constitute
a continuing representation and warranty by Borrower to NCB-Agent for the
benefit of the Banks that Borrower is entitled to obtain a Revolving Series.
2C.04 INTEREST: PR LOANS -- The principal of and overdue interest on any
Revolving Series comprised of PR Loans shall bear interest payable in arrears on
the first (1st) day of each month, commencing March 1, 1997, and at Maturity
and computed (in accordance with subsection 8.10)
(a) prior to Maturity, at a fluctuating rate equal to the Prime Rate
from time to time in effect, and
(b) after Maturity (whether occurring by lapse of time or by
acceleration), at a fluctuating rate equal to the Prime Rate from time
to time in effect plus three percent (3%) per annum,
with each change in the Prime Rate automatically and immediately changing the
rate thereafter applicable to any Revolving Series comprised of PR Loans;
PROVIDED, that in no event shall the rate applicable to any Revolving Series of
comprised of PR Loans at any time after the Maturity thereof be less than the
rate applicable thereto immediately after Maturity regardless of future
reductions in the Prime Rate.
2C.05 INTEREST: LIBOR LOANS -- The principal of and overdue interest on each
Revolving Series comprised of LIBOR Loans shall bear interest computed (in
accordance with subsection 8.10) and payable as follows:
(a) Prior to Maturity, each Revolving Series comprised of LIBOR Loans
shall bear interest at a rate equal to the LIBOR Pre-Margin Rate in
effect at the start of the applicable LIBOR Contract Period selected by
Borrower in the applicable Credit Request PLUS the applicable "Margin".
The applicable "Margin" shall be dependent on the Companies'
consolidated Adjusted Funded Indebtedness/EBITDA Ratio as of the end of
any given fiscal quarter and shall be determined as follows:
(i) for the period commencing with the date of the execution of
this Agreement and concluding on the day immediately preceding
the Refinancing Date
Adjusted Funded Indebtedness/EBITDA Ratio Margin
----------------------------------------- ------
> 3.00 & < 3.25 1.25%
-
> 2.50 & < 3.00 1.00%
-
> 2.00 & < 2.50 0.75%
-
> 1.50 & < 2.00 0.60%
-
> 1.00 & < 1.50 0.50%
-
< 1.0 0.35%
-
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(ii) for the period commencing with the Refinancing Date and
concluding on the Expiration Date and in the event that Borrower
completes a public equity offering for which the Net Offering
Proceeds are equal to or greater than Sixty Million Dollars
($60,000,000)
Adjusted Funded Indebtedness/EBITDA Ratio Margin
----------------------------------------- ------
> 2.00 & <2.50 0.75%
-
> 1.50 & <2.00 0.60%
-
> 1.00 & < 1.50 0.50%
-
< 1.0 0.35%
-
(iii) for the period commencing with the Refinancing Date and
concluding on the Expiration Date and in the event that
Borrower fails to complete a public equity offering for which
the Net Offering Proceeds are equal to or greater than Sixty
Million Dollars ($60,000,000)
Adjusted Funded Indebtedness/EBITDA Ratio Margin
----------------------------------------- ------
> 3.00 & < 3.25 1.50%
-
> 2.50 & < 3.00 1.25%
-
> 2.00 & < 2.50 1.00%
-
> 1.50 & < 2.00 0.75%
-
> 1.00 & < 1.50 0.625%
-
< 1.0 0.50%
-
The interest rate applicable to a Revolving Series comprised of LIBOR
Loans prior to Maturity shall initially be equal to the LIBOR Pre-Margin
Rate plus one percent (1.00%); provided that the applicable Margin shall
be adjusted quarterly upon the Banks' receipt of (i) the financial
statements contemplated in subsections 3A.01(a) and 3A.01(b) below and
(ii) a corresponding certificate complying with subsection 3A.01(c),
based on the Companies' consolidated Adjusted Funded Indebtedness/EBITDA
Ratio as of the end of the respective fiscal quarter and effective at
the beginning of the first fiscal quarter subsequent to such receipt.
(b) After Maturity (whether occurring by lapse of time or by
acceleration) each Revolving Series comprised of LIBOR Loans shall bear
interest computed and payable in the same manner as in the case of any
Revolving Series comprised of PR Loans (after Maturity).
(c) Interest on each Revolving Series comprised of LIBOR Loans shall be
payable in arrears on the last day of the LIBOR Contract Period
applicable thereto and at Maturity and, in the case of any Contract
Period having a longer term than three (3) months, shall also be payable
every three (3) months after the first (1st) day of the LIBOR Contract
Period.
2D. GENERAL LOAN PROVISIONS.
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2D.01 CONDITION: PURPOSE -- Borrower shall not use the proceeds of any Subject
Loan in any manner that would violate or be inconsistent with Regulation U or X
of the Board of Governors of the Federal Reserve System; nor will it use any
such proceeds for the purpose of financing the acquisition of any corporation or
other business entity (other than the acquisition of all of the outstanding
capital stock of Target from Seller (the "Acquisition") if the acquisition is
publicly opposed by the latter's management or if Bank deems that its
participation in the financing would involve it in a conflict of interest.
2D.02 LOAN MIX -- The Subject Loans at any one time outstanding may consist of
PR Loans or LIBOR Loans or any combination thereof as Borrower may from time to
time duly elect; provided, that any given Series of Term Loans or Revolving
Loans, as the case may be, shall at all times consist only of PR Loans or only
of LIBOR Loans and, in the case of LIBOR Loans, shall have identical LIBOR
Contract Periods. In no event may Borrower have more than two (2) Term Series
comprised of LIBOR Loans outstanding at any time.
2D.03 AMOUNTS -- Each Revolving Series or Term Series, as the case may be, shall
be divided Ratably among the Banks and shall be in such aggregate principal
amount as Borrower may request subject, however, to the following:
(a) The aggregate principal amount,
in the case of any Revolving Series or Term Series, as the case
may be, comprised of PR Loans, such PR Loans shall be One
Hundred Thousand Dollars ($100,000) or any multiple thereof, and
in the case of any Revolving Series or Term Series, as the case
may be, comprised of LIBOR Loans, such LIBOR Loans shall be One
Million Dollars ($1,000,000) or any greater amount that is a
multiple of One Hundred Thousand Dollars ($100,000),
(b) In no event shall the unpaid principal amount of the Revolving
Loans owing to any Bank at any time exceed the difference of (i) the
amount of that Bank's Revolving Commitment as then in effect less (ii)
that Bank's Ratable share of the aggregate undrawn balance of the
Subject LCs then outstanding.
2D.04 LIBOR CONTRACT PERIODS -- Each Revolving Series or Term Series, as the
case may be, comprised of LIBOR Loans shall have applicable thereto a LIB OR
Contract Period to be duly elected by Borrower in the Credit Request or
Conversion/Continuation Request therefor. Each LIBOR Contract Period shall begin
on the date of borrowing of each such Series and shall end on such date as
Borrower may select subject, however, to the following:
(a) The LIBOR Contract Period for each Revolving Series or Term Series.
as the case may be, comprised of LIBOR Loans shall end, (i) in the case
of such a
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Revolving Series, one (I) two (2) three (3) or six (6) months after the
date of borrowing, and (ii) in the case of such a Term Series, one (1)
month after the date of borrowing or conversion/continuation, as the
case may be; PROVIDED, that
(1) if any such LIBOR Contract Period otherwise would end on a
day that is not a Banking Day, it shall end instead on the next
following Banking Day unless that day falls in another calendar
month in which latter case the LIBOR Contract Period shall end
instead on the last Banking Day of the next preceding calendar
month,
(2) if any such LIBOR Contract Period commences on a day which
is the last day of the calendar month, it shall end on the last
day of the next following calendar month, subject to subsection
2D.04(a)(1), and
(3) if the LIBOR Contract Period commences on a day for which
there is no numerical equivalent in the calendar month in which
the LIBOR Contract Period is to end, it shall end on the last
Banking Day of that calendar month.
(b) Borrower shall never elect a LIBOR Contract Period for a Revolving
Series the term of which extends beyond the Expiration Date. In
addition, Borrower shall never elect a LIBOR Contract Period for a
Revolving Series the term of which extends beyond any January 31,
commencing with January 31, 1998, unless, after giving effect to such
selection, the aggregate outstanding principal balance of all Revolving
Series comprised of PR Loans, together with the aggregate outstanding
principal balance of all Revolving Series comprised of LIBOR Loans
which have LIBOR Contract Periods ending on or prior to such January
31, shall be at least equal to that portion of the aggregate principal
amount of such Revolving Series due and payable on and prior to such
January 31.
(c) Borrower shall never elect a LIBOR Contract Period for a Term
Series the term of which extends beyond June 30, 1997.
2D.05 MATURITIES -- The stated Maturity of any Revolving Series comprised of PR
Loans shall be (subject to any mandatory reductions of the Revolving Commitments
pursuant to subsection 2B.06) the Expiration Date. The stated Maturity of any
Term Series comprised of PR Loans shall be the Refinancing Date. The stated
Maturity of each Term Series or Revolving Series, as the case may be, comprised
of LIBOR Loans shall be the last day of the LIBOR Contract Period applicable
thereto. In no event, however, shall (a) the stated Maturity of any Revolving
Loan be later than the Expiration Date, and (b) the stated Maturity of any Term
Loan be later than June 30, 1997.
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2D.06 ROLLOVER OR REFINANCING OF REVOLVING LOANS -- Upon delivery of a timely
Credit Request in accordance with subsection 2C.02 and subject to any other
conditions or limitations of this Agreement, Borrower may refinance all or any
part of any Revolving Series with another Revolving Series of the same or a
different Type. Any Revolving Series or part thereof so refinanced shall be
deemed to be repaid or prepaid, as applicable, with the proceeds of a new
Revolving Series. If
(a) prior to the Expiration Date any Revolving Series comprised of LIBOR
Loans shall not be paid in full at the stated Maturity thereof, and
(b) Borrower shall have failed to duly give NCB-Agent a timely Credit
Request in respect thereof,
Borrower shall be deemed to have duly given NCB-Agent a timely Credit Request to
obtain (and at that Maturity the Banks shall make) a Revolving Series comprised
of PR Loans in an aggregate principal amount equal to the aggregate unpaid
principal of the Revolving Series comprised of LIBOR Loans then due the proceeds
of which Revolving Series comprised of PR Loans shall be applied to the payment
in full of the Revolving Series comprised of LIBOR Loans then due; PROVIDED that
no such Revolving Series comprised of PR Loans shall of itself constitute a
waiver of any then-existing Default Under This Agreement.
2D.07 CONTINUATION/CONVERSION OF TERM LOANS -- Borrower shall have the right to
convert or continue any Term Series comprised of LIBOR Loans or PR Loans, as the
case may be, upon notice and request delivered by Borrower to NCB-Agent not
later than 12:00 noon (a) on the Banking Day that Borrower desires to convert
any Term Series comprised of LIBOR Loans to a Term Series comprised of PR Loans,
(b) three (3) Banking Days prior to the Banking Day on which Borrower desires to
convert any portion of a Term Series comprised of PR Loans to a Term Series
comprised of LIBOR Loans for a given LIBOR Contract Period, and (c) three (3)
Banking Days prior to the Banking Day on which Borrower desires to continue any
Term Series comprised of LIBOR Loans as another Term Series comprised of LIBOR
Loans; PROVIDED, that each such conversion or continuation shall be subject to
the following:
(i) if less than all the outstanding principal amount of a Term Series
comprised of PR Loans or LIBOR Loans, as the case may be, is converted
or continued, the aggregate principal amount of such Term Series being
converted or continued shall be: (A) in the case of a Term Series
comprised of LIBOR Loans, not less than One Million Dollars ($1,000,000)
or a multiple thereof, or (B) in the case of a Term Series comprised of
PR Loans, One Hundred Thousand Dollars ($100,000),
(ii) each such conversion or continuation shall be effected as if the
Banks were applying the proceeds of the Loans resulting from such
conversion or continuation to that portion of the Term Loans being
converted or continued, as the case may be, and the accrued interest on
such portion of the Term Loans being converted
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21
or continued shall be paid to NCB-Agent by Borrower at the time of such
conversion or continuation,
(iii) no LIBOR Loans shall be converted or continued at any time unless
Borrower shall promptly pay any amounts due to the Banks pursuant to
subsection 2D.08 or section 6C,
(iv) Loans that cannot be converted into or continued as LIBOR Loans by
reason of clauses (iii) or (v) of this subsection 2D.07 shall be
automatically converted at the end of the LIBOR Contract Period in
effect for such Term Series comprised of LIBOR Loans into a Term Series
comprised of PR Loans, and
(v) no LIBOR Contract Period can be selected in connection with any
conversion or continuation with respect to any Term Series comprised of
LIBOR Loans which ends after June 30, 1997.
Each such request for a conversion or continuation (a "Conversion/Continuation
Request") shall be irrevocable and shall be in the form of EXHIBIT F (or in
other form and detail reasonably satisfactory to NCB-Agent) with the blanks
appropriately filled. NCB-Agent shall give each Bank immediate notice of each
Conversion/Continuation Request. Borrower may make its request by telephone
PROVIDED it promptly confirms the request by a written request as aforesaid,
Borrower hereby agreeing to assume the risk of a misunderstanding in the case of
any telephone request.
2D.08 PREPAYMENTS -- Borrower may from time to time prepay the principal of any
Series comprised of PR Loans or LIBOR Loans, as the case may be, in whole or in
part, subject to the following:
(a) Borrower shall give NCB-Agent an appropriate notice not later than
12:00 noon on the Banking Day next preceding any such prepayment, which
notice, if not originally given in writing, shall be promptly confirmed
in writing. NCB-Agent shall promptly report the notice to each Bank.
(b) Each prepayment of a Series comprised of PR Loans shall aggregate
the principal amount of One Hundred Thousand Dollars ($100,000) or any
multiple thereof or an amount equal to the then aggregate principal
outstanding and shall be allocated thereto Ratably. Each prepayment of a
Series comprised of LIBOR Loans shall aggregate One Million Dollars
($1,000,000) or any greater amount that is a multiple of One Hundred
Thousand Dollars ($100,000) or an amount equal to the aggregate unpaid
principal balance of that Series comprised of LIBOR Loans and shall be
applied Ratably thereto.
(c) Each prepayment of a Series comprised of PR Loans may be made
without penalty or premium. Any prepayment of a Series comprised of
LIBOR Loans (regardless of the reason for the prepayment) shall be
subject to the payment of
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any indemnity required by section 6C; provided, however, Borrower shall
not be required to repay any Series of Term Loans comprised of LIBOR
Loans which constitute all or a portion of the Refinanced Amount.
(d) Prior to the Expiration Date no prepayment shall of itself reduce
any Revolving Commitment.
(e) Concurrently with each prepayment, Borrower shall prepay the
interest accrued on the prepaid principal.
(f) Prior to the Refinancing Date Borrower shall not prepay any portion
of the Term Loans unless the then aggregate outstanding principal amount
of the Revolving Loans does not exceed One Hundred Million Dollars
($100,000,000).
2D.09 DISBURSEMENT -- Each Bank may disburse the proceeds of each Subject Loan
made by it from any office selected by that Bank and in each case shall disburse
the same in immediately available funds to Borrower's general checking account
with NCB in the absence of written instructions from Borrower to the contrary,
which funds shall be so disbursed on the Banking Day specified in the Credit
Request for a Revolving Loan and on the date of this Agreement for a Term Loan;
PROVIDED, that this subsection shall not apply to Revolving Loans made pursuant
to subsection 2B.05.
2D.10 LIBOR LOANS: UNAVAILABILITY -- If at any time
(a) NCB-Agent shall determine that dollar deposits of the relevant
amount for the relevant LIBOR Contract Period are not available in the
London interbank market (in the case of LIBOR rates) for the purpose of
funding the LIBOR rates in question, or
(b) NCB-Agent shall reasonably determine that circumstances affecting
that market make it impracticable for NCB-Agent to ascertain LIBOR
rates, or
(c) any Bank shall give NCB-Agent written notice that the costs of that
Bank in funding of any Subject Loans at a LIBOR rate are equal to or
greater than the interest payable by Borrower in respect thereof,
then and in each such case NCB-Agent shall, by written notice to Borrower and to
all the Banks, suspend Borrower's right thereafter to obtain rates of the kind
in question, which suspension shall remain in effect until such time, if any, as
NCB-Agent may give written notice to Borrower that the condition giving rise to
the suspension no longer prevails, which notice NCB-Agent agrees to provide
within thirty (30) days of the end of the condition giving rise to the
suspension.
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2D.11 LIBOR LOANS: ILLEGALITY -- If any Bank shall give NCB-Agent
written notice that it is or any governmental authority has asserted
that it is unlawful for that Bank to fund make or maintain the LIBOR
rates in question,
(a) NCB-Agent shall give Borrower and each of the other Banks
prompt written notice thereof, and
(b) Borrower shall promptly pay in full the principal of and
interest on the LIBOR Loan in question and make the
reimbursement, if any, required by section 6C.
2E. LETTERS OF CREDIT -- NCB-Agent and the Banks agree that so long as all of
the Revolving Commitments remain in effect NCB-Agent will, in NCB's name but
only as agent for the Banks, issue such standby letters of credit (each, a
"Subject LC") for Borrower's account as Borrower may from time to time request
subject, however, to the conditions of this Agreement.
