Exhibit 10.1
$150,000,000
SECURED SUPER-PRIORITY DEBTOR IN POSSESSION
REVOLVING CREDIT AGREEMENT
Dated as of January 31, 2005
among
XXXXXXXX'X INC.,
A DEBTOR AND DEBTOR IN POSSESSION,
as Borrower
and
THE SUBSIDIARIES OF THE BORROWER PARTY HERETO,
EACH, A DEBTOR AND DEBTOR IN POSSESSION,
as Subsidiary Guarantors
and
THE LENDERS AND ISSUERS PARTY HERETO
and
CITICORP USA, INC.,
as Administrative Agent
* * *
CITIGROUP GLOBAL MARKETS INC.,
as Sole Lead Arranger and Sole Book Runner
WEIL, GOTSHAL & XXXXXX LLP
000 XXXXX XXXXXX
XXX XXXX, XXX XXXX 00000-0000
SECURED SUPER-PRIORITY DEBTOR IN POSSESSION REVOLVING CREDIT
AGREEMENT, dated as of January 31, 2005, among XXXXXXXX'X INC., a Delaware
corporation and a debtor and debtor in possession under chapter 11 of the
Bankruptcy Code (as defined below) (the "Borrower"), the Subsidiaries (as
defined below) of the Borrower listed on the signature pages hereof, each, a
debtor and debtor in possession under chapter 11 of the Bankruptcy Code, as
Subsidiary Guarantors (the "Subsidiary Guarantors"), the Lenders (as defined
below), the Issuers (as defined below) and CITICORP USA, INC. ("Citicorp"), as
administrative agent for the Lenders and the Issuers (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, on January 14, 2005 (the "Petition Date"), the Borrower and
the Subsidiary Guarantors each filed a voluntary petition for relief
(collectively, the "Cases") under chapter 11 of the Bankruptcy Code with the
United States Bankruptcy Court for the Southern District of Georgia (the
"Bankruptcy Court"); and
WHEREAS, the Borrower and the Subsidiary Guarantors are continuing to
operate their respective businesses and manage their respective properties as
debtors in possession under sections 1107 and 1108 of the Bankruptcy Code; and
WHEREAS, the Borrower has requested that the Lenders and the Issuers
provide a secured super-priority revolving credit and letter of credit
facility of up to $150,000,000 in order to fund the continued operation of the
Borrower's and the Subsidiary Guarantors' businesses as debtors and debtors in
possession under the Bankruptcy Code; and
WHEREAS, the Lenders and the Issuers are willing to make available to
the Borrower such post-petition loans and other extensions of credit upon the
terms and subject to the conditions set forth herein; and
WHEREAS, each of the Subsidiary Guarantors has agreed to guaranty the
obligations of the Borrower hereunder and each of the Borrower and the
Subsidiary Guarantors has agreed to secure its obligations to the Lenders and
the Issuers hereunder with, inter alia, security interests in, and liens on,
all of its property and assets, whether real or personal, tangible or
intangible, now existing or hereafter acquired or arising, all as more fully
provided herein;
NOW, THEREFORE, in consideration of the premises and the covenants
and agreements contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS, INTERPRETATION AND ACCOUNTING TERMS
Section 1.1. Defined Terms. As used in this Agreement, the following
terms have the following meanings (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):
"Account" has the meaning given to such term in the UCC.
"Account Debtor" has the meaning given to such term in the UCC.
1
"Additional Pledged Collateral" means all shares of, limited and/or
general partnership interests in, and limited liability company interests in,
and all securities convertible into, and warrants, options and other rights to
purchase or otherwise acquire, stock of, either (i) any Person that, after the
date of this Agreement, as a result of any occurrence, becomes a direct
Subsidiary of any Loan Party or (ii) any issuer of Pledged Stock, any
Partnership or any LLC that are acquired by any Loan Party after the date
hereof; all certificates or other instruments representing any of the
foregoing; all Security Entitlements of any Loan Party in respect of any of
the foregoing; all additional indebtedness from time to time owed to any Loan
Party by any obligor on the Pledged Notes and the instruments evidencing such
indebtedness; and all interest, cash, instruments and other property or
Proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the foregoing. Additional Pledged
Collateral may be General Intangibles or Investment Property.
"Affected Lender" has the meaning specified in Section 2.17
(Substitution of Lenders).
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling or that is controlled by or is under common
control with such Person, each officer, director, general partner or
joint-venturer of such Person, and each Person that is the beneficial owner of
10% or more of any class of Voting Stock of such Person. For the purposes of
this definition, "control" means the possession of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent Affiliate" has the meaning specified in Section 12.3(c)
(Posting of Approved Electronic Communications).
"Agreement" means this Secured Super-Priority Debtor In Possession
Revolving Credit Agreement.
"Applicable Lending Office" means, with respect to each Revolving
Credit Lender, its Domestic Lending Office in the case of a Base Rate Loan,
and its Eurodollar Lending Office in the case of a Eurodollar Rate Loan.
"Applicable Margin" means, with respect to (i) Revolving Loans and
Swing Loans maintained as Base Rate Loans, prior to the Incremental Facility
Effective Date, a rate equal to 1.25% per annum and on and after the
Incremental Facility Effective Date, a rate equal to 1.50% per annum and (ii)
Revolving Loans maintained as Eurodollar Rate Loans, prior to the Incremental
Facility Effective Date, a rate equal to 2.25% per annum and on and after the
Incremental Facility Effective Date, a rate equal to 2.50% per annum.
"Applicable Unused Commitment Fee Rate" means 0.375% per annum.
"Approved Deposit Account" means a Deposit Account that is the
subject of an effective Deposit Account Control Agreement and that is
maintained by any Loan Party with a Deposit Account Bank. "Approved Deposit
Account" includes all monies on deposit in any such Deposit Account and all
certificates and instruments, if any, representing or evidencing such Deposit
Account.
"Approved Electronic Communications" means each notice, demand,
communication, information, document and other material that any Loan Party is
obligated to, or otherwise chooses to, provide to the Administrative Agent
2
pursuant to any Loan Document or the transactions contemplated therein,
including (a) any joinder to this Agreement and any other written Contractual
Obligation delivered or required to be delivered in respect of any Loan
Document or the transactions contemplated therein and (b) any Financial
Statement, financial and other report, notice, request, certificate and other
information material; provided, however, that, "Approved Electronic
Communication" shall exclude (x) any Notice of Borrowing, Letter of Credit
Request, Swing Loan Request, Notice of Conversion or Continuation, and any
other notice, demand, communication, information, document and other material
relating to a request for a new, or a conversion of an existing, Borrowing,
(ii) any notice pursuant to Section 2.8 (Optional Prepayments) and Section 2.9
(Mandatory Prepayments) and any other notice relating to the payment of any
principal or other amount due under any Loan Document prior to the scheduled
date therefor, (iii) all notices of any Default or Event of Default and (iv)
any notice, demand, communication, information, document and other material
required to be delivered to satisfy any of the conditions set forth in Article
III (Conditions To Loans And Letters Of Credit) or Section 2.4(a) (Letters of
Credit) or any other condition to any Borrowing or other extension of credit
hereunder or any condition precedent to the effectiveness of this Agreement.
"Approved Electronic Platform" has the meaning specified in Section
12.3(a) (Posting of Approved Electronic Communications).
"Approved Fund" means any Fund that is advised or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or Affiliate of an
entity that administers or manages a Lender.
"Approved Securities Intermediary" means a Securities Intermediary or
Commodity Intermediary selected or approved by the Administrative Agent.
"Arranger" means Citigroup Global Markets Inc., in its capacity as
sole lead arranger and sole book runner.
"Asset Sale" has the meaning specified in Section 8.4 (Sale of
Assets).
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Revolving Credit Lender and an Eligible Assignee, and
accepted by the Administrative Agent, in substantially the form of Exhibit A
(Form of Assignment and Acceptance).
"Availability Reserve" means, at any time the sum of: (a) the
Carve-Out, (b) the amount of all adequate protection payments which are then
due or will become due within the next fiscal month and (c) as of three
Business Days after the date of written notice of any determination thereof to
the Borrower by the Administrative Agent, such amounts as the Administrative
Agent may from time to time establish against the Facility (to the extent not
reflected in the calculation of the Borrowing Base), in the Administrative
Agent's sole discretion exercised reasonably and in accordance with customary
business practices for its comparable asset based transactions, in order
either (i) to reserve for the payment of items necessary or desirable to
preserve the value of the Collateral or the Administrative Agent's Lien
thereon or (ii) to provide for the payment of unanticipated liabilities of any
of the Loan Parties arising after the Closing Date.
"Available Credit" means, at any time, (a) the lesser of (i) the then
effective Revolving Credit Commitments and (ii) the Borrowing Base at such
time, minus (b) the sum of (i) the aggregate Revolving Credit Outstandings at
such time and (ii) the Availability Reserve in effect at such time.
3
"Avoidance Action" means all actions for preferences, fraudulent
conveyances, and other avoidance power claims and any recoveries under clause
(b) of Section 552, clause (c) of Section 506 and Sections 542, 544, 545, 547,
548, 549, 550 and 553 of the Bankruptcy Code, and all monies and other
property of any kind received therefrom.
"Bailee's Letter" means a letter in form and substance reasonably
acceptable to the Administrative Agent and executed by any Person (other than
a Loan Party) that is in possession of Inventory on behalf of a Loan Party
pursuant to which such Person acknowledges, among other things, the
Administrative Agent's Lien with respect thereto.
"Bankruptcy Code" means title 11, United States Code.
"Bankruptcy Court" is defined in the recitals to this Agreement or
shall mean any other court having competent jurisdiction over the Cases.
"Base Rate" means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time, which rate per annum shall be
equal at all times to the highest of the following:
(a) the rate of interest announced publicly by Citibank in New York,
New York, from time to time, as Citibank's base rate;
(b) the sum (adjusted to the nearest 0.25% or, if there is no nearest
0.25%, to the next higher 0.25%) of (i) 0.5% per annum, (ii) the rate per
annum obtained by dividing (A) the latest three-week moving average of
secondary market morning offering rates in the United States for
three-month certificates of deposit of major United States money market
banks, such three-week moving average being determined weekly on each
Monday (or, if any such day is not a Business Day, on the next succeeding
Business Day) for the three-week period ending on the previous Friday by
Citibank on the basis of such rates reported by certificate of deposit
dealers to and published by the Federal Reserve Bank of New York or, if
such publication shall be suspended or terminated, on the basis of
quotations for such rates received by Citibank from three New York
certificate of deposit dealers of recognized standing selected by
Citibank, by (B) a percentage equal to 100% minus the average of the
daily percentages specified during such three-week period by the Federal
Reserve Board for determining the maximum reserve requirement (including
any emergency, supplemental or other marginal reserve requirement) for
Citibank in respect of liabilities consisting of or including (among
other liabilities) three-month U.S. dollar nonpersonal time deposits in
the United States, and (iii) the average during such three-week period of
the maximum annual assessment rates estimated by Citibank for determining
the then current annual assessment payable by Citibank to the Federal
Deposit Insurance Corporation (or any successor) for insuring Dollar
deposits in the United States; and
(c) 0.5% per annum plus the Federal Funds Rate.
"Base Rate Loan" means any Swing Loan or any other Loan during any
period in which it bears interest based on the Base Rate.
4
"Blockage Notice" has the meaning specified in each Deposit Account
Control Agreement.
"Borrower" has the meaning specified in the preamble to this
Agreement.
"Borrowing" means a borrowing consisting of Revolving Loans made on
the same day by the Revolving Credit Lenders ratably according to their
respective Revolving Credit Commitments.
"Borrowing Base" means, at any time, subject to any Eligibility
Reserve then in effect, the sum of (a) the lesser of (i) up to 42.5% of the
Net Balance of the Loan Parties' Eligible Installment Contracts and (ii) up to
85.0% of the Net Orderly Liquidation Value of the Loan Parties' Eligible
Installment Contracts; provided, however, that, for the purposes of
calculation of the "Borrowing Base", in no event shall the Net Orderly
Liquidation Value of the Loan Parties' Eligible Installment Contracts be
deemed to be greater than 40.0% of the Net Balance of such Installment
Contracts, and (b) the lesser of (i) up to 52.5% of Eligible Inventory, and
(ii) up to 85.0% of the Net Orderly Liquidation Value of the Loan Parties'
Inventory; provided, however, that, for the purposes of calculation of the
"Borrowing Base", in no event shall the Net Orderly Liquidation Value of the
Loan Parties' Eligible Inventory be deemed to be greater than 65.0% of such
Eligible Inventory, minus any Borrowing Base Reserve in effect as such time;
provided, however, that prior to the earlier of (A) the date of delivery of
the appraisals referred to in Section 6.11(b)(i) and (B) the Incremental
Facility Effective Date, the Net Orderly Liquidation Value of Installment
Contracts and Inventory shall be determined by the Borrower based upon the
most recent information available to it, which information shall be in form
and substance satisfactory to the Administrative Agent.
"Borrowing Base Certificate" means a certificate of the Borrower
substantially in the form of Exhibit F (Form of Borrowing Base Certificate).
"Borrowing Base Reserve" means, at any time, as of three Business
Days after the date of written notice of any determination thereof to the
Borrower by the Administrative Agent, such amounts as the Administrative Agent
may from time to time establish against the Borrowing Base, in the
Administrative Agent's sole discretion exercised reasonably and in accordance
with customary business practices for its comparable asset based transactions,
in order to address an impairment of the value of the Collateral in the
Borrowing Base or an impairment of the Administrative Agent's Lien thereon,
including in any event the following: (a) a reserve reflecting amounts
required to pay any expenses related to third party financing of liquidation
sales as determined by a third party appraiser satisfactory to the
Administrative Agent to the extent not reflected in the calculation of the Net
Orderly Liquidation Value of the relevant Collateral, (b) a reserve for the
consignment of goods purchased but not paid for unless the consignor thereof
has agreed in writing in form and substance satisfactory to the Administrative
Agent that such goods will be treated as owned by the applicable Loan Party
and that such goods and the proceeds thereof are not subject to any Lien in
favor of such consignor or claim of ownership by such consignor and (c) a
reserve for the Loan Parties' gift certificate and layaway programs.
"Business Day" means a day of the year on which banks are not
required or authorized to close in New York City and, if the applicable
Business Day relates to notices, determinations, fundings and payments in
connection with the Eurodollar Rate or any Eurodollar Rate Loans, a day on
which dealings in Dollar deposits are also carried on in the London interbank
market.
5
"Capital Expenditures" means, for any Person for any period, the
aggregate of amounts that would be reflected as additions to property, plant
or equipment on a Consolidated balance sheet of such Person and its
Subsidiaries, excluding interest capitalized during construction.
"Capital Lease" means, with respect to any Person, any lease of, or
other arrangement conveying the right to use, property by such Person as
lessee that would be accounted for as a capital lease on a balance sheet of
such Person prepared in conformity with GAAP.
"Capital Lease Obligations" means, with respect to any Person, the
capitalized amount of all Consolidated obligations of such Person or any of
its Subsidiaries under Capital Leases.
"Carve-Out" means claims of the following parties for the following
amounts: (i) the unpaid fees of the U.S. Trustee or the Clerk of the
Bankruptcy Court pursuant to 28 U.S.C. ss. 1930(a) and (ii) the aggregate
allowed unpaid fees and expenses payable under sections 330 and 331 of the
Bankruptcy Code to professional persons retained pursuant to an order of the
Bankruptcy Court by the Borrower, any Subsidiary Guarantor or any Committee
not to exceed $3,000,000 in the aggregate; provided, however, that the
Carve-Out shall not include, apply to or be available for any fees or expenses
incurred by any party, including the Borrower, any Subsidiary Guarantor or any
Committee, in connection with the investigation (including discovery
proceedings), initiation or prosecution of any claims, causes of action,
adversary proceedings or other litigation against the Administrative Agent,
the Lenders or the Issuers in their respective capacities as such, including
challenging the amount, validity, perfection, priority or enforceability of or
asserting any defense, counterclaim or offset to, the obligations under the
Facility or the security interests and Liens of the Administrative Agent in
respect thereof; and provided further, however, that (a) as long as no Event
of Default shall have occurred and be continuing, the Borrower and each
Subsidiary Guarantor shall be permitted to pay compensation and reimbursement
of expenses allowed and payable under sections 330 and 331 of the Bankruptcy
Code, as the same may be due and payable, and (b) professionals shall be able
to apply retainers received by them prior to the Petition Date to their fees
and expenses which are due and payable, and in each case, the same shall not
reduce the Carve-Out.
"Cash Collateral Account" means the Cash Concentration Account and
any other Deposit Account or Securities Account that is (a) established by the
Administrative Agent from time to time in its sole discretion to receive cash
and Cash Equivalents (or purchase cash or Cash Equivalents with funds
received) from the Loan Parties or their Subsidiaries or Affiliates or Persons
acting on their behalf pursuant to the Loan Documents, (b) with such
depositaries and securities intermediaries as the Administrative Agent may
determine in its sole discretion, (c) in the name of the Administrative Agent
(although such account may also have words referring to the Borrower and the
account's purpose), (d) under the sole dominion and control of the
Administrative Agent and (e) in the case of a Securities Account, with respect
to which the Administrative Agent shall be the Entitlement Holder and the only
Person authorized to give Entitlement Orders with respect thereto.
"Cash Concentration Account" means the deposit account no. 3059-0515
at Citibank, designated as "CUSA F/A/X XXXXXXXX'X INC. CONCENTRATION A/C",
which account shall be under the sole dominion and control of the
Administrative Agent.
6
"Cash Equivalents" means (a) securities issued or fully guaranteed or
insured by the United States federal government or any agency thereof, (b)
certificates of deposit, eurodollar time deposits, overnight bank deposits and
bankers' acceptances of any commercial bank organized under the laws of the
United States, any state thereof, the District of Columbia, any foreign bank,
or its branches or agencies (fully protected against currency fluctuations)
that, at the time of acquisition, are rated at least "A-1" by S&P or "P-1" by
Xxxxx'x, (c) commercial paper of an issuer rated at least "A-1" by S&P or
"P-1" by Xxxxx'x and (d) shares of any money market fund that (i) has at least
95% of its assets invested continuously in the types of investments referred
to in clauses (a), (b) and (c) above, (ii) has net assets whose Dollar
Equivalent exceeds $500,000,000 and (iii) is rated at least "A-1" by S&P or
"P-1" by Xxxxx'x; provided, however, that the maturities of all obligations of
the type specified in clauses (a), (b) and (c) above shall not exceed 180
days.
"Cash Management Document" means any certificate, agreement or other
document executed by any Loan Party in respect of the Cash Management
Obligations of any Loan Party.
"Cash Management Obligation" means, as applied to any Person, any
direct or indirect liability, contingent or otherwise, of such Person in
respect of cash management services (including treasury, depository,
overdraft, credit or debit card, electronic funds transfer and other cash
management arrangements) provided after the date hereof (regardless of whether
these or similar services were provided prior to the date hereof by the
Administrative Agent, any Lender or any Affiliate of any of them) by the
Administrative Agent, any Lender or any Affiliate of any of them, including
obligations for the payment of fees, interest, charges, expenses, attorneys'
fees and disbursements in connection therewith.
"Change of Control" means the occurrence of any of the following: (a)
any person or group of persons (within the meaning of the Securities Exchange
Act of 1934, as amended) (other than Xxxxxx Ean Xxxxx or any of his
Affiliates) shall have acquired beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended) of Voting Stock of the Borrower in an amount
sufficient to elect a majority of the Borrower's board of directors or (b)
during any period of twelve consecutive calendar months occurring after the
date hereof, individuals who, at the beginning of such period, constituted the
board of directors of the Borrower (together with any new directors whose
election by the board of directors of the Borrower or whose nomination for
election by the stockholders of the Borrower was approved by a vote of at
least two-thirds of the directors then still in office who either were
directors at the beginning of such period or whose elections or nomination for
election was previously so approved) cease for any reason other than death or
disability to constitute a majority of the directors then in office.
"Chattel Paper" has the meaning given to such term in the UCC.
"Chief Executive Office" means the Borrower's headquarters located at
000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxx, Xxxxxxx.
"Citibank" means Citibank, N.A., a national banking association.
"Citicorp" has the meaning specified in the preamble to this
Agreement.
"Claim" has the meaning given to such term in Section 101(5) of the
Bankruptcy Code.
7
"Closing Date" means the first date on which any Loan is made or any
Letter of Credit is Issued.
"Code" means the Internal Revenue Code of 1986.
"Collateral" has the meaning specified in Section 11.1.
"Collateral Documents" means this Agreement, any Deposit Account
Control Agreement, any Securities Account Control Agreement and any other
document executed and delivered by a Loan Party granting a Lien on any of its
property to secure payment of the Secured Obligations.
"Commercial Tort Claim" has the meaning given to such term in the
UCC.
"Committee" means the official statutory committee of unsecured
creditors approved in the Cases pursuant to section 1102 of the Bankruptcy
Code.
"Commodity Account" has the meaning given to such term in the UCC.
"Commodity Intermediary" has the meaning given to such term in the
UCC.
"Compliance Certificate" has the meaning specified in Section 6.1(c)
(Financial Statements).
"Consolidated" means, with respect to any Person, the consolidation
of accounts of such Person and its Subsidiaries in accordance with GAAP,
provided that in no event shall Crescent Jewelers, Inc. or any of its
Subsidiaries be considered a Subsidiary of the Borrower for purposes of this
definition (whether or not GAAP would require otherwise) unless the Borrower
acquires more than 50% of the Voting Stock of such Person.
"Consolidated Net Income" means, for any Person for any period, the
Consolidated net income (or loss) of such Person for such period; provided,
however, that (a) the net income of any other Person in which such Person or
one of its Subsidiaries has a joint interest with a third party (which
interest does not cause the net income of such other Person to be Consolidated
into the net income of such Person) shall be included only to the extent of
the amount of dividends or distributions paid to such Person or Subsidiary,
(b) the net income of any Subsidiary of such Person that is subject to any
restriction or limitation on the payment of dividends or the making of other
distributions shall be excluded to the extent of such restriction or
limitation, and (c) extraordinary gains and losses and any one-time increase
or decrease to net income that is required to be recorded because of the
adoption of new accounting policies, practices or standards required by GAAP
shall be excluded.
"Constituent Documents" means, with respect to any Person, (a) the
articles of incorporation, certificate of incorporation, constitution or
certificate of formation (or the equivalent organizational documents) of such
Person, (b) the by-laws or operating agreement (or the equivalent governing
documents) of such Person and (c) any document setting forth the manner of
election and duties of the directors or managing members of such Person (if
any) and the designation, amount or relative rights, limitations and
preferences of any class or series of such Person's Stock.
8
"Contaminant" means any material, substance or waste that is
classified, regulated or otherwise characterized under any Environmental Law
as hazardous, toxic, a contaminant or a pollutant or by other words of similar
meaning or regulatory effect, including any petroleum or petroleum-derived
substance or waste, asbestos and polychlorinated biphenyls.
"Contracts" has the meaning given to such term in the UCC.
"Contractual Obligation" of any Person means any obligation,
agreement, undertaking or similar provision of any Security issued by such
Person or of any agreement, undertaking, contract, lease, indenture, mortgage,
deed of trust or other instrument (excluding a Loan Document) to which such
Person is a party or by which it or any of its property is bound or to which
any of its property is subject.
"Control Account" means a Securities Account or Commodity Account
that is the subject of an effective Securities Account Control Agreement and
that is maintained by any Loan Party with an Approved Securities Intermediary.
"Control Account" includes all Financial Assets held in any such Securities
Account or a Commodity Account and all certificates and instruments, if any,
representing or evidencing the Financial Assets contained therein.
"Corporate Chart" means a corporate organizational chart, list or
other similar document in each case in form reasonably acceptable to the
Administrative Agent and setting forth, for each Person that is a Loan Party,
that is subject to Section 7.11 (Additional Collateral and Guaranties) or that
is a Subsidiary of any of them, (a) the full legal name of such Person (and
any trade name, fictitious name or other name such Person may have had or
operated under), (b) the jurisdiction of organization, the organizational
number (if any) and the tax identification number (if any) of such Person, (c)
the location of such Person's chief executive office (or sole place of
business) and (d) the number of shares of each class of such Person's Stock
authorized (if applicable), the number outstanding as of the date of delivery
and the number and percentage of such outstanding shares for each such class
owned (directly or indirectly) by any Loan Party or any Subsidiary of any of
them.
"Copyrights" means (a) all copyrights arising under the laws of the
United States, any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished, all
registrations and recordings thereof, and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any foreign counterparts thereof and (b)
the right to obtain all renewals thereof.
"Copyright Licenses" means any written agreement naming any Loan
Party as licensor or licensee granting any right under any Copyright,
including the grant of rights to copy, publicly perform, create derivative
works, manufacture, distribute, exploit and sell materials derived from any
Copyright.
"Crescent Party" has the meaning specified in Schedule 1.1.
"Customary Permitted Liens" means, with respect to any Person, any of
the following Liens:
9
(a) Liens with respect to the payment of taxes, assessments or
governmental charges in each case that are not yet due or that are being
contested in good faith by appropriate proceedings and with respect to
which adequate reserves or other appropriate provisions are being
maintained to the extent required by GAAP;
(b) deposits made (i) in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other
types of social security benefits or (ii) to secure the performance of
bids, tenders, sales, contracts (other than for the repayment of borrowed
money), utilities, leases, and surety, appeal, customs or performance
bonds and other similar obligations incurred in the ordinary course of
business;
(c) encumbrances arising by reason of zoning restrictions, easements,
licenses, reservations, covenants, rights-of-way, utility easements,
building restrictions and other similar encumbrances on the use of real
property not materially detracting from the value of such real property
or not materially interfering with the ordinary conduct of the business
conducted and proposed to be conducted at such real property;
(d) encumbrances arising under licenses or sub-licenses of
Intellectual Property in the ordinary course of business to the extent
such licenses or sub-licenses are permitted by Section 8.4(d);
(e) encumbrances arising under leases or subleases of real property
that do not, in the aggregate, materially detract from the value of such
real property or interfere with the ordinary conduct of the business
conducted and proposed to be conducted at such real property; and
(f) a lessor's or consignor's rights in and to personal property
leased or consigned to such Person in the ordinary course of such
Person's business other than through a Capital Lease, including financing
statements filed with respect thereto.
"Debt Issuance" means the incurrence of any Indebtedness by the
Borrower or any of its Subsidiaries (excluding any Indebtedness incurred in
accordance with Section 8.1).
"Default" means any event that with the passing of time or the giving
of notice or both, would become an Event of Default.
"Deposit Account" has the meaning given to such term in the UCC.
"Deposit Account Bank" means a financial institution selected or
approved by the Administrative Agent, such approval not to be unreasonably
withheld.
"Deposit Account Control Agreement" means a letter agreement,
substantially in the form of Exhibit K (Form of Deposit Account Control
Agreement) (with such changes as may be agreed to by the Administrative
Agent), executed by the applicable Loan Party, the Administrative Agent and
the relevant financial institution, or otherwise in form and substance
satisfactory to the Administrative Agent.
"Document" has the meaning given to such term in the UCC.
10
"Documentary Letter of Credit" means any Letter of Credit that is
drawable upon presentation of documents evidencing the sale or shipment of
goods purchased by the Borrower or any of its Subsidiaries in the ordinary
course of its business.
"Dollar Equivalent" of any amount means, at the time of determination
thereof, (a) if such amount is expressed in Dollars, such amount, (b) if such
amount is expressed in any lawful currency other than Dollars that is freely
transferable into Dollars, the equivalent of such amount in Dollars determined
by using the rate of exchange quoted by Citibank in New York, New York at
11:00 a.m. (New York time) on the date of determination (or, if such date is
not a Business Day, the last Business Day prior thereto) to prime banks in New
York for the spot purchase in the New York foreign exchange market of such
amount of Dollars with such currency and (c) if such amount is denominated in
any other currency, the equivalent of such amount in Dollars as determined by
the Administrative Agent using any method of determination it deems
appropriate.
"Dollars" and the sign "$" each mean the lawful money of the United
States of America.
"Domestic Lending Office" means, with respect to any Revolving Credit
Lender, the office of such Revolving Credit Lender specified as its "Domestic
Lending Office" opposite its name on Schedule II (Applicable Lending Offices
and Addresses for Notices) or on the Assignment and Acceptance by which it
became a Revolving Credit Lender or such other office of such Revolving Credit
Lender as such Revolving Credit Lender may from time to time specify to the
Borrower and the Administrative Agent.
"Domestic Person" means any "United States person" under and as
defined in Section 7701(a)(30) of the Code.
"Domestic Subsidiary" means any Subsidiary of the Borrower organized
under the laws of any state of the United States of America or the District of
Columbia.
"EBITDAR" means, with respect to any Person for any period, (a)
Consolidated Net Income of such Person for such period plus (b) the sum of, in
each case to the extent included in the calculation of such Consolidated Net
Income but without duplication, (i) any provision for income taxes, (ii)
interest expense, (iii) loss from extraordinary items, (iv) depreciation,
depletion and amortization expenses, (v) restructuring charges (including,
without limitation, professional fees and disbursements) incurred in
connection with the Cases, (vi) charges (including, without limitation,
professional fees and disbursements) in connection with (A) any investigation
or litigation commenced prior to the Petition Date, (B) any restatement of the
Borrower's Consolidated financial statements for any period ending prior to
the date hereof, (C) any restructuring of the credit department of the Loan
Parties or (D) any store closure program pursuant to Permitted Transactions,
(vii) other charges constituting restructuring charges under GAAP, (viii)
losses arising from the sale of any capital asset, (ix) losses arising from
any write-down in the book value of any asset, (x) non-cash charges incurred
in connection with or as part of any restatement of the Borrower's
Consolidated financial statements for any period ending prior to the date
hereof and (xi) all other non-cash charges and non-cash losses for such
period, including the amount of any compensation deduction as the result of
any grant of Stock or Stock Equivalents to employees, officers, directors or
consultants minus (c) the sum of, in each case to the extent included in the
calculation of such Consolidated Net Income but without duplication, (i) any
credit for income tax, (ii) interest income, (iii) gains from extraordinary
items for such period, (iv) any aggregate net gain (but not any aggregate net
loss) from the sale, exchange or other disposition of capital assets by such
11
Person and (v) any other non-cash gains or other items which have been added
in determining Consolidated Net Income, including any reversal of a charge
referred to in clause (b)(v) above by reason of a decrease in the value of any
Stock or Stock Equivalent.
"Effective Date" means the date upon which a plan of reorganization
in any of the Cases becomes effective.
"Eligibility Reserves" means, effective as of three Business Days
after the date of written notice of any determination thereof to the Borrower
by the Administrative Agent, such amounts as the Administrative Agent, in its
sole discretion exercised reasonably and in accordance with customary business
practices for its comparable asset based transactions, may from time to time
establish against the gross amounts of Eligible Installment Contracts and
Eligible Inventory, to reflect risks or contingencies arising after the
Closing Date which may affect any one or class of such items and which have
not already been taken into account in the calculation of the Borrowing Base.
"Eligible Assignee" means (a) a Lender or an Affiliate or Approved
Fund of any Lender; (b) a commercial bank having total assets whose Dollar
Equivalent exceeds $5,000,000,000; (c) a finance company, insurance company or
any other financial institution or Fund, in each case reasonably acceptable to
the Administrative Agent and regularly engaged in making, purchasing or
investing in loans, and having a net worth, determined in accordance with
GAAP, whose Dollar Equivalent exceeds $250,000,000 (or, to the extent net
worth is less than such amount, a finance company, insurance company, other
financial institution or Fund, reasonably acceptable to the Administrative
Agent and the Borrower); or (d) a savings and loan association or savings bank
organized under the laws of the United States or any State thereof having a
net worth, determined in accordance with GAAP, whose Dollar Equivalent exceeds
$250,000,000.
"Eligible Installment Contracts" means, for each Loan Party as of any
date of determination and without duplication, those Installment Contracts
which the Administrative Agent, in its sole discretion exercised reasonably
and in accordance with customary business practices for its comparable asset
based transactions, determines are eligible, but excluding, without limiting
the Administrative Agent's discretionary rights:
(a) any Installment Contract which is (i) not subject to a perfected,
first priority (subject only to the Carve-Out) Lien in favor of the
Administrative Agent to secure the Secured Obligations, (ii) subject to
any other Lien other than Liens securing Prepetition Secured
Indebtedness; provided, however, that, with respect to clause (ii) only,
all such Liens shall be on terms acceptable to the Administrative Agent,
including with respect to the subordination of all such Liens to the
Liens of the Administrative Agent, or (iii) evidences a transaction not
in compliance with any Requirement of Law;
(b) any Installment Contract for which payment thereunder is doubtful
or is determined to be uncollectible (including, without limitation, any
Installment Contract under which any payment is more than sixty (60) days
past due on a "contractual" basis);
(c) any Installment Contract which is modified or rewritten in any
respect materially adverse to such Loan Party or that impairs the value
thereof;
12
(d) any Installment Contract with a term of more than twenty-four
(24) months;
(e) any Installment Contract for which the obligations of the debtor
thereunder are evidenced by a note, Chattel Paper, or other Instrument,
unless the covenants set forth in this Agreement applicable to such note,
Chattel Paper or Instrument have been complied with;
(f) any Installment Contract for which the debtor thereunder is not
solvent or is subject to any bankruptcy or insolvency proceeding of any
kind or which has died or been declared judicially incompetent;
(g) any Installment Contract for which the debtor thereunder is
located outside of the United States (unless payment for the goods
shipped is secured by an irrevocable letter of credit in form and
substance and from an institution acceptable to the Administrative Agent
and with respect to which the letter-of-credit rights (as defined in the
UCC) have been assigned to the Administrative Agent pursuant to documents
in form and substance acceptable to the Administrative Agent;
(h) any Installment Contract which is contingent or which is subject
to offset, discount, or deduction (in each case to the extent of such
offset, discount, or deduction) or which is subject to any counterclaim,
dispute, or other defense to payment (in each case to the extent of such
counterclaim, dispute or other defense);
(i) any Installment Contract under which any Subsidiary, employee, or
Affiliate of a Loan Party is the debtor;
(j) any Installment Contract representing a sale to the government of
the United States or any subdivision thereof unless the Federal
Assignment of Claims Act (or other similar Requirement of Law) has been
complied with to the satisfaction of the Administrative Agent with
respect to such Installment Contract;
(k) any Installment Contract with respect to which any of the
representations, warranties, covenants, and agreements contained in the
Loan Documents are not or have ceased to be complete and correct or have
been breached;
(l) any Installment Contract which represents a sale on a
xxxx-and-hold, guaranteed sale, sale and return, sale on approval,
consignment, or other repurchase or return basis;
(m) any Installment Contract arising from a transaction which does
not conform to the credit criteria of a Loan Party in effect at the time
such Installment Contract is entered into;
(n) any Installment Contract owing from a debtor the Administrative
Agent reasonably determines is not creditworthy;
(o) any Installment Contract under which the initial payment is more
than forty-five (45) days from the original date of sale;
13
(p) any Installment Contract under which the merchandise purchased by
the debtor has been repossessed or a Loan Party has demanded return of
such merchandise;
(q) any Installment Contract arising in a transaction in which the
goods covered thereby have not been delivered;
(r) the portion of any sales tax included in any Installment
Contract;
(s) any Installment Contract which has payment terms which are not
fully amortizing within twenty-four (24) months after the date of sale
with respect thereto; and
(t) any Installment Contract which fails to meet such other
specifications and requirements as may from time to time be established
by the Administrarive Agent, on three Business Days' prior written notice
thereof to the Borrower, in its sole discretion exercised reasonably and
in accordance with customary business practices for its comparable asset
based transactions.
"Eligible Inventory" means, for each Loan Party as of any date of
determination and without duplication, the lower of the aggregate book value
(based on a FIFO or a moving average cost valuation, consistently applied) or
fair market value of finished goods Inventory owned by such Loan Party, less
reserves against Inventory shrinkage as are reasonably satisfactory to the
Administrative Agent and other appropriate reserves determined in accordance
with GAAP. Without limiting the foregoing, Eligible Inventory excludes in any
event:
(a) Inventory which is (i) not subject to a perfected, first priority
(subject only to the Carve-Out) Lien in favor of the Administrative Agent
to secure the Secured Obligations or (ii) subject to any other Lien other
than Liens securing Prepetition Secured Indebtedness; provided, however,
that, with respect to clause (ii) only, all such Liens shall be on terms
acceptable to the Administrative Agent, including with respect to the
subordination of all such Liens to the Liens of the Administrative Agent;
(b) Inventory which is defective, obsolete, or not in good or
merchantable condition or fails to meet standards for sale or use imposed
by governmental agencies, departments, or divisions having regulatory
authority over such goods;
(c) Inventory which is not useable or salable at prices approximating
its cost in the ordinary course of the business (including, without
duplication, the amount of any reserves for obsolescence, unsalability,
or decline in value);
(d) Inventory located outside of the United States or in transit
(other than between locations operated by the Loan Parties);
(e) Inventory which is leased or held on sale and return, sale on
approval, consignment, or other repurchase or return basis;
(f) Inventory that has been returned to a Loan Party unless such
Inventory meets all of the other requirements of eligibility contained
herein or repossessed by a Loan Party;
14
(g) Inventory that is located in a public warehouse or in possession
of a bailee or in a facility leased by a Loan Party unless (i) the Liens
and other rights of the applicable warehouseman, bailee, or lessor are
subject to the automatic stay or fully subordinated to the Administrative
Agent's Liens, (ii) the applicable warehouseman, bailee, or lessor shall
have delivered to the Administrative Agent a Bailee's Letter or Landlord
Waiver or (iii) a reserve shall have been established by the
Administrative Agent with respect thereto;
(h) Inventory that is not finished goods or is raw materials,
work-in-process, chemicals, samples, prototypes, supplies, or packing and
shipping materials;
(i) Inventory that is subject to a third party's trademark or other
proprietary right, unless the Administrative Agent is satisfied that it
could sell such Inventory on satisfactory terms during the existence of
an Event of Default;
(j) Inventory which is to be returned to any vendor;
(k) any capitalized costs included in Inventory; and
(l) Inventory which fails to meet such other specifications and
requirements as may from time to time be established by the
Administrative Agent on three Business Days' prior written notice thereof
to the Borrower, in its sole discretion exercised reasonably and in
accordance with customary business practices for its comparable asset
based transactions.
"Entitlement Holder" has the meaning given to such term in the UCC.
"Entitlement Order" has the meaning given to such term in the UCC.
"Environmental Laws" means all applicable Requirements of Law now or
hereafter in effect and as amended or supplemented from time to time, relating
to pollution or the regulation and protection of human or animal health,
safety, the environment or natural resources, including the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended
(42 U.S.C. ss. 9601 et seq.); the Hazardous Material Transportation Act, as
amended (49 U.S.C. ss. 5101 et seq.); the Federal Insecticide, Fungicide, and
Rodenticide Act, as amended (7 U.S.C. ss. 136 et seq.); the Resource
Conservation and Recovery Act, as amended (42 U.S.C. ss. 6901 et seq.); the
Toxic Substance Control Act, as amended (15 U.S.C. ss. 2601 et seq.); the
Clean Air Act, as amended (42 U.S.C. ss. 7401 et seq.); the Federal Water
Pollution Control Act, as amended (33 U.S.C. ss. 1251 et seq.); the
Occupational Safety and Health Act, as amended (29 U.S.C. ss. 651 et seq.);
the Safe Drinking Water Act, as amended (42 U.S.C. ss. 300f et seq.); and each
of their state and local counterparts or equivalents and any transfer of
ownership notification or approval statute, including the Industrial Site
Recovery Act (N.J. Stat. Xxx. ss. 13:1K-6 et seq.).
"Environmental Liabilities and Costs" means, with respect to any
Person, all liabilities, obligations, responsibilities, Remedial Actions,
losses, damages, punitive damages, consequential damages, treble damages,
costs and expenses (including all fees, disbursements and expenses of counsel,
experts and consultants and costs of investigation and feasibility studies),
fines, penalties, sanctions and interest incurred as a result of any claim or
demand by any other Person, whether based in contract, tort, implied or
express warranty, strict liability, criminal or civil statute and whether
arising under any Environmental Law, Permit, order or agreement with any
15
Governmental Authority or other Person, in each case relating to any
environmental, health or safety condition or to any Release or threatened
Release and resulting from the past, present or future operations of, or
ownership of property by, such Person or any of its Subsidiaries.
"Environmental Lien" means any Lien in favor of any Governmental
Authority for Environmental Liabilities and Costs.
"Equipment" has the meaning given to such term in the UCC.
"Equity Issuance" means the issue or sale of any Stock of the
Borrower or any Subsidiary of the Borrower by the Borrower or any Subsidiary
of the Borrower to any Person other than the Borrower or any Subsidiary of the
Borrower.
"Equity Cushion" has the meaning specified in the Orders.
"ERISA" means the United States Employee Retirement Income Security
Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control or treated as a single employer with the
Borrower or any of its Subsidiaries within the meaning of Section 414 (b),
(c), (m) or (o) of the Code.
"ERISA Event" means (a) a reportable event described in Section
4043(b) or 4043(c)(1), (2), (3), (5), (6), (8) or (9) of ERISA with respect to
a Title IV Plan or a Multiemployer Plan; (b) the withdrawal of the Borrower,
any of its Subsidiaries or any ERISA Affiliate from a Title IV Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (c) the complete or
partial withdrawal of the Borrower, any of its Subsidiaries or any ERISA
Affiliate from any Multiemployer Plan; (d) notice of reorganization or
insolvency of a Multiemployer Plan; (e) the filing of a notice of intent to
terminate a Title IV Plan or the treatment of a plan amendment as a
termination under Section 4041 of ERISA; (f) the institution of proceedings to
terminate a Title IV Plan or Multiemployer Plan by the PBGC; (g) the failure
to make any required contribution to a Title IV Plan or Multiemployer Plan;
(h) the imposition of a lien under Section 412 of the Code or Section 302 of
ERISA on the Borrower or any of its Subsidiaries or any ERISA Affiliate; or
(i) any other event or condition that might reasonably be expected to
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Title IV Plan or Multiemployer
Plan or the imposition of any liability under Title IV of ERISA, other than
for PBGC premiums due but not delinquent under Section 4007 of ERISA.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Federal Reserve Board.
"Eurodollar Base Rate" means, with respect to any Interest Period for
any Eurodollar Rate Loan, the rate determined by the Administrative Agent to
be the offered rate for deposits in Dollars for the applicable Interest Period
appearing on the Dow Xxxxx Markets Telerate Page 3750 as of 11:00 a.m., London
time, on the second full Business Day next preceding the first day of each
Interest Period. In the event that such rate does not appear on the Dow Xxxxx
Markets Telerate Page 3750 (or otherwise on the Dow Xxxxx Markets screen), the
Eurodollar Base Rate for the purposes of this definition shall be determined
by reference to such other comparable publicly available service for
displaying eurodollar rates as may be selected by the Administrative Agent,
or, in the absence of such availability, the Eurodollar Base Rate shall be the
16
rate of interest determined by the Administrative Agent to be the rate per
annum at which deposits in Dollars are offered by the principal office of
Citibank in London to major banks in the London interbank market at 11:00
a.m., London time, two Business Days before the first day of such Interest
Period in an amount substantially equal to the Eurodollar Rate Loan of
Citibank for a period equal to such Interest Period.
"Eurodollar Lending Office" means, with respect to any Revolving
Credit Lender, the office of such Revolving Credit Lender specified as its
"Eurodollar Lending Office" opposite its name on Schedule II (Applicable
Lending Offices and Addresses for Notices) or on the Assignment and Acceptance
by which it became a Revolving Credit Lender (or, if no such office is
specified, its Domestic Lending Office) or such other office of such Revolving
Credit Lender as such Revolving Credit Lender may from time to time specify to
the Borrower and the Administrative Agent.
"Eurodollar Rate" means, with respect to any Interest Period for any
Eurodollar Rate Loan, an interest rate per annum equal to the rate per annum
obtained by dividing (a) the Eurodollar Base Rate by (b) (i) a percentage
equal to 100% minus (ii) the reserve percentage applicable two Business Days
before the first day of such Interest Period under regulations issued from
time to time by the Federal Reserve Board for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal reserve
requirement) for a member bank of the Federal Reserve System in New York City
with respect to liabilities or assets consisting of or including Eurocurrency
Liabilities (or with respect to any other category of liabilities that
includes deposits by reference to which the Eurodollar Rate is determined)
having a term equal to such Interest Period.
"Eurodollar Rate Loan" means any Loan that, for an Interest Period,
bears interest based on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 9.1 (Events
of Default).
"Existing Collateral Agent" means Bank of America, N.A., in its
capacity as collateral agent under the Existing Credit Agreement, and its
successors and assigns.
"Existing Credit Agreement" means that certain Second Amended and
Restated Credit Agreement, dated as of September 7, 2004, among the Borrower,
certain of its Subsidiaries party thereto, the institutions party thereto as
lenders and issuing banks, Bank of America, N.A., as the revolving agent,
Jewelry Investors II, L.L.C., as the term agent, and the Existing Collateral
Agent.
"Facility" means the Revolving Credit Commitments and the provisions
herein related to the Revolving Loans, Swing Loans and Letters of Credit.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average
of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for
such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average of the quotations
for such day on such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by it.
17
"Federal Reserve Board" means the Board of Governors of the United
States Federal Reserve System, or any successor thereto.
"Fee Letter" shall mean the letter, dated as of January 24, 2005,
addressed to the Borrower from Citicorp and the Arranger and accepted by the
Borrower on January 25, 2005, with respect to certain fees to be paid from
time to time to Citicorp and the Arranger.
"Final Order" means an order of the Bankruptcy Court pursuant to
section 364 of the Bankruptcy Code, approving this Agreement and the other
Loan Documents and authorizing the incurrence by the Loan Parties of permanent
post-petition secured and super-priority Indebtedness in accordance with this
Agreement, and as to which no stay has been entered and which has not been
reversed, modified, vacated or overturned, and which is in form and substance
satisfactory to the Administrative Agent in its sole discretion and the
Requisite Lenders.
"Financial Asset" has the meaning given to such term in the UCC.
"Financial Statements" means the financial statements of the Borrower
and its Subsidiaries delivered in accordance with Sections 4.4 (Financial
Statements) and 6.1 (Financial Statements).
"First Day Orders" means all orders entered by the Bankruptcy Court
on the Petition Date or within five Business Days of the Petition Date or
based on motions filed on the Petition Date.
