Exhibit 10.2
CREDIT AGREEMENT
by and among
BREED TECHNOLOGIES, INC. AND CERTAIN SUBSIDIARIES as Borrowers,
NATIONSBANK, NATIONAL ASSOCIATION, as Agent and as Lender,
and
THE LENDERS PARTY HERETO FROM TIME TO TIME
October 30, 1997
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Terms
1.1. Definitions. ........................................................ 2
1.2. Rules of Interpretation. ...........................................29
ARTICLE II
The Credit Facilities
2.1. Loans................................................................31
2.2. Payment of Interest. ...............................................37
2.3. Payment of Principal. ...............................................37
2.4. Non-Conforming Payments. ...........................................39
2.5. Notes. .............................................................40
2.6. Pro Rata Payments. .................................................40
2.7. Voluntary Commitment Reductions. ...................................40
2.8. Conversions and Elections of Subsequent Interest Periods. ..........40
2.9. Increase and Decrease in Amounts. ..................................41
2.10. Commitment Fee.......................................................41
2.11. Deficiency Advances. ...............................................42
2.12. Use of Proceeds. ...................................................42
2.13. Designation of Borrowing Subsidiaries................................42
ARTICLE III
Letters of Credit
3.1. Letters of Credit. ..................................................43
3.2. Reimbursement........................................................43
3.3. Letter of Credit Facility Fees. ....................................47
ARTICLE IV
Security
4.1. Guaranty. ..........................................................48
4.2. Stock Pledge. .......................................................48
4.3. Security Interests. ................................................48
4.4. Lease Assignments. .................................................49
4.5. Mortgages. .........................................................49
4.6. Landlord Waivers. ..................................................49
4.7. Intellectual Property................................................49
4.8. Pledge and Subordination of Intercompany Notes. ....................50
4.9. Pledge of Partnership and Joint Venture Interests. ..................50
4.10. Collateral Assignment of Trademark License Agreement.................50
4.11. Further Assurances. ................................................50
ARTICLE V
Change in Circumstances
5.1. Increased Cost and Reduced Return. .................................51
5.2. Limitation on Types of Loans. ......................................52
5.3. Illegality. ........................................................52
5.4. Treatment of Affected Loans. .......................................53
5.5. Compensation. ......................................................53
5.6. Taxes. .............................................................54
5.7. Lending Office. ....................................................55
5.8. Syndication Costs. .................................................55
5.9. Replacement Banks. .................................................56
ARTICLE VI
Conditions to Making Loans and Issuing Letters of Credit
6.1. Conditions of Term Loan and Initial Advance..........................57
6.2. Conditions of all Loans and Letters of Credit. .....................61
ARTICLE VII
Representations and Warranties
7.1. Organization and Authority...........................................63
7.2. Loan Documents. ....................................................63
7.3. Solvency.............................................................64
7.4. Subsidiaries and Stockholders. .....................................64
7.5. Ownership Interests. ...............................................64
7.6. Financial Condition. ................................................64
7.7. Title to Properties. ...............................................65
7.8. Taxes. .............................................................65
7.9. Other Agreements. ..................................................65
7.10. Litigation. ........................................................66
7.11. Margin Stock. ......................................................66
7.12. Investment Company...................................................66
7.13. Patents, Etc. ......................................................66
7.14. No Untrue Statement. ...............................................66
7.15. No Consents, Etc.....................................................67
7.16. Employee Benefit Plans...............................................67
7.17. No Default...........................................................68
7.18. Environmental Matters. .............................................68
7.19. Employment Matters. ................................................68
7.20. RICO. ..............................................................69
7.21. Allied Acquisition Representations. ................................69
7.22. Allied Acquisition. ................................................69
7.23. Perfected Security Instruments.......................................69
ARTICLE VIII
Affirmative Covenants
8.1. Financial Reports, Etc. ............................................71
8.2. Maintain Properties. ...............................................72
8.3. Existence, Qualification, Etc. .....................................73
8.4. Regulations and Taxes. .............................................73
8.5. Insurance. .........................................................73
8.6. True Books. ........................................................73
8.7. Right of Inspection. ...............................................73
8.8. Observe all Laws. ..................................................73
8.9. Governmental Licenses. .............................................74
8.10. Covenants Extending to Other Persons. ..............................74
8.11. Officer's Knowledge of Default. ....................................74
8.12. Suits or Other Proceedings. ........................................74
8.13. Notice of Environmental Complaint or Condition. .....................74
8.14. Environmental Compliance. ..........................................74
8.15. Indemnification. ...................................................75
8.16. Further Assurances. ................................................75
8.17. Employee Benefit Plans...............................................75
8.18. Continued Operations. ..............................................76
8.19. Additional Support Documents. ......................................76
8.20. Operating Plan. ....................................................77
8.21. Allied Acquisition Audit. ..........................................77
8.22. Diligent Pursuit of Waiver. ........................................78
8.23. Swap Agreements. ...................................................78
8.24. Subsidiary Support of Permitted Indebtedness. ......................78
ARTICLE IX
Negative Covenants
9.1. Financial Covenants..................................................79
9.2. Acquisitions. ......................................................80
9.3. Liens. .............................................................80
9.4. Indebtedness. ......................................................81
9.5. Transfer of Assets. .................................................82
9.6. Investments. .......................................................82
9.7. Merger or Consolidation. ...........................................83
9.8. Restricted Payments. ...............................................83
9.9. Transactions with Affiliates. ......................................83
9.10. Compliance with ERISA, the Code and Foreign Benefit Laws. ..........84
9.11. Accounting Changes. ................................................85
9.12. Dissolution, etc. ..................................................85
9.13. Limitations on Sales and Leasebacks. ...............................85
9.14. Change in Control. .................................................85
9.15. Limitation on Guaranties. ..........................................85
9.16. Negative Pledge Clauses..............................................85
9.17. Prepayments, Etc. of Indebtedness. .................................85
9.18. Restrictive Agreements. ...........................................85
ARTICLE X
Events of Default and Acceleration
10.1. Events of Default. ................................................86
10.2. Agent to Act. .....................................................89
10.3. Cumulative Rights. ................................................89
10.4. No Waiver. ........................................................89
10.5. Allocation of Proceeds. ...........................................89
10.6. Judgment Currency. ................................................90
ARTICLE XI
The Agent
11.1. Appointment, Powers, and Immunities. ..............................91
11.2. Reliance by Agent. ................................................91
11.3. Defaults. .........................................................92
11.4. Rights as Lender. .................................................92
11.5. Indemnification. ..................................................92
11.6. Non-Reliance on Agent and Other Lenders. ..........................93
11.7. Resignation of Agent. .............................................93
11.8. Fees................................................................93
ARTICLE XII
Miscellaneous
12.1. Assignments and Participations. ...................................94
12.2. Notices. ..........................................................95
12.3. Right of Set-off; Adjustments. ....................................96
12.4. Survival. .........................................................97
12.5. Expenses. .........................................................97
12.6. Amendments and Waivers. ...........................................98
12.7. Counterparts. .....................................................98
12.8. Termination. ......................................................98
12.9. Indemnification. ..................................................99
12.10. Severability. .....................................................99
12.11. Entire Agreement. ................................................100
12.12. Agreement Controls. ..............................................100
12.13. Usury Savings Clause. ............................................100
12.14. Governing Law; Waiver of Jury Trial................................100
EXHIBIT A Applicable Commitment Percentages..........................A-1
EXHIBIT B-1 Form of Assignment and Acceptance..........................B-1
EXHIBIT C Notice of Appointment (or Revocation) of Authorized
Representative...........................................C-1
EXHIBIT D Form of Borrowing Notice.................................D-1-1
EXHIBIT E Form of Collateral Assignment of Trademark License
Agreement................................................E-1
EXHIBIT F Form of Collateral Assignment of Partnership Interests.....F-1
EXHIBIT G Form of Guaranty...........................................G-2
EXHIBIT H Form of Intellectual Property Security Agreement...........H-1
EXHIBIT I Form of Intercompany Notes.................................I-1
EXHIBIT J Form of Subordination Agreement............................J-1
EXHIBIT K Form of Interest Rate Selection Notice.....................K-1
EXHIBIT L Form of Landlord Waiver....................................L-1
EXHIBIT M Form of LC Account Agreement...............................M-1
EXHIBIT N Form of Lease Assignment...................................N-1
EXHIBIT O-1 Form of Term Note........................................O-1-1
EXHIBIT O-2 Form of Revolving Note...................................O-2-1
EXHIBIT P-1 Form of Stock Pledge Agreement (Borrower)................P-1-1
EXHIBIT P-2 Form of Stock Pledge Agreement (US Subsidiaries).........P-2-1
EXHIBIT P-3 Form of Stock Pledge Agreement (Breeds)..................P-3-1
EXHIBIT Q Form of Intercompany Note Pledge Agreement.................Q-1
EXHIBIT R Form of Security Agreement.................................R-1
EXHIBIT S-1 Form of Opinion of US Counsel............................S-1-1
EXHIBIT S-2 Form of Opinion of Intellectual Property Counsel.........S-2-1
EXHIBIT S-3 Form of Opinion of Foreign Counsel.......................S-3-1
EXHIBIT T Compliance Certificate.....................................T-1
EXHIBIT U Form of Assumption Letter..................................U-1
Schedule 1.1(a) Borrowing Subsidiaries.....................................S-1
Schedule 1.1(b) Initial Advance Allocation ...............................S-2
Schedule 7.4 Subsidiaries and Investments in Other Persons..............S-3
Schedule 7.6 Indebtedness...............................................S-4
Schedule 7.7 Liens......................................................S-5
Schedule 7.10 Litigation.................................................S-6
Schedule 7.19 Employment Matters.........................................S-7
Schedule 7.23 Financing Statements and Other Filings.....................S-8
Schedule 8.5 Insurance..................................................S-9
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 30, 1997 (the "Agreement"), is
made by and among BREED TECHNOLOGIES, INC., a Delaware corporation having its
principal place of business in Lakeland, Florida ( "BREED"), and certain
Subsidiaries of BREED designated as Borrowers herein (BREED and such
Subsidiaries individually a "Borrower" and being collectively called the
"Borrowers") NATIONSBANK, NATIONAL ASSOCIATION, a national banking association
organized and existing under the laws of the United States, in its capacity as a
Lender ("NationsBank"), and each other financial institution which may hereafter
execute and deliver an instrument of assignment with respect to this Agreement
pursuant to Section 12.1 (hereinafter such financial institutions may be
referred to individually as a "Lender" or collectively as the "Lenders"), and
NATIONSBANK, NATIONAL ASSOCIATION, a national banking association organized and
existing under the laws of the United States, in its capacity as agent for the
Lenders (in such capacity, and together with any successor agent appointed in
accordance with the terms of Section 11.7, the "Agent");
W I T N E S S E T H:
WHEREAS, BREED and certain of its wholly-owned Subsidiaries have entered
into that certain Asset Purchase Agreement dated August 27, 1997 with
AlliedSignal Inc., a Delaware corporation ("AlliedSignal"), and certain of its
subsidiaries (the "Asset Purchase Agreement") pursuant to which BREED has agreed
to purchase or cause certain of its Subsidiaries to purchase certain assets and
liabilities of AlliedSignal and such subsidiaries including the business of
designing, manufacturing, and selling automotive restraint products and systems
(the "Acquired Business");
WHEREAS, the Borrowers have requested that the Lenders make available to
the Borrowers certain credit facilities of up to $900,000,000, which facilities
shall consist of a term loan facility to BREED of $600,000,000 and a revolving
credit facility to the Borrowers of up to $300,000,000, the latter of which will
include a $25,000,000 sublimit for the issuance of standby letters of credit and
a $75,000,000 sublimit for multi-currency borrowings, the proceeds of which are
to be used as provided in Section 2.12 hereof; and
WHEREAS, the Lenders are willing to make such revolving credit and letter
of credit facilities available to the Borrowers upon the terms and conditions
set forth herein;
NOW, THEREFORE, the Borrowers, the Lenders and the Agent hereby agree as
follows:
ARTICLE I
Definitions and Terms
1.1 Definitions. For the purposes of this Agreement, in addition to the
definitions set forth above, the following terms shall have the respective
meanings set forth below:
"Acquisition" means the acquisition of (i) a controlling equity interest in
another Person (including the purchase of an option, warrant or convertible or
similar type security to acquire such a controlling interest at the time it
becomes exercisable by the holder thereof), whether by purchase of such equity
interest or upon exercise of an option or warrant for, or conversion of
securities into, such equity interest, or (ii) assets of another Person which
constitute all or substantially all of the assets of such Person or of a line or
lines of business conducted by such Person. The term "controlling interest"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through
ownership of Voting Sock, by contract or otherwise.
"Acquisition Documents" means the Asset Purchase Agreement and all other
documents required to be delivered
by AlliedSignal and its Subsidiaries to BREED and its Subsidiaries pursuant
to the Asset Purchase Agreement.
"Advance" means a borrowing under the Revolving Credit Facility consisting
of a Base Rate Loan or a Eurodollar Rate Loan.
"Advance Date Exchange Rate" means, with respect to a specified Advance or
Loan in an Alternative Currency, the Spot Rate of Exchange as of the date two
Business Days preceding the date such Advance is originally made, provided that,
if such Advance or Loan is Continued for a subsequent Interest Period or
Converted pursuant to Section 2.8, the Advance Date Exchange Rate with respect
to such Loan shall be the Spot Rate of Exchange two Business Days preceding the
effective date of the latest Continuation or Conversion of such Advance or Loan,
and the Dollar Value of such Advance or Loan shall be adjusted as set forth in
Section 2.1(b).
"Affiliate" means any Person (i) which directly or indirectly through one
or more intermediaries controls, or is controlled by, or is under common control
with BREED; or (ii) which beneficially owns or holds 5% or more of any class of
the outstanding Voting Stock (or in the case of a Person which is not a
corporation, 5% or more of the equity interest) of BREED or 5% or more of any
class of the outstanding Voting Stock (or in the case of a Person which is not a
corporation, 5% or more of the equity interest) of which is beneficially owned
or held by BREED. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through ownership of Voting Stock, by contract or
otherwise; provided that Integrated Sensor Solutions, Inc., a California
corporation, shall not be deemed an Affiliate of BREED for the purposes of this
Agreement.
"Allied Acquisition" means the acquisition by BREED and certain of its
Subsidiaries of the Acquired Business pursuant to the Asset Purchase Agreement
for an aggregate purchase price not to exceed $710,000,000, subject to
adjustment as provided in the Asset Purchase Agreement.
"Alternative Currency" means Pounds Sterling, French Francs, Italian Lire,
Deutsch Marks, Spanish Pesetas, and with the prior written consent of all
Lenders and the Agent, any other lawful currency other than Dollars which is
readily transferable and convertible into Dollars in the United States currency
market; provided, however, that an Alternative Currency (other than those
specified above) shall only be available to a Borrower to the extent that each
Lender shall have determined (which determination shall be conclusive) that it
has access to such Alternative Currency on terms reasonably acceptable to such
Lender and that the Alternative Currency is freely transferable and convertible
into Dollars.
"Alternative Currency Equivalent Amount" means with respect to a specified
Alternative Currency and a specified Dollar amount, the amount of such
Alternative Currency into which such Dollar amount would be Converted, based on
the applicable Advance Date Exchange Rate.
"Applicable Commitment Percentage" means, with respect to each Lender that
portion of the Total Credit Commitment, Total Revolving Credit Commitment or
Total Term Loan Commitment, as the case may be, (including its Participations
and its obligations hereunder to the Issuing Bank to acquire Participations)
allocable to such Lender (i) with respect to Lenders as of the Closing Date, as
set forth in Exhibit A and (ii) with respect to any Person who becomes a Lender
hereafter, as reflected in each Assignment and Acceptance to which such Lender
is a party Assignee; provided that the Applicable Commitment Percentage of each
Lender shall be increased or decreased to reflect any assignments to or by such
Lender effected in accordance with Section 12.1.
"Applicable Lending Office" means, for each Lender and for each Type of
Loan, the Lending Office" of such Lender (or of an affiliate of such Lender)
designated for such Type of Loan on the signature pages hereof or such other
office of such Lender (or an affiliate of such Lender) as such Lender may from
time to time specify to the Agent and BREED by written notice in accordance with
the terms hereof as the office by which its Loans of such Type are to be made
and maintained.
"Applicable Margin" means for each Eurodollar Rate Loan or Base Rate Loan
that percent per annum as set forth below, which shall be based upon the length
of time the Revolving Credit Facility is in existence as specified below:
Phase Dates Applicable Margin for Applicable Margin for
Eurodollar Rate Loans Base Rate Loans
I Closing Date through January 27, 1998 3.00% 2.00%
II January 28, 1998 through February 26, 3.75% 2.75%
1998
III February 27, 1998 through April 27, 1998 4.50% 3.50%
IV April 28, 1998 and thereafter 6.00% 5.00%
"Applications and Agreements for Letters of Credit" means, collectively,
the Applications and Agreements for Letters of Credit, or similar documentation,
executed by a Borrower from time to time and delivered to the Issuing Bank to
support the issuance of Letters of Credit.
"Approved Fund" means, with respect to any Lender that is a fund that
invests in commercial loans, any other fund that invests in commercial loans and
is managed by the same investment advisor as such Lender or by an Affiliate of
such investment advisor.
"Asset Disposition" means any voluntary disposition, whether by sale, lease
or transfer of (a) any or all of the assets, excluding cash, cash equivalents
and inventory, of BREED or its Subsidiaries, where the Net Proceeds from any
such sale, lease or transfer exceed $50,000, and (b) any of the capital stock,
or securities and investments interchangeable, exercisable or convertible for or
into, or otherwise entitling the holder to receive, any of the capital stock of
any Subsidiary (other than a disposition to BREED or a Guarantor in the case of
(a) and (b)).
"Assigned Interests" has the meaning given to such term in any Collateral
Assignment of Partnership and Joint Venture Interests. "Assignment and
Acceptance" shall mean an Assignment and Acceptance in the form of Exhibit B
(with blanks appropriately filled in) executed and delivered to the Agent by the
parties thereto in connection with an assignment of a Lender's interest under
this Agreement pursuant to Section 12.1.
"Authorized Representative" means any of the Chief Executive Officer,
President, any Executive or Senior Vice President or Treasurer of BREED or, with
respect to financial matters, the chief financial officer or Treasurer of BREED,
or any other Person expressly designated by the Board of Directors of BREED (or
the appropriate committee thereof) as an Authorized Representative of BREED, as
set forth from time to time in a certificate in the form of Exhibit C.
"Base Rate" means the sum of (i) for any day, the rate per annum equal to
the higher of (a) the Federal Funds Rate for such day plus one-half of one
percent (0.5%) or (b) the Prime Rate for such day and (ii) the Applicable
Margin. Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such change in
the Prime Rate or Federal Funds Rate.
"Base Rate Loan" means a Dollar denominated Loan or a Dollar denominated
Segment of the Term
Loan for which the rate of interest is determined by reference to the Base
Rate.
"Base Rate Refunding Loan" means a Base Rate Loan made to satisfy
Reimbursement Obligations arising from a drawing under a Letter of Credit.
"Base Rate Segment" means a Segment bearing interest or to bear interest at
the Base Rate.
"Board" means the Board of Governors of the Federal Reserve System (or any
successor body).
"Borrowers' Account" means a demand deposit account number 3750894026 or
any successor account with the Agent, which may be maintained at one or more
offices of the Agent or an agent of the Agent.
"Borrowing Notice" means the notice delivered by an Authorized
Representative in connection with an Advance under the Revolving Credit Facility
in the form of Exhibit D hereto.
"Borrowing Subsidiary" means those Subsidiaries listed on Schedule 1.1(a)
as a Borrower under the Revolving Credit Facility and such other Foreign
Subsidiaries of BREED that are so designated pursuant to Section 2.13 hereof.
"Business Day" means, (i) with respect to any Base Rate Loan, any day which
is not a Saturday, Sunday or a day on which banks in the States of New York and
North Carolina are authorized or obligated by law, executive order or
governmental decree to be closed, and (ii) with respect to any Eurodollar Rate
Loan, any day which is a Business Day, as described above, and on which the
relevant international financial markets are open for the transaction of
business contemplated by this Agreement in London, England, New York, New York
and Charlotte, North Carolina.
"Capital Expenditures" means, with respect to BREED and its Subsidiaries,
for any period the sum of (without duplication) (i) all expenditures (whether
paid in cash or accrued as liabilities) by BREED or any Subsidiary during such
period for items that would be classified as "property, plant or equipment" or
comparable items on the consolidated balance sheet of BREED and its
Subsidiaries, including without limitation all transactional costs incurred in
connection with such expenditures provided the same have been capitalized,
excluding, however, the amount of any Capital Expenditures paid for with
proceeds of casualty insurance as evidenced in writing and submitted to the
Agent together with any compliance certificate delivered pursuant to Section
8.1(a) or (b), and (ii) with respect to any Capital Lease entered into by BREED
or its Subsidiaries during such period, the present value of the lease payments
due under such Capital Lease over the term of such Capital Lease applying a
discount rate equal to the interest rate provided in such Capital Lease (or in
the absence of a stated interest rate, that rate used in the preparation of the
financial statements described in Section 8.1(a)), all the foregoing in
accordance with GAAP applied on a Consistent Basis.
"Capital Leases" means all leases which have been or should be capitalized
in accordance with GAAP as in effect from time to time including Statement No.
13 of the Financial Accounting Standards Board and any successor thereof.
"Certificate and Receipt of Registrar" means, collectively or individually
as the context may indicate (i) that certain Certificate and Receipt of
Registrar dated as of the Closing Date between certain Subsidiaries and
the Agent in the form attached to the Collateral Assignment of Partnership
and Joint Venture Interests as Schedule I and (ii) any additional Certificate
and Receipt of Registrar delivered to the Agent pursuant to Section 8.19, as any
of the foregoing may be hereafter amended, supplemented or restated from time to
time.
"Change of Control" means, at any time:
(i) any "person" or "group" (each as used in Sections 13(d)(3) and 14(d)(2)
of the Exchange Act), other than Xxxxx X. Breed, Xxxxxxx X. Breed, Siemens AG,
A. Breed, Ltd., a Texas limited partnership, or J. Breed, Ltd., a Texas limited
partnership, either (A) becomes the "beneficial owner" (as defined in Rule 13d-3
of the Exchange Act ), directly or indirectly, of Voting Stock of BREED (or
securities convertible into or exchangeable for such Voting Stock) representing
30% or more of the combined voting power of all Voting Stock of BREED (on a
fully diluted basis) or (B) otherwise has the ability, directly or indirectly,
to elect a majority of the board of directors of BREED; provided, however, that
this subsection shall apply only to any "person" or "group" (each as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) who is not identified
hereunder.
(ii) during any period of up to 12 consecutive months, commencing on the
Closing Date, individuals who at the beginning of such 12-month period were
directors of BREED shall cease for any reason (other than the death, disability
or retirement of an officer of BREED that is serving as a director at such time
so long as another officer of BREED replaces such Person as a director) to
constitute a majority of the board of directors of BREED; or
(iii) any Person or two or more Persons (other than those Persons
identified in clause (i) above or existing directors) acting in concert shall
have acquired by contract, or shall have entered into a contract or agreement
and satisfied any conditions to effectiveness, that, upon consummation thereof,
will result in its or their acquisition of the power to exercise, directly or
indirectly, more than 50% of the combined voting power of all Voting Stock of
BREED (on a fully diluted basis).
"Closing Date" means the date as of which this Agreement is executed by the
Borrowers, the Lenders and the Agent and on which the conditions set forth in
Section 6.1 have been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder.
"Collateral" means the collateral described in the Security Instruments.
"Collateral Assignment of Trademark License Agreement" means that certain
Collateral Assignment of Trademark License Agreement dated as of the Closing
Date by BREED in favor of the Agent and consented to by AlliedSignal
substantially in the form of Exhibit E hereto and pursuant to which BREED and
BREED Automotive Technology, Inc. have collaterally assigned, pledged and
granted a Lien in all of its rights and under that certain Trademark License
Agreement dated October 30, 1997 between BREED and Allied Signal to the Agent
for the benefit of the Lenders, as amended, modified, or restated from time to
time.
"Collateral Assignment of Partnership Interests" means, (i) the Collateral
Assignment of Partnership Interests dated as of the Closing Date between BREED,
certain Subsidiaries and the Agent and (ii) each
Collateral Assignment of Partnership Interests substantially in the form of
Exhibit F delivered to the Agent pursuant to Section 8.19, as any of the
foregoing may be hereafter amended, supplemented or restated from time to time.
"Commitment Fee" means one half percent (0.50%) per annum.
"Consistent Basis" in reference to the application of GAAP means the
accounting principles observed in the period referred to are comparable in all
material respects to those applied in the preparation of the audited financial
statements of BREED referred to in Section 7.6(a).
"Consolidated EBITDA" means, with respect to BREED and its Subsidiaries for
any period of computation ending on the date of computation thereof, (A) the sum
of, without duplication, (i) Consolidated Net Income, (ii) Consolidated Interest
Expense, (iii) taxes on income, (iv) amortization and (v) depreciation, minus
(B) (a) net gains or losses on the sale, conversion or other disposition of
capital assets, (b) net gains or losses on the acquisition, retirement, sale or
other disposition of capital stock and other securities of BREED or its
Subsidiaries, (c) net gains on the collection of proceeds of the life insurance
policies, (d) any write-up of any asset other than as permitted in accordance
with Statement No. 16 of the Financial Accounting Standards Board, and (e) any
other net gain or loss or credit of an extraordinary nature as determined in
accordance with GAAP applied on a Consistent Basis.
"Consolidated Interest Expense" means, with respect to any period of
computation thereof, the gross interest expense of BREED and its Subsidiaries,
including without limitation (i) the current amortized portion of debt discounts
to the extent included in gross interest expense, (ii) the current amortized
portion of all fees (including fees payable in respect of any Swap Agreement and
Letters of Credit) payable in connection with the incurrence of Indebtedness to
the extent included in gross interest expense and (iii) the portion of any
payments made in connection with Capital Leases allocable to interest expense,
in each of the foregoing cases determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated Net Income" means, for any period of computation thereof, the
gross revenues from operations of BREED and its Subsidiaries (including payments
received by BREED and its Subsidiaries of (i) interest income, and (ii)
dividends and distributions made in the ordinary course of their businesses by
Persons in which investment is permitted pursuant to this Agreement and not
related to an extraordinary event), less all operating and non-operating
expenses of BREED and its Subsidiaries including taxes on income, all determined
on a consolidated basis in accordance with GAAP applied on a Consistent Basis.
"Consolidated Shareholders' Equity" means, as of any date on which the
amount thereof is to be determined, the sum of the following in respect of BREED
and its Subsidiaries (determined on a consolidated basis): (i) the amount of
issued and outstanding share capital, plus (ii) the amount of additional paid-in
capital and retained earnings (or, in the case of a deficit, minus the amount of
such deficit), plus (iii) the amount of any foreign currency translation
adjustment (if positive, or, if negative, minus the amount of such translation
adjustment), minus (iv) the amount of any treasury stock, all as determined in
accordance with GAAP applied on a Consistent Basis.
"Consolidated Total Assets" means, as of the date on which the amount
thereof is to be determined, the net book value of all assets of BREED and its
Subsidiaries as determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Contingent Obligation" of any Person means all contingent liabilities
required (or which, upon the creation or incurring thereof, would be required)
to be included in the financial statements (including footnotes but excluding
any actual or threatened litigation) of such Person in accordance with GAAP
applied on a Consistent Basis, including Statement No. 5 of the Financial
Accounting Standards Board, all Rate Hedging Obligations and any obligation of
such Person guaranteeing or in effect guaranteeing any Indebtedness, dividend or
other obligation of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including obligations of such Person however
incurred:
(1) to purchase such Indebtedness or other obligation or any property or
assets constituting security therefor;
(2) to advance or supply funds in any manner (i) for the purchase or
payment of such Indebtedness or other obligation, or (ii) to maintain a minimum
working capital, net worth or other balance sheet condition or any income
statement condition of the primary obligor;
(3) to grant or convey any lien, security interest, pledge, charge or other
encumbrance on any property or assets of such Person to secure payment of such
Indebtedness or other obligation of the primary obligor;
(4) to lease property or to purchase securities or other property or
services primarily for the purpose of assuring the owner or holder of such
Indebtedness or obligation of the ability of the primary obligor to make payment
of such Indebtedness or other obligation; or
(5) otherwise to assure the owner of the Indebtedness or such obligation of
the primary obligor against loss in respect thereof;
excluding, however, Contingent Obligations (other than Guaranties) incurred
in the ordinary course of business which, in the aggregate, will not have a
Material Adverse Effect.
"Continue", "Continuation", and "Continued" shall refer to the continuation
pursuant to Section 2.8 hereof of a Eurodollar Rate Loan of one Type as a
Eurodollar Rate Loan of the same Type from one Interest Period to the next
Interest Period.
"Convert", "Conversion", and "Converted" shall refer to a conversion
pursuant to Section 2.8 or Article IV of one Type of Loan into another Type of
Loan.
"Convertible Debentures" means the __% Convertible Subordinated Debentures
due 2027 in an aggregate principal amount of at least $200,000,000 issued by
BREED to BTI Capital Trust in consideration of the issuance of the Convertible
Preferred Securities and payment of the net proceeds thereof to BREED.
"Convertible Preferred Securities" means at least 4,000,000 ____%
Convertible Trust Preferred Securities issued by BTI Capital Trust (the "BTI
Trust"), a trust created or to be created solely for the purpose of issuing the
Convertible Preferred Securities for so long as such preferred securities are
not accounted for
under stockholder's equity in the consolidated financial statements of
BREED; provided that such Convertible Preferred Securities shall be subject to
the following conditions: (i) the BTI Trust, at the direction of BREED, shall be
entitled in its discretion to defer payment of distributions on the Convertible
Preferred Securities for up to twenty (20) consecutive quarters (the "Deferral
Period"); provided that no such deferral may extend beyond the maturity date of
the Convertible Preferred Securities;
(ii) at least five (5) quarters shall remain in the Deferral Period when
the BTI Trust elects to defer payment of distributions; and
(iii) the Convertible Preferred Securities shall not be treated as a
liability on the Consolidated Financial Statements of BREED in accordance with
GAAP;
"Convertible Preferred Securities Issuance" means (a) completion of the
Offering Memorandum, (b) the consummation of the sale of the Converrtible
Preferred Securities contemplated thereby and (c) the issuance of the
Convertible Debentures and receipt of net proceeds thereof by BREED;
"Credit Commitment" means, with respect to each Lender, the obligation of
such Lender to make Loans to the Borrowers up to an aggregate principal amount
at any one time outstanding equal to such Lender's Applicable Commitment
Percentage of the Total Credit Commitment.
"Credit Parties" means any or all of the Borrowers and the Guarantors, as
the case may be.
"Debt Offering" means the incurrence of any Indebtedness for Money Borrowed
permitted hereunder in connection with a public offering or private placement of
debt securities of BREED or any Subsidiary (other than debt securities issued to
BREED or a Guarantor) or otherwise.
"Default" means any event or condition which, with the giving or receipt of
notice or lapse of time or both, would constitute an Event of Default hereunder.
"Default Rate" means (i) with respect to each Eurodollar Rate Loan, until
the end of the Interest Period applicable thereto, a rate of two percent (2%)
above the Eurodollar Rate applicable to such Loan, and thereafter at a rate of
interest per annum which shall be two percent (2%) above the Base Rate, (ii)
with respect to Base Rate Loans, at a rate of interest per annum which shall be
two percent (2%) above the Base Rate, and (iii) in any case, the maximum rate
permitted by applicable law, if lower.
"Deutsch Marks" means the official currency of Germany.
"Direct Foreign Subsidiary" means any Foreign Subsidiary a majority of
whose outstanding Voting Stock is owned by BREED or a Domestic Subsidiary.
"Dollar Equivalent Amount" means, with respect to a specified Alternative
Currency amount, the amount of Dollars into which the Alternative Currency
amount would be converted, based on the applicable Advance Date Exchange Rate.
"Dollar Value" of an Advance or a Loan in an Alternative Currency means the
Dollar Equivalent Amount of the principal amount of such Advance or Loan based
on the Advance Date Exchange Rate with respect to such Advance or Loan, as
recorded in the Agent's records pursuant to Section 2.1.
"Dollars" and the symbol "$" means dollars constituting legal tender for
the payment of public and private debts in the United States of America.
"Domestic Subsidiary" means any Subsidiary of BREED organized under the
laws of the United States of America or a state or territory thereof, except the
Excluded Subsidiary.
"Eligible Assignee" means (i) a Lender; (ii) an affiliate or Approved Fund
of a Lender; and (iii) any other Person approved by the Agent and, unless an
Event of Default has occurred and is continuing at the time any assignment is
effected in accordance with Section 11.1, BREED, such approval not to be
unreasonably withheld or delayed by BREED, it being agreed that BREED may
withhold its approval if as a result of such assignment BREED incurs increased
cost under Section 5.6; provided, however, that neither BREED nor an affiliate
of BREED shall qualify as an Eligible Assignee.
"Eligible Securities" means the following obligations and any other
obligations previously approved in writing by the Agent:
(a) Government Securities;
(b) obligations of any corporation organized under the laws of any state of
the United States of America or under the laws of any other nation, payable in
the United States of America, expressed to mature not later than 92 days
following the date of issuance thereof and rated in an investment grade rating
category by S&P and Xxxxx'x;
(c) interest bearing demand or time deposits issued by any Lender or
certificates of deposit maturing within one year from the date of issuance
thereof and issued by a bank or trust company organized under the laws of the
United States or of any state thereof having capital surplus and undivided
profits aggregating at least $400,000,000 and being rated "A-3" or better by S&P
or "A" or better by Xxxxx'x;
(d) Repurchase Agreements;
(e) Municipal Obligations;
(f) Pre-Refunded Municipal Obligations;
(g) shares of mutual funds which invest in obligations described in
paragraphs (a) through (f) above, the shares of which mutual funds are at all
times rated "AAA" by S&P;
(h) tax-exempt or taxable adjustable rate preferred stock issued by a
Person having a rating of its long term unsecured debt of "A" or better by S&P
or "A-1" or better by Xxxxx'x; and
(i) asset-backed remarketed certificates of participation representing a
fractional undivided interest
in the assets of a trust, which certificates are rated at least "A-1" by
S&P and "P-1" by Xxxxx'x.
"Employee Benefit Plan" means (i) any employee benefit plan, including any
Pension Plan, within the meaning of Section 3(3) of ERISA which (A) is
maintained for employees of BREED, any of its ERISA Affiliates, or any
Subsidiary or is assumed by BREED, any of its ERISA Affiliates, or any
Subsidiary in connection with any Acquisition or (B) has at any time been
maintained for the employees of BREED, any current or former ERISA Affiliate, or
any Subsidiary and (ii) any plan, arrangement, understanding or scheme
maintained by BREED or any Subsidiary that provides retirement, deferred
compensation, employee or retiree medical or life insurance, severance benefits
or any other benefit covering any employee or former employee and which is
administered under any Foreign Benefit Law or regulated by any Governmental
Authority other than the United States of America.
"Environmental Laws" means any federal, state, local or foreign statute,
law, ordinance, code, rule, regulation, order, decree, permit or license
regulating, relating to, or imposing liability or standards of conduct
concerning, any environmental matters or conditions, environmental protection or
conservation, including without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended; the Superfund
Amendments and Reauthorization Act of 1986, as amended; the Resource
Conservation and Recovery Act, as amended; the Toxic Substances Control Act, as
amended; the Clean Air Act, as amended; the Clean Water Act, as amended;
together with all regulations promulgated thereunder, and any other "Superfund"
or "Superlien" law."
"Equity Offering" means a public or private offering of equity securities
(including, without limitation, any security or investment exchangeable,
exercisable or convertible for or into, or otherwise entitling the holder to
receive, equity securities) of BREED or any Subsidiary (other than securities
issued to BREED or another Subsidiary); provided, however, that the term "Equity
Offering" shall not include (i) any issuance of equity securities in connection
with the exercise of stock options granted to, or purchase of restricted stock
by, eligible participants under the Stock Option Plans, (ii) the issuance of any
stock issued as dividends or distributions to Siemens, AG (or its Subsidiary) in
accordance with the Siemens Stock Purchase Agreement, (iii) the issuance of the
Convertible Preferred Securities, (iv) the issuance of the Convertible
Debentures or any equity securities upon the conversion of any Convertible
Debentures, or (v) the issuance of the Series B Preference Shares.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute and all rules and
regulations promulgated thereunder.
"ERISA Affiliate", as applied to BREED, means any Person or trade or
business which is a member of a group which is under common control with BREED,
who together with BREED, is treated as a single employer within the meaning of
Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Rate Loan" means a Loan or Segment of the Term Loan for which
the rate of interest is determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means the interest rate per annum calculated according to
the following formula:
Eurodollar = Interbank Offered Rate + Applicable
Rate 1 - Reserve Requirement Margin
"Eurodollar Rate Segment" means a Segment bearing interest or to bear
interest at the Eurodollar Rate.
"Event of Default" means any of the occurrences set forth as such in
Section 10.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the regulations promulgated thereunder.
"Excluded Subsidiary" means, collectively, BREED International, Inc., a
U.S. Virgin Islands corporation and BTI Trust, a Delaware _______ trust.
"Facility Termination Date" means the date on which both the Revolving
Credit Termination Date and the Term Loan Termination Date shall have occurred,
no Letters of Credit shall remain outstanding or all the Letters of Credit shall
have been cash collateralized, all Swap Agreements shall have been terminated or
cash collateralized and the Borrowers shall have fully paid and satisfied in
full all Obligations.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York (Statistical Release H-15) on the Business
Day next succeeding such day; provided that (a) if such day is not a Business
Day, the Federal Funds Rate for such day shall be such rate on such transactions
on the next preceding Business Day as so published on the next succeeding
Business Day, and (b) if no such rate is so published on such next succeeding
Business Day, the Federal Funds Rate for such day shall be the average rate
charged to the Agent (in its individual capacity) on such day on such
transactions as determined by the Agent. "Fiscal Year" means the twelve month
fiscal period of BREED commencing on the July 1 of each calendar year and ending
on June 30 of the following calendar year.
"Foreign Benefit Law" means any applicable statute, law, ordinance, code,
rule, regulation, order or decree of any foreign nation or any province, state,
territory, protectorate or other political subdivision thereof regulating,
relating to, or imposing liability or standards of conduct concerning, any
Employee Benefit Plan.
"Foreign Subsidiary" means any Subsidiary of BREED that is not a Domestic
Subsidiary.
"Four-Quarter Period" means a period of four full consecutive fiscal
quarters of BREED and its Subsidiaries, taken together as one accounting period.
"French Francs" means the official currency of France.
"Funding Bank" means any banking institution approved by the Agent located
within a country which country's currency has been approved by the Lenders as an
Alternative Currency.
"GAAP" or "Generally Accepted Accounting Principles" means generally
accepted accounting principles, being those principles of accounting set forth
in pronouncements of the Financial Accounting Standards Board, the American
Institute of Certified Public Accountants or which have other substantial
authoritative support and are applicable in the circumstances as of the date of
a report.
"Government Securities" means direct obligations of, or obligations the
timely payment of principal and interest on which are fully and unconditionally
guaranteed by, the United States of America.
"Governmental Authority" shall mean any Federal, state, municipal, national
or other governmental department, commission, board, bureau, court, agency or
instrumentality or political subdivision thereof or any entity or officer
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to any government or any court, in each case whether
associated with a state of the United States, the United States, or a foreign
entity or government including, but not limited to, the governments of Italy,
Germany, France, Spain, Mexico, the United Kingdom, Ireland, Finland and
Hungary.
"Guaranties" means all obligations of BREED or any Subsidiary directly or
indirectly guaranteeing, or in effect guaranteeing, any Indebtedness or other
obligation of any other Person.
"Guarantors" means, at any date, the Domestic Subsidiaries.
"Guarantors' Obligations" has the meaning ascribed to such term in the
Guaranty.