2E.01 RATABLE PARTICIPATION -- Each issuance of a Subject LC shall, of
itself, confer upon each Bank the benefits and liabilities of a
participation constituting an undivided interest in the Subject LC to
the extent of that Bank's Ratable share. Promptly after the issuance
of each Subject LC, NCB-Agent shall notify each Bank of such issuance.
Upon the request of any Bank, NCB-Agent shall notify each Bank of such
issuance. Upon the request of any Bank, NCB-Agent shall deliver a copy
of each Subject LC issued hereunder to such requesting Bank.
2E.02 MAXIMUM -- in addition to the conditions set forth in subsection
2C.03 hereof, NCB-Agent shall not issue any Subject LC if, after
giving effect thereto,
(a) the aggregate undrawn balance of all then outstanding
Subject LCs would exceed Ten Million Dollars ($10,000,000) or
(b) the aggregate undrawn balance of all Subject LCs and any
unreimbursed drawings in respect thereof (to the extent that a
Revolving Series comprises of PR Loans have not been advanced
by Banks in respect thereof) plus any Subject LCs to be issued
pursuant to any unfilled Credit Request under subsection 2C.02
plus the aggregate amount of Revolving Loans outstanding or to
be obtained pursuant to any unfilled Credit Requests would at
any time exceed the aggregate of the Revolving Commitments as
then in effect.
2E.03 TERM -- No Subject LC shall permit any draft to be drawn
thereunder on a date (the "last draw date") that is later than the
third (3rd) Banking Day next preceding the Expiration Date in effect
at the date of issuance of such Subject LC.
2E.04 FORM AND SUBSTANCE -- Each Subject LC shall have terms,
conditions and other provisions that are satisfactory to NCB, shall
expire not more than one year after Borrower's application therefor,
shall be a commercial letter of credit used for any valid
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business purpose in Borrower's business, shall be denominated in
United States dollars and shall be in NCB's standard form or in other
form satisfactory to NCB.
2E.05 CREDIT REQUESTS AND REIMBURSEMENT AGREEMENTS -- Borrower shall
execute and deliver to NCB-Agent in respect of each Subject LC in
addition to the Credit Request referred to in subsection 2C.02, two
counterparts each of an appropriate application and reimbursement
agreement being in such form and substance as NCB-Agent may require.
Each Credit Request with respect to a Subject LC shall be delivered not
later than 12:00 noon of the third (3rd) Banking Day prior to the day
it is to be issued. To the extent the terms or provisions of any
Reimbursement Agreement are inconsistent with those of this Agreement,
the terms and provisions of this Agreement shall govern.
2E.06 COMMISSION -- Borrower agrees to pay NCB all of its standard fees
and charges, at prevailing rates from time to time established by NCB's
International Department, in regard to any Subject LC, including but not
limited to an issuance fee, an annual maintenance fee, an amendment fee
and a negotiation fee. In addition, Borrower shall pay NCB-Agent, for
the Ratable benefit of the Banks, a non-refundable commission (billed
quarterly in advance) equal to the then applicable Margin under
subsection 2C.05 multiplied by the face amount of each Subject LC. NCB
shall be entitled to keep each of the aforesaid standard fees, if any,
payable by Borrower in respect of the Subject LC as well as keeping its
Ratable share of the commissions.
2E.07 PAYMENT OF DRAFTS -- Whenever a draft drawn under an Subject LC is
presented to NCB for payment, NCB shall give prompt notice thereof to
Borrower and the Banks. In each such case the Banks shall, on the date
the draft is to be paid, grant Borrower a Revolving Series comprised
of PR Loans to fully fund the payment of the draft. Each such Revolving
Series comprised 6f PR Loans shall be made
(a) in accordance with the other provisions of section 2E
(except that the PR Loans shall be made on NCB's demand even
if the Revolving Commitments may no longer be in effect and
even if any one or more Defaults Under This Agreement may then
exist or thereupon occur), and
(b) in such aggregate principal amount as will fully reimburse
NCB for its payment of the draft.
The proceeds shall be disbursed directly to NCB to reimburse NCB as
aforesaid.
2E.08 CHANGE OF LAW -- If any change in any law or regulation or in the
interpretation thereof shall impose, modify, or deem applicable any
reserve, special deposit, or similar requirement which would impose on
NCB-Agent or any bank any additional cost relating to the issuance or
maintenance of letters of credit generally or to the issuance or
maintenance of any specific Subject LC, than NCB-Agent or any Bank may
give to Borrower notice of the amount thereof and a certificate setting
forth a
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computation and explanation thereto and Borrower shall immediately
after receipt thereof pay the amount thereon to NCB-Agent of the Bank,
as the case may be.
2E.09 UNCONDITIONAL OBLIGATIONS -- The obligation of the Banks to
make, and of Borrower to pay, each series of PR Loans made pursuant to
subsection 2E.07 shall be absolute and unconditional and shall be
performed under all circumstances, including, without limitation:
(a) any lack of validity or enforceability of any Subject LC,
(b) the existence of any claim, offset, defense,or other right
that Borrower may have against the beneficiary of any Subject
LC or anyone else,
(c) the existence of any fraud or misrepresentation in the
presentment of any draft drawn and paid under any Subject LC,
or
(d) any payment of any such draft by NCB which does not
strictly comply with the terms of any Subject LC provided such
payment shall not have constituted gross negligence or willful
misconduct.
2E.10 BORROWER'S INDEMNITY -- Borrower agrees to defend and indemnify
NCB against, and to hold NCB harmless from, any loss, liability,
damage, claim, cost, or expense relating to NCB's issuance or
maintenance of any Subject LC or to NCB's payment of any draft drawn
thereunder, excluding any such loss, liability, damage, claim, cost,
or expense resulting from NCB's gross negligence or willful
misconduct.
3A. INFORMATION -- Borrower agrees that so long as the Revolving Commitments
remain in effect and thereafter until the Subject Indebtedness shall have been
paid in full, Borrower will perform and observe each of the following:
3A.01 FINANCIAL STATEMENTS -- Borrower will furnish to each Bank
(a) within forty-five (45) days after the end of each of the
first three quarter- annual periods of each of Borrower's
fiscal years, balance sheets of the Companies as at the end of
the period and their statements of cash flow, income and
surplus, shareholder equity for the current fiscal year to the
end of that period, all prepared (but unaudited) on a
consolidated basis, on a comparative basis with the prior
year, in accordance with GAAP (EXCEPT as disclosed therein)
and in form and detail satisfactory to the Required Banks
(b) as soon as available (and in any event within ninety (90)
days after the end of each of Borrower's fiscal years), a
complete copy of an annual audit report (including, without
limitation, all financial statements of the Companies therein
and notes thereto) of the Companies for that year which shall
be
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(1) prepared on a consolidated and consolidating basis, on a
comparative basis with the prior year with respect to the
consolidated (but not consolidating) statements, in accordance
with GAAP (EXCEPT as disclosed therein) and in form and detail
satisfactory to the Required Banks
(2) certified (without qualification as to GAAP) by
independent public accountants selected by Borrower and
satisfactory to the Required Banks. and
(3) accompanied by a copy of any management report, letter or
similar writing furnished to Borrower by the accountants in
respect of Borrower's systems, operations, financial condition
or properties,
(c) concurrently with the delivery of any financial statement to Banks
pursuant to clause (a) or (b), a certificate by Borrower's chief
financial officer
(1) certifying that to the best of the officer's knowledge and
belief, (A) those financial statements fairly present in all
material respects the financial condition and the results of
operations of the Companies in accordance with GAAP subject,
in the case of interim financial statements, to routine
year-end audit adjustments and (B) no Default Under This
Agreement then exists or if any does, a brief description of
the default and Borrowers intentions in respect thereof, and
(2) setting forth calculations indicating whether or not the
Companies are in compliance with the general financial
standards of section 3B as well as the calculation of the
Companies consolidated Adjusted Funded Indebtedness/EBITDA
Ratio,
(d) promptly when filed (in final form) or sent, a copy of
(1) each registration statement, Form 10-K annual report, Form
10-Q quarterly report, Form 8-K current report or similar
document filed by Borrower with the Securities and Exchange
Commission (or any similar federal agency having regulatory
jurisdiction over Borrower securities).
(2) each proxy statement, annual report, certificate, notice
or other document sent by Borrower to the holders of any of
its securities in their capacities as shareholders (or any
trustee under any indenture which secure, any of its
securities or pursuant to which such securities are issued),
and
(e) as soon as available (and, in any event, no later than sixty (60)
days after the end of each calendar year), forecasts prepared by
management of Borrower, in form and substance satisfactory to the
Required Banks, of consolidated and consolidating balance sheets,
consolidated and consolidating income statements and
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consolidated and consolidating cash flow statements for the Companies
on a quarterly basis for the next succeeding fiscal year.
(f) not less than ten (10) days nor more than forty-five (45) days
prior to (1) an acquisition by Borrower of substantially all the
assets or equity interests of another corporation or business
enterprise, (2) a merger or consolidation by any Company with any
other Person (other than a merger or consolidation referred to in
clause (i) of subsection 3D.01), (3) a joint venture with another
corporation or business enterprise, or (4) an investment in or advance
or loan to any person or entity made after the date of this Agreement
pursuant to subsection 3D.02(iii) or (iv) below, oral notification to
each Bank regarding such event of the type referred to in clauses (1)
through (4) above and, if any Bank shall request in respect thereto,
twelve (12) month financial projections (the "Projections"), including
a projected balance sheet and cash flow and income statements,
prepared by Borrower's chief financial officer, controller or another
officer reasonably satisfactory to the Required Banks. Notwithstanding
the foregoing, Banks agree that they shall not request Projections in
the event the aggregate dollar amount of such events for a given
fiscal year do not exceed ten percent (10%) of the consolidated
Stockholders Equity of the Companies as of the end of the prior fiscal
year. The Projections shall be prepared on the basis of the historical
operations of the Companies (and any entity to be acquired or merged
or consolidated with) after giving effect to the event in question and
all reasonable related assumptions. The officer preparing such
Projections shall certify to Banks and NCB-Agent that to the best of
his knowledge and belief such financial information is not misleading
and is accurate in all material respects. Borrower shall promptly
notify Banks of any change in the assumptions upon which the
Projections are based between the date of preparation and the date of
the event in question,
(g) forthwith upon Bank's written request, such other information in
writing about the financial condition, properties and operations of
the Companies and about their Pension Plans, if any, as the Required
Banks may from time to time reasonably request.
3A.02 NOTICE -- Borrower will cause its chief financial officer, or in his
absence another officer designated by Borrower, to give each Bank prompt
written notice whenever any officer of any Company
(a) reasonably believes (or receives notice from any governmental
agency alleging) that any Reportable Event has occurred in respect of
any Pension Plan or that a Company has become in material
non-compliance with any law or governmental order referred to in
subsection 3C.06 if non-compliance therewith would materially and
adversely affect the financial condition or operations of the
Companies taken as a whole,
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(b) receives from the Internal Revenue Service or any other federal,
state, local, domestic or foreign taxing authority any allegation of
any default by a Company in the payment of any tax that is material in
amount to the Companies taken as a whole or notice of any assessment
in respect thereof,
(c) learns there has been brought against a Company before any court,
administrative agency or arbitrator any litigation or proceeding
which, if successful, might have a material adverse effect on the
Companies taken as a whole,
(d) reasonably believes that any representation or warranty made in
subsections 4B.01 through 4B.08 (both inclusive) or 4B.10 through
4B.21 (both inclusive) shall have ceased in any material respect to be
true and complete or that any Default Under This Agreement shall have
occurred or
(e) reasonably believes that there has occurred or begun to exist any
other event, condition or thing that likely may have a material
adverse effect on the financial condition operations or properties of
the Companies taken as a whole,
(f) reasonably believes (or receives any notice from any third party)
that a Company has defaulted or otherwise breached any Material
Contract to which such Company is a party.
3B. GENERAL FINANCIAL STANDARDS -- Borrower agrees that so long as the
Revolving Commitments remain in effect and thereafter until the Subject
Indebtedness shall have been paid in full, Borrower will perform and observe
each of the following:
3B.01 FUNDED INDEBTEDNESS/CAPITAL -- Borrower will not suffer or
permit, as at the end of any fiscal quarter, the ratio of (a) the sum
of (i) the consolidated amount of Funded Indebtedness of the Companies
PLUS (ii) the consolidated amount of all other indebtedness for
borrowed money of the Companies to (b) the sum of (i) the consolidated
amount of Funded Indebtedness of the Companies PLUS (ii) the
consolidated amount of all other indebtedness for borrowed money of
the Companies PLUS (iii) consolidated Stockholders' Equity of the
Companies to be greater than (A) for the period commencing on the date
of the execution of this Agreement and concluding on the day
immediately preceding the Refinancing Date, .60 to 1.0., (B) in the
event that Borrower completes a public equity offering for which the
Net Offering Proceeds are equal to or greater than Sixty Million
Dollars ($60,000,000) and for the period commencing on the Refinancing
Date and thereafter, .45 to 1.0, and (C) in the event that Borrower
fails to complete a public equity offering for which the Net Offering
Proceeds are equal to or greater than Sixty Million Dollars
($60,000,000) and (1) for the period commencing on the Refinancing
Date and concluding on December 31, 1998, .60 to 1.0, and (2) for the
period commencing on January 1, 1999 and continuing thereafter, .50 to
1.0.
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3B.02 CURRENT RATIO -- Borrower will not suffer or permit, as at the
end of any fiscal quarter, the consolidated Current Assets of the
Companies to fall below an amount equal to one hundred fifty percent
(150%) of their consolidated Current Liabilities.
3B.03 FUNDED INDEBTEDNESS/EBITDA -- Borrower will not suffer or
permit, as at the end of any fiscal quarter, the consolidated Funded
Indebtedness/EBITDA Ratio of the Companies to be greater than (A) for
the period commencing on the date of the execution of this Agreement
and concluding on the day immediately preceding the Refinancing Date,
3.25 to 1.0., (B) in the event that Borrower completes a public equity
offering for which the Net Offering Proceeds are equal to or greater
than Sixty Million Dollars ($60,000,000) and for the period commencing
on the Refinancing Date and thereafter, 2.5 to 1.0, and (C) in the
event that Borrower fails to complete a public equity offering for
which the Net Offering Proceeds are equal to or greater than Sixty
Million Dollars ($60,000,000) and (1) for the period commencing on the
Refinancing Date and concluding on December 31, 1997, 3.25 to 1.0, (2)
for the period commencing on January 1, 1998 and concluding on
December 31, 1998, 3.0 to 1.0, and (3) for the period commencing on
January 1, 1999 and continuing thereafter, 2.5 to 1.0.
3C. AFFIRMATIVE COVENANTS -- Borrower agrees that so long as the Revolving
Commitments remain in effect and thereafter until the Subject Indebtedness
shall have been paid in full, the Companies will perform and observe each of
the following:
3C.01 TAXES -- Each Company will pay in full
(a) prior in each case to the date when penalties for the
nonpayment thereof would attach, all taxes, assessments and
governmental charges and levies for which it may be or become
subject and
(b) prior in each case to the date the claim would become
delinquent for nonpayment, all other lawful claims (whatever
their kind or nature) which, if unpaid, might have a material
adverse effect upon the Companies on a consolidated basis;
PROVIDED, that no item (other than wage or social security withholding
tax obligations) need be paid so long as and to the extent that it is
contested in good faith and by timely and appropriate proceedings
which are effective to stay enforcement thereof and Borrower either
posts a bond or otherwise establishes adequate reserves therefor.
3C.02 FINANCIAL RECORDS -- Each Company will at all times keep true
and complete financial records in accordance with GAAP and, without
limiting the generality of the foregoing, make appropriate accruals to
reserves for estimated and contingent losses and liabilities.
3C.03 VISITATION -- Each Company will permit each Bank at all
reasonable times upon reasonable advance notice except in the case of
an emergency
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(a) to visit and inspect that Company's properties and examine
its records at that Bank's expense and to make copies of and
extracts from such records, and
(b) to consult with that Company's directors, officers,
employees, accountants, actuaries, trustees and plan
administrators in respect of its financial condition,
properties and operations and the financial condition of its
Pension Plans, each of which parties is hereby authorized to
make such information available to each Bank to the same
extent that it would to that Company; provided, however, that
so long as no Default Under This Agreement shall have occurred
and be continuing, each of the Banks agrees to use its
reasonable efforts to coordinate any such visits or
consultations with the other Banks, to the extent reasonably
practicable; provided, further, that all information obtained
shall be subject to the provisions Section 8.20.
3C.04 INSURANCE -- Each Company will
(a) keep itself and all of its insurable properties insured
(or self-insured in accordance with prudent insurance
practice) at all times to such extent, with such deductibles,
by such insurers and against such hazards and liabilities as
is generally and prudently done by like businesses, and
(b) forthwith upon any Bank's written request furnish to that
Bank such information about Borrower's insurance as that Bank
may from time to time reasonably request, which information
shall be prepared in form and detail reasonably satisfactory
to that Bank and certified by an officer of Borrower.
3C.05 CORPORATE EXISTENCE -- Each Company will at all times maintain
its corporate existence, rights and franchises, the failure to
maintain any of which would have a material adverse effect on such
Company; provided that this subsection shall not prevent any
dissolution and liquidation of any Subsidiary or any merger or
consolidation permitted by subsection 3D.0l.