"Fiscal Month" shall mean each of the twelve fiscal months of the
Borrower, each of which ends on or about the last day of a calendar month.
"Fiscal Quarter" means each of the three-Fiscal Month periods ending
on or about March 31, June 30, September 30 and December 31.
"Fiscal Year" means the twelve-Fiscal Month period ending on or about
September 30.
"Fund" means any Person (other than a natural Person) that is or will
be engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute
of Certified Public Accountants and the statements and pronouncements of the
Financial Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of the
accounting profession, that are applicable to the circumstances as of the date
of determination.
"General Intangible" has the meaning given to such term in the UCC.
"Governmental Authority" means any nation, sovereign or government,
any state or other political subdivision thereof and any entity or authority
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including any central bank or stock
exchange.
18
"Gross Installment Contract Payments" means, as of any date of
determination with respect to each Installment Contract, the outstanding
balance thereof including all unearned interest, premiums for insurance and
product warranties, and other fees and charges, whether earned or unearned,
owing by the debtor thereunder.
"Guaranty" means the guaranty of the Secured Obligations of the
Borrower made by the Subsidiary Guarantors pursuant to Article X (Guaranty) of
this Agreement.
"Guaranty Obligation" means, as applied to any Person, any direct or
indirect liability, contingent or otherwise, of such Person with respect to
any Indebtedness of another Person, if the purpose or intent of such Person in
incurring the Guaranty Obligation is to provide assurance to the obligee of
such Indebtedness that such Indebtedness will be paid or discharged, that any
agreement relating thereto will be complied with, or that any holder of such
Indebtedness will be protected (in whole or in part) against loss in respect
thereof, including (a) the direct or indirect guaranty, endorsement (other
than for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of Indebtedness
of another Person and (b) any liability of such Person for Indebtedness of
another Person through any agreement (contingent or otherwise) (i) to
purchase, repurchase or otherwise acquire such Indebtedness or any security
therefor or to provide funds for the payment or discharge of such Indebtedness
(whether in the form of a loan, advance, stock purchase, capital contribution
or otherwise), (ii) to maintain the solvency or any balance sheet item, level
of income or financial condition of another Person, (iii) to make take-or-pay
or similar payments, if required, regardless of non-performance by any other
party or parties to an agreement, (iv) to purchase, sell or lease (as lessor
or lessee) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Indebtedness or to
assure the holder of such Indebtedness against loss or (v) to supply funds to,
or in any other manner invest in, such other Person (including to pay for
property or services irrespective of whether such property is received or such
services are rendered), if in the case of any agreement described under clause
(b)(i), (ii), (iii), (iv) or (v) above the primary purpose or intent thereof
is to provide assurance that Indebtedness of another Person will be paid or
discharged, that any agreement relating thereto will be complied with or that
any holder of such Indebtedness will be protected (in whole or in part)
against loss in respect thereof. The amount of any Guaranty Obligation shall
be equal to the amount of the Indebtedness so guaranteed or otherwise
supported.
"Hedging Contracts" means all Interest Rate Contracts, foreign
exchange contracts, currency swap or option agreements, forward contracts,
commodity swap, purchase or option agreements, other commodity price hedging
arrangements and all other similar agreements or arrangements designed to
alter the risks of any Person arising from fluctuations in interest rates,
currency values or commodity prices.
"Incremental Facility" means that portion of the Facility made
available to the Borrower from and after the Incremental Facility Effective
Date.
"Incremental Facility Effective Date" means the date on which the
conditions precedent set forth in Section 3.2 shall have been satisfied.
"Incremental Projections" means those financial projections covering
the 2 year period from the Closing Date to January 2007 inclusive, to be
delivered to the Lenders by the Borrower pursuant to Section 3.2(b)(i).
19
"Indebtedness" of any Person means without duplication (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person evidenced by notes, bonds, debentures or similar instruments or that
bear interest, (c) all reimbursement and all obligations with respect to
letters of credit, bankers' acceptances, surety bonds and performance bonds,
whether or not matured, (d) all indebtedness for the deferred purchase price
of property or services, other than trade payables and other account payables
and expense accruals incurred in the ordinary course of business, (e) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property), (f) all Capital Lease Obligations of such Person and the present
value of future rental payments under all synthetic leases, (g) all Guaranty
Obligations of such Person, (h) all obligations of such Person to purchase,
redeem, retire, defease or otherwise acquire for value any Stock or Stock
Equivalents of such Person, valued, in the case of redeemable preferred stock,
at the greater of its voluntary liquidation preference and its involuntary
liquidation preference plus accrued and unpaid dividends, (i) all payments
that such Person would have to make in the event of an early termination on
the date Indebtedness of such Person is being determined in respect of Hedging
Contracts of such Person and (j) all Indebtedness of the type referred to
above secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien upon or in property
(including Accounts and General Intangibles) owned by such Person, even though
such Person has not assumed or become liable for the payment of such
Indebtedness.
"Indemnified Matter" has the meaning specified in Section 13.4
(Indemnities).
"Indemnitee" has the meaning specified in Section 13.4 (Indemnities).
"Installment Contract" means any loan agreement, installment sale
contract, or other form of instrument or document evidencing obligations owing
by a retail purchaser to a Loan Party with respect to financial accommodations
provided by such Loan Party to such purchaser in connection with a sale of
merchandise to such purchaser.
"Instrument" has the meaning given to such term in the UCC, other
than instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper.
"Intellectual Property" means, collectively, all rights, priorities
and privileges of any Loan Party relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including Copyrights, Copyright Licenses, Patents, Patent Licenses,
Trademarks, Trademark Licenses and trade secrets, and all rights to xxx at law
or in equity for any infringement or other impairment thereof, including the
right to receive all proceeds and damages therefrom.
"Interest Period" means, in the case of any Eurodollar Rate Loan, (a)
initially, the period commencing on the date such Eurodollar Rate Loan is made
or on the date of conversion of a Base Rate Loan to such Eurodollar Rate Loan
and ending one, two, three or six months thereafter, as selected by the
Borrower in its Notice of Borrowing or Notice of Conversion or Continuation
given to the Administrative Agent pursuant to Section 2.2 (Borrowing
Procedures) or 2.11 (Conversion/Continuation Option), and (b) thereafter, if
such Loan is continued, in whole or in part, as a Eurodollar Rate Loan
pursuant to Section 2.11 (Conversion/Continuation Option), a period commencing
on the last day of the immediately preceding Interest Period therefor and
ending one, two, three or six months thereafter, as selected by the Borrower
20
in its Notice of Conversion or Continuation given to the Administrative Agent
pursuant to Section 2.11 (Conversion/Continuation Option); provided, however,
that with respect to all Eurodollar Rate Loans prior to the Syndication
Completion Date, each such period shall end seven days after the date of
making thereof, conversion thereto or continuation therof; provided, further,
that all of the foregoing provisions relating to Interest Periods in respect
of Eurodollar Rate Loans are subject to the following:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless the result of such extension
would be to extend such Interest Period into another calendar month,
in which event such Interest Period shall end on the immediately
preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month;
(iii) the Borrower may not select any Interest Period that ends
after the date of a scheduled principal payment on the Loans as set
forth in Article II (The Facility) unless, after giving effect to
such selection, the aggregate unpaid principal amount of the Loans
for which Interest Periods end after such scheduled principal payment
shall be equal to or less than the principal amount to which the
Loans are required to be reduced after such scheduled principal
payment is made;
(iv) the Borrower may not select any Interest Period in respect
of Loans having an aggregate principal amount of less than $500,000;
and
(v) there shall be outstanding at any one time no more than 5
Interest Periods in the aggregate.
"Interest Rate Contracts" means all interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements and interest
rate insurance.
"Interim Facility" means that portion of the Facility made available
to the Borrower prior to the Incremental Facility Effective Date, as approved
by the Interim Order and, after its entry, the Final Order.
"Interim Facility Commitment Amount" means $40,000,000.
"Interim Order" means that certain order issued by the Bankruptcy
Court in substantially the form of Exhibit J and otherwise in form and
substance satisfactory to the Administrative Agent in its sole discretion.
"Interim Projections" means those financial projections covering the
12 month period from January 2005 through December 2005 inclusive, to be
delivered to the Lenders by the Borrower pursuant to Section 3.1(e).
"Inventory" has the meaning given to such term in the UCC.
21
"Investment" means, with respect to any Person, (a) any purchase or
other acquisition by such Person of (i) any Security issued by, (ii) a
beneficial interest in any Security issued by, or (iii) any other equity
ownership interest in, any other Person, (b) any purchase by such Person of
all or a significant part of the assets of a business conducted by any other
Person, or all or substantially all of the assets constituting the business of
a division, branch or other unit operation of any other Person, (c) any loan,
advance (other than deposits with financial institutions available for
withdrawal on demand, prepaid expenses, accounts receivable and similar items
made or incurred in the ordinary course of business as presently conducted) or
capital contribution by such Person to any other Person, including all
Indebtedness of any other Person to such Person arising from a sale of
property by such Person other than in the ordinary course of its business and
(d) any Guaranty Obligation incurred by such Person in respect of Indebtedness
of any other Person.
"Investment Property" has the meaning given to such term in the UCC.
"IRS" means the Internal Revenue Service of the United States or any
successor thereto.
"Issue" means, with respect to any Letter of Credit, to issue, extend
the expiry of, renew or increase the maximum face amount (including by
deleting or reducing any scheduled decrease in such maximum face amount) of,
such Letter of Credit. The terms "Issued" and "Issuance" shall have a
corresponding meaning.
"Issuer" means each Lender or Affiliate of a Lender that (a) is
listed on the signature pages hereof as an "Issuer" or (b) hereafter becomes
an Issuer with the approval of the Administrative Agent and the Borrower by
agreeing pursuant to an agreement with and in form and substance satisfactory
to the Administrative Agent and the Borrower to be bound by the terms hereof
applicable to Issuers.
"Joinder Agreement" means a joinder agreement, substantially in the
form of Exhibit N, executed and delivered by each additional Subsidiary
Guarantor pursuant to Section 7.11.
"Land" of any Person means all of those plots, pieces or parcels of
land now owned, leased or hereafter acquired or leased or purported to be
owned, leased or hereafter acquired or leased (including, in respect of the
Loan Parties, as reflected in the most recent Financial Statements) by such
Person.
"Landlord Waiver" means a letter in form and substance reasonably
acceptable to the Administrative Agent and executed by a landlord in respect
of Inventory of any Loan Party located at any leased premises of such Loan
Party pursuant to which such landlord, among other things, waives or
subordinates on terms and conditions reasonably acceptable to the
Administrative Agent any Lien such landlord may have in respect of such
Inventory.
"Leases" means, with respect to any Person, all of those leasehold
estates in real property of such Person, as lessee, as such may be amended,
supplemented or otherwise modified from time to time.
"Lender" means the Swing Loan Lender and each other financial
institution or other entity that (a) is listed on the signature pages hereof
as a "Lender" or (b) from time to time becomes a party hereto by execution of
an Assignment and Acceptance.
22
"Letter of Credit" means any letter of credit Issued pursuant to
Section 2.4 (Letters of Credit).
"Letter of Credit Obligations" means, at any time, the aggregate of
all liabilities at such time of the Borrower to all Issuers with respect to
Letters of Credit, whether or not any such liability is contingent, including,
without duplication, the sum of (a) the Reimbursement Obligations at such time
and (b) the Letter of Credit Undrawn Amounts at such time.
"Letter of Credit Reimbursement Agreement" has the meaning specified
in Section 2.4(a)(vi) (Letter of Credit).
"Letter of Credit Request" has the meaning specified in Section
2.4(c) (Letters of Credit).
"Letter of Credit Sublimit" means $15,000,000.
"Letter of Credit Undrawn Amounts" means, at any time, the aggregate
undrawn face amount of all Letters of Credit outstanding at such time.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, charge, deposit arrangement, encumbrance, lien (statutory or
other), security interest or preference, priority or other security agreement
or preferential arrangement of any kind or nature whatsoever intended to
assure payment of any Indebtedness or the performance of any other obligation,
including any conditional sale or other title retention agreement, the
interest of a lessor under a Capital Lease and any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the UCC or comparable law of any jurisdiction
naming the owner of the asset to which such Lien relates as debtor.
"LLC" means each limited liability company in which any Loan Party
has an interest.
"Loan" means any loan made by any Lender pursuant to this Agreement.
"Loan Documents" means, collectively, this Agreement, the Revolving
Credit Notes (if any), the Guaranty, the Fee Letter, each Letter of Credit
Reimbursement Agreement, the Collateral Documents and each certificate,
agreement or document executed by a Loan Party and delivered to the
Administrative Agent or any Lender in connection with or pursuant to any of
the foregoing.
"Loan Party" means each of the Borrower, each Subsidiary Guarantor
and each other Subsidiary of the Borrower that executes and delivers a Loan
Document.
"Material Adverse Change" means a material adverse change in any of
(a) the condition (financial or otherwise), business, performance, prospects,
operations or properties of the Borrower and its Subsidiaries taken as a
whole, (b) the legality, validity or enforceability of any Loan Document, (c)
the perfection or priority of the Liens granted pursuant to this Agreement,
the Collateral Documents and the Orders, (d) the ability of the Borrower to
repay the Obligations or of the other Loan Parties to perform their respective
obligations under the Loan Documents or (e) the rights and remedies of the
Administrative Agent, the Lenders or the Issuers under the Loan Documents.
23
"Material Adverse Effect" means an effect that results in or causes,
or could reasonably be expected to result in or cause, a Material Adverse
Change.
"Material Intellectual Property" means Intellectual Property owned by
or licensed to a Loan Party and material to the conduct of any Loan Party's
business.
"Maximum Credit" means, at any time, (a) the lesser of (i) the
Revolving Credit Commitments in effect at such time and (ii) the Borrowing
Base at such time minus (b) the aggregate amount of the Availability Reserve
in effect at such time.
"Xxxxx'x" means Xxxxx'x Investors Services, Inc.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower, any of its Subsidiaries or
any ERISA Affiliate has any obligation or liability, contingent or otherwise.
"Net Balance" means, as of any date of determination, the Gross
Installment Contract Payments of an Installment Contract, less all unearned
interest, fees, and charges (including premiums for insurance and product
warranties) owing by the debtor thereunder.
"Net Cash Proceeds" means proceeds received by the Borrower or any of
its Subsidiaries after the Closing Date in cash or Cash Equivalents from any
(a) Asset Sale, other than an Asset Sale permitted under Section 8.4 (Sale of
Assets), net of (i) the reasonable cash costs of sale, assignment or other
disposition, (ii) taxes paid or reasonably estimated to be payable as a result
thereof and (iii) any amount required by the Bankruptcy Court to be paid or
prepaid on Indebtedness (other than the Obligations) secured by a perfected
and unavoidable lien on the assets subject to such Asset Sale; provided,
however, that evidence of each of clauses (i), (ii) and (iii) above is
provided to the Administrative Agent in form and substance satisfactory to it,
(b) Property Loss Event, (c)(i) Equity Issuance or (ii) Debt Issuance or (d)
Avoidance Action, in the case of clauses (a), (b) and (c), net of brokers' and
advisors' fees and other costs incurred in connection with such transaction;
provided, however, that in the case of clause (c), evidence of such costs is
provided to the Administrative Agent in form and substance satisfactory to it.
"Net Orderly Liquidation Value" means, with respect to any Inventory
or Installment Contracts, the recovery value thereof in an orderly liquidation
net of all costs of liquidation, as reasonably determined by the
Administrative Agent based upon methodology utilized in the most recent
written appraisal of the Loan Parties' Inventory and Installment Contracts, as
determined by, with respect to Installment Contracts, EMCC Inc., with respect
to Inventory, GB Asset Advisors, LLC or in any case, another third party
appraiser satisfactory to the Administrative Agent.
"Non-Consenting Lender" has the meaning specified in Section 13.1(c)
(Amendments, Waivers, Etc.).
"Non-Funding Lender" has the meaning specified in Section 2.2(d)
(Borrowing Procedures).
"Non-U.S. Lender" means each Lender (or the Administrative Agent)
that is not a United States person as defined in Section 7701(a)(30) of the
Code.
"Non-U.S. Person" means any Person that is not a Domestic Person.
24
"Notice of Borrowing" has the meaning specified in Section 2.2(a)
(Borrowing Procedures).
"Notice of Conversion or Continuation" has the meaning specified in
Section 2.11 (Conversion/Continuation Options).
"Obligations" means the Loans, the Letter of Credit Obligations and
all other amounts, obligations, covenants and duties owing by the Borrower to
the Administrative Agent, any Lender, any Issuer, any Affiliate of any of them
or any Indemnitee, of every type and description (whether by reason of an
extension of credit, opening or amendment of a letter of credit or payment of
any draft drawn or other payment thereunder, loan, guaranty, indemnification,
foreign exchange or currency swap transaction, interest rate hedging
transaction or otherwise), present or future, arising under this Agreement,
any other Loan Document, whether direct or indirect (including those acquired
by assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired and whether or not evidenced by any
note, guaranty or other instrument or for the payment of money, including all
letter of credit and other fees, interest, charges, expenses, attorneys' fees
and disbursements and other sums chargeable to the Borrower under this
Agreement, any other Loan Document and all obligations of the Borrower under
any Loan Document to provide cash collateral for any Letter of Credit
Obligations.
"Orders" means the Interim Order or the Final Order, as applicable.
"Partnership" means each partnership in which any Loan Party has an
interest.
"Patents" means (a) all letters patent of the United States, any
other country or any political subdivision thereof and all reissues and
extensions thereof, (b) all applications for letters patent of the United
States or any other country and all divisions, continuations and
continuations-in-part thereof, and (c) all rights to obtain any reissues or
extensions of the foregoing.
"Patent License" means all agreements, whether written or oral,
providing for the grant by or to any Loan Party of any right to manufacture,
use, import, sell or offer for sale any invention covered in whole or in part
by a Patent.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Permit" means any permit, approval, authorization, license, variance
or permission required from a Governmental Authority under an applicable
Requirement of Law.
"Permitted Prepetition Claim Payment" means a payment (as adequate
protection or otherwise) on account of any claim arising or deemed to have
arisen prior to the commencement of the Cases, which is made (i) pursuant to
authority granted by a First Day Order, (ii) pursuant to a Permitted
Transaction in respect of the Vendor Lien Program, (iii) on account of claims
in respect of the assumption of leases, (iv) with the consent of the
Administrative Agent, (v) to pay secured Indebtedness constituting a Capital
Lease or purchase money Indebtedness with Proceeds received from the sale of
the specific assets securing such Indebtedness, (vi) on account of reclamation
claims up to $3,000,000 in the aggregate, (vii) in respect of interest
payments at the non-default contract rate on the secured Indebtedness incurred
25
to finance the acquisition of the Chief Executive Office, or (viii) in respect
of other amounts not exceeding $1,000,000 in the aggregate.
"Permitted Transactions" means the transactions described on Schedule
1.1.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, estate, trust, limited liability
company, unincorporated association, joint venture or other entity or a
Governmental Authority.
"Petition Date" has the meaning specified in the recitals to this
Agreement.
"Pledged Collateral" means, collectively, the Pledged Notes, the
Pledged Stock, the Pledged Partnership Interests, the Pledged LLC Interests,
any other Investment Property of any Loan Party in excess of $100,000, all
certificates or other instruments representing any of the foregoing, all
Security Entitlements of any Loan Party in respect of any of the foregoing,
all dividends, interest distributions, cash, warrants, rights, instruments and
other property or Proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the foregoing.
Pledged Collateral may be General Intangibles or Investment Property.
"Pledged LLC Interests" means all of any Loan Party's right, title
and interest as a member of any LLCs and all of such Loan Party's right, title
and interest in, to and under any LLC Agreement to which it is a party.
"Pledged Notes" means all right, title and interest of any Loan
Party, in the Instruments evidencing all Indebtedness owed to such Loan Party
issued by the obligors named therein, and all interest, cash, Instruments and
other property or Proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such Indebtedness.
"Pledged Partnership Interests" shall mean all of any Loan Party's
right, title and interest as a limited and/or general partner in all
Partnerships and all of such Loan Party's right, title and interest in, to and
under any Partnership Agreements to which it is a party.
"Pledged Stock" means the shares of capital stock owned by each Loan
Party; provided, however, that only the outstanding capital stock of a
subsidiary that is not a Domestic Subsidiary possessing up to but not
exceeding 65% of the voting power of all classes of capital stock of such
controlled foreign corporation entitled to vote shall be deemed to be pledged
hereunder.
"Prepetition Collateral" shall mean all assets securing the
Prepetition Secured Indebtedness.
"Prepetition Secured Indebtedness" shall mean (i) all Indebtedness
under the Existing Credit Agreement, (ii) all pre-petition Indebtedness under
the Vendor Lien Program and (iii) all other pre-petition secured Indebtedness
of the Borrower and its subsidiaries (except the Indebtedness secured by the
Chief Executive Office and incurred to finance the acquisition thereof).
"Proceeds" has the meaning given to such term in the UCC.
26
"Pro Forma Balance Sheet" has the meaning specified in Section
4.4(d).
"Pro Forma Basis" means, with respect to any determination for any
period, that such determination shall be made giving pro forma effect to each
acquisition of a business consummated during such period, together with all
transactions relating thereto consummated during such period (including any
incurrence, assumption, refinancing or repayment of Indebtedness), as if such
acquisition and related transactions had been consummated on the first day of
such period, in each case based on historical results accounted for in
accordance with GAAP and, to the extent applicable, reasonable assumptions
that are specified in details in the relevant Compliance Certificate,
Financial Statement or other document provided to the Administrative Agent or
any Lender in connection herewith in accordance with Regulation S-X of the
Securities Act of 1933.
"Projections" means the Interim Projections and the Incremental
Projections.
"Property Loss Event" means (a) any loss of or damage to property of
the Borrower or any of its Subsidiaries that results in the receipt by such
Person of proceeds of insurance in excess of $250,000 (individually or in the
aggregate) or (b) any taking of property of the Borrower or any of its
Subsidiaries that results in the receipt by such Person of a compensation
payment in respect thereof in excess of $250,000 (individually or in the
aggregate).
"Protective Advances" means all expenses, disbursements and advances
incurred by the Administrative Agent pursuant to the Loan Documents after the
occurrence and during the continuance of an Event of Default that the
Administrative Agent, in its sole discretion, deems necessary or desirable to
preserve or protect the Collateral or any portion thereof or to enhance the
likelihood, or maximize the amount of repayment of the Obligations.
"Purchasing Lender" has the meaning specified in Section 13.7
(Sharing of Payments, etc.)
"Ratable Portion" or (other than in the expression "equally and
ratably") "ratably" means, with respect to any Revolving Credit Lender, the
percentage obtained by dividing (a) the Revolving Credit Commitment of such
Revolving Credit Lender by (b) the aggregate Revolving Credit Commitments of
all Revolving Credit Lenders (or, at any time after the Revolving Credit
Termination Date, the percentage obtained by dividing the aggregate
outstanding principal balance of the Revolving Credit Outstandings owing to
such Revolving Credit Lender by the aggregate outstanding principal balance of
the Revolving Credit Outstandings owing to all Revolving Credit Lenders).
"Real Property" of any Person means the Land of such Person, together
with the right, title and interest of such Person, if any, in and to the
streets, the Land lying in the bed of any streets, roads or avenues, opened or
proposed, in front of, the air space and development rights pertaining to the
Land and the right to use such air space and development rights, all rights of
way, privileges, liberties, tenements, hereditaments and appurtenances
belonging or in any way appertaining thereto, all fixtures, all easements now
or hereafter benefiting the Land and all royalties and rights appertaining to
the use and enjoyment of the Land, including all alley, vault, drainage,
mineral, water, oil and gas rights, together with all of the buildings and
other improvements now or hereafter erected on the Land, and any fixtures
appurtenant thereto.
"Register" has the meaning specified in Section 13.2(c) (Assignments
and Participations).
27
"Reimbursement Date" has the meaning specified in Section 2.4(h)
(Letters of Credit).
"Reimbursement Obligations" means, as and when matured, the
obligation of the Borrower to pay, on the date payment is made or scheduled to
be made to the beneficiary under each such Letter of Credit (or at such other
date as may be specified in the applicable Letter of Credit Reimbursement
Agreement) and in the currency drawn (or in such other currency as may be
specified in the applicable Letter of Credit Reimbursement Agreement), all
amounts of the drafts and other requests for payments drawn under Letters of
Credit, and all other matured reimbursement or repayment obligations of the
Borrower to any Issuer with respect to amounts drawn under Letters of Credit.
"Reinvestment Deferred Amount" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the portion of such Net Cash Proceeds
subject to a Reinvestment Notice.
"Reinvestment Event" means any Property Loss Event in respect of
which the Borrower has delivered a Reinvestment Notice.
"Reinvestment Notice" means a written notice executed by a
Responsible Officer of the Borrower stating that no Default or Event of
Default has occurred and is continuing and that the Borrower (directly or
indirectly through one of its Subsidiaries) intends and expects to use all or
a specified portion of the Net Cash Proceeds of a Property Loss Event to
acquire replacement assets useful in its or one of its Subsidiaries'
businesses or to effect repairs.
"Reinvestment Prepayment Amount" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the Reinvestment Deferred Amount for such
Net Cash Proceeds less any amount expended or required to be expended pursuant
to a Contractual Obligation entered into prior to the relevant Reinvestment
Prepayment Date for such Net Cash Proceeds to acquire, to the extent otherwise
permitted hereunder, replacement assets useful in the business of the Borrower
or any of its Subsidiaries or to effect repairs.
"Reinvestment Prepayment Date" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the earlier of (a) the date occurring 180
days after such Reinvestment Event and (b) the date that is five Business Days
after the date on which the Borrower shall have notified the Administrative
Agent of the Borrower's determination not to acquire replacement assets useful
in the Borrower's or a Subsidiary's business (or not to effect repairs) with
all or any portion of the relevant Reinvestment Deferred Amount for such Net
Cash Proceeds.
"Release" means, with respect to any Person, any release, spill,
emission, leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching or migration, in each case, of any Contaminant into the
indoor or outdoor environment or into or out of any property owned, leased or
operated by such Person, including the movement of Contaminants through or in
the air, soil, surface water, ground water or property.
"Remedial Action" means all actions required to (a) clean up, remove,
treat or in any other way address any Contaminant in the indoor or outdoor
environment, (b) prevent the Release or threat of Release or minimize the
further Release so that a Contaminant does not migrate or endanger or threaten
to endanger public health or welfare or the indoor or outdoor environment or
(c) perform pre-remedial studies and investigations and post-remedial
monitoring and care.
28
"Requirement of Law" means, with respect to any Person, the common
law and all federal, state, local and foreign laws, treaties, rules and
regulations, orders, judgments, decrees and other determinations of,
concessions, grants, franchises, licenses and other Contractual Obligations
with, any Governmental Authority or arbitrator, applicable to or binding upon
such Person or any of its property or to which such Person or any of its
property is subject.
"Requisite Lenders" means, collectively, Revolving Credit Lenders
having more than fifty percent (50%) of the aggregate outstanding amount of
the Revolving Credit Commitments or, after the Revolving Credit Termination
Date, more than fifty percent (50%) of the aggregate Revolving Credit
Outstandings. A Non-Funding Lender shall not be included in the calculation of
"Requisite Lenders."
"Responsible Officer" means, with respect to any Person, any of the
principal executive officers, managing members or general partners of such
Person but, in any event, with respect to financial matters, the chief
executive officer, chief financial officer, treasurer or controller of such
Person.
"Restricted Payment" means (a) any dividend, distribution or any
other payment, whether direct or indirect, on account of any Stock or Stock
Equivalents of the Borrower or any of its Subsidiaries now or hereafter
outstanding and (b) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
Stock or Stock Equivalent of the Borrower or any of its Subsidiaries now or
hereafter outstanding.
"Revolving Credit Commitment" means, with respect to each Revolving
Credit Lender, the commitment of such Revolving Credit Lender to make
Revolving Loans and acquire interests in other Revolving Credit Outstandings
in the aggregate principal amount outstanding not to exceed the amount set
forth opposite such Revolving Credit Lender's name on Schedule I under the
caption "Revolving Credit Commitment," as amended to reflect each Assignment
and Acceptance executed by such Revolving Credit Lender and as such amount may
be reduced pursuant to this Agreement.
"Revolving Credit Lender" means each Lender other than the Swing Loan
Lender.
"Revolving Credit Note" means a promissory note of the Borrower
payable to the order of any Revolving Credit Lender in a principal amount
equal to the amount of such Revolving Credit Lender's Revolving Credit
Commitment evidencing the aggregate Indebtedness of the Borrower to such
Revolving Credit Lender resulting from the Revolving Loans owing to such
Revolving Credit Lender.
"Revolving Credit Outstandings" means, at any particular time, the
sum of (a) the principal amount of the Revolving Loans outstanding at such
time, (b) the Letter of Credit Obligations outstanding at such time and (c)
the principal amount of the Swing Loans outstanding at such time.
"Revolving Credit Termination Date" shall mean the earliest of (a)
the Scheduled Termination Date, (b) the date of termination of all of the
Revolving Credit Commitments pursuant to Section 2.5 (Reduction and
Termination of the Revolving Credit Commitments) and (c) the date on which the
Obligations become due and payable pursuant to Section 9.2 (Remedies).
29
"Revolving Loan" has the meaning specified in Section 2.1 (The
Revolving Credit Commitments).
"S&P" means Standard & Poor's Rating Services.
"Xxxxxxxx-Xxxxx Act" means the United States Xxxxxxxx-Xxxxx Act of
2002.
"Scheduled Termination Date" means the earlier of (i) the first
anniversary of the Closing Date, and (ii) the effective date of a plan of
reorganization in the Cases; provided, however, that the date referred to in
clause (i) shall automatically be extended to the second anniversary of the
Closing Date upon the occurrence of the Incremental Facility Effective Date.
"Secured Obligations" means (a) in the case of the Borrower, (i) the
Obligations and (ii) all other amounts, obligations, covenants and duties
owing by the Borrower to the Administrative Agent, any Lender, any Issuer, any
Affiliate of any of them or any Indemnitee, of every type and description
(whether by reason of an extension of credit, opening or amendment of a letter
of credit or payment of any draft drawn or other payment thereunder, loan,
guaranty, indemnification, foreign exchange or currency swap transaction,
interest rate hedging transaction or otherwise), present or future, arising
under each Hedging Contract between the Borrower and any Person that was a
Lender or an Affiliate of a Lender at the time it entered into such Hedging
Contract and each Cash Management Document, and (b) in the case of any other
Loan Party, (i) the obligations of such Loan Party under the Guaranty and the
other Loan Documents to which it is a party and (ii) all other amounts,
obligations, covenants and duties owing by such Loan Party to the
Administrative Agent, any Lender, any Issuer, any Affiliate of any of them or
any Indemnitee, of every type and description (whether by reason of an
extension of credit, opening or amendment of a letter of credit or payment of
any draft drawn or other payment thereunder, loan, guaranty, indemnification,
foreign exchange or currency swap transaction, interest rate hedging
transaction or otherwise), present or future, arising under each Hedging
Contract between such Loan Party and any Person that was a Lender or an
Affiliate of a Lender at the time it entered into such Hedging Contract and
each Cash Management Document.
"Secured Parties" means the Lenders, the Issuers, the Administrative
Agent and any other holder of any "Secured Obligation".
"Securities Account" has the meaning given to such term in the UCC.
"Securities Account Control Agreement" means a letter agreement,
substantially in the form of Exhibit L (Form of Securities Account Control
Agreement) (with such changes as may be agreed to by the Administrative
Agent), executed by the relevant Loan Party, the Administrative Agent and the
relevant Approved Securities Intermediary.
"Securities Entitlement" has the meaning given to such term in the
UCC.
"Securities Intermediary" has the meaning given to such term in the
UCC.
"Security" means any Stock, Stock Equivalent, voting trust
certificate, bond, debenture, note or other evidence of Indebtedness, whether
secured, unsecured, convertible or subordinated, or any certificate of
interest, share or participation in, any temporary or interim certificate for
the purchase or acquisition of, or any right to subscribe to, purchase or
acquire, any of the foregoing, but shall not include any evidence of the
Obligations.
30
"Selling Lender" has the meaning specified in Section 13.7 (Sharing
of Payments, Etc.).
"Special Purpose Vehicle" means any special purpose funding vehicle
of any Lender identified as such in writing by any such Lender to the
Administrative Agent.
"Standby Letter of Credit" means any Letter of Credit that is not a
Documentary Letter of Credit.
"Stock" means shares of capital stock (whether denominated as common
stock or preferred stock), beneficial, partnership or membership interests,
participations or other equivalents (regardless of how designated) of or in a
corporation, partnership, limited liability company or equivalent entity,
whether voting or non-voting.
"Stock Equivalents" means all securities convertible into or
exchangeable for Stock and all warrants, options or other rights to purchase
or subscribe for any Stock, whether or not presently convertible, exchangeable
or exercisable.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company or other business entity of which an
aggregate of 50% or more of the outstanding Voting Stock is, at the time,
directly or indirectly, owned or controlled by such Person or one or more
Subsidiaries of such Person.
"Subsidiary Guarantor" means each Subsidiary of the Borrower party to
or that becomes party to this Agreement.
"Substitute Institution" has the meaning specified in Section 2.17
(Substitution of Lenders).
"Substitution Notice" has the meaning specified in Section 2.17
(Substitution of Lenders).
"Swing Loan" has the meaning specified in Section 2.3 (Swing Loans).
"Swing Loan Lender" means Citicorp or any other Revolving Credit
Lender that becomes the Administrative Agent or agrees, with the approval of
the Administrative Agent and the Borrower, to act as the Swing Loan Lender
hereunder, in each case, in it capacity as the Swing Loan Lender hereunder.
"Swing Loan Request" has the meaning specified in Section 2.3(b)
(Swing Loans).
"Swing Loan Sublimit" means $15,000,000.
"Syndication Completion Date" means the earlier to occur of (a) the
90th day following the Closing Date and (b) the date upon which the
Administrative Agent determines in its sole discretion that the primary
syndication of the Loans and Revolving Credit Commitments has been completed.
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"Tax Affiliate" means, with respect to any Person, (a) any Subsidiary
of such Person, and (b) any Affiliate of such Person with which such Person
files or is eligible to file consolidated, combined or unitary tax returns.
"Tax Return" has the meaning specified in Section 4.8(a) (Taxes).
"Taxes" has the meaning specified in Section 2.16(a) (Taxes).
"Title IV Plan" means a pension plan, other than a Multiemployer
Plan, covered by Title IV of ERISA and to which the Borrower any of its
Subsidiaries or any ERISA Affiliate has any obligation or liability,
contingent or otherwise.
"Trademarks" means (a) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all
goodwill associated therewith, now existing or hereafter adopted or acquired,
all registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, and (b) the right to obtain all renewals thereof.
"Trademark License" means any agreement, whether written or oral,
providing for the grant by or to any Loan Party of any right to use any
Trademark.
"UCC" means the Uniform Commercial Code as from time to time in
effect in the State of New York; provided, however, that, in the event that,
by reason of mandatory provisions of law, any of the attachment, perfection or
priority of the Administrative Agent's and the Secured Parties' security
interest in any Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of New York, the term "UCC"
shall mean the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such attachment, perfection
or priority and for purposes of definitions related to such provisions.
"Unfunded Pension Liability" means, with respect to the Borrower or
any of its Subsidiaries at any time, the sum of (a) the amount, if any, by
which the present value of all accrued benefits under each Title IV Plan
(other than any Title IV Plan subject to Section 4063 of ERISA) exceeds the
fair market value of all assets of such Title IV Plan allocable to such
benefits in accordance with Title IV of ERISA, as determined as of the most
recent valuation date for such Title IV Plan using the actuarial assumptions
in effect under such Title IV Plan, (b) the aggregate amount of withdrawal
liability that could be assessed under Section 4063 with respect to each Title
IV Plan subject to such section, separately calculated for each such Title IV
Plan as of its most recent valuation date and (c) for a period of five years
following a transaction reasonably likely to be covered by Section 4069 of
ERISA, the liabilities (whether or not accrued) that could be avoided by the
Borrower, any of its Subsidiaries or any ERISA Affiliate as a result of such
transaction.
"Unused Commitment Fee" has the meaning specified in Section 2.12(a)
(Fees).
"U.S. Trustee" means the United States Trustee for the Southern
District of Georgia.
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"Vehicles" means all vehicles covered by a certificate of title law
of any state.
"Vendor Lien Program" means the program and documents pursuant to
which one or more vendors of the Loan Parties agreed to defer the payment of
trade accounts payable owing by the Loan Parties for merchandise purchased or
memo goods sold prior to July 31, 2004 and past due as of such date, as such
program may now or hereafter be amended, supplemented or otherwise modified to
the extent expressly permitted by this Agreement.
"Voting Stock" means Stock of any Person having ordinary power to
vote in the election of members of the board of directors, managers, trustees
or other controlling Persons, of such Person (irrespective of whether, at the
time, Stock of any other class or classes of such entity shall have or might
have voting power by reason of the happening of any contingency).
"Wholly-Owned Subsidiary" of any Person means any Subsidiary of such
Person, all of the Stock of which (other than director's qualifying shares, as
may be required by law) is owned by such Person, either directly or indirectly
through one or more Wholly-Owned Subsidiaries of such Person.
"Withdrawal Liability" means, with respect to the Borrower or any of
its Subsidiaries at any time, the aggregate liability incurred (whether or not
assessed) with respect to all Multiemployer Plans pursuant to Section 4201 of
ERISA or for increases in contributions required to be made pursuant to
Section 4243 of ERISA.
Section 1.2. Computation of Time Periods. In this Agreement, in the
computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each mean "to but excluding" and the word "through" means "to and
including."
Section 1.3. Accounting Terms and Principles.
-------------------------------
(a) Except as set forth below, all accounting terms not specifically
defined herein shall be construed in conformity with GAAP and all accounting
determinations required to be made pursuant hereto (including for purposes of
measuring compliance with Article V (Financial Covenants) shall, unless
expressly otherwise provided herein, be made in conformity with GAAP.
(b) If any change in the accounting principles used in the
preparation of the most recent Financial Statements referred to in Section 6.1
(Financial Statements) is hereafter required or permitted by the rules,
regulations, pronouncements and opinions of the Financial Accounting Standards
Board or the American Institute of Certified Public Accountants (or any
successors thereto) or is required in connection with the resolution of the
Borrower's outstanding accounting issues, and any such change is adopted by
the Borrower with the agreement of the Borrower's Accountants and results in a
change in any of the calculations required by Article V or Article VIII that
would not have resulted had such accounting change not occurred, the parties
hereto agree to enter into negotiations in order to amend such provisions so
as to equitably reflect such change such that the criteria for evaluating
compliance with such covenants by the Borrower shall be the same after such
change as if such change had not been made; provided, however, that no such
change that would affect a calculation that measures compliance with any
covenant contained in Article V or Article VIII shall be given effect until
such provisions are amended to reflect such changes.
33
(c) For purposes of making all financial calculations to determine
compliance with Article V (Financial Covenants), all components of such
calculations shall be adjusted to include or exclude, as the case may be,
without duplication, such components of such calculations attributable to any
business that have been acquired by the Borrower or any of its Subsidiaries
after the first day of the applicable period of determination and prior to the
end of such period, as determined in good faith by the Borrower on a Pro Forma
Basis.
Section 1.4. Certain Terms.
-------------
(a) The terms "herein," "hereof", "hereto" and "hereunder" and
similar terms refer to this Agreement as a whole and not to any particular
Article, Section, subsection or clause in this Agreement.
(b) Unless otherwise expressly indicated herein, (i) references in
this Agreement to an Exhibit, Schedule, Article, Section, clause or sub-clause
refer to the appropriate Exhibit or Schedule to, or Article, Section, clause
or sub-clause in this Agreement and (ii) the words "above" and "below", when
following a reference to a clause or a sub-clause of any Loan Document, refer
to a clause or sub-clause within, respectively, the same Section or clause.
(c) Each agreement defined in this Article I shall include all
appendices, exhibits and schedules thereto. Unless the prior written consent
of the Requisite Lenders is required hereunder for an amendment, restatement,
supplement or other modification to any such agreement and such consent is not
obtained, references in this Agreement to such agreement shall be to such
agreement as so amended, restated, supplemented or modified.
(d) References in this Agreement to any statute shall be to such
statute as amended or modified from time to time and to any successor
legislation thereto, in each case as in effect at the time any such reference
is operative.
(e) The term "including" when used in any Loan Document means
"including without limitation" except when used in the computation of time
periods.
(f) The terms "Lender," "Issuer" and "Administrative Agent" include
without limitation, their respective successors.
(g) Upon the appointment of any successor Administrative Agent
pursuant to Section 12.6, references to Citicorp in Section 12.3 and to
Citibank in the definitions of Base Rate, Dollar Equivalent and Eurodollar
Rate shall be deemed to refer to the financial institution then acting as the
Administrative Agent or one of its Affiliates if it so designates.
(h) Terms not otherwise defined herein and defined in the UCC are
used herein with the meanings specified in the UCC.
ARTICLE II
THE FACILITY
Section 2.1. The Revolving Credit Commitments.
--------------------------------
(a) On the terms and subject to the conditions contained in this
Agreement, each Revolving Credit Lender severally agrees to make loans in
Dollars (each a "Revolving Loan") to the Borrower from time to time on any
34
Business Day during the period from the date hereof until the Revolving Credit
Termination Date in an aggregate principal amount at any time outstanding for
all such loans by such Revolving Credit Lender not to exceed (after giving
effect to the use of the proceeds of such loans) such Revolving Credit
Lender's Revolving Credit Commitment; provided, however, that at no time shall
any Revolving Credit Lender be obligated to make a Revolving Loan in excess of
such Revolving Credit Lender's Ratable Portion of the Available Credit. Within
the limits of the Revolving Credit Commitment of each Revolving Credit Lender,
amounts of Revolving Loans repaid may be reborrowed under this Section 2.1.
(b) Notwithstanding the foregoing clause (a) or any other provision
of this Agreement, during the period from the Closing Date to the later of (i)
entry of the Final Order and (ii) the Incremental Facility Effective Date, the
aggregate of all Revolving Credit Outstandings at any one time shall not
exceed the Interim Facility Commitment Amount.
Section 2.2. Borrowing Procedures.
--------------------
(a) Each Borrowing shall be made on notice given by the Borrower to
the Administrative Agent not later than 12:00 noon (New York time) (i) on the
Business Day of the proposed Borrowing, in the case of a Borrowing of Base
Rate Loans, and (ii) three Business Days prior to the date of the proposed
Borrowing, in the case of a Borrowing of Eurodollar Rate Loans. Each such
notice shall be in substantially the form of Exhibit C (a "Notice of
Borrowing"), specifying (A) the date of such proposed Borrowing, (B) the
aggregate amount of such proposed Borrowing, (C) whether any portion of the
proposed Borrowing will be of Base Rate Loans or Eurodollar Rate Loans, (D)
the initial Interest Period or Periods for any such Eurodollar Rate Loans and
(E) the Available Credit (after giving effect to the proposed Borrowing). The
Revolving Loans shall be made as Base Rate Loans unless, subject to Section
2.14, the Notice of Borrowing specifies that all or a portion thereof shall be
Eurodollar Rate Loans. Notwithstanding anything to the contrary contained in
Section 2.3(a) (Swing Loans), if any Notice of Borrowing requests a Borrowing
of Base Rate Loans, the Administrative Agent may make a Swing Loan available
to the Borrower in an aggregate amount not to exceed such proposed Borrowing,
and the aggregate amount of the corresponding proposed Borrowing shall be
reduced accordingly by the principal amount of such Swing Loan. Each Borrowing
shall be in an aggregate amount of not less than $500,000 or an integral
multiple of $500,000 in excess thereof.
(b) The Administrative Agent shall give to each Revolving Credit
Lender prompt notice of the Administrative Agent's receipt of a Notice of
Borrowing and, if Eurodollar Rate Loans are properly requested in such Notice
of Borrowing, the applicable interest rate determined pursuant to Section
2.14(a). Each Revolving Credit Lender shall, before 3:00 p.m. (New York time),
in the case of a Base Rate Loan, and 12:00 noon (New York time), in the case
of a Eurodollar Rate Loan, on the date of the proposed Borrowing, make
available to the Administrative Agent at its address referred to in Section
13.8, in immediately available funds, such Revolving Credit Lender's Ratable
Portion of such proposed Borrowing. Upon fulfillment (or due waiver in
accordance with Section 13.1 (Amendments, Waivers, Etc.)) (i) on the Closing
Date, of the applicable conditions set forth in Section 3.1 (Conditions
Precedent to Initial Loans and Letters of Credit), (ii) on the Incremental
Facility Effective Date, of the applicable conditions set forth in Section 3.2
(Conditions Precedent to the Incremental Facility Effective Date) and (iii) at
any time (including the Closing Date and the Incremental Facility Effective
Date), of the applicable conditions set forth in Section 3.3 (Conditions
Precedent to Each Loan and Letter of Credit), and after the Administrative
Agent's receipt of such funds, the Administrative Agent shall make such funds
available to the Borrower.
35
(c) Unless the Administrative Agent shall have received notice from a
Revolving Credit Lender prior to the date of any proposed Borrowing that such
Revolving Credit Lender will not make available to the Administrative Agent
such Revolving Credit Lender's Ratable Portion of such Borrowing (or any
portion thereof), the Administrative Agent may assume that such Revolving
Credit Lender has made such Ratable Portion available to the Administrative
Agent on the date of such Borrowing in accordance with this Section 2.2 and
the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If and to the extent that
such Revolving Credit Lender shall not have so made such Ratable Portion
available to the Administrative Agent, such Revolving Credit Lender and the
Borrower severally agree to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until the date
such amount is repaid to the Administrative Agent, at (i) in the case of the
Borrower, the interest rate applicable at the time to the Loans comprising
such Borrowing and (ii) in the case of such Revolving Credit Lender, the
Federal Funds Rate for the first Business Day and thereafter at the interest
rate applicable at the time to the Loans comprising such Borrowing. If such
Revolving Credit Lender shall repay to the Administrative Agent such
corresponding amount, such corresponding amount so repaid shall constitute
such Revolving Credit Lender's Loan as part of such Borrowing for purposes of
this Agreement. If the Borrower shall repay to the Administrative Agent such
corresponding amount, such payment shall not relieve such Revolving Credit
Lender of any obligation it may have hereunder to the Borrower.