"Guaranty" means each Guaranty Agreement between one or more Guarantors and
the Agent for the benefit of the Lenders, delivered as of the Closing Date and
otherwise pursuant to Section 8.19 substantially in the form of Exhibit G hereto
as the same may be amended, supplemented or restated.
"Hazardous Material" means and includes any pollutant, contaminant, or
hazardous, toxic or dangerous waste, substance or material (including without
limitation petroleum products, asbestos-containing materials and lead), the
generation, handling, storage, transportation, disposal, treatment, release,
discharge or emission of which is subject to any Environmental Law.
"Indebtedness" means with respect to any Person, without duplication, all
Indebtedness for Money Borrowed, all indebtedness of such Person for the
acquisition of property or arising under Rate Hedging Obligations, all
indebtedness secured by any Lien on the property of such Person whether or not
such indebtedness is assumed, all liability of such Person by way of
endorsements (other than for collection or deposit in the ordinary course of
business), all Contingent Obligations, including letters of credit and other
items which in accordance with GAAP is required to be classified as a liability
on a balance sheet; but excluding all accounts payable and accruals in the
ordinary course of business so long as payment therefor is due within one year;
provided that in no event shall the term Indebtedness include surplus and
retained earnings, lease obligations (other than pursuant to Capital Leases),
reserves for deferred income taxes and investment credits, other deferred
credits or reserves and, so long as there is no Indenture Event of Default, both
the Convertible Preferred Securities and the Convertible Debentures (so long as
the Convertible Debentures are held by the BTI Trust).
"Indebtedness for Money Borrowed" means with respect to any Person, without
duplication, all indebtedness in respect of money borrowed, including without
limitation all Capital Leases and the deferred purchase price of any property or
asset, evidenced by a promissory note, bond, debenture or similar written
obligation for the payment of money (including conditional sales or similar
title retention agreements), other than trade payables and short-term accounts
payable incurred in the ordinary course of business.
"Indenture Event of Default" means the occurrence of an Event of Default as
defined in the Indenture between the Borrower and a Trustee for the holder of
the Convertible Debentures pursuant to which Indenture the Convertible
Debentures shall be issued.
"Intellectual Property Assignments" means those certain Assignments of
Patents, Trademarks, Copyrights and Licenses in the form attached to the
Intellectual Property Security Agreement as Exhibit A, to be filed upon
acceleration of the Obligations hereunder, as from time to time amended,
supplemented or restated.
"Intellectual Property Security Agreement" means collectively each
Intellectual Property Security Agreement executed by BREED and Breed Automotive
Technology, Inc. (whether of even date herewith or delivered after the Closing
Date pursuant to Section 8.19 hereof and whether executed individually or
jointly and severally with other Subsidiaries) in favor of the Agent to
collaterally secure payment and performance of its respective obligations
hereunder and under the Guaranty, as applicable, substantially in the form of
Exhibit H attached hereto and incorporated herein by reference as from time to
time amended, supplemented or restated.
"Interbank Offered Rate" means, for any Eurodollar Rate Loan or Eurodollar
Rate Segment for any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Telerate Page
3750 (or any successor page) as the London interbank offered rate for deposits
in Dollars at approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period for a term comparable to such Interest
Period. If for any reason such rate is not available, the term "Eurodollar Rate"
shall mean, for any Eurodollar Rate Loan for any Interest Period therefor, the
rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
appearing on Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to such
Interest Period; provided, however, if more than one rate is specified on
Reuters Screen LIBO Page, the applicable rate shall be the arithmetic mean of
all such rates (rounded upwards, if necessary, to the nearest 1/100 of 1%).
"Intercompany Advance" means a loan or advance heretofore or hereafter made
by an Intercompany Note Holder to a Borrower or a Domestic Subsidiary which is
evidenced by an Intercompany Note in which the Agent has a valid, duly
perfected, first priority Lien under the Collateral Assignment of Intercompany
Notes, and the repayment of which is subordinated to the rights of the Agent and
the Lenders under the Loan Documents in accordance to the provisions set forth
in the Intercompany Notes or in the Intercompany Note Subordination Agreement.
"Intercompany Notes" means, collectively, the promissory notes heretofore
issued and described on Schedule A to the Intercompany Note Pledge Agreement and
promissory notes hereafter issued in the form attached as Exhibit I hereto (with
appropriate insertions) outstanding from time to time evidencing the
Intercompany Advances.
"Intercompany Note Holder" means, at any date, any Borrower and any
Domestic Subsidiary who has extended any Intercompany Advance that remains
outstanding at such date.
"Intercompany Note Pledge Agreement" means, collectively (i) each
Intercompany Note Pledge Agreement of even date herewith between a Borrower and
the Agent and (ii) each Intercompany Note Pledge
Agreement between each Intercompany Note Holder other than a Borrower and
the Agent, substantially in the form of Exhibit Q, pursuant to which the Agent
is granted a Lien in the Intercompany Notes held by such Intercompany Note
Holder, in each case as the same may be amended, supplemented or restated from
time to time.
"Intercompany Note Subordination Agreement" means that certain
Subordination Agreement dated as of the Closing Date between the Intercompany
Note Holders and the Agent substantially in the form of Exhibit J hereto, as
amended, supplemented, or restated from time to time.
"Interest Period" means, for each Eurodollar Rate Loan or Eurodollar Rate
Segment, a period commencing on the date such Eurodollar Rate Loan or Eurodollar
Rate Segment is made or Converted and ending, at the Borrower's option, on the
date one, two, or three months thereafter as notified to the Agent by the
Authorized Representative three (3) Business Days prior to the beginning of such
Interest Period; provided, that,
(i) if the Authorized Representative fails to notify the Agent of the
length of an Interest Period three (3) Business Days prior to the first day of
such Interest Period, the Loan or Segment for which such Interest Period was to
be determined shall be deemed to be a Base Rate Loan or Base Rate Segment as of
the first day thereof;
(ii) if an Interest Period for a Eurodollar Rate Loan or Eurodollar Rate
Segment would end on a day which is not a Business Day, such Interest Period
shall be extended to the next Business Day (unless such extension would cause
the applicable Interest Period to end in the succeeding calendar month, in which
case such Interest Period shall end on the next preceding Business Day);
(iii) any Interest Period which 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;
(iv) no Interest Period shall extend past the Stated Termination Date; and
(v) there shall not be more than ten (10) Interest Periods in effect on any
day.
"Interest Rate Selection Notice" means the written notice delivered by an
Authorized Representative in connection with the election of a subsequent
Interest Period for any Eurodollar Rate Loan or Eurodollar Rate Segment or the
Conversion of any Eurodollar Rate Loan or Eurodollar Rate Segment into a Base
Rate Loan or Base Rate Segment or the Conversion of any Base Rate Loan or Base
Rate Segment into a Eurodollar Rate Loan or Eurodollar Rate Segment, in the form
of Exhibit K.
"Initial Advance Allocation" means the allocation set forth on Schedule
1.1(b) of the initial Advance made hereunder among the Borrowers.
"Issuing Bank" means initially NationsBank and thereafter any Lender which
is successor to NationsBank as issuer of Letters of Credit under Article III.
"Italian Lire" means the official currency of Italy.
"Landlord Waivers" means, collectively, each of the Landlord Waivers
required by the Agent to be delivered by the landlord of each facility leased by
BREED or any Domestic Subsidiary or arising after the Closing Date and delivered
by BREED or a Domestic Subsidiary, as applicable, pursuant to Article IV or
Section 8.19 hereof, substantially in the form of Exhibit L hereto, as amended
supplemented or restated from time to time.
"LC Account Agreement" means the LC Account Agreement dated as of the date
hereof among the Borrowers and the Agent substantially in the form of Exhibit M
hereto, as amended, supplemented or restated from time to time.
"Lease Assignments" means, collectively, Assignment of Lessee's Interest in
Leases assigning to the Agent each facility lease of BREED and any Domestic
Subsidiary heretofore entered into or entered into after the Closing Date and
delivered by BREED or a Domestic Subsidiary pursuant to Article IV or Section
8.19 hereof to collaterally secure the Borrowers' Obligations and the
Guarantors' Obligations under the Guaranty, substantially in the form of Exhibit
N hereto, as amended, supplemented or restated from time to time.
"Letter of Credit" means a standby letter of credit issued by the Issuing
Bank for the account of a Borrower in favor of a Person advancing credit or
securing an obligation on behalf of a Borrower.
"Letter of Credit Commitment" means, with respect to each Lender, the
obligation of such Lender to acquire Participations in respect of Letters of
Credit and Reimbursement Obligations up to an aggregate amount at any one time
outstanding equal to such Lender's Applicable Commitment Percentage of the Total
Letter of Credit Commitment as the same may be increased or decreased from time
to time pursuant to this Agreement.
"Letter of Credit Facility" means the facility described in Article III
hereof providing for the issuance by the Issuing Bank for the account of one or
more of the Borrowers of Letters of Credit in an aggregate stated amount at any
time outstanding not exceeding the Total Letter of Credit Commitment.
"Letter of Credit Outstandings" means, as of any date of determination, the
aggregate amount remaining undrawn under all Letters of Credit plus
Reimbursement Obligations then outstanding.
"Lien" means any interest in property securing any obligation owed to, or a
claim by, a Person other than the owner of the property, whether such interest
is based on the common law, statute or contract, and including but not limited
to the lien or security interest arising from a mortgage, encumbrance, pledge,
security agreement, conditional sale or trust receipt or a lease, consignment or
bailment for security purposes. For the purposes of this Agreement, BREED and
any Subsidiary shall be deemed to be the owner of any property which it has
acquired or holds subject to a conditional sale agreement, financing lease, or
other arrangement pursuant to which title to the property has been retained by
or vested in some other Person for security purposes.
"Loan" means any of the Revolving Loans or the Term Loan made under the
Revolving Credit Facility or the Term Loan Facility, respectively.
"Loan Documents" means this Agreement, the Notes, the Guaranties, the
Security Instruments, the Applications and Agreements for Letter of Credit, and
all other instruments and documents heretofore or hereafter executed or
delivered to or in favor of any Lender or the Agent in connection with the Loans
made and
transactions contemplated under this Agreement, as the same may be amended,
supplemented or restated from time to time.
"Loan Parties" means the Borrowers, the Guarantors and any other Person
(other than the Lenders) party to any of the Loan Documents.
"Managers" means collectively (or individually as the context may
indicate), Xxxxxxx X. Xxxxxxxxxxx, Xx., Xxxx X. Xxxxxx, and Xxxxxx X. Xxxxxx.
"Material Adverse Effect" means a material adverse effect on (i) the
business, properties, operations or condition, financial or otherwise, of BREED
and its Subsidiaries, taken as a whole, (ii) the ability of the Loan Parties
taken as a whole to pay or perform the obligations, liabilities and indebtedness
under the Loan Documents as such payment or performance becomes due in
accordance with the terms thereof, or (iii) the rights, powers and remedies of
the Agent or any Lender under any Loan Document or the validity, legality or
enforceability thereof.
"Material Contract" means any contract or agreement, written or oral, of
any Borrower or any of its Subsidiaries the failure to comply with which could
reasonably be expected to have a Material Adverse Effect.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgaged Property" means, collectively (or individually as the context
may indicate) the real property and improvements thereon described in the
Mortgages.
"Mortgages" means, collectively (or individually as the context may
indicate), each Credit-Line Deed of Trust, Mortgage, Open-End Mortgage, Deed of
Trust, Deed to Secure Debt, Leasehold Mortgage, Open-End Leasehold Mortgage,
Leasehold Deed of Trust, Leasehold Deed to Secure Debt, Security Agreement,
Fixture Financing Statement, Assignment of Leases and Rents and Financing
Statement or similar mortgage instrument of BREED and its Subsidiaries now or
hereafter entered into in connection with this Agreement to secure the
Obligations or the Guarantors' Obligations, such term to include the Collateral
Assignment of Rents and Leases executed by a Subsidiary of BREED, BTI Michigan,
Inc., to secure its obligations under its Guaranty, and as from time to time
amended, supplemented or restated.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which BREED or any ERISA Affiliate is making, or is
accruing an obligation to make, contributions or has made, or been obligated to
make, contributions within the preceding six (6) Fiscal Years.
"Municipal Obligations" means general obligations issued by, and supported
by the full taxing authority of, any state of the United States of America or of
any municipal corporation or other public body organized under the laws of any
such state which are rated in the highest investment rating category by both S&P
and Moody's.
"NationsBank" means NationsBank, National Association and its successors.
"NMSI" means NationsBanc Xxxxxxxxxx Securities, Inc. and its successors.
"Net Proceeds" means (a) from any Equity Offering or Debt Offering cash
payments received by BREED or any Subsidiary therefrom as and when received, net
of all legal, accounting, banking and underwriting fees and expenses,
commissions, discounts and other issuance expenses incurred in connection
therewith and all taxes required to be paid or accrued as a consequence of such
issuance and (b) from any Asset Disposition cash payments received by BREED or
any Subsidiary therefrom (including any cash payments received pursuant to any
note or other debt security received in connection with any Asset Disposition)
as and when received, net of (i) all legal fees and expenses and other fees and
expenses paid to third parties and incurred in connection therewith, (ii) all
taxes required to be paid or accrued as a consequence of such sale, (iii)
amounts applied to repayment of Indebtedness (other than the Obligations)
secured by a Lien on the asset or property disposed, and (iv) any other
necessary costs incurred in connection with the sale.
"Notes" means, collectively, the Term Notes and the Revolving Notes
executed and delivered to the Lenders substantially in the form of Exhibit O-1
and O-2, respectively.
"Obligations" means the obligations, liabilities and Indebtedness of the
Borrowers or any of them with respect to (i) the principal and interest on the
Loans as evidenced by the Notes, (ii) the Reimbursement Obligations and
otherwise in respect of the Letters of Credit, (iii) all liabilities of the
Borrowers or any of them to any Lender which arise under a Swap Agreement, and
(iii) the payment and performance of all other obligations, liabilities and
Indebtedness of the Borrowers or any of them to the Lenders, the Agent or NMSI
hereunder, under any one or more of the other Loan Documents or with respect to
the Loans.
"Offering Memorandum" means the offering memorandum prepared in connection
with the issuance of the Convertible Preferred Securities.
"Operating Documents" means with respect to any corporation, limited
liability company, partnership, limited partnership, limited liability
partnership, or other legally authorized incorporated or unincorporated entity,
the bylaws, operating agreement, partnership agreement, limited partnership
agreement or other applicable documents relating to the operation, governance or
management of such entity.
"Operating Plan" means the five (5) year consolidated business plan of
BREED and its Subsidiaries prepared by the management of BREED, giving effect to
the Allied Acquisition, which plan (a) is to include (i) proforma projected
balance sheets, statements of income and statements of cash flow (to include
separate forecasts for Consolidated Capital Expenditures and Consolidated EBITDA
by each major line of business) on a quarterly basis for the forthcoming Fiscal
Year and on an annual basis for the next succeeding four Fiscal Years, (ii)
detailed descriptions of all underlying assumptions, projected cost savings,
expense reductions, and synergies realized from the Allied Acquisition, (iii)
detailed descriptions of the long range plan for each major Subsidiary and for
operations which have been or will be discontinued and (iv) such other
calculations and descriptions as the Agent shall reasonably request, and (b)
shall otherwise be reasonably acceptable to the Agent; provided, that the
portion of the Operating Plan related to discontinued operations and
restructuring charges shall have been reviewed by Ernst & Young, LLP and the
five (5) year statements referred to in item (a)(i) above shall have been
prepared by the Borrower in accordance with procedures agreed upon with Ernst &
Young, LLP the compliance with and accuracy of which shall have tested for
conformity with such procedures by Ernst & Young, LLP.
"Organizational Action" means with respect to any corporation, limited
liability company, partnership,
limited partnership, limited liability partnership or other legally
authorized incorporated or unincorporated entity, any corporate, organizational,
partnership action (including any required stakeholder, member or partner
action) or other similar official action, as applicable, taken by such entity.
"Organizational Documents" means with respect to any corporation, limited
liability company, partnership, limited partnership, limited liability
partnership or other legally authorized incorporated or unincorporated entity,
the articles of incorporation, certificate of incorporation, articles of
organization, certificate of limited partnership or other applicable
organizational or charter documents relating to the creation of such entity.
"Outstandings" means, collectively, at any date, the Letter of Credit
Outstandings, the Revolving Credit Outstandings, and the Term Loan Outstandings
on such date.
"Participation" means, with respect to any Lender (other than the Issuing
Bank) and a Letter of Credit, the extension of credit represented by the
participation of such Lender hereunder in the liability of the Issuing Bank in
respect of a Letter of Credit and any Reimbursement Obligation arising with
respect thereto issued by the Issuing Bank in accordance with the terms hereof.
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
thereto.
"Pension Plan" means any employee pension benefit plan within the meaning
of Section 3(2) of ERISA, other than a Multiemployer Plan, which is subject to
the provisions of Title IV of ERISA or Section 412 of the Code and which (i) is
maintained for employees of BREED or any of its ERISA Affiliates or is assumed
by BREED or any of its ERISA Affiliates in connection with any Acquisition or
(ii) has at any time been maintained for the employees of BREED or any current
or former ERISA Affiliate.
"Permitted Indebtedness" has the meaning assigned to such term in Section
9.4 hereof.
"Permitted Liens" has the meaning assigned to such term in Section 9.3
hereof.
"Person" means an individual, partnership, corporation, trust, limited
liability company, unincorporated organization, association, joint venture or a
government or agency or political subdivision thereof.
"Pledge Agreement" means , collectively or individually as the context may
indicate (i) that certain Stock Pledge Agreement dated as of the Closing Date
between BREED and the Agent substantially in the form of Exhibit P-1 hereto,
(ii) that certain Stock Pledge Agreement dated as of the Closing Date between
certain Domestic Subsidiaries and the Agent substantially in the form of Exhibit
P-2 hereto, (iii) that certain Stock Pledge Agreement dated as of the Closing
Date among Xxxxx X. Breed, Xxxxxxx X. Breed, A. Breed, Ltd., a Texas limited
partnership, J. Breed, Ltd., a Texas limited partnership and the Agent
substantially in the form of Exhibit P-3 hereto, (iv) any Pledge Agreement,
Share Charge, Debenture or similar instrument whereby a Borrower or Domestic
Subsidiary creates a security interest in favor of the Agent of not less than
65% of the outstanding capital stock of a Direct Foreign Subsidiary, and (v) any
additional Pledge Agreement delivered to the Agent pursuant to Section 8.19, as
any of the foregoing may be hereafter amended, supplemented or restated from
time to time.
"Pledged Stock" has the meaning given to such term in any Pledge Agreement.
"Pounds Sterling" means the official currency of the United Kingdom.
"Pre-Refunded Municipal Obligations" means obligations of any state of the
United States of America or of any municipal corporation or other public body
organized under the laws of any such state which are rated, based on the escrow,
in the highest investment rating category by both S&P and Moody's and which have
been irrevocably called for redemption and advance refunded through the deposit
in escrow of Government Securities or other debt securities which are (i) not
callable at the option of the issuer thereof prior to maturity, (ii) irrevocably
pledged solely to the payment of all principal and interest on such obligations
as the same becomes due, and (iii) in a principal amount and bear such rate or
rates of interest as shall be sufficient to pay in full all principal of,
interest, and premium, if any, on such obligations as the same becomes due as
verified by a nationally recognized firm of certified public accountants.
"Prime Rate" means the per annum rate of interest established from time to
time by NationsBank as its prime rate, which rate may not be the lowest rate of
interest charged by NationsBank to its customers.
"Principal Office" means the principal office of NationsBank, presently
located at, Xxxxxxxxxxxx Xxxxxx, 00xx Xxxxx, XX0 000-00-00, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, Attention: Agency Services.
"Prudential" means Prudential Securities Credit Corp.
"Prudential Stock Purchase" means the purchase by Prudential of the Series
B Preference Shares pursuant to the Prudential Stock Purchase Agreement.
"Prudential Stock Purchase Agreement" means that certain Preferred Stock
Purchase Agreement dated as of October 30, 1997 between Prudential and BREED,
pursuant to which Prudential has agreed to purchase 4,000,000 shares of Series B
Preference Shares of BREED for an aggregate purchase price of $200,000,000.
"Prudential Stock Purchase Documents" means the Prudential Stock Purchase
Agreement, the Certificate of Designation (as defined in the Prudential Stock
Purchase Agreement) and all registration rights agreements, opinions and other
material principal documents entered into in connection with the transaction
contemplated thereby.
"Rate Hedging Obligations" means any and all obligations of BREED or any
Subsidiary, whether absolute or contingent and howsoever and whensoever created,
arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all
agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, Dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts, warrants and those commonly known as
interest rate "swap" agreements; and (ii) any and all cancellations, buybacks,
reversals, terminations or assignments of any of the foregoing.
"Regulation D" means Regulation D of the Board as the same may be amended
or supplemented from
time to time.
"Reimbursement Obligation" shall mean at any time, the obligation of one or
more of the Borrowers with respect to any Letter of Credit to reimburse the
Issuing Bank and the Lenders to the extent of their respective Participations
(including by the receipt by the Issuing Bank of proceeds of Loans pursuant to
Section 3.2) for amounts theretofore paid by the Issuing Bank pursuant to a
drawing under such Letter of Credit.
"Repurchase Agreement" means a repurchase agreement entered into with any
financial institution whose debt obligations or commercial paper are rated "A"
by either of S&P or Moody's or "A-1" by S&P or "P- 1" by Moody's.
"Required Lenders" means, as of any date, Lenders on such date having
Credit Exposures (as defined below) aggregating in excess of 50% of the
aggregate Credit Exposures of all Lenders on such date; provided, however, that
to the extent NationsBank has more than fifty percent (50%) of the aggregate
Credit Exposures, Required Lenders means Lenders on such date having Credit
Exposures of 66 2/3% of the aggregate Credit Exposures of all Lenders. For
purposes of the preceding sentence, the amount of the "Credit Exposure" of each
Lender shall be equal to the aggregate principal amount of the Revolving Loans
owing to such Lender plus the aggregate unutilized amounts of such Lender's
Revolving Credit Commitment plus the amount of such Lender's Applicable
Commitment Percentage of Letter of Credit Outstandings plus the amount of such
Lender's Applicable Commitment Percentage of the Term Loan Outstandings;
provided that, (i) if any Lender with a Revolving Credit Commitment shall have
failed to pay to the Issuing Bank its Applicable Commitment Percentage of any
drawing under any Letter of Credit resulting in an outstanding Reimbursement
Obligation, such Lender's Credit Exposure attributable to Letters of Credit and
Reimbursement Obligations shall be deemed to be held by the Issuing Bank for
purposes of this definition.
"Reserve Requirement" means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against in the case of
Eurodollar Rate Loans, "Eurocurrency liabilities" (as such term is used in
Regulation D). Without limiting the effect of the foregoing, the Reserve
Requirement shall reflect any other reserves required to be maintained by such
member banks with respect to (i) any category of liabilities which includes
deposits by reference to which the Eurodollar Rate is to be determined, or (ii)
any category of extensions of credit or other assets which include Eurodollar
Rate Loans. The Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
"Restricted Payment" means (a) any dividend or other distribution, direct
or indirect, on account of any shares of any class of stock or equity securities
of BREED (including the Convertible Debentures) or any of its Subsidiaries
(other than those payable or distributable solely to BREED or by a Subsidiary to
its parent) now or hereafter outstanding, except a dividend payable solely in
shares of a class of stock to the holders of that class; (b) any redemption,
conversion, exchange, retirement or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of stock
of BREED or any of its Subsidiaries or other equity securities of BREED (other
than those payable or distributable solely to BREED) now or hereafter
outstanding; (c) any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any class of
stock of BREED or any of its Subsidiaries or other equity securities of BREED
now or hereafter outstanding; and (d) any issuance and sale of capital
stock of any Subsidiary of BREED (or any option, warrant or right to acquire
such stock or other equity securities of BREED) other than to BREED or a
Domestic Subsidiary or Guarantor.
"Revolving Credit Commitment" means, with respect to each Lender, the
obligation of such Lender to make Revolving Loans to the Borrowers up to an
aggregate principal amount at any one time outstanding equal to such Lender's
Applicable Commitment Percentage of the Total Revolving Credit Commitment.
"Revolving Credit Facility" means the facility described in Section 2.1(a)
hereof providing for Loans to the Borrowers by the Lenders in the aggregate
principal amount of the Total Revolving Credit Commitment.
"Revolving Credit Outstandings" means, as of any date of determination, the
aggregate principal amount of all Revolving Loans then outstanding and all
interest accrued thereon.
"Revolving Credit Termination Date" means (i) the Stated Termination Date
or (ii) such earlier date of termination of Lenders' obligations pursuant to
Section 10.1 upon the occurrence of an Event of Default, or (iii) such date as
the Borrowers may voluntarily and permanently terminate the Revolving Credit
Facility by payment in full of all Revolving Credit Outstandings and Letter of
Credit Outstandings, termination of the Revolving Credit Commitment and the
Letter of Credit Commitment and cancellation (or, pursuant to the terms of the
LC Account Agreement, the cash collateralization) of all Letters of Credit.
"Revolving Loan" means any borrowing pursuant to an Advance under the
Revolving Credit Facility.
"Revolving Notes" means, collectively, the promissory notes of the
Borrowers evidencing Revolving Loans executed and delivered to the Lenders as
provided in Section 2.5(b) substantially in the form of Exhibit O-1, with
appropriate insertions as to amounts, dates, and names of Lenders.
"S&P" means Standard & Poor's Ratings Group, a division of The XxXxxx-Xxxx
Companies, Inc.
"Security Agreement" means, collectively (or individually as the context
may indicate), (i) the Security Agreement dated as of the date hereof among
Borrowers, the Guarantors and the Agent, and (ii) any additional Security
Agreement delivered to the Agent pursuant to Section 8.19(a) hereof, in each
case, substantially in the form attached hereto as Exhibit R, as such Security
Agreement may be amended, supplemented or restated from time to time.
"Security Instruments" means the Security Agreement, the Intellectual
Property Security Agreement, the Pledge Agreement, the Collateral Assignment of
Partnership Interests, the Collateral Assignment of Trademark License Agreement,
the Mortgages, the Intercompany Note Pledge Agreement, the Lease Assignments,
the Landlord Waivers, the Intellectual Property Assignment, the Intercompany
Note Subordination Agreement, the LC Account Agreement and all other documents
and agreements executed and delivered in connection herewith granting to the
Lenders Liens on any assets of the Borrowers, any Guarantor, or any other Person
collaterally to secure payment and performance of the Obligations and the
Guarantors' Obligations under the Guaranty.
"Segment" means a portion of the Term Loan (or all thereof) with respect to
which a particular interest rate is (or is proposed to be) applicable.
"Series A Preference Shares" means BREED's 1997 Series A Convertible
Non-Voting Preferred Shares, par value $.001 per share.
"Series B Preference Shares" means BREED's 1997 Series B Convertible
Preferred Stock, par value $.001 per share.
"Siemens" means Siemens Aktiengesell-Schaft, a German company.
"Siemens Stock Purchase" means the purchase by Siemens of the Series A
Preference Shares pursuant to the Siemens Stock Purchase Agreement.
"Siemens Stock Purchase Agreement" means that certain Stock Purchase
Agreement dated as of October 14, 1997 between Siemens and BREED, pursuant to
which Siemens has agreed to purchase 4,883,227 shares of Series A Preference
Shares of BREED for an aggregate purchase price of $115,000,000.
"Siemens Stock Purchase Documents" means the Siemens Stock Purchase
Agreement and all shareholder agreements, make-whole agreements, registration
rights agreements, opinions and other material principal documents entered into
in connection with the transaction contemplated thereby.
"Single Employer Plan" means any employee pension benefit plan covered by
Title IV of ERISA in respect of which BREED or any Subsidiary is an "employer"
as described in Section 4001(b) of ERISA and which is not a Multiemployer Plan.
"Solvent" means, when used with respect to any Person, that at the time of
determination:
(i) the fair value of its assets (both at fair valuation and at present
fair saleable value on an orderly basis) is in excess of the total amount of its
liabilities, including Contingent Obligations; and
(ii) it is then able and expects to be able to pay its debts as they
mature; and
(iii) it has capital sufficient to carry on its business as conducted and
as proposed to be conducted.
"Spanish Pesetas" means the official currency of Spain.
"Spot Rate of Exchange" means (i) in determining the Dollar Equivalent
Amount of a specified Alternative Currency amount as of any date, the spot
exchange rate determined by the Agent in accordance with its usual procedures
for the purchase by the Agent of Dollars with such Alternative Currency at
approximately 10:00 A.M. on the Business Day that is two (2) Business Days prior
to such date, and (ii) in determining the Alternative Currency Equivalent Amount
of a specified Dollar amount on any date, the spot exchange rate determined by
the Agent in accordance with its usual procedures for the purchase by the Agent
of such Alternative Currency with Dollars at approximately 10:00 A.M. on the
Business Day that is two (2) Business Days prior to such date.
"Stated Termination Date" means October 31, 1998.
"Stock Option Plans" means, collectively, the BREED Technologies, Inc. 1992
Stock Option Plan, the BREED Technologies, Inc 1992 Director Stock Option Plan,
the BREED Technologies, Inc 1992 Employee Stock Purchase Plan and the BREED
Technologies, Inc 1994 Stock Incentive Plan.
"Subordinated Indebtedness" means all Indebtedness that is subordinated to
the Revolving Credit Facility under its own terms or under any separate
agreement of subordination, in each case upon terms satisfactory to the Agent.
"Subsidiary" means any corporation or other entity in which 50% or more of
its outstanding voting stock or 50% or more of all equity interests is owned
directly or indirectly by BREED and/or by one or more of BREED's Subsidiaries or
is otherwise required under GAAP to have its financial statements consolidated
with those of BREED and its Subsidiaries.
"Swap Agreement" means one or more agreements between the Borrowers and any
Lender with respect to Indebtedness evidenced by any or all of the Notes, on
terms mutually acceptable to Borrowers and such Lender, which agreements create
Rate Hedging Obligations.
"Term Loan" means the loan made pursuant to the Term Loan Facility.
"Term Loan Commitment" means, with respect to each Lender, the obligation
of such Lender to make the Term Loan to BREED in a principal amount equal to
such Lender's Applicable Commitment Percentage of the Total Term Loan
Commitment.
"Term Loan Facility" means the facility described in Section 2.1(b)
providing for a Term Loan to BREED by the Lenders in the original principal
amount of the Total Term Loan Commitment.
"Term Loan Outstandings" means, as of any date of determination, the
aggregate principal amount of the Term Loan then outstanding and all interest
accrued thereon.
"Term Loan Termination Date" means (i) the Stated Termination Date or (ii)
such earlier date of termination of Lenders' obligations pursuant to Section
10.1 upon the occurrence of an Event of Default, or (iii) such date as BREED may
voluntarily and permanently terminate the Term Loan Facility by payment in full
of all Obligations incurred in connection with the Term Loan.
"Term Notes" means, collectively, the promissory notes of BREED evidencing
Term Loans executed and delivered to the Lenders as provided in Section 2.5(a)
substantially in the form of Exhibit O-2, with appropriate insertions as to
amounts, dates and names of Lenders.
"Termination Event" means: (i) a "Reportable Event" described in Section
4043 of ERISA and the regulations issued thereunder (unless the notice
requirement has been waived by applicable regulation); or (ii) the withdrawal of
BREED or any ERISA Affiliate from a Pension Plan during a plan year in which it
was a "substantial employer" as defined in Section 4001(a)(2) of ERISA or was
deemed such under Section 4068(f) of ERISA; or (iii) the termination of a
Pension Plan, the filing of a notice of intent to terminate a Pension Plan or
the treatment of a Pension Plan amendment as a termination under Section 4041 of
ERISA; or (iv) the institution of proceedings to terminate a Pension Plan by the
PBGC; or (v) any other event or condition which
would constitute grounds under Section 4042(a) of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan; or (vi) the
partial or complete withdrawal of BREED or any ERISA Affiliate from a
Multiemployer Plan; or (vii) the imposition of a Lien pursuant to Section 412 of
the Code or Section 302 of ERISA; or (viii) any event or condition which results
in the reorganization or insolvency of a Multiemployer Plan under Section 4241
or Section 4245 of ERISA, respectively; or (ix) any event or condition which
results in the termination of a Multiemployer Plan under Section 4041A of ERISA
or the institution by the PBGC of proceedings to terminate a Multiemployer Plan
under Section 4042 of ERISA; or (x) any event or condition with respect to any
Employee Benefit Plan which is regulated by any Foreign Benefit Law that results
in such Employee Benefit Plan's termination or the revocation of the Employee
Benefit Plan's authority to operate under the applicable Foreign Benefit Law.
"Total Alternative Currency Sublimit" means $75,000,000.
"Total Credit Commitment" means a principal amount equal to the Total
Revolving Credit Commitment plus the Total Term Loan Commitment.
"Total Letter of Credit Commitment" means an amount not to exceed
$25,000,000.
"Total Revolving Credit Commitment" means a principal amount equal to
$300,000,000, as reduced from time to time in accordance with Section 2.7.
"Total Term Loan Commitment" means a principal amount equal to
$600,000,000.
"Type" shall mean any type of Loan (i.e., a Base Rate Loan or a Eurodollar
Rate Loan).
"Voting Stock" means shares of capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for the election of directors
(or persons performing similar functions) of such Person, even if the right so
to vote has been suspended by the happening of such a contingency.
1.2. Rules of Interpretation. (a) All accounting terms not specifically
defined herein shall have the meanings assigned to such terms and shall be
interpreted in accordance with GAAP applied on a Consistent Basis.
(b) Each term defined in Article 1 or 9 of the Florida Uniform Commercial
Code shall have the meaning given therein unless otherwise defined herein,
except to the extent that the Uniform Commercial Code of another jurisdiction is
controlling, in which case such terms shall have the meaning given in the
Uniform Commercial Code of the applicable jurisdiction.
(c) The headings, subheadings and table of contents used herein or in any
other Loan Document are solely for convenience of reference and shall not
constitute a part of any such document or affect the meaning, construction or
effect of any provision thereof.
(d) Except as otherwise expressly provided, references herein to articles,
sections, paragraphs, clauses, annexes, appendices, exhibits and schedules are
references to articles, sections, paragraphs, clauses,
annexes, appendices, exhibits and schedules in or to this Agreement.
(e) All definitions set forth herein or in any other Loan Document shall
apply to the singular as well as the plural form of such defined term, and all
references to the masculine gender shall include reference to the feminine or
neuter gender, and vice versa, as the context may require.
(f) When used herein or in any other Loan Document, words such as
"hereunder", "hereto", "hereof" and "herein" and other words of like import
shall, unless the context clearly indicates to the contrary, refer to the whole
of the applicable document and not to any particular article, section,
subsection, paragraph or clause thereof.
(g) References to "including" means including without limiting the
generality of any description preceding such term, and for purposes hereof the
rule of ejusdem generis shall not be applicable to limit a general statement,
followed by or referable to an enumeration of specific matters, to matters
similar to those specifically mentioned.
(h) All dates and times of day specified herein shall refer to such dates
and times at Charlotte, North Carolina.
(i) Each of the parties to the Loan Documents and their counsel have
reviewed and revised, or requested (or had the opportunity to request) revisions
to, the Loan Documents, and any rule of construction that ambiguities are to be
resolved against the drafting party shall be inapplicable in the construing and
interpretation of the Loan Documents and all exhibits, schedules and appendices
thereto.
(j) Any reference to an officer of BREED or any other Person by reference
to the title of such officer shall be deemed to refer to each other officer of
such Person, however titled, exercising the same or substantially similar
functions.
(k) All references to any agreement or document as amended, modified or
supplemented, or words of similar effect, shall mean such document or agreement,
as the case may be, as amended, modified or supplemented from time to time only
as and to the extent permitted therein and in the Loan Documents.
ARTICLE II
The Credit Facilities
2.1. Loans.
(a) Revolving Loan. Subject to the terms and conditions of this Agreement,
each Lender severally agrees to make Advances in Dollars or an Alternative
Currency (as specified in the respective Borrowing Notice) to the applicable
Borrower or Borrowers under the Revolving Credit Facility from time to time from
the Closing Date until the Revolving Credit Termination Date on a pro rata basis
as to the total borrowing requested by the applicable Borrower or Borrowers on
any day determined by such Lender's Applicable Commitment Percentage up to but
not exceeding a Dollar Value equal to the Revolving Credit Commitment of such
Lender, provided, however, that the Lenders will not be required and shall have
no obligation to make any such
Advance (i) so long as a Default or an Event of Default has occurred and is
continuing or (ii) if the Agent has accelerated the maturity of any of the Notes
as a result of an Event of Default; provided further, however, that immediately
after giving effect to each such Advance, (u) the Dollar Value of the principal
amount of Revolving Credit Outstandings plus Letter of Credit Outstandings shall
not exceed the Total Revolving Credit Commitment and (v) the Dollar Value of the
principal amount of Loans in an Alternative Currency shall not exceed the Total
Alternative Currency Sublimit. Within such limits, the Borrowers may borrow,
repay and reborrow under the Revolving Credit Facility on a Business Day from
the Closing Date until, but (as to borrowings and reborrowings) not including,
the Revolving Credit Termination Date; provided, however, that (w) no Eurodollar
Rate Loan shall be made which has an Interest Period that extends beyond the
Stated Termination Date and (x) each Eurodollar Rate Loan may, subject to the
provisions of Section 2.7, be repaid only on the last day of the Interest Period
with respect thereto unless such payment is accompanied by the additional
payment, if any, required by Section 5.5. The Borrowers agree that (y) if at any
time the Dollar Value of Revolving Credit Outstandings plus the Dollar Value of
Letter of Credit Outstandings shall exceed the Total Revolving Credit
Commitment, the Borrowers shall immediately reduce the outstanding principal
amount of the Revolving Loans such that, as a result of such reduction, the
Dollar Value of Revolving Credit Outstandings plus the Dollar Value of Letter of
Credit Outstandings shall not exceed the Total Revolving Credit Commitment and
(z) if at any time the Dollar Value of Loans in an Alternative Currency exceed
the Total Alternative Currency Sublimit by 105%, the Borrowers shall immediately
make a Rate Adjustment Payment as set forth below in Section 2.1(c).
(b) Term Loan. Subject to the terms and conditions of this Agreement, each
Lender severally agrees to make an Advance of the Term Loan in Dollars (as
specified in the Borrowing Notice) to BREED under the Term Loan Facility on the
Closing Date on a pro rata basis determined by its Applicable Commitment
Percentage up to the Term Loan Commitment of such Lender. The Term Loan shall be
available in a single draw on the Closing Date and shall be due and payable on
the Stated Termination Date. The principal amount of each Segment of the Term
Loan outstanding hereunder from time to time shall bear interest, at BREED's
election, at an interest rate per annum equal to the Base Rate or the Eurodollar
Rate; provided, that (x) no Eurodollar Rate Segment shall have an Interest
Period that extends beyond the Stated Termination Date, and (y) each Eurodollar
Rate Segment may, subject to the provisions of Section 2.7, be repaid only on
the last day of the Interest Period with respect thereto unless such payment is
accompanied by the additional payment, if any, required by Section 5.5. BREED
agrees that if at any time the Term Loan Outstandings shall exceed the Total
Term Loan Commitment, the Borrowers shall immediately reduce the outstanding
principal amount of the Term Loans such that, as a result of such reduction, the
Term Loan Outstandings shall not exceed the Total Term Loan Commitment.
(c) Amounts. (i) Each request for an Advance in an Alternative Currency
under a Borrowing Notice shall constitute the applicable Borrower's or
Borrowers' request for a Loan of the Dollar Value of the amount of the
Alternative Currency specified in such Borrowing Notice and for such Loan to be
made available by the Lenders to the applicable Borrower or Borrowers in the
Alternative Currency Equivalent Amount of such Dollar Value (determined based on
the Advance Date Exchange Rate applicable to such Advance). The principal amount
outstanding on any Loan shall be recorded in the Agent's records in Dollars (in
the case of an Advance in an Alternative Currency as if the Loan had initially
been made in Dollars), based on the amount of any Loan in Dollars and on the
Dollar Value of the initial Advance in an Alternative Currency, as reduced from
time to time by the Dollar Equivalent Amount (based on the Advance Date Exchange
Rate applicable to such Advance) of any principal payments with respect to such
Advance. Loans in an Alternative Currency shall be
limited to Revolving Loans which are Eurodollar Rate Loans. The Term Loan
shall at all times be in Dollars.