3C.06 COMPLIANCE WITH LAW -- Each Company will comply with all laws
(whether federal, state or local and whether statutory, administrative
or judicial or other) and with every lawful governmental order
(whether administrative or judicial) and will, without limiting the
generality of the foregoing,
(a) use and operate all of its facilities and properties in
material compliance with all Environmental Laws and handle all
hazardous materials in material compliance therewith; keep in
full effect each permit, approval, certification, license or
other authorization required by any Environmental Law for the
conduct of any material portion of its business; and comply in
all other material respects with all Environmental Laws
(including the undertaking of any cleanup, remedial or other
action necessary in order to comply with any directive of a
governmental authority or Environmental Law);
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(b) make a full and timely payment of premiums required by
ERISA and perform and observe all such further and other
requirements of ERISA such that no Default Under ERISA shall
occur or begin to exist; and
(c) comply with all material requirements of all occupational
health and safety laws and federal and state securities laws;
PROVIDED, that this subsection shall not apply to any of the foregoing
(i) if and to the extent that the same shall be contested in
good faith by timely and appropriate proceedings which are
effective to stay enforcement thereof and against which a bond
has been posted or appropriate reserves shall have been
established or
(ii) in any other case if non-compliance therewith would not
materially and adversely affect the Companies' consolidated
financial condition, properties or business.
3C.07 PROPERTIES -- Each Company will maintain all fixed assets
necessary to its continuing operations in good working order and
condition, ordinary wear and tear excepted, refrain from wasting or
destroying any such necessary fixed assets and refrain from being
negligent in the care or use thereof.
3C.08 QUALIFICATION TO DO BUSINESS -- Each Company shall remain
qualified to do business in each jurisdiction in which such
qualification is required by law and in which the consequences of a
failure to qualify would have a materially adverse effect on the
business or financial condition of the Companies on a consolidated
basis.
3C.09 APPLICATION OF NET OFFERING PROCEEDS -- Borrower shall apply,
immediately upon its receipt thereof, the Net Offering Proceeds of up
to Sixty Million Dollars ($60,000,000) to pay down the aggregate
outstanding principal amount of the Term Loans. In the event that
Borrower raises more than Sixty Million Dollars ($60,000,000) in Net
Offering Proceeds, Borrower may apply, after the Refinancing Date, all
or a portion of such proceeds in excess of Sixty Million Dollars
($60,000,000) to pay down the aggregate outstanding principal amount
of the Revolving Loans.
3D. NEGATIVE COVENANTS -- Borrower agrees that so long as the Revolving
Commitments remain in effect and thereafter until the Subject Indebtedness
shall have been paid in full, the Companies will perform and observe each of
the following:
3D.01 EQUITY AND ASSET TRANSACTIONS -- No Company will
(a) be a party to any merger or consolidation,
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(b) create, acquire or hold any Subsidiary, or purchase or
otherwise acquire all or substantially all of the assets and
business of any corporation or other business enterprise, or
be or become a party to any joint venture or partnership,
(c) make or keep any investment in any stocks or other equity
securities of any kind, except that this clause (c) shall not
apply to any existing (as of the date hereof) investments in
stocks and other equity securities of Subsidiaries or any
other investment fully disclosed in the Companies' December
31, 1995 consolidated audited financial statements or in the
Supplemental Schedule,
(d) lease as lessor, sell, sell-leaseback or otherwise
transfer (whether in one transaction or a series of
transactions) all or any substantial part of its fixed assets,
including, without limitation, all or substantially all of the
assets of a division, branch or other unit operation, EXCEPT
chattels that shall have become obsolete or no longer useful
in its present business, or
(e) sell or otherwise transfer or issue (in the case of a
Subsidiary) any shares of stock (other than shares issued or
transferred solely for the purpose of qualifying directors
under any applicable law) or other equity securities of any
Subsidiary to anyone other than Borrower;
provided, that if no Default Under this Agreement shall then exist and
if none would thereupon begin to exist, this subsection shall not
apply to
(i) any merger or consolidation involving only Subsidiaries of
the Borrower, or any merger involving only the Borrower and
one or more of its Subsidiaries in which the Borrower is the
surviving corporation, or
(ii) any acquisition by a Company of substantially all of the
assets or equity interest of another corporation or business
enterprise, any merger or consolidation by any Company with
any other Person (other than a merger or consolidation
referred to in clause (i) above), or any joint venture with
another corporation or business enterprise; provided that (A)
the target or resulting entity is in the same, substantially
similar or a complementary line of business, and (B) Proforma
Covenant Compliance pertains and, to the extent Projections
are requested, the Required Banks do not reasonably object to
the assumptions or other information upon which the relevant
Projections were based (each of the Banks hereto, by their
signatures hereof, do hereby consent to the assumptions upon
which the Projections delivered in connection with the
Acquisition were based), or
(iii) any sale, lease or transfer of assets by any Company
(other than any sale or transfer of any of the capital stock
by the Borrower of any of its Subsidiaries) otherwise
prohibited by this Subsection 3D.01 so long as (A) such sale,
lease or transfer is for not less than the fair market value
of such assets, (B) the consideration received therefor is
cash or cash equivalents and (C) the aggregate
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of such proceeds of all such sales shall not exceed Five
Million Dollars ($5,000,000) during the term of this
Agreement.
3D.02 CREDIT EXTENSIONS -- No Company will
(a) make or keep any investment in any notes, bonds or other
obligations of any kind for the payment of money or make or
have outstanding at any time any advance or loan to anyone or
(b) be or become a Guarantor of any kind;
PROVIDED, that this subsection shall not apply to
(i) any existing or future advance, commission or relocation
payment, or other loan or advance made to an employee or to a
director or officer of the Company in the ordinary course of
business and consistent with past practice,
(ii) any existing or future investment in any such notes,
bonds or other obligations consisting of (A) Acceptable
Marketable Securities or (B) in the case of Kokkola Chemicals
Oy, the Borrower's wholly-owned Finnish subsidiary, (x) any
money-market investment carrying the highest quality rating
issued by Standard and Poors or any Scandinavian affiliate
thereof and (y) certificates of deposit or commercial paper
(with a remaining term of 360 days or less) issued by any bank
having a combined capital and surplus aggregating at least
Three Hundred Fifty Million Dollars ($350,000,000); PROVIDED,
HOWEVER, that the aggregate amount of the investments in
clause (A) and (B) hereof outstanding at any time shall not
exceed Fifteen Million Dollars ($15,000,000),
(iii) any existing investment, advance, loan or Guaranty fully
disclosed in the Companies' December 31, 1995 consolidated
audited financial statements or in the Supplemental Schedule
or any other investment, advance or loan provided that (A) the
entity invested in or to which an advance or loan is made is
in the same, substantially similar or a complementary line of
business and (B) Proforma Covenant Compliance pertains and, to
the extent Projections are requested, the Required Banks to
not reasonably object to the assumptions or other information
upon which the relevant Projections were based,
(iv) any intercompany loan or Guaranty by the Borrower (not
otherwise permitted by clause (iii) above) to, and any
Guaranty by the Borrower of any indebtedness of, any
Subsidiary of the Borrower in which the Borrower owns one
hundred percent (100%) of the outstanding common stock (except
for shares owned by directors as required by law); PROVIDED,
HOWEVER, that, at the time of and after giving effect to any
such loan or Guaranty (A) no Default Under This Agreement
shall have occurred and be continuing and (B) Proforma
Covenant Compliance pertains and, to the extent Projections
are requested, the Required
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Banks do not reasonably object to the assumptions or other
information upon which the relevant Projections were based,
(v) any endorsement of a check or other medium of payment for
deposit or collection, or any similar transaction in the normal
course of business, or
(vi) trade accounts arising and outstanding in the ordinary
course of business unless represented by a promissory note or
other instrument.
3D.03 BORROWINGS -- No Company will create, assume or have outstanding
at any time any indebtedness for borrowed money or any Funded
Indebtedness of any kind to the extent the same would cause a
violation of the general financial standards contained in Section 3B
or otherwise violate any other term or provision of this Agreement or
any Related Writing and no indebtedness for borrowed money or Funded
Indebtedness of any Company will have covenants or defaults materially
more restrictive on the Companies than those set forth in this
Agreement.
3D.04 LIENS, LEASES -- No Company will
(a) lease any property as lessee or acquire or hold any property
subject to any land contract, inventory consignment or other
title retention contract,
(b) sell or otherwise transfer any receivables with recourse or
(c) suffer or permit any property now owned or hereafter
acquired by it to be or become encumbered by any mortgage,
security interest, lien or financing statement:
PROVIDED, that this subsection shall not apply to
(i) any tax lien for taxes not yet due and payable, or any lien
securing workers' compensation or unemployment insurance
obligations, or any mechanic's, carrier's or landlord's lien, or
any lien arising under ERISA, or any security interest arising
under article four (bank deposits and collections) or five
(letters of credit) of the Uniform Commercial Code, or any
similar security interest or other lien. EXCEPT that this clause
(i) shall apply only to security interests and other liens
arising by operation of law (whether statutory or common law)
and in the ordinary course of business and shall not apply to
any security interest or other lien that secures any
indebtedness for borrowed money or any Guaranty thereof or any
obligation that is in material default in any manner (other than
any default contested in good faith by timely and appropriate
proceedings effective to stay enforcement of the security
interest or other lien in question and against which a bond has
been posted or appropriate reserves shall have been
established),
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(ii) zoning or deed restrictions, public utility easements,
minor title irregularities and similar matters in each case
having no material adverse effect as a practical matter on the
ownership or use of any of the property in question,
(iii) any lien securing or given in lieu of surety, stay, appeal
or performance bonds, or securing performance of contracts or
bids (other than contracts for the payment of money borrowed),
or deposits required by law or governmental regulations or by
any court order, decree, judgment or rule or as a condition to
the transaction of business or the exercise of any right,
privilege or license, EXCEPT that this clause (iii) shall not
apply to any lien or deposit securing an obligation that is in
material default in any manner (other than any default contested
in good faith by timely and appropriate proceedings effective to
stay enforcement of the security interest or other lien in
question and against which a bond has been posted or appropriate
reserves shall have been established),
(iv) any mortgage, security interest or other lien securing only
the Subject Indebtedness which may hereafter be granted by a
Company by agreement of the parties hereto,
(v) any mortgage, security interest or other lien (each, a
"purchase money security interest") which is created or assumed
in purchasing, leasing (pursuant to a capitalized lease),
constructing or improving any real property or equipment or to
which any such property is subject when purchased, PROVIDED,
that (A) the purchase money security interest shall be confined
to the aforesaid property, (B) the indebtedness secured thereby
does not exceed the total cost of the purchase construction or
improvement, (C) any such indebtedness, if repaid in whole or in
part, cannot be reborrowed and (D) the aggregate amount of all
such purchase money security interest does not exceed Five
Million Dollars ($5,000,000) in any fiscal year,
(vi) any lease other than any capitalized lease (it being agreed
that a capitalized lease is a lien rather than a lease for the
purposes of this Agreement),
(vii) any mortgage, security interest or other lien which
(together with the indebtedness secured thereby) is fully
disclosed in the Companies' December 31, 1995 consolidated
audited financial statements or in the Supplemental Schedule,
(viii) any mortgage, security interest or other lien permitted
by this Section 3D.04 securing any indebtedness permitted by
this Agreement that is a renewal, extension or refinancing of
such indebtedness; PROVIDED, HOWEVER, that (i) such extended,
renewed or replacement mortgage, security interest or other lien
shall be limited to all or a part of the same property that
secured the lien extended, renewed or replaced and (ii) the
indebtedness secured thereby shall not be increased; or
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(ix) any financing statement perfecting a security interest that
would be permissible under this subsection.
3D.05 DIVIDENDS -- No Company shall make or commit itself to make any
Distribution to its shareholders at any time; PROVIDED, HOWEVER, that, so long
as no Default Under This Agreement shall then exist or would thereupon occur,
the Borrower may, during any fiscal year, make Distributions consisting of
dividends payable solely in cash in an aggregate amount not to exceed the
greater of (a) Ten Million Dollars ($10,000,000) or (b) twenty-five percent
(25%) of the consolidated Net Income of the Companies for such fiscal year.
3D.06 CHANGE IN NATURE OF BUSINESS -- No Company shall make any material
change in the nature of its business as carried on at the date hereof.
3D.07 ACCOUNTING CHANGES -- No Company shall make or permit any change in
accounting policies or reporting practices, except as required by law or as
required or permitted by GAAP applicable to such Company from time to time.
3D.08 AMENDMENT; DEFAULT OF MATERIAL CONTRACTS -- Other than in the exercise
of reasonable business judgment, no Company shall cancel or terminate any
Material Contract or consent to or accept any cancellation or termination
thereof. No Company shall (i) amend or otherwise modify in any material
respect any Material Contract or give any consent, waiver or approval
thereunder; (ii) permit any material default by such Company to exist beyond
any applicable cure period; (iii) waive any material default under or breach
of any Material Contract; or (iv) agree in any manner to any other material
amendment, modification or change of any term or condition of any Material
Contract or take any other action in connection with any Material Contract
that might reasonably be expected to have a material adverse effect on the
business or financial condition of the Companies on a consolidated basis or
that would materially impair the interest or rights of NCB-Agent or any Bank.
3D.09 USE OF PROCEEDS -- The Borrower shall not use the proceeds of any Subject
Loan for any purpose other than the refinancing of the existing indebtedness to
certain of the Banks, providing funds for acquisitions, joint ventures, capital
expenditures and general corporate purposes consistent with and subject to the
terms and provisions hereof.
3D.10 ADVERSE OBLIGATIONS; LABOR DISPUTES -- No Company shall be subject to any
contract, agreement, corporate restriction, judgment, decree or order
materially and adversely affecting the business, property, assets, operations
or condition, financial or otherwise, of the Companies on a consolidated basis.
No Company shall be a party to any labor dispute other than grievance disputes
which do not materially and adversely affect the business, property, assets,
operations or condition, financial or otherwise, of the Companies on a
consolidated basis. No Company shall be subject to any material strikes, slow
downs, walkouts or other concerted interruptions of operations by employees
whether or not relating to any labor contracts other than strikes, slow downs,
walkouts or other
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concerted interruptions which do not materially and adversely affect the
business, property, assets, operations or condition, financial or
otherwise, of the Companies on a consolidated basis.
4A. CLOSING -- Prior to or at the execution and delivery of this Agreement
Borrower shall have complied or caused compliance with each of the following:
4A.01 NOTES -- Borrower shall execute and deliver to each Bank a Term Note
and an Initial Revolving Note in accordance with subsection 2A.01 and
2C.01. Upon Borrower's execution and delivery of the Initial Revolving
Notes and the Term Notes to the Banks, each of the Banks agree to return
to Borrower the revolving notes issued by Borrower in connection with the
Prior Credit Agreement and the same shall be either marked "cancelled" or
"substituted".
4A.02 RESOLUTIONS/INCUMBENCY -- Borrower's secretary or assistant secretary
shall have certified to Banks (a) a copy of resolutions duly adopted by its
board of directors in respect of this Agreement and the transactions
contemplated hereby and the Acquisition Agreement and the transactions
contemplated thereby, and (b) the names and true signatures of officers
authorized to execute and deliver this Agreement, the Acquisition
Agreement, the Acquisition Documents and Related Writings on behalf of
Borrower and the secretary or assistant secretary of each of the current
Guarantors shall have delivered a similar certification to Banks in regard
to authorization of its respective guaranty.
4A.03 LEGAL OPINION -- Borrower's, Seller's and each of the Current
Guarantors' counsel shall have rendered to Banks their written opinion in
respect of the matters referred to in subsections 4B.01, 4B.02, 4B.03,
4B.04 and 4B.23 as they relate to Borrower, Seller and each of the Current
Guarantors, and also as to the obtaining of all necessary consents so that
this Agreement will not breach the Acquisition Agreement, any of the
Acquisition Documents, or the Note Purchase Agreement, which opinion shall
be in such form and substance (and may be subject only to such
qualifications and exceptions, if any) as shall be satisfactory to the
Required Banks and substantially similar to the acceptable form of legal
opinion previously provided by NCB-Agent to Borrower and its counsel.
4A.04 CONSUMMATION OF ACQUISITION -- Borrower shall have furnished to Banks
evidence, in form and substance satisfactory to Banks, that all
transactions contemplated by the Acquisition Agreement to occur on or
before the closing date set forth therein, including, without limitation,
the Acquisition, have been consummated.
4A.05 ACQUISITION DOCUMENTS -- Borrower shall have furnished to Banks true
and correct copies, certified to Banks by an officer of Borrower, of the
executed Acquisition Agreement and each of the Acquisition Documents, each
of which shall be in form and substance satisfactory to Banks.
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4A.06 FINANCIAL STATEMENTS -- Borrower shall have furnished to Banks at
least one (1) true and complete copy of each of the following: the
annual audit report (including, without limitation, all financial
statements therein and notes thereto and the accompanying accountants'
opinion and management report) of the Companies prepared as at December
31, 1995 and annual audit reports for each of the two (2) next
preceding fiscal years (each having been certified by Ernst & Young)
and unaudited interim financial statements prepared as at September 30,
1996.