(d) The failure of any Revolving Credit Lender to make on the date
specified any Loan or any payment required by it (such Lender being a
"Non-Funding Lender"), including any payment in respect of its participation
in Swing Loans and Letter of Credit Obligations, shall not relieve any other
Revolving Credit Lender of its obligations to make such Loan or payment on
such date but no such other Revolving Credit Lender shall be responsible for
the failure of any Non-Funding Lender to make a Loan or payment required under
this Agreement.
Section 2.3. Swing Loans.
-----------
(a) On the terms and subject to the conditions contained in this
Agreement, the Swing Loan Lender may in its sole discretion, make, in Dollars,
loans (each a "Swing Loan") otherwise available to the Borrower under the
Facility (but only as requested by the Borrower) from time to time on any
Business Day during the period from the date hereof until the Revolving Credit
Termination Date in an aggregate principal amount at any time outstanding
(together with the aggregate outstanding principal amount of any other Loan
made by the Swing Loan Lender hereunder in its capacity as a Lender or the
Swing Loan Lender) not to exceed the lesser of the (i) the Swing Loan Lender's
Ratable Portion of the Available Credit and (ii) the Swing Loan Sublimit;
provided, however, that at no time shall the Swing Loan Lender make any Swing
Loan to the extent that, after giving effect to such Swing Loan, the aggregate
Revolving Credit Outstandings would exceed the Maximum Credit. Each Swing Loan
shall be a Base Rate Loan and must be repaid in full within seven days after
its making or, if sooner, upon any Borrowing hereunder and shall in any event
mature no later than the Revolving Credit Termination Date. Within the limits
set forth in the first sentence of this clause (a), amounts of Swing Loans
repaid may be reborrowed under this clause (a). Swing Loans are not subject to
a minimum borrowing amount.
(b) In order to request a Swing Loan, the Borrower shall telecopy (or
forward by electronic mail or similar means) to the Administrative Agent a
duly completed request in substantially the form of Exhibit D hereto, setting
forth the requested amount and date of such Swing Loan (a "Swing Loan
36
Request"), to be received by the Administrative Agent not later than 2:00 p.m.
(New York time) on the day of the proposed borrowing. The Administrative Agent
shall promptly notify the Swing Loan Lender of the details of the requested
Swing Loan. Subject to the terms of this Agreement, the Swing Loan Lender may
make a Swing Loan available to the Administrative Agent and, in turn, the
Administrative Agent shall make such amounts available to the Borrower on the
date of the relevant Swing Loan Request. The Swing Loan Lender shall not make
any Swing Loan in the period commencing on the first Business Day after it
receives written notice from the Administrative Agent or any Revolving Credit
Lender that one or more of the conditions precedent contained in Section 3.3
shall not on such date be satisfied, and ending when such conditions are
satisfied. The Swing Loan Lender shall not otherwise be required to determine
that, or take notice whether, the conditions precedent set forth in Section
3.3 hereof have been satisfied in connection with the making of any Swing
Loan.
(c) The Swing Loan Lender shall notify the Administrative Agent in
writing (which writing may be a telecopy or electronic mail) weekly, by no
later than 10:00 a.m. (New York time) on the first Business Day of each week,
of the aggregate principal amount of its Swing Loans then outstanding.
(d) The Swing Loan Lender may demand at any time that each Revolving
Credit Lender pay to the Administrative Agent, for the account of the Swing
Loan Lender, in the manner provided in clause (e) below, such Revolving Credit
Lender's Ratable Portion of all or a portion of the outstanding Swing Loans,
which demand shall be made through the Administrative Agent, shall be in
writing and shall specify the outstanding principal amount of Swing Loans
demanded to be paid.
(e) The Administrative Agent shall forward each notice referred to in
clause (c) above and each demand referred to in clause (d) above to each
Revolving Credit Lender on the day such notice or such demand is received by
the Administrative Agent (except that any such notice or demand received by
the Administrative Agent after 2:00 p.m. (New York time) on any Business Day
or any such demand received on a day that is not a Business Day shall not be
required to be forwarded to the Revolving Credit Lenders by the Administrative
Agent until the next succeeding Business Day), together with a statement
prepared by the Administrative Agent specifying the amount of each Revolving
Credit Lender's Ratable Portion of the aggregate principal amount of the Swing
Loans stated to be outstanding in such notice or demanded to be paid pursuant
to such demand, and, notwithstanding whether or not the conditions precedent
set forth in Sections 2.1 and 3.3 shall have been satisfied (which conditions
precedent the Revolving Credit Lenders hereby irrevocably waive), each
Revolving Credit Lender shall, before 11:00 a.m. (New York time) on the
Business Day next succeeding the date of such Revolving Credit Lender's
receipt of such notice or demand, make available to the Administrative Agent,
in immediately available funds, for the account of the Swing Loan Lender, the
amount specified in such statement. Upon such payment by a Revolving Credit
Lender, such Revolving Credit Lender shall, except as provided in clause (f)
below, be deemed to have made a Revolving Loan to the Borrower. The
Administrative Agent shall use such funds to repay the Swing Loans to the
Swing Loan Lender. To the extent that any Revolving Credit Lender fails to
make such payment available to the Administrative Agent for the account of the
Swing Loan Lender, the Borrower shall repay such Swing Loan on demand.
(f) Upon the occurrence of any Default, each Revolving Credit Lender
shall acquire, without recourse or warranty, an undivided participation in
each Swing Loan otherwise required to be repaid by such Revolving Credit
Lender pursuant to clause (e) above, which participation shall be in a
principal amount equal to such Revolving Credit Lender's Ratable Portion of
37
such Swing Loan, by paying to the Swing Loan Lender on the date on which such
Revolving Credit Lender would otherwise have been required to make a payment
in respect of such Swing Loan pursuant to clause (e) above, in immediately
available funds, an amount equal to such Revolving Credit Lender's Ratable
Portion of such Swing Loan. If all or part of such amount is not in fact made
available by such Revolving Credit Lender to the Swing Loan Lender on such
date, the Swing Loan Lender shall be entitled to recover any such unpaid
amount on demand from such Revolving Credit Lender together with interest
accrued from such date at the Federal Funds Rate for the first Business Day
after such payment was due and thereafter at the rate of interest then
applicable to Base Rate Loans.
(g) From and after the date on which any Revolving Credit Lender (i)
is deemed to have made a Revolving Loan pursuant to clause (e) above with
respect to any Swing Loan or (ii) purchases an undivided participation in a
Swing Loan pursuant to clause (f) above, the Swing Loan Lender shall promptly
distribute to such Revolving Credit Lender such Revolving Credit Lender's
Ratable Portion of all payments of principal of and interest received by the
Swing Loan Lender on account of such Swing Loan other than those received from
a Revolving Credit Lender pursuant to clause (e) or (f) above.
Section 2.4. Letters of Credit.
-----------------
(a) On the terms and subject to the conditions contained in this
Agreement, each Issuer agrees to Issue at the request of the Borrower and for
the account of the Borrower one or more Letters of Credit from time to time on
any Business Day during the period commencing on the Closing Date and ending
on the earlier of the Revolving Credit Termination Date and 30 days prior to
the Scheduled Termination Date; provided, however, that no Issuer shall be
under any obligation to Issue (and, upon the occurrence of any of the events
described in clauses (ii), (iii), (iv), (v) and (vi)(A) below, shall not
Issue) any Letter of Credit upon the occurrence of any of the following:
(i) any order, judgment or decree of any Governmental Authority
or arbitrator shall purport by its terms to enjoin or restrain such
Issuer from Issuing such Letter of Credit or any Requirement of Law
applicable to such Issuer or any request or directive (whether or not
having the force of law) from any Governmental Authority with
jurisdiction over such Issuer shall prohibit, or request that such
Issuer refrain from, the Issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon such Issuer
with respect to such Letter of Credit any restriction or reserve or
capital requirement (for which such Issuer is not otherwise
compensated) not in effect on the date of this Agreement or result in
any unreimbursed loss, cost or expense that was not applicable, in
effect or known to such Issuer as of the date of this Agreement and
that such Issuer in good xxxxx xxxxx material to it;
(ii) such Issuer shall have received any written notice of the
type described in clause (d) below;
(iii) after giving effect to the Issuance of such Letter of
Credit, the aggregate Revolving Credit Outstandings would exceed the
Maximum Credit at such time;
(iv) after giving effect to the Issuance of such Letter of
Credit, the sum of (i) the Letter of Credit Undrawn Amounts at such
time and (ii) the Reimbursement Obligations at such time exceeds the
Letter of Credit Sublimit; or
38
(v) such Letter of Credit is requested to be denominated in any
currency other than Dollars; or
(vi) (A) any fees due in connection with a requested Issuance
have not been paid, (B) such Letter of Credit is requested to be
Issued in a form that is not reasonably acceptable to such Issuer or
(C) the Issuer for such Letter of Credit shall not have received, in
form and substance reasonably acceptable to it and, if applicable,
duly executed by such Borrower, applications, agreements and other
documentation (collectively, a "Letter of Credit Reimbursement
Agreement") such Issuer generally employs in the ordinary course of
its business for the Issuance of letters of credit of the type of
such Letter of Credit.
None of the Lenders (other than the Issuers in their capacity as such) shall
have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i)
be more than one year after the date of issuance thereof, or (ii) unless cash
collateralized in the manner set forth in Section 9.3 in an amount equal to
105% of the Letter of Credit Obligations for such Letter of Credit on the date
of Issuance thereof and at all times thereafter while such Letter of Credit is
outstanding, be less than seven days prior to the Scheduled Termination Date;
provided, however, that any Letter of Credit with a term less than or equal to
one year may provide for the renewal thereof for additional periods less than
or equal to one year, as long as, (x) on or before the expiration of each such
term and each such period, the Borrower and the Issuer of such Letter or
Credit shall have the option to prevent such renewal and (y) the Borrower
shall not permit any such renewal to extend the expiration date of any Letter
beyond the date set forth in clause (ii) above.
(c) In connection with the Issuance of each Letter of Credit, the
Borrower shall give the relevant Issuer and the Administrative Agent at least
two Business Days' prior written notice, in substantially the form of Exhibit
E (or in such other written or electronic form as is acceptable to the
Issuer), of the requested Issuance of such Letter of Credit (a "Letter of
Credit Request"). Such notice shall be irrevocable and shall specify the
Issuer of such Letter of Credit, the face amount of the Letter of Credit
requested, which face amount shall not be less than $100,000, the date of
Issuance of such requested Letter of Credit, the date on which such Letter of
Credit is to expire (which date shall be a Business Day), and, in the case of
an Issuance, the Person for whose benefit the requested Letter of Credit is to
be issued. Such notice, to be effective, must be received by the relevant
Issuer and the Administrative Agent not later than 11:00 a.m. (New York time)
on the second Business Day prior to the requested Issuance of such Letter of
Credit.
(d) Subject to the satisfaction of the conditions set forth in this
Section 2.4, the relevant Issuer shall, on the requested date, Issue a Letter
of Credit on behalf of the Borrower in accordance with such Issuer's usual and
customary business practices. No Issuer shall Issue any Letter of Credit in
the period commencing on the first Business Day after it receives written
notice from any Revolving Credit Lender that one or more of the conditions
precedent contained in Section 3.3 (Conditions Precedent to Each Loan and
Letter of Credit) or clause (a) above (other than those conditions set forth
in clauses (a)(i), (a)(vi)(B) and (C) above and, to the extent such clause
relates to fees owing to the Issuer of such Letter of Credit and its
Affiliates, clause (a)(vi)(A) above) are not on such date satisfied or duly
waived and ending when such conditions are satisfied or duly waived. No Issuer
shall otherwise be required to determine that, or take notice whether, the
conditions precedent set forth in Section 3.3 (Conditions Precedent to Each
39
Loan and Letter of Credit) have been satisfied in connection with the Issuance
of any Letter of Credit.
(e) The Borrower agrees that, if requested by the Issuer of any
Letter of Credit shall execute a Letter of Credit Reimbursement Agreement in
respect of any Letter of Credit Issued hereunder. In the event of any conflict
between the terms of any Letter of Credit Reimbursement Agreement and this
Agreement, the terms of this Agreement shall govern.
(f) Each Issuer shall comply with the following:
(i) give the Administrative Agent written notice (or telephonic
notice confirmed promptly thereafter in writing), which writing may
be a telecopy or electronic mail, of the Issuance of any Letter of
Credit Issued by it, of all drawings under any Letter of Credit
Issued by it and of the payment (or the failure to pay when due) by
the Borrower of any Reimbursement Obligation when due (which notice
the Administrative Agent shall promptly transmit by telecopy,
electronic mail or similar transmission to each Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to
such Revolving Credit Lender copies of any Letter of Credit
Reimbursement Agreement to which such Issuer is a party and such
other documentation as may reasonably be requested by such Revolving
Credit Lender; and
(iii) no later than 10 Business Days following the last day of
each calendar month, provide to the Administrative Agent (and the
Administrative Agent shall provide a copy to each Lender requesting
the same) and the Borrower separate schedules for Documentary Letters
of Credit and Standby Letters of Credit issued by it, in form and
substance reasonably satisfactory to the Administrative Agent,
setting forth the aggregate Letter of Credit Obligations, in each
case outstanding at the end of each month, and any information
requested by the Borrower or the Administrative Agent relating
thereto.
(g) Immediately upon the Issuance by an Issuer of a Letter of Credit
in accordance with the terms and conditions of this Agreement, such Issuer
shall be deemed to have sold and transferred to each Revolving Credit Lender,
and each Revolving Credit Lender shall be deemed irrevocably and
unconditionally to have purchased and received from such Issuer, without
recourse or warranty, an undivided interest and participation, to the extent
of such Revolving Credit Lender's Ratable Portion, in such Letter of Credit
and the obligations of the Borrower with respect thereto (including all Letter
of Credit Obligations with respect thereto) and any security therefor and
guaranty pertaining thereto.
(h) The Borrower agrees to pay to the Issuer of any Letter of Credit
the amount of all Reimbursement Obligations owing to such Issuer under any
Letter of Credit issued for its account no later than the date that is the
next succeeding Business Day after the Borrower receives written notice from
such Issuer that payment has been made under such Letter of Credit (the
"Reimbursement Date"), irrespective of any claim, set-off, defense or other
right that the Borrower may have at any time against such Issuer or any other
Person. In the event that any Issuer makes any payment under any Letter of
Credit and the Borrower shall not have repaid such amount to such Issuer
pursuant to this clause (h) or any such payment by the Borrower is rescinded
or set aside for any reason, such Reimbursement Obligation shall be payable on
demand with interest thereon computed (i) from the date on which such
Reimbursement Obligation arose to the Reimbursement Date, at the rate of
interest applicable during such period to Revolving Loans that are Base Rate
40
Loans and (ii) from the Reimbursement Date until the date of repayment in
full, at the rate of interest applicable during such period to past due
Revolving Loans that are Base Rate Loans, and such Issuer shall promptly
notify the Administrative Agent, which shall promptly notify each Revolving
Credit Lender of such failure, and each Revolving Credit Lender shall promptly
and unconditionally pay to the Administrative Agent for the account of such
Issuer the amount of such Revolving Credit Lender's Ratable Portion of such
payment in Dollars and in immediately available funds. If the Administrative
Agent so notifies such Revolving Credit Lender prior to 11:00 a.m. (New York
time) on any Business Day, such Revolving Credit Lender shall make available
to the Administrative Agent for the account of such Issuer its Ratable Portion
of the amount of such payment on such Business Day in immediately available
funds. Upon such payment by a Revolving Credit Lender, such Revolving Credit
Lender shall, notwithstanding whether or not the conditions precedent set
forth in Section 3.3 shall have been satisfied (which conditions precedent the
Revolving Credit Lenders hereby irrevocably waive), be deemed to have made a
Revolving Loan to the Borrower in the principal amount of such payment.
Whenever any Issuer receives from the Borrower a payment of a Reimbursement
Obligation as to which the Administrative Agent has received for the account
of such Issuer any payment from a Revolving Credit Lender pursuant to this
clause (h), such Issuer shall pay over to the Administrative Agent any amount
received in excess of such Reimbursement Obligation and, upon receipt of such
amount, the Administrative Agent shall promptly pay over to each Revolving
Credit Lender, in immediately available funds, an amount equal to such
Revolving Credit Lender's Ratable Portion of the amount of such payment
adjusted, if necessary, to reflect the respective amounts the Revolving Credit
Lenders have paid in respect of such Reimbursement Obligation.
(i) If and to the extent such Revolving Credit Lender shall not have
so made its Ratable Portion of the amount of the payment required by clause
(h) above available to the Administrative Agent for the account of such
Issuer, such Revolving Credit Lender agrees to pay to the Administrative Agent
for the account of such Issuer forthwith on demand any such unpaid amount
together with interest thereon, for the first Business Day after payment was
first due at the Federal Funds Rate and, thereafter, until such amount is
repaid to the Administrative Agent for the account of such Issuer, at a rate
per annum equal to the rate applicable to Base Rate Loans under the Facility.
(j) The Borrower's obligation to pay each Reimbursement Obligation
and the obligations of the Revolving Credit Lenders to make payments to the
Administrative Agent for the account of the Issuers with respect to Letters of
Credit shall be absolute, unconditional and irrevocable, and shall be
performed strictly in accordance with the terms of this Agreement, under any
and all circumstances whatsoever, including the occurrence of any Default or
Event of Default, and irrespective of any of the following:
(i) any lack of validity or enforceability of any Letter of
Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from
all or any of the provisions of any Letter of Credit or any Loan
Document;
(iii) the existence of any claim, set off, defense or other
right that the Borrower, any other party guaranteeing, or otherwise
obligated with, the Borrower, any Subsidiary or other Affiliate
thereof or any other Person may at any time have against the
beneficiary under any Letter of Credit, any Issuer, the
Administrative Agent or any Lender or any other Person, whether in
41
connection with this Agreement, any other Loan Document or any other
related or unrelated agreement or transaction;
(iv) any draft or other document presented under a Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in
any respect;
(v) payment by the Issuer under a Letter of Credit against
presentation of a draft or other document that does not comply with
the terms of such Letter of Credit; and
(vi) any other act or omission to act or delay of any kind of
the Issuer, the Lenders, the Administrative Agent or any other Person
or any other event or circumstance whatsoever, whether or not similar
to any of the foregoing, that might, but for the provisions of this
Section 2.4, constitute a legal or equitable discharge of the
Borrower's obligations hereunder.
Any action taken or omitted to be taken by the relevant Issuer under or in
connection with any Letter of Credit, if taken or omitted in the absence of
gross negligence or willful misconduct, shall not result in any liability of
such Issuer to the Borrower or any Lender. In determining whether drafts and
other documents presented under a Letter of Credit comply with the terms
thereof, the Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary and, in making any payment under any
Letter of Credit, the Issuer may rely exclusively on the documents presented
to it under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary thereunder equals the
amount of such draft and whether or not any document presented pursuant to
such Letter of Credit proves to be insufficient in any respect, if such
document on its face appears to be in order, and whether or not any other
statement or any other document presented pursuant to such Letter of Credit
proves to be forged or invalid or any statement therein proves to be
inaccurate or untrue in any respect whatsoever and any noncompliance in any
immaterial respect of the documents presented under such Letter of Credit with
the terms thereof shall, in each case, be deemed not to constitute willful
misconduct or gross negligence of the Issuer.
Section 2.5. Reduction and Termination of the Revolving Credit
Commitments.
-------------------------------------------------
(a) The Borrower may, upon at least three Business Days' prior notice
to the Administrative Agent, terminate in whole or reduce in part ratably the
unused portions of the respective Revolving Credit Commitments of the
Revolving Credit Lenders; provided, however, that each partial reduction shall
be in an aggregate amount of not less than $5,000,000 or an integral multiple
of $1,000,000 in excess thereof.
(b) If the Incremental Facility Effective Date shall not have
occurred on or before April 30, 2005, the aggregate Revolving Credit
Commitments shall automatically and permanently be reduced to the Interim
Facility Commitment Amount on April 30, 2005 (and the Revolving Credit
Commitment of each Revolving Credit Lender shall be reduced by its Ratable
Portion of such amount).
42
Section 2.6. Repayment of Loans. The Borrower promises to repay the
entire unpaid principal amount of the Revolving Loans and the Swing Loans on
the Scheduled Termination Date or earlier, if otherwise required by the terms
hereof.
Section 2.7. Evidence of Debt.
----------------
(a) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing Indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.
(b) The Administrative Agent shall maintain accounts in accordance
with its usual practice in which it shall record (i) the amount of each Loan
made and, if a Eurodollar Rate Loan, the Interest Period applicable thereto,
(ii) the amount of any principal or interest due and payable by the Borrower
to each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder from the Borrower, whether such sum constitutes
principal or interest (and the type of Loan to which it applies), fees,
expenses or other amounts due under the Loan Documents and each Lender's share
thereof, if applicable.
(c) The entries made in the accounts maintained pursuant to clauses
(a) and (b) above shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations recorded
therein; provided, however, that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not
in any manner affect the obligations of the Borrower to repay the Loans in
accordance with their terms.
(d) Notwithstanding any other provision of the Agreement, in the
event that any Revolving Credit Lender requests that the Borrower execute and
deliver a promissory note or notes payable to such Revolving Credit Lender in
order to evidence the Indebtedness owing to such Revolving Credit Lender by
the Borrower hereunder, the Borrower shall promptly execute and deliver a
Revolving Credit Note or Revolving Credit Notes to such Revolving Credit
Lender evidencing the Revolving Loans of such Revolving Credit Lender,
substantially in the form of Exhibit B.
Section 2.8. Optional Prepayments. The Borrower may prepay the
outstanding principal amount of the Revolving Loans and Swing Loans in whole
or in part at any time; provided, however, that if any prepayment of any
Eurodollar Rate Loan is made by the Borrower other than on the last day of an
Interest Period for such Loan, the Borrower shall also pay any amount owing
pursuant to Section 2.14.
Section 2.9. Mandatory Prepayments.
---------------------
(a) Upon receipt by the Borrower or any of its Subsidiaries of Net
Cash Proceeds arising from an Asset Sale, Property Loss Event, Debt Issuance,
Equity Issuance, Commercial Tort Claim or Avoidance Action, the Borrower shall
within one Business Day (or, in the case of Asset Sales, within three Business
Days) of receipt of such Net Cash Proceeds prepay the Loans (and as applicable
pursuant to clause (b) below, provide cash collateral in respect of Letters of
Credit) in an amount equal to 100% of such Net Cash Proceeds. Any such
mandatory prepayment shall be applied in accordance with clause (b) below;
provided, however, that, in the case of any Net Cash Proceeds arising from a
Reinvestment Event, the Borrower shall (i) immediately upon receipt of such
Net Cash Proceeds, at the Borrower's option, deposit 100% of such Net Cash
Proceeds in a Cash Collateral Account or prepay the Loans (or provide cash
43
collateral in respect of Letters of Credit), which prepayment shall be applied
as provided in clause (b) below, in an amount equal to 100% of such Net Cash
Proceeds and (ii) prepay the Loans (or provide cash collateral in respect of
Letters of Credit) in an amount equal to the Reinvestment Prepayment Amount
applicable to such Reinvestment Event, if any, on the Reinvestment Prepayment
Date with respect to such Reinvestment Event.
(b) Subject to the provisions of Section 2.13(g), any prepayments
made by the Borrower required to be applied in accordance with this clause (b)
shall be applied as follows: first, to repay the outstanding principal balance
of the Swing Loans until such Swing Loans shall have been repaid in full;
second, to repay the outstanding principal balance of the Revolving Loans
until such Revolving Loans shall have been paid in full; and then, if a
Default or Event of Default has occurred and is continuing and only for so
long as the same is in effect, to provide cash collateral for any Letter of
Credit Obligations in an amount equal to 105% of such Letter of Credit
Obligations in the manner set forth in Section 9.3 until all such Letter of
Credit Obligations have been fully cash collateralized in the manner set forth
therein. No repayments of Revolving Loans and Swing Loans or cash
collateralization of Letters of Credit required to be made pursuant to this
Section 2.9 (including in the case of Net Cash Proceeds arising from a
Reinvestment Event, the application of such proceeds to the Revolving Loans
and Swing Loans pending reinvestment thereof by the applicable Loan Party)
shall result in a reduction of the Revolving Credit Commitments.
(c) If at any time, the aggregate principal amount of Revolving
Credit Outstandings exceeds the aggregate Maximum Credit at such time, the
Borrower shall forthwith prepay the Swing Loans first and then the Revolving
Loans then outstanding in an amount equal to such excess. If any such excess
remains after repayment in full of the aggregate outstanding Swing Loans and
Revolving Loans, the Borrower shall provide cash collateral for the Letter of
Credit Obligations in the manner set forth in Section 9.3 in an amount equal
to 105% of such excess, such cash collateral to be released to the extent the
Revolving Credit Outstandings thereafter no longer exceed the Maximum Credit.
(d) The Borrower hereby irrevocably waives the right to direct the
application of all funds in the Cash Concentration Account or any other Cash
Collateral Account (other than an amount equal to any proceeds arising from a
Reinvestment Event that are held in a Cash Collateral Account pending
application of such proceeds as specified in a Reinvestment Notice) so long as
the Administrative Agent applies such funds in accordance with this Agreement
and agrees that the Administrative Agent shall, except as provided in Section
2.13(g) (Payments and Computations) and clause (c) above, apply all available
funds in the Cash Concentration Account or any other Cash Collateral Account
on a daily basis and, prior to the establishment of the cash management
provisions set forth in Section 7.12 (but subject to the proviso set forth in
Section 7.12(a)), the Borrower shall cause cleared cash in any other deposit
account of the Borrower or any Subsidiary Guarantor to be applied on a daily
basis, as follows: first, to repay the outstanding principal amount of the
Swing Loans until such Swing Loans have been repaid in full; second, to repay
the outstanding principal balance of the Revolving Loans until such Revolving
Loans shall have been repaid in full; and then to any other Obligation then
due and payable. Any such repayment of the Swing Loans and Revolving Loans
shall not result in a corresponding reduction of the Revolving Credit
Commitments. The Administrative Agent agrees so to apply such funds and the
Borrower consents to such application. If (i) following such application or
(ii) after all Letters of Credit shall have expired or be fully drawn and all
Revolving Credit Commitments shall have been terminated, there are no Loans
outstanding and no other Obligations that are then due and payable, then the
Administrative Agent shall cause any remaining funds in the Cash Concentration
Account or any other Cash Collateral Account to be paid at the written
direction of the Borrower (or, in the absence of such direction, to the
44
Borrower or another Person lawfully entitled thereto). Notwithstanding any of
the other provisions of this clause (d), so long as no Event of Default shall
have occurred and be continuing, if any prepayment of Revolving Loans is
required to be made under this clause (d) prior to the last day of the
Interest Period therefor, the Borrower may, in its sole discretion, deposit
the amount of any such prepayment otherwise required to be made thereunder
into a Cash Collateral Account until the last day of such Interest Period, at
which time the Administrative Agent shall be authorized (without any further
action by or notice to or from the Borrower or any other Loan Party) to apply
such amount to the prepayment of such Revolving Loans in accordance with this
clause (d). Upon the occurrence and during the continuance of any Event of
Default, the Administrative Agent shall also be authorized (without any
further action by or notice to or from the Borrower or any other Loan Party)
to apply such amount to the prepayment of such Revolving Loans in accordance
with this clause (d).
Section 2.10. Interest.
--------
(a) Rate of Interest. All Loans and the outstanding amount of all
other Obligations shall bear interest, in the case of Loans, on the unpaid
principal amount thereof from the date such Loans are made and, in the case of
such other Obligations, from the date such other Obligations are due and
payable until, in all cases, paid in full, except as otherwise provided in
Section 2.10(c), as follows:
(i) if a Base Rate Loan or such other Obligation, at a rate per
annum equal to the sum of (A) the Base Rate as in effect from time to
time, and (B) the Applicable Margin; and
(ii) if a Eurodollar Rate Loan, at a rate per annum equal to the
sum of (A) the Eurodollar Rate determined for the applicable Interest
Period, and (B) the Applicable Margin in effect from time to time
during such Interest Period.
(b) Interest Payments. (i) Interest accrued on each Base Rate Loan
(other than Swing Loans) shall be payable in arrears (A) on the first Business
Day of each calendar quarter, commencing on the first such day following the
making of such Base Rate Loan, and (B) if not previously paid in full, at
maturity (whether by acceleration or otherwise) of such Base Rate Loan; (ii)
interest accrued on Swing Loans shall be payable in arrears on the first
Business Day of the immediately succeeding calendar quarter; (iii) interest
accrued on each Eurodollar Rate Loan shall be payable in arrears (A) on the
last day of each Interest Period applicable to such Loan and if such Interest
Period has a duration of more than three months, on each date during such
Interest Period occurring every three months from the first day of such
Interest Period, (B) upon the payment or prepayment thereof in full or in
part, and (C) if not previously paid in full, at maturity (whether by
acceleration or otherwise) of such Eurodollar Rate Loan; and (iv) interest
accrued on the amount of all other Obligations shall be payable on demand from
and after the time such Obligation becomes due and payable (whether by
acceleration or otherwise).
(c) Default Interest. Notwithstanding the rates of interest specified
in Section 2.10(a) or elsewhere herein, effective immediately upon the
occurrence of an Event of Default, and for as long thereafter as such Event of
Default shall be continuing, the principal balance of all Loans and the amount
of all other Obligations then due and payable shall bear interest at a rate
that is two percent per annum in excess of the rate of interest applicable to
such Loans or other Obligations from time to time. Such interest shall be
payable on demand.
45
Section 2.11. Conversion/Continuation Option.
------------------------------
(a) The Borrower may elect (i) at any time on any Business Day to
convert Base Rate Loans (other than Swing Loans) or any portion thereof to
Eurodollar Rate Loans, and (ii) at the end of any applicable Interest Period,
to convert Eurodollar Rate Loans or any portion thereof into Base Rate Loans
or to continue such Eurodollar Rate Loans or any portion thereof for an
additional Interest Period; provided, however, that the aggregate amount of
the Eurodollar Loans for each Interest Period must be in the amount of at
least $1,000,000 or an integral multiple of $500,000 in excess thereof. Each
conversion or continuation shall be allocated among the Loans of each
Revolving Credit Lender in accordance with such Revolving Credit Lender's
Ratable Portion. Each such election shall be in substantially the form of
Exhibit G hereto (a "Notice of Conversion or Continuation") and shall be made
by giving the Administrative Agent at least three Business Days' prior written
notice specifying (A) the amount and type of Loan being converted or
continued, (B) in the case of a conversion to or a continuation of Eurodollar
Rate Loans, the applicable Interest Period, and (C) in the case of a
conversion, the date of such conversion.
(b) The Administrative Agent shall promptly notify each Lender of its
receipt of a Notice of Conversion or Continuation and of the options selected
therein. Notwithstanding the foregoing, no conversion in whole or in part of
Base Rate Loans to Eurodollar Rate Loans, and no continuation in whole or in
part of Eurodollar Rate Loans upon the expiration of any applicable Interest
Period, shall be permitted at any time at which (i) an Event of Default shall
have occurred and be continuing or (ii) the continuation of, or conversion
into, a Eurodollar Loan would violate any provision of Section 2.14. If,
within the time period required under the terms of this Section 2.11, the
Administrative Agent does not receive a Notice of Conversion or Continuation
from the Borrower containing a permitted election to continue any Eurodollar
Rate Loans for an additional Interest Period or to convert any such Loans,
then, upon the expiration of the applicable Interest Period, such Loans shall
be automatically converted to Base Rate Loans. Each Notice of Conversion or
Continuation shall be irrevocable.
Section 2.12. Fees.
----
(a) Unused Commitment Fee. The Borrower agrees to pay in immediately
available Dollars to each Revolving Credit Lender a commitment fee on the
actual daily amount by which (i) (A) prior to the Incremental Facility
Effective Date, the Ratable Portion of the Interim Facility Commitment Amount
of such Revolving Facility Lender, or (B) on and after the Incremental
Facility Effective Date, the Revolving Credit Commitment of such Revolving
Credit Lender, in either case exceeds (ii) such Revolving Credit Lender's
Ratable Portion of the sum of (x) the aggregate outstanding principal amount
of Revolving Loans and (y) the outstanding amount of the aggregate Letter of
Credit Obligations (the "Unused Commitment Fee") from the date hereof through
the Revolving Credit Termination Date at the Applicable Unused Commitment Fee
Rate, payable in arrears (i) on the first Business Day of each calendar
quarter, commencing on the first such Business Day following the Closing Date
and (ii) on the Revolving Credit Termination Date.
(b) Letter of Credit Fees. The Borrower agrees to pay the following
amounts with respect to Letters of Credit issued by any Issuer:
(i) to the Administrative Agent for the account of each Issuer
of a Letter of Credit, with respect to each Letter of Credit issued
by such Issuer, an issuance fee equal to 0.25% per annum (or such
other rate as may be agreed upon between the Borrower and such
Issuer) of the maximum withdrawn face amount of such Letter of
46
Credit, payable in arrears (A) on the first Business Day of each
calendar quarter, commencing on the first such Business Day following
the issuance of such Letter of Credit and (B) on the Revolving Credit
Termination Date;
(ii) to the Administrative Agent for the ratable benefit of the
Revolving Credit Lenders, with respect to each Letter of Credit, a
fee accruing at a rate per annum equal to the Applicable Margin for
Revolving Loans that are Eurodollar Rate Loans of the maximum
withdrawn face amount available of such Letter of Credit, payable in
arrears on the first Business Day of each calendar quarter,
commencing on the first such Business Day following the issuance of
such Letter of Credit and (ii) on the Revolving Credit Termination
Date; provided, however, that during the continuance of an Event of
Default, such fee shall be increased by two percent per annum
(instead of, and not in addition to, any increase pursuant to Section
2.16(c) and shall be payable on demand; and
(iii) to the Issuer of any Letter of Credit, with respect to the
issuance, amendment or transfer of each Letter of Credit and each
drawing made thereunder, documentary and processing charges in
accordance with such Issuer's standard schedule for such charges in
effect at the time of issuance, amendment, transfer or drawing, as
the case may be.
(c) Additional Fees. The Borrower has agreed to pay to the
Administrative Agent and the Arranger additional fees, the amount and dates of
payment of which are embodied in the Fee Letter.
Section 2.13. Payments and Computations.
-------------------------
(a) The Borrower shall make each payment hereunder (including fees
and expenses) not later than 1:00 p.m. (New York time) on the day when due, in
Dollars, to the Administrative Agent at its address referred to in Section
13.8 in immediately available funds without set-off or counterclaim. The
Administrative Agent shall promptly thereafter cause to be distributed
immediately available funds relating to the payment of principal, interest or
fees to the Lenders, in accordance with the application of payments set forth
in clauses (f) or (g) below, as applicable, for the account of their
respective Applicable Lending Offices; provided, however, that amounts payable
pursuant to Section 2.14(c), 2.14(d), 2.15 or 2.16 shall be paid only to the
affected Lender or Lenders and amounts payable with respect to Swing Loans
shall be paid only to the Swing Loan Lender. Payments received by the
Administrative Agent after 1:00 p.m. (New York time) shall be deemed to be
received on the next Business Day.
(b) All computations of interest and of fees shall be made by the
Administrative Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest and fees are payable. Each
determination by the Administrative Agent of a rate of interest hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(c) If and to the extent any payment owed to the Administrative Agent
or any Lender is not made when due, each Loan Party hereby authorizes the
Administrative Agent and such Lender, subject to any notice period provided in
the Orders, to setoff and charge any amount so due against any deposit account
maintained by such Loan Party with the Administrative Agent or such Lender,
whether or not the deposit therein is then due.
47
(d) Whenever any payment hereunder shall be stated to be due on a day
other than a Business Day, the due date for such payment shall be extended to
the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or fees, as the
case may be; provided, however, that if such extension would cause payment of
interest on or principal of any Eurodollar Rate Loan to be made in the next
calendar month, such payment shall be made on the immediately preceding
Business Day. All repayments of any Revolving Loans shall be applied as
follows: first, to repay such Loans outstanding as Base Rate Loans and then,
to repay such Loans outstanding as Eurodollar Rate Loans, with those
Eurodollar Rate Loans having earlier expiring Eurodollar Interest Periods
being repaid prior to those having later expiring Eurodollar Interest Periods.
(e) Unless the Administrative Agent shall have received notice from
the Borrower to the Lenders prior to the date on which any payment is due
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent
may, in reliance upon such assumption, cause to be distributed to each Lender
on such due date an amount equal to the amount then due such Lender. If and to
the extent that the Borrower shall not have made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon at the Federal Funds Rate, for the first Business Day, and,
thereafter, at the rate applicable to Base Rate Loans, for each day from the
date such amount is distributed to such Lender until the date such Lender
repays such amount to the Administrative Agent.
(f) Except for payments and other amounts received by the
Administrative Agent and applied in accordance with the provisions of clause
(g) below (or required to be applied in accordance with Section 2.9(b) or (d)
(Mandatory Prepayments)), all payments and any other amounts received by the
Administrative Agent from or for the benefit of the Borrower shall be applied
as follows: first, to pay principal of and interest on any portion of the
Loans the Administrative Agent may have advanced pursuant to the express
provisions of this Agreement on behalf of any Lender, for which the
Administrative Agent has not then been reimbursed by such Lender or the
Borrower; second, to pay all other Obligations then due and payable; and
third, as the Borrower so designates. Payments in respect of Swing Loans
received by the Administrative Agent shall be distributed to the Swing Loan
Lender; payments in respect of Revolving Loans received by the Administrative
Agent shall be distributed to each Revolving Credit Lender in accordance with
such Revolving Credit Lender's Ratable Portion; and all payments of fees and
all other payments in respect of any other Obligation shall be allocated among
such of the Lenders and Issuers as are entitled thereto, and, for payments
allocated to the Revolving Credit Lenders, in proportion to their respective
Ratable Portions.
(g) The Borrower hereby irrevocably waives the right to direct the
application of any and all payments in respect of the Obligations and any
proceeds of Collateral after the occurrence and during the continuance of an
Event of Default and agrees that, notwithstanding the provisions of Section
2.9(b) (Mandatory Prepayments) and clause (f) above but subject only to any
requirements of the giving of notice by the terms of the Interim Order or the
Final Order, the Administrative Agent may, and upon either (A) the written
direction of the Requisite Lenders or (B) the acceleration of the Obligations
pursuant to Section 9.2, shall deliver a Blockage Notice for each Deposit
Account Bank for each Approved Deposit Account and apply all payments in
respect of any Obligations and all funds on deposit in any Cash Collateral
Account (including all proceeds arising from a Reinvestment Event that are
held in the Cash Collateral Account pending application of such proceeds as
48
specified in a Reinvestment Notice) and all other proceeds of Collateral in
the following order:
(i) first, to pay interest on and then principal of any portion
of the Revolving Loans that the Administrative Agent may have
advanced on behalf of any Lender for which the Administrative Agent
has not then been reimbursed by such Lender or the Borrower;
(ii) second, to pay Secured Obligations in respect of any
expense reimbursements or indemnities and Cash Management Obligations
then due to the Administrative Agent;
(iii) third, to pay Secured Obligations in respect of any
expense reimbursements or indemnities and Cash Management Obligations
then due to the Lenders and the Issuers;
(iv) fourth, to pay Secured Obligations in respect of any fees
then due to the Administrative Agent, the Lenders and the Issuers;
(v) fifth, to pay interest then due and payable in respect of
the Loans and Reimbursement Obligations;
(vi) sixth, to pay or prepay principal amounts on the Loans and
Reimbursement Obligations, and to provide cash collateral for
outstanding Letter of Credit Undrawn Amounts in the manner described
in Section 9.3, and to any Cash Management Obligations and amounts
owing with respect to Hedging Contracts, ratably to the aggregate
principal amount of such Loans, Reimbursement Obligations and Letter
of Credit Undrawn Amounts, Cash Management Obligations and
Obligations owing with respect to Hedging Contracts; and
(vii) seventh, to the ratable payment of all other Secured
Obligations;
provided, however, that if sufficient funds are not available to fund all
payments to be made in respect of any Secured Obligation described in any of
clauses (i), (ii), (iii), (iv), (v), (vi) and (vii) above the available funds
being applied with respect to any such Secured Obligation (unless otherwise
specified in such clause) shall be allocated to the payment of such Secured
Obligation ratably, based on the proportion of the Administrative Agent's and
each Lender's or Issuer's interest in the aggregate outstanding Secured
Obligations described in such clauses; provided, further, that payments that
would otherwise be allocated to the Revolving Credit Lenders shall be
allocated first to repay Protective Advances and Swing Loans pro rata and then
to the Revolving Credit Lenders. The order of priority set forth in clauses
(i), (ii), (iii), (iv), (v), (vi) and (vii) above may at any time and from
time to time be changed by the agreement of the Requisite Lenders without
necessity of notice to or consent of or approval by the Borrower, any Secured
Party that is not a Lender or Issuer or by any other Person that is not a
Lender or Issuer. The order of priority set forth in clauses (i), (ii), (iii)
and (iv) above may be changed only with the prior written consent of the
Administrative Agent in addition to that of the Requisite Lenders.
(h) At the option of the Administrative Agent, principal on the Swing
Loans, Reimbursement Obligations, interest, fees, expenses and other sums due
and payable in respect of the Revolving Loans and Protective Advances may be
paid from the proceeds of Swing Loans or Revolving Loans. The Borrower hereby
authorizes the Swing Loan Lender to make such Swing Loans pursuant to Section
49
2.3(a), and the Revolving Credit Lenders to make such Revolving Loans pursuant
to Section 2.2(a), from time to time in the amounts of any and all principal
payable with respect to the Swing Loans Reimbursement Obligations, interest,
fees, expenses and other sums payable in respect of the Revolving Loans and
Protective Advances, and further authorizes the Administrative Agent to give
the Lenders notice of any Borrowing with respect to such Swing Loans and
Revolving Loans and to distribute the proceeds of such Swing Loans and
Revolving Loans to pay such amounts. The Borrower agrees that all such Swing
Loans and Revolving Loans so made shall be deemed to have been requested by it
(irrespective of the satisfaction of the conditions in Section 3.3, which
conditions the Lenders irrevocably waive) and directs that all proceeds
thereof shall be used to pay such amounts.
Section 2.14. Special Provisions Governing Eurodollar Rate Loans.
--------------------------------------------------
(a) Determination of Interest Rate. The Eurodollar Rate for each
Interest Period for Eurodollar Rate Loans shall be determined by the
Administrative Agent pursuant to the procedures set forth in the definition of
"Eurodollar Rate." The Administrative Agent's determination shall be presumed
to be correct, absent manifest error, and shall be binding on the Borrower.
(b) Interest Rate Unascertainable, Inadequate or Unfair. In the event
that (i) the Administrative Agent determines that adequate and fair means do
not exist for ascertaining the applicable interest rates by reference to which
the Eurodollar Rate then being determined is to be fixed or (ii) the Requisite
Lenders notify the Administrative Agent that the Eurodollar Rate for any
Interest Period will not adequately reflect the cost to the Revolving Credit
Lenders of making or maintaining such Loans for such Interest Period, the
Administrative Agent shall forthwith so notify the Borrower and the Revolving
Credit Lenders, whereupon each Eurodollar Loan shall automatically, on the
last day of the current Interest Period for such Loan, convert into a Base
Rate Loan and the obligations of the Revolving Credit Lenders to make
Eurodollar Rate Loans or to convert Base Rate Loans into Eurodollar Rate Loans
shall be suspended until the Administrative Agent shall notify the Borrower
that the Requisite Lenders have determined that the circumstances causing such
suspension no longer exist.
(c) Increased Costs. If at any time any Revolving Credit Lender
determines that the introduction of or any change in or in the interpretation
of any law, treaty or governmental rule, regulation or order (other than any
change by way of imposition or increase of reserve requirements included in
determining the Eurodollar Rate or relating to taxes) or the compliance by
such Revolving Credit Lender with any guideline, request or directive from any
central bank or other Governmental Authority (whether or not having the force
of law), there shall have the effect of increasing the cost to such Revolving
Credit Lender of agreeing to make or making, funding or maintaining any
Eurodollar Rate Loans, then the Borrower shall from time to time, upon demand
by such Revolving Credit Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Revolving Credit Lender additional amounts sufficient to compensate such
Revolving Credit Lender for such increased cost. A certificate as to the
amount of such increased cost, submitted to the Borrower and the
Administrative Agent by such Revolving Credit Lender, shall be conclusive and
binding for all purposes, absent manifest error.
(d) Illegality. Notwithstanding any other provision of this
Agreement, if any Revolving Credit Lender determines that the introduction of
or any change in or in the interpretation of any law, treaty or governmental
rule, regulation or order after the date of this Agreement shall make it
unlawful, or any central bank or other Governmental Authority shall assert
50
that it is unlawful, for any Revolving Credit Lender or its Eurodollar Lending
Office to make Eurodollar Rate Loans or to continue to fund or maintain
Eurodollar Rate Loans, then, on notice thereof and demand therefor by such
Revolving Credit Lender to the Borrower through the Administrative Agent, (i)
the obligation of such Revolving Credit Lender to make or to continue
Eurodollar Rate Loans and to convert Base Rate Loans into Eurodollar Rate
Loans shall be suspended, and each such Revolving Credit Lender shall make a
Base Rate Loan as part of any requested Borrowing of Eurodollar Rate Loans and
(ii) if the affected Eurodollar Rate Loans are then outstanding, the Borrower
shall immediately convert each such Loan into a Base Rate Loan. If at any time
after a Revolving Credit Lender gives notice under this Section 2.14(d) such
Revolving Credit Lender determines that it may lawfully make Eurodollar Rate
Loans, such Revolving Credit Lender shall promptly give notice of that
determination to the Borrower and the Administrative Agent, and the
Administrative Agent shall promptly transmit the notice to each other Lender.
The Borrower's right to request, and such Revolving Credit Lender's
obligation, if any, to make Eurodollar Rate Loans shall thereupon be restored.