In the event a Eurodollar Rate Loan of an Alternative Currency is
Continued, such election to Continue the Eurodollar Rate Loan shall be treated
as an Advance and the Agent shall notify the applicable Borrower or Borrowers
and the Lenders of the Advance Date Exchange Rate, Interest Period and the
Eurodollar Rate for such Continued Eurodollar Rate Loan. In such event, the
Lenders shall each be deemed to have made an Advance to the applicable Borrower
or Borrowers of its Applicable Commitment Percentage of such Loan of an
Alternative Currency and the Agent shall apply the Advance Date Exchange Rate
for such new Interest Period to such Continued Alternative Currency Equivalent
Amount to determine the new Dollar Value of such Eurodollar Rate Loan and shall
adjust its books and the Outstandings. In the event that such adjustment with
respect to a Continued Loan would cause the total Dollar Value of Revolving
Credit Outstandings plus the Dollar Value of Letter of Credit Outstandings to
exceed the Total Revolving Credit Commitment or the total Dollar Value of all
Loans in an Alternative Currency to exceed the Total Alternative Currency
Sublimit by 105%, the Borrowers shall, immediately on the effective date of such
Continuation, repay (a "Rate Adjustment Payment") the portion of such Continued
Loan (applying the new Advance Date Exchange Rate) necessary to ensure that the
total Dollar Value of all Revolving Credit Outstandings plus the Dollar Value of
Letter of Credit Outstandings does not exceed the Total Revolving Credit
Commitment and the total Dollar Value of Loans in an Alternative Currency does
not exceed the Total Alternative Currency Sublimit by 105%. Such Rate Adjustment
Payments shall be accompanied by payment of all amounts due pursuant to Section
5.5 hereof as a result of such Rate Adjustment Payment. For the purposes of
determining the maximum amount of Revolving Credit Outstandings and Letter of
Credit Outstandings and compliance with the Total Alternative Currency Sublimit
hereunder, it is intended by the parties that all Loans shall be the functional
equivalent of Loans made and repaid (based on the applicable Advance Date
Exchange Rate for each Advance) in Dollars. It is recognized that one or more
Lenders may elect to record Loans in Alternative Currencies. The Agent shall
maintain records sufficient to identify at any time, (A) the Advance Date
Exchange Rate with respect to each Advance and (B) the portion of the Revolving
Credit Outstandings attributable to each Advance.
(ii) The aggregate unpaid principal amount (including with respect to Loans
of Alternative Currencies the total Dollar Value) of (A) the Revolving Credit
Outstandings plus Letter of Credit Outstandings shall not exceed at any time the
Total Revolving Credit Commitment, (B) the Term Loan Outstandings shall not
exceed at any time the Total Term Loan Commitment, and (C) Loans in an
Alternative Currencies shall not exceed the Total Alternative Currency Sublimit
by 105%, and, in the event there shall be outstanding any such excess in any of
the foregoing instances, the Borrowers shall immediately make such payments and
prepayments as shall be necessary to comply with this restriction. Each Loan
hereunder, other than Base Rate Refunding Loans, and each Conversion under
Section 2.8, shall be (A) in the case of Loans made in Dollars, in an amount of
at least $5,000,000, and, if greater than $5,000,000, an integral multiple of
$1,000,000, and (B) in the case of Loans made in an Alternative Currency, in an
amount of at least $5,000,000 (or the Alternative Currency Equivalent Amount
thereof), and, if greater than $5,000,000, an integral multiple of $1,000,000
(or the Alternative Currency Equivalent Amount thereof).
(d) Advances and Rate Selection. (i) An Authorized Representative shall
give the Agent (A) at least three (3) Business Days' irrevocable written notice
by telefacsimile transmission of a Borrowing Notice or Interest Rate Selection
Notice (as applicable) with appropriate insertions, effective upon receipt, of
each Eurodollar Rate Loan (whether representing an additional borrowing
hereunder or the Conversion of a borrowing hereunder) prior to 11:00 A.M. and
(B) irrevocable written notice by telefacsimile transmission of a
Borrowing Notice or Interest Rate Selection Notice (as applicable) with
appropriate insertions, effective upon receipt, of each Loan (other than Base
Rate Refunding Loans to the extent the same are effected without notice pursuant
to Section 2.1(d)(iv)) that is a Base Rate Loan (whether representing an
additional borrowing hereunder or the Conversion of borrowing hereunder) prior
to 11:00 A.M. on the day of such proposed Base Rate Loan. Each such notice shall
specify the amount of the borrowing, whether Dollar or Alternative Currency (in
the case of a Revolving Loan), the Type of Loan (Base Rate or Eurodollar Rate),
the date of borrowing and, if a Eurodollar Rate Loan, the Interest Period to be
used in the computation of interest. Notice of receipt of such Borrowing Notice
or Interest Rate Selection Notice, as the case may be, together with the amount
of each Lender's portion of an Advance or Segment requested, Continued, or
Converted thereunder, shall be promptly provided by the Agent to each Lender by
telefacsimile transmission, but (provided the Agent shall have received such
notice by 11:00 A.M.) not later than 1:00 P.M. on the same day as the Agent's
receipt of such notice. At approximately 10:00 A.M. two (2) Business Days
preceding the date specified for an Advance, Continuation or Conversion of an
Alternative Currency, the Agent shall determine the Advance Date Exchange Rate
and the applicable Eurodollar Rate. Not later than 10:45 A.M. two (2) Business
Days preceding the date specified for each Advance, Continuation or Conversion
of an Alternative Currency, the Agent shall provide the applicable Borrower or
Borrowers and each Lender notice by telefacsimile transmission of the Advance
Date Exchange Rate applicable to such Advance, Continuation or Conversion and
the applicable Alternative Currency Equivalent Amount of the Revolving Loan or
Loans required to be made by each Lender on such date, and the Dollar Value of
such Revolving Loan or Loans and the applicable Eurodollar Rate.
(ii) (A) In the case of Advances in Dollars, not later than 2:00 P.M. on
the date specified for each borrowing under this Section 2.1, each Lender shall,
pursuant to the terms and subject to the conditions of this Agreement, make the
amount of the Advance or Advances to be made by it on such day available by wire
transfer to the Agent in the amount of its pro rata share, determined according
to such Lender's Applicable Commitment Percentage of the Loan or Loans to be
made on such day. Such wire transfer shall be directed to the Agent at the
Principal Office and shall be in the form of Dollars constituting immediately
available funds. The amount so received by the Agent shall, subject to the terms
and conditions of this Agreement, be made available to the applicable Borrower
or Borrowers by delivery of the proceeds thereof to the Borrowers' Account or
otherwise as shall be directed in the applicable Borrowing Notice by the
Authorized Representative and reasonably acceptable to the Agent.
(B) In the case of Advances of an Alternative Currency, not later than
10:00 A.M. on the date specified for each Advance, each Lender shall, pursuant
to the terms and subject to the conditions of this Agreement, make the amount of
the Revolving Loan or Loans to be made by it on such day available to the
applicable Borrower or Borrowers at the Funding Bank, to the account of the
Agent with the Funding Bank. The amount so received by the Funding Bank shall,
subject to the terms and conditions of the Loan Documents and upon instruction
from the Agent to the Funding Bank on the same day or immediately preceding day
but no later than 10:00 A.M., be made available to the applicable Borrower or
Borrowers by delivery of the Alternative Currency Equivalent Amount to the
Borrowers' account with the Funding Bank.
(iii) The Borrowers shall have the option to elect the duration of the
initial and any subsequent Interest Periods and to Continue or Convert the Loans
in accordance with Section 2.8. Eurodollar Rate Loans and Base Rate Loans may be
outstanding at the same time, provided, however, there shall not be outstanding
at any one time Eurodollar Rate Loans having more than ten (10) different
Interest Periods. If the Agent does not receive a Borrowing Notice or an
Interest Rate Selection Notice giving notice of election of the duration of an
Interest Period or of Conversion of any Loan to or Continuation of a Loan
as a Eurodollar Rate Loan by the time prescribed by Section 2.1(d) or 2.8, the
applicable Borrower or Borrowers shall be deemed to have elected to Convert such
Loans to (or continue such Loan as) a Base Rate Loan until the applicable
Borrower or Borrowers notifies the Agent in accordance with Section 2.8.
(iv) Notwithstanding the foregoing, if a drawing is made under any Letter
of Credit, such drawing is honored by the Issuing Bank prior to the Stated
Termination Date, and the applicable Borrower or Borrowers shall not immediately
fully reimburse the Issuing Bank in respect of such drawing, (A) provided that
the conditions to making a Revolving Loan as herein provided shall then be
satisfied, the Reimbursement Obligation arising from such drawing shall be paid
to the Issuing Bank by the Agent without the requirement of notice to or from
the applicable Borrower or Borrowers from immediately available funds which
shall be advanced as a Base Rate Refunding Loan by each Lender under the
Revolving Credit Facility in an amount equal to such Lender's Applicable
Commitment Percentage of such Reimbursement Obligation, and (B) if the
conditions to making a Revolving Loan as herein provided shall not then be
satisfied, each of the Lenders shall fund by payment to the Agent (for the
benefit of the Issuing Bank) in immediately available funds the purchase from
the Issuing Bank of their respective Participations in the related Reimbursement
Obligation based on their respective Applicable Commitment Percentages of the
Total Letter of Credit Commitment. If a drawing is presented under any Letter of
Credit in accordance with the terms thereof and the Borrowers shall not
immediately reimburse the Issuing Bank in respect thereof, then notice of such
drawing or payment shall be provided promptly by the Issuing Bank to the Agent
and the Agent shall promptly provide notice to each Lender by telephone or
telefacsimile transmission. If notice to the Lenders of a drawing under any
Letter of Credit is given by the Agent at or before 1:00 any Business Day, each
Lender shall, pursuant to the conditions specified in this Section 2.1(d)(iv),
either make a Base Rate Refunding Loan or fund the purchase of its Participation
in the amount of such Lender's Applicable Commitment Percentage of such drawing
or payment and shall pay such amount to the Agent for the account of the Issuing
Bank at the Principal Office in Dollars and in immediately available funds
before 2:00 P.M. on the same Business Day. If notice to the Lenders of a drawing
under a Letter of Credit is given by the Agent after 1:00 on any Business Day,
each Lender shall, pursuant to the conditions specified in this Section
2.1(d)(iv), either make a Base Rate Refunding Loan or fund the purchase of its
Participation in the amount of such Lender's Applicable Commitment Percentage of
such drawing or payment and shall pay such amount to the Agent for the account
of the Issuing Bank at the Principal Office in Dollars and in immediately
available funds before 12:00 noon on the next following Business Day. Any such
Base Rate Refunding Loan shall be advanced as, and shall continue as, a Base
Rate Loan unless and until the applicable Borrower or Borrowers Converts such
Base Rate Loan in accordance with the terms of Section 2.8.
(e) Notwithstanding any other provision of this Agreement, except as
hereinafter provided, each Borrower shall be jointly and severally liable as
primary obligor and not merely as surety for repayment of all Obligations
arising under the Loan Documents. Such joint and several liability shall apply
to each Borrower regardless of whether (i) any Loan was only requested by or
made to another Borrower or the proceeds of any Loan were used only by another
Borrower, (ii) any Letter of Credit was issued on the application of another
Borrower, (iii) any interest rate election was made only by another Borrower, or
(iv) any indemnification obligation or any other obligation arose only as a
result of the actions of another Borrower; provided the liability of each of the
Borrowers other than BREED under this Agreement, the Notes and the other Loan
Documents shall be limited to the maximum amount of the Obligations under the
Revolving Credit Facility for which such other Borrower may be liable without
violating any applicable fraudulent conveyance, fraudulent transfer or
comparable laws. Each Borrower shall retain any right of contribution arising
under applicable law against the
other Borrowers as the result of the satisfaction of any Obligations;
provided, no Borrower shall assert such right of contribution against any other
Borrower until the Obligations shall have been paid in full. Notwithstanding
anything herein to the contrary, a Borrowing Subsidiary which is a Foreign
Subsidiary shall be liable hereunder only for Advances, Loans and Reimbursement
Obligations made by it or on its behalf hereunder together with interest
relating thereto and fees and expenses arising hereunder.
Without limiting the foregoing provisions of this Section 2.1(e), each of
the Borrowers, other than a Borrowing Subsidiary which is a Foreign Subsidiary,
hereby irrevocably, absolutely and unconditionally guarantees the full and
punctual payment or performance when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise, of all
Obligations of each other Borrower whether owing to the Agent or any Lender.
This guarantee constitutes a guaranty of payment and not of collection. The
liability of each of the Borrowers other than BREED and a Borrowing Subsidiary
which is a Foreign Subsidiary under the immediately preceding two sentences
shall be limited to the maximum amount for which such Borrower may be liable
without violating any applicable fraudulent conveyance, fraudulent transfer or
comparable laws.
It is the intention of the parties that with respect to each Borrower its
obligations hereunder and under the other Loan Documents shall be absolute,
unconditional and irrevocable irrespective of:
(i) any lack of validity, legality or enforceability of this Agreement, any
Note, any other Loan Document as to any other Borrowers;
(ii) the failure of the Agent or any Lender:
(A) to enforce any right or remedy against any other Borrower or any other
Person under the provisions of this Agreement, any Note, any other Loan Document
or otherwise, or
(B) to exercise any right or remedy against any guarantor of, or collateral
securing, any Obligations;
(iii) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations, or any other extension, compromise
or renewal of any Obligations with respect to any other Borrower;
(iv) any reduction, limitation, impairment or termination of any
Obligations with respect to any other Borrower or any other Person for any
reason including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to (and each Borrower hereby waives any
right to or claim of) any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise or unenforceability of, or any other event or
occurrence affecting, any Obligations with respect to any other Borrower;
(v) any addition, exchange, release, surrender or nonperfection of any
collateral, or any amendment to or waiver or release or addition of, or consent
to departure from , any guaranty, held by the Agent, any Lender or any holder of
any Note securing any of the Obligations; or
(vi) any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, any other Borrower, any
surety or any guarantor.
Each Borrower (except Borrowing Subsidiaries which are Foreign
Subsidiaries) agrees that its joint and several liability hereunder shall
continue to be effective or be reinstated, as the case may be, if at any time
any payment (in whole or in part) of any of the Obligations is rescinded or must
be restored by the Agent, any Lender or any holder of any Note, upon the
insolvency, bankruptcy or reorganization of any other Borrower as though such
payment had not been made.
Each Borrower hereby expressly waives: (a) notice of the Lenders'
acceptance of this Agreement; (b) notice of the existence or creation or
non-payment of all or any of the Obligations; (c) presentment, demand, notice of
dishonor, protest, and all other notices whatsoever other than notices expressly
provided for in this Agreement or by applicable law and (d) all diligence in
collection or protection of or realization upon the Obligations or any thereof,
any obligation hereunder, or any security for or guaranty of any of the
foregoing.
No delay on any of the Lenders' or the Agent's part in the exercise of any
right or remedy shall operate as a waiver thereof, and no single or partial
exercise by any of the Lenders or the Agent of any right or remedy shall
preclude any other or further exercise thereof or the exercise of any other
right or remedy. No action of the Agent or any of the Lenders permitted
hereunder shall in any way affect or impair any of their rights or any of their
obligations to any of the Borrowers under this Agreement (except as otherwise
waived, modified, or amended).
2.2. Payment of Interest. (a) The applicable Borrower or Borrowers shall
pay interest to the Agent for the account of each Lender on the outstanding and
unpaid principal amount of each Loan made by such Lender for the period
commencing on the date of such Loan until such Loan shall be due (i) in the case
of Loans made in Dollars, at the then applicable Base Rate for Base Rate Loans
or applicable Eurodollar Rate for Eurodollar Rate Loans, as designated by the
Authorized Representative pursuant to Section 2.1, such payments to be made in
Dollars, and (ii) in the case of Loans made in Alternative Currencies, at the
applicable Eurodollar Rate, such payments to be made in the appropriate
Alternative Currency; provided, however, that if any amount shall not be paid
when due (at maturity, by acceleration or otherwise), all amounts outstanding
hereunder shall bear interest thereafter at the Default Rate.
(b) Interest on each Loan shall be computed on the basis of a year of 360
days and calculated in each case for the actual number of days elapsed. Interest
on each Loan shall be paid (i) quarterly in arrears on the last Business Day of
each March, June, September and December, commencing December 31, 1997 for each
Base Rate Loan, (ii) on the last day of the applicable Interest Period for each
Eurodollar Rate Loan and (iii) upon payment in full of the principal amount of
such Loan.
2.3. Payment of Principal.
(a) Manner of Payment. The principal amount of the Revolving Credit
Outstandings shall be due and payable to the Agent for the benefit of each
Lender in full on the Revolving Credit Termination Date, or earlier as
specifically provided herein. The principal amount of the Term Loan Outstandings
shall be due and payable to the Agent for the benefit of each Lender in full on
the Stated Termination Date, or earlier as specifically provided herein. The
principal amount of all Outstandings shall be recorded in Dollars as set forth
in Section 2.1. The repayment of such principal amount shall be made in the
appropriate Alternative Currency as follows: the portion of the Outstandings
attributable to each specified Advance (or the Continuation or Conversion
thereof) (as determined from the Agent's records) shall be repaid in the same
Alternative Currency as such Advance. The principal amount of any Base Rate Loan
may be prepaid in Dollars in whole or in part at any time. Other than
prepayments made pursuant to Section 2.3(b), the principal amount of any
Eurodollar Rate Loan may be prepaid only at the end of the applicable Interest
Period unless the applicable Borrower or Borrowers shall pay to the Agent for
the account of the Lenders the additional amount, if any, required under Section
5.5. All prepayments of Loans made by the Borrowers shall be in the amount of
$1,000,000 (or the Alternative Currency Equivalent Amount thereof) or such
greater amount which is an integral multiple of $1,000,000 (or the Alternative
Currency Equivalent Amount thereof), or the amount equal to all Outstandings, or
such other amount as necessary to comply with Section 2.1(c) or Section 2.8.
(b) Mandatory Prepayments. The Borrowers shall make the following required
prepayments, each such payment to be made to the Agent for the benefit of the
Lenders within the time period specified below and with respect to any Loan in
an Alternative Currency, in the Alternative Currency Equivalent Amount of the
amount due:
(i) Equity Offerings. BREED shall make, or shall cause each applicable
Subsidiary to make, a prepayment from the Net Proceeds of any Equity Offering in
an amount equal to one hundred percent (100%) of such Net Proceeds. Each such
prepayment shall be made within five (5) Business Days of receipt of such Net
Proceeds and upon not less than three (3) Business' Days written notice to the
Agent, and shall include within one (1) Business Day of repayment a certificate
of an Authorized Representative setting forth in reasonable detail the
calculations utilized in computing the amount of the Net Proceeds.
(ii) Debt Offerings. BREED shall make, or shall cause each applicable
Subsidiary to make, a prepayment from the Net Proceeds of any Debt Offering in
an amount equal to one hundred percent (100%) of such Net Proceeds. Each such
prepayment shall be made within five (5) Business Days of receipt of such Net
Proceeds and upon not less than three (3) Business' Days written notice to the
Agent, and shall include within one (1) Business Day of repayment a certificate
of an Authorized Representative setting forth in reasonable detail the
calculations utilized in computing the amount of the Net Proceeds.
(iii) Asset Dispositions. BREED shall make, or shall cause each applicable
Subsidiary to make, a prepayment from the Net Proceeds of any Asset Disposition
in an amount equal to one hundred percent (100%) of such Net Proceeds. Each such
prepayment shall be made within five (5) Business Days of receipt of such Net
Proceeds and upon not less than three (3) Business' Days written notice to the
Agent, which notice shall include a certificate of an Authorized Representative
setting forth in reasonable detail the calculations utilized in computing the
amount of the Net Proceeds. Notwithstanding the foregoing, however, an aggregate
amount of up to $10,000,000 of the Net Proceeds from the sale of nonproductive
foreign assets may be excluded from the payment required under this Section
2.3(b)(iii) to the extent that such amount is used for severance payments to
former employees of such foreign assets who were released from employment in
connection with such sale; provided, that upon receipt of the Operating Plan,
the Agent may, but in no event shall be required to, in its sole discretion,
increase the aggregate amount so excluded as appropriate; provided, further,
that any amount so excluded shall be included in the calculations required by
the preceding sentence.
(iv) Operating Plan. From and after the date of approval of the Operating
Plan, BREED shall
be entitled to retain an aggregate of $20,000,000 of Net Proceeds resulting
from Asset Dispositions received by it or its Subsidiaries subsequent to such
date of approval.
All mandatory prepayments made pursuant to this Section 2.3(b) shall be
applied first to repay all Term Loans until the Term Loan Outstandings have been
paid in full and then to permanently reduce the Total Revolving Credit
Commitment. Any prepayment of an Eurodollar Rate Loan pursuant to this Section
2.3(b) other than on the last day of an Interest Period shall be accompanied by
the additional payment, if any, required by Section 5.5 hereof.
2.4. Non-Conforming Payments. (a) Each payment of principal (including any
prepayment) and payment of interest and fees, and any other amount required to
be paid to the Lenders with respect to the Loans, shall be made to the Agent at
the Principal Office, for the account of each Lender, in Dollars in the case of
Loans made in Dollars and in the same Alternative Currency in the case of Loans
made in Alternative Currencies, in immediately available funds before 12:30 P.M.
on the date such payment is due. The applicable Borrower or Borrowers shall give
the Agent one (1) Business Days' prior written notice of any payment of
principal, such notice to be given prior to 11:00 A.M. and to specify (i) the
date the payment will be made and (ii) the Loan to which payment relates. The
Agent may, at the election of the applicable Borrower or Borrowers, but shall
not be obligated to, debit the amount of any such payment which is not made by
such time to any ordinary deposit account, if any, of the Borrowers with the
Agent.
(b) The Agent shall deem any payment made by or on behalf of the Borrowers
hereunder that is not made both (i) in Dollars in the case of Loans made in
Dollars and in the required Alternative Currency in the case of Loans made in
Alternative Currencies in immediately available funds and (ii) prior to 12:30
P.M. on the date payment is due to be a non-conforming payment. Any such payment
shall not be deemed to be received by the Agent until the later of (i)the time
such funds become available funds and (ii)the next Business Day. Any
non-conforming payment may constitute or become a Default or Event of Default at
the determination of the Agent. The Agent shall give prompt telephonic or
telefacsimile notice to the applicable Borrower or Borrowers if a non-conforming
payment constitutes a Default or an Event of Default. Interest shall continue to
accrue on any principal as to which a non-conforming payment is made until the
later of (x) the date such funds become available funds or (y) the next Business
Day at the Default Rate from the date such amount was due and payable.
(c) In the event that any payment hereunder or under the Notes becomes due
and payable on a day other than a Business Day, then such due date shall be
extended to the next succeeding Business Day unless provided otherwise under
clause (ii) of the definition of "Interest Period"; provided that interest shall
continue to accrue during the period of any such extension and provided further,
that in no event shall any such due date be extended beyond the Stated
Termination Date.
2.5. Notes. (a) Term Loans made by each Lender shall be evidenced by a Note
in substantially the form set forth as Exhibit O-1 payable to the order of such
Lender in the respective amount of its Applicable Commitment Percentage of the
Total Term Loan Commitment, which Note shall be dated the Closing Date or a
later date pursuant to an Assignment and Acceptance and shall be duly completed,
executed and delivered by BREED.
(b) Revolving Loans made by each Lender shall be evidenced by a Note in
substantially the form of Exhibit O-2 payable to the order of such Lender in the
respective amount of its Applicable Commitment
Percentage of the Total Revolving Credit Commitment, which Note shall be
dated the Closing Date or a later date pursuant to an Assignment and Acceptance
and shall be duly completed, executed and delivered by the Borrowers.
2.6. Pro Rata Payments. Except as otherwise provided herein, (a) each
payment on account of the principal of and interest on the Loans and the fees
described in Section 2.10 shall be made to the Agent for the account of the
Lenders pro rata based on their Applicable Commitment Percentages, (b) all
payments to be made by the Borrowers for the account of each of the Lenders on
account of principal, interest and fees, shall be made without diminution,
setoff, recoupment or counterclaim, and (c) the Agent will promptly distribute
to the Lenders in immediately available funds payments received in fully
collected, immediately available funds from the Borrowers.
2.7. Voluntary Commitment Reductions. The Borrowers shall, by notice from
an Authorized Representative, have the right from time to time but not more
frequently than once each calendar month, upon not less than three (3) Business
Days' written notice to the Agent, effective upon receipt, to repay Term Loans
or reduce the Total Revolving Credit Commitment. The Agent shall give each
Lender, within one (1) Business Day of receipt of such notice, telefacsimile
notice, or telephonic notice (confirmed in writing), of such reduction. Each
such reduction shall be in the aggregate amount of $5,000,000 (or the
Alternative Currency Equivalent Amount thereof in the case of a Revolving Loan)
or such greater amount which is in an integral multiple of $5,000,000 (or the
Alternative Currency Equivalent Amount thereof in the case of a Revolving Loan),
or the entire remaining Total Revolving Credit Commitment, and shall permanently
reduce the Total Revolving Credit Commitment. Each reduction of the Total
Revolving Credit Commitment shall be accompanied by payment of the Loans to the
extent that the principal amount of Revolving Credit Outstandings plus Letter of
Credit Outstandings exceeds the Total Revolving Credit Commitment after giving
effect to such reduction, together with accrued and unpaid interest on the
amounts prepaid. No such repayment or reduction shall result in the payment of
any Eurodollar Rate Loan other than on the last day of the Interest Period of
such Eurodollar Rate Loan unless such prepayment is accompanied by amounts due,
if any, under Section 5.5.
2.8. Conversions and Elections of Subsequent Interest Periods. Subject to
the limitations set forth below and in Article V, the applicable Borrower or
Borrowers may:
(a) upon delivery, effective upon receipt, of a properly completed Interest
Rate Selection Notice to the Agent on or before 11:00 A.M. on any Business Day,
Convert all or a part of Eurodollar Rate Loans to Base Rate Loans on the last
day of the Interest Period for such Eurodollar Rate Loans; and
(b) provided that no Default or Event of Default shall have occurred and be
continuing, upon delivery, effective upon receipt, of a properly completed
Interest Rate Selection Notice to the Agent on or before 11:00 A.M. three (3)
Business Days' prior to the date of such election or Conversion:
(i) elect a subsequent Interest Period for all or a portion of Eurodollar
Rate Loans to begin on the last day of the then current Interest Period for such
Eurodollar Rate Loans; and
(ii) Convert Base Rate Loans to Eurodollar Rate Loans on any Business Day;
(iii) elect that any Eurodollar Rate Loan be converted from an Alternative
Currency into
another Alternative Currency on the last day of the Interest Period for any
Eurodollar Rate Loan.
Each election and Conversion pursuant to this Section 2.8 shall be subject
to the limitations on Eurodollar Rate Loans set forth in the definition of
"Interest Period" herein and in Sections 2.1, 2.3 and Article V. The Agent shall
give written notice to each Lender of such notice of election or Conversion
prior to 3:00 P.M. on the day such notice of election or Conversion is received.
All such Continuations or Conversions of Loans shall be effected pro rata based
on the Applicable Commitment Percentages of the Lenders.
2.9. Increase and Decrease in Amounts. The amount of the Total Revolving
Credit Commitment which shall be available to the Borrowers as Advances shall be
reduced by the aggregate amount of Letters of Credit Outstandings.
2.10. Commitment Fee. For the period beginning on the Closing Date and
ending on the Revolving Credit Termination Date, the Borrowers agree to pay to
the Agent, for the prorata benefit of the Lenders based on their Applicable
Commitment Percentages, an unused fee equal to the Commitment Fee multiplied by
the average daily amount by which the Total Revolving Credit Commitment exceeds
the sum of (i) Revolving Credit Outstandings plus (ii) Letter of Credit
Outstandings. Such fees shall be due in arrears on the last Business Day of each
March,June, September and December commencing December 31,1997 to the Revolving
Credit Termination Date (but excluding such day for the purpose of computing
such fee). Notwithstanding the foregoing, so long as any Lender fails to make
available any portion of its Revolving Credit Commitment when requested, such
Lender shall not be entitled to receive payment of its pro rata share of such
fee until such Lender shall make available such portion. Such fee shall be
calculated on the basis of a year of 360 days for the actual number of days
elapsed.
2.11. Deficiency Advances. No Lender shall be responsible for any default
of any other Lender in respect to such other Lender's obligation to make any
Loan or fund its purchase of any Participation hereunder nor shall the Revolving
Credit Commitment or Term Loan Commitment of any Lender hereunder be increased
as a result of such default of any other Lender. Without limiting the generality
of the foregoing, in the event any Lender shall fail to advance funds to the
applicable Borrower or Borrowers as herein provided, the Agent may in its
discretion, but shall not be obligated to, advance under the Note in its favor
as a Lender all or any portion of such amount or amounts (each, a "deficiency
advance") and shall thereafter be entitled to payments of principal of and
interest on such deficiency advance in the same manner and at the same interest
rate or rates to which such other Lender would have been entitled had it made
such advance under its Note; provided that, upon payment to the Agent from such
other Lender of the entire outstanding amount of each such deficiency advance,
together with accrued and unpaid interest thereon, from the most recent date or
dates interest was paid to the Agent by the applicable Borrower or Borrowers on
each Loan comprising the deficiency advance at the interest rate per annum for
overnight borrowing by the Agent from the Federal Reserve Bank, then such
payment shall be credited against the applicable Note of the Agent in full
payment of such deficiency advance and the applicable Borrower or Borrowers
shall be deemed to have borrowed the amount of such deficiency advance from such
other Lender as of the most recent date or dates, as the case may be, upon which
any payments of interest were made by the applicable Borrower or Borrowers
thereon.
2.12. Use of Proceeds. The proceeds of the Loans made pursuant to the
Revolving Credit Facility hereunder shall be used by the Borrowers (i) to
purchase the Acquired Business pursuant to the Asset Purchase Agreement, (ii) to
refinance existing Indebtedness and the fees and expenses related to such
refinancing, and
(iii) for general working capital needs and other corporate purposes.
2.13. Designation of Borrowing Subsidiaries. With the consent of the Agent,
BREED may from time to time designate any Foreign Subsidiary of BREED which has
not joined in the execution of this Agreement as a "Borrowing Subsidiary"
hereunder under the Revolving Credit Facility by causing such Foreign Subsidiary
to execute and deliver a duly completed Assumption Letter in the form attached
hereto as Exhibit U to the Agent, with the written consent of BREED and the
Agent at the foot thereof. Upon such execution, delivery and consent such
Foreign Subsidiary shall for all purposes be a party hereto as a Borrowing
Subsidiary as fully as if it had executed and delivered this Agreement. So long
as all Obligations of any Borrowing Subsidiary under this Agreement shall have
been paid in full, such Borrowing Subsidiary may, by not less than five (5)
Business Days' prior notice to the Agent (which shall promptly notify the
Lenders thereof), terminate its status as a "Borrowing Subsidiary" hereunder.
ARTICLE III
Letters of Credit
3.1. Letters of Credit. (a) The Issuing Bank agrees, subject to the terms
and conditions of this Agreement, upon request of a Borrower or Borrowers to
issue from time to time for the account of the Borrower or Borrowers Letters of
Credit upon delivery to the Issuing Bank of an Application and Agreement for
Letter of Credit relating thereto in form and content acceptable to the Issuing
Bank; provided, that (i) the Letter of Credit Outstandings shall not exceed the
Total Letter of Credit Commitment and (ii) no Letter of Credit shall be issued
if, after giving effect thereto, Letter of Credit Outstandings plus the
Revolving Credit Outstandings shall exceed the Total Revolving Credit
Commitment. No Letter of Credit shall have an expiry date (including all rights
of a Borrower or any beneficiary named in such Letter of Credit to require
renewal) or payment date occurring later than the earlier to occur of one year
after the date of its issuance or the fifth Business Day prior to the Stated
Termination Date.
(b) Upon completion of a proper Application and Agreement for Letter of
Credit, NationsBank may issue upon request and for the account of an applicable
Borrower or Borrowers Letters of Credit payable in an Alternative Currency. For
purposes of determining Outstanding Letters of Credit, any Letter of Credit
issued in an Alternative Currency shall be recorded in the Agent's account in
Dollars based on the Alternative Currency Equivalent Amount on the date of
issuance of such Letter of Credit; provided, however, that the Agent shall
determine the Dollar Equivalent Amount of any Letter of Credit issued in an
Alternative Currency on the date of any Advance or Conversion for the purpose of
determining the amount of Revolving Credit Outstandings and compliance with the
Total Alternative Currency Sublimit. Any draw on a Letter of Credit issued in an
Alternative Currency shall be repaid in the same Alternative Currency Equivalent
Amount (determined based on the Spot Rate of Exchange on the date of drawing
under the Letter of Credit). In the event that the Agent shall determine at any
time that (i) the Dollar Value of outstanding Loans and Outstanding Letters of
Credit, in each case determined on the date of each Advance or issuance of a
Letter of Credit, made or issued in Alternative Currencies exceeds the Total
Alternative Currency Sublimit or (ii) that the sum of the Dollar Value described
in subclause (i) plus outstanding Revolving Loans and Outstanding Letters of
Credit made or issued in Dollars exceeds the Total Revolving Credit Commitment,
then the Borrowers shall immediately repay Revolving Loans so that after giving
effect to such payment the outstanding Revolving Loans plus Outstanding Letters
of Credit do not exceed the Total Revolving Credit Commitment and the Loans
advanced in an Alternative Currency plus
Outstanding Letters of Credit issued in and Alternative Currency do not
exceed the Total Alternative Currency Sublimit.
3.2. Reimbursement.
(a) The applicable Borrower or Borrowers hereby unconditionally agrees to
pay to the Issuing Bank immediately on demand at the Principal Office all
amounts required to pay all drafts drawn or purporting to be drawn under the
Letters of Credit and all reasonable expenses incurred by the Issuing Bank in
connection with the Letters of Credit, and in any event and without demand to
place in possession of the Issuing Bank (which shall include Advances under the
Revolving Credit Facility if permitted by Section 2.1(a)) sufficient funds to
pay all debts and liabilities arising under any Letter of Credit. The Issuing
Bank agrees to give the applicable Borrower or Borrowers prompt notice of any
request for a draw under a Letter of Credit. The Issuing Bank may, at the
request of the applicable Borrower or Borrowers, charge any account the
applicable Borrower or Borrowers may have with it for any and all amounts the
Issuing Bank pays under a Letter of Credit, plus charges and reasonable expenses
as from time to time agreed to by the Issuing Bank and the applicable Borrower
or Borrowers; provided that to the extent permitted by Section 2.1(d)(iv),
amounts shall be paid pursuant to Advances under the Revolving Credit Facility.
The Borrowers agree to pay the Issuing Bank interest on any Reimbursement
Obligations not paid when due hereunder at the Base Rate plus two percent
(2.0%), or the maximum rate permitted by applicable law, if lower, such rate to
be calculated on the basis of a year of 360 days for actual days elapsed.
(b) In accordance with the provisions of Section 2.1(d), the Issuing Bank
shall notify the Agent of any drawing under any Letter of Credit promptly
following the receipt by the Issuing Bank of such drawing.
(c) Each Lender (other than the Issuing Bank) shall automatically acquire
on the date of issuance thereof, a Participation in the liability of the Issuing
Bank in respect of each Letter of Credit in an amount equal to such Lender's
Applicable Commitment Percentage (determined based on the Spot Rate of Exchange
on the date of drawing under the Letter of Credit) of such liability, and to the
extent that the applicable Borrower or Borrowers are obligated to pay the
Issuing Bank under Section 3.2(a), each Lender (other than the Issuing Bank)
thereby shall absolutely, unconditionally and irrevocably assume, and shall be
unconditionally obligated to pay to the Issuing Bank as hereinafter described,
its Applicable Commitment Percentage of the liability of the Issuing Bank under
such Letter of Credit.
(i) Each Lender (including the Issuing Bank in its capacity as a Lender)
shall, subject to the terms and conditions of Article II, pay to the Agent for
the account of the Issuing Bank at the Principal Office in Dollars and in
immediately available funds, an amount equal to its Applicable Commitment
Percentage of any drawing under a Letter of Credit, such funds to be provided in
the manner described in Section 2.1(d)(iv).
(ii) Simultaneously with the making of each payment by a Lender to the
Issuing Bank pursuant to Section 2.1(d)(iv)(B), such Lender shall, automatically
and without any further action on the part of the Issuing Bank or such Lender,
acquire a Participation in an amount equal to such payment (excluding the
portion thereof constituting interest accrued prior to the date the Lender made
its payment) in the related Reimbursement Obligation of the applicable Borrower
or Borrowers. The Reimbursement Obligations of the Borrowers shall be
immediately due and payable whether by Advances made in accordance with Section
2.1(d)(iv), or otherwise.
(iii) Each Lender's obligation to make payment to the Agent for the account
of the Issuing Bank pursuant to Section 2.1(d)(iv) and this Section 3.2(c), and
the right of the Issuing Bank to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and shall be
made without any offset, abatement, withholding or reduction whatsoever. If any
Lender is obligated to pay but does not pay amounts to the Agent for the account
of the Issuing Bank in full upon such request as required by Section 2.1(d)(iv)
or this Section 3.2(c), such Lender shall, on demand, pay to the Agent for the
account of the Issuing Bank interest on the unpaid amount for each day during
the period commencing on the date of notice given to such Lender pursuant to
Section 2.1(d) until such Lender pays such amount to the Agent for the account
of the Issuing Bank in full at the interest rate per annum for overnight
borrowing by the Agent from the Federal Reserve Bank.
(iv) In the event the Lenders have purchased Participations in any
Reimbursement Obligation as set forth in clause (ii) above, then at any time
payment (in fully collected, immediately available funds) of such Reimbursement
Obligation, in whole or in part, is received by the Issuing Bank from the
applicable Borrower or Borrowers, the Issuing Bank shall promptly pay to each
Lender an amount equal to its Applicable Commitment Percentage of such payment
from the applicable Borrower or Borrowers.
(d) Promptly following the end of each calendar quarter, the Issuing Bank
shall deliver to the Agent a notice describing the aggregate undrawn amount of
all Letters of Credit at the end of such quarter. Upon the request of any Lender
from time to time, the Issuing Bank shall deliver to the Agent, and the Agent
shall deliver to such Lender, any other information reasonably requested by such
Lender with respect to each outstanding Letter of Credit.
(e) The issuance by the Issuing Bank of each Letter of Credit shall, in
addition to the conditions precedent set forth in Article VI, be subject to the
conditions that such Letter of Credit be in such form and contain such terms as
shall be reasonably satisfactory to the Issuing Bank consistent with the then
current practices and procedures of the Issuing Bank with respect to similar
letters of credit, and the applicable Borrower or Borrowers shall have executed
and delivered such other instruments and agreements relating to such Letters of
Credit as the Issuing Bank shall have reasonably requested consistent with such
practices and procedures and shall not be in conflict with any of the express
terms herein contained. All Letters of Credit shall be issued pursuant to and
subject to the Uniform Customs and Practice for Documentary Credits, 1993
revision, International Chamber of Commerce Publication No. 500 and all
subsequent amendments and revisions thereto.
(f) The Borrowers agree that the Issuing Bank may, in its sole discretion,
accept or pay, as complying with the terms of any Letter of Credit, any drafts
or other documents otherwise in order which may be signed or issued by an
administrator, executor, trustee in bankruptcy, debtor in possession, assignee
for the benefit of creditors, liquidator, receiver, attorney in fact or other
legal representative of a party who is authorized under such Letter of Credit to
draw or issue any drafts or other documents.