4A.07 DOCUMENTATION FEE -- Borrower shall have paid NCB-Agent, for its
own account, a documentation fee in an amount agreed upon by and
between Borrower and NCB-Agent.
4A.08 CLOSING FEE -- Borrower shall have paid NCB-Agent, for the
account of the Banks, the closing fee payable pursuant to Section
2A.05 hereof.
4A.09 OTHER DOCUMENTS -- Borrower shall execute or deliver to NCB-Agent
such other agreements, instruments and documents, including, without
limitation, those listed below, which NCB-Agent may require to be
executed and/or delivered in connection herewith (all of which shall be
in form and substance acceptable to NCB-Agent and its counsel):
(a) Evidence that the Companies possess insurance satisfying the
requirements of Section 3C.04 hereof. Insurance certificates
respecting the same shall be delivered to NCB-Agent on behalf of
the Banks and shall name NCB-Agent as lender loss payee. In
addition, the certificates shall contain a statement that NCB-
Agent will be provided with thirty (30) days written notice prior
to any cancellation, termination or expiration of such insurance
coverage and such statement may not provide that the issuing
company will merely "endeavor to" provide such notice nor may such
statement contain limitation of liability language for the issuing
company or its representatives in the event of their failure to
provide such notice;
(b) Certificates of good standing for each of Borrower, Seller
and each of the Current Guarantors;
(c) Certificate of incorporation of each of Borrower, Seller and
each of the Current Guarantors, certified by the respective
secretary of state or similar government official of the state or
other similar governmental body in which each such Person is
incorporated;
(d) A disbursement authorization, in form and substance
acceptable to NCB-Agent, directing the disbursement of the
proceeds of the Subject Loans; and
(e) Guaranties by the respective Current Guarantors, of
Borrower's Debt to Banks and NCB Agent.
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4B. REPRESENTATIONS/WARRANTIES -- Subject only to such additions and
exceptions, if any, as may be set forth in the Supplemental Schedule or in
Borrower's Most Recent 4A.04 Financial Statements, Borrower represents and
warrants as follows:
4B.01 EXISTENCE -- The Borrower and each of its Subsidiaries is duly
organized, validly existing and in good standing under the laws of the
state of its incorporation. EXHIBIT G sets forth the name and address of
each of the Borrower's Subsidiaries existing as of the closing date, the
chief executive office of each Subsidiary and the jurisdiction in which
each such Subsidiary is incorporated. All of the outstanding stock of each
such Subsidiary is owned by the Borrower and is fully paid and
non-assessable and owned by Borrower free from any security interest,
option, equity or other right of any kind. The Borrower and each of its
Subsidiaries is duly qualified to transact business in each state or other
jurisdiction in which it owns or leases any real property or in which the
nature of the business conducted makes such qualification necessary or, if
not so qualified, such failure to qualify will have no material adverse
effect upon the condition (financial or otherwise) of the Companies on a
consolidated basis and their ability to transact business.
4B.02 GOVERNMENTAL RESTRICTIONS -- No registration with or approval of any
governmental agency of any kind is required on the part of any Company or
Seller which has not been made and/or obtained, as the case may be, for
the due execution and delivery or for the enforceability of this
Agreement, the Acquisition Agreement, any Acquisition Document or any
Related Writing.
4B.03 POWER, AUTHORIZATION AND CONSENT; ENFORCEABILITY -- The execution,
delivery and performance by the Borrower of this Agreement, the
Acquisition Agreement, the Acquisition Documents and the Related Writings
to which it is party (a) are within the Borrower's legal power and
authority, (b) have been duly authorized by all necessary or proper action
of such the Borrower, (c) will not violate (i) any provision of law
applicable to the Borrower, (ii) any provision of the Borrower's or any
other Company's, as the case may be, certificate or articles of
incorporation or by-laws or regulations, or (iii) any material agreement
or material indenture by which any Company or the property of any Company
is bound, except where such violation specified in this clause (iii) would
not have a materially adverse effect on the Companies taken as a whole, or
(d) will not result in the creation or imposition of any lien or
encumbrance on any property or assets of the Companies. This Agreement
constitutes, the Acquisition Agreement constitutes, the Acquisition
Documents and the Related Writings when duly executed will constitute, the
legal, valid and binding obligations of Borrower, enforceable against
Borrower in accordance with its respective terms subject to any applicable
insolvency or bankruptcy law of general applicability and general
principles of equity. The guaranties of the respective Current Guarantors
each constitutes the legal, valid and binding obligation of such Current
Guarantor, enforceable against it in accordance with its terms subject to
any applicable insolvency or bankruptcy law of general applicability and
general principles of equity. The Acquisition Agreement constitutes the
legal, valid and binding obligation of the Seller, enforceable against it
in accordance with its terms
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subject to any applicable insolvency or bankruptcy law of general
applicability and general principles of equity.
4B.04 LITIGATION; PROCEEDINGS -- No action, suit, investigation or
proceeding is now pending or, to the knowledge of Borrower, threatened
against the Borrower or any of its Subsidiaries at law, in equity or
otherwise, or with respect to this Agreement, the Acquisition Agreement,
any Acquisition Document or any Related Writing, before any court, board,
commission, agency or instrumentality of any federal, state, local or
foreign government or of any agency or subdivision thereof, or before any
arbitrator or panel of arbitrators which might reasonably be expected to
have a material adverse effect on the condition (financial or otherwise)
of the Companies on a consolidated basis.
4B.05 TAXES -- Each Company has filed all federal, state, local, foreign
and domestic tax returns which are required to be filed by it and paid all
taxes due as shown thereon, including interest and penalties (except to
the extent, if any, permitted by Section 3C.01).
4B.06 TITLE -- Each Company has good and marketable title to all of its
assets reflected in the Companies' Most Recent 4A.04 Financial Statements
except for changes resulting from transactions in the ordinary course of
business. All such assets are free of all mortgages, security interests or
other liens other than those otherwise permitted by Section 3D.04.
4B.07 LAWFUL OPERATIONS -- Except as set forth in the Supplemental
Schedule, the operations of each Company are in full compliance with all
material requirements imposed by law or regulation, whether federal, state
or local including (without limitation) all environmental protection laws,
occupational safety and health laws and zoning ordinances.
4B.08 INSURANCE -- The insurance coverage of the Companies complies with
the standards set forth in subsection 3C.04.
4B.09 FINANCIAL STATEMENTS -- The Borrower's annual report (including,
without limitation, all financial statements therein and the notes thereto
and the accompanying accountants' certificate and management report),
prepared as at December 31, 1995 and certified by Ernst & Young, and the
Borrower's unaudited interim financial statements prepared as at September
30, 1996, each of which has been heretofore furnished by the Borrower to
each Bank (i) have been prepared in accordance with GAAP applied on a
consistent basis with those used by it during its fiscal year ended
December 31, 1995 except to the extent, if any, specifically noted therein
and (ii) fairly present in all material respects (subject to routine
year-end audit adjustments in the case of the unaudited financial
statements) the consolidating and consolidated financial condition of the
Borrower and its Subsidiaries as of the respective dates thereof
(including a full disclosure of material liabilities, if any) and the
consolidating and consolidated results of their operations, if any, for
the respective fiscal periods then ending. As of the closing date, there
has been no material adverse change in the financial condition, properties
or business of the Borrower or any of its Subsidiaries since the December
31, 1995 financial
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statements nor any changes in the Borrower's accounting procedures since
the end of the Borrower's 1995 latest full fiscal year. The Acquisition
Projections are based upon reasonable assumptions, are not misleading,
and, to the best of Borrower's knowledge, are accurate in all material
respects.
4B.10 INDEBTEDNESS -- Except for the line of Credit of Target with
NationsBank in the amount of One Million Seven Hundred Thousand Dollars
($1,700,000), no Company has outstanding any material indebtedness for
borrowed money or any Funded Indebtedness of any kind except any which is
not prohibited by subsection 3D.03.
4B.11 ERISA -- No material Accumulated Funding Deficiency exists in
respect of any Pension Plan of any Companies or any of their ERISA
Affiliates. No Reportable Event has occurred in respect of any Pension
Plan which is continuing and which (i) constitutes grounds either for
termination of the plan or for court appointment of a trustee for the
administration thereof or (ii) is reasonably likely to have a material
adverse effect on the Companies on a consolidated basis. No "prohibited
transaction" (as defined in section 406 of ERISA or Section 4975 of the
Internal Revenue Code of 1986, as amended), has occurred that has resulted
in or is reasonably likely to result in any liability which has a material
adverse effect on the Companies on a consolidated basis. None of the
Companies or any of their ERISA Affiliates has (i) had an obligation to
contribute to any Multiemployer Plan, as defined in Section 4001(a)(3) of
ERISA, since 1987 or (ii) incurred or reasonably expects to incur any
liability for the withdrawal from such a Multiemployer Plan which
liability would have a material adverse effect on the Companies on a
consolidated basis.
4B.12 ADVERSE OBLIGATIONS; LABOR DISPUTES -- No Company is subject to any
contract, agreement, corporate restriction, judgment, decree or order
materially and adversely affecting its business, property, assets,
operations or condition, financial or otherwise, is a party to any labor
dispute (other than grievance disputes which do not in the aggregate
materially and adversely affect any of their respective operations,
financial condition, or business), and, there are no material strikes,
slow downs, walkouts or other concerted interruptions of operations by
employees whether or not relating to any labor contracts.
4B.13 SOLVENCY -- After giving effect to the transactions contemplated by
this Agreement, the Acquisition Agreement, the Acquisition Documents and
the Related Writings, the following shall be true as to each Company: (i)
the fair saleable value of such party's assets is greater than the amount
required to pay its total liabilities, (ii) such party is able to pay its
debts as they mature and is not otherwise insolvent in any respect and
(iii) such party's capital is sufficient and not unreasonably small for
the business and transactions in which such party is engaged or about to
engage.
4B.14 INVESTMENT COMPANY ACT STATUS -- No Company is an "investment
company" or an "affiliate person" of, or "promoter" or "principal
underwriter" for, an
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"investment company", as such terms are defined in the Investment Company
Act of 1940, as amended (15 U.S.C. Section 80(a)(1), ET SEQ.).
4B.15 REGULATION U/REGULATION X COMPLIANCE -- The Borrower does not own
any "margin stock", as that term is defined in Regulation U of the Board
of Governors of the Federal Reserve System, and the proceeds of the
borrowings made pursuant to this Agreement will be used only for the
purposes contemplated hereunder.
4B.16 ENVIRONMENTAL AND SAFETY MATTERS -- Except for copper emissions from
the Target's plant in Durham, North Carolina (which emissions do not
violate applicable Environmental Laws), hazardous materials have not been
released or disposed of on any property owned or leased by a Company or,
to the best knowledge of the Borrower, any property adjoining any such
properties. All environmental permits have been obtained and are in effect
for the operations conducted at all property owned or leased by a Company.
The Companies are in material compliance with all applicable Environmental
Laws and all environmental permits. The Companies have disposed of all
wastes generated, including wastes containing hazardous materials, in
material compliance with all applicable Environmental Laws and
environmental permits. There are no past, pending or, to the actual
knowledge of the Borrower, threatened environmental claims against the
Companies that individually or in the aggregate could have a material
adverse effect on the Companies on a consolidated basis. No property owned
or leased by a Company or, to the best knowledge of the Borrower, any
property adjoining any such property, is listed or proposed for listing on
the National Priorities List under CERCLA or on any other list maintained
by any governmental authority of sites requiring environmental
investigation or cleanup. No Company has transported or arranged for the
transportation of any hazardous materials to any location that is listed
or proposed for listing on the National Priorities List under CERCLA or on
any other analogous list or, to the best knowledge of the Borrower, to any
location that is the subject of any environmental claim. To the best
knowledge of the Borrower, there are no circumstances with respect to any
property owned or leased by a Company or the operations of any Company
that could reasonably be anticipated (i) to form the basis of an
environmental claim against such Company or any property owned or leased
by a Company that individually or in the aggregate might materially and
adversely effect the Companies on a consolidated basis or (ii) to cause
any property owned or leased by a Company to be subject to any
restrictions on ownership, occupancy, use or transferability under any
applicable Environmental Law.
4B.17 REAL PROPERTY -- Each Company has good, marketable and insurable fee
simple title to the real property owned by it, free and clear of all
mortgages, liens or encumbrances, other than liens permitted hereunder.
4B.18 LEASES -- Each lease of real property under which any Company is the
lessee is the legal, valid and binding obligation of the lessor thereof,
enforceable in accordance with its terms (subject to limitations imposed
by general principles of equity (regardless whether such enforceability is
considered in a proceeding at law or in equity) and the
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effect of applicable bankruptcy, reorganization, insolvency, moratorium
and similar laws of general application relating to or affecting
creditors' rights).
4B.19 INTELLECTUAL PROPERTY -- Each Company owns or possess all the
patents, trademarks, service marks, copyrights, licenses and rights with
respect to the foregoing necessary for the conduct of its business without
any known conflict with the rights of others.
4B.20 DEFAULTS -- No Default Under This Agreement exists, nor will any
exist immediately after the execution and delivery of this Agreement.
4B.21 NOTEHOLDERS AND NOTE PURCHASE AGREEMENT -- The Noteholders are the
only holders of notes pursuant to the Note Purchase Agreement. The
execution of this Agreement and the consummation of the transactions
contemplated hereby do not conflict with the terms of the Note Purchase
Agreement or cause any default thereunder and all necessary consents have
been obtained.
4B.22 FULL DISCLOSURE -- Neither this Agreement or any Related Writing,
nor any written statement made by Borrower in connection herewith or
therewith, contains any untrue statement of a material fact or omits a
material fact necessary to make the statements contained herein or therein
not misleading. There is no fact which Borrower has not disclosed to Banks
which has or is likely to have a material adverse effect on Borrower's,
property, business, operations, prospects, profitability or condition
(financial or otherwise) or on Borrower's ability to repay the Subject
Indebtedness as contemplated hereby and in the Related Writings.
4B.23 CONSUMMATION OF ACQUISITION -- All of the transactions contemplated
by the Acquisition Agreement to occur on or before the closing date set
forth therein, including, without limitation, the Acquisition, have been
duly consummated.
4C. CLOSING OF REFINANCING -- Prior to the effectiveness of the Refinancing
pursuant to subsection 2A.02 hereof, Borrower shall execute and deliver to each
Bank a Refinancing Revolving Note in accordance with subsection 2C.01. Upon
Borrower's execution and delivery of the Refinancing Revolving Notes, each of
the Banks agree to return to Borrower the Initial Revolving Notes and the Term
Notes and the same shall be either marked "cancelled" or "substituted".
5A. EVENTS OF DEFAULT -- Each of the following shall constitute an Event Of
Default hereunder:
5A.01 PAYMENTS -- If any principal included in the Subject Indebtedness
shall not be paid in full promptly when the same becomes payable; or if
any Subject Indebtedness (EXCEPT principal) or any other Debt of the
Companies or any thereof to Banks and NCB-Agent or any thereof (EXCEPT any
payable on demand) shall not be paid in full promptly when the same
becomes payable and shall remain unpaid for five (5)
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consecutive days thereafter; or if such of the Debt of the Companies or
any thereof to Banks and NCB-Agent or any thereof as may be payable on
demand shall not be paid in full within five (5) days after any actual
demand for payment.
5A.02 WARRANTIES -- If any representation, warranty or statement (other
than any made by any Bank or NCB-Agent) made in this Agreement or in any
Related Writing shall be false or erroneous in any respect when made or
deemed made, as the case may be.
5A.03 COVENANTS WITHOUT GRACE -- If any Company shall fail or omit to
perform or observe any provisions in subsections 3A.02, 3B.01 through
3B.03 (inclusive) or 3D.01 through 3D.10 (inclusive).
5A.04 COVENANTS WITH GRACE -- If anyone (other than the Banks and
NCB-Agent and their respective agents) shall fail or omit to perform and
observe any agreement (other than those referred to in subsection 5A.01 or
5A.03 and not including the representations, warranties and statements
referred to in subsection 5A.02) contained in this Agreement or any
Related Writing that is on its part to be complied with, and that failure
or omission shall not have been fully corrected within ten (10) days after
the giving of written notice to Borrower by any Bank or NCB-Agent that it
is to be remedied.
5A.05 CROSS-DEFAULT -- If any indebtedness of any Company for borrowed
money (regardless of maturity) or any of its Funded Indebtedness shall be
or become "in default" (as defined below) EXCEPT any if and so long as the
aggregate unpaid principal balance of all such indebtedness in default
does not exceed Five Million Dollars ($5,000,000) at any one time
outstanding or if any Event of Default occurs pursuant to the Note
Purchase Agreement or upon the prepayment of the senior notes issued
pursuant thereto upon a Change in Control as provided in Section 8.4 of
the Note Purchase Agreement. In this subsection, "in default" means that
(a) there shall have occurred (or shall exist) in respect of the
indebtedness in question (either as in effect at the date of this
Agreement or as in effect at the time in question) any event, condition or
other thing which constitutes, or which with the giving of notice or the
lapse of any applicable grace period or both would constitute, a default
which accelerates (or permits any creditor or creditors or representative
or creditors to accelerate) the maturity of any such indebtedness; or (b)
any such indebtedness (other than any payable on demand) shall not have
been paid in full at its stated maturity; or (c) any such indebtedness
payable on demand shall not have been paid in full within ten (10) Banking
Days after any actual demand for payment.
