1
EXHIBIT 4.2
AMENDED AND RESTATED
CREDIT AGREEMENT
(U.S. $250,000,000)
Dated as of January 30, 1998
among
OM GROUP, INC.
as Borrower
and
THE BANKS WHICH ARE SIGNATORIES HERETO,
NATIONAL CITY BANK
as Agent and
Letter of Credit Bank
and
ABN AMRO BANK N.V.
as Co-Agent
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TABLE OF CONTENTS
Section Page
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1 DEFINITIONS AND ACCOUNTING TERMS
1.1 Certain Defined Terms......................................................................... 1
1.2 Computation of Time Periods................................................................... 16
1.3 Accounting Terms.............................................................................. 16
1.4 Dollar Equivalents............................................................................ 17
2 STATEMENT OF TERMS
2.1 Revolving Credit Facility..................................................................... 17
(a) Revolving Credit Loans............................................................... 17
(b) Revolving Credit Borrowings.......................................................... 17
(c) Revolving Credit Notes; Loan Account................................................. 17
(d) Control Account Maintained by Agent.................................................. 18
2.2 Credit Requests............................................................................... 18
(a) Credit Requests Executed by the Borrower............................................. 18
(b) Requests for Revolving Credit Borrowing Deemed Given................................. 19
2.3 Funding of Revolving Credit Loans............................................................. 20
(a) Disbursement of Funds Received....................................................... 20
2.4 Availability of Funds......................................................................... 20
2.5 Failure of Bank to Fund....................................................................... 20
(a) Payment Constituting Ratable Portion................................................. 20
(b) Treatment of Defaulting Bank......................................................... 21
(c) Continuing Borrower Obligation....................................................... 21
(d) Continuing Bank Obligation to Fund................................................... 21
2.6 Repayments and Prepayments.................................................................... 21
(a) Repayment............................................................................ 21
(b) Mandatory Prepayment of Revolving Credit Loans....................................... 21
(c) Mandatory Reduction of Revolving Credit Commitment................................... 22
(d) Voluntary Reduction of Revolving Credit Commitment................................... 22
(e) Permitted Prepayments................................................................ 23
(f) Extension of Commitment Period....................................................... 23
2.7 Rate Conversion and Rate Continuation......................................................... 24
2.8 Letters of Credit............................................................................. 25
(a) Term; Form and Conditions of Letters of Credit....................................... 25
(b) Requests for Letters of Credit....................................................... 26
(c) Participation by Banks in Letters of Credit.......................................... 26
(d) Reimbursement........................................................................ 27
(e) Failure to Reimburse................................................................. 27
(f) Obligations Absolute................................................................. 27
(g) Liability of Letter of Credit Bank................................................... 28
(h) Letter of Credit Bank Indemnity...................................................... 29
(i) Effect of Applicable Law or Custom................................................... 29
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Section Page
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(j) Termination of Letter of Credit Commitment........................................... 29
2.9 Fees.......................................................................................... 30
(a) Revolving Credit Commitment Fee...................................................... 30
(b) Arrangement and Structuring.......................................................... 30
(c) Annual Agent's Fee................................................................... 30
(d) Letter of Credit Fees................................................................ 30
(e) Late Charges......................................................................... 31
(f) Applicable Risk Participation Percentage and Applicable Facility Fee Percentage...... 31
(g) Payment of Fees; NonRefundable....................................................... 31
2.10 Interest on Revolving Credit Loans............................................................ 31
(a) Interest Rate........................................................................ 32
(b) Applicable LIBOR Margin; Terms of Adjustment......................................... 32
(c) Default Interest..................................................................... 33
(d) Interest Rate Determination.......................................................... 33
2.11 Payments and Computations..................................................................... 34
(a) Payments............................................................................. 34
(b) Payment Procedures................................................................... 34
(c) Authorization to Charge Account...................................................... 34
(d) Computations of Interest and Fees.................................................... 34
(e) Payment not on Business Day.......................................................... 35
(f) Presumption of Payment in Full by Borrower........................................... 35
2.12 Change in Law; LIBOR Rate Loans Unlawful...................................................... 35
2.13 Unavailability................................................................................ 36
(a) Inadequate Rate...................................................................... 36
(b) Unavailable Quotations............................................................... 36
(c) Unavailable Deposits................................................................. 36
2.14 Pro Rata Treatment............................................................................ 36
3 CONDITIONS OF LENDING.
3.1 Conditions Precedent to Initial Loans......................................................... 36
(a) This Agreement....................................................................... 36
(b) Subsidiary Guaranties................................................................ 37
(c) Corporate Action; Incumbency......................................................... 37
(d) Domestic Subsidiary - Corporate Action; Incumbency................................... 37
(e) Good Standing - Borrower............................................................. 37
(f) Good Standing - Domestic Subsidiaries................................................ 37
(g) Revolving Credit Notes............................................................... 37
(h) Legal Opinions....................................................................... 38
(i) Minimum Availability................................................................. 38
(j) Assignment Agreement................................................................. 38
(k) Consents............................................................................. 38
(l) Delivery of Financial Statements; Officer's Certificate.............................. 38
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Section Page
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(m) Credit Request and Disbursement Direction Letter..................................... 38
(n) Payment of Fees...................................................................... 38
(o) Projections.......................................................................... 39
(p) Insurance............................................................................ 39
(q) Other Information.................................................................... 39
3.2 Conditions Precedent to all Loans............................................................. 39
(a) Representation Bringdown............................................................. 39
(b) No Default; Compliance with Terms.................................................... 39
(c) No Material Adverse Effect........................................................... 39
4 GENERAL REPRESENTATIONS AND WARRANTIES.
4.1 Existence..................................................................................... 39
4.2 Authorization................................................................................. 40
4.3 Enforceability................................................................................ 40
4.4 Litigation; Proceedings....................................................................... 40
4.5 Taxes......................................................................................... 41
4.6 Title......................................................................................... 41
4.7 No Breach or Default.......................................................................... 41
4.8 Consents; Approvals........................................................................... 41
4.9 Lawful Operations............................................................................. 41
4.10 Environmental Compliance...................................................................... 41
4.11 ERISA......................................................................................... 42
4.12 Adverse Obligations; Labor Disputes........................................................... 43
4.13 Financial Statements.......................................................................... 43
4.14 Value; Solvency............................................................................... 43
4.15 Investment Company Act Status................................................................. 43
4.16 Use of Proceeds; Regulation U/Regulation X Compliance......................................... 43
4.17 Full Disclosure............................................................................... 44
5 COVENANTS OF THE BORROWER.
5.1 Reporting and Notice Covenants................................................................ 44
(a) Quarterly Financial Statements....................................................... 44
(b) Annual Financial Statements.......................................................... 44
(c) Officer's Certificates............................................................... 45
(d) Annual Business Plan................................................................. 45
(e) Other Information.................................................................... 45
(f) Projections.......................................................................... 45
(g) Notices.............................................................................. 46
(h) Notice of Default under ERISA........................................................ 46
(i) Environmental Reporting.............................................................. 46
(j) Multiemployer Plan Withdrawal Liability.............................................. 47
5.2 Affirmative Covenants......................................................................... 47
(a) Corporate Existence.................................................................. 47
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Section Page
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(b) Compliance with Law.................................................................. 47
(c) Insurance............................................................................ 47
(d) Taxes................................................................................ 48
(e) Properties; Financial Records........................................................ 48
(f) Visitation........................................................................... 48
(g) Domestic Subsidiaries as Subsidiary Guarantors....................................... 48
(h) Interest Rate Protection Agreements.................................................. 48
5.3 Negative Covenants............................................................................ 49
(a) Mergers; Sales of Assets; Fundamental Transactions................................... 49
(b) Credit Extensions; Investments....................................................... 49
(c) Indebtedness......................................................................... 50
(d) Liens; Leases........................................................................ 50
(e) Dividends............................................................................ 51
(f) Accounting Changes................................................................... 52
(g) Use of Proceeds...................................................................... 52
(h) Compliance with ERISA................................................................ 52
(i) Change in Nature of Business......................................................... 53
5.4 Financial Covenants........................................................................... 53
(a) Consolidated Total Funded Debt to EBITDA Ratio....................................... 53
(b) Consolidated Total Funded Debt....................................................... 53
6 EVENTS OF DEFAULT
6.1 Payment Failure............................................................................... 53
6.2 Representations and Warranties................................................................ 54
6.3 Reporting and Notice Provisions; Violations of Certain Affirmative Covenants.................. 54
6.4 Violation of Negative Covenants; Violation of Certain Other Covenants......................... 54
6.5 Loan Documents................................................................................ 54
6.6 Cross-Default................................................................................. 54
6.7 Termination of Existence...................................................................... 55
6.8 Control....................................................................................... 55
6.9 Failure of Enforceability of this Agreement or any Loan Document.............................. 55
6.10 Judgments..................................................................................... 55
6.11 Forfeiture Proceedings........................................................................ 55
6.12 Payments of Debts............................................................................. 55
6.13 Voluntary Proceedings......................................................................... 55
6.14 Involuntary Proceedings....................................................................... 56
7 REMEDIES
7.1 Optional Defaults............................................................................. 56
7.2 Automatic Defaults............................................................................ 56
7.3 General Rights and Remedies of Agent and the Banks............................................ 56
7.4 Set-off....................................................................................... 56
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Section Page
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7.5 Acions in Respect of the Letters of Credit upon Default........................................ 57
7.6 Letter of Credit Collateral Account............................................................ 57
(a) Application......................................................................... 57
(b) No Borrower or Third Party Claims..................................................... 57
(c) No Liens or Transfers of Account...................................................... 57
(d) Reasonable Care....................................................................... 58
7.7 Termination; Effect on Borrower Obligations.................................................... 58
7.8 Equalization................................................................................... 58
7.9 Remedies Cumulative............................................................................ 58
8 THE AGENT.
8.1 The Agent...................................................................................... 58
8.2 Nature of Appointment.......................................................................... 58
8.3 Agent as a Bank; Other Transactions............................................................ 59
8.4 Instructions from Banks........................................................................ 59
8.5 Bank's Diligence............................................................................... 59
8.6 No Implied Representations..................................................................... 59
8.7 Sub-Agents..................................................................................... 59
8.8 Agent's Diligence.............................................................................. 59
8.9 Notice of Default.............................................................................. 60
8.10 Agent's Liability.............................................................................. 60
8.11 Agent's Indemnity.............................................................................. 61
8.12 Resignation of Agent........................................................................... 61
9 TRANSFERS AND ASSIGNMENTS.
9.1 Transfer of Commitments........................................................................ 61
(a) Prior Consent......................................................................... 62
(b) Agreement; Transfer Fee............................................................... 62
(c) Revolving Credit Notes................................................................ 62
(d) Parties............................................................................... 62
9.2 Sale of Participations......................................................................... 63
(a) Benefits of Participant............................................................... 63
(b) Rights Reserved....................................................................... 63
(c) No Delegation......................................................................... 63
9.3 Confidentiality................................................................................ 63
10 INDEMNITIES.
10.1 Increased Costs................................................................................ 64
10.2 Risk-Based Capital............................................................................. 64
10.3 Taxes.......................................................................................... 64
(a) Taxes; Withholding.................................................................... 64
(b) Stamp Taxes........................................................................... 65
(c) Indemnification for Other Taxes....................................................... 65
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Section Page
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(d) Request for Refund.................................................................... 65
(e) Furnishing of Certificate............................................................. 66
(f) Exemption Certificate................................................................. 66
(g) Survival of Provision................................................................. 67
10.4 Losses......................................................................................... 67
10.5 Indemnification for Requests................................................................... 67
10.6 General Indemnity.............................................................................. 67
10.7 Environmental Indemnity........................................................................ 68
10.8 Certificate for Indemnification................................................................ 68
10.9 Duty To Mitigate; Standard Treatment........................................................... 68
11 GENERAL
11.1 Amendments and Waivers......................................................................... 68
11.2 Cumulative Provisions; Integration............................................................. 69
11.3 Binding Effect................................................................................. 69
11.4 Costs and Expenses............................................................................. 70
11.5 Survival of Provisions......................................................................... 70
11.6 Immediate U.S. Funds........................................................................... 70
11.7 Captions....................................................................................... 70
11.8 Interest Rate Limitation....................................................................... 70
11.9 Illegality..................................................................................... 70
11.10 Notices........................................................................................ 71
11.11 Governing Law.................................................................................. 71
11.12 Entire Agreement............................................................................... 71
11.13 JURY TRIAL WAIVER.............................................................................. 71
11.14 Jurisdiction; Venue; Inconvenient Forum........................................................ 71
(a) Jurisdiction.......................................................................... 71
(b) Venue; Inconvenient Forum............................................................. 72
11.15 Execution in Counterparts...................................................................... 72
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EXHIBITS AND SCHEDULES
Exhibit A (Form of Revolving Credit Note)
Exhibit B (Form of Credit Request)
Exhibit C (Form of Rate Conversion/Continuation Request)
Exhibit D (Form of Subsidiary Guaranty)
Exhibit E (Form of Acquisition Certificate)
Exhibit F (Form of Bank Assignment)
Annex I Commitments
Annex II Supplemental Schedule
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AMENDED AND RESTATED
CREDIT AGREEMENT
(U.S. $250,000,000)
DATED AS OF JANUARY 30, 1998
OM GROUP, INC., a Delaware corporation, the BANKS listed on the
signature pages of this Agreement, NATIONAL CITY BANK, a national banking
association, as Agent for the Banks under this Agreement and as Letter of Credit
Bank and ABN AMRO BANK N.V., as Co-Agent, hereby agree as follows:
1 DEFINITIONS AND ACCOUNTING TERMS.
1.1 CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ACCUMULATED FUNDING DEFICIENCY" has the meaning ascribed
thereto in section 302(a)(2) of ERISA.
"ACQUISITIONS" means the acquisition by the Borrower of (i)
Auric Corporation (d/b/a Fidelity Chemical Products Corporation), for a
purchase price not to exceed Eighty-Five Million Dollars ($85,000,000)
and (ii) Dussek Xxxxxxxx Limited, for a purchase price not to exceed
Fifteen Million Dollars ($15,000,000).
"ACQUISITION CERTIFICATE" means the certificate attached
hereto as Exhibit E with respect to the Acquisitions.
"ACQUISITION DOCUMENTS" means, with respect to each of the
Acquisitions, the purchase agreement and all documents or agreements or
instruments delivered by the Borrower or Domestic Subsidiary in
connection therewith.
"ADVANTAGE" means any payment (whether made voluntarily or
involuntarily, by offset of any deposit or other Indebtedness or
otherwise) received by a Bank in respect of the Obligations if the
payment results in any other Bank's having more than its Ratable
Portion of the Obligations in question.
"AFFILIATE" means, with respect to a specified Person, any
other Person: (a) which Controls, or is Controlled by, or is under
common Control with such specified Person.
"AGENT" means National City Bank, its successors and assigns,
in its capacity as administrative agent for the Banks.
"AGENT FEE LETTER" means that certain letter, dated January
30, 1998, from the
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Agent addressed to the Borrower and accepted by the Borrower.
"AGREEMENT" means this Amended and Restated Credit Agreement,
which amends and restates in its entirety the Existing Credit
Agreement, and each amendment, supplement or modification, if any, to
this Amended and Restated Credit Agreement.
"ALTERNATE BASE RATE" means, for any day, a rate per annum
equal to the higher of: (a) the rate of interest which is established
from time to time by NCB at its principal office in Cleveland, Ohio as
its "prime rate" or "base rate" in effect, such rate to be adjusted
automatically, without notice, as of the opening of business on the
effective date of any change in such rate (it being agreed that: (i)
such rate is not necessarily the lowest rate of interest then available
from NCB on fluctuating rate loans and (ii) such rate may be
established by NCB by public announcement or otherwise) and (b) the
Federal Funds Rate in effect on such day plus one half of one percent
(1/2 of 1%).
"ALTERNATE BASE RATE LOAN" means an Loan which bears interest
as provided in Section 0(a)(i) of this Agreement.
"ALTERNATE BASE RATE BORROWING" means a Borrowing consisting
of Alternate Base Rate Loans.
"APPLICABLE LIBOR MARGIN" means, with respect to any Margin
Adjustment Date, the percentage applicable to a LIBOR Rate Loan
corresponding to the Consolidated Total Funded Debt to EBITDA Ratio set
forth below (determined on the basis of the Consolidated Total Funded
Debt to EBITDA Ratio for the Cumulative Four Quarter Period ending on
the Determination Date applicable to such Margin Adjustment Date and
calculated in accordance with Section 0 of this Agreement):
=============================================================
Consolidated Total LIBOR Rate
Funded Debt to Margin
EBITDA Ratio
=============================================================
> 2.5 to 1.0 but < 3.0 to 1.0 .80%
-
-------------------------------------------------------------
> 2.0 to 1.0 but < 2.5 to 1.0 .65%
-
-------------------------------------------------------------
> 1.5 to 1.0 but < 2.0 to 1.0 .55%
-
-------------------------------------------------------------
< 1.5 to 1.0 .40%
=============================================================
"APPLICABLE RISK PARTICIPATION PERCENTAGE"; "APPLICABLE
COMMITMENT FEE
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PERCENTAGE" means, with respect to the risk participation fee
applicable to Standby Letters of Credit required by Section 0 of this
Agreement and the commitment fee required by Section 0(a) of this
Agreement, as the case may be, the percentage set forth in the column
below which is applicable to such risk participation fee or commitment
fee, as the case may be, and which corresponds to the Consolidated
Total Funded Debt to EBITDA Ratio set forth below (in each case
determined on the basis of the Consolidated EBITDA for the Cumulative
Four Quarter Period ending on the Determination Date applicable to such
risk participation fee or commitment fee, as the case may be, and
calculated in accordance with Section 0 of this Agreement):
================================================================================
Consolidated Total Risk Commitment
Funded Debt to Participation Fee Percentage
EBITDA Ratio Margin
===============================================================================
> 2.5 to 1.0 but < 3.0 to 1.0 .80% 0.30%
-
--------------------------------------------------------------------------------
> 2.0 to 1.0 but < 2.5 to 1.0 .65% 0.25%
-
--------------------------------------------------------------------------------
> 1.5 to 1.0 but < 2.0 to 1.0 .55% 0.20%
-
--------------------------------------------------------------------------------
< 1.5 to 1.0 .40% 0.15%
================================================================================
"BANK ASSIGNMENT AGREEMENT" has the meaning specified in
Section 0 of this Agreement.
"BANKS" means the banks listed on the signature pages hereof
and the successors thereto and assignees thereof.
"BORROW" means to obtain a Revolving Credit Borrowing.
"BORROWER" means OM Group, Inc., a Delaware corporation.
"BORROWING" means a group of Revolving Credit Loans of a
single Type made by the Banks on a single date and as to which a single
Interest Period is in effect (i.e., any group of Loans made by the
Banks of a different Type, or having a different Interest Period
(regardless of whether such Interest Period commences on the same date
as another Interest Period), or made on a different date shall be
considered to comprise a different Borrowing).
"BUSINESS DAY" means: (i) a day of the year on which banks are
not required or authorized to close in Cleveland, Ohio and (ii) if the
applicable Business Day relates to
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LIBOR Rate Loans, a day of the year which is a Business Day described
in clause (i) above and which is also a day on which dealings in Dollar
deposits are carried on in the London interbank market and banks are
open for business in London.
"CAPITALIZED LEASES" means, in respect of any Person, any
lease of property imposing obligations on such Person, as lessee of
such property, which are required in accordance with GAAP to be
capitalized on a balance sheet of such Person.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, 42 U.S.C. Sections 9601 et
seq.
"CHANGE IN CONTROL" means, if (x) any "person" or "group"
shall become the "beneficial owner" (as those terms are respectively
used in the Securities and Exchange Act of 1934, as amended, and the
rules and regulations thereunder) of more than fifty percent (50%) of
the outstanding voting stock of the Borrower or shall otherwise acquire
the power (whether by contract, by proxy or otherwise) to elect a
majority of the Borrower's board of directors or (y) during any twelve
(12) month period, individuals who were directors of the Borrower at
the beginning of such period or were elected to the Board of Directors
of the Borrower with the approval of a majority of such directors shall
cease to constitute a majority of the Board of Directors.
"CLOSING DATE" means the date and the time the initial
Revolving Credit Borrowing is advanced under this Agreement.
"CO-AGENT" means ABN Amro Bank N.V., its successors and
assigns, in its capacity as Co-Agent.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONSOLIDATED EBITDA" means, at the time and for any
Cumulative Four Quarter Period, the Consolidated Net Income for such
period plus the consolidated interest expense for such period for the
Borrower and its Subsidiaries plus the consolidated federal, state and
local income taxes for such period for the Borrower and its
Subsidiaries plus the consolidated depreciation and amortization
expense for such period for the Borrower and its Subsidiaries, each as
determined in accordance with GAAP.
"CONSOLIDATED LEASE EXPENSE" means, for any period, the amount
of lease expense of the Borrower and its Subsidiaries for such period
incurred or accrued by the Borrower and its Subsidiaries in connection
with operating leases, as determined on a consolidated basis in
accordance with GAAP.
"CONSOLIDATED NET INCOME" means, for any period, the net
income (or loss) of the Borrower and its Subsidiaries as determined on
a consolidated basis in accordance
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with GAAP, after taxes and after extraordinary items, but without
giving effect to any gain resulting from any reappraisal or write-up of
any asset.
"CONSOLIDATED NET WORTH" means, as of the date of
determination, all amounts that would be included under the caption
"shareholders' equity" (or any like caption) on a balance sheet of the
Borrower determined on a consolidated basis in accordance with GAAP as
at such date.
"CONSOLIDATED TOTAL FUNDED DEBT" means, Indebtedness of the
Person in question, including, without limitation, (a) any Capitalized
Lease, (b) any Guaranty of Indebtedness owing by another Person and (c)
any long-term Indebtedness secured by a Lien encumbering any property
owned or being acquired by the Person in question even if the full
faith and credit of that person or entity is not pledged to the payment
thereof.
"CONSOLIDATED TOTAL FUNDED DEBT TO EBITDA RATIO" means, as at
the end of any Fiscal Quarter, the ratio of: (a) the aggregate
principal amount of the Consolidated Funded Debt outstanding as of the
end of such Fiscal Quarter to (b) the Consolidated EBITDA for the
Cumulative Four Quarter Period then ended.
"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 the ownership of voting securities, by
contract or otherwise.
"CONTROL ACCOUNT" has the meaning set forth in Section 0 of
this Agreement and maintained by the Agent in respect of Revolving
Credit Borrowings.
"CREDIT EVENT" means: (a) the incurrence of the obligation of
each Bank to make a Revolving Credit Loan on the occasion of each
Revolving Credit Borrowing or Rate Conversion or Rate Continuation; (b)
the making by any Bank of a Revolving Credit Loan or the issuance by
the Letter of Credit Bank of any Letter of Credit; (c) the delivery by
the Borrower of (i) a Credit Request requesting a Revolving Credit
Borrowing or the issuance of a Letter of Credit or (ii) a Rate
Conversion/Continuation Request requesting the conversion or
continuation of Revolving Credit Borrowings; (d) a Rate Conversion or
Rate Continuation, and (e) the acceptance by the Borrower of proceeds
of any Revolving Credit Borrowing.
"CREDIT REQUEST" has the meaning specified in Section 0(a) of
this Agreement with respect to a request by the Borrower for a
Revolving Credit Borrowing.
"CUMULATIVE FOUR QUARTER PERIOD" means, with respect to any
date of determination, the period consisting of the four consecutive
Fiscal Quarters immediately preceding any such date of determination,
whether such quarters are in the same Fiscal Year of the Borrower or
different Fiscal Years of the Borrower.
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"DEEMED CREDIT REQUEST" has the meaning specified in Section
0(b) of this Agreement.
"DEFAULT UNDER ERISA" means (a) the occurrence or existence of
a material Accumulated Funding Deficiency in respect of any of the
Borrower's or its Subsidiaries' Pension Plans, (b) any material failure
by the Borrower or any of its Subsidiaries to make a full and timely
payment of premiums required by ERISA for insurance against any
employer's liability in respect of any such plan, (c) any material
breach of a fiduciary duty by the Borrower or any of its Subsidiaries
or any trustee in respect of any such plan or (d) the existence of any
action for the forcible termination of any such plan.
"DETERMINATION DATE" has: (i) in respect of a Margin
Adjustment Date in respect of an Applicable LIBOR Margin, the meaning
specified in Section 0, (ii) in respect to any Fee Adjustment Date in
respect of an Applicable Risk Participation Percentage or an Applicable
Facility Fee Percentage, the meaning specified in Section 0(f) of this
Agreement.
"DOLLAR EQUIVALENT" means, on any date of determination, with
respect to any amount in any covenant and relating to a Subsidiary
which is not a Domestic Subsidiary, the equivalent in Dollars of such
amount, determined by the Agent using the Exchange Rate with respect to
such currency then in effect.
"DOLLARS", "U.S. DOLLARS" and the sign "$" each means lawful
money of the United States.
"DOMESTIC SUBSIDIARY" means each Subsidiary of the Borrower
which is (i) wholly-owned by the Borrower, directly or through one or
more other wholly-owned Subsidiaries and (ii) organized under the laws
of any state of the United States.
"DOMESTIC SUBSIDIARY CERTIFICATE" means a certificate,
together with all of the attachments thereto, substantially in the form
of the certificates delivered by the Borrower pursuant to Section 0
"ENVIRONMENTAL LAWS" means CERCLA, the Hazardous Material
Transportation Act (49 USC 1801 et seq.), RCRA, the Federal Water
Pollution Control Act (33 USC 1251 et seq.), the Toxic Substances
Control Act (15 USC 2601 et seq.) and the Occupational Safety and
Health Act (29 USC 651 et seq.), as such laws have been or hereafter
may be amended, and any and all analogous present or future
environmental Law.
"ERISA" means the Employee Retirement Income Security Act of
1974 (Public Law 93-406), as amended, and in the event of any amendment
affecting any section
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thereof referred to in this Agreement, that reference shall be
reference to that section as amended, supplemented, replaced or
otherwise modified.
"ERISA AFFILIATE" of any Person means any other Person that
for purposes of Title IV of ERISA is a member of such Person's
controlled group, or under common control with such Person, within the
meaning of Section 414 of the Code.
"ERISA REGULATOR" means any governmental agency (such as the
Department of Labor, the Internal Revenue Service and the Pension
Benefit Guaranty Corporation) having any regulatory authority over any
Employee Benefit Plan.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"EUROCURRENCY RESERVE PERCENTAGE" means, for any Interest
Period in respect of any LIBOR Rate Loan, as of any date of
determination, the aggregate of the then stated maximum reserve
percentages (including any marginal, special, emergency or supplemental
reserves), expressed as a decimal, applicable to such Interest Period
(if more than one such percentage is applicable, the daily average of
such percentages for those days in such Interest Period during which
any such percentages shall be so applicable) by the Board of Governors
of the Federal Reserve System, any successor thereto, or any other
banking authority, domestic or foreign, to which the Agent or any Bank
may be subject in respect to eurocurrency funding (currently referred
to as "Eurocurrency Liabilities" in Regulation D of the Federal Reserve
Board) or in respect of any other category of liabilities including
deposits by reference to which the interest rate on LIBOR Rate Loans is
determined or any category of extension of credit or other assets that
include the LIBOR Rate Loans. For purposes hereof, such reserve
requirements shall include, without limitation, those imposed under
Regulation D of the Federal Reserve Board and the LIBOR Rate Loans
shall be deemed to constitute Eurocurrency Liabilities subject to such
reserve requirements without benefit of credits for proration,
exceptions or offsets which may be available from time to time to any
Bank under said Regulation D.
"EVENT OF DEFAULT" has the meaning specified in Section 0 of
this Agreement.
"EXCHANGE RATE" means, with respect to any currency other than
Dollars on a particular date, the rate at which such currency may be
exchanged into Dollars, as set forth on such date on the relevant
Reuters currency page at or about 11:00 a.m. London time, on such date.
In the event that such rate does not appear on any Reuters currency
page, the "Exchange Rate" with respect to such currency shall be
determined by reference to such other publicly available service for
exchange rates as may be agreed upon by the Agent and the Borrower or,
in the absence of such agreement, such "Exchange Rate"
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shall instead be the Agent's spot rate of exchange in the market which
its foreign currency exchange operations are then being conducted, at
or about 10:00 A.M., local time, on such date for the purchase of
Dollars with such Alternate Currency, for delivery two (2) Business
Days later; provided, that if at the time of any such determination, no
such spot rate can be reasonably quoted, the Agent may use any
reasonable method as it deems applicable to determine such rate, and
such determination shall be conclusive absent manifest error.
"EXISTING CREDIT AGREEMENT" means that certain Second Amended
and Restated Credit Agreement, dated as of January 21, 1997, among the
Borrower, NCB as Agent, and the banks which are signatories thereto.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest one hundredth of one
percent (1/100th 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 on the Business Day
next succeeding such day, provided that: (a) if the day for which such
rate is to be determined is not a Business Day, the Federal Funds Rate
for such day shall be such a rate on such transactions on the
immediately preceding Business Day as so published on the next
succeeding Business Day and (b) if such rate is not so published for
any Business Day, the Federal Funds Rate for such Business Day shall be
the average of quotations for such day on such transactions received by
the Agent from three Federal funds brokers of recognized standing
selected by the Agent.
"FEE ADJUSTMENT DATE" has the meaning specified in Section 0
of this Agreement.
"FEE DETERMINATION DATE" has the meaning specified in Section
0 of this Agreement.
"FISCAL QUARTER" means any of the four consecutive three-month
fiscal accounting periods of the Borrower ending on March 31, June 30,
September 30 and December 31 of each calendar year.
"FISCAL YEAR" means the Borrower's regular annual accounting
period for federal income tax purposes ending on December 31 of each
calendar year.
"GAAP" means generally accepted accounting principles
consistent with those applied in the preparation of the financial
statements referred to in Section 0 of this Agreement and otherwise
consistently applied.
"GUARANTOR" means a Person who pledges his credit or property
in any manner
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for the payment or other performance of Indebtedness, agreements or
other obligation of another Person including, without limitation, any
guarantor (whether of collection or payment), any obligor in respect of
a standby letter of credit or surety bond issued for the account of
another Person, any surety, any co-maker, any endorser, and any Person
who agrees conditionally or otherwise to make any loan, purchase or
investment in order to enable another Person to prevent or correct a
default of any kind or otherwise to assure a creditor against loss in
respect of such Indebtedness, agreements or obligations.
"GUARANTY" means the obligations undertaken by a Guarantor.
"INDEBTEDNESS" means, with respect to any Person, without
duplication, (a) indebtedness for borrowed money, (b) obligations of
such Person evidenced by bonds, debentures, notes or other similar
instruments, (c) obligations of such Person for the deferred purchase
price of property or services with a stated maturity of greater than
twelve (12) months, (d) obligations of such Person as lessee under
leases which shall have been or should be, in accordance with GAAP,
recorded as capital leases, (e) all obligations of such Person as an
account party in respect of letters of credit or banker's acceptances,
(f) obligations of a third party secured by any Lien on the properties
or assets of such Person and (g) obligations under any direct or
indirect Guaranty in respect of indebtedness or obligations of a third
party of the kinds referred to in clauses (a) through (g) above.
"INTELLECTUAL PROPERTY" means all inventions, designs,
patents, and applications therefor, trademarks, service marks, trade
names, and registrations and applications therefor, copyrights, any
registrations therefor, and any licenses thereof, whether now owned or
existing or hereafter arising or acquired other than those which are
owned, existing or acquired outside of the United States.