(g) Without limiting the generality of the provisions of Section 12.9, the
Borrowers hereby agree to indemnify and hold harmless the Issuing Bank, each
other Lender and the Agent from and against any and all claims and damages,
losses, liabilities, reasonable costs and expenses which the Issuing Bank, such
other Lender or the Agent may incur (or which may be claimed against the Issuing
Bank, such other Lender or the Agent) by any Person by reason of or in
connection with the issuance or transfer of or payment or failure to pay
under any Letter of Credit; provided that the Borrowers shall not be
required to indemnify the Issuing Bank, any other Lender or the Agent for any
claims, damages, losses, liabilities, costs or expenses to the extent, but only
to the extent, (i) caused by the willful misconduct or gross negligence of the
party to be indemnified or (ii) caused by the failure of the Issuing Bank to pay
under any Letter of Credit after the presentation to it of a request for payment
strictly complying with the terms and conditions of such Letter of Credit,
unless such payment is prohibited by any law, regulation, court order or decree.
The indemnification and hold harmless provisions of this Section 3.2(g) shall
survive repayment of the Obligations, occurrence of the Revolving Credit
Termination Date and expiration or termination of this Agreement.
(h) Without limiting the Borrowers' rights as set forth in Section 3.2(g),
the obligation of the Borrowers to immediately reimburse the Issuing Bank for
drawings made under Letters of Credit and the Issuing Bank's right to receive
such payment shall be absolute, unconditional and irrevocable, and such
obligations of the Borrowers shall be performed strictly in accordance with the
terms of this Agreement (as waived, modified or amended) and such Letters of
Credit and the related Applications and Agreement for any Letter of Credit,
under all circumstances whatsoever, including the following circumstances:
(i) any lack of validity or enforceability of the Letter of Credit, the
obligation supported by the Letter of Credit or any other agreement or
instrument relating thereto (collectively, the "Related LC Documents");
(ii) any amendment or waiver of or any consent to or departure from all or
any of the Related LC Documents;
(iii) the existence of any claim, setoff, defense (other than the defense
of payment in accordance with the terms of this Agreement) or other rights which
the Borrowers may have at any time against any beneficiary or any transferee of
a Letter of Credit (or any persons or entities for whom any such beneficiary or
any such transferee may be acting), the Agent, the Lenders or any other Person,
whether in connection with the Loan Documents, the Related LC Documents or any
unrelated transaction;
(iv) any breach of contract or other dispute between the Borrowers and any
beneficiary or any transferee of a Letter of Credit (or any persons or entities
for whom such beneficiary or any such transferee may be acting), the Agent, the
Lenders or any other Person;
(v) any draft, statement or any other document presented under the 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
whatsoever;
(iv) any delay, extension of time, renewal, compromise or other indulgence
or modification granted or agreed to by the Agent, with or without notice to or
approval by the Borrowers in respect of any of the Borrowers' Obligations under
this Agreement.
Nothing contained in this clause (h) shall relieve the Issuing Bank of
liability for its gross negligence or willful misconduct or breach of contract.
3.3. Letter of Credit Facility Fees. The Borrowers shall pay to the Agent,
(i) for the pro rata benefit of the Lenders based on their Applicable Commitment
Percentages, a fee on the aggregate amount available to be drawn on each
outstanding Letter of Credit at a rate equal to the Applicable Margin for
Eurodollar Rate Loans, and (ii) for the Issuing Bank, when there is more than
one Lender, 0.125% based on the aggregate amount available to be drawn on each
outstanding Letter of Credit. Such fees shall be due with respect to each Letter
of Credit quarterly in arrears on the last day of each March, June, September
and December, the first such payment to be made on the date of issuance of a
Letter of Credit. The fees described in this Section 3.3 shall be calculated on
the basis of a year of 360 days for the actual number of days elapsed.
ARTICLE IV
Security
4.1. Guaranty. To guarantee the full and timely payment and performance of
all Obligations now existing or hereafter arising, the Borrowers shall cause the
Guaranty to be delivered by each Domestic Subsidiary that is not a Borrowing
Subsidiary in the form and substance reasonably acceptable to the Agent, on or
before the Closing Date. The Borrowers hereby agree to cause a Guaranty to be
delivered by any hereafter acquired or created Domestic Subsidiary pursuant to
the terms of Section 8.19 hereof. Notwithstanding the foregoing, a Domestic
Subsidiary formed to issue Convertible Preferred Securities (and whose only
asset is the Convertible Debentures or amounts received thereon) shall not be
required to become a Guarantor.
4.2. Stock Pledge. (a) As security for the full and timely payment and
performance of (i) all Obligations now existing or hereafter arising and (ii) if
applicable, its obligations as a Guarantor under the Guaranty Agreement, the
Borrowers and each Person owning any Pledged Stock shall on or before the
Closing Date deliver to the Agent, in form and substance reasonably acceptable
to the Agent, a Pledge Agreement together with certificates representing such
Pledged Stock with stock powers duly executed in blank which Pledge Agreements
shall pledge to the Agent for the benefit of the Lenders (w) 100% of the capital
stock and related interests and rights of any Domestic Subsidiary and any
Subsidiary of a Borrowing Subsidiary and (x) not less than 65% of the Voting
Stock and 100% of the non-voting common stock and related interests and rights
of any Direct Foreign Subsidiary in accordance with the terms hereof and
thereof.
(b) BREED and each Subsidiary hereby agree to pledge to the Agent for the
benefit of the Lenders (y) 100% of the capital stock and related interests and
rights of any Domestic Subsidiary and any Subsidiary of a Borrowing Subsidiary
hereafter acquired or created and owned directly or indirectly by BREED and (z)
not less than 65% of the Voting Stock and 100% of the non-voting common stock
and related interests and rights of any Direct Foreign Subsidiary hereafter
acquired or created and, in each case, to deliver to the Agent a Pledge
Agreement substantially in the form of Exhibit P-1 or P-2, as applicable within
thirty (30) days after the acquisition or creation of such Domestic Subsidiary
or Direct Foreign Subsidiary, as the case may be, pursuant to the terms of
Section 8.19, hereof; provided, however, in the event the laws or practices of
any foreign jurisdiction preclude or prevent the completion or delivery of the
Pledge Agreement as provided herein, the Direct Foreign Subsidiary shall have an
additional forty-five (45) days to deliver such Pledge Agreement.
4.3. Security Interests. As security for the full and timely payment and
performance of (i) all Obligations now existing or hereafter arising and (ii) if
applicable, its obligations as a Guarantor under the Guaranty Agreement, BREED
shall, and shall cause each Domestic Subsidiary to, on or before the Closing
Date deliver to
the Agent, in form and substance reasonably acceptable to the Agent, the
Security Agreement, the Uniform Commercial Code financing statements, and each
other Security Instrument sufficient to grant to the Agent a valid, duly
perfected security interest in the Collateral described therein, subject to no
prior Liens other than Permitted Liens, and with respect to the Mortgages, no
prior Liens other than the Permitted Encumbrances as defined therein, and do all
things necessary in the opinion of the Agent and its counsel to grant to the
Agent for the benefit of the Lenders a first priority security interest, duly
perfected with respect to Collateral governed by the UCC, in all Collateral
subject to no prior Lien or other encumbrance or restriction on transfer (other
than restrictions on transfer imposed by applicable securities laws and
Permitted Liens). BREED hereby agrees to cause the Security Instruments to be
delivered by any hereafter acquired or created Domestic Subsidiary or, to the
extent applicable under foreign law or practice, Direct Foreign Subsidiary
pursuant to the terms of Section 8.19 hereof.
4.4. Lease Assignments. As security for the full and timely payment and
performance of (i) all Obligations now existing or hereafter arising and (ii) if
applicable, the Guarantors' Obligations under the Guaranty Agreement, BREED
shall, and shall cause each Domestic Subsidiary to, on or before the Closing
Date deliver to the Agent, in form and substance reasonably acceptable to the
Agent, the Lease Assignments. The Lease Assignments shall be delivered on or
before the Closing Date and thereafter as any new or additional facility is
leased by BREED or any existing or hereafter acquired or created Domestic
Subsidiary.
4.5. Mortgages. As security for the full and timely payment and performance
of (i) all Obligations now existing or hereafter arising and (ii) if applicable,
the Guarantors' Obligations under the Guaranty Agreement, BREED shall, and shall
cause each Domestic Subsidiary to, on or before the Closing Date deliver to the
Agent, in form and substance reasonably acceptable to the Agent, the Mortgages.
The Mortgages shall be delivered on or before the Closing Date and thereafter as
any new or additional real property is acquired by BREED or any existing or
hereafter acquired or created Domestic Subsidiary.
4.6. Landlord Waivers. As security for the full and timely payment and
performance of (i) all Obligations now existing or hereafter arising and (ii) if
applicable, the Guarantors' Obligations under the Guaranty Agreement, BREED
shall, and shall cause each Domestic Subsidiary to, on or before the Closing
Date deliver to the Agent, in form and substance reasonably acceptable to the
Agent, to the extent available, the Landlord Waivers. The Landlord Waivers shall
be delivered on or before the Closing Date and thereafter as new or additional
facility is leased by BREED or any existing or hereafter acquired or created
Domestic Subsidiary.
4.7. Intellectual Property. As security for the full and timely payment and
performance of (i) all Obligations now existing or hereafter arising and (ii)
certain of the Guarantors' Obligations under the Guaranty Agreement, BREED
shall, and shall cause each Domestic Subsidiary to, on or before the Closing
Date deliver to the Agent, in form and substance reasonably acceptable to the
Agent, the Intellectual Property Security Agreement and the Intellectual
Property Assignment. BREED hereby agrees to pledge, or cause to be pledged, all
intellectual property interests and licenses hereafter acquired or created and
owned by BREED and any Domestic Subsidiary within thirty (30) days of the
acquisition or creation of such intellectual property or license, pursuant to
the terms of Section 8.19; provided, however, that should any Intellectual
Property Agreement require the consent of any third party, BREED and its
Domestic Subsidiaries shall use its best efforts to supply such Assignment;
provided further that in the event the execution of an Assignment or the
assignment of the Intellectual Property shall result in a forfeiture of such
Intellectual Property this provision shall not apply to such Intellectual
Property.
4.8. Pledge and Subordination of Intercompany Notes. As security for the
full and timely payment and performance of (i) all Obligations now existing or
hereafter arising and (ii) certain of the Guarantors' Obligations under the
Guaranty Agreement, BREED shall cause the Intercompany Note Holders to deliver
the Intercompany Note Pledge Agreement to the Agent for the benefit of the
Lenders. BREED hereby agrees to cause the Intercompany Note Holders now existing
or hereafter acquired or created to pledge, xxxxx x Xxxx and collaterally assign
to the Agent for the benefit of the Lenders all Intercompany Notes now existing
or hereafter arising.
4.9. Pledge of Partnership Interests. (a) As security for the full and
timely payment and performance of (i) all Obligations now existing or hereafter
arising and (ii) if applicable, the Guarantors' Obligations under the Guaranty
Agreement, BREED and each Person owning any Assigned Interests shall on or
before the Closing Date deliver to the Agent, in form and substance reasonably
acceptable to the Agent, a Collateral Assignment of Partnership Interests
together with a Receipt and Certificate of Registrar as may be required by the
Agent, which Collateral Assignment of Partnership Interests shall pledge to the
Agent for the benefit of the Lenders 100% of the ownership interests and rights
in limited partnerships in accordance with the terms hereof and thereof and, to
the extent hereafter required by the Agent, any joint venture interests.
(b) BREED and each Subsidiary hereby agree to collaterally assign to the
Agent for the benefit of the Lenders 100% of the ownership interests and rights
in limited partnership and joint ventures hereafter acquired or created, other
than the joint venture described in Section 9.6(h), and to deliver to the Agent
a Collateral Assignment of Partnership Interests substantially in the form and
content acceptable to the Agent within thirty (30) days of the acquisition or
creation of such Subsidiary pursuant to the terms of Section 8.19.
4.10. Collateral Assignment of Trademark License Agreement. As security for
the full and timely payment and performance of (i) all Obligations now existing
or hereafter arising and (ii) if applicable, the Guarantors' Obligations under
the Guaranty Agreement, BREED shall cause the Collateral Assignment of Trademark
License Agreement to be delivered to the Agent for the benefit of the Lenders on
or before the Closing Date.
4.11. Further Assurances. At the request of the Agent, BREED will, and will
cause each Subsidiary to, execute by its duly authorized officers, alone or with
the Agent, any certificate, instrument, statement or document and will procure
any such certificate, instrument, statement or document (and pay all connected
costs) which the Agent reasonably deems necessary to create or preserve the
Liens (and the perfection and priority thereof) of the Agent for the benefit of
the Lenders contemplated hereby and by the other Loan Documents.
ARTICLE V
Change in Circumstances
5.1. Increased Cost and Reduced Return. (a) If, after the date hereof, the
adoption of any applicable law, rule, or regulation, or any change in any
applicable law, rule, or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender (or its Applicable Lending Office) with any request or
directive (whether or not having the force of law) of any such governmental
authority, central bank, or comparable agency:
(i) shall subject such Lender (or its Applicable Lending Office) to any
tax, duty, or other charge with respect to any Eurodollar Rate Loans, its Note,
or its obligation to make Eurodollar Rate Loans, or change the basis of taxation
of any amounts payable to such Lender (or its Applicable Lending Office) under
this Agreement or its Note in respect of any Eurodollar Rate Loans (other than
taxes imposed on the overall net income of such Lender by the jurisdiction in
which such Lender has its principal office or such Applicable Lending Office and
franchise taxes);
(ii) shall impose, modify, or deem applicable any reserve, special deposit,
assessment, or similar requirement (other than the Reserve Requirement utilized
in the determination of the Eurodollar Rate) relating to any extensions of
credit or other assets of, or any deposits with or other liabilities or
commitments of, such Lender (or its Applicable Lending Office), including the
Total Credit Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable Lending Office) or the
London interbank market any other condition affecting this Agreement or its Note
or any of such extensions of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such
Lender (or its Applicable Lending Office) of making, Converting into,
Continuing, or maintaining any Eurodollar Rate Loans or to reduce any sum
received or receivable by such Lender (or its Applicable Lending Office) under
this Agreement or its Note with respect to any Eurodollar Rate Loans, then the
Borrowers shall pay to such Lender on demand such amount or amounts as will
compensate such Lender for such increased cost or reduction. If any Lender
requests compensation by the Borrowers under this Section 5.1(a), the Borrowers
may, by notice to such Lender (with a copy to the Agent), suspend the obligation
of such Lender to make or Continue Loans of the Type with respect to which such
compensation is requested, or to Convert Loans of any other Type into Loans of
such Type, until the event or condition giving rise to such request ceases to be
in effect (in which case the provisions of Section 5.4 shall be applicable);
provided that such suspension shall not affect the right of such Lender to
receive the compensation so requested.
(b) If, after the date hereof, any Lender shall have determined that the
adoption of any applicable law, rule, or regulation regarding capital adequacy
or any change therein or in the interpretation or administration thereof by any
governmental authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
governmental authority, central bank, or comparable agency, has or would have
the effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change, request, or
directive (taking into consideration its policies with respect to capital
adequacy), then from time to time upon demand the Borrowers shall pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction.
(c) Each Lender shall promptly notify the Borrowers and the Agent of any
event of which it has actual knowledge, occurring after the date hereof, which
will entitle such Lender to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
reasonable judgment of such Lender, be otherwise disadvantageous to it. Any
Lender claiming compensation under this Section shall furnish to the
Borrowers and the Agent a statement setting forth the additional amount or
amounts to be paid to it hereunder which shall be conclusive in the absence of
manifest error. In determining such amount, such Lender may use any reasonable
averaging and attribution methods.
5.2. Limitation on Types of Loans. If on or prior to the first day of any
Interest Period for any Eurodollar Rate Loan:
(a) the Agent determines (which determination shall be conclusive) that by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such Interest
Period; or
(b) the Required Lenders determine (which determination shall be
conclusive) and notify the Agent that the Eurodollar Rate will not adequately
and fairly reflect the cost to the Lenders of funding Eurodollar Rate Loans for
such Interest Period;
then the Agent shall give the Borrowers prompt notice thereof specifying
the relevant Type of Loans and the relevant amounts or periods, and so long as
such condition remains in effect, the Lenders shall be under no obligation to
make additional Loans of such Type, Continue Loans of such Type, or to Convert
Loans of any other Type into Loans of such Type and the applicable Borrower or
Borrowers shall, on the last day(s) of the then current Interest Period(s) for
the outstanding Loans of the affected Type, either prepay such Loans or Convert
such Loans into another Type of Loan in accordance with the terms of this
Agreement.
5.3. Illegality. Notwithstanding any other provision of this Agreement, in
the event that it becomes unlawful for any Lender or its Applicable Lending
Office to make, maintain, or fund Eurodollar Rate Loans hereunder, then such
Lender shall promptly notify the applicable Borrower or Borrowers thereof and
such Lender's obligation to make or Continue Eurodollar Rate Loans and to
Convert other Types of Loans into Eurodollar Rate Loans shall be suspended until
such time as such Lender may again make, maintain, and fund Eurodollar Rate
Loans (in which case the provisions of Section 5.4 shall be applicable).
5.4. Treatment of Affected Loans. If the obligation of any Lender to make a
particular Type of Eurodollar Rate Loan or to Continue, or to Convert Loans of
any other Type into, Loans of a particular Type shall be suspended pursuant to
Section 5.1 or 5.3 hereof (Loans of such Type being herein called "Affected
Loans" and such Type being herein called the "Affected Type"), such Lender's
Affected Loans shall be automatically Converted into Base Rate Loans on the last
day(s) of the then current Interest Period(s) for Affected Loans (or, in the
case of a Conversion required by Section 5.3 hereof, on such earlier date as
such Lender may specify to the Borrowers with a copy to the Agent) and, unless
and until such Lender gives notice as provided below that the circumstances
specified in Section 5.1 or 5.3 hereof that gave rise to such Conversion no
longer exist:
(a) to the extent that such Lender's Affected Loans have been so Converted,
all payments and prepayments of principal that would otherwise be applied to
such Lender's Affected Loans shall be applied instead to its Base Rate Loans;
and
(b) all Loans that would otherwise be made or Continued by such Lender as
Loans of the Affected Type shall be made or Continued instead as Base Rate
Loans, and all Loans of such Lender that would otherwise be Converted into Loans
of the Affected Type shall be Converted instead into (or shall remain as) Base
Rate
Loans.
If such Lender gives notice to the applicable Borrower or Borrowers (with a
copy to the Agent) that the circumstances specified in Section 5.1 or 5.3 hereof
that gave rise to the Conversion of such Lender's Affected Loans pursuant to
this Section 5.4 no longer exist (which such Lender agrees to do promptly upon
such circumstances ceasing to exist) at a time when Loans of the Affected Type
made by other Lenders are outstanding, such Lender's Base Rate Loans shall be
automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding Loans of the Affected Type, to the extent
necessary so that, after giving effect thereto, all Loans held by the Lenders
holding Loans of the Affected Type and by such Lender are held pro rata (as to
principal amounts, Types, and Interest Periods) in accordance with their
respective Revolving Credit Commitments and Term Loan Commitments.
5.5. Compensation. Upon the request of any Lender, the Borrowers shall pay
to such Lender such amount or amounts as shall be sufficient (in the reasonable
opinion of such Lender) to compensate it for any loss, cost, or expense
(including loss of anticipated profits) incurred by it as a result of:
(a) any payment, prepayment, or Conversion of a Eurodollar Rate Loan for
any reason (including, without limitation, the acceleration of the Loans
pursuant to Section 9.1) on a date other than the last day of the Interest
Period for such Loan; or
(b) any failure by the Borrowers for any reason (including, without
limitation, the failure of any condition precedent specified in Article VI to be
satisfied) to borrow (other than by reason of the failure of a Lender or Lenders
to make funds available without cause), Convert, Continue, or prepay a
Eurodollar Rate Loan on the date for such borrowing, Conversion, Continuation,
or prepayment specified in the relevant notice of borrowing, prepayment,
Continuation, or Conversion under this Agreement.
Any Lender claiming compensation under this Section 5.5 shall furnish the
Borrowers and the Agent a statement setting forth in reasonable detail the
amounts to be paid to it hereunder and the determination thereof shall be
conclusive absent manifest error.
5.6. Taxes. (a) Any and all payments by the Borrowers to or for the account
of any Lender or the Agent hereunder or under any other Loan Document shall be
made free and clear of and without deduction for any and all present or future
taxes, duties, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender and the
Agent, taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction under the laws of which such Lender (or its Applicable Lending
Office) or the Agent (as the case may be) is organized or any political
subdivision thereof, except withholding taxes applicable to a Lender, (all such
non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings,
and liabilities being hereinafter referred to as "Taxes"). If the Borrowers or
the Lender shall be required by law to deduct any Taxes from or in respect of
any sum payable under this Agreement or any other Loan Document to any Lender or
the Agent, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 5.6) such Lender or the Agent receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrowers shall make such deductions, (iii) the Borrowers shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable law, and (iv) the Borrowers shall furnish to
the Agent, at its address referred to in Section 11.2, the original or a
certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrowers agree to pay any and all present or future
stamp or documentary taxes and any other excise or property taxes or charges or
similar levies which arise from any payment made under this Agreement or any
other Loan Document or from the execution or delivery of, or otherwise with
respect to, this Agreement or any other Loan Document (hereinafter referred to
as "Other Taxes").
(c) The Borrowers agree to indemnify each Lender and the Agent for the full
amount of Taxes and Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section 5.6) paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, interest, and expenses) arising therefrom or
with respect thereto.
(d) Each Lender organized under the laws of a jurisdiction outside the
United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Lender listed on the signature pages hereof and on
or prior to the date on which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in writing by the
Borrowers or the Agent (but only so long as such Lender remains lawfully able to
do so), shall provide the Borrowers and the Agent with (a) if such Lender is a
"bank" within the meaning of Section 881(c)(3)(A) of the Code (i) Internal
Revenue Service Form 1001 or 4224, as appropriate, or any successor form
prescribed by the Internal Revenue Service, certifying that such Lender is
entitled to benefits under an income tax treaty to which the United States is a
party which reduces the rate of withholding tax on payments of interest or
certifying that the income receivable pursuant to this Agreement is effectively
connected with the conduct of a trade or business in the United States, (ii)
Internal Revenue Service Form W-8 or W-9, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and (iii) any other form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Internal Revenue Code), certifying that
such Lender is entitled to an exemption from or a reduced rate of tax on
payments pursuant to this Agreement or any of the other Loan Documents or, (b)
if such Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the
Code and which intends to claim exemption from U.S. Federal withholding tax
under Section 871(h) of 881(c) of the Code with respect to payments of
"portfolio interest", a form W-8, or any subsequent versions thereof or
successors thereto (and, if such Lender delivers a Form W-8, a certificate
representing that such Lender is not a bank for purposes of Section 881(c) of
the Code, is not a 10-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Code of any of the Borrowers and is not a controlled foreign
corporation related to any of the Borrowers (within the meaning of Section
864(d)(4) of the Code)), properly completed and duly executed by such Lender
claiming complete exemption from, or a reduced rate of, U.S. Federal withholding
tax on payments of interest by the Borrower under this Agreement and the other
Loan Documents.
(e) For any period with respect to which a Lender has failed to provide the
Borrowers and the Agent with the appropriate form pursuant to Section 5.6(d)
(unless such failure is due to a change in treaty, law, or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 5.6(a) or
5.6(b) with respect to Taxes imposed by the United States; provided, however,
that should a Lender, which is otherwise exempt from or subject to a reduced
rate of withholding tax, become subject to Taxes because of its failure to
deliver a form required hereunder, the Borrowers shall take such steps as such
Lender shall reasonably request to assist such Lender to recover such Taxes at
such Lender's expense.
(f) If the Borrowers are required to pay additional amounts to or for the
account of any Lender pursuant to this Section 5.6, then such Lender will agree
to use reasonable efforts to change the jurisdiction of its Applicable Lending
Office so as to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such Lender, is not
otherwise disadvantageous to such Lender.
(g) Within thirty (30) days after the date of any payment of Taxes, the
Borrowers shall furnish to the Agent evidence of such payment and the Agent
shall provide a copy of such evidence to the applicable Lender.
(h) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers contained
in this Section 5.6 shall survive the termination of the Revolving Credit
Commitments and Term Loan Commitments and the payment in full of the Notes.
5.7. Lending Office. Without affecting its rights under this Article V or
any other provision of this Agreement, each Lender agrees that if there is any
increase in cost to or reduction in an amount receivable by such Lender with
respect to which the Borrowers would be obligated to compensate such Lender
pursuant to this Article V, such Lender shall use reasonable efforts to elect an
alternative lending office (to the extent such Lender has available to it such
an office) which would not result in any such increase in any cost to or
reduction in any amount receivable by such Lender; provided, however, that no
Lender shall be obligated to select an alternative lending office if such Lender
determines, in its sole discretion, that (i) as a result of such selection such
Lender would be in violation of any applicable law, regulation, treaty, or
guideline, or would incur additional costs or expenses or (ii) such selection
would be inadvisable for regulatory reasons or would impose an unreasonable
burden or additional costs on such Lender.
5.8. Syndication Costs. If during Phase I, II, or III (as set forth in the
definition of Applicable Margin), the Agent incurs any breakage costs, charges
or fees incurred with respect to Eurodollar Rate Loans on account of the
syndication of the Revolving Credit Facility and Term Loan Facility, the
Borrowers shall immediately reimburse the Agent for any such costs, charges or
fees. Such right of reimbursement is in addition to, and not in limitation of,
the other provisions of this Article V. In addition, the Borrowers agree that
the incurrence of such costs and expenses shall not be the basis for the
Borrowers withholding its consent or approval of any Person as an Eligible
Assignee.
5.9. Replacement Banks. BREED may, on ten (10) Business Days' prior written
notice to the Agent and a Lender, cause a Lender who has incurred increased
costs or is unable to make Eurodollar Rate Loans to (and such Lender shall)
assign, pursuant to Section 12.1, all of its rights and obligations under this
Agreement to an Eligible Assignee designated by BREED which is willing to become
a Lender for a purchase price equal to the outstanding principal amount of the
Loans payable to such Lender plus any accrued but unpaid interest on such Loans,
any accrued but unpaid fees with respect to such Lender's Revolving Credit
Commitment and any other amount payable to such Lender under this Agreement;
provided, however, that any expenses or other amounts which would be owing to
such Lender pursuant to any indemnification provision hereof (including, if
applicable, Section 5.5) shall be payable by BREED as if BREED had prepaid the
Loans of such Lender rather than such Lender having assigned its interest
hereunder. BREED or the assignee shall pay the applicable processing fee under
Section 12.1.
ARTICLE VI
Conditions to Making Loans and Issuing Letters of Credit
6.1. Conditions of Term Loan and Initial Advance. The obligation of the
Lenders to make the Term Loan and the initial Advance under the Revolving Credit
Facility, and of the Issuing Bank to issue any Letter of Credit, is subject to
the conditions precedent that:
(a) the Agent shall have received on the Closing Date, in form and
substance satisfactory to the Agent and Lenders, the following:
(i) executed originals of each of this Agreement, the Notes, the initial
Guaranties, the Security Instruments, the LC Account Agreement, and the other
Loan Documents, together with all schedules and exhibits thereto;
(ii) the favorable written opinion or opinions with respect to the Loan
Documents and the transactions contemplated thereby of special counsel to the
Loan Parties dated the Closing Date (including opinions of local U.S. counsel,
local counsel to Direct Foreign Subsidiaries, special U.S. intellectual property
counsel as to issues relating to Collateral, and special tax counsel as to the
deductibility of interest payments on the Convertible Preferred Securities),
addressed to the Agent and the Lenders and satisfactory to Xxxxx Xxxxx Mulliss &
Xxxxx, L.L.P., special counsel to the Agent, substantially in the forms of
Exhibit X-0, X-0, and S-3 hereto;
(iii) resolutions of the boards of directors or other appropriate governing
body (or of the appropriate committee thereof) of each of the Loan Parties
certified by its secretary or assistant secretary as of the Closing Date,
approving and adopting the Loan Documents to be executed by such Person, and
authorizing the execution and delivery thereof;
(iv) specimen signatures of officers of each of the Loan Parties executing
the Loan Documents on behalf of such Person, certified by the secretary or
assistant secretary of such Person;
(v) the Organizational Documents of each of the Loan Parties certified as
of a recent date by the Secretary of State of its state of organization;
(vi) the Operating Documents of each of the Loan Parties certified as of
the Closing Date as true and correct by its secretary or assistant secretary;
(vii) certificates issued as of a recent date by the Secretaries of State
of the respective jurisdictions of formation of each of the Credit Parties as to
the due existence and good standing of such Person or the equivalent, if any, in
foreign jurisdictions;
(viii) appropriate certificates of qualification to do business, good
standing and, where appropriate, authority to conduct business under assumed
name, issued in respect of each of the Credit Parties as of a recent date by the
Secretary of State or comparable official of each jurisdiction, if any, in which
the failure to be qualified to do business or authorized so to conduct business
could have a Material Adverse Effect;
(ix) stock certificates representing all of the shares of Pledged Stock
with undated stock powers executed in blank for each certificate;
(x) copies of all partnership and joint venture agreements certified as
true and complete by the Secretary or Assistant Secretary of the Loan Party
party thereto;
(xi) Certificate and Receipt of Registrar of all of the Assigned Interests;
(xii) Intercompany Notes existing as of the Closing Date together with
endorsements or instruments of assignment executed in blank and attached
thereto;
(xiii) consent by makers of Intercompany Notes to pledge under Intercompany
Note Assignment;
(xiv) copies of the Organizational Documents and Operating Documents for A.
Breed, Ltd. and J. Breed, Ltd.
(xv) commitments for policies insuring title to the Mortgaged Properties
acceptable in form and substance to the Agent;
(xvi) copies of title exceptions with respect to the Mortgaged Properties,
acceptable in form and substance to the Agent;
(xvii) to the extent they currently exist, surveys for the owned real
property of BREED and its Subsidiareis;
(xviii) insurance report for certain owned and leased real property of
BREED and its Subsidiaries as reasonably required by the Agent;
(xix) flood certificates and evidence of flood insurance for any Mortgaged
Property in a federally designated flood zone;
(xx) owner's affidavit for each of the Mortgaged Properties;
(xxi) to the extent available to BREED, the environmental audit with
respect to the owned and leased real property of BREED and its Subsidiaries and
other environmental information as reasonably requested by the Agent and with
results satisfactory to the Agent;
(xxii) to the extent consented to by the respective landlords, Landlord
Waivers and Lease Assignments for each of BREED's or any Domestic Subsidiary's
leased facilities;
(xxiii) to the extent available, consents to the Lease Assignments from
each landlord for the leased real property of BREED and its Domestic
Subsidiaries;
(xxiv) an executed copy of the sublease from AlliedSignal to BREED of the
Greenville,
Alabama property; and a copy of the opinion required under the lease
between AlliedSignal and the Industrial Development Board of the City of
Greenville dated May 1, 1992 as a condition to AlliedSignal subleasing such
property to BREED; and consents from The Bank of New York, the Indenture Trustee
and the Industrial Development Board of the City of Greenville, in form and
substance satisfactory to the Agent, consenting to the assignment of the
sublease to the Agent;
(xxv) certified copy of the Trademark License Agreement;
(xxvi) UCC-1 Financing Statements, including without limitation fixture
filings, duly executed by the Borrowers and each of the Guarantors and in proper
form for filing, for all locations required by applicable law to perfect the
lien of the Agent and the Lenders under the Security Agreement as a first
priority Lien as to items of Collateral in which a security interest may be
perfected by the filing of financing statements;
(xxvii) a copy of BREED's employment agreement with each of the Managers,
certified as true and complete by the Secretary or Assistant Secretary of BREED;
(xxviii)receipt and satisfactory review of (A) audited consolidated
financial statements of BREED and its Subsidiaries as of June 30, 1997, (B)
consolidated interim financial statements of BREED and its Subsidiaries as of
July 31, 1997, and (C) operating statements of the Acquired Business as of
August 31, 1997;
(xxix) receipt and satisfactory review of a pro forma consolidated balance
sheet, income statement and statement of cash flows of BREED as of June 30,
1997, adjusted to give effect to the Allied Acquisition and the financings
contemplated in this Agreement reviewed by certified public accountants
acceptable to the Agent;
(xxx) notice of appointment of the initial Authorized Representative(s);
(xxxi) all schedules to the Credit Agreement and the other Loan Documents
which shall be reviewed by and satisfactory to the Agent;
(xxxii) evidence of the insurance program to be maintained by BREED and its
Subsidiaries after the Allied Acquisition, which such program shall be
reasonably satisfactory to the Agent;
(xxxiii)executed copies, certified as true and correct by the Secretary of
BREED, of the Siemens Stock Purchase Documents and the Prudential Stock Purchase
Documents together with evidence of receipt of at least $300,000,000 in the
aggregate from the Siemens Stock Purchase and the Prudential Stock Purchase;
(xxxiv)certificate of the President or Chief Financial Officer of BREED
that (A) all conditions precedent to the consummation of the Siemens Stock
Purchase and the Prudential Stock Purchase have been satisfied, (B) all
conditions precedent to the consummation of the Allied Acquisition as set forth
in the Asset Purchase Agreement and other Acquisition Documents have been
satisfied and not waived without the approval of the Agent including all
required consents set forth on Schedule 9.3 of the Asset Purchase Agreement and
all Required Consents (as defined in the Asset Purchase Agreement) of third
parties, (C) upon the tendering of the cash proceeds from the Revolving Credit
Facility and Term Loan Facility, the Allied Acquisition shall be
effective, and (D) no event has occurred or condition exists that could
reasonably be expected to have a material adverse effect on the ability of BREED
or any other party thereto to consummate the Convertible Preferred Securities
Issuance;
(xxxv) evidence satisfactory to the Agent that after payment of the
purchase price for the Allied Acquisition, repayment of existing Indebtedness
and all related fees and expenses, and after deducting all Letter of Credit
Outstandings, there shall be available to the Borrowers for working capital at
least $75,000,000;
(xxxvi)a schedule of the corporate and capital ownership structure of BREED
and its Subsidiaries immediately after giving effect to the Allied Acquisition
which shall be reviewed by and be satisfactory to the Agent;
(xxxvii)evidence that all fees payable by BREED to the Agent, NMSI and the
Lenders have been paid in full;
(xxxviii)an initial Borrowing Notice, if any;
(xxxix)payoff letters from the holders of existing Indebtedness to be
refinanced with the Revolving Credit Facility;
(xl) such other documents, instruments, certificates and opinions as the
Agent or any Lender may reasonably request in connection with the consummation
of the transactions contemplated hereby, including the due perfection of a first
priority security interest in all Collateral.
(b) In the good faith judgment of the Agent and the Lenders:
(i) there shall not have occurred or become known to the Agent or the
Lenders any event, condition, situation or status since the date of the
information contained in the financial and business projections, budgets, pro
forma data and forecasts concerning BREED and its Subsidiaries delivered to the
Agent prior to the making of the initial Loan that has had or could reasonably
be expected to result in a Material Adverse Effect;
(ii) no litigation, action, suit, investigation or other arbitral,
administrative or judicial proceeding shall be pending or threatened that
purports to affect BREED or its Subsidiaries, or the Acquired Business or that
could have a material adverse effect on BREED or its Subsidiaries, the Acquired
Business, the Allied Acquisition or any other transaction contemplated hereby or
on the ability of BREED and the other Loan Parties to perform their obligations
under the Loan Documents and the early termination or expiration of any
applicable waiting period imposed by law or regulation with respect the Allied
Acquisition without notice of intent to challenge or a request for additional
information, and no injunction shall have been issued enjoining BREED from
purchasing the Acquired Business;
(iii) the Loan Parties shall have received all approvals, consents and
waivers, and shall have made or given all necessary filings and notices as shall
be required to consummate the Allied Acquisition and the transactions
contemplated hereby without the occurrence of any default under, conflict with
or violation of (A) any applicable law, rule, regulation, order or decree of any
Governmental Authority or arbitral authority or
(B) any agreement, document or instrument to which any of the Loan Parties
is a party or by which any of them or their properties is bound;
(iv) BREED and its Subsidiaries shall be in compliance with all existing
material financial obligations;
(v) there shall not have been any material amendment, modification or
waiver of any of the terms or conditions of the Asset Purchase Agreement without
consent of the Agent; and
(vi) immediately after giving effect to the Allied Acquisition, there shall
be not less than $75,000,000 under the terms of the Revolving Credit Facility
available for working capital purposes, excluding Letters of Credit issued
pursuant to Article III.
6.2. Conditions of all Loans and Letters of Credit. The obligations of the
Lenders to make any Loans, and the Issuing Bank to issue Letters of Credit,
hereunder on or subsequent to the Closing Date are subject to the satisfaction
of the following conditions:
(a) the Agent shall have received a Borrowing Notice if required by Article
II;
(b) the representations and warranties of the Loan Parties set forth in
Article VII and in each of the other Loan Documents shall be true and correct in
all material respects on and as of the date of such Advance or Letter of Credit
issuance or renewal, with the same effect as though such representations and
warranties had been made on and as of such date, except to the extent that such
representations and warranties expressly relate to an earlier date and except
that the financial statements referred to in Section 7.6(a) shall be deemed to
be those financial statements most recently delivered to the Agent and the
Lenders pursuant to Section 8.1 and except as otherwise permitted hereunder from
the date financial statements are delivered to the Agent and the Lenders in
accordance with such Section;
(c) in the case of the issuance of a Letter of Credit, the applicable
Borrower or Borrowers shall have executed and delivered to the Issuing Bank an
Application and Agreement for Letter of Credit in form and content acceptable to
the Issuing Bank together with such other instruments and documents as it shall
request;
(d) at the time of (and after giving effect to) each Advance or the
issuance of a Letter of Credit, no Default or Event of Default specified in
Article X shall have occurred and be continuing; and
(e) immediately after giving effect to:
(i) a Loan, the aggregate principal balance of all outstanding Loans,
Participations and Reimbursement Obligations for each Lender shall not exceed
such Lender's Revolving Credit Commitment;
(ii) a Letter of Credit or renewal thereof, the aggregate principal balance
of all outstanding Participations in Letters of Credit and Reimbursement
Obligations (or in the case of the Issuing Bank, its remaining interest after
deduction of all Participations in Letters of Credit and Reimbursement
Obligations of other Lenders) for each Lender and in the aggregate shall not
exceed, respectively, (X) such Lender's Letter of Credit Commitment or (Y) the
Total Letter of Credit Commitment;
(iii) a Loan or Letter of Credit issued in an Alternative Currency, the
Dollar Value of Loans in Alternative Currencies shall not exceed the Total
Alternative Currency Sublimit; and
(iv) a Loan or a Letter of Credit or renewal thereof, the sum of Letter of
Credit Outstandings plus Revolving Credit Outstandings shall not exceed the
Total Revolving Credit Commitment.