5A.06 CONTROL -- If (x) any "person" or "group" shall become the
"beneficial owner" (as those terms are respectively used in the Securities
and Exchange Act of 1934, as amended, and the rules and regulations
thereunder) of more than fifty percent (50%) of the outstanding voting
stock of the Borrower or shall otherwise acquire the power (whether by
contract, by proxy or otherwise) to elect a majority of the Borrower's
board of directors or (y) during any twelve (12) month period, individuals
who were directors of the Borrower at the beginning of such period or were
elected to the Board of Directors
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of the Borrower with the approval of a majority of such directors shall
cease to constitute a majority of the Board of Directors.
5A.07 BORROWER'S SOLVENCY -- If (a) Borrower shall discontinue operations,
or (b) Borrower shall commence any Insolvency Action of any kind or admit
(by answer, default or otherwise) the material allegations of, or consent
to any relief requested in, any Insolvency Action of any kind commenced
against Borrower by its creditors or any thereof, or (c) any creditor or
creditors shall commence against Borrower any Insolvency Action of any
kind which shall remain in effect (neither dismissed nor stayed) for
ninety (90) consecutive days.
5A.08 SUBSIDIARIES' SOLVENCY -- If (a) any Subsidiary of Borrower shall
commence any Insolvency Action of any kind or admit (by answer, default or
otherwise) the material allegations of, or consent to any relief requested
in, any Insolvency Action of any kind commenced against that Subsidiary by
its creditors or any thereof, or (b) any creditor or creditors of any
Subsidiary of Borrower shall commence against that Subsidiary any
Insolvency Action of any kind which shall remain in effect (neither
dismissed nor stayed) for ninety (90) consecutive days.
5A.09 JUDGMENTS -- If one or more judgments for the payment of money in an
aggregate amount in excess of Five Million Dollars ($5,000,000) (or the
equivalent thereof if not denominated in Dollars) (unless such judgment
(i) shall have been reserved by the Borrower or the applicable Subsidiary
on the date hereof or (ii) shall be insured and the insurance carrier
shall have acknowledged in writing liability in respect of the full amount
thereof or shall have been ordered by a court of competent jurisdiction to
pay such judgment) shall be rendered and remain undischarged against the
Borrower or any of its Subsidiaries or any combination thereof and as to
which either (x) execution shall not be effectively stayed within a period
of thirty (30) consecutive days or (y) any action shall be legally taken
by a judgment creditor to levy upon assets or properties of the Borrower
or any of its Subsidiaries to enforce any such judgment.
5A.10 MATERIAL ADVERSE CHANGE -- If there shall occur any event, condition
or other thing that has, or in the Required Banks' reasonable judgment is
likely to have, a material adverse effect on the financial condition,
properties or business operations of the Companies taken as a whole or on
Banks' or NCB-Agent's ability to enforce any material right arising under
or in connection with this Agreement or any other Related Writing.
5B. EFFECTS OF DEFAULT -- Notwithstanding any contrary provision or inference
in this Agreement or in any Related Writing:
5B.01 OPTIONAL DEFAULTS -- If any Event Of Default referred to in
subsections 5A.01 through 5A.06, both inclusive, or 5A.09 or 5A.10 shall
occur and be continuing, the Required Banks shall have the right in their
discretion, by giving written notice to Borrower,
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(a) to terminate the Revolving Commitments (if not already expired
or reduced to zero pursuant to section 2B or terminated pursuant to
this section) and no Bank shall have any obligation thereafter to
grant any Revolving Loan to Borrower, and
(b) to accelerate the Maturity of all of the Subject Indebtedness
and all other Debt, if any, then owing to the Banks and NCB-Agent or
any thereof (other than Debt, if any, already due and payable) and
all such Debt shall thereupon become and thereafter be immediately
due and payable in full without any presentment or demand and
without any further or other notice of any kind, all of which are
hereby waived by Borrower.
5B.02 AUTOMATIC DEFAULTS --If any Event Of Default referred to in
subsection 5A.07 or 5A.08 shall occur,
(a) the Revolving Commitments shall automatically and immediately
terminate (if not already expired or reduced to zero pursuant to section
2B or terminated pursuant to this section) and no Bank shall have any
obligation thereafter to grant any Revolving Loan to Borrower, and
(b) all of the Subject Indebtedness and all other Debt, if any, then
owing to the Banks and NCB-Agent or any thereof (other than Debt, if any,
already due and payable) shall thereupon become and thereafter be
immediately due and payable in full, all without any presentment, demand
or notice of any kind, which are hereby waived by Borrower.
5B.03 OFFSETS -- If there shall occur or exist any Default Under This
Agreement then, so long as that Default Under This Agreement exists, each
Bank shall have the right at any time to set off against and to
appropriate and apply toward the payment of the Subject Indebtedness then
owing to it (and any participation purchased or to be purchased pursuant
to subsection 5B.05), whether or not the same shall then have matured,
any and all deposit balances then owing by that Bank to or for the credit
or account of the Companies or any thereof, all without notice to or
demand upon Borrower or any Subsidiary or any other person, all such
notices and demands being hereby expressly waived.
5B.04 EQUALIZATION -- Each Bank agrees with the other Banks that if at
any time it shall obtain any Advantage over the other Banks or any
thereof in respect of the Subject Indebtedness it will purchase from such
other Bank or Banks, for cash and at par, such additional participation
in the Subject Indebtedness owing to the other or others as shall be
necessary to nullify the Advantage. If any such Advantage resulting in
the purchase of an additional participation as aforesaid shall be
recovered in whole or in part from the Bank receiving the Advantage, each
such purchase shall be rescinded, and the purchase price restored (with
interest and other charges if and to the extent actually incurred by the
Bank receiving the Advantage) Ratably to the extent of the recovery.
During the existence of any Event of Default, any payment (whether made
voluntarily or
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involuntarily, by offset of any deposit or other indebtedness or
otherwise) of any indebtedness for borrowed money owing by Borrower to any
Bank shall be applied to the Subject Indebtedness owing to that Bank until
the same shall have been paid in full before any thereof shall be applied
to other indebtedness for borrowed money owing to that Bank.
6A. INDEMNITY: STAMP TAXES -- Borrower will pay all stamp taxes and similar
taxes, if any, including interest and penalties, if any, payable in respect of
the issuance of the Subject Indebtedness.
6B. INDEMNITY: GOVERNMENTAL COSTS/LIBOR-RATE LOANS -- If
(a) there shall be introduced or changed any treaty, statute, regulation
or other law, or there shall be made any change in the interpretation or
administration thereof, or there shall be made any request from any
central bank or other lawful governmental authority, the effect of any of
which events shall be to (1) impose, modify or deem applicable any reserve
or special deposit requirements against assets held by or deposits in or
Loans by any national banking association or other commercial banking
institution (whether or not applicable to any Bank) or any Bank or (2)
subject any Bank to any tax, duty, fee, deduction or withholding or (3)
change the basis of taxation of payments due to any Bank from Borrower
(otherwise than by a change in taxation of that Bank's overall Net
Income), or (4) impose on any Bank any penalty in respect of any loans
bearing interest at a LIBOR rate and
(b) in that Bank's sole opinion any such event (1) increases (or, if the
event were applicable to that Bank, would increase) the cost of making,
funding or maintaining any loans at such rate or (2) reduces the amount of
any payment to be made to that Bank in respect of the principal or
interest on any loans bearing interest at such rate or other payment under
this Agreement, then, within fifteen (15) business days of such Bank's
demand, Borrower shall from time to time pay Bank an amount equal to each
such cost increase or reduced payment, as the case may be.
6C. INDEMNITY: FUNDING COSTS -- Borrower agrees to indemnify each Bank against
any loss relating in any way to its funding of any loan bearing interest at a
LIBOR rate paid before its stated Maturity (whether a prepayment or a payment
following any acceleration of Maturity) and to pay that Bank, as liquidated
damages for any such loss, an amount (discounted to the present value in
accordance with standard financial practice at a rate equal to the Treasury
Yield) equal to interest computed on the principal payment from the payment
date to the respective stated maturities thereof at a rate equal to the
difference of the contract rate less the Treasury Yield, all as determined by
the Bank in its reasonable discretion. "Treasury Yield" means the annual yield
on direct obligations of the United States having a principal amount and
Maturity similar to that of the principal being paid.
6D. CREDIT REQUESTS -- Whenever Borrower shall revoke any Credit Request for a
LIBOR loan, or shall for any other reason fail to borrow pursuant thereto or
otherwise comply
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therewith, or shall fail to honor any prepayment notice, then, in each case on
any Bank's demand, Borrower shall pay each Bank such amount as will compensate
it for any loss, cost or expense incurred by it by reason of its liquidation
or reemployment of deposits or other funds.
6E. INDEMNITY: UNFRIENDLY TAKEOVERS -- Borrower agrees to indemnify each Bank
and NCB-Agent (each an "Indemnitee") and hold each Indemnitee harmless from
and against any and all liabilities, losses, damages, costs and expenses of
any kind (including, without limitation, the reasonable fees and disbursements
of counsel in connection with any investigative, administrative or judicial
proceeding, whether or not such Indemnitee shall be designated a party
thereto) which may be incurred by each Indemnitee relating to or arising out
of any actual or proposed use of proceeds of the Revolving Loans in connection
with the financing of an acquisition of any corporation or other business
entity, PROVIDED that no Indemnitee shall have the right to be indemnified
hereunder for its own gross negligence or willful misconduct as determined by
a court of competent jurisdiction.
6F. INDEMNITY: CAPITAL REQUIREMENTS -- If
(a) at any time any governmental authority shall require any Bank (or any
corporate shareholder of that Bank), whether or not the requirement has
the force of law, to maintain, as support for that Bank's Revolving
Commitment, capital in a specified minimum amount that either is not
required or is greater than that required at the date of this Agreement,
whether the requirement is implemented pursuant to the "risk-based capital
guidelines" (published at 12 CFR 3 in respect of "national banking
associations", 12 CFR 208 in respect of "state member banks" and 12 CFR
225 in respect of "bank holding companies") or otherwise, and
(b) as a result thereof the rate of return on capital of that Bank or its
shareholder or both (taking into account their then policies as to capital
adequacy and assuming full utilization of their capital) shall be directly
or indirectly reduced by reason of any new or added capital thereby
allocable to that Bank's Revolving Commitment,
then and in each such case Borrower shall, on that Bank's demand, pay that
Bank as an additional fee such amounts as will in that Bank's reasonable
opinion reimburse that Bank or its shareholder for any such reduced rate of
return.
6G. INDEMNITY: COLLECTION COSTS -- If any Event Of Default shall occur and
shall be continuing, Borrower will pay the Banks and NCB-Agent such further
amounts, to the extent permitted by law, as shall cover their respective costs
and expenses (including, without limitation, the reasonable fees
interdepartmental charges and disbursements of its counsel) incurred in
collecting the Subject Indebtedness or in otherwise enforcing its rights and
remedies in respect thereof.
6H. CERTIFICATE FOR INDEMNIFICATION -- Each demand by NCB-Agent or a Bank for
payment pursuant to section 6A, 6B, 6C, 6D, 6E, 6F or 6G shall be accompanied
by a certificate setting forth the reason for the payment, the amount to be
paid, and the computations
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and assumptions in determining the amount, which certificate shall be presumed
to be correct in the absence of manifest error. In determining the amount of
any such payment, each Bank may use reasonable averaging and attribution
methods.
7A. BANK'S PURPOSE -- Each Bank represents and warrants to the other Banks and
to Borrower that such Bank is familiar with the Securities Act of 1933 as
amended and the rules and regulations thereunder and is not entering into this
Agreement with any intention of violating that Act or any rule or regulation
thereunder, it being understood, however, that each Bank shall at all times
retain full control of the disposition of its assets.
7B. NCB-AGENT -- Each Bank irrevocably appoints NCB to be its agent with full
authority to take such actions, and to exercise such powers, on behalf of the
Banks in respect of this Agreement and the Related Writings as are therein
respectively delegated to NCB-Agent or as are reasonably incidental to those
delegated powers.
7B.01 NATURE OF APPOINTMENT -- NCB-Agent shall have no fiduciary
relationship with any Bank by reason of this Agreement and the Related
Writings, nor shall NCB-Agent have any duty or responsibility whatever to
any Bank EXCEPT those expressly set forth in this Agreement and the
Related Writings. Without limiting the generality of the foregoing, each
Bank acknowledges that NCB-Agent is acting as such solely as a convenience
to the Banks and not as a manager of the Subject Loans or Subject
Indebtedness. This section 7B does not confer any rights upon Borrower or
anyone else (EXCEPT NCB-Agent and the Banks), whether as a third party
beneficiary or otherwise.
7B.02 NCB AS A BANK; OTHER TRANSACTIONS -- NCB's rights under this
Agreement and the Related Writings shall not be affected by its serving as
NCB-Agent. NCB and its affiliates may generally transact any banking,
financial, trust, advisory or other business with Borrower (including,
without limitation, the acceptance of deposits, the extension of credit,
forward exchange rate contracts, interest rate caps, swaps, collars and
other like contracts and the acceptance of fiduciary appointments) without
notice to the Banks, without accounting to the Banks, and without
prejudice to NCB's rights as a Bank under this Agreement and the Related
Writings.
7B.03 INSTRUCTION FROM BANKS -- NCB-Agent shall not be required to
exercise any discretion or take any action as to matters not expressly
provided for by this Agreement and the Related Writings (including,
without limitation, collection and enforcement actions in respect of the
Subject Indebtedness and any collateral therefor) EXCEPT that NCB-Agent
shall take such action (or omit to take such action) as may be reasonably
requested of it in writing by the Required Banks, which instructions and
which actions and omissions shall be binding upon all the Banks; PROVIDED,
that NCB-Agent shall not be required to act (nor omit any act) if, in its
reasonable judgment, any such action or omission might expose NCB-Agent to
personal liability or might be contrary to this Agreement, any Related
Writing or any applicable law.
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7B.04 BANKS' DILIGENCE -- Each Bank
(a) represents and warrants that it has made its decision to enter
into this Agreement and the Related Writings and
(b) agrees that it will make its own decision as to taking or not
taking future actions in respect of this Agreement and the Related
Writings
in each case without reliance on NCB-Agent or any other Bank and on the
basis of its independent credit analysis and its independent examination
of and inquiry into such documents and other matters as it deems relevant
and material.
7B.05 NO IMPLIED REPRESENTATIONS -- NCB-Agent shall not be liable for any
representation, warranty, agreement or obligation of any kind of any other
party to this Agreement or anyone else, whether made or implied by
Borrower in this Agreement or any Related Writing or by a Bank in any
notice or other communication or by anyone else or otherwise.
7B.06 SUB-AGENTS -- NCB-Agent may employ agents and shall not be liable
(EXCEPT as to money or property received by it or its agents) for any
negligence or misconduct of any such agent selected by it with reasonable
care. NCB-Agent may consult with legal counsel, certified public
accountants and other experts of its choosing (including, without
limitation, NCB's salaried employees, any employed by Borrower or any
otherwise not independent) and shall not be liable for any action or
inaction taken or suffered in good faith by it in accordance with the
advice of any such counsel, accountants or other experts.
7B.07 NCB-AGENT'S DILIGENCE -- NCB-Agent shall not be required (a) to keep
itself informed as to anyone's compliance with any provision of this
Agreement or any Related Writing, (b) to make any inquiry into the
properties, financial condition or operations of Borrower or any other
matter relating to this Agreement or any Related Writing, (c) to report to
any Bank any information (other than which this Agreement or any Related
Writing expressly requires to be so reported) that NCB-Agent or any of its
affiliates may have or acquire in respect of Borrower's properties,
business or financial condition or any other matter relating to this
Agreement or any Related Writing or (d) to inquire into the validity,
effectiveness or genuineness of this Agreement or any Related Writing.
7B.08 NOTICE OF DEFAULT -- NCB-Agent shall not be deemed to have knowledge
of any Event of Default unless and until it shall have received a written
notice describing it and citing the relevant provision of this Agreement
or any Related Writing.
7B.09 NCB-AGENT'S LIABILITY -- Neither NCB-Agent nor any of its directors,
officers, employees, attorneys and other agents shall be liable for any
action or omission on their respective parts EXCEPT for gross negligence
or willful misconduct.
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7B.10 COMPENSATION -- At the execution and delivery of this Agreement and
annually thereafter so long as any Subject Loans are outstanding, Borrower
shall pay NCB-Agent a fee to be determined by mutual agreement of Borrower
and NCB-Agent. Except as otherwise provided herein, NCB-Agent shall
receive no other compensation for its services as agent of the Banks in
respect of this Agreement and the Related Writings, but Borrower shall
reimburse NCB-Agent periodically on its demand for out-of-pocket expenses.
if any, reasonably incurred by it as such.