(e) Breakage Costs. In addition to all amounts required to be paid by
the Borrower pursuant to Section 2.10, the Borrower shall compensate each
Revolving Credit Lender, upon demand, for all losses, expenses and liabilities
(including any loss or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Revolving Credit
Lender to fund or maintain such Revolving Credit Lender's Eurodollar Rate
Loans to the Borrower but excluding any loss of the Applicable Margin on the
relevant Loans) that such Revolving Credit Lender may sustain (i) if for any
reason (other than solely by reason of such Lender being a Non-Funding Lender)
a proposed Borrowing, conversion into or continuation of Eurodollar Rate Loans
does not occur on a date specified therefor in a Notice of Borrowing or a
Notice of Conversion or Continuation given by the Borrower or in a telephonic
request by it for borrowing or conversion or continuation or a successive
Interest Period does not commence after notice therefor is given pursuant to
Section 2.11, (ii) if for any reason any Eurodollar Rate Loan is prepaid
(including mandatorily pursuant to Section 2.9) on a date that is not the last
day of the applicable Interest Period, (iii) as a consequence of a required
conversion of a Eurodollar Rate Loan to a Base Rate Loan as a result of any of
the events indicated in Section 2.14(d), or (iv) as a consequence of any
failure by the Borrower to repay Eurodollar Rate Loans when required by the
terms hereof. The Revolving Credit Lender making demand for such compensation
shall deliver to the Borrower concurrently with such demand a written
statement as to such losses, expenses and liabilities, and this statement
shall be conclusive as to the amount of compensation due to such Revolving
Credit Lender, absent manifest error.
Section 2.15. Capital Adequacy. If at any time any Lender determines
that (a) the adoption of or any change in or in the interpretation of any law,
treaty or governmental rule, regulation or order after the date of this
Agreement regarding capital adequacy, (b) compliance with any such law,
treaty, rule, regulation, or order, or (c) compliance with any guideline or
request or directive from any central bank or other Governmental Authority
(whether or not having the force of law) shall have the effect of reducing the
rate of return on such Lender's (or any corporation controlling such Lender's)
capital as a consequence of its obligations hereunder or under or in respect
of any Letter of Credit to a level below that which such Lender or such
corporation could have achieved but for such adoption, change, compliance or
interpretation, then, upon demand from time to time by such Lender (with a
copy of such demand to the Administrative Agent), the Borrower shall pay to
the Administrative Agent for the account of such Lender, from time to time as
specified by such Lender, additional amounts sufficient to compensate such
Lender for such reduction. A certificate as to such amounts submitted to the
Borrower and the Administrative Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error.
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Section 2.16. Taxes.
-----
(a) Any and all payments by any Loan Party under each Loan Document
shall be made free and clear of and without deduction for any and all present
or future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding (i) in the case of each Lender,
Issuer and the Administrative Agent (A) taxes measured by its net income, and
franchise taxes imposed on it, and similar taxes imposed by the jurisdiction
(or any political subdivision thereof) under the laws of which such Lender,
Issuer or the Administrative Agent (as the case may be) is organized and (B)
any United States withholding taxes payable with respect to payments under the
Loan Documents under laws (including any statute, treaty or regulation) in
effect on the Closing Date (or, in the case of an Eligible Assignee, the date
of the Assignment and Acceptance) applicable to such Lender, Issuer or the
Administrative Agent, as the case may be, but not excluding any United States
withholding taxes payable as a result of any change in such laws occurring
after the Closing Date (or the date of such Assignment and Acceptance) and
(ii) in the case of each Lender or Issuer, taxes measured by its net income,
and franchise taxes imposed on it as a result of a present or former
connection between such Lender or Issuer (as the case may be) and the
jurisdiction of the Governmental Authority imposing such tax or any taxing
authority thereof or therein (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred
to as "Taxes"). If any Taxes shall be required by law to be deducted from or
in respect of any sum payable under any Loan Document to any Lender, any
Issuer or the Administrative Agent (W) the sum payable shall be increased as
may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 2.16) such
Lender, Issuer or the Administrative Agent (as the case may be) receives an
amount equal to the sum it would have received had no such deductions been
made, (X) the relevant Loan Party shall make such deductions, (Y) the relevant
Loan Party shall pay the full amount deducted to the relevant taxing authority
or other authority in accordance with applicable law, and (Z) the relevant
Loan Party shall deliver to the Administrative Agent evidence of such payment.
(b) In addition, each Loan Party agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies of the United States or any political subdivision thereof or
any applicable foreign jurisdiction, and all liabilities with respect thereto,
in each case arising from any payment made under any Loan Document or from the
execution, delivery or registration of, or otherwise with respect to, any Loan
Document (collectively, "Other Taxes").
(c) Each Loan Party shall, jointly and severally, indemnify each
Lender, Issuer and the Administrative Agent for the full amount of Taxes and
Other Taxes (including any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 2.16) paid by such Lender, Issuer or the
Administrative Agent (as the case may be) and any liability (including for
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
This indemnification shall be made within 30 days from the date such Lender,
Issuer or the Administrative Agent (as the case may be) makes written demand
therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes by any Loan Party, the Borrower shall furnish to the Administrative
Agent, at its address referred to in Section 13.8, the original or a certified
copy of a receipt evidencing payment thereof.
52
(e) Without prejudice to the survival of any other agreement of any
Loan Party hereunder, the agreements and obligations of such Loan Party
contained in this Section 2.16 shall survive the payment in full of the
Obligations.
(f) Prior to the Closing Date in the case of each Non-U.S. Lender
that is a signatory hereto, and on the date of the Assignment and Acceptance
pursuant to which it becomes a Lender in the case of each other Non-U.S.
Lender and from time to time thereafter if requested by the Borrower or the
Administrative Agent, each Non-U.S. Lender that is entitled at such time to an
exemption from United States withholding tax, or that is subject to such tax
at a reduced rate under an applicable tax treaty, shall provide the
Administrative Agent and the Borrower with two completed originals of each of
the following: (i) Form W-8ECI (claiming exemption from withholding because
the income is effectively connected with a U.S. trade or business) or any
successor form; (ii) Form W-8BEN (claiming exemption from, or a reduction of,
withholding tax under an income tax treaty) or any successor form; (iii) in
the case of a Non-U.S. Lender claiming exemption under Sections 871(h) or
881(c) of the Code, a Form W-8BEN (claiming exemption from withholding under
the portfolio interest exemption) or successor form; or (iv) any other
applicable form, certificate or document prescribed by the IRS certifying as
to such Non-U.S. Lender's entitlement to such exemption from United States
withholding tax or reduced rate with respect to all payments to be made to
such Non-U.S. Lender under the Loan Documents. Unless the Borrower and the
Administrative Agent have received forms or other documents satisfactory to
them indicating that payments under any Loan Document to or for a Non-U.S.
Lender are not subject to United States withholding tax or are subject to such
tax at a rate reduced by an applicable tax treaty, the Loan Parties and the
Administrative Agent shall withhold amounts required to be withheld by
applicable requirements of law from such payments at the applicable statutory
rate.
(g) Any Revolving Credit Lender claiming any additional amounts
payable pursuant to this Section 2.16 shall use its reasonable efforts
(consistent with its internal policies and requirements of law) to change the
jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such additional amounts
that would be payable or may thereafter accrue and would not, in the sole
determination of such Revolving Credit Lender, be otherwise disadvantageous to
such Revolving Credit Lender.
Section 2.17. Substitution of Lenders.
-----------------------
(a) In the event that (i)(A) any Revolving Credit Lender makes a
claim under Section 2.14(c) (Increased Costs) or 2.15 (Capital Adequacy), (B)
it becomes illegal for any Revolving Credit Lender to continue to fund or make
any Eurodollar Rate Loan and such Revolving Credit Lender notifies the
Borrower pursuant to Section 2.14(d) (Illegality), (C) any Loan Party is
required to make any payment pursuant to Section 2.16 (Taxes) that is
attributable to a particular Revolving Credit Lender or (D) any Revolving
Credit Lender becomes a Non-Funding Lender, (ii) in the case of clause (i)(A)
above, as a consequence of increased costs in respect of which such claim is
made, the effective rate of interest payable to such Revolving Credit Lender
under this Agreement with respect to its Loans exceeds the effective average
annual rate of interest payable to the Requisite Lenders under this Agreement
and (iii) in the case of clause (i)(A), (B) and (C) above, Revolving Credit
Lenders holding at least 75% of the Revolving Credit Commitments are not
subject to such increased costs or illegality, payment or proceedings (any
such Revolving Credit Lender, an "Affected Lender"), the Borrower may
substitute any Lender and, if reasonably acceptable to the Administrative
Agent, any other Eligible Assignee (a "Substitute Institution") for such
Affected Lender hereunder, after delivery of a written notice (a "Substitution
Notice") by the Borrower to the Administrative Agent and the Affected Lender
53
within a reasonable time (in any case not to exceed 90 days) following the
occurrence of any of the events described in clause (i) above that the
Borrower intends to make such substitution; provided, however, that, if more
than one Revolving Credit Lender claims increased costs, illegality or right
to payment arising from the same act or condition and such claims are received
by the Borrower within 30 days of each other, then the Borrower may substitute
all, but not (except to the extent the Borrower has already substituted one of
such Affected Lenders before the Borrower's receipt of the other Affected
Lenders' claim) less than all, Revolving Credit Lenders making such claims.
(b) If the Substitution Notice was properly issued under this Section
2.17, the Affected Lender shall sell, and the Substitute Institution shall
purchase, all rights and claims of such Affected Lender under the Loan
Documents, and the Substitute Institution shall assume, and the Affected
Lender shall be relieved of, the Affected Lender's Revolving Credit
Commitments and all other prior unperformed obligations of the Affected Lender
under the Loan Documents (other than in respect of any damages (other than
exemplary or punitive damages, to the extent permitted by applicable law) in
respect of any such unperformed obligations). Such purchase and sale (and the
corresponding assignment of all rights and claims hereunder) shall be
effective on (and not earlier than) the later of (i) the receipt by the
Affected Lender of its Ratable Portion of the Revolving Credit Outstandings,
together with any other Obligations owing to it, (ii) the receipt by the
Administrative Agent of an agreement in form and substance satisfactory to it
and the Borrower whereby the Substitute Institution shall agree to be bound by
the terms hereof and (iii) the payment in full to the Affected Lender in cash
of all fees, unreimbursed costs and expenses and indemnities accrued and
unpaid through such effective date. Upon the effectiveness of such sale,
purchase and assumption, the Substitute Institution shall become a "Lender"
hereunder for all purposes of this Agreement having a Revolving Credit
Commitment in the amount of such Affected Lender's Revolving Credit Commitment
assumed by it and such Revolving Credit Commitment of the Affected Lender
shall be terminated; provided, however, that all indemnities under the Loan
Documents shall continue in favor of such Affected Lender.
(c) Each Revolving Credit Lender agrees that, if it becomes an
Affected Lender and its rights and claims are assigned hereunder to a
Substitute Institution pursuant to this Section 2.17, it shall execute and
deliver to the Administrative Agent an Assignment and Acceptance to evidence
such assignment, together with any Revolving Credit Note (if such Loans are
evidenced by a Revolving Credit Note) evidencing the Loans subject to such
Assignment and Acceptance; provided, however, that the failure of any Affected
Lender to execute an Assignment and Acceptance shall not render such
assignment invalid.
Section 2.18. Change of Lending Office. Each Lender agrees that, upon
the occurrence of any event giving rise to the operation of Section 2.14, 2.15
or 2.16 with respect to such Lender, it will, if requested by the Borrower,
use reasonable efforts (subject to overall policy considerations of such
Lender) to designate another lending office for any Loans affected by such
event with the object of avoiding the consequences of such event; provided,
that such designation is made on terms that, in the sole judgment of such
Lender, cause such Lender and its lending office(s) to suffer no economic,
legal or regulatory disadvantage; provided, further, that nothing in this
Section 2.18 shall affect or postpone any of the obligations of any Borrower
or the rights of any Lender pursuant to Section 2.14, 2.15 or 2.16.
54
ARTICLE III
CONDITIONS TO LOANS AND LETTERS OF CREDIT
Section 3.1. Conditions Precedent to Initial Loans and Letters of
Credit. The obligation of each Revolving Credit Lender to make the Loans
requested to be made by it on the Closing Date and the obligation of each
Issuer to Issue Letters of Credit on the Closing Date is subject to the
satisfaction or due waiver in accordance with Section 13.1 of each of the
following conditions precedent on or before January 31, 2005:
(a) Bankruptcy Court Order. The Bankruptcy Court shall have entered
the Interim Order, certified by the Clerk of the Bankruptcy Court as having
been duly entered, and the Interim Order shall be in full force and effect and
shall not have been vacated, reversed, modified, amended or stayed without the
prior written consent of the Administrative Agent and the Requisite Lenders.
(b) Certain Documents. The Administrative Agent shall have received
on or prior to the Closing Date (and, to the extent any Borrowing of any
Eurodollar Rate Loans is requested to be made on the Closing Date, in respect
of the Notice of Borrowing for such Eurodollar Rate Loans, at least three
Business Days prior to the Closing Date) each of the following, each dated the
Closing Date unless otherwise indicated or agreed to by the Administrative
Agent, in form and substance satisfactory to the Administrative Agent and in
sufficient copies for each Lender:
(i) this Agreement, duly executed and delivered by each of the
Loan Parties and, for the account of each Lender requesting the same,
a Revolving Credit Note of the Borrower conforming to the
requirements set forth herein;
(ii) a favorable opinion of (A) Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP, counsel to the Loan Parties, in substantially the form of
Exhibit H-1 (Form of Opinion of Counsel for the Loan Parties) and (B)
general counsel to the Loan Parties, in substantially the form of
Exhibit H-2 (Form of Opinion of General Counsel for the Loan
Parties), in each case addressed to the Administrative Agent and the
Lenders and addressing such other matters as any Lender through the
Administrative Agent may reasonably request;
(iii) a copy of the articles or certificate of incorporation (or
equivalent Constituent Document) of each Loan Party, certified as of
a recent date by the Secretary of State of the state of organization
of such Loan Party, together with certificates of such official
attesting to the good standing of each such Loan Party (other than
any Loan Party listed on Schedule 4.1);
(iv) a certificate of the Secretary or an Assistant Secretary of
each Loan Party certifying (A) the names and true signatures of each
officer of such Loan Party that has been authorized to execute and
deliver any Loan Document or other document required hereunder to be
executed and delivered by or on behalf of such Loan Party, (B) the
by-laws (or equivalent Constituent Document) of such Loan Party as in
effect on the date of such certification, (C) the resolutions of such
Loan Party's Board of Directors (or equivalent governing body)
approving and authorizing the execution, delivery and performance of
this Agreement and the other Loan Documents to which it is a party
and (D) that there have been no changes in the certificate of
incorporation (or equivalent Constituent Document) of such Loan Party
55
from the certificate of incorporation (or equivalent Constituent
Document) delivered pursuant to the immediately preceding clause;
(v) a certificate of a Responsible Officer to the effect that
(A) the condition set forth in Section 3.3(b) has been satisfied and
(B) no litigation not listed on Schedule 4.6 (Litigation) shall have
been commenced against any Loan Party or any of its Subsidiaries that
would have a Material Adverse Effect;
(vi) evidence satisfactory to the Administrative Agent that the
insurance policies required by Section 7.5 and any Collateral
Document are in full force and effect, together with endorsements
naming the Administrative Agent, on behalf of the Secured Parties, as
an additional insured or loss payee under all insurance policies to
be maintained with respect to the properties of the Borrower and its
Subsidiaries;
(vii) evidence satisfactory to the Administrative Agent of the
receipt of the consents, authorizations and approvals, and the making
of the filings, listed on Schedule 4.2;
(viii) all motions and other documents filed in connection with
the Facility and all First Day Orders shall be in form and substance
satisfactory to the Administrative Agent in its sole discretion, and
(ix) such other certificates, documents, agreements and
information respecting any Loan Party as any Lender through the
Administrative Agent may reasonably request.
(c) Fee and Expenses Paid. There shall have been paid to the
Administrative Agent, for the account of the Administrative Agent and the
Lenders, as applicable, all fees and expenses (including reasonable fees and
expenses of counsel) due and payable on or before the Closing Date (including
all such fees described in the Fee Letter).
(d) Projections; Budget. The Administrative Agent shall have received
the Interim Projections and a 30 day budget prepared by the Borrower, each in
form and substance satisfactory to the Administrative Agent.
(e) Refinancing of Existing Credit Agreement. (i) All "Revolving
Loans" under and as defined in the Existing Credit Agreement shall have been
repaid in full, (ii) the "Revolving Commitments" under and as defined in the
Existing Credit Agreement shall have been terminated and (iii) the
Administrative Agent shall have received a payoff letter duly executed and
delivered by the Borrower and Bank of America, N.A., as the Revolving Agent,
or other evidence of such termination in each case in form and substance
satisfactory to the Administrative Agent.
Section 3.2. Conditions Precedent to the Incremental Facility
Effective Date. The obligation of each Revolving Credit Lender to make the
Loans requested to be made by it and the obligation of each Issuer to Issue
Letters of Credit, in each case, under the Incremental Facility is subject to
the satisfaction or due waiver in accordance with Section 13.1 of each of the
following conditions precedent on or before April 30, 2005:
(a) The Administrative Agent shall have received each of the
following:
56
(i) copies of UCC search reports as of a recent date listing
all effective financing statements that name any Loan Party as debtor,
together with copies of such financing statements, none of which
shall cover the Collateral (except for those otherwise permitted
hereunder);
(ii) all certificates, instruments and other documents
representing all Pledged Stock being pledged pursuant to this
Agreement and stock powers for such certificates, instruments and
other documents executed in blank;
(iii) all instruments representing all Pledged Notes being
pledged pursuant to this Agreement, in each case duly endorsed in
favor of the Administrative Agent or in blank; and
(iv) a certificate dated as of a recent date by the Secretary of
State of the state of organization of the Borrower and any Loan Party
listed on Schedule 4.1, attesting to the good standing of the
Borrower and such Loan Party.
(b) The Administrative Agent shall have completed a legal due
diligence investigation of the Borrower, the Subsidiary Guarantors and their
respective subsidiaries in scope, and with results, reasonably satisfactory to
it.
(c) The Administrative Agent shall have completed a business due
diligence investigation of the Borrower, the Subsidiary Guarantors and their
respective Subsidiaries in scope, and with results, satisfactory to it, and
the Administrative Agent shall have received, as part of such due diligence
investigation each of the items set forth below and such further items as it
may request from time to time, each in form and substance satisfactory to it:
(i) A detailed business plan of the Borrower and its
Subsidiaries which shall include the Incremental Projections and a
financial forecast (including income statements, balance sheets, cash
flow statements and a detailed listing of assumptions) on a monthly
basis for the first twelve months after the Closing Date and on a
quarterly basis thereafter through the second year from the Closing
Date prepared by management of the Borrower.
(ii) A 13-week rolling cash flow forecast for the 13 week period
commencing on the first day of the week in which the Incremental
Facility Effective Date occurs, detailing cash receipts and cash
disbursements on a weekly basis for such period.
(iii) The use of proceeds of the Facility as of the Incremental
Facility Effective Date.
(iv) A field examination on accounts receivables, accounts
payable, cash management systems and on other areas to be determined
by the Administrative Agent.
(v) Completed third party appraisals of all Inventory and
Accounts of the Borrower and its Subsidiaries.
(d) The Administrative Agent shall have been given such access to and
be reasonably satisfied with the management, records, books of account,
contracts, and properties of the Borrower, the Subsidiary Guarantors and their
respective Subsidiaries and shall have received such financial, business,
57
legal and other information regarding the Borrower, the Subsidiary Guarantors
and their respective Subsidiaries as the Administrative Agent shall have
reasonably requested.
(e) Citicorp shall be satisfied with the Borrower's plan related to
the restatement of the financial statements of the Borrower and its
Subsidiaries, and the Administrative Agent shall have been granted full access
to the accountants in charge of such restatement.
(f) The Administrative Agent shall have received evidence that, as of
the Incremental Facility Effective Date, the procedures with respect to cash
management required by Section 7.12 have been established and are currently
being maintained by each Loan Party, together with copies of all executed
Deposit Account Control Agreements and Securities Account Control Agreements
executed by such Loan Party in connection therewith.
(g) The Administrative Agent shall be satisfied that the Borrower,
the Subsidiary Guarantors and their respective Subsidiaries will be able to
meet their obligations under all applicable employee and retiree welfare
plans, that such employee benefit plans are, in all material respects, funded
in accordance with the minimum statutory requirements, that no material
"reportable event" (as defined in ERISA, but excluding events for which
reporting has been waived) has occurred as to any such employee benefit plan
and that no termination of, or withdrawal from, any such employee benefit plan
has occurred or is contemplated that could result in a material liability. The
Administrative Agent shall have reviewed and be satisfied with all employee
benefit plans of the Borrower, the Subsidiary Guarantors and their respective
Subsidiaries.
(h) The Bankruptcy Court shall have entered the Final Order,
certified by the Clerk of the Bankruptcy Court as having been duly entered,
and the Final Order shall be in full force and effect and shall not have been
vacated, reversed, modified, amended or stayed without the prior written
consent of the Administrative Agent and the Requisite Lenders.
(i) The Borrower shall have requested in writing to the
Administrative Agent that the Incremental Facility come into effect.
(j) The Administrative Agent shall have received such additional
documents, information and materials as any Lender, through the Administrative
Agent, may reasonably request.
Section 3.3. Conditions Precedent to Each Loan and Letter of Credit.
The obligation of each Revolving Credit Lender on any date (including the
Closing Date) to make any Loan and of each Issuer on any date (including the
Closing Date) to Issue any Letter of Credit is subject to the satisfaction of
each of the following conditions precedent:
(a) Request for Borrowing or Issuance of Letter of Credit. With
respect to any Loan, the Administrative Agent shall have received a duly
executed Notice of Borrowing or, in the case of Swing Loans, a duly executed
Swing Loan Request, and with respect to any Letter of Credit, the
Administrative Agent and the Issuer shall have received a duly executed Letter
of Credit Request.
(b) Representations and Warranties; No Defaults. The following
statements shall be true on the date of such Loan or Issuance, both before and
after giving effect thereto and, in the case of any Loan, to the application
of the proceeds thereof:
58
(i) the representations and warranties set forth in Article IV
and in the other Loan Documents shall be true and correct on and as
of the Closing Date and shall be true and correct in all material
respects on and as of any such date after the Closing Date with the
same effect as though made on and as of such date, except to the
extent such representations and warranties expressly relate to an
earlier date, in which case such representations and warranties shall
have been true and correct in all material respects as of such
earlier date; and
(ii) no Default or Event of Default shall have occurred and be
continuing.
(c) Borrowing Base. The Borrower shall have delivered the Borrowing
Base Certificate required to be delivered by Section 6.11(a). After giving
effect to the Loans or Letters of Credit requested to be made or Issued on any
such date and the use of proceeds thereof, the Revolving Credit Outstandings
shall not exceed the Maximum Credit at such time.
(d) No Legal Impediments. The making of the Loans or the Issuance of
such Letter of Credit on such date does not violate any Requirement of Law on
the date of or immediately following such Loan or Issuance of such Letter of
Credit and is not enjoined, temporarily, preliminarily or permanently.
(e) Final Order. From and after the 30th day after the Closing Date,
the Bankruptcy Court shall have entered the Final Order, certified by the
Clerk of the Bankruptcy Court as having been duly entered, and the Final Order
shall be in full force and effect and shall not have been vacated, reversed,
modified, amended or stayed without the prior written consent of the
Administrative Agent in its sole discretion and the Requisite Lenders.
Each submission by the Borrower to the Administrative Agent of a Notice of
Borrowing or a Swing Loan Request and the acceptance by the Borrower of the
proceeds of each Loan requested therein, and each submission by the Borrower
to an Issuer of a Letter of Credit Request and the Issuance of each Letter of
Credit requested therein, shall be deemed to constitute a representation and
warranty by the Borrower as to the matters specified in Section 3.3(b) on the
date of the making of such Loan or the Issuance of such Letter of Credit.
Section 3.4. Determinations of Initial Borrowing Conditions For
purposes of determining compliance with the conditions specified in Section
3.1 (Conditions Precedent to Initial Loans and Letters of Credit), each
Revolving Credit Lender shall be deemed to have consented to, approved,
accepted or be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to
the Revolving Credit Lenders unless an officer of the Administrative Agent
responsible for the transactions contemplated by the Loan Documents shall have
received notice from such Revolving Credit Lender prior to the initial
Borrowing, borrowing of Swing Loans or Issuance or deemed Issuance hereunder
specifying its objection thereto and such Revolving Credit Lender shall not
have made available to the Administrative Agent such Revolving Credit Lender's
Ratable Portion of such Borrowing or Swing Loans.
59
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
To induce the Lenders, the Issuers and the Administrative Agent to
enter into this Agreement, the Borrower represents and warrants as to itself
and as to each other Loan Party, and each other Loan Party represents and
warrants as to such Loan Party, each of the following to the Lenders, the
Issuers and the Administrative Agent, on and as of the Closing Date and after
giving effect to the making of the Loans and the other financial
accommodations on the Closing Date and on and as of each date as required by
Section 3.3(b)(i):
Section 4.1. Corporate Existence; Compliance with Law. Each of the
Borrower and its Subsidiaries (a) is duly organized, validly existing and,
except as set forth on Schedule 4.1, in good standing under the laws of the
jurisdiction of its organization; (b) is duly qualified to do business as a
foreign entity and in good standing under the laws of each jurisdiction where
such qualification is necessary, except where the failure to be so qualified
or in good standing would not, in the aggregate, have a Material Adverse
Effect; (c) subject to the receipt of any necessary approvals of the
Bankruptcy Court, has all requisite power and authority and the legal right to
own, pledge, mortgage and operate its properties, to lease the property it
operates under lease and to conduct its business as now or currently proposed
to be conducted; (d) is in compliance with its Constituent Documents; (e) is
in compliance with all applicable Requirements of Law, except where the
failure to be in compliance would not, in the aggregate, have a Material
Adverse Effect; and (f) has all necessary Permits from or by, has made all
necessary filings with, and has given all necessary notices to, each
Governmental Authority having jurisdiction, to the extent required for such
ownership, operation and conduct, except for Permits or filings that can be
obtained or made by the taking of ministerial action to secure the grant or
transfer thereof or the failure to obtain or make would not, in the aggregate,
have a Material Adverse Effect.
Section 4.2. Corporate Power; Authorization; Enforceable Obligations.
-------------------------------------------------------
(a) The execution, delivery and performance by each Loan Party of the
Loan Documents to which it is a party and the consummation of the transactions
contemplated thereby, partners and members:
(i) are, subject to the entry of the Orders, within such Loan
Party's corporate, limited liability company, partnership or other
powers;
(ii) have been or, at the time of delivery thereof pursuant to
Article III will have been, duly authorized by all necessary
corporate, limited liability company, partnership or similar action,
including the consent of shareholders, partners and members where
required;
(iii) subject to the entry of the Orders, do not and will not
(A) contravene such Loan Party's or any of its Subsidiaries'
respective Constituent Documents, (B) violate any other Requirement
of Law applicable to such Loan Party (including Regulations T, U and
X of the Federal Reserve Board), or any order or decree of any
Governmental Authority or arbitrator applicable to such Loan Party,
(C) conflict with or result in the breach of, or constitute a default
under, or result in or permit the termination or acceleration of, any
material post-petition Contractual Obligation of such Loan Party or
any of its Subsidiaries, or (D) result in the creation or imposition
60
of any Lien upon any property of such Loan Party or any of its
Subsidiaries, other than those in favor of the Secured Parties
pursuant to this Agreement, the Collateral Documents and the Orders;
and
(iv) do not require the consent of, authorization by, approval
of, notice to, or filing or registration with, any Governmental
Authority or any other Person, other than the Bankruptcy Court and
those listed on Schedule 4.2 and that have been or will be, on or
prior to the Closing Date, obtained or made, copies of which have
been or will be delivered to the Administrative Agent pursuant to
Section 3.1, and each of which on the Closing Date will be in full
force and effect.
(b) This Agreement has been, and each of the other Loan Documents
will have been upon delivery thereof pursuant to the terms of this Agreement,
duly executed and delivered by each Loan Party party thereto. Subject to the
entry of the Orders, this Agreement is, and the other Loan Documents will be,
when delivered hereunder, the legal, valid and binding obligation of each Loan
Party party thereto, enforceable against such Loan Party in accordance with
its terms.
Section 4.3. Ownership of Borrower; Subsidiaries.
-----------------------------------
(a) As of the date hereof, the authorized capital stock of the
Borrower consists of (i) 20,713,162 shares of Class A common stock, $0.01 par
value per share, of which 17,618,818 shares are issued and outstanding, (ii)
7,000,000 shares of Class B common stock, $0.01 par value per share, of which
1,196,283 shares are issued and outstanding and (iii) 10,000,000 shares of
preferred stock, of which no shares are issued and outstanding.
(b) Set forth on Schedule 4.3 hereto is a complete and accurate list
showing, as of the Closing Date, all Subsidiaries of the Borrower and, as to
each such Subsidiary, the jurisdiction of its organization, the number of
shares of each class of Stock authorized (if applicable), the number
outstanding on the Closing Date and the number and percentage of the
outstanding shares of each such class owned (directly or indirectly) by the
Borrower. No Stock of any Subsidiary of the Borrower is subject to any
outstanding option, warrant, right of conversion or purchase or any similar
right. All of the outstanding Stock of each Subsidiary of the Borrower owned
(directly or indirectly) by the Borrower has been validly issued, is fully
paid and non-assessable (to the extent applicable) and is owned by the
Borrower or a Subsidiary of the Borrower, free and clear of all Liens (other
than the Lien in favor of the Secured Parties created pursuant to this
Agreement and the Orders and Liens securing the Prepetition Secured
Indebtedness), options, warrants, rights of conversion or purchase or any
similar rights. Neither the Borrower nor any such Subsidiary is a party to, or
has knowledge of, any post-petition agreement restricting the transfer or
hypothecation of any Stock of any such Subsidiary, other than the Loan
Documents and pre-petition Contractual Obligations subject to the automatic
stay. The Borrower does not own or hold, directly or indirectly, any Stock of
any Person other than such Subsidiaries and Investments permitted by Section
8.3.
Section 4.4. Financial Statements.
--------------------
(a) The Consolidated balance sheets of the Borrower and its
Subsidiaries as at the Fiscal Months ended on or about October 31, November 30
and December 31, 2004 and the related Consolidated statements of income,
retained earnings and cash flows of the Borrower and its Subsidiaries for the
1, 2 and 3 month or months then ended, respectively, copies of which have been
furnished to each Lender, fairly present, subject, to the absence of footnote
disclosure, normal recurring year-end audit adjustments and adjustments
61
required in connection with the resolution of the Borrower's outstanding
accounting issues with the agreement of the Borrower's Accountants, the
Consolidated financial condition of the Borrower and its Subsidiaries as at
such dates and the Consolidated results of the operations of the Borrower and
its Subsidiaries for the period ended on such dates, all in conformity with
GAAP (it being understood that the representation and warranty contained in
this Section 4.4(a) shall not be made with respect to any financial statements
delivered prior to the date on which the financial statements described in
Section 6.1(h) are delivered).
(b) Neither the Borrower nor any of its Subsidiaries has any material
obligation, contingent liability or liability for taxes, long-term leases or
unusual forward or long-term commitment that is not reflected in the Financial
Statements referred to in clause (a) above or in the notes thereto and not
otherwise permitted by this Agreement (other than those subject to the
automatic stay).
(c) The Interim Projections have been prepared by the Borrower in
light of the past operations of its business, and reflect projections for the
12 month period beginning on the Closing Date on a month by month basis. The
Interim Projections are based upon estimates and assumptions stated therein,
all of which the Borrower believes to be reasonable and fair in light of
current conditions and current facts known to the Borrower as of the date of
preparation thereof and, as of the date thereof, reflect, based on the
assumptions set forth therein, the Borrower's good faith and reasonable
estimates of the future financial performance of the Borrower and its
Subsidiaries and of the other information projected therein for the periods
set forth therein (it being understood that such projections are subject to
significant uncertainties and contingencies, many of which are beyond the
Borrower's control, and that no assurance can be given that the projections
will be realized). The Incremental Projections will have been prepared by the
Borrower in light of the past operations of its business, and reflect
projections for the 2 year period beginning on January 1, 2005 on a month by
month basis for the first year and on a quarter by quarter basis thereafter.
The Incremental Projections will be based upon estimates and assumptions
stated therein, all of which the Borrower believes will be reasonable and fair
in light of current conditions and current facts known to the Borrower and, as
of the Incremental Facility Effective Date, will reflect the Borrower's good
faith and reasonable estimates of the future financial performance of the
Borrower and its Subsidiaries and of the other information projected therein
for the periods set forth therein (it being understood that such projections
are subject to significant uncertainties and contingencies, many of which are
beyond the Borrower's control, and that no assurance can be given that the
projections will be realized).
Section 4.5. Material Adverse Change. Other than the filing of the
Cases, since the Petition Date, there has been no Material Adverse Change and
there have been no events or developments that, in the aggregate, have had a
Material Adverse Effect.
Section 4.6. Litigation. Other than the Cases and except as set forth
on Schedule 4.6, there are no pending or, to the knowledge of the Borrower,
threatened actions, investigations or proceedings affecting the Borrower, or
any of its Subsidiaries before any court, Governmental Authority or arbitrator
other than those that are subject to the automatic stay or otherwise, in the
aggregate, would not have a Material Adverse Effect. The performance of any
action by any Loan Party required or contemplated by any Loan Document is not
restrained or enjoined (either temporarily, preliminarily or permanently).
62
Section 4.7. Taxes.
-----
(a) All federal, state, local and foreign income and franchise and
other material tax returns, reports and statements (collectively, the "Tax
Returns") required to be filed by the Borrower or any of its Tax Affiliates
have been filed with the appropriate Governmental Authorities in all
jurisdictions in which such Tax Returns are required to be filed (except to
the extent that the Administrative Agent otherwise consents (such consent not
to be unreasonably withheld) with respect to any Tax Returns to be filed after
the Closing Date), all such Tax Returns are true and correct in all material
respects, and all material taxes, charges and other impositions reflected
therein or otherwise due and payable (except in each case, those which arose
prior to the Petition Date to the extent subject to the automatic stay) have
been paid prior to the date on which any fine, penalty, interest, late charge
or loss may be added thereto for non-payment thereof except where contested in
good faith and by appropriate proceedings if adequate reserves therefor have
been established on the books of the Borrower or such Tax Affiliate in
conformity with GAAP. As of the date hereof, no Tax Return is under audit or
examination by any Governmental Authority and no notice of such an audit or
examination or any assertion of any claim for Taxes has been given or made by
any Governmental Authority. Proper and accurate amounts have been withheld by
the Borrower and each of its Tax Affiliates from their respective employees
for all periods in full and complete compliance in all material respects with
the tax, social security and unemployment withholding provisions of applicable
Requirements of Law and such withholdings have been timely paid to the
respective Governmental Authorities.
(b) None of the Borrower or any of its Tax Affiliates has (i) of
executed or filed with the IRS or any other Governmental Authority any
agreement or other document extending, or having the effect of extending, the
period for the filing of any Tax Return or the assessment or collection of any
charges (other than an extension in the State of Louisiana for State income
taxes); (ii) incurred any obligation under any tax sharing agreement or
arrangement with any third-party other than those of which the Administrative
Agent has received a copy prior to the date hereof; or (iii) been a member of
an affiliated, combined or unitary group other than the group of which the
Borrower (or its Tax Affiliate) is the common parent.
(c) The Borrower does not intend to treat the Loans and the Letters
of Credit and the related transactions contemplated hereby as being a
"reportable transaction" (within the meaning of Treasury Regulation Section
1.6 011-4 of the Code).
Section 4.8. Full Disclosure.
---------------
The information prepared or furnished by or on behalf of any Loan
Party in connection with this Agreement or the consummation of the
transactions contemplated hereunder taken as a whole, does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements contained therein or herein not misleading. All facts
known to the Borrower material to an understanding of the financial condition,
business, properties or prospects of the Borrower and its Subsidiaries taken
as one enterprise have been disclosed to the Lenders.
Section 4.9. Margin Regulations. The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U of the Federal Reserve Board), and
no proceeds of any Loan will be used to purchase or carry any such margin
stock or to extend credit to others for the purpose of purchasing or carrying
any such margin stock in contravention of Regulation T, U or X of the Federal
Reserve Board.
63
Section 4.10. No Burdensome Restrictions; No Defaults.
---------------------------------------
(a) Neither the Borrower nor any of its Subsidiaries (i) is a party
to any Contractual Obligation (other than pre-petition Contractual Obligations
subject to the automatic stay) the compliance with one or more of which would
have, in the aggregate, a Material Adverse Effect or the performance of which
by any thereof, either unconditionally or upon the happening of an event,
would result in the creation of a Lien (other than a Lien permitted under
Section 8.2) on the assets of any thereof or (ii) is subject to one or more
charter or corporate restrictions that, would, in the aggregate, have a
Material Adverse Effect.
(b) Neither the Borrower nor any of its Subsidiaries is in default
under or with respect to any Contractual Obligation (other than pre-petition
Contractual Obligations subject to the automatic stay) owed by it and, to the
knowledge of the Borrower, no other party is in default under or with respect
to any Contractual Obligation owed to any Loan Party or to any Subsidiary of
any Loan Party, other than, in either case, those defaults that, in the
aggregate, would not have a Material Adverse Effect.
(c) No Default or Event of Default has occurred and is continuing.
(d) To the best knowledge of the Borrower, there are no Requirements
of Law applicable to any Loan Party or any Subsidiary of any Loan Party the
compliance with which by such Loan Party or such Subsidiary, as the case may
be, would, in the aggregate, have a Material Adverse Effect.
Section 4.11. Investment Company Act; Public Utility Holding Company
Act. Neither the Borrower nor any of its Subsidiaries is (a) an "investment
company" or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended or (b) a "holding company," or an
"affiliate", a "holding company" or a "subsidiary company" of a "holding
company", as each such term is defined and used in the Public Utility Holding
Company Act of 1935, as amended.
Section 4.12. Use of Proceeds. The proceeds of the Loans and the
Letters of Credit are being used by the Borrower (and, to the extent
distributed to them by the Borrower, each other Loan Party) solely as follows:
(a) with respect to the Interim Facility, to repay in full all "Revolving
Obligations" under and as defined in the Existing Credit Agreement (provided,
that a portion of the proceeds of the Interim Facility up to an amount
acceptable to the Administrative Agent may (i) be used as cash collateral for
outstanding letters of credit constituting such Revolving Obligations and (ii)
be funded into an escrow account pending resolution of any disputed amount of
such Revolving Obligations (except with respect to principal, interest or
obligations pursuant to letters of credit constituting such Revolving
Obligations)), (b) with respect to the Incremental Facility, to repay in full
all "Term Loans" under and as defined in the Existing Credit Agreement and all
other indebtedness and other obligations outstanding thereunder, (c) to fund
post-petition operating expenses of the Loan Parties incurred in the ordinary
course of business, (d) to pay certain other costs and expenses of
administration of the Cases to be specified in writing to the Administrative
Agent (including by notice of application for Orders), and (e) for working
capital, capital expenditures and other general corporate purposes of the Loan
Parties not in contravention of any Requirement of Law or the Loan Documents.
The Borrower shall use the entire amount of the proceeds of each Loan in
accordance with this Section 4.12; provided, however, that nothing herein
shall in any way prejudice or prevent the Administrative Agent or the Lenders
from objecting, for any reason, to any requests, motions or applications made
64
in the Bankruptcy Court, including any applications for interim or final
allowances of compensation for services rendered or reimbursement of expenses
incurred under sections 105(a), 330 or 331 of the Bankruptcy Code, by any
party in interest, and provided, further, that the Borrower shall not use the
proceeds from any Loans or Letters of Credit for any purpose that is
prohibited under the Bankruptcy Code.
Section 4.13. Insurance. All policies of insurance of any kind or
nature of the Borrower or any of its Subsidiaries, including policies of life,
fire, theft, product liability, public liability, property damage, other
casualty, employee fidelity, workers' compensation and employee health and
welfare insurance, are in full force and effect and are of a nature and
provide such coverage as is sufficient and as is customarily carried by
businesses of the size and character of such Person.
Section 4.14. Labor Matters.
-------------
(a) There are no strikes, work stoppages, slowdowns or lockouts
pending or threatened against or involving the Borrower or any of its
Subsidiaries, other than those that, in the aggregate, would not have a
Material Adverse Effect.
(b) There are no unfair labor practices, grievances, complaints or
arbitrations pending, or, to the Borrower's knowledge, threatened, against or
involving the Borrower or any of its Subsidiaries, nor are there any
arbitrations or grievances threatened involving the Borrower or any of its
Subsidiaries, other than those that, in the aggregate, would not have a
Material Adverse Effect.
(c) Except as set forth on Schedule 4.14, as of the Closing Date,
there is no collective bargaining agreement covering any employee of the
Borrower or its Subsidiaries, other than those entered into prior to the
Petition Date which are subject to the automatic stay.
(d) Schedule 4.14 sets forth, as of the date hereof, all material
consulting agreements, executive employment agreements, executive compensation
plans, deferred compensation agreements, employee stock purchase and stock
option plans and severance plans of the Borrower and any of its Subsidiaries,
other than those entered into prior to the Petition Date which are subject to
the automatic stay.
Section 4.15. ERISA.
-----
(a) Schedule 4.15 separately identifies as of the date hereof all
Title IV Plans, all Multiemployer Plans and all of the employee benefit plans
within the meaning of Section 3(3) of ERISA to which the Borrower or any of
its Subsidiaries has any obligation or liability, contingent or otherwise.
(b) Each employee benefit plan of the Borrower or any of its
Subsidiaries intended to qualify under Section 401 of the Code does so
qualify, and any trust created thereunder is exempt from tax under the
provisions of Section 501 of the Code, except where such failures, in the
aggregate, would not have a Material Adverse Effect.
(c) Each Title IV Plan is in compliance in all material respects with
applicable provisions of ERISA, the Code and other Requirements of Law except
for non-compliances that, in the aggregate, would not have a Material Adverse
Effect.
65
(d) Other than the Cases, there has been no, nor is there reasonably
expected to occur, any ERISA Event other than those that, in the aggregate,
would not have a Material Adverse Effect.
(e) Except to the extent set forth on Schedule 4.15, none of the
Borrower, any of the Borrower's Subsidiaries or any ERISA Affiliate would have
any Withdrawal Liability as a result of a complete withdrawal as of the date
hereof from any Multiemployer Plan.
Section 4.16. Environmental Matters.
---------------------
(a) The operations of the Borrower and each of its Subsidiaries have
been and are in compliance with all Environmental Laws, including obtaining
and complying with all required environmental, health and safety Permits,
other than non-compliances that, in the aggregate, would not have a Material
Adverse Effect.
(b) None of the Borrower or any of its Subsidiaries or any Real
Property currently or, to the knowledge of the Borrower, previously owned,
operated or leased by or for the Borrower or any of its Subsidiaries is
subject to any pending or, to the knowledge of the Borrower, threatened,
claim, order, agreement, notice of violation, notice of potential liability or
is the subject of any pending or threatened proceeding or governmental
investigation under or pursuant to Environmental Laws other than those that,
in the aggregate, would not have a Material Adverse Effect.
(c) Except as disclosed on Schedule 4.16, none of the Borrower or any
of its Subsidiaries is a treatment, storage or disposal facility requiring a
Permit under the Resource Conservation and Recovery Act, 42 U.S.C. ss. 6901 et
seq., the regulations thereunder or any state analog.
(d) There are no facts, circumstances or conditions arising out of or
relating to the operations or ownership of Real Property owned, operated or
leased by the Borrower or any of its Subsidiaries that are not specifically
included in the financial information furnished to the Lenders other than
those that, in the aggregate, would not have a Material Adverse Effect.
(e) As of the date hereof, no Environmental Lien has attached to any
property of the Borrower or any of its Subsidiaries and, to the knowledge of
the Borrower, no facts, circumstances or conditions exist that could
reasonably be expected to result in any such Lien attaching to any such
property.
(f) As of the date hereof, the Borrower and each of its Subsidiaries
has made available to the Lenders, to the extent requested, copies of all
environmental, health or safety audits, studies, assessments, inspections,
investigations or other environmental health and safety reports relating to
the operations of the Borrower or any of its Subsidiaries or any Real Property
of any of them that are in the possession, custody or control of the Borrower
or any of its Subsidiaries.
Section 4.17. Intellectual Property. The Borrower and its
Subsidiaries own or license or otherwise have the right to use all Material
Intellectual Property and other material intellectual property rights that are
necessary for the operations of their respective businesses, without
infringement upon or conflict with the rights of any other Person with respect
thereto, including all trade names associated with any private label brands of
the Borrower or any of its Subsidiaries. To the Borrower's knowledge, no
Material Intellectual Property, slogan or other advertising device, product,
66
process, method, substance, part or component, or other material now employed,
or now contemplated to be employed, by the Borrower or any of its Subsidiaries
infringes upon or conflicts with any rights owned by any other Person, and no
material claim or litigation regarding any of the foregoing is pending or
threatened.
Section 4.18. Title; Real Property.
--------------------
(a) Each of the Borrower and its Subsidiaries has good and marketable
title to, or valid leasehold interests in, all material Real Property, good
title to all Inventory, Installment Contracts and Accounts and good title to
all other material personal property, in each case that is purported to be
owned or leased by it, including those reflected on the most recent Financial
Statements delivered by the Borrower and not disposed of since the date
thereof, and none of such properties and assets is subject to any Lien, except
Liens permitted under Section 8.2. The Borrower and its Subsidiaries have
received all deeds, assignments, waivers, consents, non-disturbance and
recognition or similar agreements, bills of sale and other documents in
respect of, and have duly effected all recordings, filings and other actions
necessary to establish, protect and perfect, the Borrower's and its
Subsidiaries' right, title and interest in and to all such property.
(b) Set forth on Schedule 4.18 hereto is a complete and accurate list
of all Real Property of each Loan Party and its Subsidiaries and showing as of
the Closing Date the current street address (including, where applicable,
county, state and other relevant jurisdictions), record owner and, where
applicable, lessee thereof.
(c) All Permits required to have been issued or appropriate to enable
all Real Property of the Borrower or any of its Subsidiaries to be lawfully
occupied and used for all of the purposes for which they are currently
occupied and used have been lawfully issued and are in full force and effect,
other than those that, in the aggregate, would not have a Material Adverse
Effect.
(d) None of the Borrower or any of its Subsidiaries has received any
notice, or has any knowledge, of any pending, threatened or contemplated
condemnation proceeding affecting any Real Property of the Borrower or any of
its Subsidiaries or any part thereof, except those which, in the aggregate,
would not have a Material Adverse Effect.
Section 4.19. Secured, Super Priority Obligations.