ARTICLE VII
Representations and Warranties
Each Borrower represents and warrants with respect to itself and to its
Subsidiaries (which representations and warranties shall survive the delivery of
the documents mentioned herein and the making of Loans and the issuing of
Letters of Credit), that:
7.1. Organization and Authority.
(a) BREED and each Subsidiary is a corporation or partnership duly
organized and validly existing under the laws of the jurisdiction of its
formation;
(b) BREED and each Subsidiary (x) has the requisite power and authority to
own its properties and assets and to carry on its business as now being
conducted and as contemplated in the Loan Documents, and (y) is qualified to do
business in every jurisdiction in which the conduct of its business or ownership
of its assets requires it to be so qualified;
(c) BREED has the power and authority to execute, deliver and perform this
Agreement and the Notes, and to borrow hereunder, and to execute, deliver and
perform each of the other Loan Documents to which it is a party;
(d) Each Guarantor has the power and authority to execute, deliver and
perform the Guaranty and each of the other Loan Documents to which it is a
party; and
(e) When executed and delivered, each of the Loan Documents to which any
Loan Party is a party will be the legal, valid and binding obligation or
agreement of such Loan Party, enforceable against such Loan Party in accordance
with its terms, subject to the effect of any applicable bankruptcy, moratorium,
insolvency, reorganization or other similar law affecting the enforceability of
creditors' rights generally and to the effect of general principles of equity
(whether considered in a proceeding at law or in equity);
7.2. Loan Documents. The execution, delivery and performance by each Loan
Party of each of the Loan Documents to which it is a party:
(a) have been duly authorized by all requisite Organizational Action
(including any required shareholder or partner approval) of such Loan Party
required for the lawful execution, delivery and performance thereof;
(b) do not violate any provisions of (i) applicable law, rule or
regulation, (ii) any judgment, writ,
order, determination, decree or arbitral award of any Governmental
Authority or arbitral authority binding on such Loan Party or its properties, or
(iii) the Organizational Documents or Operating Documents of such Loan Party;
(c) does not and will not be in conflict with, result in a breach of or
constitute an event of default, or an event which, with notice or lapse of time
or both, would constitute an event of default, under any contract, indenture,
agreement or other instrument or document to which such Loan Party is a party,
or by which the properties or assets of such Loan Party are bound; and
(d) except as provided in the Security Instruments, does not and will not
result in the creation or imposition of any Lien upon any of the properties or
assets of such Loan Party or any Subsidiary;
7.3. Solvency. Each Loan Party is Solvent after giving effect to the
transactions contemplated by the Loan Documents;
7.4. Subsidiaries and Stockholders. BREED has no Subsidiaries other than
those Persons listed as Subsidiaries in Schedule 7.4 and additional Subsidiaries
created or acquired after the Closing Date in compliance with Section 8.19;
Schedule 7.4 states as of the date hereof the organizational form of each
entity, the authorized and issued capitalization of each Subsidiary listed
thereon, the number of shares or other equity interests of each class of capital
stock or interest issued and outstanding of each such Subsidiary and the number
and/or percentage of outstanding shares or other equity interest (including
options, warrants and other rights to acquire any interest) of each such class
of capital stock or other equity interest owned by BREED or by any such
Subsidiary; the outstanding shares or other equity interests of each such
Subsidiary have been duly authorized and validly issued and are fully paid and
nonassessable; and BREED and each such Subsidiary owns beneficially and of
record all the shares and other interests it is listed as owning in Schedule
7.4, free and clear of any Lien;
7.5. Ownership Interests. BREED owns no interest in any Person other than
the Persons listed in Schedule
7.4, Integrated Sensor Solutions, Inc. and the joint ventures described in
the agreements provided to the Agent pursuant to Section 6.1(a)(x), equity
investments in Persons not constituting Subsidiaries permitted under Section 9.6
and additional Subsidiaries created or acquired after the Closing Date in
compliance with Section 8.19;
7.6. Financial Condition.
(a) BREED has heretofore furnished to each Lender (i) an audited
consolidated balance sheet of BREED and its Subsidiaries as at June 30, 1997 and
the notes thereto and the related consolidated statements of income,
stockholders' equity and cash flows for the Fiscal Year then ended as examined
and certified by Ernst & Young, LLP and (ii) an unaudited consolidated interim
statement of income of BREED and its Subsidiaries as of July 31, 1997. Except as
set forth therein, such financial statements (including the notes thereto in the
case of the audited statements) present fairly the financial condition of BREED
and its Subsidiaries as of the end of such Fiscal Year and one month period and
results of their operations for the Fiscal Year and interim period then ended
and the changes in its stockholders' equity for the Fiscal Year then ended, all
in conformity with GAAP applied on a Consistent Basis, subject however, in the
case of unaudited interim statements to year end audit adjustments;
(b) since June 30, 1997 there has been no material adverse change in the
condition, financial or otherwise, of BREED or any of its Subsidiaries or in the
businesses, properties, performance, prospects or operations of BREED or its
Subsidiaries, nor have such businesses or properties been materially adversely
affected as a result of any fire, explosion, earthquake, accident, strike,
lockout, combination of workers, flood, embargo or act of God; and
(c) except as set forth in the financial statements referred to in Section
7.6(a) or in Schedule 7.6 or permitted by Section 9.4, neither BREED nor any
Subsidiary has incurred, other than in the ordinary course of business, any
Indebtedness, or other commitment or liability which remains outstanding or
unsatisfied;
7.7. Title to Properties. BREED and each of its Subsidiaries has title to
all its real and personal properties, subject to no transfer restrictions or
Liens of any kind, except with respect to the real property subject to the
Mortgages, the Permitted Encumbrances as defined in each of the Mortgages, and
with respect to the other real and personal properties, the transfer
restrictions and Liens described in Schedule 7.7 and Liens permitted by Section
9.3;
7.8. Taxes. BREED and each of its Subsidiaries has filed or caused to be
filed all federal, state and local tax returns which are required to be filed by
it and, except for taxes and assessments being contested in good faith by
appropriate proceedings diligently conducted and against which reserves
reflected in the financial statements described in Section 7.6(a) and
satisfactory to BREED's independent certified public accountants have been
established, have paid or caused to be paid all taxes as shown on said returns
or on any assessment received by it, to the extent that such taxes have become
due and the failure of which would reasonably be expected to have a Material
Adverse Effect;
7.9. Other Agreements. No Loan Party nor any Subsidiary is
(a) a party to or subject to any judgment, order, decree, agreement, lease
or instrument, or subject to other restrictions, which individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect;
(b) in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement or instrument
(including the Asset Purchase Agreement) to which BREED or any Subsidiary is a
party, which default has, or if not remedied within any applicable grace period
could reasonably be likely to have, a Material Adverse Effect; or
(c) a party to or bound by any agreement with any other Person (other than
the Agent and the Lenders pursuant to this Agreement or any other Loan Document)
which prohibits, limits or restricts the ability of any Subsidiary to make any
payments, directly or indirectly, to BREED by way of dividends, advances,
repayments of loans or advances, or other returns on investments, or by any
other agreement or arrangement which restricts the ability of any Subsidiary to
make any payment, directly or indirectly, to BREED.
7.10. Litigation. Except as set forth in Schedule 7.10, there is no action,
suit, investigation or proceeding at law or in equity or by or before any
governmental instrumentality or agency or arbitral body pending, or, to the best
knowledge of the Borrowers, threatened by or against BREED or any Subsidiary or
affecting BREED or any Subsidiary or any properties or rights of BREED or any
Subsidiary, which could reasonably be expected to
have a Material Adverse Effect;
7.11. Margin Stock. The proceeds of the borrowings made hereunder will be
used by the Borrowers only for the purposes expressly authorized herein. None of
such proceeds will be used, directly or indirectly, for the purpose of
purchasing or carrying any margin stock or for the purpose of reducing or
retiring any Indebtedness which was originally incurred to purchase or carry
margin stock or for any other purpose which might constitute any of the Loans
under this Agreement a "purpose credit" within the meaning of said Regulation U
or Regulation X (12 C.F.R. Part 224) of the Board. Neither the Borrowers nor any
agent acting in their behalf has taken or will take any action which might cause
this Agreement or any of the documents or instruments delivered pursuant hereto
to violate any regulation of the Board or to violate the Securities Exchange Act
of 1934, as amended, or the Securities Act of 1933, as amended, or any state
securities laws, in each case as in effect on the date hereof;
7.12. Investment Company. No Loan Party is 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 (15 U.S.C. ss. 80a-1, et seq.). The application of the proceeds
of the Loans and repayment thereof by the Borrowers and the performance by the
Loan Parties of the transactions contemplated by the Loan Documents will not
violate any provision of said Act, or any rule, regulation or order issued by
the Securities and Exchange Commission thereunder, in each case as in effect on
the date hereof;
7.13. Patents, Etc. BREED and each Subsidiary owns or has the right to use,
under valid license agreements or otherwise, all material patents, licenses,
franchises, trademarks, trademark rights, trade names, trade name rights, trade
secrets and copyrights necessary to or used in the conduct of its businesses as
now conducted and as contemplated by the Loan Documents, in all cases without
known conflict with any patent, license, franchise, trademark, trade secret,
trade name, copyright, other proprietary right of any other Person, which
conflict is reasonably likely to have a Material Adverse Effect;
7.14. No Untrue Statement. Neither (a) this Agreement nor any other Loan
Document or certificate or document executed and delivered by or on behalf of
BREED or any Subsidiary in accordance with or pursuant to any Loan Document nor
(b) any statement, representation, or warranty provided to the Agent in
connection with the negotiation or preparation of the Loan Documents contains
any misrepresentation or untrue statement of material fact or omits to state a
material fact necessary, in light of the circumstance under which it was made,
in order to make any such warranty, representation or statement contained
therein not misleading;
7.15. No Consents, Etc. Neither the respective businesses or properties of
the Loan Parties or any Subsidiary, nor any relationship among the Loan Parties
or any Subsidiary and any other Person, nor any circumstance in connection with
the execution, delivery and performance of the Loan Documents and the
transactions contemplated thereby, is such as to require a consent, approval or
authorization of, or filing, registration or qualification with, any
Governmental Authority or any other Person on the part of any Loan Party or any
Subsidiary as a condition to the execution, delivery and performance of, or
consummation of the transactions contemplated by the Loan Documents, including,
without limitation, the Allied Acquisition (other than the consents identified
in the Asset Purchase Agreement), or if so, such consent (and in the case of the
Allied Acquisition the Required Consents, as defined in the Asset Purchase
Agreement), approval, authorization, filing, registration or qualification has
been duly obtained or effected, or shall have been obtained or effected prior to
the Closing Date, as the case may be;
7.16. Employee Benefit Plans.
(a) BREED, each ERISA Affiliate and each Subsidiary is in compliance with
all applicable provisions of ERISA, the Code and the regulations and published
interpretations thereunder and in compliance with all Foreign Benefit Laws and
the regulations and published interpretations thereunder with respect to all
Employee Benefit Plans, except for any required amendments for which the
remedial amendment period as defined in Section 401(b) of the Code has not yet
expired. Each Employee Benefit Plan that is intended to be qualified under
Section 401(a) of the Code has been determined or BREED or its Subsidiaries is
in the process of obtaining a determination by the Internal Revenue Service to
be so qualified, each trust related to such plan has been determined to be
exempt under Section 501(a) of the Code, and each Employee Benefit Plan subject
to any Foreign Benefit Law has received the required approvals by any
Governmental Authority regulating such Employee Benefit Plan. No material
liability has been incurred by BREED or any ERISA Affiliate which remains
unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan
or any Multiemployer Plan;
(b) Neither BREED, any ERISA Affiliate nor any Subsidiary has (i) engaged
in a nonexempt prohibited transaction described in Section 4975 of the Code or
Section 406 of ERISA affecting any of the Employee Benefit Plans or the trusts
created thereunder which could subject any such Employee Benefit Plan or trust
to a material tax or penalty on prohibited transactions imposed under Internal
Revenue Code Section 4975 or ERISA, (ii) incurred any accumulated funding
deficiency with respect to any Employee Benefit Plan, whether or not waived, or
any other material liability to the PBGC which remains outstanding other than
the payment of premiums and there are no premium payments which are due and
unpaid, (iii) failed to make a required contribution or payment to a
Multiemployer Plan, (iv) failed to make a required installment or other required
payment under Section 412 of the Code, Section 302 of ERISA or the terms of such
Employee Benefit Plan, or (v) failed to make a required contribution or payment,
or otherwise failed to operate in compliance with any Foreign Benefit Law
regulating any Employee Benefit Plan;
(c) No Termination Event has occurred or is reasonably expected to occur
with respect to any Employee Benefit Plan except for the hourly represented
retirement plans of BREED's Grabill, Indiana and Niles, Michigan facilities, and
neither BREED nor any ERISA Affiliate has incurred any unpaid withdrawal
liability with respect to any Multiemployer Plan;
(d) The present value of all vested accrued benefits under each Employee
Benefit Plan which is subject to Title IV of ERISA or whose funding is regulated
by any Foreign Benefit Law, did not, as of the most recent valuation date for
each such plan, exceed the then current value of the assets of such Employee
Benefit Plan allocable to such benefits;
(e) To the best of BREED's knowledge, each Employee Benefit Plan subject to
Title IV of ERISA or the funding of which is regulated by any Foreign Benefit
Law, maintained by BREED, any ERISA Affiliate or any Subsidiary, has been
administered in accordance with its terms in all material respects and is in
compliance in all material respects with all applicable requirements of ERISA,
all Foreign Benefit Laws, and other applicable laws, regulations and rules;
(f) The consummation of the Loans and the issuance of the Letters of Credit
provided for herein will not involve any prohibited transaction under ERISA
which is not subject to a statutory or administrative
exemption; and
(g) No material proceeding, claim, lawsuit and/or investigation exists or,
to the best knowledge of BREED after due inquiry, is threatened concerning or
involving any Employee Benefit Plan;
7.17. No Default. As of the date hereof, there does not exist any Default
or Event of Default hereunder;
7.18. Environmental Matters. BREED and each Subsidiary is in compliance
with all applicable Environmental Laws in all material respects and has been
issued and currently maintains or is pursuing all required federal, state, local
and foreign permits, licenses, certificates and approvals. Neither BREED nor any
Subsidiary has been notified of any pending or threatened action, suit,
proceeding or investigation which, and neither BREED nor any Subsidiary is aware
of any facts which, (i) calls into question, or could reasonably be expected to
call into question, compliance by BREED or any Subsidiary with any Environmental
Laws, (ii) which seeks, or could reasonably be expected to form the basis of a
meritorious proceeding, to suspend, revoke or terminate any license, permit or
approval necessary for the generation, handling, storage, treatment or disposal
of any Hazardous Material or the operation of BREED's or any Subsidiary's
business or facility, or (iii) seeks to cause, or could reasonably be expected
to form the basis of a meritorious proceeding to cause, any property of BREED or
any Subsidiary to be subject to any restrictions on ownership, use, occupancy or
transferability under any Environmental Law, which in any of the foregoing
instances would reasonably be expected to have a Material Adverse Effect;
7.19. Employment Matters. (a) Except as set forth in Schedule 7.19, none of
the employees of BREED or any Subsidiary is subject to any collective bargaining
agreement and there are no strikes, work stoppages, election or decertification
petitions or proceedings, unfair labor charges, equal opportunity proceedings,
or other material labor/employee related controversies or proceedings pending
or, to the best knowledge of BREED, threatened against BREED or any Subsidiary
or between BREED or any Subsidiary and any of its employees, other than (in each
of the foregoing cases) employee grievances arising in the ordinary course of
business which could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect;
(b) Except to the extent a failure to maintain compliance would not have a
Material Adverse Effect, BREED and each Subsidiary is in compliance in all
material respects with all applicable laws, rules and regulations pertaining to
labor or employment matters, including without limitation those pertaining to
wages, hours, occupational safety and taxation and there is neither pending or,
to the knowledge of BREED, threatened any litigation, administrative proceeding
nor, to the knowledge of BREED, any investigation, in respect of such matters
which, if decided adversely, could reasonably be likely, individually or in the
aggregate, to have a Material Adverse Effect;
7.20. RICO. Neither BREED nor any Subsidiary is engaged in or has engaged
in any course of conduct that could subject any of their respective properties
to any Lien, seizure or other forfeiture under any criminal law, racketeer
influenced and corrupt organizations law, civil or criminal, or other similar
laws;
7.21. Allied Acquisition Representations. On the Closing Date, each of the
representations and warranties contained in Article 6 of the Asset Purchase
Agreement, including all Exhibits and Schedules referenced therein and all
definitions of defined terms referenced therein and all disclosures of Allied
contained therein, are incorporated herein by reference and given by BREED as of
the Closing Date;
7.22. Allied Acquisition. All conditions precedent to the consummation of
the Allied Acquisition as set forth in the Asset Purchase Agreement and other
Acquisition Documents have been satisfied and not waived without the approval of
the Agent (which approval shall not be unreasonably withheld) including all
Required Consents (as defined in the Asset Purchase Agreement) and approvals of
third parties and upon the tendering of the cash proceeds from the Revolving
Credit Facility, the Allied Acquisition shall be effective;
7.23. Perfected Security Instruments. (a) At all times after execution and
delivery of each Pledge Agreement by the Pledgor thereunder and satisfaction of
the conditions set forth in Section 6.1, the security interests created in favor
of the Agent for the benefit of the Lenders under the Pledge Agreements will
constitute valid, perfected security interests in the Pledged Stock and Assigned
Interests, subject to no other Liens;
(b) At all times after execution and delivery of each Security Instrument
(other than the Pledge Agreements) by the parties thereto and completion of the
filings and recordings listed on Schedule 7.23 hereto, the security interests
created in favor of the Agent for the benefit of the Lenders under the Security
Instruments (other than the Pledge Agreements) will constitute valid, perfected
security interests in the Collateral described therein, subject to no other
Liens whatsoever, except for Permitted Liens, and with respect to the Mortgages,
subject to no other Liens whatsoever, except for the Permitted Encumbrances as
defined in each of the Mortgages.
ARTICLE VIII
Affirmative Covenants
Until the Facility Termination Date, unless the Required Lenders shall
otherwise consent in writing, BREED will, and where applicable will cause each
Subsidiary to:
8.1. Financial Reports, Etc. (a) As soon as practical and in any event
within 90 days after the end of each Fiscal Year of BREED, deliver or cause to
be delivered to the Agent, together with sufficient copies for each Lender (i)
consolidated and consolidating (by major lines of business) balance sheets of
BREED and its Subsidiaries as at the end of such Fiscal Year, and the notes
thereto, and the related consolidated and consolidating statements of income,
stockholders' equity and cash flows, and the respective notes thereto, for such
Fiscal Year, setting forth comparative financial statements for the preceding
Fiscal Year, all prepared in accordance with GAAP applied on a Consistent Basis
and containing opinions (in the case of the consolidated statements) of Ernst &
Young LLP, or other such independent certified public accountants selected by
BREED and approved by the Agent, which are unqualified as to the scope of the
audit performed and as to the "going concern" status of BREED and its
Subsidiaries and without any exception not acceptable to the Required Lenders,
and (ii) a certificate of an Authorized Representative demonstrating compliance
with Sections 9.1(a) through 9.1(c), which certificate shall be in the form of
Exhibit T;
(b) as soon as practical and in any event within 45 days after the end of
each fiscal quarter (except the last fiscal quarter of the Fiscal Year), deliver
to the Agent together with sufficient copies for each Lender, (i) consolidated
and consolidating (by major line of business) balance sheets of BREED and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated
and consolidating statements of income and cash flows for such fiscal quarter
and for the period from the beginning of the then current Fiscal Year through
the end of such reporting period, and accompanied by a certificate of an
Authorized Representative to the effect that
such financial statements present fairly the financial position of BREED
and its Subsidiaries as of the end of such fiscal period and the results of
their operations and the changes in their financial position for such fiscal
period, in conformity with the standards set forth in Section 7.6(a) with
respect to interim financial statements, and (ii) a certificate of an Authorized
Representative containing computations for such quarter comparable to that
required pursuant to Section 8.1(a)(ii);
(c) as soon as practical and in any event within 30 days after the end of
each calendar month (except the last month of a fiscal quarter or Fiscal Year),
deliver to the Agent consolidated and consolidating (by major line of business)
balance sheets of BREED and its Subsidiaries as at the end of such calendar
month, and the related consolidated and consolidating statements of income and
cash flows for such calendar month and for the period from the beginning of the
then current Fiscal Year through the end of such month, and accompanied by a
certificate of an Authorized Representative to the effect that such financial
statements present fairly the results of operations of BREED and its
Subsidiaries as of the end of such calendar month and for such calendar month,
respectively, and the changes in their financial position for such period, in
conformity with the standards set forth in Section 7.6(a) with respect to
interim financial statements;
(d) together with each delivery of the financial statements required by
Section 8.1(a)(i), deliver to the Agent and each Lender a letter from BREED's
accountants specified in Section 8.1(a)(i) stating that in performing the audit
necessary to render an opinion on the financial statements delivered under
Section 8.1(a)(i), they obtained no knowledge of any Default or Event of Default
by the Borrowers in the fulfillment of the terms and provisions of this
Agreement insofar as they relate to financial matters (which at the date of such
statement remains uncured); or if the accountants have obtained knowledge of
such Default or Event of Default, a statement specifying the nature and period
of existence thereof; (e) promptly upon their becoming available to BREED, BREED
shall deliver to the Agent, together with sufficient copies for each Lender, a
copy of (i) all regular or special reports or effective registration statements
which BREED or any Subsidiary shall file with the Securities and Exchange
Commission (or any successor thereto) or any securities exchange, (ii) any proxy
statement distributed by BREED or any Subsidiary to its shareholders,
bondholders or the financial community in general, and (iii) any management
letter or other report submitted to BREED or any Subsidiary by independent
accountants in connection with any annual, interim or special audit of BREED or
any Subsidiary;
(f) promptly deliver or cause to be delivered to the Agent, written notice
of any event which constitutes or which with the passage of time or giving of
notice or both would constitute a default or event of default under any Material
Contract to which BREED or any of its Subsidiaries is a party or by which BREED
or any Subsidiary thereof or any of their respective properties may be bound;
(g) promptly, from time to time, deliver or cause to be delivered to the
Agent such other information regarding BREED's and any Subsidiary's operations,
business affairs and financial condition as the Agent may reasonably request;
Subject to Section 12.1(f), the Agent and the Lenders are hereby authorized
to deliver a copy of any such financial or other information delivered hereunder
to the Lenders (or any affiliate of any Lender) or to the Agent, to any
Governmental Authority having jurisdiction over the Agent or any of the Lenders
pursuant to any written request therefor or in the ordinary course of
examination of loan files, or to any other Person who shall acquire or consider
the assignment of, or acquisition of any participation interest in, any
Obligation permitted by
this Agreement provided that notice is given to BREED if such information
is delivered to a Person not enumerated herein;
8.2. Maintain Properties. Maintain all properties necessary to its
operations in good working order and condition, ordinary wear and tear excepted,
make all needed repairs, replacements and renewals to such properties, and
maintain free from Liens all trademarks, trade names, patents, copyrights, trade
secrets, know- how, and other intellectual property and proprietary information
(or adequate licenses thereto), in each case as are necessary to conduct its
business as currently conducted or as contemplated hereby, all in accordance
with customary and prudent business practices;
8.3. Existence, Qualification, Etc. Except as otherwise expressly permitted
under Section 9.7, do or cause to be done all things necessary to preserve and
keep in full force and effect its existence and all material rights and
franchises, and, except to the extent conveyed in connection with a transaction
permitted under Section 9.5 hereof, maintain its license or qualification to do
business as a foreign corporation and good standing in each jurisdiction in
which its ownership or lease of property or the nature of its business makes
such license or qualification necessary;
8.4. Regulations and Taxes. Comply in all material respects with or contest
in good faith all statutes and governmental regulations and pay all taxes,
assessments, governmental charges, claims for labor, supplies, rent and any
other obligation which, if unpaid, would become a Lien against any of its
properties except liabilities being contested in good faith by appropriate
proceedings diligently conducted and against which adequate reserves acceptable
to BREED's independent certified public accountants have been established unless
and until any Lien resulting therefrom attaches to any of its property and
becomes enforceable against the Lenders;
8.5. Insurance. (a) Keep all of its insurable properties adequately insured
at all times with responsible insurance carriers against loss or damage by fire
and other hazards, including containing provisions required by the Security
Instruments, (b) maintain general public liability insurance at all times with
responsible insurance carriers against liability on account of damage to persons
and property and (c) maintain insurance under all applicable workers'
compensation laws (or in the alternative, maintain required reserves if
self-insured for workers' compensation purposes) and against loss by reason of
business interruption such policies of insurance to have such limits,
deductibles, exclusions, co-insurance and other provisions providing no less
coverages than that specified in Schedule 8.5. Each of the policies of insurance
described in this Section 8.5 shall comply in all respects with the terms of the
Security Instruments;
8.6. True Books. Keep true books of record and account in which full, true
and correct entries will be made of all of its dealings and transactions, and
set up on its books such reserves as may be required by GAAP with respect to
doubtful accounts and all taxes, assessments, charges, levies and claims and
with respect to its business in general, and include such reserves in interim as
well as year-end financial statements;
8.7. Right of Inspection. Permit any representative designated by the Agent
or any Lender, to visit and inspect any of the properties, corporate books and
financial reports of BREED or any Subsidiary and to discuss its affairs,
finances and accounts with its principal officers and independent certified
public accountants, all at reasonable times, at reasonable intervals and with
reasonable prior notice and permit any Lender to discuss BREED's affairs,
finances and accounts with its principal officers and its independent
accountants all at reasonable times, at reasonable intervals and with reasonable
prior notice;
8.8. Observe all Laws. Conform to and duly observe in all material respects
all laws, rules and regulations and all other valid requirements of any
Governmental Authority with respect to the conduct of its business;
8.9. Governmental Licenses. Obtain and maintain all licenses, permits,
certifications and approvals of all applicable Governmental Authorities as are
required for the conduct of its business as currently conducted and as
contemplated by the Loan Documents;
8.10. Covenants Extending to Other Persons. Cause each of its Subsidiaries
to do with respect to itself, its business and its assets, each of the things
required of BREED in Sections 8.2 through 8.9, and 8.18 inclusive;
8.11. Officer's Knowledge of Default. Upon any Authorized Representative or
the General Counsel of BREED obtaining knowledge of any Default or Event of
Default hereunder or under any other obligation of BREED or any Subsidiary to
any Lender, or any event, development or occurrence which could reasonably be
expected to have a Material Adverse Effect, cause such officer or an Authorized
Representative to promptly notify the Agent of the nature thereof, the period of
existence thereof, and what action BREED or such Subsidiary proposes to take
with respect thereto;
8.12. Suits or Other Proceedings. Upon any Authorized Representative or the
General Counsel of BREED obtaining knowledge of any litigation or other
proceedings being instituted against BREED or any Subsidiary or any attachment,
levy, execution or other process being instituted against any assets of BREED or
any Subsidiary making a claim or claims which is likely to result in damages in
an aggregate amount greater than $10,000,000 not otherwise covered by insurance,
or could reasonably be expected to have a Material Adverse Effect, promptly
deliver to the Agent written notice thereof stating the nature and status of
such litigation, dispute, proceeding, levy, execution or other process;
8.13. Notice of Environmental Complaint or Condition. Promptly provide to
the Agent true, accurate and complete copies of any and all notices, complaints,
orders, directives, claims, or citations received by BREED or any Subsidiary
relating to any (a) violation or alleged violation by BREED or any Subsidiary of
any applicable Environmental Law; (b) release or threatened release by BREED or
any Subsidiary, or at any facility or property owned or leased or operated by
BREED or any Subsidiary or by any Person handling, transporting, or disposing of
any Hazardous Material on behalf of BREED or any Subsidiary, of any Hazardous
Material, except where occurring legally; or (c) liability or alleged liability
of BREED or any Subsidiary for the costs of cleaning up, removing, remediating
or responding to a release of Hazardous Materials, which in any of the foregoing
instances would reasonably be expected to have a Material Adverse Effect;
8.14. Environmental Compliance. If BREED or any Subsidiary shall receive
any letter, notice, complaint, order, directive, claim or citation alleging that
BREED or and Subsidiary has violated any Environmental Law, has released any
Hazardous Material or is liable for the costs of cleaning up, removing,
remediating or responding to a release of Hazardous Materials, which in any of
the foregoing instances would reasonably be expected to have a Material Adverse
Effect, BREED shall, within the time period permitted by the applicable
Environmental Law or the Governmental Authority responsible for enforcing such
Environmental Law, either (i) remove or remedy, or cause the applicable
Subsidiary to remove or remedy, such violation or release or satisfy such
liability or (ii) contest in good faith such violation so long as no remedial
action shall be required to be taken during the period of such contest;
8.15. Indemnification. Without limiting the generality or application of
Section 12.9, BREED hereby agrees to indemnify and hold the Agent, the Lenders
and NMSI, and their respective officers, directors, employees and agents,
harmless from and against any and all claims, losses, penalties, liabilities,
damages and expenses (including assessment and cleanup costs and reasonable
attorneys' fees and disbursements) arising directly or indirectly from, out of
or by reason of (a) the violation of any Environmental Law by BREED or any
Subsidiary or with respect to any property owned, operated or leased by BREED or
any Subsidiary or (b) the handling, storage, treatment, emission or disposal of
any Hazardous Materials by or on behalf of BREED or any Subsidiary or on or with
respect to property owned or leased or operated by BREED or any Subsidiary. The
provisions of this Section 8.15 shall survive the Facility Termination Date and
expiration or termination of this Agreement;
8.16. Further Assurances. At the Borrowers' cost and expense, upon request
of the Agent, duly execute and deliver or cause to be duly executed and
delivered, to the Agent such further instruments, documents, certificates,
financing and continuation statements, and do and cause to be done such further
acts that may be reasonably necessary or advisable in the reasonable opinion of
the Agent to carry out more effectively the provisions and purposes of this
Agreement and the other Loan Documents;
8.17 Employee Benefit Plans.
(a) With reasonable promptness, and in any event within thirty (30) days
thereof, give notice to the Agent of (a) the establishment of any new Employee
Benefit Plan (which notice shall include a summary of such plan), (b) the
commencement of contributions to any Employee Benefit Plan to which BREED, any
of its ERISA Affiliates or any of its Subsidiaries was not previously
contributing, (c) any material increase in the benefits of any existing Employee
Benefit Plan, (d) each funding waiver request filed with respect to any Employee
Benefit Plan and all communications received or sent by BREED, any ERISA
Affiliate or any Subsidiary with respect to such request and (e) the failure of
BREED or any ERISA Affiliate or any Subsidiary to make a required installment or
payment under Section 302 of ERISA or Section 412 of the Code (in the case of
Employee Benefit Plans regulated by the Code or ERISA) or any Foreign Benefit
Law (in the case of any Employee Benefit Plan regulated by any Foreign Benefit
Law) by the due date;
(b) Promptly and in any event within fifteen (15) days of becoming aware of
the occurrence or forthcoming occurrence of any (a) Termination Event or (b)
nonexempt "prohibited transaction," as such term is defined in Section 406 of
ERISA or Section 4975 of the Code, in connection with any Pension Plan or any
trust created thereunder, deliver to the Agent a notice specifying the nature
thereof, what action BREED, any ERISA Affiliate or any Subsidiary has taken, is
taking or proposes to take with respect thereto and, when known, any action
taken or threatened by the Internal Revenue Service, the Department of Labor,
the PBGC or any other Governmental Authority with respect thereto; and
(c) With reasonable promptness but in any event within fifteen (15) days
for purposes of clauses (a), (b) and (c), deliver to the Agent copies of (a) any
unfavorable determination letter from the Internal Revenue Service regarding the
qualification of an Employee Benefit Plan under Section 401(a) of the Code, (b)
all notices received by BREED or any ERISA Affiliate or any Subsidiary of the
PBGC's or any Governmental Authority's intent to terminate any Employee Benefit
Plan or to have a trustee appointed to administer any Pension Plan, (c) each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed
by BREED or any ERISA Affiliate with the Internal Revenue Service with respect
to each Employee Benefit Plan
and (d) all notices received by BREED or any ERISA Affiliate from a
Multiemployer Plan sponsor concerning the imposition or amount of withdrawal
liability pursuant to Section 4202 of ERISA. BREED will notify the Agent in
writing within five (5) Business Days of BREED or any ERISA Affiliate obtaining
knowledge or reason to know that BREED or any ERISA Affiliate has filed or
intends to file a notice of intent to terminate any Pension Plan under a
distress termination within the meaning of Section 4041(c) of ERISA;
8.18. Continued Operations. Except as permitted under Section 9.12,
continue at all times to conduct its business and engage principally in the same
or complementary line or lines of business substantially as heretofore
conducted;
8.19 Additional Support Documents. Within thirty (30) days (or such
additional amount of time as is reasonably necessary in the case of a Foreign
Subsidiary but in no event more than ninety (90) days) of the acquisition or
creation of any Domestic Subsidiary or Direct Foreign Subsidiary or any
Subsidiary of a Borrowing Subsidiary cause to be delivered to the Agent for the
benefit of the Lenders each of the following:
(a) in the case of a Domestic Subsidiary,
(i) a Guaranty executed by such Domestic Subsidiary substantially in the
form of Exhibit G hereto;
(ii) a Security Agreement executed by such Domestic Subsidiary
substantially in the form of Exhibit R hereto;
(iii) if applicable, to the extent consented to by any necessary third
party, Landlord Waivers (in the form of Exhibit L), Lease Assignments (in the
form of Exhibit N), Mortgages, an Intellectual Property Security Agreement (in
the form of Exhibit H), and an Intercompany Note Pledge Agreement (in the form
of Exhibit Q);
(b) (i) in the case that such Subsidiary is directly owned by BREED or a
Domestic Subsidiary or a Borrowing Subsidiary which has previously delivered a
Pledge Agreement, Exhibit A and a revised Schedule I to the Pledge Agreement
dated the date hereof together with (x) stock certificates or other appropriate
evidence of ownership representing 100% of the capital stock and related
interests and rights of a Domestic Subsidiary and a Subsidiary of a Borrowing
Subsidiary or (y) not less than 65% of the Voting Stock and 100% of the
non-voting common stock and related interests and rights of any Direct Foreign
Subsidiary and (z) duly executed stock powers or powers of assignment in blank
affixed thereto;
(ii) in the case that such Subsidiary is directly owned by a Domestic
Subsidiary which has not previously delivered a Pledge Agreement, a Pledge
Agreement substantially similar in form and content to that executed and
delivered by certain Domestic Subsidiaries on the Closing Date, with appropriate
revisions as to the identity of the pledgor and as required by applicable law,
if such Subsidiary is a Foreign Subsidiary, and securing Obligations of such
Pledgor under its Guaranty, together with (x) stock certificates or other
appropriate evidence of ownership representing 100% of the capital stock and
related interests and rights of a Domestic Subsidiary or (y) not less than 65%
of the Voting Stock and 100% of the non-voting common stock and related
interests and rights of any Direct Foreign Subsidiary (z) duly executed stock
powers or powers of assignment in blank affixed thereto or a Certificate and
Receipt of Registrar; or
(c) in the case that such Subsidiary is a partnership that has not issued
certificates evidencing ownership of such partnership or joint venture, the
Collateral Assignment of Partnership Interests and Certificate and Receipt of
Registrar of such partnership or such joint venture with respect to the
registration of the Lien on Assigned Interests so long as such assignment is not
prohibited by the Governing Documents of such partnership or joint venture;
(d) an opinion of counsel to the Subsidiary dated as of the date of
delivery of the Guaranty and other Loan Documents provided for in this Section
8.19and addressed to the Agent and the Lenders, in form and substance
substantially identical to the opinion of counsel delivered pursuant to Section
6.1(a)(ii) hereof on the Closing Date with respect to each Loan Party which is
party to any Loan Document which such newly acquired or created Subsidiary is
required to deliver or cause to be delivered pursuant to subparagraphs (a), (b),
or (c) above.
(e) current copies of the Organizational Documents and Operating Documents
of such Subsidiary, minutes of duly called and conducted meetings (or duly
effected consent actions) of the Board of Directors, partners, or appropriate
committees thereof (and, if required by such Organizational Documents or
Operating Documents, of the shareholders) of such Subsidiary authorizing the
actions and the execution and delivery of documents described in this Section
8.19.
8.20. Operating Plan. As soon as practical and in any event within 90 days
after the Closing Date, BREED shall deliver to the Agent a copy of the Operating
Plan; provided, however, that if at any time before the Facility Termination
Date, management of BREED determines that the forecasts of the Operating Plan no
longer accurately reflect the current projected financial results of BREED and
its Subsidiaries, as promptly as practicable after such determination date and
in any event within 30 days of the end of the fiscal quarter for which such
determination was made, BREED shall deliver to the Agent a revised Operating
Plan;
8.21. Allied Acquisition Audit. As soon as practical and in any event
within 45 days after the Closing Date, BREED shall deliver to the Agent a copy
of an audit of the Acquired Business for the three (3) years ending December 31,
1996 conducted by Price Waterhouse, LLP and unaudited financial statements as of
September 30, 1997; and within 95 days after the initial Advance, unaudited
financial statements as of the date of the initial Advance. Notwithstanding the
foregoing, AlliedSignal's failure to provide such statements, without fault of
BREED, shall not constitute an Event of Default;
8.22. Diligent Pursuit of Waiver. BREED shall use its best efforts to
obtain a waiver of the limitations set forth in the letter dated August 26, 1996
to BREED from the Securities and Exchange Commission;
8.23. Swap Agreements. Not later than thirty (30) days following the
Closing Date, the Borrowers shall enter into interest rate protection agreements
containing terms and conditions acceptable to BREED and the Agent providing Rate
Hedging Obligations which limit the risk of interest rate fluctuations in a
notional amount of not less than (i) $300,000,000 or (ii) in the event that
Outstandings are less than $300,000,000, fifty percent (50%) of all
Outstandings;
8.24. Subsidiary Support of Permitted Indebtedness. So long as not
prohibited by law, BREED and each Subsidiary shall cause each of their
Subsidiaries to make cash payments, directly or indirectly, to the Borrowers by
way of dividends, advances, repayments of loans or advances, or other returns on
investments, or by way of
any other arrangement such that the Borrowers shall have the ability to
satisfy all interest and principal payments required under the terms of this
Agreement or any other Loan Document and under the terms of any other Permitted
Indebtedness.
8.25. Convertible Debentures.
(a) The Convertible Preferred Securities Issuance shall have occurred
within 180 days of the Closing Date.
(b) In the event any distribution with respect to the Convertible
Debentures would give rise to an Event of Default, promptly give the BTI Trust
notice of the election by BREED to defer such distribution until payment in full
of the Obligations.
8.26 Management. Cause the Person occupying the office of (i) Vice Chairman
of the Board of Directors, (ii) President and Chief Operating Officer, and (iii)
Executive Vice President of Operations Worldwide to remain in such office,
except for reason of death or disability.
ARTICLE IX
Negative Covenants
Until the Facility Termination Date, unless the Required Lenders shall
otherwise consent in writing, BREED will not, nor will it permit any Subsidiary
to:
9.1. Financial Covenants.
(a) Consolidated Shareholder's Equity. Permit Consolidated Shareholder's
Equity to be less than the following: (i) ninety percent (90%) of the pro-forma
Consolidated Shareholders' Equity of BREED and its Subsidiaries and the Acquired
Business as set forth in the Form 8-K filed with the Securities and Exchange
Commission as a result of the completion of the Allied Acquisition, less
(ii) the sum of:
(A) All after tax charges related to the restructure plan announced in the
second quarter of Fiscal Year 1998, as approved by the Agent, plus
(B) All after tax charges for disruption costs directly related to the
aforementioned restructure plan, as approved by the Agent, plus
(C) All after tax fees and expenses, including financing fees, that are
related to the Allied Acquisition, as approved by the Agent, plus
(D) After tax charges for the write off of in process R&D of the Acquired
Business, as approved by the Agent, plus
(E) Cash Dividends on either the Convertible Preferred Securities or the
Series B Preference Shares so long as the Convertible Preferred Securities have
not been issued, plus
(F) Cash dividends paid to common stockholders on or about November 4,
1997;
plus
(iii) the sum of:
(A) Ninety percent (90%) of Consolidated Net Income (with no reduction for
losses), plus
(B) One hundred percent (100%) of the Net Proceeds of any Equity Offering.
(iv) The foregoing calculation, (i) - (ii) + (iii) shall be exclusive of
the effects of any foreign currency translation amounts after September 30,
1997.
(b) Consolidated EBITDA. Permit at any time during the respective periods
set forth below Consolidated EBITDA (less those items described in Section 9.1
(a)(ii)(A)(B) and (D)) to be less than that set forth opposite each such period:
Period Amount
Three months ending December 31, 1997 $25,000,000
Six months ending March 31, 1997 $64,000,000
Nine months ending June 30, 1998 $107,000,000
(c) Limitation on Capital Expenditures. Make Capital Expenditures which
exceed during the respective periods set forth below (on a cumulative basis) the
amount set forth opposite each such period:
Period Amount
Three months ending December 31, 1997 $17,000,000
Six months ending March 31, 1998 $37,000,000
Nine months ending June 30, 1998 $57,000,000
9.2. Acquisitions. Enter into any agreement, contract, binding commitment
or other arrangement providing for any Acquisition, or take any action to
solicit the tender of securities or proxies in respect thereof in order to
effect any Acquisition.