7B.11 DISBURSEMENTS -- Whenever NCB-Agent shall receive any funds in
respect of the Subject Indebtedness or otherwise in respect of this
Agreement or any Related Writing, whether from Borrower for the account of
the Banks or from the Banks for the account of Borrower, NCB-Agent shall
disburse the funds on the day the funds shall be deemed to have been
received. NCB-Agent shall be entitled (but not obligated) to make a timely
disbursement of loan proceeds to Borrower before actually receiving funds
from the Banks (EXCEPT if and to the extent NCB-Agent shall have received
written instructions to the contrary from any Bank or Banks) and to make a
timely disbursement of payments to the Banks before actually receiving
funds from Borrower. If the funds to be disbursed are not received by
NCB-Agent on a timely basis, NCB-Agent at its option may (a) rescind the
disbursement and require the disbursee to return the funds in question
with interest or (b) require the party who failed to furnish the funds for
disbursement on a timely basis to pay NCB-Agent interest thereon -- the
interest in each case to be computed at the Federal Funds Rate and to be
paid on demand.
7B.12 NCB-AGENT'S INDEMNITY -- The Banks shall indemnify NCB-Agent (to the
extent NCB-Agent is not reimbursed by Borrower) from and against any loss
or liability (other than any caused by NCB-Agent's gross negligence or
willful misconduct) incurred by NCB-Agent as such in respect of this
Agreement or any Related Writing and from and against any out-of-pocket
expenses incurred in defending itself or otherwise related to this
Agreement or any Related Writing including, without limitation, reasonable
fees and disbursements of legal counsel of its own selection (including,
without limitation, the reasonable interdepartmental charges of its
salaried attorneys) in the defense of any claim against it or in the
prosecution of its rights and remedies as NCB-Agent; PROVIDED, that each
Bank shall be liable for only its Ratable share of the whole loss or
liability.
7B.13 RESIGNATION -- NCB-Agent (or any successor) may resign as such at
any time upon ten (10) days' prior written notice to Borrower and to each
Bank, in which event the Required Banks may appoint a successor agent by
giving written notice thereof to Borrower and the resigning agent. In the
absence of a timely appointment, NCB-Agent shall have the right (but not
the duty) to make a temporary appointment of any Bank (but only with that
Bank's consent) to act as its successor pending an appointment pursuant to
the next preceding sentence. In either case, the successor agent shall
deliver its written acceptance of appointment to Borrower, to each Bank
and to the former agent. Thereupon the successor agent shall automatically
acquire and assume all the rights and duties as those prescribed for
NCB-Agent by this section 7B. Any resigning agent shall
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execute and deliver such assignments and other writings as the successor
agent may reasonably require to facilitate its becoming the successor
agent.
7C. TRANSFER OF SUBJECT LOANS -- Each Bank shall have the right at any time or
times to transfer its Subject Loans (or commitment to make the same) in whole
or in part and without recourse to another financial institution (provided
that such transfers shall be in a minimum amount of $10,000,000), PROVIDED, in
each such case. that the transferor and the transferee shall have complied
with the following requirements:
7C.01 PRIOR CONSENT -- No Subject Loans (or commitment to make the same)
may be transferred, either in whole or in part, without the prior written
consent of Borrower and NCB-Agent, neither of which consents shall be
unreasonably withheld.
7C.02 AGREEMENT -- The transferee shall execute and deliver to Borrower,
NCB-Agent and each Bank (other than any transferor which thereafter will
have no interest in any Subject Loans or any commitment to make the same)
a counterpart of this Agreement and such additional amendments, assurances
and other writings as NCB-Agent may reasonably require.
7C.03 NOTE -- Borrower shall execute and deliver to the transferee an
appropriate Revolving Note or Revolving Notes, or Term Note or Term Notes,
as the case may be, and an appropriate release to the transferor.
7C.04 PARTIES -- Upon satisfaction of the requirements of this section 7C,
(a) the transferee shall become and thereafter be deemed to be a Bank
for the purposes of this Agreement and
(b) The transferor (i) shall continue to be a Bank for the purposes of
this Agreement only if and to the extent that the transfer shall not
have been a transfer of its entire interest in the Subject Loans (or
commitment to make the same) and (ii) shall cease to be and thereafter
shall no longer be deemed to be a Bank in the case of any transfer of
its entire interest in the Subject Loans (or commitment to make the
same).
7C.05 PROCESSING FEE -- The transferor Bank and/or the transferee Bank
shall pay to NCB-Agent, for its own account, a processing fee of Three
Thousand Dollars ($3,000) for each such transfer on or prior to the
effective date thereof.
7D. PARTICIPATION OF SUBJECT LOANS -- Each Bank shall have the right at any
time or times to sell or otherwise transfer participating interests its
Subject Loans in whole or in part (provided that such participating interests
shall be in a minimum amount of $5,000,000) and without recourse, PROVIDED,
that Borrower and NCB-Agent retain the right, for the purposes of this
Agreement, to continue to treat the seller as the sole record holder of the
Subject Loan or Subject Loans in question EXCEPT if and to the extent the
seller's Revolving Commitment
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shall have been transferred in accordance with section 7C. In the event of a
participation, the selling Bank will remain the holder of all applicable
notes.
8. INTERPRETATION -- This Agreement and the Related Writings (other than the
Acquisition Agreement and the Acquisition Documents) shall be governed by the
following provisions:
8.01 WAIVERS -- The Banks and NCB-Agent may from time to time grant
waivers and consents in respect of this Agreement or any Related Writing
or assent to amendments thereof, but no such waiver, consent or assent
shall be binding upon the Banks and NCB-Agent or any thereof unless (a)
it shall have been reduced to writing, each such writing to be narrowly
construed and (b) the waiver, consent or amendment shall have been
approved by the Required Banks; provided, however, that (i) no amendment,
waiver or consent shall, unless in writing and signed by all Banks
directly affected thereby, do any of the following at any time: (A) change
the percentage of the Revolving Commitments or the aggregate unpaid
principal amount of the Revolving Notes, (B) change the number or
percentage of Banks that shall be required for the Banks or any of them to
take any action hereunder or change the percentage contained in the
definition of Required Banks, (C) amend this subsection 8.01, (D) decrease
the principal amount of, or extend the maturity of or any scheduled
principal or interest payment date for, any Revolving Loan, (E) waive or
excuse any payment or any part thereof, (F) decrease the rate of interest
on any Revolving Loan, or (G) change or delay the fees payable to the
affected Bank and (ii) no amendment, waiver or consent shall affect the
rights or duties of NCB-Agent without the prior written consent of
NCB-Agent. Without limiting the generality of the foregoing, Borrower
agrees that no course of dealing in respect of, nor any omission or delay
in the exercise of any right, power or privilege by Banks and NCB-Agent or
any thereof shall operate as a waiver thereof, nor shall any single or
partial exercise thereof preclude any further or other exercise thereof or
of any other right, power or privilege, and each such right, power or
privilege may be exercised either independently or concurrently with
others and as often and in such order as the party or parties exercising
the same may deem expedient.
8.02 CUMULATIVE PROVISIONS -- Each right, power or privilege specified or
referred to in this Agreement or any Related Writing is in addition to and
not in limitation of any other rights, powers and privileges that Banks
and NCB-Agent may respectively otherwise have or acquire by operation of
law, by other contract or otherwise. All rights, powers and privileges
shall be deemed cumulative.
8.03 BINDING EFFECT -- The provisions of this Agreement and the Related
Writings shall bind and benefit Borrower, NCB-Agent and each Bank and
their respective successors and assigns, including each subsequent holder,
if any, of the Revolving Notes or any thereof; PROVIDED, that no person or
entity other than Borrower may obtain Revolving Loans and Borrower may not
assign its rights or obligations hereunder without the Required Banks'
consent; and PROVIDED, FURTHER, that neither any holder of any
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Revolving Note or assignee of any Revolving Loan, whether in whole or in
part, shall thereby become obligated thereafter to grant to Borrower any
Revolving Loan.
8.04 SURVIVAL OF PROVISIONS -- All representations and warranties made in
or pursuant to this Agreement or any Related Writing shall survive the
execution and delivery of this Agreement, the Term Notes and the Revolving
Notes. The provisions of section 6 (inclusive) and subsection 7B.12 shall
survive the payment of the Subject Indebtedness.
8.05 IMMEDIATE U.S. FUNDS -- Any reference to money is a reference to
lawful money of the United States of America which, if in the form of
credits, shall be in immediately available funds.
8.06 CAPTIONS -- The several captions to different sections and
subsections of this Agreement are inserted for convenience only and shall
be ignored in interpreting the provisions thereof.
8.07 SUBSECTIONS -- Each reference to a section includes a reference to
all subsections thereof (i.e., those having the same character or
characters to the left of the decimal point) EXCEPT where the context
clearly does not so permit.
8.08 ILLEGALITY -- If any provision in this Agreement or any Related
Writing shall for any reason be or become illegal, void or unenforceable,
that illegality, voidness or unenforceability shall not affect any other
provision.
8.09 OHIO LAW -- This Agreement and the Related Writings and the
respective rights and obligations of the parties hereto shall be construed
in accordance with and governed by internal Ohio law.
8.10 INTEREST/FEE COMPUTATIONS -- All interest and all fees for any given
period shall accrue on the first (1st) day thereof but not on the last day
thereof and in each case shall be computed on the basis of a 360-day year
and the actual number of days elapsed. In no event shall interest accrue
at a higher rate than the maximum rate, if any, permitted by law.
8.11 NOTICE -- A notice to or request of Borrower shall be deemed to have
been given or made under this Agreement or any Related Writing either upon
the delivery of a writing to that effect (either in person or by
transmission of a telecopy) to an officer of Borrower or five (5) days
after a writing to that effect shall have been deposited in the United
States mail and sent, with postage prepaid, by registered or certified
mail, properly addressed to Borrower (Attention: chief financial officer).
No other method of actually giving written notice to or making a written
request of Borrower is hereby precluded Every notice required to be given
to NCB-Agent or any Bank pursuant to this Agreement or any Related Writing
shall be delivered (either in person or by transmission of a telecopy) to
an Account Officer of that party. The Banks and NCB-Agent each agree to
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give prompt notice to the others whenever it gives any notice pursuant to
section 5A or 5B or grants any waiver or consent as provided in subsection
8.01. A notice or request by mail is properly addressed to a party when
addressed to it at the address set forth opposite its signature below or
at such other address as that party may furnish to each of the others in
writing for that purpose. A telecopy is transmitted to a party when
transmitted to the telecopy number set forth opposite that party's
signature below (or at such other telecopy number as that party may
furnish to the other in writing for that purpose).
8.12 ACCOUNTING TERMS -- Any accounting term used in this Agreement shall
have the meaning customarily ascribed thereto by GAAP subject, however, to
such modification, if any, as may be provided by section 9 or elsewhere in
this Agreement.
8.13 ENTIRE AGREEMENT -- This Agreement and the Related Writings referred
to in or otherwise contemplated by this Agreement set forth the entire
agreement of the parties as to the transactions contemplated by this
Agreement. This Agreement amends and restates a certain Credit Agreement
dated July 6, 1995 entered into between and among Borrower, NCB-Agent,
National City Bank and ABN Amro Bank N.V. This Agreement is not intended
as a novation of the obligations of Borrower under the original Credit
Agreement but rather is merely a restatement of the obligations thereunder
after giving effect to certain amendments agreed upon between the parties.
8.14 WAIVER OF JURY TRIAL -- THE PARTIES ACKNOWLEDGE AND AGREE THAT ANY
CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT AND THE RELATED WRITINGS
WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND THEREFORE AGREE THAT ANY
LAW SUIT GROWING OUT OF OR INCIDENTAL, TO ANY SUCH CONTROVERSY WILL BE
TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A
JURY.
8.15 LATE CHARGE; APPLICATION OF PAYMENTS --If Borrower fails to pay any
amount due hereunder, or any fee in connection herewith, in full within
ten (10) days after its due date, Borrower will, in each case, incur and
shall pay a late charge equal to the greater of twenty dollars ($20.00) or
five percent (5%) of the unpaid amount. The payment of a late charge will
not cure or constitute a waiver of any Event Of Default under this
Agreement. Except as otherwise agreed in writing, payments will be applied
first to accrued but unpaid interest and fees, in that order, on an
invoice by invoice basis in the order of their respective due dates, until
paid in full, then to late charges and then to principal.
8.16 EXPENSES -- Borrower agrees to reimburse each Bank, on that Bank's
demand from time to time, for any and all fees, costs and expenses
(including, without limitation, the fees, interdepartmental charges and
disbursements of legal counsel) incurred by that Bank in connection with
(a) preparing any amendments or modifications to this Agreement or any
Related Writing, (b) administering this Agreement and the Subject
Indebtedness evidenced and contemplated hereby and by the other Related
Writings, (c)
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any filing or recording fees, lien search fees, documentary stamp taxes or
other like fees, taxes or charges, (d) any litigation, contest, dispute,
suit, proceeding or action (whether instituted by Banks, Borrower or any
other Person) in any way relating to the Subject Indebtedness, this
Agreement or any of the other Related Writings or Borrower's affairs, but
excluding any litigation between Borrower and Bank as adverse parties
unless otherwise permitted by law in connection with any judgment awarded
in favor of the prevailing party or (e) any inspection, verification or
protection of any of Banks' collateral for the Subject Indebtedness.
Borrower's reimbursement obligations hereunder shall constitute a part of
Borrower's Debt.
8.17 JURISDICTION AND VENUE -- As part of the consideration for new value
received, Borrower hereby consents to the jurisdiction of any state or
federal court located within the state of Ohio and consents that all such
service of process be made by registered or certified mail directed to
such Borrower at the address set forth opposite its name and officer's
signature on the execution page hereof and service so made shall be deemed
to be completed upon actual receipt thereof. Borrower waives any objection
to jurisdiction and venue of any action instituted hereunder or in
connection with any Related Writing and agrees not to assert any defense
based on lack of jurisdiction or venue. Nothing contained herein shall
affect the right of Banks or NCB-Agent to serve legal process in any other
manner permitted by law or affect the right of Banks or NCB-Agent to
bring any action or proceeding against Borrower or its property in the
courts of any other jurisdiction. Borrower agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner
provided by law.
8.18 AMBIGUITIES -- Borrower and Banks acknowledge that this Agreement and
the Related Writings have been entered into in the context of free and
understanding negotiations and are the product of individual bargaining,
in a competitive market, between parties enjoying equal bargaining
strength. In the event that a court is called upon to interpret any
ambiguous provision in this Agreement or the Related Writings, Borrower
and Banks agree that the ambiguity shall not be construed against Borrower
or Banks simply because Borrower or Banks, or their respective agents or
counsel, may have drafted such provision.
8.19 OTHER WAIVERS AND ACKNOWLEDGMENT -- Except as otherwise provided for
in this Agreement or as required by applicable law, Borrower waives (i)
presentment, demand and protest and notice of presentment, protest,
default, nonpayment, maturity, release, compromise, settlement, extension
or renewal of any or all commercial paper, accounts, contract rights,
documents, instruments, chattel paper and guaranties at any time held by
Banks or NCB-Agent on which Borrower may in any way be liable and (ii)
notice prior to taking possession or control of any collateral which might
be required by any court prior to allowing Banks to exercise any of Banks'
or NCB-Agent's remedies.
Borrower acknowledges that it has been advised by counsel of its choice
with respect to this Agreement and the transactions contemplated hereby,
and Borrower acknowledges and
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agrees that (a) each of the waivers set forth herein, were knowingly and
voluntarily made; (b) the rights of Banks and NCB-Agent hereunder shall be
strictly construed in favor of Banks and NCB-Agent, as the case may be;
and (c) no representative of Banks or NCB-Agent has waived or modified
any of the provisions of this Agreement or any Related Writing as of the
date hereof and no such waiver or modification following the date hereof
shall be effective unless made in accordance with section 8.01 hereof.
8.20 CONFIDENTIALITY -- Each Bank hereby (a) acknowledges that the
Companies have many trade secrets and much financial, environmental and
other data and information the confidentiality of which is important to
their business and (b) agrees to keep confidential any such trade secret,
data or other information designated by a Company as confidential, except
that this section shall not preclude any Bank from furnishing any such
secret, data or information (i) as may be required by order of any court
of competent jurisdiction or requested by any governmental agency having
any regulatory authority over such Bank or its securities or in response
to legal process, (ii) to any other party to this Agreement, (iii) or to
any actual or perspective transferee, participant or sub-participant (so
long as such perspective transferee, participant or subparticipant is a
financial institution) of all or part of that Bank's rights arising out of
or in connection with the Related Writings and this Agreement or any
thereof so long as such perspective transferee, participant or
sub-participant to whom disclosure is made agrees to be bound by the
provisions of this Section 8.20, (iv) to anyone if it shall have been
already publicly disclosed (other than by that Bank in contravention of
this Section 8.20), (v) to the extent reasonably required in connection
with the exercise of any right or remedy under this Agreement or any
Related Writing and (vi) to that Bank's legal counsel, auditors and
accountants.