"INTEREST PERIOD" means, for each LIBOR Rate Loan comprising a
Borrowing, the period commencing on the date of such LIBOR Rate Loan or
the date of the Rate Conversion or Rate Continuation of any Loans into
such LIBOR Rate Loan and ending on the numerically corresponding day of
the period selected by the Borrower pursuant to the provisions hereof
and each subsequent period commencing on the last day of the
immediately preceding Interest Period in respect of such LIBOR Rate
Loan and ending on the last day of the period selected by the Borrower
pursuant to the provisions hereof; provided, however, that the duration
of each such Interest Period shall be one, two, three or six months, in
each case as the Borrower may select by delivery to the Agent of a
Credit Request therefor in accordance with Section 0 of this Agreement
and; provided, further, that:
(i) Interest Period for each LIBOR Rate Loan comprising
part of the same Borrowing shall be of the same
duration;
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(ii) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day,
the last day of such Interest Period shall be
extended to occur on the next succeeding Business
Day; provided, however, that, if such extension would
cause the last day of such Interest Period to occur
in the next following calendar month, the last day of
such Interest Period shall occur on the immediately
preceding Business Day;
(iii) if the Interest Period commences on a Business Day
for which there is no numerical equivalent in the
calendar month in which the Interest Period is to
end, such Interest Period shall end on the last
Business Day of that calendar month; and
(iv) with respect to LIBOR Rate Loans comprising any
Revolving Credit Borrowing, no Interest Period may
end on a date later than the Revolving Credit
Termination Date.
"LAW" means any law, treaty, regulation, statute or ordinance,
common law, civil law, or any case precedent, ruling, requirement,
directive or request having the force of law of any foreign or domestic
governmental authority, agency or tribunal.
"LC COMMITMENT" means the obligation of the Letter of Credit
Bank under this Agreement to issue Letters of Credit for the account of
the Borrower in an aggregate amount of up to Ten Million Dollars
($10,000,000).
"LC EXPOSURE" means, with respect to any Bank, at any time of
determination, such Bank's Ratable Portion of the sum of: (a) the
aggregate undrawn amount of all Letters of Credit outstanding at such
time and (b) the aggregate amount that has been drawn under such
Letters of Credit which the Letter of Credit Bank or the Banks, as the
case may be, have not at such time been reimbursed by the Borrower.
"LENDING OFFICE" means, with respect to any Bank, the office
of such Bank specified as its "Lending Office" under its name on the
signature pages hereto, or such other office of such Bank as such Bank
may from time to time specify in writing to the Borrower and the Agent
as the office at which Loans are to be made and maintained.
"LETTER OF CREDIT" means any Trade Letter of Credit or Standby
Letter of Credit.
"LETTER OF CREDIT BANK" means National City Bank, its
successors and assigns, in its capacity as issuer of Letters of Credit.
"LETTER OF CREDIT COLLATERAL ACCOUNT" has the meaning
specified in Section 0 of this Agreement.
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"LIBOR RATE LOAN" means a Loan which bears interest as
provided in Section 0(a)(ii) of this Agreement.
"LIBOR RATE BORROWING" means a Borrowing consisting of LIBOR
Rate Loans.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, including, without limitation, the lien or
retained security title of a conditional vendor and any easement, right
of way or other encumbrance on title to real property.
"LOAN" means a Revolving Credit Loan.
"LOAN ACCOUNT" has the meaning specified in Section 0 of this
Agreement.
"LOAN DOCUMENTS" means any note, security agreement, or other
lien instrument, reimbursement agreement, financial statement, audit
report, environmental audit, notice, request of advance, interest rate
swap or hedge agreement, officer's certificate or other writing of any
kind which is now or hereafter required to be delivered by or on behalf
of the Borrower to the Agent or the Banks under this Agreement and
includes, without limitation, the Revolving Credit Notes and the other
writings referred to in Sections 0 and 0 of this Agreement.
"LONDON INTERBANK OFFERED RATE" means, for any Interest Period
with respect to a LIBOR Rate Borrowing, the quotient (rounded upwards,
if necessary, to the nearest one sixteenth of one percent (1/16th of
1%)) of: (x) the per annum rate of interest, determined by the Agent in
accordance with its usual procedures (which determination shall be
conclusive absent manifest error) as of approximately 11:00 a.m.
(London time) two Business Days prior to the beginning of such Interest
Period pertaining to such LIBOR Rate Loan, appearing on Page 3750 of
the Telerate Service (or any successor or substitute page of such
Service, or any successor to or substitute for such Service providing
rate quotations comparable to those currently provided on such page of
such Service, as determined by the Agent from time to time for purposes
of providing quotations of interest rates applicable to Dollar deposits
in the London interbank market) as the rate in the London interbank
market for Dollar deposits in immediately available funds with a
maturity comparable to such Interest Period divided by (y) a number
equal to 1.00 minus the Eurocurrency Reserve Percentage. In the event
that such rate quotation is not available for any reason, then the rate
(for purposes of clause (x) hereof) shall be the rate, determined by
the Agent as of approximately 11:00 a.m. (London time) two Business
Days prior to the beginning of such Interest Period pertaining to such
LIBOR Rate Loan, to be the average (rounded upwards, if necessary, to
the nearest one sixteenth of one percent (1/16th of 1%) of the per
annum rates at which Dollar deposits in immediately available funds in
an amount comparable to NCB's Ratable Portion of such LIBOR Borrowing
and with a maturity comparable to such Interest Period are offered to
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the prime banks by leading banks in the London interbank market. The
London Interbank Offered Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurocurrency Reserve
Percentage.
"MARGIN ADJUSTMENT DATE" has the meaning specified in Section
0 of this Agreement.
"MATERIAL ADVERSE EFFECT" means, as to any event, occurrence
or condition, if the result thereof would, either singly or in the
aggregate, have a material adverse effect on: (i) the business,
operations, profitability or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole, (ii) the Borrower's
ability to repay the Obligations or (iii) the legality, validity or
enforceability of this Agreement or the Loan Documents or the rights
and remedies of the Agent and the Banks.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan which is
a "multiemployer plan" as such term is defined in section 4001(a)(3) of
ERISA.
"NET PROCEEDS" means (i) the cash proceeds (including cash
proceeds subsequently received in respect of non-cash consideration
initially received) from any sale, transfer or other disposition (other
than (a) any sale of Inventory in the ordinary course, (b) disposition
in the ordinary course of Borrower's business of assets that are
obsolete, worn out or no longer used or useful in the Borrower's or its
Subsidiaries' business and (c) disposition of capital assets the
proceeds of which are reinvested within a reasonable period of time in
capital assets of the Borrower or its Subsidiaries) of any asset of the
Borrower or any of its Subsidiaries to any Person (other than the
Borrower or any other Subsidiary of the Borrower) the value of which
asset or assets exceeds Five Million Dollars ($5,000,000) in any
calendar year net of (x) selling expenses, including without limitation
any reasonable broker's fees or commissions, costs of discontinuing
operations associated with such assets and sales, transfer and similar
taxes, and (y) the repayment of any Indebtedness secured by a purchase
money Lien on such assets that is permitted under this Agreement; and
(ii) the cash proceeds from the issuance and/or sale of pari passu debt
securities of the Borrower pursuant to any public offering, private
placement, net of transaction costs and net of expenses including,
without limitation, underwriters' or placement agents' discounts and
commissions and transfer and similar taxes.
"NCB" means National City Bank, its successors and assigns, in
its capacity as a Bank.
"NOTE PURCHASE AGREEMENT" means that certain Note Purchase
Agreement dated as of August 30, 1995, as amended by that certain
Amendment to Note Purchase Agreement, dated as of January 21, 1997,
entered into between and among the Borrower and the Noteholders.
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"NOTEHOLDERS" means the Great-West Life and Annuity Insurance
Company, The Mutual Life Insurance Company of New York, and Nationwide
Life Insurance Company.
"OBLIGATIONS" means the present and future obligations of the
Borrower and its Subsidiaries under this Agreement including, without
limitation, (a) the outstanding principal and accrued interest
(including interest accruing after a petition for relief under the
federal bankruptcy laws has been filed) in respect of any Revolving
Credit Loans; (b) fees owing to the Banks or the Agent under this
Agreement or any Loan Document; (c) any costs and expenses reimbursable
to the Banks, the Letter of Credit Bank and the Agent pursuant to
Section 0 of this Agreement; (d) Taxes, Other Taxes, compensation,
indemnification obligations or other amounts owing by the Borrower to
the Agent, the Letter of Credit Bank or the Banks under this Agreement
or any Loan Document; and (e) the amounts owing to any of the Banks by
the Borrower and its Subsidiaries under any interest rate swap
agreement or similar interest rate hedge in connection with Loans under
this Agreement.
"OPERATING ACCOUNT" means an account maintained by and in the
name of the Borrower at the Payment Office of the Agent, as Agent for
the benefit of the Banks, for the purposes of disbursing the proceeds
of Revolving Credit Loans, which account shall in no case be a payroll
account.
"OTHER TAXES" has the meaning specified in Section 0 of this
Agreement.
"PAYMENT OFFICE" means such office of the Agent as set forth
on the signature page of the Agent or such offices as may be from time
to time selected by the Agent and notified in writing by the Agent to
the Borrower and the Banks as the office to which payments are to be
made to the Agent by the Borrower or the Banks, as the case may be.
"PBGC" means the Pension Benefit Guaranty Corporation or any
other governmental authority succeeding to any of its functions.
"PENSION PLAN" means a defined benefit plan (as defined in
section 3(35) of ERISA) of a Company and includes, without limitation,
any such plan that is a multi-employer plan (as defined in section
3(37) of ERISA) applicable to any of the Borrower or its Subsidiaries'
employees.
"PERMITTED FOREIGN INVESTMENTS" means certificates of deposit
issued by any Bank or by any other financial institution not organized
under the laws of the United States or any state thereof having a
combined capital and surplus aggregating at least Three Hundred Fifty
Million Dollars ($350,000,000), or any other money-market investment if
it carries the highest quality of rating of any nationally recognized
rating agency or any repurchase agreements issued by banks continuously
secured by
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obligations issued or guaranteed and backed by the full faith and
credit of the central bank or national treasury of a country other than
the United States of America; provided, however, that no such security
shall mature more than ninety (90) days after the date when made.
"PERMITTED US INVESTMENTS" means securities that are direct
obligations of the United States of America or any agency thereof, or
certificates of deposit issued by any Bank or by any other financial
institution organized under the laws of the United States or any state
thereof having a combined capital and surplus aggregating at least
Three Hundred Fifty Million Dollars ($350,000,000), or any other
money-market investment if it carries the highest quality of rating of
any nationally recognized rating agency or any repurchase agreements
issued by banks continuously secured by obligations issued or
guaranteed and backed by the full faith and credit of the United States
of America; provided, however, that no such security shall mature more
than ninety (90) days after the date when made.
"PERSON" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"POTENTIAL DEFAULT" means an event, condition or thing which
with the lapse of any applicable grace period or with the giving of
notice or both would constitute, an Event of Default referred to in
Section 0 of this Agreement and which has not been appropriately waived
in writing in accordance with this Agreement or fully corrected, prior
to becoming an actual Event of Default.
"PROFORMA COVENANT COMPLIANCE" means compliance by Borrower
and its Subsidiaries with the general financial standards contained in
Section 0 of this Agreement as of the time of the event in question and
for the following twelve (12) month period based upon the Projections
delivered by Borrower in contemplation of such event pursuant to
Section 0 if the same are requested by a Bank and otherwise consistent
with Borrower's internally generated and used projections.
"PROJECTIONS" has the meaning ascribed to that term in Section
0.
"PROPERTIES" has the meaning specified in Section 0 of this
Agreement.
"RATABLE PORTION" means, in respect of any Bank, the quotient
(expressed as a percentage) obtained at any time by dividing: (i) such
Bank's Revolving Credit Commitment at such time by (ii) the sum of the
aggregate amount of the Revolving Credit Commitments of all of the
Banks at such time; provided; however, if all of the Revolving Credit
Commitments are terminated pursuant to the terms hereof, then, Ratable
Portion means the quotient (expressed as a percentage) obtained by
dividing (x)
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the aggregate amount of such Bank's Revolving Credit Loans by (y) the
aggregate amount of Revolving Credit Loans of all of the Banks
outstanding at such time.
"RATE CONTINUATION" means, in respect of LIBOR Rate Loans
having a particular Interest Period, a continuation of such LIBOR Rate
Loans pursuant to Section 0 of this Agreement as LIBOR Rate Loans with
an Interest Period of the same duration.
"RATE CONVERSION" means a conversion pursuant to Section 0 of
this Agreement of Loans of one Type into Loans of another Type and,
with respect to LIBOR Rate Loans, from one permissible Interest Period
to another permissible Interest Period.
"RATE CONVERSION/CONTINUATION REQUEST" has the meaning
specified in Section 0 of this Agreement.
"RCRA" means the Resource Conservation and Recovery Act, 42
U.S.C. Sections 6901 et seq.
"REGULATORY CHANGE" means, as to any Bank, any change in
United States federal, state or foreign Laws or regulations or the
adoption or making of any interpretations, directives or requests of or
under any United States federal, state or foreign Laws or regulations
(whether or not having the force of Law) by any court or governmental
authority charged with the interpretation or administration thereof.
"REIMBURSEMENT AGREEMENT" has the meaning set forth in Section
0 of this Agreement.
"REPORTABLE EVENT" means any of the events set forth in
Section 4043 of ERISA excluding those events for which the requirement
of notice has been waived by the PBGC.
"REQUIRED BANKS" means, at any time, (a) Banks (excluding, for
the purposes of this definition, Banks then constituting "defaulting
Banks" under Section 0) holding at least sixty six and two thirds
percent (66-2/3rds%) of the aggregate outstanding principal amount of
Loans of all of the Banks at such time or (b) if no principal amount is
then outstanding, Banks having at least sixty six and two thirds
percent (66-2/3rds%) of the Revolving Credit Commitments at such time,
of all of the Banks at such time.
"REVOLVING CREDIT BORROWING" means an Alternate Base Rate
Borrowing or a LIBOR Rate Borrowing, as the case may be.
"REVOLVING CREDIT COMMITMENT" means, in respect of a Bank, the
obligation of such Bank hereunder to make Revolving Credit Loans as
hereinafter provided, and to participate in the risks of all Letters of
Credit issued by the Letter of Credit Bank up to an
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amount equal to the Revolving Credit Commitment of such Bank as set
forth in Annex I and as further specified in Section 0 of this
Agreement and as such Revolving Credit Commitment may be reduced from
time to time in accordance with Section 0 hereof.
"REVOLVING CREDIT LOAN" means an Loan made by a Bank to the
Borrower pursuant to Section 0 of this Agreement.
"REVOLVING CREDIT NOTE" means a promissory note of the
Borrower payable to the order of a Bank, in substantially the form of
Exhibit A-1 hereto and in the original principal amount of such Bank's
Revolving Credit Commitment, evidencing the aggregate indebtedness of
the Borrower to such Bank resulting from the Revolving Credit Loans
made by such Bank.
"REVOLVING CREDIT TERMINATION DATE" means the earlier of: (i)
__________ __, 2003, as extended pursuant to Section 0 of this
Agreement or (ii) the earlier date of the termination of the Revolving
Credit Commitments pursuant to Section 0 or Section 0 of this
Agreement.
"SOLVENT" means, with respect to any Person, on any date of
determination, that on such date: (a) fair value of the property of the
Person is greater than the total amount of liabilities (including
contingent liabilities) of the Person, (b) the present fair salable
value of the assets of the Person is not less than the amount that will
be required to pay the probable liability of the Person on its debts as
they become absolute and matured, (c) the Person is able to pay all
liabilities of the Person as those liabilities mature, and (d) the
Person does not have unreasonably small capital for the business in
which it is engaged or for any business or transaction in which it is
about to engage.
"STANDBY LETTER OF CREDIT" means any letter of credit issued
by the Letter of Credit Bank from time to time at the request of the
Borrower pursuant to the terms of this Agreement which letter of credit
is not a Trade Letter of Credit.
"SUBSIDIARY" means, in respect of a corporate Person, a
corporation or other business entity the shares constituting a majority
of the outstanding capital stock (or other form of ownership) or
constituting a majority of the voting power in any election of
directors (or shares constituting both majorities) of which are (or
upon the exercise of any outstanding warrants, options or other rights
would be) owned directly or indirectly at the time in question by such
Person or another subsidiary of such Person or any combination of the
foregoing.
"SUBSIDIARY GUARANTOR" means each of OMG Americas, Inc., an
Ohio corporation, OMG Apex, Inc., a Delaware corporation, SCM Metal
Products Inc., a Delaware corporation, and any other Domestic
Subsidiary of the Borrower existing on the Closing Date or thereafter
created.
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"SUBSIDIARY GUARANTY" means, the form of guaranty agreement
attached hereto as Exhibit D.
"SUPPLEMENTAL SCHEDULE" means the schedule which is attached
hereto as Annex II and is incorporated into this Agreement.
"TAXES" has the meaning specified in Section 0(a) of this
Agreement.
"TRADE LETTER OF CREDIT" means any trade letter of credit
issued by the Letter of Credit Bank from time to time at the request of
the Borrower pursuant to the terms of this Agreement for the purpose of
purchasing goods or services in the ordinary course of business.
"TYPE" means, when used in respect of any Loan, the London
Interbank Offered Rate or the Alternate Base Rate in effect in respect
of such Loan.
"UCC" means the Uniform Commercial Code in effect in the State
of Ohio from time to time.
"UNITED STATES" and "U.S." each means United States of
America.
1.2 COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".
1.3 ACCOUNTING TERMS. All accounting and financial terms not
specifically defined herein shall be construed in accordance with GAAP as in
effect from time to time. In all cases, such accounting and financial terms
shall be applied on a basis consistent with those applied in the preparation of
the Borrower's audited financial statements for the Fiscal Year ending December
31, 1996; provided, however, (a) that all financial statements shall reflect the
Borrower's adoption of FAS 106 and (b) if any change in GAAP in itself
materially affects the calculation of any financial covenant in Section 0 of
this Agreement, the Borrower may by written notice to the Agent, or the Agent
(upon request by the Required Banks), may by written notice to the Borrower,
require that such covenant thereafter be calculated in accordance with GAAP as
in effect. If any such notice is given, the compliance certificates delivered
pursuant to Section 0 of this Agreement after such change occurs shall be
accompanied by reconciliations of the difference between the calculation set
forth therein and a calculation made in accordance with GAAP as in effect from
time to time after such change occurs.
1.4 DOLLAR EQUIVALENTS. Each reference herein to an amount stated
Dollars shall be a reference to Dollars or the Dollar Equivalent of such amount
unless the context dictates otherwise.
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2 STATEMENT OF TERMS.
2.1 REVOLVING CREDIT FACILITY.
(a) REVOLVING CREDIT LOANS. Subject to the terms and
conditions set forth in this Agreement, each Bank severally agrees to
make, from time to time on and after the Closing Date and up to but
excluding the Business Day immediately preceding the Revolving Credit
Termination Date, advances to or for the account of the Borrower on a
revolving credit basis (each a "Revolving Credit Loan"); that the
outstanding principal amount of Revolving Credit Loans made by or on
behalf of such Bank, when taken together with the outstanding principal
amount of all Revolving Credit Loans made by or on behalf of such Bank,
shall not exceed the amount of such Bank's Revolving Credit Commitment
in effect at such time minus the LC Exposure of such Bank at such time.
Within the limits set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Credit Loans.
(b) REVOLVING CREDIT BORROWINGS. Each Revolving Credit
Borrowing shall be: (i) if comprised of Alternate Base Rate Loans, in
an aggregate amount of not less than One Hundred Thousand Dollars
($100,000) or an integral multiple thereof and (ii) if comprised of
LIBOR Rate Loans, in an aggregate amount of not less than One Million
Dollars ($1,000,000) or an integral multiple of One Hundred Thousand
Dollars ($100,000) in excess thereof. The Borrower shall be entitled to
have more than one Revolving Credit Borrowing outstanding at one time;
provided, however, that the Borrower shall not be entitled to request
any Revolving Credit Borrowing which, together with all outstanding
Revolving Credit Borrowings, would result in any Bank's having an
aggregate of more than six (6) LIBOR Rate Loans outstanding at any one
time.
(c) REVOLVING CREDIT NOTES; LOAN ACCOUNT. Each Bank's
Revolving Credit Loans shall be evidenced at all times by a Revolving
Credit Note. Each Revolving Credit Note shall: (i) be executed and
delivered by the Borrower and payable to the order of such Bank, (ii)
be in a stated principal amount equal to the amount of such Bank's
Revolving Credit Commitment in effect at the execution and delivery of
such Bank's Revolving Credit Note, (iii) mature on the Revolving Credit
Termination Date, (v) bear interest as provided in Section 0, (vi) be
subject to mandatory repayment as provided in Sections 0 and 0 of this
Agreement and (vii) be entitled to the benefits of this Agreement and
the Loan Documents. Whenever the Borrower obtains a Revolving Credit
Borrowing, each Bank shall endorse an appropriate entry on such Bank's
Revolving Credit Note or make an appropriate entry in a loan account
(the "Loan Account") maintained in such Bank's books and records, or
both, to evidence such Bank's Revolving Credit Loans comprising part of
a Revolving Credit Borrowing. The Loan Account shall also evidence: (i)
accrued interest on the Revolving Credit Loans of such Bank, (ii) all
other amounts due to such Bank in respect of such Revolving Credit
Loans and (iii) all
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payments made by the Borrower received by such Bank from the Agent for
application to such Revolving Credit Borrowings. Each entry on such
Bank's Revolving Credit Note or in such Bank's books and records or
Loan Account shall be prima facie evidence of the data entered. Such
entries shall not be a condition to the Borrower's obligation to repay
the Obligations.
(d) CONTROL ACCOUNT MAINTAINED BY AGENT. The Agent shall
maintain on its books and records a control account (the "Control
Account") in respect of the Borrower and the Revolving Credit
Borrowings hereunder in which the Agent shall record: (i) advances of
Revolving Credit Borrowings to the Borrower, (ii) the Ratable Portion
of each Bank in the outstanding Revolving Credit Borrowings, (iii) the
amounts of any Collections and Remittances received and credited to
reduce the Revolving Credit Loans and (iv) the Ratable Portion of each
Bank in such credited Collections and Remittances. Each entry by the
Agent in the Control Account shall be prima facie evidence of the data
entered, absent manifest error.
2.2 CREDIT REQUESTS. Each Revolving Credit Loan shall be made upon
request of a Borrower in accordance with clause (a) below or upon a request
deemed to be made pursuant to clause (b) below:
(a) CREDIT REQUESTS EXECUTED BY THE BORROWER. Requests for
Revolving Credit Loans comprising a Revolving Credit Borrowing shall be
given by the Borrower to the Agent not later than 12:00 noon
(Cleveland, Ohio time): (i) on the Business Day which is the requested
date of a proposed Alternate Base Rate Borrowing comprised of Alternate
Base Rate Loans (the Revolving Credit Borrowing made on the Closing
Date must consist entirely of Alternate Base Rate Loans) and (ii) on
the Business Day which is three (3) Business Days before the requested
date of a proposed LIBOR Rate Borrowing. Except as herein after
permitted, each such request (a "Credit Request") for a Revolving
Credit Borrowing shall be in writing signed by the Borrower and
transmitted by the Borrower to the Agent by telecopier, telex or cable
(in the case of telex or cable, confirmed in writing prior to the date
of the requested Revolving Credit Borrowing), in substantially the form
of Exhibit B hereto. Each Credit Request shall specify: (A) the
requested date of the Revolving Credit Borrowing, (B) the aggregate
amount of such Revolving Credit Borrowing, (C) whether such Revolving
Credit Borrowing is to be comprised of Alternate Base Rate Loans or
LIBOR Rate Loans, and (D) in the case of a proposed LIBOR Rate
Borrowing, the initial Interest Period for such LIBOR Rate Borrowing.
Each Credit Request shall be irrevocable and binding on the Borrower
and be subject to the indemnification provisions of Section 0 of this
Agreement. The Borrower may give a Credit Request telephonically so
long as: (I) a written Credit Request confirmation is received by the
Agent by 1:00 p.m. (Cleveland, Ohio time) on the same day such
telephonic Credit Request was given and (II) that the other
requirements of this Section are satisfied. The Agent may rely on such
telephonic Credit Request to the same extent that the Agent may rely on
a written Credit Request. The
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Borrower shall bear all risks related to the giving of a Credit Request
by the Borrower whether given telephonically or by such other method of
transmission as the Borrower shall elect.
(b) REQUESTS FOR REVOLVING CREDIT BORROWING DEEMED GIVEN. The
Borrower shall be deemed to have made a request for a Borrowing (a
"Deemed Credit Request"), which Deemed Credit Request shall be deemed
to be irrevocable, upon the occurrence of any of the following and the
Banks agree that on the specified date of such occurrence, the Banks
will make the requested Loans pursuant to the Deemed Credit Request and
that the Banks' obligation to make such Loans is absolute and
unconditional and shall not be affected by any event or circumstance
whatsoever, including the occurrence of any Potential Default or Event
of Default hereunder or the failure of any condition precedent set
forth in Section 0 of this Agreement to be satisfied and each such
payment shall be made without any offset, abatement, withholding or
reduction whatsoever:
(i) LETTER OF CREDIT DRAWING. As specified in Section
0 of this Agreement, upon a drawing under a Letters of Credit,
the Borrower shall be deemed to have made a request for an
Alternate Base Rate Borrowing in an amount equal to the amount
necessary either to reimburse the Letter of Credit Bank for
such drawing upon the Letter of Credit together with accrued
interest thereon or, if reimbursement of the Letter of Credit
Bank is made by the Banks for any reason, reimburse the Banks
for such payment.
(ii) PAYMENT OF INTEREST AND OBLIGATIONS. Unless
payment is otherwise made by the Borrower, upon any such
interest or fee hereunder becoming due without payment by the
Borrower, the Borrower shall be deemed to have made a request
for an Alternate Base Rate Borrowing in an amount equal to the
amount necessary to pay such interest or fee.
Each Bank acknowledges and agrees that its obligation to participate in and make
Loans comprising a Borrowing pursuant to a Deemed Credit Request is absolute and
unconditional and shall not be affected by any event or circumstance whatsoever,
including the occurrence of any Potential Default or Event of Default hereunder
or the failure of any condition precedent set forth in Section 0 of this
Agreement to be satisfied at the time of the making of such Deemed Credit
Request, and each Loan made by a Bank in satisfaction of its obligation shall be
made without any offset, abatement, withholding or reduction whatsoever.
2.3 FUNDING OF REVOLVING CREDIT LOANS. The Agent shall notify each
Bank of such Credit Request promptly on the date received by telecopy, telephone
or similar form of transmission. Each Bank shall, before 3:00 p.m. (Cleveland,
Ohio time) on the date of each Revolving Credit Borrowing requested, make
available to the Agent, in immediately available funds at the account of the
Agent maintained at the Payment Office of the Agent, such Bank's
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Ratable Portion of the Revolving Credit Borrowing. On the date requested by the
Borrower for a Revolving Credit Borrowing, after the Agent's receipt of the
funds representing a Bank's Ratable Portion of such Revolving Credit Borrowing
and subject to the terms of this Agreement and the Borrower's fulfillment of the
conditions set forth in Section 0 of this Agreement, the Agent will make such
Revolving Credit Loan of such Bank available to the Borrower in immediately
available funds, by wire transfer or intrabank transfer: (A) to the Operating
Account or (B such other account of the Borrower as the Agent and the Borrower
shall have agreed upon from time to time in writing.
(a) DISBURSEMENT OF FUNDS RECEIVED. On the date requested by
the Borrower for a Revolving Credit Borrowing, after the Agent's
receipt of the funds representing a Bank's Ratable Portion of such
Revolving Credit Borrowing and subject to the terms and conditions set
forth in this Agreement, the Agent shall make such Revolving Credit
Advance of such Bank available to the Borrower, in immediately
available funds, by wire transfer or intrabank transfer to the
Operating Account.
2.4 AVAILABILITY OF FUNDS. Unless the Agent shall have received
notice from a Bank on a Business Day prior to the date (or, in the case of
Alternate Base Rate Loans, prior to the time) of any Revolving Credit Borrowing
that such Bank will not make available to the Agent such Bank's Ratable Portion
of the Revolving Credit Borrowing, the Agent may assume that such Bank has made
its Ratable Portion of the Revolving Credit Borrowing available to the Agent on
the date of the Revolving Credit Borrowing in accordance with Section 0 of this
Agreement. In reliance upon such assumption, the Agent may, but shall not be
obligated to, make available to the Borrower on such date, a portion of the
Revolving Credit Borrowing corresponding to such Bank's Ratable Portion. Any
disbursement by the Agent in reliance on such assumption shall be deemed to be
an advance of a Revolving Credit Loan by such Bank.
2.5 FAILURE OF BANK TO FUND. If and to the extent that any Bank
shall not have made available to the Agent such Bank's Ratable Portion of any
Revolving Credit Borrowing, such Bank and the Borrower severally agree to repay
to the Agent, immediately upon demand by the Agent, an amount equal to such
Bank's Ratable Portion of such Revolving Credit Borrowing, as the case may be,
together with interest thereon for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the Agent, at:
(a) in the case of the Bank, (i) Federal Funds Rate for the first three (3) days
from and after the date of the Revolving Credit Borrowing and (ii) thereafter,
at the Interest Rate then applicable to Alternate Base Rate Loans and (b) in the
case of the Borrower, the interest rate applicable at the time to Alternate Base
Rate Loans.
(a) PAYMENT CONSTITUTING RATABLE PORTION. If such Bank pays to
the Agent the Bank's Ratable Portion of such Revolving Credit Borrowing
prior to repayment of such amount by the Borrower, the amount so repaid
shall constitute such Bank's Ratable Portion of such Revolving Credit
Borrowing and the Borrower shall have no further obligation to make the
payment required by this Section.
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(b) TREATMENT OF DEFAULTING BANK. The Agent shall not be
obligated to transfer to a defaulting Bank any payments made by the
Borrower to the Agent for the benefit of such defaulting Bank if such
Bank has not made available to the Agent such Bank's Ratable Portion of
any Revolving Credit Borrowing advanced pursuant to this Agreement.
Until the earlier of such defaulting Bank's cure of such failure or the
termination of the Commitments, all amounts repaid to the Agent by the
Borrower which would otherwise be required to be applied to such Bank's
Ratable Portion of the Obligations shall be advanced to the Borrower by
the Agent on behalf such defaulting Bank to cure, in full or in part,
the failure by such Bank, but shall nevertheless be deemed to have been
paid to such defaulting Bank in satisfaction of the Obligations to
which such payment would otherwise have been applied. Notwithstanding
anything contained herein to the contrary, no such defaulting Bank
shall have any voting or consent rights under or with respect to the
Loan Documents or constitute a "Bank" (or be included in the
calculation of "Required Banks" hereunder) for any voting or consent
rights under or with respect to any Loan Document. The terms of this
Section 0 shall: (i) remain effective with respect to such defaulting
Bank until such time as the defaulting Bank shall no longer be in
default of any of its obligations under this Agreement and (ii) shall
not relieve or excuse the performance by the Borrower of any of its
duties or obligations hereunder.
(c) CONTINUING BORROWER OBLIGATION. Failure of any Bank to
fund its Ratable portion of any Borrowing shall not relieve or excuse
the performance by the Borrower of any of its duties or obligations
hereunder.
(d) CONTINUING BANK OBLIGATION TO FUND. It is understood that:
(i) a Bank shall not be responsible for any failure by any other Bank
to perform its obligation to make any Loans hereunder, (ii) the
Revolving Credit Commitment of a Bank shall not be increased or
decreased as a result of any failure by any other Bank to perform its
obligation to make any Loans hereunder, (iii) failure by any Bank to
perform its obligation to make any Loans hereunder shall not excuse any
other Bank from its obligation to make any Revolving Credit Loans
hereunder, and (iv) the obligations of each Bank hereunder shall be
several, not joint and several.