9.3. Liens. Incur, create or permit to exist any Lien, charge or other
encumbrance of any nature whatsoever with respect to any property or assets now
owned or hereafter acquired by BREED or any Subsidiary, other than Liens created
in favor of the Agent and the Lenders under the Loan Documents and the following
(collectively, the "Permitted Liens"):
(a) Liens existing as of the date hereof and as set forth in Schedule 7.7;
(b) Liens imposed by law for taxes, assessments or charges of any
Governmental Authority for claims not yet due or which are being contested in
good faith by appropriate proceedings diligently conducted and with respect to
which adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP.
(c) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other Liens imposed by law or created in the ordinary
course of business and in existence less than 90 days from the date of creation
thereof for amounts not yet due or which are being contested in good faith by
appropriate proceedings diligently conducted and with respect to which adequate
reserves or other appropriate provisions are being maintained in accordance with
GAAP;
(d) Liens incurred or deposits made in the ordinary course of business
(including, without limitation, surety bonds and appeal bonds) in connection
with workers' compensation, unemployment insurance and other types of social
security benefits or to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of Indebtedness), statutory obligations
and other similar obligations or arising as a result of progress payments under
government contracts;
(e) purchase money Liens to secure Indebtedness permitted under Section
9.4(e) and incurred to purchase fixed assets, provided such Indebtedness
represents not less than 75% and not more than 100% of the purchase price of
such assets as of the date of purchase thereof and no property other than the
assets so purchased secured such Indebtedness;
(f) Liens arising in connection with Capital Leases permitted under Section
9.4(f) provided that no such Lien shall extend to any Collateral or to any other
property other than the assets subject to such Capital Leases;
(g) easements (including reciprocal easement agreements and utility
agreements), rights-of-way, covenants, consents, reservations, encroachments,
variations and zoning and other restrictions, charges or encumbrances (whether
or not recorded), which do not interfere materially with the ordinary conduct of
the business of BREED or any Subsidiary and which do not materially detract from
the value of the property to which they attach or materially impair the use
thereof to BREED or any Subsidiary;
9.4. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, howsoever evidenced, except the following (collectively the
"Permitted Indebtedness"):
(a) Indebtedness existing as of the Closing Date as set forth in Schedule
7.6; provided the outstanding amount of such Indebtedness shall not at any time
exceed $100,000,000 in the aggregate; provided, further, none of the instruments
and agreements evidencing or governing such Indebtedness shall be amended,
modified or supplemented after the Closing Date to change any terms of
subordination, repayment or rights of conversion, put, exchange or other rights
from such terms and rights as in effect on the Closing Date;
(b) Indebtedness owing to the Agent or any Lender in connection with this
Agreement, any Note or other Loan Document;
(c) Indebtedness required under Section 8.23;
(d) the endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business;
(e) purchase money Indebtedness in an aggregate amount not to exceed
$10,000,000 at any time;
(f) Capital Leases (i) with respect to the construction and equipping of
the VT1 FAB2 Facility in Finland in an aggregate amount not to exceed
$10,000,000 at any time and (ii) other than described in clause (i) above in an
aggregate principal amount not to exceed $10,000,000 at any time;
(g) Intercompany Advances; and
(h) Guaranties of Indebtedness permitted hereunder of Guarantors and Direct
Foreign Subsidiaries., and the limited guaranty of the Convertible Preferred
Securities.
9.5. Transfer of Assets. Sell, lease, transfer or otherwise dispose of any
assets of BREED or any Subsidiary other than:
(a) dispositions of assets in the ordinary course of business; (b)
dispositions of property that is substantially worn, damaged, obsolete or, in
the judgment of BREED, no longer best used or useful in its business (including
Xxxxxxx Plasturgia S.r.l.) or that of any Subsidiary;
(c) transfers of assets necessary to give effect to investment or merger or
consolidation transactions permitted by Sections 9.6 and 9.7.
(d) after the Agent has approved the Operating Plan, dispositions described
therein.
9.6. Investments. Purchase, own, invest in or otherwise acquire, directly
or indirectly, any stock or other securities, or make or permit to exist any
interest whatsoever in any other Person or permit to exist any loans or advances
to any Person, except that BREED and its Subsidiaries may maintain investments
or invest in:
(a) any Person acquired in an Acquisition permitted hereunder;
(b) Eligible Securities;
(c) investments, including joint ventures, existing as of the date hereof
and as set forth in Schedule 7.4 and the Siemens joint venture referred to in
Section 9.6(h);
(d) accounts receivable arising and trade credit granted in the ordinary
course of business and any securities received in satisfaction or partial
satisfaction thereof in connection with accounts of financially troubled Persons
to the extent reasonably necessary in order to prevent or limit loss;
(e) Intercompany Advances;
(f) investments in Guarantors formed for the purpose of an Equity Offering
or a Debt Offering;
(g) loans and advances to employees in the ordinary course of business in
an aggregate amount not to exceed $4,000,000;
(h) non-cash investments in a joint venture with Siemens AG or a subsidiary
thereof not to exceed in the aggregate $20,000,000;
(i) other investments in joint ventures, the BTI Trust and minority
interest investments in an aggregate amount not to exceed $1,000,000;
(j) advances to Foreign Subsidiaries who are not Borrowing Subsidiaries nor
Direct Foreign Subsidiaries in
an aggregate amount not to exceed $1,000,000; and
(k) investments in BTI Trust of up to 3% of the principal amount of the
Convertible Preferred Securities.
9.7. Merger or Consolidation. (a) Consolidate with or merge into any other
Person, or (b) permit any other Person to merge into it; provided, however, (i)
any Subsidiary of BREED may merge or transfer all or substantially all of its
assets into or consolidate with its parent, a Guarantor, a Borrowing Subsidiary,
or BREED, and (ii) any other Person may merge into or consolidate with BREED or
any wholly-owned Subsidiary and any Subsidiary may merge into or consolidate
with any other Person in order to consummate an Acquisition permitted by Section
9.2, provided further, that any resulting or surviving entity shall execute and
deliver such agreements and other documents, including a Guaranty, and take such
other action as the Agent may require to evidence or confirm its express
assumption of the obligations and liabilities of its predecessor entities under
the Loan Documents;
9.8 Restricted Payments. Make any Restricted Payment or apply or set apart
any of their assets therefor or agree to do any of the foregoing except (a) a
one time cash dividend of approximately $2,200,000 payable to the holders of
BREED common stock on or before November4, 1997, (b) BREED may make Restricted
Payments (i) prior to the issuance of the Convertible Preferred Securities on
the Series B Preference Shares required pursuant to the Prudential Stock
Purchase Documents and (ii) after the issuance of the Convertible Preferred
Securities to the BTI Trust on the Convertible Debentures (and the BTI Trust may
make distributions on the Convertible Preferred Securities) so long as both
before and after giving effect thereto, no Default or Event of Default exists,
and (c) the redemption of the Series B Preference Shares with Net Proceeds
received from the sale of the Convertible Preferred Securities or such other
equity or equity linked securities as approved by the Required Lenders.
9.9. Transactions with Affiliates. Other than transactions permitted under
Sections 9.5, 9.6, 9.7 and 9.8, and transactions with the BTI Trust (to the
extent necessary for BREED to perform its obligations with respect to the
Convertible Preferred Securities), Guarantors, Borrowing Subsidiaries or Direct
Foreign Subsidiaries, enter into any transaction after the Closing Date,
including, without limitation, the purchase, sale, lease or exchange of
property, real or personal, or the rendering of any service, with any Affiliate
of BREED, except (a)that such Persons may render services to BREED or its
Subsidiaries for compensation at the same rates generally paid by Persons
engaged in the same or similar businesses for the same or similar services,
(b)that BREED or any Subsidiary may render services to such Persons for
compensation at the same rates generally charged by BREED or such Subsidiary and
(c) in either case in the ordinary course of business and pursuant to the
reasonable requirements of BREED's (or any Subsidiary's) business consistent
with past practice of BREED and its Subsidiaries and upon fair and reasonable
terms no less favorable to BREED (or any Subsidiary) than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate;
9.10. Compliance with ERISA, the Code and Foreign Benefit Laws. With
respect to any Pension Plan, Employee Benefit Plan or Multiemployer Plan:
(a) permit the occurrence of any Termination Event which would result in a
liability on the part of BREED, any ERISA Affiliate, or any Subsidiary to the
PBGC or any Governmental Authority; or
(b) permit the present value of all benefit liabilities under all Employee
Benefit Plans to exceed the current value of the assets of such Employee Benefit
Plans allocable to such benefit liabilities; or
(c) permit any accumulated funding deficiency (as defined in Section 302 of
ERISA and Section 412 of the Code) with respect to any Pension Plan, whether or
not waived; or
(d) fail to make any contribution or payment to any Multiemployer Plan
which BREED or any ERISA Affiliate may be required to make under any agreement
relating to such Multiemployer Plan, or any law pertaining
thereto; or
(e) engage, or permit BREED or any ERISA Affiliate to engage, in any
prohibited transaction under Section 406 of ERISA or Sections 4975 of the Code
for which a civil penalty pursuant to Section 502(I) of ERISA or a tax pursuant
to Section 4975 of the Code may be imposed; or
(f) permit the establishment of any Employee Benefit Plan providing
post-retirement welfare benefits or establish or amend any Employee Benefit Plan
which establishment or amendment could result in liability to BREED or any ERISA
Affiliate or any Subsidiary or increase the obligation of BREED or any ERISA
Affiliate or any Subsidiary to a Multiemployer Plan other than those to be
established for certain employees acquired as part of the Allied Acquisition; or
(g) fail, or permit BREED or any ERISA Affiliate or any Subsidiary to fail
to establish, maintain and operate each Employee Benefit Plan in compliance in
all material respects with the provisions of ERISA, the Code, all applicable
Foreign Benefit Laws and all other applicable laws and the regulations and
interpretations thereof;
9.11. Accounting Changes. Change its Fiscal Year or make any change in its
accounting treatment and reporting practices except as required by GAAP;
9.12. Dissolution, etc. Wind up, liquidate or dissolve (voluntarily or
involuntarily) or commence or suffer any proceedings seeking any such winding
up, liquidation or dissolution, except for the dissolution of Xxxxxxx Plasturgia
S.r.l. and Akebono Vaitec and in connection with a merger or consolidation
permitted pursuant to Section 9.7 or as provided in the Operating Plan;
9.13. Limitations on Sales and Leasebacks. Enter into any arrangement with
any Person providing for the leasing by BREED or any Subsidiary of real or
personal property, whether now owned or hereafter acquired in a related
transaction or series of related transactions, which has been or is to be sold
or transferred by BREED or any Subsidiary to such Person or to any other Person
to whom funds have been or are to be advanced by such Person on the security of
such property or rental obligations of BREED or any Subsidiary;
9.14. Change in Control. Cause, suffer or permit to exist or occur any
Change of Control;
9.15. Limitation on Guaranties. Enter into or cause, suffer or permit to
exist any Guaranties except as permitted in Section 9.4.
9.16. Negative Pledge Clauses. Enter into or cause, suffer or permit to
exist any agreement with any Person other than the Agent and the Lenders
pursuant to this Agreement or any other Loan Documents which prohibits or limits
the ability of any of BREED or any Subsidiary to create, incur, assume or suffer
to exist any Lien upon any of its property, assets or revenues, whether now
owned or hereafter acquired, in favor of the Agent and the Lenders under the
Loan Documents; provided that BREED and any Subsidiary may enter into such an
agreement in connection with, and limited solely to, property acquired with the
proceeds of purchase money Indebtedness permitted hereunder;
9.17. Prepayments, Etc. of Indebtedness. (a) Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in any
manner, or make any payment in violation of any subordination terms of, any
Indebtedness; or
(b) amend, modify or change in any manner any term or condition of any
Indebtedness described in Section 9.4(a) or any lease so that the terms and
conditions thereof are less favorable to the Agent and the Lenders than the
terms of such Indebtedness or leases as of the Closing Date;
9.18. Restrictive Agreements. Enter into or cause, suffer or permit to
exist any agreement with any other Person (other than the Agent and the Lenders
pursuant to this Agreement or any other Loan Document) which prohibits, limits
or restricts the ability of any Subsidiary to make any payments, directly or
indirectly, to BREED by way of dividends, advances, repayments of loans or
advances, or other returns on investments, or any other agreement or arrangement
which restricts the ability of any such Subsidiary to make any payment, directly
or indirectly, to BREED.
ARTICLE X
Events of Default and Acceleration
10.1. Events of Default. If any one or more of the following events (herein
called "Events of Default") shall occur for any reason whatsoever (and whether
such occurrence shall be voluntary or involuntary or come about or be effected
by operation of law or pursuant to or in compliance with any judgment, decree or
order of any court or any order, rule or regulation of any Governmental
Authority), that is to say:
(a) if default shall be made in the due and punctual payment of the
principal of any Loan, Reimbursement Obligation or other Obligation, when and as
the same shall be due and payable whether pursuant to any provision of Article
II or Article III, at maturity, by acceleration or otherwise and; or
(b) if default shall be made in the due and punctual payment of any amount
of interest on any Loan, Reimbursement Obligation or other Obligation or of any
fees or other amounts payable to any of the Lenders or the Agent on the date on
which the same shall be due and payable; or
(c) if default shall be made in the performance or observance of any
covenant set forth in Section 2.3(b), 2.12, 8.7, 8.11, 8.12, 8.19, 8.20, 8.25(a)
or 8.26 (and such Default in the case of Section 8.26 shall continue for 15
days) or Article IX;
(d) if a default shall be made in the performance or observance of, or
shall occur under, any covenant, agreement or provision contained in this
Agreement or the Notes (other than as described in clauses (a), (b) or (c)
above) and such default shall continue for thirty (30) or more days after the
earlier of receipt of notice of such default by the Authorized Representative
from the Agent or an Authorized Representative of BREED becomes aware of such
default, or if a default shall be made in the performance or observance of, or
shall occur under, any covenant, agreement or provision contained in any of the
other Loan Documents (beyond any applicable grace period, if any, contained
therein) ( including without limitation failure of any Guarantor to pay the
Agent all of the Guaranteed Obligations in accordance with, and as defined in,
the Guaranty on the Business Day on which the Agent has demanded such payment in
accordance with the terms of the Guaranty ) or in any instrument or document
evidencing or creating any obligation, guaranty, or Lien in favor of the Agent
or any of the Lenders or delivered to the Agent or any of the Lenders in
connection with or pursuant to this Agreement or any of the Obligations, or if
any Loan Document ceases to be in full force and effect (other than by reason of
any action by the Agent or any Lender), or if without the written consent of the
Lenders, this Agreement or any other Loan Document shall be disaffirmed or shall
terminate, be terminable or be terminated or become void or unenforceable for
any reason whatsoever (other than in accordance with its terms in the absence of
default or by reason of any action by the Lenders or the Agent); or
(e) if there shall occur (i) a default, which is not waived, in the payment
of any principal, interest, premium or other amount with respect to any
Indebtedness or Rate Hedging Obligation (other than the Loans and other
Obligations) of BREED or any Subsidiary in an amount not less than $2,000,000 in
the aggregate outstanding, or (ii) a default, which is not waived, in the
performance, observance or fulfillment of any term or covenant contained in any
agreement or instrument under or pursuant to which any such Indebtedness or Rate
Hedging Obligation referred to in clause (i) may have been issued, created,
assumed, guaranteed or secured by BREED or any Subsidiary, or (iii) any other
event of default as specified in any agreement or instrument under or pursuant
to which any such Indebtedness or Rate
Hedging Obligation may have been issued, created, assumed, guaranteed or
secured by BREED or any Subsidiary, and any such default or event of default
specified in clauses (i), (ii) or (iii) shall continue for more than the period
of grace, if any, therein specified, or such default or event of default shall
permit the holder of any such Indebtedness or Rate Hedging Obligation (or any
agent or trustee acting on behalf of one or more holders) to accelerate the
maturity thereof; or
(f) if any representation, warranty or other statement of fact contained in
any Loan Document or in any writing, certificate, report or statement at any
time furnished to the Agent or any Lender by or on behalf of the Borrowers
pursuant to or in connection with any Loan Document, or otherwise, shall be
false or misleading in any material respect when given; or
(g) if BREED or any Subsidiary shall be unable to pay its debts generally
as they become due; file a petition to take advantage of any insolvency statute;
make an assignment for the benefit of its creditors; commence a proceeding for
the appointment of a receiver, trustee, liquidator or conservator of itself or
of the whole or any substantial part of its property; file a petition or answer
seeking liquidation, reorganization or arrangement or similar relief under the
federal bankruptcy laws or any other applicable law or statute; or
(h) if a court of competent jurisdiction shall enter an order, judgment or
decree appointing a custodian, receiver, trustee, liquidator or conservator of
BREED or any Subsidiary or of the whole or any substantial part of its
properties and such order, judgment or decree continues unstayed and in effect
for a period of sixty (60) days, or approve a petition filed against BREED or
any Subsidiary seeking liquidation, reorganization or arrangement or similar
relief under the federal bankruptcy laws or any other applicable law or statute
of the United States of America or any state, which petition is not dismissed
within sixty (60) days; or if, under the provisions of any other law for the
relief or aid of debtors, a court of competent jurisdiction shall assume custody
or control of BREED or any Subsidiary or of the whole or any substantial part of
its properties, which control is not relinquished within sixty (60) days; or if
there is commenced against BREED or any Subsidiary any proceeding or petition
seeking reorganization, arrangement or similar relief under the federal
bankruptcy laws or any other applicable law or statute of the United States of
America or any state which proceeding or petition remains undismissed for a
period of sixty (60) days; or if BREED or any Subsidiary takes any action to
indicate its consent to or approval of any such proceeding or petition; or
(i) if (i) one or more judgments or orders where the amount not covered by
insurance (or the amount as to which the insurer is found not to be liable for)
is in excess of $1,000,000 is rendered against BREED or any Subsidiary, or (ii)
there is any attachment, injunction or execution against any of BREED's or
Subsidiaries' properties for any amount in excess of $1,000,000 in the
aggregate; and such judgment, attachment, injunction or execution remains
unpaid, unstayed, undischarged, unbonded or undismissed for a period of thirty
(30) days; or
(j) if BREED or any Subsidiary shall, other than in the ordinary course of
business (as determined by past practices or as set forth in the Operating
Plan), suspend all or any part of its operations material to the conduct of the
business of BREED or such Subsidiary for a period of more than sixty (60) days;
or (k) any material uninsured damage to or loss, theft or destruction of any of
the Collateral shall occur;
(l) any actual or asserted invalidity (other than by the Agent or Lenders)
of the Loan Documents; or
(m) if there shall occur any Termination Event; or
(n) there shall occur any Change in Control; or
(o) the occurrence of any Indenture Event of Default or the failure to
register securities of the Borrower or BTI Trust as required by any agreement or
instrument to which either of them is a party;
then, and in any such event and at any time thereafter, if such Event of
Default or any other Event of Default shall have
not been waived,
(A) either or both of the following actions may be taken: (i) the Agent,
with the consent of the Required Lenders, may, and at the direction of the
Required Lenders shall, declare any obligation of the Lenders and the Issuing
Bank to make further Loans or to issue additional Letters of Credit terminated,
whereupon the obligation of each Lender to make further Loans and of the Issuing
Bank to issue additional Letters of Credit, hereunder shall terminate
immediately, and (ii) the Agent shall at the direction of the Required Lenders,
at their option, declare by notice to the Borrowers any or all of the
Obligations to be immediately due and payable, and the same, including all
interest accrued thereon and all other obligations of the Borrowers to the Agent
and the Lenders, shall forthwith become immediately due and payable without
presentment, demand, protest, notice or other formality of any kind, all of
which are hereby expressly waived, anything contained herein or in any
instrument evidencing the Obligations to the contrary notwithstanding; provided,
however, that notwithstanding the above, if there shall occur an Event of
Default under clause (g) or (h) above, then the obligation of the Lenders to
make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall
automatically terminate and any and all of the Obligations shall be immediately
due and payable without the necessity of any action by the Agent or the Required
Lenders or notice by or to the Agent or the Lenders;
(B) The Borrowers shall, upon demand of the Agent or the Required Lenders,
deposit cash with the Agent in an amount equal to the amount of any Letter of
Credit Outstandings, as collateral security for the repayment of any future
drawings or payments under such Letters of Credit, and such amounts shall be
held by the Agent pursuant to the terms of the LC Account Agreement; and
(C) the Agent and each of the Lenders shall have all of the rights and
remedies available under the Loan Documents or under any applicable law.
10.2. Agent to Act. In case any one or more Events of Default shall occur
and not have been waived or cured, the Agent may, and at the direction of the
Required Lenders shall, proceed to protect and enforce their rights or remedies
either by suit in equity or by action at law, or both, whether for the specific
performance of any covenant, agreement or other provision contained herein or in
any other Loan Document, or to enforce the payment of the Obligations or any
other legal or equitable right or remedy.
10.3. Cumulative Rights. No right or remedy herein conferred upon the
Lenders or the Agent is intended to be exclusive of any other rights or remedies
contained herein or in any other Loan Document, and every such right or remedy
shall be cumulative and shall be in addition to every other such right or remedy
contained herein and therein or now or hereafter existing at law or in equity or
by statute, or otherwise.
10.4. No Waiver. No course of dealing between the Borrowers and any Lender
or the Agent or any failure or delay on the part of any Lender or the Agent in
exercising any rights or remedies under any Loan Document or otherwise available
to it shall operate as a waiver of any rights or remedies and no single or
partial exercise of any rights or remedies shall operate as a waiver or preclude
the exercise of any other rights or remedies hereunder or of the same right or
remedy on a future occasion.
10.5. Allocation of Proceeds. If an Event of Default has occurred and not
been waived, and the maturity of the Notes has been accelerated pursuant to
Article X hereof, all payments received by the Agent hereunder, in respect of
any principal of or interest on the Obligations or any other amounts payable by
the Borrowers hereunder, shall be applied by the Agent in the following order:
(a) amounts due to the Lenders pursuant to Sections 2.10, 3.3 and 12.5;
(b) payments of interest on Loans and Reimbursement Obligations, to be
applied for the ratable benefit of the Lenders;
(c) payments of principal of Loans and Reimbursement Obligations, to be
applied for the ratable benefit of the Lenders;
(d) payments of cash amounts to the Agent in respect of outstanding Letters
of Credit pursuant to Section 10.1(B);
(e) amounts due to the Lenders pursuant to Sections 3.2(g), 8.15 and 12.9;
(f) payments of all other amounts due under any of the Loan Documents, if
any, to be applied for the ratable benefit of the Lenders;
(g) amounts due to any of the Lenders in respect of Obligations consisting
of liabilities under any Swap Agreement with any of the Lenders on a pro rata
basis according to the amounts owed; and
(h) any surplus remaining after application as provided for herein, to the
Borrowers or otherwise as may be required by applicable law.
10.6. Judgment Currency. The Borrowers, the Agent and each Lender hereby
agree that if, in the event that a judgment is given in relation to any sum due
to the Agent or any Lender hereunder, such judgment is given in a currency (the
"Judgment Currency") other than that in which such sum was originally
denominated (the "Original Currency"), the Borrowers agree to indemnify the
agent or such Lender, as the case may be, to the extent that the amount of the
Original Currency which could have been purchased by the Agent in accordance
with normal banking procedures on the Business Day following receipt of such sum
is less than the sum which could have been so purchased by the Agent had such
purchase been made on the day on which such judgment was given or, if such day
is not a Business Day, on the Business Day immediately preceding the giving of
such judgment, and if the amount so purchased exceeds the amount which could
have been so purchased by the Agent had such purchase been made on the day on
which such judgment was given or, if such day is not a Business Day, on the
Business Day immediately preceding such judgment, the Agent or the applicable
Lenders agrees to remit such excess to the Borrowers. The agreements in this
Section shall survive payment of all Obligations.
ARTICLE XI
The Agent
11.1. Appointment, Powers, and Immunities. Each Lender hereby irrevocably
appoints and authorizes the Agent to act as its agent under this Agreement and
the other Loan Documents with such powers and discretion as are specifically
delegated to the Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
The Agent (which term as used in this sentence and in Section 11.5 and the first
sentence of Section 11.6 hereof shall include its affiliates and its own and its
affiliates' officers, directors, employees, and agents): (a) shall not have any
duties or responsibilities except those expressly set forth in this Agreement
and shall not be a trustee or fiduciary for any Lender; (b) shall not be
responsible to the Lenders for any recital, statement, representation, or
warranty (whether written or oral) made in or in connection with any Loan
Document or any certificate or other document referred to or provided for in, or
received by any of them under, any Loan Document, or for the value, validity,
effectiveness, genuineness, enforceability, or sufficiency of any Loan Document,
or any other document referred to or provided for therein or for any failure by
any Loan Party or any other Person to perform any of its obligations thereunder;
(c) shall not be responsible for or have any duty to ascertain, inquire into, or
verify the performance or observance of any covenants or agreements by any Loan
Party or the satisfaction of any condition or to inspect the property (including
the books and records) of any Loan Party or any of its Subsidiaries or
affiliates; (d) shall not be required to initiate or conduct any litigation or
collection proceedings under any Loan Document; and (e) shall not be responsible
to any Lender for any action taken or omitted to be taken by it under or in
connection with any Loan
Document, except for its own gross negligence or willful misconduct. The
Agent may employ agents and attorneys-in- fact and shall not be responsible for
the negligence or misconduct of any such agents or attorneys-in-fact selected by
it with reasonable care. Each Lender hereby irrevocably designates and appoints
NationsBank as the Agent for the Lenders under this Agreement, and each of the
Lenders hereby irrevocably authorizes NationsBank as the Agent for such Lender,
to take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers as are expressly delegated to
the Agent by the terms of this Agreement and such other Loan Documents, together
with such other powers as are reasonably incidental thereto. The Agent shall not
have any duties or responsibilities, except those expressly set forth herein, or
any fiduciary relationship with any of the Lenders, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Agent.
11.2. Reliance by Agent. The Agent shall be entitled to rely upon any
certification, notice, instrument, writing, or other communication (including,
without limitation, any thereof by telephone or telefacsimile) believed by it to
be genuine and correct and to have been signed, sent or made by or on behalf of
the proper Person or Persons, and upon advice and statements of legal counsel
(including counsel for any Loan Party), independent accountants, and other
experts selected by the Agent. The Agent may deem and treat the payee of any
Note as the holder thereof for all purposes hereof unless and until the Agent
receives and accepts an Assignment and Acceptance executed in accordance with
Section 12.1 hereof. As to any matters not expressly provided for by this
Agreement, the 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 instructions of
the Required Lenders, and such instructions shall be binding on all of the
Lenders; provided, however, that the Agent shall not be required to take any
action that exposes the Agent to personal liability or that is contrary to any
Loan Document or applicable law or unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking any such action.
11.3. Defaults. The Agent shall not be deemed to have knowledge or notice
of the occurrence of a Default or Event of Default unless the Agent has received
written notice from a Lender or the Borrowers specifying such Default or Event
of Default and stating that such notice is a "Notice of Default". In the event
that the Agent receives such a notice of the occurrence of a Default or Event of
Default, the Agent shall give prompt notice thereof to the Lenders. The Agent
shall (subject to Section 11.2 hereof) take such action with respect to such
Default or Event of Default as shall reasonably be directed by the Required
Lenders, provided that, unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the Lenders.
11.4. Rights as Lender. With respect to its Revolving Credit Commitment and
Term Loan Commitment and the Loans made by it, NationsBank (and any successor
acting as Agent) in its capacity as a Lender hereunder shall have the same
rights and powers hereunder as any other Lender and may exercise the same as
though it were not acting as the Agent, and the term "Lender" or "Lenders"
shall, unless the context otherwise indicates, include the Agent in its
individual capacity. NationsBank (and any successor acting as Agent) and its
affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any Loan
Party or any of its Subsidiaries or affiliates as if it were not acting as
Agent, and NationsBank (and any successor acting as Agent) and its affiliates
may accept fees and other consideration from any Loan Party or any of its
Subsidiaries or affiliates for services in connection with this Agreement or
otherwise without having to account for the same to the Lenders.
11.5 Indemnification. The Lenders agree to indemnify the Agent (to the
extent not reimbursed under Section 12.9 hereof, but without limiting the
obligations of the Borrowers under such Section) ratably in accordance with
their respective Total Credit Commitments, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees), or disbursements of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against the Agent
(including by any Lender) in any way relating to or arising
out of any Loan Document or the transactions contemplated thereby or any
action taken or omitted by the Agent under any Loan Document; provided that no
Lender shall be liable for any of the foregoing to the extent they arise from
the gross negligence or willful misconduct of the Person to be indemnified.
Without limitation of the foregoing, each Lender agrees to reimburse the Agent
promptly upon demand for its ratable share of any costs or expenses payable by
the Borrowers under Section 12.5, to the extent that the Agent is not promptly
reimbursed for such costs and expenses by the Borrowers. The agreements
contained in this Section shall survive payment in full of the Loans and all
other amounts payable under this Agreement.
11.6. Non-Reliance on Agent and Other Lenders. Each Lender agrees that it
has, independently and without reliance on the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis of the Loan Parties and their Subsidiaries and decision to
enter into this Agreement and that it will, independently and without reliance
upon the Agent or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under the Loan Documents. Except for
notices, reports, and other documents and information expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition, or business of any Loan
Party or any of its Subsidiaries or affiliates that may come into the possession
of the Agent or any of its affiliates.
11.7. Resignation of Agent. The Agent may resign at any time by giving
notice thereof to the Lenders and the Borrowers. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent meeting the
requirements set forth herein. The Borrowers shall have the right to approve
such Agent so long as no Default or Event of Default exist. If no successor
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty (30) days after the retiring Agent's
giving of notice of resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent which shall be a commercial bank organized
under the laws of the United States of America having combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor, such successor shall thereupon succeed to and
become vested with all the rights, powers, discretion, privileges, and duties of
the retiring Agent, and the retiring Agent shall be discharged from its duties
and obligations hereunder. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article XI shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Agent.
11.8. Fees. When and if there shall be more than one Lender under this
Agreement, the Borrowers agree to pay to the Agent, for its individual account,
an Agent's fee as from time to time agreed to by the Borrowers and Agent in
writing.
ARTICLE XII
Miscellaneous
12.1. Assignments and Participations. (a) Each Lender may assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its Loans,
its Notes, its Revolving Credit Commitment, and its Term Loan Commitment);
provided, however, that
(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender or an assignment
of all of a Lender's rights and obligations under this Agreement, any such
partial assignment made prior to November 5, 1997 shall be in an amount at least
equal to $1,000,000 or an integral multiple of $1,000,000 and after November 4,
1997 shall be in an amount at least equal to $5,000,000 or an integral multiple
of $5,000,000 (or if less, the entire remaining amount of such Lender's
Revolving Credit Commitment or Term Loan Commitment) in excess thereof;
(iii) each such assignment by a Lender with respect to the Revolving Credit
Facility shall be of a constant, and not varying, percentage of all of its
rights and obligations under the Revolving Credit Facility and Letter of Credit
Facility and the Revolving Note;
(iv) each such assignment by a Lender with respect to the Term Loan
Facility shall be of a constant, and not varying, percentage of all of its
rights and obligations under the Term Loan Facility and the Term Note; and
(v) the parties to such assignment shall execute and deliver to the Agent
for its acceptance an Assignment and Acceptance in the form of Exhibit B hereto,
together with any Note subject to such assignment and a processing fee of
$3,500; provided, that in the case of contemporaneous assignments by a Lender to
more than one fund managed by or advised by the same investment advisor (which
funds are not then Lenders hereunder), only a single $3,500 fee shall be payable
for all such contemporaneous assignments.
Upon execution, delivery, and acceptance of such Assignment and Acceptance,
the assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such assignment, relinquish its
rights and be released from its obligations under this Agreement. Upon the
consummation of any assignment pursuant to this Section, the assignor, the Agent
and the Borrowers shall make appropriate arrangements so that, if required, new
Notes are issued to the assignor and the assignee. If the assignee is not
incorporated under the laws of the United States of America or a state thereof,
it shall deliver to the Borrowers and the Agent certification as to exemption
from deduction or withholding of Taxes in accordance with Section 5.6.
(b) The Agent shall maintain at its address referred to in Section 12.2 a
copy of each Assignment and Acceptance delivered to and accepted by it and a
register for the recordation of the names and addresses of the Lenders and the
Revolving Credit Commitment and Term Loan Commitment of, and principal amount of
the Loans owing to, each Lender from time to time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrowers or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(c) Upon its receipt of an Assignment and Acceptance executed by the
parties thereto, together with any Note subject to such assignment and payment
of the processing fee, the Agent shall, if such Assignment and Acceptance has
been completed and is in substantially the form of Exhibit B hereto, (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt notice thereof to the parties thereto.
(d) Each Lender may sell participations at its expense to one or more
Persons in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Revolving Credit Commitment and its Loans);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the Borrowers
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the obligations of the Borrowers relating to
its Loans and its Note and to approve any amendment, modification, or waiver of
any provision of this Agreement (other than amendments, modifications, or
waivers decreasing the amount of principal of or the rate at which interest is
payable on such Loans or Note, extending any scheduled principal payment date or
date fixed for the payment of interest on such Loans or Note, or extending its
Revolving Credit Commitment) and (iv) the sale of any such participation which
requires BREED to file a registration statement with federal or state regulatory
authorities shall not be permitted.
(e) Notwithstanding any other provision set forth in this Agreement, any
Lender may at any time assign and pledge all or any portion of its Loans and its
Note to any Federal Reserve Bank as collateral security pursuant to Regulation A
and any Operating Circular issued by such Federal Reserve Bank. No such
assignment shall release the
assigning Lender from its obligations hereunder.
(f) Any Lender may furnish any information concerning BREED or any of its
Subsidiaries in the possession of such Lender from time to time to assignees and
participants (including prospective assignees and participants) so long as such
Lender shall require in writing (which writing names the Borrowers as a third
party beneficiary thereof) any such assignee or participant or perspective
assignee or participant to maintain the confidentiality of any information
delivered to it which is not publicly available.
(g) The Borrowers may not assign, nor shall they cause, suffer or permit
any Guarantor to assign any rights, powers, duties or obligations under this
Agreement of the other Loan Documents without the prior written consent of all
the Lenders.
12.2. Notices. Any notice shall be conclusively deemed to have been
received by any party hereto and be effective (i) on the day on which delivered
(including hand delivery by commercial courier service) to such party (against
receipt therefor), (ii) on the date of receipt at such address, telefacsimile
number or telex number as may from time to time be specified by such party in
written notice to the other parties hereto or otherwise received), in the case
of notice by telegram or telefacsimile, respectively (where the receipt of such
message is verified by return), or (iii) on the fifth Business Day after the day
on which mailed, if sent prepaid by certified or registered mail, return receipt
requested, in each case delivered, transmitted or mailed, as the case may be, to
the address or telefacsimile number, as appropriate, set forth below or such
other address or number as such party shall specify by notice hereunder:
(a) if to the Borrowers:
BREED Technologies, Inc.
0000 Xxx Xxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention:
Telephone:
Telefacsimile:
(b) if to the Agent:
NationsBank, National Association
Independence Center, 00xx Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to:
NationsBank, National Association
000 X. Xxxxxx Xxxxx, 0xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attention: Global Finance
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
(c) if to the Lenders:
At the addresses set forth on the signature pages hereof and on the
signature page of each Assignment and
Acceptance;
(d) if to any Guarantor, at the address set forth on the signature page of
the Guaranty or other Loan Document executed by such Guarantor, as the case may
be.
12.3. Right of Set-off; Adjustments. (a) Upon the occurrence and during the
continuance of any Event of Default, each Lender (and each of its affiliates) is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Lender (or any of its affiliates) to or for the credit or
the account of the Borrowers against any and all of the obligations of the
Borrowers now or hereafter existing under this Agreement and the Note held by
such Lender, irrespective of whether such Lender shall have made any demand
under this Agreement or such Note and although the payment of such obligations
may not have been accelerated. Each Lender agrees promptly to notify the
Borrowers after any such set-off and application made by such Lender; 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 are
in addition to other rights and remedies (including, without limitation, other
rights of set-off) that such Lender may have.
(b) If any Lender (a "benefitted Lender") shall at any time receive any
payment of all or part of the Loans owing to it, or interest thereon, or receive
any collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other
Lender's Loans owing to it, or interest thereon, such benefitted Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loans owing to it, or shall provide such
other Lenders with the benefits of any such collateral, or the proceeds thereof,
as shall be necessary to cause such benefitted Lender to share the excess
payment or benefits of such collateral or proceeds ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment or
benefits is thereafter recovered from such benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest. The Borrowers agree that any Lender so
purchasing a participation from a Lender pursuant to this Section 12.3 may, to
the fullest extent permitted by law, exercise all of its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Person were the direct creditor of the Borrowers in the amount of such
participation.
12.4. Survival. All covenants, agreements, representations and warranties
made herein shall survive the making by the Lenders of the Loans and the
issuance of the Letters of Credit and the execution and delivery to the Lenders
of this Agreement and the Notes and shall continue in full force and effect so
long as any of Obligations remain outstanding or any Lender has any commitment
hereunder or the Borrowers have continuing obligations hereunder unless
otherwise provided herein. Whenever in this Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the successors and
permitted assigns of such party and all covenants, provisions and agreements by
or on behalf of the Borrowers which are contained in the Loan Documents shall
inure to the benefit of the successors and permitted assigns of the Lenders or
any of them.
12.5. Expenses. The Borrowers agree to pay on demand all reasonable costs
and expenses of the Agent in connection with the syndication, preparation,
execution, and delivery of this Agreement, the other Loan Documents, and the
other documents to be delivered hereunder, including, without limitation, the
reasonable fees (not to exceed $500,000) and expenses of Xxxxx Xxxxx Mulliss &
Xxxxx, L.L.P., counsel for the Agent, with respect thereto and with respect to
advising the Agent as to its rights and responsibilities under the Loan
Documents. The Borrowers further agree to pay on demand all reasonable costs and
expenses of the Agent, including, without limitation, the reasonable fees and
expenses of counsel for the Agent, in connection with any future modification or
amendment of this Agreement, the other Loan Documents, and the other documents
delivered hereunder. The Borrowers further agree to pay on demand all reasonable
costs and expenses of the Agent and the Lenders, if any (including, without
limitation, reasonable attorneys' fees and
expenses and the cost of internal counsel), in connection with the
enforcement (whether through negotiations, legal proceedings, or otherwise) of
the Loan Documents and the other documents to be delivered hereunder.
12.6. Amendments and Waivers. Any provision of this Agreement or any other
Loan Document may be amended or waived if, but only if, such amendment or waiver
is in writing and is signed by the Borrowers and the Required Lenders (and, if
Article XI or the rights or duties of the Agent are affected thereby, by the
Agent); provided that no such amendment or waiver shall, unless signed by all
the Lenders, (i) increase the Revolving Credit Commitments or Term Loan
Commitments of the Lenders, (ii) reduce the principal of or rate of interest on
any Loan or any fees or other amounts payable hereunder, (iii) postpone any date
fixed for the payment of any scheduled installment of principal of or interest
on any Loan or any fees or other amounts payable hereunder or for termination of
any Revolving Credit Commitment or Term Loan Commitment, (iv) change the
percentage of the Revolving Credit Commitments or Term Loan Commitments or of
the unpaid principal amount of the Notes, or the number of Lenders, which shall
be required for the Lenders or any of them to take any action under this Section
or any other provision of this Agreement or (v) release any Guarantor or Pledged
Stock or a material portion of the other Collateral except pursuant to any sale,
merger or consolidation permitted hereunder; and provided, further, that no such
amendment or waiver which affects the rights, privileges, or obligations of
NationsBank as issuer of Letters of Credit, shall be effective unless signed in
writing by NationsBank.
Notwithstanding any provision of the other Loan Documents to the contrary,
as between the Agent and the Lenders, execution by the Agent shall not be deemed
conclusive evidence that the Agent has obtained the written consent of the
Required Lenders. No notice to or demand on the Borrowers in any case shall
entitle the Borrowers to any other or further notice or demand in similar or
other circumstances, except as otherwise expressly provided herein. No delay or
omission on any Lender's or the Agent's part in exercising any right, remedy or
option shall operate as a waiver of such or any other right, remedy or option or
of any Default or Event of Default.