-----------------------------------
(a) On and after the Closing Date, the provisions of the Loan
Documents and the Orders are effective to create in favor of the
Administrative Agent, for the benefit of the Secured Parties, legal, valid and
perfected Liens on and security interests (having the priority provided for
herein and in the Orders) in all right, title and interest in the Collateral,
enforceable against each Loan Party that owns an interest in such Collateral.
(b) Pursuant to subsections 364(c)(2) and (3) of the Bankruptcy Code
and the Orders, all amounts owing by the Borrower under the Facility and by
the Guarantors in respect thereof (including, without limitation, any exposure
of a Lender or any of its Affiliates in respect of Cash Management Obligations
or Hedging Contracts incurred on behalf of any Loan Party) will be secured by
a first priority perfected Lien on the Collateral, subject only to (i) valid,
perfected, nonavoidable and enforceable Liens existing as of the Petition
Date, other than the Liens on the Collateral securing Prepetition Secured
Indebtedness, (ii) the Carve-Out, (iii) Liens permitted under Section 8.2 (d)
and (iv) post-petition Liens permitted under Section 8.2(c), (e) and (i);
provided, however, that the Liens granted to the Administrative Agent, for the
benefit of the Secured Parties, shall be senior to any Lien which is expressly
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stated herein to be junior to the Liens in favor of the Administrative Agent,
for the benefit of the Secured Parties.
(c) Pursuant to section 364(c) of the Bankruptcy Code and the Orders,
all Secured Obligations of the Borrower and all Secured Obligations of the
Subsidiary Guarantors (including, without limitation, any exposure of a Lender
or any of its Affiliates in respect of Cash Management Obligations or Hedging
Contracts incurred on behalf of any Loan Party) at all times will constitute
allowed super-priority administrative expense claims in each of the Cases
having priority over all administrative expenses of the kind specified in
sections 503(b) or 507(b) of the Bankruptcy Code, subject only to the
Carve-Out.
(d) Pursuant to subsections 364(d)(1) of the Bankruptcy Code and the
Orders, all amounts owing by the Borrower under the Facility and by the
Guarantors in respect thereof (including, without limitation, any exposure of
a Lender or any of its Affiliates in respect of Cash Management Obligations or
Hedging Contracts incurred on behalf of any Loan Party) will be secured by a
first priority, perfected and senior priming Lien on the Prepetition
Collateral, subject only to (i) the Carve-Out, (ii) Liens permitted under
Section 8.2(d) and (iii) post-petition Liens permitted under Section 8.2(c),
(e) and (i).
(e) The Interim Order and (to the extent entered) the Final Order and
the transactions contemplated hereby and thereby, are in full force and effect
and have not been vacated, reversed, modified, amended or stayed without the
prior written consent of the Administrative Agent.
Section 4.20. Deposit Accounts; Control Accounts. The only Deposit
Accounts, Securities Accounts or Commodity Accounts maintained by any Loan
Party on the date hereof are those listed on Schedule 4.20, which sets forth
such information separately for each Loan Party.
Section 4.21. Title; No Other Liens. Except for the Lien granted to
the Administrative Agent pursuant to this Agreement, (a) each Loan Party is
the record and beneficial owner of the Pledged Collateral pledged by it
hereunder constituting Instruments or certificated securities and is the
entitlement holder of all such Pledged Collateral constituting Investment
Property held in a Securities Account and owns each other item of Collateral
in which a Lien is granted by it hereunder and (b) all such Collateral is
owned free and clear of any and all Liens other than Liens permitted by
Section 8.2.
Section 4.22. Pledged Collateral.
------------------
(a) The Pledged Stock, Pledged Partnership Interests and Pledged LLC
Interests pledged hereunder by each Loan Party constitutes that percentage of
the issued and outstanding equity of all classes of each issuer thereof as set
forth on Schedule 4.22.
(b) All of the Pledged Stock, Pledged Partnership Interests and
Pledged LLC Interests have been duly and validly issued and are fully paid and
nonassessable.
(c) All Pledged Stock, Pledged Partnership Interests, Pledged LLC
Interests and Pledged Notes of such Loan Party as of the date hereof are
listed on Schedule 4.22.
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(d) As of the Incremental Facility Effective Date and at all times
thereafter, all Pledged Collateral consisting of certificated securities or
Instruments has been delivered to the Administrative Agent to the extent
requested by the Administrative Agent.
(e) As of the Incremental Facility Effective Date and at all times
thereafter, all Pledged Collateral held by a Securities Intermediary in a
Securities Account is, to the extent requested by the Administrative Agent, in
a Control Account.
(f) Other than the Pledged Partnership Interests and the Pledged LLC
Interests that constitute General Intangibles, as of the Incremental Facility
Effective Date, there is no Pledged Collateral other than that represented by
certificated securities or Instruments in the possession of the Administrative
Agent or that consisting of Financial Assets held, to the extent requested by
the Administrative Agent, in a Control Account.
(g) No Person other than the Administrative Agent and, prior to the
Incremental Facility Effective Date, the Existing Collateral Agent has Control
over any Investment Property of such Loan Party.
Section 4.23. Intellectual Property.
---------------------
(a) Schedule 4.23 lists all material Intellectual Property of such
Loan Party on the date hereof, separately identifying that owned by such Loan
Party and that licensed to such Loan Party. The Intellectual Property set
forth on Schedule 4.23 for such Loan Party constitutes all of the intellectual
property rights necessary to conduct its business.
(b) On the date hereof, all Intellectual Property owned by such Loan
Party is valid, subsisting, unexpired and enforceable, has not been adjudged
invalid and has not been abandoned and the use thereof in the business of such
Loan Party does not infringe the intellectual property rights of any other
Person, except where the foregoing to be true would not have a Material
Adverse Effect.
(c) Except as set forth in Schedule 4.23, on the date hereof, none of
the Intellectual Property owned by such Loan Party is the subject of any
licensing or franchise agreement pursuant to which such Loan Party is the
licensor or franchisor.
(d) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of,
or such Loan Party's rights in, any Intellectual Property, except where the
foregoing to be true would not have a Material Adverse Effect.
(e) No action or proceeding seeking to limit, cancel or question the
validity of any Intellectual Property owned by such Loan Party or such Loan
Party's ownership interest therein is on the date hereof pending or, to the
knowledge of such Loan Party, threatened. There are no claims, judgments or
settlements to be paid by such Loan Party relating to the Intellectual
Property.
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ARTICLE V
FINANCIAL COVENANTS
Each of the Borrower and the other Loan Parties agrees with the
Lenders, the Issuers and the Administrative Agent to each of the following as
long as any Obligation or any Revolving Credit Commitment remains outstanding
and, in each case, unless the Requisite Lenders otherwise consent in writing:
Section 5.1. Minimum EBITDAR.
---------------
(a) If the Incremental Facility Effective Date shall have occurred on
or before March 31, 2005, the Borrower shall have, as of the last day of the
Fiscal Month ending on or about Xxxxx 00, 0000, XXXXXXX for the period
commencing on October 3, 2004 and ending on the last day of such Fiscal Month
of not less than an amount to be agreed upon between the Borrower and the
Administrative Agent.
(b) The Borrower shall have, as of the last day of the Fiscal Month
ending on or around April 30, 2005 and each Fiscal Month thereafter, EBITDAR
for the twelve Fiscal Months ending on such day (or with respect to the Fiscal
Months ending on or before September 30, 2005, the period commencing on
October 3, 2004 and ending on the last day of such Fiscal Month) of not less
than amounts to be agreed upon between the Borrower and the Administrative
Agent.
Section 5.2. Capital Expenditures. The Borrower shall not permit
Capital Expenditures to be made or incurred during each of the Fiscal Years
ending on or around December 31, 2005 and 2006 to be in excess of amounts to
be agreed upon between the Borrower and the Administrative Agent.
Upon the Administrative Agent and the Borrower agreeing upon the
respective amounts for each of the financial covenants referred to in Sections
5.1 and 5.2, such amounts shall be deemed incorporated into such provisions of
this Agreement pursuant to an annex to this Agreement executed by the Borrower
and the Administrative Agent.
ARTICLE VI
REPORTING COVENANTS
Each of the Borrower and the other Loan Parties agrees with the
Lenders, the Issuers and the Administrative Agent to each of the following, as
long as any Obligation or any Revolving Credit Commitment remains outstanding
and, in each case, unless the Requisite Lenders otherwise consent in writing:
Section 6.1. Financial Statements. The Borrower shall furnish to the
Administrative Agent (with sufficient copies for each of the Lenders) each of
the following:
(a) Monthly Reports. Within 30 days after the end of each Fiscal
Month, financial information regarding the Borrower and its Subsidiaries
consisting of Consolidated unaudited balance sheets as of the close of such
month and the related statements of income and cash flow for such month and
that portion of the current Fiscal Year ending as of the close of such month,
setting forth in comparative form the figures for the corresponding period in
the prior year and the figures contained in the Projections or, if applicable,
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the latest business plan provided pursuant to clause (e) below for the current
Fiscal Year, in each case certified by a Responsible Officer of the Borrower
as fairly presenting the Consolidated financial position of the Borrower and
its Subsidiaries as at the dates indicated and the results of their operations
and cash flow for the periods indicated in accordance with GAAP (subject to
the absence of footnote disclosure and normal year-end audit adjustments and
adjustments required in connection with the resolution of the Borrower's
outstanding accounting issues with the agreement of the Borrower's
Accountants).
(b) Annual Reports. As soon as available after the end of each Fiscal
Year, and in any event, after delivery of the financial information required
by clause (h) below, within 90 days after the end of each Fiscal Year,
financial information regarding the Borrower and its Subsidiaries consisting
of Consolidated balance sheets of the Borrower and its Subsidiaries as of the
end of such year and related statements of income and cash flows of the
Borrower and its Subsidiaries for such Fiscal Year, all prepared in conformity
with GAAP (subject to adjustments required in connection with the resolution
of the Borrower's outstanding accounting issues with the agreement of the
Borrower's Accountants) and certified, in the case of such Consolidated
Financial Statements, (i) prior to delivery of the financial information
required by clause (h) below, by a Responsible Officer of the Borrower as
fairly presenting the Consolidated financial position of the Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
cash flow for the periods indicated in accordance with GAAP (subject to
adjustments required in connection with the resolution of the Borrower's
outstanding accounting issues with the agreement of the Borrower's
Accountants), and (ii) after delivery of the restated financial information
required by clause (h) below, without qualification as to the scope of the
audit by the Borrower's Accountants, together with the report of such
accounting firm stating that (A) such Financial Statements fairly present the
Consolidated financial position of the Borrower and its Subsidiaries as at the
dates indicated and the results of their operations and cash flow for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years (except for changes with which the Borrower's Accountants shall
concur and which that have been disclosed in the notes to the Financial
Statements), and (B) the examination by the Borrower's Accountants in
connection with such Consolidated Financial Statements has been made in
accordance with generally accepted auditing standards, and accompanied by a
certificate stating that in the course of the regular audit of the business of
the Borrower and its Subsidiaries such accounting firm has obtained no
knowledge that a Default or Event of Default in respect of the financial
covenants contained in Article V has occurred and is continuing, or, if in the
opinion of such accounting firm, a Default or Event of Default has occurred
and is continuing in respect of such financial covenants, a statement as to
the nature thereof.
(c) Compliance Certificate. Together with each delivery of any
Financial Statement pursuant to clauses (a) and (b) of this Section 6.1, a
certificate of a Responsible Officer of the Borrower (each, a "Compliance
Certificate") (i) showing in reasonable detail the calculations used in
demonstrating compliance with each of the financial covenants contained in
Article V which is tested on a monthly basis and (ii) stating that no Default
or Event of Default has occurred and is continuing or, if a Default or an
Event of Default has occurred and is continuing, stating the nature thereof
and the action that the Borrower proposes to take with respect thereto.
(d) Corporate Chart and Other Collateral Updates. Together with each
delivery of any Financial Statement pursuant to clause (a) or (b) above, (i) a
certificate of a Responsible Officer of the Borrower certifying that the
Corporate Chart attached thereto (or the last Corporate Chart delivered
pursuant to this clause (d) or otherwise) is true, correct, complete and
current as of the date of such Financial Statement and (ii) a certificate of a
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Responsible Officer of the Borrower in form and substance reasonably
satisfactory to the Administrative Agent that all certificates, statements,
updates and other documents (including updated schedules) required to be
delivered pursuant to this Agreement or any Collateral Document by any Loan
Party in the preceding Fiscal Month have been delivered thereunder (or such
delivery requirement was otherwise duly waived or extended). The reporting
requirements set forth in this clause (d) are in addition to, and are not
intended to and shall not replace or otherwise modify, any obligation of any
Loan Party under any Loan Document (including other notice or reporting
requirements). Compliance with the reporting obligations in this clause (d)
shall only provide notice to the Administrative Agent and shall not, by
itself, modify any obligation of any Loan Party under any Loan Document,
update any Schedule to this Agreement or any schedule to any other Loan
Document or cure, or otherwise modify in any way, any failure to comply with
any covenant, or any breach of any representation or warranty, contained in
any Loan Document or any other Default or Event of Default.
(e) Business Plan. Not later than 30 days prior to the end of each
Fiscal Year, and containing substantially the types of financial information
contained in the Projections, (i) the annual business plan of the Borrower and
its Subsidiaries for the period beginning on or about October 1 of the next
succeeding Fiscal Year and ending on the second anniversary of the Closing
Date approved by the Board of Directors of the Borrower, (ii) forecasts
prepared by management of the Borrower for each fiscal month in the next
succeeding Fiscal Year, and (iii) forecasts prepared by management of the
Borrower for each of the succeeding Fiscal Years through the Fiscal Year in
which the Revolving Credit Termination Date is scheduled to occur, including,
in each instance described in clause (ii) and clause (iii) above, (A) a
projected year-end Consolidated balance sheet and income statement and
statement of cash flows and (B) a statement of all of the material assumptions
on which such forecasts are based.
(f) Management Letters, Etc. Promptly after receipt thereof by any
Loan Party, copies of each management letter, exception report or similar
letter or report received by such Loan Party from its independent certified
public accountants (including the Borrower's Accountants);
(g) Intercompany Loan Balances. Together with each delivery of any
Financial Statement pursuant to clause (a) of this Section 6.1, a summary of
the outstanding balance of all intercompany Indebtedness as of the last day of
the fiscal month covered by such Financial Statement, certified by a
Responsible Officer of the Borrower; provided, however, that such summary
shall not be required for intercompany Indebtedness among Loan Parties.
(h) Restated Financial Statements. As soon as available audited
restated financial statements regarding the Borrower and its Subsidiaries for
Fiscal Year 2002 and audited financial statements regarding the Borrower and
its Subsidiaries for the Fiscal Years 2003 and 2004, each consisting of
Consolidated balance sheets of the Borrower and its Subsidiaries as of the end
of each such Fiscal Year and related statements of income and cash flows of
the Borrower and its Subsidiaries for each such Fiscal Year, all prepared in
conformity with GAAP and certified, without qualification as to the scope of
the audit, by the Borrower's Accountants.
(i) Cash Flows. The Borrower shall deliver, as soon as available and
in any event not later than Thursday of each week, a 13-week rolling cash flow
forecast detailing cash receipts and cash disbursements on a weekly basis for
the next 13 weeks, the information and calculations contained in which shall
be reasonably satisfactory to the Administrative Agent.
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Section 6.2. Default Notices. As soon as practicable, and in any
event within five Business Days after a Responsible Officer of any Loan Party
has actual knowledge of the existence of any Default, Event of Default or
other event having had a Material Adverse Effect or having any reasonable
likelihood of causing or resulting in a Material Adverse Change, the Borrower
shall give the Administrative Agent notice specifying the nature of such
Default or Event of Default or other event, including the anticipated effect
thereof, which notice, if given by telephone, shall be promptly confirmed in
writing on the next Business Day.
Section 6.3. Litigation. Promptly after the commencement thereof, the
Borrower shall give the Administrative Agent written notice of the
commencement of all actions, suits and proceedings before any domestic or
foreign Governmental Authority or arbitrator affecting the Borrower or any of
its Subsidiaries that (i) seeks injunctive or similar relief or (ii) in the
reasonable judgment of the Borrower or such Subsidiary, expose the Borrower or
such Subsidiary to liability in an amount aggregating $1,000,000 or more or
that, if adversely determined, would have a Material Adverse Effect.
Section 6.4. Asset Sales. Prior to any Asset Sale whose Net Cash
Proceeds (or Dollar Equivalent thereof) are anticipated to exceed $500,000
(other than in connection with a going out of business sale), the Borrower
shall send the Administrative Agent a notice (a) describing such Asset Sale or
the nature and material terms and conditions of such transaction and (b)
stating the estimated Net Cash Proceeds anticipated to be received by the
Borrower or any of its Subsidiaries.
Section 6.5. SEC Filings; Press Releases. Promptly after the sending
or filing thereof, the Borrower shall send the Administrative Agent copies of
(a) all reports that the Borrower sends to its security holders generally, (b)
all reports and registration statements that the Borrower or any of its
Subsidiaries files with the Securities and Exchange Commission or any national
or foreign securities exchange or the National Association of Securities
Dealers, Inc., (c) all press releases and (d) all other statements concerning
material changes or developments in the business of such Loan Party made
available by any Loan Party to the public or its creditors generally.
Section 6.6. Labor Relations. Promptly after becoming aware of the
same, the Borrower shall give the Administrative Agent written notice of (a)
any material labor dispute to which the Borrower or any of its Subsidiaries is
or may become a party, including any strikes, lockouts or other disputes
relating to any of such Person's plants and other facilities, and (b) any
Worker Adjustment and Retraining Notification Act or related liability
incurred with respect to the closing of any plant or other facility of any
such Person.
Section 6.7. Tax Returns. Upon the request of any Lender, through the
Administrative Agent, the Borrower shall provide copies of all federal, state,
local and foreign tax returns and reports filed by the Borrower or any of its
Subsidiaries in respect of taxes measured by income (excluding sales, use and
like taxes).
Section 6.8. Insurance. As soon as is practicable and in any event
within 90 days after the end of each Fiscal Year, and at such other times
requested by the Administrative Agent, the Borrower shall furnish the
Administrative Agent (in sufficient copies for each of the Lenders) with (a) a
report in form and substance reasonably satisfactory to the Administrative
Agent and the Lenders outlining all material insurance coverage maintained as
of the date of such report by the Borrower and its Subsidiaries and the
duration of such coverage and (b) an insurance broker's statement that all
premiums then due and payable with respect to such coverage have been paid and
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confirming that the Administrative Agent has been named as loss payee or
additional insured, as applicable; provided, however, that unless a Default or
Event of Default shall be continuing, the Administrative Agent shall request
no more than two such reports during any calendar year.
Section 6.9. ERISA Matters. The Borrower shall furnish the
Administrative Agent (with sufficient copies for each of the Lenders) each of
the following:
(a) promptly and in any event within 30 days after the Borrower, any
of its Subsidiaries or any ERISA Affiliate knows that any ERISA Event has
occurred, written notice describing such event;
(b) promptly and in any event within 10 days after the Borrower, any
of its Subsidiaries or any ERISA Affiliate knows that a request for a minimum
funding waiver under Section 412 of the Code has been filed with respect to
any Title IV Plan or Multiemployer Plan, a written statement of a Responsible
Officer of the Borrower describing such ERISA Event or waiver request and the
action, if any, the Borrower, its Subsidiaries and ERISA Affiliates propose to
take with respect thereto and a copy of any notice filed with the PBGC or the
IRS pertaining thereto; and
(c) simultaneously with the date that the Borrower, any of its
Subsidiaries or any ERISA Affiliate files a notice of intent to terminate any
Title IV Plan, if such termination would require material additional
contributions in order to be considered a standard termination within the
meaning of Section 4041(b) of ERISA, a copy of each notice.
Section 6.10. Environmental Matters. The Borrower shall provide the
Administrative Agent promptly and in any event within 10 days of the Borrower
or any Subsidiary of the Borrower learning of any of the following, written
notice of each of the following:
(a) that any Loan Party is or may be liable to any Person as a result
of a Release or threatened Release that could reasonably be expected to
subject such Loan Party to Environmental Liabilities and Costs whose Dollar
Equivalent shall exceed $1,000,000;
(b) the receipt by any Loan Party of notification that any real or
personal property of such Loan Party is or is reasonably likely to be subject
to any Environmental Lien;
(c) the receipt by any Loan Party of any notice of violation of or
potential liability under, or knowledge by such Loan Party that there exists a
condition that could reasonably be expected to result in a violation of or
liability under any Environmental Law, except for violations and liabilities
the consequence of which, in the aggregate, would not be reasonably likely to
subject the Loan Parties collectively to Environmental Liabilities and Costs
whose Dollar Equivalent shall exceed $1,000,000;
(d) the commencement of any judicial or administrative proceeding or
investigation alleging a violation of or liability under any Environmental
Law, that in the aggregate, if adversely determined, would have a reasonable
likelihood of subjecting the Loan Parties collectively to Environmental
Liabilities and Costs of whose Dollar Equivalent shall exceed $1,000,000;
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(e) any proposed acquisition of stock, assets or real estate, any
proposed leasing of property, or any other action by any Loan Party or any of
its Subsidiaries other than those the consequences of which, in the aggregate,
have reasonable likelihood of subjecting the Loan Parties collectively to
Environmental Liabilities and Costs whose Dollar Equivalent shall exceed
$1,000,000;
(f) any proposed action by any Loan Party or any of its Subsidiaries
or any proposed change in Environmental Laws that in the aggregate have a
reasonable likelihood of requiring the Loan Parties to obtain additional
environmental, health or safety Permits or make additional capital
improvements to obtain compliance with Environmental Laws that in the
aggregate would have cost $1,000,000 or more or that shall subject the Loan
Parties to additional Environmental Liabilities and Costs whose Dollar
Equivalent shall exceed $1,000,000; and
(g) upon written request by any Lender through the Administrative
Agent, a report providing an update of the status of any environmental, health
or safety compliance, hazard or liability issue identified in any notice or
report delivered pursuant to this Agreement immediately.
Section 6.11. Borrowing Base Determination.
----------------------------
(a) The Borrower shall deliver, as soon as available and in any event
not later than Thursday of each week, a Borrowing Base Certificate as of the
close of business on the immediately prior Saturday together with a detailed
calculation as to the amount of the Equity Cushion as of such date, each
executed by a Responsible Officer of the Borrower.
(b) The Borrower shall (i) use its commercially reasonable efforts to
complete third party appraisals in form and substance satisfactory to the
Administrative Agent of all Inventory, Accounts and Installment Contracts of
the Borrower and its Subsidiaries promptly after the Closing Date and (ii)
conduct, or shall cause to be conducted, at its expense, and upon request of
the Administrative Agent, and present to the Administrative Agent for
approval, such appraisals, investigations and reviews as the Administrative
Agent shall request for the purpose of determining the Borrowing Base, all
upon notice and at such times during normal business hours and as often as may
be reasonably requested; provided, however, that unless a Default or Event of
Default shall be continuing, the Administrative Agent shall request no more
than four such appraisals, investigations and reviews during any calendar
year. The Borrower shall furnish to the Administrative Agent any information
that the Administrative Agent may reasonably request regarding the
determination and calculation of the Borrowing Base including correct and
complete copies of any invoices, underlying agreements, instruments or other
documents and the identity of all Account Debtors in respect of Accounts
referred to therein.
(c) The Borrower shall promptly notify the Administrative Agent in
writing in the event that at any time a Responsible Officer of the Borrower
receives or otherwise gains knowledge that (i) the Borrowing Base is less than
90% of the Borrowing Base reflected in the most recent Borrowing Base
Certificate delivered pursuant to clause (a) above or (ii) the outstanding
Revolving Credit Outstandings exceed the Borrowing Base as a result of a
decrease therein, in which case such notice shall also include the amount of
such excess.
(d) The Administrative Agent may, at the Borrower's sole cost and
expense, make test verifications of the Accounts and physical verifications of
the Inventory in any manner and through any medium that the Administrative
Agent considers advisable, and the Borrower shall furnish all such assistance
and information as the Administrative Agent may reasonably require in
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connection therewith. At any time and from time to time, upon the
Administrative Agent's request and at the expense of the Borrower, the
Borrower shall cause independent public accountants or others satisfactory to
the Administrative Agent to furnish to the Administrative Agent reports
showing reconciliations, aging and test verifications of, and trial balances
for, the Accounts; provided, however, that unless a Default or Event of
Default shall be continuing, the Administrative Agent shall request no more
than four such reports during any calendar year.
Section 6.12. Customer Contracts Promptly after any Loan Party
becoming aware of the same, the Borrower shall give the Administrative Agent
prior to the Closing Date written notice of any cancellation, termination or
loss of any post-petition material Contractual Obligation of a customer to a
Loan Party or other customer arrangement.
Section 6.13. Tax Reporting Promptly after the Borrower determines
that it intends to treat the Loans and the Letters of Credit and the related
transactions contemplated hereby as a "reportable transaction" within the
meaning of Treasury Regulation Section 1.6011-4 of the Code, the Borrower
shall give the Administrative Agent written notice thereof and shall deliver
to the Administrative Agent all IRS forms required in connection therewith.
Section 6.14. Bankruptcy Court. The Borrower shall use its best
efforts to obtain the approval of the Bankruptcy Court of this Agreement and
the other Loan Documents, without obligating the Borrower to satisfy the
conditions precedent to the Incremental Facility Effective Date contained in
Section 3.2, and deliver to the Administrative Agent and the Administrative
Agent's counsel all material pleadings, motions and other documents filed on
behalf of any of the Loan Parties with the Bankruptcy Court.
Section 6.15. Other Information. The Borrower shall provide the
Administrative Agent or any Lender with such other information respecting the
business, properties, condition, financial or otherwise, or operations of the
Borrower or any of its Subsidiaries as the Administration Agent or such any
Lender through the Administrative Agent may from time to time reasonably
request.
ARTICLE VII
AFFIRMATIVE COVENANTS
Each of the Borrower and the other Loan Parties agrees with the
Lenders, the Issuers and the Administrative Agent to each of the following, as
long as any Obligation or any Revolving Credit Commitment remains outstanding
and, in each case, unless the Requisite Lenders otherwise consent in writing:
Section 7.1. Preservation of Corporate Existence, Etc. Such Loan
Party shall, and shall cause each of its Subsidiaries to, preserve and
maintain its legal existence, rights (charter and statutory) and franchises,
except as permitted by Sections 8.4 and 8.7 or where the failure to maintain
such rights or franchises would not have a Material Adverse Effect. Within 30
days of the Closing Date, such Loan Party shall, and shall cause each of its
Subsidiaries to, take such actions to cause it to be in good standing under
the laws of the jurisdiction of its organization.
Section 7.2. Compliance with Laws, Etc. Such Loan Party shall, and
shall cause each of its Subsidiaries to, comply with all applicable
Requirements of Law, post-petition Contractual Obligations and Permits, except
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where the failure so to comply would not in the aggregate have a Material
Adverse Effect.
Section 7.3. Conduct of Business. Such Loan Party shall, and shall
cause each of its Subsidiaries to, (a) conduct its business in the ordinary
course consistent with past practice and (b) use its reasonable efforts, in
the ordinary course and consistent with past practice, to preserve its
business and the goodwill and business of the customers, advertisers,
suppliers and others having business relations with such Loan Party or any of
its Subsidiaries, except in each case where the failure to comply with the
covenants in each of clauses (a) and (b) above would not in the aggregate have
a Material Adverse Effect.
Section 7.4. Payment of Taxes, Etc. Such Loan Party shall, and shall
cause each of its Subsidiaries to, pay and discharge before the same shall
become delinquent, all material lawful governmental claims, taxes,
assessments, charges and levies arising after the Petition Date, except where
contested in good faith, by proper proceedings and adequate reserves therefor
have been established on the books of such Loan Party or the appropriate
Subsidiary in conformity with GAAP.
Section 7.5. Maintenance of Insurance. Such Loan Party shall (a)
maintain, and cause to be maintained for each of its Subsidiaries, insurance
with responsible and reputable insurance companies or associations in such
amounts and covering such risks as is usually carried by companies engaged in
similar businesses and owning similar properties in the same general areas in
which such Loan Party or such Subsidiary operates, and such other insurance as
may be reasonably requested by the Requisite Lenders, and, in any event, all
insurance required by any Loan Document and (b) cause all such insurance to
name the Administrative Agent on behalf of the Secured Parties as additional
insured or loss payee, as appropriate, and to provide that no cancellation,
material addition in amount or material change in coverage shall be effective
until after 30 days' written notice thereof to the Administrative Agent.
Section 7.6. Access. Such Loan Party shall, and shall cause each of
its Subsidiaries to, from time to time permit the Administrative Agent and the
Lenders, or any agents or representatives thereof, within three Business Days
after written notification of the same (except that during the continuance of
an Event of Default, no such notice shall be required) to (a) examine and make
copies of and abstracts from the records and books of account of such Loan
Party and each of its Subsidiaries, (b) visit the properties of such Loan
Party and each of its Subsidiaries, (c) discuss the affairs, finances and
accounts of such Loan Party and each of its Subsidiaries with any of their
respective officers or directors, and (d) communicate directly with any of
such Loan Party's certified public accountants (including the Borrower's
Accountants). Such Loan Party shall authorize its certified public accountants
(including the Borrower's Accountants) to disclose to the Administrative Agent
or any Lender any and all financial statements and other information of any
kind, as the Administrative Agent or any Lender reasonably requests and that
such accountants may have with respect to the business, financial condition,
results of operations or other affairs of such Loan Party or any of its
Subsidiaries.
Section 7.7. Keeping of Books. Such Loan Party shall, and shall cause
each of its Subsidiaries to, keep proper books of record and account, in which
full and correct entries shall be made in conformity with GAAP of all
financial transactions and the assets and business of such Loan Party and each
such Subsidiary.
Section 7.8. Maintenance of Properties, Etc. Except as otherwise
required by the Bankruptcy Code, such Loan Party shall, and shall cause each
of its Subsidiaries to, maintain and preserve (a) all of its properties which
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are necessary in the conduct of its business in good working order and
condition, (b) all rights, permits, licenses, approvals and privileges
(including all Permits) which are used or useful or necessary in the conduct
of its business, and (c) all Intellectual Property with respect to its
business, except where failure to so maintain and preserve the items set forth
in clauses (a), (b) and (c) above would not, in the aggregate, have a Material
Adverse Effect.
Section 7.9. Application of Proceeds. The Borrower (and, to the
extent distributed to them by the Borrower, each other Loan Party) shall use
the entire amount of the proceeds of the Loans as provided in Section 4.12.
Section 7.10. Environmental. Except as otherwise required by the
Bankruptcy Code or where the failure of the Loan Parties to do so would not
have a Material Adverse Effect, such Loan Party shall, and shall cause each of
its Subsidiaries to comply in all material respects with Environmental Laws
and, without limiting the foregoing, such Loan Party shall, at its sole cost
and expense, upon receipt of any notification or otherwise obtaining knowledge
of any Release or other event that has any reasonable likelihood of such Loan
Party or any of its Subsidiaries incurring Environmental Liabilities and Costs
that would have a Material Adverse Effect (a) conduct, or pay for consultants
to conduct, tests or assessments of environmental conditions at such
operations or properties, including the investigation and testing of
subsurface conditions and (b) take such Remedial Action and undertake such
investigation or other action as required by Environmental Laws or as any
Governmental Authority requires or as is appropriate and consistent with good
business practice to address the Release or event and otherwise ensure
compliance with Environmental Laws.
Section 7.11. Additional Collateral and Guaranties.
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To the extent not delivered to the Administrative Agent on or before
the Closing Date (including in respect of after-acquired property and Persons
that become Subsidiaries of any Loan Party after the Closing Date), each Loan
Party agrees promptly to do, or cause each Subsidiary of such Loan Party to
do, each of the following, unless otherwise agreed by the Administrative
Agent:
(a) deliver to the Administrative Agent a duly-executed Joinder
Agreement (or, in the case of any Subsidiary of any Loan Party that is not a
Domestic Subsidiary or that holds shares in any Person that is not a Domestic
Subsidiary, foreign guarantees and related documents), in each case in form
and substance reasonably satisfactory to the Administrative Agent and as the
Administrative Agent deems necessary or advisable in order to ensure that each
Subsidiary of each Loan Party guaranties, as primary obligor and not as
surety, the full and punctual payment when due of the Obligations or any part
thereof; provided, however, that, unless (x) the Borrower and the
Administrative Agent otherwise agree, or (y) such guaranty can be given
without resulting in any material adverse tax consequences for the Loan
Parties and their Subsidiaries, taken as a whole (including any Person that
becomes a Loan Party as a result of such pledge or grant), in no event shall
any Non-U.S. Person be required to guaranty or secure the payment of the
Obligations;
(b) deliver to the Administrative Agent a duly-executed Joinder
Agreement and, if applicable, joinders and amendments to the other Collateral
Documents (or, in the case of any such Subsidiary of any Loan Party that is
not a Domestic Subsidiary or that holds shares in any Person that is not a
Domestic Subsidiary, foreign charges, pledges, security agreements and other
Collateral Documents), in each case in form and substance reasonably
satisfactory to the Administrative Agent and as the Administrative Agent deems
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necessary or advisable in order to (i) effectively grant to the Administrative
Agent, for the benefit of the Secured Parties, a valid, perfected and
enforceable first-priority security interest in the Stock and Stock
Equivalents and other debt Securities owned by any Loan Party or any
Subsidiary of any Loan Party and (ii) effectively grant to the Administrative
Agent, for the benefit of the Secured Parties, a valid, perfected and
enforceable first-priority security interest in all property interests and
other assets of any Loan Party or any Subsidiary of any Loan Party; provided,
however, that, unless (x) the Borrower and the Administrative Agent otherwise
agree or (y) such pledge or grant can be made without resulting in any
material adverse tax consequences for the Loan Parties and their Subsidiaries,
taken as a whole (including any Person that becomes a Loan Party as a result
of such pledge or grant), in no event shall any Loan Party or any Subsidiary
thereof be required to pledge (i) in excess of 65% of the outstanding Voting
Stock of any Non-U.S. Person that is a direct Subsidiary of the Borrower or of
any Subsidiary of the Borrower that is a Domestic Person or (ii) unless such
Stock is otherwise held by the Borrower or any Subsidiary of the Borrower that
is a Domestic Person, any of the Stock of any a Subsidiary of such direct
Subsidiary;
(c) deliver to the Administrative Agent all certificates, instruments
and other documents representing all Pledged Stock, Pledged Notes (other than
those Pledged Notes issued by officers of the Loan Parties prior to the
Petition Date which are not in the custody of the Loan Parties or any agent
under the Existing Credit Agreement) and all other Stock, Stock Equivalents
and other debt Securities being pledged pursuant to the Joinder Agreement,
joinders, amendments and foreign agreements executed pursuant to clause (b)
above, together with (i) in the case of certificated Pledged Stock and other
certificated Stock and Stock Equivalents, undated stock powers endorsed in
blank and (ii) in the case of Pledged Notes and other certificated debt
Securities, endorsed in blank, in each case executed and delivered by a
Responsible Officer of such Loan Party or such Subsidiary thereof, as the case
may be;
(d) if such Subsidiary is party to a Case, to obtain an order of the
Bankruptcy Court confirming in such Subsidiary's Case extension of the terms
of the Orders to such new Subsidiary as a debtor and a debtor in possession;
(e) to take such other actions necessary or advisable to ensure the
validity or continuing validity of the guaranties required to be given
pursuant to clause (a) above or to create, maintain or perfect the security
interest required to be granted pursuant to clause (b) above, including the
filing of UCC financing statements in such jurisdictions as may be required by
the Collateral Documents or by law or as may be reasonably requested by the
Administrative Agent; and
(f) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent;
provided, however, that the requirements of this Section 7.11 shall not be
applicable to (i) Cougar Reinsurance Company Ltd. or FCJV, L.P. until the date
that is 10 Business Days after the Incremental Facility Effective Date or (ii)
FCJV, LP. so long as it has no assets.
Section 7.12. Control Accounts; Approved Deposit Accounts.
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(a) From and after the earlier of (i) the Incremental Facility
Effective Date and (ii) the date which is 30 days following the Closing Date,
such Loan Party shall, and shall cause each of its Subsidiaries to, (x)
deposit or cause to be deposited in the Cash Concentration Account or an
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Approved Deposit Account all cash they receive within one Business Day of such
receipt, (y) not establish or maintain any Securities Account that is not a
Control Account and (z) not establish or maintain any Deposit Account (other
than Deposit Accounts existing on the date hereof) other than with a Deposit
Account Bank; provided, however, that such Loan Party and each of its
respective Subsidiaries may (A) maintain payroll, withholding tax, escrow and
other fiduciary accounts, (B) maintain accounts with the Administrative Agent,
(C) maintain xxxxx cash at stores in the ordinary course of business and
consistent with past practice in all material respects in an aggregate amount
not to exceed $350,000, (D) maintain balances in accounts in respect of items
that have not yet cleared or to fund pending disbursements from such accounts
and (E) maintain other accounts with cash balances as long as the aggregate
balance in all such accounts does not exceed $500,000.
(b) From and after the earlier of (i) the Incremental Facility
Effective Date and (ii) the date which is 30 days following the Closing Date,
such Loan Party shall, and shall cause each of its Subsidiaries, to (x)
instruct each Account Debtor or other Person obligated to make a payment to
any of them under any Account or General Intangible to make payment, or to
continue to make payment, to the Cash Concentration Account or an Approved
Deposit Account that directly or indirectly sweeps collected and cleared funds
to the Cash Concentration Account on each Business Day (except with respect to
retail purchasers making payments pursuant to installment sale contracts) and
(y) except to the extent such Proceeds are maintained in accordance with the
proviso in clause (a) above, deposit in the Cash Concentration Account, an
Approved Deposit Account or another deposit account that directly or
indirectly sweeps collected and cleared funds to the Cash Concentration
Account on each Business Day immediately upon receipt all Proceeds of such
Accounts and General Intangibles received by such Loan Party or any of its
respective Subsidiaries from any other Person.
(c) In the event (i) any Loan Party, any Subsidiary of any Loan Party
or any Deposit Account Bank shall, after the date hereof, terminate an
agreement with respect to the maintenance of an Approved Deposit Account for
any reason, (ii) the Administrative Agent shall demand such termination as a
result of the failure of a Deposit Account Bank to comply with the terms of
the applicable Deposit Account Control Agreement or (iii) the Administrative
Agent determines in its sole discretion that the financial condition of a
Deposit Account Bank has materially deteriorated, each Loan Party shall, and
shall cause each of its Subsidiaries to, notify all of their respective
obligors that were making payments to such terminated Approved Deposit Account
to make all future payments to another Approved Deposit Account.
(d) In the event (i) any Loan Party, any Subsidiary of any Loan Party
or any Approved Securities Intermediary shall, after the date hereof,
terminate an agreement with respect to the maintenance of a Control Account
for any reason, (ii) the Administrative Agent shall demand such termination as
a result of the failure of an Approved Securities Intermediary to comply with
the terms of the applicable Securities Account Control Agreement or (iii) the
Administrative Agent determines in its sole discretion that the financial
condition of an Approved Securities Intermediary has materially deteriorated,
each Loan Party shall, and shall cause each of its Subsidiary to, notify all
of its obligors that were making payments to such terminated Control Account
to make all future payments to another Control Account.
(e) The Administrative Agent may establish one or more Cash
Collateral Accounts with such depositaries and Securities Intermediaries as it
in its sole discretion shall determine. The Borrower agrees that each such
Cash Collateral Account shall be under the sole dominion and control of the
Administrative Agent and that the Administrative Agent shall be the
Entitlement Holder with respect to each such Cash Collateral Account that is a
Securities Account and the only Person authorized to give Entitlement Orders
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with respect to each such Securities Account. Without limiting the foregoing,
funds on deposit in any such Cash Collateral Account may be invested (but the
Administrative Agent shall be under no obligation to make any such investment)
in Cash Equivalents at the direction of the Administrative Agent and, except
during the continuance of an Event of Default, the Administrative Agent agrees
with the Borrower to issue Entitlement Orders for such investments in Cash
Equivalents as requested by the Borrower; provided, however, that the
Administrative Agent shall not have any responsibility for, or bear any risk
of loss of, any such investment or income thereon. None of the Borrower, any
Subsidiary of the Borrower or any other Loan Party or Person claiming on
behalf of or through the Borrower, any Subsidiary of the Borrower or any other
Loan Party shall have any right to demand payment of any funds held in any
Cash Collateral Account at any time prior to the termination of all
outstanding Letters of Credit and the payment in full of all then outstanding
and payable monetary Obligations. The Administrative Agent shall apply all
funds on deposit in a Cash Collateral Account as provided in Section 2.9(d)
(Mandatory Prepayments).
Section 7.13. Cash Flow Variances. The Borrower shall regularly
update the Administrative Agent from time to time of any variances from the
13-week cash flow forecasts delivered pursuant to Section 6.1(i), provided,
however, that no departure therefrom in excess of an aggregate 20% variance
shall be permitted without the approval of the Administrative Agent (such
approval not to be unreasonably withheld).
Section 7.14. Landlord Waivers and Bailee's Letters. Such Loan Party
shall, and shall cause each of its Subsidiaries to deliver such Landlord
Waivers and Bailee's Letters as the Administrative Agent shall request in its
sole discretion exercised reasonably with respect to any Collateral that is
located in a public warehouse or in possession of a bailee or in a facility
leased by a Loan Party and the Liens and other unstayed rights of the
applicable warehouseman, bailee, or lessor are senior to or pari passu with
the Liens of the Administrative Agent.
Section 7.15. Incremental Facility Effective Date. The Borrower shall
cooperate with the Administrative Agent in connection with the Administrative
Agent's due diligence review of the Borrower and its Subsidiaries prior to the
occurrence of the Incremental Facility Effective Date.
ARTICLE VIII
NEGATIVE COVENANTS
Each of the Borrower and the other Loan Parties agrees with the
Lenders, the Issuers and the Administrative Agent to each of the following, as
long as any Obligation or any Revolving Credit Commitment remains outstanding
and, in each case, unless the Requisite Lenders otherwise consent in writing:
Section 8.1. Indebtedness. Such Loan Party shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly create, incur,
assume or otherwise become or remain directly or indirectly liable with
respect to any Indebtedness except for the following:
(a) the Secured Obligations (other than in respect of Hedging
Contracts not permitted to be incurred pursuant to clause (i) below) and
Guaranty Obligations in respect thereto;
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(b) Indebtedness existing on the date of this Agreement and disclosed
on Schedule 8.1;
(c) Guaranty Obligations incurred by the Borrower or any Subsidiary
Guarantor in respect of Indebtedness of the Borrower or any Subsidiary
Guarantor that is otherwise permitted by this Section 8.1 (other than clause
(a) above);
(d) Capital Lease Obligations and purchase money Indebtedness
incurred by such Loan Party or a Subsidiary of such Loan Party after the
Petition Date to finance the acquisition of fixed assets; provided, however,
that the Capital Expenditure related thereto is otherwise permitted by Section
5.2 (Capital Expenditures) and that the Dollar Equivalent of the aggregate
outstanding principal amount of all such Capital Lease Obligations and
purchase money Indebtedness shall not exceed $1,000,000 (or such higher amount
as may be agreed to by the Administrative Agent) at any time;
(e) Renewals, extensions, refinancings and refundings of Indebtedness
incurred after the Petition Date and permitted by clause (d) of this Section
8.1; provided, however, that any such renewal, extension, refinancing or
refunding is in an aggregate principal amount not greater than the principal
amount of, and is on terms no less favorable to the Borrower or any Subsidiary
of the Borrower obligated thereunder, including as to weighted average
maturity and final maturity, than the Indebtedness being renewed, extended,
refinanced or refunded;
(f) Indebtedness arising from intercompany loans (i) from the
Borrower to any Subsidiary Guarantor, (ii) from any Subsidiary Guarantor to
the Borrower or any other Subsidiary Guarantor, (iii) from any Subsidiary of
the Borrower that is not a Subsidiary Guarantor to the Borrower or to any
other Subsidiary of the Borrower or (iv) from the Borrower or any Subsidiary
Guarantor to any Subsidiary of the Borrower that is not a Subsidiary
Guarantor; provided, however, that, in the case of clause (iv), the Investment
in the intercompany loan to such Subsidiary is permitted under Section 8.3;
(g) Indebtedness arising under any performance or surety bond entered
into in the ordinary course of business;
(h) Obligations under Hedging Contracts permitted under Section 8.17
(No Speculative Transactions);
(i) the assumption of Indebtedness under the Vendor Lien Program on
such terms as are agreed upon by the Loan Parties and the applicable vendors,
but only to the extent such assumption constitutes a Permitted Transaction;
(j) Indebtedness which constitute Investments permitted by Section
8.3 (other than clause (g) thereof); and
(k) Indebtedness not otherwise permitted hereby in an aggregate
outstanding amount not to exceed $1,000,000 at any time.
Section 8.2. Liens, Etc. Such Loan Party shall not, and shall not
permit any of its Subsidiaries to, create or suffer to exist, any Lien upon or
with respect to any of its properties or assets, whether now owned or
hereafter acquired, or assign, or permit any of its Subsidiaries to assign,
any right to receive income, except for the following:
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(a) Liens created pursuant to the Loan Documents;
(b) Liens existing on the date of this Agreement and disclosed on
Schedule 8.2 which (except for the purchase money Lien on the Chief Executive
Office) are fully subordinated to the Liens of the Administrative Agent
pursuant to the Orders;
(c) Customary Permitted Liens on the assets of the Borrower and its
Subsidiaries;
(d) purchase money Liens granted by such Loan Party or any Subsidiary
of such Loan Party (including the interest of a lessor under a Capital Lease
and purchase money Liens to which any property is subject at the time, on or
after the date hereof, of such Loan Party's or such Subsidiary's acquisition
thereof) securing Indebtedness permitted under Section 8.1(d) and limited in
each case to the property purchased with the proceeds of such purchase money
Indebtedness or subject to such Capital Lease;
(e) deposits or letters of credit, in favor of lessors securing
operating leases or, to the extent such transactions create a Lien hereunder,
sale and leaseback transactions, in each case to the extent such operating
leases or sale and leaseback transactions are permitted hereunder;
(f) Liens on the Collateral granted as adequate protection or with
respect to the Vendor Lien Program pursuant to an order of the Bankruptcy
Court entered on or prior to the date hereof or with the approval of the
Administrative Agent; provided, however, that all such Liens granted after the
date hereof shall be on terms acceptable to the Administrative Agent,
including with respect to the subordination of all such Liens to the Liens of
the Administrative Agent, and shall not permit the holder of any such Lien to
object to any disposition of any of the Collateral, whether such disposition
is made pursuant to a foreclosure by the Administrative Agent or otherwise;
(g) Liens granted pursuant to the Vendor Lien Program to the extent
constituting a Permitted Transaction;
(h) Liens in respect of the Carve-Out;
(i) Liens on goods consigned to a Loan Party or their Subsidiaries in
connection with consignment arrangements, provided, that (i) such consignment
arrangement entered into after the date of this Agreement is evidenced by a
written agreement in form and substance satisfactory to the Administrative
Agent and (ii) such Lien is limited to such goods only during any such
consignment; and
(j) Liens of landlords arising by statute and liens of suppliers,
mechanics, carriers, materialmen, warehousemen or workmen and other liens
imposed by law created in the ordinary course of business for amounts that are
prepetition claims, that are not overdue for a period of more than 60 days or
that are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves or other appropriate provisions are being
maintained to the extent required by GAAP.