2.6 REPAYMENTS AND PREPAYMENTS; REDUCTION OF COMMITMENTS,
EXTENSION OF COMMITMENTS.
(a) REPAYMENT. The Borrower shall repay to the Agent, for the
account of the Banks, the outstanding principal amount of the Revolving
Credit Loans on the Revolving Credit Termination Date in accordance
with Section 0(a).
(b) MANDATORY PREPAYMENT OF REVOLVING CREDIT LOANS. If, on any
Business Day, (x) the sum of: (A) the aggregate Revolving Credit Loans
outstanding at
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such time plus (B) the aggregate LC Exposure of the Banks outstanding
at such time exceeds (y) the aggregate Revolving Credit Commitments of
all of the Banks then in effect, then the Borrower shall on such day
prepay to the Agent for the account of the Banks an aggregate principal
amount of such Revolving Credit Loans in an amount at least equal to
such excess plus any amounts required pursuant to the provisions of
Section 0 of this Agreement.
(c) MANDATORY REDUCTION OF REVOLVING CREDIT COMMITMENT. The
Borrower shall apply all Net Proceeds acquired in connection with
transactions permitted by this Agreement promptly upon receipt thereof
to prepay the Revolving Credit Loans outstanding at the time of such
receipt and to permanently reduce the Revolving Credit Commitments
(rounded down to the nearest One Hundred Thousand Dollars ($100,000)
amounts in excess of such rounded amount shall be applied to the
outstanding Revolving Credit Loans only): provided, however, that the
Borrower shall not be permitted at any time to reduce the Revolving
Credit Commitments to an amount less than the aggregate LC Exposure of
the Banks outstanding at such time. In the event that the reduction in
the Revolving Credit Commitments required by this Section 0 would cause
the remaining Revolving Credit Commitments to be less than the LC
Exposure of the Banks after giving effect to such reduction, the Agent
shall hold such excess fund in a non-interest bearing account until
such time that the requirements of the immediately preceding sentence
shall not be violated. Each reduction in the aggregate Revolving Credit
Commitments hereunder shall be made among the Banks ratably in
accordance with their Revolving Credit Commitments. On the date of each
reduction, the Borrower shall pay to the Agent for the account of the
Banks (x) the commitment fees and interest accrued through the date of
such reduction in respect of the aggregate Revolving Credit Commitments
and (y) any amounts required pursuant to the provisions of Section 0 of
this Agreement. Any reduction in the Revolving Credit Commitments shall
be a permanent reduction and no amount in excess of such reduced
commitment may be borrowed or reborrowed.
(d) VOLUNTARY REDUCTION OF REVOLVING CREDIT COMMITMENT. Upon
three (3) Business Days prior written notice to the Agent, the Borrower
may in accordance with the terms of this Agreement request that the
Banks permanently reduce, in whole or in part, the aggregate Revolving
Credit Commitment. Each reduction shall be subject to the following:
(i) each such reduction shall be in an aggregate principal amount of
not less than Five Million Dollars ($5,000,000) or any integral
multiple of One Million Dollars ($1,000,000) in excess thereof, (ii)
the Borrower shall not be permitted to reduce the aggregate Revolving
Credit Commitments unless, concurrently with any reduction, the
Borrower shall make a principal payment on each Bank's then outstanding
Revolving Credit Loans in an amount equal to the excess, if any, of (A)
the sum of such Revolving Credit Loans and aggregate LC Exposure over
(B) the Revolving Credit Commitment of such Bank as so reduced and
(iii) the Borrower shall not be permitted at any time to reduce the
Revolving Credit Commitments to an amount less than the aggregate LC
Exposure of the Banks outstanding at such time. Each reduction in the
aggregate
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Revolving Credit Commitments hereunder shall be made among the Banks
ratably in accordance with their Revolving Credit Commitments. On the
date of each reduction, the Borrower shall pay to the Agent for the
account of the Banks (x) the commitment fees and interest accrued
through the date of such reduction in respect of the aggregate
Revolving Credit Commitments and (y) any amounts required pursuant to
the provisions of Section 0 of this Agreement. Any reduction in the
Revolving Credit Commitments shall be a permanent reduction and no
amount in excess of such reduced commitment may be borrowed or
reborrowed.
(e) PERMITTED PREPAYMENTS. The Borrower may prepay all or any
part of Revolving Credit Loans by giving notice to the Agent for the
account of the Banks stating the proposed date of prepayment, the Type
of Borrowing being prepaid and the aggregate principal amount of the
prepayment not later than 12:00 noon (Cleveland, Ohio time) on the
Business Day immediately preceding the Business Day on which such
prepayment is to be made. Upon such notice, the Borrower shall: (A) in
respect of Alternate Base Rate Loans comprising part of the same
Revolving Credit Borrowing, prepay the outstanding aggregate principal
amount thereof in whole or ratably in part and (B) in respect of LIBOR
Rate Loans comprising part of the same Revolving Credit Borrowing,
prepay the outstanding aggregate principal amount thereof in whole and
the interest accrued to the date of such prepayment on the principal
amount of such Borrowing so prepaid; provided, however, that: (I) each
partial prepayment of Alternate Base Rate Loans shall be (x) in an
aggregate principal amount of One Hundred Thousand Dollars ($100,000)
or any multiple thereof or (y) in an amount equal to the aggregate
principal amount of Alternate Base Rate Loans then outstanding, (II)
each partial prepayment of LIBOR Rate Loans shall be (a) in an
aggregate principal amount not less than One Million Dollars
($1,000,000), or an integral multiple of One Hundred Thousand Dollars
($100,000) in excess thereof or (b) in an amount equal to the aggregate
principal amount of LIBOR Rate Loans then outstanding, and (III) any
prepayment of any LIBOR Rate Loans made on other than the last day of
an Interest Period shall obligate the Borrower to reimburse the Bank in
respect thereof pursuant to Section 0 of this Agreement.
(f) EXTENSION OF COMMITMENT PERIOD. During the thirty (30) day
period following delivery by the Borrower pursuant to Section 0 of this
Agreement of its consolidated financial statements for its Fiscal Year
ending December 31, 1998, and annually thereafter during the thirty
(30) day period following delivery by the Borrower of its consolidated
financial statements pursuant to Section 0, the Borrower may request
the Agent to determine if all of the Banks are then willing to extend
the Revolving Credit Termination Date for a single additional year. If
the Borrower so requests the Agent will advise the Banks. If all of the
Banks in their sole discretion are willing to extend the Revolving
Credit Termination Date, the Borrower, the Agent and the Banks shall
execute a definitive written amendment extending the Revolving Credit
Termination Date. No extension shall be effective for any purpose
unless such definitive written instrument is signed by all of the Banks
and delivered within sixty (60) days following the notice from
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the Agent to the Banks that the Borrower has requested such an
extension. No Bank shall be obligated to grant the Borrower any such
extension, and unanimous written consent of all the Banks shall be
required to extend the Revolving Credit Termination Date. In the event
of the failure of any of the Banks to so respond affirmatively or
negatively in writing within such sixty (60) day period, such request
for extension shall be deemed to have been denied.
2.7 RATE CONVERSION AND RATE CONTINUATION. The Borrower shall have
the right to convert or continue any Revolving Credit Borrowing as a LIBOR Rate
Borrowing or an Alternate Base Rate Borrowing, upon request delivered by the
Borrower to the Agent not later than 12:00 noon (Cleveland time): (a) on the
Business Day that Borrower desires to convert any LIBOR Rate Borrowing into an
Alternate Base Rate Borrowing, (b) three Business Days prior to the Business Day
on which the Borrower desires to convert any Alternate Base Rate Borrowing into
a LIBOR Rate Borrowing for a given Interest Period, (c) three Business Days
prior to the Business Day on which Borrower desires to continue any LIBOR Rate
Borrowing as a LIBOR Rate Borrowing for an additional Interest Period of the
same duration, and (d) three Business Days prior to the Business Day on which
Borrower desires to convert any LIBOR Rate Borrowing having a particular
Interest Period into a LIBOR Rate Borrowing having a different permissible
Interest Period; provided, however, that each such Rate Conversion or Rate
Continuation shall be subject to the following:
(i) each Rate Conversion or Rate Continuation shall be made
among the Banks based upon such Bank's Ratable Portion of such
converted or continued Revolving Credit Borrowing;
(ii) if less than all the outstanding principal amount of a
Revolving Credit Borrowing is converted or continued, the aggregate
principal amount of such Revolving Credit Borrowing converted or
continued shall be: (A) in the case of a LIBOR Rate Borrowing, not less
than One Million Dollars ($1,000,000), or an integral multiple of One
Hundred Thousand Dollars ($100,000) in excess thereof and (B) in the
case of an Alternate Base Rate Borrowing, One Hundred Thousand Dollars
($100,000);
(iii) each Rate Conversion or Rate Continuation shall be
effected as if each Bank were applying the proceeds of Loans resulting
from such Rate Conversion or Rate Continuation to Loans being converted
or continued, as the case may be, and the accrued interest on any such
Loans (or portion thereof) being converted or continued shall be paid
to the Agent on behalf of each Bank by the Borrower at the time of such
Rate Conversion or Rate Continuation;
(iv) LIBOR Rate Loans shall not be converted or continued at a
time other than the end of an Interest Period applicable thereto unless
the Borrower shall pay to the Agent for the benefit of the Banks, upon
demand, any amounts due to any of the Banks pursuant to Section 0.4 of
this Agreement;
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(v) a Revolving Credit Borrowing may not be converted into or
continued as a LIBOR Rate Borrowing if the Interest Period applicable
thereto will expire less than one month prior to the Revolving Credit
Termination Date;
(vi) after and during the continuance of a Potential Default,
and after the occurrence of an Event of Default which has not been
waived or otherwise consented to by the Required Banks, a Revolving
Credit Borrowing may not be converted or continued as a LIBOR Rate
Borrowing; and
(vii) any LIBOR Rate Borrowing that cannot be continued as a
LIBOR Rate Borrowing by reason of clause (iv), (v), (vi) or (vi) of
this definition shall be automatically converted at the end of the
Interest Period in effect for each LIBOR Rate Borrowing into an
Alternate Base Rate Borrowing.
Each such request for a conversion or continuation (a "Rate
Conversion/Continuation Request") in respect of a Revolving Credit Borrowing
shall be transmitted by the Borrower to the Agent by telecopier, telex or cable
(in the case of telex or cable, confirmed in writing prior to the effective date
of the Rate Conversion or Rate Continuation requested), in substantially the
form of Exhibit C hereto. The Rate Conversion/Continuation Request shall
specify: (A) the identity and amount of the Loans comprising a Revolving Credit
Borrowing that the Borrower requests be converted or continued, (B) the Type of
Loans into which such Loans are to be converted or continued, (C) if such notice
requests a Rate Conversion, the date of the Rate Conversion (which shall be a
Business Day) and (D) in the case of a Revolving Credit Borrowing converted into
or continued as a LIBOR Rate Borrowing, the Interest Period for such LIBOR Rate
Loans. The Borrower may make Rate Conversion/Continuation Requests
telephonically so long as written confirmation of such Revolving Credit
Borrowing is received by the Agent by 1:00 p.m. (Cleveland, Ohio time) on the
same day of such telephonic Rate Conversion/Continuation Request. The Agent may
rely on such telephonic Rate Conversion/Continuation Request to the same extent
that the Agent may rely on a written Rate Conversion/Continuation Request. Each
Rate Conversion/Continuation Request, whether telephonic or written, shall be
irrevocable and binding on the Borrower and subject the Borrower to the
indemnification provisions of Section 0 of this Agreement. The Borrower shall
bear all risks related to giving any Rate Conversion/Continuation Request
telephonically or by such other method of transmission as Borrower shall elect.
2.8 LETTERS OF CREDIT. Subject to the terms and conditions set
forth in this Agreement, the Letter of Credit Bank agrees, at any time and from
time to time, from and including the Closing Date but in no event after the
thirtieth calendar day immediately preceding the Revolving Credit Termination
Date, to issue and deliver, or to extend the expiration of, Letters of Credit
for the account of the Borrower; provided, however, that, the aggregate LC
Exposure of the Banks shall not at any time exceed the lesser of: (x) Ten
Million Dollars ($10,000,000) outstanding at any time and (y) the difference
between (I) the aggregate Revolving
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Credit Commitments of the Banks as then in effect and (II) the sum of (a) the
aggregate outstanding Revolving Credit Loans of the Banks at such time plus (b)
the aggregate LC Exposure of the Banks at such time.
(a) TERM; FORM AND CONDITIONS OF LETTERS OF CREDIT. Each
Letter of Credit shall be issued in such form as the Letter of Credit
Bank may reasonably require subject to the Uniform Customs and
Practices for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, and any subsequent revisions
thereof. Each Letter of Credit shall: (A) permit drawings upon
presentation of one or more sight drafts and such other documents as
specified by the Borrower in the Credit Request delivered pursuant to
Section 0 of this Agreement and agreed to by the Letter of Credit Bank,
which drawings shall occur on or prior to the applicable expiration
date of such Letter of Credit, (B) by its terms expire not later than
the earlier of one (1) year after the date of the Letter of Credit or
the third (3rd) Business Day prior to the Revolving Credit Termination
Date and (C) by its terms provided for payment of drawings in Dollars.
(b) REQUESTS FOR LETTERS OF CREDIT. Letters of Credit shall be
issued upon request given by the Borrower to the Agent not later than
12:00 noon (Cleveland, Ohio time) three (3) Business Days prior to the
specified date for the issuance of the requested Letter of Credit. Each
such request for a Letter of Credit shall be made in the form of a
Credit Request transmitted by the Borrower to the Agent by telecopier,
telex or cable (in the case of telex or cable, confirmed in writing
prior to the date of the requested issuance of the Letter of Credit),
specifying with respect to each Letter of Credit requested: (i) the
face amount thereof, (ii) the beneficiary, (iii) the intended date of
issuance, (iv) the terms of the Letter of Credit, and shall be promptly
forwarded by the Agent to the Letter of Credit Bank. Concurrently with
each Credit Request requesting a Letter of Credit, the Borrower shall
execute and deliver to the Letter of Credit Bank a Reimbursement
Agreement, in the Letter of Credit Bank's then standard form of
application for and reimbursement agreement with respect to letters of
credit (such documents being hereinafter collectively referred to as a
"Reimbursement Agreement"); provided, however, that in the event of any
conflict between the provisions of any such Reimbursement Agreement and
this Agreement, the provisions of this Agreement shall govern.
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(c) PARTICIPATION BY BANKS IN LETTERS OF CREDIT. By the
issuance of a Letter of Credit by the Letter of Credit Bank and without
further action on the part of the Letter of Credit Bank or any Bank,
the Letter of Credit Bank hereby grants to each Bank, and each Bank
hereby acquires from the Letter of Credit Bank, a participation in each
Letter of Credit equal to such Bank's Ratable Portion, effective on the
date of the issuance of each Letter of Credit. In consideration, each
Bank hereby absolutely and unconditionally agrees to pay to the Agent
for the account of such Letter of Credit Bank such Bank's Ratable
Portion of each disbursement made by such Letter of Credit Bank in
respect of such Letter of Credit and not reimbursed by the Borrower as
hereinafter provided or not reimbursed by reason of the illegality of
such reimbursement, or any reimbursement payment required to be
refunded to the Borrower for any reason. Each Bank acknowledges and
agrees that its obligation to acquire risk participations pursuant to
this Section 0 is absolute and unconditional and shall not be affected
by any event or circumstance whatsoever, including the occurrence of
any Potential Default or Event of Default hereunder or the failure of
any condition precedent set forth in Section 0 of this Agreement to be
satisfied and each payment in satisfaction thereof shall be made
without any offset, abatement, withholding or reduction whatsoever;
provided, however, that the foregoing shall not be construed to excuse
the Letter of Credit Bank from liability to any Bank to the extent of
any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by each of the Banks to the fullest
extent permitted by applicable Law) suffered by such Bank that are
caused by such Letter of Credit Bank's gross negligence or wilful
misconduct.
(d) REIMBURSEMENT; INTEREST. The Borrower agrees that whenever
there is a drawing on a Letter of Credit issued by the Letter of Credit
Bank, the Borrower shall pay to the Agent on the date of such drawing,
an amount equal to such drawing. The Agent shall promptly remit any
such payment to the Letter of Credit Bank. If there is a drawing on a
Letter of Credit, then, unless the Borrower shall reimburse such amount
in full on such date, the unpaid amount thereof shall bear interest for
the account of the Letter of Credit Bank for each day from and
including the date of such drawing, to but excluding the earlier of the
date of reimbursement or the date on which such drawing is reimbursed
by a Revolving Credit Borrowing, at the rate per annum that would apply
to such amount if such amount were an Alternate Base Rate Loan by a
Bank.
(e) FAILURE TO REIMBURSE. In the event that the Borrower fails
to make a timely reimbursement, together with any interest thereon, to
the Agent on the date of any drawing on a Letter of Credit pursuant to
this Section, such failure shall constitute a Deemed Credit Request
requesting an Alternate Base Rate Loan in an aggregate amount equal to
the amount reimbursable to the Letter of Credit Bank plus any interest
thereon. The Agent shall disburse all such loan proceeds directly to
the Letter of Credit Bank to satisfy the Borrower's aforesaid
reimbursement liability. The obligations of the Banks to the Agent
under this Section are in addition to and not in limitation of the
obligations of the Banks under Section 0 of this Agreement. In the
event that an Loan cannot be legally
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made pursuant to this Section 0 for any reason, each of the Banks shall
reimburse the Letter of Credit Bank in an amount equal to such Bank's
Ratable Portion of the drawing on the Letter of Credit.
(f) OBLIGATIONS ABSOLUTE. The obligation of the Borrower to
reimburse the Letter of Credit Bank shall, in each case, be absolute
and unconditional and shall be performed under all circumstances
including, without limitation: (i) any lack of validity or
enforceability of any Letter of Credit, (ii) the existence of any
claim, offset, defense or other right that the Borrower may have
against the beneficiary of any Letter of Credit or any successor in
interest thereto, (iii) the existence of any claim, offset, defense or
other right that any Bank or the Agent may have against the Borrower or
against the beneficiary of any Letter of Credit or against any
successor in interest thereto, (iv) the existence of any fraud or
misrepresentation in the presentment of any draft or other item drawn
and paid under any Letter of Credit by any person other than the Letter
of Credit Bank, (v) any payment of any draft or other item by the
Letter of Credit Bank which does not strictly comply with the terms of
any Letter of Credit issued by the Letter of Credit Bank, so long as,
in each case, such payment shall not have constituted gross negligence
or willful misconduct on the part of the Letter of Credit Bank, (vi)
any improper use which may be made of the Letter of Credit or any
improper acts or omissions of any beneficiary or transferee of the
Letter of Credit in connection therewith, (vii) any statement or any
other documents presented under any Letter of Credit proving to be
insufficient, forged, fraudulent or invalid in any respect or any
statement therein being untrue or inaccurate in any respect whatsoever,
(viii) the insolvency of any Person issuing any documents in connection
with the Letter of Credit, (ix) any irregularity in the transaction
with respect to which a Letter of Credit is issued, including any fraud
by the beneficiary or any transferee of such Letter of Credit, (x) any
errors, omissions, interruptions or delays in transmission or delivery
of any messages, (xi) any act, error, neglect or default, omission,
insolvency or failure of business of any of the correspondents of the
Letter of Credit Bank, or (xii) any other circumstances arising from
causes beyond the control of the Letter of Credit Bank.
(g) LIABILITY OF LETTER OF CREDIT BANK. It is expressly
understood and agreed that the absolute and unconditional obligation of
the Borrower hereunder to reimburse disbursements in respect of Letters
of Credit issued by a Letter of Credit Bank shall not be construed to
excuse a Letter of Credit Bank from liability to the Borrower to the
extent of any direct damages (as opposed to consequential damages,
claims in respect of which are hereby waived by the Borrower to the
extent permitted by applicable Law) suffered by the Borrower or any
Subsidiary of the foregoing that are caused by the gross negligence or
willful misconduct of the Letter of Credit Bank in determining whether
drafts and other documents presented under a Letter of Credit comply
with the terms thereof. The parties agree that the Letter of Credit
Bank may accept documents that appear on their face to be in order,
without responsibility for further investigation, regardless of any
notice or information to the contrary, and may make payment upon
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presentation of documents that appear on their face to be in
substantial compliance with the terms of such Letter of Credit;
provided, however, that the Letter of Credit Bank shall have the right
in its sole discretion to decline to accept such documents and to
decline to make such payment if such documents are not in strict
compliance with the terms of such Letter of Credit. In making any
payment under any Letter of Credit, the Letter of Credit Bank's (i)
exclusive reliance on the documents, appearing on their face to be in
order, as well as signatures and endorsements presented to it under
such Letter of Credit, in each case as to any and all matters set forth
therein, including reliance on the amount of any draft presented under
such Letter of Credit, whether the amount due to the beneficiary
thereunder equals the amount of such draft, any document presented
pursuant to such Letter of Credit proves to be in order, or any other
statement or any other document or any signature or endorsement with
respect thereto presented pursuant to such Letter of Credit proves to
be forged or invalid or any statement therein proves to be inaccurate
or untrue in any respect whatsoever, and (ii) making payment upon
presentation of documents not complying in any immaterial respect with
the terms of the Letter of Credit shall, in each case, not be deemed to
constitute willful misconduct or gross negligence of the Letter of
Credit Bank. Any action, inaction or omission on the part of the Letter
of Credit Bank or any of its correspondents, under or in connection
with any Letter of Credit issued by the Letter of Credit Bank or any
renewal or extension thereof or the related instruments or documents,
if taken in good faith and in conformity with applicable Laws and
regulations governing Letters of Credit generally and the terms of this
Section 0, shall be binding upon the Borrower and shall not place the
Letter of Credit Bank or any of its correspondents under any liability
to the Borrower. The Letter of Credit Bank's rights, powers, privileges
and immunities specified in or arising under this Agreement are in
addition to any heretofore or at any time hereafter otherwise created
or arising rights, powers, privileges and immunities, whether by
statute or rule of Law or contract.
(h) LETTER OF CREDIT BANK INDEMNITY. The Borrower shall
indemnify the Letter of Credit Bank from and against: (i) any loss or
liability (other than any caused by such Letter of Credit Bank's gross
negligence or willful misconduct as determined by the final judgment of
a court of competent jurisdiction) incurred by the Letter of Credit
Bank in respect of this Agreement and the Letters of Credit and (ii)
any out-of-pocket expenses incurred by the Letter of Credit Bank in
defending itself or otherwise related to this Agreement or any Letter
of Credit (other than any caused by the Letter of Credit Bank's gross
negligence or willful misconduct as determined by the final judgment of
a court of competent jurisdiction) including, without limitation,
reasonable fees and expenses of legal counsel incurred by such Letter
of Credit Bank (including, without limitation, the reasonable
interdepartmental charges of its salaried attorneys) in the defense of
any claim against it or in the prosecution of its rights and remedies.
(i) EFFECT OF APPLICABLE LAW OR CUSTOM. All Letters of Credit
issued hereunder, all reimbursement obligations hereunder and all
reimbursement obligations under any Reimbursement Agreement will,
except to the extent otherwise expressly
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provided in this Agreement, the Reimbursement Agreements or the Letters
of Credit, be governed by the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, and any subsequent revisions thereof.
(j) TERMINATION OF LETTER OF CREDIT COMMITMENT. In the event
that: (i) any restriction is imposed on the Letter of Credit Bank
(including, without limitation, any legal lending or acceptance limits
imposed by the United States of America or any political subdivision
thereof or of any foreign government or central bank) which in the
judgment of the Letter of Credit Bank would prevent the Letter of
Credit Bank from issuing Letters of Credit or maintaining its
commitment to issue Letters of Credit or (ii) there shall have
occurred, at any time during the term of this Agreement: (A) any
outbreak of hostilities or other national or international crisis or
change in economic conditions if the effect of such outbreak, crisis or
change would make the creation of Letters of Credit impracticable, (B)
the enactment, publication, decree or other promulgation of any
statute, regulation, rule or order of any court or other governmental
authority which would materially and adversely affect the ability of
the Borrower to perform its obligations under this Agreement, or (C)
the taking of any action by any government or agency in respect of its
monetary or fiscal affairs which would have a material adverse effect
on the issuance of Letters of Credit, then the Letter of Credit Bank,
in the case of the occurrence of any event described hereinabove, shall
give written notice of the occurrence of such event to the Borrower and
the Agent whereupon the commitment of the Letter of Credit Bank to
issue Letters of Credit shall be suspended on the effective date of
such notice and shall continue suspended until the effect of such event
shall cease to exist.
2.9 FEES. The Borrower shall pay to the Agent for its own
account, or for the account of the Letter of Credit Bank or the Banks, as the
case may be, the fees set forth in this Section 0. All fees set forth in this
Section 0 shall be paid on the date due, in immediately available funds, to the
Agent for distribution as appropriate to itself, the Letter of Credit Bank, and
the Banks and once paid, none of such fees shall be refundable under any
circumstances.
(a) REVOLVING CREDIT COMMITMENT FEE. The Borrower agrees to
pay to the Agent for the benefit of the Banks, allocable to the Banks
in accordance with the Ratable Portion of the Banks, a commitment fee
equal to: (x) the Applicable Commitment Fee Percentage then in effect
multiplied by (y) the average daily unused portion of the total of the
Revolving Credit Commitments of the Banks outstanding on the Fee
Percentage Determination Date immediately preceding the applicable Fee
Percentage Adjustment Date. The annual fee shall be payable quarterly
in arrears on the first day of each Fiscal Quarter commencing April 1,
1998, until the Revolving Credit Termination Date.
(b) ARRANGEMENT AND STRUCTURING. The Borrower agrees to pay to
the Agent on the Closing Date for its sole account a one time fee for
arranging and structuring the
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financing transaction contemplated by this Agreement in the amount
specified in the commitment letter executed by the Borrower and the
Agent, dated December 9, 1997.
(c) ANNUAL AGENT'S FEE. The Borrower agrees to pay to the
Agent for its sole account an annual agent fee as set forth in the
Agent's Fee Letter.
(d) LETTER OF CREDIT FEES. The Borrower agrees to pay fees in
respect of Letters of Credit issued for the account of the Borrower as
follows:
(i) ANNUAL LETTER OF CREDIT RISK PARTICIPATION FEE.
The Borrower agrees to pay to the Agent for the benefit of the
Banks, allocable to the Banks in accordance with the Ratable
Portion of the Banks, in advance on the date of issuance of
each Standby Letter of Credit issued for its account and on
any renewal or extension date thereafter, an annual risk
participation fee (adjusted for Standby Letters of Credit
having terms less than one year) equal to: (x) the Applicable
Risk Participation Fee then in effect multiplied by (y) the
face amount of the Standby Letter of Credit issued by the
Letter of Credit Bank.
(ii) ANNUAL LETTER OF CREDIT BANK FEE. Commencing on
April 1, 1998, the Borrower agrees to pay to the Agent for the
sole benefit of the Letter of Credit Bank, payable quarterly
in arrears, an issuance fee equal to: (x) one-eighth of one
percent (1/8%) multiplied by (y) the average daily face amount
of each Standby Letter of Credit outstanding during the
immediately preceding quarter.
(iii) OTHER FEES RELATING TO LETTERS OF CREDIT. The
Borrower agrees to pay to the Agent for the sole benefit of
the Letter of Credit Bank upon issuance of any Letters of
Credit issued for its account any standard fees, amendment and
modification fees and any other standard fees and charges
customarily charged by the Letter of Credit Bank in connection
with Standby Letters of Credit.
(e) LATE CHARGES. If the Borrower fails to pay any amount due
under this Agreement, or any fee in connection herewith, in full within
ten (10) days after its due date, the Agent shall be entitled to, in
addition to its remedies under Section 0 hereof, and the Borrower will
incur and shall pay to the Agent for the benefit of the Banks, in each
such case, a late charge equal to one percent (1%) of the amount failed
to be paid. The payment of a late charge will not cure or constitute a
waiver of any Potential Default or Event of Default under this
Agreement.
(f) APPLICABLE RISK PARTICIPATION PERCENTAGE AND APPLICABLE
FACILITY FEE PERCENTAGE. The Applicable Risk Participation Percentage
or Applicable Commitment Fee Percentage, as the case may be, shall be
calculated as herein specified as of the Closing Date and as of the
first day of the calendar quarter (each an "Fee Adjustment Date")
commencing after the date the Agent shall have received (A) financial
statements
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required by Sections 0, 0 or 0, as the case may be, for the period
ending as of the last day of the Fiscal Quarter or Fiscal Year
immediately preceding such Fee Adjustment Date (each a "Fee
Determination Date") and (B) a certificate complying with Section 0
certifying the Borrower's Consolidated Total Funded Debt to EBITDA
Ratio as of any such Fee Determination Date. On each Fee Adjustment
Date, the Applicable Risk Participation Percentage or Applicable
Commitment Fee Percentage, as the case may be, shall be the percentage
set forth in the definition of "Applicable Risk Participation
Percentage" and "Applicable Facility Fee Percentage" which corresponds
to the Borrower's Consolidated Total Funded Debt to EBITDA Ratio as of
the Fee Determination Date applicable to such Fee Adjustment Date. The
Applicable Risk Participation Percentage and Applicable Commitment Fee
Percentage effective as of a particular Fee Adjustment Date shall
remain effective only until the next succeeding Fee Adjustment Date at
which time the Applicable Risk Participation Percentage and Applicable
Commitment Fee Margin shall be recalculated pursuant to this Section 0;
except, however, that, if an Event of Default shall have occurred which
has not been waived in writing by all of the Banks, or if the Borrower
shall not have delivered as of such Margin Adjustment Date the
financial statements in accordance with Sections 0, 0 and 0 of this
Agreement, the Applicable Risk Participation Fee Percentage shall be
eight-tenths of one percent (.80%) per annum and the Applicable
Commitment Fee Percentage shall be three-tenths of one percent (.30%)
per annum.
(g) PAYMENT OF FEES; NONREFUNDABLE. All fees set forth in this
Section 0 shall be paid on the date due, in immediately available
funds, to the Agent for distribution, if and as appropriate, to the
Banks or the Letter of Credit Bank. Once paid, to the extent permitted
by applicable Law, none of such fees shall be refundable under any
circumstances.
2.10 INTEREST ON REVOLVING CREDIT LOANS.
(a) INTEREST RATE. The Borrower shall pay interest on the
unpaid principal amount of each Revolving Credit Loan made by each Bank
from the date of such Revolving Credit Loan until such principal amount
shall be paid in full as follows:
(i) ALTERNATE BASE RATE LOANS. During such periods as
any Alternate Base Rate Loan comprising a Revolving Credit
Borrowing is outstanding, the Borrower shall pay interest on
such Alternate Base Rate Loan at a rate per annum equal at all
times to the sum of the Alternate Base Rate, payable
quarterly, in arrears, on the first day of each calendar
quarter and on the date such Alternate Base Rate Loan
comprising a Revolving Credit Borrowing shall be converted or
paid in full (whether at maturity, by reason of acceleration
or otherwise) and, after maturity, on demand.
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(ii) LIBOR RATE LOANS. During such periods as any
LIBOR Rate Loan comprising a Revolving Credit Borrowing is
outstanding, the Borrower shall pay interest on such LIBOR
Rate Loan at a rate per annum equal to the sum of the London
Interbank Offered Rate plus the Applicable LIBOR Margin in
effect as of the most recently preceding Margin Adjustment
Date occurring prior to the date of the making of such LIBOR
Rate Loan, or the conversion or continuation of such LIBOR
Rate Loan in accordance with Section 0, payable: (A) on the
last day of each Interest Period and (B) if such Interest
Period has a duration of more than three months, three months
after the first day of such Interest Period and (C) on the
date such LIBOR Rate Loan comprising a Revolving Credit
Borrowing shall be converted to an Alternate Base Rate Loan or
paid in full (whether at maturity, by reason of acceleration
or otherwise) and (D) after maturity, on demand.