12.7. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such fully-executed counterpart.
12.8. Termination. The termination of this Agreement shall not affect any
rights of the Borrowers, the Lenders or the Agent or any obligation of the
Borrowers, the Lenders or the Agent, arising prior to the effective date of such
termination, and the provisions hereof shall continue to be fully operative
until all transactions entered into or rights created or obligations incurred
prior to such termination have been fully disposed of, concluded or liquidated
and the Obligations arising prior to or after such termination have been
irrevocably paid in full. The rights granted to the Agent for the benefit of the
Lenders under the Loan Documents shall continue in full force and effect,
notwithstanding the termination of this Agreement, until all of the Obligations
have been paid in full after the termination hereof (other than Obligations in
the nature of continuing indemnities or expense reimbursement obligations not
yet due and payable, which shall continue) or the Borrowers have furnished the
Lenders and the Agent with an indemnification satisfactory to the Agent and each
Lender with respect thereto. All representations, warranties, covenants, waivers
and agreements contained herein shall survive termination hereof until payment
in full of the Obligations unless otherwise provided herein. Notwithstanding the
foregoing, if after receipt of any payment of all or any part of the
Obligations, any Lender is for any reason compelled to surrender such payment to
any Person because such payment is determined to be void or voidable as a
preference, impermissible setoff, a diversion of trust funds or for any other
reason, this Agreement shall continue in full force and the Borrowers shall be
liable to, and shall indemnify and hold the Agent or such Lender harmless for,
the amount of such payment surrendered until the Agent or such Lender shall have
been finally and irrevocably paid in full. The provisions of the foregoing
sentence shall be and remain effective notwithstanding any contrary action which
may have been taken by the Agent or the Lenders in reliance upon such payment,
and any such contrary action so taken shall be without prejudice to the Agent or
the Lenders' rights under this Agreement and shall be deemed to have been
conditioned upon such payment having become final and irrevocable.
12.9. Indemnification. (a) The Borrowers agree to indemnify and hold
harmless the Agent and each Lender and each of their affiliates and their
respective officers, directors and employees (each, an "Indemnified Party") from
and against any and all claims, damages, losses, liabilities, costs, and
expenses (including, without limitation, reasonable attorneys' fees) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation, or proceeding or
preparation of defense in connection therewith) the Loan Documents, any of the
transactions contemplated herein or the actual or proposed use of the proceeds
of the Loans, except to the extent such claim, damage, loss, liability, cost, or
expense is finally judicially determined to have directly and primarily resulted
from such Indemnified Party's gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section 12.9(a) applies, such indemnity shall be effective whether or
not such investigation, litigation or proceeding is brought by the Borrowers,
their directors, shareholders or creditors or an Indemnified Party or any other
Person or any Indemnified Party is otherwise a party thereto and whether or not
the transactions contemplated hereby are consummated.
(b) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers contained
in this Section 12.9 shall survive the payment in full of the Loans and all
other amounts payable under this Agreement and the Notes.
12.10. Severability. If any provision of this Agreement or the other Loan
Documents shall be determined to be illegal or invalid as to one or more of the
parties hereto, then such provision shall remain in effect with respect to all
parties, if any, as to whom such provision is neither illegal nor invalid, and
in any event all other provisions hereof shall remain effective and binding on
the parties hereto.
12.11. Entire Agreement. This Agreement, together with the other Loan
Documents, constitutes the entire agreement among the parties with respect to
the subject matter hereof and supersedes all previous proposals, negotiations,
representations, commitments and other communications between or among the
parties, both oral and written, with respect thereto.
12.12. Agreement Controls. In the event that any term of any of the Loan
Documents other than this Agreement conflicts with any express term of this
Agreement, the terms and provisions of this Agreement shall control to the
extent of such conflict.
12.13 Usury Savings Clause. Notwithstanding any other provision herein, the
aggregate interest rate charged under any of the Notes, including all charges or
fees in connection therewith deemed in the nature of interest under applicable
law shall not exceed the Highest Lawful Rate (as such term is defined below). If
the rate of interest (determined without regard to the preceding sentence) under
this Agreement at any time exceeds the Highest Lawful Rate (as defined below),
the outstanding amount of the Loans made hereunder shall bear interest at the
Highest Lawful Rate until the total amount of interest due hereunder equals the
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect. In
addition, if when the Loans made hereunder are repaid in full the total interest
due hereunder (taking into account the increase provided for above) is less than
the total amount of interest which would have been due hereunder if the stated
rates of interest set forth in this Agreement had at all times been in effect,
then to the extent permitted by law, the Borrowers shall pay to the Agent an
amount equal to the difference between the amount of interest paid and the
amount of interest which would have been paid if the Highest Lawful Rate had at
all times been in effect. Notwithstanding the foregoing, it is the intention of
the Lenders and the Borrowers to conform strictly to any applicable usury laws.
Accordingly, if any Lender contracts for, charges, or receives any consideration
which constitutes interest in excess of the Highest Lawful Rate, then any such
excess shall be cancelled automatically and, if previously paid, shall at such
Lender's option be applied to the outstanding amount of the Loans made hereunder
or be refunded to the Borrowers. As used in this paragraph, the term "Highest
Lawful Rate" means the maximum lawful interest rate, if any, that at any time or
from time to time may be contracted for, charged, or received under the laws
applicable to such Lender which are presently in effect or, to the extent
allowed by law, under
such applicable laws which may hereafter be in effect and which allow a
higher maximum nonusurious interest rate than applicable laws now allow.
12.14. Governing Law; Waiver of Jury Trial.
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN CERTAIN PLEDGE
AGREEMENTS COVERING SHARES OF DIRECT FOREIGN SUBSIDIARIES) SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE NOTWITHSTANDING ITS
EXECUTION AND DELIVERY OUTSIDE SUCH STATE.
(b) THE BORROWERS HEREBY EXPRESSLY AND IRREVOCABLY AGREE AND CONSENTS THAT
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND
THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE INSTITUTED IN ANY STATE OR FEDERAL
COURT SITTING IN THE COUNTY OF HILLSBOROUGH, STATE OF FLORIDA, UNITED STATES OF
AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWERS
EXPRESSLY WAIVE ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY
SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND THE BORROWERS HEREBY
IRREVOCABLY SUBMIT GENERALLY AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH
COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) THE BORROWERS AGREE THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL
SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN ANY
SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL (POSTAGE
PREPAID) TO THE ADDRESS OF THE BORROWERS PROVIDED IN SECTION 12.2, OR BY ANY
OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE
STATE OF FLORIDA.
(d) NOTHING CONTAINED IN SUBSECTIONS (a) OR (b) HEREOF SHALL PRECLUDE THE
AGENT OR ANY LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENT IN THE COURTS OF ANY JURISDICTION WHERE THE
BORROWERS OR ANY OF THE BORROWERS' PROPERTY OR ASSETS MAY BE FOUND OR LOCATED.
TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, THE
BORROWERS HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY SUCH COURT AND
EXPRESSLY WAIVE, IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO
THE EXERCISE OF JURISDICTION OVER THEM AND THEIR PROPERTY BY ANY SUCH OTHER
COURT OR COURTS WHICH NOW OR HEREAFTER MAY BE AVAILABLE UNDER APPLICABLE LAW.
(e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES
UNDER OR RELATED TO ANY LOAN DOCUMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR
AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION
THEREWITH, THE BORROWERS, THE AGENT AND THE LENDERS HEREBY AGREE, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN
ANY SUCH ACTION OR PROCEEDING.
12.15. Recovery Under Florida Mortgage. The recovery of the Agent under the
Mortgage executed by BREED Automotive of Florida, Inc. to secure the Obligations
as defined therein encumbering approximately 430 acres of real property as
described therein and to be recorded in the Clerk of Circuit Court of Polk
County, Florida (the "Florida
Mortgage") shall be limited to the principal amount of $50,000,000 together
with accrued interest on such amount and other costs and fees as provided in
such Florida Mortgage. The Florida Mortgage secures the first amounts advanced
and the last amounts repaid to the Lenders.
[Signatures on following pages]
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
made, executed and delivered by their duly authorized officers as of the day and
year first above written.
BREED TECHNOLOGIES, INC.
WITNESS:
/s/ X. Xxxxxx XxXxxxxxx By:/s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxx Title: Secretary
BREED AUTOMOTIVE SAFETY SYSTEMS SL
WITNESS:
/s/ X. Xxxxxx XxXxxxxxx By: /s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxx Title:
BREED ITALIAN HOLDINGS, SRL
WITNESS:
/s/ X. Xxxxxx XxXxxxxxx By:/s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxx Title:
BREED UK LIMITED
WITNESS:
/s/ X. Xxxxxx XxXxxxxxx By:/s/ Xxxxxxx Xxxxxxx
Name:Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxx Title:
ICSRD R.F., GMBH
WITNESS:
/s/ X. Xxxxxx XxXxxxxxx By:/s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxx Title:
NATIONSBANK, NATIONAL ASSOCIATION,
as Agent for the Lenders
By:/s/ Miles X. Xxxxxxx III
Name: Miles X. Xxxxxxx III
Title:Senior Vice President
NATIONSBANK, NATIONAL ASSOCIATION
By:/s/ Miles X. Xxxxxxx III
Name:Miles X. Xxxxxxx III
Title:Senior Vice President
Domestic Lending Office:
NationsBank, National Association
Independence Center, 00xx Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxx XxXxxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
Wire Transfer Instructions:
NationsBank, National Association
ABA# _________ Account No.:
Reference: BREED Technologies, Inc.
Attention: Agency Services
BHF-BANK AKRIENGESELLSCHAFT
By:/s/ Xxxxx Xxxx Xxxxxxx Xxxxxx
Name:Xxxxx Xxxx Xxxxxxx Xxxxxx
Title: V.P. A.T.
Domestic Lending Office:
BHF-BANK
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
Wire Transfer Instructions:
Bank of New York
New York, New York
ABA No.: 000000000
Account No.: 8023014646
Reference: BHF-BANK/Breed
THE LONG-TERM CREDIT BANK OF JAPAN,
LIMITED
By:/s/ Xxxxxx Xxxxxx
Name:Xxxxxx Xxxxxx
Title: Joint General Manager
Domestic Lending Office:
The Long-Term Credit Bank of Japan, Limited
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Wire Transfer Instructions:
The Chase Manhattan Bank
ABA No.: 021 000 021
Account No.: 000-0-00000
Reference: The Long-Term Credit Bank of Japan,
New York Branch
THE BANK OF NOVA SCOTIA
By:/s/ X.X. Xxxxx
Name: X.X. Xxxxx
Title:Vice President
Domestic Lending Office:
The Bank of Nova Scotia
000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
Wire Transfer Instructions:
Xxx Xxxx xx Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
ABA No.: 000000000
Credit: ScotiaBanc Inc.
Account No.: 0000000
Reference: BREED Technologies, Inc.
Attention: Xxxxxxx Xxxxxx
XXX XXXXXX AMERICAN CAPITAL
By:/s/ Xxxxxxx X. Xxxxxxx
Name:Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and Director
Domestic Lending Office:
Xxx Xxxxxx American Capital
One Parkview Plaza - 5th Floor
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Wire Transfer Instructions:
State Street Bank & Trust
ABA#000000000
Account No.: 00000000
Reference: VKAC PRIT (Breed Technologies)
Attention: Xx. Xxxx Xxxxxxx
Telecopier No.: 000-000-0000
Telephone No.: 000-000-0000
EXHIBIT A
Applicable Commitment Percentages
I. Revolving Credit Facility
Lender Revolving Applicable
Credit Commitment
Commitment Percentage
NationsBank, National
Association $ 225,000,000 75.000000000%
The Long-Term Credit Bank
of Japan, Limited $ 25,000,000 8.333333333%
BHF-Bank Akriengesellschaft $ 25,000,000 8.000000000%
The Bank of Nova Scotia $ 25,000,000 8.000000000%
$ 300,000,000 100%
II. Term Loan Facility
Lender Term Applicable
Loan Commitment
Commitment Percentage
NationsBank, National
Association $ 375,000,000 62.500000000%
The Long-Term Credit Bank
of Japan, Limited $ 50,000,000 8.333333333%
BHF-Bank Akriengesellschaft $ 50,000,000 8.000000000%
The Bank of Nova Scotia $ 50,000,000 8.000000000%
Xxx Xxxxxx American Capital $ 75,000,000 12.500000000%
$ 600,000,000 100%
EXHIBIT B-1
Form of Assignment and Acceptance
DATED ,
Reference is made to the Credit Agreement dated as of October 30, 1997 (the
"Agreement") among BREED TECHNOLOGIES, INC., a Delaware corporation (the
"Borrower"), the Lenders (as defined in the Agreement), and NationsBank,
National Association , as Agent for the Lenders ("Agent"). Unless otherwise
defined herein, terms defined in the Agreement are used herein with the same
meanings.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee, WITHOUT RECOURSE
and without representation or warranty except as expressly set forth herein, and
the Assignee hereby purchases and assumes from the Assignor, an interest in and
to the Assignor's rights and obligations under the Credit Agreement and the
other Loan Documents as of the date hereof equal to the percentage interest in
either the Revolving Credit Commitment or the Term Loan Commitment, or both,
specified on Schedule 1. After giving effect to such sale and assignment, the
Assignee's Revolving Credit Commitment and Term Loan Commitment and the amount
of the Loans owing to the Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant thereto; (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Loan Party or the
performance or observance by any Loan Party of any of its obligations under the
Loan Documents or any other instrument or document furnished pursuant thereto;
and (iv) attaches the Note or Notes held by the Assignor and requests that the
Agent exchange such Note or Notes for new Notes payable to the order of the
Assignee in an amount equal to the Revolving Credit Commitment or Term Loan
Commitment, or both, assumed by the Assignee pursuant hereto and to the Assignor
in an amount equal to the Revolving Credit Commitment or Term Loan Commitment,
or both, retained by the Assignor, if any, as specified on Schedule 1.
3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 8.1 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon the Agent, the Assignor 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 the Credit
Agreement; (iii) confirms that it is an Eligible Assignee; (iv) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Credit Agreement as are delegated to the
Agent by the terms thereof, together with such powers and discretion as are
reasonably incidental thereto; (v) agrees that it will perform in accordance
with their terms all of the obligations that by the terms of the Credit
Agreement are required to be performed by it as a Lender; and (vi) attaches any
U.S. Internal Revenue Service or other forms required under Section 5.6.
4. Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance and recording by the Agent. The effective
date for this Assignment and Acceptance (the "Effective Date") shall be the date
of acceptance hereof by the Agent, unless otherwise specified on Schedule 1.
5. Upon such acceptance and recording by the Agent, as of the Effective
Date, (i) the Assignee shall be a party to the Credit Agreement and, to the
extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.
6. Upon such acceptance and recording by the Agent, from and after the
Effective Date, the Agent shall make all payments under the Credit Agreement and
the Notes in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and commitment fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Credit Agreement and the Notes for periods
prior to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the laws of the State of Florida.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto 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. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telefacsimile
shall be effective as delivery of a manually executed counterpart of this
Assignment and Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused Schedule 1 to
this Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date specified thereon.
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
Percentage interest assigned: ________%
(a) Revolving Credit Commitment ________%
(b) Term Loan Commitment ________%
Assignee's Revolving Credit Commitment: $_______
Aggregate outstanding principal amount
of Revolving Loans assigned: $_______
Principal amount of Revolving Note payable
to Assignee: $_______
Principal amount of Revolving Note payable
to Assignor: $_______
Assignee's Term Loan Commitment: $_______
Aggregate outstanding principal amount
of Term Loans assigned: $_______
Principal amount of Term Note payable
to Assignee: $_______
Principal amount of Term Note payable
to Assignor: $_______
Effective Date (if other than date
of acceptance by Agent): _______, 19__
[NAME OF ASSIGNOR], as Assignor
By:
Title:
Dated: , 19 _
[NAME OF ASSIGNEE], as Assignee
By:
Title:
Lending Office:
Accepted [and Approved] *
this ___ day of ___________, 19 _
NATIONSBANK NATIONAL ASSOCIATION
By:
Title:
[Approved this ____ day
of ____________, 19__
BREED TECHNOLOGIES, INC.
By: ]*
Title:
* Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the definition of "Eligible Assignee".
EXHIBIT C
Notice of Appointment (or Revocation) of Authorized Representative
Reference is hereby made to the Credit Agreement dated as of October 30,
1997 (the "Agreement") among BREED TECHNOLOGIES, INC., a Delaware corporation
("BREED"), and certain Subsidiaries of BREED designated as Borrowers therein
(BREED and such Subsidiaries being collectively called the "Borrowers"), the
Lenders (as defined in the Agreement), and NationsBank, National Association, as
Agent for the Lenders ("Agent"). Capitalized terms used but not defined herein
shall have the respective meanings therefor set forth in the Agreement.
The Borrower hereby nominates, constitutes and appoints each individual
named below as an Authorized Representative under the Loan Documents, and hereby
represents and warrants that (i) set forth opposite each such individual's name
is a true and correct statement of such individual's office (to which such
individual has been duly elected or appointed), a genuine specimen signature of
such individual and an address for the giving of notice, and (ii) each such
individual has been duly authorized by the Borrower to act as Authorized
Representative under the Loan Documents:
Name and Address Office Specimen Signature
Borrower hereby revokes (effective upon receipt hereof by the Agent) the
prior appointment of ________________ as an Authorized Representative.
This the ___ day of __________________, 19__.
BREED TECHNOLOGIES, INC.
By:
Name:
Title:
EXHIBIT D
Form of Borrowing Notice
To: NationsBank, National Association,
as Agent
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telefacsimile: (000)000-0000
Reference is hereby made to the Credit Agreement dated as of October 30,
1997 (the "Agreement") among BREED TECHNOLOGIES, INC., a Delaware corporation
("BREED"), and certain Subsidiaries of BREED designated as Borrowers therein
(BREED and such Subsidiaries being collectively called the "Borrowers"), the
Lenders (as defined in the Agreement), and NationsBank, National Association, as
Agent for the Lenders ("Agent"). Capitalized terms used but not defined herein
shall have the respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives notice to
the Agent that Loans of the type and amount set forth below be made on the date
indicated:
Type of Loan Interest Aggregate
(check one) Period(1) Amount(2) Date of Loan(3)
Revolving Loan
Base Rate Loan ______ _________ ____________
Eurodollar Rate Loan ______ _________ ____________
Alternative Currency(4) ______ _________ ____________
Term Loan Segment
Base Rate Loan ______ _________ ____________
Eurodollar Rate Loan ______ _________ ____________
Alternative Currency(4) ______ _________ ____________
--------------------------------------------------
(1) For any Eurodollar Rate Loan, one, two, or three months.
(2) Must be $5,000,000 or if greater an integral multiple of $1,000,000,
unless a Base Rate Refunding Loan.
(3) At least three (3) Business Days later if a Eurodollar Rate Loan;
(4) Specify Pounds Sterling, Italian Lire, French Francs, Deutsch Marks,
or Spanish Pesetas.
The Borrower hereby requests that the proceeds of Loans described in this
Borrowing Notice be made available to the Borrower as follows: [insert
transmittal instructions] .
The undersigned hereby certifies that:
1. No Default or Event of Defaultexists either now or after giving
effect to the borrowing described herein; and
2. All the representations and warranties set forth in Article VII of the
Agreement and in the Loan Documents (other than those expressly stated to refer
to a particular date) are true and correct in all material respects as of the
date hereof except that the reference to the financial statements in Section
7.6(a) of the Agreement are to those financial statements most recently
delivered to you pursuant to Section 8.1 of the Agreement (it being understood
that any financial statements delivered pursuant to Section 8.1(b) or (c) have
not been certified by independent public accountants) and attached hereto are
any changes to the Schedules referred to in connection with such representations
and warranties.
3. All conditions contained in the Agreement to the making of any Loan
requested hereby have been met or satisfied in full .
BREED TECHNOLOGIES, INC.
BY:
Authorized Representative
DATE:
EXHIBIT E
Form of Collateral Assignment of Trademark License Agreement
[See Attached]
EXHIBIT F
Form of Collateral Assignment of Partnership Interests
[See Attached]
EXHIBIT G
Form of Guaranty
[See Attached]
EXHIBIT H
Form of Intellectual Property Security Agreement
[See Attached]
EXHIBIT I
Form of Intercompany Notes
ASSIGNMENT
KNOW ALL MEN by these presents that the undersigned is the owner and holder
of that certain promissory note dated ________ payable by ________________ to
the undersigned in the original principal amount of $________ the ("Promissory
Note") and has sold, assigned, transferred, endorsed and set over, and by this
assignment does sell, assign, transfer, endorse and set over to
______________________________________________ all of its right title and
interest in the Promissory Note, and the obligations described therein and the
monies due and to become due thereunder.
TO HAVE AND TO HOLD the same unto ______________________________, its
successors and assigns forever.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
executed on the __ day of __________, _____.
---------------------------------
By:______________________________
Name:___________________________
Title:____________________________
Certificate No. 1
INTERCOMPANY NOTE
Dated: [Insert Date]
FOR VALUE RECEIVED, the undersigned, [Insert name of Intercompany Note
Maker], a ______ corporation (the "Payor"), hereby promises to pay to the order
of [Insert name of Intercompany Note Holder], a __________ corporation (the
"Payee"), UPON DEMAND, at [Insert address of Intercompany Note Holder], in
lawful money of the United States of America and in immediately available funds,
the aggregate amount of all loans and advances by the Payee to the Payor
remaining outstanding at such time, such loans and advances constituting
Intercompany Advances in accordance with Section 9.4(g) of the Credit Agreement
dated as of October 30, 1997 (as amended, supplemented or restated from time to
time, the "Credit Agreement"; the terms defined therein and not otherwise
defined herein being used herein as therein defined) among BREED Technologies,
Inc. ("BREED") and certain Subsidiaries of BREED designated as Borrowers
therein, as Borrowers, NationsBank, National Association in its capacity as a
Lender ("NationsBank") and each other financial institution executing and
delivering a signature page to the Credit Agreement and each other financial
institution which may hereafter execute and deliver an instrument of assignment
with respect to the Credit Agreement (hereunder such financial institutions may
be referred to individually as a "Lender" or collectively as the "Lenders"), and
NationsBank in its capacity as the Agent for the Lenders (the "Agent"), provided
that any and all amounts advanced by the Payor to the Payee at any time when
amounts are outstanding hereunder shall be applied to the prepayment of such
outstanding amounts, including any interest which constitutes part of such
outstanding amounts.
Interest shall be payable under this Intercompany Note on any and all
principal amounts from time to time outstanding hereunder from and including the
date of the initial advance by the Payee and the Payor until such principal
amounts are paid in full, at a rate per annum equal to
[___________________________________________________________]. Accrued interest
shall be payable upon demand, or if no demand is made therefor, quarterly on the
last day of each calendar quarter.
This Intercompany Note may, at the option of the Payor, be prepaid at any
time in whole or in part, without penalty or premium
The Payee agrees that the accounts of the Payor shall be prima facie
evidence of the amounts advanced by the Payee to the Payor and the amounts
repaid by the Payor to the Payee. All advances made by the Payee to the Payor
hereunder, and all payments made on account of principal hereof, shall be
recorded by the Payor and, prior to any transfer hereof, endorsed on the grid
attached hereto that is part of this Intercompany Note; provided that the
failure to record any such advance or payment shall not affect the obligations
of the Payor and the Payee with respect thereto.
The indebtedness evidenced by this Intercompany Note (the "Subordinated
Indebtedness") is and shall be subordinate and subject in right of payment, to
the extent and in the manner hereinafter set forth, to the prior payment in full
of all obligations of the Payor now or hereafter existing under or in respect of
(a) the Loan Documents, whether for principal, interest (including, without
limitation, interest accruing after the filing of a petition initiating any
Proceeding (as defined below), whether or not such interest accrues after the
filing of such petition for purposes of Chapter 11 of Title 11 of the United
States Code or is an allowed claim in such Proceeding), fees, commissions,
expenses or otherwise; and
(b) any and all amendments, modifications, extensions, refinancing,
renewals and refunding of the
obligations referred to in clause (a) of this paragraph that are made in
accordance with the applicable terms thereof (all such obligations under clauses
(a) and (b) of this paragraph being, collectively, the "Senior Indebtedness").
For the purposes of the provisions hereof, the Senior Indebtedness shall
not be deemed to have been paid in full until the Facility Termination Date;
provided, however, that on such date neither the Agent nor any other Lender
shall have made any claim against the Payee or any other Loan Party under any
provision of any of the Loan Documents that has not been cash collateralized by
an amount sufficient in the reasonable judgment of the Agent, to secure such
claim.
So long as the Senior Indebtedness shall not have been paid in full, the
Payee shall not (a) ask, demand, xxx for, take or receive from the Payor
(except, so long as no Default or Event of Default shall have occurred and be
continuing, in the ordinary course of business of the Payor and the Payee,
directly or indirectly, in cash or other property or by setoff or in any manner
(including, without limitation, from or by way of Collateral), payment of all or
any of the Subordinated Indebtedness or (b) commence, or join with any creditor
other than the Agent or any Lender in commencing, or directly or indirectly
cause the Payor to commence, or assist the Payor in commencing, any Proceeding.
Upon the occurrence and during the continuance of a Default or an Event of
Default, no payment or distribution of any assets of the Payor of any kind or
character (including, without limitation, any payment that may be payable by
reason of any other Indebtedness of the Payor being subordinated to payment of
the Subordinated Indebtedness) shall be made by or on behalf of the Payor for or
on account of any Subordinated Indebtedness, and the Payee shall not ask,
demand, xxx for, take or receive from the Payor, directly or indirectly, in cash
or other property or by setoff or in any other manner (including, without
limitation, from or by way of Collateral), payment of all or any of the
Subordinated Indebtedness, unless and until such Default or Event of Default
shall have been cured or waived in writing or such Senior Indebtedness shall
have been paid in full, after which the Payor may resume making any and all
required payments in respect of the Subordinated Indebtedness (including any
missed payments).
In the event of any dissolution, winding up, liquidation, arrangement,
reorganization, adjustment, protection, relief or composition of the Payor or
its debts, whether voluntary or involuntary, in any bankruptcy, insolvency,
arrangement, reorganization, receivership, relief or other similar case or
proceeding under any federal or state bankruptcy or similar law or upon an
assignment for the benefit of creditors or any other marshalling of the assets
and liabilities of the Payor or otherwise (each, a "Proceeding"), the Agent, for
its benefit and for the ratable benefit of the Lenders, shall be entitled to
receive payment in full of all of the Senior Indebtedness before the Payee is
entitled to receive any payment or distribution of any kind or character on
account of all or any of the Subordinated Indebtedness, and, to that end, any
payment or distribution of any kind (whether in cash, property or securities)
that otherwise would be payable or deliverable upon or with respect to the
Subordinated Indebtedness in any such Proceeding (including, without limitation,
any payment that may be payable by reason of any other Indebtedness of the Payor
being subordinated to payment of the Subordinated Indebtedness) shall be paid or
delivered directly to the Agent, for its benefit and for the ratable benefit of
the Lenders for application (in the case of cash) to, or as collateral (in the
case of noncash property or securities) for, the payment or prepayment of the
Senior Indebtedness until all of the Senior Indebtedness shall have been paid in
full. In the event that any Subordinated Indebtedness is declared due and
payable before its stated maturity, if any, the Agent, for its benefit and for
the ratable benefit of the Lenders, shall be entitled to receive payment in full
of all amounts due or to become due on or in respect of all of the Senior
Indebtedness before the Payee is entitled to receive any payment (including,
without limitation, any payment that may be payable by reason of the payment of
any other Indebtedness of the Payor being subordinated to the payment of the
Subordinated Indebtedness) by the Payor on account of the Subordinated
Indebtedness.
Until such time as the Senior Indebtedness has been paid in full, if any
Proceeding is commenced by or against the Payor,
(a) the Agent is hereby irrevocably authorized and empowered (in its own
name or in the name of the Payee or otherwise), but shall have no obligation, to
demand, xxx for, collect and receive every payment or distribution referred to
above and give acquittance therefor, and to file claims and proofs of claim and
take such other action (including, without limitation, voting the Subordinated
Indebtedness or enforcing any security interest or other lien securing payment
of the Subordinated Indebtedness) as it may deem necessary or advisable for the
exercise or enforcement of any of the rights or interest of the Agent and the
Lenders hereunder; and
(b) the Payee shall duly and promptly take such action as the Agent may
request (i) to collect the Subordinated Indebtedness for the account of the
Agent, for its benefit and for the ratable benefit of the Lenders, and to file
appropriate claims or proofs of claim in respect of the Subordinated
Indebtedness, (ii) to execute and deliver to the Agent such powers of attorney,
assignments or other instruments as the Agent may request in order to enable to
Agent to enforce any and all claims with respect to, and any security interests
and other liens securing payment of, the Subordinated Indebtedness, and (iii) to
collect and receive any and all payments or distributions that may be payable or
deliverable upon or with respect to the Subordinated Indebtedness.
All payments or distributions upon or with respect to the Subordinated
Indebtedness that are received by the Payee contrary to the provisions of this
Agreement shall be received in trust for the benefit of the Agent, for its
benefit and for the ratable benefit of the Lenders, shall be segregated from
other property or funds held by the Payee and shall be forthwith paid over or
delivered directly to the Agent, for its benefit and for the ratable benefit of
the Lenders, in the same form as so received (with any necessary endorsement) to
be applied (in the case of cash) to, or held as collateral (in the case of
noncash property or securities) for, the payment or prepayment of the Senior
Indebtedness in accordance with the terms of the Loan Documents.
The Agent is hereby authorized to demand specific performance of these
provisions, whether or not the Payor shall have complied with any of the
provisions hereof applicable to it, at any time when the Payee shall have failed
to comply with any of these provisions. The Payee hereby irrevocably waives any
defense based on the adequacy of a remedy at law, which might be asserted as a
bar to such remedy of specific performance. The Payee will not:
(a) (i) Cancel or otherwise discharge any of the Subordinated Indebtedness
(except upon payment in full of the Senior Indebtedness); (ii) convert or
exchange any of the Subordinated Indebtedness into or for any other Indebtedness
or equity interest; or (iii) subordinate any of the Subordinated Indebtedness to
any Indebtedness of the Payor other than the Senior Indebtedness;
(b) Sell, assign, pledge, encumber or otherwise dispose of any of the
Subordinated Indebtedness other than the pledge of the instruments evidencing
the Subordinated Indebtedness to the Agent, on behalf of the Lenders, under the
applicable Security Instruments; or
(c) Permit the terms of any of the Subordinated Indebtedness to be changed
in such a manner as to have an adverse effect upon the rights or interests of
the Secured Parties hereunder.
No payment or distribution to the Agent or any Lender pursuant to the
provisions hereof shall entitle the Payee to exercise any rights of subrogation
in respect thereof until the Facility Termination Date.
The holders of the Senior Indebtedness may, at any time and from time to
time, without any consent of or notice to the Payee or any other holder of the
Subordinated Indebtedness and without impairing or releasing the obligations of
the Payee hereunder:
(a) change the manner, place or terms of payment, or change or extend the
time of payment of, or renew payment or change or extend the time or payment of,
or renew or alter, the Senior Indebtedness (including any change
in the rate of interest thereon), or amend in any manner any agreement
under which any of the Senior Indebtedness is outstanding;
(b) sell, exchange, release, not perfect and otherwise deal with any
property at any time pledged, assigned or mortgaged to secure the Senior
Indebtedness;
(c) release anyone liable in any manner under or in respect of the Senior
Indebtedness;
(d) exercise or refrain from exercising any rights against the Payor, any
other Loan Party or any other Person; and
(e) apply to the Senior Indebtedness any sums from time to time received.
The foregoing provisions regarding subordination are and are intended
solely for the purpose of defining the relative rights of the holders of the
Senior Indebtedness on the one hand and the holders of the Subordinated
Indebtedness on the other hand. Such provisions are for the benefit of the
holders of the Senior Indebtedness and shall inure to the benefit of, and shall
be enforceable by, the Agent, on behalf of itself and the Lenders, directly
against the holders of the Subordinated Indebtedness, and no holder of the
Senior Indebtedness shall be prejudiced in its right to enforce subordination of
any of the Subordinated Indebtedness by any act or failure to act by the Payor
or anyone in custody of its property or assets. Nothing contained in the
foregoing provisions is intended to or shall impair, as between the Payor and
the holders of the Subordinated Indebtedness, the obligations of the Payor to
such holders.
The Payor agrees to pay on demand all costs and expenses (including,
without limitation, reasonable fees and expenses of counsel) incurred by the
Agent or any Lender in enforcing the provisions hereof
The Payor hereby waives presentment for payment, demands, notice of
dishonor and protest of this Intercompany Note and further agrees that none of
the terms or provisions hereof may be waived, altered, modified or amended,
except as the Payee may consent in a writing duly signed for and on its behalf.
No amendment, waiver or modification of this Intercompany Note (including,
without limitation, the subordination provisions hereof), and no consent to any
departure here from, shall adversely affect the Agent or any other Lender in any
manner unless the same shall be in writing and signed by the Agent and/or such
Lender, and then such waiver, modification or consent shall be effective only in
the specific instance and for the specific purpose for which given.
No failure or delay on the part of the Payee in exercising any of its
rights, powers or privileges hereunder shall operate as a waiver thereof, nor
shall a single or partial exercise thereof preclude any other or further
exercise of any right, power or privilege. The remedies provided herein are
cumulative and are not exclusive of any remedies provided by law.
This Intercompany Note shall be governed by and construed in accordance
with the laws of the State of Florida.
By:
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
Amount of
Amount of Principal Paid Unpaid Principal Notation
Date Advance or Prepaid Balance Made By
ENDORSEMENT
PAY TO THE ORDER OF
Dated: _____________________________________________
By:
Title:
EXHIBIT J
Form of Subordination Agreement
[See Attached]
EXHIBIT K Form of Interest Rate Selection Notice To: NationsBank, National
Association, as Agent
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telefacsimile: (000) 000-0000
Reference is hereby made to the Credit Agreement dated as of October 30,
1997 (the "Agreement") among BREED TECHNOLOGIES, INC. , a Delaware corporation
("BREED"), and certain Subsidiaries of BREED designated as Borrowers therein
(BREED and such Subsidiaries being collectively called the "Borrowers"), the
Lenders (as defined in the Agreement), and NationsBank, National Association, as
Agent for the Lenders ("Agent"). Capitalized terms used but not defined herein
shall have the respective meanings therefor set forth in the Agreement.
The Borrower through its Authorized Representative hereby gives notice to the
Agent of the following selection of a type of Loan and Interest Period:
Type of Loan Interest Aggregate
(check one) Period(1) Amount(2) Date of Loan(3)
Revolving Loan
Base Rate Loan ______ _________ ____________
Eurodollar Rate Loan ______ _________ ____________
Alternative Currency(4) ______ _________ ____________
Term Loan Segment
Base Rate Loan ______ _________ ____________
Eurodollar Rate Loan ______ _________ ____________
Alternative Currency(4) ______ _________ ____________
--------------------------------------------------
(1) For any Eurodollar Rate Loan, one, two, or three months.
(2) Must be $5,000,000 or if greater an integral multiple of $1,000,000,
unless a Base Rate Refunding Loan.
(3) At least three (3) Business Days later if a Eurodollar Rate Loan;
(4) Specify Pounds Sterling, Italian Lire, French Francs, Deutsch Marks,
or Spanish Pesetas.
BREED TECHNOLOGIES, INC.
BY:___________________________________
Authorized Representative
DATE:_________________________________
EXHIBIT L
Form of Landlord Waiver
[See Attached]
EXHIBIT M
Form of LC Account Agreement
[See Attached]
EXHIBIT N
Form of Lease Assignment
[See Attached]
EXHIBIT O-1
Form of Term Note
Promissory Note (Term Loan)
$600,000,000 Charlotte, North Carolina
October 30, 1997
FOR VALUE RECEIVED, BREED TECHNOLOGIES, INC., a Delaware corporation having
its principal place of business located in Lakeland, Florida (the "Borrower"),
hereby promises to pay to the order of NATIONSBANK, NATIONAL ASSOCIATION (the
"Lender"), in its individual capacity, at the office of NATIONSBANK, NATIONAL
ASSOCIATION, as agent for the Lenders (the "Agent"), located at One Independence
Center, 000 Xxxxx Xxxxx Xxxxxx, XX0-000-00-00, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
(or at such other place or places as the Agent may designate in writing) at the
times set forth in the Credit Agreement dated as of ____________, 1997 among the
Borrowers, the financial institutions party thereto (collectively, the
"Lenders") and the Agent (as amended, supplemented or restated and in effect
from time to time, the "Agreement"; all capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Agreement), in lawful
money of the United States of America or in the applicable Alternative Currency,
as the case may be, in immediately available funds, the principal amount of SIX
HUNDRED MILLION DOLLARS ($600,000,000) or, if less than such principal amount,
the aggregate unpaid principal amount of the Term Loan made by the Lender to the
Borrower pursuant to the Agreement on the Term Loan Termination Date or such
earlier date as may be required pursuant to the terms of the Agreement, and to
pay interest from the date hereof on the unpaid principal amount hereof, in like
money, at said office, on the dates and at the rates provided in Article II of
the Agreement. All or any portion of the principal amount of Term Loans may be
prepaid as provided in the Agreement.
If payment of all sums due hereunder is accelerated under the terms of the
Agreement or under the terms of the other Loan Documents executed in connection
with the Agreement, the then remaining principal amount and accrued but unpaid
interest shall bear interest which shall be payable on demand at the rates per
annum set forth in the proviso to
Section 2.2(a) of the Agreement or the maximum rate permitted under
applicable law, if lower, until such principal and interest have been paid in
full. Further, in the event of such acceleration, this Term Note, and all other
indebtedness of the Borrower to the Lender shall become immediately due and
payable, without presentation, demand, protest or notice of any kind, all of
which are hereby waived by the Borrower.
In the event this Term Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys' fees and
disbursements, and interest due hereunder thereon at the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
This Term Note is one of the Term Notes referred to in the Agreement and is
issued pursuant to and entitled to the benefits and security of the Agreement to
which reference is hereby made for a more complete statement of the terms and
conditions upon which the Term Loans evidenced hereby were or are made and are
to be repaid. This Term Note is subject to certain restrictions on transfer or
assignment as provided in the Agreement.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby waive
to the full extent permitted by law the benefits of all provisions of law for
stay or delay of execution or sale of property or other satisfaction of judgment
against any of them on account of liability hereon until judgment be obtained
and execution issues against any other of them and returned satisfied or until
it can be shown that the maker or any other party hereto had no property
available for the satisfaction of the debt evidenced by this instrument, or
until any other proceedings can be had against any of them, and also their
right, if any, to require the holder hereof to hold as security for this Term
Note any collateral deposited by any of said Persons as security. Protest,
notice of protest, notice of dishonor, dishonor, demand or any other formality
are hereby waived by all parties bound hereon.
IN WITNESS WHEREOF, the Borrower has caused this Term Note to be made,
executed and delivered by its duly authorized representative as of the date and
year first above written, all pursuant to authority duly granted.
BREED TECHNOLOGIES, INC.