Section 8.3. Investments. Such Loan Party shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly make or maintain any
Investment except for the following:
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(a) Investments existing on the date of this Agreement and disclosed
on Schedule 8.3;
(b) Investments in cash and Cash Equivalents with respect to which
the Administrative Agent has a valid, perfected and enforceable first priority
Lien subject only to the Carve-Out;
(c) Investments in Payment intangibles, Chattel Paper and Accounts,
notes receivable and similar items arising or acquired in the ordinary course
of business consistent in all material respects with the past practice of such
Loan Party and its Subsidiaries;
(d) Investments received in settlement of amounts due to such Loan
Party or any Subsidiary of such Loan Party created in the ordinary course of
business;
(e) Investments by (i) the Borrower in any Subsidiary Guarantor, or
any Subsidiary Guarantor in the Borrower or in any other Subsidiary Guarantor,
(ii) a Subsidiary of the Borrower that is not a Subsidiary Guarantor in the
Borrower or in any other Subsidiary of the Borrower or, (iii) the Borrower or
any Subsidiary Guarantor in a Subsidiary that is not a Subsidiary Guarantor;
provided, however, that the aggregate outstanding amount of all Investments
permitted pursuant to this clause (iii) shall not exceed $250,000 at any time;
(f) loans or advances to employees of such Loan Party or any of its
Subsidiaries in the ordinary course of business as presently conducted other
than any loans or advances that would be in violation of Section 402 of the
Xxxxxxxx-Xxxxx Act; provided, however, that the Dollar Equivalent of the
aggregate principal amount of all loans and advances permitted pursuant to
this clause (f) shall not exceed $250,000 at any time;
(g) Indebtedness and Guaranty Obligations permitted by Section 8.1;
(h) Investments received in connection with the conversion, exchange
or settlement (as part of a plan of reorganization of any Crescent Party or
otherwise) of Investments disclosed on Schedule 8.3 or claims against any
Crescent Party pursuant to Permitted Transactions;
(i) Investments to fund Capital Expenditures permitted by Section
5.2; and
(j) Investments not otherwise permitted hereby in an aggregate
outstanding amount not to exceed $250,000 at any time.
Section 8.4. Sale of Assets. Such Loan Party will not, and will not
permit any of its Subsidiaries to, sell, convey, transfer, lease or otherwise
dispose of, any of its assets or any interest therein (including the sale or
factoring at maturity, but excluding collection, of any accounts) to any
Person, or permit or suffer any other Person to acquire any interest in any of
its assets or issue or sell any shares of their Stock or any Stock Equivalents
(any such disposition being an "Asset Sale"), except for the following:
(a) the sale or disposition of Inventory in the ordinary course of
business;
(b) the sale or disposition of Equipment that has become obsolete or
is replaced in the ordinary course of business;
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(c) a true lease or sublease of Real Property not constituting
indebtedness and not constituting a sale and leaseback transaction;
(d) assignments and licenses of Intellectual Property of the Borrower
and its Subsidiaries in the ordinary course of business;
(e) Permitted Transactions;
(f) the disposition of Cash Equivalents in the ordinary course of
business;
(g) any Asset Sale between Loan Parties or, on an arms-length basis,
from a Subsidiary of the Borrower that is not a Subsidiary Guarantor to the
Borrower or to any other Subsidiary of the Borrower; and
(h) the disposition of assets in the ordinary course of business in
connection with the closure of up to 10 retail stores each calendar year;
provided further, that the foregoing limitations are not intended to prevent
such Loan Party from rejecting unexpired leases or executory contracts
pursuant to section 365 of the Bankruptcy Code in connection with the Cases.
Section 8.5. Restricted Payments. Such Loan Party shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly, declare,
order, pay, make or set apart any sum for any Restricted Payment except for
Restricted Payments by any Subsidiary of the Borrower to the Borrower or any
Subsidiary Guarantor.
Section 8.6. Restriction on Fundamental Changes. Such Loan Party
shall not, and shall not permit any of its Subsidiaries to (a) merge with any
Person, (b) consolidate with any Person, (c) acquire all or substantially all
of the Stock or Stock Equivalents of any Person, (d) acquire all or
substantially all of the assets of any Person or all or substantially all of
the assets constituting the business of a division, branch or other unit
operation of any Person, (e) enter into any joint venture or partnership with
any Person or (f) acquire or create any Subsidiary unless, after giving effect
to such creation or acquisition, such Subsidiary is a Wholly-Owned Subsidiary
of the Borrower (unless such Subsidiary becomes a Subsidiary pursuant to a
Permitted Transaction), the Borrower is in compliance with Section 7.11 and
the Investment in such Subsidiary is permitted under Section 8.3(c).
Section 8.7. Change in Nature of Business. Such Loan Party shall not,
and shall not permit any of its Subsidiaries to, make any material change in
the nature of its business as carried on at the date hereof.
Section 8.8. Transactions with Affiliates. Such Loan Party shall not,
and shall not permit any of its Subsidiaries to, except with respect to the
transactions disclosed on Schedule 8.8, for Permitted Transactions or as
otherwise expressly permitted herein, do any of the following: (a) make any
Investment in an Affiliate of the Borrower which is not a Subsidiary of the
Borrower; (b) transfer, sell, lease, assign or otherwise dispose of any asset
to any Affiliate of the Borrower which is not a Subsidiary of the Borrower;
(c) merge into or consolidate with or purchase or acquire assets from any
Affiliate of the Borrower which is not a Subsidiary of the Borrower; (d) repay
any Indebtedness to any Affiliate of the Borrower which is not a Subsidiary of
the Borrower; or (e) enter into any other transaction directly or indirectly
with or for the benefit of any Affiliate of the Borrower which is not a
Subsidiary Guarantor (including guaranties and assumptions of obligations of
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any such Affiliate), except for, in the case of clause (e), (i) transactions
in the ordinary course of business on a basis no less favorable to the
Borrower or such Subsidiary Guarantor as would be obtained in a comparable
arm's length transaction with a Person not an Affiliate thereof and (ii)
salaries and other director or employee compensation to officers or directors
of the Borrower or any of its Subsidiaries.
Section 8.9. Restrictions on Subsidiary Distributions; No New
Negative Pledge. Except pursuant to the Loan Documents, any pre-petition
Contractual Obligations subject to the automatic stay and any agreements
governing purchase money Indebtedness or Capital Lease Obligations permitted
by clause (d) or (e) of Section 8.1 (in which latter case, any prohibition or
limitation shall only be effective against the assets financed thereby), such
Loan Party shall not, and shall not permit any of its Subsidiaries to, (a)
agree to enter into or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of such Subsidiary to
pay dividends or make any other distribution or transfer of funds or assets or
make loans or advances to or other Investments in, or pay any Indebtedness
owed to, the Borrower or any other Subsidiary of the Borrower or (b) enter
into or suffer to exist or become effective any agreement prohibiting or
limiting the ability of the Borrower or any Subsidiary of the Borrower to
create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired, to secure the
Obligations, including any agreement requiring any other Indebtedness or
Contractual Obligation to be equally and ratably secured with the Obligations.
Section 8.10. Restrictions on Modification of Certain Documents and
Optional Prepayments.
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(a) Such Loan Party shall not, and shall not permit any of its
Subsidiaries to, change its capital structure (including in the terms of its
outstanding Stock) or otherwise amend its Constituent Documents, except for
(i) changes and amendments which do not materially affect the rights and
privileges of such Loan Party or any of its Subsidiaries, and do not
materially affect the interests of the Administrative Agent, the Lenders and
the Issuers under the Loan Documents or in the Collateral, (ii) changes
pursuant to a plan of reorganization under the Cases and (iii) changes that
are otherwise expressly permitted in this Agreement.
(b) Such Loan Party shall not, and shall not permit any of its
Subsidiaries to, (i) make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of, or otherwise voluntarily or
optionally defease, any Indebtedness, or segregate funds for any such payment,
prepayment, repurchase, redemption or defeasance (except in each case (A) to
the extent permitted by Section 8.1(e), (B) with respect to the Vendor Lien
Program to the extent it is a Permitted Transaction and (C) the repayment of
Indebtedness under the Existing Credit Agreement with proceeds of the Loans in
accordance with Section 4.12), (ii) amend, modify or otherwise change, or
consent or agree to any amendment, modification, waiver or other change to,
any of the terms of any Indebtedness (other than (A) any such amendment,
modification, waiver or other change which (Y) would extend the maturity or
reduce the amount of any payment of principal thereof, reduce the rate or
extend the date for payment of interest thereon or relax any covenant or other
restriction applicable to the Borrower or any of its Subsidiaries and (Z) does
not involve the payment of a consent fee) or (B) with respect to the Vendor
Lien Program to the extent it is a Permitted Transaction), or (iii) amend,
modify or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of the Vendor Lien
Program (other than (A) any such amendment, modification, waiver or other
change which (Y) would extend the maturity or reduce the amount of any payment
of principal thereof, reduce the rate or extend the date for payment of
interest thereon or relax any covenant or other restriction applicable to the
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Borrower or any of its Subsidiaries and (Z) does not involve the payment of a
consent fee) or (B) to the extent it is a Permitted Transaction).
Section 8.11. Accounting Changes; Fiscal Year. Such Loan Party shall
not, and shall not permit any of its Subsidiaries to, change its (a)
accounting treatment and reporting practices or tax reporting treatment,
except as required by GAAP or any Requirement of Law or in connection with any
resolution of the Borrower's outstanding accounting issues with the agreement
of the Borrower's Accountants and disclosed to the Lenders and the
Administrative Agent or (b) Fiscal Year.
Section 8.12. Margin Regulations. The Borrower shall not, and shall
not permit any of its Subsidiaries to use all or any portion of the proceeds
of any credit extended hereunder to purchase or carry margin stock (within the
meaning of Regulation U of the Federal Reserve Board) in contravention of
Regulation U of the Federal Reserve Board.
Section 8.13. Sale/Leasebacks. Such Loan Party shall not, and shall
not permit any of its Subsidiaries to, enter into any sale and leaseback
transactions.
Section 8.14. No Speculative Transactions. Such Loan Party shall not,
and shall not permit any of its Subsidiaries to, engage in any speculative
transaction or in any transaction involving Hedging Contracts except for the
sole purpose of hedging in the normal course of business and consistent with
industry practices.
Section 8.15. Compliance with ERISA. Such Loan Party shall not, and
shall not permit any of its Subsidiaries to, or cause or permit any ERISA
Affiliate to, cause or permit to occur (a) an event which could result in the
imposition of a Lien under Section 412 of the Code or Section 302 or 4068 of
ERISA or (b) ERISA Events (other than the Cases) that would have a Material
Adverse Effect in the aggregate.
Section 8.16. Environmental. Such Loan Party shall not, and shall not
permit any of its Subsidiaries to, allow a Release of any Contaminant in
violation of any Environmental Law; provided, however, that such Loan Party
shall not be deemed in violation of this Section 8.16 if, as the consequence
of all such Releases, such Loan Party would not incur Environmental
Liabilities and Costs that would have a Material Adverse Effect.
Section 8.17. Chapter 11 Claims. Such Loan Party shall not, and shall
not permit any of its Subsidiaries to, agree to, incur, create, assume, suffer
to exist or permit (a) any administrative expense, unsecured claim, or other
super-priority claim or lien which is pari passu with or senior to the claims
of the Secured Parties against the Loan Parties hereunder (other than to incur
Indebtedness that will repay in full the Obligations and terminate the
Facility; provided, that the incurrence of such Indebtedness shall be
conditioned by the Bankruptcy Court upon the repayment in full of the
Obligations and termination of the Facility), or apply to the Bankruptcy Court
for authority to do so, except for the Carve-Out and post-petition Liens
permitted by Section 8.2(c), (d), (e) or (i) or (b) the extension of any
existing adequate protection or the grant of further adequate protection or
apply to the Bankruptcy Court for authority to do so, in each case pursuant to
this clause (b) without the consent of the Administrative Agent in its sole
discretion and except, in the case of this clause (b) only, with respect to
the Vendor Lien Program to the extent contemplated as a Permitted Transaction
and Permitted Prepetition Claim Payments.
Section 8.18. The Orders. Such Loan Party shall not, and shall not
permit any of its Subsidiaries to, make or seek any change, amendment or
modification, or any application or motion for any change, amendment or
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modification, to either Order without the prior written consent of the
Requisite Lenders.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.1. Events of Default. Each of the following events shall be
an Event of Default:
(a) the Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when the same becomes due and payable; or
(b) the Borrower shall fail to pay any interest on any Loan, any fee
under any of the Loan Documents or any other Obligation (other than one
referred to in clause (a) above) and such non-payment continues for a period
of three Business Days after the due date therefor; or
(c) any representation or warranty made or deemed made by any Loan
Party in any Loan Document or by any Loan Party (or any of its officers) in
connection with any Loan Document shall prove to have been incorrect in any
material respect when made or deemed made; or
(d) any Loan Party shall fail to perform or observe (i) any term,
covenant or agreement contained in Article V, Section 6.1, 6.2, 6.11(a), 7.1,
7.6, 7.9, 7.11, 7.12 or Article VIII, or (ii) any other term, covenant or
agreement contained in this Agreement or in any other Loan Document if such
failure under this clause (ii) shall remain unremedied for 10 Business Days
after the earlier of (A) the date on which a Responsible Officer of the
Borrower becomes aware of such failure and (B) the date on which written
notice thereof shall have been given to the Borrower by the Administrative
Agent or any Lender; or
(e) (i) the Borrower or any of its Subsidiaries shall fail to make
any payment on any post petition Indebtedness (other than the Obligations) of
the Borrower or any such Subsidiary (or any Guaranty Obligation in respect of
Indebtedness of any other Person) and, in each case such failure relates to
Indebtedness having a principal amount of $1,000,000 or more, when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise); (ii) any other event shall occur or
condition shall exist under any agreement or instrument relating to any such
post petition Indebtedness, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such post
petition Indebtedness; or (iii) any such post petition Indebtedness shall
become or be declared to be due and payable, or be required to be prepaid or
repurchased (other than by a regularly scheduled required prepayment or
customary mandatory prepayment provision), prior to the stated maturity
thereof; or
(f) the Loan Documents and the Orders shall, for any reason, cease to
create a valid Lien on any of the Collateral purported to be covered thereby
or such Lien shall cease to be a perfected Lien having the priority provided
herein pursuant to section 364 of the Bankruptcy Code against each Loan Party,
or any Loan Party shall so allege in any pleading filed in any court or any
material provision of any Loan Document shall, for any reason, cease to be
valid and binding on each Loan Party party thereto or any Loan Party shall so
state in writing; or
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(g) one or more judgments or orders (or other similar process)
involving, in the case of money judgments, an aggregate amount in excess of
$1,000,000, to the extent not covered by insurance, shall be rendered against
one or more of any Loan Party and its Subsidiaries and either (i) enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order or (ii) there shall be any period of 10 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal
or otherwise, shall not be in effect; or
(h) an ERISA Event (other than the Cases) shall occur and the amount
of all liabilities and deficiencies resulting therefrom, whether or not
assessed, exceeds $1,000,000 in the aggregate; or
(i) there shall occur any Change of Control; or
(j) any of the Cases shall be dismissed (or the Bankruptcy Court
shall make a ruling requiring the dismissal of the Cases), suspended or
converted to a case under chapter 7 of the Bankruptcy Code, or any Loan Party
shall file any pleading requesting any such relief; or an application shall be
filed by any Loan Party for the approval of, or there shall arise, (i) any
other Claim having priority senior to or pari passu with the claims of the
Administrative Agent and the Lenders under the Loan Documents or any other
claim having priority over any or all administrative expenses of the kind
specified in sections 503(b) or 507(b) of the Bankruptcy Code (other than the
Carve-Out) or (ii) any Lien on the Collateral having a priority senior to or
pari passu with the Liens and security interests granted herein, except as
expressly provided herein; or
(k) any Loan Party shall file a motion seeking, or the Bankruptcy
Court shall enter, an order (i) approving payment of any prepetition Claim
(other than Permitted Prepeptition Claim Payments), (ii) granting relief from
the automatic stay applicable under section 362 of the Bankruptcy Code to any
holder of any security interest to permit foreclosure on any assets (other
than certain assets identified by the Borrower and agreed to by the
Administrative Agent) having a book value in excess of $1,000,000 in the
aggregate, (iii) except to the extent the same would not constitute a Default
under any of the previous clauses, approving any settlement or other
stipulation with any creditor of any Loan Party, other than the Administrative
Agent and the Lenders, or otherwise providing for payments as adequate
protection or otherwise to such creditor individually or in the aggregate in
excess of $100,000 for any and all such creditors; or (iv) approving payment
of or granting any adequate protection with respect to pre-petition
Indebtedness (other than Permitted Prepeptition Claim Payments or otherwise as
approved by the Administrative Agent in its sole discretion, the Requisite
Lenders and the Bankruptcy Court, and subject to exceptions for payments made
pursuant to orders made prior to the Closing Date, and other exceptions, which
are in each case acceptable to the Administrative Agent in it sole discretion,
provided, however, that any extension or replacement, without the approval of
the Administrative Agent in its sole discretion, of any adequate protection or
budget approval rights granted pursuant to such orders of the Bankruptcy Court
made on or prior to the Closing Date shall in any event constitute an Event of
Default); or
(l) (i) the Interim Order shall cease to be in full force and effect
and the Final Order shall not have been entered prior to such cessation, or
(ii) the Final Order shall not have been entered by the Bankruptcy Court on or
before the 30th day following the Closing Date, or (iii) from and after the
date of entry thereof, the Final Order shall cease to be in full force and
effect, or (iv) any Loan Party shall fail to comply with the terms of the
Interim Order or the Final Order in any material respect, or (v) the Interim
Order or the Final Order shall be amended, supplemented, stayed, reversed,
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vacated or otherwise modified (or any of the Loan Parties shall apply for
authority to do so) without the written consent of the Requisite Lenders; or
(m) the Bankruptcy Court shall enter an order appointing a trustee,
responsible officer or an examiner with powers beyond the duty to investigate
and report, as set forth in section 1106(a)(3) and (4) of the Bankruptcy Code,
in any of the Cases; or
(n) one or more of the Borrower and its Subsidiaries shall have
entered into one or more consent or settlement decrees or agreements or
similar arrangements with a Governmental Authority or one or more judgments,
orders, decrees or similar actions shall have been entered against one or more
of the Borrower and its Subsidiaries based on or arising from the violation of
or pursuant to any Environmental Law, or the generation, storage,
transportation, treatment, disposal or Release of any Contaminant and, in
connection with all the foregoing, the Borrower and its Subsidiaries are
likely to incur Environmental Liabilities and Costs that would have a Material
Adverse Effect; or
(o) at any time on or after April 30, 2005 (unless the Incremental
Facility Effective Date has occurred), the results of Citicorp's continuing
due diligence investigation with respect to the Borrower and its Subsidiaries
(other than any matter disclosed to the Administrative Agent and the Lenders
in writing on or prior to the Closing Date) shall prove unsatisfactory, as
reasonably determined by the Administrative Agent and the Requisite Lenders;
or
(p) the exclusive period that the Loan Parties have to file a plan of
reorganization under the Cases shall terminate or be otherwise lifted without
the Loan Parties having filed such a plan and a third party files such a plan
which is not acceptable to the Loan Parties and the Administrative Agent, or a
plan of reorganization is filed which does not provide for the payment in full
of the Obligations on or prior to the date of consummation thereof; or
(q) the Equity Cushion shall at any time be less than $31,000,000 or
(in the event that any Equity Cushion requirement set forth in any Order is
increased to $40,000,000) $41,000,000; or
(r) the Borrower and the Administrative Agent shall fail to agree
upon the financial covenant levels in Sections 5.1(a), 5.1(b) and 5.2 by the
earlier of (i) the Incremental Facility Effective Date and (ii) April 30,
2005.
Section 9.2. Remedies. During the continuance of any Event of
Default, without further order of, application to, or action by, the
Bankruptcy Court, the Administrative Agent (a) may, and, at the request of the
Requisite Lenders, shall by notice to the Borrower declare that all or any
portion of the Revolving Credit Commitments be terminated, whereupon the
obligation of each Revolving Credit Lender to make any Loan and each Issuer to
Issue any Letter of Credit shall immediately terminate, and (b) may, and, at
the request of the Requisite Lenders, shall by notice to the Borrower, declare
the Loans, all interest thereon and all other amounts and Obligations payable
under this Agreement to be forthwith due and payable, whereupon the Loans, all
such interest and all such amounts and Obligations shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower.
In addition, subject solely to any requirement of the giving of notice by the
terms of the Interim Order or the Final Order, the automatic stay provided in
section 362 of the Bankruptcy Code shall be deemed automatically vacated
without further action or order of the Bankruptcy Court and the Administrative
Agent and the Lenders shall be entitled to exercise all of their respective
rights and remedies under the Loan Documents, including, without limitation,
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all rights and remedies with respect to the Collateral and the Subsidiary
Guarantors. In addition to the remedies set forth above, subject solely to any
requirement of the giving of notice by the terms of the Interim Order or the
Final Order, the Administrative Agent may exercise any remedies provided for
by this Agreement and the Collateral Documents in accordance with the terms
hereof and thereof or any other remedies provided by applicable law.
Section 9.3. Actions in Respect of Letters of Credit. At any time (i)
upon the Revolving Credit Termination Date, (ii) after the Revolving Credit
Termination Date when the aggregate funds on deposit in Cash Collateral
Accounts shall be less than 105% of the Letter of Credit Obligations, and
(iii) as may be required by Section 2.4(b) or Section 2.9(b) or (c) (Mandatory
Prepayments), the Borrower shall pay to the Administrative Agent in
immediately available funds at the Administrative Agent's office referred to
in Section 13.8, for deposit in a Cash Collateral Account, (x) in the case of
clauses (i) and (ii) above, the amount required to that, after such payment,
the aggregate funds on deposit in the Cash Collateral Accounts equals or
exceeds 105% of the sum of all outstanding Letter of Credit Obligations and
(y) in the case of clause (iii) above, the amount required by Section 2.4(b)
or Section 2.9(b) or (c) (Mandatory Prepayments). The Administrative Agent
may, from time to time after funds are deposited in any Cash Collateral
Account, apply funds then held in such Cash Collateral Account to the payment
of any amounts, in accordance with Section 2.9(d) and 2.13(g), as shall have
become or shall become due and payable by the Borrower to the Issuers or the
Lenders in respect of the Letter of Credit Obligations. The Administrative
Agent shall promptly give written notice of any such application; provided,
however, that the failure to give such written notice shall not invalidate any
such application.
Section 9.4. Rescission. If at any time after termination of the
Revolving Credit Commitments or acceleration of the maturity of the Loans, the
Borrower shall pay all arrears of interest and all payments on account of
principal of the Loans and Reimbursement Obligations which shall have become
due otherwise than by acceleration (with interest on principal and, to the
extent permitted by law, on overdue interest, at the rates specified herein)
and all Events of Default and Defaults (other than non-payment of principal of
and accrued interest on the Loans due and payable solely by virtue of
acceleration) shall be remedied or waived pursuant to Section 13.1, then upon
the written consent of the Requisite Lenders and written notice to the
Borrower, the termination of the Revolving Credit Commitments or the
acceleration and their consequences may be rescinded and annulled; provided,
however, that such action shall not affect any subsequent Event of Default or
Default or impair any right or remedy consequent thereon. The provisions of
the preceding sentence are intended merely to bind the Lenders and the Issuers
to a decision which may be made at the election of the Requisite Lenders and
such provisions are not intended to benefit the Borrower and do not give the
Borrower the right to require the Lenders to rescind or annul any acceleration
hereunder, even if the conditions set forth herein are met.
ARTICLE X
GUARANTY
Section 10.1. The Guaranty. In order to induce the Lenders to enter
into this Agreement and to extend credit hereunder and in recognition of the
direct benefits to be received by each Subsidiary Guarantor from the proceeds
of the Loans and the issuance of the Letters of Credit, each Subsidiary
Guarantor hereby agrees with the Administrative Agent and the Lenders that
such Subsidiary Guarantor hereby unconditionally and irrevocably, jointly and
severally, guarantees as primary obligor and not merely as surety the full and
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prompt payment when due, whether upon maturity, by acceleration or otherwise,
of any and all of (i) the Obligations and (ii) all other amounts, obligations,
covenants and duties owing by the Borrower to the Administrative Agent, any
Lender, any Issuer, any Affiliate of any of them or any Indemnitee, of every
type and description (whether by reason of an extension of credit, opening or
amendment of a letter of credit or payment of any draft drawn or other payment
thereunder, loan, guaranty, indemnification, foreign exchange or currency swap
transaction, interest rate hedging transaction or otherwise), present or
future, arising under each Hedging Contract between the Borrower and any
Person that was a Lender or an Affiliate of a Lender at the time it entered
into such Hedging Contract and each Cash Management Document. If any or all of
the Obligations become due and payable hereunder, each Subsidiary Guarantor,
jointly and severally, unconditionally promises to pay such Obligations to the
Lenders, or order, on demand, together with any and all reasonable expenses
which may be incurred by the Administrative Agent or the Lenders in collecting
any of the Obligations.
Section 10.2. Nature of Liability. The liability of each Subsidiary
Guarantor hereunder is exclusive and independent of any security for or other
guaranty of the Obligations whether executed by such Subsidiary Guarantor, any
other Subsidiary Guarantor, any other guarantor or by any other party, and the
liability of each Subsidiary Guarantor hereunder shall not be affected or
impaired by (a) any direction as to application of payment by the Borrower or
by any other party, or (b) any other continuing or other guaranty, undertaking
or maximum liability of a guarantor or of any other party as to the
Obligations of the Borrower, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any dissolution, termination or
increase, decrease or change in personnel by the Borrower, or (e) any payment
made to the Administrative Agent or the Lenders in respect of the Obligations
which the Administrative Agent or such Lenders repay to the Borrower pursuant
to court order in any bankruptcy, reorganization, arrangement, moratorium or
other debtor relief proceeding, and each Subsidiary Guarantor waives any right
to the deferral or modification of its obligations hereunder by reason of any
such proceeding.
Section 10.3. Independent Obligation. The obligations of each
Subsidiary Guarantor hereunder are independent of the obligations of any other
Subsidiary Guarantor, any other guarantor or the Borrower, and a separate
action or actions may be brought and prosecuted against each Subsidiary
Guarantor whether or not action is brought against any other Subsidiary
Guarantor, any other guarantor or the Borrower and whether or not any other
Subsidiary Guarantor, any other guarantor or the Borrower be joined in any
such action or actions. Each Subsidiary Guarantor waives, to the fullest
extent permitted by law, the benefit of any statute of limitations affecting
its liability hereunder or the enforcement thereof. Any payment by the
Borrower or other circumstance which operates to toll any statute of
limitations as to the Borrower shall operate to toll the statute of
limitations as to the Subsidiary Guarantor.
Section 10.4. Authorization. Each Subsidiary Guarantor authorizes the
Administrative Agent and the Lenders without notice or demand (except as shall
be required by applicable statute and cannot be waived), and without affecting
or impairing its liability hereunder, from time to time to:
(a) change the manner, place or terms of payment of, and/or change or
extend the time of payment of, renew, increase, accelerate or alter, any of
the Obligations (including any increase or decrease in the rate of interest
thereon), any security therefor, or any liability incurred directly or
indirectly in respect thereof, and the Guaranty herein made shall apply to the
Obligations as so changed, extended, renewed or altered;
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(b) take and hold security for the payment of the Obligations and
sell, exchange, release, surrender, realize upon or otherwise deal with in any
manner and in any order any property by whomsoever at any time pledged or
mortgaged to secure, or howsoever securing, the Obligations or any liabilities
(including any of those hereunder) incurred directly or indirectly in respect
thereof or hereof, and/or any offset there against;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers, Subsidiary
Guarantors, the Borrower or other obligors;
(e) settle or compromise any of the Obligations, any security
therefor or any liability (including any of those hereunder) incurred directly
or indirectly in respect thereof or hereof, or subordinate the payment of all
or any part thereof to the payment of any liability (whether due or not) of
the Borrower to its creditors;
(f) apply, subject to the other provisions of this Agreement, any
sums by whomsoever paid or howsoever realized to any liability or liabilities
of the Borrower to the Lenders regardless of what liability or liabilities of
such Subsidiary Guarantor or the Borrower remain unpaid; and/or
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements referred
to herein, or otherwise amend, modify or supplement this Agreement or any of
such other instruments or agreements.
Section 10.5. Reliance. It is not necessary for the Administrative
Agent or the Lenders to inquire into the capacity or powers of the Borrower or
its Subsidiaries or the officers, directors, partners or agents acting or
purporting to act on its behalf, and any Obligations made or created in
reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
Section 10.6. Subordination. Any of the Indebtedness of the Borrower
now or hereafter owing to any Subsidiary Guarantor is hereby subordinated to
the Obligations; provided, however, that payment may be made by the Borrower
on any such Indebtedness owing to such Subsidiary Guarantor so long as the
same is not prohibited by this Agreement; and provided further, that if the
Administrative Agent so requests at a time when an Event of Default exists,
all such Indebtedness of the Borrower to such Subsidiary Guarantor shall be
collected, enforced and received by such Subsidiary Guarantor as trustee for
the Lenders and be paid over to the Administrative Agent on behalf of the
Lenders on account of the Obligations of the Borrower to Lenders, but without
affecting or impairing in any manner the liability of such Subsidiary
Guarantor under the other provisions of this Guaranty. Prior to the transfer
by any Subsidiary Guarantor of any note or negotiable instrument evidencing
any of the Indebtedness of the Borrower to such Subsidiary Guarantor, such
Subsidiary Guarantor shall xxxx such note or negotiable instrument with a
legend that the same is subject to this subordination.
Section 10.7. Waiver.
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(a) Each Subsidiary Guarantor waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or the Lenders to (i) proceed against the Borrower, any
other Subsidiary Guarantor, any other guarantor or any other party, (ii)
proceed against or exhaust any security held from the Borrower, any other
Subsidiary Guarantor, any other guarantor or any other party or (iii) pursue
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any other remedy in the Administrative Agent's or the Lenders' power
whatsoever. Each Subsidiary Guarantor waives (except as shall be required by
applicable statute and cannot be waived) any defense based on or arising out
of any defense of the Borrower, any other Subsidiary Guarantor, any other
guarantor or any other party other than payment in full of the Obligations,
including, without limitation, any defense based on or arising out of the
disability of the Borrower, any other Subsidiary Guarantor, any other
guarantor or any other party, or the unenforceability of the Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of the Borrower other than payment in full of the Obligations.
Subject to any requirement of the giving of notice in the Orders, the
Administrative Agent and the Lenders may, at their election, foreclose on any
security held by the Administrative Agent or the Lenders by one or more
judicial or nonjudicial sales, whether or not every aspect of any such sale is
commercially reasonable (to the extent such sale is permitted by applicable
law), or exercise any other right or remedy the Administrative Agent and the
Lenders may have against the Borrower or any other party, or any security,
without affecting or impairing in any way the liability of any Subsidiary
Guarantor hereunder except to the extent the Obligations have been paid. Each
Subsidiary Guarantor waives any defense arising out of any such election by
the Administrative Agent and the Lenders, even though such election operates
to impair or extinguish any right of reimbursement or subrogation or other
right or remedy of such Subsidiary Guarantor against the Borrower or any other
party or any security.
(b) Each Subsidiary Guarantor waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Guaranty, and notices of the existence, creation or incurring of new
or additional Obligations. Each Subsidiary Guarantor assumes all
responsibility for being and keeping itself informed of the Borrower's
financial condition and assets, and of all other circumstances bearing upon
the risk of nonpayment of the Obligations and the nature, scope and extent of
the risks which such Subsidiary Guarantor assumes and incurs hereunder, and
agrees that the Administrative Agent and the Lenders shall have no duty to
advise such Subsidiary Guarantor of information known to them regarding such
circumstances or risks.
Section 10.8. Limitation on Enforcement. The Lenders agree that this
Guaranty may be enforced only by the action of the Administrative Agent, in
each case acting upon the instructions of the Requisite Lenders, and that no
Lender shall have any right individually to seek to enforce or to enforce this
Guaranty it being understood and agreed that such rights and remedies may be
exercised by the Administrative Agent for the benefit of the Lenders upon the
terms of this Agreement.
ARTICLE XI
SECURITY
Section 11.1. Security.
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(a) To induce the Lenders to make the Revolving Loans, the Issuers to
issue Letters of Credit, and the Swing Loan Lenders to make the Swing Loans,
each Loan Party hereby grants to the Administrative Agent, for itself and for
the ratable benefit of the Secured Parties, as security for the full and
prompt payment when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations of such Loan Party, a continuing first
priority Lien and security interest (subject only to (i) valid, perfected,
nonavoidable and enforceable Liens existing as of the Petition Date, other
than the Liens on the Collateral securing Prepetition Secured Indebtedness,
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(ii) the Carve-Out, (iii) Liens permitted under Section 8.2 (d) and (iv)
post-petition Liens permitted under Section 8.2(c), (e) and (i)) in accordance
with sections 364(c)(2) and (3) and 364(d)(1) of the Bankruptcy Code in and to
all Collateral of such Loan Party. For purposes of this Agreement, all of the
following property now owned or at any time hereafter acquired by a Loan Party
or in which a Loan Party now has or at any time in the future may acquire any
right, title or interests is collectively referred to as the "Collateral":
(i) all Accounts;
(ii) all Chattel Paper;
(iii) all Deposit Accounts;
(iv) all Documents;
(v) all Equipment;
(vi) all General Intangibles, including all Intellectual
Property;
(vii) all Instruments;
(viii) all Inventory;
(ix) all Investment Property;
(x) all Letter of Credit Rights;
(xi) all Real Property;
(xii) all Vehicles;
(xiii) all Commercial Tort Claims, including those described on
Schedule 11.1;
(xiv) all books and records pertaining to the property described
in this Section 11.1;
(xv) all other goods and personal property of such Loan Party,
whether tangible or intangible, wherever located, including money,
letters of credit and all rights of payment or performance under
letters of credit;
(xvi) all property of any Loan Party held by the Administrative
Agent or any Secured Party, including all property of every
description, in the possession or custody of or in transit to the
Administrative Agent or such Secured Party for any purpose, including
safekeeping, collection or pledge, for the account of such Loan
Party, or as to which such Loan Party may have any right or power;
(xvii) to the extent not otherwise included, all monies and
other property of any kind which is, after the Petition Date,
received by such Loan Party in connection with refunds with respect
to taxes, assessments and governmental charges imposed on such Loan
Party or any of its property or income;
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(xviii) to the extent not otherwise included, all causes of
action (other than Avoidance Actions) and all monies and other
property of any kind received therefrom, and all monies and other
property of any kind recovered by any Loan Party;
(xix) all insurance claims; and
(xx) to the extent not otherwise included, all Proceeds of each
of the foregoing and all accessions to, substitutions and
replacements for, and rents, profits and products of, each of the
foregoing, any and all proceeds of insurance, indemnity, warranty or
guaranty payable to any Loan Party from time to time with respect to
any of the foregoing;
provided, however, that the Collateral shall not include any Real Property
lease held by any Loan Party; provided, further that (notwithstanding the
foregoing) the Collateral shall in any event include all Proceeds,
substitutions or replacements of any such Real Property lease (except in the
case of a substitution or replacement thereof which is a Real Property lease).
Section 11.2. Perfection of Security Interests.
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(a) Each Loan Party shall, at its expense, perform any and all steps
that may be reasonably requested by the Administrative Agent at any time to
perfect, maintain, protect, and enforce the Lenders' security interest in the
Collateral of such Loan Party, including, without limitation, (i) executing
and filing financing or continuation statements, and amendments thereof, in
form and substance satisfactory to the Administrative Agent, (ii) maintaining
complete and accurate stock records, (iii) upon the request of the
Administrative Agent, using its best efforts in delivering to the
Administrative Agent negotiable warehouse receipts, if any, and, upon the
Administrative Agent's request therefor, non-negotiable warehouse receipts
covering any portion of the Collateral located in warehouses and for which
warehouse receipts are issued, (iv) upon the request of the Administrative
Agent during the continuance of an Event of Default, placing notations on such
Loan Party's books of account to disclose the Administrative Agent's security
interest therein, (v) to the extent requested by the Administrative Agent,
delivering to the Administrative Agent all documents, certificates and
Instruments necessary or desirable to perfect the Administrative Agent's Lien
in letters of credit on which such Loan Party is named as beneficiary and all
acceptances issued in connection therewith, (vi) after the occurrence and
during the continuation of an Event of Default, transferring Inventory
maintained in warehouses to other warehouses designated by the Administrative
Agent and (vii) taking such other steps as are deemed necessary or desirable
to maintain the Administrative Agent's security interest in the Collateral.
(b) Each Loan Party hereby authorizes the Administrative Agent to
execute and file financing statements or continuation statements, and
amendments thereto, on such Loan Party's behalf covering the Collateral. The
Administrative Agent may file one or more financing statements disclosing the
Administrative Agent's security interest under this Agreement without the
signature of such Loan Party appearing thereon. Each Loan Party shall pay the
costs of, or incidental to, any recording or filing of any financing
statements concerning the Collateral. Each Loan Party agrees that a carbon,
photographic, photostatic, or other reproduction of this Agreement or of a
financing statement is sufficient as a financing statement. If any Collateral
is at any time in the possession or control of any warehouseman, bailee or
such Loan Party's agents or processors, upon the request of the Administrative
Agent, such Loan Party shall notify such warehouseman, bailee, agents or
processors of the Administrative Agent's security interest, which notification
shall specify that such Person shall, upon the occurrence and during the
continuance of an Event of Default, hold all such Collateral for the
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Administrative Agent's account subject to the Administrative Agent's
instructions. From time to time, each Loan Party shall, upon the
Administrative Agent's request, execute and deliver written instruments
pledging to the Administrative Agent the Collateral described in any such
instruments or otherwise, but the failure of such Loan Party to execute and
deliver such confirmatory instruments shall not affect or limit the
Administrative Agent's security interest or other rights in and to the
Collateral. Until all Obligations have been fully satisfied and the Revolving
Credit Commitments shall have been terminated, the Administrative Agent's
security interest in the Collateral, and all Proceeds and products thereof,
shall continue in full force and effect.
(c) Notwithstanding subsections (a) and (b) of this Section 11.2, or
any failure on the part of any Loan Party or the Administrative Agent to take
any of the actions set forth in such subsections, the Liens and security
interests granted herein shall be deemed valid, enforceable and perfected by
entry of the Interim Order and the Final Order, as applicable. No financing
statement, notice of lien, mortgage, deed of trust or similar instrument in
any jurisdiction or filing office need be filed or any other action taken in
order to validate and perfect the Liens and security interests granted by or
pursuant to this Agreement, the Interim Order or the Final Order.
Section 11.3. Rights of Lender; Limitations on Lenders' Obligations.
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(a) Subject to each Loan Party's rights and duties under the
Bankruptcy Code (including section 365 of the Bankruptcy Code), it is
expressly agreed by each Loan Party that, anything herein to the contrary
notwithstanding, such Loan Party shall remain liable under its post-petition
Contractual Obligations to observe and perform all the conditions and
obligations to be observed and performed by it thereunder. Neither the
Administrative Agent nor any Secured Party shall have any obligation or
liability under any Contractual Obligations by reason of or arising out of
this Agreement, the Loan Documents, or the granting to the Administrative
Agent of a security interest therein or the receipt by the Administrative
Agent or any Lender of any payment relating to any Contractual Obligations
pursuant hereto, nor shall the Administrative Agent be required or obligated
in any manner to perform or fulfill any of the obligations of any Loan Party
under or pursuant to any Contractual Obligations, or to make any payment, or
to make any inquiry as to the nature or the sufficiency of any payment
received by it or the sufficiency of any performance by any party under any
Contractual Obligations, or to present or file any claim, or to take any
action to collect or enforce any performance or the payment of any amounts
which may have been assigned to it or to which it may be entitled at any time
or times.
(b) Subject to Section 11.5 hereof, the Administrative Agent
authorizes each Loan Party to collect its Accounts, provided that such
collection is performed in accordance with such Loan Party's customary
procedures, and the Administrative Agent may, upon the occurrence and during
the continuation of any Event of Default and without notice, other than any
requirement of notice provided in the Orders, limit or terminate said
authority at any time.
(c) Subject to any requirement of notice provided in the Orders, the
Administrative Agent may at any time, upon the occurrence and during the
continuation of any Event of Default, after first notifying the Borrower of
its intention to do so, notify Account Debtors, notify the other parties to
the Contractual Obligations of the Borrower or any other Loan Party, notify
obligors of Instruments and Investment Property of the Borrower or any other
Loan Party and notify obligors in respect of Chattel Paper of the Borrower or
any other Loan Party that the right, title and interest of the Borrower or
such Loan Party in and under such Accounts, such Contractual Obligations, such
Instruments, such Investment Property and such Chattel Paper have been
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assigned to the Administrative Agent and that payments shall be made directly
to the Administrative Agent. Subject to any requirement of notice provided in
the Orders, upon the request of the Administrative Agent, the Borrower or such
other Loan Party will so notify such Account Debtors, such parties to
Contractual Obligations, obligors of such Instruments and Investment Property
and obligors in respect of such Chattel Paper. Subject to any requirement of
notice provided in the Orders, upon the occurrence and during the continuation
of an Event of Default, the Administrative Agent may in its own name, or in
the name of others, communicate with such parties to such Accounts,
Contractual Obligations, Instruments, Investment Property and Chattel Paper to
verify with such Persons to the Administrative Agent's reasonable satisfaction
the existence, amount and terms of any such Accounts, Contractual Obligations,
Instruments, Investment Property or Chattel Paper.
Section 11.4. Covenants of the Loan Parties with Respect to
Collateral. Each Loan Party hereby covenants and agrees with the
Administrative Agent that from and after the date of this Agreement and until
the Obligations are fully satisfied:
(a) Maintenance of Records. Such Loan Party will keep and maintain,
at its own cost and expense, satisfactory and complete records of the
Collateral, in all material respects, including, without limitation, a record
of all payments received and all credits granted with respect to the
Collateral and all other dealings concerning the Collateral. For the
Administrative Agent's further security, each Loan Party agrees that the
Administrative Agent shall have a property interest in all of such Loan
Party's books and records pertaining to the Collateral and, upon the
occurrence and during the continuation of an Event of Default, such Loan Party
shall deliver and turn over any such books and records to the Administrative
Agent or to its representatives at any time on demand of the Administrative
Agent.
(b) Indemnification With Respect to Collateral. In any suit,
proceeding or action brought by the Administrative Agent relating to any
Account, Chattel Paper, Contractual Obligations, General Intangible,
Investment Property, Instrument, Intellectual Property or other Collateral for
any sum owing thereunder or to enforce any provision of any Account, Chattel
Paper, Contractual Obligations, General Intangible, Investment Property,
Instrument, Intellectual Property or other Collateral, such Loan Party will
save, indemnify and keep the Secured Parties harmless from and against all
expense, loss or damage suffered by the Secured Parties by reason of any
defense, setoff, counterclaim, recoupment or reduction of liability whatsoever
of the obligor thereunder, arising out of a breach by such Loan Party of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to, or in favor of, such obligor or its successors
from such Loan Party, and all such obligations of such Loan Party shall be and
remain enforceable against and only against such Loan Party and shall not be
enforceable against the Administrative Agent.
(c) Limitation on Liens on Collateral. Such Loan Party will not
create, permit or suffer to exist, and will defend the Collateral against and
take such other action as is necessary to remove, any Lien on the Collateral
except Liens permitted under Section 8.2 and will defend the right, title and
interest of the Administrative Agent in and to all of such Loan Party's rights
under the Chattel Paper, Leases, Real Estate, Contracts, Documents, General
Intangibles, Instruments, Investment Property and to the Intellectual
Property, Equipment and Inventory and in and to the Proceeds thereof against
the claims and demands of all Persons whomsoever other than claims or demands
arising out of Liens permitted under Section 8.2.
(d) Limitations on Modifications of Accounts. Such Loan Party will
not, without the Administrative Agent's prior written consent, grant any
extension of the time of payment of any of the Accounts, Chattel Paper or
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Instruments, compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any Person liable for the payment
thereof, or allow any credit or discount whatsoever thereon other than any of
the foregoing which are done in the ordinary course of business, consistent in
all material respects with past practices and trade discounts granted in the
ordinary course of business of such Loan Party.
(e) Notices. Such Loan Party will advise the Lenders promptly, in
reasonable detail, (i) of any Lien asserted against any of the Collateral
other than Liens permitted under Section 8.2, and (ii) of the occurrence of
any other event which would result in a material adverse change with respect
to the aggregate value of the Collateral or on the security interests created
hereunder.
(f) Maintenance of Equipment. Such Loan Party will keep and maintain
the Equipment in good operating condition sufficient for the continuation of
the business conducted by such Loan Party on a basis consistent with past
practices, ordinary wear and tear excepted, except where the failure to so
keep and maintain the Equipment would not, in the aggregate, have a Material
Adverse Effect.
(g) Pledged Collateral.