(b) APPLICABLE LIBOR MARGIN; TERMS OF ADJUSTMENT.
(i) COMMENCEMENT; CONDITIONS. So long as no Event of
Default shall have occurred which has not been waived in
writing by all of the Banks, the Applicable LIBOR Margin shall
be calculated as herein specified as of the Closing Date and
effective as of the first day of the Fiscal Quarter (each an
"Margin Adjustment Date") during which the Agent shall have
received (A) financial statements required by Sections 0, 0 or
0, as the case may be, for the period ending as of the last
day of the Fiscal Quarter or Fiscal Year immediately preceding
such Margin Adjustment Date (each a "Determination Date") and
(B) a certificate complying with Section 0 certifying the
Borrower's Consolidated Funded Debt to EBITDA Ratio as of any
such Determination Date.
(ii) CALCULATION AND DURATION OF ADJUSTMENT. On each
Margin Adjustment Date, the Applicable LIBOR Margin shall be
the Applicable LIBOR Margin set forth in the definition of
"Applicable LIBOR Margin" which corresponds to the Borrower's
Consolidated Total Funded Debt to EBITDA Ratio as of the
Determination Date applicable to such Margin Adjustment Date.
The Applicable LIBOR Margin effective as of a particular
Margin Adjustment Date shall remain effective only until the
next succeeding Margin Adjustment Date at which time the
Applicable LIBOR Margin shall be recalculated pursuant to this
Subsection (b); provided, however, that: (I) if at any time an
Event of Default shall have occurred that has not been waived
in writing by all of the Banks, or if the Borrower shall not
have delivered as of any Margin Adjustment Date the financial
statements required to have been delivered under Sections 0
and 0 of this Agreement, then, at the election of the Required
Banks, the Applicable LIBOR shall immediately adjust to be
eight-tenths of one percent (0.80%) per annum and (II) if an
Event of Default shall have occurred which has not been waived
in writing by the Required Banks, the interest rate shall,
upon the request
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of the Required Banks, be the interest rate applicable
pursuant to Section 0 of this Agreement.
(c) DEFAULT INTEREST. Following the occurrence of an Event of
Default which has not been waived in writing by all of the Banks, (i)
the principal thereof and the unpaid interest and fees thereon shall,
upon the request of the Required Banks, bear interest, payable on
demand, for Alternate Base Rate Loans and LIBOR Rate Loans, at a rate
per annum which shall be equal at all times to two percent (2.0%) in
excess of the Alternate Base Rate and (ii) the Applicable Risk
Participation Fee shall be two percent (2%) per annum.
(d) INTEREST RATE DETERMINATION.
(i) AGENT DETERMINATION; NOTICE. The Agent shall
determine the London Interbank Offered Rate in accordance
with the definition of London Interbank Offered Rate set forth
in Section 0 of this Agreement. The Agent shall give prompt
notice to each of the Banks and the Borrower of the applicable
interest rate determined by the Agent for purposes of Sections
0 and 0 of this Agreement.
(ii) FAILURE OF BORROWER TO ELECT. If no Interest Period
is specified in any Credit Request or any Rate
Conversion/Continuation Request for any LIBOR Rate Loans, the
Borrower shall be deemed to have selected an Interest Period
with a duration of one month. If the Borrower shall not have
given notice in accordance with Section 0 of this Agreement to
continue any LIBOR Rate Loans into a subsequent Interest
Period (and shall not have otherwise delivered a Rate
Conversion/Continuation Request in accordance with Section 0
of this Agreement to convert such Loans), such LIBOR Rate
Loans shall, at the end of the Interest Period applicable
thereto (unless repaid pursuant to the terms hereof),
automatically convert into Alternate Base Rate Loans.
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2.11 PAYMENTS AND COMPUTATIONS.
(a) PAYMENTS; APPLICATION OF PAYMENTS. Except to the extent
otherwise provided herein, all payments of Obligations shall be made in
Dollars, in immediately available funds, without setoff, counterclaim,
defense or deduction of any kind, to the Agent not later than 12:00
noon (Cleveland, Ohio time) on the day on which such payment shall
become due by deposit of such funds to the Agent's account maintained
at the Payment Office of the Agent. Payments received after 12:00 noon
(Cleveland, Ohio time) shall be deemed to have been received on the
next succeeding Business Day. The Borrower shall at the time of making
a payment hereunder specify to the Agent the Obligations to which such
payment is to be applied. If the Borrower does not specify an
application or if an Event of Default has occurred which has not been
waived in writing by the Required Banks, the Agent may, subject to
Section 0 of this Agreement, distribute a payment to the Letter of
Credit Bank or the Banks for application to such Obligations as the
Agent, in its sole discretion, elects or as the Required Banks shall
have directed; provided, however, the Agent will use reasonable efforts
to avoid an application of a payment which causes early prepayment of a
LIBOR Rate Borrowing prior to expiration of its applicable Interest
Period. Each payment received by the Agent for the account of the
Letter of Credit Bank or a Bank shall be paid on the day of such
receipt, in immediately available funds, to the Letter of Credit Bank
or Bank for the account of its respective Lending Office.
(b) PAYMENT PROCEDURES. The Control Account of the Borrower
will be charged with all Advances made by the Banks to the Borrower and
all other Obligations of the Borrower under this Agreement or any other
Loan Document. The Borrower hereby authorizes each Bank to charge the
Loan Account of the Borrower with such Obligations. The Control Account
of the Borrower will be credited in accordance with this Section 0 with
all payments received by the Agent directly from such Borrower or for
the account of the Borrower. The Agent shall send the Borrower
statements in accordance with the Bank's standard procedures. Absent
manifest error, each such statement shall be final, conclusive and
binding on the Borrower. The Loan Accounts of each Bank shall reflect
the activity in the Control Account applicable to such Bank's Loan
Account.
(c) AUTHORIZATION TO CHARGE ACCOUNT. If and to the extent
payment owed to the Agent or any Bank is not made when due hereunder or
under the Revolving Credit Notes, the Borrower hereby authorizes the
Agent and each Bank to charge from time to time against any or all of
the Borrower's accounts with the Agent or such Bank, as the case may
be, any amount so due. Notice of any such charge shall be given
promptly to the Borrower by the Agent or such Bank, as the case may be.
(d) COMPUTATIONS OF INTEREST AND FEES. All computations of
interest on LIBOR Rate Loans, as well as fees and other compensation
hereunder, shall be made by
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the Agent on the basis of a year of 360 days and for the actual number
of days (including the first day but excluding the last day) occurring
in the period for which such interest or fees are payable. All
computations of interest on Alternate Base Rate Loans shall be made by
the Agent on the basis of a year of 365 or 366 days and in each case
for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest or fees
are payable. Each determination by the Agent of interest, fees or other
amounts of compensation due hereunder shall be, absent manifest error,
prima facie evidence thereof.
(e) PAYMENT NOT ON BUSINESS DAY. Whenever any payment
hereunder or under the Revolving Credit Notes shall be stated to be due
on a day other than a Business Day, such payment shall be made on the
next succeeding Business Day. Any such extension of time shall in such
case be included in the computation of payment of interest, fees or
other compensation, as the case may be.
(f) PRESUMPTION OF PAYMENT IN FULL BY BORROWER. Unless the
Agent shall have received notice from the Borrower prior to the date on
which any payment is due to the Banks hereunder that the Borrower will
not make such payment in full, the Agent may assume that the Borrower
has made such payment in full to the Agent on such date. In reliance
upon such assumption, the Agent may, but shall not be obligated to,
distribute to each Bank on such due date the amount then due such Bank.
If and to the extent the Borrower shall not have made such payment in
full to the Agent, each Bank shall repay to the Agent promptly upon
demand the amount distributed to such Bank together with interest
thereon, for each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the Agent, at the
Federal Funds Rate for the first three (3) days from and after such
date and thereafter at the Interest Rate then applicable to Alternate
Base Rate Loans.
2.12 CHANGE IN LAW; LIBOR RATE LOANS UNLAWFUL. Notwithstanding any
other provision of this Agreement, if any Bank determines that any applicable
Law, or any change therein, or any change in the interpretation or
administration of any Law by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by such Bank (or its Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency, shall make it unlawful or impossible, or any such
governmental authority, central bank or agency asserts that it is unlawful, for
any Bank or its Lending Office to perform its obligations hereunder to make
LIBOR Rate Loans or to fund or maintain LIBOR Rate Loans hereunder, then, upon
notice to the Agent and the Borrower by such Bank: (a) the obligation of all of
the Banks to make, or to convert Loans into, LIBOR Rate Loans shall be suspended
until the Agent shall notify the Borrower and the Banks that the circumstances
causing such suspension no longer exist and (b) the Borrower shall immediately,
or at such later date, if any, as may thereafter be permitted by relevant Law,
prepay in full the then outstanding principal amount of all LIBOR Rate Loans of
all Banks, together with interest accrued thereon and any other amounts
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payable to the Banks hereunder unless the Borrower, upon notice from the Agent,
converts all LIBOR Rate Loans of all Banks then outstanding into Loans of
another Type in accordance with Section 0 of this Agreement as to which such
circumstances do not exist. Any such payment or Rate Conversion shall be subject
to the provisions of Section 0 of this Agreement.
2.13 UNAVAILABILITY. Notwithstanding any other provision in this
Agreement, if at any time with respect to any LIBOR Rate Loans:
(a) INADEQUATE RATE. Any Bank notifies the Agent that the
London Interbank Offered Rate for any Interest Period for such LIBOR
Rate Loans will not adequately reflect the cost to such Bank of making,
funding or maintaining its LIBOR Rate Loans for such Interest Period,
the Agent shall promptly notify the Borrower and the Banks;
(b) UNAVAILABLE QUOTATIONS. The Agent determines (which
determination shall be conclusive) that quotations of interest rates
for Dollar deposits are not being provided in the relevant amounts or
for the relevant maturities to, or the circumstances affecting the
London interbank market of deposits in Dollars make it impracticable
to, determine the London Interbank Offered Rate, or
(c) UNAVAILABLE DEPOSITS. Any Bank determines that Dollar
deposits of the relevant amount for the relevant Interest Period are
not available in the London interbank market of deposits of Dollars for
the purpose of funding the LIBOR Rate Loans,
then: (i) each LIBOR Rate Loan will automatically, on the last day of the then
existing Interest Period therefor, convert into an Alternate Base Rate Loan and
(ii) the obligation of the Banks to make or to convert Loans into LIBOR Rate
Loans or continue LIBOR Rate Loans shall be suspended until the Agent shall
notify the Borrower and the Banks that the circumstances causing such suspension
no longer exist.
2.14 PRO RATA TREATMENT. Except as set forth in Sections 0, 0 and 0
of this Agreement, each Borrowing, each payment or prepayment of principal of
any Borrowing, each payment of interest on the Loans, each payment of the fees
provided for hereunder, each Rate Conversion or Rate Continuation of Loans
comprising a Borrowing shall be allocated among the Banks in accordance with
each Bank's Ratable Portion (or if the Commitments shall have expired or been
terminated, in accordance with the respective principal amounts of each Bank's
Loans).
3 CONDITIONS OF LENDING.
3.1 CONDITIONS PRECEDENT TO INITIAL LOANS. The effectiveness of
this Agreement, the obligation of each Bank to make a Revolving Credit Loan on
the occasion of each Revolving Credit Borrowing and each Rate Conversion or Rate
Continuation, and the obligation of the Letter of Credit Bank to issue any
Letter of Credit are subject to the condition precedent that the Agent shall
have received on or before the Closing Date the following:
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(a) THIS AGREEMENT. Counterparts of this Agreement executed
and delivered by or on behalf of each of the parties hereto.
(b) SUBSIDIARY GUARANTIES. Subsidiary Guaranties appropriately
completed and executed by each of the Domestic Subsidiaries.
(c) CORPORATE ACTION; INCUMBENCY. A certificate executed by an
authorized officer of the Borrower certifying: (i) the resolutions of
the Board of Directors of the Borrower authorizing the execution,
performance and delivery of (A) this Agreement, (B) the Revolving
Credit Notes, (C) all Loan Documents to which the Borrower is a party
and (D) each other document executed in connection therewith or in
connection with any of the transactions contemplated herein or therein,
(ii) as true and correct the Articles of Incorporation and By-Laws of
the Borrower, (iii) the names and signatures of the officers of the
Borrower executing or attesting to such documents, (iv) compliance by
the Borrower with all representations, warranties, covenants and
conditions under this Agreement and each of the documents executed in
connection herewith, (v) the absence of any Potential Default or Event
of Default and (vi) the absence of any material litigation with respect
to this Agreement and the transactions contemplated thereby. The Agent
and each Bank may conclusively rely on such certificates until receipt
of notice in writing from the Borrower to the contrary.
(d) DOMESTIC SUBSIDIARY - CORPORATE ACTION; INCUMBENCY. A
certificate executed by an authorized officer of each Domestic
Subsidiary certifying: (i) the resolutions of the Board of Directors of
such Subsidiary authorizing the execution, performance and delivery of
(A) its respective Subsidiary Guaranty and (B) each other document
executed in connection therewith or in connection with any of the
transactions contemplated herein or therein, (ii) as true and correct
the Articles or Certificate of Incorporation and By-Laws or Regulations
of such Subsidiary, (iii) the names and signatures of the officers of
such Subsidiary executing or attesting to such documents, (iv)
compliance by such Subsidiary with all representations, warranties,
covenants and conditions under its respective the Subsidiary Guaranty
and each of the documents executed in connection herewith, (v) the
absence of any Potential Default or Event of Default and (vi) the
absence of any material litigation with respect to its Subsidiary
Guaranty Agreement and the transactions contemplated thereby. The Agent
and each Bank may conclusively rely on such certificates until receipt
of notice in writing from the Borrower to the contrary.
(e) GOOD STANDING - BORROWER. A certificate, as of a recent
date, from the Secretary of State of Delaware as to the good standing
of the Borrower in such jurisdiction.
(f) GOOD STANDING - DOMESTIC SUBSIDIARIES. Certificates, as of
a recent date,
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from appropriate governmental authorities for the jurisdiction of
incorporation with respect to each Domestic Subsidiary as to the good
standing of such Domestic Subsidiary in such jurisdiction.
(g) REVOLVING CREDIT NOTES. The Revolving Credit Notes, in
favor of each of the Banks, in the principal amount of such Bank's
Revolving Credit Commitment, each duly executed by the Borrower.
(h) LEGAL OPINIONS. An opinion of Squire, Xxxxxxx & Xxxxxxx,
counsel to the Borrower, in form and substance satisfactory to the
Agent, the Banks and their counsel, (i) with respect to the Borrower,
relating to corporate authority under Delaware law, the enforceability
of this Agreement and the Loan Documents under Ohio law and other
matters customarily addressed in opinions rendered in transactions of
this type and (ii) with respect to the Domestic Subsidiaries, relating
to corporate authority in the jurisdiction in which each such Domestic
Subsidiary is organized, the enforceability of the Subsidiary Guaranty
of each Domestic Subsidiary against such Domestic Subsidiary, and such
other matters customarily addressed in opinions rendered in
transactions of this type.
(i) MINIMUM AVAILABILITY. After the disbursement of the Loan
proceeds necessary to repay the Existing Lenders and to consummate the
Acquisitions, the Borrower shall have the ability to borrow at least
Twenty Million Dollars ($20,000,000) in Revolving Credit Loans.
(j) ASSIGNMENT AGREEMENT. The parties hereto and the parties
to the Existing Credit Agreement shall have executed and delivered an
assignment and acceptance agreement in form and substance satisfactory
to the Agent.
(k) CONSENTS. Evidence satisfactory to the Agent that the
Borrower has obtained, as certified by an officer of the Borrower, all
documents and instruments, including all consents, authorizations,
novations and filings required under law or under any material
contractual obligations of the Borrower as may be necessary for
consummation of the transactions contemplated by this Agreement and the
Loan Documents.
(l) DELIVERY OF FINANCIAL STATEMENTS; OFFICER'S CERTIFICATE.
(i) Company prepared financial statements of the Borrower as of
September 30, 1997, and the audited financial statements of the
Borrower as of December 31, 1996, each in form and substance
satisfactory to the Agent and the Banks and (ii) a certificate of the
chief financial officer of the Borrower, in his or her capacity as
chief financial officer, setting forth the calculations necessary to
determine which of the financial standards specified in definitions of
"Applicable LIBOR Margin" and "Applicable Risk Participation
Percentage" and "Applicable Commitment Fee Percentage" have been
satisfied by the Borrower.
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(m) CREDIT REQUEST AND DISBURSEMENT DIRECTION LETTER. A Credit
Request and a letter from the Borrower directing the Agent to disburse
the proceeds of the Loans.
(n) PAYMENT OF FEES. Evidence of the payment (or disbursement
direction for such payment delivered pursuant to Section 0 of this
Agreement): (i) to the Agent for its own account, the structuring and
arrangement fee and facility fee payable to the Agent and (ii) the
legal fees and out-of-pocket expenses of legal counsel to the Agent
through the time of Closing.
(o) PROJECTIONS. Acceptance by the Agent and the Banks of
projections for Fiscal Year 1998 and each of the next succeeding two
Fiscal Years of the Borrower.
(p) INSURANCE. Evidence satisfactory to the Agent and the
Banks, together with insurance certificates, that the Borrower has
adequate personal and real property, liability, business interruption
and product liability insurance.
(q) OTHER INFORMATION. Such other information, financial or
otherwise, as the Agent, any Bank or respective counsel thereto may
request, in its reasonable discretion.
3.2 CONDITIONS PRECEDENT TO ALL LOANS. The obligation of each
Bank to make a Revolving Credit Loan on the occasion of each Revolving Credit
Borrowing, Rate Conversion and Rate Continuation, and the obligation of the
Letter of Credit Bank to issue any Letter of Credit, are subject to the
condition precedent that, as of the date of any such Loan or issuance, and
before and after giving effect thereto:
(a) REPRESENTATION BRINGDOWN. The representations and
warranties contained in Sections 0 of this Agreement are true and
correct in all material respects on and as of the date of such Credit
Event with the same effect as though made on and as of such date,
except to the extent such representations and warranties expressly
relate to an earlier date; and
(b) NO DEFAULT; COMPLIANCE WITH TERMS. The Borrower shall be
in compliance with all other terms and provisions set forth herein and
in each other Loan Documents on its part to be observed or performed,
and at the time of and immediately after such Credit Event, No
Potential Default or Event of Default shall have occurred which has not
been waived by the Required Lenders; and
(c) NO MATERIAL ADVERSE EFFECT. There has been no event and
there exists no condition which would or which might reasonably be
expected to have a Material Adverse Effect, as determined by the
Required Banks.
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Each Credit Event and each receipt by the Borrower of the proceeds of any Loan
shall constitute a representation and warranty by the Borrower that on the date
of such Credit Event or receipt, as the case may be, the foregoing statements
are true and correct as of such date.
4 GENERAL REPRESENTATIONS AND WARRANTIES.
So long as the Obligations shall remain outstanding, the Banks shall
have any Revolving Credit Commitment and LC Exposure hereunder, and the Letter
of Credit Bank shall have any LC Commitment hereunder, the Borrower represents
and warrants to the Agent and each of the Banks as follows:
4.1 EXISTENCE. The Borrower and each of its subsidiaries is (a)
a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation and (b) has all requisite
corporate power and authority , and has all governmental licenses,
authorizations, consents and approvals necessary to own its assets and carry on
its business as now being conducted. The Borrower has no Subsidiaries other
than as listed in the Supplemental Schedule. The Borrower and each of its
Domestic Subsidiaries is duly qualified or licensed to transact business in each
jurisdiction where such qualification or licensure is necessary and a failure to
so qualify or be licensed will have a Material Adverse Effect.
4.2 AUTHORIZATION. The execution, delivery, and performance of
this Agreement, the Loan Documents to which the Borrower or any Domestic
Subsidiary is a party: (a) are within Borrower's or such Domestic Subsidiary's
corporate powers, (b) have been duly authorized by all necessary corporate
action, (c) are not in contravention of Law or the terms of Borrower's or such
Domestic Subsidiary's Certificate of Incorporation or By-Laws or of any
indenture or other document or instrument evidencing Indebtedness for borrowed
money or any other material agreement or undertaking to which the Borrower or
such Domestic Subsidiary is a party or by which it or its property is bound and
(d) do not required any waivers, consents or approvals by any of the creditors
(including, without limitation, the Note Holders) or trustees for creditors of
the Borrower or such Domestic Subsidiary or any other Person. The execution,
delivery, and performance of the Acquisition Documents, upon the consummation of
the Acquisitions: (a) are within Borrower's corporate powers, (b) have been duly
authorized by all necessary corporate action, (c) are not in contravention of
Law or the terms of Borrower's Certificate of Incorporation or By-Laws or of any
indenture or other document or instrument evidencing Indebtedness for borrowed
money or any other material agreement or undertaking to which the Borrower is a
party or by which it or its property is bound and (d) do not required any
waivers, consents or approvals by any of the creditors (including, without
limitation, the Note Holders) or trustees for creditors of the Borrower or any
other Person.
4.3 ENFORCEABILITY. This Agreement and the Loan Documents
constitute, the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with the terms thereof subject to
any applicable bankruptcy, insolvency, reorganization,
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moratorium or similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law). Upon consummation of the Acquisitions, the
Acquisition Documents will constitute, the legal, valid and binding obligations
of the Borrower, enforceable against the Borrower in accordance with the terms
thereof subject to any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles (whether enforcement is sought by
proceedings in equity or at law).
4.4 LITIGATION; PROCEEDINGS. Except as disclosed in the
Supplemental Schedule, there is no action, suit, investigation or proceeding,
and no order, writ, injunction, judgment or decree, now pending, existing or, to
the knowledge of the Borrower, threatened against the Borrower or any of its
Subsidiaries, affecting any property of the Borrower or any of its Subsidiaries
or with respect to this Agreement or any Loan Document or any Acquisition
Document, whether at law, in equity or otherwise, before any court, board,
commission, agency or instrumentality of any federal, state, local or foreign
government or of any agency or subdivision thereof, or before any arbitrator or
panel of arbitrators which, if adversely determined, might reasonably be
expected to have a Material Adverse Effect.
4.5 TAXES. The Borrower has filed all federal, state and local tax
returns which are required to be filed by the Borrower or its Subsidiaries and,
except to the extent permitted by Section 0 of this Agreement, has paid all
taxes and assessments due as shown on such returns, including interest,
penalties and fees. There are no material tax disputes or contests pending as of
the Closing Date. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of taxes and other governmental charges
are, in the opinion of the Borrower, adequate.
4.6 TITLE. The Borrower and each of its Subsidiaries has good
title to all personal property assets reflected in, and good and marketable
title to all real property assets reflected in, the financial statements
referred to in Sections 0 and 0 of this Agreement and in the financial
statements delivered from time to time pursuant to Section 0 of this Agreement.
There are no Liens on any real or personal property of the Borrower, other than
as permitted by Section 0. The Borrower and each of its Subsidiaries owns, or is
licensed to use, all Intellectual Property material to its business.
4.7 NO BREACH OR DEFAULT. Neither the execution and delivery of
this Agreement and the Loan Documents, nor the consummation of the transactions
contemplated hereby and thereby, nor the compliance with the terms and
provisions hereof and thereof will conflict with or result in a breach of, or
constitute a default under: (a) the articles and By-Laws of the Borrower or any
of its Subsidiaries, (b) any applicable law or regulation, (c) any order, writ,
warrant, injunction or decree of any court or governmental authority or agency,
(d) any material agreement or instrument to which the Borrower or any of its
Subsidiaries is a party or by which it is bound or its property subject, or (e)
result in the creation or imposition of any Lien upon any of the revenues or
assets of the Borrower or its Subsidiaries pursuant to the terms of any such
agreement or instrument.
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4.8 CONSENTS; APPROVALS. Except as set forth on the Supplemental
Schedule, no action, consent or approval of, registration or filing with or any
other action by any governmental authority or other Person is or will be
required in connection with execution and delivery of this Agreement, the Loan
Documents or the Acquisition Documents and the transactions contemplated hereby
and thereby, except such as have been made or obtained and are in full force and
effect.
4.9 LAWFUL OPERATIONS. The Borrower and each of its Subsidiaries,
and each of the operations of the Borrower and such Subsidiaries, are in full
compliance with all requirements imposed by Law (whether statutory,
administrative, judicial or other and whether federal, state, or local but
excluding Environmental Laws to the extent addressed in Section 0 below), except
to the extent any such noncompliance, when taken singly or with all other such
noncompliance, has not resulted, and could not reasonably be expected to result,
in a Material Adverse Effect.
4.10 ENVIRONMENTAL COMPLIANCE. Except for copper emissions from the
Subsidiary's plant in Durham, North Carolina (which emissions do no violate
applicable Environmental Laws), hazardous materials have not been released or
disposed of on any property owned or leased by a the Borrower or any of its
Subsidiaries or, to the best knowledge of the Borrower, any property adjoining
any such properties. All environmental permits have been obtained and are in
effect for the operations conducted at all property owned or leased by the
Borrower or any of its Subsidiaries. The Borrower and each of its Subsidiaries
are in material compliance with all applicable Environmental Laws and all
environmental permits. The Borrower and each of its Subsidiaries have disposed
of all wastes generated, including wastes containing hazardous materials, in
material compliance with all applicable Environmental Laws and environmental
permits. There are no past, pending or, to the actual knowledge of the Borrower,
threatened environmental claims against the Borrower or any of its Subsidiaries
that individually or in the aggregate could have a Material Adverse Effect. No
property owned or leased by the Borrower or any of its Subsidiaries, or to the
best knowledge of the Borrower, any property adjoining any such property, is
listed or proposed for listing on the National Priorities List under CERCLA or
on any other list maintained by any governmental authority of sites requiring
environmental investigation or cleanup. Neither the Borrower nor any if its
Subsidiaries has transported or arranged for the transportation of any hazardous
materials to any location that is listed or proposed for listing on the National
Priorities List under CERCLA or on any other analogous list or, to the best
knowledge of the Borrower, to any location that is the subject of any
environmental claim. To the best knowledge of the Borrower, there are no
circumstances with respect to any property owned or leased by the Borrower or
any of its Subsidiaries or the operations of any of the Borrower or its
Subsidiaries that could reasonably be anticipated (i) to form the basis of an
environmental claim against the Borrower or such Subsidiary or any property
owned or leased by the Borrower or any Subsidiary that individually or in the
aggregate might result in a Material Adverse Effect or (ii) to cause any
property owned or leased by the Borrower or any Subsidiary to be subject to any
restrictions on ownership, occupancy, use or
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transferability under any applicable Environmental Law.
4.11 ERISA. The Supplemental Schedule sets forth all of the
Employee Benefit Plans of the Borrower and its Subsidiaries as of the Closing
Date. The Borrower and each ERISA Affiliate of the Borrower are in compliance in
all material respects with the presently applicable provisions of ERISA and the
Code with respect to each Employee Benefit Plan. No Accumulated Funding
Deficiency exists in respect of any Employee Benefit Plan of Borrower or any of
its ERISA Affiliates. No Reportable Event has occurred in respect of any
Employee Benefit Plan which is continuing and which (i) constitutes grounds
either for termination of the plan or for court appointment of a trustee for the
administration thereof or (ii) has resulted or could result in a Material
Adverse Effect. No "prohibited transaction" (as defined in Section 406 of ERISA
or Section 4975 of the Code), has occurred that: (A) could cause the Borrower or
any of its ERISA Affiliates to incur a material liability or (B) has resulted or
could reasonably be expected to result in a Material Adverse Effect. None of the
Borrower or any of its ERISA Affiliates has (i) had an obligation to contribute
to any Multiemployer Plan except as disclosed in the Supplemental Schedule or
(ii) incurred or reasonably expects to incur any material liability for the
withdrawal from such a Multiemployer Plan. Neither the Borrower nor any ERISA
Affiliate of the Borrower has failed to make any contribution or payment to any
Employee Benefit Plan or Multiemployer Plan, or made any amendment to any
Employee Benefit Plan, which has resulted or could reasonably be expected to
result in the imposition of a Lien on the assets of the Borrower or the posting
of a bond or other security under ERISA or the Code
4.12 ADVERSE OBLIGATIONS; LABOR DISPUTES. Neither the Borrower nor
any of its US Subsidiaries is subject to any contract, agreement, corporate
restriction, judgment, decree or order materially and adversely affecting its
business, property, assets, operations or condition, financial or otherwise. The
Borrower is not in default of any indenture or other agreement evidencing
indebtedness or any other material agreement where such default has or could
reasonably be expected to result in a Material Adverse Effect. As of the Closing
Date, the Borrower is not a party to any labor dispute (other than grievance
disputes which do not individually or in the aggregate materially and adversely
affect any of its operations, financial condition, or business). There are no
material strikes, slow downs, walkouts or other concerted interruptions of
operations by employees whether or not relating to any labor contracts.
4.13 FINANCIAL STATEMENTS. The audited balance sheets of the Borrower
for the Fiscal Year ending December 31, 1996, and the related statements of
income, shareholder's equity, and cash flows, and, as applicable, changes in
financial position or cash flows for such Fiscal Years, and the notes to such
financial statements, reported upon by _______________, certified public
accountants, together with the unaudited internal financial statements
consisting of balance sheet and statements of income, shareholder's equity and
cash flows as of the Fiscal Quarter ending September 30, 1997, certified by an
executive officer of the Borrower: (a) have been prepared in accordance with
GAAP, applied on a consistent basis with the Borrower's financial statements
from prior Fiscal Years and (b) fairly present in all material respects (subject
to routine year-end audit adjustments in the case of the unaudited financial
statements) the financial condition of the
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Borrower as of the respective dates thereof (including a full disclosure of
liabilities, contingent or otherwise, if any) and the results of its operations
for the respective fiscal periods then ending. As of the Closing Date, the
Borrower has not experienced a Material Adverse Effect since the December 31,
1996 financial statements nor any change in the Borrower's accounting procedures
used therein. The Borrower and its Subsidiaries did not as of December 31, 1996,
and will not as of the Closing Date, have any material contingent liabilities,
material liabilities for taxes, unusual and material forward or long-term
commitments or material unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected in said audited balance sheet or
subsequent 10Q.
4.14 VALUE; SOLVENCY. The Borrower has received fair consideration
and reasonably equivalent value for the obligations and liabilities incurred to
the Banks hereunder. The Borrower is Solvent.
4.15 INVESTMENT COMPANY ACT STATUS. Neither the Borrower nor any of
its Subsidiaries is an "investment company," or an "affiliated person" of, or a
"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. Section 80(a)(1), et seq.)).
4.16 USE OF PROCEEDS; REGULATION U/REGULATION X COMPLIANCE. The
proceeds of Loans made to the Borrower pursuant to this Agreement will be used
only for general corporate purposes of the Borrower and as more specifically
provided for in this Agreement. No part of the proceeds of Loans made to the
Borrower pursuant to this Agreement will be used, directly or indirectly, to
purchase or carry any "margin stock" or for a purpose which violates any law,
rule, or regulation including, without limitation, the provisions of Regulation
G, T, U, or X of the Board of Governors of the Federal Reserve System, as
amended. Neither the Borrower nor any of its Subsidiaries owns any "margin
stock," as that term is defined in Regulation U and Regulation X of the Board of
Governors of the Federal Reserve System.
4.17 FULL DISCLOSURE. The Borrower has provided all information
requested by the Agent and the Banks. None of the written information, exhibits
or reports furnished by the Borrower to the Agent or the Banks contain any
untrue material fact or omit to state any material fact necessary to make the
statements contained therein not materially misleading in light of the
circumstances and purposes for which such information was furnished; provided,
however, that, with respect to the projections furnished to the Agent, although
the Borrower is not aware of facts that would make the projections incorrect and
believes that the assumptions underlying the projections were developed in good
faith.