9. DEFINITIONS -- As used in this Agreement and in the Related Writings,
EXCEPT where the context clearly requires otherwise,
ACCEPTABLE MARKETABLE SECURITIES means securities that are direct
obligations of the United States of America or any agency thereof, or
certificates of deposit issued by any Bank or by any other financial
institution organized under the laws of the United States or any state
thereof which is approved in writing by NCB-Agent, in NCB-Agent's
reasonable discretion, or any other money-market investment if it carries
the highest quality of rating of any nationally recognized rating agency
or any repurchase agreements issued by banks continuously secured by
obligations issued or guaranteed and backed by the full faith and credit
of the United States of America; provided, however, that no such security
shall mature more than ninety (90) days after the date when made;
ACCOUNT OFFICER means that officer who at the time in question is
designated by the Bank in question as the officer having primary
responsibility for giving consideration to Borrower's requests for credit
or, in that officer's absence, that officer's immediate superior or any
other officer who reports directly to that superior officer;
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ACCUMULATED FUNDING DEFICIENCY shall have the meaning ascribed thereto in
section 302(a)(2) of ERISA;
ACQUISITION is identified in subsection 2D.01;
ACQUISITION AGREEMENT means that certain Stock Purchase Agreement between
Seller and Borrower, dated December 20, 1996;
ACQUISITION DOCUMENTS means any instrument, agreement, financial
statement, notice, officer's certificate or other document or writing of
any kind which is delivered to Borrower or Seller and which is relevant in
any manner to the Acquisition Document;
ACQUISITION PROJECTIONS means those certain projections titled "Project
Raleigh--Merger and Acquisition Analysis, prepared by Borrower and
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ and delivered to Banks.
ADJUSTED FUNDED INDEBTEDNESS/EBITDA Ratio means a ratio, calculated in
accordance with GAAP on a rolling four (4) quarter basis, of the sum of
(a) the Maximum Outstanding Amount for such period plus (b) the
consolidated amount of Funded Indebtedness of the Companies plus (c) the
consolidated amount of all other indebtedness for borrowed money of the
Companies (excluding in the case of clauses (b) and (c) the principal
amount of the Revolving Loans outstanding at such time) to the
consolidated EBITDA of the Companies for the same period;
ADVANTAGE means any payment (whether made voluntarily or involuntarily, by
offset of any deposit or other indebtedness or otherwise) received by a
Bank in respect of the Subject Indebtedness if the payment results in that
Bank's having less than its Ratable share of the Subject Indebtedness in
question;
AFFILIATE, when used with reference to any corporation (or other business
entity) (the "subject") means, a corporation (or other business entity) or
person that is in control of or under the control of or under common
control (by another) with the subject; the term control meaning the direct
or indirect power to direct the management or policies of the subject or
the Affiliate or both (as the case may be), whether through the direct or
indirect ownership of voting securities, by contract or otherwise;
AGREEMENT means this Agreement and includes each amendment, supplement or
restatement, if any, to this Agreement;
BANK means one of the banking institutions that is a party to this
Agreement;
BANKING DAY means (a) in the case of a LIBOR Loan, a day on which banks in
the London interbank market deal in United States dollar deposits and on
which banking institutions are generally open for domestic and
international business in Cleveland and in New York City and (b) in any
other case, any day other than a Saturday or a Sunday
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or a public holiday or other day on which banking institutions in
Cleveland, Ohio are generally closed and do not conduct banking business;
BORROWER means OM GROUP, INC., a Delaware corporation;
CERCLA means the Comprehensive Environmental Response, Compensation and
Liability Act (42 USC 9601 et seq.) as amended;
COMPANY refers to Borrower or to a Subsidiary of Borrower, as the case may
be and COMPANIES refers to Borrower and its Subsidiaries;
COMPENSATION includes all considerations or remuneration (including
without limitation, deferred compensation and disbursements to trusts),
whatever the form or kind, for services rendered;
CONVERSION/CONTINUATION REQUEST means a request made pursuant to
subsection 2D.07;
CREDIT REQUEST means a request made pursuant to subsection 2C.02;
CURRENT ASSETS means the net book value of all such assets (after
deducting applicable reserves, if any, and without consideration to any
reappraisal or write-up of assets) as determined in accordance with GAAP;
CURRENT GUARANTORS means, collectively, each of OMG Americas, Inc., OMG
Apex, Inc. and Target;
CURRENT LIABILITIES means all such liabilities as determined in accordance
with GAAP and includes (without limitation) all accrued taxes and all
principal of any Funded Indebtedness maturing within twelve months of the
date of determination;
DEBT means, collectively, all liabilities (including principal, interest,
fees, charges, expenses and any other amounts) of the party or parties in
question to the Banks and NCB-Agent or any thereof, whether owing by one
such party alone or with one or more others in a joint, several, or joint
and several capacity, whether now owing or hereafter arising, whether
owing absolutely or contingently, whether created by loan, overdraft,
guaranty of payment or other contract or by quasi-contract or tort,
statute or other operation of law or otherwise, whether incurred directly
to the Banks and NCB-Agent of any thereof or acquired by purchase, pledge
or otherwise, and whether participated to or from the Banks and NCB-Agent
or any thereof in whole or in part; and in the case of Borrower includes,
without limitation, the Subject Indebtedness;
DEFAULT UNDER ERISA means (a) the occurrence or existence of a material
Accumulated Funding Deficiency in respect of any of the Companies' Pension
Plans, (b) any material failure by a Company to make a full and timely
payment of premiums required by ERISA for insurance against any employer's
liability in respect of any such plan, (c) any material
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breach of a fiduciary duty by a Company or any trustee in respect of any
such plan or (d) the existence of any action for the forcible termination
of any such plan;
DEFAULT UNDER THIS AGREEMENT means an event, condition or thing which
constitutes (or which with the lapse of any applicable grace period or the
giving of notice or both would constitute) an Event Of Default referred to
in section 5A and which has not been appropriately waived in writing in
accordance with this Agreement or corrected to the Required Banks' full
satisfaction;
DISTRIBUTION means a payment made, liability incurred or other
consideration (other than any stock dividend or stock split payable solely
in capital stock of Borrower) given by a Company for the purchase,
acquisition, redemption or retirement of any capital stock of the Company
or as a dividend, return of capital or other Distribution in respect of
the Company's capital stock and DISTRIBUTE means to make a Distribution;
EBITDA means, at the time and for the period of reference thereto, the
Companies' consolidated Net Income for that period plus the Companies'
consolidated interest expense for that period plus the Companies'
consolidated federal, state and local income taxes for that period plus
the Companies' consolidated depreciation and amortization expense for that
period;
ENVIRONMENTAL LAW means CERCLA, the Hazardous Material Transportation Act
(49 USC 1801 et seq.), the Resource Conservation and Recovery Act (42 USC
6901 et seq.), the Federal Water Pollution Control Act (33 USC 1251 et
seq.), the Toxic Substances Control Act (15 USC 2601 et seq.) and the
Occupational Safety and Health Act (29 USC 651 et seq.), as such laws have
been or hereafter may be amended, and any and all analogous present or
future federal, state or local statutes and the regulations promulgated
pursuant thereto;
ERISA means the Employee Retirement Income Security Act of 1974 (P.L.
93-406) as amended from time to time and in the event of any amendment
affecting any section thereof referred to in this Agreement, that
reference shall be a reference to that section as amended, supplemented,
replaced or otherwise modified;
ERISA AFFILIATE of any Person means any other Person that for purposes of
Title IV of ERISA is a member of such persons controlled group, or under
common control with such Person, within the meaning of Section 414 of the
Internal Revenue Code of 1986, as amended from time to time;
ERISA REGULATOR means any governmental agency (such as the Department of
Labor, The Internal Revenue Service and the Pension Benefit Guaranty
Corporation) having any regulatory authority over any Pension Plan;
EUROCURRENCY LIABILITIES has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time;
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EUROCURRENCY RESERVE PERCENTAGE means, for any LIBOR Contract Period in
respect of any Series of Subject Loans comprised by LIBOR Loans, as of
any date of determination, the aggregate of the then stated maximum
reserve percentages (including any marginal, special, emergency or
supplemental reserves), expressed as a decimal, applicable to such LIBOR
Contract Period (if more than one such percentage is applicable, the daily
average of such percentages for those days in such LIBOR Contract Period
during which any such percentage shall be so applicable) by the Board of
Governors of the Federal Reserve System, any successor thereto, or any
other banking authority, domestic or foreign, to which NCB-Agent may be
subject in respect to eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Federal Reserve Board)
or in respect of any other category of liabilities including deposits by
reference to which the interest rate on LIBOR Loans is determined or any
category of extension of credit or other assets that include the Series of
LIBOR Loans. For purposes hereof, such reserve requirements shall include,
without limitation, those imposed under Regulation D of the Federal
Reserve Board and the LIBOR Loans shall be deemed to constitute
Eurocurrency Liabilities subject to such reserve requirements without
benefit of credits for proration, exceptions or offsets which may be
available from time to time to NCB-Agent under said Regulation D;
EVENT OF DEFAULT is defined in section 5A;
EXPIRATION DATE means the date referred to as such in subsection 2B.02,
EXCEPT that in the event of any extension pursuant to subsection 2B.05,
"Expiration Date" shall mean the latest date to which the Revolving
Commitments shall have been so extended;
FEDERAL FUNDS RATE means a fluctuating interest rate per annum, as in
effect at the time in question, that is the rate determined by Bank to be
the opening Federal Funds Rate per annum paid or payable by it on the day
in question in its regional federal funds market for overnight borrowings
from other banking institutions;
FUNDED INDEBTEDNESS means indebtedness of the person or entity in question
which matures or which (including each renewal or extension, if any, in
whole or in part) remains unpaid for more than twelve (12) months after
the date originally incurred and includes, without limitation (a) any
indebtedness (regardless of its maturity) if it is renewable or refundable
in whole or in part solely at the option of that person or entity (in the
absence of default) to a date more than one (1) year after the date of
determination, (b) any capitalized lease, (c) any Guaranty of Funded
Indebtedness owing by another person or entity and (d) any long-term
indebtedness secured by a security interest, mortgage or other lien
encumbering any property owned or being acquired by the person or entity
in question even if the full faith and credit of that person or entity is
not pledged to the payment thereof; PROVIDED, that in the case of any
indebtedness payable in installments or evidenced by serial notes or
calling for sinking fund payments, those payments maturing within twelve
(12) months after the date of determination shall be considered current
indebtedness rather than Funded Indebtedness for the purposes of section
3B but shall be considered Funded Indebtedness for all other purposes;
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FUNDED INDEBTEDNESS/EBITDA Ratio means a ratio, calculated in accordance
with GAAP on a rolling four (4) quarter basis, of the sum of (a) the
consolidated amount of Funded Indebtedness of the Companies plus (b) the
consolidated amount of all other indebtedness for borrowed money of the
Companies to the consolidated EBITDA of the Companies for the same period;
GAAP means generally accepted accounting principles applied in a manner
consistent with those used in Borrower's Most Recent 4A.04 Financial
Statements;
GUARANTOR means one who pledges his credit or property in any manner for
the payment or other performance of the indebtedness, contract or other
obligation of another and includes (without limitation) any guarantor
(whether of collection or payment), any obligor in respect of a standby
letter of credit or surety bond issued for the obligor's account, any
surety, any co-maker, any endorser, and anyone who agrees conditionally or
otherwise to make any loan, purchase or investment in order thereby to
enable another to prevent or correct a default of any kind; and GUARANTY
means the obligation of a Guarantor;
INITIAL REVOLVING NOTE means a note executed and delivered by Borrower in
accordance with subsection 2C.01 hereof and being in the form and
substance of EXHIBIT C with the blanks appropriately filled;
INSIDER, as applied to Subordinated indebtedness, refers to Subordinated
indebtedness which at the time in question is owing to any person who is a
director or officer of a Company or who is the record and beneficial owner
of ten percent (10%) or more of a Company's capital stock or who is a
member of the immediate family of any such director, officers or
stockholder;
INSOLVENCY ACTION means either (a) a pleading of any kind filed by the
person, corporation or entity (an "insolvent") in question to seek relief
from the insolvent's creditors, or filed by the insolvent's creditors or
any thereof to seek relief of any kind against that insolvent, in any
court or other tribunal pursuant to any law (whether federal, state or
other) relating generally to the rights of creditors or the relief of
debtors or both, or (b) any other action of any kind commenced by an
insolvent or the insolvent's creditors or any thereof for the purpose of
marshaling the insolvent's assets and liabilities for the benefit of the
insolvent's creditors; and "Insolvency Action" includes (without
limitation) a petition commencing a case pursuant to any chapter of the
federal bankruptcy code, any application for the appointment of a
receiver, trustee, liquidator or custodian for the insolvent or any
substantial part of the insolvent's assets, and any assignment by an
insolvent for the general benefit of the insolvent's creditors;
LIBOR CONTRACT PERIOD is defined in subsection 2D.04;
LIBOR LOAN means a Subject Loan having a LIBOR Contract Period described
in subsection 2D.04 and bearing interest in accordance with subsection
2A.04 and 2C.05;
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LIBOR PRE-MARGIN RATE means, for any LIBOR Contract Period with respect to
a Series of Subject Loans comprised of LIBOR Loans, the quotient (rounded
upwards, if necessary, to the nearest one sixteenth of one percent (1/16th
of 1%) of: (x) the per annum rate of interest, determined by NCB-Agent in
accordance with its usual procedures (which determination shall be
conclusive absent manifest error) as of approximately 11:00 a.m. (London
time) two Banking Days prior to the beginning of such LIBOR Contract
Period pertaining to such Series of LIBOR Loans, appearing on Page 3750 of
the Telerate Service (or any successor or substitute page of such Service,
or any successor to or substitute for such Service providing rate
quotations comparable to those currently provided on such page of such
Service, as determined by NCB-Agent from time to time for purposes of
providing quotations of interest rates applicable to Dollar deposits in
the London interbank market) as the rate in the London interbank market
for Dollar deposits in immediately available funds with a maturity
comparable to such LIBOR Contract Period DIVIDED BY (y) a number equal to
1.00 MINUS the Eurocurrency Reserve Percentage. In the event that such
rate quotation is not available for any reason, then the rate (for
purposes of clause (x) hereof) shall be the rate, determined by NCB-Agent
as of approximately 11:00 a.m. (London time) two Banking Days prior to the
beginning of such LIBOR Contract Period pertaining to such Series of LIBOR
Loans, to be the average (rounded upwards, if necessary, to the nearest
one sixteenth of one percent (1/16th of 1%) of the per annum rates at
which Dollar deposits in immediately available funds in an amount
comparable to NCB's Ratable portion of such Series of LIBOR Loans and with
a maturity comparable to such LIBOR Contract Period are offered to the
prime banks by leading banks in the London interbank market. The LIBOR
Pre-Margin Rate shall be adjusted automatically on and as of the effective
date of any change in the Eurocurrency Reserve Percentage;
MATERIAL CONTRACT means those contracts, instruments or other documents
(other than this Agreement and the Related Writings) pertaining to a
Company pursuant to which: (1) a Company has any direct or indirect
obligation for borrowed money (including, without limitation, any
contingent liability under any guaranty) or for the deferred portion of
the purchase price of any asset or for other financing or the right to
incur any such obligation; (2) a mortgage, security interest or other lien
has been granted in or otherwise encumbers any property of a Company (or
an agreement exists relating to any future grant or encumbrance of a
mortgage, security interest or other lien on property of a Company); or
(3) a Company or any of a Company's property is bound and which, if
terminated, canceled or breached, would, in each case, have a material
adverse effect on the financial condition, properties or business
operations of the Companies taken as a whole, and the same shall
specifically include, but not be limited to, each contract for the
purchase of cobalt or nickel metals, cobalt or nickel concentrates or any
derivative thereof by any Company and involving aggregate consideration
payable by any Company of Three Million Dollars ($3,000,000) or more in
any year and the Note Purchase Agreement;
MATURITY means, when used with reference to a Subject Loan, the date
(whether occurring by lapse of time, acceleration or otherwise) upon which
that Subject Loan is due:
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MAXIMUM OUTSTANDING AMOUNT means, at the end of any fiscal quarter or
other time period of reference, the dollar amount equal to the highest
outstanding principal amount of Revolving Loans of Borrower at any time
during such fiscal quarter or other time period of reference;
MOST RECENT 4A.04 FINANCIAL STATEMENTS means Borrower's most recent
financial statements that are referred to in subsection 4A.04:
NCB means National City Bank;
NET INCOME means net income as determined in accordance with GAAP, after
taxes and after extraordinary items, but without giving effect to any gain
resulting from any reappraisal or write-up of any asset;
NET OFFERING PROCEEDS means the proceeds of a public equity offering of
the Capital Stock of Borrower, net any transaction costs incurred in
connection therewith;
NOTE PURCHASE AGREEMENT means that certain Note Purchase Agreement dated
as of August 30, 1995, as amended by that certain Amendment to Note
Purchase Agreement, dated as of January 21, 1997, entered into between and
among the Borrower and the Noteholders;
NOTEHOLDERS means the Great-West Life and Annuity Insurance Company, The
Mutual Life Insurance Company of New York, and Nationwide Life Insurance
Company;
PENSION PLAN means a defined benefit plan (as defined in section 3(35) of
ERISA) of a Company and includes, without limitation, any such plan that
is a multi-employer plan (as defined in section 3(37) of ERISA) applicable
to any of the Companies' employees;
PERSON means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or partnership or other entity, or a
government or any political subdivision or agency thereof;
POST-REFINANCING AMOUNT means an amount equal to the sum of (a) the
Revolving Commitments as of the Refinancing Date (not taking into account
the Refinanced Amount) PLUS (b) the Refinanced Amount;
PR LOAN means a Subject Loan bearing interest in accordance with