WITNESS:
By:
Name:
Title:
EXHIBIT O-2
Form of Revolving Note
Promissory Note
(Revolving Loan)
$300,000,000 Charlotte, North Carolina
October 30, 1997
FOR VALUE RECEIVED, BREED TECHNOLOGIES, INC., a Delaware corporation having
its principal place of business located in Lakeland, Florida ("BREED"), BREED
AUTOMOTIVE SAFETY SYSTEMS, S.L., BREED ITALIAN HOLDINGS, S.R.L., BREED UK
LIMITED, and ICSRD R.F., GMBH (each a "Borrower" and collectively with BREED the
"Borrowers"), hereby promise to pay to the order of NATIONSBANK, NATIONAL
ASSOCIATION (the "Lender"), in its individual capacity, at the office of
NATIONSBANK, NATIONAL ASSOCIATION, as agent for the Lenders (the "Agent"),
located at One Independence Center, 000 Xxxxx Xxxxx Xxxxxx, XX0-000-00-00,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (or at such other place or places as the Agent
may designate in writing) at the times set forth in the Credit Agreement dated
as of October 30, 1997 among the Borrowers, the financial institutions party
thereto (collectively, the "Lenders") and the Agent (as amended, supplemented or
restated and in effect from time to time, the "Agreement"; all capitalized terms
not otherwise defined herein shall have the respective meanings set forth in the
Agreement), in lawful money of the United States of America or in the applicable
Alternative Currency, as the case may be, in immediately available funds, the
principal amount of THREE HUNDRED MILLION DOLLARS ($300,000,000) or, if less
than such principal amount, the aggregate unpaid principal amount of all
Revolving Loans made by the Lender to the Borrowers pursuant to the Agreement on
the Revolving Credit Termination Date or such earlier date as may be required
pursuant to the terms of the Agreement, and to pay interest from the date hereof
on the unpaid principal amount hereof, in like money, at said office, on the
dates and at the rates provided in Article II of the Agreement. All or any
portion of the principal amount of Revolving Loans may be prepaid or required to
be prepaid as provided in the Agreement.
Each Borrower shall be jointly and severally liable as a primary obligor;
provided that a Borrower which is a Foreign Subsidiary shall be liable hereunder
only for Obligations made by or on its behalf together with interest, fees and
expenses relating thereto as provided in Section 2.1(e) of the Agreement.
If payment of all sums due hereunder is accelerated under the terms of the
Agreement or under the terms of the other Loan Documents executed in connection
with the Agreement, the then remaining principal amount and accrued but unpaid
interest shall bear interest which shall be payable on demand at the rates per
annum set forth in the proviso to Section 2.2(a) of the Agreement or the maximum
rate permitted under applicable law, if lower, until such principal and interest
have been paid in full. Further, in the event of such acceleration, this
Revolving Note, and all other indebtedness of the Borrowers to the Lender shall
become immediately due and payable, without presentation, demand, protest or
notice of any kind, all of which are hereby waived by the Borrowers.
In the event this Revolving Note is not paid when due at any stated or
accelerated maturity, the Borrowers agree to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys' fees and
disbursements, and interest due hereunder thereon at the rates set forth above.
Interest hereunder shall be computed as provided in the Agreement.
This Revolving Note is one of the Revolving Notes referred to in the
Agreement and is issued pursuant to and entitled to the benefits and security of
the Agreement to which reference is hereby made for a more complete statement of
the terms and conditions upon which the Revolving Loans evidenced hereby were or
are made and are to be repaid.
This Revolving Note is subject to certain restrictions on transfer or
assignment as provided in the Agreement.
All Persons bound on this obligation, whether primarily or secondarily
liable as principals, sureties, guarantors, endorsers or otherwise, hereby waive
to the full extent permitted by law the benefits of all provisions of law for
stay or delay of execution or sale of property or other satisfaction of judgment
against any of them on account of liability hereon until judgment be obtained
and execution issues against any other of them and returned satisfied or until
it can be shown that the maker or any other party hereto had no property
available for the satisfaction of the debt evidenced by this instrument, or
until any other proceedings can be had against any of them, also their right, if
any, to require the holder hereof to hold as security for this Revolving Note
any collateral deposited by any of said Persons as security. Protest, notice of
protest, notice of dishonor, dishonor, demand or any other formality are hereby
waived by all parties bound hereon.
IN WITNESS WHEREOF, the Borrowers have caused this Revolving Note to be
made, executed and delivered by its duly authorized representative as of the
date and year first above written, all pursuant to authority duly granted.
BREED TECHNOLOGIES, INC.
WITNESS: By:
Name:
Title:
BREED AUTOMOTIVE SAFETY SYSTEMS SL
WITNESS: By:
Name:
Title:
BREED ITALIAN HOLDINGS, S.R.L.
WITNESS:
By:
Name:
Title:
BREED UK LIMITED
WITNESS:
By:
Name:
Title:
ICSRD R.F. GMBH
WITNESS:
By:
Name:
Title:
EXHIBIT P-1
Form of Stock Pledge Agreement (Borrower)
[See Attached]
EXHIBIT P-2
Form of Stock Pledge Agreement (US Subsidiaries)
[See Attached]
EXHIBIT P-3
Form of Stock Pledge Agreement (Breeds)
[See Attached]
EXHIBIT Q
Form of Intercompany Note Pledge Agreement
[See Attached]
EXHIBIT R
Form of Security Agreement
[See Attached]
EXHIBIT S-1
Form of Opinion of US Counsel
October 30, 1997
NationsBank, National Association, as Agent,
and each of the Lenders Party to the
Credit Agreement Referenced Below
NationsBank Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Re: $500,000,000 Term Loan Facility and $400,000,000 Revolving Credit and
Letter of Credit Facility among NationsBank, National Association, as Agent, the
Lenders party thereto, BREED Technologies, Inc. and certain Subsidiaries
designated as Borrowers therein
Ladies and Gentlemen:
We have acted as counsel to BREED Technologies, Inc., a Delaware
corporation ("BREED") and the Guarantors in connection with the term loan
facility of $500,000,000 (the "Term Loan") and the revolving credit facility of
up to $400,000,000 (the "Revolving Loan"), including the $25,000,000 sublimit
for the Letter of Credit Facility constituting part of the Revolving Credit
Facility (the "LC Facility") and the $75,000,000 sublimit for multi-currency
borrowings, each being made available to BREED and certain Subsidiaries
designated as Borrowers ("Borrowing Subsidiaries" and referred to collectively
with BREED as the "Borrowers") on this date pursuant to the Credit Agreement of
even date herewith among you, the Lenders, BREED and the Borrowing Subsidiaries
(the "Credit Agreement"), and the other transactions contemplated under the
Credit Agreement.
This opinion is being delivered in accordance with the conditions set forth
in Section 6.1 of the Credit Agreement. All capitalized terms not otherwise
defined herein shall have the meanings provided therefor in the Credit
Agreement.
As such counsel, we have reviewed the following documents:
1. the Credit Agreement;
2. the Note;
3. the Guaranty;
4. the Security Instruments;
5. the Financing Statements (as defined herein).
The documents described in items 1 through 5 immediately above are referred
to herein as the "Loan Documents".
For purposes of the opinions expressed below, we have assumed that all
natural persons executing the Loan Documents have legal capacity to do so; that
all signatures (other than those of representatives of BREED and the Guarantors
on the Loan Documents) on all documents submitted to us are genuine; that all
documents submitted to us as originals (other than the Loan Documents) are
authentic; and that all documents submitted to us as certified copies or
photocopies conform to the originals of such documents, which themselves are
authentic.
In addition, for purposes of giving this opinion, we have examined such
corporate records of BREED and the Guarantors, certificates of public officials,
certificates of appropriate officials of BREED and the Guarantors, and such
other documents, and have made such inquiries as we have deemed appropriate.
Based upon and subject to the foregoing, it is our opinion that:
1. BREED is a corporation duly organized, validly existing and in good
standing under the laws of its state of incorporation and is duly qualified to
transact business as a foreign corporation and is in good standing in all
jurisdictions in which the nature of its business requires such qualification.
BREED has full corporate power and authority to own its assets and conduct the
businesses in which it is now engaged and as are expressly contemplated by the
Loan Documents, and has full corporate power and authority to enter into each of
the Loan Documents to which it is a party and to perform its obligations
thereunder.
2. Each of the Loan Documents to which BREED is a party has been duly
authorized by the Board of Directors of BREED (and by any required shareholder
action), has been duly executed and delivered by BREED, and constitutes the
legal, valid and binding obligation, agreement, instrument or conveyance, as the
case may be, of BREED, enforceable against BREED in accordance with its
respective terms, except as the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization and other similar laws
relating to or affecting creditors' rights generally and by the application of
general equitable principles (whether considered in proceedings at law or in
equity).
3. Each Guarantor is a corporation or partnership, as the case may be duly
organized, validly existing and in good standing under the laws of its
respective state of its formation and is duly qualified to transact business as
a foreign entity and is in good standing in all jurisdictions in which the
nature of its business requires such qualification and in which the failure to
be so qualified would reasonably be likely to result in a Material Adverse
Effect. Each Guarantor has full corporate power and authority to own its assets
and conduct the businesses in which it is now engaged and as expressly
contemplated in the Loan Documents, and has full corporate power and authority
to enter into each of the Loan
Documents to which it is a party and to perform its obligations thereunder.
4. Each of the Loan Documents to which each Guarantor is a party has been
duly authorized by the Board of Directors or required partners of such Guarantor
(and by any required shareholder or partnership action), has been duly executed
and delivered by such Guarantor, and constitutes the legal, valid and binding
obligation, agreement or instrument, as the case may be, of such Guarantor,
enforceable against such Guarantor in accordance with its respective terms,
except as the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization and other similar laws relating to or affecting
creditors' rights generally and by the application of general equitable
principles (whether considered in proceedings at law or in equity).
5. Neither the execution or delivery of, nor performance by BREED or any
Guarantor of its obligations under, the Loan Documents (a) does or will conflict
with, violate or constitute a breach of (i) the Organizational Documents or
Operating Documents of BREED or any Guarantor, (ii) any laws, rules or
regulations applicable to BREED or any other Guarantor, or (iii) any contract,
agreement, indenture, lease, instrument, other document, judgment, writ,
determination, order, decree or arbitral award to which BREED or any Guarantor
is a party or by which BREED or any Guarantor or any of their properties is
bound, (b) requires the prior consent of, notice to, license from or filing with
any Governmental Authority which has not been duly obtained or made on or prior
to the date hereof, or (c) does or will result in the creation or imposition of
any lien, pledge, charge or encumbrance of any nature upon or with respect to
any of the properties of BREED or any Guarantor, except for the Liens in your
favor expressly created pursuant to the Loan Documents.
6. There is no pending or, to the best of our knowledge, threatened,
action, suit, investigation or proceeding (including, without limitation, any
action, suit, investigation, or proceeding under any environmental or labor
law), nor is there any basis therefor, before or by any court, or governmental
department, commission, board, bureau, instrumentality, agency or arbitral
authority, (i) which calls into question the validity or enforceability of any
of the Loan Documents, or the titles to their respective offices or authority of
any officers of BREED or any Guarantor or (ii) an adverse result in which would
reasonably be likely to have a Material Adverse Effect.
7. To the best of our knowledge after due inquiry, neither BREED nor any
Guarantor (i) is in default (which default has not been waived) under any
agreement, document or instrument to which it is a party or by which it or any
of its assets is bound or (ii) is in violation of any law, rule, regulation,
judgment, writ, determination, order, decree or arbitral award to which BREED or
any Guarantor is a party or by which BREED or any Guarantor or any of their
respective properties is bound, which default or violation, as the case may be,
would constitute a Default or Event of Default under the Credit Agreement or
otherwise could reasonably be likely to have a Material Adverse Effect.
8. None of the transactions contemplated by the Credit Agreement,
including, without limitation, the use of the proceeds of the Loans provided for
in the Loan Documents, will violate or result in a violation of Section 7 of the
Securities Exchange Act of 1934, as amended, any regulations issued pursuant
thereto, or regulations G, T, U or X of the Board of Governors of the Federal
Reserve System.
9. None of the provisions of the Loan Documents violate any laws of the
State of Florida relating to interest or usury.
10. Once value has been given to BREED by the Lenders and assuming the
Agent, for the benefit of the Lenders, has taken possession of the certificates
representing all of the Pledged Stock, as more fully described in Schedule A
hereto, and the stock powers related thereto, for value in good faith and
without notice of an adverse claim, so long as the Agent, for the benefit of the
Lenders, maintains continuous and uninterrupted possession of the certificates
representing the Pledged Stock, the Pledge Agreement will create a valid and
perfected security interest in favor of the Agent, for the benefit of the
Lenders, in the Pledged Stock subject to no other security interest, lien,
encumbrance or adverse claim (other than restrictions on transfer imposed by
applicable securities laws) and no filings or recordation are
necessary to perfect the security interests created by the Pledge Agreement
in the Pledged Stock. Such security interest will have priority over any other
consensual security interests in the Pledged Stock.
11. All of the shares of Pledged Stock which are shares of the capital
stock of any Domestic Subsidiary ("Pledged Domestic Subsidiary Stock") are duly
authorized, validly issued, fully paid and nonassessable, and free of any
preemptive rights. The Certificates listed on Schedule A hereto are now the sole
evidence of the shares of Pledged Domestic Subsidiary Stock and all shares of
Pledged Domestic Subsidiary Stock have been duly delivered to you with an
appropriate stock power assignment sufficient to permit the sale or transfer of
the shares of Pledged Domestic Subsidiary Stock by you in accordance with the
terms of the Pledge Agreement, subject to applicable federal and state
securities law. The delivery of physical possession of the Pledged Domestic
Subsidiary Stock to the Agent and the execution and delivery of the stock powers
with respect to the Pledged Domestic Subsidiary Stock have been duly authorized
by the owner of such Pledged Domestic Subsidiary Stock.
12. All of the shares of Pledged Stock which are shares of the capital
stock of BREED ("Pledged BREED Stock") are duly authorized, validly issued,
fully paid and nonassessable, and free of any preemptive rights. The
Certificates listed on Schedule A hereto are now the sole evidence of the
Pledged BREED Stock and all shares of Pledged BREED Stock have been delivered to
you with an appropriate stock power assignment sufficient to permit the sale or
transfer of the shares of Pledged BREED Stock by you in accordance with the
terms of the Pledge Agreement, subject to applicable federal and state
securities law. The delivery of physical possession of the Pledged BREED Stock
to the Agent and the execution and delivery of the stock powers with respect to
the Pledged BREED Stock have been duly authorized by Xxxxxxx X. Breed, Xxxxx X.
Breed, A. BREED Ltd, a Texas limited partnership, J. BREED Ltd, a Texas limited
partnership, BREED Charitable Foundation, and [five trusts of which Ms. Breed is
trustee with shared voting and investment power].
13. Once value has been given to BREED by the Lenders and the Receipt and
Certificate of Registrar is executed, the Collateral Assignment of Partnership
Interests will create a valid and perfected security interest in favor of the
Agent, for the benefit of the Lenders, in the Assigned Interests subject to no
other security interest, lien, encumbrance or adverse claim and no filings or
recordations are necessary to perfect the security interests created by the
Collateral Assignment of Partnership Interests in the Assigned Interests. Such
security interest will have priority over any other consensual security
interests in the Assigned Interests. All required consents to the assignment of
the Assigned Interests have been obtained. All of the Assigned Interests are
duly authorized, validly issued, fully paid and nonassessable, and free of any
preemptive rights.
14. The Security Agreement and the Collateral Assignment of Trademark
License Agreement are effective to create a valid security interest in favor of
the Agent for the benefit of the Lenders in the Collateral described therein.
The Uniform Commercial Code Financing Statements on Form UCC-1 described on
Schedule 7.23 of the Credit Agreement (collectively, the "Financing Statements")
have been duly executed and delivered to the Agent and are in form, number and
content sufficient (together with the tender of necessary filing fees) for
filing with the respective filing offices described on Schedule 7.23 with the
effect that, upon such filing, the Agent shall have a duly perfected security
interest in the Collateral described in the Security Agreement and the
Collateral Assignment of Trademark License Agreement to the extent that a
security interest in such Collateral can be perfected by the filing of financing
statements under the Uniform Commercial Code as in effect in the appropriate
jurisdictions. No further filings or recordation are necessary to perfect the
security interests created by the Security Agreement and the Collateral
Assignment of Trademark License Agreement.
Our opinions contained herein are rendered solely in connection with the
transactions contemplated under the Loan Documents and may not be relied upon in
any manner by any Person other than the addressees hereof, any successor or
assignee of any addressee (including successive assignees) and any Person who
shall acquire a participation interest in the interest of any Lender
(collectively, the "Reliance Parties"), or by any Reliance Party for any other
purpose. Our opinions herein shall not be quoted or otherwise included,
summarized or referred to in any publication or document, in
whole or in part, for any purposes whatsoever, or furnished to any Person
other than a Reliance Party (or a Person considering whether to become a
Reliance Party), except as may be required of any Reliance Party by applicable
law or regulation or in accordance with any auditing or oversight function or
request of regulatory agencies to which a Reliance Party is subject.
Very truly yours,
Schedule A to Legal Opinion
Pledged Stock
EXHIBIT S-2
Form of Opinion of Intellectual Property Counsel
October 30, 1997
NationsBank, National Association, as Agent and Each of the Lenders Party
to the Credit Agreement Referenced Below NationsBank Xxxxxxxxx Xxxxxx Xxxxxxxxx,
Xxxxx Xxxxxxxx 00000-0000
Re: $500,000,000 Term Loan Facility and $400,000,000 Revolving Credit and
Letter of Credit Facility among NationsBank, National Association, as Agent, the
Lenders party thereto, BREED Technologies, Inc. and certain Subsidiaries
designated as Borrowers therein
Ladies and Gentlemen:
We have acted as special intellectual property counsel to BREED
Technologies, Inc., a Delaware corporation ("BREED") and the Guarantors in
connection with the term loan facility of $500,000,000 (the "Term Loan") and the
revolving credit facility of up to $400,000,000 (the "Revolving Loan"),
including the $25,000,000 sublimit for the Letter of Credit Facility
constituting part of the Revolving Credit Facility (the "LC Facility") and the
$75,000,000 sublimit for multi-currency borrowings, each being made available to
BREED and certain Subsidiaries designated as Borrowers ("Borrowing Subsidiaries"
and referred to collectively with BREED as the "Borrowers") on this date
pursuant to the Credit Agreement of even date herewith among you, the Lenders,
BREED and the Borrowing Subsidiaries (the "Credit Agreement"), and the other
transactions contemplated under the Credit Agreement.
This opinion is being delivered in accordance with the conditions set forth
in Section 6.1 of the Credit Agreement. All capitalized terms not otherwise
defined herein shall have the meanings provided therefor in the Credit
Agreement.
As such counsel, we have reviewed the following documents:
1. the Credit Agreement;
2. the Guaranty;
3. the Intellectual Property Security Agreement; and
4. the Assignment of Patents, Trademarks, Copyrights and Licenses.
The documents described in items 1 through 4 immediately above are referred
to herein as the "Loan Documents".
For purposes of the opinions expressed below, we have assumed that all
natural persons executing the Loan Documents have legal capacity to do so; that
all signatures (other than those of representatives of BREED and the Guarantors
on the Loan Documents) on all documents submitted to us are genuine; that all
documents submitted to us as originals (other than the Loan Documents) are
authentic; and that all documents submitted to us as certified copies or
photocopies conform to the originals of such documents, which themselves are
authentic.
In addition, for purposes of giving this opinion, we have examined such
corporate records of BREED and the Guarantors, certificates of public officials,
certificates of appropriate officials of BREED and the Guarantors, and such
other documents, and have made such inquiries as we have deemed appropriate.
Based upon and subject to the foregoing, it is our opinion that:
1. The Intellectual Property Security Agreement is effective to create a
valid security interest in the right, title, and interest of BREED and each
Guarantor which is a signatory thereto in the Patents, Trademarks, Copyrights
and Licenses (as defined in the Agreement) with respect to which a security
interest can be created under Chapter 9 of the Uniform Commercial Code and any
applicable federal law.
2. If the Intellectual Property Security Agreement is recorded (i) in the
case of patents and trademarks with the United States Patent and Trademark
Office and there is attached to such recorded document (A) with respect to
trademarks claimed as collateral a listing naming the correct grantor as owner
and giving the correct name of the trademark and federal registration or
application number of each trademark owned by such grantor, and (B) with respect
to patents claimed as collateral a listing naming the correct grantor as owner
and giving the title of the invention, together with its associated patent
number or patent application number of each patent owned by such grantor, and
(ii) in the case of copyrights with the United States Copyright Office and there
is attached to such recorded document with respect to copyrights claimed as
collateral a listing specifying the title of the work, the registration number,
and the registration date, and a Financing Statement in the form reviewed is
properly filed with the [__________], the security interest of the Secured Party
in such trademarks, patents, and copyrights will be perfected if perfection is
determined by [________________] law or any applicable Federal Law.
Our opinions contained herein are rendered solely in connection with the
transactions contemplated under the Loan Documents and may not be relied upon in
any manner by any Person other than the addressees hereof, any successor or
assignee of any addressee (including successive assignees) and any Person who
shall acquire a participation interest in the interest of any Lender
(collectively, the "Reliance Parties"), or by any Reliance Party for any other
purpose. Our opinions herein shall not be quoted or otherwise included,
summarized or referred to in any publication or document, in whole or in part,
for any purposes whatsoever, or furnished to any Person other than a Reliance
Party (or a Person considering whether to become a Reliance Party), except as
may be required of any Reliance Party by applicable law or regulation or in
accordance with any auditing or oversight function or request of regulatory
agencies to which a Reliance Party is subject.
Very truly yours,
EXHIBIT S-3
Form of Opinion of Foreign Counsel
[See Attached]
EXHIBIT T
Compliance Certificate
NationsBank, National Association,
as Agent
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telefacsimile: (000) 000-0000
Reference is hereby made to the Credit Agreement dated as of October 30,
1997 (the "Agreement") among BREED Technologies, Inc., a Delaware corporation
("BREED"), and certain Subsidiaries of BREED designated as Borrowers therein
(BREED and such Subsidiaries being collectively referred to as the "Borrowers")
the Lenders (as defined in the Agreement) and NationsBank, National Association,
as Agent for the Lenders ("Agent"). Capitalized terms used but not otherwise
defined herein shall have the respective meanings therefor set forth in the
Agreement. The undersigned, a duly authorized and acting Authorized
Representative, hereby certifies to you as of __________ (the "Determination
Date") as follows:
1. Calculations:
A. Compliance with Section 9.1(a): Consolidated Net Worth
1. Required Consolidated Net Worth at the last day of the most recent
fiscal quarter $______________
2. Consolidated Net Income x 0.9 $______________
3. 100% of the Net Proceeds from any Equity Offering $______________
3. Sum of A.1 + A.2 + A.3 $______________
4. Actual Consolidated Net Worth $______________
Required: A.4 must not be less than A.3
B. Compliance with Section 9.1(b): Consolidated EBITDA
1. Consolidated Net Income $______________
2. Consolidated Interest Expense $______________
3. Taxes on income $______________
4. Depreciation $______________
5. Amortization $______________
6. Consolidated EBITDA $______________ (B.1 + B.2 + B.3 +B.4 +B.5)
Required: B.1 must not be less than $25,000,000 for the two months ending
12/31/97, $64,000,000 for the five months ending 3/31/98, or $107,000,000 for
the eight months ending 6/30/98
C. Compliance with Section 9.1(c): Capital Expenditures
1. Capital Expenditures $______________
Required: C.1 must not exceed $17,000,000 in for the two months ending
12/31/97, $37,000,000 for the five months ending 3/31/98, or $57,000,000 for the
eight months ending 6/30/98
2. No Default
A. Since __________ (the date of the last similar certification), (a) BREED
has not defaulted in the keeping, observance, performance or fulfillment of its
obligations pursuant to any of the Loan Documents; and (b) no Default or Event
of Default specified in Article X of the Agreement has occurred and is
continuing.
B. If a Default or Event of Default has occurred since __________ (the date
of the last similar certification), BREED proposes to take the following action
with respect to such Default or Event of Default: .
(Note, if no Default or Event of Default has occurred, insert "Not
Applicable").
The Determination Date is the date of the last required financial
statements submitted to the Lenders in accordance with Section 8.1 of the
Agreement.
IN WITNESS WHEREOF, I have executed this Certificate this _____ day of
__________, 19___.
By:
Authorized Representative
Name:
Title:
EXHIBIT U
Form of Assumption Letter
[Date]
To NationsBank, National Association,
as Agent and the Lenders party to the
Credit Agreement referred to below
Ladies and Gentlemen:
Reference is hereby made to the Credit Agreement dated as of October 30,
1997 (as the same may be amended, supplemented or restated from time to time,
the "Credit Agreement") among BREED Technologies, Inc., a Delaware corporation
("BREED"), and certain Subsidiaries of BREED designated as Borrowers therein
(BREED and such Subsidiaries being collectively referred to as the "Borrowers")
the Lenders (as defined in the Agreement) and NationsBank, National Association,
as Agent for the Lenders ("Agent"). Terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Credit Agreement.
1. Borrowing Subsidiary.
(i) The undersigned, _________________ (the "Subsidiary") a ______________
corporation and a Subsidiary of BREED, proposes to become a "Borrowing
Subsidiary" under the Credit Agreement, and accordingly hereby agrees that from
the date hereof until the payment in full of the principal of and interest on
all Loans made to it or on its behalf under the Credit Agreement and performance
of all of its other obligations thereunder, and termination of its status as a
"Borrowing Subsidiary" as provided below, it shall perform, comply with and be
bound by each of the provisions of the Credit Agreement which are stated to
apply to a "Borrowing Subsidiary" or a "Borrower". In addition, the Subsidiary
hereby represents and warrants that: (i) each of the representations and
warranties set forth in Article VII of the Credit Agreement is true and correct
with respect to the Subsidiary as of the date hereof and (ii) it has heretofore
received a true and correct copy of the Credit Agreement (including any
amendments thereto, modifications thereof or waivers thereunder) as in effect on
the date hereof.
(ii) So long as the principal of and interest on all Loans made to the
Subsidiary or on its behalf under the Credit Agreement shall have been paid in
full and all other obligations of the Subsidiary under the Credit Agreement
shall have been fully performed, the Subsidiary may, by not less than five
Business Days' prior notice to the Agent, terminate its status as a "Borrowing
Subsidiary."
2. Conditions Precedent. No Lender shall make any Loan to or on behalf of
the Subsidiary unless the Subsidiary has furnished to the Agent, with sufficient
copies for all the Lenders, the following items:
(i) Copies of the Organizational Documents of the Subsidiary, together with
all amendments, and a certificate of good standing (if available), both
certified by the appropriate governmental officer in its jurisdiction of
incorporation.
(ii) Copies, certified by an appropriate officer or director of the
Subsidiary, of its Operating Documents and of its Board of Directors resolutions
(and other Organizational Action, if any are deemed necessary by counsel for the
Agent) authorizing the execution of this Assumption Letter and all other
Loan Documents to which the Subsidiary is a party.
(iii) An incumbency certificate, executed by an appropriate officer or
director of the Subsidiary, which shall identify by name and title and bear the
signature of the officers or directors of the Subsidiary authorized to sign this
Assumption Letter and the other Loan Documents to which it is a party and to
request Loans thereunder, upon which certificate the Agent and the Lenders shall
be entitled to rely until informed of any change in writing by the Subsidiary.
(iv) A favorable written opinion of counsel to the Subsidiary, addressed to
the Lenders, in form and substance satisfactory to the Agent.
(v) Notes issued by the Subsidiary to the order of each of the Lenders.
(vi) Written money transfer instructions, in substantially the form of
Exhibit "A" attached hereto addressed to the Agent on behalf of the Subsidiary
and signed by duly authorized officer, together with such other related money
transfer authorizations as the Agent may have reasonably requested.
(vii) Stock Pledge Agreement pledging 100% of the capital stock and related
interests and rights of any Subsidiary of the Borrowing Subsidiary and any other
document required under Article IV of the Credit Agreement.
(viii) Such other documents as the Agent or its counsel may reasonably
request.
3. Representations. The Subsidiary further represents and warrants to the
Lenders as follows:
(i) Existence and Power. The Subsidiary and each of its Subsidiaries:
(a) is a corporation, partnership or limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation;
(b) has the power and authority and governmental licenses, authorizations,
consents and approvals to own its assets, carry on its business and to execute,
deliver, and perform its obligations under this Assumption Letter and the Loan
Documents;
(c) is duly qualified and is licensed and in good standing under the laws
of each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification or license; and
(d) is in compliance in all material respects with all laws, rules and
regulations and all other valid requirements of any Governmental Authority.
(ii) Authorization; No Contravention. The execution, delivery and
performance by the Subsidiary and its Subsidiaries of this Assumption Letter and
each other Loan Document to which such Subsidiary is party have been duly
authorized by all necessary action and do not and will not:
(a) contravene the terms of any such Subsidiary's Organizational Documents
or Operating Documents; or
(b) conflict with or result in a material breach or contravention of, or
the creation of any Lien
under, any Material Contract or any document evidencing any material
contractual obligation to which such Subsidiary is a party or any order,
injunction, writ or decree of any Governmental Authority to which such
Subsidiary or its property is subject.
(iii) Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Subsidiary or
any of its Subsidiaries of this Assumption Letter or any other Loan Document.
(iv) Binding Effect. This Assumption Letter and each other Loan Document to
which the Subsidiary or any of its Subsidiaries is a party constitute the legal,
valid and binding obligations of the Subsidiary and any of its Subsidiaries to
the extent it is a party thereto, enforceable against such Person in accordance
with their respective terms (except as enforceability may be limited by
applicable bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors' rights generally or by equitable principles relating to
enforceability).
(v) Filing. To ensure the enforceability or admissibility in evidence of
this Assumption Letter, the Notes issued by the Subsidiary or any of the other
Loan Documents in the Subsidiary's country of organization or incorporation and
country which is its principal place of business (each, a "Subject Country"), it
is not necessary that this Assumption Letter or such Notes or any other
documents be filed or recorded with any court or other authority in any Subject
Country or that any stamp or similar tax be paid in respect of this Assumption
Letter or such Notes or any other documents. The qualification by any Lender or
the Agent for admission to do business under the laws of any Subject Country
does not constitute a condition to, and the failure to so qualify does not
affect, the exercise by any Lender or the Agent of any right, privilege, or
remedy afforded to any Lender or the Agent in connection with the Loan Documents
or the enforcement of any such right, privilege, or remedy. The performance by
any Lender or the Agent of any action required or permitted under the Loan
Documents will not violate any law or regulation of any Subject Country or any
political subdivision thereof or result in any tax liability or other
unfavorable consequence to such party pursuant to the laws of any such Subject
Country or political subdivision or taxing authority thereof or any rule or
regulation of any federation or organization or similar entity of which such
Subject Country is a member.
(vi) No Immunity. Neither the Subsidiary nor any of its assets is entitled
to immunity from suit, execution, attachment or other legal process. The
Subsidiary's execution and delivery of this Assumption Letter and the other Loan
Documents to which it is a party constitute, and the exercise of its rights and
performance of and compliance with its obligations under such Loan Documents
will constitute, private and commercial acts done and performed for private and
commercial purposes.
(vii) Regulation U. Margin stock (as defined in Regulation U) constitutes
less than 25% of those assets of the Subsidiary and its Subsidiaries which are
subject to any limitation on sale, pledge, or other restriction hereunder.
4. BREED Guaranty of Subsidiary Obligations. BREED expressly agrees as
follows:
(i) Direct Obligations. BREED hereby unconditionally and irrevocably
affirms to the Lenders its direct liability for, and guarantees to the Lenders,
the due and punctual payment of all obligations and liabilities of the
Subsidiary to the Lenders, whether arising under this Assumption Letter, the
Credit Agreement, the other Loan Documents or any other documents related
thereto (collectively, the "Borrowing Subsidiary Obligations") including, but
not limited to, the due and punctual payment of
principal of and interest on the Notes issued by the Subsidiary, and
punctual payment of all other sums now or hereafter owed by the Subsidiary under
this Assumption Letter, the Credit Agreement, the Loan Documents, any Note
issued by the Subsidiary and any other document related thereto as and when the
same shall become due (whether by acceleration or otherwise) and according to
the terms hereof and thereof. In case of failure by the Subsidiary punctually to
pay any Borrowing Subsidiary Obligation, BREED hereby unconditionally agrees to
cause such payment to be made punctually as and when the same shall become due
and payable, whether at maturity or by declaration or otherwise, and as if such
payment were made by the Subsidiary.
(ii) Obligations Unconditional. The obligations of BREED under this
Assumption Letter shall be irrevocable, unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released, discharged or
otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Subsidiary (or any other Borrowing Subsidiary)
or under any Note or other agreement issued or entered into by any Subsidiary
(or any other Borrowing Subsidiary), by operation of law or otherwise;
(b) any modification or amendment of or supplement to this Assumption
Letter or any Loan Document;
(c) any compromise, settlement, modification, amendment, waiver, release,
non-perfection or invalidity of or to any direct or indirect security, guarantee
or other liability of any third party with respect to any Borrowing Subsidiary
Obligation;
(d) any change in the corporate existence, structure, or ownership of, or
any insolvency, bankruptcy, reorganization or other similar proceeding
affecting, the Subsidiary (or any other Borrowing Subsidiary) or their assets or
any resulting release or discharge of any Borrowing Subsidiary Obligation;
(e) the existence of any claim, set-off or other right which BREED may have
at any time against the Subsidiary (or any other Borrowing Subsidiary), the
Agent, any Lender or any other Person, whether or not arising in connection with
this Assumption Letter or any other Loan Document; provided, however, that
nothing herein shall prevent the assertion of any such claim by separate suit or
compulsory counterclaim;
(f) any invalidity or unenforceability relating to or against the
Subsidiary (or any other Borrowing Subsidiary) for any reason of this Assumption
Letter or any Loan Document, or any provision of applicable law or regulation
purporting to prohibit the payment by the Subsidiary (or any other Borrowing
Subsidiary) of the principal of or interest on any Note issued by the Subsidiary
(or any other Borrowing Subsidiary) or any other amount payable by the
Subsidiary (or any other Borrowing Subsidiary) under this Assumption Letter, the
Credit Agreement or any Loan Document; or
(g) any other act or omission to act or delay of any kind by the Subsidiary
(or any other Borrowing Subsidiary), the Agent, any Lender or any other Person
or any other circumstance whatsoever that might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of the obligations of BREED
under this Assumption Letter, the Credit Agreement or any Loan Document.
(iii) Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances. BREED's obligations hereunder shall remain in full force and
effect until each Revolving Credit Commitment and Term Loan Commitment has
expired or is terminated and the principal of and interest on the Notes and all
other Obligations payable under this Assumption Letter and the Loan Documents
shall have been paid in full. If at any time any payment of the principal of or
interest on any Note issued by the Subsidiary or any other amount payable by the
Subsidiary under this Assumption Letter or any Loan Document is rescinded or
must be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Subsidiary or otherwise, BREED's obligations under this
Assumption Letter with respect to such payment shall be reinstated at such time
as though such payment had become due but had not been made at such time. This
provision shall survive the termination of this Assumption Letter and the
payment in full of the Obligations.
(iv) Waiver. BREED irrevocably waives acceptance hereof, presentment,
demand, protest and any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Subsidiary or any other Person. BREED waives any benefit of the collateral, if
any, which may from time to time secure the Obligations or any part thereof and
authorizes the Agent or the Lenders to take any action, or exercise any remedy
with respect thereto, which the Agent or the Lenders in its or their sole
discretion shall determine, without notice to BREED. In the event the Lenders in
their sole discretion elect to give notice of any action with respect to the
collateral, if any, securing the Obligations or any part thereof, ten days'
written notice mailed to BREED by certified mail at the address set forth in the
Credit Agreement shall be deemed reasonable notice of any matter contained in
such notice.
(v) Stay of Acceleration. If acceleration of the time for payment of any
amount payable by the Subsidiary under this Assumption Letter or any of the Loan
Documents is stayed upon the insolvency, bankruptcy or reorganization of the
Subsidiary or any other Person, all such amounts otherwise subject to
acceleration under the terms of this Assumption Letter or any Loan Document
shall nonetheless be payable by BREED hereunder forthwith on demand by the
Agent.
(vi) Payments. All payments to be made by BREED pursuant to this Assumption
Letter shall be made at the times and in the manner and in the currency
prescribed for payments in the Credit Agreement.
(vii) Delay of Subrogation. Until BREED's obligations under this Assumption
Letter have been paid in full and terminated, BREED shall not exercise any right
of subrogation with respect to payments made by BREED pursuant to this
Assumption Letter.
5. Notice. Any notice to be given to the Subsidiary may be given to BREED
(and shall conclusively be deemed to have been received by the Subsidiary when
received, or deemed received, by BREED) in the manner set forth in the Credit
Agreement. The Subsidiary agrees that BREED may give notice under this
Assumption Letter and the Loan Documents on behalf of the Subsidiary, and that
any such notice given by BREED on behalf of the Subsidiary shall be binding upon
the Subsidiary.
6. Jurisdiction and Governing Law.
(i) Without limiting the provisions of Section 12.14 of the Credit
Agreement, the Subsidiary and BREED each irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
United States federal court and any Florida state court sitting in the county of
Hillsborough, State of Florida, United States of America, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Assumption Letter, the Credit Agreement or any other Loan Document or
for recognition or enforcement of any judgment relating thereto, and the
Subsidiary and BREED each irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in any such court. The Subsidiary and BREED each agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Assumption Letter shall affect any right that any Lender or the
Agent may otherwise have to bring any action or proceeding relating to this
Assumption Letter, the Credit Agreement or any other Loan Document in the courts
of any jurisdiction.
(ii) This Assumption Letter shall be governed by, and construed in
accordance with, the internal laws (and not the law of conflicts) of the State
of Florida; provided that the Agent and the Lenders shall retain all rights
arising under federal law.
[signatures follow]
IN WITNESS WHEREOF, the Subsidiary has duly executed and delivered this
Assumption Letter as of the date and year first above written.
[NAME OF BORROWING SUBSIDIARY]
By
Name:
Title:
Agreed and Consented to:
BREED TECHNOLOGIES, INC.
By:
Name:
Title:
NATIONSBANK, NATIONAL ASSOCIATION, as Agent
By:
Name:
Title:
EXHIBIT "A"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To NationsBank, National Association
as Agent (the "Agent") under the Credit
Agreement Described Below
RE: Credit Agreement dated as of October 30, 1997 (as the same may be
amended, supplemented or restated, the "Credit Agreement"), among BREED
Technologies, Inc., a Delaware corporation ("BREED"), and certain Subsidiaries
of BREED designated as Borrowers therein (BREED and such Subsidiaries being
collectively referred to as the "Borrowers") the Lenders (as defined in the
Agreement) and NationsBank, National Association, as Agent for the Lenders
("Agent"). Terms used herein and not otherwise defined shall have the meanings
assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the following
standing money transfer instructions with respect to the proceeds of Loans or
other extensions of credit from time to time until receipt by the Agent of a
specific written revocation of such instructions by [Name of Borrowing
Subsidiary] (the "Borrowing
Entity"), provided, however, that the Agent may otherwise transfer funds as
hereafter directed in writing by the Borrowing Entity in accordance with Section
12.2 of the Credit Agreement or based on any telephonic notice made in
accordance with any other applicable provision of the Credit Agreement.
Facility Identification Number(s)_______________________________________________
Customer/Account Name___________________________________________________________
Transfer Funds to_______________________________________________________________
------------------------------------------------------------------------
For Account No._________________________________________________________________
Reference/Attention To__________________________________________________________
Authorized Officer (Customer Representative) Date_______________________
------------------------- -----------------------------------
(Please Print) (Signature)
Bank Officer Name Date_______________________
------------------------- -----------------------------------
(Please Print) (Signature)
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
Schedule 1.1(a)
Borrowing Subsidiaries
Name of Subsidiary Jurisdiction
BREED Automotive Safety Systems SL Spain
BREED Italian Holdings, Srl Italy
BREEDUK Limited United Kingdom
ICSRD R.F., GmbH Germany
Schedule 1.1(b)
Initial Advance Allocation
Borrower Initial Advance
BREED Technologies, Inc. $ 718,000,000
BREED Automotive Safety Systems SL $ 15,000,000
BREED Italian Holdings, Srl $ 49,000,000
BREED UK Limited $ 17,000,000
BREED R.F., GmbH $ 1,000,000
$ 800,000,000
Schedule 7.4
Subsidiaries and Investments in Other Persons
Schedule 7.6
Indebtedness
Schedule 7.7
Liens
Schedule 7.10
Litigation
Schedule 7.19
Employment Matters
Schedule 7.23
Financing Statements and Other Filings
Schedule 8.5
Insurance