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5 COVENANTS OF THE BORROWER.
So long as any of the Obligations shall remain unpaid, the Banks shall
have any Revolving Credit Commitments and LC Exposure hereunder, or the Letter
of Credit Bank shall have any LC Commitment hereunder, the Borrower will comply
with the following provisions unless the Banks shall otherwise consent in
writing:
5.1 REPORTING AND NOTICE COVENANTS.
(a) QUARTERLY FINANCIAL STATEMENTS. The Borrower shall furnish
to the Banks within forty-five (45) days after the end of each of the
first three Fiscal Quarters of the Borrower, consolidated balance
sheets of the Borrower as at the end of such Fiscal Quarter and the
statements of income and cash flows for such Fiscal Quarter, prepared
on an unaudited comparative basis with the comparable period during the
prior year and in accordance with GAAP.
(b) ANNUAL FINANCIAL STATEMENTS. The Borrower shall furnish to
the Banks as soon as available (and in any event within ninety (90)
days after the end of each Fiscal Year of the Borrower), a complete
copy of the audited consolidated, and internally prepared
consolidating, balance sheets of the Borrower as at the end of such
Fiscal Year and the related consolidated statements of income, retained
earnings, statements of shareholder's equity and cash flows for such
Fiscal Year, and the notes thereto) for that Fiscal Year: (i) prepared
on a comparative basis with the prior year and in accordance with GAAP
except as disclosed therein, (ii) audited and certified (without
qualification) by any nationally recognized independent public
accountants selected by the Borrower and meeting the reasonable
satisfaction of the Agent and the Banks to the effect that such
consolidated financial statements present fairly in all material
respects the financial condition and income of the Borrower and its
consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied and (iii) accompanied by the accountants'
management report relating thereto, if any.
(c) OFFICER'S CERTIFICATES. The Borrower shall furnish to the
Agent and the Banks, concurrently with the financial statements
delivered in connection with Section 0 above and within sixty (60) days
after the end of the fourth Fiscal Quarter of the Borrower, a
certificate of the chief financial officer of the Borrower, in his or
her capacity as chief financial officer, certifying that: (A) with
respect to the first three Fiscal Quarters of the Borrower, to the best
of his knowledge and belief, those financial statements fairly present
in all material respects the financial condition and results of
operations of the Borrower subject (in the case of interim financial
statements) to routine year-end audit adjustments, (B) no Potential
Default or Event of Default then exists or, if any Potential Default or
Event of Default does exist, a brief description of the Potential
Default or Event of Default and the Borrower's intentions in respect
thereto and (C) setting forth the calculations necessary to determine
which of the financial standards specified in
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definition of Applicable LIBOR Margin, Applicable Commitment Fee
Percentage and Applicable Risk Participation Percentage have been
satisfied by the Borrower pursuant to Section 0 of this Agreement and
whether the Borrower is in compliance with the financial covenants
specified in Section 0 of this Agreement.
(d) ANNUAL BUSINESS PLAN. Within sixty (60) days after the end
of each Fiscal Year of the Borrower, the Borrower shall provide the
Agent and the Banks with forecasts prepared by Borrower's management,
in form and substance satisfactory to the Agent and the Banks, of
consolidated and consolidating income statements and consolidated and
consolidating cash flow statements for the Borrower and its
Subsidiaries on a quarterly basis for the next succeeding Fiscal Year.
(e) OTHER INFORMATION. The Borrower shall furnish to the
Agent, promptly upon the Agent's written request, such other
information about the financial condition, properties and operations of
the Borrower, its Subsidiaries and its Employee Benefit Plans as the
Agent may from time to time reasonably request.
(f) PROJECTIONS. The Borrower shall furnish to each of the
Banks, not less than ten (10) days nor more than forty-five (45) days
prior to (1) an acquisition by Borrower of substantially all the assets
or equity interests of another corporation or business enterprise, (2)
a merger or consolidation by the Borrower or any of its Subsidiaries
with any other Person (other than a merger or consolidation referred to
in clause (B) of Section 0, (3) a joint venture with another
corporation or business enterprise, or (4) an investment in or advance
or loan to any person or entity made after the date of this Agreement
pursuant to clause (C) of Section 0 or (iv) below, oral notification to
each Bank regarding such event of the type referred to in clauses (1)
through (4) above and, if any Bank shall request in respect thereto,
twelve (12) month financial projections (the "Projections"), including
a projected balance sheet and cash flow and income statements, prepared
by Borrower's chief financial officer, controller or another officer
reasonably satisfactory to the Required Banks. Notwithstanding the
foregoing, Banks agree that they shall not request Projections in the
event the aggregate dollar amount of such events for a given fiscal
year do not exceed ten percent (10%) of the consolidated Stockholders
Equity of the Companies as of the end of the prior fiscal year. The
Projections shall be prepared on the basis of the historical operations
of the Borrower and its Subsidiaries (and any entity to be acquired or
merged or consolidated with) after giving effect to the event in
question and all reasonable related assumptions. The officer preparing
such Projections shall certify to Banks and the Agent that to the best
of his knowledge and belief such financial information is not
misleading and is accurate in all material respects. The Borrower shall
promptly notify the Banks of any change in the assumptions upon which
the Projections are based between the date of preparation and the date
of the event in question.
(g) NOTICES. The Borrower will cause its chief financial
officer, or in his
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absence another officer designated by him, to give the Agent and each
Bank prompt written notice (and in any event within ten (10) Business
Days) whenever: (i) the Borrower or any of its Subsidiaries receives
notice from any court, agency or other governmental authority of any
alleged non-compliance with any Law or order which could reasonably be
expected to have or result in, if such noncompliance is found to exist,
a Material Adverse Effect, (ii) the Internal Revenue Service or any
other federal, state or local taxing authority shall allege any default
by the Borrower or any of its Subsidiaries in the payment of any tax
material in amount or shall threaten or make any assessment in respect
thereof, (iii) any litigation or proceeding shall be brought against
the Borrower or any of its Subsidiaries before any court or
administrative agency which could, if successfully brought against the
Borrower, reasonably be expected to have or result in a Material
Adverse Effect, (iv) any material adverse change or development in
connection with any such litigation proceeding, or (v) such officer
reasonably believes that any Potential Default or Event of Default has
occurred or that any other representation or warranty made herein shall
for any reason have ceased to be true and complete in any material
respect.
(h) NOTICE OF DEFAULT UNDER ERISA. If Borrower shall receive
notice from any ERISA Regulator or otherwise have actual knowledge that
a Default under ERISA exists with respect to any Employee Benefit Plan,
Borrower shall notify the Agent and each Bank of the occurrence of such
Default under ERISA, within ten (10) Business Days after receiving such
notice or obtaining such knowledge (the disclosures contained in the
Supplemental Schedule being such notice of each Default under ERISA
disclosed therein to the extent of the disclosure therein) and shall:
(i) so long as the Default under ERISA has not been corrected to the
satisfaction of, or waived in writing by the party giving notice, the
Borrower shall thereafter treat as a current liability (if not
otherwise so treated) all liability of Borrower or its Subsidiary that
would arise by reason of the termination of or withdrawal from such
Employee Benefit Plan if such plan was then terminated, and (ii) within
forty-five (45) days of the receipt of such notice or obtaining such
knowledge, furnish to the Agent and each Bank a current consolidated
balance sheet of Borrower with the amount of the current liability
referred to above.
(i) ENVIRONMENTAL REPORTING. The Borrower shall promptly
deliver to the Agent and each Bank, and in any event within ten (10)
Business Days after receipt or transmittal by the Borrower or any of
its Subsidiaries, as the case may be, copies of all material
communications with any government or governmental agency relating to
Environmental Laws and all material communications with any other
Person relating to Environmental Claims brought against the Borrower or
its Subsidiaries which could, in either case, if successfully brought
against the Borrower or such Subsidiaries, reasonably be expected to
result in a Material Adverse Effect.
(j) MULTIEMPLOYER PLAN WITHDRAWAL LIABILITY. The Borrower
shall
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(i) once in each calendar year beginning 1996, request a current
statement of withdrawal liability from each Multiemployer Plan to which
the Borrower or any ERISA Affiliate is or has been obligated to
contribute during such year and (ii) within fifteen (15) days after the
Borrower receives the such current statement, transmit a copy of such
statement to the Agent and each Bank.
5.2 AFFIRMATIVE COVENANTS.
(a) CORPORATE EXISTENCE. The Borrower and each Subsidiary
shall at all times maintain its corporate existence, rights and
franchises.
(b) COMPLIANCE WITH LAW. The Borrower shall comply, and shall
cause each of its Subsidiaries to comply, with all Laws and with every
lawful governmental order (whether administrative or judicial). Without
limiting the generality of the foregoing, the Borrower shall, and shall
cause each of its Subsidiaries to, (a) use and operate all of its
facilities and properties in material compliance with all Environmental
Laws and handle all hazardous materials in material compliance
therewith; keep in full effect each permit, approval, certification,
license or other authorization required by any Environmental Law for
the conduct of any material portion of its business; and comply in all
other material respects with all Environmental Laws (including the
undertaking of any cleanup, remedial or other action necessary in order
to comply with any directive of a governmental authority or
Environmental Law); (b) make a full and timely payment of premiums
required by ERISA and perform and observe all such further and other
requirements of ERISA such that no Default Under ERISA shall occur or
begin to exist and no Lien shall be created; and (c) comply with all
material requirements of all occupational health and safety laws and
federal and state securities laws; provided, however, that, this
Section shall not apply to any of the foregoing (i) if and to the
extent that (x) the same shall be contested in good faith by timely and
appropriate proceedings which are effective to stay enforcement thereof
and against which a bond has been posted or appropriate reserves shall
have been established and as to which no Lien has been created and (y)
non-compliance therewith would not have a Material Adverse Effect or
(ii) if non-compliance would not have a Material Adverse Effect.
(c) INSURANCE. The Borrower will maintain, and will cause each
of its Subsidiaries to maintain, insurance with sound and responsible
insurance companies in such amounts, on such properties and against
such risks as is usually carried by companies of established repute
engaged in the same or similar businesses, owning similar properties,
and located in the same general areas as the Borrower. The Borrower
shall, on the Closing Date and within ten (10) Business Days of the
request by the Agent thereafter, provide evidence (including, without
limitation, full policies if so requested) satisfactory to the Agent
that the Borrower has adequate personal and real property, liability,
business interruption and product liability insurance.
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(d) TAXES. The Borrower shall pay in full, and shall cause
each of its Subsidiaries to pay in full, prior in each case to the date
when penalties for the nonpayment thereof would attach, all taxes,
assessments and governmental charges and levies for which it may be or
become subject and all lawful claims which, if unpaid, might become a
Lien upon its property; provided, however, that no such tax,
assessment, charge or levy need be paid so long as and to the extent
that it is contested in good faith and by timely and appropriate
proceedings effective to stay, during the pendency of such proceedings,
the enforcement thereof and the creation of any Lien, and appropriate
reserves, as required by GAAP, are made on the books of the Borrower
and its Subsidiaries.
(e) PROPERTIES; FINANCIAL RECORDS. The Borrower will keep, and
will cause each of its Subsidiaries to keep, all of its properties
necessary in its business in good working order and condition, ordinary
wear and tear excepted. The Borrower shall maintain at all times, true
and complete financial records in accordance with GAAP, consistently
applied, and, without limiting the generality of the foregoing, make
appropriate accruals to reserves for estimated and contingent losses
and liabilities as required under GAAP.
(f) VISITATION. The Borrower shall promptly upon written or
oral request of the Agent or any Bank permit, and shall cause each of
its Subsidiaries to permit, the Agent or such Bank, as the case may be,
during normal business hours: (i) to examine, with the guidance and
supervision of the Borrower, the Borrower's financial records and to
make copies of and extracts from such records and (ii) upon prior
reasonable notice to the Borrower, to consult with the Borrower's and
its Subsidiaries' officers, directors, accountants, actuaries, trustees
and plan administrators, as the case may be, in respect of the
Borrower's and its Subsidiaries' financial condition, each of which
parties is hereby authorized by the Borrower to make such information
available to such Bank to the same extent that it would to the Borrower
subject only to such professional and legal restrictions to which such
parties may be bound and which cannot be waived by the Borrower or its
Subsidiaries.
(g) DOMESTIC SUBSIDIARIES AS SUBSIDIARY GUARANTORS. Within
thirty (30) days after the creation or acquisition of any Domestic
Subsidiary, the Borrower shall cause such Domestic Subsidiary to
execute and deliver to the Agent and each of the Banks, an
appropriately executed Subsidiary Guaranty, together with a Domestic
Subsidiary Certificate.
(h) INTEREST RATE PROTECTION AGREEMENTS. Prior to the
execution of any interest rate protection agreement, the Borrower
shall, and shall cause each of its Subsidiaries to, submit such
agreement to the Agent for its review for compliance with the current
ISDA documentation standards.
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5.3 NEGATIVE COVENANTS.
(a) MERGERS; SALES OF ASSETS; FUNDAMENTAL TRANSACTIONS. The
Borrower shall not, and shall not permit any of its Subsidiaries to,
(i) merge or consolidate with or into, or enter into any agreement to
merge or consolidate with or into, any other Person or otherwise be a
party to any merger or consolidation, (ii) purchase (whether in one
transaction or a series of transactions) all or substantially all of
the assets and business or equity of any other Person, (iii) acquire
any Subsidiary other than the Subsidiaries set forth on the
Supplemental Schedule, or (iv) lease as lessor, sell, sell-leaseback or
otherwise transfer (whether in one transaction or a series of
transactions) its business or assets (whether now owned or hereafter
acquired); except, that, if immediately after giving effect to such
transaction no Event of Default or Potential Default shall have
occurred, the Borrower and its Subsidiaries may from and after the
Closing Date: (A) enter into a merger or consolidation involving only
Subsidiaries of the Borrower or any merger involving only the Borrower
and one or more of its Subsidiaries in which the Borrower is the
surviving corporation, (B) acquire all or substantially all of the
assets or equity of other Persons (other than the Acquisitions) other
than as set forth in clause (A) above (whether by merger or purchase
and whether in one transaction or a series of transactions) so long as
(x) the target or resulting entity is in the same, substantially
similar or a complementary line of business, (y) the Borrower shall
have establish Pro Forma Covenant Compliance and, to the extent
Projections are requested, the Required Banks do not reasonably object
to the assumptions or other information upon which the relevant
Projections were based and (z) prior to the consummation thereof, the
Agent shall have received copies of the acquisition documents together
with an acquisition certificate, (C) acquire all or substantially all
of the equity of other Persons in connection with the Acquisitions
other than as set forth in clause (A) above so long as prior to the
consummation thereof, the Agent shall have received copies of the
Acquisition Documents together with an Acquisition Certificate and (D)
lease as lessor, sell, sell-leaseback or otherwise transfer its assets
(other than the sale or transfer by the Borrower of any of the capital
stock of any of the Borrower's Subsidiaries) so long as (I) such sale,
lease or transfer is for not less than the fair market value of such
assets, (II) the consideration received therefor is cash or cash
equivalents and (III) the aggregate amount of such transactions entered
into during the term of this Agreement does not exceed Five Million
Dollars ($5,000,000).
(b) CREDIT EXTENSIONS; INVESTMENTS. The Borrower shall not,
except as disclosed in the Supplemental Schedule, and shall not permit
any of its Subsidiaries to, (i) loan any money to or Guaranty or assume
any obligation of any other Person or (ii) make prepayments or advances
to others (except to the Bank in accordance with this Agreement);
except, that this Section shall not apply to: (A) any existing or
future advance, commission or relocation payment, or other loan or
advance made to an employee or to a director or officer of the Borrower
or its Subsidiaries in the ordinary course of business and consistent
with past practice, (B) any Permitted US Investments or
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(C) any Permitted Foreign Investments; provided, however, that the
aggregate amount of such Permitted Foreign Investments in clause (C)
outstanding at any time shall not exceed Thirty-Five Million Dollars
($35,000,000), (D) any existing investment, advance, loan or Guaranty
fully disclosed in the Companies' December 31, 1996 consolidated
audited financial statements or in the Supplemental Schedule, (E) any
other investment, advance or loan provided that (x) the entity invested
in or to which an advance or loan is made is in the same, substantially
similar or a complementary line of business and (y) the Borrower is
able to establish Proforma Covenant Compliance and, to the extent
Projections are requested, the Required Banks do not reasonably object
to the assumptions or other information upon which the relevant
Projections were based, (F) any intercompany loan by the Borrower (not
otherwise permitted by clause (D) above) to, any investment by the
Borrower in, or any Guaranty by the Borrower of any indebtedness of,
any Subsidiary of the Borrower in which the Borrower owns one hundred
percent (100%) of the outstanding common stock (except for shares owned
by directors as required by law); provided, however, that,(X) at the
time of and after giving effect to any such loan or Guaranty (I) no
Potential Default or Event of Default shall have occurred and be
continuing and (II) if such loan or Guaranty exceeds ten percent (10%)
of the Borrower's Consolidated Net Worth, then the Borrower shall
establish Proforma Covenant Compliance and, to the extent Projections
are requested, the Required Banks do not reasonably object to the
assumptions or other information upon which the relevant Projections
were based and (Y) this subsection shall not prohibit any intercompany
loan by the Borrower to, investment by the Borrower in or Guaranty by
the Borrower of the indebtedness of, any joint venture of any
Subsidiary of the Borrower or any of its Subsidiaries with respect to a
Congo smelter project so long as the aggregate amount of any such
loans, investments or guaranties does not exceed Forty Million Dollars
($40,000,000), (G) any endorsement of a check or other medium of
payment for deposit or collection, or any similar transaction in the
normal course of business, or (H) pre-payment for raw materials in the
ordinary course of business and trade accounts arising and outstanding
in the ordinary course of business unless represented by a promissory
note or other instrument.
(c) INDEBTEDNESS. The Borrower shall not, and shall not permit
any Subsidiary to, create, assume, incur, suffer to exist or have
outstanding at any time any indebtedness for borrowed money or any
Funded Indebtedness or other debt of any kind to the extent (i) the
same would cause a violation of the financial covenants set forth in
Section 0 or otherwise violate any other term or provision of this
Agreement or any of the Loan Documents and (ii) the same has covenants
or defaults materially more restrictive on the Borrower and its
Subsidiaries than those set forth in this Agreement.
(d) LIENS; LEASES. The Borrower shall not, and shall not
permit any of its Subsidiaries to, (i) acquire or hold any property
subject to any Lien, (ii) suffer or permit any property now owned or
hereafter acquired by it to be or become encumbered by a Lien, (iii)
sell or otherwise transfer receivables with recourse; except, that this
Section
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shall not prohibit: (A) any lien for a tax, assessment or government
charge or levy for taxes, assessments or charges not yet due and
payable or not yet required to be paid pursuant to Section 0, (B) any
deposits or cash pledges securing only workers' compensation,
unemployment insurance or similar obligations (other than Liens arising
under ERISA) in the ordinary course of business, (C) any mechanic's,
carrier's, landlord's or similar common law or statutory lien incurred
in the normal course of business for amounts that are not yet due and
payable or which are being diligently contested in good faith, so long
as the Agent has been notified thereof and adequate reserves are
maintained for their payment, (D) zoning or deed restrictions, public
utility easements, minor title irregularities and similar matters
having no adverse affect as a practical matter on the ownership or use
of any of the property in question, (E) any Lien (1) which arises in
connection with judgments or attachments the occurrence of which does
not constitute an Event of Default under Section 0 and (2) the
execution or other enforcement of such Lien is effectively stayed and
the claims secured thereby are being actively contested in good faith
and by appropriate proceedings, (F) deposits or cash pledges securing
performance of contracts, bids, tenders, leases (other than Capitalized
Leases), statutory obligations, surety and appeal bonds; provided,
that, clauses (A) through (G) shall only apply to Liens arising by
operation of law and in the ordinary course of business and shall not
apply to any Lien that secures indebtedness for borrowed money or any
Guaranty thereof or any obligation that is in material default in any
manner (other than any default contested in good faith by timely and
appropriate proceedings effective to stay the enforcement of such Lien
and against which a bond has been posted or appropriate reserves shall
have been established), (G) any Lien in favor of the Bank or any
existing Lien fully disclosed in the Supplemental Schedule, (H) any
Lien (including any Lien in respect of a Capitalized Lease of real
property) which is created or assumed in purchasing, constructing or
improving any real property or to which any real property is subject
when purchased; provided, however, that: (x) the mortgage, security
interest or other lien is confined to the property in question and (y)
the Indebtedness secured thereby does not exceed the total cost of the
purchase, construction or improvement and (z) the aggregate outstanding
Indebtedness secured by such Liens (when taken together with any
secured Indebtedness permitted to be secured pursuant to clause (L) of
this subsection) does not at any time exceed Five Million Dollars
($5,000,000), (I) any transfer of a check or other medium of payment
for deposit or collection, or any similar transaction in the normal
course of business, (J) any financing statement perfecting a security
interest that would be permissible under this subsection or (J) any
Lien (including any Lien in respect of a Capitalized Lease of personal
property) which is created in purchasing personal property; provided,
however, that: (x) the Lien is confined to the property in question,
(y) the Indebtedness secured thereby does not exceed the total cost of
the purchase, and (z) the aggregate outstanding Indebtedness secured by
such Liens (when taken together with any secured Indebtedness permitted
to be secured pursuant to clause (H) of this subsection) does not at
any time exceed Five Million Dollars ($5,000,000).
(e) DIVIDENDS. The Borrower shall not make or commit itself to
make any
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Distribution (other than stock dividends) to its shareholders at any
time; except that, if immediately after giving effect to such
transaction no Event of Default or Potential Default shall have
occurred, the Borrower may, during any Fiscal Year: (i) make
Distributions consisting of dividends payable solely in cash in an
aggregate amount not to exceed the greater of (x) Twelve Million
Dollars ($12,000,000) or (y) twenty-five percent (25%) of the
Consolidated Net Income for such Fiscal Year.
(f) ACCOUNTING CHANGES. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit any change in its
accounting policies or financial reporting practices and procedures,
except as required or permitted by GAAP or any changes in financial
reporting practices and procedures which are required or permitted by
GAAP, in each case as to which the Borrower shall have delivered to the
Agent prior to the effectiveness of any such change a report prepared
by a responsible officer of the Borrower describing such change and
explaining in reasonable detail the basis therefor and effect thereof.
(g) USE OF PROCEEDS. The Borrower shall not use the proceeds
of the Loans for any purpose other than: (i) to refinance Indebtedness
owing to the Borrower's existing banking facility, (ii) to finance the
consummation of the Acquisitions, (iii) to finance acquisitions
(whether of assets or stock, by purchase or merger) as permitted by
Section 0 of this Agreement, and (iv) for working capital and other
general corporate purposes.
(h) COMPLIANCE WITH ERISA. The Borrower shall not and shall
not permit any ERISA Affiliate to: (i) engage in any transaction in
connection with which the Borrower or any ERISA Affiliate could
reasonably be expected to be subject to either a civil penalty assessed
pursuant to section 502(i) of ERISA or a tax imposed by section 4975 of
the Code, terminate or withdraw from any Employee Benefit Plan (other
than a Multiemployer Plan) in a manner, or take any other action with
respect to any such Employee Benefit Plan (including, without
limitation, a substantial cessation of business operations or an
amendment of an Employee Benefit Plan within the meaning of section
4041(e) of ERISA), which could reasonably be expected to result in any
liability of the Company or any ERISA Affiliate to the PBGC, to the
Department of Labor or to a trustee appointed under section 4042(b) or
(c) of ERISA, incur any liability to the PBGC on account of a withdraw
from or a termination of an Employee Benefit Plan under section 4063 or
4064 of ERISA, incur any liability for post-retirement benefits under
any and all welfare benefit plans (as defined in section 3(1) of ERISA)
other than as required by applicable statute, fail to make full payment
when due of all amounts which, under the provisions of any Employee
Benefit Plan or applicable Law, the Borrower or any ERISA Affiliate is
required to pay as contributions thereto, or permit to exist any
Accumulated Funding Deficiency, whether or not waived, with respect to
any Employee Benefit Plan (other than a Multiemployer Plan); provided,
however, that such engagement, termination, withdrawal, action,
incurrence, failure or permitting shall not be deemed to have violated
this clause (i) unless such engagement, termination, withdrawal,
action,
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incurrence, failure or permitting, when taken singly or together with
other such engagements, terminations, withdrawals, actions,
incurrences, failures or permittings, has resulted or could reasonably
be expected to result in a Material Adverse Effect; (ii) at any time
permit the termination of any defined benefit pension plan intended to
be qualified under section 401(a) and 501(a) of the Code; provided,
however, that such termination shall not be deemed to have violated
this clause (ii) unless (A) the value of all benefit liabilities (as
defined in section 4001(a)(16) of ERISA) upon the termination date of
all such terminated defined benefit pension plans of the Borrower, its
Subsidiaries and their ERISA Affiliates exceeds the then current value
(as defined in section 3 of ERISA) of all assets in such terminated
defined benefit pension plans by an amount in excess of One Million
Dollars ($1,000,000) in the aggregate or (B) the payment of such amount
has resulted or could reasonably be expected to result in a Material
Adverse Effect; or (iii) if the Borrower or any ERISA Affiliate becomes
obligated under a Multiemployer Plan (except with respect to the
potential liabilities now existing as disclosed in the Supplemental
Schedule), effect a complete or partial withdrawal such that the
Borrower, its Subsidiaries or their ERISA Affiliates incur Withdrawal
Liability under Title IV of ERISA with respect to Multiemployer Plans
or otherwise have liability under Title IV of ERISA; provided, however,
that the incurrence of such Withdrawal Liability or other liability
under Title IV of ERISA shall not be deemed to be a violation of this
clause (iii) unless, the amount the payment by the Borrower of such
Withdrawal Liability or other liability has resulted or could
reasonably be expected to result in a Material Adverse Effect or could
reasonably be expected to result in the imposition of a Lien.
(i) CHANGE IN NATURE OF BUSINESS. The Borrower shall not, and
shall not permit any of its Subsidiaries to, make any material change
in the nature of its business as carried on at the date hereof.
(j) REGULATION U COMPLIANCE. The Borrower shall not use any
portion of the proceed of any Loan for the purpose of purchasing or
carrying any Margin Stock or for any other purpose in violation of any
requirement of Law or of the terms and conditions of this Agreement.
5.4 FINANCIAL COVENANTS.
(a) CONSOLIDATED TOTAL FUNDED DEBT TO EBITDA RATIO. The
Borrower shall not permit the Consolidated Total Funded Debt to EBITDA
Ratio as at the end of any Fiscal Quarter to exceed 3.00 to 1.00 for
the Cumulative Four Quarter Period then ending.
(b) CONSOLIDATED TOTAL FUNDED DEBT. The Borrower shall not
permit the Consolidated Total Funded Debt to exceed fifty percent (50%)
of the sum of the Consolidated Total Funded Debt plus Consolidated Net
Worth as at the end of any Fiscal Quarter, commencing with the Fiscal
Quarter ending March 31, 1998.
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6 EVENTS OF DEFAULT.
The occurrence of any one or more of the following events shall
constitute an "Event of Default" under this Agreement:
6.1 PAYMENT FAILURE. Failure by the Borrower to: (a) make payment
of principal on the Revolving Credit Notes or (b) pay interest on the Revolving
Credit Notes or pay any other Obligation when required to be paid hereunder to
the extent such failure is not remedied within Five (5) Business Days after such
required date of payment hereunder; or
6.2 REPRESENTATIONS AND WARRANTIES. Any representation or
warranty made or deemed made by the Borrower in respect of the Borrower or any
Subsidiary of the Borrower in this Agreement, any Loan Document or any
certificate, document or financial or other statement furnished at any time in
compliance with or in reference to this Agreement shall prove to have been false
or inaccurate in any material respect when made or deemed to have been made; or
6.3 REPORTING AND NOTICE PROVISIONS; VIOLATION OF CERTAIN
AFFIRMATIVE COVENANTS. Failure by the Borrower (in respect of the Borrower or
any Subsidiary of the Borrower): (a) to perform, keep, or observe any other
term, provision, condition or covenant contained in Section 0(e) through 0(i) of
this Agreement which is required to be performed, kept, or observed by the
Borrower (in respect of the Borrower or any Subsidiary of the Borrower) and such
failure shall continue without remedy for a period of ten (10) Days after
written notice from the Agent and (b) to perform, keep or observe any other
term, provision, condition or covenant contained in this Agreement (other than
those provisions, terms or conditions referenced in Sections 0, 0 and 0 of this
Agreement) which is required to be kept or observed by the Borrower (in respect
of the Borrower or any Subsidiary of the Borrower) and such failure shall
continue without remedy for a period of Thirty (30) Days; or
6.4 VIOLATION OF NEGATIVE COVENANTS; VIOLATION OF CERTAIN OTHER
COVENANTS. Failure by the Borrower (in respect of the Borrower or any
Subsidiary of the Borrower) to perform, keep, or observe any other term,
provision, condition or covenant contained in Section 0(a) through 0(d), 0 or 0
of this Agreement which is required to be performed, kept, or observed by the
Borrower (in respect of the Borrower or any Subsidiary of the Borrower); or
6.5 LOAN DOCUMENTS. Failure by the Borrower or any of its
Subsidiaries to perform, keep, or observe any other term, provision, condition
or covenant contained in this Agreement or any of the Loan Documents which is
required to be performed, kept, or observed by the Borrower (in respect of the
Borrower or any Subsidiary of the Borrower), subject to any cure periods set
forth therein; or
6.6 CROSS-DEFAULT. Any indebtedness of the Borrower or any of its
Subsidiaries for borrowed money (regardless of maturity) or any of its Funded
Indebtedness shall be or become
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"in default" (as defined below), unless the aggregate unpaid principal balance
of all such indebtedness in default does not exceed Five Million Dollars
($5,000,000) at any one time outstanding or if any Event of Default occurs
pursuant to the Note Purchase Agreement or upon the prepayment of the senior
notes issued pursuant thereto upon a Change in Control as provided in Section
8.4 of the Note Purchase Agreement. In this subsection, "in default" means that
(a) there shall have occurred (or shall exist) in respect of the indebtedness in
question (either as in effect at the date of this Agreement or as in effect at
the time in question) any event, condition or other thing which constitutes, or
which with the giving of notice or the lapse of any applicable grace period or
both would constitute, a default which would permit any creditor or creditors or
representative or creditors to accelerate the maturity of any such indebtedness;
or (b) any such indebtedness (other than any payable on demand) shall not have
been paid in full at its stated maturity; or (c) any such indebtedness payable
on demand shall not have been paid in full within ten (10) Banking Days after
any actual demand for payment; or
6.7 TERMINATION OF EXISTENCE. The dissolution or termination of
existence of the Borrower or the discontinuation of the business of the
Borrower; or
6.8 CONTROL. The occurrence of any Change in Control; or
6.9 FAILURE OF ENFORCEABILITY OF THIS AGREEMENT OR ANY LOAN
DOCUMENT. If: (a) any material covenant, agreement or obligation of the Borrower
(in respect of the Borrower or any Subsidiary of the Borrower) contained in or
evidenced by this Agreement or any of the Loan Documents shall cease to be
enforceable, or shall be determined to be unenforceable, in accordance with its
terms or (b) the Borrower or any Subsidiary of the Borrower shall deny or
disaffirm its obligations under this Agreement or any of the Loan Documents; or
6.10 JUDGMENTS. Any judgment for the payment of money (other than
one which is covered by insurance and as to which the insurance carrier shall
have acknowledged coverage in the amount of the insurance without any
reservation of rights or shall have been ordered by a court of competent
jurisdiction to pay such judgment) involving at any time an amount, when taken
together with other such money judgments, in excess of Five Million Dollars
($5,000,000) in the aggregate, shall be rendered against the Borrower or any of
its Subsidiaries and either: (a) such money judgment is not discharged, vacated,
fully bonded or stayed within thirty (30) days after such judgment rendered, (b)
any money judgment is docketed to become a Lien against assets of the Borrower
or any of its Subsidiaries in an amount, when taken together with other such
money judgments, in excess of Five Million Dollars ($5,000,000) or (c) any
action shall be taken by a judgment creditor to attach or levy upon the assets
of the Borrower or any of its Subsidiaries to enforce such judgment; or
6.11 FORFEITURE PROCEEDINGS. The institution against the Borrower
of any criminal proceedings for which forfeiture of any asset or assets; or
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6.12 PAYMENT OF DEBTS. The Borrower or any of its Subsidiaries
shall admit in writing its inability to, or be generally unable to, pay its
debts as such debts become due; or
6.13 VOLUNTARY PROCEEDINGS. The Borrower or any of its Subsidiaries
shall: (a) apply for or consent to the appointment of, or the taking of
possession by, any receiver, custodian, trustee or liquidator for the Borrower
or any of its Subsidiaries or for all or a substantial part of its assets, (b)
make a general assignment for the benefit of creditors, (c) commence a voluntary
case or proceeding or file any petition seeking liquidation, reorganization or
other relief under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, (d) consent to the
institution of, acquiesce in writing to, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in Subsection 0 below,
(e) file an answer admitting the material allegations of a petition filed
against it in any such proceeding or (f) take any action for the purpose of
effecting any of the foregoing; or
6.14 INVOLUNTARY PROCEEDINGS. The Borrower or any of its
Subsidiaries shall have commenced or filed against it an involuntary proceeding
or an involuntary petition seeking: (a) liquidation, reorganization or other
relief in respect of the Borrower or any of its Subsidiaries, its debts or all
or a substantial part of its assets under any Federal, state or foreign
bankruptcy, insolvency, receivership, or similar law now or hereafter in effect
or (b) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower, any of its Subsidiaries or for
a substantial part of its assets, and, in any such case, either (i) such
proceeding or petition shall continue undismissed for sixty (60) days or (ii) an
order or decree approving or ordering any of the foregoing shall be entered.