subsection 2A.03 and 2C.04;
PRIME RATE means the fluctuating rate of interest which is publicly
announced from time to time by NCB at its principal place of business as
being its "Prime Rate" or "base rate" thereafter in effect, with each
change in the Prime Rate automatically, immediately and without notice
changing the fluctuating interest rate thereafter applicable hereunder, it
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being agreed that the Prime Rate is not necessarily the lowest rate of
interest then available from NCB on fluctuating rate loans;
PRIOR CREDIT AGREEMENT means the Amended and Restated Credit Agreement
among the Borrower, the Banks and NCB-Agent dated October 18, 1996,
pursuant to which the Banks agreed to make revolving loans to Borrower,
under certain terms and conditions, in an amount not to exceed One Hundred
Twenty Million Dollars ($120,000,000);
PROFORMA COVENANT COMPLIANCE means compliance by Borrower and its
Subsidiaries with the general financial standards contained in Section 3B
of this Agreement as of the time of the event in question and for the
following twelve (12) month period based upon the Projections delivered by
Borrower in contemplation of such event pursuant to subsection 3A.0l(f) if
the same are requested by a Bank and otherwise on Borrower's internally
generated and used projections;
PROJECTIONS shall have the meaning ascribed to that term in subsection
3A.01(f);
RATABLE and RATABLY mean in the proportion that the Subject Loan is
divided among the Banks as set forth in section 2;
REFINANCING means the payment in full of the aggregate outstanding
principal balance of the Term Loans on the Refinancing Date pursuant to
subsection 2A.02 with (a) Net Offering Proceeds, if any, and (b) proceeds
resulting from the increase in the outstanding aggregate principal balance
of the Revolving Loans in an amount equal to the Refinanced Amount;
REFINANCING DATE means the earlier to occur of (a) the date upon which the
Net Offering Proceeds are received by Borrower and simultaneously Ratably
applied to pay down the aggregate outstanding principal balance of the
Term Loans, (b) June 30, 1997, or (c) the occurrence of any Default Under
This Agreement;
REFINANCED AMOUNT means an amount equal to the sum of (a) One Hundred
Twenty Million Dollars ($120,000,000) less (b) the Net Offering Proceeds
in an amount of up to Sixty Million Dollars ($60,000,000) less (c) the
aggregate amount of any optional prepayments of the Term Loans made prior
to the Refinancing Date;
REFINANCING REVOLVING NOTE means a note executed and delivered by Borrower
in accordance with subsection 2C.0l hereof and being in the form and
substance of Exhibit C with the blanks appropriately filled;
REIMBURSEMENT AGREEMENT means a reimbursement agreement executed and
delivered by Borrower in respect of an Subject LC;
RELATED WRITING means any note, mortgage, security agreement, other lien
instrument, financial statement, audit report, notice, legal opinion,
Credit Request, officer's certificate
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or other writing of any kind which is delivered to Banks and NCB-Agent or
any thereof and which is relevant in any manner to this Agreement or any
other Related Writing and includes, without limitation, the Revolving
Notes, the Term Notes and the other writings referred to in sections 3A
and 4A;
REPORTABLE EVENT has the meaning ascribed thereto by ERISA other than any
event as to which the requirement of notification has been waived by
regulation;
REQUIRED BANKS means, at the time of reference, Banks owed or holding in
the aggregate at least 80% of the sum of (a) the then aggregate unpaid
principal amount of the Revolving Loans then outstanding, (b) the then
aggregate Revolving Commitments to the extent in excess of the aggregate
Revolving Loans then outstanding;
REVOLVING COMMITMENT means the commitment of a Bank to extend credit to
Borrower pursuant to sections 2B and 2C of this Agreement and upon the
terms, subject to the conditions and in accordance with the other
provisions of this Agreement;
REVOLVING LOAN means a loan obtained by Borrower pursuant to sections 2B
and 2C of this Agreement and evidenced by a Revolving Note:
REVOLVING NOTE means an Initial Revolving Note or a Refinancing Revolving
Note, as the case may be;
REVOLVING SERIES means a Series of Revolving Loans;
SELLER means SUSI Corporation, a Delaware corporation;
SERIES means a group of Subject Loans of a single Type made by the Banks
on a single date and as to which a single LIBOR Contract Period or other
interest period is in effect (i.e., any group of Subject Loans made by the
Banks of a different Type, or having a different LIBOR Contract Period or
other interest period (regardless of whether such LIBOR Contract Period or
other interest period commences on the same date as another LIBOR Contract
Period or other interest period), or made on a different date shall be
considered to comprise a different Series);
STOCKHOLDERS' EQUITY means, at any date, the excess of the net book value
(after deducting all applicable valuation reserves and without
consideration to any reappraisal or write-up of assets after December 31,
1995) of all of the assets of the Companies as at such date (i.e.,
including intangibles such as patents, costs of businesses over net assets
acquired, goodwill and treasury shares) over the consolidated Total
Liabilities of the Companies as at such date, as determined on a
consolidated basis in accordance with GAAP;
SUBJECT INDEBTEDNESS means, collectively, the principal of and interest on
the Revolving Loans and all fees and other liabilities, if any, incurred
by Borrower to Banks and NCB-Agent or any thereof pursuant to this
Agreement or any Related Writing;
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SUBJECT LC means a letter of credit issued by NCB pursuant to section 2E;
SUBJECT LOAN means a loan obtained by Borrower pursuant to this Agreement,
including, without limitation, a Term Loan or a Revolving Loan;
SUBJECT NOTE means a Revolving Note or a Term Note;
SUBORDINATED, as applied to any liability of Borrower, means a liability
which at the time in question is subordinated (by written instrument in
form and substance satisfactory to the Required Banks) first in favor of
the prior payment in full of the Subject Indebtedness and then, subject to
the prior payment in full of the Subject Indebtedness, in favor of the
prior payment in full of all of Borrower's other Debt, if any, to the
Banks and NCB-Agent or any thereof;
SUBSIDIARY means a corporation or other business entity if shares
constituting a majority of its outstanding capital stock (or other form of
ownership) or constituting a majority of the voting power in any election
of directors (or shares constituting both majorities) are (or upon the
exercise of any outstanding warrants, options or other rights would be)
owned directly or indirectly at the time in question by the corporation in
question or another "Subsidiary" of that corporation or any combination of
the foregoing;
SUPPLEMENTAL SCHEDULE means the schedule incorporated into this Agreement
as EXHIBIT A;
TARGET means SCM Metal Products Inc., a Delaware corporation;
TERM LOAN means a loan obtained by Borrower pursuant to subsection 2A of
this Agreement and evidenced by a Term Note;
TERM NOTE means a note executed and delivered by Borrower and being in the
form and substance of EXHIBIT B with the blanks appropriately filled;
TERM SERIES means a Series of Term Loans;
TYPE means, when used in respect of any Subject Loan, the LIBOR Rate or
the Prime Rate in effect in respect of such Subject Loan.
TOTAL LIABILITIES means the aggregate (without duplication) of all
liabilities of the Companies in question and includes, but is not limited
to, (a) any indebtedness which is secured by any mortgage, security
interest or other lien on any of its property even if the full faith and
credit of it is not pledged to the payment thereof, (b) any indebtedness
for borrowed money or Funded Indebtedness if a Company is a Guarantor
thereof and (c) any Subordinated indebtedness;
the foregoing definitions shall be applicable to the respective plurals of
the foregoing defined terms.
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10. EXECUTION -- This Agreement may be executed in one or more counterparts,
each counterpart to be executed by Borrower, by NCB-Agent and by one or more
or all of the Banks. Each such executed counterpart shall be deemed to be an
executed original for all purposes but all such counterparts taken together
shall constitute but one agreement, which agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter
hereof.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Printed Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: Chief Financial Officer
--------------------------------------
Address: NATIONAL CITY BANK
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Attn: Metro/Ohio Division
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy: 216/575-9396 -----------------------------------------
Printed Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Title: Vice President
--------------------------------------
Address: NATIONAL CITY BANK, as Agent
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Attn: Metro/Ohio Division
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy: 216/575-9396 -----------------------------------------
Printed Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
Title: Vice President
--------------------------------------
Address: ABN AMRO BANK N.V.
▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Printed Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Title: Assistant Vice President and Controller
--------------------------------------
And by: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------
Printed Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------
Title: Financial Control Officer
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Address: MELLON BANK, N.A.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇,▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Printed Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Title: Vice President
-----------------------------------
Address: KEYBANK NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Printed Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Title: Vice President
-----------------------------------
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SUPPLEMENTAL SCHEDULE
There is no item which Borrower must disclose in this Supplemental Schedule in
order to be in full compliance with subsections 3D.01, 3D.02, 3D.03 and 3D.04,
nor is there any addition or exception to the representations and warranties
in section 4B.
EXHIBIT A
71
TERM NOTE
---------
$___________ Cleveland, Ohio, January ___, 1997
FOR VALUE RECEIVED, the undersigned, OM GROUP, INC. ("Borrower"), a Delaware
corporation, promises to pay to the order of_________________________ at the
main office of National City Bank ("NCB") in Cleveland, Ohio, the principal
sum of
____________ DOLLARS
(or if less, the aggregate unpaid principal balance from time to time shown on
the reverse side hereof or entered in a loan account on payee's books and
records, or both), together with interest computed thereon in accordance with
the Credit Agreement referred to below, which principal and interest is
payable in accordance with the provisions in the Credit Agreement.
This note is issued pursuant to a certain Second Amended and Restated Credit
Agreement (the "Credit Agreement") made as of January ___, 1997 between and
among the payee, Borrower and NCB (for itself and as agent of the banks
therein). The Credit Agreement establishes "Term Series" (one by each bank)
aggregating up to One Hundred Twenty Million Dollars ($120,000,000) pursuant
to which Borrower may obtain Term Loans from Banks upon terms and conditions
specified therein. The Credit Agreement contains definitions applicable to
this note, provisions governing the making of loans, the acceleration of the
maturity thereof, rights of prepayment and other provisions applicable to this
note. Each endorsement, if any, on the reverse side of this note (or any
allonge thereto) shall be prima facie evidence of the data so endorsed.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By:____________________________________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Printed Name:__________________________
Title: ________________________________
EXHIBIT B
72
REVOLVING NOTE
--------------
$___________ Cleveland, Ohio, January ___, 1997
FOR VALUE RECEIVED, the undersigned, OM GROUP, INC. ("Borrower"), a Delaware
corporation, promises to pay to the order of_________________________ at the
main office of National City Bank ("NCB") in Cleveland, Ohio, the principal
sum of
_____________________ DOLLARS
(or if less, the aggregate unpaid principal balance from time to time shown on
the reverse side hereof or entered in a loan account on payee's books and
records, or both), together with interest computed thereon in accordance with
the Credit Agreement referred to below, which principal and interest is
payable in accordance with the provisions in the Credit Agreement.
This note is issued pursuant to a certain Second Amended and Restated Credit
Agreement (the "Credit Agreement") made as of January ___, 1997 between and
among the payee, Borrower and NCB (for itself and as agent of the banks
therein). The Credit Agreement establishes "Revolving Commitments" (one by
each Bank) aggregating up to Two Hundred Forty Million Dollars ($240,000,000)
pursuant to which Borrower may obtain Revolving Loans from Banks upon terms
and conditions specified therein. The Credit Agreement contains definitions
applicable to this note, provisions governing the making of loans, the
acceleration of the maturity thereof, rights of prepayment, activation and
inactivation of portions of the Revolving Commitments and other provisions
applicable to this note. Each endorsement, if any, on the reverse side of this
note (or any allonge thereto) shall be prima facie evidence of the data so
endorsed.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: ________________________________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Printed Name: ______________________
Title: ______________________________
EXHIBIT C
73
EXTENSION AGREEMENT
-------------------
Cleveland, Ohio
_____________, 1997
National City Bank
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Attn: Metro/Ohio Division
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
ABN AMRO Bank ▇.▇.
▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
KeyBank National Association
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Mellon Bank, N.A.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Subject: Extension of Revolving Commitments under Second Amended and
Restated Credit Agreement dated January ___, 1997
Greetings:
Reference is made to the Second Amended and Restated Credit Agreement by and
among you, the undersigned ("Borrower") and National City Bank as your agent
which provided for, among other things, Revolving Commitments aggregating up
to $240,000,000 and available to Borrower, upon certain terms and conditions,
on a revolving basis until January 31, 2002, (the "Expiration Date" now in
effect) subject, however, to earlier reduction or termination as well as
specific conditions regarding activation and inactivation or portions of the
Revolving Commitment, in each case pursuant to the Credit Agreement.
Borrower hereby requests that the Credit Agreement be amended by deleting the
date "_____________________" from subsection 2B.02 (captioned "Expiration")
and by substituting for that deleted date the date "_______________________."
In all other respects the Credit Agreement shall remain in full effect.
74
This letter has been executed and delivered to each of you in triplicate. If
you assent to the extension, kindly send or deliver two signed copies of your
assent to National City Bank as you agent who will, if the extension becomes
effective, forward one such copy to Borrower and inform you of the extension.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: _____________________________________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Printed Name: ___________________________
Title: __________________________________
The undersigned hereby assent to the foregoing.
NATIONAL CITY BANK ABN AMRO BANK, N.V.
By: _______________________________ By: _____________________________________
Printed Name: _____________________ Printed Name: ___________________________
Title: ____________________________ Title: __________________________________
KEYBANK NATIONAL ASSOCIATION MELLON BANK, N.A.
By: _______________________________ By: _____________________________________
Printed Name: _____________________ Printed Name: ___________________________
Title: ____________________________ Title: __________________________________
EXHIBIT D
75
CREDIT REQUEST
Cleveland, Ohio
____________, 1997
TO: National City Bank, as Agent
SUBJECT: Second Amended and Restated Credit Agreement dated January ___, 1997
between and among OM Group, Inc., National City Bank, ABN AMRO Bank
N.V., KeyBank National Association, Mellon Bank, N.A. and National City
Bank as Agent
Gentlemen:
Each term in this Credit Request shall be defined in accordance with the
subject Credit Agreement. Pursuant to subsection 2C.02 of the Credit
Agreement, we request
( ) the Banks to grant us a Series of PR Loans in the aggregate
principal sum of $_______ to be made available to us on the __th day
of__________, _______.
( ) the Banks to grant us a Series of LIBOR Loans in the aggregate
principal sum of $__________ to be made available to us on the ___th
day of ___________, ____ and to have an interest period ending ______
months thereafter,
and disburse the proceeds as follows:_________________________________________
___________________________________________________.
The proceeds will be used for the benefit of__________________ [insert name of
company] for the purpose of __________________.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: ________________________________________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Printed Name: ______________________________
Title: _____________________________________
EXHIBIT E
76
CONTINUATION/CONVERSION REQUEST
-------------------------------
TO: National City Bank, as Agent
Subject: Second Amended and Restated Credit Agreement dated January ___, 1997
between and among OM Group, Inc., National City Bank, ABN SMRO Bank
N.V., KeyBank National Association, Mellon Bank, N.A. and National
City Bank as Agent
Gentlemen:
Each term in this Continuation/Conversion Request shall be defined in
accordance with the subject Credit Agreement. Pursuant to subsection 2D.07 of
the Credit Agreement, we request
( ) to convert Term Series comprised of LIBOR Loans in the principal amount of
_____________ to a Term Series comprised of PR Loans.
( ) to convert Term Series comprised of PR Loans in the principal amount
of _____________ to a Term Series comprised of LIBOR Loans.
( ) to continue Term Series comprised of LIBOR Loans in the principal amount of
____________ as another Term Series comprised of LIBOR Loans.
This Continuation/Conversion Request is executed and delivered to NCB-Agent as
of this _____th day of _____________,______.
Address: OM GROUP, INC.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ By: ______________________________________
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Printed Name: ____________________________
Title: ___________________________________
EXHIBIT F
77
LIST OF SUBSIDIARIES
--------------------
Legal Name Address of Chief Jurisdiction Equity
---------- ---------------- ------------ ------
of Subsidiary Executive Office Where Incorporated Ownership
------------- ---------------- ------------------ ---------
D&O Incorporated ▇-▇ ▇▇▇▇▇ ▇-▇▇▇▇▇ ▇▇▇▇▇ ▇▇%
▇▇▇▇-▇▇
▇▇▇▇▇, ▇▇▇▇▇
OMO KoKKola P0 Box 26 Finland 100%
Chemicals, Oy SF - 67101
Kokkola, Finland
OMG Americas, Inc. ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇-▇▇▇▇ ▇▇▇%
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
OMG ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ 100%
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
OMG ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇, ▇▇ ▇▇▇▇▇▇ ▇▇▇%
Co., Ltd. ▇▇▇ ▇▇▇ ▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, R.O.C.
Vasset, S.A. ▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 100%
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
J & 0, Inc. (Chusuk Hoesa J & 0) Korea 50%
#2-3, Jook Gok Ri Korea
▇▇▇ ▇▇▇▇▇ Eub
▇▇▇ ▇▇▇ City
▇▇▇▇▇ ▇▇▇, Korea
EXHIBIT G
78
OMG Apex, Inc. ▇.▇. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇%
▇▇. ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SCM Metal Products Inc. ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Delaware 100%
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
SCM Metal Products ▇▇, ▇▇▇▇▇▇▇▇ ▇▇. ▇▇-▇▇ ▇▇▇▇▇▇▇▇▇ 70%
Singapore Pte. Ltd ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
EXHIBIT G