(i) Upon request of the Administrative Agent made at any time
on or after the Incremental Facility Effective Date, such Loan Party
will (x) deliver to the Administrative Agent, all certificates or
Instruments representing or evidencing any Pledged Collateral,
whether now arising or hereafter acquired, in suitable form for
transfer by delivery or, as applicable, accompanied by such Loan
Party's endorsement, where necessary, or duly executed instruments of
transfer or assignment in blank, all in form and substance
satisfactory to the Administrative Agent, together with a Pledge
Amendment, duly executed by the Loan Party, in substantially the form
of Exhibit M (a "Pledge Amendment"), in respect of such Additional
Pledged Collateral and authorizes the Administrative Agent to attach
each Pledge Amendment to this Agreement and (y) maintain all other
Pledged Collateral constituting Investment Property in a Control
Account. If an Event of Default has occurred and is continuing, the
Administrative Agent shall have the right, in its discretion and
without notice to the Loan Party, to transfer to or to register in
its name or in the name of its nominees any or all of the Pledged
Collateral. The Administrative Agent shall have the right at any time
to exchange certificates or instruments representing or evidencing
any of the Pledged Collateral for certificates or instruments of
smaller or larger denominations.
(ii) Except as provided in Section 11.7, such Loan Party shall
be entitled to receive all cash dividends paid in respect of the
Pledged Collateral (other than liquidating or distributing dividends)
with respect to the Pledged Collateral. Any sums paid upon or in
respect of any of the Pledged Collateral upon the liquidation or
dissolution of any issuer of any of the Pledged Collateral, any
distribution of capital made on or in respect of any of the Pledged
Collateral or any property distributed upon or with respect to any of
the Pledged Collateral pursuant to the recapitalization or
reclassification of the capital of any issuer of Pledged Collateral
or pursuant to the reorganization thereof shall, unless otherwise
subject to a perfected security interest in favor of the
Administrative Agent, be delivered to the Administrative Agent to be
held by it hereunder as additional collateral security for the
Secured Obligations. If any sums of money or property so paid or
distributed in respect of any of the Pledged Collateral shall be
received by such Loan Party, such Loan Party shall, until such money
or property is paid or delivered to the Administrative Agent, hold
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such money or property in trust for the Administrative Agent, as
additional security for the Secured Obligations.
(iii) Except as provided in Section 11.7, such Loan Party will
be entitled to exercise all voting, consent and corporate rights with
respect to the Pledged Collateral; provided, however, that no vote
shall be cast, consent given or right exercised or other action taken
by such Loan Party which would impair the Collateral in any manner
that would cause a Material Adverse Effect or which would be
inconsistent with or result in any violation of any provision of this
Agreement or any other Loan Document.
(iv) Such Loan Party shall not hereafter grant Control over any
Investment Property to any Person other than the Administrative
Agent.
(v) In the case of each Loan Party which is an issuer of
Pledged Collateral, such Loan Party agrees to be bound by the terms
of this Agreement relating to the Pledged Collateral issued by it and
will comply with such terms insofar as such terms are applicable to
it. In the case of each Loan Party which is a partner in a
Partnership, such Loan Party hereby consents to the extent required
by the applicable Partnership Agreement to the pledge by each other
Loan Party, pursuant to the terms hereof, of the Pledged Partnership
Interests in such Partnership and to the transfer of such Pledged
Partnership Interests to the Administrative Agent or its nominee and
to the substitution of the Administrative Agent or its nominee as a
substituted partner in such Partnership with all the rights, powers
and duties of a general partner or a limited partner, as the case may
be. In the case of each Loan Party which is a member of an LLC, such
Loan Party hereby consents to the extent required by the applicable
LLC Agreement to the pledge by each other Loan Party, pursuant to the
terms hereof, of the Pledged LLC Interests in such LLC and to the
transfer of such Pledged LLC Interests to the Administrative Agent or
its nominee and to the substitution of the Administrative Agent or
its nominee as a substituted member of the LLC with all the rights,
powers and duties of a member of the LLC in question.
(vi) Such Loan Party will not agree to any amendment of an LLC
Agreement or Partnership Agreement that in any way adversely affects
the perfection of the security interest of the Administrative Agent
in the Pledged Partnership Interests or Pledged LLC Interests pledged
by such Loan Party hereunder, including electing to treat the
membership interest or partnership interest of such Loan Party as a
security under Section 8-103 of the UCC.
(h) Intellectual Property.
(i) Such Loan Party (either itself or through licensees) will
(i) continue to use each Trademark that is Material Intellectual
Property in order to maintain such Trademark in full force and effect
with respect to each class of goods for which such Trademark is
currently used, free from any claim of abandonment for non-use, (ii)
maintain as in the past the quality of products and services offered
under such Trademark, (iii) use such Trademark with the appropriate
notice of registration and all other notices and legends required by
applicable Requirements of Law, (iv) not adopt or use any xxxx which
is confusingly similar or a colorable imitation of such Trademark
unless the Administrative Agent shall obtain a perfected security
interest in such xxxx pursuant to this Agreement and (v) not (and not
permit any licensee or sublicensee thereof to) do any act or
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knowingly omit to do any act whereby such Trademark may become
invalidated or impaired in any way.
(ii) Such Loan Party (either itself or through licensees) will
not do any act, or omit to do any act, whereby any Patent which is
Material Intellectual Property may become forfeited, abandoned or
dedicated to the public.
(iii) Such Loan Party (either itself or through licensees) (i)
will not (and will not permit any licensee or sublicensee thereof to)
do any act or omit to do any act whereby any portion of the
Copyrights which is Material Intellectual Property may become
invalidated or otherwise impaired and (ii) will not (either itself or
through licensees) do any act whereby any portion of the Copyrights
which is Material Intellectual Property may fall into the public
domain.
(iv) Such Loan Party (either itself or through licensees) will
not do any act, or omit to do any act, whereby any trade secret which
is Material Intellectual Property may become publicly available or
otherwise unprotectable.
(v) Such Loan Party (either itself or through licensees) will
not do any act that knowingly uses any Material Intellectual Property
to infringe the intellectual property rights of any other Person.
(vi) Such Loan Party will notify the Administrative Agent
immediately if it knows, or has reason to know, that any application
or registration relating to any Material Intellectual Property may
become forfeited, abandoned or dedicated to the public, or of any
adverse determination or development (including the institution of,
or any such determination or development in, any proceeding in the
United States Patent and Trademark Office, the United States
Copyright Office or any court or tribunal in any country) regarding
such Loan Party's ownership of, right to use, interest in, or the
validity of, any Material Intellectual Property or such Loan Party's
right to register the same or to own and maintain the same.
(vii) Whenever such Loan Party, either by itself or through any
agent, licensee or designee, shall file an application for the
registration of any Intellectual Property with the United States
Patent and Trademark Office, the United States Copyright Office or
any similar office or agency within or outside the United States,
such Loan Party shall report such filing to the Administrative Agent
within five Business Days after the last day of the fiscal quarter in
which such filing occurs. Upon request of the Administrative Agent,
such Loan Party shall execute and deliver, and have recorded, any and
all agreements, instruments, documents, and papers as the
Administrative Agent may request to evidence the Administrative
Agent's security interest in any Copyright, Patent or Trademark and
the goodwill and general intangibles of such Loan Party relating
thereto or represented thereby.
(viii) Such Loan Party will take all reasonable actions
necessary or requested by the Administrative Agent, including in any
proceeding before the United States Patent and Trademark Office, the
United States Copyright Office or any similar office or agency, to
maintain and pursue each application (and to obtain the relevant
registration) and to maintain each registration of any Copyright,
Trademark or Patent that is Material Intellectual Property, including
filing of applications for renewal, affidavits of use, affidavits of
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incontestability and opposition and interference and cancellation
proceedings.
(ix) In the event that any Material Intellectual Property is
infringed upon or misappropriated or diluted by a third party, such
Loan Party shall notify the Administrative Agent promptly after such
Loan Party learns thereof. Such Loan Party shall take appropriate
action in response to such infringement, misappropriation of
dilution, including promptly bringing suit for infringement,
misappropriation or dilution and to recover any and all damages for
such infringement, misappropriation of dilution, and shall take such
other actions may be appropriate in its reasonable judgment under the
circumstances to protect such Material Intellectual Property.
(i) Commercial Tort Claims. The only Commercial Tort Claims of any
Loan Party existing on the date hereof (regardless of whether the amount,
defendant or other material facts can be determined) are those listed on
Schedule 11.1, which sets forth such information separately for each Loan
Party. Such Loan Party agrees that, if it shall acquire any interest in any
Commercial Tort Claim (whether from another Person or because such Commercial
Tort Claim shall have come into existence), (i) such Loan Party shall,
promptly following such acquisition, deliver to the Administrative Agent, in
each case in form and substance reasonably satisfactory to the Administrative
Agent, a notice of the existence and nature of such Commercial Tort Claim and
deliver a supplement to Schedule 11.1 containing a specific description of
such Commercial Tort Claim, (ii) the provision of Section 11.1 shall apply to
such Commercial Tort Claim and (iii) such Loan Party shall execute and deliver
to the Administrative Agent, in each case in form and substance reasonably
satisfactory to the Administrative Agent, any certificate, agreement and other
document, and take all other action, deemed by the Administrative Agent to be
reasonably necessary or appropriate for the Administrative Agent to obtain, on
behalf of the Secured Parties, a first-priority, perfected security interest
in all such Commercial Tort Claims. Any supplement to Schedule 11.1 delivered
pursuant to this Section 11.5(i) shall, after the receipt thereof by the
Administrative Agent, become part of Schedule 11.1 for all purposes hereunder
other than in respect of representations and warranties made prior to the date
of such receipt.
Section 11.5. Performance by Agent of the Loan Parties' Obligations.
If any Loan Party fails to perform or comply with any of its agreements
contained in this Article XI and the Administrative Agent, as provided for by
the terms of this Agreement, shall itself perform or comply, or otherwise
cause performance or compliance, with such agreement, the expenses of the
Administrative Agent incurred in connection with such performance or
compliance, together with interest thereon at the rate then in effect in
respect of the Revolving Loan, shall be payable by such Loan Party to the
Administrative Agent on demand and shall constitute Obligations secured by the
Collateral. Performance of such Loan Party's obligations as permitted under
this Section 11.5 shall in no way constitute a violation of the automatic stay
provided by section 362 of the Bankruptcy Code and each Loan Party hereby
waives applicability thereof. Moreover, the Administrative Agent shall in no
way be responsible for the payment of any costs incurred in connection with
preserving or disposing of Collateral pursuant to section 506(c) of the
Bankruptcy Code and the Collateral may not be charged for the incurrence of
any such cost.
Section 11.6. Limitation on Agent's Duty in Respect of Collateral.
Neither the Administrative Agent nor any Lender shall have any duty as to any
Collateral in its possession or control or in the possession or control of any
agent or nominee of it or any income thereon or as to the preservation of
rights against prior parties or any other rights pertaining thereto, except
that the Administrative Agent shall, with respect to the Collateral in its
possession or under its control, deal with such Collateral in the same manner
as the Administrative Agent deals with similar property for its own account.
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Upon request of the Borrower, the Administrative Agent shall account for any
moneys received by it in respect of any foreclosure on or disposition of the
Collateral of any Loan Party.
Section 11.7. Remedies, Rights Upon Default.
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(a) If any Event of Default shall occur and be continuing, and
subject only to any required notice provided in the Orders, the Administrative
Agent may exercise in addition to all other rights and remedies granted to it
in this Agreement and in any other Loan Document, all rights and remedies of a
secured party under the UCC. Without limiting the generality of the foregoing,
each Loan Party expressly agrees that in any such event the Administrative
Agent, without demand of performance or other demand, advertisement or notice
of any kind (except the notice required by the Interim Order or Final Order or
the notice specified below of time and place of public or private sale) to or
upon such Loan Party or any other Person (all and each of which demands,
advertisements and/or notices (except the notice required by the Interim Order
or Final Order or the notice specified below of time and place of public or
private sale) are hereby expressly waived to the maximum extent permitted by
the UCC and other applicable law), may forthwith collect, receive, appropriate
and realize upon the Collateral, or any part thereof, and/or may forthwith
sell, lease, assign, give an option or options to purchase, or sell or
otherwise dispose of and deliver said Collateral (or contract to do so), or
any part thereof, in one or more parcels at public or private sale or sales,
at any exchange or broker's board or at any of the Administrative Agent's
offices or elsewhere at such prices as it may deem best, for cash or on credit
or for future delivery without assumption of any credit risk. The
Administrative Agent shall have the right upon any such public sale or sales
to purchase the whole or any part of said Collateral so sold, free of any
right or equity of redemption, which equity of redemption each Loan Party
hereby releases. Each Loan Party further agrees, at the Administrative Agent's
request, to assemble the Collateral make it available to the Administrative
Agent at places which the Administrative Agent shall reasonably select,
whether at such Loan Party's premises or elsewhere. The Administrative Agent
shall apply the proceeds of any such collection, recovery, receipt,
appropriation, realization or sale (net of all expenses incurred by the
Administrative Agent in connection therewith, including, without limitation,
attorney's fees and expenses), to the Obligations in any order deemed
appropriate by the Administrative Agent, such Loan Party remaining liable for
any deficiency remaining unpaid after such application, and only after so
paying over such net proceeds and after the payment by the Administrative
Agent of any other amount required by any provision of law, including Section
9-504(l)(c) of the UCC, shall the Administrative Agent account for and pay
over the surplus, if any, to such Loan Party. To the maximum extent permitted
by applicable law, each Loan Party waives all claims, damages, and demands
against the Administrative Agent and the Lenders arising out of the
repossession, retention or sale of the Collateral except such as arise out of
the gross negligence or willful misconduct of the Administrative Agent. Each
Loan Party agrees that the Administrative Agent need not give more than five
days' notice to the Borrower (which notification shall be deemed given when
mailed or delivered on an overnight basis, postage prepaid, addressed to the
Borrower at its address referred to in Section 13.8) of the time and place of
any public sale or of the time after which a private sale may take place and
that such notice is reasonable notification of such matters. The Loan Parties
shall remain liable for any deficiency if the proceeds of any sale or
disposition of the Collateral are insufficient to pay all amounts to which the
Administrative Agent is entitled, the Loan Parties also being liable for the
fees and expenses of any attorneys employed by the Administrative Agent to
collect such deficiency.
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(b) Each Loan Party hereby waives presentment, demand, protest or any
notice (to the maximum extent permitted by applicable law) of any kind in
connection with this Agreement or any Collateral.
(c) Pledged Collateral.
(i) During the continuance of an Event of Default, if the
Administrative Agent shall give notice of its intent to exercise such
rights to the relevant Loan Party or Loan Parties, (i) the
Administrative Agent shall have the right to receive any and all cash
dividends, payments or other Proceeds paid in respect of the Pledged
Collateral and make application thereof to the Obligations in the
order set forth herein, and (ii) the Administrative Agent or its
nominee may exercise (A) all voting, consent, corporate and other
rights pertaining to the Pledged Collateral at any meeting of
shareholders, partners or members, as the case may be, of the
relevant issuer or issuers of Pledged Collateral or otherwise and (B)
any and all rights of conversion, exchange and subscription and any
other rights, privileges or options pertaining to the Pledged
Collateral as if it were the absolute owner thereof (including the
right to exchange at its discretion any and all of the Pledged
Collateral upon the merger, consolidation, reorganization,
recapitalization or other fundamental change in the corporate
structure of any issuer of Pledged Securities, the right to deposit
and deliver any and all of the Pledged Collateral with any committee,
depositary, transfer agent, registrar or other designated agency upon
such terms and conditions as the Administrative Agent may determine),
all without liability except to account for property actually
received by it, but the Administrative Agent shall have no duty to
any Loan Party to exercise any such right, privilege or option and
shall not be responsible for any failure to do so or delay in so
doing.
(ii) In order to permit the Administrative Agent to exercise the
voting and other consensual rights which it may be entitled to
exercise pursuant hereto and to receive all dividends and other
distributions which it may be entitled to receive hereunder, (i) each
Loan Party shall promptly execute and deliver (or cause to be
executed and delivered) to the Administrative Agent all such proxies,
dividend payment orders and other instruments as the Administrative
Agent may from time to time reasonably request and (ii) without
limiting the effect of clause (i) above, such Loan Party hereby
grants to the Administrative Agent an irrevocable proxy to vote all
or any part of the Pledged Collateral and to exercise all other
rights, powers, privileges and remedies to which a holder of the
Pledged Collateral would be entitled (including giving or withholding
written consents of shareholders, partners or members, as the case
may be, calling special meetings of shareholders, partners or
members, as the case may be, and voting at such meetings), which
proxy shall be effective, automatically and without the necessity of
any action (including any transfer of any Pledged Collateral on the
record books of the issuer thereof) by any other person (including
the issuer of such Pledged Collateral or any officer or agent
thereof) during the continuance of an Event of Default and which
proxy shall only terminate upon the payment in full of the Secured
Obligations.
(iii) Each Loan Party hereby expressly authorizes and instructs
each issuer of any Pledged Collateral pledged hereunder by such Loan
Party to (i) comply with any instruction received by it from the
Administrative Agent in writing that (A) states that an Event of
Default has occurred and is continuing and (B) is otherwise in
accordance with the terms of this Agreement, without any other or
further instructions from such Loan Party, and each Loan Party agrees
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that such issuer shall be fully protected in so complying and (ii)
unless otherwise expressly permitted hereby, pay any dividends or
other payments with respect to the Pledged Collateral directly to the
Administrative Agent.
Section 11.8. The Administrative Agent's Appointment as
Attorney-in-Fact.
-----------------------------------------
(a) Each Loan Party hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its and its Subsidiaries true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of such Loan
Party and in the name of such Loan Party, or in its own name, from time to
time in the Administrative Agent's discretion, for the purpose of carrying out
the terms of this Agreement, to take any and all appropriate action and to
execute and deliver any and all documents and instruments which may be
necessary and desirable to accomplish the purposes of this Agreement and the
transactions contemplated hereby, and, without limiting the generality of the
foregoing, hereby give the Administrative Agent the power and right, on behalf
of such Loan Party, without notice to or assent by such Loan Party to do the
following:
(i) to ask, demand, collect, receive and give acquittances and
receipts for any and all moneys due and to become due under any
Collateral and, in the name of such Loan Party, its own name or
otherwise, to take possession of and endorse and collect any checks,
drafts, notes, acceptances or other Instruments for the payment of
moneys due under any Collateral and to file any claim or to take any
other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of
collecting any and all such moneys due under any Collateral whenever
payable and to file any claim or to take any other action or
proceeding in any court of law or equity or otherwise deemed
appropriate by the Administrative Agent for the purpose of collecting
any and all such moneys due under any Collateral whenever payable;
(ii) to pay or discharge taxes, liens, security interests or
other encumbrances levied or placed on or threatened against the
Collateral, to effect any repairs or any insurance called for by the
terms of this Agreement and to pay all or any part of the premiums
therefor and the costs thereof; and
(iii) (A) to direct any party liable for any payment under any
of the Collateral to make payment of any and all moneys due, and to
become due thereunder, directly to the Administrative Agent or as the
Administrative Agent shall direct; (B) to receive payment of and
receipt for any and all moneys, claims and other amounts due, and to
become due at any time, in respect of or arising out of any
Collateral; (C) to sign and indorse any invoices, freight or express
bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications and notices in connection with
accounts and other documents constituting or relating to the
Collateral; (D) to commence and prosecute any suits, actions or
proceedings at law or equity in any court of competent jurisdiction
to collect the Collateral or any part thereof and to enforce any
other right in respect of any Collateral; (E) to defend any suit,
action or proceeding brought against any Loan Party with respect to
any Collateral of such Loan Party; (F) to settle, compromise or
adjust any suit, action or proceeding described above and, in
connection therewith, to give such discharges or releases as the
Administrative Agent may deem appropriate; (G) to license or, to the
extent permitted by an applicable license, sublicense, whether
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general, special or otherwise, and whether on an exclusive or
non-exclusive basis, any trademarks, throughout the world for such
term or terms, on such conditions, and in such manner, as the
Administrative Agent shall in its sole discretion determine; and (H)
generally to sell, transfer, pledge, make any agreement with respect
to or otherwise deal with any of the Collateral as fully and
completely as though the Administrative Agent were the absolute owner
thereof for all purposes, and to do, at the Administrative Agent's
option and such Loan Party's expense, at any time, or from time to
time, all acts and things which the Administrative Agent reasonably
deems necessary to protect, preserve or realize upon the Collateral
and the Administrative Agent's Lien therein, in order to effect the
intent of this Agreement, all as fully and effectively as such Loan
Party might do.
(b) The Administrative Agent agrees that it will forbear from
exercising the power of attorney or any rights granted to the Administrative
Agent pursuant to this Section 11.8, except upon the occurrence and during the
continuation of an Event of Default. The Loan Parties hereby ratify, to the
extent permitted by law, all that said attorneys shall lawfully do or cause to
be done by virtue hereof. Exercise by the Administrative Agent of the powers
granted hereunder is not a violation of the automatic stay provided by section
362 of the Bankruptcy Code and each Loan Party waives applicability thereof.
The power of attorney granted pursuant to this Section 11.8 is a power coupled
with an interest and shall be irrevocable until the Obligations are
indefeasibly paid in full.
(c) The powers conferred on the Administrative Agent hereunder are
solely to protect the Administrative Agent's and the Lenders' interests in the
Collateral and shall not impose any duty upon it to exercise any such powers.
The Administrative Agent shall be accountable only for amounts that it
actually receives as a result of the exercise of such powers and neither it
nor any of its officers, directors, employees or agents shall be responsible
to any Loan Party for any act or failure to act, except for its own gross
negligence or willful misconduct.
(d) Each Loan Party also authorizes the Administrative Agent, at any
time and from time to time upon the occurrence and during the continuation of
any Event of Default or as otherwise expressly permitted by this Agreement,
(i) to communicate in its own name or the name of its Subsidiaries with any
party to any Contract with regard to the assignment of the right, title and
interest of such Loan Party in and under the Contracts hereunder and other
matters relating thereto and (ii) to execute any endorsements, assignments or
other instruments of conveyance or transfer with respect to the Collateral.
(e) All Secured Obligations shall constitute, in accordance with
section 364(c)(1) of the Bankruptcy Code, claims against each Loan Party in
its Case which are administrative expense claims having priority over any all
administrative expenses of the kind specified in sections 503(b) or 507(b) of
the Bankruptcy Code.
Section 11.9. Modifications.
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(a) The Liens, lien priority, administrative priorities and other
rights and remedies granted to the Administrative Agent for the benefit of the
Lenders pursuant to this Agreement, the Interim Order and/or the Final Order
(specifically, including, but not limited to, the existence, perfection and
priority of the Liens provided herein and therein and the administrative
priority provided herein and therein) shall not be modified, altered or
impaired in any manner by any other financing or extension of credit or
incurrence of Indebtedness by any of the Loan Parties (pursuant to section 364
of the Bankruptcy Code or otherwise), or by any dismissal or conversion of any
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of the Cases, or by any other act or omission whatsoever. Without limitation,
notwithstanding any such order, financing, extension, incurrence, dismissal,
conversion, act or omission:
(i) except for the Carve-Out having priority over the
Obligations, no costs or expenses of administration which have been
or may be incurred in any of the Cases or any conversion of the same
or in any other proceedings related thereto, and no priority claims,
are or will be prior to or on a parity with any claim of the
Administrative Agent or the Lenders against the Loan Parties in
respect of any Secured Obligation;
(ii) the liens and security interests granted herein shall
constitute valid and perfected first priority liens and security
interests (subject only to (i) valid, perfected, nonavoidable and
enforceable Liens existing as of the Petition Date, other than the
Liens on the Collateral securing Prepetition Secured Indebtedness,
(ii) the Carve-Out, (iii) Liens permitted under Section 8.2(d) and
(iv) post-petition Liens permitted under Section 8.2(c), (e) and (i))
in accordance with sections 364(c)(2) and (3) and 364(d)(1) of the
Bankruptcy Code, and shall be prior to all other liens and security
interests, now existing or hereafter arising, in favor of any other
creditor or any other Person whatsoever; and
(iii) the liens and security interests granted hereunder shall
continue valid and perfected without the necessity that financing
statements be filed or that any other action be taken under
applicable nonbankruptcy law.
(b) Notwithstanding any failure on the part of any Loan Party or the
Administrative Agent or the Lenders to perfect, maintain, protect or enforce
the liens and security interests in the Collateral granted hereunder, the
Interim Order and the Final Order (when entered) shall automatically, and
without further action by any Person, perfect such liens and security
interests against the Collateral.
ARTICLE XII
THE ADMINISTRATIVE AGENT; THE ARRANGER
Section 12.1. Authorization and Action.
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(a) Each Lender and each Issuer hereby appoints Citicorp as the
Administrative Agent hereunder and each Lender and each Issuer authorizes the
Administrative Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
delegated to the Administrative Agent under such agreements and to exercise
such powers as are reasonably incidental thereto. Without limiting the
foregoing, each Lender and each Issuer hereby authorizes the Administrative
Agent to execute and deliver, and to perform its obligations under, each of
the Loan Documents to which the Administrative Agent is a party, to exercise
all rights, powers and remedies that the Administrative Agent may have under
such Loan Documents and in the case of the Collateral Documents, to act as
agent for the Lenders, Issuers and the other Secured Parties under such
Collateral Documents.
(b) As to any matters not expressly provided for by this Agreement
and the other Loan Documents (including enforcement or collection), the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall
be fully protected in so acting or refraining from acting) upon the
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instructions of the Requisite Lenders, and such instructions shall be binding
upon all Lenders and each Issuer; provided, however, that the Administrative
Agent shall not be required to take any action that (i) the Administrative
Agent in good faith believes exposes it to personal liability unless the
Administrative Agent receives an indemnification satisfactory to it from the
Lenders and the Issuers with respect to such action or (ii) is contrary to
this Agreement or applicable law. The Administrative Agent agrees to give to
each Lender and each Issuer prompt notice of each notice given to it by any
Loan Party pursuant to the terms of this Agreement or the other Loan
Documents.
(c) In performing its functions and duties hereunder and under the
other Loan Documents, the Administrative Agent is acting solely on behalf of
the Lenders and the Issuers and its duties are entirely administrative in
nature. The Administrative Agent does not assume and shall not be deemed to
have assumed any obligation other than as expressly set forth herein and in
the other Loan Documents or any other relationship as the agent, fiduciary or
trustee of or for any Lender, Issuer or holder of any other Obligation. The
Administrative Agent may perform any of its duties under any Loan Document by
or through its agents or employees.
(d) The Arranger shall have no obligations or duties whatsoever in
such capacity under this Agreement or any other Loan Document and shall incur
no liability hereunder or thereunder in such capacity.
Section 12.2. Agent's Reliance, Etc. None of the Administrative
Agent, any of its Affiliates or any of their respective directors, officers,
agents or employees shall be liable for any action taken or omitted to be
taken by it, him, her or them under or in connection with this Agreement or
the other Loan Documents, except for its, his, her or their own gross
negligence or willful misconduct. Without limiting the foregoing, the
Administrative Agent (a) may treat the payee of any Revolving Credit Note as
its holder until such Revolving Credit Note has been assigned in accordance
with Section 13.2, (b) may rely on the Register to the extent set forth in
Section 13.2(c), (c) may consult with legal counsel (including counsel to the
Borrower or any other Loan Party), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts, (d) makes no warranty or representation to any Lender
or Issuer and shall not be responsible to any Lender or Issuer for any
statements, warranties or representations made by or on behalf of the Borrower
or any of its Subsidiaries in or in connection with this Agreement or any
other Loan Document, (e) shall not have any duty to ascertain or to inquire
either as to the performance or observance of any term, covenant or condition
of this Agreement or any other Loan Document, as to the financial condition of
any Loan Party, or as to the existence or possible existence of any Default or
Event of Default, (f) shall not be responsible to any Lender or Issuer for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of, or the attachment, perfection or priority of any Lien created or
purported to be created under or in connection with, this Agreement, any other
Loan Document or any other instrument or document furnished pursuant hereto or
thereto and (g) shall incur no liability under or in respect of this Agreement
or any other Loan Document by acting upon any notice, consent, certificate or
other instrument or writing (which writing may be a telecopy or electronic
mail) or any telephone message believed by it to be genuine and signed or sent
by the proper party or parties.
Section 12.3. Posting of Approved Electronic Communications.
---------------------------------------------
(a) Each of the Lenders, the Issuers, the Borrower and the Subsidiary
Guarantors agree that the Administrative Agent may, but shall not be obligated
to, make the Approved Electronic Communications available to the Lenders and
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Issuers by posting such Approved Electronic Communications on IntraLinks(TM)
or a substantially similar electronic platform chosen by the Administrative
Agent to be its electronic transmission system (the "Approved Electronic
Platform").
(b) Although the Approved Electronic Platform and its primary web
portal are secured with generally-applicable security procedures and policies
implemented or modified by the Administrative Agent from time to time
(including, as of the Closing Date, a dual firewall and a User ID/Password
Authorization System) and the Approved Electronic Platform is secured through
a single-user-per-deal authorization method whereby each user may access the
Approved Electronic Platform only on a deal-by-deal basis, each of the
Lenders, the Issuers, the Borrower and the Subsidiary Guarantors acknowledges
and agrees that the distribution of material through an electronic medium is
not necessarily secure and that there are confidentiality and other risks
associated with such distribution. In consideration for the convenience and
other benefits afforded by such distribution and for the other consideration
provided hereunder, the receipt and sufficiency of which is hereby
acknowledged, each of the Lenders, the Issuers, the Borrower and the
Subsidiary Guarantors hereby approves distribution of the Approved Electronic
Communications through the Approved Electronic Platform and understands and
assumes the risks of such distribution.
(c) THE APPROVED ELECTRONIC COMMUNICATIONS AND THE APPROVED
ELECTRONIC PLATFORM ARE PROVIDED "AS IS" AND "AS AVAILABLE". NONE OF THE
ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES (THE
"AGENT AFFILIATES") WARRANT THE ACCURACY, ADEQUACY OR COMPLETENESS OF THE
APPROVED ELECTRONIC COMMUNICATIONS AND THE APPROVED ELECTRONIC PLATFORM AND
EACH EXPRESSLY DISCLAIMS LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED
ELECTRONIC COMMUNICATIONS AND THE APPROVED ELECTRONIC PLATFORM. NO WARRANTY OF
ANY KIND, EXPRESS, IMPLIED OR STATUTORY (INCLUDING, WITHOUT LIMITATION, ANY
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE
DEFECTS) IS MADE BY THE AGENT AFFILIATES IN CONNECTION WITH THE APPROVED
ELECTRONIC COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM.
(d) Each of the Lenders, the Issuers, the Borrower and the Subsidiary
Guarantors agree that the Administrative Agent may, but (except as may be
required by applicable law) shall not be obligated to, store the Approved
Electronic Communications on the Approved Electronic Platform in accordance
with the Administrative Agent's generally-applicable document retention
procedures and policies.
Section 12.4. The Administrative Agent Individually. With respect to
its Ratable Portion, Citicorp shall have and may exercise the same rights and
powers hereunder and is subject to the same obligations and liabilities as and
to the extent set forth herein for any other Lender. The terms "Lenders",
"Revolving Credit Lenders", "Requisite Lenders" and any similar terms shall,
unless the context clearly otherwise indicates, include, without limitation,
the Administrative Agent in its individual capacity as a Lender, a Revolving
Credit Lender or as one of the Requisite Lenders. Citicorp and its Affiliates
may accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Loan Party as if Citicorp were not
acting as the Administrative Agent.
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Section 12.5. Lender Credit Decision. Each Lender and each Issuer
acknowledges that it shall, independently and without reliance upon the
Administrative Agent or any other Lender conduct its own independent
investigation of the financial condition and affairs of the Borrower and each
other Loan Party in connection with the making and continuance of the Loans
and with the issuance of the Letters of Credit. Each Lender and each Issuer
also acknowledges that it shall, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and other
Loan Documents.
Section 12.6. Indemnification. Each Revolving Credit Lender agrees to
indemnify the Administrative Agent and each of its Affiliates, and each of
their respective directors, officers, employees, agents and advisors (to the
extent not reimbursed by the Borrower), from and against such Revolving Credit
Lender's aggregate Ratable Portion of any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements (including fees, expenses and disbursements of financial and
legal advisors) of any kind or nature whatsoever that may be imposed on,
incurred by, or asserted against, the Administrative Agent or any of its
Affiliates, directors, officers, employees, agents and advisors in any way
relating to or arising out of this Agreement or the other Loan Documents or
any action taken or omitted by the Administrative Agent under this Agreement
or the other Loan Documents; provided, however, that no Revolving Credit
Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Administrative Agent's or such Affiliate's
gross negligence or willful misconduct. Without limiting the foregoing, each
Revolving Credit Lender agrees to reimburse the Administrative Agent promptly
upon demand for its ratable share of any out-of-pocket expenses (including
fees, expenses and disbursements of financial and legal advisors) incurred by
the Administrative Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of its rights or responsibilities under, this Agreement or the other
Loan Documents, to the extent that the Administrative Agent is not reimbursed
for such expenses by the Borrower or another Loan Party.
Section 12.7. Successor Agent. The Administrative Agent may resign at
any time by giving written notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Requisite Lenders shall have the right to
appoint a successor Administrative Agent. If no successor Administrative Agent
shall have been so appointed by the Requisite Lenders, and shall have accepted
such appointment, within 30 days after the retiring Administrative Agent's
giving of notice of resignation, then the retiring Administrative Agent may,
on behalf of the Lenders, appoint a successor Administrative Agent, selected
from among the Lenders. In either case, such appointment shall be subject to
the prior written approval of the Borrower (which approval may not be
unreasonably withheld and shall not be required upon the occurrence and during
the continuance of an Event of Default). Upon the acceptance of any
appointment as Administrative Agent by a successor Administrative Agent, such
successor Administrative Agent shall succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent,
and the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement and the other Loan Documents. Prior to any
retiring Administrative Agent's resignation hereunder as Administrative Agent,
the retiring Administrative Agent shall take such action as may be reasonably
necessary to assign to the successor Administrative Agent its rights as
Administrative Agent under the Loan Documents. After such resignation, the
retiring Administrative Agent shall continue to have the benefit of this
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Article XII as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement and the other Loan Documents.
Section 12.8. Concerning the Collateral and the Collateral Documents.
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(a) Each Lender and each Issuer agrees that any action taken by the
Administrative Agent or the Requisite Lenders (or, where required by the
express terms of this Agreement, a greater proportion of the Lenders) in
accordance with the provisions of this Agreement or of the other Loan
Documents, and the exercise by the Administrative Agent or the Requisite
Lenders (or, where so required, such greater proportion) of the powers set
forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of the Lenders,
Issuers and other Secured Parties. Without limiting the generality of the
foregoing, the Administrative Agent shall have the sole and exclusive right
and authority to (i) act as the disbursing and collecting agent for the
Lenders and the Issuers with respect to all payments and collections arising
in connection herewith and with the Collateral Documents, (ii) execute and
deliver each Collateral Document and accept delivery of each such agreement
delivered by the Borrower or any of its Subsidiaries, (iii) act as collateral
agent for the Lenders, the Issuers and the other Secured Parties for purposes
of the perfection of all security interests and Liens created by such
agreements and all other purposes stated therein, provided, however, that the
Administrative Agent hereby appoints, authorizes and directs each Lender and
Issuer to act as collateral sub-agent for the Administrative Agent, the
Lenders and the Issuers for purposes of the perfection of all security
interests and Liens with respect to the Collateral, including any Deposit
Accounts maintained by a Loan Party with, and cash and Cash Equivalents held
by, such Lender or such Issuer, (iv) manage, supervise and otherwise deal with
the Collateral, including the making of Protective Advances in an aggregate
amount not to exceed the lesser of $5,000,000 and the aggregate amount of the
unused Revolving Credit Commitments, (v) take such action as is necessary or
desirable to maintain the perfection and priority of the security interests
and Liens created or purported to be created by the Collateral Documents and
(vi) except as may be otherwise specifically restricted by the terms hereof or
of any other Loan Document, exercise all remedies given to the Administrative
Agent, the Lenders, the Issuers and the other Secured Parties with respect to
the Collateral under the Loan Documents relating thereto, the Orders,
applicable law or otherwise.
(b) Each of the Lenders and the Issuers hereby consents to the
release and hereby directs, in accordance with the terms hereof, the
Administrative Agent to release (or, in the case of clause (ii) below, release
or subordinate) any Lien held by the Administrative Agent for the benefit of
the Lenders and the Issuers against any of the following:
(i) all of the Collateral and all Loan Parties, upon
termination of the Revolving Credit Commitments and payment and
satisfaction in full of all Loans, all Reimbursement Obligations and
all other Obligations that the Administrative Agent has been notified
in writing are then due and payable (and, in respect of contingent
Letter of Credit Obligations, with respect to which cash collateral
has been deposited or a back-up letter of credit has been issued, in
either case in the appropriate currency and on terms satisfactory to
the Administrative Agent and the applicable Issuers);
(ii) any assets that are subject to a Lien permitted by Section
8.2(d) or (e) (Liens, Etc.); and
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(iii) any part of the Collateral sold or disposed of by a Loan
Party if such sale or disposition is permitted by this Agreement (or
permitted pursuant to a waiver or consent to a transaction otherwise
prohibited by this Agreement).
Each of the Lenders and the Issuers hereby directs the Administrative
Agent to execute and deliver or file such termination and partial release
statements and do such other things as are necessary to release Liens to be
released pursuant to this Section 12.8 promptly upon the effectiveness of any
such release.
Section 12.9. Collateral Matters Relating to Related Obligations.
--------------------------------------------------
The benefit of the Loan Documents and of the provisions of this
Agreement relating to the Collateral shall extend to and be available in
respect of any Secured Obligation arising under any Hedging Contract or Cash
Management Obligation or that is otherwise owed to Persons other than the
Administrative Agent, the Lenders and the Issuers (collectively, "Related
Obligations") solely on the condition and understanding, as among the
Administrative Agent and all Secured Parties, that (a) the Related Obligations
shall be entitled to the benefit of the Loan Documents and the Collateral to
the extent expressly set forth in this Agreement and the other Loan Documents
and to such extent the Administrative Agent shall hold, and have the right and
power to act with respect to, the Guaranty and the Collateral on behalf of and
as agent for the holders of the Related Obligations, but the Administrative
Agent is otherwise acting solely as agent for the Lenders and the Issuers and
shall have no fiduciary duty, duty of loyalty, duty of care, duty of
disclosure or other obligation whatsoever to any holder of Related
Obligations, (b) all matters, acts and omissions relating in any manner to the
Guaranty, the Collateral, or the omission, creation, perfection, priority,
abandonment or release of any Lien, shall be governed solely by the provisions
of this Agreement and the other Loan Documents and no separate Lien, right,
power or remedy shall arise or exist in favor of any Secured Party under any
separate instrument or agreement or in respect of any Related Obligation, (c)
each Secured Party shall be bound by all actions taken or omitted, in
accordance with the provisions of this Agreement and the other Loan Documents,
by the Administrative Agent and the Requisite Lenders, each of whom shall be
entitled to act at its sole discretion and exclusively in its own interest
given its own Revolving Credit Commitments and its own interest in the Loans,
Letter of Credit Obligations and other Obligations to it arising under this
Agreement or the other Loan Documents, without any duty or liability to any
other Secured Party or as to any Related Obligation and without regard to
whether any Related Obligation remains outstanding or is deprived of the
benefit of the Collateral or becomes unsecured or is otherwise affected or put
in jeopardy thereby, (d) no holder of Related Obligations and no other Secured
Party (except the Administrative Agent, the Lenders and the Issuers, to the
extent set forth in this Agreement) shall have any right to be notified of, or
to direct, require or be heard with respect to, any action taken or omitted in
respect of the Collateral or under this Agreement or the Loan Documents and
(e) no holder of any Related Obligation shall exercise any right of setoff,
banker's lien or similar right except to the extent provided in Section 13.6
(Right of Set-off) and then only to the extent such right is exercised in
compliance with Section 13.7 (Sharing of Payments, Etc.).
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ARTICLE XIII
MISCELLANEOUS
Section 13.1. Amendments, Waivers, Etc.
-------------------------
(a) No amendment or waiver of any provision of this Agreement or any
other Loan Document nor consent to any departure by any Loan Party therefrom
shall in any event be effective unless the same shall be in writing and signed
by the Requisite Lenders (or by the Administrative Agent with the consent of
the Requisite Lenders) and, in the case of any amendment, by the Borrower, and
then any such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
no amendment, waiver or consent shall, unless in writing and signed by each
Lender directly affected thereby, in addition to the Requisite Lenders (or the
Administrative Agent with the consent thereof), do any of the following:
(i) waive any condition specified in Section 3.1, 3.2 or 3.3
except with respect to a condition based upon another provision
hereof, the waiver of which requires only the concurrence of the
Requisite Lenders and, in the case of the conditions specified in
Section 3.1 or 3.2, subject to the provisions of Section 3.3;
(ii) increase the Revolving Credit Commitment of such Lender or
subject such Lender to any additional obligation;
(iii) extend the scheduled final maturity of any Loan owing to
such Lender, or waive, reduce or postpone any scheduled date fixed
for the payment or reduction of principal or interest of any such
Loan or fees owing to such Lender (it being understood that Section
2.9 does not provide for scheduled dates fixed for payment) or for
the reduction of such Lender's Revolving Credit Commitment;
(iv) reduce, or release the Borrower from its obligations to
repay, the principal amount of any Loan or Reimbursement Obligation
owing to such Lender (other than by the payment or prepayment
thereof);
(v) reduce the rate of interest on any Loan or Reimbursement
Obligations outstanding and owing to such Lender or any fee payable
hereunder to such Lender;
(vi) expressly subordinate any of the Secured Obligations or any
Liens securing the Secured Obligations;
(vii) postpone any scheduled date fixed for payment of such
interest or fees owing to such Lender or waive any such payment;
(viii) change the aggregate Ratable Portions of Lenders required
for any or all Lenders to take any action hereunder;
(ix) release all or substantially all of the Collateral except
as provided in Section 12.8(b) or release the Borrower from its
payment obligation to such Lender under this Agreement or the
Revolving Credit Notes owing to such Lender (if any) or release any
Subsidiary Guarantor from its obligations under the Guaranty except
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in connection with the sale or other disposition of a Subsidiary
Guarantor (or all or substantially all of the assets thereof)
permitted by this Agreement (or permitted pursuant to a waiver or
consent of a transaction otherwise prohibited by this Agreement);
(x) increase any of the percentages set forth in the definition
of "Borrowing Base" above the maximum percentages stated in such
definition on the date hereof; or
(xi) amend Section 12.8(b), Section 13.7, this Section 13.1 or
either definition of the terms "Requisite Lenders" or "Ratable
Portion";
and provided, further, that (x) no amendment, waiver or consent shall, unless
in writing and signed by any Special Purpose Vehicle that has been granted an
option pursuant to Section 13.2(f) (Assignments and Participations), affect
the grant or nature of such option or the right or duties of such Special
Purpose Vehicle hereunder, (y) no amendment, waiver or consent shall, unless
in writing and signed by the Administrative Agent in addition to the Lenders
required above to take such action, affect the rights or duties of the
Administrative Agent under this Agreement or the other Loan Documents and (z)
no amendment, waiver or consent shall, unless in writing and signed by the
Swing Loan Lender in addition to the Lenders required above to take such
action, affect the rights or duties of the Swing Loan Lender under this
Agreement or the other Loan Documents;
and provided, further, that the Administrative Agent may, with the consent of
the Borrower, amend, modify or supplement this Agreement to cure any
typographical error, defect or inconsistency, so long as such amendment,
modification or supplement does not adversely affect the right of any Lender
or any Issuer.
(b) The Administrative Agent may, but shall have no obligation to,
with the written concurrence of any Lender, execute amendments, modifications,
waivers or consents on behalf of such Lender. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on the Borrower in any case shall entitle
the Borrower to any other or further notice or demand in similar or other
circumstances.
(c) If, in connection with any proposed amendment, modification,
waiver or termination (a "Proposed Change") requiring the consent of all
affected Lenders, the consent of Requisite Lenders is obtained but the consent
of other Revolving Credit Lenders whose consent is required is not obtained
(any such Revolving Credit Lender whose consent is not obtained as described
in this Section 13.1 being referred to as a "Non-Consenting Lender"), then, as
long as the Revolving Credit Lender acting as the Administrative Agent is not
a Non-Consenting Lender, at the Borrower's request, any Eligible Assignee
acceptable to the Administrative Agent shall have the right with the
Administrative Agent's consent and in the Administrative Agent's sole
discretion (but shall have no obligation) to purchase from such Non-Consenting
Lender, and such Non-Consenting Lender agrees that it shall, upon the
Administrative Agent's request, sell and assign to the Revolving Credit Lender
acting as the Administrative Agent or such Eligible Assignee, all of the
Revolving Credit Commitments, and Revolving Credit Outstandings of such
Non-Consenting Lender for an amount equal to the principal balance of all
Loans held by the Non-Consenting Lender and all accrued and unpaid interest
and fees with respect thereto through the date of sale; provided, however,
that such purchase and sale shall not be effective until (x) the
Administrative Agent shall have received from such Eligible Assignee an
agreement in form and substance satisfactory to the Administrative Agent and
the Borrower whereby such Eligible Assignee shall agree to be bound by the
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terms hereof and (y) such Non-Consenting Lender shall have received payments
of all Loans held by it and all accrued and unpaid interest and fees with
respect thereto through the date of the sale. Each Revolving Credit Lender
agrees that, if it becomes a Non-Consenting Lender, it shall execute and
deliver to the Administrative Agent an Assignment an Acceptance to evidence
such sale and purchase and shall deliver to the Administrative Agent any
Revolving Credit Note (if the assigning Revolving Credit Lender's Loans are
evidenced by a Revolving Credit Note) subject to such Assignment and
Acceptance; provided, however, that the failure of any Non-Consenting Lender
to execute an Assignment and Acceptance shall not render such sale and
purchase (and the corresponding assignment) invalid.
Section 13.2. Assignments and Participations.