7 REMEDIES.
7.1 OPTIONAL DEFAULTS. Upon the occurrence of an Event of Default
described above in Sections 0 through 0 above, inclusive, the Agent may, with
the consent of the Required Banks, and shall, upon the direction of the Required
Banks, (a) declare all of the Obligations due or to become due from the Borrower
to the Agent and the Banks, whether under this Agreement, the Revolving Credit
Notes or otherwise, at the option of the Agent, immediately due and payable,
anything in the Revolving Credit Notes or other evidence of the Obligations or
in any of the other Loan Documents to the contrary notwithstanding and (b)
terminate each Bank's Revolving Credit Commitment whereupon none of the Banks
shall have any further obligation to make any Revolving Credit Loan hereunder.
7.2 AUTOMATIC DEFAULTS. If any Event of Default referred to in
Sections 0 or 0 above shall occur, (a) each Bank's Revolving Credit Commitment
shall automatically and immediately terminate (if not already expired or
terminated by the Borrower or terminated pursuant to this Section 0) whereupon
no Bank shall have any obligation thereafter to make any Revolving Credit Loan
hereunder and (b) all of the Obligations and all other Indebtedness, if any,
then owing to the Banks (other than Indebtedness, if any, already due and
payable) shall thereupon become, and thereafter be, immediately due and payable
in full, all without any presentment, demand or notice
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of any kind, which are hereby waived by the Borrower.
7.3 GENERAL RIGHTS AND REMEDIES OF AGENT AND THE BANKS. The Agent
and the Banks shall have all other legal and equitable rights to which the Agent
and the Banks may be entitled, all of which rights and remedies shall be
cumulative, and none of which shall be exclusive, to the extent permitted by
law, in addition to any other rights or remedies contained in this Agreement or
in any of the other Loan Documents. Each Bank hereby expressly agrees that,
unless requested by the Agent with the concurrence of the Required Banks, such
Bank shall not take or cause to be taken, in respect of the Loans or the other
Obligations, any action or remedy that is independent from the actions or
remedies taken or to be taken by the Agent, except for any actions taken by any
Bank in connection with any Event of Default described in Sections 0 or 0 of
this Agreement.
7.4 SET-OFF. If any Event of Default referred to in Section 0 of
this Agreement shall occur which has not been waived in writing by the Required
Banks, each Bank shall have the right (in addition to such other rights as it
may have by operation of Law or otherwise but subject to Section 0 of this
Agreement) at any time to set off against and to appropriate and apply toward
the payment of the Obligations and all other Indebtedness then owing to it (and
any participation purchased or to be purchased pursuant to Section 0 below)
whether or not the same shall then have matured, any and all deposit balances
then owing by that Bank to or for the credit or account of the Borrower, all
without notice to or demand upon the Borrower or any other Person, all such
notices and demands being hereby expressly waived.
7.5 ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON DEFAULT. Upon
the occurrence of Event of Default (unless waived in writing by the Banks in
accordance with this Agreement), to the extent that any Letters of Credit have
been issued which then are outstanding, the Agent, for the benefit of the Letter
of Credit Bank and the Banks, may, and upon the direction of the Required Bank's
shall (whether in addition to taking any of the actions described in this
Section 0 or otherwise), make demand upon Borrower to, and forthwith upon such
demand the Borrower will, pay to the Agent in same day funds, for deposit in a
special cash collateral account (the "Letter of Credit Collateral Account"), to
secure the obligations of the Borrower in respect of any outstanding Letters of
Credit, to be maintained at such office of the Agent as Agent shall direct, an
amount equal to the maximum amount available to be drawn under the Letters of
Credit. In the event that Borrower shall not deposit such funds upon demand by
the Agent, the Agent may, in its sole discretion, deposit any other funds of
Borrower in the possession of the Agent, to the Letter of Credit Collateral
Account until the amount deposited in such account equals the maximum amount
available to be drawn under the Letters of Credit. The Letter of Credit
Collateral Account shall be in the name of Agent (as a cash collateral account),
but under the sole dominion and control of the Agent and subject to the terms of
this Agreement.
7.6 LETTER OF CREDIT COLLATERAL ACCOUNT.
(a) APPLICATION. The Agent may, at any time or from time to
time after
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funds are deposited in the Letter of Credit Collateral Account, apply
funds then held in the Letter of Credit Collateral Account to the
payment of any amounts, in such order as the Agent may elect or shall
be directed by the Banks, as shall have become or shall become due and
payable by the Borrower to the Letter of Credit Bank under this
Agreement or any Reimbursement Agreement first, in respect of the
Letters of Credit and second, after the occurrence and during the
continuance of any Event of Default, in respect of all other amounts
constituting Obligations.
(b) NO BORROWER OR THIRD PARTY CLAIMS. Neither the Borrower
nor any Person claiming on behalf of or through Borrower shall have any
right to withdraw any of the funds held in the Letter of Credit
Collateral Account.
(c) NO LIENS OR TRANSFERS OF ACCOUNT. The Borrower agrees that
it will not: (i) sell or otherwise dispose of any interest in the
Letter of Credit Collateral Account or any funds held therein, or (ii)
create or permit to exist any lien, security interest or other charge
or encumbrances upon or with respect to the Letter of Credit Collateral
Account or any funds held therein, except as provided in or
contemplated by this Agreement.
(d) REASONABLE CARE. The Agent shall exercise reasonable care
in the custody and preservation of any funds held in the Letter of
Credit Collateral Account and shall be deemed to have exercised such
care if such funds are accorded treatment substantially equivalent to
that which the Agent accords its own property, it being understood that
the Agent shall not have any responsibility for taking any necessary
steps to preserve rights against any parties with respect to any such
funds.
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7.7 TERMINATION; EFFECT ON BORROWER OBLIGATIONS. Any termination
by the Agent and\or any Bank of its performance pursuant to this Section 0 shall
not absolve, release, or otherwise affect the liability of the Borrower in
respect of transactions prior to such termination or affect any of the Liens,
rights, powers, and remedies of the Agent or such Bank, which such Liens,
rights, powers and remedies shall, in all events, continue until all Obligations
of the Borrower to the Agent and the Banks are satisfied.
7.8 EQUALIZATION. Each Bank agrees with the other Banks that if at
any time it shall obtain any Advantage over the other Banks or any thereof in
respect of the Loans it will purchase from such other Bank or Banks, for cash
and at par, such additional participation in the Loans owing to the other or
others as shall be necessary to nullify the Advantage. If any such Advantage
resulting in the purchase of an additional participation as aforesaid shall be
recovered in whole or in part from the Bank receiving the Advantage, each such
purchase shall be rescinded, and the purchase price restored (with interest and
other charges if and to the extent actually incurred by the Bank receiving the
Advantage) ratably to the extent of the recovery. During the existence of any
Potential Default, any payment (whether made voluntarily or involuntarily, by
offset of any deposit or other indebtedness or otherwise) of any Indebtedness
owing by the Borrower to any Bank shall be applied to the Obligations owing to
that Bank until the same shall have been paid in full before any thereof shall
be applied to other Indebtedness owing to that Bank.
7.9 REMEDIES CUMULATIVE. The above-stated remedies are not
intended to be exhaustive and the full or partial exercise of any of such
remedies shall not preclude the full or partial exercise of any other remedy by
the Agent under this Agreement, under any Loan Document, or at equity or under
at law.
8 THE AGENT.
8.1 THE AGENT. Each Bank irrevocably appoints the Agent to act as
agent under this Agreement and the Loan Documents for the benefit of such Bank,
with full authority to take such actions, and to exercise such powers, on behalf
of the Banks in respect of this Agreement and the Loan Documents as are herein
and therein respectively delegated to the Agent or as are reasonably incidental
to those delegated powers. The Agent in such capacity shall be deemed to be an
independent contractor of the Banks.
8.2 NATURE OF APPOINTMENT. The Agent shall have no fiduciary
relationship with any Bank by reason of this Agreement and the Loan Documents.
The Agent shall not have any duty or responsibility whatsoever to any Bank
except those expressly set forth in this Agreement and the Loan Documents.
Without limiting the generality of the foregoing, each Bank acknowledges that
the Agent is acting as such solely as a convenience to the Banks and not as a
manager of the commitments or the Obligations evidenced by the Revolving Credit
Notes. This Section 0 does not confer any rights upon the Borrower or anyone
else (except the Banks), whether as a third party beneficiary or otherwise.
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8.3 AGENT AS A BANK; OTHER TRANSACTIONS. The Agent's rights as a
Bank under this Agreement and the Loan Documents shall not be affected by its
serving as the Agent. The Agent and its Affiliates may generally transact any
banking, financial, trust, advisory or other business with the Borrower
(including, without limitation, the acceptance of deposits, the extension of
credit and the acceptance of fiduciary appointments) without notice to the
Banks, without accounting to the Banks, and without prejudice to the Agent's
rights as a Bank under this Agreement and the Loan Documents except as may be
expressly required under this Agreement.
8.4 INSTRUCTIONS FROM BANKS. The Agent shall not be required to
exercise any discretion or take any action as to matters not expressly provided
for by this Agreement and the Loan Documents (including, without limitation,
collection and enforcement actions in respect of any Obligations under the
Revolving Credit Notes or this Agreement and any collateral therefor), except
that the Agent shall take such action, or omit to take such action (other than
actions referred to in Section 0 of this Agreement), as may be reasonably
requested, with instructions in writing, by the Required Banks or all of the
Banks, as applicable pursuant to Section 0 of this Agreement and which actions
and omissions shall be binding upon all of the Banks; provided, however, that
the Agent shall not be required to act (or omit any act) if, in its judgment,
any such action or omission might expose the Agent to personal liability or
might be contrary to this Agreement, any Loan Document or any applicable Law.
8.5 BANK'S DILIGENCE. Each Bank: (a) represents and warrants that
it has made its own decision to enter into this Agreement and the Loan Documents
and (b) agrees that it will make its own decision as to taking or not taking
future actions in respect of this Agreement and the Loan Documents; in each case
without reliance on the Agent or any other Bank and on the basis of its
independent credit analysis and its independent examination of and inquiry into
such documents and other matters as it deems relevant and material.
8.6 NO IMPLIED REPRESENTATIONS. The Agent shall not be liable for
any representation, warranty, agreement or obligation of any kind of any other
party to this Agreement or anyone else, whether made or implied by any Borrower
in this Agreement or any Loan Document or by a Bank in any notice or other
communication or by anyone else or otherwise.
8.7 SUB-AGENTS. The Agent may employ agents and shall not be
liable (except as to money or property received by it or its agents) for any
negligence or misconduct of any such agent selected by it with reasonable care.
8.8 AGENT'S DILIGENCE. The Agent shall not be required: (a) to
keep itself informed as to any Person's compliance with any provision of this
Agreement or any Loan Document, (b) to make any inquiry into the properties,
financial condition or operation of the Borrower or any other matter relating to
this Agreement or any Loan Document, (c) to report to any Bank any information
(other than which this Agreement or any Loan Document expressly requires to be
so
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reported) that the Agent or any of its Affiliates may have or acquire in respect
of the properties, business or financial condition of the Borrower or any other
matter relating to this Agreement or any Loan Document or (d) to inquire into
the validity, effectiveness or genuineness of this Agreement or any Loan
Document.
8.9 NOTICE OF DEFAULT. The Agent shall not be deemed to have
knowledge of any Potential Default or Event of Default unless and until it shall
have received a written notice from the Borrower or any Bank describing it and
citing the relevant provision of this Agreement or any Loan Document. The Agent
shall give each Bank prompt notice of any such written notice other than the
Bank that shall have given the written notice of the Event of Default.
8.10 AGENT'S LIABILITY. Neither the Agent nor any of its directors,
officers, employees, attorneys, and other agents shall be liable for any action
or omission on their respective parts except for gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent:
(a) may treat the payee of any Revolving Credit Note as the holder thereof until
the Agent receives a fully executed copy of the Assignment Agreement required by
Section 0 of this Agreement signed by such payee and in form satisfactory to the
Agent and the fee required by Section 0 of this Agreement; (b) may consult with
legal counsel, independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice or such counsel, accountants or
experts which have been selected by the Agent with reasonable care; (c) makes no
warranty or representation to any Bank and shall not be responsible to any Bank
for any statements, warranties or representations made in or in connection with
this Agreement or any other Loan Document, including, without limitation, the
truth of the statements made in any certificate delivered by the Borrower under
Sections 0 or 0 of this Agreement or in any Credit Request, Rate
Continuation/Conversion Request or any other similar notice or delivery, the
Agent being entitled for the purposes of determining fulfillment of the
conditions set forth therein to rely conclusively upon such certificates; (d)
shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of this Agreement, the
Revolving Credit Notes or any other Loan Document or to inspect the property
(including the books and records) of the Borrower; (e) shall not be responsible
to any Bank for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, or collateral covered by
any agreement or any other Loan Document and (f) shall incur no liability under
or in respect of this Agreement, the Revolving Credit Notes or any other Loan
Document by acting upon any notice, consent, certificate or other instrument or
writing (which may be by telegram, telecopy, cable or telex) believed by it in
good faith to be genuine and correct and signed or sent by the proper party or
parties.
Neither the Agent nor any of its directors, officers, employees or
agents shall have any responsibility to the Borrower on account of the failure
of or delay in performance or breach by any Bank of any of its obligations
hereunder or to any Bank on account of the failure of or delay in performance or
breach by any other Bank or the Borrower of any of their respective obligations
hereunder or under any Loan Document or in connection herewith or therewith. The
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Banks each hereby acknowledge that the Agent shall be under no duty to take any
discretionary action permitted to be taken by it pursuant to the provisions of
this Agreement, the Revolving Credit Notes or any other Loan Document unless it
shall be requested in writing to do so by the Required Banks or all of the
Banks, as applicable pursuant to Section 0 of this Agreement.
8.11 AGENT'S INDEMNITY. The Banks shall indemnify the Agent, in its
capacity as Agent (to the extent the Agent is not reimbursed by the Borrower)
from and against: (a) any loss or liability (other than any caused by the
Agent's gross negligence or willful misconduct) incurred by the Agent acting in
the capacity as Agent in respect of this Agreement, the Revolving Credit Notes
or any Loan Document and (b) any out-of-pocket costs and expenses incurred in
defending itself or otherwise related to this Agreement, the Revolving Credit
Notes or any Loan Document (other than any caused by the Agent's gross
negligence or willful misconduct) including, without limitation, reasonable fees
and disbursements of legal counsel of its own selection (including, without
limitation, the reasonable interdepartmental charges of its salaried attorneys)
in the defense of any claim against it or in the prosecution and enforcement of
its rights and remedies as the Agent (other than the loss, liability or costs
incurred by the Agent in the defense of any claim against it by the Banks
arising in connection with its actions in its capacity as Agent); provided,
however, that each Bank shall be liable for only its Ratable Portion of the
whole loss or liability. After any Agent's resignation as Agent pursuant to
Section 0 of this Agreement, the provisions of this Section 0 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement.
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8.12 RESIGNATION OF AGENT. The Agent may resign as Agent effective
ten (10) Business Days after giving notice thereof to the Banks for any reason.
If the Agent shall resign as Agent under this Agreement, the Required Banks
shall appoint from among the Banks (other than the Bank that has resigned) a
successor agent for the Banks, which successor agent shall be reasonably
acceptable to the Borrower. In the case of resignation by the Agent, if no
successor agent shall have been appointed by the time such resignation becomes
effective, then the retiring Agent may, on behalf of the Banks, appoint a
successor agent from among the remaining Banks. Upon appointment (whether
effected by the Required Banks or the retiring Agent on behalf of the Banks),
the successor agent shall succeed to the rights, powers and duties of the Agent,
and the term "Agent" shall mean such successor agent, effective upon its
appointment, and the former Agent's rights, powers and duties as Agent shall be
terminated, without any other or further act or deed on the part of such former
Agent or any of the parties to this Agreement or any holder of the Revolving
Credit Notes.
9 TRANSFERS AND ASSIGNMENTS.
9.1 TRANSFER OF COMMITMENTS. Each Bank shall have the right at
any time or times to transfer to another financial institution, without
recourse, all or any part of: such Bank's Revolving Credit Commitment; any Loan
made by such Bank; any Revolving Credit Note executed in favor of such Bank, and
any participations, if any, purchased by the Bank pursuant to Section 0 of this
Agreement; provided, however, in each such case, that the transferor and the
transferee shall have complied with the following requirements:
(a) PRIOR CONSENT. No transfer (other than a transfer by any
Bank to any Affiliate of such Bank) may be consummated pursuant to this
Section 0 in the minimum amount of Five Million Dollars ($5,000,000)
without the prior written consent of the Borrower and the Agent, which
shall not be unreasonably withheld; provided, however, that, (i) the
consent of the Borrower shall not be required in the event a Bank
transfers it's commitment to another Bank and (ii) no Bank shall make
any transfer pursuant to this Section 0 if after giving effect to such
transfer such Bank's Revolving Credit Commitment would be less than
Five Million Dollars ($5,000,000) unless such Bank shall transfer all
if its Revolving Credit Commitment and ceases to be a "Bank" under this
Agreement; provided, further, that, if at the time of the proposed
transfer the Borrower is the subject of a proceeding referenced in
Sections 0 or 0 of this Agreement or an Event of Default has otherwise
occurred which has not been waived by the Required Banks, the
Borrower's consent shall not be required and any Bank may consummate a
transfer contemplated by this Section 0 with the consent of the Agent.
Notwithstanding anything to the contrary, any Bank may at any time (i)
assign all or any portion of its rights under this Agreement and its
Revolving Credit Notes to the Federal Deposit Insurance Corporation or
other similar governmental agency, or (ii) create a security interest
in all or any portion of such rights in favor of any Federal Reserve
Bank, in each case in accordance with Regulation A or the Board of
Governors of the Federal Reserve System,
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and no such assignment or creation shall release such assigning Bank
from its obligations hereunder.
(b) AGREEMENT; TRANSFER FEE. The transferor: (i) shall remit
to the Agent an administrative fee of Three Thousand Dollars ($3,000)
and (ii) shall cause the transferee to execute and deliver to the
Borrower, the Agent and each Bank (A) an Assignment Agreement,
substantially in the form of Exhibit F attached hereto, and otherwise
in form and substance satisfactory to the Agent and its counsel (a
"Bank Assignment Agreement"), together with the consents and releases
referenced therein and (B) such additional amendments, assurances and
other writings as the Agent may reasonably require to effect such
transfer.
(c) REVOLVING CREDIT NOTES. The Borrower shall execute and
deliver to the Agent, the transferor and the transferee, any consent or
release (of all or a portion of the obligations of the transferor) to
be delivered in connection with the Assignment Agreement. If a Bank's
entire interest in its Revolving Credit Commitment and in all of its
Loans have been transferred, the Borrower shall execute and deliver to
the transferee appropriate Revolving Credit Notes against return of the
Revolving Credit Notes (marked "replaced") held by the transferor. If
only a portion of a Bank's interest in its Revolving Credit Commitment
and Loans has been transferred, the Borrower shall execute and deliver
a new Revolving Credit Note to each of the transferor and the
transferee against return of the original such Revolving Credit Notes
of the transferor (marked "replaced") held by the transferor.
(d) PARTIES. Upon satisfaction of the requirements of this
Section 0, including the payment of the fee and the delivery of the
documents set forth in Section 0 above, (i) the transferee shall become
and thereafter be deemed to be a "Bank" for the purposes of this
Agreement and (ii) the transferor (A) shall continue to be a "Bank" for
the purposes of this Agreement only if and to the extent that the
transfer shall not have been a transfer of its entire interest in its
Revolving Credit Commitment and Loans and (B) shall cease to be and
thereafter shall no longer be deemed to be a "Bank" in the case of any
transfer of its entire interest in its Revolving Credit Commitment and
Loans and (iii) the signature pages hereto and Annex A hereto shall be
automatically amended, without further action, to reflect the result of
any such transfer.
9.2 SALE OF PARTICIPATIONS. Each Bank shall have the right at any
time or times to sell one or more participations or subparticipations to a
financial institution in all or any part of: such Bank's Revolving Credit
Commitment; any Loan made by such Bank; any Revolving Credit Note executed in
favor of such Bank, and any participations, if any, purchased by such Bank
pursuant to Section 0 of this Agreement or this Section 0; provided, however, in
each such case, that the transferor and the transferee shall have complied with
the following requirements:
(a) BENEFITS OF PARTICIPANT. The provisions of Section 0 of
this Agreement
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shall inure to the benefit of each purchaser of a participation or
subparticipation (provided that each such participant shall look solely
to the seller of its participation for those benefits and the
Borrower's liabilities, if any, under any of those sections shall not
be increased as a result of the sale of any such participation) and
Agent shall continue to distribute payments pursuant to this Agreement
as if no participation has been sold.
(b) RIGHTS RESERVED. In the event any Bank shall sell any
participation or subparticipation, that Bank shall, as between itself
and the purchaser, retain all of its rights (including, without
limitation, rights to enforce against the Borrower this Agreement and
the Loan Documents) and duties pursuant to this Agreement and the Loan
Documents, including, without limitation, that Bank's right to approve
any waiver, consent or amendment pursuant to Section 0 of this
Agreement, except if and to the extent that any such waiver, consent or
amendment would (A) reduce any fee or commission allocated to the
participation or subparticipation, as the case may be, (B) reduce the
amount of any principal payment on any Loan allocated to the
participation or subparticipation, as the case may be, or reduce the
principal amount of any Loan so allocated or the rate of interest
payable thereon, or (C) extend the time for payment of any amount
allocated to the participation or subparticipation, as the case may be.
(c) NO DELEGATION. No participation or subparticipation shall
operate as a delegation of any duty of the seller thereof. Under no
circumstance shall any participation or subparticipation be deemed a
novation in respect of all or any part of the seller's obligations
pursuant to this Agreement.
9.3 CONFIDENTIALITY. The Agent, the Letter of Credit Bank and each
Bank hereby agrees to use commercially reasonable efforts to keep, and to cause
its agents, attorneys and financial advisors to keep, any information delivered
or made available by the Borrower or any of its Subsidiaries to it confidential
from anyone other than Persons employed or retained by the Agent, the Letter of
Credit Bank or any Bank who are or are expected to become engaged in evaluating,
approving, structuring or administering the Loans; provided that nothing herein
shall prevent the Agent, the Letter of Credit Bank or any Bank from disclosing
such information (a) to any other Bank, (b) to any other person if reasonably
incidental to the administration of the Loans, (c) upon the order of any court
or administrative agency, (d) upon the request or demand of any regulatory
agency or authority, (e) which has been publicly disclosed other than as a
result of a disclosure by the Agent, the Letter of Credit Bank or any other Bank
which is not permitted by this Agreement, (f) in connection with any litigation
to which the Agent, the Letter of Credit or any Bank, or their respective
Affiliates may be a party, (g) to the extent reasonably required in connection
with the exercise of any remedy hereunder, (h) to the Agent's, the Letter of
Credit Bank or such Bank's legal counsel and independent auditors, (i) to any
actual or proposed participant or assignee of all or part of its rights
hereunder so long as such participant or assignee has agreed in writing to be
bound by the terms of this Section 0 and (j) to the extent required by Law.
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10 INDEMNITIES.
10.1 INCREASED COSTS. If, due to either: (a) the introduction of
any Law or regulation, or any change (other than any change by way of imposition
or increase of reserve requirements in respect of LIBOR Rate Loans otherwise
included in the Eurocurrency Reserve Percentage) in or in the interpretation of
any Law or regulation or (b) the compliance with any guideline or request from
any central bank or other governmental authority (whether or not having the
force of Law), there shall be any increase in the cost to any Bank of agreeing
to make or making, funding or maintaining Loans, then the Borrower shall from
time to time, upon demand by such Bank (with a copy of such demand to the
Agent), pay to the Agent for the account of such Bank additional amounts
sufficient to indemnify such Bank for such increased cost.
10.2 RISK-BASED CAPITAL. If any Bank determines that: (a)
compliance with any Law or regulation or any interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof or (b) compliance with any directive, guideline or
request from any central bank or other governmental authority (whether or not
having the force of Law) affects or would affect the amount of capital required
or expected to be maintained by such Bank or any corporation controlling such
Bank and that the amount of such capital required to be so maintained is
increased by or based upon the existence of such Bank's Revolving Credit
Commitment to lend hereunder and other commitments of this type, then, upon
demand by such Bank (with a copy of such demand to the Agent), the Borrower
shall immediately pay to the Agent for the account of such Bank, from time to
time as specified by such Bank, additional amounts sufficient to indemnify such
Bank or such corporation, to the extent that such Bank reasonably determines
such increase in capital to be allocable to the existence of such Bank's
Revolving Credit Commitment to lend hereunder.
10.3 TAXES.
(a) TAXES; WITHHOLDING. Any and all payments by the Borrower
hereunder, under the Revolving Credit Notes or the other Loan Documents
shall be made, in accordance with the provisions of Section 2, free and
clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Bank,
the Letter of Credit Bank and the Agent, taxes imposed on its income,
and franchise taxes imposed on it, by the jurisdiction under the Laws
of which such Bank, the Letter of Credit Bank or the Agent, as the case
may be, is organized or any political subdivision thereof and, in the
case of each Bank, taxes imposed on its income, and franchise taxes
imposed on it, by the jurisdiction of such Bank's Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies,
imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrower shall be required
by Law to deduct any Taxes from or in respect of any sum payable
hereunder or under any Revolving Credit Note to any Bank, the Letter of
Credit Bank or the Agent and makes such deductions from the sums so
payable: (i) the sum payable shall be increased as may
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be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 0)
such Bank, the Letter of Credit Bank or the Agent receives an amount
equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable Law. All
such Taxes shall be paid by the Borrower prior to the date on which
penalties attach thereto or interest accrues thereon; provided,
however, that, if any such penalties or interest become due, the
Borrower shall make prompt payment thereof to the appropriate
governmental authority.
(b) STAMP TAXES. The Borrower agrees to pay, and will
indemnify each Bank, the Letter of Credit Bank or the Agent for, any
present or future stamp or documentary taxes or any other excise or
property taxes, charges or similar levies which arise from any payment
made hereunder, under the Revolving Credit Notes or from the execution,
delivery or registration of, or otherwise with respect to, this
Agreement, the Revolving Credit Notes or the Letters of Credit
(hereinafter referred to as "Other Taxes").
(c) INDEMNIFICATION FOR OTHER TAXES. The Borrower will
indemnify each Bank, the Letter of Credit Bank and the Agent for the
full amount of Taxes or Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed by any jurisdiction on amounts payable
under this Section 0) paid by such Bank, the Letter of Credit Bank or
the Agent and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted. Any
indemnification payment shall be made within thirty (30) days from the
date such Bank, the Letter of Credit Bank or the Agent (as the case may
be) makes written demand therefor.
(d) REQUEST FOR REFUND. At the reasonable request of the
Borrower, each Bank, the Letter of Credit Bank and the Agent shall
apply at the Borrower's expense for a refund in respect of Taxes or
Other Taxes previously paid by the Borrower pursuant to this Section 0
if in the good faith opinion of such Bank, the Letter of Credit Bank or
the Agent there is a reasonable basis for such refund. Notwithstanding
the foregoing, none of the Banks, the Letter of Credit Bank or the
Agent shall be obligated to pursue such refund if, in the exercise of
its good faith judgment, such action would be disadvantageous to it. If
any Bank, the letter of Credit Bank or the Agent subsequently receives
from a taxing authority a refund of any Tax previously paid by the
Borrower and for which the Borrower has indemnified the Bank pursuant
to this Section 0, such Bank, the letter of Credit Bank or the Agent,
as the case may be, shall within thirty (30) days after receipt of such
refund, and to the extent permitted by applicable law, pay to the
Borrower the net amount of any such recovery after deducting taxes and
expenses attributable thereto.
(e) FURNISHING OF CERTIFICATE. Within thirty (30) days after
the date of any payment of Taxes, the Borrower will furnish to the
Agent, at its address referred to in
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Section 0 of this Agreement, the original or a certified copy of a
receipt evidencing payment thereof. If Taxes ever become payable in
respect of any payment hereunder or under the Revolving Credit Notes
made during a Fiscal Quarter, thereafter the Borrower will furnish to
the Agent, within thirty (30) days after the end of such Fiscal
Quarter, at such address, a certificate from the Borrower stating that
any payments made during such Fiscal Quarter are exempt from or not
subject to Taxes.
(f) EXEMPTION CERTIFICATE. Not later than: (a) the Closing
Date, (b) in the case of any bank or financial institution that becomes
a Bank after the Closing Date pursuant to Section 0 of this Agreement,
the date of the instrument of assignment pursuant to which such bank or
financial institution became a Bank, (c) annually on each Anniversary
Date thereafter or (d) such other times as the Agent or the Borrower
may reasonably request: (i) each Bank organized under the laws of a
jurisdiction outside the United States shall provide the Agent and the
Borrower with duly completed copies of Form 1001 or Form 4224 or any
successor form prescribed by the Internal Revenue Service of the United
States certifying that such Bank is exempt from United States
withholding taxes with respect to all payments to be made to such Bank
hereunder or other document satisfactory to the Borrower and the Agent
indicating that all payments to be made to such Bank hereunder are not
subject to such taxes and (ii) each other Bank shall provide the Agent
and the Borrower with a written statement which certifies that such
Bank is not a non-resident alien or foreign corporation and which
otherwise satisfies Treasury Regulation Section 1.1441-5(b) or any
successor regulation under the Internal Revenue Code (each such
certificate or statement, an "Exemption Certificate"). Unless the Agent
and the Borrower have received an Exemption Certificate from such Bank,
the Borrower, or the Agent if the Borrower has not withheld, may
withhold taxes from such payments at the applicable statutory rate
(subject, in the case of the Borrower to the requirements of Section 0
above); provided, however, that, if the Borrower has so withheld, the
Borrower shall so notify the Agent. If the Borrower is required to pay
additional amounts to any Bank pursuant to this Section 0, such Bank
shall use commercially reasonable efforts to designate a different
Lending Office if such designation will thereafter avoid the need for
any additional payments under this Section 0 and will not, in the sole
judgment of such Bank, be otherwise disadvantageous to such Bank. A
Bank which ceases to be exempt from United States withholding taxes
shall notify the Agent and the Borrower promptly thereof. If a Bank
organized under the laws of a jurisdiction other than the United States
or a political subdivision thereof fails to comply with the provisions
of this Subsection (f), then the Borrower shall not have any obligation
to increase the sum payable to such Bank pursuant to this Section 0 or
to indemnify such Bank for Taxes as provided in this Section.
(g) SURVIVAL OF PROVISION. Without prejudice to the survival
of any other agreement of the Borrower hereunder, the agreements and
liabilities of the Borrower contained in this Section 0 shall survive
the payment in full of the Obligations.
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10.4 LOSSES. If any payment of principal of, or Rate Conversion or
Rate Continuation of, any LIBOR Rate Loan is not paid when due or is made on a
day other than on the last day of an Interest Period relating to such Loan, as a
result of a payment or Rate Conversion or Rate Continuation pursuant to the
provisions of Section 0 of this Agreement or acceleration of the maturity of the
Revolving Credit Notes pursuant to Section 0 of this Agreement or for any other
reason, the Borrower shall, upon demand by any Bank (with a copy of such demand
to the Agent), pay to the Agent for the account of such Bank any amounts
required to compensate such Bank for any additional losses, costs or expenses
which it may reasonably incur as a result of such payment or Rate Conversion or
Rate Continuation, including, without limitation, any loss, cost or expense
(other than any expenses directly attributable to loan origination efforts)
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Bank to fund or maintain such Loan.
10.5 INDEMNIFICATION FOR REQUESTS. Whenever the Borrower: (a) shall
revoke any Credit Request, any Rate Conversion/Continuation Request involving
any LIBOR Rate Loan, (b) shall for any other reason fail to borrow pursuant to
any such Request or otherwise comply therewith, (c) shall fail to fulfill, on or
before the date specified in any such request, the applicable conditions set
forth in Section 0 of this Agreement or (d) shall fail to honor any prepayment
notice, then, in each case on any Bank's demand, the Borrower shall indemnify
each Bank and the Agent against any loss, cost or expense incurred by such Bank
or the Agent as a result of any such failure by the Borrower, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Bank or the Agent to
fund the LIBOR Rate Loan to be made by such Bank or the Agent in connection with
such request when such LIBOR Rate Loan, as a result of such failure by the
Borrower, is not made on such date.
10.6 GENERAL INDEMNITY. The Borrower shall indemnify and hold
harmless the Agent, the Letter of Credit Bank, and each Bank, and the respective
directors, officers, employees and Affiliates thereof, from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses and disbursements of any kind or nature whatsoever
including, without limitation, reasonable fees and disbursements of counsel and
settlements costs, which may be imposed on, incurred by, or asserted against the
Agent, the Letter of Credit Bank, or any Bank or the respective directors,
officers, employees and Affiliates thereof in any in connection with any
investigative, administrative or judicial proceeding (whether the Agent or such
Bank is or is not designated as a party thereto) relating to or arising out of
this Agreement or any Loan Document, the transactions contemplated thereby, or
any actual or proposed use of proceeds hereunder or thereunder, except that
neither the Agent, the Letter of Credit Bank, nor any Bank nor any such
directors, officers, employees and Affiliates thereof shall have the right to be
indemnified hereunder for its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction.
10.7 ENVIRONMENTAL INDEMNITY. The Borrower shall, at its sole cost
and expense, indemnify, defend and save harmless the Agent and the Banks (and
each of their respective
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officers, directors, employees, agents, representatives and contractors and any
subsequent owner of the assets of the Borrower who purchases such assets through
the Agent or pursuant to any enforcement action by the Agent) from and against
any and all damages, losses, liabilities, obligations, penalties, claims,
litigations, demands, defenses, judgments, suits, actions, proceedings, costs,
disbursements and\or expenses (including, without limitation, reasonable
attorneys' and experts' fees, expenses and disbursements) of any kind or nature
whatsoever which may at any time be imposed upon, incurred by or asserted
against any of such indemnified Persons relating to, resulting from or arising
out of: (i) Environmental Claims (other than those caused by the wilful
misconduct or gross negligence of the Agent of the Banks), (ii) a material
misrepresentation or inaccuracy in any representation or warranty contained in
this Agreement relating to the Borrower's compliance with Environmental Laws or
(iii) a breach or failure to perform any covenant made by the Borrower in this
Agreement relating to Environmental Laws or Environmental Claims which continues
uncured after the expiration of any applicable grace period. The Borrower will
pay any sums owing to the Agent or the Banks pursuant to this indemnification
obligation ten (10) days after demand by the Agent, together with interest on
such amount accruing from and after the expiration of such period at the default
rate of interest hereunder.
10.8 CERTIFICATE FOR INDEMNIFICATION. Each demand by Agent or a
Bank for payment pursuant to this Section 0 shall be accompanied by a
certificate setting forth the reason for the payment, the amount to be paid, and
the computations and assumptions in determining the amount, which certificate
shall be presumed to be correct. In determining the amount of any such payment
thereunder, each Bank may use reasonable averaging and attribution methods.
10.9 DUTY TO MITIGATE; STANDARD TREATMENT. Each Bank seeking
payment pursuant to this Section 0 shall use reasonable efforts and take all
reasonable actions to avoid the cause of the payment and to minimize the amount
thereof. Each Bank agrees that it will not seek compensation or reimbursement
provided for in this Section 0 unless such Bank as a matter of policy intends
generally to seek comparable compensation or reimbursement from other borrowers
similarly situated and with similarly documented financial accommodations.
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11 GENERAL.
This Agreement and the Loan Documents shall be governed by the
following provisions:
11.1 AMENDMENTS AND WAIVERS. No amendment or waiver of any
provision of this Agreement, the Revolving Credit Notes or any Loan Document,
nor consent to any departure by the Borrower therefrom, nor waiver of any Event
of Default under this Agreement, the Revolving Credit Notes or any Loan
Document, shall in any event be effective unless the same shall be in writing
and signed by the Required Banks (or, if unanimous consent of all Banks is
required as hereinafter provided, all of the Banks), the Agent and the Borrower
and, if relating to the Letter of Credit, the Letter of Credit Bank. Such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given. Unanimous waiver or consent of all Banks shall be
required only with respect to: (a) the waiver of non-payment or extension of
maturity of any Revolving Credit Note, or the payment date of interest,
principal and/or fees thereunder, (b) any reduction in the rate of interest on
the Revolving Credit Notes, or in any amount of principal or interest due on any
Revolving Credit Note, or in the manner of pro rata application of any payments
made by the Borrower to the Banks hereunder, (c) any change in the definition or
calculation of "Required Banks", (d) any change in the dollar amount or
percentage of any Bank's Revolving Credit Commitment, (e) any change in amount
or timing of any fees payable under this Agreement, (f) any waiver of an Event
of Default or Potential Default that would affect the rate of interest or the
amount of fees otherwise payable under this Agreement, (g) any change in any
provision of this Agreement which requires all of the Banks to take any action
under such provision, (h) any amendment to or waiver under any Subsidiary
Guaranty or (i) any change in Section 0, 0, 0 or this Section 0 itself. Notice
of amendments or consents ratified by the Banks hereunder shall immediately be
forwarded by the Borrower to all Banks. Each Bank or other holder of a Revolving
Credit Note shall be bound by any amendment, waiver or consent obtained as
authorized by this section, regardless of its failure to agree thereto.
11.2 CUMULATIVE PROVISIONS; INTEGRATION. Each right, power or
privilege specified or referred to in this Agreement is in addition to and not
in limitation of any other rights, powers and privileges that the Agent, the
Letter of Credit Bank and the Banks may otherwise have or acquire by operation
of Law, by other contract or otherwise. All covenants, conditions, provisions,
warranties, guaranties, indemnities, and other undertakings of the Borrower
contained in this Agreement, each of the Loan Documents, or in any document
referred to in this Agreement or the Loan Document or contained in any agreement
supplementary hereto or thereto, or any schedule or report given to the Agent,
the Letter of Credit Bank or any Bank or contained in any other agreement
between the Agent, the Letter of Credit Bank and the Banks and the Borrower,
whether concurrently or hereafter entered into or delivered, shall be deemed
cumulative to, and not in derogation or substitution of, any of the terms,
covenants, conditions, or agreements of the Borrower contained in this
Agreement.
11.3 BINDING EFFECT. This Agreement shall become effective when it
shall have been
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executed by the Borrower, the Agent, the Letter of Credit Bank and the Banks and
shall be binding upon and inure to the benefit of the Borrower, the Agent, the
Letter of Credit Bank and the Banks and their respective successors and assigns,
except that the Borrower shall not have the right to assign its rights hereunder
or any interest herein without the prior written consent of the Agent, the
Letter of Credit Bank and the Banks. The Banks may, in their sole discretion,
assign, sell, transfer or sell participations or subparticipations subject to
Section 0 of this Agreement.
11.4 COSTS AND EXPENSES. The Borrower agrees to pay on demand all
reasonable costs and expenses of: (a) the Agent, and the Letter of Credit Bank
(including, without limitation, the reasonable fees and out-of-pocket expenses
of counsel for the Agent) in connection with the preparation, execution,
delivery, administration, modification, amendment and waiver of any default of
this Agreement and the Loan Documents and (b) the Agent, the Letter of Credit
Bank and the Banks (including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Agent, the Letter of Credit Bank and
the Banks) in connection with the enforcement of, the exercise of remedies
under, or the preservation of rights and remedies under this Agreement and any
of the Loan Documents (including any collection, bankruptcy or other enforcement
proceedings arising with respect to the Borrower, this Agreement, or any Event
of Default under this Agreement). All amounts due under this Section 0 shall be
payable upon written demand therefor accompanied by a detailed description of
the amount due and the circumstances giving rise to the cost or expense
involved.
11.5 SURVIVAL OF PROVISIONS. All representations and warranties
made in or pursuant to this Agreement shall survive the execution and delivery
of this Agreement and of the Revolving Credit Notes. The provisions of Sections
0, 0.1 through 0 and 0 of this Agreement shall survive the payment of the
Obligations owed by the Borrower hereunder and the termination of this Agreement
(whether by acceleration or otherwise).
11.6 IMMEDIATE U.S. FUNDS. Unless specifically designated
otherwise, any reference to money is a reference to lawful money of the United
States which, if in the form of credits, shall be in immediately available
funds.
11.7 CAPTIONS. The several captions to different Sections and the
respective subsections thereof are inserted for convenience only and shall be
ignored in interpreting the provisions of this Agreement.
11.8 INTEREST RATE LIMITATION. Notwithstanding anything herein to
the contrary, if at any time the applicable interest rate, together with all
fees and charges that are treated as interest under applicable law as provided
for herein or in any other document executed in connection herewith, or
otherwise contracted for, charged, taken, received or reserved by the Agent, the
Letter of Credit Bank or any Bank, shall exceed the maximum lawful rate that may
be contracted for, charged, taken, received or reserved by the Agent, the Letter
of Credit Bank or any Bank in accordance with applicable law, the rate of
interest and all such charges payable, contracted for, charged, taken, received
or reserved in respect of the Obligations of the Borrower hereunder
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84
(including the Loans by the Banks to the Borrower) shall be limited to the
maximum rate permitted by applicable Law.
11.9 ILLEGALITY. If any provision in this Agreement or any other
Loan Document shall for any reason be or become illegal, void or unenforceable,
in whole or in part, that illegality, voidness or unenforceability shall not
affect the remainder of such provision or any other provision of this Agreement
or Loan Document.
11.10 NOTICES. All notices, requests, demands and other
communications provided for hereunder shall be in writing and shall be given
solely: (a) by hand delivery or by overnight courier delivery service, with all
charges paid, (b) by facsimile transmission, if confirmed same day in writing
mailed by first class mail, or (c) by registered or certified mail, postage
prepaid and addressed to the parties. For the purposes of this Agreement, such
notices shall be deemed to be given and received: (i) if by hand or by overnight
courier service, upon actual receipt, (ii) if by facsimile transmission, upon
receipt of machine-generated confirmation of such transmission (and provided the
above-stated written confirmation is sent) or (iii) if by registered or
certified mail, upon actual receipt; provided, however, that requests from the
Borrower to Agent or the Banks pursuant to any of the provisions hereof
including, without limitation, Sections 0 and 0 of this Agreement, shall not be
effective until actually received by the Agent or the Banks, as the case may be.
Notices or other communications hereunder shall be addressed, if to the
Borrower, at the address specified on the signature pages of this Agreement; if
to the Agent or the Letter of Credit Bank, at the address of the Agent specified
on the signature pages of this Agreement, and, if to a Bank, at the address of
such Bank specified on the signature pages of this Agreement.
11.11 GOVERNING LAW. This Agreement and the Loan Documents and the
respective rights and obligations of the parties hereto shall be governed by and
construed in accordance with the internal laws of the State of Ohio (without
giving effect to the conflict of laws rules thereof).
11.12 ENTIRE AGREEMENT. This Agreement, including the exhibits and
schedules thereto, and the Loan Documents constitute the entire contract between
the parties relative to the subject matter hereof. Except for the Agent Letter,
any previous agreement among the parties with respect to the subject matter
hereof is superseded by this Agreement and the Loan Documents. Nothing in this
Agreement or in the Loan Documents, expressed or implied, is intended to confer
upon any party other than the parties hereto and thereto any rights, remedies,
obligations or liabilities under or by reason of this Agreement or the Loan
Documents.
11.13 JURY TRIAL WAIVER. EACH OF THE BORROWER, THE AGENT, THE LETTER
OF CREDIT BANK AND EACH OF THE BANKS WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE
IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG
THE BORROWER, THE AGENT, THE LETTER OF CREDIT BANK AND THE BANKS, OR ANY
THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP
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ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY REVOLVING CREDIT
NOTE OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.
11.14 JURISDICTION; VENUE; INCONVENIENT FORUM.
(a) JURISDICTION. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY,
TO THE NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL
COURT OF THE UNITED STATES OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE REVOLVING CREDIT
NOTES OR ANY LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH OHIO STATE OR, TO
THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES
HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT
ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
(b) VENUE; INCONVENIENT FORUM. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT
MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE REVOLVING CREDIT
NOTES OR ANY OTHER LOAN DOCUMENT IN ANY OHIO STATE OR FEDERAL COURT
SITTING IN OHIO. EACH OF THE PARTIES HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM
TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT. THE
BORROWER CONFIRMS THAT THE FOREGOING WAIVERS ARE INFORMED AND FREELY
MADE.
11.15 EXECUTION IN COUNTERPARTS. This Agreement 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 but one and the same agreement.
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[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers or agents thereunto duly
authorized, as of the date first above written.
OM GROUP, INC.
------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chief Financial Officer
Address for notices:
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
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88
NATIONAL CITY BANK, as Agent and Letter of
Credit Bank
------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
Address for Notices:
National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Metro Group
Telecopy: (000) 000-0000
Payment Office:
National City Bank
National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
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BANKS
ABN AMRO BANK N.V., as Co-Agent and a
Bank
-------------------------------------
Name: Xxx X. Xxxxxxxx
Title: Group Vice President
-------------------------------------
Name: Xxxxx X. XxXxxxxx
Title: Vice President
Address for Notices:
ABN Amro Bank N.V.
Xxx XXX Xxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxx X. Xxxxxxxx
Telecopy: (000) 000-0000
Lending Office:
ABN Amro Bank N.V.
Xxx XXX Xxxxx, Xxxxx 0000
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
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NBD BANK, as a Bank
----------------------------
Name: Xxxx X. XxXxxx
Title: Vice President
Address for Notices:
NBD Bank
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. XxXxxx
Telecopy: (000)000-0000
Lending Office:
NBD Bank
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
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XXXXXX TRUST AND SAVINGS BANK, as a
Bank
-----------------------------------
Name: Xxxxxxx X. XxXxxxxxx
Title: Vice President
Address for Notices:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
XX Xxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. XxXxxxxxx
Telecopy: (000)000-0000
Lending Office:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
XX Xxx 000
Xxxxxxx, Xxxxxxxx 00000
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KEYBANK NATIONAL ASSOCIATION, as a
Bank
----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
Address for Notices:
KeyBank National Association
000 Xxxxxx Xxxxxx
XX-00-00-0000
0xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopy: (000) 000-0000
Lending Office:
KeyBank National Association
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
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MELLON BANK, N.A., as a Bank
-----------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
Address for Notices:
Mellon Bank, N.A.
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxx X. Xxxxx
Telecopy: (000) 000-0000
Lending Office:
Mellon Bank, N.A.
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxx 00000
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NATIONAL CITY BANK, as a Bank
-----------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
Address for Notices:
National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Metro Group
Telecopy: (000) 000-0000
Lending Office:
National City Center
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
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95
ANNEX I
COMMITMENTS
Credit Agreement, dated as of January 30, 1998,
among OM Group, Inc., the Agent, the Co-Agent,
the Letter of Credit Bank and the Banks
================================================================================
Revolving
Credit
Bank Commitment
================================================================================
National City Bank $ 63,750,000 25.50%
================================================================================
ABN Amro Bank N.V. $ 60,000,000 24.00%
================================================================================
KeyBank National Association $ 38,125,000 15.25%
================================================================================
Mellon Bank, N.A. $ 38,125,000 15.25%
================================================================================
Xxxxxx Trust and Savings Bank $ 25,000,000 10.00%
================================================================================
NBD Bank $ 25,000,000 10.00%
================================================================================
Aggregate Bank Commitments $250,000,000.00 100.00%
================================================================================
Annex I - 1
96
Annex II
SUPPLEMENTAL SCHEDULE
Credit Agreement, dated as of January 30, 1998,
among OM Group, Inc., the Agent, the Co-Agent,
the Letter of Credit Bank and the Banks
Annex II - 1
97
EXECUTION COPY
REVOLVING CREDIT NOTE
$25,000,000 Dated: January 30, 1998
FOR VALUE RECEIVED, the undersigned, OM Group, Inc, a Delaware
corporation ("Borrower"), hereby promises to pay to the order of NBD Bank
[Xxxxxx Bank and Trust Company] (the "Bank"), in immediately available funds on
the Revolving Credit Termination Date, the lesser of [________________________]
Dollars ($25,000,000) or the aggregate outstanding principal amount of the
Revolving Credit Loans made by the Bank to the Borrower pursuant to the Credit
Agreement (as hereinafter defined). Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to such term in that
certain Credit Agreement, dated as of January 30, 1998 (as the same may from
time to time be amended, supplemented, restated or otherwise modified, the
"Credit Agreement"), among the Borrower, the banks which are signatories thereto
(the "Banks"), ABN Amro Bank N.V., as Co-Agent, National City Bank, as Letter of
Credit Banks ("Letter of Credit Banks"), and National City Bank, as Agent for
the Banks, the Co-Agent and the Letter of Credit Bank ("Agent").
The Borrower promises to pay interest on the unpaid principal
amount of each Revolving Credit Loan evidenced hereby from the date of such
Revolving Credit Loan until such principal amount is paid in full, at such
interest rates, and payable at such times, as are specified in the Credit
Agreement. The Borrower promises to pay on demand interest on any overdue
principal and, to the extent permitted by law, overdue interest from their due
dates at the rate or rates provided in the Credit Agreement.
Both principal and interest in respect of each Revolving
Credit Loan are payable in lawful money of the United States of America to the
Agent at the Payment Office of the Agent in same day funds. Each Revolving
Credit Loan made by the Bank to the Borrower pursuant to the Credit Agreement,
and all payments made on account of the principal amount thereof, shall be
recorded by the Agent and the Bank on its books and records and, prior to any
transfer hereof, endorsed on the grid attached hereto which is a part of this
Revolving Credit Note; provided, however, that the failure of the holder hereof
to make such a notation or any error in such a notation shall not affect the
obligations of the Borrower under this Revolving Credit Note.
This Revolving Credit Note is one of the Notes referred to in,
and is entitled to the benefits of, the Credit Agreement. The Credit Agreement,
among other things, (i) provides for the making of Revolving Credit Loans by the
Bank to the Borrower from time to time in an aggregate amount not to exceed at
any time outstanding the Bank's Revolving Credit Commitment, the indebtedness of
the Borrower resulting from each such Revolving Credit Loan being evidenced by
this Revolving Credit Note, (ii) contains provisions for acceleration of the
98
maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof and
(iii) provides for the amendment or waiver of certain terms of the Credit
Agreement, all upon the terms and conditions therein specified.
The Borrower hereby waives diligence, presentment, demand,
protest and notice of any kind whatsoever. The nonexercise by the holder of any
of its rights hereunder in any particular instance shall not constitute a waiver
thereof in that or any subsequent instance. This Revolving Credit Note shall be
binding upon the undersigned and its successors and assigns, and shall inure to
the benefit of the Bank, its successors and assigns and all subsequent holders
of this Note.
THIS REVOLVING CREDIT NOTE HAS BEEN MADE AND EXECUTED IN
CLEVELAND, CUYAHOGA COUNTY, OHIO, AND SHALL BE CONSTRUED ACCORDING TO THE LAWS
OF THE STATE OF OHIO WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAW. IF ANY
PROVISION HEREOF IS IN CONFLICT WITH ANY STATUTE OR RULE OF LAW OF THE STATE OF
OHIO OR IS OTHERWISE UNENFORCEABLE FOR ANY REASON WHATSOEVER, THEN SUCH
PROVISION SHALL BE DEEMED SEPARABLE FROM AND SHALL NOT INVALIDATE ANY OTHER
PROVISION OF THIS NOTE.
OM GROUP, INC. ("BORROWER")
--------------------------------
By: Xxxxx X. Xxxxxxx
Title: Chief Financial Officer
2
99
LOANS AND PAYMENTS OF PRINCIPAL
CREDIT AGREEMENT,
DATED AS OF January 30, 1998
==========================================================================================================================
Date of $ Amount Date Paid Principal Amount Paid Principal Amount Noted by
Loan Outstanding
==========================================================================================================================
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==========================================================================================================================
3
100
EXHIBIT B
FORM OF
CREDIT REQUEST
From: OM Group, Inc. (the "Borrower")
To: National City Bank, as Agent
Date: __________________, 199___
Subject: Amended and Restated Credit Agreement, dated as of January 30,
1998 (as amended from time to time, the "Credit Agreement"),
among the Borrower, the banks which are signatories thereto
(the "Banks"), ABN Amro Bank N.V., as Co-Agent, National City
Bank, as Letter of Credit Bank ("Letter of Credit Banks"), and
National City Bank, as Agent for the Banks, the Co-Agent and
the Letter of Credit Bank ("Agent")
Greetings:
Each capitalized term in this Credit Request shall be defined in
accordance with the Credit Agreement. Pursuant to the Credit Agreement, we
request:
( ) the Banks to grant us an Alternate Base Rate Borrowing in the
aggregate principal sum of $_______________, to be made available on
the _____________ day of ____________________, 199____.
( ) the Banks to grant us a LIBOR Rate Borrowing in the aggregate
principal sum of $_______________, to be made available on the ________
day of ________________, 199___, and to have an initial Interest Period
of _______________.
( ) a Letter of Credit Bank to issue a [Standby Letter of Credit]
[Trade Letter of Credit], dated as of _______________, 199___, for the
account of the Borrower and to and for the benefit of
__________________________________, as beneficiary, for an aggregate
face amount of [$_______________]; and in connection therewith we
enclose a more detailed application and a Reimbursement Agreement.
101
and, in the case of any requested Borrowing or Letter of Credit issuance, to
disburse the proceeds thereof, or issue such Letter of Credit, as follows:
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________________________________.
The undersigned hereby certifies that conditions set forth in Section
3.2 of the Credit Agreement are satisfied on the date hereof, and will be
satisfied on the date of the Rate Conversion or Rate Continuation, as the case
may be, before and after giving effect thereto and to the application of the
proceeds therefrom.
Very truly yours,
OM GROUP, INC.,
as Borrower
_____________________________
By: ____________________
Its: ____________________
-2-
102
EXHIBIT C
FORM OF
RATE CONVERSION/CONTINUATION REQUEST
From: OM Group, Inc. (the "Borrower")
To: National City Bank, as Agent
Date: __________________, 199___
Subject: Amended and Restated Credit Agreement, dated as of January 30,
1998 (as amended from time to time, the "Credit Agreement"),
among the Borrower, the banks which are signatories thereto
(the "Banks"), ABN Amro Bank N.V., as Co-Agent, National City
Bank, as Letter of Credit Bank ("Letter of Credit Banks"), and
National City Bank, as Agent for the Banks, the Co-Agent and
the Letter of Credit Bank ("Agent")
Greetings:
Each capitalized term used in this Rate
Conversion/Continuation Request shall have the meaning ascribed to such term in
the Credit Agreement. Pursuant to the Credit Agreement, the Borrower requests:
( ) the Banks to convert $_________________ principal amount of the
[LIBOR Rate Loans] [Alternate Base Rate Loans] comprising the Revolving
Credit Borrowing (or portion thereof) [made] [converted] [continued] on
_____________, 199_ in the original aggregate principal sum of
$___________________, on _________________, 199_, into [LIBOR Rate
Loans to have an Interest Period of ___ months from the date thereof
commencing on _________________, 199_.] [Alternate Base Rate Loans.]
( ) the Banks to continue $_________________ principal amount of the
LIBOR Rate Loans comprising the Revolving Credit Borrowing (or portion
thereof) [made] [converted] [continued] on _____________, 199_ with a
___ month Interest Period in the original aggregate principal sum of
$___________________ as LIBOR Rate Loans having an Interest Period of
the same duration commencing on _________________, 199_.
( ) the Banks to convert $__________________ principal amount of the
LIBOR Rate Loans comprising the Revolving Credit Borrowing (or portion
thereof) [made][converted] [continued] on _____________, 199__ with a
____ month Interest Period in the original aggregate principal sum of
[$______________] to LIBOR Rate Loans having an Interest
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Period of ____ months commencing on ________________, 199__.(1)
The undersigned represents and warrants that this request is made in
compliance with Section 2.7 of the Credit Agreement.
The undersigned hereby certifies that conditions set forth in Section
3.2 of the Credit Agreement are satisfied on the date hereof, and will be
satisfied on the date of the Rate Conversion or Rate Continuation, as the case
may be, before and after giving effect thereto and to the application of the
proceeds therefrom.
Very truly yours,
OM GROUP, INC.,
as Borrower
_________________________________
By: _____________________________
Its: ____________________________
Contact Phone: (_____) ______________
Contact Fax: (_____) ______________
--------
(1) In the event that Borrower desires to request more than one rate conversion
or rate continuation on the same day, the Borrower may deliver more than one
Rate Conversion/Continuation Request (subject to the limitations of Section
2.11).
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EXHIBIT D
FORM OF
SUBSIDIARY GUARANTY AGREEMENT
This GUARANTY AGREEMENT (this "Guaranty Agreement") is made as
of the _____ day of _____________, 1998, by [ ___________________], a
__________________ corporation (the "Guarantor"), in favor of National City
Bank, as Agent (the "Agent"), for the benefit of the Banks (as defined below),
the Co-Agent (as defined below) and the Letter of Credit Bank (as defined
below).
RECITALS
WHEREAS, the Agent, OM Group, Inc. (the "Borrower"), the banks
which are party thereto (the "Banks"), ABN Amro Bank, N.V., as Co-Agent (the
"Co-Agent") and National City Bank, as Letter of Credit Bank (the "Letter of
Credit Bank"), will enter into that certain Amended and Restated Credit
Agreement (as the same may from time to time be amended or otherwise modified or
supplemented, the "Credit Agreement"), pursuant to which the Banks will make
certain loans and other financial accommodations available to the Borrower;
WHEREAS, the Guarantor is a wholly-owned subsidiary of the
Borrower and therefore will benefit from the loans and financial accommodations
made available to the Borrower; and
WHEREAS, it is a condition precedent to the Banks' making of
financial accommodations available to the Borrower and the Letter of Credit
Bank's issuing of letters of credit under the Credit Agreement that the
Guarantor shall have executed and delivered this Guaranty Agreement;
NOW, THEREFORE, in consideration of these premises and in
order to induce the Banks to make loans and other financial accommodations
available to the Borrower under the Credit Agreement, the Guarantor hereby
agrees with the Agent, for the benefit of the Banks, the Co-Agent and the Letter
of Credit Bank as follows:
SECTION 1. Definitions. The capitalized terms used herein
which are defined in the Credit Agreement and not otherwise defined herein are
used herein as therein defined.
SECTION 2. Guaranty. The Guarantor hereby unconditionally
guarantees the punctual payment when due, whether at stated maturity, by
acceleration or otherwise, of all obligations the Borrower may now or hereafter
owe to the Agent, the Banks or the Letter of Credit Bank, of every type and
description, including, but not limited to, the Borrower's
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obligations under the Credit Agreement and the Loan Documents (all such
obligations of the Borrower being referred to herein as of the "Guaranteed
Obligations") and agrees to pay any and all expenses (including counsel fees and
expenses) incurred by the Agent, the Banks or the Letter of Credit Bank in
enforcing any rights under this Guaranty Agreement.
SECTION 3. Maximum Liability. The maximum liability of the
Guarantor under this Guaranty Agreement shall be the greatest amount which,
after taking into consideration all other valid and enforceable debts and
liabilities of the Guarantor, an applicable court has determined (after any
appeals) would not render the Guarantor insolvent, unable to pay its debts as
they become due, inadequately capitalized for the business which it intends to
conduct, or unable to pay a judgment rendered upon a claim that is the subject
of an action or proceeding pending at the time when the obligations of this
Guaranty Agreement are incurred or increased.
SECTION 4. Guaranty Absolute. The Guarantor guarantees that
the Guaranteed Obligations will be paid strictly in accordance with the terms of
the Credit Agreement and the Loan Documents, regardless of any law, regulation
or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Agent or the Banks with respect thereto. The
liability of the Guarantor under this Guaranty Agreement shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit
Agreement, the Loan Documents or any other agreement or instrument
relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from the
Credit Agreement, the Loan Documents or any other agreement or
instrument relating thereto;
(c) any exchange, release or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from
any other guaranty, for all or any of the Guaranteed Obligations;
(d) failure by the Agent or any Bank to take any steps to
perfect and maintain its or their security interest in, or preserve its
rights to, any security or collateral for the Guaranteed Obligations;
(e) the Agent's or any Bank's election in any proceeding
instituted under Chapter 11 of Title 11 of the United States Code (11
U.S.C. Section 101 et seq.) (the "Bankruptcy Code"), or the application
of Section 1111(b)(2) of the Bankruptcy Code;
(f) any borrowing or grant of a security interest under
Section 364 of the Bankruptcy Code; or
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(g) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrower or any guarantor.
This Guaranty Agreement shall continue to be effective or shall be reinstated,
as the case may be, if at any time any payment of any of the Guaranteed
Obligations is rescinded or must otherwise be returned by the Agent, any Bank or
the Letter of Credit Bank upon the insolvency, bankruptcy or reorganization of
the Borrower or otherwise, all as though such payment had not been made.
SECTION 5. Waiver. The Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Guaranty and any requirement that the Agent, any
Bank or the Letter of Credit Bank protect, secure, perfect or insure any
security interest or lien or any property subject thereto or exhaust any right
or take any action against the Borrower or any other person or entity or any
collateral.