------------------------------
(a) Each Revolving Credit Lender may sell, transfer, negotiate or
assign to one or more Eligible Assignees all or a portion of its rights and
obligations hereunder (including all of its rights and obligations with
respect to the Revolving Loans, the Swing Loans and the Letters of Credit);
provided, however, that (i) if any such assignment shall be of the assigning
Revolving Credit Lender's Revolving Credit Outstandings and Revolving Credit
Commitments, such assignment shall cover the same percentage of such Revolving
Credit Lender's Revolving Credit Outstandings and Revolving Credit
Commitments, (ii) the aggregate amount being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event (if less than the assignor's
entire interest) be less than $2,500,000 or an integral multiple of $1,000,000
in excess thereof, except, in either case, (A) with the consent of the
Borrower and the Administrative Agent or (B) if such assignment is being made
to a Lender or an Affiliate or Approved Fund of such Lender and (iii) if such
Eligible Assignee is not, prior to the date of such assignment, a Lender or an
Affiliate or Approved Fund of a Lender, such assignment shall be subject to
the prior consent of the Administrative Agent and the Borrower (which consents
shall not be unreasonably withheld or delayed); and provided, further, that,
notwithstanding any other provision of this Section 13.2, the consent of the
Borrower shall not be required (x) for any assignment occurring when any Event
of Default shall have occurred and be continuing and (y) except as set forth
in the Commitment Letter, dated January 25, 2005, from the Arranger and
Citicorp to the Borrower, for any assignment by any Affiliate of the
Administrative Agent made within 15 Business Days after the Closing Date of
its Revolving Credit Commitment held on the Closing Date.
(b) The parties to each such assignment shall execute and deliver to
the Administrative Agent, for its acceptance and recording, an Assignment and
Acceptance, together with any Revolving Credit Note (if the assigning
Revolving Credit Lender's Loans are evidenced by a Revolving Credit Note)
subject to such assignment. Upon the execution, delivery, acceptance and
recording of any Assignment and Acceptance and, other than in respect of
assignments made pursuant to Section 2.17 (Substitution of Lenders) and
Section 13.1(c) (Amendments, Waivers, Etc.), the receipt by the Administrative
Agent from the assignee of an assignment fee in the amount of $3,500 from and
after the effective date specified in such Assignment and Acceptance, (i) the
assignee thereunder shall become a party hereto and, to the extent that rights
and obligations under the Loan Documents have been assigned to such assignee
pursuant to such Assignment and Acceptance, have the rights and obligations of
a Revolving Credit Lender and, if such Revolving Credit Lender were an Issuer,
of such Issuer hereunder and thereunder, (ii) the Revolving Credit Notes (if
any) corresponding to the Loans assigned thereby shall be transferred to such
assignee by notification in the Register and (iii) the assignor thereunder
shall, to the extent that rights and obligations under this Agreement have
been assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights (except for those surviving the payment in full of the Obligations) and
be released from its obligations under the Loan Documents, other than those
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relating to events or circumstances occurring prior to such assignment (and,
in the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Revolving Credit Lender's rights and obligations under
the Loan Documents, such Revolving Credit Lender shall cease to be a party
hereto).
(c) The Administrative Agent shall maintain at its address referred
to in Section 13.8 a copy of each Assignment and Acceptance delivered to and
accepted by it and a register for the recording of the names and addresses of
the Lenders and the Revolving Credit Commitments of and principal amount of
the Loans and Letter of Credit Obligations owing to each Lender from time to
time (the "Register"). Any assignment pursuant to this Section 13.2 shall not
be effective until such assignment is recorded in the Register. The entries in
the Register shall be conclusive and binding for all purposes, absent manifest
error, and the Loan Parties, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower, the Administrative Agent or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(d) Notwithstanding anything to the contrary contained in clause (b)
above, the Loans (including the Revolving Credit Notes evidencing such Loans)
are registered obligations and the right, title, and interest of the Lenders
and their assignees in and to such Loans shall be transferable only upon
notation of such transfer in the Register. A Revolving Credit Note shall only
evidence the Lender's or an assignee's right, title and interest in and to the
related Loan, and in no event is any such Revolving Credit Note to be
considered a bearer instrument or obligation. This Section 13.2 shall be
construed so that the Loans are at all times maintained in "registered form"
within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Internal
Revenue Code and any related regulations (or any successor provisions of the
Internal Revenue Code or such regulations). Solely for purposes of this and
for tax purposes only, the Administrative Agent shall act as the Borrower's
agent for purposes of maintaining such notations of transfer in the Register.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Revolving Credit Lender, an assignee and, if required, the Borrower,
the Administrative Agent shall, if such Assignment and Acceptance has been
completed, (i) accept such Assignment and Acceptance, (ii) record or cause to
be recorded the information contained therein in the Register and (iii) give
prompt notice thereof to the Borrower. Within five Business Days after its
receipt of such notice, the Borrower, at its own expense, shall, if requested
by such assignee, execute and deliver to the Administrative Agent, new
Revolving Credit Notes to the order of such assignee in an amount equal to the
Revolving Credit Commitments assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Revolving Credit Lender has surrendered any
Revolving Credit Note for exchange in connection with the assignment and has
retained Revolving Credit Commitments hereunder, new Revolving Credit Notes to
the order of the assigning Revolving Credit Lender in an amount equal to the
Revolving Credit Commitments retained by it hereunder. Such new Revolving
Credit Notes shall be dated the same date as the surrendered Revolving Credit
Notes and be in substantially the form of Exhibit B (Form of Revolving Credit
Note).
(f) In addition to the other assignment rights provided in this
Section 13.2, each Revolving Credit Lender may do each of the following:
(i) grant to a Special Purpose Vehicle the option to make all
or any part of any Loan that such Revolving Credit Lender would
otherwise be required to make hereunder and the exercise of such
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option by any such Special Purpose Vehicle and the making of Loans
pursuant thereto shall satisfy (once and to the extent that such
Loans are made) the obligation of such Revolving Credit Lender to
make such Loans thereunder, provided, however, that (x) nothing
herein shall constitute a commitment or an offer to commit by such a
Special Purpose Vehicle to make Loans hereunder and no such Special
Purpose Vehicle shall be liable for any indemnity or other Obligation
(other than the making of Loans for which such Special Purpose
Vehicle shall have exercised an option, and then only in accordance
with the relevant option agreement) and (y) such Lender's obligations
under the Loan Documents shall remain unchanged, such Lender shall
remain responsible to the other parties for the performance of its
obligations under the terms of this Agreement and shall remain the
holder of the Obligations for all purposes hereunder; and
(ii) assign, as collateral or otherwise, any of its rights under
this Agreement, whether now owned or hereafter acquired (including
rights to payments of principal or interest on the Loans), to (A)
without notice to or consent of the Administrative Agent or the
Borrower, any Federal Reserve Bank (pursuant to Regulation A of the
Federal Reserve Board) and (B) without consent of the Administrative
Agent or the Borrower, (1) any holder of, or trustee for the benefit
of, the holders of such Revolving Credit Lender's Securities and (2)
any Special Purpose Vehicle to which such Revolving Credit Lender has
granted an option pursuant to clause (i) above;
provided, however, that no such assignment or grant shall release such
Revolving Credit Lender from any of its obligations hereunder except as
expressly provided in clause (i) above and except, in the case of a subsequent
foreclosure pursuant to an assignment as collateral, if such foreclosure is
made in compliance with the other provisions of this Section 13.2 other than
this clause (f) or clause (g) below. Each party hereto acknowledges and agrees
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other senior debt of any such Special
Purpose Vehicle, such party shall not institute against, or join any other
Person in instituting against, any Special Purpose Vehicle that has been
granted an option pursuant to this clause (f) any bankruptcy, reorganization,
insolvency or liquidation proceeding (such agreement shall survive the payment
in full of the Obligations). The terms of the designation of, or assignment
to, such Special Purpose Vehicle shall not restrict such Lender's ability to,
or grant such Special Purpose Vehicle the right to, consent to any amendment
or waiver to this Agreement or any other Loan Document or to the departure by
the Borrower from any provision of this Agreement or any other Loan Document
without the consent of such Special Purpose Vehicle except, as long as the
Administrative Agent and the Lenders, Issuers and other Secured Parties shall
continue to, and shall be entitled to continue to, deal solely and directly
with such Lender in connection with such Lender's obligations under this
Agreement, to the extent any such consent would reduce the principal amount
of, or the rate of interest on, any Obligations, amend this clause (f) or
postpone any scheduled date of payment of such principal or interest. Each
Special Purpose Vehicle shall be entitled to the benefits of Sections 2.15
(Capital Adequacy) and 2.16 (Taxes) and of Section 2.14(d) (Illegality) as if
it were such Lender; provided, however, that anything herein to the contrary
notwithstanding, no Borrower shall, at any time, be obligated to make under
Section 2.15 (Capital Adequacy), 2.16 (Taxes) or 2.14(d) (Illegality) to any
such Special Purpose Vehicle and any such Lender any payment in excess of the
amount the Borrower would have been obligated to pay to such Lender in respect
of such interest if such Special Purpose Vehicle had not been assigned the
rights of such Lender hereunder.
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(g) Each Lender may sell participations to one or more Persons in or
to all or a portion of its rights and obligations under the Loan Documents
(including all its rights and obligations with respect to the Revolving Loans
and Letters of Credit). The terms of such participation shall not, in any
event, require the participant's consent to any amendments, waivers or other
modifications of any provision of any Loan Documents, the consent to any
departure by any Loan Party therefrom, or to the exercising or refraining from
exercising any powers or rights such Lender may have under or in respect of
the Loan Documents (including the right to enforce the obligations of the Loan
Parties), except if any such amendment, waiver or other modification or
consent would (i) reduce the amount, or postpone any date fixed for, any
amount (whether of principal, interest or fees) payable to such participant
under the Loan Documents, to which such participant would otherwise be
entitled under such participation or (ii) result in the release of all or
substantially all of the Collateral other than in accordance with Section
12.8(b). In the event of the sale of any participation by any Lender, (A) such
Lender's obligations under the Loan Documents shall remain unchanged, (B) such
Lender shall remain solely responsible to the other parties for the
performance of such obligations, (C) such Lender shall remain the holder of
such Obligations for all purposes of this Agreement, and (D) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Each participant shall be entitled to the
benefits of Sections 2.14(d), 2.15 and 2.16 as if it were a Lender; provided,
however, that anything herein to the contrary notwithstanding, the Borrower
shall not, at any time, be obligated to make under Section 2.14(d), 2.15 or
2.16 to the participants in the rights and obligations of any Lender (together
with such Lender) any payment in excess of the amount the Borrower would have
been obligated to pay to such Lender in respect of such interest had such
participation not been sold.
(h) Any Issuer may at any time assign its rights and obligations
hereunder to any other Lender by an instrument in form and substance
satisfactory to the Borrower, the Administrative Agent, such Issuer and such
Lender. If any Issuer ceases to be a Lender hereunder by virtue of any
assignment made pursuant to this Section 11.2, then, as of the effective date
of such cessation, such Issuer's obligations to Issue Letters of Credit
pursuant to Section 2.4 shall terminate and such Issuer shall be an Issuer
hereunder only with respect to outstanding Letters of Credit issued prior to
such date.
Section 13.3. Costs and Expenses.
------------------
(a) The Borrower agrees upon demand to pay, or reimburse the
Administrative Agent for, all of the Administrative Agent's reasonable
internal per diem audit, appraisal and valuation costs and expenses, and all
of the Administrative Agent's reasonable out-of-pocket audit, legal,
appraisal, valuation, filing, document duplication and reproduction and
investigation expenses and for all other reasonable out-of-pocket costs and
expenses of every type and nature (including the reasonable fees, expenses and
disbursements of the Administrative Agent's counsel, Weil, Gotshal & Xxxxxx
LLP, local legal counsel, auditors, accountants, appraisers, printers,
insurance and environmental advisors, and other consultants and agents)
incurred by the Administrative Agent in connection with any of the following:
(i) the Administrative Agent's audit and investigation of the Borrower and its
Subsidiaries in connection with the preparation, negotiation or execution of
any Loan Document or the Administrative Agent's periodic audits of the
Borrower or any of its Subsidiaries, as the case may be, (ii) the preparation,
negotiation, execution or interpretation of this Agreement (including, without
limitation, the satisfaction or attempted satisfaction of any condition set
forth in Article III (Conditions To Loans And Letters Of Credit)), any Loan
Document or any proposal letter or commitment letter issued in connection
therewith, or the making of the Loans hereunder, (iii) the creation,
perfection or protection of the Liens under any Loan Document (including any
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reasonable fees, disbursements and expenses for local counsel in various
jurisdictions), (iv) the ongoing administration of this Agreement and the
Loans, including consultation with attorneys in connection therewith and with
respect to the Administrative Agent's rights and responsibilities hereunder
and under the other Loan Documents, (v) the protection, collection or
enforcement of any Obligation or the enforcement of any Loan Document, (vi)
the commencement, defense or intervention in any court proceeding relating in
any way to the Obligations, any Loan Party, any of the Borrower's
Subsidiaries, this Agreement or any other Loan Document, (vii) the response
to, and preparation for, any subpoena or request for document production with
which the Administrative Agent is served or deposition or other proceeding in
which the Administrative Agent is called to testify, in each case, relating in
any way to the Obligations, any Loan Party, any of the Borrower's
Subsidiaries, this Agreement or any other Loan Document or (viii) any
amendment, consent, waiver, assignment, restatement, or supplement to any Loan
Document or the preparation, negotiation and execution of the same.
(b) The Borrower further agrees to pay or reimburse the
Administrative Agent and each of the Lenders and Issuers upon demand for all
out-of-pocket costs and expenses, including reasonable attorneys' fees
(including allocated costs of internal counsel and costs of settlement),
incurred by the Administrative Agent, such Lenders or such Issuers in
connection with any of the following: (i) in enforcing any Loan Document or
Obligation or any security therefor or exercising or enforcing any other right
or remedy available by reason of an Event of Default, (ii) in connection with
any refinancing or restructuring of the credit arrangements provided hereunder
in the nature of a "work-out" or in any insolvency or bankruptcy proceeding,
(iii) in commencing, defending or intervening in any litigation or in filing a
petition, complaint, answer, motion or other pleadings in any legal proceeding
relating to the Obligations, any Loan Party, any of the Borrower's
Subsidiaries and related to or arising out of the transactions contemplated
hereby or by any other Loan Document or (iv) in taking any other action in or
with respect to any suit or proceeding (bankruptcy or otherwise) described in
clause (i), (ii) or (iii) above.
Section 13.4. Indemnities.
-----------
(a) The Borrower agrees to indemnify and hold harmless the
Administrative Agent, the Arranger, each Lender and each Issuer (including
each Person obligated on a Hedging Contract that is a Loan Document if such
Person was a Lender or Issuer at the time of it entered into such Hedging
Contract) and each of their respective Affiliates, and each of the directors,
officers, employees, agents, trustees, representatives, attorneys, consultants
and advisors of or to any of the foregoing (including those retained in
connection with the satisfaction or attempted satisfaction of any condition
set forth in Article III (Conditions To Loans And Letters Of Credit)) (each
such Person being an "Indemnitee") from and against any and all claims,
damages, liabilities, obligations, losses, penalties, actions, judgments,
suits, costs, disbursements and reasonable out-of-pocket expenses, joint or
several, of any kind or nature (including reasonable fees, disbursements and
expenses of financial and legal advisors to any such Indemnitee) that may be
imposed on, incurred by or asserted against any such Indemnitee in connection
with or arising out of any investigation, litigation or proceeding, whether or
not such investigation, litigation or proceeding is brought by any such
Indemnitee or any of its directors, security holders or creditors or any such
Indemnitee, director, security holder or creditor is a party thereto, whether
direct, indirect, or consequential and whether based on any federal, state or
local law or other statutory regulation, securities or commercial law or
regulation, or under common law or in equity, or on contract, tort or
otherwise, in any manner relating to or arising out of this Agreement, any
other Loan Document, any Obligation, any Letter of Credit, any Disclosure
Document, or any act, event or transaction related or attendant to any
thereof, or the use or intended use of the proceeds of the Loans or Letters of
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Credit or in connection with any investigation of any potential matter covered
hereby (collectively, the "Indemnified Matters"); provided, however, that the
Borrower shall not have any liability under this Section 13.4 to an Indemnitee
with respect to any Indemnified Matter that has resulted primarily from the
gross negligence or willful misconduct of that Indemnitee, as determined by a
court of competent jurisdiction in a final non-appealable judgment or order.
Without limiting the foregoing, "Indemnified Matters" include (i) all
Environmental Liabilities and Costs arising from or connected with the past,
present or future operations of the Borrower or any of its Subsidiaries
involving any property subject to this Agreement, the Orders or a Collateral
Document, or damage to real or personal property or natural resources or harm
or injury alleged to have resulted from any Release of Contaminants on, upon
or into such property or any contiguous real estate, (ii) any costs or
liabilities incurred in connection with any Remedial Action concerning the
Borrower or any of its Subsidiaries, (iii) any costs or liabilities incurred
in connection with any Environmental Lien and (iv) any costs or liabilities
incurred in connection with any other matter under any Environmental Law,
including the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (49 U.S.C. ss. 9601 et seq.) and applicable state property
transfer laws, whether, with respect to any such matter, such Indemnitee is a
mortgagee pursuant to any leasehold mortgage, a mortgagee in possession, the
successor in interest to the Borrower or any of its Subsidiaries, or the
owner, lessee or operator of any property of the Borrower or any of its
Subsidiaries by virtue of foreclosure, except, with respect to those matters
referred to in clauses (i), (ii), (iii) and (iv) above, to the extent (x)
incurred following foreclosure by the Administrative Agent, any Lender or any
Issuer, or the Administrative Agent, any Lender or any Issuer having become
the successor in interest to the Borrower or any of its Subsidiaries and (y)
attributable solely to acts of the Administrative Agent, such Lender or such
Issuer or any agent on behalf of the Administrative Agent, such Lender or such
Issuer.
(b) The Borrower shall indemnify the Administrative Agent, the
Lenders and each Issuer for, and hold the Administrative Agent, the Lenders
and each Issuer harmless from and against, any and all claims for brokerage
commissions, fees and other compensation made against the Administrative
Agent, the Lenders and the Issuers for any broker, finder or consultant with
respect to any agreement, arrangement or understanding made by or on behalf of
any Loan Party or any of its Subsidiaries in connection with the transactions
contemplated by this Agreement.
(c) The Borrower, at the request of any Indemnitee, shall have the
obligation to defend against any investigation, litigation or proceeding or
requested Remedial Action, in each case contemplated in clause (a) above, and
the Borrower, in any event, may participate in the defense thereof with legal
counsel of the Borrower's choice. In the event that such Indemnitee requests
the Borrower to defend against such investigation, litigation or proceeding or
requested Remedial Action, the Borrower shall promptly do so and such
Indemnitee shall have the right to have legal counsel of its choice
participate in such defense. No action taken by legal counsel chosen by such
Indemnitee in defending against any such investigation, litigation or
proceeding or requested Remedial Action, shall vitiate or in any way impair
the Borrower's obligation and duty hereunder to indemnify and hold harmless
such Indemnitee.
(d) The Borrower agrees that any indemnification or other protection
provided to any Indemnitee pursuant to this Agreement (including pursuant to
this Section 13.4) or any other Loan Document shall (i) survive payment in
full of the Obligations and (ii) inure to the benefit of any Person that was
at any time an Indemnitee under this Agreement or any other Loan Document.
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Section 13.5. Limitation of Liability.
-----------------------
(a) The Borrower agrees that no Indemnitee shall have any liability
(whether in contract, tort or otherwise) to any Loan Party or any of their
respective Subsidiaries or any of their respective equity holders or creditors
for or in connection with the transactions contemplated hereby and in the
other Loan Documents and Related Documents, except to the extent such
liability is determined in a final non-appealable judgment by a court of
competent jurisdiction to have resulted primarily from such Indemnitee's gross
negligence or willful misconduct. In no event, however, shall any Indemnitee
be liable on any theory of liability for any special, indirect, consequential
or punitive damages (including, without limitation, any loss of profits,
business or anticipated savings). Each of the Borrower and the Subsidiary
Guarantors hereby waives, releases and agrees (each for itself and on behalf
of its Subsidiaries) not to xxx upon any such claim for any special, indirect,
consequential or punitive damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
(b) IN NO EVENT SHALL ANY AGENT AFFILIATE HAVE ANY LIABILITY TO ANY
LOAN PARTY, LENDER, ISSUER OR ANY OTHER PERSON FOR DAMAGES OF ANY KIND,
INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
LOSSES OR EXPENSES (WHETHER IN TORT OR CONTRACT OR OTHERWISE) ARISING OUT OF
ANY LOAN PARTY OR ANY AGENT AFFILIATE'S TRANSMISSION OF APPROVED ELECTRONIC
COMMUNICATIONS THROUGH THE INTERNET OR ANY USE OF THE APPROVED ELECTRONIC
PLATFORM, EXCEPT TO THE EXTENT SUCH LIABILITY OF ANY AGENT AFFILIATE IS FOUND
IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO
HAVE RESULTED PRIMARILY FORM SUCH AGENT AFFILIATE'S GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT.
Section 13.6. Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, subject to any requirement of notice
provided in the Orders, each Lender and each Affiliate of a Lender is hereby
authorized at any time and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other Indebtedness at any
time owing by such Lender or its Affiliates to or for the credit or the
account of each Loan Party against any and all of the Secured Obligations now
or hereafter existing whether or not such Lender shall have made any demand
under this Agreement or any other Loan Document and even though such Secured
Obligations may be unmatured. Each Lender agrees promptly to notify the
applicable Loan Party after any such set-off and application made by such
Lender or its Affiliates; provided, however, that the failure to give such
notice shall not affect the validity of such set-off and application. The
rights of each Lender under this Section 13.6 are in addition to the other
rights and remedies (including other rights of set-off) that such Lender may
have.
Section 13.7. Sharing of Payments, Etc.
-------------------------
(a) If any Revolving Credit Lender (directly or through an Affiliate
thereof) obtains any payment (whether voluntary, involuntary, through the
exercise of any right of set-off (including pursuant to Section 13.6 (Right of
Set-off) or otherwise) of the Loans owing to it, any interest thereon, fees in
respect thereof or amounts due pursuant to Section 13.3 (Costs and Expenses)
or 13.4 (Indemnities) (other than payments pursuant to Sections 2.14 (Special
Provisions Governing Eurodollar Rate Loans), 2.15 (Capital Adequacy) or 2.16
121
(Taxes)) or otherwise receives any Collateral or any Proceeds of Collateral
(other than payments pursuant to Sections 2.14 (Special Provisions Governing
Eurodollar Rate Loans), 2.15 (Capital Adequacy) or 2.16 (Taxes)) (in each
case, whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise (including pursuant to Section 13.6 (Right of Set-off))
in excess of its Ratable Portion of all payments of such Obligations obtained
by all the Revolving Credit Lenders, such Revolving Credit Lender (a
"Purchasing Lender") shall forthwith purchase from the other Lenders (each, a
"Selling Lender") such participations in their Loans or other Obligations as
shall be necessary to cause such Purchasing Lender to share the excess payment
ratably with each of them.
(b) If all or any portion of any payment received by a Purchasing
Lender is thereafter recovered from such Purchasing Lender, such purchase from
each Selling Lender shall be rescinded and such Selling Lender shall repay to
the Purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Selling Lender's ratable share
(according to the proportion of (i) the amount of such Selling Lender's
required repayment in relation to (ii) the total amount so recovered from the
Purchasing Lender) of any interest or other amount paid or payable by the
Purchasing Lender in respect of the total amount so recovered.
(c) The Borrower agrees that any Purchasing Lender so purchasing a
participation from a Selling Lender pursuant to this Section 13.7 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of the Borrower in the amount of such
participation.
Section 13.8. Notices, Etc.
-------------
(a) All notices, demands, requests, consents and other communications
provided for in this Agreement shall be given in writing, or by any
telecommunication device capable of creating a written record (including
electronic mail), and addressed to the party to be notified as follows:
(i) if to the Borrower:
Xxxxxxxx'x Inc.
000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxx, Chief Financial Officer
Xxxxxx Xxxxx, General Counsel
Telecopy No.: 000 000 0000
Electronic Mail Address: xxxxxx@xxxxxxxxx.xxx
xxxxxx@xxxxxxxxx.xxx
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
Electronic Mail Address: Xxxxxxxx@xxxxxxx.xxx
122
(ii) if to any Revolving Credit Lender, at its Domestic Lending
Office specified opposite its name on Schedule II or on the signature
page of any applicable Assignment and Acceptance;
(iii) if to any Issuer, at the address set forth opposite its
name on Schedule II; and
(iv) if to the Administrative Agent or the Swing Loan Lender:
Citicorp USA, Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
Telecopy No.: (000) 000-0000
Electronic Mail Address: xxxxxx.xxxxxx@xxxxxxxxx.xxx
with a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx Xxxx
Telecopy No.: (000) 000-0000
Electronic Mail Address: xxxxxx.xxxx@xxxx.xxx
or at such other address as shall be notified in writing (x) in the case of
the Borrower, the Administrative Agent and the Swing Loan Lender, to the other
parties and (y) in the case of all other parties, to the Borrower and the
Administrative Agent.
(b) Effectiveness of Notices. All notices, demands, requests,
consents and other communications described in clause (a) above shall be
effective (i) if delivered by hand, including any overnight courier service,
upon personal delivery, (ii) if delivered by mail, when deposited in the
mails, (iii) if delivered by posting to an Approved Electronic Platform, an
Internet website or a similar telecommunication device requiring that a user
have prior access to such Approved Electronic Platform, website or other
device, when such notice, demand, request, consent and other communication
shall have been made generally available on such Approved Electronic Platform,
Internet website or similar device to the class of Person being notified
(regardless of whether any such Person must accomplish, and whether or not any
such Person shall have accomplished, any action prior to obtaining access to
such items, including registration, disclosure of contact information,
compliance with a standard user agreement or undertaking a duty of
confidentiality) and (iv) if delivered by electronic mail or any other
telecommunications device, when transmitted to an electronic mail address (or
by another means of electronic delivery) as provided in clause (a) above;
provided, however, that notices and communications to the Administrative Agent
pursuant to Article II (The Facility) or XII (The Administrative Agent) shall
not be effective until received by the Administrative Agent.
(c) Use of Electronic Platform. Notwithstanding clauses (a) and (b)
above (unless the Administrative Agent requests that the provisions of clause
(a) and (b) above be followed) and any other provision in this Agreement or
any other Loan Document providing for the delivery of, any Approved Electronic
Communication by any other means, the Loan Parties shall deliver all Approved
Electronic Communications to the Administrative Agent by properly transmitting
123
such Approved Electronic Communications electronically (in a format acceptable
to the Administrative Agent) to xxxxxxxxxxxxxxx@xxxxxxxxx.xxx or such other
electronic mail address (or similar means of electronic delivery) as the
Administrative Agent may notify the Borrower. Nothing in this clause (c) shall
prejudice the right of the Administrative Agent or any Lender or Issuer to
deliver any Approved Electronic Communication to any Loan Party in any manner
authorized in this Agreement.
Section 13.9. No Waiver; Remedies. No failure on the part of any
Lender, Issuer or the Administrative Agent to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 13.10. Binding Effect. This Agreement shall become effective
when it shall have been executed by the Borrower, each Subsidiary Guarantor
and the Administrative Agent and when the Administrative Agent shall have been
notified by each Lender and Issuer that such Lender or Issuer has executed it
and thereafter shall be binding upon and inure to the benefit of the Borrower,
each Subsidiary Guarantor, the Administrative Agent and each Lender and Issuer
and, in each case, their respective successors and assigns; provided, however,
that the Borrower and each Subsidiary Guarantor shall not have the right to
assign their rights hereunder or any interest herein without the prior written
consent of the Lenders.
Section 13.11. Governing Law. This Agreement and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York and, to the
extent applicable, the Bankruptcy Code.
Section 13.12. Submission to Jurisdiction; Service of Process.
----------------------------------------------
(a) Any legal action or proceeding with respect to this Agreement or
any other Loan Document may be brought in the courts of the State of New York
located in the City of New York or of the United States of America for the
Southern District of New York, and, by execution and delivery of this
Agreement, the Borrower and each Subsidiary Guarantor hereby accepts for
itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. The parties hereto hereby irrevocably
waive any objection, including any objection to the laying of venue or based
on the grounds of forum non conveniens, that any of them may now or hereafter
have to the bringing of any such action or proceeding in such respective
jurisdictions.
(b) The Borrower and each Subsidiary Guarantor hereby irrevocably
consents to the service of any and all legal process, summons, notices and
documents in any suit, action or proceeding brought in the United States of
America arising out of or in connection with this Agreement or any other Loan
Document by the mailing (by registered or certified mail, postage prepaid) or
delivering of a copy of such process to the Borrower or the Subsidiary
Guarantor, as the case may be, at its address specified in Section 13.8. The
Borrower and each Subsidiary Guarantor 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.
(c) Nothing contained in this Section 13.12 shall affect the right of
the Administrative Agent or any Lender to serve process in any other manner
124
permitted by law or commence legal proceedings or otherwise proceed against
the Borrower or any other Loan Party in any other jurisdiction.
(d) If for the purposes of obtaining judgment in any court it is
necessary to convert a sum due hereunder in Dollars into another currency, the
parties hereto agree, to the fullest extent that they may effectively do so,
that the rate of exchange used shall be that at which in accordance with
normal banking procedures the Administrative Agent could purchase Dollars with
such other currency at the spot rate of exchange quoted by the Administrative
Agent at 11:00 a.m. (New York time) on the Business Day preceding that on
which final judgment is given, for the purchase of Dollars, for delivery two
Business Days thereafter.
Section 13.13. Waiver of Jury Trial. EACH OF THE ADMINISTRATIVE
AGENT, THE LENDERS, THE ISSUERS, THE BORROWER AND THE SUBSIDIARY GUARANTORS
IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.
Section 13.14. Marshaling; Payments Set Aside. None of the
Administrative Agent, any Lender or any Issuer shall be under any obligation
to marshal any assets in favor of the Borrower, any Subsidiary Guarantor or
any other party or against or in payment of any or all of the Obligations. To
the extent that the Borrower makes a payment or payments to the Administrative
Agent, the Lenders or the Issuers or any such Person receives payment from the
proceeds of the Collateral or exercise their rights of setoff, and such
payment or payments or the proceeds of such enforcement or setoff or any part
thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, receiver or any
other party, then to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied, and all Liens, right and remedies
therefor, shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
Section 13.15. Section Titles. The section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto,
except when used to reference a section. Any reference to the number of a
clause, sub-clause or subsection hereof immediately followed by a reference in
parenthesis to the title of the Section containing such clause, sub-clause or
subsection is a reference to such clause, sub-clause or subsection and not to
the entire Section; provided, however, that, in case of direct conflict
between the reference to the title and the reference to the number of such
Section, the reference to the title shall govern absent manifest error. If any
reference to the number of a Section (but not to any clause, sub-clause or
subsection thereof) is followed immediately by a reference in parenthesis to
the title of a Section, the title reference shall govern in case of direct
conflict absent manifest error.
Section 13.16. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are attached to
the same document. Delivery of an executed signature page of this Agreement by
facsimile transmission or by posting on the Approved Electronic Platform shall
be as effective as delivery of a manually executed counterpart hereof. A set
of the copies of this Agreement signed by all parties shall be lodged with the
Borrower and the Administrative Agent.
125
Section 13.17. Entire Agreement. This Agreement, together with all of
the other Loan Documents and all certificates and documents delivered
hereunder or thereunder, embodies the entire agreement of the parties and
supersedes all prior agreements and understandings relating to the subject
matter hereof. In the event of any conflict between the terms of this
Agreement and any other Loan Document, the terms of this Agreement shall
govern.
Section 13.18. Confidentiality. Each Lender and the Administrative
Agent agree to use all reasonable efforts to keep information obtained by it
pursuant hereto and the other Loan Documents confidential in accordance with
such Lender's or the Administrative Agent's, as the case may be, customary
practices and agrees that it shall only use such information in connection
with the transactions contemplated by this Agreement and not disclose any such
information other than (a) to such Lender's or the Administrative Agent's, as
the case may be, employees, representatives and agents that are or are
expected to be involved in the evaluation of such information in connection
with the transactions contemplated by this Agreement and are advised of the
confidential nature of such information, (b) to the extent such information
presently is or hereafter becomes available to such Lender or the
Administrative Agent, as the case may be, on a non-confidential basis from a
source other than the Borrower or any other Loan Party, (c) to the extent
disclosure is required by law, regulation or judicial order or requested or
required by bank regulators or auditors or (d) to current or prospective
assignees, participants and Special Purpose Vehicle grantees of any option
described in Section 13.2(f) (Assignments and Participations), contractual
counterparties in any Hedging Contract permitted hereunder and to their
respective legal or financial advisors, in each case and to the extent such
assignees, participants, grantees or counterparties agree to be bound by, and
to cause their advisors to comply with, the provisions of this Section 13.18.
Notwithstanding any other provision in this Agreement, the Borrower and the
Administrative Agent hereby agree that each of the Borrower, the Subsidiary
Guarantors, the Lenders, the Administrative Agent and the Arranger (and each
of their respective employees, representatives and agents and each of the
officers, directors, employees, accountants, attorneys and other advisors of
any of them) may disclose to any and all persons, without limitation of any
kind, the U.S. tax treatment and U.S. tax structure of the Facility and the
transactions contemplated hereby and all materials of any kind (including
opinions and other tax analyses) that are provided to each of them relating to
such U.S. tax treatment and U.S. tax structure.
[SIGNATURE PAGES FOLLOW]
126
[SIGNATURE PAGE TO CREDIT AGREEMENT]
[SIGNATURE PAGE TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
XXXXXXXX'X INC.,
as Borrower
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: Chief Executive Officer
FI STORES LIMITED PARTNERSHIP,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: Chief Executive Officer
XXXXXXXX'X MANAGEMENT CORP.,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: President
XXXXXXXX'X FLORIDA PARTNERSHIP,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: President
XXXXXXXX'X HOLDING CORP.,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: President
FCJV HOLDING CORP.,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: President
XXXXXXXX'X INVESTMENTS LLC,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: Chief Executive Officer
XXXXXXXX'X BENEFICIARY INC.,
as a Subsidiary Guarantor
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
Title: President
[SIGNATURE PAGE TO CREDIT AGREEMENT]
CITICORP USA, INC.,
as Administrative Agent, Lender
and Swing Loan Lender
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
CITIBANK, N.A.,
as Issuer
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
[SIGNATURE PAGE TO CREDIT AGREEMENT]
TABLE OF CONTENTS
Page
Article I Definitions, Interpretation And Accounting Terms...............1
Section 1.1. Defined Terms.......................................1
Section 1.2. Computation of Time Periods........................33
Section 1.3. Accounting Terms and Principles....................33
Section 1.4. Certain Terms......................................34
Article II The Facility..................................................34
Section 2.1. The Revolving Credit Commitments...................34
Section 2.2. Borrowing Procedures...............................35
Section 2.3. Swing Loans........................................36
Section 2.4. Letters of Credit..................................38
Section 2.5. Reduction and Termination of the Revolving
Credit Commitments...............................42
Section 2.6. Repayment of Loans.................................43
Section 2.7. Evidence of Debt...................................43
Section 2.8. Optional Prepayments...............................43
Section 2.9. Mandatory Prepayments..............................43
Section 2.10. Interest...........................................45
Section 2.11. Conversion/Continuation Option.....................46
Section 2.12. Fees...............................................46
Section 2.13. Payments and Computations..........................47
Section 2.14. Special Provisions Governing Eurodollar Rate
Loans............................................50
Section 2.15. Capital Adequacy...................................51
Section 2.16. Taxes..............................................52
Section 2.17. Substitution of Lenders............................53
Section 2.18. Change of Lending Office...........................54
Article III Conditions To Loans And Letters Of Credit.....................55
Section 3.1. Conditions Precedent to Initial Loans and Letters
of Credit........................................55
Section 3.2. Conditions Precedent to the Incremental Facility
Effective Date...................................56
Section 3.3. Conditions Precedent to Each Loan and Letter of
Credit...........................................58
i
TABLE OF CONTENTS
(continued)
Page
Section 3.4. Determinations of Initial Borrowing Conditions.....59
Article IV Representations and Warranties................................60
Section 4.1. Corporate Existence; Compliance with Law...........60
Section 4.2. Corporate Power; Authorization; Enforceable
Obligations......................................60
Section 4.3. Ownership of Borrower; Subsidiaries................61
Section 4.4. Financial Statements...............................61
Section 4.5. Material Adverse Change............................62
Section 4.6. Litigation.........................................62
Section 4.7. Taxes..............................................63
Section 4.8. Full Disclosure....................................63
Section 4.9. Margin Regulations.................................63
Section 4.10. No Burdensome Restrictions; No Defaults............64
Section 4.11. Investment Company Act; Public Utility Holding
Company Act......................................64
Section 4.12. Use of Proceeds....................................64
Section 4.13. Insurance..........................................65
Section 4.14. Labor Matters......................................65
Section 4.15. ERISA..............................................65
Section 4.16. Environmental Matters..............................66
Section 4.17. Intellectual Property..............................66
Section 4.18. Title; Real Property...............................67
Section 4.19. Secured, Super Priority Obligations................67
Section 4.20. Deposit Accounts; Control Accounts.................68
Section 4.21. Title; No Other Liens..............................68
Section 4.22. Pledged Collateral.................................68
Section 4.23. Intellectual Property..............................69
Article V Financial Covenants...........................................70
Section 5.1. Minimum EBITDAR....................................70
Section 5.2. Capital Expenditures...............................70
ii
TABLE OF CONTENTS
(continued)
Page
Article VI Reporting Covenants...........................................70
Section 6.1. Financial Statements...............................70
Section 6.2. Default Notices....................................73
Section 6.3. Litigation.........................................73
Section 6.4. Asset Sales........................................73
Section 6.5. SEC Filings; Press Releases........................73
Section 6.6. Labor Relations....................................73
Section 6.7. Tax Returns........................................73
Section 6.8. Insurance..........................................73
Section 6.9. ERISA Matters......................................74
Section 6.10. Environmental Matters..............................74
Section 6.11. Borrowing Base Determination.......................75
Section 6.12. Customer Contracts.................................76
Section 6.13. Tax Reporting......................................76
Section 6.14. Bankruptcy Court...................................76
Section 6.15. Other Information..................................76
Article VII Affirmative Covenants.........................................76
Section 7.1. Preservation of Corporate Existence, Etc...........76
Section 7.2. Compliance with Laws, Etc..........................76
Section 7.3. Conduct of Business................................77
Section 7.4. Payment of Taxes, Etc..............................77
Section 7.5. Maintenance of Insurance...........................77
Section 7.6. Access.............................................77
Section 7.7. Keeping of Books...................................77
Section 7.8. Maintenance of Properties, Etc.....................77
Section 7.9. Application of Proceeds............................78
Section 7.10. Environmental......................................78
Section 7.11. Additional Collateral and Guaranties...............78
Section 7.12. Control Accounts; Approved Deposit Accounts........79
Section 7.13. Cash Flow Variances................................81
iii
TABLE OF CONTENTS
(continued)
Page
Section 7.14. Landlord Waivers and Bailee's Letters..............81
Article VIII Negative Covenants............................................81
Section 8.1. Indebtedness.......................................81
Section 8.2. Liens, Etc.........................................82
Section 8.3. Investments........................................83
Section 8.4. Sale of Assets.....................................84
Section 8.5. Restricted Payments................................85
Section 8.6. Restriction on Fundamental Changes.................85
Section 8.7. Change in Nature of Business.......................85
Section 8.8. Transactions with Affiliates.......................85
Section 8.9. Restrictions on Subsidiary Distributions; No New
Negative Pledge..................................86
Section 8.10. Restrictions on Modification of Certain Documents
and Optional Prepayments.........................86
Section 8.11. Accounting Changes; Fiscal Year....................87
Section 8.12. Margin Regulations.................................87
Section 8.13. Sale/Leasebacks....................................87
Section 8.14. No Speculative Transactions........................87
Section 8.15. Compliance with ERISA..............................87
Section 8.16. Environmental......................................87
Section 8.17. Chapter 11 Claims..................................87
Section 8.18. The Orders.........................................87
Article IX Events Of Default.............................................88
Section 9.1. Events of Default..................................88
Section 9.2. Remedies...........................................90
Section 9.3. Actions in Respect of Letters of Credit............91
Section 9.4. Rescission.........................................91
Article X Guaranty......................................................91
Section 10.1. The Guaranty.......................................91
Section 10.2. Nature of Liability................................92
iv
TABLE OF CONTENTS
(continued)
Page
Section 10.3. Independent Obligation.............................92
Section 10.4. Authorization......................................92
Section 10.5. Reliance...........................................93
Section 10.6. Subordination......................................93
Section 10.7. Waiver.............................................93
Section 10.8. Limitation on Enforcement..........................94
Article XI Security......................................................94
Section 11.1. Security...........................................94
Section 11.2. Perfection of Security Interests...................96
Section 11.3. Rights of Lender; Limitations on Lenders'
Obligations......................................97
Section 11.4. Covenants of the Loan Parties with Respect to
Collateral.......................................98
Section 11.5. Performance by Agent of the Loan Parties'
Obligations.....................................102
Section 11.6. Limitation on Agent's Duty in Respect of
Collateral......................................102
Section 11.7. Remedies, Rights Upon Default.....................103
Section 11.8. The Administrative Agent's Appointment as
Attorney-in-Fact................................105
Section 11.9. Modifications.....................................106
Article XII The Administrative Agent; The Arranger.......................107
Section 12.1. Authorization and Action..........................107
Section 12.2. Agent's Reliance, Etc.............................108
Section 12.4. The Administrative Agent Individually.............109
Section 12.5. Lender Credit Decision............................110
Section 12.6. Indemnification...................................110
Section 12.7. Successor Agent...................................110
Article XIII Miscellaneous.............................................113
Section 13.1. Amendments, Waivers, Etc..........................113
Section 13.2. Assignments and Participations....................115
Section 13.3. Costs and Expenses................................118
Section 13.4. Indemnities.......................................119
v
TABLE OF CONTENTS
(continued)
Page
Section 13.5. Limitation of Liability...........................121
Section 13.6. Right of Set-off..................................121
Section 13.7. Sharing of Payments, Etc..........................121
Section 13.8. Notices, Etc......................................122
Section 13.9. No Waiver; Remedies...............................124
Section 13.10. Binding Effect....................................124
Section 13.11. Governing Law.....................................124
Section 13.12. Submission to Jurisdiction; Service of Process....124
Section 13.13. Waiver of Jury Trial..............................125
Section 13.14. Marshaling; Payments Set Aside....................125
Section 13.15. Section Titles....................................125
Section 13.16. Execution in Counterparts.........................125
Section 13.17. Entire Agreement..................................126
Section 13.18. Confidentiality...................................126
vi
TABLE OF CONTENTS
(continued)
Page
SCHEDULES
Schedule I - Revolving Credit Commitments
Schedule II - Applicable Lending Offices and Addresses for Notices
Schedule 1.1 - Permitted Transactions
Schedule 4.1 - Corporate Existence
Schedule 4.2 - Consents
Schedule 4.3 - Ownership of Subsidiaries
Schedule 4.6 - Litigation
Schedule 4.14 - Labor Matters
Schedule 4.15 - List of Plans
Schedule 4.16 - Environmental Matters
Schedule 4.18 - Real Property
Schedule 4.20 - Deposit Accounts and Control Accounts
Schedule 4.22 - Pledged Collateral
Schedule 4.23 - Intellectual Property
Schedule 8.1 - Existing Indebtedness
Schedule 8.2 - Existing Liens
Schedule 8.3 - Existing Investments
Schedule 8.8 - Affiliate Transactions
Schedule 11.1 - Commercial Tort Claims
EXHIBITS
Exhibit A - Form of Assignment and Acceptance
Exhibit B - Form of Revolving Credit Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Swing Loan Request
Exhibit E - Form of Letter of Credit Request
Exhibit F - Form of Borrowing Base Certificate
Exhibit G - Form of Notice of Conversion or Continuation
Exhibit H-1 - Form of Opinion of Counsel for the Loan Parties
Exhibit H-2 Form of Opinion of General Counsel for the Loan Parties
Exhibit I - Form of Compliance Certificate
Exhibit J - Form of Interim Order
Exhibit K - Form of Deposit Account Control Agreement
Exhibit L - Form of Securities Account Control Agreement
Exhibit M - Form of Pledge Amendment
Exhibit N - Form of Joinder Agreement
vii
SCHEDULE 1.1
PERMITTED TRANSACTIONS
"Permitted Transactions" means each and any of the following (provided no
Default or Event of Default has occurred and is continuing):
(a) Leases and Contracts. The assumption or rejection by the Loan Parties of
such pre-petition leases and pre-petition contracts as the Borrower from time
to time considers to be necessary or desirable in its reasonable judgment;
(b) Store Rationalization Program/GOB Sales. Closures by the Loan Parties of
up to such number of stores as has been disclosed to the Administrative Agent
by the Borrower prior to the date hereof and the sale at arms' length terms by
the Loan Parties of assets (including, without limitation, inventory, fixtures
and equipment) in connection therewith;
(c) Slow-Moving Inventory Sales. Clearance sales, bulk sales or other
dispositions of slow-moving inventory of the Loan Parties at arms' length
terms;
(d) Vendor Lien Program. (i) The assumption by the Loan Parties of the
Borrower's pre-petition Vendor Lien Program with such changes thereto as the
Borrower deems necessary or desirable in its reasonable judgment; provided
that (A) all Liens thereunder shall be fully subordinated to the
Administrative Agent's Liens on any Collateral subject thereto to at least the
same extent such Liens were subordinated to the obligations of and Liens
granted by the Loan Parties in respect of the Existing Credit Agreement and
(B) such program as so assumed does not require the Loan Parties to make any
payments of any prepetition claims not permitted by the following clause (ii);
and (ii) the payment by the Loan Parties of (A) up to $4,000,000 in respect of
the standstill amount under the prepetition Vendor Lien Program at any time on
or after the later of the entry of the Final Order and the Incremental
Facility Effective Date and (B) up to the remaining balance of such standstill
amount (i.e., $19,000,000) pursuant to a payment plan which shall be
reasonably acceptable to the Administrative Agent and the Borrower (which
balance may in any event may be paid in connection with the consummation of a
plan of reorganization); and
(e) Crescent. (i) The assumption or rejection by the Loan Parties of leases
and executory contracts with Crescent Jewelers, Inc., Crescent Jewelers or any
of their respective subsidiaries (collectively, the "Crescent Parties"), with
such changes thereto as the Borrower deems necessary or advisable in its
reasonable judgment; and (ii) following the Incremental Facility Effective
Date, the Loan Parties, so long as no additional investments are made by the
Borrower or the Subsidiary Guarantors in the Crescent Parties, may take such
other actions as the Borrower deems necessary or desirable in its reasonable
judgment in respect of the Loan Parties' contracts with, claims against, and
investments in, the Crescent Parties, including, without limitation, sales,
releases, settlements or conversions to equity, as applicable, of any of the
foregoing.