SECTION 6. Subrogation. The Guarantor shall have no right of
subrogation, reimbursement or contribution and hereby waives any right to
enforce any remedy which the Agent, any Bank or the Letter of Credit Bank now
has or may hereafter have against the Borrower, any endorser or any other
guarantor, of all or any part of the Guaranteed Obligations, and the Guarantor
hereby waives any benefit of, and any right to participate in, any security or
collateral given to the Agent to secure payment of the Guaranteed Obligations or
any other liability of the Borrower to the Agent, the Banks or the Letter of
Credit Bank. The Guarantor also waives all setoffs and counterclaims and all
presentments, demands for performance, notices of nonperformance, protests,
notices of protest, notices of dishonor, and notices of acceptance of this
Guaranty Agreement . The Guarantor further waives all notices of the existence,
creation or incurring of new or additional indebtedness, arising either from
additional loans extended to the Borrower or otherwise, and also waives all
notices that the principal amount, or any portion thereof, and/or any interest
on any instrument or document evidencing all or any part of the Guaranteed
Obligations is due, notices of any and all proceedings to collect from the
maker, any endorser or any other guarantor of all or any part of the Guaranteed
Obligations, or from anyone else, and, to the extent permitted by law, notices
of exchange, sale, surrender or other handling of any security or other
collateral given to the Agent or any Bank to secure payment of the Guaranteed
Obligations.
SECTION 7. Financial Condition of Borrower. The Guarantor
hereby assumes responsibility for keeping itself informed of the financial
condition of the Borrower and of all circumstances bearing upon the risk of
nonpayment of the Guaranteed Obligations or any part thereof that diligent
inquiry would reveal and the Guarantor hereby agrees that neither the Agent nor
any Bank shall have any duty to advise the Guarantor of information known to the
Agent or any such Bank regarding such condition or any such circumstances. In
the event the Agent or any Bank, in its sole discretion, undertakes at any time
or from time to time to provide any such information to the Guarantor, neither
the Agent or such Bank shall be under any obligation (i) to undertake any
investigation not a part of its regular business routine (ii) to disclose any
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information which, pursuant to accepted or reasonable commercial finance
practices, the Agent or such Bank wishes to maintain confidential or (iii) to
make any other or future disclosures of such information or any other
information to the Guarantor.
SECTION 8. Marshalling of Assets. The Guarantor consents and
agrees that the Agent, the Banks and the Letter of Credit Bank shall not be
under any obligation to xxxxxxxx any assets in favor of the Guarantor or against
or in payment of any or all of the Guaranteed Obligations. The Guarantor further
agrees that, to the extent that the Borrower makes a payment or payments to the
Agent, any Bank or the Letter of Credit Bank, or the Agent, any Bank or the
Letter of Credit Bank receives any proceeds of collateral, which payment or
payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to Borrower,
its estate, trustee, receiver or any other party, including, without limitation,
the Guarantor, under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such payment or repayment, the Guaranteed
Obligations or part thereof which has been paid, reduced or satisfied by such
amount shall be reinstated and continued in full force and effect as of the date
such initial payment, reduction or satisfaction occurred.
SECTION 9. Representations and Warranties; Incumbency.
(a) The Guarantor hereby represents and warrants that (i) the
Guarantor is a corporation duly organized and existing in good standing and has
full power and authority to make and deliver this Guaranty Agreement; (ii) the
execution, delivery and performance of this Guaranty Agreement by the Guarantor
have been duly authorized by all necessary action of its directors and
shareholders and do not and will not violate the provisions of, or constitute a
default under, any presently applicable law or its Certificate of Incorporation
or By-Laws or any agreement presently binding on it; (iii) this Guaranty
Agreement has been duly executed and delivered by the authorized officers of the
Guarantor and constitutes its lawful, binding and legally enforceable obligation
(subject to the United States Bankruptcy Code and other similar laws generally
affecting the enforcement of creditors' rights); (iv) the authorization,
execution, delivery and performance of this Guaranty Agreement do not require
notification to, registration with, or consent or approval by, any federal,
state or local regulatory body or administrative agency; and (v) there are no
actions, suits or proceedings pending or threatened against or affecting the
Guarantor, or any of its properties, before any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, that, if adversely determined, may (A) call into question the legality,
validity or enforceability of this Guaranty Agreement or any Loan Document, or
(B) have a material adverse effect on the condition, financial or otherwise,
operations, properties or prospects of the Guarantor.
(b) The Guarantor shall deliver to the Agent, concurrently
with the execution of this Guaranty Agreement, (i) a certificate executed by an
authorized officer of the Guarantor certifying (A) the resolutions of the Board
of Directors of the Guarantor authorizing the execution, performance and
delivery of this Guaranty Agreement and the other Loan Documents
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to which the Guarantor is a party, (B) the names and signatures of the officers
of the Guarantor executing or attesting to this Guaranty Agreement and such
other Loan Documents, and (C) as true, correct, complete and in full force and
effect, without amendment or revocation as of the date hereof, the Guarantor's
Certificate of Incorporation and By-Laws and (ii) a good standing certificate
for the Guarantor issued by the Secretary of State of the state of its
incorporation.
SECTION 10. Negative Covenants. The Guarantor covenants and agrees
that, so long as any part of the Guaranteed Obligations shall remain unpaid or
the Revolving Credit Commitment remains outstanding, the Guarantor will not,
without the prior written consent of the Agent, for the benefit of the Banks:
(a) Liens, Etc. Except as permitted by the Credit Agreement,
create or suffer to exist any lien, security interest or other charge
or encumbrance, upon or with respect to any of its properties, whether
now owned or hereafter acquired, or assign any right to receive income,
in each case to secure any Indebtedness of any Person.
(b) Sales, Etc. of Assets. Except as permitted by the Credit
Agreement, sell, lease, transfer or otherwise dispose of any of its
assets.
(c) Change in Nature of Business. Make any material change in
the nature of its business as carried on at the date of this Guaranty
Agreement.
SECTION 11. Authorization. The Agent, on behalf of the Banks
and the Letter of Credit Bank, is hereby authorized, without notice or demand
and without affecting the liability of the Guarantor hereunder, from time to
time, to (i) renew, extend, accelerate or otherwise change the time for payment
of, or other terms relating to, the Guaranteed Obligations, or otherwise modify,
amend or change the terms of the Credit Agreement, the Loan Documents, or any
other promissory note or other agreement, document or instrument now or
hereafter executed by the Borrower and delivered to the Agent, any Bank or the
Letter of Credit Bank; (ii) accept partial payments on the Guaranteed
Obligations; (iii) take and hold security or collateral for the payment of this
Guaranty Agreement, any other guarantees of the Guaranteed Obligations or other
liabilities of the Borrower and the Guaranteed Obligations guaranteed hereby or
thereby, and exchange, enforce, waive and release any such security or
collateral; (iv) apply such security or collateral and direct the order or
manner of sale thereof as in its discretion it may determine; and (v) settle,
release, compromise, collect or otherwise liquidate the Guaranteed Obligations
and any security or collateral therefor in any manner, without affecting or
impairing the obligations of the Guarantor hereunder.
At any time upon the occurrence and during the continuation of
an Event of Default, the Agent, any Bank or the Letter of Credit Bank may, in
its sole discretion, without notice to the Guarantor and regardless of the
acceptance of any security or collateral for the payment hereof, appropriate and
apply toward the payment of the Guaranteed Obligations (i) any indebtedness due
or to become due from the Agent, any Bank or the Letter of Credit Bank to the
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Guarantor, and (ii) any moneys, credits or other property belonging to the
Guarantor, at any time held by or coming into the possession of the Agent, any
Bank or the Letter of Credit Bank.
SECTION 12. Amendments, Etc. No amendment or waiver of any
provisions of this Guaranty Agreement nor consent to any departure by the
Guarantor therefrom shall in any event be effective unless the same shall be in
writing and signed by the Agent and all of the Banks, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No release or termination of this Guaranty Agreement
shall be effected unless the same shall be in writing and executed by the Agent.
SECTION 13. No Waiver; Remedies. No failure on the part of the
Agent or any Bank or the Letter of Credit Bank to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 14. Right of Set-off. Upon the occurrence and during
the continuance of any Event of Default, the Agent, each Bank and the Letter of
Credit Bank 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 the Agent, such Bank or the Letter of
Credit Bank to or for the credit or the account of the Guarantor against any and
all of the obligations of the Guarantor now or hereafter existing under this
Guaranty Agreement, irrespective of whether or not the Agent, such Bank or the
Letter of Credit Bank shall have made any demand under this Guaranty Agreement
and although such obligations may be contingent and unmatured. The Agent, each
such Bank and the Letter of Credit Bank agrees promptly to notify the Guarantor
after any such set-off and application made by the Agent, such Bank or the
Letter of Credit Bank, as the case may be, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of the Agent, each Bank and the Letter of Credit Bank under this Section
14 are in addition to other rights and remedies (including, without limitation,
other rights of set-off) which the Agent, such Bank or the Letter of Credit Bank
may have.
SECTION 15. Continuing Guaranty; Transfer of Advances. This
Guaranty Agreement is a continuing guaranty and shall (i) remain in full force
and effect until the Guaranteed Obligations are paid in full and each Bank's
Revolving Credit Commitment is terminated, and shall continue in effect
thereafter until this Guaranty Agreement is revoked prospectively as to future
transactions by written notice to that effect actually received by the Agent
(but such notice shall not be effective as to any Guaranteed Obligations or the
Revolving Credit Commitment outstanding at that time, any additional interest,
premiums or fees to become payable with respect thereto or any renewals,
extensions, or refinancings of the same), (ii) be binding upon the Guarantor,
its successors and assigns, and (iii) inure to the benefit of and be enforceable
by the Agent and its successors, transferees and assigns. Without limiting the
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generality of the foregoing clause (iii), subject to the limitations, if any,
set forth in the Credit Agreement, the Agent and each Bank may assign or
otherwise transfer any portion of the Advances held by it to any other person or
entity, and such other person or entity shall thereupon become vested with all
the rights in respect thereof granted to the Agent herein or otherwise.
SECTION 16. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including telecopy,
telegraphic, telex or cable communication) and mailed, telecopied, telegraphed,
telexed, cabled or delivered, if to the Guarantor, at its address shown below
its signature hereto; and if to the Agent, at its address specified in the
Credit Agreement, or as to each party at such other address as shall be
designated by such party in a written notice to the other party. All such
notices and other communications shall, when mailed, telecopied, telegraphed,
telexed or cabled, be effective five (5) Business Days after deposit in the
mails, and on the date telecopied, delivered to the telegraph company, confirmed
by telex answerback or delivered to the cable company, respectively.
SECTION 17. Solvency. The Guarantor is solvent (as described
in the Guarantor Credit Agreement). The Guarantor does not believe that final
judgments, if any, against the Guarantor in actions for money damages presently
pending will be rendered at a time when, or in an amount such that, the
Guarantor will be unable to satisfy any such judgments promptly in accordance
with their terms (taking into account the maximum reasonable amount of such
judgments in any such actions and the earliest reasonable time at which such
judgments might be rendered). The cash flow of the Guarantor, after taking into
account all other anticipated uses of the cash of the Guarantor (including the
payments on or in respect of debt referred to in this Section 17), will at all
times be sufficient to pay all such judgments promptly in accordance with their
terms.
SECTION 18. Waiver of Jury Trial. THE PARTIES ACKNOWLEDGE AND
AGREE THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS GUARANTY AGREEMENT, THE
CREDIT AGREEMENT OR THE LOAN DOCUMENTS (AS DEFINED IN THE CREDIT AGREEMENT)
WOULD INVOLVE DIFFICULT AND COMPLEX ISSUES AND THEREFORE AGREE THAT ANY LAWSUIT
GROWING OUT OF OR INCIDENTAL TO ANY SUCH CONTROVERSY WILL BE TRIED IN A COURT OF
COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
SECTION 19. Jurisdiction; Venue; Inconvenient Forum.
(a) Jurisdiction. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF ANY OHIO STATE COURT OR FEDERAL COURT OF THE UNITED
STATES OF AMERICA SITTING IN CUYAHOGA COUNTY, OHIO, AND ANY APPELLATE COURT FROM
ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
GUARANTY AGREEMENT, THE CREDIT AGREEMENT OR THE LOAN DOCUMENTS,
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OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH OHIO
STATE OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE
PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING
SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
(b) Venue; Inconvenient Forum. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY
LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS GUARANTY AGREEMENT, THE CREDIT AGREEMENT OR ANY LOAN DOCUMENT
IN ANY OHIO STATE OR FEDERAL COURT SITTING IN CUYAHOGA COUNTY, OHIO. EACH OF THE
PARTIES HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE
DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING
IN ANY SUCH COURT. THE GUARANTOR CONFIRMS THAT THE FOREGOING WAIVERS ARE
INFORMED AND FREELY MADE.
SECTION 20. Governing Law. This Guaranty shall be governed by,
and construed in accordance with, the laws of the State of Ohio.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty
Agreement to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written.
[____________________________],
("GUARANTOR")
____________________________________________
By: ________________________________________
Its:________________________________________
Address for Notices:
____________________________________________
____________________________________________
____________________________________________
Accepted and Agreed to by:
NATIONAL CITY BANK, as Agent
____________________________________
By: Xxxxxxx X. Xxxxx
Its: Vice President
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EXHIBIT F
FORM OF
BANK ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement")
between _____________________________________________________________________
(the "Assignor") and ________________________________________ (the "Assignee")
is dated as of ________________, 19___. The parties hereto agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to an
Amended and Restated Credit Agreement, dated as of January 30, 1998 (which, as
it may be amended, modified, renewed or extended from time to time, is herein
called the "Credit Agreement"), among OM Group, Inc. (the "Borrower"), the banks
which are signatories thereto (the "Banks"), ABN Amro Bank N.V., as Co-Agent
(the "Co-Agent"), National City Bank as Letter of Credit Bank (the "Letter of
Credit Bank"), and National City Bank as agent for the Banks and the Letter of
Credit Bank (the "Agent"). Capitalized terms used herein and not otherwise
defined herein shall have the meanings attributed to them in the Credit
Agreement. The Assignor desires to assign to the Assignee, and the Assignee
desires to assume from the Assignor, an undivided interest (the "Purchased
Percentage") in the Revolving Credit Commitment of the Assignor such that after
giving effect to the assignment and assumption hereinafter provided, the
Revolving Credit Commitment of the Assignee shall equal ________________________
Dollars ($___________) and its percentage of the aggregate amount of the
Revolving Credit Commitments shall equal ________________________ percent
(____%).
2. ASSIGNMENT. For and in consideration of the assumption of
obligations by the Assignee set forth in Section 3 hereof and the other
consideration set forth herein, and effective as of the Effective Date (as
hereinafter defined), the Assignor does hereby sell, assign, transfer and convey
all of its right, title and interest in and to the Purchased Percentage of (i)
the Revolving Credit Commitment of the Assignor (as in effect on the Effective
Date), (ii) any Revolving Credit Loan made by the Assignor which is outstanding
on the Effective Date, (iii) the Assignor's Ratable Portion of each Letter of
Credit, (iv) any Note delivered to the Assignor pursuant to the Credit
Agreement, and (v) the Credit Agreement and the other Loan Documents. Pursuant
to Section 9.1(d) of the Credit Agreement, on and after the Effective Date the
Assignee shall have the same rights, benefits and obligations as the Assignor
had under the Loan Documents with respect to the Purchased Percentage of the
Loan Documents, all determined as if the Assignee were a "Bank" under the Credit
Agreement with ____________________ Dollars ($_____________) equaling
_____________ percent (_____%) of the aggregate amount of the Revolving Credit
Commitments. The Effective Date (the "Effective Date") shall be two Business
Days (or such shorter period agreed to by the Agent) after a Notice of
Assignment substantially in the form of Attachment I hereto and any consents
substantially in the form of Attachment II hereto required to be delivered to
the Agent by Section 9.1(b) of the Credit Agreement have been delivered to the
Agent; provided, however, that, in the event that the Borrower shall
appropriately deliver a Credit Request prior to the time at which all of
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to the effectiveness of this Assignment shall have been met, the Effective Date
shall be the Business Day immediately following the day upon which the Advances
by the Bank are to be made under such Credit Request. In no event will the
Effective Date occur if the payments required to be made by the Assignee to the
Assignor on the Effective Date under Section 4 are not made on or prior to the
proposed Effective Date. The Assignor will notify the Assignee of the proposed
Effective Date on the Business Day prior to the proposed Effective Date and will
notify the Assignee of any pending Credit Request which would delay such
proposed Effective Date.
3. ASSUMPTION. For and in consideration of the assignment of
rights by the Assignor set forth in Section 2 hereof and the other consideration
set forth herein, and effective as of the Effective Date, the Assignee does
hereby accept that assignment, and assume and covenant and agree fully,
completely and timely to perform, comply with and discharge, each and all of the
obligations, duties and liabilities of the Assignor under the Credit Agreement
which are assigned to the Assignee hereunder, which assumption includes, without
limitation, the obligation to fund the unfunded portion of the aggregate amount
of the Revolving Credit Commitments in accordance with the provisions set forth
in the Credit Agreement and to participate in the Letters of Credit pursuant to
its Ratable Portion thereof as if the Assignee were a "Bank" under the Credit
Agreement with ______________________ Dollars ($_______________) equaling
____________ percent (______%) of the aggregate amount of the Revolving Credit
Commitments. The Assignee agrees to be bound by all provisions relating to
"Bank" under and as defined in the Credit Agreement, including, without
limitation, provisions relating to the dissemination of information and the
payment of indemnification.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the
Assignee shall be entitled to receive from the Agent all payments of principal,
interest and fees with respect to the Purchased Percentage of the Assignor's
Revolving Credit Commitment, Advances and reimbursement with respect to Letters
of Credit. The Assignee shall advance funds directly to the Agent with respect
to all Advances and reimbursement payments made on or after the Effective Date.
In consideration for the sale and assignment of Advances hereunder the Assignee
shall pay the Assignor, on the Effective Date, an amount in Dollars equal to the
Purchased Percentage of all such Advances. On and after the Effective Date, the
Assignee will also remit to the Assignor any amounts of interest on Advances and
fees received from the Agent which relate to the Purchased Percentage of
Advances made by the Assignor accrued for periods prior to the Effective Date
and not heretofore paid by the Assignee to the Assignor. In the event that
either party hereto receives any payment to which the other party hereto is
entitled under this Assignment Agreement, then the party receiving such amount
shall promptly remit it to the other party hereto.
5. CONFIDENTIALITY. By executing and delivering this
Assignment, the Assignee acknowledges and agrees to the provisions of Section
9.3 of the Credit Agreement.
6. CREDIT DETERMINATION; LIMITATIONS ON ASSIGNOR'S LIABILITY.
The Assignee represents and warrants to the Assignor, the Borrower, the Agent
and the Bank (a) that it is capable of making and has made and shall continue to
make its own credit determinations and analysis based upon such information as
the Assignee deemed sufficient to enter into the transaction contemplated hereby
and not based on any statements or
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representations by the Assignor, (b) the Assignee confirms that it meets the
requirements to be an assignee as set forth in Sections 9.1(a) and 9.1(b) of the
Credit Agreement; (c) the Assignee confirms that it is able to fund the
Advances, and (d) the Assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Credit Agreement
and the Loan Documents as are required to be performed by it as a Bank
thereunder. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor makes
no representation or warranty of any kind to the Assignee and shall not be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of the Credit Agreement or any Loan
Documents, (ii) any representation, warranty or statement made in or in
connection with the Credit Agreement or any of the Loan Documents, (iii) the
financial condition or creditworthiness of the Borrower or any guarantor, (iv)
the performance of or compliance with any of the terms or provisions of the
Credit Agreement or any of the Loan Documents, (v) inspecting any of the
property, books or records of the Borrower or (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Advances. Neither the Assignor nor any of its
officers, directors, employees, agents or attorneys shall be liable for any
mistake, error of judgment, or action taken or omitted to be taken in connection
with the Advances, the Credit Agreement or the Loan Documents, except for its or
their own bad faith or willful misconduct. The Assignee appoints the Agent to
take such action as agent on its behalf and to exercise such powers under the
Credit Agreement as are delegated to the Agent by the terms thereof;
7. INDEMNITY. The Assignee agrees to indemnify and hold the
Assignor harmless against any and all losses, costs and expenses (including,
without limitation, reasonable attorneys' fees) and liabilities incurred by the
Assignor in connection with or arising in any manner from the Assignee's
performance or non-performance of obligations assumed under this Assignment
Agreement.
8. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the
Assignee shall have the right pursuant to Section 9.1 of the Credit Agreement to
assign the rights which are assigned to the Assignee hereunder to any entity or
person, provided that (i) any such subsequent assignment does not violate any of
the terms and conditions of the Credit Agreement, any of the Loan Documents, or
any law, rule, regulation, order, writ, judgment, injunction or decree and that
any consent required under the terms of the Credit Agreement or any of the Loan
Documents has been obtained, (ii) the assignee under such assignment from the
Assignee shall agree to assume all of the Assignee's obligations hereunder in a
manner satisfactory to the Assignor and (iii) the Assignee is not thereby
released from any of its obligations to the Assignor hereunder.
9. REDUCTIONS OF AGGREGATE AMOUNT OF COMMITMENTS. If any
reduction in the aggregate amount of the Revolving Credit Commitments occurs
between the date of this Assignment Agreement and the Effective Date, the
percentage of the aggregate amount of the Revolving Credit Commitments assigned
to the Assignee shall remain the percentage specified in Section 1 hereof and
the dollar amount of the Revolving Credit Commitment of the Assignee shall be
recalculated based on the reduced aggregate amount of the Revolving Credit
Commitments.
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10. ENTIRE AGREEMENT. This Assignment Agreement and the
attached consent embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings between the
parties hereto relating to the subject matter hereof.
11. GOVERNING LAW. This Assignment Agreement shall be governed
by the internal law, and not the law of conflicts, of the State of Ohio.
12. NOTICES. Notices shall be given under this Assignment
Agreement in the manner set forth in the Credit Agreement. For the purpose
hereof, the addresses of the parties hereto (until notice of a change is
delivered) shall be the address set forth under each party's name on the
signature pages hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Assignment Agreement by their duly authorized officers as of the date first
above written.
[NAME OF ASSIGNOR]
_____________________________________
By:__________________________________
Its:_________________________________
[NAME OF ASSIGNEE]
_____________________________________
By:__________________________________
Its:_________________________________
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ATTACHMENT I
TO
FORM OF BANK ASSIGNMENT AGREEMENT
NOTICE OF ASSIGNMENT
To: OM Group, Inc,
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: __________________
NATIONAL CITY BANK, as Agent
0000 Xxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: ____________________
From:[NAME OF ASSIGNOR]
[NAME OF ASSIGNEE]
______________, 19___
1. We refer to that certain Credit Agreement, dated as of
______________, 1998 (which, as it may be amended, modified, renewed or extended
from time to time, is herein called the "Credit Agreement"), among OM Group,
Inc. (the "Borrower"), the banks which are signatories thereto (the "Banks"),
ABN Amro Bank N.V., as Co-Agent (the "Co-Agent"), National City Bank as Letter
of Credit Bank (the "Letter of Credit Bank"), and National City Bank as agent
for the Banks and the Letter of Credit Bank (the "Agent"). Capitalized terms
used herein and not otherwise defined herein shall have the meanings attributed
to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice" ) is given and
delivered to ****[the Borrower and]**** the Agent pursuant to Section 9.1(a) of
the Credit Agreement.
3. ___________________________("Assignor") and
______________________ (the "Assignee") have entered into an Assignment
Agreement, dated as of ____________, 19___, pursuant to which, among other
things, the Assignor has sold, assigned, delegated and transferred to the
Assignee, and the Assignee has purchased, accepted and assumed from the
Assignor, an undivided interest in and to all of the Assignor's rights and
obligations under the Credit Agreement such that Assignee's percentage of the
aggregate amount of the Revolving Credit Commitments shall equal
__________________ Dollars
----------
*to be included only if consent must be obtained from the Company pursuant
to Section 9.01 of the Credit Agreement.
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($________________________) __________________ percent (____%), effective as of
the "Effective Date" (as hereinafter defined).
4. The "Effective Date" shall be the later of ____________,
19___ or two Business Days (or such shorter period as agreed to by the Agent)
after this Notice of Assignment and any consents required by Sections 9.1(a),
9.1(b) and 9.1(c) of the Credit Agreement have been delivered to the Agent,
provided that the Effective Date shall not occur if any condition precedent
agreed to by the Assignor and the Assignee has not been satisfied; provided,
however, that, in the event that the Borrower shall appropriately deliver a
Credit Request prior to the time at which all of conditions to the effectiveness
of this Assignment shall have been met, the Effective Date shall be the Business
Day immediately following the day upon which the Advances by the Bank are to be
made under such Credit Request.
5. As of this date, the Ratable Portion of the Assignor in the
aggregate amount of the Revolving Credit Commitments, Advances and the LC
Exposure is _____% (____________________________ Dollars ($_______________)). As
of the Effective Date, the Ratable Portion of the Assignor in the aggregate
amount of the Revolving Credit Commitments, Advances and LC Exposure will be
_____% (_______________________ Dollars ($________________)) (as such percentage
may be reduced or increased by assignments which become effective prior to the
assignment to the Assignee becoming effective) and the Ratable Portion of the
Assignee in the aggregate amount of the Revolving Credit Commitments, Advances
and the LC Exposure will be _____% (__________________________ Dollars
($________________)).
6. The Assignor and the Assignee hereby give to the Borrower
and the Agent notice of the assignment and delegation referred to herein. The
Assignor will confer with the Agent before ________________, 19___ to determine
if the Assignment Agreement will become effective on such date pursuant to
Section 3 hereof, and will confer with the Agent to determine the Effective Date
pursuant to Section 3 hereof if it occurs thereafter. The Assignor shall notify
the Agent if the Assignment Agreement does not become effective on any proposed
Effective Date as a result of the failure to satisfy the conditions precedent
agreed to by the Assignor and the Assignee. At the request of the Agent, the
Assignor will give the Agent written confirmation of the occurrence of the
Effective Date.
7. The Assignee hereby accepts and assumes the assignment and
delegation referred to herein and agrees as of the Effective Date (i) to perform
fully all of the obligations under the Credit Agreement which it has hereby
assumed and (ii) to be bound by the terms and conditions of the Credit Agreement
as if it were a "Bank".
8. The Assignor and the Assignee request and agree that any
payments to be made by the Agent to the Assignor on and after the Effective Date
shall, to the extent of the assignment referred to herein, be made entirely to
the Assignee, it being understood that the Assignor and the Assignee shall make
between themselves any desired allocations.
9. The Assignor and the Assignee request and direct that the
Agent prepare and cause the Borrower to execute and deliver the Notes or, as
appropriate, replacements notes, to the Assignor and the Assignee in accordance
with Section 9.1(c) of the Credit Agreement. The
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Assignor [and the Assignee] agree[s] to deliver to the Agent the original Note
received from it by the Borrower upon its receipt of a new Note in the amount
set forth above.
The Assignee advises the Agent that the address listed below
is its address for notices under the Credit Agreement:
___________________________________
___________________________________
___________________________________
The Assignee advises the Agent that the address listed below
is the address of its Lending Office and the wire transfer instructions for
delivery of funds by the Agent thereto:
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
___________________________________
ASSIGNOR
______________________________________________________________
By:___________________________________________________________
Its: _________________________________________________________
ASSIGNEE
______________________________________________________________
By:___________________________________________________________
Its:__________________________________________________________
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ATTACHMENT II
TO
FORM OF BANK ASSIGNMENT AGREEMENT
CONSENT AND RELEASE
TO:[NAME OF ASSIGNOR]
____________________________
____________________________
[NAME OF ASSIGNEE]
____________________________
____________________________
________________, 19___
1.We acknowledge receipt from __________________________ (the
"Assignor") and ________________________ (the "Assignee") of the Notice of
Assignment, dated as of _______________, 19____ (the "Notice"). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
attributed to them in the Notice.
0.Xx consideration of the assumption by the Assignee of the
obligations of the Assignor as referred to in the Notice, [the Borrower****] and
the Agent hereby (i) irrevocably consent[s], pursuant to Section 9.1(a) of the
Credit Agreement, to the assignment and delegation referred to in the Notice and
(ii) as of the Effective Date, irrevocably reduces the percentage of the
Assignor in the aggregate amount of the Revolving Credit Commitments, the
Advances and the Letters of Credit by the percentage of the aggregate amount of
the Revolving Credit Commitments, the Advances and the Letters of Credit
assigned to the Assignee and releases the Assignor from all of its obligations
to the Borrower under the Credit Agreement and any of the Loan Documents to the
extent that such obligations have been assumed by the Assignee.
****[3.The Borrower directs the Agent to prepare for issuance
by the Borrower of new Notes requested by the Assignor and the Assignee in the
Notice.]****
0.Xx consideration of the assumption by the Assignee of the
obligations of the Assignor as referred to in the Notice, the Agent and each of
the Bank executing below (which constitute the Required Banks under the Credit
Agreement) hereby (i) irrevocably consents, pursuant to Section 9.1(a) of the
Credit Agreement, to the assignment and delegation referred to in the Notice,
(ii) as of the Effective Date, irrevocably releases the Assignor from its
obligations to the Agent under the Credit Agreement or any of the Loan Documents
to the extent that such obligations have been assumed by the Assignee, and (iii)
agrees that, as of the Effective Date, the Agent shall consider the Assignee as
a "Bank" for all purposes under the Credit Agreement and
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any of the Loan Documents to the extent of the assignment and delegation
referred to in the Notice.
OM GROUP, INC.
______________________________________________________________
By:___________________________________________________________
Its:__________________________________________________________
NATIONAL CITY BANK, as Agent
______________________________________________________________
By:___________________________________________________________
Its:__________________________________________________________
To be included only if the consent of the Borrower is required pursuant to
Section 9.1(a) of the Credit Agreement.
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EXHIBIT 4.4
FORM OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
Matters To Be Covered In
Opinion of Special Counsel To the Company
-----------------------------------------
1. Each of the Company, its domestic Restricted Subsidiaries and KCO
being duly incorporated, validly existing and in good standing under the laws of
its jurisdiction of incorporation and having requisite corporate power and
authority to issue and sell the Notes and to execute and deliver and to perform
its obligations under the Notes and the Note Agreements.
2. Each of the Company, its domestic Restricted Subsidiaries and KCO
being duly qualified and in good standing as a foreign corporation in
appropriate jurisdictions.
3. The Guarantors being corporations validly existing in good standing
under the laws of their state of incorporation having requisite corporate power
and authority to operate and deliver and to perform their obligations under the
Guaranty Agreements.
4. Due authorization and execution of the Notes, Note Agreements and
Guaranty Agreements and such documents being legal, valid, binding and
enforceable.
5. No conflicts with charter documents, laws or other agreements and no
creation of Liens in respect of any property of the Company, the Guarantors or
any other Restricted Subsidiary.
6. All consents required to issue and sell the Notes and to execute and
deliver the Notes, Note Agreements and Guaranty Agreements having been obtained.
7. No litigation questioning validity of documents.
8. The Notes not requiring registration under the Securities Act of
1933, as amended; no need to qualify an indenture under the Trust Indenture Act
of 1939, as amended.
9. No violation of Regulations G, T, U or X of the Federal Reserve
Board.
10. Company and each Guarantor not an "investment company", or a
company "controlled" by an "investment company", under the Investment Company
Act of 1940, as amended. Company and each Guarantor not a "public utility" as
such term is defined in the
123
Federal Power Act, as amended. Company and each Guarantor not subject to
regulation under any Federal, Ohio or Delaware law which limits its ability to
incur Indebtedness.
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